Goat Fattening Rs. 0.85 Million

Prime Minister's Youth Business Loan
Pre-Feasibility Study
(Goat Fattening)
Small and Medium Enterprises Development Authority

Ministry of Industries & Production
Government of Pakistan
www.smeda.org.pk
HEAD OFFICE
4th Floor, Building No. 3, Aiwan-e-Iqbal Complex, Egerton Road,
Lahore
Tel: (92 42) 111 111 456, Fax: (92 42) 36304926-7
helpdesk@smeda.org.pk
REGIONAL OFFICE REGIONAL OFFICE REGIONAL OFFICE REGIONAL OFFICE
Punjab Sindh Khyber Pakhtunkhwa Balochistan
3rd Floor, Building No. 3, 5th Floor, Bahria Ground Floor Bungalow No. 15-A
Aiwan-e-Iqbal Complex, Complex II, M.T. Khan Road, State Life Building Chaman Housing Scheme
Egerton Road Lahore, Karachi. The Mall, Peshawar. Airport Road, Quetta.
Tel: (042) 111-111-456 Tel: (021) 111-111-456 Tel: (091) 111-111-456 Tel: (081) 2831623, 2831702
Fax: (042) 36304926-7 Fax: (021) 35610572 Fax: (091) 5286908 Fax: (081) 2831922
helpdesk.punjab@smeda.org.pk helpdesk-khi@smeda.org.pk helpdesk-pew@smeda.org.pk helpdesk-qta@smeda.org.pk
Note: All SMEDA Services / information related to PM's Youth Business Loan are Free of Cost
May, 2014
Pre-Feasibility Study Goat Fattening Farm (Rs.0 .851 Million)
Table of Contents
1 DISCLAIMER .................................................................................................2
2 PURPOSE OF THE DOCUMENT ..............................................................3
3 INTRODUCTION TO SMEDA .....................................................................3
4 INTRODUCTION TO SCHEME ..................................................................3
5 EXECUTIVE SUMMARY ..............................................................................4
6 BRIEF DESCRIPTION OF PROJECT & PRODUCT ..............................4
7 CRITICAL FACTORS ...................................................................................5
8 INSTALLED & OPERATIONAL CAPACITIES ........................................5
9 GEOGRAPHICAL POTENTIAL FOR INVESTMENT .............................5
10 POTENTIAL TARGET MARKETS / CITIES.............................................5
11 GOAT FATTENING PROCESS ..................................................................5
12 PROJECT COST SUMMARY .....................................................................7
12.1 Project Economics ..................................................................................................... 7
12.2 Project Financing ....................................................................................................... 8
12.3 Project Cost ................................................................................................................ 8
12.4 Space Requirement ................................................................................................... 8
12.5 Machinery, Equipment& Furniture........................................................................... 9
12.6 Raw Material Requirements ..................................................................................... 9
12.7 Human Resource Requirement ............................................................................. 10
12.8 Revenue Generation ............................................................................................... 10
12.9 Other Costs ............................................................................................................... 10
13 CONTACTS OF SUPPLIERS AND CONSULTANTS ..........................11
14 ANNEXURE ..................................................................................................12
14.1 Income Statement .................................................................................................... 12
14.2 Balance Sheet .......................................................................................................... 13
14.3 Cash Flow Statement .............................................................................................. 14
14.4 Useful Project Management Tips .......................................................................... 15
14.5 Useful Links .............................................................................................................. 16
15 KEY ASSUMPTIONS .................................................................................17
SMEDA Services / Information related to PM’s Youth Business Loan are FREE OF COST - 1
1 DISCLAIMER
This information memorandum is to introduce the subject matter and provide a general
idea and information on the said matter. Although, the material included in this
document is based on data / information gathered from various reliable sources;
however, it is based upon certain assumptions which may differ from case to case. The
information has been provided on an ‘as is where is’ basis without any warranties or
assertions as to the correctness or soundness thereof. Although, due care and diligence
has been taken to compile this document, the contained information may vary due to
any change in any of the concerned factors, and the actual results may differ
substantially from the presented information. SMEDA, its employees or agents do not
assume any liability for any financial or other loss resulting from this memorandum in
consequence of undertaking this activity. The contained information does not preclude
any further professional advice. The prospective user of this memorandum is
encouraged to carry out additional diligence and gather any information which is
necessary for making an informed decision; including taking professional advice from a
qualified consultant / technical expert before taking any decision to act upon the
information.
For more information on services offered by SMEDA, please contact our website:
www.smeda.org.pk
2 PURPOSE OF THE DOCUMENT

The objective of the pre-feasibility study is primarily to facilitate potential entrepreneurs
in project identification for investment. The project pre-feasibility may form the basis of
an important investment decision and in order to serve this objective, the document /
study covers various aspects of project concept development, start-up, production,
marketing, finance and business management.
The purpose of this document is to facilitate potential investors in Goat Fattening Farm
by providing them with a general understanding of the business with the intention of
supporting potential investors in crucial investment decisions.
The need to come up with pre-feasibility reports for undocumented or minimally
documented sectors attains greater imminence as the research that precedes such
reports reveal certain thumb rules; best practices developed by existing enterprises by
trial and error, and certain industrial norms that become a guiding source regarding
various aspects of business set-up and it’s successful management.
Apart from carefully studying the whole document one must consider critical aspects
provided later on, which form the basis of investment decisions.
3 INTRODUCTION TO SMEDA
The Small and Medium Enterprises Development Authority (SMEDA) was established in
October 1998 with an objective to provide fresh impetus to the economy through
development of Small and Medium Enterprises (SMEs).
With a mission "to assist in employment generation and value addition to the national
income, through development of the SME sector, by helping increase the number, scale
and competitiveness of SMEs" , SMEDA has carried out ‘sectoral research’ to identify
policy, access to finance, business development services, strategic initiatives and
institutional collaboration and networking initiatives.
Preparation and dissemination of prefeasibility studies in key areas of investment has
been a hallmark of SME facilitation by SMEDA.
Concurrent to the prefeasibility studies, a broad spectrum of business development
services is also offered to the SMEs by SMEDA. These services include identification of
experts and consultants and delivery of need based capacity building programs of
different types in addition to business guidance through help desk services.
4 INTRODUCTION TO SCHEME
‘Prime Minister’s Youth Business Loan’ Scheme, for young entrepreneurs, with an
allocated budget of Rs. 5.0 Billion for the year 2013-14, is designed to provide
subsidised financing at 8% mark-up per annum for one hundred thousand (100,000)
beneficiaries, through designated financial institutions, initially through National Bank of

Pakistan (NBP) and First Women Bank Ltd. (FWBL).
Small business loans upto 2 million with tenure upto 8 years, inclusive of 1 year grace
period and a debt : equity of 90 : 10 will be disbursed to SME beneficiaries across
Pakistan, covering; Punjab, Sindh, Khyber Pakhtunkhwa, Balochistan, GilgitBaltistan,
Azad Jammu & Kashmir and Federally Administered Tribal Areas (FATA).
5 EXECUTIVE SUMMARY
The project is related to setting up goat fattening farm in which, young goats preferably
males are raised on nutritionally balanced feed or Total Mixed Ration (TMR) to get
targeted weight gain of greater value. These goats are grown in groups and each batch
stays on farm for a period of 120 days. The expected live body weight gain ranges
between 115 - 140 grams / day. Higher yields are achievable with better farm
management and better quality breeds such as Teddy for meat production.
Goats are raised in rural and semi-urban areas where there is abundance of fresh
water, fodder and natural vegetation. The fattened goats are sold normally in livestock
markets (mandies). A farm of 300 goats per annum is suggested in this pre-feasibility
study as a viable economic size to enter this business. Total estimated investment of
Rs. 0.85 million is required with fixed investment of Rs. 0.15 million and working capital
of Rs. 0.70 million. This project is proposed to be started on 90% debt and 10% equity
basis. The Internal Rate of Return (IRR), Net Present Value (NPV) & payback period of
the project are 33%, Rs.2.11 million and 3.62 years respectively. The proposed project
is a sole-proprietorship.
6 BRIEF DESCRIPTION OF PROJECT & PRODUCT
In this study, the project is based on raising 300 goats per year in a farm in three
production batches, each having 100 goats. The goats (preferably males, however,
females may also be used in case of unavailability of males) of 6-8 months of age are
fed on nutritionally balanced concentrate ration or Total Mixed Ration (TMR) as major
source of energy and protein in addition to green fodder for a period of 120 days to get
higher body weight gain. Initial live body weight of goats is around 10 kg. If these goats
are fed properly on formulated fattening feed, an additional weight, up to 15 kgs can be
achieved. The daily weight gain varies between 115 to 140 grams depending on the
quality of feed given to them. This project will provide direct employment to two people.
The proposed business may be established in rural and peri-urban areas of major cities
such as Pattoki, Sahiwal, Bahawalnagar, Rahim Yar Khan, Jehlum, MandiBahauddin,
Bahawalpur, Karachi, Sakkar, Dadu, Hyderabad, Peshawar, Charsadda, D.I. Khan,
Lasbela, QilaSaifullah, Quetta etc. the farm should be located at a place where there is
abundant availability of fodder, natural vegetation and water. Although, there is year-
round market, however, the demand increases especially before occasions like Eid-ul-
Azha. Well-fed animals are sold at a price higher than usual weight based price.
7 CRITICAL FACTORS
• Background knowledge and related experience of the entrepreneur in goat farm
operations.
• Application of good husbandry practices such as timely feeding, watering and
vaccination to ensure animal’s health and disease-free environment.
• Awareness of the supply and demand of goats in the market both for general
consumption and sacrificial purpose.
• Efficient marketing of the project and bulk supply to wholesalers.
8 INSTALLED & OPERATIONAL CAPACITIES

In this proposed study, the project will operate at 100% of its capacity from the first year
hence; the farm will start its operations with fattening of 300 goats per annum.
9 GEOGRAPHICAL POTENTIAL FOR INVESTMENT

This project is intended to be setup in rural and peri-urban areas of all the major cities
like Lahore, Faisalabad, Sargodha, Bahawalpur, Islamabad, Karachi, Hyderabad,
Sukkar, Quetta, Lasbela, Peshawar and D.I. Khan. Farm land and rural areas with
abundant water, good soil for fodder and natural vegetation for goats makes it a better
choice for goat farming; provided there is access to livestock mandies and veterinary
services.
10 POTENTIAL TARGET MARKETS / CITIES
Apart from major cities, livestock markets in all cities and peri – urban locations across
the country are the primary market in addition to specially arranged locations for larger
cities during Eid festival in the urban markets. Normally animals are sold on ‘Live Body
Weight’ basis. The price of fattened goats varies according to health of animals and
market conditions. In this feasibility, Rs. 350 per kg of live body weight is assumed as
selling price. Following are some of the target clients for goat fattening farmers;
• Livestock traders
• Butchers
• Contractors
• Slaughter house owners
11 GOAT FATTENING PROCESS

• Selection of good goat breed: There are 37 breeds of goats reported in Pakistan,
among which, important are Beetal, Dera Din Panah and Teddy in Punjab,
Barbari and Kamori in Sindh, Kaghani and Jatal in Khyber Pakhtunkhawa and
Khurassani, Lehri and Pahari in Balochistan. The availability of young stock is
not a problem as twinning, triplet kidding and early maturity are common
features of goats.
• Teddy is a meat type, small sized breed, kept for good meat production and
conformation with 52 - 55% dressing percentage. After fattening, the fat to
muscle composition is also acceptable. Such weight and composition of mutton
carcass is desirable by most of meat traders and exporters. Beetal goat is more
desirable for Eid-ul-Azha as it has higher weights and more marbling with higher
dressing percentage.
• Selection of animals with excellent body score and conditions: initial live body
weight should be around 10-12 kg at 6-8 months of age. Little emaciated
animals may also be accepted for fattening as research shows that these
animals respond positively in terms of feed efficiency.
• Housing: should be dry, comfortable and airy with proper and frequent removal
of droppings, urine and waste material (droppings can be used as bio fertilizer
for growing crops / fodder). Farm should be established on scientific lines with
adequate space allocation according to the number of goats. It should be built
east-west length wise to permit maximum day light and sun for natural
disinfection.
• A dipping bath pit of approximately 40-50 sq.ft is necessary for giving the dip of
medicines mixed water to young stock for removing external parasites.
• Feeding: Adequate weight gain can be achieved through use of balanced feed
purchased from well reputed companies or it can be formulated accordingly.
Animal should be fed TMR @ 3 % of live body weight. Additionally, salt blocks
can help in better daily weight gains. Green fodder is offered at 5% of body
weight (wet basis) to every animal.
• Watering: Daily supply of clean drinking water in clean troughs i.e. 5 to 10 liters
of water consumption / animal / day maintains the production capacity of the
animal. Due to TMR and salt offered, animal tends to consume more water.
• Disease management: Timely vaccination against infectious diseases and timely
medication for endoparasitic infestations. Following is a tentative schedule for
vaccination;
Table 1: Tentative Vaccination Schedule

Disease Vaccine Vaccination Time Duration of
Immunity
Foot and Mouth FMD Vaccine Start of spring 4 months
Disease (FMD)
Contagious Pustular CPD vaccine April-October 4 months
Dermatitis (CPD)
Anthrax Anthrax spore vaccine March-April One year
Goat Pox Goat pox vaccine March-September 4 months
Entero-toxaemia Entero-toxaemia vaccine January- July Six months
Pleuro-pneumonia Pleuro-pneumonia vaccine October-November 4 months
• Selection of good productive animals and regular culling of uneconomical
animal.
• Record keeping for each batch: The animals should be ear-tagged on arrival at
the farm. The information to be recorded includes breed of animal, initial live
weight, age, date of purchase etc. The records for regular weight gain,
medication and de-worming etc. are also important.
• Regular technical assistance from the livestock professionals and experts.
12 PROJECT COST SUMMARY
A detailed financial model has been developed to analyze the commercial viability of
goat fattening farm. Various cost and revenue related assumptions along with results of
the analysis are outlined in this section. The projected Income Statement, Cash Flow
Statement and Balance Sheet are attached as appendix.
12.1 Project Economics

The following table shows Internal Rate of Return (IRR) and payback period;
Table 2: Project Economics
Description Details
Internal Rate of Return (IRR) 33%
Payback Period (yrs) 3.62
Net Present Value (NPV) Rs. 2,111,667
12.2 Project Financing

Following table provides details of the equity required and variables related to bank
loan;
Table 3: Project Financing
Description Details
Total Equity (10%) Rs. 85,128
Bank Loan (90%) Rs.766,150
Markup to the Borrower (% / annum) 8%
Tenure of the Loan (Years) 8
Grace period (Year) 1
12.3 Project Cost

Following requirements have been identified for operations of the proposed business.
Table 4: Capital Investment for the Project
Capital Investment Amount (Rs.)
Machinery & equipment 124,000
Furniture & fixtures 5,000
Pre-operating costs 18,371
Total Capital Costs 147,371
Equipment spare part inventory 3,167
Raw material inventory (incl. cost of goats) 516,583
Upfront building rent (4 months) 37,200
Cash 146,957
Total Working Capital 703,907
Total Investment 851,278
12.4 Space Requirement

Following table shows area requirements of the proposed project;
Table 5: Space Requirement
Description Total Area (Sq. ft.)
Management building 100
Shed for animals 1,200
Store 150
Attendant’s room 100
Dipping bath 50
Open paddock 2,400

Total Infrastructure 4,000
The monthly rent of the building and infrastructure is estimated to be Rs. 9,300 per
month.
12.5 Machinery, Equipment& Furniture

Following table provides list of machinery and equipment required for Goat Fattening
Farm.
Table 6: List of Machinery, Equipment and Furniture
Description Unit Price / Unit (Rs.) Total Cost (Rs.)

Chopper 1 30,000 30,000
Water pump and tank 1 30,000 30,000
Feeding mangers 7 3,000 21,000
Tubs 2 1,500 3,000
Hand carts 2 5,000 10,000
Movable weighing scale (3'x3' 1 25,000 25,000
Platform with capacity of 200 kg)
Miscellaneous Lump sum 5,000 5,000
Furniture and fixture Lump sum 5,000 5,000
Total 129,000
12.6 Raw Material Requirements
Following table shows raw material requirements in first year of production;
Table7: Cost of Material
Description Unit Rate (Rs.) No. Total Rs.
Cost of goats Per goat 3,500 300 1,050,000
*Cost of TMR Per goat 1,515.8 300 454,747
*Cost of green fodder Per goat 202.1 300 60,633
Cost of Vaccination / Medication Per goat 150 300 45,000
Total Cost 1,610,380
*Note: Figures have been rounded off to the nearest decimal place.
12.7 Human Resource Requirement

Two semi-skilled persons (including owner of the project) are required for performing
routine farm operation and husbandry practices;
Table 8: Human Resource Requirement

Monthly Salary Annual Salary
Description No.
(Rs.) (Rs.)
Farm Manager / Owner 1 12,000 144,000
Shepherd 1 10,000 120,000
Total Staff 2 264,000
One person can handle 50 goats easily.
12.8 Revenue Generation

Table 9: Revenue Generation
First Year
Sale Price Revenue in
Description Unit Production
Rs. / Unit Year 1 (Rs.)
(Units)
Sale of fattened
Per goat 8,330 285* 2,374,050
goats
Total Revenue 2,374,050
* Out of total 300 goats,15 are lost due to mortality @ 5% per annum
12.9 Other Costs

An essential expense to be borne is electricity which is assumed to be Rs. 38,000 per
annum. The vaccination & medication cost which is assumed to be Rs. 150 per animal.
The transportation cost required for bringing the goats in farm is estimated to be Rs.
60,000 per annum. The communication charges are estimated to be 6,000 per annum.
It is assumed that Rs. 9,500 would be spent as repair and maintenance on farm per
annum.
13 CONTACTS OF SUPPLIERS AND CONSULTANTS

Table 10: Contacts of Suppliers and Consultants
Feed Suppliers
Hi-Tech Feeds (Pvt.) Ltd. ICI Pakistan Feed
1-A, ShadmanChowk Jail Road, Lahore Ph: 63-Mozang Road Lahore
042-37564503 Ph: 042-36370042
Fax 042-37564508
Anmol Vanda Big Feed (PVT) Ltd.
c/o Livestock and Dairy Development 2-A, Ahmad Block, New Garden Town, Lahore
Department, Govt. of Punjab, 16-Cooper Ph: 042-35835374-35835373
Road, Lahore
Ph: 042-99239819
Consultants
Prof. Dr. Muhammad Younas Dr. Abdul Rehman
Department of Livestock Management, Director, Directorate of Small Ruminants, Multan,
Faculty of Animal Husbandry, University of L&DD, Punjab
Agriculture, Faisalabad, Pakistan Ph: 061-9210417
Ph: 041-9200161-170
Livestock and Dairy Development Dr. M. Abdullah
Department, Govt. of Punjab, Dean, Faculty of Animal Production and
16-Cooper Road, Lahore. Technology, University of Veterinary and Animal
Toll free No.: 0800-78685, 0800-78686 Sciences, Lahore
Ph: 042-9211398
Livestock Mandies
The animals may be procured from local goat breeders and livestock mandies scheduled in
different districts such as Pattoki, Okara, Bahawalnagar, Lodhran, Vehari, Khanewal, Arifwala,
Pakpattan etc. as per scheduled by Livestock and Dairy Development Department, Govt. of The
Punjab Lahore. Free Landline: 0800-78685, 0800-78686
Meat Contractors/ Processors
Mr. YounasQureshi Punjab Agriculture and Meat Company
Chairman (PAMCO)
Red Cow Meat Products of Pakistan 5/8 Shaheen Complex, Egerton Road Lahore
125/ 13-B-1, Township, Lahore Ph: 042-36370661
Ph: 042-35112603
14 ANNEXURE
14.1 Income Statement

Statement Summaries SMEDA
Income Statement
Rs. in actuals
Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10
Revenue 2,374,050 2,611,455 2,872,601 3,159,861 3,475,847 3,823,431 4,205,774 4,626,352 5,088,987 5,597,886
Cost of Goods Sold
Feed & Vaccination Cost 499,747 549,722 604,694 665,164 731,680 804,848 885,333 973,866 1,071,253 1,178,378
Cost of Goat 1,050,000 1,155,000 1,270,500 1,397,550 1,537,305 1,691,036 1,860,139 2,046,153 2,250,768 2,475,845
Direct Labor 264,000 290,400 319,440 351,384 386,522 425,175 467,692 514,461 565,907 622,498
Repair & Maintenance 9,500 10,450 11,495 12,645 13,909 15,300 16,830 18,513 20,364 22,401
Utilities 38,000 41,800 45,980 50,578 55,636 61,199 67,319 74,051 81,456 89,602
Total Cost of Sales 1,921,248 2,113,372 2,324,709 2,557,180 2,812,898 3,094,188 3,403,607 3,743,968 4,118,365 4,530,201
Gross Profit 452,803 498,083 547,891 602,680 662,948 729,243 802,167 882,384 970,622 1,067,685
General administration & selling expenses

Administration expense - - - - - - - - - -
Rental expense 111,600 122,760 135,036 148,540 163,394 179,733 197,706 217,477 239,225 263,147
Utilities expense - - - - - - - - - -
Travelling & Comm. expense (phone, fax, etc.) 6,000 6,600 7,260 7,986 8,785 9,663 10,629 11,692 12,862 14,148
Office vehicles running expense - - - - - - - - - -
Office expenses (stationary, etc.) - - - - - - - - - -
Promotional expense - - - - - - - - - -
Insurance expense - - - - - - - - - -
Professional fees (legal, audit, etc.) - - - - - - - - - -
Depreciation expense 12,900 12,900 12,900 12,900 12,900 12,900 12,900 12,900 12,900 12,900
Amortization expense 3,674 3,674 3,674 3,674 3,674 - - - - -
Property tax expense - - - - - - - - - -
Miscellaneous expense - - - - - - - - - -
Subtotal 134,174 145,934 158,870 173,100 188,752 202,296 221,236 242,069 264,986 290,195
Operating Income 318,628 352,149 389,021 429,580 474,196 526,947 580,932 640,315 705,636 777,490
Other income - - - - - - - - - -
Gain / (loss) on sale of assets - - - - - - - - - -
Earnings Before Interest & Taxes 318,628 352,149 389,021 429,580 474,196 526,947 580,932 640,315 705,636 777,490
Interest expense 63,372 58,497 51,454 43,828 35,571 26,631 16,952 6,472 - -
Earnings Before Tax 255,257 293,651 337,567 385,752 438,625 500,316 563,980 633,843 705,636 777,490
Tax - - - - 3,862 10,032 16,398 23,384 30,564 39,123

NET PROFIT/(LOSS) AFTER TAX 255,257 293,651 337,567 385,752 434,762 490,284 547,582 610,458 675,073 738,367
Balance brought forward 255,257 548,908 886,474 1,272,227 1,706,989 2,197,273 2,744,855 3,355,313 4,030,386
Total profit available for appropriation 255,257 548,908 886,474 1,272,227 1,706,989 2,197,273 2,744,855 3,355,313 4,030,386 4,768,752
Dividend - - - - - - - - - -
Balance carried forward 255,257 548,908 886,474 1,272,227 1,706,989 2,197,273 2,744,855 3,355,313 4,030,386 4,768,752
14.2 Balance Sheet

Balance Sheet
Rs. in actuals
Year 0 Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10
Assets
Current assets
Cash & Bank 146,957 306,095 395,244 493,203 597,816 702,212 800,001 885,564 951,187 1,131,158 4,853,880
Accounts receivable - - - - - - - - - - -
Finished goods inventory - - - - - - - - - - -
Equipment spare part inventory 3,167 3,658 4,224 4,879 5,635 6,509 7,518 8,683 10,029 11,584 -
Raw material inventory 516,583 625,065 756,328 915,157 1,107,340 1,339,882 1,621,257 1,961,721 2,373,683 2,872,156 -
Pre-paid annual land lease - - - - - - - - - - -
Pre-paid building rent 37,200 40,920 45,012 49,513 54,465 59,911 65,902 72,492 79,742 87,716 -
Pre-paid lease interest - - - - - - - - - - -
Pre-paid insurance - - - - - - - - - - -
Total Current Assets 703,906 975,737 1,200,809 1,462,753 1,765,257 2,108,513 2,494,678 2,928,461 3,414,641 4,102,613 4,853,880
Fixed assets
Land - - - - - - - - - - -
Building/Infrastructure - - - - - - - - - - -
Machinery & equipment 124,000 111,600 99,200 86,800 74,400 62,000 49,600 37,200 24,800 12,400 -
Furniture & fixtures 5,000 4,500 4,000 3,500 3,000 2,500 2,000 1,500 1,000 500 -
Office vehicles - - - - - - - - - - -
Office equipment - - - - - - - - - - -
Total Fixed Assets 129,000 116,100 103,200 90,300 77,400 64,500 51,600 38,700 25,800 12,900 -
Intangible assets
Pre-operation costs 18,371 14,697 11,023 7,348 3,674 - - - - - -
Legal, licensing, & training costs - - - - - - - - - - -
Total Intangible Assets 18,371 14,697 11,023 7,348 3,674 - - - - - -
TOTAL ASSETS 851,278 1,106,534 1,315,032 1,560,402 1,846,331 2,173,013 2,546,278 2,967,161 3,440,441 4,115,513 4,853,880
Liabilities & Shareholders' Equity

Current liabilities
Accounts payable - - - - - - - - - - -
Export re-finance facility - - - - - - - - - - -
Short term debt - - - - - - - - - - -
Other liabilities - - - - - - - - - - -
Total Current Liabilities - - - - - - - - - - -
Other liabilities
Lease payable - - - - - - - - - - -
Deferred tax - - - - - - - - - - -
Long term debt 766,150 766,150 680,996 588,799 488,977 380,897 263,877 137,179 - - -
Total Long Term Liabilities 766,150 766,150 680,996 588,799 488,977 380,897 263,877 137,179 - - -
Shareholders' equity
Paid-up capital 85,128 85,128 85,128 85,128 85,128 85,128 85,128 85,128 85,128 85,128 85,128
Retained earnings - 255,257 548,908 886,474 1,272,227 1,706,989 2,197,273 2,744,855 3,355,313 4,030,386 4,768,752
Total Equity 85,128 340,384 634,035 971,602 1,357,355 1,792,117 2,282,401 2,829,982 3,440,441 4,115,513 4,853,880
TOTAL CAPITAL AND LIABILITI 851,278 1,106,534 1,315,032 1,560,402 1,846,331 2,173,013 2,546,278 2,967,161 3,440,441 4,115,513 4,853,880
Note: Total assets value will differ from project cost due to first installment of leases paid at the start of year 0
- - - - - - - - - - -
14.3 Cash Flow Statement

- - - - - - - - - - -

Cash Flow Statement
Rs. in actuals
Year 0 Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10
Operating activities
Net profit - 255,257 293,651 337,567 385,752 434,762 490,284 547,582 610,458 675,073 738,367
Add: depreciation expense - 12,900 12,900 12,900 12,900 12,900 12,900 12,900 12,900 12,900 12,900
amortization expense - 3,674 3,674 3,674 3,674 3,674 - - - - -
Deferred income tax - - - - - - - - - - -
Accounts receivable - - - - - - - - - - -
Finished good inventory - - - - - - - - - - -
Equipment inventory (3,167) (491) (567) (655) (756) (873) (1,009) (1,165) (1,346) (1,554) 11,584
Raw material inventory (516,583) (108,482) (131,264) (158,829) (192,183) (232,541) (281,375) (340,464) (411,961) (498,473) 2,872,156
Pre-paid building rent (37,200) (3,720) (4,092) (4,501) (4,951) (5,446) (5,991) (6,590) (7,249) (7,974) 87,716
Pre-paid lease interest - - - - - - - - - - -
Advance insurance premium - - - - - - - - - - -
Accounts payable - - - - - - - - - - -
Other liabilities - - - - - - - - - - -
Cash provided by operations (556,949) 159,138 174,303 190,156 204,436 212,475 214,809 212,262 202,802 179,971 3,722,722
Financing activities
Change in long term debt 766,150 - (85,153) (92,197) (99,823) (108,080) (117,020) (126,699) (137,179) - -
Change in short term debt - - - - - - - - - - -
Issuance of shares 85,128 - - - - - - - - - -
Purchase of (treasury) shares - - - - - - - - - - -
Cash provided by / (used for) financ 851,278 - (85,153) (92,197) (99,823) (108,080) (117,020) (126,699) (137,179) - -
Investing activities
Capital expenditure (147,371) - - - - - - - - - -
Acquisitions - - - - - - - - - - -
Cash (used for) / provided by invest (147,371) - - - - - - - - - -
NET CASH 146,957 159,138 89,149 97,959 104,613 104,395 97,789 85,563 65,623 179,971 3,722,722
Cash balance brought forward 146,957 306,095 395,244 493,203 597,816 702,212 800,001 885,564 951,187 1,131,158
Cash available for appropriation 146,957 306,095 395,244 493,203 597,816 702,212 800,001 885,564 951,187 1,131,158 4,853,880
Dividend - - - - - - - - - - -
Cash carried forward 146,957 306,095 395,244 493,203 597,816 702,212 800,001 885,564 951,187 1,131,158 4,853,880
Pre-Feasibility Study Goat Fattening Farm (Rs.0 .851 Million
14.4 Useful Project Management Tips
Technology
• Animal Selection: Selection of disease free animals with good breed
characteristics, body conditions and health.
• Feed, Vaccination and Medication: Should be procured from reputed and
reliable sources.
• Energy Requirement: Should not be overestimated or installed in excess and
alternate source of energy for critical operations be arranged in advance.
• Machinery Suppliers: Should be asked for after sales services under the
contract with the machinery suppliers.
• Quality Assurance & Standards: Quality standards need to be defined on the
ear tags and a system of record keeping should be developed to check them.
Marketing
• Product Development: Expert's help may be engaged for marketing of each
batch of animal.
• Ads & P.O.S. Promotion: Business promotion and dissemination through
banners and launch events is highly recommended. Product brochures from
good quality service providers.
• Sales & Distribution Network: Expert's advise and distribution agreements
are required.
• Price - Bulk Discounts, Cost plus Introductory Discounts: Price should
never be allowed to compromise quality. Price during introductory phase may
be lower and used as promotional tool. Product cost estimates should be
carefully documented before price setting. Government controlled prices shall
be displayed.
Human Resources
• Adequacy & Competencies: Skilled and experienced staff should be hired
for the project.
• Performance Based Remuneration: Employees should be paid and
rewarded keeping in view their performance.
• Training & Skill Development: Encouraging training and skill of self &
employees through experts and exposure of best practices can be asset for
business. Least cost options for Training and Skill Development (T&SD) may
be linked with compensation benefits and awards.
14.5 Useful Links

• Prime Minister’s Office, www.pmo.gov.pk
• Government of Pakistan, www.pakistan.gov.pk
• Ministry of Industries & Production, www.moip.gov.pk
• Ministry of National Food Security & Research, www.mnfsr.gov.pk
• Ministry of Education, Training & Standards in Higher Education,
www.moptt.gov.pk
• Government of Punjab, www.punjab.gov.pk
• Government of Sindh, www.sindh.gov.pk
• Government of Khyber Pakhtunkhwa, www.khyberpakhtunkhwa.gov.pk
• Government of Balochistan, www.balochistan.gov.pk
• Government of GilgitBaltistan, www.gilgitbaltistan.gov.pk
• Government of Azad Jamu Kashmir, www.ajk.gov.pk
• Trade Development Authority of Pakistan (TDAP), www.tdap.gov.pk
• Security Commission of Pakistan (SECP), www.secp.gov.pk
• Federation of Pakistan Chambers of Commerce and Industry (FPCCI)
• www.fpcci.com.pk
• Punjab Board of Investment & Trade (PBIT), 23-Aikman Road, GOR-I, Lahore
Tel. 042-99205201, www.pbit.gop.pk
• State Bank of Pakistan (SBP), www.sbp.org.pk
• National Bank of Pakistan (NBP), www.nbp.com.pk
• First Women Bank Limited (FWBL), www.fwbl.com.pk
• All Pakistan Meat Exporters and Processors Association, Lahore,
www.apmepa.com
• Punjab Agriculture and Meat Company (PAMCO), Lahore, www.pamco.bz
• Pakistan Agricultural Research Council (PARC), Islamabad, Tel. 051-9203966
www.parc.gov.pk
• University of Agriculture, Faisalabad, www.uaf.edu.pk
• University of Veterinary & Animal Sciences (UVAS), Out Fall Road, Lahore,
www.uvas.edu.pk
• Veterinary Research Institute (VRI), Ghazi Road, Lahore Cantt., Tel. 042-
99220140
• Agribusiness Support Fund (ASF), Lahore, www.asf.org.pk
• Directorate of Livestock Farms, L&DD, Lahore, Tel: 042-99201126-7
• Livestock Experiment Station (LES), DeraChahl Lahore, L&DD, Punjab, Tel: 042-
99239818, 99239819
• Directorate of Livestock Training Centre (LSTC), Bahadurnagar, Okara, Tel: 044-
2661393
15 KEY ASSUMPTIONS
Table 11: Project Assumptions
Installed Capacity (No. of goats per batch) 100
No. of batches / year 3
Annual Installed Capacity (No. of goats) 300
Initial Capacity (%) 100
initial Capacity per year (No. of goats) 300
Maximum Capacity % 100
Initial weight of young goat (kg) 10
Purchase Price Rs./ kg (live body weight) 350
Weight Gain (grams/ day) 115
Feeding Days 120
Feed/ TMR offered per animal 3 % of live body weight
Price of TMR (Rs/ kg) 25
Green fodder offered/ animal 5 % of live body weight
Price of green fodder Rs/kg 2
Live body weight (kgs/ animal) at selling time 25
Selling Price (Rs. / kg live body weight) 350
Purchase Price / kg (live) 3,500
Sale Price per animal in Yr-1 8,330
Space required (Covered Area/ animal) Sq. ft 12
Open space / animal (Sq. ft.) 24

Goat Fattening Rs. 0.85 Million

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Goat Fattening Rs. 0.85 Million

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Prime Minister's Youth Business Loan

Small and Medium Enterprises Development Authority

2 PURPOSE OF THE DOCUMENT

beneficiaries, through designated financial institutions, initially through National Bank of

8 INSTALLED & OPERATIONAL CAPACITIES

9 GEOGRAPHICAL POTENTIAL FOR INVESTMENT

11 GOAT FATTENING PROCESS

Table 1: Tentative Vaccination Schedule

12.1 Project Economics

Table 2: Project Economics

12.2 Project Financing

12.3 Project Cost

12.4 Space Requirement

Open paddock 2,400

12.5 Machinery, Equipment& Furniture

Description Unit Price / Unit (Rs.) Total Cost (Rs.)

12.7 Human Resource Requirement

Table 8: Human Resource Requirement

12.8 Revenue Generation

Total Revenue 2,374,050

12.9 Other Costs

13 CONTACTS OF SUPPLIERS AND CONSULTANTS

14.1 Income Statement

General administration & selling expenses

Tax - - - - 3,862 10,032 16,398 23,384 30,564 39,123

14.2 Balance Sheet

Statement Summaries SMEDA

Liabilities & Shareholders' Equity

14.3 Cash Flow Statement

Statement Summaries SMEDA

14.4 Useful Project Management Tips

14.5 Useful Links

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