PROJECT REPORT

CA SHREYANS TEJPAL SHAH

 HIGHLIGHTS OF THE PROJECT

1. Name of the Project : M/S.

2. Address of unit : Proposed in

3. Constitution : Proprietorship of

4. Nature of Activity : Food Processing

5. Status :

6. Cost of Project : ₹ 90.00 Lakhs

7. Means of Finance : Capital ₹ 25.00 Lacs

Bank Loan ₹ 65.00 Lacs

Total ₹ 90.00 Lacs

8. Contact :

9. Experience :

10. Working Capital Funding : ₹ 55.00 Lakhs

Project Report of Soya Processing, prepared by CA Shreyans Tejpal Shah

 PROJECT REPORT
OF
SOYA PROCESSING

INTRODUCTION

Soybean meal is used in food and animal feeds, principally as a protein supplement,
but also as a source of metabolizable energy. Typically 1 bushel (i.e. 60 lbs. or 27.2 kg) of
soybeans yields 48 lbs. (21.8 kg) of soybean meal. Some, but not all, soybean meal is produced
from the residue left after oil extraction. (Removal of the oil, which is used mostly in food, but
also for industrial oils, soaps and biodiesel, involves crushing and either pressing or solvent
extraction.) Some, but not all, soybean meal contains ground soybean hulls. Soybean meal is
heat-treated during production, to denature the trypsin inhibitors of soybeans, which would
otherwise interfere with protein digestion.

Full Fat Soya is product derived from processing of Soya at high speed and
temperature. This results into keeping intact the nutritional value while reducing the Urease
activity and Trypsin so that making it completely digestible. Thus, FFS (Full Fat Soya) produced
by this mechanical process, becomes easily suitable for human consumption as well as cattle
feed additive.

So by following the HTST (High Temperature Short Time) process, we convert soya
meal accommodating more than 75% of By-Pass protein, urease activity de-activated, Very
low Trypsin inhibitors, so that it becomes the best available feed for the ruminants in the
market.

Soya Beans: -

Project Report of Soya Processing, prepared by CA Shreyans Tejpal Shah

Full Fat Soya: -

Soya Oil: - Defatted Soya Meal: -

LOCATION

The project is proposed in , which is nearby to State highway and gives

us access to distant locations easily. The construction of the building is being done adhering
to the guidelines and specifications required for the project.

Project Report of Soya Processing, prepared by CA Shreyans Tejpal Shah

LAND & BUILDING

The proprietor has proposed this project for which already holds the required land.
Furthermore, he has already constructed the building required for the project and it’s ready
for use. The proprietor has invested ₹ 25.00 Lacs so far, which includes land and factory
building. The area of the building is 3000 Sq. Ft. which is sufficient for the project including
storage space and production floor.

MARKET POTENTIAL

Full Fat Soya is a prime raw material for various soya based products such as Soya
chunks, Soya meat, Soya Chips and snacks, etc. Soya oil, produced in this process, is non
chemical process oil, which is being exported. Further, Defatted soya Meal it is used in poultry
feed. Thus, the products will see local and export demand.

The proprietor, being in this business for more than 15 years, have a very good study
of demand, supply and the market.

MANUFACTURING PROCESS

Manufacturing process is a multiple steps process, which can be depicted as follows:

Soya Beans Cleaning

De-husking

Feeding into Extruder

Extrusion Process

Oil Expeller (in case of Soya Oil & Defatted Soya Meal)

Cooling & Inspection

Project Report of Soya Processing, prepared by CA Shreyans Tejpal Shah

 Packing & Dispatch

The actual manufacturing process is a single step process where the crushing and
cooking is done in the machine at approx. 1450 C in the duration of 8-10 seconds, which results
into Full Fat Soya. The oil and moisture content in the soya bean cooks itself and reduces the
Trypsin and Urease Activity. Further, to produce soya oil, the resultant output i.e. Full Fat Soya
is processed through oil expellers. This will produce soya oil and the remains is Defatted Soya
Meal. The input output ratio is 97 % in case of Full Fat Soya. If we process further, the output
will be 12 % Oil and 85 % Defatted Soya Meal of the original input.

The process loss is 3 % of the input as the moisture content is reduced in the process
due to the moisture. The oil produced in this process is produced without any chemical
process unlike the Solvant extraction. Thus, this oil is acceptable for exports and has a good
demand.

RAW MATERIAL AVAILIBILITY

The main raw material required for the project is Soyabeans. Sangli is a big soyabeans
trading center. Furthermore, Palus, Bhilwadi, Takari area has a large farming base for Soya
beans, thus the soya bean produce will be available locally from the direct farmers.

PROJECT COST DETAILS

₹ In Lacs
A. Land and development Own
B. Building 30.00
C. Extruder 21.00
D. Oil press & Other Machinery 30.00
E. Electric Installation & erection 07.00
F. Misc. Assets 02.00
Total 90.00
Misc. Assets shall include computers, handling equipments, etc., which are required
for day to day operating and activities.

Project Report of Soya Processing, prepared by CA Shreyans Tejpal Shah

REQUIREMENT OF WORKING CAPITAL

Raw Materials Stock : 7 Days 58.97

Finished Goods Stock : 2 Days 17.89

Stock in Process : 2 Days 17.62

Debtors : 15 Days 96.12

Creditors : 7 Days -40.50

150.00

Margin 40.00

Bank Finance
110.00
(Cash Credit)
Note: -
Stock Levels for working capital are calculated assuming 250 days of working due to
seasonal nature of goods.

MEANS OF FINANCE

This project shall be financed in following manner:

₹ In Lacs
A. Capital Contribution 25.00
B. Bank Term Loan 65.00
Total 90.00

IMPLEMENTATION SCHEDULE

This project will be implemented in following schedule:

Sr. No. Activity Period
1. Acquisition and Development of Land. -
2. Civil Work and building construction Ready
3. Procurement of machinery and Licenses 2-3 months
4. Arrangement for Power supply 1 month
5. Water Supply arrangement 2 weeks

Project Report of Soya Processing, prepared by CA Shreyans Tejpal Shah

 6. Erection and installation 1 month
7. Initial Procurements and commissioning 1 month
8. Trial Runs and Production testing 1 Week

POLLUTION AND OTHER MATTERS

This project is a food project and does not generate any waste or effluent.

*****

Project Report of Soya Processing, prepared by CA Shreyans Tejpal Shah

 PROJECT REPORT OF SOYA PROCESSING

COST OF PROJECT : ₹ Lacs

Land & Development Own

Factory Building & Office 30.00

Extruder 21.00

Oil Press and Other Machinery & Fabrication 30.00

Electric Installation & MSEB Deposits 7.00

Other Assets 2.00

90.00

MEANS OF FINANCE :

Equity Share Capital 25.00

Bank Term Loan 65.00

90.00

REQUIREMENT OF WORKING CAPITAL

Raw Materials Stock : 15 Days 58.97

Finished Goods Stock : 2 Days 17.79
Stock in Process : 2 Day 17.62
Debtors : 15 Days 96.12

Creditors : 7 Days -40.50

150.00

Margin 40.00

Bank Finance 110.00

Cash Credit 110.00

Note: -
Stock Levels for working capital are calculated assuming 250 days of working due to seasonal nature of goods.

Project Report of Soya Processing, prepared by CA Shreyans Tejpal Shah

DEPRECIATION :
₹ Lacs

Building 10% 3.00

Machinery 20% 5.60

8.60

Capacity of Production: - Oil & Defatted Soya Meal

Capacity per day : 24.00 MT per Day

Capacity Utilisation : 90.00% 21.60 MT per Day

for 250 Working Days 6000.00 MT per year

Capacity Utilisation : 90.00% 5400.00 MT per year

Output - Soya Oil : 13.00% 702.00 MT per year

Output - Defatted Soya Meal : 82.00% 4428.00 MT per year

Raw Material :

Details Qty / Year Scale Rate ₹ Total ₹ Lacs

1. Soya Seed 5400.00 MT 39000.00 2106.00

Cost of Raw Material ₹ Lacs 2106.00

LABOUR Nos. Salary / month Month Total ₹ Lacs

Workers - Skilled / Operator 2 10000.00 12 2.40

Workers - Unskilled 8 6500.00 12 6.24

8.64

Project Report of Soya Processing, prepared by CA Shreyans Tejpal Shah

SALES

Qty MT / Year Rate ₹ Value (₹ Lacs)

2. Soya Oil 702.00 70000.00 491.40

3. Defatted Soya Meal 4428.00 41000.00 1815.48

2306.88

INTEREST :

Bank Term Loan @ 11.00% 7.15

Bank Cash Credit @ 11.00% 12.10

19.25

POWER

Lord Required 150.00 HP

Load Connected 111.90 KW

Maximum Demand 110.00 KW

Consumption per day 1815.00 Units

Consumption Per Year 453750.00 Units

Total Cost @ ₹ 8.50 38.57 ₹ Lacs

Project Report of Soya Processing, prepared by CA Shreyans Tejpal Shah

 PROFITABILITY STATEMENTS

Particulars ₹ Lacs

Sales 2306.88

Less :- Raw Material 2106.00

Labour 8.64

Power 38.57

Transportation @ ₹ 500 / MT 27.00

Spare Parts @ ₹ 200 / Ton 10.80

Maintenance & Handling @ 0.5 % 11.53

2202.54 2202.54

104.34
Less : T.L.Interest 7.15

C.C. Interest 12.10

Deperciation 8.60

Admin Exps 6.00

33.85 33.85

Net Profit Bef. Tax 70.49

Less :- Income Tax @ 30% 21.15

Net Profit After I. Tax Prov. 49.34

Add :Depreciation 8.60

CASH ACCRUALS 57.94

Loan Repayment 13.00

D.S.C.R. 3.23

Project Report of Soya Processing, prepared by CA Shreyans Tejpal Shah

 BREAK EVEN POINT ANALYSIS

₹ Lacs

I II III IV V

Fixed Costs

Depreciation 8.60 7.18 6.01 5.05 4.26

Interest on term loan 7.15 5.72 4.29 2.86 1.43

Wages / Salaries : Fixed : 80 % 6.91 7.60 8.36 9.20 10.12

Utilities : Fixed : 20 % 1.20 1.26 1.32 1.39 1.46

23.86 21.76 19.99 18.50 17.27

Variable Costs

Raw Material 2106.00 2211.30 2321.87 2437.96 2559.86

Mfg. Exps & Transportation 77.10 82.05 87.32 92.94 98.92

Salaries & Wages : Variable : 20% 1.73 1.90 2.09 2.30 2.53

Utilities : Variable : 80% 4.80 5.04 5.29 5.56 5.83

2189.63 2300.29 2416.57 2538.75 2667.14

Contribution 117.25 121.93 126.76 131.75 136.89

P/V ratio (contribution to sales) 0.05 0.05 0.05 0.05 0.05

Break even sales Rs.Lacs 469.49 432.34 401.08 375.05 353.77

Break Even Percentage 20.35% 17.85% 15.77% 14.04% 12.62%

Project Report of Soya Processing, prepared by CA Shreyans Tejpal Shah

 RATIO ANALYSIS
₹ Lacs
Particulars I II III IV V
RATIOS
Growth in Sales 5% 5% 5% 5%
Gross profit Ratio 4.52% 4.46% 4.40% 4.33% 4.26%
PBDIT 77.64 82.45 87.06 91.51 95.82
PBDIT/sales 3.37% 3.40% 3.42% 3.43% 3.42%
Operating Profits/Sales 3.37% 3.40% 3.42% 3.43% 3.42%
PBT/Sales 3.06% 3.17% 3.25% 3.32% 3.37%
PAT/Sales 2.14% 2.22% 2.28% 2.32% 2.36%
Cash Accruals/ Sales 2.51% 2.51% 2.51% 2.51% 2.51%
Sales/Equity 22.54 16.82 13.60 11.41 9.94
Sales / TTA 28.34 32.64 37.29 42.29 47.61
Interest Coverage (Interest/PBDIT) 810.36% 1064.51% 1490.70% 2346.36% 4918.64%
PBDIT / Interest (Times) 12.06 15.67 21.69 33.76 69.99
Deferred Debt/ Equity 0.00 0.00 0.00 0.00 0.00
TOL/Equity 1.58 1.03 0.73 0.53 0.39
Current Ratio (CA / CL) 1.49 1.78 2.07 1.78 1.67
Current Ratio excluding TL
1.66 1.99 2.32 1.99 1.67
Instalments
CA / TTA (%) 224.74% 294.84% 373.55% 346.60% 311.13%
Inentory+Receivables as days of
24 24 24 24 23
Net Sales
Bank Borrowings/Current Assets 60.13% 50.27% 43.17% 50.25% 60.04%
RM content in sales 91% 91% 91% 91% 91%
ROCE(PBDIT incl.Other
105.94% 120.76% 136.46% 152.90% 169.95%
income/TTA)

Project Report of Soya Processing, prepared by CA Shreyans Tejpal Shah

 PROJECT REPORT OF SOYA PROCESSING

PROFITABLITY STATEMENT (FIVE YEARS)

₹ in Lacs

PARTICUALRS I II III IV V
Utilization % 70% 73.500% 77.175% 81.034% 85.085%
Sales 2306.88 2422.22 2543.34 2670.50 2804.03

Less- Direct Expenditures

- Raw Material 2106.00 2211.30 2321.87 2437.96 2559.86

- Labour 8.64 9.50 10.45 11.50 12.65

- Power 38.57 41.31 44.24 47.38 50.75

- Spare Parts 10.80 11.34 11.91 12.50 13.13

- Maintenance & Handling 11.53 12.11 12.72 13.35 14.02

- Transportation 27.00 28.63 30.37 32.20 34.15

2202.54 2314.20 2431.55 2554.90 2684.55

Gross Profit 104.34 108.03 111.79 115.61 119.48

Less- Indirect Expenditure :

- Interest on T.L. 7.15 5.72 4.29 2.86 1.43

- Interest on C.C. 12.10 12.10 12.10 12.10 12.10

- Depreciation 8.60 7.18 6.01 5.05 4.26

- Admin Exps 6.00 6.30 6.62 6.95 7.29

33.85 31.30 29.02 26.96 25.09

Net Profit Before I. Tax 70.49 76.73 82.77 88.65 94.39

Less- I. Tax Provision 21.15 23.02 24.83 26.59 28.32

Net Profit After I. Tax prov. 49.34 53.71 57.94 62.05 66.07

Add- Depreciation 8.60 7.18 6.01 5.05 4.26

Cash Accruals 57.94 60.89 63.95 67.11 70.34

Loan Repayment 13.00 13.00 13.00 13.00 13.00

D.S.C.R. 3.23 3.56 3.95 4.41 4.97

Average D.S.C.R. 4.02

Project Report of Soya Processing, prepared by CA Shreyans Tejpal Shah

 CASH FLOW & FUND FLOW STATEMENT

₹ in Lacs

I II III IV V

Sources of Funds

Cash Accruals 57.94 60.89 63.95 67.11 70.34

Increas in Capital 65.00 0.00 0.00 0.00 0.00

Increase in Term Loan 65.00 0.00 0.00 0.00 0.00

Increase in Bank Borrowing 110.00 0.00 0.00 0.00 0.00

Increase in U/S Loan 0.00 0.00 0.00 0.00 0.00

Others - Import L/c 0.00 0.00 0.00 0.00 0.00

Total Application (A) 297.94 60.89 63.95 67.11 70.34

Dispossion of Funds

Pre-op Expenses 0.00 0.00 0.00 0.00 0.00

Increase in Capital Expenditure 90.00 0.00 0.00 75.00 75.00

Decrease in Term Loan 13.00 13.00 13.00 13.00 13.00

Withdrawals 12.00 12.00 15.00 15.00 18.00

Increase in Working Capital 150.00 7.50 7.50 7.50 7.50

Total Dispossion (B) 265.00 32.50 35.50 110.50 113.50

Opening Balance 0.00 32.94 61.33 89.78 46.39

Net Surplus (A-B) 32.94 28.39 28.45 -43.39 -43.16

Closing Balance 32.94 61.33 89.78 46.39 3.22

Project Report of Soya Processing, prepared by CA Shreyans Tejpal Shah

 PROJECTED BALANCE-SHEET

₹ in Lacs

Liabilities I II III IV V

Partners Capital 65.00 102.34 144.05 186.99 234.04

Profit for the Year 49.34 53.71 57.94 62.05 66.07

Less Withdrawals 12.00 12.00 15.00 15.00 18.00

Capital in Business 102.34 144.05 186.99 234.04 282.11

Term Loans 52.00 39.00 26.00 13.00 0.00

Bank Borrowing for W.C. 110.00 110.00 110.00 110.00 110.00

Other Liabilities (specify) 0.00 0.00 0.00 0.00 0.00

Total 264.34 293.05 322.99 357.04 392.11

Assets :

Gross Block 90.00 90.00 90.00 90.00 90.00

Depreciation 8.60 15.78 21.79 26.85 31.11

Net Block 81.40 74.22 68.21 63.15 58.89

Capital WIP 0.00 0.00 0.00 75.00 150.00

Current Assets 150.00 157.50 165.00 172.50 180.00

Cash & Bank balance 32.94 61.33 89.78 46.39 3.22

264.34 293.05 322.99 357.04 392.11

0.00 0.00 0.00 0.00 0.00

Note: -
Capital WIP denotes proposed expansion in future.

Project Report of Soya Processing, prepared by CA Shreyans Tejpal Shah

 INTEREST SCHEDULE :

₹ Lacs

PARTICULARS TERM LOAN INTEREST CASH CREDIT INTEREST

11.00% 11.00%

BALANCE 65.00 110.00

[-] 1st Yr. Installment 13.00 7.15 0.00 12.10

BALANCE 52.00 110.00

[-] 2nd Yr. Installment 13.00 5.72 0.00 12.10

BALANCE 39.00 110.00

[-] 3rd Yr. Installment 13.00 4.29 0.00 12.10

BALANCE 26.00 110.00

[-] 4th Yr. Installment 13.00 2.86 0.00 12.10

BALANCE 13.00 110.00

[-] 5th Yr. Installment 13.00 1.43 0.00 12.10

BALANCE 0.00 110.00

Project Report of Soya Processing, prepared by CA Shreyans Tejpal Shah

 DEPRECIATION SCHEDULE

₹ Lacs

PATICULARS Building Machinery Total Depre

10% 20%

OP.BALANCE 30.00 28.00

[-] 1st YR. Depr. 3.00 5.60 8.60

W.D.V. 27.00 22.40

[-] 2nd Yr. Depr. 2.70 4.48 7.18

W.D.V. 24.30 17.92

[-] 3rd YR. Depr. 2.43 3.58 6.01

W.D.V. 21.87 14.34

[-] 4th Yr. Depr. 2.19 2.87 5.05

WDV 19.68 11.47

[-] 5th Yr. Depr. 1.97 2.29 4.26

WDV 17.71 9.18

Project Report of Soya Processing, prepared by CA Shreyans Tejpal Shah