Profile No.

: 107 NIC Code: 30204

BRAKE DRUMS

1. INTRODUCTION:

Most rotating machines including automobiles require control of motion with the help of
brakes. Drum brake is a brake that uses friction caused by a set of shoes or pads that press
and grip the rotating cylinder-shaped part called a brake drum. Lifting machines and other
heavy earth moving machines also use drum brakes as they are very safe and secure in
operation.

It is recommended to take up manufacture of brake drums and other components by

entrepreneurs.

2. PRODUCT & ITS APPLICATION:

The term drum brake usually means a brake in which shoes press on the inner surface of the
drum. When shoes press on the outside of the drum, it is usually called a clasp brake. Drum
brakes are mostly used to achieve compact and light weight construction in automobiles for
speed control.

Advantages of drum brakes:

 less expensive to produce
 Lower frequency of maintenance due to better corrosion resistance compared to disks.
 Built-in self-energizing effect requires less input force (such as hydraulic pressure).
 Wheel cylinders are somewhat simpler to recondition compared to calipers.
 Minor weight savings, primarily from much smaller and lighter hydraulic cylinders vs.
calipers.
Brake drums are mostly made of cast iron to fit in to wheel rim housing. Drum brake
components include the backing plate, brake drum, shoe, wheel cylinder, and various springs
and pins.

3. DESIRED QUALIFICATIONS FOR PROMOTER:

The promoter with experience of foundry metal casting and auto component trading with
mechanical / metallurgical engineering background will be suitable for the project.

4. INDUSTRY OUTLOOK/TREND

Brake Drum are essential component for automobiles and other large capacity mobile engines
viz earth moving machine, material handling machines as well as marine engines. Being part of
the auto component industry, the outlook for this product relates with the Indian auto-
components industry that has experienced healthy growth over the last two decades.

There are more than 230 manufacturers of brake drums for auto as well as industrial and
material handling equipment spread all around India. Most of the manufacturers are clustered
around the major auto Hubs like Delhi to Punjab, Chennai – Coimbatore - Bangaluru, Bombay
– Pune - Ahmednagar, Ahmedabad - Rajkot regions. Some of these are OEM suppliers and
most of them are present in replacement markets. Most of the units are specializing in specific
auto model ranges of Motorcycles, scooters, Cars, LCV, HCV, Tractors, earth movers, Forklifts,
Traveling cranes, Hoists, etc.

There are no major technology changes except material compositions of metals viz Cast Iron/
Bronze, etc.

5. MARKET POTENTIAL AND MARKETING ISSUES. IF ANY:

All auto vehicles use brake drums fitted with their wheel rims/ axles. The automotive industry
in India is one of the largest in the world with an annual production of 23.96 million vehicles in
2015–16. The Indian automotive aftermarket is expected to grow at a CAGR of 10.5 per cent
and reach Rs 75,705 crore (US$ 13 billion) by the year 2019-20, according to the Automotive
Component Manufacturers Association of India (ACMA).

The auto-component industry of India has expanded by 14.3 per cent because of strong
growth in the spares or after-market sales to reach at a level of Rs 2.92 lakh crore (US$ 44.90
billion) in the year 2017. The sales of passenger vehicles, commercial vehicles and two
wheeler grew by 9.23 per cent, 4.16 per cent and 6.89 per cent respectively, during the period
April-March 2017. This indicates the scope for brake drum demand for new vehicles as also
for the aftermarket demand though is reflect small volume.

In view of the strong growth of domestic spares market as well as export market of the
components, there is scope for Indian units to grow in coming decades. The Two Wheeler
segment, with 81 per cent market share, is the leader of the Indian Automobile market; and it
is growing steadily due to a growing middle class and a young population. Moreover, the
Indian two wheeler companies are exporting to African and Latin American markets and also
emerging as a leading exporter.

In view of this, though there are many competitors, there is very good scope for Brake drums
and related auto components for domestic and export potential.

6. RAW MATERIAL REQUIREMENTS:

Brake drums are most made from cast iron. The main raw material is cast iron scrap and pig
iron.

7. MANUFACTURING PROCESS:

The brake drum is generally made of a special type of cast iron that is heat-conductive and
wear-resistant. It rotates with the wheel and axle. This braking friction generates substantial
heat. The main activity involved is to cast the metal of suitable grade and machining to
specifications.
8. MANPOWER REQUIREMENT:

The unit shall require highly skilled service persons. The unit can start from 6 employees
initially and increase to 18 or more depending on business volume.

Monthly
Sr No Type of Employees No of Employees
Salary

Year 1 Year 2 Year 3 Year 4 Year 5

Variable Labour/ Workers :

1 Skilled Operators 15000 2 2 3 3 3

2 Semi-Skilled/ Helpers 8000 4 6 6 9 12

Subtotal : 6 8 9 12 15

Fixed Staff

1 Supervisor/ Manager 25000 0 0 1 1 1

2 Accounts/ Marketing 15000 0 0 1 1 1

3 Other Staff 7000 0 0 1 1 1

Subtotal : 0 0 3 3 3

TOTAL 6 8 12 15 18

9. IMPLEMENTATION SCHEDULE:

The unit can be implemented within 3 months from the serious initiation of project work.

Sr No Activities Time Required in Months

1 Acquisition of Premises -

2 Construction (if Applicable) -

3 Procurement and Installation of Plant and Machinery 2

4 Arrangement of Finance 2

5 Manpower Recruitment and start up 1

Total Time Required (Some Activities run

3
concurrently)
10. COST OF PROJECT:

The unit will require total project cost of Rs 24.26 lakhs as shown below:

Sr. No Particulars In Lakhs

1 Land 0.00

2 Building 0.00

3 Plant and Machinery 13.75

4 Fixtures and Electrical Installation 2.10

5 Other Assets/ Preliminary and Preoperative Expenses 1.50

6 Margin for working Capital 6.91

TOTAL PROJECT COST 24.26

11. MEANS OF FINANCE:

The project will require promoter to invest about Rs 11.25 lakhs and seek bank loans of Rs
13.01 lakhs based on 70% loan on fixed assets.

Sr. No Particulars In Lakhs

1 Promoters Contribution 11.25

2 Loan Finance 13.01
TOTAL : 24.26
12. WORKING CAPITAL REQUIREMENTS:

Working capital requirements are calculated as below:

Sr No Particulars Gross Amount Margin % Margin Amount Bank Finance

1 Inventories 3.87 40 1.55 2.32

2 Receivables 5.06 50 2.53 2.53

3 Overheads 1.28 100 1.28 0.00

4 Creditors 3.87 40 1.55 2.32

TOTAL 14.08 6.91 7.17

13. LIST OF MACHINERY REQUIRED:

Sr. No Particulars UOM Quantity Rate Total Value

Main Machines/ Equipment

Induction Melting Furnace for cast iron
1 Nos 1 400000 400000
alloys
2 Centrifugal Casting machines Nos 2 60000 120000
3 Pin Lift Molding Machine 2 60000 120000
4 Sand Mixer, sieves etc. Nos 1 80000 80000
5 Shot blasting machine 1 80000 80000
6 Lathe Machine 3 100000 300000
7 Drilling Machine 1 65000 65000
8 Bench/ Flexible shaft grinders 2 30000 60000

subtotal : 1225000

Tools and Ancillaries

1 Patterns tools and gauges LS 1 50000 50000
2 Mold boxes , Misc. tools etc. LS 1 100000 100000

subtotal : 150000

Fixtures and Elect Installation

Storage racks and trolleys LS 1 15000 15000
Other Furniture LS 1 20000 20000
 Telephones/ Computer LS 1 25000 25000
Electrical Installation LS 1 150000 150000
subtotal : 210000
Other Assets/ Preliminary and Preoperative
LS 1 150000 150000
Expenses

TOTAL PLANT MACHINERY COST 1735000

All the machines and equipment are available from local manufacturers. The entrepreneur
needs to ensure proper selection of product mix and proper type of machines and tooling to
have modern and flexible designs. It may be worthwhile to look at reconditioned imported
machines, dies and tooling. Some of the machinery and dies and tooling suppliers are listed
here below:

1. Balaji Engineers
No. 122, Vishala Industrial Estate, Near Odhav Ring Road Chokdi Near Kathwada G. I.
D. C., Odhav, Odhav Industrial Estate, Ahmedabad -382415, Gujarat, India

2. Eddy Melt
C 70, M. I. D. C., Hingna Industrial Estate, Nagpur - 440025
Maharashtra, India

3. Electrotherm India Ltd.,

Survey No. 72, Village Palodia, Taluka Kalol Via Thaltej
Ahmedabad- 382115, Gujarat, India

4. Micro Engineering Works;

No. 6/140, Gandhi Nagar, Nallampalayam Road Nanjai Gounden, Pudur, G. N. Mills
Post, Coimbatore - 641029, Tamil Nadu, India

5. Gautam Industries
Plot No. 267, Near Upvan Lake, Upvan
Thane - 400606
Maharashtra, India
Other well known machine manufacturers can be searched from directories/ internet. Some
are listed here below:

ACME TOOLINGS, D-67, Phase 1, IDA Jeedimetla, Hyderabad – 500055,

Ace Manufacturing Systems Ltd., Batliboi Ltd. Mumbai, Bharat Fritz Werner Ltd., HMT
Machine Tools Ltd., Advani Oerlikon Ltd, Bombay, Lakshmi Machine Works Ltd., Lokesh
Machines Ltd., Praga Tools Ltd., Toolcraft Systems Pvt. Ltd.

The above list of machine supplier is illustrative. There are many machinery, dies and tools
suppliers and consultants at several industrial clusters all over India where you may find
suppliers of services and machinery for a chosen product mix. Other well known machine
manufacturers can be searched from directories/ internet.

14. PROFITABILITY CALCULATIONS:

Sr. No Particulars UOM Year Wise estimates

Year 1 Year 2 Year 3 Year 4 Year 5

1 Capacity Utilization % 35 45 60 70 80

2 Sales Rs Lakhs 60.74 78.09 104.12 121.48 138.83

Raw Materials & Other Direct

3 Rs Lakhs 46.40 59.66 79.55 92.80 106.06
Inputs

4 Gross Margin Rs Lakhs 14.34 18.43 24.58 28.67 32.77

5 Overheads Except Interest Rs Lakhs 13.59 13.59 13.59 13.59 13.59

6 Interest Rs Lakhs 1.82 1.82 1.82 1.82 1.82

7 Depreciation Rs Lakhs 1.74 1.74 1.74 1.74 1.74

8 Net Profit Before Tax Rs Lakhs -2.81 1.29 7.43 11.53 15.62

The basis of profitability calculation:

The Unit will have capacity of 300 MT of Brake Drums and allied products per year of assorted
types/ designs. The sales prices of Brake of various types range from Rs 35 to Rs 150 per Kg
or more depending on type, metal composition, and volumes. The raw material cost of CI
 scrap is ranges from 25 to 35 per Kg depending on grades. The material requirements are
considered with wastage/ scrap/burnouts etc. of 4 % of finished products as most of
generated scrap is reused. The unusable scrap is sold at @ Rs 15 ~ 18 per Kg. and the income
of same is added. Energy Costs are considered at Rs 7 per Kwh and fuel cost is considered at
Rs. 65 per liter. The depreciation of plant is taken at 10 % and Interest costs are taken at 14
-15 % depending on type of industry.

15. BREAK EVEN ANALYSIS

The project is can reach break-even capacity at 41.86 % of the installed capacity as depicted
here below:

Sr. No Particulars UOM Value

1 Sales at Full Capacity Rs Lakhs 173.54

2 Variable Costs Rs Lakhs 132.58
3 Fixed Cost incl. Interest Rs Lakhs 17.15

4 Break Even Capacity % of Inst Capacity 41.86

16. STATUTORY/ GOVERNMENT APPROVALS

The unit will require state industry unit registration with District Industry center. No other
procedures are involved. For export, IEC Code and local authority clearances. The industry
registration and approval for factory plan, safety etc. are required as per factory inspectorate
and labor laws. Other registration are as per Labor laws are ESI, PF etc. Before starting the
unit unit will also need GST registration for procurement of materials as also for sale of goods.
As such there is no pollution control registration requirement, however the unit will have to
ensure safe environment through installation of chimney etc as per rules. Solid waste disposal
shall have to meet the required norms.

17. BACKWARD AND FORWARD INTEGRATION

The machines and equipment offer scope for diversification in to producing other consumer
and industrial parts/ components viz cast iron hydraulic / pneumatic cylinders for brakes and
 other components, parts for heavy machinery of construction, earth moving, mining structural
tubes etc. The unit can add few machines to produce normal sand castings, etc by using the
spare capacities of furnace and machining capabilities. As such there is not much scope for
organic backward or forward integration.

18. TRAINING CENTERS/COURSES

There are no specific training centers for production technology. However foundry technology
training can be obtained by joining as apprentice in foundry units. The Prototype Development
Centers can provide some assistance for casting/metallurgy for dies and Tools development,
courses run by centers of excellence viz Indo German Tool Room at Ahmedabad, Rajkot,
Chennai, etc shall be helpful.

The most important scope of learning is in new product design and development by study of
the new product designs, product range, features and specifications of leading Brands /
competitors across the world by scanning the Internet and downloading data from websites of
Viz. North American, Europe, China etc markets.

Udyamimitra portal (link: www.udyamimitra.in) can also be accessed for hand-holding services
viz. application filling / project report preparation, EDP, financial Training, Skill Development,
mentoring etc.
Entrepreneurship program helps to run business successfully is also available from Institutes
like Entrepreneurship Development Institute of India (EDII) and its affiliates all over India.

Disclaimer:
Only few machine manufacturers are mentioned in the profile, although many machine
manufacturers are available in the market. The addresses given for machinery manufacturers
have been taken from reliable sources, to the best of knowledge and contacts. However, no
responsibility is admitted, in case any inadvertent error or incorrectness is noticed therein.
Further the same have been given by way of information only and do not carry any
recommendation.