Professional Documents
Culture Documents
March, 2006
Pre-feasibility Study Sanitary Ware Manufacturing
2
Pre-feasibility Study Sanitary Ware Manufacturing
DISCLAIMER
The purpose and scope of this information memorandum is to introduce the subject
matter and provide a general idea and information on the said area. All the material
included in this document is based on data/information gathered from various sources and
is based on certain assumptions. Although, due care and diligence has been taken to
compile this document, the contained information may vary due to any change in any of
the concerned factors, and the actual results may differ substantially from the presented
information. SMEDA does not assume any liability for any financial or other loss
resulting from this memorandum in consequence of undertaking this activity. The
prospective user of this memorandum is encouraged to carry out additional diligence and
gather any information he/she feels necessary for making an informed decision.
For more information on services offered by SMEDA, please contact our website:
www.smeda.org.pk
DOCUMENT CONTROL
Prepared by SMEDA-Punjab
This document also provides Sectoral Information, brief on Government Policies and
International Scenario, which have some bearing on the Project itself.
This particular Pre-feasibility is regarding "Sanitary Ware Manufacturing Unit ". Before
studying the whole document one must consider following critical aspects, which forms
basis of any Investment Decision.
2. 1 SWOT Analysis
Before making the decision, whether to invest in the Potato Chips Manufacturing or not,
one should carefully analyze the associated risk factors. A SWOT analysis can help in
analyzing these factors, which can play important role in making the decision.
2.1.1 STRENGTHS
Continuous availability and easy access to Raw Material. About 60% of the raw
material that mainly comprises clay is available in the surrounding areas of
Gujranwala & Gujrat.
Availability of Cheaper Labor.
High quality Kiln installation to produce international quality standard products.
Tariff cuts under Trade Agreements are anticipated which may result in increase in
the Export market of the Sanitary Ware Products.
The life style of the people is improving and they are getting more quality conscious.
The main competitors in the Sanitary Ware manufacturing industry with respect to the
market share is the supply from un-organized sector but the permanent industry has
an edge over these supplies because of quality & standard, which is almost doubled as
compared to un-organized supplies. Market of un-organized sector can be accessed
and captured through automated marketing techniques.
Serving tough competition in the market through low prices, high quality and heavy
promotional charges.
2.1.2 WEAKNESSES
Strict controls over the Labor efficiency need to be observed to reduce the Waste
Production at the minimum level.
The production process is highly manual and requires high involvement of man
power thus strong controls over the man power is required.
Expected loss at the initial stages of the project as the operations are partly
automated.
2.1.3 OPPORTUNITIES
Increasing preference for the high quality products
Easier access to markets in accession countries.
Increasing share of developing countries in sanitary ware imports of France, Belgium
& UK and other countries of European Union.
Demand for Sanitary ware is influenced by the General economic conditions as well
as number of new houses built and old houses renovated.
2.1.4 THREATS
Low saving and low holding capacity of General Public as a result of which there is
increasing level of poverty.
Quality of the Sanitary Ware products need to be considered very closely as the
lifestyle of people is improving.
High Promotional activity by the Competitors and increased competition.
Chances of price cut from the existing players of the Sanitary ware manufacturers to
keep the new product out of market.
Another critical success factor of this proposed feasibility is the Marketing and
Promotion of the Sanitary Ware Products in the local as well as Foreign Market. This
involves the dedication and hard work from the marketing personals to supervise the
work of Wall Pasting, Banner affixing and a detailed advertising on the Media along with
the use of other marketing techniques such as Display Stands, Posters and use of Mobiles.
Following are some of the distributing Channels that are available for the promotion of
the products having distinct characteristics.
The current Sanitary Ware Market is already led by some of the players as specified in
Section 5.2 of this pre-feasibility. Entering into the market need heavy investment on the
marketing campaign of the product in order to capture the share.
There are many units existing which are in the business of Sanitary Ware Manufacturing
but still they are not successful in catering the demand due to degraded quality of raw
material used, high involvement of man power and un-availability of International
Standard Machines. So there is a potential for new entrepreneurs to enter the market. Key
success factors will be:
3 PROJECT PROFILE
3. 1 Opportunity Rationale
The Sanitary wares available in the local market are produced mainly in the Province of
Punjab & Sindh. In addition some niches of the market are also served by imports as
small quantity of some multinational brands is also available in the local market imported
mainly from Spain, Itly UK and USA.
Demand for sanitary ware is influenced by general economic conditions as well as the
number of new houses built and old houses renovated. New housing also presents
opportunities for new kitchens, bath rooms and latrine facilities1.
Table 2: Housing units by kitchen, bathroom & latrine facilities
Administrative Kitchen Bath Rooms Latrines
Units Separate Shared None Separate Shared None Separate Shared None
Pakistan 32.70 19.60 47.70 33.29 23.08 43.63 28.58 20.44 50.98
Rural 27.26 16.52 56.22 26.29 16.70 57.01 8.46 12.29 69.25
Urban 44.59 26.32 29.08 48.57 7.03 14.40 50.68 38.26 11.06
NWFP 33.01 20.79 46.20 34.47 23.77 41.76 24.50 18.17 57.33
Rural 31.70 19.20 49.10 32.88 20.74 46.38 21.09 13.86 65.05
Urban 39.54 28.74 31.72 42.41 38.91 18.69 41.57 39.68 18.74
FATA 56.37 12.05 31.58 62.78 11.61 25.61 36.86 6.99 56.10
Rural 56.13 12.24 31.63 62.50 11.70 25.80 35.98 6.98 57.04
Urban 65.76 4.76 29.47 73.39 8.22 18.39 70.66 7.53 21.81
Punjab 31.48 11.06 57.46 32.08 17.83 50.08 26.52 15.76 57.72
1
Source: 1998 Census of Pakistan
Rural 26.48 8.49 65.03 24.41 11.57 64.00 15.08 7.91 77.01
Urban 42.94 16.95 40.10 49.67 32.16 18.17 52.75 33.75 13.50
Sindh 34.69 32.46 32.85 33.94 31.12 34.94 35.36 30.57 34.08
Rural 24.63 28.50 46.87 22.98 21.92 55.11 24.23 20.08 55.69
Urban 47.90 37.65 14.44 48.34 43.21 8.46 49.97 44.33 5.70
Balochistan 22.72 46.11 31.16 26.56 41.74 31.70 18.58 29.25 52.16
Rural 19.89 44.25 35.86 24.12 38.70 37.19 14.46 23.61 61.92
Urban 34.01 53.49 12.50 36.26 53.81 9.93 34.93 51.70 13.36
Islamabad 62.80 16.46 20.74 58.50 17.11 24.30 55.47 16.92 27.61
Rural 55.76 11.01 33.21 44.09 13.01 42.89 37.37 11.65 50.98
Urban 66.23 19.10 14.66 65.64 19.11 15.24 64.28 19.48 16.23
The housing2 situation in Pakistan has steadily deteriorated over the past many years for a
variety of reasons including ineffective policies, resulting in huge housing backlog.
According to 1998 census, the total number of housing units throughout the country was
19.3 million. The housing backlog, as estimated according to the 1998 census, was 4.30
million units, which is now projected to 6.0 million units. The annual additional
requirement is estimated around 570,000 housing units whereas the annual production is
estimated around 300,000 housing units, resulting in a recurring shortfall of 270,000
housing units annually. It is estimated that in order to address the backlog and to meet the
housing shortfall in the next 20 years the overall housing production will have to be
increased to 820,000 housing units annually.
Recognizing the gravity of the situation and realizing the potentials of housing and
construction as productive sector of the economy, the present Government has declared
Housing and Construction as a priority industry and also formulated a pragmatic and
workable National Housing Policy with a view to (a) Accelerate housing activity and
contribute towards employment generation and economic development, (b) Facilitate
provision of housing inputs including land, finance, building materials, institutional and
legal framework, (c) Analyze the culture of poverty and the forces generating ever-
increasing slums and katchi abadis including political, public, socio-economic,
bureaucratic and environmental forces, (d) Promote ways and means for housing
development by enhancing affordability, saving capacity, human tendencies and
potential, (e) Provide safeguards against malpractices, bureaucratic in-efficiencies,
institutional weaknesses and mafia assaults and (f) Particularly for the low income
groups.
In the fiscal area the measures already implemented include: (a) Tax credit on borrowing
under housing loans from financial institutions has been enhanced from Rs.100,000/- or
25% of the income of the mortgagor, to Rs.500,000 or 40% of the income of the
mortgagor whichever is less, (b) The limit of property income for withholding tax has
2
Source : Economic Survey of Pakistan 2004 - 2005
been raised from Rs.100,000/- to Rs.200,000/-, (c) The rate of withholding tax on
property income has been reduced from 7.5% to 5%, (d) CED on wires and cables has
been withdrawn and excise duty on cement has been reduced by 25% to lessen cost of
construction, (e) Stamp duties and registration fees, which were exceptionally high as
compared to other countries, have been rationalized to enhance registration, improve
documentation and increase revenue receipts and (f) All new construction of housing on
plots, measuring up to 150 sq. yds and flats/apartments having an area of 1000 sq. ft,
have been exempted from all types of taxes for the period of 5 years.
The Prime Minister has also announced “HOUSING FOR ALL” program which
includes:-
Housing schemes for Government employees will be launched in all the districts of
the country for which provincial governments and ICT will provide (100) acres of
State Land immediately at affordable price.
Housing schemes for Government employees will be developed on public private
partnership basis in which Banks will participate through appropriate collaboration
with the private sector developers. Such partnership will be secured on competitive
basis through a transparent selection process.
Federal/Provincial/District Governments should facilitate and provide all necessary
support to Banks/developers with a view to creating an enabling environment.
Federal Government will ensure provision of trunk infrastructure at project sites from
National Utilities regarding electricity, gas and telephone. If required Banks may
finance extra cost of such infrastructure.
Provincial/Federal Governments will ensure provision of trunk infrastructure for
housing schemes.
To facilitate this process, Governments of Sindh, NWFP and Balochistan may
emulate the housing development model recently formulated and adopted by the
Government of Punjab for its employees.
Provincial Governments should identify lands, wherever available in their
jurisdiction, and make it available for promotion for Government housing sector.
Provincial Government will rationalize the rates of Registration Fee, Stamp Duty and
Property Tax to promote housing sector.
Provincial Governments/ICT Administration will ensure effective implementation of
foreclosure laws.
Provincial Governments will make necessary legislation, if required, for transfer to
state land at realistic/affordable rates for the Government employees housing
schemes.
Federal/Provincial Governments will submit proposals regarding grant of proprietary
rights to dwellers of Kachi-Abadis located on the Federal Government land for
consideration and decision.
The prime Minister has inaugurated (Phase-V) Housing Scheme for Low Paid F.G.
Employees (BPS 1-16) on 11-4-2005 for construction of 1000 multi-storied flats in
Sector G-11/4, Islamabad. The cost of the flats ranges from Rs.1.2 – 1.8 million. The
allottee will contribute 40% cost in installments and National Bank of Pakistan will
provide the remaining 60% as loan. Flats will be handed over to the allottees in two years
time. 90% apartments are earmarked for Federal Government employees of the
Ministries/Divisions, Attached Departments and Sub-ordinate offices and the remaining
10% apartments for the Employees of Autonomous Bodies/Corporations and other
Federal Government Organizations. Details of the scheme are given in Table below.
The demand for sanitary ware is influenced by general economic conditions as well as
number of new houses built and old houses renovated. New housing also presents
opportunities for consumption of sanitary ware. Since the life style of the people are
improving and they are getting more quality conscious, it is recommended to start up the project
at any time during the year.
3. 2 Project Brief
This particular Pre-feasibility is regarding “Sanitary Ware Manufacturing Unit”. The
objective of the Pre-feasibility study is primarily to provide an overview about the
Sanitary Ware Manufacturing business. The proposed Pre-feasibility defines the criteria
on which the investment decision is based. This document covers various aspects of
Sanitary Ware Manufacturing business concept development, Start-up, Production,
Marketing, Finance and Business Management. The Sanitary Ware Products are
classified under following three broad categories on the basis of material type. This
particular pre-feasibility however discusses the sanitary ware made of ceramics.
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time during the year due to the availability of Raw Material (Fresh Potatoes) throughout
the year.
3. 6 Project Investment
Total Project cost is Rs. 81.85 million.
11
IRR % - age 24 %
NPV @ 20 % Rs. 17,031,714
Pay Back Period 4.5 -Years
3. 7 Proposed Location
The said project can be started in any Industrial Area. It is recommended to establish the
Project in an area where Raw Material is easily available. It may have any Industrial Area
of Lahore, Gujranwala, Karachi or Islamabad. The location of this proposed Pre-
feasibility is recommended at Gujranwala. The availability of main raw material in the
region considerably increases the scope for establishment of the proposed project in the
said region.
In 1934 two residents of Gujranwala, Mr. Banarsi Shah and Charan Singh, set up a
sanitary fittings factory near the Gujranwala Railway Station, near Civil Lines. This
factory was to supply entire India with sanitary fittings. Although the houses of these
families can still be seen in Gujranwala, the factory was pulled down a few months ago,
the land which it occupied being about two acres in size and was next to the house of Mr.
Charan Singh. Mr. Rafiq Anwar and Mr. Mohammed Ramzan, [ two brothers ] who later
on went on to build "Anwar Mechanical Works" and "Asia Fans" in Gujranwala, initially
joined this factory in 1934 and worked there as employees. It was here that Mr. Anwar
learnt the trade and manufacture of taps and pipes made from brass and Gun-Metal, both
of which were available as scrap metal. Thus the techniques of polishing, chroming,
electro-plating and sand casting became well established in this small town of
Gujranwala.
In 1943, Mr. Anwar proceeded to form a partnership with a Mr. Ram Gopal Arora to
manufacture sanitary fittings, in a factory called "Prabhat Engineering" in Gujranwala’s
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old city. In 1947 at the time of the partition, Mr. Ram Gopal Arora turned over the
ownership of "Prabhat Engineering" to the name of Mr. Anwar. Mr. Anwar was to settle
all accounts in an orderly manner so that eventual payment of the factory value was
settled in a completely honorable manner. "Prabhat Engineering "was to be renamed as
"Battala Foundry" under the ownership of a Mr. Mohammed Yakub, who was a Muslim
refugee from India.
It was from these few industrious and ethical families of Charan Singh, Banarsi Shah and
Rafiq Anwar that the modern industries of Gujranwala arose and have taken their place in
modern day Pakistan’s industry.
The main sanitary ware units currently in operation in Pakistan are reproduced below:
Table 8: Major players of the market
No. COMPANY NAME ADDRESS
1- A.M Industries Mohallah Chah talianwala, Jinnah Road, Link
Nowshera Road, Gujranwala Tel # (0431)
220497
2- Anwar Mechanical Works G.T Road, Gujranwala Tel # (0431) 220497
3- Faisal Sanitary Fittings Ind. G.T. Road, PO Box 93, Gujranwala. Twl #
(Pvt.) ltd. (0431) 271243/271245, Fax (0431) 271650
4- Master Industries G.T.Road, Gujranwala Tel # (0431)
272770/272779, Fax (0431) 272127
5- Sonex Industries 6 Shamasabad, Gujranwala Tel # (0431) 219537.
Fax (0431) 219535
6- Pak Sanitary Engineering 97 Ferozepur Road, Ichhra, Lahore Tel # (042)
Works 7596544/7572340
7- Karaiz International 425-K, Model Town, Lahore – 54700. Tel #
(042) 561425/5880372 Fax (042) 5830284
According to the Census Bulletin - 1998 there are 35 units of sanitary ware in Gujranwala
with the installed capacity of 1,627 Lac Rupees.
4. 3 Sector Characteristics
Thangadh is a small town located some 70 kilometers from Rajkot and about 370
kilometers from Gandhinagar, Gujarat's capital. Despite being a small town having
population of about 50,000, this region has both a religious and an industrial importance.
It is said that King Drupad established his kingdom here and it was this place where
Draupadi's Swayamvara was held. But today, the town has acquired fame for its
sanitaryware business. There are about 200 small and medium scale units producing
about 150 types of sanitaryware items. Of the total sanitaryware exports of the country,
Thangadh alone accounts for an over 65 percent share.
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Providing employment to about 30,000 people, majority of the items produced here are
exported. Last year the total sanitary ware exports were of Rs .800/- million of which
items worth Rs. 550/- million were from Thangadh alone to UAE, Africa and other
middle east countries.
One of the main reasons why ceramic and sanitary ware units have developed here is
because of easy excess to raw material. About 60 percent of the raw material that mainly
comprises of clay is available in excess in the surrounding area.
However, unlike other industry, this industry too has a tough competition with China.
Currently, the units make use of fuel to bake the wares on high fire. This fuel itself
accounts for about 40 percent of the total cost. Units are now demanding supply of gas,
which is low in cost. Though the state government has made promise for Gas grid
pipeline within a year, the manufacturers are left with no option but to wait for the Gas
supply. Again in terms of policy matters and Government support, China has far more
transparent and liberal policy for exporters.
The industry has huge potential for both domestic and international market, provided it
gets proper government support, believes Suresh Sompura, the President of Federation of
Ceramic Industries in Thangadh.
Apart from exports, the domestic market for sanitary ware itself is very large. Currently
only 10 percent population of the country makes use of sanitary ware items. According to
the manufacturers, if proper policy are designed and implemented by the government for
improving public sanitation, the industry could grow in leaps and bound providing
employment to lakhs of people.
The recommendation of setting up the project in Gujranwala is also supported by the fact
that in addition of having easy acces to the raw material in this region, gas is also
available that may result in production of high quality and low cost sanitary ware
products.
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It Yourself (DIY) segment of the market. These countries, therefore, appear to present the
best market opportunities for exporters from developing countries.
According to Eurostat data, the total value of EU consumption in 2002 of sanitary ware
amounted to € 4,852 million. The largest markets for sanitary ware in the EU are Italy,
Spain, Germany, the United Kingdom and France.
In 2002, total EU imports of sanitary ware and ceramic tiles reached a volume of 5,960
thousand tonnes, which represented a value of € 5,134 million. Germany is the largest EU
importer of sanitary ware and ceramic tiles, with imports valued at € 1,090 million. The
most important developing countries in supplying EU imports, after Turkey, are China,
Egypt, South Africa, Morocco, Thailand, Tunisia and Croatia.
In the period 2000 - 2002, imports of sanitary ware have increased by 25 percent in value
and by six percent in volume. Approximately one-third of imports came from outside the
EU, with developing countries accounting for approximately 20 percent of total EU
imports of sanitary ware. The segment of ceramic sanitary products constituted the
largest share of EU imports of sanitary articles, followed by the group of plastic sanitary.
A six-digit list of the product groups is presented below. These product groups can be
further divided into sub-groups on a ten digits basis.
5.2.1 Sanitary ware made of plastics such as baths, showers, washbasins, bidets,
lavatory pans, seats and covers, flushing cisterns of plastics
Baths, showers and washbasins, of plastics 392210
Lavatory seats and covers, of plastics 392220
Bidets, lavatory pans, flushing cisterns and similar sanitary or hygiene products, of
plastics 392290
15
5.2.2 Ceramic sanitary ware such as sinks, wash basins, wash basin pedestals, baths,
bidets, lavatory pans, flushing cisterns, urinals and similar sanitary fixtures
Ceramic sinks, wash basins, wash basin pedestals, baths, bidets, lavatory pans, flushing
cisterns, urinals and similar sanitary fixtures of porcelain or china (excl. soap dishes,
sponge holders, tooth-brush holders, towel hooks and toilet paper holders) 691010
Ceramic sinks, wash basins, wash basin pedestals, baths, bidets, lavatory pans, flushing
cisterns, urinals and similar sanitary fixtures (excl. of porcelain or china, soap dishes,
sponge holders, ooth-brush holders, towel hooks and toilet paper holders) 691090
16
5. 3 Sanitary-ware made of iron or steel such as baths shower basins and wash
basins
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IMPORTS
In 2002, total EU imports of sanitary ware and ceramic tiles reached a volume of 5,960
thousand tonnes, which represented a value of € 5,134 million. An overview of EU
imports of sanitary ware and ceramic tiles is presented in figure.
Overview of EU imports in million €, 2000 – 2002
Between 2000 and 2002, the value of EU imports increased by 7 percent while its volume
decreased by 10 percent. Changes in volume and value of imports were very different for
the respective EU Member States, however.
Differences across product groups with respect to changes in volume and value between
EU Member States will be discussed in this section for Germany, France, United
Kingdom, Austria, Belgium and the Netherlands. An overview of the largest EU
importers of sanitary ware and ceramic tiles is provided in figure the following
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As shown in figure 5.2, Germany is the largest EU importer of sanitary ware and ceramic
tiles, with imports valued at € 1,090 million in 2002. Since 2000, its share in total EU
imports declined by 13 percent. France, the second largest EU importer (€ 1,046 million),
slightly increased its share of imports between 2000 and 2002. The United Kingdom is
Europe’s third largest importer followed by Belgium, Austria, the Netherlands, Italy and
Spain.
In 2002, intra-EU imports accounted for most of total EU imports (80 percent in value
and 81 percent in volume originated from within the EU). Developing countries
accounted for 10 percent of total value and 12 percent of total volume of EU imports.
Turkey, which accounted for 4 percent of total EU imports, is the largest non-EU country
supplying the EU market.
The most important developing countries in supplying EU imports, after Turkey (€ 219
million), are China (€ 88 million), Egypt (€ 54 million), South Africa (€ 21 million),
Morocco (€ 21 million), Thailand (€ 21 million) and Tunisia (€ 15 million).
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6 PRODUCTION PROCESS
6. 1 Production Process Flow
The following figure shows the production process flow of Sanitary Ware:
Final Inspection
& Packing Kiln Section Glazing
Section Section
The Raw Material requirement in tons is determined based on industry general trends and
visits to various Sanitary ware manufacturing units.
The Ball section machinery keeps the raw material in constant rotation. After being
grinded the machine converts the raw material in the form of slury mixture. There is no
waste production at this stage of the process. The slury mixture is then further stirred and
undisolved material is separated from the slury mixture for further refining. This Slury in
liquid form ( called slip ) is then transferred to overhead tanks through piping for further
supply to casting section.
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The moulds of required design and dimensions are prepared from the mother moulds.
These mould are made from Plaster of Paris for final reshaping of the required product.
Plaster of paris is mixed in water to prepare a slury mixture which is then put in the
mother moulds for 1 to 2 hours. The heating system helps to facilitate the drying process.
These sample moulds are taken out from the mother moulds and then sent to the Casting
department.
21
packaging into cartons while the defected pieces, about 15% of total production, are
scrapped out.
The Raw Material Mix is presented in Section 8.1 (Production Process) of this pre-
feasibility report.
22
7. 1 Machinery Requirement
Following table shows the plant & machinery requirement for setting up a Sanitary ware
Manufacturing Unit.
Table 12: Machinery Detail
Machine Description Make No. of Cost Total
Units per unit Cost
Rupees Rupees
Slip Section Machine
- Ball Mill Machines Capacity 10 Tons Local 2 450,000 900,000
- Stirrers Local 2 200,000 400,000
- Slip Pumps 7.5 H.P Local 2 70,000 140,000
- Compressor for slip storage Local 2 58,000 116,000
Glazing Section Machine Local 4 100,000 400,000
Kiln Local 1 2,500,000 2,500,000
Accessories Local 1,000,000
TOTAL 5,456,000
23
7. 5 Vehicles Requirement
The proposed project will also be using two cars costing Rs. 1,000,000/-, two Loader
truck for transportation purposes, four motor cycles costing 55,000, five cycles costing
3,500. The schedule is presented below:
Table 16: Vehicle Requirements
Items Cost Total Cost
Rupees Rupees
Cars 2 1,000,000 2,000,000
Loader Trucks 2 1,100,000 2,200,000
Motor Cycles 4 55,000 220,000
Cycles 5 3,500 17,500
TOTAL 4,437,500
24
8. 2 BUILDING REQUIREMENT
25
8. 3 Utility Requirements
Utilities required for a Sanitary ware manufacturing unit are; Electricity, Telephone, Gas
and Water.
Following table shows the requirements of Human Recourses in the Sanitary ware
Manufacturing unit.
26
Other benefits include EOBI, Social Security, Gratuity, Medical and Other welfare
expenses
27
10 KEY ASSUMPTIONS
28
29
Raw Material
Raw Meterial cost during the 1st Year of operation & consumption Requirments
Cost Per Kg
Rupees
Pottery Clay 10
Feldspar (stone) 13
Quartz 14
Grinding Stone 11
Chemicals & Colors ( 10% of Slip
Production)
Zarconium Silicate ( 10 % of Total 20
consumption)
Zinc Oxide ( 10 % of Total 15
consumption)
Barium Carbonate ( 10 % of Total 45
consumption)
Clay ( 65 % of Total 12.5
consumption)
30
70 % Reduction for Succeeding Year and then constant with impact of inflation.
31
32
11 FINANCIAL ANALYSIS
Working Capital
Current Assets:
Stock in Trade 15,718,673
Stores & Spares 778,396
Advances, Deposits & Other Receivables 6,711,654
Accounts Receivable 16,079,962
39,288,685
Current Liabilities:
Accounts Payable 7,643,853
Accrued Charges 4,344,455
Sales Tax Payable 1,417,678
Provision for Taxation 2,041,617
15,447,603
Total Working Capital Requirment 23,841,082
Total Investment 81,852,082
Financed By:
Sponsors' Equity 40,926,041
Debt Financing 40,926,041
33
RUPEES RUPEES RUPEES RUPEES RUPEES RUPEES RUPEES RUPEES RUPEES RUPEES
Cost of Sales 10.129 1,924,509 104,946,728 113,913,411 123,707,398 134,308,125 145,929,490 158,692,994 173,180,825 182,551,485 192,062,541
Gross Profit 21,489,713 34,454,859 44,378,668 51,206,764 58,569,012 66,720,512 75,753,888 76,838,269 80,300,813 83,961,045
Operating Expenses: 18.95 24.72 28.04 29.28 30.37 31.38 32.31 30.73 30.55 30.42
Administrative Expenses 10.13 7,712,026 7,565,524 7,770,672 8,092,200 8,478,410 8,928,484 9,442,490 10,001,811 10,593,327 11,247,526
Marketing Expenses 10.14 7,750,900 4,502,408 3,760,011 4,077,999 4,424,884 4,803,413 5,216,596 5,667,740 6,160,472 6,698,776
15,462,926 12,067,931 11,530,683 12,170,199 12,903,294 13,731,896 14,659,086 15,669,551 16,753,799 17,946,301
Operating Profit 6,026,787 22,386,928 32,847,985 39,036,565 45,665,718 52,988,616 61,094,802 61,168,718 63,547,014 66,014,744
Other Income 283,536 348,504 395,730 437,285 482,193 531,625 586,117 625,048 657,131 690,059
6,310,323 22,735,432 33,243,715 39,473,850 46,147,911 53,520,241 61,680,919 61,793,765 64,204,145 66,704,803
Bank Charges 170,121 209,102 237,438 262,371 289,316 318,975 351,670 375,029 394,278 414,035
Other Charges 307,010 834,718 1,420,105 1,791,754 2,185,499 2,614,021 3,066,462 3,070,937 3,190,493 3,314,538
477,131 6,875,782 6,261,723 5,430,524 4,623,432 3,853,832 3,418,133 3,445,965 3,584,772 3,728,574
Profit before Taxation 5,833,192 15,859,650 26,981,993 34,043,327 41,524,479 49,666,408 58,262,786 58,347,800 60,619,373 62,976,229
Taxation 2,041,617 5,550,877 9,443,697 11,915,164 14,533,568 17,383,243 20,391,975 20,421,730 21,216,781 22,041,680
Profit after Taxation 3,791,575 10,308,772 17,538,295 22,128,162 26,990,911 32,283,165 37,870,811 37,926,070 39,402,593 40,934,549
Accumulated Profits - brought forward - 3,791,575 14,100,347 31,638,642 53,766,804 80,757,716 113,040,881 150,911,692 188,837,762 228,240,355
Accumulated Profits - carried forward 3,791,575 14,100,347 31,638,642 53,766,804 80,757,716 113,040,881 150,911,692 188,837,762 228,240,355 269,174,904
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Owners Equity:
C apital Introduced 40,926,041 40,926,041 40,926,041 40,926,041 40,926,041 40,926,041 40,926,041 40,926,041 40,926,041 40,926,041
Accum ula ted Pro fits 3,791,575 14,100,347 31,638,642 53,766,804 80,757,716 113,040,881 150,911,692 188,837,762 228,240,355 269,174,904
44,717,616 55,026,388 72,564,683 94,692,846 121,683,757 153,966,922 191,837,733 229,763,803 269,166,396 310,100,945
Curre nt Liabilities:
C urre nt Portion of Long Term Loan 10.108,185,208 8,185,208 8,185,208 8,185,208 8,185,208 - - - - -
Accounts Payable 7,643,853 8,440,382 9,307,683 10,257,567 11,304,405 12,458,299 13,730,225 15,119,301 15,870,267 16,658,656
Accrued C harges 4,344,455 3,842,169 3,964,175 4,210,163 4,475,078 4,760,683 5,068,907 5,400,266 5,742,411 6,111,672
M ark - up payable - 2,762,508 2,148,617 1,534,727 920,836 306,945
Sales Tax Payable 1,417,678 1,742,520 1,978,651 2,186,427 2,410,964 2,658,125 2,930,586 3,125,239 3,285,654 3,450,295
Pro vision for Taxation 2,041,617 5,550,877 9,443,697 11,915,164 14,533,568 17,383,243 20,391,975 20,421,730 21,216,781 22,041,680
23,632,811 30,523,664 35,028,032 38,289,257 41,830,059 37,567,295 42,121,694 44,066,535 46,115,113 48,262,303
101,091,260 110,105,677 123,963,131 141,167,311 163,513,816 191,534,218 233,959,427 273,830,339 315,281,508 358,363,248
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P ro je c te d C a s h F lo w
Ye a r - I Y e a r - II Y e a r - III Y e a r - IV Yea r - V Year - VI Y e a r - V II Y e a r - V III Y e a r - IX Year - X
RU PEES RU PEES RU PEES RUPEES RU PEES RU PEES RU PEES RUPEES R U P E ES RU PEES
P ro fit b e fo re Ta x a t io n 5 ,8 3 3 ,1 9 2 1 5 ,8 5 9 ,6 5 0 2 6 ,9 8 1 ,9 9 3 3 4 ,0 4 3 ,3 2 7 4 1 ,5 2 4 ,4 7 9 4 9 ,6 6 6 ,4 0 8 5 8 ,2 6 2 ,7 8 6 5 8 ,3 4 7 ,8 0 0 6 0 ,6 1 9 ,3 7 3 6 2 ,9 7 6 ,2 2 9
D e p re c ia t io n 3 ,8 7 8 ,1 0 0 3 ,4 9 3 ,6 2 8 3 ,1 6 0 ,7 4 8 2 ,8 7 0 ,9 8 2 2 ,6 1 7 ,3 9 7 2 ,3 9 4 ,3 1 1 2 ,1 9 7 ,0 5 4 2 ,0 2 1 ,7 7 6 1 ,8 6 5 ,2 9 5 1 ,7 2 4 ,9 6 8
9 ,7 1 1 ,2 9 2 1 9 ,3 5 3 ,2 7 7 3 0 ,1 4 2 ,7 4 0 3 6 ,9 1 4 ,3 0 9 4 4 ,1 4 1 ,8 7 6 5 2 ,0 6 0 ,7 2 0 6 0 ,4 5 9 ,8 4 0 6 0 ,3 6 9 ,5 7 6 6 2 ,4 8 4 ,6 6 8 6 4 ,7 0 1 ,1 9 7
S to c k in Tr a d e (1 5 ,7 1 8 ,6 7 3 ) (2 ,1 7 3 ,3 5 0 ) (1 ,9 7 1 ,1 9 6 ) (1 ,9 9 1 ,4 8 5 ) (2 ,1 6 9 ,8 2 1 ) (2 ,3 8 8 ,6 1 5 ) (2 ,6 3 1 ,6 3 7 ) (2 ,3 2 7 ,8 8 2 ) (1 ,6 0 0 ,4 3 8 ) (1 ,6 6 3 ,2 0 9 )
S to r e s & S p a r e s (7 7 8 ,3 9 6 ) (9 3 ,6 2 4 ) (9 1 ,7 1 1 ) (9 6 ,2 0 7 ) (1 0 5 ,5 1 3 ) (1 1 6 ,1 3 5 ) (1 2 7 ,8 7 0 ) (1 3 2 ,0 6 7 ) (7 3 ,8 6 7 ) (7 7 ,2 4 6 )
A d v a n c e s, D e p o sit s & O t h e r R e c e iv a b le s (6 ,7 1 1 ,6 5 4 ) (9 3 ,5 9 4 ) (5 2 6 ,9 7 9 ) (6 4 8 ,5 0 8 ) (7 1 2 ,7 0 0 ) (7 8 3 ,1 7 5 ) (8 6 0 ,5 8 1 ) (9 4 0 ,4 2 4 ) (6 1 5 ,0 2 2 ) (6 5 3 ,6 1 6 )
A c c o u n t s R e c e iv a b le (1 6 ,0 7 9 ,9 6 2 ) (3 ,6 8 4 ,5 1 0 ) (2 ,6 7 8 ,3 1 0 ) (2 ,3 5 6 ,6 9 2 ) (2 ,5 4 6 ,8 0 5 ) (2 ,8 0 3 ,4 1 3 ) (3 ,0 9 0 ,3 8 0 ) (2 ,2 0 7 ,8 4 1 ) (1 ,8 1 9 ,5 0 2 ) (1 ,8 6 7 ,4 3 6 )
A c c o u n t s P a y a b le 7 ,6 4 3 ,8 5 3 7 9 6 ,5 2 9 8 6 7 ,3 0 1 9 4 9 ,8 8 4 1 ,0 4 6 ,8 3 8 1 ,1 5 3 ,8 9 4 1 ,2 7 1 ,9 2 6 1 ,3 8 9 ,0 7 6 7 5 0 ,9 6 6 7 8 8 ,3 8 9
A c c r u e d C h a rg e s 4 ,3 4 4 ,4 5 5 (5 0 2 ,2 8 6 ) 1 2 2 ,0 0 6 2 4 5 ,9 8 9 2 6 4 ,9 1 4 2 8 5 ,6 0 6 3 0 8 ,2 2 4 3 3 1 ,3 5 9 3 4 2 ,1 4 5 3 6 9 ,2 6 1
M a rk - u p p a y a b le - 2 ,7 6 2 ,5 0 8 (6 1 3 ,8 9 1 ) (6 1 3 ,8 9 1 ) (6 1 3 ,8 9 1 ) (6 1 3 ,8 9 1 ) (3 0 6 ,9 4 5 ) 0 0 0
S a le s Ta x P a y a b le 1 ,4 1 7 ,6 7 8 3 2 4 ,8 4 2 2 3 6 ,1 3 1 2 0 7 ,7 7 6 2 2 4 ,5 3 7 2 4 7 ,1 6 1 2 7 2 ,4 6 1 1 9 4 ,6 5 3 1 6 0 ,4 1 5 1 6 4 ,6 4 1
(2 5 ,8 8 2 ,6 9 9 ) (2 ,6 6 3 ,4 8 6 ) (4 ,6 5 6 ,6 4 8 ) (4 ,3 0 3 ,1 3 4 ) (4 ,6 1 2 ,4 4 0 ) (5 ,0 1 8 ,5 6 8 ) (5 ,1 6 4 ,8 0 1 ) (3 ,6 9 3 ,1 2 7 ) (2 ,8 5 5 ,3 0 2 ) (2 ,9 3 9 ,2 1 7 )
C a s h fo rm o th e r S o u rc e s
S p o n so rs' E q u it y 4 0 ,9 2 6 ,0 4 1 - - - - - - - - -
D e b t F in a n c in g 4 0 ,9 2 6 ,0 4 1 - - - - - - - - -
8 1 ,8 5 2 ,0 8 2 - - - - - - - - -
To t a l S o u rc e s 6 5 ,6 8 0 ,6 7 5 1 6 ,6 8 9 ,7 9 2 2 5 ,4 8 6 ,0 9 2 3 2 ,6 1 1 ,1 7 4 3 9 ,5 2 9 ,4 3 6 4 7 ,0 4 2 ,1 5 2 5 5 ,2 9 5 ,0 4 0 5 6 ,6 7 6 ,4 4 9 5 9 ,6 2 9 ,3 6 5 6 1 ,7 6 1 ,9 8 0
A p p lic a tio n s:
F ixe d A sse ts 5 8 ,0 1 1 ,0 0 0 - - - - - - - - -
L o n g Te rm D e p o sits 2 ,7 8 4 ,0 0 0
R e -P a y m e n t o f L o a n - 8 ,1 8 5 ,2 0 8 8 ,1 8 5 ,2 0 8 8 ,1 8 5 ,2 0 8 8 ,1 8 5 ,2 0 8 8 ,1 8 5 ,2 0 8 - - - -
Ta xa tio n - 2 ,0 4 1 ,6 1 7 5 ,5 5 0 ,8 7 7 9 ,4 4 3 ,6 9 7 1 1 ,9 1 5 ,1 6 4 1 4 ,5 3 3 ,5 6 8 1 7 ,3 8 3 ,2 4 3 2 0 ,3 9 1 ,9 7 5 2 0 ,4 2 1 ,7 3 0 2 1 ,2 1 6 ,7 8 1
6 0 ,7 9 5 ,0 0 0 1 0 ,2 2 6 ,8 2 5 1 3 ,7 3 6 ,0 8 6 1 7 ,6 2 8 ,9 0 6 2 0 ,1 0 0 ,3 7 3 2 2 ,7 1 8 ,7 7 6 1 7 ,3 8 3 ,2 4 3 2 0 ,3 9 1 ,9 7 5 2 0 ,4 2 1 ,7 3 0 2 1 ,2 1 6 ,7 8 1
C a s h In c re a s e / ( D e c re a se ) 4 ,8 8 5 ,6 7 4 6 ,4 6 2 ,9 6 6 1 1 ,7 5 0 ,0 0 6 1 4 ,9 8 2 ,2 6 9 1 9 ,4 2 9 ,0 6 3 2 4 ,3 2 3 ,3 7 6 3 7 ,9 1 1 ,7 9 7 3 6 ,2 8 4 ,4 7 4 3 9 ,2 0 7 ,6 3 5 4 0 ,5 4 5 ,2 0 0
O p e n in g B a la n c e - 4 ,8 8 5 ,6 7 4 1 1 ,3 4 8 ,6 4 1 2 3 ,0 9 8 ,6 4 7 3 8 ,0 8 0 ,9 1 6 5 7 ,5 0 9 ,9 7 9 8 1 ,8 3 3 ,3 5 5 1 1 9 ,7 4 5 ,1 5 2 1 5 6 ,0 2 9 ,6 2 6 1 9 5 ,2 3 7 ,2 6 1
C lo sin g B a la n c e 4 ,8 8 5 ,6 7 4 1 1 ,3 4 8 ,6 4 1 2 3 ,0 9 8 ,6 4 7 3 8 ,0 8 0 ,9 1 6 5 7 ,5 0 9 ,9 7 9 8 1 ,8 3 3 ,3 5 5 1 1 9 ,7 4 5 ,1 5 2 1 5 6 ,0 2 9 ,6 2 6 1 9 5 ,2 3 7 ,2 6 1 2 3 5 ,7 8 2 ,4 6 1
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