RAJASTHAN AGRICULTURAL COMPETITIVENESS PROJECT
Detailed Project Report on Barley Sattu Processing
Prepared by:
AGRI BUSINESS PROMOTION FACILITY
Table of Contents
List of Figures 2 List of Table 3 Chapter 1-Introduction of Barley 4 Chapter 2- Barley Processing in India 12 Chapter 3-Technical Process Flow 18 Chapter 4- Technology Options Available 22
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List of Figures
Figure 1: Barley producing states ...... 9 Figure 2: Major barley producing districts in state...... 11 Figure 3: Barley sattu & drink ...... 13 Figure 4: Supply chain of barley sattu in india ...... 17 Figure 5: Manual barley sattu processing flow ...... 18 Figure 6 Semi-Automatic Barley Processing Flow ...... 20
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List of Table
Table 1:Major barley producing countries ...... 6 Table 2: Barley Production in India (2006-16) ...... 6 Table 3: State Wise Barley Production (‘000 MT) ...... 7 Table 4: Percentage share of states in barley production ...... 9 Table 5: Major barley producing districts in state ...... 10 Table 6: Nutritional value of sattu ...... 16 Table 7: Captive Model ...... 22 Table 8: Assumptions for Operating Capacity utilization ...... 22 Table 9: Project Cost Summary ...... 23 Table 10: Means of Finance Summary ...... 23 Table 11: Plant and Machinery ...... 23 Table 12: Assumptions about capacity utilization ...... 24 Table 13: Cost Structure Assumptions ...... 24 Table 14: Revenue Schedule ...... 25 Table 15: P&L Statement ...... 26 Table 16: Balance Sheet ...... 27 Table 17: Key Financial Indicators ...... 28
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Chapter 1-Introduction of Barley
The exact origin of barley is debatable, possibly originating in Egypt, Ethiopia, the Near East or Tibet. However, it is fairly certain that barley was among the earliest cultivated grains, around the same time as domestication of wheat. Barley was grown in the Middle East prior to 10,000 BC (6, 12, 13), but barley's cultivation in China and India probably occurred later. Barley was grown on the Korean Peninsula by 1500-850 BC along with millet and wheat.
Barley is a rich source of nutrients like protein, B vitamins, niacin, dietary minerals, and dietary fibre. The grain is a particularly good source of manganese and phosphorus. Raw barley is 78% carbohydrate, 10% protein, 10% water, and 1% fat. De-hulled barley is used to prepare a number of food items like flour, flakes, grits, etc. Barley in these forms can be used to make porridge, gruel, and a wide variety of other dishes in Central and Eastern Europe. In Saudi Arabia, people consume barley soup during Ramadan. Several other recipes in the Middle East like the murri, kashk, and kashkak use barley.
Research suggests that barley consumption is beneficial in several ways. It reduces cholesterol levels in the blood, improves the regulation of blood sugar, and has other health benefits too. However, since barley contains gluten, it is not recommended for people with gluten-related disorders. Barley is also extensively used in beer and whiskey production. Non- alcoholic beverages like barley water and barley roasted tea are also produced from barley. In the US, half of the barley produced is used to feed livestock. Barley is also the principal feed grain in Canada, Europe, and the northern US. Barley is also used as an algicide in England where barley straw is placed in mesh bags and floated in fish ponds to curb algal growth in a natural manner. Other ornamental and cultural uses of barley are also found.
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Major use of barley as a crop are mentioned below:
•Barley, being a good source of protein, is used as a feed for the livestock. For use as an animal feed, it is rolled, grounded, flaked or pelleted. These products Animal Feed are given in the form of grain, silage or straw to dairy and beef cattle.The byproducts of malted barley are also used in the form of animal feed.
•A wide variety of barley products are known to be suitable for human consumption.These include Human porridge, muesli and cookies made of barley flakes, Consumption cereals made of barley bran, and muffins, cookies, breads and pasta made of barley flour.
•Barley is malted for use in alcoholic beverages like beer and wine. Apart from this, the malted barley is Malted Barley also used as flavour, sweetener, malt extract, malt flour,etc.
•Apart from being used as an eatable, barley is used in fields like industries and agriculture. The barley straw is used to make the bed for the livestock, while Other Uses bales of barley are used in making paper, fiberboard, etc. The starch present in barley is used in making paper, paper starch based detergents, biodegradable plastics, etc.
Barley is a hearty plant, able to withstand many different growing conditions. However, it is least tolerant of hot, humid conditions, which makes it unsuitable for the subtropical regions.
There are two basic types, based on the number of rows of grain seen when the heads of the stalks are viewed from above:
1. Two-row barley, because there are two rows of barley kernels on the head of the stalk. Each stalk produces between 15 and 30 kernels.
2. Six-row barley, because the head of the stalk contains six rows of barley kernels. Each stalk produces between 25 and 60 kernels.
1.1 Global scenario – Barley
Barley is one of the most popular crops and it is clear from the fact that it is grown in over 100 countries of the world. While barley production has fluctuated globally, there has been no clear rising or falling trend.
In 2014, 144 million tons of barley was produced of which 14% was produced by the Russian Federation, the top producing country. France and Germany ranked second and third in barley production in the same year. In 2016, The European Union holds first rank in production of Barley
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(59,744 MT) with about 41% share of the total world production followed by Russian Federation (14%), Australia (7%), Ukraine (7%) and Canada (6%). India ranks fourteenth in the production of barley with 1% share.
Russian Federation was the major producer of Barley in the year 2013 with an annual production of 1,53,88,704 MT which contributes to 10.56% of the total share. Germany is next to Russian federation with an annual production of 1,03,43,600 MT. France, Canada, Spain and Turkey are some of the major producers of barley in the world.
Table 1:Major barley producing countries
S. No. Country Production ( In MT) Share(%)
1 Russian Federation 1,53,88,704 10.56
2 Germany 1,03,43,600 7.1
3 France 1,03,15,900 7.08
4 Canada 1,02,37,100 7.03
5 Spain 1,00,57,600 6.9
6 Turkey 79,00,000 5.42
7 Ukraine 75,61,650 5.19
8 Australia 74,71,592 5.13
9 United Kingdom 70,92,000 4.87
10 Argentina 47,05,160 3.23
Total 9,10,73,306 62.51
Source: USDA
1.2 Indian Scenario - Barley
In India, barley is one of the most widely cultivated cereal grain crops. This is cultivated as a summer crop in temperature regions and as a winter crop in tropical regions. Barley is a short growing season crop and has good drought tolerant. Production of Barley India for the last ten years is presented in the table below:
Table 2: Barley Production in India (2006-16)
Market Year Production (‘000 MT) Growth Rate
Y2006 1221 1.16%
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Y2007 1328 8.76%
Y2008 1196 -9.94%
Y2009 1689 41.22%
Y2010 1355 -19.78%
Y2011 1663 22.73%
Y2012 1619 -2.65%
Y2013 1752 8.21%
Y2014 1831 4.51%
Y2015 1613 -11.91%
Y2016 1510 -6.39%
The trend shows a mixed result with the production figures fluctuating around 1600 thousand MT since 2009. The reason possibly being the direct competition of barley with Wheat and Mustard in north India. Also good rainfall during 2015-16 and 2016-17 also boosted production of wheat and mustard and hence overall production of barley is negative in last two years. The major producing states of Barley in India are Rajasthan, Uttar Pradesh, Madhya Pradesh, Haryana, Punjab and West Bengal. Barley is grown for many purposes, but the majority of all barley is used for animal feed or malting.
Table 3: State Wise Barley Production (‘000 MT)
State 2009-10 2010-11 2011-12 2012-13
Rajasthan 619.80 954.80 789.15 852.58
Uttar Pradesh 362.00 333.56 404.00 446.00
Haryana 137.00 129.00 153.00 167.00
Madhya Pradesh 110.00 103.00 138.30 144.92
Punjab 47.00 44.00 47.00 47.00
Himachal Pradesh 16.20 27.74 30.39 36.25
Uttarakhand 26.00 30.10 28.00 30.73
Bihar 12.90 25.10 16.69 15.23
Jammu & Kashmir 7.86 8.67 4.20 6.95
West Bengal 2.40 2.80 3.34 3.50
Others 13.50 4.10 4.58 2.29
All India 1354.66 1662.87 1618.65 1752.45
Source: Ministry of Agriculture
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Himachal Pradesh
Punjab Uttarakhand
Haryana
Rajasthan Uttar Pradesh
Madhya Pradesh
Figure 1: Barley producing states
Source : http://agricoop.gov.in
Table 4: Percentage share of states in barley production
States % share of Area Coverage % share of Production
Rajasthan 30 40
Uttar Pradesh 34 31
Madhya Pradesh 12 9
Others 24 20
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1.3 Rajasthan Scenario – Barley
Over half of the barley grown in the state is of two-row variety, which is processed into barley flour and blended with wheat flour to make flat bread. The crop residue is used as animal feed by farmers. Due to extensive usage of corn as food, very small quantity of barley is used in feed manufacturing industry in India.
The spot prices for barley in the Jaipur market in India have increased by 33.41% over 2016-17 from that of 2015-16. The average price of barley in May 2016 was Rs 1131.6 per quintal.
The major producing districts of Barley in Rajasthan are Jaipur, Ganganagar, Sikar, Ajmer and Hanumangarh. Jaipur is the top barley producing district in the state having (180,062 MT) production. The top 5 Barley producing districts in Rajasthan are given below:
Table 5: Major barley producing districts in state
Districts Production (In MT)
Jaipur 180,062
Ganga Nagar 124,436
Sikar 101,505
Ajmer 43,542
Hanumangarh 38,569
State 766,379
Top districts in Rajasthan which Produces barley are mentioned below in the diagram
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Ganganagar Hanumangarh
Sikar
Jaipur
Ajmer
Figure 2: Major barley producing districts in state
Source: http://www.agriculture.rajasthan.gov.in
The district having the highest production of barley is Jaipur which is 180 Thousand MT.
1.4 Cluster Scenario: Production
Cluster Area (Ha) Production Marketable Value of (MT) surplus (MT) @ surplus (Rs 80% lakh)
Bansur 368 1349 1079 151
Dooni 314 471 377 53
Z Distributary 1929 5854 4683 656
Mokhampura 160 453 362 51
Total 2771 8127 6502 911 The total area under Barley crop in major value chain cluster areas is 2771 Ha and the total estimated production in 2016-17 was 8127 MT. Out of this, marketable surplus is calculated at 80% of the total production and the value of marketable surplus is calculated to be around 911 lacs in the corresponding period.
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Chapter 2- Barley Processing in India
Barley is widely used for food and fodder. Major uses of barley are in the beer industry, food processing and feed manufacturing industries. With the rising demand for beer, the demand for barley is also picking up. Also, more than 90% of the world malt production comes from barley.
In food industry barley is used in making of various value added products for human consumption such as - porridge, muesli and cookies made of barley flakes, cereals made of Barley bran, and muffins, cookies, breads and pasta made of barley flour.
Barley can be categorised broadly into 4 types. They are utilized in a variety of ways mentioned in the below diagram:
Feed Barley • Livestock and Poultry
Pearl Barley • Soups & dressing flour
Milling Barley • Sattu, Grits, Baby foods & biscuits
Malt Barley • Beer, Spirits, Health tonics, Malt Milk etc
Barley processing industry for human consumption is dominated by a single processing technique i.e.- Malting, which gives Beer, Spirit etc as end product for human consumption. Malting is a controlled germination that converts raw grain into malt. Apart from malting of barley, barley milling technique is second most prevalent processing technique to get various edible product for human consumption and one of those end product is – Sattu.
2.1 Product profile: Barley Sattu
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Sattu is an age old remedy to beat the heat in India. Made after powdering roasted chick peas, gram flour (sattu) is immensely popular in the Indian states of Bihar, Punjab, Madhya Pradesh, UP and West Bengal. The health benefits are such that it is popularly called – “desi horlicks’’. Once a rural delicacy, sattu has gradually caught the fancy of urban India. With rising popularity, sattu has now evolved to include nutritious flours like barley, wheat etc. It is consumed in various forms starting from a simple drink to paranthas, laddoos, litti chokhas, etc. Traditionally, sattu is served during summers as a nutritious drink that has cooling effects on the body.
Figure 3: Barley sattu & drink
Sattu shall be derived from clean, washed, dried and sound grains of barley (Hordeum vulgare or Hordeum distichon) after grinding of roasted and puffed barley grains. Sattu shall be of white or white to light yellowish color. It shall be of uniform color and size; having characteristic taste, smell and flavor associated with the product; free from insect infestations, live insect, dead insects, insect fragments, mould or mites, and larvae; free from rodent hair and excreta; free from fermented and musty odor, rancidity or any objectionable odor; free from dirt, extraneous matter (including added colors) or any other adulterants; free from any fungal or bacterial contamination; and free from preservatives, flavoring agents and other food additives. ‘Sattu’ is a roasted flour mixture of cereal and pulse combination and used as ‘ready -to-eat’ snack food in most parts of India. It is a convenient and inexpensive food product, containing digestive and dietary constituents or principles of vital importance
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Owing to its high nutritional value, long shelf life and excellent taste, sattu is popular supplement food especially in rural India.
Bengal gram sattu is commercially produced in Bihar and eastern Uttar Pradesh, which is the most liked form of sattu but in other parts of Uttar Pradesh, barley and bengal gram based sattu is preferred by the population. Earlier sattu was considered as food of the poor but now a day, it is gaining popularity amongst all because of its protein value and suitability of this product for diabetics due to lower glycemic index of Bengal gram and barley (Shukla et al., 1991).
Market Segmentation of Barley Sattu is shown below:
Barley Sattu Market
By Distribution By Product Type By Region Channel
Bihar Plain Super Market & Hyper market
Jharkhand Flavored Specialty Food Stores
Uttar Pradesh Convenience & Grocery Stores
Online
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2.2 Benefits of Barley / Barley Sattu consumption
Barley contains many phenolic compounds in the free and bound form including benzoic and cinnamic acid derivatives, 2 Introduction proanthocyanidins, quinines, flavonols, chalcones, flavones, flavanones, and amino phenolic compounds which are concentrated in the outer layers of the barley grain (Goupy et al., 1999). Recent findings revealed that cereals also contain phenolic compounds that have antioxidant activity and prevent diseases in humans (Madhujith and Shahidi, 2007). The risk imposed by the consumption of free radicals and oxidation products towards various forms of cancer and cardiovascular disease could be lowered by the intake of dietary phenolics. The natural antioxidants in cereals may function as reducing agents, free radical scavengers, single oxygen quencher and potential complexer of prooxidants (Sharma et al., 2012). Therefore, the consumption of barley should be encouraged as a human food.
Sattu has amazing health benefits when consumed on an empty stomach. It reduces problems associated with your stomach and flushes out the toxins from the body. Sattu has cooling properties and is great in providing relief from the scorching heat. It is rich in several nutrients including fibre, iron, magnesium and sodium. Not just this, there are many other health benefits of sattu, some of them include: –
1. Improves bowel movement - Consuming sattu on an empty stomach improves the digestive tract. It has salt, iron and fibre, which reduces the problem associated with stomach and improves the bowel movement.
2. Flushes out toxins - Sattu has detoxifying properties. Consuming it every day keeps you healthy and protects you from several health ailments.
3. Increases appetite - Consuming sattu sharbat on an empty stomach increases appetite. This happens due to the presence of potassium and magnesium in it.
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4. Helps in weight loss - Sattu reduces bloating, increases metabolism and helps your body burn calories effectively.
5. Increases energy - When consumed on an empty stomach, sattu stimulates the growth of the red blood cells in the body. When your body has more red blood cells, your body gets more oxygen, which provides you with more energy throughout the day.
6. Acts as coolant - Sattu keeps your body hydrated and helps you beat the summer heat. A chilled glass of sattu sharbat keeps you fresh and hydrated throughout the day. It cools the stomach and prevents indigestion.
7. Good for people with diabetes and high BP - Sattu is a natural blood pressure regulator. It is low in glycemic index therefore; it can benefit people with diabetes. Have sattu every day to control your blood sugar level.
Table 6: Nutritional value of sattu
Nutritional value of Sattu (per 100 gm) Protein 20.60% Fat 7.20% Crude Fiber 1.35% Carbohydrates 65.20% Total Ash 2.70% Moisture 2.95% Calories 406 Kilo Joules
Once touted as poor man’s protein, Sattu is now turning into super nutritional ready to eat food and major factors driving the demand of barley sattu are growing urbanisation, rise in disposable incomes and rapidly changing lifestyles. There is no major brand of barley sattu however there are many small players who are selling packaged sattu in under various brand names and can be also brought online.
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2.3 Indian Scenario
Indian barley processing industry has emerged fast due to economic liberalization coupled with growing urbanization, expanding market options and development of indigenous processing varieties.
Processing has helped to reduce the post-harvest losses and it not only result in economic gains to the farmers but also provide better food and nutritional security to the country. Keeping in view, the future demand of raw material for processing in India and utilization of more barley produce towards value addition, varieties having good yield potential are required.
The barley supply chain in India has a manoeuvring aspect which has a strong integration. Companies developing suitable varieties of barley such as Ab in Bev, Souflet etc for the future barley processing potential in India.
Various stages of supply chain in the process of barley sattu, from the farmers to the consumers is explained below in the given diagram:
Figure 4: Supply chain of barley sattu in india
Manufacture Farmers Collectors rs
End- consumers Retailers Distributors / Exporters
The main consumers of barley sattu are families especially in rural and semi-urban areas. Apart from in house consumption, some hotels, restaurants, canteens mostly in Bihar, Jharkhand and UP require barley sattu in significant quantities for the preparation of different local delicacies such as – litti, sattu paratha etc.
However, due to the rising health consciousness among urban population, urban consumption of sattu is rising and expected to grow further.
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Chapter 3-Technical Process Flow
3.1. Barley Sattu Processing The processing of Barley Sattu Processing is differentiating with two different models
1. Manual barley sattu processing 2. Semi-automatic barley sattu processing
Manual processing of barley sattu is very common in rural area, where people process barley sattu mainly for their own consumption. In manual processing of barley everything is done with almost no mechanical intervention. Barley grains are first cleaned and then roasted for few minutes in heating sand and then a hand grinder, a traditional grinding stone – Jatta, is used to grind roasted barley grains. Finally, a mesh strainer, commonly known as sieve, is used to obtain fine powder like product which is known as – Barley Sattu. Sattu is then packed in an air tight jar and stored in cool and dry place.
Figure 5: Manual barley sattu processing flow
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In the case of semi-automatic processing, minimal human intervention is required which in turn shortens the processing time with much higher efficiency. A semi-automatic manufacturing process flow of barley sattu is represented below -
Grain Cleaning
Roasting
De-Husking
Pulverizing
Sieving
Packaging
Roasting
Roasting is a simple and convenient process that uses dry heat for short periods of time for improving grain characteristics. Roasting also improves colour, extends shelf life, enhances flavor and reduces the antinutrient factors of cereals and legumes. Moreover, roasting of grains leads to the gelatinization of starch and denaturation of proteins thus improving their digestibility. Roasting of 5 minutes is best suited.
De-Husking
The roasted barley passes through dehusker which separates husk from the barley grain. A dehulling efficiency (DE) of about 75% for barley gave dehulling yield (DY) of 92% with acceptable product.
Pulverizing
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Roasted and dehusked barley grains will pass through the pulverizer which will grind grains into dust particles.
Sieving
Sieving is a method of separation of particles from a mixture based on the difference in size of particles. It uses sieve plates for separation of coarse particles from finer particles. Sieve plates have meshed or perforated bottoms which allow only particles of a specific size to pass through it. Grinded barley particles pass through sieving machine, separated powder is the final product which is known as Barley Sattu.
Packaging
Packaging is last but one of the most crucial activity as it not only segregates product in different SKUs but also determines the shelf life of the product. Barley Sattu gets into packaging machine which gets packed in air tight containers in different SKUs sizes – 250 gms, 500 gm and 1 kg.
Cleaned Barley Grains Roasting Machine De-Husking Machine
Sattu Packing Machine Sieving Machine Pulveriser
Figure 6 Semi-Automatic Barley Processing Flow
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3.2. Quality Control Taste samples are made from each batch throughout the manufacturing process, usually at a rate of once per hour. The tasters check the chips for salt, seasoning, moisture, colour, and overall flavour. Colour is compared to charts that show acceptable chip colours.
3.3. Quality Standards
Following specifications under Bureau of Indian Standard related to processing of such products may be referred:
IS: 4626-1978
IS: 2860-1964
IS: 7254-1974 6.2.
FSSAI License: FSSAI License is issued by the Food Safety and Standards Authority of India (FSSAI), Ministry of Family Health & Welfare, Government of India. Application to commence a food business must be made to the FSSAI in the prescribed format. Based on the application and supporting documents, FSSAI will accord approval. The Food Safety and Standards (Licensing and Registration of Food Businesses) Regulations 2011introduced to improve the hygiene and quality of food has brought about tremendous changes in the food industry. As per the Act, no person shall commence or carry on any food business except under a FSSAI license or FSSAI registration. Therefore, any food manufacturing or processing or packaging or distributing entity is now required to obtain a FSSAI License or Registration.
Pollution Control: There is no major pollution problem associated with this project in terms of air and sound pollution except for disposal of waste water which would be managed appropriately through recycling facility. However, entrepreneur should obtain NOC from concerned State Pollution Control Board.
Effluent Disposal: Disposal of any effluent out of the project unit should be treated with recycling facility or dumped in such a way that these does not cause hazard in the vicinity of the site.
Energy Conservation: Proper care should be taken in order to use appropriate amount of fuel and electricity.
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Chapter 4- Technology Options Available We propose the technology options which would require a moderate as compared to setting up other processing plants. This technology option includes a line of semi-automatic machines which will have an output capacity of 75 kg of barley sattu per hour.
4.1 Barley Sattu Processing (Semi-Automatic)
Business Assumption: The business plan has assumed that the business model operates under Captive Mode.
The Captive Model involves direct selling of Barley Sattu in the market after processing the raw barley barley grains.
The assumptions for the line of processing of barley under Captive Model is given below:
Table 7: Captive Model
Business Case – Year 1 Year 2 Year 3 Year 4 Year 5 Assumptions Captive Trading 0 100% 100% 100% 100% The assumptions for the line of barley processing for Operating Capacity utilization is given below.
Table 8: Assumptions for Operating Capacity utilization
Business Case – Year 1 Year 2 Year 3 Year 4 Year 5 Assumptions Operating Capacity 50% 55% 65% 75% 85%
4.1.1. Project Cost The total cost of the project is estimated at Rs.24.04 Lakhs, out of which civil cost constitutes Rs 1 Lakhs, plant and machinery constitutes Rs.11.40 Lakhs, Furniture of Rs. 0.50 Lakh, IT & Infrastructure constitutes Rs. 0.50 Lakh, Preliminary & pre-operating expenses of Rs. 0.25 Lakhs and requirement of working capital would be of approx Rs. 1.40 lakh. The detailed description of each component of project cost is depicted in the tables below.
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Table 9: Project Cost Summary
Project Cost (In RS lakh) Year 1
Civil Cost 1,000,000 Plant & Machinery 1,140,000
Furniture & Fixture 50,000
IT & Infrastructure 50,000
Preliminary & Pre-operative expenses 25,000
Working Capital 139,585 Total Project Cost 2,404,585 Note: We have not considered the land cost in this business model 4.1.2. Proposed Means of Finance The promoter’s equity in the project is Rs 7.05 Lakhs which is 29% per cent of the total project cost. The term loan considered for the project is estimated at Rs. 16.98 Lakhs which is 71% of the total project cost.
Table 10: Means of Finance Summary
Means of Finance (Rs. lakh) Amount (Rs.) Total Project Cost 2,404,585 Funding Equity (Promoters Cost) 705,835 Debt 1,698,750 Total Funding Required 2,404,585 Note: We have not considered grant in aid being offered by National Horticulture Board or any other government entity/ institutions. Which may have an impact on the overall profitability of the project in a positive way. 4.1.3. Plant and Machinery The total cost of plant and machinery has been arrived on the basis of quotation received from various suppliers of equipment and machinery. The total cost of P&M is considered as Rs. 11.40 Lakhs (including IGST). The following table captures the components under Plant & Machinery.
Table 11: Plant and Machinery Plant & Machinery Total Cost (Rs. lakh) Plant & Machinery Roasting Machine 2.60 De-Husking Machine 2.20 Pulveriser 2.80 Sieving Machine 0.80 Packing Machine 3.00 Total Cost 11.40
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4.1.4. Assumptions
Table 12: Assumptions about capacity utilization BARLEY SATTU 75 Kg /hr Capacity Unit Input Capacity per day (Kg) 600 Total days 300 No. of hours machine working every day 8 Raw material require per day (Kg) 600 Handling Loss 3% Year 1 Year 2 Year 3 Year 4 Year 5 Capacity utilization 50% 55% 65.00% 75% 85% No. of operation days 150 165 195 225 255 Total Raw Material 90,000 99,000 117,000 135,000 153,000 Barley for processing 87,300 96,030 113,490 130,950 148,410 Output- BARLEY SATTU 87,300 96,030 113,490 130,950 148,410 Barley Sattu: Grade A (75%) 63,729 70,102 82,848 95,594 108,339 Barley Sattu: Grade B (20%) 17,460 19,206 22,698 26,190 29,682 Barley Sattu: Grade C (5%) 4,365 4,802 5,675 6,548 7,421
Cost Structure Table 13: Cost Structure Assumptions
Number of Unit Cost Annual cost Unit (Rs.) (Rs.) Y1 Y2 Y3 Y4 Y5 A Fixed 100% 105% 110% 115% 120% Telephone 12 1,000 12,000 4,000 12,600 13,200 13,800 14,400 Internet 0 500 ------Office Maintenance 12 1,000 12,000 4,000 12,600 13,200 13,800 14,400 Electricity Charges 12 2,000 24,000 8,000 25,200 26,400 27,600 28,800 Printing & Stationery 12 1,000 12,000 4,000 12,600 13,200 13,800 14,400 Courier, Postage etc 12 500 6,000 2,000 6,300 6,600 6,900 7,200 Misc. Expenses 12 1,000 12,000 4,000 12,600 13,200 13,800 14,400
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Audit Expense 1 30,000 30,000 30,000 31,500 33,000 34,500 36,000 Maintenance Cost 1% 11,400 11,400 11,970 12,540 13,110 13,680 Human resource expense
Marketing Manager 1 30,000 360,000 378,000 378,000 396,000 414,000 432,000 Sales Staff 2 20,000 480,000 480,000 504,000 528,000 552,000 576,000 Supervisor-operations 1 13,500 162,000 162,000 170,100 178,200 186,300 194,400 Sub-Total 1,087,400 1,177,470 1,233,540 1,289,610 1,345,680
B Variable Cost
Raw Material- Barley 16 1,440,000 1,663,200 2,059,200 2,484,000 2,937,600
Skilled Labour 3 500 225,000 259,875 321,750 388,125 459,000
Transportation cost (Inward) 800 72,000 83,160 102,960 124,200 146,880
Transportation cost (Outward) 800 68,443 79,052 97,874 118,065 139,624
Electricity 191 7 200,525 231,606 286,750 345,905 409,071
Packaging 3.00 256,662 296,445 367,027 442,742 523,590
Sub-Total 2,262,630 2,613,338 3,235,561 3,903,037 4,615,765
Total 3,350,030 3,790,808 4,469,101 5,192,647 5,961,445
Revenue Schedule Table 14: Revenue Schedule
REVENUE SUMMARY # Particulars Price/1 kg packet (Rs.) Y1 Y2 Y3 Y4 Y5 1 Barley Sattu: Grade A 60 3,823,740 4,416,420 5,467,948 6,595,952 7,800,430 2 Barley Sattu: Grade B 50 873,000 1,008,315 1,248,390 1,505,925 1,780,920 3 Barley Sattu: Grade C 35 152,775 176,455 218,468 263,537 311,661 Total 4,849,515 5,601,190 6,934,806 8,365,413 9,893,011
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4.1.5. P&L Statement
The below mentioned is the profit & loss statement for barley sattu processing line:
Table 15: P&L Statement
P&L Statement Figures in Rs. Particulars Y1 Y2 Y3 Y4 Y5 Barley Sattu: Grade A 3,823,740 4,416,420 5,467,948 6,595,952 7,800,430 Barley Sattu: Grade B 873,000 1,008,315 1,248,390 1,505,925 1,780,920 Barley Sattu: Grade C 152,775 176,455 218,468 263,537 311,661 Total Revenue 4,849,515 5,601,190 6,934,806 8,365,413 9,893,011 Fixed Cost 1,087,400 1,177,470 1,233,540 1,289,610 1,345,680 Variable Cost 2,262,630 2,613,338 3,235,561 3,903,037 4,615,765 Total Operational Expenses 3,350,030 3,790,808 4,469,101 5,192,647 5,961,445
Earnings Before Interest, Depreciation, Taxes and Amortization (EBITDA) 1,499,485 1,810,382 2,465,706 3,172,767 3,931,565 Depreciation 174,000 174,000 174,000 174,000 174,000 Amortization 5,000 5,000 5,000 5,000 5,000 Earnings Before Interest and Taxes (EBIT) 1,320,485 1,631,382 2,286,706 2,993,767 3,752,565 Interest Expense 201,163 175,606 146,272 114,545 80,026 Earnings Before Taxes (EBT) 1,119,322 1,455,776 2,140,434 2,879,222 3,672,540 Tax 305,083 425,779 649,220 886,750 1,139,474 Earnings After Taxes (EAT) 814,240 1,029,997 1,491,214 1,992,472 2,533,066
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4.1.6. Balance Sheet The below mentioned is the balance sheet statement for Barley Sattu Processing Line: Table 16: Balance Sheet BALANCE SHEET Y1 Y2 Y3 Y4 Y5 ASSETS Current Assets Cash and Bank Balance 851,789 1,753,052 3,086,298 4,888,789 7,196,822 Accounts Receivables 0 0 0 0 0 Other Current Assets Total Current Assets 851,789 1,753,052 3,086,298 4,888,789 7,196,822 Gross Fixed Assets 2,240,000 2,066,000 1,892,000 1,718,000 1,544,000 Less: Depreciation 174,000 174,000 174,000 174,000 174,000 Net Fixed Assets 2,066,000 1,892,000 1,718,000 1,544,000 1,370,000 Preliminary Expenses 20,000 15,000 10,000 5,000 0 TOTAL ASSETS 2,937,789 3,660,052 4,814,298 6,437,789 8,566,822
LIABILITIES & SHAREHOLDERS EQUITY Long Term Debt 1,417,715 1,109,981 773,013 404,033 0 Differed Tax Liabilities TOTAL LIABILITIES 1,417,715 1,109,981 773,013 404,033 0 Share capital 705,835 705,835 705,835 705,835 705,835 Reserves and Surplus Add: Opening Balance (P/L Account) 0 814,240 1,844,236 3,335,450 5,327,922 Profit & Loss) During the Year 814,240 1,029,997 1,491,214 1,992,472 2,533,066 Appropriation - Dividend Total Reserves 814,240 1,844,236 3,335,450 5,327,922 7,860,987 TOTAL EQUITY 1,520,074 2,550,071 4,041,284 6,033,756 8,566,822 TOTAL LIABILITIES & EQUITY 2,937,789 3,660,052 4,814,298 6,437,789 8,566,822
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4.1.7. Key Financial Indicators
Table 17: Key Financial Indicators Financial Indicators IRR 51.7% Project Payback period 2 years 2 months Return on Capital Employed (Average) 65.4% Break Even Point 36.84%
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