FEASIBILITY STUDY REPORT

ON

Hemer Footwear Ltd

Factory Address
Sreepur, Gazipur

Corporate Office
Head office- House # 31, Suit # 03, Road # 29, Sector # 07, Uttara, Dhaka, Bangladesh
Abbreviations
 Hemer Footwear Ltd
Table of Contents

Contents Page No.

 Hemer Footwear Ltd
Table of Contents

Contents Page No.

 Hemer Footwear Ltd
PROJECT SUMMARY

1.01 Name of the project : Hemer Footwear Ltd

1.02 Location of the project : Islampur(Major Tila), Shahporan, Sylhet

1.03 Registration No & Date :

1.04 Corporate Address : Head office- Sadharan Bima Bhaban, Level-7, 24-25, Dilkhusa B/A, Motijheel, Dhaka-1000

1.05 Details of Land : a) Area of Land : 27.39 acre

b) Located : Village/Holding No: Islampur, Post office: Islampur, Thana: Shahaparan,
District: Sylhet,
c) Encumbrance : The project land is taken from Bangladesh Textile Mills Corporation
(BTMC) on a 30 years lease, which may be extended on the basis of
satisfactory performance of the first Lease.

1.06 Nature of project & : The objective of this project is to cater the huge demand of high quality luxurious shoes
Production at 100% for the export market, also will give an opportunity to the local investors for economic
Capacity Utilization development of the country.the project will produce 600 pairs of shoes, 850 pairs of
phylon outsole and 780 pairs of TPR outsole daily.

1.07 Legal status : Private Limited Company

1.08 TIN :

1.09 BIN :

1.08 Project Capital : a) Authorized Capital Tk ( shares @ Tk. each)

b) Paid up Capital Tk ( shares @ Tk. each)

1.09 Annual Production Capacity (Kgs)

Utilized Production Capacity (kg)

Prod Cap at
Particulars Yr. -01 Yr. -02 Yr. -03 Yr. -04
100%
80% 85% 90% 95%
Sports shoes 201,600 161,280 171,360 181,440 191,520
Phylon outsole 285,600 228,480 242,760 257,040 271,320
TPR outsole 262,080 209,664 222,768 235,872 248,976
Total 749,280 599,424 636,888 674,352 711,816

1.1 Land & Location The project is proposed to be located at Village/Holding No: Islampur, Post
office: Islampur, Thana: Shahaparan, District: Sylhet on a plot of land measuring
about 27.39 acre on 30 years lease.

1.11 Building and other Civil Works Building & Civil Construction of the project consist of Pre-fabricated Steel
Structured factory Shed of 34,000 sft where the shoes factory/ plant will be
located One RCC Structured 3 Storied Building of 4750 sft will be used as Service
Bay building. In addition, there will be Raw Cotton Godown, Finished Goods
godown. One 2 Storied Administrative Building and drainage, water tanks,
sewerage tanks, sanitary system, canal retaining wall, canal bridge, Road,
Security Buidling, Boundary wall with Gate etc. Total cost of building along with
civil structure has been estimated at BDT 1.3 Crore.

1.12 Machinery and equipment's The project will be designed with machinery & Equipments from japanese,
Chinies and European sources with modern & state of art technologies. The cost
of the imported machinery will be BDT 16.4 Crore whilst Local Machinery &
equipment will be BDT 1.68 Crore and Clearing & Forwarding cost for the
imported Machinery & Equipment will be BDT 479 Crore. The cost of erection
and installation has been estimated to BDT .472 Crore.
Page 5
1.13 Furniture & fixture For procurement of factory and office furniture, fixture and other assets .52
crore will be required.

1.14 Transportation The Project will procure 1 new covered van (1.5 tons) for carrying Raw Materials
and Finished Goods and 1 cars and 1 Micro-Bus for official purposes for the said
required fund will be BDT .85 Crore.

1.15 Water Water for the Project's will be meet up by submersible pump and WTP of the
project.

1.16 Fuel and lubricants Grease, Lubricating oil, Petrol, Diesel, Mobil, Transformer oil, Kerosene,
Detergent/Soap.
1.17 Financial aspects
Assumptions : i) Rate of interest - %13%
on local
onfinance
local finance
ii) Construction Period: 1.75 Year
iii) Repayment period: Local fund will be repaid within 10 years (with quarterly
repayment installment).
1.18 Cost of the Project BDT 28.6 Crore exclusive of IDCP & Working Capital.

Items Amount
Land and Land development 54,432,000
Building & Civil Construction 13,387,900
Machinery cost-Foreign 159,866,520
Machinery cost-Local 16,886,000
C&F for Importable Machinery 4,795,996
Machinery Erection & Installation 4,721,250
Furniture, Fixture & Office Equipments 5,268,000
Transport & Vehicles 8,560,000
Security Deposit 15,500,000
Preliminary & Pre-operating Expenses 2,600,000
Total Fixed Cost 286,017,666
Interest During Construction Period(IDCP) 39,052,459
Net Working Capital (funded) 30,376,937
Total Project Cost 355,447,062

Project Cost Graphical Presentation

15,500,000 Land and Land development
5,268,000
8,560,000 2,600,000 Building & Civil Construction
4,721,250
4,795,996 Machinery cost-Foreign
54,432,000
16,886,000 Machinery cost-Local
13,387,900
C&F for Importable Machinery

Machinery Erection & Installation

Furniture, Fixture & Office Equipments

159,866,520 Transport & Vehicles

Security Deposit

Preliminary & Pre-operating Expenses

Means of Finance
The estimated fixed cost is proposed to be financed as under:
Particulars Amount
Fixed Investment 286,017,666
IDCP 39,052,459
Total Fixed Investment (including IDCP) 325,070,125
Page 6
 Debt Contribution 210,711,618
Equity Contribution 114,358,507
Debt-Equity Ratio 65:35
Debt to be contributed by Local Sources 210,711,618

Initial Working Capital Requirements (Funded) 30,376,937

Debt Contribution 24,301,550
Equity Contribution 6,075,387
Debt-Equity Ratio 80:20
-
Total Initial Investment Volume 355,447,062
Debt Contribution 235,013,168
Equity Contribution 120,433,894
Debt-Equity Ratio 66:34

1.19 Debt Equity Ratio 65%-35%

1.20 Payback Period 5.42 Years

1.21 Internal Rate of Return (IRR) of the Project 21.40%

1.22 Break Even Sales The project is expected to break even at 58.97% of the capacity utilization at a sales
value of BDT 170.36 million.

1.23 Debt – Service Coverage Ratio 4.43 times in 3rd year

1.24 Profitability
0
Particulars Year - 01 Year - 02 Year - 03 Year - 04 Year - 05
Capacity Utilization 80% 85% 90% 95% 95%
Turnover 235,105,896 273,443,462 291,759,432 308,257,109 309,897,956
Sales Revenue 232,778,115 270,736,101 288,870,725 305,205,059 306,829,659
Cash Incentive 2,327,781 2,707,361 2,888,707 3,052,051 3,068,297
Cost of Goods Sold 162,625,390 189,246,226 199,305,919 209,220,687 211,409,398
Gross Income 72,480,506 84,197,236 92,453,513 99,036,422 98,488,557
Administrative Overhead 7,632,000 7,826,462 8,025,666 8,229,800 8,438,958
Operating Income 64,848,506 76,370,774 84,427,846 90,806,622 90,049,600
Financial Expenses 8,707,059 27,593,463 24,756,551 21,919,031 18,976,647
Income before Tax 56,141,446 48,777,312 59,671,295 68,887,592 71,072,953
Income Tax 6,736,974 5,853,277 7,160,555 8,266,511 8,528,754
Net profit after Tax 49,404,473 42,924,034 52,510,740 60,621,081 62,544,198
Add: Other Income - - - - -
Net profit 49,404,473 42,924,034 52,510,740 60,621,081 62,544,198
Opening Balance of Retained Earning - 49,404,473 92,328,507 144,839,247 205,460,328
Closing Balance of Retained Earning 49,404,473 92,328,507 144,839,247 205,460,328 268,004,526

Ratios
Graphical Presentation of Profit Ratios
35.00% Particulars Year - 01 Year - 02 Year - 03 Year - 04 Year - 05
30.00% Gross profit ratio 31.14% 32.45% 32.01% 32.45% 32.10%
Operating profit ratio 27.86% 29.75% 29.23% 29.75% 29.35%
25.00%
Net profit before tax ratio 24.12% 22.57% 20.66% 22.57% 23.16%
20.00% Net profit after tax ratio 21.22% 19.86% 18.18% 19.86% 20.38%
15.00%
Particulars Year - 01 Year - 02 Year - 03 Year - 04 Year - 05
10.00%
Gross profit ratio ## ## ## ## ##
5.00% Operating profit ratio ## ## ## ## ##
0.00% Net profit before tax ratio ## ## ## ## ##
Net profitYear
after
- 01 tax ratio ##
Year - 02 ## Year - 03 ## ##Year - 04 ## Year - 05

Gross profit ratio Operating profit ratio Net profit before tax ratio Net profit after tax ratio

1.25 Employment generation 173 Persons of various categories.

Page 7
1.26 Conclusion The Project is found to be technically feasible, socially and

economically desirable, financially rewarding and commercially viable

and it may, therefore, be considered suitable for bank financing.

Page 8
 Hemer Footwear Ltd
RATIO ANALYSIS

Particulars Year-1 Year-2 Year-3 Year-4 Year-5

6.01 Liquidity Analysis Ratios
Liquidity ratios are some of the most widely used ratios, perhaps next to profitability ratios. They are especially
important to creditors. These ratios measure Hemer Footwear Ltd’s ability to meet its short-term obligations.

6.01.1 Current Ratio

The current ratio measures Hemer Footwear Ltd 's current assets against its current liabilities. The current ratio

indicates if Hemer Footwear Ltd can pay off its short-term liabilities in an emergency by liquidating its current assets.

Current Assets 118,573,624 158,477,191 206,543,683 262,709,617 318,475,241

Current Liabilities 37,757,744 41,286,759 43,677,098 46,059,075 46,450,168
3.14 3.84 4.73 5.70 6.86
6.01.2 Quick Ratio
The quick ratio is a liquidity ratio that is more stringent than the current ratio. This ratio compares the cash, short-term
marketable securities and accounts receivable to current liabilities. The thought behind the quick ratio is that certain
line items, such as prepaid expenses, have already been paid out for future use and cannot be quickly and easily
converted back to cash for liquidity purposes.

Quick Assets 74,740,493 110,415,822 155,677,857 209,050,233 264,345,726

Current Liabilities 37,757,744 41,286,759 43,677,098 46,059,075 46,450,168
Quick Assets = 1.98 2.67 3.56 4.54 5.69
Cash + Short-term Marketable Securities + Accounts Receivable

6.01.3 Net Working Capital Ratio

Net working capital to total asset ratio shows Hemer Footwear Ltd’s ability to match its account payable obligations on
time. Suppliers prefer to strike relationships with such companies, who would make payments on time. The reason for a
high working capital-total assets ratio, could be Hemer Footwear Ltd realizing revenue from sales much quicker than it
makes payments for raw materials and other services. The reason could, however, also be Hemer Footwear Ltd not
utilizing its cash reserves optimally.

Net Working Capital 80,815,881 117,190,432 162,866,585 216,650,542 272,025,074

Total Assets 412,612,820 436,985,457 469,521,020 510,156,025 550,390,720
0.20 0.27 0.35 0.42 0.49

6.01.4 Cash Ratio

The most conservative liquidity ratio is the cash ratio, which is calculated as simply cash and short-term marketable
securities divided by current liabilities. Cash and short-term marketable securities represent the most liquid assets of
Hemer Footwear Ltd .

Cash + Short-term Marketable Securities

59,240,493 94,915,822 140,177,857 193,550,233 248,845,726
Current Liabilities 37,757,744 41,286,759 43,677,098 46,059,075 46,450,168
1.57 2.30 3.21 4.20 5.36

Page 9
6.02 Profitability Analysis Ratios
Profitability ratios are arguably the most widely used ratios in investment analysis. These ratios include the ubiquitous
“margin” ratios, such as gross, operating and net profit margins. These ratios measure Hemer Footwear Ltd’s ability to
earn an adequate return. When analyzing Hemer Footwear Ltd’s margins, it is always prudent to compare them against
those of the industry and Hemer Footwear Ltd's close competitors.

6.02.1 Gross Profit Margin

Gross profit margin is simply gross income (revenue less cost of goods sold) divided by net revenue. The ratio reflects
pricing decisions and product costs.

Gross Profit 72,480,506 84,197,236 92,453,513 99,036,422 98,488,557

X 100
Sales Revenue 232,778,115 270,736,101 288,870,725 305,205,059 306,829,659
31% 31% 32% 32% 32%
6.02.2 Operating Profit Margin
Operating profit margin is calculated by dividing operating income (gross income less operating expenses) by net
revenue.

Operating Profit 64,848,506 76,370,774 84,427,846 90,806,622 90,049,600

X 100
Sales Revenue 232,778,115 270,736,101 288,870,725 305,205,059 306,829,659
28% 28% 29% 30% 29%
6.02.3 Net Profit Margin
Net profit margin compares a company’s net income to Hemer Footwear Ltd's net revenue. This ratio is calculated by
dividing net income, or a company’s bottom line, by net revenue. It measures Hemer Footwear Ltd’s ability to translate
sales into earnings for shareholders.

Net Income 49,404,473 42,924,034 52,510,740 60,621,081 62,544,198

X 100
Sales Revenue 232,778,115 270,736,101 288,870,725 305,205,059 306,829,659
21% 16% 18% 20% 20%
6.02.4 EBITDA Margin
EBITDA margin is a profitability ratio that measures how much in earnings Hemer Footwear Ltd is generating before

interest, taxes, depreciation, and amortization, as a percentage of revenue. EBITDA Margin = EBITDA / Revenue.

EBITDA 80,379,435 91,901,703 99,958,775 106,337,552 105,580,529

X 100
Sales Revenue 232,778,115 270,736,101 288,870,725 305,205,059 306,829,659
35% 34% 35% 35% 34%

6.02.5 Return on Capital Employed (ROCE)

Return on capital employed or ROCE is a profitability ratio that measures how efficiently Hemer Footwear Ltd can
generate profits from Hemer Footwear Ltd's capital employed by comparing net operating profit to capital employed.
ROCE is a long-term profitability ratio because it shows how effectively assets are performing while taking into
consideration long-term financing.

Net Operating Income 64,848,506 76,370,774 84,427,846 90,806,622 90,049,600

Capital Employed 374,855,076 395,698,698 425,843,922 464,096,950 503,940,552
Capital Employed = 17.3% 19.3% 19.8% 19.6% 17.9%
Share Capital + Reserve + Non- Current Loans

6.02.6 Return on Assets (ROA)

Return on assets is calculated as net income divided by total assets. It is a measure of how efficiently Hemer Footwear
Ltd utilizes its assets.

Net Income 49,404,473 42,924,034 52,510,740 60,621,081 62,544,198

Average Total Assets 368,841,472 424,799,139 453,253,239 489,838,523 530,273,373
Average Total Assets = 13.39% 10.10% 11.59% 12.38% 11.79%
(Beginning Total Assets + Ending Total Assets) / 2

Page 10
6.02.7 Return on Equity (ROE)
Return on Equity ratio measures the level of income attributed to shareholders against the investment that shareholders
put into Hemer Footwear Ltd. It takes into account the amount of debt, or financial leverage, a firm uses. Financial
leverage magnifies the impact of earnings on ROE in both good and bad years.

Net Income 49,404,473 42,924,034 52,510,740 60,621,081 62,544,198

Average Stockholders' Equity 142,098,437 191,649,995 239,924,052 296,902,813 358,730,762
Average Stockholders' Equity = 35% 22% 22% 20% 17%
(Beginning Stockholders' Equity + Ending Stockholders' Equity) / 2

6.03 Activity Analysis Ratios

Activity ratios are used to measure how efficiently Hemer Footwear Ltd utilizes its assets. The ratios provide investors
with an idea of the overall operational performance of Hemer Footwear Ltd.

6.03.1 Assets Turnover Ratio

Asset turnover measures how efficiently Hemer Footwear Ltd uses its total assets to generate revenues. A low asset
turnover ratio may mean that Hemer Footwear Ltd is inefficient in its use of its assets or that it is operating in a capital-
intensive environment. Additionally, it may point to a strategic choice by management to use a more capital-intensive (as
opposed to a more labor-intensive) approach.

Sales Revenue 232,778,115 270,736,101 288,870,725 305,205,059 306,829,659

Average Total Assets 368,841,472 424,799,139 453,253,239 489,838,523 530,273,373
Average Total Assets = 63% 64% 64% 62% 58%
(Beginning Total Assets + Ending Total Assets) / 2

6.03.2 Accounts Receivable Turnover Ratio

The receivables turnover ratio is calculated by dividing net revenue by average receivables. This ratio is a measure of
how quickly and efficiently Hemer Footwear Ltd collects on its outstanding bills. The receivables turnover indicates how
many times per period the company collects and turns into cash its customers’ accounts receivable.

Sales Revenue 232,778,115 270,736,101 288,870,725 305,205,059 306,829,659

Average Accounts Receivable 14,520,124 15,708,554 17,346,078 18,237,795 18,778,129
Average Accounts Receivable = 16.03 17.23 16.65 16.73 16.34
(Beginning Accounts Receivable + Ending Accounts Receivable) / 2

6.03.3 Accounts Payable Turnover Ratio

The accounts payable turnover ratio is a liquidity ratio that shows Hemer Footwear Ltd's ability to pay off its accounts
payable by comparing net credit purchases to the average accounts payable during a period.

Total Purchases 119,532,770 126,953,169 134,373,567 141,793,965 141,793,965

Average Accounts Payable 10,020,969 10,334,124 10,960,435 11,586,745 11,899,900
Average Accounts Payable = 11.93 12.28 12.26 12.24 11.92
(Beginning Accounts Payable + Ending Accounts Payable) / 2

6.03.4 Inventory Turnover Ratio

Inventory turnover is calculated by dividing cost of goods sold by average inventory. A higher turnover than the industry
average means that inventory is sold at a faster rate, signaling inventory management effectiveness.

Cost of Goods Sold 162,625,390 189,246,226 199,305,919 209,220,687 211,409,398

Average Inventories 28,580,549 29,378,336 31,001,349 32,652,814 33,550,851
Average Inventories = 5.69 6.44 6.43 6.41 6.30
(Beginning Inventories + Ending Inventories) / 2

Page 11
6.04 Solvency Analysis Ratios

6.04.1 Debt to Assets Ratio

The debt-to-assets ratio is the most basic solvency ratio, measuring the percentage of Hemer Footwear Ltd’s total assets
that is financed by debt. A high number means Hemer Footwear Ltd is using a larger amount of financial leverage, which
increases its financial risk in the form of fixed interest payments.

Total Liabilities 242,774,453 223,523,834 203,134,539 182,736,881 160,348,340

Total Assets 412,612,820 436,985,457 469,521,020 510,156,025 550,390,720
0.59 0.51 0.43 0.36 0.29
6.04.2 Debt to Equity Ratio
The debt-to-equity ratio measures the amount of debt capital Hemer Footwear Ltd uses compared to the amount of

equity capital it uses. A ratio of 1.00x indicates that Hemer Footwear Ltd uses the same amount of debt as equity and

means that creditors have claim to all assets, leaving nothing for shareholders in the event of a theoretical liquidation.

Total Liabilities 242,774,453 223,523,834 203,134,539 182,736,881 160,348,340

Total Stockholders' Equity 169,838,367 213,461,623 266,386,481 327,419,144 390,042,380
0.59 0.51 0.43 0.36 0.29

6.04.3 Interest Coverage Ratio

The interest coverage ratio, also known as times interest earned, measures Hemer Footwear Ltd’s cash flows generated
compared to its interest payments.

Income Before Interest and Tax 64,848,506 76,370,774 84,427,846 90,806,622 90,049,600
Interest Expense 8,306,221 27,167,571 24,305,607 21,443,035 18,500,651
7.81 2.81 3.47 4.23 4.87

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 Hemer Footwear Ltd
Project Cost & Means of Finance

A) Project Cost:

Particulars Amount (BDT)

Land and Land development 54,432,000

Building & Civil Construction 13,387,900
Machinery cost-Foreign 159,866,520
C&F for Importable Machinery 4,795,996
Machinery cost-Local 16,886,000
Machinery Erection & Installation 4,721,250
Transport & Vehicles 8,560,000
Furniture, Fixture & Office Equipments 5,268,000
Security Deposit 15,500,000
Preliminary & Pre-operating Expenses 2,600,000
Total Fixed Cost 286,017,666
Interest During Construction Period(IDCP) 39,052,459
Net Working Capital (funded) 30,376,937
Total Project Cost 355,447,062

B) Means of Finance:

Fixed Investment 286,017,666

IDCP 39,052,459
Total Fixed Investment (including IDCP) 325,070,125
Debt Contribution 210,711,618
Equity Contribution 114,358,507
Debt-Equity Ratio 65:35
Debt to be contributed by Local Sources 210,711,618

Initial Working Capital Requirements (Funded) 30,376,937

Debt Contribution 24,301,550
Equity Contribution 6,075,387
Debt-Equity Ratio 80:20

Total Initial Investment Volume 355,447,062

Debt Contribution 235,013,168
Equity Contribution 120,433,894
Debt-Equity Ratio 66:34

C) Performance summary of the Project:

1. Pay Back Period 5.42 Years

2. Internal Rate of Return (IRR) 21.40%
3. Return on Equity ( ROE ) 21.89% in 3rd year
4. Net profit after tax on sales 18.18% in 3rd year

Page 13
 Hemer Footwear Ltd
Details of Project Cost

1 Land details
Particulars Area (Acre) Rate/ Acre Price Total Price (BDT)
1. Land (Lease asset for 10 years) 27.39 1,840,088 50,400,000 50,400,000
2. Land Development & Others Cost 27.39 147,207 4,032,000 4,032,000
Grand Total 1,987,295 54,432,000 54,432,000

2 Building and Civil Construction

Rate/
Particulars sft Price Total Price (BDT)
sft
Main factory shed-single storied 34,000 211 7,180,800 7,180,800
Service bay-3 storied 4,750 290 1,377,500 1,377,500
Raw Cotton Godown-1 storied 6,000 118 705,600 705,600
Finished Goods Godown -1 storied 2,500 118 294,000 294,000
Waste Godown-1 storied 2,500 118 294,000 294,000
Central Store-2 storied 2,000 290 580,000 580,000
Admin Building-2 storied 1,500 290 435,000 435,000
Utility Build-2 storied 3,000 276 828,000 828,000
Security Gate House-2 storied 1,500 222 333,000 333,000
Boundary wall, water drainage, internal road,
1,360,000 1,360,000
septic tank etc
Total 57,750 13,387,900 13,387,900

3 Machinery & Equipments: -

Unit price Total
Name of the Machinery Quantity Price
usd Price
Foreign Machinery Part:
Cutting Section
HYDRAULIC BEAM CUTTING MACHINE 18 2,150 38,700 4,644,000
TRAVELLING HEAD CUTING MACHINE, 25
TON WORKING TABLE: (1600 X 500) MM 10,000 1,200,000
WORKING TABLE: (1600 X 500)MM 2 5,000
SKIVING MACHINE WITHOUT DUST
5,160 619,200
COLLECTOR WITH CLUTCH MOTOR 12 430
LEATHER SKIVING MACHINE WITH DUST
COLLECTOR TABLE For TOE PUFF, COUNTER 1,430 171,600
with Lubrificiant device 2 715
FOAM SKIVING MACHINE 3 1,430 4,290 514,800

PNEUMATIC HIGH FREQUENCY EMBOSSING

22,880 2,745,600
& WELDING MACHINE- 5 KW /8KW
8 2,860
HYDRAULIC LOGO STAMPING
5,000 600,000
MACHINE(DOULE HEAD) 2 2,500
LAMINATION MACHINE
1.Extrusion die width 1200mm(Optional)
2.Coating width 500-1000mm(Optional)
3.Max.Coating speed 10-150m/min
4.Coating thickness 0.01-0.03mm 5.L/d ratio
for
1 12,150 12,150 1,458,000
screw 32:1
6.Rewinding roll diameter Ø1200mm
7.Overall size 12500*7000*3200mm
9.Mirror cool roll diameter Ø510mm
10.Adopt material Non
woven\BOPP\Aluminum foil
BINDING CUT MACHINE (FULL SET) 1 4,300 4,300 516,000
SEAMLESS 4 3,600 14,400 1,728,000
OVEN TWO LAYERS FOR SEAMLESS
4,300 516,000
OPERATION 2 2,150
LAYER TABLE PRINTING CONVEYOR
12000*800*750MM OVEN 4,600 552,000
2000*905*500MM 4 1,150
COMPLETE FOAM PLANT SET MACHINES
28,500 3,420,000
(SLICER/SPLITTING) width 500mm 1 28,500
Page 14
RAW MATERIALS MEASUREMENT
MACHINEWITH PERFECT LIGHTING FOR 715 85,800
QUALITY CHECKING 1 715
CUTTING KNIFE MAKING MACHINE 4 570 2,280 273,600
LEATHER SPLITTING MACHINE - 420MM
WORKING WIDTH 4 electric-
mechanical feed Speed (2 +2),
Working size: 420mm, Thickness: 4.5mm 3,000 360,000
Power: 4.3kw, Dimensions:
1580*1070*1140mm
N.W/G.W: 720/840kgs 1 3,000
DOUBLE HEAD LASER CUTTING &
ENGRAVING MACHINE 120 W TUBE
17,200 2,064,000
SIZE1600*1000MM, WITHOUT FEED
AUTOMATIC 4 4,300
PATTERN CUTTING PLOTTER WITH
2,150 258,000
SOFTWEAR 1 2,150
Sewing Section
ZIGZAG SEWING MACHINE WITH SAVE
12,960 1,555,200
POWER MOTOR 36 360
SINGLE NEEDLE FLAT BED ROLLER WITH
LOCK STITCH ROLLER SEWING MACHINE 18,000 2,160,000
WITH SAVE POWER MOTOR 50 360
SINGLE NEEDLE, NEEDLE FEED &
TOP/BOTTOM ROLLER FEED, POSTBED
SEWING MACHINE. DUE TO SPECIAL UNISON
FEED(NEEDLE FEED & TOP/BOTTOM
ROLLER FEED) , NO WRINKLE IN LIGHT 76,050 9,126,000
MATERIAL AND FINE STITCH IN HEAVY
MATERIAL WITH SAVE POWER MOTOR
130 585

DOUBLE NEEDLE, NEEDLE FEED &

TOP/BOTTOM ROLLER FEED, POSTBED
SEWING MACHINE. DUE TO SPECIAL UNISON
FEED (NEEDLE FEED & TOP/BOTTOM 55,250 6,630,000
ROLLER FEED) , NO WRINKLE INLIGHT
MATERIAL AND FINE STITCH IN HEAVY
MATERIAL WITH SAVE POWER MOTOR
85 650
CYLINDERBED BINDER MACHINE WITH
8,580 1,029,600
SAVE POWER MOTOR 12 715
GLUE SPRAY SINGLE HEAD
GLUE SPRAY ( DOUBLE HEAD) 12 500 6,000 720,000
TONGUE & COLLAR SHAPER 4 1,400 5,600 672,000
CYLINDER BED UPPER REPAIRING MACHINE 2,860 343,200
4 715
STROBLE CONOSTRUCTION FOR INSOLE
6,300 756,000
AND UPPER 14 450
UPPER AND INSOLE STITCHING MACHINE 2 1,450 2,900 348,000
ROLLER GLUE (PLASTIC) 12 430 5,160 619,200
EYELETING (AUTO) punch automatic 4 1,850 7,400 888,000
- -
EYELETING ( VELCRO) 2 1,900 3,800 456,000
- -

UPPER HAMMERING MACHINE FOR

4,380 525,600
REGULAR STITCHED UPPER BANDTYPE ARM
12 365
Hammering(back cntr join) 3 440 1,320 158,400
TOE BOX IRON ( THERMO PLASTIC) 10 400 4,000 480,000
ROLLER PRESS MACHINE ( SETTING) 6 360 2,160 259,200
WATER BASED GLUE/LATEX SPRAYING
3,000 360,000
MACHINE 4 750
TRIMMING MACHINE 12 315 3,780 453,600
COMPUTERIZED PATTERN SEWING
28,000 3,360,000
MACHINE 600 X 400MM 10 2,800
WEBBIN CUTTING 6 75 450 54,000
Harikata/Crimping Machine 2 3,600 7,200 864,000
Moccasin streaming, Heating and Iroing 1 5,000 5,000 600,000
BACK PART MOLDING- 6 4,570 27,420 3,290,400
LOCK STITCHING 6 CONES 6 860 5,160 619,200
THREAD RECONING MACHINE 2 430 860 103,200
Page 15
EDGE FOLDING MACHINE WITH AUTO
2,900 348,000
GLUING SYSTEM 2 1,450
Assembly and Finishing Section
INSOLE LATEX MACHINE 3 575 1,725 207,000
INSOLE MOULDING MACHINE 2 STATIONS
2,580 309,600
(WITH ONE PAIRS MOLDS) 3 860
VAMP STREAM/ HEATING MACHINE 4 460 1,840 220,800
INSOLE STAPLER MACHINE (TOOLS) 3 145 435 52,200
BACKPART MOULDING MACHINE 4
13,500 1,620,000
STATIONS WITH HOT & COLD AIR BAG 3 4,500
SOLE/LASTED UPPER MARKING MACHINE 6 360 2,160 259,200
TOE-LASTING MACHINE WITH 9 PINCERS
THERMOPLASTIC INJECTED COMPLETE 39,000 4,680,000
WITH 1 SET TOOLS AS PER SAMPLE LAST 6 6,500
HYDRAULIC HEEL LAST MACHINE WITHOUT CEMENTED 3 2,200 6,600 792,000
VACUUM SOLE PRESS MACHINE WITH
1,720 206,400
SINGLE STATION FOR 2 LINE 2 860
SIDE, TOE AND HEEL PRESS MACHINE 7 6,000 42,000 5,040,000
GRANDING --DOUBLE HEAD--5 NOS and
4,650 558,000
SINGLE HEAD--- 4 NOS 5 930
LAST SLIPPER 3 470 1,410 169,200
Pneumatic Glue Mixing pneumatic up and
down, pneumatic mixing for yelllo glue 720 86,400
20KGS 2 360
Upper and OUTSOLE STITCHING MACHINE 2 3,600 7,200 864,000
MOCCASIN UPPER STITCHING MACHINE 1 4,600 4,600 552,000
HOT AIR BLOWER MACHINE 60 28 1,680 201,600
ANTI FUNGAS SPRAY (BOOTH) 3 550 1,650 198,000
ANTI FUNFGAS/GERM KILLER MACHINE 3 3,300 9,900 1,188,000
NEEDLE SCANNING MACHINE 1 7,200 7,200 864,000
METAL
1,800 216,000
DETECTOR 3 600
A/F Line with oven & Conveyor----- 210 feet
107,145 12,857,400
total 3 35,715
INSPECTION CONVEYOR (L 23'.3 X WIDTH
4.5X H 2'.6"nspection Conveyor(L23'.3"'X 3,000 360,000
width 4'.5"XH2'.6") 1 3,000
Vamp heating/Toe Part Shapper 3 715 2,145 257,400
AUTO LACING 3 860 2,580 309,600
CHILLER MACHINE, 3.5 MTR LENGTH MAX
CAPACITY: 1800 PAIR/8HR TEMP. RANGE: 18,000 2,160,000
+5 DEGREE TO -15 DEGREE 3 6,000
IRONER WITH MODULER/WRINKLE
2,145 257,400
REMOVER 3 715
Outsole Machineries
PHYLON EVA INJECTION MACHINE 6/8
STATION 2 50,000 100,000 12,000,000
COLOR MIXER 1 6,450 6,450 774,000
THERMOSTAT/CURING CONVEYOR 2 11,450 22,900 2,748,000
AIR COMPRESSOR 2 1,430 2,860 343,200
DIRECT INJECTION PVC/TPR MACHINE 1 30,000 30,000 3,600,000
HVLS FAN 6 715 4,290 514,800
INJECTION PU POARING MACHINE 1 21,450 21,450 2,574,000
TPR MACHINE 1 25,715 25,715 3,085,800
PLANK PLANNER 1 715 715 85,800
BBT For Covering production Area(50,000
35,715
SFT) 1 35,715 4,285,800

LAB TESTING MACHINERIES(BOND TEST,

FLEXING TEST, TEAR TEST, COLOR
21,450
FASTENING TEST, ANTI YELLOW TESTING,
ANTI COLD TESTING, ABROATION TESTING)
10 2,145 2,574,000
WATERPROOF TESTING MACHINES 2 575 1,150 138,000
UPPER SEAM SEALING MACHINE 3 2,572 7,716 925,920
OUTSOLE MOULD DIFFERENT TYPES(FOR
115,000
MENS< WOMENS AND CHILDREN) 100 1,150 13,800,000
SUB STATION---1200 KVA 2 87000 10,440,000
GENERATOR---- 1200KVA 2 60000 7,200,000
D-HUMYDIFIRE/ANTI MOLDING AREA FOR WAREHOUSE 8 1,860 14,880 1,785,600
Total 804 393,495 1,332,221 159,866,520

Ancillary Cost for above imported Items

Page 16
Other Charges 3% of CFR value ( Marine Insurance, Cleaning & Forwarding, LC
3% 11,805 39,967 4,795,996
Commission, Import duties, Loading unloading, Inland freight,etc.)

Grand Total 405,300 1,372,188 164,662,516

Price in
Name of the Machinery Price in BDT
USD
Local Machinery/ Equipments Part:
Electrical Department
Tools & Meassuring Instrument 180,000
Lighting (Cable,Pole,light..etc) 150,000
Power Cable for Machinery & equipment 7,000,000
Utility & Mechanical Maintenace Department
GAS Line of the Factory (Material,Febrication & Installation) 3,260,000
Generator Pipe line (Material,Febrication & Installation) 760,000
Pump,with pipe & fittings 1,750,000

Page 17
 Water Tank 50,000
Supply duct( material Febrication & Installation) 650,000
Round duct & FDP connection 480,000
Pipe line(Material,Febrication & Installation) 70,000
Exhaust Fan 180,000
Fork lift,Hand lift etc. 1,360,000
Work shop Item(Gas cutting set,Welding M/C,lathe M/C etc.) 550,000
Cutting table 96,000
Tools & measuring Instrument 50,000
Rack 300,000

Total 16,886,000

4 Eraction & Installation -

Particulars Total Price in BDT
Erection Charges for Plant & Machinery including loading, unloading and shifiting 3,293,250
Erection Material for Electrical & Instruments 1,428,000

Total 4,721,250

5 Vehicles: -
Particulars Description Unit Unit Price Total Price in BDT
Toyota Premio 1.5L,
Car 1 3,250,000 3,250,000
1496cc
Toyota Hi Ace 2.7L,
Microbus 1 2,860,000 2,860,000
2694cc
Toyota Dyna 1.5 Ton
Covered Van 1 2,450,000 2,450,000
Covered Van
Total 8,560,000 8,560,000

6 Furniture & Fixture, Office Equipment and Other Assets: -

Particulars No. of M/c Unit price Total Price in BDT
Office Furniture, Fixture & Equipment 1 Lot 4,000,000 4,000,000
Air Conditioner 4 Nos 75,000 300,000
CC Camera Network System 5 Lot 1,700 8,500
Gate Punching System 1 Lot 9,500 9,500
Computer with Printer 10 Set 95,000 950,000
Total Cost of Furniture & Fixture, Office Equipment and Other Assets 5,268,000

7 Security deposite
Particulars Total Price in BDT
Security Deposit for Electric Connection 600,000
Security Deposit for Land Lease 14,400,000
Security Deposit for Gas 500,000
Sub-Total 15,500,000

8 Preliminery & Pre-operating Expenses:

Particulars Total Price in BDT
Business Licenses & Certificates 500,000
Supervision Charges for Engineers 1,100,000
Other cost 1,000,000
Sub-Total 2,600,000

9 Interest During Construction Perod (IDCP)

Particulars Total BDT
On Long Term Loan - Local Finance 39,052,458.75
Sub-Total 39,052,459

Page 18
 Hemer Footwear Ltd
Debt-Equity Ratio

Share % Total Debt Equity

SL No. Particulars
Debt Equity BDT BDT BDT

1 Land and Land development 0% 100% 54,432,000 - 54,432,000

2 Building & Civil Construction 30% 70% 13,387,900 4,016,370 9,371,530

3 Machinery cost-Foreign 90% 10% 159,866,520 143,879,868 15,986,652

4 C&F for Importable Machinery 90% 10% 4,795,996 4,316,396 479,600

5 Machinery cost-Local 90% 10% 16,886,000 15,197,400 1,688,600

6 Machinery Erection & Installation 90% 10% 4,721,250 4,249,125 472,125

7 Furniture, Fixture & Office Equipments 0% 100% 5,268,000 - 5,268,000

8 Transport & Vehicles 0% 100% 8,560,000 - 8,560,000

9 Security Deposit 0% 100% 15,500,000 - 15,500,000

10 Preliminary & Pre-operating Expenses 0% 100% 2,600,000 - 2,600,000

Total Fixed Cost 286,017,666 171,659,159 114,358,507

Debt-Equity Ratio (%) 100% 60% 40%

Page 19
 Hemer Footwear Ltd
Machine, Production & Raw Materials Capacity & Utilization

Production Capacity (at 100%) 1000

Particulars Unit Daily Qty Monthly Qty Yearly Qty

Sports shoes Pairs 600 16,800 201,600

Phylon outsole Pairs 850 23,800 285,600
TPR outsole Pairs 780 21,840 262,080
Total 2,230 62,440 749,280
Assumptions:
1. Working Days in a Month 28 Days
2. Working Days in a Year 336 Days

Raw Materials Requirements (at 100% Capacity)

Details in Annex- 6
Normal Total daily Req
Particulars Unit Daily Qty Monthly Qty Yearly Qty
Wastage Qty

Sports shoes materials Pairs 600 12 612.00 17,136 205,632

Phylon outsole KGs 191 3.825 195.08 5,462 65,545
TPR outsole KGs 273 5.46 278.46 7,797 93,563
Total 1,064 21 1,086 30,395 364,740
Assumptions:
1. Normal Wastage (%) 2%

Production at Utilized Capacity

Year-1 Year-2 Year-3 Year-4 Year-5 Year-6 Year-7 Year-8 Year-9 Year-10
Particulars Unit
80% 85% 90% 95% 95% 95% 95% 95% 95% 95%
Sports shoes Pairs 161,280 171,360 181,440 191,520 191,520 191,520 191,520 191,520 191,520 191,520
Phylon outsole Pairs 228,480 242,760 257,040 271,320 271,320 271,320 271,320 271,320 271,320 271,320
TPR outsole Pairs 209,664 222,768 235,872 248,976 248,976 248,976 248,976 248,976 248,976 248,976
Total 599,424 636,888 674,352 711,816 711,816 711,816 711,816 711,816 711,816 711,816

Raw Materials Requirements at Utilized Capacity (in kgs)

Year-1 Year-2 Year-3 Year-4 Year-5 Year-6 Year-7 Year-8 Year-9 Year-10
Particulars
80% 85% 90% 95% 95% 95% 95% 95% 95% 95%
Sports shoes materials 164,506 174,787 185,069 195,350 195,350 195,350 195,350 195,350 195,350 195,350

Phylon outsole 52,436 55,713 58,991 62,268 62,268 62,268 62,268 62,268 62,268 62,268

TPR outsole 74,850 79,528 84,206 88,884 88,884 88,884 88,884 88,884 88,884 88,884

Total 291,792 310,029 328,266 346,503 346,503 346,503 346,503 346,503 346,503 346,503

Packing Materials and Accessories Requirements

Particulars UOM Daily Qty Monthly Qty Yearly Qty
Shoe Box (31.5×21×12.5cm) Pcs 600 16,800 201,600
Tissue Paper Pcs 600 16,800 201,600
Plastic Pin - 60 × 25mm Pcs 600 16,800 201,600
C.B Case Pcs 600 16,800 201,600
Price Tag Pcs 600 16,800 201,600
Bar Code Pcs 600 16,800 201,600

N.B.- packing materials and accessories for Phylon outsole and TPR outsole are include in there cost value.

Packing Materials Requirements at Utilized Capacity (in kgs)

Year-1 Year-2 Year-3 Year-4 Year-5 Year-6 Year-7 Year-8 Year-9 Year-10
Particulars
80% 85% 90% 95% 95% 95% 95% 95% 95% 95%
Shoe Box (31.5×21×12.5cm) 161,280 171,360 181,440 191,520 191,520 191,520 191,520 191,520 191,520 191,520
Tissue Paper 161,280 171,360 181,440 191,520 191,520 191,520 191,520 191,520 191,520 191,520
Plastic Pin - 60 × 25mm 161,280 171,360 181,440 191,520 191,520 191,520 191,520 191,520 191,520 191,520
C.B Case 161,280 171,360 181,440 191,520 191,520 191,520 191,520 191,520 191,520 191,520
Price Tag 161,280 171,360 181,440 191,520 191,520 191,520 191,520 191,520 191,520 191,520
Bar Code 161,280 161,280 161,280 161,280 161,280 161,280 161,280 161,280 161,280 161,280

Raw Materials Cost (at 100% Capacity)

Monthly Raw materials Cost Annual Raw materials Cost
Particulars Daily Raw materials Cost (BDT)
(BDT) (BDT)
1
Materials for Sports shoes 194,341 5,441,537 65,298,442
Phylon outsole 110,256 3,087,179 37,046,147
TPR outsole 112,943 3,162,415 37,948,974
Total 417,540 11,691,130 140,293,563

Page 20
Raw Materials Cost at Utilized Capacity
Year-1 Year-2 Year-3 Year-4 Year-5 Year-6 Year-7 Year-8 Year-9 Year-10
Particulars
80% 85% 90% 95% 95% 95% 95% 95% 95% 95%
Materials for Sports shoes 52,238,753 55,503,675 58,768,597 62,033,520 62,033,520 62,033,520 62,033,520 62,033,520 62,033,520 62,033,520

Phylon outsole 29,636,918 31,489,225 33,341,532 35,193,840 35,193,840 35,193,840 35,193,840 35,193,840 35,193,840 35,193,840

TPR outsole 30,359,179 32,256,628 34,154,077 36,051,526 36,051,526 36,051,526 36,051,526 36,051,526 36,051,526 36,051,526

Total 112,234,850 119,249,529 126,264,207 133,278,885 133,278,885 133,278,885 133,278,885 133,278,885 133,278,885 133,278,885

Assumptions:
Sports shoes material price per pair BDT 317.55
Phylon outsole material price per kg BDT 565.20
Tpr outsole material Price per kg BDT 405.60

Packing Materials Cost at Utilized Capacity

Year-1 Year-2 Year-3 Year-4 Year-5 Year-6 Year-7 Year-8 Year-9 Year-10
Particulars
80% 85% 90% 95% 95% 95% 95% 95% 95% 95%
Shoe Box (31.5×21×12.5cm) 2,903,040 3,084,480 3,265,920 3,447,360 3,447,360 3,447,360 3,447,360 3,447,360 3,447,360 3,447,360
Tissue Paper 645,120 685,440 725,760 766,080 766,080 766,080 766,080 766,080 766,080 766,080
Plastic Pin - 60 × 25mm 40,320 42,840 45,360 47,880 47,880 47,880 47,880 47,880 47,880 47,880
C.B Case 2,419,200 2,570,400 2,721,600 2,872,800 2,872,800 2,872,800 2,872,800 2,872,800 2,872,800 2,872,800
Price Tag 483,840 514,080 544,320 574,560 574,560 574,560 574,560 574,560 574,560 574,560
Bar Code 806,400 806,400 806,400 806,400 806,400 806,400 806,400 806,400 806,400 806,400
Total 7,297,920 7,703,640 8,109,360 8,515,080 8,515,080 8,515,080 8,515,080 8,515,080 8,515,080 8,515,080

Assumptions:
Shoe Box BDT 18.00 per Box
Tissue Paper BDT 4.00 per Pc
Plastic Pin BDT 0.25 per Pc
C.B Case BDT 15 per Pc
Price Tag BDT 3 per Pc
Bar Code BDT 5 per Pc

Page 21
 Hemer Footwear Ltd
Projected Raw Materials Usages

Annexer- 6
Sports shoes :
BDT Per Per Month Material Cost Per Year Material
Description Unit Materials
Pair (16800 Pair) Cost (201600
Upper Fabrics/Synthetic SFT 2.45 1,452,528 17,430,336
86.46

Lining/ Sponge/ Toe Puff SFT 1.88/0.60/0.25 690,816 8,289,792

41.12
Cost
Lace/ Insole/ Sock Cost Pcs 02/0.65/0.70 397,488 4,769,856
23.66
Outsole Cost Pcs pu/eva 1,892,184 22,706,208
112.63

Others Accories Buckle/Eyelite/Tung Lable/Socks Print 458,304 5,499,648

27.28
Total Materials Cost 291.15 4,891,320 58,695,840
Thread, Chemical & 26.40 443,520 5,322,240
Others Mat. Cost
Total Others Materials 443,520 5,322,240
26.40
Cost
Total Materias & 317.55 5,334,840 64,018,080
Manufacturing cost

Phylon outsole:
Per Pair Total
Sole Production Per Year Raw Material Cost Per Year Raw
Materials Name Consumtio Consumtion PRICE/kg(USD)
Per Year (Pair) USD Material Cost BDT
n gm Per
Compound
225 285,600 64,260 4.51 289,813 34,777,512
Accessories & Others
64,260 0.20 12,852 1,542,240
4.71 302,665 36,319,752

TPR outsole:
Per Pair Total
Sole Production Per Year Raw Material Cost Per Year Raw
Materials Name Consumtio Consumtion PRICE/kg(USD)
Per Year (Pair) USD Material Cost BDT
n gm Per
Compound
350 262,080 91,728 3.18 291,695 35,003,405
Accessories & Others
91,728 0.20 18,346 2,201,472
3.38 310,041 37,204,877
 Hemer Footwear Ltd
Detail cost of Factory Overhead and Administrative Overhead
Consumption Analysis
Particulars Quantity Amount
Electricity Connected Load 1200 KWH
Maximum Demand 250 KWH
Diesel Required 1 - Covered Van 3300 Ltr Consumption Details
Octane Requied 1 microbus + 1 Car 2240 Ltr
Assumptions:
Hours in a Day 24
Days in a month 28
Days in a year 336

POWER CONSUMPTION:
Items Qty Rate in BDT Total (BDT)
Electricity 1,612,800 8 12,241,152
VAT 5% 0.34 550,852
Diesel 3,300 104 343,200
Octane 2,240 125 280,000
Lubricant (Ltr) 800 560 448,000
Grease (Kgs) 450 1,300 585,000

TOTAL POWER & FUEL CONSUMPTIOM

Operating Year Year-1 Year-2 Year-3 Year-4 Year-5 Year-6 Year-7 Year-8 Year-9 Year-10

80% 85% 90% 95% 95% 95% 95% 95% 95% 95%
Electricity 10,233,603 10,873,203 11,512,803 12,152,404 12,152,404 12,152,404 12,152,404 12,152,404 12,152,404 12,152,404
Diesel 274,560 291,720 308,880 326,040 326,040 326,040 326,040 326,040 326,040 326,040
Octane 224,000 238,000 252,000 266,000 266,000 266,000 266,000 266,000 266,000 266,000
Lubricant (Ltr) 358,400 380,800 403,200 425,600 425,600 425,600 425,600 425,600 425,600 425,600
Grease (Kgs) 468,000 497,250 526,500 555,750 555,750 555,750 555,750 555,750 555,750 555,750
Total 11,558,563 12,280,973 13,003,383 13,725,794 13,725,794 13,725,794 13,725,794 13,725,794 13,725,794 13,725,794
Spares Parts Expenses
Spares parts
(.5%, .75%, 1%, 1.25%, for 1st, 2nd, 3rd &
931,349 1,397,023 1,862,698 2,328,372 2,794,046 2,794,046 2,794,046 2,794,046 2,794,046 2,794,046
4th yr and 1.5% rest)
Sub-Total 931,349 1,397,023 1,862,698 2,328,372 2,794,046 2,794,046 2,794,046 2,794,046 2,794,046 2,794,046
Page 23
Repair & Mantenance:
 -On Machinery & Equipment 465,674 931,349 1,397,023 1,862,698 1,862,698 1,862,698 1,862,698 1,862,698 1,862,698 1,862,698
(0.25%,0 .5%, .75%, 1% on M/c cost)
-On Buildings (.5% on Building cost) 66,940 66,940 66,940 66,940 66,940 66,940 66,940 66,940 66,940 66,940
-On Vehicles 42,800 64,200 85,600 107,000 128,400 128,400 128,400 128,400 128,400 128,400
- (0.5%, 0.75% , 1%,1.25% & 1.5%)
Sub-Total 575,414 1,062,488 1,549,563 2,036,637 2,058,037 2,058,037 2,058,037 2,058,037 2,058,037 2,058,037

Rent, Tax & Insurance

Operating Year Year-1 Year-2 Year-3 Year-4 Year-5 Year-6 Year-7 Year-8 Year-9 Year-10
Insurance on Fixed Assets-0.35% on cost 1,137,745 1,137,745 1,137,745 1,137,745 1,137,745 1,137,745 1,137,745 1,137,745 1,137,745 1,137,745
Other charge, Fees, Taxes 90,000 92,250 94,556 96,920 99,343 101,827 104,372 106,982 109,656 112,398
Sub-Total 1,227,745 1,229,995 1,232,302 1,234,666 1,237,089 1,239,572 1,242,118 1,244,727 1,247,402 1,250,143
Total 2,734,508 3,689,507 4,644,562 5,599,675 6,089,172 6,091,656 6,094,201 6,096,811 6,099,485 6,102,227

ADMINISTRATIVE & MARKETING EXPENSES

Operating Year Year-1 Year-2 Year-3 Year-4 Year-5 Year-6 Year-7 Year-8 Year-9 Year-10
Salary & allowances 6,487,000 6,649,175 6,815,404 6,985,789 7,160,434 7,339,445 7,522,931 7,711,004 7,903,780 8,101,374
Directors remuneration 750,000 768,750 787,969 807,668 827,860 848,556 869,770 891,514 913,802 936,647
Postage, Telephone & Fax 40,000 40,832 41,665 42,498 43,331 44,181 45,046 45,929 46,830 47,747
Printing & Stationery 50,000 52,500 54,968 57,463 59,957 62,559 65,274 68,107 71,063 74,147
Traveling & Conveyance 125,000 127,500 129,999 132,499 134,998 137,544 140,138 142,781 145,474 148,217
Advertisment & Sales Promotion 50,000 51,040 52,081 53,123 54,164 55,226 56,308 57,412 58,537 59,684
Misc Expenses 30,000 31,665 33,331 34,997 36,663 38,408 40,236 42,152 44,158 46,260
Audit & Professional Fees 100,000 105,000 110,250 115,763 121,551 127,628 134,010 140,710 147,746 155,133
Total 7,632,000 7,826,462 8,025,666 8,229,800 8,438,958 8,653,547 8,873,714 9,099,610 9,331,389 9,569,210

FINANCIAL OVERHEAD
Operating Year Year-1 Year-2 Year-3 Year-4 Year-5 Year-6 Year-7 Year-8 Year-9 Year-10
Interest on Term Loan - Local Fund 6,848,128 25,541,665 22,580,313 19,618,960 16,657,608 13,696,255 10,734,903 7,773,550 4,812,198 1,850,845
Interest on W/C (Funded Facility) 1,458,093 1,625,906 1,725,295 1,824,074 1,843,043 1,851,107 1,859,308 1,867,733 1,876,388 1,885,280
Commission on W/C (Non-Funded Facility) 400,839 425,891 450,944 475,996 475,996 475,996 475,996 475,996 475,996 475,996
Total $8,707,059 $27,593,463 $24,756,551 $21,919,031 $18,976,647 ######### $13,070,206 ######### $7,164,582 $4,212,122
Assumption:
i) Commission on no-funded facilities like L/C will be @ 0.25% per quarter.
ii) Interest rate on funded facility including term loan except imported Machinery will be - 6%
iii) Interest on term loan will be- 13%

Page 24
 Hemer Footwear Ltd
Human Resources Requirements

Total Salary &

Overtime
Description Nos Salary/mon Yearly Salary Bonus Bunus /
Salary
th/person Annum
A. Management/Staff(Technical)
General Manager 1 50,000 600,000 50,000 650,000
Production Manager 2 45,000 1,080,000 90,000 1,170,000
Merchandising Manager 1 45,000 540,000 45,000 585,000
Marchandiser 2 35,000 840,000 70,000 910,000
Manager Quality Control 1 35,000 420,000 35,000 455,000
Quality Control Officer 1 22,000 264,000 22,000 286,000
Supervisor 5 18,500 1,110,000 92,500 1,202,500
Production Worker (Skilled) 90 14,500 15,660,000 1,305,000 16,965,000
Production Worker (Semi-Skilled) 30 11,000 3,960,000 330,000 4,290,000
Assistant Engineer (Mechanical &
2 25,000 600,000 50,000 650,000
Electrical)
Foreman (Mechanical & Electircal) 2 17,500 420,000 35,000 455,000
Operator of Supporting Machinery 4 17,500 840,000 70,000 910,000
Driver (Car / Micro) 2 18,000 432,000 36,000 468,000
Driver (Truck / Pick-up) 1 20,000 240,000 20,000 260,000
Helper (Truck / Pick-up) 1 12,500 150,000 12,500 162,500
Peon & Cleaner 5 12,000 720,000 60,000 780,000
Security In-charge 1 27,200 326,400 27,200 353,600
Security Guard 4 12,000 576,000 48,000 624,000
Sub Total 155 28,778,400 2,398,200 31,176,600 -
General & Administrative
Manager Administration 1 70,000 840,000 70,000 910,000
Manager Finance & Accounts 1 55,000 660,000 55,000 715,000
Commercial Manager 1 55,000 660,000 55,000 715,000
Executives (Commercial and Accounts ) 4 30,000 1,440,000 120,000 1,560,000
HR & Compliance Officer 2 20,000 480,000 40,000 520,000
Office Executive 5 20,000 1,200,000 100,000 1,300,000
Front Desk Officer 1 15,000 180,000 15,000 195,000
Welfare Officer 1 20,000 240,000 20,000 260,000
Cleaner 1 12,000 144,000 12,000 156,000
Peon 1 12,000 144,000 12,000 156,000
Sub Total 18 5,988,000 499,000 6,487,000 -
Total 173 34,766,400 2,897,200 37,663,600
Particulars No. Salary/Anum
Total Manpower : Wages 155 31,176,600
General & Admin 18 6,487,000
Grand Total 173 37,663,600

Page 25
 Hemer Footwear Ltd
Working Capital Assessment

Tied up
Current Assets Remarks
period

Imported raw materials (LC stage) 120 Raw materials which will be purchased from foreign market as such tide up period is considered at 120-days.

Imported raw materials (Funded) 30 Raw materials which will be purchased from foreign market as such tide up period is considered at 30-days.

Local Raw Materials 30 Raw materials which will be purchased from local market as such tide up period is considered at 30-days.

Work-in-process of this project begings from cotton and ended to weighing , packing & cartoning and on average to go through
Work-in-Process 4
all the process it generally requires 4 days.
From our practical experience and knowledge, it has been found that in textile mills industry, at least 30 days stocks needs to
Finished Goods 30
be maintained.
Receivables 30 There will be trade credit for 30 days at least
Payable 30 Payment will be made after every 30 days at least
Other Expenses 30 Payment against expenditures will be made after every 30 days at least
Stores & Spares 90 There will be 90 days inventory stocks for Stores & Spares.
Figure in USD '000'
Blocked
Component of W.C Year-1 Year-2 Year-3 Year-4 Year-5 Year-6 Year-7 Year-8 Year-9 Year-10
Period
Attainable Capacity 80% 85% 90% 95% 95% 95% 95% 95% 95% 95%
Inventories:
Imported raw materials 120 day 40,083,875 42,589,117 45,094,360 47,599,602 47,599,602 47,599,602 47,599,602 47,599,602 47,599,602 47,599,602
Imported raw materials 30 day 10,020,969 10,429,988 11,043,517 11,657,045 11,657,045 11,657,045 11,657,045 11,657,045 11,657,045 11,657,045
Local Raw Materials 30 day 651,600 673,788 709,273 744,759 744,759 744,759 744,759 744,759 744,759 744,759
Work-in-Process 4 day 1,964,315 2,081,901 2,199,719 2,317,776 2,333,596 2,348,770 2,364,347 2,380,339 2,396,757 2,413,612
Finished Goods 30 day 15,943,666 16,990,447 17,874,066 18,759,473 18,887,248 19,001,108 19,117,903 19,237,807 19,360,904 19,487,279
Receivable at Cost 30 day 14,520,124 16,896,984 17,795,171 18,680,418 18,875,839 18,990,942 19,107,475 19,227,101 19,349,913 19,475,995
Payable at Cost 30 day (10,020,969) (10,647,279) (11,273,590) (11,899,900) (11,899,900) (11,899,900) (11,899,900) (11,899,900) (11,899,900) (11,899,900)
Other Expenses 30 day (3,435,225) (3,541,041) (3,648,596) (3,757,935) (3,832,876) (3,909,691) (3,988,427) (4,069,130) (4,151,852) (4,236,641)
Stores & Spares 90 day 732,458 988,261 1,244,079 1,499,913 1,631,028 1,631,694 1,632,375 1,633,074 1,633,791 1,634,525
Total 30,376,937 76,462,166 81,037,999 85,601,152 85,996,341 86,164,327 86,335,179 86,510,697 86,691,019 86,876,276

Total Working Capital Requirement 30,376,937 76,462,166 81,037,999 85,601,152 85,996,341 86,164,327 86,335,179 86,510,697 86,691,019 86,876,276

Break-up of Working Capital Requirement:

Non-Funded 40,083,875 42,589,117 45,094,360 47,599,602 47,599,602 47,599,602 47,599,602 47,599,602 47,599,602 47,599,602
Funded:
Imported raw materials 10,020,969 10,429,988 11,043,517 11,657,045 11,657,045 11,657,045 11,657,045 11,657,045 11,657,045 11,657,045
Local Raw Materials 651,600 673,788 709,273 744,759 744,759 744,759 744,759 744,759 744,759 744,759
Work-in-Process 1,964,315 2,081,901 2,199,719 2,317,776 2,333,596 2,348,770 2,364,347 2,380,339 2,396,757 2,413,612
Finished Goods 15,943,666 16,990,447 17,874,066 18,759,473 18,887,248 19,001,108 19,117,903 19,237,807 19,360,904 19,487,279
Receivable at Cost 14,520,124 16,896,984 17,795,171 18,680,418 18,875,839 18,990,942 19,107,475 19,227,101 19,349,913 19,475,995
Payable at Cost (10,020,969) (10,647,279) (11,273,590) (11,899,900) (11,899,900) (11,899,900) (11,899,900) (11,899,900) (11,899,900) (11,899,900)
Other Expenses (3,435,225) (3,541,041) (3,648,596) (3,757,935) (3,832,876) (3,909,691) (3,988,427) (4,069,130) (4,151,852) (4,236,641)
Stores & Spares 732,458 988,261 1,244,079 1,499,913 1,631,028 1,631,694 1,632,375 1,633,074 1,633,791 1,634,525
Sub-Total (Funded) 30,376,937 33,873,049 35,943,640 38,001,550 38,396,739 38,564,725 38,735,577 38,911,096 39,091,417 39,276,675
Bank Finance 80% 24,301,550 27,098,439 28,754,912 30,401,240 30,717,391 30,851,780 30,988,462 31,128,876 31,273,134 31,421,340
Sponsor's Equity 20% 6,075,387 6,774,610 7,188,728 7,600,310 7,679,348 7,712,945 7,747,115 7,782,219 7,818,283 7,855,335
Total 70,460,812 76,462,166 81,037,999 85,601,152 85,996,341 86,164,327 86,335,179 86,510,697 86,691,019 86,876,276

Assumption: Sponsors equity against working capital will be 20% and rest amount will be financed by the bank.
Working days in a year Days 336

Page 26
 Hemer Footwear Ltd
Projected Cost of Goods Sold Statement

PARTICULAR Year-1 Year-2 Year-3 Year-4 Year-5 Year-6 Year-7 Year-8 Year-9 Year-10

Attainable Capacity 80% 85% 90% 95% 95% 95% 95% 95% 95% 95%
Raw Materials 112,234,850 119,249,529 126,264,207 133,278,885 133,278,885 133,278,885 133,278,885 133,278,885 133,278,885 133,278,885
Packing Materials 7,297,920 7,703,640 8,109,360 8,515,080 8,515,080 8,515,080 8,515,080 8,515,080 8,515,080 8,515,080
Factory Wages & Salaries 31,176,600 31,956,015 32,754,915 33,573,788 34,413,133 35,273,461 36,155,298 37,059,180 37,985,660 38,935,301
Factory Power, Fuel & Lubricant 11,558,563 12,280,973 13,003,383 13,725,794 13,725,794 14,137,567 14,561,694 14,998,545 15,448,502 15,911,957
Repair, Maintenance, Stores and
Spares 2,734,508 3,689,507 4,644,562 5,599,675 6,089,172 6,091,656 6,094,201 6,096,811 6,099,485 6,102,227
Depreciation & Amortization 15,530,929 15,530,929 15,530,929 15,530,929 15,530,929 15,530,929 15,530,929 15,530,929 15,530,929 15,530,929
Total Production Cost 180,533,371 190,410,593 200,307,357 210,224,151 211,552,993 212,827,579 214,136,088 215,479,430 216,858,541 218,274,379

Add: Opening Stock of W-I-P - 1,964,315 2,081,901 2,199,719 2,317,776 2,333,596 2,348,770 2,364,347 2,380,339 2,396,757
Total Manufacturing Cost 180,533,371 192,374,908 202,389,258 212,423,870 213,870,769 215,161,175 216,484,857 217,843,778 219,238,880 220,671,136

Less: Closing Stock of W-I-P 4 1,964,315 2,081,901 2,199,719 2,317,776 2,333,596 2,348,770 2,364,347 2,380,339 2,396,757 2,413,612
Total Cost of Goods Manufactured 178,569,056 190,293,007 200,189,538 210,106,094 211,537,173 212,812,405 214,120,510 215,463,438 216,842,123 218,257,524

Add: Opening Stock of Fin Goods - 15,943,666 16,990,447 17,874,066 18,759,473 18,887,248 19,001,108 19,117,903 19,237,807 19,360,904
Goods available for sale 178,569,056 206,236,673 217,179,985 227,980,160 230,296,646 231,699,653 233,121,618 234,581,341 236,079,930 237,618,427

Less: Closing Stock of Fin Goods 30 15,943,666 16,990,447 17,874,066 18,759,473 18,887,248 19,001,108 19,117,903 19,237,807 19,360,904 19,487,279
Cost of Goods Sold 162,625,390 189,246,226 199,305,919 209,220,687 211,409,398 212,698,545 214,003,715 215,343,534 216,719,026 218,131,148

Page 27
 Hemer Footwear Ltd
Loan Repayment Schedule

1 Loan amount - Principal - 171,659,159

2 IDCP 39,052,459
3 Total Loan including IDCP - 210,711,618
4 Term (Including 1.9 years Grace Period) 10 years
5 Mode of Repayment: Equal Quarterly Installment (EQI)
6 Installment numbers 37 Quarterly
7 Rate of Interest: 13.0% p.a.
8 Source of Finance Local Bank Finance
Local Finance
Install Principal
Year Principal Interest Interest payment Installment Closing bal
ment payment
Year-01 1 210,711,618 6,848,128 5,694,909 6,848,128 12,543,036 205,016,709
Year-01- total 6,848,128 5,694,909 6,848,128 12,543,036
2 205,016,709 6,663,043 5,694,909 6,663,043 12,357,952 199,321,801
3 199,321,801 6,477,959 5,694,909 6,477,959 12,172,867 193,626,892
Year-02
4 193,626,892 6,292,874 5,694,909 6,292,874 11,987,783 187,931,984
5 187,931,984 6,107,789 5,694,909 6,107,789 11,802,698 182,237,075
Year-02- total 25,541,665 22,779,634 25,541,665 48,321,299
6 182,237,075 5,922,705 5,694,909 5,922,705 11,617,614 176,542,166
7 176,542,166 5,737,620 5,694,909 5,737,620 11,432,529 170,847,258
Year-03
8 170,847,258 5,552,536 5,694,909 5,552,536 11,247,444 165,152,349
9 165,152,349 5,367,451 5,694,909 5,367,451 11,062,360 159,457,441
Year-03- total 22,580,313 22,779,634 22,580,313 45,359,947
10 159,457,441 5,182,367 5,694,909 5,182,367 10,877,275 153,762,532
11 153,762,532 4,997,282 5,694,909 4,997,282 10,692,191 148,067,624
Year-04
12 148,067,624 4,812,198 5,694,909 4,812,198 10,507,106 142,372,715
13 142,372,715 4,627,113 5,694,909 4,627,113 10,322,022 136,677,806
Year-04- total 19,618,960 22,779,634 19,618,960 42,398,595
14 136,677,806 4,442,029 5,694,909 4,442,029 10,136,937 130,982,898
15 130,982,898 4,256,944 5,694,909 4,256,944 9,951,853 125,287,989
Year-05
16 125,287,989 4,071,860 5,694,909 4,071,860 9,766,768 119,593,081
17 119,593,081 3,886,775 5,694,909 3,886,775 9,581,684 113,898,172
Year-05- total 16,657,608 22,779,634 16,657,608 39,437,242
18 113,898,172 3,701,691 5,694,909 3,701,691 9,396,599 108,203,263
19 108,203,263 3,516,606 5,694,909 3,516,606 9,211,515 102,508,355
Year-06
20 102,508,355 3,331,522 5,694,909 3,331,522 9,026,430 96,813,446
21 96,813,446 3,146,437 5,694,909 3,146,437 8,841,346 91,118,538
Year-06- total 13,696,255 22,779,634 13,696,255 36,475,890
22 91,118,538 2,961,352 5,694,909 2,961,352 8,656,261 85,423,629
23 85,423,629 2,776,268 5,694,909 2,776,268 8,471,177 79,728,720
Year-07
24 79,728,720 2,591,183 5,694,909 2,591,183 8,286,092 74,033,812
25 74,033,812 2,406,099 5,694,909 2,406,099 8,101,007 68,338,903
Year-07- total 10,734,903 22,779,634 10,734,903 33,514,537
26 68,338,903 2,221,014 5,694,909 2,221,014 7,915,923 62,643,995

Year-08 Page 28
 27 62,643,995 2,035,930 5,694,909 2,035,930 7,730,838 56,949,086
Year-08
28 56,949,086 1,850,845 5,694,909 1,850,845 7,545,754 51,254,177
29 51,254,177 1,665,761 5,694,909 1,665,761 7,360,669 45,559,269
Year-08- total 7,773,550 22,779,634 7,773,550 30,553,185
30 45,559,269 1,480,676 5,694,909 1,480,676 7,175,585 39,864,360
31 39,864,360 1,295,592 5,694,909 1,295,592 6,990,500 34,169,452
Year-09
32 34,169,452 1,110,507 5,694,909 1,110,507 6,805,416 28,474,543
33 28,474,543 925,423 5,694,909 925,423 6,620,331 22,779,634
Year-09- total 4,812,198 22,779,634 4,812,198 27,591,832
34 22,779,634 740,338 5,694,909 740,338 6,435,247 17,084,726
35 17,084,726 555,254 5,694,909 555,254 6,250,162 11,389,817
Year-10
36 11,389,817 370,169 5,694,909 370,169 6,065,078 5,694,909
37 5,694,909 185,085 5,694,909 185,085 5,879,993 (0)
Year-10- total 1,850,845 22,779,634 1,850,845 24,630,480
Total 130,114,424 210,711,618 130,114,424 340,826,042

Page 29
 Hemer Footwear Ltd
Projected Revenue Calculation
1
Sales Revenue at Rated Capacity:
Particulars Unit Quantity Rate (BDT) Amount (BDT)
Sports shoes Pairs 201,600 1,020 205,632,000
Phylon outsole Pairs 285,600 240.00 68,544,000
TPR outsole Pairs 262,080 180.00 47,174,400
Total 749,280 321,350,400
Average Selling Price BDT
Sports shoes 1,020 Per pairs
Phylon outsole 240.00 Per pairs
TPR outsole 180.00 Per pairs

Year-1 Year-2 Year-3 Year-4 Year-5 Year-6 Year-7 Year-8 Year-9 Year-10

Attainable Capacity 80% 85% 90% 95% 95% 95% 95% 95% 95% 95%

Sales at Utilized Capacity in BDT 257,080,320 273,147,840 289,215,360 305,282,880 305,282,880 305,282,880 305,282,880 305,282,880 305,282,880 305,282,880
Add: Opening Stock of W-I-P (2 days) - 3,060,480 3,288,194 3,482,185 3,675,775 3,678,079 3,678,107 3,678,107 3,678,107 3,678,107
Total 257,080,320 276,208,320 292,503,554 308,765,065 308,958,655 308,960,959 308,960,987 308,960,987 308,960,987 308,960,987
Less: Closing Stock of W-I-P (2 days) 3,060,480 3,288,194 3,482,185 3,675,775 3,678,079 3,678,107 3,678,107 3,678,107 3,678,107 3,678,107
Total 254,019,840 272,920,126 289,021,369 305,089,291 305,280,575 305,282,853 305,282,880 305,282,880 305,282,880 305,282,880
Add: Opening Stock of Fin Goods - 22,680,343 26,392,899 28,161,988 29,754,578 29,913,853 29,928,277 29,929,568 29,929,683 29,929,693
Total 254,019,840 295,600,469 315,414,268 333,251,279 335,035,154 335,196,706 335,211,157 335,212,448 335,212,563 335,212,573
Less: Closing Stock of Fin Goods 22,680,343 26,392,899 28,161,988 29,754,578 29,913,853 29,928,277 29,929,568 29,929,683 29,929,693 29,929,694
Net Sales 231,339,497 269,207,570 287,252,280 303,496,700 305,121,301 305,268,428 305,281,589 305,282,765 305,282,870 305,282,879
Wastages - Sales 1,438,618 1,528,531 1,618,445 1,708,358 1,708,358 1,708,358 1,708,358 1,708,358 1,708,358 1,708,358
Total Sales 232,778,115 270,736,101 288,870,725 305,205,059 306,829,659 306,976,787 306,989,948 306,991,123 306,991,228 306,991,237
Wastage Sales
Wastages - in Kgs 11,988 12,738 13,487 14,236 14,236 14,236 14,236 14,236 14,236 14,236
-
Wastages - Sales 1,438,618 1,528,531 1,618,445 1,708,358 1,708,358 1,708,358 1,708,358 1,708,358 1,708,358 1,708,358
Assumptions:
Wastage Percentage (%) 2%
Wastage Sales Price BDT 120

Page 30
 Hemer Footwear Ltd
Projected Statement of Comprehensive Income

PARTICULAR Year-1 Year-2 Year-3 Year-4 Year-5 Year-6 Year-7 Year-8 Year-9 Year-10

Attainable Capacity 80% 85% 90% 95% 95% 95% 95% 95% 95% 95%
Turnover 235,105,896 273,443,462 291,759,432 308,257,109 309,897,956 310,046,555 310,059,847 310,061,034 310,061,140 310,061,150

Sales Revenue 232,778,115 270,736,101 288,870,725 305,205,059 306,829,659 306,976,787 306,989,948 306,991,123 306,991,228 306,991,237

Cash Incentive 2,327,781 2,707,361 2,888,707 3,052,051 3,068,297 3,069,768 3,069,899 3,069,911 3,069,912 3,069,912

Cost of Goods Sold 162,625,390 189,246,226 199,305,919 209,220,687 211,409,398 212,698,545 214,003,715 215,343,534 216,719,026 218,131,148

Gross Income 72,480,506 84,197,236 92,453,513 99,036,422 98,488,557 97,348,010 96,056,132 94,717,500 93,342,114 91,930,001

Administrative
Overhead 7,632,000 7,826,462 8,025,666 8,229,800 8,438,958 8,438,958 8,438,958 8,438,958 8,438,958 8,438,958

Operating Income 64,848,506 76,370,774 84,427,846 90,806,622 90,049,600 88,909,052 87,617,175 86,278,543 84,903,157 83,491,044

Financial Expenses 8,707,059 27,593,463 24,756,551 21,919,031 18,976,647 16,023,358 13,070,206 10,117,279 7,164,582 4,212,122

Income before Tax 56,141,446 48,777,312 59,671,295 68,887,592 71,072,953 72,885,694 74,546,968 76,161,264 77,738,575 79,278,922

Income Tax 12% 6,736,974 5,853,277 7,160,555 8,266,511 8,528,754 8,746,283 8,945,636 9,139,352 9,328,629 9,513,471
Net profit after Tax 49,404,473 42,924,034 52,510,740 60,621,081 62,544,198 64,139,411 65,601,332 67,021,912 68,409,946 69,765,452

Page 31
 Hemer Footwear Ltd
Projected Statement of Changes in Equity

PARTICULAR Year-0 Year-1 Year-2 Year-3 Year-4 Year-5 Year-6 Year-7 Year-8 Year-9 Year-10

Attainable Capacity 80% 85% 90% 95% 95% 95% 95% 95% 95% 95%

Share Capital 114,358,507 120,433,894 121,133,116 121,547,235 121,958,817 122,037,854 122,071,452 122,105,622 122,140,726 122,176,790 122,213,842

Retained Earnings
Opening Balance - 49,404,473 92,328,507 144,839,247 205,460,328 268,004,526 332,143,937 397,745,269 464,767,181 533,177,127

Add, Net Profit after Tax 49,404,473 42,924,034 52,510,740 60,621,081 62,544,198 64,139,411 65,601,332 67,021,912 68,409,946 69,765,452

Closing Balance 49,404,473 92,328,507 144,839,247 205,460,328 268,004,526 332,143,937 397,745,269 464,767,181 533,177,127 602,942,579

Total Equity 114,358,507 169,838,367 213,461,623 266,386,481 327,419,144 390,042,380 454,215,388 519,850,891 586,907,907 655,353,917 725,156,420

Page 32
 Hemer Footwear Ltd
Projected Statement of Cash Flow

PARTICULAR 0 Year 1st Year 2nd Year 3rd Year 4th Year 5th Year 6th Year 7th Year 8th Year 9th Year 10th Year

Cash Flows from Operating Activities

Net Income after Tax - 49,404,473 42,924,034 52,510,740 60,621,081 62,544,198 64,139,411 65,601,332 67,021,912 68,409,946 69,765,452

Add : Non cash Expenses - - - - -

Depreciation & Amortization 15,530,929 15,530,929 15,530,929 15,530,929 15,530,929 15,530,929 15,530,929 15,530,929 15,530,929 15,530,929

Financial Expense 8,707,059 27,593,463 24,756,551 21,919,031 18,976,647 16,023,358 13,070,206 10,117,279 7,164,582 4,212,122

Increase in Working Capital (30,376,937) (3,496,112) (2,070,591) (2,057,910) (395,189) (167,986) (170,852) (175,518) (180,322) (185,258)

Net Cash Flows from operating Activities - ########## 82,552,314 90,727,629 96,013,131 96,656,586 95,525,712 94,031,615 92,494,602 90,925,135 89,323,245

Cash Flow from Investing Activities

Acquisition of Fixed assets 286,017,666 - - - - -

Other Income - - - - - - - - - -

Net Cash Flows from Investing Activities 286,017,666 - - - - - - - - - -

Cash Flows From Financing Activities

Shareholders Equity 114,358,507

Long Term Loan from Bank (excl. PDCP) 171,659,159 - - - - - - - - - -

Equity Contribution in WC 6,075,387 699,222 414,118 411,582 79,038 33,597 34,170 35,104 36,064 37,052

Short Term Loan (Working Capital) 24,301,550 2,796,889 1,656,473 1,646,328 316,151 134,389 136,682 140,415 144,257 148,206

Payment of Financial expense (8,707,059) (27,593,463) (24,756,551) (21,919,031) (18,976,647) (16,023,358) (13,070,206) (10,117,279) (7,164,582) (4,212,122)

Dividend payment - - - - - - - -

Re-payment of Long Term Loan (5,694,909) (22,779,634) (22,779,634) (22,779,634) (22,779,634) (22,779,634) (22,779,634) (22,779,634) (22,779,634) (22,779,634)
Net Cash Flows from Financing Activities 286,017,666 15,974,969 (46,876,985) (45,465,594) (42,640,755) (41,361,092) (38,635,006) (35,678,989) (32,721,395) (29,763,895) (26,806,499)

Increase / Decrese of Cash & Cash Equivalent

- 59,240,493 35,675,329 45,262,035 53,372,376 55,295,493 56,890,706 58,352,627 59,773,207 61,161,241 62,516,746
during the period
Cash & Cash Equivalent at the beginning of the
- - 59,240,493 94,915,822 140,177,857 193,550,233 248,845,726 305,736,431 364,089,058 423,862,265 485,023,506
period
Cash & Cash Equivalent at the End of the
- 59,240,493 94,915,822 140,177,857 193,550,233 248,845,726 305,736,431 364,089,058 423,862,265 485,023,506 547,540,253
period

Page 33
 Hemer Footwear Ltd
Projected Statement of Financial Position

Particulars Year-0 Year-1 Year-2 Year-3 Year-4 Year-5 Year-6 Year-7 Year-8 Year-9 Year-10

Fixed Assets 267,917,666 256,551,983 245,186,299 233,820,616 222,454,933 211,089,249 199,723,566 188,357,883 176,992,200 165,626,516 154,260,833
Fixed Assets 267,917,666 267,917,666 267,917,666 267,917,666 267,917,666 267,917,666 267,917,666 267,917,666 267,917,666 267,917,666 267,917,666
Accumulated Depreciation (11,365,683) (22,731,367) (34,097,050) (45,462,733) (56,828,416) (68,194,100) (79,559,783) (90,925,466) (102,291,150) (113,656,833)

Intengible Assets 41,652,459 37,487,213 33,321,967 29,156,721 24,991,475 20,826,229 16,660,983 12,495,738 8,330,492 4,165,246
Prelimanery & Pre-operating Exp. 2,600,000 2,340,000 2,080,000 1,820,000 1,560,000 1,300,000 1,040,000 780,000 520,000 260,000
Deferred Expenses (IDCP) 39,052,459 35,147,213 31,241,967 27,336,721 23,431,475 19,526,229 15,620,983 11,715,738 7,810,492 3,905,246

Current Assets 15,500,000 118,573,624 158,477,191 206,543,683 262,709,617 318,475,241 375,610,748 434,212,962 494,242,392 555,666,676 618,453,469
Cash & Bank Balance 59,240,493 94,915,822 140,177,857 193,550,233 248,845,726 305,736,431 364,089,058 423,862,265 485,023,506 547,540,253
Inventory -Raw & Packing Material 10,672,569 11,103,776 11,752,790 12,401,805 12,401,805 12,401,805 12,401,805 12,401,805 12,401,805 12,401,805
- Work-in- Process 1,964,315 2,081,901 2,199,719 2,317,776 2,333,596 2,348,770 2,364,347 2,380,339 2,396,757 2,413,612
- Finished Goods 15,943,666 16,990,447 17,874,066 18,759,473 18,887,248 19,001,108 19,117,903 19,237,807 19,360,904 19,487,279
- Accounts Receivables 14,520,124 16,896,984 17,795,171 18,680,418 18,875,839 18,990,942 19,107,475 19,227,101 19,349,913 19,475,995
- Stores & Spares 732,458 988,261 1,244,079 1,499,913 1,631,028 1,631,694 1,632,375 1,633,074 1,633,791 1,634,525
Other Current Assets 15,500,000 15,500,000 15,500,000 15,500,000 15,500,000 15,500,000 15,500,000 15,500,000 15,500,000 15,500,000 15,500,000
Total Assets 325,070,125 412,612,820 436,985,457 469,521,020 510,156,025 550,390,720 591,995,298 635,066,583 679,565,083 725,458,438 772,714,302

FINANCED BY:

Owners Equity 114,358,507 169,838,367 213,461,623 266,386,481 327,419,144 390,042,380 454,215,388 519,850,891 586,907,907 655,353,917 725,156,420
Share Capital 114,358,507 120,433,894 121,133,116 121,547,235 121,958,817 122,037,854 122,071,452 122,105,622 122,140,726 122,176,790 122,213,842
Retained Earnings 49,404,473 92,328,507 144,839,247 205,460,328 268,004,526 332,143,937 397,745,269 464,767,181 533,177,127 602,942,579

Long Term Liability 210,711,618 205,016,709 182,237,075 159,457,441 136,677,806 113,898,172 91,118,538 68,338,903 45,559,269 22,779,634
Long Term Loan - Local 210,711,618 205,016,709 182,237,075 159,457,441 136,677,806 113,898,172 91,118,538 68,338,903 45,559,269 22,779,634 (0)

Current Liabilities 37,757,744 41,286,759 43,677,098 46,059,075 46,450,168 46,661,372 46,876,789 47,097,907 47,324,886 47,557,881
Packing Credit & Overdraft 24,301,550 27,098,439 28,754,912 30,401,240 30,717,391 30,851,780 30,988,462 31,128,876 31,273,134 31,421,340
Accounts Payable 10,020,969 10,647,279 11,273,590 11,899,900 11,899,900 11,899,900 11,899,900 11,899,900 11,899,900 11,899,900
Accrued Expenses 3,435,225 3,541,041 3,648,596 3,757,935 3,832,876 3,909,691 3,988,427 4,069,130 4,151,852 4,236,641

Total Equity & Liabilities 325,070,125 412,612,820 436,985,457 469,521,020 510,156,025 550,390,720 591,995,298 635,066,583 679,565,083 725,458,438 772,714,302

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 Hemer Footwear Ltd
Fixed Asset Schedule

Accounting Depreciation
Depreciation
SL
Particulars Value Dep Rate
No. Year -01 Year -02 Year -03 Year -04 Year -05 Year -06 Year -07 Year -08 Year -09 Year -10

1 Land and Land development 54,432,000 0% - - - - - - - - - -

2 Building & Civil Construction 13,387,900 5% 669,395 669,395 669,395 669,395 669,395 669,395 669,395 669,395 669,395 669,395

3 Machinery cost-Foreign 159,866,520 5% 7,993,326 7,993,326 7,993,326 7,993,326 7,993,326 7,993,326 7,993,326 7,993,326 7,993,326 7,993,326

4 C&F for Importable Machinery 4,795,996 5% 239,800 239,800 239,800 239,800 239,800 239,800 239,800 239,800 239,800 239,800

5 Machinery cost-Local 16,886,000 5% 844,300 844,300 844,300 844,300 844,300 844,300 844,300 844,300 844,300 844,300

6 Machinery Erection & Installation 4,721,250 5% 236,063 236,063 236,063 236,063 236,063 236,063 236,063 236,063 236,063 236,063

7 Furniture, Fixture & Office Equipments 5,268,000 10% 526,800 526,800 526,800 526,800 526,800 526,800 526,800 526,800 526,800 526,800

8 Transport & Vehicles 8,560,000 10% 856,000 856,000 856,000 856,000 856,000 856,000 856,000 856,000 856,000 856,000

Sub-Total 267,917,666 11,365,683 11,365,683 11,365,683 11,365,683 11,365,683 11,365,683 11,365,683 11,365,683 11,365,683 11,365,683

Cumulative Depreciation 11,365,683 22,731,367 34,097,050 45,462,733 56,828,416 68,194,100 79,559,783 90,925,466 102,291,150 113,656,833

Preliminary & Pre-operating Expenses 2,600,000 10% 260,000 260,000 260,000 260,000 260,000 260,000 260,000 260,000 260,000 260,000

Interest During Construction Period(IDCP)

39,052,459 10% 3,905,246 3,905,246 3,905,246 3,905,246 3,905,246 3,905,246 3,905,246 3,905,246 3,905,246 3,905,246

Sub-Total 41,652,459 4,165,246 4,165,246 4,165,246 4,165,246 4,165,246 4,165,246 4,165,246 4,165,246 4,165,246 4,165,246

Total 309,570,125 15,530,929 15,530,929 15,530,929 15,530,929 15,530,929 15,530,929 15,530,929 15,530,929 15,530,929 15,530,929

Cumulative Depreciation 15,530,929 31,061,858 46,592,788 62,123,717 77,654,646 93,185,575 108,716,504 124,247,433 139,778,363 155,309,292

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 Hemer Footwear Ltd
Net Present Value (NPV) & Internal Rate of Return (IRR)

Particulars Year - 01 Year - 02 Year - 03 Year - 04 Year - 05 Year - 06 Year - 07 Year - 08 Year - 09 Year - 10

Capacity Utilization 80% 85% 90% 95% 95% 95% 95% 95% 95% 95%

Net Profit 49,404,473 42,924,034 52,510,740 60,621,081 62,544,198 64,139,411 65,601,332 67,021,912 68,409,946 69,765,452
Depriciation 15,530,929 15,530,929 15,530,929 15,530,929 15,530,929 15,530,929 15,530,929 15,530,929 15,530,929 15,530,929

Total Cash Inflow 64,935,402 58,454,963 68,041,669 76,152,010 78,075,128 79,670,340 81,132,261 82,552,842 83,940,875 85,296,381

Cash Cash Net Cash PV of Tk PV of Cash

Year
outflow inflows flows 1.00 at 9% flows

0 (286,017,666) - (286,017,666) 1.000 (286,017,666)

1 64,935,402 64,935,402 0.917 59,573,763
2 58,454,963 58,454,963 0.842 49,200,373
3 68,041,669 68,041,669 0.772 52,540,653
4 76,152,010 76,152,010 0.708 53,948,004
5 78,075,128 78,075,128 0.650 50,743,476
6 79,670,340 79,670,340 0.596 47,504,821
7 81,132,261 81,132,261 0.547 44,382,125
8 82,552,842 82,552,842 0.502 41,430,487
9 83,940,875 83,940,875 0.460 38,648,711
10 85,296,381 85,296,381 0.422 36,030,113
(286,017,666) 758,251,871 472,234,205
Net Present Value ( NPV ) 187,984,860
Internal Rate of Return ( IRR ) 21.40%
Assumptions:
1. Construction period of the project is 21 months
2. The economic life of the project has been estimated to be 10 years without any major replacement.

4. Inventories of the project has been estimated as follows:

Description 1st Year 2nd Year 3rd Year Total
Inventory 19,292,038 20,734,396 22,027,138 62,053,572

5. Benefit of the Project has been estimated as under

Dep & Total
Year Net Profit
Amortize Benefit
1 49,404,473 15,530,929 64,935,402
2 42,924,034 15,530,929 58,454,963
3 52,510,740 15,530,929 68,041,669

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 Hemer Footwear Ltd
Pay Back Period Calculation

Particulars Year - 01 Year - 02 Year - 03 Year - 04 Year - 05 Year - 06 Year - 07 Year - 08 Year - 09 Year - 10

Capacity Utilization 80% 85% 90% 95% 95% 95% 95% 95% 95% 95%

Net Profit 49,404,473 42,924,034 52,510,740 60,621,081 62,544,198 64,139,411 65,601,332 67,021,912 68,409,946 69,765,452
Depreciation 15,530,929 15,530,929 15,530,929 15,530,929 15,530,929 15,530,929 15,530,929 15,530,929 15,530,929 15,530,929

Total Cash Inflow 64,935,402 58,454,963 68,041,669 76,152,010 78,075,128 79,670,340 81,132,261 82,552,842 83,940,875 85,296,381

PV of Cash flows 59,573,763 49,200,373 52,540,653 53,948,004 50,743,476 47,504,821 44,382,125 41,430,487 38,648,711 36,030,113

Discounted Recovery of Initial Outlay Payback

Year Cash Flow
Needed Balance Year

1 59,573,763 286,017,666 226,443,903 1.00

2 49,200,373 226,443,903 177,243,530 1.00
3 52,540,653 177,243,530 124,702,877 1.00
4 53,948,004 124,702,877 70,754,873 1.00
5 50,743,476 70,754,873 20,011,397 1.00
6 47,504,821 20,011,397 0.42
7 44,382,125
8 41,430,487
9 38,648,711
10 36,030,113

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 Hemer Footwear Ltd
Break - Even Analysis

Particulars Year-3 Year-4 Year-5 Year-6 Year-7 Year-8 Year-9 Year-10

Capacity Utilization 90% 95% 95% 95% 95% 95% 95% 95%

Sales 288,870,725 305,205,059 306,829,659 306,976,787 306,989,948 306,991,123 306,991,228 306,991,237

Variable Cost:
Raw Materials 126,264,207 133,278,885 133,278,885 133,278,885 133,278,885 133,278,885 133,278,885 133,278,885
Packing Materials 8,109,360 8,515,080 8,515,080 8,515,080 8,515,080 8,515,080 8,515,080 8,515,080
Power & Fuel 13,003,383 13,725,794 13,725,794 14,137,567 14,561,694 14,998,545 15,448,502 15,911,957
Repair, Maintenance, Stores and Spares 4,644,562 5,599,675 6,089,172 6,091,656 6,094,201 6,096,811 6,099,485 6,102,227
Total Variable Cost: 152,021,512 161,119,433 161,608,931 162,023,188 162,449,861 162,889,321 163,341,952 163,808,148
W.I.P Adjustment (117,819) (118,057) (15,820) (15,174) (15,577) (15,992) (16,418) (16,855)
Finished Goods Adjustment (Excl.Depre) (494,827) (495,828) (71,554) (63,762) (65,405) (67,146) (68,934) (70,770)
Net Variable Cost 151,408,867 160,505,548 161,521,557 161,944,253 162,368,878 162,806,182 163,256,600 163,720,523

Contribution Margin 137,461,858 144,699,510 145,308,102 145,032,534 144,621,070 144,184,941 143,734,628 143,270,714

Fixed Cost:
Salaries & Wages 32,754,915 33,573,788 34,413,133 35,273,461 36,155,298 37,059,180 37,985,660 38,935,301
Administrative & Marketing Overhead 8,025,666 8,229,800 8,438,958 8,438,958 8,438,958 8,438,958 8,438,958 8,438,958
Depreciation & Amortization 15,530,929 15,530,929 15,530,929 15,530,929 15,530,929 15,530,929 15,530,929 15,530,929
Financial Expenses 24,756,551 21,919,031 18,976,647 16,023,358 13,070,206 10,117,279 7,164,582 4,212,122
Total Fixed Cost 81,068,062 79,253,548 77,359,667 75,266,706 73,195,391 71,146,346 69,120,128 67,117,310

Break-Even % (on used capacity) 58.97% 54.77% 53.24% 51.90% 50.61% 49.34% 48.09% 46.85%
Cash Break-Even % (on used capacity) 47.68% 44.04% 42.55% 41.19% 39.87% 38.57% 37.28% 36.01%
Break-Even Sales - 170,361,366 167,164,241 163,351,113 159,309,990 155,373,275 151,481,122 147,628,121 143,814,638

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 Hemer Footwear Ltd
Key Financial Indicators

Particulars 0 - Year Year - 01 Year - 02 Year - 03 Year - 04 Year - 05 Year - 06 Year - 07 Year - 08 Year - 09 Year - 10

Capacity Utilization - 80% 85% 90% 95% 95% 95% 95% 95% 95% 95%
a) Operating result:
Sales - 232,778,115 270,736,101 288,870,725 305,205,059 306,829,659 306,976,787 306,989,948 306,991,123 306,991,228 306,991,237
Gross profit - 72,480,506 84,197,236 92,453,513 99,036,422 98,488,557 97,348,010 96,056,132 94,717,500 93,342,114 91,930,001
Operating profit - 64,848,506 76,370,774 84,427,846 90,806,622 90,049,600 88,909,052 87,617,175 86,278,543 84,903,157 83,491,044
Net profit before tax - 56,141,446 48,777,312 59,671,295 68,887,592 71,072,953 72,885,694 74,546,968 76,161,264 77,738,575 79,278,922
Net profit after tax - 49,404,473 42,924,034 52,510,740 60,621,081 62,544,198 64,139,411 65,601,332 67,021,912 68,409,946 69,765,452
b) Profitability ratio:
Gross profit ratio - 31.14% 31.10% 32.01% 32.45% 32.10% 31.71% 31.29% 30.85% 30.41% 29.95%
Operating profit ratio - 27.86% 28.21% 29.23% 29.75% 29.35% 28.96% 28.54% 28.10% 27.66% 27.20%
Net profit before tax ratio - 24.12% 18.02% 20.66% 22.57% 23.16% 23.74% 24.28% 24.81% 25.32% 25.82%
Net profit after tax ratio - 21.22% 15.85% 18.18% 19.86% 20.38% 20.89% 21.37% 21.83% 22.28% 22.73%
Return on Equity ( ROE ) - 34.77% 22.40% 21.89% 20.42% 17.43% 15.19% 13.47% 12.11% 11.01% 10.11%
Return on total Investment ( ROI ) - 13.39% 10.10% 11.59% 12.38% 11.79% 11.23% 10.69% 10.20% 9.74% 9.31%
c) Solvency ratio:
Debt #REF! 59% 51% 43% 36% 29% 23% 18% 14% 10% 6%
Equity #REF! 41% 49% 57% 64% 71% 77% 82% 86% 90% 94%
Debt-Equity Ratio 65%-35% 57%-43% 50%-50% 41%-59% 34%-66% 27%-73% 21%-79% 16%-84% 12%-88% 8%-92% 4%-96%
Debt sevice coverage ratio (times) - 11.74 3.60 4.43 5.42 6.34 7.63 9.61 13.10 20.87 53.50
d) Other Indicators:
Break-Even % (on used capacity) - 58.97%
Break-Even Sales - - $170,361,366

Internal Rate of Return ( IRR ) - 21.40%

Net Present Value ( NPV ) USD '000' - $187,984,860
Pay Back Period ( PBP ) - 5.42 years

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