Indicative ₹5 Lakh financing for a agarbatti manufacturing + a full bank-ready report with CMA data, DSCR ≥ 1.50 and 5-year projections.
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If you are planning to start an agarbatti manufacturing unit in India with a loan of ₹5 lakh, this project report is your essential tool for bank approval. Designed for entrepreneurs and CAs, it covers the complete financials for a unit under NIC code 32909. The project cost is ₹5 lakh, with a promoter margin of ₹50,000 (10%) and a term loan of ₹4.5 lakh. At an interest rate of 11% per annum over 7 years, the monthly EMI works out to approximately ₹7,705. This report includes a CMA (Credit Monitoring Arrangement) data sheet, DSCR (Debt Service Coverage Ratio) analysis, and 5-year financial projections. It is aligned with government schemes such as PMEGP (subsidy up to 35%), MUDRA Kishor (loan up to ₹5 lakh), and PM Vishwakarma (which offers collateral-free credit up to ₹1 lakh for traditional artisans). The report demonstrates viability by showing projected gross profit margins of 25-30%, break-even within 18 months, and a DSCR above 1.5. It also lists required documents, machinery specifications, and raw material sourcing tips. Whether you are in Uttar Pradesh, Maharashtra, or any state, this report will help you secure a bank loan quickly.
To qualify for a ₹5 lakh agarbatti manufacturing loan under PMEGP, MUDRA Kishor, or PM Vishwakarma, you must meet these criteria: Indian citizen aged 18+; for PMEGP, minimum 8th pass (relaxable for rural areas); no default on previous loans; project should be new (not expansion). Under MUDRA Kishor, the loan is for non-farm income-generating activities. PM Vishwakarma is for traditional artisans with a family occupation in agarbatti making. Banks also require a viable project report with 5-year projections, DSCR >1.25, and margin money of 10-15%. For PMEGP, the subsidy is 35% of project cost in rural areas (₹1.75 lakh) and 25% in urban (₹1.25 lakh), reducing the effective loan burden. No collateral is needed for loans up to ₹10 lakh under CGTMSE.
The total project cost for a small agarbatti unit is ₹5,00,000. Promoter contribution: ₹50,000 (10%). Term loan: ₹4,50,000 at 11% p.a. for 7 years. EMI: ₹7,705 per month. The cost includes: machinery (hand rolling machine, mixing machine, drying racks) ₹2.5 lakh; raw materials (bamboo sticks, charcoal powder, fragrance oil, binding powder) ₹1.5 lakh for 2 months; working capital ₹1 lakh. Under PMEGP, the subsidy (₹1.75 lakh rural) is released after project implementation and reduces the loan principal. Under MUDRA Kishor, the entire ₹5 lakh is disbursed as a term loan. PM Vishwakarma provides ₹1 lakh collateral-free loan with 5% interest subvention. Ensure your project report includes a detailed CMA and projected balance sheet for 5 years.
For a ₹5 lakh agarbatti loan, you need: KYC (Aadhaar, PAN, Voter ID), address proof, passport-size photos, business proof (GST registration or shop license), project report (with CMA, DSCR, 5-year projections), quotations for machinery, rent agreement (if premises not owned), and for PMEGP, the application form with district office recommendation. For MUDRA, a simple one-page application with project details suffices. For PM Vishwakarma, you need a family occupation certificate and a skill certificate if available. Banks may ask for a CIBIL score (minimum 650) for loans above ₹2 lakh. Also, submit a cash flow statement showing how the EMI of ₹7,705 will be paid from monthly sales of ₹50,000-60,000. Keep all documents self-attested.
Every report is formatted to the exact standards required by Indian banks and government departments.
A complete 14-section project report — the same document your bank officer will read. Every table below is real: the repayment schedule, the DSCR, the CMA workings, the balance sheet. Generate yours free, then pay ₹499 for the clean copy.
Project Report
Consumer electronics repair, servicing & spare-parts retail
Vaishali Nagar, Jaipur, Rajasthan
Submitted to the Branch Manager · Punjab National Bank, Vaishali Nagar, Jaipur
The unit has been in operation since 2019 and currently services 20–25 jobs a day from a 350 sq.ft. ground-floor shop, with a recorded customer base of 600+ households in the Vaishali Nagar catchment. The promoter proposes to expand the workbench capacity, add board-level diagnostic equipment and carry a spare-parts inventory so that 70% of repairs can be completed same-day instead of the present 3-day turnaround.
The project is assessed at a cost of ₹10.00 lakh, financed by a ₹8.00 lakh MUDRA Tarun term loan and ₹2.00 lakh of promoter's own contribution (20%). At the projected turnover the unit services its debt 5.87 times over on average, against the 1.25 minimum, and breaks even at 62% of Year-1 sales — leaving substantial cushion against a demand shortfall.
Recommendation: the proposal is technically feasible, commercially viable and financially sound. It is recommended for sanction of a term loan of ₹8.00 lakh repayable in 60 monthly instalments.
| Particulars | Basis | Amount (₹) |
|---|---|---|
| Renovation & civil work | 200 sq.ft. additional area, electrical, ESD flooring | 1,20,000 |
| Diagnostic & repair equipment | As per quotations — Annexure IX | 2,40,000 |
| Computers, software & service tools | 2 systems, billing software, tool kits | 80,000 |
| Furniture, air-conditioning & display fixtures | Counter, racks, 1.5 T AC | 60,000 |
| Margin money for working capital | Stock, receivables & operating cash | 5,00,000 |
| Total project cost | 10,00,000 |
A 5% contingency is built into the civil and equipment estimates. All capital items are supported by three quotations each.
| Source | Amount (₹) | % of project cost |
|---|---|---|
| Promoter's own contribution | 2,00,000 | 20.00% |
| Term loan under MUDRA Tarun | 8,00,000 | 80.00% |
| Subsidy / margin money grant | Nil | — |
| Total | 10,00,000 | 100.00% |
Promoter's contribution is held in Savings A/c No. XXXXXX4417 with Punjab National Bank, Vaishali Nagar (statement enclosed). Debt–equity at inception is 4.00 : 1, improving to 1.65 : 1 by the end of Year 1.
For PMEGP, PMFME, NABARD and state-subsidy proposals this section additionally carries the margin-money subsidy workings, the subsidy-adjusted repayment and a second DSCR computed net of subsidy.
| Equipment | Qty | Rate (₹) | Amount (₹) |
|---|---|---|---|
| BGA rework station with preheater | 1 | 95,000 | 95,000 |
| Digital storage oscilloscope with probes | 1 | 45,000 | 45,000 |
| Universal IC programmer | 1 | 35,000 | 35,000 |
| Ultrasonic PCB cleaning unit | 1 | 22,000 | 22,000 |
| Soldering / desoldering stations | 3 | 8,000 | 24,000 |
| Precision tool kits & ESD workbench | 2 | 9,500 | 19,000 |
| Total | 2,40,000 |
Suppliers: Fine Tools India (Jaipur), Sagar Electronics (Delhi), Techno Instruments (Jaipur). Quotations enclosed at Annexure IX. Delivery within 30 days of sanction; installation by the supplier at no extra cost.
| Particulars | Year 1 | Year 2 | Year 3 | Year 4 | Year 5 |
|---|---|---|---|---|---|
| Service & repair income | 24.00 | 28.32 | 32.57 | 36.80 | 41.22 |
| Sale of spares & accessories | 9.60 | 11.33 | 13.03 | 14.73 | 16.49 |
| Total revenue | 33.60 | 39.65 | 45.60 | 51.53 | 57.71 |
| Cost of spares & materials (45%) | 15.12 | 17.84 | 20.52 | 23.19 | 25.97 |
| Gross profit | 18.48 | 21.81 | 25.08 | 28.34 | 31.74 |
| Salaries & wages | 6.72 | 7.26 | 7.84 | 8.47 | 9.14 |
| Rent | 1.44 | 1.51 | 1.59 | 1.67 | 1.75 |
| Power & fuel | 0.72 | 0.78 | 0.83 | 0.89 | 0.95 |
| Repairs & maintenance | 0.30 | 0.33 | 0.36 | 0.39 | 0.42 |
| Marketing & business promotion | 0.36 | 0.40 | 0.44 | 0.48 | 0.52 |
| Administrative & miscellaneous | 0.60 | 0.66 | 0.72 | 0.78 | 0.84 |
| Insurance | 0.12 | 0.13 | 0.14 | 0.15 | 0.16 |
| Total operating expenses | 10.26 | 11.07 | 11.92 | 12.83 | 13.78 |
| EBITDA | 8.22 | 10.74 | 13.16 | 15.51 | 17.96 |
| Depreciation (WDV, as per IT Act) | 0.86 | 0.66 | 0.52 | 0.42 | 0.35 |
| EBIT | 7.36 | 10.08 | 12.64 | 15.09 | 17.61 |
| Interest on term loan | 0.78 | 0.64 | 0.48 | 0.31 | 0.11 |
| Profit before tax | 6.58 | 9.44 | 12.16 | 14.78 | 17.50 |
| Income tax (as applicable) | 0.30 | 0.62 | 0.95 | 1.35 | 1.80 |
| Profit after tax | 6.28 | 8.82 | 11.21 | 13.43 | 15.70 |
Revenue grows 18%, 15%, 13% and 12% over the five years, against 22% achieved by the unit in the last audited year. Capacity utilisation moves from 72% to 91%; the projections do not assume any increase in service rates.
| Year | Opening balance | Principal repaid | Interest | Total outgo | Closing balance |
|---|---|---|---|---|---|
| 1 | 8,00,000 | 1,28,404 | 77,937 | 2,06,341 | 6,71,596 |
| 2 | 6,71,596 | 1,42,555 | 63,787 | 2,06,341 | 5,29,041 |
| 3 | 5,29,041 | 1,58,265 | 48,077 | 2,06,341 | 3,70,776 |
| 4 | 3,70,776 | 1,75,706 | 30,635 | 2,06,341 | 1,95,070 |
| 5 | 1,95,070 | 1,95,070 | 11,272 | 2,06,341 | Nil |
| Total | 8,00,000 | 2,31,707 | 10,31,705 |
| Particulars | Year 1 | Year 2 | Year 3 | Year 4 | Year 5 |
|---|---|---|---|---|---|
| Profit after tax | 6.28 | 8.82 | 11.21 | 13.43 | 15.70 |
| Add: depreciation | 0.86 | 0.66 | 0.52 | 0.42 | 0.35 |
| Add: interest on term loan | 0.78 | 0.64 | 0.48 | 0.31 | 0.11 |
| Cash available for debt service (A) | 7.92 | 10.12 | 12.21 | 14.16 | 16.16 |
| Principal repayment | 1.28 | 1.43 | 1.58 | 1.76 | 1.95 |
| Interest | 0.78 | 0.64 | 0.48 | 0.31 | 0.11 |
| Total debt service (B) | 2.06 | 2.07 | 2.06 | 2.07 | 2.06 |
| DSCR (A ÷ B) | 3.84 | 4.89 | 5.93 | 6.84 | 7.84 |
Average DSCR over the tenure: 5.87. The minimum acceptable to banks is 1.25; the unit crosses that threshold even if Year-1 revenue falls 60% short of projection.
| Particulars | Year 1 | Year 2 | Year 3 | Year 4 | Year 5 |
|---|---|---|---|---|---|
| LIABILITIES | |||||
| Capital account (net of drawings) | 4.08 | 7.50 | 12.11 | 17.74 | 24.44 |
| Term loan — long-term portion | 5.29 | 3.71 | 1.95 | — | — |
| Term loan — current maturity | 1.43 | 1.58 | 1.76 | 1.95 | — |
| Sundry creditors (30 days) | 1.26 | 1.49 | 1.71 | 1.93 | 2.16 |
| Other current liabilities & provisions | 0.30 | 0.35 | 0.40 | 0.45 | 0.50 |
| Total | 12.36 | 14.63 | 17.93 | 22.07 | 27.10 |
| ASSETS | |||||
| Net fixed assets | 4.14 | 3.48 | 2.96 | 2.54 | 2.19 |
| Stock of spares (45 days) | 1.86 | 2.20 | 2.53 | 2.86 | 3.20 |
| Sundry debtors (10 days) | 0.92 | 1.09 | 1.25 | 1.41 | 1.58 |
| Cash & bank balance | 5.44 | 7.86 | 11.19 | 15.26 | 20.13 |
| Total | 12.36 | 14.63 | 17.93 | 22.07 | 27.10 |
| Sources | Amount | Applications | Amount |
|---|---|---|---|
| Profit after tax | 6.28 | Capital expenditure | 5.00 |
| Depreciation | 0.86 | Increase in stock | 1.86 |
| Increase in creditors & provisions | 1.56 | Increase in debtors | 0.92 |
| Term loan drawn | 8.00 | Repayment of term loan | 1.28 |
| Promoter's capital introduced | 2.00 | Drawings | 4.20 |
| Closing cash & bank | 5.44 | ||
| Total | 18.70 | Total | 18.70 |
Working capital is assessed under the Tandon Committee Method II, the basis used by banks for limits up to ₹5 crore. The workings below are drawn from the Year-1 projections above.
| Particulars | Amount |
|---|---|
| Stock of spares | 1.86 |
| Sundry debtors | 0.92 |
| Cash & bank balance | 5.44 |
| Total current assets (TCA) | 8.22 |
| Sundry creditors | 1.26 |
| Other current liabilities & provisions | 0.30 |
| Current maturity of term loan | 1.43 |
| Other current liabilities (OCL) | 2.99 |
| Working capital gap (TCA − OCL) | 5.23 |
| 25% of TCA — stipulated margin | 2.06 |
| Maximum permissible bank finance (Method II) | 3.18 |
No cash-credit limit is sought in this proposal; the assessment is presented because bank officers ask for it. Were the limit of ₹3.18 lakh availed, the current ratio would stand at 1.33 — above the 1.25 stipulated by IBA.
CMA statements included in the full report
| Ratio | Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | Bank norm |
|---|---|---|---|---|---|---|
| Current ratio | 2.75 | 3.26 | 3.87 | 4.51 | 9.36 | ≥ 1.25 |
| Debt–equity ratio | 1.65 | 0.71 | 0.31 | 0.11 | Nil | ≤ 3.00 |
| DSCR | 3.84 | 4.89 | 5.93 | 6.84 | 7.84 | ≥ 1.25 |
| Net profit margin | 18.7% | 22.2% | 24.6% | 26.1% | 27.2% | — |
| Interest coverage | 9.4 | 15.8 | 26.3 | 48.7 | 160.1 | ≥ 2.00 |
| Particulars | Amount |
|---|---|
| Fixed costs (salaries, rent, admin, depreciation, interest) | 10.88 |
| Variable costs (materials, power, maintenance) | 16.14 |
| Contribution (revenue − variable costs) | 17.46 |
| P/V ratio | 51.96% |
| Break-even sales | 20.94 |
| Break-even as % of Year-1 revenue | 62.3% |
| Cash break-even as % of Year-1 revenue | 57.4% |
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Financing structured for a ₹5 Lakh agarbatti manufacturing: margin, term loan & EMI.
Scheme-ready for PMEGP, MUDRA Kishor, PM Vishwakarma.
Exact means of finance, CMA, DSCR ≥ 1.50 in the generated report.
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Indicatively ≈ ₹7,705/month on the ~₹4.5 Lakh term-loan portion (at 11% over 7 years), with ~₹50,000 promoter margin. The report computes exact figures.
Banks typically expect ~10% margin — about ₹50,000 for a ₹5 Lakh project — plus any scheme subsidy.
PMEGP, MUDRA Kishor, PM Vishwakarma fit this range. The report is configured to your chosen scheme.
The EMI is approximately ₹7,705 per month. This is calculated using the formula: EMI = P × r × (1+r)^n / ((1+r)^n - 1), where P=₹4,50,000, r=0.009167 (11%/12), n=84 months. Total interest over 7 years is about ₹1,97,000. Ensure your projected monthly profit covers this EMI comfortably.
Yes, PMEGP offers subsidy of 35% (rural) or 25% (urban) of the project cost, capped at ₹1.75 lakh for rural and ₹1.25 lakh for urban areas. For a ₹5 lakh project, the subsidy is ₹1.75 lakh (rural) or ₹1.25 lakh (urban). The subsidy is released after the project is implemented and the loan is disbursed. It reduces your effective loan burden.
MUDRA Kishor provides loans from ₹50,001 to ₹5 lakh for non-farm income activities. It is collateral-free and available to any individual. PM Vishwakarma is specifically for traditional artisans, offering up to ₹1 lakh collateral-free loan with 5% interest subvention (effective interest ~6-7%). For a ₹5 lakh loan, MUDRA Kishor is more suitable. PM Vishwakarma can be used for initial working capital.
A typical agarbatti unit with ₹5 lakh investment can generate monthly sales of ₹50,000-60,000. Raw material cost is about 50-55% of sales, labor 10-15%, overheads 10%, leaving a net profit of 20-25% (₹10,000-15,000/month). The DSCR should be above 1.5, meaning net profit plus depreciation covers the EMI by 1.5 times. Break-even is usually within 18 months.