1. Project Feasibility Report on
Gents Shirts And Trousers
By:
Pankaj Kumar Taywade
MT14IND014
M. Tech.(Industrial Engineering)
2014-15
Mechanical Engineering
VNIT, Nagpur

2. Content
• Introduction
• Raw Material Study
• Demand Study
• Technical Study
• Location Study
• Financial Aspects
• Source of Finance
• Financial Analysis
• Profit Analysis
2

3. Introduction
• Manufacturing of Shirts and Trousers are under
the category of readymade Garment industry.
• Its contribution to industrial production,
employment and export earnings are very
significant.
• This industry provides one of the basic necessities
of life.
3

4. Raw Material Study
• J. A. I. Impex ,Villa Madonna, Mohan Nagar ,
Nagpur - 440 001, Maharashtra
• Sharda Group Of Indian Silk Industries ,No. 12,
Pragatisheel Colony, Opposite Sai Mandir Wardha Road,
Nagpur - 440015, Maharashtra
• Sri Bhagirath Textile Limited
Sarvodaya Cloth Market, Near Hotel Annapurna,
Gandhibagh ,
Nagpur - 440002, Maharashtra
4

5. Demand Study
• Readymade garments are the choice of urban
people. It is also gaining wider acceptance in
semi-urban and rural areas.
• In domestic market and export market, it has
made spectacular progress in the last decade.
This industry is becoming very vibrant and lot of
foreign investment pouring in this industry
because of low risk and high earning nature of
this industry.
5

6. Technical Study
• Procurement of Fabrics :
Dyed/bleach/synthetic/cotton are procured from the
open market as per the demand. The procured
fabrics are inspected to check unevenness in
colour/shade or any other before cutting and if fabric
is found to be defective the it is eliminated.
• Cutting and stitching : Inspected fabrics are cut into
different sizes by the cutting machine and stitching is
carried out for individual portion of the garment by
the skilled workers with the help of over-lock, lock
stitching machines etc.
6

7. Technical Study
• Washing, Checking, Pressing and Packing: All the
garments are put into the washing machine
containing mild detergent and washed for fours
hours in order to remove the dust , dirt and stains
acquired during the manufacturing process. After
washing garments are dried in tumbler dryer.
Final checking is done into order to remove the
defective garment. The individual pieces are
pressed by the steam presses to remove wrinkles
and packed in the carton boxes.
7

8. Technical Study
• Quality Standard:
• Production Capacity(per annum):
S.No. BIS No. Title
1 IS:12675 Garment Quality Guide
2 IS:4039 Readymade Garment Packaging for Export.
3 IS:10194 Garment Guide for Positioning of Labels.
Product Quantity (Pcs.) Value(Rs.)
Gents Shirts 90,000
4,77,00,000Gents Trousers 90,000
8

9. Technical Study
• Motive power required: Total
30 HP is required to run this unit at installed
capacity.
• Pollution Control : This
process of manufacturing does not generate any
pollution.
• Energy Conservation : Maximum care should be
taken while selecting the machinery and other
equipments so as to ensure minimum power
consumption.
9

10. Location Study
• Availability of land :
Rented 2,500 sq. feet land is available in the
industrial region of Warora @ Rs. 450 per Sq.
feet.
• Approach to site :
Good network of Rail and Road transport. Near
the State Highway linking Nagpur - Chandrapur.
• Transportation : Rented vehicles for
transportation and supply are easily available
near the working site.
10

11. Location Study
• Water : Personal
Bore water of land Owner is available for drinking water
and daily needs. Municipal Corporation taps are also
available.
• Power : Electricity is
easily available throughout 24 hrs. MSEB has established
Power sub station in Warora.
• Other facilities : The
amenities like Post office, Banks, Police station, Petrol
Pumps, Canteen, Bus services etc. are available in this area.
11

12. Implementation Schedule
S.No. Activity Period
1 Selection of site/ working shed 1 month
2 Formation of company(Partnership/Ownership) 1 month
3 Preparation of feasibility report 1 month
4 Registration with commissioner of Industries 1 month
5 Arrangement of finance(Term loan & Working capital) 3 months
6 Procurement of machinery and equipment 1 month
7 Plant erection and electrification 6 months
8 Arrangement of raw material including packaging material 1 month
9 Recruitment of manpower 1 month
10 Selection of market channel 1 month
11 Miscellaneous work like power and water connection etc. 2 months
12

13. Financial Aspects
• Land and Building :
Land :
Total Area of 2500 Sq. Feet @ Rs. 450 per Sq. feet.
Building :
Factory shed : 200 Sq. feet.
Store(Raw Materials) : 50 Sq. feet
Store(Finished Goods) : 50 Sq. feet
Total area covered : 300 Sq. feet
Total Cost : Rs 24,000
13

14. Financial Aspects
• Machinery and Equipments :
S.No. Machinery Description Qty.
No.s
Rate (Rs.) Value (Rs)
1 Single Needle Lock Stitch Machine
with motor.
50 23,650 11,82,500
2 6” Power driven cloth cutting
machine
1 50,000 50,000
3 2 Needle Over lock Safety Stitching
Machine with Trimmer
1 50,000 50,000
4 Double Needle Lock Stitch Machine 2 75,000 1,50,000
5 Button Hole making Machine 1 1,45,000 1,45,000
6 Button Stitching Machine 1 75,000 75,000
7 Hot Fusing Press 1 65,000 65,000
14

15. S.No. Machinery Description Qty.
No.s
Rate (Rs.) Value (Rs)
8 Garment Washing Machine 25 Kg
capacity
1 1,45,000 1,45,000
9 Hydro extractor 25 Kg capacity 1 70,000 70,000
10 Tumbler Dryer 25 Kg capacity 1 1,40,000 1,40,000
11 Flat Bed Steam Iron Press with
Vacuum Table
4 75,000 3,00,000
12 Zig Zag Embroidery Machine 1 45,000 45,000
13 Generator Set 30 KVA 1 1,00,000 1,00,000
14 Wash Room Trolleys 4 10,000 40,000
Total 25,57,500
15

16. Financial Aspects
• Other Fixed Assets
• Total fixed capital = Rs. 28,45,000
S.No. Description Cost(Rs.)
1 Erection and installation 2,17,500
2 Office Furniture 40,000
3 Pre-operative expenses 30,000
Total 2,87,500/
16

17. Financial aspects
• Working Capital (per month)
a) Staff and labour (per month)
S.No. Personnel No. Rate(Rs.) Amount(Rs.)
1 Marketing Manager 1 10000 10,000
2 Sales Representative 1 6000 6,000
3 Accounts Officer 1 5000 5,000
4 Clerk/ Store-Keeper 2 3500 7,000
5 Electrician 1 3500 3,500
6 Peon/Watchman 2 3000 6,000
Total 37,500
17

18. Financial Aspects
Production Staff
7 Production Manager 1 10000 10,000
8 Cutting Master 1 8000 8,000
9 Skilled Workers 55 3500 1,92,500
10 Pressman 4 3500 14,000
11 Unskilled Workers 6 3000 18,000
Total 2,42,500
Perquisites @ 20% on the total salary 56,000
Grand Total 3,36,000
18

19. Financial Aspects
b) Raw Material (per month)
S.No. Item Description Qty.Unit Rate(Rs.) Value(Rs.)
1 Cotton Fabric Shirts (Mtrs.) 16500 80 13,20,000
2 Blended Fabric for Trousers(Mtrs.) 10000 150 15,00,000
3 Trims and Embellishments (Nos.) 7500 15 1,12,500
4 Sewing Thread (Mtrs.) 15000 LS 1,23,750
5 Washing Detergents LS 5,000
6 Packing Material (Nos.) 15000 3 45,000
Total 31,06,250
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20. Financial Aspects
c) Utilities (per month)
1) Electricity Rs. 24,000
2) Water charges Rs. 2,000
3) Fuel for Generator Rs. 5,000
Total Rs. 31,000
20

21. Financial Aspects
d) Other Contingent Expense(per month)
S.No. Contingent Expense Amount(Rs.)
1 Rent 24,000
2 Advertisement & Publicity 3,000
3 Postage & Stationery 1,000
4 Repair & Maintenance 2,000
5 Transport/Travelling charges 5,000
6 Telephone Bills 2,000
7 Miscellaneous Expenses 2,000
Total 39,000
21

22. Financial Aspects
e) Total Recurring Expenses (per month)
1) Staff & Labour Rs. 3,36,000
2) Raw Material Rs. 31,06,250
3) Utilities Rs. 31,000
4) Other Contingent Expenses Rs. 39,000
Total Rs. 35,12,250
f) Total working capital for 3 months
= 3 × 35,12,250 = Rs. 1,05,36,750 22

23. Financial Aspects
• Total Capital Investment
1. Machinery & Equipment Rs. 28,45,000
2. Working capital(3 months) Rs. 1,05,36,250
Total Rs. 1,33,81,750
23

24. Source of Finance
• Bank Name – SBI
• Principal Amount – Rs. 1,07,05,400
• Rate of Interest – 14.10 % p.a.
• Loan Tenure – 15 years
24

25. Financial Analysis
1) Cost of Production (p.a.)
S.No. Description Amount(Rs.)
1 Recurring Expenses 4,10,67,000
2 Depreciation on Machinery @ 10% 2,39,250
3 Depreciation on Office Furniture & other fixed
assets @ 20%
8,000
4 Interest on Total Investment @ 16% 20,97,880
Total 4,34,12,130
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26. Financial Analysis
2) Turn Over(p.a.) by sales
3) Profit(per year)
Profit = Turn over – Cost of production
= 4,77,00,000 - 4,34,12,130
= Rs. 42,87,870
Product Qty Rate/Piece(Rs.) Value(Rs.)
Gents Shirts 90000 210 1,89,00,000
Gents Trousers 90000 320 2,88,00,000
Total 4,77,00,000
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27. Financial Analysis
4) Taxation
a) Income tax calculation : Rs. 1,00,000/- deduction under section
80(C) INCOME TAX ACT for capital repayment. Taxable Income: Rs.
42,87,870 - Rs. 1,00,000 = Rs. 41,87,870
b) Income above the Rs. 10,00,000 : Taxation rate = Rs. 30000 + 30
% of Amount Exceeding Rs. 10,00,000
c) Amount Exceeding Rs. 10,00,000 : Rs. 31,87,870
d)Tax Amount : 30 % × 3187870 = Rs. 9,56,361
e) Education Cess : 3 % of Income tax = Rs. 28690.83
f) Total Tax Payable : Rs. 10,15,051.83
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28. Financial Analysis
• Net Profit
= Total Profit – Tax Amount
= Rs. 42,87,870 - Rs. 10,15,051.83
= Rs. 32,72,818.17
28

29. Profit Analysis
• Profit on sales
• Rate Of Return on Total Capital Investment
ROR = (Total net profit / Total capital Investment) × 100
= (3272818.17 / 13381750) × 100
= 24.45 %
% Profit = (Total net Profit / Total Turn over) × 100
= (3272818.17 / 47700000) × 100
= 6.86 %
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30. Name & Address of the Machinery &
Equipment Supplier
• Paras Special Machine Co.,
Madhopur Kucha No. 7,
Rohan Road, Ludhiana.
• Mehala Machines India Limited,
C-62, Okhla Industrial Area, Phase-1,
New Delhi-110020.
• Vijay Sewing (P) Ltd.,
17-D, Everest House, 46-C,
Chowringhee Road, Kolkata.
• Apparel & Leather Techniques Pvt. Ltd.,
Kaikondanahalli, Near Bellaandur Gate,
Bangalore-560035. 30

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