Detailed Project Report
Towel Manufacturing
—
Prepared on: 13 November 2026 · Prepared with Building Business DPR (buildingbusiness.in)
01 Project at a glance
- Total project cost
- ₹18.38 L
- Term loan from bank
- ₹11.94 L
- Promoter’s contribution
- ₹1.84 L
- Subsidy
- ₹4.59 L
- Sales · Year 3
- ₹0.00 L
- Profit after tax · Year 3
- ₹-6.25 L
- Average DSCR
- -1.41
- 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 terry towel fabric on a power loom, bleach, dye, cut, stitch and pack towels.
| Main product or service | Towel Manufacturing |
|---|---|
| Installed capacity per year (at 100%) | 10,000 units |
04 Market
- Households
- Hotels and hospitals
- Gyms, salons and spas
- Textile wholesalers
- Direct supply to hotels and hospitals
- Retail and online stores
05 Plant and machinery
| Item | Qty | ₹ | Total ₹ |
|---|---|---|---|
| Power loom | 1 | 5,00,000 | 5,00,000 |
| Terry towel fabric dyeing machine | 1 | 1,25,000 | 1,25,000 |
| Towel length cutting machine | 1 | 10,00,000 | 10,00,000 |
| Stitching machine | 1 | 25,000 | 25,000 |
| Boiler | 1 | 50,000 | 50,000 |
| Material handling and other equipment | 1 | 50,000 | 50,000 |
| Total | 17,50,000 |
Pre-filled from: PMEGP sample project report — Towel Manufacturing (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
- Yarn — spun with synthetic fibre and polyester, as the report states
- PVA starch — for sizing
- Bleaching material — hydrogen peroxide, caustic, defoamers and other chemicals
07 Cost of project
| ₹ in lakh | |
|---|---|
| Plant and machinery | 17.50 |
| Contingency | 0.88 |
| Total fixed capital | 18.38 |
| Working capital margin | 0.00 |
| Total project cost | 18.38 |
08 Means of finance
| ₹ in lakh | % | |
|---|---|---|
| Promoter’s contribution | 1.84 | 10.0 |
| Subsidy | 4.59 | 25.0 |
| Term loan from bank | 11.94 | 65.0 |
| Total | 18.38 | 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 | 0.37 | 0.37 | 0.37 | 0.37 | 0.37 | 0.37 | 0.37 |
| Insurance | 0.09 | 0.09 | 0.09 | 0.09 | 0.09 | 0.09 | 0.09 |
| Total cost of operations | 3.34 | 3.34 | 3.34 | 3.34 | 3.34 | 3.34 | 3.34 |
| Operating profit (EBITDA) | -3.34 | -3.34 | -3.34 | -3.34 | -3.34 | -3.34 | -3.34 |
| Depreciation | 2.76 | 2.34 | 1.99 | 1.69 | 1.44 | 1.22 | 1.04 |
| Preliminary expenses written off | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Interest on term loan | 1.29 | 1.12 | 0.92 | 0.72 | 0.51 | 0.31 | 0.11 |
| Interest on working capital | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Profit before tax | -7.39 | -6.80 | -6.25 | -5.75 | -5.29 | -4.87 | -4.49 |
| Income tax | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Profit after tax | -7.39 | -6.80 | -6.25 | -5.75 | -5.29 | -4.87 | -4.49 |
12 Cash flow
| Year → (₹ in lakh) | 1 | 2 | 3 | 4 | 5 | 6 | 7 |
|---|---|---|---|---|---|---|---|
| Profit after tax | -7.39 | -6.80 | -6.25 | -5.75 | -5.29 | -4.87 | -4.49 |
| Depreciation | 2.76 | 2.34 | 1.99 | 1.69 | 1.44 | 1.22 | 1.04 |
| Cash accruals (PAT + depreciation) | -4.63 | -4.46 | -4.26 | -4.06 | -3.85 | -3.65 | -3.45 |
| Term loan repaid | 0.92 | 1.84 | 1.84 | 1.84 | 1.84 | 1.84 | 1.84 |
| Owner’s drawings | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Surplus after repayment | -5.55 | -6.30 | -6.09 | -5.89 | -5.69 | -5.49 | -5.29 |
| Cash and bank | -5.55 | -11.85 | -17.94 | -23.84 | -29.53 | -35.01 | -40.30 |
13 Projected balance sheet
| Year → (₹ in lakh) | 1 | 2 | 3 | 4 | 5 | 6 | 7 |
|---|---|---|---|---|---|---|---|
| Capital (own + subsidy) | 6.43 | 6.43 | 6.43 | 6.43 | 6.43 | 6.43 | 6.43 |
| Reserves and surplus | -7.39 | -14.19 | -20.44 | -26.19 | -31.48 | -36.35 | -40.84 |
| Term loan outstanding | 11.03 | 9.19 | 7.35 | 5.51 | 3.68 | 1.84 | 0.00 |
| Working capital loan | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Total liabilities | 10.07 | 1.43 | -6.66 | -14.24 | -21.37 | -28.08 | -34.41 |
| Net fixed assets | 15.62 | 13.28 | 11.28 | 9.59 | 8.15 | 6.93 | 5.89 |
| 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 | -5.55 | -11.85 | -17.94 | -23.84 | -29.53 | -35.01 | -40.30 |
| Total assets | 10.07 | 1.43 | -6.66 | -14.24 | -21.37 | -28.08 | -34.41 |
14 Ratios and break-even
| Year | 1 | 2 | 3 | 4 | 5 | 6 | 7 |
|---|---|---|---|---|---|---|---|
| Debt service coverage ratio (DSCR) | -1.51 | -1.13 | -1.21 | -1.31 | -1.42 | -1.55 | -1.72 |
| Break-even (% of capacity used) | — | — | — | — | — | — | — |
| Cash break-even | — | — | — | — | — | — | — |
| Average DSCR | -1.41 |
|---|---|
| Lowest DSCR | -1.72 |
| Payback period | — |
15 Depreciation
| Year → (₹ in lakh) | 1 | 2 | 3 | 4 | 5 | 6 | 7 |
|---|---|---|---|---|---|---|---|
| Depreciation | 2.76 | 2.34 | 1.99 | 1.69 | 1.44 | 1.22 | 1.04 |
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 | 11.94 | 1.29 | 0.92 | 11.03 |
| 2 | 11.03 | 1.12 | 1.84 | 9.19 |
| 3 | 9.19 | 0.92 | 1.84 | 7.35 |
| 4 | 7.35 | 0.72 | 1.84 | 5.51 |
| 5 | 5.51 | 0.51 | 1.84 | 3.68 |
| 6 | 3.68 | 0.31 | 1.84 | 1.84 |
| 7 | 1.84 | 0.11 | 1.84 | 0.00 |
17 Licences and registrations
- Udyam registration
- GST registration
- State Pollution Control Board consent (bleaching and dyeing effluent)
- Factory licence if worker count crosses the limit
- Trademark for the brand
18 Government schemes that may apply
- Prime Minister's Employment Generation Programme (PMEGP)
- Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE)
19 Sources
- PMEGP sample project report — Towel Manufacturing (prepared by Udyami/Samadhan) — https://pmegp.msme.gov.in/Home/DownloadDocument?fileName=Documents/ProjectSampleReport/Towel_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.