PANEER

1. Introduction
Paneer is the precipitated milk solids. It is commonly prepared after
skimming the milk. Fresh paneer is used in most households as an addition in
vegetarian and non vegetarian dishes. It is consumed abundantly by eating
houses for preparation of various recipes, as dished containing paneer are the
most sought after. Paneer is highly nutritive and a rich source of protein.
2. Market
The major market outlets are the A and B class stores. The product
also finds placement in self service counters and departmental stores.
3. Packaging
Paneer are packed in 100 grams packaging and multiples thereof.
4. Production capacity
The plant will be in operation for one shift a day.
The production capacity is estimated at processing 500 litres of milk per day
yielding 40 kilograms of paneer.
The yield of Paneer will be 1 tonne per month and that per annum would be
12 metric tonnes.
The time period required for achieving full capacity utilization is one year.
5. Sales revenue
Good quality milk can be procured at Rs. 16 per litre. The resulting cream
and paneer can be sold each at Rs. 220 per kilogram. MRP is Rs. 240 per
kilogram
The yield of cream per annum would be 4500 kilograms and the sales
revenue would be Rs. 9.90 lakhs.
The yield of paneer which is 12 metric tonnes would provide a sales revenue
of Rs. 26.40 lakhs.
The total sales revenue will be Rs. 36.30 lakhs.

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6. Production process outline.
Milk is first skimmed in a cream separator. Skimmed milk is heated to
about 60 degrees centigrade. It is then split by addition of a few drops of lime
extract or citric acid. The coagulated mass is filtered through a muslin cloth and
filter press when the cake is obtained. It is sliced manually to the desired
weights, packed in wax paper and stored under refrigerated conditions.
7. Quality specifications
The product should be free from any fermented odour.
The product should not contain any added starches.
The product should be prepared under hygienic conditions and should be
free from coliforms, salmonella and streptococci bacteria.
8. Pollution control measures
Not necessary as there are no pollutants or effluents.
9. Energy conservation measures
Common measures will do.
10. Land and construction cost for the proposed unit
The proposed unit is to be set up in a leased area. The total area required
is 1000 square feet as described below:
Sl Description Sq. feet
1 Processing area 400
2 Milk store room 100
3 Packing material store 100
4 Finished goods store 100
5 Washing area 100
6 Toilets 100
7 Administrative office 100
8 Total 1000

Lease rent Rs. 8.00 per square foot

Total rent per month Rs. 8000
Lease advance Rs. 50000

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11. Costing of machinery and equipment
Sl Description Rs. lakhs
1 Aluminum cans for storage of milk 0.500
2 Stainless steel precipitation tank 0.300
3 Filter press manual 0.100
4 Deep freezer 0.350
5 Weighing scales electronic 2 nos 0.150
6 Cream separator 0.250
7 Stainless steel vessels 4 nos 0.500
8 Total cost of plant machinery 2.150
9 Laboratory equipment 0.200
10 Total cost of machinery and equipment 2.350

12. Project cost

Sl Description Rs. lakhs
1 Land On lease
2 Civil works On lease
3 Plant machinery 2.150
4 Laboratory equipment 0.200
5 Transport vehicle ( Tata Ace) 3.750
6 Pollution control equipment 0.000
7 Energy conservation equipment 0.000
8 Cost of power connection 0.050
9 Cost of electrification 0.200
10 Erection and commissioning 0.200
11 Cost of machinery spares 0.010
12 Cost of office equipment 1.000
13 Deposits if any 0.200
14 Company formation expenses 0.100
15 Gestation period expenses 0.500
16 Sales tax registration expenses 0.100
17 Initial advertisement and publicity 2.000
18 Contingencies 0.250
19 Working capital margin money 1.000
20 Total 11.710

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13. Working capital requirements per month
a. Salaries and wages
Sl Description No of Total
persons salary /
month
(Rs. lakhs)
1 Production Manager 1 0.100
2 Skilled worker 1 0.060
3 Unskilled worker 2 0.060
4 Total 4 0.220

b. Raw material requirement per month

Sl Description Qty Rate / kg Value
(kgs) (Rs) (Rs. lakhs)
1 Milk 12500 16.00 2.000
2 Sodium hypochlorite 25 15.00 0.004
3 Total raw material 12525 2.004

c. Packaging material requirement per month

Sl Description Qty Rate / unit Value
Rs) (Rs. lakhs)
1 Primary packaging 5000 nos 0.25 0.012
material butter paper
2 Cartons and straps 400 nos 25 0.100
3 Total 0.112
Total raw + packaging material = Rs. 2.116 lakhs

d. Utilities per month

Sl Description Rs. lakhs
1 Power 200kwh @ Rs. 5.50 per unit 0.011
2 Water 0.010
3 Boiler fuel 0.000
4 Total utilities 0.021

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e. Contingent expenses per month
Sl Description Rs. lakhs
1 Rent for processing shed 0.080
2 Postage and stationery 0.010
3 Telephones, fax etc. 0.050
4 Consumable stores 0.010
5 Repairs and maintenance 0.010
6 Local transports, loading and unloading 0.100
7 Sales expenses @ 1% of sales 0.030
8 Total contingent expenses 0.290

f. Total working capital requirement per month

Sl Description Rs. lakhs
1 Salaries and wages 0.220
2 Raw material and packaging material 2.116
3 Utilities 0.021
4 Contingent expenses 0.290
5 Total 2.647

14. Means of finance

Sl Description Rs. lakhs
1 Total Project Cost 11.710
2 Equity 3.903
3 Debt 7.807
4 Working capital margin money 1.000

15. Financial analysis

Sl Description Rs. lakhs
1 Total recurring cost per year 31.764
2 Depreciation on land and building 0.000
3 Depreciation on machinery and vehicle 0.615
4 Depreciation on moulds and fixtures 0.010
5 Depreciation on office equipment 0.100
6 Interest on long term loan @ 12% 0.937
7 Interest on short term borrowings@ 12% 0.198
8 Total cost of production 33.624

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16. Turnover per year

Sl Item Qty Rate/unit Total

(Rs) Rs. lakhs
1 Cream 4500 kgs 220 9.90
2 Paneer 12000 kgs 220 26.40
3 Total 16500 kgs 36.30

17. Viability analysis

Sl Description Value
1 Net profit before income tax (Rs. lakhs) 2.676
2 Net profit ratio 7.4%
3 Internal rate of return 17.6%
4 Break even percentage 56%
5 Debt service coverage ratio 1.836

List of machinery suppliers for paneer

Machinery has to be fabricated locally as per requirements. There are no
standard machinery available.