§1What this business is
The cylinder block holds the cylinder liner of a diesel engine and has passages for cooling water and lubricating oil. In this unit the casting is bought from a foundry, not made in-house. It is cleaned, the top face, top bore and bottom bore are machined on a lathe, the bottom face is machined to the right height, then the window and flange faces are finished. Drilling and tapping come last. Every block is checked at each stage against the buyer's drawing. Blocks go to diesel engine manufacturers as original equipment and to the replacement market.
Capacity: 15,000 cylinder blocks a year of various sizes; single shift, 300 days. Annual sales value ₹1.1025 crore. Capacity use is taken as 70% in year 1, 75% in year 2 and 80% after that.
§2Is it right for you?
Who it is for
A machinist or ITI turner in an engine cluster such as Agra, Rajkot or Kolhapur who wants to become an ancillary supplier.
Who it is not for
Someone with no machine shop experience or no tie-up with an engine maker.
Advantages
- Low machinery cost — four lathes, a drill, a tapping machine and a grinder
- No foundry needed; castings are bought ready
- Demand from both engine makers and the spares market
- Not a polluting industry
Drawbacks
- Thin margin of 7.65% on sales
- Almost all the money is locked in castings
- Depends on a few engine makers for orders
- A casting with hidden blow holes is a full loss after machining
Skills you need
- Lathe turning and boring to close sizes
- Jig and fixture setting
- Drilling and tapping
- Inspection with gauges
Why difficulty 3/5: Simple machines, but the bores must be accurate and buyers are few.
§3Market
Who buys
- Diesel engine manufacturers (original equipment)
- Engine spare parts dealers
- Engine repair and reconditioning workshops
How it sells
- Ancillary supply against an engine maker's drawing and schedule
- Sale through spare parts wholesalers
Good to know
- The profile prices a block at ₹725 and adds ₹1.50 L a year from sale of scrap.
- It describes the unit as an ancillary to diesel engine manufacturers.
§4Raw material & machinery
| Item | Qty | Cost |
|---|---|---|
| Medium duty lathe, 1,000 mm between centres, 230 mm centre height, 2 HP | 3 | ₹1,80,000 |
| Medium duty lathe, 6 ft bed, 2 HP | 1 | ₹80,000 |
| Pillar drilling machine, 25 mm capacity, 2 HP | 1 | ₹16,000 |
| Automatic tapping machine, 2 HP | 1 | ₹25,000 |
| Double-ended grinder, 250 mm wheel, 2 HP | 1 | ₹6,000 |
| Testing and measuring equipment | — | ₹15,000 |
| Other tools and fixtures | — | ₹20,000 |
From: DC-MSME project profile — Diesel Engine Cylinder Block (2011)
- Grey cast iron Grade 20 cylinder block castings17 tonnes a month at ₹42,000 a tonne = ₹7,14,000; bought from foundries
From: DC-MSME project profile — Diesel Engine Cylinder Block (2011)
§5Licences & registration
- Udyam registration
- GST registration
- Factory licence where the worker and power limits apply
- Trade licence from the local body
Start it in your state
Pick your state: today’s cost, central + state subsidy, raw material, land and help, on one page.
§6Schemes & subsidies
At ₹28.28 lakh the project fits within the PMEGP ceiling of ₹50 lakh for manufacturing. CGTMSE can cover the working capital loan without collateral.
§7Money
How the investment is worked out: Fixed capital ₹4.07 L (machinery and equipment ₹3.87 L, pre-operative ₹0.20 L; shed rented) + working capital for 3 months ₹24.21 L = ₹28.28 L.
Working capital: Working capital is ₹8.07 L a month, of which ₹7.14 L is grey cast iron (17 tonnes at ₹42,000 a tonne). The profile takes 3 months: ₹24.21 L.
Prices from 2011 — machine tools, castings and wages 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
- The profile does not discuss exports; the unit is planned as a supplier to Indian engine makers.
§9Risks — where people fail
- Rejection for bore size or face height
- Engine makers delaying payment
- Price swings in cast iron
- Falling demand for small diesel engines as electric pumps spread
§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 diesel engine cylinder block machining 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 registration), 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
§12Watch
There is no episode on this business yet. Shows are coming soon on the Podcast page.
Want to start Diesel Engine Cylinder Block Machining?
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.