INTODUCTION

MARKET

BASIC & PRESUMPTIONS:

• The basis for calculation of production capacity has been taken on a single shift basis on 75% efficiency,

• The maximum capacity utilization on single shift basis, for 300 days in a year. During the first year and second year of operations, the capacity    utilization is 60% and 80% respectively. The unit is expected to achieve full capacity utilization from the third year onwards,

• The salaries and wages, cost of raw materials, utilities, rent, etc. are based on the prevailing rates in and around Thrissur. These cost factors are    likely to vary with time and location,

• Interest on term loan and working capital has been taken @ 16% on an average. This rate may vary depending upon the policy of financial    institutions/agencies from time to time,

• The cost of machinery and equipments refer to a particular make/model and the prices are approximate,

• The break-even point percentage indicated is of full capacity utilization,

• The project preparation cost, etc. whenever required could be considered under the pre-operative expense,

• The essential machinery and equipments required for the project have been indicated. The unit may also utilize common facilities available at    Electronics Test & Development Centres (ETDC) and Electronic Regional Test Laboratories (ERTLs) set up by state Governments and STQC    Directorate of Department of Information Technology, Ministry of Communication and Information Technology to manufacture products    conforming to Bureau of Indian Standards.

IMPLEMENTATION SCHEDULE:

The major activities in the implementation of the project have been listed and the average time for implementation of the project is estimated at 12 months:

Note: Many of the above activities shall be initiated concurrently,

          When imported equipments are required, the implementation period of the project may vary from 12 months to 15 months,

          Procurement of raw materials commences from the 8th month onwards.

TECHNICAL ASPECTS:

Process:

The incoming raw material and components are tested for required quantity and specifications. The manufacturing process involves Electronics assembly and Electro mechanical hardware assembly. In electronics assembly all the components are shaped, formed and soldered on pre-designed printed circuit boards. The assembled printed circuit boards are tested for desired performance. The electromechanical components such as connectors, sockets switches, LED display are assembled as per the design of the panel of the equipment. Subsequently the electronic assembly and electromechanical assembly are further assembled to form a compact unit and encased in a metallic or plastic cabin. The final product is then calibrated and tested as per relevant design specifications and customer requirements.

Production Capacity per annum:

Pollution Control

Government accords utmost importance to control environmental pollution. The small scale entrepreneurs should have an environmental friendly attitude and adopt pollution control measures by process modification and technology substitution.

India having acceded to the Montreal Protocol in September 1992, the production and use of Ozone Depleting Substances (ODS) like Chlorofluoro Carbon (CFC), Carbon Tetrachloride, Halons and Methyl Chloroform etc. need to be phased out immediately with alternative chemicals/solvents. A notification for detailed rules to regulate ODS phase out under the environment Protection Act, 1986 have been put in place with effect from 19th July, 2000.

The following steps are suggested which may help to control pollution in electronics industry wherever applicable:

In electronic industry fumes and gases are released during hand soldering/wave soldering/dip soldering, which are harmful to people as well as environment and the end products. Alternate technologies may be used to phase out the existing polluting technologies. Numerous new fluxes have been developed containing 2 – 10% solids as opposed to the traditional 15 – 33% solids. Electronic industry uses CFC, Carbon Tetrachloride and Methyl Chloroform for Cleaning of printed circuit boards after assembly to remove flux residues left after soldering, and various kinds of foams for packaging.

Many alternative solvents could replace CFC-113 and Methyl Chloroform in electronics cleaning. Other Chlorinated solvents such as Trichloroethylene, Perchloroethylene and Methylene Chloride have been used as effective cleaners in electronics industry for many years. Other organic solvents such as Ketones and Alcohols are effective in removing both solder fluxes and many polar contaminants.

Energy Conservation

With the growing energy needs and shortage coupled with rising energy cost, a greater thrust in energy efficiency in industrial sector has been given by the Govt. of India since 1980s. The Energy Conservation Act, 2001 has been enacted on 18th August, 2001 which provides for efficient use of energy, its conservation and capacity building of Bureau of Energy Efficiency created under the Act.
The following steps may help for conservation of electrical energy:

1 Adoption of energy conserving technologies, production aids and testing
   facilities.

2 Efficient management of process/manufacturing machineries and systems, QC and testing equipments for yielding maximum Energy Conservation,

3 Optimum use of electrical energy for heating during soldering process can be obtained by using efficient temperature controlled soldering and    disordering stations,

4 Periodical maintenance of motors, compressors, etc.

5 Use of power factor correction capacitors. Proper selection and layout of lighting system; timely switching on-off of the lights; use of compact    fluorescent lamps wherever possible, etc.

FINANCIAL ASPECTS:
Fixed Capital

(i) Land and building

(ii) Machinery & Equipments

WORKING CAPITAL
Recurring expenditure per month
i) Staff & Labour

ii) Raw material / month(for 150 systems)

iii) Utilities / month

iv) Other contingent expenses per month

Total Capital Investment

Financial analysis

Total Turn over per annum

     = Quantity(Numbers) 3,000/-
     = Total turnover @ Rs 3000/- 90,00,000/-

Profit per annum(Before taxes)
     = 17,70,452/-

Net profit ratio
     = Net profit x 100 / Total Turnover
     =20%

Rate of Return
     = Net profit x 100 / Total Capital Investment
     = 78%

Break Even Analysis :
    Fixed Cost per annum

Break Even Point
             = Fixed Cost x 100 / Fixed cost + Profit
             = 36 %

Additional Information:

1 The project may be modified/tailored to suit the individual entrepreneurship qualities/capacity, production programme and also to suit the locational characteristics, wherever applicable,

2 The technology in this sector is undergoing rapid strides of charge and there is a need for regular monitoring of the national and international technology scenario. The unit, may therefore, keep abreast with new technologies in order to keep them in pace with the developments for global competition,

3 Quality today is not only confined to the product or service alone. It also extends to the process and environment in which they are generated. The ISO 9000 defines standards for quality management system and ISO 14001 defines standards for environmental management system for acceptability at international level. The unit may therefore adopt these standards for global competition,

4 The margin money recommended is 25% of the working capital at an average. However the percentage of margin money vary as per bank’s discretion,

NAMES & ADDRESSES OF MACHINE & EQUPIMENT SUPPLIERS