PUFFED RICE

1.

Introduction
Puffed Rice is a commonly consumed commodity as a pastime snack. It

can be used in combination with nuts such as groundnut or roasted and salted
cashews; with fried gram; with jaggery and coconut gratings, or dusted with salt
and spices after enrobing with oil. Since the product is easily digested and
assimilated, it finds a wide acceptance among a cross section of the households.
It is a versatile product with an excellent market potential.
2.

Market
The major market outlets are the A and B class outlets. The product

also finds placement in self service counters and departmental stores. Some C
class outlets also stock the product.
3.

Packaging
The processed product is packed in 50 grams and 100 grams pouches.

4.

Production capacity

The plant will be in operation for one shifts a day.

The plant operates to a production capacity of 25 kilograms per hour.

The estimated production per day is 200 kilograms.

The total production per month will be 5 M.T while the annual production is
estimated at 60 M.T

5.

The time period required for achieving full capacity utilization is one year.
Sales revenue
The ex-factory selling price will be Rs. 50 per kilogram thereby yielding a
sales revenue of Rs. 30 lakhs on full capacity utilization.

6.

Production process outline.

Rice is first cleaned to remove stones and husk. It is then soaked in brine

solution and dried. On drying it is fed into the puffing machine from where the

puffed product is obtained. It is cooled and packed immediately to prevent

moisture absorption.
7.

8.

Quality specifications
Moisture
- Maximum 2.0%
Mold and fungal growth
- Absent
Stones and mud
- Absent
Total plate count
- Maximum 10,000 per gram
Coliforms
- Absent
Salmonella
- Absent
Streptococci
- Absent
Pollution control measures
Not necessary as there are no pollutants or effluents.

9.

Energy conservation measures

Common measures will do.

10.

Land and construction cost for the proposed unit

The processing area is to be taken up on lease. The area required is 1600

square feet as described below.

Sl
Description
1
Processing area
2
Raw material store (paddy)
3
Finished goods storage room
4
Packaging material storage room
5
Office space
6
Toilet space
7
Total
Lease rent Rs. 5.00 per square foot
Total rent per month Rs. 8000
Lease advance Rs. 40000

Sq. feet
500
400
400
100
100
100
1600

11.
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5
12.
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5
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8
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13
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15
16
17
18
19
20

Costing of machinery and equipment

Description

Rs. lakhs
0.250
1.250
0.350
0.150
2.000

Description

Rs. lakhs
On lease
On lease
2.000
0.000
3.760
0.000
0.000
0.250
0.350
0.200
0.050
0.500
0.320
0.100
0.300
0.100
2.000
0.150
0.500
10.580

Paddy destoner
Puffing machine with accessories
Storage silo
Weighing scales and accessories
Total
Project cost
Land
Civil works
Plant machinery
Laboratory equipment

Transport vehicle (Tata Ace)

Pollution control equipment
Energy conservation equipment
Cost of power connection
Cost of electrification
Erection and commissioning
Cost of machinery spares
Cost of office equipment
Deposits if any
Company formation expenses
Gestation period expenses
Sales tax registration expenses
Initial advertisement and publicity
Contingencies
Working capital margin money
Total

13.

Working capital requirements per month

a.

Salaries and wages

Sl

Description

1
2
3
4
5
6
7

Production In charge (female)

Production supervisor (female)
Skilled workers (female)
Unskilled workers (female)
Packing workers (female)
Driver
Total

b.
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1
2

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1
2
3

1
1
1
2
2
1
8

Raw material requirement per month

Qty
Description
(kgs)
Rice
5000
Total raw material

c.

No of
persons

Total
salary /
month
(Rs. lakhs)
0.080
0.060
0.050
0.060
0.040
0.050
0.340

Rate / kg
(Rs)
16.00

5000

Value
(Rs. lakhs)
0.800
0.800

Packaging material requirement per month

Rate / unit
Description
Qty
Rs)
Primary packaging
20000 nos
1.00
material poly
propylene pouches
HDPE bags
4000 nos
5.00
Total

Value
(Rs. lakhs)
0.200
0.200
0.400

Total raw + packaging material = Rs. 1.200 lakhs

d.
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1
2
3
4

Utilities per month

Description
Power 2000 kwh @ Rs. 5.50 per unit
Water
Boiler fuel
Total utilities

Rs. lakhs
0.110
0.010
0.000
0.120

e.

Contingent expenses per month

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1
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3
4
5
6
7
8
9
10
11
12
f.
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3
4
5
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4

Description
Rent for processing shed
Postage and stationery
Telephones, fax etc.
Consumable stores
Repairs and maintenance
Local transports, loading and unloading
Advertisement and publicity @ 5% of sales
Insurance
Sales expenses @ 1% of sales
Miscellaneous expenses @ 1% of sales
Trade incentives @ 2% of sales
Total contingent expenses

Rs. lakhs
0.080
0.010
0.050
0.020
0.028
0.100
0.125
0.006
0.025
0.025
0.050
0.519

Total working capital requirement per month

Description
Rs. lakhs
Salaries and wages
0.340
Raw material and packaging material
1.200
Utilities
0.120
Contingent expenses
0.519
Total
2.179
Means of finance
Description
Total Project Cost
Equity
Debt
Working capital margin money

Rs. lakhs
10.580
3.527
7.053
0.500

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16.

Financial analysis
Description
Total recurring cost per year
Depreciation on land and building
Depreciation on machinery and vehicle
Depreciation on furnaces
Depreciation on moulds and fixtures
Depreciation on office equipment
Interest on long term loan @ 12%
Interest on short term borrowings@ 12%
Total cost of production

Turnover per year

Sl

Item

Qty

Puffed rice

60000 kgs

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5

Rs. lakhs
26.148
0.000
0.355
0.000
0.020
0.100
0.846
0.213
27.682

Rate/unit
(Rs)
50

Viability analysis
Description
Net profit before income tax (Rs. lakhs)
Net profit ratio
Internal rate of return
Break even percentage
Debt service coverage ratio

Total
Rs. lakhs
30.00

Value
2.318
7.7%
20.8%
54%
1.868

List of machinery suppliers for puffed rice

Machinery has to be fabricated locally as per customers requirements.