GRILLS, RAILINGS, FENCE

1. INTRODUCTION:

Gates, Grills, Fencing are essentially used for defining and defending the
boundaries of premises and ensuring and avoiding unauthorized entry or
trespassing of humans or animals.

Timber or wood was used since ancient times, which has now been replaced by
iron and steel fabrications. The strength of steel. Light weight and compact size
gives better protection, and offers good aesthetic appeal with better designs.

2. PRODUCT & ITS APPLICATION:

Gates, Grills, Fencing are essentially made from steel via fabrication of various
sections, sheets and pipes. These products are a norm for all most all premises to
install to cover area under their ownership. Railings and grills are part of protection
and are also used as structure for most of stairways, people movement
management and to provide natural view of both inside or outside of the covered
areas.

Depending on the location and use, these products are designed with several
geometric patterns and décor. They are made from wood, stone, cast iron, or
metals like mild steel, stainless steel, aluminum, brass, bronze etc.

3. DESIRED QUALIFICATIONS FOR PROMOTER:

A person with ITI, Diploma, graduation or experience in the products.

4. INDUSTRY OUTLOOK/TREND
The grill fences and railings fabrication industry in India comprises various medium
and small companies that manufacture wide range of simple and decorative
ornamental products form mild steel, stainless steel sections tubes and rods, as
also from cast items. The units in this sector compete with offer for various
innovative designs and patterns with lowest costs. The medium and small
companies are located all over India and also take up the general fabrication
services to industries.

Most innovative designers of these items dominate the market and lately the
stainless steel fabricators are coming off age in view of shopping and other
commercial buildings in urban centers. The leading units in unorganized sector
follow proper standards and specification of materials used.

The technology and market trend is of new finishes with bright brass/ copper/
golden color metal and color plating techniques, with/ without engraving and other
decorative designs.

5. MARKET POTENTIAL AND MARKETING ISSUES. IF ANY :

These products are a normal feature for construction industry for new and old
premises. Commercial and domestic buildings use railing and gates/ doors for
indoor for protection and décor and fences for marking the land plots.

The Indian industry is dominated by low technology and very rare technological
innovation is taken up. However, in recent years, the demand of stainless steel
indoor railings and grills is rising. Demand for fence, grill and railing is mostly from
new or redevelopment/ remodeling of housing and commercial buildings. The
improvement in contemporary designs and décor is anticipated to improve demand
significantly due to rapid industrial investments. Factors such as lower wastage
weather and wear resistance coatings, higher productivity and better quality will
lead to wide usage of new products. The segment is projected to witness moderate
growth.
The growth of construction industry with growing population is the main demand
driver. There is very good potential for good design and aesthetic designed
products.

6. RAW MATERIAL REQUIREMENTS:

Structural section, round and square tubes, pipes, rods, flats, of various metal are
required viz mild steel, stainless steel, aluminum extrusions, brass bronze and cast
iron. Other materials are fasteners and consumables like welding materials.

7. MANUFACTURING PROCESS:

The process of manufacture involves operations as below.

 Cutting of material sheets, tubes, pipes, sections as per required dimensions

in shear machine. Certain components like cast iron and steel rods may be
machined.
 Bending twisting and of rods/ pipes and forming of sheets in bending
machine, press brake as per need.
 Welding of sections, pipes and sheets, Drilling and threading of components
 Pickling and surface treatment like phosphating, anodizing, hard chrome
plating etc. to provide surface finish to components. Painting and polishing
of components.
 Assembly of parts with fasteners.
 Inspection and packing for dispatch/ installations.

The entrepreneur should also develop several new aesthetic designs for different
uses in residential as well as commercial premises.

8. MANPOWER REQUIREMENT:
The unit shall require highly skilled service persons. The unit can start from 8
employees initially and increase to 23 or more depending on business volume.
Monthly
Sr. No Type of Employees No of Employees
Salary
Year
Year 2 Year 3 Year 4 Year 5
1
1 Skilled Operators 16000 2 2 3 3 3
2 Semi-Skilled/ Helpers 7000 2 2 3 5 6
3 Supervisor/ Manager 20000 0 0 0 1 1
4 Accounts/ Marketing 15000 1 1 1 1 1
5 Other Staff 7000 0 0 0 1 1

TOTAL 5 5 7 11 12

9. IMPLEMENTATION SCHEDULE:

The unit can be implemented within 3 months from the serious initiation of project
work.
Time Required
Sr No Activities
in Months
1 Acquisition of Premises -
2 Construction (if Applicable) -
Procurement and Installation of Plant and
3 2
Machinery
4 Arrangement of Finance 2
5 Manpower Recruitment and start up 1
Total Time Required (Some Activities run
3
concurrently)

10. COST OF PROJECT:

The unit will require total project cost of Rs 9.04 lakhs as shown below:
Sr No Particulars In Lakhs
1 Land 0.00
2 Building 0.00
3 Plant and Machinery 3.51
4 Fixtures and Electrical Installation 0.50
 Other Assets/ Preliminary and Preoperative
5 0.30
Expenses
6 Margin for working Capital 4.73
TOTAL PROJECT COST 9.04
11. MEANS OF FINANCE:

The project will require promoter to invest about Rs 5.80 lakhs and seek bank loans
of Rs 3.24 lakhs based on 70% loan on fixed assets.

Sr No Particulars In Lakhs

1 Promoters Contribution 5.80

2 Loan Finance 3.24

TOTAL: 9.04

12. WORKING CAPITAL REQUIREMENTS:

Working capital requirements are calculated as below:

Particular Gross Margin Margin Bank

Sr No
s Amount % Amount Finance
1 Inventories 3.79 40 1.51 2.27
Receivable
2 3.06 40 1.22 1.83
s
3 Overheads 0.98 100 0.98 0.00
4 Creditors 2.52 40 1.01 1.51
TOTAL 10.35 4.73 5.62

13. LIST OF MACHINERY REQUIRED:

Quantit
Sr No Particulars UOM Rate Total Value
y
Main Machines/ Equipment
1 Flat / wire Rod twisting machine Nos 1 40000 40000
2 Shearing Machines Nos 3 12000 36000
3 Fly Press Nos 1 20000 20000
4 Manual Press brake Nos 1 40000 40000
 5 Hand Drills and tools Nos 1 20000 20000
6 Pickling and Surface treatment Nos 1 75000 75000
7 Sand Blasting Facility Nos 1 25000 25000
Quantit
Sr No Particulars UOM Rate Total Value
y
8 Spray Painting Facility Nos 1 15000 15000
9 Pipe Bending Machine Nos 1 10000 10000
10 Welding Machine Nos 2 25000 50000
Subtotal: 331000
Tools and Ancillaries
1 Misc. equipment Dies tools etc. LS 1 10000 10000
2 Hand Tools and gauges LS 1 10000 10000
Subtotal: 20000
Fixtures and Elect Installation
Storage and transport bins LS 1 10000 10000
Office Furniture LS 1 5000 5000
Telephones/ Computer LS 1 15000 15000
Electrical Installation LS 1 20000 20000
Subtotal: 50000
Other Assets/ Preliminary and
LS 1 30000 30000
Preoperative Expenses
TOTAL PLANT MACHINERY COST 431000

All the machines and equipment are available from local manufacturers. The
entrepreneur needs to ensure proper selection of product mix and proper type of
machines and tooling to have modern and flexible designs. It may be worthwhile to
look at reconditioned imported machines, dies and tooling. Some of the machinery
and dies and tooling suppliers are listed.

1. Ace Tech Tools Private Limited

New No. 217, Old No. 95, Lake View Road West Mambalam,
Chennai-600033, Tamil Nadu

2. Naugara Exports
6148/6, Guru Nanak Marg,
 Ambala Cantt, Haryana,

3. Swan Machine Tools Private Limited

Krupal ShahMenit House, Kadia Kui,
Relief Road, Ahmedabad – 380001

4. Shalimar Enterprises
Near Bal Bhavan,
Khokhara Maninagar East,
Ahmedabad-380008, Gujarat, India

6. Om Industries
Plot No. 1-A, Pt. Kishori Lal Complex,
Wazirpur Road, Faridabad-121002

14. PROFITABILITY CALCULATIONS:

Sr No Particulars UOM Year Wise estimates

Year Year
Year 2 Year 4 Year 5
1 3
1 Capacity Utilization % 40 50 60 70 80
2 Sales Rs Lakhs 36.67 45.83 55.00 64.16 73.33
Raw Materials & Other Direct
3 Rs Lakhs 30.28 37.85 45.42 52.99 60.56
Inputs
4 Gross Margin Rs. Lakhs 6.39 7.98 9.58 11.17 12.77
5 Overheads Except Interest Rs. Lakhs 5.43 5.43 5.43 5.43 5.43
6 Interest Rs. Lakhs 0.45 0.45 0.45 0.45 0.45
7 Depreciation Rs. Lakhs 0.43 0.43 0.43 0.43 0.43

8 Net Profit Before Tax Rs. Lakhs 0.07 1.66 3.26 4.86 6.45

The basis of profitability calculation:

The Unit will have capacity of 3000 MT per year of fabrication of Grills, Fencing
and Railings of Outdoor as well as indoor application made from Mild steel, cast
products and stainless steel with different designs and sizes. The bulk sale/
distribution sales prices ranges from Rs 35 per Kg for simple MS products to Rs 300
per kg for high end products depending on design and surface finish etc. size and
order volumes. For exclusive items and murals/ sculptures made from castings and/
or Brass, Bronze, SS steel with plating/ metal coating etc. products, the prices
range from 600 per kg to Rs 1200 per kg.

The raw material cost ranges from Rs 30 to 55 per kg for Mild steel and that of
stainless steel, brass, etc. range from Rs 60 to 300 per Kg. The material
requirements are considered with wastage/ scrap etc. of 7 % of finished products.
The unusable scrap is sold at @ Rs 18 ~ 200 per Kg. and the income of same is
added. Energy Costs are considered at Rs 7 per Kwh and fuel cost is considered at
Rs. 65 per liter. The depreciation of plant is taken at 10 % and Interest costs are
taken at 14 -15 % depending on type of industry.

15. BREAK EVEN ANALYSIS

The project can reach break-even capacity at 39.58 % of the installed capacity as
depicted here below:

Sr No Particulars UOM Value

1 Sales at Full Capacity Rs. Lakhs 91.66

2 Variable Costs Rs. Lakhs 75.70

3 Fixed Cost incl. Interest Rs. Lakhs 6.32

% of Inst
4 Break Even Capacity 39.58
Capacity

16. STATUTORY/ GOVERNMENT APPROVALS

The unit shall have to get state industrial unit registration from DIC, IEC Code for
Export and local authority clearance. Depending on structure of finance the
company shall need to register company with registrar of companies. The
registration and approval for factory plan, safety for Fire etc. requirement,
registration as per Labour laws ESI, PF etc. shall be required as per rules and
applicability. Before starting the unit will also need GST registration for
procurement of materials as also for sale of goods.

As such there is no pollution control registration requirements, except installation

of chimney/ blowers for heat treatment furnace / pickling line and ensure safe
environment as per rules of factory safety. Solid waste disposal shall have to meet
the required norms. Entrepreneur may contact State Pollution Control Board where
ever it is applicable.

17. BACKWARD AND FORWARD INTEGRATION

The machines and equipment offer scope for diversification in to producing general
and industrial fabrication activities. The unit can also offer few standard products
for consumer and industrial use by using the spare capacities and machine
capabilities. As such there is not much scope for organic backward or forward
integration.

18. TRAINING CENTERS/COURSES

There are no specific training centers for these products technology. There are
training for dies and tools development run by several centers of excellence viz
Indo German Tool Room at Ahmedabad, Rajkot, Chennai, and CTTC Bhubaneswar
etc. shall be helpful.

The most important scope of learning is in new product design and development
by associating with institutes like NID etc. Entrepreneur may also study the new
product designs, product range, features and specifications of leading Brands /
competitors across the world by scanning the Internet and downloading data. Viz.
North American, Europe, China etc. markets.

Udyamimitra portal ( link : www.udyamimitra.in ) can also be accessed for hand-

holding services viz. application filling / project report preparation, EDP, financial
Training, Skill Development, mentoring etc.

Entrepreneurship program helps to run business successfully is also available from

Institutes like Entrepreneurship Development Institute of India (EDII) and its
affiliates all over India.

Disclaimer:
Only few machine manufacturers are mentioned in the profile, although many
machine manufacturers are available in the market. The addresses given for
machinery manufacturers have been taken from reliable sources, to the best of
knowledge and contacts. However, no responsibility is admitted, in case any
inadvertent error or incorrectness is noticed therein. Further the same have been
given by way of information only and do not carry any recommendation.

Source:- Udyami Mitra/Sidbi