Feasibility Study on Establishing Community Radio in Nepal
-
Upload
bishnu-neupane -
Category
Documents
-
view
2.877 -
download
11
description
Transcript of Feasibility Study on Establishing Community Radio in Nepal
Business Development plan of Radio Begnas FM
Feasibility Study on
Establishing Community Radio Begnas FM 105.4 MHz in
Khudi, Kaski
Prepared By:
Bishnu Prasad Neupane
MBA III Trimester/2010 Batch
School of Business, Pokhara University
13th March, 2011
Business Development plan of Radio Begnas FM
ACKNOWLEDGEMENT
It is a matter of great pleasure for us to acknowledge all the people who helped us for the
successful completion of feasibility study of Community Radio Begnas FM as per the
requirement of group work of the third trimester syllabus provided by Masters in Business
Administration, Pokhara University.
First of all I would like to express my hearty gratitude and thanks to my instructor Dr. Deepak
Bahadur Bhandari for encouraging and guiding us in each and every step during the preparing
this feasibility analysis. I would like to thank him for providing the necessary suggestion. This
study helps us to understand the real situation of particular business in my \society and it has
been a great opportunity for us to explore the possibility within my community.
I would also like to thank Mr. Amrit Banstola for providing us the information regarding the
mass communication and journalism, process of program production. My heartfelt gratitude
goes to Mr. Govinda Devkota (Radio Sky FM 88.4MHz), Mr. Devendra Chhetri (Radio Safalta,
Pokhara), Mr. Dul Bahadur Kunwar (Community Radio Muktinath, Palpa), Mr. Ramesh Panthi
(Accountant-Radio Sky), Mr. Amrit Pandeya (Radio Namaste, Butwal), Mr. Raju Pariyar (Radio
Lekhnath),Mr. Saroj Adhikari (Radio Gandaki), Mr. Dhanu Ruchal (Radio Madanpokhara,
Palpa), Ms. Shanti Bhattarai (Himchuli FM), Mr. Yugraj Basyal (Ruru FM), Mr. Dinesh Khadka
(Butwal FM), Nepal Press Institute and Federation of Nepalese Journalists (Kaski) for providing
information to us without which this study could not be complete.
I am grateful to School of Business and Pokhara University Central Library family for providing
opportunity to accesses the required materials. I also thank to Mr. Uday Kumar Sharma, Mr.
Pankaj Karn and all my colleagues who helped us on preparing the report. And my special
thanks to Mr. Rishabh Gautam, Mr. Pradeep Sapkota, Mr. Anil Gupta and Mr. Anwesh
Bajracharya for their help.
Bishnu Neupane
School of Business, Pokhara University
Business Development plan of Radio Begnas FM
EXECUTIVE SUMMARY
Radio has been standing as a very powerful weapon in the society which can direct the time.
Radio broadcasting is the cheapest and quickest means of mass communications in Nepal. Radio
Begnas is a community radio going to be established in Lekhnath-12, Khudi, Kaski. The radio
station will be located at the center of Khudi, nearer to Pokhara University, just 1300 meter
inside the Prithivi Highway. The transmitting power of the radio will be 500 Watt and
broadcasted within the radius of 20 km.
Radio Begnas will be registered under government of Nepal, Ministry of communication as a
community radio. This will be registered as a organization which mostly focuses on developing
the community through mass communication. The project evaluation from the NPV, IRR, cash
flow, discounted cash flow and many more methods are providing the more feasibility to
establish the project near future. From the research report it shows there is the profitability in to
our investment i.e. 2, discounted payback period is 2.23 years, IRR is 47 % etc. From these
financial indicators we can say that the capital expenditure is viable to our project. The services
that we are selling of radio broadcasting capacity hour are projected from 50% to 70% which
gives measurable profit and are feasible on the basis of budget. The methodology of this research
design that we select in to our study is on the basis of the projected data.
The feasibility study of establishing an FM radio in Khudi, Kaski is best idea financially and in
the sense of serving people too. Since the coverage area of Radio Begnas is remote villages of
Kaski, Tanahau & Lamjung which are far from modern information and communication
technology; so it will help to access education & information to all. Another important fact, in
the present context, is people suffering from long power cut (load shedding) are listening radio as
the best means of communication. So it’s feasible and good to establish a 500 watt FM radio in
Khudi, Kaski.
Business Development plan of Radio Begnas FM
TABLE OF CONTENTS
ACKNOWLEDGEMENT
EXECUTIVE SUMMARY
CHAPTER 1
Introduction
1.1 Background of the study ....................................................................................................... 1
1.2 Objectives .............................................................................................................................. 6
1.3 Methodology .......................................................................................................................... 7
1.4 Limitation……………………………………...…………………………………………..12
CHAPTER 2
Organizational Description
2.1 Nature of business ............................................................................................................... 13
2.2 Organizational structure……………………………..…………………………………….16
2.3 Industry overview…………………………………………………………………………18
CHAPTER 3
Production Plan
3.1 Radio program production process……………………………………………………….19
3.2 Purposed schedule…………………………………………………………………………26
3.3 Input requirement………………………………………………………………………….26
3.4 Estimate cost sheet………………………………………………………………………...27
Business Development plan of Radio Begnas FM
CHAPTER 4
Financial Projection
4.1 Production and sales estimate ............................................................................................ .29
4.2 Revenue Budget …………………………………………………………………………..29
4.3 Projected income statement ………………………………………………………………30
4.4 Projected balance sheet …………………………………………………………………...31
4.5 Projected cash flow statement ……………………………………………………………31
CHAPTER 5
Fixed Capital Requirement
5.1 Fixed capital requirement…………………………………………………………………33
5.2 Working capital Requirement……………………………………………………………..34
CHAPTER 6
Financial Plan
6.1 Sources of financing………………………………………………………………………35
6.2 Capital structure…………………………………………………………………………...35
6.3 Loan drawing and payment schedule……………………………………………………...35
CHAPTER 7
Financial Analysis
7.1 Return on Equity…………………………………………………………………………..37
7.2 Return on assets…………………………………………………………………………...37
7.3 Time interest earned ratio…………………………………………………………………37
7.4 Break even analysis………………………………………………………………………..38
Business Development plan of Radio Begnas FM
7.5 Profit margin………………………………………………………………………………39
7.6 Net Present Value…………………………………………………………………………39
7.7 Internal Rate of Return…………………………………………………………………….40
7.8 Payback Period and discounted payback period…………………………………………..40
7.9 Profitability index…………………………………………………………………………41
CHAPTER 8
Conclusion and Recommendation
8.1 Conclusion………………………………………………………………………………....43
8.2 Recommendation ………………………………………………………………………....43
References
Annexes
Business Development plan of Radio Begnas FM
CHAPTER 1
INTRODUCTION
1.1 Background of the Study
1.1.1 Radio
Radio broadcasting is an audio (sound) broadcasting service, traditionally broadcast through the
air as radio waves (a form of electromagnetic radiation) from a transmitter to an antenna and thus
to a receiving device. Radio is the transmission of signals by modulation of electromagnetic
waves with frequencies below those of visible light.
1.1.2 History
Early history: The etymology (Origin of the word) of "radio" or "radiotelegraphy" reveals that it
was called "wireless telegraphy", which was shortened to "wireless" in Britain. The prefix radio-
in the sense of wireless transmission, was first recorded in the word radio conductor, a
description provided by the French physicist Édouard Branly in 1897.
The meaning and usage of the word "radio" has developed in parallel with developments within
the field of communications and can be seen to have three distinct phases: electromagnetic waves
and experimentation; wireless communication and technical development; and radio
broadcasting and commercialization.
A demonstration of wireless telegraphy took place in the lecture theater of the Oxford
University Museum of Natural History on August 14, 1894, carried out by Professor Oliver
Lodge and Alexander Moorhead. During the demonstration a radio signal was sent from the
neighboring Clarendon laboratory building, and received by apparatus in the lecture theater.
20th Century: On Christmas Eve, 1906, Reginald Fessenden used a synchronous rotary-spark
transmitter for the first radio program broadcast, from Ocean Bluff-Brant Rock, Massachusetts.
Ships at sea heard a broadcast that included Fessenden playing O Holy Night on the violin and
reading a passage from the Bible. This was, for all intents and purposes, the first transmission of
what is now known as amplitude modulation or AM radio. Charles Herrold started broadcasting
in California in 1909. The first radio news program was broadcast August 31, 1920 by station
Business Development plan of Radio Begnas FM
8MK in Detroit, Michigan, which survives today as all-news format station WWJ under
ownership of the CBS network. The first college radio station began broadcasting on October 14,
1920, from Union College, Schenectady, New York under the personal call letters of Wendell
King, an African-American student at the school. KDKA AM of Pittsburgh, Pennsylvania
(owned by Westinghouse) started broadcasting as the first licensed "commercial" radio station on
November 2, 1920.
1.1.3 Radio in Developing country:
Radio broadcasting is the cheapest and quickest means of mass communications in Nepal. In a
mountainous country like Nepal, radio broadcasting has proved to be a very effective medium
for disseminating information, educating people and entertaining the masses.
In the developing countries, the greater part of the people live in the land, are frequently isolated
by illiteracy and lack of transport. Effective communication with rural people and their active
participation in the life of their country are essential for developing society. Radio broadcasting
when skillfully used, has proved to be the most effective medium of communication with the far-
flung population.
This of course is not to say that radio is the simple answer to the problems associated with the
effective exercise of the combination. The use of radio encounters problems.
There is the technical problem of transmitter coverage and the quality of reception signals. There
are planning problems of appropriate human and adequate financial resources, and production
problems of quality and suitability of content materials. There is the difficulty of choosing the
appropriate program strategy to adopt. There are the organizational problems of co-ordination
between, and the do-it-alone approach followed by broadcasters, educators, and institutional
agencies responsible for public enlightenment.
Perhaps one self-made limiting factor to the success of radio in communication generally is the
usual ‘shot in the dark’ approach to programming which leaves the target audience ‘forgotten’
while programs are being planned; ‘remembered’ just before the programs go on the air; and
Business Development plan of Radio Begnas FM
‘forgotten’ again as soon as the programs have been broadcast. This particular problem raises the
issues of feedback, interaction and proximity of stations and producers to the consuming
audiences - issues which are basic to effective exercise of the communication.
1.1.4 Radio Broadcasting In Nepal:
In 1945, Maharaja Padma Shamsher initiated broadcasting with religious hymns and prayers.
Loudspeakers were introduced to facilitate Kathmandu-dwellers to listen to the broadcast and it
was the beginning of broadcasting in Nepal however, the general public was not allowed to own
a radio set.
In 1946, the ban on owning a radio set was lifted. First broadcasting in Nepali language was
done directly from Biratnagar in eastern Nepal. It was March 1950 when Nepalese turned into
their radios to listen to the voice from a station set up in their homeland.
The official radio broadcasting started on the 1 April 1951. Initially, a small wireless set of 250
watts was used as transmitter. During 1950s and 1960s Radio Nepal’s capacity was increased
significantly. Till August 1984, Radio Nepal used to broadcast through only one channel and the
duration of broadcasting was 13 hours 25 minutes per week.
Listeners of five development regions are now served in MW (100 kW transmitter) through a
national and four regional stations. Radio Nepal is on air for about 95 hours per week from the
central station and about 7 to 10 hours each from five regional broadcasting services. About 15%
of Radio Nepal’s total air time (14 hours per week) is devoted to education and informative
programmes, whereas little more than 20% (19.25 hours per week) is being occupied by
development oriented programmes. The highest percentage (more than 54%) time is given to
entertainment and eight percent to advertisement.
Radio Nepal, operating within the ministry of communication quite often presents government
policies, programmes and information that are not too different from government propaganda.
However it is necessary to a Nepali to listen to the national radio for news about the matters that
Business Development plan of Radio Begnas FM
concerns him or her. Although, All India Radio, Radio Peking, Radio Bangladesh, the external
services of BBC, OVA, NHK, Radio Moscow, Radio Sri Lanka and many others are received
almost everywhere in Nepal, Radio Nepal is very clearly the most frequently listened station.
The other are rather distant choices as they do not provide that much information which relates
Nepal.
Radio is taken as a serious communication device by those who possess receivers as well as by
those who do not. Radio listening appears to be a deliberate, serious, regularised pattern in the
daily activities of the owner and to some extend, among non-owners as well. Radio listening is
not a haphazard affair in Nepal; for some listeners it seems to fulfil the desire for an aware of
things beyond the village. As such, it may be that radio potential as an educational and
motivational tool for national integration and development has only been partially developed or
utilised.
Despite the tremendous advantages offered by the medium, to possess a radio for a rural Nepali
citizen is rather exceptional due to the fact that more than 75% of the population live under the
poverty line.
Mandatory licensing is supposed to be able to provide the actual number of radio receivers that
are in Nepal but it is extremely difficult to know how many of them really exist since there are
no official figures available. There are several findings about the numbers of exiting radio sets in
Nepal.
UNDP’s Human Development Report in 1995 estimated only three radio sets per one hundred
people in Nepal. However, Development Communication and Research Consultancy Group in
1990 estimated that 63.6% of Nepalese households have radio sets, a ratio of about 112 sets per
1000 people.
After the revolution in 1950-51 various kinds of media were introduced in Nepal and since then
they have grown rapidly in quantity.
1.1.5 Community Radio Begnas FM 105.4 MHz
Business Development plan of Radio Begnas FM
There is one sub metropolitan city and a municipality in Kaski district. An AM radio (Radio
Nepal Regional broadcasting) station and 13 FM radio stations are currently on air in Pokhara
sub metropolitan city. An FM Radio station in Lekhnath municipality is in under construction.
Radio Begnas is a community radio going to be established in Lekhnath-12, Khudi, Kaski. The
radio station will be located at the center of Khudi, nearer to Pokhara University, just 1300 meter
inside the Prithivi Highway.
The transmitting power of the radio will be 500 Watt and broadcasted within the radius of 20 km.
It is expected to cover most of the parts of Kaski, Tanahau, Lamjung and Syangja districts. The
height of the tower will be 30 meters from the ground-level and there will be six dipoles.
The main focus of Radio Begnas is as follows;
• Massive dissemination of Information at the root level.
• Substantial improvement in:
–Rural Education
–Health Care
–Agriculture
• Development of mainly youth based human resources in terms of:
–Audio program producers
–Journalists
–Radio technicians
• The creation of Community based awareness groups on socio-economic issues like:
– Environment pollution
– Adult literacy
– Ethnic discrimination etc.
• Create mass level awareness.
• Focus on educating people through various programs.
• Trained work force.
• Viable two way communication among the listeners and the broadcasters.
• Entertain people through music, radio drama, etc.
Business Development plan of Radio Begnas FM
• Attempt to provide prompt and accurate coverage of all national and international news
including political, economic and social highlights in a balanced and objective manner.
Radio will be the most suitable means of disseminating information and providing entertainment
to masses in Kaski and neighbor districts. It will attempt to safeguard the basic principle of
public interest and the public's right to be informed as the public broadcaster of the community.
1.2 Objectives
The general objective of this study is to understand the patterns and experience the real life
situation. However the specific objectives of this feasibility analysis include:
1. To produce a project report as a partial fulfillment of requirement for
completion of MBA.
2. To conduct a financial feasibility of establishing Radio Begnas FM in
Lekhnath, Kaski.
3. To gain practical knowledge about the subject matter and learn how it is
conducted for a real organization.
Business Development plan of Radio Begnas FM
1.3 Methodology of the study
Research methodology is the systematic and organized effort to investigate a specific problem
that needs a solution. This process of investigation involves a series of well thought out activities
of gathering, recording, analyzing and interpreting the data with the purpose of finding answer to
problem. Thus, the entire process by which we attempt to solve problem is called research, while
'methodology' is the research method used to test hypothesis. A sound and systematic
methodology is required to carry out any study, if it is to be worthwhile.
Methods for field visits
We the group members visited the following FM radios in different areas of western Nepal for
collecting necessary information and observe the contemporary financial situations of the local F
M Stations. This type of field visit and observations are used as primary way of data collection.
Field visit helped us to find out accuracy, validity and suitability. The justification on the present
study cannot be obtained without help of proper research methodology. For the purpose of
achieving the objectives of study, we applied appropriate methodology in particular situation
depending upon the nature of task.
We have visited both the commercial and community types of FM radio stations in Kaski
district. Following approaches are used on visiting FM radios;
� Interaction with station managers, technician chiefs and program chiefs of Radio stations,
� Interaction with engineers,
� Field observations,
� Informal interviews,
� Institutional survey, etc.
Business Development plan of Radio Begnas FM
Research design
The research design is the plan structure and strategy for investigation of the facts in order to
arrive at conclusion. The plan is the overall scheme of program of the research. It includes
program of the research. This research design is a plan to obtain the answer of the question
through analysis of data.
To achieve the goal of the study, the study will use the available data from the primary and
secondary sources. Analytical as well as descriptive research design will be adopted to clarify the
contemporary situation of the FM radio through presentation and analysis of various data using
various financial tools.
The design may be a specific presentation of the various steps in the problems, conceptual
clarity, methodology, survey of literature and documentation, bibliography, data collection,
testing of the hypothesis, interpretation, presentation and tracing conclusion. Generally, a
common feasibility design possesses the eight basic elements viz.
1. Introduction
2. Methodology
3. Organizational Description
4. Service Plan
5. Financial Projection
6. Financial Requirement
7. Financial plan
8. Financial Analysis
9. Conclusion and recommendation.
Business Development plan of Radio Begnas FM
I. Preliminary research
The team of feasibility study collected information related to FM radio station through visiting
FM stations in Pokhara, internet and through interview with Audio professionals and technicians.
Researchers team understood various and essential aspect of community locl radio which helped
to do the research smoothly. Finally, researcher developed a research matrix to plan the research.
It includes developing of research questions, information required, and sources of information.
ii. Secondary research and observation study
Secondary research was necessary for project to become familiar with the concept and different
aspects of establishing FM radio based on community and service oriented. There the researcher
team has also learned various aspects that needed to be taken into consideration for completion
of the research.
Observation study constituted the initial study, which involved the observation of process and the
problems associated with the establishment of teaching hospital
iii. Exploratory research
In exploratory research, the researcher conducted in-depth interviews with the media persons
related to electronic and print medias of Pokhara, Syangja, Palpa, Gulmi and Rupendehi. We also
The information obtained from these exploratory researches provided data for the quantitative
research work. We developed questionnaires with the information obtained from these researches
and secondary data.
iv. Questionnaire development
For the research, researcher developed a single set of an information-generating questionnaire,
which would fulfill purposes/objectives of our study. The questionnaire is expected to provide
Business Development plan of Radio Begnas FM
adequate information for better analysis and development of different strategies and overcome
weaknesses.
v. Method of data analysis
The data collected from the sources are classified, tabulated and analyzed according to the needs
of the research. Necessary tables, graphs and charts were constructed to fit the data obtained
from the sources.
vi. Data analysis tools
Different analysis tools were used for data analysis, like SPSS 11.5, MS Excel. They are
highlighted in the following table:
Software Statistical Tools
MS Excel Graphs
Charts
vii. Data analysis and findings
After collecting all the information from different sources, we analyzed the data. After analysis,
we developed various recommendations, which are the outcome of the formally conducted
research and in-dept study and interviews. Thus, this was how the researcher approached to
complete the overall study.
Business Development plan of Radio Begnas FM
viii. Sources of data/information
The researcher collected all the information needed for research study from different authentic
sources and have categorized them as primary and secondary data. They are briefly introduced
below:
i. Primary data
Primary data are those collected by the researcher on the concerned topic, which are original in
nature. While studying about establishing a community radio, we came across primary data from
different sources like: direct in-depth interviews with station managers of other radio stations in
order to collect various information regarding financial and other operating processes of radio
program production and media management.
ii. Secondary data
Secondary data are those collected by the researcher on the concerned topic, which are not
original in nature or are originally collected for some other purposes. The main sources of
secondary data were: statistical publication of different media houses and organizations through
websites, different journals and business magazines etc.
Business Development plan of Radio Begnas FM
1.5 Limitation of the Study
Some of the limitations of study are listed below:
1. This study is mainly concerned to only establishing community radio, not on the quality
of program production
2. Information we gathered is relied mostly on the interaction with had with media persons
and managers, we could not access to the equipment suppliers. Managers hesitated to give some
information related to the salary of RJs.
3. The price is based on secondary data from the respective websites on net, article,
newspapers.
4. Lack of sufficient resources.
5. In this study only selected tools and technique are used.
6. This study is conducted only for suggestion not for directing.
Business Development plan of Radio Begnas FM
CHAPTER 2
ORGANIZATIONAL DESCRIPTIONS
2.1 Nature of Business: Introduction and Importance
In the context of developing countries, where literacy rate and per capita income is extremely
low, print media and television for the most is a remote reality, radio broadcasting is the leading
and most vital media.
Radio, television and the newspaper are the best known media of mass communication in
developing countries. None of these, for one reason or the other, is successfully accessible to the
rural population, In the case of the newspaper, for example, it could not be used for direct
communication with rural communities because such communities usually are illiterate.
Television too, has not been much of a help. Stations are built in cities far removed from the
rural population. The cost of receiving sets has been prohibitive because of it’s high prices. No
developing country as of now can afford to establish sufficient television stations to ensure an
equitable access for all it’s citizens.
The Internet is in its infancy in developing countries. In most of the developing countries,
Internet development has only begun to take off in 1995. Only the intellectual elites have an
access to it and they remain a very tiny part of the population.
Development of electronic media in developing countries is uneven, both within and among
countries. Often, this media is introduced into a country by some commercial companies and the
growth has been fastest where there is a commercial push. Often, this means that only the limited
numbers of elite from the major cities have an access to it.
Developing countries have many barriers to growth of electronic media like with many other
media. Besides the major barriers of high rate of illiteracy coupled with the inaccessibility due to
poverty, developing countries face many other barriers. First, there is a lack of infrastructure. We
Business Development plan of Radio Begnas FM
know that even as we celebrate the 100th anniversary of the emergence of the telephones as a
tool in human communication, more than half of the global population does not know what is
like to use a telephone. The technology of the typewriter has still to reach great majority of
humanity.
Secondly, the high costs of access to information. Whether information comes to us as databases,
magazines, newspapers or pay TV, income differentials determine its availability.
Telecommunication charges are also extremely high and for the majority of the population
purchasing the equipments for electronic media is a remote dream. There is also low computer
literacy and low personal computer (PC) penetration even among the elites.
These are the some of the present basic odds of the developing countries which are likely to
hamper the development of electronic media however, these odds are likely to be lowered over
time as developing countries develop.
Considering all the odds with other media, radio appears to be the best solution of mass
combination for the rural communities of the developing countries. Radio is cheap and it is
widely owned. Apart from the well-known characteristics of radio, such as it’s ability to beat
distances and literacy barriers, as well as it’s immediacy and individualistic touch, it is the only
medium of mass communication with which the rural communities are familiar.
In the developing countries, the greater part of the people live in the land, are frequently isolated
by illiteracy and lack of transport. Effective communication with rural people and their active
participation in the life of their country are essential for developing society. Radio broadcasting
when skilfully used, has proved to be the most effective medium of communication with the far-
flung population.
Communication between people for vast majority of the population is a matter of oral word. Print
media is available but only a limited number of people are sufficiently affluent or literate enough
to use them. Even those who can read and comprehend the reading materials have no access to
them due to the high costs and there is big problem of distribution. Printed materials are a luxury
to many people. All newspapers are printed and distributed in towns and they play a very little
Business Development plan of Radio Begnas FM
part in the daily affairs of the population at large. So, radio is the best alternative of mass
communication in Nepal.
Radio is taken as a serious communication device by those who possess receivers as well as by
those who do not. Radio listening appears to be a deliberate, serious, regularized pattern in the
daily activities of the owner and to some extent, among non-owners as well. Radio listening is
not a haphazard affair in Nepal; for some listeners it seems to fulfill the desire for an aware of
things beyond the village. As such, it may be that radio potential as an educational and
motivational tool for national integration and development has only been partially developed or
utilized.
2.2 Organizational Structure:
The organizational structure of Radio Begnas will
The production department of this
staff and on air personalities like hosts, co
you call them.
The production department makes certain that all program contents and commercials are timely
produced and lined up for timely broadcast. The Operation department supervises the smooth
Program/ News Chief
News ReadersNews writers/
collectorReporters
Business Development plan of Radio Begnas FM
The organizational structure of Radio Begnas will be as below;
this radio station consists of the radio production staff, operations
like hosts, co-host, anchors, disc jockeys or radio jockeys whatever
The production department makes certain that all program contents and commercials are timely
produced and lined up for timely broadcast. The Operation department supervises the smooth
Board of Directors
Chairman
Station Manager
ReportersProduction
Department
Radio Jockeys/
Hosts
Technician Chief
Technicians/ Djs
Marketing Manager
Marketting Representatives
Business Development plan of Radio Begnas FM
radio station consists of the radio production staff, operations
host, anchors, disc jockeys or radio jockeys whatever
The production department makes certain that all program contents and commercials are timely
produced and lined up for timely broadcast. The Operation department supervises the smooth
Marketing
Marketting Representatives
Accountant
Business Development plan of Radio Begnas FM
operations of the radio station. The on-air personalities deliver the contents to the listeners and
are the face of the radio station. The production department is also assisted by the traffic
managers who plan the broadcast of these commercials on air.
Marketing department is responsible for generating direct revenue for the radio station by selling
air time to advertisers. The department consists of several persons who perform different
functions ranging from the head who supervises the functioning of the entire department to make
certain the revenue target are met. The department has a large number of sales men who
approach advertisers and prospective advertisers to sell the air time and to negotiate the terms
and the payment details with these advertisers.
The accounts/finance department of a radio station set up is in- charge of handling the all
revenues and expenses in a controlled environment. The primary function this is to ensure that
dues from advertisers are collected in a timely manner and similarly all payments like utilities,
salary and others are done on time.
It also handles all legal or financial matters relating to mobilizing funds from the market. The
finance department additionally looks after departments like auditing and taxation.
The station Manager of a radio station is responsible for smooth management of processes of the
radio station. Functions include managing logistics, managing proper housekeeping, handling
security measures at the radio station, handling office boys, arranging for traveling, boarding and
lodging for radio station officials and guests.
Business Development plan of Radio Begnas FM
2.3 Industry Overview:
Media industry is very vivid and one of the most versatile industry. Mass media, as it is called
theoretically, is one of the most influential industries as it is directly connected with the mass
audience. The main work of Media industry is to provide information and generate public
opinion. The Media industry first started with the mass distribution of newspapers and
magazines. Today, the definition of media has changed and media has many sub forms like
Broadcasting with the help of TV and radio, Entertainment with use of audio visuals -films and
videos, internet that includes blogs, forums, music, news, then Publishing of Books, papers,
magazines, and it also includes postal mail, telephony and other interactive Media. The media
has various purposes like providing entertainment, education, Advocacy among others. Thus the
scope of a Career in media industry is vast.
Business Development plan of Radio Begnas FM
CHAPTER 3
PRODUCTION PLAN (SERVICE PLAN)
3.1 Radio Program Production Process
3.1.1 The People Involved in Radio Program Production
The size of the radio station and / or the budget often dictates the number of people involved and their
job functions, but regardless of whether one person fulfills all the roles, or there is a greater degree of
specialization with different people assigned to each, the main skills and the roles needed to produce a
commercial, and there are essentially only four:
1. The Scriptwriter: having the writer present at the session often helps clear up any
misunderstanding with the written word.
2. The Sound Engineer: a good experienced technician with a good pair of ears can make
everything work quickly and smoother.
3. The Producer: the person in overall charge of achieving the end result.
4. The Voice Over(s): Good casting is essential and knowing the capabilities of each voice helps.
All the above roles can be, and often are, completed by one person, and sometimes for larger
campaigns with larger budgets, present in the studio can also be:
• The Client(s): whose money is being payed for the session.
• The Media Sales Representative(s): responsible for booking the commercial airtime.
• The Advertising Agency: either in a creative capacity as the writer and producer or as an advisor
to the client.
So present in the studio to record a radio commercial or a number of commercials for any advertising
campaign can range from one person to several.
Business Development plan of Radio Begnas FM
Radio Program Production Process:
Feedback
Writing Script
Interview with Experts
In- Depth Study
Editing
Issues/ Problems/Events Environment
Program Concept
Program Script
Discussion Points/Agenda of
Radio Program
Program Production
Finalized Program
Broadcast Program
Edited Interview
Business Development plan of Radio Begnas FM
3.1.2 Before the Recording
Before any recording begins there are a few steps well worth doing if not essential that will not only
save time later as the recording progresses but will ultimately lead to a better end product. Some of this
is preparation and some skills and technique that need practice and experience.
• Read the script again (and this applies as much to the scriptwriter)
• If not the writer, discuss the script with the scriptwriter so that all understand it.
• Look out, or pre-record any sound effects.
• Listen to the options, choose and set up music tracks.
• Cast the voice artists carefully, and give them as much information about what’s required and as
much encouragement as they need.
• Try and create a good atmosphere in the studio, relaxed and open for ideas.
• Be prepared to enjoy it!
Recording any audio is as much about the people involved in the process as it is about the technicalities,
technology and equipment.
3.1.3 The Recording Process
The recording studio is the sound engineer’s domain and a good sound engineer will have studio skills
including both sound recording and editing skills and be familiar with different types of production
software and their capabilities. They will add considerably to the whole production and should:
• Contribute ideas including suggesting the sound effects and music available.
• Suggest the best way to record the audio.
• Consider other places to record the audio that might help the final production.
• Ensure all the equipment is working efficiently.
• Pick the right microphones for the number of voices involved.
• Set up the studio and provide all the facilities.
An experienced sound engineer or technician make a recording session run smoothly and contribute
greatly to the production.
Business Development plan of Radio Begnas FM
3.1.4 Creativity in the Studio
Most production companies and studio personnel will acknowledge that without a good script, making a
good commercial is difficult if not impossible. Conversely a good script can be wasted by poor
production. A good script or series of scripts and a recording session when all the above is in place can
produce some effective and creative audio.
3.1.5 Radio Script : How to Write a Radio Script?
Building anything without the right tools and equipment is difficult. Happily there are only a few
essential building blocks that make writing a radio script easier.
A major part of most creative work at some stage involves writing a script, or at least putting
some ideas down on paper or its technological equivalent. This is especially true where more
than one person is involved, with the exception obviously of various forms of improvisation. It’s
certainly true in radio and applicable to the production of any audio be it radio commercials,
station and programme promotions, news bulletins, indents and inserts, or any programming
features.
3.1.6 The Rules of the Production Process
There are no ‘golden rules’ that must be adhered to in audio production bar the obvious technical
considerations, and it’s certainly true to say for any area of creative output that what works for one
person, may only serve to hinder another. Producing something out of almost literally nothing is the
alchemy of ideas that has both puzzled and delighted the artistic community and its sponsors for
thousands of years. Creativity exists in many forms, and a mixture of experience and inspiration can be
as effective as naivety and enthusiasm is productive
Business Development plan of Radio Begnas FM
3.1.7 Making a Start.
That said the hardest part of a great many artistic adventures is the beginning; the first brush stroke or
the first word, after that the process often takes on a momentum of its own. Considering a lot of day to
day radio production is the solution to a set task or problem:
• Write a promotion to promote x, y, or z.
• Make a program about a, b, or c.
• Construct a feature to investigate 1,2 and 3
• Produce a radio commercial for xxxxx.
In each of these cases there are parameters already laid down as and this is often a great place to start.
Write these down either as a brief:
• Who are we talking to?
• What do want them to do?
• Why should they do it?
Or outline the guidelines and objectives as written goals, and it’s important to write them down.
• How long is the feature, promotion, program to be?
• What are the main objectives?
• Who’s involved or could be involved?
• Who’s the main audience?
• What’s the main story, or the point of the piece?
Business Development plan of Radio Begnas FM
3.1.8 Tools of the Trade
Of course this is in effect all ‘Brainstorming,’ and it can be done as effectively individually as it can be
collectively. Many radio scriptwriters have found through writing, rejecting ideas that don’t work, and
embracing ideas that do, and a certain amount of trial and error, the best way for them not only to
begin writing but to get to the script. This will often involve thinking of the tools and materials available
to them, and considering ideas of the best way to use them. The tools of the radio trade are:
• Solo Voice: Radio is often at its best as a one-to-one story telling medium. What’s the story
being told, and who is it being told to??
• Sound effects: A sound effect chosen at random can start the process.
• Music Tracks: Music can be a great catalyst for ideas, just check there’s a relevant broadcast
license.
• Vox Pops: Ideas come for the most unusual places, ask people in the street their thoughts.
• Interviews: When writing about specifics more knowledge help so interview someone who
knows.
• Chance: be aware of the possibilities and trying something just to see what happens.
Louis Pasteur once famously said “Chance favors the prepared mind,” and starting to write a radio script
can happen more easily when the mind instead of finding difficulty in writing, is prepared to give
creativity a chance. Laying out the tools of trade, or just starting to use some of them often hastens the
process.
3.1.9 Developing the Idea
Business Development plan of Radio Begnas FM
Many people struggling to start a radio script or any creative project, often have a high level of self
censorship and reject numerous potentially workable ideas. On the other hand, many working creative
people whose job it is to continually come up with and develop new ideas, often propound the
underlying idea, that “There are no such things as bad ideas and good ideas, there are just ideas, and
some may be worth developing or thinking about more than others."
Mass media campaigns to influence public attitudes and behaviors in the area of mental health must
consider cost-effectiveness, which is based on actual costs, the number of people reached (exposures),
and the impact of the program on the individual. Cost per exposure is a critical factor. The authors
review their experience in developing media programs in several broadcast formats and in print. Their
experience suggests that an effective television production has a very high per-exposure cost and that
radio is a more cost-effective way to present health messages. Radio programs also have the advantage
of reaching people in their homes or cars or at work. Brief segments may be particularly cost-effective
because they can be can be inserted between programs during prime-time hours. Print media—
newspapers, magazines, and newsletters—can be cost-effective if magazine or newspaper space is free,
but newsletters can be costly due to fixed postage costs. One advantage of print is that it can be reread,
clipped out, copied, and passed on.
Writing the script is only the first stage in the process of making a radio commercial. Good production
can make an award winning ad, and bad production ruin it.
Putting together a radio commercial once the script is written requires skill, a good pair of ears, and
some dedication. Understanding all the constituent parts and how they might interact with each other
becomes easier with a basic understanding of each.
3.2 Proposed Schedule of broadcasting
The schedule of the radio programs takes 18 hour per day for 365 days a year. Schedule is maintained
such way that 3 hours could be sold and 1 hour for sponsorship per day.
Business Development plan of Radio Begnas FM
3.3 Input requirements and cost sheet
This section provides equipment guidelines for a complete local-production capable public radio
station with interconnection to the Public Radio Satellite Systems.
Pricing is given for the following power levels of transmission equipment:
• Pricing for Class A transmission system
• Pricing for Class A transmission system: This system is based on the FCC docket 80-90 for a
maximum ERP of 3 KW, HAAT being 328' or 100 meters maximum. The priced system includes
a 3.5 KW transmitter, 350' tower and 350' of 1-5/8" Heliax transmission line, and a 2-bay
circularly polarized antenna with a 5 KW maximum input power.
• Pricing is given for the following:
S.N Particulars
1
2
3
4
5
6
Radio Transmission Systems
Radio Test Equipment
On-Air Control Room (Radio)
Production Control Room and
Associated Studio (Radio)
News Control Room (Radio)
A. Radio Transmission System
The total cost for Radio Transmission System is found to be Rs.470,569. Standby power generator and
UPS - Cost dependent upon transmitter power and air conditioning need – Rs.10,000 to Rs.45,000.
B. Radio Test Equipment
Business Development plan of Radio Begnas FM
The cost for Radio Transmission System STUDIO is Rs. 71,850 and that of XMTR is Rs. 6,350
C. On-Air Control Room (Radio)
The cost for On-Air Control Room is found to be Rs. 163,945.
D. Production Control Room and Associated Studio (Radio)
The cost for Production Control Room and Associated Radio is calculated to be Rs.104,430.
E. News Control Room (Radio)
Similarly, the cost for News Control Room is calculated to be Rs. 75,270 and Associated Studio (Radio)
is Rs. 65000.
Office Equipment & Furniture 100,000.00
furniture like chair, table etc 1 100,000 100,000.00
Installation 75,000.00
installation of office equipment 1 75000 75,000.00
Pre operating Expenses
30,000.00
registration, legal and feasibility study 1 30,000 30,000.00
With the program software of Rs. 250,000 the total fixed assets investment is Rs. 1457,414.
Manpower requirement
Staffs
Particulars No’s
station manager 1
accountant 1
technical manager 1
Business Development plan of Radio Begnas FM
technical assistant 5
receptionist 2
anchor 8
peon and guard 3
Sub Total 21
.
Business Development plan of Radio Begnas FM
Chapter 4
FINANCIAL PROJECTION
4.1 Production and sales estimate
We are in the assumptions that the normal capacity of the radio is 18 hours per day and it operates 365 days in a year. The figure outlines the total sales of Rs.7,865,000 with advertising, program time sold and from sponsorship program.
Details of service
Particulars assumption unit Annual
Capacity
Advertising 25% of total time 1,643
program time sold 3
hr per day 1,095
Sponsorship 1
hr per day 365
Total
2,738
remaining time allocated for musical songs, news , live telecast and official
media
4.2 Revenue budget
Projected sales
capacity 50% 55% 60% 65% 70% year
Particular 1 2 3 4 5
Total sales revenue
3,932,500.00
4,325,750.00
4,719,000.00
5,112,250.00
5,505,500.00
4.3 Projected income statement
S.N. Particular schedule
EAT(G-H)
The given income statement provides the earnings after tax for the operating five years.
The income is increasing in trend.
75%
80%
85%
90%
95%
100%
1 2 3
years
-
1,000,000
2,000,000
3,000,000
4,000,000
5,000,000
6,000,000
1 2
sales amount
sales projection
Business Development plan of Radio Begnas FM
4.3 Projected income statement
year 1 year 2 year 3
269,794
637,419
989,478
1,330,376
The given income statement provides the earnings after tax for the operating five years.
The income is increasing in trend.
4 5
years
sales
Miscellineous
Sponsorship
Program Time Sold
Advertising
3 4 5years
sales projection
sales
Business Development plan of Radio Begnas FM
year 4 year 5
1,330,376
1,663,518
The given income statement provides the earnings after tax for the operating five years.
Business Development plan of Radio Begnas FM
4.4 projected balance sheet
The balance sheet shows the total assets equal total liabilities and owner’s equity.
Year Of Operation 0 1 2 3 4 5
Total Assets (A+B)
1,800,000
2,099,607
2,618,061
3,468,061
4,634,910
6,106,705
Total Capital &
Liabilities(A+B+C+D+E)
1,800,000
2,099,607
2,618,061
3,468,061
4,634,910
6,106,705
4.6 projected cash flow
A cash flow statement shows the total cash inflow and cash outflow. A business’s net cash flow generally differs from its accounting profit because some of the revenues and expenses listed on the income statement were not received or paid in cash during the year. The relationship between net cash flow and net income can be expressed as follows:
Net cash flow = Net income – Non-cash Revenue + Non-cash charges
The primary examples of non-cash charges are depreciation and amortization which reduces net income but are paid out in cash, so we add them back to net income when calculating net cash flow. The projected cash flow statement for five years is given as below:
particular years
1 2 3 4 5
Opening Cash Balance
342,586.00
677,338.35
1,436,661.40
2,460,620.34
3,751,246.04
Total cash received in year 830,500.00
1,213,850.00
1,595,715.00
1,975,872.25
2,354,065.59
total cash usage in year 495,747.65
454,526.95
571,756.06
685,246.55
796,130.19
net cash flow during the
year
334,752.35
759,323.05
1,023,958.94
1,290,625.70
1,557,935.40
Closing cash balance
677,338.35
1,436,661.40
2,460,620.34
3,751,246.04
5,309,181.44
-
1,000,000
2,000,000
3,000,000
4,000,000
5,000,000
6,000,000
1 2
amount
Cash Flow
-
1,000,000
2,000,000
3,000,000
4,000,000
5,000,000
6,000,000
1
Business Development plan of Radio Begnas FM
3 4 5
year
Cash FlowNet cash flow
Cash balance at end
2 3 4 5
year
Projected cash flow
Business Development plan of Radio Begnas FM
Net cashflow in year
Cash balance at end of year
FIXED CAPITAL REQIREMENT
5.1 Fixed capital requirement
The fixed capital is the permanent capital that is very essential to run the business. The fixed
capital requirement for any project deals with the fund require for the given time period that is
fixed and do not varies with the condition. The detail of all fixed cap
feasibility analysis of Benas Radio is Rs. 1,457,434.
5.2 Working capital Requirement
0
200000
400000
600000
800000
1000000
1200000
1400000
Building &
Civil Works
Plant &
Machinery
Business Development plan of Radio Begnas FM
CHAPTER 5
FIXED CAPITAL REQIREMENT
capital is the permanent capital that is very essential to run the business. The fixed
capital requirement for any project deals with the fund require for the given time period that is
fixed and do not varies with the condition. The detail of all fixed capital required for the
feasibility analysis of Benas Radio is Rs. 1,457,434.
5.2 Working capital Requirement
Plant &
Machinery
Office
Equiptment
& Furniture
Installation Pre
operating
Expenses
Business Development plan of Radio Begnas FM
capital is the permanent capital that is very essential to run the business. The fixed
capital requirement for any project deals with the fund require for the given time period that is
ital required for the
Business Development plan of Radio Begnas FM
The working capital requirement for any project deals with the liquid funds needed to run the day
to day operational activity within the organization. How much working capital is required for
running the business, it depends upon the nature of business. The working capital requirement
for our feasibility analysis is given as below:
Year Of Operation 1
2 3 4 5
Current Assets ( Except
Cash)(a)
327,708
360,479
393,250
426,021
458,792
Total Current Liabilities
(b)
132,000
132,825
133,774
134,865
136,120
Net Current Assets /
Working Capital
Requirements ( a-b)
195,708
227,654
259,476
291,156
322,672
CHAPTER 6
FINANCIAL PLAN
6.1 Sources of financing
Main sources of financing are given below:
1. Long term loan 2. Capital stock
6.2 Capital structure
60% of the investments are acquired from owner’s equity (Rs. 1,080,000) and remaining Rs. 720,000 is debt.
6.3 Loan drawing and payment schedule
Loan will be drawn from bank at the rate of 16% for 5 years. The interest and principle payment will be monthly. The installment per month will be Rs. 17,509.
1 year 2
Interest
107,921
90,317
Principle
102,187
119,791
Total 210,108
210,108
0
20000
40000
60000
80000
100000
120000
140000
160000
180000
200000
1 2 3
Business Development plan of Radio Begnas FM
Main sources of financing are given below:
investments are acquired from owner’s equity (Rs. 1,080,000) and remaining Rs.
6.3 Loan drawing and payment schedule
Loan will be drawn from bank at the rate of 16% for 5 years. The interest and principle payment llment per month will be Rs. 17,509.
3
4
5
90,317
69,681
45,490
17,131
119,791
140,427
164,618
192,977
210,108 210,108
210,108
210,108
4 5 6
Interest
Principle
Business Development plan of Radio Begnas FM
investments are acquired from owner’s equity (Rs. 1,080,000) and remaining Rs.
Loan will be drawn from bank at the rate of 16% for 5 years. The interest and principle payment
Business Development plan of Radio Begnas FM
CHAPTER 7
FINANCIAL ANALYSIS
7.1 Return on Equity
The Return on Equity (ROE) measures the return on the owner’s investment in the firm higher portion of return on equity is better for owner.
Year Of Operation Av
erage 1 2 3 4 5
Return On Equity
(%) 28.81% 19.99% 32.08% 33.24% 30.89% 27.86%
7.2 Return on assets
Business Development plan of Radio Begnas FM
The Return on Asset (ROA), which is often called the firm’s return on total assets, measure the overall effectiveness of management in generating profit with its available assets. The higher the firm’s return on assets the better it is doing in operation and vice versa.
Year Of Operation Av
erage 1 2 3 4 5
Return on Assets (%) 31.48% 14.99% 30.36% 37.79% 38.36% 35.89%
7.3 Time interest earned ratio
Time Interest Earn (TIE) is also called interest coverage ratio. The TIE ratio measures the extent
to which interest on debt capital is covered by EBIT. It is calculated by dividing EBIT by interest
charges.
IE
EBITTIER =
Where TIER = Time interest earned ration
EBIT = Earnings before interest and taxes
IE = Interest expenses
Year Of Operation Av
erage 1 2 3 4 5
Interest Coverage Ratio (Times )
41.03
4.3
10.4
19.9
40.0
130.5
7.4 Break even analysis
The break-even point is the level of sales at which all revenue will be equal with all expenses and net income will be zero.
Year Of
Operation Average 1 2 3 4 5
Profit Volume Ratio 98% 98% 98% 98% 98% 98%
Total fixed cost 3,325,844
3,506,775
3,399,958
3,312,411
3,238,037
3,172,041
Break Even sales 3,389,002
3,566,634
3,460,679
3,374,834
3,302,889
3,239,974
Business Development plan of Radio Begnas FM
7.5 Profit margin
Year Of Operation Av
erage 1 2 3 4 5
Net Profit Margin (EAT / Sales) %
19.76% 6.86% 14.74% 20.97% 26.02% 30.22%
2,900,000
3,000,000
3,100,000
3,200,000
3,300,000
3,400,000
3,500,000
3,600,000
1 2 3 4 5
amount
year
Break even sales
total fixed cost
break even sales
Business Development plan of Radio Begnas FM
7.6 Net Present Value
Net Present value is the amount different between present value of cash inflow and cash outflow
of the project.
Net present value (NPV) method relies on discounted cash flow techniques.
For finding the NPV we follow following process:
1. Find the present value of all cash inflow and outflow.
2. Subtract the investment amount from the sum of total present value..
3. If the NPV is positive, the project should be accepted, while if the NPV negative, it
should be rejected.
The formula for finding the NPV is:
NPV = TPV- NCO
Where TPV = total present value
NCO = net cash outflow
NET PRESENT VALUE
0.00%
5.00%
10.00%
15.00%
20.00%
25.00%
30.00%
35.00%
1 2 3 4 5
Profit Margin
Profit Margin
Business Development plan of Radio Begnas FM
1,851,397.22
Analysis:
Since NPV is positive, project is beneficial to
initiate. That means present value of future cash
flows is greater than initial cash outlay.
7.7 Internal Rate of Return
The Internal Rate of Return (IRR) is the discounting rate that makes present of cash flows equal to the present value of the cash outflows of the project. The IRR is 46.61%.
IRR % = LR + ( PV at LR - Investment ) X ( HR % - LR% ) ( PV at LR - PV at HR ) = 46.61%
7.8 Payback Period and discounted payback period
The payback period is the expected number of year required to recover the investment of the
project. and discounted payback period is defined as the expected number of years required to
recover the original investments where expected cash flows are discounted by the project’s cost
of capital.
Payback period 2.23 years
Discounted PB Period 2.78 yrs
Analysis: Since the non discounted payback period is less than projected life period accept the project. That means project can recover its initial cash outlay with in the period of 2.23 years
Analysis: Since the discounted payback period is less than projected life period of the project accept the project. That means project can recover present cash outlay discounting in a 16% cost of capital.
Business Development plan of Radio Begnas FM
7.9 Profitability index
The profitability Index is defined as the ratio of TPV to NCO i.e.
Profitability Index (PI) = TPV/ NCO
profitability index = 2
analysis: Since profitability index is greater than 1 accept the project. That means present value of future cash flows is more than initial cash outlay.
CHAPTER 8
CONCLUSION AND RECOMMENDATION
8.1 Conclusion
From the above research feasibility analysis we find that the projections we have made to
evaluate the projects in terms of different financial criteria are feasible. From the projected data
we have taken in to account from the different sources are more appropriate to our project
Business Development plan of Radio Begnas FM
evaluation. The project evaluation from the NPV, IRR, cash flow, discounted cash flow and
many more methods are providing the more feasibility to establish the project near future. From
the given research report we can say that there is the profitability in to our investment i.e. 2,
discounted payback period is 2.23 years, IRR is 46.61% etc. From the given financial indicator
we can say that the capital expenditure is viable to our project. The services that we are selling of
capacity are projected from 50% to 70% which gives measurable profit and are feasible on the
basis our budget. The methodology of our research design that we select in to our study is on the
basis of the projected data that are from secondary sources and primary sources.
The place that we have selected in to our study is also feasible because it has located near the
sub-metropolitan city Pokhara Valley. The market coverage is viable which can include many
more regions of Kaski, Tanahau, Lamjung and Syangja districts.
8.2 Recommendation
We were able to perform successful feasibility analysis of Radio Begnas. The data which we
used in this analysis to perform different calculation are real case data that was reference from
valid sources. We did different financial calculation and projection and found the projected
revenue budget, income statement, balance sheet, cash flow statement. Similarly we found the
financial requirement and made the financial plan to carry out our feasibility analysis. Finally we
performed financial analysis and draw many conclusions from our result.
Business Development plan of Radio Begnas FM
We recommend to every other individual that the analysis performed in this project report is
completely truthful. We also assure people about the reliability of our work. So we recommend
establishing this project.
Business Development plan of Radio Begnas FM
References
� K. R. Bimal CHAPAGAIN (1996) Strategic Intervention towards the Improvement of Radio Nepal’s Development Performance. Master’s Thesis in the Asian Institute of Management. Manila, Philippines.
� The Eight Five Year Plan (1991) National Planning Commission. Kathmandu, Nepal.
� MISHRA, U. M. (1974) The Broadcasting Media Exposure and Modernization Force in Urban Slums, Media Area. Kathmandu, Nepal.
� Paudel, R.B., Baral K.J., Gautam, R.R., Rana S.(2006). Fundamentals of corporate
finance: financial planning and forecasting. Bhotahity, Kathmandu: Asmita publication.
� Porter, G.A., & Norton, C.L.(second edition ). Financial Accounting: financial statement analysis. Fort Worth, Philadelphia, San Diego, New Work, Orlando, Austin: The Dryden Press.
� Brigham & Ehrhardt (2005), Financial Management: Text and Cases, New Delhi, Cengage Learning India Private Ltd.
� Van Horne, J. C., & Wachowicz, J. M. (2009). Fundamentals of Financial Management. New Delhi.
� Pauley, S. E., & Riordan, D. G. (1996). Technical report writing today. Delhi. AITBS Publishers.
Business Development plan of Radio Begnas FM
Proposed Schedule
TIME SUN MON TUE WED THUS FRI SAT
Station open Station open
Station open Station open Station open Station open Station open Station open
Sajha Khabar Sajha Khabar Sajha Khabar Sajha Khabar Sajha Khabar Sajha Khabar Sajha Khabar
6.00 am CIN CIN CIN CIN CIN CIN CIN
6.30am National songs
National songs National songs National songs National songs
National songs National songs
7.00am Ushakiran Ushakiran Ushakiran Ushakiran Ushakiran Ushakiran Ushakiran
Manoj Sangita Manoj Sangita Manoj Sangita Manoj Sangita Manoj Sangita Manoj Sangita Manoj Sangita
8.00am Begnas khabar
Begnas khabar Begnas khabar Begnas khabar Begnas khabar
Begnas khabar Begnas khabar
Khabar team Khabar team Khabar team Khabar team Khabar team Khabar team Khabar team
9.00am Nepal Khabar Nepal Khabar Nepal Khabar Nepal Khabar Nepal Khabar Nepal Khabar Nepal Khabar
Ujyalo Ujyalo Ujyalo Ujyalo Ujyalo Ujyalo Ujyalo
9.15am Mixmas geetharu
Mixmas geetharu
Mixmas geetharu
Mixmas geetharu
Mixmas geetharu
Mixmas geetharu Begnas Quiz
Basanta
10.00am GB ka lokbhaka
GB ka lokbhaka GB ka lokbhaka GB ka lokbhaka GB ka lokbhaka
GB ka lokbhaka GB ka lokbhaka
Tulsing Tulsing Tulsing Tulsing Tulsing Tulsing Tulsing
11.00am Begnas Dayari
Begnas Dayari Begnas Dayari Begnas Dayari Begnas Dayari
Begnas Dayari Begnas Dayari
Khabar team Khabar team Khabar team Khabar team Khabar team Khabar team Khabar team
11.15am Hamro Cinema
Hamro Cinema Hamro Cinema Hamro Cinema Hamro Cinema
Hamro Cinema Hamro Cinema
Badri Badri Badri Badri Badri Badri Badri
12.00pm Nepal Khabar Nepal Khabar Nepal Khabar Nepal Khabar Nepal Khabar Nepal Khabar Nepal Khabar
Ujyalo Ujyalo Ujyalo Ujyalo Ujyalo Ujyalo Ujyalo
12.15pm Remix Songs Remix Songs Remix Songs Remix Songs Remix Songs Remix Songs Remix Songs
1.00pm Mixmas Mixmas Mixmas Mixmas Mixmas Mixmas S S manka kura
Equel Acess
2.00pm Begnas Dayari
Begnas Dayari Begnas Dayari Begnas Dayari Begnas Dayari
Begnas Dayari Begnas Dayari
Khabar Team Khabar Team Khabar Team Khabar Team Khabar Team Khabar Team Khabar Team
2.00pm Pop jhankar Pop jhankar Pop jhankar Pop jhankar Pop jhankar New Generation Pop jhankar
Sameer Sameer Sameer Sameer Sameer Punam Sameer
Business Development plan of Radio Begnas FM
3.00pm Nepal khabar Nepal Khabar Nepal Khabar Nepal Khabar Nepal Khabar Nepal Khabar Nepal Khabar
Ujyalo Ujyalo Ujyalo Ujyalo Ujyalo Ujyalo Ujyalo
3.15pm lok tatha dohori
lok tatha dohori lok tatha dohori lok tatha dohori lok tatha dohori
Hamro Rodhighar lok tatha dohori
Kisor
4.00pm Begnas Khabar
Begnas Khabar Begnas Khabar Begnas Khabar Begnas Khabar
Begnas Khabar Begnas Khabar
Khabar Team
Khabar Team Khabar Team Khabar Team Khabar Team
Khabar Team Khabar Team
4.15pm Sangit sangam
Sangit sangam Ustai Sangit sangam Sangit sangam
Sangit sangam Ustai
Bishnu Punam Mahindra Gangaram Gangaram Gangaram Mahindra
5.00pm Samjhanama Tapaiko Rojai Gufgaf Mero Bichar Mindcheck
Ma pani gauna Tapaiko Rojai
Gangaram Gangaram Gangaram Toplal Sameer Gd Mahindra
6.00pm Nepal khabar Nepal khabar Nepal khabar Nepal khabar Nepal khabar Nepal khabar Nepal khabar
Ujyalo Ujyalo Ujyalo Ujyalo Ujyalo Ujyalo Ujyalo
6.15pm Geet haru Geet haru Geet haru Geet haru Geet haru Geet haru Geet haru
7.00pm Begnas Khabar
Begnas Khabar Begnas Khabar Begnas Khabar Begnas Khabar
Begnas Khabar Begnas Khabar
Khabar Team Khabar Team Khabar Team Khabar Team Khabar Team Khabar Team Khabar Team
7.30pm Sajha Khabar Sajha Khabar Sajha Khabar Sajha Khabar Sajha Khabar Sajha Khabar Sajha Khabar
CIN CIN CIN CIN CIN CIN CIN
8.00pm Suskera Hamro Gaurab Suskera Jivan Paddati Suskera Kamka Kura Suskera
Thuldidi Toplal Thuldidi Toplal Thuldidi Manoj Thuldidi
8.45pm BBC BBC BBC BBC BBC BBC BBC
BBC BBC BBC BBC BBC BBC BBC
9.00pm Sajha Sawal Gajal Gunjan Mero katha Mero Yad Mero Yatra S S manka kura Mero Katha
BBC Bishal Dear kalyan Arjun Gd Equel access Dear Kalyan
10.00pm Bhariyaka Panaharu
Mero Bhawana AjaramarGitharu AjaramarGitharu AjaramarGitharu
Mero Bhawana AjaramarGitharu
Kisor Kisor Kisor
11.00pm Old Songs Old Songs Old Songs Old Songs Old Songs Old Songs Old Songs
12.00pm Stn Close Stn Close Stn Close Stn Close Stn Close Stn Close Stn Close
Business Development plan of Radio Begnas FM
A. Radio Transmission Systems
QTY DESCRIPTION
CLASS A (Rs.)
Transmitter size: 3.5 Kw
Antenna: 2 Bay
Tower and Line: 350'
1 Digital Capable Analog Transmitter with digital processing
analog exciter (Assumes High Level Combining)
42,000
(5 KW)
1 IBOC transmitter w/IBOC exciter for High Level Combined
System (Includes IBOC exciter and Exciter Auxiliary Switching
Unit)
69,000
1 IBOC Combiner for High Level (range is for 5 to 30KW) 7,000
1 Analog transmitter for Low Level Combining 59,000
1 IBOC(HD) exciter for Low Level Combining (includes Exciter
Auxiliary Switching Unit)
32,000
1 HD Radio Processor 9,000
1 IBOC licensing fees are required by manufacturer 5,000
1 Analog Transmitter ungradable to digital w/SCA and stereo
generators, spare tube, and spare parts kit
39,000
1 Circularly polarized antenna (no radomes or heaters) 3,700
1 lot Heliax transmission line and hangers 4,200
1 Transmission tower 60,000
1 Tower foundation cost 15,000
1 Tower installation (including mounting antenna and line) 25,000
1 FM Radio Processor 9,000
1 Dummy load 1,900
1 STL system (transmitter and receiver). Price includes two 6'
dishes and feedline of 200' with hot standby
42,000
1 STL tower (100' high with STL antenna, line and monitoring
receive antenna installed at studio site)
25,000
1 Transmitter remote control system 8,000
1 6' equipment rack with side panels 1,400
1 Frequency and modulation monitor system for stereo and SCA.
SCA required for telemetry monitoring.
10,000
1 Amplifier (audio) for off-air monitoring, including speakers
(system fed from monitoring equipment)
869
Business Development plan of Radio Begnas FM
1 EAS/CAP receiver and decoder/encoder 4,000
1 Transmission line dehydrator 1,500
1 Equipment shelter w/concrete pad 19,500
1 lot Transmitter AC power installation (assuming power at site
location)
8,000
1 lot Transmitter ventilation 3,500
1 lot Transmitter installation cost including miscellaneous materials 8,000
B. Radio Test Equipment
QTY DESCRIPTION STUDIO
(Rs.)
XMTR
(Rs.)
1 Digital audio test set; includes laptop 65,500
1 Frequency counter 2,500 2,500
1 Oscilloscope 3,500 3,500
1 Multimeter 350 350
c. On-Air Control Room (Radio)
QTY DESCRIPTION PRICE
(Rs.)
1 Analog or digital audio console 26,000
1 Audio network router w/logic interface and input/output modules 55,000
2 Speakers 1,000
1 Monitor amplifier 500
1 Audio hard disc storage system, system cost 45,000
2 Microphones with booms 1,200
2 Broadcast quality CD players 2,000
2 Direct-drive turntables @ Rs.750 1,500
Business Development plan of Radio Begnas FM
2 Stereo turntable preamps @ Rs.395 790
2 Turntable arms @ Rs.120 240
2 Stereo cartridges for turntables @ Rs.50 100
1 Custom cabinet for audio console and turntables 6,000
4 6' equipment racks @ Rs.545, plus one set of side panels @ Rs.235 2,415
4 Jack panels/wired, with jack cords 4,800
2 Headphones @ Rs.150 300
6 Distribution amplifiers @ Rs.350 2,100
1 lot Miscellaneous wire, ground strap, and installation materials 5,000
1 lot Labor for installation of On-Air control room 10,000
D. Production Control Room and Associated Studio (Radio)
QTY DESCRIPTION PRICE
(Rs.)
1 Analog or digital audio console 36,000
1 Non-linear editing system 30,000
4 Speakers 2,000
2 Monitor amplifiers 1,000
2 Audio limiters @ Rs.600 1,200
6 Microphones with stands 2,000
2 Broadcast quality CD players 2,000
2 Direct-drive turntables @ Rs.750 1,500
2 Stereo turntable preamps @ Rs.395 790
2 Turntable arms @ Rs.120 240
2 Stereo cartridges for turntables @ Rs.50 100
1 Custom cabinet for audio console and turntables 6,000
Business Development plan of Radio Begnas FM
1 6' equipment rack with side panels 1,500
4 Jack panels w/cords 4,800
2 Headphones @ Rs.150 300
1 lot Miscellaneous wire, ground strap, and installation materials 5,000
1 lot Labor for installation of production control room 10,000
E News Control Room (Radio)
QTY DESCRIPTION PRICE
(Rs.)
1 Audio console with monitor amplifier 8,000
2 Speakers 500
1 lot Flash card recorder 600
4 Microphones 600
4 Microphone stands 140
2 Microphones for use with portables @ Rs.65 130
2 Headphones @ Rs.150 300
1 lot Laptop computer w/flash card reader 65000
Business Development plan of Radio Begnas FM
Production and sales estimate
Total working Hour/ Day 18
Total working Days 365
Total Working Hours
6,570
Over time avilable (hour) 0
Details of service
Particulars assumption unit Annual Capacity
advertising 25% of total time 1,643
program time sold 3 hr per day 1,095
sponsorship 1 hr per day 365
Total 2,738
remaining time allocated for musical songs, news , live telecast and official media
Revenue Budget
Particular 100%
capacity sales price Amount(100%)
advertising 1,643 4000
6,570,000.00
program time sold 1,095 10000
912,500.00
sponsorship 365 6000
182,500.00
miscellaneous
200,000.00
Total
7,865,000.00
Projected sales Revenue schedule-13
Capacity 50% 55% 60% 65% 70%
sales revenue 1 2 3 4 5
advertising 6,570,000 3,285,000 3,613,500 3,942,000 4,270,500 4,599,000
program time sold 912,500 456,250 501,875 547,500 593,125 638,750
sponsorship 182,500 91,250 100,375 109,500 118,625 127,750
miscellaneous 200,000 100,000 110,000 120,000 130,000 140,000
7,865,000 3,932,500 4,325,750 4,719,000 5,112,250 5,505,500
Business Development plan of Radio Begnas FM
Projected Income statement
Schedule-3
S.N. Particular schedule year 1 year 2 year 3 year 4 year 5 A Sales 13 3,932,500 4,325,750 4,719,000 5,112,250 5,505,500
B Variable Exp 14 66,000 75,900 87,285 100,378 115,434
C contribution margin (A-B) 3,866,500 4,249,850 4,631,715 5,011,872 5,390,066
Operating Expenses salary and benefit 11-A 2,301,000 2,301,000 2,301,000 2,301,000 2,301,000
Depreciation 10 362,854 273,640 206,730 156,548 118,911 Operating Expenses 11-B 735,000 735,000 735,000 735,000 735,000
-
D Total Operating Exp 3,398,854 3,309,640 3,242,730 3,192,548 3,154,911
E EBIT (C-D) 467,647 940,210 1,388,985 1,819,325 2,235,155
F Interest 11-C 107,921 90,317 69,681 45,490 17,131
G EBT(E-F) 359,725 849,892 1,319,304 1,773,835 2,218,024
H tax (25%) 89,931 212,473 329,826 443,459 554,506
EAT(G-H) 269,794 637,419 989,478 1,330,376 1,663,518
Projected balance sheet
Schedule-
4
S/N Year Of Operation Schedule 0 1 2 3 4 5
ASSET
A Current Assets 342,586
1,005,047
1,797,141
2,853,870
4,177,267
5,767,973
Cash 5 342,586
677,338
1,436,661
2,460,620
3,751,246
5,309,181
Current Asset ( except cash) 6 -
327,708
360,479
393,250
426,021
458,792
B Fixed Assets 10 1,457,414
1,094,561
820,920
614,190
457,643
338,732
Total Assets (A+B) 1,800,000
2,099,607
2,618,061
3,468,061
4,634,910
6,106,705
Business Development plan of Radio Begnas FM
CAPITAL & LIABILITIES
A Current Liabilities 5 -
132,000
132,825
133,774
134,865
136,120
B Short Term Loan 2 -
-
-
-
-
-
C Long Term Loan 2 720,000
617,813
498,023
357,596
192,977
-
D Share Capital 2 1,080,000
1,080,000
1,080,000
1,080,000
1,080,000
1,080,000
E Reserves & Surplus 3 -
269,794
907,213
1,896,691
3,227,067
4,890,586
Total Capital & Liabilities(A+B+C+D+E)
1,800,000
2,099,607
2,618,061
3,468,061
4,634,910
6,106,705
Projected Cash flow statement
SN Year Of Operation schedule 1 2 3 4 5
A Sources of Fund
1 Opening Cash Balance 1 342,586
677,338
1,436,661
2,460,620
3,751,246
2 Cash from operational activities 2 830,500
1,213,850
1,595,715
1,975,872
2,354,066
EBIT 3 467,647
940,210
1,388,985
1,819,325
2,235,155
Add : depreciation 10 362,854
273,640
206,730
156,548
118,911
3 Cash from financing activities -
-
-
-
-
Equity -
-
-
-
-
Short Term Loan -
-
-
-
-
Long Term Loan
a Total Cash Available (1+2+3) - 1,173,086
1,891,188
3,032,376
4,436,493
6,105,312
Business Development plan of Radio Begnas FM
B Usage of Fund
Increase (Decrease ) in Working Capital
6 195,708
31,946
31,822
31,680
31,516
Purchase of Fixed Assets 10 -
-
-
-
-
Payment of Principal of Term Loan 12 102,187
119,791
140,427
164,618
192,977
Payment of interest of Short Term Loan
11-c -
-
-
-
-
Payment of Interest of Term Loan 11-c 107,921
90,317
69,681
45,490
17,131
Payment of principle of Short Term Loan
-
-
-
-
-
Payment of dividend -
-
-
-
-
Payment of Tax 89,931
212,473
329,826
443,459
554,506
b Total Cash Usage (b) 495,748
454,527
571,756
685,247
796,130
net cash flow (a-b-1) 334,752
759,323
1,023,959
1,290,626
1,557,935
Cash Balance (a - b) 677,338
1,436,661
2,460,620
3,751,246
5,309,181
particular
years
1 2 3 4 5
Opening Cash Balance 342,586.00
677,338.35
1,436,661.40
2,460,620.34
3,751,246.04
Total cash received in year 830,500.00
1,213,850.00
1,595,715.00
1,975,872.25
2,354,065.59
total cash usage in year 495,747.65
454,526.95
571,756.06
685,246.55
796,130.19
netcash flow during the year
334,752.35
759,323.05
1,023,958.94
1,290,625.70
1,557,935.40
Closing cash balance 677,338.35
1,436,661.40
2,460,620.34
3,751,246.04
5,309,181.44
Business Development plan of Radio Begnas FM
Advertisement Tariff
Spot Length 5am to 10am 10am to 5pm 5pm to 11pm
15sec Rs 50 Rs40 Rs 50
20sec Rs 60 Rs 50 Rs 55
25 sec Rs 65 Rs 55 Rs 60
30 sec Rs 70 Rs 60 Rs 65
40 sec Rs 75 Rs 65 Rs 70
45 sec Rs 80 Rs 70 Rs 75
50sec Rs 85 Rs 75 Rs 80
60 sec Rs 90 Rs 80 Rs 85
before news surplus charge
50 % 50% 50%
In between News
surplus charge
100% 100% 100%
Minimum Sponsorship Programme Cost
Size 6am to 10am 10am to 5pm 5pm to 11pm
One Hour Rs 8000 Rs 7000 Rs 7500
Half an hour Rs 7000 Rs 6000 Rs 6500
Special time 14 minutes Rs 3000 Rs 2500 Rs 2800
Special time 25 minutes Rs 4000 Rs 3000 Rs 3500
Special time 60 minutes Rs 8000 Rs 7000 Rs 7500
Business Development plan of Radio Begnas FM
Fixed Capital Requirement
Plant & Machinery
1,252,414.00
Radio transmission system
1 515,569 515,569.00
Radio Test Equipment
1 78,200 78,200.00
On-Air Control Room (Radio)
1 163,945
163,945.00
Production Control Room and
1 104430
104,430.00
Associated Studio (Radio)
1 65,000.00
65,000.00
News Control Room (Radio
1 75,270.00
75,270.00
program software
1 250,000.00
250,000.00
Office Equiptment & Furniture 100,000.00
furnitures like chair, table etc 1
100,000
100,000.00
-
Installation 75,000.00
instalation of office equipment 1
75000 75,000.00
Pre operating Expenses 30,000.00
registration,legal and feasibility study
1
30,000
30,000.00
1,457,414.00
Working Capital 342,586.00
TOTAL INVESTMENT 1,800,000.00
Business Development plan of Radio Begnas FM
Depreciation sheet
1
2
3
4
5
Schedule-10
S.N. Particulars DEP. opening
bal dep bal at end dep
bal at end dep
bal at end dep
bal at end dep bal at end
1 building and shed 5% -
-
-
-
-
-
-
-
-
-
-
2 plant and machinery 25%
1,252,414
313,104
939,311
234,828
704,483
176,121
528,362
132,091
396,272
99,068
297,204
4 office equipment and furniture 25%
100,000
25,000
75,000
18,750
56,250
14,063
42,188
10,547
31,641
7,910
23,730
6 installation 25%
75,000
18,750
56,250
14,063
42,188
10,547
31,641
7,910
23,730
5,933
17,798
7 pre-operating exp
30,000
6,000
24,000
6,000
18,000
6,000
12,000
6,000
6,000 6,000 -
total
1,457,414
362,854
1,094,561
273,640
820,920
206,730
614,190
156,548
457,643
118,911
338,732
schedule-6
Year Of Operation Days 1 2 3 4 5
A CURRENT ASSETS
Receivables 30 327,708
360,479 393,250
426,021
458,792
Inventories
Current Assets ( Except Cash)(a)
327,708
360,479 393,250
426,021
458,792
B CURRENT LIABILITIES
payable 30 5,500
6,325 7,274
8,365
9,620
office overhead 30 126,500
126,500 126,500
126,500
126,500
Total Current Liabilities (b)
132,000
132,825 133,774
134,865
136,120
Net Current Assets / Working Capital Requirements ( a-b)
195,708
227,654 259,476
291,156
322,672
change in working capital 195,708 31,946
31,822 31,680 31,516
Business Development plan of Radio Begnas FM
Capital structure
Particulars Total
Ratio Amount Rs.
Owner's Capital
60% 1,080,000.00
Long Term Loan
40% 720,000.00
Short term Loan 0% -
Total
100%
1,800,000.00
Usage of Fund
Particulars Total
Ratio Amount Rs.
Current Assets
20% 342,586.00
Fixed Assets
81% 1,457,414.00
Total
101%
1,800,000.00
DETAILS OF LONG TERM LOAN & LOAN REPAYMENT SCHEDULE
Schedule - 12
A) DETAILS OF LONG TERM LOAN
Loan amount
: Rs. 720,000
Interest Rate per annum : 16%
Periodic interest Rate ( quaterly ) : 1.33%
Instalment in a year
12
No. of installments : 60
Loan Period : 5 Years
Instalment Amount : $17,509.00 /
instalment
Principal Payment : Monthly Interest Payment : Monthly Total Interest Payment : Rs. 330,540
Total Principal Payment : Rs. 720,000
Total Interest & Principal
: Rs. 1,050,540
Business Development plan of Radio Begnas FM
B) LOAN REPAYMENT SCHEDULE :
MONTHLY PAYMENT ANNUAL PAYMENT
Year No. of Instalm
ent
Instalment Amount Rs.
Interest Payment
Rs.
Principal Amount Rs.
Outstanding Principal
Rs.
Annual Instalment
Annual Interest Rs.
Annual Principal
Rs.
Remaining Principal Rs.
1
1 17,509 9,600 7,909 712,091
2 17,509 9,495 8,014 704,077
3 17,509 9,388 8,121 695,955
4 17,509 9,279 8,230 687,726
5 17,509 9,170 8,339 679,386
6 17,509 9,058 8,451 670,936
7 17,509 8,946 8,563 662,373
8 17,509 8,832 8,677 653,695
9 17,509 8,716 8,793 644,902
10 17,509 8,599 8,910 635,992
11 17,509 8,480 9,029 626,963
12 17,509 8,360 9,149 617,813 210,108 107,921 102,187 617,813
2
13 17,509 8,238 9,271 608,542
14 17,509 8,114 9,395 599,147
15 17,509 7,989 9,520 589,626
16 17,509 7,862 9,647 579,979
17 17,509 7,733 9,776 570,203
18 17,509 7,603 9,906 560,297
19 17,509 7,471 10,038 550,258
20 17,509 7,337 10,172 540,086
21 17,509 7,201 10,308 529,778
22 17,509 7,064 10,445 519,333
23 17,509 6,924 10,585 508,748
24 17,509 6,783 10,726 498,023 210,108 90,317 119,791 498,023
MONTHLY PAYMENT ANNUAL PAYMENT
Year No. of Instalm
ent
Instalment Amount Rs.
Interest Payment
Rs.
Principal Amount Rs.
Outstanding Principal
Rs.
Annual Instalment
Annual Interest Rs.
Annual Principal
Rs.
Remaining Principal Rs.
3
25 17,509 6,640 10,869 487,154
26 17,509 6,495 11,014 476,140
27 17,509 6,349 11,160 464,980
Business Development plan of Radio Begnas FM
28 17,509 6,200 11,309 453,671
29 17,509 6,049 11,460 442,211
30 17,509 5,896 11,613 430,598
31 17,509 5,741 11,768 418,830
32 17,509 5,584 11,925 406,905
33 17,509 5,425 12,084 394,822
34 17,509 5,264 12,245 382,577
35 17,509 5,101 12,408 370,169
36 17,509 4,936 12,573 357,596 210,108 69,681 140,427 357,596
4
37 17,509 4,768 12,741 344,855
38 17,509 4,598 12,911 331,944
39 17,509 4,426 13,083 318,861
40 17,509 4,251 13,258 305,603
41 17,509 4,075 13,434 292,169
42 17,509 3,896 13,613 278,555
43 17,509 3,714 13,795 264,761
44 17,509 3,530 13,979 250,782
45 17,509 3,344 14,165 236,616
46 17,509 3,155 14,354 222,262
47 17,509 2,963 14,546 207,717
48 17,509 2,770 14,739 192,977 210,108 45,490 164,618 192,977
5
49 17,509 2,573 14,936 178,041
50 17,509 2,374 15,135 162,906
51 17,509 2,172 15,337 147,569
52 17,509 1,968 15,541 132,028
53 17,509 1,760 15,749 116,279
54 17,509 1,550 15,959 100,321
55 17,509 1,338 16,171 84,149
56 17,509 1,122 16,387 67,762
57 17,509 903 16,606 51,157
58 17,509 682 16,827 34,330
59 17,509 458 17,051 17,279
60 17,509 230 17,279 0 210,108 17,131 192,977 0
Total
1,050,540 330,540 720,000
1,050,540 330,540 720,000
Business Development plan of Radio Begnas FM
Important financial ratios
SN Year Of Operation Av
erage 1 2 3 4 5
1 Net Profit Margin (EAT / Sales) % 19.76% 6.86% 14.74% 20.97% 26.02% 30.22%
2 Total Assets Turnover ( Times )
1.38 1.87 1.65 1.36 1.10 0.90
3 Fixed Assets Turnover (Times )
8.79
3.59
5.27
7.68
11.17
16.25
4 Current Assets/ Fixed Assets (Times )
6.78
0.92
2.19
4.65
9.13
17.03
5 Current Liabilities / Total Capital (Times )
0.04
0.06
0.05
0.04
0.03
0.02
6 Return On Investment (%) 54.34% 14.99% 35.41% 54.97% 73.91% 92.42%
7 Return On Equity (%) 28.81% 19.99% 32.08% 33.24% 30.89% 27.86%
8 Return on Assets (%) 31.48% 14.99% 30.36% 37.79% 38.36% 35.89%
9 Current Ratio ( Times)
23.17
7.6
13.5
21.3
31.0
42.4
10 Interest Coverage Ratio (Times )
41.03
4.3
10.4
19.9
40.0
130.5
11 Interest / Sales (%) 1.50% 2.74% 2.09% 1.48% 0.89% 0.31%
12 EBIT/ Sales (%) 27.85% 11.89% 21.74% 29.43% 35.59% 40.60%
13 Total Expenses / Sales ( %) 74% 91% 80% 72% 65% 60%
Break even analysis
Year Of
Operation Average 1 2 3 4 5
1 Total Sales
4,719,000
3,932,500
4,325,750
4,719,000
5,112,250
5,505,500
2 Total Variable
Cost
88,999
66,000
75,900
87,285
100,378
115,434
3 Total Fixed Cost
3,325,844
3,506,775
3,399,958
3,312,411
3,238,037
3,172,041
4 Profit Volume
Ratio 98% 98% 98% 98% 98% 98%
5 Break Even Sales
3,389,002
3,566,634
3,460,679
3,374,834
3,302,889
3,239,974
Business Development plan of Radio Begnas FM
6 Break Even Sales
% 73.13% 91% 80% 72% 65% 59%
7 Cash BEP 66.48% 78.52% 71.44% 65.55% 60.58% 56.33%
8 Safety Margin Rs.
1,329,998
365,866
865,071
1,344,166
1,809,361
2,265,526
9 Safety Margin (%) 26.87% 9.30% 20.00% 28.48% 35.39% 41.15%
PAY BACK PERIOD
NON DISCOUNTED PAY BACK PERIOD
Year CFAT Cummulative Rs. Cash Flow Rs.
0
(1,800,000)
(1,800,000)
1 544,860 (1,255,139.64)
2 969,431 (285,708.57)
3 1,234,067 948,358.38
4 1,500,734 2,449,092.09
5 1,768,043 4,217,135.50
Payback period 2.23 years
DISCOUNTED PAY BACK PERIOD Year CFAT Discount Factor @ Discounted Cashflow Cumulative
16.00% Cash Flow Cashflow
0
(1,800,000) 1
(1,800,000)
(1,800,000)
1 544,860 0.8621 469,707 (1,330,293)
2 969,431 0.7432 720,445 (609,848)
3 1,234,067 0.6407 790,614 180,767
4 1,500,734 0.5523 828,842 1,009,609
5 1,768,043 0.4761 841,788 1,851,397
1,851,397
Discounted PB Period 2.78 yrs
Business Development plan of Radio Begnas FM
NET PRESENT VALUE
Year Cash Flow Discount Factor @ Discounted Cashflow
After Tax 16% Cash Flow
0
(1,800,000) 1.000
(1,800,000)
1 544,860 0.8621 469,707
2 969,431 0.7432 720,445
3 1,234,067 0.6407 790,614
4 1,500,734 0.5523 828,842
5 1,768,043 0.4761 841,788
NET PRESENT VALUE 1,851,397.22
TOTAL PRESENT VALUE 3,651,397.22
INTERNAL RATE OF RETURN 46.61%
Year CFAT Discount Factor @ Discounted Cash flow
46.61% Cash Flow
0
(1,800,000) 1.000
(1,800,000.00)
1 544,860 0.6821 371,631.69
2 969,431 0.4652 450,995.27
3 1,234,067 0.3173 391,580.72
4 1,500,734 0.2164 324,798.30
5 1,768,043 0.1476 260,994.02
Net Present Value
0.00
PROFITABILITY RATIO
Total Present Value (TPV) = 3,651,397
Investment (I) = 1,800,000
Benefit Cost Ratio = TPV / I = 2.0 times
Business Development plan of Radio Begnas FM
Summary of capital Budgeting
Total Project Investment Total Project Investment Total Project Investment Total Project Investment 1,800,000.00 1,800,000.00 1,800,000.00 1,800,000.00
Total Present Value Total Present Value Total Present Value Total Present Value 3,651,397.22 3,651,397.22 3,651,397.22 3,651,397.22
Net Present Value Net Present Value Net Present Value Net Present Value 1,851,397.22 1,851,397.22 1,851,397.22 1,851,397.22
Internal Rate of ReturnInternal Rate of ReturnInternal Rate of ReturnInternal Rate of Return 47%47%47%47%
Pay Back Period (Years)Pay Back Period (Years)Pay Back Period (Years)Pay Back Period (Years) 2.23 2.23 2.23 2.23
PBPBPBPB Period(Discounted) YearsPeriod(Discounted) YearsPeriod(Discounted) YearsPeriod(Discounted) Years 2.78 2.78 2.78 2.78
Benefit Cost Ratio (PCR):Benefit Cost Ratio (PCR):Benefit Cost Ratio (PCR):Benefit Cost Ratio (PCR): 2.03 2.03 2.03 2.03
BEP Sales ( %)BEP Sales ( %)BEP Sales ( %)BEP Sales ( %) 73%73%73%73%
For more: contact me;
[email protected], [email protected]
Cell phone : 9779847114473