DETAILED PROJECT REPORT

KODO MILLET COOKIES MANUFACTURING UNIT.

INDIAN INSTITUTE OF FOOD PROCESSING TECHNOLOGY

Ministry of Food Processing Industries, Govt. of India

Thanjavur

2021

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 Contents

Sr. No. Topic Page

The Project at a Glance 3
1 General Overview of Kodo millet production, Clusters, PHM and value addition in
India
1.1 Introduction 4
1.2 Origin, Distribution and Production of Kodo millet 5
1.3 Varieties 5
1.4 Health benefits and Nutritional Importance 6
1.5 Cultivation, Bearing & Post-Harvest Managements 9
1.6 Processing and Value Addition in India 11
2 Model Kodo millet cookies processing under FME Scheme
2.1 Location of Proposed project and land 15
2.2 Installed capacity of Kodo millet cookies processing plant 15
2.3 Raw Material requirement for The Unit 15
2.4 Manufacturing Process 16
2.5 Market Demand &supply for Kodo millet cookies 17
2.6 Marketing strategy for Kodo millet products 18
2.7 Detailed Project Assumptions 18
2.8 Fixed capital Investments
2.8.1 Plants and Machinery 19
2.8.2 Other Costs 19
2.9 Working Capital Requirements 20
2.10 Total Project Cost & means of finances 21
2.11 Manpower Requirements 22
2.12 Expenditure, Revenue and Profitability Analysis 23
2.13 Repayment Schedule 24
2.14 Assets depreciation 25
2.15 Financial Assessment of project 26
2.16 Break even analysis 28
2.17 Pie chart 30
2.18 Plant Layout 31
2.19 Machinery suppliers 31
3 Limitations of Model DPR & Guidelines for Entrepreneur
3.1 Limitations of Model DPR 32
3.2 Guidelines for Entrepreneurs 32

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 The Project at a Glance
1 Name of the Project Kodo millet cookies
2 Name of the entrepreneur/FPO/SHG/Cooperative

3 Nature of proposed project Proprietorship/Company/

Partnership
4 Registered office
5 Project site/location
6 Names of Partner (if partnership)
7 No of share holders (if company/FPC)
8 Technical advisor
9 Marketing advisor/partners
150 MT/annum (55, 65, 75,90 and
10 Proposed project capacity 100% capacity utilization in the
2nd, 3rd, 4th year, 5th year and
6th year onwards respectively
11 Raw materials Kodo millet flour
12 Major product outputs Kodo millet cookies
13 Total project cost (Lakhs) 20.14
Land development, building & civil construction 5.18
Machinery and equipments 6.31
Utilities (Power & water facilities) 0.8
Miscellaneous fixed assets 0.9
Pre-operative expenses 0.90
Contingencies 1.20
Working capital margin 4.85
14 Working capital Management (In Lakhs)
Second Year 14.55
Third Year 17.19
Fourth Year 23.45
15 Means of Finance
Subsidy grant by MoFPI (max 10 lakhs) 9.87
Promoter’s contribution (min 20%) 4.83
Term loan (45%) 5.44
16 Debt-equity ratio 2.35 : 1
17 Profit after Depreciation, Interest & Tax
2nd year 33.30
3rd year 40.90
4th year 48.49
18 Average DSCR 2.16
Benefit Cost Ratio 2.048650013

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 Term Loan Payment 7 Years with 1 year grace period
Pay Back Period for investment 2 Years
Note: All the data/contents of this DPR are taken from the available information on IIFPT
site.
1 GENERAL OVERVIEW OF KODO MILLET PRODUCTION,
CLUSTERS, POST-HARVEST MANAGEMENT AND VALUE
ADDITION IN INDIA

1.1 INTRODUCTION

Paspalum scrobiculatum, commonly called Kodo millet or Koda

millet, is an annual grain that is grown primarily in Nepal (not to confuse with Kodo (Finger
millet, Eleusine coracana) and also in the India, Philippines, Indonesia, Vietnam, Thailand,
and in West Africa from where it originated. It is grown as a minor crop in most of these
areas, with the exception of the Deccan plateau in India where it is grown as a major food
source. It is a very hardy crop that is drought tolerant and can survive on marginal soils where
other crops may not survive, and can supply 450–900 kg of grain per hectare Kodo millet has
large potential to provide nourishing food to subsistence farmers in Africa and elsewhere.

Kodo millet scientifically knows as Paspalum scrobiculatum, is an

annual grain that is grown in primarily in India, but also in the Philippines, Indonesia, Vietnam,
Thailand, and in West Africa where it originates. It is grown as a minor crop in most of these
areas, with the exception of the Deccan plateau in India where it is grown as a major food source.
Kodo millet falls in the category of minor millets which are small-seeded species crops, grown
around the world for food and fodder. Essential similarities of the members of this group of
species are the resilience and ability to thrive in harsh environments, along with nutritious seed
content. They have been cultivated since immemorial time. Some of the popular common names
of the kodo millet plant are Indian paspalum, Creeping paspalum, Ditch millet, Scrobic paspalum,
Water couch, Scorbic, Mau’u-laiki, rice grass, rice grass paspalum, Veld paspalum and native
palspalum. Kodo is a popular fast or upvas food in some parts of India. The millet is certainly

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 superior to rice, gluten free and rich in fiber, vitamins and minerals. It has large potential to
provide nourishing food to subsistence farmers in Africa and elsewhere.

Kodo Millet in India is largely grown in the states of Madhya

Pradesh, Chattisgarh, Maharashtra, Tamil-Nadu and Karnataka. It is also cultivated in the Jhum
field of Arunachal Pradesh.

1.2 ORIGIN, DISTRIBUTION AND PRODUCTION OF KODO MILLET

Paspalum scrobiculatum var. scrobiculatum is grown in India as an important

crop, while Paspalum scrobiculatum var. commersonii is the wild variety indigenous to
Africa. The kodo millet, also known as cow grass, rice grass, ditch millet, Native Paspalum,
or Indian Crown Grass originates in tropical Africa, and it is estimated to have been
domesticated in India 3000 years ago. The domestication process is still ongoing. In southern
India, it is called varaku or koovaraku. Kodo is probably a corrupt form of kodra, a Hindi
name of the plant. It is grown as an annual. It is a minor food crop eaten in many Asian
countries, primarily in India where in some regions it is extremely important. It grows wild
as a perennial in the west of Africa, where it is eaten as a famine food. Often it grows as a
weed in rice fields. Many farmers do not mind it, as it can be harvested as an alternative crop
if their primary crop fails. In the Southern United States and Hawaii, it is considered to be a
noxious weed.

1.3 VARIETIES

There are different varieties of Kodo millet growing nationwide.

Varieties of Kodo millet growing nationwide are described below.

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Sl No. State Varieties

1 Madhya Pradesh RK - 65 - 18,JK 439, RBK 155, JK 13, JK 65 and JK 48,

JK 137, RK 390- 25, JK 106, GPUK 3

2 Tamil Nadu KMV 20 (Bamban), CO 3, TNAU 86, GPUK 3

3 Gujarat GK 1 and GK 2, GPUK 3

4 Chattisgarh RBK 155 and JK 43 9, Indira Kodo - 1, Indira Kodo -

48, GPUK 3

5 Karnataka GPUK 3, RBK 155

6 Hill states VL-124, VL-149

1.4 HEALTH BENEFITS AND NUTRITIONAL INFORMATION

Nutritional value:

Kodo millet is a rich source of protein, iron, and calcium. Calcium is vital for our bone
health. It also has a negligible amount of B Vitamins, which are essential for your nervous
system.

100 grams of Kodo millet provides the following nutrients:

• Calories: 353 kcal

• Dietary Fiber: 5.2 grams

• Protein: 9.8 grams

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 • Carbohydrate: 66.6 grams

• Fat: 3.6 grams

• Iron: 1.7 mg

• Vitamin B-6: 0.15 mg

• Calcium: 35 mg

• Vitamin B2: 0.09 mg

• Vitamin B3: 2 mg

CONSTITUENTS AND HEALTH BENEFITS OF KODO MILLETS

Kodo millets also have many potential health benefits. Eating kodo millets may lower your
risk of heart disease, cancer, and kidney stones.

Health benefits:

1. Anti-diabetic:

Kodo millet intake is found to reduce fasting blood glucose level and promotes significant
increase in serum insulin level. Anti-diabetic compounds in Kodo are quercetin, ferulic acid,
p-hydroxybenzoic acid, vanillic acid and syringic acid. Thus regular use is recommended for
diabetic patients.

2. Anti-obesity

Kodo is high in fiber and prevents gain in weight. It also helps to prevent rise in cholesterol
and triglyceride levels and is a functional food to manage weight and promotes weight loss.

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 3. Anti-cholesterol and anti-hypertension:

Kodo is very beneficial for post-menopausal women suffering from signs of cardiovascular
disease, high blood pressure and high cholesterol levels. Hence, regular consumption of
Kodo millets is recommended for all.

4. Helps in weight management:

Kodo millet consists of low fat content and fiber content is higher and makes to feel fuller
after consuming less quantity itself, therefore it avoids over eating and lessens the weight,
thereby controls obesity. An obese person should include this cereal in their diet and see
the difference on their weight.

5. Antioxidant and anti-microbial activity

Kodo millet grains consist of polyphenols and antioxidants. The polyphenols possess
antimicrobial action against certain bacterias (Staphylococcus aureus, Leuconostoc
mesenteroides, Bacillus cereus and Enterococcus faecalis).

6. Cholesterol reduction:

Regular consumption of Kodo millet helps to lower the triglycerides and C-reactive
protein, thus it lowers the bad cholesterol and ideal for your heart. Thus heart protective
food too.

Traditional uses and benefits of Kodo Millet

• Regular consumption of kodo millet is very beneficial for postmenopausal women

suffering from signs of cardiovascular disease, like high blood pressure and high
cholesterol levels.

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 • Kodo Millet helps hydrate your colon to keep your system regular and keep you from
being constipated.
• Kodo Millet helps in controlling Blood sugar and Cholesterol.
• It is easy to digest, contains a high amount of lecithin and is excellent for strengthening
the nervous system.
• It is rich in photo chemicals, phytate that helps in reduction of cancer risks.
• It helps to reduce the body weight and beneficial for postmenopausal women.
• It is good for those suffering from signs of cardiovascular disease, like high blood
pressure and high cholesterol levels.
• Also, it is good for diabetics, its anti – diabetic compounds like quercetin, ferulic acid, p –
hydroxybenzoic acid, vanillic acid and syringic acid from Varagu prevents obesity.
• Kodo millets contain no gluten and are good for people who are gluten intolerant.
• Kodo millets can be used for traditional as well as novel foods.
• Unprocessed or processed grain can be cooked whole or decorticated and if necessary
ground to flour by traditional or industrial methods.
• In tribal sectors, it is cooked as rice also and out of flour tribal population prepares different
recipes.
• Traditionally the grains of Paspalum scrobiculatum are used in the management of diabetes
mellitus.
• Grains are also useful in the treatment of inflammation, hemorrhages and general debility.

1.5 CULTIVATION, BEARING & POST HARVEST

MANAGEMENT:-

Kodo millet is a monocot and an annual grass that grows to heights of

approximately four feet. It has an inflorescence that produces 4-6 racemes that are 4–9 cm
long. Its slender, light green leaves grow to be 20 to 40 centimeters in length. The seeds
it produces are very small and ellipsoidal, being approximately 1.5 mm in width and 2 mm

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 in length; they vary in colour from being light brown to a dark grey. Kodo millet has a
shallow root system which may be ideal for intercropping.

Cultivation and Bearing:-

Kodo millet is a highly drought resistance crop. It is the coarsest of

all food grains. The kodo millet, also known as cow grass, rice grass, ditch millet, Native
Paspalum, or Indian Crown Grass originates in tropical Africa, and it is estimated to have
been domesticated in India 3000 years ago. The grain is covered with a horny seed coat
which should be removed before cooking. The grain contains 8.3 per cent protein, 1.4 per
cent fat, 65.6 per cent carbohydrates and 2.9 per cent ash. The grain is recommended as a
substitute for rice to patients suffering from diabetes disease.

Kodo is grown mostly in warm and dry climate. It is highly

drought tolerant and, therefore, can be grown in areas where rainfall is scanty and erratic.
It is well thrive in areas receiving only 40 to 50 centimetre annual rainfall.

Kodo is grown from gravelly and stony upland poor soils to loam
soils. Deep, loamy, fertile soils, rich in organic matter, are preferred for satisfactory
growth. Well-drained soils with adequate moisture supply are required for uninterrupted
growth of this crop.

During dry periods, irrigations are required every 4-7 days

depending on the severity of the drought and type of soil.

First irrigation at 25-30 DAS and second irrigation at 40-45 DAS.

Drain out the excessive rain water from the field during heavy and continuous rains.

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 Post-harvest management:-

There are some grain handling management after harvesting to avoid post-harvest losses.
Following are Post-harvesting handling practices:

• Grains are graded according to their size. All the diseased, infected, grains are sorted out.
• Do not leave harvested grain out in the hot sun/ rainy weather;
• Wear cotton gloves when harvesting. This reduces chances of getting injured.
• Use picking bags.
• Jute bag, gunny bags are used for storing grains;
• Use clean harvesting bags;
• Make sure packing line equipment is cleaned regularly.
• Remove old and rotten fruit regularly from the packing shed and surrounds;
• Treat harvested grain with a registered fungicide within 24hrs of harvest;

1.6 PROCESSING & VALUE ADDITION:-

Millets are one of the oldest food grains known to mankind and
possibly the first cereal grain used for domestic purposes. For centuries, millets have
been a prized crop in India and are staple diet for nearly 1/3rd of the world's population.
They can adapt themselves to marginal soils and varied environmental conditions. Small
millets are more than just finger millet (Eleusine coracana) and include kodo millet
(Paspalum scrobiculatumi), little millet (Panicum sumatrense), foxtail millet (Setaria
italic), proso millet (Panicum miliaceum) and barnyard millet (Echinochloa
frumentaceae). Millets are most commonly available in the form of pearled and hulled
kind. Millets are tasty grains that have a mildly sweet, nut-like flavour. Millets are rich
sources of protein, dietary fiber, energy and minerals when compared to rice. These
millets have diversified high food value but the consumption of these millets has declined
for want of standardized processing techniques to compete with fine cereals. Hence an
effort was made to increase the utilization of small millets in popular foods which would

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 find ready acceptability with the tag of 'HEALTH FOODS'. Small millet based value
added products including traditional recipes, bakery products, pasta products, flaked and
popped products instant food mixes were developed and standardized. The products
which are commonly prepared by the farmers using cereals were replaced with small
millets to increase their utilization.

Value added products from small millet flakes - aval uppma, kitchadi, payasam,
masala flakes, boli, sweet balls, lemon bath, tamarind bath and tomato bath. Value added
products from popped small millets - uppma, bhelpoori, masala corn, cheeian.

Cookie is a small flat, baked product, commonly called biscuit. Cookie usually
prepared from wheat flour, eggs, sugar and fat, sometimes toppings with raisins, oats or
chocolate chips. Generally, wheat is one of the cereals used extensively throughout the
world for the preparation of cookie. But cookie from non-wheat cereals like rice, jowar,
maize or millet is uncommon. Recently, millets are gaining importance because they can
offer several nutraceuticals, and also being rich in protein, minerals and vitamins. Its
protein has a beneficial influence on the metabolism of cholesterol. Cereal or millet
cookie is made from a fine flour of millet with leavening and shortenings. There exists,
however considerable potential for large scale manufacture and marketing of shelf-stable
product utilizing underutilized grains like Kodo millet as the demand for ready-to-eat
convenience food products has been steadily increasing, consequent to industrialization
and convenience in using. The product is made from kodo millet flour and can be
consumed during tea time or in between the meal.

PREPARATION OF KODO MILLET COOKIES

Kodo millet cookies manufacturing process involves three steps includes

1) Mixing
2) Shaping or forming
3) Baking

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 1 Mixing
Mixing is a process designed to blend different ingredients into a uniform and
homogenous mixture. The major ingredients are flour, fat and sugar. All measured
ingredients are put together for dough formation. Prepared dough is fed into mixers where
mixing is done and dough is prepared for moulding/cutting.

2 Shaping and Forming

The forming process is specific for each cookie type. There are three processes by which
shaping or forming of cookies is achieved-
1) Sheeting and cutting
2) Rotary moulding
3) Extrusion

1) Sheeting and cutting method:

This method of forming is used for the production of crackers, semisweet cookies and
selected soft doughs.

2) Rotary moulding:

The rotary moulding process offers advantages over sheeting and cutting that there is no
scrap to recycle and very less labour requirement. This process is used for dry and
crumbly doughs only.

3) Extrusion method:

In this method of dough forming, the dough is extruded through a row of dies which is cut
by a wire or blade mounted on a frame that moves through the dough just below the die
nozzle outlet.

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 3. Baking
This is the area where we pass these moulded/ formed wet cookie into baking oven.
The cookies are baked on desired temperatures (160ºC - 220ºC).
Various type of heating are available now-a-days as per the convenience and cost.
Different types of oven are available for baking products.

4 Cooling
The hot product obtained from baking must be cooled to room temperature prior to
packaging for several reasons-
• Being warm, reduced firmness of the baked product so as to withstand packaging
process
• Packaging material shrinkage due to contact to hot product
• Hot packed product may continue release some steam causing condensation inside the
packaging.

Cooling can be achieved either by placing the baked product at ambient conditions or
by forced air cooling.

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 2. MODEL KODO MILLET COOKIES PROCESSING UNDER FME
SCHEME

2.1 LOCATION OF THE PROPOSED PROJECT AND LAND

The entrepreneur must provide description of the proposed location, site of the project, distance
from the targeted local and distant markets; and the reasons/advantages thereof i.e. in terms of
raw materials availability, market accessibility, logistics support, basic infrastructure
availability etc. The main Kodo millet growing states in India are Madhya Pradesh, Karnataka,
Maharashtra, Chhattisgarh and Tamil Nadu.

2.2 INSTALLED CAPACITY OF THE KODO MILLET COOKIES

PROCESSING UNIT

The maximum installed capacity of the Kodo millet cookies manufacturing unit in the present
model project is proposed as 150 tons/annum or 500 kg/day Kodo millet cookies. The unit is
assumed to operate 300 days/annum @ 8-10 hrs. /day the 1styear is assumed to be
construction/expansion period of the project; and in the 2nd year 55 percent capacity, 3rd year
65 percent capacity, 4th year 75 percent capacity, 5th year 90 percent capacity & 6th year
onwards 100 percent capacity utilization is assumed in this model project.

2.3 RAW MATERIAL REQUIREMENTS FOR THE UNIT

A sustainable grain processing unit must ensure maximum capacity

utilization and thus requires an operation of minimum 280-300 days per year to get reasonable
profit. Therefore, ensuring uninterrupted raw materials supply requires maintenance of
adequate raw material inventory. The processor must have linkage with producer
organizations preferably FPCs through legal contract to get adequate quantity and quality of
raw materials which otherwise get spoiled. In the Kodo millet cookies manufacturing project,

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 the unit requires 154.82 kg/day, 182.97 kg/day, 211.12 kg/day, 253.35 Kg/day & 281.5 kg/day
kodo millet grain at 55, 65, 75, 90 & 100 percent capacity utilization, respectively.

2.4 MANUFACTURING PROCESS OF THE KODO MILLET COOKIES

Flow chart for Kodo millet cookies:

Scaling of Ingredients

Creaming shortening, sugar powder, invert syrup, lecithin (5-8min)

Dissolving salt, ammonium bicarbonate, sodium bicarbonate separately in water

Adding to the above mixture and mixing (6-10 min)

Adding Kodo millet flour and mixing (7-9 min)

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 Sheeting dough (3.5 mm thickness)

Cutting into circular shape

Baking (9-11 min at 205 ° C)

Cooling and packing

2.5 MARKET DEMAND AND SUPPLY FOR KODO MILLET

COOKIES

Madhya Pradesh is one amongst the states in India with the

poorest level of nutrition: 60% of the children are underweight compared to 43% at national
level. Kodo millets provide good sources of phosphorus and iron and higher protein content
than rice. Because of this high nutritional value and their capacity to even thrive on poor
quality soils under water-limited conditions, small millets have great potential to help
alleviate nutrition insufficiencies in the State. Minor millets have largely been replaced by
rice in most parts of India.

Millet crops have recently received a lot of national and

international attention as traditional gluten-free super foods. This renewed perception
further enhances the potential for these cereals to be reasonable economic investment for
smallholder farmers in India, while improving local livelihoods, nutrition and resilience.

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 Local farmers have the opportunity to take advantage of this momentum before distant
suppliers take actions to meet the growing demand.

2.6 MARKETING STRATEGY FOR KODO MILLET COOKIES

The increasing urbanization and income offers huge scope for marketing of grains based
products. Urban organized platforms such as departmental stores, malls, super markets can
be attractive platforms to sell well packaged and branded Kodo millet products.

2.7 DETAILED PROJECT ASSUMPTIONS

This model DPR for Kodo millet cookies unit is basically prepared as a
template based on certain assumptions that may vary with capacity, location, raw materials
availability etc. An entrepreneur can use this model DPR format and modify as per
requirement and suitability. The assumptions made in preparation of this particular DPR
are given in This DPR assumes expansion of existing grain processing unit by adding new
dehydration processing line. Therefore, land and civil infrastructures are assumed as
already available with the entrepreneurs.

• Herewith in this DPR, we have considered the assumptions as listed below in the tables of
different costs, which may vary as per region, seasons and machinery designs and supplier.
1. Kodo millet cost considered @ Rs.20/-per kg.
2. 1 kg kodo millet will produce 90% recovery.
3. 1 Batch size is approximately 500 kg.
4. No. of hours per day are approximately 8-10 hours.
5. Batch yield is 95%.
Detailed Project Assumptions
Parameter Assumption
Capacity of the Kodo millet
cookies Unit 150 MT/annum

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 1st Year Implementation, 55% in
second, 65% in third, 75% in fourth
Utilization of capacity year, 90% in fifth & onwards
Working days per year 300 days
Working hours per day 10 hours
Interest on term and working
capital loan 12%
Seven year with one year grace period
Repayment period is considered.
Average prices of raw material 20
Average sale prices per Kg 180 Rs/kg
Pulp extraction 90
1 kg Kodo millet cookies from 0.563
KODO MILLET COOKIES Kg Kodo millet flour

2.8 FIXED CAPITAL INVESTMENT

2.8.1 MACHINERY AND EQUIPMENT

Price (Rs. In
Sr No. Equipment Capacity Quantity Lacs)

1 Planetary mixer 1 50 Kg/Batch 1.2

2 Cookie wire cut machine 1 Suitable 0.8

3 Rotary oven 1 100 Kg/Batch 1.5

4 wraping machine 1 Suitable 2.25

5 Weighing balance 1 Suitable 0.06

6 Accessories 1 Suitable 0.5

6.31
Total

2.8.2 OTHER COSTS:-

Utilities and Fittings:-

Utilities and Fittings

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 1.Water Rs. 0.8Lacs total
2.Power

Other Fixed Assests:

Other Fixed Assets

1. Furniture & Fixtures Rs. 0.9 lac total
2. Plastic tray capacity
3. Electrical fittings

Pre-operative expenses

Pre-operative Expenses
Legal expenses, Start-up expenses, 0.9 LAC
Establishment cost, consultancy fees,
trials and others.
Total preoperative expenses 0.9 LAC

Contingency cost to be added as approx.1.2 Lac.

So total startup cost at own land & Premise may be somewhat similar to 19.49 lacs. This is
according to survey done at X location India. This may vary on location, situation and design
change over.

2.9 WORKING CAPITAL REQUIREMENTS

Year 4
Year 2 (55%) Year 3 (65%) (75%)
Particulars Period
7 days 1.19 1.40 1.91
Raw material stock
15 days 2.37 2.80 3.82
Work in progress
15 days 0.90 1.06 1.45
Packing material
15 days 3.85 4.55 6.20
Finished goods’ stock

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 30 days 7.69 9.09 12.40
Receivables
30 days 0.81 0.96 1.31
Working expenses
16.81 19.87 27.09
Total current assets
0.00 0.00 0.00
Trade creditors
16.81 19.87 27.09
Working capital gap
4.20 4.97 6.77
Margin money (25%)
12.61 14.90 20.32
Bank finance

2.10TOTAL PROJECT COST AND MEANS OF FINANCES

Project Cost and Means of Finance

Amount
Particulars
in Lakhs
i. Land and building (20 x 32 x 12 ft -
LxBxH) 5.18
ii. Plant and machinery 6.31
iii. Utilities & Fittings 0.8
iv. Other Fixed assets 0.9
v. Pre-operative expenses 0.90
vi. Contingencies 1.20
vii. Working capital margin 4.85
Total project cost (i to vii) 20.14
Means Of finance

i. Subsidy 9.87
ii. Promoters Contribution 4.83
iii. Term Loan (@10%) 5.44

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2.11 MANPOWER REQUIREMENTS

Total Monthly Salary (Rs.) No Wages Total Monthly Total Annualy

Supervisor (can be the owner) 1 18000 18000 216000
Technician 1 14000 14000 168000
Semi-skilled 2 7600 15200 182400
Helper 1 5500 5500 66000
Sales man 1 8000 8000 96000
60700 728400

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2.12 EXPENDITURE, REVENUE AND PROFITABILITY ANALYSIS

Expenditure, Revenue and Profitability Analysis

150 MT
80.4
Particulars 1st Year 2nd Year 3rd Year 4 th Year 5th year 6th year

80.4 MT Kodo
millet
A Total Installed Capacity (MT) flour/Annum 82.5 97.5 112.5 135 150
Capacity utilization (%) Under Const. 55% 65% 75% 90% 100%
B Expenditure (Rs. in Lakh) 0
Kodo millet flour (Av. Price @ Rs. 30/Kg ) 0.00 11.96 14.13 16.30 19.57 21.74
Invert syrup @ Rs. 25/kg 0.00 0.90 1.06 1.22 1.47 1.63
Sugar @ Rs. 35/kg 0.00 5.16 6.10 7.04 8.45 9.38
Fat @ Rs. 110/kg 0.00 7.45 8.81 10.16 12.20 13.55
Essence @ Rs. 1000/Kg 0.00 0.80 0.94 1.09 1.30 1.45
Other materials 0.00 2.59 3.06 3.54 4.24 4.72
Packaging materials (Rs 12 per Kg) 0.00 9.90 11.70 13.50 16.20 18.00
Utilities (Electricity, Fuel) 0.00 0.62 0.73 0.84 1.01 1.12
Salaries (1st yr only manager’s salary) 2.16 7.28 7.28 7.28 7.28 7.28
Repair & maintenance 0.00 0.70 0.80 0.90 0.90 0.90
Insurance 0.30 0.30 0.30 0.30 0.30 0.30
Miscellaneous expenses 0.50 2.30 2.30 2.30 2.30 2.30
Total Expenditure 2.96 49.96 57.22 64.48 75.22 82.38
C Total Sales Revenue (Rs. in Lakh) 0.00 99.00 117.00 135.00 162.00 180.00
Sale of Kodo millet cookies (Av. Sale Price @
Rs.120/kg) 0.00 99.00 117.00 135.00 162.00 180.00
PBDIT (Total exp.-Total sales rev.) (Rs. in
D Lakh)/Cash Inflows -2.96 49.04 59.78 70.52 86.78 97.62
Depreciation on civil works @ 5% per annum 0.26 0.25 0.23 0.22 0.21 0.20
Depreciation on machinery @ 10% per annum 0.63 0.57 0.51 0.46 0.41 0.37
Depreciation on other fixed assets @ 15% per
annum 0.12 0.10 0.09 0.07 0.06 0.05
Interest on term loan @ 12% 0.57 0.55 0.52 0.50 0.47 0.44
Interest on working capital @ 12% 0.00 1.75 1.75 1.75 1.75 1.75
Profit after depreciation and Interest (Rs. in
E Lakh) -4.54 47.58 58.42 69.27 85.62 96.55

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 F Tax (assumed 30%) (Rs. in Lakh) 0.00 14.27 17.53 20.78 25.69 28.97
Profit after depreciation, Interest & Tax (Rs. in
G Lakh) -4.54 33.30 40.90 48.49 59.93 67.59
Surplus available for repayment (PBDIT-
H Interest on working capital-Tax) (Rs. in Lakh) 0.57 0.55 0.52 0.50 0.47 0.44
I Coverage available (Rs. in Lakh) 0.57 0.55 0.52 0.50 0.47 0.44
J Total Debt Outgo (Rs. in Lakh) 0.19 0.21 0.23 0.25 0.28 0.31
K Debt Service Coverage Ratio (DSCR) 3.00 2.62 2.28 1.97 1.69 1.44
Average DSCR 2.16
Cash accruals (PBDIT- Interest-Tax) (Rs. in
L Lakh) -3.53 34.22 41.73 49.24 60.62 68.21
M Payback Period 2.5 Years
(on Rs. 19.49 Lakhs initial investment)

2.13 REPAYMENT SCHEDULE

Ending
Year Beginning PMT Interest Principal Balance

1 5,43,771.35 75,431.52 56,552.22 18,879.30 5,24,892.05

2 5,24,892.05 75,431.52 54,588.77 20,842.74 5,04,049.31

3 5,04,049.31 75,431.52 52,421.13 23,010.39 4,81,038.92

4 4,81,038.92 75,431.52 50,028.05 25,403.47 4,55,635.45

5 4,55,635.45 75,431.52 47,386.09 28,045.43 4,27,590.02

6 4,27,590.02 75,431.52 44,469.36 30,962.16 3,96,627.86

7 3,96,627.86 75,431.52 41,249.30 34,182.22 3,62,445.65

8 3,62,445.65 75,431.52 37,694.35 37,737.17 3,24,708.48

9 3,24,708.48 75,431.52 33,769.68 41,661.84 2,83,046.64

10 2,83,046.64 75,431.52 29,436.85 45,994.67 2,37,051.97

11 2,37,051.97 75,431.52 24,653.41 50,778.11 1,86,273.86

12 1,86,273.86 75,431.52 19,372.48 56,059.04 1,30,214.83

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 13 1,30,214.83 75,431.52 13,542.34 61,889.18 68,325.65

14 68,325.65 75,431.52 7,105.87 68,325.65 0.00

10,56,041.24 5,12,269.89 5,43,771.35 (5,43,771.35)

2.14 ASSET’S DEPRECIATION

Assets’
Depreciation
(Down Value Amounts
Method) in Lakhs
1st
Particulars Year 2nd year 3 rd year 4th year 5th year 6th year 7th year 8th year

Civil works 5.18 4.92 4.67 4.44 4.22 4.01 3.81 3.62

Depreciation 0.26 0.25 0.23 0.22 0.21 0.20 0.19 0.18

Depreciated value 4.92 4.67 4.44 4.22 4.01 3.81 3.62 3.44

Plant &
Machinery 6.31 5.68 5.11 4.60 4.14 3.73 3.35 3.02

Depreciation 0.63 0.57 0.51 0.46 0.41 0.37 0.34 0.30

Depreciated value 5.68 5.11 4.60 4.14 3.73 3.35 3.02 2.72

Other Fixed
Assets 0.80 0.68 0.58 0.49 0.42 0.35 0.30 0.26

Depreciation 0.12 0.10 0.09 0.07 0.06 0.05 0.05 0.04

Depreciated value 0.68 0.58 0.49 0.42 0.35 0.30 0.26 0.22

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 All Assets 12.29 11.28 10.36 9.53 8.78 8.09 7.46 6.89

Depreciation 1.01 0.92 0.83 0.76 0.69 0.63 0.57 0.52

Depreciated value 11.28 10.36 9.53 8.78 8.09 7.46 6.89 6.37

2.15 FINANCIAL ASSESSMENT OF THE PROJECT

Benefit Cost Ratio (BCR) and Net Present Worth (NPW)

4th 5th 6th 7th 8th
Particulars 1st Year 2nd year 3 rd year year year year year year
Capital cost (Rs. in Lakh) 20.14 0.00 0.00 0.00 0.00 0.00 0.00 0.00
Recurring cost (Rs. in
Lakh) 2.96 49.96 57.22 64.48 75.22 82.38 82.38 82.38
Total cost (Rs. in Lakh) 23.10 49.96 57.22 64.48 75.22 82.38 82.38 82.38 517.11
Benefit (Rs. in Lakh) 0.00 99.00 117.00 135.00 162.00 180.00 180.00 180.00
Total Depreciated value
of all assets (Rs. in Lakh) 6.37
Total benefits (Rs. in
Lakh) 0.00 99.00 117.00 135.00 162.00 180.00 180.00 186.37 1059.37
Benefit-Cost Ratio (BCR):
(Highly Profitable
project) 2.049
Net Present Worth
(NPW): 542.26

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2.16 BREAK EVEN ANALYSIS
Break even analysis indicates costs-volume profit relations in the short run. This is the level at which, the firm is in no loss
no profit situation.

Break-Even Analysis
2nd 3 rd 4th 5th 6th 7th 8th
Sr. No. Particulars 1st Year year year year year year year year
Capacity utilization (%) Under Const. 55% 65% 75% 90% 100% 100% 100%
Production MT/Annum 82.5 97.5 112.5 135 150 150 150
A Fixed Cost (Rs. in Lakh)
Permanent staff salaries 7.284 7.284 7.284 7.284 7.284 7.284 7.284 7.284
Depreciation on building
@ 5% per annum 0.26 0.25 0.23 0.22 0.21 0.20 0.19 0.18
Depreciation on
machinery @ 10% per
annum 0.63 0.57 0.51 0.46 0.41 0.37 0.34 0.30
Depreciation on other
fixed assets @ 15% per
annum 0.12 0.10 0.09 0.07 0.06 0.05 0.05 0.04
Interest on term loan 0.57 0.55 0.52 0.50 0.47 0.44 0.41 0.38
Insurance 0.3 0.3 0.3 0.3 0.3 0.3 0.3 0.3
Total Fixed Cost (Rs. in
Lakh) 9.16 9.05 8.94 8.84 8.75 8.65 8.57 8.48
Sales Revenue (Rs. in
B Lakh) 0 99 117 135 162 180 180 180
C Variable Cost (Rs. in Lakh)
Kodo millet flour (Av.
Price @ Rs.30/Kg) 0.00 11.96 14.13 16.30 19.57 21.74 21.74 21.74
Invert syrup @ 25 per kg 0.00 0.90 1.06 1.22 1.47 1.63 1.63 1.63
Sugar @ 35 per kg 0.00 5.16 6.10 7.04 8.45 9.38 9.38 9.38
Fat @ 110 per kg 0.00 7.45 8.81 10.16 12.20 13.55 13.55 13.55
Esence @ 1000 per kg 0.00 0.80 0.94 1.09 1.30 1.45 1.45 1.45
Other ingredients 0.00 2.59 3.06 3.54 4.24 4.72 4.72 4.72
Packaging materials 0.00 9.90 11.70 13.50 16.20 18.00 18.00 18.00
Casual staff salaries 0.00 5.78 5.78 5.78 5.78 5.78 5.78 5.78
Utilities (Electricity, Fuel) 0.00 0.62 0.73 0.84 1.01 1.12 1.12 1.12
Repair & maintenance 0.00 0.70 0.80 0.90 0.90 0.90 0.90 0.90
Miscellaneous expenses 0.50 2.00 2.00 2.00 2.00 2.00 2.00 2.00
Interest on working
capital @ 12% 0.00 1.75 1.75 1.75 1.75 1.75 1.75 1.75

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 Total Variable Cost (Rs.
in Lakh) 0.50 49.61 56.87 64.12 74.86 82.02 82.02 82.02
D Break Even Point (BEP)
as % of sale - 12.00 10.00 8.00 8.00 7.00 7.00 6.00
Break Even Point (BEP) in
terms of sales value (Rs.
in Lakhs) - 11.88 11.70 10.80 12.96 12.60 12.60 10.80

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2.17 PIE CHART FOR BETTER UNDERSTANDING OF
EXPENSES OF EACH HEAD:

Amount in Lakhs (Rs.)

0.9, 9% 1.2, 12%

0.9, 9%
0.8, 8%

0.8, 8%

1.5, 15%

1.2, 12%

0.5, 5%
2.25, 22%

0.06, 0%

Planetary mixer Cookie wire cut machine Rotary oven

wraping machine Weighing balance Accessories
Contingency Water + Power Fixed Assets
Pre-operative cost

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 2.18 TYPICAL KODO MILLET COOKIES MANUFACTURING
UNIT LAYOUT

2.19 MACHINERY SUPPLIERS

There are many machinery suppliers available within India for grains based
beverage processing machineries and equipment. Some of the suppliers are:
1. Bajaj Process pack Limited, Noida, India
2. Shriyan Enterprises. Mumbai, India

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3. LIMITATIONS OF MODEL DPR & GUIDELINES FOR
ENTREPRENEURS

3.1 LIMITATIONS OF THE DPR

i. This DPR has provided only the basic standard components and methodology to
be adopted by an entrepreneur while submitting a proposal under the Formalization
of Micro Food Processing Enterprises Scheme of MoFPI.

ii. This DPR is made to provide general methodological structure not for specific
entrepreneur/crops/location. Therefore, information on the entrepreneur, forms and
structure (proprietorship/partnership/cooperative/ FPC/joint stock company) of
business, background of proposed project, location, raw material base/contract
sourcing, entrepreneur’s own SWOT analysis, market research, rationale of the
project for specific location, community advantage/benefit, employment generation
etc are not given in detail.

iii. The present DPR is based on certain assumptions on cost, prices, interest,
capacity utilization, output recovery rate and so on. However, these assumptions in
reality may vary across places, markets and situations; thus the resultant calculations
will also change accordingly.

3.2 GUIDELINES FOR THE ENTREPRENEURS

i. The success of any prospective food processing project depends on how closer
the assumptions made in the initial stage are with the reality of the targeted
market/place/situation. Therefore, the entrepreneurs must do its homework as
realistic as possible on the assumed parameters.

ii. This model DPR must be made more comprehensive by the entrepreneur by
including information on the entrepreneur, forms and structure
(proprietorship/partnership/cooperative/ FPC/joint stock company) of
entrepreneur’s business, project location, raw material costing base/contract

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 sourcing, detailed market research, comprehensive dehydrated product mix
based on demand, rationale of the project for specific location, community
advantage/benefit from the project, employment generation,
production/availability of the raw materials/crops in the targeted area/clusters
and many more relevant aspects for acceptance and approval of the competent
authority.

iii. The entrepreneur must be efficient in managing the strategic, financial,

operational, material and marketing aspects of a business. In spite of the
assumed parameter being closely realistic, a project may become unsustainable
if the entrepreneur does not possess the required efficiency in managing
different aspects of the business and respond effectively in changing situations.

iv. The machineries should be purchased after thorough market research and
satisfactory demonstration.

v. The entrepreneur must ensure uninterrupted quality raw materials’ supply and
maintain optimum inventory levels for smooth operations management.

vi. The entrepreneur must possess a strategic look to steer the business in upward
trajectory.

vii. The entrepreneur must maintain optimum (not more or less) inventory, current
assets. Selecting optimum source of finance, not too high debt-equity ratio,
proper capital budgeting and judicious utilization of surplus profit for
expansion is must.

viii. The entrepreneur must explore prospective markets through extensive

research, find innovative marketing strategy, and maintain quality, adjust
product mix to demand.

ix. The entrepreneur must provide required documents on land, financial

transaction, balance sheet, further project analysis as required by the
competent authority for approval.

x. The entrepreneur must be hopeful and remain positive in attitude while all
situations.
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 Contact Us
Director
Indian Institute of Food Processing Technology
(Ministry of Food Processing Industries, Government of India)
Pudukkottai Road, Thanjavur - 613 005, Tamil Nadu

Phone No.: +91- 4362 - 228155, Fax No.:+91 - 4362 – 227971

Email: director@iifpt.edu.in; Web: www.iifpt.edu.in

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