The document outlines the projected costs and financial analysis of a software house project. It estimates total project costs of Rs. 16.24 million, to be financed equally through equity investment and bank debt. The net present value is calculated to be Rs. 19.90 million with an internal rate of return of 36.48% and payback period of 3.79 years. Projected financial statements and cash flows over 10 years show increasing revenues, profits, and positive cash balances.
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The document outlines the projected costs and financial analysis of a software house project. It estimates total project costs of Rs. 16.24 million, to be financed equally through equity investment and bank debt. The net present value is calculated to be Rs. 19.90 million with an internal rate of return of 36.48% and payback period of 3.79 years. Projected financial statements and cash flows over 10 years show increasing revenues, profits, and positive cash balances.
The document outlines the projected costs and financial analysis of a software house project. It estimates total project costs of Rs. 16.24 million, to be financed equally through equity investment and bank debt. The net present value is calculated to be Rs. 19.90 million with an internal rate of return of 36.48% and payback period of 3.79 years. Projected financial statements and cash flows over 10 years show increasing revenues, profits, and positive cash balances.
Copyright:
Attribution Non-Commercial (BY-NC)
Available Formats
Download as XLS, PDF, TXT or read online from Scribd
The document outlines the projected costs and financial analysis of a software house project. It estimates total project costs of Rs. 16.24 million, to be financed equally through equity investment and bank debt. The net present value is calculated to be Rs. 19.90 million with an internal rate of return of 36.48% and payback period of 3.79 years. Projected financial statements and cash flows over 10 years show increasing revenues, profits, and positive cash balances.
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SOFTWARE HOUSE PROJECT COST
PROJECT COST Rs.
CAPITAL INVESTMENT: EQUIPMENT 3,332,500 FURNITURE & FIXTURE 1,887,000 MOTOR VEHICLES 3,265,000 PROJECT DEVELOPMENT COST 8,484,500 COPY RIGHTS-LICENSING & TRADE MARKS 161,500 OTHER EXPENSES 874,000 PRELIMINARY EXPENSE 1,035,500 CAPITAL INVESTMENT 9,520,000
WORKING CAPITAL: CURRENT ASSETS RECEIVABLES 5,692,960 ADVANCES TO EMPLOYEES 2,000,455 TOTAL CURRENT ASSETS 7,693,415
CURRENT LIABILITIES UTILITIES PAYABLE 73,744 SALARY PAYABLE 895,000 TOTAL CURRENT LIABILITIES 968,744 NET WORKING CAPITAL 6,724,671 USE PROJECT COST PROJECT DETAILS RS. TOTAL PROJECT COST 16,244,671 PROJECT FINANCES STRATEGY EQUITY (SPONSOR) --- 50% 8,122,335.5 DEBT (BANK) --- 50 % 8,122,335.5 NPV PKR 19,895,711.27 IRR 36.48% PBP (YEARS) 3.79 WACC 14.17%
Profit before Tax and Interest 3,779,273 6,333,853 12,184,430 9,598,845
Interest on Long term Loan 1,288,744 1,245,425 1,202,106 1,158,786 Interest on short term Loan 941,454 941,454 0 0 Profit / (Loss) before Tax 1,549,075 4,146,974 10,982,324 8,440,059 Taxation 187,868 1,291,703 2,712,506 2,111,832 Profit after Tax 1,361,207 2,855,271 8,269,818 6,328,227
Projected Cash Flows
Year1 Year2 Year3 Year4 INCREASE/(DECREASE) IN WORKING CAPITAL 6,724,670 985,580 722,718 1,507,645 NET INCREASE/(DECREASE) 2,912,488 9,731,213 1,628,927 2,495,534 OPENING BANK BALANCES 6,724,670 9,637,158 19,368,371 20,997,298 CLOSING CASH BALANCE 9,637,158 19,368,371 20,997,298 23,492,832 come Statement
1,758,741 2,006,325 1,607,497 1,738,630 1,879,323 2,030,250 10,146,003 11,552,639 8,519,231 15,074,375 14,857,836 10,663,029 23,492,832 33,638,835 45,191,474 53,710,706 68,785,081 83,642,917 33,638,835 45,191,474 53,710,705 68,785,081 83,642,917 94,305,946 PROJECT COST Rs. CAPITAL INVESTMENT PKR 9,520,000.00 NET WORKING CAPITAL PKR 6,724,671.00 SALES vs PA 140,000,000 TOTAL PROJECT COST PKR 16,244,671.00 120,000,000 100,000,000 PROJECT DETAILS RS. 80,000,000 TOTAL PROJECT COST PKR 16,244,671.00 60,000,000 PROJECT FINANCES STRATEGY 40,000,000 EQUITY (SPONSOR) --- 50% PKR 8,122,335.50 20,000,000 DEBT (BANK) --- 50 % PKR 8,122,335.50 0 NPV PKR 19,895,711.27 1 2 3 4 5 6 IRR 36.48% PBP (YEARS) 3.79 Inflation 10.00% Ks 16.34% CASH FLOWS 15,074, kd 16.00% 9,731,213 10,146,00311,552,639 8,519,231 Tax 25.00% 2,912,488 1,628,927 2,495,534 kd 12.00% PKR 0.00 PKR 1.00 PKR 2.00 PKR 3.00 PKR 4.00 PKR 5.00 PKR 6.00 PKR 7.00 PKR 8.00 WACC 14.17% Dep Mach 10.00% Dep F & V 10.00% (16,244,671) SALES vs PAT
Ks 16.34% PKR 0.00 (16,244,671) kd 16.00% PKR 1.00 2,912,488 Tax 25.00% PKR 2.00 9,731,213 kd 12.00% PKR 3.00 1,628,927 debt 50.00% PKR 4.00 2,495,534 equity 50.00% PKR 5.00 10,146,003 WACC 14.17% PKR 6.00 11,552,639 PKR 7.00 8,519,231 PKR 8.00 15,074,375 PKR 9.00 14,857,836 PKR 10.00 10,663,029
