CONTENTS

Sr. No Index Page No.

1 Introduction 5

2 Information about the entrepreneur and project 6

3 Information about the firm 11

4 Details of the proposed project 15

5 Breakeven analysis 16

6 Description of the location 21

7 Cash flows 22

8 Conclusion 23

9 References 24

1
 Introduction

The uninterrupted power supply (UPS) unit is used as stand by

power supply during interruption of regular power supply due to
load shedding, power failure, power fluctuations etc. The UPS
provides a reliable and stable power to the equipments/systems
sensitive to power variations and interruptions. It functions as
voltage stabilizer and at the same time it isolates the
equipment/systems from the power lines.

The UPS finds wide applications as a reliable power source to

computer, telex and fax system and where continuous regular
and stable power supplies are required. The major users of UPS
are the industries, business houses/establishments, hospitals,
banks, offices, cinema theatres, railway stations and hotels etc.

The UPS consists of a battery charger, an inverter, and output

transformer, a set of batteries, control circuits and transient/EMI
filters.

The on-line UPS provides a conditioned output voltage when the

power is on and charges the battery through the battery
charger. The control circuits of UPS automatically switch over to
the inverter and supply power from the batteries during power
interruption/failure. The change-over from mains to the battery
and back to the mains supply is done automatically by the
control circuits. The modern UPS employs MOSFET based

2
inverter and pulse width modulators techniques and static
switches.

INFORMATION ABOUT THE

ENTREPRENEUR AND PROJECT

Name of the entrepreneurs:-

K. Lokesh Acharaya (0701229274)

Alok Kumar Sinha (0701229277)

Rakesh Kumar (0701229311)

Kalikant (0701229323)

Name of the project: -

Uninterrupted Power Systems Manufacturer

Description of the product:-

An uninterruptible power supply (UPS), also known as a battery back-up,

provides emergency power and, depending on the topology, line regulation as well to
connected equipment by supplying power from a separate source when utility power is not
available. It differs from an auxiliary or emergency power system or standby generator, which
does not provide instant protection from a momentary power interruption. A UPS, however,
can be used to provide uninterrupted power to equipment, typically for 5–15 minutes until an
auxiliary power supply can be turned on or utility power is restored.

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 While not limited to safeguarding any particular type of equipment, a UPS is typically
used to protect computers, data centers, telecommunication equipment or other electrical
equipment where an unexpected power disruption could cause injuries, fatalities, serious
business disruption or data loss. UPS units come in sizes ranging from units which will back
up a single computer without monitor (around 200 VA) to units which will power entire data
centers or buildings (several megawatts).

Available substitute in the market:-

The transfer switches which allow transfer from primary power source to secondary
power source and Compressed Natural Gas (fossil fuels) are available in the market.

Competitors:-
Printech, Sundaram Infotech, Auro Electricals, Sai Electronics, Shree Power,
Vinayaka Info, Intex, Microtech.

Product description of competitors with their special

features unique selling proposition:-

INTEX and MICROTECH are the largest manufacturers in India. They roll out
nearly 2 lakh UPS every year on individual basis. INTEX sells its UPS of 600KVA
at Rs 1500/per piece and 1000KVA at Rs 3000/per piece, whereas MICROTECH
sells its 600 KVA at Rs 1950/per UPS and 1000KVA at Rs 2600/per piece whereas
the production cost comes around Rs 1000/per UPS for 600KVA and Rs 2000/per
UPS for 1000KVA. Their major customers are big organizations and institutions.

Special feature of the product:-

E-link UPS has targeted the organizations at big cities and towns. The
marketability of the product depends on price, performance and back-up and
servicing facility. If these aspects are maintained to suit the market, the product
will find good market potential creating demand in large quantities. By
implementing advanced technology the cost of production can be decreased.

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Reducing the cost of the product will attract the customer but the quality should
remain unaltered.

Present demand and supply position of the product:-

There are about 200 units in small scale sector manufacturing UPS
besides 10-15 units in the organized sector. The small scale units
generally are concentrating on UPS below 50 KYA range. The UPS has a
large Market Potential in the coming years.

5
Future demand and supply position of the product:-

Industrialization and development of India rises the potential customers

.This will increase the demand in geometric progression.

Market scenario:-

With the rise in computer literacy in India, people have started

preferring computers. But due to the unwanted power supply cut off a
huge amount of work has been stopped and as a result a great amount of
loss has been occurred. So in order to make the unwanted power supply
not to hamper our daily life’s we can use these UPS (uninterrupted power
supply) which can make our life more comfortable even in a power cut.

Anticipate change in test preference and need of

the product

In future the customer will prefer high quality product at affordable rate.
They will prefer lowest power consuming product with long usage life.

Anticipate change in technology, source of raw

material

The technology is changing rapidly now there will be machineries with

standard and affordable cost and high efficiency that could cut the cost of
production. Advanced packing technology could increase the life span of the
product. New equipments will reduce the labor cost. Advanced software will
forecast the demand of the market and will enable the entrepreneur high
decision making capabilities.

6
Target buyers:-

Industries, business houses/establishments, hospitals, banks, offices,

cinema theatres, railway stations and hotels etc.

Target market share:-

Initially the company has targeted the small towns. By introducing E-link
UPS with the features of the branded ones at an affordable price the company
will be holding major market share of the big cities and towns.

Marketing strategy:-

The marketability of the product depends on price, performance and

period of cost recovery and servicing facility. If these aspects are maintained to
suit the market, the product will find good market potential creating demand in
large quantities. It will fully utilize its machinery to opt for maximum production
capability of the equipment. Selling the product at the local market also cutout
the transportation cost. So keeping the product price bit above competitors price
won’t hamper attracting the major customers because it will have a efficiency
thrice of any other UPS.

Product diversification:-

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 The modern UPS employs MOSFET based inverter and pulse width
modulators techniques and static switches for which the manufacturer can
attract quality conscious customers.

INFORMATION ABOUT THE FIRM:-

Name of the Firm:-

Power Tech Private ltd.

Location of the Firm: -

Industrial Estate.

Nature of organization: -

Partnership.

Address of the Firm:-

Plot no. SP-63

Mancheswar Industrial Estate

Bhubaneswar

Pin 751010

Type of project:-

Manufacturing.

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DETAILS OF PROPOSED PROJECT:-
1. Production program (for a period of one year)
Quality and Standards : As per customers requirement
Production Capacity : 2400 Nos. (per annum)
(1500 Nos. 1KVA + 900 Nos. 500VA)
Production Value : Rs. 99,26,640

Basis and Presumptions

1) The basis for calculation of production capacity has been taken on

single shift basis on 75% efficiency.
2) The maximum capacity utilization on single shift basis for 300 days a
year. During first year and second year of operations the utilization
is 60% and 80% respectively. The unit is expected to achieve full
capacity utilization from the third year onwards.
3) Interest on term loan and working capital loan has been taken at the
rate of 16% on an average. This rate may vary depending upon the
policy of the financial institutions/agencies from time to time.
4) The cost of machinery and equipments refer to a particular
make/model and prices are approximate.
5) The break-even point percentage indicated is of full capacity
utilization.
6) The project preparation cost etc. whenever required could be
considered under pre-operative expenses.
7) The essential production machinery and test equipment required for
the project have been indicated. The unit may also utilize common
test facilities available at Electronics Test and Development Centre’s
(ETDCs) and Electronic Regional Test Laboratories (ERTLs) set up by
the State Governments and STQC Directorate of the Department of
Information Technology, Ministry of Communication and Information

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 Technology, to manufacture products conforming to Bureau of Indian
Standards.

2. Input
2.1 Machiner:

Qty.
Sl.No. Particulars Imp/ Ind. Total (Rs.)
(Nos.)

1. Oscilloscope (0 - 50 MHz) 1 Ind. 50,000

2 LCR-Q Meter 1 Ind. 13,000

Power Supplies (0 – 30V, 3
3 2 Ind. 20,000
Amp)
4½ Digit Digital
4 2 Ind. 20,000
Multimeter
5 Analog Multimeter 3 Ind. 18,000
Auto Transformer and
6 1&8 Ind. 19,000
rheostat
Bore well and water
7 1 Ind. 50,000
distribution
High Voltage Breakdown
8 1 Ind. 35,000
Tester
Testing Setup (consists of
voltmeter, Ampmeter,
9 1 Set Ind. 15,000
Wattmeter and Lead
Batteries)
10 Insulation Tester 1 Ind. 5,000
11 Excise, sales tax and 24,500
electrification Charges @

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 40% of Cost of Machinery
and Equipment
12 Tools, Jigs, Fixtures Ind. 20,000
Office Equipment and
13 40,000
Furniture

2.2 Raw material

Sl.
No Particulars Sl.No.
.
ICs, Thyristor, Diodes, Displays, Mosfet
1 1
etc.
Resistors, Capacitors, Variastor, Presets,
2 2
Potentiometer etc.

3 Transformers 3

4 Printed Circuit Boards 4

5 Relays and Coils 5

Electro-Mechanical Components like
6 Connectors, Switches, Buttons/Knobs 6
etc.,

7 Cables and Wires 7

2.3 Utilities (per month)

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 Utilities (per month) (Rs.)
Power 5,000
Water 5,00
Total 5,500

2.4 Labor

Salary
Sl.No. Designation Nos. Total (Rs.)
(Rs.)
1 General Manager 1 8,000 8,000
Production Manager and
2 supervisory personnel for 1 7,000 7,000
production
Sales and marketing and service
3 5 3,000 15,000
team
4 Peon & watchmen 3 2,000 6,000
Finance, accounts purchase and
5 4 3,000 12,000
administrative staff
6 Skilled Workers 4 5,000 20,000
7 Semi-Skilled Workers 6 4,000 24,000
Total 92,000
Add Perquisites @ 10% of total 9,200

Total 1,01,200

3. Cost of project

3.1 Fixed cost

(i) Land and Building

12
Sl.No. Particulars Total(Rs.)

1.
Land: 900 Sq. mtrs @ Rs. 300 per sq. Mtr. Value: 2,70,000

2. Civil construction:
Boundary wall, gates, inside roads 2,00,000
3. Assembly, testing laboratory, raw material &
finished goods store 450 Sq. mtr @ Rs.4000 Sq. 18,00,000
mtr.

4. Workers room, security Rooms and offices 100 Sq.

3,00,000
mtr @ Rs. 3000 / Sq. mtr

5. Total civil construction cost 23,00,000

6. (i) Land and civil cost 25,70,000

(ii) Machinery and Testing Equipments

Qty.
Sl.No. Particulars Imp/ Ind. Total (Rs.)
(Nos.)

1. Oscilloscope (0 - 50 MHz) 1 Ind. 50,000

2 LCR-Q Meter 1 Ind. 13,000

Power Supplies (0 – 30V, 3
3 2 Ind. 20,000
Amp)

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 4½ Digit Digital
4 2 Ind. 20,000
Multimeter
5 Analog Multimeter 3 Ind. 18,000
Auto Transformer and
6 1&8 Ind. 19,000
rheostat
Bore well and water
7 1 Ind. 50,000
distribution
High Voltage Breakdown
8 1 Ind. 35,000
Tester
Testing Setup (consists of
voltmeter, Ampmeter,
9 1 Set Ind. 15,000
Wattmeter and Lead
Batteries)
10 Insulation Tester 1 Ind. 5,000
Excise, sales tax and
electrification Charges @
11 24,500
40% of Cost of Machinery
and Equipment
12 Tools, Jigs, Fixtures Ind. 20,000
Office Equipment and
13 40,000
Furniture
Total pl. & m/c cost (add 1 to 13) 3,29,500
(iii) (Pre operative expenses) 2,00,000
Total fixed cost = (i) + (ii) + (iii) = Rs. 25,70,000+
30,99,500
Rs. 3,29,500+ Rs. 2,00,000

3.2 Variable cost

B. Working Capital (per month)

(i) Staff and Labour

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 Salary Total
Sl.No. Designation Nos.
(Rs.) (Rs.)
1 General Manager 1 8,000 8,000
Production Manager and
2 supervisory personnel for 1 7,000 7,000
production
Sales and marketing and service
3 5 3,000 15,000
team
4 Peon & watchmen 3 2,000 6,000
Finance, accounts purchase and
5 4 3,000 12,000
administrative staff
6 Skilled Workers 4 5,000 20,000
7 Semi-Skilled Workers 6 4,000 24,000
Total 92,000
Add Perquisites @ 10% of total 9,200

Total 1,01,200

(ii) Raw Material Requirements (per month)

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 Price/Unit (Rs.)
Sl.No. Particulars
1KVA—500VA
Ics, Thyristor, Diodes,Displays, Mosfet
1 350 - 150
etc.
Resistors, Capacitors, Varister, Presets,
2 100 – 70
Potentiometer etc.
3 Transformers 300 – 150
4 Printed Circuit Boards 500 - 100
5 Relays and Coils 75 – 50
Electro-Mechanical Components like
6 Connectors, Switches, Buttons/Knobs 100 – 50
etc.,
7 Cables and Wires 100 – 75
8 Enclosure 100- 80
Consumables (Solder, Flux, Printing
9 75 - 30
Material)
10 Battery No – 400
Total 1700 – 1155
Cost of Raw Materials for 200 Nos. (125
nos 1KVA + 75 Nos. 500 VA ( Rs. 2,12,500 Rs. 2,99,125
+ Rs. 86,625 )

Cost of Raw material for 150Nos Rs. 2,12,500 – 86,625

Cost of Raw material for 150Nos Rs. 2,99,125

Note: The quality and quantity of raw material requirement vary with
design and features of the UPS.

(iii) Utilities (per month)

Utilities (per month) (Rs.)

Power 5,000
Water 5,00

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 Total 5,500

(iv) Other Contingent Expenses (per month)

Other Contingent Expenses (per month) (Rs.)

Postage and Stationery 500
Repair and Maintenance 2,000
Telephone 3,000
Transport Charge 3,000
Advertisement/Publicity 5,000
Insurance 2,000
Miscellaneous Expenses 500

Total 16,000
Total Recurring Expenditure (i + ii + iii + iv) Rs. 4,21,825

3.3 Total cost of production

Total Capital Investment Amount in Rs.

(a) Fixed Capital 30,99,500
(b) Working Capital for 3 months 12,65,475
Total 54,09,500

4. Means and sources of raising finances

Sr. No Particulars Amount (Rs)

1 Long term loan 2,00,000

2 Short term loan 1,00,000

3 Own investment 5,50,000

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5. Project Profitability Analysis

Sr. No Particulars per annum Amount (Rs.)

1 Sales Revenue 99,00,000

2 Manufacturing Expenses(2.2+2.3+2.4) 81,51,400

3 Packaging materials 1,26,000

4 Selling & Distribution Expenses 4,20,000

5 Administrative Expenses 2,66,000

6 Interest 3,38,000

7 Depreciation of machineries (@20%)

8 Depreciation of furniture’s (@15%)

BREAKEVEN ANALYSIS:-

Gross profit
G.P = S.R – T.C = 5, 23,000

Net profit
N.P = G.P – Tax = 3, 66,100 * Tax @30% of
gross profit

Profit ratio
N .P ×100
P.R = = 3.69
S .R

Brake even point

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 FC ×100
BEP = = 89.44
FC + N .P

Rate of return
N .P ×100
RR = = 8.39
FC +WC

DESCRIPTION OF LOCATION:-

Location

The applicant firm has acquired plot no. AL-57 in Mancheswar industrial
estate by paying a lease premium of Rs. 1, 54,000/- and taken over the plot of
land as per agreement dated 11/03/08. All infrastructures are available.

The applicant firm has acquired the premises measuring1800 sq.feet. Out
of survey No.3452/08A of city Bhubaneswar district Khurda for Rs. 1, 54,000/-. As
per the contract deed dated 11/03/08.

The applicant firm has already obtained the NOC dated 11/03/08 from IDC.

Site development

On the above mentioned premises the applicant firm has proposed to incur
the following land development expenses based on the estimates prepared by its
architect

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 M/s Pragati Architect

1. Redesigning and interior modification

(1000sq.ft @ Rs 30per sq.ft) ………………Rs 30,000/-

2. Compound wall………………………………………………...Rs 13,500/-

3. Entrance gate……………………………………………………Rs 10,000/-
Total= Rs 53,500/-

CASH FLOWS:-

Cash inflow

1 Net Profit 3,66,000

2 Own investment 5,50,000

3 Depreciation

4 Long Term Loan 2,00,000

5 Short Term Loan 1,00,000

Cash outflow

1 Preliminary & preoperative 43,000

expenses

2 Fixed investment

3 Interest 3,38,000

4 Income Tax 1,56,900

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CONCLUSION:-
UPS is an industry where the demand is always likely to increase and very
rarely would there be a decline. With India being a developing country and
the government planning towards a transparent investment and
innovation-oriented economy, the industrial, manufacturing, and services
sectors would have a plethora of companies establishing and expanding
their offices in the near future. Therefore, the opportunities for medium
and high-power UPS are aplenty. As UPS supply
chains have moved from a cost focus to a customer focus and now
currently to a strategic focus, the need to think strategically about the
supply
chain has never been more important. The success of a strategy is only as
good
as the company’s ability to fully and properly execute it. A great UPS
supply chain

strategy, linked with operational excellence, can provide success for not
only the company in question but also its partners and customers. These
are factors that manufacturers should consider and rethink their decision
to establish production plants . One among the ‘Four Tiger countries in
East Asia,’ India, with an aim to become the ‘Green Silicon Island,’ is
definitely a hotbed of opportunities for UPS manufacturers.

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REFERENCES:-

1. www.google.com
2. www.bplans.com
3. www.scribd.com
4. www.frost.com
5. www.ups-scs.com

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SUPPLEMENTARY DETAILS:-

26
REFERENCES:-

1.
Name: Mr. Ajay Kumar Das

Address: Plot No. 11/7C

Nayapalli

Bhubaneswar

751025

Tel. No. 0674-2348951

Occupation: Bank Manager IDBI Bhubaneswar.

2.
Name: Mr. Tanuj Aggarwal

Address: Plot No. L3/95

Bapuji Nagar

Bhubaneswar

751024

Tel. No. 0674-2323145

Occupation: Area Manager ORPAT (ORISSA).

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