Army Welfare Trust

Biodegradable Tableware Manufacturing Facility

Financial Model - Assumptions

1. Parts of Machines with Useful Life of one year or less (repair and maintenance)
2. Component wise cost and useful life
3. How is USD 50 dollar maintenance cost calculated?
4. Understanding capacity of the plant (how it is being calculated) e.g. mold, cycle time etc. Linking raw material compositi
5. Reason for wide ranges?
6. Many figures are different from the information provided by PH?
7. Details of factory workers required (efficiency depends on how well the workers work). Packing, loading, unloading???
8. Packing Material and Sizes (Finished Products)
9. Packing of Raw Materials and their CBMs. Packing of finished goods and CBM of packing
10. Identifying Installation Costs in PKR (Probably Based on Quotations)
11. Understanding the difference between bamboo pulp, bagasse pulp and eculaptus (cost, charecteristic, difference in fin
11. Modelling Different Raw Materials (Bamboo Pulp, Bagasse Pulp and Eculaptus Pulp)
12. Difference between capacity and raw material consumption
13. Raw Materials Inputs to Outputs Ratio
14. Raw Material to Finished Product (Input to Output Ratio)
15. Separate Costing for Pulping
16. Separaate Costing for Forming and Trimming.
Financing and Fixed Assets Assumptions (Other than Costing in relevant schedules with timelines and stuff)
17. Royalties and licensing fee to PH
18. The actual Loan amount will be in PKR. The liability balances and payment amounts will be incorrect in dollars. This ne
19. Similarly, the actual finance lease is in PKR and converting the finance lease to USD at start and then amortizing will be
20. Because the reporting currency, payments of taxes, duties and everything will be in PKR (except purchase of raw mate
The purchase of plant and machinery will be converted into pkr at spot rate. All other expenses are in PKR. Only sales and
Export processing zones and SEZs allow offshore accounts.
A rupee financial model will be more aligned to the operational model of the business.
Ideally speaking, interest shall only have an impact on exports and imports.

Within SEZ there is assurance that incentives will continue to exist (but outside SEZ, laws can change such as exemption o
nking raw material composition, machine capacity, product fact sheet to drive production plan.

king, loading, unloading???

harecteristic, difference in final product)

nes and stuff)

e incorrect in dollars. This needs to be incorporated into the model e.g. making schedule in PKR and then converting in USD. This will pr
t and then amortizing will be misleading.
xcept purchase of raw materials and sales), its better to build a rupee financial model.
es are in PKR. Only sales and purchases will be in USD (where most of the payments can be offset thus reducing the exchange rate impa

change such as exemption of import duties)

verting in USD. This will probably enhance margins (for investment appraisal).

ng the exchange rate impact).

Army Welfare Trust
Biodegradable Tableware Manufacturing Facility
Financial Model - Assumptions

NANYA Plant and Machinery - Specifications Range Low High Average

Capacity (Kgs per Hour) 320-480 320 480 400
Workshop Area Requirement (Sq. M) 3000-3500 3000 3500 3250
Raw Materials (Pulp) Consumption per Hour (Kgs) 320-480 320 480 400
Electricity Consumption (KWH) 300-340 300 340 320
Fuel (Gas) Consumption (CMH) 150-170 150 170 160
Water Consumption (kgs) 960-1400 960 1400 1180
Water Consumption (Cubic Meter per Hour) .96 - 1.4 0.96 1.4 1.18
Chemical for Water Resistance 12-18 12 18 15
Chemical for Oil Resistance 3.2-4.8 3.2 4.8 4
Operators Required (Per Shift) 35-40 35 40 37.5
Daily Repair and Maintenance Cost 50 50 50 50
Useful Life (Years) 20 20 20 20

Raw Material (Pulp Slurry) Composition

Pulp

Product Specifications Plates

Weight (grams) 21
Size (cm) 25
Army Welfare Trust
Biodegradable Tableware Manufacturing Facility
Financial Model - Assumptions

Property, Plant and Equipment

Plant and Machinery Cost and Specifications Costs / Specs
Purchase Price (Based on Quotation) Nanya
Main Equipment Price $ 1,803,000.00
Auxiliary Equipment Price $ 293,840.00
Total $ 2,096,840.00

Installation Costs (Based on Info. From PH) Supplier

Cost Component Nanya
Pipe Work $ 15,000.00
Electrical Cables $ 35,000.00
Switchgear $ 28,000.00
Pulp Storage and Water Tanks (3) $ -
Drainage Works $ -
Supplier's Engineers $ -
PH Support Cost $ -
Total Installation Costs $ 78,000.00
Purchase Price plus Installation Costs $ 2,174,840.00
Contingencies 5%
Estimated Final Cost of Production Plant 2,283,582.00

Plant and Machinery - Specifications Nanya

Capacity (Kgs per Hour) 400.00
Workshop Area Requirement (Sq. M) 3,250.00
Raw Materials (Pulp) Consumption per Hour (Kgs) 400.00
Electricity Consumption (KWH) 320.00
Fuel (Gas) Consumption (CMH) 160.00
Water Consumption (kgs) 1,180.00
Water Consumption (Cubic Meter per Hour) 1.180
Chemical for Water Resistance 15.00
Chemical for Oil Resistance 4.00
Operators Required (Per Shift) 38.00
Daily Repair and Maintenance Cost 50.00
Useful Life (Years) 20.00

Land Cost Cost (PKR)

Area Requirements for 1 x 16 x 16 Plant (Square Meter) 3,250.00
Future Expansion Requirements (Square Meter) 3,250.00
Total Area Requirements 6,500.00
Warehouses and Service Areas 1,000.00
Total Area Requirements (Square Meter) 7,500.00
Total Area Requirements (Acres) 1.85
Price per Acre (PKR) 7,500,000.00
Total Cost of Land (PKR) 13,899,184.58
Exchange Rate 165.00
Total Cost of Land (USD) 84,237.48

Building Cost (PKR)

Factory / Workshop Square Meter) 3,250.00
Warehouses and Service Areas (Square Meter) 1,000.00
Total Covered Area (Square Meter) 4,250.00
Total Covered Area (Square Feet) 45,746.58
Construction Cost per Square Feet (PKR) 1,600.00
Total Building Cost - PKR 73,194,520.00
Contingencies 10%
Total Building Cost & Contingencies (PKR) 80,513,972.00
Exchange Rate 165.00
Total Building Cost & Contingencies (USD) 487,963.47

Furniture, Fixtures and Equipment Cost (PKR)

Furniture and Fixtures 2,000,000.00
Office Equipment 1,500,000.00
Total Cost of Furniture, Fixtures and Equipment (PKR) 3,500,000.00
Exchange Rate 165.00
Total Cost of Furniture, Fixtures and Equipment (USD) 21,212.12

Production Capacity and Inputs

Production Capacity Plates (Units)
No. of Shifts per Day 3
Hours per Shift 8
Working Days per Year 310
Total Production Capacity per Hour (No. of Units) 19,048
Efficiency 90%
Annual Production / Machine Operating Hours 7440
Annual Production Capacity (No. of Units) 127,542,857.14

Raw Materials Consumption and Cost Virgin Pulp

Raw Material Consumption per Unit (grams) 21.00
Wastage (% of Raw Material Consumption per Unit) 1.50%
CNF Karachi Price (USD) per Tonn $ 900.00
Custom Duty
Sale Tax
Income Tax
Additional Custom Duty
Landed Cost per Tonn (USD) 900.00

Raw Materials - Port Clearing Charges Virgin Pulp

Port Clearing Charges (as % of Landed Cost) 5%
Raw Materials - Transportation Cost Virgin Pulp
Weight per Container (Tonns) ### 50.00
Transportation Cost per Container (PKR) 60,000.00
Transportation Cost per Tonn (PKR) 1,200.00

Labour Cost Amount

Minimum Wage in Pakistan - Unskilled 17,500.00
AWT Retention Premium 30%
Proposed Monthly Salary - Unskilled Labour 22,750.00
Months in a Year 12.00
Yearly Cost / Labour 273,000.00
No. of Working Days 310.00
Per Day Per Labour Cost 880.65
Working Hours 8.00
Per Hour Rate - PKR 110.08

Water, Gas and Electricity Consumption per Hour

Electricity 320.00
Gas 160.00
Water 1.18

Administrative Expenses
Staffing Plan, Remuneration and Insurance No. of Employees
CEO / Managing Director 1
Finance Manager 1
Production Manager 1
Sales and Distribution Manager 1
Supply Chain Manager 1
HR Manager 1
Warehouse Manager 1
Accounts and Finance Executives 2
Production Supervisers 2
Sales Executives 2
Supply Chain Executives 2
Admin and Support Staff 2
Production Workers 132
Total 149.00

Utilities Monthly
Utilities - Telephone 20,000.00
Utilities - Internet 20,000.00
Utilities - Electricity 50,000.00
Office Supplies 25,000.00
Total Utilities Expenses 115,000.00

Repair and Maintenance - Plant and Machinery Daily

Day to Day Repair and Maintenance (USD) 50.00
Other Expenses Monthly
Carriage Outwards Expenses 120,000.00
Fire and Safety Insurance 100,000.00

Sale Price and Advertising Expense

Other Assumptions % / Amount
Advertising and Business Development Expense (% of Sales) 0.50%
Sale Price (USD) 0.059

Working Capital Requirements

No. of Days in a Year 365
No. of Working Days in a Year 310
Credit Terms with Customer (PH) - Days 30
Credit Terms with Suppliers 21
Suppllier Lead Time (Days) 30
Supplier Warehouse to Port (Days) 3
Processing at Port (Days) till Vehicle Departure 7
In Transit Time (Days) 10
Karachi Port Processing Time (Days) till Ready for Delivery 7
Delivery and Unloading (Days) 3
Allowance for Uncertainities (Days) 5
Total Raw Material Inventory Days 65
 BeSure HGHY

BeSure HGHY
$ 15,000.00 $ 15,000.00
$ 35,000.00 $ 35,000.00
$ 28,000.00 $ 28,000.00
$ - $ -
$ - $ -
$ - $ -
$ - $ -
$ 78,000.00 $ 78,000.00
$ 78,000.00 $ 78,000.00
5% 5%
81,900.00 81,900.00

BeSure HGHY
Water Repellent Oil Repellent
0.79 0.21 Plate Weight is 21 gram. Water is evaporated. What happens to the w
1.50% 1.50%
$ 1,000.00 $ 1,000.00

1,000.00 1,000.00

Water Repellent Oil Repellent

5% 5%
 Water Repellent Oil Repellent
50.00 50.00 Shall be calculated based on CBM of raw materials. Info from PH or Su
60,000.00 60,000.00
1,200.00 1,200.00

Unit Rate per Unit (PKR)

KW 21.43 Previously this was PKR 5.62. Now its 21.43 as per the document attac
Cubic Meter 28.98 Previously this was based on 1,054 per MMBTU. Now this is based on
Cubic Meter 60.00

Monthly Salary Monthly Salary Expense Yearly Salary Expense

1,200,000.00 1,200,000.00 14,400,000.00
450,000.00 450,000.00 5,400,000.00
450,000.00 450,000.00 5,400,000.00
300,000.00 300,000.00 3,600,000.00
200,000.00 200,000.00 2,400,000.00
200,000.00 200,000.00 2,400,000.00
150,000.00 150,000.00 1,800,000.00
80,000.00 160,000.00 1,920,000.00
80,000.00 160,000.00 1,920,000.00
50,000.00 100,000.00 1,200,000.00
50,000.00 100,000.00 1,200,000.00
40,000.00 80,000.00 960,000.00
- - -
3,250,000.00 3,550,000.00 42,600,000.00

Yearly
240,000.00
240,000.00
600,000.00
300,000.00
1,380,000.00

Yearly
15,500.00
Yearly
1,440,000.00 Assumptions about Order Sizes (purchase and Sales), Frequency, CBM
1,200,000.00 Assumption Needs to be validated
Water is evaporated. What happens to the weight of oil and water repellent chemicals?
 on CBM of raw materials. Info from PH or Supplier

.62. Now its 21.43 as per the document attached (page no. 41)
d on 1,054 per MMBTU. Now this is based on PKR 819 per MMBTU (for export oriented industry)

Insruance Premium per Year Insurance Cost per Year

30,000.00 30,000.00
15,000.00 15,000.00
15,000.00 15,000.00
15,000.00 15,000.00
15,000.00 15,000.00
15,000.00 15,000.00
15,000.00 15,000.00
10,000.00 20,000.00
10,000.00 20,000.00
10,000.00 20,000.00
10,000.00 20,000.00
10,000.00 20,000.00
5,000.00 660,000.00
880,000.00
r Sizes (purchase and Sales), Frequency, CBM, Cost per Container etc.
Army Welfare Trust
Biodegradable Tableware Manufacturing Facility
Financial Model - Calculations

Exchange and Inflation Rate

Exchange / Inflation Rate 1 2
Inflation Rate 0% 7%
Rupee Devaluation 0% 3%
Increase in Labour Cost 0% 10%
Exchange Rate (USD / PKR) 165.00 169.95

Production and Sales Plan

Production Plan - Plant Capacity and Capacity Utilization 1 2
Production Capacity (No. of Units per Year) 127,542,857 127,542,857
Production Capacity Utilization (% of Total Production Capacity) 100% 100%
Total No. of Units Produced 127,542,857 127,542,857

Inventory Movements 1 2
Opening Inventory - 10,628,571
Production During the Year 127,542,857 127,542,857
No. of Units Sold During the Year 116,914,286 126,657,143
Inventory Held 10,628,571 11,514,286

Product Costing
Raw Material - Pulp 1 2
Landed Cost - Per Tonn (USD) 900 900
Port Clearing Charges - Per Tonn (USD) 45 45
Transportation Cost - Per Tonn (PKR) 1,200 1,284
Transportation Cost - Per Tonn (USD) 7 8
Total Cost - Per Tonn (USD) 952 953
Total Cost - Per Gram (USD) 0.000952 0.000953
Cost per Unit of Product 0.020298 0.020304

Raw Material - Water Repellent 1 2

Landed Cost - Per Tonn (USD) 1,000 1,000
Port Clearing Charges - Per Tonn (USD) 50 50
Transportation Cost - Per Tonn (PKR) 1,200 1,284
Transportation Cost - Per Tonn (USD) 7 8
Total Cost - Per Tonn (USD) 1,057 1,058
Total Cost - Per Gram (USD) 0.001057 0.001058
Cost per Unit of Product 0.000845 0.000845
Raw Material - Oil Repellent 1 2
Landed Cost - Per Tonn (USD) 1,000 1,000
Port Clearing Charges - Per Tonn (USD) 50 50
Transportation Cost - Per Tonn (PKR) 1,200 1,284
Transportation Cost - Per Tonn (USD) 7 8
Total Cost - Per Tonn (USD) 1,057 1,058
Total Cost - Per Gram (USD) 0.001057 0.001058
Cost per Unit of Product 0.000225 0.000225

Labour Cost 1 2
Labour Cost per Hour per Labour (PKR) 110 121
Labour Cost per Hour per Labour (USD) 0.6672 0.7125
No. of Labours per Shift 38 38
Total Labour Cost per Hour (USD) 25.35 27.07

Electricity 1 2
Consumption Per Hour (KW) 320 320
Cost per Unit (PKR / KW) 21.43 22.93
Cost per Unit (USD /KW) 0.1299 0.1349
Electricity Cost per Hour (USD) 41.5612 43.1752

Gas 1 2
Consumption Per Hour (Cubic Meter) 160 160
Cost per Unit (PKR / Cubic Meter) 28.98 31.01
Cost per Unit (USD / Cubic Meter) 0.1756 0.1824
Gas Cost per Hour (USD) 28.0990 29.1902

Water 1 2
Consumption Per Hour (Cubic Meter) 160 160
Cost per Unit (PKR / Cubic Meter) 28.98 31.01
Cost per Unit (USD / Cubic Meter) 0.1756 0.1824
Water Cost per Hour (USD) 28.0990 29.1902

Product Cost 1 2
Total Raw Material Cost 2,725,353.90 2,726,158.20
Total Other Input Costs (Electricity, Gas and Water) 727,328.86 755,574.64
Total Production Cost 3,452,682.77 3,481,732.84
Production Cost per Unit 0.0271 0.0273

Sales and Cost of Goods Sold

Product Cost 1 2
Sales During the year
Sales 6,897,942.86 7,472,771.43
Cost of Goods Sold
Opening Inventory Sold During the Year - 287,723.56
Inventory Produced and Sold During the Year 3,164,959.20 3,167,409.74
Total Cost of Goods Sold During the Year 3,164,959.20 3,455,133.30

Expenses
Administrative Expenses 1 2
Salaries (PKR) 42,600,000.00 46,860,000.00
Health Insurance (PKR) 880,000.00 941,600.00
Utilities (PKR) 1,380,000.00 1,476,600.00
Carriage Outward / Transportation Expenses (PKR) 1,440,000.00 1,540,800.00
Fire and Safety Insurance 1,200,000.00 1,284,000.00
Total Administrative Expenses (PKR) 47,500,000.00 52,103,000.00
Total Administrative Expenses (USD) 287,878.79 306,578.41

Advertising and Marketing Expenses 1 2

Advertising and Business Development Expneses (USD) 34,489.71 37,363.86

Repair and Maintenance Expenses 1 2

Day to Day Repair and Maintenance (USD) 15,500.00 16,585.00
Major / Periodic Repair and Maintenance Expenses
Building Facilities Repair and Maintenance Expenses
Total Repair and Maintenance Expenses 15,500.00 16,585.00

Working Capital Calculations (Current Assets - Current Liabilities) 1 2

Finished Goods Inventory 287,723.56 314,323.10
Inventory - Raw Materials 485,337.00 485,480.23
Accounts Receivables 566,954.21 614,200.39
Accounts Payables 184,724.68 184,779.20
Accrued Liabilities 84,600.64 88,512.75
Net Working Capital Requirements 1,070,689.45 1,140,711.77
 3 4 5 6 7 8
7% 7% 7% 7% 7% 7%
3% 3% 3% 3% 3% 3%
10% 10% 10% 10% 10% 10%
175.05 180.30 185.71 191.28 197.02 202.93

3 4 5 6 7 8
127,542,857 127,542,857 127,542,857 127,542,857 127,542,857 127,542,857
100% 100% 100% 100% 100% 100%
127,542,857 127,542,857 127,542,857 127,542,857 127,542,857 127,542,857

3 4 5 6 7 8
11,514,286 11,588,095 11,594,246 11,594,759 11,594,801 11,594,805
127,542,857 127,542,857 127,542,857 127,542,857 127,542,857 127,542,857
127,469,048 127,536,706 127,542,345 127,542,814 127,542,854 127,542,857
11,588,095 11,594,246 11,594,759 11,594,801 11,594,805 11,594,805

3 4 5 6 7 8
900 900 900 900 900 900
45 45 45 45 45 45
1,374 1,470 1,573 1,683 1,801 1,927
8 8 8 9 9 9
953 953 953 954 954 954
0.000953 0.000953 0.000953 0.000954 0.000954 0.000954
0.020310 0.020316 0.020323 0.020330 0.020338 0.020345

3 4 5 6 7 8
1,000 1,000 1,000 1,000 1,000 1,000
50 50 50 50 50 50
1,374 1,470 1,573 1,683 1,801 1,927
8 8 8 9 9 9
1,058 1,058 1,058 1,059 1,059 1,059
0.001058 0.001058 0.001058 0.001059 0.001059 0.001059
0.000846 0.000846 0.000846 0.000846 0.000847 0.000847
 3 4 5 6 7 8
1,000 1,000 1,000 1,000 1,000 1,000
50 50 50 50 50 50
1,374 1,470 1,573 1,683 1,801 1,927
8 8 8 9 9 9
1,058 1,058 1,058 1,059 1,059 1,059
0.001058 0.001058 0.001058 0.001059 0.001059 0.001059
0.000225 0.000226 0.000226 0.000226 0.000226 0.000226

3 4 5 6 7 8
133 147 161 177 195 215
0.7609 0.8126 0.8679 0.9268 0.9898 1.0571
38 38 38 38 38 38
28.91 30.88 32.98 35.22 37.61 40.17

3 4 5 6 7 8
320 320 320 320 320 320
24.54 26.25 28.09 30.06 32.16 34.41
0.1402 0.1456 0.1513 0.1571 0.1632 0.1696
44.8519 46.5938 48.4032 50.2830 52.2357 54.2643

3 4 5 6 7 8
160 160 160 160 160 160
33.18 35.50 37.98 40.64 43.49 46.53
0.1895 0.1969 0.2045 0.2125 0.2207 0.2293
30.3238 31.5015 32.7248 33.9957 35.3159 36.6874

3 4 5 6 7 8
160 160 160 160 160 160
33.18 35.50 37.98 40.64 43.49 46.53
0.1895 0.1969 0.2045 0.2125 0.2207 0.2293
30.3238 31.5015 32.7248 33.9957 35.3159 36.6874

3 4 5 6 7 8
2,726,993.73 2,727,861.71 2,728,763.39 2,729,700.10 2,730,673.18 2,731,684.04
784,917.35 815,399.58 847,065.58 879,961.33 914,134.59 949,634.96
3,511,911.08 3,543,261.28 3,575,828.97 3,609,661.43 3,644,807.76 3,681,319.00
0.0275 0.0278 0.0280 0.0283 0.0286 0.0289

3 4 5 6 7 8

7,520,673.81 7,524,665.67 7,524,998.33 7,525,026.05 7,525,028.36 7,525,028.55

 314,323.10 319,079.88 322,099.13 325,074.05 328,150.93 331,346.15
3,192,831.20 3,221,162.16 3,250,754.92 3,281,510.50 3,313,461.61 3,346,653.64
3,507,154.30 3,540,242.04 3,572,854.05 3,606,584.55 3,641,612.54 3,677,999.79

3 4 5 6 7 8
51,546,000.00 56,700,600.00 62,370,660.00 68,607,726.00 75,468,498.60 83,015,348.46
1,007,512.00 1,078,037.84 1,153,500.49 1,234,245.52 1,320,642.71 1,413,087.70
1,579,962.00 1,690,559.34 1,808,898.49 1,935,521.39 2,071,007.89 2,215,978.44
1,648,656.00 1,764,061.92 1,887,546.25 2,019,674.49 2,161,051.71 2,312,325.33
1,373,880.00 1,470,051.60 1,572,955.21 1,683,062.08 1,800,876.42 1,926,937.77
57,156,010.00 62,703,310.70 68,793,560.45 75,480,229.48 82,822,077.32 90,883,677.69
326,515.28 347,772.19 370,437.50 394,605.51 420,376.88 447,859.07

3 4 5 6 7 8
37,603.37 37,623.33 37,624.99 37,625.13 37,625.14 37,625.14

3 4 5 6 7 8
17,745.95 18,988.17 20,317.34 21,739.55 23,261.32 24,889.61

17,745.95 18,988.17 20,317.34 21,739.55 23,261.32 24,889.61

3 4 5 6 7 8
319,079.88 322,099.13 325,074.05 328,150.93 331,346.15 334,665.36
485,629.02 485,783.59 485,944.17 486,110.98 486,284.26 486,464.28
618,137.57 618,465.67 618,493.01 618,495.29 618,495.48 618,495.50
184,835.83 184,894.66 184,955.78 185,019.27 185,085.22 185,153.74
92,619.39 96,930.98 101,458.59 106,213.90 111,209.29 116,457.84
1,145,391.26 1,144,522.75 1,143,096.87 1,141,524.03 1,139,831.39 1,138,013.57
 9 10
7% 7%
3% 3%
10% 10%
209.02 215.29

9 10
127,542,857 127,542,857
100% 100%
127,542,857 127,542,857

9 10
11,594,805 11,594,805
127,542,857 127,542,857
127,542,857 127,542,857
11,594,805 11,594,805

9 10
900 900
45 45
2,062 2,206
10 10
955 955
0.000955 0.000955
0.020353 0.020361

9 10
1,000 1,000
50 50
2,062 2,206
10 10
1,060 1,060
0.001060 0.001060
0.000847 0.000847
 9 10
1,000 1,000
50 50
2,062 2,206
10 10
1,060 1,060
0.001060 0.001060
0.000226 0.000226

9 10
236 260
1.1289 1.2057
38 38
42.90 45.82

9 10
320 320
36.82 39.40
0.1762 0.1830
56.3716 58.5608

9 10
160 160
49.79 53.27
0.2382 0.2475
38.1122 39.5922

9 10
160 160
49.79 53.27
0.2382 0.2475
38.1122 39.5922

9 10
2,732,734.17 2,733,825.08
986,513.99 1,024,825.21
3,719,248.16 3,758,650.29
0.0292 0.0295

9 10

7,525,028.57 7,525,028.57
 334,665.36 338,113.47
3,381,134.69 3,416,954.81
3,715,800.05 3,755,068.27

9 10
91,316,883.31 100,448,571.64
1,512,003.84 1,617,844.11
2,371,096.93 2,537,073.71
2,474,188.10 2,647,381.27
2,061,823.42 2,206,151.05
99,735,995.59 109,457,021.78
477,166.76 508,422.38

9 10
37,625.14 37,625.14

9 10
26,631.89 28,496.12

26,631.89 28,496.12

9 10
338,113.47 341,695.48
486,651.29 486,845.56
618,495.50 618,495.50
185,224.92 185,298.86
121,973.40 127,770.63
1,136,061.95 1,133,967.05
Army Welfare Trust
Biodegradable Tableware Manufacturing Facility
Financial Model - Financial Statements
Balance Sheet Check OK OK OK

Income Statement
Year 0 1 2
Sales Revenue 6,897,942.86 7,472,771.43
Cost of Goods Sold 3,164,959.20 3,455,133.30
Gross Profit - 3,732,983.65 4,017,638.12
Administrative Expenses 287,878.79 306,578.41
Advertising and Marketing Expenses 34,489.71 37,363.86
Repair and Maintenance Expenses 15,500.00 16,585.00
Depreciation Expense 124,188.82 124,188.82
Finance Lease Expenses 8,844.94 8,303.12
Profit Before Interest and Tax (PBIT) - 3,262,081.40 3,524,618.92
Interest Expense 283,372.91 214,580.36
Profit Before Tax (PBT) - 2,978,708.49 3,310,038.57
Tax Expense 863,825.46 959,911.18
Net Profit / Loss for the Year - 2,114,883.03 2,350,127.38

Balance Sheet
Year 0 1 2
Non-Current Assets
Plant and Machinery 2,283,582.00 2,180,820.81 2,078,059.62
Building 487,963.47 468,444.93 448,926.39
Furniture, Fixtures and Equipment 21,212.12 19,303.03 17,393.94
Right of Use Asset (Land) 84,237.48 84,237.48 84,237.48
Total Non-Current Assets 2,876,995.07 2,752,806.25 2,628,617.43

Current Assets
Cash and Bank 1,809,640.63 3,501,031.04
Inventory 773,060.56 799,803.33
Accounts Receivables 566,954.21 614,200.39
Deposits
Deferred Tax Asset
Investment in Working Capital 1,284,827.34 899,557.92 472,773.31
Total Current Assets 1,284,827.34 4,049,213.32 5,387,808.08
Total Assets 4,161,822.41 6,802,019.57 8,016,425.51

Equity
Share Capital Contribution 1,223,275.48 1,223,275.48 1,223,275.48
Retained Earnings - 2,114,883.03 4,465,010.41
Total Equity 1,223,275.48 3,338,158.50 5,688,285.89
Non-Current Liabilities
Working Capital Financing - Loan 1 1,284,827.34 899,557.92 472,773.31
PPE Financing - Loan 2 1,569,482.11 2,215,900.51 1,508,699.01
Finance Lease Liability 84,237.48 79,077.32 73,375.34
Total Non-Current Liabilities 2,938,546.93 3,194,535.75 2,054,847.67

Current Liabilities
Accounts Payable 184,724.68 184,779.20
Accrued Liabilities 84,600.64 88,512.75
Interest Payable
Income Tax Liability
Deferred Tax Liability
Total Current Liabilities - 269,325.32 273,291.95
Total Liabilities 2,938,546.93 3,463,861.07 2,328,139.62
Total Equity and Liabilities 4,161,822.41 6,802,019.57 8,016,425.51
Error Check - - -

Statement of Cashflows
Year 0 1 2
Cashflow from Operating Activities
Net Profit for the Year - 2,114,883.03 2,350,127.38
Depreciation Expenses 124,188.82 124,188.82
Increase / Decrease in Accounts Receivables - 566,954.21 - 47,246.18
Increase / Decrease in Inventory - 773,060.56 - 26,742.77
Increase / Decrease in Accounts Payables 184,724.68 54.52
Increase / Decrease in Accrued Liabiliities 84,600.64 3,912.12
Working Capital Investment 1,284,827.34
Cashflow from Operating Activities 1,284,827.34 1,168,382.40 2,404,293.88

Cashflow from Investing Activities

Investment in Property, Plant and Equipment - 2,792,757.59
Working Capital Investment - 1,284,827.34
Cashflow from Investing Activities - 4,077,584.93 - -

Cashflow from Financing Activities

Equity Contribution 1,223,275.48
Financing Obtained 2,854,309.45
Loan Repayments - 638,408.94 - 707,201.49
Finance Lease Liability Payments - 5,160.16 - 5,701.98
Cashflow from Financing Activities 4,077,584.93 - 643,569.10 - 712,903.47
Net Cashflow for the Year 1,284,827.34 524,813.29 1,691,390.41
Opening Cash and Bank Balances 1,284,827.34 1,809,640.63
Closing Cash and Bank Balances 1,284,827.34 1,809,640.63 3,501,031.04
 OK OK OK OK OK

3 4 5 6 7
7,520,673.81 7,524,665.67 7,524,998.33 7,525,026.05 7,525,028.36
3,507,154.30 3,540,242.04 3,572,854.05 3,606,584.55 3,641,612.54
4,013,519.51 3,984,423.63 3,952,144.28 3,918,441.50 3,883,415.82
326,515.28 347,772.19 370,437.50 394,605.51 420,376.88
37,603.37 37,623.33 37,624.99 37,625.13 37,625.14
17,745.95 18,988.17 20,317.34 21,739.55 23,261.32
124,188.82 124,188.82 124,188.82 124,188.82 124,188.82
7,704.41 7,042.84 6,311.80 5,504.01 4,611.39
3,499,761.68 3,448,808.29 3,393,263.83 3,334,778.48 3,273,352.27
138,374.97 67,353.93 30,274.33 - -
3,361,386.71 3,381,454.36 3,362,989.50 3,334,778.48 3,273,352.27
974,802.14 980,621.76 975,266.96 967,085.76 949,272.16
2,386,584.56 2,400,832.59 2,387,722.55 2,367,692.72 2,324,080.11

3 4 5 6 7

1,975,298.43 1,872,537.24 1,769,776.05 1,667,014.86 1,564,253.67

429,407.85 409,889.31 390,370.77 370,852.23 351,333.70
15,484.85 13,575.76 11,666.67 9,757.58 7,848.48
84,237.48 84,237.48 84,237.48 84,237.48 84,237.48
2,504,428.61 2,380,239.79 2,256,050.97 2,131,862.15 2,007,673.33

5,217,417.37 7,392,238.76 9,516,696.85 12,001,650.14 14,442,218.00

804,708.90 807,882.72 811,018.22 814,261.90 817,630.42
618,137.57 618,465.67 618,493.01 618,495.29 618,495.48

- 0.00 - 0.00 - 0.00

6,640,263.84 8,818,587.16 10,946,208.08 13,434,407.34 15,878,343.90
9,144,692.46 11,198,826.95 13,202,259.06 15,566,269.49 17,886,017.23

1,223,275.48 1,223,275.48 1,223,275.48 1,223,275.48 1,223,275.48

6,851,594.97 9,252,427.57 11,640,150.11 14,007,842.84 16,331,922.95
8,074,870.45 10,475,703.04 12,863,425.59 15,231,118.31 17,555,198.42
- 0.00 - 0.00 - 0.00 - -
725,292.14 381,185.87 - 0.00 - -
67,074.65 60,112.39 52,419.10 43,918.00 34,524.30
792,366.79 441,298.26 52,419.10 43,918.00 34,524.30

184,835.83 184,894.66 184,955.78 185,019.27 185,085.22

92,619.39 96,930.98 101,458.59 106,213.90 111,209.29

277,455.22 281,825.64 286,414.37 291,233.17 296,294.51

1,069,822.01 723,123.90 338,833.46 335,151.17 330,818.81
9,144,692.46 11,198,826.95 13,202,259.06 15,566,269.49 17,886,017.23
- - - - -

3 4 5 6 7

2,386,584.56 2,400,832.59 2,387,722.55 2,367,692.72 2,324,080.11

124,188.82 124,188.82 124,188.82 124,188.82 124,188.82
- 3,937.18 - 328.10 - 27.34 - 2.28 - 0.19
- 4,905.57 - 3,173.82 - 3,135.50 - 3,243.68 - 3,368.51
56.63 58.83 61.12 63.49 65.96
4,106.63 4,311.59 4,527.61 4,755.31 4,995.39

2,506,093.89 2,525,889.93 2,513,337.25 2,493,454.38 2,449,961.57

- - - - -

- 783,406.88 - 344,106.27 - 381,185.87

- 6,300.69 - 6,962.26 - 7,693.30 - 8,501.09 - 9,393.71
- 789,707.56 - 351,068.53 - 388,879.17 - 8,501.09 - 9,393.71
1,716,386.33 2,174,821.40 2,124,458.08 2,484,953.29 2,440,567.86
3,501,031.04 5,217,417.37 7,392,238.76 9,516,696.85 12,001,650.14
5,217,417.37 7,392,238.76 9,516,696.85 12,001,650.14 14,442,218.00
 OK OK OK

8 9 10
7,525,028.55 7,525,028.57 7,525,028.57
3,677,999.79 3,715,800.05 3,755,068.27
3,847,028.76 3,809,228.52 3,769,960.30
447,859.07 477,166.76 508,422.38
37,625.14 37,625.14 37,625.14
24,889.61 26,631.89 28,496.12
124,188.82 124,188.82 124,188.82
3,625.05 2,535.15 1,330.80
3,208,841.07 3,141,080.76 3,069,897.03
- - -
3,208,841.07 3,141,080.76 3,069,897.03
930,563.91 910,913.42 890,270.14
2,278,277.16 2,230,167.34 2,179,626.89

8 9 10

1,461,492.48 1,358,731.29 1,255,970.10

331,815.16 312,296.62 292,778.08
5,939.39 4,030.30 2,121.21
84,237.48 84,237.48 84,237.48
1,883,484.51 1,759,295.69 1,635,106.87

16,836,121.75 19,180,959.58 21,474,195.89

821,129.65 824,764.76 828,541.04
618,495.50 618,495.50 618,495.50

18,275,746.89 20,624,219.84 22,921,232.43

20,159,231.40 22,383,515.53 24,556,339.31

1,223,275.48 1,223,275.48 1,223,275.48

18,610,200.10 20,840,367.44 23,019,994.34
19,833,475.58 22,063,642.92 24,243,269.81
 - - -
- - -
24,144.25 12,674.30 -
24,144.25 12,674.30 -

185,153.74 185,224.92 185,298.86

116,457.84 121,973.40 127,770.63

301,611.58 307,198.31 313,069.49

325,755.82 319,872.61 313,069.49
20,159,231.40 22,383,515.53 24,556,339.31
- - -

8 9 10

2,278,277.16 2,230,167.34 2,179,626.89

124,188.82 124,188.82 124,188.82
- 0.02 - 0.00 - 0.00
- 3,499.23 - 3,635.11 - 3,776.28
68.52 71.18 73.94
5,248.55 5,515.56 5,797.24

2,404,283.79 2,356,307.78 2,305,910.61

- - -

- 10,380.05 - 11,469.95 - 12,674.30

- 10,380.05 - 11,469.95 - 12,674.30
2,393,903.75 2,344,837.83 2,293,236.31
14,442,218.00 16,836,121.75 19,180,959.58
16,836,121.75 19,180,959.58 21,474,195.89
Army Welfare Trust
Biodegradable Tableware Manufacturing Facility
Financial Model - Supporting Schedules

Investment in Property, Plant and Equipment

Property, Plant and Equipment Cost Useful Life

Plant and Machinery 2,283,582.00 20.00
Building 487,963.47 20.00
Furniture, Fixtures and Equipment 21,212.12 10.00
Total 2,792,757.59

Fixed Assets Schedule

Financing and Capital Structure

Investment Requirement Amount
Investment in Property, Plant and Equipment 2,792,757.59
Net Working Capital Requirement (Year 1) 1,070,689.45
Cash Balance Required (% of Net WC) 20%
Total Working Capital Requirement 1,284,827.34
Total Investment 4,077,584.93

Capital Structure % Amount

Debt 70% 2,854,309.45
Equity 30% 1,223,275.48

Loan Parameter Loan 1 - WC Loan 2 - PPE

Loan Amount 1,284,827.34 1,569,482.11
Annual Interest Rate 10.50% 10.50%
Loan Period In Years 3 5
Number of Payments per Year 2 2
Instalment Amount $ 255,160.83 $ 205,730.10
Grace Period (Years)

Loan 1 - Working Capital Financing 1

Payment No. 1 2
Instalment Amount $ 255,160.83 $ 255,160.83
Principal Component $ 187,707.39 $ 197,562.03
Interest Component $ 67,453.44 $ 57,598.80
Balance 1,097,119.95 899,557.92

Loan 2 - PPE Financing 1

Payment No. 1 2
Instalment Amount $ 205,730.10 $ 205,730.10
Principal Component $ 123,332.29 $ 129,807.23
Interest Component $ 82,397.81 $ 75,922.87
Balance $ 1,446,149.82 $ 1,316,342.59

Consolidated Amortization Schedule 1

Payment No. 1 2
Instalment Amount $ 460,890.92 $ 460,890.92
Principal Component $ 311,039.68 $ 327,369.26
Interest Component $ 149,851.25 $ 133,521.66
Balance $ 2,543,269.77 $ 2,215,900.51

Land Lease Amortization Schedule

Value of Asset as of Today (PV) - PKR 84,237.48
Cost of Debt 10.5%
Lease Term (Years) 10
No. of Payments per Year 1
Instalment Amount 14,005.10

Finance Lease Amortization Schedule - PKR 1 2

Payment No. 1 2
Instalment Amount 14,005.10 14,005.10
Principal Payment 5,160.16 5,701.98
Interest Payment 8,844.94 8,303.12
Balance 79,077.32 73,375.34

Cost of Capital Calculations

Cost of Equity Calculations %
Risk Free Rate of Return (10 Year Govt. Bond) 9.64%
Market Return (Average Returns of KSE-100 for 10 Years) 19.10%
Weighted Average Asset Beta of Pulp and Board Industry 0.81
Average (Debt / Equity Ratio) 0.068512903282
Tax Rate 29%
Project Equity Beta 0.85
Cost of Equity 17.30%

Cost of Equity Calculations %

Interest Rate 10.50%
Tax Rate 29%
Cost of Debt 7.46%

Cost of Equity Calculations %

WACC 17%
 Depreciable Depreciation
Residual Value Value (USD) Method
10% 2,055,223.80 SLM
20% 390,370.77 SLM
10% 19,090.91 SLM
2,464,685.48

2 3 4
3 4 5 6 7
$ 255,160.83 $ 255,160.83 $ 255,160.83 $ 255,160.83 $ -
$ 207,934.03 $ 218,850.57 $ 230,340.23 $ 242,433.09 $ -
$ 47,226.79 $ 36,310.25 $ 24,820.60 $ 12,727.74 $ -
691,623.89 472,773.31 242,433.09 - -

2 3 4
3 4 5 6 7
$ 205,730.10 $ 205,730.10 $ 205,730.10 $ 205,730.10 $ 205,730.10
$ 136,622.11 $ 143,794.77 $ 151,344.00 $ 159,289.56 $ 167,652.26
$ 69,107.99 $ 61,935.32 $ 54,386.10 $ 46,440.54 $ 38,077.84
$ 1,179,720.47 $ 1,035,925.70 $ 884,581.70 $ 725,292.14 $ 557,639.88

2 3 4
3 4 5 6 7
$ 460,890.92 $ 460,890.92 $ 460,890.92 $ 460,890.92 $ 205,730.10
$ 344,556.15 $ 362,645.35 $ 381,684.23 $ 401,722.65 $ 167,652.26
$ 116,334.78 $ 98,245.58 $ 79,206.70 $ 59,168.28 $ 38,077.84
$ 1,871,344.36 $ 1,508,699.01 $ 1,127,014.79 $ 725,292.14 $ 557,639.88

3 4 5 6 7
3 4 5 6 7
14,005.10 14,005.10 14,005.10 14,005.10 14,005.10
6,300.69 6,962.26 7,693.30 8,501.09 9,393.71
7,704.41 7,042.84 6,311.80 5,504.01 4,611.39
67,074.65 60,112.39 52,419.10 43,918.00 34,524.30

If interest rates are different on WC financing and PPE financing, the cost of debt calculations shall change accordingly.
Similarly, changes in tax rate (e.g. EPZ rates in first 5 years) will affect cost of debt calculations.
Average D/E ratio may not be acceptable for bank.
D/E ratio for Beta Calculation (Total Liabilities or Interest Bearing Liabilities)? Because non-interest bearing liabilities still ch
D/E Ratio for WACC (Total Liabiliities or Interest Bearing Liabilities) i.e. no tax benefit on non-interest bearing liabilities
Optimal D/E Ratio Calculations Needed.
4 5
8 9 10
$ - $ - $ -
$ - $ - $ -
$ - $ - $ -
- - -

4 5
8 9 10
$ 205,730.10 $ 205,730.10 $ 205,730.10
$ 176,454.01 $ 185,717.84 $ 195,468.03
$ 29,276.09 $ 20,012.26 $ 10,262.07
 $ 381,185.87 $ 195,468.03 $ -

4 5
8 9 10
$ 205,730.10 $ 205,730.10 $ 205,730.10
$ 176,454.01 $ 185,717.84 $ 195,468.03
$ 29,276.09 $ 20,012.26 $ 10,262.07
$ 381,185.87 $ 195,468.03 -

8 9 10
8 9 10
14,005.10 14,005.10 14,005.10
10,380.05 11,469.95 12,674.30
3,625.05 2,535.15 1,330.80
24,144.25 12,674.30 -

ulations shall change accordingly.

non-interest bearing liabilities still change the leverage or credit risk profile of the company.
on non-interest bearing liabilities
Army Welfare Trust
Biodegradable Tableware Manufacturing Facility
Financial Model - Assumptions

Parameter Tax Rate (%) KIBOR Premiums

Scenario 1 29% 7.50% 2.00%
Scenario 1 0% 3% 2.50%
Scenario 1 0% 6% 3.00%

Key Parameters Options

No. of Shifts 3
Working Days per Year 310
Efficiency 90%
Tax Rate (Year 1 to Year 5) 29%
Tax Rate (Year 6 and Onwards) 29%
KIBOR - PPE 7.50%
Risk Premium - PPE 3.00%
KIBOR - WC 7.50%
Risk Premium - WC 3.00%

Net Cashflow for the Year 0 1 2

Net Cashflow - 4,077,584.93 1,809,640.63 3,501,031.04
Discounted Net Cashflows @ Ke - 4,077,584.93 1,542,711.44 2,544,372.45
Cummulative Net Cashflows - 4,077,584.93 - 2,267,944.29 1,233,086.74
Cummulative Discounted Net Cashflows - 4,077,584.93 - 2,534,873.48 9,498.97
Partial Years - Payback Period 0.65
Partial Years - Discounted Payback Period 1.00

Investment Returns %/$

Payback Period 1.6
Discounted Payback Period 2.0
Net Present Value - FCFE 34,375,386
Working Days Efficiency Shifts
310 85% 2.00
320 90% 2.50
330 95% 3.00

3 4 5 6 7 8
5,217,417.37 7,392,238.76 9,516,696.85 12,001,650.14 14,442,218.00 16,836,121.75
3,232,456.32 3,904,320.24 4,284,972.55 4,606,755.18 4,725,855.39 4,696,571.64
6,450,504.11 13,842,742.87 23,359,439.72 35,361,089.86 49,803,307.86 66,639,429.61
3,241,955.28 7,146,275.53 11,431,248.07 16,038,003.25 20,763,858.64 25,460,430.27
0.24 0.87 1.45 1.95 2.45 2.96
0.00 0.83 1.67 2.48 3.39 4.42
 9 10
19,180,959.58 21,474,195.89
4,561,435.99 4,353,519.83
85,820,389.19 107,294,585.08
30,021,866.27 34,375,386.10
3.47 4.00
5.58 6.90