Economics of Layer Farming
START
TECHNO ECONOMIC ASSUMPTIONS
DETAILS OF INVESTMENT
INCOME - EXPENDITURE STATEMENT
PROFIT AND LOSS STATEMENT
REPAYMENT SCHEDULE
CASH FLOW STATEMENT
FINANCIAL ANALYSIS OF THE PROJECT
Developed by
Dr. A. Mohamed Safiullah
Dr. N.Prema
Department of Animal Husbandry Economics
Veterinary College and Research Institute
Namakkal
bandry Economics
esearch Institute
 Layer project for 1,00,000 birds Technical Assumptions
1 No. of birds in lay 100,000
2 Rearing period (weeks) 72
Brooding cum growing period (weeks) 20
Laying period (weeks) 52
3 No. of batches 3
4 Space requirement per bird (s.ft.)
Brooder cum grower period 1
Layer period 0.8
5 Cost of construction (Rs./s.ft.)
Brooder cum grower shed 65
Layer shed 70
6 Store room (s.ft.) 100
7 Cost of construction of store room (Rs./s.ft) 90
Water facility (Rs) 10000
8 Equipment cost (Rs./bird)
Brooder cum grower house 7
Layer house - cages 35
9 Mortality (%)
Brooding cum growing stage 6
Laying stage 7
10 Cost of DOCs (Rs./chick) 14.1
11 Supply of free chicks (%) 3
12 Extra chicks purchased (%) 3
13 Feed requirement (Kg./bird)
Brooding cum growing stage 7
Laying stage 38
14 Feed cost (Rs./kg.)
Chick/grower mash 7
Layer mash 6.7
15 Labour cost 0
16 Over heads cost (Cost of litter, electricity,
medicines,
Brooding cumvaccine, insurance,
growing etc.)
stage (Rs./bird) 5.5
Laying stage (Rs./bird) 7
17

17 Egg production 295

18 Egg price (Rs./egg) 1.3
19 Average body wt. Of culled birds (Kg.) 1.5
20 Sale price of culled bird (Rs./bird) 38
21 Income from manure (Rs./bird)
Brooding cum growing stage 1.15
Laying stage 5.85
22 No. Of gunny bags per ton of feed 13.3
23 Income from gunny bags (Rs./bag) 6
24 Depreciation on sheds (%) 5
25 Depreciation on equipment (%) 10
26 Margin money (%) 25
27 Interest rate (%) 15
28 Repayment period (years) 8
29 Grace period (years) 1
30 Construction period (months) 3
31 Rest period (weeks)
Brooder cum grower house (weeks) 4
Layer house (weeks) 4
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Year Batch No. Grower house Laying House Weeks grow Weeks lay No. Of No. Of
weeks Number Weeks batches batches
introduced culled

I 1 13 -28 A 29- 52 20 20 1 -
2 33 -48 B 49- 52 20 0 1 -
40 20 2 0
II 1 A 01- 32 0 32 1
2 B 01- 52 0 52 1
3 1 -16 C 17- 52 20 32 1 -
4 21 -36 A 37- 52 20 12 1 -
5 41 -52 - - 12 - 1 -
52 128 3 2
III 3 C 01- 20 0 20 1
4 A 01- 40 0 40 1
5 1 -4 B 05- 52 8 44
6 9 -24 C 25- 52 20 24 1
7 29 -44 A 45- 52 20 4 1
8 49 -52 - - 52 4 0 1
52 132 3 2
IV 5 B 01- 8 0 8 1
6 C 01- 28 0 28 1
7 A 01- 48 0 48 1
8 1 -12 B 13- 52 16 36
9 17 -32 C 33- 52 20 16 1
10 37 -52 - - 16 1
52 136 2 3
V 8 B 01- 16 0 16 1
9 C 01- 36 0 36 1
10 A 01- 52 4 48
11 5 -20 B 21- 52 20 28 1
12 25 -40 C 41- 52 20 8 1
13 45 -52 - - 8 1
52 136 3 2
VI 10 A 01- 4 0 4 1
11 B 01- 24 0 24 1
12 C 01- 44 0 44 1
13 1 -8 A 09- 52 12 40
14 13 -28 B 29- 52 20 20 1
15 33 -48 C 49- -52 20 0 1
52 132 2 3
VII 13 A 01- 12 0 12 1
14 B 01- 32 0 32 1
15 C 01- 52 0 52 1
16 1 -16 A 17- 52 20 32 1
17 21 -36 B 37- 52 20 12 1
18 41 -52 - - 12 - 1
52 140 3 3
VIII 16 A 01- 20 0 20 1
17 B 01- 40 0 40 1
18 1 -4 C 05- 52 8 44
19 9 -24 A 25- 52 20 24 1
20 29 -44 B 45- 52 20 4 1
21 49 -52 - - 4 0 1
52 132 3 2
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FINANCIAL ANALYSIS OF THE PROJECT

Particulars I year II year III year IV year V year VI year VII year
Capital Investment 13938000
Working Capital 7730930 27400772 28088531 28291049 28793589 27659817 29494600
Total Cost 21668930 27400772 28088531 28291049 28793589 27659817 29494600
Total Benefit 4772462 32325692 33258005 35364077 34190318 34431764 36296389
Net Cash Flow -16896467 4924921 5169474 7073028 5396728 6771948 6801789
DCF at 20% 0.833 0.694 0.579 0.482 0.402 0.335 0.279
Disc. Benefit 3977052 22448397 19246531 17054435 13740322 11531128 10129656
Disc.cost 18057441 19028314 16254937 13643446 11571498 9263217 8231402
NPV at 20% DCF -14080389 3420084 2991594 3410990 2168824 2267912 1898255
DCF at 25% 0.800 0.640 0.512 0.410 0.328 0.262 0.210
Disc. Benefit 3817970 20688443 17028099 14485126 11203483 9026080 7611905
Disc.cost 17335144 17536494 14381328 11588014 9435083 7250855 6185466
NVP at 25% DCV -13517174 3151949 2646771 2897112 1768400 1775225 1426439

NPV at 20% 4509016 B:C ratio at 20% 1.044 :1

NPV at 25% 1902960 B:C ratio at 25% 1.022 :1

IRR 30%

Dr. A. Md. Safiullah & Dr. N.Prema Dept. of AH Economics, VC & RI, Namakkal.
VIII year

28175978
28175978
38632048
10456070
0.233
8984580
6552832
2431748
0.168
6481382
4727145
1754238
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CASH FLOW STATEMENT

Particulars I year II year III year IV year V year VI year

Cash Infow
Sale of Eggs 4556039 29158650 30069857 30981065 30981065 30069857
Sale of culled birds 0 2347518 2347518 3521278 2347518 3521278
Sale of manure 76391 99308 99308 99308 99308 99308
Laying
-Growingstage
stage 69499 444793 458693 472593 472593 458693
Sale of gunny bags 70534 275423 282629 289834 289834 282629
Depreciated value of
Sheds
Equipments
Value of closing
Total
stockCash Inflow 4772462 32325692 33258005 35364077 34190318 34431764
Cash Outflow
Cost of chicks 968,200 1,452,300 1,452,300 968,200 1,452,300 968,200
Cost of feed Growing 3462667 4501467 4501467 4501467 4501467 4501467
Laying Stage
stage 3252352 20815051 21465522 22115992 22115992 21465522
Misc. Expenses
Growing stage 377,667 490,967 490,967 490,967 490,967 490,967
Laying stage 83161 532231 548863 565495 565495 548863
Total Cash Outflow 8144046 27792016 28459118 28642121 29126221 27975018
Net Cash Inflow -3371584 4533677 4798887 6721956 5064097 6456746

Dr. A. Md. Safiullah & Dr. N.Prema Dept. of AH Economics, VC & RI Namakkal.
VII year VII year

31892273 30069857
3521278 2347518
99308 99308
486492 458693
297039 282629

5158536
104747
110,760
36296389 38632048

1,452,300 1,452,300
4501467 4501467
22766463 21465522

490,967 490,967
582128 548863
29793323 28459118
6503066 10172930
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PROFIT AND LOSS STATEMENT

Particulars I year II year III year IV year V year VI year VII year VIII year
Expenditure
Total Expenditure 10234746 29882716 30251147 30135478 30320907 28871033 30390666 28757790
Net Expenditure (TE- 7730930 27400772 28088531 28291049 28793589 27659817 29494600 28175978

Income
Total Income (TI) 4772462 32325692 33258005 35364077 34190318 34431764 36296389 38632048
Net Income (TI-NE) -2958467 4924921 5169474 7073028 5396728 6771948 6801789 10456070

REPAYMENT SCHEDULE
Year Profit Open Instalment Interest Total Surplus
Balance Debit
I -2958467 13938000 0 2090700 2090700 -5049167
II 4924921 13938000 1991143 2090700 4081843 843078
III 5169474 11946857 1991143 1792029 3783171 1386302
IV 7073028 9955714 1991143 1493357 3484500 3588528
V 5396728 7964571 1991143 1194686 3185829 2210900
VI 6771948 5973429 1991143 896014 2887157 3884790
VII 6801789 3982286 1991143 597343 2588486 4213304
VIII 10456070 1991143 1991143 298671 2289814 8166256

Dr. A. Md. Safiuula & Dr. N.Prema Dept. of AH Economics, VC & RI, Namakkal.
 INCOME-EXPENDITURE STATEMENT

Particulars I year II year III year IV year V year VI year VII year VII year
Income
Sale of Eggs 4556039 29158650 30069857 30981065 30981065 30069857 31892273 30069857
Sale of culled birds 0 2347518 2347518 3521278 2347518 3521278 3521278 2347518
Sale of manure
-Growing stage 76391 99308 99308 99308 99308 99308 99308 99308
Laying stage 69499 444793 458693 472593 472593 458693 486492 458693
Sale of gunny bags 70534 275423 282629 289834 289834 282629 297039 282629
Depreciated value of

Sheds 5158536
Equipments 104747
Value of closing
stock 110,760
Total Income 4772462 32325692 33258005 35364077 34190318 34431764 36296389 38632048
Expenditutre
Cost of chicks 968,200 1,452,300 1,452,300 968,200 1,452,300 968,200 1,452,300 1,452,300
Cost of feed
Growing stage 3462667 4501467 4501467 4501467 4501467 4501467 4501467 4501467
Laying Stage 3252352 20815051 21465522 22115992 22115992 21465522 22766463 21465522
Misc. Expenses
Growing stage 377,667 490,967 490,967 490,967 490,967 490,967 490,967 490,967
Laying stage 83161 532231 548863 565495 565495 548863 582128 548863
On interest 2090700 2090700 1792029 1493357 1194686 896014 597343 298671
Depreciation on
Sheds 388783 369344 350877 333333 316666 300833 285791 271502
Equipments 24333.33 21900 19710 17739 15965 14369 12932 11639
Total Expenditure ### 29882716 30251147 30135478 30320907 28871033 30390666 28757790

Dr. A. Md Safiullah & Dr. N.Prema Dept. of AH Economics, VC & RI, Namakkal.
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 DETAILS OF INVESTMENT
Sl.No Particulars (Rs.)

A FIXED INVESTMENT
1 Sheds and other stuctures
A) Brooder cum grower shed 2166666.66666667
B) Layer sheds 5600000
C) Store room 9000
2 Water supply system (Bore well, Electric
motor pumpset - 1 HP, water tank and
pipeline) 10000
3 Equipments
Brooding cum growing house 233333.333333333
Laying house 3500000
Total Fixed Cost 11519000

C VARIABLE COST
Capitalisation of recurring expenses for
first 3 batches
1 A) Chick cost 1452300
2 B) Feed cost 5047000
C) Overheads such as cost of eletricity,
3 medicines, vaccine, insurance, litter, etc. 566500
Total Variable Cost 7065800

GRAND TOTAL 18584800

Cost of Project
1 Loan From Bank 13938000
2 Margin amount from entrepreneur 4647000
Total cost of project 18585000

Dr. A. Md. Safiullah & Dr. N.Prema Dept. of AH Economics, VC & RI, Namakkal.
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