Automotive Chain (Motorcycle Chain)

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Product Code 343401002
Quality and Standards IS 11740:1986
Production Capacity Qty. : 10,26,000 in Nos. (per annum)
Value : Rs. 13,68,00,000


Chain is an important link to transfer power from engine of a motorcycle to the rear driving wheel through sprockets. Automotive chains are of different sizes based upon the power to be transmitted. The size employed upon the most popular motorcycle in the Indian market is of 12.7 mm × 8 mm dia × 7.85 mm width rollers. The lengths of the chain for such models of motorcycles are either of 120 links or 118 links. This scheme is based on 120 links.

Market Potential

Motorcycle has become a common mode of conveyance as a result of modern life style. As the population is rapidly increasing day by day, the demand of motorcycles is also increasing. As such, there is a demand for motorcycle chains to meet the replacement market as well as for supply to the O.E.M. units.

Therefore, there is a great potential for this item and considerable scope to set up new units in this line.

Basis and Presumptions

  • 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.
  • It is presumed that in the first year, the capacity utilisation will be 60% followed by 70% in the next year and 80% in the subsequent years.
  • The rates of salaries and wages for skilled workers and others are the minimum rates in the State/ Neighbouring States.
  • Interest rate for fixed and working capital has been taken on an average rate of 12% whether financed by bankers or by Financial Corporations.
  • Margin money required is minimum 30% of the project investment.
  • The land, working shed and civil construction has been taken in the project cost.
  • The rates quoted in respect of machines, equipment and raw materials are those, prevailing at the time of preparation of this 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.

Implementation Schedule



Preparation of Project Report  
a) Calling quotations 1 Month
b) Preparation 2 Weeks
Provisional Registration as SSI 1 Week
Financial Arrangement 3 Months
Purchase and procurement of machines and equipments 2 Months
Installation of Machines 1 Month
Electrification 1 Month
Recruitment of Staff and Workers 1 Month

Technical Aspects

Process of Manufacture

  • Outer and inner link blank are cut from cold rolled steel strips on S.P.M. with progressive die sets.
  • Rollers are drawn into cups on compound die sets from CR steel strips and then pierced on an automatic S.P.M.
  • Bushes are manufactured by curling process on a S.P.M. from cold rolled strip with rounded edges.
  • Pins are cut on an automatic Header Machine to required length.
  • Barrelling
  • Heat Treatment
  • Barrelling
  • Colouring
  • Block Assembly on automatic machine.
  • Chain assembly on automatic machines.
  • Rivetting
  • Greasing
  • Packing.

Quality Control and Standards

BIS has prepared a standard specification No. IS 11740 :1986 on chains for motorcycle and the quality should conform to the same.

Production Capacity (per annum)



Amount(In Rs.)

Automotive Chain
(Motorcycle Chain)
342000 Nos. (Excluding 5% provision made for stage rejections) 2,39,40,000

Pollution Control

The building/workshed, specially heat treatment section is to be provided with exhaust fans. Provision has also been made for neutralising of the cyanide salts. Necessary permission from Pollution Control Department/ Board is required.

Energy Conservation

  • Machine Shop should be well ventilated and should have transparent roof sheets to get sufficient light during day time.
  • The periodic maintenance of Machines should be carried out.
  • Shunt capacitors should be used to improve the power factor.

Financial Aspects

Fixed Capital

(i) Land and Building  
Land requirement ; 1000 sq. Mtr : @ Rs. 3500 per sq. Mtr.: Rs. 35,00,000
Raw material and finished goods store, office, maintenance room, laboratory, workers room, security room, pollution control area, DG set, raw water and bore well, general store room 250 Sq. Mtr @ 7000 / Sq. Mtr. Rs. 17,50,000
Working Shed 400 Sq. Mtr @ Rs. 6000 / sq. mtr Rs. 24,00,000
Heat treatment section, 75 @ Rs. 7000/Sq. mtr Rs. 5,25,000
Packing Section 25 Sq. Mtr Rs. 7000/ Sq. Mtr Rs. 1,75,000
Land development, boundry wall ,gates and inside roads Rs. 5,00,000
Total civil cost : (Land cost + building costs) Rs. 88,50,000

(ii) Machinery and Equipments




Amount (In Rs.)

Production unit
Single action power press cap. 75 tonnes complete with automatic feeding system and electricals etc. 2 15 10,00,000
Single action power press cap. 10 ton complete with electricals 1 2 1,00,000
Single action power press cap. 50 tonnes complete with automatic feeding system and electricals etc. 1 5 3,00,000
Special purpose roller cups Punching Machine complete with automatic feeding systems and electricals etc. 2 2 2,50,000
Special purpose curling and cutting machine complete with automatic feeding system and electrical etc. 2 4 5,00,000
Special purpose bush making and sizing machine complete with automatic feeding system and electricals 2 3 4,00,000
Automatic header machine for cutting of rivetting pins complete with electricals etc. 1 2 1,00,000
Automatic special purpose lock pin turning machine complete with electricals etc. 1 1 1,00,000
Tumbling barrels complete with gear box motor and electricals etc. 4 8 2,50,000
30 KW electric rotary retort type gas carborising furnace 30 Kg. Cap, complete with electricals etc. 2 100 2,00,000
15 KW salt bath furnace electrically operated charge cap. 30 Kg. 2 40 600,000
Automatic chain block assembly machine complete with electricals and feeding system. 2 4 10,00,000
Automatic chain assembly machine complete with electricals etc. 2 4 7,00,000
Pneumatic chain stretching machine complete with 1 HP Compressor and electricals 1 2 3,00,000
Total     58,00,000

Testing Section

Hardness Testing machine with spare set of diamonds and steel balls and standard test samples 1   3,00,000
Chain fatigue testing machine 1 2 2,00,000
Total     5,00,000

Tool Room And Machine Section

1500 mm Bed sliding surfacing and screw cutting centre lathe machine complete with electric motor, starter etc. 1 2 3,00,000
500mm × 200mm traverse Horizontal spindle surface grinding machine complete with electricals etc. 1 1.5 1,00,000
12mm cap. Precision drilling machine complete with electricals etc. and double ended bench grinder 200MM wheel dia with motor 1 0.5 50,000
DG set with accessories, Raw water with storage piping and pumping, electrical transformer and other utilities     20,00,000
24" stroke shaping machine complete with electric motor and other electricals etc. 1 3 1,50,000
Universal milling machine size No. 2 alongwith vertical attachment and dividing head complete with electricals 1 5 5,00,000
Pollution Control Equipment   3 8,00,000
Marking and measuring instruments     3,00,000
Special purpose toolings and other petty equipments     7,50,000
Total     49,50,000

Total Fixed Capital Investment


Amount (In Rs.)

Electrification and Installation
(i) Charges including cost of power connection and security deposit @ 10% of cost of machinery and equipment, 30% of plant and m/c cost as excise, sales tax and other expenses. 45,00,000
(ii) Total Cost of Machinery and Equipments 1,12,50,000
(iii) Cost of Office Equipment, Furniture 5,00,000
(iv) Pre-operative Expenses 7,50,000
Total plant and machinery cost
(i +ii + iii+iv)
Total fixed cost = Total civil cost + total plant and machinery cost= Rs. 88,50,000+Rs. 1,70,00,000 2,58,50,000

B. Working Capital (per month)

(i) Personnel



Salary (Rs.)

Amount (In Rs.)

General Manager 1 30,000 30,000
Production Manager, production supervisors, Laboratory chemists, Maintenance engineer, supervisors, 10   2,00,000
Finance manager, and his team 1 2500 40,000
Commercial manager and his team consisting of sales and marketing and purchase and administration team 6 2000 1,00,000
Foreman 7 5000 35,000
Heat Treater 4 5000 20,000
Skilled Worker 50 4000 2,00,000
Semi-skilled Worker 24 3500 84,000
Peon/Chowkidar 10 3000 30,000
Sweeper 3 3000 9,000
Total 7,48,000
Add Per-quisites @ 22% of salary 1,65,000
Total 9,13,000

(ii) Raw Materials Including Packaging Requirements


Qty. MT

Amount (In Rs.)

Medium carbon steel sheet 19 SWG 81 36,45,000
CRCA, DD Grade steel strips 19 SWG 25 10,00,000
CR. Steel strip 11 mm × 1 mm thick with Rounded edges (rolled from wire) 16.5 7,43,000
Low Carbon 4.5mm dia steel wire 25.5 12,00,000
Liquid carburising materials 12,000 liters 2,00,000
Ammonia Gas 75 Cylinders 3,00,000
Packaging cartons etc. 90000 Nos. 1,50,000
Misc. O/B items   5,00,000
Total   77,38,000

(iii) Utilities


(In Rs.)

Power 69120 units @ Rs. 4.0/unit 2,76,000
Water 5,000
Total 2,81,000

(iv) Other Contingent Expenses


(In Rs.)

Postage and Stationery 20,000
Consumable Stores 1,00,000
Telephone and communication expenses 20,000
Repair and Maintenance 28,000
Transport Charges 20,000
Advertisement and publicity 40,000
Insurance 14,000
Sales Expenses 3,00,000
Miscellaneous Expenses 2,00,000
Total 7,42,000

(v) Total Recurring Expenditure (per month)


(In Rs.)

Raw Material 77,38,000
Personnel 9,13,000
Utilities 2,81,000
Other Contingent Expenses 7,42,000
Total 96,74,000

Working Capital (for 3 months) 96,74,000 × 3 = Rs. 2,90.22,000

C. Total Capital Investment

(i) Fixed Capital Rs. 2,58,50,000
(ii) Working capital for 3 months Rs. 2,90,22,000
Total Rs. 5,48,72,000

Financial Analysis

Cost of Production (per year)

(In Rs.)

(i) Total recurring cost 11,60,88,000
(ii) Depreciation on pl. and m/c @ 10% 15,50,000
(iii) Depreciation on Dies / Tools/ measuring instruments etc. @ 20% 2,00,000
(iv) Depreciation on office equipment @20% 1,00,000
(v) Interest on total investment @ 12% 65,85,000
(vi) Depreciation on civil construction @ 5% 2,68,000
Total 12,47,91,000

Turnover (per year)



Rate (Rs.)

Value (Rs.)

Motorcycle Chain 1026000 Nos. 133.33/ chain 13,68,00,000

Net Profit (per year) (Before Income Tax)

Profit = Sales - Production Cost
  = Rs. 13,68,00,000 – 12,47,91,000
  = Rs. 1,20,09,000

Net Profit Ratio

  Net Profit per year×100
  Turnover per year
  1,20,09,000 × 100
  = 13,68,00,000
  = 8.8%

Rate of Return

  Net Profit per Year ×100
  Total Investment
  1,20,09,000 × 100
  = 5,48,72,000
  = 21.88%

Break-even Point (% of total Production envisaged)

Fixed Cost

(In Rs.)

Total Depreciation 21,18,000
Total interest 65,85,000
40% of salary and wages 43,82,000
40% of other contingent expenses 35,61,000
Total 1,66,46,000
(ii) Net Profit (per year) Rs. 1,66,46,000

B.E.P Fixed cost × 100
  Fixed cost + Profit
  1,66,46,000 X100
  16646000 + 1,20,09,000
  = 58.09%

Addresses of Machinery Suppliers

  • M/s. Milton Machine Tools
    P.B. No. 30,
    Sonepat (Haryana)
  • M/s. Godly Machine Tools (P) Ltd.
    C-190, Phase-VI,
    Focal Point, Ludhiana.
  • M/s. Research and Development
    Centre for Bicycle and Sewing
    Machines, Focal Point,
  • M/s. Vishkarma Electric Furnaces
    St. No. 2, Partap Nagar,
  • M/s. Kalsi Machine Tools
    Gill Road,
  • M/s. Simplicity Furnaces Ltd.
    55-B, Phase-II, Mayapuri,
    New Delhi.
  • M/s. Sant Machine Tools
    G.T. Road, Near Dholewal Chowk,
  • M/s. Raj Enterprises
    628, Industrial Area-B,
  • M/s. Basant Mechanical Works (Regd.)
    720-722, Basant Road,
    Industrial Area–B,
  • M/s. Deep Industries
    Oswal Street No. 1,
    Industrial Area–B,

Addresses of Machinery Suppliers

  • M/s. Rolled Strips and Profiles Ltd.
    Karur (Kerla).
  • M/s. Avon Cycles Ltd.
  • M/s. Special Steels Ltd.
    Mumbai and Bhagwan Chowk,
  • M/s. Steel Strips Ltd.
    Industrial Area-B,
  • State Small Industries and Export Corporations.
  • M/s. Steel Authority of India Ltd.
  • Open Market.

For further information please contact

Information Manager
TIMEIS Project