PROJECT

MANAGEMENT
Feasibility Report for setting up multispecialty hospital in Guwahati

Kalyani Vhatkar 99
Nimmy Jose 98
Mansi Jain 97
Vivek Vijayan 100
Mudassir Khan
Rahul Sharma
Arshad Sopariwala

Table of Contents
Executive summary ............................................................................................................................... 2
Introduction .......................................................................................................................................... 3
Location Guwahati ................................................................................................................................ 3
Economy ........................................................................................................................................... 3
Infrastructure .................................................................................................................................... 4
Current Healthcare Scenario.............................................................................................................. 4
Technical Analysis ................................................................................................................................. 5
Service Offered.................................................................................................................................. 5
Location and site ............................................................................................................................... 5
Land availability:................................................................................................................................ 5
Hospital Plan ......................................................................................................................................... 6
Hospital Rooms ................................................................................................................................. 6
General Layout .................................................................................................................................. 6
Building ............................................................................................................................................. 7
Layout of Services: ........................................................................................................................... 10
UTILITIES ......................................................................................................................................... 11
Schedule of project implementation.................................................................................................... 13
Organisation Structure ........................................................................................................................ 14
Costs ................................................................................................................................................... 16
Capital Outlay of the Project and Means Of Finances ........................................................................ 16
Estimation of Project Cost ................................................................................................................ 17
Land and Site Development ............................................................................................................. 17
Cost of Equipments.............................................................................................................................. 19
Preliminary and Preoperative Expenses............................................................................................ 26
Working Capital and Marginal Money .............................................................................................. 28
Manufacturing Inputs and Cost ........................................................................................................ 30
Appendix and Tabulations ................................................................................................................... 36
Working Results and Profitability ..................................................................................................... 36
Sales Revenues ................................................................................................................................ 37
Estimation of Working Results (Rs Lakhs) ......................................................................................... 38
Pay Back Period ................................................................................................................................... 39

Executive summary
The largest city of Assam, Guwahati is considered as the gate way to the North East Region of the
country. The entire North East is connected with rest of the country through Guwahati. The Capital of
Assam, Dispur lies in this city. Guwahati is one of the most rapidly growing cities in India. According to a
survey done by a UK media outlet, Guwahati is the 100th fastest growing city of the world, and is the 5th
fastest growing among Indian cities.
The city has many high end government and private hospitals, nursing homes with all modern and
advanced technology for which it has become an important center for health facilities in eastern India.
Some of them are the Guwahati Medical College and Hospital, Guwahati Neurological Research Centre
(GNRC), Down Town Hospital, B. Baruah Cancer Institute, and Sankardeva Netralaya (eye hospital). Team
of highly qualified doctors, specialists from other metros and outside India and advanced technical
equipments are available in Guwahati for better health services. The city has the centers for Ayurvedic
and Homeopathy treatments.
Guwahati Medical College and Hospital is under going a massive renovation-cum-modernization plan
with world class equipments. Hundreds of Crores are pumped into the infrustructural facilities for this
biggest regional medical center. Already foreign medical tourists has trickle in and it can be a major boost
to the economy of the region, if utilised fully.
Hence we propose to have a 200 bed multi-speciality hospital, which can add to the existing medical
infrastructure and also address the states ambition to turn the Guwahati into a regional healthcare hub.
The estimated cost for our hospital project would be INR 1680 Lakhs. Out of this INR 1180 Lakhs would
be financed through debt and INR 500 Lakhs would be through equity.

Introduction
There is urgent need for moderate to excellent health care facilities in the Northeast. Moderate
size hospitals of 200 bed capacity can be set up at city / district head quarters. These hospitals
equipped with modern medical equipments offer excellent services for the patients suffering from
various diseases.
This PreFeasibility Study is prepared with an objective to provide basic information about hospital
project for prospective entrepreneurs, who may or may not have a medical background. It
covers extensively aspects such as: Services to be offered in the hospital, Details of hospital
equipments, Support facilities, Elaborated list of medical equipments, Various fixed assets required,
No. of medical/ paramedical/ nonmedical staff required, Cost of suppliers and consumables,
Revenue details, Estimation of cost of project and means of financing, Estimates of profitability,
Estimates of all key financial indicators such as payback period & Break even point etc.

Location Guwahati
Guwahati City Overview
Guwahati city is governed by Municipal Corporation which comes under Guwahati Metropolitan
Region. The Guwahati city is located in Assam state of India.
Guwahati Population 2011
As per provisional reports of Census India, population of Guwahati in 2011 is 963,429; of which male
and female are 502,255 and 461,174 respectively. Although Guwahati city has population of 963,429;
its urban / metropolitan population is 968,549 of which 505,542 are males and 463,007 are females.
Guwahati Literacy Rate 2011
In education section, total literates in Guwahati city are 798,726 of which 426,401 are males while
372,325 are females. Average literacy rate of Guwahati city is 91.11 percent of which male and female
literacy was 92.89 and 89.16 percent.
Guwahati Sex Ratio 2011
The sex ratio of Guwahati city is 918 per 1000 males. Child sex ratio of girls is 1009 per 1000 boys.
Guwahati Child Population 2011
Total children (0-6) in Guwahati city are 86,806 as per figure from Census India report on 2011. There
were 43,217 boys while 43,589 are girls. The child forms 9.01 % of total population of Guwahati City.
Economy
The gross domestic product of Guwahati metro was estimated at $1 billion in 2010. As a river port,
Guwahati has traditionally been an important administrative and trading center. Separate income
estimates are not yet available as city-level income estimation is not a traditional practice in India, and
is not practiced in a systematic and continual manner.
The major economic activities are trade and commerce, transportation and services. Guwahati is the
most important trade hub in the North Eastern Region. It is a major wholesale distribution center, a
marketing hub, and also a retail hub of the region.
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Infrastructure
Although being a medium sized city, ranking around 50th (in terms of population) in India, the city's
quality of life is comparatively higher. A 2006 survey by a popular Indian magazine - Outlook (Money)
ranked Guwahati 16th among all the major and medium sized Indian cities.
The city provides residential and working environments with beautiful landscapes, pleasant climate,
modern shopping areas, modern apartments and bungalows, and good social infrastructure. Yet
infrastructure in the city still requires extensive attention, to improve the city's reputation, investment
environment, and overall growth pattern. Major investments in infrastructure are being planned in the
city, covering many aspects of the utilities and transportation infrastructures, with financial assistance
from the Asian Development Bank(ADB).
Current Healthcare Scenario
In Guwahati, there are 1 District Hospital, 3 Community Health Centres, 25 Public Health Centres and
51 Sub Centres
Standard of Living Index
Low (%)
Medium (%)
High (%)

Total
41.4
31.5
27.2

Rural
52.2
28.5
19.4

As you can see the standard of living is high for 27% of the population of Kamrup and even more for
the metro of Guwahati. Even though there are many hospitals running in Guwahati, they are
overloaded with patients coming from all around the state.
With the states ambition to turn Guwahati into a healthcare hub, we can expect great occupancy and
profitability for the hospital.

Technical Analysis
The broad purpose of this analysis is to ensure that project is technically feasible in (a) the sense that all
inputs required to set up the project are available and (b) to facilitate the most optimal formulation of
the project in terms of technology, size, location, etc.
Service Offered
Emergency Medicines

ICU/CCU, casualty, 2 major OTs

General Medicine

Minor OT, consulting rooms, Nursing Stations

Pediatrics & Neonatology

Nursery, Intensive Neonatal Care, Facilities for Anesthesia, Ventilation,

Incubation

Xray imaging
Pathology

Mobile xray unit 100 mA for Nursing home and 500 mA xray Machine
in OPD, CT Scan machine
Histopathology, Hematology, Serology, Microbiology & Biochemistry

Gastroenterology

Endoscopy

Cardiology
Physiotherapy
Ophthalmology

ECG, stress test with treadmill, Ultrasound Cardiac Investigation

Infrared therapy, ultra Violet therapy, Shortwave Diathermy, high
Frequency physiotherapy, Traction, stimulation, Physical fitness
General Surgery

Orthopedics

General Surgery

Gynecology

Multibed,
multiparameter
Monitoring
Colonoscopy,
Laparoscopy
&
Doppler
Foetus
Detection, Ultrasound
abdominal/ob/Gynec Investigations, 3 labour rooms, 2 delivery rooms

ENT

Examination, general surgery, respiration Function screening

Casualty/Emergency

Resuscitation

Nephrology

Dialysis

Location and site

Land availability:
The total land area for the project is about 2 Hectares. As we are setting up hospital in the outskirts,
required land is available at a nominal rate. Guwahati also has the advantage of proximity. With the city
as a hub, patients requiring specialised treatment from anywhere in the North East and even North
Bengal, Bhutan and Bangladesh can come here.
Labour situation
Labour issue are prevalent. However, we can tie up with two prominent NGOs (i.e. SEARCH and Lok
Biradari Prakalp) who have earned credibility over the years in the public health domain in the region.
Infrastructure
Guwahati is well connected by road and railways

Govt policies
Assam government is aiming to turn Guwahati into a regional hub for healthcare catering to patients not
only from the North East but also from neighboring countries of Bhutan and Bangladesh. So, we will get
tax benefits.
Hospital Plan
Hospital Rooms
The planned hospital will have total numbers of 200 beds .Break up of bed capacity in the hospital is
given as under:

Facility

Numbers

Regal Suits (4 nos.)

Deluxe Single rooms (10 nos.)

10

Single bedded rooms (34 nos.)

34

Double bedded rooms (20 nos.)

40

Triple bedded rooms (10 nos.)

30

Six bedded general wards (6 nos.)

36

ICU (2 nos.)

CCU (2 nos.)

Neonatal

20

Emergency

10

Total

200

The general wards can be further divided into two or three bedded cubicles for increased
flexibility, depending on the requirements; similarly, two bedded rooms will have the flexibility to be
converted to single rooms. One nursing home should be located on each floor of the hospital. It will be
seen that majority of beds are in the single bedded, double bedded and triple bedded rooms so as to
cater specialized and personalized care to the patients. The regal suits and the deluxe single bedded
rooms will attract the high income group patients.
General Layout
The hospital will consist of 4 blocks as follows:
Block I Nursing home & utilities
Block II Out patient department
Block III Chemist shop & canteen
Block IV Staff Quarters
Block I should be situated away from the main road at the south west corner of the plot. This will
ensure patient comfort and will also be free from noise and air pollution, which make the atmosphere
of hospital conducive for complete rest without disturbance.
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Block II should be located near the main road and main gate of the hospital. This is so planned
because of flow of the large number of out patients and their relatives throughout the day.
Sufficient distance is to be provided between the Block I and Block II to avoid noise pollution in Block
I. The diagnostic center will also be provided in Block I as this department will be used both by
outpatients, a sample collection room, pathology lab, one Xray unit, one ultrasound equipment,
ECG machines and physiotherapy should be provided in Block II.
Block III should be between Block I & Block II, so that the chemist shop and canteen can cater to
both the Blocks simultaneously as this is at almost equal distance from both the Blocks. Block III
location should be such that the noise pollution due to the Block is minimum and at the same time
the distance is shortest possible between the two.
Block IV should be located slightly away from all other blocks being a residential one for essential
staff.
Suitable provision should be made for internal roads, parking areas as also the development of
green areas in the rest of the land to provide the necessary environment of general cleanliness.
Building
Architectural Principles:
The building for the hospital is to be designed taking into consideration various aspects like
direction of sun light, wind, seismic characteristics, soil strength, water level, rainfall etc.
Design & Concept:
In the design conceptualization, particularly the inpatient block, the orientation is maintained
towards East and West, in order to get maximum sunlight, adequate open spaces around the
Blocks are left in order to provide aesthetics, ventilation and light in the rooms and to avoid
congestion. Further, the inpatient block should be kept farther from the main road in order to
reduce the noise level, dust as well as smoke emitted by the vehicles moving on the main road.
All the toilets have to be positioned on the outer side to have direct ventilation and to simplify
plumbing.

The relationships between and within departments are directed by the rational functional
requirements of the hospital. The in patient wards offer privacy and comfort (being segregated)
and being served by nursing stations, which are so placed as to facilitate the nursing need of each
patient. Each nursing station is self-contained and close by service elevator to reduce undue traffic.
The building is designed to have common and consolidated service area so as to serve the hospital
more effectively.
Block I Layout:
BlockI will have three floors excluding the utilities area. However, the foundations shall be designed to
support a fivestoried building to cater for future expansion of capacity. The hospital will have 100 beds.
The building for utilities will be single storied. The layout of various departments/ services will be as
follows:
a) Ground Floor: The ground floor will have:

Reception
Casualty/ emergency/ day care with 10 beds
Xray facility
Minor OT capable of handling emergency cases
Treatment/ plaster room for casualty/ emergency
Neonatal room
Medical gas supply system near the road for easy loading/ unloading of gas cylinders
Central sterile supply depot
Laundry will be situated at the southwest end
Kitchen (next to laundry in north direction)
Substation slightly away from laundry
Morgue is also provided away from the hospital building
Eastern part of the hospital is for the inpatient and consists of 2 six bedded rooms, 3 triple
bedded rooms, 4 doublebedded rooms, 2 deluxe rooms and 8 single bedrooms.

A nursing station, clean utility room, duty room and pantry are also to be provided on each floor.
b) First Floor: The first floor will have:

Delivery rooms provided above the casualty and minor OT

3 Labour rooms
Sterilization room
20 bedded neonatal care room with isolation facility as well as intensive care
Dirty utility room
Clean & dirty corridor
Doctors & nurses change rooms
Nursing home wards & rooms which provide for 2 six bedded rooms, 3 triple bedded rooms, 4
double bedded rooms, 6 deluxe rooms, two regal suits and 20 single rooms. A nurse station,
clean utility room, duty room, pantry & store are also to be provided.

c) Second Floor: The second floor will have:

2 major O.Ts
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OT operation area
Corridors for movement of clean & dirty utilities, separate clean & dirty utility rooms are
provided
Doctors & nurses change rooms
Recovery room
ICU (4 beds) x two numbers
CCU (4 beds) x two numbers
Hospitals wards & rooms
Room for technician

Nursing home wards & rooms which provide for 2 six bedded rooms, 4 triple bedded rooms, 4 regal
suits, 2 delivery rooms,2 double bedded rooms, 6 single rooms and 2 deluxe rooms. Further a nursing
station, duty room, pantry & store are catered for.
Block II Layout
It will have 2 floors. The details are as under:
a) Ground Floor:

The main entrance for OPD will have a reception/ registration/ cash counter in the main lobby.
3 consultation rooms to be used in 4 shifts with adequate waiting area.
Physiotherapy room.
XRay room & waiting room.
Ultrasound room
Sample collection room
Staircase

b) First Floor:

4 consultation rooms to be used in 4 shifts with adequate waiting area

Laboratory for histopathology, biochemistry, microbiology, haematology & serology and
immunology
Stress test room
ECG room
Endoscopy room
Corridors are provided for easy man & material movement.

c) Parking: A small parking area is provided in front of the OPD block.

Block III Layout
Block III consists of chemist shop, which will operate round the clock. This would have two separate
entrances i.e. one for the public and another for the hospital staff. This would permit speedy
transactions for the hospital staff where the medicines would be issued based on intends and also
accounted for separately.

Block IV
Consist of a single floor with 25 single rooms to accommodate essential hospital staff.
A canteen for hospital and visiting relatives of the patients etc. should be located adjacent to the
chemist shop. This will be operated by a contractor who will bring his own equipment and furniture.
Toilets for the use of OPD patients, visitors etc are also to be provided.
Public Convenience:
Adequate number of public conveniences and toilets for the visitors and staff has to be catered for in
the design of the hospital building.
Layout of Services:
To ensure a smooth flow of services in the hospital, it is important that the layout of services should be
as per the men and material flow, inter dependence of services and departments, requirement of
utilities and services etc. The floor wise layout details are as follows:
a) OPD Block:
To ensure that the OPD block is self sufficient up to the extent required, various allied services
have been catered in the block. The block has to have consultation rooms with appropriate
waiting area for patients, treatment/ injection room, sample collection room, pathology lab,
physiotherapy room, an Xray unit, ECG and Ultrasound facility and a registration desk to
monitor, control, guide and redirect the patients.. The reception desk will also act as the
cashier for the OPD block. Adequate waiting area for the patients is to be provided for these
rooms catering to take care of the peak hour traffic. The sample collection room has to be close
to the main entrance to avoid congestion.
b) Nursing Home Block:
The nursing home block is located on three floors with various types of accommodation to suit
the paying capacities of the patients. Each floor has a nursing station for providing necessary
assistance to the patients, which will be manned round the clock. Behind the nursing station
there will be provision for support services like store, pantry, dirty linen store, etc. and the
services lift will open in this area for ease of transporting of material (used and fresh supplied).
The registration is on the ground floor with a separate entrance with the bed/ passenger
lift opening in the lobby. The reception desk will have a computer terminal and will also take
up the role of cashier. This desk will also be manned round the clock.
c) Maternity Services:
The first floor above the emergency/ minor OT should have the maternity facilities in the area.
This will be in proximity of the nursing home complex as the first floor of the nursing home
will have to house the gynac patients. The labour rooms, doctors rooms, delivery rooms,
neonatal care rooms, (ICU)/ normal/isolation wards) etc. should be in the same area for ease of
functioning.
d) Operating Theatres:
The operation theatres (2 nos.) should be located on the second floor above the maternity
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section. These should be totally airconditioned and ultra pure air system should be installed.
The OT area should include the patients preparation area, anesthetics area, doctors, nurses
and technicians change/ rest rooms, toilets, scrub room etc. It should be separated from the
operation theatre by a clean corridor. From the Operation Theatres, the patients will be
transferred to the recovery rooms, which is a part of ICU/CCU unit located adjoining to the
Operation Theatre.
e) Utilities:
All the centralized utility services should be provided on the backside of the building which
is a single storied structure. These include areas for kitchen, laundry, stores, CSSD,
transformer/ generator room, incinerator etc. The management would be easier since these
facilities are grouped together. This service area should be connected to the hospital/ OT areas
by a service corridor and a service lift for smooth operations.
UTILITIES
Power Supply System: The total estimated maximum load of the hospital would be 650 KVA. This
requirement has to be met from the State Electricity Boards supply. To provide uninterrupted power
supply to the hospital, a set of stand by DG sets will have to be catered. The power supply system
will consist of: Sub station equipment and Standby DG sets (2x3560 KVA).There will be two DG sets to
supply all the power needed including the AC units.
Standby DG Sets:
To take care of the power failure of the grid, hospital will be provided with two standby diesel
generating sets with a total capacity of 700 KVA.
Medical Gas Supply System: A central gas supply system shall have to be provided for the distribution
of medical gases to various departments of the hospitals.
Gases required are Oxygen and nitrous Oxide along with suction. The ventilators will be operated by
means of Oxygen. There will be a central storage tank for these gases and distribution will be through
copper pipes. A compressor is to be used for the delivery of gases to various points. Separate pipelines
will have to be installed for this purpose.
Fire Fighting System: For meeting the emergency in case of fire in the hospital, proper fire fighting
equipments, will be provided at all the sensitive areas, due care about the safety regulations has to be
taken into the account.
Lifts: The hospital need to have two hospital lifts for the movement of patients, doctors, stretchers,
and wheel chairs, Visitors etc.
Laundry: Laundry has to be provided with the necessary facilities to meet the basic hospital needs. The
hospital will be generating about 100 Kg. of dirty linen per day for washing. To cater for this adequate
provision in terms of basic infrastructure has to be provided. The operation of the laundry can be on a
contract basis. Besides this, the following can be added in the later stage Washing machine with
spinner of 50 Kg/charge, sluicing machine of 7 Kg/charge, and Hydro extractor of 25 Kg/charge. These
machines are operated with steam. Hence a boiler of 300 Kg. / hr capacity will be also required.
Boiler: One industrial horizontal smoke tube design oil fired boiler capable of generating 300 Kg./hr.
of steam (F & A 100 degree centigrade) at the maximum working pressure of 150 psi (10.54 kg. Sq. cm.)
along with control panel and mobrey controls. Accessories to this boiler to include: Guy rope type
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chimney of diameter 250 mm & height 15 mtr and MS soft water tank capacity 1000 litre.
Kitchen equipments: The hospital will have its own kitchen with basic facilities to meet the
requirements for the patients IPD. Quality control will be carried by the full time dietician. Besides the
hospital will also have a canteen facility for the outpatients and visitors which will be operated by a
contractor.
Waste Disposal: Liquid Waste generated by the hospital will be directly disposed of in main sewer line
which already exists in the area. Solid waste like, cotton bandages, dressings etc. will be disposed off
by incineration.
Transportation

Ambulance: The hospital need to have two ambulance (Tata 407 model or other make) for
attending to the emergency from outside and bring the casualties/ emergency patients to the
hospital for treatment. Ambulance has to be available for the patients who are discharged and
are recommended for complete rest. This facility will be available on payment basis with a fixed
minimum charge and additional charge depending upon the distance. The ambulance will have
all modern first aid facilities

Vans
Environmental aspects
The Hospital would be, as far as possible, environment friendly and energy efficient. Rain-Water
harvesting, solar energy use and use of energy-efficient bulbs/equipment should be encouraged.
Provision is made for horticulture services including herbal garden. A room to store garden implements,
seeds etc. will also be made available.

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Schedule of project implementation

A construction program has been developed to accomplish the desired objectives within a time span
which is as short as possible without being excessively curtailed. A time span of 16 months for project
completion defined by erection and commissioning of the hospital is estimated. Following table gives
the time schedule for major works to be carried out in the implementation of the project.
Phase
Preliminary
and
Promotional work
Procurement of land
and site development
Construction
of
building
and
structures
Design
and
engineering
Ordering
and
procurement
of
equipments
Errection
and
commissioning
Startup of hospital

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12

13

14

15

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Organisation Structure

Dean

Director
Medical
Staff

Nursing
Staff

Medical
Spdt

Engineering
Staff

Admin Staff

Other staff

a) DEAN
b) Board of Directors: The Board of Directors would lay down major politics for effective hospital
administration. These include policies concerning capital outlays, expansion and modernization
programs, micro level financial control etc.
c) Medical Superintendent: The medical superintendent. Will be a doctor, with experience of
hospital management activity and will be competent to take decisions for the efficient dayto
day functioning of the hospital. He will be responsible for implementation of the hospital. He
will be responsible for implementation of the various policy of the Board of Directors/Chairman.
He will be supported by medical superintendent and general administrator. He will look the
general administrator activities of the hospital through general administration.
d) Heads of Deptts. (Medical): They would be senior specialist and will manage their respective
departments. They would interact to Deputy Medical Superintendent and would be responsible
for the daytoday activity of their departments.
e) Heads of Deptts. (Nonmedical): They would be specialists in their respective fields and would
be responsible for daytoday activities of their departments. They will report directly to the
general administrator. These include Personnel Manager, Finance Manager, Systems Analyst,
Materials Officer (Medical and Nonmedical), Accounts Officers and Security Officers etc. They
will be assisted by Non medical staff suitably.

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Manpower:
-

a) Paramedical Staff:
Cardiac Center Technician
Dialysis Technician
Pharmacist & assistant Pharmacist
Steward/Dietician
ECG Technician
Ultrasound Technician
Xray Technician
Clinical Pathology Technician
Haematology Technicians
Physiotherapist
Endoscopy Technician
Orthopaedician
Ophthalmology Assistant
Darkroom Technician
Laundry
CSSD
b) Engineering Staff:

The staff will include technicians for:

Electricity
- Mechanical/Plumbing
- Boiler
c) Nursing Staff:
Ward master reporting to Deputy Medical Superintendent. He will also be functioning as PRO to
the hospital. His responsibilities include insuring smooth functioning of hospital wards and
rooms.
- Matroninchief
-

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Deputy Matron
- Staff Nurses
d) Administration and Ancillary staff:
The administrative and ancillary staff in addition to senior administrative staff given above will
consist of the following:
- Head Clerk
- Cashier
- UDC/LDC/Typists/Stenographers
- Record Officers
- Housekeepers
- Administrative Assistants
- Telephone/Telex Operators/Receptionist
- Drivers
- Nursing Orderly
- Security Attendants
- Gardeners
- Cooks
- System Analyst
- Computer Programmer/Operator
Costs
Capital Outlay of the Project and Means Of Finances
The estimated project cost is Rs. 1583.00 Lakhs. The debt: equity ratio considered for this project is
approximately 2:1. It is proposed that the project will have equity of Rs.500 Lakhs and rest Rs. 1150
Lakhs can be raised as long term loan from the financial institutions. The project cost and means of
finance is presented in Table below

S. No

Details

Cost (in Rs Lakhs)

1.

Land and Land development

84.00

2.
3.
4.
5.

825.50
235.70
170.00
26.62

6.

Buildings
Plant & Equipments
Miscellaneous Fixed Asset
Preliminary Expenses
Preoperative Expenses

7.

Margin money for working capital

81.98

8.

Contingencies

91.32
1660

Total

144.88

Means of Finance
1
2

Loan
Equity
Total

1160
500
168
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Estimation of Project Cost

In the estimation of the project cost, the requirements and costs of various fixed assets such as land,
buildings, plant and machinery and other miscellaneous assets is considered. Besides these costs there
are certain preliminary and preoperative expenses which are incurred in the project. Once the project is
set up, in order to run it working capital is required. Since bank provides only part of requirements of
working capital, marginal money is required to successfully operate the plant. Since the requirement of
the marginal money is of long term nature, it is also considered as a part of the project cost.
Land and Site Development
The total covered area of the hospital is estimated at 10,000 Sq. meters. This includes the area required
for the main hospital, utilities section, laboratory, Administrative office; Go down, public conveniences
etc. Taking this into consideration and provisions for roads, pavements and future expansions, the land
requirement for the proposed unit has been estimated at 20,000 sqmeters. The cost of this land is
estimated at Rs. 70.0 lakhs
Cost of Land and Site development
1. Land 20,000 square meters @ Rs. 500 per square meters including registration
charges
Rs 100.00 Lakhs.
2. Site clearing, levelling and other development cost
Rs 4.00 Lakhs
Total
Rs 104.00 Lakhs
Building and Structures
Estimates for building and structures: Covers the cost of construction of various buildings for the
hospital, utilities section, administrative office, Godowns, laboratory, workshop, accommodation for
hospital staff etc. The total covered area of the hospital is estimated at 12,500 sqmts. The cost of
the building and structures is estimated on the basis of area and volume and also on the type of
foundation to be adopted for various items of equipment.
Cost of Building and Structures
The hospital will consist of nursing home and utilities buildings, OPD buildings, chemist shop and
canteen. The building should be so designed to have provision of future expansion by increasing the
floor level.
Hospital Building
A) Block (I) This building is planed to accommodate 200 no. of beds along with the supportive
services and future expansion provisions. The total covered area of the building distributed upon
three floors shall be as follows:
a) Ground floor
2000 Sqmeters
b) First floor
2000 Sq meters
c) Second floor
2400 Sqmeters
The structure shall be RCC class a construction with PVC flooring, excellent sanitation and drainage
systems, maximum provision for natural air circulation & best utilization of sunlight, good quality
fans, dust proof anti damp wall, paints on all three floors on an area comprising 6400 sqmeters. @
Rs. 10,000 per sqmeter:
Rs 640 lakhs
B) Block (II) The two floored OPD & utilities unit will house Reception / registration/
cash counter in the main lobby at ground floor and first floor will have consultation
rooms etc.
The structure shall be RCC class a construction with PVC flooring, excellent sanitation and drainage
systems, maximum provision for natural air circulation & best utilization of sunlight, good quality
17

fans, dust proof anti damp wall, paints on all three floors on an area 800 sqmeters. @ Rs. 10, 000
per sqmeter
Rs 80.00 Lakhs
C) Block (III) The single floor unit of chemist of shop and canteen will have a total area of 200 Sq
meter @ Rs. 400 / per square meter.
Rs 8.00 Lakhs
D) Block (IV) The single unit accommodation of essential hospital staff with total area of 2500 Sq
Meter @ 3500/ per Sq Meter. for 25 nos essential staff. Rs. 87.5 Lakhs
E) Other Facilities
1. Flushing cisterns, sewers, septic tank etc
2. Boundary wall, parking site, watchmans cabin
3. Architects Fees : Rs 10 Lakhs
Total: (A+B+C+D+E) = Rs. 855 Lakhs

18

Cost of Equipments
SI. No. Description
I
A
1
2
3
4
5
6
7
8
9
10
11
12
13
B
1
2
3
4
5
6
7
8
9
10
11
12
C
1
2
D

Clinical Pathology
Histopathology
Binocular Microscope
Automatic Tissue Processor
Precision Rotary Microtome
Freezing Microtome
Tissue floatation bath
Microtome knives
Block Holders
Tissue Embedding Moulds
Blood Cell Counter
Micro slide cabinet
Vertical Laminar A/Flow cabinet
Blood Bank Refrigerator
Miscellaneous
Sub Total A
Haematology & Serology
Water Bath
Water Bath Serological
Hot air Ovens
Bacteriological incubators
Shaking machine
Electrophoresis Equipment
Refrigerators
Centrifuges
Monocular Microscope
Precision Balance
Colorimeter
Miscellaneous
Sub Total B
Microbiology
Binocular Microscope
Miscellaneous
Sub Total C

Bio Chemistry
1 Auto Analyzer
2 Spectrophotometer

Qty. nos

Unit Price
(in Rs)

Total Cost ( in Rs. )

2
1
1
1
1
6
75
75
1
1
1
2
lot

8500
21000
14000
5300
2400
1000
30
30
900
7500
40000
36500
20000

17000
21000
14000
5300
2400
6000
2250
2250
900
7500
40000
73000
20000
211600

2
2
2
2
2
1
2
4
2
1
1
1

3200
5500
9500
9500
7600
12000
8000
2000
4000
7000
7000
15000

6400
11000
19000
19000
15200
12000
16000
8000
8000
7000
7000
15000
143600

2
lot

8000
15000

16000
15000
31000

1
1

90000
20000

90000
20000

19

3
4
5
6
7

II
1
2
3
4

III

Paediatrics & Neonatology

Infant Incubators
Phototherapy Unit
Cardio Respiratory Temp Monitor
Miscellaneous
Sub Total II

Nephrology
1 Haemodialysis M/c with Deionizer
2 Miscellaneous
Sub Total III

IV
1
2
3
4
5
6

V
1

2
3
VI
1
2
3

VII

Flame Photometer
compressor for flame photometer
Glucometer
Hot Air Oven
Miscellaneous
Sub Total D

OPD
Respiratory function Inspection Analyzer
BP Apparatus
Stethoscopes
Rectal Thermometers
Spiro meter
Miscellaneous
SubTotal IV
Gastroenterology
GastroIntestinal Fibro scope with
optical device, Adaptor
& Cold Light Source
Colonoscopy
Miscellaneous
SubTotal V
Causality / Emergency
Ambu System ( Infant)
Ambu System ( Adult)
Miscellaneous
SubTotal VI

1
1
1
2
1

14000
4000
4500
10000
15000

14000
4000
4500
20000
15000
167500

4
2
2
lot

110000
15000
30000
15000

440000
30000
60000
15000
545000

1
1

350000
25000

350000
25000
375000

1
12
30
20
1
lot

90000
500
200
50
4500
30000

90000
6000
6000
1000
4500
30000
137500

1
1
1

600000
450000
35000

600000
450000
35000
1085000

4
4
1

6000
6000
10000

24000
24000
10000
58000

Monitoring
20

1
2
3
4
5
6
7
8

VIII
1
2
3
4
5
6
7
8
9
10
11

IX
1
2
3
4
5
6
7
8
9

X
1
2
3
4
5
6

ECG Machine
Cardiac Monitor
Multi Parameter Monitor
Central nursing Station
Defibrillator MonitorRecorder
Cardiac Pacemaker
Stress Test System, Tread Mill
Miscellaneous
SubTotal VII

6
15
8
2
2
2
2
lot

30000
45000
220000
330000
90000
30000
650000
30000

180000
675000
1760000
660000
180000
60000
1300000
30000
4845000

Ophthalmology
Ophthalmoscope
Lenso meter
Operating Microscope
Cataract Extractor
Trial case
Retinoscopy Set
Tonometer
Lees Screen
Opthalometer
Slit lamp
Opthalmic Instruments
SubTotal VIII

2
1
1
1
1
2
1
1
1
1
1

25000
7000
70000
3500
5100
1600
1400
8000
15500
200000
30000

50000
7000
70000
3500
5100
3200
1400
8000
15500
200000
30000
393700

Physiotherapy
Nerve & muscle Stimulator
Shortwave Diathermy ( Indian)
Microwave Therapy Unit
Ultrasonic Therapy (Indian)
Laser Therapy
Transcutaneous Nerve Stimulator
Static Cycle Exerciser
Jogger
Miscellaneous (Infrared lamps, pullies etc.)
SubTotal IX

1
1
1
1
1
1
1
1
1

5000
40000
125000
60000
140000
1300
4000
7000
10000

5000
40000
125000
60000
140000
1300
4000
7000
10000
392300

4
8
1
2
2
2

1200
800
8000
50000
3500
7500

4800
6400
8000
100000
7000
15000

Orthopaedics
Invalid Walker ( Adult)
Infant Walker ( Adult)
Paraffin Wax Bath( Arm, hand & foot)
Orthopaedics Instruments & Implants
Electric Bone Drill
Electric Bone Saw

21

7 Electric Plaster Saw

8 Fracture Table
9 Miscellaneous
SubTotal X
XI

3
2
lot

3000
8000
25000

9000
16000
25000
191200

1
1
1

55000
600000
3000

55000
600000
3000
685000

800000

800000

1
1
1
1
1
1
1

225000
850000
3500000
160000
20000
90480
20000

225000
850000
3500000
160000
20000
90480
20000
56,65480

Central Sterile Supply Depot

Portable Autoclave
High Pressure Cylindrical Steam Sterilizer
High speed cylindrical electrical Sterilizer
Disinfector
Miscellaneous
SubTotal XII

3
1
1
10
1

6000
100000
90000
9000
10000

18000
100000
90000
90000
10000
308000

OT ( ICCU)
Electro Surgical unit
Blood Gas Analyzer
Twin Bottle Electric Suction Apparatus
Major OT Lights
Medium Shadow less OT Lights
Mobile Shadow less OT Lights
Ventilator ( adult & Paediatric)
Ventilator
Anaesthesia Machine
Respirometer
Miscellaneous Instruments

.
4
2
2
4
2
6
2
4
4
6
lot

120000
950000
12000
65000
25000
12000
700000
90000
110000
25000
30000

480000
1900000
24000
260000
50000
72000
1400000
360000
440000
150000
30000

Gynaecology
1 Doppler Foetus Detector
2 Laparoscope with monitor & Camera
3 Miscellaneous
SubTotal XI

XII
1
2
3
4
4
5
6
7

XIII
1
2
3
4
5

XIV
1
2
3
4
5
6
7
8
9
10
11

Diagnostic imaging
Ultrasound scanner With high Resolution
Monitor
Mobile Xray Unit 100 MA
Xray Machine 500 MA
C.T. Scan Machine
Film Processor
Dark Room Equipment
SemiAutomatic Video Imager
Miscellaneous
SubTotal XII

22

SubTotal XIV
XV

ENT
1 Audio Meter
2 Miscellaneous Instruments
( auroscope, Tracheotomy sets etc.)
SubTotal XV

XVI

XVII

5166000

70000

140000

lot

120000

120000
260000

Mortuary
1 Mortuary Chambers
SubTotal XVI

120000

360000
360000

Wards
1 Respirable Air Pump
2 Wall Unit for Anaesthesia
SubTotal XVII

2
2

40000
20000

80000
40000
120000

250
40
20
4
10
240
5
25
4
20
10
10
50
250
80
25
70
200
100
6
8
40
4
100

1300
650
3300
1800
1800
500
1200
800
1400
1700
200
1700
200
200
500
200
600
300
25
4000
1000
60
1200
75

325000
26000
66000
7200
18000
120000
6000
20000
5600
34000
2000
17000
10000
50000
40000
5000
42000
60000
2500
24000
8000
2400
4800
7500

XVIII
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24

Hospital Furniture
Hospital's Cots
Attender's Cots
Fowler Position Cots
Cardiac Cots
Maternity Cots
Bedside Lockers
Gynec Examination tablets
Mayo Instrument Trolleys
Labor Tables
Dressing Trolleys
Oxygen Cylinder Trolleys
Wheel Chairs
Revolving Stools for Patients
Visitor Stools
Bed Side Screens
Back Rests
Writing tables
Chair With Arms
Waste Paper Bins
Central Tables for Doctors Duty Rooms
Notice Boards
Kidney Trays
Cardiac tables
Specimen Containers

23

25 Steel Cupboards

50

3500

175000

24

26
27
28
29
30
31
32
33
34
35
36
37
38
39
40
41
42
43
44
45
46
47
48
49
50
51
52
53
54
55
56
57
58
59
60
61

Storage Racks
Pigeon Hole Racks
Sofa Sets for Doctors Duty
Cot with Mattress for Duty Rooms
Step Stools
Benches for Patient Waiting Room
Bed pans with cover
Spitting Mugs
orthopedic tables
Surgical trays
Catheter Trays
Wash Basins
Jugs
Buckets
Saline Stands
Wash Basin Stands
Xrays view Boxes
Ice Caps
Instrument Trolleys
Weighing Machines (Adult)
Weighing Machines (Infant)
Thermometers
Hot Water Bottles
Kidney Trays
Examination Tables
Urinals / Pans
Stretchers on Trolleys
Paediatric Beds
Over bed Tables
Baby Cradles
Emergency Trolleys
Operation tables ( Major)
Surgical Table ( Minor)
ICU / CCU Beds
Air curtains
Miscellaneous
SubTotal XVIII
Grand Total ( Sub total I to XVIII)

40
8
6
10
40
40
80
80
4
40
40
50
40
40
40
50
15
30
30
4
4
100
100
30
10
70
16
15
150
15
4
4
2
16
10
lot

1200
350
4500
1200
300
500
300
60
7000
350
150
70
100
120
300
320
220
100
950
500
1800
30
120
60
4500
150
2500
1200
600
400
1500
90000
55000
11000
14000
50000

48000
2800
27000
12000
12000
20000
24000
4800
28000
14000
6000
3500
4000
4800
12000
16000
3300
3000
28500
2000
7200
3000
12000
1800
45000
10500
40000
18000
90000
6000
6000
360000
110000
176000
140000
50000
2429200
Rs. 235.70 Lakhs

25

Other Miscellaneous Fixed Assets

Cost of miscellaneous fixed assets includes telephone and fax, office equipment, site office furniture,
vehicles etc. A total of Rs. 170 Lakhs is earmarked for the purpose. The cost involved under various items
is given in Table below.
Other Miscellaneous Fixed Assets
Electrical & workshop equipments
Site office furniture and fixtures
Vehicles
Other assets
Total

Cost in Rs. Lakhs

80.00
30.00
20.00
40.00
170.00

Preliminary and Preoperative Expenses

Apart from the cost of the tangible assets described in earlier sections of this report provision has also
been made towards other categories of expenditure necessary for the establishment of the project.
These expenses are known as preliminary and pre operative expenses. The preliminary expenses
basically cover the expenses involved in company formation and project identification. They also include
capital issues expenses if the company is to be formed as a public limited company. The preoperative
expenses cover all other category of expenses that are incurred in the implementation of the project
starting from project identification to commissioning of the project. The preliminary and preoperative
expenses for this project are estimated as follows.

Sl
no
1
1
2
3

Description
Preliminary Expenses
Drafting charges payable to CA for drafting the memorandum and articles
of association of the company
Printing charges for memorandum and articles of association of the
company
Application fee payable to the Registrar of Companies for Registration of
the company assuming that the
Authorized capital of the company will be Rs. 452 Lakhs

Expenses (Rs. In
lakhs)

0.15
0.15

0.72
4
5
(i)
(ii)
(iii)
(iv)
(v)

Fees Paid to Consultants for project identification and evaluation ,

preparation of project profiles, conducting
market survey and preparing project feasibility studies
Capital Issue Expenses
Advertisement and Publicity
Printing and Postage
Underwriters commission and brokerage (4%)
Fees paid to Managers and registrars to the issue
Listing fees and other expenses
Total
Description
Salaries and Wages

0.94
4.11
4.11
8.22
4.11
4.11
26.62
3.20
26

2
3
4
5
6
7
8
9
10
11
12
13
14

Staff Welfare Expenses

Printing and Stationery Expenses
Rent, rates and Taxes
vehicle Expenses
Repair and Maintenance Expenses
Travelling and Conveyance Expenses
Auditor's Remuneration
Insurance Premium
Interest and Commitment Charges
Bank Charges and commission
Recruitment of Personnel
Legal and Professional Fees
Other Miscellaneous Expenses
Total
Total
Total

1.00
1.05
3.15
0.00
2.10

1.50
0.40

R
sLakhs
.
1
4
4
.
8
8

24.15
Rs.
Rs.144.88
144.88
Lakhs

Lakhs

27

Working Capital and Marginal Money

Estimates of Working Capital requirements have been worked out on the basis of following cycles of
expenditure involving cash liabilities and other recurring requirements.
Stock of Raw Materials in Stores
(i) Imported
(ii) Indigenous
Packing Materials
Work in Progress
Stock of Finished Goods in Stores
Accounts Receivable
Other Recurring Expenses
Electricity Deposits

0.0
0.5
0.5
0.05
0.5
0.1
1
Rs.35

Months
Months
Months
Months
Months
Months
Months
Lakhs

Work in progress covers the cost of Raw Materials, Utilities, Lob our and Staff Wages. The value of
finished goods for sale is arrived at by taking into consideration, the cost of raw materials, utilities, labor
and staff wages, administrative overheads, maintenance and repairs and insurance. Other recurring
expenses cover utilities, labor and staff wages, maintenance and repairs, insurance, administrative
overheads and sales expenses.
The requirements of margin money for working capital requirements are made on the basis of following
norms adopted by all nationalized banks in our country.
Margin on Raw Material in stores
Margin on Packing Material
Margin on Work in Progress
Margin on Finished Goods in
stores
Margin on Accounts Receivable
Margin on Other Recurring
Expenses
Margin on Electricity Deposit

20.00%
20.00%
30.00%
30.00%
20.00%
100.00%
100.00%

The requirement of total working capital, bank borrowings and margin money during the first, second,
third and subsequent years of plant operation are estimated in the following table.

28

Assessment of Working Capital & Margin Money Requirements

First Year

Description
Stock of Raw
Materials in Stores
(i) Imported
(ii) Indigenous
Packing Materials
Total 1+ 2
Work in Progress
Stock of Finished
Goods in Stores
Accounts
Receivable
Other Recurring
Expenses
Electricity
Deposits

Capacity Utilization
=
No. of
Margin
Mont
Money %
hs

0.00
0.50
0.50

20.00%
20.00%
20.00%

0.05

Description
Stock of Raw
Materials in Stores
(i) Imported
(ii) Indigenous
Packing Materials
Total 1+ 2
Work in Progress
Stock of Finished
Goods in Stores
Accounts
Receivable
Other Recurring
Expenses

Working
Capital

Margin
Money

Bank
Finance

30.00%

0.00
6.27
0.00
6.27
2.14

0.00
1.25
0.00
1.25
0.64

0.00
5.02
0.00
5.02
1.50

0.50

30.00%

23.46

7.04

16.42

0.10

20.00%

7.33

1.47

5.87

1.00

100.00%

36.58

36.58

0.00

100.00%
First Year

35.00
110.78

35.00
81.98

0.00
28.80

Total

Second Year

70%

Capacity Utilization
=
No. of
Margin
Mont
Money
%
hs

0.00
0.50
0.50

20.00%
20.00%
20.00%

0.05

75%
Working
Capital

Margin
Money

Bank
Finance

30.00%

0.00
6.72
0.00
6.72
2.22

0.00
1.34
0.00
1.34
0.66

0.00
5.38
0.00
5.38
1.55

0.50

30.00%

24.23

7.27

16.96

0.10

20.00%

7.86

1.57

6.29

1.00

100.00%

37.38

37.38

0.00
29

Electricity
Deposits
Total

Third Year

Description
Stock of Raw
Materials in Stores
(i) Imported
(ii) Indigenous
Packing Materials
Total 1+ 2
Work in Progress
Stock of Finished
Goods in Stores
Accounts
Receivable
Other Recurring
Expenses
Electricity
Deposits

100.00%
Second

Capacity Utilization
=
No. of
Mont
Margin
hs
Money %

0.00
0.50
0.50

0.20
0.20
0.20

0.05

35.00
113.40

35.00
83.23

0.00
30.17

75%
Working
Capital

Margin
Money

Bank
Finance

0.30

0.00
6.72
0.00
6.72
2.22

0.00
1.34
0.00
1.34
0.66

0.00
5.38
0.00
5.38
1.55

0.50

0.30

24.23

7.27

16.96

0.10

0.20

7.86

1.57

6.29

1.00

1.00

37.38

37.38

0.00

0.00
1.00
Total
Third Year

35.00
113.40

35.00
83.23

0.00
30.17

Manufacturing Inputs and Cost

Cost of Supplies and Consumables
For operating a 200 bed hospital at 100 % capacity utilization, the following consumables may be
required.
Total Amt. ( Rs.
Item
Numbers
Rate Rs.
Lakhs)
(I) Medical
A. Operation Theatre
Major Operation ( preparation Anaesthesia
&
Disposables)
0
Minor Operation (dressing Materials etc.)
B. Delivery Charges
Delivery Cases (Dressing Materials etc.)
C. Diagnostics

1500

1800.00

27.00

2000

600.00

12.00

2000

600.00

12.00

30

i Imaging
X ray ( xray films + Developing Materials)
Barium X ray ( x ray + Barium Metal
Ultra Sound ( Ultra sound +jelly)
C.T Scan (Dyes)
ii Pathology
Misc. Reagents & Chemicals
iii Cardiac Tests
ECG ( ECG paper & Jelly )
Stress Testing ( stress Test Paper & Jelly)
Cardiac Evaluation ( As for ECG, stress test
&
ultrasound)
iv Resp. Screening (Recording Paper)
D. Dialysis
Dialtser ( reusable), fluids etc.
E. Endoscopy
F. Physiotherapy ( wax etc.)
G. General Health Evaluation ( X ray, U
sound. ECG, Pathological tests, Resp.
Screening & stress test )
II Non Medical
A. Laundry
B. Kitchen ( For IPD patients)
C. Housekeeping supplies ( For OPD, IPD &
Admen. Block
Miscellaneous (Oxygen Cylinders etc.)
Total (in Rs.Lakhs)

30,000
1500
12000
6000

60.00
75.00
60.00
1000

18.00
1.13
7.20
40.00

2,50,000

12.00

30.00

12000
900
1800

12.00
30.00
85.00

1.44
0.27
1.53

1500

10.00

0.15

150
3000
6000
2400

900.00
50.00
30.00
300.00

1.33
1.50
1.80
7.20

150
150
700

3.00
80.00
275.00

1.64
43.80
1.93
5.07
215.00

Utilities
The main utilities required for the plant are water, fuel oil and electricity.
Water
The annual requirement of water at 100 % utilization capacity is estimated at 30,000 KL. Considering
a unit rate of Rs 3 per KL of water, the annual cost of water is estimated at Rs.9 Lakhs.
Diesel
Diesel is required for DG set. The annual requirement of Diesel at 100% capacity utilization is estimated
at 50.00 KL. Considering unit rate of Rs. 16,000 per KL of diesel, the annual cost of Diesel is estimated
at Rs. 8.00 lakhs.
Fuel oil
Fuel oil is required for steam generation. The annual requirement of fuel oil at 100 % capacity utilization
31

is estimated at 50.00 KL. Considering a unit rate of Rs 10000 per KL of fuel oil, the annual cost of fuel
oil at 100 % capacity is estimated to be Rs 5.00 Lakhs.
Electricity
The unit will need a total connected power load of 600 KW. The annual consumption of electricity at 100
% capacity utilization is estimated at 40 lakh units. Considering a unit rate of Rs 3.50 per KWh
of electricity, the annual cost of electricity at 100% utilization capacity is estimated at Rs. 140.00 Lakhs.
Annual Cost of Utilities is thus estimated as follows
Annual cost of coal

Rs 8.00

Lakhs

Annual cost of water

Rs. 90.0

Lakhs

Annual cost of electricity

Rs. 140.00 Lakhs

Annual cost of Fuel oil

Total

Rs. 5.00 Lakhs

Rs. 153.90 Lakhs

Manpower requirement
The requirements of personnel has been worked out by taking into consideration the anticipated work
load, degree of skill required and the productivity of the workers on similar Jobs. The plant is proposed
to be operated on single shift basis comprising of eight hours each on a 300 days working schedule in
a year.
Based upon the plant capacity and the number of machines, the total requirements of personnel
are estimated at 35 Nos. under different categories. Annual wage bill of the staff works out to be Rs.
18.00 Lakhs.
The details of manpower required are as under.
Designation

No.s

Monthly Salary
(in Rs)

Total Costs
(in Rs lakhs)

General Medicine
General Surgery
Obstetrics &
Gynaecology
Cardiology
Pathologist
Radiologist

3
3
3

12000
12000
12000

4.32
4.32
4.32

2
2
2

12000
12000
12000

2.88
2.88

Type
(I) Medical
Staff
Registrars

2.88

General Duty
Medical
Officers
32

Senior House Physician

Junior House Physician
Anaesthetist

8
8
8

9000
6000
6000

8.64
5.76
5.76

Ward master
Matron in chief
Deputy Matron

4
1
2

8000
6000
5000

3.84
.72
1.20

(II) Nursing
Staff

Operation Theatre Nurse

Labour Room Nurse
Sisters
Staff Nurses
Nurse Midwife

16
10
20
70
40

4000
4000
4000
4000
3000

Cardiac Centre
Technician
Dialysis technician
Pharmacist / Astt.
Pharmacist
Steward / Dietician

5000

2
2

5000
5000

5000

ECG
Imaging
Clinical pathology
Blood Bank
Laundry
CSSD
Ophthalmology
Stress Test
Dark Room
Physiotherapist
Endoscope Technician

4
6
7
4
4
4
1
1
3
1
1

5000
5000
5000
5000
5000
5000
5000
5000
5000
5000
5000
5000

7.68
4.80
9.60
33.60
14.40

(III)
Paramedical
Staff
1.20
1.20
1.20
1.20

Technologist /
technician

Orthopaedics

2.40
3.60
4.20
2.40
2.40
2.40
.60
.60
1.80
.60
.60
1.20

(IV) Non
Medical staff
Engineering
Staff
33

Electrician
Mechanical Plumbing

4
4

3500
3500

1.68
1.68

Medical Supdt.
General Administrator
Personnel Officer
Finance Officer

1
1
1
1

20000
10000
8000
8000

2.40
1.20
.96
.96

(V)
Administrative
& Allied Staff

(VI)
Compute
r Division

Accounts officer
Cashier
LDC/ Typist/
stenographer
Record Clerk
House Keepers
Materials Officer
Telephone Operators
Driver
Attendant / Nursing/
Orderly
Guards / Security
Attendants
Security Officer
Junior Housekeeping staff

1
1

Computer operators

Total
Other Benefits
Total salaries per annum i

1
0
2
6
4
4
4
1
0
1
6
1
2
0

345

8000
5000
2500
2500
2000
3000
3000
2500
2000
2000
6000
2000

6000

.96
.60
3.00
.60
1.44
1.44
1.44
1.20
2.40
3.84
.72
4.80

4.32
Rs 180.84 Lakhs
74.16
Rs 255.00 Lakhs

Administrative Overheads
Administrative overheads include administrative and office expenses such as staff travelling,
office stationery and postage, telephone bills, audit fee, legal fee, bank charges and other sundry
expenses.
Details
Amount in Rs. Lakhs
Rent, rates & taxes
3.50
Travelling and Conveyance
2.25
Vehicle expenses
4.00
Bank charges, Guarantee, commissions etc
1.23
Post , Telephone and Fax charges
1.50
Advertisement & Publicity
8.50
34

Office supply & stationary

Auditors fee and expenses
Legal & Professional expenses
Directors sitting fees and expenses
Misc. Expenses
Total

0.80
0.12
0.60
0.12
3.39
26.01

Maintenance and Repairs

On the basis of norms available from similar hospitals in actual operation, provision has been made
for annual cost of maintenance and repairs. The maintenance and repair expenses are estimated at
1% of the cost of building and structure and 2% of the erected cost of machinery and other
miscellaneous fixed assets. The cost of Maintenance and repairs is estimated as under:
Type

Repair and Maintenance Cost in Rs. Lakhs

Maintenance of building and structures @ 1% on Rs

855.50 Lakhs
Maintenance of machinery @ 2% on Rs. 235.70
lakhs
Maintenance of other miscellaneous fixed assets @
2% on Rs. 170.00 Lakhs
Total

8.555
4.71
3.40
Rs. 16.67 Lakhs

Insurance
The building and structures, plant and machinery and other miscellaneous fixes assets of the unit will
be insured against all types of risks. It is estimated at 0.6% on Rs. 1231.20 Lakhs which works out to
be Rs.
7.39 lakhs.
Sales Expenses
The sales expenses generally cover commission, brokerage, discount etc. the annual sales expenses
at 100 % capacity utilization are estimated at 3% of the annual sales revenue of 1257.00 Lakhs,
which comes out to be as Rs. 37.71 Lakhs Annually.
Financial Expenses (interest on short term loan and long term loan)
A. Interest on Short Term Loan
To partially meet the working capital requirements of the project, the company will have to
make arrangements for cash facilities credit facilities with a nationalised bank. The present rate of
interest taken here is 16 % for short term loans.
The following table gives the requirements of short term loans and anticipated interests payable to
the bank during the first 10 years of its operations.
Interest on Short Term Loans
Unit Rs. Lakhs
Serial No
Year Of Operation
Bank Borrowings
Interest Payable
1

First

28.80

4.61
35

Second

30.17

4.83

Third & subsequent years

30.17

4.83

B Interest on Long Term Loans

It is proposed to raise the sum of Rs. 1150 Lakhs as long term loans from financial institutions to
meet the capital cost of the project. For calculating the interest on long term loans, an interest rate
of 13 % is taken into consideration in this report.
The principal will be repaid in 17 half yearly instalments. The first instalment of Rs. 50.00 lakhs will
be paid at the end of completion of second year of the working of the unit and balance 16 half
yearly instalments of Rs. 50.00 lakhs each will be payable at half yearly intervals from the date of
payment of first instalment. The following table gives detail of interest payable on long term loans
during the first 10 years of operation of plant.
Interest on long term loans ( Rs. Lakhs)
S.N.
1
2
3
4
5
6
7
8
9
10

Year
First
Second
Third
Fourth
Fifth
Sixth
Seventh
Eighth
Ninth
Tenth

Interest
149.50
149.50
139.75
126.75
113.75
100.75
87.75
74.75
61.75
0.00

Appendix and Tabulations

Working Results and Profitability
The annual cost of sales is developed from all cost and expenses incurred in the running of Hospital
(200 Bed), maintenance of the plant and sales of the finished product. The annual cost of sales
during the first 10 years of plant operation is estimated in the following table.
Description
Year1
Year2
Year3
Year4
Year5
Cost
Hospital Occupancy
70%
75%
75%
75%
75%
Variable Costs
Raw Material
215.00
150.50
161.25 161.25
161.25 161.25
Utilities
153.90
107.73
115.43 115.43
115.43 115.43
Packing Materials
0.00
0.00
0.00
0.00
0.00
0.00
Sales Expenses
37.71
26.40
28.28
28.28
28.28
28.28
Interest on Bank
As Per
Borrowing
Limit
4.61
4.83
4.83
4.83
4.83
Total
289.24
309.78 309.78
309.78 309.78
Fixed Costs
Labour & Staff Wages
255.05
255.05
255.05 255.05
255.05 255.05
Repair & Maintenance
16.37
16.37
16.37
16.37
16.37
16.37

Year6
75%
161.25
115.43
0.00
28.28
4.83
309.78
255.05
16.37
36

Insurance
Admin. Overheads
Interest on Long Term
Depreciation

7.39
26.01
As Per
Limit
75.09
Total
Annual
Cost

7.39
26.01

7.39
26.01

7.39
26.01

7.39
26.01

7.39
26.01

7.39
26.01

149.50
75.09
529.41

149.50
75.09
529.41

139.75
75.09
519.66

126.75
75.09
506.66

113.75
75.09
493.66

100.75
75.09
480.66

818.65
790.45

839.20

829.45

816.45

803.45

Sales Revenues
The Annual sales revenue at 100 % occupancy
Sl

Facility

Nos

Rate( in Rs)

1
2
3

Registration (IPD+OPD)
Consultation
Nursing home ( room
charge)
Regal suit
Single ( deluxe)
Single
Double

60000
80000

30
80

Total Revenue (Rs.

In
lakh)(365 days)
18.00
64.00

4
10
34
40

1700
1200
1000
680

24.82
43.80
124.10
99.28

Triple
Ward ( 6 bedded)
ICU/CCU
Neo Natal care
Emergency beds
Operation theatre
Major Operation( 3 per
day)
Minor operation ( 6 per
day)
Diagnostics
a. Imaging
Xray ( 80 plates per day)
Barium Xray ( 7 plates per
day)
Ultra
Sound
(
20
patients/day)
CT Scan ( 10 patients /day)

30
36
16
20
10

450
225
1100
900
225

49.28
29.59
64.24
65.70
8.21

1095

2500

27.38

2190

1100

24.09

2400
2100

150
250

36.00
5.25

6000

450

27.00

3000

5000

150.00

37

5
6
7
8
9

10
11
12

b.
Pathology
(500
150000
150
routines/day)
c. Cardiac Tests
ECG (20 patients/day)
6000
150
Stress
testing
(
6
1800
1300
patients/day)
1800
1900
Cardiac Evaluation (6
test/day)
d. Resp. screening 10
3000
150
screen/day
300
3000
Dialysis ( 2 patients/day)
Endoscopy
9
3
900
650
patients/day) Physiotherapy
(
50
15000
150
patients/day)
3000
1600
Gen.
Evaluation
(10
patients/day)
Chamber Ch ( monthly
30
300
charges from out side
doctors) Kitchen
(IPD)
150
150
Ambulance ( 10 trips/day)
3700
110
Revenue from chemist
Lot
60000
shop ( including of lease
rental and commission on sale)
Sales Revenue ( rs. In lakhs)
: Rs. 1380.00
Less @ 10% of 1230 lakhs
Revenue from CT scan
Total sales Reveneu

225.00

9.00
23.40
34.20
4.50
9.00
5.85
22.50
48.00
1.08

82.10
4.07
7.20

: Rs
: Rs
: Rs

1107.00
150.00
1257.00

Year1
70%
879.90
818.65
61.25

Year2
75%
942.75
839.20
103.55

Year3
75%
942.75
829.45
113.30

Year4
75%
942.75
816.45
126.30

Year5
75%
942.75
803.45
139.30

Year6
75%
942.75
790.45
152.30

149.50
4.61
154.11
2.66
75.09
58.59

149.50
4.83
154.33
2.66
75.09
100.89

139.75
4.83
144.58
2.66
75.09
110.64

126.75
4.83
131.58
2.66
75.09
123.64

113.75
4.83
118.58
2.66
75.09
136.64

100.75
4.83
105.58
2.66
75.09
149.64

Estimation of Working Results (Rs Lakhs)

Description
Plant Efficiency
Sales Revenue
Cost of Production
Profit after depreciation
Financial Expenses
Interest on term Loan
Interest on working Capital
Sub Total
Writing off of Pre Expenses
Depreciation
Net Profit Before Tax

38

Income Tax
Retained Earnings/profit after tax
Depreciation Written back
Net Cash Accruals
Cash Profit
Reserves & Surplus

22.71
81.30
75.09
156.40
159.06
81.30

0.94
99.95
75.09
175.04
177.71
181.26

12.56
98.09
75.09
173.18
175.84
279.34

23.42
100.22
75.09
175.31
177.97
379.56

32.95
103.70
75.09
178.79
181.45
483.26

41.42
108.22
75.09
183.31
185.97
524.68

Pay Back Period

Payback period is defined as the no. of months or year required for the unit to generate cumulative
gross operating surplus equal to the fixed capital investment in the project.
Pay Back Period of the unit is estimated in the following table
Pay Back Period
Description
Nett Profit Before Taxes
Depreciation
Interest on LET. Loans
Gross Operating Surplus
Cum. Gross Operating Surplus
Return of Equity
Return of Investment

Year1
58.59
75.09
149.50
283.18
283.18
11.72%
17.16%

Year2
100.89
75.09
149.50
325.48
608.67
20.18%
19.73%
0.368889

Year3
110.64
75.09
146.25
331.98
940.65
22.13%
20.12%
0.570091

Year4
123.64
75.09
133.25
331.98
1,272.64
24.73%
20.12%
0.771294

Year5
136.64
75.09
120.25
331.98
1,604.62
27.33%
20.12%
0.9724958

Break Even Point Efficiency

The breakeven point analysis of the plant is developed from the assumed plant efficiency, fixed
cost of sales, variable cost of sales, and sales revenues
Break Even Point Efficiency for the proposed project is given below:
Break Even Point Efficiency
Description
Plant Efficiency
Fixed Cost of sales
Fixed Cost of sales Depreciation
Sales Revenue
Variable cost of sales
Cash Break Even Point
Breakeven efficiency

Year1 Year2 Year3 Year4 Year5

70.00
75.00
75.00
75.00
75.00
529.41 529.41 519.66 506.66 493.66
454.32 454.32 444.57 431.57 418.57
879.90 942.75 942.75 942.75 942.75
289.24 309.78 309.78 309.78 309.78
76.92% 71.78% 70.24% 68.18% 66.13%
62.74
62.73
61.57
60.03
58.49

Average Break Even Point Efficiency over 5 Years = 61.11%

39