A feasibility is prepared to present an in depth techno-commercial analysis carried out on the project idea for consideration of the financial

institutions & others authorities empowered to take the investment decision. Feasibility study should be conducted to determine the viability of an idea before proceeding with the development of the project

Feasibility is nothing but an investigation function that helps to answer :

Is the project Feasible? Can It be Done ? Does It make sense? Should we proceed with proposed idea?

1.

2. 3.

4. 5.

6. 7.

Provides thorough examination of all the issues and assessment of probability of business success. Narrow down the business alternatives. Surface new opportunities through investigation process. Provides financial information. Identify the reasons for the rejection of a project or an idea. Helps in the risk analysis . Provides quality information for decision making.

1.

To ensure that the business or project generates adequate cash flow and profits. The project is able to withstand the risk . Project remains viable in the long run. Project meets the goals of the founders.

2.

3.

4.

1.

Market Analysis
Potential Market Market Share Technical viability Sensible choices Risk Return Potential Market Market Share Environment Damage Restoration Measures

1.

Technical Analysis

1.

Financial Analysis

1.

Economic Analysis

1.

Ecological Analysis

Market Analysis is primarily concerned with two questions: would be the aggregate demand of the

1. What

proposed product/service in future.

2. What

would be the market share of the

project

To answer both the question the analyst has to work on the following points :
1. 2. 3. 4. 5.

6.

Consumption trends Past and present supply position Level of import and export Structure of competition Consumer behavior , intentions, attitudes and preferences. Pricing

1.

Availability of the required quantity and quality of Raw Material :

Available in natural form as deposit, either on the surface or underground, inone or different parts of country. Available as finished product or by-product. Not available in country but to be imported.

1.

Availability of utilities like:

Power. Water. Manpower.

1.

Appropriateness of the plant design and layout.

3. Choice of Technology:
Plant Capacity Principal Inputs Product Mix Latest Developments Ease of absorption. Process Selection. Access to Raw Material &markets Labor Situation Availability of power, water , skilled and unskilled labor Availability of tax incentives if any Approach to the site. Facilities for drainage and effluent disposal. Transportation and marketing of the finished goods. Communication.

4. Location and Site Decisions:

Raw material survey Demand study Technical study Location study Financial Estimates Profitability & cash flow analysis Cost benefit analysis

Product pattern Process selection Plant size Raw material requirements Some of the factors which may weigh heavily are: Size of investment Limitation of foreign exchange Limitation of power Disposal of by-products & effluents

1.

Cost of the project

Land & site development Building & civil works Plant & machinery Technical know how expenses Raw material expenses Human Resource expenses

1. 2. 3.

Means/ Sources of Finance Projected profitability. Rate of return, .

Short term financing

Intermediateterm financing Long term financing

Trade credit Loan from commercial bank Commercial paper Accounts receivable financing Term loans Hire purchase Lease financing Fixed deposit from public Central Govt. subsidy Common stock Debt Preferred stock

1.

2.

3.

The impact of the project on the distribution of income in the society. Impact of the project on the level of savings and investment in the society. Contribution of the project towards the fulfillment of certain wants like self sufficiency , employment etc.

What are the likely damage to be caused by the project to the environment? What is the method/ cost of restoration measures required to ensure that the damage to the environment is contained within acceptable limits? .

A project may cause environmental pollution in various ways : it may throw gaseous emissions , it may produce liquid and solid discharges, it may cause noise, heat etc. Hence the environmental aspects of these projects have to properly examined.

What are the types of effluents and emissions generated? What need to be done for the proper disposal of effluents and treatment of emissions? Will the project be able to secure all environmental clearances and comply with the statutory requirements?

Environmentalists have identified 4 types of different stresses or pressures that have been continuously inflicted on environment :

1.Eutrophic

Stress: Refers to the release of various kinds of wastes into the river and other water bodies . Stress: refers to the exploitation of natural resources for the production and consumption purposes through agriculture , industry, extraction, fishing etc.

2.Exploitative

3.

Disruptive Stress: Refers to the physical alterations in nature resulting from the such activities like forest clearance, highways, railways, factory buildings etc. Chemical and Industrial Stress: this results mainly from the developments in science and technology and their applied fields like industry , warfare and agriculture.

4.

Environmentalists have identified and classified various components of environment into 4 levels :

Level1: physical resources covering land , water, air . Level2: Ecological Resources: consisting of aquatic ,terrestrial , and rare species. Level 3: Human Use Values covering transport , agriculture, water supply, mining industry , etc. Level 4: Quality of Life Values, covering socio economic , cultural .

The nature and the extent of environment impact mainly depends upon:

1. Nature,

size and type of the project 2. Technology 3. Location

EIA and EIS is said to be the instruments through which the environmental management tries to accomplish its objectives. The objective is to seek ways by which the project can proceed without any irreparable losses to environment and minimum losses if any .

EIA: is defined as the activity designed to identify , predict, interpret and communicate the information about the impact of an action on mans health and well being. EIS : is a document prepared by the expert based on studies disclosing the likely or certain environmental impacts if a proposed action/project, thus alerting the decision maker about the environmental risks involvedthus reject the proposed project or permit it subject to compliance with specific conditions.