PHENYL MAKING
INTRODUCTION: The unit propose to manufacture “Phenyl” which is a fluid disinfectant that destroys pathogenic organism. THE PRODUCT: Phenyl is a strong deodorant and germicide for disinfecting areas covering places like hospital, nursing homes, drains, lavatory, toilets, cowsheds and is extensively used for sanitation purpose. It is notified as a “Drug” under the Drug Drug Act and as such, prior permission and License License from Drug Control Authority is necessary for its production. MARKET POTENTIAL: The demand for phenyl is rapidly increasing due to the propagation and awareness regarding importance of hygiene. The market segment of this product can be classified as follows: (A. Rural & Urban Household (B. (B. Govt. health Sector (C. (C. Private health Sector (D. (D. Others.
All the above sectors are rapidly increasing increasing in terms of numbers of units in today’s time. But there there are hardly sufficient number of units manufacturing phenyl covering the demand. Hence, there is a scope of about 10 – 12 units to be set up in north-eastern region. SUGGESTED CAPACITY: A production of 180 Kilolitre Kilolitre per annum is suggested on the following following basis – No.of shift per day : 1 shift No.of working hours per shift : 8 hours Daily production : 600 litres. Operating days/year : 300 days Annual production : 180 Kilolitre. INFRASTRUCTURE: The main infrastructure requirements are – A. Covered area B. Utilities Power Water
:
500 sq.ft.
: :
1.5 KW 300 ltrs/day.
RAW MATERIALS: The major raw materials required are cresylic creosote and cresol which are phenol bearing liquids. A typical raw materials composition is furnished below: [Weight (%)] Cresylic cresole (27% phenol) 68.0 Cresol (99% phenol) 7.0 W.W. Rosin 9.0 Soyabean oil 4.0 Caustic soda 2.5 Water 4.5 Castor oil 5.0 100%
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Since none of the raw materials are manufactured in the region, but most of them are available in the local market in Guwahati. SUGGESTED LOCATION: Suggested locations are – Assam
:
Meghalaya Manipur Arunachal Pradesh Tripura Sikkim
: : : : :
Guwahati, Nagaon, Jorhat, Tezpur, Dibrugarh Bongaigaon. Shillong, Tura, Jowai. Imphal Itanagar, Naharlagun. Agartala. Gangtok, Pakyong, Mangan, Penlang, Lachung
PRODUCTION PROCESS: The process of manufacturing phenyl are as follows in step-wise – (A. Specification of fatty oils & rosin (B. Preparation of soft soap by adding boiling solution of caustic soda to the mixture
of fatty oils & rosin. (C. Dissolving soft soap in hot water and adding cresol & cresol. (D. Filling in bottles.
FIXED CAPITAL Land and Building Plant & Machinery Misc. Fixed Assets Preliminary & Pre-operative expenses Total CAPITAL COST OF PROJECT: A. Fixed capital B. Working Capital
(Rs lakh) On rent 0.90 0.30 0.25 1.75
1.75 5.57 7.32
Total WORKING CAPITAL REQUIREMENT:
Total
(Rs. Lakh) 1.50 1.60 2.47 5.57
COST OF PRODUCTION & PROFITABILITY: 1. Raw materials & consumables 2. Utilities & overheads 3. Wages bill 4. Other overheads 5. Depreciation 6. Selling expenses (@ 15% of annual sales) 7. Interest on Term Loan 8. Interest on Working Capital Loan Total
(Rs Lakh) 35.91 0.46 1.89 0.60 0.12 7.56 0.16 0.63 47.33
1. 2. 3.
Raw materials & consumables ½ month Finished goods ½ month Receivable ½ month
PROFITABILITY: Based on the sales realization and the cost of production, the profit at target production would be Rs 3.07 lakh per year. This works out to be a return on sales at 6.09% and the return on investment at 41.93%.
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SALES REALIZATION (Turnover): Item Qty./Annum Price/Litre (Rs) Phenyl 1,80,000ltrs/ 28/180 Kilolitre
Total Realization (Rs Lakh) Rs 50.40
NOTE: The north east market for phenyl is shared by a few local products and producers located at Kolkata like Kolkata Chemical & others. The detail price per litre ranges from Rs 35/- to Rs 40/- . At ex-factory price of Rs 28/- per litre, the annual sales turn over 180 Kilolitres of Phenyl is estimated at Rs 50.40 Lakh. SOURCE OF FINANCE: A. On Fixed Capital: Term Loan Promoter’s contribution
: :
Rs 0.44 lakh Rs 1.31 lakh Rs 1.75 lakh
: : :
Rs 4.17 lakh Rs 1.70 lakh Rs 5.57 lakh
Total B.
On Working Capital Bank Finance Promoter’s Contribution Total
C.
Total (Term Loan + Working Capital Loan) i) Loan amount(75%) ii) Promoter’s contribution(25%) Total
Rs 5.48 lakh Rs 1.84 lakh Rs 7.32 lakh
Note: The source of finance has been calculated at 75% as Bank Finance and 25% as promoter’s equity. MACHINERY: The equipment required are – (A. Karahi – 500 Litre capacity. (B. Bottle washing machine 0.5 HP fitted on M.S. tank. (C. Pilfer proof cap. Sealing machine. (D. Weighing scale platform type of 300 Kg. capacity.
COST OF RAW MATERIALS & CONSUMABLES: Sl.No.
Materials
1. 2.
Cresylic cresole Cresol (99% Phenol) W.W. Rosin Castor Oil (Second presence) Soyabean Oil Caustic soda Packing Materials (Bottles, labels etc.)
3. 4. 5. 6. 7.
Qty. tonne/KL 100.80 12.20
Price Tonne/KL 18,000 44,000
Amount (Rs Lakh) 18.14 5.37
15.40 9.00
29,000 15,500
4.47 1.39
6.40 4.5
36,000 16,500 L.S
2.30 0.74 3.50
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COST OF UTILITIES & OVERHEADS: 1. 2.
Power - 1.5 KW Other overheads (Water – 300 ltrs./day @ Rs 100/day
: :
Rs. 0.16 Lakh Rs 0.30 Lakh
No.
Salary per person per month (Rs) 4,000/3,000/2,500/1,500/700/-
MANPOWER REQUIREMENT & WAGES BILL: Sl.No.
Category
1. 2. 3. 4. 5.
Manager Salesman Skilled labour Semi-skilled labour Helper TOTAL
1 1 2 2 1
FINANCIAL RATIOS: 1. 2. 3.
Profit + sales ratio Profit + investment ratio Break-Even Point a) at 100% utilization b) at 70% utilization
: :
6.09% 41.93%
: :
52.55% 36.76%
MACHINERY SUPPLIERS: 1.
M/s Oriental Machinery (1919) Pvt. Ltd. 25, R.N. Mukherjee Road, Kolkata – 700 001.
2.
M/s Gee Gee Co (P) Ltd., B – 188/2, Savitri Nagar (Malaviya Nagar), New Delhi – 17
3.
M/s Archana Machinery A.T. Road, Guwahati (Assam)
4.
M/s Kamrup Machinery, A.T. Road, Guwahai (Assam).
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Amount (Rs Lakh) 0.48 0.36 0.60 0.36 0.09 1.89
