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PLANT DESIGN & ECONOMICS PROJECT

ETHYL BENZENE PRODUCTION PLANT
Submitted by
ADITYA NAVNAGE-BT19CME004
ALTI NITIN SAI KUMAR- BT19CME009
ANUMULA SAI KIRAN- BT19CME015
BALABHADRUNI KOUSHIK GUPTA- BT19CME023
CHAVARE VIKRAM GIRISH- BT19CME033
CHUNDURI PRANEETH- BT19CME035
DANDEKAR VIGNESH- BT19CME037
KARTIK PRASAD- BT19CME085
PRIYANGSHU MALAKAR- BT19CME089
SOURABH NANWANI- BT19CME103
PAMISETTY THARUN SAI- BT19CME119
Course Coordinator
Dr. Sachin Mandavgane,
Associate Professor, HOD
Department of Chemical Engineering, VNIT Nagpur

DEPARTMENT OF CHEMICAL ENGINEERING

VISVESVARAYA NATIONAL INSTITIUTE OF TECHNOLOGY NAGPUR
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ABSTRACT:
This report gives us the information regarding all the expenditure involved in the production
of ethyl benzene. All the information required for the preliminary design was provided by the
course coordinator.
The capital cost required for various equipment, utility costs, working labour costs, funds
required to purchase land and raw materials were estimated by taking appropriate assumptions
in calculations. The non-discounted and discounted cash flow diagrams were generated. A
preliminary Risk evaluation in the cost estimations was done using Sensitivity Analysis and
Profit Margin Analysis. Further, the Monte Carlo analysis was done to get a complete financial
picture of the project.
The Life Cycle Assessment was done for the product and entire process of production of
ethylbenzene to know the quantified environmental impact and energy consumption by the
plant, works as a primary tool used to support decision-making for Sustainable Development.
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PAGE
Contents NO.

Abstract 2

Process Flow Diagram

4
Stream Flow Table
5
Manufacturing Cost Summary
9
Equipment cost Summary
9

Result of LCA 11

Conclusion 12

References 12

Appendix 13
Estimation of cost of Raw materials, Revenue, Capital cost for
Equipment, Cost of utility and cost of labour 13
Cost of Raw materials
13
Capital cost of equipment
14

Utilities cost
18
Labour Cost 20

Manufacturing Costs
20
Economic Analysis
22

Cash Flow Analysis

22

Monte Carlo Analysis

27
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INTRODUCTION:
The topic of our interest is Design and Economics of the production plant of ethylbenzene. On
the basis of given data Capital cost for equipment, utilities, Labour cost and Manufacturing
cost were estimated after the assumption of location of plant.Later the profitability analysis
was done to get the annual revenue generation and cash flow sheets were prepared.Finally Life
cycle assessment for the entire process has been done to know the environmental impact of the
process.

ASSUMPTION:
• Plant is constructed in Surat, Dist- Adajan Patiya.
• The Plant construction period is of one year.
• The Chemical Engineering Plant Cost Index (CEPCI) was taken as 776.9 for the year
2022
• The depreciation method used is the MACRS 5-year schedule.
• The taxation rate is taken as 30 + 12%.
• The project is designed for plant life of 20 years.
• The Salvage value of the plant is zero
• The assumed discount rate is 10%

RESULTS:
Process flow Diagram: Figure 1: Ethylbenzene Process Flow Diagram
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Stream Flow Table:

Components, Pressure, Temperature, Flow Rates of all the streams in the PFD
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Table 1: Stream Table for Unit 300

Table 2: Utility Summary table for Unit 300

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Table 3: Major Equipment Summary for Unit 300

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Table 3: Major Equipment Summary for Unit 300

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MANUFACTURING COST SUMMARY

(₹)
Labour 4500000
Raw materials 6070101840
Utility 738322009.2
Revenue from Sales 20827600800
Land 27500000
FCI (GR) 1532098303
Manufacturing cost (COMd) 8662424029
Table 4: List of different cost estimations

EQUIPMENT COST SUMMARY

Cp0 Cbm Cbmo

E-301 1776832.5 20309045.85 5845765.5
E-302 1926630 22021296.9 6338616
E-303 6432555 73523790.75 21163140
E-304 19250550 116428757.3 63334282.5
E-305 4423252.5 26752169.7 14552512.5
E-306 1737135 10506327.45 5715178.5
E-307 1711185 9954944.25 5629802.25
E-308 8988675 52292425.2 29572747.5
E-309 1529062.5 8895422.025 5030618.25
H-301 69301575 343121370.8 194044350
P-301 A/B 497717.25 3326758.845 1612607.25
P-302 A/B 201369 1418066.603 652436.625
P-303 A/B 201369 1418066.603 652436.625
P-304 A/B 203936.25 1670559.105 660752.625
P-305 A/B 282526.5 2049820.77 915389.25
T-301 3689895 28179225.45 15017992.5
Trays-301 132731.25 20067202.5 11348550
T-302 3137152.5 23201562.38 12769710
Trays-302 111798 28548792.45 16145077.5
P-301 A/B 497717.25 3326758.845 1612607.25
P-302 A/B 201369 1418066.603 652436.625
P-303 A/B 201369 1418066.603 652436.625
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P-304 A/B 203936.25 1670559.105 660752.625

P-305 A/B 282526.5 2049820.77 915389.25
V-301 1279025.25 3650051.865 3849866.25
V-302 1659342 13380271.88 6753521.25
V-303 1345846.5 4165165.238 4050999
V-304 1199959.5 3643032.563 3611877.75
R-301 2717991 68818059.3 11062222.5
R-302 3679305.75 103986570.8 14974770
R-303 3204818.25 86048896.5 13043610
R-304 599047.8 9737370.75 2438124.75
142608201.3 1096998296 475280579.3
TABLE 5: Equipment cost summary

Results of life cycle assessment (LCA):

LCA ETHYL BENZENE <LC>

Flows 2937.375545
Resources 1465.727803
Deposited goods 1.800653354
Emissions to air 10.71074105
Emissions to fresh water 1458.241825
Emissions to sea water 0.894521754
Emissions to agricultural soil 1.74E-08
Emissions to industrial soil 9.36E-08

GWP 100 years AP

Global Warming Potential [kg CO2-Equiv.]

Acidification Potential [kg SO2-Equiv.]

0.6 7.2e-3
6.4e-3
0.5
5.6e-3
0.4 4.8e-3
4.0e-3
0.3
3.2e-3
0.2 2.4e-3

0.1 1.6e-3
0.8e-3
0.0
0.0e-3
Total IN: Electricity grid mix (producti...
IN: Electricity grid mix (producti... IN: Electricity grid mix (producti... Total IN: Electricity grid mix (produc...
IN: Electricity grid mix (produc... IN: Electricity grid mix (produc...
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FLOW SHEET OF LCA

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CONCLUSION:
• The plant is setup in Surat, Dist- Adajan Patiya. Area of land required 5 Acre, the
land was bought at 55 lac/acre, which comes out to be ₹2.75 Cr
• The plant construction period is 1 Year and the life of plant is 20 years
• The fixed capital investment (FCIL ) was estimated to be ₹ 1504598303
and working capital investment is ₹742822009, Salvage value was taken
to be 0
• Annual Cost of manufacturing is ₹866242029 and the revenue generated per year was
found to be ₹20827600800
• The net present value (NPV) is ₹5344.83 Cr
• Discounted payback period (DPBP) of 1.15 years, Present Value Ratio (PVR) of
33.47, and Discounted Cash flow diagram of return (DCFROR) of 350.58% indicates
the
healthy profitability aspects of the project.
• From the sensitivity analysis, NPV is least sensitive to fluctuations in FCIL and
significantly sensitive to COMd and revenue.
• Monte-Carlo simulations indicated the probability of profit as 61.20%.
• The product should be exported to locations of high demand during shortage times
and sold at a minimum ideal price of ₹ 250/kg to ensure good profit margins.
• The detailed environmental impact of the project was quantified using LCA

REFERENCES:
• https://www.dnaindia.com/mumbai/report-industries-seek-power-
tariff-cut-in-maharashtra-2778706
• https://www.statista.com/statistics/1171072/price-benzene-forecast-
globally/#:~:text=The%20average%20global%20price%20of,U.S.%
20dollars%20per%20metric%20ton
• https://www.indiamart.com/proddetail/ethylbenzene-
11667336712.html
• https://www.toweringskills.com/financial-analysis/cost-
indices/#chemical-engineering-plant-cost-index-cepci
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APPENDIX:
The production of EB takes place via the direct addition reaction between ethylene and
benzene:

The reaction between EB and ethylene to produce DEB also takes place:

Additional reactions between DEB and ethylene yielding triethylbenzene (and higher) are
also possible. However, in order to minimize these additional reactions, the molar ratio of
benzene to ethylene is kept high, at approximately 8:1. The production of DEB is
undesirable, and its value as a side product is low. In addition, even small amounts of DEB in
EB cause significant processing problems in the downstream styrene process. Therefore, the
maximum amount of DEB in EB is specified as 2 ppm. In order to maximize the production
of the desired EB, the DEB is separated and returned to a separate reactor in which excess
benzene is added to produce EB via the following equilibrium reaction:

The incoming benzene contains a small amount of toluene impurity. The toluene reacts with
ethylene to form ethyl benzene and propylene:

Estimations of Cost of Raw materials, Revenue, Capital cost for

Equipment, Cost of Utility and Cost of Labour
Cost of Raw materials
i. Benzene Cost of Benzene = ₹ 73/kg
Benzene required annually = 66278160kg
So, Total annual cost of Benzene = ₹ 4838305680/year

ii. Ethylene = ₹54/kg

Ethylene required annually = 22811040kg
So, Total annual cost of Ethylene = 1231796160/year

Total annual raw material cost = Cost of Benzene + Cost of Ethylene

Total annual raw material cost = ₹ 6070101840

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Revenue
Cost of Ethyl benzene = ₹ 250/kg
Ethyl benzene produced annually = 83310403kg
Total revenue generated annually = ₹ 20827600800
Cost of Land
Area of land required = 20000 m2 (5 acres approximately)
Cost of land for 5 acres = ₹ 28000000/-

Capital Cost of Equipment:

A detailed sample calculation for each type of equipment is shown below
1. Heat Exchanger
Design Pressure, P = 21, Heat transfer area A = 62.6
K1=4.8306, K2=-.8509 and K3=0.3187
CEPCI at 2001 = 397, CEPCI at 2022= 776.9
logCp0= K1+ K2 (logA)+ K3(logA)2, so Cp = $23691.1
C1=0.03881, C2=-0.11272 and C3=0.08183
logFp = C1+ C2(logP) + C3(logP)2
Fp =1.07852415, B1=1.63, B2 =1.66, Fm=2.7, Fbm= B1+B2(Fp)(Fm)= 6.46394523
Cbm = $270787
At base condition Fp =1, Fm=1, Fbase=B1 + B2 = 3.29
Cbmo=$77943.6

2. REACTOR
K1 = 3.497 K2= 0.4485 and K3 =0.1074
CEPCI at 2001 = 397, CEPCI at 2022= 776.9
logCp0= K1+ K2 (logA)+ K3(logA)2, so Cp = $18293.87
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CEPCI at 2001 = 397, CEPCI at 2022= 776.9

C1=C2=C3=0, for P<5 barg, logFp = C1+ C2(logP) + C3(logP)2

Fp=4.0888, Fbm=B1+B2(Fp)(Fm)= 25.31946

Cbm= $829111.9
At base condition Fp=1, Fm=1, Fbase=B1 + B2 = 3.29
Cbase = $ 978352

3. VESSELS
Design pressure, P= 2.5
K1=3.55565, K2=0.3776 and K3=0.0905
CEPCI at 2001 = 397, CEPCI at 2022= 776.9
logCp0= K1+ K2 (logA)+ K3(logA)2, so Cp = $15409.55

Fp =
If Fp<1, then Fp= 1
Identification number = 18 gives Fp=1
Also, B1=1.49 B2=1.52

Fbm=B1+B2(Fp)(Fm)= 2.853776
Cbm = Cp*Fbm = $43975.396
At base condition, Fp=0.8972 i.e = 1, , Fm=1, Fbase=B1 + B2 = 3.01
Cbase = $ 51890.97

4. PUMPS
Design pressure, P= 1.1 bar
K1=3.4771, K2=0.135 and K3==0.1438
CEPCI at 2001 = 397, CEPCI at 2022= 776.9
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logCp0= K1+ K2 (logA)+ K3(logA)2, so Cp = $10603.27257

C1=C2=C3=0, for P<10bar, logFp = C1+ C2(logP) + C3(logP)2

Fp=1,
Identification Number= 38, Fm=1.4
B1=1.89, B2=1.35
Cbm= Cp*(B1+B2(Fp)(Fm)) = $40080.37
At base condition, Fp=1, Fm=1, Fbase=B1+B2=3.24
Cbase= $47294.836

5. DISTILLATION COLUMN
K1 = 3.4974, K2 = 0.4485 and K3 = 0.1074
CEPCI at 2001 = 397, CEPCI at 2022 = 776.9
logCpo = K1 + K2 (logA) + K3 (logA)2, so Cp = $ 2636.085

Fp=
Identification number = 18 gives Fm=3.1
Also, B1 = 2.25, B2 = 1.82 Fbm = B1 + B2(Fp)(Fm) = 4.182
Cbm = Cp*Fbm = $ 279529.7

For trays,
K1 = 2.9949, K2 = 0.4465 and K3 = 0.3961
CEPCI at 2001 = 397, CEPCI at 2022 = 776.9
logCpo = K1 + K2 (logA) + K3 (logA)2, so Cp = $1490.64
N = 28
Fq = 1 (N>=20),
Identification number = 61, Fbm = 1.8
Cbm = Cpo*N*Fbm*Fq = $343952.5

EQUIPMENT COST SUMMARY

Cp0 Cbm Cbmo

E-301 1776832.5 20309045.85 5845765.5
E-302 1926630 22021296.9 6338616
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E-303 6432555 73523790.75 21163140

E-304 19250550 116428757.3 63334282.5
E-305 4423252.5 26752169.7 14552512.5
E-306 1737135 10506327.45 5715178.5
E-307 1711185 9954944.25 5629802.25
E-308 8988675 52292425.2 29572747.5
E-309 1529062.5 8895422.025 5030618.25
H-301 69301575 343121370.8 194044350
P-301 A/B 497717.25 3326758.845 1612607.25
P-302 A/B 201369 1418066.603 652436.625
P-303 A/B 201369 1418066.603 652436.625
P-304 A/B 203936.25 1670559.105 660752.625
P-305 A/B 282526.5 2049820.77 915389.25
T-301 3689895 28179225.45 15017992.5
Trays-301 132731.25 20067202.5 11348550
T-302 3137152.5 23201562.38 12769710
Trays-302 111798 28548792.45 16145077.5
P-301 A/B 497717.25 3326758.845 1612607.25
P-302 A/B 201369 1418066.603 652436.625
P-303 A/B 201369 1418066.603 652436.625
P-304 A/B 203936.25 1670559.105 660752.625
P-305 A/B 282526.5 2049820.77 915389.25
V-301 1279025.25 3650051.865 3849866.25
V-302 1659342 13380271.88 6753521.25
V-303 1345846.5 4165165.238 4050999
V-304 1199959.5 3643032.563 3611877.75
R-301 2717991 68818059.3 11062222.5
R-302 3679305.75 103986570.8 14974770
R-303 3204818.25 86048896.5 13043610
R-304 599047.8 9737370.75 2438124.75
142608201.3 1096998296 475280579.3
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TABLE 5: Equipment cost summary

annual annual cost

pumps rating(KW) KW-h (₹)
p-301 15 131400 778545
p-302 1 8760 51903
p-303 1 8760 51903
p-304 1.4 12264 72664.2
p-305 2.7 23652 140138.1
Sum 21.1 184836 1095153.3

FIGURE 2: Equipment Cost Distribution

UTILITY COST
1. Electricity
For electricity cost total annual electricity consumption was calculated which turns out to be
184836 kWh. The cost of industrial electricity in Gujarat is ₹ 5.925/kWh. This gives an
annual electricity cost of ₹ 1095153.3.
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2. Water and Steam

We know that,
CS,u = a (CEPCI) + b (CF)
where CS,u is the price of the utility, a and b are utility cost coefficients, CF is the price of
fuel in $/GJ, and CEPCI is the inflation parameter for projects in the U.S. From Literature
- CEPCI (2022) = 776.9
- Cost of Fuel (coal)(CF) in 2021 = $ 1.96/ GJ
Stream Flowrate Flow Rate Flow Rate CE
Name (kg/h) (m3/s) (kg/s) a b PCI Csf Csu Cost in ₹

bfw to E-301 851 0.00023638 0.236388 0.1058279 0.003 776.9 1.96 82.22360025 45971790.47

bfw to E-302 1121 0.00031138 0.311388 0.0803554 0.003 776.9 1.96 62.43403642 45982480.52

bfw to E-303 4341 0.00120583 1.205833 0.0208025 0.003 776.9 1.96 16.16738118 46109969.31

bfw to E-304 5424 0.00150666 1.506666 0.0166629 0.003 776.9 1.96 12.95130282 46152848.3

cw to E-305 118300 0.03286111 32.86111 0.0008307 0.003 776.9 1.96 0.651311 50621924.18

lps to E-306 4362 0.06028192 1.211666 0.0000193 0.0041 776.9 1.96 0.0230466751 66047945.28

cw to tE-307 174100 0.04836111 48.36111 0.0005869 0.003 776.9 1.96 0.4618770149 52831201.91

hps to E-308 3124 1.44629629 0.867777 0.0000261 0.0034 776.9 1.96 0.0269653671 55345553.18

cw to E-309 125900 0.03497222 34.97222 0.0007848 0.003 776.9 1.96 0.6156323407 50922829.39

459986542.5

3. Natural gas
Given Energy consumed per hour in Fired Heater is 22376 MJ/h
From the given thermal efficiency, the Energy that should be supplied by combusting the
Natural Gas will be = 22376/0.75 = 29834.67 MJ/h
Using the Gross Calorific value of Natural gas, the required flow rate of Natural Gas was
evaluated and the cost was calculated
Gross calorific value 50MJ/kg
Flow rate supplied 29834.67/50 = 596.69 kg/hr
Cost per Kg 53.04 Kg
Annual consumption 596.69*24*365 = 5.227 kilo ton
Annual cost = 5.227*106 * 53.04 = Rs 277.24 million
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Now,
The Total Annual Utility cost = Annual cost of electricity + Annual cost of Water and Steam
+ Annual cost of Natural Cost
Total Annual Utility cost = ₹1095153.3+ ₹ 459986542.5 + ₹ 277240313.4
Total Annual Utility cost = ₹ 738322009.2

Labour Cost
Particulate processing steps P = 0
Non-particulate processing steps NNP = 16

Number of working weeks in a year = 49 (excluding 15 public holidays and 7 paid leaves)
Number of working shifts in a week = 5 (excluding 2 weekly off-day)
Hence, Number of working shifts in a year = 49 × 5 = 245
Number of working hours per operator in a year = 245 × 8 = 1960

Total shifts in a day = 3

Days in a year = 365
Total shifts in a year = 365 × 3 = 1095

Operators required for an operation = 1095/245 = 4.4694

Number of operators per shift = (6.29 + 31.7 P2 + 0.23 NNP) 0.5 = 3.1575
Total operators = 4.4694 × 3.1575 = 14.112

Hence no. of operators = 15

Salary of operators per year = ₹ 3,00,000.00
Annual Labour Cost= ₹ 45,00,000.00

Manufacturing costs
Type of Manufacturing cost Value (₹)
Labour 4500000
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Raw materials 6070101840

Utility 738322009.2
Supervisory & clerical labor 810000
Maintenance & Repairs 91925898.18
Operating supplies 13788884.73
Laboratory charges 675000
Patents & Royalties 264960032.5
Depreciation 153209830.3
Local taxes & Insurance 49027145.7
Plant overhead costs 16974884.73
Adminstration costs 14585384.73
Distribution & selling costs 971520119.1
Research & Development 441600054.2
Total Cost of Manufacturing COMd 8678791253
COM 8832001083
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Economic Analysis
Cash Flow Analysis
The cash flow analysis was done for the plant. The data used in the analysis are summarised
in Table 6. The method of Depreciation used in the cash flow analysis is Modified
Accelerated Cost Recovery System (MACRS) with a 5-year schedule. The details of MACRS
depreciation calculations are summarised in Table below.
in Cr
FCI GR ₹ 153.21
Land ₹ 2.75
FCI L ₹ 150.46
Working Capital, WC ₹ 27.58
Salvage, S ₹ 0
Life of Equipment, n 20.00
Depreciable capital, D ₹ 150.46
Revenue, R ₹ 2,082.76
Manufacturing cost, COM d ₹ 866.24

Discount Rate 10%

Life of Plant 20 years
TAX Rate 42% (30 + 12)
Construction Period 1 year

TABLE 6: Data used for cash flow analysis

MACRS Depreciation (10year equipment, 5 yr depreciation period)
End of
Year point dk Σdk FCI L - Σdk
₹ ₹ ₹
0 0 - - 150.46
₹ ₹ ₹
1 0 - - 150.46
₹ ₹ ₹
2 0.2 30.09 30.09 120.37
₹ ₹ ₹
3 0.32 48.15 78.24 72.22
₹ ₹ ₹
4 0.192 28.89 107.13 43.33
₹ ₹ ₹
5 0.1152 17.33 124.46 26.00
₹ ₹ ₹
6 0.1152 17.33 141.79 8.67
₹ ₹ ₹
7 0.0576 8.67 150.46 -
Table 7: Summary of MARCS Depreciation used in Cash Flow
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End Non discounted Discounted

of Total cash Cummulative Total cash flows Cummulative cash flows
Year flows (Cr) cash flow (Cr) (Cr) (Cr)
₹ ₹ ₹ ₹
0 -2.75 -2.75 -2.75 -2.75
₹ ₹ ₹ ₹
1 -178.04 -180.79 -161.85 -164.60
₹ ₹ ₹ ₹
2 718.22 537.43 593.57 428.97
₹ ₹ ₹ ₹
3 725.80 1,263.23 545.31 974.27
₹ ₹ ₹ ₹
4 717.71 1,980.95 490.21 1,464.48
₹ ₹ ₹ ₹
5 712.86 2,693.81 442.63 1,907.11
₹ ₹ ₹ ₹
6 712.86 3,406.67 402.39 2,309.50
₹ ₹ ₹ ₹
7 709.22 4,115.89 363.94 2,673.44
₹ ₹ ₹ ₹
8 705.58 4,821.47 329.16 3,002.60
₹ ₹ ₹ ₹
9 705.58 5,527.05 299.23 3,301.84
₹ ₹ ₹ ₹
10 705.58 6,232.63 272.03 3,573.87
₹ ₹ ₹ ₹
11 705.58 6,938.21 247.30 3,821.17
₹ ₹ ₹ ₹
12 705.58 7,643.79 224.82 4,045.99
₹ ₹ ₹ ₹
13 705.58 8,349.37 204.38 4,250.37
₹ ₹ ₹ ₹
14 705.58 9,054.95 185.80 4,436.17
₹ ₹ ₹ ₹
15 705.58 9,760.53 168.91 4,605.08
₹ ₹ ₹ ₹
16 705.58 10,466.11 153.55 4,758.64
₹ ₹ ₹ ₹
17 705.58 11,171.69 139.60 4,898.23
₹ ₹ ₹ ₹
18 705.58 11,877.27 126.90 5,025.14
₹ ₹ ₹ ₹
19 705.58 12,582.85 115.37 5,140.51
₹ ₹ ₹ ₹
20 705.58 13,288.43 104.88 5,245.39
₹ ₹ ₹ ₹
21 735.91 14,024.34 99.44 5,344.83

Table 8: Summary of Cash Flow Analysis of the plant

P a g e | 24
 P a g e | 25

PROFIBILITY ANALYSIS
• Time criterion of profitability
The discounted worth of Land = ₹ -2.75 Cr
The discounted worth of Working capital = ₹ -25.07 Cr
Sum of the discounted worth of Land and WC = ₹ -27.82 Cr
From interpolating in the cumulative cash flow diagram, we get
Discounted payback period (DPBP) = 1.15 years
So, a period of 1.15 years after the plant start-up is required to recover our FCIL
DPBP is just 1.15 years which means all our FCIL is quickly recovered compared to
the total plant life of 20 years

• Cash criterion of profitability:

NPV = ₹ 5344.83 Cr
Sum of positive discounted cash flows = ₹ 5509.43 Cr
Sum of negative discounted cash flows = ₹ 164.60 Cr
Present value ratio (PVR) = 33.47115

PVR is way greater than 1, so the process is profitable

• Interest rate criterion of profitability:

Discount rate NPV in crores
10 ₹ 5,344.83
20 ₹ 2,745.49
75 ₹ 443.06
100 ₹ 267.84
350 ₹ 3.37
400 ₹ -2.39
500 ₹ -8.45
Variation of NPV with Discount rate

We know that, Net Present Value at Discounted Cash Flow Rate of Return
(DCFROR) = ₹ 0
From interpolating the above data, we get
Discounted Cash Flow Rate of Return (DCFROR) = 350.58 %
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SENSIVITY ANALYSIS
The evaluation of risk in evaluating profitability is done using the Sensitivity Analysis
applied to NPV. The variations in NPV value due to the effect of dynamic market
fluctuations are quantified and the Sensitivity coefficients are determined.

Figure: Sensitivity Analysis indicating the change in NPV corresponding to the

fluctuations of the respective parameters
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Monte Carlo Analysis

The evaluation of risk in evaluating profitability is Quantified using Monte Carlo Simulation.

There is a deviation in expenses manufacturing cost revenue. So taking standard deviation

probability of profit is generated with 500 random simulations.

Type of value Net present value

Minimum -227.85

Maximum 806.83

Mean 31.17

Standard deviation 101.8578393

NPV data used in Monte Carlo Analysis

Monte Carlo Histogram depicting Frequency of occurrence vs NPV

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Monte Carlo Histogram depicting Cumulative Frequency