PROJECT FEASIBILITY ANALYSIS OF

SILOAM HOSPTAL DEVELOPMENT

Lecturer
Ketut Wiwin Andayani, S.T., M.T.

Created by
I Komang Mahardika (2015113044/09)

D3 CIVIL ENGENEERING STUDY PROGRAM

CIVIL ENGINEERING DEPARTEMENT
BALI STATE POLYTECHNIC
2022
1. Project Information
PT Siloam International Hospital Tbk as a part of Lippo Group is one of a health service
provider company in Indonesia. In 2023 PT Siloam International Tbk plans to developing a new
hospital in Surabaya. The initial capital of the project is Rp120,000,000,000 and the annual
benefit plan of the company is Rp17,000,000,000. The payback period of the project is 50 years.
The interest rate follows the data from Bank Indonesia, which is 10% and the operational and
maintenance cost is 1% from capital cost.

2. Project Feasibility Analysis

To analyze the feasibility of the project from economic aspect, parameters that used includes
the Benefit Cost Ratio (BCR), Net Present Value (NPV), and Internal Rate of Return (IRR).

2.1. Benefit Cost Ratio (BCR)

After calculating, obtained the following results:

BCR = B/C
BCR = Rp17 B / Rp13.303 B
BCR = 1.28
 2.2. Net Present Value (NPV)
After calculating, obtained the following results:

NPV = B-C
NPV = Rp17 B - Rp13.303 B
NPV = 3.70

2.3.Internal Rate of Return (IRR)

After calculating, obtained the following results:
Capital Cost = Rp120,000,000,000
Annual Benefit = Rp17,000,000,000
Payback Period = 50 years
Interest Rate = 10 %
O & M Cost = 1 % from capital cost
(A/F, 10, 50) = 0.00086

Calculation of Annual Cost:

Cost Type Calculation Total Cost
(Rp)
Depreciation (A/F, 10, 50) x Rp120,000,000,000 103,200,000
Interest 10% x Rp120,000,000,000 12,000,000,000
O & M Cost 1% x Rp120,000,000,000 1,200,000,000
Annual Cost 13,303,200,000
Capital Cost = Rp120,000,000,000
Annual Benefit = Rp17,000,000,000
Payback Period = 50 tahun
Interest Rate = 15 %
O & M Cost = 1 % from capital cost
(A/F, 15, 50) = 0.00014

Calculation of Annual Cost:

Cost Type Calculation Total Cost
(Rp)
Depreciation (A/F, 15, 50) x Rp120,000,000,000 16,800,000
Interest 15% x Rp120,000,000,000 18,000,000,000
O & M Cost 1% x Rp120,000,000,000 1,200,000,000
Annual Cost 19,216,800,000

IRR = 22.49%

3. Conclusion
Based on calculation and analysis of the Benefit Cost Ratio (BCR), Net Present Value
(NPV), and Internal Rate of Return (IRR), obtained the following results:
Annual Benefit = Rp17,000,000,000
Annual Cost = Rp13,303,200,000
BCR = 1.28 ≥ 1 → (eligible)
NPV = 3.70 > 0 → (eligible)
IRR = 22.49% > 10% (interest rate applies) → (eligible)
Because the results of the analysis meet all the parameters used, it can be concluded that the
development of the Siloam Hospital is economically feasible.