project profilevol 1

PROJECT PROFILES – VOL 1

Sl. No. Name of the Product/ Project

1 Eco-tourism

2 Reprocessed Plastic Granules

3 Puf Panel and Prefab Structure

4 Sanitary Napkins

5 Disposable Paper Plates

6 Corrugated Box

7 Commercial Cultivation & Oil Distillation of Sugandhmantri

8 Commercial Cultivation of Stevia

9 Commercial Cultivation of Sarpangandha

10 Commercial Cultivation & Oil Distillation of Patchouli

11 Commercial Cultivation & Oil Distillation of Lemongrass

12 Commercial Cultivation & Oil Distillation of Citronella

13 2 Star Hotel

14 3 Star Hotel

15 Bakery

16 Noodles

17 Packaged Drinking Water

18 Computer Training Institute

19 Cold Storage

20 Dairy Farming

21 Piggery

22 Broiler Farming

23 Vermicompost

24 Bamboo Stick (Agarbatti) Making unit

25 Bamboo Charcoal

1.0 INTRODUCTION Eco-tourism is a concept developed around the idea of travelling to places of natural beauty,

moving around and staying with the places of nature for a couple of days. It has the twin objectives

of conserving environment and improving the welfare of the local people. Countries like Kenya,

Costa Rica, and South Africa have already successfully promoted eco-tourism. Kerala presents a

unique success story of eco-tourism in our country. On this similar line, North East States has

immense scope for eco-tourism, as its natural beauty with diverse flora and fauna is vastly

unexplored. The green forests, blue hills, enchanting rivers are the basis on which an eco-friendly

tourism can be developed. For that a host of matters to be properly addressed, include: (a)

development of a motorable road to the spots of tourist attraction, (b) creation of infra-structural

facilities like good quality accommodation and fooding, (c) river cruising and water sports, bird

watching towers, etc. These facilities are likely to attract eco-tourists.

This project profile on Eco-tourism is for development of a river eco camp based around faciltiies of

river rafting and angling. The unit will be set up with 7 nos of boats and 5 Nos of cottages. Each

cottage will be double bedded, thus having accomodation capacity 10 persons per day.

2.0 MARKET POTENTIAL Adventure sports activities like rock-climbing, trekking, para-sailing, water sports, river rafting and

angling are being promoted by different state governments of the North East Region. In Assam,

there is an annual angling competition, which attracts not only the local enthusiasts but also

participation from Indian and foreign tourists. With rising incomes, adventure and recreational

activities like angling are being taken up by more and more people in the North East. As such, the

target customer for the present project is not dependent on the tourists alone.

3.0 COST OF THE PROJECT

The estimated project cost is given below. (Rs. in lacs)

Particulars Amount (Rs)

Land & Site Development 6.60

Building & Civil Works 27.01

Equipments 3.06

Misc. Fixed Assets 6.03

Preliminary & Pre-operative Expenses 1.36

Contingencies & Escalation @ 3% 1.28

Working Capital Margin 1.81

TOTAL 47.17

3.1 Land & Site Development: No cost has been cosidered for land. Expenses on site development are estimated as below.

Particulars Area (rm) Rate (Rs) Amount (Rs)

Motorable approach road 1000 400 400000

Gravel pathway 800 200 160000

Site levelling, etc LS LS 100000

TOTAL 660000

Say (Rs. in lacs) 6.60

3.2 Building & Civil Works: Details of building & civil works are given below.

Particulars Area (Sqm) Rate (Rs) Amount (Rs)

5 Nos. of Cottages (Brick wall, CGI sheet roof, Concrete Floor)

210 6000 1260000

Restaurant (Brick wall, CGI sheet roof, Concrete Floor)

72 6000 432000

Staff Quarters & Store Room (Brick wall, CGI sheet roof, Concrete Floor)

120 6000 720000

Sub total 2412000

Add: Electrification, water supply and sanitation @ 12% 289440

TOTAL 2701440


3.3 Equipments: Details of equipments are given below.

Particulars Qty Rate (Rs) Amount (Rs)

Boats (Dare Devils-6 Persons) 2 60000 120000

Boats (River Queen-4 Persons) 4 35000 140000

Life Jacket 15 800 12000

Miscellaneous items LS LS 10000

Sub total 282000

Add: Installation, transporation, etc @ 5% 14100

TOTAL 306100


3.4 Misc. Fixed Assets: Details of miscellaneous fixed assets are given below.


25 KVA DG Set 1 347000 347000

3 HP pump set (water supply system) 1 100000 100000

Ceiling Fans 11 1000 11486

Water Purifiers 5 7500 37500

Cots 31 1500 46500

Tables & Chairs 41 1000 41000


Sub total 593486


TOTAL 603486


3.5 Preliminary & Pre-operative expenses: Details of preliminary & pre-operative expenses are

given below.

(Rs. In lacs)


Travelling expenses 0.20

Professional & other fees 0.20

Interest during implementation 0.86

Miscellaneous expenses 0.10

TOTAL 1.36

3.6 Contingencies & Escalation: Contingencies & escalation has been assumed at 3% of the

cost of land & site develepment, building & civil works, equipments and miscellaneous fixed

assets.

3.7 Working Capital: Details of working capital are given below.

(Rs. in lacs)

Particulars Period (Days)

Amount

Year 1 Year 2 Year 3

Food & Provisions 30 0.25 0.32 0.39

Power & Fuel 30 0.23 0.30 0.37

Salary 30 1.33 1.33 1.34

Total 1.81 1.95 2.09

Working Capital Margin in Year 1 (100%) 1.81

4.0 MEANS OF FINANCE

The means of finance for the project is estimated as below. (Rs. in lacs)

Particulars Percent Amount

EQUITY

A. Equity from Promoters 40% 18.87

B. Subsidy from Central/ State Govt. -

DEBT

Term Loan from Banks/ FIs 60% 28.30

TOTAL 100% 47.17

5.0 PROFITABILITY STATEMENT

(Rs. in lacs)

Particulars Yr 1 Yr 2 Yr 3 Yr 4 Yr 5 Yr 6 Yr 7

A. INCOME

Income at installed capacity (Rs lakhs) 72.74 72.74 72.74 72.74 72.74 72.74 72.74

Capacity utilisation 35% 45% 55% 55% 55% 55% 55%

Income from sales/ annum 25.46 32.73 40.01 40.01 40.01 40.01 40.01

B. OPERATING EXPENSES

Food & Provisions 3.02 3.89 4.75 4.75 4.75 4.75 4.75

Power & Fuel 2.83 3.64 4.45 4.45 4.45 4.45 4.45

Salary 16.20 16.23 16.26 16.30 16.33 16.36 16.40

Repair & Maintenance 0.42 0.46 0.51 0.56 0.62 0.68 0.75

Selling Expenses 0.25 0.33 0.40 0.40 0.40 0.40 0.40

Miscellaneous Expenses 0.13 0.16 0.20 0.20 0.20 0.20 0.20

Total Operating Expenses 22.86 24.72 26.58 26.66 26.75 26.84 26.94

Less: working expenses capitalised 1.81 0.00 0.00 0.00 0.00 0.00 0.00

Operating profit 4.41 8.02 13.43 13.35 13.26 13.16 13.06

C. FINANCIAL EXPENSES

Depreciation 1.45 1.45 1.45 1.45 1.45 1.45 1.45

Interest on Term Loan 2.26 2.09 1.71 1.34 0.96 0.58 0.20

Net Profit 0.70 4.48 10.27 10.57 10.85 11.14 11.41

Net cash accruels 2.15 5.93 11.72 12.01 12.30 12.58 12.86

Principal Repayment 0.00 4.72 4.72 4.72 4.72 4.72 4.72

5.1 Income from sales: Income from sales at installed capacity is estimated as below.

Income from Accomodation

No. of cottages 5

No. of beds/ cottage 2

No. of days/ annum 360

Total rooms/ annum 3600

Rate (Rs/ day) 1200

Income from rooms at installed capacity (Rs) 4320000

Income from Boats

No. of small boats 4

No. of large boats 2

Rate per Trip (full day) for Small Boat 550

Rate per Trip full day) for Large Boat 1100


Income from boats at installed capacity (Rs) 794200

Income from Restaurant

No. of guests/ annum at installed capacity 3600

Cost of fooding/ day 500

Other items like tea, snacks, etc per day 100

Income from restaurant at installed capacity (Rs) 2160000

Total income at installed capacity (Rs) 7274200

5.2 Food & Provisions: Expenses on food & provisions has been assumed @ 40% of income

from restaurant.

5.3 Power & Fuel: Expenses on power & fuel at installed capacity is estimated as below.

A. Expenses on power

Particulars Quantity Power (Kw) Total (Kw) hrs/ day kwh/ day

3 HP water pump 1 2.24 2.24 3 6.71

Ceiling Fans 11 0.50 5.74 10 57.43

General Lighting 20 0.10 2.01 8 16.08

Miscellsneous 1.00 8 8.00

Total power requirement/ day (Kw) 88.22

Average load 70%

Proportion running on power 80%

Days/ annum 360

Rate per unit (Rs) 5.00

Expenses on power per annum (Rs) 88928

B: Estimate of Diesel required for Generator

Hrs/ day 2

Diesel consumption (litres/ hr) 20

Days/ annum 360

Diesel Price per liter 50

Expenses on diesel (Rs) 720000

Expenses on power & fuel per annum at installed capacity (Rs) 808928

5.4 Salary: Expenses on salary salary in the 1st year is estimated as given below. It is assumed

that salary expenses will increase @ 0.2% every subsequent year.

Particulars of Employee Numbers Salary/ Month (Rs) Cost/ annum (Rs)

Manager 1 15000 180000

Technicians/ skilled workers 10 8000 960000

Waiters/ attendants 5 5000 300000

Unskilled workers/ helpers 5 3000 180000

Expenses on salary in the 1st year (Rs) 1620000

5.5 Repair & Maintenance: Expenses on repair & maintenance in the 1st year is estimated as

given below. It is assumed that expenses on repair & maintenance will increase @ 10%

every subsequent year.

(Rs. in lacs)

Particulars Cost (Rs) Rate Amount (Rs)

Building & Civil Works 27.01 1% 0.27

Equipments 3.06 2% 0.06

Misc. Fixed Assets 6.03 2% 0.09

Expenses on repair & maintenance in year 1 0.42

5.6 Selling Expenses: Selling expenses have been assumed at 1% of sales.

5.7 Miscellaneous Expenses: Miscellaneous expenses have been assumed at 0.5% of sales.

5.8 Depreciation: Depreciation has been calculated by straight line method. The details of

calculation are given below.

(Rs in lacs)

Description Cost (Rs) Rate Amount/

annum (Rs)

Building & Civil Works 27.01 3.34% 0.90

Equipments 3.06 5.28% 0.16

Misc. Fixed Assets 6.03 6.33% 0.38

TOTAL 1.45

5.9 Interest on Term Loan & Principal Repayment: Interest rate has been assumed at 8%.

Duration of Loan repayment has been considered for a period of 7 years including

moratarium period of 1 year with equal monthly installments. The details of calculation are

given below.

(Rs in lakh)

Year 1 2 3 4 5 6 7

Month 1 Opening balance 28.30 28.30 23.58 18.87 14.15 9.43 4.72

Repayment 0.00 0.39 0.39 0.39 0.39 0.39 0.39

Interest (8%) 0.19 0.19 0.16 0.13 0.09 0.06 0.03

Closing balance 28.30 27.91 23.19 18.47 13.76 9.04 4.32


Repayment 0.00 0.39 0.39 0.39 0.39 0.39 0.39

Interest 0.19 0.19 0.15 0.12 0.09 0.06 0.03

Closing balance 28.30 27.51 22.80 18.08 13.36 8.65 3.93


Repayment 0.00 0.39 0.39 0.39 0.39 0.39 0.39

Interest 0.19 0.18 0.15 0.12 0.09 0.06 0.03

Closing balance 28.30 27.12 22.40 17.69 12.97 8.25 3.54


Repayment 0.00 0.39 0.39 0.39 0.39 0.39 0.39

Interest 0.19 0.18 0.15 0.12 0.09 0.06 0.02

Closing balance 28.30 26.73 22.01 17.30 12.58 7.86 3.14


Repayment 0.00 0.39 0.39 0.39 0.39 0.39 0.39

Interest 0.19 0.18 0.15 0.12 0.08 0.05 0.02

Closing balance 28.30 26.34 21.62 16.90 12.19 7.47 2.75


Repayment 0.00 0.39 0.39 0.39 0.39 0.39 0.39

Interest 0.19 0.18 0.14 0.11 0.08 0.05 0.02

Closing balance 28.30 25.94 21.23 16.51 11.79 7.08 2.36


Repayment 0.00 0.39 0.39 0.39 0.39 0.39 0.39

Interest 0.19 0.17 0.14 0.11 0.08 0.05 0.02

Closing balance 28.30 25.55 20.83 16.12 11.40 6.68 1.97


Repayment 0.00 0.39 0.39 0.39 0.39 0.39 0.39

Interest 0.19 0.17 0.14 0.11 0.08 0.04 0.01

Closing balance 28.30 25.16 20.44 15.72 11.01 6.29 1.57


Repayment 0.00 0.39 0.39 0.39 0.39 0.39 0.39

Interest 0.19 0.17 0.14 0.10 0.07 0.04 0.01

Closing balance 28.30 24.76 20.05 15.33 10.61 5.90 1.18


Repayment 0.00 0.39 0.39 0.39 0.39 0.39 0.39

Interest 0.19 0.17 0.13 0.10 0.07 0.04 0.01

Closing balance 28.30 24.37 19.65 14.94 10.22 5.50 0.79


Repayment 0.00 0.39 0.39 0.39 0.39 0.39 0.39

Interest 0.19 0.16 0.13 0.10 0.07 0.04 0.01

Closing balance 28.30 23.98 19.26 14.54 9.83 5.11 0.39


Repayment 0.00 0.39 0.39 0.39 0.39 0.39 0.39

Interest 0.19 0.16 0.13 0.10 0.07 0.03 0.00

Closing balance 28.30 23.58 18.87 14.15 9.43 4.72 0.00


Interest 2.26 2.09 1.71 1.34 0.96 0.58 0.20

6.0 DEBT SERVICE COVERAGE RATIO (DSCR)

(Rs. in lacs)

Year 1 2 3 4 5 6 7 TOTAL

Profit After Tax (Net Profit) 0.70 4.48 10.27 10.57 10.85 11.14 11.41

Depreciation 1.45 1.45 1.45 1.45 1.45 1.45 1.45

Interest 2.26 2.09 1.71 1.34 0.96 0.58 0.20

Total 4.41 8.02 13.43 13.35 13.26 13.16 13.06 78.70

Interest 2.26 2.09 1.71 1.34 0.96 0.58 0.20

Loan repayment 0.00 4.72 4.72 4.72 4.72 4.72 4.72

Total 2.26 6.81 6.43 6.05 5.68 5.30 4.92 37.45

DSCR 1.95 1.18 2.09 2.21 2.34 2.48 2.65

Average DSCR = 2.10

7.0 BREAK EVEN POINT (BEP)

(Rs. in lacs)

Year 1 2 3

A. Net sales (Rs. lakh) 25.46 32.73 40.01

B. Variable cost

Food & Provisions 3.02 3.89 4.75

Power & Fuel 2.83 3.64 4.45

Miscellaneous Expenses 0.13 0.16 0.20

Total variable cost 5.98 7.69 9.40

C. Contribution (A-B) 19.48 25.04 30.61

D. Fixed & Semi-fixed Costs

Salary 16.20 16.23 16.26

Repair & maintenance 0.42 0.46 0.51

Interest on Term Loan 2.26 2.09 1.71

Depreciation 1.45 1.45 1.45

Total fixed cost 20.33 20.23 19.93

E. BREAKEVEN POINT 104.39% 80.80% 65.13%

F. BEP at operating capacity 36.54% 36.36% 35.82%

G. Cash BEP 33.94% 33.76% 33.22%

8.0 INTERNAL RATE OF RETURN (IRR)

(Rs. in lacs)

Year 0 1 2 3 4 5 6 7

CASH OUTFLOW

Capital Expenditure 42.71 0.00 0.00 0.00 0.00 0.00 0.00 0.00

Working Capital 0.00 1.81 0.14 0.14 0.00 0.00 0.00 0.00

Total (A) 42.71 1.81 0.14 0.14 0.00 0.00 0.00 0.00

CASH INFLOW

Profit After Tax 0.70 4.48 10.27 10.57 10.85 11.14 11.41

Add: Depreciation 1.45 1.45 1.45 1.45 1.45 1.45 1.45

Add: Interest 2.26 2.09 1.71 1.34 0.96 0.58 0.20

Add: Salvage Value (10%) 4.27

Total (B) 0.00 4.41 8.02 13.43 13.35 13.26 13.16 17.34

NET FLOW (B-A) -42.71 2.60 7.88 13.29 13.35 13.26 13.16 17.34

IRR = 15%

1. INTRODUCTION Over the years, India has made significant progress in the industrial world with healthy economic

growth. On purchase power parity basis, it is one of the top five global economics and is expected

to be the third largest by the turn of this decade. Plastics, one of the fastest growing industries in

India, have a vital role to play. Indian Plastics Industry is expanding at a phenomenal pace. Major

international companies from various sectors such as automobiles, electronics,

telecommunications, food processing, packing, healthcare etc. have set-up large manufacturing

bases in India. Therefore, demand for plastics is rapidly increasing and soon India will emerge as

one of the fastest growing markets in the world. The rising demand for plastic products around the

world is giving a boost to the plastic industry.

The next two decades are expected to offer unprecedented opportunities for the plastic industry in

India. This would necessitate industry initiatives to foster investments, grow the market, upgrade

quality standards, enhance global participation, encourage Indian industry, to adopt and adapt to

world class technology and manufacturing practices.

The Indian plastic processing industry is highly fragmented and comprises 25,000 firms. Barring

10% - 15% of the firms, which can be classified as medium scale operations, all the units operate

on a small-scale basis.

This project profile is for setting up of a Reprocessed Plastic Granules manufacturing unit with

installed capacity of 324 MT per annum.

2. MARKET POTENTIAL In India, the top 100 players account for just 20% of the industry turnover. The total number of

players in the sector is more than 25,000. Despite the small size of operations of the players, they

are able to operate profitably. Further, the high growth in demand ensures that the market is able

to absorb the excess capacity in quick time. Thus, there is scope for setting up more of small scale

plastic processing units.

3. MANUFACTURING PROCESS The manufacturing process for Reprocessed Plactic Granues is described below. (a) Waste plastic scraps are collected and sorted as per colour and then washed in washing

machine. (b) Washed scrap is dried under hydro dryer machine. (c) These dry scrap materials are put in the grinder machine, so that the scraps are cut down to

small pieces. (d) The small pieces of plastic waste are put in the mixer machine so that the moisture is

removed totally. (e) After removing moisture, these plastics are put in the extruder machine, goes through various

processes inside it and results in the output as reprocessed plastic granules (dana).

4. COST OF THE PROJECT





Plant & Machinery 17.48





TOTAL 69.88

4.1 Land & Site Development: No cost has been considered for purchase of land. Details of expenses on site development are given below.


Earth filling, boundary fencing, etc. LS LS 300000




Factory building (Open shed with CGI sheet roof, concrete floor)

450 3500 1575000

Store, office, labor quarters, etc (Brick wall, CGI sheet roof, concrete floor)

80 6000 480000

Sub total 2055000

Add: Electrification, sanitation, etc @ 10% 205500

TOTAL 2260500


4.3 Plant & Machinery: Details of plant & machinery are given below.


Extruder 1 800000 800000

Scrap grinder 1 175000 175000

High speed mixer machine 1 150000 150000

Hydro dryer machine 1 95000 95000

Washing machine 1 200000 200000


Sub total 1520000

Add: Installation, transporation, taxes, etc @ 15% 228000

TOTAL 1748000


4.4 Misc. Fixed assets: Details of miscellaneous fixed assets are given below.


Installation of Transformer (100 kva) 1 200000 200000

100 kva DG set 1 800000 800000

Weighing scale 1 20000 20000

Furniture & fixtures LS LS 100000


Sub total 1220000


TOTAL 1342000


4.5 Preliminary & pre-operative expenses: Details of preliminary & pre-operative expenses are

given below.

(Rs. In lacs)






TOTAL 5.98

4.6 Contingencies & escalation: Contingencies & escalation has been assumed at 3% of the

cost of land & site development, building & civil works, plant & machinery and miscellaneous

fixed assets.

4.7 Working capital: Details of working capital are given below.

(Rs. in lacs)

Period (Days)

Total Current Assets


Raw Materials 30 3.76 4.39 5.02

Power & fuel 30 0.45 0.52 0.60

Salary 30 1.27 1.28 1.29

Finished Goods 30 5.63 6.36 7.09

Receivables 15 3.36 3.82 4.37

Total 14.47 16.38 18.36


5. MEANS OF FINANCE The means of finance for the project is estimated as below. (Rs. in lacs)


EQUITY



DEBT


TOTAL 100% 69.88

6. PROFITABILITY STATEMENT

(Rs. in lacs)


A. INCOME

Production capacity (MT) 324.00 324.00 324.00 324.00 324.00 324.00 324.00


Production at CU (MT) 194.40 226.80 259.20 259.20 259.20 259.20 259.20

Sale price (Rs/ MT) 42000 41000 41000 41000 41000 41000 41000



Raw Materials 45.80 53.44 61.07 61.07 61.07 61.07 61.07

Power & Fuel 5.47 6.38 7.30 7.30 7.30 7.30 7.30

Salary 15.48 15.56 15.64 15.71 15.79 15.87 15.95





Less working expenses capitalised 5.79 0.00 0.00 0.00 0.00 0.00 0.00



Depreciation 2.53 2.53 2.53 2.53 2.53 2.53 2.53


Interest on Working Capital Loan 1.39 1.57 1.76 1.76 1.76 1.76 1.76

Net Profit 9.34 6.30 11.45 12.25 13.05 13.83 14.61



6.1 Estimation of Production: Production of plastic granules at installed capacity is estimated

as below.

Output of plastic granules per hr (kg) 135

Hrs/ day 8

Days/ annum 300

Production of plastic grabules per annum at installed capacity (Kg) 324000

6.2 Raw Materials: Expenses on raw materials at installed capacity is estimated as below.

Plastic scrap (kg) 324000

Calcium carbonate @ 2% of scrap 6480

Raw material utilised (kg) 330480

Average price of raw materials (Rs/ kg) 22

Expenses on raw materials (Rs) 7270560

Add: Expenses on consumables, packing materials, etc @ 5% 363528

Expenses on raw materials & consumables at installed capacity (Rs) 7634088



Connected load 100

Avg load factor 70%


Hrs/ day 8

Days/ annum 300

Annual power consumption 134400

Rate (Rs/ unit) 5

Expenses on power per annum at 100% capacity (Rs) 672000

B: Estimate of Diesel

Proportion running on fuel (diesel) 20%

Hrs/ annum 480


Diesel Price per litre 50

Expenses on diesel per annum at 100% capacity (Rs) 240000

Expenses on power & fuel at 100% capacity (Rs) 912000

6.4 Salary: Expenses on salary in the 1st year is estimated as given below. It is assumed that

salary expenses will increase @ 0.5% every subsequent year.


Manager 1 25000 300000

Supervisor 1 12000 144000

Accounts Officer 1 12000 144000

Technicians/ machine operators 5 8000 480000

Sales staff 2 5000 120000






(Rs. in lacs)



Plant & Machinery 17.48 1% 0.17







(Rs in lacs)

Description Cost (Rs) Rate Amount/ annum (Rs)


Plant & Machinery 17.48 5.28% 0.92


TOTAL 2.53

6.9 Interest on Term Loan & Principal Repayment: Interest rate has been assumed at 13.5%.



given below.

(Rs in lakh)

Month Year 1 2 3 4 5 6 7


Repayment 0.00 0.58 0.58 0.58 0.58 0.58 0.58

Interest (13.5%) 0.47 0.47 0.39 0.31 0.24 0.16 0.08

Closing balance 41.93 41.35 34.36 27.37 20.38 13.39 6.41


Repayment 0.00 0.58 0.58 0.58 0.58 0.58 0.58

Interest 0.47 0.47 0.39 0.31 0.23 0.15 0.07

Closing balance 41.93 40.76 33.78 26.79 19.80 12.81 5.82


Repayment 0.00 0.58 0.58 0.58 0.58 0.58 0.58

Interest 0.47 0.46 0.38 0.30 0.22 0.14 0.07

Closing balance 41.93 40.18 33.19 26.21 19.22 12.23 5.24


Repayment 0.00 0.58 0.58 0.58 0.58 0.58 0.58

Interest 0.47 0.45 0.37 0.29 0.22 0.14 0.06

Closing balance 41.93 39.60 32.61 25.62 18.64 11.65 4.66


Repayment 0.00 0.58 0.58 0.58 0.58 0.58 0.58

Interest 0.47 0.45 0.37 0.29 0.21 0.13 0.05

Closing balance 41.93 39.02 32.03 25.04 18.05 11.06 4.08


Repayment 0.00 0.58 0.58 0.58 0.58 0.58 0.58

Interest 0.47 0.44 0.36 0.28 0.20 0.12 0.05

Closing balance 41.93 38.44 31.45 24.46 17.47 10.48 3.49


Repayment 0.00 0.58 0.58 0.58 0.58 0.58 0.58

Interest 0.47 0.43 0.35 0.28 0.20 0.12 0.04

Closing balance 41.93 37.85 30.86 23.88 16.89 9.90 2.91


Repayment 0.00 0.58 0.58 0.58 0.58 0.58 0.58

Interest 0.47 0.43 0.35 0.27 0.19 0.11 0.03

Closing balance 41.93 37.27 30.28 23.29 16.31 9.32 2.33


Repayment 0.00 0.58 0.58 0.58 0.58 0.58 0.58

Interest 0.47 0.42 0.34 0.26 0.18 0.10 0.03

Closing balance 41.93 36.69 29.70 22.71 15.72 8.74 1.75


Repayment 0.00 0.58 0.58 0.58 0.58 0.58 0.58

Interest 0.47 0.41 0.33 0.26 0.18 0.10 0.02

Closing balance 41.93 36.11 29.12 22.13 15.14 8.15 1.16


Repayment 0.00 0.58 0.58 0.58 0.58 0.58 0.58

Interest 0.47 0.41 0.33 0.25 0.17 0.09 0.01

Closing balance 41.93 35.52 28.54 21.55 14.56 7.57 0.58


Repayment 0.00 0.58 0.58 0.58 0.58 0.58 0.58

Interest 0.47 0.40 0.32 0.24 0.16 0.09 0.01

Closing balance 41.93 34.94 27.95 20.96 13.98 6.99 0.00


Interest 5.66 5.23 4.28 3.34 2.40 1.45 0.51

6.10 Interest on Working Capital Loan: Interest rate on working capital loan has been assumed

at 16%. Details of calculation are given below.

(Rs. in lacs)

Particulars Year 1 Year 2 Year 3

Total current assets 14.47 16.38 18.36

Bank Loan (60%) 8.68 9.83 11.02

Interest @ 16% 1.39 1.57 1.76

7. DEBT SERVICE COVERAGE RATIO (DSCR)

(Rs. in lacs)

Year 1 2 3 4 5 6 7 TOTAL


Depreciation 2.53 2.53 2.53 2.53 2.53 2.53 2.53

Interest 5.66 5.23 4.28 3.34 2.40 1.45 0.51

Total 17.53 14.05 18.26 18.12 17.97 17.81 17.65 121.40

Interest 5.66 5.23 4.28 3.34 2.40 1.45 0.51

Loan repayment 0.00 6.99 6.99 6.99 6.99 6.99 6.99

Total 5.66 12.22 11.27 10.33 9.39 8.44 7.50 64.81

DSCR 3.10 1.15 1.62 1.75 1.91 2.11 2.35

Average DSCR = 1.87

8. BREAK EVEN POINT (BEP)

(Rs. in lacs)

Year 1 2 3


B. Variable cost

Raw Materials 45.80 53.44 61.07

Power & Fuel 5.47 6.38 7.30

Selling Expenses 0.82 0.93 1.06


Interest on Working Capital Loan 1.39 1.57 1.76




Salary 15.48 15.56 15.64







G. Cash BEP 46.85% 49.54% 47.63%

9. INTERNAL RATE OF RETURN (IRR)

(Rs. in lacs)

Year 0 1 2 3 4 5 6 7

CASH OUTFLOW


Working Capital 0.00 14.47 1.90 1.98 0.00 0.00 0.00 0.00

Total (A) 56.51 14.47 1.90 1.98 0.00 0.00 0.00 0.00

CASH INFLOW

Profit After Tax 9.34 6.30 11.45 12.25 13.05 13.83 14.61


Add: Interest 5.66 5.23 4.28 3.34 2.40 1.45 0.51

Add: Salvage Value

Total (B) 0.00 17.53 14.05 18.26 18.12 17.97 17.81 17.65

NET FLOW (B-A) -56.51 3.06 12.15 16.28 18.12 17.97 17.81 17.65

IRR = 15%

1.0 INTRODUCTION Polyurethane Foam (PUF) is a closed cell plastic capable of being molded into boards and blocks

that can be used as a construction material, which is both low on maintenance and durable. PUF

leads to energy saving and reduced heating/cooling loads. These are normally available in PPGI

sandwiched options of varying length. PUF applications can found in cold rooms, refrigerated

vehicles, Green buildings, warehousing and storage applications and low cost housing.

As per the requirement Sandwiched PUF panels of different thickness and length can be

manufactured with consistence chemical and physical properties as per relevant national and

international standards. These PUF Panels are used in insulated buildings as Wall, Floor, and

Roof Panels. The pre-engineered PUF Panels helps to reduce on site waste and ensure the quality

of installation, greatly reducing the risk of air leakages, cold bridging and inconsistent insulation.

PUF is base component for any of the applications, be it cold storage, doors, mobile vans or

residential / office use. Though there are number of insulation solutions PUF is preferred over

others because of it has better insulation characteristics. When PUF is sandwiched between two

powder coated GI sheets, it gives mechanical strength also. That is why PUF panels are very good

proposition for walls as well as roofs. There is extensive use of PUF panels in medical industry be

it operation theaters or pharmaceutical plants.

Pre-Engineered Building (PEB) based PUF insulated structures are widely used in defence,

housing, warehousing etc. There is scope to customize all specific requirements with the proper

technology The Puf Panels are generally used in the following:

PUF Insulated Shelters / Barracks

High Altitude Habitat

Ultra Light Weight Structures

Ground+1 PEB Structures with PUF Insulation

Bullet Proof Shelters and Permanent Defense (PD)

Aircraft Hangers

Industrial Buildings and sheds - Low Cost Row Housing / Re-habilitation Colony.

Prefab technology involves use of factory-manufactured components in buildings. In large

construction projects, various modules of the structure are cast off-site in factories and then

assembled on the site. In the process, prefab materials such as wall and terrace blocks, wall

panels, steel frames and plaster boards are used along with innovations such as the dry-wall

technique. Pre-engineered building is very easy and quick to build. They can be easily constructed

even in the area with space constraints as assembling of various building components do not

require much space. As pre-engineered metal building is made up of metal, it is corrosion resistant,

has good solidity and longer durability and compared to standard buildings. They are planned,

designed and almost pre-built at the factory itself. The building components just have to be

assembled once they are transported to the desired location. They are pre-drilled, pre-cut and pre-

welded and just need to be bolted together. This can often be done quickly and with a minimum of

professional assistance. Pre engineered steel buildings provide the planner to have innovative

designs and have them successfully implemented as they can be constructed at places which have

space constraints because they use assembling process for construction.

Pre-fabricated metal buildings have become a popular alternative to conventional buildings. This

type of construction can be used for small storage buildings in a backyard to large industrial

buildings. It also takes much less time to build these structures, compared to traditional buildings.

With fewer components, the time it takes to complete a pre-engineered building is cut in half,

compared to the time it takes to build a traditional structure. They require less maintenance than

traditional buildings such as wood structures.

http://www.acme.in/defence/puf-insulated-shelters.html

http://www.acme.in/defence/high-altitude-habitat.html

http://www.acme.in/defence/ultra-light-weight-structures.html

http://www.acme.in/defence/ground-peb-structures.html

http://www.acme.in/defence/bullet-proof-shelters.html

http://www.acme.in/defence/aircraft-hangers.html

http://www.acme.in/defence/low-cost-row-housing.html

http://www.coldsteels.com/

http://www.coldsteels.com/

Some of the uses of Prefab structures are as given:

Prefabricated Buildings

Porta Cabins

Security Guard Cabins

Portable Toilets

Labour Camps

Cold Storages

Portable Departmental Stores

Pre Engineering Buildings

Warehouse

Factory

This project profile is for setting up of a Puf Panel and Prefab Structure manufacturing unit with

installed capacity of 7500 sq mtr and 1500 MT per annum respectively.

2.0 MARKET POTENTIAL The project is suitable in the North Eastern Region due to the growing construction sector which is

yet to be properly tapped. The boost of governmental spending and increased demand for housing

and construction activity continues unabated in this part of the Country. North East is one of the

few markets where the public sector spending in infrastructure and housing is significant along with

the real estate activity happening in the private sector. Prefab construction in this region till now

had been restricted to constructing small units like project site offices, cold storages, exhibition

halls, portable cabins, kiosks, workshops and warehouses. But now with the country witnessing an

infrastructure boom, even flyover construction and the Metro are applying the prefab construction

techniques for the simple reason that normal construction methods cannot be used due to safety

issues at these sites and work can be finished faster and with ease.

Some of the growth areas in the economy of the region which can lead to demand of prefabricated

structures are as hereunder:

The exhibition industry is in a modernization mode and growing at a rapid pace. New trade

shows are being held, new exhibition centres have been constructed, and the market is opening up

to foreign investors. The exhibition market witnessed significant growth in the last 15 years.

Several new exhibition venues came up during this period in several cities.

Education is one of the largest service sector industries characterized by a unique set of

attributes. The formal education space is regulated and has a dominant share in the overall

education market. Many corporate houses have / are planning to set up their own chain of pre-

schools. Pre schools are viewed as attractive investment opportunities due to the growth potential.

The Indian aviation industry is one of the fastest-growing aviation industries in the world with

private airlines accounting for more than 75 per cent of the sector of the domestic aviation market.

Over the past year investment in airport infrastructure in the region is growing.

The Warehousing sector is growing at a rate of 35-40 per cent every year. The growth potential

for this sector is huge with approximately significant nos of Govt initiated logistics parks are likely to

come up.

The residential segment leads the growth trajectory-nearly 75-80% of the total real estate

space. Rapid urbanization, increase in number of households, rising income levels, and easy

availability of housing finance are among the main reasons cited for this trend.

Prefab structures and puf panels have their own positive aspect which is one of the major factors

that is ensuring a demand for the products. Some of these are:

Reduced construction time: Buildings are typically delivered in just a few weeks after

approval of drawings. Foundation and anchor bolts are cast parallel with finished, ready for the site

bolting.

Lower costs: Due to the systems approach, there is a significant saving in design,

manufacturing and on site erection cost. The secondary members and cladding nest together

reducing transportation cost.

Flexibility of expansion: Buildings can be easily expanded in length by adding additional

bays. Also expansion in width and height is possible by pre designing for future expansion.

Large clear spans: Buildings can be supplied to around 80M clear spans.

Quality control: As buildings are manufactured completely in the factory under controlled

conditions the quality is assured.

Low maintenance: Buildings are supplied with high quality paint systems for cladding and

steel to suit ambient conditions at the site, which results in long durability and low maintenance

coats.

Energy efficient roofing and wall systems: Buildings can be supplied with polyurethane

insulated panels or fiberglass blankets insulation to achieve required “U” values.

Architectural versatility: Building can be supplied with various types of fascias, canopies, and

curved eaves and are designed to receive pre cast concrete wall panels, curtain walls, block walls

and other wall systems.

Single source responsibility: As the complete building package is supplied by a single

vendor, compatibility of all the building components and accessories is assured. This is one of the

major benefits of the pre engineered building systemss like meat, fish, milk, etc.

3.0 MANUFACTURING PROCESS

(i) PUF Panel: Foods Puf Panels are produced by the standard production process as per the set standard conforming to the requirement of the industry. The metal sheet is first profiled as per requirement of roof or wall or as per customer specification. Then the profiled sheet is cut to size in length and breadth with side 10 mm bent. The bed of the press is made ready for the given length and breadth and of desired thickness using spacer. After that the profiled sheets are kept in place in the adjusted area of the press platform that travels inside the press on either side along with the cam lock at cam stations. The platform is rolled in and the press is raised to close. There is small orifice at the length side of press through which polyurethane liquid is injected as per set programme. In both the panel of upper and lower the panel head in press for appx 20 mins and then moved out and removed from the platform so that new set of profiled sheets are put along with cam locks. On removing from the press the panels are put on even surface and allowed to cool and ready for shipment. This process will go on and can be varied in sizes for length, width or the thickness.

(ii) Prefab Structure: The PFB production process primarily consists of FOUR major parallel processing lines, as under:

Built-up members for Primary frame

Cold forming for Secondary framing

Profiling for Roof and Wall sheeting

Accessories & Bracings like Gutters, down take pipes, ridge Vents, Skylights, clips etc.

The production & shipment of these components for a PFB structure uses following processes:

Plate cutting using Shear/Plasma/Multi-torch for optimized use of plate area.

H-beam welding on automatic welding machines using SAW or MIG welding process

Fabrication for fitments like end plates, stiffeners and connections cleats.

Cleaning the surface for painting

Slitting HR coils for cold forming operations to make Z and C sections with punching

Cutting and threading sag rods and bracing rods

Fabrication of Diagonal bracing angles or pipes

Profiling the Galvalume/Zincalume sheets for roofing and wall cladding

Manufacturing Gutters, down take pipes in press bend

Procuring and assigning required matching fasteners for connections

Organizing some bought out accessories

Quality control tests & inspection; and matching with project wise Bill of Quantities as given by the engineering department.

Dispatching to project sites as per sequence of erection.


The estimated project cost is given below: (Rs. in lacs)









TOTAL 436.34

4.1 Land & Site Development: No cost has been considered for land & site development. It is assumed that the [roject will be set up in existingland.



Factory building (Open shed with CGI sheet roof, concrete floor)

400 3500 1400000

Store (Brick wall, CGI sheet roof, concrete floor) 40 6000 240000

Labor querters 30 3500 105000

Weigh bridge platform LS LS 100000

Sub total 1845000

Add: Electrification, sanitation, etc @ 10% 184500

TOTAL 2029500




Double head decoiler 1 1900000 1900000

Cut to length machine 1 3900000 3900000

Ribbing profile machine 1 2500000 2500000

Compressor 1 180000 180000

Air drier 1 70000 70000

Carriage system 1 1230000 1230000

Hydraulic panel 1 4870000 4870000

Polyurethane Foaming machine 1 4830000 4830000

Welding machine 20 65000 1300000

Gas cutting set 3 26000 78000

Drill machine (big) 2 110000 220000

Drill machine (small) 2 92000 184000

Pipe cutting machine 6 14500 87000

Grinding machine (big) 6 17600 105600

Grinding machine (medium) 4 13900 55600

Grinding machine (small) 2 8400 16800

Sheet rolling machine 1 1710000 1710000

aluminium profile cutter 1 275000 275000

Hand drill 2 5600 11200

Magnetic drill 6 57000 342000

Hand held sheet cutting machine 2 6500 13000

Angle cutting machine 1 872500 872500

Thread cuttingmachine 1 645000 645000

Sub total 25395700


TOTAL 29205055




Installation of Transformer 1 1000000 1000000

250 kva DG set 1 889000 889000

Fire fighting equipments LS LS 100000

Workshop equipments LS LS 200000

Laboratory equipments LS LS 100000



Sub total 2389000


TOTAL 2627900


4.5 Preliminary & pre-operative expenses: Details of preliminary & pre-operative expenses

are given below.

(Rs. In lacs)






TOTAL 14.39

4.6 Contingencies & escalation: Contingencies & escalation has been assumed at 3% of the

cost of land & site develepment, building & civil works, plant & machinery and miscellaneous

fixed assets.


(Rs. in lacs)

Period (Days)



Raw Materials 30 66.54 83.17 99.81

Power & fuel 30 0.60 0.75 0.90

Salary 30 3.55 3.57 3.59

Finished Goods/ in process 30 72.17 89.29 106.40

Receivables 15 40.07 50.09 60.10

Total 182.93 226.86 270.80





EQUITY



DEBT


TOTAL 100% 436.34


(Rs. in lacs)


A. INCOME




Raw Materials 809.55 1011.94 1214.33 1214.33 1214.33 1214.33 1214.33

Power & Fuel 7.30 9.12 10.94 10.94 10.94 10.94 10.94

Salary 43.20 43.42 43.63 43.85 44.07 44.29 44.51





Less working expenses capitalised

73.17 0.00 0.00 0.00 0.00 0.00 0.00



Depreciation 17.76 17.76 17.76 17.76 17.76 17.76 17.76


Interest on WC Loan 17.56 21.78 26.00 26.00 26.00 26.00 26.00

Net Profit 99.45 60.26 97.42 102.90 108.38 113.84 119.29



6.1 Income from Sales: Income from sales at installed capacity is estimated as below.

Product Unit Installed Capacity (MT) Sale price (Rs/ unit) Amount (Rs)

Puf panel Sqm 75000 1750 131250000

Prefab structure kg 1500000 75 112500000

Income from sales at installed capacity (Rs) 243750000

6.2 Raw Materials: Expenses on raw materials at installed capacity is estimated as below.

Particulars Unit Qty required/ unit Rate (Rs) Amount (Rs)

Puf panel

Polyol litres 1.09 210 229

ISO litres 1.31 210 275

PPGI sqm 2.00 430 860

Clamp lock sqm 1.67 80 134

Expenses on raw materials per unit Puf panel (Rs) 1498

Add: Scaling loss @ 5% 75

Expenses on raw materials at installed capacity for Puf panel 117936000

Pre fab structures

Pipe kg 0.88 54 48

Flat kg 0.07 50 4

Plate kg 0.05 52 3

Expenses on raw materials per unit Pre fab structures (Rs) 54

Add: Scaling loss @ 5% 3

Expenses on raw materials at installed capacity for Pre fab structures 84451500

Expenses on raw materials at installed capacity (Rs) 202387500



Connected load 250

Avg load factor 70%


Hrs/ day 8

Days/ annum 300


Rate (Rs/ unit) 5




Hrs/ annum 480








Manager 1 50000 600000

Supervisors 3 30000 1080000

Accounts Officer 1 25000 300000






given below. It is assumed that expenses on repair & maintenance will increase @ 5% every

subsequent year.

(Rs. in lacs)










(Rs in lacs)



Plant & Machinery 292.05 5.28% 15.42


TOTAL 17.76




given below.

(Rs in lakh)

Month Year 1 2 3 4 5 6 7


Repayment 0.00 3.64 3.64 3.64 3.64 3.64 3.64

Interest (13.5%) 2.95 2.95 2.45 1.96 1.47 0.98 0.49

Closing balance 261.81 258.17 214.54 170.90 127.27 83.63 40.00


Repayment 0.00 3.64 3.64 3.64 3.64 3.64 3.64

Interest 2.95 2.90 2.41 1.92 1.43 0.94 0.45

Closing balance 261.81 254.53 210.90 167.26 123.63 80.00 36.36


Repayment 0.00 3.64 3.64 3.64 3.64 3.64 3.64

Interest 2.95 2.86 2.37 1.88 1.39 0.90 0.41

Closing balance 261.81 250.90 207.26 163.63 119.99 76.36 32.73


Repayment 0.00 3.64 3.64 3.64 3.64 3.64 3.64

Interest 2.95 2.82 2.33 1.84 1.35 0.86 0.37

Closing balance 261.81 247.26 203.63 159.99 116.36 72.72 29.09


Repayment 0.00 3.64 3.64 3.64 3.64 3.64 3.64

Interest 2.95 2.78 2.29 1.80 1.31 0.82 0.33

Closing balance 261.81 243.62 199.99 156.36 112.72 69.09 25.45


Repayment 0.00 3.64 3.64 3.64 3.64 3.64 3.64

Interest 2.95 2.74 2.25 1.76 1.27 0.78 0.29

Closing balance 261.81 239.99 196.35 152.72 109.09 65.45 21.82


Repayment 0.00 3.64 3.64 3.64 3.64 3.64 3.64

Interest 2.95 2.70 2.21 1.72 1.23 0.74 0.25

Closing balance 261.81 236.35 192.72 149.08 105.45 61.82 18.18


Repayment 0.00 3.64 3.64 3.64 3.64 3.64 3.64

Interest 2.95 2.66 2.17 1.68 1.19 0.70 0.20

Closing balance 261.81 232.72 189.08 145.45 101.81 58.18 14.54


Repayment 0.00 3.64 3.64 3.64 3.64 3.64 3.64

Interest 2.95 2.62 2.13 1.64 1.15 0.65 0.16

Closing balance 261.81 229.08 185.45 141.81 98.18 54.54 10.91


Repayment 0.00 3.64 3.64 3.64 3.64 3.64 3.64

Interest 2.95 2.58 2.09 1.60 1.10 0.61 0.12

Closing balance 261.81 225.44 181.81 138.18 94.54 50.91 7.27


Repayment 0.00 3.64 3.64 3.64 3.64 3.64 3.64

Interest 2.95 2.54 2.05 1.55 1.06 0.57 0.08

Closing balance 261.81 221.81 178.17 134.54 90.90 47.27 3.64


Repayment 0.00 3.64 3.64 3.64 3.64 3.64 3.64

Interest 2.95 2.50 2.00 1.51 1.02 0.53 0.04

Closing balance 261.81 218.17 174.54 130.90 87.27 43.63 0.00


Interest 35.34 32.64 26.75 20.86 14.97 9.08 3.19



(Rs. in lacs)



Bank Loan (60%) 109.76 136.12 162.48

Interest @ 16% 17.56 21.78 26.00


(Rs. in lacs)

Year 1 2 3 4 5 6 7 TOTAL

Net Profit 99.45 60.26 97.42 102.90 108.38 113.84 119.29

Depreciation 17.76 17.76 17.76 17.76 17.76 17.76 17.76

Interest 35.34 32.64 26.75 20.86 14.97 9.08 3.19

Total 152.55 110.66 141.93 141.53 141.11 140.68 140.25 968.71

Interest 35.34 32.64 26.75 20.86 14.97 9.08 3.19

Loan repayment 0.00 43.63 43.63 43.63 43.63 43.63 43.63

Total 35.34 76.28 70.39 64.50 58.61 52.72 46.82 404.65

DSCR 4.32 1.45 2.02 2.19 2.41 2.67 3.00

Average DSCR = 2.39


(Rs. in lacs)

Year 1 2 3


B. Variable cost

Raw Materials 809.55 1011.94 1214.33

Power & Fuel 7.30 9.12 10.94







Salary 43.20 43.42 43.63







G. Cash BEP 26.02% 25.25% 23.49%


(Rs. in lacs)

Year 0 1 2 3 4 5 6 7

CASH OUTFLOW


Working Capital 0.00 182.93 43.94 43.94 0.00 0.00 0.00 0.00

Total (A) 338.62 182.93 43.94 43.94 0.00 0.00 0.00 0.00

CASH INFLOW

Profit After Tax 99.45 60.26 97.42 102.90 108.38 113.84 119.29


Add: Interest 35.34 32.64 26.75 20.86 14.97 9.08 3.19

Add: Salvage Value

Total (B) 0.00 152.55 110.66 141.93 141.53 141.11 140.68 140.25

NET FLOW (B-A) -338.62 -30.37 66.72 97.99 141.53 141.11 140.68 140.25

IRR = 16%

1.0 INTRODUCTION Throughout the centuries, a plethora of cultural and social taboos has been associated with

menstruating girls and women, as well as menstrual health. In many parts of the world, women are

still not allowed to leave the confines of their homes while menstruating. Deemed “impure” and

“unclean,” they are not allowed to venture freely outside their homes. Thus, girls and women are

deprived of opportunities in schools, workplaces, and social settings.

In addition, this lack of control over their lives puts women at loss when it comes to gaining information on cost-effective, affordable menstrual health products. Such women often resort to horrific means such as repeatedly using the same unsterilized cloth during menstruation instead of sanitary napkins. Due to these unhygienic preventative methods, women are prey to a host of illnesses and fatalities. For example, out of every 10,000 women in India, 2000 women die during childbirth due to unhygienic menstrual practices.

Although, there is a well-developed sanitary napkin industry in India, with major players such as Proctor & Gamble and Johnsons & Johnsons, these sanitary napkins are often unaffordable to the millions of Indian women living in low-income and under-privileged communities. This is primarily due to the cost of the sanitary napkins resulting from the use of expensive machinery and huge profit margins by these brand name companies. According to a study report undertaken by AC Nielsen, only 12% of India's 355 million menstruating women use sanitary napkins. The biggest barrier to using a sanitary napkin is affordability. Around 70% of women in India say their family cannot afford to buy them.

This project profile is for setting up of sanitary napkin manufacturing unit with a cost-effective machine that can produce and market biodegradable sanitary napkins locally. This semi-automatic and portable machine can be accommodated in a small space of about 12 sqm. It works on single-phase electricity and has a production capacity of 2 napkins per minute. The machine incorporates pinewood fiber, a raw material, which goes through a 3 step process: (a) defibration, (b) core formation and then (c) sealing with soft touch sensitive heat control. This last step ensures the final shape of the napkins.

The installed capacity of the unit is 11.52 lacs napkins per annum by using 4 machinery sets with

300 working days and 8 working hours.

2.0 MARKET POTENTIAL According to market research agency Nielsen, India's sanitary napkin market is largely untapped

and is growing at a rate of 24% annually, and usage is close to 20% of potential customers.

Most large brands such as 'Whisper' from P&G and 'Stayfree' from J&J have a strong presence in

urban areas, leaving the field open for the entry of new players with low-cost solutions targeting

semi-urban and rural areas.

3.0 MANUFACTURING PROCESS De fibration of wood pulp is done on the defibration machine. The de fibred wood pulp is measured on a weighing scale and the wood pulp is filled on a core block and pressed by core forming machine. After this, pressed cores are wrapped by non – woven fabric and sealed using napkin finishing machine (sealing machine). Then position sticker is pasted on the napkin and then packed.



Particulars Amount

Land and Site Development -


Machinery & Equipments 3.35




Working Capital 1.55

TOTAL 10.19

4.1 Land & Site Development: No cost has been considered for land & site development. It is assumed that the unit will be set up in own land.



Work Shed (Brick wall, CGI sheet roof, concrete floor)

40 6000 267600

Store room (Brick wall, CGI sheet roof, concrete floor)

25 6000 133800

Sub total 401400

Add: Electrification, etc @ 10% 40140

TOTAL 441540


4.3 Machinery & Equipments: Details of machinery & equipments are given below.


Defibering M/c 4 20200 80800

Soft touch sealing Machine 4 28000 112000

Core forming M/c 4 5500 22000

Core dies 20 625 12500

Ultra Violet Treatment Unit 4 10400 41600


Sub total 278900

Add: Transporation, installation, training, taxes, etc @ 20% 55780

TOTAL 334680






TOTAL 30000


4.5 Preliminary & Pre-operative expenses: Details of preliminary & pre-operative expenses are

given below.

(Rs. In lacs)


Traveling expenses 0.20

Proffessional & other fees 0.10



TOTAL 0.33


building & civil works, machinery & equipments and miscellaneous fixed assets.


(Rs. In lacs)

Period (Days)

Amount (Rs)

Yr 1 Yr 2 Yr 3

Raw materials & consumables 30 0.72 0.86 1.00

Power 30 0.01 0.01 0.01

Salary 30 0.24 0.24 0.24


Receivables 7 0.21 0.25 0.29

Total 1.55 1.80 2.04

Working capital margin in Yr 1 (100%) 1.55




EQUITY



DEBT


TOTAL 100% 10.19


(Rs. in lacs)

Particulars Yr 1 Yr 2 Yr 3 Yr 4 Yr 5

A. INCOME

Production capacity (No. of packets/ annum) 144000 144000 144000 144000 144000

Capacity utilisation 50% 60% 70% 70% 70%

Production/ annum at capacity utilisation 72000 86400 100800 100800 100800

Price (Rs/ packet) 15 15 15 15 15

Total income/ annum 10.80 12.96 15.12 15.12 15.12


Raw Materials & Consumables 6.33 7.60 8.86 8.86 8.86

Power 0.07 0.08 0.09 0.09 0.09

Salary 2.88 2.89 2.91 2.92 2.94

Repair & Maintenance 0.08 0.09 0.10 0.11 0.12

Miscellaneous Expenses 0.11 0.13 0.15 0.15 0.15

Total Operating Expenses 9.46 10.79 12.11 12.13 12.16

Less: working expenses capitalised 1.55 0.00 0.00 0.00 0.00

Operating profit 2.89 2.17 3.01 2.99 2.96


Depreciation 0.40 0.40 0.40 0.40 0.40

Interest on Term Loan 0.49 0.41 0.29 0.18 0.06

Net Profit 2.00 1.36 2.31 2.40 2.49

Net cash accruels 2.40 1.77 2.72 2.81 2.90

Principal Repayment 0.36 1.44 1.44 1.44 1.44

6.1 Production capacity: Total production of sanitary napkin packets at installed capacity is

estimated as below.

Rated machine capacity (No. of napkins/ minute) 2

Working hrs/ day 8

No. of machines 4

Days/ annum 300

Total production 1152000

No. of napkins per packet 8

Total packets at installed capacity 144000

6.2 Raw material & Consumables: Expenses on raw material and consumables at installed

capacity is estimated as below.

Particulars Unit Rate/ napkin Quantity required Price (Rs/ unit) Amount (Rs)

Wood Pulp kg 0.010 11600 55.00 638000

Top Layer metre 0.153 176000 2.00 352000

Back Layer grams 0.243 280000 0.20 56000

Release Paper sheets 0.010 12000 2.00 24000

Gum kg 0.001 800 110.00 88000

Packing Covers nos 0.125 144000 0.75 108000


6.3 Power: Expenses on power at installed capacity is estimated as below.

Particulars Quantity Power (Kw) Total (Kw)

General Lighting 7 0.10 0.67

Machinery 16 0.50 8.00




Expenses on power per annum at installed capacity (Rs) 13004




Manager (Self) 0 0 0

Machine operators/ helpers 12 2000 288000





(Rs. in lacs)

Particulars Cost (Rs) Rate Amount


Machinery & Equipments 3.35 1% 0.03


Expenses on repair & maintenance in the 1st year (Rs) 0.08

6.6 Miscellaneous Expenses: Miscellaneous expenses have been assumed at 1% of sales.



(Rs in lacs)



Machinery & Equipments 3.35 7.07% 0.24


TOTAL 0.40

6.8 Interest on term loan & principal repayment: Interest rate has been assumed at 8%.


moratarium period of 9 months with equal monthly installments. The details of calculation are

given below.

(Rs in lakh)

Month Year 1 2 3 4 5

Month 1 Opening balance 6.11 5.75 4.31 2.88 1.44

Repayment 0.00 0.12 0.12 0.12 0.12

Interest (8%) 0.04 0.04 0.03 0.02 0.01

Closing balance 6.11 5.63 4.19 2.76 1.32


Repayment 0.00 0.12 0.12 0.12 0.12

Interest 0.04 0.04 0.03 0.02 0.01

Closing balance 6.11 5.51 4.07 2.64 1.20


Repayment 0.00 0.12 0.12 0.12 0.12

Interest 0.04 0.04 0.03 0.02 0.01

Closing balance 6.11 5.39 3.96 2.52 1.08


Repayment 0.00 0.12 0.12 0.12 0.12

Interest 0.04 0.04 0.03 0.02 0.01

Closing balance 6.11 5.27 3.84 2.40 0.96


Repayment 0.00 0.12 0.12 0.12 0.12

Interest 0.04 0.04 0.03 0.02 0.01

Closing balance 6.11 5.15 3.72 2.28 0.84


Repayment 0.00 0.12 0.12 0.12 0.12

Interest 0.04 0.03 0.02 0.02 0.01

Closing balance 6.11 5.03 3.60 2.16 0.72


Repayment 0.00 0.12 0.12 0.12 0.12

Interest 0.04 0.03 0.02 0.01 0.00

Closing balance 6.11 4.91 3.48 2.04 0.60


Repayment 0.00 0.12 0.12 0.12 0.12

Interest 0.04 0.03 0.02 0.01 0.00

Closing balance 6.11 4.79 3.36 1.92 0.48


Repayment 0.00 0.12 0.12 0.12 0.12

Interest 0.04 0.03 0.02 0.01 0.00

Closing balance 6.11 4.67 3.24 1.80 0.36


Repayment 0.12 0.12 0.12 0.12 0.12

Interest 0.04 0.03 0.02 0.01 0.00

Closing balance 5.99 4.55 3.12 1.68 0.24


Repayment 0.12 0.12 0.12 0.12 0.12

Interest 0.04 0.03 0.02 0.01 0.00

Closing balance 5.87 4.43 3.00 1.56 0.12


Repayment 0.12 0.12 0.12 0.12 0.12

Interest 0.04 0.03 0.02 0.01 0.00

Closing balance 5.75 4.31 2.88 1.44 0.00


Interest 0.49 0.41 0.29 0.18 0.06


(Rs. in lacs)

Year 1 2 3 4 5 TOTAL

Profit After Tax (Net Profit) 2.00 1.36 2.31 2.40 2.49

Depreciation 0.40 0.40 0.40 0.40 0.40

Interest 0.49 0.41 0.29 0.18 0.06

Total 2.89 2.17 3.01 2.99 2.96 14.02

Interest 0.49 0.41 0.29 0.18 0.06

Loan repayment 0.36 1.44 1.44 1.44 1.44

Total 0.85 1.85 1.73 1.62 1.50 7.54

DSCR 3.42 1.18 1.74 1.85 1.97

Average DSCR = 1.86


(Rs. in lacs)

Year 1 2 3


B. Variable cost

Raw materials & consumables 6.33 7.60 8.86

Power 0.07 0.08 0.09

Miscellaneous expenses 0.11 0.13 0.15




Salary 2.88 2.89 2.91







G. Cash BEP 40.11% 39.45% 38.39%


(Rs. in lacs)

Year 0 1 2 3 4 5

CASH OUTFLOW

Capital Expenditure 8.31 0.00 0.00 0.00 0.00 0.00

Working Capital 0.00 1.55 0.24 0.24 0.00 0.00

Total (A) 8.31 1.55 0.24 0.00 0.00 0.00

CASH INFLOW

Profit After Tax 2.00 1.36 2.31 2.40 2.49

Add: Depreciation 0.40 0.40 0.40 0.40 0.40

Add: Interest 0.49 0.41 0.29 0.18 0.06


Total (B) 0.00 2.89 2.17 3.01 2.99 3.79

NET FLOW (B-A) -8.31 1.34 1.93 3.01 2.99 3.79

IRR = 15%

1.0 INTRODUCTION Disposable paper plates are made out of special quality paper reinforced with polythene sheets to

make it leak proof. These products are conveniently used for serving eatables during parties,

functions, workshops, etc. Most of the sweet shops use it for serving their customers. These are a

convenient replacement for crockery and utensils. These have many advantages over conventional

crockery/ steel utensils. Whereas conventional utensils need care in handling, have to be cleaned

before and after use need lot of space for storage and are difficult to handle, these products are

light in weight, are disposable after use, cheaper and can be stored easily.

This project profile is for production of disposable paper plates with installed capacity of 96 lacs

plates per annum, based on 300 working days per annum and 8 working hours per day.

2.0 MARKET POTENTIAL These products have an urban as well as rural market. These products are mostly used during

social functions, religious gatherings, parties, marriages, outings, in sweet shops, by caterers etc.

The products have many advantages and are hence preferred as compared to standard utensils/

crockery for serving eatables. They can easily be disposed off after use and hence save a lot of

labour as far as cleaning/ drying of utensils are concerned. These are easily transportable and

easy to handle. In our country, people are religious and organize functions throughout the year. All

such occasions call for social gathering and celebrations with meals, snacks sweets being served.

Further, our vast population organizes marriages, celebrates birthdays and other family functions

on a regular basis. Sweet shops and small eateries can be found at every street corner and all

such joints use these disposable plates and bowls. Thus keeping in view the culture of the people

and the habits there is a vast market for the products not only in urban areas but also in rural

areas.

3.0 MANUFACTURING PROCESS The process of manufacturing is not complicated. The product is manufactured using the specific die. The paper and the polythene sheets are previously cut to size or can also be purchased as per the production requirement. The specific die is mounted on the press and the die is heated to the desired temperature. The two layers of paper and the polythene sheets are placed in between the male-female die parts and pressure is applied so that the product takes shape. The formed product is next removed and another set is loaded. The machine is an ordinary press with one fixed platform and another moving plunger. The movement of the plunger is through hydraulic mechanism.

The formed products are collected and the edges are trimmed to give it a proper shape. The plates and bowls are packed separately and stocked for dispatch.




Land & Building 1.50






TOTAL 10.53

4.1 Land & Building: No cost has been considered for land & construction of building. It is assumed that the unit will be set up on a leased premise. Expenses for renovation works is given below.


Renovation of premise 150 1000 150000



Particulars Quantity Rate (Rs) Amount (Rs)

Automatic paper plate making machine 2 180800 361600


Sub total 371600

Add: Transporation, taxes, etc @ 15% 55740

TOTAL 427340






TOTAL 40000


4.6 Preliminary & pre-operative expenses: Details of preliminary & pre-operative expenses are

given below.

(Rs. In lacs)






TOTAL 0.46


cost of renovation works, machinery & equipments and miscellaneous fixed assets.


(Rs. In lacs)

Period (Days)

Amount (Rs)



Power 30 0.03 0.03 0.04

Rent 30 0.15 0.15 0.15

Salary 30 0.19 0.19 0.19


Receivables 15 0.99 1.18 1.38

Total 3.72 4.36 5.00

Working Capital Margin in Yr 1 (100%) 3.72




EQUITY



DEBT


TOTAL 100% 10.53


(Rs. in lacs)


A. INCOME

Production capacity (bundles/ annum) 192000 192000 192000 192000 192000



Price of paper plate bundle (Rs/bundle) 25 25 25 25 25




Power 0.32 0.39 0.45 0.45 0.45

Rent 1.80 1.80 1.80 1.80 1.80

Salary 2.28 2.29 2.30 2.31 2.33


Selling Expenses 0.24 0.29 0.34 0.34 0.34






Depreciation 0.38 0.38 0.38 0.38 0.38


Net Profit 4.39 1.87 3.11 3.19 3.28



6.1 Production capacity: Total production of paper plate bundles at installed capacity is

estimated as below.

Rated machine capacity (No. of plates/ hr) 4000

No. of machines 2

No. of hrs/ day 8


Total quantity of paper plates/ annum 19200000

No. of plates/ bundle 100

Total production of bundles per annum at installed capacity 192000

6.2 Raw material & consumables: Expenses on raw material and consumables at installed


Total quantity of paper plates 19200000

Quantity of plates/ kg 250

Total production by weight (kg) 76800

Consumption of raw materials by weight (kg) including wastage @ 2% 78336

Proportion of paper by weight (%) 99%

Proportion of plastic film by weight (%) 1%

Total quantity of paper at 100% capacity (kg) 77553

Total quantity of plastic film at 100% capacity (kg) 783

Price of paper (Rs/ kg) 40

Price of plastic film (Rs/ kg) 120

Expenses on paper at 100% capacity (Rs) 3102106

Expenses on plastic film 94003

Expenses on raw materials 3196109

Add: Expenses on consumables @ 10% 319611

Expenses on raw material & consumables at installed capacity (Rs) 3515720



Automatic paper plate making machine 2 2.24 4.48


Others LS LS 1.00


No. of hrs/ day 8


Annual power requirement (kwh) 14342


Expenses on power at installed capacity (Rs) 64541

6.4 Rent: Monthly rent for the leased premise is estimated at Rs 15,000/- per month.

6.5 Salary: Expenses on salary in the 1st year are estimated as given below. It is assumed that





Sales Staff 1 4000 48000

Helpers 2 2500 60000





(Rs. in lacs)


Land & Building 1.50 1% 0.02


Misc. Fixed assets 0.40 2% 0.01






(Rs in lacs)


annum (Rs)

Land & Building 1.50 3.34% 0.05


Misc. Fixed assets 0.40 6.23% 0.02

TOTAL 0.38

6.10 Interest on term loan & principal repayment: Interest rate has been assumed at 8%.



given below.

(Rs in lakh)



Repayment 0.00 0.12 0.12 0.12 0.12

Interest (8%) 0.04 0.04 0.03 0.02 0.01

Closing balance 6.32 5.82 4.34 2.85 1.36


Repayment 0.00 0.12 0.12 0.12 0.12

Interest 0.04 0.04 0.03 0.02 0.01

Closing balance 6.32 5.70 4.21 2.73 1.24


Repayment 0.00 0.12 0.12 0.12 0.12

Interest 0.04 0.04 0.03 0.02 0.01

Closing balance 6.32 5.58 4.09 2.60 1.12


Repayment 0.00 0.12 0.12 0.12 0.12

Interest 0.04 0.04 0.03 0.02 0.01

Closing balance 6.32 5.45 3.97 2.48 0.99


Repayment 0.00 0.12 0.12 0.12 0.12

Interest 0.04 0.04 0.03 0.02 0.01

Closing balance 6.32 5.33 3.84 2.35 0.87


Repayment 0.00 0.12 0.12 0.12 0.12

Interest 0.04 0.04 0.03 0.02 0.01

Closing balance 6.32 5.20 3.72 2.23 0.74


Repayment 0.00 0.12 0.12 0.12 0.12

Interest 0.04 0.03 0.02 0.01 0.00

Closing balance 6.32 5.08 3.59 2.11 0.62


Repayment 0.00 0.12 0.12 0.12 0.12

Interest 0.04 0.03 0.02 0.01 0.00

Closing balance 6.32 4.96 3.47 1.98 0.50


Repayment 0.00 0.12 0.12 0.12 0.12

Interest 0.04 0.03 0.02 0.01 0.00

Closing balance 6.32 4.83 3.35 1.86 0.37


Repayment 0.12 0.12 0.12 0.12 0.12

Interest 0.04 0.03 0.02 0.01 0.00

Closing balance 6.20 4.71 3.22 1.73 0.25


Repayment 0.12 0.12 0.12 0.12 0.12

Interest 0.04 0.03 0.02 0.01 0.00

Closing balance 6.07 4.58 3.10 1.61 0.12


Repayment 0.12 0.12 0.12 0.12 0.12

Interest 0.04 0.03 0.02 0.01 0.00

Closing balance 5.95 4.46 2.97 1.49 0.00


Interest 0.50 0.42 0.30 0.18 0.06


(Rs. in lacs)

Year 1 2 3 4 5 Total


Depreciation 0.38 0.38 0.38 0.38 0.38

Interest 0.50 0.42 0.30 0.18 0.06

Total 5.27 2.67 3.79 3.75 3.72 19.20

Interest 0.50 0.42 0.30 0.18 0.06

Loan repayment 0.37 1.49 1.49 1.49 1.49

Total 0.87 1.91 1.79 1.67 1.55 7.79

DSCR 6.02 1.40 2.12 2.25 2.40

Average DSCR = 2.46


(Rs. in lacs)

Year 1 2 3


B. Variable cost

Raw materials & consumables 17.58 21.09 24.61

Power 0.32 0.39 0.45

Other expenses 0.12 0.14 0.17




Rent 1.80 1.80 1.80

Salary 2.28 2.29 2.30







G. Cash BEP 24.18% 23.73% 22.99%


(Rs. in lacs)

Year 0 1 2 3 4 5

CASH OUTFLOW


Working Capital 0.00 3.72 0.64 0.64 0.00 0.00

Total (A) 6.17 3.72 0.64 0.64 0.00 0.00

CASH INFLOW

Profit After Tax 4.39 1.87 3.11 3.19 3.28


Add: Interest 0.50 0.42 0.30 0.18 0.06

Add: Salvage Value

Total (B) 0.00 5.27 2.67 3.79 3.75 3.72

NET FLOW (B-A) -6.17 1.55 2.03 3.14 3.75 3.72

IRR = 30%

1.0 INTRODUCTION Corrugated Box is the most popular shipping container, now-a-days. The box is manufactured from

corrugated board, which consists of 3 or more layers of kraft paper. The middle fluted layer is

pasted with two flat parallel sheets of paper. The boxes find their number of applications in the

packaging of chemicals & drugs, tobacco, engineering goods, canned & bottled goods, food

products, lamps, electrical appliances, glasswares etc. Corrugated boxes have replaced wooden

boxes & crates in many applications. Today, about 80% of all shipments in the world are being

made in fibre board boxes.

Corrugated fibre board consists of a flat layer of paper sheet (liner) glued on one or both sides of a

corrugated paper (medium). The corrugated board is made by passing two layers of paper (usually

kraft) through corrugating machine. One layer of paper becomes corrugated after being passed

through the heated rolls and other is brought into contact with it after the former having glued at

tips. The corrugating 'medium' is generally made from a 0.009" thick (9 caliper) or 0.23 mm. The

glue frequently used is starch or silicate of soda adhesive. When only one liner is used, the product

is known as "Single face" or "two ply" board. This board is flexible in one direction. When the

corrugated medium is combined on both sides with flat sheets, it is known as double faced or "3-

ply board".

This project profile is for setting up of a corrugated box manufactuirng unit with single face

fibreboards having installed capacity of 900 tonnes per annum, based on 300 working days per

annum and 8 working hours per day.

2.0 MARKET POTENTIAL Packaging industry has witnessed a substantial turnaround in India during the past years

considering the changes in the lifestyle as well as development of the economy. It is among the

high growth industries and a high degree of potential exists for almost all user segments, which are

expanding appreciably. Corrugated boxes market in India was estimated at ~INR 108 Billion in FY

2012. Market size of corrugated boxes has grown at a CAGR of ~12% over the period FY 2008-12.

Market size of the corrugated box industry is estimated to grow at a CAGR of ~14% over the

period FY 2012-15 to reach ~INR 159 Billion by FY 2014.

India’s per capita consumption of corrugated boxes is just 1.5 kg while the global average is close

to 15 kg and the US average 80 kg. According to a study, about 95 per cent of all products are

packed in corrugated boxes in the US, an indication of the vast potential in the business.

3.0 MANUFACTURING PROCESS The process of manufacture of corrugated fibreboard & boxes comprises of two sections viz. corrugated board making and box making section.

Manufacture of corrugated board: Corrugated board is made of a corrugated paper sheet of paper glued to the facings of flat-paper, usually kraft. A corrugating machine is employed for the corrugation of flat sheet and preparation of corrugated flexible 2 ply board. The machine is called as single-face corrugating machine. One layer of paper becomes corrugated after passing through the heated fluted rolls and the other is brought in contact with the former having been glued at the tips. These two sheets get pasted together and are wound in rolls. The resulting roll is known as single face or 2-ply corrugated board.

By cutting this roll with board cutter machine, glueing the corrugated side on pasting machine & then placing 3rd ply of paper over it, double face or 3-ply corrugated board is produced. Similarly, board to board can be pasted to form thicker boards i.e. 5-ply, 7-ply and 9-ply boards.

Manufacture of boxes: The corrugated board produced as above is dried (for drying of glue) and may now be processed further to produce-corrugated boxes.

The size of a box is always given in terms of the inside dimensions, with the longer dimension (length) of the opening given first followed by width and depth. The most economical box for a

given cubic contents has the proportions of 2:1:2 (L:W:D). However, other proportions may also be used. For manufacturing boxes of any particular dimensions, it is first decided as to how the blanks for the boxes should be cut to minimise the wastage.

The various steps involved in the fabrication of corrugated fibre board boxes are: Slitting & creasing; slotting; flap or corner cutting and stitching or gluing. Cutting and creasing are simultaneously carried out over a rotary cutting & creasing machine. The trimmed and creased sheet is slotted and flapped out on an eccentric slotter. Finally, it is either stitched using stiching machine or glued/taped manually. The boxes are shiped in the form of flat tube, which is set up and closed by the packer.

Printing: There are different methods of printing the corrugated boxes. Some of the small scale manufacturers are printing the boxes after fabrication, by the technique of screen printing. However, printing can be done in a printer slotter machine. In this machine, the blanks are printed using soft rubber dies and the body score or vertical score and slots are introduced in the board.

Printing can also be performed on the paper sheet, before making corrugated sheet/board. The layer of paper, which will come outside of the box, is printed on flexographic machine.

The formed products are collected and the edges are trimmed to give it a proper shape. The plates and bowls are packed separately and stocked for dispatch.





Building & civil works 30.03


Misc. Fixed assets 11.00

Preliminary & pre-operative expenses 7.38

Contingencies & escalation @ 3% 2.65

Working capital margin 6.47

TOTAL 104.88

4.1 Land & Site Development: No cost has been considered for land. Expenses on site development are estimated as below.


Internal roads 100 400 40000

Boundary wall 140 rm 3000 420000

Site levelling, Gate, etc. LS LS 100000

TOTAL 560000




Workshed (Open shed, CGI sheet roof, concrete floor)

300 3500 1050000

Store room (Brick wall, CGI sheet roof, concrete floor)

150 6000 900000

Labor quarters (Brick wall, CGI sheet roof, concrete floor)

80 6000 480000

Administrative Room (Brick wall, CGI sheet roof, concrete floor)

50 6000 300000

Sub total 2730000


TOTAL 3003000




Single face corrugating machine 1 400000 400000

Reel to sheet cutting machine 1 200000 200000

Creasing and cutting machine 1 250000 250000

Eccentric slotter 1 250000 250000

Partition slotter 1 80000 80000

Stitching machine 2 50000 100000

Vertical Bending machine 1 200000 200000

Single slotting machine 1 30000 30000

Multi color offset printing machine 1 1500000 1500000

Screen printing equipment 1 100000 100000

Grammage tester 1 10000 10000

Bursting Strength factor tester 1 50000 50000

Puncture Resistance teste 1 60000 60000

Compression Strength Tester 1 300000 300000


Sub total 3630000


TOTAL 4174500




Installation of tubewell 1 150000 150000

Transformer & power connection 1 300000 300000

40 KVA DG Set 1 300000 300000

Weighing machine 2 50000 100000

Fire fighting equipments LS LS 50000



Sub total 1000000

Add: Installation, transporation, taxes etc @ 10% 100000

TOTAL 1100000


4.5 Preliminary & Pre-operative Expenses: Details of preliminary & pre-operative expenses

are given below.

(Rs. in lacs)






TOTAL 7.38


cost of site development, building & civil works, plant & machinery and miscellaneous fixed

assets.


(Rs. in lacs)

Period (Days)

Amount (Rs)


Raw Materials & Consumables 15 4.27 5.13 5.98

Power & fuel 30 0.17 0.20 0.24

Salary 30 0.77 0.77 0.78


Receivables 15 6.10 6.66 7.77

Total 16.18 18.51 21.41





EQUITY



DEBT


TOTAL 100% 104.88


(Rs. in lacs)


A. INCOME

Installed capacity (tonnes/ annum) of corrugated boxes

900 900 900 900 900 900 900


Total production at capacity utilisation 450 540 630 630 630 630 630

Sale price (Rs/ tonne) 33000 30000 30000 30000 30000 30000 30000



Raw Materials & Consumables 103.95 124.74 145.53 145.53 145.53 145.53 145.53

Power & fuel 2.06 2.48 2.89 2.89 2.89 2.89 2.89

Salary 9.36 9.41 9.45 9.50 9.55 9.60 9.64


Selling & administrative expenses

1.49 1.62 1.89 1.89 1.89 1.89 1.89



Less: working expenses capitalised

6.47 0.00 0.00 0.00 0.00 0.00 0.00



Depreciation 3.90 3.90 3.90 3.90 3.90 3.90 3.90


Interest on Working Capital 1.55 1.78 2.06 2.06 2.06 2.06 2.06

Loan

Net Profit 22.62 8.82 15.16 16.37 17.57 18.76 19.94



6.1 Raw material & consumables: Expenses on raw material and consumables at installed


Installed production capacity (Tonnes) 900

Scaling loss 5%

Total consumption of raw materials & consumables (Tonnes) 945

Avg price (Rs/ tonne) 22000




Connected load (kw) 40

Avg load factor 70%

Proportion running on power (%) 80%

Hrs/ day 8

Days/ annum 300


Rate (Rs/ unit) 5

Expenses on power (Rs) 268800


Proportion running on diesel (%) 20%

Hrs/ annum 480

Consumption (litres/ hr) 6

Price (Rs/ litre) 50


Expenses on power & fuel at installed capacity (Rs) 412800

6.3 Salary: Expenses on salary in the 1st year are estimated as given below. It is assumed that



Plant Manager 1 10000 120000

Supervisor 1 8000 96000


Sales staff/ administrative staff 3 4000 144000






(Rs. in lacs)


Building & civil works 30.58 1% 0.31




6.5 Selling & Administrative Expenses: Selling expenses have been assumed at 1% of sales.




(Rs in lacs)


annum (Rs)

Building & civil works 30.03 3.34% 1.00



TOTAL 3.90


at 16%. The details of calculation are given below.

(Rs. in lacs)



Bank Loan (60%) 9.71 11.11 12.84

Interest @ 16% 1.55 1.78 2.06

6.9 Interest on term loan & principal repayment: Interest rate on term loan has been assumed

at 13.5%. Duration of Loan repayment has been considered for a period of 7 years including

moratarium period of 12 months with equal monthly installments. The details of calculation

are given below.

(Rs in lakh)

Month Year 1 2 3 4 5 6 7


Repayment 0.00 0.84 0.84 0.84 0.84 0.84 0.84

Interest (13.5%) 0.71 0.68 0.57 0.45 0.34 0.23 0.11

Closing balance 62.93 59.57 49.50 39.44 29.37 19.30 9.23


Repayment 0.00 0.84 0.84 0.84 0.84 0.84 0.84

Interest 0.71 0.67 0.56 0.44 0.33 0.22 0.10

Closing balance 62.93 58.73 48.67 38.60 28.53 18.46 8.39


Repayment 0.00 0.84 0.84 0.84 0.84 0.84 0.84

Interest 0.71 0.66 0.55 0.43 0.32 0.21 0.09

Closing balance 62.93 57.89 47.83 37.76 27.69 17.62 7.55


Repayment 0.00 0.84 0.84 0.84 0.84 0.84 0.84

Interest 0.71 0.65 0.54 0.42 0.31 0.20 0.08

Closing balance 62.93 57.06 46.99 36.92 26.85 16.78 6.71


Repayment 0.00 0.84 0.84 0.84 0.84 0.84 0.84

Interest 0.71 0.64 0.53 0.42 0.30 0.19 0.08

Closing balance 62.93 56.22 46.15 36.08 26.01 15.94 5.87


Repayment 0.00 0.84 0.84 0.84 0.84 0.84 0.84

Interest 0.71 0.63 0.52 0.41 0.29 0.18 0.07

Closing balance 62.93 55.38 45.31 35.24 25.17 15.10 5.03


Repayment 0.00 0.84 0.84 0.84 0.84 0.84 0.84

Interest 0.71 0.62 0.51 0.40 0.28 0.17 0.06

Closing balance 62.93 54.54 44.47 34.40 24.33 14.26 4.20


Repayment 0.00 0.84 0.84 0.84 0.84 0.84 0.84

Interest 0.71 0.61 0.50 0.39 0.27 0.16 0.05

Closing balance 62.93 53.70 43.63 33.56 23.49 13.42 3.36


Repayment 0.00 0.84 0.84 0.84 0.84 0.84 0.84

Interest 0.71 0.60 0.49 0.38 0.26 0.15 0.04

Closing balance 62.93 52.86 42.79 32.72 22.65 12.59 2.52


Repayment 0.84 0.84 0.84 0.84 0.84 0.84 0.84

Interest 0.71 0.59 0.48 0.37 0.25 0.14 0.03

Closing balance 62.09 52.02 41.95 31.88 21.82 11.75 1.68


Repayment 0.84 0.84 0.84 0.84 0.84 0.84 0.84

Interest 0.70 0.59 0.47 0.36 0.25 0.13 0.02

Closing balance 61.25 51.18 41.11 31.05 20.98 10.91 0.84


Repayment 0.84 0.84 0.84 0.84 0.84 0.84 0.84

Interest 0.69 0.58 0.46 0.35 0.24 0.12 0.01

Closing balance 60.41 50.34 40.27 30.21 20.14 10.07 0.00


Interest 8.47 7.53 6.17 4.81 3.45 2.10 0.74


(Rs. in lacs)

Year 1 2 3 4 5 6 7 TOTAL


Depreciation 3.90 3.90 3.90 3.90 3.90 3.90 3.90

Interest 8.47 7.53 6.17 4.81 3.45 2.10 0.74

Total 34.99 20.26 25.23 25.09 24.93 24.76 24.58 179.84

Interest 8.47 7.53 6.17 4.81 3.45 2.10 0.74

Loan repayment 2.52 10.07 10.07 10.07 10.07 10.07 10.07

Total 10.98 17.60 16.24 14.88 13.52 12.16 10.80 96.20

DSCR 3.19 1.15 1.55 1.69 1.84 2.04 2.27

Average DSCR = 1.87


(Rs. in lacs)

Year 1 2 3


B. Variable cost

Raw Materials & Consumables 103.95 124.74 145.53

Power & fuel 2.06 2.48 2.89

Selling & administrative expenses 1.49 1.62 1.89






Salary 9.36 9.41 9.45







G. Cash BEP 24.10% 35.03% 32.61%


(Rs. in lacs)

Year 0 1 2 3 4 5 6 7 8 9 10

CASH OUTFLOW

Capital Expenditure 88.38 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00

Working Capital 0.00 16.18 2.33 2.90 0.00 0.00 0.00 0.00 0.00 0.00 0.00

Total (A) 88.38 16.18 2.33 2.90 0.00 0.00 0.00 0.00 0.00 0.00 0.00

CASH INFLOW

Profit After Tax 22.62 8.82 15.16 16.37 17.57 18.76 19.94 20.48 20.27 20.04

Add: Depreciation 3.90 3.90 3.90 3.90 3.90 3.90 3.90 3.90 3.90 3.90

Add: Interest 8.47 7.53 6.17 4.81 3.45 2.10 0.74 0.00 0.00 0.00

Add: Salvage Value

Total (B) 0.00 34.99 20.26 25.23 25.09 24.93 24.76 24.58 24.38 24.17 23.95

NET FLOW (B-A) -88.38 18.81 17.93 22.34 25.09 24.93 24.76 24.58 24.38 24.17 23.95

IRR = 21%

1.0 INTRODUCTION Sugandhmantri is a rhizomatous aromatic perennial herb found in Assam, lower altitudes of

Arunachal, Nagaland, Tripura etc. The dry rhizomes are known in trade as ‘Sugandhmantri’. Stem

short, slow growing, leaves radical with sheathing bases, long petioled, sagittate - cordate. The

large rhizomes bearing withered leaf scales and numerous white rootlets are esteemed as an

aromatic stimulant. Its aromatic rhizomes contain an essential oil used for blending of many

oriental perfumes. Steam distillation of rhizome yields yellow coloured essential oil about 1.0% on

air-dry basis. The essential oil has a very good demand in perfumery and cosmetic industries. The

spent material after extraction of essential oil is largely used in Dhup manufacturing.

More than 400 MT of dry rhizomes are collected and transported to outside the state mainly to

Kannauj, Kanpur, Delhi, Kolkata, Mumbai etc from Barak Valley of Assam and other parts of the

region every year.

It is being exploited as a minor forest product since long back without conservation and/or

cultivation measures. If this is continued unabated very soon this unique and valuable species will

be extinct from its place of origin.

This project profile is for commercial cultivation of Sugandmantri and setting up of a distilaltion unit

with total area under plant at 4 hectares.

2.0 PACKAGE OF PRACTICES

(i) Soil: Sandy and sandy loam to clay loam with organic litter is found suitable. Temporary water logging for 24-48 hours is beneficial for quick rhizome elongation. The plant prefers acidic soil of pH range 4.9 - 5.5.

(ii) Climate: Being a sub - tropical species it loves warm and humid climate with annual rainfall ranging from 2000-3000 mm.

(iii) Stock Nursery: A stock nursery is important for commercial cultivation. Generally 1/5th of the target area is brought under this nursery one year ahead of plantation. This is well nursed with adequate manuring and fertilization, mulching and other intercultural operations. By doing so cost of planting material can be reduced by about 40%.

(iv) Propogation: The individual seed material is the piece of rhizome with active buds of 2.5-3 cm size. Fresh rhizome pieces with active buds may be sprouted in sand beds before planting in main field.

(v) Land Preparation: Land is prepared by deep ploughing or hoeing with addition of suflicient quantity of organic matter.

(vi) Planting: Appropriate method of planting is ridge and furrow method. 15 cm deep furrows are opened at 30 cm apart. Rhizome pieces after sprouting are planted in the furrows at 45 cm apart and covered with soil up to 5-7 cm. Rest part is filled up by rice husk or other available mulch material. Rice husk is more beneficial as it takes longer time to decompose and thus helps in rhizome elongation. When fresh cuttings are planted sprouting starts within 30 days of planting. 20-22 q of fresh rhizome / ha is required to get a plant population of 75000.

(vii) Fertilizers: 40:50:60 kg N, P205 and K20/ha per year may be applied. Entire quantity of P and K are applied along with organic matter as basal. N is applied in 3 equal splits starting from 40 days after planting.

(viii) Interculture: It is weed-suppressing crop and one or two light hoeing in the first and second month of planting is enough to keep down the weed population. Removal of old and dry leaf and sheath is beneficial for rhizome elongation.

(ix) Harvesting: Sugandhmantri becomes ready for rhizome harvest on 3rd year of planting. However, the crop can also be harvested in the second year. But three years rotation period has been observed to be more profitable from both yield and quality of the products.

It is harvested during winter, rain free period (November-April). During this period it is observed that the vegetative growth as well as moisture content of rhizome is minimum and the oil accumulation is maximum. The rhizomes attain a length of 20-30 cm or more in three years. Rhizome exceeding 15 cm long is chosen for harvesting. Harvesting is done using hand Chiprang or garden hoe that may require digging out the rhizome from 5-10 cm deep. During harvest the side suckers may be left undisturbed for ratoon crops. Harvest may be taken every year by selection of well-grown rhizome starting from third year upto 10th year and then terminated or one time harvesting after 30 - 32 months may also be done. For ratoon crop, manuring & fertilization should be done every year with pre monsoon shower.

(x) Rhizome Processing: After harvest, the leaves, stalks with leaf sheath and roots are removed and cleaned and then spread on floor. Clean rhizomes are then cut into 2.5-3 cm pieces and dried by using deemed fire and smoke. When about 50% drying takes place then they are taken out and dried under sun till a rattling sound on handling is obtained. The fresh and dry ratio of about 5.5 : 1 is safe for storing or distillation.

(xi) Yield of Rhizome: Fresh yield is about 10-12 times of planting material and thus average fresh yield after 3 years is about 240 q / ha. On drying it yields about 50 q dry rhizomes, which on steam distillation may yield 45 - 48 kg of essential oil at 1.0% recovery.

(xii) Distillation: After drying, distillation should be done within one month to get maximum recovery (1 % or more). With ageing, oil recovery goes down to 0.8 % (if distilled after 3 months of storing). Since the oil glands are situated inside the rhizome, which contains lot of starch, it has to be disintegrated or crushed to expose the oil glands in such way that during the process heat is not generated. Heat generation will destroy considerable quantity of oil. Distillation process takes about 10-12 hours to exhaust one batch. At the end of distillation, oil is taken out from the receiver and is treated with anhydrous sodium sulphate salt @ 15 - 20 g /litre of oil. After making water free and filtering, the oil is stored in aluminum container. The spent material obtained after oil extraction is utilized as organic manure or as a raw material for Dhup or other incense sticks manufacturing. After disintegration or crushing, the material should be put into the distillation tank immediately to avoid loss of oil.

3.0 COST OF THE PROJECT The estimated project cost is given below.

( Rs. in lacs)


Land & Site Development -




Setting up of Nursery 2.39

Preparation of Seedlings 0.72

Land Preparation 0.20

Planting 0.60



TOTAL 17.97

3.1 Land & Site Development: No cost has been considered for land & site development. It is assumed that the unit will be set up in existing farmland.


Particulars Area (Sqft) Rate (Rs) Amount (Rs)

Distillation Shed (Open shed, CGI sheet roofings, kuttcha Floor)

400 300 120000

Labor quarter cum Store room (Brick wall, CGI sheet roof, concrete floor)

720 400 288000

Sub total 408000


TOTAL 448800




Dictillation unit (Hydro-steam and lifting type, capacity 1.0 MT/ batch, made of 304 grade stainless steel with all accessories and tax)

1 320000 320000

Add transporation, installation, etc @ 20% 64000

TOTAL 384000




Water Supply System (STW boring, storage, 3 hp pump set, pipes & fittings)

1 75000 75000

Maiscellaneous items LS LS 10000

TOTAL 85000


3.5 Setting up of a Nursery: Details of expenses for setting up of a nursery is given below.

Target area for cultivation (in ha) 4 Area required for raising of mother stock in sqm (1/5 of target area) 8000 Number of seedlings required (75,000/ ha) 60000 Particulars Unit Quantity Rate (Rs) Amount (Rs)

Purchase of seedlings Nos 60000 3 180000

Engagement of labor for nursery land preparation

Mandays/ ha

25 200 4000

Engagement of labor for planting of seedlings Mandays/

ha 75 200 12000

Cost of FYM kg/ ha 18000 0.20 2880

Sub-total 198880

Add: Maintenance for seedlings for 6 months, etc. @ 20% 39776

TOTAL 238656


3.6 Preparation of Seedlings: Details of expenses for preparation of seedlings is given below.

No. of seedlings required per ha 75000

Target area for cultivation (in ha) 4

Total No. of seedlings required 300000

Particulars Unit Quantity Rate (Rs) Amount

(Rs)

Engagement of labor for cutting the rhizomes into 2 inch pieces

Manday/ 1000 Nos

1 200 60000

Add: Cost of drying, etc @ 20% 12000

TOTAL 72000


3.7 Land Preparation for Nursery: Details of expenses for land preparation of nursery is given

below.

Particulars Mandays/

ha Rate (Rs)

Area under crop (ha)

Amount (Rs)

Engagement of labor for land preparation 25 200 4 20000


3.8 Planting: Details of expenses for planting in nursery is given below.


ha Rate (Rs)


Amount (Rs)

Engagement of labor for planting of seedlings 75 200 4 60000



are given below.

( Rs. in lacs)





TOTAL 0.70


( Rs. in lacs)

Particulars Yr 1 Yr 2 Yr 3

Total operating expenses 2.15 2.03 4.54

Operating expenses capitalised for Yr 1 & Yr 2 4.18

4.0 MEANS OF FINANCE The means of finance for the project is estimated as below.

( Rs. in lacs)


EQUITY



DEBT


TOTAL 100% 17.97


(Rs. in lacs)


A. INCOME

Oil production per annum (in kg) 0 0 192 192 192 192 192

Oil price (Rs. per kg) 4500 4500 4500 4500 4500 4500 4500

Income from sale of oil (Rs lakh) 0.00 0.00 8.64 8.64 8.64 8.64 8.64


Manures & Fertilizers 0.26 0.12 0.12 0.12 0.12 0.12 0.12

Weed Control & Intercultural Operations

0.60 0.60 0.60 0.60 0.60 0.60 0.60

Harvesting 0.00 0.00 0.32 0.32 0.32 0.32 0.32

Post Harvest Operations 0.00 0.00 0.32 0.32 0.32 0.32 0.32

Distillation 0.00 0.00 1.77 1.77 1.77 1.77 1.77

Power 0.12 0.12 0.12 0.12 0.12 0.12 0.12

Salary 1.08 1.09 1.10 1.11 1.12 1.14 1.15


Miscellaenous Expenses 0.00 0.00 0.09 0.09 0.09 0.09 0.09


Less: operating expenses capitalised

2.15 2.03 0.00 0.00 0.00 0.00 0.00



Depreciation 0.47 0.47 0.47 0.47 0.47 0.47 0.47


Expenses on nursery written off 0.24 0.24 0.24 0.24 0.24 0.24 0.24

Expenses on preparation of seedlings written off

0.07 0.07 0.07 0.07 0.07 0.07 0.07

Expenses on land preparation written off

0.02 0.02 0.02 0.02 0.02 0.02 0.02

Expenses on planting of seedlings written off

0.06 0.06 0.06 0.06 0.06 0.06 0.06

Net Profit -1.40 -1.40 2.72 2.86 3.03 3.20 3.36

Net cash accruels -0.53 -0.53 3.58 3.73 3.89 4.06 4.23

Principle repayment 0.00 0.00 1.20 2.40 2.40 2.40 2.40

6.1 Estimation of Production: Production of oil is estimated as below.

Particulars Unit Quantity

Yield of fresh rhizomes/ hectare/ harvest kg 24000

Area under crop ha 4

Total yield of fresh rhizomes kg 96000

Recovery rate of dry rhizomes % 20%

Yield of dry rhizomes/ harvest kg 19200

Yr 1 Yr 2 Yr 3 Yr 4 Yr 5 Yr 6 Yr 7

Number of harvests/ year (Gestation period of 2 years; subsequent harvests at yearly intervals upto 10 years)

0 0 1 1 1 1 1

Yield of dry rhizomes/ year (in kg)

0 0 19200 19200 19200 19200 19200

Percentage of oil recovery 1.00% 1.00% 1.00% 1.00% 1.00% 1.00% 1.00%

Total oil production per annum (in kg)

0 0 192 192 192 192 192

6.2 Manures & Fertilizers: Expenses on manures & fertilizers is estimated as below.

Particulars Kg/ ha

Source Nutrient

% Kg/ ha

(source)

Cost/ kg of

Source (Rs)

Cost/ ha

(Rs)


Amount (Rs)

Expenses on Nitrogen/ application

40 Urea 46% 87 5.50 478 4 1913

Expenses on Phosphorus/ application

50 SSP 16% 313 4.00 1250 4 5000

Expenses on Potassium/ application

60 MOP 60% 100 12.00 1200 4 4800


Application of Manures during land preparation in Year 1 (18000 kg/ ha @ Rs 0.20/ kg)

14400

Application of Nitrogen/ annum

1 1 1 1 1 1 1

Cost (Rs) 1913 1913 1913 1913 1913 1913 1913

Application of Phosphorus/ annum

1 1 1 1 1 1 1

Cost (Rs) 5000 5000 5000 5000 5000 5000 5000

Application of Potassium/ annum

1 1 1 1 1 1 1

Cost (Rs) 4800 4800 4800 4800 4800 4800 4800

Expenses on purchase of manures & fertilizers per annum (Rs)

26113 11713 11713 11713 11713 11713 11713

6.3 Weed Control & Intercultural Operations: Expenses on weed control & intercultural

operations is estimated as below.


ha Rate (Rs)


Cost/ annum

(Rs)

Engagement of labor for weed control & intercultural operations

75 200 4 60000


Number of weed control & intercultural operations per year

1 1 1 1 1 1 1

Expenses on weed control & intercultural operations per annum

60000 60000 60000 60000 60000 60000 60000

6.4 Harvesting: Expenses on harvesting is estimated as below.


ha Rate (Rs)


Cost/ harvest

(Rs)

Engagement of labor for harvesting 40 200 4 32000


Number of harvests/ year (Gestation period of 2 years; subsequent harvests at yearly intervals upto 10 years)

0 0 1 1 1 1 1

Expenses on harvest per annum 0 0 32000 32000 32000 32000 32000

6.5 Post Harvest Operations: Expenses on post harvest operations is estimated as below.


ha

Rate/ manday

(Rs)


Cost/ operation

(Rs)

Engagement of labor for post harvest operations

40 200 4 32000


Number of post harvest operations/ year

0 0 1 1 1 1 1

Expenses on post harvest operations per annum

0 0 32000 32000 32000 32000 32000

6.6 Distillation: Expenses on distillation is estimated as below.

No. of hours per distillation 12

Fuel (Dry herbage) consumption (kg/ hr) 25

Cost of dry herbage per kg (Rs) 5

Expenses on fuel/ distillation (Rs) 1500


Yield of dry rhizomes/ year (in kg) 0 0 19200 19200 19200 19200 19200

Quantity of dry rhizomes per distillation (kg)

250 250 250 250 250 250 250

No. of distillations per annum (Average)

0 0 77 77 77 77 77

Expenses on fuel (Rs) 0 0 115200 115200 115200 115200 115200

Add: engagement of labor (4 mandays/ distillation & manday cost of Rs 200)

0 0 61440 61440 61440 61440 61440

Expenses on distillation per annum (Rs)

0 0 176640 176640 176640 176640 176640

6.7 Power: Expenses on power is estimated as below.

Partiulars Quantity Power (Kw) Total (Kw) Hrs/ day kwh/ day

3 HP Pumpset 1 2.24 2.24 1 2.24


Power requirement/ day (Kwh) 6.72

Days/ annum 360


Expenses on power per annum 12092


expenses on salary will increase @ 1% every subsequent year.

Particulars of Employee Numbers Salary/

Month (Rs) Cost/

annum (Rs)


Helpers 3 3000 108000

Total 108000




(Rs. in lacs)





Total 0.09




(Rs. in lacs)


annum (Rs)




Total 0.47




are given below.

(Rs lakh)

Month Year 1 2 3 4 5 6 7


Repayment 0.00 0.00 0.00 0.20 0.20 0.20 0.20

Interest (8%) 0.07 0.07 0.07 0.06 0.05 0.03 0.02

Closing balance 10.78 10.78 10.78 9.38 6.99 4.59 2.20


Repayment 0.00 0.00 0.00 0.20 0.20 0.20 0.20

Interest 0.07 0.07 0.07 0.06 0.05 0.03 0.01

Closing balance 10.78 10.78 10.78 9.18 6.79 4.39 2.00


Repayment 0.00 0.00 0.00 0.20 0.20 0.20 0.20

Interest 0.07 0.07 0.07 0.06 0.05 0.03 0.01

Closing balance 10.78 10.78 10.78 8.99 6.59 4.19 1.80


Repayment 0.00 0.00 0.00 0.20 0.20 0.20 0.20

Interest 0.07 0.07 0.07 0.06 0.04 0.03 0.01

Closing balance 10.78 10.78 10.78 8.79 6.39 3.99 1.60


Repayment 0.00 0.00 0.00 0.20 0.20 0.20 0.20

Interest 0.07 0.07 0.07 0.06 0.04 0.03 0.01

Closing balance 10.78 10.78 10.78 8.59 6.19 3.79 1.40


Repayment 0.00 0.00 0.00 0.20 0.20 0.20 0.20

Interest 0.07 0.07 0.07 0.06 0.04 0.03 0.01

Closing balance 10.78 10.78 10.78 8.39 5.99 3.59 1.20


Repayment 0.00 0.00 0.20 0.20 0.20 0.20 0.20

Interest 0.07 0.07 0.07 0.06 0.04 0.02 0.01

Closing balance 10.78 10.78 10.58 8.19 5.79 3.39 1.00


Repayment 0.00 0.00 0.20 0.20 0.20 0.20 0.20

Interest 0.07 0.07 0.07 0.05 0.04 0.02 0.01

Closing balance 10.78 10.78 10.38 7.99 5.59 3.19 0.80


Repayment 0.00 0.00 0.20 0.20 0.20 0.20 0.20

Interest 0.07 0.07 0.07 0.05 0.04 0.02 0.01

Closing balance 10.78 10.78 10.18 7.79 5.39 3.00 0.60


Repayment 0.00 0.00 0.20 0.20 0.20 0.20 0.20

Interest 0.07 0.07 0.07 0.05 0.04 0.02 0.00

Closing balance 10.78 10.78 9.98 7.59 5.19 2.80 0.40


Repayment 0.00 0.00 0.20 0.20 0.20 0.20 0.20

Interest 0.07 0.07 0.07 0.05 0.03 0.02 0.00

Closing balance 10.78 10.78 9.78 7.39 4.99 2.60 0.20


Repayment 0.00 0.00 0.20 0.20 0.20 0.20 0.20

Interest 0.07 0.07 0.07 0.05 0.03 0.02 0.00

Closing balance 10.78 10.78 9.58 7.19 4.79 2.40 0.00


Interest 0.86 0.86 0.84 0.68 0.49 0.30 0.10


(Rs. lacs)



Depreciation 0.47 0.47 0.47 0.47 0.47

Interest 0.84 0.68 0.49 0.30 0.10

Total 4.04 4.01 3.99 3.97 3.94 19.95

Interest repayment 0.84 0.68 0.49 0.30 0.10

Loan repayment 0.00 0.00 1.20 2.40 2.40

Total 0.84 0.68 1.69 2.69 2.50 8.40

DSCR 4.79 5.91 2.37 1.47 1.58

Average DSCR = 2.38


(Rs. In lacs)

Year 3 4 5


B. Variable cost

Manures & Fertilizers 0.12 0.12 0.12

Weed Control & Intercultural Operations 0.60 0.60 0.60

Harvesting 0.32 0.32 0.32

Post Harvest Operations 0.32 0.32 0.32

Distillation 1.77 1.77 1.77

Power 0.12 0.12 0.12

Miscellaneoua Expenses 0.09 0.09 0.09




Salary 1.10 1.11 1.12

Repair & Maintenance 0.11 0.12 0.13




E. BREAKEVEN POINT 48% 45% 42%


(Rs. in lacs)

Year 0 1 2 3 4 5 6 7 8 9 10

CASH OUTFLOW

Capital Expenditure 11.57 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00

Working Capital 0.00 0.18 -0.01 0.21 0.00 0.00 0.00 0.00 0.00 0.00 0.00

Total (A) 11.57 0.18 -0.01 0.21 0.00 0.00 0.00 0.00 0.00 0.00 0.00

CASH INFLOW

Profit After Tax -1.40 -1.40 2.72 2.86 3.03 3.20 3.36 3.44 3.41 3.38

Add: Depreciation 0.47 0.47 0.47 0.47 0.47 0.47 0.47 0.47 0.47 0.47

Add: Interest 0.86 0.86 0.84 0.68 0.49 0.30 0.10 0.00 0.00 0.00

Add: Salvage Value

Total (B) 0.00 -0.06 -0.06 4.04 4.01 3.99 3.97 3.94 3.91 3.88 3.85

NET FLOW (B-A) -11.57 -0.24 -0.05 3.83 4.01 3.99 3.96 3.94 3.91 3.88 3.85

IRR = 17%

1.0 INTRODUCTION Stevia is a subtropical perennial that produces sweet steviol glycosides in the leaves for which it

also known as ‘Cheeni Tulsi’ or ‘Mou Tulsi’. Plants grown at higher latitudes actually have a higher

percentage of sweet glycosides. The plant can be utilized as a source for the production of a

natural sweetener (food), as a source of chlorophyll (non-food. Oral-hygiene product, medicine) as

a source of phytosterols (Non-food, Medicine: raw stuff for the synthesis of oral contraceptives,

cholesterol suppressing medicine, antitumour activity against prostrate tumours and activity against

rheumatism), the sweetener can be converted into gibberellins by fermentation (Non-food —

Agrochemicals), the vegetative residue can be used as animal feed and the stalks can be used as

a source of cellulose (Non-food: Cellulose industry).

Its medicinal uses include regulating blood sugar, preventing hypertension, treatment of skin

disorders, and prevention of tooth decay. The compound obtained from stevia is considered to be

the best alternate source for diabetes sufferer. The added value for this new crop can go up to a

considerable extent.

This project profile is for commercial cultivation of Stevia with cultivation area of 3 hectares.

2.0 MARKET POTENTIAL Market opportunity for Stevia is good. Statistics indicate that in some countries upto 30% of their needed sugar has been replaced by stevioside-like sweetness products.


(i) Soil: Stevia prefers a well-drained fertile sandy loam or loam soil, high in organic matter with ample supply of water. It prefers acidic to neutral (pH 6-7) soil for better growth. It requires a consistent supply of moisture, but not waterlogged. Too much soil moisture can cause rot.

(ii) Cilmate: It is a semi-humid subtropical plant that shows higher leaf production under high light intensity and warm temperature. Day length is more critical than light intensity. Long spring and summer days favour leaf growth. Short days trigger blossoming. Stevia prefers partial shade during considerable summer sunshine.

(iii) Propogation: Stevia is usually propagated by stem cuttings, which root easily. Sweetness in leaves varies with varieties. Therefore, for propagation cutting should be obtained from a source, which is high in stevioside and low in associated bitterness. Rooting can be enhanced by using commercial rooting hormones. Cutting should be 2-4 inches long, from leaf axils of current year growth with atleast two leaf buds above ground. All the lower leaves are removed keeping 2or 3 small leaves. Treatment with paclobutrazol @ 100 ppm has been found to induce the root initiation in short time. Effective outcome of this treatment can be obtained when the cuttings are planted during the month of February-March. Propagation can be done in other period also with varying success.

(iv) Land Preparation: Land is either disced and /or harrowed twice to prepare a fairly smooth, firm-planting surface. Around 50 MT of FYM/ha has to be applied as a basal dressing during the last ploughing to incorporate the manure with the soil. With proper drainage and irrigation channels the field is divided into plots of convenient size.

Forming raised beds is the most economical way to grow Stevia. The raised bed should be of 15 cm in height and 60 cm in width. The distance between two rows should be 40 cm and that between each plant 23 cm. This would give a plant population of around 75,000 per hectare.

(v) Planting: March to mid May gives better results. Immediate after planting one irrigation is necessary. The concentration of stevioside in the leaves increases when the plants are grown under long day condition where vegetative period is longer and steviol glycoside yields will be higher.

(vi) Irrigation: It needs irrigation, as Stevia cannot stand drought. Sprinkler irrigation (micro sprinklers) is found to be advantageous since the herb is highly sensitive to water stress and requires frequent light irrigation. During summer irrigation at 3-5 days interval gives best results.

(vii) Manures & Fertilizers: Under average condition application of FYM @ 50 t/ha and fertilizers N-60 kg, P205 30 kg and K20 45 kg/ha is recommended. N is applied in three splits once at basal and remaining two applications after first and second cutting. Stevia plants prefer low nitrogen, but high level of phosphorus and potassium. Slow release nitrogen sources are better due to requirement of low level of N and steady release of N from source. Sometimes stevia shows the symptoms of boron deficiency, which leads to leaf spot and that can be rectified by spraying Borax 6 %. Since the feeder roots tend to be quite near the surface, addition of compost for extra nutrients is beneficial.

(viii) Harvesting: Time of harvesting depends on land type, variety and growing season. The first harvest of the crop can be had in four months after planting and subsequent harvest once every 3 months. Generally it can be scheduled for mid to late September when plants are 50-70 cm in height. Short days induce flowering. Optimum yield (biomass) and stevioside quality and quantity is best obtained just before flowering. The easiest harvesting technique is to cut the branches off with pruning shears before stripping the leaves. The tips of the stems can be clipped off and added to harvest yield, as they contain as much stevioside as do the leaves. On an average three commercial harvests can be obtained per year.

It is better to cut the plants leaving about 10 cm stem portion from the ground. This will facilitate new flushes to emerge, which can be harvested as the next crop. For domestic use leaves may be used fresh for tea or may be combined with mint leaves.

(ix) Drying: Immediately after harvest the herb is dried. This can be accomplished on a screen or net. The freshly harvested plants can be hung upside down and dried in shade. It can also be dried using simple drying racks inside transparent poly house or transparent glass roofing or by passing dry air just above room temperature.

Drying of the stem and soft green leaf material is completed immediately after harvesting utilizing a drying wagon or a kiln or done naturally in case of large-scale production. Depending on weather conditions and density of loading, it generally takes 24 to 48 hours to dry stevia at 400 to 500 C. The drying process does not require excessive heat; more important is good air circulation. On a moderately warm fall day, stevia can be quickly dried in the full sun in about 12 hours. (Longer drying time will lower the stevioside content of the final product). A home dehydrator can also be used, although sun drying is the preferred method.

After adequate drying, the leaves are stripped of the stems/ twigs and packed and stored in cool, dry place. For large-scale commercial production artificial drying and threshing of the dry herbs to separate leaves may be employed.

(x) Yield: About 15000kg/ha of green herb is obtained which on drying gives about 4166 kg/ha. After separating stems this yields about 3000 kg/ha in the first year. Yield goes on decreasing from 3 year of planting and hence terminated.


( Rs. in lacs)




Misc. Assets 0.85

Cost of Seedlings 4.50


Planting 0.45



TOTAL 11.94





720 400 288000

Drying Shed (Open shed with CGI sheet roof) 1000 50 50000


TOTAL 366800





1 320000 320000


TOTAL 384000


4.4 Misc. Assets: Details of miscellaneous assets are given below.


Water supply system (STW boring, storage tank, 3 hp pump set, pipes & fittings)

1 75000 75000


TOTAL 85000


4.5 Cost of Seedlings: Details of expenses for purchase of seedlings is given below.


No. of seedlings required per ha 75000


Price of a seedling (Rs) 2

Total cost (Rs) 450000


4.6 Land Preparation: Details of expenses for land preparation are given below.


ha Rate (Rs)


Amount (Rs)



4.7 Planting: Details of expenses for planting are given below.


ha Rate (Rs)


Amount (Rs)

Engagement of labor for planting of seedlings 75 200 3 45000



are given below.

( Rs. in lacs)





TOTAL 0.42


( Rs. in lacs)

Working capital calculation for Yr 1 Period (Month)

Amount (Rs)

Manures & Fertilizers 3 0.09

Weed control & Intercultural Operations 3 0.11

Harvesting 3 0.18

Post Harvest Operations 3 0.18

Power 3 0.02

Salary 3 0.27

Finished goods 1 0.30

Receivables 1 0.75

TOTAL 1.90



( Rs. in lacs)


EQUITY



DEBT


TOTAL 100% 11.94


(Rs. in lacs)


A. INCOME

Yield of dry leaves per annum (in kg) 9000 9000 9000

Price of dry leaves (Rs. per kg) 100 100 100

Income from sale of spikes (Rs lakh) 9.00 9.00 9.00



Weed control & Intercultural Operations 0.45 0.45 0.45



Power 0.09 0.09 0.09

Salary 1.08 1.08 1.08



Total Operating Expenses 3.55 3.26 3.27

Less: operating expenses capitalised 1.90 0.00 0.00

Operating profit 7.35 5.74 5.73




Expenses on purchase seedlings written off 1.50 1.50 1.50

Expenses on land preparation written off 0.05 0.05 0.05

Expenses on planting written off 0.15 0.15 0.15

Net Profit 4.91 3.47 3.71

Net cash accruels 6.78 5.35 5.59

Principle repayment 0.80 3.19 3.19

6.1 Estimation of Production: Production of dry leaves is estimated as below.


Yield of fresh herbs/ ha/ harvest kg 5000


Total yield kg 15000

Recovery of dry leaves from fresh herbs percent 20%

Yield of dry leaves/ harvest kg 3000

Yr 1 Yr 2 Yr 3

No. of harvests/ annum (3 year crop cycle & gestation period of 3 months)

3 3 3

Yield of dry leaves per annum (in kg) 9000 9000 9000

6.2 Manures & Fertilizers: Expenses on manures & fertilizers is estimated as below.

Particulars Kg/ ha

Source Nutrient

% Kg/ ha

(source)

Cost/ kg of

Source (Rs)

Cost/ ha

(Rs)


Amount (Rs)

Application of Nitrogen (Basal dose)

20 Urea 46% 43 5.50 239 3 717

Application of Phosphorus 30 SSP 16% 188 4.00 750 3 2250

Application of Potassium 45 MOP 60% 75 12.00 900 3 2700

Application of Nitrogen (2nd dose)

20 Urea 46% 43 5.50 239 3 717

Application of Nitrogen (3rd dose) 20 Urea

46% 43 5.50 239 3 717

Yr 1 Yr 2 Yr 3

Annual schedule of application of fertilizers (Nos) 1 1 1

Expenses on fertilizers/ annum (Rs) 6385 6385 6385


30000

Expenses on manures & fertilizers/ annum (Rs) 36386 6386 6386


operations is estimated as below.


ha Rate (Rs)


Cost/ annum (Rs)


75 200 3 45000

Yr 1 Yr 2 Yr 3

Number of weed control & intercultural operations per annum

1 1 1

Expenses on weed control & intercultural operations per annum (Rs)

45000 45000 45000



ha Rate (Rs)


Cost/ harvest (Rs)


Yr 1 Yr 2 Yr 3

No. of harvests/ annum (3 year crop cycle & gestation period of 3 months)

3 3 3

Expenses on harvest per annum (Rs) 72000 72000 72000



ha Rate (Rs)

Area under

crop (ha)

Cost/ operation

(Rs)

Engagement of labor for post harvest operations 40 200 3 24000

Yr 1 Yr 2 Yr 3

No. of post harvest operations/ annum 3 3 3

Expenses on post harvest operations per annum (Rs) 72000 72000 72000


Particulars Quantity Power (Kw) Total (Kw) Hrs/ day kwh/ day

3 HP Pumpset 1 2.24 2.24 1 2.24


Power requirement/ day (kwh) 5.12

Days/ annum 360

Rate per unit (Rs) 5


6.7 Salary: Expenses on salary is estimated as given below.



Helpers 3 3000 108000

Total 108000




(Rs. in lacs)



Misc. Assets 0.85 1% 0.01

Total 0.05




(Rs. in lacs)



Misc. Assets 0.85 6.23% 0.05

Total 0.18




are given below.

(Rs lakh)

Month Year 1 2 3

Month 1 Opening balance 7.17 6.37 3.19

Repayment 0.00 0.27 0.27

Interest (8%) 0.05 0.04 0.02

Closing balance 7.17 6.11 2.92


Repayment 0.00 0.27 0.27

Interest 0.05 0.04 0.02



Repayment 0.00 0.27 0.27

Interest 0.05 0.04 0.02



Repayment 0.00 0.27 0.27

Interest 0.05 0.04 0.02



Repayment 0.00 0.27 0.27

Interest 0.05 0.04 0.01



Repayment 0.00 0.27 0.27

Interest 0.05 0.03 0.01



Repayment 0.00 0.27 0.27

Interest 0.05 0.03 0.01



Repayment 0.00 0.27 0.27

Interest 0.05 0.03 0.01



Repayment 0.00 0.27 0.27

Interest 0.05 0.03 0.01



Repayment 0.27 0.27 0.27

Interest 0.05 0.03 0.01



Repayment 0.27 0.27 0.27

Interest 0.05 0.02 0.00



Repayment 0.27 0.27 0.27

Interest 0.04 0.02 0.00


Principal Repayment 0.80 3.19 3.19

Interest 0.57 0.39 0.14


(Rs. lacs)

Year 1 2 3 TOTAL

Profit After Tax (Net Profit) 4.91 3.47 3.71


Interest 0.57 0.39 0.14

Total 5.65 4.04 4.03 13.71

Interest 0.57 0.39 0.14

Loan repayment 0.80 3.19 3.19

Total 1.36 3.58 3.32 8.27

DSCR 4.14 1.13 1.21

Average DSCR = 1.66


(Rs. In lacs)

Year 1 2 3


B. Variable cost





Power 0.09 0.09 0.09





Salary 1.08 1.08 1.08






1.0 INTRODUCTION Rauvolfia root or Serpentine root (Sarpagandha) is one of the important crude drugs used in

modem medicine. Its leaves are simple, 7.5 -10cm long and 3.5 -5 cm broad. Root is prominent,

tuberous, usually branched, 0.5 to 2.6 cm diameter and upto 40 to 60 cm deep into soil. The root

bark, which constitutes 40-60% of the whole root, is rich in alkaloids known for their efficacy in

reducing high blood pressure and as a sedative or tranquilizing agent. The fresh roots emit a

characteristic acrid aroma and are very bitter in taste. The roots possess high alkaloid

concentration. Reserpine is the compound/active principle used for hypertension as a life saving

drug in allopathic system of medicine.

1.1 Habitat: It is an erect under shrubs (woody herb) and occasionally in scrub jungles and

forest clearings growing for a height of 60-90 cm. The shrub grows wild in NE region upto an

altitude of 500 m.

This project profile is for commercial cultivation of Sarpangandha with total plantation area of 1 ha.


(i) Soil & Climate: The plant grows in a wide variety of soils ranging from sandy alluvial loam to

red lateritic loam with large percentage of humus and acidic in reaction. The ideal pH for this crop

is from 4.6 — 6.5. It prefers hot humid climate, humus rich sandy loam soil. A climate with a

temperature range of 10 - 30°C seems to be well suited for this plant.

(ii) Propogation: Rauvolfia can be propagated by seed and also by vegetative means like root

cutting, root stumps, and stem cutting. Seed propagation is best method for commercial plantation.

A healthy mother stock should be raised before hand for collection of seeds.

Seed germination is highly variable. Germination of heavy seeds during April-June after soaking

them in water for 24 hours is about 20-40 % while freshly collected heavy seeds germination is

highest (upto 60 %). April-May is found to be suitable for sowing seeds in nursery. The nursery is

prepared by raised beds mixing with one-third of well matured FYM and leaf mould and two-third-

amount medium silt-loam soil under partial shade.

Seeds are sown 2-3 cm apart in rows in shallow furrows by April. The furrows are then covered

with a fine mixture of soil and FYM. The bed should be kept moist by light watering. Germination

starts after 15-20 days and continues upto 40-50 days. The nursery should be kept moist

throughout the germination period. Seedlings are ready by mid June- July for transplantation.

About 6 kg seed sown during April-May in a 500-rn2 bed will be sufficient for one-hectare area.

(iii) Planting: Transplanting the nursery grown seedlings of 40-50 days old which have 4-6

leaves (10- 2 cm tall, naked rooted or in poly bags), are planted at spacing of 30 x 30 cm.

Seedlings are carefully dugout and the taproot is cut. They are then dipped in a 0.1 % solution of

fungicide before planting to protect them against soil borne fungus causing damping off disease.

Sarpagandha takes a long duration (18 months onwards) as it is slow growing crop particularly in

the initial stage. About 80,000 - 1,00,000 number of seedlings are required/ ha as a sole crop.

Plants get established well within 25-30 days after planting.

(iv) Manure & Fertilizers: FYM @ 20-25 MT/ha should be applied during land preparation. After

planting N,P & K at the rate 10:60:30 kg/ha is applied as basal dose. Later two equal doses of N

each of 10 kg/ ha in moist soil may be applied at 50 days and 170 days after planting.

(v) Irrigation: Rouvolfia is cultivated as a rainfed crop. However, if available 4 irrigations in summer and 2 in winter at one month interval may be applied for higher yield.

(vi) Weeding & Interculture: Weeding, cleaning, hoeing twice during rains and after rains.

Flowering and fruiting starts from 6 months onward after transplanting which is irrelevant, unless there is need to collect sufficient seeds for sale or for mass multiplication. If the plant is allowed to flower and bear fruits, these markedly depress both shoot and root growth, because a significant amount of photosynthates is utilized for the production of flowers and fruits by the plants. Therefore, defloration is recommended for better root growth and yield. For seed collection an area may be earmarked.

(vii) Harvesting & Processing: The marketable roots are generally collected 2-3 years after plantation preferably after 30 months of planting. When transplanting is done during June-July harvesting period coincides with shedding of leaves during early autumn. At this stage root contains maximum concentration of total alkaloids. During harvest the roots may be found to go up to 40 cm deep in the soil. During root harvesting the thin roots are also collected. Care should be taken to keep the root bark intact as the bark constitutes 40-56 % of the whole root and has a higher alkaloid content. In general during winter months plants remain dormant, is considered ideal for harvesting.

Application of a light irrigation if possible will make digging easier. After digging, the roots are cleaned, washed and cut into I 5 cm pieces for drying and storage. The dry root possesses upto 10-12 % moisture. The dried roots are stored in polythene lined gunny bags in cool dry place to protect them from mould.

(viii) Yield: Though Rauvolfia can be propagated by various methods, maximum yield of root is obtained when the propagation is done by seeds that vary from 0.1 to 0.4 kg per plant. The average yield of Rauvolfia dry root is approximately 2000-2500 kg/ha under average management when harvested at 30 months.


The estimated project cost is given below.

( Rs. in lacs)




Misc. Assets 0.85



Transplanting of Seedlings 0.15



TOTAL 7.58




Labor quarter cum Store room (Brick wall, CGI roof, Concrete floor)

720 400 288000


TOTAL 316800


3.3 Misc. Assets: Details of miscellaneous assets are given below.



1 75000 75000


TOTAL 85000



Target area for cultivation (in ha) 1 Quantity of seeds required for sowing in 1 ha (kg) 6 Total quantity of seeds required (kg) 6 Area required for raising seedlings in sqm (500 sqm/ ha) 500 Particulars Unit Quantity Rate (Rs) Amount (Rs)

Purchase of seeds kg 6 2000 12000


Mandays/ ha

25 200 250

Engagement of labor for planting of seeds Mandays/

ha 75 200 750

Cost of FYM kg/ ha 25000 0.20 250

Sub-total 13250

Add: Maitenance for seedlings for 3 months, etc. @ 20% 2650

TOTAL 15900


3.5 Land Preparation for Nursery: Details of expenses for preparation of nursery land is given

below.

Particulars Mandays/ ha

Rate (Rs) Area under crop (ha)

Amount (Rs)



3.6 Transplanting of Seedlings: Details of expenses for transplanting of seedlings is given

below.


ha Rate (Rs)


Amount (Rs)

Engagement of labor for transplanting of seedlings

75 200 1 15000



are given below.

( Rs. in lacs)





TOTAL 0.39


( Rs. in lacs)

Amount (Rs)

Yr 1 Yr 2 Yr 3

Total operating expenses 1.44 1.38 1.74

Operating expenses capitalised for Yr 1 & Yr 2 2.82


The means of finance for the project is estimated as below.

( Rs. in lacs)


EQUITY



DEBT


TOTAL 100% 7.58


(Rs. in lacs)


A. INCOME

Yield of dry roots per annum (in kg) 0 0 22000

Price of dry roots (Rs. per kg) 80 80 80

Income from sale of oil (Rs lakh) 0.00 0.00 17.60






Power 0.09 0.09 0.09

Salary 1.08 1.09 1.10




Less: operating expenses capitalised 1.44 1.38 0.00





Expenses on nursery written off 0.05 0.05 0.05


Expenses on transplanting of seedlings written off 0.05 0.05 0.05

Net Profit -0.64 -0.64 15.25

Net cash accruels -0.36 -0.36 15.53


5.1 Estimation of Production: Yield of dry roots is estimated as below.


Yield of dry roots/ hectare kg 22000


Total yield of dry roots kg 22000

Yr 1 Yr 2 Yr 3

Schedule of harvest (Gestation period of 30 months) 0 0 1

Yield of dry roots per annum (in kg) 0 0 22000

5.2 Manures & Fertilizers: Expenses on manures & fertilizers in the 1st year is estimated as

below.

Particulars Kg/ ha

Source Nutrient

% Kg/ ha

(source)

Cost/ kg of

Source (Rs)

Cost/ ha

(Rs)


Amount (Rs)

Basal dose of Nitrogen (Year 1)

10 Urea 46% 22 5.50 120 1 120

Basal dose of Phosphorus (Year 1)

60 SSP 16% 375 4.00 1500 1 1500

Basal dose of Potassium (Year 1)

30 MOP 60% 50 12.00 600 1 600

2nd dose of Nitrogen at 50 days (Year 1)

10 Urea 0.46 22 5.5 120 1 120

3rd dose of Nitrogen at 170 days (Year 1) 10 Urea 0.46 22 5.5 120 1 120

Application of Manures during land preparation in Year 1 (25000 kg/ ha @ Rs 0.20/ kg) 5000

Expenses on manures & fertilizers during Year 1 (Rs) 7459


operations per annum is estimated as below.


ha Rate (Rs)


Cost/ annum

(Rs)


75 200 1 15000

Yr 1 Yr 2 Yr 3

Number of weed control & intercultural operations per annum

1 1 1

Expenses on weed control & intercultural operations per annum (Rs)

15000 15000 15000



ha Rate (Rs)


Cost/ harvest

(Rs)


Yr 1 Yr 2 Yr 3

Schedule of harvest (Gestation period of 30 months)

0 0 1




ha

Rate/ manday

(Rs)


Cost/ operation

(Rs)


40 200 1 8000

Yr 1 Yr 2 Yr 3

Schedule of post harvest operations 0 0 1

Expenses on post harvest operations per annum (Rs)

0 0 8000



3 HP Pumpset 1 2.24 2.24 1 2.24


Power requirement per day (kwh) 5.12

Days/ annum 360

Rate/ unit (Rs) 5


5.7 Salary: Expenses on salary is estimated as given below.


Month (Rs) Cost/

annum (Rs)


Helpers 3 3000 108000

Total 108000




(Rs. in lacs)



Misc. Assets 0.85 1% 0.01

Total 0.04




(Rs. in lacs)


annum (Rs)


Misc. Assets 0.85 6.23% 0.05

Total 0.16




are given below.

(Rs lakh)

Month Year Ending March 31 1 2 3


Repayment 0.00 0.00 0.00

Interest (8%) 0.03 0.03 0.03



Repayment 0.00 0.00 0.00

Interest 0.03 0.03 0.03



Repayment 0.00 0.00 0.00

Interest 0.03 0.03 0.03



Repayment 0.00 0.00 0.00

Interest 0.03 0.03 0.03



Repayment 0.00 0.00 0.00

Interest 0.03 0.03 0.03



Repayment 0.00 0.00 0.00

Interest 0.03 0.03 0.03



Repayment 0.00 0.00 0.00

Interest 0.03 0.03 0.03



Repayment 0.00 0.00 0.00

Interest 0.03 0.03 0.03



Repayment 0.00 0.00 0.00

Interest 0.03 0.03 0.03



Repayment 0.00 0.00 1.52

Interest 0.03 0.03 0.03



Repayment 0.00 0.00 1.52

Interest 0.03 0.03 0.02



Repayment 0.00 0.00 1.52

Interest 0.03 0.03 0.01



Interest 0.36 0.36 0.33


(Rs. lacs)

Year 1 2 3 TOTAL

Profit After Tax (Net Profit) -0.64 -0.64 15.25


Interest 0.36 0.36 0.33

Total -0.12 -0.12 15.74 15.50

Interest 0.36 0.36 0.33

Loan repayment 0.00 0.00 4.55

Total 0.36 0.36 4.88 5.61

DSCR -0.33 -0.33 3.22

Average DSCR = 2.76


(Rs. In lacs)

Year 1 2 3 Total

A. Net sales (Rs. lakh) 0.00 0.00 17.60 17.60

B. Variable cost

Manures & Fertilizers 0.07 0.00 0.00 0.07

Weed Control & Intercultural Operations 0.15 0.15 0.15 0.45

Harvesting 0.00 0.00 0.08 0.08

Post Harvest Operations 0.00 0.00 0.08 0.08

Power 0.09 0.09 0.09 0.28

Miscellaneous Expenses 0.00 0.00 0.18 0.18

Total variable cost 1.14

C. Contribution (A-B) 16.46


Salary 1.08 1.09 1.10 3.27

Repair & Maintenance 0.04 0.05 0.06 0.15

Interest on Term Loan 0.36 0.36 0.33 1.06

Depreciation 0.16 0.16 0.16 0.48

Total fixed cost 4.96

E. BREAKEVEN POINT 30%

1.0 INTRODUCTION Patchouli, an aromatic herb is distributed in the Indo Malaysian and Sino-Japanese regions. The

shade dry leaf upon steam distillation yields the Patchouli oil of commerce, which is used in

perfumery, cosmetics, processed food and is imported into India every year in large quantities. The

essential oil is one of the best fixatives for heavy perfumes, which imparts strength, strong

character, alluring notes and lasting qualities. Natural fragrances like sandalwood, rose, jasmine,

vetiver, agarwood and patchouli are complex mixtures of organic molecules, which cannot be

reproduced in the laboratory. Thus, patchouli enjoys an additional importance as aromatic oil. In

fact, it is a perfume by itself and is highly valued in perfumes, soaps, cosmetics and flavour

industries. Patchouli alcohol (C15H26) will have long-lasting fragrant aroma when blended with

other aroma chemicals.

Patchouli is native to The Philippines and grows wild and also cultivated in Malaysia, Indonesia,

Singapore, China and India. Leaves constitute the economic part, which contain the oil glands. The

plant, an erect, well-branched, pubescent, small aromatic bushy herb attains a height of about 0.5

— 1.2 m. that yields fragrant leaves containing very sweet smelling oil.

This project profile is for cultivation of Patchouli and setting up of a distilaltion unit with total area

under plant at 4 hectares.

2.0 MARKET POTENTIAL Patchouli oil is an essential ingredient and used as a ‘base’ material in perfumery industry. There is no synthetic substitute for patchouli oil, which increases its value and demand in the perfumery market. Consumption of Patchouli oil in the world is about 2000 tonnes per annum. In India due to increase in chewing tobacco and pan masala industries, consumption has gone up to about 300 tons per annum while the production is below 50 MT. Hence, the country mostly depends on import mainly from Indonesia and on reconstituted oil.


(i) Soil & Climate: The land selected for patchouli should be well-drained, loamy fertile soils, rich in organic matter. The land should not be subjected to water stagnation even for a shorter period. Heavy clay and sandy soils with poor water holding capacity are not suitable for its commercial cultivation. Acidic soil with pH value from 5.5- 6.2 is reported to be the ideal. It is advisable to avoid nematode infested areas.

Patchouli prefers warm and humid climate. The crop can be grown successfully on a fairly heavy and evenly distributed rainfall ranging from 1500 — 3000 mm per annum. A temperature of 24 —28°C and an average RH of 75 % are taken to be ideal. It grows successfully upto an altitude of 500 m above the mean sea level.

(ii) Propogation: Patchouli is propagated through stem cuttings. Terminal stem cuttings are taken from healthy mother plants growing either in open area or under light shade (less than 30 %). In cuttings obtained from crops growing in shaded area the internodes become longer with soft stem of which the survival percentage is low. Cuttings with shorter internodes are preferable.

(iii) Nursery raising: Cuttings are rooted in nursery equipped with provision of shade and water supply before planting in main field. Rooting is done either in poly bags or directly in beds under shade. Best time for rooting is during April-September. But with precautions cuttings may be rooted any time of the year. Cuttings are best rooted in poly bags, which give highest survival percentage when transplanted in the main field. When rooted directly in raised beds cuttings are planted at a spacing of 10 x 10 cm. Cuttings become ready for transplanting in about 30—45 days during April — Sept and 45 —60 days during October to March.

Cuttings are prepared in the morning or afternoon period. Apical and branch twig of 10-15 cm long with 4-5 nodes is cut away from healthy mother plants. At least two pairs fully developed lower leaves of the cuttings are stripped off before planting in rooting medium. For early rooting cut ends are dipped in IBA hormone solution of 1000-ppm strength (1 g per litre water gives 1000-ppm. This

is prepared by dissolving the hormone powder in little alcohol and then made up to volume by cold water) for 5-7 seconds and spread 10 minutes in shade for drying. Hormone powder in ready to use form like Rootex or Seradex etc available in the market in 3 grades of which the ‘No.2’ or ‘B’ grade may be used directly Hormone treatment seems to be helpful when seedlings are prepared during winter as hormone enhances root initiation.

(iv) Hardening of Seedlings: Hardening of the seedlings is necessary before planting. This is achieved by gradual reduction in water supply and removing shade from about 7-10 days ahead of planting. Before planting the poly bags are to be watered adequately. This helps rainfed crop in early establishment. Only the selected healthy seedlings of 30-45 days old should be planted.

(v) Spacing: 45 x 45 cm in raised beds in plains and 60 x 45 cm in sloppy lands.

(vi) Manure: 15-20 ton FYM or compost or well decomposed cowdung per hectare should be applied at final land preparation. If organic manure is not available in bulk, green manuring crop should be raised and incorporated in soil. During monsoon period green-manuring crops like Sesbania rostrata or Sesbania aculeata or pulses like Cowpea may be grown in between rows and at 50-60 days of growth may be uprooted and cut into pieces and applied as mulch.

(vii) Fertilizers: A fertilizer dose of 100 kg N, 50 kg P205 and 60 kg K20 per hectare is recommended. Basal application of 330 kg Single super, phosphate (SSP) and 50 kg Muriate of potash (MOP) is done at least 2 days ahead of planting. Total quantity of 220 kg urea /hectare/year in 4 equal splits should be applied. An extra dose of 30 kg K20 as top dressing along with 4th urea application may be done. It is better to avoid application of urea as basal initially. Because it will encourage weed growth and part of it will go waste as the newly planted seedlings remain unable to absorb the available N. The annual dose of NPK for subsequent years should be applied during March when there is irrigation and in May/ June without irrigation.

(viii) Cultural Practices: Compaction of surface soil particularly around root zone is avoided. This is achieved by racking with dry land weeder twice or thrice followed by one hand weeding. Forking and raking besides weeding is found to be beneficial in developing a strong root system. Incorporation of urea with soil is done by racking and hand weeding.

(ix) Irrigation: Immediately after planting light watering daily upto 3-4 days and thereafter irrigation at 10-15 days interval should be applied. Saturation of poly bags before planting in field eliminates watering for 2-3 days. Surface drainage is more important than irrigation in high rainfall plains.

(x) Harvesting: Patchouli should be harvested following selection method. In this method, a partial harvest is taken at 60-65 days after planting. At 90-100 days after planting the first regular harvesting is done by cutting selected matured branches only. Branches so selected should be about 70 — 90 days old and showing signs of maturity as 1-2 lower leaves turning yellowish. These branches bear 6-7 pairs of leaves. In 1st harvest, the main branch should be cut back above 3-4 nodes from base depending chances of regrowth. Growing buds in the lower side get suppressed and degenerated in absence of light and apical dominance if harvesting is delayed. If top portion is cut back just above the buds, the growing buds develop quickly into new branches. Harvesting of mature branches is otherwise encouraging the new shoots from lower sides of each branch. In selected harvesting (pruning) the plant is not getting enough stress and normal metabolic functions continue through out the growing period. Harvesting and other intercultural operations should be done from the side drains only without disturbing or compacting the root zones. This is necessary for quick regeneration by maintaining soil aeration. The selection of the branch for harvesting can be so planned that a few branches attain this stage at an interval of 35-45 days.

(xi) Drying of Leaves: After harvesting, the fresh herbs should be spread over on bamboo mats or on tarpaulin for drying under shade for 7-10 days. The thickness of the herb should not be more than 2 inches. Turning atleast once in a day is necessary to avoid fermentation and for uniform drying. A drying structure of 30 x 15 ft with 4 tiers racks is sufficient to cope up one-hectare area. The drying house may be constructed by bamboo with thatched roof or tarpaulin roof or may be a semi permanent structure with tiers. The fresh and dry ratio of herb is 5.5:1 at around 12 % moisture.

(xii) Crop cycle: For commercial cultivation, it is advisable to grow the crop as annual.

(xiii) Distillation of oil: Shade dried and cured leaves are subjected to steam distillation for obtaining the oil of patchouli. The distillation unit consists of a boiler, distillation still, condenser and receiver. The distillation still is made up of preferably food grade stainless steel (304 or 316). The vessel has a perforated metal sheet or net above the bottom to support the herb, which is loaded into the still for distillation. Steam is injected through perforated coils that uniformly pass through the material. This steam while pasing through takes out the oils by rupturing the oil glands that moves to condenser along with water vapour.

The condenser, which cools the hot vapours received from the still, consists of mainly tubes made up of stainless steel and mounted inside a jacket. The condenser id provided with inlet and outlet for the circulation of cooling water. The hot vapours consisting of steam and essential oil vapours are cooled in the condenser tubes and the condensate then flows out into the receiver. The oil being lighter than water and insoluble flows on the top in the receiver and only the water gets drained out. The oil is drawn off separately at the end of distillation.

The process of distillation consists of loading the dried leaves into the still, closing the lid securely, letting in steam generated in the boiler from the bottom of the still, condensing the vapours in the condenser and collecting the oil in the receiver. It has been noted that interchange of light and low pressures, i.e., 1.4 to 3.5-kg/sq cm produces better yield as more cell walls rupture in this process. The duration of distillation varies from 12- 16 hours. Prolonged distillation gives higher yield and better quality of oil.

(xiv) Yield: On an average a recovery of 3.0 to 3.5 % is obtained which varies largely on drying procedure, leave & stem ratio and curing.


(Rs. in lacs)

Particulars Amount



Plant & Machineries 3.84





TOTAL 12.59





400 300 120000


720 400 288000

Drying Shed (Open shed with CGI sheet roof) 1000 50 50000

Sub total 458000


TOTAL 503800





1 320000 320000


TOTAL 384000





1 75000 75000


TOTAL 85000



Target area for cultivation (ha) 4 Area required for raising mother stock in sqm (1/20 of target area) 2000 No. of seedlings required (40,000/ ha) 8000 Particulars Unit Qty Rate (Rs) Amount (Rs)

Purchase of seedlings Nos 8000 1 8000


Manday/ ha 25 200 1000

Engagement of labor for planting of seedlings Manday/ ha 75 200 3000

Cost of FYM kg/ ha 18000 0.20 720

Sub-total 12720

Add: Crop management for 6 months, etc. @ 20% 2544

TOTAL 15264



are given below.

(Rs. in lacs)





TOTAL 0.70


(Rs. in lacs)

Year 1 Period

(month)

Amount (Rs)

Yr 1 Yr 2 Yr 3

Preparation of Seedlings 1 0.06 0.06 0.06

Land Preparation 1 0.02 0.02 0.02

Planting 1 0.05 0.05 0.05

Manures & Fertilizers 1 0.02 0.02 0.02

Weed Control & Intercultural Operations 1 0.05 0.05 0.05

Harvesting 1 0.11 0.11 0.11

Post Harvest Operations 1 0.11 0.11 0.11

Distillation 1 0.08 0.08 0.08

Power 1 0.01 0.01 0.01

Salary 1 0.09 0.09 0.09


Receivables 1 0.86 0.86 0.86

Total 2.01 2.01 2.01



(Rs. in lacs)


EQUITY



DEBT


TOTAL 100% 12.59


(Rs. in lacs)


A. INCOME

Oil production per annum (in kg) 648 648 648 648 648

Oil price (Rs. per kg) 1600 1600 1600 1600 1600

Income from sale of oil (Rs lakh) 10.37 10.37 10.37 10.37 10.37


Preparation of Seedlings 0.77 0.77 0.77 0.77 0.77

Land Preparation 0.20 0.20 0.20 0.20 0.20

Planting 0.60 0.60 0.60 0.60 0.60

Manures & Fertilizers 0.29 0.29 0.29 0.29 0.29

Weed Control & Intercultural Operations 0.60 0.60 0.60 0.60 0.60

Harvesting 1.28 1.28 1.28 1.28 1.28

Post Harvest Operations 1.28 1.28 1.28 1.28 1.28

Distillation 0.96 0.96 0.96 0.96 0.96

Power 0.12 0.12 0.12 0.12 0.12

Salary 1.08 1.08 1.08 1.08 1.08

Repairs & Maintenance 0.10 0.11 0.12 0.13 0.14


Total operating expenses 6.61 6.62 6.63 6.64 6.66




Depreciation 0.49 0.49 0.49 0.49 0.49


Expenses on nursery written off 0.02 0.02 0.02 0.02 0.02

Net Profit 4.65 2.73 2.86 2.99 3.12



6.1 Estimation of Production: Production of oil per annum is estimated as below.


Yield of green leaves/ hectare/ harvest

kg 7500

Cultivated land under patchouli ha 4

Total yield of green leaves/ harvest kg 30000

Recovery rate of dry leaves from green leaves

% 18%

Yield of dry leaves/ harvest kg 5400

Yr 1 Yr 2 Yr 3 Yr 4 Yr 5

Number of harvests/ year (1 year crop cycle with gestation period of 3 months; subsequent harvests at 35-45 days interval)

4 4 4 4 4

Yield of dry leaves/ year (in kg) 21600 21600 21600 21600 21600

Percentage of oil recovery 3.00% 3.00% 3.00% 3.00% 3.00%

Total oil production per annum (in kg) 648 648 648 648 648

6.2 Preparation of Seedlings: Expenses on preparation of seedlings per annum is estimated as

below.

No. of seedlings required per ha 40000 Target area for cultivation 4 Total No. of seedlings required 160000 No. of polybags/ kg (4 x 3 inch size) 2000 Quantity of polybags required (in kg) 80

Particulars Unit Quantity Rate (Rs) Amount

(Rs)

Cost of polybags Kg 80 80 6400

Engagement of labor for polybag filling Mandays/ 1000 Nos

1 200 32000

Engagement of labor for planting in polybags

Mandays/ 1000 Nos

1 200 32000

Sub - Total 70400

Add: Cost for manures, etc @ 10% 7040

Annual expenses on preparation of seedlings per annum (Rs) 77440

6.3 Land Preparation: Expenses on land preparation per annum is estimated as below.


ha Rate (Rs)


Amount (Rs)


6.4 Planting: Expenses on planting per annum is estimated as below.


ha Rate (Rs)


Amount (Rs)

Engagement of labor for planting of seedlings

75 200 4 60000

6.5 Manures & Fertilizers: Expenses on manures & fertilizers per annum is estimated as below.

Particulars Kg/ ha

Source Nutrient

% Kg/ ha

(source) Cost/ kg (Source)

Cost/ ha

(Rs)


Amount (Rs)

Expenses on Manures

18000 FYM/

cowdung 100% 18000 0.20 3600 4 14400

Expenses on 100 Urea 46% 217 5.50 1196 4 4783

Nitrogen

Expenses on Phosphorus

50 SSP 16% 313 4.00 1250 4 5000

Expenses on Potassium

60 MOP 60% 100 12.00 1200 4 4800

Annual expenses on manures & fertilizers per annum (Rs) 28983




Rate (Rs)


Amount (Rs)

Engagement on labor for weed control & intercultural operations

75 200 4 60000

6.7 Harvesting: Expenses on harvesting per annum is estimated as below.


ha Rate (Rs)

Area under

crop (ha)

Amount (Rs)

Engagement of labor for harvest of leaves

40 200 4 32000


Number of harvests/ year (1 year crop cycle with gestation period of 3 months; subsequent harvests at 35-45 days interval)

4 4 4 4 4

Expenses on harvest per annum (Rs) 128000 128000 128000 128000 128000

6.8 Post Harvest Operations: Expenses on post harvest operations per annum is estimated as

below.


ha Rate (Rs)

Area under

crop (ha)

Amount (Rs)


40 200 4 32000


Number of post harvest operations/ year

4 4 4 4 4

Expenses on post harvest operations per annum

128000 128000 128000 128000 128000

6.9 Distillation: Expenses on distillation per annum is estimated as below.

No. of hours per distillation 14

Fuel (Dry herbage) consumption (kg/ hr)

15




Yield of dry leaves/ year (in kg) 21600 21600 21600 21600 21600

Capacity of distillation plant/ batch (in kg) of fresh leaves

1000 1000 1000 1000 1000

Capacity of distillation plant/ batch (in kg) of dry leaves (18% of fresh leaves)

180 180 180 180 180

No. of distillations per annum (Average)

120 120 120 120 120

Expenses on fuel (Rs) 126000 126000 126000 126000 126000

Add: engagement of labor (4 mandays/ distillation & manday cost of Rs 200)

96000 96000 96000 96000 96000

Expenses on distillation distillation per annum (Rs)

96000 96000 96000 96000 96000

6.10 Power: Expenses on power per annum is estimated as below.


3 HP Pumpset 1 2.24 2.24 1 2.24



Days/ annum 360



6.11 Salary: Expenses on salary per annum is estimated as given below.


Month (Rs) Cost/

annum (Rs)


Helpers 3 3000 108000

Total 108000




(Rs. in lacs)





Total 0.10




(Rs in lacs)

Description Cost (Rs) Rate Amount/ annum

(Rs)




TOTAL 0.49




given below.

(Rs lakh)



Repayment 0.00 0.15 0.15 0.15 0.15

Interest (8%) 0.05 0.05 0.04 0.02 0.01

Closing balance 7.55 6.96 5.18 3.41 1.63


Repayment 0.00 0.15 0.15 0.15 0.15

Interest 0.05 0.05 0.03 0.02 0.01

Closing balance 7.55 6.81 5.04 3.26 1.48


Repayment 0.00 0.15 0.15 0.15 0.15

Interest 0.05 0.05 0.03 0.02 0.01

Closing balance 7.55 6.66 4.89 3.11 1.33


Repayment 0.00 0.15 0.15 0.15 0.15

Interest 0.05 0.04 0.03 0.02 0.01

Closing balance 7.55 6.52 4.74 2.96 1.18


Repayment 0.00 0.15 0.15 0.15 0.15

Interest 0.05 0.04 0.03 0.02 0.01

Closing balance 7.55 6.37 4.59 2.81 1.04


Repayment 0.00 0.15 0.15 0.15 0.15

Interest 0.05 0.04 0.03 0.02 0.01

Closing balance 7.55 6.22 4.44 2.67 0.89


Repayment 0.00 0.15 0.15 0.15 0.15

Interest 0.05 0.04 0.03 0.02 0.01

Closing balance 7.55 6.07 4.29 2.52 0.74


Repayment 0.00 0.15 0.15 0.15 0.15

Interest 0.05 0.04 0.03 0.02 0.00

Closing balance 7.55 5.92 4.15 2.37 0.59


Repayment 0.00 0.15 0.15 0.15 0.15

Interest 0.05 0.04 0.03 0.02 0.00

Closing balance 7.55 5.78 4.00 2.22 0.44


Repayment 0.15 0.15 0.15 0.15 0.15

Interest 0.05 0.04 0.03 0.01 0.00

Closing balance 7.40 5.63 3.85 2.07 0.30


Repayment 0.15 0.15 0.15 0.15 0.15

Interest 0.05 0.04 0.03 0.01 0.00

Closing balance 7.26 5.48 3.70 1.93 0.15


Repayment 0.15 0.15 0.15 0.15 0.15

Interest 0.05 0.04 0.02 0.01 0.00

Closing balance 7.11 5.33 3.55 1.78 0.00


Interest 0.60 0.50 0.36 0.22 0.08


(Rs. In lacs)

Year ended March 31, 1 2 3 4 5 TOTAL


Depreciation 0.49 0.49 0.49 0.49 0.49

Interest 0.60 0.50 0.36 0.22 0.08

Total 5.75 3.73 3.71 3.70 3.69 20.58

Interest repayment 0.60 0.50 0.36 0.22 0.08

Loan repayment 0.44 1.78 1.78 1.78 1.78

Total 1.05 2.28 2.14 2.00 1.85 9.31

DSCR 5.50 1.63 1.74 1.85 1.99

Average DSCR = 2.21


(Rs. In lacs)

Year 1 2 3


B. Variable cost

Preparation of Seedlings 0.77 0.77 0.77

Land Preparation 0.20 0.20 0.20

Planting 0.60 0.60 0.60






Power 0.12 0.12 0.12





Salary 1.08 1.08 1.08

Repairs & Maintenance 0.10 0.11 0.12






(Rs. in lacs)

Year 0 1 2 3 4 5

CASH OUTFLOW


Working Capital 0.00 2.01 0.00 0.00 0.00 0.00

Total (A) 9.73 2.01 0.00 0.00 0.00 0.00

CASH INFLOW

Profit After Tax 4.65 2.73 2.86 2.99 3.12


Add: Interest 0.60 0.50 0.36 0.22 0.08

Add: Salvage Value

Total (B) 0.00 5.75 3.73 3.71 3.70 3.69

NET FLOW (B-A) -9.73 3.73 3.72 3.71 3.70 3.69

IRR = 26%

1.0 INTRODUCTION Lemongrass is a perennial aromatic grass. The prefix ‘lemon’ owes to its typical lemon like odour,

which is mainly due to the presence of citral, a cyclic monoterpene.

Lemongrass is the source of Lemongrass oil, a good source of natural Citral, which is used as a

basic raw material for synthesis of B-ionone used for synthesis of a number of useful aromatic

compounds and Vitamin-A. Lemongrass is thus used as a main substitute for ‘Cod liver oil’. Citral

itself is used in perfumery for various grades of soaps, detergents, cosmetics and flavour agent for

soft drinks.

In India, Lemongrass is cultivated along Western Ghats (Maharashtra, Kerala), Karnataka and

Tamil Nadu states besides the foot-hills of North East states. It was introduced in India about a

century back and is now commercially cultivated in these States.

This project profile is for cultivation of Lemongrass and setting up of a distilaltion unit with total area


2.0 MARKET POTENTIAL Lemongrass is one of most important aromatic grass which can become a crop of future India due to its application for derivatives like Vitamins which require basic molecule like Citral which is major component of this oil. Traditionally Citral was produced from Lemongrass till 60’s and India were exporting more than 1500 mt/ annum to meet demand of world market. Large scale capacities in India were operational by pharma cos. like Glaxo, Roche and Intermediates for export by Industrial perfumes.

Due to advancement in petrochemical science, Citral was derived from C-5 fractions of Petrochemical through Isoprene building block. Volume of Lemongrass and other Citral rich essential oils went down gradually as production cost increased and cheap substitutes were available in the form of synthetically derived material based on petroleum feed stock.

However, with rise in consumption of petroleum and rising prices of petroleum and petroleum based products, there is scope for production of natural Citral, particulary so, due to environmental concerns and sustainability, and people’s preference for natural products.


(i) Soil & Climate: Lemongrass flourishes in a wide variety of soils ranging from rich barns to poor laterite; also suitable to ‘jhum fallow’, hill slopes and flood free degraded land, best suited to well drain sandy loam. Water logged conditions should be avoided as they are unsuitable for its cultivation. It requires a warm humid climate with plenty of sunshine and rainfall ranging from 1800 to 3000 mm. High temperature and sunshine are conducive to the development of oil in the plant.

(ii) Preparation of root slips: It is propagated vegetatively by slips obtained from well-grown clumps. Tops of culms are cut off within 20-25 cm above ground. The culm (root portion) is divided into slips containing 2-3 tillers. The lower sheath is removed to expose young roots and the old roots are clipped off keeping the slip 25-30 cm long.

(iii) Spacing: 45 x 45 cm in plains or 60 x 45 cm in sloppy land with a requirement of slips 45,000 - 50,000/ha.

(iv) Planting: Planting is done in May-June. However, with irrigation planting can be done during any month of the year except December-January. One or two slips are planted into each hole, about 58 cm deep. It is better to plant on ridges in high rainfall areas. Slips are transplanted firmly into the ground. Plants get established well within 25-30 days after planting.

(v) Manure & fertilizer application: FYM: 10 t/ha to be applied and mixed well at the time of final land preparation. Fertilizer: N, P205 & K20-l50: 60: 60 kg/ha/year should be applied along with adequate quantity of organic matter. Before planting, the field is thoroughly prepared and the full dose of phosphorus and potash is incorporated. The nitrogen is applied in six equal split doses at two monthly intervals.

(vi) Irrigation: Irrigation is given immediately after planting when planting is done in dry days. Irrigations are given at 10 days interval to establish the crop. During dry season, after each harvest and subsequentl application of recommended fertiliser dose, one irrigation is given for optimum herb production.

(vii) Weeding & Interculture: Lemongrass has the weed suppression capacity. One hand weeding at 25-30 days followed by one hoeing at 40-60 days after planting is enough to control weeds. After each harvest a nominai weeding and earthing up of plants is beneficial for the next flush.

(viii) Harvesting: First harvest is taken at 5 months age of the crop and subsequent harvests are at 2 - 3 months intervals. Harvesting is done by cutting the grass 10 cm above the ground level. During first year 3 cuttings and subsequently 5 cuttings per year can be taken subject to weather conditions and irrigation management. Both immature and over mature crops give low yield and oil of poor quality. The optimum period of harvesting when grown on hilltop or upper slopes is 75 days while at foothill and plains it is 60 days.

(ix) Crop cycle: The crop can be maintained economically for about 4 years.

(x) Distillation of oil: The oil extracted from the wilted herb by steam distillation in stainless steel unit.The factors influencing the oil production during distillation are: (i) Storage of the plant material, (ii) Treatment (wilting and cutting into pieces) of the material and (iii) The method of distillation. The major source of loss is by oxidation and resinification of the essential oil. So if the material is to be stored before processing, it should be kept in a dry atmosphere with limited air circulation. The essential oils are present in the oil glands, oil sacks and glandular hairs of the plant. Therefore, before distillation, the day wilted plant material is cut into small pieces enable them to expose directly as many oil glands as is possible. Once the plant material has been reduced in size, it must be distilled immediately to avoid oil loss.

The wilted leaves are steam distilled which takes about 4-5 hours.

(xi) Yield: The yield of herb yield is in the range of 20 t/ha/harvest. The average oil recovery is 0.6%.


The estimated project cost is given below. (Rs. In lacs)

Particulars Amount





Setting up of a Nursery 0.17



Planting 0.60



TOTAL 12.87





400 300 120000


720 400 288000

Sub total 408000


TOTAL 448800





1 320000 320000


TOTAL 384000





1 75000 75000


TOTAL 85000




Area required for raising of mother stock in sqm (1/20 of target area) 2000

No. of slips required (50,000/ ha) 10000

Particulars Unit Quantity Rate (Rs) Amount (Rs)

Purchase of slips Nos 10000 1 10000


Mandays/ ha 25 200 1000


Mandays/ ha 75 200 3000

Cost of FYM kg/ ha 10000 0.20 400

Sub total 14400

Add: Crop managament for 6 months, etc. @ 20% 2880

TOTAL 17280



No of slips required per ha 50000




Engagement of labor for preparation of seedlings

Mandays/ 1500 Nos

1 200 26667

Add: cost of manures, etc @10% 2667

TOTAL 29333



below.



Amount (Rs)



4.8. Planting of Slips in Nursery: Details of expenses for planting of slips in nursery is given

below.



Amount (Rs)

Engagement of labor for planting of slips 75 200 4 60000

Say (Rs. in lacs 0.60

4.9 Preliminary & pre-operative expenses: Details of preliminary & pre-operative expenses

are given below.

(Rs. In lacs)




Miscellaneous Expenses 0.10

TOTAL 0.72


(Rs. In lacs)

Period (month)

Amount (Rs)

Yr 1 Yr 2 Yr 3


Weed Control & Intercultural Operations 1 0.05 0.05 0.05

Harvesting 1 0.08 0.11 0.11


Distillation 1 0.15 0.20 0.20

Power 1 0.01 0.01 0.01

Salary 1 0.09 0.09 0.09


Receivables 1 0.72 0.96 0.96

Total 1.70 2.14 2.14



The means of finance for the project is estimated as below.

(Rs. In lacs)


EQUITY



DEBT


TOTAL 100% 12.87


(Rs. in lacs)

Particulars Yr 1 Yr 2 Yr 3 Yr 4

A. INCOME

Oil production per annum (in kg) 1440 1920 1920 1920

Oil price (Rs. per kg) 600 600 600 600

Income from sale of oil 8.64 11.52 11.52 11.52


Manures & Fertilizers 0.26 0.18 0.18 0.18

Weed Control & Intercultural Operations 0.60 0.60 0.60 0.60

Harvesting 0.96 1.28 1.28 1.28

Post Harvest Operations 0.96 1.28 1.28 1.28

Distillation 1.83 2.44 2.44 2.44

Power 0.12 0.12 0.12 0.12

Salary 1.08 1.08 1.08 1.08

Repairs & Maintenance 0.09 0.10 0.11 0.12

Miscellaneous Expenses 0.09 0.12 0.12 0.12

Total Operating Expenses 5.99 7.20 7.21 7.22

Less: operating expenses capitalised 1.70 0.00 0.00 0.00

Operating profit 4.35 4.32 4.31 4.30


Depreciation 0.47 0.47 0.47 0.47

Interest on Term Loan 0.61 0.48 0.29 0.10

Expenses on nursery written off 0.04 0.04 0.04 0.04

Expenses on preparation of seedlings written off 0.07 0.07 0.07 0.07

Expenses on land preparation written off 0.05 0.05 0.05 0.05

Expenses on planting of slips written off 0.15 0.15 0.15 0.15

Net Profit 2.95 3.05 3.23 3.41

Net Cash Accruals 3.74 3.84 4.02 4.20

Principal Repayment 0.59 2.38 2.38 2.38



Yield of fresh herbs/ hectare/ harvest kg 20000

Cultivated land under lemongrass ha 4

Total yield of fresh herbs/ harvest kg 80000

Yr 1 Yr 2 Yr 3 Yr 4

Number of harvests/ year (4 year crop cycle; gestation period of 5 months; subsequent harvests at 3 months interval)

3 4 4 4

Yield of fresh herbs/ year (in kg) 240000 320000 320000 320000

Percentage of oil recovery 0.6% 0.6% 0.6% 0.6%

Total oil production per annum (in kg) 1440 1920 1920 1920


Particulars kg/ ha

Source Nutrient %

kg/ ha (Source)

Cost/ kg (Source)

Cost/ ha

(Rs)


Amount (Rs)


150 Urea 46% 326 5.50 1793 4 7174

Expenses on 60 SSP 16% 375 4.00 1500 4 6000

Phosphorus/ application


60 MOP 60% 100 12.00 1200 4 4800

Yr 1 Yr 2 Yr 3 Yr 4

Application of manures during land preparation in Year 1 (10000 kg/ ha @ Rs 0.20/ kg

8000

Application of Nitrogen/ annum 1 1 1 1

Cost (Rs) 7174 7174 7174 7174

Application of Phosphorus/ annum 1 1 1 1

Cost (Rs) 6000 6000 6000 6000

Applicaton of Potassium/ annum 1 1 1 1

Cost (Rs) 4800 4800 4800 4800

Expenses on manures & fertilizers (Rs) 25974 17974 17974 17974




Rate (Rs)


Amount (Rs)


75 200 4 60000




Amount (Rs)

Engagement of labor for harvest of herbs 40 200 4 32000

Yr 1 Yr 2 Yr 3 Yr 4

Number of harvests/ year (4 year crop cycle; gestation period of 5 months; subsequent harvests at 3 months interval)

3 4 4 4

Expenses on harvest per annum (Rs) 96000 128000 128000 128000


below.



Amount (Rs)


40 200 4 32000

Yr 1 Yr 2 Yr 3 Yr 4

Number of post harvest operations/ year 3 4 4 4


96000 128000 128000 128000


No. of hours per distillation 4.5

Fuel (dry herbage) consumption (kg/ hour) 25



Yr 1 Yr 2 Yr 3 Yr 4

Yield of fresh herbs/ year (in kg) 240000 320000 320000 320000

Capacity of distillation plant/ batch (in kg) 1000 1000 1000 1000

No. of distillations per annum (Average) 240 320 320 320

Expenses on fuel (Rs) 135000 180000 180000 180000

Add: engagement of labor (2 mandays/ 2 distillations & manday cost of Rs 200)

48000 64000 64000 64000

Expenses on distillation per annum (Rs) 183000 244000 244000 244000



3 HP Pumpset 1 2.24 2.24 1 2.24



Days/ annum 360





Month (Rs) Cost/

annum (Rs)


Helpers 3 3000 108000

Total 108000




(Rs. in lacs)





Total 0.09




(Rs in lacs)


(Rs)




TOTAL 0.47




given below.

(Rs lakh)

Month Year 1 2 3 4

Month 1 Opening balance 7.72 7.13 4.75 2.38

Repayment 0.00 0.20 0.20 0.20

Interest (8%) 0.05 0.05 0.03 0.02

Closing balance 7.72 6.93 4.55 2.18


Repayment 0.00 0.20 0.20 0.20

Interest 0.05 0.05 0.03 0.01



Repayment 0.00 0.20 0.20 0.20

Interest 0.05 0.04 0.03 0.01



Repayment 0.00 0.20 0.20 0.20

Interest 0.05 0.04 0.03 0.01



Repayment 0.00 0.20 0.20 0.20

Interest 0.05 0.04 0.03 0.01



Repayment 0.00 0.20 0.20 0.20

Interest 0.05 0.04 0.03 0.01



Repayment 0.00 0.20 0.20 0.20

Interest 0.05 0.04 0.02 0.01



Repayment 0.00 0.20 0.20 0.20

Interest 0.05 0.04 0.02 0.01



Repayment 0.00 0.20 0.20 0.20

Interest 0.05 0.04 0.02 0.01



Repayment 0.20 0.20 0.20 0.20

Interest 0.05 0.04 0.02 0.00



Repayment 0.20 0.20 0.20 0.20

Interest 0.05 0.03 0.02 0.00



Repayment 0.20 0.20 0.20 0.20

Interest 0.05 0.03 0.02 0.00


Principal Repayment 0.59 2.38 2.38 2.38

Interest 0.61 0.48 0.29 0.10


(Rs. lacs)

Year 1 2 3 4 TOTAL

Profit After Tax (Net Profit) 2.95 3.05 3.23 3.41

Depreciation 0.47 0.47 0.47 0.47

Interest 0.61 0.48 0.29 0.10

Total 4.04 4.01 4.00 3.99 16.03

Interest 0.61 0.48 0.29 0.10

Principle repayment 0.59 2.38 2.38 2.38

Total 1.21 2.86 2.67 2.48 9.21

DSCR 3.34 1.40 1.50 1.61

Average DSCR = 1.74


(Rs. In lacs)

Year 1 2 3


B. Variable cost






Power 0.12 0.12 0.12





Salary 1.08 1.08 1.08







(Rs. in lacs)

Year 0 1 2 3 4

CASH OUTFLOW

Capital Expenditure 9.18 0.00 0.00 0.00 0.00

Working Capital 0.00 1.70 0.44 0.00 0.00

Total (A) 9.18 1.70 0.44 0.00 0.00

CASH INFLOW

Profit After Tax 2.95 3.05 3.23 3.41

Add: Depreciation 0.47 0.47 0.47 0.47

Add: Interest 0.61 0.48 0.29 0.10

Add: Salvage Value

Total (B) 0.00 4.04 4.01 4.00 3.99

NET FLOW (B-A) -9.18 2.33 3.57 4.00 3.98

IRR = 17%

1.0 INTRODUCTION Citronella oil is an essential oil containing citronellal, geraniol and hydroxy citronellol and other high

value perfumery bases obtained on steam distillation of citronella grass. Citronella grass is a

perennial 1-2m tall bush with green to yellowish green leaves. The oil is used for perfuming soaps,

detergents, cosmetics, agarbattis and for making mosquito repellent creams. The oil is also used to

isolate citronellol, geraniol. These are in turn converted into citronellal, hydroxy citronellal, synthetic

menthol and esters of geraniol and citronellol. These compounds are used for making high grade

blended perfumes.

This project profile is for cultivation of citronella and setting up of a distilaltion unit with total area


2.0 MARKET POTENTIAL The major customers for citronella oil are the manufacturers of cosmetics and perfumes, with major buyers such as Hindustan Lever Limited. There has been substantial increase in the demand for essential oils due to the spurt in the growth of cosmetics & perfumes, which in turn is related with the growing purchasing power of the Indian middle class. Besides the domestic demand, there is good potential for exports. The quality of essential oils produced in Assam is reported to be better than that produced in Sri Lanka and Indonesia which are the major exporters. Citronella oil is being produced in the other north-eastern states of Meghalaya, Arunachal Pradesh, Nagaland and Manipur. Considering the incentives offered by the Government for exports, an export demand for citronella oil is bound to increase.


(i) Soil & Climate: Citronella grows well in Assam where there is abundant sunshine and high humidity (70 % and above). Temperature range between 20°C to 38°C and well distributed rainfall of 2000-3000 mm are desirable, but if irrigation is available citronella can be cultivated in regions of low rainfall also.

Citronella grows best in sandy loam soils. Heavy clayey soils, which tend to water log and light sandy soils are not suitable for this crop. It does not tolerate water stagnation. A good amount of organic matter is desirable. The ideal pH range is 5.0-7.0. Soil testing is important for best fertility management and higher productivity.

(ii) Land preparation: The land is prepared to fine tilth by discing and tilling. Organic, P and K fertilizers are mixed into the soil at this stage. In plains ridges are made at 45 cm apart. Apply at last ploughing 25-30 tons FYM or well decomposed cowdung and mixed with the soil.

(iii) Preparation of slips: Citronella is propagated by splitting the clumps of vigorously growing plant of 6-months to one year old into slips. The clump is gently dug out and separated into number of slips containing 2-3 tillers/slip. The fibrous roots and leaves are trimmed off at 25 — 30 cm height before planting. One-year-old clump on an average, gives about 50 slips.

(iv) Planting: The slips are planted at 45 x 45 cm in plain land at 5-8 cm depth on one side of the ridges, half way up the slope in plains or 60 x 45 cm in sloppy land. One slip is inserted in each pit, latter filled with loose soil and firmly pressed keeping the slip vertical. The soil moisture is maintained till the crop establishes. Casualty should be replaced within the next month. 40,000 slips are required to plant one-hectare area.

(v) Interculture: As the crop is planted during monsoon it faces serious weed competition in the initial stages and upto 60 days is found to be critical period. Generally two weedings one at 20- 25 and another at 40-45 days after planting should be done. Interculture after each harvest is necessary. In order to get satisfactory results, an integrated method that consists of hand weeding, application of weedicides and mulch should be used.

(vi) Fertilizer application: For poor and medium fertility soil N, P205, K20 @ 200:80:75 kg/ha/year should be applied. In the first year the organic, P and K fertilizers are mixed into the soil at final land preparation. Nitrogen should be applied at 4 equal splits (@ 50 kg N) in the first year- first application at about one month after planting with weeding and rests after each harvest. In

subsequent years the basal dose may be applied along with the first dose of N. N as urea is top dressed soon after the regenerated crop is established and thereafter once in every two months. In the subsequent years N dose may be increased by 50 kg for the additional split application.

(vii) Irrigation: Citronella requires sufficient moisture for good growth and yield of herb. When there is no rain, irrigation once in 10—15 days will be required.

(viii) Harvesting: It is advisable to harvest (a partial harvest) after 3 months to induce tillering, In the first year only 3 cuts besides the partial harvest can be taken, viz., 5 months after planting and 3 months after the previous harvest. From second year onwards, 5-6 harvests can be taken per year at 2 months intervals. Harvesting is done by sickle and cut at 15 cm above the ground. Cutting close to the ground results into mortality of the plant. Harvesting preferably is done before 12 O’clock.

(ix) Crop cycle: The crop can be maintained economically for about 3 years. Then it is to be pulled out and plant with rotational crop. After termination of the crop green manuring can be done.is suggested.

(x) Withering of the fresh herb: After cutting, the herb is allowed to wilt for 12-24 hours to

remove the excess moisture. This wilting allows better packing in the vessel and saving of steam

and fuel. Wilting more than 24 hours results loss of essential oil. Cutting the grass into shorter length also gives 10-15% higher recovery. The harvested grass contains dead leaves, sheaths that should be removed before packing into the vessel.

(xi) Distillation of oil: The grass is steam distilled for better recovery. The distillation equipment consists of a boiler, a distillation vessel, a condenser and two receivers / separators. The economic capacity of the unit is 1.0 ton/batch. Distillation is completed in 4-5 hours under normal pressure starting from the initial condensation of the oil. Prolong distillation deteriorates oil quality.

(xii) Yield: The yield of herb yield is in the range of 10-15 t/ha/harvest. The average oil recovery is 0.7%.



Particulars Amount








Planting 0.60



TOTAL 12.57




Distillation Shed (Open shed, CGI sheet roof, kuttcha floor)

400 300 120000

Labor quarter cum Store room (Brick wall, CGI roof, concrete floor)

720 400 288000

Sub total 408000


TOTAL 448800





1 320000 320000


TOTAL 384000





1 75000 75000


TOTAL 85000



Target area for cultivation (in ha) 4 Area required for raising of mother stock in sqm (1/20 of target area) 2000

No. of slips required (50,000/ha) 10000 Particulars Unit Quantity Rate (Rs) Amount (Rs)

Purchase of slips Nos 10000 1 10000


Mandays/ ha 25 200 1000


Mandays/ ha 75 200 3000

Cost of FYM kg/ ha 25000 0.20 1000

Sub total 15000

Add: Maintenance of seedlings for 6 months, etc. @ 20% 3000

TOTAL 18000



No of slips required per ha 50000




Engagement of labor for preparation of seedlings

Mandays/ 1500 Nos

1 200 26667

Add: cost of manures, etc @10% 2667

TOTAL 29333



below.



Amount (Rs)



4.8. Planting of Slips in Nursery: Details of expenses for planting of slips in nursery is given

below.



Amount (Rs)

Engagement of labor for planting of slips 75 200 4 60000

Say (Rs. in lacs 0.60


are given below.

(Rs. In lacs)





TOTAL 0.56


(Rs. In lacs)

Period

(Months) Amount (Rs)

Yr 1 Yr 2 Yr 3


Weed control & Intercultural Operations

1 0.05 0.05 0.05

Harvesting 1 0.08 0.13 0.13


Distillation Cost 1 0.09 0.15 0.15

Power 1 0.01 0.01 0.01

Salary 1 0.09 0.09 0.09


Receivables 1 0.67 1.12 1.12

Total 1.56 2.32 2.32





EQUITY



DEBT


TOTAL 100% 12.57


(Rs. in lacs)


A. INCOME

Oil production per annum (in kg) 1008 1680 1680

Oil price (Rs. per kg) 800 800 800

Income from sale of oil 8.06 13.44 13.44







Power 0.12 0.12 0.12

Salary 1.08 1.08 1.08

Repairs & Maintenance 0.09 0.10 0.11



Less: Working expenses capitalised 1.56 0.00 0.00





Expenses on nursery written off 0.06 0.06 0.06

Expenses on preparation of seedlings written off 0.10 0.10 0.10


Expenses on planting of slips written off 0.20 0.20 0.20

Net Profit 2.70 4.83 5.08

Net cash accruels 3.60 5.72 5.98




Yield of fresh herbs/ hectare/ harvest kg 12000

Cultivated land under citronella ha 4

Total yield of fresh herbs/ harvest kg 48000

Yr 1 Yr 2 Yr 3

Number of harvests/ year (3 year crop cycle with gestation period of 5 months; subsequent harvests at 2 months interval)

3 5 5

Yield of fresh herbs/ year (in kg) 144000 240000 240000

Percentage of oil recovery 0.7% 0.7% 0.7%

Total oil production per annum (in kg) 1008 1680 1680


Particulars kg/ ha

Source Nutrient %

kg/ ha (source)

Cost/ kg of

source (Rs)

Cost/ ha

(Rs)


Amount (Rs)


200 Urea 46% 435 5.50 2391 4 9565

Expenses on Phosphorus/ application

80 SSP 16% 500 4.00 2000 4 8000


75 MOP 60% 125 12.00 1500 4 6000

Yr 1 Yr 2 Yr 3


20000

Application of Nitrogen/ annum 1 1 1

Cost (Rs) 9565 9565 9565

Application of Phosphorus/ annum 1 1 1

Cost (Rs) 8000 8000 8000

Application Potassium/ annum 1 1 1

Cost (Rs) 6000 6000 6000

Expenses on manures & fertilizers per annum (Rs) 43565 23565 23565




Rate (Rs)


Amount (Rs)


75 200 4 60000



Rate (Rs) Area under

crop (ha)

Amount (Rs)

Engagement of labor for harvest of herbs 40 200 4 32000

Yr 1 Yr 2 Yr 3 Number of harvests/ year (3 year crop cycle

with gestation period of 5 months; subsequent harvests at 2 months interval)

3 5 5



below.


Rate (Rs) Area under

crop (ha)

Amount (Rs)


25 200 4 32000

Yr 1 Yr 2 Yr 3 Number of post harvest operations/ year 3 5 5


96000 160000 160000


No. of hours per distillation 4.5

Fuel (Dry herbage) consumption (kg/ hour) 25



Yr 1 Yr 2 Yr 3

Yield of fresh herbs/ year (in kg) 144000 240000 240000

Capacity of distillation plant/ batch (in kg) 1000 1000 1000

No. of distillations per annum (Average) 144 240 240

Expense on fuel (Rs) 81000 135000 135000

Add: engagement of labor (2 mandays/ 2 distillations & manday cost of Rs 200)

28800 48000 48000

Expenses on distillation per annum (Rs) 109800 183000 183000



3 HP Pumpset 1 2.24 2.24 1 2.24



Days/ annum 360





Month (Rs) Cost/

annum (Rs)


Helpers 3 3000 108000

Total 108000




(Rs. in lacs)





Total 0.09




(Rs in lacs)


(Rs)




TOTAL 0.47




given below.

(Rs in lakh)

Month Year 1 2 3


Repayment 0.00 0.28 0.28

Interest (8%) 0.05 0.04 0.02



Repayment 0.00 0.28 0.28

Interest 0.05 0.04 0.02



Repayment 0.00 0.28 0.28

Interest 0.05 0.04 0.02



Repayment 0.00 0.28 0.28

Interest 0.05 0.04 0.02



Repayment 0.00 0.28 0.28

Interest 0.05 0.04 0.01



Repayment 0.00 0.28 0.28

Interest 0.05 0.04 0.01



Repayment 0.00 0.28 0.28

Interest 0.05 0.03 0.01



Repayment 0.00 0.28 0.28

Interest 0.05 0.03 0.01



Repayment 0.00 0.28 0.28

Interest 0.05 0.03 0.01



Repayment 0.28 0.28 0.28

Interest 0.05 0.03 0.01



Repayment 0.28 0.28 0.28

Interest 0.05 0.03 0.00



Repayment 0.28 0.28 0.28

Interest 0.05 0.02 0.00



Interest 0.60 0.41 0.15


(Rs. in lacs)

Year 1 2 3 TOTAL

Profit After Tax (Net Profit) 2.70 4.83 5.08


Interest 0.60 0.41 0.15

Total 3.77 5.71 5.70 15.19

Interest 0.60 0.41 0.15


Total 1.44 3.77 3.50 8.70

DSCR 2.63 1.52 1.63

Average DSCR = 1.75


(Rs. in lacs)

Year 1 2 3


B. Variable cost





Distillation Cost 1.10 1.83 1.83

Power 0.12 0.12 0.12





Salary 1.08 1.08 1.08







(Rs. in lacs)

Year 0 1 2 3

CASH OUTFLOW

Capital Expenditure 9.36 0.00 0.00 0.00

Working Capital 0.00 1.56 0.76 0.00

Total (A) 9.36 1.56 0.76 0.00

CASH INFLOW

Profit After Tax 2.70 4.83 5.08

Add: Depreciation 0.47 0.47 0.47

Add: Interest 0.60 0.41 0.15

Add: Salvage Value

Total (B) 0.00 3.77 5.71 5.70

NET FLOW (B-A) -9.36 2.21 4.96 5.70

IRR = 15%

1.0 INTRODUCTION Hotel industry is inextricably linked to the tourism industry and the growth in tourism industry fuels

the growth in hotel business. Demand for hotel rooms also increases during times of boom in the

economy, due to the increase in business travellers. In India, the Ministry of Tourism is the

regulatory authority for categorisation of hotels, the purpose of which is to provide contemporary

standards of facilities and services available in the hotels and thereby contribute in the overall

tourism experience.

Under the regulatory regime, the hotels in India ae classified as below. 1. Star Category Hotels: 5 Star Deluxe, 4 Star, 3 Star, 2 Star, 1 Star. 2. Heritage Category Hotels: Heritage Grand, Heritage Classic & Heritage Basic

This project profile is for setting up of a 2 Star Hotel with accomodation capacity of 24 rooms.

2.0 MARKET POTENTIAL The hotel industry in India has witnessed significant growth over the past few years and the

demand has been constantly increasing due to various factors. CARE research estimates the hotel

industry in India to grow at a compounded annual growth rate. Buoyancy in economy, rising

discretionary income, growing culture of weekend vacation and increased business travel are likely

to propel growth in the hotel industry. Domestic leisure tourists will continue to dominate the

domestic demand for hotel rooms in the low, economy and medium segment, whereas the rise in

foreign tourist arrivals and business travelers will create demand for upper segement.

When compared with the potential for tourism in the NE region, the number of tourist visiting the

region is far below the actual potential. The tourist flow to the region witnessed a fluctuating trend

over the years though this has changed for the better with attempts to position the NER for its wide

biodiversity. As per one study report, the the hotel industry in the North East is growing at the rate

of more than 100%. Due to exponential increase in commercial activities and associated business

travellers, the demand for hotel accommodation is increasing. The report favours the setting up of

a few more 2, 3, 4 and 5 star category hotels.



(Rs. in lacs)




Equipments 45.14





TOTAL 216.27


Particulars Area Rate (Rs) Amount (Rs)

Earth filling, leveling, fencing, gate, boundary wall, drain, etc

LS LS 500000




Basement 140 15000 2100000

Ground Floor 140 9000 1260000

First Floor 165 10000 1650000

Second Floor 165 10000 1650000

Third Floor 165 10000 1650000

Fourth Floor 165 10000 1650000

Sub total 9960000


TOTAL 11155200




Lift (Ordinary) 1 800000 800000

TV 25 15000 375000

AC 25 25000 625000

Geyser 25 7000 175000

Ceiling fans 30 1000 30000

Water cooler 2 35000 70000

Refrigerator 10 12000 120000

Room furnishing 21 35000 735000

Reception/ lobby furnishing LS LS 500000

Kitchen & restaurant equipments LS LS 500000


Sub total 4030000


TOTAL 4513600




100 KVA DG Set 1 575000 575000

Transformer installation 1 800000 800000

EPABX system 1 60000 60000

Computers 5 25000 125000

Printer 1 15000 15000

Fire safety equipments 1 90000 90000

Shallow tube well 1 200000 200000


Sub total 1965000


TOTAL 2065000



are given below.

(Rs. In lacs)






TOTAL 20.95


cost of land & site development, building & civil works, equipments and miscellaneous fixed

assets.


(Rs. in lacs)


Amount


Food & Provisions 30 5.18 6.48 7.78

Power & Fuel 30 1.09 1.37 1.64

Salary 30 1.22 1.22 1.23

Total 7.50 9.07 10.64





EQUITY



DEBT


TOTAL 100% 216.27


(Rs. in lacs)


A. INCOME

Income at installed capacity (Rs lakhs)

309.52 309.52 309.52 309.52 309.52 309.52 309.52




Food & Provisions 63.07 78.84 94.61 94.61 94.61 94.61 94.61

Power & Fuel 13.30 16.62 19.94 19.94 19.94 19.94 19.94

Salary 14.88 14.89 14.91 14.92 14.94 14.95 14.97


Administrative & Selling Expenses 1.24 1.55 1.86 1.86 1.86 1.86 1.86




7.50 0.00 0.00 0.00 0.00 0.00 0.00



Depreciation 7.42 7.42 7.42 7.42 7.42 7.42 7.42


Net Profit 11.55 17.19 31.17 33.75 36.30 38.83 41.33




A. Income from Rooms

Type of Rooms Quantity Tariff (Rs) Days Amount (Rs)

Economy 15 1200 365 6570000

Deluxe 7 1800 365 4599000

Suite 2 2500 365 1825000


B. Income from Restaurant

Particulars Rate/ client (Rs) Clients/ day Days/ annum Amount (Rs)

Fooding per day 600 48 365 10512000

Tea, snacks, etc per day 300 48 365 5256000


C. Income from Conference Hall

Days/ annum 365

Rate (Rs) 5000

Income from conference hall at installed capacity (Rs) 1825000

D. Other incomes like telephone

Days/ annum 365

Income per day (Rs) 1000

Income from telephone calls, etc at installed capacity (Rs) 365000

Total Income at installed capacity (Rs) 30952000


from restaurant.

5.3 Power & Fuel: Expenses on power & fuel is estimated as below.



AC for restaurant. rooms & hall 1 50.00 50.00 12 600.00

General Lighting, TV, fans, etc 47 0.80 37.60 12 451.20

Lift, computers, etc 1 10.00 10.00 10 100.00

Water pump 1 5.00 5.00 2 10.00

Miscellsneous 1.00 12 12.00


Average load 70%

Days/ annum 365




Hrs/ day 2


Days/ annum 365







General Manager 1 30000 360000

Managers 2 15000 360000

Receptionist 2 7000 168000

Housekeepers 2 5000 120000

Waiters 5 5000 300000






(Rs. in lacs)






5.6 Administrative & Selling Expenses: Administrative & selling expenses have been assumed

at 1% of sales.




(Rs in lacs)



Equipments 45.14 5.28% 2.38


TOTAL 7.42




given below.

(Rs in lakh)

Year 1 2 3 4 5 6 7


Repayment 0.00 1.73 1.73 1.73 1.73 1.73 1.73

Interest (13.5%) 1.46 1.40 1.17 0.93 0.70 0.47 0.23

Closing balance 129.76 122.84 102.08 81.32 60.55 39.79 19.03


Repayment 0.00 1.73 1.73 1.73 1.73 1.73 1.73

Interest 1.46 1.38 1.15 0.91 0.68 0.45 0.21

Closing balance 129.76 121.11 100.35 79.59 58.82 38.06 17.30


Repayment 0.00 1.73 1.73 1.73 1.73 1.73 1.73

Interest 1.46 1.36 1.13 0.90 0.66 0.43 0.19

Closing balance 129.76 119.38 98.62 77.86 57.09 36.33 15.57


Repayment 0.00 1.73 1.73 1.73 1.73 1.73 1.73

Interest 1.46 1.34 1.11 0.88 0.64 0.41 0.18

Closing balance 129.76 117.65 96.89 76.13 55.36 34.60 13.84


Repayment 0.00 1.73 1.73 1.73 1.73 1.73 1.73

Interest 1.46 1.32 1.09 0.86 0.62 0.39 0.16

Closing balance 129.76 115.92 95.16 74.40 53.63 32.87 12.11


Repayment 0.00 1.73 1.73 1.73 1.73 1.73 1.73

Interest 1.46 1.30 1.07 0.84 0.60 0.37 0.14

Closing balance 129.76 114.19 93.43 72.67 51.90 31.14 10.38


Repayment 0.00 1.73 1.73 1.73 1.73 1.73 1.73

Interest 1.46 1.28 1.05 0.82 0.58 0.35 0.12

Closing balance 129.76 112.46 91.70 70.94 50.17 29.41 8.65


Repayment 0.00 1.73 1.73 1.73 1.73 1.73 1.73

Interest 1.46 1.27 1.03 0.80 0.56 0.33 0.10

Closing balance 129.76 110.73 89.97 69.21 48.44 27.68 6.92


Repayment 0.00 1.73 1.73 1.73 1.73 1.73 1.73

Interest 1.46 1.25 1.01 0.78 0.54 0.31 0.08

Closing balance 129.76 109.00 88.24 67.48 46.71 25.95 5.19


Repayment 1.73 1.73 1.73 1.73 1.73 1.73 1.73

Interest 1.46 1.23 0.99 0.76 0.53 0.29 0.06

Closing balance 128.03 107.27 86.51 65.75 44.98 24.22 3.46


Repayment 1.73 1.73 1.73 1.73 1.73 1.73 1.73

Interest 1.44 1.21 0.97 0.74 0.51 0.27 0.04

Closing balance 126.30 105.54 84.78 64.02 43.25 22.49 1.73


Repayment 1.73 1.73 1.73 1.73 1.73 1.73 1.73

Interest 1.42 1.19 0.95 0.72 0.49 0.25 0.02

Closing balance 124.57 103.81 83.05 62.28 41.52 20.76 0.00


Interest 17.46 15.53 12.73 9.93 7.12 4.32 1.52


(Rs. in lacs)

Year 1 2 3 4 5 6 7 TOTAL


Depreciation 7.42 7.42 7.42 7.42 7.42 7.42 7.42

Interest 17.46 15.53 12.73 9.93 7.12 4.32 1.52

Total 36.43 40.13 51.32 51.09 50.84 50.57 50.26 330.64

Interest 17.46 15.53 12.73 9.93 7.12 4.32 1.52

Loan repayment 5.19 20.76 20.76 20.76 20.76 20.76 20.76

Total 22.65 36.29 33.49 30.69 27.89 25.08 22.28 198.37

DSCR 1.61 1.11 1.53 1.66 1.82 2.02 2.26

Average DSCR = 1.67


(Rs. in lacs)

Year 1 2 3


B. Variable cost

Food & Provisions 63.07 78.84 94.61

Power & Fuel 13.30 16.62 19.94

Administrative & Selling Expenses 1.24 1.55 1.86





Salary 14.88 14.89 14.91







G. Cash BEP 29.93% 28.41% 26.14%


(Rs. in lacs)

Year 0 1 2 3 4 5 6 7

CASH OUTFLOW


Working Capital 0.00 7.50 1.57 1.57 0.00 0.00 0.00 0.00

Total (A) 182.34 7.50 1.57 1.57 0.00 0.00 0.00 0.00

CASH INFLOW

Profit After Tax 11.55 17.19 31.17 33.75 36.30 38.83 41.33


Add: Interest 17.46 15.53 12.73 9.93 7.12 4.32 1.52

Add: Salvage Value

Total (B) 0.00 36.43 40.13 51.32 51.09 50.84 50.57 50.26

NET FLOW (B-A) -182.34 28.93 38.56 49.75 51.09 50.84 50.57 50.26

IRR = 15%

1.0 INTRODUCTION Hotel industry is inextricably linked to the tourism industry and the growth in tourism industry fuels

the growth in hotel business. Demand for hotel rooms also increases during times of boom in the

economy, due to the increase in business travellers. In India, the Ministry of Tourism is the

regulatory authority for categorisation of hotels, the purpose of which is to provide contemporary

standards of facilities and services available in the hotels and thereby contribute in the overall

tourism experience.

Under the regulatory regime, the hotels in India ae classified as below. 1. Star Category Hotels: 5 Star Deluxe, 4 Star, 3 Star, 2 Star, 1 Star. 2. Heritage Category Hotels: Heritage Grand, Heritage Classic & Heritage Basic

This project profile is for setting up of a 3 Star Hotel with accomodation capacity of 35 rooms. In

addition, the hotel will provide services of Conference Hall, Banquet Hall, Multi cuisine restaurant &

bar and spa & salon.

2.0 MARKET POTENTIAL The hotel industry in India has witnessed significant growth over the past few years and the

demand has been constantly increasing due to various factors. CARE research estimates the hotel

industry in India to grow at a compounded annual growth rate. Buoyancy in economy, rising

discretionary income, growing culture of weekend vacation and increased business travel are likely

to propel growth in the hotel industry. Domestic leisure tourists will continue to dominate the

domestic demand for hotel rooms in the low, economy and medium segment, whereas the rise in

foreign tourist arrivals and business travelers will create demand for upper segement.

When compared with the potential for tourism in the NE region, the number of tourist visiting the

region is far below the actual potential. The tourist flow to the region witnessed a fluctuating trend

over the years though this has changed for the better with attempts to position the NER for its wide

biodiversity. As per one study report, the the hotel industry in the North East is growing at the rate

of more than 100%. Due to exponential increase in commercial activities and associated business

travellers, the demand for hotel accommodation is increasing. The report favours the setting up of

a few more 2, 3, 4 and 5 star category hotels.



(Rs. in lacs)




Equipments 71.18





TOTAL 463.08


Particulars Area Rate (Rs) Amount (Rs)

Earth filling, leveling, fencing, gate, boundary wall, drain, etc

LS LS 500000




Basement 580 9000 5220000

Ground Floor 580 9000 5220000

First Floor 580 9000 5220000

Second Floor 580 9000 5220000

Third Floor 580 9000 5220000

Sub total 26100000


TOTAL 29232000




Lift (Ordinary) 1 800000 800000

TV 40 15000 600000

AC 45 25000 1125000

Geyser 35 7000 245000

Ceiling fans 45 1000 45000

Water cooler 2 35000 70000

Refrigerator 10 12000 120000

Room furnishing 35 50000 1750000

Reception/ lobby furnishing LS LS 500000

Kitchen & restaurant equipments LS LS 500000

Laundry equipments LS LS 300000

Spa & Saloon equipments LS LS 200000


Sub total 6355000


TOTAL 7117600




125 KVA DG Set 1 889000 889000

Transformer installation 1 800000 800000

EPABX system 1 60000 60000

Computers 5 25000 125000

Printer 1 15000 15000

Fire safety equipments 1 90000 90000

Shallow tube well 1 200000 200000


Sub total 2279000


TOTAL 2379000



are given below.

(Rs. In lacs)






TOTAL 46.34


cost of land & site development, building & civil works, equipments and miscellaneous fixed

assets.


(Rs. in lacs)


Amount


Food & Provisions 30 8.82 11.34 13.86

Power & Fuel 30 0.91 1.17 1.44

Salary 30 2.95 2.95 2.95

Total 12.68 15.47 18.25





EQUITY



DEBT


TOTAL 100% 463.08


(Rs. in lacs)


A. INCOME

Income at installed capacity (Rs lakhs)

651.53 651.53 651.53 651.53 651.53 651.53 651.53




Food & Provisions 107.31 137.97 168.63 168.63 168.63 168.63 168.63

Power & Fuel 11.12 14.29 17.47 17.47 17.47 17.47 17.47

Salary 35.88 35.92 35.95 35.99 36.02 36.06 36.10


Administrative & Selling Expenses

2.28 2.93 3.58 3.58 3.58 3.58 3.58




12.68 0.00 0.00 0.00 0.00 0.00 0.00



Depreciation 15.03 15.03 15.03 15.03 15.03 15.03 15.03


Net Profit 26.70 48.06 83.94 89.44 94.89 100.29 105.63




A. Income from Rooms

Type of Rooms Quantity Tariff (Rs) Days Amount (Rs)

Standard 20 2000 365 14600000

Deluxe 13 2500 365 11862500

Suite 2 3500 365 2555000


B. Income from Restaurant

Particulars Rate/ client (Rs) Clients/ day Days/ annum Amount (Rs)

Fooding per day 800 70 365 20440000

Tea, snacks, etc per day 400 70 365 10220000


C. Income from Conference Hall & Banquet Hall

Days/ annum 365

Rate (Rs) 10000

Income from conference hall at installed capacity (Rs) 3650000

D. Other incomes like Spa & Saloon, telephone, laundry, etc

Days/ annum 365

Income per day (Rs) 5000

Income from telephone calls, etc at installed capacity (Rs) 1825000

Total Income at installed capacity (Rs) 65152500


from restaurant.

5.3 Power & Fuel: Expenses on power & fuel is estimated as below.



AC for restaurant. rooms & hall 1 50.00 50.00 12 600.00

General Lighting, TV, fans, etc 35 0.80 28.00 12 336.00

Lift, computers, etc 1 10.00 10.00 10 100.00

Water pump 1 5.00 5.00 2 10.00

Miscellaneous 1.00 12 12.00


Average load 70%

Days/ annum 365




Hrs/ day 2


Days/ annum 365







General Manager 1 50000 600000

Managers 3 20000 720000

Acccounts Officer 1 20000 240000

Receptionist 3 15000 540000

Spa & Saloon staffs 5 8000 480000

Housekeepers 2 8000 192000

Waiters 6 8000 576000






(Rs. in lacs)






5.6 Administrative & Selling Expenses: Administrative & selling expenses have been assumed

at 1% of sales.




(Rs in lacs)



Equipments 71.18 5.28% 3.76


TOTAL 15.03




given below.

(Rs in lakh)

Year 1 2 3 4 5 6 7


Repayment 0.00 3.70 3.70 3.70 3.70 3.70 3.70

Interest (13.5%) 3.13 3.00 2.50 2.00 1.50 1.00 0.50

Closing balance 277.85 263.03 218.58 174.12 129.66 85.21 40.75


Repayment 0.00 3.70 3.70 3.70 3.70 3.70 3.70

Interest 3.13 2.96 2.46 1.96 1.46 0.96 0.46

Closing balance 277.85 259.33 214.87 170.42 125.96 81.50 37.05


Repayment 0.00 3.70 3.70 3.70 3.70 3.70 3.70

Interest 3.13 2.92 2.42 1.92 1.42 0.92 0.42

Closing balance 277.85 255.62 211.17 166.71 122.25 77.80 33.34


Repayment 0.00 3.70 3.70 3.70 3.70 3.70 3.70

Interest 3.13 2.88 2.38 1.88 1.38 0.88 0.38

Closing balance 277.85 251.92 207.46 163.01 118.55 74.09 29.64


Repayment 0.00 3.70 3.70 3.70 3.70 3.70 3.70

Interest 3.13 2.83 2.33 1.83 1.33 0.83 0.33

Closing balance 277.85 248.21 203.76 159.30 114.85 70.39 25.93


Repayment 0.00 3.70 3.70 3.70 3.70 3.70 3.70

Interest 3.13 2.79 2.29 1.79 1.29 0.79 0.29

Closing balance 277.85 244.51 200.05 155.60 111.14 66.68 22.23


Repayment 0.00 3.70 3.70 3.70 3.70 3.70 3.70

Interest 3.13 2.75 2.25 1.75 1.25 0.75 0.25

Closing balance 277.85 240.80 196.35 151.89 107.44 62.98 18.52


Repayment 0.00 3.70 3.70 3.70 3.70 3.70 3.70

Interest 3.13 2.71 2.21 1.71 1.21 0.71 0.21

Closing balance 277.85 237.10 192.64 148.19 103.73 59.27 14.82


Repayment 0.00 3.70 3.70 3.70 3.70 3.70 3.70

Interest 3.13 2.67 2.17 1.67 1.17 0.67 0.17

Closing balance 277.85 233.39 188.94 144.48 100.03 55.57 11.11


Repayment 3.70 3.70 3.70 3.70 3.70 3.70 3.70

Interest 3.13 2.63 2.13 1.63 1.13 0.63 0.13

Closing balance 274.15 229.69 185.23 140.78 96.32 51.87 7.41


Repayment 3.70 3.70 3.70 3.70 3.70 3.70 3.70

Interest 3.08 2.58 2.08 1.58 1.08 0.58 0.08

Closing balance 270.44 225.99 181.53 137.07 92.62 48.16 3.70


Repayment 3.70 3.70 3.70 3.70 3.70 3.70 3.70

Interest 3.04 2.54 2.04 1.54 1.04 0.54 0.04

Closing balance 266.74 222.28 177.82 133.37 88.91 44.46 0.00


Interest 37.38 33.26 27.26 21.26 15.25 9.25 3.25


(Rs. in lacs)

Year 1 2 3 4 5 6 7 TOTAL


Depreciation 15.03 15.03 15.03 15.03 15.03 15.03 15.03

Interest 37.38 33.26 27.26 21.26 15.25 9.25 3.25

Total 79.12 96.35 126.22 125.72 125.17 124.57 123.91 801.05

Interest 37.38 33.26 27.26 21.26 15.25 9.25 3.25

Loan repayment 11.11 44.46 44.46 44.46 44.46 44.46 44.46

Total 48.50 77.71 71.71 65.71 59.71 53.71 47.71 424.76

DSCR 1.63 1.24 1.76 1.91 2.10 2.32 2.60

Average DSCR = 1.89


(Rs. in lacs)

Year 1 2 3


B. Variable cost

Food & Provisions 107.31 137.97 168.63

Power & Fuel 11.12 14.29 17.47

Administrative & Selling Expenses 2.28 2.93 3.58





Salary 35.88 35.92 35.95







G. Cash BEP 25.43% 24.21% 22.38%


(Rs. in lacs)

Year 0 1 2 3 4 5 6 7

CASH OUTFLOW


Working Capital 0.00 12.68 2.78 2.78 0.00 0.00 0.00 0.00

Total (A) 392.29 12.68 2.78 2.78 0.00 0.00 0.00 0.00

CASH INFLOW

Profit After Tax 26.70 48.06 83.94 89.44 94.89 100.29 105.63


Add: Interest 37.38 33.26 27.26 21.26 15.25 9.25 3.25

Add: Salvage Value

Total (B) 0.00 79.12 96.35 126.22 125.72 125.17 124.57 123.91

NET FLOW (B-A) -392.29 66.43 93.56 123.44 125.72 125.17 124.57 123.91

IRR = 19%

1.0 INTRODUCTION Bakery is a traditional activity and occupies an important place in food processing industry. Despite

the advebnt of fully automatic and semi-automatic bread and biscuit making plants, a sizeable

number of people still prefer fresh bread and other products from bakery. Bread and biscuit

consumption is more in cities and towns where industrial working group population is more. They

are also being increasingly used for various feeding programmes managed by voluntary agencies

and government departments.

This project profile is for setting up of Bakery for manufacturing of bread and biscuits with installed

production capacity of 240 kg of bread and 25 kg of biscuits per day.

2.0 MARKET POTENTIAL India produces more than 80 million tonnes of wheat. Most of it is used for direct consumption in

the form of chapati & bakery products. The per capita consumption of bakery products in India is

about 2 kg per annum, against 50-100 kg bread alone in western countries. Consumption of bread

and biscuits is increasing at estimated rate of 135% with a scope for further enhancement. The

manufacture of bread and biscuits in small towns and villages will meet the local demands as the

consumers are complelled to buy branded ones sourced from outside in absence of fresh products

which are made locally.

3.0 MANUFACTURING PROCESS

3.1 Bread: The production process of bread is as follows. (i) Sifting of flour (ii) Preparation of suspension (iii) Preparation of dough by kneading all the ingredients (iv) Fermentation of dough (v) Baking (vi) Cooling and packing.

3.2 Biscuit: The production process of biscuit is as follows (i) Mixing of ingredients except flour in required proportion in paste form

(ii) Preparation of dough by mixing with flour

(iii) Placing dough in biscuit moulding and cutting machine

(iv) Baking

(v) Cooling and packing.











TOTAL 10.62

4.1 Land & Site Development: No cost has been considered for land & site development. It is assumed that the project will be set up in own land.



Factory Building (Half brick wall, CGI sheet roof, Concrete Floor)

80 4500 360000

Add: Electrification, water supply, etc @ 12% 43200

TOTAL 403200




Dough Kneader 1

275000 275000

Flour Sifter 1

Hand Dividers 4

Oven 1

Baby boiler 1

Moulds & Dies

Weighing Scale 1

Mixing Vessels 4

Miscellaneous items


TOTAL 302500




Power connection (20 HP) 1 150000 150000



Sub total 160000


TOTAL 168000



are given below.

(Rs. in lacs)






TOTAL 0.59


cost of building & civil works, machinery & equipments and miscellaneous fixed assets.


(Rs. in lacs)

Period (Days)

Amount (Rs)



Power 30 0.06 0.07 0.08

Salary 30 0.22 0.22 0.22

Receivables 15 0.40 0.47 0.53

Total 1.02 1.16 1.29





EQUITY



DEBT


TOTAL 100% 10.62


(Rs. in lacs)


A. INCOME

Installed capacity (Nos/ annum)

(a) Bread 180000 180000 180000 180000 180000

(b) Biscuit 30000 30000 30000 30000 30000


Production at capacity utilisation

(a) Bread 108000 126000 144000 144000 144000

(b) Biscuit 18000 21000 24000 24000 24000

Price (Rs/ packet)

(a) Bread 6 6 6 6 6

(b) Biscuit 18 18 18 18 18

Income from sales/ annum (Rs lakh) 9.72 11.34 12.96 12.96 12.96



Power 0.75 0.88 1.00 1.00 1.00

Salary 2.70 2.71 2.73 2.74 2.75





Less: Working expenses capitalised 1.02 0.00 0.00 0.00 0.00



Depreciation 0.40 0.40 0.40 0.40 0.40


Net Profit 2.00 1.82 2.70 2.79 2.88



6.1 Production Capacity: Total production of bread and biscuit at installed capacity is estimated

as below.

Rated plant capacity (per day)

(a) Bread (kg) 240

(b) Biscuit (kg) 25

Weight of each packaged product

(a) Bread (kg) 0.40

(b) Biscuit (kg) 0.25

Production/ day

(a) Bread (Nos) 600

(b) Biscuit (Nos) 100

Days/ annum 300

Total production per annum at installed capacity (No. of packets)

(a) Bread (Nos) 180000

(b) Biscuit (Nos) 30000

6.2 Raw Materials & Consumables: Expenses on raw materials & consumables at installed

capacity utilization is estimated as below.

Particulars Qty (Tonnes) Rate (Rs) Amount (Rs)

Flour 52 8000 416000

Yeast 0.8 22000 17600

Sugar 3.3 17000 56100

Ghee 2.5 45000 112500

Milk Powder 0.2 80000 16000

Salt 1.2 4000 4800

Total 623000

Add: Packing materials, consumables, etc @ 10% 62300



Connected load (kw) 14.92

Avg. load factor 70%

Hrs/ day 8

Days/ annum 300

Annual power consumption (kwh) 25066






Manager (Self) - - -


Helpers 5 2500 150000





(Rs. in lacs)






6.6 Selling Expenses: Selling expenses has been assumed at 1% of sales.




(Rs in lacs)


annum (Rs)




TOTAL 0.40




given below.

(Rs in lakh)



Repayment 0.00 0.12 0.12 0.12 0.12

Interest (8%) 0.04 0.04 0.03 0.02 0.01

Closing balance 6.37 5.87 4.37 2.87 1.37


Repayment 0.00 0.12 0.12 0.12 0.12

Interest 0.04 0.04 0.03 0.02 0.01

Closing balance 6.37 5.75 4.25 2.75 1.25


Repayment 0.00 0.12 0.12 0.12 0.12

Interest 0.04 0.04 0.03 0.02 0.01

Closing balance 6.37 5.62 4.12 2.62 1.12


Repayment 0.00 0.12 0.12 0.12 0.12

Interest 0.04 0.04 0.03 0.02 0.01

Closing balance 6.37 5.50 4.00 2.50 1.00


Repayment 0.00 0.12 0.12 0.12 0.12

Interest 0.04 0.04 0.03 0.02 0.01

Closing balance 6.37 5.37 3.87 2.37 0.87


Repayment 0.00 0.12 0.12 0.12 0.12

Interest 0.04 0.04 0.03 0.02 0.01

Closing balance 6.37 5.25 3.75 2.25 0.75


Repayment 0.00 0.12 0.12 0.12 0.12

Interest 0.04 0.03 0.02 0.01 0.00

Closing balance 6.37 5.12 3.62 2.12 0.62


Repayment 0.00 0.12 0.12 0.12 0.12

Interest 0.04 0.03 0.02 0.01 0.00

Closing balance 6.37 5.00 3.50 2.00 0.50


Repayment 0.00 0.12 0.12 0.12 0.12

Interest 0.04 0.03 0.02 0.01 0.00

Closing balance 6.37 4.87 3.37 1.87 0.37


Repayment 0.12 0.12 0.12 0.12 0.12

Interest 0.04 0.03 0.02 0.01 0.00

Closing balance 6.25 4.75 3.25 1.75 0.25


Repayment 0.12 0.12 0.12 0.12 0.12

Interest 0.04 0.03 0.02 0.01 0.00

Closing balance 6.12 4.62 3.12 1.62 0.12


Repayment 0.12 0.12 0.12 0.12 0.12

Interest 0.04 0.03 0.02 0.01 0.00

Closing balance 6.00 4.50 3.00 1.50 0.00


Interest 0.51 0.42 0.30 0.18 0.06


(Rs. in lacs)



Depreciation 0.40 0.40 0.40 0.40 0.40

Interest 0.51 0.42 0.30 0.18 0.06

Total 2.91 2.64 3.40 3.37 3.34 15.66

Interest 0.51 0.42 0.30 0.18 0.06

Loan repayment 0.37 1.50 1.50 1.50 1.50

Total 0.88 1.92 1.80 1.68 1.56 7.86

DSCR 3.29 1.37 1.89 2.00 2.14

Average DSCR = 1.99


(Rs. in lacs)

Year 1 2 3


B. Variable cost


Power 0.75 0.88 1.00






Salary 2.70 2.71 2.73







G. Cash BEP 42.46% 41.74% 40.56%


(Rs. in lacs)

Year 0 1 2 3 4 5

CASH OUTFLOW


Working Capital 0.00 1.02 0.13 0.13 0.00 0.00

Total (A) 9.00 1.02 0.13 0.13 0.00 0.00

CASH INFLOW

Profit After Tax 2.00 1.82 2.70 2.79 2.88


Add: Interest 0.51 0.42 0.30 0.18 0.06

Add: Salvage Value

Total (B) 0.00 2.91 2.64 3.40 3.37 3.34

NET FLOW (B-A) -9.00 1.88 2.51 3.27 3.37 3.34

IRR = 16%

1.0 INTRODUCTION Fresh noodles are an extruded product made of tapioca flour and maida. They are long thread-like

of 0.22 to 0.4 mm thickness. This is an eatable food item under instant food products and very

popular now-a-days as break fast food. It is one of the most conventional foods available in the

market. Noodles is the term being used to designate products made from blend of flours, the major

component of which is tapioca flour and maida. A noodle is manufactured in different sizes, hollow

as well as solid, for different cooking methods. Some are made for cooking and others are for

frying.

This project profile is for setting up of a unit for making noodles for frying, with installed processing

capacity 200 kg per day.

2.0 MARKET POTENTIAL Noodles and chowmein are very popular in developed countries and now it has created good

market potential in our country also and is becoming a popular item. The factors governing its

demand are:

(a) Rapid industrialization in the country.

(b) Increase in the purchasing capacity of the people.

(c) Change in people’s eating habits especially the younger generation.

(d) It is ready-to-eat product.

(e) Convenience of preparation.

Keeping in view the above factors, the demand of this product is likely to increase manifold in the

coming years.

3.0 MANUFACTURING PROCESS The process of manufacturing of noodles is described as below.

(a) Dry Mixing: The three ingredients, viz, maida, starch and soda bicarbonate is blended in a vertical mixer alongwith edible colour.

(b) Dough Formation: Satisfactory dough can be made from the above blend only by using boiled water, when a part of the starch is gelatinized. The ingredients are mixed in dough mixer for about 12 to 15 minutes.

(c) Extrusion: The kneaded dough is then transferred to noodles making machine where extruded material of desired shape and length is obtained by using an appropriate type of die and suitably adjusting the distance between the dye surface and cutting blade. The moisture content of the product at this stage is about 33%.

(d) Pre-drying: The cut noodles from the cutting machine fall on wooden trays. The product undergoes surface drying and becomes sufficiently hard enough to be handled without sticking or being crushed. The moisture content of the pre-dried product is about 29.5%.

(e) Drying: The pre-dried product is finally semi dried. The moisture content of the product will be 17%. Drying is done by exposure to indirect sunrays or placing in shade. The noodles dried as above do not have a satisfactory cooking quality and undergo a heavy loss on cooking. This can be reduced considerably by giving heat treatment to the product. This is optional as this gives a brown colour to the product, which may not be appealing to some of the customers.

Sometimes the product is exposed to steam. The steamed product has three advantages: (i) longer shelf-life (ii) harder grain, and (iii) better eating quality than unsteamed product. Steaming is done by exposing the product in thin layer to steam for about 15 minutes. The steamed and subsequently dried product has a moisture content of about 10%. The steaming is done before the product is semi-dried.


The estimated project cost is given below:

(Rs. in lacs)









TOTAL 14.77

4.1 Land & Site Development: No cost has been considered for land & site development. It is assumed that the project will be set up in own land.



Workshed cum Store Room (Brick wall, CGI roof, Concrete floor)

100 5500 550000


TOTAL 605000




Powder Mixer 1 25000 25000

Dough Mixer 1 50000 50000

Noodles Making Machine 1 250000 250000


Sub-total 345000

Add: Transportation, taxes, etc @ 20% 69000

TOTAL 414000




Power connection (30 HP) 1 100000 100000

Water supply system (STW boring, 3 HP pump set, storage, pipes & fittings)

1 80000 80000



TOTAL 200000



are given below.

(Rs. in lacs)






TOTAL 0.76




(Rs. in lacs)

Period (Days)

Amount (Rs)



Power 30 0.08 0.09 0.11

Salary 30 0.33 0.33 0.33


Receivables 7 0.29 0.35 0.40

Total 1.46 1.65 1.85





EQUITY



DEBT


TOTAL 100% 14.77


(Rs. in lacs)


A. INCOME

Installed capacity (kg/ annum) 60000 60000 60000 60000 60000


Production at capacity utilisation 30000 36000 42000 42000 42000

Price (Rs/ kg) 50 50 50 50 50




Power 0.94 1.13 1.32 1.32 1.32

Salary 3.96 3.98 4.00 4.02 4.04








Depreciation 0.55 0.55 0.55 0.55 0.55


Net Profit 2.58 2.50 3.93 4.06 4.18



6.1 Production Capacity: Total production of noodles at installed capacity is estimated as

below.

Rated processing capacity/ day (kg) 200

Days/ annum 300

Total production of noodles at installed capacity (kg) 60000



Particulars Composition Quantity (kg) Rate (Rs) Amount (Rs)

Maida 50% 30000 20 600000

Starch 44% 26400 25 660000

Sodium Bicarbonate, salt, etc 6% 3600 20 72000

Total 1332000

Add: Packing materials, etc @ 10% 133200



Connected load (kw) 22

Avg. load factor 70%

Hrs/ day 8

Days/ annum 300

Annual power consumption (kwh) 37598







Machine operators/ skilled workers 3 6000 216000

Helpers 5 3000 180000





(Rs. in lacs)










(Rs in lacs)





TOTAL 0.55




given below.

(Rs in lakh)



Repayment 0.00 0.17 0.17 0.17 0.17

Interest (8%) 0.06 0.06 0.04 0.03 0.01

Closing balance 8.86 8.17 6.08 4.00 1.91


Repayment 0.00 0.17 0.17 0.17 0.17

Interest 0.06 0.05 0.04 0.03 0.01

Closing balance 8.86 8.00 5.91 3.82 1.74


Repayment 0.00 0.17 0.17 0.17 0.17

Interest 0.06 0.05 0.04 0.03 0.01

Closing balance 8.86 7.82 5.74 3.65 1.56


Repayment 0.00 0.17 0.17 0.17 0.17

Interest 0.06 0.05 0.04 0.02 0.01

Closing balance 8.86 7.65 5.56 3.48 1.39


Repayment 0.00 0.17 0.17 0.17 0.17

Interest 0.06 0.05 0.04 0.02 0.01

Closing balance 8.86 7.47 5.39 3.30 1.22


Repayment 0.00 0.17 0.17 0.17 0.17

Interest 0.06 0.05 0.04 0.02 0.01

Closing balance 8.86 7.30 5.21 3.13 1.04


Repayment 0.00 0.17 0.17 0.17 0.17

Interest 0.06 0.05 0.03 0.02 0.01

Closing balance 8.86 7.13 5.04 2.95 0.87


Repayment 0.00 0.17 0.17 0.17 0.17

Interest 0.06 0.05 0.03 0.02 0.01

Closing balance 8.86 6.95 4.87 2.78 0.70


Repayment 0.00 0.17 0.17 0.17 0.17

Interest 0.06 0.05 0.03 0.02 0.00

Closing balance 8.86 6.78 4.69 2.61 0.52


Repayment 0.17 0.17 0.17 0.17 0.17

Interest 0.06 0.05 0.03 0.02 0.00

Closing balance 8.69 6.60 4.52 2.43 0.35


Repayment 0.17 0.17 0.17 0.17 0.17

Interest 0.06 0.04 0.03 0.02 0.00

Closing balance 8.52 6.43 4.35 2.26 0.17


Repayment 0.17 0.17 0.17 0.17 0.17

Interest 0.06 0.04 0.03 0.02 0.00

Closing balance 8.34 6.26 4.17 2.09 0.00


Interest 0.71 0.59 0.42 0.26 0.09


(Rs. in lacs)



Depreciation 0.55 0.55 0.55 0.55 0.55

Interest 0.71 0.59 0.42 0.26 0.09

Total 3.83 3.64 4.90 4.86 4.82 22.06

Interest 0.71 0.59 0.42 0.26 0.09

Loan repayment 0.52 2.09 2.09 2.09 2.09

Total 1.23 2.68 2.51 2.34 2.18 10.93

DSCR 3.12 1.36 1.95 2.08 2.21

Average DSCR = 2.02


(Rs. in lacs)

Year 1 2 3


B. Variable cost


Power 0.94 1.13 1.32






Salary 3.96 3.98 4.00







G. Cash BEP 37.17% 36.58% 35.59%


(Rs. in lacs)

Year 0 1 2 3 4 5

CASH OUTFLOW


Working Capital 0.00 1.46 0.20 0.20 0.00 0.00

Total (A) 12.56 1.46 0.20 0.20 0.00 0.00

CASH INFLOW

Profit After Tax 2.58 2.50 3.93 4.06 4.18


Add: Interest 0.71 0.59 0.42 0.26 0.09

Add: Salvage Value

Total (B) 0.00 3.83 3.64 4.90 4.86 4.82

NET FLOW (B-A) -12.56 2.38 3.45 4.71 4.86 4.82

IRR = 16%

1.0 INTRODUCTION The water available from untreated sources such as Well, Boreholes and Spring is generally not

hygienic and safe for drinking. Thus it is desirable and necessary to purify the water and supply

under hygienic conditions for human drinking purpose.

As the name implies, mineral water is the purified water fortified with requisite amounts of minerals

such as Barium, Iron, Manganese, etc. which can be absorbed by human body. It is either obtained

from natural resources like spring and drilled wells or it is fortified artificially by blending and

treating with mineral salts. The mineral water is manufactured and packed under hygienic

conditions in properly washed and cleaned bottles in sterilised conditions. These are then sold to

consumers as packaged water.

This project profile is for production of packaged drinking water with Reverse Osmosis water

treatment system and having integrated PET Blowing system for manufacturing of pet bottles and

jars. The processing capacity of the plant is 5000 litres per hour.

2.0 MARKET POTENTIAL The Indian market for packaged drinking water is estimated at about Rs 1,000 Crore and is

growing at a whopping rate of 40 per cent.

According to a national-level study, there are more than 200 bottled water brands in India and

among them, nearly 80 per cent are local brands. In fact, making bottled water is today a cottage

industry in the country. Leave alone the metros, where a bottled-water manufacturer can be found

even in a one-room shop, in every medium and small city and even in some prosperous rural areas

there are bottled water manufacturers.

While India ranks in the top 10 largest bottled water consumers in the world, it’s per capita per

annum consumption of bottled water is estimated to be five litres, which is comparatively lower

than the global average of 24 litres. Today it is one of India's fastest growing industrial sectors.

Between 1999 and 2004, the Indian bottled water market grew at a compound annual growth rate

(CAGR) of 25 per cent - the highest in the world. The total annual bottled water consumption in

India had tripled to 5 billion liters in 2004 from 1.5 billion liters in 1999. Global consumption of

bottled water was nearing 200 billion liters in 2006.

3.0 MANUFACTURING PROCESS Raw water stored in Storage Tanks is treated through the following process.

(i) Multi graded sand filter: To remove suspended matter.

(ii) Activated carbon filter: To remove suspended matter from the water.

(iii) Antiscalant Dosing System: To prevent scale deposition from desalting element, by means of Antiscalant Dosing in raw water.

(iv) Ultraviolet Disinfection System: To remove biological impurities from the raw water.

(v) Micron Filtration: To remove micron particles from the raw water.

(vi) Osmotic pressure System (High Pressure Pump): To create osmotic pressure in raw

water.

(vii) Desalination System by Reverse Osmosis Membrane Element: To desalt the raw water

i.e. to reduce total dissolve solids.

(viii) Ion Controlling System: To adjust the minerals contains in the Process water by means of

mixing of raw water in the desalted Treated water, Due to proportionate mixing Required

quantity of raw water, we can mix to get required Quantity of ions from the raw water to

desalted water.

(ix) Storage of Treated Water: To remove back pressure in R. O. Membrane elements.

(x) Fine Polishing Filtration: To filter water from 2 micron to 0.2 micron rating & achieve the

crystal clear filtered mineral water.

(xi) UV system: To kill the bacteria from fine water.

(xii) Ozonization: To Prevent the biological & micro organism growth in the stagnant water.

(xiii) Rinsing Filling & Capping with Lable shrinking M/c: To rinse, fill & capping of the bottle of

mineral water.

(xiv) Bottle Manufacturing Machine: To manufacture the PET bottle from Pet granules.

(xv) Reverse Osmosis Membrane Cleaning System: To clean the membrane when it comes in

maintenance stage.

(xvi) Packing of mineral water in Bottles, container or polypack: To pack the final production

in the selected packing to sell it in the market.





Building & Civil works 25.14






TOTAL 196.72

4.1 Land & Site Development: Details of land & site development are given below.


Site levelling, approach road, boundary fencing, etc.

4000 100 400000




Factory Building including laboratory, store room, etc (Single storeyed RCC building)

250 8500 2125000

Genset Room (Brick wall, CGI sheet roof, Concrete Floor)

30 4000 120000

Sub total 2245000


TOTAL 2514400




Water Treatment Plant with R.O system UV sterlization system, capacity 5000 ltr/hr, with all accessories

1 2275000 2275000

Other equipments (Ozone Generator, Storage Tanks, Pump, Pipe Fittings, Batch Coding Machine & laboratory equipments)

1 1860000 1860000

Automatic Filling Machine complete with accessories

1 4450000 4450000

Pet Blowing System complete with accessories 1 1359000 1359000


Sub total 10044000


TOTAL 11148400




Installation of deep bore tubewell 1 1500000 1500000

62.5 KVA DG Set 1 385000 385000



Sub total 2035000


TOTAL 2136750




fixed assets.


are given below.

(Rs. In lacs)






TOTAL 15.90


(Rs. in lacs)

Period (Days)

Amount (Rs)


Consumables 30 12.94 15.53 18.11

Power & fuel 30 0.38 0.45 0.53

Salary 30 1.68 1.69 1.69

Finished Goods 15 9.17 10.81 12.45

Receivables 15 10.78 12.94 15.09

Total 34.94 41.41 47.88





EQUITY



DEBT


TOTAL 100% 196.72


(Rs. in lacs)


A. INCOME

Production capacity (litres/ annum) in lakhs

102.89 102.89 102.89 102.89 102.89 102.89 102.89




Raw Materials & Consumables 157.41 188.90 220.38 220.38 220.38 220.38 220.38

Power & Fuel 4.59 5.51 6.42 6.42 6.42 6.42 6.42

Salary 20.40 20.50 20.60 20.71 20.81 20.92 21.02


Franchise Fee 26.24 31.48 36.73 36.73 36.73 36.73 36.73

Selling & Administrative Expenses 7.87 9.44 11.02 11.02 11.02 11.02 11.02



Less: Working expenses capitalised

13.98 0.00 0.00 0.00 0.00 0.00 0.00



Depreciation 8.08 8.08 8.08 8.08 8.08 8.08 8.08


Interest on Working Capital Loan 3.35 3.98 4.60 4.60 4.60 4.60 4.60

Net Profit 25.62 24.77 39.35 41.83 44.30 46.77 49.24



6.1 Production Capacity: Total production of packaged water at 100% capacity utilization is

estimated as below.

Rated plant capacity (litres/ hr of treated water) 5000

No. of hrs/ day 8


Total quantity (litres) 12000000

Less: 5% towards forced outage 600000

Less: 5% towards auxillary consumption 570000

Less: Loss during transit @ 5% 541500

Total production per annum at 100% capacity (litres) 10288500

6.2 Income from Sales: Total income from sales at 100% capacity utilization is estimated as

below.

Product Proportion ltrs/ annum Qty/ year Rate (Rs) Amount (Rs)

A. Pet Bottles 50% 5144250

i. 500 ml 40% 2057700 4115400 5 20577000

ii. 1 litre 40% 2057700 2057700 8 16461600

iii. 2 litres 20% 1028850 514425 10 5144250

B. Water Jars (20 litres) 50% 5144250 257213 40 10288500

Income from sales at 100% capacity (Rs) 52471350

6.3 Raw Materials & Consumables: Total expenses on raw materials & consumables at 100%

capacity utilization are estimated as below.

Particulars Qty/ year Rate (Rs) Amount (Rs)

Cost of preform

i. 500 ml 4115400 3.15 12963510

ii. 1 litre 2057700 3.65 7510605

iii. 2 litres 514425 4.35 2237749

iv. Water jars (Refill stock) 10289 140.00 1440390

Caps (Water jars) 10289 2.50 25721

Caps (Pet bottles) 6687525 0.50 3343763

Label print for pet bottles 6687525 0.35 2340634

Heat shrink seal for pet bottles 6687525 0.15 1003129

Total 30865500

Add: Packing materials, chemicals, etc @ 2% 617310

Expenses on consumables at 100% capacity (Rs) 31482810

6.4 Power & Fuel: Total expenses on power & fuel at 100% capacity utilization is estimated as

below.


Particulars Quantity Power (Kw) Total (Kw) Hrs/ day kwh

Plant & machinery 1 85.00 85.00 8 680

General Lighting 14 0.10 1.40 8 11

Total power requirement/ day (Kwh) 691


Average load factor 70%



Expenses on power (Rs) 725760


Hours/ day 8

Diesel consumption (litres per hours) 8


Proportion running on diesel 20%




6.5 Salary: Total expenses on salary in the 1st year are estimated as given below. It is assumed



Manager 1 15000 180000



Semi skilled workers/ administrative staff 5 5000 300000



6.6 Repair & Maintenance: Total expenses on repair & maintenance in the 1st year is estimated

as given below. It is assumed that expenses on repair & maintenance will increase @ 3%


(Rs. in lacs)






6.7 Franchisee Fee: Franchisee fee has been assumed at 10% of sales realisation.

6.8 Selling & Administrative Expenses: Selling & administrative expenses have been assumed

at 3% of sales.




(Rs in lacs)





TOTAL 8.08

6.11 Interest on Term Loan & Principal Repayment: Interest rate has been assumed at

13.75%. Duration of Loan repayment has been considered for a period of 7 years including


given below.

(Rs in lakh)

Month Year 1 2 3 4 5 6 7


Repayment 0.00 1.64 1.64 1.64 1.64 1.64 1.64

Interest (13.75%) 1.35 1.35 1.13 0.90 0.68 0.45 0.23

Closing balance 118.03 116.39 96.72 77.05 57.38 37.71 18.03


Repayment 0.00 1.64 1.64 1.64 1.64 1.64 1.64

Interest 1.35 1.33 1.11 0.88 0.66 0.43 0.21

Closing balance 118.03 114.75 95.08 75.41 55.74 36.07 16.39


Repayment 0.00 1.64 1.64 1.64 1.64 1.64 1.64

Interest 1.35 1.31 1.09 0.86 0.64 0.41 0.19

Closing balance 118.03 113.12 93.44 73.77 54.10 34.43 14.75


Repayment 0.00 1.64 1.64 1.64 1.64 1.64 1.64

Interest 1.35 1.30 1.07 0.85 0.62 0.39 0.17

Closing balance 118.03 111.48 91.80 72.13 52.46 32.79 13.11


Repayment 0.00 1.64 1.64 1.64 1.64 1.64 1.64

Interest 1.35 1.28 1.05 0.83 0.60 0.38 0.15

Closing balance 118.03 109.84 90.16 70.49 50.82 31.15 11.48


Repayment 0.00 1.64 1.64 1.64 1.64 1.64 1.64

Interest 1.35 1.26 1.03 0.81 0.58 0.36 0.13

Closing balance 118.03 108.20 88.53 68.85 49.18 29.51 9.84


Repayment 0.00 1.64 1.64 1.64 1.64 1.64 1.64

Interest 1.35 1.24 1.01 0.79 0.56 0.34 0.11

Closing balance 118.03 106.56 86.89 67.21 47.54 27.87 8.20


Repayment 0.00 1.64 1.64 1.64 1.64 1.64 1.64

Interest 1.35 1.22 1.00 0.77 0.54 0.32 0.09

Closing balance 118.03 104.92 85.25 65.57 45.90 26.23 6.56


Repayment 0.00 1.64 1.64 1.64 1.64 1.64 1.64

Interest 1.35 1.20 0.98 0.75 0.53 0.30 0.08

Closing balance 118.03 103.28 83.61 63.93 44.26 24.59 4.92


Repayment 0.00 1.64 1.64 1.64 1.64 1.64 1.64

Interest 1.35 1.18 0.96 0.73 0.51 0.28 0.06

Closing balance 118.03 101.64 81.97 62.30 42.62 22.95 3.28


Repayment 0.00 1.64 1.64 1.64 1.64 1.64 1.64

Interest 1.35 1.16 0.94 0.71 0.49 0.26 0.04

Closing balance 118.03 100.00 80.33 60.66 40.98 21.31 1.64


Repayment 0.00 1.64 1.64 1.64 1.64 1.64 1.64

Interest 1.35 1.15 0.92 0.70 0.47 0.24 0.02

Closing balance 118.03 98.36 78.69 59.02 39.34 19.67 0.00


Interest 16.23 14.99 12.28 9.58 6.88 4.17 1.47



(Rs. in lacs)



Bank Loan (60%) 20.96 24.85 28.73

Interest @ 16% 3.35 3.98 4.60


(Rs. in lacs)

Year 1 2 3 4 5 6 7 TOTAL


Depreciation 8.08 8.08 8.08 8.08 8.08 8.08 8.08

Interest 16.23 14.99 12.28 9.58 6.88 4.17 1.47

Total 49.93 47.84 59.72 59.49 59.26 59.02 58.78 394.04

Interest 16.23 14.99 12.28 9.58 6.88 4.17 1.47

Loan repayment 0.00 19.67 19.67 19.67 19.67 19.67 19.67

Total 16.23 34.66 31.96 29.25 26.55 23.84 21.14 183.63

DSCR 3.08 1.38 1.87 2.03 2.23 2.48 2.78

Average DSCR = 2.15


(Rs. in lacs)

Year 1 2 3


B. Variable cost


Power & Fuel 4.59 5.51 6.42

Franchise Fee @ 10% of income 26.24 31.48 36.73

Selling & Administrative Expenses @ 3% of income 7.87 9.44 11.02






Salary 20.40 20.50 20.60







G. Cash BEP 33.64% 32.77% 30.70%


(Rs. in lacs)

Year 0 1 2 3 4 5 6 7

CASH OUTFLOW


Working Capital 0.00 34.94 6.47 6.47 0.00 0.00 0.00 0.00

Total (A) 161.99 34.94 6.47 6.47 0.00 0.00 0.00 0.00

CASH INFLOW

Profit After Tax 25.62 24.77 39.35 41.83 44.30 46.77 49.24


Add: Interest 16.23 14.99 12.28 9.58 6.88 4.17 1.47

Add: Salvage Value

Total (B) 0.00 49.93 47.84 59.72 59.49 59.26 59.02 58.78

NET FLOW (B-A) -161.99 14.99 41.37 53.25 59.49 59.26 59.02 58.78

IRR = 20%

1.0 INTRODUCTION Computers have changed complete global scenario of work and business. Today computers are

widely used in every aspect of life. The computer software is divided into two groups, viz, System

Software and Application Software. The system software is used for application development. The

application software operates and interfaces with the system software. Application software has

wide scope for development than system software.

Application software falls into two general categories - horizontal applications and vertical

applications. Horizontal applications are the most popular and widespread in departments or

companies. Vertical applications are niche products, designed for a particular type of business or

division in a company.

1.1 Application software classification

There are many types of application software:

An application suite consists of multiple applications bundled together. They usually have

related functions, features and user interfaces, and may be able to interact with each other, e.g.

open each other's files. Business applications often come in suites, e.g. Microsoft Office, which

bundle together a word processor, a spreadsheet, etc.; but suites exist for other purposes, e.g.

graphics or music.

Enterprise software addresses the needs of organization processes and data flow, often in a

large distributed environment. (Examples include customer relationship management (CRM)

systems and supply chain management software).

Enterprise infrastructure software provides common capabilities needed to support enterprise

software systems. (Examples include email servers, and systems for managing networks and

security.)

Information worker software lets users create and manage information, often for individual

projects within a department, in contrast to enterprise management. Examples include resource

management and documentation tools. Word processors, spreadsheets, email and blog clients,

personal information system, and individual media editors may aid in multiple information worker

tasks.

Content access software is used primarily to access content without editing, but may include

software that allows for content editing. Such software addresses the needs of individuals and

groups to consume digital entertainment and published digital content. (Examples include media

players and web browsers).

Educational software is related to content access software, but has the content and/or

features adapted for use in by educators or students. For example, it may deliver evaluations

(tests), track progress through material, or include collaborative capabilities.

Simulation software simulates physical or abstract systems for research, training or

entertainment purposes.

Media development software generates print and electronic media for others to consume,

most often in a commercial or educational setting. This includes graphic-art software, desktop

publishing software, multimedia development software, HTML editors, digital-animation editors,

digital audio and video composition, and many others.

Product engineering software is used in developing hardware and software products. This

includes computer-aided design (CAD), computer language editing and compiling tools, etc.

http://en.wikipedia.org/wiki/Vertical_application

http://en.wikipedia.org/wiki/Vertical_application

http://en.wikipedia.org/wiki/Niche_product

http://en.wikipedia.org/wiki/Application_suite

http://en.wikipedia.org/wiki/Business_software

http://en.wikipedia.org/wiki/Microsoft_Office

http://en.wikipedia.org/wiki/Enterprise_software

http://en.wikipedia.org/wiki/Supply_chain_management_software

http://en.wikipedia.org/wiki/Software_systems

http://en.wikipedia.org/wiki/Information_worker

http://en.wikipedia.org/wiki/Media_player_(application_software)

http://en.wikipedia.org/wiki/Media_player_(application_software)

http://en.wikipedia.org/wiki/Web_browser

http://en.wikipedia.org/wiki/Educational_software

http://en.wikipedia.org/wiki/Simulation_software

http://en.wikipedia.org/wiki/Media_development

http://en.wikipedia.org/wiki/Computer-aided_design

The widely used application softwares are word processors, spreadsheets and databases. Word

processors are now used in all modern offices as a tool for written communications. Software like

spreadsheets has simplified the task of budgeting, financial analysis, forecasting, etc. The

database software has revolutionsed the data management of storing, organising and retrieving

information from large source of data.

This project profile is for setting up of a Computer Training Institute for offering courses in common

application softwares like word processors, spreadsheets, database management, etc with intake

capacity of 15 students per batch.

2.0 MARKET POTENTIAL Information processing has become one of the most significant industries in the world in recent

years. In view of its tremendous potentialities for information processing, data management,

design, production, management and other applications in business and offices, there is a growing

need for trained work force in this area. As such, there is potential for setting up training centres to

imapart such skills.






Equipments 8.53





TOTAL 11.46

3.1 Land & Site Development: No cost has been considered for land & site development. It is assumed that the unit will be set up on a leased premise.

3.2 Building & Civil Works: The unit will be set up on a leased premise. Details of renovation

works, etc is given below.


Renovation of premise 100 1000 100000


TOTAL 110000




Computer (Administrative) 2 35000 70000

Computer (Student Terminals) 15 35000 525000

Online UPS (2 kva) 1 20000 20000

Overhead Projector 1 40000 40000

Laser Printer 1 15000 15000

Computer Table & Chair 15 3000 45000

Softwares LS LS 50000


Sub-total 775000

Add: Transportation, installation, etc @ 10% 77500

TOTAL 852500





Electricity & phone connection LS LS 20000


TOTAL 50000



are given below.

(Rs. in lacs)






TOTAL 0.47


cost of building & civil works, equipments and miscellaneous fixed assets.


(Rs. in lacs)

Period (Days)

Amount (Rs)


Consumables 30 0.02 0.02 0.02

Power 30 0.02 0.02 0.03

Lease Rent 30 0.10 0.10 0.10

Salary 30 0.41 0.42 0.42

Total 0.55 0.56 0.56





EQUITY



DEBT


TOTAL 100% 11.46


(Rs. in lacs)


A. INCOME

Intake capacity (No. of enrollments/ annum) 120 120 120 120 120


Total enrollment at capacity utilisation 72 84 96 96 96

Fee (Rs/ student) 12000 12000 12000 12000 12000

Income from fees/ annum (Rs lakh) 8.64 10.08 11.52 11.52 11.52


Consumables 0.19 0.22 0.25 0.25 0.25

Power 0.24 0.28 0.32 0.32 0.32

Lease Rent 1.20 1.20 1.20 1.20 1.20

Salary 5.04 5.07 5.09 5.12 5.14








Depreciation 0.52 0.52 0.52 0.52 0.52


Net Profit 1.14 1.98 3.41 3.49 3.57



5.1 Intake Capacity: Total enrollment of students at installed capacity is estimated as below.

No. of students per batch (Nos) 15

Duration per batch (hrs) 2

Hrs per day 8

Course duration (days) 150

Days per annum 300

Total enrollment per annum at installed capacity (Nos) 120

5.2 Consumables: Expenses on consumables at installed capacity is estimated as below.

Particulars Unit Qty/ annum Rate (Rs) Total (Kw)

Papers Bundles 20 300 6000

Print Toner Nos 5 4000 20000

Other consumables LS LS LS 5000

Expenses on consumables per annum at installed capacity (Rs) 31000



Computers 17 0.16 2.72 8 21.76

UPS 1 0.20 0.20 24 4.80

Overhead Projector 1 0.36 0.36 1 0.36

Laser Printer 1 0.50 0.50 5 2.50


Total power requirement/ day (Kwh) 33.42

Days/ annum 300



5.4 Lease Rent: Lease rent is assumed to be Rs 10,000/- per month.





Course Instructors 4 8000 384000

Administrative staff 2 3000 72000

Helpers 2 2000 48000





(Rs. in lacs)










(Rs in lacs)



Equipments 8.53 5.28% 0.45


TOTAL 0.52




given below.

(Rs in lakh)



Repayment 0.00 0.13 0.13 0.13 0.13

Interest (8%) 0.05 0.04 0.03 0.02 0.01

Closing balance 6.87 6.33 4.72 3.10 1.48


Repayment 0.00 0.13 0.13 0.13 0.13

Interest 0.05 0.04 0.03 0.02 0.01

Closing balance 6.87 6.20 4.58 2.97 1.35


Repayment 0.00 0.13 0.13 0.13 0.13

Interest 0.05 0.04 0.03 0.02 0.01

Closing balance 6.87 6.07 4.45 2.83 1.21


Repayment 0.00 0.13 0.13 0.13 0.13

Interest 0.05 0.04 0.03 0.02 0.01

Closing balance 6.87 5.93 4.31 2.70 1.08


Repayment 0.00 0.13 0.13 0.13 0.13

Interest 0.05 0.04 0.03 0.02 0.01

Closing balance 6.87 5.80 4.18 2.56 0.94


Repayment 0.00 0.13 0.13 0.13 0.13

Interest 0.05 0.04 0.03 0.02 0.01

Closing balance 6.87 5.66 4.04 2.43 0.81


Repayment 0.00 0.13 0.13 0.13 0.13

Interest 0.05 0.04 0.03 0.02 0.01

Closing balance 6.87 5.53 3.91 2.29 0.67


Repayment 0.00 0.13 0.13 0.13 0.13

Interest 0.05 0.04 0.03 0.02 0.00

Closing balance 6.87 5.39 3.77 2.16 0.54


Repayment 0.00 0.13 0.13 0.13 0.13

Interest 0.05 0.04 0.03 0.01 0.00

Closing balance 6.87 5.26 3.64 2.02 0.40


Repayment 0.13 0.13 0.13 0.13 0.13

Interest 0.05 0.04 0.02 0.01 0.00

Closing balance 6.74 5.12 3.50 1.89 0.27


Repayment 0.13 0.13 0.13 0.13 0.13

Interest 0.04 0.03 0.02 0.01 0.00

Closing balance 6.60 4.99 3.37 1.75 0.13


Repayment 0.13 0.13 0.13 0.13 0.13

Interest 0.04 0.03 0.02 0.01 0.00

Closing balance 6.47 4.85 3.23 1.62 0.00


Interest 0.55 0.46 0.33 0.20 0.07


(Rs. in lacs)



Depreciation 0.52 0.52 0.52 0.52 0.52

Interest 0.55 0.46 0.33 0.20 0.07

Total 2.20 2.96 4.26 4.21 4.16 17.79

Interest 0.55 0.46 0.33 0.20 0.07

Loan repayment 0.40 1.62 1.62 1.62 1.62

Total 0.95 2.08 1.95 1.82 1.69 8.48

DSCR 2.31 1.43 2.19 2.32 2.47

Average DSCR = 2.10


(Rs. in lacs)

Year 1 2 3


B. Variable cost

Consumables 0.19 0.22 0.25

Power 0.24 0.28 0.32






Salary 5.04 5.07 5.09







G. Cash BEP 42.87% 42.54% 41.92%


(Rs. in lacs)

Year 0 1 2 3 4 5

CASH OUTFLOW


Working Capital 0.00 0.55 0.01 0.01 0.00 0.00

Total (A) 10.43 0.55 0.01 0.01 0.00 0.00

CASH INFLOW

Profit After Tax 1.14 1.98 3.41 3.49 3.57


Add: Interest 0.55 0.46 0.33 0.20 0.07

Add: Salvage Value

Total (B) 0.00 2.20 2.96 4.26 4.21 4.16

NET FLOW (B-A) -10.43 1.65 2.95 4.25 4.21 4.16

IRR = 17%

1.0 INTRODUCTION India is the largest producer of fruits and second largest producer of vegetables in the world.

Inspite of this per capita availability of fruits and vegetables is quite low because of post harvest

losses, which account for about 25% to 30% of production. Besides, quality of a sizable quantity of

produce also deteriorates by the time it reaches the consumer. This is mainly because of

perishable nature of the produce, which requires a cold chain arrangement to maintain the quality

and extend their shelf life. In the absence of a cold storage and related cold chain facilities, the

farmers are being forced to sell their produce immediately after harvest, which results in glut

situations and low price realization. Sometime farmers do not even get their harvesting and

transportation costs. As a result, production of fruits and vegetables is not stabilized and the

farmers after burning fingers in one crop switch over to another crop in the subsequent year and

the vicious cycle continues. A cold storage facility accessible to them will go a long way in

removing the risk of distress sale to ensure better returns.

This project profile is for setting up of a 500 MT capacity cold storage with the objective of buying

fruits & vegetables directly from the farmers during the production season and sale them

throughout the year to bulk buyers. The storage of fruits and vegetables have been assumed at

50% respectively and the unit will ensure purchases during peak production period of fruits and

vegetable so that the average cost of purchases is at 40% of average sales value.

2.0 MARKET POTENTIAL Cold storages are essential for extending the shelf life, period of marketing, avoiding glut and

reducing transport bottlnecks during peak period of production and maintenance of quality of

produce. The development of cold storage industry has therefore an important role to play in

reducing the wastages of perishable commodities and thus providing remunerative prices to the

growers.

The estimated annual production of fruits and vegetables in India is about 130 million tonnes. Due

to diverse agro climatic conditions and better availability of package of practices, the production is

gradually rising. Although, there is a vast scope for increasing the production, the lack of cold

storage and cold chain facilities are becoming major bottlenecks in tapping the potential. Present

availability of cold storage capacity is only 103.5 lakh tonnes, out of which units having about 8

lakh tonnes capacity are non functional. Although 90% of these units are made to store only

potato, it still does not meet the requirement of the single crop, the production of which is about

300 lakh tonnes. Out of 3443 cold storage units setup till 1988, 2012 units were for potato, 447

units were for multipurpose use, 198 units were for fruits and vegetables and the remaining were

for products like meat, fish, milk, etc.

According to the information collected by the expert committee on cold storage and storage,

requirement of cold storage in the next five years may be in excess of 12 lakh tonnes. The working

group of the planning commission for IX plan had assessed new cold storage capacity for fruits,

vegetables and multi commodity as 15 lakh tonnes; 13 lakh tonnes in private sector, 1.5 lakh

tonnes in cooperative sector and the rest 0.5 lakh tonnes in public sector. Thus, there remains a

vast potential to be tapped.

3.0 TECHNOLOGY & PROCESS KNOWHOW

(i) Storage of foods and Storage Conditions: Foods and many other commodities can be preserved by storage at low temperature, which retards the activities of micro-organisms. Microorganisms are the spoilage agents and consist of bacteria, yeasts and molds. Low temperature does not destroy those spoilage agents as does high temperature, but greatly reduces their activities, providing a practical way of preserving perishable foods in their natural state which otherwise is not possible through heating. The low temperature necessary for preservation

depends on the storage time required often referred to as short or long term shortage and the type of product.

In general, there are three groups of products:

(a) Foods that are alive at the time of storage, distribution and sale e.g. fruits and vegetables, (b) Foods that are no longer alive and have been processed in some form e.g. meat and fish

products, and (c) Commodities that benefit from storage at controlled temperature e.g. beer, tobacco,

khandsari, etc.

Living foods such as fruits and vegetables have some natural protection against the activities of micro-organism. The best method of preserving these items is to keep the product alive and at the same time retard the natural enzyme activity, which will retard the rate of ripening or maturity.

Preservation of non-living foods is more difficult since they are susceptible to spoilage. The problem is to preserve dead tissues from decay and putrefaction. Long term storage of meat and fish product can only be achieved by freezing and then by storing it at temperature below -15oC. Only certain fruits and vegetables can benefit from freezing. However, for fruits and vegetables, one should be very careful about the recommended storage temperature and humidity a deviation from which will have adverse effect on the stored product leading to even loss of the entire commodity.

Products such as apples, tomatoes, oranges, etc. cannot be frozen and close control of temperature is necessary for long term storage. Some product can also be benefited by storing under controlled atmosphere and modified atmosphere conditions.

Dairy products are produced from animal fats and therefore non living foodstuffs. They suffer from the oxidation and breakdown of their fats, causing rancidity. Packaging to exclude air and hence Oxygen can extend storage life of such foodstuffs.

(ii) Technology: A cold storage unit incorporates a refrigeration system to maintain the desired room environment for the commodities to be stored. A refrigeration system works on two principles:

i. Vapour absorption system (VAS), and

ii. Vapour compression system (VCS)

VAS, although comparatively costlier, is quite economical in operation and adequately compensates the higher initial investment. Wherever possible such a system should be selected to conserve on energy and operational cost. However, it has its own limitations when temperature requirement is below 100C and many of the fruits and vegetables except seeds, mango, etc. require lower than 100C for long storage.

VCS is comparatively cheaper than VAS. There are three types of VCS systems available depending upon the cooling arrangements in the storage rooms i.e., diffuser type, bunker type and fin coil type. Diffuser type is comparatively costlier and is selected only when the storage room heights are low. The operational cost of such units is also higher. Bunker type is the cheapest and is preferred when storage room heights normally exceeds 11.5 m. Its operational cost is also low. Fin coil type, although about 5% costlier than the bunker type, is very energy efficient with low operational cost and higher space availability for storage of produce. Such system is used for units with room heights of 5.4m onwards.

In a refrigeration system, refrigerants are used to pick up heat by evaporation at a lower temperature and pressure from the storage space and give up the heat by condensation at a higher temperature and pressure in a condenser. Ammonia is the usually used for the purpose.

Although several types of compressors and condensers are available, medium speed reciprocating compressors and atmospheric condensers are preferred because of the relatively lower cost, energy efficiency and ease in maintenance.

While selecting size of the equipment, care should be taken to assess all loads and proper provision should be made to take care of the peak demand during summer loading and aging of the equipment. Heat load factors normally considered in a cold storage design are:

1. Wall, floor and ceiling heat gains due to conduction 2. Wall and ceiling heat gains from solar radiation 3. Load due to ingression of air by frequent door openings and during fresh air charge. 4. Product load from incoming goods 5. Heat of respiration from stored product 6. Heat from workers working in the room 7. Cooler fan load 8. Light load 9. Aging of equipment 10. Miscellaneous loads, if anyll the three systems are given in Table To remove

suspended matter from the water.

(iii) Insulation: All the sides of the cold storage room need to be insulated in order to maintain the required temperature inside. Various types of insulating materials are used for insulation of side walls, partition walls, floor and roof. However, the most commonly used insulation material is thermocoal and Poly Urethane Fibre (PUF) panels depending upon the economics of the project.




Land & site development 4.00

Building & civil works 365.93


Misc. Fixed assets 23.97




TOTAL 864.08

4.1 Land & Site Development: Details of land & site development are given below.


Site levelling, approach road, boundary fencing, etc. LS LS 500000




Cold Storage Chamber (RCC building) 1400 9000 12600000

Insulation of Cold Storage Chamber 5500 3200 17600000

Sorting Verandah 500 6000 3000000

Machine Room (RCC building) 120 9000 1080000

Administration Room (RCC building) 50 9000 450000

Genset Room (Brick wall, CGI sheet roof, Concrete Floor)

30 4000 120000

Sub total 34850000

Add: Electrification, installation, etc @ 5% 1742500

TOTAL 36592500




Cold Storage Equipments (500 MT capacity) 1 30000000 30000000

Sorting & Grading Equipments 1 2000000 2000000


Sub total 32100000


TOTAL 36915000




Installation of Transformer (500 kva capacity) 1 950000 950000

Installation of borewell 1 100000 100000

160 KVA DG Set 1 889000 889000

Weighbridge (40 ton capacity) 1 45000 45000



Sub total 2084000


TOTAL 2396600



are given below.

(Rs. In lacs)


Travelling expenses 50000

Professional & other fees 100000

Interest during implementation 3792700

Miscellaneous expenses 50000

TOTAL 3992700




fixed assets.


(Rs. in lacs)

Period (Days)



Purchases 30 30.82 36.99 43.15

Power & fuel 30 2.25 2.70 3.15

Salary 30 1.25 1.26 1.27

Goods in process 30 35.88 42.68 49.48

Receivables 15 25.68 30.82 35.96

Total 95.89 114.44 133.00





EQUITY



DEBT


TOTAL 100% 865.24


(Rs. in lacs)


A. INCOME

Capacity

utilisation

50% 60% 70% 70% 70% 70% 70%

Income from

sales/ annum

625.00 750.00 875.00 875.00 875.00 875.00 875.00

B. OPERATING

EXPENSES

Purchases 375.00 450.00 525.00 525.00 525.00 525.00 525.00

Power & Fuel 27.36 32.83 38.30 38.30 38.30 38.30 38.30

Salary 15.24 15.32 15.39 15.47 15.55 15.62 15.70

Repair &

Maintenance

9.56 9.84 10.14 10.44 10.76 11.08 11.41


Miscellaneous

Expenses

3.13 3.75 4.38 4.38 4.38 4.38 4.38

Total Operating

Expenses

436.53 519.24 601.96 602.34 602.73 603.13 603.54

Less working

expenses

capitalised

38.35 0.00 0.00 0.00 0.00 0.00 0.00


C. FINANCIAL

EXPENSES

Depreciation 33.23 33.23 33.23 33.23 33.23 33.23 33.23

Interest on Term

Loan

71.38 65.93 54.03 42.14 30.24 18.34 6.44

Interest on

Working Capital

Loan

9.21 10.99 12.77 12.77 12.77 12.77 12.77

Net Profit 113.01 120.61 173.01 184.53 196.03 207.53 219.02

Net cash

accruels

146.24 153.84 206.24 217.76 229.26 240.76 252.25

Principal

Repayment

0.00 86.52 86.52 86.52 86.52 86.52 86.52

6.1 Income from Sales: Income from sales at installed capacity is estimated as below.

Product Proportion Installed Capacity

(MT) Quantity

(MT) Avg Price (Rs/ MT)

Amount (Rs)

Fruits 50% 5000 2500 50000 125000000

Vegetables 50% 5000 2500 25000 62500000

Income from sales at 100% capacity (Rs) 187500000

6.2 Purchases: Purchases at installed capacity is estimated as below.

Product Qty/ year (MT) Avg Rate (Rs/ MT) Amount (Rs)

Fruits 2500 20000 50000000

Vegetables 2500 10000 25000000

Expenses on consumables at 100% capacity (Rs) 75000000



Connected load 250

Avg load factor 70%


Hrs/ day 24

Days/ annum 300


Rate (Rs/ unit) 5




Hrs/ annum 1440








Manager 1 15000 180000






given below. It is assumed that expenses on repair & maintenance will increase @ 3% every

subsequent year.

(Rs. in lacs)










(Rs in lacs)



Plant & Machinery 369.15 5.28% 19.49


TOTAL 33.23

6.9 Interest on Term Loan & Principal Repayment: Interest rate has been assumed at

13.75%. Duration of Loan repayment has been considered for a period of 7 years including


given below.

(Rs in lakh)

Month Year 1 2 3 4 5 6 7


Repayment 0.00 7.21 7.21 7.21 7.21 7.21 7.21

Interest (13.75%) 5.95 5.95 4.96 3.97 2.97 1.98 0.99

Closing balance 519.15 511.94 425.41 338.89 252.36 165.84 79.31


Repayment 0.00 7.21 7.21 7.21 7.21 7.21 7.21

Interest 5.95 5.87 4.87 3.88 2.89 1.90 0.91

Closing balance 519.15 504.73 418.20 331.68 245.15 158.63 72.10


Repayment 0.00 7.21 7.21 7.21 7.21 7.21 7.21

Interest 5.95 5.78 4.79 3.80 2.81 1.82 0.83

Closing balance 519.15 497.52 410.99 324.47 237.94 151.42 64.89


Repayment 0.00 7.21 7.21 7.21 7.21 7.21 7.21

Interest 5.95 5.70 4.71 3.72 2.73 1.73 0.74

Closing balance 519.15 490.31 403.78 317.26 230.73 144.21 57.68


Repayment 0.00 7.21 7.21 7.21 7.21 7.21 7.21

Interest 5.95 5.62 4.63 3.64 2.64 1.65 0.66

Closing balance 519.15 483.09 396.57 310.05 223.52 137.00 50.47


Repayment 0.00 7.21 7.21 7.21 7.21 7.21 7.21

Interest 5.95 5.54 4.54 3.55 2.56 1.57 0.58

Closing balance 519.15 475.88 389.36 302.84 216.31 129.79 43.26


Repayment 0.00 7.21 7.21 7.21 7.21 7.21 7.21

Interest 5.95 5.45 4.46 3.47 2.48 1.49 0.50

Closing balance 519.15 468.67 382.15 295.63 209.10 122.58 36.05


Repayment 0.00 7.21 7.21 7.21 7.21 7.21 7.21

Interest 5.95 5.37 4.38 3.39 2.40 1.40 0.41

Closing balance 519.15 461.46 374.94 288.41 201.89 115.37 28.84


Repayment 0.00 7.21 7.21 7.21 7.21 7.21 7.21

Interest 5.95 5.29 4.30 3.30 2.31 1.32 0.33

Closing balance 519.15 454.25 367.73 281.20 194.68 108.16 21.63


Repayment 0.00 7.21 7.21 7.21 7.21 7.21 7.21

Interest 5.95 5.20 4.21 3.22 2.23 1.24 0.25

Closing balance 519.15 447.04 360.52 273.99 187.47 100.95 14.42


Repayment 0.00 7.21 7.21 7.21 7.21 7.21 7.21

Interest 5.95 5.12 4.13 3.14 2.15 1.16 0.17

Closing balance 519.15 439.83 353.31 266.78 180.26 93.73 7.21


Repayment 0.00 7.21 7.21 7.21 7.21 7.21 7.21

Interest 5.95 5.04 4.05 3.06 2.07 1.07 0.08

Closing balance 519.15 432.62 346.10 259.57 173.05 86.52 0.00


Interest 71.38 65.93 54.03 42.14 30.24 18.34 6.44



(Rs. in lacs)



Bank Loan (60%) 57.53 68.67 79.80

Interest @ 16% 9.21 10.99 12.77


(Rs. in lacs)

Year 1 2 3 4 5 6 7 TOTAL

Net Profit 113.01 120.61 173.01 184.53 196.03 207.53 219.02

Depreciation 33.23 33.23 33.23 33.23 33.23 33.23 33.23

Interest 71.38 65.93 54.03 42.14 30.24 18.34 6.44

Total 217.62 219.77 260.27 259.89 259.50 259.10 258.69 1734.85

Interest 71.38 65.93 54.03 42.14 30.24 18.34 6.44

Loan repayment 0.00 86.52 86.52 86.52 86.52 86.52 86.52

Total 71.38 152.45 140.56 128.66 116.76 104.87 92.97 807.65

DSCR 3.05 1.44 1.85 2.02 2.22 2.47 2.78

Average DSCR = 2.15


(Rs. in lacs)

Year 1 2 3


B. Variable cost

Purchases 375.00 450.00 525.00

Power & Fuel 27.36 32.83 38.30







Salary 15.24 15.32 15.39




Total fixed cost 129.41 124.32 112.79



G. Cash BEP 23.57% 22.31% 19.49%


(Rs. in lacs)

Year 0 1 2 3 4 5 6 7

CASH OUTFLOW


Working Capital 0.00 95.89 18.56 18.56 0.00 0.00 0.00 0.00

Total (A) 764.04 95.89 18.56 18.56 0.00 0.00 0.00 0.00

CASH INFLOW

Profit After Tax 113.01 120.61 173.01 184.53 196.03 207.53 219.02


Add: Interest 71.38 65.93 54.03 42.14 30.24 18.34 6.44

Add: Salvage Value

Total (B) 0.00 217.62 219.77 260.27 259.89 259.50 259.10 258.69

NET FLOW (B-A) -764.04 121.73 201.22 241.72 259.89 259.50 259.10 258.69

IRR = 20%

1.0 INTRODUCTION Dairy farming provides an opportunity for self-employment and important source of income

generation to small/ marginal farmers and agricultural labourers. India is the largest milk producer

of the world. The increasing cost of feed ingredients and its seasonal variability can be reduced by

undertaking fodder cultivation.

This project profile on dairy farming is based on following assumption:

Freshly calved crossbred cows will be purchased in two batches of 5 animals each at an

interval of 6 months.

Availability of atleast 2 acres of land is prerequisite for cultivation of green fodder. Provision

for Shallow Tube Well has been included in the project cost for the purpose. Accordingly,

expenses on green fodder have been ignored in profitability estimate.

Cow dung produced will be utilized as manure for fodder cultivation.

Cost of rearing calves has beed ignored, as it will be adjusted by their sale.

2.0 MARKET POTENTIAL The total milk production in the country for the year 2008-09 was estimated at 108.5 million metric

tonnes and the demand is expected to be 180 million tonnes by 2020. To achieve this demand

annual growth rate in milk production has to be increased from the present 2.5 % to 5%. Thus,

there is a tremendous scope/ potential for increasing the milk production through profitable dairy

farming.





Construction of Shed 2.08

Cost of Livestock 3.50

Implements & Misc. Assets 1.35




TOTAL 7.58

3.1 Land & Site Development: No cost has been considered for land & site development. It is assumed that the project will be set up in existing farmland.

3.2 Construction of Animal Shed: Details of construction of animal shed are given below.


Shed for 10 milch animals (Half brick wall, CGI roof, concrete floor; 40 sqft/ animal)

400 400 160000

Shed for 6 calves (Half brick wall, CGI roof, concrete floor; 20 sqft/ animal)

120 400 48000

TOTAL 208000


3.3 Cost of Livestock: Details of cost of livestock are given below.


Milch animals 10 35000 350000


3.4 Implements & Misc. Assets: Details of implements & miscellaneous assets are given below.


Chaff cutter (2 HP motor) 1 50000 50000

STW (3 HP motor) 1 75000 75000


TOTAL 135000



are given below.






TOTAL 38600



cost of animal shed construction, cost of livestock and implements & miscellaneous assets.


(Rs. in lacs)

Period (Days)

Amount


Feeds & fodders 30 0.10 0.12 0.12

Power & fuel 30 0.00 0.00 0.00

Salary 30 0.06 0.06 0.06

Total 0.16 0.18 0.18





EQUITY



DEBT


TOTAL 100% 7.58


(Rs. in lacs)


A. INCOME

Production capacity (litres/ 18000 16800 16800 16800 19200

annum)

Price of milk (Rs/ litre) 25 25 25 25 25

Income from sales/ annum (Rs

lakh)

4.50 4.20 4.20 4.20 4.80


Feeds & Fodders 1.19 1.44 1.44 1.44 1.54

Power 0.02 0.02 0.02 0.02 0.02

Salary 0.72 0.73 0.73 0.74 0.75




Less: Working expenses

capitalised

0.16 0.00 0.00 0.00 0.00



Depreciation 0.14 0.14 0.14 0.14 0.14


Net Profit 2.13 1.47 1.54 1.60 2.16



5.1 Production Capacity: Total production of fresh milk per annum is estimated as below.

Year 1 Year 2 Year 3 Year 4 Year 5

Lactation days (270 days/ animal)

(i) 1st batch 1350 1050 1050 1050 1050

(ii) 2nd batch 900 1050 1050 1050 1350

Total 2250 2100 2100 2100 2400

Dry days (150 days/ animal)

(i) 1st batch 0 750 750 750 750

(ii) 2nd batch 0 750 750 750 450

Total 0 1500 1500 1500 1200

Avg. milk yield/ lactating day 8 8 8 8 8

Total yield of milk per annum (litres) 18000 16800 16800 16800 19200

It is assumed that freshly calved milch animals are purchased in two batches of 5 nos each,

with an interval of 6 months.

No. of lactation days and dry days is assumed at 270 and 150 days respectively.

No. of days per annum has been considered at 360 days.

No. of lactating days & dry days per annum for each batch has been scheduled based on the

above assumptions.

5.2 Feeds & Fodders: Expenses on feeds & fodders is estimated as below.

Particulars Qty/ day (kg) Rate (Rs) Cost/ day (Rs)

Lactation Dry Lactation Dry

Concentrate Feed 3.50 1.00 12 42 12

Dry Fodder 5.50 5.00 2 11 10

Green Fodder (Own cultivation; hence cost ignored)

Year 1 Year 2 Year 3 Year 4 Year 5

Expenses on feeds & fodders per annum (lactating days)

119250 111300 111300 111300 127200

Expenses on feeds & fodders per annum (dry days)

0 33000 33000 33000 26400

Expenses on feeds & fodders per annum (Rs) 119250 144300 144300 144300 153600

5.3 Power: Total expenses on power & fuel is estimated as below.

Particulars Quantity Power (Kw) Total (Kw) hrs/ day Kwh/ day

Chaff cutter (2 HP motor) 1 0.15 0.15 2.00 0.30

STW (3 HP motor) 1 0.22 0.22 1.00 0.22

General Lighting 2 0.10 0.17 5.00 0.87


Days/ annum 360




that salary expenses will increase @ 1% every subsequent year.



Helpers 2 3000 72000





(Rs. in lacs)


Shed 3.12 1% 0.03

Implements & Misc. Assets 1.35 2% 0.03


5.6 Miscellanous Expenses: Miscellaneous expenses have been assumed at 1% of income.



(Rs in lacs)


Shed 2.08 3.34% 0.07

Implements & Misc. Assets 1.35 5.28% 0.07

TOTAL 0.14




given below.

(Rs in lakh)



Repayment 0.00 0.09 0.09 0.09 0.09

Interest (8%) 0.03 0.03 0.02 0.01 0.01

Closing balance 4.55 4.19 3.12 2.05 0.98


Repayment 0.00 0.09 0.09 0.09 0.09

Interest 0.03 0.03 0.02 0.01 0.01

Closing balance 4.55 4.10 3.03 1.96 0.89


Repayment 0.00 0.09 0.09 0.09 0.09

Interest 0.03 0.03 0.02 0.01 0.01

Closing balance 4.55 4.01 2.94 1.87 0.80


Repayment 0.00 0.09 0.09 0.09 0.09

Interest 0.03 0.03 0.02 0.01 0.01

Closing balance 4.55 3.92 2.85 1.78 0.71


Repayment 0.00 0.09 0.09 0.09 0.09

Interest 0.03 0.03 0.02 0.01 0.00

Closing balance 4.55 3.83 2.76 1.69 0.62


Repayment 0.00 0.09 0.09 0.09 0.09

Interest 0.03 0.03 0.02 0.01 0.00

Closing balance 4.55 3.74 2.67 1.60 0.53


Repayment 0.00 0.09 0.09 0.09 0.09

Interest 0.03 0.02 0.02 0.01 0.00

Closing balance 4.55 3.66 2.59 1.52 0.45


Repayment 0.00 0.09 0.09 0.09 0.09

Interest 0.03 0.02 0.02 0.01 0.00

Closing balance 4.55 3.57 2.50 1.43 0.36


Repayment 0.00 0.09 0.09 0.09 0.09

Interest 0.03 0.02 0.02 0.01 0.00

Closing balance 4.55 3.48 2.41 1.34 0.27


Repayment 0.09 0.09 0.09 0.09 0.09

Interest 0.03 0.02 0.02 0.01 0.00

Closing balance 4.46 3.39 2.32 1.25 0.18


Repayment 0.09 0.09 0.09 0.09 0.09

Interest 0.03 0.02 0.02 0.01 0.00

Closing balance 4.37 3.30 2.23 1.16 0.09


Repayment 0.09 0.09 0.09 0.09 0.09

Interest 0.03 0.02 0.01 0.01 0.00

Closing balance 4.28 3.21 2.14 1.07 0.00


Interest 0.36 0.30 0.22 0.13 0.05


(Rs. in lacs)



Depreciation 0.14 0.14 0.14 0.14 0.14

Interest 0.36 0.30 0.22 0.13 0.05

Total 2.64 1.91 1.89 1.87 2.35 10.67

Interest 0.36 0.30 0.22 0.13 0.05

Loan repayment 0.27 1.07 1.07 1.07 1.07

Total 0.63 1.37 1.29 1.20 1.12 5.61

DSCR 4.19 1.39 1.47 1.56 2.11

Average DSCR = 1.90


(Rs. in lacs)

Year 1 2 3


B. Variable cost

Feeds & Fodders 1.19 1.44 1.44

Power 0.02 0.02 0.02





Salary 0.72 0.73 0.73







(Rs. in lacs)

Year 0 1 2 3 4 5

CASH OUTFLOW


Working Capital 0.00 0.16 0.02 0.00 0.00 0.00

Total (A) 6.93 0.16 0.02 0.00 0.00 0.00

CASH INFLOW

Profit After Tax 2.13 1.47 1.54 1.60 2.16


Add: Interest 0.36 0.30 0.22 0.13 0.05


Total (B) 0.00 2.64 1.91 1.89 1.87 3.04

NET FLOW (B-A) -6.93 2.48 1.89 1.89 1.87 3.04

IRR = 18%

1.0 INTRODUCTION Among the various livestock species, piggery has most potential as a source of meat production

and is the most efficient feed converters after the broiler.

The advantages of the pig farming are:

i. Pig has the highest feed conversion efficiency i.e. they produce more live weight gain from a

given weight of feed than any other class of meat producing animals except broilers.

ii. They can utilise wide variety of feed stuffs viz. grains, forages, damaged feeds and garbage

and convert them into valuable nutritious meat. However, feeding of damaged grains,

garbage and other unbalanced rations may result in lower feed efficiency.

iii. They are prolific with shorter generation interval. A sow can be breed as early as 8-9 months

of age and can farrow twice in a year. They produce 6-12 piglets in each farrowing.

iv. Pigs are known for their meat yield, which in terms of dressing percentage ranges from 65 -

80 in comparison to other livestock species whose dressing yields may not exceed 65%.

v. Pork is most nutritious with high fat and low water content and has better energy value than

that of other meats. It is rich in vitamins like thiamin, Niacin and riboflavin.

vi. Pigs manure is widely used as fertilizer for agriculture farms and fish ponds.

This project profile on piggery is based on the following assumptions:

10 nos. of 6-7 month old breeding sows are purchased in 2 batches of 5 nos each at an

interval of 3 months. 1 boar is also purchased to service the sows.

The 1st batch is sow is serviced immediately upon procurement so that farrowing happens in

the 5th month of 1st year. The 2nd batch of sow is also serviced likewise so that farrowing

happens in the 1st month of next year. Subsequent farrowings occur at an interval of 6

months.

The sows are culled after 10 farrowings so that the project duration is for 6 years.

2.0 MARKET POTENTIAL According to 18th Livestock Census of India (2007), the total swine population, while small, has

grown consistently over the past 50 years.

Pork occupies an important place in the diet of most of the people in North East India.

Consequently, there is a great local demand for pork meat, which is mostly met with imports from

outside the Region. A market is growing fast for the local bred pigs, giving the people a marketing

opportunity to sustainably increase their household incomes.



(Rs. in lacs)



Construction of Pig Sty 6.63

Cost of Livestock 0.67

Implements & Misc. Assets 0.90



Working capital 3.89

TOTAL 13.44

3.1 Land & Site Development: No cost has been considered for land & site development. It is assumed that the project will be set up in existing farmland.

3.2 Construction of Pig Sty: Details of animal shed are given below.


Farrowing Pens (5 nos) for lactating sow (Half

brick wall, CGI roof, concrete floor; 100 sqft/ pen)

500 250 125000

Boar cum Service Pen (1 Nos; Half brick wall,

CGI roof, concrete floor; 70 sqft/ pen)

70 250 17500

Dry Sow Pens (5 nos; Half brick wall, CGI roof,

concrete floor; 20 sqft/ pen)

100 250 25000

Fattener Shed (120 nos; Half brick wall, CGI roof,

concrete floor; 15 sqft/ pen)

1800 250 450000

Store Room (Brick wall, CGI roof, concrete floor) 150 300 45000

TOTAL 662500


3.3 Cost of Livestock: Details of cost of livestock are given below.


Cost of Sows 10 6000 60000

Cost of Boar 1 7000 7000

TOTAL 67000


3.4 Implements & Misc. Assets: Details of implements & miscellaneous assets are given below.


Water Supply System (STW boring, 3 HP motor pump set, water tank, pipes & fittings)

1 75000 75000

Electrification LS LS 10000


TOTAL 90000



are given below.

(Rs. in lacs)





Interest during gestation period 0.66


TOTAL 1.13


cost of construction, cost of livestock and implements & miscellaneous assets.


(Rs. in lacs)

Working capital requirement for Yr 1 Period (Months) Amount (Rs)

Feeds 12 2.08

Power & fuel 12 0.08

Salary 12 1.08

Medicines 12 0.66

Total 3.89





EQUITY



DEBT


TOTAL 100% 13.44


(Rs. in lacs)

Particulars Yr 1 Yr 2 Yr 3 Yr 4 Yr 5 Yr 6

A. INCOME

Production capacity (kg/ annum) 0 10640 10640 10640 10640 10640

Price of pork (Rs/ kg) 105 105 105 105 105 105

Income from sales/ annum (Rs lakh) 0.00 11.17 11.17 11.17 11.17 11.17


Feeds 2.08 4.01 4.01 4.01 4.01 2.53

Power 0.08 0.08 0.08 0.08 0.08 0.08

Salary 1.08 1.09 1.10 1.11 1.12 1.14

Repair & Maintenance 0.09 0.10 0.11 0.12 0.14 0.15

Medicines for Breeder Stock & Fatteners 0.66 0.86 0.86 0.86 0.86 0.26

Insurance 0.55 0.55 0.55 0.55 0.55 0.55

Miscellaneous Expenses 0.00 0.34 0.34 0.34 0.34 0.34

Total Operating Expenses 4.53 7.02 7.05 7.07 7.09 5.03

Less: Working expenses capitalised 3.89 0.00 0.00 0.00 0.00 0.00

Operating profit -0.64 4.15 4.13 4.10 4.08 6.14


Depreciation 0.27 0.27 0.27 0.27 0.27 0.27

Interest on Term Loan 0.65 0.59 0.46 0.33 0.20 0.07

Net Profit -1.56 3.29 3.40 3.51 3.61 5.80

Net cash accruels -1.29 3.56 3.67 3.78 3.88 6.07

Principal Repayment 0.00 1.61 1.61 1.61 1.61 1.61

5.1 Production Capacity: Total production of pork per annum is estimated as below.

Particulars Year 1 Year 2 Year 3 Year 4 Year 5 Year 6

Schedule & number of surviving piglets/ annum

B1 B2 B1 B2 B1 B2 B1 B2 B1 B2 B1 B2

Month 2 40 40 40 40 40

Month 5 40 40 40 40 40

Month 8 40 40 40 40 40

Month 11 40 40 40 40 40

Schedule & number of

Month 1 38 38 38 38 38

Month 4 38 38 38 38 38

disposal of fatteners/ annum

Month 7 38 38 38 38 38

Month 10 38 38 38 38 38

No. of fatteners for sale/ annum

0 152 152 152 152 152

Avg. wt. of fatteners (kg)

100 100 100 100 100 100

Recovery of pork from live animal (%)

70% 70% 70% 70% 70% 70%

Total production of pork per annum (kg)

0 10640 10640 10640 10640 10640

**B1 – Batch 1: B2 – Batch 2

There are two batches of sows at 3 months interval. 1st batch will start farrowing in the 5th

month, while 2nd batch will start in the 8th month. Subsequent farrowings are at an interval of

6 months.

10 piglets will be produced per sow per farrowing. Considering mortality rate for piglets at

20%, each farrowing of a batch will produce 40 surviving piglets.

Sows are culled after 10 farrowings.

There is no sale of piglets. All piglets are raised as fatteners and disposed off after 8 months.

Mortality rate for fatteners has been assumed at 5%.

5.2 Feeds: Expenses on feeds are estimated as below.

Particulars Quantity/ animal/ day (kg)

Feed composition (%) Rate (Rs/ kg) Cost/ animal/ day (Rs)

Feed concentrates

Kitchen /Farm waste

Feed concentrates

Kitchen /Farm waste

Fattener feed

2.00 30%

70% 12 2 10

Breeder feed

3.00 30%

70% 12 2 15

Piglet feed 0.25 30% 70% 12 2 1

Schedule of annual piglet production & fattener disposal

Year 1 Year 2 Year 3 Year 4 Year 5 Year 6

B1 B2 B1 B2 B1 B2 B1 B2 B1 B2 B1 B2

Month 1 -40 -40 -40 -40 -40

Month 2 40 40 40 40 40

Month 3

Month 4 -40 -40 -40 -40 -40

Month 5 40 40 40 40 40

Month 6

Month 7 -40 -40 -40 -40 -40

Month 8 40 40 40 40 40

Month 9

Month 10 -40 -40 -40 -40 -40

Month 11 40 40 40 40 40

Month 12

No. of feed units for fatteners (days x No. of animals)

Batch 1 (1st farrow)

8400

Batch 2 (1st farrow)

4800 3600

Batch 1 (2nd farrow)

1200

7200

Batch 2 (2nd farrow) 8400

Batch 1 (3rd farrow)

8400

Batch 2 (3rd farrow) 4800

3600

Batch 1 (4th farrow)

1200 7200


8400

Batch 1 (5th farrow) 8400


4800

3600


7200


8400


8400


4800

3600


1200 7200


8400



4800 3600


7200


Yr 1 Yr 2 Yr 3 Yr 4 Yr 5 Yr 6

Total feed units per annum for fatteners 14400 33600 33600 33600 33600 19200

Expenses on fattener feeds per annum (Rs)

144000 336000

336000 336000 336000

192000

Expenses on breeder feed per annum 59400 59400 59400 59400 59400 59400

No. of piglets (upto 30 days) per annum 120 160 160 160 160 40

Expenses on piglet feeds per annum (Rs) 4500 6000 6000 6000 6000 1500

Expenses on feeds per annum (Rs) 20790

0 401400 40140

0 401400 401400 25290

0

5.3 Power: Total expenses on power are estimated as below.


Pump set (3 HP motor) 1 0.22 0.22



No. of hrs/ day 5

Days/ annum 360





that salary expenses will increase @ 1% every subsequent year.



Helpers 3 3000 108000





(Rs. in lacs)


Pig Sty 6.63 1% 0.07

Implements & Misc. Assets 0.90 3% 0.03


5.6 Medicines: Expenses on medicines for breeder stock & fatteners is estimated as below.

Particulars Yr 1 Yr 2 Yr 3 Yr 4 Yr 5 Yr 6

No. of breeders/ annum 11 11 11 11 11 11

No. of fatteners/ annum 120 160 160 160 160 40

Cost/ animal/ annum 500 500 500 500 500 500

Expenses on medicines per annum 65500 85500 85500 85500 85500 25500

5.7 Insurance: Insurance expense has been assumed at 5% of breeder stock.

5.8 Miscellaneous Expenses: Miscellaneous expenses have been assumed at 3% of income.



(Rs in lacs)


Pig Sty 6.63 3.34% 0.22

Implements & Misc. Assets 0.90 5.28% 0.05

TOTAL 0.27




are given below.

(Rs in lakh)

Month Year 1 2 3 4 5 6

Month 1 Opening balance 8.06 8.06 6.45 4.84 3.23 1.61

Repayment 0.00 0.13 0.13 0.13 0.13 0.13

Interest (8%) 0.05 0.05 0.04 0.03 0.02 0.01

Closing balance 8.06 7.93 6.32 4.70 3.09 1.48


Repayment 0.00 0.13 0.13 0.13 0.13 0.13

Interest 0.05 0.05 0.04 0.03 0.02 0.01

Closing balance 8.06 7.80 6.18 4.57 2.96 1.34


Repayment 0.00 0.13 0.13 0.13 0.13 0.13

Interest 0.05 0.05 0.04 0.03 0.02 0.01

Closing balance 8.06 7.66 6.05 4.44 2.82 1.21


Repayment 0.00 0.13 0.13 0.13 0.13 0.13

Interest 0.05 0.05 0.04 0.03 0.02 0.01

Closing balance 8.06 7.53 5.91 4.30 2.69 1.08


Repayment 0.00 0.13 0.13 0.13 0.13 0.13

Interest 0.05 0.05 0.04 0.03 0.02 0.01

Closing balance 8.06 7.39 5.78 4.17 2.55 0.94


Repayment 0.00 0.13 0.13 0.13 0.13 0.13

Interest 0.05 0.05 0.04 0.03 0.02 0.01

Closing balance 8.06 7.26 5.65 4.03 2.42 0.81


Repayment 0.00 0.13 0.13 0.13 0.13 0.13

Interest 0.05 0.05 0.04 0.03 0.02 0.01

Closing balance 8.06 7.12 5.51 3.90 2.29 0.67


Repayment 0.00 0.13 0.13 0.13 0.13 0.13

Interest 0.05 0.05 0.04 0.03 0.02 0.00

Closing balance 8.06 6.99 5.38 3.76 2.15 0.54


Repayment 0.00 0.13 0.13 0.13 0.13 0.13

Interest 0.05 0.05 0.04 0.03 0.01 0.00

Closing balance 8.06 6.86 5.24 3.63 2.02 0.40


Repayment 0.00 0.13 0.13 0.13 0.13 0.13

Interest 0.05 0.05 0.03 0.02 0.01 0.00

Closing balance 8.06 6.72 5.11 3.49 1.88 0.27


Repayment 0.00 0.13 0.13 0.13 0.13 0.13

Interest 0.05 0.04 0.03 0.02 0.01 0.00

Closing balance 8.06 6.59 4.97 3.36 1.75 0.13


Repayment 0.00 0.13 0.13 0.13 0.13 0.13

Interest 0.05 0.04 0.03 0.02 0.01 0.00

Closing balance 8.06 6.45 4.84 3.23 1.61 0.00

Principal Repayment 0.00 1.61 1.61 1.61 1.61 1.61

Interest 0.65 0.59 0.46 0.33 0.20 0.07


(Rs. in lacs)

Year 1 2 3 4 5 6 TOTAL

Profit After Tax (Net Profit) -1.56 3.29 3.40 3.51 3.61 5.80

Depreciation 0.27 0.27 0.27 0.27 0.27 0.27

Interest 0.65 0.59 0.46 0.33 0.20 0.07

Total -0.64 4.15 4.13 4.10 4.08 6.14 21.96

Interest 0.65 0.59 0.46 0.33 0.20 0.07

Loan repayment 0.00 1.61 1.61 1.61 1.61 1.61

Total 0.65 2.20 2.07 1.94 1.81 1.68 10.35

DSCR -1.00 1.89 1.99 2.11 2.25 3.65

Average DSCR = 2.12


(Rs. in lacs)

Year 1 2 3


B. Variable cost

Feeds 2.08 4.01 4.01

Power 0.08 0.08 0.08

Medicines 0.66 0.86 0.86

Insurance 0.55 0.55 0.55



C. Contribution (A-B) -3.36 5.34 5.34


Salary 1.08 1.09 1.10





E. BREAKEVEN POINT -62.10% 38.35% 36.33%


(Rs. in lacs)

Year 0 1 2 3 4 5 6

CASH OUTFLOW

Capital Expenditure 8.20 0.00 0.00 0.00 0.00 0.00 0.00

Working Capital 0.00 3.89 -3.89 0.00 0.00 0.00 0.00

Total (A) 8.20 3.89 0.00 0.00 0.00 0.00 0.00

CASH INFLOW

Profit After Tax -1.56 3.29 3.40 3.51 3.61 5.80

Add: Depreciation 0.27 0.27 0.27 0.27 0.27 0.27

Add: Interest 0.65 0.59 0.46 0.33 0.20 0.07


0.00 -0.64 4.15 4.13 4.10 4.08 7.37

NET FLOW (B-A) -8.20 -4.53 4.15 4.13 4.10 4.08 7.37

IRR = 18%

1.0 INTRODUCTION Poultry meat is an important source of high quality proteins, minerals and vitamins to balance the

human diet. Specially developed varieties of chicken (broilers) are now available with the traits of

quick growth and high feed conversion efficiency. Depending on the farm size, broiler farming can

be a main source of family income or can provide subsidiary income and gainful employment to

farmers throughout the year. Poultry manure is of high fertilizer value, which can be used for

increasing yield of all crops.

The advantages of broiler farming are

Initial investment is a little lower than layer farming.

Rearing period is 5-6 weeks only

More number of flocks can be taken in the same shed.

Broilers have high feed conversion efficiency i.e. the amount of feed required for unit body

weight gain is lower in comparison to other livestock.

This project profile on broiler farming is based on the assumption that Day Old Chicks (DOC) will

be procured in batches of 2500 at intervals of 2 weeks, i.e, two batches will be procured per month.

2.0 MARKET POTENTIAL India has made considerable progress in broiler production in the last three decades. The broiler

production has sky rocketed at an annual growth rate of about 10% and stands at about 2.3 million

metric tons of chicken meat (FAO 2005). The population of broiler poultry as per 2004-05 census is

199.73 million. Despite this achievement, the annual per capita consumption in India is only 1600

grams of poultry meat as against the world average of 5.9 kg of meat.

In North East India, commercialization of poultry farming is yet to take deep roots due to problems

on the inputs front. The Animal Husbandry and Veterinary Department cater to the requirement of

poultry inputs and training in a limited way. It’s the private sector based in the neighbouring states

like West Bengal and Bihar, which is catering to the requirement of the Day- Old-Chicks (DOC) and

feed in Assam. There is tremendous demand for broiler chicken in the region and a large portion of

the demand is met from other states. The industry particularly the broiler sector has grown

tremendously during the period. In comparison to the local chicken, broiler chicken has attained a

significant rise in growth, because of quick maturity, less hen house days, easy operation and

substantial economic return.

In respect of growth of poultry farming, there has been a phenomenal rise in the growth rate of

improved poultry (fowls) population in the last one and half decade. As per a survey on

consumption pattern of poultry products in India, in urban areas, the per capita consumption of

eggs is estimated at 100 nos and 1200 gms of poultry meat per annum. With the increase in

income levels, the per capita consumption is bound to increase in the years to come.



(Rs. in lacs)




Equipments 1.58





TOTAL 10.66

3.1 Land & Site Development: No cost has been considered for land & site development. It is assumed that the project will be set up in existing land.

3.2 Building & Civil Works: Details of expenses on building & civil works are given below.


Broiler Shed (Half brick wall, CGI roof, concrete floor; 1 sqft/ bird)

3000 100 300000

Store Room (Brick wall, CGI roof, concrete floor) 100 400 40000

TOTAL 340000


3.3 Equipments: Details of expenses on equipments are given below.


Mini Feeder 100 125 12500

Medium Feeder 100 160 16000

Large Feeder 100 270 27000

Mini Drinker 100 70 7000

Bell Drinker 100 180 18000

Gas Brooder 5 3650 18250

Bokhari 10 3500 35000


Sub total 143750

Add: Transporation, installaton, etc @ 10% 14375

TOTAL 158125


3.4 Misc. Fixed Assets: Details of expenses on miscellaneous fixed assets are given below.


Water Supply System (STW boring, 3 HP motor pump set, water tank, pipes & fittings)

1 75000 75000

Electrification LS LS 10000


TOTAL 90000



are given below.






TOTAL 36800


3.6 Contingencies & Escalation: Expenses on contingencies & escalation has been assumed

at 3% of the cost of building & civil works, equipments and miscellaneous fixed assets.

3.7 Working Capital: Details of expenses on working capital are given below.

(Rs. in lacs)


Amount


Day Old Chicks 45 1.15 1.15 1.15

Feeds 45 2.98 2.98 2.98

Power & fuel 30 0.01 0.01 0.01

Salary 30 0.09 0.09 0.09

Total 4.24 4.24 4.24





EQUITY



DEBT


TOTAL 100% 10.66


(Rs. in lacs)


A. INCOME

Production capacity (kg/ annum) 50160 54720 54720 54720 54720

Price of chicken (Rs/ kg) 70 70 70 70 70



Day Old Chicks 9.36 9.36 9.36 9.36 9.36

Feeds 24.19 24.19 24.19 24.19 24.19

Power & fuel 0.17 0.17 0.17 0.17 0.17

Salary 1.08 1.09 1.10 1.11 1.12


Insurance 0.18 0.18 0.18 0.18 0.18






Depreciation 0.16 0.16 0.16 0.16 0.16


Net Profit 3.56 2.57 2.67 2.77 2.87



5.2 Production Capacity: Total production of broiler chicken per annum is estimated as below.

No. of birds/ batch 1500 No. of batches/ month 2 Duration of a cycle (Months) 1.5 Schedule of batches (No. of birds) & disposal of Year 1 Year 2 onwards

chicks In Out In Out

Month 1 3000 3000 3000

Month 2 3000 3000 3000 3000

Month 3 3000 3000 3000 3000

Month 4 3000 3000 3000 3000

Month 5 3000 3000 3000 3000

Month 6 3000 3000 3000 3000

Month 7 3000 3000 3000 3000

Month 8 3000 3000 3000 3000

Month 9 3000 3000 3000 3000

Month 10 3000 3000 3000 3000

Month 11 3000 3000 3000 3000

Month 12 3000 3000 3000 3000

No. of birds for sale per annum (Scheduled) 33000 36000

Mortality rate of chicks (5%) 1650 1800

No. of birds available for sale per annum 31350 34200

Avg. weight of birds (kg) 1.60 1.60

Total production of chicken per annum (kg) 50160 54720

5.2 Day Old Chicks: Expenses on purchase of day old chicks are estimated as below.


Expenses on purchase of day old chicks per annum 36000 26 936000

5.3 Feeds: Expenses on purchase of feeds is estimated as below.

Particulars No. of birds Feed (kg/ bird) Rate (Rs/ kg) Amount (Rs)

Expenses on feeds per annum 36000 3.20 21 2419200

5.4 Power & Fuel: Expenses on power & fuel is as below.

Particulars Quantity Power (Kw)

Total (Kw)

hrs/ day

kwh/ day

Pump Set (3 HP) 1 2.24 2.24 1 2.24



Days/ annum 360







Helpers 3 3000 108000



given below. It is assumed that expenses on salary will increase @ 10% every subsequent

year.

(Rs. in lacs)






5.7 Insurance: Insurance expense is estimated as below.

Particulars No. of birds/ annum Rate (Rs/ bird) Amount (Rs)

Expenses on insurance per annum 36000 0.50 18000

5.8 Miscellaneous Expenses: Miscellaneous expenses have been assumed at 0.2% of income.



(Rs in lacs)


Pig Sty 3.40 3.34% 0.11


TOTAL 0.16




given below.

(Rs in lakh)



Repayment 0.00 0.13 0.13 0.13 0.13

Interest (8%) 0.04 0.04 0.03 0.02 0.01

Closing balance 6.40 5.90 4.39 2.89 1.38


Repayment 0.00 0.13 0.13 0.13 0.13

Interest 0.04 0.04 0.03 0.02 0.01

Closing balance 6.40 5.77 4.27 2.76 1.25


Repayment 0.00 0.13 0.13 0.13 0.13

Interest 0.04 0.04 0.03 0.02 0.01

Closing balance 6.40 5.65 4.14 2.63 1.13


Repayment 0.00 0.13 0.13 0.13 0.13

Interest 0.04 0.04 0.03 0.02 0.01

Closing balance 6.40 5.52 4.01 2.51 1.00


Repayment 0.00 0.13 0.13 0.13 0.13

Interest 0.04 0.04 0.03 0.02 0.01

Closing balance 6.40 5.40 3.89 2.38 0.88


Repayment 0.00 0.13 0.13 0.13 0.13

Interest 0.04 0.04 0.03 0.02 0.01

Closing balance 6.40 5.27 3.76 2.26 0.75


Repayment 0.00 0.13 0.13 0.13 0.13

Interest 0.04 0.04 0.03 0.02 0.01

Closing balance 6.40 5.14 3.64 2.13 0.63


Repayment 0.00 0.13 0.13 0.13 0.13

Interest 0.04 0.03 0.02 0.01 0.00

Closing balance 6.40 5.02 3.51 2.01 0.50


Repayment 0.00 0.13 0.13 0.13 0.13

Interest 0.04 0.03 0.02 0.01 0.00

Closing balance 6.40 4.89 3.39 1.88 0.38


Repayment 0.13 0.13 0.13 0.13 0.13

Interest 0.04 0.03 0.02 0.01 0.00

Closing balance 6.27 4.77 3.26 1.76 0.25


Repayment 0.13 0.13 0.13 0.13 0.13

Interest 0.04 0.03 0.02 0.01 0.00

Closing balance 6.15 4.64 3.14 1.63 0.13


Repayment 0.13 0.13 0.13 0.13 0.13

Interest 0.04 0.03 0.02 0.01 0.00

Closing balance 6.02 4.52 3.01 1.51 0.00


Interest 0.51 0.43 0.31 0.19 0.07


(Rs. in lacs)



Depreciation 0.16 0.16 0.16 0.16 0.16

Interest 0.51 0.43 0.31 0.19 0.07

Total 4.23 3.16 3.14 3.12 3.10 16.73

Interest 0.51 0.43 0.31 0.19 0.07

Loan repayment 0.38 1.51 1.51 1.51 1.51

Total 0.89 1.93 1.81 1.69 1.57 7.89

DSCR 4.77 1.63 1.73 1.84 1.97

Average DSCR = 2.12


(Rs. in lacs)

Year 1 2 3


B. Variable cost

Day Old Chicks 9.36 9.36 9.36

Feeds 24.19 24.19 24.19

Power & fuel 0.17 0.17 0.17

Insurance 0.18 0.18 0.18





Salary 1.08 1.09 1.10






F. Cash Breakeven Point 145.62% 36.95% 34.61%


(Rs. in lacs)

Year 0 1 2 3 4 5

CASH OUTFLOW


Working Capital 0.00 4.24 0.00 0.00 0.00 0.00

Total (A) 5.88 4.24 0.00 0.00 0.00 0.00

CASH INFLOW

Profit After Tax 3.56 2.57 2.67 2.77 2.87


Add: Interest 0.51 0.43 0.31 0.19 0.07


Total (B) 0.00 4.23 3.16 3.14 3.12 3.98

NET FLOW (B-A) -5.88 -0.01 3.15 3.14 3.12 3.98

IRR = 27%

1.0 INTRODUCTION Vermicomposting is defined as the production of compost with the use of worms. It is a fast way to

convert organic farm waste into organic fertilizer. It degrades waste as vermi or earthworm feed on

and digests waste materials. Vermicomposting results in a better quality product that is produced in

only 75 days as compared to ordinary compost that is produced in 8-12 weeks.

Vermicompost is an excellent soil enhancer and bioactive fertilizer for organic farming. Earthworms

can also be made into feed for fish or other domesticated animals.

This project profile on Vermicompost is based HDPE Vermi Beds and Sheds, which are light in

weight and can be transported cheaply and makes it easy to set them up in remote locations. The

installation cost is much cheaper without any requirement for expensive earthwork, digging and

concrete works.

2.0 MARKET POTENTIAL Organic solid waste management by employing earthworms has multifarious role to play. Firstly, it

makes way for utilization of available organic wastes to produce the rich source of organic manure

of high quality, which is superior to other types of organic manures in its physico-chemical and

biological properties. Secondly, the manure is produced in a short duration of time and is a fully

matured, homogenous matter. Thirdly, the programme provides job opportunities for the unskilled

labour force. Finally, it is the best way of safeguarding the environment. Vermicompost has been

adjudged as the best source of organic amendments to soil. Using vermicompost can fulfill the

requirements for organically grown products, which are becoming popular in the modern society.

3.0 PROCESS DESCRIPTION (a) Collect and shred biodegradable materials/ agricultural wastes such as fruit/ vegetable

trimmings, peelings, and dry leaves and stem. (b) Mix old animal manure such as cow dung and chicken droppings with shredded agricultural

vegetable waste. This will improve the nutrient content of the finish product. Do not use fresh manure for the ammonia produced will give discomfort to the worms.

(c) Sun-dry these materials for at least three days and let them undergo partial fermentation. (d) Weigh the shredded grinded materials before putting in the compost bed to determine ratio of

compostables and worms. (e) Before stocking the earthworms, make sure that all materials in the vermi bed are prepared.

Moisten the bedding with water and cover it with black plastic garbage bag, old sacks, net, or banana leaves to start “anaerobic process”, which is completed after 1-2 weeks.

(f) After the anaerobic process, remove the cover and stock the vermi bed with earthworms. (g) Maintain the vermi beds’ moisture content and temperature through regular checking. Protect

the worms from predatory animals. (h) Vermicompost is harvested when most of the materials have been consumed by the worms.

This takes about 8-10 weeks depending on environmental and culture conditions. (i) In harvesting, separate the “vermi” from the vermicompost either manually (handpicking) or

using a strainer/sifter. (j) Properly pack vermicompost in sacks and store in a cool dry place.

(k) Harvested/ sifted vermi from the vermi beds may either be used for the next vermicomposting cycle or for expansion by constructing additional vermi beds.



Particulars Amount


Vermi Beds 3.00

Implements & Equipments 0.83





TOTAL 6.35

4.1 Land & Site Development: No cost has been considered for land & site development. It is assumed that the project will be set up in existing land.

4.2 Vermi Beds: Details of expenses on Vermi Beds is below.


HDPE Vermi Beds (3.6 x 1.5 x 0.6 cum) Nos 50 3500 175000

Shed for Vermi Beds Sqm 280 350 98000

Sub total 273000

Add: Installation, transportation, etc @ 10% 27300

TOTAL 300300


4.3 Implements & Equipments: Details of expenses on implements & equipments are given

below.


Power Shredder 1 25000 25000

Sieving Machine 1 40000 40000

Miscellaneous Implements LS LS 10000

Sub total 75000

Add: Installation, transporation,etc @ 10% 7500

TOTAL 82500


4.4 Misc. Fixed Assets: Details of expenses on miscellaneous fixed assets are given below.


Water supply system (STW with 3 HP pump set, storage, pipes & fittings)

1 75000 75000


Sub total 80000

Add: Installation, transportation, etc @ 10% 8000

TOTAL 88000



are given below.






TOTAL 35144



cost of vermi beds, implements & equipments and miscellaneous fixed assets.

4.7 Working Capital: Details of working capital margin is given below.

(Rs. In lacs)

Period (days)

Amount

Yr 1 Yr 2 Yr 3


Power & fuel 75 0.37 0.39 0.41

Salary 75 0.68 0.78 0.87

Total 1.14 1.28 1.42

Working capital margin in Year 1 (100%) 1.14




EQUITY



DEBT


TOTAL 100% 6.35


(Rs. in lacs)


A. INCOME



Total production at capacity utilisation 66226 75686 85147 85147 85147

Price/ kg of compost (Rs) 5.00 5.00 5.00 5.00 5.00

Income from sales (Rs lakh) 3.31 3.78 4.26 4.26 4.26



Power & fuel 0.08 0.09 0.10 0.10 0.10

Salary 1.08 1.09 1.10 1.11 1.12







Depreciation 0.26 0.26 0.26 0.26 0.26


Net Profit 2.09 1.36 1.79 1.84 1.89



6.1 Production Capacity: Total production capacity per annum is estimated as below.

Volume/ Vermi Bed (cum) 3.24

No. of Vermi Beds 50

Total capacity of vermibeds (cum) 162

Proportion of agriculture waste by weight (320 kg/ cum) 51840

Proportion of cowdung by weight (80 kg/ cum) 12960

Total quantity of raw materials by weight (kg) 64800

Recovery of vermicompost from raw materials (%) 30%

Production of vermicompost/ cycle (kg) 19440

Duration of cycle (Days) 75

Days/ annum 365

Total production of vermicompost per annum at 100% capacity (kg) 94608

6.2 Raw Materials & Consumables: Expenses on raw materials & consumables is estimated as

below.

Particulars kg/ cum Rate (Rs/ kg) Amount (Rs)

Agricultural waste/ cum/ cycle 320 0.10 32

Cowdung/ cum/ cycle 80 0.15 12

Earthworms/ cum/ cycle (350/ cum; 500 worms/ kg) 0.70 50.00 35

Expenses on raw materials/ cum/ cycle 79

Total capacity of vermibeds 162

No. of cycles/ annum 5

Expenses on raw materials per annum (Rs) 62284

Add: Expenses on packing materials, etc. @ 10% 6228

Expenses on raw materials & consumables per annum at 100% capacity (Rs) 68512



Pump set (3 HP) 1 2.24 2.24 1.00 2.24

Power Shredder 1 0.20 0.20 1.00 0.20

Sieving Machine 1 0.20 0.20 1.00 0.20

General Lighting 7 0.10 0.70 5.00 3.50

Total power requirement/ day (Kwh) 6.14

Days/ annum 365







Helpers 3 3000 108000





(Rs. in lacs)


Vermi Beds 3.00 2% 0.06

Implements & Equipments 0.83 2% 0.02






(Rs in lacs)


Vermi Beds 3.00 5.00% 0.15

Implements & Equipments 0.83 7.07% 0.06


TOTAL 0.26




given below.

(Rs in lakh)

Year 1 2 3 4 5


Repayment 0.00 0.07 0.07 0.07 0.07

Interest (8%) 0.03 0.02 0.02 0.01 0.01

Closing balance 3.81 3.51 2.61 1.72 0.82


Repayment 0.00 0.07 0.07 0.07 0.07

Interest 0.03 0.02 0.02 0.01 0.01

Closing balance 3.81 3.44 2.54 1.64 0.75


Repayment 0.00 0.07 0.07 0.07 0.07

Interest 0.03 0.02 0.02 0.01 0.00

Closing balance 3.81 3.36 2.47 1.57 0.67


Repayment 0.00 0.07 0.07 0.07 0.07

Interest 0.03 0.02 0.02 0.01 0.00

Closing balance 3.81 3.29 2.39 1.49 0.60


Repayment 0.00 0.07 0.07 0.07 0.07

Interest 0.03 0.02 0.02 0.01 0.00

Closing balance 3.81 3.21 2.32 1.42 0.52


Repayment 0.00 0.07 0.07 0.07 0.07

Interest 0.03 0.02 0.02 0.01 0.00

Closing balance 3.81 3.14 2.24 1.34 0.45


Repayment 0.00 0.07 0.07 0.07 0.07

Interest 0.03 0.02 0.01 0.01 0.00

Closing balance 3.81 3.06 2.17 1.27 0.37


Repayment 0.00 0.07 0.07 0.07 0.07

Interest 0.03 0.02 0.01 0.01 0.00

Closing balance 3.81 2.99 2.09 1.20 0.30


Repayment 0.00 0.07 0.07 0.07 0.07

Interest 0.03 0.02 0.01 0.01 0.00

Closing balance 3.81 2.91 2.02 1.12 0.22


Repayment 0.07 0.07 0.07 0.07 0.07

Interest 0.03 0.02 0.01 0.01 0.00

Closing balance 3.73 2.84 1.94 1.05 0.15


Repayment 0.07 0.07 0.07 0.07 0.07

Interest 0.02 0.02 0.01 0.01 0.00

Closing balance 3.66 2.76 1.87 0.97 0.07


Repayment 0.07 0.07 0.07 0.07 0.07

Interest 0.02 0.02 0.01 0.01 0.00

Closing balance 3.59 2.69 1.79 0.90 0.00


Interest 0.30 0.25 0.18 0.11 0.04


(Rs. in lacs)



Depreciation 0.26 0.26 0.26 0.26 0.26

Interest 0.30 0.25 0.18 0.11 0.04

Total 2.66 1.88 2.24 2.22 2.19 11.19

Interest 0.30 0.25 0.18 0.11 0.04

Loan repayment 0.22 0.90 0.90 0.90 0.90

Total 0.53 1.15 1.08 1.01 0.94 4.70

DSCR 5.04 1.63 2.07 2.20 2.34

Average DSCR = 2.38


(Rs. in lacs)

Year 1 2 3


B. Variable cost


Power & fuel 0.08 0.09 0.10





Salary 1.08 1.09 1.10







G. Cash BEP 38.50% 37.74% 36.42%


(Rs. in lacs)

Year 0 1 2 3 4 5

CASH OUTFLOW


Working Capital 0.00 1.15 0.13 0.13 0.00 0.00

Total (A) 4.71 1.15 0.13 0.13 0.00 0.00

CASH INFLOW

Profit After Tax 2.09 1.36 1.79 1.84 1.89


Add: Interest 0.30 0.25 0.18 0.11 0.04

Add: Salvage Value (10%)

Total (B) 0.00 2.66 1.88 2.24 2.22 2.19

NET FLOW (B-A) -4.71 1.51 1.74 2.11 2.22 2.19

IRR = 28%

1.0 INTRODUCTION India is the largest producer of incense sticks or agarbatti in the world, with an estimated

production of 208 billion sticks annually and market value of more than INR 41.63 billion in 2008.

This amounts to over 42,000 tonnes of sticks made from nearly 85,000 tonnes of bamboo. The

sector is estimated to be growing at 20 percent annually.

Industry sources say that, at one time, about 90 percent of the bamboo sticks used in the agarbatti

industry came from Tripura, a state in the north-eastern part of India. Much of the growth in stick

production has since taken place outside the state, and now Tripura's share has come down.

A large number of women are involved in the bamboo stick-making activity. They mostly work

during the time spared from domestic chores and subsistence activities. The work brings in the

much-needed cash income that has a high opportunity cost for them even though the bamboo

sticks capture only 1 percent of the final value of agarbatti.

In the past, bamboo has been mostly obtained free of cost from the forest and hence, all the

earnings from the stick making activity belonged to the women involved. Increasingly, these

earnings are being affected by the growing scarcity of bamboo, resulting in communities having to

buy much of the bamboo used for stick making leading to reduction in net income.

Bamboo sticks are the major raw materials used in the Agarbatti industry. These are collected

through contract labour system, prevalent in the unorganized sectors. There are wide differences

in wages because of the differences in minimum wage rules that are different in different states.

For processing of bamboo, electricity operated high capacity machines are available, which are

suitable for industries but not for rural poor who make strips and sticks using knife. Looking at the

need, an innovative set of two machines i.e. Bamboo Strip Making Machine and Incense Stick

Making Machine has been developed, which are used for making incense sticks from bamboo

pieces. These machines are manually operated, easy to use and maintain and most suitable for

the tribal people. A first generation entrepreneur can set agarbatti stick making unit by installing the

machines.

This project profile is for setting up of a Bamboo Stick Making unit by use of the above mentioned

set of machines. The unit will install 5 set of the machines and will have installed capacity of

45,000 kg of sticks based on 8 working hours per day and 300 working days per annum.

2.0 MARKET POTENTIAL India has a leadership position in agarbatti production and meets more than half of the world's

incense sticks requirements. India exports Agarbatti to nearly 90 countries. Every year more than

1000 billion sticks are produced and the market is growing at a rate of 7% per year.

The incense stick market faces a sudden upsurge in demand during the festive season. Demand

from both domestic and international sectors peaks up during festivals like Dussehra and Diwali.

The market for incense sticks is vast and the demand is high even in the far-flung rural areas.

Owing to the low level of technology, production activity of agarbattis can be taken to rural areas

without much difficulty.

3.0 MANUFACTURING PROCESS The first machine (Bamboo Strip Making Machine) is used to slice the bamboo pieces of definite size and length. The slices cut are then fed in the Stick Making Machine to produce the sticks.



Particulars Amount







TOTAL 6.38

4.1 Land & Site Development: No. cost has been considered for land & site development. It is assumed that the unit will be set up in own land.



Work Shed cum store room (Brick wall, CGI sheet roof, concrete floor)

58 4500 260465


TOTAL 286511




Bamboo strip making machine 5 20000 100000

Incense stick making machine 5 20000 100000

Weighing balance (10 kg capacity) 3 800 2400


Sub total 207400

Add: Transportation, taxes, etc @ 10% 20740

TOTAL 228140






TOTAL 20000



are given below.

(Rs. In lacs)



Fees 0.20



TOTAL 0.61




(Rs. In lacs)

Period Amount (Rs)

(Days) Year 1 Year 2 Year 3


Power 30 0.01 0.01 0.01

Salary 30 0.12 0.12 0.12


Receivables 15 0.14 0.17 0.19

Total 0.43 0.48 0.53

Working Capital Margin in Yr 1 (100%) 0.43




EQUITY



DEBT


TOTAL 100% 6.38


(Rs. in lacs)


A. INCOME




Price of agarbatti stick (Rs/ kg) 15 15 15 15 15




Power 0.09 0.11 0.13 0.13 0.13

Salary 1.50 1.51 1.52 1.52 1.53








Depreciation 0.27 0.27 0.27 0.27 0.27


Net Profit 0.75 0.85 1.41 1.46 1.51



6.1 Estimation of Production Capacity: Production of bamboo sticks at installed capacity is

estimated as below.

Machine Capacity (kg/ hr of sticks) 3.75

No. of stick making machine 5

No. of working hrs/ day 8


No. of sticks per annum at installed capacity (kg) 45000



No. of sticks per annum at installed capacity (kg) 45000

Wastage during conversion from bamboo culms (%) 5%

Raw material (bamboo culms) required (kg) 47250

Average weight of individual culms (kg) 10

Quantity of bamboo culms required 4725

Price of individual bamboo culms (Rs/ kg) 25

Expenses on raw material (Rs) 118125

Add: Consumables, packing materials, etc @ 15% 17719





Miscellaeous LS LS 1.00


No. of hrs per day 8









Machine operators 5 2500 150000





(Rs. in lacs)










(Rs in lacs)





TOTAL 0.27

6.9 Interest on Term Loan & Principal Repayment: Interest rate has been assumed at 8% per

annum. Duration of Loan repayment has been considered for a period of 5 years including


given below.

(Rs in lakh)



Repayment 0.00 0.08 0.08 0.08 0.08

Interest (8%) 0.03 0.02 0.02 0.01 0.01

Closing balance 3.83 3.53 2.63 1.73 0.83


Repayment 0.00 0.08 0.08 0.08 0.08

Interest 0.03 0.02 0.02 0.01 0.01

Closing balance 3.83 3.45 2.55 1.65 0.75


Repayment 0.00 0.08 0.08 0.08 0.08

Interest 0.03 0.02 0.02 0.01 0.01

Closing balance 3.83 3.38 2.48 1.58 0.68


Repayment 0.00 0.08 0.08 0.08 0.08

Interest 0.03 0.02 0.02 0.01 0.00

Closing balance 3.83 3.30 2.40 1.50 0.60


Repayment 0.00 0.08 0.08 0.08 0.08

Interest 0.03 0.02 0.02 0.01 0.00

Closing balance 3.83 3.23 2.33 1.43 0.53


Repayment 0.00 0.08 0.08 0.08 0.08

Interest 0.03 0.02 0.02 0.01 0.00

Closing balance 3.83 3.15 2.25 1.35 0.45


Repayment 0.00 0.08 0.08 0.08 0.08

Interest 0.03 0.02 0.02 0.01 0.00

Closing balance 3.83 3.08 2.18 1.28 0.38


Repayment 0.00 0.08 0.08 0.08 0.08

Interest 0.03 0.02 0.01 0.01 0.00

Closing balance 3.83 3.00 2.10 1.20 0.30


Repayment 0.00 0.08 0.08 0.08 0.08

Interest 0.03 0.02 0.01 0.01 0.00

Closing balance 3.83 2.93 2.03 1.13 0.23


Repayment 0.08 0.08 0.08 0.08 0.08

Interest 0.03 0.02 0.01 0.01 0.00

Closing balance 3.75 2.85 1.95 1.05 0.15


Repayment 0.08 0.08 0.08 0.08 0.08

Interest 0.03 0.02 0.01 0.01 0.00

Closing balance 3.68 2.78 1.88 0.98 0.08


Repayment 0.08 0.08 0.08 0.08 0.08

Interest 0.02 0.02 0.01 0.01 0.00

Closing balance 3.60 2.70 1.80 0.90 0.00


Interest 0.30 0.26 0.18 0.11 0.04


(Rs. in lacs)



Depreciation 0.27 0.27 0.27 0.27 0.27

Interest 0.30 0.26 0.18 0.11 0.04

Total 1.32 1.38 1.86 1.84 1.82 8.22

Interest 0.30 0.26 0.18 0.11 0.04

Loan repayment 0.23 0.90 0.90 0.90 0.90

Total 0.53 1.16 1.08 1.01 0.94 4.72

DSCR 2.50 1.19 1.72 1.82 1.93

Average DSCR = 1.74


(Rs. in lacs)

Year 1 2 3


B. Variable cost


Power 0.09 0.11 0.13






Salary 1.50 1.51 1.52







G. Cash BEP 38.16% 37.53% 36.46%


(Rs. in lacs)

Year 0 1 2 3 4 5

CASH OUTFLOW


Working Capital 0.00 0.43 0.05 0.05 0.00 0.00

Total (A) 5.35 0.43 0.05 0.05 0.00 0.00

CASH INFLOW

Profit After Tax 0.75 0.85 1.41 1.46 1.51


Add: Interest 0.30 0.26 0.18 0.11 0.04


Total (B) 0.00 1.32 1.38 1.86 1.84 2.62

NET FLOW (B-A) -5.35 0.90 1.33 1.81 1.84 2.62

IRR = 15%

1.0 INTRODUCTION Charcoal made from bamboo finds ready uses and markets. It has been made for thousands of

years in pits and even shallow depressions. Specially designed brick kilns, developed and tested

by the National Mission on Bamboo Applications (NMBA), provide an opportunity to make high-

quality charcoal from bamboo in an efficient, safe and reliable manner.

Charcoal is a product with many uses, in industry and in the domestic sector. It is utilised:

at the village level, by blacksmiths and to meet household energy requirements;

in the domestic sector, as fuel for cooking and heating;

in the service sector, by dhobis and in dhabas;

in the industrial sector, at different scales of activity, in furnaces, for forging and metal-

working;

as raw material for further processing into activated carbon and other industrial products.

Charcoal made from bamboo has good properties, similar to wood and other ligno-cellulosic

material in terms of high carbon content and calorific value.

Charcoal is produced by heating biomass with a controlled supply of air. This can be done by the

conventional pit method, in brick or metal kilns, or in drums. Heating can be direct by igniting the

biomass or it can be indirect. Carbonisation in a brick kiln produces uniform-quality charcoal with

good yield and low investment.

2.0 RAW MATERIAL

Any species of bamboo can be used for making charcoal.

4–5-year-old bamboo makes the best charcoal. It has by then attained its maximum bio-

mass, and its moisture and starch levels have lowered.

To get the best yield of charcoal, the moisture content of bamboo should be around 20 to 25

per cent. In the monsoon or other rainy periods, bamboo will have higher moisture content.

At such times, the bamboo should be left to dry for some time before conversion to charcoal.

(For large-scale operations, dryers can be used to bring down the moisture levels.)

In many applications, the upper and lower portions of bamboo culms are not used, and are

often thrown away. These can be used in charcoal-making. Lops and tops of bamboo culms

and thicker branches can be used too. Processed waste from stick and sliver units consists

of a large amount of particulate matter. Such particulate matter cannot be used in these kilns

to make charcoal.

3.0 KILN STRUCTURE The kiln is hemispherically shaped and has a diameter of 3 metres, made of clay bricks, mud and mortar. It has a rectangular opening at the bottom. Through this opening, raw bamboo is loaded into the kiln. After conversion, charcoal is taken out through the same opening. The capacity of the Kiln is 2.5–3.5 tons while the volume cacity is 14 cubic metres.

4.0 OPERATION Step 1: Sizing of Bamboo

Sizing of bamboo is the first step. The size of the end-product (charcoal) is related to the size of the bamboo placed in the kiln.

Whole bamboo culms will need to be cut to the required size. If the bamboo section is too large, it will not fit into the kiln. The maximum length of any section should be 2.5 metres. The minimum acceptable size is 5 centimetres.

Homogeneity of size in a batch will make stacking easier and produce better results.

For every batch, a small quantity of bamboo will need to be sized between 10 and 12 centimetres; this will help in kindling the material.

Step 2: Charging of the Feed

Place the bamboo in the kiln through the door at the bottom. Stack the bamboo horizontally in the kiln.

Close the door with bricks, and plaster the outer face of the door with mud to provide better insulation and prevent leakage.

Fire the feed from the opening at the top of the kiln.

Close the opening at the top of the kiln after the feed has been ignited.

The openings in the wall of the kiln should be kept open during the initial stages of firing to create the required draft.

Initially, black smoke will be emitted from the openings in the wall at the upper end. The emission of smoke will gradually spread to the openings at the lower end of the kiln.

Close the openings in the top rows once the black smoke changes to dense white fumes.

Close all the openings one by one starting at the top row as the black smoke changes colour. Step 3: Carbonisation

Initially regulate a few openings (open/close) across the kiln in both horizontal and vertical directions, to create a draft and enable uniform carbonisation.

In case a temperature sensor is available, maintain the temperature at 400–550o centigrade by regulating the openings. The temperature should not be allowed to drop below 350o centigrade as this will lead to incomplete carbonisation. The temperature should not rise above 500o centigrade as this will cause the biomass to burn and provide ash instead of charcoal.

In case a sensor is not available, estimate the temperature. Over time, workers will acquire the necessary skills and experience to regulate the openings even without the use of sensors.

Step 4: Cooling

Close all openings after 2 days.

Do not allow air to enter the kiln at this juncture to prevent the charcoal from catching fire.

Cooling will take a day. The objective is to reduce the kiln temperature to 100o centigrade to allow the charcoal to be safely extracted.

Step 5: Extraction of charcoal

Break through the opening at the bottom of the kiln.

In case the char is too hot to handle, sprinkle a small quantity of water. Excessive watering will lower the quality of the charcoal.

Remove the charcoal carefully to a storage point for disposal. Step 6: Cleaning

Clean the kiln of charcoal and residues.



Particulars Amount


Construction of Kilns 2.50

Miscellaneous Assets 0.20



TOTAL 7.35

5.1 Land & Site Development: No cost has been considered for land & site development. It is assumed that the unit will be set up in own land.

5.2 Construction of Kilns: Details of construction of kilns are given below.


Kilns (3000 kg capacity, made with clay bricks, mud and mortar)

10 25000 250000

TOTAL 250000


5.3 Miscellaneous Assets: Details of miscellaneous assets are given below.


Implements LS LS 15000


TOTAL 20000



are given below.

(Rs. In lacs)



Fees 0.10



TOTAL 0.38


(Rs. In lacs)

Period (Months)

Amount (Rs)

Yr 1 Yr 2 Yr 3


Salary 1 0.20 0.20 0.20


Receivables 1 1.50 1.80 2.10

Total 4.27 5.04 5.81





EQUITY



DEBT


TOTAL 100% 7.35


(Rs. in lacs)


A. INCOME




Price/ kg of charcoal (Rs) 10 10 10 10 10




Salary 2.40 2.40 2.40 2.40 2.40







Depreciation 0.10 0.10 0.10 0.10 0.10


Net Profit 0.79 1.57 2.37 2.43 2.49



7.1 Estimation of Production Capacity: Production of bamboo charcoal at installed capacity is

estimated as below.

Capacity of kilns (kg/ batch of raw material) 3000

Charcoal yield (%) 25%

Yield of charcoal/ batch/ kiln (kg) 750

Batches/ month 4

Months/ annum 12

Production of charcoal/ kiln/ annum 36000

No. of kilns 10

Production of charcoal per annum at installed capacity (kg) 360000



Raw material (bamboo) required/ batch (kg) 3000

Batches/ month 4

Months/ annum 12

No. of kilns 10

Quantity of bamboo required/ annum (kg) 1440000

Average weight of individual bamboo culms (kg) 10

Quantity of bamboo culms required 144000

Price of individual bamboo culms in situ (Rs) 15

Expenses on raw material at 100% capacity (Rs) 2160000

Add: Consumables, transportation, etc @ 25% 648000





Kiln operators 4 5000 240000

Expenses on salary per annum (Rs) 240000




(Rs. in lacs)


Kilns 2.50 2% 0.05

Miscellaneous Assets 0.20 3% 0.01






(Rs in lacs)


Kilns 2.50 3.34% 0.08

Miscellaneous Assets 0.20 7.07% 0.01

TOTAL 0.10

7.8 Interest on Term Loan & Principal Repayment: Interest rate has been assumed at 8% per

annum. Duration of Loan repayment has been considered for a period of 5 years including


given below.

(Rs in lakh)



Repayment 0.00 0.09 0.09 0.09 0.09

Interest (8%) 0.03 0.03 0.02 0.01 0.01

Closing balance 4.41 4.07 3.03 1.99 0.95


Repayment 0.00 0.09 0.09 0.09 0.09

Interest 0.03 0.03 0.02 0.01 0.01

Closing balance 4.41 3.98 2.94 1.90 0.86


Repayment 0.00 0.09 0.09 0.09 0.09

Interest 0.03 0.03 0.02 0.01 0.01

Closing balance 4.41 3.89 2.85 1.82 0.78


Repayment 0.00 0.09 0.09 0.09 0.09

Interest 0.03 0.03 0.02 0.01 0.01

Closing balance 4.41 3.81 2.77 1.73 0.69


Repayment 0.00 0.09 0.09 0.09 0.09

Interest 0.03 0.03 0.02 0.01 0.00

Closing balance 4.41 3.72 2.68 1.64 0.61


Repayment 0.00 0.09 0.09 0.09 0.09

Interest 0.03 0.02 0.02 0.01 0.00

Closing balance 4.41 3.63 2.59 1.56 0.52


Repayment 0.00 0.09 0.09 0.09 0.09

Interest 0.03 0.02 0.02 0.01 0.00

Closing balance 4.41 3.55 2.51 1.47 0.43


Repayment 0.00 0.09 0.09 0.09 0.09

Interest 0.03 0.02 0.02 0.01 0.00

Closing balance 4.41 3.46 2.42 1.38 0.35


Repayment 0.00 0.09 0.09 0.09 0.09

Interest 0.03 0.02 0.02 0.01 0.00

Closing balance 4.41 3.37 2.34 1.30 0.26


Repayment 0.09 0.09 0.09 0.09 0.09

Interest 0.03 0.02 0.02 0.01 0.00

Closing balance 4.32 3.29 2.25 1.21 0.17


Repayment 0.09 0.09 0.09 0.09 0.09

Interest 0.03 0.02 0.01 0.01 0.00

Closing balance 4.24 3.20 2.16 1.12 0.09


Repayment 0.09 0.09 0.09 0.09 0.09

Interest 0.03 0.02 0.01 0.01 0.00

Closing balance 4.15 3.11 2.08 1.04 0.00


Interest 0.35 0.29 0.21 0.13 0.04


(Rs. in lacs)



Depreciation 0.10 0.10 0.10 0.10 0.10

Interest 0.35 0.29 0.21 0.13 0.04

Total 1.23 1.96 2.68 2.66 2.63 11.16

Interest 0.35 0.29 0.21 0.13 0.04

Loan repayment 0.26 1.04 1.04 1.04 1.04

Total 0.61 1.33 1.25 1.17 1.08 5.44

DSCR 2.02 1.47 2.14 2.28 2.43

Average DSCR = 2.05


(Rs. in lacs)

Year 1 2 3


B. Variable cost







Salary 2.40 2.40 2.40







G. Cash BEP 38.04% 37.45% 36.57%


(Rs. in lacs)

Year 0 1 2 3 4 5

CASH OUTFLOW


Working Capital 0.00 4.27 0.77 0.77 0.00 0.00

Total (A) 2.70 4.27 0.77 0.00 0.00 0.00

CASH INFLOW

Profit After Tax 0.79 1.57 2.37 2.43 2.49


Add: Interest 0.35 0.29 0.21 0.13 0.04

Add: Salvage Value

Total (B) 0.00 1.23 1.96 2.68 2.66 2.63

NET FLOW (B-A) -2.70 -3.03 1.18 2.68 2.66 2.63

IRR = 16%

project profilevol 1

Documents

sub total

miscellaneous expenses

particulars qty rate

miscellaneous items

details of equipments

particulars area rm

particulars area sqm

details of working capital