Galvanised M.S. Wire
| Product Code | N.A. |
| Quality and Standards | IS 280 : 1977 IS 2629 : 1985 IS 2633 : 1986 IS 6745 : 1972 |
| Production Capacity | 3480 Ton (per year) |
| Uploaded on | February 2007 |
Introduction
Galvanized M.S. Wire has versatile use in producing different Engineering items such as Building Hardwares, barbed wires, Screens rivets etc. Special quality of wire is also required for producing special purpose fastners, reinforcement wire etc. The Galvanized M.S. Wire is a Mild Wire which is coated with a layer of Zinc. The coating of Zinc provides cathodic protection to underneath steel surface. The Galvanised M.S. Wire offers better surface protection at lower cost in humid atmosphere.
Market Potential
The Galvanized M.S. Wire has very good demand for its versatile use in different applications. There is a large demand for this item from the down stream industries.
With the availability of appropriate technology, the activity is highly feasible in the small scale sector and marketing is generally not a problem.
Basis and Presumptions
The profile is drawn on the basis of the following presumptions:
| Working hours / shift | 24 hr. per day |
| No. of Shifts per day | Three |
| No. of working day/year | 300 |
| Total no. of working hours | 7200 hrs. |
| Working efficiency | 75% |
| Time period for achieving maximum capacity utilization | 3 years from the date on which production will be started |
| Labour charges | As per local market. |
| Rate of Bank Interest | 12% per annum |
The value of machinery and equipment is estimated on the basis of prevailing market rates. It is expected that it may take about 8 to 9 months to complete all activities of the project, till commercial production is achieved. If the project is available with the promoter, a period of 8/9 months will be needed for site selection, Registration with DIC as SSI unit, Building construction, selection and purchase of plant and machinery, Loan sanction from financial Institution, Erection and commissioning of Project for trial run etc.
Implementation Schedule
Standardizations parameters are as follows:
- 1. IS:280-1977 specification for Mild Steel wire for general purposes.
- IS:2629-1985, IS:2633-1986, IS:6745-1972 to test the quality of galvanization.
Production Capacity (per year)
The production target of Galvanised M.S. Wire 1160 MT per year.
| Quantity | 3480 MT |
| Value | 20,29,40,000 |
Technical Aspects
Process of Manufacture
The production process of Galvanized M.S. Wire is as follows:
Pickling/Cleaning of the wire rod to remove surface oxides and impurities —> Mechanical Scraping of the wire rod surface —> Painting/Welding of Wire Rod —> Drawing of wire at various stages —> Annealing of wire if required —> The final drawing in continuous wire drawing machine —> Pre treatment of M.S. Wire cleaning and degreasing by special solvent like Sodium hydroxide solution and followed by pickling —>Galvanizing of M.S. Wire by immersing of M.S. wire in the molten bath of Zinc followed by water quenching —> Inspection of Galvanized M.S. Wire —> Binding of wire coil, packing etc.
Financial Aspects
A. Fixed Capital
(i) Land and Building |
|
| Land Required = 2000 Sq. Mtr. @ 3500 / sq. Mtr. = Rs. 70, 00,000 Civil and building Construction; Boundry wall, gates and roads inside the factory premises Lump sum cost = Rs. 8,00,000 Building for factory, raw material and finished store, raw water system and bore well, DG set room, pollution control system room/ area, maintenance room, laboratory room, consumable stores, security room, workers room, offices for management, technical, commercial, financial and accounts and administrative staff 1200 Sq. mtr @ Rs. 7000/ sq. Mtr Value = Rs. 84,00,000 |
Rs. 1,40,00,000 |
(ii) Machinery and Equipments
Name of Machinery and Equipment |
Qty. |
Amount(In Rs.) |
| Heavy Duty Wire Drawing Bull Block intake capacity upto 10 mm of M.S. Wire rod with 660 mm Capstan and 40 HP motor complete with reduction gear box etc. | 1 No. | 8,00,000 |
| Electric Motor 40 HP Sliping type for the above complete with Switch gear Control panel, etc. | 1 set | 4,00,000 |
| Set of continuous Wire Drawing Machine Intake capacity for 6 mm of M.S. Wire with 550 mm Capstan and 25 H.P. Motor complete with reduction gear Box etc. | 4 sets | 16,00,000 |
| Set of Electric Motor of 25 HP for the above complete with Control Panel etc. | 4 sets | 10,00,000 |
| Mechanical Desealer cap. Up to 10 mm of Wire rod complete with reduction gears Take off Drum and 10 HP motor and Electrical | 1 No. | 1,50,000 |
| Wire pointing Machine with electric motor of 3 HP | 1 No. | 1,00,000 |
| Wire Butt Welding Machine suitable to weld M.S. Wire up to 10 mm | 1 No. | 50,000 |
| Electric Furnace Bell type for Annealing of Wire Coil rating 20 KW | 1 No. | 5,00,000 |
| Hot Diping galvanizing unit consist of Pickling, Washing Flux Tank, Diesel Furnace, Zinc Bath, Extraction unit and Pot | L.S. | 15,00,000 |
| Electric Hoist of 1 ton capacity, DG set with accessories like oil tank, chimney etc., bore well water storage and distribution sytem, pollution control system | - | 20,00,000 |
| Testing Equipment | ||
| Wire Testing Machine cap. 2 ton | L.S. | 3,00,000 |
| Equipment for coating test | LS | 1,00,000 |
| Gauges for Dimensional measurement of wire | LS | 50,000 |
| Excise, sales tax, electrification and installation @ 40 % of cost of Machinery and equipment | - | 34,20,000 |
| Cost of Dies of various sizes | - | 3,00,000 |
| Office equipment and furniture | - | 7,00,000 |
| Pre-operative Expenses | - | 3,00,000 |
| Total | 1,32,70,000 | |
B. Working Capital (per month)
(i) Staff and Labour
Administrative Staff |
Qty. |
Salary (In Rs.) |
Amount(In Rs.) |
| General Manager | 1 | 25,000 | 25,000 |
| Sales and marketing personnel . | 4 | 40,000 | |
| Purchase and other commercial staff | 2 | 15,000 | |
| Finance and accounts staff | 3 | 20,000 | |
| Peon/Watchman | 8 | 3000 | 24,000 |
| Workshop Staff | |||
| Production manager, shift supervisors, maintenance staff, laboratory chemists | 1,50,000 | ||
| Skilled Workers | 30 | 5,000 | 1,50,000 |
| Semi skilled workers Helpers | 15 | 3,000 | 45,000 |
| Total salary and wages | 4,69,000 | ||
| Add perquisites @ 22% / annum | 1,03,000 | ||
| Total | 5,72,000 | ||
(ii) Raw Material
Particulars |
Qty. |
Rate (In Rs.) |
Amount (In Rs.) |
| Mild Steel Wire rod of 8, 9 and 10 mm Dia. | 300 ton | 36,000 per ton | 1,08,00,000 |
| Zinc Ingot | 15 ton | 1,65,000 ton | 24,75,000 |
| Acid Fluxes and other additives | L.S. | - | 4,00,000 |
| Total | 1,36,75,000 | ||
(iii) Utilities |
Amount (In Rs.) |
|
| Electricity and Water | L.S. | 100,000 |
| Water | L.S. | 5,000 |
| Fuel | L.S. | 1,50,000 |
| Total | 2,55,000 | |
(iv) Other Contingent Expenses |
Rs |
| Postage and Stationery | 5,000 |
| Telephone and communications | 15,000 |
| Consumable Store | 15,000 |
| Repair and Maintenance | 57,000 |
| Transport charges | 20,000 |
| Advertisement and Publicity, sales and marketing expenses | 2,00,000 |
| Insurance | 19,000 |
| Miscellaneous Expenses | 20,000 |
| Total | 3,51,000 |
(v) Working Capital |
(In Rs.) |
| Raw material | 1,36,75,000 |
| Salary and Wages | 5,72,000 |
| Utilities | 2,55,000 |
| Other Contingent Expenses | 3,51,000 |
| Total | 1,48,53,000 |
| Working Capital (for 3 months) | Rs. 4,45,59,000 |
C. Total Capital Investment
| Fixed Capital | Rs. 2,94,70,000 |
| Working Capital | Rs. 4,45,59,000 |
| Total | Rs. 7,40,29,000 |
Financial Analysis
(1) Cost of Production (per year) |
(Rs.) |
| Total Recurring Cost | 17,82,36,000 |
| Depreciation on Machinery and Equipment @ 10% | 11,32,000 |
| Depreciation on furnace, testing equipment and office equipment @ 20% | 3,30,000 |
| Depreciation on Dies @ 25% | 75,000 |
| Interest on total capital investment @ 12% | 88,83,000 |
| Total | 18,91,16,000 |
Turnover (per year)
Items |
Qty. |
Rate (In Rs.) |
Rate (In Rs.) |
| Galvanised M.S. Wire | 3480 ton | 57.62/ ton | 57.62/ ton |
| Scrap Wire | 120 ton | 20000 / ton | 24,00,000 |
| Total | 20,29,40,000 | ||
Net Profit (per year)
Rs. 20,29,40,000 - Rs. 18,91,16,000 = 1,38,24,000 |
Net Profit Ratio
Net Profit per year ×100 Turnover per year 1,38,24,000 ×100 20,29,40,000 6.8% |
Rate of Return
Net Profit per year ×100 Total Investment 1,38,24,000 ×100 7,40,29,000 18.7% |
Break-even Point |
(Rs.) |
| Total Depreciation | 19,97,000 |
| Interest on total Capital Investment | 88,83,000 |
| 40% of Salary and Wages | 27,45,000 |
| 40% of other contingent expenses | 16,85,000 |
| Total | 1,53,10,000 |
B.E.P.
Fixed Cost ×100 Fixed Cost ×100 1,53,10,000 ×100 1,53,10,000 + 1,38,24,000 52.55% |
Addresses of Machinery and Equipment Suppliers
- M/s. Associated Machinery Mfg. Pvt. Ltd.
Bulandshahar Road, Industrial
Area, Ghaziabad. - M/s. C.S. Wire Pvt. Ltd.
90-B, IDA., Jeedi Matha,
Hyderabad. - M/s. Wire Machinery Mfg. Corporation
7 A, Ventinard Road,
Kolkata. - M/s. Refrigeration and Machinery Corporation
Rajendra Prasad Road,
Mumbai - 400080. - M/s. Design Engineering Co.
Wadala,
Mumbai - 400431. - M/s. Wesman Engineering Co. Pvt. Ltd.
346, Pantheen Road,
Chennai. - M/s. Batliboi and Co.
R.P. Road,
Secunderabad. - M/s. United Agro Engineering Co.
R.P. Road,
Secunderabad.
Raw Material Suppliers
- M/s. Steel Authority of India Ltd.
- M/s. Tata Iron and Steel Co. Ltd.
- M/s. Hindustan Zinc Ltd.
For further information please contact
Information Manager
TIMEIS Project
E-mail: timeis@ficci.com
