DETAILED PROJECT REPORT

Submittd by:
Mr. Jatin K. Pael
Mr. Vivek R. Patel
DETAILED PROJECT REPORT
Detailed project report is a complete
document for investment , decision-
making, approval, planning.
Detailed project report is base
document for planning the project and
implementing the project.
OBJECTIVES
 To understand the importance of developing a
detailed project report that assure performance
for reliable quality with in optimum cost
 To appreciate that projects are site specific
 To understand importance of optimization of the
schemes , detailed cost estimate , payback period
and return on investment.
 To describe how bankable projects can help to
achieve required performance
 To understand methodology of project appraisal
Brief Description of Project Area
 Name of utility
 District / town (s) village covered
 Location : latitude and longitude
 Area , population , boundaries
 Climatic conditions
 Status of development. Access to electricity
 Economic structure – socio – economic features
 urban / rural
Data Collection of Existing Project
PROJECT COST DETAILS
Basic Equipment Cost
Consultant charges
Duties , Taxes & Freight
a) Excise duty / customs duty/ sales tax
Freight and Transit Insurance
Raw materials
Man Power cost
Engineering Project Management.
Supervision
Interest During Construction
Major Benefits from the Project
Project Investment Criteria
Basically Cost – Benefits analysis
Investment criteria can be
 payback period
 Discounted cash flow (DCF) Technique
a) Net Present Worth (NPW)
b) Benefit Cost Ratio ( B C Ratio)
c) Internal rate of return ( IRR )
Project Investment Criteria
Payback Period
 length of the time required by the
cumulative net cash inflows to cover up
the fixed capital Investment .

PBP = Total Capital Investment / Total

cash inflow or Net benefits per year
Project Investment Criteria
Payback Period
Easy to understand
Other methods are complicated in nature
and difficult to comprehend for technical
people
Investment should include fixed capital
&working capital
Net benefits to be adjusted for interest and
tax liabilities
Project Investment Criteria
Discounted Cash Flow ( DCF) Technique
A technique which brings past & future
cost benefits to their Present Worth ( PW)

Take into account “ Time Value of Money

’’
Project Investment Criteria
Discounted Cash Flow ( DCF)
Past Benefits Cost – Compounding
Future Benefits Cost – Discounting

Past Present Future

 DPR Structure
 Title Page , Name,affliation,date etc
 Acknowledgement
 Content list
 Abbreviation
 Executive Summary
 Introduction Background
 Main technical & financial analysis
chapters
 Recommended action plan
 Appendices
What DPR Should ideally
provide ?
 Final cost details and benefits expected
 Detailed specification of equipment &
materials.
 All information to prepare tender
documents.
 Probable list of equipment & material
manufacturers
 Project management process
PARAMETERS OF PROJECT
APPRAISAL AND APPRAISAL
PROCEDURE
PROJECT ELIGILITY
 Technically feasible and provide optimal cost
solution for the selected alternative
 Techno – economically sound with IRR not
less than 12% (Internal Rate of Return )
 Compatible with expansion plan of the utility
& region
 Complies with all environmental standards
guideline.
 All clearances have been obtained
PARAMETERS OF PROJECT
APPRAISAL AND APPRAISAL
PROCEDURE
ASCERTAIN PROJECT PROFILE
 Type , Purpose , Scope
 Location , Access to site
 Environmental Management
 Technology
REVIEW PROJECT
Need & Justification :
 Existing and proposed system
 Demand supply scenario
 Alternative considered
 Study if any carried out by State Govt /
utility
 Status & Preparedness
 Procurement procedures &
competitiveness
REVIEW PROJECT

 status& Preparedness
 Procurement procedures &
competitiveness
 O & M arrangements
 Market & selling arrangements
a) PPA with purchaser if applicable
(Power purchasing agreement)
REVIEW PROJECT
 Financing plan
a) Debt Equity
b) Phasing of expenditure
CHECK AVAILABILITY OF
APPROVALS & CLEARANCES
Statutory Clearances such as
 Land Availability & Acquisition
 Forest Clearance
 Highway Clearance
 Electricity clearance
 Fund related clearance
 Pollution control board clearance etc
CHECK AVAILABILITY OF
APPROVALS & CLEARANCES
APPROVALS
 Board approval
 Approval of PPA
 CERS / SERC
 State government
ASSESS REASONABLENESS
OF COST
Price level
Basis and reasonableness of cost
estimate
a) Information available for similar
projects appraised in the past
b) Budgetary offers received from
suppliers
c) Similar job done by same / other
borrowers in the past
ASSESS REASONABLENESS
OF COST

IDC - Price variation

Contingency – Other costs
PERFOM FINANCIAL & RISK
ANALYSIS
Evaluate Costs & Benefits
a) Benefits
b) Reduction in losses
c) Additional Generation in MU
PERFOM FINANCIAL & RISK
ANALYSIS
 Specify Assumptions of base case .
Calculate FIRR, EIRR
 Financial Internal Rate of Return
 Economic Internal Rate of Return
Assess Risks :
a) Pre implementation
b) Implementation
c) Post implementation
 Perform Sensitivity & Scenario Building
CASY STUDY
THANK YOU