Project report for Flexible packaging / Plastic packaging manufacturing

Introduction

  Flexible packaging is the most economical method to package and is in high demand in many sectors as it preserves and distributes food, beverages, other consumables, pharmaceuticals and other products that need extended shelf life. Multiple benefits like lightweight, small size, less power, easily disposable and a low-carbon footprint on the environment compared to the rigid plastics, have triggered the shift. Studies have proved that flexible packaging requires much less energy at the stage of manufacturing, transportation, and disposal. One truckload of empty flat pouches is equivalent to more than 75 truckloads of empty rigid containers. The requirement of investments, lack of bank credit facilities and a long gestation period have been impeding the adoption of newer technologies. Either way, the flexible packaging has helped to enhance to carry the ability of products and increases their shelf life. In the future, it will further strengthen the entire Packaging Industry and will attract more foreign companies to invest...

Product / Services & process

Flexible packaging production is the product of the firm. Flexible packaging is any package or any part of a package whose shape can be readily changed. The basic processes used to manufacture flexible packaging products, including rotogravure printing, flexographic printing, adhesive lamination, extrusion lamination/coating; and finishing/slitting. These processes are then related to the machines used to practice them, emphasising the basics of machines’ control systems, and options to minimize wasted time and materials between production jobs. Raw materials are also considered, including  Paper, Foils, Polyester Film, printing Ink & adhesive. Guidance is provided on both material selection, and on adding value through enhancement or modification of the materials’ physical features.

Plant & Machinery / Equipments

Rotogravure (roto or gravure for short) is a type of intaglio printing process, which involves engraving the image onto an image carrier. In gravure printing, the image is engraved onto a cylinder because, like offset printing and flexography, it uses a rotary printing press

Lamination Machine - A number of different technologies are available that cover the wide variety of applications in the food and non-food packaging industries. Web lamination is used to improve the barrier properties of the packaging material in order to protect the packaged item and increase its shelf life

Sliting Machine -Roll slitting is a technique heavily used by Converters (industry). The converter industry normally refers to companies who print, coat and laminate materials. A typical converter is a company that produces flexible packaging material for packaging food

Pouch making machine - Pouch making machine for sealing and cutting of pouch in Various sizes

Market potential & Strategy

The Indian Packaging market was valued at 231,542.5 million units in 2017 and is estimated to grow at a CAGR of 9.2% to reach 359,421.9 million units in 2021. Flexible Packaging is the largest packaging type accounting for 159,337.4 million units in 2016, while Rigid Metal is estimated to witness the fastest CAGR of 11.5% during 2016-2021. Strong favorable demographic factors such as increasing disposable income levels, rising consumer awareness and demand for packaged food are expected to drive the growth of the packaging industry in India. Today the key determinants of the packing industry are the shifting consumer trends, lightweight, varied package sizes, barrier properties, the shelf life of the packaged product, ease of recycling and transport cost. In the whole segment, around 45% of the total production of the packaging material goes to Food & Beverages industry. The industry continues to grow rapidly, driven primarily by pharmaceuticals, foods and beverages, and provides opportunities for Wisconsin companies...

PROJECT REPORT

Flexible packaging / Plastic packaging manufacturing

Address

Introduction

  Flexible packaging is the most economical method to package and is in high demand in many sectors as it preserves and distributes food, beverages, other consumables, pharmaceuticals and other products that need extended shelf life. Multiple benefits like lightweight, small size, less power, easily disposable and a low-carbon footprint on the environment compared to the rigid plastics, have triggered the shift. Studies have proved that flexible packaging requires much less energy at the stage of manufacturing, transportation, and disposal. One truckload of empty flat pouches is equivalent to more than 75 truckloads of empty rigid containers. The requirement of investments, lack of bank credit facilities and a long gestation period have been impeding the adoption of newer technologies. Either way, the flexible packaging has helped to enhance to carry the ability of products and increases their shelf life. In the future, it will further strengthen the entire Packaging Industry and will attract more foreign companies to invest. Global key players have recognized the potential and demand in the flexible packaging market and therefore, started to expand to India. Initiatives by the Indian Government like “Make in India” are opportunities for foreign players to export, import and provide the latest technology and innovation. Moreover, by setting up packaging institutes and collaborating with foreign universities, the Government is continuously improving the process of training potential workforce and tries to meet the need of skilled workforce throughout.

Product / Services & process

Flexible packaging production is the product of the firm. Flexible packaging is any package or any part of a package whose shape can be readily changed. The basic processes used to manufacture flexible packaging products, including rotogravure printing, flexographic printing, adhesive lamination, extrusion lamination/coating; and finishing/slitting. These processes are then related to the machines used to practice them, emphasising the basics of machines’ control systems, and options to minimize wasted time and materials between production jobs. Raw materials are also considered, including  Paper, Foils, Polyester Film, printing Ink & adhesive. Guidance is provided on both material selection, and on adding value through enhancement or modification of the materials’ physical features.

Plant & Machinery / Equipments

Rotogravure (roto or gravure for short) is a type of intaglio printing process, which involves engraving the image onto an image carrier. In gravure printing, the image is engraved onto a cylinder because, like offset printing and flexography, it uses a rotary printing press

Lamination Machine - A number of different technologies are available that cover the wide variety of applications in the food and non-food packaging industries. Web lamination is used to improve the barrier properties of the packaging material in order to protect the packaged item and increase its shelf life

Sliting Machine -Roll slitting is a technique heavily used by Converters (industry). The converter industry normally refers to companies who print, coat and laminate materials. A typical converter is a company that produces flexible packaging material for packaging food

Pouch making machine - Pouch making machine for sealing and cutting of pouch in Various sizes

Market potential & Strategy

The Indian Packaging market was valued at 231,542.5 million units in 2017 and is estimated to grow at a CAGR of 9.2% to reach 359,421.9 million units in 2021. Flexible Packaging is the largest packaging type accounting for 159,337.4 million units in 2016, while Rigid Metal is estimated to witness the fastest CAGR of 11.5% during 2016-2021. Strong favorable demographic factors such as increasing disposable income levels, rising consumer awareness and demand for packaged food are expected to drive the growth of the packaging industry in India. Today the key determinants of the packing industry are the shifting consumer trends, lightweight, varied package sizes, barrier properties, the shelf life of the packaged product, ease of recycling and transport cost. In the whole segment, around 45% of the total production of the packaging material goes to Food & Beverages industry. The industry continues to grow rapidly, driven primarily by pharmaceuticals, foods and beverages, and provides opportunities for Wisconsin companies. The rise of the Indian middle class, the growth of organized retail, the rapid growth of exports and India’s e-commerce boom are all fueling industry growth. Thus, adopting better packaging methods, materials and machinery to ensure quality has become very important for Indian businesses.

The Indian packaging industry constitutes about 4 percent of the global packaging industry. The industry is underpenetrated, and thus offers significant business opportunities, since India's per capita packaging consumption is only 10.5 kg per year, as compared to 109 kg in the U.S., 65 kg in Europe, 45 kg in China and 32 kg in Brazil. Manufacturers of packaging machinery and materials in India find demand for their products mostly in the food processing and pharmaceuticals sectors. About 45 percent of the packaging machinery and materials produced is absorbed by the food processing sector alone, 25 percent by the pharmaceuticals sector, and 10 percent each by the personal products, tea and coffee, and industrial products industries. India’s imports of packaging equipment currently stand at over $130 million a year. India’s imports of packaging equipment for food processing are mainly automated machines and systems.

Project at a glance

Name & Address of Unit

Flexible packaging / Plastic packaging manufacturing

Address

Details of unit
Email : youremail@gmail.com
Phone : 0000
Constitution : Proprietership
Total project cost : *******
Fixed Capital : *******
Working Capital : *******
Total Bank loan : *******
Promoter(s) contribution : *******
Term loan : *******
Working capital loan : *******
Name & address of promoter(s)
Name : Your name
Address : Address
Phone : 000000
Designation : Proprietor
E-mail : youremail@gmail.com

Project Feasibility Ratio

Debt Service Coverage Ratio (Average) :1.87
Current ratio (Average) :2.63
Year 1Year 2Year 3Year 4Year 5
Current ratio 1.53 2.06 2.62 3.19 3.76
Quick ratio 1.13 1.56 2.10 2.64 3.18
Interest coverage ratio 3.87 5.55 7.00 9.48 14.71
Debt equity ratio 2.863 2.080 1.528 1.020 0.542
TOL/TNW 3.02 1.45 0.79 0.43 0.21
DSCR 1.65 1.86 1.90 1.94 1.97
Gross profit Sales Percentage % 29.23 % 28.54 % 28.18 % 27.86 % 27.50 %
Net profit Sales Percentage % 10.84 % 10.56 % 11.10 % 11.57 % 11.90 %
BEP in % of installed capacity % 49.90 % 27.12 % 27.12 % 27.12 % 27.12 %
BEP in sales of Rs 2,620,800.00 1,840,695.65 1,972,173.91 2,103,652.17 2,235,130.43
Return On Capital Employed 0.26 0.34 0.34 0.33 0.33

Project Feasibility graph

Revenue v/s Expense Expense Splitup
 
Revenue
 
Expense
Net profit Sales % Quick ratio

Project Cost

Sl. no Item Amount Rs
1 Building *******
2 Packaging machineries *******
3 Electrification *******
4 Preliminary expenses *******
5 Working Capital *******
Total *******

 

Working Capital Computation

Sl. no Item Amount Rs
1 Consumables / stock in hand *******
2 Work in progress *******
3 Finished goods *******
4 Working expense. *******
5 Receivables/Sundry debtors *******
6 Payables *******
7 Total working capital *******
8 Own Contribution *******
9 Working capital loan *******

Annual Sales / Revenue

Sl. no Item Rate Quantity Unit Total Rs
1 Revenue from flexible package sales ******* X 348000 Kilogram *******
Total *******

Total Yearly Expense

Sl. no Item Amount Rs
1 Salary *******
2 Repairs & Maintanance *******
3 Fuel cost *******
4 Electricity *******
5 Office expense & utilities *******
6 Other operating expense *******
7 Purchase *******
8 Wages *******
9 Other expenses *******
Total *******

Application of Fund

Sl. no Item Subsidy % No. Rate Amount Rs
1 Building ******* 1 ******* *******
2 Packaging machineries ******* 1 ******* *******
3 Electrification ******* 1 ******* *******
4 Preliminary expenses ******* 1 ******* *******
Total Investment *******
Total Subsidy *******
Net Investment *******

Means of Finance

Sl. no Item Amount
1 Term Loan *******
2 Working capital Loan *******
3 Total loan *******
4 Term Loan contribution *******
5 Working capital contribution *******

Profitability Statement

Year 1(!*) Year 2 Year 3 Year 4 Year 5
Revenue from operation
Sales ***** ***** ***** ***** *****
Add :
Closing stock 0.00 0.00 0.00 0.00 0.00
Total ***** ***** ***** ***** *****
Less :
Opening stock 0.00 0.00 0.00 0.00 0.00
Stock purchase ***** ***** ***** ***** *****
Salary ***** ***** ***** ***** *****
Repairs and maintenance charges ***** ***** ***** ***** *****
gas ***** ***** ***** ***** *****
ELECTRICITY bill ***** ***** ***** ***** *****
Total ***** ***** ***** ***** *****
Gross profit ***** ***** ***** ***** *****
Less :
Rent ***** ***** ***** ***** *****
Telephone/Postal &internet charge ***** ***** ***** ***** *****
Total ***** 0***** ***** ***** *****
Depreciation ***** ***** ***** ***** *****
Interest on TL ***** ***** ***** ***** *****
Interest on WC ***** ***** ***** ***** *****
Total ***** ***** ***** ***** *****
Profit before tax ***** ***** ***** ***** *****
Income Tax ***** ***** ***** ***** *****
Profit after tax ***** ***** ***** ***** *****

Cash flow statement

Cash Inflow Pre operative period Year 1 Year 2 Year 3 Year 4 Year 5
Capital 0.63 0.00 0.00 0.00 0.00 0.00
Subsidy 0.00 0.00 0.00 0.00 0.00 0.00
Termloan ***** 0.00 0.00 0.00 0.00 0.00
Profit before tax with interest 0.00 ***** ***** ***** ***** *****
Increase in WC loan 0.00 0.00 0.00 0.00 0.00 0.00
Depreciation 0.00 ***** ***** ***** ***** *****
Increase in Current liability 0.00 0.00 0.00 0.00 0.00 0.00
Total Cash Inflow ***** ***** ***** ***** ***** *****
Cash Outflow
Fixed Assets ***** ***** ***** ***** ***** *****
Increase in Current asset 0.00 0.00 0.00 0.00 0.00
Interest on TL 0.00 ***** ***** ***** ***** *****
Interest on WC 0.00 0.00 0.00 0.00 0.00 0.00
Income Tax 0.00 ***** ***** ***** ***** *****
Decrease in Term loan ***** ***** ***** ***** *****
Drawing 0.00 0.00 0.00 0.00 0.00 0.00
Total Cash Outflow ***** ***** ***** ***** ***** *****
Opening balance ***** ***** ***** ***** ***** *****
Net Cashflow 0.00 ***** ***** ***** ***** *****
Closing balance 0.00 ***** ***** ***** ***** *****

Balance sheet

Liability Pre operative period Year 1 Year 2 Year 3 Year 4 Year 5
A. Share holders funds
Capital ***** ***** ***** ***** ***** *****
Reserve & Surplus 0.00 ***** ***** ***** ***** *****
B.Non current Liabilities
Termloan ***** ***** ***** ***** ***** *****
C.Current Liabilities
Working capital loan 0.00 0.00 0.00 0.00 0.00 0.00
Account payable 0.00 0.00 0.00 0.00 0.00
Total Liability ***** ***** ***** ***** ***** *****
Asset
A. Non current Assets
Fixed Assets ***** ***** ***** ***** ***** *****
B. Current Assets
Inventory 0.00 0.00 0.00 0.00 0.00 0.00
Trade receivables 0.00 0.00 0.00 0.00 0.00 0.00
Cash and cash equivalence ***** ***** ***** ***** ***** *****
Total Asset ***** ***** ***** ***** ***** *****

Repayment of Term loan

Year Installment Outstanding at the beginning Principal repayment Interest Amount paid Outstanding at the end
1 1 ***** ***** ***** ***** *****
1 2 ***** ***** ***** ***** *****
1 3 ***** ***** ***** ***** *****
1 4 ***** ***** ***** ***** *****
1 5 ***** ***** ***** ***** *****
| | | | | | |
| | | | | | |
5 56 ***** ***** ***** ***** *****
5 57 ***** ***** ***** ***** *****
5 58 ***** ***** ***** ***** *****
5 59 ***** ***** ***** ***** *****
5 60 ***** ***** ***** ***** *****

Debt Service Coverage Ratio

Particulars Year 1 Year 2 Year 3 Year 4 Year 5
Receipts
a).Net Profit 0.00 0.00 0.00 0.00 0.00
b).Depreciation 0.00 0.00 0.00 0.00 0.30
c).Interest on termloan 0.00 0.00 0.00 0.00 0.00
Total 0.00 0.00 0.00 0.00 0.00
Repayments
a).Loan Principal 0.00 0.00 0.00 0.00 0.00
b).Interest on termloan 0.00 0.00 0.00 0.00 0.00
Total 0.00 0.00 0.00 0.00 0.00
DSCR 0.00 0.00 0.00 0.00 0.00

Depreciation

Particulars Rate Year 1 Year 2 Year 3 Year 4 Year 5
Building 0.00 0.00 0.00 0.00 0.00 0.00
Less Depreciation 0.00 0.00 0.00 0.00 0.00
Written down value 0.00 0.00 0.00 0.00 0.00
Computers/ Printers /Photocopier/Electronic gadget 00 0.00 0.00 0.00 0.00 0.00
Less Depreciation 0.00 0.00 0.00 0.00 0.00
Written down value 0.00 0.00 0.00 0.00 0.00
Furniture & fixtures 00 0.00 0.00 0.00 0.00 0.00
Less Depreciation 0.00 0.00 0.00 0.00 0.00
Written down value 0.00 0.00 0.00 0.00 0.00
Racks & storage/Interior works 00 0.00 0.00 0.00 0.00 0.00
Less Depreciation 0.00 0.00 0.00 0.00 0.00
Written down value 0.00 0.00 0.00 0.00 0.00
new item 00 0.00 0.00 0.00 0.00 0.00
Less Depreciation 0.00 0.00 0.00 0.00 0.00
Written down value 0.00 0.00 0.00 0.00 0.00
new 00 0.00 0.00 0.00 0.00 0.00
Less Depreciation 0.00 0.00 0.00 0.00 0.00
Written down value 0.00 0.00 0.00 0.00 0.00
Air-conditioning 00 0.00 0.00 0.00 0.00 0.00
Less Depreciation 0.00 0.00 0.00 0.00 0.00
Written down value 0.00 0.00 0.00 0.00 0.00
Other investments 00 0.00 0.00 0.00 0.00 0.00
Less Depreciation 0.00 0.00 0.00 0.00 0.00
Written down value 0.00 0.00 0.00 0.00 0.00
Total less depreciation 0.00 0.00 0.00 0.00 0.00
Total written down value 0.00 0.00 0.00 0.00 0.00

Conclusion

The project as a whole describes the scope and viability of the Trading industry and mainly of the financial, technical and its market potential.The project guarantee sufficient fund to repay the loan and also give a good return on capital investment. When analyzing the social- economic impact, this project is able to generate an employment of 5 and above. It will cater the demand of Trading and thus helps the other business entities to increase the production and service which provide service and support to this industry. Thus more cyclic employment and livelihood generation. So in all ways, we can conclude the project is technically and socially viable and commercially sound too.

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