PAPER MADE CARRY BAG Introduction: Paper carry bags are common packaging materials being used by the

textiles and cloth merchants, dry cleaners, bakers, grocers, stationers, sweet sellers etc. Market Potential: Establishment of shopping complexes and consumer stores in the rural, semi-urban and urban areas, the demand for paper bags has increased. Due to ban on polythene carry bags the demand has been growing very fast. Production Target: i) Quantity : 15,00,000 Nos. ii) Value : Rs 45.00 lakhs Raw materials: Sl.No. Particulars i) ii) iii) iv) v) Paper in roll Gum Printing Ink Eyelet Lace : : : : :

Qty. 1,00,000 Kg. 300 Kg. 100 Kg 750 Pkt 75 kg

Rate @ Rs 30/kg @ Rs 25/kg @ Rs 200/kg @ Rs 50/Pkt. @ Rs 100/kg Total

Value (Rs akhs) 30.00 0.08 0.20 0.38 0.07 30.73

Process: The major process steps are: i) ii) iii) iv) v) vi) Cutting paper into proper size by cutting machine. Printing the paper as per need. Making bags by automatic bag making machine. by folding, pasting, & shearing. Punching Eyelet fitting Lace fitting.

Machinery: The major machineries & equipment required are i) ii) iii) iv) Automatic paper bag making machine. Creezing machine. Cutting machine. Misc. tools and equipments.

Infrastructure: The major infrastructure required are Covered Area : Power : Location: The suggested locations are Assam Arunachal Pradesh Meghalaya Nagaland Tripura Manipur Sikkim

400 sq.mt. 10 HP

: : : : : : :

Guwahati, Jorhat, Tinsuki Itanagar, Shillong, Dimapur, Agartala, Imphal, Gangtok & other Dist. H. Q.

111

Total Capital Requirement: The total capital requirement including fixed capital and working capital is estimated at Rs 14.73 lakhs as follows. Of this, the project cost comprising fixed capital and margin money on working capital is Rs 10.88 lakhs. A. Fixed Capital: Land building Plant & Machinery Miscellaneous fixed assets Preliminary and pre-operative expenses (Rs in lakh) Rented 8.00 0.50 _ 0.30 Total (A) 8.80 ====== 15 days 15 days 1 month 15 days Total (B) Total (A)+(B) Note: Working capital may be financed as: Bank Finance (65%) Margin Money (35%) .. .. Rs 3,85 Lakhs Rs 2.08 Lakhs Rs 5.93 lakhs ============= 1.54 1.82 0.32 2.25 5.93 ==== 14.73

B.

Working Capital: Raw materials Finished goods Working expenses Receivables

Capital Cost of Project: 1. 2. Fixed Cost Margin money for W.C. .. .. Rs 8.80 Lakhs Rs 2.08 Lakhs Rs. 10.88 Lakhs =============

Means of Finance: Promoters contribution (35%) Term Loan (65%) Rs 3.81 lakhs Rs 7.07 lakhs Rs 10.88 lakhs ============

Operating Expenses: The annual operating expenses are estimated at Rs. 40.75 lakhs as given below: (Rs. lakhs) 1. Raw materials: 30.73 2. Packaging materials 0.35 3. Utilities 0.85 4. Wages & Salaries 3.00 5. Rent, Insurance 0.75 6. Other overheads 0.50 7. Selling expenses @ 5% on annual sales 2.25 8. Interest on term loan@ 13.50% 0.95 9. Interest on Bank Finance for Working Capital @12.75% 0.49 10. Depreciation @10% on m/c 0.88 Grand Total 40.75 ===== Sales Realization: Sl.No. Particulars Qty. Rate (Rs) Value (Rs Lakhs) 1.. Paper Carry Bags 15,00,000 3/45.00 TOTAL 45.00

112

Profitability : Based on the sales realization of Rs 45.00 lakhs and the operating expenses of Rs. 40.75 lakhs the profit would be Rs 4.25 lakhs per year. This works out to a return on investment of 29%. The plant will break even at 47% of the rated capacity. Highlight: The major highlights of the project are as follows: Total capital requirement Promoters contribution Annual sales realization (70% cap.) Annual operating expenses (70% cap.) Annual profit (pre-tax) Pre-tax Return on Sales Break Even Point No.of persons employed

: : : : : : : :

Rs 14.73 Lakhs Rs 3.81 Rs 45.00 Rs 40.75 Rs 4.25 9% 47% 6 Nos.

1. Suppliers of Machinery 1. M/s Industrial Paper Machine (P) Ltd., A-32, Phase-I, Naraina Indl. Area, New Delhi M/s. Sandhu Mechanical Engg. Works, Industrial Area-A, Plot No. 32, Ludhiana M/s Rupal Industries (Regd.), 728, Industrial Area-B, Ludhiana M/s. Indo Europe Trading Co., 1980, Chandni Chowk, Delhi- 6 M/s Kohli Industries, 29, Sona Udyog Indl. Estate, Parsi Panchayat Road, Andheri (E), Mumbair

2. Suppliers of Raw Materials. 1. M/s Punalur Paper Mills, Punalur, Kerala M/s Star Paper Mills Ltd., Saharanpur UP M/s Rohtas Industries Ltd., Dalmianagar Bihar M/s Paper & Pulp Conversion Ltd. 376, Shukrawar Peth, Bihar. M/s Ballarpur Paper Mills Ltd. Ballarpur, Dist: Chanda, Maharastra. M/s Sirpur Paper Mills Ltd. Sirpur, Kaghaznagar Andhra Prades.

2.

2.

3.

3.

4.

4.

5.

5.

6.

113