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Project Appraisal & Financing
Business Idea: FLY ASH BRICKS
2
INTRODUCTION 3 MARKET DEMAND: ............................................................................................................................. 4
Why fly ash bricks? ............................................................................................................................. 4
Technical Specifications ...................................................................................................................... 4
Demand potential estimate ................................................................................................................ 5
Supply status: ...................................................................................................................................... 5
Scope of the project: ........................................................................................................................... 5
Acquiring the raw materials: ............................................................................................................... 6
Economic concerns: ............................................................................................................................ 6
Product pricing .................................................................................................................................... 6
Promotional plans: .............................................................................................................................. 6
Marketing plans .................................................................................................................................. 6
STP:...................................................................................................................................................... 6
Country Scenario ................................................................................................................................. 7
Steps involved ..................................................................................................................................... 8
Equipment Suppliers ........................................................................................................................... 8
Raw Materials & Utilities .................................................................................................................... 8
Manpower Requirements ................................................................................................................... 8
Location & Infrastructure .................................................................................................................... 8
Implementation .................................................................................................................................. 9
SOURCES: ................................................................................................................................................ 9
PAF FINAL RANK 1 IDEAS OF OUR TEAM .............................................................................................. 10
Reasons for Selecting Fly Ash Bricks ................................................................................................. 10
Reasons for Not Selecting Others ..................................................................................................... 10
LIST OF ASSUMPTIONS .......................................................................................................................... 11
FEASIBILITY STUDY ................................................................................................................................ 12
Estimation of Installed Capacity........................................................................................................ 12
Raw Materials for Product 1 ............................................................................................................. 13
Production and Sales Realization ...................................................................................................... 13
Salary and Wages .............................................................................................................................. 13
Miscellaneous Fixed Assets ............................................................................................................... 14
Preliminary and Preoperative Expenses ........................................................................................... 14
Depreciation ...................................................................................................................................... 14
Assumption for Estimated Cost of Production ................................................................................. 15
Project Cost Estimation ..................................................................................................................... 15
3
Profitability Statement ...................................................................................................................... 16
Break Even Point ............................................................................................................................... 17
Working Capital Calculation .............................................................................................................. 18
Debt Service Coverage Ratio ............................................................................................................. 19
INTRODUCTION
Fly Ash bricks are made of fly ash, lime, gypsum and sand. These can be extensively
used in all building constructional activities similar to that of common burnt clay bricks. The
4
fly ash bricks are comparatively lighter in weight and stronger than common clay bricks.
Since fly ash is being accumulated as waste material in large quantity near thermal power
plants and creating serious environmental pollution problems, its utilization as main raw
material in the manufacture of bricks will not only create ample opportunities for its proper
and useful disposal but also help in environmental pollution control to a greater extent in the
surrounding areas of power plants. In view of superior quality and eco-friendly nature, and
government support the demand for Fly Ash Bricks has picked up.
MARKET DEMAND:
180 billion tons of common burnt clay bricks are consumed annually approximately
340 billion tons of clay- about 5000 acres of top layer of soil dug out for bricks manufacture,
soil erosion, emission from coal burning or fire woods which causes deforestation are the
serious problems posed by brick industry. The above problems can be reduced some extent
by using fly ash bricks in dwelling units. Demand for dwelling units likely to raise to 80
million units by year 2015 for lower middle and low income groups, involving an estimated
investment 0f $670 billion, according to the associated chamber of commerce and industry.
Demand for dwelling units will further grow to 90 million by 2020, which would require a
minimum investment of $890billion. The Indian housing sector at present faces a shortage of
20million dwelling units for its lower middle and low income groups which will witness a
spurt of about 22.5million dwelling units by the end of Tenth plan period. There is ample
scope for fly ash brick and block units... But good quality of bricks as well as required
quantity is not available moreover during the Rainey seasons supply of clay bricks are very
difficult. Therefore, in order to fulfill the required demand there will be a great chance to start
more units in the field of fly ash bricks. At present 20nos units are engaged and 40 lakhs no’s
of bricks per month are manufactured in our state. And there will be scope to start near about
100 units, which will be produced more than 2 cores no of bricks per month in future. Thus
marketing of these product are well shinning.
Why fly ash bricks?
Fly ash bricks are can be used as an alternative to burnt clay bricks. These are
environment friendly cost saving building products. These are 3 times stronger than
conventional bricks with consistent strength. These are ideally suited for internal, external,
load bearing and non-load bearing walls. These bricks with higher strength /weight ratio
(about 3 to 4 times that of burnt clay bricks) aid in designing stronger yet more economic
structures. Fly ash bricks are durable, have low water absorption, less consumption of mortar,
economical &ecofriendly, low energy consumption and no emission of greenhouse gases.
These bricks are not affected by environmental conditions and remain static thus ensuring
longer life of the building. Also the savings with regard to wastages in fly ash bricks are
considerable during unloading and construction due to true shape and size, consistency in
quality and the workability of the fly ash bricks unlike traditional clay bricks. These bricks
are very economical / cost effective.
Technical Specifications
Sizes available :230x110x70 mm
5
Raw Material Used : fly ash, sand, grit, cement
Uses : constructions of walls
Colors & packaging available : light grey, minimum 1 load truck can be delivered
Demand potential estimate
The construction industry contributes to about 10 % of the Gross Domestic Product
(GDP), registering an annual growth of about 9 %. Clay fired bricks form the backbone of the
construction industry which is valued at approximately US$ 70.8 billion. The brick sector in
India, although unorganized, is tremendous in size and spread. India is the second largest
brick producer (China dominates with 54 % share) in the world. It is continuously expanding
on account of a rapid increase in demand for bricks in infrastructure and housing industries.
In order to meet this demand, over 150,000 brick units provide direct employment to more
than 8 million workers. During the Ninth Five-year Plan period (1997-2002), the annual
demand of 170 million bricks per year was estimated to be generating revenues of over US$
4.8 billion.
Supply status:
Raw materials required for making of fly ash bricks are fly ash, lime and gypsum. Fly
ash can be procured from thermal power plants. Lime and gypsum are available in the market
and can be bought as per the requirement
The need for clay ash bricks:
1) The bricks we currently use made up of specific quality of top soil( app 10000 hc of
top soil is lost every year for brick manufacturing)
2) If the top soil consumption carries on at the same pace, very soon, we will not have
enough soil for the cultivation.
3) The thermal power plants and the industrial units using coal as a fuel have no use with
the fly ash left after the combustion
Scope of the project:
1) Nearly 75 % of India’s total installed power generation capacity is thermal, of which
coal based generation is 90%, the remaining comprising of diesel and gas.
2) The 85 utility thermal power plants use coal and producing large quantities of fly ash.
Features:
1) Size of the bricks will be 230 x 110 x 76 mm
2) Less mortar consumption
3) Ash content as high as 60%
4) Faster construction
6
Acquiring the raw materials:
1) Fly ash is readily available with thermal power plants and can be acquired from them
even without spending on transportation
2) Lime, gypsum and sand are available in the market and can be purchased as per the
requirement.
Economic concerns:
1) Currently the demand for bricks is very high from the supply
2) Demand and supply gap is around 270 billion bricks per annum
3) In India the annual production of fly ash can result in manufacturing 790 billion
bricks
4) To reduce the demand and supply gap we will need to expand in this sector at a larger
rate than what is undergoing at the present time.
Product pricing
1) Penetration price of Rs.5.00 per brick for the first two years and then concession to
high end buyers at a rate of 5%
Promotional plans:
1. Discounts on large buying
2. Large volume of institutional sales
3. Aggressive selling
4. Trade promotion
5. Publicity
Marketing plans
1) The government has imposed rules for the use of 100% fly ash bricks in a radius of
100 mms from thermal power plants. However, the government is itself not implying
to the norms. The govt. can be forced to imply to such norms by NGOs and when
such a scenario occurs, the demand for the bricks from the side of the govt. will
increase many folds.
2) Use of these bricks result savings of almost 37% in the construction cost.
STP:
Segmentation: We will first try to capture the local markets and then we will move to the
neighboring states.
Positioning: It can be positioned as environmental pollutant cleaner.
Targeting: Builders, consultants, architects, government
7
Study revealed that out of the different building blocks existing in the market, burnt
clay bricks account for more than 95% of the total market for walling material in larger parts
of the country.Q
Type of Walling material Market Size % of Total market
(Rs Crore)
Burnt Clay Bricks 32825 95.3%
Cement Concrete blocks 1135 3.3%
Fly ash bricks 485 1.4%
Fly ash: Fly ash is the major raw material used in the manufacturing of burnt clay
bricks. The availability of the raw material is described as follows:
Andhra Pradesh Scenario
1) The current utilization of Fly ash in the state in tune of 36.9 % of total fly ash
generated from all of its thermal power stations
2) The fly ash utilization in Andhra Pradesh in 2005-06 is around 46% which is
increased to 60% in 2014
Country Scenario
a) In accordance to Central Electricity Authority, an amount of 130.7million tons of fly
ash is generated from the coal based thermal power plants. However the total
utilization of fly ash is only 72.8 million tons (i.e. 56%) of which 35.2 million tons
(i.e. 27% of total fly ash) were consumed by the cement industry. The other users
included Brick Manufacturers 4.59 million tons (3.5%), Roads, Embankment and Ash
Dykes 8.52 million tons (6.5%), Reclamation and Mine-filling 15.19 million tons
(11.5%), and other misc. applications 9.34 million (7%). Balance 57.90 million tons
which is about 44% of the total fly ash remained unutilized12.
b) Paper Published in Journal of scientific and industrial research13refers to “tick” report
that refers to a total ash utilization of 38% In India
c) Publication by Department of Science and Technology outlined the availability of fly
Ash as below
1. The utilization of fly ash during 1993-94 was one million tons only as against a
generation of 40 million tons.
2. Fly ash utilization rose to 60 million tons during the year 2006-07 in compared to
fly ash generation in the country of 130 million tons per year.
3. The quantum of un-utilized fly ash has also increased from 39 million tons per year
to 100 million tonne per year in 2006-2007.
8
TECHNICAL REQUIREMENTS
Steps involved
1) Collection of Different clay and Flash.
2) Mixing and preparation of clay-flash mix.
3) Preparation of Bricks through moulds.
4) Drying of Bricks.
5) Filling of Kiln.
6) Burning of Bhatta.
7) Cooling of Bhatta.
8) Empty & Refilling of Bhatta.
9) Inspection and sorting of Bricks according to grades.
10) Dispatch.
Equipment Suppliers
Benny Enterprise, Coimbatore, Tamil Nadu
Shri Engineering Enterprises, Pune
Shree Hari Engineering, Ahmedabad, Gujarat
Columbia-Pakona Engineering Pvt. Ltd., Mumbai
Concept Tech-Know Equipment Pvt. Ltd., Maharashtra, Pune
Raw Materials & Utilities
->From Thermal power station & local suppliers of lime etc
->Fly ash, Lime, Gypsum, Sand and down metal
Manpower Requirements
->12-14 people/shift
Location & Infrastructure
Technically advanced manufacturing unit with modern technology. The
manufacturing unit is well equipped with high end latest machinery, Computerized Design
Unit, Laboratory, Conference Hall for arranging business meet, technology based meet to
promote and/or training for ecofriendly product. Highly experienced and diligent team of
experts who assists offer high quality products. Research and Development team is remain
connect with global market. The products are continuous update with innovative latest
technologies. Professionals have expertise in all areas and can fully support our equipment,
9
providing parts, service, installation and training to Indian and global customers. We are
planning to establish this plant near NTPC/ Ramagundam, Karimnagar
Implementation
->6-8 Weeks
SOURCES:
http://www.taramachines.com/Tara-fly-ash.aspx
http://www.ecobrick.in/resource_data/KBAS100082.pdf
http://www.bmtpc.org/DataFiles/CMS/file/01_Flyash_Brick1.pdf
http://nstfdc.nic.in/userfiles/fly_ash_bricks.pdf
http://www.dsir.gov.in/reports/ExpTechTNKL/Abs%20new/Engineers.htm
10
PAF FINAL RANK 1 IDEAS OF OUR TEAM
HARI HARSHA SHAKEER HARESH SUDHEERA
SAIR
AM
FACTORS
WEIGHT
(R1)RAIN
WATER
HARVEST
ING TOOL
KIT
R1(PETR
OL
BUNKS)
(R1) FLY
ASH
BRICKS
R1(SCHOOL
CHILDRENS
CULTURAL
ACTIVITIES
)
R1 (ORGANIC
GARDEN
CARE
BUSINESS)
(R1)
ORGA
NIC
FARMI
NG
CAPITAL
REQUIREMENT 25% 4 1 3 4 1 1
DEMAND 20% 3 3 4 3 2 2 COMPETITORS
AVAILABILITY 10% 3 2 5 3 3 3 LAND,
BUILDING,
MACHINERY
AVAILABILITY 15% 2 1
3
3 2 2 POLITICAL
REFERENCE 10% 4 2 4 4 4 4
ECO-FRIENDLY 20% 5 3 5 4 5 5
TOTAL 100% 3.6 2 3.9 3.55 2.65 2.65
Reasons for Selecting Fly Ash Bricks
1. The total score is high i.e. 3.9.
2. Change in Govt. is supporting make in India which encourages infrastructure.
3. It is environment friendly.
4. High demand for bricks.
5. High availability of labor.
Reasons for Not Selecting Others
1. RAIN WATER HARVESTING - It can be copied easily and its usage period is limited
only to rainy season.
2. PETROL BUNKS- It needs high political reference.
3. ORGANIC GARDEN CARE BUSINESS- Target audiences are very less.
4. ORGANIC FARMING- Its break even duration is very high & low productivity.
5. SCHOOL CHILDRENS CULTURAL ACTIVITIES- High care should be taken
because it is a matter about children.
11
LIST OF ASSUMPTIONS
(Amount in Rupees)
ESTIMATION OF INSTALLED CAPACITY
1 production Unit 1000 /Hr.
2 No of hrs. per day 8 /Hr.
3 No. Of working Days per year 300 /Day
4 No of Shift 1
production per year 2,400,000 units
RAW MATERIALS FOR PRODUCT 1
Details of Raw material Quantity (MT) Rate(5% increase
every year)
1 Fly Ash 420 500
2 Gypsum Lime 70 2000
3 Lime 105 1500
4 Sand 35 1000
Total 630 5000
PRODUCTION AND SALES RELIASATION
Details
Name of the products Demand(UNITS) selling price per
unit(5% Increase YoY)
Fly ash brick 2,000,000 Rs 5.00
Annual sales 10,000,000.00
SALARY AND WAGES
Designation Number Salary/Month
1 Production manager 1 25,000
2 Un Skilled Workers(8000*25) 25 200,000
3 office assistant 1 12,000
4 Watch man 1 8,000
Total 53,000
MISCELLANEOUS FIXED ASSETS
S.No Amount
Office Equipment’s 30000
Telephone Etc. 1200
Furniture 35000
Computer 20000
Printers 5000
Fire Fighting Equipment’s 2000
Total 93200
PRELIMINARY AND PREOPERATIVE
EXPENSES
Details Amount
1 Project report preparation 30,000
2 Sal. During construction % Age of Sal. 120,000
12
3 Trial runs (2 Days) 5,000
4 Travelling 5,000
5 Deposits 20,000
6 Application processing Fees 5,000
7 Misc.…….
Total 185,000
DEPRECIATION (SLM)
1 20% ON BUILDING
2 20% ON PLANT & MACHINERY
3 10% ON FIXED ASSETS
ASSUMPTION FOR ESTIMATING COST OF
PRODUCTION
Details Basis
1 Consumables 1% of sales 84000
2 Repairs and maintenance 2%, 3%, 4% of
P/M
36400
3 Rent, rates and taxes Rs. Per month 1000
4 Interest on term loan 12% of term loan 480000
5 Interest on working capital loan
6 selling & Administration exp. 1% of sales 100000
7 Misc. Expenses 1% of sales 100000
8 Rate of taxation 30% of Net Profit
FEASIBILITY STUDY
Estimation of Installed Capacity
Sr. No Estimation of installed
capacity
1 production Unit 1000 /Hr.
2 No of hrs. per day 8 /Hr.
3 No. Of working Days per
year
300 /Day
4 No of Shift 1
production per year 2,400,000 units
13
Raw Materials for Product 1
Sr. No
Details
of raw
material
Quantity
(MT)
Rate(5%
increase
every
year) 1st 2nd 3rd 4th 5th
1 Fly Ash 420 500
210,000 220500 231525 243101 255256
2
Gypsum
Lime 70 2000
140,000 147000 154350 162068 170171
3 Lime 105 1500
157,500 165375 173643.75 182326 191442
4 Sand 35 1000
35,000 36750 38587.5 40517 42543
Total 630
542,500
569,625
598,106 628012 659412
Production and Sales Realization
Details
Sales
realization
Name of
the
products
Demand
(UNITS)
selling
price per
unit 1 year 2 year 3 year 4 year 5 year
Fly ash
brick 2,000,000 Rs 5.00 5 5.25 5.775 6.3525 6.98775
Annual
sales
10,000,000 10,500,000 11,550,000 12,127,500 12,733,875
Salary and Wages
Salaries and Wages increases
5% from 3rd year
Designation Number
Salary
/Month
Annual
Sal 1 year 2 year 3 year 4 year 5 year
Production
manager 1
25,000
300,000
300,000
300,000
315,000
330,750
347,288
Un Skilled
Workers 25
8,000
2,400,000
2,400,000
2,400,000
2,520,000
2,646,000
2,778,300
office
assistant 1
12,000
144,000
144,000
144,000
151,200
158,760
166,698
Watch man 1
8,000
96,000
96,000
96,000
100,800
105,840
111,132
Total
53,000
2,940,000
2,940,000
2,940,000
3,087,000
3,241,350
3,403,418
14
S.No Final Salaries Year 1 Year 2 Year 3 Year 4 Year 5
1 Total Salary 2,940,000 2,940,000 3087000 3241350 3403418
2 % annual increase 5% 0 0 147,000 154,350 162,068
Miscellaneous Fixed Assets
Miscellaneous Fixed Assets
S.No Amount
Office Equipment’s 30000
Telephone Etc. 1200
Furniture 35000
Computer 20000
Printers 5000
Fire Fighting Equipment’s 2000
Total 93200
Preliminary and Preoperative Expenses
Preliminary and preoperative Expenses
S.No Details Amount
1 Project report preparation 30,000
2 Sal. During construction % Age of Sal 120,000
3 Trial runs (2 Days) 5,000
4 Travelling 5,000
5 Deposits 20,000
6 Application processing Fees 5,000
7 Misc.…….
Total 185,000
Depreciation
Calculation for
Depreciation 1 2 3 4 5
Building
opening Balance - 800,000 600,000 400,000 200,000
Original cost of Acquisition 1,000,000
Dep@20% 200,000 200,000 200,000 200,000 200,000
SLM 800,000 600,000 400,000 200,000 -
15
Calculation for
Depreciation 1 2 3 4 5
Plant & machinery
opening Balance - 1,456,000 1,092,000 1,928,000 1,264,000
Original cost of Acquisition 1,820,000
1,500,000
Dep@20% 364,000 364,000 664,000 664,000 664,000
SLM 1,456,000 1,092,000 1,928,000 1,264,000 600,000
Calculation for Depreciation 1 2 3 4 5
Misc. Fixed Assets
opening Balance - 83,880 74,560 65,240 55,920
Original cost of Acquisition 93200
Dep@10% 9,320 9,320 9,320 9,320 9,320
SLM 83,880 74,560 65,240 55,920 46,600
Total 573,320 573,320 873,320 873,320 873,320
Assumption for Estimated Cost of Production
Details Basis 1 2 3 4 5
Consumables 1% of sales 84000 107100 249480 274428 301871
Repairs and maintenance
2%, 3%, 4% of
P/M 36400 54600 72800 72800 72800
Rent, rates and taxes Rs. Per month 1000 1100 1210 1331 1464
Interest on term loan 12% of term loan 480000 384000 288000 192000 96000
Interest on working capital
loan 12% of W C Loan 45383 53180 104132 113471 123707
selling & Administration exp. 1% of sales 100000 107100 249480 274428 301871
Misc. Expenses 1% of sales 100000 105000 115500 121275 127339
Rate of taxation 30% of Net Profit 763643 1252225 4117353 4614714 5161737
Project Cost Estimation
Assets
ESTIMATED
Project Cost 1 YEAR 2 YEAR 3 YEAR 4 YEAR 5 YEAR
Land 2,500,000
2,500,000
2,500,000
2,500,000
2,500,000
2,500,000
Building 1,000,000 800000 600000 400000 200000 0
Plant & Machinery 1,820,000 1456000 1092000 1928000 1264000 600000
working Capital
25% margin 126,063 126063 147723 289255 315197 343630
Misc. Fixed assets 93,200 83880 74560 65240 55920 46600
504,254 590,892 1,157,022 1,260,788 1,374,522
Pre & Preoperative
Expenses 185,000 185,000
16
Cash 275,737
3,268,471
4,812,076
12,652,758
14,332,065
16,171,930
Total 6,000,000
8,923,668
9,817,251
18,992,275
19,927,971
21,036,682
Liability
Promoters
contribution 2,000,000.00
2,000,000
2,000,000
2,000,000
2,000,000
2,000,000
Reserves and
surplus 2545478 4174082 13724509 15382379 17205791
Term loan 4,000,000.00
4,000,000
3,200,000
2,400,000
1,600,000
800,000
Working Capital
loan
378,190
443,169
867,766
945,591
1,030,891
Balancing figure
TOTAL 6,000,000
8,923,668
9,817,251
18,992,275
19,927,971
21,036,682
Profitability Statement
Sr.
No. Unit 1 year 2 year 3 year 4 year 5 year
1 Installed capacity
2,400,000
2,400,000
4,800,000
4,800,000
4,800,000
2 Capacity utilization 70% 85% 90% 90% 90%
3 Actual production
1,680,000
2,040,000
4,320,000
4,320,000
4,320,000
4 Selling price
5
5.25
5.78
6.35
6.99
5 Total Sales
8,400,000
10,710,000
24,948,000
27,442,800
30,187,080
COST OF
PRODUCTION
A Production cost 1 year 2 year 3 year 4 year 5 year
1 Raw Materials
542,500
569,625
598,106
628,012
659,412
2
Supplies &
consumables
84,000
107,100
249,480
274,428
301,871
3 Fuel & Power
30,000
30,000
30,000
30,000
30,000
4
Repair &
Maintenance
36,400
54,600
72,800
72,800
72,800
5 Wages & Salaries
2,940,000
2,940,000
3,087,000
3,241,350
3,403,418
6 Rent, rates and taxes
12,000
13,200
14,520
15,972
17,569
7 Depreciation
573,320
573,320
873,320
873,320
873,320
TOTAL
4,218,220
4,287,845
4,925,226
5,135,882
5,358,390
17
B Financial Exp.
8
Int. on term loan
(12%)
480,000
384,000
288,000
192,000
96,000
9
Int. on working
capital (12%)
45,383
53,180
104,132
113,471
123,707
C
Selling &
Administration exp. 20000 22000 24200 26620 29282
TOTAL COST OF
PRODUCTION
4,763,603
4,747,025
5,341,558
5,467,973
5,607,379
SR.
NO
1 Operating profit
4,755,100
6,995,475
20,896,094
23,180,238
25,702,010
2
Operating profit after
Dep.
4,181,780
6,422,155
20,022,774
22,306,918
24,828,690
3 Taxable income
3,636,397
5,962,975
19,606,442
21,974,827
24,579,701
4 Income tax (30%)
1,090,919
1,788,892
5,881,933
6,592,448
7,373,910
5 net profit
2,545,478
4,174,082
13,724,509
15,382,379
17,205,791
6
operating profit /
Sales %age 57% 65% 84% 84% 85%
7
net profit / Sales
%age 30% 39% 55% 56% 57%
Break Even Point
1 YEAR 2 YEAR 3 YEAR 4 YEAR 5 YEAR
1 Sales
8,400,000
10,710,000
24,948,000
27,442,800
30,187,080
2 Variables expenses
Raw materials
542,500
569,625
598,106
628,012
659,412
Consumables
84,000
107,100
249,480
274,428
301,871
Salaries & wages
2,940,000
2,940,000
3,087,000
3,241,350
3,403,418
Interest on WC loan
45,383
53,180
104,132
113,471
123,707
Selling exp.
20,000
22,000
24,200
26,620
29,282
TOTAL
3,631,883
3,691,905
4,062,918
4,283,881
4,517,689
3 Contribution
4,768,117
7,018,095
20,885,082
23,158,919
25,669,391
18
4 Fixed
cost/Expenses
Repair &
Maintenance
36,400
54,600
72,800
72,800
72,800
Wages & Salaries
2,940,000
2,940,000
3,087,000
3,241,350
3,403,418
Rent, rates and taxes
12,000
13,200
14,520
15,972
17,569
Depreciation
573,320
573,320
873,320
873,320
873,320
Int. on term loan
480,000
384,000
288,000
192,000
96,000
Int. on working
capital
45,383
53,180
104,132
113,471
123,707
Selling &
Administration exp.
20,000
22,000
24,200
26,620
29,282
GROSS PROFIT
661,014
2,977,794
16,421,110
18,623,387
21,053,295
P/V Ratio 57% 66% 84% 84% 85%
BEP
1,164,510
4,544,279
19,615,620.99
22,068,295
24,758,574
BEP % of Sales 14% 42% 79% 80% 82%
Working Capital Calculation
1.CURRENT ASSETS 1 YEAR 2 YEAR 3 YEAR 4 YEAR 5 YEAR
Raw materials 1.5months
67,813
71,203
74,763
78,501
82,427
Work-in-progress 1/2 week
40,560
41,229
47,358
49,383
51,523
Finished Goods
1/2
months
175,759
178,660
205,218
213,995
223,266
Sundry Debtors 15 days
345,205
440,137
1,025,260
1,127,786
1,240,565
TOTAL CURRENT
ASSETS
629,337
731,230
1,352,599
1,469,666
1,597,781
2. CURRENT
LIABLITIES
Creditors 2 month
104,417
112,788
141,264
150,407
160,214
Fuel & Power 2%
600
600
600
600
600
Repair & Maintenance 2 months
6,067
9,100
12,133
12,133
12,133
Supplies & consumables 2 month
14,000
17,850
41,580
45,738
50,312
19
TOTAL CURRENT
LIABILITIES
125,083
140,338
195,578
208,878
223,259
3. WORKING
CAPITAL GAP
504,254
590,892
1,157,022
1,260,788
1,374,522
4. MARGIN ON
WORKING CAPITAL
(25% OF 3.)
126,063
147,723
289,255
315,197
343,630
5. BANK
BORROWINGS (3. - 4.)
378,190
443,169
867,766
945,591
1,030,891
Debt Service Coverage Ratio
SR.
NO. Particulars 1 YEAR 2 YEAR 3 YEAR 4 YEAR 5 YEAR
1 Net profit after tax
2,545,478
4,174,082
13,724,509
15,382,379
17,205,791
2 Interest
525,383
437,180
392,132
305,471
219,707
3 Income tax (30%)
1,090,919
1,788,892
5,881,933
6,592,448
7,373,910
TOTAL
4,161,780
6,400,155
19,998,574
22,280,298
24,799,408
INTEREST +
INSTALLMENTS
4,000,000
3,200,000
2,400,000
1,600,000
800,000
1 Installment
800,000
800,000
800,000
800,000
800,000
2 Interest
480,000
384,000
288,000
192,000
96,000
3 Working cap. Int.
45,383
53,180
104,132
113,471
123,707
TOTAL
1,325,383
1,237,180
1,192,132
1,105,471
1,019,707
ANNUAL D S C R
3.1
5.2
16.8
20.2
24.3
AVERAGE D S C R
1.6
2.6
8.4
10.1
12.2
