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Queen’s Land Environmental Controlled Shed

Submitted to;
Sir Javaid Iqbal

Submitted By;
Muhammad Anis 15
Shakir Rashid 27
Hafiz Zahid Mahmood 45

M.Com 4th (MOR)


(2008-2010)

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TO OUR

PARENTS

&

TEACHERS

Our kind Teacher Sir Javeed Iqbal by virtue of who’s Prayers, We


have been able to reach at this position and whose hands always rose
for prayers and wellbeing. We feel proud by having guide ling from
our teacher Sir Javeed Iqbal We cannot forget their cooperation and
sacrifices.

Sir Javaid Iqbal

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We pay our humble gratitude, with humility and


submission, to ALLAH, the Almighty, the Omniscient, the
Omnipotent & the Omnipresent, who bestowed our potential to
accomplish this task. The completion of this issue is, mere, the
blessing of ALLAH and Holy Prophet Hazrat Muhammad (Saw).
We feel honor to express our sincere gratitude to Sir
Javeed Iqbal for this supervision, guidance and encouragement
throughout this project. We always found him very much alive, full
of zeal, vitality and intellectual curiosity. With out him ideas,
remarks and endless interest out and completed and thanks to all
teachers.

Ch:N Contents Page #


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1 Introduction 05

2 Executive Summary 06

3 SWOT Analysis 11

4 Market Analysis 13

5 Technical Analysis 20

6 Personnel Analysis 25

7 Financial Statements 26

8 Financial Ratios 29

9 Assumptions 30

10 Conclusion & Recommendations 31

Chapter

1
Introduction

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Chapter

2
The poultry farm is a project of livestock sector, in
which, the day old chicks (DOCs) are raised on high protein feed
for a period of six weeks. Broiler meat is the cheapest source of
animal protein available in the country. The time required for
rearing broiler birds is lesser than that for large animals. The
consumption of white meat is increasing due to growing health
consciousness in the masses. Broiler farming is a profitable
venture due to continuous increasing demand of the meat in the
market. Annually, seven flocks of birds will be reared on the same
premises of the farm. The broiler birds are sold to traders and the
whole sellers markets in the urban areas. Some times birds can also
be sold directly to the shopkeepers in the urban markets.
.
Broiler meat is the cheapest source of animal protein
available in the country. The time required for raising broiler
birds is lesser than that for big animals. The consumption of
white meat is increasing due to growing health consciousness in the
masses.

According to the Agriculture Statistics of Pakistan


the per capita consumption of poultry meat is increasing at a rate
of 4% per annum.

The existing daily availability of protein quantity per


capita in Pakistan deriving from animal source including beef,
mutton, poultry and fish combined amounts to 11 grams. This is far
less than the recommended daily dietary protein allowance from
animal source of 26 grams according to the World Health
Organization standards. .

Executive Summery
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The proposed project contemplates to set up Queen’s


Land Environmental Controlled Shed at Chak 34BC in Dera Bakkah
Hasilpur Road Bahawalpur. The annual rated capacity is 525,000 Kg
of meat. The proposed project has latest imported machinery from
Spain but it is directly purchased from supplier through Lahore and
locally made building structure.

LOCATION:
The proposed project contemplates to set up Queen’s
Land Environmental Controlled Shed at Chak 34BC in Dera Bakkah
Hasilpur Road Bahawalpur. The target market is Bahawalpur City.
The area of the project is 1Acre.

The proposed project site enjoys the benefits of;


1) Easy availability of raw material
2) Quick access to main road and Railway station.
3) Sources of power, water, fuel etc.
4) Availability of Transport and modern Communication systems.
5) Availability of Skilled and Un-Skilled labor.
6) Free from environmental hazards like water logging and salinity.

PRODUCT MIX:
The proposed project will generate revenues from sale of
chicken.

INSTALLED CAPACITY OF PROJECT:


Installed capacity of the project at 100% is 210,000 birds or
525,000 Kg of meat annually.

ESTIMATED PRODUCTION:

Chicks 2011 2012 2013


Total Production 100%
Capacity Production 90% 95% 100%
Total Production 4 4 5
Capacity '000 525 73 99 25

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ESTIMATED COST OF PROJECT:


Project Cost
Description Amount '000’
Land & Land
Development 1,920

Building & Civil Works 8,783

Machinery 2,622

Furniture & Fixture 159

Pre-Production Expenses 185


Interest During
Construction 1,246

Cost of Project 14,915

Contingencies 10% Project Cost 1,492

Total Fixed Cost 16,407


Initial Net Working
Capital 8,190

Total Cost of Project 24,596

MEANS OF FINANCE:
Means of Finance
Amount '000'
Debt 60%
Allied Bank Loan 14,758
Total Debt 14,758

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Equity 40% 9,839


Total Debt & Equity 24,596

NAME OF SPONSORS:
The sponsors of the project are professionally qualified
and have valuable and extensive experience of business management
in poultry field namely;

Muhammad Anis resident of Bahawalpur


Contribute 40% towards Total Equity

Shakir Rashid resident of Bahawalpur


Contribute 30% towards Total Equity

Hafiz Zahid Mahmood resident of Ahmad Pur


East
Contribute 30% towards Total Equity

The overall management and control of the firm will be


actively managed by its partners who will actively participate in
management decisions and control the affairs of the firm.

SPONSORS STAKE:
Names of Sponsors % of Equity Contribute Amount '000'
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Muhammad Anis 40% 3,935


Shakir Rashid 30% 2,952
Hafiz Zahid Mahmood 30% 2,952
Total Equity 100% 9,839

NAME OF CIVIL CONTRACTOR:


Apna Home Designer;
Muhammad Yaseen Afzal;
Contact # 0301-3334445
One Unit Chowk Bahawalpur.

NAME OF MACHINERY SUPPLIER:


Ahmad W. Naseer,
Biovet Pvt Limited,
97-A, Jail Road, Lahore
Office # 042-7534508
Mobile +92-300-8444202
Web: www.biovet.com.pk
Email: ahmad.waqas@biovet.com.pk

IMPLEMENTATION SCHEDULE:
Implementation Schedule
S.# Activities Month Year
1 Acquiring of Land & leveling Start 1st April 2010
Complete 15th April 2010
2 Engineering studies and designing of Start 16th April 2010
civil work Complete 30th April 2010
4 Order for machinery 1st Aug 2010
5 Construction of building and civil work Start 1st May 2010
Complete 31st Aug 2010
6 Arrival of machinery at site 1st Sep 2010
7 Erection and installation of machinery Start 5th Sep 2010
Complete 20th Sep 2010
8 Order for raw materials 15th Sep 2010
9 Trial run Start 21st Sep 2010
Complete 30th Sep 2010
10 Start of commercial production 1st Oct 2010

OPPORTUNITY RATIONALE:

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Broiler meat is the cheapest source of animal protein


available in the country. The time required for raising broiler
birds is lesser than that for big animals. The consumption of
white meat is increasing due to growing health consciousness in the
masses.

According to the Agriculture Statistics of Pakistan


the per capita consumption of poultry meat is increasing at a rate
of 4% per annum.

The existing daily availability of protein quantity per


capita in Pakistan deriving from animal source including beef,
mutton, poultry and fish combined amounts to 11 grams. This is far
less than the recommended daily dietary protein allowance from
animal source of 26 grams according to the World Health
Organization standards

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Chapter

3
SWOT Analysis

Environmental Controlled Shed


STRENGTHS:
Environmental Controlled Shed has various strengths
and they are as follows:

• Growth in small business


• Require government incentive
• Government role and support
• Develop training program for Poultry Farmers
• Meet large demand of meat per year at cheaper prices
• cooperative marketing system in the developing process
• Less Chances of Diseases
• Maintain temperature less than 40*C

WEAKNESS:
The weaknesses of Environmental Controlled Shed are
as follows:

• Adoption of new vaccines


• High cost of raw material
• Not availability of space
• Diseases
• Unhygienic condition
• Processing plant
• Poor management
• Lack of trained worker
• lack of access to inputs and credits

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OPPORTUNITIES:
Environmental Controlled Shed has various
opportunities and they are as follows:

• Scope for frozen company


• Economic beneficial
• Advantage for small business person
• Scope for restaurant
• Continuous increase in demand of meat in market
• Sales price are reasonable & internal rate of return is also low
• Production on large scale can maximize profit

THREATS:
The threats of Environmental Controlled Shed are as
follows:

• Effect of change in the government regulation.


• Bird Flu
• Heavy duty charge on incubator
• Present crisis
• Continuously too much variation in sales prices
• Energy crises
• Rapid increase in chicks prices

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Chapter

4
Market Analysis

The marketing of chickens follows the traditional


channels of distribution. Generally, broilers are distributed in the
market through middlemen and Wholesalers. The role of Arti is to
identify a farm and negotiate the price. In some Cases, the
middleman provides Day Old Chicks and other farm inputs (feed,
etc.) to the broiler farmers and then agrees to buy back the mature
birds from them. Birds are transported to the urban market and are
sold to retailers or market-street Poultry shops. Birds are sold on
live-weight basis. The time spent in getting broilers from the farm to
the retail shop is brief. Although collection and handling of birds has
improved with the use of loader vehicles, but it is an established fact
that greater the distance between the poultry producer and consumer,
more complicated is the Marketing system including their collection,
handling and transportation to the Consumer or processing plants.
The processing plant produces dressed chicken (Slaughtered and
cleaned). However, a very small amount of dressed chicken is
Available in the local retail market. The integrated processing units
distribute frozen and dressed chicken packed in whole or cut-ups to
the consumer through retail shops under their brand names. The
trick in marketing is quick availability of market information of
chicken supply And demand, which will determine the selling price.
DISTRIBUTION CHANNELS

Type Units 2006-07 2007-08 2008-09


Domestic Poultry Million 74.02 75.11 76.22
No’s
Cocks 8.84 9.08 9.32
Hens 34.84 35.47 36.11
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Chicks 30.34 30.57 30.79


Eggs 3484 3547 3611
Meat 000 Tons 96.54 98.45 100.41
Duck, Drake & Ducking 0.67 0.64 0.61
Million No’s
Eggs 29.85 28.61 27.42
Meat 000 Tons. 0.91 0.87 0.83
Commercial Poultry
Layers. Million No’s 24.82 26.56 28.42
Broilers 370.7 407.77 448.55
Breeding Stock 7.25 7.61 7.99
Day old Chicks 387.2 425.92 468.51
Eggs 6682 7136 7620
Meat 000 Tons 456.95 501.3 550
Total Poultry
Day old chicks. Millions 418 456 499
No’s
Poultry Birds 477 518 562
Eggs 10197 10711 11258
Poultry Meat. 000 Tons 554 601 651
(Economic Survey of Pakistan 2008-2009)

Poultry Sector is one of the vibrant segments of


agriculture industry of Pakistan. This sector generates employment
(direct/indirect) and income for about 1.5 million people. Its
contribution in agriculture growth is 4.81% and in Livestock growth
9.84%. Poultry meat contribution 19% of the total meat production
in the country. The current investment in Poultry Industry is about
Rs. 200.00 billion. Poultry sector has shown a robust growth at the
rate of 8-10 percent annually which reflects its inherent potential.
2006-2007 2007-2008 2008-
2009
BROILER
A Broiler Grant Parent 200,000 175,000 135,000

Punjab 100% 100% 100%


B Broiler Parent Stock 8.0 M 7.5 M 5.5 M
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Punjab 68% 75% 79%


Sindh 2% 2% 3%
N.W.F.P 30% 23% 18%

Baluchistan - - -
C Commercial Broiler 800 M 720 M 550 M
Punjab 75% 75% 75%

Sindh. 20% 20% 20%

N.W.F.P 4% 4% 4%
Baluchistan. 1% 1% 1%
LAYER
D Layer Grant Parent 4,000 - -
Punjab 100% - -

E Layer Breeder New 428,000 225,000 290,000


Molted 250,000 275,000 170,000
Punjab 75% 75% 75%
Sindh 20% 20% 20%
N.W.F.P - - 5%
F Commercial Layer 35.5 M 34.0 M 30.0 M
Punjab 70% 70% 70%
Sindh 25% 25% 25%
N.W.F.P 4% 4% 4%
Baluchistan 1% 1% 1%
FEED
G Feed 5.5 M.T. 5.0 M.T 3.8 M.T
Punjab 82% 82% 82%

Sindh 18% 18% 18%

N.W.F.P - - -
Baluchistan - - -
(Economic Survey of Pakistan 2008-2009)
BROILER:

G.P 200,000 (Including all Lines).


P.S. 6.0 M
Broiler 600 M

LAYER:
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P.S 0.45 M
Commercial 30.00 M

Live Wt.

BROILER:
G.P. 200,000 X 4 = 0.8 M. Kg
P.S. 6.0 X4 = 24.0 M. Kg
Broiler 600 X 1.6 = 960.0M. Kg

LAYER:
P.S. 0.45 X 2 = 0.9 M. Kg
Commercial 30 X 2 = 60.0 M. Kg

Total = 1045.7 M. Kg
Meat 60 % = 627.0 M. Kg
Per Capita = 3.92 Kg
Desi = 0.60 Kg
Total Per Capita = 4.52 Kg
(Economic Survey of Pakistan 2008-2009)

POULTRY GP IN PAKISTAN UPDATES 17-12-2009:


ALNOOR GP PROJECT

AL-NOOR CHICKS (PVT) LTD.


P-485,OPPOSITE NATIONAL SILK MILL 4-km,,Jaranwala Road
Faisalabad
Phone : (92-41) 8555782-87 5LINES FAX;92 41 8710472
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SALES OFFICE;FALT;17-18,KALA KHAN PLAZA


SHAMASABAD MUREE ROAD RAWALPINDI
TEL;92 51 4419050,4453958,4417288 FAX;92 51 4425389
KARACHI;FAX;92 21 4540522,TEL;92 21 4540533
MULTAN;92 61 4549674-4546779
R Y KHAN;92 68 5873422,5873622
CEO CH NIAZ RASOOL
BRPOILER GP SHAVER STARBRO LAYER GP SHAVER
Mr. Niaz Rasool Chaudary
Chairman.

GRAND PARENT POULTRY (PVT) LTD.

2-A, Ahmad Block, New Garden Town, LAHORE 54600


P.O.Box: 157 Lahore
Phone: (92-42) 35835374-35835373, 35837512-14 Fax :( 92-
42)35835371-35839170-35860519
UAN; 111 111 220
big-bird@nexlinx.net.pk
basit@bugbird.lcci.org.pk
www.bigbirdgroup.com
CEO DR MUSTAFA KAMAL, 92 300 8450403
Rawalpindi office; 6-a, commercial satellite town RAWALPINDI
TEL; 92 51 4451740-4843790 FAX; 4841016
DR NAEEM TARIQ, HUBBARD TECHNICAL SERVICES
HOUSE#123 STREET NO-65 F-11/4 ISLAMABAD PAKISTAN
TEL FAX; 92 51 2297478
CELL 92 300 8554682
naeem.tariq@hubbardbreeders.com

FAISAL CHICKS

POSTAL & CONTACT;P-42/1 OPP MUNCIPAL DGREE


COLLEGE JARANWALA ROAD FAISLABAD PAKISTAN
TEL;+92 41 8726639-8727639
fax;+92 41 8546639
E-MAIL;faisalchicks@yahoo.com
chairman CH MUSTAFA
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DIRECTR DR AHMAD MUSTAFA


MARKEETING MANGER;DR AAMER MALIK
G.P LAYER NOVOGEN GROUPE GRIMAUD (SISTER
COMPANY OF HUBBARD)

QUALITY BREEDERS

HEAD OFFICE: HOUSE#28-A, BLOCK-D, SATELLITE TOWN


MAIN 6TH ROAD RAWALPINDI
Tel: 111-96-96-96 fax 4425180
92 51 4457435-39
sarosh_2001@yahoo.com
DIRECTOR DR HASSAN SAROSH AKRAM
BROILER GP ARBOR ACERS

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POULTRY & MARKETING DIVISION:

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Chapter

5
TECHNICAL ANALYSIS

PROCESS FLOW:

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FLOW SYSTEM:
The following practices starting from arrival of the
chicks to

• Thermostatically temperature control: Low temperature will

be controlled with the help of diesel heaters and high temperature

with evaporative cooling system.

• Watering through automatic nipple drinking system.

• Feeding through automatic feeding system.

• Specific vaccination schedule will be adopted for disease

control.

• Prophylactic medication will be provided according to

requirement.

• Sanitation and disinfection program will be strictly followed

during and after the completion of one flock.

• Computerized record will be maintained for feed intake, body

weight, FCR and mortality.

• Marketing of finished (ready) broilers.

TECHNOLOGY INVOLVED:
The Machinery which is used for Queen’s Land

Environmental Control Shed is Foreign Machinery which imports

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form Spain and we directly purchased it from Biovet Pvt Limited

Lahore (Supplier).

LIST OF MACHINERY:

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Machinery and Other Equipment


Description Qty Cost /Item Rs. '000'

Feed Hooper 1 55,000 55

Cooling Pad 4 19,900 80

Electric Moter 1HP 25 5,293 132

Generator 25 KV 1 400,000 400

Transformer 25 KV 1 310,000 310

Winch 5 5,527 28

Cone Fan Exhaust 15 17,000 255

Feed Line 4 85,680 343

Water Line 5 60,235 301

Water Tank 1500 liter 2 9,300 19

Environment Controller 1 203,000 203

Brooder 2 183,587 367

Regulator 3 5,530 17

Penal Board 2 7,080 14

Alarm Box 1 4,850 5

Pressure Machines 2 20,065 40

Main Switch 1 2,610 3


Total Cost of Machinery
& Equipment 2,571

Erection & Installation 2% 51


2,6
Total Machinery & Equipment Required
22

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REQUIREMENT OF RAW MATERIAL:


Raw Material
2011 2012 2013
Rs ''000' Rs ''000' Rs ''000'
Chicks 13,608 16,519 19,996
Feed Bags 23,020 27,944 33,827
Vaccine 162 171 180.04
Total (Rs.) 36,790 44,634 54,003

REQUIREMENT OF UTILITIES:
MANUFACTURING OVER-HEADS

a)
FIXED COSTS (Rs.000)
(Fixed No. of
(KVA) Amount) Months
Power KVA 25 315 per KVA 12 95
Repairs &
Maintenance
on
Construction
Building @ 4% Cost 351
Machinery
@ 5% Installed cost 131
Generator Flock in
(Diesel) Rs. 500,000 per Flock 7 Year 3,500
Miscellaneous 50

Total Fixed
cost 4,127

b)
VARIABLE
COST
No. of
days in
Price/Unit Consumption Units per Day year Total
Off-Peak/Day 6.27 70 315 138
Peak/Day 10.27 18 315 58
Total Variable
Cost 196

MANUFACTURING OVER-
HEADS 2011 2012 2013
90% 95% 100%
Fixed Costs 4,127 4,127 4,127
Variable Costs 177 187 196
Total Costs 4,304 4,314 4,323

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Chapter

6
Personnel Analysis

HUMAN RESOURCE REQUIREMENT:

S.No. Types of Staff Required Salary Per Month Salaries for Year
General
1 Manager 1 10,000 112,000

2 Accountant 1 8,000 96,000

3 Supervisor 1 11,000 132,000

4 Doctor 1 20,000 240,000

5 Workers 6 7,000 504,000

6 Electrician 1 9,000 108,000

7 Cook 1 7,000 84,000

8 Sweeper 2 4,000 96,000


Security
9 Guard 1 6,000 72,000

TOTAL 15 1,440,000

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Chapter

7
Financial Analysis

INCOME STATEMENT:
INCOME STATEMENT Amount '000' (Rs.)
For the Year ended 2011 2012 2013
Operating Efficiency Assumed 90% 95% 100%
59,0 71,6
Sales 63 95 86,789
Cost of good Sold:.
36,7 44,6
Raw Material Consumed 90 34 54,003
1,0 1,1
Labor 68 21 1,177
4,3 4,3
Manufacturing Expense 04 14 4,323
7 7
Depreciation 06 06 706
42,8 50,7
Cost of good Sold 68 75 60,210
16,1 20,9
Gross Profit 94 21 26,579
Operating Expenses:
General and Admin. Exp (Increase 4 4
Annually) 2% 84 94 504
5 7
Selling Expenses 1% 91 17 868
1,0 1,2
Total Operating Expenses 75 11 1,371
15,1 19,7
Operating Profit (EBIT) 20 10 25,207
2,7 9
Other Income 23 71 1,124
Non-Operating Expenses:
Amortization of Pre-Production Exp
(Years) 3 62 62 62
3,3 1,9
Interest Expense 57 94 1,492
14,4 18,6
Earning Before Tax (EBT) 23 25 24,778
2,8 3,7
Provision for Tax 20% 85 25 4,956
11,5 14,9
Net Profit after Interest & Taxes 39 00 19,822
Dividend 0 0 0
11,5 14,9
Retained Earning 39 00 19,822

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BALANCE SHEET:

Balance Sheet
(Rs. in '000')
Construction 2011 2012 2013
ASSETS
Cash 1,442 29,301 43,206 62,448
Marketable Securities 0 0 0 0
Accounts Receivables 188 2,953 3,585 4,339
Raw Material Inventory 5,840 0 0 0
Stores & Spares 1,305 3,679 4,463 5,400
Total Current Assets 8,774 35,934 51,255 72,188

Fixed Assets at cost 16,222 16,222 15,515 14,809


Less: Accumulated
Depreciation 0 706 706 706
Net Fixed Assets 16,222 15,515 14,809 14,103
Preliminary Expenses: 185
Total Assets: 25,180 51,449 66,064 86,291
LIABILITIES & EQUITY
Current Liabilities
Accounts Payable 0 3,679 4,463 5,400
Accrued Expenses 0 2,953 3,585 4,339
Taxes Payable 0 2,885 3,725 4,956
Bank Borrowings 584 3,679 4,463 5,400
Cur. Mat. of L T Debt 0 5,070 4,695 4,193
Total Current Liabilities: 584 18,266 20,932 24,288
Long-term Liabilities
Allied Bank:
Outstanding Loan Principal 14,758 11,806 8,855 5,903

Total Long-term Liab.: 14,758 11,806 8,855 5,903


Total Liabilities 15,342 30,072 29,786 30,192
EQUITY
Paid-up Capital (Sponsors) 9,839 9,839 9,839 9,839
Retained Earning 0 11,539 26,439 46,261
Total Equity: 9,839 21,377 36,277 56,099
Total Liabilities & Equity: 25,180 51,449 66,064 86,291

CASH FLOW STATEMENT:


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ESTIMATED CASH FLOWS


(Rs. in 000)
Construction
Year 2011 2012 2013
SOURCES
15,12 19,71
Operating Profit 0 0 0 25,207
Add Back: Depreciation 0 706 706 706
Amortization of Pre-
Production Expenses 0 62 62 62
Funds from 20,47
Operations 0 15,888 8 25,975
Paid-up Capital (Sponsors) 9,839 0 0 0
Increase in Current Liabilities 0 17,682 2,666 3,357
Increase in Bank Borrowings 584 3,095 784 937
Decrease in Current Assets 0 700 0 0
Outstanding Loan Principal 14,758 0 0 0
23,92
TOTAL SOURCES 25,180 37,364 8 30,269
APPLICATION OF
FUNDS
Investment in Fixed Assets: 16,222 0 0 0
Preliminary Exp 185 62 62 62
Financial Expenses 1,246 2,361 1,869 1,367
Repayment of :
Debt 0 2,952 2,952 2,952
Taxes 0 2,885 3,725 4,956
Increase in current Assets: 7,332 0 1,416 1,692
10,02
TOTAL 24,984 8,258 3 11,027

Chapter

8
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Financial Ratios:

FINANCIAL RATIOS:

Financial Ratios
2011 2012 2013

Gross Margin 27.4% 29.2% 30.6%

Operating Margin 25.6% 27.5% 29.0%

Net Margin 19.5% 20.8% 22.8%

Current Ratio 1.97 2.45 2.97

Cash Ratio 1.60 2.06 2.57

Debt/Equity Ratio 36% 20% 10%

IRR & PAY BACK PERIOD:

IRR 39%

Pay Back Period 2 Years Approximately

Chapter

9
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Assumptions

Some of the assumptions were underlying during the


preparation of Financial Statements are as below;
• Sale price of chicks increase 15% yearly
• Purchase price of chicks Increase 15% yearly
• Purchase price of feed bags increase 15% yearly
• Account Receivable annually 5% of sales
• Accrued expenses annually 5% of sales
• Account payable annually 10% of material consumed
• Stores & Spares 10% of material consumed
• Initial net working capital is for 1 Flock
• Flocks per year 7
• Legal & Brokerage 4% on cost of land
• Stamp duty 2% on cost
• Registration cost of land 1%
• Transfer cost of land 1%
• Land is 1 Acre
• Cost of land per acre Rs. 1,500,000
• Annually tax rate 20%
• Depreciation rate of Machinery, Building and Furniture are
15%, 5% and 3% respectively
• Pre-Production expenses are amortized in 3 years
• Increase in wages 5% yearly
• General & Administrative expenses increase 2% annually
• Operating efficiency assumed in year 1,2 and 3 are 90%, 95%
and 100% respectively
• Equity portion 40%
• Debt portion 60%

Chapter
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10
Conclusion & Recommendations

CONCLUSION:
The poultry farm is a project of livestock sector, in
which, the day old chicks (DOCs) are raised on high protein feed
for a period of six weeks. Broiler meat is the cheapest source of
animal protein available in the country. The time required for
rearing broiler birds is lesser than that for large animals. The
consumption of white meat is increasing due to growing health
consciousness in the masses. Broiler farming is a profitable
venture due to continuous increasing demand of the meat in the
market. Annually, seven flocks of birds will be reared on the same
premises of the farm. The broiler birds are sold to traders and the
whole sellers markets in the urban areas. Some times birds can also
be sold directly to the shopkeepers

in the urban markets.


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COMPERATIVE EFFECIENCY OF
ENVIRONMENTAL CONTROL (ECH) AND
CONVENTIONAL OPEN-SIDE HOUSE:
The modern trend of environment control houses (ECH)
in poultry production has brought a great revolution in poultry
industry of Pakistan in the recent years. This has solved a great
hurdle of heat stress in the way economical commercial poultry
production. The ECH with evaporative cooling system, providing
tunnel ventilation, giving the wind chill effect has markedly
improved the broiler production system. The technology of ECH is
rapidly becoming popular among broiler producers due to its
following significant advantages;
• The ECH brings down the temperature by 10 to 15C as
compared to the conventional open-sided houses (COH) and
makes it comfortable like colder regions.
• ECH maintains the uniform temperature round the clock
providing very conducive environment to the broilers avoiding
fluctuation in the day and night temperature.
• Due to severe heat stress during 4 long summer months the broiler
production is stopped in COH, resultantly only 4-5 flocks are possible
in such houses in a year. However, in ECH 7 flocks are marketed
without any break.
• ECH being complete closed system has minimized the
incidence of diseases, cutting down the cost of vaccine and
medication i.e.Rs.2/bird against Rs.5/bird in COH.
• Mortality in ECH has been decreased to 2%-3% as compared to
10% in COH.
• Installation of highly mechanized automatic feeding and nipple
drinking system in ECH has provided the solution of manual and poor
management practices. One houseman at daytime and one at night
time are sufficient to look after a flock of 35,000 birds. In COH
nearly 6-8 housemen are required to manage such a flock.
• Equal distribution of feed and water to broilers through automatic
system in ECH has markedly improved the uniformity up to 95% as
compared to 75% in COH.
• In ECH a broiler flock is ready for market in 35 days as compared
to 42 days in COH.
• An individual broiler in COH usually consumes 3 to 3.3 kg feed to
gain 1.5 kg weight reflecting its Feed Conversion Ratio (FCR) =

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2 to 2.2. Whereas this figure of FCR is improved to 1.8 in ECH.


VISIT HIGHLIGHTS:
We have visited Sunshine Protein Shed Farm located in
Chak 34BC in Dera Bakkah Hasilpur Road Bahawalpur. Some of
the visit highlights are given below;

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GOVERNMENT POLICIES:
In Pakistan the concept of commercial poultry rearing,
hatching and feed milling was not known few decades ago. The back
yard poultry was the only source of enriched animal protein. In back
yard rearing we didn't have the real growing or laying birds.' In fact
the birds were not kept for any kind of financial gains; rather to rear
poultry was like rearing kids. I mean they were only reared and
cared either they are profitable or not. It was the start of 6th decade
of the 20th century, when the Government of Pakistan felt the need
of intensive Poultry rearing program by keeping in view the
increased demand of white meat due to heavy growth in our
'population. So, it was in 1962 when Commercial Poultry was
initially introduced in Pakistan by M/S Shaver's of Canada with the
help of PIA and that led to the formation of the PIA Shaver with' the
poultry sector.' In its embryonic stages became a blue eyed to the
government officials and the rearing or any kind of business relating
poultry was announced to be Tax exempted. The first hatchery was
then established in Karachi. Our government supported poultry
industry in all aspects that helped the industry to develop rapidly. As
the Poultry was new in the region, the disease problems were
obviously expected also, therefore in early 90's' Gumboro hits
Broiler & Layer flocks and parent stock suffered heavy mortality
resulting in great economical losses. After that' incidence the efforts
were made to get things on track by addressing Vaccination and
Bio-Security issues very religiously. The shock was yet fresh in the
mind of the farmers and Poultry entrepreneurs when in mid 90's the
new disease caught the Parent Flocks in the Northern Areas
(Abbotabad and Mansera), where the mortality rate went up to 80%
and the industry again suffered grave losses .Again in very next year
in 1996 due to increased number of parent stock, the prices of
chicken products fell down even below the' cost of its production
and the farmers again suffered heavy losses. This down fall misery
continued till 1997 and ban on marriage food was imposed which
reduced the consumption of poultry products by 40%. Late 90s led
to the phase of stability in the poultry industry and farmers got good
profit margin. New investors rushed into the poultry farming by
adopting the new techniques of environment control houses and
industry shifted from traditional conventional open houses to Semi
and completely closed automated houses where the intensive rearing
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is done under one roof. In this transformation the industry shared


huge investments from multinationals and the poultry over all
flourished till 2004. In 2004 Avian Influenza hit the South East Asia
and Pakistan Poultry Industry suffered heavily due its rumors.
Imposition of ban on imports of poultry products by Middle East
countries made things more miserable. This scary condition of the
industry is yet prevailing. We experienced hike in the poultry market
for a few months and then a long phase of depression due to selling
our products below the cost of production. The Up's and Down's are
with every industry but poultry industry of Pakistan witness that
quite too often.

PRESENT STATUS OF POULTRY SECTOR 2010:


I. Fixed Investment in poultry sector is over Rs.200 Billions.

II. Presently turnover of Pakistan Poultry Industry is about Rs.300


Billions.

III. There are about 25000 Poultry Farms in the Country.

IV. Poultry sector generates employment and income for about


fifteen hundred thousands people.

V. Poultry sector is one of the most organized branches of the agro


based sector of Pakistan. Its growth rate is 10-12% annually.

VI. At present over 50 Billions' of agriculture produce and Bio


products of Agriculture are being used in poultry feeds.

VII. 40% of the total meat consumption is being procured from


poultry products.

A. we are producing 7830 Million Table eggs.

B. 13,936 Metric Tons chicken meat annually.

VIII. In our Country per capita consumption of meat is only 7 KG


and 60-65 eggs annually.
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A. Whereas developed world is consuming 41 KG meat and over


300 Eggs per capita per year.
B. No of Hatcheries 400
C. No of Feed Mills 150
D. No of People /dependant 1.5 Millions
IX. POPULATION
Broiler Breeder 8.5 Million Birds
Layer Breeder 0.428 Million Birds
Commercial Broiler " 8 .6 x 105 = 900 Million Birds
Layer Birds 29 Million Birds
Feed Consumption 5.51 M.M.T

PROVINCE WISE POULTRY STATISTICS:


1. BROILER
a. Broiler Grand Parent 200,000
b. Broiler Parent Stock 7.0 Millions
Punjab 68%
Sindh 2%
N.W.F.P 30%
Baluchistan
700 Millions
c. Commercial Broiler

Punjab 70%
Sindh 23%
N.W.F.P 5%
Baluchistan 2%
2 .LAYER
d. Layer Grand Parent 4000
Punjab 100%
e. Layer Breeder 450,000
Punjab 67%
Sindh 25%
N.W.F.P 8%
Baluchistan
f. Commercial Layer 32 Millions
Punjab 61%
Sindh 32%
N.W.F.P 5%
Baluchistan 2%
3. FEED
4. Feed 5.5 M.T.
Punjab 82%

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Sindh 18%
N.W.F.P
(Pakistan Poultry Association)

RECOMMENDATIONS:
In Pakistan the concept of commercial poultry rearing,
hatching and feed milling was not known few decades ago. The back
yard poultry was the only source of enriched animal protein. In back
yard rearing we didn’t have the real growing or laying birds. In fact
the birds were not kept for any kind of financial gains; rather to rear
poultry was like rearing kids. They were only reared and cared either
they are profitable or not.
It was the start of 6th decade of the 20th century, when
the Government of Pakistan felt the need of intensive Poultry rearing
program by keeping in view the increased demand of white meat
due to heavy growth in our population. So, it was in 1962 when
Commercial Poultry was initially introduced in Pakistan by M/S
Shaver’s of Canada with the help of PIA and that led to the
formation of the PIA Shaver with the poultry sector.

We conclude that on the basis of field work and survey


of control shed that the meat is necessary product so its demand
increases day by day. There is no chance to decrease the demand of
meat. Availability of raw material is very easy. So, conclusion is that
the control shed is a profit motive business because no chance of
decrease of demand.
Our recommendation to new investors is that they must
invest in control shed because from the last 5-6 year there is a great
change or entrance of new control shed in Pakistan. So, they step
forward to come and invest or to start this business, and also
contribute in the economic as well as social growth of Pakistan.

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