SMEDA Plaster of Paris Tiles - Boarders Trim and Made-Ups

Pre-Feasibility Study
Plaster of Paris Tiles / boarders, Trim & made-ups
Small and Medium Enterprise Development Authority

Government of Pakistan
www.smeda.org.pk
HEAD OFFICE 6th Floor, LDA Plaza, Egerton Road Lahore Tel: (042) 111-111-456, Fax: (042) 5896619, 5899756 [email protected]
REGIONAL OFFICE PUNJAB 6th floor, LDA Plaza, Egerton road Lahore. Tel: (042) 111-111-456 Fax: (042) 5896619, 5899756 [email protected] REGIONAL OFFICE SINDH 5TH Floor, Bahria Complex II, M.T. Khan Road, Karachi. Tel: (021) 111-111-456 Fax: (021) 5610572 [email protected] REGIONAL OFFICE NWFP Ground Floor State Life Building The Mall, Peshawar. Tel: (091) 9213046-47 Fax: (091) 286908 [email protected] REGIONAL OFFICE BALOCHISTAN Bungalow No. 15-A Chaman Housing Scheme Airport Road, Quetta. Tel: (0812) 831623, 831702 Fax: (0812) 831922 [email protected]
June, 2011
Pre-feasibility Study
Plaster of Paris Tiles, Borders & Made-ups
DISCLAIMER
The purpose and scope of this information memorandum is to introduce the subject matter and provide a general idea and information on the said area. All the material included in this document is based on data/information gathered from various sources and is based on certain assumptions. 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 does not assume any liability for any financial or other loss resulting from this memorandum in consequence of undertaking this activity. Therefore, the content of this memorandum should not be relied upon for making any decision, investment or otherwise. The prospective user of this memorandum is encouraged to carry out his/her own due diligence and gather any information he/she considers necessary for making an informed decision. The content of the information memorandum does not bind SMEDA in any legal or other form.
DOCUMENT CONTROL
Document No. Prepared by Issue Date Issued by SMEDA-Balochistan 06 / 2011 SMEDA Balochistan
2 BAL-PREF- /June, 2011
TABLE OF CONTENTS
1 Introduction to smeda .............................................................................................. 5 PURPOSE OF THE DOCUMENT.................................................................................. 6 2 PROJECT PROFILE ............................................................................................... 6 2.1 Project Brief ....................................................................................................... 6 2.2 HISTORY ............................................................................................................ 6 2.3 Defining Plaster of Paris..................................................................................... 8 2.4 Plaster of Paris as Core Ingredient for its Made ups:.......................................... 9 2.5 Opportunity Rationale....................................................................................... 14 2.6 Proposed Business Legal Status ........................................................................ 15 2.7 Proposed Product ............................................................................................. 15 2.8 Proposed Project Location................................................................................ 15 2.9 Production Capacity ......................................................................................... 15 2.10 Project Investment ............................................................................................ 15 2.11 Recommended Project Parameters.................................................................... 16 2.12 Environmental consideration ............................................................................ 16 2.13 Key Success Factors / Practical Tips for Success .............................................. 16 2.14 Strategic Recommendations .............................................................................. 17 3 CURRENT INDUSTRY STRUCTURE ................................................................ 18 3.1 Current Scenario .............................................................................................. 18 4 MARKET INFORMATION .................................................................................. 18 4.1 Utilization of Plaster of Paris............................................................................ 18 a. Use in Architecture:.............................................................................................. 18 b. Use in Arts:........................................................................................................... 18 4.2 Target Customers.............................................................................................. 19 4.3 Market Potential ............................................................................................... 19 4.4 Market Entry Timing......................................................................................... 20 5 MANUFACTURING PLASTER OF PARIS ITEMS........................................... 20 5.1 Mold Oiling: ..................................................................................................... 20 5.2 Re-hydration (Filling of Mold with Plaster of Paris):........................................ 20 5.3 Shaping & Treatment:....................................................................................... 21 5.4 Setting / Drying: ............................................................................................... 21 5.5 The production process of Plaster of Paris tiles / boarders, trims and made ups: 22 6 Project Inputs ......................................................................................................... 23 6.1 Equipment & Tools ........................................................................................... 23 6.2 Office Equipment .............................................................................................. 23 6.3 Furniture & Fixture .......................................................................................... 23 6.4 Equipment Maintenance.................................................................................... 23 6.5 Human Resource Requirement .......................................................................... 24 6.6 Building Requirement ....................................................................................... 24 6.7 Recommended Mode ......................................................................................... 24 6.8 Utilities and Infrastructure Requirement ........................................................... 24 7 PROJECT ECONOMICS ...................................................................................... 25
7.1 Project Cost ...................................................................................................... 25 7.2 Project Returns ................................................................................................. 25 7.3 Project Financing ............................................................................................. 25 8 FINANCIAL ANALYSIS....................................................................................... 26 8.1 Project Cost ...................................................................................................... 26 8.2 Projected Income Statement .............................................................................. 27 8.3 Projected Balance Sheet.................................................................................... 28 8.4 Projected Cash Flow Statement ........................................................................ 29 9 KEY ASSUMPTIONS ............................................................................................ 30
INTRODUCTION TO SMEDA
The Small and Medium Enterprise Development Authority (SMEDA) was established with the objective to provide fresh impetus to the economy through the launch of an aggressive SME support program.1i Since its inception in October 1998, SMEDA had adopted a sector SME development approach. A few priority sectors were selected on the criterion of SME presence. In depth research was conducted and comprehensive development plans were formulated after identification of impediments and retardants. The all-encompassing sector development strategy involved recommending changes in the regulatory environment by taking into consideration other important aspects including financial aspects, niche marketing, technology up-gradation and human resource development. SMEDA has so far successfully formulated strategies for sectors including, fruits and vegetables, marble and granite, gems and jewelry, marine fisheries, leather and footwear, textiles, surgical instruments, urban transport and dairy. Whereas the task of SME development at a broader scale still requires more coverage and enhanced reach in terms of SMEDAs areas of operation. Along with the sector focus a broad spectrum of business development services is also offered to the SMEs by SMEDA. These services include identification of viable business opportunities for potential SME investors. In order to facilitate these investors, SMEDA provides business guidance through its help desk services as well as development of project specific documents. These documents consist of information required to make wellresearched investment decisions. Pre-feasibility studies and business plan development are some of the services provided to enhance the capacity of individual SMEs to exploit viable business opportunities in a better way. This document is in the continuation of this effort to enable potential investors to make well-informed investment decisions.
For more information on services offered by SMEDA, please visit our website: www.smeda.org.pk
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, and production, finance and business management.
PROJECT PROFILE
The pre-feasibility is related to setting up Plaster of Paris tiles/boarders, Trims, medallions, Frieze & made-ups business highlighting its existing market scenario, the methodology and procedures involved in preparing the saleable products and then assessing the project profiles to give a clear concept of the project dynamics to SMEs for investment. The document highlights the marketing, management, and financial aspects required for the establishment and successful running of the project. 2. 1 Project Brief
The project is related to the usage of Plaster of Paris to produce Tiles/ boarders, Trims, & Miscellaneous made-ups that is being utilized in the construction Industry for making roof designs, Ceiling & corner boarders, trims & medallions, Frieze, & miscellaneous other decorative items used in construction etc. Once the project starts, it could supply Plaster of Paris products of various designs addressing to the customized consumer needs & choices, hence proving its versatility & innovation. This document covers various business aspects of making plaster of Paris Tiles, boarders, Trims, medallions, Frieze & made-ups development, Start-up, Production, Marketing, Finance and Business Management. The total project investment is Rs. 3.68 millions with a Project Internal Rate of Return (IRR) of 40 % against the Capital Cost (WACC) of 18%. The total project investment would be paid back in approximately 2.89 years. 2. 2 HISTORY
In the early period of 1600s century Egyptians discovered the extraction of plaster of Paris from gypsum, while later on the Greeks started the use of this plaster of Paris for their construction purposes basically in their tombs and homes construction. The first scientific study on plaster was realized in 1768 by a French scientist named Lavoisier. In 1887, Le Chatelier, another prominent French scientist, was the first to study the hydration mechanisms of plaster. And then, plaster gradually became a fascinating research subject for scientists. In ancient India and China, renders in clay and gypsum plasters were used to produce a smooth surface over rough stone or mud brick walls. History seems to indicate that, despite the name, plaster of Paris was invented by the Egyptians. It was used as an artistic decoration in many Egyptian tombs, and the Greeks
picked up the technique, using plaster in their own homes, temples, and works of art. Paris became synonymous with this type of plaster in the 1600s, the large deposit of gypsum made it easy to produce plaster of Paris. The substance was also used extensively in fireproofing; giving Parisian homes a distinctive appearance. Plaster decoration was widely used in Europe in the middle Ages where, from the mid-13th century, gypsum was used for internal and external plaster. Hair was employed as reinforcement, with additives to assist setting or plasticity including malt, urine, beer, milk and eggs. In the 14th century, decorative trowelled plaster, called pargeting was used in South-East England to decorate the exterior of timber-framed buildings. This is a form of incised, molded or modeled ornament, executed in lime putty or mixtures of lime and gypsum plaster. During this same period, terracotta was reintroduced into Europe and was widely used for the production of ornament. In the 1700's, Paris was already the "capital of plaster" ("Plaster of Paris") since all the walls of wooden houses were covered with plaster, as a protection against fire. Plaster of Paris usage in Art & Architecture Artists use plaster of Paris to create sculpture, make decorative items and as a painting surface. The Greeks and Romans used plaster to create replicas of their more famous artworks. The Egyptians perfected plaster casting methods and used them to make casts of the heads of the dead in order to recreate their likenesses. The use of finely ground gypsum plaster to create decorative molding was popular during the 18th and 19th centuries. Painting in fresco is the process of painting on a thin layer of wet plaster of Paris. A wellknown example of fresco work is Michelangleo's ceiling in the Sistine Chapel. Plaster of Paris trim, medallions and friezes etc are used to bring a touch of old-world class, modern patterns & customized artwork to transform the plain ceilings/walls into desired designs to add value and sanctity to the building. Ceiling medallions made of plaster and wood were common accents in government buildings and upper class homes centuries ago.
Fig: 1 Percentage of Gypsum usage in various products / services

Commodity
Gypsum Wallboard, Building board and Lath Gypsum building plasters and other material Other calcined gypsum products Industrial plasters Molding, Ornaments and architectural plaster work Gypsum statuary and art goods Others
Percentage
70 10 10 6 2 1 1 100
Gypsum Wallboard, Building board and Lath Gypsum building plasters and other material Other calcined gypsum product Industrial plasters Molding, Ornaments architectural plaster work Gypsum statuary and art goods Others
2. 3
Defining Plaster of Paris
Gypsum has the very useful property of becoming plastic like mass when heated up to 175C. At this temperature it loses about 3/4th of the water molecules. The product thus obtained is known as Plaster of Paris. It can be mixed with water, spread and cast into different forms and sizes. It can be mixed with expanded perlite and vermiculite and made into wall plaster and castings. There are three qualities of Plaster of Paris used for making various items & for decorating purposes especially in construction industry are given as under;
Table 1: Qualities of Plaster of Paris
Type 1.A-fast setting 2.B-regular setting 3.C-slow setting
Start of setting in 2 min 6min 20min
Setting time 15 min 30min 90min

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Volume change +1% +1% +2%
BAL-PREF- /June, 2011
Three grades of Plaster of Paris are generally known and manufactured: 2. 4 Surgical Technical Commercial Plaster of Paris as Core Ingredient for its Made ups:
Plaster of Paris is core raw material used for the making of Plaster of Paris Tile, Boarders, Trims, Medallions and Misc Made ups. It is a sculpting material with a variety of decorative and practical applications. Plaster of Paris is inexpensive and simple to work with. It can be used to decorate a finished product with paint or embellish it with beads, stones and wire. Common uses for plaster of Paris include making castings for other artistic mediums, creating sculptures and making home dcor objects.2 The Plaster of Paris is used in the following fields, Castings Architecture & Art Fireproof
Castings One common use for plaster of Paris is to make decorative castings to be used as embellishments, jewelry charms and pendants. Select a flexible plastic mold from a craft store and apply a generous coating of a release agent to the mold before pouring the mixed plaster of Paris into it. Release agents can be common household supplies, such as petroleum jelly or nonstick cooking spray. Without a release agent, the plaster of Paris will be difficult to remove from the mold and will often break. Allow the plaster to set up in the mold for one hour, and then remove it. The molded plaster is still soft enough at this point to trim away any excess material from around the edges. Allow the cast piece to dry for at least 24 hours before decorating it. Art & Architecture: Plaster of Paris is used by artists for producing sculptures and decorative items and as a painting surface since ages. Today Plaster of Paris is being widely used in making abstract arts, canvas, sculptured paintings, wall paintings, decorative ceilings etc. The Greeks and Romans used plaster to create replicas of their more famous artworks. The Egyptians perfected plaster casting methods and used them to make casts of the heads of
2
http://www.ehow.com/list_6149563_common-uses-plaster-paris.html
the dead in order to recreate their likenesses. The use of finely ground gypsum plaster to create decorative molding was popular during the 18th and 19th centuries. Painting in fresco is the process of painting on a thin layer of wet plaster of Paris. A well-known example of fresco work is Michelangelos ceiling in the Sistine Chapel. Plaster trim, medallions and friezes bring a touch of old-world class to your plain ceiling. Plaster of Paris usually dries hard but is relatively lightweight. Plaster of Paris is also known as gypsum plaster. It is mainly used in architectures in historical monuments from the 16th century onwards. It is specially meant for decorative purposes. The modern plaster of Paris is used in the repair works of historic monuments. It is a wood substitute in the ancient world; for example, when wood became scarce due to deforestation on Bronze Age Crete, Plaster of Paris was employed in building construction at locations where wood was previously used. Due to its hardness & its unique characteristics of taking the shape of every mold type, it is widely used for home brewing and also as a filling agent in building cracks, holes, destroyed designed parts, etc. Raised plaster stenciling added architectural elegance to stately homes and government buildings at the turn of the century. Artisans created beautiful plaster designs on the walls and ceilings of the White House in 1905. Raised plaster stenciling or relief stenciling is an elegant way to perk up any space. The designs can delicately accent wall and ceiling trims or add style to outdoor urns and furniture.
Fireproof: Plaster of Paris was use as fireproofing agent for protections from early decades. Plaster produces water vapor when it is exposed to fire thus slow down the spreading of fire3. It also acts as an insulator material to heat. Plasters have been in use in passive fire protection, as fireproofing products, for many decades. The finished plaster releases water vapor when exposed to flame, acting to slow the spread of the fire, for as much as an hour or two depending on thickness. It also provides some insulation to retard heat flow into structural steel elements that would otherwise lose their strength and collapse in a fire. Modern plasters fall into the following categories: Fibrous (including mineral wood and glass fiber) Cement mixtures either with mineral wool or with vermiculite
Gypsum plasters, leavened with polystyrene beads, as well as chemical expansion agents to decrease the density of the finished product. The majority of plasters in current use within construction are based on retarded hemihydrate gypsum. The addition of different quantities of a retarding agent, usually keratin, is used to adjust the setting time for different products.
3
http://www.tutorvista.com/chemistry/uses-of-plaster-of-paris
International usage of Moulds and Plaster of paris products:4

There are a variety of common molds for making Plaster of paris pieces:5
Baguette 6 Thin, half-round molding, smaller than an astragal, sometimes carved, and enriched with foliages, pearls, ribbands, laurels, etc. When enriched with ornaments, it was also called chapelet. Bandelet Any little band or flat molding, which crowns a Doric architrave. It is also called a tenia. Baseboard, "base molding" or "skirting board" used to conceal the junction of an interior wall and floor, to protect the wall from impacts and to add decorative features. A "speed base" makes use of a base "cap molding" set on top of a plain 1" thick board, however there are hundreds of baseboard profiles. Batten or board and batten a symmetrical molding that is placed across a joint where two parallel panels or boards meet. Bead molding narrow, half-round convex molding, when repeated forms reeding Beading or bead molding in the form of a row of half spherical beads, larger than pearling
o
Other forms: Bead and leaf, bead and reel, bead and spindle
Beak Small fillet molding left on the edge of a larmier, which forms a canal, and makes a kind of pendant. Bed molding a narrow molding used at the junction of a wall and ceiling. Bed moldings can be either sprung or plain. Bolection a moulding which is raised, projecting proud of the face frame. It is located at the intersection of the different surface levels between the frame and inset panel on a door or wood panel. It will sometimes have a rebate (or rabbet) at the back, the depth of the difference in levels, so that it can lay over the front of both the face frame and the inset panel and can in some instances thus give more space to nail the moulding to the frame, leaving the inset panel free to expand or contract in varying climates, as timber is prone to do. Cable molding or ropework Convex molding carved in imitation of a twisted rope or cord, and used for decorative moldings of the Romanesque style in England,
http://www.gcmpinc.com/commonmolds.htm
http://www.maragon.co.uk/arts-andcrafts.html?hl=en&source=hp&q=plaster+of+paris++%26+uk&meta=&aq=f&aqi=&aql=&oq=&gs_rfai=#Init http://www.aehf.com/articles/moldlist.htm
France and Spain and adapted for 18th century silver and furniture design (Thomas Sheraton)

Cabled fluting or cable Convex circular molding sunk in the concave fluting of a classic column, and rising about one-third of the height of the shaft Casing Final trim or finished frame around the top, and both sides of a door or window opening. Cartouche (French) escutcheon) framed panel in the form of a scroll with an inscribed center, or surrounded by compound moldings decorated with floral motifs. Cavetto (Italian) cavare: "to hollow", concave, quarter-round molding sometimes employed in the place of the cymatium of a cornice, as in the Doric order of the theatre of Marcellus. It forms the crowning feature of the Egyptian temples, and took the place of the cymatium in many of the Etruscan temples. Chair rail horizontal molding placed part way up a wall to protect the surface from chair-backs, and used simply as decoration. Chamfer beveled edge connecting two surfaces. Chin-beak Concave quarter-round molding. There are few examples of this in ancient buildings, but is common in more recent times. Corner guard Used to protect the edge of the wall at an outside corner, or to cover a joint on an inside corner. Cove molding or Coving a concave-profile molding that is used at the junction of an interior wall and ceiling Crown molding a wide, sprung molding that is used at the junction of an interior wall and ceiling. General term for any molding at the top or "crowning" an architectural element. Cyma molding of double curvature, combining the convex ovolo and concave cavetto. When the concave part is uppermost, it is called a cyma recta but if the convex portion is at the top, it is called a cyma reversa, When the crowning molding at the entablature is of the cyma form, it is called a cymatium. Dentils Small blocks spaced evenly along the bottom edge of the cornice Drip cap this is placed over a door or window opening to prevent water from flowing under the siding or across the glass Echinus Similar to the ovolo molding and found beneath the abacus of the Doric capital or decorated with the egg-and-dart pattern below the Ionic capital Egg-and-dart One of the most widely used classical moldings with egg shapes alternating with V-shapes and known from Ancient Greek temples (Erechtheion).
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Also: Egg and tongue, egg and anchor, egg and star
Fillet small, flat band separating two surfaces, or between the flutes of a column Fluting Vertical, half-round grooves cut into the surface of a column in regular intervals, each separated by a flat astragal. This ornament was used for all but the Tuscan order Godroon or Gadroon Ornamental band with the appearance of beading or reeding, especially frequent in silverwork and molding. It comes from the Latin word Guttus, meaning flask. It is said to be derived from raised work on linen, applied in France to varieties of the, bead and reel, in which the bead is often carved with ornament. In England the term is constantly used by auctioneers to describe the raised convex decorations under the bowl of stone or terracotta vases. The godroons radiate from the vertical support of the vase and rise half-way up the bowl.
o
Also: Gadrooning, lobed decoration, (k)nukked decoration, thumb molding
Guilloche Interlocking curved bands in a repeating pattern often forming circles enriched with rosettes and found in Assyrian ornament, classical and Renaissance architecure. Keel molding with a sharp edge, resembling in cross-section the keel of a ship. It is common in the Early English and Decorated styles. Ovolo Simple, convex quarter-round molding that can also be enriched with the egg-and-dart or other pattern. Picture Rail - Functional molding installed 79 feet above the floor from which framed pictures and paintings are hung using picture wire and picture rail hooks. Rosette Circular, floral decorative element found in Mesopotamian design and early Greek stele. Part of revival styles in architecture since the Renaissance. Scotia Concave molding with a lower edge projecting beyond the top and so used at the base of columns as a transition between two torus moldings with different diameters. Screen molding this is a small molding that is used to hide the area where a screen is attached to the frame. Shoe molding, toe molding or quarter-round often used at the bottom of the baseboard to cover a small gap or uneven edge between the flooring and the baseboard. Torus Convex, semi-circular molding, larger than an astragal, often at the base of a column, which may be enriched with leaves or plaiting
Trim Molding A general term used for moldings that are used to create added detail or cover up gaps. They can include corner moldings, cove moldings, rope moldings, quarter rounds, and accent moldings. Crown Pieces Crown pieces are most often used to decoratively finish off a room where the wall meets the ceiling. They are also used commonly at the top of kitchen cabinets. Rop Pieces Rop pieces can also be used to create their own trimwork details, and are also a great way to add more dimension to crown pieces.
2. 5
Opportunity Rationale
The construction industry plays an essential role in the socio economic development of a country. The activities of the industry have great significance to the achievement of national socio-economic development goals of providing infrastructure, sanctuary and employment. Housing construction is one of the largest sectors of most major economies in the world. The construction and sale of new homes make direct contribution to GDP, based on the value of the housing built. Currently7, Pakistan has a serious housing crisis and needs about 7 million additional housing units now, according to the data presented at the World Bank Regional Conference on Housing. According to BMI research, the countrys real estate sector continues to be dominated by the two major issues of a chronic shortage of housing against a backdrop of rapid urbanization and rising population, this creates a massive gap in the availability of houses and thus the demand for new housing is escalating. The first of these factors remains as intractable as ever, with the most recent estimates identifying shortfall of 7.9mn houses. By some accounts, nationally there is an incremental demand for 700,000 units a year against the annual construction of just 150,000 units. Construction is one of the most labor intensive economic activity requiring large numbers of workers, creating hundreds of thousands of jobs. And when the buyers move in, they will demand all kinds of products and services to furnish their homes, thereby creating further employment opportunities. All of this is offers a great recipe for reigniting economic growth and renewed prosperity in Pakistan. Pakistan, with a population of more than 170 million people, has no formal gypsum plaster industry for construction purposes. According to the available literature, gypsum plaster and its products are energy saving, fire resistant, good insulating, cost effective and possess an excellent thermal, acoustical and aesthetic properties. Trends for the usage of Plaster of Paris tiles/boarders, Trims, medallions, Frieze & made-ups have increased in Construction
http://southasiainvestor.blogspot.com/2009/12/pakistans-housing-and-economic-growth.html
industry especially for decorative purposes. Gypsum plaster is widely used in the construction industry for construction purposes. Due to the rising housing demand in the country and over all boom in the construction industry the potential for the growth of Plaster of Paris Tile, boarders, trims, medallions & made ups business cannot be undermined.
2. 6
Proposed Business Legal Status
The business can be started as sole proprietorship or partnership because of great potential involved. Furthermore, comparatively fewer complications are involved in forming, administering and running the sole proprietorship or partnership businesses. 2. 7 Proposed Product
The manufacturer will make/produce different types of decorative items such as tiles, boarders, trims, decorative cornices, ceiling roses / designs, false ceilings, columns, fire places and other made ups as per requirement of the customers. 2. 8 Proposed Project Location
The said project can be started in an Industrial Area. It is recommended to establish the project in an area where Raw Material is easily available. It may be in any Industrial Area of Lahore, Gujranwala, Karachi, Quetta or Islamabad. The proposed location of this Prefeasibility is recommended to be Quetta since Quetta offers a somewhat diversified economy with an active construction sector. The abundant availability of raw material considerably increases the scope for establishment of the proposed project in the said region. Furthermore Quetta having dry weather almost round the year which is an added advantage because plaster of Paris deteriorates in very moist conditions. From an international perspective the city has an edge to export to neighboring countries like Afghanistan and Baltic states. 2. 9 Production Capacity
The unit would have the capacity to process around 120,000 pieces of Plaster of Paris tiles, boarders, trims & made-ups, however it is assumed that in first year of its operation the plant will produce around 84,000 pieces of Plaster of Paris tiles, boarders, trims & madeups at the rate of 70% capacity utilization. This production is based on single shift bases. 2. 10 Project Investment
The total project investment is Rs. 3.68 millions which includes Capital Cost of Rs. 2.42 million and working capital of Rs. 1.3 million. It is assumed that the project would be fully equity financed (100%).
2. 11 Capacity
Recommended Project Parameters Human Resource 10 Equipments/Tools Local Made Cost Of Capital (WACC) 18%
Table: 02: Project financial parameters
120,000 pieces / year Financial Summary Total Cost Rs. 3.68M IRR 40%
NPV 5.20 M
Pay Back Period 2.89 Years
2. 12
Environmental consideration
Working with Plaster is fairly safe if safety rules are observed when mixing plaster. Once hardened there is little or no hazard from handling plaster items; Plaster is very alkaline and exposure to high dust levels may irritate the skin, eyes, nose, throat, or upper respiratory tract. Wearing a dust mask, eye protection, and rubber gloves when mixing plaster reduces the risk. Contact lenses should be avoided when working with plaster. Plaster generates a lot of heat when setting plaster should not be used for making casts of body parts. Plaster should be kept away from children and pets.
Air and water quality, noise pollution, disposal of waste and health care of the labors should be of minimum standard fall within the required principles and specifications. 2. 13 Key Success Factors / Practical Tips for Success
Easy set up of the business or unit. Availability of raw material in the local market. Availability of low price land / Rental premises for the establishment of the unit. Availability of locally made equipment, molds and spares. Increasing local trends towards use of Plaster of Paris items and its made-ups for decorative and construction purposes. Rehabilitation in Afghanistan. Availability of efficient labor. Easy transfer of the skills to the unskilled labors.
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Ample opportunity for exports. 2. 14 Strategic Recommendations
Emphasizing on excellent services to its customers such as standardized products and timely order fulfillment. Focusing on strong marketing efforts for its products. Providing excellent after sales services to its customers. Providing latest designs of plaster of Paris items & if possible providing customized designs as per customer requirements. New equipments & latest design Molds (more No. of Molds) should be purchased in order to increase the Efficiency and Production. Adapting the rapid, social, economic and technological changes in order to avoid wastage of its raw material. Hiring of well-trained, specialized and experienced staff will add in the efficiency of the facility. Conducting periodical labors skills development programs through trainings. Introducing team working concept in the business unit. Establishing sufficient monitoring and evaluation principles for the overall business activities of the unit. Using Fine quality Plaster of Paris Powder and other required items (certified through well reputed Laboratory) to get superior quality end product. Maintaining proper booking & Accounts of the business financials.
CURRENT INDUSTRY STRUCTURE

3. 1 Current Scenario
Plaster of Paris Tiles/ boarders, Trims, & Miscellaneous made-ups industry is pretty much aligned with the hype in the construction industry since the last decade. There are approximately twenty (20) small scale Plaster of Paris products manufacturing units in Quetta which are fully functional. Constructions of new housing schemes, public buildings and commercial shopping malls in the city have greatly increased the demand of Plaster of Paris decorative items. Therefore, it is very feasible to invest in the project since demand of the products is increasing as the construction industry in Balochistan is also growing. Furthermore, due to its uniqueness in deign/ patterns and low cost, trends of decorating homes with Plaster of Paris tiles, boarders, medallions etc have escalated throughout the province.
MARKET INFORMATION
4. 1 a. Utilization of Plaster of Paris Use in Architecture:
Plaster of Paris made ups may also be used to create complex detailing for use in room interiors. These may be geometric (simulating wood or stone) or naturalistic (simulating leaves, vines, and flowers). These are also often used to simulate wood or stone detailing found in more substantial buildings.
b.
Use in Arts:
Many of the greatest paintings in Europe, like Michelangelo's Sistine Chapel ceiling are executed in Fresco meaning they are painted on a thin layer of wet plaster, called intonaco (in fact the general term for plaster in Italian); the pigments sink into this layer so that the plaster itself becomes the medium holding them, which accounts for the excellent durability of fresco. Additional work may be added a secco on top of the dry plaster, though this is generally less durable.
Plaster may be casted directly into a damp clay mold. Creating this moldmolds (molds designed for making multiple copies) or waste molds (for single use) can also be made of plaster. This "negative" image, if properly designed, may be used to produce clay productions, which when fired in a kiln become terra cotta building decorations, or these may be used to create cast concrete sculptures. If a plaster positive was desired this would be constructed or cast to form a durable image artwork, which would be sufficient for stonecutters. If intended for producing a bronze casting the plaster positive could be further worked to produce smooth surfaces. An advantage of this plaster image is that it is relatively cheap; should a patron approve of the durable image and be willing to bear further expense, subsequent molds could be made for the creation of a wax image to be used in lost wax casting, a far more expensive process. In lieu of producing a bronze image suitable for outdoor use the plaster image may be painted to resemble a metal image; such sculptures are suitable only for presentation in a weather-protected environment. Plaster of Paris expands while hardening, and then contracts slightly just before hardening completely. This makes plaster excellent for use in molds, and it is often used as an artistic material for casting. Plaster is also commonly spread over an armature (form), usually made of wire, mesh or other materials Plaster of Paris made ups are often used in faux finishing to create textures for wall and furniture surfaces, as in Venetian Plaster and also in stenciling for raised details. For these processes, artists use limestone based plasters or new user friendly acrylic based plaster.
4. 2
Target Customers
The target customers for Plaster of Paris tiles, trims, boarders, frieze, medallions and made ups include individuals, home furnishers, construction companies / contractors, architecture firms etc. Use of Plaster of Paris tiles & made ups makes a strong case for its manufacturing. In addition to Balochistans own requirements, the items can also be exported to Afghanistan that is under rehabilitation & with an unprecedented construction boom. 4. 3 Market Potential
Demand for Plaster of Paris products is growing in Quetta due massive urban construction in the city. The increase in demand of Plaster of Paris products can be best tapped for economic benefits due to its affordable price, easy availability, cheap raw material, labor
availability, etc. since it is comparatively cheaper in cost then wood work, stone crafts and cement based designs etc. The demand for Plaster of Paris products are continuously growing with the growth of construction industry. It is, therefore, imperative that a coordinated effort be made to improve quality & productivity of these products with innovative designs & idea in the country to serve the construction industry needs with the subsequent result of achieving job creation and economic growth. 4. 4 Market Entry Timing
Construction process is not affected by weather however, in winter the below freezing temperatures often slows it down. However, in few areas of the province the extreme cold weather slows down or sometimes even halts construction. However, the production process can be a round the year process. It is proposed that the project should be started in spring so that it can achieve the required capacity in year one.
MANUFACTURING PLASTER OF PARIS ITEMS
The Process Flow: Plaster of Paris is used as an important raw material for making Tiles/ boarders, Trims, medallions, frieze, miscellaneous made-ups and decorative items etc. The whole process of making Plaster of Paris decorative items is described below: 5. 1 Mold Oiling:
The process begins by initially applying an oil mixture on to the surface of the mould before pouring the liquid paste of the plaster of Paris. This oil mixture is used as a separating medium in order to easily extract the set Plaster of Paris shape (tiles, boarders, medallions, frieze etc) from the Mould. The oil mixture is prepared with the help of different ingredients, such as diesel, cooking oil, cutting oil, Mobile oil, water and Soap. 5. 2 Re-hydration (Filling of Mold with Plaster of Paris):
To make the paste of the plaster of Paris, water is added with plaster of Paris powder & mixed homogeneously with hands till a slurry paste is achieved, which is then ready to be poured in the plastic/fiber mold. When it solidifies it takes the shape of the mold & form tiles, ceiling boarders, medallions, frieze etc. The ratio of plaster of Paris powder & water is determined manually until a thick slurry paste is formed. The Plaster of Paris paste must be utilized immediately since it will set with in few minutes and once it starts setting it cannot be utilized and will be wasted.
In this stage of production mold are partially filled with Plaster of Paris paste and spread on the mould so that every part of the mold receives equal proportion. Here the paste in the mould is leveled properly & some times the mold is tapped on the table/floor so that the paste reaches deep into every minute detailing of the design. After leveling the surface, used Poly propylene plastic bags in which the powder plaster of Paris is supplied (or new ones purchased) are shredded in to strips and are spread & slightly dipped with hands on the partially poured plaster of Paris paste for the purpose of obtaining strength of the resultant piece of tiles, medallions, boarders, etc. Some manufacturers also use Coconut shell torn in to thread instead of Poly propylene (PP) bags which gives more strength then plastic. Since the coconut shells are expensive therefore, most of the manufacturers use the PP Bags.
5. 3
Shaping & Treatment:
After the plastic or coconut shell strips are dipped in the paste another layer of Plaster of Paris is poured to fill the mold & leveled by hand or a wood piece and surface is finalized. Here in this stage we fix hooks (made from iron wires) in all corners of the tiles. These hooks will aid in the installation or fixing of these tiles, boarders etc. on building ceilings. 5. 4 Setting / Drying:
In this final stage the mold is left for setting for 5-20 minutes since plaster of Paris takes about 20 minutes to solidify. The set plaster of Paris is now extracted from the mould and placed in direct sunlight so that it gets complete dried. It may take 10-12 hours to completely dry out, consequent to the products desiccation it is ready for sale, transportation, usage or installation.
5. 5
The production process of Plaster of Paris tiles / boarders, trims and made ups:
Flow Chart:
Mold Oiling
Re-Hydration
(Filling of Mold with Plaster of Paris)
Shaping & Treatment
Setting / Drying
PROJECT INPUTS
Following are the basic requirements for Plaster of Paris products making. 6. 1
Table 6-1
Equipment & Tools Equipment & Tools Requirement Origin local local local local local local local Qty 50 10 10 10 10 1 1 Price/Unit 3000 150 3000 400 120 10,000 15,000 Total Price 150,000 1,500 30,000 4,000 1,200 10,000 15,000 214,700
Description Moulds Buckets Iron Stands / tables Bowls Oil Brushes Misc. Tools Water Tank (Plastic) Total 6. 2
Table 6-2
Office Equipment Cost/Unit 25,000 15,000 1,000 2,000 Total Amount (PKR) 25,000 20,000 2,000 2,000 49,000
Office Equipment Description Qty Computer 1 Computer printer 1 Office Stationary 1 Telephone with connection 1 Total 6. 3
Table 6-3
Furniture & Fixture Total Amount (PKR) 25,000 25,000 50,000
Furniture and Fixtures Description Furniture Office Electric Wiring and Lighting Total 6. 4 Equipment Maintenance
All the Equipments / utensils / parts are available in Karachi, Lahore, Faisalabad, Gujranwala, Quetta and Peshawar.
6. 5
Human Resource Requirement
The total human resource required for this project with their proposed / estimated monthly salaries is shown in the below table 8-1;
Table 7-1
Human Resource Requirement Details Number 1 5 1 2 1 10 Building Requirement Salary / Month 15,000 10,000 7000 7000 8000 Total Monthly Salary (Rs.) 15,000 50,000 7000 14,000 8000 94,000
Positions Supervisor Labor Peon Guards Driver Total 6. 6
Building is proposed to be constructed for the project as per descriptions given in the table below:
Table 8-1
Civil Work Cost Area in Sq.ft 168 Cost/Sq.ft 1000 Amount 168,000
Description Office (10x12), Control Room with bath room (6x4) Manufacturing Sheds (50x20) Boundary Wall Total 6. 7
1000 220
600 550
600,000 121,000 889,000
Recommended Mode
It is recommended that the Plaster of Paris tiles, boarders and made ups business should be established in an area which is easily approachable to buyers. For differential marketing onsite supply of readymade products and onsite designing, manufacturing & its installation may be provided to the under construction buildings / houses. Latest computerized designs / patterns customized to customers needs, will boost the business. 6. 8 Utilities and Infrastructure Requirement
Availability of all utilities is a requirement for the Plaster of Paris products business to operate.
PROJECT ECONOMICS
7. 1 Project Cost Amount in (Rs.) 780,000 889,000 214,700 50,000 49,000 80,000 2,416,200 25,667 712,250 28,410 500,000 1,266,327 3,682,527
Description Land Building/Infrastructure Equipment & tools Furniture & fixtures Office equipment Pre-operating costs Total Capital Costs Equipment spare part inventory Raw Material inventory Upfront Insurance Payment Cash Total Working Capital Total Investment 7. 2 Project Returns
Description IRR MIRR Payback Period (yrs) Net Present Value (NPV) 7. 3 Project Financing
Equity 40% 23% 2.89 5.18 million
Project 40% 23% 2.89 5.18 million
Description Debt Financing Equity Financing Total
Percentage 0% 100%
Amount in Rs 3,682,527 3,682,527
FINANCIAL ANALYSIS
8. 1 Project Cost
SMEDA Financial Evaluation of Pre-feasibility Plaster of Paris Tiles, Boarders, Trims & Made-ups
Key Variables Type of Machinery Total Investment in Project Equity Debt Interest Rate Debt Tenure Total Number of Employees
100% 0%
Local 3,682,527 3,682,527 18% 5 10 Rs. in actuals Year 10 5,329,492 8,723,365 14% 10%
Free Cash Flow to Equity (FCFE) Free Cash Flow to Firm (FCFF) Profit margin on sales ROE
Year 1 297,021 297,021 13% 24%
Year 2 1,673,877 1,673,877 15% 27%
Year 3 1,919,209 1,919,209 15% 24%
Year 4 2,096,030 2,096,030 15% 20%
Year 5 1,801,857 1,801,857 16% 18%
Year 6 2,228,203 2,228,203 15% 15%
Year 7 2,286,543 2,286,543 15% 13%
Year 8 2,338,096 2,338,096 14% 12%
Year 9 2,381,632 2,381,632 14% 11%
Equity Internal Rate of Return (IRR) 40% Modified Internal Rate of Return (MIRR)* 23% Payback Period (yrs) 2.89 Net Present Value (NPV) @ 18% 5,177,047 *Re-investment rate has been taken to be the interest on cash in bank, which in this case is 4%
@ 18%
Project 40% 23% 2.89 5,177,047
Statement Summaries
Initial Investment
Capital Investment Land Building/Infrastructure Equipment & Tools Furniture & fixtures Office equipment Pre-operating costs Total Capital Costs Working Capital Equipment spare part inventory Raw material inventory Upfront insurance payment Cash Total Working Capital Total Investment Initial Financing Debt Equity * Provisioning for the first year installments Rs. in actuals 780,000 889,000 214,700 50,000 49,000 80,000 2,416,200 Rs. in actuals 25,667 712,250 28,410 500,000 1,266,327 3,682,527 Rs. in actuals 3,682,527
SMEDA
26 BAL-PREF- /March, 2011
8. 2
Projected Income Statement

SMEDA
Year 1 Year 2 11,970,000 8,463,835 3,506,165 Year 3 13,428,450 9,543,587 3,884,863 Year 4 14,169,330 10,166,036 4,003,294 Year 5 14,877,797 10,775,998 4,101,798 Year 6 15,621,686 11,422,558 4,199,128 Year 7 16,402,771 12,107,912 4,294,859 Year 8 17,222,909 12,834,386 4,388,523 Year 9 18,084,055 13,604,450 4,479,605 Rs. in actuals Year 10 18,988,257 14,420,717 4,567,541
Statement Summaries
Income Statement
Revenue Cost of goods sold Gross Profit General administration & selling expenses Administration expense Utilities expense Travelling & Comm. expense (phone, fax, etc.) Office expenses (stationary, etc.) Promotional expense Insurance expense Professional fees (legal, audit, etc.) Depreciation expense Amortization expense Subtotal Operating Income Other income Earnings Before Interest & Taxes Interest expense Earnings Before Tax Tax NET PROFIT/(LOSS) AFTER TAX Balance brought forward Total profit available for appropriation Balance carried forward
9,240,000 6,540,600 2,699,400
528,000 15,600 158,400 63,360 64,680 28,410 64,680 146,520 16,000 1,197,125 1,502,275 25,940 1,528,215 1,528,215 336,207 1,192,008
559,680 16,536 167,904 67,162 83,790 23,802 83,790 146,520 16,000 1,288,786 2,217,379 65,358 2,282,738 2,282,738 502,202 1,780,535 1,192,008 2,972,544 2,972,544
593,261 17,528 177,978 71,191 93,999 19,193 93,999 146,520 16,000 1,362,539 2,522,324 137,220 2,659,544 2,659,544 585,100 2,074,444 2,972,544 5,046,988 5,046,988
628,856 18,580 188,657 75,463 99,185 14,585 99,185 146,520 16,000 1,427,710 2,575,583 217,525 2,793,108 2,793,108 614,484 2,178,624 5,046,988 7,225,612 7,225,612
666,588 19,695 199,976 79,991 104,145 9,976 104,145 146,520 16,000 1,495,800 2,605,998 295,483 3,042,880 3,042,880 669,434 2,373,447 7,225,612 9,599,059 9,599,059
706,583 20,876 211,975 84,790 109,352 29,021 109,352 170,433 1,599,701 2,599,427 376,084 2,975,511 2,975,511 654,612 2,320,898 9,599,059 11,919,957 11,919,957
748,978 22,129 224,693 89,877 114,819 23,217 114,819 170,433 1,675,334 2,619,525 466,379 3,085,903 3,085,903 678,899 2,407,005 11,919,957 14,326,962 14,326,962
793,917 23,457 238,175 95,270 120,560 17,412 120,560 170,433 1,755,725 2,632,798 558,872 3,191,670 3,191,670 702,167 2,489,502 14,326,962 16,816,464 16,816,464
841,552 24,864 252,466 100,986 126,588 11,608 126,588 170,433 1,841,152 2,638,453 653,266 3,291,720 3,291,720 724,178 2,567,541 16,816,464 19,384,005 19,384,005
892,045 26,356 267,613 107,045 132,918 5,804 132,918 170,433 1,931,910 2,635,631 807,489 3,443,119 3,443,119 757,486 2,685,633 19,384,005 22,069,638 22,069,638
1,192,008 1,192,008
8. 3
Projected Balance Sheet

SMEDA
Year 0 Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Rs. in actuals Year 10
Statement Summaries
Balance Sheet
Assets Current assets Cash & Bank Accounts receivable Finished goods inventory Equipment spare part inventory Raw material inventory Pre-paid insurance Total Current Assets Fixed assets Land Building/Infrastructure Machinery & equipment Furniture & fixtures Office equipment Total Fixed Assets Intangible assets Pre-operation costs Total Intangible Assets TOTAL ASSETS Liabilities & Shareholders' Equity Current liabilities Accounts payable Total Current Liabilities Other liabilities Deferred tax Long term debt Total Long Term Liabilities Shareholders' equity Paid-up capital Retained earnings Total Equity TOTAL CAPITAL AND LIABILITIES
500,000 25,667 712,250 28,410 1,266,327
797,021 759,452 594,600 35,245 987,364 23,802 3,197,483
2,470,898 871,644 712,744 41,912 1,185,308 19,193 5,301,699
4,390,107 1,043,772 799,217 46,877 1,338,373 14,585 7,632,931
6,486,138 1,134,155 847,170 52,175 1,503,796 9,976 10,033,409
8,287,994 1,193,718 898,000 58,070 1,689,665 29,021 12,156,467
10,516,197 1,253,403 951,880 64,632 1,898,507 23,217 14,707,836
12,802,740 1,316,074 1,008,993 71,936 2,133,163 17,412 17,350,317
15,140,836 1,381,877 1,069,532 80,065 2,396,822 11,608 20,080,740
17,522,468 1,450,971 1,133,704 89,112 2,693,069 5,804 22,895,129
22,851,960 1,523,520 1,201,726 25,577,206
780,000 889,000 214,700 50,000 49,000 2,336,200
780,000 844,550 193,230 45,000 44,100 2,189,680
780,000 800,100 171,760 40,000 39,200 2,043,160
780,000 755,650 150,290 35,000 34,300 1,896,640
780,000 711,200 128,820 30,000 29,400 1,750,120
780,000 666,750 107,350 25,000 24,500 2,076,663
780,000 622,300 85,880 20,000 19,600 1,906,230
780,000 577,850 64,410 15,000 14,700 1,735,798
780,000 533,400 42,940 10,000 9,800 1,565,365
780,000 488,950 21,470 5,000 4,900 1,394,933
780,000 444,500 1,224,500
80,000 80,000 3,682,527
64,000 64,000 5,451,163
48,000 48,000 7,392,859
32,000 32,000 9,561,571
16,000 16,000 11,799,529
14,233,130
16,614,066
19,086,115
21,646,105
24,290,061
26,801,706
553,012 553,012
714,172 714,172
808,440 808,440
867,773 867,773
927,928 927,928
992,689 992,689
1,062,456 1,062,456
1,137,668 1,137,668
1,218,806 1,218,806
1,049,541 1,049,541
23,617 23,617
23,617 23,617
23,617 23,617
23,617 23,617
23,617 23,617
18,894 18,894
14,170 14,170
9,447 9,447
4,723 4,723
3,682,527 3,682,527 3,682,527
3,682,527 1,192,008 4,874,535 5,451,163
3,682,527 2,972,544 6,655,070 7,392,859
3,682,527 5,046,988 8,729,514 9,561,571
3,682,527 7,225,612 10,908,139 11,799,529
3,682,527 9,599,059 13,281,585 14,233,130
3,682,527 11,919,957 15,602,484 16,614,066
3,682,527 14,326,962 18,009,489 19,086,115
3,682,527 16,816,464 20,498,991 21,646,105
3,682,527 19,384,005 23,066,532 24,290,061
3,682,527 22,069,638 25,752,165 26,801,706
(0)
8. 4
Projected Cash Flow Statement

(0)
Statement Summaries
Cash Flow Statement
Year 0 Operating activities Net profit Add: depreciation expense amortization expense Deferred income tax Accounts receivable Finished good inventory Equipment inventory Raw material inventory Advance insurance premium Accounts payable Cash provided by operations Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9
SMEDA
Rs. in actuals Year 10
(25,667) (712,250) (28,410) (766,327)
1,192,008 146,520 16,000 23,617 (759,452) (594,600) (9,578) (275,114) 4,609 553,012 297,021
1,780,535 146,520 16,000 (112,192) (118,144) (6,667) (197,945) 4,609 161,160 1,673,877
2,074,444 146,520 16,000 (172,128) (86,473) (4,966) (153,065) 4,609 94,268 1,919,209
2,178,624 146,520 16,000 (90,383) (47,953) (5,297) (165,423) 4,609 59,334 2,096,030
2,373,447 146,520 16,000 (59,562) (50,830) (5,896) (185,869) (19,045) 60,155 2,274,919
2,320,898 170,433 (4,723) (59,686) (53,880) (6,562) (208,843) 5,804 64,761 2,228,203
2,407,005 170,433 (4,723) (62,670) (57,113) (7,303) (234,656) 5,804 69,767 2,286,543
2,489,502 170,433 (4,723) (65,804) (60,540) (8,129) (263,659) 5,804 75,212 2,338,096
2,567,541 170,433 (4,723) (69,094) (64,172) (9,047) (296,247) 5,804 81,138 2,381,632
2,685,633 170,433 (4,723) (72,549) (68,022) 89,112 2,693,069 5,804 (169,264) 5,329,492
Financing activities Change in long term debt Issuance of shares 3,682,527 Cash provided by / (used for) financing activities3,682,527 Investing activities Capital expenditure (2,416,200) Cash (used for) / provided by investing activities(2,416,200) NET CASH Cash balance brought forward Cash available for appropriation Cash carried forward 500,000
297,021 500,000 797,021 797,021
1,673,877 797,021 2,470,898 2,470,898
1,919,209 2,470,898 4,390,107 4,390,107
2,096,030 4,390,107 6,486,138 6,486,138
(473,063) (473,063) 1,801,857 6,486,138 8,287,994 8,287,994
2,228,203 8,287,994 10,516,197 10,516,197
2,286,543 10,516,197 12,802,740 12,802,740
2,338,096 12,802,740 15,140,836 15,140,836
2,381,632 15,140,836 17,522,468 17,522,468
5,329,492 17,522,468 22,851,960 22,851,960
500,000 500,000
KEY ASSUMPTIONS
Cost of Goods Sold per Unit of Production Rs. 74/ piece 6%
Table 11-1
COGS 1 COGS 2 COGS growth rate
COGS 1 includes cost of raw material which is acquired in Kgs but calculated as per piece cost. The COGS growth rate is estimated @ 6 % per year.
Table 11-2
Revenue Assumptions Rs. 120 / piece 5%
Sale price per Piece in year 1 Sale price growth rate
Table 11-3
Production Related Assumptions 120,000 pieces 70% 10% 85%
Production capacity per year Production capacity utilization in first year Production capacity utilization growth rate Maximum production capacity utilization
Table 11-4
Economic Related Assumptions 6% 6% 6% 6%
Inflation rate Wage growth rate Electricity Growth Rate Water Price Growth Rate
Table 11-5
Financing Assumptions 18% 0% 100% 22% 18% 18%
Interest rate on long term debt Debt Equity Tax rate (15% sales tax + 7% income tax) Required rate of return on equity WACC
Table 11-6
Expense Assumptions 30 % 0.7 % 0.7 % 12 % Rs. 80,000
Communication Expense Promotional Expense Professional Fee (Legal, Audit etc) Office Expense (Stationary, Entertainment, Janitorial Services) Pre-Operational Expense
Table 11-7
Depreciation Rates 10% 10% 10% 20%
Furniture & fixtures Equipment & tools Office equipment Office Vehicle
Table 11-8
Cash Flow Assumptions 30 30 Rs. 500,000
Accounts Receivables Cycle (In Days) Accounts Payable Cycle (In Days) Cash in Hand
Table 11-9
Direct Operating Costs 7,700 154,000 130,900 550,000
Maintenance Cost / year Direct Electricity Cost / year Direct Gas Cost / year Direct Labor Cost / year

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Pre-Feasibility Study

Plaster of Paris Tiles / boarders, Trim & made-ups

Small and Medium Enterprise Development Authority

Plaster of Paris Tiles, Borders & Made-ups

2 BAL-PREF- /June, 2011

Plaster of Paris Tiles, Borders & Made-ups

Plaster of Paris Tiles, Borders & Made-ups

4 BAL-PREF- /June, 2011

Plaster of Paris Tiles, Borders & Made-ups

5 BAL-PREF- /June, 2011

Plaster of Paris Tiles, Borders & Made-ups

PURPOSE OF THE DOCUMENT

Plaster of Paris Tiles, Borders & Made-ups

7 BAL-PREF- /June, 2011

Plaster of Paris Tiles, Borders & Made-ups

Fig: 1 Percentage of Gypsum usage in various products / services

Defining Plaster of Paris

Type 1.A-fast setting 2.B-regular setting 3.C-slow setting

Start of setting in 2 min 6min 20min

Setting time 15 min 30min 90min

Volume change +1% +1% +2%

BAL-PREF- /June, 2011

Plaster of Paris Tiles, Borders & Made-ups

9 BAL-PREF- /June, 2011

Plaster of Paris Tiles, Borders & Made-ups

10 BAL-PREF- /June, 2011

Plaster of Paris Tiles, Borders & Made-ups

International usage of Moulds and Plaster of paris products:4

11 BAL-PREF- /June, 2011

Plaster of Paris Tiles, Borders & Made-ups

BAL-PREF- /June, 2011

Plaster of Paris Tiles, Borders & Made-ups

Also: Gadrooning, lobed decoration, (k)nukked decoration, thumb molding

13 BAL-PREF- /June, 2011

Plaster of Paris Tiles, Borders & Made-ups

14 BAL-PREF- /June, 2011

Plaster of Paris Tiles, Borders & Made-ups

Proposed Business Legal Status

Plaster of Paris Tiles, Borders & Made-ups

Table: 02: Project financial parameters

Pay Back Period 2.89 Years

BAL-PREF- /June, 2011

Plaster of Paris Tiles, Borders & Made-ups

Ample opportunity for exports. 2. 14 Strategic Recommendations

17 BAL-PREF- /June, 2011

Plaster of Paris Tiles, Borders & Made-ups

CURRENT INDUSTRY STRUCTURE

Plaster of Paris Tiles, Borders & Made-ups

Plaster of Paris Tiles, Borders & Made-ups

MANUFACTURING PLASTER OF PARIS ITEMS

Plaster of Paris Tiles, Borders & Made-ups

Shaping & Treatment:

21 BAL-PREF- /June, 2011

Plaster of Paris Tiles, Borders & Made-ups

Shaping & Treatment

22 BAL-PREF- /June, 2011

Plaster of Paris Tiles, Borders & Made-ups

Furniture & Fixture Total Amount (PKR) 25,000 25,000 50,000