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AS Finance Solutions Pvt. Ltd.

DISCLAIMER: This Project Report is a sample of a real dairy farm project. Excerpts have been

taken from the original project report. Figures are close to actual, however, they should be

adjusted and considered accordingly for understanding purpose. There might be issues with

regard to flow of information and presentation. Readers discretion is sought here as this report

had to be edited from a real project report. This report does not claim to be the only way to a

project to be conducted and neither intends to disclose any confidential information. This is only

for educational purpose of the readers and for spreading knowledge.

Cost & Means

of Finance

Cost of Project:

(Rs. in Lacs)

S.

No. Particulars Total

1. Building Construction 251.58

2. Machinery & Equipment 134.11

3. Utilities 43.12

4. Purchase of Cow 196.88

Hard Cost 625.68

5. Interest During Construction 30.14

6. Margin for Working Capital 15.00

7. Preliminary Expenses 9.17

Soft Cost 54.31

Total Project Cost 680.00

Means of Finance:

(Rs. in Lacs)

S.

No. Particulars Total

1. Promoter's Contribution 225.00

2. Bank Term Loan 455.00


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Total 680.00

Funding

Requirement

• Term Loan Facility of Rs.455 Lakhs

• Working Capital Limit of Rs.20 Lakhs

Security Primary:

• Charge on entire fixed assets of the company, present as well as

future.

• Charge by way of hypothecation on all the movable assets

including, but not limited to plant & machinery, machinery

spares of the Borrower.

Collateral:

Equitable mortgage of properties in the name of promoters

Personal Guarantee of promoters

Door-to-

Door Tenor

• Door to Door tenor of 7 years (April, 20xx to Mar, 20xx).

• Moratorium period of 6 months i.e. from October, 20xx to Mar, 20xx.

• The repayment will commence from April, 20xx and entire loan will

be repaid in 72 monthly installments.

Rate of

Interest Rate of Interest: 13.25% (considered only for this report working)

Profile of CONSULTANT :

Consultant was founded more than 125 years ago in Sweden and today Consultant

operates in more than 150 markets.




Consultant is a global company and a market leading supplier of solutions that improve

the performance of farms for professional food producers. They support their customers

in reducing their environmental footprint while improving food production, profitability

and the well-being of the people and animals involved. They offer products, systems and

services for all steps of milk production. Their solutions are used by millions of dairy

farmers around the globe every day.

At Consultant they continue to work on the farmers’ behalf, striving to make a

difference, by finding new ways and solutions to drive progress in milk production. They

aim to improve milk quality, food production, animal welfare and the environment of

both animal and milker.

Consultant is a full-service supplier to dairy farmers. Consultant develops, manufactures

and distributes equipment and complete systems for milk production and animal

husbandry. Service, sales of a wide range of accessories, knowledge sharing and on-site

consultation are also key aspects of their operations.

Consultant have got more than 20 factories all-round the world with expansion of

factories in process further and central warehousing centre in Germany .

Consultant has got presence in most parts in the country and has branch /service

presence in more than 20 cities.

Consultant is having Head office in Pune and Regional offices for North, West, Central,

East and South regions.

Consultant has got enlarged support /channel partners with more than 23 dealers in the

country.

Consultant Support

Role and Activities for project support from Consultant:




Consultant is capable to offer services for planning and support for the setting XYZ dairy

farm Project. The benefits for doing the dairy farming are clearly seen and visible which are

backed by the experience of Consultant in this sector and help them achieve their objectives

being:

• Technology for Securing Quality.

• Complete automation and hence better control and less labour.

• Automated feeding practices and hence better yield.

• Recovery of Manure for agriculture, organic food and Bio Gas.

• Better Animal health and hence better productivity.

• Higher herd size with better efficiency.

• Better environment as less wastage.

• Better financials as maximum efficiency could be achieved.

The scope of work and support to be provided from Consultant is briefed below:

• Feasibility study support.

• Total Milking, Feeding, Manure solutions for establishing and running a dairy

farm for cows.

• Project and planning material support with designs for complete farm.

• Consultancy – knowledge sharing.

• Professional channels for purchase of livestock & semen.

• Farm Expert arrangement for running the dairy farm.

• Equipment supply and Installation of the equipment.

• Training and after sales Services and maintenance.

• Fodder Production Recommendations and Areas for Feed Planning.




DAIRY FARMING

� Dairy Farming

Dairy farming is a class of Agriculture, or an Animal husbandry enterprise, for long-term

production of milk, usually from dairy cows but also from goats, sheeps and camels, which may

be either processed on-site or transported to a Dairy factory for processing and eventual retail

sale.

� World Dairy Sector

Dairy is a very sensitive industry in many countries (both developed and developing) and is

therefore protected by various trade policies. Milk is also a bulky and perishable commodity. As

a result only 7% of world milk production is traded internationally. In recent years the demand

for dairy products has remained stagnant in developed nations. Consequently, dairy companies

operating in the big and mature markets such as Europe and USA face limited market growth

opportunities in terms of volumes per capita and growth can only occur by increasing market

shares or switching to higher value-added products. In contrast the demand for dairy products

has been quite robust in the developing countries and multi-national dairy companies are




increasingly looking towards these markets for ensuring growth in sales and revenue.

However, entry into these markets could be quite difficult. One such emerging market which

presents both an interesting challenge and opportunity for dairy companies is India.

� Indian Dairy Sector

India is the largest milk producer in the world with an annual production in excess of 110

million tonnes in 2009 (International Dairy Federation 2009). The Indian dairy markets value

was estimated to be about 42.5 Billion US$ in 2007 (Dairy India 2007). The dairy industry in

India is integrally linked to the overall economic well being of the country because it serves as a

vital source of employment and provides livelihood opportunities to millions of small farmers

in rural India.

Although India is the world’s largest consumer of dairy products, consuming nearly 100% of its

production, per-capita milk consumption (91 kg/year) in India is lower than the world average

(103 kg/year) (IFCN 2010). With rapid economic development and increases in family incomes,

it is expected that per capita milk consumption will increase considerably in India. It’s

estimated that India’s demand for dairy products will reach around 200 million tonnes by 2022

(NDDB 2011). Since dairy imports into India are strongly regulated using tariffs, tariff rate

quotas, and non-tariff barriers much of India’s demand has to be met by the domestic dairy

industry. However, based on past trends, India’s domestic industry will only be able to supply

160 million tonnes – resulting in a shortfall of 40 million tonnes (NDDB 2011). This growing

demand for dairy products and likely supply-demand gap presents an excellent opportunity for

multinational dairy companies to venture into the Indian dairy market.




� Feeding Management

Managing feed cost effectively is the key to profitable dairying.

� The following diagram depicts overview of movement in dairy sector:




� Dairy Farm Planning




The scope is divided in the stages as mentioned below:

A. Farm Planning-

Keeping the animal numbers and breeds in view Consultant will provide Planning Drawings

and layout designs for the entire farm at the recommended site including the following key

items:

Feeds & Feeding

• Cattle Housing & Herd Management for Cows and Allied herd

• Manure Management

• Milking & Milk Handling buildings

• Production Services – Maternity and Treatment, Laboratory

• Health Care

• Water Planning/Arrangement

• Construction Recommendations except Civil /Structural drawings for construction

• Planning of Administrative Block, Staff Quarters and Guest House etc.

A. Equipment Planning-




Consultant provides their recommendation for the necessary equipment in the following

areas:

• Feeds and Feeding

• Housing and Herd Management

• Manure Management and handling

• Milking Parlor & Milk Handling

• Cooling systems

B. Farm Management-

Consultant can suggest references of possible candidates for the position of Dairy/farm

Manager and other functions and can also help in training the manpower and helping in

selecting the right candidates.

C. After Market Support-

Consultant will provide annual maintenance contact so as to provide after sale- support at

special rates. This will help in smooth functioning of the system and dairy farming operations.

D. Project Execution Team-

Consultant helps in planning and ensures the correct implementation of the project and

provides necessary trainings and support during the Installation phase of the machinery.

PROJECT

Project Highlights

Name of the concern ABC Milk Products Pvt. Ltd.

No. of Cows 250




Land/plot size 12480 Square Meters

Location DEF, XYZ

Project cost Rs. 680 Lakhs

Annual Production 1200000 litres (approx.) in 1st year of operations

Project Objectives

• The goal of this project is to establish an intensified high yield cow dairy farm, based

on the company’s current material base of livestock, practice and experience;

expansion of its operations, processing of milk yielded in its established medium-size

modern dairy facility.

• To become a supplier of high yield and quality of milk across the country by using

world class technologies to extract the maximum milk without wastage through

pilferage or bacterial infection.

• To promote standards (qualitatively and otherwise) and to foster the growth of dairy

industry in general and for the purpose engages in consultancy activities.

• To promote dairying as a part of Animal Husbandry activity in particular and

agricultural farming in general for the benefit of livestock and agricultural farmers.

• To provide the consumers, a high quality and unadulterated milk which is a common

household demand and to meet the ever rising requirement.

Know- How

• The company has proposed to develop the dairy farm for which it is bringing in 250

HF cows.




• The extraction will be done in 2 shifts per day with approximately 7 hours of full

extraction process per day which will be executed in about three and half hours per

shift. Extraction will be done in the morning and evening phase of the day.

• The cow being used for milk extraction is expected to produce daily 16 liters of milk

per cow. Since, special care is being undertaken of the cows and overall management

of the farm, the cows are expected to increase the quantity of milk in lactation for

about 3-4 years from where it is considered to remain stagnant at those levels.

• The extracted milk will be directly transferred to a cold storage tanker which will

preserve the milk from getting infected due bacterial attack by keeping it at 4 Degree

Celsius temperature.

• The state of the art technology is being installed for extraction of milk, herd

management, movement and storage of milk at appropriate temperatures. This

technology and consultancy is being arranged from a well known Swedish company,

named Consultant, who are into installing Dairy Farms since decades.

• Cattle will be kept under proper sheds facility maintained at the farm including

arrangements for proper vaccination.

• The milk extracted and sold will be pure raw milk and will not include any

classifications as 1.5% fat, or 3% or 4% fat milk.

• Milk will be sold to co-operatives directly from farm which will then ultimately sell it

to the end consumer after processing.

• It is expected that a HF cow’s lactation period is 300 days (approx.) out of the total

365 days. Remaining being the dry days.

• Considering the milking capacity of the cow, there would be around 4000 Liters of

milk extraction, which will be increased in consequent years with proper

maintenance of cows. Including feeding of cows which include concentrate also.

• Adequate number of staff are being employed which include milkers, veterinary, farm

labour, supervisors and Dairy Manager.




Financial Aspects

• The Indian Dairy Farming Industry has always been dominated by unorganized

sector as this being an earning source for lacs of household owning few cows. Of late,

the organized sector has now realized the huge potential which is still lying untapped.

Here, at ABC Dairy Farms, a sincere effort has been made to tap the potential

convincingly by proper farm management and financial management to make it a

profitable enterprise. The financials based on which the ABC Milk Products Pvt. Ltd. is

proposing to reach XYZ to it aim of success are discussed hereunder:

� The very nature of the dairy industry makes it a profitable business being the

demand being huge and remaining unsatisfied with respect to the sXYZply of

milk. Hence, profit margin being 42% i.e. PBDIT (Profit before Depreciation

Interest and Tax) to Sales Ratio being at this levels gives a realistic picture of the

dairy sector. A high profitability is ensured through proper farm management

including extensive care of cows so that their lactations are smooth and

rewarding in terms of quantity.

� Return on Capital Employed being increasing from 21% to 24% in first two

years of operations makes it a viable option for investing capital.

� Debt Equity Ratio in current year is 1.71. This makes it a completely controlled

debt equity proportion which is very healthy for the business and financial health

maintenance of the company.

� Total Outside Liabilities/ Tangible Net worth (TOL/TNW) is, at present,

maintained at 1.99 times in first year of operations and since then it is on a

declining trend owing to a consistent increment in TNW which is backed by

incremental operational gains.

� Interest Service Coverage Ratio (ISCR) is being maintained at very healthy

levels. ISCR is 2.98 times in first year of operations owing to high interest in the

first year. The same has been maintained at higher levels since second year of




operations and consistently increasing since then providing a favourable scenario

for interest repayment.

� Debt Service Coverage Ratio (DSCR) - Average DSCR is at 2.00 times which is a

positive aspect of the financials which is depicting higher sufficiency in debt

repayment being sXYZported higher efficiency of operations leading to

appropriate availability of funds for debt servicing.

� Internal Rate of Return (IRR) – At current financial position IRR is 41.33%. This

depicts the project is viable and providing sufficient inflows for sustainability of

the project.

� Sensitivity Analysis of the project has been determined under three scenarios

which are enumerated as hereunder:

%

Change Scenario IRR DSCR

Base Case 41.33% 2.00

-5% Change in Selling Price 35.12% 1.80

+5% Change in Fodder Cost 40.04% 1.99

+1% Change in Interest Rate 41.26% 1.96

A comparison of different scenarios with Base Case Scenario has been done which is the

present financial condition.

In Base Case scenario, IRR and DSCR are at healthy levels.

On considering a decrease in selling price by 5%, IRR and DSCR comes at 35.12% and 1.80

respectively which is a sufficient level for project sustenance.




In another scenario, where Fodder Cost has been increased by 5%, IRR comes at 40.04%

and DSCR at 1.99 which again is a favourable position.

In the third scenario, change in interest rate has been considered, which is taken as 1%

increase in interest rate. The IRR and DSCR in this scenario is 41.26% and 1.96 respectively

which is a healthy position.

Considering the above Sensitivity Analysis it can be easily deduced that under different

stress conditions, the financial stability of the borrower is intact.

� Feeding Cost – Maintenance of cows require feeding and other management expenses.

Hence, feeding forms the majority of expenditure being an important cost element. The

same comes to about 45% of the turnover consistently considering the pricing of fodder

and concentrate.

� Sales are showing a reasonable and feasible trend of growth owing to lactation quantity of

cow being increased since second year operations because of efficient farm management,

herd management, cow maintenance, and appropriate space for cows and hygienic

conditions for cattle to dwell into.




Moving cows back to their Sheds

Direct transfer of extracted Milk to bulk cool Tanker for preservation

Extraction of Milk from Cows using Machines

Putting on Cluster with minimum Air Inlet

Cleaning with Water and Drying

Placing of cows in separate sections

Movement of Cows from Shed to Milking Area


PROCESS FLOW

Moving cows back to their Sheds



Putting on Cluster with minimum Air Inlet

Cleaning with Water and Drying

Placing of cows in separate sections








Location

The company is planning to set XYZ the plant in the state of XYZ, at DEF city. The location of the

plant is K village, in DEF, XYZ.

Population:

As of the 2011 census, DEF municipality had a population of 392,451 and the urban

agglomeration had a population of 494,792. 12.2% of the population was under six years

old. Effective literacy was 80.99%; male literacy was 85.82% and female literacy was 75.65%.

Educational Infrastructure:

There are a number of good schools and colleges in the city. Schools are mostly associated

with CBSE and XYZ Board. The city has several institutions of higher education. It is home to a

major medical colleges and also privately funded colleges. The state-sponsored colleges like S.D

Degree College, S.D College of Management Studies, D.A.V Degree College etc.

Connectivity:

DEF is well connected by Road and Railway Networks. The line passes through the city thus

forming the backbone of the long-distance and best possible travel from the city. Indian Railways

provides connections to, Western, South India and other parts of the country and express trains

pass through and halt at the DEF station. The section of this railway route is now being developed

as a part of the Eastern Dedicated Freight Corridor. The corridor extends from Punjab to Dankuni

in West Bengal.

The National Highway - 58 (NH-58) passes through DEF city. This highway provides connections

towards Delhi on the southern direction and upper reaches of the Himalayas in the state on the

northern direction. The highway is the backbone of the road transportation for the DEF city as

well as Garhwal region of Uttarakhand. Cities and areas of Hardwar, Rishikesh, Dehradun as well

as Badrinath and Kedarnath are served by this highway.

Advantage:




• The company enjoyes advantage of dense clusters of population surrounding the farm

area which provides a scope for sales consistency.

• The high literacy levels of the area give a boost towards knowledge carrying for

understanding the nutritional benefits of quality milk.

• Easy accessibility and connectivity with major cities through major link XYZ networks

like Railway, Roadways provide a scope for wider coverage of areas for supply of milk.

Land

The plant for Dairy farming will be set XYZ in about 12480 square meters of area in the core

DEF city supplying milk to nearby areas, districts etc. The Company has already acquired the

Land measuring an area of 12480 Sq. meters situated at XYZ, India. The land area is sufficient

for the proposed project.

Buildings

The most widely prevalent practice in this country is to tie the cows with rope on a Katchafloor

except some organized dairy farms belonging to government, co-operatives or military where

proper housing facilities exist. It is quiet easy to understand that unless cattle are provide with

good housing facilities, the animals will move too far in or out of the standing space, defecating

all round and even causing trampling and wasting of feed by stepping into the mangers. The

animals will be exposed to extreme weather conditions all leading to bad health and lower

production. Dairy cattle may be successfully housed under a wide variety of conditions,

ranging from close confinement to little restrictions except at milking time.

However, two types of dairy barns are in general use at the present time.

• The loose housing barn in combination with some type of milking barn or parlor.

• The conventional dairy barn.

Loose Housing System:




Loose housing may be defined as a system where animals are kept loose except milking and

at the time of treatment. The system is most economical. Some features of loose housing

system are as follows.

• Cost of construction is significantly lower than conventional type.

• It is possible to make further expansion without change

• Facilitate easy detection of animal in heat.

• Animals feel free and therefore, proves more profitable with even minimum grazing

• Animals get optimum excise which is extremely important for better health

production.

• Over all better management can be rendered.

Cattle Shed:

The entire shed should be surrounded by a boundary wall of 5" height from three side and

manger etc., on one side. The feeding area should be provided with 2 to 2 ½ feet of manger

space per cow. All along the manger, there shall be 10" wide water trough to provide clean,

even, available drinking water. The water trough thus constructed will also minimize the

loss of fodders during feeding. Near the manger, under the roofed house 5' wide floor

should be paved with bricks having a little slope. Beyond that, there should be open

unpaved area (40'X35') surrounded by 5' wall with one gate. It is preferable that animals

face north when they are eating fodder under the shade. During cold wind in winter the

animals will automatically lie down to have the protection from the walls.

A dairy building should be located to a maximum exposure to the sun in the north and

minimum exposure to the sun in the south and protection from prevailing strong wind

currents whether hot or cold. Buildings should be placed so that direct sunlight can reach

the platforms, gutters and mangers in the cattle shed. As far as possible, the long axis of the

dairy barns should be set in the north-south direction to have the maximum benefit of the

sun.




Cattle yards should be so constructed and situated in relation to feed storages, hay stacks,

silo and manure pits as to effect the most efficient utilization of labour. Sufficient space per

cow and well arranged feeding mangers and resting are contribute not only to greater milk

yield of cows and make the work of the operator easier also minimizes feed expenses. The

relative position of the feed stores should be quite adjacent to the cattle barn. Noteworthy

features of feed stores are given:

• Feed storages should be located at hand near the center of the cow barn.

• Milk-house should be located almost at the center of the barn.

• Centre cross-alley should be well designed with reference to feed storage, the stall

area and the milk house.

Building construction of farm includes building of shed, milking area, quarters, milking storage

tank facility, feed gowdown shed etc. The company has entered into an agreement with Consultant

India to provide technical specifications for construction work which shall ultimately be carried

out by the company itself by hiring own contractors under the specifications provided by

Consultant.

COST OF BUILDING : (Rs. in Lakhs)

Sr.

No. Particulars Size Area

Approx.

Rate

Approx.

Rate

Approx.

Cost

L (m)

B

(m) Sq. M Rs/sqm Rs/sqft Rs.

1. Cost of Milking Cow Shed #1 57.2 28.25 1615.9 3336 310 53.90

2. Cost of Milking Cow Shed #2 39.4 28.25 1113.05 3336 310 37.13

3. Cost of Parlor Shed (Station+Offices+Sick) 22 11.2 246 9146 850 22.54

4. Cost of Viewing Gallery above Parlor offices 11.2 6 67 10222 950 6.87

5. Cost of Roads 460 5 2300 1022.2 95 23.51

6. Cost of Maternity & Calf Shed 22 11.2 246 3766 350 9.28

7. Cost of Young Stock Shed 43 13.5 581 3013 280 17.49

8. Cost of Hay Storage 20 12 240 3766 350 9.04




9. Cost of Concentrate Storage 10 12 120 3766 350 4.52

10. Cost of Silage Bunkers 26.6 12 319 2690 250 8.59

11. Cost of Manure Subpit Tank (6x6x4 conc) 6 6 36 26900 2500 9.68

12 Cost of Manure Tank Drain 120 0.6 1968 600 2.36

13. Cost of Water Storage & Supply 5.00

14. Cost of Internal Railings & Gates 564 1197 365 6.75

15. Cost of Security & Tire Wash 1.00

16. Cost of Entry Gate 1.00

17. Cost of Fencing (7 ft Brick + Barbed wire) 608 3444 1050 20.94

239.60

Add: Contingency @5% 11.98

TOTAL 251.58

Machinery & Equipments

Machine Milking:

Modern milking machines are capable of milking cows quickly and efficiently, without injuring

the udder, if they are properly installed, maintained in excellent operating conditions, and

used properly. The milking machine performs two basic functions.

• It opens the streak canal through the use of a partial vacuum, allowing the milk to

flow out of the teat cistern through a line to a receiving container.

• It massages the teat, which prevents congestion of blood and lymph in the teat.

Advantages

The advantages of this milking machine are manifold. It is easy to operate, costs low, saves

time as it milks 1.5 litre to 2 litres per minute. It is also very hygienic and energy - conserving

as electricity is not required. All the milk from the udder can be removed. The machine is also




easily adaptable and gives a suckling feeling to the cow and avoids pain in the udder as well as

leakage of milk.

The concern has planned to purchased all Machines and technical Equipments related to Dairy

extraction from Consultant, from Sweden whereas basic machineries i.e. Tractors, Tanker etc. will

be purchased from sXYZpliers of Domestic Market. The company is opting for state of the art

technology to extract maximum milk and keeping the quality to the highest standards possible.

List of Machineries as well as Equipment so required are provided below:

(Rs. in Lakhs)

Sr. No. Particulars Cost

1. Milking System with 12 units and automation software and auto

ID system for 250 cows

52.50

2. Instt. And Commissioning of the equipments 3.00

3. Bulk Milk Cooler 3000 Litres with pumps & accessories – 1 set 8.00

4. Consultant Cell counter 1.85

5. Vertical Mixer Wagon of 5m3 with scale system 13.50

6. Manure handling equipments - Tractor scraper with tractor 3.00

7. Slurry pumps 5.20

8. Slurry Trolley - Locally fabricated 1.00

9. Cows swinging Brushes – 2 sets 3.30

10. Dairy fans inside resting areas – 32 sets 9.12

11. Water Troughs 10 nos. 5.40

12. Cow resting cubicles for 200 milking cows 8.00

13. Cow Rubber Mats 2.60

14. Maternity cows bucket machines 1.25

15. Freight Expenses 2.00

16. Lab Testing Equipments (Fat Testing Equipments etc.) 0.50

17. Farm Vehicles, front loader for Farm activities/silage making etc. 5.00

18. Farm Equipments – Chaff cutters, Farm implement etc. 2.00

19. Al sex semen, surgical equipments. 0.60




127.72


TOTAL 134.11

� Stalling for 2*6/12 HB30 Parlour – Low Line

Stalling for 2x6/12 Herringbone Parlour fully hot dip galvanized with pit width: 2300

mm with suitable length of milking place comprising of:

• Pit Edge Bolted

• Frame construction wall/floor for 2x6/12

• Semi-Staggered Rump rail with splash guard for 2x6/12

• Staggered breast rail for 2x6/12

• Manually controlled Entrance gates operated from pit, 2 Nos.

• Exit gates operated from pit, 2 Nos.

� Milk Meters MM27BC

Consultant MM27BC milk meter delivers you all the key data needed to optimise your

herd management for better productivity and profitability. A highly accurate ICAR

approved milk meter that also monitors blood traces in the milk, milk conductivity, air

entry in the liners (kick-off, block and slip),the Consultant MM27BC delivers you fast, on

the spot milk yield monitoring and improved cow health control.The Consultant

MM27BC milk meter harnesses infrared light technology to measure the flow of milk

with extreme accuracy. The benefit is that this allows the milk to flow straight through,




with no moving parts to restrict it.This milk meter performs the following tasks as

below:

• Measure the milk yields accurately as per ICAR standards

• Measures the Conductivity values mor

• Blood Traces in the milk

• Kick-Offs and Air entry in the liners

• Fast Milk Yield monitoring and better control

� MC31 Milking Cluster

The Milking unit consists of Set of Liners and Milk tubes pulse tube. Cluster cleaners

in the pit are included in scope. The

engineered to deliver optimal performance from milking

midsized dairy operations.

• Weight: 2.7kg

• Short milk tube Ø: 12mm

• Outlet ID: 16mm

• Claw volume: 250ml

� Supply Lines

• Milk pipeline of stainless steel single looped

and pipe clamps.

• SS Ø 40 mm single CIP line per side with



Measure the milk yields accurately as per ICAR standards

Measures the Conductivity values more accurately

Blood Traces in the milk

Offs and Air entry in the liners

Fast Milk Yield monitoring and better control

MC31 Milking Cluster


in the pit are included in scope. The Consultant milking cluster MC31 is designed and

engineered to deliver optimal performance from milking-to-milking for small to

sized dairy operations.

Short milk tube Ø: 12mm

Milk pipeline of stainless steel single looped ∅ 63 mm with unions, pipe holders

SS Ø 40 mm single CIP line per side with bends, union and supports



milking cluster MC31 is designed and

milking for small to

63 mm with unions, pipe holders

ports.




• Vacuum line high, Ø 75 mm PP for ACR operation inside the automation cabinets.

• Vacuum Line, low one for each side of the parlour including Ø 50 mm PP pipes with

necessary sleeves, bends, T-pieces and support.

� Vaccum Pump Type DVP 1200

The Vacuum Pump is included with Suitable Motor and connections to the system

with safety devices.

Capacity : 1200 L / min. at 50 Kpa

Design : The vacuum pump is an air-cooled rotation pump, of vanes type. It is driven by an electric motor the pump.

Electric : 4 kW, 3-phase, 400 volts, 50 Hz

� SXYZply Lines

• 75/110 mm main vacuum line including necessary sleeves, bends, T-pieces and

supports to supply vacuum from the vacuum pumps to vacuum lines in the

parlour

• SS ∅ 40 mm suction line with unions and clamps

• SS milk transport pipe ∅ 25 mm with bends and supports between the end unit and

the cooling tank

� Consultant Cell Counter




DCC you the way to more profitable milk production With the DCC herd management

tool you can measure and monitor your cow, cow quarter or lk bulk tank somatic cell

count in under a minute, on the farm. Take control of your cows’ mastitis. DCC gives

you early mastitis detection, for cost- effective control of the spread of mastitis and

easier.

� Milking Machine BMS4 – For Sick and Maternity Cows

The Milking machines is equipped with 4 can clusters with suitable Pulsator and claw

and to be sued for Sick/freshly calved cows separately in Sick/Maternity Cow.

� TMR Feeding System – Vertical Mixer Wagon

A Consultant vertical mixer provides a good, fluffy feed mix within a short mixing time.

The unique auger design in combination with the counter knives mixes and cuts even

whole round bales

and long straw. The homogeneous mix ensures that

the cows eat all the components: concentrate and

other ingredients are so well mixed together; the cow

can’t pick out just what she likes. Distribution is simple and precise, so each groXYZ of

cows will get the right amount of good quality feed. Feed can be discharged evenly on

either side of the mixer.

� Cooling System – 3000 Litres

Cooling tank DXCR 3,000 liter with Basic cleaning system and two condensing unit 2 X

4300 W/ 3X400V each

Consultant Scope of SXYZply:-




• Bulk Milk Cooler, Direct Expansion Closed Type.

• Condensing Unit/s.

• Refrigeration Control Panel and Copper kit.

• Milk Temperature Controlling Unit.

� Slurry Pumps – ESP15

Slurry pump ESP is designed for pumping (agitation and pumping) of liquid manure in

manure pits and transfer of slurry to the main store as well as for recirculation and loading

of manure spreaders. The pump is an electrical driven low pressure centrifugal pump. The

pump is intended for use in open or closed manure pits and storage tanks. The pump is

assembled to a cross tubing, front end loader frame or to a wall attachment.

Utilities

Abundant supply of fresh, clean and soft water should be available at a cheap rate.

Electricity is the most important sanitary method of lighting a dairy. Since a modem dairy

always handles electric equipments which are also economical, it is desirable to have an

adequate supply of electricity.

The maintenance of farms requires appropriate management of utilities like proper drainage

system, sanitation facilities, consistent and regular supply of electricity, temperature

maintenance etc.

Details of utilities required has been provided hereunder as follows:-

(Rs. in Lakhs)

Sr. No. Particulars Size Area

Approx.

Rate

Approx.

Rate

Approx.

Cost

L (m) B (m) Sq. M Rs/sqm Rs/sqft Rs.

1. Storm Water Drain & Pit 750 1476 450 11.07

2. DG Set, XYZS, CVT etc - - - - - 10.00

3. Electrical Work - - - - - 20.00

41.07





TOTAL 43.12

Manpower Requirements

The manpower requirements of the farm are on a very minimal side. The reason for being a low

labour intensive farming is the use of latest mordernised technology which requires simple

monitoring the proper movement of the process flow. Hence, the manpower needs of the

company have been kept at a lower side considering the nature being capital intensive farming.

Cattle Breed

Selection of dairy cows

Following guidelines will be useful for selection of a dairy cow:

• Selection should be done based upon breed characteristics, fertility and milk producing

ability.

• History sheet or pedigree sheets which are generally maintained in organized forms

reveals the complete history of animal.

• So, whenever an animal is purchased from cattle fair, it should be selected based upon

its breed characters and milk producing ability.

• The maximum yield by dairy cows is noticed during the first five lactations. So generally

selection should be carried out during I or II lactation and that too are month after

calving.

• There successive complete milkings has to be done and an average of it will give a fair

idea regarding production by a particular animal.

Breed characteristics of high yielding dairy cows




• Attractive individuality with feminity, vigour, harmonious blending of all parts,

impressive style and carriage.

• Animal should have wedge shaped appearance of the body.

• It should have bright eyes with lean neck.

• The udder should be well attached to the abdomen.

• The skin of the udder should have a good network of blood vessels.

• All four quarters of the udder should be well demarcated with well placed teats.

EXOTIC BREEDS

Jersey

Origin: This breed was developed from the island of jersey in the English channel off the

coast of France.

Distinguishing Characters:

• The Jersey is one of the oldest dairy breeds, having been reported by authorities as

being purebred for nearly six centuries

• The color in Jerseys may vary from a very light gray or mouse color to a very dark fawn

or a shade that is almost black. Both the bulls and females are

• Commonly darker about the hips and about the head and shoulders than on the body.

• Age at first calving : 26-30 months

• Intercalving – 13-14 months

• Milk yield – 5000-8000 kg

• Dairy milk yield is found to be 20 liter whereas cross bred jersey, cow gives 8-10 liter

per day.

• In India this breed has acclimatized well especially in the hot and humid areas




Jersey

Holstein Friesian

Origin: This breed is originated in Holland.

Distinguishing Characters:

• Holsteins are large, stylish animals with color patterns of black and white or red and

white.

• Holstein heifers can be bred at 15 months of age, when they weigh about 800

pounds. It is desirable to have Holstein females calve for the first time between 24

and 27 months of age.

• Milk yield - 7200-9000 kg.

• This is by far the best diary breed among exotic cattle regarding milk yield. On an

average it gives 25 liter of milk per day, whereas a cross breed H.F. cow gives 10 - 15

liter per day.




Holstein Friesian

CROSS BREEDING: It is mating of animals of different breeds. Cross breeding is followed

for breeding animals for milk production and meat production. In India zebu breeds of cows

and non-descript cows are crossed with exotic breeds like Holstein Friesian, Brown Swiss

and Jersey bulls or their semen, to enhance the milk production potential of the progeny.

a. As selection is a slow process of genetic improvement cross breeding has been taken

XYZ as the national breeding for improving milk production in India. Cross breeding

word was initiated at NDRI Bangalore, Live Stock farm and Allahabad Agricultural

Institute. At present cross breeding work is going on at Military dairy farms, NDRI

Karnal, All India coordinated Research project son Cattle, Collaboration projects like

Indo-Swiss, Indo Australian, Indo-Danish, projects and also in the field in farmer’s he.

The feeding and management of the crosses would be better, to enable them to express

their production potential.

b. In general the cross breeds were found to have higher birth weight, faster growth rate,

earlier age at first calving, higher weight ; at first calving, higher lactation yield, longer

lactation period) shorter service period, dry period and milk production and breeding

efficiency.

c. There are several exotic breeds being used in cross breeding programme, namely

Holstein Friesian, Jersey, Brown Swiss and Reddane Holstein Friesian is found to be

best suited for fluid milk supply in cities, and where higher feed inputs can be provided

and where the temperature is temperate or sub-tropical. In contrast Jersey crosses are




ideal when the milk is meant for product manufacture and where feed inputs are limited

and the climate is trop.

Advantage:

The desirable characters of the exotic parent are transmitted to the progeny which the

indigenous parent does not have.

1. In India Cross-breeding and cows is done by using the exotic bulls and the progeny

inherit the desirable characters of the parent like high milk yield early maturity, higher

birth weigh of calves, better growth rates, better reproductive efficiency and indigenous

parents characters like, heat tolerance, disease resistance ability to thrive on scanty

feeding and coarse fodder etc.

2. In pairs the way to evolve new breeds with desirable characters. Hybrid vigour is made

use of in the progency.

3. Results are seen more quickly in characters like milk yield in the crossbred progeny.

(Source: http://bieap.gov.in/DairyAnimalManagementTheory)

Cross-breed cattle:

The crossbreeds are having exotic inheritance from Jersey, Brown Swiss or Holstein

Friesian or a combination of these different breeds. Jersey breed is known for the milk

fat percent and Holstein for the high quantity of milk.

Cross-breed cattle in India

S.

No

Name of

the Breed

Native

breed Specific region Assembling centre Remarks

1 Brown

Swiss Switzerland -

India, Pakistan & other

Asian

countries

Dairy breed




2 Holstein

Friesian Holland

Province of North

Holland and West

Friesland

Throughout the

country

(crossbreds)

Dairy breed

3 Jersey British Isles Island of Jersey Crossbreds available in

all states. Dairy breed

(Source: National Dairy Development Board)

Company Proposal

The company will import/purchase Holstein Friesian breed of cattle for this Dairy project.

Holstein Friesian’s are one of the best breed in cattle’s which provide fine quality of Milk.

Holstein Friesians are known today as the world's highest-production dairy animals.

Holsteins are large, stylish animals with color patterns of black and white or red and white.

A healthy Holstein calf weighs 90 pounds or more at birth. A mature Holstein cow weighs

about 1,500 pounds and stands 58 inches tall at the shoulder.

The 2011 average actual production for all Holstein herds that were enrolled in production-

testing programs and eligible for genetic evaluations were 23,385 pounds of milk, 858

pounds of butterfat and 719 pounds of protein per year. Top producing Holsteins milked

three times a day have been known to produce over 72,000 pounds of milk in 365 days.




Holstein dairy cattle dominate this country's milk production industry. The reason for their

popularity is clear: unexcelled production, greater income over feed costs,

MARKETING & SELLING ARRANGEMENTS

Milk is a basic necessity of life and in present scenario, milk is available in different forms such as

Toned Milk with 3% of Fat, Double Toned with 1.5% of Fat and Full Cream with 5-6% of Fat, also

milk is not provided in its pure form, many suppliers provide milk by mixing water and other

ingredients to milk affecting its basic components, the concern on the other hand is setting XYZ a

plant to provide milk in its raw form.

The product will be supplied to Co-operative societies who will be approached directly and thus

milk will be made available to them without any delay, reducing shortages in such area.

The concern is of the view to provide its product to nearby localities at present through co-

operative societies and to increase its production as well as its supply to others areas and states

whereby increasing its geographical coverage for supply of its product.

APPROVAL & CLEARANCES

Following Approvals are required from the Government authorities of the State. The company

has already applied for the following:

Approval & Clearance Authority Status

Conversion of Land from

Agricultural to Non-

Agricultural

SDO Jansath, DEF Already received approval

letter for 12110 sq. mtrs,

waiting for receipt of

approval letter (for 370 sq.

mtrs.).

Power State Electricity Board Company has power

connection & will apply for




enhancement in load after

completion of building.

INDUSTRY SCENARIO

India has the credit of being the largest producer as well as the biggest consumer of milk in

the world. It also has the world’s largest dairy herd (comprised of cows and buffalos). In

2010-11, livestock generated output worth INR 2,075 billion (at 2004-05 prices) which

comprised 4% of the GDP and 26% of the agricultural GDP. India’s milk production accounts

for 16% of total global output. The dairy industry is expected to grow 4-5% per annum. A

budgetary outlay of INR 31,560 Crores is recommended by the working group for 12th Five

Year Plan of Planning commission of India for animal husbandry and dairy sector to achieve

growth rate of 6%. In the past 20 years, milk production in India has doubled and has

reached the 116.2 million tonnes a year thus becoming India’s No.1 farm commodity. The

current market size of the dairy industry is INR 2.6 trillion and is estimated to grow XYZ to

INR 3.7 trillion by 2015.

The matters relating to livestock production, preservation, protection and improvement of

livestock & dairy development comes under Department of Animal Husbandry, Dairying &

Fisheries of the Ministry of Agriculture, GoI. Value-added products like Whole milk powder,

Skimmed milk powder, Condensed milk, Ice cream, Butter and Ghee have immense

potential for export.

As per the latest statistics of National Dairy Development Board (NDDB), the dairy

cooperative network in the country includes 177 milk unions covering 346 districts and

over 1,33,000 village-level societies with a total membership of nearly 14 million farmers.

All the statistics given above are indicators of a flourishing dairy sector in India providing

suitable opportunities to the industries engaged in the dairy business.




NABARD is an apex institution for all matters relating to policy, planning and operation in

the field of agricultural credit. It serves as an apex refinancing agency for the institutions

providing investment and production credit. It promotes development through formulation

and appraisal of projects through a well organized Technical Services Department at the

Head Office and Technical Cells at each of the Regional Offices.

IMARC Group, one of the world’s leading research and advisory firms, in its new report

“Indian Dairy Market Report & Forecast 2011-2016” finds that India’s dairy industry will

nearly double in size to US$ 116 billion by 2016. More important, changing consumer

demands, value addition, retail modernization and the nation’s increasing affluence will

remodel competition in this market and likely transform it from a highly fragmented and

unorganized to a more organized market.

Findings from the report suggest that from 16% in 2006, around 26% of the entire Indian

dairy market will be organized by 2016. Considering the demand supply gap of milk

consumption and availability and the ripe opportunity that lies in Dairy Sector in India,

apart from the Indian milk cooperatives and private dairy players, a number of foreign

companies are also considering their prospects in India. Danone - the world’s second largest

dairy company (after Nestle) is currently increasing its presence in the Indian dairy

industry and has recently launched a new Indian business unit dedicated to developing

dairy products for lower income consumers. Apart from Danone, a New Zealand

Government Foreign Affairs, Defence and Trade Committee report has revealed that

Fonterra – the world’s third largest dairy company is also investigating the feasibility of

setting XYZ dairy farms in India. Analysts from IMARC Group expect that with domestic

demand of dairy products expected to outstrip supply in the coming years, we will continue

to see foreign dairy players increasing their presence in this Industry.

The dairy industry in India has been on a steady path of progression since Indian

independence. It has grown from producing 17 million tonnes of milk in 1951 to producing

121 million tonnes in 2011. Today, India is one of the largest milk producing countries in

the world. This solid progress is primarily attributable to structural changes in the Indian




dairy industry brought about by the advent of dairy cooperatives. The Indian dairy industry

reported a market size of USD 48.5 billion in FY2011. With a Compound Annual Growth

Rate (CAGR) of 16 percent, it is anticipated to

a rise in disposable income, co

dairy industry is all set to experience high growth rates in the next five years.

World total milk production

(Including cow/buffalo/goat/sheep/camel milk)

Rank Country

World

1

2

3

4

5

6

7

8

9

10

11




Rate (CAGR) of 16 percent, it is anticipated to reach USD 118 billion in 2017. On the back of

a rise in disposable income, coupled with strong demand for dairy products, the Indian


World total milk production in 2009

FAO Statistics

(Including cow/buffalo/goat/sheep/camel milk)

Country Production

(106 kg/y)

World 696,554

India 110,040

USA 85,859

China 40,553

Pakistan 34,362

Russia 32,562

Germany 28,691

Brazil 27,716

France 24,218

New Zealand 15,217

UK 13,237

Italy 12,836



reach USD 118 billion in 2017. On the back of

led with strong demand for dairy products, the Indian





12

13

14

15

16

17

18

19

20

Government Support

Department of Animal Husbandry, Dairying and Fisheries, (DAHD&F) Gol during the

2005-06 launched a pilot scheme titled "Venture Capital Scheme for Dairy and Poultry". The

main objective of the scheme was to extend assistance for setting

other components to bring structural changes in the dairy sector. As

scheme is extended in the form of Interest Free Loan (IFL) to individuals, SHGs, NGOs,

Cooperatives, companies for selected components. As on 31 March 2010, 15368 units were

extended IFL assistance of Rs 146.91 crore throughout the count

"Dairy Entrepreneurship Development Scheme"(DEDS.)

Objectives of the scheme:

• To promote setting

• To encourage heifer calf rearing thereby conserve good breeding stock.


Turkey 12,542

Poland 12,467

Ukraine 11,610

Netherlands 11,469

Mexico 10,931

Argentina 10,500

Australia 9,388

Canada 8,213

Japan 7,909

port

Department of Animal Husbandry, Dairying and Fisheries, (DAHD&F) Gol during the

06 launched a pilot scheme titled "Venture Capital Scheme for Dairy and Poultry". The

main objective of the scheme was to extend assistance for setting

other components to bring structural changes in the dairy sector. As



extended IFL assistance of Rs 146.91 crore throughout the country.

"Dairy Entrepreneurship Development Scheme"(DEDS.)

Objectives of the scheme:

To promote setting XYZ of modern dairy farms for production of clean milk.

To encourage heifer calf rearing thereby conserve good breeding stock.

Department of Animal Husbandry, Dairying and Fisheries, (DAHD&F) Gol during the year

06 launched a pilot scheme titled "Venture Capital Scheme for Dairy and Poultry". The

main objective of the scheme was to extend assistance for setting XYZ small dairy farms and

other components to bring structural changes in the dairy sector. Assistance under the



ry.

of modern dairy farms for production of clean milk.

To encourage heifer calf rearing thereby conserve good breeding stock.




• To bring structural changes in the unorganized sector so that initial processing of

milk can be taken XYZ at the village level itself.

• To bring about upgradation of quality and traditional technology to handle milk

on a commercial scale.

• To generate self employment and provide infrastructure mainly for unorganized

sector.

Vital Stats

Milk Production in India:

MILK PRODUCTION IN INDIA

Year Production (Milion tonnes) Per Capita Availability

(gms/per day)

1991-92 55.6 178

1992-93 58.0 182

1995-96 62.2 195

1999-00 78.3 214

2004-05 92.5 233

2010-11 121.8 281

2011-12 127.9 291

Source: Department of Animal Husbandry, Dairying & Fisheries, Ministry of Agriculture, GOI.

Milk Production by States:

ESTIMATED MILK PRODCUTION – STATEWISE (‘000 tonnes)

States 1997-98 2000-01 2003-04 2007-08 2010-11 2011-12

All India 72178 80607 88082 107934 121848 127904

Andhra Pradesh

4473 5521 6959 8925 11203 12088

Bihar 3420 2489 3180 5783 6517 6643




Gujrat 4913 5312 6421 7911 9321 9817

Haryana 4373 4850 5221 5442 6267 6661

Karnataka 3970 4599 3857 4244 5114 5447

Kerala 2343 2605 2111 2253 2645 2716

Madhya Pradesh

5377 4761 5388 6572 7514 8149

Maharashtra 5193 5849 6379 7210 8044 8469

Punjab 7165 7777 8391 9282 9423 9551

Rajasthan 6487 7455 8054 11377 13234 13512

Tamil Nadu 4061 4910 4752 6540 6831 6968

XYZ 12934 13857 15943 18861 21031 22556

Source: Department of Animal Husbandry, Dairying & Fisheries, GOI

Milk Production across Countries:

MILK PRODUCTION ACROSS COUNTRIES (Million Tonnes)

Country 1970 1990 2000 2010

India 20.80 53.68 79.66 117

United States of America

53.07 67.01 76.02 87.46

China 1.96 7.04 12.37 41.14

Pakistan 7.45 14.72 25.57 35.49

Russian Federation

0.00 0.00 32.28 32.14

Brazil 7.42 15.08 20.53 31.82

Germany 28.18 31.34 28.35 29.67

France 22.85 26.81 25.74 24.21

New Zealand 5.99 7.51 12.24 17.01

United Kingdom

12.97 15.25 14.49 13.96

Poland 14.96 15.84 11.89 12.30

Netherlands 8.24 11.23 11.16 11.65

Mexico 4.11 6.27 9.44 10.84

Argentina 4.19 6.28 10.12 10.50

Australia 7.76 6.46 10.85 9.02

Canada 8.31 7.98 8.16 8.24 Ireland 3.08 5.40 5.16 5.24

Romania 3.12 3.81 4.62 5.06

Denmark 4.48 4.74 4.72 4.91

Switzerland 3.20 3.88 3.91 4.11 Bangladesh 1.07 1.59 2.14 3.40

Austria 3.36 3.37 3.36 3.29




South Africa 2.91 2.48 2.54 3.23

Sweden 2.93 3.51 3.35 2.92

Chile 1.12 1.39 2.00 2.54

Finland 3.31 2.82 2.45 2.35

Afghanistan 0.75 0.83 1.66 1.82

Nepal 0.63 0.92 1.17 1.58

Norway 1.73 1.99 1.74 1.58 Indonesia 0.17 0.60 0.79 1.32

Thailand 0.00 0.13 0.52 0.85

Mauritania 0.24 0.27 0.32 0.39

Vietnam 0.02 0.06 0.10 0.34 Sri Lanka 0.14 0.25 0.16 0.21

World 391.82 542.47 578.88 720.98

Source: Department of Animal Husbandry, Dairying & Fisheries, Ministry of Agriculture, GOI.

RATIONALE

• India is the second largest country in the world in population and has a huge gap

between demand & supply of milk, thus providing ripe opportunities to dairy farming

business particularly in organized sector.

• With per year milk production growth on 1.5 percent per annum only, demand is

growing yearly with more than double of production as per growth of population

• Several financial incentives provided by the governments for setting XYZ

infrastructural facilities for milk production. Government provides subsidies on loan.

• Dairy farming being a priority sector manages to obtain loans easily.

• The demand of milk and its products is active year round. This not being a seasonal

product makes the demand for milk to increase day by day.

• With state of the art technology, organized sector in dairy farming has vast scope for

cashing in on the latest technology available at hand and provide milk in higher

quantities with fine quality.




• Unlike other agricultural sectors, dairy sector is not dependant on rains and

production can go on throughout the year.

• The gestation period in this business is very low. Returns on this business are

available within a month. Today, virtually no other business offers such a short

gestation period.

• Use of by products provides additional income and increases returns. For example

dung can be used to produce biogas for cooking and even as manure and compost.

• Veterinary aid is available at most of the villages in India.

• Complete automation and hence better control and less labour. Automated feeding

practices and hence better yield

Benefits for modern Dairy Farming

• Technology for Securing Quality

• Recovery of Manure for agriculture, organic food

• Better animal health and hence better productivity

• Higher herd size with better efficiency

• Better financials as maximum efficiency could be achieved

• Breeding Improvement

• Quality Milk Production

• Better Cow health

• Affordability of farm expertise

• Hands free milk

• Less bacteria Count

• Improved shelf life

• Improved value added product




Unique Selling Points

• Hailing from a farming background the promoters are a veteran in the field of

maintaining cows and operating farms with completely mingling into such ambience

of farming.

• ABC Dairy Farms are hiring a battery of professionals which are excellent in their

work and experience over handling a dairy farm, maintenance of cows including herd

management.

• The organized sector has started taking place in Dairy Farming industry providing a

much wanted boost to the industry to meet the unfulfilled demand of milk. ABC Dairy

Farms are utilizing the untapped potential of organized sector in dairy farming

providing the quality milk with much greater quantities.

• The state of the art technology brought in from Sweden is being installed to maximize

the extraction with utmost precision in terms of quality of milk without hurting the

cow udder.

• ABC Dairy Farms are surrounded by many residential cities offering it a wide scope

for sale of milk produced.

• Holstein Friesians cows are one of the highest and best milk producing cows in the

world. ABC Dairy Farms are inducing HF cows for their excellent production, greater

income over feed costs and ability to adapt to wide of range of environmental

conditions.

• Healthy relations and connections with co-operative society’s will ensure consistency

in sales.

SWOT ANALYSIS




Strengths:

• Demand Profile: The demand for milk is continuously growing on regular basis and

thus is an upward rising industry and will prove to be valuable.

• Margins: When compared with cost, Margins in this sector are reasonable and

justified.

• Flexibility: Although company is involved in production of Milk but the dairy

industry is immensely flexible as company can increase its product line any time in

future, like processing of milk and milk products, etc.

• Availability of Cattle: Basic requirement for this industry are availability of cattle’s,

though cattle are available in abundance but company is using HF breed cattle for

better quality of milk.

• Reduced Manpower Cost: Since company is relied upon capital intensive structure

for its project thus, less manpower is required which are available for dairy farming

activities as India is the hub of Dairy production.

Weakness:

• Perishable Nature: Though product is highly perishable in nature creating

circumstances of either sell the output on daily basis as per production or produce

upto the requirement but pasteurization of milk has enhanced its life and proper

storage conditions also provided security to milk deterioration.

• Unproductive Yield: Although India is producing the most Dairy products when

scaled on World scenario but still the yield is not quite productive, the company, with

the use of HF, mixed breed, cattle will extract and supply milk of enhanced quality.

• Fodder Distribution: Basic requirement in this industry is Fodder for feeding the

cattle, but is not properly available and thus high carrying and storage cost are




associated, so company has tie XYZs with local suppliers for supplying/ meeting the

fodder requirements as per its demands.

• Competition: With so many newcomers entering this industry, competition is

becoming tough. The scale of competition is increasing continuously but since the

company will supply raw milk in organized sector, where the demand is high,

company will emerge as a major producer and can be highly benefitted.

Opportunity:

• Value Addition: There is a phenomenal scope for innovations in product

development, packaging and presentation. Given below are potential areas of value

addition:

o Steps should be taken to introduce value-added products.

This will lead to a greater presence and flexibility in the

market place along with opportunities in the field of brand

building.

o Addition of cultured products lends further strength - both

in terms of utilization of resources and presence in the

market place.

• Available Potential Opportunities: Since India is the hub of dairy farming, high

profitability exists in opportunities for the export of agri-products in general and

dairy products in particular.

Threats:

Milk Vendors, the Un-Organized Sector: Today milk vendors are occupying the pride of

place in the industry. Organized dissemination of information about the harm that they

are doing to producers and consumers should see a steady decline in their importance.




The study of this SWOT analysis shows that the ‘strengths’ and ‘opportunities’ far

outweigh ‘weaknesses’ and ‘threats’. Strengths and opportunities are fundamental and

weaknesses and threats are transitory.

Documents

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