PROJECT REPORT

Of

OFFSET PRINTING

PURPOSE OF THE DOCUMENT

This particular pre-feasibility is regarding Offset Printing Unit.

The objective of the pre-feasibility report is primarily to facilitate potential entrepreneurs in project
identification for investment and in order to serve his objective; the document covers various aspects
of the project concept development, start-up, marketing, finance and management.

[We can modify the project capacity and project cost as per your requirement. We can also prepare
project report on any subject as per your requirement.]

Lucknow Office: Sidhivinayak Building ,

27/1/B, Gokhlley Marg, Lucknow-226001

Delhi Office : Multi Disciplinary Training

Centre, Gandhi Darshan Rajghat,
New Delhi 110002

Email : info@udyami.org.in
Contact : +91 7526000333, 444, 555
 PROJECT AT A GLANCE

1 Name of the Entreprenuer XXXXXXX

2 Constitution (legal Status) : XXXXXXX

3 Father's/Spouce's Name XXXXXXXX

4 Unit Address : XXXXXXXX

Taluk/Block:
District : XXXXX
Pin: XXXXX State: XXXXX
E-Mail : XXXXX
Mobile XXXXX

5 Product and By Product : Magazines, Souveiners

6 Name of the project / business activity proposed : Off set Printing Unit

7 Cost of Project : Rs. 9.75 Lacs

8 Means of Finance
Term Loan Rs. 5.85 Lacs
KVIC Margin Money As per Project Eligibility
Own Capital Rs. 0.98 Lacs

9 Debt Service Coverage Ratio : 3.60

10 Pay Back Period : 5 Years Years

11 Project Implementation Period : 6 Months Months

12 Break Even Point : 0.38

13 Employment : 8 Persons

14 Power Requirement : 5 KW

15 Major Raw materials : Paper, Cardsheet,Ink , Gum etc

16 Estimated Annual Sales Turnover : Rs. 35.63 Lacs

16 Detailed Cost of Project & Means of Finance

COST OF PROJECT (Rs. In Lacs)

Particulars Amount
Land Rented/Owned
Plant & Machinery 6.50
Furniture & Fixtures 0.45
Working Capital Requirement 2.94
Total 9.89

MEANS OF FINANCE
Particulars Amount
Own Contribution 10% 0.99
Term Loan 6.26
Working capital 2.65
Total 9.89
General Special
KVIC Margin Monery Urban 15% 25%
KVIC Margin Monery Rural 25% 35%
 OFFSET PRINTING

INTRODUCTION

Offset Printing is the latest method of printing system in any language. The
method of printing in earlier days was by rotary printing press in which the
matter to be printed was to be first composed manually.

In Offset printing, the matter which is to be printed is fed into the computer
and after that with the help of the camera, it is exposed and film is prepared
through developer/chemicals and put into Offset printing Machine to take
out the print. Offset printing method is the latest one where the quality of
printing is very fine in comparison to the previous method.
MARKET POTENTIAL
Today is the age of technology. Offset Printing Press is the example of new
technology. The required material may be printed in minimum time with
good accuracy and better quality. Now a days, the number of schools,
colleges, offices and other business activities is increasing day by day. They
require stationery, books and other printed materials. Therefore, Offset
Printing Press has very good scope, particularly in Urban and semi–Urban
areas.

BASIS AND ASSUMPTIONS

i) This report is worked out on the basis of 50% capacity utilization on Single
Shift and 300 working days per annum.

ii) The machinery and equipment are of standard make.

iii) The cost of raw materials and other expenditure is approximate and
based on current market rates.

iv) The period for achieving envisaged capacity utilization is estimated to be

one year after commencement of production.

v) Interest rate for fixed and working capital has been calculated @ 11% per
annum.

vi) Payback period would commence immediately and the repayment period
is estimated at 5 years.

IMPLEMENTATION SCHEDULE
1. The entrepreneur has to arrive at a decision in order to select this product.
The guiding factor in this regard would be the market potential, demand and
supply gap and availability of resources. It may take 2 to 3 weeks’ time.

2. After selecting the product, the entrepreneur has to get provisional

registration from DIC, so that he can apply for allotment of land, power, etc.,
for which about one-week time is required.
3. In order to obtain financial assistance from the financial Institutions, like
Commercial Banks or State Financial Corporations, a detailed Project Report
is required to be prepared. On the basis of the report, financial institutions
may take 8 to 12 weeks time for sanctioning and disbursing the loan.
Accordingly, orders for plant and machinery may be finalized and placed.
Simultaneously, order for purchase of raw materials is also to be finalized
and recruitment of key staff is to be done. This would require 3 to 4 weeks’
time.

TECHNICAL ASPECTS

Process of Manufacture

Composing of matter which is to be printed, is done on computer with the

help of special Software’s such as Corel Draw, Photoshop, MS Office, Page
Maker, etc., Thereafter a film is produced with the help of a camera. This film
is called negative. The matter, which is to be printed is taken on this
film/negative.

The negative and an aluminium plate are put into the printing down
frame/exposer. Before starting the exposer, the pre-setting of timer is done
in the timer/watch. Generally, it takes approx. 200 seconds for making
positive. The time exposer is switched off automatically as soon as positive
has been built up. The image of negative is printed on the aluminium plate,
which is called positive. After that, the developer is spread on the plate
followed by washing with the fresh water. During this process, the matter
gets printed on the plate automatically. Thereafter, the aluminium plate is
fitted in the offset printing press. This plate is called P.S. Plate, when it is
used for first time and thereafter it is called Y-pon Plate. The papers are cut
on Paper Cutting Machine. Then the papers are fed one by one into Offset
Printing Press. Generally, the capacity of offset printing press is 4000
impressions per hour.

Quality Control and Standards

As per Customers’ requirements.

Pollution Control

The manufacturing activity does not pose any pollution as such no special
pollution measures are required.

Energy Conservation

Wastage of energy should be minimised as much as possible so that the unit

can withstand competition with similar unit.
PROJECTED BALANCE SHEET

PARTICULARS IST YEAR IIND YEAR IIIRD YEAR IVTH YEAR VTH YEAR

SOURCES OF FUND

Capital Account 0.99 0.99 0.99 0.99 0.99

Retained Profit 2.29 5.32 9.95 15.47 22.26
Term Loan 5.00 3.75 2.50 1.25 -
Cash Credit 2.65 2.65 2.65 2.65 2.65
Sundry Creditors 0.17 1.00 1.17 1.34 1.50

TOTAL : 11.10 13.71 17.25 21.69 27.40

APPLICATION OF FUND

Fixed Assets ( Gross) 6.95 6.95 6.95 6.95 6.95

Gross Dep. 1.00 1.87 2.61 3.25 3.79
Net Fixed Assets 5.95 5.08 4.34 3.70 3.16

Current Assets
Sundry Debtors 1.71 2.09 2.44 2.79 3.14
Stock in Hand 1.40 1.68 1.96 2.24 2.52
Cash and Bank 2.04 4.86 8.51 12.95 18.57

TOTAL : 11.10 13.71 17.25 21.69 27.40

- - - - -
PROJECTED CASH FLOW STATEMENT

PARTICULARS IST YEAR IIND YEAR IIIRD YEAR IVTH YEAR VTH YEAR

SOURCES OF FUND

Share Capital 0.99 -

Reserve & Surplus 2.29 3.03 4.63 6.13 7.54
Depriciation & Exp. W/off 1.00 0.87 0.74 0.63 0.54
Increase in Cash Credit 2.65 - - - -
Increase In Term Loan 6.26 - - - -
Increase in Creditors 0.17 0.84 0.17 0.17 0.17

TOTAL : 13.35 4.74 5.54 6.93 8.25

APPLICATION OF FUND

Increase in Fixed Assets 6.95 - - - -

Increase in Stock 1.40 0.28 0.28 0.28 0.28
Increase in Debtors 1.71 0.38 0.35 0.35 0.35
Repayment of Term Loan 1.25 1.25 1.25 1.25 1.25
Taxation - - - 0.61 0.75

TOTAL : 11.31 1.91 1.88 2.49 2.64

Opening Cash & Bank Balance - 2.04 4.86 8.51 12.95

Add : Surplus 2.04 2.82 3.66 4.44 5.62

Closing Cash & Bank Balance 2.04 4.86 8.51 12.95 18.57
PROJECTED PROFITABILITY STATEMENT

PARTICULARS IST YEAR IIND YEAR IIIRD YEAR IVTH YEAR VTH YEAR

Capacity Ulisation %
A) SALES

Gross Sale(Offset Printing) 73.25 89.65 104.65 119.65 134.65

Total (A) 73.25 89.65 104.65 119.65 134.65

B) COST OF SALES

Raw Mateiral Consumed 49.81 60.07 70.12 80.17 90.22

Elecricity Expenses 1.47 1.79 2.09 2.39 2.69
Repair & Maintenance 0.73 1.79 2.09 2.39 2.69
Labour & Wages 5.28 5.81 6.39 7.03 7.73
Depreciation 1.00 0.87 0.74 0.63 0.54
Cost of Production 58.29 70.33 81.43 92.61 103.87

Add: Opening Stock /WIP - 1.40 1.68 1.96 2.24

Less: Closing Stock /WIP 1.40 1.68 1.96 2.24 2.52

Cost of Sales (B) 56.89 70.05 81.15 92.33 103.59

C) GROSS PROFIT (A-B) 16.37 19.60 23.50 27.32 31.06

22% 22% 22% 23% 23%
D) Bank Interest (Term Loan ) 0.64 0.50 0.36 0.22 0.09
Bank Interest ( C.C. Limit ) 0.29 0.29 0.29 0.29 0.29
E) Salary to Staff 2.16 2.33 2.52 2.72 2.94
F) Selling & Adm Expenses Exp. 10.99 13.45 15.70 17.95 20.20

TOTAL (D+E) 14.08 16.57 18.87 21.18 23.51

H) NET PROFIT 2.29 3.03 4.63 6.13 7.54

I) Taxation - - - 0.61 0.75

J) PROFIT (After Tax) 2.29 3.03 4.63 5.52 6.79

K) DIVIDEND - - - - -

L) RETAINED PROFIT 2.29 3.03 4.63 5.52 6.79

COMPUTATION OF OFFSET PRINTING UNIT

Items to be Manufactured Off set Printing Unit

Booklets
Manufacturing Capacity Off set Printing Unit 400

No. of Working Hour 10

No of Working Days per month 25

No. of Working Day per annum 300

Total Production per Annum Off set Printing Unit 1,20,000

-
Year
Capacity Utilization

Off set Printing Unit

IST YEAR 50% 60,000.00
IIND YEAR 60% 72,000.00
IIIRD YEAR 70% 84,000.00
IVTH YEAR 80% 96,000.00
VTH YEAR 90% 1,08,000.00

COMPUTATION OF SALE

Off set Printing Unit

Particulars IST YEAR IIND YEAR IIIRD YEAR IVTH YEAR VTH YEAR

Op Stock - 1,400.00 1,680.00 1,960.00 2,240.00

Production 60,000.00 72,000.00 84,000.00 96,000.00 1,08,000.00
60,000.00 73,400.00 85,680.00 97,960.00 1,10,240.00
Less : Closing Stock 1,400.00 1,680.00 1,960.00 2,240.00 2,520.00
Net Sale 58,600.00 71,720.00 83,720.00 95,720.00 1,07,720.00

Sale Price Per Booklet 125.00 125.00 125.00 125.00 125.00

Sale (in Lacs) 73.25 89.65 104.65 119.65 134.65

COMPUTATION OF CLOSING STOCK & WORKING CAPITAL

PARTICULARS IST YEAR IIND YEAR IIIRD YEAR IVTH YEAR VTH YEAR

Stock of Consumables
(15 Days requirement) 1.40 1.68 1.96 2.24 2.52

Closing Stock 1.40 1.68 1.96 2.24 2.52

COMPUTATION OF WORKING CAPITAL REQUIREMENT

Particulars Total Own Bank

Amount Margin Finance

Stock in Hand 1.40 10% 0.14 90% 1.26

Sundry Debtors 1.71 10% 0.18 90% 1.53

3.11 10% 0.32 90% 2.79

Sundry Creditors 0.17 10% 0.03 90% 0.14

2.94 0.29 2.65

WORKING CAPITAL (HYP) FRESH DEMAND 2.65

2.65
BREAK UP OF LABOUR

Particulars Wages No of Total

Per Month Employees Salary

Skilled Worker 10,000.00 2 20,000.00

Unskilled Worker 6,000.00 4 24,000.00

44,000.00

Annual Cost ( in lacs) 5.28

BREAK UP OF SALARY

Particulars Salary No of Total

Per Month Employees Salary
Accountant 10,000.00 1 10,000.00
Marketing Executive 8,000.00 1 8,000.00

Total Salary Per Month 18,000.00

Annual Cost ( in lacs) 2.16

COMPUTATION OF DEPRECIATION

Description Land Plant & Furniture TOTAL

Machinery

Rate of Depreciation 15.00% 10.00%

Opening Balance Leased - - -
Addition - 6.50 0.45 6.95
- 6.50 0.45 6.95
Less : Depreciation - 0.98 0.02 1.00
WDV at end of Ist year - 5.53 0.43 5.95
Additions During The Year - - - -
- 5.53 0.43 5.95
Less : Depreciation - 0.83 0.04 0.87
WDV at end of IInd Year - 4.70 0.38 5.08
Additions During The Year - - - -
- 4.70 0.38 5.08
Less : Depreciation - 0.70 0.04 0.74
WDV at end of IIIrd year - 3.99 0.35 4.34
Additions During The Year - - - -
- 3.99 0.35 4.34
Less : Depreciation - 0.60 0.03 0.63
WDV at end of IV year - 3.39 0.31 3.70
Additions During The Year - - - -
- 3.39 0.31 3.70
Less : Depreciation - 0.51 0.03 0.54
WDV at end of Vth year - 2.88 0.28 3.16
REPAYMENT SCHEDULE OF TERM LOAN 11%

Year Particulars Amount Addition Total Interest Repayment Cl Balance

IST YEAR Opening Balance
Ist Quarter 6.26 - 6.26 0.17 0.31 5.94
Iind Quarter 5.94 - 5.94 0.16 0.31 5.63
IIIrd Quarter 5.63 - 5.63 0.15 0.31 5.32
Ivth Quarter 5.32 - 5.32 0.15 0.31 5.00
0.64 1.25
IIND YEAR Opening Balance
Ist Quarter 5.00 - 5.00 0.14 0.31 4.69
Iind Quarter 4.69 - 4.69 0.13 0.31 4.38
IIIrd Quarter 4.38 - 4.38 0.12 0.31 4.07
Ivth Quarter 4.07 4.07 0.11 0.31 3.75
0.50 1.25
IIIRD YEAR Opening Balance
Ist Quarter 3.75 - 3.75 0.10 0.31 3.44
Iind Quarter 3.44 - 3.44 0.09 0.31 3.13
IIIrd Quarter 3.13 - 3.13 0.09 0.31 2.81
Ivth Quarter 2.81 2.81 0.08 0.31 2.50
0.36 1.25
IVTH YEAR Opening Balance
Ist Quarter 2.50 - 2.50 0.07 0.31 2.19
Iind Quarter 2.19 - 2.19 0.06 0.31 1.88
IIIrd Quarter 1.88 - 1.88 0.05 0.31 1.56
Ivth Quarter 1.56 1.56 0.04 0.31 1.25
0.22 1.25
VTH YEAR Opening Balance
Ist Quarter 1.25 - 1.25 0.03 0.31 0.94
Iind Quarter 0.94 - 0.94 0.03 0.31 0.63
IIIrd Quarter 0.63 - 0.63 0.02 0.31 0.31
Ivth Quarter 0.31 0.31 0.01 0.31 - 0.00
0.09 1.25
CALCULATION OF D.S.C.R

PARTICULARS IST YEAR IIND YEAR IIIRD YEAR IVTH YEAR VTH YEAR

CASH ACCRUALS 3.29 3.90 5.37 6.15 7.33

Interest on Term Loan 0.64 0.50 0.36 0.22 0.09

Total 3.92 4.40 5.73 6.38 7.42

REPAYMENT
Instalment of Term Loan 1.25 1.25 1.25 1.25 1.25
Interest on Term Loan 0.64 0.50 0.36 0.22 0.09

Total 1.89 1.75 1.61 1.47 1.34

DEBT SERVICE COVERAGE RATIO 2.08 2.51 3.55 4.32 5.55

AVERAGE D.S.C.R. 3.60

BREAK EVEN POINT ANALYSIS

Year I II III IV V

Net Sales & Other Income 73.25 89.65 104.65 119.65 134.65
Less : Op. WIP Goods - 1.40 1.68 1.96 2.24
Add : Cl. WIP Goods 1.40 1.68 1.96 2.24 2.52

Total Sales 74.65 89.93 104.93 119.93 134.93

Variable & Semi Variable Exp.

Raw Material & Tax 49.81 60.07 70.12 80.17 90.22

Electricity Exp/Coal Consumption at 85% 1.25 1.52 1.78 2.03 2.29
Wages & Salary at 60% 4.46 4.88 5.34 5.85 6.40
Repair & Maintenance 0.73 1.79 2.09 2.39 2.69
Selling & adminstrative Expenses 80% 8.79 10.76 12.56 14.36 16.16
Intt. On Working Capital Loan 0.29 0.29 0.29 0.29 0.29
Total Variable & Semi Variable Exp 65.33 79.32 92.18 105.09 118.05

Contribution 9.32 10.61 12.75 14.84 16.88

Fixed & Semi Fixed Expenses

Electricity Exp/Coal Consumption at 15% 0.22 0.27 0.31 0.36 0.40

Wages & Salary at 40% 2.98 3.26 3.56 3.90 4.27
Interest on Term Loan 0.64 0.50 0.36 0.22 0.09
Depreciation 1.00 0.87 0.74 0.63 0.54
Selling & adminstrative Expenses 20% 2.20 2.69 3.14 3.59 4.04
Total Fixed Expenses 7.03 7.59 8.12 8.70 9.34

Capacity Utilization 50% 60% 70% 80% 90%

OPERATING PROFIT 2.29 3.03 4.63 6.13 7.54
BREAK EVEN POINT 38% 43% 45% 47% 50%
BREAK EVEN SALES 56.30 64.27 66.84 70.35 74.63
 DISCLAIMER

The views expressed in this Project Report are advisory in nature. SAMADHAN assume no
financial liability to anyone using the content for any purpose. All the materials and content
contained in Project report is for educational purpose and reflect the views of the industry
which are drawn from various research material sources from internet, experts, suppliers and
various other sources. The actual cost of the project or industry will have to be taken on case
to case basis considering specific requirement of the project, capacity and type of plant and
other specific factors/cost directly related to the implementation of project. It is intended for
general guidance only and must not be considered a substitute for a competent legal advice
provided by a licensed industry professional. SAMADHAN hereby disclaims any and all
liability to any party for any direct, indirect, implied, punitive, special, incidental or other
consequential damages arising directly or indirectly from any use of the Project Report
Content, which is provided as is, and without warranties.