EXHIBIT 2: ESTIMATED INVESTMENT IN INDIAN RUPEES

Building Modification ₹1,400,000.00

Water supply arrangements ₹100,000.00

Machinery ₹2,000,000.00
Trucks ₹3,000,000.00
Payload machine ₹1,500,000.00
Total ₹8,000,000.00
Working Capital ₹2,000,000.00
EXHIBIT 3: ROUTINE EXPENSES PER MONTH IN INDIAN RUPEES
Building rent ₹50,000.00
Administrative cost ₹10,000.00
Office supply ₹5,000.00
Electricity (for lighting) ₹10,000.00
Miscellaneous ₹20,000.00

Selling price (per unit) ₹7.00

Estimated annual demand of bricks 2,400,000
Annual production capacity 4,000,000

Initial investment ₹10,000,000.00

Self funding ₹6,000,000.00
Loan amount ₹4,000,000.00
Interest rate 12%

Revenues

Variable cost
Manufacturing cost
Fly ash ₹3,000,000.00 Direct
Gypsum ₹3,000,000.00 Direct
Lime ₹3,600,000.00 Direct
Sand ₹480,000.00 Direct
Labour ₹600,000.00 Direct
Electricity ₹120,000.00 Direct

Total Variable Cost

Contribution Margin

Fixed Cost
Production Manager ₹600,000.00 Direct
Building Modification ₹280,000.00 Indirect
Water supply arrangements ₹20,000.00 Direct
Machinery ₹400,000.00 Direct
Trucks ₹600,000.00 Direct
Payload machine ₹300,000.00 Direct
Workers ₹1,200,000.00 Indirect
Drivers ₹300,000.00 Direct
Watchman ₹180,000.00 Indirect
Building rent ₹600,000.00 Indirect
Office assistant ₹240,000.00 Indirect
Administrative cost ₹120,000.00 Indirect
Office supply ₹60,000.00 Indirect
Electricity (for lighting) ₹120,000.00 Indirect
Miscellaneous ₹240,000.00 Indirect
Interest ₹480,000.00 Indirect
Total Fixed Cost

Operating Income
Income Tax @ 30% 30%

Net Income
Profit Margin

Return on investment

Targeted ROI
Targeted Net Income
Targeted Operating Income

Targeted unit sale for 12% ROI

 EXHIBIT 4: EXPENSES RELATED TO VOLUME OF PRODUCTION
PER MONTH IN INDIAN RUPEES (FOR 0.20 MILLION BRICKS)
Fly ash ₹250,000.00

Gypsum ₹250,000.00

Lime ₹300,000.00
Sand ₹40,000.00
Electricity ₹10,000.00
Labour ₹50,000.00
Total ₹900,000.00
EXHIBIT 5: PERSONNEL COSTS PER MONTH IN INDIAN RUPEES
Workers ₹100,000.00
Office assistant ₹20,000.00
Watchman ₹15,000.00
Drivers ₹25,000.00
Sharma's Salary
₹50,000.00
(Production manager)

CVP Analysis (Base case)

Contribution Margin per unit
BEP Units
BEP Sales
Contribution Margin Ratio
Degree of Operating Leverage

CVP Analysis (outsourced Trucking/Logistics)

₹16,800,000.00 CM
Contribution Margin per unit
Fixed Cost
NEW OI
New NI
ROI
BEP Units
Degree of Operating Leverage

Sensitivity of BEP to CM% (Base cas

₹10,800,000.00

₹6,000,000.00 CM%

20%
22%
24%
26%
28%
 30%
32%
34%
36%
38%
40%

5.00 Runs th
due to
4.50
₹5,740,000.00

# of units of Bricks (in millions)

4.00
3.50
₹260,000.00 0.0154761904761905 1.54761904761905
3.00
₹78,000.00
2.50
Estimated Annua
₹182,000.00 2.00
1.08% 1.50
1.00
1.82% ₹728,000.00
4.33% 0.50

12% -
₹1,200,000.00 20% 22% 24%
₹1,714,285.71
BEP (# of Mil Units) (
Annual Demand
2,981,714 ₹20,872,000.00

10.18
5.59340659340659
 1000000
Revenues Total Cost
Production (in million Fixed Cost Variable Cost
(₹ (₹
units) (₹ million) (₹ million)
million) million)
1 7 5.74 4.5 10.24
1.2 8.4 5.74 5.4 11.14
1.4 9.8 5.74 6.3 12.04
1.6 11.2 5.74 7.2 12.94
1.8 12.6 5.74 8.1 13.84
2 14 5.74 9 14.74
2.2 15.4 5.74 9.9 15.64
2.4 16.8 5.74 10.8 16.54
2.6 18.2 5.74 11.7 17.44
2.8 19.6 5.74 12.6 18.34
3 21 5.74 13.5 19.24
3.2 22.4 5.74 14.4 20.14
3.4 23.8 5.74 15.3 21.04
₹2.50 3.6 25.2 5.74 16.2 21.94
2,296,000 3.8 26.6 5.74 17.1 22.84
₹16,072,000.00 4 28 5.74 18 23.74
35.71%
23.08

ed Trucking/Logistics)
₹5,100,000.00
₹2.13
₹4,486,000.00
₹614,000.00 ₹260,000.00
₹429,800.00
6.10%
2,111,059
8.31

1,000,000.00

Annual
BEP (# Mil of Units) Capacity (#
BEP (# of Mil Units) (Base Demand (#
(Outsourced Trucking of units in
case) of units in
and Logistics) mil)
mil)
4.10 3.20 2.40 4.00
3.73 2.91 2.40 4.00
3.42 2.67 2.40 4.00
3.15 2.46 2.40 4.00
2.93 2.29 2.40 4.00 2111
 2.73 2.14 2.40 4.00 2400
2.56 2.00 2.40 4.00 1.1369019
2.41 1.88 2.40 4.00
2.28 1.78 2.40 4.00
2.16 1.69 2.40 4.00
2.05 1.60 2.40 4.00

Sensitivity of BEP to CM%

5.00 Runs the risk of never breaking even if CM% drops to 20%
due to changes in selling price and/or costs
4.50
Plant Capacity
4.00
3.50 BEP (Base Case)
At lower CM%, the number of units
3.00 required begins to increase exponentially
2.50
Estimated Annual Demand
2.00
1.50
1.00 BEP (Outsourced Trucking and Logistics)
Able to achieve breakeven with lower CM%. Firm will have
0.50 better protection against fluctuations in selling price and costs

-
20% 22% 24% 26% 28% 30% 32% 34% 36% 38% 40%

CM%
BEP (# of Mil Units) (Base case) BEP (# Mil of Units) (Outsourced Trucking and Logistics)
Annual Demand Capacity
 Operating
Per Unit
Profit (₹ RoI zero Profit CVP Analysis for Fl
Cost (₹)
million)
10.24 -3.24 -32% 30 0 BEP
9.28 -2.74 -27% 0 Revenues = ₹ 16.07
8.60 -2.24 -22% Cost
0 per Brick # of Bricks = 2.296 m
25

Revenues, Costs, Profit (₹ million)

8.09 -1.74 -17% 0
7.69 -1.24 -12% 20 0
7.37 -0.74 -7% 0
7.11 -0.24 -2% 15
0
6.89 0.26 3% 0
6.71 0.76 8% 0
10
6.55 1.26 13% 0
6.41 1.76 18% 5 0
6.29 2.26 23% 0
6.19 2.76 28% 0
1 0 1.2 1.4 1.6 1.8 2 2.2 2.4 2.6
6.09 3.26 33% 0
6.01 3.76 38% -5 0
5.94 4.26 43% 0 Production in mi

Revenues (₹ million) Fixed Cost (₹ m

Total Cost (₹ million) Operating Profi

RoI vs. Production Qua

4.5
4
Production( in millions)

3.5
3
2.5
2
1.5
1
0.5
0
- - - - - -7% -2% 3% 8% 13% 18
32% 27% 22% 17% 12%

RoI

Production (in million units) Opera

2,111,059
2400000
288,941
 CVP Analysis for Fly Ash Brick Plant
BEP 12.00
Revenues = ₹ 16.07 million Revenues
# of Bricks = 2.296 million
10.00

Total Cost of Production

8.00

Per unit cost in Rs

Variable Cost
6.00

Fixed cost 4.00

Profit 2.00
1.8 2 2.2 2.4 2.6 2.8 3 3.2 3.4 3.6 3.8 4

Production in millions

₹ million) Fixed Cost (₹ million) Variable Cost (₹ million)

₹ million) Operating Profit (₹ million) Per Unit Cost (₹)

RoI vs. Production Quantity

5
4
Net Income (in ₹ million)

3
2
1
0
-1
-2
-3
-4
- - -7% -2% 3% 8% 13% 18% 23% 28% 33% 38% 43%
7% 12%

RoI

duction (in million units) Operating Profit (₹ million)

EXHIBIT 2: ESTIMATED INVESTMENT IN INDIAN RUPEES

Building Modification ₹1,400,000.00

Water supply arrangements ₹100,000.00
Machinery ₹2,000,000.00
Payload machine ₹1,500,000.00

Total ₹5,000,000.00
Working Capital 2,050,000
EXHIBIT 3: ROUTINE EXPENSES PER MONTH IN INDIAN RUPEES
Building rent ₹50,000.00
Administrative cost ₹10,000.00
Office supply ₹5,000.00
Electricity (for lighting) ₹10,000.00
Miscellaneous ₹20,000.00

Selling price (per brick) ₹7.00

Estimated demand of bricks (annual) 2,400,000
Production capacity (annual) 4,000,000

Initial investment ₹7,050,000.00

Self funding ₹6,000,000.00
Loan amount ₹1,050,000.00
Interest rate 12%

Revenues

Variable Cost
Manufacturing
Fly ash ₹3,000,000.00
Gypsum ₹3,000,000.00
Lime ₹3,600,000.00
Sand ₹480,000.00
Labour ₹600,000.00
Electricity ₹120,000.00

Non-manufacturing

Outsourced Delivery ₹900,000.00

Total Variable Cost

Contribution Margin

Fixed Cost
Production Manager ₹600,000.00
Building Modification ₹280,000.00
Water supply arrangements ₹20,000.00
Machinery ₹400,000.00
Payload machine ₹300,000.00
Workers ₹1,200,000.00
Watchman ₹180,000.00
Building rent ₹600,000.00
Office assistant ₹240,000.00
Administrative cost ₹120,000.00
Office supply ₹60,000.00
Electricity (for lighting) ₹120,000.00
Miscellaneous ₹240,000.00
Interest ₹126,000.00
Total Fixed Cost

Operating Income
Income Tax @ 30% 30%

Net Income
Profit Margin
ROI
Targeted ROI
Targeted Net Income
Targeted Operating Income

Targeted unit sale for 12% ROI

 EXHIBIT 4: EXPENSES RELATED TO VOLUME OF PRODUCTION
PER MONTH IN INDIAN RUPEES (FOR 0.20 MILLION BRICKS)
Fly ash ₹250,000.00
Gypsum ₹250,000.00
Lime ₹300,000.00
Sand ₹40,000.00
Electricity ₹10,000.00
Labour ₹50,000.00
Assuming a monthly credit term Total ₹900,000.00
EXHIBIT 5: PERSONNEL COSTS PER MONTH IN INDIAN RUPEES
Workers ₹100,000.00
Office assistant ₹20,000.00
Watchman ₹15,000.00
Drivers ₹25,000.00
Sharma's Salary
₹50,000.00
(Production manager)

₹16,800,000.00

₹11,700,000.00

₹5,100,000.00 ₹2.13
₹4,486,000.00

₹614,000.00
₹184,200.00 ₹2,022,588.24
12.04%
₹429,800.00
2.56%
6.10%
12%
₹846,000.00
₹1,208,571.43

2,679,798
 1000000
Demand (in mil units)
1
1.2
1.4
1.6
1.8
2
2.2
2.4
2.6
2.8

3
3.2
3.4
3.6
3.8
4

CVP Analysis (outsourced Trucking/Logistics)

CM ₹5,100,000.00
Contribution Margin per unit ₹2.13
Fixed Cost ₹4,486,000.00
OI ₹614,000.00
NI ₹429,800.00
ROI 6.10%
BEP Units 2,111,059 14,777,412
Degree of Operating Leverage 8.31

Sensitivity of BEP to CM% (Base cas 1000000

BEP (# of Units in
BEP (# of Units in mil) mil) (Outsourced
CM%
(Base case) Trucking and
Logistics)
20% 3.20 3.20
22% 2.91 2.91
24% 2.67 2.67
26% 2.46 2.46
28% 2.29 2.29
30% 2.14 2.14
32% 2.00 2.00
34% 1.88 1.88
36% 1.78 1.78
38% 1.69 1.69
40% 1.60 1.60
Revenues (₹ million) Fixed Cost (₹ million) Variable Cost (₹ million) Total Cost (₹ million)
7 ₹4.49 ₹4.88 9.361
8.4 ₹4.49 ₹5.85 ₹10.34
9.8 ₹4.49 ₹6.82 ₹11.31
11.2 ₹4.49 ₹7.80 ₹12.29
12.6 ₹4.49 ₹8.78 ₹13.26
14 ₹4.49 ₹9.75 ₹14.24
15.4 ₹4.49 ₹10.73 ₹15.21
16.8 ₹4.49 ₹11.70 ₹16.19
18.2 ₹4.49 ₹12.68 ₹17.16
19.6 ₹4.49 ₹13.65 ₹18.14

21 ₹4.49 ₹14.63 ₹19.11

22.4 ₹4.49 ₹15.60 ₹20.09
23.8 ₹4.49 ₹16.58 ₹21.06
25.2 ₹4.49 ₹17.55 ₹22.04
26.6 ₹4.49 ₹18.53 ₹23.01
28 ₹4.49 ₹19.50 ₹23.99

Annual Demand (# of Capacity (# of units in

units in mil) mil)

2.40 4.00
2.40 4.00
2.40 4.00
2.40 4.00
2.40 4.00
2.40 4.00
2.40 4.00
2.40 4.00
2.40 4.00
2.40 4.00
2.40 4.00
Per Unit Cost (₹) Profit (₹ million)
CVP Analysis for Fly Ash B
9.36 -2.361
8.61 -₹1.94 BEP
30
8.08 -₹1.51 Revenues = ₹ 14.78 million
7.68 -₹1.09 # of Bricks = 2.11 million
25

Revenues, Costs, Profit (₹ million)

7.37 -₹0.66 Cost per Brick
7.12 -₹0.24 20
6.91 ₹0.19
6.74 ₹0.61 15
6.60 ₹1.04
6.48 ₹1.46 10

6.37 ₹1.89 5
6.28 ₹2.31
6.19 ₹2.74 0
1 1.2 1.4 1.6 1.8 2 2.2 2.4 2.6 2.8 3
6.12 ₹3.16
6.06 ₹3.59 -5
6.00 ₹4.01
Demand in millions

Revenues (₹ million) Fixed Cost (₹ million)

Total Cost (₹ million) Profit (₹ million)
 CVP Analysis for Fly Ash Brick Plant
BEP 10.00
Revenues = ₹ 14.78 million Revenues
# of Bricks = 2.11 million 9.00

8.00
Total Cost of Production
7.00

Per unit cost in Rs

6.00
Variable Cost
5.00

4.00
Fixed cost 3.00

2.00
Profit
1.8 2 2.2 2.4 2.6 2.8 3 3.2 3.4 3.6 3.8 4 1.00

Demand in millions

s (₹ million) Fixed Cost (₹ million) Variable Cost (₹ million)

st (₹ million) Profit (₹ million) Per Unit Cost (₹)