PROJECT FEASIBILITY REPORT

LIST OF CONTENTS

PROJECT HIGH LIGHTS

FINANCIAL HIGH LIGHTS

1. Introduction.
2. Structure of the company.
3. Product description.
4. Industrial applications of castings.
5. Explanation to manufacturing process.
6. Capacity of the foundry.
7. Product mix and sales turnover.
8. Production programme.
9. Project parameters

8.1. Raw materials and consumables.

8.2. Infrastructure power and utilities.
8.3. Plant and machinery.
8.4. Manpower and organization.
8.5. Environmental impact study.
8.6. Project schedule.

9. Project economics and financial evaluation

9.1. Capital outlay.

9.2. Source of financing.
 (Contd…)
9.3. Working capital requirements.
9.4. Production cost estimation.
9.5. Depreciation.
9.6. Interest.
9.7. Taxes.
9.8. Projected profitability.
9.9. Fund flow statement

10. Financial analysis

10.1. Key ratios.

10.2. Break Even analysis.
10.3. Return on investment.

11. Recommendation and action plan.

12. LIST OF ANNEXURES

1. Foundry activity flow chart.

2. Foundry process flow chart.
3. List of major equipments and power.
4. List of major raw materials and consumables.
5. Typical material specification details.
6. Organization chart.
7. Man power tables.
8. Preliminary site plan and plant layout.
9. Project feasibility (assumptions).
 INTRODUCTION

SRI VASAVI TECHNOCAST PVT. LTD. is a new project being planned for the
production of ductile, grey and alloy cast iron castings mainly catering to the casting
requirements of steel plants, earth moving and mining equipments.

The plant is proposed to be located in Shimoga / Bhadravathi Industrial area on a plot

measuring 67.5 X 110MTS.(7425 SQMTS) with a built-up area of 2100 SQMTS after
completion of the project.

The project has been meticulously planned keeping in mind safety and environmental
concerns. The foundry will be equipped which electrical induction melting system and
environmental friendly green sand and CO2 moulding system with reclamation unit
enabling recycling of moulding sand to a larger extent. Pollution control equipments
such as fume extractor, dust filters, chimney etc. are considered. The foundry will
be accredited with ISO 9001 2000, quality system.

The annual installed capacity of the foundry will be 1600T /yr of casting with
maximum weight of 220 kgs/piece.

The project is being promoted by highly qualified and experienced industrialists with
adequate knowledge of modern equipments, technology and management practices
to ensure high productivity and cost effectiveness in manufacture of quality casting.

The profile of promoters is attached ;

It is proposed to setup a private limited company with promoters equity of

Rs.70,00,000 (Rupees Seventy lakh only) and other funds required will be
availed as loan from financial institutions.

The project feasibility study is presented.

BIO DATA OF THE PROMOTERS :

1. Sri S.D. Subba Rao,

Chief Executive Officer,
M/s. Sri Vasavi Foundry Private Ltd.,
Lower Hutha, Bhadravati – 577 301

Age : 59 Years

Qualification : B.E. (Mech)

Experience : 36 years in various capacities in Sugar, General

Engineering and other process Industries including
one year in Africa and 9 years in Sri Vasavi Foundry,
Bhadravati.

*************************************************************************************

2. Sri Damodar Baliga,

Managing Director,
M/s. Sri Vasavi Foundry Private Ltd.,
Lower Hutha, Bhadravati – 577 301

Age : 63 years

Qualification : B.Sc. (Met.Engg) from BHU, PG Training in

Foundry at IIT, Kharagpur and Statistical Quality
control training from ISI, Kolkata.

Experience : Totally 40 years out of which 14 years at the

foundry division of VISL, Bhadravati, 15 years in
other private sector foundries, 1 year in the
foundries of Germany and 10 years in Sri Vasavi
Foundry, Bhadravati.

*************************************************************************************
 3. Sri B.M. Ramesh
Director (Finance),
M/s. Sri Vasavi Foundry Private Ltd.,
and General Manager, M/s. Sri Rajarajeswari Foundry,
Lower Hutha, Bhadravati – 577 301

Age : 49 Years.
Qualification : B.Com.
Experience : 27 years in Financial and General Management
of Foundry Industry.

*************************************************************************************
4. Sri C.Veerabhadriah,
Proprietor,
M/s. Sri Rajarajeshwari Foundry and
Partner, M/s. Chenna & Co.
Bhadravati.

Age : 67 Years.

Qualification : B.E. (Mech), M.E. (Foundry)

Experience : Totally 45 years out of which 19 years in VISL ,

Bhadravati, 1 year in the foundries of Germany and
the rest as an entrepreneur.

*****************************************************************************************
PROJECT AT GLANCE

Project at glance.xls
FINANCIAL HIGHLIGHTS
..\financial highlights.xls
 1. PRODUCT DESCRIPTION

2.1. DEFINITION

A casting may be defined as a "Metal object obtained by allowing molten metal to

solidify in a mould", the shape of the object being determined by the shape of the
mould cavity. Founding or casting, is the process of forming metal objects by melting
metal and pouring it into moulds. A foundry is a commercial establishment for
founding, or producing castings. Significant in these definitions is the use of liquid
metal to cast the shape of the object directly, producing cast metal. Wrought metal
products differ from cast metal products in that the metal has received mechanical
working treatment such as forging, rolling, or extruding. Practically all metal is
initially cast. Castings obtain their shape principally when molten metal solidifies
in the desired form. Wrought objects,however are cast as ingots and then plastically
worked to approximately the desired shape.

2.2. METAL CASTING, A PROCESS OF SHAPING

The strength of the foundry industry rests on the fundamental nature of casting as a
process for causing metals to take shapes that will serve the needs of man. There
are other methods of shaping, machining, forging, welding, stamping, hot working
etc. Each has applications in which it is unexcelled and others for which it is
unsuited. Rarely is an engineering product completed which does not use several
or all of the fundamental metal processing methods. The foundry industry is thus
built on one of the truly basic methods available for shaping metals to useful ends.
2.3. CASTING ADVANTAGE

Certain advantages are inherent in the metal casting process. These may form
the basis for choosing casting as a process to be preferred over other shaping
processes in a particular case. Some of the reasons for the success of the casting
process follow :

2.3.1 The most intricate of shapes, both external and internal, may be cast.
As a result, many other operations, such as machining, forging, and
welding, may be minimized or eliminated.

2.3.2. Because of their metallurgical nature, some metals can only be cast to
shape since they cannot be hot-worked into bars, rods, plates, or other
shapes from ingot form as a preliminary to other processing. The highly
useful and low-cost cast irons, which exceed the total of all other
metals in tonnage cast, illustrate this fact. ( See world market for C.I
castings ).

2.3.3. Construction may be simplified. Objects may be cast in a single piece

which would otherwise require construction in several pieces and subsequent

assembly if made by other methods.

2.3.4. Metal casting is a process highly adaptable to the requirements of mass

production large numbers of a given casting may be produced very rapidly.
The use of castings in the automotive industry provides ample illustration of
this point.

2.3.5. Extremely large, heavy metal objects may be cast when they would be
difficult or economically impossible to produce otherwise. Large pump
housings, valves and hydroelectric plant parts weighing upto 200 tonnes
illustrate this application.
2.4. ENGINEERING PROPERTIES

Some engineering properties are obtained more favourably in cast metals. Examples
are :

2.4.1. Machinability and vibration damping capacity in cast irons.

2.4.2. More uniform properties from a directional stand point; i.e., properly cast
metals can exhibit the same properties regardless of which direction is
selected relative to the original casting for the test piece. This is not generally
true for wrought metals.

2.4.3. Strength and lightness in certain light metal alloys which can be produced
only as castings.

2.4.4. Good bearing qualities are obtained in cast bearing metals. In general, a
wide range of alloy composition and properties is produced in cast form.

2.4.5 A decided economic advantage may exist as a result of any one or a

combination of points 1 to 6. The price and sales factor is dominant one
which continuously weighs the advantages and limitations of any process
used in a competitive system of enterprise.

2.5. GRAY IRON CASTINGS:

The term GRAY IRON refers to a broad class of ferrous casting alloys normally
characterized by a microstructure of flake graphite in a ferrous matrix. Gray irons are
in essence iron-carbon-silicon alloys containing small quantities of other elements. As
a class, they vary widely in physical and mechanical properties.

The metallurgy of gray iron is extremely complex because of a wide variety of factors
that influence their solidification and subsequent solid-state transformation. In spite of
this complexity, gray irons have found wide acceptance based on a combination of
out-standing castability, excellent machinability, economics, and unique properties.
APPLICATION:

The changes in physical and mechanical properties that can be produced in gray iron
by controlling the characteristics of its free graphite and matrix structures lead to
versatility in its application. Gray iron can be effectively used in highly competitive, low
cost applications where its founding properties are of paramount importance. Such
applications include implement weights, elevator counterweights, guards and frames,
fire hydrants. A variety of iron grades can be used in these applications. Gray iron is
also employed in more critical applications, in which mechanical or physical property
requirements determine iron selection, such as in pressure-sensitive casting,
automotive castings, and process furnace parts.

2.6. DUCTILE IRON CASTINGS

2.6.1. Introduction of ductile iron to the family of cast iron in 1948 made a
revolutionary change in the casting industry due to its diverse engineering
properties.

The ductile irons have proven to be cost effective and a substitute for
malleable irons, steel castings and forgings.

Ductile iron castings are now found in every field of engineering and in every
geographic area of the world. Ductile iron is known by different names such
as S.G.iron and nodular iron.

2.6.2. Flake graphite in the normal cast iron is modified to spherical shape by
treatment with magnesium. Due to spherical shape of graphite (nodules /
spheroids) the stress concentration is reduced thus offering higher strength
and ductility to the castings, and the properties are nearly comparable to
steel. Due to excellent casting properties such as fluidity, machinability etc,
ductile irons can be used for production of the thin walled castings which
offer physical and economical advantage to the user industries.
2.6.3. Ductile irons are characterized by higher strength to weight ratio which
offers great advantages to automobile industry where vehicles are
expected to be lighter and fuel efficient. The weight savings by replacement
of C.I castings by ductile iron castings is estimated as 40% in addition to
enormous savings in machining costs.

Design engineers who are sufficiently informed about the versatile

properties of ductile iron have taken advantage of the performance
potential of ductile iron as a cost effective engineering solution.

2.6.4. The properties of ductile iron castings are basically determined by the
nature of metallic matrix into which graphite spheroids are embedded. The
matrix produced without heat treatment consists of mixture of ferrite and
pearlite. The ferrite surrounds the graphite spheroids. Ferrite contributes to
ductility while pearlite contributes to strength.

2.6.5. The advantages of ductile iron castings are summarized as;

- High strength to weight ratio

- Low cost compared to other materials of similar properties.
- Better surface finish and details
- Excellent casting properties
- Good machinability, reduced machining allowances, lower weight castings.
- Lower production costs
- Several combinations of properties are possible for various applications.
2.6.6. THE FAMILY OF DUCTILE IRONS

Ductile iron is not a single material, but a family of materials offering a wide
range of properties obtained through control of microstructure. Once a high degree of
nodularity is achieved the mechanical properties are determined by the ductile iron
matrix. The major classifications are ;

FERRITIC DUCTILE IRON :

Graphite spheroids in a matrix of ferrite provides good ductility and impact strength
and with a tensile and yield strength equivalent to a low carbon steel. Ferritic ductile
iron can be produced as cast with controlled metallurgy but annealing treatment
can enhance ductility and low temperature toughness.

FERRITIC- PEARLITIC DUCTILE IRON :

This is the most common grade of Ductile iron and is normally produced in the "as
cast" condition. The graphite spheroids are in a matrix containing both ferrite and
pearlite. Properties are intermediate between ferritic and pearlitic grades, with
good machinability and low production costs.

PEARLITIC DUCTILE IRON :

Graphite spheroids in a matrix of pearlite results in an iron with high strength, good
wear resistance, and moderate ductility and impact resistance. Machinability is
superior to steels of comparable physical properties. The preceding three types of
Ductile irons are the most common and are usually used in the as-cast condition, but
ductile iron can also be alloyed and / or heat treated to provide the following grades
for a wide variety of additional applications.
MARTENSITIC DUCTILE IRON :

This type of ductile iron is produced by using sufficient alloy additions to prevent
pearlite formation, and a quench-and-temper heat treatment. The resultant
tempered martensite matrix has very high strength and wear resistance but limited
ductility and toughness.

AUSTENITIC DUCTILE IRON :

Alloyed to produce an austenitic matrix, this ductile iron offers good corrosion and
oxidation resistance, good magnetic properties, and good strength and dimensional
stability at elevated temperatures. Application areas are detailed in market survey.

AUSTEMPERED DUCTILE IRON :

ADI, the most recent addition to the ductile iron family, is a sub-group of ductile
irons produced by giving conventional ductile iron a special austempering heat
treatment. Nearly twice as strong as pearlitic ductile iron, ADI still retains high
elongation and toughness. This combination provides a material with superior wear
resistance and fatigue strength.

A wide choice is therefore available to the design engineer to select appropriate

grade of ductile iron for several engineering applications.

2.6.7 Ductile iron also supplements and extends the properties and application of
malleable irons. It has an advantage of not having to be cast as a white iron
and then annealed for castings having section thickness of 6 mm and above
and it can be manufactured in much thicker section sizes. However thin
sectioned castings may require an annealing treatment to achieve high ductility.
It is easier to make a sound castings in S.G. iron compared to steel and still
have a very high yield thus reducing cost of manufacture. Riser-less designs
are also possible for certain class of ductile iron castings.
2.6.8 Ductile iron is manufactured by treatment of low sulphur and low manganese
iron with an additive containing magnesium / cerium and is usually finally
inoculated during casting with silica containing alloy which will enhance
nodularity. There are several methods available for treatment of magnesium
such as tundish ladles, converters, pure magnesium wire injection, inmould
inoculation etc. Effective treatment method is of primary importance for
production of ductile iron with high nodule count. Carbon silicon controls are
important (see fig.1). While sulphur manganese and trace elements such as
lead, antimony, bismuth, tin, etc., are to be kept under control. Ductile iron
castings are usually poured into rigid moulds to avoid mould dilation.
Accurate control of pouring temperature has beneficial effects on
production of high quality ductile iron castings.

In recent years ductile iron castings are produced in chemically bonded sand
moulds using 100% reclaimed sand. The rigid moulds offer excellent casting
yield, controlled weight of castings, predictable shrinkage behaviour,
excellent surface finish, reduced machining allowances and near net shape
castings thus reducing manufacturing costs for both foundry and user
industry. Castings made in this process are practically free from defects
and require hardly any fettling and cleaning work. Risers and runners are
detached by knock off wedges.
2.7 ALLOY CAST IRONS

The high-alloy white irons are primarily used for abrasion-resistant applications and
are readily cast into the parts needed in machinery for crushing, grinding and handling
of abrasive materials. The chromium content of high-alloy white irons also enhance
their corrosion-resistant properties. The large volume fraction of primary and /or
eutectic carbides in their microstructures provides the high hardness needed for
crushing and grinding other materials. The metallic matrix supporting the carbide
phase in these irons can be adjusted by alloy content and heart-treatment to develop
the proper balance between the resistance to abrasion and the toughness needed to
withstand repeated impact.

All high-alloy white irons contain chromium to prevent the formation of graphite upon
solidification and to ensure the stability of the carbide phase. Most also contain nickel,
molybdenum, copper, or combinations of these alloying elements to prevent the
formation of pearliest in the microstructure. While low-alloy white iron castings, which
have alloy content below 4%, develop hardness in the range of 350 to 550 HB, the
high-alloy irons range in hardness from 450 to 800 HB. In addition, several grades
contain alloy eutectic carbides (M7C3 chromium carbides), which are substantially
harder than the M3C iron carbides in low-alloy irons. For many applications, the
increased abrasion resistance of the more expensive high-alloy white irons adds
significantly to wear life, enabling them to provide the most cost-effective
performance.

The high-alloy white cast irons fall into three major groups:
• Nickel-chromium white irons, white irons, which are low-chromium alloys
containing 3 to 5% Ni and 1 to 4% Cr, with one alloy modification that contains
7 to 11% Cr.

• The chromium-molybdenum irons containing 11 to 23% Cr, up to 3% Mo and

often additionally alloyed with nickel or copper.

• A third group comprises the 25% or 28% Cr white irons, which may contain
other alloying additions of molybdenum and/or nickel up to 1.5%.
 3. INDUSTRIAL APPLICATION OF CASTINGS

- AUTOMOBILE ENGINE AND TRANSMISSION COMPONENTS.

- EARTH MOVING EQUIPMENTS.

- FARMING AND AGRICULTURAL EQUIPMENTS.

- MATERIAL HANDLING EQUIPMENTS.

- CONSTRUCTION AND GENERAL ENGINEERING.

- HEAVY MACHINERY BUILDING.

- MUNICIPALITY, SEWAGE AND WATER SUPPLIES.

- RUBBER AND TYRE MACHINERY.

- PLASTIC INJECTION MACHINES.

- RAILWAYS.

- VALVE MANUFACTURING INDUSTRY.

- ROLLING MILL / STEEL PLANTS.

- REFRIGERATION AND AIR CONDITIONING.

- THERMAL POWER PLANT COAL HANDLING.

- TEXTILE MACHINERY

- MACHINE TOOLS.

- MINING EQUIPMENTS.

- CEMENT PLANT MACHINERY.

- STEEL PLANT EQUIPMENTS.

 4. EXPLANATION OF FOUNDRY PROCESS

The processing of castings essentially consists of pouring liquid metal into a mould
cavity made of silica sand with necessary binders. The poured castings are cooled in
the mould for sufficiently long time and then the sand is knocked off. The knocked off
sand is re-circulated in the sand plant to process further sand mix. The castings
knocked off are sent to fettling shops for cleaning and finishing to the final
specifications. Necessary heat treatment is given to the castings before final shot
blasting and inspection.

4.1. MELTING

4.1.1. The metal required for castings is melted using an Induction melting unit
which consumes the least power per tonne of liquid metal melted as
compared to other melting units. Induction melting offers clean metal with
least pollution.

4.1.1 The Scrap for melting is weighed and transported to the melting unit electro
magnets or by unloading the bins with scrap using overhead cranes. The
scrap is melted in the melting unit and adjusted for final composition by
addition of ferro alloys.

4.1.2 The temperature of the molten metal is recorded using immersion type
temperature measuring devices. These are superior to optical pyrometers.
The temperature of the metal is very important in casting process since the
variation in temperature can cause several castings defects such as
improper filling, cold shut, misruns whereas castings poured at high
temperature can result in gross shrinkage, cracks or severe burn on or
metal penetration due to over heating of silica sand.
 4.1.3 A small sample of metal is poured into a metallic mould or sand in the form
of a test bar. This is used for quality control check on the metal. The quality
control check includes chemical analysis, physical testing for mechanical
properties such as ultimate tensile strength, yield point, elongation,
reduction in area, impact strength, hardness, bending properties etc. A
micro structure test is also done on the specimen to find out metallurgical
defects or the structure of metal.

4.1.4 The molten metal at the correct temperature and composition is poured into
ladles which are lined with refractories. The ladles are preheated using oil
fired burners to remove all the moisture which would otherwise cause
porosity in the metal. The pre-heating of ladle also assists in reducing the
loss of temperature when metal is tapped into the ladle. Both lip pouring
and bottom pouring ladles are used in pouring practice. The lip pouring
ladles should be necessarily of tea spout design to avoid slag entering into
the castings. While bottom pouring ladles are convenient for larger
castings. The lip pouring ladles offer better control of pouring for small
sized castings. The molten metal after transferring into the ladle is weighed
using a crane weigher. This will assist in pouring metal into the moulds
without the danger of slag entering into the mould.

4.2 SAND PLANT

4.2.1 The poured moulds are knocked off on the vibratory deck, after allowing
sufficient cooling time. The sand passes through different layers or
vibratory grids for separation for lumps and metallic pieces.

4.2.2 The sand is conveyed to the reclamation unit through a vibratory conveyor.
The reclaimed sand is cooled and classified. A dust extraction system is
provided to the reclamation units for separation of fine particles. The
reclaimed sand is delivered to the sand storage silo for subsequent use.
 4.2.3 Two intensive mixers are provided below the sand silo for production of
cores and moulds separately. While the cores are made manually, the
moulds are compacted using rammers.

4.3 CORE SHOP

4.3.1 The cores form the internal features of castings. Cores are subjected to
more severe thermal conditions. Cores are generally made with one or
more of following techniques.

1. Sodium silicate bonded sand.

2. Oil sand.
3. Chemical bonded cold setting resin sand.
4. Thermosetting phenolic resin sand.

4.3.2 Core sand is manufactured using a core sand mixer. The silica sand is
mixed with a binder like sodium silicate or oil mixed thoroughly in batch
type core sand mixer. The sodium silicate is air setting whereas oil sand is
cured by oxidation and polymerization. Generally core shooters are used
for manufacture of phenolic resin boned cores. The properties of the core
sand are vital for manufacture of castings free of defects. The additives
used are weighted accurately using pan balance. The raw-materials used
for core making are also checked as per acceptance standards using
various equipments available in the sand laboratory. The mixed sand is
rammed into core boxes to get desired shape of cores. The cores are
placed in the mould cavity to form internal shapes of castings.
4.4 MOULDING

Moulding is the heart of the foundry process. Wooden or metallic patterns are
manufactured with necessary allowances for shrinkage and machining. The patterns
represent the outside shape of the castings required. The patterns are mounted on
match plates and the match plates are placed on the compaction table. Metallic
moulding frames are placed on the pattern plate guided by metallic pins. Sand from
the hopper is discharged into the mould cavity and the sand is compacted by
ramming. The mould is stripped from the pattern and conveyed to the pouring line
using roller conveyors and transfer cars. In the case of hand moulding, the moulds
are compacted using pneumatic rammers. Electric hoists or overhead cranes are
used for closing the moulds. The closed moulds are clamped rigidly before pouring.
The closed moulds are poured using ladles. The poured moulds are allowed to cool
for sufficiently long time to enable complete solidification. The cooled moulds are
knocked off on the knockout grid. The knocked off sand returns back to the sand
plant for reprocessing and the castings are separated and fed into fettling shops.
The pattern plates used should be vary accurate. They are checked using several
gauges to ensure that the bushes and pins are accurate and does not result in
mismatch on the castings leading to heavy rejections.

4.5 FETTLING

In the fettling shop the castings are detached from unnecessary portions such as
gates, vents, flow offs and feeders. In some cases, the detachment of feeders is
possible by knockout and in some other cases cutting is adopted. For regular
shaped riser contacts, abrasive cut off wheels can be used for detachment. After
removing the risers, runners etc. (called foundry returns), the castings move further
for shot blasting in a hook hanger type shot blasting machine. The castings are
loaded on to the hook and the door is closed.
The double door machine enables further castings to be loaded when the first batch
of castings is being shot blasted. This will ensure high productivity without loss of
time. In the shot blasting machine, a stream of steel shots are accelerated towards
the casting at high velocities through turbine wheels. The high velocity shots clean
the surface of castings by abrasion. The shots then return back to the hoppers
through bucket elevators. The shots are cleaned and the fine dust is exhausted
through the dust collector and precipitated. Shot blasting is inexpensive and fast
method of cleaning castings free of adhering sand and scales. The shot blasted
castings are further processed by using different type of fettling tools such as
pedestal grinders, swing frame grinders, roto and die grinders and chipping
hammers. Any defects found on the castings are rectified if feasible by approved
procedures. However, heavily defective castings which are uneconomical for
rectification or salvaging are rejected and returned to the melting department. The
castings are stress relieved by heat treatment operation if necessary. It is important
to note that some castings require one or more heat treatment operation. It is
important to note that the fettling of steel castings is a time consuming operation
involving several movements of castings from one work station to other. Hence,
substantial amount of material handling equipments such as rails, transfer cars, jib
cranes, EOT cranes, wheel barrows, bins, pallet trucks etc. are very commonly used
in the fettling shops.

4.6 INSPECTION

Castings are checked in the inspection department for visual quality and dimensions
before despatch. Castings which do not conform to specifications and quality are
recycled in the fettling shop for rectification or in many cases totally rejected
castings are sent to the machine shop or to the despatch as the case may be. High
integrity castings are subjected to nondestructive testing such as radiography and
ultrasonic inspection.
4.7 MACHINING

Castings involving subsequent machining are generally machined in the foundries.

This is an important measure of quality control. A skin cut or proof machining
operation on a castings enables the foundry men to expose any defect in the
castings which otherwise would be difficult to identify in the absence of
nondestructive testing methods. This is especially true because castings form
tenacious sound skin during solidification. During the machining, thus exposing sub
surface defects. Several castings require drilling operation when providing cores are
difficult. Milling machines, drilling machines and lathes are very important for
machining of test bars and proof machining of castings.

4.8 AUXILIARY EQUIPMENTS

4.8.1 Every foundry utilizes major inputs such as water, electricity and
compressed air. The compressed air is used both in the moulding machine
and in the fettling shop. While the moulding machine consumes less
compressed air, the pneumatic tools used in the fettling shop consume
more air. The air compressor should have an air reservoir to ensure
delivery of compressed air at uniform pressure. Pollution and safety
equipments are essential in foundry. In sand plant, shot blasting and heat
treatment operations.

4.8.2 An effort has been made to describe the general foundry process.
However, this is not an exhaustive report of the foundry process which
involves many more intricate quality control procedures. Foundry process
involves several variables which require stringent controls to ensure sound
castings. The testing equipments in the physical and chemical laboratory,
sand laboratory and inspection department play vital role in quality control.
 5. CAPACITY OF THE FOUNDRY

The foundry melting shop is equipped with 175 kw, 300 kg induction melting furnace
which can deliver 340 kgs of liquid iron per hour. Considering 20 heats per day and 25
working days in a month, liquid metal capacity will be 150T/M. At 70% yield 105
tonnes of casting can be produced. Considering rejections and wastage, 100T/M of
castings can be despatched.

However when additional crucible of 300 kg is installed, 22 heats per day can be
achieved as one of the crucible is always available during relining of other crucible.
With 29 working days 190T/M of liquid metal can be produced, yielding 130T/M of
despatchable castings. Melting shop will be the limiting factor for production capacity.

Moulding, fettling and other service departments are planned for a capacity of 150T/M
to avoid production bottle necks and delays due to waiting.

The foundry can produce a maximum weight of 220 kgs/pc, which is limited by liquid
metal capacity of crucible and lifting capacity of crane.

The maximum size of single piece casting will be 1000 x 800 x 600mm (apx).

The foundry envisages production of gray cast iron, ductile and alloy cast iron mainly
focusing on steel plants, earth moving and mining equipments. More details are
provided in the “PRODUCTION PROGRAMME”.
 SRI VASAVI TECHNOCAST PVT.LTD

6. PRODUCT MIX AND SALES TURN OVER (1200 T / YR)

Av. Rate / Sales Turnover

S.No. Specification Tonnes / Year
T (Rs.) (Rs.)

1 Ductile Iron 600 58,000 34800000

2 Grey Cast Iron 300 54,000 16,200,000

3 Alloy cast Iron 300 100000 30000000

Total 1200 81000000

Average Rate per tonne for

R
the product mix : 67500
s.

Sales turnover
Turnover Ratio = = 4.72
Capital Investment
 7. PRODUCTION PROGRAMME

MELTING CAPACITY ( 3 shifts of 8 hours each)

175 KW / 300 Kg / 1000 C/S medium frequency induction furnace.

Melting rate for C.Iron : 320 kgs / hour.

Time required for melting 300 kg : 55 mins.

Tap to tap time : 60 mins.
Number of heats in shifts : 20
Maximum liquid metal possibility : 6000 kgs / day.
No. of working days : 25
Liquid metal per month : 150 MTS.
:142.5MTS.(Consider
Liquid metal available for casting
losses)
Casting possibility at overall yield of 70% : 100T / M
Method yield 75%
Process losses 3%
Rejections 2%
Net yield 70%

Note : With additional 300 kg crucible; max. no. of heats / day : 22

Liquid metal /day : 6600
At 70% yield castings / day : 4620
Despatchable casting / month (29 working days) : 138.98 T (max.)
Maximum capacity planning will be 150 T / M

MOULDING CAPACITY
For hand moulding (manual) : 2 Shifts
For machine moulding (semi mechanized) : 1 Shift
PRODUCT MIX CONSIDERED FOR PHASE I

Ductile iron 400/12, 500/7 50% 50 T/M

Alloy cast iron 25% 25 T/ M
Grey cast Iron 25% 25 T/M
100 T/M

Size of average moulding box (assumed) : 800 x 600 x 200 / 200

Approximate sand weight per mould : 250 Kg
Average cast weight per mould (assumed) : 40 kgs.
Maximum weight of single piece casting : 220 kgs
No. of mould required per day : 110 moulds
Add: mould rejections : 120 moulds per day
Approximate number of cores required : 150 - 200 cores per day
Sand to metal ratio :6:1
Total sand mix required per day : 26, 400 kg
Considering 120 moulds as single shift
: 26.4 / 6 = 4.4 T / hr.
operation for moulding and 6 hours of useful
say 5 T / hour.
time;
capacity of intensive mixer (suitable for 150T / M)
Consider 500 kg intensive mixer which can deliver : > 5000 kgs / hour
Capacity of sand plant will be 5T / hr.

Consider core weight as 50% of casting weight : 2200 kgs of cores / day

Considering all cores to be made in single shift (7 hrs utilization) : 366 kgs /hr

Considering final capacity of 150 T / M,

: 500 kgs / hour
core weight 2600 kgs / day

Consider 150 kg capacity core sand mixer, which can deliver 600 kgs per hour (min.)

Considering cooling time for castings : < 8 hours (box turn around)

Maximum number of moulds for 150 T /M production

(6000 kgs / day) at 40 kg are weight : 150 moulds

Number of moulding boxes * required for initial run : 150/2 = 75 pairs

(* some hand moulding are also needed)

Total sand mix used per month : 150 x 5 = 750 T

Sand to be disposed at 5% wastage (due to lumps and dust loss) : 375 T / M

FETTLING CAPACITY ( 2 shift operation)

Maximum production capacity / M : 150 T

Production per day : 6000 kgs

Consider 3 cycle of shot blasting; capacity required for shot blasting : 1800 kgs / day

For two shift operation of 14 hours effective utilization : 18000 / 14 = 1285 kgs / hr
: 214 kgs / batch say 250
Shot blasting machine capacity required (10 mins cycle time)
kgs / batch
: 500 kgs / pc. (including
Maximum weight to be loaded
risers)
:Heat treatment
Heat treatment is considered since the production will include capacity 1000 Kgs/day.
(25T/M)
alloy iron and ductile iron 400 / 12 and 500 / 7

At maximum capacity, fettling shop load per day : 6000 kgs

Approximate number of pieces at 20 kgs / pc : 300 pcs.

Considering 1600 kg ( 80 pcs) as capacity of

: 2 groups required
each fettling
group and 2 shift operation : 1600 kgs / shift / group.

2 Sets of fettling equipments to be planned to work 2 shifts.

Approximate capacity of air compressor : 100 Cfm for fettling only.

Considering air requirement for other utilities and future mechanization

: 200 cfm to be planned.
(such as moulding machine)

LABORATORY AND TESTING

Chemical lab facility with C, Si determination and micro-scope will be required.

Existing facilities to be used for mechanical testing.

PATTERN SHOP :
Activities will be limited to repair, correction and maintenance of patterns. New pattern and mounting of
method to be off loaded.

MACHINE SHOP : will be considered in the future.

 8.1 RAW MATERIALS AND CONSUMABLES

Material cost per Tonne (Rs)

ALLOY SPECIFICATION
S.NO. DESCRIPTION OF COST
GRAY IRON DUCTILE IRON ALLOY C.I.

1 Melting materials 21654 22815 38597

2 Moulding materials 6532 6532 6532

3 Fettling 1649 1735 3179

4 Others 340 435 340

5 Add Rejection & Waste (2%) 603 630 927

Total material cost/T 30778 32147 49575

Material cost for the product mix (Rs)

TOTAL
PRODUCTION/YR
S.NO ALLOY SPECIFICATION COST/T MATERIAL
MTS
COST

1 Gray cast iron 30778 300 9,233,400

2 Ductile iron 32147 600 19,288,200

3 Alloy cast iron 49575 300 14,872,500

Total 1200 43,394,100

Average. Materials cost/T - 36,162

Material cost as %of sales turnover - 50.57%

 8.2. INFRASTRUCTURE, POWER AND UTILITIES

Apart from basic inputs like scrap, pig iron, ferroalloys, silica sand, foundry
chemicals etc, other infrastructure and utilities are required for production of castings.

8.2.1 INFRASTRUCTURE

• Road approach, loading unloading facility, container movement, railway link,

bulk storages areas and enclosed stores etc are required for handing of raw
materials as well as finished products.
• Effective communication system such as telephone, fax, email, internet etc
and state of the art office management equipments.
• Pattern making and machining facilities and maintenance work-shop.
• Proximity to metallurgical laboratory, R&D center, analytical laboratory etc.
• Supporting industries like fabrication shops, packing industries, electrical
workshops etc.
Since the foundry is situated in the industrial estate, all the above supports will
be available.

8.2.2 UTILITIES
Un interrupted electrical power with tolerable voltage fluctuation is essential for
productions of castings. It is estimated that approximately 1800 to 2000 units of
electrical power is required for production of 1000kg of despatchable castings.
This will depend on the product mix, specification and process of manufacture.
More the mechanization more will be the power consumption.

Induction melting consumes maximum power, i.e.700 to 750 KWH per tonne of
casting, followed by operations such as heat treatment, shot blasting, air
compressor etc.
It is decided to have a stand by diesel Genset to generate 380KVA of power
which can be used to run the induction furnace in case of emergency.
8.2.2.1 FUEL OIL
Fuel oil such as L.D.O is generally used for ladle preheating and operation of
heat treatment furnace. LDO is preferred to furnace oil to reduce pollution and
also scaling on castings. Normal consumption of fuel oil is estimated to be 60 to
45 liters per tonne of casting depending on product mix.

8.2.2.2 Water is mainly required for cooling of induction melting coil and cooling of
knocked out sand. Soft water is essential for cooling of internal circuits
which is produced using water softening plants. Heat treatment also
requires large volume of water if quenching process is involved. Apart from
this, water is used for sand mixing, laboratory and testing and for normal
human consumption. It is estimated that 12000 to 15000 liters of water is
consumed per day, which again depends on climatic conditions.

8.2.2.3 Compressed air is required for most of the equipment used in fettling
operations. Automated sand plants require pneumatic air for solenoid value
activation, sand conveying etc. For the technology selected the compressed
air supply can be delivered with a 150cfm compressor.

8.2.2.4 Industrial gases are used in foundry operation. Some example are
- Oxygen for gas cutting / melting.
- Acetylene for gas cutting.
- LPG gas for heating of moulds.
- Argon gas for purging of liquid metal .
- Nitrogen gas for alloying of metal .
- Co2 gas for curing of sodium silicate loaded sand moulds.

Costs of major utilities are considered in the financial analysis

 8.3 PLANT AND MACHINERY

8.3.1 The plant layout shown in annexure 8 gives the details of space allocations for
various activities in the Foundry.

Area in Sq. Mtrs. (Appr.)

Melting shop 225
Moulding shop 300
Core shop 36
Fettling shop 206
Sand plant 140
Electrical Room 60
Laboratory 18
Pattern Storage 72
Compressors & Genset 24
Inspection & dispatch 72
Stores 60
Maintenance room 18
Total 1230 (appx.)

8.3.2 The offices will be located above the stores to get a perspective view of the
shop floor. Office space of 60 sq. Meters will be available.

8.3.3 Provision is made in the plant Layout for increasing the Pattern storage and
general stores space as the foundry grows in size, This is achieved by addition
of 10000mm wide bay.

Adequate capacity will be built up in the sand plant and moulding area to gear
up for production of moulds required for 1800 MTS/year of despatchable
casting production.

This step is taken to avoid any possible bottle necks in moulding operations.
8.3.4 Extension of Main Bay towards the Melting end is also possible. No expansion
is possible towards inspection end. However provision is available for adding
10 metre wide bay as shown in layout.

8.3.5 The height of shed will be planned for accommodating Overhead Cranes of 2T
capacity and for providing good lighting and ventilation. The maximum height
available will be 6000mm below crane girder.

8.3.6 The layout has been planned for streamlined flow of materials. While designing
the Plant and Machinery layout, due attention will be paid to reduce material
handling. Provision will be made for future mechanization of the plant, to
reduce labour and operator fatigue.

8.3.7 The Melting unit planned is 300 kg/ 300 kg batch capacity with two crucibles.
Maximum weight of single piece casting will be about 220kgs.

8.3.8 A set of ladles of various sizes ranging from 50kgs to 350 kgs., will provide
flexibility in pouring operation.

8.3.9 The Moulding shop will be equipped with various types of mixers for production
of moulds and cores to any demanding quality levels. Mechanization of
moulding and sand supply is considered in phase 2. Equipments will be
strategically located to reduce manpower and operator’s fatigue.

8.3.10 The Core Shop will be equipped with the latest generation equipment to
produce high quality cores. This would result in clean internal cavities in
castings, practically avoiding subsequent fettling operations. Core hollowing
and core joining gauges will be organized.
8.3.11 The Fettling shop will be equipped with 1 Tonne capacity dual fired (oil or gas)
ceramic fiber lined Furnace which will have automatic temperature controls,
providing high degree of temperature uniformity, least fuel consumption and
high degree of metallurgical control. The hook hanger double door type Shot
Blasting Machine with pendulum conveyor will provide one of the least cost
method of cleaning castings efficiently. Production and machine utilization is
enhanced by double door provisions.

8.3.12 The Laboratory will be equipped with a full set of quality control equipments
which would ensure process control and ultimate quality of final output.

The quality control facilities and testing equipments provided will be adequate
for production of castings to international quality specifications. Radiographic
facility however must be availed from outside agencies .

8.3.13 A maintenance Machine Shop will be utilized for proof machining of Castings
as a measure of ultimate quality check and finishing of casting to produce
spares and components.

8.3.14 Inspection equipments provided in Pattern Shop ensure good quality of

Patterns and tooling with high dimensional accuracy which is the basic
requirement of production of good quality castings.

8.3.15 Various tools used in fettling operation and the moulding machines require
supply of compressed air at constant pressure. 150 Cfm of compressor air will
be delivered by use of air compressors, provided with 1000 litre air receiver.

The details of various equipments and the prices are indicated in Annexure - 3.
 8.4 MANPOWER REQUIREMENTS

8.4.1 The manpower required for the foundry is presented in the organization chart
(annexure 6). A qualified metallurgist will be the works manager who will head
the team of engineers, staff and workers. The total employment considered is
79 which includes engineers, staff skilled and unskilled workers. The foundry
operation will be generally a single shift except that melting and processing
sections will work for two shifts.

8.4.2 The manpower indicated is minimum and our efforts will be to avoid further
employment by adopting to modernization and improvements in material
handling systems. A slight change in the estimate of manpower is likely since
actual requirements depend on several factors such as:

- Geographical and climatic conditions of the place.

- Qualification, training and competence of the personnel employed.
- Conditions of work place.
- Sociological factors effecting work efficiency.
- Product mix specifications and quality standards which affect
productivity.
- Local labour regulations and attitude to work.
- Any changes in labour policy.

8.4.3 Application engineering & customer service have been identified as important
criteria for growth prospects for the foundry and therefore a separate marketing
assistant is considered with technical background , Who will also carryout
detailed production planning & control and invoicing function. The managing
direction will be directly involved in customer relations.

8.4.4 Absenteeism has been kept in mind when deciding manpower and therefore
alternative will be available in key areas of operation.
8.4.5 The organization chart clearly shows the level and quantity of each category of
staff and workers required for various departments.

8.4.6 Table enclosed shows, desirable qualification and salary structure for each staff
and worker and also the total annual commitment of salaries and wages. The
estimate includes all the benefits/perks provided to employees such as
housing, conveyance, medical care, air-tickets etc.

8.4.7 Table-7 provides activity based manpower plan, indicating quantities required
in each area of foundry operation.

8.4.8 Commitment of salary and wages is the major contributor to expenses of

foundry operation and therefore a profitable operation demands judicious
employment of personnel with clearly defined job responsibilities and
production targets. Key result areas will be defined for each staff. Profitability
improves with more and more mechanization. Productivity per man can be
improved by increasing production by which personnel employed in service
departments could be better utilized. The foundry plans to have a structured
training schedule to enhance capabilities of staff and workers and better
empowerment.
 8.5. ENVIRONMENTAL IMPACT STUDY

POLICY STATEMENT

It is the policy of the management to adopt the most practical and positive approach to
formulate, review, adopt and implement a comprehensive pollution control and safety
programme to comply with the requirements of environmental protection regulations
(EPR) and in the larger interest of ecology and consideration for the society as a
whole.

To achieve the above objectives, the management is committed to put in the best
possible efforts to;

• Appoint a pollution and safety officer responsible for implementation of environment

and safety management system, maintain records, audit and review and improve
the system.

• Prepare a safety and pollution control manual.

• Motivate and train each employee regarding the importance of safety and pollution
control aspects and create facilities for safe working.

• Measure and analyze the waste disposal, dust and fumes periodically to make an
assessment of ‘hazards’ if any and maintain records of all such analysis.

• Offer free access and extend co-operation to authorized representatives of the EPA
( Environmental Protection Agency) and implement recommendation made by such
authority.
OBJECTIVES

The objective of this report is to briefly explain the metal casting process and outline
the major pollution control and safety aspects already considered by the consultants
during the early formulation of this project.

The various sources of pollution are highlighted and the types of wastes are
explained.

The action plan of the management during the project implementation is explained.

Apart from the various steps already taken to reduce fumes, dust and other pollutants
to acceptable levels by selection of suitable process and advanced technology
equipments fitted with pollution control devices; the management will measure and
analyze all the pollutants during the trial production to implement any further steps
required to control pollution based on the first “Environmental impact study” report.
 MAJOR POLLUTANTS IN FOUNDRY OPERATION

S.No. Activity Source Type of pollutants Remarks

Cleaning of patterns Dust

These activities are out
1 Pattern making Circular band saw Noise
sourced.
disc sanders Wood dust

Charging scrap and Avoid dirty, oily and rusted

Fume
ferro alloys scrap. Use selective scrap.
Use fume extraction.
Cover furnace lid.
Melting operation Fume, heat
Use heat protection apron.
2 Melting Use safety glass, man cooler.

Use cover.
Ladle preheating Fume, heat Ensure air fuel ratio. Avoid
incomplete combustion.

Pouring of mould Fume Use blind risers, cover ladle.

Knockout Noise, Silica dust Closed cabin. Dust filter.

Solid lumps dust Disposal bins. Close lid of
3 Sand plant
Sand mixing dust intensive mixer.
Sand delivery dust Enclosed hoppers

Mould core
4 Moulding and core shop None
preparation

Shot blasting Metallic dust Use closed cabin dust filter.

Riser removal None Negligible

Metallic dust Use fettling booth

Grinding
Sparks Use nose mask, safety glass
5 Fettling
Ensure complete combustion.
Heat treatment Fume Check air fuel ratio.
Chimney 10MTS height.

Heat Use man cooler

Chemical analysis
Mechanical testing
6 Inspection and testing None -
Dimensional check
N.D.T

Use canopy, separate room.

7 Compressed air Compressor Noise
prevent air leak
 WASTE DISPOSAL

1. SOURCES OF AIR POLLUTION

S.No Source Type of Fuel Sulpher content Consumption Chimney height

Fume extractor
1 Melting fumes Electric - 175 KW / hr
Chimney 10 MTS height
Fume extractor
2 Ladle preheating L.D.O 2% max 10 Lit / hr
Chimney 10 MTS height
Bag type dust filter
3 Sand plant operation Electric - 20 KW / hr
20mg / Nm3

4 Heat treatment L.D.O 2 % max 20 Lit / hr 10 MT Chimney

Bag filter
5 Shot blasting Electric - 35 KW / hr
20 mg / Nm3

2. SOLID WASTE GENERATION (AT FULL CAPACITY OF 100 T / M)

S.No. Source Nature of waste Qty/day Handling and disposal

1 Melting Slag (metallic oxides) 60 kg / day Slag pot

2 Sand plant Silica dust collected in filter 400 kgs /day 500 kg bins

3 Knock out Sand lumps 800 kgs / day 1000 kg bins

4 Shot blasting Metallic dust 30 kgs / day 500 kg bins

5 Grinding of casting Metallic dust Negligible -

3. LIQUID WASTE GENERATION – NIL

Note : Solid waste will be stored in covered bins and disposed once in a month for land filling in our

own or any other approved site.

 POLLUTION CONTROL MEASURES

Consistent with the policy and objectives, the management is committed to implement
pollution control and safety measures in all areas of foundry operation. Due
consideration is being give to pollution safety and operator comfort during the project
planning stage itself. Some of the action taken are highlighted below and action plan
for pollution control is presented.

1. The shed is designed with adequate height and ridge ventilator for good
ventilation and lighting.

2. Electric induction melting reduces pollution to minimum, compared to

cupola melting.

3. It is considered to use clean and dry scarp free of oil and rust to prevent
pollution.

4. The furnace and ladles will be covered with specially designed lids lined
with ceramic fibres.

5. Furnace will be provided with hood and fume extraction system with
chimney of 10 MTS height.

6. A close loop cooling water system is considered to avoid disposal of water.

Only evaporation loss has to be made up.

7. Sand reclamation system with cabin for knockout and dust extraction
system is considered. The emission from dust filter will be 20mg / Nm 3
(max)

8. Intensive sand mixers are of close lid design reducing dust.

 9. Underground belt conveyor and bucket elevators are planned for future to
avoid dust in sand preparation area.

10. Eco-friendly green sand moulding has been considered in place of chemical
bonded sand.

11. Due to sand reclamation system, the solid waste disposal is reduced to
minimum.

12. L.D.O. will be used for ladle pre-heating and heat treatment in place of
furnace oil. This will generate less fumes and low in sulphur. Solidnoid control
will be provided for burner control to ensure complete combustion.

13. Fettling activities will be carried-out in closed booth to control noise levels
within desirable limits.

14. Air compressor and power generator will be kept in a separate room to
reduce noise levels. A canopy will be provided for compressor.

15. Personal safety equipments such as helmets, shoes, gloves and safety
glasses will be provided to operators working in hazard areas.

In view of several steps taken during project planning, it is expected that the level of
emission of fumes and dust will be well within permissible limits.

After the implementation of the project and trial run measurements will be carried-out
to find the concentration of pollutants and corrective actions will be initiated.
 ACTION PLAN FOR SAFETY AND POLLUTION CONTROL

1. Identify hazardous substances in the foundry

1.1 Analyze the material

1.2 Prepare hazard data sheet
1.3 Examine whether problem exists
1.4 Identify persons affected
1.5 Implement control measures

2. Analyze the fumes from

2.1 Induction melting furnace

2.2 Heat treatment furnace

Establish concentration of pollutants from fumes and impact on ambient air quality
and decide control measures.

3. Analyze dust concentration from

3.1 Sand plant

3.2 Knockout area
3.3 Shot blasting machine

Establish whether problem exists and implement control measures.

4. Analyze solid waste from

4.1 Sand core lumps

4.2 Slag from melting
4.3 Dust concentrate from sand plant
4.4 Metallic dust concentrate from shot blasting.
Establish presence of harmful substances, if any, record, before disposal to
approved sites.

5. Measure noise level in fettling shop and other areas of foundry and provide noise
measures and personnel protectors.

6. Measure heat stress in melting and other areas and provide man-coolers and
other personnel protection devices.

7. Record maintain and update pollution and safety measures.

8. Organize health surveillance for employees.

9. Organize training for safety and pollution control .

10. Prepare safety and pollution control manual.

11. Implement review and improve.

PROJECT SCHEDULE

Project schedule.xls
 9. PROJECT ECONOMICS AND FINANCIAL EVALUATION

9.1 Capital outlay is presented in the enclosed table. Cost of land and building is
estimated as Rs. 63,72,160 in phase I.

Plant and machinery cost of Rs.1,22,67,700 includes Rs.1,00,000 for erection

and commissioning. Separate provision is made for consultancy charges.
Company registration expenses are included in preoperative expenses and
written off over a period of 5 years as can be seen on the profitability
statement.

Total project cost is estimated to be Rs.19240000 with debt-equity ratio of

1.75:1.

9.2 Source of financing :

Promoters contribution : Rs. 70,00,000

Long term loan from financial Institution : Rs. 1,22,50,000 (Rounded off)
(interest 12%, repayment in 7 years)
Working capital loan at 12.5% interest
from bankers : Rs. 1,20,00,000 (Rounded off)

9.3 Working capital calculation are shown in enclosed table.

9.4 Production cost estimations are separately covered as material cost, labour
cost and power cost. Power consumption is estimated as 1200 KWH per tonne.
Administrative and selling expenses are also estimated and shown in
profitability estimation.

9.5 Depreciation is calculated using WDV method and presented in enclosed

table.
9.6 Interest calculation for term loan is calculated based on 6 months of
moratorium period after start of production, 7 years repayment in 28 quarterly
installments (See table 9.6). Rate of interest 12%.

9.7 Taxes are taken at 30% with 10% surcharge on tax.

9.8 Projected profitability is report is enclosed, which is self explanatory. On full

production on gross profit of 25% and net profit of 16.9% is projected.

9.9. Fund flow statement is enclosed indicates smooth cash flow.

 11. RECOMMENDATIONS AND ACTION PLAN

11.1.1 The market analysis for iron Castings has been very encouraging especially in
view of the growing demands for export. There is going to be potential demand
supply gap for quality castings, since most European foundries are likely to
discontinue production of castings due to escalating labour cost.

11.1.2 It is recommended that a foundry should be established keeping in mind,

production of good quality castings economically with least labour content. The
foundry should be mechanized to diskill the operation and reduce labour.

11.1.3 The capacity of the foundry should be limited to the least economic size so that
selective high value orders could be booked and concentration can be diverted
to value added items such as fully machined components.

11.1.4 Emphasis should be laid on development of Management Information System

and Quality Plans, consistent with the needs of the day. Many foundries fail to
deliver goods due to improper systems and poor management of quality. ISO
9002 quality system should be implemented right from the inception of the
foundry.

11.1.5 Latest, cost effective technology should be adopted to gear up the foundry for
export of castings. Mechanization of moulding operation is highly
recommended.

11.1.6 The foundry is located in Industrial area to make use of the infrastructure
available.
11.1.7 The financial analysis for the project has indicated that the project is highly
viable with payback period of …3 years…The foundry will break even at a
production level of…<50%…….

11.1.8 The project cost is kept to the minimum in phase I to ensure lower cost of over
heads and to enable comfortable servicing of finance.

11.1.9 Considering the viability of project it is recommended to implement the project

on a fast track.

11.1.10.The project schedule is presented in 8.6.

BREAK UP OF CAPITAL INVESTMENT

..\BRK.CAP.INVEST.xls
WORKING CAPITAL REQUIREMENTS
W.C REQUIREMENTS.xls
DEPRECIATION
depreciation.xls
INTEREST ON TERM LOAN
Interest calculation.xls
PROFITABILITY STATEMENT
PROFIT.STATE.PRJ.xls
FUND FLOW STATEMENT
fund flow statement.xls
 KEY FINANCIAL INDICATORS
KEY FINANCIAL INDICATORS.xls
BREAK EVEN ANALYSIS
Break even analysis.xls
 RETURN ON INVESTMENT
RETURN ON INVESTMENT..xls
PROJECT FEASIBILITY STUDY
Project feasibility study.xls