PILFER PROOF CAPS

A. INTRODUCTION

Pilfer Proof caps are being used in Pharmaceuticals, Chemicals, Food industries

and Distilleries as Glass bottle closures. The main consumption is from

distilleries. The consumption is increasing with the increase in standard of

living of the people.

B. PRODUCT USES AND SPECIFICATIONS

Pilfer Proof caps are meant to provide to the contents in a container protection

against substitution, adulteration or pilfering. Once the PP cap is fixed on the

package it is ordinarily not possible to tamper with the contents of the package

without destroying the special device in the closure which is intended to

provide such protection. The roll seal aluminium closure is most extensively

used cap fitted on the glass bottles containing the products such as liquor,

pharmaceuticals, chemicals, syrups and squashes.

Bureau of Indian Standards have not prescribed any standards .The PP caps

manufactured should conform to the requirement of the customer with

reference to the sizes, designs, standards/specifications

C. MARKET POTENTIAL

The market demand for PP caps is increasing with the overall development of

the industries and general standard of living of the people. PP caps are used as

a cover for mainly glass containers. The glass bottles are used in milk

packaging, pharmaceuticals, breweries, oils and cosmetics and soft drinks

industry. The main use pattern of glass bottles in various areas is as follows

Milk schemes 15%

Pharmaceuticals 25%

Breweries 30%

Oils & cosmetics, Food 16%

Soft drinks industry 14%

The consumption of PP caps is increasing as the consumption of theses usage

sector is increasing year after year.

D. TECHNICAL ASPECTS

1. Installed Capacity

The proposed machine would work for single shift a day for 300 days. The total

installed capacity of the unit is 100 000 PP caps per day. On this basis the

installed capacity will be 300 lakhs PP caps per annum.

2. Plant and Machinery

The following machineries are required for production.

Machine name Quantity Value
(Nos) (Rs. lakhs)

32 Tonne capacity un-geared fixed stroke, fixed 1 4.50

inclined, power press, fitted with pneumatic friction
clutch and brake, one shot lubrication device and
suitable electrical

Multi spindle knurling, beading machine complete 1 3.00

with electricals and cap feeder device

Three cavity die set suitable for 28 mm PP caps die 1 1.05

comprising diagonal pillar set with feeder plate and
other standard accessories
Roll feed attachment for automatic strip feeding up to 1 0.40
0.3mm thickness and width 175 mm with standard
accessories

Rotary wads assembling machine complete with 1 3.50

suitable electricals and digital counter. Machine
synchronized with knurling machine

Shearing machine pedal operated with strip collection 1 0.40

tray

Ring separator sorting drum for scrap rings with 1 0.40

electricals
Inspection conveyor 1 0.55
Big step conveyor and silo 1 0.80
Small step conveyor 1 0.70
Cap sealing machine pedal operated for testing caps 1 0.40
Electrical control Panel with sensor 1 1.60
1 HP blower with electricals & pipe synchronization 1 0.20
Testing Instruments &Misc. Tools 0.30
Total 18.00
3. Manufacturing Process

The manufacturing involves the following process

Printing the desired design on aluminium sheets

I
Blanking and drawing cap on the punching machine by fitting the multiple die
for a particular size
I
Finishing the cap by giving final shape which gives knurling, grooving
perforation of the beading
I
Fitting circular washers in the cap manually wherever required
I
Packing and Despatching

4. Raw Material

The raw materials required for manufacturing aluminium PP caps is 33 or 34

Gauge of hard Aluminium sheets. This material can be procured from any

reputed dealers of Aluminium sheets. The other consumables required are PVC

coated Wads which are available in all cities. Printing can be done on job work

basis.

5. Land & Building

A rented place with 2000 sqft. area is required. The monthly rent is estimated

at Rs.20,000 and also an advance of Rs.200 000.

6. Utilities

Power:
The total power requirement of the unit will be 20 HP

Water:
Water is required only for human consumption.

Man power:
Category Nos. Monthly Total monthly

Salary Salary
Super 1 8000 8000

Skilled 3 6000 18000

Unskilled 2 4000 8000

Assist 1 5000 5000

Security 2 4000 8000

47000

Add : Benefits 20% 9400

Total wages per month 56400

Total wages per annum [Rs.lakhs] Rs.6.77 lakhs

7. Implementation Schedule

If financing arrangement is made available the project can be implemented

within three months period.

8. ASSUMPTIONS
73.45

Installed capacity per annum Pilfer Proof Caps 180 Lakhs Nos
Capacity utilization-Year -1 60%
Year-2 70%
Year-3 80%
Selling price per unit Pilfer Proof Caps Re.0.40 per piece

Material cost at 100% Qty. (inclg. Rate/MT (Rs.) Value

wastage) (Rs.lakhs)

Half Hard Aluminium Sheets 57.6 Mt 111545/MT 64.25

Printing 1.80
PVC Coated Wads 5.00
Packing cost 2.40
Total 73.45

Consumables per annum-at 100% (Rs.lakhs) Included in

materials
Power and Fuel-100% (Rs.lakhs) Rs.1.87 lakhs
Wages & salaries -100% Rs.6.77 lakhs

Repairs & Maintenance p.m. Rs10000/-

Depreciation Written Down Value

Method

General & administration Expenses per Rs.50000/-

month

Selling expenses 3% on Sales

Interest on term loan and Working capital finance 13% p.a.

Income tax provision 34% on profit

LIST OF MACHINERY SUPPLIERS
1. Narendra Press-tech pvt ltd
P.P.26,27 & 9/97(V) Lane no.10
Behind Police Station
Anand Prabhat Industrial Estate
New delhi-110 005.

2. Advance Packaging
10/65 Industrial Area
Kirti nagar
New Delhi-110 015

LIST OF RAW MATERIAL SUPPLIERS

1. Premier Metal engineering Corporation
JVL Towers
117, Nelson Manikem Road
Chennai-600 029.
2. Southern Aluminium Company
New No.22, Mooker Nallamuthu Street
Chennai-600 001.

3. Zenith Traders
New No.62, Nynuyappa naicken street
Chennai-600 003.

4. Tamilnadu Aluminium Company

44, basin Bridge Road
Mint
Chennai-600 025
FINANCIAL ASPECTS

1. COST OF PROJECT
[Rs.lakhs]

Land & Building (Advance) 2.00

Plant & Machinery 18.00
Other Misc. assets 1.00
Pre-Operative expenses 2.00
Margin for WC 1.78
24.78

2. MEANS OF FINANCE

Capital 11.28
Term Loan 13.50
24.78

3. COST OF PRODUCTION & PROFITABILITY STATEMENTS

Years 1 2 3

Installed Capacity (lakhs) 300 300 300

Utilisation 60% 70% 80%
Production/Sales p.a. (lakhs) 180 210 240

Selling Price/ lakh caps (Rs.lakhs) 0.40 lakh

Sales Value (Rs.lakhs) 72.00 84.00 96.00

Raw Materials (Including consumables) 44.07 51.42 58.76
Power 1.12 1.31 1.50
Wages & Salaries 6.77 7.11 7.47
Repairs & Maintenance 1.20 1.26 1.32
Depreciation 3.15 2.68 1.83
Cost of Production 56.31 63.78 70.88

Admin, & General expenses 6.00 6.30 6.62

Selling expenses 2.16 2.52 2.88
Interest on Term Loan 1.76 1.54 1.10
Interest on Working Capital 0.73 0.73 0.73
Total 66.96 74.87 82.21

Profit Before Tax 5.04 9.13 13.79

Provision for tax 1.71 3.10 4.69
Profit After Tax 3.33 6.03 9.10

Add: Depreciation 3.15 2.68 1.83

Cash Accruals 6.48 8.71 10.93

4. WORKING CAPITAL:

Months Values % Margin Bank

Consumption Amount Finance

Raw Materials 0.75 2.75 25% 0.69 2.06

Consumables 1.00 0.00 25% 0.00 0.00
Finished goods 0.25 1.17 25% 0.29 0.88
Debtors 0.50 3.00 10% 0.30 2.70
Expenses 1.00 0.50 100% 0.50 0.00
7.42 1.78 5.64
5. PROFITABILITY RATIOS BASED ON 80% UTILISATION

Profit after Tax 9.10

9%
Sales 96.00

Profit before Interest and Tax 15.62

51%
Total Investment 30.42

Profit after Tax 9.10

81%
Promoters' Capital 11.28

6. BREAK EVEN LEVEL

[Rs.lakhs]
Fixed Cost (FC):
Wages & Salaries 7.47
Repairs & Maintenance 1.32
Depreciation 1.83
Admin. & General expenses 6.62
Interest on TL 1.10
18.34

Profit Before Tax (P) 13.79

FC x
BEL = 100 18.34 x 80 x 100
FC +P 32.13 100

46% of installed capacity