§1What this business is
Shellac-based varnish is mixed in stainless-steel vats with a mechanical stirrer, settled in a reservoir with a bottom stopcock and filled into containers. Electrical workshops apply it as an over-coat on motor parts and accessories after fabrication and on electrical conductors. The KVIC profile plans 4,094 litres a year with two people.
Capacity: 4,094 litres a year at ₹150 a litre cost; sales ₹8.19 L.
§2Is it right for you?
Who it is for
Someone near lac-producing areas (Jharkhand, Chhattisgarh, West Bengal) or with links to motor-rewinding shops.
Who it is not for
Someone looking for a large-volume business.
Advantages
- Very small investment (₹2.69 L)
- Simple mixing, two people can run it
- Repeat buyers in motor-rewinding and electrical workshops
- Uses shellac, a natural Indian product
Drawbacks
- Small market and small income
- Synthetic insulating varnishes compete
- Flammable solvents need careful storage
- Shellac prices vary with the lac crop
Skills you need
- Varnish mixing and testing
- Safe handling of flammable material
- Selling to workshops and dealers
- Buying shellac
Why difficulty 2/5: Simple, low-cost mixing, but fire safety and a narrow market need care.
§3Market
Who buys
- Motor and electrical-machine makers and rewinders
- Makers of electrical accessories and conductors
How it sells
- Electrical hardware dealers
- Direct supply to workshops
Good to know
- The profile says the scheme gives employment to 2 persons.
§4Raw material & machinery
| Item | Qty | Cost |
|---|---|---|
| Equipment set: SS vats 50 litre, mechanical stirrer with 0.5 HP motor, 50-litre SS reservoir with bottom stopcock, weighing balance, measuring cylinder and other tools | 1 set | ₹25,000 (whole set) |
From: KVIC Project Profile — Shellac Insulating Varnish (Air-Drying) (PMEGP)
- Shellac and other varnish ingredients₹3,52,542 a year
- Labels and packaging₹25,000 a year
From: KVIC Project Profile — Shellac Insulating Varnish (Air-Drying) (PMEGP)
In our raw material database
§5Licences & registration
- Udyam registration
- GST
- State Pollution Control Board consent
- Fire safety clearance for storing flammable solvents
§6Schemes & subsidies
- PMEGPCentralActive15–35% subsidy
- MudraCentralActiveLoan up to ₹20 lakh, no collateral
- CM YUVAUPActiveUp to ₹5 lakh, interest-free
- CGTMSECentralActiveNo collateral, up to ₹10 crore
PMEGP, MUDRA (Shishu) and CM-YUVA (UP, up to ₹5 L) all fit this ₹2.69 L unit; CGTMSE for a collateral-free loan.
§7Money
How the investment is worked out: KVIC profile ₹2,68,525 = land and building shed 300 sq ft ₹90,000 + equipment ₹25,000 + working capital ₹1,53,525.
Working capital: Working capital ₹1,53,525; raw material ₹3,52,542 a year.
Year not printed on the KVIC profile — check current machinery prices.
§8Export potential
Shellac exports are promoted by SHEFEXIL, but a small varnish unit will mainly serve the home market.
§9Risks — where people fail
- Fire risk
- Shift to synthetic varnishes
- Shellac price swings
- Poor drying or insulation complaints
§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 shellac insulating varnish (air-drying) 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 Shellac Insulating Varnish (Air-Drying)?
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.