PROJECT REPORT

Of

UPVC PIPES

PURPOSE OF THE DOCUMENT

This particular pre-feasibility is regarding UPVC Pipes.

The objective of the pre-feasibility report is primarily to facilitate potential entrepreneurs in project
identification for investment and in order to serve his objective; the document covers various aspects
of the project concept development, start-up, marketing, finance and management.

[We can modify the project capacity and project cost as per your requirement. We can also prepare
project report on any subject as per your requirement.]

Lucknow Office: Sidhivinayak Building ,

27/1/B, Gokhlley Marg, Lucknow-226001

Delhi Office : Multi Disciplinary Training

Centre, Gandhi Darshan Rajghat,
New Delhi 110002

Email : info@udyami.org.in
Contact : +91 7526000333, 444, 555
 PROJECT AT A GLANCE

1 Name of the Entreprenuer xxxxxxxxxx

2 Constitution (legal Status) xxxxxxxxxx

3 Father / Spouse Name xxxxxxxxxxxx

4 Unit Address : xxxxxxxxxxxxxxxxxxxxxxx

District : xxxxxxx
Pin: xxxxxxx State: xxxxxxxxxx
Mobile xxxxxxx

5 Product and By Product : UPVC PIPES

6 Name of the project / business activity proposed : UPVC PIPES MANUFACTURING UNIT

7 Cost of Project : Rs.24.39 Lakhs

8 Means of Finance
Term Loan Rs.18.45 Lakhs
Own Capital Rs.2.44 Lakhs
Working capital Rs.3.5 Lakhs

9 Debt Service Coverage Ratio : 2.56

10 Pay Back Period : 5 Years

11 Project Implementation Period : 5-6 Months

12 Break Even Point : 34%

13 Employment : 8 Persons

14 Power Requirement : 30.00 HP

15 Major Raw materials : PVC Resins , Stabilizers, Other additives

16 Estimated Annual Sales Turnover (Max Capacity) : 107.00 Lakhs

17 Detailed Cost of Project & Means of Finance

COST OF PROJECT (Rs. In Lakhs)

Particulars Amount
Land Own/Rented
Building /Shed 1000 Sq ft 5.00
Plant & Machinery 14.00
Furniture & Fixtures 1.50
Working Capital 3.89
Total 24.39

MEANS OF FINANCE
Particulars Amount
Own Contribution 2.44

Working Capital(Finance) 3.50

Term Loan 18.45

Total 24.39
 UPVC PIPE

Introduction: Unplasticized polyvinyl chloride (uPVC), also known as rigid

PVC, Pipes & Fittings are used for all plumbing purposes in residential &
commercial buildings. Ideally suited for looping at each floor level, outdoor
installations & concealed pipelines for cold water distribution. uPVC is known
as having strong resistance against chemicals, sunlight & oxidation from
water. uPVC is widely used in construction because it is durable, cheap and
easily worked. The material comes in a range of colors and finishes, including
a photo-effect wood finish, and is used as a substitute for painted wood,
mostly for window frames and sills when installing double glazing in new
buildings, or to replace older single-glazed windows. Other uses include fascia,
and siding or weather boarding. This material has almost entirely replaced the
use of cast iron for plumbing and drainage, being used for waste pipes, drain
pipes, gutters and down spouts. uPVC does not contain phthalates, since those
are only added to flexible PVC, nor does it contain BPA.
Difference between uPVC and PVC: PVC is poly(vinyl chloride)
polymer usually containing plasticizer plus some other additive (fillers,
lubricants, stabilizers, …), whereas, UPVC is unplasticized poly(vinyl chloride),
without any added plasticizing agent or with a small amount, but including
other additives.

UPVC is harder than PVC due to absence of plasticizer. It is used to produce

hard products, like windows frames and pipes. That is their main difference,
but their similarity is that both are poly (vinyl chloride), same base polymer.

Applications:
 Water Supply: uPVC pipes are the best for water supply scheme, such
as water supply distribution network, main line, casing for tube work
and raising main for handpump.
 Chemical Industries: uPVC is very good for transporting of chloride
acid and other chemicals.
 Sewer Systems: uPVC pipe of larger diameter can be used for sewer
system.
 Cable Conduits: uPVC pipe is most suitable as electrical conduits.
 Agriculture: uPVC pipe is very suitable for agriculture purposes such as
for irrigation sprinkling pipe for farm land & other purposes.
 Crude oil lines: uPVC pipe resist corruption, the deposit build up
process is also difficult which result the low friction rate and thus
making uPVC pipe the most suitable for the crude oil line.

Machines & equipments: Basic machines & equipments are:

Name Unit Price
Extruder 1 950000
Mixer 1 70000
Cut of machine 1 42350
Inject printing machine 1 40000
Hopper & feeder 1 132000
Cooling tank 1 120000
Other equipments 45650

Raw material requirements: Major raw material are as follows:

1. PVC Resins
2. Stabilizers
3. Other Additives

Manufacturing Process: The various raw materials are procured from

vendors and stored in raw material inventory as per production requirement,
form where they are brought to manufacturing unit, where they are fed to
mixer in appropriate quantity as per type of UPVC Pipe which is to be made.

The raw material blend is fed to the extruder via a hopper and feeder
arrangement which simply melts the raw material blend which is mostly PVC
resin into a semi solid state which is then extruded into a continuous pipe by
forcing it against the die and mandrel arrangement.

If a thin walled tube is to be produced then this continuous tube is fed to a

tube drawing machine which further reduces it’s wall thickness followed by
which its moved via cooling tank where water bath cools of the pipe.

A Inject Printing machine prints the required information onto the pipe at
fixed interval as per the length of the pipe. The continuous Pipe is then simply
cut in required length by a cut-off machine and are ready for sale.

Area:

The industrial setup requires space for Inventory, workshop or manufacturing

area, space for power supply utilities and auxiliary like Generator setup. Also
some of the area of building is required for office staff facilities,
documentation, office furniture, etc. Thus, the approximate total area required
for complete industrial setup is 1000 to 1200Sqft. Civil work cost will be
around 5 Lac Rs.(Approx.)

Power Requirement –The power consumption required to run all the

machinery could be approximated as 30hp.

Manpower Requirement– There are requirement of skilled machine

operators to run the machine set. Experience quality engineers are required
for desired quality control. Some helpers are also required to transfer the
material from one work station to other. Office staffs are required to maintain
the documentation. The approximate manpower required is 8 including 1
Supervisor, 1 Plant operator and 1 unskilled worker , 1 Helper, 1 Security
guard. 3 Skilled worker including Accountant, Manager and Sales person.

Bank Term Loan: Rate of Interest is assumed to be at 11%

Depreciation: Depreciation has been calculated as per the Provisions of

Income Tax Act, 1961

Approvals & Registration Requirement:

Basic registration required in this project:

 GST Registration
 Udyog Aadhar Registration (Optional)
 Choice of a Brand Name of the product and secure the name with
Trademark if require
Implementation Schedule:
S No. Activity Time required
1. Acquisition of premises 1-2 Months
2. Procurement & installation of Plant & Machinery 1-2 Months
3. Arrangement of Finance 1.5-2 Months
4. Requirement of required Manpower 1 Month
5. Commercial Trial Runs 1 Month
Total time Required (some activities shall run 5-6 Months
concurrently)

FINANCIALS
PROJECTED CASH FLOW STATEMENT

PARTICULARS I II III IV V

SOURCES OF FUND

Own Contribution 2.44 -

Reserve & Surplus 4.96 6.95 9.52 13.69 17.95
Depriciation & Exp. W/off 2.75 2.37 2.04 1.76 1.52
Increase In Cash Credit 3.50
Increase In Term Loan 18.45 - - - -
Increase in Creditors 1.89 0.25 0.15 0.15 0.15

TOTAL : 33.99 9.56 11.72 15.60 19.63

APPLICATION OF FUND

Increase in Fixed Assets 20.50 - - - -

Increase in Stock 1.57 0.21 0.19 0.20 0.21
Increase in Debtors 4.35 0.69 0.66 0.70 0.74
Repayment of Term Loan 2.05 4.10 4.10 4.10 4.10
Taxation - 1.04 1.43 2.05 2.69
Drawings 3.00 3.50 5.00 7.00 10.00
TOTAL : 31.47 9.54 11.38 14.05 17.74

Opening Cash & Bank Balance - 2.53 2.55 2.89 4.44

Add : Surplus 2.53 0.02 0.34 1.55 1.89

Closing Cash & Bank Balance 2.53 2.55 2.89 4.44 6.33
PROJECTED BALANCE SHEET

PARTICULARS I II III IV V

SOURCES OF FUND
Capital Account
Opening Balance - 4.40 6.81 9.90 14.54
Add: Additions 2.44 - - - -
Add: Net Profit 4.96 5.90 8.09 11.64 15.26
Less: Drawings 3.00 3.50 5.00 7.00 10.00
Closing Balance 4.40 6.81 9.90 14.54 19.80
CC Limit 3.50 3.50 3.50 3.50 3.50
Term Loan 16.40 12.30 8.20 4.10 -
Sundry Creditors 1.89 2.14 2.29 2.44 2.60

TOTAL : 26.19 24.75 23.89 24.58 25.89

APPLICATION OF FUND

Fixed Assets ( Gross) 20.50 20.50 20.50 20.50 20.50

Gross Dep. 2.75 5.12 7.16 8.93 10.45
Net Fixed Assets 17.75 15.38 13.34 11.57 10.05

Current Assets
Sundry Debtors 4.35 5.03 5.69 6.39 7.13
Stock in Hand 1.57 1.78 1.98 2.17 2.38
Cash and Bank 2.53 2.55 2.89 4.44 6.33

26.19 24.75 23.89 24.58 25.89

TOTAL :

- - - - -
PROJECTED PROFITABILITY STATEMENT

PARTICULARS I II III IV V

A) SALES
Gross Sale 65.20 75.51 85.41 95.90 107.00

Total (A) 65.20 75.51 85.41 95.90 107.00

B) COST OF SALES

Raw Material Consumed 37.83 42.78 45.83 48.89 51.94

Elecricity Expenses 2.97 3.20 3.42 3.65 3.88
Repair & Maintenance 5.22 7.55 10.25 12.47 14.98
Labour & Wages 4.79 5.08 5.53 6.09 6.69
Depreciation 2.75 2.37 2.04 1.76 1.52

Cost of Production 53.55 60.97 67.08 72.86 79.02

Add: Opening Stock /WIP - 0.94 1.07 1.21 1.36

Less: Closing Stock /WIP 0.94 1.07 1.21 1.36 1.52

Cost of Sales (B) 52.61 60.84 66.94 72.71 78.86

C) GROSS PROFIT (A-B) 12.58 14.67 18.46 23.19 28.13

19.30% 19.43% 21.62% 24.18% 26.29%
D) Bank Interest (Term Loan ) 2.00 1.63 1.18 0.73 0.28
ii) Interest On Working Capital 0.39 0.39 0.39 0.39 0.39
E) Salary to Staff 3.28 3.44 3.96 4.55 5.23
F) Selling & Adm Expenses Exp. 1.96 2.27 3.42 3.84 4.28

TOTAL (D+E) 7.62 7.72 8.94 9.50 10.18

H) NET PROFIT 4.96 6.95 9.52 13.69 17.95

7.6% 9.2% 11.1% 14.3% 16.8%
I) Taxation - 1.04 1.43 2.05 2.69

J) PROFIT (After Tax) 4.96 5.90 8.09 11.64 15.26

Raw Material Consumed Capacity Amount (Rs.)

Utilisation

I 65% 37.83
II 70% 42.78 5% Increase in Cost
III 75% 45.83 5% Increase in Cost
IV 80% 48.89 5% Increase in Cost
V 85% 51.94 5% Increase in Cost
COMPUTATION OF MAKING OF UPVC PIPES

Item to be Manufactured Upvc Pipes

Manufacturing Capacity per day 400 kg

No. of Working Hour 8

No of Working Days per month 25

No. of Working Day per annum 300

Total Production per Annum 1,20,000 kg

Total Production per Annum 1,20,000 kg

Year Capacity UPVC PIPES

Utilisation

I 65% 78,000.00
II 70% 84,000.00
III 75% 90,000.00
IV 80% 96,000.00
V 85% 1,02,000.00

COMPUTATION OF RAW MATERIAL

Quantity of Raw Total CostPer Annum
Unit Unit Rate of
Item Name Material (100%)
PVC Resins 90,000.00 kg 50.00 45,00,000.00
Stabilizers 20,000.00 kg 60.00 12,00,000.00
Other Additives 1,20,000.00
-
-
Total 58,20,000.00

Total Raw material in Rs lacs 58.20

COMPUTATION OF CLOSING STOCK & WORKING CAPITAL

PARTICULARS I II III IV V

Finished Goods
(5 Days requirement) 0.94 1.07 1.21 1.36 1.52
Raw Material
(5 Days requirement) 0.63 0.71 0.76 0.81 0.87

Closing Stock 1.57 1.78 1.98 2.17 2.38

COMPUTATION OF WORKING CAPITAL REQUIREMENT

Particulars Amount Margin(10%) Net

Amount
Stock in Hand 1.57
Less:
Sundry Creditors 1.89
Paid Stock - 0.32 - 0.03 - 0.29

Sundry Debtors 4.35 0.43 3.91

Working Capital Requirement 3.62

Margin 0.40

MPBF 3.62
Working Capital Demand 3.50
COMPUTATION OF SALE
Particulars I II III IV V

Op Stock - 1,300.00 1,400.00 1,500.00 1,600.00

Production 78,000.00 84,000.00 90,000.00 96,000.00 1,02,000.00

78,000.00 85,300.00 91,400.00 97,500.00 1,03,600.00

Less : Closing Stock(5 Days) 1,300.00 1,400.00 1,500.00 1,600.00 1,700.00

Net Sale 76,700.00 83,900.00 89,900.00 95,900.00 1,01,900.00

Sale Price per kg 85.00 90.00 95.00 100.00 105.00

Sale (in Lacs) 65.20 75.51 85.41 95.90 107.00

BREAK UP OF LABOUR

Particulars Wages No of Total

Per Month Employees Salary
Supervisor 12,000.00 1 12,000.00
Plant Operator 10,000.00 1 10,000.00
Unskilled Worker 6,000.00 1 6,000.00
Helper 4,000.00 1 4,000.00
Security Guard 6,000.00 1 6,000.00

38,000.00
Add: 5% Fringe Benefit 1,900.00
Total Labour Cost Per Month 39,900.00
Total Labour Cost for the year ( In Rs. Lakhs) 5 4.79

BREAK UP OF SALARY

Particulars Salary No of Total

Per Month Employees Salary
Manager 10,000.00 1 12,000.00
Accountant cum store keeper 8,000.00 1 8,000.00
Sales 6,000.00 1 6,000.00
Total Salary Per Month 26,000.00

Add: 5% Fringe Benefit 1,300.00

Total Salary for the month 27,300.00

Total Salary for the year ( In Rs. Lakhs) 3 3.28

COMPUTATION OF DEPRECIATION

Plant &
Description Land Building/shed Machinery Furniture TOTAL

Rate of Depreciation 10.00% 15.00% 10.00%

Opening Balance Leased - - -
Addition - 5.00 14.00 1.50 20.50
- 5.00 14.00 1.50 20.50
- - -
TOTAL 5.00 14.00 1.50 20.50
Less : Depreciation - 0.50 2.10 0.15 2.75
WDV at end of Ist year - 4.50 11.90 1.35 17.75
Additions During The Year - - - - -
- 4.50 11.90 1.35 17.75
Less : Depreciation - 0.45 1.79 0.14 2.37

WDV at end of IInd Year - 4.05 10.12 1.22 15.38

Additions During The Year - - - - -
- 4.05 10.12 1.22 15.38
Less : Depreciation - 0.41 1.52 0.12 2.04
WDV at end of IIIrd year - 3.65 8.60 1.09 13.34
Additions During The Year - - - - -
- 3.65 8.60 1.09 13.34
Less : Depreciation - 0.36 1.29 0.11 1.76
WDV at end of IV year - 3.28 7.31 0.98 11.57
Additions During The Year - - - - -
- 3.28 7.31 0.98 11.57
Less : Depreciation - 0.33 1.10 0.10 1.52
WDV at end of Vth year - 2.95 6.21 0.89 10.05
 REPAYMENT SCHEDULE OF TERM LOAN 11.0%

Year Particulars Amount Addition Total Interest Repayment Cl Balance

I Opening Balance
Ist Quarter 18.45 - 18.45 0.51 - 18.45
Iind Quarter 18.45 - 18.45 0.51 - 18.45
IIIrd Quarter 18.45 - 18.45 0.51 1.03 17.43
Ivth Quarter 17.43 - 17.43 0.48 1.03 16.40
2.00 2.05
II Opening Balance
Ist Quarter 16.40 - 16.40 0.45 1.03 15.38
Iind Quarter 15.38 - 15.38 0.42 1.03 14.35
IIIrd Quarter 14.35 - 14.35 0.39 1.03 13.33
Ivth Quarter 13.33 13.33 0.37 1.03 12.30
1.63 4.10
III Opening Balance
Ist Quarter 12.30 - 12.30 0.34 1.03 11.28

Iind Quarter 11.28 - 11.28 0.31 1.03 10.25

IIIrd Quarter 10.25 - 10.25 0.28 1.03 9.23
Ivth Quarter 9.23 9.23 0.25 1.03 8.20
1.18 4.10
IV Opening Balance
Ist Quarter 8.20 - 8.20 0.23 1.03 7.18
Iind Quarter 7.18 - 7.18 0.20 1.03 6.15
IIIrd Quarter 6.15 - 6.15 0.17 1.03 5.13
Ivth Quarter 5.13 5.13 0.14 1.03 4.10
0.73 4.10
V Opening Balance
Ist Quarter 4.10 - 4.10 0.11 1.03 3.08
Iind Quarter 3.08 - 3.08 0.08 1.03 2.05
IIIrd Quarter 2.05 - 2.05 0.06 1.03 1.03

Ivth Quarter 1.03 1.03 0.03 1.03 - 0.00

0.28 4.10

Door to Door Period 60 Months

Moratorium Period 6 Months
Repayment Period 54 Months
CALCULATION OF D.S.C.R

PARTICULARS I II III IV V

CASH ACCRUALS 7.71 8.27 10.14 13.40 16.78

Interest on Term Loan 2.00 1.63 1.18 0.73 0.28

Total 9.72 9.91 11.32 14.13 17.06

REPAYMENT
Repayment of Term Loan 2.05 4.10 4.10 4.10 4.10
Interest on Term Loan 2.00 1.63 1.18 0.73 0.28

Total 4.05 5.73 5.28 4.83 4.38

DEBT SERVICE COVERAGE RATIO 2.40 1.73 2.14 2.92 3.89

AVERAGE D.S.C.R. 2.56

COMPUTATION OF ELECTRICITY
(A) POWER CONNECTION

Total Working Hour per day Hours 8

Electric Load Required HP 30
Load Factor 0.7460
Electricity Charges per unit 7.50
Total Working Days 300
Electricity Charges 4,02,840.00

Add : Minimim Charges (@ 10%)

(B) DG set
No. of Working Days 300 days
No of Working Hours 0.3 Hour per day
Total no of Hour 90
Diesel Consumption per Hour 8
Total Consumption of Diesel 720
Cost of Diesel 65.00 Rs. /Ltr
Total cost of Diesel 0.47
Add : Lube Cost @15% 0.07

Total 0.54

Total cost of Power & Fuel at 100% 4.57

Year Capacity Amount

(in Lacs)

I 65% 2.97
II 70% 3.20
III 75% 3.42
IV 80% 3.65
V 85% 3.88
 DISCLAIMER

The views expressed in this Project Report are advisory in nature. SAMADHAN
assume no financial liability to anyone using the content for any purpose. All the
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reflect the views of the industry which are drawn from various research material
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considering specific requirement of the project, capacity and type of plant and
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intended for general guidance only and must not be considered a substitute for a
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hereby disclaims any and all liability to any party for any direct, indirect, implied,
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