Gireesh Contract Works

Promoted by
Mr.Gireeesh Chandran .B
Address
Sarovaram, KMRA 14
Konchiravila, Manacaud PO. Trivandrum
Gireesh Chandran .B

Prepared by

Mahesh MV
Mob: 9995556874
Arthajothi
2nd Floor
Anitha Towers
Opp SBI Vazhuthacaud
Trivandrum 695014

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 Gireesh Chandran .B

PROJECT REPORT

Gireesh Contract Works

Sarovaram, KMRA 14
Konchiravila, Manacaud PO. Trivandrum

Promoted by
Mr.Gireeesh Chandran .B

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 Gireesh Chandran .B
Name of Project Gireesh Contract Works
Promoted by Mr.Gireeesh Chandran .B
Statutory Status of Business Proprietorship
Nature of business To revamp a works contract business in Trivandrum

Address Sarovaram, KMRA 14

Konchiravila, Manacaud PO. Trivandrum
Nature of business
1 Construction of Residential Houses
2 Construction of Villas, Flats
3 Other construction workers
Promoter Working capital
Particulars Contribution Term loan loan
Tools and Equipments 30,000.00 5,25,000.00
Furniture and fixtures 25,000.00 1,25,000.00
Electrical Fittings 50,000.00 3,50,000.00
Purchase of materials 3,00,000.00
Total 4,05,000.00 10,00,000.00 -
Total Project cost 14,05,000.00

Term Loan 10,00,000.00

Capital Contribution 4,05,000.00 14,05,000.00

Rate of interest 11.50%

Repayment Period in yrs 10.00
Repayment Period in months 120.00
Monthly EMI 14,059.54
Revenue from operation for the first year 30,37,000.00
Repayment Shedule
YEAR Interest Principal Balance
1 1,12,076.37 56,638.16 9,43,361.84
2 1,05,208.47 63,506.06 8,79,855.78
3 97,507.77 71,206.77 8,08,649.01
4 88,873.28 79,841.25 7,28,807.76
5 79,191.79 89,522.75 6,39,285.02
6 68,336.32 1,00,378.21 5,38,906.80
7 56,164.52 1,12,550.01 4,26,356.79
8 42,516.79 1,26,197.75 3,00,159.05
9 27,214.13 1,41,500.40 1,58,658.65
10 10,055.89 1,58,658.65 0.00
Fianancial Summary
Year Sales Net Profit NP Ratio
1 30,37,000.00 4,05,600.00 13.36%
2 32,80,000.00 4,96,300.00 15.13%
3 35,42,000.00 5,75,900.00 16.26%
4 38,25,000.00 6,63,200.00 17.34%
5 41,31,000.00 7,89,700.00 19.12%
6 44,61,000.00 8,00,500.00 17.94%
7 48,18,000.00 9,08,500.00 18.86%

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 Gireesh Chandran .B
Project Overview

Gireesh Contract Works, spearheaded by Mr. Gireesh Chandran B., is a

proprietorship-based construction business aiming to revamp the works contract
sector in Trivandrum. Located at Sarovaram, KMRA 14, Konchiravila, Manacaud PO,
Trivandrum, the company focuses on various construction projects, including the
construction of residential houses, villas, flats, and other related works.
The project's total cost amounts to INR 14,05,000, with the promoter contributing INR
4,05,000 and securing a term loan of INR 10,00,000. The funds are allocated to different
aspects of the business, including tools and equipment (INR 5,25,000), furniture and
fixtures (INR 1,25,000), and electrical fittings (INR 3,50,000), along with INR 3,00,000
for the purchase of materials.
The term loan carries an 11.50% interest rate, and the repayment period spans 10 years
with a monthly EMI of INR 14,059.54. The repayment schedule illustrates a systematic
reduction in the outstanding balance over the ten-year period, with the final
installment clearing the remaining amount.
The financial projections indicate promising growth for Gireesh Contract Works. In the
first year, the projected revenue from operations is INR 30,37,000, resulting in a net
profit of INR 4,05,600 and a net profit ratio of 13.36%. Subsequent years demonstrate a
consistent upward trend, with sales, net profit, and net profit ratios increasing
annually. By the tenth year, the company anticipates sales of INR 48,18,000, a net profit
of INR 9,08,500, and a net profit ratio of 18.86%.
The repayment schedule and financial summaries collectively reflect a sound business
plan, showcasing the company's ability to generate revenue and manage its financial
obligations. The steady growth in sales and profits over the ten-year period
underscores the sustainability and profitability of Gireesh Contract Works. This
positive trajectory can be attributed to effective project planning, strategic allocation of
funds, and a robust business model tailored to the construction industry in
Trivandrum.
The construction sector in Trivandrum is poised for growth, and Gireesh Contract
Works is well-positioned to capitalize on emerging opportunities. The project
summary encapsulates a vision of success, with a commitment to quality construction,
efficient financial management, and a dedication to meeting the diverse needs of
clients in the region. As the company establishes itself as a key player in the
Trivandrum construction landscape, it is poised to contribute significantly to the local
economy and create a lasting impact in the industry.

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 Gireesh Chandran .B
PROJECT ASSUMPTION
To provide a comprehensive overview of the Gireesh Contract Works project, it's
essential to outline the key assumptions made during the planning and projection
phases. These assumptions play a crucial role in shaping the project's trajectory and
form the foundation upon which the financial and operational forecasts are built. Here
are some key assumptions associated with the project:
Market Conditions: The projections are based on the assumption that market
conditions in Trivandrum remain conducive to construction activities. Economic
stability, demand for residential and commercial properties, and a favorable regulatory
environment are assumed to persist.
Material Costs: The project assumes that material costs will remain within the
anticipated range. Fluctuations in the prices of construction materials, such as cement,
steel, and wood, could impact overall project costs.
Labor Availability and Costs: The availability of skilled and unskilled labor at
reasonable costs is a crucial factor. The project assumes a stable labor market without
significant disruptions, strikes, or unforeseen increases in labor costs.
Interest Rates: The interest rates on term loans and working capital loans are assumed
to remain constant throughout the repayment period. Changes in interest rates could
affect the overall cost of financing and impact the financial projections.
Project Timelines: The construction projects are assumed to be completed within the
specified timelines. Delays in project completion could affect revenue recognition and
cash flow, impacting the financial performance of the company.
Sales Projections: The sales projections are based on the assumption that the company
can secure a steady stream of construction projects. The ability to attract clients, win
contracts, and successfully deliver projects on time and within budget is vital to
achieving the projected revenue figures.
Operating Expenses: The operating expenses, including utilities, administrative costs,
and other overheads, are assumed to align with the projected growth of the business.
Unexpected increases in operating expenses could impact net profit margins.
Regulatory Compliance: The project assumes that the business will comply with all
relevant regulations and licensing requirements. Any regulatory challenges or changes
in compliance standards could have implications for the project's success.
Client Satisfaction: The financial projections assume a high level of client satisfaction,
leading to repeat business and positive word-of-mouth referrals. Maintaining a
positive reputation and delivering quality construction work are integral to achieving
these assumptions.
Economic Factors: The project assumes a stable economic environment, with factors
such as inflation and exchange rates remaining within reasonable bounds. Economic
uncertainties or drastic changes could impact the overall financial health of the
business.
It's crucial for the project stakeholders to regularly reassess these assumptions, taking
into account any changes in the external environment or unforeseen circumstances.
Regular monitoring and adjustment of the business strategy will help ensure that the
project remains adaptive and resilient in the dynamic construction industry.

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Financial Summary
Financial assumptions are critical elements that underpin the projections and financial models
for Gireesh Contract Works. These assumptions help create a framework for estimating future
financial performance and guide decision-making. Here are key financial assumptions
associated with the project:
Revenue Growth: The financial projections assume a steady and realistic revenue growth over
the ten-year period. This growth is based on the successful acquisition of construction projects
and an expanding client base.
Sales Price Stability: The assumed sales prices for construction projects are expected to remain
relatively stable. Any unforeseen changes in pricing due to market fluctuations or competitive
pressures could impact revenue projections.
Cost of Goods Sold (COGS): The project assumes that the cost of construction materials, labor,
and other direct costs remains within the estimated range. Fluctuations in these costs could
influence the gross profit margin.
Gross Profit Margin: The gross profit margin is assumed to remain consistent over the years.
Changes in the gross profit margin could affect the overall profitability of the projects
undertaken by Gireesh Contract Works.
Operating Expenses: Operating expenses, including administrative costs, utilities, and other
overheads, are assumed to be in line with the projected business growth. Unexpected increases Mr.G
in operating expenses could impact net profit margins. wh
Interest Rates: The interest rates on term loans and working capital loans are assumed to The p
remain constant throughout the repayment period. Changes in interest rates could impact the
cost of financing and, consequently, the overall profitability.
Debt Repayment Schedule: The project assumes timely and consistent repayment of term
loans. Any deviations from the repayment schedule could result in additional interest costs or
impact the company's financial health.
Depreciation: Depreciation expenses are assumed to be calculated using a consistent method
over the years. Changes in the depreciation policy could impact net profit and cash flow.
Tax Rates: The project assumes that applicable tax rates remain consistent. Any changes in tax
regulations or rates could affect the overall tax liability and, consequently, the net profit.
Working Capital: The project assumes effective management of working capital, including
inventory, accounts receivable, and accounts payable. Efficient working capital management is
crucial for maintaining liquidity and supporting day-to-day operations.
Capital Expenditures: The financial projections assume that capital expenditures for tools,
equipment, furniture, and fixtures are sufficient for the business's needs. Any unexpected
capital requirements could impact cash flow.
Profitability Ratios: The project assumes that profitability ratios, such as net profit margin and
return on investment, remain within expected ranges. Deviations from these ratios could signal
operational challenges or inefficiencies.
Regular monitoring and periodic reassessment of these financial assumptions are essential to
ensure the accuracy and relevance of the financial projections. Adjustments may be necessary
based on changes in market conditions, regulatory environments, or the overall business
landscape. Sound financial management and flexibility in response to changing circumstances
will contribute to the long-term success of Gireesh Contract Works.

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 Gireesh Chandran .B

About the promoter

The promoter of Gireesh Contract Works, Mr. Gireesh Chandran B., plays a pivotal role in
shaping the vision and success of the business. Here is some information about the promoter:
Name: Mr. Gireesh Chandran B.
Background and Experience: Mr. Gireesh Chandran B. brings a wealth of experience and
expertise to the construction industry. His background may include education and training in
civil engineering, architecture, or a related field. The specifics of his educational qualifications
and professional experience would provide valuable insights into his capabilities and
knowledge.
Entrepreneurial Spirit: As the promoter of a proprietorship-based business, Mr. Gireesh
Chandran B. demonstrates an entrepreneurial spirit. This includes the ability to identify
business opportunities, take calculated risks, and drive the growth and success of Gireesh
Contract Works.
Mr.G
Industry Knowledge: Having chosen to revamp a works contract business in Trivandrum, Mr. wh
Gireesh Chandran B. likely possesses in-depth knowledge of the local construction industry.
This knowledge is crucial for understanding market dynamics, identifying potential projects, The p
and navigating regulatory requirements.
Leadership and Management Skills: Successful entrepreneurship requires effective leadership
and management skills. Mr. Gireesh Chandran B. is likely responsible for strategic decision-
making, project planning, resource allocation, and overall business management. His ability to
lead a team and steer the company toward its goals is a key factor in the project's success.
Financial Acumen: The financial success of Gireesh Contract Works is closely tied to Mr.
Gireesh Chandran B.'s financial acumen. This includes the ability to secure funding, allocate
resources efficiently, and make sound financial decisions. The inclusion of detailed financial
projections in the project summary suggests a focus on financial planning and management.
Commitment to Quality: In the construction industry, a commitment to quality workmanship
is paramount. It can be assumed that Mr. Gireesh Chandran B. places a strong emphasis on
delivering high-quality construction projects. This commitment is essential for building a
positive reputation in the industry and securing repeat business.
Vision for the Company: The decision to revamp a works contract business indicates a vision
for growth and success. Mr. Gireesh Chandran B. likely has a clear vision for the future of
Gireesh Contract Works, including expansion plans, market positioning, and a commitment to
excellence.
Understanding the background, skills, and vision of the promoter is crucial for stakeholders,
investors, and clients associated with Gireesh Contract Works. It provides confidence in the
leadership of the business and sheds light on the factors that contribute to the company's
potential success in the Trivandrum construction sector.

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 Gireesh Chandran .B
Pricing Strategy
The pricing strategy for Gireesh Contract Works is a critical component of the overall business
strategy, influencing the company's competitiveness, profitability, and market positioning. Here is
an outline of a potential pricing strategy for the construction business:
Cost-Plus Pricing:
Methodology: Adopt a cost-plus pricing approach where the company calculates the total
cost of each construction project, including labor, materials, overhead, and a predetermined
profit margin.
Advantages: This approach ensures that all costs are covered, and a desired profit margin is
achieved. It provides transparency to clients regarding project costs.
Market-Based Pricing:
Research: Conduct market research to understand the pricing standards and competitive
landscape in the Trivandrum construction industry.
Competitive Positioning: Set prices in alignment with industry norms, considering factors
such as project complexity, quality of work, and additional services provided.
Value Proposition: Communicate the value proposition to clients, highlighting the quality
and unique features that justify the pricing.
Value-Based Pricing:
Differentiation: Emphasize the unique value propositions, expertise, or specializations that
set Gireesh Contract Works apart from competitors.
Client Education: Educate clients about the added value they receive, justifying potentially
higher prices for superior service, expertise, or project outcomes.
Project-Specific Pricing:
Customization: Tailor pricing to the specific requirements of each construction project.
Factors such as project size, complexity, and timeline can influence pricing.
Flexibility: Offer flexibility in pricing structures, such as fixed-price contracts, time and
materials contracts, or cost-plus contracts, based on client preferences and project specifics.
Volume-Based Discounts:
Incentives: Consider offering volume-based discounts for clients who engage Gireesh
Contract Works for multiple projects or for larger-scale projects.
Long-Term Relationships: Encourage long-term relationships with clients by providing
incentives for repeat business.
Transparent Pricing Communication:
Clarity: Maintain transparency in pricing by clearly outlining the breakdown of costs, profit
margins, and any additional fees.
Communication: Communicate pricing structures effectively to clients during the project
proposal stage, ensuring a clear understanding of the financial aspects of the construction
services.
Adaptability to Market Changes:
Monitoring: Regularly monitor market conditions, industry trends, and changes in costs to
ensure that the pricing strategy remains competitive and profitable.
Adjustment: Be prepared to adjust pricing strategies in response to market fluctuations,
economic changes, or shifts in client expectations.
Client Consultation:
Needs Assessment: Conduct thorough consultations with clients to understand their specific
needs, budget constraints, and expectations.
Custom Solutions: Tailor pricing to meet client expectations while ensuring profitability for
Gireesh Contract Works.
By combining elements of cost-plus, market-based, and value-based pricing, Gireesh Contract
Works can develop a nuanced and effective pricing strategy that aligns with market conditions,
delivers value to clients, and supports the company's financial objectives. Regular reviews and
adjustments based on market dynamics and client feedback will contribute to the ongoing success of
the pricing strategy.

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SALES AND MARKETING STRATEGY

Developing a robust sales and marketing strategy is crucial for Gireesh Contract Works to attract clients,
secure construction projects, and establish a strong presence in the Trivandrum construction industry. Here's
an outline of a comprehensive sales and marketing strategy for the business:
1. Market Research:
Conduct thorough market research to understand the Trivandrum construction industry, including market
size, trends, and the competitive landscape.
Identify target customer segments, such as homeowners, real estate developers, or businesses in need of
construction services.
2. Unique Selling Proposition (USP):
Define the unique value proposition that sets Gireesh Contract Works apart from competitors.
Highlight key strengths, such as expertise in specific types of construction, quality workmanship, or timely
project delivery.
3. Branding and Positioning:
Develop a strong brand identity that reflects the company's values, expertise, and commitment to quality.
Position the brand as a reliable and trustworthy choice for construction projects in Trivandrum.
4. Online Presence:
Create a professional and user-friendly website showcasing the company's portfolio, services, and contact
information.
Utilize social media platforms to engage with the local community, share project updates, and build brand
awareness.
5. Networking:
Attend local industry events, trade shows, and networking functions to connect with potential clients,
suppliers, and industry stakeholders.
Join local business associations and construction-related groups to expand the company's network.
6. Client Testimonials and Case Studies:
Showcase successful projects through client testimonials and detailed case studies on the company's website.
Highlight the positive experiences of previous clients to build credibility and trust.
7. Digital Marketing:
Implement digital marketing strategies, including search engine optimization (SEO), online advertising, and
content marketing, to increase online visibility.
Use targeted online campaigns to reach potential clients and drive traffic to the company's website.
8. Local SEO Optimization:
Optimize the company's online presence for local search, ensuring that it appears prominently in local search
engine results.
Claim and optimize the company's Google My Business listing to enhance local visibility.
9. Referral Programs:
Establish referral programs to encourage satisfied clients, industry partners, and contacts to refer potential
clients to Gireesh Contract Works.
Offer incentives, such as discounts or bonuses, for successful referrals.
10. Strategic Partnerships:
Build strategic partnerships with local suppliers, architects, real estate agents, and other relevant
professionals.
Collaborate on joint marketing initiatives to expand the company's reach and access new client bases.

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Our Target Market

Identifying and defining the target market is a crucial step in developing a successful
sales and marketing strategy for Gireesh Contract Works. Here's a breakdown of the
potential target market for the construction business:
1. Residential Homeowners:
Gireesh Contract Works can target individual homeowners who are looking to construct
or renovate their residences.
Services may include the construction of new homes, home extensions, remodeling, or
general construction and repair works.
2. Real Estate Developers:
Targeting real estate developers involved in residential or commercial projects can be a
lucrative avenue.
Offer comprehensive construction services for new developments, including the
construction of villas, flats, and other residential or commercial properties.
3. Small to Medium-Sized Businesses:
Position Gireesh Contract Works as a construction solution for small to medium-sized
businesses seeking office or retail space construction, renovation, or expansion.
4. Commercial Property Owners:
Target owners of commercial properties such as retail stores, restaurants, or offices who
may require construction services for tenant improvements, expansions, or general
maintenance.
5. Government and Municipal Projects:
Explore opportunities in government and municipal construction projects, including
infrastructure development, public facilities, and community construction initiatives.
6. Educational Institutions:
Target construction projects in the education sector, including schools, colleges, and
universities, for new buildings, renovations, or expansions.
7. Healthcare Facilities:
Focus on healthcare-related construction projects, including the construction or
renovation of hospitals, clinics, and medical facilities.
8. Industrial Clients:
Explore opportunities with industrial clients requiring construction services for factories,
warehouses, or industrial facilities.
9. Property Management Companies:
Collaborate with property management companies that oversee multiple properties,
offering construction services for maintenance, repairs, and improvements.
10. Non-Profit Organizations:
Explore partnerships with non-profit organizations involved in community development
projects, affordable housing initiatives, or other construction-related endeavors.
11. Architects and Designers:
Develop relationships with architects and interior designers who may recommend
Gireesh Contract Works for construction projects.
12. Local Businesses and Restaurants:
Target local businesses, including restaurants and cafes, for construction services related
to interior design, renovations, or expansions.
13. Homebuilders and Investors:

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Location Significance
The location of Gireesh Contract Works in Trivandrum holds significant importance for
the success and growth of the business. Trivandrum, also known as
Thiruvananthapuram, is the capital city of the Indian state of Kerala. Here are several
aspects highlighting the significance of the location for Gireesh Contract Works:
Economic Growth and Development:
Trivandrum has been experiencing steady economic growth and development,
creating opportunities for construction projects. The city's expanding economy
and increasing urbanization contribute to a demand for residential, commercial,
and infrastructure projects.
Booming Real Estate Sector:
The real estate sector in Trivandrum has been vibrant, with a growing demand
for housing, commercial spaces, and infrastructure developments. Gireesh
Contract Works can tap into this thriving market by offering construction
services for various property types.
Government Initiatives and Projects:
Trivandrum is often a hub for government initiatives and projects, including
infrastructure development, public facilities, and urban planning. The presence
of such projects provides additional opportunities for Gireesh Contract Works to
participate in government contracts and collaborations.
Educational and Healthcare Hub:
Trivandrum is known for its educational institutions and healthcare facilities.
The demand for construction services in these sectors, including the construction
of schools, colleges, hospitals, and research centers, presents a significant market
for Gireesh Contract Works.
Cultural and Historical Significance:
Trivandrum, with its rich cultural and historical heritage, attracts various
construction projects related to heritage conservation, restoration, and the
construction of cultural facilities. Gireesh Contract Works can play a role in
preserving and contributing to the city's cultural legacy.
Tourism and Hospitality Sector:
The tourism industry in Trivandrum contributes to the demand for construction
services, especially in the hospitality sector. Gireesh Contract Works may find
opportunities in constructing hotels, resorts, and other tourism-related
infrastructure.
Local Networking and Relationships:
The local presence in Trivandrum allows Gireesh Contract Works to build strong
relationships with local suppliers, subcontractors, architects, and other industry
professionals. Networking within the community can lead to valuable
partnerships and collaborations.
Environmental Considerations:
Trivandrum's tropical climate and environmental considerations may influence
construction requirements. Gireesh Contract Works can adapt its construction
methods and materials to align with local environmental standards and
sustainability initiatives.
Competitive Landscape:
Understanding the competitive landscape in Trivandrum is crucial for Gireesh
Contract Works. Local competition, pricing dynamics, and market trends play a
significant role in shaping the business strategy.

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SWOT Analysis
A SWOT analysis (Strengths, Weaknesses, Opportunities, Threats) is a strategic planning tool that helps
organizations, like Gireesh Contract Works, to assess internal and external factors that may affect their
business. Here's a SWOT analysis for Gireesh Contract Works:
Strengths:
Experience and Expertise:
Gireesh Contract Works benefits from the experience and expertise of Mr. Gireesh Chandran B., the
promoter, bringing a wealth of knowledge to the construction industry.
Comprehensive Service Offering:
The company offers a range of construction services, including residential houses, villas, flats, and
other construction works, providing versatility in addressing diverse client needs.
Quality Workmanship:
Emphasizing a commitment to quality construction work can be a strength, enhancing the
company's reputation and attracting clients who prioritize excellence.
Local Presence in Trivandrum:
The strategic location in Trivandrum positions Gireesh Contract Works to capitalize on the city's
growing construction market and establish strong local connections.
Financial Planning and Projections:
The inclusion of detailed financial projections in the project summary indicates a focus on financial
planning, which can contribute to sustainable business growth.
Weaknesses:
Dependence on Local Market:
A potential weakness could be overdependence on the local market in Trivandrum. Diversifying
geographically may mitigate this risk.
Limited Brand Recognition:
If the company is relatively new or has limited brand recognition, this could be a weakness.
Implementing effective marketing strategies can address this challenge.
Limited Specialization:
While versatility is a strength, limited specialization in a niche area may be a weakness. Assessing
opportunities to specialize in certain types of construction projects can be explored.
Reliance on External Suppliers:
If Gireesh Contract Works heavily relies on external suppliers, disruptions in the supply chain could
impact project timelines and costs.
Opportunities:
Market Expansion:
Exploring opportunities to expand the business into adjacent markets or neighboring cities could
contribute to increased revenue and growth.
Green and Sustainable Construction:
Growing interest in sustainable construction provides an opportunity for Gireesh Contract Works to
position itself as a provider of eco-friendly and energy-efficient construction solutions.
Government Contracts and Initiatives:
Actively pursuing government contracts and participating in government initiatives for
infrastructure development can open new avenues for the company.
Technology Integration:
Embracing construction technologies, such as Building Information Modeling (BIM) or innovative
construction methods, can enhance efficiency and competitiveness.
Threats:
Economic Downturn:
Economic downturns or recessions can impact the construction industry, potentially leading to
reduced demand for construction services.
Intense Competition:
The construction industry can be highly competitive. Gireesh Contract Works should continuously
monitor and adapt to market dynamics to stay ahead of competitors.

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Mission and Vision Statement

Mission Statement: Gireesh Contract Works is committed to delivering

exceptional construction solutions that exceed client expectations, uphold the
highest standards of quality and craftsmanship, and contribute to the sustainable
development of communities in Trivandrum. Our mission is to be a trusted
partner in building dreams, creating lasting structures, and fostering a legacy of
excellence in the construction industry.

Vision Statement: Our vision at Gireesh Contract Works is to be the premier

choice for construction services in Trivandrum, known for innovation, reliability,
and a relentless pursuit of excellence. We aspire to be a driving force in shaping
the city's landscape, contributing to its growth, and setting benchmarks for
superior construction practices. Through our commitment to ethical business
practices and a focus on sustainable development, we aim to be leaders in the
construction sector, making a positive impact on the lives of our clients and the
communities we serve.

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Products and Services
Products and Services Offered by Gireesh Contract Works:
Construction of Residential Houses:
Gireesh Contract Works specializes in the construction of residential houses, offering end-to-end
solutions for clients looking to build their dream homes. This includes planning, design, and
execution of residential construction projects.
Construction of Villas and Flats:
The company provides construction services for villas and flats, catering to clients seeking quality and
aesthetically pleasing living spaces. This encompasses both individual villas and multi-unit
residential complexes.
Other Construction Works:
Gireesh Contract Works offers a broad range of construction services beyond residential projects. This
includes commercial buildings, educational institutions, healthcare facilities, industrial structures, and
various other construction works.
Tools and Equipments:
The company provides tools and equipment necessary for construction projects. This may include
machinery, hand tools, and specialized equipment required for various aspects of the construction
process.
Furniture and Fixtures:
Gireesh Contract Works offers services related to the installation of furniture and fixtures. This could
involve the design and placement of custom-built furniture or the installation of pre-fabricated
fixtures in residential or commercial spaces.
Electrical Fittings:
The company specializes in electrical fittings for construction projects, ensuring safe and efficient
electrical systems in residential and commercial buildings. This includes wiring, lighting, and other
electrical installations.
Purchase of Materials:
Gireesh Contract Works facilitates the procurement of construction materials, managing the sourcing
and purchasing process. This ensures that the required materials for each project meet quality
standards and are obtained at competitive prices.
Key Differentiators:
Quality Craftsmanship:
Gireesh Contract Works prides itself on delivering construction projects with the highest standards of
quality and craftsmanship. Attention to detail and a commitment to excellence set the company apart
in the industry.
Comprehensive Solutions:
The company offers comprehensive construction solutions, covering a wide spectrum of projects. This
versatility allows Gireesh Contract Works to meet the diverse needs of clients across different sectors.
Client-Centric Approach:
Gireesh Contract Works prioritizes a client-centric approach, ensuring open communication,
collaboration, and a thorough understanding of client requirements. Tailoring solutions to meet
individual client needs is a key focus.
ISustainability Focus:
Gireesh Contract Works is committed to sustainable construction practices. This includes
environmentally friendly building materials, energy-efficient solutions, and a dedication to
minimizing the environmental impact of construction projects.
The array of products and services provided by Gireesh Contract Works reflects a commitment to meeting
the diverse construction needs of clients while emphasizing quality, innovation, and sustainability in every
project undertaken.

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Revenue Forecast
Sales projections over a period of 7 years can be highly significant for businesses and organizations. It's important to note that sales
projections are estimates and subject to uncertainties and external factors that can impact actual results. Regular monitoring, periodic
updates, and adjustments based on market conditions are necessary to maintain the accuracy and relevance of sales projections over a 7-
year period.It is important to state that our sales forecast is based on the data gathered during our feasibility studies and also some of the
assumptions readily available in the field. Below is the sales projection for Anchal Hotel, it is based on the location of our hotel and the
services and products that we will be offering;

Product Year-1 Year-2 Year-3 Year-4 Year-5 Year-6 Year-7

Construction of Residential Houses 60% 18,22,200.00 19,68,000.00 21,25,200.00 22,95,000.00 24,78,600.00 26,76,600.00 28,90,800.00
Construction of Villas, Flats 25% 7,59,250.00 8,20,000.00 8,85,500.00 9,56,250.00 10,32,750.00 11,15,250.00 12,04,500.00
Other construction workers 15% 4,55,550.00 4,92,000.00 5,31,300.00 5,73,750.00 6,19,650.00 6,69,150.00 7,22,700.00
Total 100% 30,37,000.00 32,80,000.00 35,42,000.00 38,25,000.00 41,31,000.00 44,61,000.00 48,18,000.00

7 Years Revenue Forecast Chart Title

1,20,00,000.00 600000000%
Other construction workers
1,00,00,000.00 500000000%

80,00,000.00 400000000%
Construction of Villas, Flats
60,00,000.00 300000000%

40,00,000.00 200000000%
Construction of Residential Houses
20,00,000.00 100000000%

0.00 0%
Year-1 Year-2 Year-3 Year-4 Year-5 Year-6 Year-7 Year-1 Year-2 Year-3 Year-4 Year-5 Year-6 Year-7

Construction of Residential Houses Construction of Villas, Flats

Other construction workers Total

Total Total
60,00,000.00

Year-1 50,00,000.00
Year-7 11%
18%
40,00,000.00
Year-2
12%

30,00,000.00
Year-6
17%
Year-3
13% 20,00,000.00

Year-5 10,00,000.00
Year-4
15% 14%

0.00
1 2 3 4 5 6 7

16
 Gireesh Chandran .B

Staffing policy
A staffing policy is an important aspect of human resource management for any
business, including MSMEs (Micro, Small and Medium Enterprises). A staffing
policy outlines the procedures and practices for recruiting, hiring, and managing
employees within a business.

The business plan to hire the required numbers of employees that will helps to
meet the human recourse need to run the unit . In addition to the prompter
the unit need follwing human capital inorder to active its revenue surplus as
the promoter envisage. The promoter will work voluntarily in unit and
supervise the overall working of the business

Monthly Yearly
No of Salary/ Wages salary/Wages Cumulative
SL Designation employees per employee per employee wages/Salary yealry

1 Promoter 1 NA NA NA

2 Workers 2 14,000.00 1,68,000.00 3,36,000.00

3 Assitants 1 12,000.00 1,44,000.00 1,44,000.00

4,80,000.00

17
 Gireesh Chandran .B

Raio analysis -Significance

Ratio analysis is a powerful tool of financial analysis. In financial analysis, a ratio is used as a benchmark
for evaluation the financial position and performance of a firm. The absolute accounting figures reported
in the financial statements do not provide a meaningful understanding of the performance and financial
position of a firm. An accounting figure conveys meaning when it is related to some other relevant
information. The relationship between two accounting figures expressed mathematically, is known as a
financial ratio . Ratios help to summarize large quantities of financial data and to make qualitative
judgment about the firm’s financial performance.

Column1 Column2 Column3 Column4 Column5 Column6 Column7 Column8

Particulars Year-1 Year-2 Year-3 Year-4 Year-5 Year-6 Year-7
DSCR 3.73 4.24 4.80 5.42 6.09 6.83 7.63
TOL ADJ/TNW 0.32 0.24 0.19 0.16 0.13 0.12 0.10
Interest Coverage ratio 5.52 6.67 8.12 9.99 12.53 16.15 21.70
Asset Coverage ratio 1.65 2.00 2.46 3.10 4.03 5.34 7.48
BEP 66% 61% 57% 53% 48% 44% 40%
Cash Ratio 0.11 0.31 0.51 0.70 0.89 1.05 1.20
Gross Profit 23.67 24.66 25.61 26.51 27.38 28.20 29.00
Debt Equity Ratio 0.32 0.24 0.19 0.16 0.13 0.12 0.10
Proprietory 2.83 2.22 1.85 1.62 1.45 1.33 1.25
Quick Ratio 2.37 3.65 4.85 6.00 7.16 8.16 9.10
Current Ratio 3.86 5.11 6.29 7.40 8.53 9.52 10.43
Operating Expenses ratio 86.64 84.44 82.78 81.20 78.78 77.19 75.66

7.48
DSCR TOL ADJ/TNW Interest Coverage ratio

5.34
4.03
3.10
40.00

2.46
2.00
10.00

1.65
5
20.00
- 1 -
1 2 3 4 5 6 7 - 0.10 0.20 0.30 0.40 1 2 3 4 5 6 7 ASSET COVERAGE RATIO

BEP This chart isn't available in your Gross Profit Debt Equity Ratio
version of Excel.Editing this shape
100% 40.00
or saving this workbook into a 7
different file format will 20.00 4
0% permanently break the chart. - 1
1 2 3 4 5 6 7
1 2 3 4 5 6 7
- 0.05 0.10 0.15 0.20 0.25 0.30 0.35

Proprietory Quick Ratio Current Ratio 90.00 Operating Expenses ratio

5.00 7 20.00

- 4 80.00
10.00
0 2 4 6 8
1 - 70.00
Proprietory - 2.00 4.00 6.00 8.00 10.00 1 2 3 4 5 6 7 1 2 3 4 5 6 7

18
 Gireesh Chandran .B

Projected Balance Sheet

Liabilities Year-1 Year-2 Year-3 Year-4 Year-5 Year-6 Year-7

Capital Account 4,05,000.00 6,27,600.00 9,00,900.00 12,17,800.00 15,83,000.00 20,17,700.00 24,58,200.00

Profit after tax 4,05,600.00 4,96,300.00 5,75,900.00 6,63,200.00 7,89,700.00 8,00,500.00 9,08,500.00
Drawings 1,83,000.00 2,23,000.00 2,59,000.00 2,98,000.00 3,55,000.00 3,60,000.00 4,09,000.00
Sub Total 6,27,600.00 9,00,900.00 12,17,800.00 15,83,000.00 20,17,700.00 24,58,200.00 29,57,700.00
Term Loan 9,43,400.00 8,79,900.00 8,08,600.00 7,28,800.00 6,39,300.00 5,38,900.00 4,26,400.00
Current Liabilities
Expenses Payable 20,000.00 22,000.00 23,000.00 25,000.00 27,000.00 28,000.00 30,000.00
Sundry Creditors 1,35,000.00 1,44,000.00 1,54,000.00 1,65,000.00 1,77,000.00 1,89,000.00 2,02,000.00
Other Current Liabilities 47,000.00 50,000.00 54,000.00 58,000.00 62,000.00 66,000.00 71,000.00
Total Current Liabilities 2,02,000.00 2,16,000.00 2,31,000.00 2,48,000.00 2,66,000.00 2,83,000.00 3,03,000.00
CREDIT TOTAL 17,73,000.00 19,96,800.00 22,57,400.00 25,59,800.00 29,23,000.00 32,80,100.00 36,87,100.00
Fixed Assets (As per Dep Statement) 9,94,000.00 8,94,000.00 8,05,000.00 7,25,000.00 6,53,000.00 5,87,000.00 5,28,000.00
Current Assets
Sundry Debtors 4,07,000.00 6,70,000.00 9,53,000.00 12,64,000.00 16,19,000.00 19,64,000.00 23,44,000.00
Other current assets and advances 50,000.00 50,000.00 50,000.00 50,000.00 50,000.00 50,000.00 50,000.00
Closing Stock 3,00,000.00 3,15,000.00 3,31,000.00 3,48,000.00 3,65,000.00 3,83,000.00 4,02,000.00
Cash and bank balances 22,000.00 67,800.00 1,18,400.00 1,72,800.00 2,36,000.00 2,96,100.00 3,63,100.00
Sub Total 7,79,000.00 11,02,800.00 14,52,400.00 18,34,800.00 22,70,000.00 26,93,100.00 31,59,100.00
DEBIT TOTAL 17,73,000.00 19,96,800.00 22,57,400.00 25,59,800.00 29,23,000.00 32,80,100.00 36,87,100.00
- - - - -
Cash Flow Statement
Year Year-1 Year-2 Year-3 Year-4 Year-5 Year-6 Year-7
Net Profit 4,05,600.00 4,96,300.00 5,75,900.00 6,63,200.00 7,89,700.00 8,00,500.00 9,08,500.00
Cash Flow from Operating Activities
Depreciation Expenses 1,11,000.00 1,00,000.00 89,000.00 80,000.00 72,000.00 66,000.00 59,000.00
Net (increase) Decrease in Stock (3,00,000.00) (15,000.00) (16,000.00) (17,000.00) (17,000.00) (18,000.00) (19,000.00)
Net (increase) Decrease in debtors (4,07,000.00) (2,63,000.00) (2,83,000.00) (3,11,000.00) (3,55,000.00) (3,45,000.00) (3,80,000.00)
Net (increase) Decrease in current assets (50,000.00) - - - - - -
Net increase (Decrease) in Creditors 1,35,000.00 9,000.00 10,000.00 11,000.00 12,000.00 12,000.00 13,000.00
Net Cash Flow from Operating Activities (5,11,000.00) (1,69,000.00) (2,00,000.00) (2,37,000.00) (2,88,000.00) (2,85,000.00) (3,27,000.00)
Cash Flow from Financing Activities
Net increase (Decrease) in Capital
Net increase (Decrease) in Capital 2,22,000.00 (2,23,000.00) (2,59,000.00) (2,98,000.00) (3,55,000.00) (3,60,000.00) (4,09,000.00)
Wokrin capital loan 20,000.00
Loan 9,43,400.00 (63,500.00) (71,300.00) (79,800.00) (89,500.00) (1,00,400.00) (1,12,500.00)
Wokrin capital loan 2,000.00 1,000.00 2,000.00 2,000.00 1,000.00 2,000.00
Net increase (Decrease) in Other Liabilites 47,000.00 3,000.00 4,000.00 4,000.00 4,000.00 4,000.00 5,000.00
Net Cash Flow from Financing Activities 12,32,400.00 (2,81,500.00) (3,25,300.00) (3,71,800.00) (4,38,500.00) (4,55,400.00) (5,14,500.00)
Cash Flow from Investment Activities
Net (increase) Decrease in Fixed Assets (11,05,000.00)
Opening Cash Balance 22,000.00 67,800.00 1,18,400.00 1,72,800.00 2,36,000.00 2,96,100.00
Closing Cash Balance 22,000.00 67,800.00 1,18,400.00 1,72,800.00 2,36,000.00 2,96,100.00 3,63,100.00
- - - - - - -

19
 Gireesh Chandran .B
Projected Profit and Loss Account
PARTICULARS Year-1 Year-2 Year-3 Year-4 Year-5 Year-6 Year-7
By Direct Income 3.00 3.00 3.00 3.00 3.00 3.00
" Revenue from operation 30,37,000.00 32,80,000.00 35,42,000.00 38,25,000.00 41,31,000.00 44,61,000.00 48,18,000.00
Closing Stock 3,00,000.00 3,15,000.00 3,31,000.00 3,48,000.00 3,65,000.00 3,83,000.00 4,02,000.00
Total 33,37,000.00 35,95,000.00 38,73,000.00 41,73,000.00 44,96,000.00 48,44,000.00 52,20,000.00
To Direct Expenses
" Opening stock 3,00,000.00 3,15,000.00 3,31,000.00 3,48,000.00 3,65,000.00 3,83,000.00
" Purchase 19,70,000.00 18,19,000.00 19,64,000.00 21,21,000.00 22,89,000.00 24,72,000.00 26,69,000.00
" Staff cost 4,80,000.00 4,94,000.00 5,09,000.00 5,24,000.00 5,40,000.00 5,56,000.00 5,73,000.00
" Consumables 8,000.00 8,000.00 8,000.00 8,000.00 8,000.00 8,000.00 8,000.00
" Electricity charges 68,000.00 70,000.00 72,000.00 74,000.00 76,000.00 78,000.00 80,000.00
" Repairs & Maintanance 8,000.00 8,000.00 8,000.00 8,000.00 8,000.00 8,000.00 8,000.00
" Office expenes 34,000.00 35,000.00 36,000.00 37,000.00 38,000.00 39,000.00 40,000.00
" Staff welfare exp 24,000.00 25,000.00 26,000.00 27,000.00 28,000.00 29,000.00 30,000.00
" Other direct expenses 26,000.00 27,000.00 28,000.00 29,000.00 30,000.00 31,000.00 32,000.00
Total 26,18,000.00 27,86,000.00 29,66,000.00 31,59,000.00 33,65,000.00 35,86,000.00 38,23,000.00
To Gross Profit 7,19,000.00 8,09,000.00 9,07,000.00 10,14,000.00 11,31,000.00 12,58,000.00 13,97,000.00
GP Ratio 23.67 24.66 25.61 26.51 27.38 28.20 29.00
To Indirect Expenses
" Marketing expenses 2,300.00 2,500.00 2,600.00 2,900.00 3,100.00 3,200.00 3,500.00
" Interest on term loan 1,12,100.00 1,05,200.00 97,500.00 88,900.00 79,200.00 68,300.00 56,000.00
" Other administratie exp 8,000.00 8,000.00 8,000.00 8,000.00 8,000.00 8,000.00 8,000.00
" Printing and stationary 26,000.00 27,000.00 28,000.00 29,000.00 30,000.00 31,000.00 32,000.00
" Repairs & Maintanance 23,000.00 24,000.00 25,000.00 26,000.00 27,000.00 28,000.00 29,000.00
" Travelling Expenses 31,000.00 32,000.00 33,000.00 34,000.00 35,000.00 36,000.00 37,000.00
" Depreciation 1,11,000.00 1,00,000.00 1,03,000.00 1,06,000.00 72,000.00 66,000.00 59,000.00
Total 3,13,400.00 2,98,700.00 2,97,100.00 2,94,800.00 2,54,300.00 2,40,500.00 2,24,500.00
Net Profit before tax 4,05,600.00 5,10,300.00 6,09,900.00 7,19,200.00 8,76,700.00 10,17,500.00 11,72,500.00
Income tax - 14,000.00 34,000.00 56,000.00 87,000.00 2,17,000.00 2,64,000.00
Net Icome After Tax 4,05,600.00 4,96,300.00 5,75,900.00 6,63,200.00 7,89,700.00 8,00,500.00 9,08,500.00
Net Icome After Tax % 13.36 15.13 16.26 17.34 19.12 17.94 18.86
Average NP ratio 16.86

Net Profit before tax

15,00,000.00

10,00,000.00

5,00,000.00

-
1 2 3 4 5 6 7

Net Profit before tax

14,00,000.00
12,00,000.00
10,00,000.00
8,00,000.00
6,00,000.00
4,00,000.00
2,00,000.00
-
1 2 3 4 5 6 7

20
 Gireesh Chandran .B

Term Loan Repayment Summary

ABSTRACT (Yearly)
Opening Closing
Inst Interest Principal
YEAR Balance Balance
1 10,00,000 1,68,715 1,12,076 56,638 9,43,362
2 9,43,362 1,68,715 1,05,208 63,506 8,79,856
3 8,79,856 1,68,715 97,508 71,207 8,08,649
4 8,08,649 1,68,715 88,873 79,841 7,28,808
5 7,28,808 1,68,715 79,192 89,523 6,39,285
6 6,39,285 1,68,715 68,336 1,00,378 5,38,907
7 5,38,907 1,68,715 56,165 1,12,550 4,26,357
8 4,26,357 1,68,715 42,517 1,26,198 3,00,159
9 3,00,159 1,68,715 27,214 1,41,500 1,58,659
10 1,58,659 1,68,715 10,056 1,58,659 0

Chart Title

- 20,000 40,000 60,000 80,000 1,00,000 1,20,000

Principal Interest

Chart Title
1,20,000

1,00,000

80,000

60,000

40,000

20,000

-
1 2 3 4 5

Interest Principal

21
 Gireesh Chandran .B
Depreciation Statement
% of
Particulars dep Year-1 Year-2 Year-3 Year-4 Year-5 Year-6 Year-7
Tools and Equipments 5,55,000.00 4,99,000.00 4,49,000.00 4,04,000.00 3,64,000.00 3,28,000.00 2,95,000.00
Depreciation 10% 56,000.00 50,000.00 45,000.00 40,000.00 36,000.00 33,000.00 30,000.00
WDV 4,99,000.00 4,49,000.00 4,04,000.00 3,64,000.00 3,28,000.00 2,95,000.00 2,65,000.00

Furniture and fixtures 1,50,000.00 1,35,000.00 1,21,000.00 1,09,000.00 98,000.00 88,000.00 79,000.00
Depreciation 10% 15,000.00 14,000.00 12,000.00 11,000.00 10,000.00 9,000.00 8,000.00
WDV 1,35,000.00 1,21,000.00 1,09,000.00 98,000.00 88,000.00 79,000.00 71,000.00

Electrical Fittings 4,00,000.00 3,60,000.00 3,24,000.00 2,92,000.00 2,63,000.00 2,37,000.00 2,13,000.00

Depreciation 10% 40,000.00 36,000.00 32,000.00 29,000.00 26,000.00 24,000.00 21,000.00
WDV 3,60,000.00 3,24,000.00 2,92,000.00 2,63,000.00 2,37,000.00 2,13,000.00 1,92,000.00
WDV Opening 11,05,000.00 9,94,000.00 8,94,000.00 8,05,000.00 7,25,000.00 6,53,000.00 5,87,000.00
Depreication Rounded 1,11,000.00 1,00,000.00 89,000.00 80,000.00 72,000.00 66,000.00 59,000.00
WDV Rounded 9,94,000.00 8,94,000.00 8,05,000.00 7,25,000.00 6,53,000.00 5,87,000.00 5,28,000.00

Chart Title
1200000
WDV Opening Depreication Rounded WDV Rounded
1000000

800000

600000

400000

200000

0
2 3 4 5 6 7 8

22
 Gireesh Chandran .B

The gross profit margin (also known as gross profit rate, or gross profit ratio) is a profitability measure that shows the percenta
of gross profit in comparison to sales. In other words, it calculates the ratio of profit left of sales after deducting cost
sales.Generally, the higher the gross profit margin the better. A high gross profit margin means that the company did well
managing its cost of sales. It also shows that the company has more to cover for operating, financing, and other costs. The
profit margin may be improved by increasing sales price or decreasing cost of sales. However, such measures may
negative effects such as decrease in sales volume due to increased prices, or lower product quality as a result of cutting
Nonetheless, the gross profit margin should be relatively stable except when there is significant change to the company
business model.

Year-1 Year-2 Year-3 Year-4 Year-5 Year-6 Year-7

Revenue from operation
30,37,000.00 32,80,000.00 35,42,000.00 38,25,000.00 41,31,000.00 44,61,000.00 48,18,000.00
Gross Profit 7,19,000.00 8,09,000.00 9,07,000.00 10,14,000.00 11,31,000.00 12,58,000.00 13,97,000.00
GP Ratio 23.67 24.66 25.61 26.51 27.38 28.20 29.00
Average 25.57

Chart Title
60,00,000.00

50,00,000.00

40,00,000.00

30,00,000.00

20,00,000.00

10,00,000.00

-
Year-1 Year-2 Year-3 Year-4 Year-5 Year-6 Year-7

Revenue from operation Gross Profit GP Ratio

23
 Gireesh Chandran .B

Debt Service Coverage Ratio

The Debt Service Coverage Ratio (DSCR) measures the ability of a company to use its operating income to
repay all its debt obligations, including repayment of principal and interest on both short-term and long-term
debt. This ratio is often used when a business has any borrowings on its balance sheet such as bonds, loans, or
lines of credit. It is also a commonly used ratio in a leveraged buyout transaction, to evaluate the debt capacity
of the target company. A debt service coverage ratio of 1 or above indicates that a company is generating
sufficient operating income to cover its annual debt and interest payments. As a general rule of thumb, an ideal
ratio is 2 or higher. A ratio that high suggests that the company is capable of taking on more debt.
Rather than just looking at an isolated number, it is better to consider a company’s debt service coverage ratio
relative to the ratio of other companies in the same sector. If a business has a significantly higher DSCR than
most of its competitors, that indicates superior debt management. A financial analyst may also want to look at a
company’s ratio over time – to see whether it is trending upward (improving) or downward (getting worse)

Ratio Analysis-DSCR
Financial Year Year-1 Year-2 Year-3 Year-4 Year-5 Year-6 Year-7
Net profit 4,05,600.00 5,10,300.00 6,09,900.00 7,19,200.00 8,76,700.00 10,17,500.00 11,72,500.00
Add: Depreciation 1,11,000.00 1,00,000.00 1,03,000.00 1,06,000.00 72,000.00 66,000.00 59,000.00
Total 5,16,600.00 6,10,300.00 7,12,900.00 8,25,200.00 9,48,700.00 10,83,500.00 12,31,500.00
Add: Interest on term Loan 1,12,100.00 1,05,200.00 97,500.00 88,900.00 79,200.00 68,300.00 56,000.00
Total 6,28,700.00 7,15,500.00 8,10,400.00 9,14,100.00 10,27,900.00 11,51,800.00 12,87,500.00
Annual Repayment 1,68,714.53 1,68,714.53 1,68,714.53 1,68,714.53 1,68,714.53 1,68,714.53 1,68,714.53
DSCR 3.73 4.24 4.80 5.42 6.09 6.83 7.63
Average DSCR 5.53

Chart Title

14,00,000.00

12,00,000.00

10,00,000.00

8,00,000.00

6,00,000.00

4,00,000.00

2,00,000.00

-
1 2 3 4 5 6 7
Net profit Annual Repayment

24
 Gireesh Chandran .B

Net profit ratio

Year Year-1 Year-2 Year-3 Year-4 Year-5 Year-6 Year-7

Profit 4,05,600.00 5,10,300.00 6,09,900.00 7,19,200.00 8,76,700.00 10,17,500.00 11,72,500.00

Sales 30,37,000.00 32,80,000.00 35,42,000.00 38,25,000.00 41,31,000.00 44,61,000.00 48,18,000.00
NP Ratio 13.36 15.56 17.22 18.80 21.22 22.81 24.34
Average 19.04

The average Net profitability ratio is 19.04 percent over the projected period of 5 years. It is
presumed that the same level of profitability will be there in the entity on a sustainable basis.

50,00,000.00
45,00,000.00
40,00,000.00
35,00,000.00
30,00,000.00
Profit
25,00,000.00
Sales
20,00,000.00
15,00,000.00
10,00,000.00
5,00,000.00
-
Year-1 Year-2 Year-3 Year-4 Year-5 Year-6 Year-7

Net Profit Margin

Net profit ratio establishes a relationship between net profit and sales and indicates and
management’s in manufacturing, administrating and selling the products. This ratio is the overall
measure of the firm’s ability to turn each rupee sales into net profit. If the net margin is inadequate
the firm will fail to achieve a satisfactory return on shareholders’ funds. This ratio also indicates the
firm’s capacity to withstand adverse economic conditions. A firm with high net margin ratio would
be an advantageous position to survive in the face of falling prices, selling prices, cost
production. Net profit is obtained when operating expenses; interest and taxes are subtracted from
the gross profit margin ratio is measured by dividing profit after tax by sales: This is a ratio between
the Net profit after tax and the turnover.

25
 Gireesh Chandran .B

Interest Coverage Ratio

The interest coverage ratio is a debt and profitability ratio used to determine how easily a company can pay interest on its
outstanding debt. The interest coverage ratio is calculated by dividing a company's earnings before interest and taxes (EBIT) by its
interest expense during a given period.

Year-1 Year-2 Year-3 Year-4 Year-5 Year-6 Year-7

Net profit 4,05,600.00 5,10,300.00 6,09,900.00 7,19,200.00 8,76,700.00 10,17,500.00 11,72,500.00

Depreciation 1,11,000.00 1,00,000.00 1,03,000.00 1,06,000.00 72,000.00 66,000.00 59,000.00

Interest 1,14,400.00 1,07,700.00 1,00,100.00 91,800.00 82,300.00 71,500.00 59,500.00
Total 2,25,400.00 2,07,700.00 2,03,100.00 1,97,800.00 1,54,300.00 1,37,500.00 1,18,500.00

EBIT 6,31,000.00 7,18,000.00 8,13,000.00 9,17,000.00 10,31,000.00 11,55,000.00 12,91,000.00

Interest 1,14,400.00 1,07,700.00 1,00,100.00 91,800.00 82,300.00 71,500.00 59,500.00

Interest coverage ratio 5.52 6.67 8.12 9.99 12.53 16.15 21.70

Chart Title
Interest coverage ratio
25.00

20.00

15.00

10.00

5.00

-
Interest coverage ratio

1 2 3 4 5 6 7 Series1 Series2 Series3 Series4 Series5 Series6 Series7

26
 Gireesh Chandran .B
Total Outside Liability to Total Net Worth (TOL/TNW)

TOL/TNW is a measure of a company’s financial leverage calculated by dividing the total liabilities of the company by the total net
worth of the business. Total outside liability is the sum of all the liabilities of the business and total net worth is the sum of share
capital and surplus reserves of the company. This ratio gives an accurate picture of the businesses reliance on debt. A low TOL/TNW
ratio signifies good levels of promoter’s stake in the business, whereas a high TOL/TNW ratio shows low levels of promoter’s stake in
the business, which is considered risky. In the rating exercise, businesses with a TOL/TNW of less than 1 score the maximum amount
of points while a TOL/TNW ratio of more than 3 is awarded no points. For most businesses, it would be good to have an average
TOL/TNW ratio in the range of 1-2.

Year-1 Year-2 Year-3 Year-4 Year-5 Year-6 Year-7

Adj. TNW 6,27,600.00 9,00,900.00 12,17,800.00 15,83,000.00 20,17,700.00 24,58,200.00 29,57,700.00
TOL 2,02,000.00 2,16,000.00 2,31,000.00 2,48,000.00 2,66,000.00 2,83,000.00 3,03,000.00
TOL/TNW 0.32 0.24 0.19 0.16 0.13 0.12 0.10
Average 0.18
Chart Title

30,00,000.00

25,00,000.00

20,00,000.00

15,00,000.00

10,00,000.00

5,00,000.00

-
Year-1 Year-2 Year-3 Year-4 Year-5 Year-6 Year-7

Adj. TNW TOL

TOL/TNW

1 2 3 4 5 6 7

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 Gireesh Chandran .B
Asset Coverage Ratio
Asset coverage ratio formula is calculated by subtracting the current liabilities less the short-term portion of long term debt from the totals
assets less intangibles and dividing the difference by the total debt

Year-1 Year-2 Year-3 Year-4 Year-5 Year-6 Year-7

Total Assets 17,73,000.00 19,96,800.00 22,57,400.00 25,59,800.00 29,23,000.00 32,80,100.00 36,87,100.00
Current Liabilites 1,82,000.00 1,94,000.00 2,08,000.00 2,23,000.00 2,39,000.00 2,55,000.00 2,73,000.00
Net Asset 15,91,000.00 18,02,800.00 20,49,400.00 23,36,800.00 26,84,000.00 30,25,100.00 34,14,100.00
Loan 9,63,400.00 9,01,900.00 8,31,600.00 7,53,800.00 6,66,300.00 5,66,900.00 4,56,400.00

Asset Coverage ratio 1.65 2.00 2.46 3.10 4.03 5.34 7.48

Asset Coverage ratio

8.00

7.00

6.00

5.00

4.00

3.00

2.00

1.00

-
1 2 3 4 5 6 7

Chart Title

Asset Coverage ratio

- 1.00 2.00 3.00 4.00 5.00 6.00 7.00 8.00

Series7 Series6 Series5 Series4 Series3 Series2 Series1

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 Gireesh Chandran .B

Break Even Analysis

Year-1 Year-2 Year-3 Year-4 Year-5 Year-6 Year-7
Sale 30,37,000.00 32,80,000.00 35,42,000.00 38,25,000.00 41,31,000.00 44,61,000.00 48,18,000.00
Total 30,37,000.00 32,80,000.00 35,42,000.00 38,25,000.00 41,31,000.00 44,61,000.00 48,18,000.00
Variable Cost
Cost of Goods / services 16,70,000.00 18,04,000.00 19,48,000.00 21,04,000.00 22,72,000.00 24,54,000.00 26,50,000.00
Consumables 8,000.00 8,000.00 8,000.00 8,000.00 8,000.00 8,000.00 8,000.00
Electricity charges 68,000.00 70,000.00 72,000.00 74,000.00 76,000.00 78,000.00 80,000.00
Repairs & Maintanance 8,000.00 8,000.00 8,000.00 8,000.00 8,000.00 8,000.00 8,000.00
Office expenes 34,000.00 35,000.00 36,000.00 37,000.00 38,000.00 39,000.00 40,000.00
Staff welfare exp 24,000.00 25,000.00 26,000.00 27,000.00 28,000.00 29,000.00 30,000.00
Other direct expenses 26,000.00 27,000.00 28,000.00 29,000.00 30,000.00 31,000.00 32,000.00
Total 18,38,000.00 19,77,000.00 21,26,000.00 22,87,000.00 24,60,000.00 26,47,000.00 28,48,000.00
Fixed Cost
Marketing expenses 2,300.00 2,500.00 2,600.00 2,900.00 3,100.00 3,200.00 3,500.00
Interest on term loan 1,12,100.00 1,05,200.00 97,500.00 88,900.00 79,200.00 68,300.00 56,000.00
Other administratie exp 8,000.00 8,000.00 8,000.00 8,000.00 8,000.00 8,000.00 8,000.00
Printing and stationary 26,000.00 27,000.00 28,000.00 29,000.00 30,000.00 31,000.00 32,000.00
Repairs & Maintanance 23,000.00 24,000.00 25,000.00 26,000.00 27,000.00 28,000.00 29,000.00
Purchase 4,80,000.00 4,94,000.00 5,09,000.00 5,24,000.00 5,40,000.00 5,56,000.00 5,73,000.00
Travelling Expenses 31,000.00 32,000.00 33,000.00 34,000.00 35,000.00 36,000.00 37,000.00
Depreciation 1,11,000.00 1,00,000.00 1,03,000.00 1,06,000.00 72,000.00 66,000.00 59,000.00
Total 7,93,400.00 7,92,700.00 8,06,100.00 8,18,800.00 7,94,300.00 7,96,500.00 7,97,500.00
Net Profit before tax 4,05,600.00 5,10,300.00 6,09,900.00 7,19,200.00 8,76,700.00 10,17,500.00 11,72,500.00
Contribuion 11,99,000.00 13,03,000.00 14,16,000.00 15,38,000.00 16,71,000.00 18,14,000.00 19,70,000.00
PV Ratio 39.48 39.73 39.98 40.21 40.45 40.66 40.89
Average PV Ratio 40.20
BEP in Rs 20,09,637.86 19,95,438.22 20,16,388.56 20,36,352.41 19,63,646.50 19,58,757.72 19,50,434.01
Average BEP in Rs 14,31,637.65
BEP in % 66% 61% 57% 53% 48% 44% 40%
Average BEP in % 53%
Breakeven point
Detailed break-even analysis is attached to the DPR. The breakeven chart is given below. The average breakeven point
calculation Schedule attached with this report details of the variable cost, fixed cost, sales, and contribution. The breakeven
chart is depicted below. The breakeven analysis determines at which sales volume your firm will start making money. The
Breakeven Formula is: fixed costs (costs that must be paid whether or not any units are produced) divided by variable costs
(costs that vary directly with the number of products produced, e.g. materials, labor used to produce units, percentage of
overhead).

Year-1 Year-2 Year-3 Year-4 Year-5 Year-6 Year-7

30,37,000.00 32,80,000.00 35,42,000.00 38,25,000.00 41,31,000.00 44,61,000.00 48,18,000.00
18,38,000.00 19,77,000.00 21,26,000.00 22,87,000.00 24,60,000.00 26,47,000.00 28,48,000.00
7,93,400.00 7,92,700.00 8,06,100.00 8,18,800.00 7,94,300.00 7,96,500.00 7,97,500.00
20,09,637.86 19,95,438.22 20,16,388.56 20,36,352.41 19,63,646.50 19,58,757.72 19,50,434.01

60,00,000.00

50,00,000.00

40,00,000.00
Sales
30,00,000.00 Variable cost
Fixed Cost
20,00,000.00
BEP
10,00,000.00

-
Year-1 Year-2 Year-3 Year-4 Year-5 Year-6 Year-7

29
 Gireesh Chandran .B

Current Assets Year-1 Year-2 Year-3 Year-4 Year-5 Year-6 Year-7

Other current assets and advances 50,000.00 50,000.00 50,000.00 50,000.00 50,000.00 50,000.00 50,000.00
Sundry Debtors 4,07,000.00 6,70,000.00 9,53,000.00 12,64,000.00 16,19,000.00 19,64,000.00 23,44,000.00
Closing Stock 3,00,000.00 3,15,000.00 3,31,000.00 3,48,000.00 3,65,000.00 3,83,000.00 4,02,000.00
Cash and bank balances 22,000.00 67,800.00 1,18,400.00 1,72,800.00 2,36,000.00 2,96,100.00 3,63,100.00
Total 7,79,000.00 11,02,800.00 14,52,400.00 18,34,800.00 22,70,000.00 26,93,100.00 31,59,100.00

Current Liabilities
Sundry Creditors 1,35,000.00 1,44,000.00 1,54,000.00 1,65,000.00 1,77,000.00 1,89,000.00 2,02,000.00
Other Current Liabilities 47,000.00 50,000.00 54,000.00 58,000.00 62,000.00 66,000.00 71,000.00
Expenses Payable 20,000.00 22,000.00 23,000.00 25,000.00 27,000.00 28,000.00 30,000.00
Total 2,02,000.00 2,16,000.00 2,31,000.00 2,48,000.00 2,66,000.00 2,83,000.00 3,03,000.00

Year-1 Year-2 Year-3 Year-4 Year-5 Year-6 Year-7

Cash Ratio 0.11 0.31 0.51 0.70 0.89 1.05 1.20
Average cash ratio 0.68

The cash ratio indicates to creditors, analysts, and investors the 1.40
Cash Ratio

percentage of a company’s current liabilities that cash and cash

1.20
equivalents will cover. A ratio above 1 means that a company
1.00
will be able to pay off its current liabilities with cash and cash
0.80
equivalents, and have funds left over.Creditors prefer a high
cash ratio, as it indicates that a company can easily pay off its 0.60

debt. Although there is no ideal figure, a ratio of not lower than 0.40

0.5 to 1 is usually preferred. The cash ratio figure provides the

0.20
most conservative insight into a company’s liquidity since only
-
cash and cash equivalents are taken into consideration. Year-1 Year-2 Year-3 Year-4 Year-5 Year-6 Year-7

Chart Title Cash Ratio

1.40 1.40

1.20 1.20
1.00
1.00
0.80
0.80
0.60

0.40 0.60

0.20 0.40

- 0.20
Cash Ratio
-
Series1 Series2 Series3 Series4 Series5 Series6 Series7
1 2 3 4 5 6 7

30
 Gireesh Chandran .B

Debt to equity ratio (also termed as debt equity ratio) is a long term solvency ratio that indicates the soundness of long-term financial
policies of a business It shows the relation between the portion of assets financed by creditors and the portion of assets financed by
stockholders

Year-1 Year-2 Year-3 Year-4 Year-5 Year-6 Year-7

Year-1 Year-2 Year-3 Year-4 Year-5 Year-6 Year-7
Capital 6,27,600.00 9,00,900.00 12,17,800.00 15,83,000.00 20,17,700.00 24,58,200.00 29,57,700.00
Total Liabilities 2,02,000.00 2,16,000.00 2,31,000.00 2,48,000.00 2,66,000.00 2,83,000.00 3,03,000.00
Year-1 Year-2 Year-3 Year-4 Year-5 Year-5 Year-5
Debt Equity Ratio 0.32 0.24 0.19 0.16 0.13 0.12 0.10
Average DE ratio 0.18

The Debt quity ratio of the business varied from 0.32 to 0.10
with an average of 0.18
Debt Equity Ratio
0.35
0.3
0.25
0.2
0.15
0.1
0.05
0
Year-1 Year-2 Year-3 Year-4 Year-5 Year-5 Year-5

Chart Title

3500000

3000000

2500000

2000000

1500000

1000000

500000

0
Year-1 Year-2 Year-3 Year-4 Year-5 Year-6 Year-7
Capital Total Liabilities

31
 Gireesh Chandran .B

This ratio shows the proportion of total assets of a buisiness which

are financed by proprietors’ funds. The proprietary ratio is also
known as equity ratio. It helps to determine the financial strength
of a business & is useful for creditors to assess the ratio of
shareholders’ funds employed out of total assets of the company.

Year-1 Year-2 Year-3 Year-4 Year-5 Year-6 Year-7

Capital 6,27,600.00 9,00,900.00 12,17,800.00 15,83,000.00 20,17,700.00 24,58,200.00 29,57,700.00
Total Assets 17,73,000.00 19,96,800.00 22,57,400.00 25,59,800.00 29,23,000.00 32,80,100.00 36,87,100.00
Year-1 Year-2 Year-3 Year-4 Year-5 Year-6 Year-7
Propritory Ratio 2.83 2.22 1.85 1.62 1.45 1.33 1.25
Average Proprietory ratio 1.79

The propritory ratio of the business varied from 2.83 to 1.25

with an average of 1.79

3 Propritory Ratio
2.5
2
1.5
1
0.5
0
Year-1 Year-2 Year-3 Year-4 Year-5 Year-6 Year-7

32
 Gireesh Chandran .B

Current Assets Year-1 Year-2 Year-3 Year-4 Year-5 Year-6 Year-7

Other current assets and advances 50,000.00 50,000.00 50,000.00 50,000.00 50,000.00 50,000.00 50,000.00
Sundry Debtors 4,07,000.00 6,70,000.00 9,53,000.00 12,64,000.00 16,19,000.00 19,64,000.00 23,44,000.00
Closing Stock 3,00,000.00 3,15,000.00 3,31,000.00 3,48,000.00 3,65,000.00 3,83,000.00 4,02,000.00
Cash and bank balances 22,000.00 67,800.00 1,18,400.00 1,72,800.00 2,36,000.00 2,96,100.00 3,63,100.00
Total 7,79,000.00 11,02,800.00 14,52,400.00 18,34,800.00 22,70,000.00 26,93,100.00 31,59,100.00
Quick assets (Current assets- cls stock) 4,79,000.00 7,87,800.00 11,21,400.00 14,86,800.00 19,05,000.00 23,10,100.00 27,57,100.00

Current Liabilities
Sundry Creditors 1,35,000.00 1,44,000.00 1,54,000.00 1,65,000.00 1,77,000.00 1,89,000.00 2,02,000.00
Other Current Liabilities 47,000.00 50,000.00 54,000.00 58,000.00 62,000.00 66,000.00 71,000.00
Loan 20,000.00 22,000.00 23,000.00 25,000.00 27,000.00 28,000.00 30,000.00
Total 2,02,000.00 2,16,000.00 2,31,000.00 2,48,000.00 2,66,000.00 2,83,000.00 3,03,000.00

Year-1 Year-2 Year-3 Year-4 Year-5 Year-6 Year-7

Quick Ratio 2.37 3.65 4.85 6.00 7.16 8.16 9.10
Average quick ratio 5.90

The Quick Ratio of the business varied from 2.37 to 9.10

with an average of 5.90
Quick Ratio

10.00

9.00

8.00

7.00

6.00

5.00

4.00

3.00

2.00

1.00

-
Year-1 Year-2 Year-3 Year-4 Year-5 Year-6 Year-7

33
 Gireesh Chandran .B

In above table shown the current ratio of five years . . The solvency position of the business in terms of
current ratio was above the standard norm volume of 2:1 for the entire period. Thecurrent Ratio
showsutilization of idle funds in the business

Year-1 Year-2 Year-3 Year-4 Year-5 Year-6 Year-7

Current liabilities 2,02,000.00 2,16,000.00 2,31,000.00 2,48,000.00 2,66,000.00 2,83,000.00 3,03,000.00
Curretn assets 7,79,000.00 11,02,800.00 14,52,400.00 18,34,800.00 22,70,000.00 26,93,100.00 31,59,100.00

Current ratio 3.86 5.11 6.29 7.40 8.53 9.52 10.43

Average CR 7.30

The Current Ratio Varied from 3.86 to 10.43 with an average

of 7.30 during the study period
Current ratio

12.00

10.00

8.00

6.00

4.00

2.00

Current ratio
12.00

10.00

8.00

6.00

4.00

2.00

-
1 2 3 4 5 6 7

34
 Gireesh Chandran .B
Current Ratio
Particulars Year-1 Year-2 Year-3 Year-4 Year-5 Year-6 Year-7
Current Ratio 3.86 5.11 6.29 7.40 8.53 9.52 10.43
Current Assets 7,79,000.00 11,02,800.00 14,52,400.00 18,34,800.00 22,70,000.00 26,93,100.00 31,59,100.00
Current Liabilites 2,02,000.00 2,16,000.00 2,31,000.00 2,48,000.00 2,66,000.00 2,83,000.00 3,03,000.00
Average Current ratio 7.30

Current Ratio:
The current ratio is calculated by dividing current assets by current liabilities.
Current assets include cash and other assets that can be converted into cash within a year, such as marketable securities, debtors, and
inventories. Prepaid expenses are also included in the current assets as they represent the payments that will not be made by the firm in the
future. All obligations maturing within a year are included in the current liabilities. Current liabilities include creditors, bills payable, accrued
expenses, short-term bank loans, income tax, liability, and long-term debt maturing in the current year.
The current ratio is a measure of a firm’s short-term solvency. It indicates the availability of current assets in rupees for every one rupee of
current liability. A ratio of greater than one means that the firm has more current assets than current claims against them Current liabilities.

Current Ratio
12.00

10.00

8.00

6.00

4.00

2.00

-
Year-1 Year-2 Year-3 Year-4 Year-5 Year-6 Year-7

35
 Gireesh Chandran .B

Operating Expense Ratio (OER)

Particulars Year-1 Year-2 Year-3 Year-4 Year-5 Year-6 Year-7
Operating Expense Ratio 26,31,400.00 27,69,700.00 29,32,100.00 31,05,800.00 32,54,300.00 34,43,500.00 36,45,500.00
Sales 30,37,000.00 32,80,000.00 35,42,000.00 38,25,000.00 41,31,000.00 44,61,000.00 48,18,000.00
OER 86.64 84.44 82.78 81.20 78.78 77.19 75.66

Sales
60,00,000.00

40,00,000.00

20,00,000.00

-
Year-1 Year-2 Year-3 Year-4 Year-5 Year-6 Year-7

Sales

Operating Expense Ratio:

The operating expense ratio explains the changes in the profit margin (EBIT to sales) ratio. This ratio is
computed by dividing operating expenses viz., cost of goods sold plus selling expense, and general and
administrative expenses (excluding interest) by sales.. Operating expenses are costs associated with running a
business's core operations on a daily basis. Thus, the lower a company's operating expenses are, the more
profitable it generally is. Over time, changes in the OER indicate whether the company can increase sales
without increasing operating expenses proportionately (i.e. if the business is scalable). In real estate,
companies can compare properties by using the ratio.

OER
88.00

86.00

84.00

82.00

80.00

78.00

76.00

74.00

72.00

70.00
1 2 3 4 5 6 7

36
 Gireesh Chandran .B

Loan rate Years Months

10,00,000.00 11.50% 10 120

Closing Opening Closing

Opening Balance Inst Interest principal Inst Interest principal
No Balance No Balance Balance
1 10,00,000.00 14,059.54 9,583.33 4,476.21 9,95,523.79 61 6,39,285.02 14,059.54 6,126.48 7,933.06 6,31,351.95
2 9,95,523.79 14,059.54 9,540.44 4,519.11 9,91,004.68 62 6,31,351.95 14,059.54 6,050.46 8,009.09 6,23,342.87
3 9,91,004.68 14,059.54 9,497.13 4,562.42 9,86,442.26 63 6,23,342.87 14,059.54 5,973.70 8,085.84 6,15,257.02
4 9,86,442.26 14,059.54 9,453.41 4,606.14 9,81,836.13 64 6,15,257.02 14,059.54 5,896.21 8,163.33 6,07,093.69
5 9,81,836.13 14,059.54 9,409.26 4,650.28 9,77,185.84 65 6,07,093.69 14,059.54 5,817.98 8,241.56 5,98,852.13
6 9,77,185.84 14,059.54 9,364.70 4,694.85 9,72,491.00 66 5,98,852.13 14,059.54 5,739.00 8,320.54 5,90,531.59
7 9,72,491.00 14,059.54 9,319.71 4,739.84 9,67,751.16 67 5,90,531.59 14,059.54 5,659.26 8,400.28 5,82,131.30
8 9,67,751.16 14,059.54 9,274.28 4,785.26 9,62,965.90 68 5,82,131.30 14,059.54 5,578.76 8,480.79 5,73,650.52
9 9,62,965.90 14,059.54 9,228.42 4,831.12 9,58,134.77 69 5,73,650.52 14,059.54 5,497.48 8,562.06 5,65,088.46
10 9,58,134.77 14,059.54 9,182.12 4,877.42 9,53,257.35 70 5,65,088.46 14,059.54 5,415.43 8,644.11 5,56,444.34
11 9,53,257.35 14,059.54 9,135.38 4,924.16 9,48,333.19 71 5,56,444.34 14,059.54 5,332.59 8,726.95 5,47,717.39
12 9,48,333.19 14,059.54 9,088.19 4,971.35 9,43,361.84 72 5,47,717.39 14,059.54 5,248.96 8,810.59 5,38,906.80
13 9,43,361.84 14,059.54 9,040.55 5,018.99 9,38,342.85 73 5,38,906.80 14,059.54 5,164.52 8,895.02 5,30,011.78
14 9,38,342.85 14,059.54 8,992.45 5,067.09 9,33,275.76 74 5,30,011.78 14,059.54 5,079.28 8,980.26 5,21,031.52
15 9,33,275.76 14,059.54 8,943.89 5,115.65 9,28,160.10 75 5,21,031.52 14,059.54 4,993.22 9,066.33 5,11,965.19
16 9,28,160.10 14,059.54 8,894.87 5,164.68 9,22,995.43 76 5,11,965.19 14,059.54 4,906.33 9,153.21 5,02,811.98
17 9,22,995.43 14,059.54 8,845.37 5,214.17 9,17,781.26 77 5,02,811.98 14,059.54 4,818.61 9,240.93 4,93,571.05
18 9,17,781.26 14,059.54 8,795.40 5,264.14 9,12,517.12 78 4,93,571.05 14,059.54 4,730.06 9,329.49 4,84,241.56
19 9,12,517.12 14,059.54 8,744.96 5,314.59 9,07,202.53 79 4,84,241.56 14,059.54 4,640.65 9,418.90 4,74,822.67
20 9,07,202.53 14,059.54 8,694.02 5,365.52 9,01,837.01 80 4,74,822.67 14,059.54 4,550.38 9,509.16 4,65,313.51
21 9,01,837.01 14,059.54 8,642.60 5,416.94 8,96,420.07 81 4,65,313.51 14,059.54 4,459.25 9,600.29 4,55,713.22
22 8,96,420.07 14,059.54 8,590.69 5,468.85 8,90,951.22 82 4,55,713.22 14,059.54 4,367.25 9,692.29 4,46,020.92
23 8,90,951.22 14,059.54 8,538.28 5,521.26 8,85,429.95 83 4,46,020.92 14,059.54 4,274.37 9,785.18 4,36,235.75
24 8,85,429.95 14,059.54 8,485.37 5,574.17 8,79,855.78 84 4,36,235.75 14,059.54 4,180.59 9,878.95 4,26,356.79
25 8,79,855.78 14,059.54 8,431.95 5,627.59 8,74,228.19 85 4,26,356.79 14,059.54 4,085.92 9,973.63 4,16,383.17
26 8,74,228.19 14,059.54 8,378.02 5,681.52 8,68,546.66 86 4,16,383.17 14,059.54 3,990.34 10,069.21 4,06,313.96
27 8,68,546.66 14,059.54 8,323.57 5,735.97 8,62,810.69 87 4,06,313.96 14,059.54 3,893.84 10,165.70 3,96,148.26
28 8,62,810.69 14,059.54 8,268.60 5,790.94 8,57,019.75 88 3,96,148.26 14,059.54 3,796.42 10,263.12 3,85,885.14
29 8,57,019.75 14,059.54 8,213.11 5,846.44 8,51,173.31 89 3,85,885.14 14,059.54 3,698.07 10,361.48 3,75,523.66
30 8,51,173.31 14,059.54 8,157.08 5,902.47 8,45,270.84 90 3,75,523.66 14,059.54 3,598.77 10,460.78 3,65,062.88
31 8,45,270.84 14,059.54 8,100.51 5,959.03 8,39,311.81 91 3,65,062.88 14,059.54 3,498.52 10,561.03 3,54,501.86
32 8,39,311.81 14,059.54 8,043.40 6,016.14 8,33,295.67 92 3,54,501.86 14,059.54 3,397.31 10,662.23 3,43,839.62
33 8,33,295.67 14,059.54 7,985.75 6,073.79 8,27,221.88 93 3,43,839.62 14,059.54 3,295.13 10,764.41 3,33,075.21
34 8,27,221.88 14,059.54 7,927.54 6,132.00 8,21,089.87 94 3,33,075.21 14,059.54 3,191.97 10,867.57 3,22,207.64
35 8,21,089.87 14,059.54 7,868.78 6,190.77 8,14,899.11 95 3,22,207.64 14,059.54 3,087.82 10,971.72 3,11,235.91
36 8,14,899.11 14,059.54 7,809.45 6,250.09 8,08,649.01 96 3,11,235.91 14,059.54 2,982.68 11,076.87 3,00,159.05
37 8,08,649.01 14,059.54 7,749.55 6,309.99 8,02,339.02 97 3,00,159.05 14,059.54 2,876.52 11,183.02 2,88,976.03
38 8,02,339.02 14,059.54 7,689.08 6,370.46 7,95,968.56 98 2,88,976.03 14,059.54 2,769.35 11,290.19 2,77,685.84
39 7,95,968.56 14,059.54 7,628.03 6,431.51 7,89,537.05 99 2,77,685.84 14,059.54 2,661.16 11,398.39 2,66,287.45
40 7,89,537.05 14,059.54 7,566.40 6,493.15 7,83,043.90 100 2,66,287.45 14,059.54 2,551.92 11,507.62 2,54,779.82
41 7,83,043.90 14,059.54 7,504.17 6,555.37 7,76,488.53 101 2,54,779.82 14,059.54 2,441.64 11,617.90 2,43,161.92
42 7,76,488.53 14,059.54 7,441.35 6,618.20 7,69,870.33 102 2,43,161.92 14,059.54 2,330.30 11,729.24 2,31,432.68
43 7,69,870.33 14,059.54 7,377.92 6,681.62 7,63,188.71 103 2,31,432.68 14,059.54 2,217.90 11,841.65 2,19,591.03
44 7,63,188.71 14,059.54 7,313.89 6,745.65 7,56,443.06 104 2,19,591.03 14,059.54 2,104.41 11,955.13 2,07,635.90
45 7,56,443.06 14,059.54 7,249.25 6,810.30 7,49,632.76 105 2,07,635.90 14,059.54 1,989.84 12,069.70 1,95,566.20
46 7,49,632.76 14,059.54 7,183.98 6,875.56 7,42,757.20 106 1,95,566.20 14,059.54 1,874.18 12,185.37 1,83,380.83
47 7,42,757.20 14,059.54 7,118.09 6,941.45 7,35,815.74 107 1,83,380.83 14,059.54 1,757.40 12,302.14 1,71,078.69
48 7,35,815.74 14,059.54 7,051.57 7,007.98 7,28,807.76 108 1,71,078.69 14,059.54 1,639.50 12,420.04 1,58,658.65
49 7,28,807.76 14,059.54 6,984.41 7,075.14 7,21,732.63 109 1,58,658.65 14,059.54 1,520.48 12,539.07 1,46,119.58
50 7,21,732.63 14,059.54 6,916.60 7,142.94 7,14,589.69 110 1,46,119.58 14,059.54 1,400.31 12,659.23 1,33,460.35
51 7,14,589.69 14,059.54 6,848.15 7,211.39 7,07,378.29 111 1,33,460.35 14,059.54 1,278.99 12,780.55 1,20,679.80
52 7,07,378.29 14,059.54 6,779.04 7,280.50 7,00,097.79 112 1,20,679.80 14,059.54 1,156.51 12,903.03 1,07,776.77
53 7,00,097.79 14,059.54 6,709.27 7,350.27 6,92,747.52 113 1,07,776.77 14,059.54 1,032.86 13,026.68 94,750.09
54 6,92,747.52 14,059.54 6,638.83 7,420.71 6,85,326.80 114 94,750.09 14,059.54 908.02 13,151.52 81,598.56
55 6,85,326.80 14,059.54 6,567.72 7,491.83 6,77,834.97 115 81,598.56 14,059.54 781.99 13,277.56 68,321.00
56 6,77,834.97 14,059.54 6,495.92 7,563.63 6,70,271.35 116 68,321.00 14,059.54 654.74 13,404.80 54,916.20
57 6,70,271.35 14,059.54 6,423.43 7,636.11 6,62,635.24 117 54,916.20 14,059.54 526.28 13,533.26 41,382.94
58 6,62,635.24 14,059.54 6,350.25 7,709.29 6,54,925.95 118 41,382.94 14,059.54 396.59 13,662.96 27,719.98
59 6,54,925.95 14,059.54 6,276.37 7,783.17 6,47,142.78 119 27,719.98 14,059.54 265.65 13,793.89 13,926.09
60 6,47,142.78 14,059.54 6,201.78 7,857.76 6,39,285.02 120 13,926.09 14,059.54 133.46 13,926.09 (0.00)

37
 Gireesh Chandran .B
Calulation of NPV and IRR
Opportunity Cost 10%
Year Cash Flow Present Value
0 (14,05,000.00) (14,05,000.00)
1 5,16,600.00 4,69,636.36
2 6,10,300.00 5,04,380.17
3 7,12,900.00 5,35,612.32
4 8,25,200.00 5,63,622.70
5 9,48,700.00 5,89,068.06
6 10,83,500.00 6,11,607.50
7 12,31,500.00 6,31,954.22
Net Present Value 25,00,881.34
IRR 45.592167%
-
Chart Title
40,00,000.00

20,00,000.00

-
0 1 2 3 4 5 6 7
(20,00,000.00)

(40,00,000.00)

Cash Flow Present Value

Net Present Value (NPV)

Net present value (NPV) is the difference between the present value of cash
inflows and the present value of cash outflows over a period of time. NPV is used
in capital budgeting and investment planning to analyze the profitability of a
projected investment or project. A positive net present value indicates that the
projected earnings generated by a project or investment - in present dollars -
exceed the anticipated costs, also in present dollars. It is assumed that an
investment with a positive NPV will be profitable, and an investment with a
negative NPV will result in a net loss. This concept is the basis for the Net
Present Value Rule, which dictates that only investments with positive NPV

values should be considered.

Internal Rate of Return (IRR)
Internal rate of return (IRR) is the interest rate at which the net present value
of all the cash flows (both positive and negative) from a project or investment
equals zero. The internal rate of return is used to evaluate the attractiveness of a
project or investment. If the IRR of a new project exceeds a company’s required
rate of return, that project is desirable. If IRR falls below the required rate of
return, the project should be rejected. Typically, the higher the IRR, the higher the
rate of cash inflow a company can expect from a project or investment.

38
 Gireesh Chandran .B

Conclusion
On revealing the various aspects of the project and studying the financial & technical
features of the scheme it can easily be noted that the above project will be a great success. This
Project viewed from any angle will find a viable and justifiable outlook. There are no hidden
anomalies or expenses in the Project. The Term Loan proposed to avail and can be repaid with
interest from the income derived from the business itself. This Project is recommended for
implementation. Considering the fair quality of services and products offered by the
establishment and further the prior experience, knowledge, technical expertise, and
commitment of the promoters are added advantages for the smooth running of the project.
The income generated, with the experience, expertise, and commitment of the promoter
ensures the success of the project. Even the conservative estimates show that the project is
financially and economically viable and commercially sound. Considering the fair quality of
services and products offered by the establishment and further the prior experience,
knowledge, technical expertise, and commitment of the promoters are added advantages for
the smooth running of the project. The income generated, with the experience, expertise, and
commitment of the promoter ensures the success of the project. The various projected
financial statements and Debt Service Coverage Ratio DSCR, Return on Investment ROI, Pay
Back Period, etc. show that the project will be able to repay the entire Bank Loan together with
interest within the stipulated period and further shows that the project is financially sound
and deserve support and help from the Bank.
The various projected financial statements and Debt Service Coverage Ratio (DSCR),
Return on Investment (ROI), Pay Back Period, etc. show that the project will be able to repay
the entire Bank Loan together with interest within the stipulated period and further shows
that the project is financially sound and deserve support and help from the Bank.

39