2023

PROJECT
REPORT

Piston manufacturing
finline address
 Project at a glance

Name & Address of Unit

Piston manufacturing
finline address ,123456

Activity : Piston Ring Manufacturing

Email : sample@finline.in

Phone : 1234567890

Constitution : Proprietorship

Scheme : sme

Number of employment : 5

Total project cost : 14,50,000.00

Fixed Capital : 7,00,000.00

Working Capital : 7,50,000.00

Total Bank loan : 11,25,000.00

Promoter(s) contribution : 3,25,000.00

Term loan : 5,25,000.00 Interest : 11.00 %

Working capital loan : 6,00,000.00 Interest : 11.00 %

Name & address of promoter(s)

Name : finline sample project

Address : finline address

Phone : 1234567890

Designation : Founder

Category : na

E-mail : sample@finline.in
 Project Feasibility Ratio

Debt Service Coverage Ratio (Average) : 7.08

Current ratio (Average) : 3.84

Year 1 Year 2 Year 3 Year 4 Year 5

Current ratio 2.02 2.92 3.83 4.75 5.66

Quick ratio 1.47 2.34 3.23 4.12 5.00

Interest coverage ratio 16.30 8.37 9.46 10.76 12.42

Debt equity ratio 1.25 0.66 0.41 0.27 0.18

TOL/TNW 1.33 0.71 0.44 0.30 0.21

DSCR 12.93 5.45 5.61 5.69 5.69

Gross profit Sales Percentage % 56.10 % 41.00 % 40.45 % 39.80 % 39.03 %

Net profit Sales Percentage % 22.05 % 10.09 % 9.96 % 9.71 % 9.34 %

BEP in % of installed capacity % 63.03 % 74.25 % 75.17 % 76.42 % 78.02 %

BEP in sales of Rupees 15.79 48.09 52.17 56.57 61.36

Return On Capital Employed 0.50 0.42 0.34 0.28 0.24

Net profit Sales % Quick ratio

Project Feasibility graph
Revenue v/s Expense

Expense Splitup
 Introduction

The piston ring is one of the most important parts of the Deisel/Petrol engines. It is an open-ended ring that
fits into a groove on the outer diameter of a piston in a reciprocating engine such as an internal combustion
engine or steam engine. The principal function of the piston rings is to form a seal between the combustion
chamber and the crankcase of the engine. The goal is to prevent combustion gases from passing into the
crankcase and oil from passing into the combustion chamber The three main functions of piston rings in
reciprocating engines are: 1. Sealing the combustion/expansion chamber. 2. Supporting heat transfer from
the piston to the cylinder wall. 3. Regulating engine oil consumption. During the compression and power
strokes, the compression ring seals the combustion gases and prevents blow-by. Although blow-by is not
completely eliminated it is kept to an acceptable limit. During the compression and exhaust strokes, the
cylinder walls are lubricated with oil by a throw off from the connecting rod bearings. Excess oil is wiped off by
the piston rings. Not only does the oil ring have the responsibility of wiping the excess oil off the cylinder walls,
but the job is also shared by all of the rings, leaving a fine layer of oil on the wall to provide lubrication for the
following ring. As rings wear, the ability to perform these functions is decreased resulting in oil consumption
and blow-by. When this happens it is time for a new set of rings.
 Product / Services & process

Piston rings are generally made up of cast iron. The blanks of cast rings of required size and desired
properties are procured from the local foundries. After that blanks are cleaned and get ground. Then the
blanks are undergone through various processes like facing, rough diameter, rough bore, finish diameter &
finish bore. The rings are generally machined to the required shape by means of turning, a process in which
the ring blank, already axially ground, is copy turned on the inside and outside diameters. After a segment
equivalent to the free gap is cut from the ring it assumes the free shape that will give it the required radial
pressure distribution when fitted into the cylinder..
 Raw materials / Consumables

The materials used to make Piston Rings are one of the most critical factors in its performance.

Listed below are some of today's common material used in manufacturing of piston rings and metallic seals:

Cast iron Cast iron alloyed for piston rings Nodular cast iron alloyed for piston rings Bronze Aluminum Bronze
Phosphor Bronze Steel Stainless Steels for use in high temperature
 Quality & Pollution Control

QUALITY CONTROL The procured blanks castings should be checked very carefully as per given requirement
(size,grade etc). This is the very first step in quality control.The product should be monitored after completion
of each stage so that chance of rejection at the end is eleminated. Piston rings should be manufactured as
per IS : 5791-1971 & IS: 8422 for IC engines.The entire operation of surface treatment/ coating should be
closely controlled. For the inspection process proper callibarated gauges should be used.

POLLUTION CONTROL As this unit doesnot comes under heavy polluted industry, although No Objection
Certificate from pollution control board should be taken.
 Plant & Machinery / Equipments

Sl no Machinename Qty
1 Lathe machine,1800 mm bed with 3 H.P motor 2
2 Lathe machine,900 mm bed with 2 H.P motor 1
3 Face grinder with special attachment, 4 H.P motor 1
4 Bench drill machine.12mm capacity 1
5 Bench grinder,250mm wheel dia,1H.P motor 1
6 Gauges,tools & other equipments LS
 Market potential & Strategy

Piston ring is the one of the most replaceble part of the diesel/petrol engines.It has great demand in the
replaceble market as well as in new engines market.For the last few years there is noticeble increase in the
automobile industry, which is the vast market for it. Piston rings are not only used in the automobile industry
but also used in : • Railway Engines • Compressors • Steam Hammers • Cars • Retaining Rings • Pumps •
Industrial Applications • Cranes • Gearboxes So, by maintaining quality and using proper marketting
techniques there is alwayes a great market of this product.
 Project Cost
Sl. no Item Amount Rs.

1 Building 1,00,000.00

2 Machinery 1,00,000.00

3 Computers/Laptops & Printers 1,00,000.00

4 Racks & storage 1,00,000.00

5 Electrification & Electricity backup 1,00,000.00

6 Transportation of machinery 1,00,000.00

7 Installation of machinery 1,00,000.00

8 Working Capital 7,50,000.00

Total 14,50,000.00
 Working Capital Computation
Sl. no Item Amount Rs.

1 Consumables / stock in hand 2,25,000.00

2 Work in progress 75,000.00

3 Finished goods 75,000.00

4 Working expense. 4,50,000.00

5 Payables 75,000.00

6 Total working capital 7,50,000.00

7 Own Contribution 1,50,000.00

8 Working capital loan 6,00,000.00

 Annual Sales / Revenue
Sales is calculated from November 2023

Sl. no Item Rate Quantity Month Unit Total Rs.

1 Piston ring 102.82 X 7500 X 5 Number 38,55,715.00

Total 38,55,715.00
 Total Yearly Expense
Expense is calculated from November 2023 .

Sl. no Item Amount Rs.

1 Salary 5,00,000.00

2 Repairs and maintenance charges 5,00,000.00

3 Electricity/Gas charges 5,00,000.00

4 Purchase raw materiale 5,00,000.00

5 Transportation cost 5,00,000.00

6 Marketing & advertising cost 5,00,000.00

Total 30,00,000.00
 Application of Fund
Sl. no Item Subsidy % No. Rate Amount Rs.

1 Building 0.00 1 1,00,000.00 1,00,000.00

2 Machinery 0.00 1 1,00,000.00 1,00,000.00

3 Computers/Laptops & Printers 0.00 1 1,00,000.00 1,00,000.00

4 Racks & storage 0.00 1 1,00,000.00 1,00,000.00

5 Electrification & Electricity backup 0.00 1 1,00,000.00 1,00,000.00

6 Transportation of machinery 0.00 1 1,00,000.00 1,00,000.00

7 Installation of machinery 0.00 1 1,00,000.00 1,00,000.00

Total Investment 7,00,000.00

Total Subsidy 0.00

Net Investment 7,00,000.00

 Means of Finance
Sl. no Item Amount

1 Term Loan 5,25,000.00

2 Working capital Loan 6,00,000.00

3 Total loan 11,25,000.00

4 Promoters contribution on term loan 1,75,000.00

5 Promoters contribution on working capital loan 1,50,000.00

 Profitability Statement
All figures are in lakhs
31/03/24 31/03/25 31/03/26 31/03/27 31/03/28

Utilisation of installed capacity @100 @ 65 % @ 70 % @ 75 % @ 80 % @ 85 %

Revenue from operation

Piston ring 92.53 25.06 64.77 69.40 74.02 78.65

Add :

Closing stock 3.75 3.93 4.13 4.34 4.55

Total 28.81 68.71 73.53 78.37 83.21

Less :

Opening stock 0 3.75 3.93 4.13 4.34

Purchase raw materiale 12.00 3.25 8.40 9.00 9.60 10.19

Salary 12.00 5.00 13.20 14.52 15.97 17.56

Repairs and maintenance charges 12.00 3.25 8.40 9.00 9.60 10.19

Electricity/Gas charges 12.00 3.25 8.40 9.00 9.60 10.19

Total 14.75 42.15 45.45 48.90 52.51

Gross profit 14.06 26.56 28.07 29.46 30.70

Less :

Transportation cost 3.25 8.40 9.00 9.60 10.19

Marketing & advertising cost 3.25 8.40 9.00 9.60 10.19

Total 6.50 16.80 18.00 19.20 20.39

Profit before interest, tax and depreciation 7.56 9.76 10.07 10.26 10.30

Depreciation 0.19 0.43 0.37 0.33 0.28

Interest on TL 0.19 0.51 0.41 0.29 0.17

Interest on WC 0.28 0.66 0.66 0.66 0.66

Profit before tax 6.91 8.17 8.64 8.98 9.19

Income Tax 1.38 1.63 1.72 1.79 1.83

Profit after tax 5.52 6.53 6.91 7.18 7.35

 Cash flow statement
All figures are in lakhs
Cash Inflow Pre operative period 31/03/24 31/03/25 31/03/26 31/03/27 31/03/28
Capital 1.75 1.50 0 0 0 0
Subsidy 0 0 0 0 0 0
Termloan 5.25 0 0 0 0 0
Profit before tax with interest 0 7.37 9.33 9.70 9.93 10.01
Increase in WC loan 0 6.00 0 0 0 0
Depreciation 0 0.19 0.43 0.37 0.33 0.28
Increase in Current liability 0 0.75 0.038 0.039 0.041 0.043
Total Cash Inflow 7.00 15.81 9.80 10.11 10.30 10.34

Cash Outflow
Fixed Assets 7.00 0 0 0 0 0
Increase in Current asset 3.75 0.19 0.20 0.21 0.22
Interest on TL 0 0.19 0.51 0.41 0.29 0.17
Interest on WC 0 0.28 0.66 0.66 0.66 0.66
Income Tax 0 1.38 1.63 1.72 1.79 1.83
Decrease in Term loan 0.27 0.86 0.96 1.07 1.20
Drawing 0 0 0 0 0 0
Total Cash Outflow 7.00 5.86 3.85 3.95 4.03 4.08
Opening balance 0 0 9.94 15.89 22.06 28.33
Net Cashflow 0 9.94 5.94 6.16 6.27 6.26
Closing balance 0 9.94 15.89 22.06 28.33 34.59
 Balance sheet
All figures are in lakhs
Liability Pre operative period As of 31/03/24 31/03/25 31/03/26 31/03/27 31/03/28

A. Share holders funds

Capital 1.75 3.25 3.25 3.25 3.25 3.25

Reserve & Surplus 0 5.52 12.06 18.98 26.16 33.52

B.Non current Liabilities

Termloan 5.25 4.98 4.11 3.15 2.07 0.88

C.Current Liabilities

Working capital loan 0 6.00 6.00 6.00 6.00 6.00

Account payable 0.75 0.79 0.83 0.87 0.91

Total Liability 7.00 20.51 26.22 32.21 38.36 44.55

Asset

A. Non current Assets

Fixed Assets 7.00 6.81 6.38 6.01 5.68 5.40

B. Current Assets

Inventory 0 3.75 3.93 4.13 4.34 4.55

Trade receivables 0 0 0 0 0 0

Cash and cash equivalence 0 9.94 15.89 22.06 28.33 34.59

Total Asset 7.00 20.51 26.22 32.21 38.36 44.55

 Repayment of Term loan
All figures are in lakhs
Year Month Installment Outstanding at the beginning Principal repayment Interest Amount paid Outstanding at the end

1 Dec 2023 1 5.25 0.066 0.048 0.11 5.18

1 Jan 2024 2 5.18 0.067 0.048 0.11 5.11

1 Feb 2024 3 5.11 0.067 0.047 0.11 5.05

1 Mar 2024 4 5.05 0.068 0.046 0.11 4.98

2 Apr 2024 5 4.98 0.068 0.046 0.11 4.91

2 May 2024 6 4.91 0.069 0.045 0.11 4.84

2 Jun 2024 7 4.84 0.070 0.044 0.11 4.77

2 Jul 2024 8 4.77 0.070 0.044 0.11 4.70

2 Aug 2024 9 4.70 0.071 0.043 0.11 4.63

2 Sep 2024 10 4.63 0.072 0.042 0.11 4.56

2 Oct 2024 11 4.56 0.072 0.042 0.11 4.48

2 Nov 2024 12 4.48 0.073 0.041 0.11 4.41

2 Dec 2024 13 4.41 0.074 0.040 0.11 4.34

2 Jan 2025 14 4.34 0.074 0.040 0.11 4.26

2 Feb 2025 15 4.26 0.075 0.039 0.11 4.19

2 Mar 2025 16 4.19 0.076 0.038 0.11 4.11

3 Apr 2025 17 4.11 0.076 0.038 0.11 4.04

3 May 2025 18 4.04 0.077 0.037 0.11 3.96

3 Jun 2025 19 3.96 0.078 0.036 0.11 3.88

3 Jul 2025 20 3.88 0.079 0.036 0.11 3.80

3 Aug 2025 21 3.80 0.079 0.035 0.11 3.72

3 Sep 2025 22 3.72 0.080 0.034 0.11 3.64

3 Oct 2025 23 3.64 0.081 0.033 0.11 3.56

3 Nov 2025 24 3.56 0.081 0.033 0.11 3.48

3 Dec 2025 25 3.48 0.082 0.032 0.11 3.40

3 Jan 2026 26 3.40 0.083 0.031 0.11 3.32

3 Feb 2026 27 3.32 0.084 0.030 0.11 3.23

3 Mar 2026 28 3.23 0.084 0.030 0.11 3.15

4 Apr 2026 29 3.15 0.085 0.029 0.11 3.06

4 May 2026 30 3.06 0.086 0.028 0.11 2.98

4 Jun 2026 31 2.98 0.087 0.027 0.11 2.89

4 Jul 2026 32 2.89 0.088 0.027 0.11 2.80

4 Aug 2026 33 2.80 0.088 0.026 0.11 2.71

4 Sep 2026 34 2.71 0.089 0.025 0.11 2.63

4 Oct 2026 35 2.63 0.090 0.024 0.11 2.53

4 Nov 2026 36 2.53 0.091 0.023 0.11 2.44

4 Dec 2026 37 2.44 0.092 0.022 0.11 2.35

Year Month Installment Outstanding at the beginning Principal repayment Interest Amount paid Outstanding at the end

4 Jan 2027 38 2.35 0.093 0.022 0.11 2.26

4 Feb 2027 39 2.26 0.093 0.021 0.11 2.17

4 Mar 2027 40 2.17 0.094 0.020 0.11 2.07

5 Apr 2027 41 2.07 0.095 0.019 0.11 1.98

5 May 2027 42 1.98 0.096 0.018 0.11 1.88

5 Jun 2027 43 1.88 0.097 0.017 0.11 1.78

5 Jul 2027 44 1.78 0.098 0.016 0.11 1.69

5 Aug 2027 45 1.69 0.099 0.016 0.11 1.59

5 Sep 2027 46 1.59 0.100 0.015 0.11 1.49

5 Oct 2027 47 1.49 0.10 0.014 0.11 1.39

5 Nov 2027 48 1.39 0.10 0.013 0.11 1.29

5 Dec 2027 49 1.29 0.10 0.012 0.11 1.18

5 Jan 2028 50 1.18 0.10 0.011 0.11 1.08

5 Feb 2028 51 1.08 0.10 0.0100 0.11 0.98

5 Mar 2028 52 0.98 0.11 0.0090 0.11 0.88

6 Apr 2028 53 0.88 0.11 0.0080 0.11 0.77

6 May 2028 54 0.77 0.11 0.0071 0.11 0.66

6 Jun 2028 55 0.66 0.11 0.0061 0.11 0.56

6 Jul 2028 56 0.56 0.11 0.0051 0.11 0.45

6 Aug 2028 57 0.45 0.11 0.0041 0.11 0.34

6 Sep 2028 58 0.34 0.11 0.0031 0.11 0.23

6 Oct 2028 59 0.23 0.11 0.0021 0.11 0.11

6 Nov 2028 60 0.11 0.11 0.0010 0.11 0

 Debt Service Coverage Ratio
All figures are in lakhs
Particulars 31/03/24 31/03/25 31/03/26 31/03/27 31/03/28

Receipts

a).Net Profit 5.52 6.53 6.91 7.18 7.35

b).Depreciation 0.19 0.43 0.37 0.33 0.28

c).Interest on termloan 0.19 0.51 0.41 0.29 0.17

Total 5.90 7.46 7.69 7.80 7.80

Repayments

a).Loan Principal 0.27 0.86 0.96 1.07 1.20

b).Interest on termloan 0.19 0.51 0.41 0.29 0.17

Total 0.46 1.36 1.36 1.36 1.36

DSCR 12.93 5.45 5.61 5.70 5.70

Average DSCR : 7.08

 Depreciation
All figures are in lakhs
Particulars Rate 31/03/24 31/03/25 31/03/26 31/03/27 31/03/28

Building 5 1.0 0.98 0.93 0.88 0.84

Less Depreciation 0.021 0.049 0.047 0.044 0.042

Written down value 0.98 0.93 0.88 0.84 0.80

Machinery 15 1.0 0.94 0.80 0.68 0.58

Less Depreciation 0.063 0.14 0.12 0.10 0.086

Written down value 0.94 0.80 0.68 0.58 0.49

Computers/Laptops & Printers 15 1.0 0.94 0.80 0.68 0.58

Less Depreciation 0.063 0.14 0.12 0.10 0.086

Written down value 0.94 0.80 0.68 0.58 0.49

Racks & storage 10 1.0 0.96 0.86 0.78 0.70

Less Depreciation 0.042 0.096 0.086 0.078 0.070

Written down value 0.96 0.86 0.78 0.70 0.63

Total less depreciation 0.19 0.43 0.37 0.33 0.28

Total written down value 6.81 6.38 6.01 5.68 5.40

 Assumption
The entire projection is based on the assumption that the sales for 5 years will be

All figures are in lakhs

31/03/24 31/03/25 31/03/26 31/03/27 31/03/28

28.81 68.71 73.54 78.37 83.21

Piston ring : 9253716

Also the total expense for the firm during the projection years will be as follows

31/03/24 31/03/25 31/03/26 31/03/27 31/03/28

21.25 55.20 59.52 63.97 68.57

• The depreciation is as follows

Particulars Value

Building 5%

Machinery 15%

Computers/Laptops & Printers 15%

Racks & storage 10%

• Cost of the land or building is based on the basis of current rate

• Cost of machinery is based on the quotation submitted by the supplier

• Value of raw materials & utility charges as per the current market conditions

• All other assumptions are calculated based on the basis of experience of the promoter and deep study

on the working of similar model

This report is created using www.finline.in . Finline have bears no financial responsibility on or behalf of any of
the authorized signatories
 Conclusion
The project as a whole describes the scope and viability of the Manufacturing industry and mainly of the
financial, technical and its market potential.The project guarantee sufficient fund to repay the loan and also
give a good return on capital investment. When analyzing the social- economic impact, this project is able to
generate an employment of 5 and above. It will cater the demand of Manufacturing and thus helps the other
business entities to increase the production and service which provide service and support to this industry.
Thus more cyclic employment and livelihood generation. So in all ways, we can conclude the project is
technically and socially viable and commercially sound too.

When we take a close look at the Debt Service Coverage Ratio (DSCR), the avg: DSCR is 7.08 : 1, which is at a
higher proposition and proposes a stable venture

The Profit and Loss shows a steady growth in profit throughout the year and the firm has a higher Current
Ratio (average) of 3.84, this shows the current assets and current liabilities are managed & balanced well.
 Break Even Point
All figures are in lakhs
31/03/24 31/03/25 31/03/26 31/03/27 31/03/28

Total fixed cost 6.50 16.80 18.00 19.20 20.39

Total variable cost 14.75 42.15 45.45 48.90 52.51

BEP in % of installed capacity % 63.03 % 74.25 % 75.17 % 76.42 % 78.02 %

BEP in sales of Rupees 15,79,728.74 48,09,672.16 52,17,090.65 56,57,567.99 61,36,986.22