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Terry Towel

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Introduction: 

There is a steadily  growing  demand of Terry Towels in the domestic, retail and export markets and  such demand is driven by  desire  for better and hygiene based lifestyle.  The  various  Indian  Towel units are performing profitably with increasing market share.

A  terry  Towel project based on  16  nos. Terry Towel looms of high speed  Airjet  type [ to be  sourced  second hand in good condition] is  proposed  with best quality new Indeg. fabric  dyeing/drying plants. The project has been conceived as an  export-focussed  unit, under the concessional 5% duty  EPCG scheme. The unit is proposed to have an installed capacity of 16 x 200kg, i.e 3200 Kg/Day  of  finished  Towel at  max. achievable capacity of 85%.

Since the unit would be primarily catering to the international markets, the unit would be utilizing the 'second hand' towel weaving  air jet looms from world renowned suppliers.  The width proposed for  towel looms will be  280 cm  and  340 cm considering the market needs. Also, 50%  of  such towels  looms will be equipped with 'Dobby' design device. This has been considered in order to give the unit a flexibility of manufacturing the complete range of toweling fabrics, which includes besides towels, towels for  Gyms and clubs and bath-robes etc. 

Plant & Machinery:

The cost of imported 'second hand'  Airjet type looms will  be about Rs. 335 lacs. The  towel looms will be  supported  and balanced  by pre-weaving, fabric  dyeing  and drying plants of  best Indigenous make from Indian suppliers. The  cost  for indigenous production plants, as above, along with the supporting  Plant utilities like the Boiler, Humidification, Air compressor, and  Design Lab. and basic ETP plant is estimated at approx. 300 lacs. The plant has been envisaged to be eco-friendly and proposes to set up a useful basic effluent treatment plant, which has been incorporated as an integral part of the project. 

The  project would  require 4 acres of land, of value approx. Rs50 lacs and the  built up area of upto 1 acre that is 4000 sq. meters.

Raw materials & consumables:

The unit would be sourcing its requirement of raw material in the form of cotton 'carded' yarn of counts 13’s, 16’s,  2/20’s, 2/24’s indigenously, which are available from Spg. mills in the north.  Based on a process loss of  about 15% the unit would be consuming a total of 3.7 tonnes of cotton yarn per day at max capacity utilization. Varieties of consumable materials like  Dyes  & chemicals, pile yarn, processing chemicals and packaging materials would be required.

Cost of the project:

Sl.
No.

Description

Cost (Rs. in lacs)

1.

Land & Site Development

50.00

2.

Buildings

240.00

3.

Plant & Machinery

 

 

Imported

335.00

 

Indigenous

300.00

4.

Misc. Fixed Assets

50.00

5.

Contingency & Pre-operative exp. @ 5%

50.00

6.

Margin money for WC

50.00

 

Total

1075.00

 

say,

10.75 crore

Means of Finance:  

Promoters      375.00 lacs  
Central Financial Institutions (term loans)   700.00 lacs  

Manpower:

The project would be employing a total of 145 persons including 30 supervisory/technicians and 100 factory workers in three shift working.  The rest will be management staff

Utilities:

The unit would require an installed load of 562 KVA.  The total electricity requirement is planned to be approx. 11,000 units per month.  One captive DG sets is proposed for contingency needs.

The unit would also be requiring a steam generation facility which would consist of 2 ton per hour multi-fuel type fired boiler for 7kg/cm2.

The total water consumption by the unit is proposed to be met by 1 borewell of 6” dia.

Production & sales:

With an installed capacity of 1120 TPA of toweling fabric on 350  working days  per year; the unit is estimated to achieve 65%, 80% & 90% capacity utilization in the 1st, 2nd & 3rd year of  operations. Based on average  Selling value of  Rs 260/Kg, the unit is expected to achieve a total sales income of Rs. 2330 lacs by the 2nd year. The project would  thus deliver a Turnover to invest. of more than 2 to 1.

The airjet type  terry looms would ensure minimum defects.  The fresh grade is estimated to constitute 95% of the total production, second grade at 4% and the balance 2% of rejects.  A selling price of Rs.260/-  for the  1st  quality saleable grade for exports is assumed.

Recommendations: The  project  is a  technically  and  economically  Viable venture  based on 16 nos. highspeed  airjet  towels looms in wide  width   and  despite  being of  second hand level. The  project  will be able to  deliver Gross profit of 20-22% on the  sales; and enable the  repayment of term loans [at 12% interest] over 1+7 years. The  project is  recommended  for quick implementation over  8-10 months  and preferably in a location with adequate  Water availability.

(Note: Plants of other capacities are also possible. Please write to vpcs@unlimitedprojects.com for Project Report on this or similar projects)