Domestic LPG Stove

Introduction

L.P.G is the most convenient and clean fuel for domestic use and is very popular in these days. The LPG stove industry is about 36 years old and is mainly concentrated in the small-scale sector. LPG is a by product formed during petroleum distillation and is stored and marketed in gas cylinders of 14.2 KG capacity and used generally for cooking stoves and to some extent for industrial purpose also. The domestic LPG stove is primarily being used in the urban areas as well as in rural areas. The industry of domestic LPG stove has grown considerably over the last 18 years and offers a wide range of products i.e.:

i) Gas stove with one burner,
ii) Gas stove with two burners,
iii) Gas stove with two burners, one grill also called as cooking grill,
iv) Gas stove with three burners,
v) Gas stove with four burners etc.

Market Potential

In 1980, the Government of India had planned to push the exploration and production of LPG from Bombay High Project, thereby providing tremendous push to the LPG Stove Industry. More and more number of new connections are being released by the Govt. and therefore the demand of LPG stove is also increasing day by day. As per the last Census, there were 186, units manufacturing LPG stoves in India. Out of them, 139 were from SSI sector. Most of the units are located in the state of Delhi and Haryana.

Basis and Presumptions

1. The basis for calculation of production capacity is on double shift , working of 25 days per month on 75% efficiency. The time period required for achieving envisaged capacity utilization is assumed as one year.

2. Break-even Point for the scheme has been calculated on full capacity utilization.

3. Rate of interest has been taken @ 12% on an average. This, however, is likely to change depending upon the location of
the project.

4. Labour wages have been taken on the basis of applicable rates in industry. These are likely to change depending upon the location of the project.

Building is considered of own

6. Margin money requirement differs from project to project and type of entrepreneurs such as women, SC/ST, physically handicapped etc. and the minimum margin money usually asked by the financial institutions and banks is 15%. Margin money up to 25% in some cases is also asked. The entrepreneurs may check the margin money requirement from financial institutions for the project.

7. Terms of loan differ from one financial institution to another and in general minimum gestation period is 6 months and it could be 2 years also. Maximum period for repayment of loan is 7 years including gestation period. The entrepreneurs may find the exact terms and conditions from the concerned financial institutions .

8. The cost of machinery and equipments as indicated in the scheme is approximate ruling at the time of preparation of the scheme. The entrepreneur may check the exact price for specific make and model of the machine selected.

9. Non-refundable deposits, cost of preparation of project report etc. may be considered under preoperative expenses.

10. The provision made in other respects viz; raw materials, utilities, overheads etc. is drawn on the basis of standard variation and output. The cost indicated against each is approximate based upon local market conditions and observations. The entrepreneur may find out the exact cost from the concerned sources.

11. The operative period of this project is estimated to be about 10 years considering technology obsolescence.

12. Calculations are based on manufacture of double burner stove only.

Implementation Schedule

It is envisaged that from the conception to commercial production, it may take about one and half years, which also includes time for preparation of project report, provisional registration, procurement of Machinery and Equipments, their installation and electrification, clearance from all local authorities, obtaining loan from financial institutions. However, the duration for implementation of project/unit may vary depending upon the circumstance.

Technical Aspects
Process of Manufacture

C.R. sheet is to be cut according to the desired length and width on the guillotine-shearing machine. Then it has to be fed in the double action deep draw press for giving shape of the body of LPG stove. The holes may be cut on power press in the body and burr must be removed. After that, the small holes may be done on drilling machine. Then it may be sent for Ni-crome plating from outside of MC Limit. Then all bought out components like burners, burner tops, pan supporting casting, Gas pipe assembly, gas cook assembly knobs, rubber rolls and name plates etc. are to be fitted on the body. Finally the stove must be tested as per ISI mark requirement and packed for despatching/selling.

Quality Control and Standards

The LPG stove may be manufactured and checked according to IS 4246:1984, IS 11480:1985 and IS 5116:1985. The following testing facilities are required for getting ISI certification mark:

i) Strength testing equipment.
ii) Thermal efficiency apparatus.
iii) Combustion apparatus.
iv) Gas soundness testing equipment.
v) Floor wall and ceiling temperaturemeasuring equipment.
vi) Gas consumption testing apparatus.

Production Capacity (per annum)

Pollution Control

No pollution control is required in the unit as the unit has to get nickel crome plating from outside. However, the general feature for pollution control must be taken into consideration during the process of the unit.

Energy Conservation

General precautions must be taken into consideration to conserve energy such as shunt capacitors must be used on electric motors and carbide gas must be used with due care while welding and general lighting system.

Financial Aspects
A Fixed Capital

(ii) Machinery and Equipment

B. Working Capital (per month)
(i) Salary and Wages

(ii) Raw Material (per month)

Total Capital Investment

Machinery Utilisation

The number of machines to be installed has been determined in such a way that planned schedule of process will not cause any bottleneck in operation during bulk production. As such the unit will make utilization of machinery envisaged.

Financial Analysis

(6) Break-even Point

Addresses of Machinery and Equipment Suppliers

Addresses of Machinery Suppliers
1. M/s. Essential Machine Tools (P) Ltd.
5, Nyayamurthi, G.N Vaidya Marg,
Post Box No. 2, Behind State Bank, Fort,
Mumbai-400001

2.. M/s. Dutta Engg. Works
C-162, Mayapuri Indl. Area,
Phase-II,
New Delhi.

3. M/s. JNW Engineers
Commercial Complex,
Mayapuri Indl. Area, Phase-I,
New Delhi.

4. M/s. United Machine Co.
B-96, Mayapuri Indl. Area,
New Delhi.

5. M/s. Prem Engg. Works
20, Okhla Indl. Area,
New Delhi-110020.

6. M/s. Patel Indl. Corporation
2-B, DLF Indl. Area,
Nazafgarh Road,
New Delhi.

7. M/s. Mahalaxmi Engg. Works
20, DLF Indl. Area,
Nazafgarh Road,
New Delhi.

8. M/s. Simplicity Engineers
B-99, Mayapuri Indl. Area,
New Delhi.

9. M/s. Atlas Engg. Works
G. T. Road,
Batala

10. M/s. P. K. Engg. Works
B-1, Indl. Estate,
Aligarh.

11. M/s. S.S. Mechanical Works
Indl. Estate–B,
Ludhiana.

Raw Material Suppliers

Raw Material can be purchased fromlocal market, as it is available easily.Moreover, it can also be had from theGovernment Depots and Corporations.

Contact for more information:

Information Manager
TIMEIS Project
E-mail: timeis@ficci.com