model detailed project report tea processing
TRANSCRIPT
MODEL DETAILED PROJECT REPORT
TEA PROCESSING
Disclaimer: This is just a model DPR prepared based on assumptions for reference purpose
only. The project cost and financial projections may vary project to project as per technology
selection, nature of civil work, price of raw materials etc.
PROJECT AT A GLANCE ..............................................................................................3
INTRODUCTION .............................................................................................................4
1. BACKGROUND ..............................................................................................5
2. PROJECT BACKGROUND ...........................................................................6
3. ORGANIZATIONAL AND PROMOTERS DETAILS .....................................6
4. PROJECT DESCRIPTION & FLOW SHEET: ...............................................8
5. PROCUREMENT STRATEGY OF RAW MATERIAL & OTHER INPUTS . 10
6. MARKETING STRATEGY ........................................................................... 10
7. LAND DETAILS ............................................................................................ 10
8. PROJECT COST .......................................................................................... 12
9. FINANCIAL ANALYSIS ............................................................................... 15
10. PROJECT IMPACT ...................................................................................... 27
11. RECOMMENDATION ................................................................................... 28
Project at a Glance
1. Name of the Unit :
2. Constitution :
3. Date of Incorporation :
4. CIN :
5. PAN :
6. GST
7. Registered Office :
8. Factory Address :
9. Name of Directors :
10. Type of Unit :
11. Nature of Project : Tea Processing
12. Installed Capacity at 100%
Capacity Utilisation
:
13. Cost of the Project :
14. Promoter’s Contribution :
15. Proposed Term Loan/
Government Grant
:
16. Requirement of Cash Credit
Limit
:
17. Proposed Employment :
18. Power Load :
19. Financial Indicators :
Introduction Tea Processing is a very important industrial activity in India, which is a major producer, consumer and
exporter of tea worldwide. Tea is a natural beverage brewed from the young leaves of an evergreen plant
Camellia Sinensis. Tea gardens and tea industries are scattered in different parts of India. Tea is grown in
few districts of Assam, West Bengal, Kerala, Karnataka and Tamil Nadu and partially in Tripura, Uttar
Pradesh and Himachal Pradesh. Though, tea is commercially cultivated in around 16 states in India, out
of which, Assam (52.0%), West Bengal (21.9%), Tamil Nadu (14.6 %) and Kerala (7.1%) produces more
than 95% of the total tea in the country.
There are other traditional and non-traditional states where tea is produced in small extents viz. Tripura,
Karnataka, Uttaranchal, Himachal Pradesh, Arunachal Pradesh, Manipur, Meghalaya, Mizoram,
Nagaland, Sikkim, Odisha and Bihar. Tea production in smallholding has been growing in India and
worldwide.
The Tea Board of India has recently decided to approve setting up of mini and micro factories by the
small tea growers within their plantation areas, in order to improve plucking standards and retain natural
garden freshness. This would help in improving the quality of processed tea from green leaves of small
tea gardens. Usually, as the time needed for transporting green tea leaves from the gardens to factories
will be reduced. It will also help retain the garden freshness of the green leaves.
The Tea Board, which has defined 'micro' as factories having capacity of upto 200 kg and 'mini' as
factories having processing capacity of upto 500 kg a day, has also decided to provide 40 per cent
subsidy on the cost of plant and machinery to such growers. The small tea growers will have to obtain
biometric cards to avail the various benefits offered by the Tea Board. Small tea growers can set up mini
tea processing factories, which may reduce tension of marketing of green leaf. Besides this, unemployed
youths also can grab the opportunity to set up mini-factories on the support of financial institution. The
mini and micro factories will open up a huge chain of employment opportunities at the garden level.
This project profile is for setting up of a Mini Tea Factory with installed processing capacity of 100 Ton of
Processed Tea, based on 200 working days per annum and 8 working hours per day1.
1 Bihar Economic Survey 2019-20
1. Background
Tea is India's primary beverage with almost 85% of Total households in the country consuming
tea. Demand supply gap has been increasing in India in recent years. While tea consumption has
been growing at 3-3.5% every year, there has been no significant increase in plantation land in
the last few years as per the market survey report. Tea trading in India is done in two ways -
auction and private selling. Market reports are obtained from six major auction centres in India -
Kolkata, Guwahati, Silguri, Cochin, Coonoor and Coimbatore where bulk trading is carried out
through the suctions held in these centres.
The Cottage made CTC Tea has great demand among the consumers due to its special
manufacturing process, which imparts its quality and aroma. Besides, cottage organic Tea (CTC
and Orthodox), Green-Tea may be produced, which has great market potential. Therefore, few
cottage tea factory could be set up in concentrated tea growing areas that will have a steady
market for its products.
• The main benefits of tea: High in Antioxidants, authentic taste and are comparatively
more rich in flavor and colour.
• Processing of Hand Crafted Tea: Sorting the leaves by grade, Spreading out to wither,
Shaking in woven bamboo baskets to bruise leaf edges and speed up oxidation, drying
and pressing the leaves in a wok over a fire, hand-rolling the leaves, pressing wet leaves
into cake molds or presses and sewing leaves together.
• Potential Enterprises: Teabags, loose tea, compressed tea, Instant tea, bottled and
canned tea, processed tea for industrial use (cosmetics, pharmaceuticals, food
processing, etc.)
Market Promotion plays a vital role for the generation of the potential customers therefore,
application of marketing strategies are recommended. Marketing plan of the proposed project
may include good quality maintenance, promotional campaign like offering special discounts,
referrals, advertisement and tying up with buying houses.
.
2. Project Background
The proposed unit is of 150 MT per annum and will be set up at _________. The main product istea.
Current status of the unit:
a. Items to be manufactured: Tea
b. Capacity of the plant: 150 MT/annum.
c. Source of power generation/electricity: Electricity form BSPHCL/SBPDCL, DG Set
d. Source of water supply:Own Borewell
e. Connectivity to road/railways:NH/SH details along with distance
f. Mode of transport:Pickup/Truck/Others
g. Market:Details of local market/other market
h. Employment Generation:13 nos. directly.
i. Marketing:Tea will be sold in 100 gm, 250 gm, 500 gm and 1 kg packs
j. Waste disposal:
3. Organizational and Promoters Details
Organizational details
The M/s XYZ is a proprietorship/partnership/private company is associated with …………….. for about 10
years. The unit was incorporated on ……………… as private limited company under Company’s Act. The
authorized capital of the company is Rs. ….. lakh and the paid-up capital is Rs. ….. as on ………….The
details of the unit as per MCA website (only for private/public ltd. companies) are given below:
Company Master Data
CIN
Company / LLP Name
ROC Code
Registration Number
Company Category
Company Sub-Category
Class of Company
Authorized Capital(Rs)
Paid up Capital(Rs)
Number of Members(Applicable in case of company without Share Capital)
Company Master Data
Date of Incorporation
Registered Address
Email Id
Whether Listed or not
Date of last AGM
Date of Balance Sheet
Company Status(for e-filing)
Directors/Signatory Details
DIN/PAN Name Begin date End date
Promoters’ Background
The unit is a proprietorship/partnership/private limited company/ firm and the
proprietor/partners/promoters of the firm has experience in trading/processing of……………………..and is
associated processors. He/They has/have identified Tea Processing a profitable business seeing its ever-
increasing demand in the local market as well market in the neighboring districts and States. Brief profile
of the proprietor/partners/promoters is given below:
Brief profile of promoters is given below:
a) Mr. ABC
b) Mrs. XYZ
c) Mr. DEF
Networth: The details of the networth of the unit is given below:
Particulars Rs. In lakh
Movable assets A
B
C
Subtotal (A)
Immovable assets A
B
C
Subtotal (B)
Total
The total net-worth is more than the proposed grant of the unit.
4. Project Description & Flow Sheet:
The process of manufacturing CTC tea comprises of the following different process.
• Spreading the leaf on Withering Trough: The collected Green Leaf is spread upon the
withering trough, while spreading due emphasis is laid upon to remove source and old dried
leaves so that it will help to minimize the presence of stalks and help in producing fine tea.
• Withering: The process of withering involves partial removal of moisture from fresh leaf and is
carried out in order to condition the leaf physically for subsequent processing. Besides, some
chemical changes also take place during withering and these are independent of the physical
process. Thus, withering involves (a) Physical wither and (b) Chemical wither. While the physical
wither can be completed even in 3-4 hours, however for completion of the chemical wither, a
period of 12-16 hours is required as such the withering trough can't normally be used more than
once a day. Withering is carried out either by Natural Withering or by Trough withering system.
The green leaves that are spread upon the wire mess of withering trough are charged with cold
and warm air through an axial flow fan so that the moisture content is reduced to the desired
level. Generally, the level of reduction in moisture depends upon the grades and quality of tea,
which is to be manufactured.
• Rolling / Rotorvane: The withered leaves are rolled to rupture the leaf cells and release of
enzymes and to give a twist to the leaf. It is achieved by processing withered leaf in Rotorvane.
During rolling operation chemical changes among the principal constituents of leaf start as soon
as the juice of leaf is squeezed out in contact with the air. The chemical changes are caused by
the enzyme present in the leaf. The enzyme brings about chemical changes, but it does not
change itself. Generally, leaf is rolled in Rotorvane before send to further processing.
• Operating on C.T.C Machines: After the leaves are rolled, they are put into the C.T.C machine
(i.e. cutting, tearing and curling machine). This machine cuts the leaf into uniform size with
maximum cell distortion leading to quicker and more even oxidation during fermentation. The
C.T.C machine is comprised of two rollers rotating in opposite directions at the arranged speed.
The speed of the two rollers are different, one of the roller is fast rotating at a speed of around
675 revolutions per minute, whereas the slow roller rotates at a speed of 60 to 73 revolutions per
minute. Generally, a constant clearance between the rollers is maintained. The roller segment is
in sharp condition, which cut the leaves three times. During the process it is specifically seen that
leaves are not heated as it destroys briskness and quality.
• Fermenting: After processing in the C.T.C machine the leaves are fermented. Fermentation of
the tea leaf is a very important process in Tea manufacture for briskness, strength, colour and
quality largely depend upon it. The duration of fermentation varies according to rise and fall of
temperature. A temperature of 76'F to 78'F represents the ideal temperature of the fermenting
room and it takes roughly between 1 to 2 hours in the fermenting process. The leaf processed in
C.T.C is spread on the fermenting floor or fermenting bed of fermenting machine. Generally, they
are spread at a thickness of half an inch. Fermentation begins as soon as the juice of the leaf
come in contact with the air, enzyme present in the leaf bring about chemical changes among the
constituents of the leaf cell such as latechins (polypheno's) and caffeine. When the leaf become
bright red in the fermenting room it is the best time to transfer to the drying room for firing.
• Drying: After the requisite level of fermentation CTC leaf is transferred to the drying room where
the leaf is fed on the trays of mechanical dryers and fermented leaf is fired at an inlet temperature
of 200'F to 220'F to arrest fermentation process and to remove additional moisture present. The
exhaust temperature being 120'F to 135'F.
The thickness of spreading of CTC leaf being one fourth of inch. The fair revolution of the quality
drying machine should be 350 and the tray speed is 200. The final moisture contained of the tea
is kept at around 3%.
• Sorting: The sorting process of the CTC leaf is very simple. At first tea is allowed to pass through
the sorter for separation of grades, during this process tea is also made free from any foreign
material, fibre and other proper grading which depend largely on size (granule) of tea. After
grading tea is packed in tea chest/jute bags of standard size and sent to the auction centre.
Manufacturing Process
5. Procurement strategy of raw material & other inputs
Unknown to many, Bihar is home to commercially produced tea with the same being produced in
Kishanganj and nearby districts and Kishanganj being the lone district in the State with largest area under
tea plantation. The total cultivated area under tea is about 10,000 ha with a production of around 10,000
MT. Hilly terrain, cool climate, favorable soil quality and natural drainage system are some of the key
features of the region which supports tea cultivation. Presently there are 9 tea processing units (one
owned by government and rest being privately owned).
The total cultivated area under tea is about 1,600 Ha spread over three blocks, viz., Pothia, Thakurganj
and Kishanganj. Hilly terrain, cool climate, favorable soil quality and natural drainage system are some of
the key features of the region which supports tea cultivation. Unit has proposed to procure tea leaves
from Kishanganj and adjoining districts.
6. Marketing strategy
The rising number of health-conscious consumers of green tea and tea leaves is giving a boost to tea
industries. Today markets are flooded with a large variety of tea juices. The main reason for increased
consumption is rising level of health consciousness among consumers. Factors like preferred choice of
easy availability, convenience, naturalness and marketing strategies have given tea industry a booming
growth.
With changing lifestyles and increase in disposable incomes, the demand for tea is ever increasing.
Besides consumption in the households, it is served in hotels, restaurants, clubs, airlines, railways, local
tea stalls etc.
Quality should be emphasized at each step right from the beginning to the marketing of the Product. Over
the years, an image of high-quality products should be cultivated. The effectiveness of distribution
coverage and practice is of paramount importance in achieving the desired sales. Understanding of the
distribution channels is crucial for the manufacturer to plan and implement an effective distribution
strategy. Distribution network should be given extra emphasis. Market share could be gained by
enhancing retailer, and distributor margins.
Promoters would appoint distributors in targeted towns of Bihar and surrounding states like West Bengal,
Jharkhand, Uttar Pradesh. Contacts with retailers of similar kinds will be made and products would be
sold in the market with help of them. The product made in this unit will be in the line with top range of
products with better quality at the same time cost effective. Company would be sharing more profits with
the distributors and retailers.
Company will also explore possibility of marketing their produce to retails shops like Big Bazar, Reliance
Trends, Malls etc. It will also try to partnership with local and other hotels and restaurants with good offers
to attract demand of its product. It is assumed that due high quality, cost effectiveness and aesthetic
packaging, sale of products may not face much problems.
7. Land Details
Land Details
In order to set up a modern biscuit manufacturing unit of the proposed capacity, a land size of approx.
_________ would be ideal however this may vary with increase in capacity.
The land proposed for the unit Details of the proposed land is given below:
Sale deed dated _______ in the name of M/s XYZ with sale value Rs. 0.00/-
Khata no. Plot no. Area Boundary
Total 19 decimals
The total land area is …… decimal and is in the name of the of the proprietor/firm/company. The
proposed land of the unit is an industrial land as per CLU dated …… Character of the land. The cost of
the land is Rs. ……. lakh/ the proposed land is a leased land for a period of …………. years.
8. Project Cost
The proposed project cost of the unit is Rs. 111.00 lakh, the details of the project cost is given below:
Project Cost
S. No Particulars Amount
(Rs. Lakh) % of total
project cost
1 Land - 0.00%
2 Land development 4.00 3.60%
3 Building and civil works 30.00 27.03%
4 Plant and Machinery 35.00 31.53%
5 Misc. fixed assets 20.00 18.02%
6 Preliminary and Pre-operative Expenses 6.00 5.41%
7 Contingency& escalation 6.00 5.41%
8 Margin Money for Working Capital 10.00 9.01% Total 111.00 100.00%
a. Investment in land and land development
▪ Investment in land: Proposed land of the project is taken on long term lease and
hence no cost has been considered towards cost of the land in the project.
▪ Investment in land development work: The total investment in land development work
is Rs.4.00 lakh which is 3.60% of the total project cost. However as per scheme
guidelines Rs.2.78 lakh @2.5% of the project costis lowest and hence is
considered for grant-in-aid calculation.
b. Investment in civil work
The Master Plan has been prepared in accordance with the requirement of the project. Based on
the requirement of machines and equipment, the facilities have been planned and user amenities
integrated.The planning of the building structures and infrastructure facilities has been done
keeping in view the entire functional requirements and location of the various units in the site has
been fixed to facilitate smooth process flow. Proposed master plan meets all plot development
and planning norms are as per Standards of the State Govt. Built-up area and open space has
been considered as per local bye-laws applicable for industrial buildings.
Promoters propose to construct factory building, office cum store, staff quarter and genset room.
The proposed estimate is Rs. 34.00 lakh, and the details are given below:
*Proposed Civil Work details:
Proposed civil work
S. No Component Area
(sq. ft.) Amount
(Rs. Lakh)
1. Land Development LS 4.00
2. Factory building 2000 15.00
3. Office cum store building 1500 7.50
4. Staff quarter 1200 6.00
5. Genset room 400 1.50
Total 34.00
(*Note: Factory building either be RCC or PEB structure so the layout plan and cost may vary
project to project same will be captured in an applicant’s DPR):
Plant & machinery
The company proposes to installlatest and standard machines from the reputed
Indian/International manufacturers. The total proposed investment in plant & machinery is Rs.
35.00 lakh including Effluent Treatment Plant. Details of the proposed machinery is given below:
Plant & machinery
S. No. Name ofthe machinery Amount
(Rs. Lakh)
1 SS Rotorvane 8"
28.00
2 CTC Machine (3 CUT) 3
3 Pair 8" Roller (8-10-8 TPI)
4 DF Furnace
5 Drier (Conventional)
6 Humidifier
7 Mydelton Sorter
8 Fibre Sorter
9 Vibro Sorter
10 Miscellaneous Equipment
11 Add: Taxes, transportation and installation etc @ 20%
7.00
Total 35.00
*The make and specification of P&M may vary project to project based on the quotations from
different suppliers.
As per scheme guidelines Rs. 35.00 lakh has been considered towards grant-in-aid calculation.
Misc. Fixed Assets
In order to ensure smooth operation of the unit, it would also require certain miscellaneous fixed
assets apart from above listed plant &machinery. The miscellaneous fixed assets would include
electrical load security & transformer, DG set, furniture and fixtures, etc. Cost of these assets is
estimated to be Rs. 20.00 lakh.
Plant & machinery
S. No. Name of the machinery Amount
(Rs. Lakh)
1 Electrical Load Security and Transformer 8.00
2 DG Set 6.00
3 Furniture’s and Fixtures 1.00
4 Miscellaneous items 2.00
5 Add: Taxes, transportation and installation etc @ 20%
3.00
Total 20.00
Preliminary & pre-operative expenses
The provision towards preliminary & pre-operative expenses includes expenditure towards like
salaries & administrative expenses, travel expenses, market development expenses, interest
during construction period etc. The Miscellaneous charges include the cost incurred towards
Administration, Travelling, Market development and other marketing activities.
Contingency
Amount proposed to be invested towards contingency is Rs. 6.00 lakh
Margin money for the working capital
We have worked out the margin money for working capital requirement as per project need and
its smooth operation, the proposed amount of margin money is Rs.1.57 lakh. Detail is given in the
financial section of the report.
Electricity
The unit will require power load of ……… KVA from North/South Bihar Power Distribution
Company Ltd. for this project. Estimate of power requirement is enclosed with the financial part of
this report.
Water
The estimated water consumption is approx. 10 KL per day and two deep bore wells would be
required to meet water requirement of the unit.
Manpower
An estimate of manpower requirement has been prepared based on the equipment and
operations involved. An estimate of manpower cost is given below:
S. No Particulars No of
Employee Monthly Salary
Total Salary Per Month
(Rs.)
Total Salary Per Annum
(Rs.)
A Technical Staff
1 Production Manager 1 15,000 15,000 180,000
2 Marketing & sales personnel
2 10,000 10,000 120,000
3 Administrative Officer cum Accountant
1 12,000 24,000 288,000
4 Machine Operators/ Skilled Workers
3 10,000 30,000 360,000
5 Unskilled worker 4 8,000 32,000 384,000
6 Peon/ Security Guard 2 8,000 16,000 192,000
Add PF, ESI & Other benefits etc @15% -
Total Direct Wages 15,24,000
Total Direct Wages (Rs. In lakh) 1.41 15.24
9. Financial Analysis
Assumption
Capacity assessment
Production per annum at 100% capacity 225 MT
No. of working days 250
Capacity assumptions
Product mix 100% 225 MT
Tea 40% 90 MT
Loss 60% 135 MT
Total annual install capacity - 225 MT
Working Capital Requirements
S. No Particular Stocking Period
in Month IstYr 2nd Yr 3rd Yr 4th Yr 5th Yr
1 Raw Materials 1.00 5.63 6.09 6.56 7.03 7.50
2 Consumable Stores & Packing Material 1.25 0.00 0.00 0.00 0.00 0.00
3 Finished Goods 0.50 3.70 3.70 5.55 5.55 5.55
4 Receivables 0.25 2.00 2.25 2.39 2.60 2.78
5 Expenses for One Month 0.50 0.77 0.84 0.93 1.02 1.12
Total Current Assets 12.10 12.89 15.43 16.20 16.95
6 Less: Sundry Creditors 1.00 6.09 6.13 6.60 7.07 7.54
7 Working Capital Gap 6.00 6.76 8.83 9.13 9.41
8 Total Required Margin 1.50 1.69 2.21 2.28 2.35
9 Permissible Bank Finance 4.50 5.07 6.62 6.85 7.06
10 Actual Bank Borrowing 5.00 5.00 5.00 5.00 5.00
on Stock 3.00 3.00 3.00 3.00 3.00
on Book Debts 2.00 2.00 2.00 2.00 2.00
11 Actual Margin 1.00 1.76 3.83 4.13 4.41
Revenue Projections
Sl No Particulars IstYr 2nd Yr 3rd Yr 4th Yr 5th Yr
1 Installed Capacity (In MT) 225 225 225 225 225
2 Product Mix
100% 100% 100% 100% 100%
Tea 40% 40% 40% 40% 40%
Loss 60% 60% 60% 60% 60%
3 Product wise capacity 225 225 225 225 225
Tea-60% 90 90 90 90 90
Loss-40% 135 135 135 135 135
4 Capacity Utilisation 60% 65% 70% 75% 80%
Production (In MT)
Juice
Actual Production 54.00 58.50 63.00 67.50 72.00
Add: Opening Stock of FG (In MT) - 2.00 2.00 3.00 3.00
Less: Closing Stock of FG (In MT) 2.00 2.00 3.00 3.00 3.00
Value of Opening Stock (Rs. In lacs) - 3.84 3.84 5.76 5.76
Value of Closing Stock (Rs. In lacs) 3.84 3.84 5.76 5.76 5.76
Quantity to be sold (In MT) 52.00 58.50 62.00 67.50 72.00
Selling Rate per MT 192,000.00 192,000.00 192,000.00 192,000.00 192,000.00
Sales Value (Rs. In lacs) (A) 99.84 112.32 119.04 129.60 138.24
5 Total Sales Value (Rs. In lacs) (A) 99.84 112.32 119.04 129.60 138.24
6
Closing Stock of Finished Goods (Rs. In lacs) 3.84 3.84 5.76 5.76 5.76
Fund Flow Statement
SL. NO.
PARTICULAR
IstYr 2nd Yr 3rd Yr 4th Yr 5th Yr
CASH INFLOW
1 Profit before Tax 22.28
31.28
39.36
48.20
55.86
2 Add:-Depereciation 10.79
9.45
8.27
7.25
6.36
3 PrilimineryExps. W.O. - - - - -
4 Cash Accurals (1+2+3) 33.07
40.73
47.63
55.45
62.22
5 Receipt of capital subsidy from Bihar Govt.
6 Increase/(Decrease) in C.L. 5.08
0.03
0.39
0.39
0.39
7 Contribution by Shareholder/Promoter 27.75 - - - -
8 Increase in Term Loan from Bank 83.25
9 Increase in Un. Sec. Loan
10 Increase in Working Capital 5.00 - - - -
A.Total (Rs.)(4 to 14) 154.15
40.76
48.02
55.84
62.61
CASH OUTFLOW
1 Preliminery& Preoperative Expenses -
2 Increase in Current Asset 40.22
16.46
18.92
23.00
23.78
3 Increase in Cap. Expenditure 89.96
4 Decrease in Term Loan 11.89
11.89
11.89
11.89
11.89
5 Investment - - - - -
6 Dividend Paid - - - - -
7 Income Tax Paid 7.57
10.63
13.38
16.38
18.99
B.Total (Rs.) (1 to 9) 149.64
38.99
44.19
51.28
54.66
C.Surplus/Deficit from Project (A-B) 4.50
1.77
3.83
4.56
7.95
D. Opening Balance of Cash & Cash Equivalent - 4.50
6.28
10.10
14.67
E. Closing Balance of Cash & Cash Equivalent(C+D)
4.50
6.28
10.10
14.67
22.62
Balance Sheet Cash & Bank 4.50 6.28 10.10 14.67 22.62
Projected Balance Sheet
Amount in lacs
Particulars IstYr 2nd Yr 3rd Yr 4th Yr 5th Yr
Liabilities
Capital 27.75 27.75 27.75 27.75 27.75
Reserve & Surplus 14.70 35.35 61.33 93.15 130.02
Term Loan 71.36 59.46 47.57 35.68 23.79
Bank Borrowing for Working Capital 5.00 5.00 5.00 5.00 5.00
Sundry Creditors 5.08 5.11 5.50 5.89 6.28
Provision for Taxation 7.57 10.63 13.38 16.38 18.99
Total 131.46 143.31 160.53 183.85 211.83
Assets
Gross Block 89.96 89.96 89.96 89.96 89.96
Less- Accumulated Deprection 10.79 20.24 28.51 35.76 42.12
Net Block 79.17 69.72 61.45 54.20 47.84
Current Assets
Inventory
Raw Materials 4.69 5.08 5.47 5.86 6.25
Consumables Stores & Packing Materials 0.00 0.00 0.00 0.00 0.00
Closing Stock 3.84 3.84 5.76 5.76 5.76
Projected Balance Sheet
Amount in lacs
Particulars IstYr 2nd Yr 3rd Yr 4th Yr 5th Yr
Receivables 2.08 2.34 2.48 2.70 2.88
Other Current Assets
Taxation Advance 7.57 10.63 13.38 16.38 18.99
Other Current Assets 29.61 45.42 61.89 84.28 107.49
Cash & Bank Balances 4.50 6.28 10.10 14.67 22.62
Miscellaneous Expenditure (not w/o) - - - - -
Total 131.46 143.31 160.53 183.86 211.83
Statement of Profitability
Particulars IstYr 2nd Yr 3rd Yr 4th Yr 5th Yr
Sales 99.84 112.32 119.04 129.60 138.24
Less- Duty & Taxes - - - - -
Net Sales 99.84 112.32 119.04 129.60 138.24
Other Income 12.00 15.00 18.00 22.00 25.00
Total 111.84 127.32 137.04 151.60 163.24
Variable Cost
Raw Materials Consumed 56.25 60.94 65.63 70.31 75.00
Consumables & Packing Materials 0.00 0.00 0.01 0.01 0.01
Statement of Profitability
Particulars IstYr 2nd Yr 3rd Yr 4th Yr 5th Yr
Wages & Salary 15.24 15.24 16.00 16.80 17.64
Power 2.27 2.51 2.76 3.02 3.28
Repair & Maintenance 0.15 0.17 0.18 0.20 0.22
Other Manufacturing Expenses 0.25 0.30 0.36 0.43 0.52
Cost of Production 74.17 79.16 84.93 90.77 96.67
Add: Opening Stock of Finished Goods - 3.84 3.84 5.76 5.76
Less: Closing Stock of Finished Goods 3.84 3.84 5.76 5.76 5.76
Cost of Sales 70.33 79.16 83.01 90.77 96.67
Gross Profit :- 41.51 48.16 54.03 60.83 66.57
Selling & Administrative Expenses 0.50 0.56 0.60 0.65 0.69
- Other Selling & Adm. Exps. 0.50 0.56 0.60 0.65 0.69
Profit before Interest & Depreciation 41.01 47.60 53.43 60.18 65.88
Depreciation 10.79 9.45 8.27 7.25 6.36
Profit before Interest & Taxation 30.22 38.15 45.16 52.93 59.52
Interest on
Term Loan 7.49 6.42 5.35 4.28 3.21
Working Capital 0.45 0.45 0.45 0.45 0.45
Total Interest 7.94 6.87 5.80 4.73 3.66
Profit before Taxation 22.28 31.28 39.36 48.20 55.86
Statement of Profitability
Particulars IstYr 2nd Yr 3rd Yr 4th Yr 5th Yr
Current Tax 7.57 10.63 13.38 16.38 18.99
Deffered Tax - - - - -
Profit after Tax 14.70 20.65 25.98 31.82 36.87
Add: Profit B/f from Previous Year - 14.70 35.35 61.33 93.15
Balances transfer to Reserve & Surplus 14.70 35.35 61.33 93.15 130.02
Financial Ratios
Gross Profit Ratio 37.12 37.83 39.42 40.13 40.78
Net Profit Ratio 13.15 16.22 18.96 20.99 22.59
Current Ratio
4.44
6.23
8.16
10.40
12.85
DSCR
2.67
2.96
3.21
3.51
3.76
BEP
0.72
0.73
0.61
0.51
0.43
IRR 15%
Debt Service coverage Ratio
SI No. Particular Total IstYr 2nd Yr 3rd Yr 4th Yr 5th Yr
1 Profit after Taxation 130.02 14.70 20.65 25.98 31.82 36.87
2 Interest on Term Loan 26.76 7.49 6.42 5.35 4.28 3.21
3 Deffered tax Liability - - - - - -
4 Depreciation 42.12 10.79 9.45 8.27 7.25 6.36
5 Preliminary Expenses w/o - - - - - -
Total 198.90 32.99 36.52 39.60 43.35 46.44
1 Repayment of Term Loan 59.46 11.89 11.89 11.89 11.89 11.89
2 Interest on Term Loan 2.25 0.45 0.45 0.45 0.45 0.45
Total 61.71 12.34 12.34 12.34 12.34 12.34
DSCR (Gross) 3.22 2.67 2.96 3.21 3.51 3.76
Break Even Point
SI NO Particulars IstYr 2nd Yr 3rd Yr 4th Yr 5th Yr
UNITS 52 58.5 62 67.5 72
A Net Sales 99.84
112.32
119.04
129.60
138.24
Add: Closing Stock of F.G 3.84
3.84
5.76
5.76
5.76
Less: Opening Stock of F.G - 3.84
3.84
5.76
5.76
Total 103.68
112.32
120.96
129.60
138.24
B Variable Cost
Raw Materials Consumed 56.25
60.94
65.63
70.31
75.00
Consumables Packing Materials 0.00
0.00
0.01
0.01
0.01
Wages & Salary 7.62
15.24
16.00
16.80
17.64
Power & Fuel 2.27
2.51
2.76
3.02
3.28
Other Manufacturing Expences 0.25
0.30
0.36
0.43
0.52
Repair & Maintenance 0.15
0.17
0.18
0.20
0.22
Other Selling & Administrative Exps 0.10
0.11
0.12
0.13
0.14
Interest on working Capital 0.45
0.45
0.45
0.45
0.45
Total 67.10
79.72
85.50
91.35
97.26
C Contribution 36.58
32.60
35.46
38.25
40.98
P/V Ratio 35.28
29.02
29.31
29.51
29.64
D Fixed & Semi-VarableExps.
Salaries 7.62
7.62
7.62
7.62
7.62
Other Selling &Adm.Exps. (50%) 0.25 0.28 0.30 0.32 0.35
Break Even Point
SI NO Particulars IstYr 2nd Yr 3rd Yr 4th Yr 5th Yr
Interest on Term Loan & Other 7.49
6.42
5.35
4.28
3.21
Depreciation 10.79
9.45
8.27
7.25
6.36
26.16
23.77
21.54
19.47
17.54
Sale price per MT 1.92
1.92
1.92
1.92
1.92
Variable Cost per MT 1.29
1.36
1.38
1.35
1.35
BREAK EVEN SALES 40.94
55.95
63.96
71.87
79.72
10. Project impact
As discussed earlier, the project will have various positive impacts such as:
Infrastructure for value addition: This unit would aim to integrate and streamline existing value
chains in the region by creating centralized infrastructure for value addition and preservation. The
unit will thus provide benefits on cost, quality and convenience for sustainable growth in the
market driven economy. The unit has been envisaged in a way that it would ensure better returns
to all players in each level of value chains ranging from procurement, storage, processing,
packaging to distribution of food commodities through vertical integration of functions and
horizontal linkages of destinations.
Reduction of Wastages: The infrastructure created at the unit along with the integration of
backward and forward linkages would lead to more efficient supply chains and reduction of
wastages. This would provide higher value realization to all players in the supply chain including
the farmers.
Creation of employment: The project shall generate employments. It is estimated that the it
would generate direct employment of about ……………. workers and indirect employment of
another ………….. workers. Most of the manpower requirement will be met from the local area.
Return to farmers: The unit will be benefiting farmers in the region by increasing the returns for
farmers by decreasing wastages and increasing demand of the agricultural produce
11. Recommendation
M/s XYZ FOOD PROCESSING PRIVATE LIMITED was incorporated under the Companies Act, 1956 on
dated ……………. bearing registration number ………….The authorised share capital of the company is
……… lakh and the paid up share capital is ………… lakh
The project is estimated to cost ………… lakh which is as per bank appraisal report and quotations
received from suppliers and estimates given by CA and CEs.
The detailed breakup of the cost of the Project is given below:
The cost of the project is proposed to be financed through a mix of equity, grant from Govt. of Bihar and
term loans detailed as follow:
The project is eligible for a grant amount of ……. lakh the rate of 15/25% of the Capital Expenditure under
the BAIPP 2020.
As per the guidelines of the policy the total grant amount is released in two equal installments. The first
installment shall be released on installation of plant & machinery and the last instalment shall be released
on successful attaining commercial production.