M/S RAHEEL DAIRY FARM
THATTA
BRIEF SUMMARY OF THE PROJECT
1. Name of the Project M/s Raheel Dairy Farm
2. Location Thatta
3. Status Sole Proprietorship
4. Name of the Proprietors Khalid Akbar Jatoi
5. Name of Bankers UBL Bank Limited, Hyderabad
6. New / Bal / Exp / Mod New
7. Amount of Financial Assistance 40.000 Million (to be taken)
8. Purpose of Financial Assistance Animals (Buffaloes & Bulls) Rs. 40. Millions
9. Annual Rated Capacity 2,160,000 Litters Milk in 365 Days Produced by
Animals. Details are given in the assumptions of
the report.
10. Cost of the Project a) Fixed Cost 194.822 Million
b) Working Capital 111.208 Million
Total 306.030 Million
11. Financial Plan
Description Loan to be taken Sponsors Contribution
a) Fixed Cost 40.000 million 10. Million
b) Working Capital - 111.208. Million
14. Loan Equity Ratio a) In Fixed Cost of the Project 17 %
b) In Working Capital 0%
c) In Over all Cost of the Project 12 %
15. New Jobs Opportunities a) Production side 21 Nos.
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b) Managerial side 09 Nos.
16. Annual Contribution to GNP 1st year 255.853 Million
2 year
nd
281.439 Million
3rd year309.586 Million
4th year 340.549 Million
5th year 374.608 Million
17. Financial Projection Net Profit after Taxes
1st year 148.345 Million
2 year
nd
167.711 Million
3rd year178.114 Million
4th year 179.065 Million
5th year 191.455 Million
18. Profitability Ratio (%) 1st year
a) Gross Profit to Sale 35.76
b) Net Profit to Sale 38.15
19. Debt Service Coverage 2nd year
a) With Depreciation 143.480 Million
b) Without Depreciation 143.232 Million
20. Break Even Analysis 60 %
Safety Margin 40 %
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M/S RAHEEL DAIRY FARM
THATTA
INTRODUCTION
The sponsors of, M/S RAHEEL DAIRY FARM, THATTA intend to open a Dairy Farm with a
financial assistance of Rs. 40.000 million is to be taken for purchase of animals from UBL Bank
Limited for completion of the project.
RATED CAPACITY
The annual rated capacity of the proposed farm is 6,000 Ltrs Milk per day i-e 2,160,000 Ltrs per
annum or 365 days. The Capacity Utilization of the Farm has been assumed at 100% 1st year, 100
% 2nd year, 98% 3rd year, 95% 4th year, 95% 5th year.
THE BORROWRS
The Proposed project is a sole proprietorship business to be established by Mr. Khalid Akbar
Jatoi. The entrepreneurs of the proposed project have good repute in business community and
already running established business.
THE MANAGEMENT
The sponsor will look after the overall working of the project. However to run the project 21 p
ersons on production side and 09 persons on managerial side will be recruited locally. The details
of the employees are given at annexure-VI of Report.
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THE PROJECT
LOCATION OF THE PROJECT
The proposed project will be located at THATTA, the site of the location enjoying an ideal Dairy
farm. The necessary infrastructure facilities including, roads, transport, labour, electricity, gas,
sewerage etc are already available on the side. The area of the plot is which are sufficient for a
dairy farm.
BUILDING AND CIVIL WORKS
All the buildings and structures to be constructed of RCC and T-Iron. The cost of the building
has been estimated to Rs. 4.861 million. The detail of which are given here under:
S. Type of
Description
No Construction
1 buffalo Shed R.C.C Frame Structure
2 Food Block R.C.C Frame Structure
R.C.C Column & G. I Sheet
3 Store Structure
4 Boundary Wall Briks Frame Structure
……………
5 Earth Filling
……………
6 Water Tank
……………
7 Water pound excavation
……………
8 Iron Gate
TOTAL
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ANIMALS
The total cost of the animals will be Rs. 40.000 million which will be met through loan included
transportation and purchase expenses. The detail of animals is given here under:
Buffaloes : 200
Bulls : 12
Calves : 25
ANIMALS FOOD
The main material required at farm is cattle food dry & silage, concentrates, Wheat Straw. The
costs of feed are detailed below.
Material Cost
Silage 0.663 (M)
Wheat Straw 1.598 (M)
Other concentrates 10.475 (M)
MARKETING CHANNELS
Dairy production is an all-inclusive activity, related to animal care, production, feeding, and
management. It is defined as all those aspects and activities relating to rising of dairy animals
during their various phase of life to get wholesome milk. The proposed project is to be in the
vicinity of Thatta.
Livestock production is an integral part of Pakistan’s agriculture sector and plays a vital role in
the national economy. At present, livestock contributes about 52.3% to the agricultural sector’s
and 11.5 % to GDP. The main product of dairy farm will be milk which will be sold on daily
basis. Pakistan is the fifth largest milk producer in the world. Raw milk is used for drinking and
tea making purpose. In rural areas milk is used to make desi ghee (clarified butter), yogurt, lasi
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etc. while the urban household are the major consumer of milk.
UTILITIES
Concerned authorities will provide the utility requirement of the project. No difficulty is fore
seen in the availability of the desired utilities.
WATER
Water connection is available at the project side for full filling general need of water.
FUEL
For other general usage, adequate supply of fuel will be arranged from the local dealers.
JOB OPPORTUNITIES
The Purposed project will provide job opportunities to the 30 persons. No Difficulty is fore seen
in hiring and retaining experienced and efficient worker. Sufficient type of skilled labour is
locally available.
PROJECT VAIBILITY
The estimated earnings of the proposed project are given below.
Ye ar of Ope ration 1st Ye ar 2nd Ye ar 3rd Ye ar 4th Ye ar 5th Ye ar
Profitability Ratios. (%) - - - - -
a) Net Profit to Sales 38.15 38.82 38.25 36.36 35.89
b) Gross Profit to Sales 35.76 36.40 35.10 32.49 31.45
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CASH FLOW
The project cash flow statement is attached in the Annexure-XII. It is evident from the fund flow
statement no problem or shortage of fund is expected if the revenues from the sales are recovered
regularly. Cash balance will increase with the built up of reserves / retained earnings.
DEBT SERVICE COVERAGE
The Debt Service Coverage of the project for five years operation will be as under:
With Depreciation 143.480 160.821 171.203 172.135 184.511
Without Depreciation 143.232 160.601 171.009 171.961 184.357
Details are attached at annexure VIII.
BREAK EVEN ANALYSIS
The project is expected to achieve Break Even Point at 60% on third year operation. The details
are attached at annexure VII.
CONCLUSION AND RECOMMENDATION
The proposed project has been appraised from economics and marketing point of view and will
be viable for financial assistance. It is evident from the profitability (forecast of earnings)
attached as annexure III, the proposed project will earn handsome amount from 1st year to
5th year and there will no difficulty to the borrowers in payment of the loan installment and
markup.
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