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Jammu and Kashmir Entrepreneurship Development Institute (JKEDI),

Seed Capital Fund Scheme (SCFS)

DETAILED PROJECT REPORT


On

TECHNo-ECONOMIC FEASIBILITY
OF
M/S. Alien Holidays and Hospitality Services
S/O:

D/O:

W/O:

Parentage:

UNDER

seed capital fund scheme


(scfs)
Legal Status:

Sole propreitership

Activity:

Travel & Tourism

Sector:

Service

Name of the Entreprenuer:

Mr/Ms.

Unit Address:

Sami-Ullah Lone
Mr/Ms. Gh.Mohi-Ud-Din Lone
Shopain
Rajbagh

District:

Srinagar

Tehsil:

Nawgam

Constituency:

Amera Kadal

Name of Father /Spouse:

Residential address:

E-mail:

teepoo.sultan40@gmail.com

Cell.No:

9797272337,Alt.No:9697033727

Date:

Dec-15

Jammu Campus: 0191-2474512/Kashmir Campus: 01933-224362/Ladhak Campus: 01982-252239


www.jkedi.org

Jammu and Kashmir Entreprenuership Development Institute


Seed Capital Fund Scheme (SCFS)

Project Profile
The Total Project Cost for the proposed venture is estimated at

16,46,523.93

Investment Plan
S.No.

Particulars

%age

Amounts

A
i
ii
iii
iv
v

Fixed Investments

45%

Land
Civil Works
Plant & Machinery
Mis.Fixec Assets
Preliminary Expenses

7,39,190.6
Rented
129890
412000
104000
93300.59739

Working Capital Requirement

55%

9,07,333.3

Total Project Cost

(A+B)

16,46,523.9

The amount if needed to make 35% Margin money, for availing Bank Finance of 65% of Total Project Cost
may be contributed by Entreprenuer himself,the said venture has funding pattern as:
S.No
Particulars
Percentage
Amount (Rs.)
1 Seed Capital
5,76,283
35%
2 Promoters Contributers
0
3 Bank Finance
65%
10,70,241
Total
100%
16,46,524
Likewise,the project will be financed under two accounts viz.

Term Loan A/c For Fixed Capital Investment

Cash Credit A/c for Working Capital Investment


S.No
A
i.
ii.

B
i.
ii.

Financing Pattern
Long Term Investment
Margin
Term Loan
Total (A)

Amount (Lkhs)
2,58,716.71
4,80,473.89
7,39,190.60

Working Cap Finance


Margin
Cash Credit A/c
Total (B)
Total Project Cost

Amount (Lkhs)
3,17,566.67
5,89,766.67
9,07,333.33
(A+B)

16,46,523.93

Project Parameters
i.
ii.
iii.
iv.
v.
vi.
vii.

Payback Back Period in Year


Moritorium Period in Months
Break-Even Analysis
Debt Service Coverage Ratio
Benefit-Cost Ratio
Employment Generation
Projected Sales/Revenue

4.9
6
49.56%
5.91
1.93
4
24,66,000.00

Jammu Campus: 0191-2474512/Kashmir Campus: 01933-224362/Ladhak Campus: 01982-252239


2
www.jkedi.org

Jammu and Kashmir Entreprenuership Development Institute


Seed Capital Fund Scheme (SCFS)
Background of Entreprenuer & Project
M/s. Alien Holidays & Hospitality Services is a sole propreitorship concern of Mr.Sami-Ullah Lone
S/o.Gh.Mohi-ud-Din R/o.Dangerpora,Shopain.The promoter is a young person with all necessary
qualifications, enthusiasm and energy to excel. M/S Alien Holidays and Hospitality Services is formed to
provide Tour & Travel packages with upscale accommodations, food, and services to domestic and
international clients. The founders of unit, in addition to his MBA in Travel,Tourism and Hospitality status
is passionate about the tourism activities. The opportunity for this venture exists for two reasons:
1. Tourism is a growing industry (4% annually) and within the industry, adventure travel is growing at 10%.
2. There are few providers of such packages it has to offer.
There is rapid growth in the market and increasing demand. In addition, more niche markets are evolving.
Initially, it will be difficult to compete with experienced providers, especially the market leaders. However,
the units target market is an exploitable niche and its service is differentiated. Alien Holidays and
Hospitality Services target market members will have similar activity interests, more disposable income
and less sensitivity to price. The package prices will be out of reach for the majority of travellers. Service
will be priced based upon l competitor prices and the value added of offering.
The unit is proposed to be located at on Rented land. Where all the basic infrastructural facilities viz: Water
connection, Power connection road connectivity is available as per the requirement. The proposed project
as such would not fact any difficulty for its smooth operation. The requirement of land for the project has
The Subsidy amount under Seed Capital Fund Scheme depends upon the educational
qualification of the borrower and is as:
S.No
1
2
3

Qualification
10+2 & Graduate
Post Graduate
Technical Graduate

Amount (Lkhs)
3,00,000.00
5,00,000.00
7,50,000.00

The Contents of DPR are given under following heading:


i
Introduction about Various Aspects of Project
ii

Assumptions of Project

iii

Fixed Capital Estimate

iv

Working Capital Estimate

Recurring Expenses

vi

Depreciation Schedule

vii

Projected Sales

viii

Projected Profit & Loss Account for Seven Years

ix

Projected Cash Flow Statement for Seven Years

Projected Balance Sheet for Seven Years

xi

Repayment Schedule for Seven Years

xii

Payback Period

xiii

Break-Even Analysis

xiv

Debt Service Coverage Ratio

xv

Benefit Cost Ratio Estimate

Jammu Campus: 0191-2474512/Kashmir Campus: 01933-224362/Ladhak Campus: 01982-252239


www.jkedi.org

Jammu and Kashmir Entreprenuership Development Institute


Seed Capital Fund Scheme (SCFS)

Introduction
Jammu & Kashmir is known by many names such as the Paradise on Earth, Crown of India etc.
and occupies a strategic place on the country's map with its borders touching Pakistan, Tibet and
China. The state has three distinct regions of Kashmir, Jammu and ladakh.Each region has a
specific resources base. it has a mountainous terrain, except for some portion of Jammu region
and Kashmir valley. The topography, cultures and languages vary greatly in these parts. Similarly
there is vast variation in case of tourism potentials of these parts. Jammu and Kashmir especially
Kashmir valley offers various categories of tourism. These include:
Adventure tourism
Medical tourism
Water rafting
Skiing
Religious tourism etc.
Tourism has become one of the largest and fastest growing economic activities. Its growth has
impact on employment, foreign currency earnings, revenue to the State exchequer and the
economy in general. The state of Jammu and Kashmir has immense potential for tourism from
both domestic as well as international tourists there are a number of locations which are untapped
and can be developed as major tourist destinations. Tourism being one of the states major
industries has played an important role for developing the economy, particularly in the Valley and
Ladakh regions. The industry is given jobs to a very large number of people and has generated
economic activities in the primary, secondary and tertiary sectors in the state, which owes
dependence to a large extent to this industry. Additionally, J&K is also likely to become a major
hub for medical tourism if timely steps are taken by the stakeholders to exploit this opportunity as
well.
Scope of The Unit
The venture is aimed at providing an the high end Tour & travel experience to natural, cultural
and Religious environments, besides , providing employment to the professionals in this industry .
At the same time the project will produce viable economic opportunities for other industries and
sectors in the state. As the unit will thrive and grow as Jammu and Kashmir is known for its
scenic landscape, beautiful valleys, lakes, snow capped mountains, cool climate, Skiing, trekking
and fishing opportunities, archaeological, historical, cultural and religious places all over the
world. The product packages to be sold in all the three regions have immense potential for
tourism from both domestic as well as international tourists. While mountainous landscape of
Kashmir valley has attracted tourists for centuries across the globe. Some notable tourist places in
Kashmir valley are Dal lake, Mughal gardens, Nishat Bagh, Gulmarg, Yeusmarg, Phalgam etc.
Kashmiris natural landscape has made it one of the popular destinations for adventure tourism in
South Asia. Jammu is known for its ancient temples, so the product packages developed to serve
pilgrims of holy shrine of Amaranth in Kashmir will attracts millions of Hindu devotees every
year. Vishnu Devi shrine in Jammu region also attracts tens of thousands of Hindu devotees
every year. Jammus historic monuments feature a unique blend of Islamic and Hindu architecture
styles. The State of Jammu and Kashmir is full of history.

Jammu Campus: 0191-2474512/Kashmir Campus: 01933-224362/Ladhak Campus: 01982-252239


www.jkedi.org

Jammu and Kashmir Entreprenuership Development Institute


Seed Capital Fund Scheme (SCFS)

Under the Antiques Act, any article that is more than 75 years old is to be declared heritage
property. Jammu and Kashmir is a land with more enormous potential for heritage tourism.
The land is full of natural beauty that is unique to the state. It is also bestowed with a variety
of cultural forms and manifestations that has their distinct flavour. It has diverse practices in
religion, rites and rituals, fairs and festivals, landscape and people, language and culture. The
valley of Kashmir offers sparkling streams, high mountains and verdant land that has the
classic beauty and attracts people from every corner of the world. The Kashmir valley has
been the chosen place for many film makers and artists in India. The history of the state still
lives in the forts, museums, ancient buildings and other heritage spots within the State. The
states leisure tourism potential is well recognized. However, the number of destinations
developed has remained practically static for the past few decades. This not only causes
congestion and pressure on natural resources of these regions but is also a potential recipe
for unbalanced growth. As mentioned earlier, incentives to the private sector are area
specific and this list is now being reviewed by the state government which is welcome. Some
potential tourist circuits are Mughal Road circuit which will require development of heritage
sites along the road,
Katra-Patnitop
Sansar-Dessa
Kapran-Pehalgam circuit
lake circuit in Ladakh,
Samba-Mansar circuit and
development of Srinagar city as a destination.
Border tourism provides yet another option to attract tourists and to start with a project has
been approved for developing the Suchetgarh border on the lines of the Wagah border. There
is a strong case for exploring this in the PPP mode for the locations. The other strategy that
can give quick returns is to attract religious tourists of Jammu to visit Jammu city and also
visit Srinagar and Ladakh for leisure tourism. The former requires development of
recreational activities within Jammu like investment in water sports, creation of shopping
malls, cultural festivals, craft Melas and exhibitions as potential tourist magnets.The latter
requires faster connectivity which in the case of Srinagar can be through a luxury Volvo bus
service to be operated by the state government. While for Ladakh it would mean persuading
the activities to introduce a Jammu-Ladakh flight at least 2-3 times a week to begin with.
Kashmir could also attract tourists by launching innovative fruit tourism during the periods
of harvesting.From tourism perspective, Jammu and Kashmir has always been one among
the favourite places of visit not only for domestic tourists but for the foreign tourists as well.
There has been an upward trend in terms of the number of foreign tourists visiting the State
since last five years and the trend is expected to continue to boost the economy of the State.
Tourism is an important sector of Indian economy and contributes substantially in the
countrys foreign exchange earnings (FEEs). Foreign exchange earnings from tourism, in
Rupee terms, during 2011, were Rs 77591 Crore, with a growth of 19.6%, as compared to
the foreign exchange earnings of Rs 64889 Crore during 2010. During 2011, foreign tourist
arrivals in India were 6.29 million, with a growth rate of 8.9% over 2010. Foreign tourist
arrivals in India during 2010 were 6.29 million, with a growth of 8.9% over 2010.
Jammu Campus: 0191-2474512/Kashmir Campus: 01933-224362/Ladhak Campus: 01982-252239
www.jkedi.org

Jammu and Kashmir Entreprenuership Development Institute


Seed Capital Fund Scheme (SCFS)

Foreign tourist arrivals in India during 2010 were 5.78 million as compared to the foreign
tourist arrivals of 5.17 million during 2009, showing a growth of 11.8%.Ladakh, the third
and important region of the State has emerged as a major hub for adventure tourism. This
part of Greater Himalaya called Moon on Earth comprising of naked peaks and deep
gorges was once known for the silk route to Asia from subcontinent.The visits from
domestic and international tourists provide a valuable source of earning. Visitors spending
generate income for both public and private sectors besides effecting wages and employment
opportunities. Till the year 2010 there was a negative growth rate in the tourist arrivals. But
during 2011-12 there was a significant Increase in volume of domestic as well as foreign
tourist arrivals in Kashmir.
J&Ks Share in Foreign Arrivals to India:
Year India J&K Percentage Share
2004 2537282 7806 0.31
2005 2384364 24330 1.02
2006 3457477 41000 1.19
2007 3918160 44345 1.13
2008 4447167 46087 1.04
2009 5081504 53053 1.04
2010 5356966 55000 1.03
2011 5167699 51255 0.97
Jammu and Kashmir is home to famous Hindu pilgrimages in India, where thousands of
Hindu community people visit the shrine of Amarnath cave and Mata Vaishno Devi every
year.Jammu and Kashmir is blessed with both tangible and the intangible heritage which
should be incorporated into the wider tourism circuit. The need is to treat heritage tourism in
this region as the function of the tourism only then it can thrive in the true tourism sense.
First, the heritage tourism assets of the region should be identified and then a proper
documentation mechanism has to be devised so that a proper inventory is developed which
can be integrated into a well defined tourism product by employing the proper marketing
strategy with the help of the multidisciplinary approach of the varied professionals, who can
constitute task force for the application of the mechanism developed from this integrated
process. Once this procedure is brought into action it will lead to the heritage tourism
development model that will lead to the bright prospects of the overall tourism business in
the region.
Tourists arrival from 2004 to 2010 in Jammu and Kashmir
Year
2004
2005
2006
2007
2008
2009
2010

AmarnathJi Kashmir Tourists Foreign Jammu Ladakh Foreign Total


400000
358000
19000 6100000 13000 22000 7724000
388000
585702
19680 6251998 13781 24665 8315654
265000
412879
20009 6950573 17822 26078 8434149
213565
417264
24576 7222318 22102 28477 8634286
498075
550100
22000 6576000 39000 33000 8860350
373419
520454
20809 7657000 48127 30446 9643517
458046
698564
24376 8239474 54684 21371 10753556

Location & Civil Works: The unit will be located at Rajbagh,Srinagar in a Rented
Accomodation which needs some renovation and as such will encounter no problem in
finding prospective clients as the entire place is a tourist hub.
Jammu Campus: 0191-2474512/Kashmir Campus: 01933-224362/Ladhak Campus: 01982-252239
www.jkedi.org

Jammu and Kashmir Entreprenuership Development Institute


Seed Capital Fund Scheme (SCFS)

The Govt Agencies at present providing Assistance to Entrepreneurs are:


Directorate of Tourism, Kashmir;
Directorate of Tourism, Jammu;
J&K Tourism Dev.Corporation;
Sher-e-Kashmir International Convention Centre;
J&K Cable Car Corporation;
Royal Springs Golf Course Society(RSGC);and
Jawahar Institute of Mountaineering & Water Sports (GOI organisation)
Marketing & Services:
The unit will use several different forms of communication for their marketing strategy. The
first effort will revolve around their Internet site. The unit is developing a website, they
recognize and attract the clients and will maintain the site as well as continually improve it.
Another form of communication is magazine advertising. The advertising will occur in
magazines whose readership has an extended demographics .The magazine advertisements
will be used to increase visibility and position it as the top service provider in the high-end
hard adventure market.
As time progresses and a loyal customer base is established, the unit will rely on email
newsletters and direct mail to the customers that are on the mailing list. The newsletters will
share specials (both trips as well as special deals) to this select group of customers. As
operations progress, the unit will continue to measure its progress relative to competitors and
to the growth of the market(s) in which it operates. Though the primary target market has
been defined, there may be new possibilities to serve additional segments. As the products
are defined and the strategy differentiation is defined based on competitive strengths, the
unit will be better able to determine whether adjustments in positioning are necessary.
Access to important information concerning the market, competitors, etc. The marketing
strategy will be to develop long-term relationships with customers. The promoter will keep
a database from which to obtain important demographic & psychographic information
amongst all age groups. As the business becomes profitable, plans will be implemented to
expand. Trips can take place in every state .The goal is to establish this unit as an
international provider of Tour & Travels provider.The promoter will market the packages
in their respective areas with relevant publicity material including their respective
websites/Videos/Photographs.
Development of Tourism Package for :
Heritage;
Adventure;
Pilgrim;&
Eco-Tourism
Forest based activities
River bound activities
Culture bound activities
The products/Services are as:
Pilgrimage Package
Tour Packages (Local)
Tour Packages (Domestic)
Jammu Campus: 0191-2474512/Kashmir Campus: 01933-224362/Ladhak Campus: 01982-252239
www.jkedi.org

Jammu and Kashmir Entreprenuership Development Institute


Seed Capital Fund Scheme (SCFS)

Picnic/Excursions/Adventure Sports Packages


Ticketing Service Charges
Movies/Documentaries/Serials Shooting Packages
Human Resource
All the staffing will be done by the promoter operator but there will be fixed sum to be paid
monthly and positions are as:
General Manager (Self)
Reservation Manager
Accounts Manager
Marketing Executive
Peon/Sweeper
Accounting
The promoter shall keep and maintain all necessary statutory records and financial books of
accounts, on a monthly basis.The most important accounting procedures for a travel agency
are the cash flow statement, the general ledger and the income statement.The income
statement serves a similar purpose as the cash flow statement. While the cash flow statement
only keeps track of cash, the income statement measures the profits of your business,the cash
flow statement is more important as you get the handle of your company's daily cash flow. In
the long-run, your income statement is more important as it gives a better description of your
company's total profitability.

Jammu Campus: 0191-2474512/Kashmir Campus: 01933-224362/Ladhak Campus: 01982-252239


www.jkedi.org

Jammu and Kashmir Entreprenuership Development Institute


Seed Capital Fund Scheme (SCFS)

Assumptions of Project:
S.No

Remarks

Discription

Business

Services

Legal Structure

Sole Propreitorship

Sales

Daily Basis

Subscriptons

Annual

Accounting Cycle

Annual

Labor Department

Registration Under Shop & Establsihment Act

Sales Tax Depratment

Sales Tax Registration

Income Tax Department

PAN Card

10

Lower Court

Rent Deed,Affidavit

11

Pollution Control Board

NOC

12

Tourism Department

License

13

Local Bodies

Permission

14

Insurance

3 Percent of Equipment

15

Pre-Operative Expenses

Interest during Moratorium & Legal Expenses

16

Cost of Equipment

Price on approximate value for make/model

17

Cost Structure

Vary with Time & Location

18

Capacity utilization

Single shift bais for 300 days a year

19

Efficiency

20

Layout

NB:-

100% basis
As per Occupational Requirement

Projections are not made on the Basis of Financial or Calender Year.But on the basis of
Average of Business Cycles (Peak and Slak Season) in 12 Months Period.

Jammu Campus: 0191-2474512/Kashmir Campus: 01933-224362/Ladhak Campus: 01982-252239


www.jkedi.org

Jammu and Kashmir Entreprenuership Development Institute


Seed Capital Fund Scheme (SCFS)
Fixed Capital Investment
1

Civil Work
Cabin (Development)

Dimensions
22'X15'X10

Renovation
2

Area Sq.ft

Rate/Sq.ft

Rate in Rs.

330

333

109890
20000

Inside & Outside of Office

Sub-Total
Machinery/Equipement/Services
Skiing Equipments Kits
Gas Heaters
A.C
Desktop Computer System
Laptop
Printer 3 in 1
Handicam System
Water Heater (Gyser)
Exhaust Fan
Reservation Software (CSR/GDS)
Telephone System
WIFI
Binocular Camera with Microphone System
Fishing Rod Cum Accessories
Fax Machine
Cell Phones
Website cum Logo Design

129890.00

Quantity
3
2
1
2
1
1
1
1
1
1
4
1
1
1
1
3
1

Rate
14000.00
10000.00
35000.00
25000.00
35000.00
15000.00
55000.00
15000.00
1500.00
25000.00
1250.00
3500.00
50000.00
5000.00
10000.00
5000.00
30000.00

Sub-Total
3

Miscellaneous Assets
Tables & Chairs
Water Purifier
Invertor
Transformer (2.5 Kv)
Fire Extinguisher

412000.00

Quantity
6
1
1
1
1

11500.00
4000.00
20000.00
8000.00
3000.00

Sub-Total
4

Preliminary Expenses
Legal Expenses
Internet Subscription (Months)
Printing & Stationery
Registration,Licencing & Certification Fee
Interest During moratorium
DPR
Sub-Total
Grand Total

Amount
42000.00
20000.00
35000.00
50000.00
35000.00
15000.00
55000.00
15000.00
1500.00
25000.00
5000.00
3500.00
50000.00
5000.00
10000.00
15000.00
30000.00

Amount
69000.00
4000.00
20000.00
8000.00
3000.00
104000.00

Quantity

Rate

5000.00

6 Months
1

2000.00

Amount
4000.00
20000.00
1000.00
40000.00
25300.60
2000.00
93,300.60

7,39,191

Jammu Campus: 0191-2474512/Kashmir Campus: 01933-224362/Ladhak Campus: 01982-252239


10
www.jkedi.org

Jammu and Kashmir Entreprenuership Development Institute


Seed Capital Fund Scheme (SCFS)
Working Capital Estimate
The working capital requirement is calculated on the basis of Operating Cycle of the activity.In this case it
Calculated as.
Working Capital Requirement
Amount (Lkhs)
Margin (Seed Money & Promoters Contribution)
3,17,566.67
Working Cap Finance from Bank
5,89,766.67
Total

9,07,333.33

S.No.

Particulars

Amount Per
Month

Marketing & Advertising Expenses

48000

Purchases

145833

Utilities & Upkeep

3000.00

General Expenses

30000.00

Total

Total Amount

2,26,833

Working Capital Requirement for Four Months

9,07,333.33

Jammu Campus: 0191-2474512/Kashmir Campus: 01933-224362/Ladhak Campus: 01982-252239


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Jammu and Kashmir Entreprenuership Development Institute


Seed Capital Fund Scheme (SCFS)
Purchases of Services/Expenses as Per Turnover
Costs incurred on the Purchases of Services on Annual Basis as:
S.No Particulars
Items/Services

No. of Units

Rate Per Unit

TTF & OTM (Metropolitan)

200000

ACA Ticketing (Amarnath) For Two Months

30

4000

ACA Ticketing (Katra)

70

4000

Air Ticketing (Bulk Booking)

110

5000

Amount

800000
120000
280000
550000

Total

17,50,000

Revenue from Services


Revenue from services is reliased on daily basis.
S.No Particulars
1

Pilgrimage Package

Tour Packages (Local)

Tour Packages (Domestic)

Picnic/Excursions/Adventure Sports
Packages

Ticketing Service Charges

Corporate Tour Groups

Amarnath Yatra Chopper Tickets (Two


Months)
Total

Services Sold
per Month

Rate/Package

Amount Per
Month

Amount Per
Annum

10

6000

60000

720000

10

3000

30000

360000

15000

75000

900000

5500

27500

330000

20

250

5000

60000

16000

80000

960000

100

3900

390000

780000

6,67,500

41,10,000

Jammu Campus: 0191-2474512/Kashmir Campus: 01933-224362/Ladhak Campus: 01982-252239


12
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Jammu and Kashmir Entreprenuership Development Institute


Seed Capital Fund Scheme (SCFS)
Annual Recurring Expenses
A

Wages & Salaries :

S.No
1
2

Particulars

General Manager (Self)


Reservation Manager
Reservation
Executive/Accounts
Peon/Sweeper
Total

3
5

B
S.No
1
2
3

No. of

Amount

Amount

Worker

Per Month

Per Annum

20000

240000

15000

180000

8000

96000

4000

48000

47000

564000

Utilities & Upkeep


Particulars

Per Month

Per Annum

2000

24000

833

10000

167

2000

3000

36000

Heating & Lighting*


Water (Purifying Kit)
Disinfectant & Air Wick
Total

*2 Kwh required at a monthly rental of Rs.2000 flat

C
S.No
1
2

Repairs & Maintenance:


Particulars

Building
Equipement

Amount
42000
69000

%age

Per Month

Per Annum

1%
8%

35

420

460

5520

495

5940

Total

D Marketing & Advertising Expenses:


S.No
Particulars
Per Month
1
2
3
4

E
S.No
1
2
3
4
5

Per Annum

Marketing (Online & Offline)

16666.67

200000.00

Advertising

15666.67

188000.00

Promotions

15666.67

188000.00

Total

48000.00

576000.00

General Expenses :
Particulars

Rent
Telephone Expenses
Stationery & Postage
Transportation
Miscellaneous Expenses

Total

Quantity

Per Month

Per Annum

LS
LS
LS
LS
LS

8000

96000

5000

60000

1000

12000

10000

120000

6000

72000

30000

360000

Jammu Campus: 0191-2474512/Kashmir Campus: 01933-224362/Ladhak Campus: 01982-252239


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Jammu and Kashmir Entreprenuership Development Institute


Seed Capital Fund Scheme (SCFS)
STATEMENT SHOWING THE DEPRECIATION ON FIXED ASSETS
The Depreciation is calculated under Written-Down Value Method (WDV) with preliminary expenses amortized in 5
years.

BUILDING @ 5.00%
Particulars
Opening Balance
Depreciation
Closing Balance

1st Year

2nd Year

3rd Year

4th Year

5th Year 6th Year 7th Year

129890

123396

117226

111364

105796

100506

95481

6495

6170

5861

5568

5290

5025

4774

123396

117226

111364

105796

100506

95481

90707

EQUIPMENT @ 10.00%
Particulars

1st Year

2nd Year

3rd Year

4th Year

5th Year 6th Year 7th Year

Opening Balance

412000

370800

333720

300348

270313

243282

218954

Depreciation

41200

37080

33372

30035

27031

24328

21895

Closing Balance

370800

333720

300348

270313

243282

218954

197058

MISCELLANEOUS ASSETS @ 10.00%


Particulars

1st Year

2nd Year

3rd Year

4th Year

5th Year 6th Year 7th Year

Opening Balance

104000

93600

84240

75816

68234

61411

55270

Depreciation

10400

9360

8424

7582

6823

6141

5527

Closing Balance

93600

84240

75816

68234

61411

55270

49743

PRELIMNERY EXPENSES
Particulars

1st Year

2nd Year

3rd Year

4th Year

5th Year 6th Year 7th Year

Opening Balance

93301

74640

55980

37320

18660

Less:

18660

18660

18660

18660

18660

Closing Balance

74640

55980

37320

18660

Assets Net of Depreciation


Particulars

1st

2nd

3rd

4th

5th

6th

7th

Building

123396

117226

111364

105796

100506

95481

90707

Equipment

370800

333720

300348

270313

243282

218954

197058

Miscellaneous Assets

93600

84240

75816

68234

61411

55270

49743

Net Block

587796

535186

487528

444344

405199

369705

337508

Total Depreciation

58095

52610

47657

43185

39145

35495

32196

Jammu Campus: 0191-2474512/Kashmir Campus: 01933-224362/Ladhak Campus: 01982-252239


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14

Jammu and Kashmir Entreprenuership Development Institute


Seed Capital Fund Scheme (SCFS)
Projected Profitability statement for Seven years of operation of unit
The projected income staement gives a snapshot of yearly performance of project and ins presented below:
S.No.
Particulars
A Year of Operation
B Capacity Utilization (%)
C Sales/Revenue
Less: Sales Return
Less: Cash Discount
Net Sale Revenue
Less : Cost of Sales
Opening stock
Purchases
Salary & Wages
Sub-Total

Operating Years
1st

2nd

3rd

4th

5th

6th

7th

60%

60%

70%

70%

80%

80%

90%

2466000

2466000

2877000

2877000

3288000

3288000

3699000

2466000

2466000

2877000

2877000

3288000

3288000

3699000

1050000

1050000

1225000

1225000

1400000

1400000

1575000

338400

338400

394800

394800

451200

451200

507600

1388400

1388400

1619800

1619800

1851200

1851200

2082600

D Gross Profit on Sales


1077600 1077600
Less: Operating
Overhead Expenses
General Expenses
216000
216000
Utilities & Upkeep
21600
21600
Repairs & Maintenance 3564
3564
Depreciation
58095
52610
Sub-Total
299259
293774
Less: Operating
MarketingExpenses
& Advertising Expenses:
Marketing
120000
120000

1257200

1257200

1436800

1436800

1616400

252000

252000

288000

288000

324000

25200

25200

28800

28800

32400

4158

4158

4752

4752

5346

47657

43185

39145

35495

32196

329015

324543

360697

357047

393942

140000

140000

160000

160000

180000

112800

112800

131600

131600

150400

150400

169200

112800

112800

131600

131600

150400

150400

169200

345600

345600

403200

403200

460800

460800

518400

644859

639374

732215

727743

821497

817847

912342

Operating Profit
Less: Financial Expenses
Interest on Term Loan
Interest on Working Capital
Discount Allowed
Less: Other Expenses
Preliminary expenses
Sub-Total
G
Profit Before Tax
Less: Taxation

432742

438226

524985

529457

615303

618953

704058

23999
5283

43802
5283

37684
5283

30874
5283

23296
5283

14861
5283

5473.8061

18660

18660

18660

18660

18660

47942

67746

61627

54818

47239

20145

10757

384799

370481

463357

474640

568064

598809

693300

H Profit After Tax

384799

370481

463357

474640

568064

598809

693300

Reserves & Surplus


384799
Appropriations
Less: Drawings
0
Term Loan Repayments 48667
Sub-Total
48667
Net Profit
336132

755280

1218637

1693277

2261341

2860150

3553450

54164
54164

60283
60283

67092
67092

74671
74671

83105
83105

92492.535

316316

403075

407548

493394

515704

600808

Advertising
Promotions
Sub-Total
E

Gross Expenses

5283

92493

Jammu Campus: 0191-2474512/Kashmir Campus: 01933-224362/Ladhak Campus: 01982-252239


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15

Jammu and Kashmir Entreprenuership Development Institute


Seed Capital Fund Scheme (SCFS)
Projected Cash Flow Statement for Seven years
S.NO.

Particulars

Cash flow from operating activities

YEAR 1

YEAR 2

YEAR 3

YEAR 4

YEAR 5

YEAR 6

YEAR 7

Receipts from customers

2466000

2466000

2877000

2877000

3288000

3288000

3699000

Payments to service Providers

1050000

1050000

1225000

1225000

1400000

1400000

1575000

Wages & Salaries

338400

338400

394800

394800

451200

451200

507600

Utilities & Upkeep

21600

21600

25200

25200

28800

28800

32400

Repairs & Maintenance

3564

3564

4158

4158

4752

4752

5346

Selling & Distribution

345600

345600

403200

403200

460800

460800

518400

General Expenses

216000

216000

252000

252000

288000

288000

324000

5283

5283

5283

5283

5283

5283

5283

1980447

1980447

2309641

2309641

2638835

2638835

2968029

485553

485553

567359

567359

649165

649165

730971

Re-Payments of borrowings

-48667

-54164

-60283

-67092

-74671

-83105

-92493

Payment of Interest

-23999

-43802

-37684

-30874

-23296

-14861

-5474

Net cash flow from Financing activities

1573858

-97966

-97966

-97966

-97966

-97966

-97966

Net increase (decrease) in cash held

1320220

387586

469392

469392

551198

551198

633004

Cash at beginning of period

1320220

1707807

2177199

2646591

3197790

3748988

Cash Accruals

1320220

1707807

2177199

2646591

3197790

3748988

4381992

Cash at Bank

412887

800473

1269866

1739258

2290456

2841655

3474659

Interest on Working Capital

Total
Net cash flow from operating activities

Cash flow from investing activities

Establishment
Net cash flow from investing activities

739191
-739191

Cash flow from financing activities

Promoters Contribution

Proceeds from Borrowings

1070241

Seed Capital

576283

Drawings

WC

1320220
NP
WC
DEP
PRLM
REP

1320220
384799
907333
58095
18660
-48667

Jammu Campus: 0191-2474512/Kashmir Campus: 01933-224362/Ladhak Campus: 01982-252239


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16

Jammu and Kashmir Entreprenuership Development Institute


Seed Capital Fund Scheme (SCFS)
Projected Balance Sheet for Seven years
Liabilities

1st Year

2nd Year

3rd Year

4th Year

5th Year

6th Year

7th Year

576283

576283

576283

576283

576283

576283

576283

576283

Balance of Term Loan 480474

431807

377643

317360

250268

175598

92493

Share Capital

Working Capital

589767

589767

589767

589767

589767

589767

589767

Reserve & Surplus

384799

755280

1218637

1693277

2261341

2860150

3553450

19,82,656

22,98,973

27,02,048

31,09,595

36,02,989

41,18,693

47,19,500

1st Year

2nd Year

3rd Year

4th Year

5th Year

6th Year

7th Year

645890

587796

535186

487528

444344

405199

369705

Depreciation

58095

52610

47657

43185

39145

35495

32196

Net Block

587796

535186

487528

444344

405199

369705

337508

74640

55980

37320

18660

907333

907333

907333

907333

907333

907333

907333

412887

800473

1269866

1739258

2290456

2841655

3474659

19,82,656

22,98,973

27,02,048

31,09,595

36,02,989

41,18,693

47,19,500

Total

1056757

Assets
Gross Block

Preliminary Expenses
Current Assets

645890

93301
317567

Cash & Bank Balance


Total

1056757

Jammu Campus: 0191-2474512/Kashmir Campus: 01933-224362/Ladhak Campus: 01982-252239


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17

Jammu and Kashmir Entreprenuership Development Institute


Seed Capital Fund Scheme (SCFS)
Repayment Schedule Yearly
Repayment of Principle amount along with Interest payments is calculated at the rate of 10.75% per
annum,the repayment period of Seven years and the moratorium period is of two quarters,in which an
enterprenuer is going to pay an interest amount only.
S.No. Particulars

1st Year

2nd Year

3rd Year

4th Year

5th Year

6th Year

7th Year

Balance

480473.9

431807

377643

317360

250268

175598

92493

Principle

-48667

-54164

-60283

-67092

-74671

-83105

-92492.5

Interest

-23999

-43802

-37684

-30874

-23296

-14861

-5473.81

Cash Outflow

-72666

-97966

-97966

-97966

-97966

-97966

-97966

5th Year

6th Year

7th Year

Working Capital Finance


S.No. Particulars

1st Year

2nd Year

3rd Year

4th Year

Margin

317566.7 317566.7 317566.7 317566.7 317566.7 317566.7 317566.7 317566.7

CC Limit

5,89,767

589767

589767

589767

589767

589767

589767

589767

Interest

-5283

-5283

-5283

-5283

-5283

-5283

-5283

Cash Outflow

5283

5283

5283

5283

5283

5283

5283

Jammu Campus: 0191-2474512/Kashmir Campus: 01933-224362/Ladhak Campus: 01982-252239


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18

Jammu and Kashmir Entreprenuership Development Institute


Seed Capital Fund Scheme (SCFS)
Pay Back Period

Year

NCI

CFAT

CCF

1646524

-1646524

-1646524

384799

-1261725

370481

-891244

463357

-427887

474640

46753

568064

614817

598809

1213626

693300

1906926

Payback Period In Years

4.90

Given initial investment of the project the projected Cash inflows provide and estimate for how long will it
take to recover the initial investiment in the project.

Jammu Campus: 0191-2474512/Kashmir Campus: 01933-224362/Ladhak Campus: 01982-252239


19
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Jammu and Kashmir Entreprenuership Development Institute


Seed Capital Fund Scheme (SCFS)
Break-Even Analysis
It suggests the level of capacity utilization,which the unit must attain in order to avoid any loss.
Particulars

Ist

2nd

3rd

4th

5th

6th

7th

A)

Sales

2466000

2466000

2877000

2877000

3288000

3288000

3699000

B)

Variable cost
Purchases

1636764 1636764 1909558 1909558 2182352 2182352 2455146


1050000 1050000 1225000 1225000 1400000 1400000 1575000

Utilities

21600

21600

25200

25200

28800

28800

32400

Marketing & Advertising

345600

345600

403200

403200

460800

460800

518400

General Expenses

216000

216000

252000

252000

288000

288000

324000

3564

3564

4158

4158

4752

4752

5346

Repairs & Maintenance

C)

Contribution

829236

829236

967442

967442 1105648 1105648 1243854

D)

Fixed costs

439153

453472

498801

487519

532301

501556

545270

Interest Payments

23999

43802

37684

30874

23296

14861

5474

Depreciation on Building

6495

6170

5861

5568

5290

5025

4774

Depreciation on Equipment

41200

37080

33372

30035

27031

24328

21895

Depreciation on Misc. Assets

10400

9360

8424

7582

6823

6141

5527

Ammortization of Expenses

18660

18660

18660

18660

18660

Salary & Wages

338400

338400

394800

394800

451200

451200

507600

52.96%

54.69%

51.56%

50.39%

48.14%

45.36%

43.84%

E)

B-E Point (%)

F)

Avg.B-E Point (%)

49.56%

Jammu Campus: 0191-2474512/Kashmir Campus: 01933-224362/Ladhak Campus: 01982-252239


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20

Jammu and Kashmir Entreprenuership Development Institute


Seed Capital Fund Scheme (SCFS)
Detailed Debt Service Coverage
The debt service coverage ratio shows the ability of the unit to repay interest and principal amount of
composite loans.
S.no

Particulars

1st

2nd

3rd

4th

5th

6th

7th

Source of funds

Profit after tax

384799

370481

463357

474640

568064

598809

693300

Depreciation

58095

52610

47657

43185

39145

35495

32196

Interest on term loan

23999

43802

37684

30874

23296

14861

5474

Total A

466893

466893

548699

548699

630505

649165

730971

Disposition of funds

Repayment of term loan

48667

54164

60283

67092

74671

83105

92493

Total B (3+4)

72666

97966

97966

97966

97966

97966

97966

6.43

4.77

5.60

5.60

6.44

6.63

7.46

Debt service coverage ratio

Average DSCR

5.91

Jammu Campus: 0191-2474512/Kashmir Campus: 01933-224362/Ladhak Campus: 01982-252239


21
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Jammu and Kashmir Entreprenuership Development Institute


Seed Capital Fund Scheme (SCFS)
Benefit Cost Ratio
The table is an estimate of profitibility index that the project may attain and should be preferably
greater than one.
Particulars

Ist

2nd

3rd

4th

5th

6th

739190.6

2033259

2033259

2033259

2033259

2033259

2033259

2772449

2033259

2033259

2033259

2033259

2033259

Service Revenue

4110000

4110000

4110000

4110000

4110000

4110000

Total Cost

4110000

4110000

4110000

4110000

4110000

4110000

Net Benefits

1337551

2076742

2076742

2076742

2076742

2076742

BCR

1.482444 2.021386 2.021386 2.021386 2.021386 2.021386

Avg.BCR

1.931562

S.No.

Costs
Capital Cost
Recurring Cost
Total Cost

Benefits

Jammu Campus: 0191-2474512/Kashmir Campus: 01933-224362/Ladhak Campus: 01982-252239


22
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