A

PRODUCT PROJECT REPORT

ON
BEARINGS
Prepared by
Kotadiya chirag j.
Class
T.Y. B.B.A.
Academic year
2009-10
Roll no
33
Seat no

Collage
Shree gyanyagna collage of science of management, Rajkot
Submitted to
Saurastra University
Guided by
Prof. Namita talsaniya

1
 DECLARATION
I, undersigned KOTADIYA CHIRAG as a management student of T.Y. B.B.A.
declare that the product project report as per the saurastra university’s rules and
regulation and syllabus of T.Y. B.B.A. which is prepared by me and with the valuable
guidance of prof. namita talsaniya.
The product project report on the BEARINGS is submitted to gyanyagna collage
of science and management, B.B.A. department, Rajkot.
This is my original work and not submitted to any other collage or university.

Date:-
Place: - Rajkot
Chirag kotadiya

2
 PREFACE
In today’s life management is very much important. Management is the backbone
of any organization or any activity done. The real success of any management is lies in
applying the professional management in all managerial activities. As we move in to the
era of intense competition and high performance expectations. It is important that we
develop the winning edge.
Hence toattaion this objectives and to have the out look of all interactive of
corporate world. I have prepared the product project report on BEARINGS. I have tried
my best and have applied all my efforts, knowledge and sources available in this product
project report.

3
 ACKNOWLEDGEMENT
I am very much thankful to all those people who helped me in preparing the
product project report on BEARING.
I am obliged to our project guide prof. namita talsaniya for giving the valuable
guidance in furnishing this project. I am also thank full to my all those friends and other
persons who directly or indirectly guide me to make my product project report more and
more improving.

4
 INDEX
Sr.no. Particulars Page no.
1 Introduction to small 6
scale industry
2 Project at a glance 7
3 Promoter’s back ground 8
4 Basis and presumption 10
5 Implementation schedule 11
6 Location justification 12
7 Product detail 13
8 Management sat up 14
9 Market analysis 15
10 Technical aspects 16
11 Financial details 21
12 Risk factor 37
13 Future plan 38

5
 1. INTRODUCTION TO SMALL SCALE INDUSTRY
An industrial unit whose capital investment in plant and machinery is up to 5
crores of rupees are known as the small scale industry. For the nits supplying the spare
parts and other components to the medium and large scale industry. The limit is also
covers only investment in the plant and machinery. Land and factory building are
excluded because there are wide variations of land prices at different places.
Small scale industry is occupying an important place in the industrial development
of backward or less economies like India. It’s important is given below.
– The capital requirement to start the S.S.I. is lower in comparison of the medium
scale and large scale unit.
– Less capital is requiring per unit of labor. Hence small scale units can generate
large volume of the employment.
– Small scale industries utilize local materials and resources therefore it does not
require foreign exchange to import materials and resources.
– It caters to local needs in a better way as per the local customs and traditions.

6
 2. PROJECT AT GLANCE
Unit’s name: - X’treme enterprise
Address for communication: - Q– 35, G.I.D.C. metoda,
Kalawad road,
Ta. Lodhika,
Dist. Rajkot – 360005
Type of unit: - partnership firm
Product: - Ball Bearings
S.S.I. registration no. : - has been applied for
Subsidy registration no: - has been applied for
Bankers: - State bank of India
I.D.B.I.
Cost of project: - 49, 01,200

7
 3. PROMOTER’S BACKGROUND
PARTNER – 1
Name : - kotadiya chirag j.
Age :- 21 years
Education qualification: - B.B.A. with advanced marketing management
Address: - “shree ram”
Maruti Park – 1,
B/h big bazaar,
150ft ring road,
Rajkot – 360005.
Work division: - administration, accounting, marketing & selling
Capital contribution: - 25%
Share in profit and loss: - 50%

8
PARTNER - 2
Name: - dobariya kirit m.
Age: - 21 years
Education qualification: - B.E. (mechanical)
Address: - 402, mangal bhuvan appt.
Kalawad road,
Rajkot – 360005.
Work division: - quality control, manufacturing management, material handling.
Capital contribution: - 25%
Share in profit and loss: - 50%

9
 4. BASIS AND PRESUMPTION
– Wages are to be paid on the basis of prevailing wage rate in market.
– Interest rate on borrowed capital is on the basis of IDBI bank’s rate on 15 June
2009.
– Building is assumed on the basis of current rent prevailing in market on 15 June
2009.
– The factory hours will be of 12 hours of a day.
– 25 working days in a month is assumed
– 280 working days in a year are assumed.

10
 5. IMPLEMANTATION SHEDULE
Particulars days
Selection of site 15 days
Preparation of project 45 days
Acquiring of land and building 30 days
Registration of SSI 30 days
Acquiring of finance 60 days
Arrangement of machinery & equipments 45 days
Installation of machines & electrification 60 days
Recruitment of personal & labor 45 days

11
 6. LOCATION JUSTIFICATION
The entrepreneur must select an ideal location n at the time of launching of the
enterprise. Location of the factory is an important factor affecting the business
organization. An ideal means a scientific selection includes nature and type of the
business, opening advantage, economic factors and profit orientation.
The cost of the production and the cost of the distribution play an important role in the
profit maximization. Even if with the adequate capital on hand, if the location is
unfavorable, will affect are profitability which may sometimes results into the closed
down of the unit.
It is preferable to start in Rajkot due to several factors that are as under:
– The essential raw material require for the manufacturing of bearing like inner,
outer, races, rollers, cages, washers etc. are easily available within the city itself.
– There is labor available at cheap price and available at cheap price and all
technical staff can be acquired from Rajkot also.
– Electricity, banking, water, and internet services are available in the city.
– The other major factor is that there is big market is available for bearing within the
Rajkot i.e. local market itself is wide.
For ex, oil engines industries existing in Rajkot and bearing are use in its
manufacturing.

12
 7. PRODUCT DETAILS
Bearing is a mechanical element that permits relative motion between two parts,
such as the shaft and the housing, with minimum friction. The function of bearing is as
under.
– The bearing ensures free rotation of the shaft or the axle with minimum friction
– Bearing supports the shaft or the axle and holds it in correct position
– The bearing takes up the forces that act on the shaft or the axle and transmits them
to the foundation.

So, bearing is a vital component in any rotation mechanism of machinery.

13
 8. MANAGEMENT SETUP
The two partners are entitled to take the post of directors their names are

– Mr. kotadiya chirag j.

– Mr. Dobariya kirit m.

The capital ratio of both partners will be 50 : 50 and profit and loss will be
shared as per capital sharing ratio.

Mr. chirag kotadiya will look after the marketing and trade setting and
administrative and accounting work as he is qualifying in B.B.A.

Mr. kitit dobariya will look after the production management, quality
control and technical matter of factory and material management.

14
 9. MARKET ANALYSIS
A) HISTORY

In India bearing industry can be traced to a little over 50 years. The first
unit to commercial production was national bearing co. ltd., Jaipur. Some small
scale units in panjab and some other places also manufacturing bearings. Bearings
industry developed tremendously in small scale sector during the late eighties and
beginnings of nineties has mostly developed in Gujarat state and that too
particularly in saurastra region.
The raw material used for manufacturing bearing are produced from
Mahindra and Mahindra, Bihar alloys, special sheets etc.
As against global range 1, 50,000 different types of bearings are used in
India. The indigenous production of bearing is limited to about 700 types.

B) CURRENT MARKET POSSITION

The current market position of Indian bearing industry is worth rs. 3500
crore. 45% of the market segment is covered by automotive segment and
remaining 55% of the market segment is covered by industrial demand. In
automotive segment 50% of market is organized segment manufacturers 15% are
unorganized segment in India and remaining 35% of demand is satisfied by
import.

C) FUTURE MARKET POSSITION

Out of the total revenues in the automotive segment, 60% of the revenues
are contributes by original equipment manufacturers and the remaining 40% is by
the demand from the after market. There has been a growth of 15% in the after
market segment and OEMs demand has increased by more then 25%
The market for automotive bearing is growing at almost 27% per annum.
This is mainly because of multiple models in every vehicles segment entering the
market.
Hence, a definite increase in the original equipment segment is antiseptic.
After market demand for automotive bearing is increasing, but at a slower rate as
compared to the growth in vehicles population manufacturers are expecting
sustained growth of 15% in the after market mainly due to increase in population
of two wheelers, passengers cars and utility vehicles segment.

15
 10.TECHNICAL ASPECTS
A) MANUFACTURING PROCESS.

Material for Races

Rollers from mill.

Turning of
Races

Heat Treatment

Grinding

Super Finishing of
Races + Rollers

100% Noise testing before dispatch

+
Dust Proof Assay Line.
+
Imported washing line

Distribution
There are four major parts to a standard ball bearing: the outer race, the rolling balls, the inner
race, and the cage.
16
Races
• Both races are made in almost the same way. Since they are both rings of steel, the
process starts with steel tubing of an appropriate size. Automatic machines similar to
lathes use cutting tools to cut the basic shape of the race, leaving all of the dimensions
slightly too large. The reason for leaving them too large is that the races must be heat
treated before being finished, and the steel usually warps during this process. They can be
machined back to their finished size after heat treating.
• The rough cut races are put into a heat treating furnace at about 1,550 degrees Fahrenheit
(843 degrees Celsius) for up to several hours (depending on the size of the parts), then
dipped into an oil bath to cool them and make them very hard. This hardening also makes
them brittle, so the next step is to temper them. This is done by heating them in a second
oven to about 300 degrees Fahrenheit (148.8 degrees Celsius), and then letting them cool
in air. This whole heat treatment process makes parts which are both hard and tough.
• After the heat treatment process, the races are ready for finishing. However, the races are
now too hard to cut with cutting tools, so the rest of the work must be done with grinding
wheels. These are a lot like what you would find in any shop for sharpening drill bits and
tools, except that several different kinds and shapes are needed to finish the races. Almost
every place on the race is finished by grinding, which leaves a very smooth, accurate
surface. The surfaces where the bearing fits into the machine must be very round, and the
sides must be flat. The surface that the balls roll on is ground first, and then lapped. This
means that a very fine abrasive slurry is used to polish the races for several hours to get
almost a mirror finish. At this point, the races are finished, and ready to be put together
with the balls.
Balls
• The balls are a little more difficult to make, even though their shape is very simple.
Surprisingly, the balls start out as thick wire. This wire is fed from a roll into a machine
that cuts off a short piece, and then smashes both ends in toward the middle. This process
is called cold heading. Its name comes from the fact that the wire is not heated before
being smashed, and that the original use for the process was to put the heads on nails
(which is still how that is done). At any rate, the balls now look like the planet Saturn,
with a ring around the middle called "flash."
• The first machining process removes this flash. The ball bearings are put between the
faces of two cast iron disks, where they ride in grooves. The inside of the grooves are
rough, which tears the flash off of the balls. One wheel rotates, while the other one stays
still. The stationary wheel has holes through it so that the balls can be fed into and taken
out of the grooves. A special conveyor feeds balls into one hole, the balls rattle around the
groove, and then come out the other hole. They are then fed back into the conveyor for
many trips through the wheel grooves, until they have been cut down to being fairly
round, almost to the proper size, and the flash is completely gone. Once again, the balls
are left oversize so that they can be ground to their finished size after heat treatment. The
amount of steel left for finishing is not much; only about 8/1000 of an inch (.02
centimeter), which is about as thick as two sheets of paper.
• The heat treatment process for the balls is similar to that used for the races, since the kind
of steel is the same, and it is best to have all the parts wear at about the same rate. Like
the races, the balls become hard and tough after heat treating and tempering. After heat
17
 treatment, the balls are put back into a machine that works the same way as the flash
remover, except that the wheels are grinding wheels instead of cutting wheels. These
wheels grind the balls down so that they are round and within a few ten thousandths of an
inch of their finished size.
• After this, the balls are moved to a lapping machine, which has cast iron wheels and uses
the same abrasive lapping compound as is used on the races. Here, they will be lapped for
8-10 hours, depending on how precise a bearing they are being made for. Once again, the
result is steel that is extremely smooth.
Cage
• Steel cages are stamped out of fairly thin sheet metal, much like a cookie cutter, and then
bent to their final shape in a die. A die is made up of two pieces of steel that fit together,
with a hole the shape of the finished part carved inside. When the cage is put in between
and the die is closed, the cage is bent to the shape of the hole inside. The die is then
opened, and the finished part is taken out, ready to be assembled.
• Plastic cages are usually made by a process called injection molding. In this process, a
hollow metal mold is filled by squirting melted plastic into it, and letting it harden. The
mold is opened up, and the finished cage is taken out, ready for assembly.
Assembly
• Now that all of the parts are made, the bearing needs to be put together. First, the inner
race is put inside the outer race, only off to one side as far as possible. This makes a space
between them on the opposite side large enough to insert balls between them. The
required number of balls is put in, then the races are moved so that they are both
centered, and the balls distributed evenly around the bearing. At this point, the cage is
installed to hold the balls apart from each other. Plastic cages are usually just snapped in,
while steel cages usually have to be put in and riveted together. Now that the bearing is
assembled, it is coated with a rust preventative and packaged for shipping.

18
 B) PRODUCTION CAPICITY

Name of the Rate(rs) Daily Monthly Production Total

product production(units) production par annum value(rs)
units

Ball bearing 110 380 9500 114000 1,25,40,000

19
 C) DETAILS OF RAW MATERIAL

PARTICULARS AMT (rs.)

Forgings( races ) 3,32,500
9500 sets @ 35
Rollers ( balls ) 2,40,000
24000 pieces @ 10
Cages 76,000
19000 pieces @ 4
Total Raw material (p.m.) 6,48,500

20
 11.FINANCIAL DETAILS

A) LAND & BUILDING

As the financial capacity of partners are not enough to purchase the land &
building. So, they will hire land and building on rent.

The details of land and building are as under.

1) Total area covered - 1000 sq. meter

2) Shade covered - 800 sq. meter
3) Open space - 200 sq meter
4) Monthly rent - 12,000 p.m.
5) Total rent - 1, 44,000 p.m.

21
B) MACHIMARY & EQUIPMENT

NAME OF QUANTATY NO. HORCE POWER PRICE

MACHINE
Surface grinding 1 10 h.p. 4,00,000
machine
Center less grinding 1 5 h.p. 4,00,000
machine
Bore grinding 1 3 h.p. 4,00,000
machine
External grinding 1 3 h.p. 4,50,000
machine
Honing machine 1 2 h.p. 3,00,000
Etching machine 1 1 h.p. 7,000
Belt grinding 1 1 h.p. 5,000
machine
Centrifugal 1 1 h.p. 10,000
(cleaning machine)
Lathe machine 1 2 h.p. 15,000
Drill machine 1 - 7,000
Bench machine 1 - 4,000
Hardness tester 1 - 10,000
Inspection, quality - - 2,00,000
control equipment
gauges etc.
Tools, spindles, - - 50,000
fixtures.
Erection & - - 2,00,000
installation
Furniture & office - - 55,000
equipments
Total 25,13,000
Pro- operative 50,000
expense
Total 25,63,000

Total investment in fixed assets

22
Machinery and equipment 25, 63,000

23
INVESTMENT IN SHORT TERM ASSETS
A) Cost of raw material (p.m.)

PARTICULARS AMT (rs.)

Forgings( races ) 3,32,500
9500 sets @ 35
Rollers ( balls ) 2,40,000
24000 pieces @ 10
Cages 76,000
19000 pieces @ 4
Total Raw material (p.m.) 6,48,500

24
B) Salary and wages
Particulars Rate (p.m.) No. of persons Total salary
(p.m.)
Salary to partners 5,000 2 10,000
Supervisor 3,500 1 3,500
Skilled workers 3,000 6 18,000
Unskilled workers 2,500 8 20,000
Total 51500
Prerequisitesof 5,150
salaries @ 10%
Total salary 5,6650

C) UTILITIES

Power consumption

4500 units’ p.m. @ 4.50 rs.

4000 × 4.5 = 20,250

25
D) Other expanses
Particulars Rate (p.m.)
Rent 12000
Consumable like grinding wheel, 10,000
kerosene, grease, cuttings oil etc.
Telephone exp. 1,500
Repairs and maintenance 3,500
Advertisement & publicity 5,000
Packing and forwarding 9,000
Marketing and sales 3,500
Traveling & conveyance 4,500
Transport of raw material 1,000
Insurance 1,500
Miscellaneous expanses 1,500
Postage and stationary 1,000
Total 54,000

26
E) TOTAL INVESTMENT IN WORKING CAPITAL
PARTICULARS AMT (RS)
Raw material 6,48,500
Salaries and wages 56,650
Utilities 20,250
Other expenses 54,000
Total 7,80,400

Working capital for 3 months

7, 79,400 × 3 = 23,38,200

27
TOTAL COST OF PROJECT
Particulars Amt (rs)
Fixed cost 25,63,000
Working capital for 3 months 23,38,200
Total 4901200

28
DETAILS OF MEANS OF FINANCE

Particulars Amt (rs.)

Owned capital
Partner 1 (25%) 12,25,300
Partner 2 (25%) 12,25,300
Borrowed capital (50%) 24,50,600
Total 49,01,200

Interest on borrowed capital (21%) =5, 14,626 p.a.

29
TOTAL COST OF PRODUCTION
A) RAW MATERIAL
PARTICULARS AMT (rs.)
Forgings( races ) 3,32,500
9500 sets @ 35
Rollers ( balls ) 2,40,000
24000 pieces @ 10
Cages 76,000
19000 pieces @ 4
Total Raw material (p.m.) 6,48,500

Total raw material (p.a.) 7,78,2000

6,48,500 × 12

B) RENT & INSURANCE

Particulars Amt (rs.)

Rent 12,000
Insurance 1,500
Total (p.m.) 13,500
Total (p.a.) 1,62,000
13,500 × 12

30
 C) Salary and wages
Particulars Rate (p.m.) No. of persons Total salary
(p.m.)
Salary to partners 5,000 2 10,000
Supervisor 3,500 1 3,500
Skilled workers 3,000 6 18,000
Unskilled workers 2,500 8 20,000
Total 51500
Prerequisites of 5,150
salaries @ 10%
Total salary 56,650
Total (p.a.) 6,79,800
56,650 × 12

D) ADMINISTRATIVE EXPENCES
PARTICULARS AMT. (rs.) (p.m.)
Postage & stationary 1,000
Telephone exp. 1,500
Travelling expenses 4,500
Miscellaneous exp. 1,500
Total exp (p.m.) 8,500
Total (p.a.) 1,02,000
8,500 × 12

31
 E) SELLING AND DISTRIBUTION

PARTICULARS AMT(rs.)
Marketing and sales 3,500
Advertisement & publicity 5,000
Packing & forwarding 9,000
Total (p.m.) 17,500
Total (p.a.) 2,10,000
17,500 × 12

F) REPAIRS AND MAINTANANCE

Repairs and maintenance

3500 × 12 = 42,000 (p.a.)

G) CONSUMABLES

Gridding wheels, kerosene, grease, cutting oil, etc.

10,000 × 12 = 1, 20,000

32
TOTAL COST OF PRODUCTION
PARTICULARS AMT (rs.) (p.a.)
Raw material 77,82000
Rent & insurance 1,62,000
Salary & wages 6,79,800
Administration exp. 1,02,000
Selling and distribution 2,10,000
Repairs and maintenance 42,000
Consumable 1,20,000
Total cost (p.a.) 91,03,800

33
COST OF RUNNING BUSINESS
Particular Amt (rs)
Total cost of production 91,30,800
Interest on borrowed capital 5,14,626
24,50,600 × 21%
Depreciation on office equipment 11,000
55,000 × 20%
Depreciation on machinery & 1,99,800
equipment
19,98,000 × 10%
Depreciation on tools, fixtures, 92,000
measuring and testing equipment
4,60,000 × 20%
Total cost 99,21,226

34
 TURN OVER

Particulars Amt (rs.)

Yearly sales of 1, 14,000 pcs. @ 110 1,25,40,000

Yearly sales of scrap 1,50,000

Total turnover (p.a.) 1,26,90,000

NET PROFIT
PARTICUALRS AMT.
Sales 1,26,90,000
Less: cost of running business 99,21,226
Total 27,68,774
Less: 35% tax 9,69,070
Net profit 17,99,704

35
BREAK EVEN ANALYSIS

Particulars Amt(rs.)
Rent 1,44,000
depreciation on office equipment 11,000
Depreciation on machinery 1,99,800
Depreciation on tools, fixtures, measuring 92,000
& testing equipment
40% of salaries& wages 2,71,920
40% of other contingent exp. 4,98,000
Insurance 18,000
Total fixed cost 17,49,346

BREAK EVEN POINT =

Fixed cost
× 100
Fixed cost + net profit

17, 49,346
= × 100
17, 49,346 + 17,99,704

= 49.29%

36
 CALCULATION OF DIFFERENT RATIOS

NET PROFIT RATIO

Net profit
= × 100
Sales

17, 99,704
= × 100
1, 26, 90,000

= 14.18%

RATE OF RETURN
Net profit
= × 100
Cost of production
17, 99,704
= × 100
49, 01,200
= 36.72 %

37
 12 RISK FACTOR
– Due to improved technology, improved fuel quality and better maintenance of
vehicles it reduces replacement rate which turn in to slower growth in after market
segment.
– Vehicles owners prefer imported bearings due to lower costs. Cost different is
almost 50% between domestic bearing and imported from china’s bearings
– The bearing industry also suffers from structural deficiencies, which are making it
less competitive in the global market
– In this industry, there is preveling high competition in market. There are many
huge companies are involved in this business.

38
 13 FUTURE PLANS

The future plan of the company will be to become world class bearing and
auto parts manufacturing company.
The company will expand its market up to international level

39