Investment Project for Creating Workshop for Bottling Drinking Water

Creation of a modern highly profitable automated factory specialized in bottling of ecological clean drinking water in order to create a new regional brand.

Shareholders' equity: 7800000 RUB
Lenders ability: 18254000 RUB
NPV: 7615167 RUB
IRR: 32.3%
Payback: 3.33 years

Creation of a modern highly profitable automated factory specialized in bottling of ecological clean drinking water in order to create a new regional brand and effective promotion of products in the region.

The plan is to set up a factory, which will contain:
- Modern line of water treatment
- 2 Blowing machine of PET bottles with unique design, performance, 400-880 bottles/per hour
- Semi-automatic line for bottling in containers of 0,5 - 1,5 liter capacity of 3000 L / hr
- Semi-automatic bottling line in a container of 5 liters capacity of 1000 L / hr
- Packaging, labeling and any other necessary facilities.

The time lines for the project realization are:
1) The preparatory phase (developing of a business plan, obtaining technical specifications for connection, preparation and coordination of the project, negotiations with banks, etc.) -185 days, 1/8/1910
2) Investment stage: Construction;February-March 2011, purchasing and installation of the equipment March-April 2011 as well
3) Launching of the product line;April-May 2011

Annual revenues from the project:
For 2011-33 364 000RUB
For 2012 and beyond - 45875 000RUB

The necessary minimum requirements by project owner are:
1. Presence of an existing business, registered more than 1 year ago and showing positive results
2. Presence of own funds amounting to 7,800,000 Rubles a contribution to the authorized capital of LLC ( funds will be used for a 30% stake in the financing of capital costs of the project)
3. Presence of sufficient collateral (about 41500000RUB market value) or the ability to attract third-party organization which becomes a guarantor and credibility for the project to the bank (possibly partial involvement of the regional mortgage Fund)

4. Presence of an additional opportunity to raise funds (in the form of a loan or bank loan) in the amount of 7200 000RUB for short-term working capital financing is desirable.

The total demand for financing of the project:
33 254 000 RUB with VAT; Capital expenditures at 26 054 000 RUB.

Capital expenditures:
The preparatory phase of - 1,416,000RUB
Construction of internal communications networks - 1,165,000RUB
Construction and installation work - 10,772,000RUB
Acquisition of capital equipment - 9,750,000RUB
Acquisition of vehicles - 2,720 000RUB
Furniture and office equipment - 231,000RUB
TOTAL Amount - 26,054,000RUB

Variable costs per unit of finished product – for the average bottle - (including the cost of cover, preforms, labels, pens, carbon dioxide and technological power) will be about 4.52 rubles.
Overhead costs (including general business, administrative, product promotion costs, depreciation and interest costs on borrowed loans) about 3.49 rubles. 1 bottle of the weighted average.
Returns on sales of pre-tax profit - 29,2% (income - 3.31 rubles each weighted bottle)

Break-even point:
2,255,355 bottles or 5 mln.240 thousand liters or
25,536,489 rubles.
Break-even sales ratio to the annual volume of production - 51,4%
Planning horizon (period of): 4 years and 3 months (from August 2010 to October 2014)

Investors can contact us on Merar.