Detailed Project Report
Handloom Gamcha (Loin Cloth)
—
Prepared on: 13 November 2026 · Prepared with Building Business DPR (buildingbusiness.in)
01 Project at a glance
- Total project cost
- ₹0.84 L
- Term loan from bank
- ₹0.55 L
- Promoter’s contribution
- ₹0.08 L
- Subsidy
- ₹0.21 L
- Sales · Year 3
- ₹0.00 L
- Profit after tax · Year 3
- ₹-3.03 L
- Average DSCR
- -26.74
- Break-even (% of capacity used)
- —
02 Promoter and unit
| Promoter name | — |
|---|---|
| Business / firm name | — |
| Legal form | Proprietorship |
| Address of the unit | — |
| Applicant category | General · Rural |
03 The project
Weave checked cotton gamchas on traditional handlooms for everyday and religious use.
| Main product or service | Handloom Gamcha (Loin Cloth) |
|---|---|
| Installed capacity per year (at 100%) | 10,000 units |
04 Market
- Cloth shops and village markets
- Temple-town and pilgrimage shops
- Wholesalers
- Government and handloom emporiums
- Wholesale supply
- Weekly haats and fairs
- Handloom expos and emporiums
05 Plant and machinery
| Item | Qty | ₹ | Total ₹ |
|---|---|---|---|
| Traditional handloom | 1 | 40,000 | 40,000 |
| Warping beam | 1 | 10,000 | 10,000 |
| Local-made spools (× 1 lot) | 1 | 4,500 | 4,500 |
| Brushes made of cereal-root fibre (× 1 lot) | 1 | 10,000 | 10,000 |
| Flying shuttle | 1 | 4,000 | 4,000 |
| Pirns and bobbins (× 1 lot) | 1 | 11,500 | 11,500 |
| Total | 80,000 |
Pre-filled from: PMEGP sample project report — Handloom Loin Cloth/Gamcha (prepared by Udyami/Samadhan); DGFT – ITC(HS) Classification of Export and Import Items. Prices in older reports will have gone up — enter today’s quotations.
06 Raw materials
- Cotton yarn / thread bundles — main input; raw material ₹30.75 lakh in year 1
- Vat and naphthol dyes, acetic acid, crystal salt, mordant — for dyeing
- Rice starch and coconut oil — for sizing the yarn
07 Cost of project
| ₹ in lakh | |
|---|---|
| Plant and machinery | 0.80 |
| Contingency | 0.04 |
| Total fixed capital | 0.84 |
| Working capital margin | 0.00 |
| Total project cost | 0.84 |
08 Means of finance
| ₹ in lakh | % | |
|---|---|---|
| Promoter’s contribution | 0.08 | 10.0 |
| Subsidy | 0.21 | 25.0 |
| Term loan from bank | 0.55 | 65.0 |
| Total | 0.84 | 100.0 |
| Working capital loan (outside project cost) | 0.00 |
09 Key assumptions
| Selling price | ₹0 per units |
|---|---|
| Raw material & packing cost | ₹0 per units |
| Capacity used each year | 60% · 70% · 80% · 80% · 80% · 80% · 80% |
| Term loan interest rate (% a year) | 11% · 84 months (Moratorium 6) |
| Working capital method | Turnover method (RBI) · Working capital interest (% a year) 11% |
| Income tax rate | 25% |
| Yearly price and cost rise | 0% |
10 Production and sales
| Year → (₹ in lakh) | 1 | 2 | 3 | 4 | 5 | 6 | 7 |
|---|---|---|---|---|---|---|---|
| Capacity used | 60% | 70% | 80% | 80% | 80% | 80% | 80% |
| Production (units) | 6,000 | 7,000 | 8,000 | 8,000 | 8,000 | 8,000 | 8,000 |
| Sales | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
11 Projected profitability
| Year → (₹ in lakh) | 1 | 2 | 3 | 4 | 5 | 6 | 7 |
|---|---|---|---|---|---|---|---|
| Sales | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Raw material and packing | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Power and fuel | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Salaries and wages | 2.88 | 2.88 | 2.88 | 2.88 | 2.88 | 2.88 | 2.88 |
| Rent | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Administration | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Selling and distribution | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Repairs and maintenance | 0.02 | 0.02 | 0.02 | 0.02 | 0.02 | 0.02 | 0.02 |
| Insurance | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Total cost of operations | 2.90 | 2.90 | 2.90 | 2.90 | 2.90 | 2.90 | 2.90 |
| Operating profit (EBITDA) | -2.90 | -2.90 | -2.90 | -2.90 | -2.90 | -2.90 | -2.90 |
| Depreciation | 0.13 | 0.11 | 0.09 | 0.08 | 0.07 | 0.06 | 0.05 |
| Preliminary expenses written off | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Interest on term loan | 0.06 | 0.05 | 0.04 | 0.03 | 0.02 | 0.01 | 0.01 |
| Interest on working capital | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Profit before tax | -3.09 | -3.06 | -3.03 | -3.01 | -2.99 | -2.97 | -2.95 |
| Income tax | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Profit after tax | -3.09 | -3.06 | -3.03 | -3.01 | -2.99 | -2.97 | -2.95 |
12 Cash flow
| Year → (₹ in lakh) | 1 | 2 | 3 | 4 | 5 | 6 | 7 |
|---|---|---|---|---|---|---|---|
| Profit after tax | -3.09 | -3.06 | -3.03 | -3.01 | -2.99 | -2.97 | -2.95 |
| Depreciation | 0.13 | 0.11 | 0.09 | 0.08 | 0.07 | 0.06 | 0.05 |
| Cash accruals (PAT + depreciation) | -2.96 | -2.95 | -2.94 | -2.93 | -2.92 | -2.92 | -2.91 |
| Term loan repaid | 0.04 | 0.08 | 0.08 | 0.08 | 0.08 | 0.08 | 0.08 |
| Owner’s drawings | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Surplus after repayment | -3.00 | -3.04 | -3.03 | -3.02 | -3.01 | -3.00 | -2.99 |
| Cash and bank | -3.00 | -6.04 | -9.07 | -12.08 | -15.09 | -18.09 | -21.08 |
13 Projected balance sheet
| Year → (₹ in lakh) | 1 | 2 | 3 | 4 | 5 | 6 | 7 |
|---|---|---|---|---|---|---|---|
| Capital (own + subsidy) | 0.29 | 0.29 | 0.29 | 0.29 | 0.29 | 0.29 | 0.29 |
| Reserves and surplus | -3.09 | -6.15 | -9.18 | -12.19 | -15.18 | -18.15 | -21.11 |
| Term loan outstanding | 0.50 | 0.42 | 0.34 | 0.25 | 0.17 | 0.08 | 0.00 |
| Working capital loan | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Total liabilities | -2.29 | -5.43 | -8.55 | -11.64 | -14.72 | -17.77 | -20.81 |
| Net fixed assets | 0.71 | 0.61 | 0.52 | 0.44 | 0.37 | 0.32 | 0.27 |
| Preliminary expenses not written off | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Current assets (stock and debtors) | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Cash and bank | -3.00 | -6.04 | -9.07 | -12.08 | -15.09 | -18.09 | -21.08 |
| Total assets | -2.29 | -5.43 | -8.55 | -11.64 | -14.72 | -17.77 | -20.81 |
14 Ratios and break-even
| Year | 1 | 2 | 3 | 4 | 5 | 6 | 7 |
|---|---|---|---|---|---|---|---|
| Debt service coverage ratio (DSCR) | -28.70 | -21.46 | -23.03 | -24.85 | -26.99 | -29.53 | -32.59 |
| Break-even (% of capacity used) | — | — | — | — | — | — | — |
| Cash break-even | — | — | — | — | — | — | — |
| Average DSCR | -26.74 |
|---|---|
| Lowest DSCR | -32.59 |
| Payback period | — |
15 Depreciation
| Year → (₹ in lakh) | 1 | 2 | 3 | 4 | 5 | 6 | 7 |
|---|---|---|---|---|---|---|---|
| Depreciation | 0.13 | 0.11 | 0.09 | 0.08 | 0.07 | 0.06 | 0.05 |
Written-down value method at Income-tax Rules block rates (building 10%, plant & machinery 15%, furniture 10%, computers 40%). Change them if your CA uses other rates.
16 Term loan repayment
| Year | Opening | Interest | Term loan repaid | Closing |
|---|---|---|---|---|
| 1 | 0.55 | 0.06 | 0.04 | 0.50 |
| 2 | 0.50 | 0.05 | 0.08 | 0.42 |
| 3 | 0.42 | 0.04 | 0.08 | 0.34 |
| 4 | 0.34 | 0.03 | 0.08 | 0.25 |
| 5 | 0.25 | 0.02 | 0.08 | 0.17 |
| 6 | 0.17 | 0.01 | 0.08 | 0.08 |
| 7 | 0.08 | 0.01 | 0.08 | 0.00 |
17 Licences and registrations
- Udyam registration
- GST
- Handloom Mark registration (optional)
- Trade licence from the local body
18 Government schemes that may apply
- Prime Minister's Employment Generation Programme (PMEGP)
- Pradhan Mantri MUDRA Yojana (PMMY) – Shishu, Kishor, Tarun, Tarun Plus
- Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE)
- Stand-Up India
19 Sources
- PMEGP sample project report — Handloom Loin Cloth/Gamcha (prepared by Udyami/Samadhan) — https://pmegp.msme.gov.in/Home/DownloadDocument?fileName=Documents/ProjectSampleReport/Loin_Cloth_DPR_%28_Samadhan_Projects_%29.pdf
- DGFT – ITC(HS) Classification of Export and Import Items — https://www.dgft.gov.in/CP/?opt=itchs-import-export
This report is a projection from the figures entered by the promoter. It is not a bank appraisal or a guarantee of a loan or subsidy. Check every figure with current quotations and your chartered accountant before submitting it.