MSME-DI KANPUR

PROJECT PROFILE

ON

Domestic Pressure Cookers

**********************

PART- I.

NAME OF THE PRODUCT : Domestic Pressure Cookers.

PRODUCT CODE : 345301005.

QUALITY & STANDARD : IS: 2347:1995 for Domestic Pressure Cookers,

Reaffirmed 1991.
IS: 7466:1994 on Rubber Gaskets for Cookers,
Reaffirmed 2003.

PRODUCTION CAPACITY : The production capacity of the unit at 75% capacity

utilisation.
Quantity - 29,000 Nos. Per Annum

Value - Rs. 3,19,00,000/-

MONTH & YEAR OF : October, 2011.

PREPARATION

PREPARED BY : MSME - Development Institute,

Ministry of Micro, Small & Medium Enterprises,
Government of India
107, Industrial Estate, Kalpi Road,
Kanpur-208012.
Tele. 2295070, 2295071 & 2295073 (EPBAX)
Tele. No. 2295072 (SENET & TRC)
Tele/Fax No.: 0512- 2240143
email: [email protected]
Website: msmedikanpur.gov.in
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1

PROJECT PROFILE
ON
Domestic Pressure Cookers
*********************

PART-II

A) INTRODUCTION

The pressure cookers are extensively used in household for preparing food. The
pressure cookers have preference over the conventional cooking utensils due to the
advantage of retaining the nutritive value and flavour of the cooked food and less time
required for cooking and thus effecting considerable savings in time and fuel. It is a
closed cooking vessel for use with external heat source, capable of maintaining working
steam pressure of 1.0 Kg Sq. Cm. The full liquid capacity of vessel i.e. total internal
volume with lid in position, ranges from 2 to 10 litres capacity. But in market, the
pressure cookers of 3 and 5 litre capacity are mostly demanded by the customers. This
project profile envisages the manufacturing of 5 litres capacity cookers.

It is a well known fact that a pressure cooker cooks food at a pressure higher
than that of ambient pressure, thus necessitating sufficient precaution required in
designing, manufacturing and use of domestic pressure cooker to safeguard against
accidents in the kitchen.

B) MARKET POTENTIAL

It has been observed, keeping in view the average family, which medium
size/capacity pressure cookers have greater market. With the rapid advancement in the
general living standards of the people, the demand of pressure cookers is increasing
day by day. Accordingly, there is great scope for setting up of the new units for
manufacture of pressure cookers to standard specifications.
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C) BASIS & PRESUMPTIONS

1. The project profile has been prepared on the basis of single shift of 8 hours each
day, 25 days in a month and at 75% efficiency.

2. It is presumed that in the 1st year, the capacity utlisation will be 60% followed by
70% in the next year and 80% in the subsequent years.

3. The rates quoted in respect of salaries and wages for skilled workers and others
are the minimum rates in the State/neighbouring states.

4. Interest rate for fixed and working capital has been taken @ 12% on an average,
whether financed by bankers or by Financial Corporation.

5. Margin money required is minimum 30% of the project investment.

6. The rental value of the workshed and other built up/covered area has been taken
at the rate of Rs. 100/- per square meter.

7. The rates quoted in respect of machines, equipment and raw materials are those
prevailing at the time of preparation of the project profile and are likely to vary
from supplier to supplier and place to place. When a tailor made project profile is
prepared necessary changes are to be made.

D) IMPLEMENTATION SCHEDULE:

Sl. No. Activity Period

i. Preparation of project report
a) Calling quotations 1 month
b) Preparation 2 months

ii. Filing of EM-I. as MSE 1 week

iii. Financial Arrangement 2 months
iv. Purchase and procurement of machines and 2 months
equipments
v. Installation of Machinery 1 month
vi. Electrification 1 month
vii. Recruitment f Staff. 1 month
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E) TECHNICAL ASPECTS:

(i) Process of Manufacture:

The pressure cooker consists of components like main body, lid, regulator, gasket,
fusible plug, handles, lugs etc. The main body and lid of the pressure cooker are
manufactured of aluminium alloy sheet/Circles of different thicknesses depending upon
the size and specifications of the Cookers. The components i.e. pressure regulator,
Bakelite Handles and Lugs, Rubber Gasket, fusible Plugs, Screws, Rivets, Packing
Boxes etc. are usually purchased from outside sources by the pressure cooker
manufacturers. In the manufacturing of pressure cookers operations like circle cutting,
deep drawing of body, drawing of lid, trimming of body and lid, notching of body, drilling
of holes in body and lid, fixing of lugs, handles, vent pipe, buffing and polishing, testing,
packing etc. are involved.

(ii) Quality Control and Standards

The Indian Standard Specification No. IS:2347:1995 for domestic pressure cooker
and IS: 7466:1994 for Rubber Gaskets for cookers and other relevant specifications
prepared by the BIS should be followed for quality control and various tests. The
manufacturer should have arrangement to carry out the important tests in the factory
premises.

(iii) Production Capacity (Per Annum)

Quantity: 29,000 Nos. of Pressure Cookers.
Value: Rs. 3,19,00,000/-

(iv) Motive Power: 38 KW

(v) Pollution Control:

There will not be any pollution in the press shop and assembly shop. However,
exhaust fans and dust collectors will be installed in the polishing and buffing section
to control the air pollution.

(vi) Energy Conservation:

All the machines are to be provided with separate electric motors to avoid idle
running. Shunt capacitors will be installed to improve the power factor. Adequate
day light provisions are to be made in the factory shed by providing transparent
roof sheets.
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F) FINANCIAL ASPECTS:

A) Fixed Capital:

(i) Land & Building:

Built up area/covered area Rs. 30,000/-

Store and Office = 300 Sq. Mtrs.
Working Shed @ Rs. 100 Sq.Mtrs.

a) Machine Shop
b) Packing Section etc.
c) Buffing and Polishing section.

(ii) Machinery & Equipment:

Sl. Item Qty. HP Amount
No (Nos.) (Rs. Lakh)
1. Guillotine shearing machine 1250mmX4mm 1 5 3,00,000/-
capacity (aluminium) complete with standard
accessories, electric motor, switch starter etc.
2. Heavy duty circle cutting machine, 600 mm dia 1 2 50,000/-
capacity X 4 mm (aluminium) with standard
accessories electric motor, switch, starter etc.
3. Deep Drawing double action toggle press No. 5 1 15 11,00,000/-
complete with standard accessories, electric motor,
switch, starter etc.
4. Hydraulic Press 50 tonne cap. Complete with 1 3 4,00,000/-
standard accessories, electric motor, switch, starter
etc.
5. Power press 60 tonne cap. Complete with electric 1 5 3,00,000/-
motor, switch, starter etc.
6. Lathe Machine 1820 mm bed length complete with 1 2 2,00,000/-
standard accessories, electric motor, switch, starter
etc.
7. Drilling Machine bench type 12 mm cap. Complete 1 1 15,000/-
with standard accessories, electric motor, switch,
starter etc.
8. Double ended bench grinder 200 mm wheel dia 2 2 24,000/-
motorized
9. Double ended Buffing and Polishing Machine 2 4 40,000/-
motorized.
10. Testing equipments like Hydraulic Pressure Test, Air LS - 60,000/-
Leakage test Testing of pressure regulating device
etc.
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11. Workshop tools, Press Tools, Measuring tools, Work LS 1,50,000/-

Benches etc.
Total: 26,39,000/-
Electrification and Installation Charges including cost 2,64,000/-
of power connection and security deposit @ 10% of
cost of machinery and equipments.

Cost of Office Equipment Furniture etc. 50,000/-

Total Cost of Machinery & Equipments 29,44,000/-

(iii) Pre-operative Expenses: 50,000/-

Total Fixed Capital ( i + ii + iii): 30,04,000/-

B) Working Capital (Per Month):

(i) Staff & Labour:

Sl. No. Designation No. Salary Total (Rs.)

1. Engineer/Manager 1 6000/- 6,000/-
2. Accountant-cum-Typist 1 5000/- 5,000/-
Technical
3. Foreman/Supervisor 1 5000/- 5,000/-
4. Skilled Worker 2 4500/- 9,000/-
5. Semi-Skilled Workers 2 4000/- 8,000/-
6. Un-skilled Workers 2 3600/- 7,200/-
7. Peon/Chowkidar 1 2500/- 2,500/-
8. Part Time Sweeper 1 1600/- 1,600/-
Total: 44,300/-
Add Perquisites @ 15% 6,645/-
Total: 50,945/-
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(ii) Raw Material (Per Month):

Sl. Particulars Qty. Rate/Kg. Amount

No. Kg. (In Rs.)
1. Aluminium alloy sheet/circles of 8, 10 and 10800 165/- 17,82,000/-
14 S.W.G.
2. Bought out components i.e. pressure 5400 sets 83.32/ 4,50,000/-
regulator, bakelite handles and lugs, set
gaskets, fusible flugs, screws and rivets
etc.
3. Packing Boxes, Carton tape, Printed 2250 Nos. 40 90,000/-
Literature
Total: 23,22,000/-

(iii) Utilities:

1. Power 26,600/-
2. Water 400/-
Total: 27,000/-
(iv) Other Contingent Expenses (P.M.):
1 Rent 30,000/-
2 Postage and Stationery 2,000/-
3 Consumable Stores like tools, lubricants etc. 3,000/-
4 Telephone charges 1,400/-
5 Repair and Maintenance 5,000/-
6 Transportation charges 3,000/-
7 Advertisement and Publicity 10,000/-
8 Insurance 3,000/-
9 Miscellaneous Expenses 2,000/-
Total: 53,400/-

(v) Working Capital / Total Recurring Expenditure (P.M.):

1. Staff & Labour 50,945/-

2. Raw Material 23,22,000/-
3. Utilities 27,000/-
4. Other Contingent Expenses 54,000/-
Total: 24,53,945/-
Say: 24,54,000/-
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C) TOTAL CAPITAL INVESTMENT:

I. Fixed Capital 30,04,000/-

II. Working Capital for 3 months (24,54,000 X 3) 73,62,000/-
Total: 1,03,66,000/-

MACHINERY UTILISATION:
All the machines will be fully utilized. There wont be any idle capacity.

G) FINANCIAL ANALYSIS:
i) Cost of Production (Per annum)

Sl. No. Particulars Value(Rs.)

1. Total Recurring Expenditure /Cost 2,94,48,000/-
2. Depreciation on machinery and equipment @ 10% 2,76,000/-
(including pre-operative expenses)
3. Depreciation on tools, instruments and laboratory 42,000/-
equipments @ 20%
4. Depreciation on office equipment @ 20% 10,000/-
5. Interest on Total Capital Investment @ 12% 12,43,920/-
Total: - 3,10,19,920/-
Say: 3,10,20,000/-

ii) Turnover (Per Annum)

Sl. Item Quantity Rate (Rs.) Value (Rs.)

No.
1. Pressure Cookers 29,000 Nos. 1100/- 3,19,00,000/-
2. Sale of aluminium scrap 10800 Kg 150/-Kg 16,20,000/-
Total: 3,35,20,000/-

iii) NET PROFIT (Per annum) Before Taxation:

Turn Over (-) Cost of Production

= Rs. 25,00,000/-
3,35,20,000/- (-) 3,10,20,000/-

iv) PROFIT RATIO ON SALES (Per Annum):

Profit/annum X 100 25,00,000/- X 100
= 7.46%
Turnover/Annum 3,35,20,000/-
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v) RATE OF RETURN (Per Annum):

Net Profit/annum X 100 25,00,000/- X 100

= 24.12%
Total Capital Investment 1,03,66,000/-

BREAK EVEN POINT

Fixed Cost:
1. Total Depreciation Rs. 3,28,000/-
2. Rent Rs. 3,60,000/-
3. Interest Rs. 12,43,920/-
4. Insurance Rs. 36,000/-
5. 40% of Salary & Wages Rs. 2,44,540/-
6. 40% of other contingent expenses (excluding rent and Rs. 1,65,600/-
insurance).
Total:- Rs. 23,78,060/-
Say: Rs. 23,79,000/-

B.E.P.

Fixed Cost X 100 23,79,000/- X 100

= 48.76%
Fixed Cost + Profit 23,79,000/- + 25,00,000/-
Names & Address of Machinery & Equipment Suppliers:

1. M/s Sant Machine Tools Corporation, 2nd Street, Kalsi Nagar. G. T. Road,
Ludhiana.
2. M/s Basant Mechanical Works (Regd.) 720-722, Industrial Area-B, Ludhiana.
3. M/s Birdi Mechanical Works, G. T. Road, Millerganj, Ludhiana.
4. M/s Katbro Machine Tools, G. T. Road, Millerganj, Ludhiana.
5. M/s Surinder Machinery Works (Regd.), Nirankari St. No.2, G. T. Road,
Millerganj, Ludhiana.
6. M/s Sargodha Machinery Corporation, Near Manju Cinema, G. T. Road,
Ludhiana.
7. M/s Pal Mechanical Works, Street No. 2, Partap Nagar, Ludhiana.

Raw Material Suppliers:

Raw materials are easily available in the local market.
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PSB*Oct*2011*