PROJECT PROPOSAL

ON

INTRODUCTION

Marine fish production in India during 2015 was

recorded at 3.6 million tonnes & among the 3

major producing states Kerala holds the 3rd

position.

Seafood exports from India touched an all-time-

high of Rs 33,441.61 crore, recording a growth

of 11 per cent over the previous year.

The location of the proposed project and the

increasing value of seafood provides a great

scope to the project.

SCOPE OF THE PROJECT• Product :-

The project proposes to process squid(raw material)into block frozen product of different grades.

• Market :-

It is proposed to market the product outside thecountry.

• Promoter:-

Gopika Viswanath

kizhakeettil (H)

panangad

Ernakulam

kochi-682506

• Raw materials:-

The raw material is squid( Loligo duvacelli )

which will be purchased from various landing

centers such as Thoppumpady, Munambam,

Vypin, Neendakara etc.

• Technical knowhow:-

Employees having sufficient technical know-how is

posted in this project.

MANUFACTURING PROCESS

shipment

Cold store

Packing and labelling

Glazing,glaze hardening

Freezing

Setting in trays

weighing

grading

washing

Pre-processing (dressing,treatment,etc)

Raw material receiving

• Environmental impact :-

The waste water generated from the plant

will be treated in an effluent treatment

plant and after treatment the water is

discharged into the sea. Hence it is clear

that the proposed project will not cause

any harm to the environment.

PROJECT PARTICULARS• Location : Aroor, Alappuzha district.

• Capacity 40tonnes /month

• Building (20 cent)

facilities required are:

1. Pre-processing section

2. Processing section

3. Laboratory

4. Office

5. Restroom & toilets

6. Cold storage

7. Chill room

8. Ice producing section

9. Machine room

10. Overhead tank

11. Effluent treatment system

• Plant & Machinery :: Rs 35,00,000/-

Blast freezer

Flake ice machine

Agitator(squid washer)

Weighing machines

Incubator

Autoclave

Processing tables

Vacuum sealer

• Implementation & Registration :

Proposed project will be registered by MPEDA & it

will start functioning within a period of 6 months.

• Project cost :

The total cost of the project is estimated to be Rs3,70,20,000/-

• Labour requirement

Description of labour number Total salary (Rs.)

Direct labour

1)Pre-processing 10 45,000

2)Processing 15 77,000

3)Supervisors 3 24,000

28 1,46,000

Indirect labour

Office staff and other workers 28 2,33,500

FIXED ASSETSSL NO. PARTICULARS AMOUNT (Rs)

1 Land 25,00,000

2 Building 65,00,000

3 Plant & machinery 35,00,000

4 Fixtures & fittings 13,00,000

5 Furniture & Equipment’s 10,00,000

6 Vehicles 30,00,000

7 electrification 10,00,000

8 Preliminary and Pre-operative

expenses 15,00,000

2,03,00,000

Add contingency @10 % 20,30,000

Total fixed assets 2,23,30,000

WORKING CAPITAL REQUIREMENTS( 1 month)

SLNO. PARTICULARS AMOUNT (Rs)

1Raw material(30 days) 70,00,000

2 Finished goods (15 days)

1. Raw material 35,00,000

2. Labour 73,000

3. Packing material 37,000

4. Overheads 10,000

5. Electricity 70,000

3. Sundry Debtors 20,00,000

4. Cash-In-hand 20,00,000

Total Working Capital1,46,90,000

SOURCE OF FINANCING

• Fixed assets Term loan : 2,00,00,000

own capital : 23,30,000 Total fixed capital: 2,23,30,000

• Working capitalTerm loan : 1,45,00,000

own capital : 1,90,000 Total working capital : 1,46,90,000

TOTAL COST OF THE PROJECT : 3,70,20,000/-

SCHEDULE OF WORKING CAPITAL REQUIREMENTS( 1 month)

CAPACITIES WORKING CAPITAL REQUIREMENT( RS)

60% 94,34,000

80% 1,18,62,000

90% 1,36,29,000

100 % 1,46,90,000

SCHEDULE OF DEPRECIATION FOR7 YEARS

YEAR DEPRECIATION (Rs)

1 19,30,000

2 16,77,000

3 14,61,300

4 12,76,770

5 11,18,373

6 9,81,961

7 8,64,107

Schedule of repayment of Term loan

particulars

1st year 2nd year 3rd year 4th year 5th year 6th year 7th year

Term loan 20,00,000 20,00,000 19,00,000 17,00,000 15,00,000 13,00,000 11,00,000

Working capital loan

14,50,000 14,50,000 13,50,000 12,00,000 10,50,000 8,50,000 6,50,000

total 34,50,000 54,50,000 67,50,000 64,00,000 65,50,000 61,50,000 57,50,000

PROJECTED PROFITABILITY STATEMENT

FOR 7 YEARS

PARTICULARS 1st YEAR 2nd YEAR 3rd YEAR 4th YEAR

Capacity utilization 60% 80% 90% 90%

Net Sales @ Rs.280 / kg(less

customs and excise 0.8%) 7,99,94,880 10,66,59,840 11,99,92,320 11,99,92,320

Less cost of goods sold 5,36,16,000 7,10,88,000 7,98,96,000 7,98,96,000

Gross profit (sales-CGS) 2,63,78,880 3,55,71,840 4,00,96,320 4,00,96,320

Less Office & administrative

expenses 28,08,000 36,00,000 42,00,000 45,00,000

Less Selling & distribution

expenses 6,00,000 8,00,000 9,00,000 9,50,000

Interest on Loan(10 %) 34,50,000 54,50,000 6750000 6400000

Less depreciation 19,30,000 16,77,000 14,61,300 12,76,770

Preliminary expense written

off 1,50,000 1,50,000 1,50,000 1,50,000

Net profit 1,74,40,880 2,38,94,840 2,66,35,020 2,68,19,550

Less Income tax 30% 52,32,264 71,68,452 79,90,506 80,45,865

N.P.A.T : 1,22,08,616 1,67,26,388 1,86,44,514 1,87,73,685

PROJECTED PROFITABILITY STATEMENT FOR LAST 3 YEARS

PARTICULARS 5th YEAR 6th YEAR 7th YEAR

Capacity utilization 100% 100% 100%

Net Sales @ Rs.280 / kg(less

customs and excise 0.8%) 13,44,00,000 133324800 133324800

Less cost of goods sold 8,85,60,000 88560000 88560000

Gross profit (sales-CGS) 4,47,64,800 44764800 44764800

Less Office & administrative

expenses 50,00,000 5200000 5500000

Less Selling & distribution

expenses 10,00,000 1050000 1050000

Interest on Loan (10%) 6550000 6150000 5750000

Less depreciation 1118373 981961 864107

Preliminary expense written off 150000 150000 150000

Net profit 30946427 31232839 31450693

Less Income tax 30% 9283929 9369852 9435208

NPAT : 21662498 21862987 220154485

PROJECTED CASHFLOW STATEMENT FOR 7 YEARS

PARTICULAR

S

1st

YEAR

2nd

YEAR

3rd

YEAR

4th

YEAR

5th

YEAR

6th

YEAR

7th

YEAR

Cash inflow (A)

Opening cash

balance - 31008616 47562004 64317818 81018273 99949144 118944092

Own capital 25200000 - - - - - -

Term loan 20000000 - - - - - -

Working capital

loan 14500000 - - - - - -

N.P.A.T 12208616 16726388 18644514 18773685 21662498 21862987 22015485

Depreciation 1930000 1677000 1461300 1276770 1118373 981961 864107

Preliminary exp 150000 150000 150000 150000 150000 150000 150000

Interest on loan 3450000 5450000 6750000 6400000 6550000 6150000 5750000

Income tax 5232264 7168452 7990506 8045865 9283929 9369852 9435189

Total cash

inflow (A) 59990880 62180456 82558324 971344138 119783073 138463944157158873

Cont…

PARTICULARS

1st

YEAR

2nd

YEAR

3rd

YEAR

4th

YEAR

5th YEAR 6th YEAR 7th YEAR

Cash outflow (B)

Purchase of

fixed assets 20300000 - - - - - -

Income tax 5232264 7168452 7990506 8045865 9283929 9369852 9435189

Interest on loans 3450000 5450000 6750000 6400000 6550000 6150000 5750000

Repayment of

term loan - 1000000 2000000 2000000 2000000 2000000 2000000

Repayment of

working capital - 1000000 1500000 1500000 2000000 2000000 2000000

Total cash

outflow (B) 28982264 14618452 18240506 17945865 19833929 19519852 19185189

closing cash

balance

(A-B) 31008616 47562004 64317818 81018273 99949144 118944092137973684

PROJECTED BALANCE SHEET FOR THE 1st YEARLiabilities Amount

( Rs)

Assets Amount

( Rs)

Own capital- 25,20,000

Add net profit- 12,208,616 14,728,616

Cash in hand and bank 3,10,08,616

Land 25,00,000

Term Loan 2,00,00,000 Building- 65,00,000

Less dep. - 6,50,000 58,50,000

Working capital loan

1,45,00,000

Plant& mach. - 35,00,000

Less dep. - 3,50,000 31,50,000

4,92,28,616

Furniture& eq.- 10,00,000

Less dep. - 1,00,000

Vehicles- 30,00,000

Less dep. - 6,00,000

Fixture &fit - 13,00,000

Less dep. - 1,30,000

Electrification

Preliminary exp. written off

9,00,000

24,00,000

1170000

900000

13,50,000

4,92,28,616

PROJECTED BALANCE SHEET FOR THE 7th YEARLiabilities Amount

( Rs)

Assets Amount

( Rs)

Own capital- 25,20,000 Cash in hand and bank 13,79,73,684

Land 25,00,000

Term Loan - 11000000

Less repayment - 2000000 90,00,000

Building- 34,54,995

Less dep. - 3,45,500 31,08,929

Working capital loan – 650000

Less repayment -2000000

P & L A/C - 10,98,78,688

Add net profit - 2,20,15,485

45,00,000

Plant& mach. - 18,60,043

Less dep. - 1,86,005 16,74,038

13,18,94,173

14,79,14,173

Furniture& eq.- 5,31,441

Less dep. - 53,145

Vehicles- 78,64,322

Less dep. - 1,57,287

Fixture &fit - 6,90,873

Less dep. - 69,088

Electrification

Preliminary exp. written off

4,78,296

6,29,145

6,21,785

4,78,296

4,50,000

14,79,14,173

Schedule of variable cost

Year 1 2 3 4 5 6 7

Totalvariable cost

53616000 71088000 40096320 40096320 44764800 44764800 44764800

Schedule of fixed expenses

year 1 2 3 4 5 6 7

Total fixed expenses

8788000 11527000 13311300 13126770 13668373 13381961 13164107

BREAK EVEN POINT ANALYSIS

Year CAPACITIES P/V RATIO

(%)

B.E.P (Rs)

Capacities at

which B.E.P is

attained (%)

1 60% 32.98 2,66,46,452 19.98

2 80% 33.34 3,45,74,085 25.93

3 90% 33.42 3,98,30,341 29.87

4 90% 33.42 3,92,78,187 29.46

5 100% 33.58 4,07,03,910 30.52

6 100% 33.58 3,98,50,986 29.89

7 100% 33.58 3,92,02,225 29.40

FINANCIAL FEASIBILITY OF THE PROJECT

• PAY BACK PERIOD

2 years & 3 months

• RETURN ON INVESTMENT

50.89%

• IRR

43.99%

CONCLUSION

– The Pay back period of the project is 2 years and 3 months.

– The IRR of the project is 43.99%

– Short payback period and greater IRR makes the project to earn greater profit.

– The product has high demand & there is no difficulty in marketing the product.

– The product does not cause any environmental damage.