§1What this business is
EC-grade aluminium rod (and alloy rod) is drawn into wire, heat-treated where needed and stranded in layers on stranding machines; ACSR has a galvanised steel core for strength. The conductors are wound on wooden drums and tested to IS 398. ACSR goes into transmission lines and AAC and AAAC into distribution lines, so buyers are electricity boards, power utilities and line contractors.
Capacity: 468 tonnes a year (AAC 170 t, ACSR 150 t, AAAC 119 t, other aluminium conductor 26 t, scrap 3 t), worth ₹4.95 crore.
§2Is it right for you?
Who it is for
An engineer or metal trader with capital who can register as a vendor with electricity boards and line contractors.
Who it is not for
A first-time founder with small capital or no access to utility tenders.
Advantages
- Steady demand from power transmission and rural electrification
- Simple, proven technology
- Product sold by weight to a fixed standard (IS 398)
- Large turnover per worker
Drawbacks
- Very large working capital: metal is most of the cost
- Sales depend on tenders from power utilities
- Aluminium price swings hit the margin
- Needs heavy machines and a 150 KVA connection
Skills you need
- Wire drawing and stranding
- Testing to IS 398 (tensile, torsion, wrapping)
- Tendering with power utilities
- Metal purchase and hedging
Why difficulty 4/5: Heavy capital, metal-price risk and selling through utility tenders.
§3Market
Who buys
- State electricity boards and power distribution companies
- Transmission and distribution line contractors
- Rural electrification projects
How it sells
- Government and utility tenders
- Supply to EPC line contractors
Good to know
- The profile notes that AAC/AAAC/ACSR up to 19 strands were then reserved for small-scale units; that reservation list has since been withdrawn.
- Testing can be done at government test centres (ETDC, ERTL, RTC) as well as in-house.
§4Raw material & machinery
| Item | Qty | Cost |
|---|---|---|
| Pintle-type multilayer stranding machine (61 strands) | 1 set | ₹24,00,000 |
| High-speed tubular stranding machine | 1 set | ₹12,00,000 |
| Wire drawing machine, 11 dies | 1 set | ₹11,00,000 |
| Wire drawing machine, 3 dies, with spooling | 1 set | ₹3,60,000 |
| Pit-type solution treatment furnace | 1 set | ₹2,25,000 |
| Ageing furnace | 1 set | ₹65,000 |
| Pointing machine, butt welding machine, electric crane, solution tank, die polisher | 1 set each | ₹69,000 |
| Tensile testing machine | 1 set | ₹2,80,000 |
| Torsion, wrapping and resistance test equipment, balance and micrometer | 1 set each | ₹1,68,000 |
From: DC-MSME project profile — Aluminium Conductors AAC, AAAC, ACSR (2003)
- Aluminium rod, EC grade (IS 5484)25 t a month at ₹87,850/t = ₹21.96 L
- Aluminium alloy rod10 t a month at ₹92,750/t = ₹9.28 L
- Galvanised steel wire (for ACSR core)4 t a month at ₹28,000/t = ₹1.12 L
- Wooden drums, lubricants and sundries₹70,000 a month
From: DC-MSME project profile — Aluminium Conductors AAC, AAAC, ACSR (2003)
Suppliers in Building Business Bazaar
NSIC Technical Services Centre, Howrah · Howrah →Baba Engineering Works · Hyderabad →Bharat Aluminium Co. Ltd · Kolkata →Bharat Engg. Works · Kolkata →Bluestar Ltd · Kolkata →Devendra Industries · Delhi →Golden Engineering Industries · Delhi →Hargolal and Sons · Ambala →Hind Engineering Works · Howrah →Hindustan Wire Netting Co. Pvt. Ltd · Mumbai →NALCO · Bhubaneswar →Nehru Engineering and Sons Liluah · Howrah →
In our raw material database
§5Licences & registration
- Udyam registration
- GST
- BIS certification to IS 398 (utilities buy to this standard)
- State Pollution Control Board consent
- Factory licence
§6Schemes & subsidies
- CGTMSECentralActiveNo collateral, up to ₹10 crore
- Stand-Up IndiaCentralClosed₹10 lakh – ₹1 crore loan
At ₹1.80 crore the project is above PMEGP and MUDRA limits; CGTMSE covers collateral-free loans and Stand-Up India helps SC/ST and women founders with part of it.
§7Money
How the investment is worked out: DC-MSME profile: land and building ₹10.80 L (2,000 sq m land ₹3.00 L, 600 sq m shed ₹6.00 L, 150 sq m office and store ₹1.80 L); machinery ₹54.19 L (61-strand multilayer stranding machine ₹24.00 L, high-speed tubular stranding ₹12.00 L, 11-die wire drawing ₹11.00 L, 3-die wire drawing ₹3.60 L, solution treatment furnace ₹2.25 L and more) + testing equipment and electrification, total ₹64.49 L; total fixed capital ₹75.90 L; working capital for 3 months ₹1.03 crore; total ₹1.79 crore (say ₹1.80 crore).
Working capital: Working capital for 3 months ₹1.03 crore; monthly spend ₹34.42 L, of which aluminium rod, alloy rod, steel wire and drums ₹33.06 L.
Prices from 2002–03 — machinery, material and wage costs will be much higher now.
§8Export potential
Confirm the HS code in the DGFT ITC(HS) lookup before you export
Export council / board: EEPC India
- Confirm the 8-digit ITC(HS) line with DGFT or your customs broker before shipping.
- You need an Import Export Code (IEC) from DGFT before the first shipment.
§9Risks — where people fail
- Aluminium price changes
- Late payment from utilities
- Tender rejection on test results
- Competition from large cable makers
§1030 / 60 / 90-day plan
A general plan that applies to any business. A plan for this business will be added after research.
- Days 1–30: Visit a working aluminium conductors (aac, aaac, acsr) unit, ask 10 buyers about price and quantity, and get quotations from 3 suppliers.
- Days 31–60: Udyam and the licences you need (Udyam registration, GST), a project report (DPR), and the scheme or loan file.
- Days 61–90: Space and machines, trial production, and first deliveries to 10 customers.
§11Who to connect with
Associations, clusters and training institutes — the directory is being built. Connect
§12Watch
There is no episode on this business yet. Shows are coming soon on the Podcast page.
Want to start Aluminium Conductors (AAC, AAAC, ACSR)?
DPR, loan file or registration — ask us on WhatsApp.
¶Sources
Data review: 6 October 2026. Spotted a mistake? Report it. For information only — not legal or financial advice.