10 Crossbred Cow Farm

Assumptions

  1. The cost of land for the project is not considered.
  2. Inter-calving period of 390 days (300 lactating days and 90 dry days)
  3. Provision for silage bunker & mister set
  4. Change in market price of the animals assumed in following manner
    1. Animals in 1st lactation: No change
    2. Animals in 2nd lactation: +5%
    3. Animals in 3rd lactation: -5%
    4. Animals in 4th lactation: -10%
    5. Animals in 5th lactation: -30%
    6. Animals in 6th lactation: -50%
    7. Animals in 7th lactation: -70%
  5. Once the young animal, reared within the herd that is ready to calve, would replace the oldest animal.
  6. The animals apart from 1st, 2nd or 3rd lactations are assumed to be sold off to maintain constant herd size.
  7. Required land is available for cultivating green fodder for animals.
  8. For lactating animals, total dry matter of feed and fodder is assumed to be in the range of 3.5-4 kg per 100 kg body weight.
  9. For dry animals, total dry matter of feed and fodder is assumed to be around 2.5 kg per 100 kg body weight.
  10. The project is considered as on-going and therefore, terminal values of assets are not considered.
  11. Male calves are assumed to be sold off.
  12. Price assumptions are on average basis and would vary region to region
  13. Provision for any taxation has not been made
  14. Of total 10 cows purchased
  • 5 cows are of 1st lactation having yield of 15 litres/ day, costing ₹ 60,000/ animal
  • 3 cows are of 2nd lactation having yield of 18 litres/ day, costing ₹ 63,000/ animal
  • 2 cows are of 3rd lactation having yield of 17 litres/ day, costing ₹ 60,000/ animal
  1. Of 10 animals, 5 are assumed to be purchased at the beginning of the project and rest after 6 months
  2. Provision for manual chaff cutter
  3. No milking machine
PROJECT DETAILS (INDICATIVE) for 10 COW FARM
Pre-requisite for the project       square feet        
Land requirement for cattle shed, storage and silage bunker 2325        
                 
Project cost                
Item Amount (₹)              
Cattle shed for adult animals 420,000              
Cattle shed for calves 140,000              
Cattle shed for heifers 245,000              
Silage bunker 37,500              
Construction for storage area 233,340              
Animals 623,000              
Equipments 16,000              
Contigency 34,300              
Total Project cost 1,749,140              
                 
Fixed cost (₹)                
Item Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7  
Depreciation of cattleshed 103,834 103,834 103,834 103,834 103,834 103,834 103,834  
Depreciation of equipment 1,600 1,600 1,600 1,600 1,600 1,600 1,600  
Relative change in value of herd -9,000 -63,000 -15,000 18,000 72,000 0 0  
Interest on capital investment 209,897 209,897 209,897 209,897 209,897 209,897 209,897  
Total fixed cost 306,331 252,331 300,331 333,331 387,331 315,331 315,331  
                 
Variable cost (₹)                
Item Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7  
Green fodder cultivation 48,000 48,000 48,000 48,000 48,000 48,000 48,000  
Green fodder cost 0 0 0 0 0 0 0  
Dry fodder cost 143,904 210,240 245,280 280,320 280,320 280,320 280,320  
Concentrate cost 171,976 240,576 261,016 281,456 281,456 281,456 281,456  
Mineral mixture cost 15,282 21,564 23,754 25,944 25,944 25,944 25,944  
Labour charges 60,000 60,000 60,000 60,000 60,000 60,000 60,000  
Insurance charges 24,120 24,120 24,120 24,120 24,120 24,120 24,120  
Veterinary & breeding expenses 15,000 15,000 15,000 15,000 15,000 15,000 15,000  
Electricity & water charges 15,000 15,000 15,000 15,000 15,000 15,000 15,000  
Transportation cost for milk sale 1,000 1,000 1,000 1,000 1,000 1,000 1,000  
Minor repair of building/ equipments 5,000 5,000 5,000 5,000 5,000 5,000 5,000  
Interest on working capital 6,866 7,331 7,520 7,710 7,710 7,710 7,710  
Total variable cost 506,148 647,831 705,690 763,550 763,550 763,550 763,550  
                 
Income (₹)                
Item Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7  
Milk 854,120 1,200,420 1,109,160 1,031,940 1,067,040 1,165,320 1,165,320  
Gunny bags 2,460 3,440 3,730 4,020 4,020 4,020 4,020  
Sale of animals 2,000 2,000 2,000 62,000 134,000 122,000 224,000  
Sale of dung/ manure 12,600 16,800 16,800 16,800 16,800 16,800 16,800  
Total receipt 871,180 1,222,660 1,131,690 1,114,760 1,221,860 1,308,140 1,410,140  
                 
PBDIT (Operating Profit) (₹) 365,032 574,829 426,000 351,210 458,310 544,590 646,590  
Net Profit (₹) 58,701 322,498 125,669 17,879 70,979 229,259 331,259  
                 
IRR 18.4%              
ROI 21.9%