A BUSINESS PLAN ON

STEVIA
.A sugar alternative
A Natural
sweetener
Company name:
Ltd.

Rabioside sugar India pvt.

PREPARED BY:

AWANTIKA
HITESH
RUMKI
GOPAL
KRANTI
AFTAB
RIZWAN
SAIKAT
VIVEK
PIYUSH
SAVITA

Out line of business plan:Sr. No.

1
2
3
4
5
6
7
8

9
10

Particulars

Introductory page
Executive summary
Industry analysis
Production plan
Operational plan
Marketing plan
Organizational plan
Financial plan
Feasibility study
Appendix

Page No.
3
4
6
12
19
21
23
25
31
33

Introductory page:
2

Name of the company: Rabioside sugar India pvt. Ltd.

Address of company:
Rabioside sugar India pvt. Ltd.
Bharathinagar
Dist: Mandya
Karnataka -571 422
Ph.: 08232 - 35546
Fax: 08232 - 35488
Email: rabioside@sugars.com

Product: Stavioside & Rabioside

Total production: 120000 Kgs
This project report is made to capture a start up market of 1.44 %of natural sugar
market.

Total capital investment: Rs. 30000000/Total share capital= 10000000/Loan=20000000/Debt: equity Ratio=2:1 (idle)
Promoters contribution is 6000000/Promoters state in the company is 60%

Executive Summary:
3

Sugar is one of the fastest moving commodities in India. Indian sugar market is
second largest sugar market in the world. India has 531 sugar mills. In 2009 sugar
production was 20.8 million tons where as total consumption was 23.0 million tons
with import of 2.5 million tons.
The Indian sugar industry is marked by co-existence of different ownership and
management structures since the beginning of the 20th century. At one extreme,
there are privately owned sugar mills in UP that procure sugarcane from nearby
cane growers. At the other extreme here are cooperative factories owned and
managed jointly by farmers, especially in the western state of Gujarat and
Maharashtra. There are state owned factories in both the states and state-managed
cooperatives in UP. Sugar is Indias second largest agro-processing industry, with
around 400 operating mills as of March 2005. The 203 cooperatives are a dominant
component of the industry, which accounts for over 56% of the total capacity (19 mt
per annum) nearly 83 (or 41% of total cooperatives) are concentrated in
Maharashtra, followed by UP with 28 mills.

Industry analysis:
The sugar industry is the second largest agro-based industry next to textiles in India.
In India, sugarcane is the key raw material for the production of sugar. The sugar is
extracted from two different raw materials sugarcane and beet; both produce
identical refined sugar. Sugarcane is grown in semi-tropical region and accounts for
around two-third of world sugar production. Beet is grown in temperate climate and
accounts for the balance one third of world production.
In India sugar is an essential item of mass consumption and the cheapest source of
energy, supplying around 10% of the daily calorie intake. With rising income
Indias sugarcane cultivation area of 4-4.5 million hectares accounts for 2.7% of
Indias cropped area. India is the second largest sugar producer in the world (after
Brazil), an estimated production of 18.6 million tonnes in sugar year 2006
accounting for around 10-12% of worlds sugar production. Sugar industry
accounted for around 1% of GDP of the country during financial year 2005. Further,
sugar industry contributes an estimated Rs. 17 billion annually to national
exchequer and treasuries of various state governments by way of excise duty and
purchase tax on sugarcane. Within India there are a number of larger, private, well
managed, dynamic sugar companies such as Balrampur chini, Thiru Arooran, Bajaj
Hindustan, Dhampur Sugar, Sakthi Sugar, Triveni Sugars and Shriram Industrial
Enterprises Ltd. such companies have access to international finance and financial
services.
Sugar industry is one of the few industries that still remain under government
control. Due to the politically sensitive nature of the industry, the government still
continues to regulate sugar release; sugarcane procurement area and pricing of
sugar cane. The centre also regulates the release mechanism for sugar. Release can
be classified as free sale sugar and leavy sugar. Free sale sugar refers to the quantity
that mills are permitted to sell in the open market. Leavy sugar refers to the
quantum of sugar that mills have to give to the government for sale through the
public distribution system.

Production Cycle to Resurge in MY 2009/10:

6

Sugarcane and sugar production in India typically follows a 6 to 8 year cycle,

wherein 3 to 4 years of higher production are followed by 2 to 3 years of lower
production.
The production cycle is set to resurge after the two consecutive years of declining
sugar production. Lower production coupled with liquidation of a high sugar stocks
carryover from previous years, resulted in an increase in sugar prices, which in turn
has helped the Indian sugar industry ameliorate the financial crisis. Industry sources
report that high sugar prices coupled with the tight cane supply forced mills to pay
higher cane prices and issue timely payment to farmers. Strong gur prices
encouraged gur manufacturers to pay higher cane price (Rs. 1200-1800 per ton vs.
Rs. 600 to 1200 per ton last year). Consequently, cane price realization and net
returns to sugarcane farmers has been considerably higher during the MY 2009/10
compared to the previous years. With the prices of food grains (wheat, rice, maize,
pulses) being relatively stable, conditions are favorable for sugarcane planting vis-vis alterative crop rotations of food grains.

Consumption:
7

The recent slowdown economy growth and expected strong sugar prices due to
forecast tight supplies should contain any growth in consumption in MY 2010/11 to
23.0 million tons, unchanged from last year. Bulk consumers such as bakeries,
makers of candy and local sweets, and soft-drink manufacturers account for about
60 percent of mill sugar demand. Most of the sugar is consumed by local sweets
manufacturers. Gur is mostly consumed in rural areas for household consumption.
Prices and stocks:
With relatively tight domestic supplies, sugar prices have been on the rise since July
2008. Prices have flared up significantly since December 2008 after the shortage of
sugarcane and sugar became more evident. Gur prices have kept pace with sugar
prices and have now reached record levels.

Current sugar prices in major domestic wholesale markets range from $410 to $450
per ton, nearly 45 percent higher than last years level. Prices are expected to gain
in the coming months and remain firm during MY 2010/11.
Sugar plant size (in terms of cane crushed per day) is the main criteria for
determining the productivity and viability of the sugar industry. In India, because of
8

traditional industry like Gur and khandsari manufacturers fragmentation, lesser cane
availability, and competition for cane, has resulted in lower plant sizes. Sugar mills
in India have capacities ranging from below 1,250 tonnes crushed per day (tcd) of
sugarcane to 10,000 tcd. The Government has now established minimum capacity
criteria for new sugar mills standing at 2,500 tcd. Capacity limits have increased
considerably over the duration of the industry, between 750 tcd in the oldest
factories to 10,000 tcd in the most recent factories. The report of the task force on
sugar industry for 10th five-year plan had noted that nearly 84% of sugar mills had
a capacity of below 2,500 tcd but at present, only around 22% of the sugar mills
have an installed capacity of 2,500 tcd.
State-wise Distribution of Co-operative and other sugar mills:

State
A.P.
Gujarat
Haryana
Karnataka
Maharashtra
T.N.
U.P.
Uttaranchal
Punjab
others
Total

Cooperatives
No. of
Installed
factories capacity
8
192
17
1071
10
353
16
551
82
5468
14
546
28
784
4
133
12
405
12
182
203
10684

Others
No. of
Installed
factories
capacity
26
716
0
0
3
198
21
908
20
511
20
979
78
3753
6
279
8
279
15
678
197
8302

Total
No. of
Installed
factories capacity
34
908
17
1071
13
551
37
1459
102
5978
34
1524
106
4537
10
412
20
684
27
861
400
18985

SWOT Analysis of the Sugar Industry

Strengths
Indian sugar industry is the second
largest producer of sugar in the world
after Brazil. The sector has a potential to
make the country to be self reliant in
this highly sensitive essential
commodity of mass consumption.
Annual tax contribution to exchequer
Rs. 17 billion annually.
Provides direct employment including
ancillary activities to near about 0.5
million workers
It also supports the down stream
industries by providing the raw material.
Sugarcane farming is more profitable
then any other cash crop in India.
This sector have been the focal point
of socioeconomic development of the
rural India
Strong government policies as it
comes under essential commodity of
mass consumption
Opportunities
High value of by-products for down
stream industries.
Huge potential to increase the
productivity of cane and sugar recovery
rate.
Technology up gradation, new
advanced technology available for the
by product utilization.

Weaknesses
Most of the Co-operative sugar
industries in India e. g. in Maharashtra
find difficult to pay for the sugar cane
supplied by the farmers.
Most of the sugar factories are more
then 30 years old and still using the old
technology low installed production
capacity leads to the decrease in
production and losses.
Lack of professionalism

Threats
Sugar sector is vulnerable to political
interest.
Ground water availability for
irrigation.
Quality of soil deteriorates due to
overuse of fertilizer and pesticides to
increase sugarcane yield.
Unhealthy competition between
members of the society.

10

STATEWISE SUGAR PRODUCTION IN INDIA (000 tonnes)

States

1988 1989 1990

1989 1990 1991

1991
1992

1992
1993

1993
1994

1994
1995

1995
1996

1996
1997

1997
1998

Andhra Pradesh 507

566

701

843

540

647

874

859

772

782

Bihar

317

333

413

460

325

230

39

382

362

299

Gujarat

578

667

831

753

751

826

759

1130

967

890

Haryana

280

336

375

489

345

308

343

453

490

382

Karnataka

702

796

942

1032

847

831

1225

1263

871

959

Kerala & Goa

22

23

18

26

19

10

28

32

20

16

Madhya Pradesh63

72

103

128

60

37

70

125

86

68

Maharashtra

2629 3923 4119

4213

3360

2746

5025

5394

3345

3847

Punjab

245

295

275

384

409

311

319

633

613

331

Rajasthan

14

12

23

37

24

16

18

31

24

29

1231

1327

1021

1122

1921

1671

1083

1266

T.N. & Pondy. 1058 925

U.P. Central

972

1264 1176

1497

1192

1055

1455

1777

1632

1600

U.P. East

620

703

953

787

677

1012

1043

1058

881

U.P. West

710

1042 1030

1204

878

983

1142

1559

1393

1441

30

56

48

34

58

99

89

64

Others- Assam,
Orissa,
33
Nagaland &
West Bengal
All India

769

39

8752 10988 12047 13404 10609 9833

14643 16451 12905 12855

Production plan:
11

Stevia:
Stevia is a genus of about 240 species of herbs and shrubs in the sunflower family
(Asteraceae), native to subtropical and tropical regions from western North
America to South America. The species Stevia rebaudiana, commonly known
as sweet leaf, sweet leaf, sugar leaf, or simplystevia, is widely grown for its sweet
leaves. As a sweetener and sugar substitute, stevia's taste has a slower onset and
longer duration than that of sugar, although some of its extracts may have a bitter
or licorice-like aftertaste at high concentrations.
With its extracts having up to 300 times the sweetness of sugar, Stevia has garnered
attention with the rise in demand for low-carbohydrate, low-sugar food alternatives.
Medical research has also shown possible benefits of Stevia in
treating obesity and high blood pressure. Because Stevia has a negligible effect
on blood glucose, it is attractive as a natural sweetener to people on carbohydratecontrolled diets.
The availability of Stevia varies from country to country. In a few countries, it has
been available as a sweetener for decades or centuries.

Production Description:Stevia is a plant which is the native of northern America. Stevia plan contain tow
main secondary metabolites viz, Rabioside and Stavioside. Both the products are
natural sweetener having the following advantages over normal sugar:1.
2.
3.
4.

Low calorific value

Not harmful for Hypertension and Diabetes.
300 times sweeter than normal sugar.
Availability doesnt depend on environment.

The advantage of stevia plat is its low seed producing capacity. Thus to cultivate
stevia plant for the production of its metabolites micro propagation is the only way.
Thus for the production of Rabioside and Stavioside, setting up of a micro
propagation is necessary.

12

Production scale:
By studying the sugar demand and supply in the recent years it was seen that India
is importing 2.5 million tons of sugar every year.
To meet this demand by Rabioside and Stavioside, India needs to produce about
8334 tons (2.5 million tons /300) of Rabioside and Stavioside every year (as
Rabioside and Stavioside are 300 times sweetener then sugar).
Thus it can be concluded that India has a domestic market for 8334 tons of
Rabioside and Stavioside every year.
The capacity of the unit will be 120 tons (120000 Kg) of Rabioside and
Stavioside per annum.
This project report is made to capture a start up market of 1.44 % (120/8334) of
natural sugar market.

Bench scale concept:A bench or laboratory scale production is done with a capacity of 12 kilograms per
annum and it was found that at certain contr4olled conditions the leaves of Stevia
plant contains around 17% of Rabioside and Stavioside.
The protocol for bench scale Rabioside and Stavioside production is as under:Stevia rebaudiana plant is cultured in MS media. Leaf, nodal and intermodal
segments of the plant is selected as explants. The media is supplemented with
various amounts of growth hormones and other chemicals and at certain levels of
hormones the leaves are found to contain 17% Rabioside and Stavioside. And these
levels of hormones are selected to conduct the pilot scale production.
In laboratory scale production, 12 kilograms of Stavioside and Rabioside are
produced. From production of 12 kilograms of Stavioside and Rabioside, 71
kilograms of stevia leaves are produce by the process of micro propagation.
6 months was the lock-in period for the production of Stavioside and Rabioside by
the process of micro propagation.
Pilot scale Production:
13

After successfully performing the bench scale production a standard protocol was
developed and with this protocol pilot scale production is done with a production
capacity of 50 kilograms per annum.
In pilot scale production the following problems are observed:1. The contamination by the fungi and bacteria can damage the complete lot of
Stevia plant as in the growth room condition, the plants need to be supplied
with growth media many times thus increasing the chance of contamination.
2. The amount of media need to develop a callus into seedling is found to be
30ml.
Pilot scale production is done successfully with the protocol standardized in
laboratory scale production, and in pilot scale production also the amount of
Stavioside and Rabioside content is found to be 17%.

Industrial scale production:After successfully completion of laboratory and pilot scale production successfully
it is concluded that the production of natural sweetener by the process of micro
propagation is viable and economically feasible. For the production of 120000
kilograms of Rabioside and Stavioside, the need of Stevia leaves is around 705883
kilograms.
The lock-in period of Stavioside and Rabioside production is found to be around 6
months in both bench and pilot scale production.
The weight of the leaves of a 6 months old Stevia plant is around 75 grams
excluding the damages. Thus for production of 705883000 grams of Stevia leaves
we need to produce 9411774 plantlets per annum.
If we produce 9411774 plantlets per annum, the amount of leaves will be
9411774 * 75grams = 705883000 grams = 705883 kgs of Stevia leaves
The Rabioside and Stavioside content of Stevia leaves is found to and 17%, thus
from 705883 kgs of Stevia leaves we can extract 17% of 705883 kgs = 120000 kg

14

Stages of Tissue Culture:

The stages involved in propagation by tissue culture are dividend into five. A
general account of these stages is outlined below.
a) Choice of explants
Explants could be shoot tips (meristem), nodal buds, sections from internodes,
leaves, roots, centers of bulbs, corms or rhizomes, or other organs. The choice
depends on the species to be multiplied and the method of shoot multiplication to be
followed. Activity growing (shoot tips), juvenile (seedlings) or rejuvenated
(suckers) tissues are preferred.
The commercial tissue culture tabs commonly use tips of apical or lateral shoots,
which contain meristem. Meristem is made up of cells dividing actively in an
organized manner. They are about 0.1 mm in diameter and 0.25 0.30 mm. in
length. However, explants should be chosen from typical, healthy, disease free, well
tested mother plants cultivated under conditions which reduce contamination and
promote growth of tissues to be cultured. If necessary explants may be subjected to
virus testing and elimination. The selection of mother plants is very important for
commercial success of tissue culture propagation.
The quantity of explants required for propagation by tissue culture is very small.
For example, 2mm. thick petiole sections from African violet (a flowering herb)
could yield 20,000 plantlets per petiole (basal portion of leaf). Foreign/local
collaborators with established business may agree to supply explants free of cost.
b) Establishment of Germfree (aseptic/sterile) culture
Excised part of plant is surfaced sterilized and transferred to sterile nutrient medium
contained in glass vessel. On an average, about 50cc. nutrient medium may be
added per glass vessel. The cultures are maintained in growth rooms. If there is no
infection and tissue isolated from mother plants survive in the artificial
environment, initiation of new growth will take place after a week or so. Thus,
germ-free culture is established.

c) Production of shoots/propagules
15

Once growth is initiated by induction of meristematic centres, buds develop into

shoots by multiplication of cells. There are three types of multiplication systems for
production of shoots.
i) Multiplication by axillary shoots
In this case shoots are produced from excised shoot tips of nodes. Hormones
(cytokinins) are used to induces multiple branching. This is the most common
method followed in commercial units. However, the rate of multiplication is low.
Still it is preferred, because axillary shoots are likely to be genetically stable and the
chances of production of types unlike mothers are less.
ii) Multiplication by adventitious shoots
Explants such as sections of leaves, internodes or roots can produce directly
adventitious shoots or other organs. This system has higher multiplication rate, but
lesser genetic stability than axillary system.
iii) Multiplication by somatic embryos (embryoids)
Embryos are usually formed by the union of male and female
reproductive cells (zygotic embryo) which ultimately can develop into a young
plant. Embryo like structures can also be produced from somatic cells. Somatic
embryos are independent bipolar structures and are not attached to the tissues of
origin. The also can develop to form young plants like zygotic embryos may be
produced directly from explants such as sections of leaves, internodes or roots on
solid culture medium.
The formation of young plants mentioned under (a) and (b) above, or formation of
somatic embryos, mentioned in the preceding para, directly on excised plant parts
occurs only in certain species.
The most common form of regeneration of plants occurs indirectly from callus.
Callus is mass of undifferentiated diving cells often formed in tissues cultured in
vitro. Callus may give rise either to adventitious shoots, which develop into
plantlets, or somatic embryos, which develop into seedlings. Callus is formed even
naturally in response to wound.

16

The formation of callus can be induced by selecting proper tissue and culture
medium. This system has the highest multiplication rate and produce complete tiny
plants. One gram of explants can produce one lakh somatic embryos. Dormancy can
be induced in them or they can be transformed into synthetic seeds. However, callus
is genetically unstable or plants arising from it may be unlike mother plants. Such
plants are known as off-types. They occur more frequently in callus culture and
adventitious shoot culture as compared to axillary shoot culture. Off-types are
undesirable in commercial propagation. Regeneration of shoots or intact p0lants by
any one of the multiplication systems described above is influenced by many
factors, such as composition of medium (specially concentration of growth
regulators), type of tissue, genotype, ploidy level, etc.
Normally, multiplication cycle i.e., the period from incubation of plant parts on
medium to formation of shoots varies from 3 to 6 weeks. However, the process is
recycled many times by sub-culturing in order to obtain required multiplication
rates. After completion of a cycle, shoots are cut separately and transferred to fresh
medium. Cutting is done manually by using dissecting tools in laminar flow
cabinets, where the air is clean to prevent any contamination. Once the shoots are
placed on fresh medium, they are transferred back to the growth rooms. Thus, it
may be possible to multiply the shoots 3 to 10 times per cycle of 3 to 6 weeks
duration.
d) Preparation of micro-cuttings for establishment in the natural environment
Young axillary or adventitious shoots are finally separated form clusters (micro
cutting) for initiation and development of roots. After separation, they are
transferred individually to a medium containing rooting hormone (auxin) and
continued to be maintained in the growth rooms until the roots are formed. It may
green house for root formation. Somatic embryos may directly develop into
seedlings.
e) Establishment in the natural environment
The most critical stage of the propagation by tissue culture is the establishment of
the plantlets into the soil. The steps involved are as under
- Washing of media from plantlets,
- Transfer of plantlets to compost/soil in high humid green house,
- Gradual decrease in humidity from 100% to normal over 3-4 weeks,
- And gradual increase in light intensity.
Plantlets during their growth in laboratory do not photo synthesize and their control
of water balance is very weak. They use sugar contained in medium as source of
17

energy. They exist like bacteria (heterotrophy). They need to be converted to more
plant like existence (autotrophy) i.e., they should be in a position to utilize carbondi-oxide from the air and solar energy for their food requirement. This
acclimatization on the harsh real environment, outside artificial laboratory milieu
takes place gradually.
Culture environment
Environment conditions in the growth room which influence cell multiplication are
light, day length and temperature. In tissue culture, light is required for synthesis of
green pigment (chlorophyll) and development of organs. The range of light
intensities appropriate for culture room varies from 1000 to 5000 lux. Requirement
of day length would be in the range of 16-18 hours. Temperature requirement of day
length would be in the range of 16-18 hours. Temperature requirement varies from
200-300 C depending on species of plants. Tropical plants may require higher
temperature than plants.
Prevention of contamination
Prevention of contamination in tissue culture is extremely important for commercial
success of the unit. The entire production can go waste if the culture is
contaminated. Sugar rich culture medium, excised plant tissue and culture
environment are all conducive to the growth of pathogens. Therefore, it is essential
that all operations are conducted in sterile or aseptic conditions. Various stages
involved in prevention of contamination are outlined below: - Mother plants should
be grown under conditions which do not promote diseases. Explants should be free
of diseases. Surface sterilization of explants in solutions of sodium or calcium
hypochlorite is necessary. Heat or treatment with certain chemicals may eradicate
latent viruses. All equipments and culture media are sterilized by autoclaving at
15lb.sq. Inch pressure at 1200 C for 15 minutes. The laboratory should be cleaned
with disinfectants. They should put on sterilized clothes. Double distilled water
should be used for washing explants cabinets, hatches and instruments. Air handling
units are employed for growth rooms and culture transfer rooms in order to avoid
cross contamination between different areas of operation inside the clean area. The
sterile condition is obtained in laminar air flow cabinets as they are provided with
special type of international standard HEPA filters. These filters remove all the dust
particulars of above 0.3 micron in the air.

Operational plan:
18

Karnataka Sugar Industry:

Karnataka Sugar Industry ranks 3rd in terms of its contribution of sugar in the total
sugar production in the country. The Sugar Industry in Karnataka is able to
manufacture sugar in such huge quantities due to the fact that sugarcane is
abundantly available in the state. In fact, Karnataka stands 4th in the country in the
cultivation of sugarcane.

The Sugar Industry in Karnataka has around 41 sugar factories which are
distributed all over the state. The various locations of the sugar factories of
Karnataka Sugar Industry are Konnur, Varuna, Koppa, Madapura, Dandeli,
Jambagi, Hosur, Margur, Yelgur, Siddapur, and Arsanghatta. The major benefits of
Karnataka Sugar Industry are that it has generated many facilities in the state such
as communication, employment, and transport. It has also benefited the state by
helping in the development of the rural areas of the state by mobilizing the various
resources of the villages.

19

Location:
For setting up the poly house and plantation of stevia plants the place selected is
Mandya which is around 120 kms from Bangalore.
Advantage of Mandya:
1.
2.
3.
4.
5.

Close to Bangalore
Connected to Bangalore -Mysore expressway
20 kms from Mysore railway station
Low cost of labour
Low cost of agricultural land

10 acres of land has been selected in Mandya Mysore way. The advantage of the
land selected:
Located just 1 km from highway
From highway tar road is there so lorries can move to proposed warehouse
for loading and unloading thus reducing the cost
The width of the road is 12-15 ft.
The cost of the land is very reasonable
The land is with clear titles
The land is not co-share holding property thus chance of any further dispute
is very less.

Availability of Raw Material:

The list of the raw material required:1. Growth media on a regular basis.
2. Chemicals on a regular basis.
Both the about mentioned raw materials can be purchased from Bangalore by the
competitive price and can be delivered to the site.

20

Marketing plan:

21

22

Organizational plan:
Business model:
The business proposal is prepared for a company a company which needs to be
registered under Companies Registration Act 1958. For this first a name should be
selected and then it has to be registered with Registrar of Company with form 1A.
The name of the company is selected as Rabioside sugar India pvt. Ltd..

Name of the Promoters

AWANTIKA
HITESH
RUMKI
GOPAL
KRANTI
AFTAB
RIZWAN
SAIKAT
VIVEK
PIYUSH
SAVITA

Total share capital= 10000000/Loan=20000000/Debt: equity Ratio=2:1 (idle)

Promoters contribution is 6000000/Promoters state in the company is 60%

23

Manpower:
For the production of 9 million plantlets per annum the total no. of employee
will be:Laboratory technicians: 12
Poly house officer: - 3
Accounts: - 2
Assistant manager: 2
Extraction staffs: - 2
General manager/chief:-1
Driver:-1
Cleaning staffs:-2
Out of the employees 12 will be graduate in biotechnology, 3 will be science
graduate, 2 from commerce with sound knowledge in accounts, 2 will be post
graduate (either M.Sc. or M.Tech.) in biotechnology with experience in plant tissue
culture, 2 will be graduate or post graduate in science with knowledge in plant
tissue culture, 2 will be graduate or post graduate in science with knowledge in
extraction techniques such as HPLC etc. I will be PhD. in biotechnology, and for
the post of driver and cleaning staff person with nominal education will be enough.
Close proximity to customer and market competition:There are more than 500food processing companies in and around Bangalore which
all are using sugar as a raw material fro their production. On an average these
companies totally uses near about 2.5 crore kilos (considering 5 tons per company
per year) of sugar every year, which can be replaced by near about 83300 kilos of
Stavioside and Rabioside.
The above fact shows that in close proximity of Bangalore the demand for
Stavioside and Rabioside is 83300 kilos and the supply is almost nil. Thus showing
a tremendous growth possibility for the production of Stavioside and Rabioside.

24

Financial plan:
Investment Details:
Liabilities:
Capital
Loan

10000000
20000000

Total Liabilities

30000000

Total Liabilities: Rs.30000000/Assets:

Fixed Assets:
Land :10 Acers at Rs.100000
Building: Total area of 10000 Sq.Ft in 2 floors at 800 per Sq.Ft
Machinery and equipments
Furniture
Total fixed assets:

1000000
8000000
7500000
500000
17000000

Movable assets:
Growth media: 270000 lits at 25 per lits
Water supply system
Misc construction materials like polythin, tarpaulin etc
Reserve for salaries and other recurring costs like electricity and
phone bills etc
Total movable assets:

6750000
70000
1500000
4680000
13000000

Total Assets: Rs.30000000/Statutory permits:25

1. The promoters of the companies need to take a DIN (Directors Identification

No.) from ROC.
2. After that a name has to be registered by properly filling up the from 1A,
which has to be signed by at list 2 directors.
3. A managing director has to be appointed by the board of directors by filling
up the form 18A.
4. The unit has to take the shops and Establishment registration from local
Labour office for employment and appointment.
5. Municipal trade license is mandatory for doing any trade in the municipal
region.
6. The company has to take a VAT registration for selling his products.
7. The company must have PARMANENT ACCOUNT NO of INCOME TAX
department for giving the return.
8. Pollution control board must give a NOC as per the environment protection
act 1986.
9. Permission for public issues from SEBI.

26

Balance sheet:
Liabilities
Promoters contribution
Venture capital
Total Share Capital

Loan from SIDBI @ 12%

Loan from Department of
Biotechnology @ 8%

Total Loan

Total Liabilities

Assets
6000000 Fixed Assets:
4000000 Land
Building
10000000 Machinery and equipments
Furniture

Movable assets:
Growth media
7000000 Water supply system
1300000 Misc construction materials like
0 polythin, tarpaulin etc
Reserve for salaries

1000000
8000000
7500000
500000
1700000
0
6750000
70000

20000000

1500000
4680000
1300000
0

30000000 Total Assets

3000000
0

27

Utility Area:
A.

Clean Area
media store and production control
production autoclave area
culture transfer room
growth rooms
change area

B.

semi-clean area
lag wash
laboratory/Media
wash area
(i)bottle
(ii)plant
store

Floor Area (Sq.Ft) Total (Sq.Ft)

500
400
1500
650
650
300
4000
100
500
500
500
400
2000

C.

service area
office lobby, corridor
scientist room
computer room
guest room
canteen
toilet
total
covered area(approx.)

1500
300
100
150
800
150

3000
9000
10000

28

List of equipments with price:

Sr. No.
1
2
3
4
5
6
7

8
9
10
11
12
13
14

Particulars
Autoclave
Balances
pH meter
Laminar airflow
Distillation set
Computer system
Air- conditioners
a)1.0 tonnes
b)1.5 tonnes(2 stand by)
Microscopes
Bottle washing unit
Media cooking unit

15
16
17
18
19

Growth room racks

Trays
Trolleys
Diesel Genset (62.5 KVA)
Dissecting Kits and
Inoculation instruments
Refrigerator
Air filters
Oven
Rotary Shaker

20
21
22
23
24
25

Bottles
Lab cloths
Washing machine
Incinerator
Fire fighting equipment
Stabilizers

No.
5
2
2
10
2

6
8

Rate
(Rs./Pc)
184000
45000
7000
65000
36000
200000

1
1

25000
30000
20000
300000
100000

Custom make
80
20
1

1000000
6000
1300
265000

2
2
3
2

25000
10000
15000
15000
25000

4500000
1
1
10

0.3
25000
15000
25000
20000
2800

Rs.
920000
90000
14000
650000
72000
200000
150000
240000
20000
300000
100000
100000
0
480000
26000
265000
25000
20000
30000
45000
50000
135000
0
25000
15000
25000
20000
28000
29

26
27

Miscellaneous Glassware
Tube lights for growth
rooms

28

HPLC

100000

100000

40

240000
100000
0

6000
Custom make

Total cost of equipments=7500000/List of Furniture and Fixture:

Sr.No.
1
2
3
4
5
6
7

Particulars
Tables for GM and Assistance manager
Clerk
Lab. Table
Chairs and Sofa set
Cupboard
Lab. Racks
Miscellaneous

Rate
22000
2000
18000
30000
13000
5000
3000
93000

8
9
10
11
12
13
14

Tube lights for offices, lobby etc.

Fans
Fax Machine
Telephone
typewriter
Intercom
Pick up Van

4000
6000
25000
8000
12000
12000
340000

407000
500000

Total cost of Furniture=500000/-

30

Overheads:
Sr.
No.

Salary
1 General Manager 1
2 Assistant Managers
a. Laboratory
b. Greenhouse
c. Marketing and
Accounts

3
4
5
6
7
8
9
10

Technicians
Managers
Clark
Guards
Driver
Mechanic
Typist
Contingencies
Total

Salary/Mont Salary/yea
No.
h
r
1
27000
324000
2
2

20000
20000

20000

12
2
1
3
1
1
1

12000
20000
4000
3000
2500
2000
2000

1200000
1728000
480000
48000
108000
30000
36000
36000
10000
4000000

Total overheads per month=333335/Total overheads per year=4000000/-

31

Project feasibility study:

Financial analysis based on cash flow Technique indicates that Project is financially
viable, as would be evident from the following data:
Total yearly expanses (Rs.):
Salary
Interest on Loan from Department of Biotechnology @ 8%
Interest on Loan from SIDBI @ 12%
Other recurring cost @20000/month
Total

4000000
840000
1040000
240000
6120000

Total production: 120000 kgs

Total production cost: Rs. 6120000/Cost per Kg. = Rs. 51/Lock in period for the project is 6 months, i.e. production will start after 6 months
from the date of production work.
Financial projection for the 5 years:-

Production in Kg
Cost of Production
Salary
Selling price/Kg.
Other expanses

1st
60000
51
4000000
115
2120000

2nd
120000
51
4000000
115
2120000

3rd
120000
51.6
4070000
120
2120000

4th
120000
52
4100000
125
2120000

5th
120000
52.5
4150000
125
2120000
32

including interests
Total Revenue
Total expanses
Net Profit

6900000 13800000
6120000 6120000
780000 7680000

14400000
6190000
8210000

15000000
6220000
8780000

15000000
6270000
8730000

Capital budgeting:
Total capital investment: Rs. 30000000/Year
1
2
3
4
5

Cash in flow(Rs.)
780000
7680000
8210000
8780000
8730000

cumulative cash flow(Rs.)

780000
8460000
16670000
25450000
34180000

So, break even point is 4 years 6 months and 92 days.

Financial analysis based on cash flow Technique indicates that Project is financially
viable and company will recover total initial investment in is 4 years 6 months and
92 days (as break even point is 4 years 6 months and 92 days).
Exit Strategy:
Rabioside sugar India pvt. Ltds exit strategy is to move toward an IPO,
depending upon the current market or acquisition by a larger sugar producer.

33

Appendix:
References:www.sugarindia.com
www.vsisugar.com
www.fcamin.nic.in
www.cogenindia.org
www.staionline.org
www.coopsugar.org
www.indiansugar.com
www.fcamin.nic.in

34