Model Detailed Project Report

NAMKEEN MANUFACTURING UNIT

Prepared by

Naresh Shrestha
Lagankhel, Lalitpur
9851003806
1. INTRODUCTION

NAMKEEN MANUFACTURING UNIT

Namkeen is the Hindi word used to describe a savory flavor. The word
namkeen is derived from the word Namak (meaning salt). Namkeen is also
used as a generic term to describe savory snack foods. Both black and
regular white salt are used in Indian cooking, which gives it the salty flavor
many people like. Other namkeen snacks common in Indian cuisine include
khaara, farsan, chivda, sav, chips and bhujiya. Namkeen of Indore and
Ratlam are two snacks that are very well known for their tastes.

Namkeen foods are typically designed to be portable, quick, and satisfying.

Processed snack foods, as one form of convenience food, are designed to
be less perishable, more durable, and more portable than prepared foods.
They often contain substantial amounts of sweeteners, preservatives, and
appealing ingredients such as chocolate, peanuts, and specially-designed
flavors.
2. MARKET POTENTIAL:

Nepal traditional snacks market has shown tremendous growth in the past
couple of years. The market is forecasted to grow with a CAGR of more
than 7% in near future. Increasing consumer's awareness towards healthy
and packaged traditional snacks has created a huge demand for Namkeen
in past couple of years.

Namkeen is the dominant segment, followed by the Extruded Snacks. The

market is also segmented into organized and unorganized sector of which
unorganized is the dominant market.

The Nepal Snacks Market will be more than NER 10 Crores by the end of
2024. At present Unorganized market is dominating the Nepal snacks
market. But this scenario is expected to change during the forecast period
of 2020-2024. Nepal Snacks Market is growing due to following factors
Lifestyle Changes, Rising Urbanization, Growing Middle Class Population,
Local Availability and Availability of Snacks in Small Package Size, Low
Price and Company’s Strategies to focus on regional taste.

3. PRODUCT DESCRIPTION

3.1 PRODUCT TYPES & SIZE

Neplease consumers seem to have recovered their taste for traditional

snacks such as sev, bhujia and namkeen/ mixtures, which are contributing
to the impressive growth rate of the firms.
To elaborate further, namkeens can be characterized into three segments
as:

• Single product segment: Moong Dal, Chana Dal, Peanut, Nut Cracker,
Karare Peanut, Heeng Jeera Peanut, Masala Matar, Mathri, Namkeen
Pare, etc.
• Single product in bhujia: Plain Sev, Bikaneri Bhujia, Aloo Bhujia,
Punjabi Tadka, Ratlami Sev, Bhavnagri Gathiya, etc.
• Lots of mix: Navratan Mix, Khatta Meetha, Chatpata Mix, Magic Mix,
Royal Treat, Kanpuri Mix, Bombay Mix, Kaju Mix, Kashmiri Mix, All in
One, etc.

Now Namkeen is well known to each and every part of our geography.
South and North East part of India has good demand of Namkeen because
of mix culture.

Size of the product

Namkeen products are packed in different types of packaging product with

different sizes.

Pouch Packaging Size

• 50 gram
• 100 gram
• 250 gram
• 500 gram
• 1 KG
3.2 Raw Material Requirement
S.N. Particulars Rate per KG

1 Besan 140-150

2 Oil 230

3 Spices 200-250

5 Dal 250

6 Peanut 300

7 Potato 75

Average raw material cost per KG: Rs. 180

3.3 MANUFACTURING PROCESS

• Procurement of raw material.

• Preparation of dough with the help of dough mixer.
• Then with the help of Bhujia machine extruder convert the
dough into the shape of required namkeen.
• After that take it into the frying section.
• Drying of namkeen
• After frying, mix all the other ingredients like: peanut, spices
etc.
as per the different taste of the namkeen.
• Seasoning of namkeen with the help of seasoning machine.
• Packaging of goods.
• Transportation.
4. PROJECT COMPONENTS

4.1 Land

Land required 1200-1500 square feet approx.

Approximate rent for the same is Rs.25000-30000 per month.

4.2 Plant & Machinery
Machine Description Image

Dough Mixer Used for quickly

mixing batches of
dough or batter.

Bhujia extruder This machine is useful

Machine for extruding sev, papdi,
ganthia etc.
The machine is fitted
over frying pan.

Rectangular batch Used for

tilting fryer with diesel processing various
Burner types of namkeen
 Seasoning drum Seasoning machine can
be used to season and
mix all kinds of
Namkeen. It can mix and
season food evenly and
then discharge them
automatically.

Packaging Machine For packaging of

namkeen into different
size and types of
packets.

Note: Cost of the machine is approx. Rs. 12,00,000 excluding GST and
other Transportation cost.

4.3 Misc. Assets

S.N. Item Description Rate

1 electricity connection 70,000

2 Furniture and equipment’s 50,000

3 Storage tank, collection tank etc. 30,000

4.4 Power Requirement

The borrower shall require power load of 15 KW which shall be applied with
Power Corporation. However, for standby power arrangement the borrower
shall also purchase DG Set.

4.5 Manpower Requirement

6-7 Manpower are required for the Namkeen Manufacturing unit.

Includes:

2 Skilled Labour

2 Unskilled Labour

2 Helper

1 Accountant
5. FINANCIALS

5.1 Cost of Project

COST OF PROJECT
(in Lacs)

Own Bank
PARTICULARS AMOUNT Contribution Finance
25.00% 75.00%
Land & Building Owned /rented
Plant & Machinery 20.00 5.00 15.00
Furniture & Fixtures and Other Assets 2.00 0.50 1.50
Working capital 8.00 2.00 6.00
Total 30.00 7.50 22.50

5.2 Means of Finance

MEANS OF FINANCE
PARTICULARS AMOUNT

Own Contribution 7.50

Bank Loan 17.50

Working capital Limit 5.00

Total 30.00
 Projected Balance Sheet
PROJECTED BALANCE
(in Lacs)
SHEET
PARTICULARS 1st year 2nd year 3rd year 4th year 5th year
Liabilities
Capital opening balance
21.18 60.85 110.24 166.25

Add:- Own Capital -

7.50

Add:- Retained Profit

15.68 64.85 116.24 174.25 237.42

Less:- Drawings
2.00 4.00 6.00 8.00 12.00
Closing Balance
21.18 60.85 110.24 166.25 391.67

Bank Loan - - -
18.74 8.28
Sundry Creditors
4.00 5.00 6.00 7.00 8.00
Provisions & Other Liab
16.00 66.00 117.00 175.00 238.00
TOTAL :
59.92 140.13 233.24 348.25 637.67
Assets
Fixed Assets ( Gross)
22.00 16.60 12.58 9.55 7.27
Gross Dep.
5.40 4.02 3.03 2.28 1.72
Net Fixed Assets
16.60 12.58 9.55 7.27 5.55
Current Assets
Sundry Debtors
5.00 7.00 8.00 10.00 20.00
Stock in Hand
1.80 1.66 1.91 2.17 2.45
Cash and Bank
36.52 118.89 213.78 328.81 609.67
TOTAL :
59.92 140.13 233.24 348.25 637.67
 Projected Profitability
PROJECTED PROFITABILITY
(in Lacs)
STATEMENT
PARTICULARS 1st year 2nd year 3rd year 4th year 5th year
Capacity Utilisation % 10% 20% 30% 40% 50%
SALES
Gross Sale
Namkeen 173 371 587 824 1084

Total 173 371 587 824 1084

COST OF SALES
43.2 90. 142. 200. 262.
Raw Material Consumed
0 72 88 04 55
Electricity Expenses 3.6 4.14 4.76 5.48 6.02
5. 4. 3. 2. 1.7
Depreciation
40 02 03 28 2
Wages & labour 12 14 16 18 20
Repair & maintenance 3 4 5 6 7
packaging 16.8 38.4 64.8 91.2 120
84.0 155.2 236.4 323.0 417.2
Cost of Production
0 8 7 0 9
Add: Opening Stock /WIP - 2 3.5 4.5 5.5
Less: Closing Stock /WIP 2 3.5 4.5 5.5 6
82.0 153.7 235.4 322.0 416.7
Cost of Sales
0 8 7 0 9
90.5 217.2 351.9 502.4 666.9
GROSS PROFIT
0 9 4 6 6
Salary to Staff 12 14 16 18 20
Interest 2.24 1.54 0.37
Rent 3.6 3.96 4.36 4.79 5.27
51.7 111.3 176.2 247.3 325.1
selling & adm exp
5 2 2 4 2
69.5 130.8 196.9 270.1 350.3
TOTAL
9 2 5 3 9
20.9 86.4 154.9 232.3 316.5
NET PROFIT
1 7 9 3 6
5.2 21.6 38.7 58.0 79.1
Taxation
3 2 5 8 4

15.6 64.8 116.2 174.2 237.4

PROFIT (After Tax)
8 5 4 5 2
5.6 Production and Yield
COMPUTATION OF PRODUCTION OF
NAMKEEN

Items to be Manufactured
Namkeen
Production capacity 100 KG per
Hour
Working hours per day 8
machine capacity per day 800 KG

machine capacity per annum 240000 KG

wastage 5% Of Input

Raw Material Requirement 252632 KG

Final Product
One Packet size (assumed) 100 Gram
s
Total Packets per annum 2400000 Packets

Production of Namkeen
Production Packets
Capacity
1st year 10% 240,000
2nd year 20% 480,000
3rd year 30% 720,000
4th year 40% 960,000
5th year 50% 1,200,000

Raw Material Cost

Rat
Year Capacity Amount
e
Utilisatio (per (Rs. in
n KG) lacs)
1st year 10% 180
2nd year 20% 189
3rd year 30% 198 90.72
4th year 40% 208 142.88
5th year 50% 219 200.04
262.55
 Packaging Charges
Amoun
Raw Material Packets
Rate per t
(100
Packet (Rs. in
Grams)
lacs)
1st year 240,000 7 16.8
2nd year 480,000 8 38.4
3rd year 720,000 9 64.8
4th year 960,000 9.5 91.2
5th year 1,200,000 10 120

5.7 Sales Revenue

COMPUTATION OF SALE

3rd
Particulars 1st year 2nd year
year
Op Stock - 8,000 8,800
Production 240,000 480,000 720,000
Less : Closing Stock 10,000 8,800 9,600
Net Sale 230,000 471,200 710,400
sale price per Packet 75 79 83
Sales (in Lacs) 173 371 587

COMPUTATION OF WORKING CAPITAL REQUIREMENT

TRADITIONAL METHOD (in Lacs)
Own
Particulars Amount Bank Finance
Margin

Finished Goods & Raw Material 10

Less : Creditors 4
Paid stock 6 3 3
Sundry Debtors 5 3 2
11 6 5

WORKING CAPITAL LIMIT DEMAND ( from Bank) 5.00

5.7 Sales Revenue

COMPUTATION OF SALE
 1st 3rd 4th
Particulars 2nd year 5th year
year year year
Op Stock - 8,000 8,800 9,600 10,400
Production 240,000 480,000 720,000 960,000 1,200,000
Less : Closing Stock 10,000 8,800 9,600 10,400 11,200
Net Sale 230,000 471,200 710,400 949,600 1,188,800
sale price per Packet 75 79 83 87 91
Sales (in Lacs) 173 371 587 824 1084

REPAYMENT SCHEDULE OF TERM LOAN

Interest 11.00%
Closing
Additio Interes
Year Particulars Amount Repaymen Balanc
n Total t
t e
ist Opening
-
Balance 1st 22.50 - - 22.50
2nd month 22.50 0.21 - 22.71
3rd month 22.71 0.21 - 22.91
4th month 22.91 0.21 23.12
5th month 23.12 0.21 23.34
6th month 23.34 0.21 23.55
7th month 23.55 0.22 1.00 22.77
8th month 22.77 0.21 1.00 21.97
9th month 21.97 0.20 1.00 21.18
10th month 21.18 0.19 1.00 20.37
11th month 20.37 0.19 1.00 19.56
12th month 19.56 0.18 1.00 18.74
2.24 6.00
2nd
Opening 18.74 0.17 1 17.91
2nd month 17.91 0.16 1 17.07
3rd month 17.07 0.16 1 16.23
4th month 16.23 0.15 1 15.38
5th month 15.38 0.14 1 14.52
6th month 14.52 0.13 1 13.65
7th month 13.65 0.13 1 12.78
8th month 12.78 0.12 1 11.89
9th month 11.89 0.11 1 11.00
10th month 11.00 0.10 1 10.10
11th month 10.10 0.09 1 9.20
 12th month 9.20 0.08 1 8.28
1.54 12.00
3rd
Opening 8.28 0.08 1 7.36
2nd month 7.36 0.07 1 6.42
3rd month 6.42 0.06 1 5.48
4th month 5.48 0.05 1 4.53
5th month 4.53 0.04 1 3.57
6th month 3.57 0.03 1 2.61
7th month 2.61 0.02 1 1.63
8th month 1.63 0.01 1 0.65
9th month 0.65 0.01 0.65 -
0.37 8.65

FINANCIAL INDICATORS

PARTICULARS 1st year 2nd year 3rd year 4th year 5th year
TURNOVER 173 371 587 824 1084
GROSS PROFIT 90.50 217.29 351.94 502.46 666.96
G.P. RATIO 52.46% 58.56% 59.91% 60.94% 61.54%

NET PROFIT 20.91 86.47 154.99 232.33 316.56

N.P. RATIO 12.12% 23.30% 26.38% 28.18% 29.21%

CURRENT ASSETS 43.32 127.55 223.69 340.98 632.12

CURRENT LIABILITIES 20.00 71.00 123.00 182.00 246.00
CURRENT RATIO 2.17 1.80 1.82 1.87 2.57

TERM LOAN 18.74 8.28 - - -

TOTAL NET WORTH 21.18 60.85 110.24 166.25 391.67
DEBT/EQUITY 0.88 0.14 - - -

6. LICENSE & APPROVALS

• Obtain the GST registration.

• Additionally, obtain the UDYAM registration Number.
• FSSAI License.
• Fire/pollution license as required.
• Factory License
• Choice of a Brand Name of the product and secure the name with
Trademark if required.

Implementation Schedule
S.N. Activity Time Required
(in Months)

1 Acquisition Of premises 1

2 Procurement & installation of Plant & Machinery 1-2

3 Arrangement of Finance 1-2

4 Requirement of required Manpower 1

Total time Required (some activities shall run 4-5 Months

concurrently)

7. ASSUMPTIONS
1. Production Capacity of Namkeen is 800 Kgs per day. First year, Capacity
has been taken @ 50%.

2. Working shift of 8 hours per day has been considered.

3. Raw Material stock is for 10 days and Finished goods Closing Stock has

been taken for 10 days.

4. Credit period to Sundry Debtors has been given for 9 days.

5. Credit period by the Sundry Creditors has been provided for 9 days.

6. Depreciation and Income tax has been taken as per the Income tax Act,

1961.

7. Interest on working Capital Loan and Term loan has been taken at 11%.

8. Salary and wages rates are taken as per the Current Market Scenario.

9. Power Consumption has been taken at 15 KW.

10.Selling Prices & Raw material costing has been increased by 5% & 5%
respectively in the subsequent years.