DETAILED
PROJECT REPORT
Non-Woven Bags Manufacturing
For
XYZ
Office and Factory
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Non-Woven Fabric Bags:
Non-woven fabric bags are a perfect alternative for plastic. Like plastic bags they can
be made into all desired shapes and sizes and they have the advantage of
biodegradable nature over plastic.
Growing awareness about dangers to the environment by using plastic, traders and
consumers are showing interest in non-woven bags. Efforts are being taken to
control and reduce their use in India recently, which makes Non-woven bags a
lucrative and future potential product.
Owing to its unique characteristics, ease of processing and design flexibility, there is
an infinite scope of innovation. Thus, scope of business opportunities for
entrepreneurs is great.
Advantages of Non-Woven Fabric Bags:
Easy to carry & Washable Attractive colours and Printing
Strong and durable Non-polluting product
Biodegradable and eco-friendly Recyclable
Shock Resistance Antibacterial properties
Non-Woven bags are of great advantage to the environment, given their
degradability, durability and eco-friendly nature. These bags are strong and can hold
much higher weight than the same size polythene bag.
They are good for retail, Apparels, promotional, grocery, health & beauty, Gadgets,
and so much more.
Customized Size, Thickness and Printing
Finding demand for Non-Woven fabric bags is increasing at a faster rate and there
exists a gap in demand and supply curve, we found tremendous potential on
concentrating on the proposed activity
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Market Potential:
Non-Woven Fabric Bags are widely used as packing materials due to so many
advantages over conventional sacks. In turn due to rapid growth in processing and
chemical industries the demand of these materials are touching sky high. The
present manufacturers are not able to meet the anticipated demand. Hence it is
expected that the unit would be able to get sufficient orders for achieving the
capacity.
Different Market Segments for Non-Woven Bags
1. Retail
1.1 Apparels
1.2 Sweet Shops
1.3 Beverage shops
1.4 Jewellery shops
2. Super Markets
2.1 Shopping Malls
2.2 Family Shopping showrooms
2.3 General Super markets
3. Health
3.1 Medical Stores
4. Hospitality
4.1 Hotels
4.2 Food Outlets
4.3 Restaurants – Home Delivery
5. Corporate
5.1 Conferences
5.2 Sales & Marketing Expo’s
Apart from above mentioned segments education institutes and coaching centres
and many other outlets are also potential buyers of the product.
The awareness about the pollution by using plastic is day by day increasing which is
leading to look for an alternative.
Today Non-Woven bags are the only viable and alternative for polythene bags
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Manufacturing Process:
The machine planned to purchase is robust equipment which can handle end to end
process of Bag making with minimal manual intervention
Raw Material: Raw Material is Non-Woven fabric rolls and is available from
various companies in Hyderabad
Some of the players who are manufacturing and distributing Non-Woven Fabric Rolls
o Savitridevi Poly Fabrics India Pvt Ltd – Bollaram, Hyderabad
o Jaidev Fabrics Private Ltd – Begumpet, Hyderabad
o Primotex Industries Pvt Ltd – Cherlapalli, Hyderabad
Printing
The Non-Woven Rolls can be loaded
to the printing machine directly where
printing is needed
The printing machine can print 6
different colours
The printed rolls are then loaded to fully automatic bag making machine to begin the
process.
Fully Automated Non-Woven Bag making machine can make Different kinds of bags
at a speed of approx. 70pcs/min. It is designated to produce Non-Woven box type,
vest bag, D-cut type bag, rope through type bags, zipper bags etc., in different
specifications and shapes. It combines the mechanical and electrical together as a
whole, use ultrasonic sealing and operation by touch screen.
The unit will be working for 10 hours every day for approximately 300 working days
in a year. It has been assumed in the project report that the unit will operate at 60%
of the installed capacity during the first operating year which will subsequently
increase to 80% in the 3rd year so on so forth.
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Non Woven Fabric Rolls Prinitng on Non-Woven Fabric
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Promoters:
ADQ GLOBAL is a partnership concern. The promoters will be overall in charge of
the unit. The Promoters are assisted by trained technicians/managerial persons in
carrying out the day to day activities of the concern. The Promoter is keen in starting
their independent business since past many years and has therefore studied and
surveyed many options and avenues with the objective in their minds
1. XXXXXXXXXXXXXXXXXXXXX
2. XXXXXXXXXXXXXXXXXX
Promoters Background:
Both partners are currently not working and have working experience in various roles
for MNC’s.
Having seen the current demand for Non-Woven bags started working on the market
for the product and started reselling the bags for various businesses.
Depending upon the efficiency of the promoters and their marketing ability the unit
will be able to operate at higher production level than what has been envisaged in
the report.
Key clients:
1. Agra Sweets 2.
3. Triveni Super Market (Warangal) 4. Multiple Wine Shops
3. Location of the Project:
ADQ GLOBAL is in process of setting up a small-scale unit for manufacturing of
NON WOVEN FABRIC BAGS. The unit is proposed to be located at ALEAP
Gajularamaram on leased land and shed measuring 2500-3000 sq ft. Where all the
basic infrastructural facilities like water distribution network with overhead tank, main
and internal roads, power distribution network with all electrical peripherals etc., are
available. The proposed project as such would not face any difficulty for its smooth
operation.
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Project Cost Summary:
Machinery Cost 38,00,000.00
Working Capital for 1 year 12,00,000.00
Total Project Cost 50,00,000.00
Particulars Cost
Land Building Leased
Plant & Machinery 37,00,000.00
Miscellaneous Fixed Assets 1,00,000.00
Working Capital 12,00,000.00
Total 50,00,000.00
MEANS OF FINANCE (in Rs)
Capital contribution from Promoters 12,50,000.00
Loan from Bank (Term Loan) 37,50,000.00
Loan on Machinery 28,50,000.00
Loan for Working Capital 9,00,000.00
Estimated Cost on Plant & Machinery:
While arriving at the requirement of various types of equipment and machinery
required for the plant, due consideration has been given to the following points.
Minimum wastage
High Productivity
Flexibility in operation
Adequate stand by provision where ever necessary
The production plant and equipment proposed have been selected for the envisaged
production capacity and incorporates features that permit smooth operation of the
plant. After making a preliminary study of the source of supply, such equipment it
has been identified most of the equipment are to be imported.
The concern is expected to purchase the requisite machinery from reputed
authorized dealer, who would also assist in the installation of plant and machinery.
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Details of Plant & Machinery
Particulars Qty Cost
SSA - Fully Automated
Non-Woven Multi Bag making machine 1 16,00,000.00
SSA-Die Punching Machine 1 1,25,000.00
SSA-Non-Woven auto handle loop machine 1 4,50,000.00
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SSA-6 Colour Roll to Roll printing machine 1 9,00,000.00
SSA - Ultrasonic Sewing Machine 1 1,00,000.00
35 KVA Stabilizer 1 85,000.00
5 HP Air Compressor 1 1,00,000.00
Power Generator 1 2,60,000.00
VAT @ 5% 1,83,000.00
Total 38,43,000.00
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Statement of Calculation of Raw Material:
Material Units
Non-Woven Fabric Rolls (in Metric Tons) 150
Rate/ Kg (in Rupees) 110.00
Cost per Metric Tone 1,10,000.00
Total Cost of the material per annum (in Rupees) 165,00,000.00
Estimation of Installed Capacity:
Working Hrs. per day 10 Hours
Working Days per annum 300 days
Wastage 2%
Production per Annum (in M Tons) 147.00
Average Rate per kg in the market 150.00
Total Revenue per Annum 220,50,000.00
Manpower & Remuneration
No of
Particulars Salary Monthly Total (p.a.)
personnel
Production Supervisor / 1 15,000.00 15,000.00 1,80,000.00
Operator
Sales/Marketing 1 10,000.00 10,000.00 1,20,000.00
Semi-Skilled 2 6,000.00 12,000.00 1,44,000.00
Un-Skilled 4 5,000.00 20,000.00 2,40,000.00
Total 9 57,000.00 6,84,000.00
Estimated Cost of Utilities per Annum:
Power by Generator cost 50,000.00
Power Cost 1,99,075.00
Other Miscellaneous Expenses 50,000.00
Total Utilities 2,99,075.00
Interest on Long Term Loan:
Long Term Borrowings 37,50,000.00
Rate of Interest 14%
Loan Repayment per annum 8,43,300.00
Repayment term 7 Years
EMI per Month 70,275.00
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Projected Profitability Statement
The annual cost of Sales & Profitability during the 1st 5 years of the operation of the
plant is estimated in the following table:
S No Particulars Operating Years
1 Year of operation 1st 2nd 3rd 4th 5th
2 Capacity Utilisation (%) 60% 70% 80% 90% 100%
3 Sales Realisation 132.30 154.35 176.40 198.45 220.50
A: Cost of Production:
1 Raw Material 99.00 115.50 132.00 148.50 165.00
2 Salaries & Wages 6.84 7.52 8.28 9.10 10.01
3 Utilities 3.00 5.00 6.00 7.00 8.00
4 Repairs & Maintenance 0.15 0.35 0.45 0.60 0.75
5 Administrative Expenses 0.60 2.00 3.00 5.00 6.00
6 Selling Expenses 0.75 2.00 2.50 3.50 5.00
7 Total: 110.34 132.37 152.23 173.70 194.76
8 Gross Profit 21.96 21.98 24.17 24.75 25.74
B. Financial Expenses
1 Interest on Term Loan& W.C 5.04 4.53 3.95 3.28 2.51
2 Depreciation (W.D.V) 3.80 3.42 3.08 2.77 2.49
3 Total 8.84 7.95 7.03 6.05 5.00
4 Profit before Tax 13.12 14.03 17.15 18.70 20.73
5 Income Tax 3.94 4.21 5.14 5.61 6.22
6 Profit After Tax 9.19 9.82 12.00 13.09 14.51
7 Withdrawals 0.00 0.00 2.00 3.00 5.00
8 Profit carried to BS 9.19 9.82 10.00 10.09 9.51
9 Cumulative Profit 9.19 19.00 29.01 39.10 48.61
10 Add back depreciation 3.80 3.42 3.08 2.77 2.49
11 Total Cash Surplus 12.99 22.42 32.09 41.87 51.10
C. Less: Payment
1 Term Loan 3.40 3.90 4.49 5.16 5.92
2 Withdrawals 0.00 0.00 1.00 2.00 3.00
3 Total Payments 3.40 3.90 5.49 7.16 8.92
4 Net Cash accruals 9.59 18.52 26.60 34.71 42.18
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Debt Service Coverage Ratio
The debt service coverage ratio shows the ability of the Unit to repay interest and
principal amount of composite loans:
S.No. Particulars 1st 2nd 3rd 4th 5th
A. Source of Funds:
1. Profit after Tax 9.19 9.82 12.00 13.09 14.51
2. Depreciation 3.80 3.42 3.08 2.77 2.49
3. Interest on Term Loan & W.C 5.04 4.53 3.95 3.28 2.51
TOTAL ‘A’ 18.02 17.77 19.03 19.14 19.52
B. Disposition of Funds:
4. Repayment of Term Loan 3.40 3.90 4.49 5.16 5.92
TOTAL B (3 + 4) 8.43 8.43 8.43 8.43 8.43
C. Debt Service Coverage Ratio 2.14 2.11 2.26 2.27 2.31
D.. Average DSCR 2.22
Projected Balance Sheet
The Balance Sheet is a very important feature of financial health of the unit. In a
healthy unit, there is always a growth in total assets and liabilities every year. In a
projected balance sheet, the reserves and surplus on liabilities side and cash bank
balances on assets side should show healthy growth.
S.No. Particulars 1st 2nd 3rd 4th 5th
A. L I A B I L I T I E S:
1. Partners’ Capital 12.50 12.50 12.50 12.50 12.50
2. Reserves & Surplus 9.64 13.10 15.49 17.79 20.08
3. Term Loan 23.67 20.91 17.76 14.16 10.06
4. Working Capital Loan 12.15 12.15 12.15 12.15 12.15
4. Sundry Creditors & Provisions
Total: 93.41 99.31 104.35 108.85 113.54
B. A S S E T S:
1. Gross Block 32.00 27.20 23.12 19.65 16.70
2. Depreciation 4.80 4.08 3.47 2.95 2.51
3. Net Block 27.20 23.12 19.65 16.70 14.19
4. Current Assets
5. Cash & Bank Balances
Total: 93.41 99.31 104.35 108.85 113.54
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CONCLUSION:
On critical examination and analysis of various indicators, it may be stated that the
proposed unit is a bankable proposition, deserving the support and favourable
consideration of Institution/Bank(s).
We continue to strive for environmentally conscious
products
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