MSME-DI, KANPUR.

PROJECT PROFILE
ON
ALKYD RESIN

PRODUCT : ALKYD RESIN .

PRODUCT CODE : .

QUALITY & STANDARDS : As per Customer’s specification &

PRODUCTION CAPACITY (P.M.) : Quantity : 1500 M. T.

Value (Rs.) : 1800 Lakhs

MONTH & YEAR OF PREPARATION : February, 2012.

PREPARED BY : MSME - Development Institute,

Ministry of Micro, Small & Medium Enterprises,
Government of India
107, Industrial Estate, Kalpi Road,
Kanpur-208012.
Tele. 2295070, 2295071 & 2295073 (EPBAX)
Tele. No. 2295072 (SENET & TRC)
Tele/Fax No.: 0512- 2240143
Email: [email protected]
Website: msmedikanpur.gov.in
 MSME-DI, KANPUR.
1

PROJECT PROFILE
ON
ALKYD RESIN

1. INTRODUCTION

Alkyd resins are any of a large group of thermoset resins that are essentially
Polyesters made by heating polyhydric alcohol with polybasic acids or their
anhydride and used chiefly in making protective coatings with good weathering
properties.

These resins are useful as film forming agents in paint, varnished and enamels &
as thermosetting plastics that can be moulded into solid objects. Hence, alkyd
resins are one of the important ingredients in the synthetic paint industry.

The paint factories in India currently produce a variety of paint which can broadly be
categorized as synthetic enamel. This type of paint is used for the exclusive use in
internal / exterior walls and ceilings of architecture. This type consists of alkyd
based products which are used as metallic & wood paints, varnishes & lacquers,
antirust, etc.

2. MARKET POTENTIAL:

Alkyd resin, which is used in the production of a wide variety of paints, is supplied to
the Indian market both from domestic production and import. As Indian industries
are producing paint of amount approximately Rs.15000 crores which needs Alkyd
Resin of amount near about Rs. 3000 crores.

Due to construction of apartments, buildings, roads there is huge demand of paint in

this sector. Increased demand of paint will need the basic raw material of paint i.e.
alkyd resin simultaneously.
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3. BASIS AND PRESUMPTIONS:

1. The unit will run on three shifts basis of 8 hours per shift for 300 days per year.
2. The unit will run at 80% capacity utilization.
3. The cost of land & building, plant & machinery, raw materials & finished goods
are as per prevailing market rate.
4. The name and addresses of plant & machinery of raw material suppliers are
neither exclusive nor exhaustive.

4. IMPLEMENTATION SCHEDULE :

Every project requires some specific time for commercial production and are briefly
as under:-

Sl. Activity Expected time

No.
Acquisition of land 1 month
Filing of EM-I. 7 days
Building construction 3 months
Financial Arrangements 2 months
Procurement of Machinery 3-5 months
Installation, electrification and commissioning of 1-3 months
machinery and other facilities
NOC from Pollution Control Board 1- 2 months
Trial run From 9 months
onwards
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5. TECHNICAL ASPECTS

i) Production detail & Process of Manufacture:

Two processes are used for the production of alkyd resins, namely the solvent
and the fusion process. The solvent process uses a small amount of solvent, 5-
10%, in the esterification reaction to act as a reflux medium. The advantages of
this process are:

Uniformity of product
Increased speed of reaction and
Lower material losses.
Light colour

In the solvent process, the production of alkyds can be carried out either in a
single stage or a two stage process. Under the single stage process, the drying
oil (linseed oil), polyalcohol and phthalic anhydride are converted simultaneously.
This method of alkyd preparation is not satisfactory because of the
incompatibility of the phthalic anhydride with drying oil (linseed oil) and the
difficulty of controlling the reaction to produce the desired end-products.

In the first stage of the two stage solvent process, monoglyceride is produced
from drying oil and polyalcohol and in the second stage the monoglyceride is
esterified with phthalic anhydride to convert it into alkyd resin. This process is
more satisfactory and is the one recommended for the envisaged plant because
it eliminates the problems of the first option.

In the two- stage solvent process, the first operation is the alcholoysis reaction
which takes place under different duration of time (varying form 40 minutes to 4
hours) and temperature (from about 240 to 260oC). The completion of this stage
is shown by the solubility of the product in about twice its weight of methanol

ii) Quality Control & Specification:

Monoglyceride formation is checked by solubility method with methanol in the

ratio 1:3. The confirmation test is done by compatibility test in which
monoglyceride is heated separately in small quantity with pthalic anhydride and
heated up to 225 degree Celsius. The reaction product is diluted with MTO to
infinite.
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iii) Production Capacity ( per annum )

a) Quantity : 1500 MT
b) Value (Rs.) : Rs. 1800 Lakhs

iv) Motive Power Requirement:

30 KW

6. FINANCIAL ASPECTS:

(A) Fixed Capital:

i) Land and Building :

Land – 1000 Sq. Mtrs. @ Rs.1500/- per Sq. Mtrs. Rs. 15,00,000/-
Built up Area – 400 Sq. Mtrs. @ Rs.5000/- per Sq. Mtr. Rs. 20,00,000/-
Total: Rs. 35,00,000/-

ii) Plant & Machinery:

Sl. Description Qty Value (Rs.)

No. (Nos.)
1 7,50,000/-
Reactor 1 unit
2 2,00,000/-
Condenser (main) 1
3 75,000/-
Separator 1
4 75,000/-
Blender 1
5 75,000/-
Vent condenser 1
6 75,000/-
Addition Tank 1
7 25,000/-
Resin pump (Reactor to blender) 1
8 25,000/-
Resin pump (Blender to filter) 1
9 75,000/-
Resin filter (Sparkler) 1
10 2,25,000/-
Stand by elect. Generator 1
11 2,75,000/-
Thermic fluid heating system (heat therm) 1
12 25,000/-
Oil pump 1
13 15,000/-
Weighing scale 1
14 50,000/-
Finished product tank 1
 MSME-DI, KANPUR.
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15 1,00,000/-
Water Hydrant 1
16 50,000/-
Fire Extinguisher (Foam type) 4
17 3,00,000/-
Cooling tower & pump 1
18 50,000/-
Laboratory equipment -
19 50,000/-
Miscellaneous items -
20 2,00,000/-
Installation of plant & machinery @ 10% -
27,15,000/-
Total:

Total Fixed Capital Requirement:

1. Land & Building 35,00,000/-

2. Plant & Machinery 27,15,000/-
Total: 62,15,000/-

(B) Working Capital (Per Month):

i) Staff and Labour ( per month)

Sl. No. Designation No. Rate Amount

(Rs.) (Rs.)
1 20,000/-
General manager 1 20000/-
2 Sales officer 2 15000/- 30,000/-
3 5,000/-
Accountant 1 5000/-
4 20,000/-
Production and technical head 1 20000/-
5 3 15,000/-
Operators 5000/-
6 4000/- 16,000/-
Skilled Workers 4
7 3500/- 14,000/-
Unskilled Workers 4
8 Laboratory Technician 1 4000/- 4,000/-
9 10,500/-
Guards 3 3500/-
Total 1,34,500/-
Perquisites @ 15% of salary 20,175/-
Total 1,54,675/-
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ii) Raw Material:

Sl. No. Particulars Quantity Rate Value (Rs.)

Kg (Rs)
1 Linseed oil 74250 90/Kg 66,82,500/-
2 Penta Erythriol 18550 120/Kg 22,26,000/-
3. Pthalic anhydride 33500 102/Kg 34,17,000/-
4. Litharge 25 150/Kg 3,750/-
5. Xylene 1250 88/Kg 1,10,000/-
6. Barrel (200 Ltrs cap.) 625 500/Pc 12,500/-
Total 1,24,51,750/-

iii) Utilities:

Sl. No. Particulars Quantity Rate Value (Rs.)

1 Electricity & Power 2500 units Rs. 9.00/unit 2,25,000/-
2 Fuel (Diesel) 5000 Ltrs. Rs.43/ Ltr 2,15,000/-
Total 4,40,000/-

iv) Other Contingent Expenses:

Sl. No. Description Amount in Rs.

1. Telephone and stationery : 5,000/-
2. Travelling & Transport : 10,000/-
3. Repair & Maintenance : 10,000/-
4. Insurance : 15,000/-
5. Other expenditure : 10,000/-
Total : 50,000/-

v) Total Recurring Expenses (per month)

a. Salary & Wages : 1,54,675/-
b. Raw material : 1,24,51,750/-
c. Utilities : 4,40,000/-
d. Other contingent expenses : 50,000/-
Total: : 1,30,96,425/-

Total Working Capital for 3 months = 1,30,96,425/- X 3 = : Rs.3,92,89,275/-

Say = Rs. 3,93,00,000/-
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7. Total Capital Investment:

a) Fixed Capital 62,15,000/-

b) Working Capital for 3 months 3,93,00,000/-
Total: 4,55,15,000/-
Means of Finance:

i) Promoter’s share 25% 1,13,78,750/-

ii) Loan from Financial Institution 75% 3,41,36,250/-
Total: 4,55,15,000/-

8. Financial Analysis:

(A) Cost of production (Recurring Expenses) ( per annum )

S. No. Particulars Amount (Rs.)

1. Total Recurring Expenditure 15,71,57,100/-
2. Depreciation on Building @ 5% 1,35,000/-
3. Depreciation on Machinery & Equipments @ 10% 2,00,000/-
(Except Electrification & Installation, Trial run)
4. Interest on 75% on loan @ 14% p.a. 47,79,075/-
Total : 16,22,71,175/-

(B) Turnover (per annum)

Sales proceeds as shown below:

Item Quantity (M.T.) Rate (Rs.) Value (Rs.)

ALKYD RESIN 1500 MT Rs. 120/Kg 18,00,00,000/-

(C) Net Profit (Per Annum):

Turn Over (-) Cost of Production

Rs. 1,77,28,825/-
18,00,00,000/- (-) 16,22,71,175/-

(D) Net Profit Ratio (Per Annum):

Profit/annum X 100 1,77,28,825/-X 100

= 9.84%
Sales Per Annum 18,00,00,000/-

(E) Rate of Return:

Profit/Annum X 100 1,77,28,825/-X 100

= 38.95%
Total Capital Investment 4,55,15,000/-
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(F) BREAK EVEN POINT:

Fixed Cost (Per Annum):

1. Depreciation on Building @ 5% p.a. 1,35,000/-

2. Depreciation on Plant & Machinery @ 10% p.a. 2,00,000/-
3. Interest on loan @ 14% p.a. 47,79,075/-
4. 40% salary and wages 7,42,440/-
5. 40% of Utilities 21,12,000/-
6. 40% of other expenses 2,40,000/-
Total Fixed Cost: 82,08,515/-

Break Even Point:

Fixed Cost X 100 82,08,515/- X 100
= 31.6%
Fixed Cost + Profit 82,08,515/- + 1,77,28,825/-

9. Names and Addresses of Plant & Machinery Suppliers:

1. M/s Suresh Engg. Works,

Shukla Industrial Shed, Mahadeo Seth Compound, Mahim Road,
Pal Ghar – 401404. (Maharashtra)
Phone: 0252 – 254793 Mob 9890222944
2. M/s Prakash Industries,
D-3, Shital Industrial Estate, Behind Tirupati Gas Gowdown,
Meera Bhayandar Pathak Road, Bhayadar East, Thane – 401105 (Maharashtra)
Phone: 9820449039
3. M/s Doshi Engg. Works,
Mogra Village Road, Next to Reliance Consultancy,
Opp. Stadard Metal Compound, Andheri East, Mumbai – 400069. (Maharashtra).
Mob. 9323299589.
4. M/s Universal Engg. System,
16, KK Gupta Indl. Estate, Opp. Jawahar Taalkies, Dr. R. P. Road,
Mulund West Mumbai – 400080.
Mob. 9892760940

10. Names & Addresses of Raw Material Suppliers:

Raw material can be purchased from local market.

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*PSB*FEB*2011*