INVESTMENT OPPORTUNITIES IN COLD STORAGE PROJECT REPORT

Swapna Nair Arshamon S.S B.Gajender Preeti Sreyasri Sajith

(09-31-109) (09-31-112) (09-31-124) (09-31-111) (09-31-103) (09-31-110)

Address
Name Mobi cold storage Location and office address of the cold storage unit Address: Ooty road, Mettupalayam (unit-II), Coimbatore, Tamil Nadu 641 301 India

Project background
The unit will be set up under the public private partnership model. The cold storage is aimed at helping farmers store horticulture produce, flowers and grains. These will be shipped to food processing units in Coimbatore which is less than 80 km away. The cost of setting up the cold storage and creating other infrastructure facilities has been estimated at Rs. 10 crore.

Cont««
The Agriculture and Processed Food Products Export Development Authority will bear a major part of the cost. It is expected to create 100 jobs in the unit and around 1,000 farm families will benefit indirectly from it. Agriculture commodities are perishable and farmers cannot store them till they get a fair price. The cold storage unit will have an airconditioned processing centre, a below-zero temperature ware house and a corporate office.

PROJECT BRIEF
All fruits and vegetables require specialized post harvest treatment, appropriate temperature and relative humidity for their storage, which most of the existing cold stores in Tamilnadu lack. In this proposed ³Compartmentalized Cold Storage´ project storage will be done according to the modern technology and on scientific lines. The project will ensure the increased availability and improved quality of high value perishable fruits and vegetables for both export and local sale, which would otherwise perish or deteriorate.

The proposed Cold Storage facility {MOBI COLD STORAGE} has a maximum storage capacity of 53,760 cubic feet. The cold storage is proposed to be located at Coimbatore giving easy access to the customers. The region has access to all public amenities including water electricity and telecommunication facilities.

Vision:
To bring about a paradigm shift in India¶s Cold Chain scenario with unparalleled value proposition on the back of path-breaking innovations.

Mission:
Seamlessly cover Tamilnadu with Electricity-free, Cost Efficient Micro Cold Chain Solution.

FINANCIAL SUMMARY
Sales Rs 9.418 Million per annum  Gross Profit Margin 85%  Net Profit Margin before tax 31%  Internal Rate of Return 32% 

MARKET OPPORTUNITY
There is no considerable cold storage in the area. The goods are not stored at their recommended relative storage temperatures and life, and because of this the quality of stored commodity is badly affected. As such there is no commercially operated compartmentalized . Investor has an attraction of great earning because there is no competition and clients are abundantly available.

MOBI COLD BRANDING y In Coimbatore Mobi cold will create awareness and build brand through following mediums  APMCs 200  Primary agricultural societies 21000  Agricultural universities 5  Agricultural colleges 78
y

Sales
y

The product for sales are given for ready reference as well the expected sales at full capacity is also worked out in the table below.
Storage days Storage space Sq Ft Rate per Rs/Sq Ft 0.48 Amount 9,418,752

365.00

53,760.00

Total

9,418,752

RAW MATERIALS
y

This is a service industry and only main requirement is that of electricity. The consumption is worked out below.

Electricity cost growth rate 10% per annum Units consumed of Electricity in 5 110,965 Compartments Average unit cost of Electricity consumed (Rs.) Hours Operational per Day Days Operational per year 10 24 365

DISTRIBUTION CHANNELS
The features are described as follows y 3 DCs across Coimbatore with cumulative capacity-60000 sq ft y Storage temperature- 4-8o c y Contract rate- Rs 75/sq.ft/ month y Spot contract-Rs 7/crate/day.

Cont««..
Services offered by Mobi Cold y Mobi Cold storage crates y Loading and unloading at DC. y Packing, grading and coolant replenishment services y Shelving and disposal of waste. y Clients need to arrange for transportation and insurance for their consignments.

Distribution strategy
Mobi Cold will to a strategic tie-up with existing fertilizer and tractor distribution channel to facilitate public distribution centre for Mobi Cold. y It will offer them a 5-7 % distributor¶s margin on sales in return for their facilities and outlets. y We will also set up rent booking centers for crates and storage space outside 200 APMCs in Coimbatore where traders and producers meet.
y

HUMAN RESOUCE REQUIRMENT
Required Position Store manager 1 Supervisor Accountant Fork lifter Office attendant Helper Technician Watchman Total 1 1 1 1 3 1 2 11 Salary per month 25000 7000 5000 5000 2500 2500 4500 2500 Salary per annum 300000 84000 60000 60000 30000 90000 54000 60000 7,38,000

PROJECT FINANCIALS
y

OPERATIONAL DATA

The cold storage has maximum of 53,760 Sq ft area to be utilized. In the first year only 70 % space would be utilized however 100 % capacity would be utilized by forth year.
Year Capacity utilized Sq.ft space utilized 1 70% 37632 80% 43008 2 90% 48384 3 4 100% 53760 5 100% 53760

FIXED COST
y

The initial investment in terms of capital cost is Rs 13,377,200 and includes the items detailed below.
Assets Total cost (Rs) 4452200 8326000 599000 13377200

Land and Building Machinery and equipments Initial working capital Project cost

Working Capital
y

The investment in the initial working capital is of Rs 292,680
Store and spares Upfront land lease rental cash Working capital requirement 72680 140000 80000 292680

OVERHEAD COSTS
y

In the first year following overhead cost are estimated.
372000 43000 540000 7440 14180

Administrative and selling salaries Misc. expenses land lease rent expenses Office expenses Professional fees (legal , consultants etc)

Total

976,620

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