INVESTMENT CASTING

PRODUCT CODE

: NA

QUALITY AND STANDARDS

: As per ISI specification

PRODUCTION CAPACITY
Value

: 810 MT
: Rs. 7, 71,56,000/-

MONTH AND YEAR

OF PREPARATION

: June, 2014

PREPARED BY

: Dr. Amarnath
Assistant Director (Metallurgy)

1. INTRODUCTION
Investment Casting is a metal casting process which employs an expendable
pattern and one piece nonmetallic mould. This process is also known as Precision
Casting because it eliminates the parting line and reduces the machining cost.
Sometimes, this process is also known as lost wax method. Although all metals,
namely ferrous as well as non-ferrous can be casted by this process, it is most
suitable for expensive, hard and high strength metals and alloys, which are difficult
to machine. This also includes Stainless and Tool Steels. Steel, in general, finds
extensive application in each and every sphere of life ranging from domestic use to
industrial use. In this project, the casting has been worked out on the basis of
Stainless Steel Scrap, which finds tremendous application in Chemical,
Pharmaceutical, Dairy, Power Generation and Aircraft Industries such as Screws,
Fuel Lines, Engine Parts, Heat Exchangers, Turbine Buckets and Valves. Most of it
conforms to austenitic, ferritic and martensitic grade followed by Heat Treatment.

2. MARKET POTENTIAL
The units engaged in the manufacturing of Chemical, Pharmaceutical, Power
Generation, Aircraft Industries and Dairy Equipment require a number of special
castings such as Stainless Steel Castings in different sizes and shapes. In addition,
the requirement of tool steels has gone on increasing with the pace of industrial
development. The numbers of units engaged in the Steel Castings by Investment
process are negligible. A few which are producing their castings by conventional
type of casting process are not of the standards and specifications with respect to
chemical composition of steel. In view of the above, there is immense scope for
setting up of such units in the Small Scale Sector with induction melting and quality
control facilities due to latest industrial policy declared by the Government, so as to
cater to the needs of various industries established in the country and overseas.
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Investment Casting

3. BASIS AND PRESUMPTIONS

This project is made on the basis of the following presumptions:
i.

The scheme has been based and worked out on single shift basis of 8 hours
and 300 working days in a year with a 25% idle time left for breakdown,
maintenance, repairs etc. To get production on economic scale, full utilization
of capacity in three shift basis is recommended. Initial target has been fixed at
810 MT of casting at 60% capacity utilization on single shift basis for first year
of production.

ii.

Time period for achieving full capacity utilization will be 4 years and 60% to
80% of capacity utilization for 1st, 2nd and 3rd years of production. It is
assumed that the unit will be viable at 75% efficiency on single shift basis
considering 6 working days per week.

iii.

The rate of interest in the scheme is taken at 11.5 % for both fixed and
working capital. Due to liberalization and competition among banks, lower
rate of interest is possible in future.

iv.

The prices of machinery and equipments are approximate which are ruling
locally at the time of preparation of the project. When a tailor-cut project is
prepared the necessary changes are to be made at the local level.

v.

The cost of staff and labor is approximate which is ruling locally at the time
of preparation of the profile. When a tailor-cut project is prepared the
necessary changes are to be made..

vi.

There is a 5% burning loss in the project.

vii.

BEP in the scheme has been calculated on the basis of full capacity utilization.

viii.

Payback period of 10 years with moratorium period of 1.5 years.

4. IMPLEMENTATION SCHEDULE
The project can be implemented in a period of 16 to 18 months by performing
the various activities in a systematic manner and simultaneous application of
various common activities as mentioned below;
i.
ii.
iii.
iv.
v.
vi.
vii.
viii.
ix.
x.

Preparation of project reports

Provisional registration
Selection of site
Arrangement of finance/loans
Land acquisition & construction of building
Machinery & equipment procurement
Recruitment of staff & labour
Installation of machinery
Trial production
Commercial Production

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1st month
2nd month
2nd month
3rd 5th month
6th 9th month
10th 13th month
14th month
15th month
16th month
16th month

Metallurgy Division

5. TECHNICAL ASPECTS
5.1. Process of Manufacturing
Manufacture of Master Pattern
Manufacture of Dies for Wax Pattern
Preparation of Wax Compound
Manufacture of Wax Pattern
Investment of Wax with Slurry
Drying of Shell Thickness
De-waxing of Raw Moulds
Heating and Baking of Shells
Pouring of moulds with molten metal
Casting
Inspection
Dispatch
Metal Scrap is melted in induction furnace and tapped in ladles. Invested
moulds are poured with the molten metal to get the desired castings. Castings are
cooled down and are fettled. The casting is investigated and dispatched. If desired
the ferro-alloys are added in the ladle itself to get desired composition.

5.2. Quality Control and Standards

In the present scheme the inclusion of chemical testing will enable the unit to
adopt quality control measure starting from selection and grading of scrap to
confirmation of standards for the final casting.

5.3. Production Capacity

Quantity 810 MT (per annum); Value Rs. 7,71,56,000/-

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Investment Casting

5.4. Motive Power

Approximate motive power requirement will be 700 K.W. per ton of cast
manufacture.

5.5. Pollution Control

Foundry industry has a share in the present environmental degradation &
therefore No Objection Certificate (NOC) is required from State Pollution Control
Board.
There are mainly two methods for pollution control in foundry industries:
By exploiting the meteorological and topographical conditions.
By using various equipments for cleaning & dispersion of foundry emission.

5.6. Energy Conservation

There is scope to conserve the energy by installing energy conservation
equipment, so as to have minimum heat losses from melting induction furnace. With
the aid of energy server power economizer electrical circuit & energy efficient right
energy circuit and neutral lighting of electrical energy can be conserved.

6. FINANCIAL ASPECT
6.1. Fixed Capital
Land & Building:
S.N.
1.

Land 10,000 ft2

Description
@ Rs. 4.0 per ft2

Rent per month(Rs.)

40,000/-

2.

Covered Area 600 ft2 @ Rs.10.0 per ft2

6,000/-

3.

Working Shed area 1000 ft2 @ Rs. 8.0 per ft2

Total Rent

8,000/54,000/-

6.1.1. Machinery and Equipments

S.
N.
(a)

Description of Machine and make

(Indigenous/ Imported)
Production Unit

1.

1000 kg. 450 KW Medium Frequency Coreless Melting

Induction Furnace along with Crucible, Generator,
Hydraulic System and Electrical Control complete
(Indigenous)

50,00,000

2.

Grease Pump for pumping Furnace Oil (Indigenous)

40,000

3.

Auxiliary transformer (Indigenous)

2,50,000

4.

Cooling Tower (Indigenous)

75,000

5.

Water softening plant (Indigenous)

65,000

6.

20 MHz oscilloscope (Indigenous)

25,000

7.

5 ton capacity crane (Indigenous)

3,50,000

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Qty.

Amount
(Rs)

Metallurgy Division
S.
N.

Description of Machine and make

(Indigenous/ Imported)

Qty.

Amount
(Rs)

8.

Water & Pipe line (Indigenous)

50,000

9.

Ladle heating burner with heating pumps etc

(Indigenous)

35,000

10

Plate type heat exchange (Indigenous)

75,000

11

Mould cooler (Indigenous)

70,000

12

Die making machine (Indigenous)

15,000

13

Wax injection machine (Indigenous)

18,000

14

Air compressor with 5 HP motor (Indigenous)

12,000

15

Metal spraying equipments complete with accessories

(Indigenous)

One set

35,000

16

Compressed Air Spray Gun for Preliminary Investment

(Indigenous)

4,000

17

Special purpose machine for sprinkling the wax

pattern with key in grey factory (self-fabricated)
(Indigenous)

20,000

18

Dough mixer used for preparing the investment slurry

(Indigenous)

18,000

19

Electric drying oven with uniform air circulation with

55 shelves (Indigenous)

16,000

20

Core baking oven(self-constructed coke fired)

(Indigenous)

15,000

21

Moulding boxes of assorted sizes (Indigenous)

LS

25,000

22

Moulding hand tools (Indigenous)

5,000

23

Weighing scale with weight (Platform type)

(Indigenous)

15,000

24

Gravity die mould (Indigenous)

LS

20,000

25

Motorized grinder( double ended) (Indigenous)

7,000

26

Pyrometer (Emersion type as thermocouple)

(Indigenous)

3,000

27

Arc welding machine (Indigenous)

15,000

28

Bench drilling machine (Indigenous)

8,000

29

Transformer (Indigenous)

5,00,000

30

Material handling equipment hand trolley etc.

(Indigenous)

15,000

31

Fettling and cutting tools (Indigenous)

LS

12,000

32
(b)

Measuring/ Inspecting tools (Indigenous)

Testing Equipments

15,000

33

Universal testing machine (Indigenous)

1,50,000

34

Hardness testing machine (Indigenous)

75,000

35

Centrifugal testing machine (Indigenous)

2,000

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Investment Casting
S.
N.

Description of Machine and make

(Indigenous/ Imported)

Qty.

36

Laboratory scale weighing machine (Indigenous)

37

Chemical Testing Equipments with accessories

(Indigenous)
Pollution Control Equipments

LS

2,00,000

Equipments like dust precipitators, fume extractor,

exhaust, hoods etc (Indigenous)
Energy Conservation Equipment

LS

3,50,000

(c)
38
(d)

Amount
(Rs)
20,000

39.

Energy Saver Power Economizer Electronic

Circuit (Indigenous)

1,00,000

40.

Energy efficient lighting energy saver circuit of neutral

lighting (Indigenous)

75,000

(e)
(f)

Electrification and Installation Charges @ 10% of cost

of machinery and equipments of Rs 78,00,000
Total Cost of machinery & equipments

(g)

Cost of moulds/ other fixtures

(h)

Office equipment and furniture (Indigenous)

7,80,000
85,80,000
10 ladle
L.S.

2,00,000

TOTAL

88,60,000

Preoperative expenses like legal, establishment, traveling,

Startup consultancy, telephone, electricity connections etc

Total Fixed Capital

80,000

Rs. 2,50,000/-

Rs. 91,10,000/-

6.2. Working Capital (per month)

6.2.1. Personnel
S.N. Designation
1.
Metallurgist/ Foundry
Technologist

Nos.
1

Salary (Rs.)
12,500

Total (Rs.)
12,500

2.

Shop supervisor

11,000

11,000

3.

Skilled labours

12

9,500

1,14,000

4.

Semi-skilled labours/Helpers

15

8,500

1,27,500

5.

Laboratory assistant

9,000

9,000

6.

Accountant cum clerk, typist

8,500

8,500

7.

Store keeper

8,000

8,000

8.

Peon-cum-watchman

7,500
Total
Add perquisites etc. @ 15%
Total

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15,000
3,05,500
45,825
3,51,325

Metallurgy Division

6.2.2. Raw Materials including Packaging Materials

Particulars
Graded Steel/ alloy steel

Indigenous/
Imported
Indigenous scrap
form

Quantity

Rate/ MT Value(Rs.)

81 MT

38,000

30,78,000

60,000

6,00,000

Wax

--do--

10MT

Ferro-alloys

--do--

LS
Total

2,00,000
38,78,000

6.2.3. Utilities
Power 54,000 kWH @ Rs. 6.50/- per kWH
Furnace Oil 12,000 litres @ 51/Ltr.
Water
Total

Rs. 3,51,000
Rs. 6,12,000
Rs. 2,500
Rs. 9,65,500

6.2.4. Other Contingent Expenses (Per Month)

S.No.
1.

Particular

Amount (Rs.)
54,000

Rent

2.

Foundry consumables like ramming mass, bentonite, silica

/Zircon, Films, Foundry sand, fluxes, coats & chemicals

80,000

3.

Transport expenses

2,500

4.

Stationery, Postage, Telephone and fax etc

1,500

5.

Telephone

1,500

6.

Insurance

1,000

7.

Advertisement & Publicity

10,000

8.

Repair, Maintenance and Replacement

15,000

9.

Consumable stores

2,500

10. Miscellaneous
Total

6.2.5. Total Recurring Expenditure (per month)

2,000
1,70,000

Rs. 53,64,825

6.3. Total Capital Investment

Fixed Capital
Working Capital for 3 months

Rs. 91,10,000
Rs. 1,60,94,475

Total

Rs. 2,52,04,475/-

Machinery Utilisation
75% machinery utilization is considered for achieving the projected capacity
of finished products. Melting will be performed as per demand.

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Investment Casting

7. FINANCIAL ANALYSIS
7.1. Cost of Production (per annum in Rs.)
1. Total Recurring Cost

6,43,77,900

2. Total Depreciation (a+b+c)

17,76,000

a. Depreciation on Machinery and Equipment including furnace

@ 20% (for Rs 85,80,000)

17,16,000

b. Depreciation on tools & fixture @ 25% (for Rs. 80,000)

20,000

c. Depreciation on office equipments @ 20 % (for Rs.2,00,000)

40,000

3. Interest on total Capital @ 11.5 % (Approx.)

28,98,515
Total (1+2+3)

6,90,52,415

7.2. Turnover (per annum)

S.N.
1.
2

Item
Steel Casting

Quantity(MT)
810

Scrap/ Rejected items

112

7.3. Net Profit (per annum)

=

Turnover Cost of Production

Rs. 7,71,56,000 - 6,90,52,415

Rs. 81,03,585/-

7.4. Net Profit Ratio

=

Net profit per year

X 100
Turnover per year

81,03,585
X 100
7,71,56,000

= 10.50 %

7.5. Rate of Return

=

Net profit per year

X 100
Total Capital Investment

81,03,585
X 100
2,52,04,475

= 32.15 %
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Rate/ton
90,000
38,000
Total

Value (Rs.)
7,29,00,000
42,56,000
7,71,56,000

Metallurgy Division

7.6. Break-even Point

Fixed Cost

(Rs.)

Rent

6,48,000

Total Depreciation

17,76,000

Total Interest

28,98,515

Insurances, Taxes, etc.

12,000

40% of salary and wages

16,86,360

40% of other Contingent expenses

(Excluding rent & Insurance)

5,52,000

Total

75,72,875

B.E.P
=

Fixed Cost
X 100
Fixed Cost + Net Profit

75,72,875
X 100
75,72,875 + 81,03,585

= 48.31%

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Investment Casting

Address of Machinery & Raw Material Suppliers

1. M/s. Electrotherm (India) Ltd., 414, MIDC, Phase - II, Opp. Visol Crossing,
Vatva, Ahmedabad
2. M/s. General Electric Co. of India Limited, Magnet House, 6, Chittaranjan
Avenue, Kolkata 13
3. M/s. Hindustan Brown Bovery Limited, 20, Grashani Road, Ballard Estate,
Mumbai - 1.

Addresses of Raw Material

a.
1.
2.
3.

Suppliers of Scrap
M/s. Metal Scrap Trading Corporation.
M/s. Mishra Dhatu Nigam.
M/s. S.A.I.L.

b.
1.
2.
3.
4.
5.

Ferro-alloys and Other Consumable Stores

M/s. Global Linkers (P) Ltd. 2992, Ajmeri Gate, Kamala Market, Delhi - 6.
M/s. Ferro-Alloys Corporation 122, Jorbagh, New Delhi and Tumsar (M.S.)
M/s. Chemical and Scientific Corpn. 2133, Tilak Bazar, Khari Baoli, Delhi - 6.
M/s. Metonim Alloys 3992, Ajmeri Gate, Delhi - 6.
M/s. Nav Bharat Ferro Alloys Ltd.Erramanjil, Hyderabad.

c.
1.
2.
3.
4.
5.

Foundry Fluxes and Chemicals

M/s. Achme Foundry Flux and Co. Hadapsar, Pune - 13.
M/s. Greaves Ferro Ltd. Penjugutta, Hyderabad - 34.
M/s. ABC Metallurgicals Pvt. Ltd. 12, Belighuta Road, Kolkata - 15.
M/s. Ferro Alloy Corporation 122, Jorbagh, New Delhi - 110 003.
M/s. Greaves Cotton Co. Ltd. 201, Nirmal Tower, 26, Brasa Khambi Road,
New Delhi.
6. M/s. Bhagwati Silicate & Chemical Works Dehradun Road, Saharanpur (U.P.)
7. M/s. Chemic Industries Bulandghar Indl. Area, Gaziabad.
8. M/s. Frontier Chemical Industries G.T. Road, Shahdara.
9. M/s. N.K. Hookers Ltd. 4, Midland Crescent, London - KW - 3.
10. M/s. B.S.A. Precision Casting Foundry, Stanley Road, Waras, England.
d. INVESTMENT CASTING
1. M/s. British Information Centre British High Commissioner, New Delhi - 21
2. M/s. Ratankar Industries 15, Tatel, Block 10/2, Erandvana, Karve Road, Pune
e. For Wax Injection
1. M/s. Spares and Equipment Ltd. 62-64, Milk Street, Bristol, (England)

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