Pre-Feasibility Study for Proposed High School

Pre-Feasibility Study
HIGH SCHOOL
Small and Medium Enterprise Development Authority

Government of Pakistan
www.smeda.org.pk
HEAD OFFICE
6th Floor LDA Plaza, Egerton Road, Lahore 54000, Pakistan
Tel: (042) 111-111-456, Fax: (042) 6304926-7
helpdesk@smeda.org.pk
REGIONAL OFFICE
PUNJAB
REGIONAL OFFICE
SINDH
REGIONAL OFFICE
NWFP
REGIONAL OFFICE
BALOCHISTAN
8th Floor, LDA Plaza,

Egerton Road, Lahore.
Tel: (042) 111-111-456
Fax: (042) 6304926-7
helpdesk@smeda.org.pk
5TH Floor, Bahria

Complex II, M.T. Khan Road,
Karachi.
Tel: (021) 111-111-456
Fax: (021) 5610572
helpdesk-khi@smeda.org.pk
Ground Floor
State Life Building
The Mall, Peshawar.
Tel: (091) 9213046-47
Fax: (091) 286908
helpdesk-pew@smeda.org.pk
Bungalow No. 15-A

Chaman Housing Scheme
Airport Road, Quetta.
Tel: (081) 831623, 831702
Fax: (081) 831922
helpdesk-qta@smeda.org.pk
January 2006
High School
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
Document No.
PREF-50
Revision
Prepared by
SMEDA-Punjab
Issue Date
August, 2002
Revised on
January, 2006
Issued by
Library Officer
1
PREF-50/January, 2006/Rev 2
High School
INTRODUCTION TO SMEDA ......................................................................1
PURPOSE OF THE DOCUMENT .................................................................1
CRUCIAL FACTORS & STEPS IN DECISION MAKING .........................2

3.1
STRENGTHS ..................................................................................................2
3.2
WEAKNESS ..................................................................................................2
3.3
OPPORTUNITIES............................................................................................2
3.4
THREATS......................................................................................................2
PROJECT PROFILE ......................................................................................2

4.1
OPPORTUNITY RATIONALE ...........................................................................2
4.2
PROJECT BRIEF ............................................................................................5
4.3
PROJECT COST .............................................................................................5
4.4
PROJECT RETURNS .......................................................................................5
4.5
VIABLE ECONOMIC SIZE ...............................................................................5
4.6
PROPOSED CAPACITY ...................................................................................5
4.7
PROPOSED BUSINESS LEGAL STATUS ............................................................6
CURRENT INDUSTRY STRUCTURE .........................................................6
MARKET ANALYSIS ....................................................................................8
MANPOWER REQUIREMENT ....................................................................9
FURNITURE/EQUIPMENT REQUIREMENT .......................................... 10
LAND AND BUILDING................................................................................ 10
10
REGULATIONS.........................................................................................10
11
FINANCIAL ANALYSIS........................................................................... 11
11.1
PROJECT COSTS ......................................................................................11
11.2
PROJECTED INCOME STATEMENT .............................................................12
11.3
PROJECTED BALANCE SHEET ...................................................................13
11.4
PROJECTED CASH FLOW STATEMENT.......................................................14
11.5
FEE INCOME............................................................................................15
11.6
ESTIMATED EXPENSES ............................................................................16

2
High School
11.7
TEACHERS ..............................................................................................20
11.8
SUBJECT DETAIL .....................................................................................21
12
KEY ASSUMPTIONS................................................................................22
12.1
FINANCIAL ASSUMPTIONS .......................................................................22
12.2
MISCELLANEOUS ASSUMPTIONS ..............................................................22
3
High School
1 INTRODUCTION TO SMEDA
The Small and Medium Enterprise Development Authority (SMEDA) was
established with the objective to provide fresh impetus to the economy through the
launch of an aggressive SME support program.
Since its inception in October 1998, SMEDA had adopted a sectoral SME
development approach. A few priority sectors were selected on the criterion of SME
presence. In depth research was conducted and comprehensive development plans
were formulated after identification of impediments and retardants. The allencompassing sectoral development strategy involved recommending changes in the
regulatory environment by taking into consideration other important aspects
including finance, marketing, technology and human resource development.
SMEDA has so far successfully formulated strategies for sectors including, fruits
and vegetables, marble and granite, gems and jewelry, marine fisheries, leather and
footwear, textiles, surgical instruments, transport and dairy. Whereas the task of
SME development at a broader scale still requires more coverage and enhanced
reach in terms of SMEDAs areas of operation.
Along with the sectoral focus a broad spectrum of business development services is
also offered to the SMEs by SMEDA. These services include identification of viable
business opportunities for potential SME investors. In order to facilitate these
investors, SMEDA provides business guidance through its help desk services as well
as development of project specific documents. These documents consist of
information required to make well-researched investment decisions. Pre-feasibility
studies and business plan development are some of the services provided to enhance
the capacity of individual SMEs to exploit viable business opportunities in a better
way.
This document is in the continuation of this effort to enable potential investors to
make well-informed investment decisions.
2 PURPOSE OF THE DOCUMENT

The objective of the pre-feasibility study is primarily to facilitate potential
entrepreneurs to facilitate investment and provide an overview about a high school
business. The project pre-feasibility may form the basis of an important investment
decision and in order to serve this objective, the document covers various aspects of
the business concept development, start-up, production, marketing, and finance and
business management.
This particular pre-feasibility is regarding High School which comes under
Service sector.
1
High School
CRUCIAL FACTORS & STEPS IN DECISION MAKING
3.1 Strengths
Low Student teacher ratio (less than 20 students/teacher at full capacity)

Reasonable space per student (12 sq. ft per student)
Helping and guiding attitude of teachers
Competent teaching faculty
Dynamic Leadership
Well maintained order and discipline
Environment conducive to joyful learning
Availability of adequate facilities
Availability of liquid cash due to advance collection of fees
3.2 Weakness
Difficulty in building confidence of the community

Initially poor intake of students
Operating loss in the initial year due to unabsorbed fixed cost
Difficult in building confidence of the community
3.3 Opportunities
Government incentives and policies conducive for private investment in

education sector
Gap between number of school going age children and actual enrolments in
schools
General public awareness (especially in urban areas) about importance of
education
3.4 Threats
New entrants can easily share the business
PROJECT PROFILE
4.1 Opportunity Rationale

The importance of education for human resource development does not need any
elucidation. Globally, it has been observed that countries attached the highest
priority to education since the development of other sectors like health, agriculture
and industry is dependent on the development of education in the country. The
Government of Pakistan accepts education as fundamental right for its citizens as
well as its commitment to provide access to education to every citizen. But the
Government faces constraints due to limited financial resources to spend on
2
High School
education sector. Therefore, the private sector investment is being encouraged with
various incentives to lower the burden of the Government.
During the fiscal year 2004-05, the total education budget is estimated to be Rs.
86.264 billion, including development budget of Rs. 12.380 billion and recurring
budget of Rs 73.884 billion. For the year 2004-05, Ministry of Education had
initially allocated Rs 3359.04 million in the PSDP for 72 development projects.
During the mid year review, this allocation was revised to Rs 2025.12 million. For
the year 2005-06, an amount of Rs 11.2 billion has been demanded by this Ministry
for PSDP. However, the Priorities Committee agreed to an amount of Rs 3.8 billion
for major programs.
The education budget as percentage of GDP is given in Table below.
Table 4.1:
Year
National Education Budget during 1995-96 to 2004-051 (Rs. Billion)

Recurring
Budget
Development
Budget
Total Education
Budget
% of
GDP
1995-96
39.610
2.585
42.195
2.00
1996-97
40.536
1.968
42.504
2.62
1997-98
46.100
2.984
49.084
2.34
1998-99
46.979
2.427
49.406
2.40
1999-00
51.572
2.430
54.002
1.70
2000-01
54.396
1.966
56.362
1.60
2001-02
64.975
8.770
73.745
2.00
2002-03
87.601
3.873
111.475
2.00
2003-04
73.884
12.380
86.264
1.92
2004-05
94.142
33.616
127.759
2.14
Although, traditionally, private schools have been a luxury only the rich can afford,
this is not necessarily the case in the current re-emergence of the private sector in
Pakistan's education system.
Keeping in view the significant and emerging role of the private sector in the
promotion of education at various levels, the Government has introduced the concept
of Public-Private Partnership. The suggested incentives to private sector educational
institutions are:
Provision of free land, or land on concessional rates in rural/urban areas

Property tax exemption on school buildings
Exemption of 50% income tax to private sector institutions for their faculty,
management and support staff
Source: Economic Survey of Pakistan

3
High School
Utilities availability on non-commercial rates

Extension of matching grants for establishing rural schools
Exemption of custom duties on import of educational equipment
Undertaking necessary legislation to give Charter to private sector institutions
and facilitating their day to day affairs
Private schooling has now become important for the country. Enrolment in private
primary schools is now in the order of 42 percent of total enrolment (2004). During
2004, at the middle school level, the private sector had a share of 37 percent of total
enrolment.
Enrolment at primary school level
Enrolment at middle school level
Private
Schools *
37%
Private
Schools
*
42%
Govt.
Schools
58%
Govt.
Schools
63%
At the secondary and higher secondary level in the same year, the private sector
share was 30 percent and 64 percent respectively of the total enrolment.2
Enrolment at secondary school
level
Private
Schools
*
30%
Enrolment at higher secondary

school level
Private
Schools *
36%
Govt.
Schools
70%
Govt.
Schools
64%
Source: A study on National Sample Survey of Private School in Pakistan, AEPAM, Ministry of
Education, 2004
* Private Sector data is estimated
4
High School
4.2 Project Brief

This study describes the investment opportunity regarding setting up of high school
in any big city of Pakistan to provide education to the children of medium and lower
medium income group.3 The school can start its operation by starting classes from
nursery to Metric (Secondary school).
By offering quality education and modern facilities, the school is expected to earn
early recognition and parents trust and preference. The school can be opened in big
cities like Karachi, Lahore, Islamabad, Peshawar, Quetta, Multan, Hyderabad,
Faisalabad, etc. The area should be selected near the residents of medium income
group.
4.3 Project Cost
Initial project cost is Rs. 2.399 million. The proposed pre-feasibility is based on the
assumption of 50% debt and 50% equity. However this composition of debt and
equity can be changed as per the requirement of the investor.
4.4 Project Returns
The project seems to be viable with 40% internal rate of return and a pay back period
of 3.44 years. The net present value of the project is Rs. 32.866 million. Discount
rate used for NPV is 23%.
4.5 Viable Economic Size
Since, it is a service sector project, there is no hard and fast criterion for viable
economic size, rather it depends upon many factors like faculties needed
infrastructure requirements, schools fixed overhead.
4.6 Proposed Capacity
For the purpose of this feasibility study, strength of 750 students has been proposed.
However, this capacity will be attained gradually in a period of 10 years
The information provided in this pre-feasibility study may be used for establishing such a school in
any city of Pakistan. However, data on the existing schools has been provided for the province of
Punjab only.
5
Table 4.2:
High School
Year wise Number of Students
Students/Year
Year
1
Year
2
Year
3
Year
4
Year
5
Year
6
Year
7
Year
8
Year
9
Year
10
Senior Section
(V - X)
50
139
93
238
275
305
330
349
364
375
Junior Section
(Nursery-IV)
100
139
193
238
275
305
330
349
364
375
Total Students
150
278
386
475
550
611
660
699
728
750
4. 7
Proposed Business Legal Status
The proposed legal structure of the business entity may be either sole proprietorship
or partnership. Although selection totally depends upon the choice of the
entrepreneur but this financial feasibility is based on a Sole Proprietorship.
CURRENT INDUSTRY STRUCTURE
Education is key to change and progress, therefore, Government of Pakistan has

adopted this sector as one of the pillars for poverty reduction and benefit of masses.
Government is fully committed to provide best Educational Facilities to its people
within the minimum possible time
Overall literacy rate of 52 percent has increased by about two percentage points
compared to that of Labor Force Survey (LFS), 2001-02. The data shows that rural
household is generally deficient in human capital. For instance, 70 percent urban
literacy rate is 28 percentage points higher than that of rural. As expected, male
population is more literate compared to female and male literacy level (64%) is
about 25 percentage points higher than that of females (39%). Comparatively high
incidence of illiteracy among female may be due to their limited access to the
available educational facilities. A comparative picture of literary areas of both sexes,
male & female by province and rural /urban areas for the two surveys, 2001-02 &
2003-04 Census is given in table below:
6
Table 5-1
High School
Literary Rates4
Province/Area
Total
50.0
40.5
67.8
33.5
2001-02
Male Female
62.2
36.9
55.0
25.4
75.5
59.3
47.4
16.3
Total
53.0
41.6
69.7
36.0
2003-04
Male
Female
56.3
26.6
76.5
62.5
52.1
17.6
PAKISTAN
Rural
Urban
BALOCHISTA
N
RURAL
26.8
40.8
9.4
27.7
43.9
9.2
59.4
73.9
42.3
60.7
75.9
42.9
URBAN
NWFP
39.3
58.4
19.9
43.0
61.8
25.2
RURAL
35.9
55.9
15.9
39.8
59.2
21.7
URBAN
56.6
70.4
41.3
58.3
74.0
42.6
PUNJAB
51.8
62.3
40.8
53.3
63.6
42.9
RURAL
44.3
56.6
31.7
45.1
57.7
32.6
URBAN
67.4
73.7
60.5
69.8
75.1
64.2
SINDH
54.9
67.0
41.0
55.3
66.9
42.2
RURAL
36.0
52.9
16.3
35.6
53.3
15.7
URBAN
71.0
79.1
61.8
72.4
78.8
65.3
The country is making a major effort to expand access to primary education. It now
has a total of 154,970 primary schools in 2003-04 with an enrolment of 19,794
million students and 432,222 teachers. The rural- urban distribution of institutions in
the public sector is given below:
Table 5-2
Total Primary Schools
Level
Urban
Rural
Total
Public Sector
12,423
121,529
133,952
Private Sector
9,072
8,549
17,621
5
Other Public Sector
453
2,944
3,397
Total
21,948
133,022
164,970
At the middle school level access to education has increased. The number of middle
schools has increased up to 28,728 both in rural and urban areas in the year 2003-04.
The total middle schools enrolment has increased from 3.918 million during the year
2002-03 to 4.318 million during the year 2003-04. The increase in enrolment has
taken place in both rural and urban areas.
Source: Economic Survey 2004-05

Other public sector means institutions managed by Ministries/Divisions/ Department other than the
Ministry of Education/Education Departments
7
Table 5-3
High School
Total Middle Schools
Level
Public Sector
Private Sector
Other Public Sector
Total
Table 5-4
Level
Public Sector
Private Sector
Other Public
Sector
Total
Urban
1,897
8,853
60
10,810
Rural
11,771
6,147
-17,918
Total
13,668
15,000
60
28,728
Total Middle Enrolment

Urban
1,229,325
851,346
70,693
Rural
1,846,353
320,129
875
Total
3,075,678
1,171,475
71,568
2,151,364
2,167,357
4,318,721
MARKET ANALYSIS
The proposed school will cater to the needs of children of medium income group.
Currently three categories of schools are being run in Pakistan, catering to three
main segments of the market, mainly higher medium and low-income groups. The
schools, which serve the high-income groups, are running in the private sector. They
usually charge high fees in the range of Rs. 3000 to Rs. 8,000 per month per student
e.g. Lahore American School, The City School, Lahore Lyceum and Aitcheson etc.
These schools have large facilities, enjoy repute due to their modern system of
education by using scientific techniques and have qualified and specialized faculty.
Most private schools fall in the second category having fee range from Rs. 500 to Rs.
3000. The third category (medium range) provides facilities even less than the
minimum required. These schools have less space per student (minimum required 12
sq. ft. per student for the recognition of the institute by the Board of Intermediate and
Secondary Education Lahore) and high students teacher ratio.
There is stiff competition amongst the school running in the market. Parents are
curious about the future of their children so they think extensively before admitting
their children in any school. Following are the main factors (not conclusive) on the
basis of which parents make choice of schools.
1.
2.
3.
4.
5.
6.
7.
Distance from home

School track record/history
General reputation
Fees
Qualification and experience of the head of school and other faculty.
Physical infrastructural facilities.
Courses offered and medium of instruction.
8
High School
Besides the above, there are some other subjective, social and status considerations
which also play an important role in making decision.
MANPOWER REQUIREMENT
Number of teachers & other staff required at first year (Year 1)

Table 7-1
Management Plan
Positions
Number
Faculty Members:
Subject Specialist
Senior Teacher
Junior Teacher
Administrative Staff
Principal
Accountant
Private Secretary
Librarian
Helpers / Peon
Maintenance Staff
Guards
Electrician / Plumber
Cleaner
Total:
9
Salary/month
(Rs.)
0
2
5
7,000
5,500
4,000
1
1
1
1
4
10,000
5,000
4,000
4,000
3,000
2
2
1
19
3,000
2,500
2,000
High School
FURNITURE/EQUIPMENT REQUIREMENT
Based on Second Years Capacity

Table 8-1
Furniture and Equipments
FURNITURE & EQUIPMENTS

Computers
Server
Printers (Laser )
Printers (Dot Matrix)
UPS
Electrical & Other Equipment
Science Labs (Instruments)
Furniture & Fixture
Library Books
Total
Quantity Price (Rs.) Amount (Rs)

20
15,000
300,000
1
30,000
30,000
1
20,000
20,000
1
7,500
7,500
2
8,500
17,000
361,060
150,000
902,450
70,000
1,858,010
L AND AND B UI L DI NG
For the purpose of this study, the option of getting a building for school on rent has
been recommended. Rent of the building is assumed to be Rs.50,000 for an
approximate area of 2 kanals. In the year six more space will be required to
accommodate increasing number of students. Another building will be acquired on
monthly rent of Rs. 30,000.
Though ideally, a purpose built building can best suit a school, however any building
in a peaceful environment can be rented out for the purpose.
10 REGULATIONS
The schools are required to be registered with the Education Department (Provincial)
in the office of Education Directorate Schools. The application is to be submitted on
a prescribed form and can be obtained from the department.
The next process is the recognition of institution from the relevant Board of
Intermediate and Secondary Education (BISE). The detailed regulations, rules and
requirement of minimum infrastructural facilities along with application form can be
obtained from the BISE office.
10
High School
11 FINANCIAL ANALYSIS
11.1 Project Costs
HIGH SCHOOL
Project Costs
Value in Rs.
Furniture & Fixtures

Air Conditioners & Electrical Items
Science Labs
Computer Labs
Library Books
902,450
361,060
150,000
374,500
70,000
89,401
1,947,411
Preliminary Cost (5%)
Capital Cost
Cash in hand
Prepaid rent (6 months)
Working Capital Required
151,397
300,000
451,397
Total Project Cost

Financed By:
2,398,808
Sponsors Equity
Bank Finance
50%
50%
Project Returns
Internal Rate of Return
Pay Back Period
Net Present Value
Yrs.
Rs. In Thousand
11
1,199,404
1,199,404
2,398,808
40%
3.44
32,866
High School
11.2 Projected Income Statement

HIGH SCHOOL
Projected Income Statement
Year - I
Revenue
Net Fee Income
Expenditures
Senior Administration Salaries
Faculty Salaries
Administration Salaries
Maintenance Staff Salaries
Other Expenses
Depreciation
2,901
120
348
300
156
1,190
445
2,559
Financial / Mark-up Charges

Mark-up on Running Finan.
Bank Loan
Total Expenditure
Net Profit/(Loss) before Tax
Year - II
6,327
126
592
315
189
1,354
411
2,988
-
148
148
2,707
117
117
3,105
Year - III
10,186
132
747
370
198
1,575
333
3,357
86
86
3,443
Year - IV
14,831
Year - V
20,390
Year - VI
27,012
Year - VII
Year - VIII
34,870
44,162
Rs. In Thousand
Year - IX
Year - X
55,113
67,985
139
1,111
389
208
1,800
293
3,941
146
1,575
408
219
1,902
252
4,502
153
1,953
429
230
2,038
346
5,148
161
2,115
499
241
2,148
299
5,462
169
2,313
523
253
2,263
254
5,775
177
2,500
550
266
2,381
222
6,096
186
2,625
577
279
2,504
215
6,386
55
55
3,995
23
23
4,526
5,148
5,462
5,775
6,096
6,386
194
3,222
6,744
10,835
15,864
21,864
29,408
38,386
49,017
61,600
68
1,128
2,360
3,792
5,552
7,652
10,293
13,435
17,156
21,560
Net Profit/(Loss) after Tax
126
2,095
4,383
7,043
10,312
14,212
19,115
24,951
31,861
40,040
Withdrawal of profit (Drawings)
126
126
2,095
126
2,221
4,383
2,221
6,604
7,043
6,604
13,647
3,000
7,312
13,647
20,959
6,700
7,512
20,959
28,470
8,000
11,115
28,470
39,586
9,500
15,451
39,586
55,037
11,000
20,861
55,037
75,898
13,000
27,040
75,898
102,937
Taxation
Accumulated Profit/(Loss) b/f

Accumulated Profit/(Loss) c/f
12
High School
11.3 Projected Balance Sheet

HIGH SCHOOL
Projected Balance Sheet
Year-0
Fixed Assets:
Furniture & Fixtures
Elec. & other Equipments
Computer Equipment
Library Books
Preliminary Cost
Total Fixed Assets
at Written Down Value
Year - I
Year - II
Year - III Year - IV
Rs. In Thousands
Year - V Year - VI Year - VII Year - VIII Year - IX Year - X
902
511
375
70
89
1,083
383
335
56
72
1,245
287
308
45
57
1,256
216
206
36
46
1,265
162
138
85
37
1,274
121
93
68
29
1,281
91
313
54
23
1,288
68
210
99
19
1,294
51
140
79
15
1,300
38
94
64
12
1,305
29
63
107
10
1,947
1,928
1,943
1,759
1,686
1,585
1,763
1,684
1,581
1,508
1,513
300
151
315
692
331
3,154
347
7,813
365
15,077
398
22,538
418
30,532
439
42,067
461
57,876
484
79,046
106,875
Total Assets
2,399
2,936
5,428
9,920
17,128
24,520
32,713
44,190
59,917
81,038
108,388
Owners Equity
Accumulated Profit/(Loss)
Long Term Loan
Short Term Running Finan.
Students Security
1,199
0
1,199
-
1,625
126
960
225
2,051
2,221
720
437
2,201
6,604
480
635
2,421
13,647
240
820
2,571
20,959
991
3,095
28,470
1,147
3,315
39,586
1,289
3,465
55,037
1,415
3,615
75,898
1,525
3,835
102,937
1,615
Total Liabilities & Owner's Equity 2,399
2,936
5,428
9,920
17,128
24,520
32,713
44,190
59,917
81,038
108,388
Current Assets
PrePaid Rent
Cash in Hand / Bank
13
High School
11.4 Projected Cash Flow Statement

HIGH SCHOOL
Projected Cash Flow Statement
Year 0
Profit/(Loss) from operations
Prepaid Building Rent
Depreciation
Total Sources
Application of Funds
Capital Expenditure
Taxation
Drawings
Re-payment of Loan
Re-payment to Shrt. Term Run. Finance
Cash Increase/(Decrease)
Opening Balance
Cash Balance
Short Term Loan
Closing Balance
Year - II
Year - III
Year - IV
3,222
(16)
411
3,618
6,744
(17)
333
7,061
10,835
(17)
293
11,111
15,864
(33)
252
16,083
1,199
2399
426
225
651
426
212
637
150
199
349
220
185
405
150
171
321
2,099
1,275
4,255
7,409
16,403
1199
1,947
426
68
240
1,947
733
151
0
151
0
151
541
151
692
0
692
426
1,128
240
1,793
2,462
692
3,154
0
3,154
150
2,360
240
2,750
4,659
3,154
7,813
0
7,813
14
Year - V
194
(15)
445
624
-300
(300)
Sources of Funds
Owners:
- Equity
Students Security
Bank Finance
Year - I
11,516
220
3,792
240
4,252
150
5,552
3,000
240
8,942
7,263
7,813
15,077
0
15,077
7,461
15,077
22,538
0
22,538
Rs. In Thousand
Year - VI Year - VII Year - VIII Year - IX Year - X
21,864
(20)
346
22,191
29,408
(21)
299
29,686
38,386
(22)
254
38,618
49,017
(23)
222
49,216
525
156
681
220
141
361
150
126
276
150
110
260
22,871
30,048
38,894
525
7,652
6,700
14,877
7,994
22,538
30,532
0
30,532
220
10,293
8,000
18,513
11,535
30,532
42,067
0
42,067
150
13,435
9,500
23,085
15,809
42,067
57,876
0
57,876
61,600
484
215
62,298
220
90
310
49,476
62,609
150
17,156
11,000
28,306
220
21,560
13,000
34,780
21,170
57,876
79,046
0
79,046
27,829
79,046
106,875
0
106,875
High School
11.5 Fee Income

Fee Income
Year - I
Per
Student
Number of Students
New
Old
#
1
Year - II
Rupees
Per
Student
150
150
Non-Operating R evenue
Security (Refundable)
Registration Fee
Admission Fee
Operating R evenue
Monthly Fee
Junior B ranch
150
Nursery to Prep
300
I to IV
450
Senior Branch
200
V to V III
100
IX to X (Matric)
300
750
No.
No.
Year - III
Rupees
Per
Student
135
143
278
Year - IV
No.
Rupees
Per
Student
122
264
385
No.
Year - V
Rupees
Per
Student
109
366
475
No.
Rupees
98
451
550
1,5 00
225,000
1,6 50
222,750
1,8 15
220,523
1,997
218,317
2,196
216,1 34
1,5 00
2,0 00
225,000
300,000
525,000
1,6 50
2,2 00
222,750
297,000
519,750
1,8 15
2,4 20
220,523
294,030
514,553
1,997
2,662
218,317
291,090
509,407
2,196
2,928
216,1 34
288,1 79
504,3 13
50
60
110
600,000
1,008,000
1,608,000
1,2 00
1,6 80
799,200
2,237,760
3,036,960
1,4 40
2,0 16
77
154
231
1,3 30,992
3,7 26,778
5,0 57,770
1,728
2,419
95
190
285
1,970,827
5,518,316
7,489,143
2,074
2,903
110
220
330
2,7 36,5 19
7,6 62,2 53
10,3 98,7 72
40
768,000
768,000
1,9 20
2,4 00
1,704,960
1,065,600
2,770,560
2,3 04
2,8 80
103
51
154
2,8 39,450
1,7 74,656
4,6 14,106
2,765
3,456
127
63
190
4,204,431
2,627,770
6,832,201
3,318
4,147
40
147
73
220
5,8 37,9 07
3,6 48,6 92
9,4 86,5 99
150
2,901,000
1,0 00
1,4 00
1,6 00
2,0 00
Net Fee
56
111
167
1
74
37
111
278
6,327,270
385
10,1 86,4 28
475
14,830,751
550
20,3 89,6 85
Fee Income (continued)

Year - V I
Per
Student
Number of Students
New
Old
Non-Operating R evenue
Security (Refundable)
Registration Fee
Admission Fee
Operating R evenue
Monthly Fee
Junior B ranch
150
Nursery to Prep
300
I to IV
450
Senior Branch
200
V to V III
100
IX to X (Matric)
300
750
Net Fee
No.
Year - V II
Rupees
Per
Student
89
522
611
No.
Year - VIII
Rupees
Per
Student
80
580
660
Year - IX
Rupees
Per
Student
72
627
699
No.
Year - X
Rupees
Per
Student
65
664
728
No.
Rupees
58
692
750
1,6 11
142,649
1,7 72
141,222
1,9 49
139,810
2,144
138,412
2,358
137,0 28
1,6 11
2,4 16
142,649
213,973
356,621
1,7 72
2,6 57
141,222
211,833
353,055
1,9 49
2,9 23
139,810
209,715
349,525
2,144
3,215
138,412
207,618
346,029
2,358
3,537
137,0 28
205,5 41
342,5 69
1,4 93
1,8 66
122
244
367
2,189,154
5,472,885
7,662,039
1,7 92
2,2 39
132
264
396
2,838,400
7,096,001
9,934,401
2,1 50
2,6 87
140
280
419
3,6 05,962
9,0 14,906
12,6 20,8 68
2,580
3,225
146
291
437
4,510,598
11,276,495
15,787,093
3,096
3,870
150
300
450
5,5 73,8 67
13,9 34,6 67
19,5 08,5 34
2,1 15
2,4 88
163
81
244
4,135,068
2,432,393
6,567,462
2,5 38
2,9 86
176
88
264
5,361,423
3,153,778
8,515,201
3,0 46
3,5 83
186
93
280
6,8 11,262
4,0 06,625
10,8 17,8 87
3,655
4,300
194
97
291
8,520,018
5,011,776
13,531,794
4,386
5,160
200
100
300
10,5 28,4 15
6,1 93,1 85
16,7 21,6 00
611
14,586,122
660
18,802,657
699
15
No.
23,7 88,2 80
728
29,664,916
750
36,5 72,7 03
High School
11.6 Estimated Expenses
Estimated Recurring Expenditure

Year - I
Year - II
Year - III
Total for
Total for the
Total for
No. Monthly the Year No. Monthly
No. Monthly the Year
Year
(Rupees)
(Rupees)
(Rupees)
Year - IV
Year - V
Total for the
Total for the
No. Monthly
No. Monthly
Year
Year
(Rupees)
(Rupees)
Salary & Allowances

Administration:
Principal
10,000
120,000
120,000
10,500
126,000
126,000
11,025
132,300
132,300
11,576
138,915
138,915
12,155
145,861
145,861
Faculty Member:
Subject Specialist
Senior Teachers
Junior Teachers
7,000
2
5,500
4,000
7,350
176,400
7,718
185,220
8,103
388,962
8,509
612,615
132,000
5,775
138,600
6,064
218,295
6,367
305,613
6,685
320,894
216,000
4,200
277,200
4,410
4,631
416,745 11
4,862
348,000 10
592,200 12
343,980
747,495
16
1,111,320
21
641,787
1,575,296
Manegerial Staff
Accountant
5,000
60,000
5,250
63,000
5,513
66,150
5,788
69,458
6,078
72,930
Private Secretary
4,000
48,000
4,200
50,400
4,410
52,920
4,631
55,566
4,862
58,344
Librarian
4,000
48,000
4,200
50,400
4,410
52,920
4,631
55,566
4,862
58,344
Helpers / Peon
4
7
3,000
144,000
300,000
4
7
3,150
151,200
315,000
5
8
3,308
198,450
370,440
5
8
3,473
208,373
388,962
5
8
3,647
218,791
408,410
2
2
1
5
20
3,000
2,500
2,000
72,000 2
60,000 2
24,000 2
156,000 6
924,000 24
3,150
2,625
2,100
75,600 2
63,000 2
50,400 2
189,000 6
1,222,200 27
3,308
2,756
2,205
79,380 2
66,150 2
52,920 2
198,450 6
1,448,685 31
3,473
2,894
2,315
83,349 2
69,458 2
55,566 2
208,373 6
1,847,570 36
3,647
3,039
2,431
87,516
72,930
58,344
218,791
2,348,358
Maintenance Staff :
Guards
Elect./Plumber
Cleaner
Total Staff
16
High School
Estimated Recurring Expenditure (continued)

Year - VIII
Year - VI
Year - VII
Total for
Total for the
Total for
No. Monthly the Year
Year
(Rupees)
(Rupees)
(Rupees)
Salary & Allowances
Administration:
Principal
Faculty Member:
Subject Specialist
Senior Teachers
Junior Teachers
Ministerial Staff :
Accountant
Private Secretary
Librarian
Helpers / Peon
Maintenance Staff :
Guards
Elect./Plumber
Cleaner
Total Staff
1
1
12,763
8
5
11
24
8,934
7,020
5,105
1
1
1
5
8
6,381
5,105
3,829
2,553
76,577
61,262
45,946
153,154
336,938
1
1
1
6
9
6,700
5,360
4,020
2,680
80,406
64,325
48,243
192,974
385,948
1
1
1
6
9
7,036
5,628
4,221
2,814
84,426
67,541
50,656
202,622
405,245
1
1
1
6
9
7,387
5,910
4,432
2,955
88,647
70,918
53,188
212,754
425,507
2
2
2
6
3,829
2,553
1,914
91,892
61,262
45,946
199,100
2
2
2
6
4,020
2,680
2,010
96,487
64,325
48,243
209,055
2
2
2
6
4,221
2,814
2,111
101,311
67,541
50,656
219,508
2
2
2
6
4,432
2,955
2,216
3,106,878
43
39
153,154
153,154
1
1
13,401
857,661 8
421,173 5
673,877 12
1,952,711 25
9,381
7,371
5,360
2,641,903 41
160,811
160,811
1
1
14,071
900,544 8
442,232 6
771,895 12
2,114,671 26
9,850
7,739
5,628
2,870,485 42
17
168,852
168,852
Year - IX
Year - X
Total for the
Total for the
No. Monthly
No. Monthly
Year
Year
(Rupees)
(Rupees)
1
1
14,775
945,571 8
557,212 6
810,490 13
2,313,273 27
10,342
8,126
5,910
177,295
177,295
1
1
15,513
186,159
186,159
992,850 8
585,072 6
921,932 13
2,499,855 27
10,859
8,532
6,205
1,042,493
614,326
968,029
2,624,847
1
1
1
6
9
7,757
6,205
4,654
3,103
93,080
74,464
55,848
223,391
446,783
106,377
70,918
53,188
230,483
2
2
2
6
4,654
3,103
2,327
111,696
74,464
55,848
242,007
3,333,139
43
3,499,796
High School
Year - I
Year - II
Total for
Total for the
No.
Year
(Rupees)
(Rupees)
Other Operating Expenses :
Printing & Stationery
10,000
10,500
News Papers & Periodicals
500
525
Utilities ( Tele. Elect. Gas. Water etc.)
427,474
448,848
Postage
12,000
12,600
Misc. Office Exp.
24,000
25,200
Advertisement (Lump Sum)
60,000
54,000
Laboratory Expenses
60,000
Sports Expenses
12,000
Repair & Maintenance
30,000
Medical Expenses
12,000
building Rent
600,000
630,000
School Magazine
Gardening Expenses
6,000
6,300
Consultancy Charges & Audit Fee
50,000
52,500
Students Function (Lump Sum)
Sub Total
1,189,974
1,354,473
Total
2,113,974
2,576,673
18
Year - III
Total for
the Year
(Rupees)
11,025
12,000
471,291
30,000
26,460
48,600
63,000
36,000
60,000
24,000
661,500
69,323
6,615
55,125
1,574,938
3,023,623
Year - IV
Year - V
Total for the
Total for the
No. Monthly
No. Monthly
Year
Year
(Rupees)
(Rupees)
11,576
12,600
494,855
31,500
27,783
43,740
66,150
72,000
63,000
25,200
694,575
92,668
6,946
57,881
100,000
1,800,474
3,648,043
12,155
13,230
519,598
33,075
29,172
39,366
69,458
75,600
66,150
26,460
729,304
115,473
7,293
60,775
105,000
1,902,109
4,250,467
High School
Year - VI
Year - VII
Total for
Total for the
No.
Year
(Rupees)
(Rupees)
Other Operating Expenses :
Year - VIII
Total for
the Year
(Rupees)
Year - IX
Year - X
Total for the
Total for the
No. Monthly
No. Monthly
Year
Year
(Rupees)
(Rupees)
Printing & Stationery

News Papers & Periodicals
Utilities ( Tele. Elect. Gas. Water etc.)
Postage
Misc. Office Exp.
Advertisement (Lump Sum)
Laboratory Expenses
Sports Expenses
Repair & Maintenance
Medical Expenses
School Magazine
Gardening Expenses
Consultancy Charges & Audit Fee
Students Function (Lump Sum)
Sub Total
12,763
13,892
549,733
34,729
30,631
35,429
72,930
79,380
69,458
27,783
137,464
7,658
63,814
110,250
1,245,914
13,401
14,586
577,220
36,465
32,162
31,886
76,577
83,349
72,930
29,172
158,429
8,041
67,005
115,763
1,316,986
14,071
15,315
606,081
38,288
33,770
28,698
80,406
87,516
76,577
30,631
178,209
8,443
70,355
121,551
1,389,911
14,775
16,081
636,385
40,203
35,459
25,828
84,426
91,892
80,406
32,162
196,691
8,865
73,873
127,628
1,464,674
15,513
16,885
668,204
42,213
37,232
23,245
88,647
96,487
84,426
33,770
213,800
9,308
77,566
134,010
1,541,308
Total
3,887,816
4,121,987
4,187,471
4,532,587
4496789.11
4,828,433
4,797,814
5,125,022
5041103.993
5,423,030
19
High School
11.7 Teachers
Teachers
Year - I
Period
Faculty Members:
Subject Specialist
Senior Teacher
Junior Teacher
No.
Year - II Year - III Year - IV

Period
0
2
5
7
No. Period
No.
2
2
6
10
2
3
7
12
Period
Year - V
No. Period
No.
4
4
8
16
6
4
11
21
Year - VI
Year -VII Year - VIII Year -IX
Period
Period
No.
8
5
11
24
No.
Period
8
5
12
25
No.
Period
8
6
12
26
No.
Year X
Period
8
6
13
27
No.
8
6
13
27
Standard teacher required :

Senior Classes ( Class V - X)
Number of students
Students in a class
Junior Classes (Class Nursery - IV)

Number of students
Students in a class
5
111
25
154
25
190
25
220
25
8.8
244
25
10
264
25
11
280
25
11
291
25
12
300
25
12
167
25
231
25
285
25
11
330
25
13
367
25
15
396
25
16
419
25
17
437
25
17
450
25
18
20
High School
11.8 Subject Detail
Subject Detail
Classes
Subjects
Urdu
English
Maths
Computer sciences
Science
Art
Pak. Studies
Geography
History
Islamyat
Physics
Chemistry
Biology/Computer
Arabic
II
III
IV
21
VI
VII
VIII
IX
High School
12 KEY ASSUMPTIONS
12.1 Financial Assumptions
Interest Rate on
Short Term Loan
Long Term Loan
Project Financing
14%
13%
Equity
Debt
Long Term Loan Repayment (Yrs)
50%
50%
5
12.2 Miscellaneous Assumptions

Salaries growth rate
Expense growth rate
Depreciation on: (Written Down Value)
Furniture & Fix.
Elec. & other Equipments
Computer Equipment
Preliminary Cost
Tax Rate
Cash in Hand (Days)
10%
5%
10%
25%
33%
5%
35%
30
22

Pre-Feasibility Study for Proposed High School

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Pre-Feasibility Study

Small and Medium Enterprise Development Authority

8th Floor, LDA Plaza,

5TH Floor, Bahria

Bungalow No. 15-A

INTRODUCTION TO SMEDA ......................................................................1

PURPOSE OF THE DOCUMENT .................................................................1

CRUCIAL FACTORS & STEPS IN DECISION MAKING .........................2

PROJECT PROFILE ......................................................................................2

OPPORTUNITY RATIONALE ...........................................................................2

PROJECT BRIEF ............................................................................................5

PROJECT COST .............................................................................................5

PROJECT RETURNS .......................................................................................5

VIABLE ECONOMIC SIZE ...............................................................................5

PROPOSED CAPACITY ...................................................................................5

PROPOSED BUSINESS LEGAL STATUS ............................................................6

CURRENT INDUSTRY STRUCTURE .........................................................6

MARKET ANALYSIS ....................................................................................8

MANPOWER REQUIREMENT ....................................................................9

FURNITURE/EQUIPMENT REQUIREMENT .......................................... 10

LAND AND BUILDING................................................................................ 10

PROJECT COSTS ......................................................................................11

PROJECTED INCOME STATEMENT .............................................................12

PROJECTED BALANCE SHEET ...................................................................13

PROJECTED CASH FLOW STATEMENT.......................................................14

ESTIMATED EXPENSES ............................................................................16

SUBJECT DETAIL .....................................................................................21

FINANCIAL ASSUMPTIONS .......................................................................22

MISCELLANEOUS ASSUMPTIONS ..............................................................22

2 PURPOSE OF THE DOCUMENT

CRUCIAL FACTORS & STEPS IN DECISION MAKING

Low Student teacher ratio (less than 20 students/teacher at full capacity)

Difficulty in building confidence of the community

Government incentives and policies conducive for private investment in

New entrants can easily share the business

4.1 Opportunity Rationale

National Education Budget during 1995-96 to 2004-051 (Rs. Billion)

Provision of free land, or land on concessional rates in rural/urban areas

Source: Economic Survey of Pakistan

Utilities availability on non-commercial rates

Enrolment at middle school level

Enrolment at higher secondary

4.2 Project Brief

Year wise Number of Students

Proposed Business Legal Status

CURRENT INDUSTRY STRUCTURE

Education is key to change and progress, therefore, Government of Pakistan has

Total Primary Schools

Source: Economic Survey 2004-05

Total Middle Schools

Total Middle Enrolment

Distance from home

Number of teachers & other staff required at first year (Year 1)

Based on Second Years Capacity

Furniture and Equipments

FURNITURE & EQUIPMENTS

Quantity Price (Rs.) Amount (Rs)

Furniture & Fixtures

Preliminary Cost (5%)

Total Project Cost

11.2 Projected Income Statement

Financial / Mark-up Charges