EXECUTIVE SUMMAARY

First i have a working experience in organization of rubber pipe manufacturing

The RUBBER Pipes Manufacturing Unit is a project of Rubber sector. Rubber pipe production line is
mainly used in the automobiles for fuel; pipe is the latest product in the overall history of pipe
manufacturing. It is economical, , high temperature resistant, reduced breakage and leakage, stain free
nature and so on.
The size of pipe is about 4 mm to 16 mm and is widely used in brake pipe and fuel pipe in the bike or
car .the Rubber Pipe manufacturing unit needs a capital investment estimated at Rs.3 million for
Construction of Factory and Purchasing machinery & equipment. In addition to this, an estimated sum
of Rs. 2lakh is required as Working Capital. The total project cost is estimated at 4.5 mm. Labors is
about 50 worker and 4 executive and 5 supervisor

INTRODUCTION

Project Brief
The proposed project entails setting rubber manufacturing Unit, which has a product range of 4mm,
20mm. This can be sold in the local market as well as in the foreign market. The objective of this pre-
feasibility study is to provide information for setting up rubber pipes manufacturing unit
2. Projectt RRaattiioonnaallee
Demand for rubber Pipes is influenced by general economic conditions as well as the number of new
cars and bikes. New bikes also present opportunities for sales of pipe, bath rooms and latrine facilities.
RUBBER pipes are prevailing rapidly because of their multiple usages and advantages. , such as:
• BIKES BRAKE PIPE

• GAS PIPE
• OIL PIPE
• A.C PIPE
• BRAKE PIPE.

The development in civil works is a continuous process and the civil works related industries are
developing day by day. Most of the RUBBER Pipes manufacturing units are part of small-scale
industry. Rubber pipe manufacturing is a small sector and needs further attention, both from the public
and private sector. The market for rubber pipes exists in almost every part of the country. There are a
few major market players and the small units cater the remaining market. In recent times, due to
setting up of a few quality units, it is evident that local sales & exports can also be increased by this
sector in the near future.

PROPOSED CAPACITY
The production capacity of the proposed project is 50 LAKH FOOT
Pipes per year.

THE TOTAL PROJECT COST

The estimated cost of the project is about Rs. 4.5 million

Market Size
RUBBER Pipes are being sold in almost every city of the country. Small manufacturers have taken the
major share of the market in small cities. However, the major players have occupied the market of
major cities. In major cities the customers are quality conscious and ready to pay for quality products.
Majority of the population of the country lives in the rural areas and small cities and major producers
need to pay special attention to the prices of their products, as the small markets are price sensitive.
The local products are fulfilling the demands of the local market, however, in major cities imported
RUBBER pipes are also being sold, but it is in little proportion as compared to the total market
demand

CURRENT INDUTY STRUCTURE

Because of the high demand RUBBER Pipes, there has been an increase in small manufacturing units
of RUBBER pipes exist in the main cities of the country i.e. Lahore, Gujranwala, Faisalabad, Multan
& Karachi. The RUBBER pipe manufacturing industry of Pakistan is a small-scale industry. It
comprises mainly of small units and there are only a few units, which have a significant market
presence. These market leaders are producing RUBBER pipes under trademarks OF BRIDGESTONE,
LONGMAN.
Presently, RUBBER pipes imported from China, Iran and Turkey dominate the sales in the local
markets, whereas the local RUBBER Pipes have a small share in the local market, the reason being the
unavailability of good quality RUBBER pipes.
It is worth noticing that the market leaders have monopoly in major market. The new entrants have
tried to break this monopoly and provided a good variety of quality products in the local market, which
have been well received. Some of the new entrants that produce high quality products have taken share
of the market, but still there is a need for more producers.

PRODUCT OFFERED
The proposed project will be capable of making rubber Pipes with manufactured sizes of 4 mm, 20mm
pipes

PRODUCTION PROCESS

A; RAW MATERIAL
B; RULLING
C; EXTURSION
D; BREADING\
E; FINISHING
F; PACKING
G; MARKET
MANUFACTURING PROCESS
1. RULLING
In which you crush the rubber and mix special clay in the rubber to make its strength

2. EXTURSION

. Mixing is done at high speed mixer at high temperature. The melted compound is passed through
a warm die fixed to the extruder to get a specific size and quality of PIPE.

4. BREADING.

In this section pipe is bread by breading machine

5. HEATING
I this process the pipe am steamed by a steam of boiler at the temperature of 40 Celsius

6. Cutting
After maturing pre decided/desired lengths an automatic machine come into force and cut the
pipes as per the standard length of 14 feet

7. Final Inspection & Packing This is the last process of production. Finished products are
inspected and only those complying with the standards are considered passed. Passed products are
carefully packed and then send the customer.

77 MACHINERY REQUIREMENTS
Following list MACHINERY for the RUBBER PIPE MANUFACTURING UNIT.
Machinery Requirement
Cost (Rs.) Total Cost (Rs.)
Unit
Extruder 1 unit 1,020,000 1,020,000
Mould (Pipe) 1 set 340,000 340,000
Vacuum tank 1 set 425,000 425,000
Hauling off 1 set 323,200 323,000
Cutter 1 set 246,500 246,500
Stacker 1 unit 42,500 42,500
Freight Charges 119,000 119,000
Misc. Charges (Erection & Installation) 503,200
Generator (165 KVA
1 Set 800,000 800,000
Made in China)
Total 3,819,200
PRODUCTION
For the purpose of this project, the extruder machine with total capacity of 100 kg/hour will be used
for the production of PPRC Pipes. PPRC pipe production/extrusion line/PPRC pipe making machinery
is used to produce PPR pipes for cold and hot water supply. It's composed of vacuum feeding machine,
hopper dryer, single screw extruder, mould, make line co-extruder, vacuum calibration and cooling
tank, extended spraying cooling tank, haul off machine, cutter and stacker. PPRC cool and hot water
pipe extrusion line is used by single screw extruder for extruding the pipes with various tube diameters
and the wall thickness.

Production Capacity of the Project

As the maximum capacity of PPRC Pipes (without wastage) is 230 tons per year and the percentage
share of 25mm, 32mm and 40mm pipes in total production capacity are 60%, 25% & 15%
accordingly. Table 8-1 summarizes the sizes of the three sizes of PPRC pipes being recommended in
this pre-feasibility study.

Size Wall Thickness Length Net Weight (grm)

4 mm 1.5mm 14 ft 600
20 mm 4 mm 14 ft 900

99 HUMAN RESOURCE REQUIREMENTS

The total HR required for this project is as follows::
Table Human Resource Monthly Salary Annual Salary in (Rs)
Requirement Number of (Rs)
Personnel
Production Manager 1 25,000 300,000
Accountant 1 15,000 180,000
Extruder Operators 1 10,000 120,000
Store In charge 1 8,000 96,000
Helpers 5 7,500 450,000
Guards 2 8,000 192,000
Marketing & 1 15,000 180,000
Purchase Officer
Total 126,500 1,518,000
OTHER FFICE EQUIREMENT
Total office equipment and furniture required for the projects mentioned below::
 Table Office Equipment Cost / Unit
Total Cost (Rs.)
Unit
Computer 2 25,000 50,000
Printer 1 14,000 14,000
UPS 2 8,500 17,000
Telephone Set 2 1,000 2,000
Fax Machine 1 12,000 12,000
Total 95,000

Table Furniture Fixture Cost / Unit Total Cost (Rs.)

Unit
Office Table 3 12,000 36,000
Chairs 6 3,500 21,000
Computer Table 2 10,000 20,000
Computer Chairs 2 2,500 5,000
Sofa Set 1 10,000 10,000
Office Cabinet 1 25,000 25,000
Electrical Wiring & Lighting 25,000
Air Conditioner 2 35,000 70,000
Total 212,000

LAND & BUILDING

For the proposed project, an area of about 9,200 sq. ft. is required. It is recommended that the land
should be bought. The det
Table Building Area (sq. ft) Construction Total in (Rs)
Covered Area (Rs./sq. .ft)
Requirement
Management 400 1,300 520,000
building
Production Area 6,000 850 5,100,000
Raw Material Store 900 700 630,000
Finished goods store 1,200 700 840,000
Loading area 700 700 490,000
Total Construction Cost 9,200 7,580,000
Ails of the area required for different activities are given below:
PROJECT ECONOMICS
Total Investment Initial FinancingDebt50%Equity50%EquityIRR61%Payback Period (yrs) 3.28 Net Present
Value36, 938,863Capital Investment Rs. In actual Land 3,680,000 Building/Infrastructure 7,580,000
Machinery & equipment 3,819,200 Furniture & fixtures 212,000 Office equipment 95,000 Pre-operating costs
305,000 Total Capital Costs 15,691,200 Working Capital Rs. In actual Equipment spare part inventory -
Raw material inventory 1,939,950 Cash 545,293 Total Working Capital 2,485,244 18,176,443 Rs. In actual
9,088,222 9,088,222 Project 47% 3.56 35,650,548

KEY ASUMPTIONS
Table Operating Assumptions 8
Hours operational per day
Days operational per month 25
Days operational per year 300
Table production assumptions 230,400
annual production capacity kg
Capacity utilization (1st Year) 50%
Capacity growth rate (yearly) 10%
Maximum Capacity utilization 95%
Production Wastage 5%
Table Cash Flow Assumptions 30
Accounts Receivable cycle (in
days)
Accounts Payable cycle (in days) 30
Raw material inventory (in days) 30
Finished Goods inventory (in days) 3
Table Economic Assumptions 10%
ELETRICITYth rate
Wages growth rate 10%
Office equipment growth 5%
Machine maintenance growth rate 5%
Table Cash Flow Assumptions 30
Accounts Receivable cycle (in
days)
Accounts Payable cycle (in days) 30
Raw material inventory (in days) 30
Finished Goods inventory (in days) 3
Table Exense Assumptions Professional 0.1% of Revenue
fees (audit, legal etc.)
Office Expenses (stationery, 10% of Administration Expense
entertainment, etc.)
Promotional Expenses 2% of revenue
Table 114444--66 Depreciation Straight Line
Rates Depreciation Method
Building & infrastructure 5%
Machinery & Equipments 10%
Furniture & Fixtures 10%
Table Financial Assumptions 10
Project life (Years)
Debt: Equity 50:50
Interest rate on long term debt 16%
Discount rate for calculation of 20%
NPV
Table Raw Weight (gmr) Rate Total Cost (Rs.)
Material
Consumption Per
ppe Size
4 mm 600 15 16
20mm 900 60 65

Weighted Avg. price 81.00

Table Product Average Sale Price Size Price (Rs)
4 mm 20
20 mm 80

Weighted Avg. price 100.00