What is a candle making project report?
A candle making project report is a detailed project report (DPR) for a unit that melts paraffin wax and moulds it into pillar, tealight and jar candles. It sets out the process, machinery, raw materials, market, project cost, means of finance, five-year projections, DSCR and break-even that a bank needs before lending.
Entrepreneurs use it to size the unit and apply for PMEGP or a term loan; bank officers use it to check that festival sales can carry the loan.
Also known as: candle manufacturing project report, candle making business plan, project report on candle making, DPR for a candle manufacturing unit.
What a bank checks in a candle making project report
A candle unit is simple to run, so lenders look hard at the cost lines that decide its margin. These are the values in our sample report and why each one gets questioned.
Wax is bought in bulk and priced off refinery rates. A report that shows a much lower share is usually pricing wax from an old quotation.
Paraffin prices move with crude oil. The report should test what a 10% rise in wax cost does to profit and DSCR.
Shrink film, printed cartons and glass jars cost far more for candles than power does, which is only 1.2% of sales in the sample.
DSCR (debt service coverage ratio) shows whether cash covers loan instalments. It dips in Year 2, when the first full year of repayment falls due.
Values are the assumptions in our illustrative sample. Your report uses figures for your capacity, wax supplier and product mix.
Candle making manufacturing plant cost in India
Cost depends on daily output, how many moulding machines you run and whether you buy land or rent a shed. The large tier is the unit in our sample report, making 780 kilograms (kg) of candles a day; the smaller tiers are indicative ranges.
Small unit
₹8–20 lakh
About 50–150 kg per day, plain and stick candles
- Moulds, melting tank, cooling₹3–8 lakh
- Shed deposit and fit-out (rented)₹2–5 lakh
- Working capital margin₹2–6 lakh
Fits PMEGP or Mudra, subject to limits
Mid-size unit
₹35–75 lakh
About 200–400 kg per day, adds tealights
- Machinery₹15–30 lakh
- Shed or small building₹10–30 lakh
- Working capital margin₹5–10 lakh
PMEGP up to ₹50 lakh, or a term loan with CGTMSE cover
Large unit
₹134.93 lakh
780 kg per day, 2,34,000 kg per year
- Plant and machinery₹55.46 lakh
- Land and building₹56.51 lakh
- Working capital margin₹10.26 lakh
Term loan ₹101.20 lakh (75%), promoter ₹33.73 lakh
The sample unit runs 300 days a year at 60% of capacity in Year 1, rising to 80% by Year 5. At a blended price of ₹212 per kg, it sells ₹347.26 lakh in Year 3 and keeps ₹25.13 lakh as net profit. Average DSCR over the loan is 1.62.
Small and mid-size ranges are indicative and exclude land unless stated. Sample figures are illustrative; the bank also gives a separate cash credit limit of ₹30.79 lakh.
Candle making manufacturing process
Moulded candles are made in seven stages. The same melting and blending line feeds pillar moulds, tealight cups and jars, so one unit can switch its mix with the season.
- Melting the base wax
Fully refined paraffin is melted with stearic acid in thermostatic tanks at about 70–80°C. Stearic acid hardens the candle and helps it release cleanly from metal moulds.
- Adding colour and fragrance
Dye goes in first, then fragrance oil weighed for each batch. Too much fragrance oil seeps out of paraffin as it sets and makes the flame smoke.
- Wicking
Braided cotton wick is threaded through pillar moulds, or crimped into a metal sustainer for tealights and jars. Wick size must match the candle's width, or it drowns or smokes.
- Pouring
Molten wax is poured into moulds, cups or jars at a steady temperature, since wax poured too hot shrinks more and cracks.
- Cooling and topping up
Chilled water around the moulds sets the wax evenly. As it shrinks, a hollow forms near the wick and is filled with a second pour.
- Ejection and finishing
Pillar candles are pushed out of the moulds, wicks are trimmed and bases levelled. Cracked or pitted candles are remelted, so wax is rarely lost.
- Burn test and packing
Candles from each batch are burn-tested for flame height, smoke and burn time, then shrink wrapped and packed in labelled cartons.
Raw materials for candle making
Paraffin wax is bought in slabs from refinery distributors, and the fully refined grade burns cleaner than semi-refined wax. Fragrance oils cost far more per kg than wax, so a scented range raises raw material cost faster than the table suggests.
| Raw material | Share of cost | Year 3 (₹ lakh) |
|---|---|---|
| Fully refined paraffin wax | 72% | 126.76 |
| Stearic acid | 9% | 15.85 |
| Fragrance oils | 9% | 15.85 |
| Braided cotton wick | 5% | 8.80 |
| Wax-soluble dyes | 3% | 5.28 |
| Aluminium tealight cups | 2% | 3.52 |
| Total | 100% | 176.06 |
Packing material (film, cartons, jars) is costed separately in the report at 9.4% of sales.
Candle making machine list and cost
Most candle machines are made by fabricators in India and are semi-automatic, so labour, not power, is the bigger running cost. The pillar moulding machine is the largest item in the sample.
| Machine | What it does | Sample cost (₹ lakh) |
|---|---|---|
| Thermostatic wax melting tanks | Melt and hold wax at pouring temperature | 7.76 |
| Semi-automatic pillar candle moulding machine | Multi-cavity moulds with push-up ejection | 16.64 |
| Tealight filling machine | Fills wax into aluminium cups | 6.66 |
| Wick cutting and sustainer crimping machine | Cuts wick and fixes metal tabs | 3.33 |
| Water chiller and cooling tanks | Sets candles evenly and faster | 6.65 |
| Jar candle filling station | Doses scented wax into glass jars | 4.44 |
| Trimming and finishing tables | Wick trimming and base levelling | 3.33 |
| Shrink wrapping and carton packing machine | Wraps and cartons finished candles | 6.65 |
| Total plant and machinery | 55.46 | |
Costs are the sample report's estimates for a 780 kg per day line. Get current quotations before you finalise.
Who buys candles, and when
Candle demand is steady through the year from households, churches and temples, then rises sharply before Diwali and Christmas. Plain white candles sell on price per kg to stockists. Scented, jar and tealight candles sell on fragrance, finish and packaging, and carry better margins.
- Wholesale distributors and kirana stockists
- Churches, temples and religious institutions
- Gift shops and home decor stores
- Online marketplace sellers and D2C candle brands
- Hotels, restaurants and event decorators
- Corporate gifting buyers before Diwali
Plan for the festival peak: buyers place Diwali orders weeks ahead, so a candle unit builds stock through the monsoon months. That stock needs wax bought early and a cash credit limit sized for it, not just for an average month.
Licences, GST and approvals for a candle unit
Candle making has a light approvals list compared with most manufacturing. These are the items to plan for, as checked in October 2026.
| Business registration | Udyam (MSME) registration and GST registration |
|---|---|
| GST and HSN code | HSN 3406 (candles, tapers and the like), taxed at 5% since 22 September 2025, down from 12% |
| Pollution board | Candle making is in the White (practically non-polluting) category in state lists such as Maharashtra and Tamil Nadu; consent is by self-certification where the state follows the 2024 procedure |
| Packaged goods | Registration as manufacturer or packer with the state Legal Metrology department, and label declarations such as net quantity and price on every pack |
| Brand | Trademark registration for your brand name; candles fall in Class 4 |
| Factory and fire safety | Factory licence where the workforce threshold under labour law applies, and a fire safety NOC where the local authority requires one, since molten wax is a fire risk |
Loans and schemes for a candle making unit
Most candle units fall within PMEGP or Mudra limits at start-up. Larger units like the one in our sample take an MSME term loan.
PMEGP
Manufacturing projects up to ₹50 lakhMargin-money subsidy of 15–35% for new units, with 5–10% own contribution. Suits a small or mid-size candle unit.
Mudra
Tarun loans up to ₹10 lakhFor a first unit with moulds and a melting tank. Tarun Plus goes up to ₹20 lakh once a Tarun loan is repaid.
MSME term loan with CGTMSE
Guarantee cover up to ₹10 croreCollateral-free cover for eligible micro and small units, for larger lines with land and building.
Scheme limits change. Confirm current terms with the bank or the scheme portal before applying.
Mistakes that weaken a candle making project report
- Pricing all output at gift-shop rates
Retail prices for scented jars are many times the ex-factory rate for plain candles. Revenue must use the blended price a stockist actually pays.
- Working capital sized for an average month
Festival stock built from July to October needs far more wax and cash than a flat estimate. The unit then runs short just before its best season.
- Leaving out fragrance and jar costs
A report costed on wax alone looks profitable until scented lines start. Fragrance oils and glass jars must be priced for the planned mix.
- No fire safety in the layout
Melting tanks need distance from packing stores and the right extinguishers. Lenders and insurers ask for it, and a gap can delay the fire NOC.
How NPCS helps you set up a candle making unit
- Product mix and capacityBalance plain, tealight, pillar and scented jar candles for your market and season.
- Machinery and wax sourcingCompare moulding and filling machines and plan wax buying ahead of the festival peak.
- Bank-ready project reportProjections, DSCR and a working capital limit sized for seasonal stock, in your lender's format.
- Approvals and layoutPollution category, Legal Metrology, fire safety layout and the approvals list for your state.
NPCS's published client list includes 2 candle making assignments and 18 in agarbatti, candles, wax and pooja products. The NPCS project team, led by founder Ajay Kumar Gupta, has prepared project reports since 1994.
What's inside the candle making 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 |
Real NPCS candle making project reports
These are candle making project reports NPCS has prepared, with the plant capacity, total capital investment, rate of return and break-even worked out in each. Costs have moved since some were written, so we bring any of them up to date for your capacity and location.
| Project report | Plant capacity | Total investment | Rate of return | Break-even | Action |
|---|---|---|---|---|---|
| Mosquito Repellent Candles | 500 Kg./Day | ₹39 lakh | 58% | 32% | Get this report |
| Candle Making | 500 Kgs/Day | ₹42 lakh | 58.4% | 37.4% | Get this report |
Figures as worked out in each NPCS report. Total investment includes plant and machinery, land and building, and working capital.
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Candle Making project report: frequently asked questions
How much does it cost to start a candle making business in India?
A small semi-automatic unit in a rented shed needs roughly ₹8–20 lakh, and a mid-size unit making 200–400 kg a day about ₹35–75 lakh. Our sample report models a 780 kg per day unit with its own land and building at ₹134.93 lakh. These are indicative ranges; your project report works out the cost for your capacity, product mix and location.
Is candle making business profitable?
It can be, if wax buying and the product mix are right. In our illustrative sample, a 780 kg per day unit selling at a blended ₹212 per kg earns a 19% return on investment in Year 3. It breaks even at 49% of capacity and pays back in about 4 years. Plain candles earn thin margins; scented and jar candles carry more.
Which machines are needed for candle making?
A small unit needs thermostatic wax melting tanks, pillar or stick candle moulding machines, a water cooling arrangement and a trimming table. Units that make tealights and jar candles add a tealight filling machine, a wick sustainer crimping machine and a jar filling station. Shrink wrapping and carton packing equipment completes the line.
Which wax is best for candles, paraffin or soy?
Fully refined paraffin wax is the standard for plain, pillar and tealight candles in India because it is cheaper, easy to mould and holds colour well. Soy and other vegetable waxes are softer, suit container candles and sell at a premium, but cost more per kg. Many units run paraffin as the base and add a soy or blended line for gifting.
What is the HSN code and GST rate for candles?
Candles fall under HSN heading 3406, which covers candles, tapers and the like. The GST rate on this heading was cut from 12% to 5% with effect from 22 September 2025, following the 56th GST Council meeting. Check the current rate with your tax adviser before you finalise prices, because rates can change.
Candle making business kaise shuru kare?
Start by deciding your product mix, such as plain, tealight, pillar or scented jar candles. Then register under Udyam and GST, check your state pollution board category and get Legal Metrology registration for packed candles. Buy moulds and a melting tank, and prepare a project report if you need a PMEGP or bank loan.
Is the sample report 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 it should not be submitted to a bank. For a loan, NPCS prepares a report for your own capacity, location and loan scheme.
Sources and references
- Recommendations of the 56th meeting of the GST Council (Annexure II: candles, 12% to 5%)GST Council, Ministry of Finance (PIB release), checked Oct 2026
- Prime Minister's Employment Generation Programme (PMEGP)Bank of India, checked Oct 2026
- PMMY Mudra Tarun PlusIndian Bank, checked Oct 2026
- Credit Guarantee Fund Trust for Micro and Small EnterprisesCGTMSE, checked Oct 2026
- White category industries list (item 22, candle making)Maharashtra Pollution Control Board, checked Oct 2026
- Circular on White category industries and self-certified consentMaharashtra Pollution Control Board, checked Oct 2026
- Types of industries categorised under White category (item 40, wax candles)Tamil Nadu Pollution Control Board, checked Oct 2026
- Registration of manufacturing and packing of packaged commoditiesLegal Metrology Department, Government of Goa, 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.