Sriphala Carbons

Financial calculation basics:

Financial Calculation is done with the following basics. This document can be changed as per investor requirements.
1) All funding for the project is through FDI.
2) A 5% interest is provided on all funds.
3) All returns are taken out on a yearly basis.
4) Variation Analysis includes a 5% reduction on sale price.
5) Another variation includes a 5% increase in production cost.
6) Income Tax calculated at the rate of 45.32% ( This includes all surcharges)
note: One way to reduce tax liabilities is to reinvest the returns back into the project.
7) Breakeven achieved in the second year.
8) Year 1 and Year 2 are the gestation periods ( Plant is producing but kilns are still being installed). From the 3rd Year the plant will be fully
operational.
9) First year there will be a depreciation loss. This is because the plant is operational only 120 days during the first year.
10) Financial calculations can be changed based on feedback from investors.
 Sriphala Carbons

COST OF THE PROJECT

1 Land $ 284090.00

2 Building $ 1220631.00

3 Plant & Machinery $ 2454856.00

4 Electrical Services, equipments & wiring $ 239090.00

5 Insurance, Transportation & contingencies $ 182954.00

6 Licence Fee, Registration and other Statutory Charges $ 50000.00

7 Consultancy (Estimated at 10% of Project cost) $ 443162.10

8 Margin for working capital $ 2601654.69

$ 7476437.79

MEANS OF FINANCE

Foreign Direct Investment (Including Working

1 Capital) 100.00% $ 7476437.79

2 Loan from Investors 0.00

Term Loan - Machinery 30.00

$ 7476437.79
 Sriphala Carbons

INVESTMENT BY PHASES Year 1 2

1 Land 284090.00 0.00

2 Building 880764.75 339866.25

3 Plant & Machinery 1588714.00 866142.00

4 Electrical Services, equipments & wiring 129545.25 109544.75

5 Insurance, Transportation & contingencies 121469.53 61484.47

6 Licence Fee, Registration and other Statutory Charges 50000.00 0.00

7 Consultancy (Estimated at 10% of Project cost) 305458.35 137703.75

3360041.89 1514741.21

MEANS OF FINANCE

1 Foreign Direct Investment (Including Working Capital) 100.00% 3360041.89 1514741.21

2 Loan from Investors 0.00 0.00

Term Loan - Machinery

3360041.89 1514741.21
 Sriphala Carbons

PROJECTIONS OF PERFORMANCE, PROFITABILITY AND REPAYMENT

S.No YEAR 1 2 3 4 5 6 7
PRODUCTION - ACTIVATED CARBON in MT 674.647 5022.059 9416.950 9416.950 9416.950 9416.950 9416.950
Utilisation of Raw Material in MT 1894.560 14103.065 26444.900 26444.900 26444.900 26444.900 26444.900

A SALES
1 Activated Carbon 890844.55 6631428.29 12434705.21 12434705.21 12434705.21 12434705.21 12434705.21

NET SALES 890844.55 6631428.29 12434705.21 12434705.21 12434705.21 12434705.21 12434705.21

B COST OF PRODUCTION
2 Coconut Shell Charcoal 430576.65 3205203.62 6010132.42 6010132.42 6010132.42 6010132.42 6010132.42

3 Power & Fuel 12206.40 90864.19 170381.00 170381.00 170381.00 170381.00 170381.00

4 Direct Labour & Wages 142772.73 252818.18 252818.18 252818.18 252818.18 252818.18 252818.18

5 Pre-activation under job work 6460.45 48091.45 90177.11 90177.11 90177.11 90177.11 90177.11

6 Consumables - Steam Pipe 735.36 5474.00 10264.40 10264.40 10264.40 10264.40 10264.40

7 Depreciation 417354.55 569373.06 489629.87 421281.89 362676.45 312403.14 269258.02

C TOTAL EXPENSES 1010106.13 4171824.50 7023402.98 6955055.00 6896449.56 6846176.26 6803031.13

D GROSS PROFIT [ A - C ] (119261.58) 2459603.78 5411302.22 5479650.21 5538255.65 5588528.95 5631674.08

E INTEREST

1. Interest on Investment 168002.09 243739.16 243739.16 243739.16 243739.16 243739.16 243739.16

2. Interest on Working Capital Investment 10356.69 69563.98 130082.73 130052.13 130025.89 130003.38 129984.06

Total Financial Expenses 178358.79 313303.13 373821.89 373791.29 373765.04 373742.53 373723.22

F Admn & Selling expenses 46724.05 347812.82 652189.81 652189.81 652189.81 652189.81 652189.81

G PROFIT BEFORE TAX [ D - (E+F) ] (344344.41) 1798487.83 4385290.53 4453669.12 4512300.80 4562596.61 4605761.06

H PROVISION FOR TAXES 0.00 659017.80 2646431.46 2018402.84 2044974.72 2067768.79 2087330.91
 Sriphala Carbons

I PROFIT AFTER TAX (344344.41) 1139470.03 1738859.07 2435266.27 2467326.08 2494827.83 2518430.15

CASH FLOW STATEMENT

YEAR 1 2 3 4 5 6 7
A SOURCES OF FUNDS

1 Share Capital 3360041.89 1514741.21 0.00 0.00 0.00 0.00 0.00

2 Profit Before Interest and Tax (165985.63) 2111790.96 4759112.42 4827460.40 4886065.84 4936339.15 4979484.27

3 Depreciation 417354.55 569373.06 489629.87 421281.89 362676.45 312403.14 269258.02

4 Increase in Working Capital Loan 207133.86 1184145.69 1210375.13 (612.07) (524.82) (450.21) (386.37)

TOTAL (A) 3818544.67 5380050.92 6459117.42 5248130.22 5248217.47 5248292.08 5248355.92

B DISPOSITION OF FUNDS
1 Capital expenditure 3360041.89 1514741.21 0.00 0.00 0.00 0.00 0.00

2 Increase in Current Assets 207133.86 1184145.69 1210375.13 (612.07) (524.82) (450.21) (386.37)

3 Interest on Term Loan 168002.09 243739.16 243739.16 243739.16 243739.16 243739.16 243739.16

4 Interest on Working Capital Loan 10356.69 69563.98 130082.73 130052.13 130025.89 130003.38 129984.06

5 Taxation 0.00 659017.80 2646431.46 2018402.84 2044974.72 2067768.79 2087330.91

6 Dividend/Distribution of profits 0.00 795125.62 1738859.07 2435266.27 2467326.08 2494827.83 2518430.15

TOTAL (B) 3745534.53 4466333.45 5969487.55 4826848.33 4885541.02 4935888.94 4979097.90

CASH IN HAND AND AT BANK

Opening Balance 0.00 73010.13 986727.60 1476357.47 1897639.36 2260315.81 2572718.95

Net surplus ( A - B ) 73010.13 913717.47 489629.87 421281.89 362676.45 312403.14 269258.02

Closing Balance 73010.13 986727.60 1476357.47 1897639.36 2260315.81 2572718.95 2841976.97

 Sriphala Carbons

PROJECTED BALANCE SHEET

YEAR 1 2 3 4 5 6 7

LIABILITIES

1 Capital 3360041.89 4874783.10 4874783.10 4874783.10 4874783.10 4874783.10 4874783.10

2 Reserves & Surplus (344344.41) 0.00 0.00 0.00 0.00 0.00 0.00

3 Working Capital Loan - CC 207133.86 1391279.55 2601654.69 2601042.61 2600517.79 2600067.58 2599681.21

4 Current Liabilities 0.00 0.00 0.00 0.00 0.00 0.00 0.00

TOTAL 3222831.33 6266062.65 7476437.79 7475825.71 7475300.89 7474850.68 7474464.31

ASSETS

1 Fixed Assets 2942687.34 3888055.50 3398425.63 2977143.74 2614467.29 2302064.15 2032806.13

2 Current Assets
Inventories 132896.82 838660.53 1565429.25 1564817.18 1564292.36 1563842.15 1563455.77
Receivables 74237.05 552619.02 1036225.43 1036225.43 1036225.43 1036225.43 1036225.43

3 Cash & Bank Balances 73010.13 986727.60 1476357.47 1897639.36 2260315.81 2572718.95 2841976.97

TOTAL 3222831.33 6266062.65 7476437.79 7475825.71 7475300.89 7474850.68 7474464.31

 Sriphala Carbons

WORKING CAPITAL ASSESSMENT

YEAR - > 1 2 3 4 5 6 7
Norms
1 Raw Material 3 mths 107644.16 801300.91 1502533.11 1502533.11 1502533.11 1502533.11 1502533.11

2 Work in Process - 0.00 0.00 0.00 0.00 0.00 0.00 0.00

3 Finished Goods 3 days 25252.65 37359.62 62896.15 62284.07 61759.25 61309.04 60922.67

4 Debtors 30 days 74237.05 552619.02 1036225.43 1036225.43 1036225.43 1036225.43 1036225.43

207133.86 1391279.55 2601654.69 2601042.61 2600517.79 2600067.58 2599681.21

5 Less: Creditors - 0.00 0.00 0.00 0.00 0.00 0.00 0.00

WORKING CAPITAL 207133.86 1391279.55 2601654.69 2601042.61 2600517.79 2600067.58 2599681.21

GAP

MARGIN 0.00 0.00 0.00 0.00 0.00 0.00 0.00

PERMISSIBLE BANK FINANCE 207133.86 1391279.55 2601654.69 2601042.61 2600517.79 2600067.58 2599681.21

INVESTMENT BY
FDI 207133.86 1391279.55 2601654.69 2601042.61 2600517.79 2600067.58 2599681.21

Total 207133.86 1391279.55 2601654.69 2601042.61 2600517.79 2600067.58 2599681.21

Interest on Working capital @ 5% 10356.69 69563.98 130082.73 130052.13 130025.89 130003.38 129984.06
 Sriphala Carbons

VIABILITY ANALYSIS

1 BREAK EVEN POINT

YEAR -
> 1 2 3 4 5 6 7
A. Net Sales 890844.55 6631428.29 12434705.21 12434705.21 12434705.21 12434705.21 12434705.21

B. Variable Costs
Raw Material 430576.65 3205203.62 6010132.42 6010132.42 6010132.42 6010132.42 6010132.42
Power & Fuel 12206.40 90864.19 170381.00 170381.00 170381.00 170381.00 170381.00
Pre-activation under job work 6460.45 48091.45 90177.11 90177.11 90177.11 90177.11 90177.11
Consumables - Steam Pipe 735.36 5474.00 10264.40 10264.40 10264.40 10264.40 10264.40

449978.86 3349633.27 6280954.93 6280954.93 6280954.93 6280954.93 6280954.93

C. Fixed Costs
Labour & Plant Overheads 142772.73 252818.18 252818.18 252818.18 252818.18 252818.18 252818.18
Administrative Expenses 46724.05 347812.82 652189.81 652189.81 652189.81 652189.81 652189.81
Financial Expenses 178358.79 313303.13 373821.89 373791.29 373765.04 373742.53 373723.22
Depreciation 417354.55 569373.06 489629.87 421281.89 362676.45 312403.14 269258.02

785210.11 1483307.19 1768459.75 1700081.16 1641449.48 1591153.66 1547989.22

D. Contribution [ A - B ] 440865.69 3281795.02 6153750.28 6153750.28 6153750.28 6153750.28 6153750.28

E. Break Even Point [ (C / D) x100 ] 178.11% 45.20% 28.74% 27.63% 26.67% 25.86% 25.16%

F. Cash Break Even Point [ ( C - Depreciation) / D x100 ] 83.44% 27.85% 20.78% 20.78% 20.78% 20.78% 20.78%

G. BEP in terms of Volume of Production (MT) 1201.590 2269.873 2706.235 2601.597 2511.874 2434.908 2368.854
[ BEP x Production ]

H. BEP in terms of Sales Value ( Rs. In Thousands) - 2997275.95 3573475.47 3435304.83 3316829.49 3215198.19 3127977.05
[ BEP x A ]
 Sriphala Carbons

VIABILITY ANALYSIS

YEAR -
Sl. > 1 2 3 4 5 6 7
No.

1 Profit After Tax - 1139470.03 1738859.07 2435266.27 2467326.08 2494827.83 2518430.15

2 Cash Profit 73010.13 1708843.09 2228488.94 2856548.16 2830002.52 2807230.97 2787688.16

3 Gross Profit to Sales - 37.09% 43.52% 44.07% 44.54% 44.94% 45.29%

4 Operating Profit to Sales - 31.85% 38.27% 38.82% 39.29% 39.70% 40.05%

5 Profit after Tax to Sales - 17.18% 13.98% 19.58% 19.84% 20.06% 20.25%

6 Cash Profit to Sales - 25.77% 17.92% 22.97% 22.76% 22.58% 22.42%

7 Total Outside Liabilities to Tangible Net Worth - 0.00 0.00 0.00 0.00 0.00 0.00

8 Current Ratio 1.00 1.00 1.00 1.00 1.00 1.00 1.00

9 Return on Investment 2.42% 35.05% 45.71% 58.60% 58.05% 57.59% 57.19%

[ Cash Profit / Term Liabilities + Net Worth ]
 Sriphala Carbons

SENSITIVITY & VIABILITY ANALYSIS

YEAR -
> 1 2 3 4 5 6 7

1 Profit After Tax (344344.41) 1139470.03 1738859.07 2435266.27 2467326.08 2494827.83 2518430.15

2 Cash Profit 73010.13 1708843.09 2228488.94 2856548.16 2830002.52 2807230.97 2787688.16

3 Cost of Production 1010106.13 3602451.45 6533773.11 6533773.11 6533773.11 6533773.11 6533773.11

4 5 % of Cost of Production 50505.31 180122.57 326688.66 326688.66 326688.66 326688.66 326688.66

5 Sales Value 890844.55 6631428.29 12434705.21 12434705.21 12434705.21 12434705.21 12434705.21

6 5 % of Sales Value 44542.23 331571.41 621735.26 621735.26 621735.26 621735.26 621735.26

7 Cash Profit when Cost of Production goes up by 5%(2- 4) 22504.82 1528720.52 1901800.28 2529859.50 2503313.87 2480542.32 2460999.51

8 Cash Profit when selling price comes down by 5% ( 2 -6 ) 28467.90 1377271.68 1606753.68 2234812.90 2208267.26 2185495.71 2165952.90
 Sriphala Carbons

PRODUCTION PLAN AND SALES VALUE

Year 1 2 3 4 5 6 7

Product Activated Carbon

Raw Material (RM) Coconut Shell Charcoal
No. of days Working 120 335 335 335 335 335 335
Capacity Utilisation 20.00% 53.33% 100.00% 100.00% 100.00% 100.00% 100.00%
Raw Material requirement @100%
Utilisation (in Tonnes/day) 78.940 78.940 78.940 78.940 78.940 78.940 78.940
RM requirement at
working capacity 1894.56 14103.06517 26444.9 26444.9 26444.9 26444.9 26444.9
Cost of Raw Material per tonne $227.27 $227.27 $227.27 $227.27 $227.27 $227.27 $227.27

Total Cost of Raw Material $430,576.65 $3,205,203.62 $6,010,132.42 $6,010,132.42 $6,010,132.42 $6,010,132.42 $6,010,132.42

SALES 37118.52301
28.11029718
Input of Raw Material 1894.560 14103.065 26444.900 26444.900 26444.900 26444.900 26444.900
Crushing Loss @ 7.00% 132.619 987.215 1851.143 1851.143 1851.143 1851.143 1851.143
1761.941 13115.851 24593.757 24593.757 24593.757 24593.757 24593.757
Activation Loss @ 61.71% 1087.294 8093.791 15176.807 15176.807 15176.807 15176.807 15176.807
Output of Carbon in Tonnes 674.647 5022.059 9416.950 9416.950 9416.950 9416.950 9416.950
Selling Price per
Tonne $ 1320.46 1320.46 1320.46 1320.46 1320.46 1320.46 1320.46
Total Sales $ 890844.55 6631428.29 12434705.21 12434705.21 12434705.21 12434705.21 12434705.21

Total Sales Revenue 890844.55 6631428.29 12434705.21 12434705.21 12434705.21 12434705.21 12434705.21
 Sriphala Carbons

POWER & FUEL

Year 1 2 3 4 5 6 7

Power consumption as per

production plan per day in units 5086 5086 5086 5086 5086 5086 5086

Per annum units 122064 908642 1703810 1703810 1703810 1703810 1703810

Rate per unit $ 0.10 0.10 0.10 0.10 0.10 0.10 0.10

Total cost of power $ 12206.40 90864.19 170381.00 170381.00 170381.00 170381.00 170381.00
 Sriphala Carbons

LABOUR COST
Labour Requirements & Wages Workings
For the year
1 Year 2 and thereafter
Sl. Class Per day Salary per Salary per Per day Salary per Salary per
No. requirement month annum requirement month annum

1 Directors 3 1704.55 30681.82 3 1704.55 61363.64

2 Managers 3 681.82 12272.73 3 681.82 24545.45

3 Factory Manager 1 568.18 3409.09 1 568.18 6818.18

4 Supervisors 1 227.27 1363.64 1 227.27 2727.27

5 Chemists 2 227.27 2727.27 7 227.27 19090.91

6 Operators 3 170.45 3068.18 15 170.45 30681.82

7 Unskilled Labourers 40 136.36 65454.55 40 136.36 65454.55

118977.27 210681.82
Perks @ 20 % 23795.45 42136.36

Total 142772.73 252818.18

Year 1 2 3 4 5 6 7

Total Direct Labour $ 142772.73 252818.18 252818.18 252818.18 252818.18 252818.18 252818.18
 Sriphala Carbons

OTHER EXPENSES

Year 1 2 3 4 5 6 7

Pre-activation under job work 6460.45 48091.45 90177.11 90177.11 90177.11 90177.11 90177.11
per tonne of RM $3.41 3.41 3.41 3.41 3.41 3.41 3.41 3.41

Consumables - Steam Pipe 735.36 5474.00 10264.40 10264.40 10264.40 10264.40 10264.40
Estimated for one day
at $30.64 30.64 30.64 30.64 30.64 30.64 30.64 30.64

Administration
Expenses 2181.82 16241.41 30454.55 30454.55 30454.55 30454.55 30454.55
Estimated for one day
at $90.91 90.91 90.91 90.91 90.91 90.91 90.91 90.91

Selling Expenses 44542.23 331571.41 621735.26 621735.26 621735.26 621735.26 621735.26

Packing , Shippping etc
Estimated on sales at 5%
 Sriphala Carbons

DEPRECIATION
(Calculated under WDV for Income Tax purpose)

Year 1 2 3 4 5 6 7
Opening Balance
Building $ 880764.75 1132554.53 1019299.07 917369.17 825632.25 743069.02 668762.12
Plant & Machinery $ 1588714.00 2216548.90 1884066.57 1601456.58 1361238.09 1157052.38 983494.52
Electrical services etc $ 129545.25 219658.21 186709.48 158703.06 134897.60 114662.96 97463.52
Insurance, Licence fee
& $ 476927.89 604576.92 513890.38 436806.82 371285.80 315592.93 268253.99
Consultancy
Total $ 3075951.89 4173338.55 3603965.50 3114335.63 2693053.74 2330377.29 2017974.15

Depreciation
Building 10% 88076.48 113255.45 101929.91 91736.92 82563.22 74306.90 66876.21
Plant & Machinery 15% 238307.10 332482.34 282609.98 240218.49 204185.71 173557.86 147524.18
Electrical services etc 15% 19431.79 32948.73 28006.42 23805.46 20234.64 17199.44 14619.53
Insurance, Licence fee
& 15% 71539.18 90686.54 77083.56 65521.02 55692.87 47338.94 40238.10
Consultancy
Total 417354.55 569373.06 489629.87 421281.89 362676.45 312403.14 269258.02

Closing Balance
Building $ 792688.28 1019299.07 917369.17 825632.25 743069.02 668762.12 601885.91
Plant & Machinery $ 1350406.90 1884066.57 1601456.58 1361238.09 1157052.38 983494.52 835970.34
Electrical services etc $ 110113.46 186709.48 158703.06 134897.60 114662.96 97463.52 82843.99
Insurance, Licence fee
& $ 405388.70 513890.38 436806.82 371285.80 315592.93 268253.99 228015.89
Consultancy
Total $ 2658597.34 3603965.50 3114335.63 2693053.74 2330377.29 2017974.15 1748716.13
 Sriphala Carbons

INCOME TAX

Year 1 2 3 4 5 6 7

Profit before Tax $ (344344.41) 1798487.83 4385290.53 4453669.12 4512300.80 4562596.61 4605761.06

Adjustments for previous year 0.00 (344344.41) 1454143.41 0.00 0.00 0.00 0.00
losses
Taxable Profit $ (344344.41) 1454143.41 5839433.94 4453669.12 4512300.80 4562596.61 4605761.06

Income Tax @ 45.32% $ 0.00 659017.80 2646431.46 2018402.84 2044974.72 2067768.79 2087330.91