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BUSINESS PLAN

ON
SPONGE

By
USHA
VINAYAKA SPONGE Pvt. Ltd

VS(p)
L
OUT LINE OF BUSINESS
PLAN
• Name of the Company
• About the Sponge
• Organization Structure
• Procedure to take the permission
• Production Process
• Location of the plant
• Financial information
NAME OF THE COMPANY
Our company name is
“VINAYAKA SPONGE PRIVATE
LIMITED”
The “VINAYAKA Sponge
private limited” is only concentrate
on SPONGE only. Now a days the
demand for the sponge is more. That
is the main reason to start this
business. The company is aim to
produce the good quality of Sponge
ABOUT THE SPONGE
The product Sponge is main
raw material for are 1) Iron Ore
2) Coal
3) Dolomite Chips
The main supplier of Iron Ore is
“Sri Venkateshwara Mines” and we
also purchase from other.
The material “Coal” is
purchased form the “South Africa”.
The Dolomite Chips is purchased
from the producers of “Andhra
Pradesh”.
And the Sponge is the main
raw material for the steel.
Our main customers are The
Steel Plants of Chennai, Kerala,
Andhra Pradesh, Goa, and other
places.
The project cost include Lands,
Buildings, machinery and set up has
cost almost 30 crores.
Our company is estimated to
recruit 130 employees.
ORGANIZATION
STRUCTURE
Board Of
Directors

General
Manager

Purchase Dept. Production Dept. Sales Dept. Finance

Shift incharge

Engineers

Work Men
PROCEDURE TO TAKE THE
PERMISSION
• First we need to get the permission
of KUM (Karnataka Udyog Mithra)
• And then we need to get the
permission of
Pollution Control Board
Environment Control Board
ENV IRO NM ENT PO LICIE S
ENVIRONMENT POLICIES
• 20 acres of land is must require. In
that ¼ is greenery.
• The plant is ½ km for away from
Highways.
• 1½ km for away from village and
railways.
• 25 km for away from Monuments.
• 5 km for away from Rivers.
• 10 km for away from city.
PRODUCTION
Iron Ore Coal
PROCESS
Dolomite

Feeding into kiln and materials heat up to 11000 C

Cooler
Material cooled at 100-1500 C
[Output is Sponge Iron and unburned coal (dolochar)]

Screening

-5 mm for magnetic +5mm for magnetic


separation seperation
separation

Sponge Iron fines for Dolochar Sponge Iron


product house bin lumps [+5mm]
ABOUT THE MACHINERY
The machinery contains “kiln”
“vibrators” and “air vaccum filters”
And the machinery is occupy the
40mts length and 3mts diameter.
And capacity of machine is 100
tons per day.
The life span of the machinery is
20 year.
OUT PUT
For 100 tons out put we require to
input the raw material of
200 tons of Iron Ore
100 tons of Coal
160 kg of Dolomite
And the out put is 100 tons
Sponge
and 40 tons of Dolochar (waste)
and this Dolochar is used for the
power plants and bricks.
COST OF RAW
MATERIALS
• The Raw Materials are ‘Iron ore’
‘coal’ and ‘Dolomite’
The cost of Iron ore is 1800
per ton,
The cost of coal is 7000 per
ton,
The cost of Dolomite is 800
per ton.
LOCATION OF THE PLANT
• The location of plant is at ALKUNDI,
which is 10km away form Bellary.
• And it is fulfill the all requirement of
environmental policies.
PROJECT COST DETAIL
• The total project cost is estimated
that 30crores.
• Out of 30crores, 9crores is
contributing by partners and
21crores by loan.
• In that 17 crores for machinery
• We need 20 acre of for that we need
that 6 lakhs per acre that 1.2 crores
• And remaining for set up of
machinery, working capital and
ABOUT THE COMPANY
• The “VINAYAKA Sponge Private
Limited” is a partnership firm. It has
6 partners.
• Each partner has invest 1.5 crores
• And the profit sharing ratio is
1:1:1:1:1:1
• And remaining amount is taken loan,
At the interest rate 14%.
ABOUT EXPENDITURES
• The electricity cost will come Rs.300
per ton.
• And monthly salary for the workers
and labours is around the 10lakhs.
• And the transportation charges per
month is 20lakhs.
FINANCIAL INFORMATION
Cost : 200 tons of Iron ore per day
cost of Iron Ore per ton is 1,800
that is 200 1,800 3,60,000/day
100 ton of Coal per day
cost of Coal per ton is 7,000
that is 100 7,000 7,00,000/day
160kgs of Dolomite per day
cost of Dolomite per ton is 800
that is 160kg is 130/day
• The total cost per day is
Iron Ore 3,60,000.00
Coal 7,00,000.00
Dolomite 130.00
10,60,130.00/day
and that is per year is
10,60,130.00 30 12
38,16,46,800.00
REVENUE
• Total production of Sponge Iron per day is
100 tons And Dolachar is 40 tons.
Sponge Iron is 18,000 per ton
that for 100 ton is 100 18,000
Rs.18,00,000/day
Dolachar is Rs. 500 per ton that is
for 40tons is 40 500
Rs.20,000/day
Total revenue is 18,00,000 20,000
18,20,000/day
per year is 18,20, 000 30 12
GROSS PROFIT
Revenue cost
that 65,52,00,000.00
38,16,46,800.00
27,35,53,200.00
Expenditure for the year
Electricity 9,00,000.00 12
1,08,00,000.00
Salary 10,00,000.00 12
1,20,00,000.00
Transportation expenses
20,00,000.00 12
Total Expenditure
Electricity 1,08,00,000.00
Salary 1,20,00,000.00
Transportation expenses
2,40,00,000.00
4,68,00,000.00
interest 1styear installment
3,02,48,033.00
missl expenses
1,00,00,000.00
interest on partners capital 6%
5,40,000.00
NET PROFIT
Gross Profit Expenses
that is 27,35,53,200.00
9,24,48,033.00
Net Profit 18,11,05,167.00
Income Tax 30% 5,43,31,550.00
profit for sharing is 18,65,05,167.00
5,43,31,550.00
12,67,73,617.00/year
PROFIT SHARING
Total Profit 12,67,73,617.00/year
total partners 6
there fore 12,67,73,617.00 6
2,11,28,936.16/year
per month is 2,11,28,936.16
12
17,60,744.68/month
THANK
YOU