Auto Pistons
| Product Code |
N.A. |
| Quality and Standards |
IS 6331:1971
(Or as per Customer’s Specifications) |
| Uploaded on |
February 2007 |
Introduction
The automobile Industry manufacturing Motor Cycles, Scooters and Mopeds has made fast progress with the liberalization of two wheeler policy in 1980. The break-through for auto components came around the year1960 when a number of Small Scale Units started manufacturing auto components like forgings, castings, sheet metal components etc. The auto components industry has a wide range of components and this project profile envisages the manufacture of graded C.I. Auto Pistons.
Market Potential
The market potential for Cast Iron Auto Pistons has increased during last three decades with the development of automobile industries in the country. The economic status of the public is improving and it is within the capacity of every family to purchase at least a moped.
Basis and Presumptions
- For capacity utilization, it is considered that 60% efficiency and 24 Hrs. per day plant operation is required.
- Four years required for achieving full capacity utilization.
- Labour and wages amount as per local market rates.
- Interest rate for fixed and working capital is 12% per annum.
- The margin money requirement for obtaining financial assistance is 30% of the fixed capital.
Implementation Schedule
Preparation of Project Report
Activity |
Period in Months |
a) Calling Quotations
b) Preparation of Report 2 weeks |
1 |
| Provisional Registration as SSI Unit |
1 |
| Financial Arrangements |
3 |
| N.O.C. from Pollution Control Board |
1 |
| Purchase and Procurement of Machinery and Equipments |
3 |
| Installation of Machinery and Equipments |
1 |
| Electrification |
1 |
| Recruitment of Staff and Workers |
1 |
Technical Aspects
Process of Manufacture
The manufacturing process involves melting of Pig Iron and graded scrap in cupola furnace. Green sand moulds are prepared by mixing sand and molasses. Moulds are dried and assembled with cores, molten metal when ready is poured into the prepared and dried moulds. Castings after cooling are taken out from moulds and runners, and the semi finished castings are machined as per drawing. The detailed process flow chart is as follows
Incoming Inspection
 |
Sand Preparation
|
Moulding
|
Shot Blasting
|
Knock Out
|
Pouring Charging and Melting
|
Fettling
|
Inspection
|
Machining
|
Cleaning
|
Assembly
|
Despatch
|
Packing
|
Final
Inspection
|
Testing
|
Quality Control and Standards
Auto Pistons are produced to serve specific mechanical properties, chemical composition and micro structure. Accordingly, a close control of quality at each stage of manufacturing is essential. Quality control methods usually applied are carbon equivalent determination, hardness determination, tensile strength test, determination of other alloying elements by chemical analysis, etc.
Production Capacity
The production capacity in this scheme is 600 tons of un-machined C.I. Auto Pistons. The capacity is about 60% of the installed capacity on the basis of 300 days in a year.
Pollution Control
The process involves melting of Pig Iron in Cupola Furnace and because of burning of coke pollution occurs. The mixing of sand and fettling of casting is also a cause of pollution in work-shed. In order to avoid/minimize pollution, the chimney for outlet of burning gases/fumes should be of proper height as per recommendations of Pollution Control Board. Secondly, the work-shed height and ventilation measures should be maintained as per standards framed for industrial sheds.
Financial Aspects
Fixed Capital
| (i) Land and Building |
|
Amount (In Rs.) |
| Land - 4000 Sq. Mtr. |
@ Rs. 3500 per sq. Mtr |
1,40,00,000 |
| Foundry Shop, workshop, testing, pollution control, D.G. room and electrical area, workers room, Bore well and raw water system, laboratory, raw material and finished goods storage, store and maintenance room, Offices and staff rooms, car and cycle parking area etc. |
2000 Sq. Mtr. @ Rs. 7500/ Mtr |
1,50,00,000 |
| Store Office Boundry Wall, Gate roads etc. |
|
10,00,000 |
| Total |
|
3,00,00,000 |
(ii) Machinery and Equipment
Description |
Qty. |
Rate (In Rs.) |
Amount
(In Rs.) |
| (A) Production Unit |
| Cupola Furnace |
1 |
18,00,000 |
18,00,000 |
| Sand Muller (Motorised) |
1 |
2,00,000 |
200,000 |
| Sand Siever |
1 |
50,000 |
50,000 |
| Pin Lift Type Moulding Machine |
6 |
75,000 |
4,50,000 |
| Pneumatic Moulding Machine |
2 |
1,00,000 |
2,00,000 |
| Snagging Grinder |
1 |
50,000 |
50,000 |
| Bench Grinder |
1 |
30,000 |
30,000 |
| Electric Core Oven |
1 |
2,00,000 |
2,00,000 |
| Pillar Type Drilling Machine |
1 |
1,00,000 |
1,00,000 |
| Lathe Machine |
1 |
12,00,000 |
12,00,000 |
| Tapping Machine |
2 |
1,00,000 |
2,00,000 |
| CNC Vertical Machining Centre |
1 |
40,00,000 |
40,00,000 |
| Centre Lathe Machine |
4 |
7,00,000 |
28,00,000 |
| Vertical Milling Machine |
2 |
6,00,000 |
12,00,000 |
| Ultra Sonic Cleaning Machine |
1 |
2,00,000 |
2,00,000 |
| Washing Machine |
1 |
1,00,000 |
1,00,000 |
| Welding Machine |
2 |
50,000 |
1,00,000 |
| Hand Drill Machine |
2 |
2,500 |
5,000 |
| Screw Type Air Compressor |
1 |
1,00,000 |
1,00,000 |
| Mould Boxes |
L.S. |
|
2,00,000 |
| Patterns and Foundry Tools |
L.S. |
25,000 |
50,000 |
| Platform Type Weighing Machine |
1 |
50,000 |
50,000 |
| Material Handling Trolleys |
6 |
5000 |
90,000 |
| Diesel Engine and fuel system, Bore well and raw water system |
|
|
10,00,000 |
| Pollution Control Equipment |
1 |
5,00,000 |
5,00,000 |
| Office Furniture |
L.S. |
8,00,000 |
8,00,000 |
| Electrification/ Installation, excise, sales tax, freight, transportation @ 30% of the total |
|
|
4,702,000 |
| Total |
|
|
2,03,77,000 |
| (B) Quality Control and Testing Equipments |
| Total |
|
|
5,00,000 |
| Total (A + B) |
|
|
2,08,77,000 |
| (iii) Pre-operative Expenses |
Rs. 8,00,000 |
| (iv) |
Rs.2,16,77,000 |
Working Capital (per month)
(i) Raw Material
Designation |
Qty. |
Rate (In Rs.)/MT |
Amount (In Rs.) |
| Pig Iron |
450 MT |
15,000 |
67,50,000 |
| M.S. Scrap |
60 MT |
15,000 |
9,00,000 |
| Ferro Alloys i.e Ferro Silicon, Ferro Manganese, Ferro Chrome, Ferro Nickel |
L.S. |
- |
9,00,000 |
| Sand |
L.S. |
- |
30,000 |
| Lime Stone |
L.S. |
- |
30,000 |
| Graphite Powder |
L.S. |
- |
30,000 |
| Thermocouple Tips |
L.S. |
- |
25,000 |
| Grinding Wheel |
L.S. |
- |
25,000 |
| Foundry Coke |
4 MT |
9,000 |
1,50,000 |
Kerosene, Oil, Lubricating Oil,
Grease etc. |
L.S. |
|
1,00,000 |
| Total |
89,40,000 |
Personnel
Particulars |
Nos |
Salary (In Rs.) |
Amount (In Rs.) |
| General Manager |
1 |
40,000 |
40,000 |
| Production Manager |
1 |
30,000 |
30,000 |
| Q.C. In-charge and laboratory chemists |
5 |
|
60,000 |
| Marketing, Sales, Purchase administrative officers and staff |
10 |
|
1,00,000 |
| Skilled Workers |
25 |
4,000 |
1,00,000 |
| Un-skilled Workers |
50 |
3,000 |
1,50,000 |
| Watchmen |
4 |
3,000 |
12,000 |
| Peon |
3 |
3,000 |
9,000 |
| Perks to Staff @ 22% |
|
|
1,10,000 |
| Total |
|
|
6,11,000 |
(iii) Utilities
| |
Amt.(In Rs.) |
| Power |
1,50,000 |
| Water |
10,000 |
| Total |
160 ,000 |
(iv) Other Contingent Expenses
| |
(In Rs.) |
| Publicity |
25,000 |
| Postal Charges |
10,000 |
| Stationery |
5,000 |
| Telephone |
20,000 |
| Transportation |
2,00,000 |
| Consumable Items |
20,000 |
| Repairs and Renewal |
51,000 |
| Insurance |
17,000 |
| Packing Material |
25,000 |
| Total |
3,73,000 |
| Other Contingent expenses |
123000 |
| Total |
8736200 |
| Total Recurring Expenditure (i + ii + iii + iv) Rs. |
= 1,00,84,000 |
| Total Working Capital for 3 Months Total Recurring Expenditure ×3 Rs. |
= 3,02,52,000 |
Total Capital Investment
| (i) Total Fixed Capital Rs. |
2,16,77,000 |
| (ii) Total Working Capital Rs. |
3,02,52,000 |
| Total |
5,19,29,000 |
Financial Analysis
Cost of Production (per year) |
(In Rs.) |
| Total Recurring Cost |
12,10,08,000 |
| Depreciation on Building @ 5% |
8,00,000 |
| Depreciation on Machinery @ 10% |
18,28,000 |
| Depreciation on Furnace @ 20% |
3,60,000 |
| Depreciation on Office Equipment @20% |
100,000 |
| Interest on Total Investment @12% |
62,31,000 |
| Total |
13,03,27,000 |
Turnover (per year)
Item |
Qty. |
Rate (Rs.) |
Amount (Rs.) |
| Piston |
12,96,000 Pieces |
125.7 per Piece |
16,29,09,000 |
Net Profit (per year) (Before Income Tax)
| |
Total Sales –Cost of Production |
| |
Rs.16,29,09,000 – 13,03,27,000 |
| |
= Rs.3,52,82,000 |
Net Profit Ratio
| |
Net Profit per annum × 100 |
| |
Turnover per annum |
| |
3,52,82,000×100 |
| |
16,29,09,000 |
| |
= 20% |
Rate of Return
| |
Net Profit per annum × 100 |
| |
Total Capital Investment |
| |
3,52,82,000×100 |
| |
5,19,29,000 |
| |
= 67.9% |
Break-even Point
Fixed Cost (per annum) |
(In Rs.) |
| Depreciation on Plant and Machinery |
18,28,000 |
| Depreciation on Furnace |
3,60,000 |
| Depreciation on Office Equipments & building |
9,00,000 |
| Interest on Total Investment |
62,31,000 |
| Insurance |
2,04,000 |
| 40% of Salary and Wages |
29,33,000 |
| 40% of Other Contingent Expenses |
17,90,000 |
| Total |
1,42,46,000 |
| B.E.P |
Fixed Cost ×100
|
| |
Fixed Cost + Profit per annum |
| |
1,42,46,000 ×100 |
| |
1,42,46,000 + 3,52,82,000 |
| |
50,82,000 ×100 |
| |
92,79,000 |
| |
= 28.76% |
Addresses of Machinery and Equipment Suppliers
- M/s. R.P. Sales Corpn.
501, Bldg. No. 11,
Tulsidham Complex,
Near Tatvadnyan Vidyapeeth,
Ghodbunder,
Thane, (Maharashtra)
- M/s. HMT Ltd.
Machine Tool Mktg. Division,
59, Bellary Road,
Bangalore - 32.
- M/s. Versatile Equipments Pvt. Ltd.
B-69, MIDC,
Gokul Shirgaon,
Kolhapur - 34,
(Maharashtra)
For further information please contact
Information Manager
TIMEIS Project
E-mail: timeis@ficci.com
