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This partticular pre-fe

easibility is re
egarding Pla
astic Jerry Cans.
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The obje
ective of the
e pre-feasibility report is primarily to
t facilitate potential en
ntrepreneurss in
project id
dentification for investment and in o
order to serv
ve his objecctive; the do
ocument covvers
various aspects of the projecct concept development, start-up, marketing
g, finance and
a
ment.
managem

[We can modify the project cap

pacity and prroject cost as
a per your requirement. We can also
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prepare project
p report on any subject as per your require
ement.]

Lucknow O Office: Sidhivin

nayak Building ,
27/1/B, Gokhlley Marg, Lucknow-226001
L 1

Delhi Officce : Multi Discip

plinary Trainin
ng
Centre, Gaandhi Darshan Rajghat,
New Delhi 110002

Email : inffo@[Link]
Contact : ++91 75260003333, 444, 555
 PROJECT AT A GLANCE

1 Name of the Entreprenuer xxxxxxxxxx

2 Constitution (legal Status) xxxxxxxxxx

3 Father / Spouse Name xxxxxxxxxxxx

4 Unit Address : xxxxxxxxxxxxxxxxxxxxxxx

District : xxxxxxx
Pin: xxxxxxx State: xxxxxxxxxx
Mobile xxxxxxx

5 Product and By Product : PLASTIC JERRY CANS

6 Name of the project / business activity proposed : PLASTIC JERRY CANS MAKING UNIT

7 Cost of Project : Rs.32.22 Lakhs

8 Means of Finance
Term Loan Rs.22.5 Lakhs
Own Capital Rs.3.22 Lakhs
Working capital Rs.6.5 Lakhs

9 Debt Service Coverage Ratio : 2.15

10 Pay Back Period : 5 Years

11 Project Implementation Period : 5-6 Months

12 Break Even Point : 54%

13 Employment : 12 Persons

14 Power Requirement : 30.00 HP

15 Major Raw materials : HDPE Resin, Master Colour

16 Estimated Annual Sales Turnover (Max Capacity) : 118.47 Lakhs

17 Detailed Cost of Project & Means of Finance

COST OF PROJECT (Rs. In Lakhs)

Particulars Amount
Land Own/Rented
Plant & Machinery 23.50
Furniture & Fixtures 1.50
Working Capital 7.22
Total 32.22

MEANS OF FINANCE
Particulars Amount
Own Contribution 3.22

Working Capital(Finance) 6.50

Term Loan 22.50

Total 32.22
 PLASTIC JERRY CANS

Introduction: A Jerry can is a container that is used to store liquid. The

Jerry cans have become a perfect storage container as they are available in
different sizes, shapes, and designs. Additionally, Jerry Cans are also available
in several colors which depict different materials being stored. For example,
red color depicts gasoline, yellow is for diesel and blue color donates
kerosene. Plastic gas cans are cheaper, lighter, and less bulky than metal ones,
and more user-friendly. They are constructed from HDPE (Food Grade)
Plastic, so are perfectly safe for storing drinking water. Jerry cans are widely
used for carrying several dangerous goods including chemicals, as well as
diesel and petrol fuels owing to which these cans have to adhere to several
regulations and standards laid down by government organizations across
different countries. This project report explains the manufacturing process for
5Ltr Jerry can having approximate weight of 200gram each. The project cost
may vary with the product variations.

Uses & Market Potential: Based on material, the global jerry can
market has been segmented into plastic and metal. Plastic based jerry can
segment accounts for the largest share in the global jerry can market. Plastic
being a lightweight, durable, corrosion-resistant, and chemically inert
material is widely used for producing jerry cans of various shapes and sizes.
High-density polyethylene is one of the most commonly used plastic material
for manufacturing jerry cans. High-density polyethylene is a comparatively
low-cost material owing to which it is one of the most widely preferred
materials across the packaging industry. In addition, it offers excellent
resistance to most solvents and has a good low-temperature resistance.
Furthermore, it exhibits a strong barrier against moisture. All these
properties, in turn, make it ideal for manufacturing jerry cans. The global Jerry
cans market is expected to witness a CAGR of around 3% during the forecast
period primarily driven by the growth in the chemicals, oil and lubricant
industry. Besides, features associated with jerry cans like the leak proof
quality, moisture resistant factor, and odourless feature further accelerates
the demand for the jerry cans market.

Raw material: Major raw materials are as follows:

1. HDPE Resin
2. Master Colour

Machinery Requirement: Major machines & equipments are as follows:

S No. Description Qty. Amount
1. Blow moulding machine 1 1490000
2. Air compressor 15 HP 1 240000
3. Refrigerator Moisture separator 1 130000
4. Cooling Tower 30 Tonne 1 80000
5. Grinder 1 240000
6. 5 Ltr. Blow mould 1 120000
7. Water Pump 2 HP 1 15000
8 Other equipments & hand tools Ls 35000
Total Amount 2350000
Manufacturing Process: In plastic jerry can manufacturing, HDPE plastic
resin (white or coloured) are used. At first, the raw material is procured from
the local authorized vendor and stored in the inventory. The composition of
pellets is 97-98 % pellets are of pure HDPE. In this HDPE resins, 2-3% resins
of the master colour of the cans are added to impart the necessary colour. The
mixture is rotated at high rpm in the rotary mixer so that it is uniformly
distributed and thoroughly mixed. Profile dies are mounted into the molding
machine as per the desired dimension of the jerry can after approval from the
production team.
In the next step, the barrel heaters are started and brought to the desired
temperature to melt down the thermoplastic pellets. The resins are added into
the hopper of the extruder. From the hopper, these plastic pellets come into
the feed section of the barrel. There is a screw inside the barrel which rotates
about the vertical axis and moves the pellets into the heating section of the
barrel where these plastic pellets melt to a semi-solid state and are ready to
be injected into the mold of the machine.
The molten plastic comes out from extruder at the desired pressure. The
profile extruded is called a parison. In jerry cans, there is a requirement of
a equal concentration of material at the base as compared to the top. The
amount of material is precisely controlled by sensors and controllers.
In the next step, when the parison reaches the blowpipe of Blow Moulding
Machine, the dies of the machine get closed. Compressed air is blown at
desired pressure through the blowpipe. Under air compression, the parison
acquires the desired shape of the die.
After this, the mould dies are cooled using water flow arrangements for the
desired cooling time cycle. The molten plastic solidifies and gets separated.
Excess lines are trimmed off. In the next step, the jerry cans are inspected for
any quality defects. After this, they are packed and dispatched in the required
quantity.

Area: The industrial setup requires space for Inventory, workshop or

manufacturing area, space for power supply utilities and auxiliary like
Generator setup. Also some of the area of building is required for office staff
facilities, documentation, office furniture, etc. Thus, the approximate total area
required for complete industrial setup is 2500 to 3000Sqft.
Power Requirement: The power consumption required to run all the
machinery could be approximated as 30 Hp

Manpower Requirement: There are requirement of skilled machine

operators to run the machine set. Experience quality engineers are required
for desired quality control. Some helpers are also required to transfer the
material from one work station to other. Office staffs are required to maintain
the documentation. The approximate manpower required is 12 including 1
Supervisor, 2 Plant operator, 3 unskilled worker, 2 Helper and 1 Security
guard. 3 Skilled worker including Accountant, Manager and Sales person.

Bank Term Loan: Rate of Interest is assumed to be at 11%

Depreciation: Depreciation has been calculated as per the Provisions of

Income Tax Act, 1961

Approvals & Registration Requirement:

Basic registration required in this project:

 GST Registration
 Udyog Aadhar Registration (Optional)
 Choice of a Brand Name of the product and secure the name with
Trademark if require.
 NOC from State Pollution Control Board
Implementation Schedule:
S No. Activity Time required
1. Acquisition of premises 1-2 Months
2. Procurement & installation of Plant & Machinery 1-2 Months
3. Arrangement of Finance 1.5-2 Months
4. Requirement of required Manpower 1 Month
5. Commercial Trial Runs 1 Month
Total time Required (some activities shall run 5-6 Months
concurrently)

FINANCIALS
PROJECTED BALANCE SHEET

PARTICULARS I II III IV V

SOURCES OF FUND
Capital Account
Opening Balance - 4.61 7.79 11.42 15.44
Add: Additions 3.22 - - - -
Add: Net Profit 4.38 6.68 8.64 11.01 12.21
Less: Drawings 3.00 3.50 5.00 7.00 8.00
Closing Balance 4.61 7.79 11.42 15.44 19.65

CC Limit 6.50 6.50 6.50 6.50 6.50

Term Loan 20.00 15.00 10.00 5.00 -
Sundry Creditors 0.58 0.66 0.70 0.74 0.79

TOTAL : 31.69 29.94 28.62 27.68 26.93

APPLICATION OF FUND

Fixed Assets ( Gross) 25.00 25.00 25.00 25.00 25.00

Gross Dep. 3.68 6.81 9.47 11.75 13.69

Net Fixed Assets 21.33 18.19 15.53 13.25 11.31

Current Assets
Sundry Debtors 3.59 4.26 4.79 5.34 5.92
Stock in Hand 4.46 5.04 5.58 6.14 6.74
Cash and Bank 2.31 2.45 2.73 2.94 2.96

TOTAL : 31.69 29.94 28.62 27.68 26.93

- - - - -
PROJECTED PROFITABILITY STATEMENT

PARTICULARS I II III IV V

A) SALES
Gross Sale 71.82 85.22 95.70 106.79 118.47

Total (A) 71.82 85.22 95.70 106.79 118.47

B) COST OF SALES

Raw Material Consumed 24.99 28.11 29.99 31.86 33.74

Elecricity Expenses 3.20 3.42 3.65 3.88 4.11

Repair & Maintenance 7.18 8.52 9.57 10.68 11.85
Labour & Wages 17.89 19.68 23.62 27.16 31.23
Depreciation 3.68 3.13 2.67 2.27 1.94

Cost of Production 56.94 62.87 69.50 75.86 82.87

Add: Opening Stock /WIP - 3.21 3.63 4.08 4.55

Less: Closing Stock /WIP 3.21 3.63 4.08 4.55 5.05

Cost of Sales (B) 53.72 62.45 69.05 75.38 82.37

C) GROSS PROFIT (A-B) 18.10 22.76 26.65 31.40 36.10

25.20% 26.71% 27.85% 29.41% 30.47%
D) Bank Interest (Term Loan ) 2.44 1.99 1.44 0.89 0.34
ii) Interest On Working Capital 0.72 0.72 0.72 0.72 0.72
E) Salary to Staff 7.69 9.22 11.07 13.28 15.94
F) Selling & Adm Expenses Exp. 2.87 3.41 3.83 4.27 4.74

TOTAL (D+E) 13.71 15.34 17.05 19.16 21.74

H) NET PROFIT 4.38 7.42 9.59 12.24 14.37

6.1% 8.7% 10.0% 11.5% 12.1%
I) Taxation - 0.74 0.96 1.22 2.15

J) PROFIT (After Tax) 4.38 6.68 8.64 11.01 12.21

PROJECTED CASH FLOW STATEMENT

PARTICULARS I II III IV V

SOURCES OF FUND

Own Contribution 3.22 -

Reserve & Surplus 4.38 7.42 9.59 12.24 14.37
Depriciation & Exp. W/off 3.68 3.13 2.67 2.27 1.94
Increase In Cash Credit 6.50
Increase In Term Loan 22.50 - - - -

Increase in Creditors 0.58 0.07 0.04 0.04 0.04

TOTAL : 40.86 10.63 12.31 14.56 16.35

APPLICATION OF FUND

Increase in Fixed Assets 25.00 - - - -

Increase in Stock 4.46 0.58 0.54 0.57 0.59
Increase in Debtors 3.59 0.67 0.52 0.55 0.58
Repayment of Term Loan 2.50 5.00 5.00 5.00 5.00

Taxation - 0.74 0.96 1.22 2.15

Drawings 3.00 3.50 5.00 7.00 8.00
TOTAL : 38.55 10.49 12.02 14.34 16.33

Opening Cash & Bank Balance - 2.31 2.45 2.73 2.94

Add : Surplus 2.31 0.14 0.28 0.21 0.02

Closing Cash & Bank Balance 2.31 2.45 2.73 2.94 2.96
COMPUTATION OF MAKING OF PLASTIC JERRY CANS

Item to be Manufactured Plastic Jerry Cans

Manufacturing Capacity per day 1,000 Pcs

No. of Working Hour 8

No of Working Days per month 25

No. of Working Day per annum 300

Total Production per Annum 3,00,000 Pcs

Total Production per Annum 3,00,000 5 Ltr each pc
PLASTIC
Year Capacity JERRY CANS
Utilisation

I 70% 2,10,000.00

II 75% 2,25,000.00
III 80% 2,40,000.00
IV 85% 2,55,000.00
V 90% 2,70,000.00

COMPUTATION OF RAW MATERIAL

Quantity of Total CostPer
Unit Unit Rate
Item Name Raw Material Annum (100%)
HDPE Resin 45,000.00 Kg 72.00 32,40,000.00
Master Colour 2,200.00 Kg 150.00 3,30,000.00

Total 35,70,000.00

Total Raw material in Rs lacs 35.70

Raw Material Consumed Capacity Amount (Rs.)

Utilisation

I 70% 24.99
II 75% 28.11 5% Increase in Cost
III 80% 29.99 5% Increase in Cost
IV 85% 31.86 5% Increase in Cost
V 90% 33.74 5% Increase in Cost
COMPUTATION OF SALE
Particulars I II III IV V

Op Stock - 10,500.00 11,250.00 12,000.00 12,750.00

Production 2,10,000.00 2,25,000.00 2,40,000.00 2,55,000.00 2,70,000.00

2,10,000.00 2,35,500.00 2,51,250.00 2,67,000.00 2,82,750.00

Less : Closing Stock(15 Days) 10,500.00 11,250.00 12,000.00 12,750.00 13,500.00

Net Sale 1,99,500.00 2,24,250.00 2,39,250.00 2,54,250.00 2,69,250.00

Sale Price per 5 Ltr. can 36.00 38.00 40.00 42.00 44.00

Sale (in Lacs) 71.82 85.22 95.70 106.79 118.47

COMPUTATION OF CLOSING STOCK & WORKING CAPITAL

PARTICULARS I II III IV V

Finished Goods
(15 Days requirement) 3.21 3.63 4.08 4.55 5.05
Raw Material
(15 Days requirement) 1.25 1.41 1.50 1.59 1.69

Closing Stock 4.46 5.04 5.58 6.14 6.74

COMPUTATION OF WORKING CAPITAL REQUIREMENT

Particulars Amount Margin(10%) Net

Amount
Stock in Hand 4.46
Less:
Sundry Creditors 0.58
Paid Stock 3.88 0.39 3.49

Sundry Debtors 3.59 0.36 3.23

Working Capital Requirement 6.72

Margin 0.75

MPBF 6.72
Working Capital Demand 6.50
BREAK UP OF LABOUR

Particulars Wages No of Total

Per Month Employees Salary
Supervisor 28,000.00 1 28,000.00
Plant Operator 22,000.00 2 44,000.00
Unskilled Worker 14,000.00 3 42,000.00
Helper 10,000.00 2 20,000.00
Security Guard 8,000.00 1 8,000.00

1,42,000.00
Add: 5% Fringe Benefit 7,100.00

Total Labour Cost Per Month 1,49,100.00

Total Labour Cost for the year ( In Rs. Lakhs) 9 17.89

BREAK UP OF SALARY

Particulars Salary No of Total

Per Month Employees Salary
Manager 25,000.00 1 25,000.00
Accountant cum store keeper 20,000.00 1 20,000.00

Sales 16,000.00 1 16,000.00

Total Salary Per Month 61,000.00

Add: 5% Fringe Benefit 3,050.00

Total Salary for the month 64,050.00

Total Salary for the year ( In Rs. Lakhs) 3 7.69

COMPUTATION OF DEPRECIATION

Plant &
Description Land Machinery Furniture TOTAL

Rate of Depreciation 15.00% 10.00%

Opening Balance Leased - - -
Addition - 23.50 1.50 25.00
- 23.50 1.50 25.00
- -
TOTAL 23.50 1.50 25.00
Less : Depreciation - 3.53 0.15 3.68

WDV at end of Ist year - 19.98 1.35 21.33

Additions During The Year - - - -
- 19.98 1.35 21.33
Less : Depreciation - 3.00 0.14 3.13

WDV at end of IInd Year - 16.98 1.22 18.19

Additions During The Year - - - -
- 16.98 1.22 18.19
Less : Depreciation - 2.55 0.12 2.67
WDV at end of IIIrd year - 14.43 1.09 15.53
Additions During The Year - - - -
- 14.43 1.09 15.53

Less : Depreciation - 2.16 0.11 2.27

WDV at end of IV year - 12.27 0.98 13.25
Additions During The Year - - - -
- 12.27 0.98 13.25
Less : Depreciation - 1.84 0.10 1.94
WDV at end of Vth year - 10.43 0.89 11.31
 REPAYMENT SCHEDULE OF TERM LOAN 11.0%

Year Particulars Amount Addition Total Interest Repayment Cl Balance

I Opening Balance
Ist Quarter - 22.50 22.50 0.62 - 22.50
Iind Quarter 22.50 - 22.50 0.62 - 22.50
IIIrd Quarter 22.50 - 22.50 0.62 1.25 21.25
Ivth Quarter 21.25 - 21.25 0.58 1.25 20.00
2.44 2.50
II Opening Balance
Ist Quarter 20.00 - 20.00 0.55 1.25 18.75
Iind Quarter 18.75 - 18.75 0.52 1.25 17.50
IIIrd Quarter 17.50 - 17.50 0.48 1.25 16.25

Ivth Quarter 16.25 16.25 0.45 1.25 15.00

1.99 5.00
III Opening Balance
Ist Quarter 15.00 - 15.00 0.41 1.25 13.75

Iind Quarter 13.75 - 13.75 0.38 1.25 12.50

IIIrd Quarter 12.50 - 12.50 0.34 1.25 11.25
Ivth Quarter 11.25 11.25 0.31 1.25 10.00
1.44 5.00
IV Opening Balance
Ist Quarter 10.00 - 10.00 0.28 1.25 8.75
Iind Quarter 8.75 - 8.75 0.24 1.25 7.50

IIIrd Quarter 7.50 - 7.50 0.21 1.25 6.25

Ivth Quarter 6.25 6.25 0.17 1.25 5.00
0.89 5.00
V Opening Balance
Ist Quarter 5.00 - 5.00 0.14 1.25 3.75
Iind Quarter 3.75 - 3.75 0.10 1.25 2.50
IIIrd Quarter 2.50 - 2.50 0.07 1.25 1.25
Ivth Quarter 1.25 1.25 0.03 1.25 -
0.34 5.00

Door to Door Period 60 Months

Moratorium Period 6 Months
Repayment Period 54 Months
CALCULATION OF D.S.C.R

PARTICULARS I II III IV V

CASH ACCRUALS 8.06 9.81 11.30 13.29 14.15

Interest on Term Loan 2.44 1.99 1.44 0.89 0.34

Total 10.50 11.81 12.75 14.18 14.49

REPAYMENT
Repayment of Term Loan 2.50 5.00 5.00 5.00 5.00
Interest on Term Loan 2.44 1.99 1.44 0.89 0.34

Total 4.94 6.99 6.44 5.89 5.34

DEBT SERVICE COVERAGE RATIO 2.12 1.69 1.98 2.41 2.71

AVERAGE D.S.C.R. 2.15

COMPUTATION OF ELECTRICITY
(A) POWER CONNECTION

Total Working Hour per day Hours 8

Electric Load Required HP 30
Load Factor 0.7460
Electricity Charges per unit 7.50
Total Working Days 300
Electricity Charges 4,02,840.00

Add : Minimim Charges (@ 10%)

(B) DG set
No. of Working Days 300 days
No of Working Hours 0.3 Hour per day
Total no of Hour 90
Diesel Consumption per Hour 8
Total Consumption of Diesel 720
Cost of Diesel 65.00 Rs. /Ltr
Total cost of Diesel 0.47
Add : Lube Cost @15% 0.07
Total 0.54

Total cost of Power & Fuel at 100% 4.57

Year Capacity Amount

(in Lacs)

I 70% 3.20
II 75% 3.42
III 80% 3.65
IV 85% 3.88
V 90% 4.11
 DISCLAIMER

The views expressed in this Project Report are advisory in nature. SAMADHAN
assume no financial liability to anyone using the content for any purpose. All the
materials and content contained in Project report is for educational purpose and
reflect the views of the industry which are drawn from various research material
sources from internet, experts, suppliers and various other sources. The actual
cost of the project or industry will have to be taken on case to case basis
considering specific requirement of the project, capacity and type of plant and
other specific factors/cost directly related to the implementation of project. It is
intended for general guidance only and must not be considered a substitute for a
competent legal advice provided by a licensed industry professional. SAMADHAN
hereby disclaims any and all liability to any party for any direct, indirect, implied,
punitive, special, incidental or other consequential damages arising directly or
indirectly from any use of the Project Report Content, which is provided as is, and
without warranties.