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PROJECT FEASIBILITY REPORT ON R.K.O.

INSTITUTE OF MANAGEMENT

INTRODUCTION
PROJECT BRIEF
Describes the investment opportunity about setting up a Institute of providing educational & training services in Management sector. Institute is established in outskirts of Delhi. It offer following courses in the initial phase :1. MBA 2. MBA Actuarial Sciences 3. MBA Banking R.K.O. 4. MBA insurance business 5. MBA computer aided management 6. MBA international business

PROJECT COST
Total investment in the project is around Rs.10 crores including a working capital requirement of approx Rs. 5.40 crore.
Total Investment (Rs.) Capital Cost * Working Capital * 10,00,00,000 4,59,70,000 5,40,30,000

PROPOSED COURSES
NAME OF THE COURSE MBA MBA Actuarial Sciences MBA Banking MBA insurance business MBA CAM MBA international business EXPECTED STUDENTS 60 60 60 60 60 60 SUGGESTED FEE (in Rs.) 50,000 50,000 50,000 50,000 50,000 50,000

CURRENT INDUSTRY SCENARIO


In 1950, the Department of Commerce of the Andhra University started the first M.B.A. program in India. In 1963, Indian Institute of Management, Ahmadabad was set up in collaboration with the Harvard Business School. The 1950s and 1960s witnessed the growth of commerce education and 1970s and 1980s witnessed the growth of Management Education in India. Since then there has been a tremendous growth of management institutes in our society but still there is a very much need for more of them.

TECHNICAL FEASIBILITY
PROPOSED CAPACITY
The capacity of the R.K.O Institute of Management at any point in time is almost 400 students per annum.

INDUSTRY OVERVIEW
On India, around 1 lakh management students become graduates and from which around 66.16 % students take Post-Graduate courses in management. In year 2000 there are 70,000 MBA seats offered by the institutes which is now increased to 1,20,000 seats in the year 2009 which is a increase of 71.4 % and is expected to increase further on.

OF THE CAMPUS
LAYOUT
2 Management buildings :20 Class Rooms 6 Staff rooms 4 Labs 12 Toilets 1 Conference Room 1 Auditorium 1 Library 1 seminar room

Description

R.K.O Blue Prints

Administrative Office Building

R.K.O.

Cafeteria

Play Ground

Parking

POWER ESTIMATION
The power consumed in the institute will be of approx Rs.20,00,000 consuming an estimated amount of 4,00,000 units of electricity at the rate of Rs.5 per unit.

R.K.O

MANPOWER REQUIREMENTS Post No. of persons Salary/Month


Director Deputy director Registrar Administrative staff Accounts department Student counselor Faculty Visiting Faculty (Per Hour) Maintenance staff Office boys 1 1 1 10 10 2 25 10 2 5 Rs. 70,000 Rs. 55000 Rs. 50,000 Rs. 3,00,000 Rs. 3,00,000 Rs. 50,000 Rs. 8,75,000 Rs. 50,000 Rs. 25,000 Rs. 2,00,000

POWER

RK O

The cleaning and security agency will be outsourced from Classic Facility Management Services (cleaning) and Securicar Services (security) at an annual contract for 3 years and 2 years respectively. The annual amount payable to Classic Facility Management Services is Rs. 1,20,000. The annual amount payable to Securicar Services is Rs. 2,00,000 with certain clauses.

SALES PROJECTION
open invitations to the prospective candidates i.e. a total of 100 students in the first year. 200 students and 400 students through its massive promotional strategies in 2nd year and 3rd year respectively.

MARKET ANALYSIS
TARGET MARKET
It is divided into various market segments which depends primarily on the city and locality in which this institute is to be established. This target market is divided into two major groups : Students candidates coming directly from graduation. Candidates with work experience.

STRATEGIC PLAN

of high quality education and that too in cities & places where quality education is not easily available. Good quality education would mean hiring qualified instructors and offering a reasonably wide range of education services in a technologically well equipped environment.
O K R

Provision

FINANCIAL FEASIBILITY
CAPITAL REQUIREMENTS
TOTAL INVESTMENT 10,00,00,000 MRB 2,00,00,000 MR A 2,00,00,000 Rohit Gujral Collections Ltd. 3,50,00,000 Bank Loan 2,50,00,000

EQUIPMENT Equipments Cost (in Rs.) DETAILS Units


Lab Equipments Computers Printers UPS (Local) UPS (Imported) Server Networking Hubs Nodes Cabling (Feet) Patch Cables Media Projector Multimedia Projector Telephones Air conditioners Total Equipment Cost Furniture & Fixtures Total Fixed Cost 5 10 1000 50 1 30 40 16,000 500 5 40 167,000 50,000 900 60 4 13 1 1 20000 15,000 10,000 60,000 25,000

Total Cost (in Rs.)


12,00,000 60,000 1,30,000 60,000 25,000

32,000 5,000 5,000 2,000 1,67,000 15,00,000 36,000 75000 3,29,70,000 30,00,000 3,59,70,000

FINANCIAL STATEMENTS

CASH ACCOUNT FOR THE YEAR 1 Particulars


opening balance Fees Recd interest on FD @ 10 % p.a
Cafeteria

Amount (in Rs.)

Particulars

Amount (in Rs.)


12,00,000 2,40,00,000 2,40,000 12,00,000 2,37,00,000 24,00,000 10,00,000 10,000 1,68,80,000

5,40,30,000Administrative expenses 1,50,00,000 Rental 10,00,000 Communication Expenses


6,00,000 promotional expenses

Salary Power Interest on Loan @ 10% p.a AICTE registration chg closing balance

Total

7,06,30,000

7,06,30,000

CASH ACCOUNT FOR THE YEAR 2 Particulars


opening balance Fees Recd interest on FD @ 10 % p.a
Cafeteria

Amount (in Rs.)


1,68,80,000

Particulars

Amount (in Rs.)

4,50,00,000Administrative expenses 10,00,000 Rental


6,00,000 Communication Expenses

12,00,000 2,40,00,000 2,40,000 12,00,000 2,37,00,000 24,00,000 10,00,000 97,40,000

promotional expenses Salary Power Interest on Loan @ 10% p.a closing balance

Total

6,34,80,000

6,34,80,000

CASH ACCOUNT FOR THE YEAR 3 Particulars


opening balance Fees Recd interest on FD @ 10 % p.a
Cafeteria

Amount (in Rs.)


97,40,000

Particulars

Amount (in Rs.)

6,00,00,000Administrative expenses 10,00,000 Rental


6,00,000 Communication Expenses

12,00,000 2,40,00,000 2,40,000 12,00,000 2,37,00,000 24,00,000 10,00,000 1,76,00,000

promotional expenses Salary Power Interest on Loan @ 10% p.a closing balance

Total

7,13,40,000

7,13,40,000

INCOME STATEMENT
Particulars Year 1 ( in Rs.) Year 2 (in Rs.) Year 3 ( in Rs.)

Revenues (A)

1,50,00,000

4,50,00,000

6,00,00,000

General and administrative expenses Administrative expenses Rental Communication Expenses promotional expenses Salary Power Interest on Loan @ 10% p.a Depreciation on equipment Depreciation on furniture AICTE registration chg 12,00,000 2,40,00,000 2,40,000 12,00,000 2,37,00,000 24,00,000 10,00,000 32,97,000 3,00,000 10,000 12,00,000 2,40,00,000 2,40,000 12,00,000 2,37,00,000 24,00,000 10,00,000 32,97,000 3,00,000 12,00,000 2,40,00,000 2,40,000 12,00,000 2,37,00,000 24,00,000 10,00,000 32,97,000 3,00,000

Subtotal (B) Operating income (A-B)

5,73,47,000 (4,23,47,000)

5,73,37,000 (1,23,37,000)

5,73,37,000 26,63,000

Other incomes Cafeteria Interest on FD @ 10% pa Net Profit / Loss 6,00,000 10,00,000 (4,07,47,000) 6,00,000 10,00,000 (1,07,37,000) 6,00,000 10,00,000 42,63,000

BALANCE SHEET Particulars Year 1 ( in Rs.) Year 2 ( in Rs.) Year 3 ( in Rs.)

ASSETS
Fixed Assets Fixed deposits 1,00,00,000 1,00,00,000 1,00,00,000

Equipment less: depreciation

3,29,70,000

2,96,73,000

2,63,76,000

32,97,000 2,96,73,000 32,97,000 2,63,76,000 32,97,000 2,30,79,000

Furniture & fixtures

30,00,000

27,00,000

24,00,000

less: depreciation

3,00,000

27,00,000 47,93,000

24,00,000

3,00,000

21,00,000

Current Assets Cash in hand and bank Total Assets

1,68,80,000 5,92,53,000

97,40,000 4,85,16,000

1,76,00,000 5,27,79,000

LIABILITIES
Capital
Ankit Nag Net Profit / Net Loss 2,00,00,000 (1,35,82,333) 64,17,667 64,17,667 (35,79,000) 28,38,667 28,38,667 14,21,000 42,59,667

Dakshesh Rawat Net Profit / Net Loss

2,00,00,000 (1,35,82,333)

64,17,667 64,17,667 (35,79,000) 28,38,667

28,38,667 14,21,000 42,59,667

Rohit Gujral Collections Ltd.

3,50,00,000

2,14,17,666

1,78,38,666

Net Profit / Net Loss

(1,35,82,334)

2,14,17,666 (35,79,000)

1,78,38,666

14,21,000

1,92,59,666

Loans and Advances


Bank Loan 2,50,00,000 2,50,00,000 2,50,00,000

Total Liabilities

5,92,53,000

4,85,16,000

5,27,79,000

CONCLUSION
There is a massive need of business education in India thus we took the opportunity to start a MBA institute. It had intake of 100 students in the 1st year and due to our massive promotion techniques it was increased to 200 students & 400 students in 2nd and 3rd Year respectively. Also , the funds were utilized majorly in the equipments purchased. The land and building was taken on lease. Overall, the business feasibility shows that the business is feasible, successful and is profitable from 3rd year. So, overall the business idea has a huge potential.