A. INTRODUCTION

U-CLAMPS

The U-Clamp, which is in the shape of U refers to the clamp which is used to

hold together the several layers of leaf springs of an automobile and hold them

on to the axle. In every automobile the leaf springs are held together by the

help of 2 clamps in each set of leaf springs. The function of a clamping device

is that of applying and maintaining sufficient counteracting holding force to

work force to withstand all tooling forces. The U-Clamps are frequently

replaceable item in a vehicle.

B.PRODUCT USES AND SPECIFICATIONS

Leaf springs are the oldest and still frequently used springing system in a

vehicle. Such springs consist a number of steel strips (spring Leaves) which are

stacked one upon another and are held by shackles. The centre of the spring is

hung from the rear axle house by a pair of U-Clamps.

The U-Clamp used to hold spring leaves are made of MS rods of various sizes

depending on the spring assembly. For example, for rear spring clamps of sizes

between 14” and 22” (length) and front spring system 8” and 10” (length) are

used. State Road Transport Corporations prefer EN 19 and EN 8 grade steel for

manufacturing U-Clamps for OE supply.

The U-Clamp is having U shape having threads at various at both ends and is

supplied along with two nuts.

CENTRE BOLT

Centre Bolt is used to fasten the leaf springs together at the centre of the leaf

springs to avoid displacement of the leaves. The centre bolt is normally used

for the axle spring assembly.

I-BOLT

I-Bolt has the same function as the centre bolt but in Leyland Front Suspension

and the like, instead of Centre bolts, I-Bolts are used.

C. MARKET POTENTIAL

With the setting up major automobile projects namely Ford Motors, Hyundai

Motors, Hindustan Motors, Mitsuibishi and with expansion plans of Ashok

Leyland & TAFE, Chennai emerges the Detroit of south East Asia.Tamil Nadu has

always been a fore-runner in the industrial process, both in terms of industrial

output and also terms of encouraging various new large-scale projects. Having

recorded an impressive is growth industry in the post-reform span, it is poised

for further industrial development and expansion. At present the state accounts

for over 11-12% of India’s industrial output. Automobile ancillaries have O.E.

Market and Replacement market for all automobile components.

The products are purchased by original engine and automobile manufacturers

as ancillary components. There is also a large demand from replacement

markets. The demand of automobile and other engines are increasing every

day. There is a large demand for these products in foreign countries also.

C. TECHNICAL ASPECTS

1. Installed Capacity

The installed capacity of the unit is 600 000 Nos U-Clamps,240 000 Nos Centre

Bolts, and 120 000 Nos I-Bolts per annum. This is based on double shift

operations 300 days in a year, 8 hours per shift.

2. Plant and Machinery

The following items of equipment are required.

Machine name Quantity

(Nos.)

Value

(Rs.lakhs)

Diesel Furnace 1 0.90

Power Press (Cutting) 1 2.60

Power Press (Trimming) 1 2.80

Thread Roller 1 4.90

Rollers for Thread Roller 1 1.80

Draw Bench 1 3.30

Straightening Machine 1 2.85

Head Forging Machine 1 3.60

Turning & Chamfering machine 1 5.20

Acid Tankers 2 1.90

Bending Press 1 2.60

Thread Roller 1 1.40

Country Die Head 1 0.70

Facing Adda 1 0.50

Diesel Furnace 1 0.70

Table Grinder 1 0.20

Auto Blackening Machine 1 2.60

Testing instruments 0.20

Total 35.00

3. Manufacturing Process

The unit will be purchasing steel bars of required sizes from other Bright bar

units and reducing the dimension by using the draw benches. The unit will have

all sophisticated machines to manufacture components. After finishing

operations all parts will be packed and dispatched.

Reducing Dimension of bars (Draw Bench)

I

Cutting to near Diameter (Power Press)

I

Thread Rolling (Thread Rolling Machine)

I

Heating (Heating Machine)

I

Bending to shape (Bending Machine)

I

Nut Fitting (Nuts from outside)

I

Painting, finishing and Packing

4. Raw Material

The main raw material required for production of U-Clamps are MS bright

bars or EN-8 or C46 .MS Bright bars of various thicknesses ranging from 12

mm to 25.4 mm can be purchased from bright bar manufacturers. There is no

shortage for these materials. The nuts can be purchased from other

manufacturers.

5. Land & Building

A rented place with 10000 sqft. area is required. The monthly rent is estimated

at Rs.100,000 and also an advance of Rs.10,00,000.

6. Utilities

Power:

The total power requirement of the unit will be 70 HP

Water:

Water is required only for human consumption.

Man power:

Category Nos. Monthly

Salary

Total monthly

Salary

Manager 1 10000 10000

Fore man 1 7000 7000

Asst Fore man 1 6000 6000

Operator 30 6000 180000

Helper 20 4000 80000

Accountant 1 5000 5000

Assistant 3 4000 12000

security 2 4000 8000

-------

308000

Add : Benefits 20% 61600

-------

Total wages per month 369600

-------

Total wages per annum [Rs.lakhs] Rs.44.35 lakhs

7. Implementation Schedule

If financing arrangement is made available the project can be implemented with

in three months period.

8. ASSUMPTIONS

Installed capacity per annum U-Clamps-600 000Nos

Centre Bolts-240 000 Nos

I-Bolts-120 000 Nos

Capacity utilization-Year -1 60%

Year-2 70%

Year-3 80%

Selling price per unit

U-Clamps-Rs.140.00

Centre Bolts-Rs.18.00

I-Bolts-Rs.45.00

Material cost at

100%

Qty(incldg.

wastage)

Rate Value

(Rs.lakhs) U-Clamps

M.S. Bars 1866000Kgs 28/kg 522.48

Nuts 1200000 Rs7.20/Nut 86.40

Sub total 608.88

Centre Bolts

M.S. Bars 75840 Kgs 28/kg 21.24

Nuts 240000 Rs2.00/Nut 4.80

Sub total 26.04

I-Bolts

M.S. Bars 106080 28/kg 29.70

Nuts 120000 Rs10.00/Nut 12.00

Sub total 41.70

LIST OF MACHINERY SUPPLIERS

Machine Tools

1. Quality Machine Tools

New 238, Linghi Chetty Strret

Chennai 600 001

2. Gujrat Machine Tools

New 279, Linghi Chetty Street

Chennai 600 001

3. Premier Machine Tools

New 103, Armenian Street

Chennai 600 001

Consumables and Packing p.a. at 100%

(Rs.lakhs)

Rs.35.82 lakhs

Power and Fuel-100%-Rs lakhs Rs.20.85 lakhs

Wages&salaries-100% Rs.44.35 lakhs

Repairs & Maintenance per month Rs.10000/-

Depreciation Written Down value

Method

General & administration Expenses per month Rs.150000/-

Selling expenses 3% on Sales

Interest on term loan and Working capital

finance

13% p.a

Income tax provision 34% on profit

4. Machine Centre

New 214 linghi chetty Street

Chennai 600 001

Tempering /Heat Treatment Furnaces

1. Pyrotherm Engineers

245/2B Vanagaram Road

Athipet

Chennai-600 058

2. Pyromasters Furnaces Pvt Ltd

A-13 SIDCO Industrial Estate

Villivakkam

Chennai-600 049

3. KSM Laboratory Glass Works

40 NP.Thiru-vi-ka Industrial Estate

Chennai-600 032

4. Thermal Systems

TS-33 TVK Street

Guindy

Chennai_600 032

LIST OF RAW MATERIAL SUPPLIERS

1. Sai Steel Centre

28-A, Mooker Nallamuthu Street

Chennai-600 001

2. Mahavir Indusrial Corporation

New 273, Linghi Chetty Street

Chennai-600 001

3. Bhagawandas Metals ltd

No.54, Sembudoss street

Chennai-600 001

4. Southern Iron and Steel company ltd

No.7, Wallace garden Second Street

Chennai-600 006

5. P.K.Vaduvammal

97, Rasappa Chetty Street

Chennai-600 003

1. COST OF PROJECT

[Rs.lakhs]

Land & Building (Advance) 10.00

Plant & Machinery 40.00

Other Misc. assets 2.00

Pre-Operative expenses 4.00

Margin for WC 12.21 68.21

2. MEANS OF FINANCE

Capital 38.21

Term Loan 30.00

68.21

3. COST OF PRODUCTION & PROFITABILITY STATEMENTS

Years

Installed Capacity (No.)

1 2 3

U Clamps 600000 600000 600000

Centre Bolts 240000 240000 240000

I - Bolts 120000 120000 120000

Utilisation 60% 70% 80%

Production/Sales (No.)

U Clamps

360000

420000

480000

Centre Bolts 144000 168000 192000

I - Bolts 72000 84000 96000

Selling Price/piece (in Rupee)

U Clamps Rs.140 per piece

Centre Bolts Rs.18 per piece

I - Bolts Rs.45 per piece

Sales Value (Rs.lakhs)

U Clamps 504.00 588.00 672.00

Centre Bolts 25.92 30.24 34.56

I - Bolts 32.40 37.80 43.20

Total sales value 562.32 656.04 749.76

Raw Materials U

Clamps

365.33 426.22 487.10

Centre Bolts 15.62 18.23 20.83

I - Bolts 25.02 29.19 33.36

Consumables 22.21 25.91 29.62

Power 12.51 14.60 16.68

Wages & Salaries 44.35 46.57 48.90

Repairs & Maintenance 1.20 1.26 1.32

Depreciation 6.90 5.87 4.08

Cost of Production 493.14 567.85 641.89

Admin, & General expenses 18.00 18.90 19.85

Selling expenses 11.25 13.12 15.00

Interest on Term Loan 3.90 3.41 2.44

Interest on Working Capital 6.40 6.40 6.40

Total 532.69 609.68 685.58

Profit Before Tax 29.63 46.36 64.18

Provision for tax 10.07 15.76 21.82

Profit After Tax 19.56 30.60 42.36

Add: Depreciation 6.90 5.87 4.08

Cash Accruals 26.46 36.47 46.44

4. WORKING CAPITAL:

Months

Consumption

Values % Margin

Amount

Bank

Finance

Raw Materials 0.75 25.37 25% 6.34 19.03

Consumables 1.00 1.85 25% 0.46 1.39

Finished goods 0.25 10.27 25% 2.57 7.70

Debtors 0.50 23.43 10% 2.34 21.09

Expenses 1.00 0.50 100% 0.50 0.00

61.42 12.21 49.21

6. PROFITABILITY RATIOS BASED ON 80% UTILISATION

Profit after Tax 42.36 6%

Sales 749.76

Profit before Interest and Tax

73.02 62%

Total Investment 117.42

Profit after Tax

42.36 111%

Promoters' Capital 38.21

6. BREAK EVEN LEVEL

Fixed Cost (FC): [Rs.lakhs]

Wages & Salaries 48.90

Repairs & Maintenance 1.32

Depreciation 4.08

Admin. & General expenses 19.85

Interest on TL 2.44

76.59

Profit Before Tax (P) 64.18

BEL = FC x 100 76.59

x 80

x 100 FC +P 140.77 100

44% of installed capacity