What is a aluminium ingot from aluminium scrap project report?
An aluminium ingot from aluminium scrap project report is a detailed project report (DPR) for a secondary smelter. The plant melts sorted scrap, corrects its chemistry and casts alloy ingots such as ADC12 or LM6. The report sets out the furnaces, scrap mix, metal recovery, approvals, project cost, finance, five-year projections, DSCR and break-even.
Promoters use it to size the melt shop and raise a term loan; lenders and investors use it to judge whether the conversion margin can carry the debt.
Also known as: aluminium recycling plant project report, secondary aluminium ingot plant DPR, aluminium alloy ingot project report, aluminium scrap melting plant business plan.
Aluminium ingot from aluminium scrap manufacturing plant cost in India
Our sample report models a 10 MT per day plant working 330 days a year, which gives 3,300 MT per year at full capacity. It starts at 60% utilisation, reaches 80% in Year 5 and sells alloy ingot at ₹2,15,000 per MT.
The plant earns a conversion margin, not a product margin. Raw materials take 74.5% of sales in Year 3, so a small change in scrap price or metal recovery moves profit quickly.
| Land and site development | 69.08 |
|---|---|
| Building and civil works | 265.54 |
| Plant and machinery | 518.63 |
| Other fixed assets | 58.24 |
| Contingencies | 39.21 |
| Preliminary and pre-operative | 23.77 |
| Working capital margin | 181.38 |
| Total | 1,155.85 |
| Promoter's contribution (25%) | 288.96 |
|---|---|
| Term loan from bank (75%) | 866.89 |
| Cash credit limit (separate) | 544.15 |
| Total project cost | 1,155.85 |
Term loan at 10.5% with a 6-month moratorium and 54 monthly instalments. DSCR is lowest at 1.24 in Year 2, when full repayments begin. All figures are illustrative.
Aluminium ingot from aluminium scrap manufacturing process
A secondary plant does not make new aluminium. It melts, cleans and re-alloys metal that already exists, and every step decides how much of the scrap you paid for leaves the gate as saleable ingot.
- Sorting and testing
Each lot is weighed and checked with a handheld analyser, then split by alloy family so high-silicon die-cast scrap does not mix with wrought extrusion scrap.
- Size reduction and cleaning
Bulky scrap is shredded, magnets pull out iron inserts, and oily turnings are dried so moisture and oil do not burn off inside the furnace.
- Melting
The charge is melted under a salt cover flux in a tilting rotary furnace at about 720–780 °C; the flux limits oxidation and carries oxides into the dross.
- Alloy correction
A sample goes to the optical emission spectrometer, and silicon, copper, magnesium or primary aluminium is added in the holding furnace to bring the melt to grade.
- Degassing and filtering
A rotary degasser bubbles nitrogen or argon through the melt to strip dissolved hydrogen, and a ceramic foam filter catches oxide inclusions.
- Ingot casting
Metal is poured into moulds on a moving casting conveyor, cooled and knocked out as notched ingots that buyers can break and charge easily.
- Dross handling
Hot dross is skimmed, cooled and pressed to squeeze out trapped metal; the residue goes only to an authorised processor.
- Marking and dispatch
Ingots are bundled, marked with grade and heat number, and sent with a test certificate showing the spectrometer result.
Rotary, reverberatory or induction: which furnace suits your scrap?
Furnace choice follows the scrap you can buy, not the other way round. A technical reviewer checks it first, because it sets the metal recovery the whole report depends on.
| Tilting rotary furnace | Handles mixed, painted, oily and thin scrap and dross because the drum tumbles the charge under salt flux. Leaves salt cake that must be disposed of safely. |
|---|---|
| Reverberatory furnace | Large open bath fired from above. Suits clean, bulky scrap such as extrusion offcuts and returns, and works well as a holding and alloying furnace. |
| Induction furnace | Electric, no combustion gas, quick to start. Suits small batches of clean scrap; dirty scrap raises melt loss and power use per tonne. |
| Rotary melter with reverberatory holder | The rotary furnace melts, the reverberatory furnace holds the bath while the spectrometer result comes back and the alloy is corrected. This is the layout in our sample report. |
Why two furnaces: alloy correction takes time. Holding the melt in a separate furnace lets the rotary furnace start the next charge, which keeps a 10 MT per day line moving.
Aluminium scrap and other raw materials
Scrap is bought by grade: extrusion offcuts, die-cast returns and runners, used beverage cans, machining turnings, utensil scrap and shredded mixed automotive scrap. A large part of the scrap used in India is imported, so prices follow the international aluminium price, freight and the rupee.
Silicon metal and master alloys bring the melt to grade, and some primary aluminium dilutes iron or copper when a lot comes in high.
| Raw material | Share of cost | Year 3 (₹ lakh) |
|---|---|---|
| Aluminium scrap (imported and domestic) | 84% | 3,107.33 |
| Silicon metal and master alloys | 9% | 332.93 |
| Primary aluminium for dilution | 4% | 147.97 |
| Cover flux and degassing agents | 3% | 110.97 |
| Total | 100% | 3,699.20 |
Machinery for an aluminium scrap to ingot plant
The rotary furnace is the largest machinery item in our sample. The fume extraction and bag filter system comes second, ahead of the holding furnace, which shows how much of the spend goes on keeping the plant within its consent.
| Machine | What it does | Sample cost (₹ lakh) |
|---|---|---|
| Tilting rotary furnace with oxy-fuel burner | Melts mixed scrap under salt flux | 145.22 |
| Reverberatory holding and alloying furnace | Holds the melt while it is brought to grade | 72.61 |
| Scrap shredder with magnetic separator | Cuts bulky scrap and removes iron | 57.05 |
| Rotary degassing unit and ceramic filter box | Removes hydrogen and inclusions | 31.12 |
| Automatic ingot casting conveyor | Casts and cools ingots in moulds | 62.24 |
| Optical emission spectrometer | Checks chemistry before casting | 36.30 |
| Fume extraction and bag filter system | Captures furnace fumes and dust | 77.79 |
| Dross cooler and press | Recovers metal from hot dross | 36.30 |
| Total plant and machinery | 518.63 | |
Costs are the sample report's estimates for a 10 MT per day plant. Refractory relining of the furnaces is a recurring cost; get current quotations before you finalise.
Land, power, fuel and manpower for the plant
Furnaces run on natural gas, LPG or furnace oil, and the shredder, casting conveyor and bag filter fans need a sanctioned power load. Fuel and power together are the largest cost after raw materials in our sample.
| Land and site development | ₹69.08 lakh, with room for covered scrap storage away from the furnaces |
|---|---|
| Building and civil works | ₹265.54 lakh for the melt shop, scrap and ingot stores and office |
| Other fixed assets | ₹58.24 lakh for electrification, laboratory, furniture and a DG set |
| Power and fuel | ₹304.45 lakh in Year 3, about 6.1% of sales |
| Manpower | 110 people, with wages of ₹236.94 lakh in Year 1, including furnace operators, a spectrometer chemist and scrap sorters |
Licences and approvals for an aluminium scrap recycling plant
Two rules matter more here than for most metal units: hazardous waste handling for dross, and the new EPR regime for non-ferrous scrap. Checked as of October 2026.
| Business registration | Udyam (MSME) and GST registration; factory licence and fire NOC under state rules |
|---|---|
| Pollution board consent | Consent to establish and operate from the State Pollution Control Board. The category is set by each state; Odisha lists secondary non-ferrous production above 1 MT per hour as Red |
| Hazardous waste authorisation | Needed for dross residues and bag filter dust under the Hazardous and Other Wastes Rules, 2016. CPCB has an SOP for reuse of dross residues in alum making |
| EPR recycler registration | From 1 April 2026, recyclers of aluminium scrap must register on the CPCB portal, keep records of scrap received and recycled, and file half-yearly returns by 31 October and annual returns by 30 June |
| BIS certification | The 2023 Quality Control Order lists aluminium alloy ingots under IS 617. A BIS licence calls for an optical emission spectrometer or an approved shared or NABL lab; exports are exempt |
Start dates and categories change. Confirm with BIS, CPCB and your state board before applying.
Who buys aluminium alloy ingots made from scrap?
Most secondary ingot goes to pressure die casters that make two-wheeler, car, motor and fan parts. They buy grades such as ADC12 and LM6 against a fixed chemistry window and test every lot before charging it.
Policy now pushes demand toward recycled metal. Under the 2025 EPR rules, new aluminium products must use at least 5% recycled content from 2028-29, rising to 10% from 2029-30.
- Automotive and two-wheeler pressure die casters
- Gravity and sand foundries
- Electrical motor and fan housing makers
- Steel plants buying aluminium for deoxidation
- Metal traders and stockists
Where a new plant wins: a die caster that rejects one off-grade heat loses a shift. A plant that ships the same chemistry every lot, with a spectrometer certificate, keeps the order even against a cheaper supplier.
Mistakes that weaken an aluminium ingot from aluminium scrap project report
- One recovery figure for every scrap grade
Turnings and cans lose far more metal than extrusion offcuts. A single yield hides the real cost of the scrap mix you can actually buy.
- Ignoring the gap between scrap and ingot prices
Scrap is bought weeks before ingot is sold. If the aluminium price falls in between, the margin goes with it; the report should test that gap.
- Leaving out pollution control and dross disposal
Bag filters, fume ducts and authorised dross disposal are real costs. In our sample the fume and bag filter system alone is ₹77.79 lakh.
- Under-sizing working capital
Thirty days of scrap and 45 days of buyer credit add up fast. Our sample needs ₹725.53 lakh of working capital in Year 1 against a ₹544.15 lakh cash credit limit.
- No spectrometer in the budget
Without in-house chemistry checks, off-grade lots reach the customer and come back. Die casters and BIS both expect test results with every heat.
How NPCS helps you plan an aluminium ingot plant
- Scrap mix and recoverySet realistic yields for the scrap grades available near your site.
- Furnace and layout choiceCompare rotary, reverberatory and induction routes for your capacity.
- Bank-ready project reportProjections, DSCR, price sensitivity and working capital in your lender's format.
- Approvals planConsent, hazardous waste, EPR and BIS steps for your state and grade.
NPCS's client list shows 7 assignments for aluminium ingot from aluminium scrap projects and 116 across metal products, prepared for entrepreneurs and companies in India and abroad.
What's inside the aluminium ingot from aluminium scrap sample report
- Introduction
- Uses and applications
- Market potential
- Manufacturing process
- Raw materials
- Plant and machinery
- Land, building and utilities
- Manpower
- Licences and approvals
- Project cost and means of finance
- Working capital
- Projected profitability
- Cash flow statement
- Projected balance sheet
- Depreciation
- Term loan repayment
- Debt service coverage
- Break-even analysis
- Financial ratios
- Key assumptions
- Conclusion
- Monthly loan repayment schedule
19 pages, five-year projections, illustrative figures.
Open sample reportFree sample or a report for your project?
| What you get | Free sample | NPCS report for your project |
|---|---|---|
| Capacity and location | Typical unit | Your capacity, site and state |
| Figures | Illustrative | Built on current prices and quotations |
| Machinery suppliers and quotations | No | Yes |
| Market survey for your region | No | Yes |
| Bank or scheme format (PMEGP, term loan) | No | Yes |
| Use for a loan application | No | Yes |
What clients say about NPCS
4.7
264 Google reviews, as of 20 Oct 2026
Clients most often mention
- feasibility reports 18
- project report 16
- helpful for startups 15
- detailed reports 8
-
Excellent experience with Niir Project Consultancy Services. Their Techno-Economic Feasibility Reports are incredibly detailed and backed by solid market data.
Piyush Singh, Google review, 2026
-
Niir Project Consultancy Services offers excellent guidance for business setup. Their market survey and feasibility reports saved us a lot of time and helped us make informed decisions. Highly recommended
Saroj Yadav, Google review, 2026 View on Google
-
In an era of information overload, NIIR stands out for its precision. Their technical consultancy and market feasibility studies are world-class.
Shrishti Gautam, Google review, 2026
-
NIIR Project Consultancy Services provides useful books and reports for students, entrepreneurs, and small businesses. Their content is easy to understand and focuses on practical ideas for starting and managing industries. Overall, NIIR is helpful for learning about business and project planning.
Raj Yadav, Google review, 2026
Aluminium Ingot from Aluminium Scrap project report: frequently asked questions
How much does it cost to set up an aluminium ingot plant from scrap?
A small induction or crucible unit of 2–4 MT per day needs roughly ₹2–5 crore. A 10 MT per day rotary furnace plant needs about ₹10–14 crore, and a 30 MT per day plant ₹30 crore or more. Our sample report models a 10 MT per day plant at ₹1,155.85 lakh. These ranges are indicative; your report prices your own site and furnaces.
How much aluminium ingot do you get from one tonne of scrap?
It depends on the scrap. Clean extrusion offcuts and die-cast returns usually give the highest recovery, while painted, oily or thin scrap such as turnings and cans loses more metal to dross. As an indicative guide, recovery ranges from the mid-70s to the low-90s in per cent. A good report sets a separate yield for each scrap grade you plan to buy.
Which furnace is best for melting aluminium scrap?
A tilting rotary furnace suits mixed, painted or contaminated scrap because it melts under a salt flux and tumbles the charge. A reverberatory furnace suits clean, bulky scrap and is often used to hold and alloy the melt. Induction furnaces suit small batches of clean scrap. Our sample plant pairs a rotary melter with a reverberatory holding furnace.
Is BIS certification required for aluminium alloy ingots?
The Aluminium and Aluminium Alloys (Quality Control) Order, 2023 of the Ministry of Mines lists aluminium and aluminium alloy ingots under IS 617. Covered ingots need a BIS licence and the Standard Mark, except goods made for export. The start date has been amended more than once, so confirm the status for your grade with BIS before you plan sales.
Is an aluminium ingot from scrap business profitable?
It can be, but margins are thin per tonne because scrap is most of the cost. In our illustrative sample, a 10 MT per day plant earns a 15% return on investment in Year 3. It breaks even at about 50% of capacity and pays back in about 4.5 years. Scrap buying and metal recovery decide most of the result.
Which pollution category applies to an aluminium scrap melting unit?
Each State Pollution Control Board sets the category, and it usually depends on furnace type and scale. Odisha, for example, places secondary non-ferrous metal production above 1 MT per hour in its Red list. You also need hazardous waste authorisation for dross and bag filter dust, and from April 2026 a recycler registration on the CPCB EPR portal.
Is the aluminium ingot from aluminium scrap project report PDF free, and can I use it for a loan?
The sample is free to view and download. It is an illustrative report that shows the format and depth of an NPCS report. Its figures are representative and not based on a real project, so do not submit it to a bank. For a loan, NPCS prepares a report for your own capacity, scrap mix, location and lender.
Sources and references
- Aluminium and Aluminium Alloys (Quality Control) Order, 2023, S.O. 3846(E)Ministry of Mines, Gazette of India, checked Oct 2026
- Amendment to the Aluminium and Aluminium Alloys (Quality Control) Order, S.O. 1902(E)Ministry of Mines, Gazette of India, checked Oct 2026
- Product manual for aluminium and aluminium alloy ingots and castings, IS 617Bureau of Indian Standards, checked Oct 2026
- Hazardous and Other Wastes (Management and Transboundary Movement) Amendment Rules, 2025, G.S.R. 438(E)Ministry of Environment, Forest and Climate Change, checked Oct 2026
- SOP for utilisation of aluminium dross residues under Rule 9 of the Hazardous Waste RulesCentral Pollution Control Board, checked Oct 2026
- Categorisation of industrial sectors under Red categoryState Pollution Control Board, Odisha, checked Oct 2026
The NPCS project team, led by Ajay Kumar Gupta
This page and its sample report are prepared and reviewed by the NPCS project team, which has written techno-economic feasibility studies and detailed project reports since 1994.
Ajay Kumar Gupta founded Niir Project Consultancy Services (NPCS) and leads the organisation. With 40 years of experience in MSME project consulting, he has built the team that has delivered more than 28,000 project reports for clients worldwide, helping entrepreneurs plan and finance profitable manufacturing businesses.
- Published
- Last updated
- Next review
- Oct 2027
- Reviewed by
- NPCS project team
This page is reviewed every 12 months, or sooner when scheme limits, GST rates, BIS rules or pollution categories change. The sample report is illustrative: its figures are generated from industry-typical ratios for a unit of this size, checked so every statement balances, and are not taken from any client project.