Detailed Project Report on Cigarette Manufacturing Unit

CIGARETTE MANUFACTURING UNIT

[EIRI/EDPR/1406] J.C. 182, 537US$, 572

INTRODUCTION

Cigarette consumption in India in 2010-11 reached 102 billion sticks, down from a peak of 109 billion sticks in 2006-07.

Fewer than 6% of the adult population smoke cigarettes, representing a very small constituent of tobacco users in the country.

Despite accounting for just 15% of tobacco consumption, cigarettes contribute 75% of total tobacco tax revenues, a situation that continues to create difficulties for the growth of the segment.

Three major cigarette companies account for around 98% of legitimate domestic cigarette sales. But, as in other nations slapping high taxes on cigarettes, India has recently been forced to face the fact that an increasing number of illicit, tax-unpaid products are finding their way into the market.

Commercial tobacco is obtained by processing the leaves of plant genus NICOTIANNA. The processed leaves when smoked, hewed or in halted exert a mild narcotic effect on the human system, which is addictive. Tobacco products fall under three categories:- smoking, chewing and inhaling. Cigarettes, bidis, cigars, pipe and hookah tobacco is the products which are smoked. There are various types of preparations which are chewed. Shuff is the product which is inhaled.

The varieties of tobacco which are called desi-type have tall plants with broad long leaves and usually plants with pink flower. Rustlca variety known as vilayati and Kolkata have short plants with round puckered leaves and yellow flowers. Specific varieties in talcum species have been developed for cigarette, cigar, bidi, hookah, and chewing and shuff tobacco. The varieties developed in rustical species are used only for hookah chewing and shuff. They are not suitable for use in cigarettes, bidis or cigars.

COST ESTIMATION

Plant Capacity      1 Million Sticks/Day  

Land & Building (4000 sq.mt.)    Rs. 5.60 Cr    

Plant & Machinery                    Rs. 5.64 Cr 

Working Capital for 2 Months    Rs. 3.92 Cr 

Total Capital Investment          Rs. 16.24 Cr 

Rate of Return                          42%

Break Even Point                      43%

CONTENTS

INTRODUCTION

RAW MATERIAL

BIS SPECIFICATION

MARKET POSITION

TOBACCO BOARD

THE CIGARETTE INDUSTRY IN INDIA

MARKET SHARE:

FINANCIALS

TOP CIGARETTES BRANDS IN INDIA

CIGARETTE MANUFACTURERS IN INDIA

CLASSIFICATION OF INDUSTRY

RESEARCH METHODOLOGY

MARKETING & MERCHANDISING SERVICES OFFERED TO MARKET CIGARETTES

LICENCING REQUIREMENT AND THEIR DEPARTMENT

MANUFACTURING PROCESS

DETAILS OF MANUFACTURING PROCESS

MAIN STEP IN THE MANUFACTURING PROCESS OF CIGARETTE

PROCESS FLOW DIAGRAM

METHODS FOR MANUFACTURING CIGARETTES

PLANT LAYOUT FOR CIGARETTES

SUPPLIERS OF COMPLETE CIGARETTE

PRODUCTION PLANT & EQUIPMENT

SUPPLIERS OF RAW MATERIALS

APPENDIX – A:

01. PLANT ECONOMICS

02. LAND & BUILDING

03. PLANT AND MACHINERY

04. OTHER FIXED ASSESTS

05. FIXED CAPITAL

06. RAW MATERIAL

07. SALARY AND WAGES

08. UTILITIES AND OVERHEADS

09. TOTAL WORKING CAPITAL

10. TOTAL CAPITAL INVESTMENT

11. COST OF PRODUCTION

12. TURN OVER/ANNUM

13. BREAK EVEN POINT

14. RESOURCES FOR FINANCE

15. INSTALMENT PAYABLE IN 5 YEARS

16. DEPRECIATION CHART FOR 5 YEARS

17. PROFIT ANALYSIS FOR 5 YEARS

18. PROJECTED BALANCE SHEET FOR (5 YEARS)