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Cost Estimation
Estimation of Capital Investment
A detailed estimate is carried out based on the current data available.
The Break down of Fixed Capital Investment items are detailed as follows.
1) Purchased Equipment
S. No.
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
Equip. Name
RE
RFE
WFE
36" Centrifuge
24" Centrifuge
24" Centrifuge GMP
SS316 Reactor 5.0KL
SS304 Reactor 1.2KL
SS304 Reactor 630lts
SS304 Reactor 300lts
SS304 Reactor 150lts
SS304 ST 4.0KL
SS304 HE 6m2
SS304 ST 7.0KL
SS304 ST 1.0KL
SS304 ST 500lts
SS304 Steam pan 150lts
SS304 HE 10m2
SS304 H Receiver 300lts
SS304 P Tank 200lts
SS304 Receiver 200lts
SS304 HE 2m2
SS304 ST 500lts
Nos.
1
1
1
1
1
1
1
2
2
3
1
1
9
2
1
2
1
1
1
1
10
8
3
Price in Rs.
654,300
570,000
458,010
274,806
196,290
412,209
536,735
348,088
238,165
404,357
117,774
78,516
288,546
236,857
35,332
67,262
20,934
52,344
18,059
12,432
124,317
136,095
96,182
6,196,531
S. No.
24
25
26
27
28
29
30
31
32
33
34
Equip. Name
SS304 Receiver 100lts
SS304 Receiver 75lts
SS304 Stand
MS ST 6.0KL
MS ST 500lts
SS304 VTD 24 Trays
SS304 GMP VTD-24T
SS304 Multi Mill GMP
SS304 MM GMP R&D
SS304 Candle Filters
SS304 Receiver 250lts
Nos.
3
1
1
2
2
1
1
1
1
2
1
Price in Rs.
29,836
7,852
9,160
70,664
25,518
257,139
310,793
39,258
22,900
26,172
19,629
1549132.75
Description
Pressure Gauge 0-7kg/cm2
Pressure Gauge 0-10kg/cm2
Temp. Gauge 4-50 deg C
Vacuum Gauge 0-760mm Hg
Water Flow Switch
U syphon & Cock
Safety Valves
Temp. Controller
Temp. Indicator
PID Controller
FLP Temp. Scanner
2/2 Pheumatic P.O valve
Nos.
44
7
6
21
1
55
8
3
8
1
2
4
Price in Rs.
11,918
2,184
8,206
5,897
1,352
4,576
2,080
8,486
38,896
18,252
26,343
62,400
190,590
4) Piping
a) Process Piping
S. No.
1
2
3
4
Description
MS Pipes (all sizes)
SS Pipes (all sizes)
PVC Pipes and Fittings
GI Pipes
1,198,253
S. No.
Description
Description
H Beams, Channels, Angles, Checkered Plates etc.
MS Flanges E-type
MS Dummy/Blind Flanges E-type
MS Short Bends
MS Long Bends
MS Threaded Nipples
MS Ball Valve
Gun Metal Steam Valves
MS Ball Valve E-type
MS T
MS Reducer
MS GI Coated Nuts & Bolts
GI U Clamps
Spirax Steam Trap 3/4"
Gun Metal Steam Traps 3/4"
Anchor Bolts
MS Couplings
MS Foundation Bolts
PVC Foot Valve 3"
Packing Sheet Non Metallic 3mm thick
CI Butterfly Valves
CI Y-Strainer E-type
Non Return Valves (Vertical type)
4'x6'x2.5mm thick MS Sheet
SS 316 S40 Short Bends
SS 316 S40 Threaded Nipples
SS 304 Flanges E-type
SS 316 S40 T
SS 304 Ball Valves E-type
SS 304 Flush Bottom Valves
SS 316 S40 Reducer
SS 304 Couplings
SS 304 Ball Valves
SS 316 View Glass
SS 304 Dummy Flanges E-type
SS 316 Welding Rods ESAB 308
GI Flat 25x6mm
Teflon Tape
MS welding rods
SANT C3 PRV Valve 40mm
SANT Bronze PRV S/E 1"
ESAB Tig Rod 16.30 SS316
CI Ball Valves 3/4"
MS Dummy Plugs 3/8"
GI T
GI Long Bends
Nos.
Price in Rs.
16,550kgs
558,563
1579
182,047
85
12,926
626
35,325
40
1,575
282
17,910
172
135,450
25
33,750
10
11,250
8
180
49
6,818
495kgs
21,718
10kgs
225
10
24,470
12
27,000
170
1,530
146
1,800
16
1,040
3
506
73.5kgs
5,374
17
37,800
9
16,875
15
15,700
140kgs
3,938
249
111,787
165
23,186
934
174,994
52
7,054
6
31,500
6
33,750
141
63,562
10
562
157
248,200
22
34,200
49
7,627
10
22,500
477.8kgs
14,675
100
3,150
1
208
1
14,625
1
12,375
35kgs
19,687
16
9,000
20
225
60
1,969
101
2,576
S. No.
47
48
49
50
51
52
53
54
55
Description
GI Union
GI Dummy Plugs
GI Threaded Nipple
Hold tite
GI Coupling
PDSPSA102A Float Trap 1"
PDSPSA204A Y-type S/E Strainer
14"x14" CI Man holes
GI U Clamps
Nos.
Price in Rs.
35
2,137
4
67
155
6,806
500gms
113
48
945
4
27,000
4
11,250
10
7,875
Lumpsum
563
2,047,938
Description
Nos.
Price in Rs.
Mineral Wool
40bags
36,000
GI Mesh
8 Rolls
4,500
GI Wire
15kgs
506
Sheet metal screws
10pkts
563
Bitumen 85/25
110kgs
24,750
GI Sheets 24gauge
109kgs
7,357
Aluminium Coil 24gx3' 772kgs
156,330
Thermocol Pipes
1500mts
135,000
365,006
3,611,197
Description
Panel Boards
Electrical Access. In panel boards
Lighting, lamps, tubes & Gen. Fitting
FLP Light Fittings
FLP RV lamps on-off switch type
FLP Push button station on-off type
Armoured Cable
FCG' well glass 2x25W FLP lights
FCG make bulk head fitting
120x3mm copper flat
FLP Glands
320 wire (Fine cab)
Exhaust Fan (FLP)
Fresh Air Fan (NFLP)
Galvanized Perforated Cable Trays
Nut Bolt Washers
Zeuzer Pumps(2.0hp)(Double M.Seal
CG 5.0HP Monobloc pumpset
CG 7.5HP Monobloc pumpset
CG 3.0HP Monobloc pumpset
Twin screw pump 1.0HP (Tushaco)
Twin screw pump 1.5HP (Tushaco)
Kirloskar 3.0HP Monobloc pumpset
CG 7.5HP FLP Motor
CG 1.0HP FLP Motor
CG 1.0HP NFLP Motor
CG 2.0HP FLP Motor
Centrifugal process pumps 1.0HP
Centrifugal process pumps 2.0HP
High Vacuum Pump 5.0HP
Nos.
5
Lumpsum
Lumpsum
10
12
30
4275mts
2
2
14.2kgs
200
15coils
3
3
125mts
320sets
2
6
3
2
1
1
1
1
7
4
2
11
2
1
3,320,927
Price in Rs.
281,250
112,500
168,750
56,250
60,750
20,250
1,715,625
225
2,250
799
3,937
8,438
15,750
4,500
45,000
337
104,000
124,800
78,000
35,360
89,278
89,278
15,600
27,480
109,200
54,080
41,600
28,600
6,240
20,800
Description
Labor of Excavation
Labor for Electrical wiring
Nos.
Lumpsum
Lumpsum
Price in Rs.
2,250
112,500
114,750
3,435,677
4,000,000
b) Auxiliary Buildings
Total Price incurred in Auxiliary buildings
c) Maintenance Shops
Total Price incurred in Maintenance Shops
d) Building Services
S.No.
Description
1
Plumbing work (labor charges)
2
Air Handling Units (HVAC)
3
Paint Material
4
Labor charges for painting
Nos.
Lumpsum
2
Lumpsum
Lumpsum
Price in Rs.
15,000
337,500
10,912
20,000
383,412
4,383,412
7) Yard Improvements
Site Development - site clearing, grading, roads, walkways etc.
S. No.
1
2
3
4
Description
Site Clearing
Roads
Walkways
Landscaping
Nos.
Lumpsum
Lumpsum
Lumpsum
Lumpsum
Price in Rs.
10,000
30,000
15,000
15,000
70,000
8) Service Facilitites
a & b) Utilities and Facilities
S. No.
1
2
3
4
5
6
7
8
9
10
11
12
Description
Borewell and Pumpset
POLYSTOL HDPE tanks
Distribution Transformer 400KVA
24TR aircooled packaged chiller
SS water jet vacuum system
70KVA kirloskar make generator
ELGI air cooled Air Compressor
1.0HP monobloc vacuum pumps
Heating bath and Accessories
Cold rooms with panels
SS304 Pass box
Cooling Towers
Nos.
Lumpsum
2
1
1
5
1
1
2
1
2
2
2
Price in Rs.
50,000
10,125
302,550
489,375
84,375
168,750
22,500
16,875
33,750
587,650
45,000
78,750
1,889,700
Description
FC 1800 FRP Fume Chamber and base
Pharma Room Doors (Steel Doors)
Doors and Windows
Granite
Labor charges for laying granite
Glazed Tiles
Labor charges for laying tiles
Fire Extinguishers
Miscellaneous Laboratory Equipment
Office furniture and equipment
Nos.
1
2
Lumpsum
3000sft
3000sft
2000sft
2000sft
3
Lumpsum
Lumpsum
Price in Rs.
165,877
47,250
50,000
151,875
54,000
45,000
16,000
33,750
225,000
33,750
822,502
2,712,202
247861.24
Description
Purchased Equipment
Purchased Equipment Installation
Instrumentation and Controls
Piping
Electrical Equipment and Materials
Buildings (Including services)
Yard Improvements
Service Facilities
Land
Indirect Costs
1) Engineering and Supervision
Total Engineering and Supervision cost is taken as 8% of the Total Direct Cost
1791728.239
1567762.209
1119830.15
2337036.834
2) Construction Expenses
Total Construction Expenses cost is taken as 7% of the Total Direct Cost
3) Contractor's Fee
Total Contractor's fee is taken as 5% of the Total Direct Cost
4) Contingency
Total Contingency cost is taken as 8% of the Total Direct and Indirect cost
Description
Engineering and Supervision
Construction Expenses
Contractor's Fee
Contingency
6816357.43173913
29,212,960
5155228.30971867
34368188.7314578
Cost in Rs.
Cost in Rs.
Cost in Rs.
6,196,531
1549132.75
190,590
3,611,197
3,435,677
4,383,412
70,000
2,712,202
247861.24
22,396,603
1791728.2392
1567762.2093
1119830.1495
2337036.83373913
6816357.43173913
29,212,960
5155228.30971867
34368188.7314578
Cost in Rs.
Cost in Rs.
Cost in Rs.
11250000
1404000
1164000
3156000
185895.93
27884.3895
280800
0
5471250
22939830.3195
4513446.42326087
292129.604217391
292129.604217391
0
5097705.63169565
826168.779
826168.779
28863704.7301956
351000
3246078.30335507
0
0
3597078.30335507
32460783.0335507
2,400
Manufacturing Costs
1) Direct Production Costs
a) Raw Materials
S. No.
Description
1
Duboisia Leaves
11250000
b) Operating Labor
S. No.
Description
1
Skilled Labor
2
Unskilled Labor
3
Watch men
No, Required
30
10
6
1404000
c) Operating Supervision
S. No.
1
2
3
4
Description
In-charge
Supervisor - Plant
Supervisor - Stores
Supervisor - Maint.
No, Required
3
6
1
1
No. of Units/year
2,15,205Kg
3,60,000KWH
4,320m3
3156000
185895.93
f) Operating Supplies
Annual cost of operating supplies is assumed as 15% of
the Total cost of Maintenance and Repairs
27884.3895
g) Laboratory Charges
Annual cost of laboratory charges is assumed as 20% of
the Total cost of Operating Labor
280800
Description
Methanol, Lts
D.M.Water, Lts
Hydrochloric Acid, Lts
Chloroform, Lts
Ammonia, Lts
n-Butylbromide, Lts
Acetonitrile, Lts
Activated Charcoal, Kgs
Hyflow, Kgs
Description
Raw Materials
Operating Labor
Operating Supervision
Power and Utilities
Maintenance and Repairs
Operating Supplies
Laboratory Charges
Patents & Royalties
Catalysts and Solvents
2) Fixed Charges
a) Depreciation
i) Annual cost of Depreciation for Machinery and Equipment is
assumed as 10% of the Fixed Capital Investment
2921296
131502
1460648
292130
292130
826169
b) Taxes
Annual property taxes for plant is assumed as 1% of the
Fixed Capital Investment
c) Insurance
Annual cost of Insurance is assumed as 1% of the
Fixed Capital Investment
d) Rent
Annual cost of Rent for Land and Buildings
Total Annual Fixed Charges
S. No.
1
2
3
4
Description
Depreciation
Taxes
Insurance
Rent
5097705.63169565
Description
Direct Production Cost
Fixed Charges
Plant Overhead Costs
General Expenses
1) Administrative Expenses
Annual cost of Administrative expenses is assumed as 25% of
the total cost of operating labor
351000
3246078
Description
Administrative Expenses
Distribution and Marketing Expenses
Research and Development
Financing (interest)
3597078.30335507
32460783.0335507
Profitability Analysis
To Calculate Profitability Analysis two methods have been employed.
Method 1 : Based on Fixed Known Selling Price of the Finished Product API at 75% Capacity
Method 2 : Based on Selling Price of the Finished Product API calculated at 100%, 75% & 50% Capacity.
Method - 1
Revenue Through sales
At present the market value of the Finished Product API manufactured under this
facility per Kg
Annual Revenue through sales at 75% capacity
Gross Profit
Gross Profit
= 57539216.96645
Net Profit
20
46031373.57316
0.578 years
Rate of Return
Rate of Return
Rate of Return
158 %
50,000
90000000
Method - 2
Product Unit Cost
The Total Product Cost estimated in the facility is, Rs.
=
This amount should be compensated by the annual sales of the Product
The Unit Cost per Kg of the Finished Product API
13525.33 per Kg
16 %
17,817,407
= 4674073.667
Average Depreciation / Year
where Number of years
10
= 2921296.042
Pay Back Period
2.346 years
Contd
1
50
2
75
3
100
4
100
5
100
6
100
7
100
8
100
9
100
10
100
Sum
1.2
1.8
2.4
2.4
2.4
2.4
2.4
2.4
2.4
2.4
22.2
16.23 24.35 32.461 32.461 32.461 32.461 32.461 32.461 32.461 32.461 300.262
5.0075 5.008 5.0075 5.0075 5.0075 5.0075 5.0075 5.0075 5.0075 5.0075 50.0751
2.9213 2.921 2.9213 2.9213 2.9213 2.9213 2.9213 2.9213 2.9213 2.9213
40.39
40.39
40.39
40.39
40.39
29.213
379.55
1
75
2
75
3
75
4
75
5
75
6
75
7
75
8
75
9
75
10
75
Sum
1.8
1.8
1.8
1.8
1.8
1.8
1.8
1.8
1.8
1.8
18
24.346 24.35 24.346 24.346 24.346 24.346 24.346 24.346 24.346 24.346 243.456
5.0075 5.008 5.0075 5.0075 5.0075 5.0075 5.0075 5.0075 5.0075 5.0075 50.0751
2.9213 2.921 2.9213 2.9213 2.9213 2.9213 2.9213 2.9213 2.9213 2.9213
29.213
2
50
3
50
4
50
5
50
6
50
7
50
8
50
9
50
10
50
Sum
1
50
1.2
1.2
1.2
1.2
1.2
1.2
1.2
1.2
1.2
1.2
12
16.23
16.23
16.23
16.23
16.23
16.23
16.23
16.23 16.23
5.0075 5.008 5.0075 5.0075 5.0075 5.0075 5.0075 5.0075 5.0075 5.0075 50.0751
2.9213 2.921 2.9213 2.9213 2.9213 2.9213 2.9213 2.9213 2.9213 2.9213
16.23 162.304
29.213
2921296
The Unit Selling Price of the Finished Product API at 100% capactiy is
Therefore, Average Net Profit per year
9531876
22463.91
2921296
The Unit Selling Price of the Finished Product API at 100% capactiy is
Therefore, Average Net Profit per year
9531876
24549.57
2921296
The Unit Selling Price of the Finished Product API at 100% capactiy is
Therefore, Average Net Profit per year
9531876
100
22463.91
75
24549.57
50
30061.7
30061.7
References :
1) Plant Design and Economics for Chemical Engineers, 5/e by Max S. Peters, University of
Colorado, Klaus Timmerhaus, University of Colorado, Boulder, Ronald E. West, University
of Colorado, Boulder.
2) Data Available from my Professional Experience in a Bulk Drug Pharmaceutical Industry
3) Chemical Engineering Resources, website, http://www.cheresources.com
4) Profitability Analysis, websit, http://odellion.com
Note :
1 USD = Rs.45.00 (Approx)