Detailed Project Report

Citrus Lemon Juice Manufacturing Unit.

INDIAN INSTITUTE OF FOOD PROCESSING TECHNOLOGY

Ministry of Food Processing Industries, Govt. of India

Thanjavur

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 Contents
Sr. No. Topic Page
The Project at a Glance 3
1 General Overview of Citrus lemon production, Clusters, PHM and value
addition in India
1.1 Introduction 4
1.2 Origin, Distribution and Production of Citrus Lemon 4
1.3 Varieties 6
1.4 Health benefits and Nutritional Importance 7
1.5 Cultivation, Bearing & Post-Harvest Managements 11
1.6 Processing and Value Addition in India 13
2 Model Fortified Citrus lemon juice processing under FME Scheme
2.1 Location of Proposed project and land 16
2.2 Installed capacity of Fortified Citrus lemon juice processing plant 16
2.3 Raw Material requirement for The Unit 17
2.4 Manufacturing Process 17
2.5 Market Demand & supply for Fortified Citrus lemon juice 19
2.6 Marketing strategy for Citrus Lemon products 20
2.7 Detailed Project Assumptions 20
2.8 Fixed capital Investments
2.8.1 Plants and Machinery 22
2.8.2 Other Costs 22
2.9 Working Capital Requirements 23
2.10 Total Project Cost & means of finances 24
2.11 Manpower Requirements 24
2.12 Expenditure, Revenue and Profitability Analysis 25
2.13 Repayment Schedule 26
2.14 Assets depreciation 26
2.15 Financial Assessment of project 27
2.16 Break even analysis 28
2.17 Pie chart 29
2.18 Plant Layout 30
2.19 Machinery suppliers 30
3 Limitations of Model DPR & Guidelines for Entrepreneurs
3.1 Limitations of Model DPR 31
3.2 Guidelines for Entrepreneurs 32

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 Project At a Glance
1 Name of the Project Citrus lemon juice
2 Name of the entrepreneur/FPO/SHG/Cooperative
3 Nature of proposed project Proprietorship/Company/ Partnership
4 Registered office
5 Project site/location
6 Names of Partner (if partnership)
7 No of shareholders (if company/FPC)
8 Technical advisor
9 Marketing advisor/partners
150 MT/annum (70, 80 & 90% capacity utilization
Proposed project capacity in the 2nd, 3rd and 4th years’ onwards
10 respectively
11 Raw materials Citrus lemon Fruit
12 Major product outputs Fortified Citrus lemon juice
13 Total project cost (Lakhs) 34.04
Land development, building & civil construction 4.44
Machinery and equipment 23.55
Utilities (Power & water facilities) 3
Miscellaneous fixed assets 0.9
Pre-operative expenses 0.90
Contingencies 1.00
Working capital margin 0.25
14 Working capital Management (In Lakhs)
Second Year 17.44
Third Year 19.93
Fourth Year 25.62
15 Means of Finance
Subsidy grant by MoFPI (max 10 lakhs) 11.23
Promoter’s contribution (min 20%) 6.80
Term loan (45%) 15.99
16 Debt-equity ratio 2.35 : 1
17 Profit after Depreciation, Interest & Tax
2nd year 137.00
3rd year 158.68
4th year 180.33
18 Average DSCR 19.14
Benefit Cost Ratio 5.16
Term Loan Payment 7 Years with 1 year grace period
Pay Back Period for investment 2 Years

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 1 General Overview of Citrus lemon Production, Clusters, Post-
Harvest Management and Value Addition in India

1.1 Introduction

India ranks second for fruits and vegetables producer in the world
followed by China. India, during 2017-18 has produced about 97358
thousand MT fruits and 184394 thousand MT vegetables in about 6506
Thousand Ha and 10259 Thousand Ha respectively (Horticulture
statistics At a glance, 2018, MoA & FW Gol). In spite of this, the per
capita availability of fruit in India is 107 gm/day which is below the
recommended 120 gm/day. India’s share of global exports of fresh fruits
and processed fruit products is also quite meager compared to other
major fruit producers of the world (Bung, 2012). Unfortunately, fruits and
vegetables being perishable in nature get wasted to the tune of 20-30
% in the supply chain due to improper handling, transportation and poor
post-harvest management; and only 2 % of them are processed in to
value added products and the rest is consumed fresh. Lemon is the
third most important citrus fruit following orange and mandarin. Fruits of
lemon plants are appreciated for their high content of flavonoids,
vitamin C, citric acid and minerals.

1.2 Origin, Distribution and Production of Citrus lemon

Lemon (Citrus limon) is the medicinally important plant and

belongs to the family Rutaceae. Lemon is the third most important citrus
fruit following orange and mandarin. The origin of the lemon is unknown,
though lemons are thought to have first grown in Assam (a region in
northeast India), northern Burma or China. A genomic study of the
lemon indicated it was a hybrid between bitter orange (sour orange) and
citron. Citrus fruits are native to south-eastern Asia and are among the
oldest fruit crops to be domesticated by humans. They are widely grown

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 in all suitable subtropical and tropical climates and are consumed
worldwide. Citrus lemon spread all across Middle East, Europe, Africa
and as far as Americas. Lemons entered Europe near southern Italy no
later than the second century AD, during the time of Ancient Rome.
However, they were not widely cultivated. They were later introduced to
Persia and then to Iraq and Egypt around 700 AD. The lemon was first
recorded in literature in a 10th-century Arabic treatise on farming, and
was also used as an ornamental plant in early Islamic gardens. It was
distributed widely throughout the Arab world and the Mediterranean
region between 1000 and 1150. The first substantial cultivation of
lemons in Europe began in Genoa in the middle of the 15th century. The
lemon was later introduced to the Americas in 1493. It was mainly used
as an ornamental plant and for medicine. In the 19th century, lemons
were increasingly planted in Florida and California. . Total Lemon
production in India is about 3147.85 MT. Top lemon producing states
are Gujarat, Andhra Pradesh, Madhya Pradesh, Karnataka, Orissa and
Maharashtra. Gujarat contributes 20 % share of total lemon production
in India followed by Andhra Pradesh accounting for 18%, Madhya
Pradesh and Karnataka accounting for 10% of Total lemon production
in India.

Citrus lemon is the most important fruit in all over

world. It is well known for nutritional and medicinal property. All citrus
lemon is used as a traditional medicine. Citrus lemon fruit is used for
culinary and non-culinary purposes throughout the world, primarily for
its juice, which has both culinary and cleaning uses. The pulp and rind
are also used in cooking and baking. The juice of the lemon is about 5%
to 6% citric acid, with a pH of around 2.2, giving it a sour taste and which
is also rich in vitamin C and contains smaller amounts of Vitamin B,
particularly thiamine, riboflavin, and niacin.

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 1.3 Varieties

There are different varieties of Citrus lemon found across world.

The ‘Bonnie Brae’ is oblong, smooth, thin-skinned and seedless. These
are mostly grown in San Diego County, USA.
The 'Eureka' grows year-round and abundantly. This is the common
supermarket lemon, also known as 'Four Seasons' because of its ability
to produce fruit and flowers together throughout the year. This variety is
also available as a plant to domestic customers. There is also a pink-
fleshed Eureka lemon, with a green and yellow variegated outer skin.
They are commercially popular because of their reliable flavor and
continuous growing season.
The Lisbon lemon is very similar to the Eureka and is the other common
supermarket lemon. It is smoother than the Eureka, has thinner skin,
and has fewer or no seeds. It generally produces more juice than the
Eureka.
The ‘Meyer’ lemon is not ‘true’ lemon, but hybrid which is originated from
China. It is a cross between a lemon and a sweet orange such as a
mandarin. It looks like lime when young, rounder than true lemons and
with a lime green skin. As the lemon ripens, it takes on the typical yellow
shade, with a strong fragrance and thin skin. These lemons have a more
subtle flavor than the Eureka or Lisbon lemons, which are widely
available in grocery stores. Instead, they have a sweeter taste, with a
dark yellow flesh and usually around 10 seeds.
Primofiori Lemon is grown extensively in the Mediterranean region and
is the most largely commercially produced lemon in Spain. The trees
have a vigorous growth habit, with large leaves and dense foliage. The
fruit it produces is pale yellow in color,

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 with a thin and smooth skin. Lemons can be round or oval, and are
smaller in size than most other lemon varieties, though they tend to be
much juicier.
Verna This lemon tree is native to Spain, where it is the second most
important lemon tree after the Primofiori. It is widely known as both
Verna and Berna. The fruits of this tree are less appealing for
consumption than other lemons, as they tend to have a thick rind and
do not contain much juice. This lemon is ornamentally attractive.
The 'Sorrento’ is native to Italy. This fruit's zest is high in lemon oils. It
is the variety traditionally used in the making of limoncello (Italian lemon
liquor).
The 'Yen Ben' is an Australasian cultivar.

1.4 Health benefits and Nutritional Information

Lemon is a great source of vitamin C and fibre,

lemons contain many plant compounds, minerals, and essential oils.
Lemons contain very little fat and protein. They consist mainly of carbs
(10%) and water (88–89%). The carbohydrates in lemons are
primarily composed of fibres and simple sugars, such as glucose,
fructose, and sucrose. The main fibre in lemons is pectin. Soluble
fibres like pectin can lower blood sugar levels by slowing down the
digestion of sugar and starch. Dietary fibres are an important part of
a healthy diet and linked to numerous health benefits. It also rich in
following vitamins and minerals.

 Vitamin C. An essential vitamin and antioxidant, vitamin C is

important for immune function and skin health.

 Potassium. A diet high in potassium can lower blood pressure levels

and have positive effects on heart health.

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 Vitamin B6. A group of related vitamins, B6 is involved in converting
food into energy.

The carbohydrates in lemons are primarily composed of fibers and

simple sugars, such as glucose, fructose, and sucrose. The plant
compounds in lemons and other citrus fruit may have beneficial
effects on cancer, cardiovascular disease, and inflammation.

These are the main plant compounds in lemons:

Citric acid. The most abundant organic acid in lemons, citric acid may
help prevent the formation of kidney stones.

Hesperidin. This antioxidant may strengthen your blood vessels and

prevent atherosclerosis — the buildup of fatty deposits (plaque) inside
your arteries.
Diosmin. An antioxidant used in some drugs that affect the circulatory
system, it improves muscle tone and reduces chronic inflammation in
your blood vessels.
Eriocitrin. This antioxidant is found in lemon peel and juice.
D-limonene. Found primarily in the peel, d-limonene is the main
component of lemon essential oils and responsible lemons’ distinct
aroma. In isolation, it can relieve heartburn and stomach reflux.

Nutritional value per 100 g

Nutritional Parameters Values % of Daily value

Calories 29 Kcal -

Total Fat 0.3 g -

Saturated Fat 0g -

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 Trans Fat 0g -

Polyunsaturated Fat 0.1 g -

Mono saturated Fat 0g -

Cholesterol 0 mg -

Sodium 2 mg -

Potassium 138 mg 4 % of DV

Total Carbohydrates 9.3 g 3% of DV

Dietary Fiber 2.8 g 11 % of DV

Sugars 2.5 g -

Protein 1.1 g -

Vitamin A - 0.4 % of DV

Vitamin C - 88 % of DV

Calcium - 2 % of DV

Iron - 3.3 % of DV

Source: USDA Nutrient Database

Constituents and Health Benefits of Citrus lemon

Lemon also have many potential health benefits.

Eating lemons may lower your risk of heart disease, cancer, and kidney
stones. A medium lemon provides only about 20 calories.

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 Health benefits:

1. Heart health: Intake of fruits high in vitamin C is linked to reduced

heart disease risk; Intake of isolated fibers from citrus fruits has been
shown to decrease blood cholesterol levels, and the essential oils in
lemons can protect LDL (bad) cholesterol particles from becoming
oxidized. Flavonoids in citrus fruits may help lower the risk of
ischemic stroke in women. Long term, regular consumption of foods
that contain flavonoids might help protect against cancer and
cardiovascular disease. Potassium may help lower the risk of stroke.

2. Blood pressure: Consuming lemon can help reduce blood pressure.

3 Cancer prevention: Lemons and lemon juice are an excellent source

of the antioxidant vitamin C. Antioxidants may help prevent free radicals
from causing cell damage that can lead to cancer.

4 Prevent asthma: vitamin C also benefitted people with bronchial

hypersensitivity when they also had a common cold and people with
asthma.

5 Anemia prevention: Anemia is often caused by iron deficiency and

most common in pre-menopausal women. Lemons contain small
amounts of iron, but they are a great source of vitamin C and citric acid,
which can increase the absorption of iron from other foods. It may help
prevent anemia.

6. Prevention of kidney stones: The citric acid in lemons may reduce

your risk of kidney stones by diluting urine and increasing its citrate
content.

7. Boosting the immune system: Foods that are high in vitamin C and
other antioxidants may help strengthen the immune system against the
germs that cause the common cold and the flu.

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 8. Maintaining healthy complexion: Vitamin C plays a vital role in the
formation of collagen, the support system of the skin. Sun exposure,
pollution, age, and other factors can result in skin damage. By eating
vitamin C in its natural form or applying it topically can help prevent this
type of damage.

9. Weight loss: Lemon detox diet resulted in greater

improvements in insulin resistance, body fat, BMI, body weight, and
waist-hip ratio than those on the other diets.

10. Scurvy: Scurvy is caused by deficiency of Vitamin C, connective

tissues weaken due to the lack of vitamin C. Consumption of lemon of
vitamin prevent scurvy.

1.5 Cultivation, Bearing & Post Harvest management:-

Citrus Lemon is a small evergreen tree in the family

Rutaceae grown for its edible fruit which, among other things, are used
in a variety of foods and drinks. The tree has a spreading, upright
growth habit, few large branches and stiff thorns. The tree possesses
large, oblong or oval, light green leaves and produces purple-white
flowers in clusters. The lemon fruit is an ellipsoid berry surrounded by
a green rind, which ripens to yellow, protecting soft yellow segmented
pulp. Lemon trees can reach 3–6 m (10–20 ft.) in height and can live
for many years, reaching full fruit bearing capacity in approximately 40
years. Lemon may also be referred to as bush lemon or Persian apple
and likely originated from the eastern Himalaya of India.

Cultivation and Bearing:-

Lemon is a subtropical plant and the trees grow best

in regions with a pronounced change in season. They will grow best at
temperatures between 26–28°C (79–82°F) and are very sensitive to

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 cold. Trees and fruit will be damaged or killed by freezing conditions
without protection. The trees will tolerate drought conditions but perform
poorly in water-logged soil. Trees will grow best when planted in a well-
draining sandy loam with a pH between 6.0 and 7.5. Soil must be deep
enough to permit adequate root development. Lemon trees will grow
best when positioned in full sunlight. Lemon trees for commercial
planting are usually propagated by grafting or budding the desired
variety on seedlings of other Citrus species, such as the
sweet orange, grapefruit, mandarin orange, sour orange, or tangelo.
Newly planted trees require proper irrigation to ensure they
become established. During the first year, water should be applied at
the base of the trunk so that the root ball is kept moist to allow the roots
to establish in the soil. Newly planted trees should be provided with
water every 3–7 days. The soil should be moist, but not wet. Trees
planted in sandy soils will require water more frequently. Young trees
will also require a light application of fertilizer every month in the first
year. Lemon trees will need up around the trunk during the winter and
removed in the spring. Young trees can also be protected from frosts
by covering them with tarps or blankets as required.

Post-harvest management:-

There are some fruit handling management after harvesting to avoid

post-harvest losses. Following are Post-harvesting handling practices:
 Do not leave harvested fruit out in the hot sun;
 Do not pick cold, wet fruit. When wet turgid fruit is handled the oil
Glands can be ruptured. The released oil burns the fruit surface
(oleocellosis) and also stimulates fungal spores to germinate. The burn
Marks can take 2-3 days to develop;

 Wear cotton gloves when harvesting. This reduces puncture marks

from Fingernails and jewellery;
 Use picking bags. This reduces damage as a result of abrasion on
Wooden or metal picking bins and allows fruit to be gently lowered into

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 Bulk harvesting bins;

 Do not leave stems on fruit or damage buttons by “plugging”;

 Use clean, smooth harvesting bins;
 Make sure packing line equipment is cleaned regularly. This reduces
dirt and wax buildup which can cause fruit abrasion;
 Reduce packing line abrasion by using foam, rubber and smooth belts
to Cushion fruit;
 Remove old and rotten fruit regularly from the packing shed and
surrounds;
 Treat harvested fruit with a registered fungicide within 24hrs of harvest;

1.6 Processing & Value Addition:-

Lemon constitutes an important fresh fruit group

even though it is not eaten fresh as mandarins and oranges.
Sensitivity of lemon fruits to chilling injury makes it hard to
store in the commercial cold stores. So, due to sensitivity to chilling
injury and limited shelf life of lemon fruit, it becomes important to
process it in the form of juice to reduce the surplus in the market in its
peak season of production. Preservation of fruit in the form of juices has
turn out to be the business activity of great significance and countries
with rich fruit resources with short harvesting season are emphasizing
more for establishes storage to keep up quality of fruits, enhance shelf
life and preserve fruit juices for availability in off-season. Fruit juices are
preserved by various methods such as freezing, irradiation, heat
processing and addition of chemical preservatives.
Food fortification is the process of adding micronutrients (essential
trace elements and vitamins) to food. It can be carried out by food
manufacturers, or by governments as a public health policy which aims
to reduce the number of people with dietary deficiencies within a
population. Food fortification has a long history of use in industrialized
countries for the Successful control of deficiencies of vitamins A and D,

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 several B vitamins (thiamine, riboflavin and niacin), calcium, iodine and
iron. In the less industrialized countries, fortification has become an
increasingly attractive option in recent years, so much so that planned
programmers have moved forward to the implementation phase more
rapidly than previously thought possible. Interest in micronutrient
malnutrition has increased greatly over the last few years. One of the
main reasons for the increased interest is the realization that
micronutrient malnutrition contributes substantially to the global burden
of disease. In 2000, the World Health Report1 identified calcium, iodine,
iron, and vitamin A and zinc deficiencies as being among the world’s
most serious health risk factors.

Concern for the prevention of osteoporosis has led to an

increase in food fortification with calcium in World. Increased
awareness of the importance of calcium (Ca) for bone health throughout
life has led to an increase in the number and types of Ca supplements
and to Ca fortification of foods. Different calcium sources for fortification
have advantages in terms of cost, calcium content, convenience, and
their taste compatibility with foods. Calcium is a key mineral in the
human body, necessary for normal growth and development of the
skeleton as well as for teeth, nerve, muscle and enzyme functions. As
the body’s calcium absorption capabilities reduce with age, it is vital for
the ageing to have a sufficient calcium intake. There are several options
to avoid calcium deficiency by increasing the daily calcium intake.

Health benefits of Calcium:

 Essential for development, growth and maintenance of bone
 Regulate muscle contraction
 Key role in blood clotting
 Lowers blood pressure
 Improved cholesterol values
 Lower risk of colorectal adenomas, a type of non-cancerous tumor

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 Prevention of vitamin D deficiency and insufficiency remains
an international health care priority. Rates of vitamin D deficiency and
insufficiency are highest among elderly and institutionalized adults In
addition, darker-pigmented persons and Asians have a higher
prevalence of vitamin D insufficiency because their skin is unable to
produce vitamin D3 efficiently. Vitamin D insufficiency results in
secondary hyperparathyroidism and causes rickets in children and
osteomalacia and osteoporosis in adults. Increasing evidence
indicates that vitamin D insufficiency is associated with an increased
risk of colon cancer, breast cancer, prostate cancer, and other
cancers. Vitamin D is difficult to obtain from the diet because it is not
naturally present in many foods. Fortification of food with Vitamin D is
increasing rapidly worldwide. Marketing demand of Calcium and
vitamin D fortified fruit juices is growing.

Health benefits of Vitamin D:

 Help strengthen muscles

 Help strengthen bones
 Support immune system and fight inflammation
 Help strengthen oral health
 Help prevent type 1 and typ3 diabetes
 Help treat hypertension
 Reduce risk of certain cancer

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 2. Model Fortified Citrus lemon juice Processing under FME
Scheme

2.1 Location of the Proposed Project and Land

The entrepreneur must provide description of the proposed location,

site of the project, distance from the targeted local and distant markets;
and the reasons/advantages thereof i.e. in terms of raw materials
availability, market accessibility, logistics support, basic infrastructure
availability etc.

The ideal locations for establishment of exclusive

Fortified Citrus lemon juice processing unit are in the production
clusters of Citrus lemon growing states such as Gujarat. Andhra
Pradesh, Madhya Pradesh, Karnataka, Orissa, Maharashtra and Uttar
Pradesh where adequate quantities of surplus raw materials can be
available for processing.

2.2 Installed Capacity of the Fortified Citrus lemon juice

Processing Unit

The maximum installed capacity of the Fortified Citrus lemon juice

manufacturing unit in the present model project is proposed as 150
tonns/annum or 500 kg/day Fortified Citrus lemon juice. The unit is
assumed to operate 300 days/annum @ 8-10 hrs/day. The 1st year is
assumed to be construction/expansion period of the project; and in the
2nd year 70 percent capacity, 3rd year 80 percent capacity and 4th year
onwards 90 percent capacity utilization is assumed in this model
project.

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 2.3 Raw Material Requirements for the Unit

A sustainable food processing unit must ensure maximum capacity

utilization and thus requires an operation of minimum 280-300 days per
year to get reasonable profit. Therefore, ensuring uninterrupted raw
materials supply requires maintenance of adequate raw material
inventory. The processor must have linkage with producer
organizations preferably FPCs through legal contract to get adequate
quantity and quality of raw materials which otherwise get spoiled. In the
fortified citrus lemon juice manufacturing project, the unit requires 350
kg/day, 400 kg/day and 450 kg/day raw lemon fruit at 70, 80 and 90
percent capacity utilization, respectively. The Mature lemon must be
plucked from plant; and then stored below 6°C temperature.

2.4 Manufacturing process of the Fortified Citrus lemon juice

The typical Procedure for manufacturing of Fortified lemon juice is as
below:

Lemon fruits
(Mature and ripened fruits with characteristic flavor will be used)

Sorting

*Washing and cleaning (Soaked in water containing chlorine solution (10-

20ppm) for 2-5 minutes)

Juice extraction

Juice Clarification

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 Preservatives addition (Potassium metabisulphate at rate of 0.1 % or
sodium benzoate at rate of 0.1%)

Filtration (Filtration by UF membrane of MW cut-off 300kDa)

Homogenization (Optional)

*Heat treatment (77°C for 30 seconds)

Fortification with Calcium and Vitamin D

(0.16 % Tricalcium citrate & Vitamin D 4.17 mg/liter)

Filling and packaging

*Storage
*Established Critical Control point
Receiving of lemon fruits: Fruit goes through inspection lines for
removal of bruised or damages fruits.
Washing and cleaning: The fruits are graded and soaked in water
containing chlorine solution (10-20ppm) for 2-5 minutes, scrubbed by
revolving brushes, rinsed with clean water, and inspected again to
remove the damaged ones.
Juice extractor: Juice is extracted by automatic juice extractors. These
extractors produces juice free of peel extractives.

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 Filtration: Juice is screened as soon as possible to remove insoluble
solids, which contain leachable substances that may impair flavor, color
and cloud stability of juice. For better juice yields, screening in paddle
finishers or screw presses id done to remove coarse pulp. UF unit for
clarification of lemon juice is also used. Membrane with a molecular
weight cut-off of 300kDa was best suited for clarification of lemon juice.
Preservatives addition: Preservatives are added to prevent or reduce
the microbial spoilage. Sulfur dioxide acts as an antimicrobial agent and
also stabilize ascorbic acid and it is added in fruit juices in the form of
sulfites and metabisulpfites of sodium and potassium. Potassium
metabisulphate at rate of 0.1 % is added or sodium benzoate at rate of
0.1% is also added.

Pasteurization: Heat the juice to a temperature for sufficient time and

to assure practical sterility as well as cloud stability by inactivating
natural juice enzymes. Temperature of 77°C for 30 seconds is used.
The juice is cooled immediately after pasteurization by passing through
the heat exchanger.
Packaging: Different types of packaging including cans, bottles,
cartons, drums and barrels made up of glass, metals, plastic, or
laminates are used for the packaging of Lemon juice.

2.5 Market Demand and Supply for Fortified Citrus lemon Juice

Lemon constitutes an important fresh fruit group even though it is not

eaten fresh as mandarins and oranges. They usually have high acid
content although acid less cultivars also exist. It is used primarily for
drinks and fresh juice or lemonade, cooking and flavoring, especially
in the making of lemon pies, lemon cakes, candies, jams and
marmalades, and also for medicinal purposes due to its high content
of vitamins.

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 Lemon Fruits and peel were processed into various
value added products like lemon Squash, lemon salt pickle, lemon
sweet pickle, lemon sweet pickle without oil, lemon candied peel,
lemon candied peel with chocolate, lemon candied fruit slices, lemon
candied fruit slices with chocolate and lemon jelly. Lemon peel also
processes into essential oil products. Due to sensitivity to chilling injury
and limited shelf life of lemon fruit, it becomes important to process it
in the form of juice to reduce the surplus in the market in its peak
season of production. Preservation of fruit in the form of juices has turn
out to be the business activity of great significance and countries with
rich fruit resources with short harvesting season are emphasizing more
for establishes storage to keep up quality of fruits, enhance shelf life
and preserve fruit juices for availability in off-season.

2.6 Marketing Strategy for Citrus Lemon Products

The increasing urbanization and income offers huge scope for

marketing of fruit based products. Urban organized platforms such as
departmental stores, malls, super markets can be attractive platforms
to sell well packaged and branded Citrus lemon based products.

2.7 Detailed project Assumptions

This model DPR for Fortified citrus lemon juice unit is basically prepared
as a template based on certain assumptions that may vary with
capacity, location, raw materials availability etc. An entrepreneur can
use this model DPR format and modify as per requirement and
suitability. The assumptions made in preparation of this particular DPR
are given in This DPR assumes expansion of existing fruit processing
unit by adding new juice manufacturing line. Therefore, land and civil

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 infrastructures are assumed as already available with the
entrepreneurs.
 Herewith in this DPR, we have considered the assumptions as listed
below in the tables of different costs, which may vary as per region,
seasons and machinery designs and supplier.
1. Citrus lemon cost considered @ Rs.7/-per kg.
2. 1 kg Citrus lemon will produce 22% recovery.
3. 1 Batch size is approximately 100 kg.
4. No. of hours per day are approximately 10 hours.
5. Batch yield is 95%
Detailed Project Assumptions

Parameter Assumption
Capacity of the Fortified Citrus
Lemon Juice Unit 150 MT/annum
1st Year Implementation, 70% in second,
Utilization of capacity 80% in third and 90% in fourth year
onwards
Working days per year 300 days
Working hours per day 10 hours
Interest on term and working
capital loan 12
Seven year with one year grace period is
Repayment period considered.
Average prices of raw material Rs. 7 per Kg
Average sale prices of Fortified
Citrus lemon juice/kg 200 Rs/kg
Pulp extraction 22
4.54 Kg Citrus lemon Fruit /Kg Fortified
Pulp processing Citrus lemon juice

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 2.8 Fixed Capital Investment

2.8.1 Machinery and Equipment

Sr No. Equipment Capacity Quantity Price (Rs. In Lacs)

1 Cold store sq. meter 1500 kgs 1 4.5

Lemon Washing Tank with
2.7
2 conveyor 100 kg/hr 1
3 Fruit juice Extractor continuous 1 2.2
4 Filter press 100 kg/hr 1 0.8
5 Inline Homogenizer 100 kg/batch 1 1.8
6 Gas fired Kettle-200 Ltr 100 kg/hr 1 1.8
7 Juice storage tank (Insulated) continuous 1 1.5
8 Bottling line 0 to 30 Kg/hr 1 1.45
9 Weighing balance suitable 1 0.2
10 Accessories suitable 1 0.9
12 Contingency Standard 1 0.9
13 Water + Power 3
14 Fixed Assets 0.9
15 Pre-operative cost 0.9
23..55

2.8.2 Other costs:-

Utilities and Fittings:-

Utilities and Fittings

1. Water Rs. 3 Lacs total
2. Power

Other Fixed Assests:

Other Fixed Assets

1. Furniture & Fixtures Rs. 0.9 lac total
2. Plastic tray capacity
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 3. Electrical fittings

Pre-operative expenses

Pre-operative Expenses
Legal expenses, Start-up 0.9 LAC
expenses, Establishment
cost, consultancy fees, trials
and others.
Total preoperative expenses 0.9 LAC

Contingency cost to be added as approx.1 Lac.

So total startup cost at own land & Premise may be somewhat similar
to 34.04 lacs. This is according to survey done at X location india. This
may vary on location, situation and design change over.

2.9 Working Capital requirements

Year 4
(90%-
Year 2 (70%-70 Year 3(80%- 90
Particulars Period MT) 80MT) MT)
Raw material stock 7 days 1.25 1.42 1.83
Work in progress 15 days 5.79 6.62 8.51
Packing material 15 days 1.35 1.54 1.98
Finished goods’ stock 15 days 4.58 5.23 6.73
Receivables 30 days 9.16 10.47 13.46
Working expenses 30 days 1.12 1.28 1.65
Total current assets 23.25 26.57 34.16
Trade creditors 0.00 0.00 0.00
Working capital gap 23.25 26.57 34.16
Margin money (25%) 5.81 6.64 8.54
Bank finance 17.44 19.93 25.62

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2.10 Total project Cost and Means of Finances
Amount in
Particulars
Lakhs
i. Land and building (20 x 32 x 12 ft -
LxBxH) 4.44
ii. Plant and machinery 23.55
iii. Utilities & Fittings 3
iv. Other Fixed assets 0.9
v. Pre-operative expenses 0.90
vi. Contingencies 1.00
vii. Working capital margin 0.25
Total project cost (i to vii) 34.04
Net Sale per Day in Lacs 0.20
Net Profit Per Annum @300 working days 203.83
Less than 1
Payback Period year

2.11 Manpower Requirements

Total Monthly Salary (Rs.) No Wages Total Monthly Total Annualy
Supervisor (can be the owner) 1 18000 18000 216000
Technician 1 14000 14000 168000
Semi skilled 2 7600 15200 182400
Helper 1 5500 5500 66000
Sales man 1 8000 8000 96000
60700 728400

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2.12 Expenditure, Revenue and Profitability Analysis
2nd 3rd 4 th
Particulars 1st Year Year Year Year 5th year 6th year
45 MT
A Total Installed Capacity (MT) Lemon/Annum 105 120 135 135 135
Capacity utilization (%) Under Const. 70% 80% 90% 90% 90%
B Expenditure (Rs. in Lakh) 0
Raw Lemon(Av. Price @ Rs. 7/Kg ) 0.00 7.34 8.39 9.44 9.44 9.44
Other ingredients 0.00 0.10 0.11 0.13 0.13 0.13
Packaging materials (Rs 18 per Kg) 0.00 18.90 21.60 24.30 24.30 24.30
Utilities (Electricity, Fuel) 0.00 1.65 1.88 2.12 2.12 2.12
Salaries (1st yr only manager’s salary) 2.16 7.28 7.28 7.28 7.28 7.28
Repair & maintenance 0.00 0.70 0.80 0.90 0.90 0.90
Insurance 0.30 0.30 0.30 0.30 0.30 0.30
Miscellaneous expenses 0.50 2.30 2.30 2.30 2.30 2.30
Total Expenditure 2.96 38.57 42.67 46.77 46.77 46.77
C Total Sales Revenue (Rs. in Lakh) 0.00 210.00 240.00 270.00 270.00 270.00
Sale of Fortified Citrus lemon juice (Av. Sale Price @
Rs. 200/kg) 0.00 210.00 240.00 270.00 270.00 270.00
PBDIT (Total exp.-Total sales rev.) (Rs. in Lakh)/Cash
D Inflows -2.96 171.43 197.33 223.23 223.23 223.23
Depreciation on civil works @ 5% per annum 0.22 0.21 0.20 0.19 0.18 0.17
Depreciation on machinery @ 10% per annum 2.36 2.12 1.91 1.72 1.55 1.39
Depreciation on other fixed assets @ 15% per annum 0.59 0.50 0.42 0.36 0.31 0.26
Interest on term loan @ 12% 1.92 1.92 1.90 1.66 1.42 1.18
Interest on working capital @ 12% 0.00 2.09 2.39 3.07 3.07 3.07
E Profit after depreciation and Interest (Rs. in Lakh) -8.04 166.68 192.90 219.31 219.78 220.23
F Tax (assumed 30%) (Rs. in Lakh) 0.00 50.00 57.87 65.79 65.93 66.07
G Profit after depreciation, Interest & Tax (Rs. in Lakh) -8.04 116.68 135.03 153.51 153.85 154.16
Surplus available for repayment (PBDIT-Interest on
H working capital-Tax) (Rs. in Lakh) -3.70 65.00 74.30 83.30 83.00 82.80

I Coverage available (Rs. in Lakh) -3.70 65.00 74.30 83.30 83.00 82.80
J Total Debt Outgo (Rs. in Lakh) 1.92 3.72 3.70 3.46 3.22 2.98
K Debt Service Coverage Ratio (DSCR) -1.93 17.47 20.08 24.08 25.78 27.79
Average DSCR 18.88
L Cash accruals (PBDIT- Interest-Tax) (Rs. in Lakh) -4.88 119.50 137.56 155.78 155.88 155.98
M Payback Period
(on Rs. 30 Lakhs initial investment) 2 Years

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2.13 Repayment Schedule
Amount in Lakhs
o/s
Loan
at
the
Year
end
Outstanding Total of
loan at start outstanding Surplus for Interest Repayment Total the
of yr. Disbursement Loan repayment payment of principal Outgo yr. Balance left
1 0 14 14 -3.7 1.92 0 1.92 14 -1.78
2 14 14 65 1.92 1.8 3.72 12 61.28
3 12 12 74.3 1.90 1.8 3.70 10 70.60
4 10 10 83.3 1.66 1.8 3.46 8 79.84
5 8 8 83 1.42 1.8 3.22 6 79.78
6 6 6 82.8 1.18 1.8 2.98 4 79.82
7 4 4 82.77 0.94 1.8 2.74 2 80.03
8 2 2 82.76 0.70 1.8 2.50 0 80.26

2.14 Asset’s Depreciation

Assets’
Depreciation (Down Amounts
Value Method) in Lakhs
Particulars 1st Year 2nd year 3 rd year 4th year 5th year 6th year 7th year 8th year
Civil works 4.44 4.218 4.0071 3.806745 3.616408 3.435587 3.263808 3.100618
Depreciation 0.222 0.2109 0.200355 0.190337 0.18082 0.171779 0.16319 0.155031
Depreciated value 4.218 4.0071 3.806745 3.616408 3.435587 3.263808 3.100618 2.945587

Plant & Machinery 23.55 21.195 19.0755 17.16795 15.45116 13.90604 12.51544 11.26389
Depreciation 2.355 2.1195 1.90755 1.716795 1.545116 1.390604 1.251544 1.126389
Depreciated value 21.195 19.0755 17.16795 15.45116 13.90604 12.51544 11.26389 10.1375

Other Fixed Assets 3.9 3.315 2.81775 2.395088 2.035824 1.730451 1.470883 1.250251
Depreciation 0.585 0.49725 0.422663 0.359263 0.305374 0.259568 0.220632 0.187538
Depreciated value 3.315 2.81775 2.395088 2.035824 1.730451 1.470883 1.250251 1.062713

All Assets 31.89 28.728 25.90035 23.36978 21.10339 19.07208 17.25013 15.61476
Depreciation 3.162 2.82765 2.530568 2.266395 2.03131 1.821951 1.635366 1.468958
Depreciated value 28.728 25.90035 23.36978 21.10339 19.07208 17.25013 15.61476 14.1458

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 2.15 Financial Assessment of the project

Benefit Cost Ratio (BCR) and Net

Present Worth (NPW)
2nd 3 rd
Particulars 1st Year year year 4th year 5th year 6th year 7th year 8th year
Capital cost (Rs. in Lakh) 34.04 0.00 0.00 0.00 0.00 0.00 0.00 0.00
Recurring cost (Rs. in Lakh) 2.96 38.57 42.67 46.77 46.77 46.77 46.77 46.77
Total cost (Rs. in Lakh) 37.00 38.57 42.67 46.77 46.77 46.77 46.77 46.77 352.08
Benefit (Rs. in Lakh) 0.00 210.00 240.00 270.00 270.00 270.00 270.00 270.00
Total Depreciated value of all assets (Rs. in Lakh) 14.1458
Total benefits (Rs. in Lakh) 0.00 210.00 240.00 270.00 270.00 270.00 270.00 284.15 1814.15
Benefit-Cost Ratio (BCR): (Highly Profitable project) 5.15
Net Present Worth (NPW): 828.34

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 2.16 Break even analysis

Break even analysis indicates costs-volume profit relations in the short run. This is the level at
which, the firm is in no loss no profit situation.

Particulars 1st Year 2nd year 3 rd year 4th year 5th year 6th year 7th year 8th year
Under
Capacity utilization (%) Const. 70% 80% 90% 90% 90% 90% 90%
Production MT/Annum 105 120 135 135 135 135 135
Fixed Cost (Rs. in Lakh)
Permanent staff salaries 7.28 7.28 7.284 7.284 7.284 7.284 7.284 7.284
Depreciation on building @ 5% per annum 0.22 0.21 0.20 0.19 0.18 0.17 0.16 0.15
Depreciation on machinery @ 10% per annum 2.35 1.69 1.52 1.37 1.23 1.11 1.00 0.90
Depreciation on other fixed assets @ 15% per annum 0.58 0.39 0.33 0.28 0.24 0.20 0.17 0.14
Interest on term loan 1.92 1.92 1.90 1.66 1.42 1.18 0.94 0.70
Insurance 0.3 0.3 0.3 0.3 0.3 0.3 0.3 0.3
Total Fixed Cost (Rs. in Lakh) 12.66 11.80 11.54 11.09 10.66 10.25 9.86 9.48
Sales Revenue (Rs. in Lakh) 0 210 240 270 270 270 270 270
Variable Cost (Rs. in Lakh)
Raw lemon (Av. Price @ Rs. 7/Kg ) 0 7.34 8.39 9.44 9.44 9.44 9.44 9.44
Other ingredients 0 0.10 0.11 0.12 0.12 0.12 0.12 0.12
Packaging materials 0 18.9 21.6 24.3 24.3 24.3 24.3 24.3
Casual staff salaries 0 5.78 5.78 5.78 5.78 5.78 5.78 5.78
Utilities (Electricity, Fuel) 0 1.64 1.88 2.12 2.12 2.12 2.12 2.12
Repair & maintenance 0 0.7 0.8 0.9 0.9 0.9 0.9 0.9
Miscellaneous expenses 0.5 2 2 2 2 2 2 2
Interest on working capital @ 12% 0 2.09 2.39 3.07 3.07 3.07 3.07 3.07
Total Variable Cost (Rs. in Lakh) 0.5 38.57 42.96 47.75 47.75 47.75 47.75 47.75
Break Even Point (BEP)
as % of sale - 12 10 8 8 7 7 6
Break Even Point (BEP) in terms of sales value (Rs. in
Lakhs) - 25.2 24 21.6 21.6 18.9 18.9 16.2

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2.17 Pie chart for better understanding of expenses of each
head:

Amount (in Lakhs)

0.9, 4% 0.9, 4%

4.5, 19%
3, 13%

0.9, 4%
0.9, 4% 2.7, 11%

1.45, 6%
0.2, 1% 2.2, 9%
1.5, 6%

1.8, 8% 1.8, 8%

0.8, 3%

Cold store sq. meter Lemon Washing Tank with conveyor

Fruit juice Extractor Filter press
Inline Homogenizer Gas fired Kettle-200 Ltr
Juice storage tank (Insulated) Bottling line
Weighing balance Accessories
Contingency Water + Power
Fixed Assets Pre-operative cost

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 2.18 Typical Fortified Citrus lemon juice Manufacturing Unit
Layout

2.19 Machinery Suppliers

There are many machinery suppliers available within India for

fruits based beverage processing machineries and equipment.
Some of the suppliers are:
1. Bajaj Process pack Limited, Noida, India 0
2. Shriyan Enterprises. Mumbai, India

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3. Limitations of Model DPR & Guidelines for Entrepreneurs

3.1 Limitations of the DPR

i. This DPR has provided only the basic standard components and
methodology to be adopted by an entrepreneur while submitting
a proposal under the Formalization of Micro Food Processing
Enterprises Scheme of MoFPI.

ii. This DPR is made to provide general methodological structure

not for specific entrepreneur/crops/location. Therefore,
information on the entrepreneur, forms and structure
(proprietorship/partnership/cooperative/ FPC/joint stock
company) of business, background of proposed project, location,
raw material base/contract sourcing, entrepreneur’s own SWOT
analysis, market research, rationale of the project for specific
location, community advantage/benefit, employment generation
etc are not given in detail.

iii. The present DPR is based on certain assumptions on cost,

prices, interest, capacity utilization, output recovery rate and so
on. However, these assumptions in reality may vary across
places, markets and situations; thus the resultant calculations will
also change accordingly.

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3.2 Guidelines for the Entrepreneurs

i. The success of any prospective food processing project

depends on how closer the assumptions made in the initial
stage are with the reality of the targeted
market/place/situation. Therefore, the entrepreneurs must do
its homework as realistic as possible on the assumed
parameters.

ii. This model DPR must be made more comprehensive by the

entrepreneur by including information on the entrepreneur,
forms and structure (proprietorship/partnership/cooperative/
FPC/joint stock company) of entrepreneur’s business, project
location, raw material costing base/contract sourcing, detailed
market research, comprehensive dehydrated product mix
based on demand, rationale of the project for specific location,
community advantage/benefit from the project, employment
generation, production/availability of the raw materials/crops
in the targeted area/clusters and many more relevant aspects
for acceptance and approval of the competent authority.

iii. The entrepreneur must be efficient in managing the strategic,

financial, operational, material and marketing aspects of a
business. In spite of the assumed parameter being closely
realistic, a project may become unsustainable if the
entrepreneur does not possess the required efficiency in
managing different aspects of the business and respond
effectively in changing situations.

iv. The machineries should be purchased after thorough market

research and satisfactory demonstration.

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 v. The entrepreneur must ensure uninterrupted quality raw
materials’ supply and maintain optimum inventory levels for
smooth operations management.

vi. The entrepreneur must possess a strategic look to steer the

business in upward trajectory.

vii. The entrepreneur must maintain optimum (not more or less)

inventory, current assets. Selecting optimum source of
finance, not too high debt-equity ratio, proper capital
budgeting and judicious utilization of surplus profit for
expansion is must.

viii. The entrepreneur must explore prospective markets through

extensive research, find innovative marketing strategy, and
maintain quality, adjust product mix to demand.

ix. The entrepreneur must provide required documents on land,

financial transaction, balance sheet, further project analysis
as required by the competent authority for approval.

x. The entrepreneur must be hopeful and remain positive in

attitude while all situations.

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 Contact Us
Director
Indian Institute of Food Processing Technology
(Ministry of Food Processing Industries, Government of India)
Pudukkottai Road, Thanjavur - 613 005, Tamil Nadu
Phone No.: +91- 4362 - 228155, Fax No.:+91 - 4362 – 227971
Email: [email protected]; Web: www.iifpt.edu.in

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