Small and Medium Enterprises Development Authority Ministry of Industries & Production Government of Pakistan www.smeda.org.pk HEAD OFFICE 4th Floor, Building No. 3, Aiwan e Iqbal, Egerton Road, Lahore Tel 92 42 111 111 456, Fax 92 42 36304926-7 helpdesk@smeda.org.pk
Pre-Feasibility Study Dairy Farming September 2013 2 1. DISCLAIMER This information memorandum is to introduce the subject matter and provide a general idea and information on the said matter. Although, the material included in this document is based on data/information gathered from various reliable sources; however, it is based upon certain assumptions which may differ from case to case. The information has been provided on as is where is basis without any warranties or assertions as to the correctness or soundness thereof. 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, its employees or agents do not assume any liability for any financial or other loss resulting from this memorandum in consequence of undertaking this activity. The contained information does not preclude any further professional advice. The prospective user of this memorandum is encouraged to carry out additional diligence and gather any information which is necessary for making an informed decision, including taking professional advice from a qualified consultant/technical expert before taking any decision to act upon the information. For more information on services offered by SMEDA, please contact our website: www.smeda.org.pk
Pre-Feasibility Study Dairy Farming September 2013 3 2. PURPOSE OF THE DOCUMENT The objective of the pre-feasibility study is primarily to facilitate potential entrepreneurs in project identification for investment. The project pre-feasibility may form the basis of an important investment decision and in order to serve this objective, the document/study covers various aspects of project concept development, start-up, and production, marketing, finance and business management. The purpose of this document is to facilitate potential investors in Dairy Farm by providing them with a general understanding of the business with the intention of supporting potential investors in crucial investment decisions. The need to come up with pre-feasibility reports for undocumented or minimally documented sectors attains greater imminence as the research that precedes such reports reveal certain thumb rules; best practices developed by existing enterprises by trial and error, and certain industrial norms that become a guiding source regarding various aspects of business set-up and its successful management. Apart from carefully studying the whole document one must consider critical aspects provided later on, which form basis of any Investment Decision. 3. INTRODUCTION TO SMEDA The Small and Medium Enterprises Development Authority (SMEDA) was established in October 1998 with an objective to provide fresh impetus to the economy through development of Small and Medium Enterprises (SMEs). With a mission "to assist in employment generation and value addition to the national income, through development of the SME sector, by helping increase the number, scale and competitiveness of SMEs" , SMEDA has carried out sectoral research to identify policy, access to finance, business development services, strategic initiatives and institutional collaboration and networking initiatives. Preparation and dissemination of prefeasibility studies in key areas of investment has been a successful hallmark of SME facilitation by SMEDA Concurrent to the prefeasibility studies, a broad spectrum of business development services is also offered to the SMEs by SMEDA. These services include identification of experts and consultants and delivery of need based capacity building programs of different types in addition to business guidance through help desk services. 4. INTRODUCTION TO SCHEME Prime Ministers Small Business Loans Scheme, for young entrepreneurs, with an allocated budget of Rs. 5.0 Billion for the year 2013-14, is designed to provide subsidised financing at 8% mark-up per annum for one hundred thousand (100,000) Pre-Feasibility Study Dairy Farming September 2013 4 beneficiaries, through designated financial institutions, initially through National Bank of Pakistan (NBP) and First Women Bank Ltd. (FWBL). Small business loans with tenure upto 7 years, and a debt: equity of 90 : 10 will be disbursed to SME beneficiaries across Pakistan, covering; Punjab, Sindh, Khyber Pakhtunkhwah, Balochistan, Gilgit Baltistan, Azad Jammu & Kashmir and Federally Administered Tribal Areas (FATA).
5. EXECUTIVE SUMMARY Dairy Farm is a project to attract small investors, in which, the 12 cows and buffalos are raised on specific feed to gain high milk yield. Dairy farming is highly complex as it includes breeding, management, feeding, housing, disease control and hygienic production of milk on farm. A dairy farm with a population of 12 cattle (6 cows and 6 buffalo) need a total investment estimated at Rs. 2.05 million out of which the capital cost of the project is Rs.1.95 million for animal purchase and the building construction and the rest is used to meet the working capital requirement. The project is expected to achieve the revenue of Rs. 2.00 million in the first year with projected IRR and Payback of this project are 31% and 3.87 years respectively. The farm will provide employment opportunity to 01 individual other than the owner manager. Legal status of the projected id proposed as a sole proprietorship. 6. BRIEF DESCRIPTION OF PROJECT & PRODUCT Dairy farming is one of the fast growing businesses in the country which not only meet the increasing demand of milk in the region but also contribute its part in export and national income. Keeping in view the significance of dairy farming, business nature and industry competition, it is recommended to focus on management and operational aspects of the farm, quality of herd mix, vaccination of the animals, feeding standards, and housing system to make the business profitable. The dairy farm is proposed to be established on purchased farm land and constructed structure having total area of 3,485 sqft. The proposed model is about 12 animals (6 cows and 6 buffaloes) to achieve milk production of 33,288 liters by the end of first year. Milk production will be sold to the domestic and bulk buyers at the rate of Rs.60 per liter with an annual price increase of 10%. Pre-Feasibility Study Dairy Farming September 2013 5 7. CRITICAL FACTORS 1. Background knowledge and related experience of the entrepreneur in dairy farm operations. 2. Selection of cows and buffalos with established minimum daily production of 10 liters or above buffalo and 12 liters or above for cows, certified with no diseases with 2 nd or 3 rd lactation 3. Application of good husbandry practices as below a. Housing and shelter b. The housing style should be tie stall system c. Regular vaccine of HS and FMD is necessary d. Feeding should be done thrice and 10% crude protein (CP) and 1500 kcal energy e. Milk should be refrigerated at 4 O c and transport at 11 O c temperatures 8. INSTALLED & OPERATIONAL CAPACITIES Production capacity is based on project size. The feasibility study suggests an initial herd size of twelve (12) animals, which is economical to justify the overhead cost. Initially, herd mix of 50% cows and 50% buffaloes is recommended to get the maximum milk production round the year. The dairy farm will have the capacity to produce 33,288 liters of milk per annum. The buffalo breeds found in Pakistan are Nili-Ravi and Kundi. The cattle breeds are Sahiwal, Red Sindhi, Tharparkar and Cholistani. The crossbred cattle may be considered also as in Pakistan, crossbreeding is recommended for non-descript cattle breeds with semen of local high producing breeds like Sahiwal, Cholistani, Red Sindhi etc. or exotic breeds like Holstein Friesien, Jersey etc. These crossbred animals have more milk production, less calving interval and early age of maturity as compared to local animals with low genetic potential. 9. GEOGRAPHICAL POTENTIAL FOR INVESTMENT The development of urban and peri-urban commercial dairy farms is something new in livestock production. Metropolitan cities like Lahore, Karachi, Multan, Rawalpindi, Peshawar, Noshehra, Hyderabad, Sukkur Gilgit and Quetta etc are the major market of milk. Hence, dairy farm established in peri-urban areas of these cities fulfils the daily need of these cities. 10. POTENTIAL TARGET MARKETS Domestic consumers, milk processors, dairy companies, milk collection companies and contractors are the major clients of a dairy farm.
Pre-Feasibility Study Dairy Farming September 2013 6 11. PROJECT COST SUMMARY A detailed financial model has been developed to analyze the commercial viability of Dairy Farm Project under the Prime Ministers Small Business Loan Scheme. Various cost and revenue related assumptions along with results of the analysis are outlined in this section. The projected Income Statement, Cash Flow Statement and Balance Sheet are attached as annexure. 11.1. Project Economics All the figures in this financial model have been calculated for 12 Dairy animals consisting of cows and buffalos in equal proportion. The following table shows internal rates of return and payback period. Table 1: Project Economics Description Details Internal Rate of Return (IRR) 31% Payback Period (Year) 3.87 Returns on the scheme and its profitability are highly dependent on the efficiency of above mentioned critical factors. In case dairy farm project is not able to attain target milk production and implement effective husbandry practices, it will not be able to cover the potential market and recover payments; hence cost of operating the business will increase. Similarly, the project using good quality and prescribed inputs will essential for this venture. 11.2. Project Financing Following table provides details of the equity required and variables related to bank financing; Table 2: Project Financing
Description Details (Rs.) Total Equity (10%) 205,699 Bank Loan (90%) 1,851,265 Markup to the Borrower (%age/annum) 8% Tenure of the Loan (Years) 7 Pre-Feasibility Study Dairy Farming September 2013 7 11.3. Project Cost Following requirements have been identified for operations of the proposed business. Table 3: Capital Investment for the Project Capital Investment Amount (Rs.) Land 79,752 Building/Infrastructure 210,000 Cows and Buffalos 1,500,000 Machinery & Equipment 66,300 Pre-Operating Costs 100,909 Total Capital Costs 1,956,961 Cash in Hand 100,000 Total Project Cost 2,056,961 11.4. Space Requirement The area has been calculated on the basis of space requirement for shed area, open paddock, servant rooms and stores as in conventional open housing system. Following table shows calculations for project space requirement; Table 4: Space Requirement Sr. No Description Area sq.ft 1 Shed for cows 600 2 Open Paddock for Cows 600 3 Shed for Buffalos 600 4 Open Paddock for Buffalos 600 5 Stores for fodder, concentrate & machine room 150 6 Utensils & milk storage 150 7 Servant Room, Wash room 90 8 Silage Bunker 384 9 Open Space 311 Total 3,485
Pre-Feasibility Study Dairy Farming September 2013 8 Total investment in building and infrastructure is calculated to be approximately Rs. 0.21 million. 11.5. Machinery and Equipment Following table provides list of machinery and equipment required for the proposed dairy farm; Table 5: List of Machinery and Equipment Sr. No Description Unit Rate (Rs.) Qty Cost (Rs.) 1 Calf feeder 1,200 3 3,600 2 Teat Dip Cup 350 2 700 3 Maize Cutter 20,000 1 20,000 4 Water Pump 20,000 1 20,000 5 Freezer 22,000 1 22,000
Total
66,300
In addition to above few other equipment are required, such as fodder cutter, water pump and some buckets etc.
11.6. Raw Material Requirements
Following tables show raw material requirement to run the proposed dairy farm;
Pre-Feasibility Study Dairy Farming September 2013 9 Table 8: Feeding Requirement of Calves Description Kgs/animal/day Rs./kg Amount (Rs.) Buffalo Calf (younger than one year) Silage 6.6 6.00 39.4 Concentrate 2.2 35.00 120.0 Total Fodder 159.4 Cow Calf (younger than one year) Silage 2.6 6.00 15.8 Concentrate 0.9 35.00 120.0 Total Fodder 135.8
11.7. Human Resource Requirement One milk man will be required for milking and care of animals, whereas owner manager will look after the overall business operations. 11.8. Revenue Generation
Table 9: Revenue Generation Description Units Annual Production Rate (Rs./Unit) Annual Revenue (Rs.) Milk Sales Liters 33,288 60 1,997,280 Pre-Feasibility Study Dairy Farming September 2013 10 12. CONTACTS Table 10: Suppliers List
Feed Suppliers AI/ Semen Suppliers Hi-Tech Feeds,1-A, Shadman Chowk Jail Road, Lahore Phone : +92-42-37564503 Fax : +92-42-37564508 Consultant: Dr. Athar (0345-8444511) Al - Haiwan Sires, 5-Km, Pakpattan Road, Sahiwal, Tel. 040-4501271-72 Consultant: Dr. Farooq Cell: 03218695054 Punjnad Feeds Dr. Musaddiq Asif 0322 2668844 Altaf & Co. , Altaf & Co Plaza,16/1,Out Fall Road, Lahore, Tel: 042-35763411-4, www.altafandco.com Doctors Dairy Feeds 203/7, UC-3, Cattle colony, Bin Qasim, Karachi. Phone: +92-21-5081923-27 Hamza Dairy Mart Maj.Dr. Muhammad Ramzan 40,first floor,sadiq plaza,the mall Lahore, 0320-4011220 Alhalal Wanda Al-Halal Livestock Concern Company Super High Way Jahania Tel. 065-2002373, 0300 6881293 Ghazi Brothers B-35 KDA Scheme no 1, Mian Muhammad Shah Road, Karachi. Phone: 021-4543579, Fax: 021-4543763 Anmol Wanda Tel. 0442-661252, 04934427066, 057- 2213422
Pre-Feasibility Study Dairy Farming September 2013 11 13. ANNEXURE 13.1. Income Statement
Income Statement Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10 Revenue fromsale of milk 1,997,280 2,197,008 2,416,709 2,658,380 2,436,848 2,680,533 2,358,869 1,946,067 2,140,674 2,354,741 Other Income - - 72,600 159,720 73,205 161,051 248,019 58,462 128,615 212,215 Total 1,997,280 2,197,008 2,489,309 2,818,100 2,510,053 2,841,584 2,606,887 2,004,528 2,269,289 2,566,956 Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10 Cost of sales Cost of goods sold 1 1,394,373 1,394,373 1,394,373 1,394,373 1,161,978 1,161,978 929,582 697,187 697,187 697,187 Medicine, Vaccination & Insemination Charges 30,600 33,660 37,026 40,729 37,335 41,068 36,140 29,815 32,797 36,077 Operating costs 3 (direct electricity & fuel charges) 120,000 132,000 145,200 159,720 175,692 193,261 212,587 233,846 257,231 282,954 Total cost of sales 1,544,973 1,560,033 1,576,599 1,594,822 1,375,004 1,396,307 1,178,309 960,848 987,214 1,016,217 Gross Profit 452,307 636,975 912,710 1,223,278 1,135,049 1,445,277 1,428,578 1,043,680 1,282,075 1,550,739 General administration & selling expenses Administration expense 240,000 263,367 289,008 317,147 348,025 381,909 209,546 229,948 252,336 276,903 Depreciation expense 6,630 6,630 6,630 6,630 6,118 6,630 6,630 6,630 6,630 6,630 Amortization of pre-operating costs 10,091 10,091 10,091 10,091 10,091 10,091 10,091 10,091 10,091 10,091 Subtotal 256,721 280,088 305,729 333,868 364,233 398,630 226,267 246,669 269,057 293,624 Operating Income 195,586 356,887 606,980 889,410 770,816 1,046,647 1,202,311 797,012 1,013,018 1,257,115 Earnings Before Interest & Taxes 195,586 356,887 606,980 889,410 770,816 1,046,647 1,202,311 797,012 1,013,018 1,257,115 Interest on short termdebt 1,533 2,095 562 - - - - - - - Interest expense on long termdebt (Debt facility : Bank 1) 142,025 125,049 106,674 86,784 65,255 41,951 16,726 - - - Interest expense on long termdebt (Debt facility : Bank 2) - - - - - - - - - - Subtotal 143,558 127,144 107,236 86,784 65,255 41,951 16,726 - - - Earnings Before Tax 52,028 229,743 499,744 802,626 705,561 1,004,697 1,185,586 797,012 1,013,018 1,257,115 Taxable earnings for the year 52,028 229,743 499,744 802,626 705,561 1,004,697 1,185,586 797,012 1,013,018 1,257,115 Tax - 11,487 49,974 140,460 105,834 210,986 248,973 119,552 212,734 263,994 NET PROFIT/(LOSS) AFTER TAX 52,028 218,256 449,770 662,167 599,727 793,710 936,613 677,460 800,284 993,121 Balance brought forward 52,028 270,285 720,055 691,111 1,290,837 1,042,274 989,443 833,452 816,868 Total profit available for appropriation 52,028 270,285 720,055 1,382,221 1,290,837 2,084,548 1,978,887 1,666,903 1,633,736 1,809,989 Dividend 50% - - - 691,111 - 1,042,274 989,443 833,452 816,868 904,994 Balance carried forward 52,028 270,285 720,055 691,111 1,290,837 1,042,274 989,443 833,452 816,868 904,994 Pre-Feasibility Study Dairy Farming September 2013 12 13.2. Balance Sheet
Balance Sheet Year 0 Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10 Current assets Cash & Bank 100,000 - - 261,543 128,603 567,666 240,799 122,427 102,708 315,579 684,420 Total Current Assets 100,000 - - 261,543 128,603 567,666 240,799 122,427 102,708 315,579 684,420 Fixed assets Land 79,752 79,752 79,752 79,752 79,752 79,752 79,752 79,752 79,752 79,752 79,752 Building/Infrastructure 210,000 210,000 210,000 210,000 249,930 249,930 249,930 249,930 249,930 249,930 249,930 Animals 1,500,000 1,500,000 1,500,000 1,500,000 1,500,000 1,500,000 1,500,000 1,500,000 1,500,000 1,500,000 1,500,000 Revaluation Surplus/ (loss) - - (250,000) (250,000) (500,000) (750,000) (750,000) (750,000) (750,000) - Net value of animals 1,500,000 1,500,000 1,500,000 1,250,000 1,250,000 1,000,000 750,000 750,000 750,000 750,000 1,500,000 Machinery & equipment 66,300 59,670 53,040 46,410 39,268 33,150 26,520 19,890 13,260 6,630 - Total Fixed Assets 1,856,052 1,849,422 1,842,792 1,586,162 1,618,950 1,362,832 1,106,202 1,099,572 1,092,942 1,086,312 1,829,682 Intangible assets Pre-operation costs 100,909 90,818 80,727 70,636 60,545 50,454 40,364 30,273 20,182 10,091 - Total Intangible Assets 100,909 90,818 80,727 70,636 60,545 50,454 40,364 30,273 20,182 10,091 - TOTAL ASSETS 2,056,961 1,940,240 1,923,519 1,918,342 1,808,098 1,980,952 1,387,365 1,252,272 1,215,832 1,411,982 2,514,102 Current liabilities Short termdebt - 37,187 13,635 - - - - - - - - Total Current Liabilities - 37,187 13,635 - - - - - - - - Other liabilities Deferred tax - 11,487 61,462 201,921 307,755 518,742 767,715 887,266 1,100,000 1,363,994 Long termdebt (Debt facility : Bank 1) 1,851,265 1,645,328 1,422,416 1,181,129 919,952 637,246 331,236 - - - - Long termdebt (Debt facility : Bank 2) - - - - - - - - - - - Total Long TermLiabilities 1,851,265 1,645,328 1,433,904 1,242,591 1,121,874 945,001 849,977 767,715 887,266 1,100,000 1,363,994 Shareholders' equity Paid-up capital 205,696 205,696 205,696 205,696 245,114 245,114 245,114 245,114 245,114 245,114 245,114 Gain/ (Loss) on revaluation of animals - - (250,000) (250,000) (500,000) (750,000) (750,000) (750,000) (750,000) - Retained earnings 52,028 270,285 720,055 691,111 1,290,837 1,042,274 989,443 833,452 816,868 904,994 Total Equity 205,696 257,724 475,981 675,751 686,224 1,035,951 537,387 484,557 328,565 311,982 1,150,108 TOTAL CAPITAL AND LIABILITIES 2,056,961 1,940,240 1,923,519 1,918,342 1,808,098 1,980,952 1,387,365 1,252,272 1,215,832 1,411,982 2,514,102 Liabilities & Shareholders' Equity Assets Pre-Feasibility Study Dairy Farming September 2013 13
13.3. Statement of Cash Flow
Cash FlowStatement Year 0 Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10 Operating activities Net profit 52,028 218,256 449,770 662,167 599,727 793,710 936,613 677,460 800,284 993,121 Add: depreciation expense 6,630 6,630 6,630 6,630 6,118 6,630 6,630 6,630 6,630 6,630 amortization of pre-operating costs 10,091 10,091 10,091 10,091 10,091 10,091 10,091 10,091 10,091 10,091 Deferred income tax - 11,487 49,974 140,460 105,834 210,986 248,973 119,552 212,734 263,994 Cash provided by operations - 68,749 246,464 516,465 819,347 721,769 1,021,417 1,202,307 813,733 1,029,739 1,273,836 Financing activities Debt facility : Bank 1 - principal repayment (205,936) (222,912) (241,287) (261,177) (282,706) (306,010) (331,236) - - - Short termdebt principal repayment - (37,187) (13,635) - - - - - - - Additions to Debt facility : Bank 1 1,851,265 - - - - - - - - - - Issuance of shares 205,696 - - - 39,418 - - - - - - Purchase of (treasury) shares Cash provided by / (used for) financing activities 2,056,961 (205,936) (260,099) (254,922) (221,759) (282,706) (306,010) (331,236) - - - Investing activities Capital expenditure (1,956,961) - - - (39,418) - - - - - - Acquisitions Cash (used for) / provided by investing activities (1,956,961) - - - (39,418) - - - - - - NET CASH 100,000 (137,187) (13,635) 261,543 558,170 439,063 715,407 871,071 813,733 1,029,739 1,273,836 Cash balance brought forward 100,000 - - 261,543 128,603 567,666 240,799 122,427 102,708 315,579 Cash available for appropriation 100,000 (37,187) (13,635) 261,543 819,713 567,666 1,283,073 1,111,870 936,160 1,132,447 1,589,415 Dividend - - - 691,111 - 1,042,274 989,443 833,452 816,868 904,994 Cash balance 100,000 (37,187) (13,635) 261,543 128,603 567,666 240,799 122,427 102,708 315,579 684,420 Cash carried forward 100,000 - - 261,543 128,603 567,666 240,799 122,427 102,708 315,579 684,420 Pre-Feasibility Study Dairy Farming September 2013 14 13.4. Useful Project Management Tips
Management Knowledge of Business Operation: Background knowledge and related experience of the entrepreneur is a pre-requisite for starting this business Animal Selection: Selection of disease free animals with established standards of daily production Quality Assurance Standards: Whatever means required products quality standards need to be defined, this improves credibility Marketing Ads & Point of Sales Promotion: Business promotion and dissemination through banners and launch events is highly recommended. Product broachers from good quality service providers Price - Bulk Discounts, Cost plus Introductory Discounts: Price should never be allowed to compromise quality. Price during introductory phase may be lower and used as promotional tool. 13.5. Useful Links Prime Ministers Office, www.pmo.gov.pk Government of Pakistan, www.pakistan.gov.pk Ministry of Industries & Production, www.moip.gov.pk Ministry of National Food Security & Research, www.mnfsr.gov.pk Ministry of Education, Training & Standards in Higher Education, www.moptt.gov.pk Government of Punjab, www.punjab.gov.pk Government of Sindh, www.sindh.gov.pk Government of Khyber Pakhtunkhwa, www.khyberpakhtunkhwa.gov.pk Government of Balochistan, www.balochistan.gov.pk Government of Gilgit Baltistan, www.gilgitbaltistan.gov.pk Government of Azad Jamu Kashmir, www.ajk.gov.pk Trade Development Authority of Pakistan (TDAP), www.tdap.gov.pk Security Commission of Pakistan (SECP), www.secp.gov.pk Federation of Pakistan Chambers of Commerce and Industry (FPCCI) www.fpcci.com.pk Pre-Feasibility Study Dairy Farming September 2013 15 Punjab Board of Investment & Trade (PBIT), 23-Aikman Road, GOR-I, Lahore Tel. 042-99205201, www.pbit.gop.pk Sindh Board of Investment (SBI), 1st Floor, Tower B, Finance & Trade Center, Shahra-e-Faisal, Karachi, Tel. 021-99207512-4, www.sbi.gos.pk State Bank of Pakistan (SBP), www.sbp.org.pk National Bank of Pakistan (NBP), www.nbp.com.pk First Women Bank Limited (FWBL), www.fwbl.com.pk Pakistan Agricultural Research Council (PARC), Islamabad, Tel. 051-9203966 www.parc.gov.pk National Agricultural Research Centre (NARC), Islamabad, Tel. 051-9255061, www.parc.gov.pk National Veterinary Laboratory, NARC, Islamabad Tel. 051-9255108 Balochistan Agricultural Research Centre (BARC), Quetta, Tel: 081-9213286-7, www.parc.gov.pk Southern-zone Agricultural Research Centre (SARC), Karachi, Tel: 021- 99261661, 99261561, www.parc.gov.pk Arid Zone Research Institute (AZRI), Bahawalpur, Tel: 0622-876833, www.parc.gov.pk Punjab Livestock & Dairy Development Board (PLDDB), 11- Shami Road, Lahore Cantt. Tel. 042-36676821, www.plddb.pk Faculty of Animal Husbandry, University of Agriculture, Faisalabad, www.uaf.edu.pk Faculty of Veterinary Sciences, University of Agriculture, Faisalabad, www.uaf.edu.pk Faculty of Veterinary and Animal Sciences, Lasbela University of Agriculture, Water & Marine Sciences, Lasbela, www.luawms.edu.pk Faculty of Veterinary Sciences and Animal Husbandry, Sindh Agriculture University, Tondojam, www.sau.edu.pk Gomal College of Veterinary Sciences, Dera Ismail Khan, www.gu.edu.pk KPK Agricultural University, Peshawar, www.aup.edu.pk Pir Mehr Ali Shah Arid Agricultural University, Rawalpindi, www.uaar.edu.pk University College of Veterinary & Animal Sciences, Islamia University Bahawalpur (IUB), www.iub.edu.pk University of Veterinary & Animal Sciences (UVAS), Out Fall Road, Lahore, www.uvas.edu.pk College of Veterinary & Animal Sciences, Jhang, www.uvas.edu.pk/other_campuses Bahauddin Zakariya University (BZU), Multan, www.bzu.edu.pk Nestle Sarsabz Training Institute, Renala Khurd, Okara c/o Nestle Lahore, Tel: 0423-111-637-853 Pre-Feasibility Study Dairy Farming September 2013 16 Animal Husbandry In-Service Training Institute (AHITI), Peshawar, Tel. 091- 2960109, 9210309 Veterinary Research Institute (VRI), Ghazi Road, Lahore Cantt., Tel. 042- 99220140 Al - Haiwan Sires Training Institute, Jogi Chowk, Sahiwal, Tel. 040-4227196, 4221486, 061-6775708 Altaf & Co Livestock Training Institute, Altaf & Co Plaza,16/1,Out Fall Road, Lahore, Tel: 042-35763411-4, www.altafandco.com Solve Agri Pak Ltd, F-6/2, Main Link Road, Model Town, Lahore, Tel: 042- 35969602-3 www.solveagripak.com Dairy & Rural Development Foundation (DRDF), Lahore, www.dairyproject.org.pk Agribusiness Support Fund (ASF), Lahore, www.asf.org.pk Directorate of Livestock Farms, L&DD, Lahore, Tel: 042-99201126-7 Govt. Livestock Farm (GLF) Kallurkot District Bhakkar, Tel: 0453-200928 Livestock Experiment Station (LES), Rakh Ghulaman, District Bhakkar, Tel: 0453-446134 Livestock Experiment Station (LES), Khizarabad, District Sargodha Tel: 048- 3019835 Research & Development Centre, Rakh Khairewala, District Layyah Livestock Experiment Station (LES), Khushab Tel: 0454-215543 Directorate of Small Holder Dairy Development, Gujranwala, Tel: 055-9200410- 11, 9200194 Buffalo Research Institute Bhunikey, District Pattoki, Tel: 049-4421887, 4420072 Livestock Experiment Station (LES), Chak Katora District Bahawalpur, Tel: 062- 2442589 Livestock Experiment Station (LES), Haroonabad, District Bahawalnagar, Tel: 063-2252960 Livestock Experiment Station (LES), Dera Chahl Lahore, L&DD, Punjab, Tel: 042-99239818, 99239819 Directorate of BLPRI, Kherimurat (Attock), L&DD, Punjab, Tel: 057-2213422, 2212130, 2210781 Directorate of Small Ruminants, Multan, L&DD, Punjab, Tel: 061-9201311 Research Centre for Conversation Sahiwal Cattle (RCCSC), Jhang, Tel: 047- 9200329, 9200371, www.rccsc.com.pk Directorate of Livestock Training Centre (LSTC), Bahadurnagar, Okara, Tel: 044- 2661393 Livestock Training Centre (LSTC), Sheikhupura, Tel: 056-9200056 Livestock & Fisheries Department, Government of Sindh, www.sindh.gov.pk Pre-Feasibility Study Dairy Farming September 2013 17 Agriculture & Livestock Department, Government of KPK, www.khyberpakhtunkhwa.gov.pk Cattle Breeding & Dairy Farm, Harichand, District Charsadda, KPK, Tel: 091- 6640187 Buffalo Breeding & Dairy Farm, D.I.Khan, KPK, Tel: 0966-923150 Livestock Research Station, Jaba, Mansehra, (Jaba Sheep and Goat Farm), Tel: 0997-301866 Livestock & Dairy Development, Government of Balochistan, www.balochistan.gov.pk Government Dairy Farm Quetta, Tel: 081-9202564 Bhagnari Cattle Cum Balochi Sheep Farm Usta Muhammad, Dera Allah Yar c/o L&DD Quetta, Tel: 081-9202564 Red Sindhi Cattle Farm Hub, Lasbela c/o L&DD Quetta, Tel: 081-9202564 Govt. Feed Mill Quetta c/o L&DD Quetta, Tel: 081-9202564 District Government Dairy Farm, Pishin c/o L&DD Quetta, Tel: 081-9202564 District Government Dairy Farm, Nushki c/o L&DD Quetta, Tel: 081-9202564 District Government Dairy Farm, Zhob c/o L&DD Quetta, Tel: 081-9202564 District Government Dairy Farm, Loralai c/o L&DD Quetta, Tel: 081-9202564 District Government Dairy Farm, Kohlu c/o L&DD Quetta, Tel: 081-9202564 District Government Dairy Farm, Khuzdar c/o L&DD Quetta, Tel: 081-9202564 District Government Dairy Farm, Kalat c/o L&DD Quetta, Tel: 081-9202564 District Government Dairy Farm, Mastung c/o L&DD Quetta, Tel: 081-9202564 District Government Dairy Farm, Panjgoor c/o L&DD Quetta, Tel: 081-9202564 14. KEY ASSUMPTIONS
Milk Sale Price (cow) Rs. 60 Milk Sale Price (buffalo) Rs. 60 Capacity Utilization 100 Cow: Buffalo Ratio in the Herd 50:50 Purchase Price of a Cow (Rs.) 130,000 Purchase Price of a Buffalo (Rs.) 120,000 Sale Price of a Low Yielder cow (Rs.) 50,000 Sale Price of a Low Yielder buffalo (Rs.) 50,000 Sale Price of one year Male Calf (Rs.) 50,000 Milk Yield per Cow/day (liters) 12 Milk Yield per Buffalo/day (liters) 8