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SCOPE Fabrication industry has gained importance with growing housing industry and stress on the security factors. Factors contributing to this include rapid industrialization, and new uses of the fabricated products. Our aim is to make a Feasibility study for setting up an iron and steel fabrication unit named NS Fabrication engaged in the manufacturing of gates, doors grills and windows. TECHNICAL FEASIBILITY DESCRIPTION OF THE PRODUCT Products manufactured in the iron & steel fabrication industries are as follows: Doors Windows Grills Gates Rolling shutters
DOORS : Iron fabrication are growing because the people are nowadays concerned for the security of the houses, offices and buildings. Doors are the main thing it produces in this category. WINDOWS: These are of different shape and sizes with the aim of providing ventilation with proper security.
GRILLS: Grills also get manufactured through iron fabrication which are used to put over the stairs. GATES: It refers to the main gate or entrance of any house or office. ROLLING SHUTTERS: These are the doors made for the security of the shops.
MANUFACTURING PROCESS
DESIGNING : The designs would be first decided and will be drawn on sheets according to which the product will be made. PRODUCING THE REQUIRED MATERIAL : The material required will be assembled at the production location. JOINING : The joining will include giving basic shape to the product with the use of the welding machine, sheet cutters and pipe cutters would be used to cut the pipes and sheets into desired size and shape. NUTS AND BOLTS: Applying nuts and bolts comes next in the series. FINISHING : The final shape would be given to the product by finishing by the grinding machine and tools and dies.
Designing
Joining
Finishing
PLANT SIZE The plant size is 200 sq mtr. Production schedule At 100% capacity utilization the proposed unit can manufacture 200 tones per annum assuming 300 working days in a year DETAILS OF MACHINERY The following machinery is required for the proposed project.
S.NO 1 2 3 4 5 6 7 Total
PARTICULAR UNIT Drill machine Welding machine Pipe cutter Grinder base Hand rill machine sheet cutter Portable 3 2 2 1 3 2 1
PLANT LOCATION Details of land LOCATION hall, Greater Noida The area is well-developed and all infrastructural facilities like power, water, transportation, labour etc. are readily available. Labour requirement : N.S. FABRICATION Plot no-80, Surajpur, near durga cinema
S.NO 1 2
NOS 5 5
3 4 5
2 1 1
TOTAL-
6,69,300
POWER REQUIRED 60,000 UNIT UNIT RATES UNIT COST TOTAL COST Installed capacity At 100% capacity utilization the proposed unit can manufacture 200 tones per annum assuming 300 working days in a year Year 4th year Capacity utilisation in % MARKET FEASIBILITY MARKET DESCRIPTION The concept of iron and steel fabrication is not new to to the market and the demand for fabricated goods is increasing day by day with the civilization of society and different uses have come in front. CHANNELS OF DISTRIBUTION Distribution channel will be direct delivery of the product and direct and indirect receiving of orders CONSUMERS OF THE PORDUCT The potential buyers are the industrialists dealing with the iron products. The other buyers are owners of the construction companies who put some iron products in the buildings, houses and factories they used to construct. 60% 70% 80% 90% 1st year 2nd year 3rd year = 4.50(COMMERCIAL METER) = 2,70,000 = 2,70,000
COMPETITIVE POSITION OF THE PRODUCT The competition on this field is considerably growing but with the growth and development of the business environment as a whole, there is no need to mention the importance of fabrication in this industry. With the increasing demand day by day fabrication is now an integral part of the industry. Fabrication of iron goods, welding of items in the industry is a very common process. FINANCIAL FEASIBILITY COST OF PROJECT PARTICULAR LAND BUILDING PLANT & MACHINERY OTHER ASSETS PRE-OPERATIVE EXP MARGIN OF WORKING CAPITAL AMOUNT 18,00,000 5,00,000 80,000 32,000 100,000 1,43,000 26,55,000
TOTAL
Means of finance
OWNERS CAPITAL UNSECURED LOAN(family) 20,00,000 6,55,000 _________ 26,55,000 ___ ______
1ST
60% 54,00,000 54,00,000
2ND
70% 63,00,000 63,00,000
3RD
80% 72,00,000 72,00,000
4TH
90% 81,00,000 81,00,000
(4) REPAIR & 7344 MAINTAINAN CE (5) DEPRICIATIO N (6) PREOPERATIVE EXP( W.OFF) TOTAL (B) GROSS PROFIT (A-B) INT.ON WORKING 51,240 73,200
62,880
54,342
47,220
20,000
20,000
20,000
20,000
31,94,924 22,05,076
37,01,558 25,92,442
42,09,974 29,90,026
47,19,806 33,80,194
51,240
51,240
51,240
CAPITAL LOAN (D) ADMINISTRA TIVE EXP (E) SELLING & DIST EXP (F) PROFIT BEFORE TAX (G) PROVISION FOR TAX (35 %) (H) PROFIT AFTER TAX (I) ADD DEP & PRE OPERATIVE EXP (J) NET CASH ACCRUAL 1,62,000 1,89,000 2,16,000 2,43,000
12,24,494 93,200
14,47,032 82,880
16,76,211 74,342
19,00,571 67,220
13,17,694
15,29,912
17,50,553
16,67,791
YEAR (A) SOURCES OF FUND 1. NET CAH ACCRUAL 2. OWNERS CAPITAL 3. WORKING CAPITAL REQUIREMENT 4. UNSECURED LOAN
1ST
2ND
3RD
4TH
12.97 -
14.95 -
17.64 -
5.INCREASE IN SUNDRY CREDITORS TOTAL (B) APPLICATION OF FUND 1. FIXED ASSETS 2.PRE-OPERATIVE EXP 3.INC. IN CURRENT ASSETS (A) RAW MATERIAL (B) SUNDRY DEBTORS
1.20 41.83
0.24 13.21
0.24 15.19
0.24 17.88
23.45 0.50
2.40 4.50
(FIG IN LACS)
PARTICULAR
PERIOD
AMOUNT
CURRENT ASSETS
RAW MATERIAL
1 MONTH
2,40,000
SUNDRY DEBTORS
1 MONTH
4,50,000
15 DAYS
(1,20,000)=5,70,000
MARGINS OF WORKING CAPITAL WORKING CAPITAL LOAN REQUIRED INTEREST ON WORKING CAPITAL @ 12%
120,000 44,26,494
1,40,000 58,93,526
1,60,000 75,89,737
1,80,000 95,10,308
P&M OTHER ASSET RAW MATERIAL DEBTORS PREOPERATIVE CASH & BANK TOTAL