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Oleoresins are the flavour extracts
obtained by the solvent extraction of the ground spices. They have aroma of
spice and possess the attributes which contribute to the taste such as
pungency. All the spices contain essential oils in varying proportions which
can be extracted by steam distillation. India is one of the leading producers
of spices and instead of exporting raw spices, it is advisable to export value-added products.
The oleoresins and spice oils are
preferred because of their microbiological advantages, uniformity in flavour
and pungency, easy to store and transport. They have
several applications like in the preparation of beverages, soup powders,
confectionary, curries, noodles, sauces, canned meat etc.
Compliance under the PFA Act is
mandatory. ISI has specified quality standards vide IS 5832 & 7826
of 1975.
Oleoresins and spice oils have large
domestic as well as export markets. They are consumed by a broad spectrum of
manufacturers like confectionary, noodles, beverages, sauces, canned meat, soup powders, curries, poultry products and so on. Most
of the end use industries are growing steadily and demand is bound to increase.
With increasing preference for quality products, use of spices is rapidly
replaced with oleoresins and spice oils. Exports of these processed
products, instead of raw spices, would also result in considerable value
addition.
To start with various raw spices are
cleaned and then ground to the required mesh size. Then
extraction is undertaken with the help of proper solvent. Solvents that can be
used are hexane, acetone, ethylene dichloride or alcohol. Extraction is done by
percolation of the solvents at room temperature through a bed of ground spice
packed in a SS percolator. Then the dark viscous extract
containing not less than 10% of total soluble solids are drawn off and
distilled under reduced pressure to remove the excess of solvent. The essential
oil is obtained by steam distillation. A typical flow chart is as under.
A plot of around 300 sq.mtrs. with
constructed area of 150 sq.mtrs. would be adequate for the contemplated
production capacity. Land may cost Rs. 90,000/-
whereas the cost of civil work is assumed to be Rs. 3.75 lacs.
For the contemplated installed capacity
of 1500 kgs. of spice oil and 3000 kgs. of Oleoresins per year with 12 hours
working per day and 300 working days every year, following equipments
shall be needed.
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Particulars
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Qty
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Amount
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Hammer type Disintegrators
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2
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1.00
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SS Percolators of 200 kgs.capacity
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2
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0.80
|
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Vacuum Distillation Still with 75/100
ltrs. capacity with vacuum pump and other accessories
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1
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10.50
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SS Storage tanks of 50 kgs. capacity
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2
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0.70
|
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Can sealer
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1
|
0.40
|
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Baby Boiler
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1
|
0.80
|
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Laboratory Equipments
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--
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0.50
|
|
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Total
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14.70
|
|
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Other assets like weighing scales,
furniture and fixtures, working tables, storage racks etc. would need around
Rs. 1.00 lac.
Power requirement shall be 15 HP whereas
water requirement will not be more than 2000 ltrs every day. LDO or coal shall
be required for boiler.
Raw spices like black pepper, ginger, turmeric, cinnamon and cardamon seeds shall be the main raw
materials. Appropriate solvent needs to be identified. Tin containers, lables,
corrugated boxes and BOPP tape shall be the packing materials.
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6.0 MANPOWER REQUIREMENTS
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|
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7.0 PROJECT IMPLEMENTATION
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|
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Particulars
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Area (Sq.Mtrs)
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Cost
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Land
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300
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0.90
|
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Building
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150
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3.75
|
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A provision of Rs. 14.70 lacs would take
care of the required machinery.
An amount of Rs. 1.00 lac is adequate
towards other support assets.
An amount of Rs. 1.50 lacs would take
care of pre-production expenses like establishment and registration charges, travelling, administrative expenses, interest during implementation,
trial runs etc.
At 60% capacity utilisation in the first
year, the working capital needs shall be as under.
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(Rs. in lacs)
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|
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Items
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Amount
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Land and Buildings
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4.65
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Machinery
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14.70
|
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Miscellaneous Assets
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1.00
|
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Preliminary and Pre-operative Expenses
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1.50
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Contingencies @ 10% on land and
building and machinery
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1.95
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Working Capital Margin
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2.65
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Total
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26.45
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Means of Finance
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|
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Promoter's Contribution
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7.15
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Term Loan from Bank/FI
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19.30
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Total
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26.45
|
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Debt Equity Ratio
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2.70 : 1
|
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Promoters' Contribution
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27%
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|
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Financial assistance in the form of grant
is available from the Ministry of Food Processing Industries, Govt. of India,
towards expenditure on technical civil works and plant and machinery for
eligible projects subject to certain terms and conditions.
As against the rated capacity, actual
utilisation in the first year is assumed to be 60% and thereafter, it is
restricted to 75%.
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9.2 Sales Revenue at 100% (Rs. in lacs)
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|
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9.3 Raw and Packing Materials Required
at 100% (Rs. in lacs)
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Annual expenditure on utilities at 100% activity level
is expected to be Rs. 1.50 lacs.
A provision of 15% of sales every year would take care of transportation, commission etc. as this
is an industrial product.
Interest on term loan of Rs. 19.30 lacs is calculated @ 12% per annum assuming complete repayment
in 5 years including a moratorium period of 1 year whereas on working capital
from bank, it is computed @ 14% per annum.
It is computed on WDV basis and rates assumed are 10% on building and 20% on machinery and
miscellaneous assets.
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(Rs. in lacs)
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No.
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Particulars
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Amount
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|
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A
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Sales
|
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65.25
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B
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Variable Cost
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|
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Raw and Packing Materials
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36.00
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|
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Utilities (70%)
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0.78
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|
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Salaries (70%)
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1.58
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|
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Repairs and Maintenance
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0.60
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|
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Selling Expenses (70%)
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6.85
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|
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Administrative Expenses (50%)
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0.50
|
|
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Interest on working capital
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1.05
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47.36
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C
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Contribution (A-B)
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17.89
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D.
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Fixed Cost
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9.75
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E.
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Break-Even Point (D C)
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54%
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Financial leverage
= EBIT/EBT = 14.68 - 4.47 = 3.28
Operating Leverage = Contribution/EBT = 17.89 - 4.47 = 4.00
Degree of Total Leverage = FL/OL = 3.28 - 4.00 = 0.82
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[B] Debt Service Coverage Ratio
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Cost of the project is Rs. 26.45 lacs
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(Rs. in lacs)
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The IRR is around 23%.
1.
Flour Tech Engineers Pvt Ltd, 16/5,
Mathura Road, Faridabad 121 002 Tel. No.: 2263017, 2291556, Fax: 2291556
2.
Flavourite Foods & Services Pvt. Ltd, 208 Manas Bhavan, 11, RNT Marg, Indore 452 008 Tel. No. :
2527644, 5046509, Fax: 5040953
3.
FMC Technologies Hong Kong Ltd, 2
Bhuvaneshwar Housing Soc,
Pashan Road, Pune 411 008 Tel. No. :
5893700, Fax: 5893701
4.
SS Engineering, B-24, Khanpur Extension, New Delhi 110 062, Ph: 26081475, 9810217935
5.
Sahyog Steel Fabrication, 28 Bhojrajpara,
Gondal 360 311 Tel. No. : 224075, Fax: 231375
6.
Cowel Can Ltd, Industrial area, Post
Barotiwala, Dist. Solan (HP)
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