Pre-Feasibility Study

Transcription

1 Pre-Feasibility Study () Small and Medium Enterprises Development Authority Ministry of Industries & Production Government of Pakistan HEAD OFFICE 4th Floor, Building No. 3, Aiwan-e-Iqbal Complex, Egerton Road, Lahore Tel: (92 42) , Fax: (92 42) REGIONAL OFFICE Punjab 3 rd Floor, Building No. 3, Aiwan-e-Iqbal Complex, Egerton Road Lahore, Tel: (042) Fax: (042) helpdesk.punjab@smeda.org.pk REGIONAL OFFICE Sindh 5 th Floor, Bahria Complex II, M.T. Khan Road, Karachi. Tel: (021) Fax: (021) helpdesk-khi@smeda.org.pk REGIONAL OFFICE Khyber Pakhtunkhwa Ground Floor State Life Building The Mall, Peshawar. Tel: (091) Fax: (091) helpdesk-pew@smeda.org.pk REGIONAL OFFICE Balochistan Bungalow No. 15-A Chaman Housing Scheme Airport Road, Quetta. Tel: (081) , Fax: (081) helpdesk-qta@smeda.org.pk Note: All SMEDA Services / information related to PM's Youth Business Loan are Free of Cost December, 2013

2 Table of Contents 1. DISCLAIMER PURPOSE OF THE DOCUMENT INTRODUCTION TO SMEDA INTRODUCTION TO SCHEME EXECUTIVE SUMMARY BRIEF DESCRIPTION OF PROJECT & PRODUCT CRITICAL FACTORS INSTALLED & OPERATIONAL CAPACITIES GEOGRAPHICAL POTENTIAL FOR INVESTMENT POTENTIAL TARGET MARKETS & CITIES PROJECT COST SUMMARY PROJECT ECONOMICS PROJECT FINANCING PROJECT COST SPACE REQUIREMENT EQUIPMENT REQUIREMENT FURNITURE & FIXTURES REQUIREMENT HUMAN RESOURCE REQUIREMENT REVENUE GENERATION OTHER COSTS (PROJECTED GROWTH RATES) CONTACT DETAILS OF DAY CARE CENTRE EQUIPMENT SUPPLIERS ANNEXURE INCOME STATEMENT BALANCE SHEET STATEMENT OF CASH FLOW USEFUL PROJECT MANAGEMENT TIPS USEFUL LINKS KEY ASSUMPTIONS... 16

3 1. DISCLAIMER This information memorandum is to introduce the subject matter and provide a general idea and information on the said subject. Although, the material included in this document is based on data / information gathered from various reliable sources; however, it is based upon certain assumptions which may differ from case to case. The information has been provided on as is where is basis without any warranties or assertions as to the correctness or soundness thereof. Although, due care and diligence has been taken to compile this document, the contained information may vary due to any change in any of the concerned factors, and the actual results may differ substantially from the presented information. SMEDA, its employees or agents do not assume any liability for any financial or other loss resulting from this memorandum in consequence of undertaking this activity. The contained information does not preclude any further professional advice. The prospective user of this memorandum is encouraged to carry out additional diligence and gather any information which is necessary for making an informed decision, including taking professional advice from a qualified consultant / technical expert before taking any decision to act upon the information. For more information on services offered by SMEDA, please contact our website: SMEDA Services / Information related to PM s Youth Business Loan are FREE OF COST - 2

4 2. PURPOSE OF THE DOCUMENT The objective of the pre-feasibility study is primarily to facilitate potential entrepreneurs in project identification for investment. The project pre-feasibility may form the basis of an important investment decision and in order to serve this objective, the document / study covers various aspects of project concept development, start-up, production, marketing, finance and business management. The purpose of this document is to facilitate potential investors in by providing them a general understanding of the business with the intention of supporting potential investors in crucial investment decisions. The need to come up with pre-feasibility reports for undocumented or minimally documented sectors attains greater imminence as the research that precedes such reports reveal certain thumb rules; best practices developed by existing enterprises by trial and error, and certain industrial norms that become a guiding source regarding various aspects of business set-up and it s successful management. Apart from carefully studying the whole document, one must consider critical aspects provided later on, which form basis of any investment decision. 3. INTRODUCTION TO SMEDA The Small and Medium Enterprises Development Authority (SMEDA) was established in October 1998 with an objective to provide fresh impetus to the economy through development of Small and Medium Enterprises (SMEs). With a mission "to assist in employment generation and value addition to the national income, through development of the SME sector, by helping increase the number, scale and competitiveness of SMEs", SMEDA has carried out sectoral research to identify policy, access to finance, business development services, strategic initiatives, institutional collaboration and networking initiatives. Preparation and dissemination of prefeasibility studies in key areas of investment has been a hallmark of SME facilitation by SMEDA. Concurrent to the prefeasibility studies, a broad spectrum of business development services is also offered to the SMEs by SMEDA. These services include identification of experts and consultants and delivery of need based capacity building programs of different types in addition to business guidance through help desk services. SMEDA Services / Information related to PM s Youth Business Loan are FREE OF COST - 3

5 4. INTRODUCTION TO SCHEME Prime Minister s Youth Business Loan, for young entrepreneurs, with an allocated budget of Rs. 5.0 Billion for the year , is designed to provide subsidised financing at 8% mark-up per annum for one hundred thousand (100,000) beneficiaries, through designated financial institutions, initially by The National Bank of Pakistan (NBP) and The First Women Bank Limited. (FWBL). Small business loans from Rs. 0.1 million to Rs. 2.0 million with tenure up to 8 years, inclusive of grace period of 1 year, and a debt : equity of 90 : 10 will be disbursed to SME beneficiaries across Pakistan, covering; Punjab, Sindh, Khyber Pakhtunkhwah, Balochistan, Gilgit Baltistan, Azad Jammu & Kashmir and Federally Administered Tribal Areas (FATA). 5. EXECUTIVE SUMMARY Life, today, is characterized by independent family system, need for improved living standards, quality education for children, etc., resulting in increased pressure on working women to efficiently manage both their professional and domestic responsibilities. The demand for day care centers is on the rise, specifically by working mothers (doctors, business women, government servants, corporate employees, teachers, etc), and the service is deemed as a profitable entrepreneurship opportunity. is proposed to be located in major cities such as Islamabad, Lahore, Karachi, Peshawar, Multan, Gujranwala, Sialkot and Quetta etc. The project features a facility and its ancillary services for children aged 6 months to 5 years in a hygienic and activity based educational environment, facilitated through trained and educated staff. The project can be used for a maximum of 40 enrolments, however, keeping in view the rationale and demand; calculations have been made on the assumption of 24 enrolments for the first year of operations. Total cost estimate of the project is Rs Million with fixed investment of Rs Million and working capital of Rs Million. Given the cost assumptions, IRR, payback period and NPV are 38%, 3.85 years and Rs million respectively. The project will generate direct employment opportunity for 06 persons. Higher return on investment and a steady growth of business is expected with the entrepreneur (especially women) having some prior experience in the related field of business. SMEDA Services / Information related to PM s Youth Business Loan are FREE OF COST - 4

6 6. BRIEF DESCRIPTION OF PROJECT & PRODUCT The fast paced life of the cities is significantly influencing the life style of its inhabitants. Economic pressures are compelling both parents to work towards achieving and sustaining quality life standards. This has further added to complexity and competition of any metropolitan city. As a result of these social changes, the trend of sending children to Day Care Centres at a much earlier age is gaining rapid acceptance. This pre-feasibility study provides basic information for setting-up a day care centre with modern learning techniques and extracurricular activities. The proposed centre will offer a hygienic and efficiently managed care facility for children aged 6 months to 5 years. The centre would have the maximum capacity of providing service to 40 children; however, it assumed that 24 enrolments would be made during first year of its operation. The proposed centre is recommended to be established in a rented building, preferably lower portion of one kanal house (4,500 sq.ft. area) with a reasonable front / back yard. The total project cost for setting up this centre is estimated at Rs million, out of which, the capital cost is estimated at Rs million and working capital of Rs million. The project is financed through 90% debt and 10% equity. The project NPV is around Rs million with an IRR of 38% and payback period of 3.85 years. 7. CRITICAL FACTORS The proposed project has following factors critical to success; Secured, hazard free, and kids friendly environment is provided at center. Interior of Center should be designed to attract kids attention and promote learning. Like colorful walls with educational material, pasting theme oriented chart papers, and any other cost effective mode deem appropriate. Developing plan of daily activities of enrolled kids. Extra care should be given to keep the place hygienic, and clean. Location of the center in a commercial area. Opening of center with proper launch and promotional material. Hiring of a well-trained / experienced care provider for kids. Establishment of the Center in a rented building to reduce the project cost. Parents are informed immediately in case of strike, kid is unwell (fever, flue, diarrhea, etc.), diaper rash and any other observation important for child development. SMEDA Services / Information related to PM s Youth Business Loan are FREE OF COST - 5

7 Frequent interaction between care provider and parent. 8. INSTALLED & OPERATIONAL CAPACITIES It is proposed that infants of age more than 6 months and children of ages up to 5 years may be enrolled in the center. The centre will have a maximum capacity of 40 enrolments. Initially, the overall utilization in the first year of operation would be 60% (i.e. 24 kids would be enrolled). This capacity is assumed to grow at a constant rate of 5% in subsequent years. 9. GEOGRAPHICAL POTENTIAL FOR INVESTMENT The increasing population and high concentration of educated / working class in major cities like Karachi, Lahore, Islamabad, Peshawar, Quetta, Multan, Gujranwala, etc., offers a very lucrative business opportunity for opening up well planned Day Care Centres. However, it is recommended that the centre should be located in an easily approachable location, in line with the selected target market. 10. POTENTIAL TARGET MARKETS & CITIES The target market for the proposed centre is working couple having infants of age more than 6 months to children of ages up to 5 years. The business community also has a positive response towards the idea of day care center due to their busy schedules and, therefore, can be targeted as potential customers. Keeping in view the economic and social factors, it is recommended that the proposed project may be established in major cities such as Islamabad, Lahore, Quetta, Karachi, Multan, and Peshawar. However the project may also be opened in other cities and towns after careful market analysis. 11. PROJECT COST SUMMARY A detailed financial model has been developed to analyze the commercial viability of under the Prime Minister s Youth Business Loan. Various cost and revenue related assumptions along with results of the analysis are outlined in this section. The projected Income Statement, Cash Flow Statement and Balance Sheet are attached as appendices. SMEDA Services / Information related to PM s Youth Business Loan are FREE OF COST - 6

8 11.1 Project Economics The proposed venture has the capacity of 40 enrolments, however, a target of 24 enrolments is assumed in year 01 of the proposed center. The following table shows internal rate of return and payback period. Table 1: Project Economics Description Details Internal Rate of Return (IRR) 38% Payback Period (yrs) 3.85 Net Present Value (NPV) Rs. 3,781,804 Returns on the scheme and its profitability are highly dependent on the efficiency of operations, location, staff, hygienic environment, safety, curricular and extracurricular activities, etc Project Financing Following table provides details of the equity required and variables related to bank loan; Total Equity (10%) Bank Loan (90%) Table 2: Project Financing Description Details Rs.198,237 Rs.1,784,129 Markup to the Borrower 8% Tenure of the Loan (Years) 8 Grace period (year) Project Cost Following requirements have been identified for operations of the proposed business. Table 3: Capital Investment for the Project Capital Investment Amount (Rs.) Office Equipment 5,000 Furniture & Fixtures 588,000 SMEDA Services / Information related to PM s Youth Business Loan are FREE OF COST - 7

9 Machinery & Equipment 369,000 Pre Operating Cost 110,365 Total Capital Costs 1,072,365 Initial Working Capital 910,000 Total Project Cost 1,982, Space Requirement It is recommended that the proposed project should be established in a rented building, preferably lower portion of a one kanal house (4,500 sq.ft. area) with two bedrooms and attached bath, one drawing, one dining room, one kitchen and a reasonable front / back yard. The rent for the building is estimated at Rs. 55,000 per month. Description Table 4: Space Requirement Area (Sq.ft.) Building Covered Area 2,000 Play Area / Grounds 2,500 Total Required Area 4, Equipment Requirement The basic requirements for a day care center include activity based equipment for outdoor/play area activities (slides, merry-go-round and swings etc.), equipment for indoor activities (soft boards, white boards, books, paints, char papers, colours, blocks, educational toys, etc.), kitchen equipment (microwave, refrigerator, utensils, etc.), entertainment equipment (T.V., DVD player) and sleeping cots / beds, all of which are readily available in the local market. Details of the equipment are given as below; Table 5: Equipment Required for Center and Office Equipment Details Qty Cost/Unit Total Cost Slide (iron) 1 15,000 15,000 Merry-go-round 1 20,000 20,000 Swings (Outdoor) (3 seater) 2 30,000 60,000 Monkey bar 2 10,000 20,000 Baby eating seat 2 8,000 16,000 Baby rocker / swing chair 2 4,000 8,000 Sleeping cot 3 10,000 30,000 Beds (single + mattress) 5 8,000 40,000 White board 5 1,500 7,500 SMEDA Services / Information related to PM s Youth Business Loan are FREE OF COST - 8

10 Soft boards 5 1,500 7,500 Cooking range / Burner stove 1 3,000 3,000 Microwave 1 7,000 7,000 Refrigerator 1 25,000 25,000 Kitchen utensils 1 10,000 10,000 Miscellaneous (books, colors, paints, toys, 1 100, ,000 Total 369, Furniture & Fixtures Requirement Furniture & fixtures requirement for the project is detailed as under: Table 6: Furniture & Fixture Detail Description Qty Cost/Unit Total Cost (Rs.) Office chairs 2 5,000 10,000 Office table 1 10,000 10,000 Sofa cum bed 2 10,000 20,000 Seating chairs (children) 24 2,000 48,000 Study table (indoor) 2 10,000 20,000 Book rack (Library) 2 5,000 10,000 Eating table (8 chairs) 2 15,000 30,000 Carpeting (sq.ft.) 3, ,000 Electric wiring & lighting 1 10,000 10,000 Television 1 40,000 40,000 DVD Player 1 10,000 10,000 Air conditioners (1.5 ton window) 4 55, ,000 UPS (3KVA) with batteries 1 70,000 70,000 Total Furniture & Fixtures 588, Human Resource Requirement The manpower required for operating the is as follows: SMEDA Services / Information related to PM s Youth Business Loan are FREE OF COST - 9

11 Table 7: Human Resource Detail Description Quantity Monthly Salary / employee (Rs.) Total Monthly Salary (Rs.) Owner / Manager 1 20,000 20,000 Nannies ,000 60,000 Helper / Junior staff 1 10,000 10,000 Guard 1 10,000 10,000 Total 8 100,000 It is highly recommended that nannies should be qualified females so that parents can be assured of about their child s proper care and safety. The nannies should be at least intermediate pass with good communication skills and empathy for children, and preferably trained for child care. Moreover, the owner/manager should develop a daily plan for kids activities including: One hour circle time daily full of action, music and fun for kids (covering nursery rhymes, alphabets/colors/number recognition songs and physical moves acted together kids and caregivers) Colouring, pasting, and painting activities Share with kids concept of different festivals of Pakistan (Pakistan day, Eid, Iqbal Day, Quaid-e-Azam Day, etc) Also give them other basic ideas regarding family, places, senses, body parts, manners, greetings, sharing, seasons, days, transport, animals, etc. Play time (indoor & outdoor) Nap time Dinning (Breakfast, lunch, tea time, and for infants feed every 2 hours) Diaper change every 3-4 hours or as desired. Each child Parent be asked to send a daily diary to record daily report of their child. This will include recording child meal times and quantity eaten, milk/ water intake time and ounces consumed, theme of the week, diaper changes, any unusual occurrence (fever, vomit, fight, etc) Revenue Generation It is proposed that infants of more than 6 months of ages to children of 5 years of ages be enrolled in the center. The project would have a total capacity of 40 enrollments. 1 It is assumed that 1 nanny is required for 4-5 children. SMEDA Services / Information related to PM s Youth Business Loan are FREE OF COST - 10

12 However, keeping in view market research and analysis, it is assumed that project capacity would be 24 enrolments in year 01 of its operation. Table 8: Revenue Detail Fees / month (Rs./Unit) First Year Enrolment Monthly Revenue (Rs) 10, ,000 Annual Revenue 2,880, Other Costs (Projected Growth Rates) The primary overhead cost of the project would be utilities comprising electricity, gas & water, whereas cost of fuel must be kept in mind for generator expenses. Table 9: Costs Projection Electricity Price Growth Rate 10% Gas Price Growth Rate 10% Water Price Growth Rate 10% Salary Growth Rate 10% Rent Growth Rate 10% Fee Growth Rate 10% 12. CONTACT DETAILS OF DAY CARE CENTRE EQUIPMENT SUPPLIERS Below is the list of major suppliers of Children Toys for : Babyland Toys 1st Floor, Sheikh Innayat-Ullah Building, Liberty Market, Gulberg 3, Lahore, Pakistan Tel: , Mob: Kaymu Toys Arfa Software Technology Park Ferozpur Road, Lahore, Pakistan Tel: Other local wholesale market in different cities maybe contacted for the said purpose. SMEDA Services / Information related to PM s Youth Business Loan are FREE OF COST - 11

13 13. ANNEXURE 13.1 Income Statement Calculations Income Statement SMEDA Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10 Revenue 2,880,000 3,432,000 4,065,600 4,791,600 5,622,144 6,570,881 7,653,144 8,418,458 9,260,304 10,186,334 Cost of sales Operation costs 1 (direct labor) 840,000 1,082,400 1,190,640 1,309,704 1,651,505 1,816,655 2,253,426 2,478,768 2,726,645 2,999,309 Total cost of sales 840,000 1,082,400 1,190,640 1,309,704 1,651,505 1,816,655 2,253,426 2,478,768 2,726,645 2,999,309 Gross Profit 2,040,000 2,349,600 2,874,960 3,481,896 3,970,639 4,754,226 5,399,718 5,939,690 6,533,659 7,187,025 General administration & selling expenses Administration expense 360, , , , , , , , , ,861 Building rental expense 660, , , , ,306 1,062,937 1,169,230 1,286,153 1,414,769 1,556,245 Electricity expense 480, , , , , , , ,384 1,028,923 1,131,815 Water expense 36,000 39,600 43,560 47,916 52,708 57,978 63,776 70,154 77,169 84,886 Gas expense 84,000 92, , , , , , , , ,068 Promotional expense 57,600 68,640 81,312 95, , , , , , ,727 Depreciation expense 96,200 96,200 96,200 96, , , , , , ,427 Amortization of pre-operating costs 22,073 22,073 22,073 22,073 22, Miscellaneous expense 1 60,000 66,000 72,600 79,860 87,846 96, , , , ,477 Subtotal 1,855,873 2,034,913 2,232,385 2,450,185 2,705,631 2,948,501 3,240,712 3,553,641 3,897,862 4,276,505 Operating Income 184, , ,575 1,031,711 1,265,009 1,805,724 2,159,006 2,386,049 2,635,797 2,910,519 Earnings Before Interest & Taxes 184, , ,575 1,031,711 1,265,009 1,805,724 2,159,006 2,386,049 2,635,797 2,910,519 Interest expense on long term debt (Project Loan) 80,105 73,337 64,442 54,808 44,374 33,075 20,838 7, Interest expense on long term debt (Working Capital Loan) 67,977 62,233 54,685 46,509 37,656 28,067 17,683 6, Subtotal 148, , , ,317 82,030 61,142 38,520 14, Earnings Before Tax 36, , , ,394 1,182,979 1,744,582 2,120,485 2,372,028 2,635,797 2,910,519 Tax ,345 62,059 99, , , , , ,130 NET PROFIT/(LOSS) AFTER TAX 36, , , ,335 1,083,032 1,548,166 1,848,889 2,050,123 2,254,348 2,460,390 SMEDA Services / Information related to PM s Youth Business Loan are FREE OF COST - 12

14 13.2 Balance Sheet Calculations Balance Sheet SMEDA Year 0 Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10 Assets Current assets Cash & Bank 250, , , ,934 1,214,053 2,082,290 3,363,038 4,911,256 6,624,518 8,848,815 12,976,877 Pre-paid building rent 660, , , , ,306 1,062,937 1,169,230 1,286,153 1,414,769 1,556,245 - Total Current Assets 910,000 1,064,318 1,163,584 1,578,394 2,180,359 3,145,227 4,532,268 6,197,410 8,039,286 10,405,061 12,976,877 Fixed assets Machinery & equipment 369, , , , , , , , , ,033 60,907 Furniture & fixtures 588, , , , , , , , ,600 58,800 - Office equipment 5,000 4,500 4,000 3,500 3,000 2,500 2,000 1,500 1, Total Fixed Assets 962, , , , , , , , , ,333 60,907 Intangible assets Pre-operation costs 110,365 88,292 66,219 44,146 22, Legal, licensing, & training costs Total Intangible Assets 110,365 88,292 66,219 44,146 22, TOTAL ASSETS 1,982,365 2,018,410 1,999,404 2,295,940 2,931,898 3,763,266 5,038,881 6,592,596 8,323,046 10,577,394 13,037,784 Liabilities & Shareholders' Equity Current liabilities Total Current Liabilities Other liabilities Long term debt (Project Loan) 965, , , , , , , , Long term debt (Working Capital Loan) 819, , , , , , , , Total Long Term Liabilities 1,784,129 1,784,129 1,586,005 1,371,438 1,139, , , , Shareholders' equity Paid-up capital 198, , , , , , , , , , ,237 Retained earnings 36, , ,266 1,594,601 2,677,633 4,225,799 6,074,687 8,124,810 10,379,158 12,839,547 Total Equity 198, , , ,502 1,792,837 2,875,869 4,424,035 6,272,924 8,323,046 10,577,394 13,037,784 TOTAL CAPITAL AND LIABILITIES 1,982,365 2,018,410 1,999,404 2,295,940 2,931,898 3,763,266 5,038,881 6,592,596 8,323,046 10,577,394 13,037,784 SMEDA Services / Information related to PM s Youth Business Loan are FREE OF COST - 13

15 13.3 Statement of Cash Flow Calculations Cash Flow Statement SMEDA Year 0 Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10 Operating activities Net profit 36, , , ,335 1,083,032 1,548,166 1,848,889 2,050,123 2,254,348 2,460,390 Add: depreciation expense 96,200 96,200 96,200 96, , , , , , ,427 amortization of pre-operating costs 22,073 22,073 22,073 22,073 22, Deferred income tax Pre-paid building rent (660,000) (66,000) (72,600) (79,860) (87,846) (96,631) (106,294) (116,923) (128,615) (141,477) 1,556,245 Cash provided by operations (660,000) 88, , , ,762 1,119,901 1,553,299 1,843,392 2,032,934 2,224,298 4,128,062 Financing activities Project Loan - principal repayment - (107,175) (116,071) (125,705) (136,138) (147,437) (159,675) (172,928) - - Working Capital Loan - principal repayment - (90,948) (98,497) (106,672) (115,526) (125,114) (135,499) (146,745) - - Additions to Project Loan 965, Additions to Working Capital Loan 819, Issuance of shares 198, Cash provided by / (used for) financing activities 1,982,365 - (198,123) (214,568) (232,377) (251,664) (272,552) (295,173) (319,673) - - Investing activities Capital expenditure (1,072,365) (152,266) Acquisitions Cash (used for) / provided by investing activities (1,072,365) (152,266) NET CASH 250,000 88,318 26, , , ,237 1,280,747 1,548,219 1,713,261 2,224,298 4,128,062 SMEDA Services / Information related to PM s Youth Business Loan are FREE OF COST - 14

16 13.4 Useful Project Management Tips Human Resources Adequacy & Competencies: Skilled and experienced staff should be considered an investment even to the extent of offering share in business profit. Performance Based Remuneration: Attempt to manage human resource cost should be focused through performance measurement and performance based compensation. Marketing Ads & P.O.S. Promotion: Business promotion and dissemination through banners, and launch events is highly recommended. Product brochures from good quality service providers. Also, have facebook page which is updated regularly Useful Links Prime Minister s Office, Small and Medium Enterprise Development Authority, The National Bank of Pakistan (NBP), The First Women Bank Limited (FWBL), Government of Pakistan, Ministry of Industries & Production, Ministry of Education, Training & Standards in Higher Education, Government of Punjab, Government of Sindh, Government of Khyber Pakhtunkhwa, Government of Balochistan, Government of Gilgit Baltistan, Government of Azad Jammu & Kashmir, Trade Development Authority of Pakistan (TDAP), Securities & Exchange Commission of Pakistan (SECP), SMEDA Services / Information related to PM s Youth Business Loan are FREE OF COST - 15

17 Federation of Pakistan Chambers and Commerce and Industries (FPCCI), State Bank of Pakistan (SBP), All Pakistan Private Schools Welfare Association (APPSWA), Montessori Education Pakistan, Pakistan Montessori Association, KEY ASSUMPTIONS Particular Sales Price Growth Rate Capacity Utilization Growth Rate Increase in utilities (Electricity/Water/Gas Assumptions 10 % per year 5 % per year 10 % per year Debt / Equity Ratio 90 : 10 Depreciation Rate Machinery Office Furniture & Equipment Loan Period Loan installments 10 % per year 10 % per year 8 Years inclusive of 1 year grace period Monthly Enrolment Capacity 40 Enrolment Capacity Year 1 24 Financial Charges (Loan Rate) 8 % per year SMEDA Services / Information related to PM s Youth Business Loan are FREE OF COST - 16