Business Prospects of Manufacturing Spices in Maharashtra

 



Best Business Opportunities in Maharashtra

 

Maharashtra occupies an important place in the production sector. It is one of the fore-running industrial states constituting 13% of the industrial output in the nation. Around 46% of the Gross State Domestic Product (GSDP) comes from the industry. Spices are grown abundantly in the state of Maharashtra. The single ingredient spices are equally popular as blended spices. Because Maharashtrian cuisine is hugely dependent on flavours and spices. However, the opportunity for spice market is not limited to seasoning, flavouring, colouring, and pungency. As spices can also be used for food preservation, storage pesticide, and medicinal purposes owing to its antioxidant and antimicrobial properties.

 

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Cumin powder, turmeric powder, coriander powder, black pepper powder, garam masala powder, dill seed powder, cardamom powder, and curry powder are some of the spices popularly consumed in Maharashtra. The state is also well-known for its ‘goda masala’. The uniqueness of the state is that the culinary practices differ from region to region. It could range from pure vegetarian Brahmin delicacies sans ‘garlic’ & ‘onion’ to Kolhapuri cuisine, non-vegetarian cuisine, and Malvani cuisine where the dishes primarily consist of sea-food.

 

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The area under spices cultivation is about 1.66 lakh/ha and the manufacturing of spices is approximately 14 lakh metric tonnes. As per projections, about 3 lakh hectares of land would be allocated for the cultivation of spices in the state, and the production is expected to reach 30 metric tonnes/ha. The Maharashtrian condiments and spices contributed about INR 33.44 billion to the Indian economy in the year 2018, indicating a slight increase relative to the previous financial year. The spices sector contributed 4.7% to the Indian GVA (Gross Value Added) in the same year.

 

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Turmeric, Ginger, Black-pepper, Chillies, and Cardamom are the commonly cultivated spices in the state. The coastal belt (Konkan) and the western region of Maharashtra are favourable for growing spices and turmeric respectively. The companies that sell spices tend to conduct extensive market research and deploy it as a vital input for developing a new product. The spices manufacturing units in Maharashtra have initiated cutting-edge technology. The units are now completely automatic with advanced processing and inspection techniques. To ensure adequate hygiene, the packaging of spices and condiments is also merchandised.

The spice market is hugely unorganized and the branded segment constitutes about 15%. The spice market in India is estimated to climb about 18 billion US dollars by the year 2020 with growth in the sector expected to be led by spice mixes and branded spices. Overall, India exports around 52 various spices. The government of India is extensively facilitating the export of spices by implementing various schemes such as the establishment of spice parks, offering common manufacturing facilities to manufacturers and exporters.

 

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Considering the huge demand for spices, large-scale availability of raw spices, government schemes, and high-end techniques; establishing Research & Development (R&D) units to manufacture spices would prove to be a lucrative venture. Raw spices can be procured upon a stringent selection process from reputed suppliers within India and across the globe. The processing of spices can be carried out in unique customized plants designed exclusively for the company. The R&D department can closely work with the procurement, production, and marketing functions to ensure the supply of quality products.

 

NPCS is one of the influential brands in the industrial world offering consolidated technical consultations. Having explored the market for, ‘Prospects of manufacturing spices in Maharashtra’, executing the same would be a beneficial venture.

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Ø  Introduction

·         Project Introduction

·         Project Objective and Strategy

·         Concise History of the Product

·         Properties

·         BIS (Bureau of Indian Standards) Provision & Specification

·         Uses & Applications

 

Ø  Market Study and Assessment

·         Current Indian Market Scenario

·         Present Market Demand and Supply

·         Estimated Future Market Demand and Forecast

·         Statistics of Import & Export

·         Names & Addresses of Existing Units (Present Players)

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Ø  Plant and Machinery

·         List of Plant & Machinery

·         Miscellaneous Items

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·         Laboratory Equipments & Accessories

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Project at a Glance

Along with financial details as under:

 

  •     Assumptions for Profitability workings

  •    Plant Economics

  •    Production Schedule

  •    Land & Building

            Factory Land & Building

            Site Development Expenses

  •    Plant & Machinery

             Indigenous Machineries

            Other Machineries (Miscellaneous, Laboratory etc.)

  •    Other Fixed Assets

            Furniture & Fixtures

            Pre-operative and Preliminary Expenses

            Technical Knowhow

            Provision of Contingencies

  •   Working Capital Requirement Per Month

             Raw Material

            Packing Material

            Lab & ETP Chemical Cost

           Consumable Store

  •   Overheads Required Per Month And Per Annum

         Utilities & Overheads (Power, Water and Fuel Expenses etc.)

             Royalty and Other Charges

            Selling and Distribution Expenses

  •    Salary and Wages

  •    Turnover Per Annum

  •   Share Capital

            Equity Capital

            Preference Share Capital

 

  •    Annexure 1:: Cost of Project and Means of Finance

  •    Annexure 2::  Profitability and Net Cash Accruals

                Revenue/Income/Realisation

                Expenses/Cost of Products/Services/Items

                Gross Profit

                Financial Charges     

                Total Cost of Sales

                Net Profit After Taxes

                Net Cash Accruals

  •   Annexure 3 :: Assessment of Working Capital requirements

                Current Assets

                Gross Working. Capital

                Current Liabilities

                Net Working Capital

                Working Note for Calculation of Work-in-process

  •    Annexure 4 :: Sources and Disposition of Funds

  •    Annexure 5 :: Projected Balance Sheets

                ROI (Average of Fixed Assets)

                RONW (Average of Share Capital)

                ROI (Average of Total Assets)

  •    Annexure 6 :: Profitability ratios

                D.S.C.R

                Earnings Per Share (EPS)

               

             Debt Equity Ratio

        Annexure 7   :: Break-Even Analysis

                Variable Cost & Expenses

                Semi-Var./Semi-Fixed Exp.

                Profit Volume Ratio (PVR)

                Fixed Expenses / Cost 

                B.E.P

  •   Annexure 8 to 11:: Sensitivity Analysis-Price/Volume

            Resultant N.P.B.T

            Resultant D.S.C.R

   Resultant PV Ratio

   Resultant DER

  Resultant ROI

          Resultant BEP

  •    Annexure 12 :: Shareholding Pattern and Stake Status

        Equity Capital

        Preference Share Capital

  •   Annexure 13 :: Quantitative Details-Output/Sales/Stocks

        Determined Capacity P.A of Products/Services

        Achievable Efficiency/Yield % of Products/Services/Items 

        Net Usable Load/Capacity of Products/Services/Items   

       Expected Sales/ Revenue/ Income of Products/ Services/ Items   

  •    Annexure 14 :: Product wise domestic Sales Realisation

  •    Annexure 15 :: Total Raw Material Cost

  •    Annexure 16 :: Raw Material Cost per unit

  •    Annexure 17 :: Total Lab & ETP Chemical Cost

  •    Annexure 18  :: Consumables, Store etc.,

  •    Annexure 19  :: Packing Material Cost

  •    Annexure 20  :: Packing Material Cost Per Unit

  •    Annexure 21 :: Employees Expenses

  •    Annexure 22 :: Fuel Expenses

  •    Annexure 23 :: Power/Electricity Expenses

  •    Annexure 24 :: Royalty & Other Charges

  •    Annexure 25 :: Repairs & Maintenance Exp.

  •    Annexure 26 :: Other Mfg. Expenses

  •    Annexure 27 :: Administration Expenses

  •    Annexure 28 :: Selling Expenses

  •    Annexure 29 :: Depreciation Charges – as per Books (Total)

  •   Annexure 30   :: Depreciation Charges – as per Books (P & M)

  •   Annexure 31   :: Depreciation Charges - As per IT Act WDV (Total)

  •   Annexure 32   :: Depreciation Charges - As per IT Act WDV (P & M)

  •   Annexure 33   :: Interest and Repayment - Term Loans

  •   Annexure 34   :: Tax on Profits

  •   Annexure 35   ::Projected Pay-Back Period And IRR