1

TABLE OF CONTENTS

Summary:

1. Name and Location of Project 01

2. The Project 01
3. Capacity 01
4. The Proposal 02
5. Land 02
6. Building & Other Civil Work 02
7. Imported Machinery 02
8. Local Machinery 03
9. Cost of the Project 03
10. Means of Finance 04
11. Investment-Equity Ratio 04
12. Investment-Service Coverage Ratio 04
13. Fixed Assets Coverage Ratio 04
14. Break Even Point 04
15. Financial Rate of Return 04

Management Aspects:

1. Introduction 05
2. Directors of the Project 05
3. Management & Organization 09

Technical Aspects:

1. Purpose of the Project 10

2. Capacity
3. Selection of Technology 11
4. Project Consultant 11
5. Plant Description
6. Land and Location 12
5. Building and Other Civil Works
6. Imported Machinery 12
7. Local Machinery 14
8. Utilities
14
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Market Aspects:

01. Review of Bangladesh Power Sector 16

02, Review of Bangladesh Gas Sector 17

3. Contribution of Power in the Country's GDP 22

4. Generating Capacity of Electricity 23
5. Action Plan of the Government 24
6. Future Action Plan for Restructure 25
7. Socio-Economic Impact of the Project 25
8. Risk Factors and Mitigation Approaches 27
9. Project Revenue 28
Financial Aspects:

1. Cost of the Project 30

2. Means of Finance 31
3. Equity Capital 31
4. Debt-Equity Ratio 31
5. Fixed Assets Coverage Ratio 32
6. Financial Evaluation 32
7. Debt-Service Coverage Ratio 35
8. Break Even Analysis 35
9. Financial Rate of Return 35
10. Fund Flow Statement 35
11. Projected Balance Sheet 35

Annexure:
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1. Fixed Cost of the Project 36

2. Building and Other Civil Works 39
3. Machinery & Equipment
4. List of Furniture & Fixture 40
5 . projected Construction Time 42
6 . 07. Forecast of Earning
Estimates of Financial 43
Expenses 44
15. Break Even Analysis
16. Projected Cash Flow Statement
17. Projected Balance Sheet 48
18. Internal Rate of Return
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03. The Project:

Bangladesh is presently facing shortage of power. Although the present government has
miracle developed in power sector. But some parts of the country out of electricity. This is
threatening to the agriculture, industry, commerce as well as the whole economy.
Uninterrupted electricity supply can help in achieving socio-economic development
through expanding opportunity of employments and industrialization. Mentionable here
that, the power sector of Bangladesh based on fuel i.e. diesel, Gas, coal. So it is very costly.
Kaptai Hydro-electric power plant based on natural water but it was threatening for
environment. In Bangladesh firstly we are going to generate hydro-electric power pant
without river or pond or canel. Our hydro-electric power plant's capacity is 5 MW. We
optimistic the government people's Republic of Bangladesh will purchase 5 MW from us.
The main machinery of the project has been proposed to be imported from China & India .
The fixed cost of the project has been estimated at Tk.200.00 million. Details of fixed cost
may be seen in Annexure- I.

4. Product Mix and Capacity:

The annual rated production capacity of the project has been assumed to be 5 MW power.

5. The Proposal:

Proposal to the Bank for term Investment amounting to Tk.120.00 million being the
60% of the total cost of the project.

6. Land:

The project has been proposed to be located in a plot of land at Ullapara,

Sirajgonj. The area of land is 100 decimal. The land has been purchased in the
name of Md. Shasul Alam managing director of the company. The present
market price of land has been estimated at Tk.20.00 million @Tk.2.00 lac
per decimal, The land requires to be developed and an amount of Tk.50.00 lac
has been estimated for land development. The site is accessible through the
Dhaka-Rajshahi Highway. All infrastructural facilities like water, power,
Fuel, gas, labour, communication etc. are available at the project site.

7. Building and Other Civil Works:

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The project will be housed in a constructed building on the above land.

There will be plant building, office, water house, Ware house, rest house,
etc. The total cost of building and other civil works has been estimated
at Tk. 50.00 million.

8. Imported Machinery:
The project has been proposed to be equipped with both imported and local
machinery. The machinery of the project will be imported from China.

The total C&F price of the imported machinery including the cost of
installation stands at Tk.50.00 million

9. Local Machinery:

In addition to the imported machinery, the project will also procure a few
machinery namely Air Compressor, Deep Tube well with Pump & Motor, etc.
from local source at Tk. 50.00 lac

10. Cost of the Project:

The total cost of the project has bee n estimated at Tk. 200.00 million cost of
the project and means of finance are as follows:
(Tk. in '000')

Incurred To be Incurred T
F/C L/C o

/Land 47325 0 20000 67325

Building and other civil works 0 0 55200 55200
imported Machinery 0 1870400 196392 2066792
-Local Machinery 0 0 2290 2290
Utility Cost 0 0 80000 80000
Vehicles 0 0 12300 12300
Furniture, Fixture & 0 0 S2000 2000
Equipment 0 0 )3500 3500
Consultant's fee 0 0 4500 4500
Pre-operating expenses 0 0 137553 137553
Profit During Construction
Total cost of the project 47325 1870400 513735 2431460
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11 . M ea ns of Fina nc e :
(Tk. in ‘000’)

Item Bank Sponsors Total

Land 0 67325 67325
Building and other civil works 38640 16560 55200
Imported Machinery 1870400 196392 2066792
Local Machinery 0 2290 2290
Utility Cost 36128 43872 80000
Vehicles 0 12300 12300
Furniture, Fixture & Equipment 0 2000 2000
Consultant’s Fee 0 3500 3500
Pre-operating expenses 0 4500 4500
Profit During Construction 137553 0 137553
Total 2082721 348739 2431460

12. Investment-Equity Ratio:

Without profit DCP - 60: 20.
With profit DCP - 86: 14.
1.Investment-service coverage ratio:
The investment-service coverage ratio of the project works out to
1.92,1.10,1.16,1.23,1.31,1.41,1.52,1.65,1.82, & 2.03 times during the first
ten years of projected operation of the project.

2.Fixed Assets Coverage Ratio :

The fixed assets coverage to long term investment works out to 1.17 times
on completion of the project.

3.Break-Even Point:
The project is expected to break-even at 22.39% of the proposed capacity
utilization with sales volume of Tk. 3052.80 lac.

4.Fina nc ia l La te of :

The project promises a financial rate of return about 23.56% if it is completed

on schedule.

Management Aspects
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a sister concern of is recognized as one of the leading industrial & business conglomerate
in Bangladesh in Textile and Spinning Sector . With the support of a highly skilled
management structure and dedicated professionals, Youth has achieved a degree of success
that is unparalleled in the country's business history.

Directors of the Prolect and their Share holdings:

The project has been proposed to be promoted by the company of Shames Hydro-Electric
power plant.. Details of the Directors/Shares holders are detailed below:

Address Status Share

186/6 F. M. Tower, Mohammadpur, Dhaka Chairman 15000
186/6 F. M. Tower, Mohammadpur, Dhaka Managing Director 65000
186/6 F. M. Tower, Mohammadpur, Dhaka Director 10000
186/6 F. M. Tower, Mohammadpur, Dhaka Director 10000

Particulars of the Directors;

Md. Shamsul Alam, aged 50, the proposed Managing Director of the company is only
SSC passed but he is a big technician in hydro electric power plant. After completion of
SSC degree he went in KSA and working at hydro-electric power plant. In KSA he
made a Hydro-electric power plant under guidance of Saudian business man. The said
power plant run & power generated by him since 2006. Md. Shamsul Alam come back
Bangladesh in 2014 & started hydro-electric power plant. The civil works of the power
station approximate 90% completed. Mentionable here that, he is successful
businessman in abroad.

He travelled Jarden, Syria, Egypt, UAE, Kawyet, Bahrain etc. for business and
other purposes. He is a qualified, resourceful and experienced businessman in power
sector. He has 14 years experienced in power sector. It is expected that he will
make positive contribution to the project both in the implementation and
operational stages.

Management and Organization:

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The over all management of the company would be vested with its board of Directors.
Moreover, the Managing director will be the chief Executive to dictate and supervise the
over all functions and day to day operational performance of the company. In most cases,
his decision would be final and supreme. However, for uninterrupted operational speed of
the company, the Managing Director would seek advice, valued comments and guidance
from the Director. In addition, advice and consultancy services may also be sought from
among the experienced service holders of various disciplines to be recruited for smooth
operation of the project.

Technical Aspects

Background of the Project:

Bangladesh is presently facing shortage of power. Although the present government has
miracle developed in power sector. But some parts of the country out of electricity. This
is threatening to the agriculture, industry, commerce as well as the whole economy.
Uninterrupted electricity supply can help in achieving socio-economic development
through expanding opportunity of employments and industrialization. Mentionable here
that, the power sector of Bangladesh based on fuel i.e. diesel, Gas, coal. So it is very
costly. Kaptai Hydro-electric power plant based on natural water but it was threatening
for environment. In Bangladesh firstly we are going to generate hydro-electric power
pant without river or pond or canel. Our hydro-electric power plant's capacity is 5 MW.
We optimistic the government people's Republic of Bangladesh will purchase 5 MW
from us. The main machinery of the project has been proposed to be imported from
China & India . Basic features of the project can be summarized as follows:
a) Capacity 5 MW
b)
c) Technology Hydro Electric power plant but not based
on river or pond or canel.
d) Completion Time 150 days
e) Tariff Structure 4 part Tariff
f) Payment Local Currency (BDT)
g) Tax & Duties To be Paid by the Sponsors
h) Tendering Process Without any tender because there is no
any power plant as same all over the country

i) Bidder's Qualification N/A

Production capacity:
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The annual rated production capacity of the project has been assumed to be 5 MW power.

Selection of Technology and Equipment:

The managing director of the company is self consultant and efficient in hydro-electric
power sector. Some other technician are helping with him. The Sponsors, Consultant and
technician decided to implement the project using natural mineral water.

The consultant has been exploiting their experience, business contacts and reputation in
the global power generation market to find out the best suitable options (technology and
equipment new)/old/used/refurbished turbine/combined cycle/steam turbine, etc) to
implement the project with the selected technology in the most optimum way considering
the project engineering technical requirements and very short implementation time frame.
This part is the most critical for the project as old and used machinery is the most suitable
option which needs to be capitalized wisely. Mentionable here that, the managing director
of the company was consultant of hydro-electric power plant in KSA. The sponsors with
the Consultant visited a few combined cycle power generation facilities in KSA and
initially selected a plant of 5 MW at ISO conditions.

Project Consultant:
The managing director of the company is a good consultant in hydro-electric power
plant. So there is no need outsider consultant.

Proposed Plant Description:

The plant shall be implemented with a Combined Cycle Gas Turbine (CCGT)
technology consisting of 2 x gas Turbines, 2 X Heat Recovery Steam
Generators and 1 X Steam Turbine, i.e. a 2+2+1 configuration. GE designed heavy duty
Gas Turbines manufactured by ALSTOM, France shall be used in the project. The
exhaust gases from the GTs shall be passed through the two HRSGs to produce
superheated steam of adequate pressure and temperature to run the Steam Turbine.
Other than these major power-block equipments, the plant will also consist of
Balance of plant (BOP) equipments like gas compressor units, water treatment
plant, cooling tower for steam condensation, step-up transformers, 132 KV air
insulated switchyard, auxiliary power distribution systems, etc. There will be
central control room in the power station to monitor and control the station and to
communicate with the Load Dispatch Center to operate the plant according to national
grid requirements.

Electric Interconnection Facilities:

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Electrical energy to be produced by the plant shall be delivered to the 132 KV National
Grids, to Baghabari-Sirajgonj-Ruppur 132 KV Double Circuit Transmission line to be
specific, through the adjacent BPDB Grid Sub-station. All the required transmission and
interconnection facilities shall be constructed, operated and maintained by the project
sponsors.

Raw Water Supply:

Natural mineral water is main source of the project. The mineral water will be stored &
recycle. There is no access to river or other natural source of ample water around the site.
Raw water for plant cooling process and HRSG make-up, domestic and other usage has to
be collected using deep tube well. The available underground water quality shall be tested
and adequate treatment facilities shall be installed to meet the requirements.

Land:

The project has been proposed to be located in a plot of land at Ullapara, Sirajgonj. The
area of land is 100 decimal. The land has been purchased in the name of of the Md.
Shamsul Alam. The present market price of land has been estimated at Tk. 20.00 million
@Tk. 2.00 lac per decimal. The project land already developed 70%. The rest land requires
to be developed and an amount of Tk. 5.00 million has been estimated for land
development. The site is accessible through the Dhaka-Rajshhi Highway.All infrastructural
facilities like water, power, Fuel, gas, labour, communication etc. are available at the
project site.

Building and Other Civil Works:

The project will be housed in a constructed building on the above land. There will be plant
building, office, dormitory, Ware house, family quarter, rest house, etc. The total cost of
building and other civil works has been estimated at Tk.5.00 million. Details of building
and other civil works has been shown in Annex - II.

Imported Machinery:

The project has been proposed to be equipped with both imported and local machinery. The
machinery of the project will be imported from China & India. The total C&F price of the
imported machinery including the cost of installation stands at US$ 0.20 million equivalent
to Tk.16.60 million Details of the machinery to be imported has been shown in Annex -
III/A.
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Local Machinery;

In addition to the imported machinery, the project will also procure a few machinery
namely Air Compressor, Deep Tube well with Pump & Motor, etc. from local source at Tk.
5.00 million. Details of local machinery have been shown in Annex - III/B.

Water:

Mineral water is main sour of the project. Mineral water will be stored in house after then
recycling for power generating. The required water will be available from deep tube well to
be stored and others purpose using at the project.

Transport:

The project will have one Pick Up Van, one Truck, one Micro bus and one car. The cost of
vehicles has been estimated at Tk. lac.

Other Assets:

The project will purchase office furniture, fixture, telephone, fax, computer, air cooler, etc
for which an amount of Tk. 20.00 lac will be invested, details of which has been shown in
Annex - III/C.

Safety Provision:

To fight against fire, necessary fire fighting equipment and first aid box will be required.
Cost of fire fighting system has been considered with imported machinery.

Pollution Control and Waste Disposal :

The project does not pose any pollution or any harmful waste disposal,

Market Aspects

01. Review Bangladesh Power Sector:

The present government of Bangladesh is trying to best to development of power sector. In

a result day by day increasing electricity by implementation new power plant. Within 2021
Bangladesh will be self sufficient by the grace of Allah. The proposed power plant want to
work as join forces to implementation vision 2021. Government has implemented the
Private Power Policy in 1996 to encourage foreign investment and private entrepreneurship
development in this sector. Under this policy, in 1999-2002 period about 1250 MW
capacity of IPPs came into operation which are presently contributing more than 30% of
the total power generation of the country.
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Government has made Power System Master Plan (PSMP) 1995 which focused on the
twenty (20) years planning horizon, made projection of energy generation from 1996
through 2015, identified the sites for new generation capacities taking into consideration
the availability of fuel and evacuation facilities, high voltage transmission requirements and
made estimates of new investment in the generation, transmission and distribution. The
PSMP was again updated in 2005 by Nexant Inc. for the next 20 years planning horizon
under a technical assistance project of the Asian Development Bank. The PSMP 2005, like
the PSMP 1995, studied the existing power system, made forecasts of energy demand and
peak generation based on three different GDP growth projections, made financial analysis
to identify the least cost generation, identified new project sites giving consideration to
availability of local and imported fuels and the transmission lines and forecast investment
requirements over the planning horizon.

During the last twelve years, a total of 2000 MW new capacity was added to
the national grid-more than sixty (60) percent of which has come from the. IPP
projects set up under the Private Sector Power Generation Policy 1996 and the
rest in the public sector through use of own resources and Russian and
Chinese supplier's credits. But the Russian and Chinese Supplier's Credit
power generation facilities has been found unreliable and poor in thermal
efficiency. On the other hand growth of power demand continued and old
government owned plants suffering de rating due to various problems. As a
result, Bangladesh is reeling under a severe electricity crisis.
The year 2006-2007 witnessed large scale load shedding in the summer
months - primarily blamed for poor availability of the generating plants
owned by BPDB and to some extent rationing of gas supply and shortage of
generation capacity. Even though 250MW (2x125 MW) coal fired plant has
been added by the first quarter of 2006 and an additional capacity of 70 MW
from conversion of 4 simple cycle units of RPCL into combined cycle in 2007,
no more big capacity addition is expected in 2007-2008 and load shedding in
the summer months have been even widen to 1200 MW over these year. In
these circumstances the present caretaker government has undertaken a crash
program to add about 900 MW power to the grid by 2008 and set the year
2010 to resolve the problem with sufficient power generation. Following to
this plan about 200 MW of small Power Project (SPP) is already been awarded
to local sponsors under the IPP policy and some more projects are on the way
to be awarded on Rental basis and three more large IPPs are on the way to be
through for international bidding soon.
If these SPPs and Rental plants are implemented successfully, total generation
can be augmented by another 900 MW by the end of 2008 h h could
significantly reduce the gap between demand and supply.
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Over the last 10 years, consumption of electricity in Bangladesh has grown at a

compound annual rate of 8.10% and it Is expected that demand for electricity
will grow at an annual rate of about 8.0% for the nest 10 years. The AFB--funded power
system master plan update projected that a total capacity expansion of 17,900 MW
would be necessary through 2005, of which 3,500 MW would be needed by 2010.
The forecast met peak generation was 4,342 MW by 2005, 6403 MW by 2010 and
9,357 MW by 2015. The actual peak net generation is close to 3,800 MW with about
1200 MW load shedding in the peak hours. With this capacity only about 40% of the
population has access to power and rest of the population still in need of electricity.
So, to overcome this situation is going to be even bigger challenge for the government
in near future.

02. Review of Bangladesh Gas Sector :

The natural gas sector consists of the Bangladesh Oil, Gas and Mineral Corporation
(Petro Bangla), and its 11 subsidiary operating companies. Petro Bangla is mandated to
carry out oil and natural gas exploration and the production and marketing of gas.
Natural gas accounts for almost 70% of Bangladesh's commercial energy and provides
the basis for about 90% of electricity generation.

Bangladesh's only indigenous sources of commercial fuel are natural gas, the dominant
source of energy, which accounts for 70% of all commercial energy supply and recently
discovered coal, for which a draft revised policy is under consideration. Gas production
grew by almost 50.80% between 1999/2000 and 2006/2007, driven mainly by the
power and fertilizer sector; gas
consumption in major industries (e.g. textiles, dyeing, paper, pulp, ce en the commercial
sector and as domestic fuel is also increasing.

The current proven and probable reserve and recoverable reserve of as are 28.418 trillion
cubic feet (TCF) and 20.510 TCF respectively, of which cumulative production was 6.119
trillion up to August 31, 2005 and the balance recoverable reserve was 14.391 TCF. As of
November 2005, gas is being produced at 64 wells of 47 belonging to Petrobangla
companies and 17 gas fields to IOC's.

in 2004/2005, subsidiaries of the state petroleum company, Petrobangla, supplied about

73% (70% at the time of previous TPR) of Bangladesh's commercial gas consumption; the
remainder was produced and delivered to Petrobangla by international oil companies. Gas
supply goes mainly to power generation and fertilizer production, and to a lesser extent for
industry and commercial use. Tariffs, set by the Government for different uses of gas, were
most recently revised in January 2005. The rates are Tk. 73.91 per Thousand Standard
Cubic Feet (MSCF) for power generation, Tk. 63.41 per MSCF for fertilizer, Tk. 148.13
per MSCF for industry, and Tk. 233.12 per MSCF for commercial use.
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At present, shortage of gas supply is considered to be a serious bottleneck to growth, and is

being addressed by projects financed by the World bank and the Asian Development Bank
through the Gas Sector Development Strategy and Gas Sector Development Programme.
The formulation of a Gas act is in its final stages.

Jalalabad Gas Transmission & Distribution System Ltd. (JGTDSL):

Jalalabad Gas Transmission & Distribution System Ltd. (IGTDSL) will be responsible for
supplying gas to the power plant for the term, of GSA. jGTDSL supplies gas to the
customers in its franchise area consisting of the greater Sylhet District. The company
currently has a network of 2590.91 km pipeline, including 383 km transmission and
1151.26 km distribution lines. At the end of the year 2005-2006, jGTDSL has a customer
base of 98965 including 3 powers and 1 fertilizer plant. Gas sales by jGTDSL during the
year totaled about 24.65 BCF, the major consumer being power plants, accounting for
about 11.64 BCF.

The more reserve are expected to be added with increased exploration activities by BAPEX
(Owned by Petrobangla) and the 10Cs. Additional production capacity of 200 mmscfd has
been added in 2007 when Chevron started producing gas from its Bibiyana gas field. The
fullest capacity of this gas field (500 mmscfd) will be achievable by the year 2008. The
current share of lOC's production is little above 30%. This share is going to rise to 50%
when Bibiyana gas filed will go into full production by the year 2008.

The near term gas demand projection of Petrobangla shows that overall demand will
increase to 2006 mmscfd by the year 2008-2009 of which the share of power sector will be
1024 mmscfd or 51% in near term, gas will remain the prime fuel for power generation.
This share could be reduced if power generation from local coal is planned now and such
coal fired plants come into operation by the year 2010-2011.

As it appears from various projections of gas consumption including the latest projection
made in the Bangladesh Gas Sector Master Plan 2005 by Wood Mackezie, the country will
have to shift from gas to coal based power generation with share up to 50% by the next 20
years, unless large gas reserve are added in next 5 to 10 years.

On the transportation side, GTCL has completed the 30 inch, 28 km Rashidpur-I-fabiganj

segmentr of Rashidpur-Ashuganj loop line project and the capacity added by this line is
being used to transport the gas production from the Chevron's Moulivibazar gas fields
commissioned in early 2005. Uncoal is laying a new 30 inch, 25 Km Bibiyana-Rashidpur
line for delivery of its production from Bibiyana gas field to main transmission lines at
Rashidpur. To augment gas flow through the existing transmission lines, wood Mackenzie,
in its draft report on Bangladesh Gas Sector Master Plan dated November 2005
15

recommended for installation of gas compression stations at different points of the gas grid.
It is fairly expected to have sufficient gas supply and good gas pressure in the Shahjibazar
area due to close geographical location to various gas wells and connection to the National
Grid.

03. Contribution of Power Sector in the Country's GDP and the Annual Growth. Rate

of Power Sector:

Electricity is the key factor for country's development. The demand for electricity in
industry, agriculture, service sector as well as in the daily life of the people is enormous.
The demand for electricity has been increasing rapidly in the income generating sector like
agriculture, small Scale industries, etc., due to increased use of electricity at village level.
As such, the rural people have been able to cross poverty line consequent upon
improvement in standard of living. Bangladesh Power Development Board, Rural
Electrification Board, Dhaka Electric Supply Authority, Dhaka Electric Supply Company
has been meeting the requirement for electricity by way of involvement with electricity
generation and distribution system. In the recent time electricity generation and distribution
network are being strengthened by way of involvement of Private Sector in Electricity
Generation and distribution network so that the Govt. will be able to supply electricity to
every household of the country by 2020.

The contribution of Electricity in GDP and its growth over the years are given in table - I.

Table - I
Share of Electricity in GDP and its Annual Growth

Year Share in % of GDP Annual Growth Rate in %

2000-2001 1.23 7.60
2001-2002 1.27 7.78
2002-2003 1.30 7.29
2003-2004 1.34 9.19
2004-2005 1.38 9.22

Bangladesh Economic Survey 2005, Page # 99.

It is revealed from Table - I that the share of electricity has increased from 1.23% in 2000-
2001 to 138% in 2004-2005. The annual growth rate has increased from 7.60% in 2000-
2001 to 9.22% in 2004-2005 showing an annual average rate of increase of 5%.
16

4. Generating Capacity of Electricity

It has already been mentioned that generating of electricity is being shared by BPDB, REB,
DESA & DESCo. The total generating capacity for the period from 1999-2000 to 2003-
2004 is presented in Table - II.

Table - II
Electricity Generating Capacity
Year IN MW
1999-2000 2665
2000 -2001 3033
2001-2002 3218
2002-2003 3458
2003-2004 3622
Bangladesh Economic Survey 2005, Page # 102

It appears that the generating capacity of the existing power plant in the country has
Increased from 2665 MW in 1999-2000 to 3622 MW in 2003-2004. The annual
average rate of increaser was 9% which was quite significant.

05. Action Plant of the Government for Development of Electricity System:

In order to supply electricity to each and every household throughout the country by
2020, the Government has adopted massive action plan along with maintenance and
renovation of the existing power plants. Upon implementation of Govt. action
programmed, Govt. desires that by 2020 the installed generating capacity will
increase to 17765 MW. To implement the program, a total fund of Tk. 19788 crore
till 2007, Tk. 38456 crore till 2012 and Tk. 85626 crore till 2020 will be required.
The means of finance will come from Government as well as from private source.
The action plan taken by Government for generation of electricity by 2020 Is
detailed in Table-Ill.
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Table -III
Development Plan in Electricity
Generation Management by 2020.
Item 2004 2007 2012 2020 Addition
Installed Capacity (MW) 4710 6441 9666 17765 13055
Maximum Attainable Capacity 3622 5368 7887 14600 10978
(MW)
No. of Consumers (Lakh) 80 90 127 208 128
No. of Electricity Village 44546 52071 69571 84000 39454
Per head Electricity Generation 155 190 260 450 295
(Kwh)
Population under Electricity 35% 47% 65% 100% 65%
Network in %
Investment (Crore Tk.) - 19788 38456 85626

Bangladesh Economic Survey 2005, Page 107.

06. Future Action Plan for Restructure of Electricity Sector :

In order to ensure the supply of electricity for each and every population of the
country by 2020, the long term objective of the Government (Approved in principle)
are given below:

-Commercialization of corporate bodies to make them financially sound;

-Formation of several company for production and distribution and to encourage

participation of private sector in the process of production and distribution;

-Creation of Competitive market through restructure (Multi-user/Competitive pool);

and

-Increase of efficiency in the sector at competitive environment under regulatory

commission and to ensure the rights and privileges of the consumers..

a. Impact on National Productivity

Electricity has been identified as a principal component of the infrastructure to achieve

soda-economic development of the country. Uninterrupted reliable power promotes
18

productivity in agriculture, commerce, small & cottage industries and large industries
resulting in creation of jobs to the unemployed and increase of national productivity.

b. Employment Generation through the project

For Socio-economic development more employment opportunities will be created in

different economic sectors, particularly in agriculture and rural industries with the
improvement of power supply situation through implementation of the project. Emerging
rural and cottage industries having the benefit of electricity will create employment
opportunities for both male and female labor force.

c. Contribution to Poverty Alleviation

Electrification and supply of uninterrupted electric power have been identified as a

principal component of the overall infrastructure of the country to achieve the goal of
development in particular and that of the national economy in general. Electrification
promotes productivity in agriculture, helps emergence of small and cottager industries
resulting in creation of jobs to the unemployed and increase of national productivity. With
the improvement of power supply situation through implementation of the project, more
employment opportunities will be created in different economic sectors, especially in
agriculture and industries. Emerging small & large size industries having the benefit of
electricity will create employment

opportunities for both male and female labor force. Gainful employment resulting from the
project would increase the purchasing power of the would be employed people who would
have more access to consumer goods to meet the basic needs. The project thus will have
favorable impact ion alleviation of poverty,

d. Development of Local Manpower

The proposed power station shall be a demonstrating arena of recent advancements

in electric power generation technology and business. Many local engineers &
technicians will be engaged in implementation of the project and O&M of the power
station, and will avail themselves of the chance to explore the technology, which
will enrich the skill levels of local manpower and will add to the national asset
thereby.

08. Risk Factors and Mitigation Approaches :

The project is vulnerable to the following financial risk factors arising from
both the implementation and operational phase.

a. Delay in Commercial Operations

19

If the COD of the plant has not occurred by the required date and such date has not been
extended in accordance with this Agreement or as a consequence of any Force Majeure
Event, Company shall pay BPDB within 14 days after COD as Liquidated damages (LD),
an amount equal to BDT 14,000 per MW capacity per day or fraction thereof. In no event
shall this total amount be 3 months equivalent Rental Payment.

b. Shortfall in Guaranteed Capacity

If the Dependable Capacity is found less than the Contracted Capacity upon
conducting the Commercial Operations Test, then the Company has to pay LD for
the shortfall in capacity at the rate of BDT 70,0001Kw within 7 days after COD.

c. LD for Outages

In the event that the sum of Equivalent Forced Outages Energy ('a'),
maintenance Outages Energy CO and Scheduled Outages Energy ('c') exceed
0 MWh, where 0 equals the Average Dependable Capacity multiplied by 876,
then the Company shall pay to BPDB an amount of the Rental Factor
multiplied by (a+b+c-0) for that contract year. The Rental Factor Amount in
any contract year shall be equal to the product of Rental Price and 1.37.

cl. Mitigation Approach

Coverage against the risk factors (a) and (b) mentioned above shall be
realized through the back-to-back guarantee in the RPC Contract, where the
Contractor shall be bound to provide those guarantees or amounts specified
in case of any inconsistency.

Risk arising from outage (item c) shall be minimized by engaging a potential

and experienced O&M Contractor to operate & maintain the facility and by
transferring the financial liabilities arising thereto to the Contractor's Scope.

09. Project Revenue:

20

Tariff Structure of the project consists of princ.ipally two parts, Le. Rental
Payment and Energy Payment. The Rental Payment is further divided into two
parts, one is non-escalable and the other one is escalable. The non-escalable
Portion compensates for the retu rns on equ ity and de.bt services repayment
whereas the escalable portion covers the fixed operating expenses of the plant
like the Rental Payment. The Energy Payment is also divided into two Parts -
Variable O&M, which is subject to adjustment in inflation declared by
Bangladesh Bank and Fuel Payment.

Operation of the project shall bring out a base case reven ue stream as
scheduled in the following Table, through payments under the terms and
conditions of power supply Ag reement.
Base Case Reven ue of the Project

Rental
Plant Fixed O&M Variable Fuel Price
Payment
Factor Factor Payment O&M (BDT)
(BDT)
(BDT) Payment
(BDT)
100% 34,312,305 11,437,432 15,782,892 61,111,143
90% 34,312,305 11,437,432 14,204,602 55,000,289
80% 34,312,305 11,437,432 12,626,313 48,889,146
70% 34,312,305 11,437,432 11,048,024 42,778,003
60% 34,312,305 11,437,432 9,469,735 36,666,859
50% 34,312,305 11,437,432 7,469,735 30,555,716
40% 34,312,305 11,437,432 6,313,156 24,444,573
30% 34,312,305 11,437,432 4,734,876 18,333,429
20% 34,312,305 11,437,432 3,516,578 12,222,266
10% 34,312,305 11,437,432 1,578,735 6,111,143
00% 34,312,305 11,437,432 - -

Notes:

Rental Payment will be fixed throughout the tenure for 1S years.

1. Fixed and variable O&M payment will be increased subject to inflation

declared by Bangladesh bank
2. Fuel Payment will be increased subject to increase in fuel price of
COB/Supplier
21

04. The project will generate base case minimum revenue of BDT 45,749,
737 per month, irrespective of dispatch factor.

Financial Aspects

Cost of Project:

The total cost of the project has been estimated at Tk. 24314.60 lac. Cost of
the project and means of finance are as follows:

(Tk. in ‘000’)

Incurred To be incurred T
o
t
a
l
F/C L/C
Land 47325 0 20000 67325
Building and other civil works 0 0 55200 55200
Imported Machinery 0 187040 196392 2066792
22

Local Machinery 0 0 2290 2290

Utility Cost 0 0 80000 80000
Vehicles 0 0 12300 12300
Furniture, Fixture & Equipment 0 0 2000 2000
Consultant’s fee 0 0 3500 3500
Pre - operating expenses 0 0 4500 4500
Profit During Construction 0 0 137553 137553
0
Total cost of the project 47325 187040 513735 2431460
0
Means of Finance :
The above cost of the project is to be financed as under:
(Tk. in ‘000’)

Item Bank Sponsors Total

Land 0 67325 67325

Building and other civil works 38640 16560 55200
Imported Machinery 1870400 196392 2066792
Local Machinery 0 2290 2290
Utility Cost 36128 43872 80000
Vehicles 0 12300 12300
Furniture, Fixture & Equipment 0 2000 2000
Consultant’s fee 0 3500 3500
Pre - operating expenses 0 4500 4500
Profit During Construction 137553 0 137553

Total 2082721 348739 2431460

Equity Capital :
The implementation of the project will involve a total capital outlay of Taka
24314.60 lac of which the promoter's participation in equity has been assessed at
Tk. 3487.39 lac. The promoter's equity participation will be raised in the form of
paid-up capital.
Investment-e ratio:
Without Profit DCP - 80: 20.
With profit DCP - 86: 14.

Fixed Assets Coverage Ratio :

23

The fixed assets coverage to Bank's long term investment will be 1.17 times on
completion of the project.
Financial Evaluation:
The financial model has been prepared by the Project Consultant in a
comprehensive and customized manner to fit for the purpose of this project
including standard features available in a financial model of similar size project.

Base Case Assumptions:

The assumptions made for the base case model are subjective and may vary in the
future. The actual results can vary with the financial projection. Therefore, the
reviewers making any decisions relying on the financial projections should keep in
mind the inherent uncertainties of the assumptions.
Currencies

The currency used in the model is the local currency, i.e. BDT. Costs which
are in USD or other currency have been converted into BDT by applying the
projected exchange rate of Tk. Against US Dollar. The exchange rates have
been projected In accordance with purchasing power parity (PPP). As major
portion of the costs are denominated in US Dollar, there will very little
change in the projection with any variation f exchange rate unless the actual
exchange rates are found undervalued or
overvalued in short term.

iii. Exchange Rate

Tk. 70.00 for one US Dollar as prevailed in August 2007 is taken as the
exchange rate for the base case model and future exchange rate has been
projected on the basis of assumed change in US CPI and Bangladesh CPI. As
Taka-US Dollar exchange rate is now determined by the market on the basis of
supply and demand, this exchange rate is likely to follow the PPP in the long
run. However, in the short term, Taka may be overvalued or undervalued
against the US Dollar due to limitations and interferences.

iv Inflation
24

Last 4-5 years inflation declared by Bangladesh Bank has been observed 5% to
7%, though in the recent days the figure went up to 9% to 10%. As a conservative
approach for revenue the rate of change of Bangladesh CPI is assumed 5% per
annum whereas for O&M cost assumptions it varies

7% to 10% considering specific items.

As the revenue stream and a major part of ©&M will be in BDT so the
changes for UP PSI has no impact on the model, though it has assumed

2.3% per annum.

v. Mark Up on Debt and Debt Tenure

All debt services are assumed to bear fixed mark Up @14%. This mark up and
principal repayment are considered as fully (100%) hedged both before and
after construction from revenue stream. Debt repayment tenure has been
considered 10 years from Commercial Operation Date

(COD).

vi. Depreciations

The economic life of depreciable assets is taken as 15 years for book

depreciation. In calculation of income tax, a depreciation as straight line approach
@6.6667% per annum on the written down value is assumed, as applied under
the Bangladesh Tax laws.

vii. Sales Tax & AIT

An amount corresponding to 4.5% of sales Tax and 4% of Advanced Income

Tax (AIT) is to be deducted at source by BPDB. After tax assessment
remaining tax will be paid as applied under the Bangladesh Tax Laws. All of
these have been considered in the financial model.

viii Fuel Cost

25

The fuel payment from BPDB under Power Supply Agreement is

calculated by applying the declared flat heat rate of 13,200 Kj/KWh and prevailing
gas price of Tk. 73.91 per MSCF under the GSA, the HHV of supplied gas will
950 Btu/SCF. Similarly, gas payment to the gas supplier under the Gas Supply
Agreement is calculated by applying RPC heat rate of 9,000 1(1/KWh and gas
price as mentioned above 5% escalation for fuel price has been assumed in the
base case model. As EPC heat rate is lower than PPA heat rate, any
escalation of fuel price will improve financial performance of the project.

Investment -service coverage ratio:

The investment-service coverage ratio of the project works out to

1.92,1.10,1.23,1.31,1.41,1.52,1.65,1.82 & 2.03 times during the first ten years of projected
operation of the project.

Break -Even Analysis:

The project is expected to break-even at 22.39% of the proposed capacity

utilization with sales volume of Tk. 3052.80 Lac.

Financial Rate of Return:

The financial rate of return of the project has been computed following the
discounted cash flow techniques. The project promises a financial rate of return about
23.56%.

Fund Flow Statement:

The fund flow statement based on the profitability estimate has been made. The
projection indicates that the concern will have adequate cash generation to meet all
26

the operational expenses, pay for its debt- obligation and a reasonable surplus to pay
dividend, etc.

Projected Balance Sheet:

The projected balance sheet of the company has been shown. The concern is
expected to maintain a healthy financial position during the operational life.

Fixed Cost of the Project

Annex-1

Tk. in ‘000’

Item Incurred F/C To be L/C Total

Incurre Cost
d Eqvt.
Tk.
01. Land
Cost of 631 decimal land 47325 0 0 0 47325
Cost of land development 0 0 0 200 20000
00
Sub Total 47325 0 0 67325
200
00
02.Building & Other Civil Works
Sub Total 0 0 0 552 55200
00
0 0 0 55200
552
00
03.Machinery to be imported: 0 26720000 18704 0 187040
00 0
Cost of Machinery (Annex-III/A) 0 935
USD 0 20 93520
0
Import Duty (5% CAF Cost) 0 187 18704
0
04
Pre-Shipment Inspection (1% of 0 18704
0
C&F) 187
0 18704
0 04
Marine Insurance (1% of C&F)
0 28056
0 187
Clearing Forwarding charges (1%
27

of C&F) 0 0 04 18704
L.C Commission (1.5% of C&F) 0 280
56
Loading, unloading & local carrying
(1% of C&F ) 187
04
Sub-Total 0 26720000 18704 196 206679
00 392 2

Fixed Cost of the Project

Annex-1

Tk. in ‘000’

Item Incurred F/C To be L/C Total

Incurre Cost
d Eqvt.
Tk.
04. Local Machinery & Equipment
28

As per Annexure III/B 0 0 0 229 2290

0
Sub-Total 0 0 0 2290
229
0
05. Utility Cost:
Gas Line Drawing (2 km) including 0 0 0 800 80000
material 00
0 0 0 80000
Sub Total 800
00
06. Vehicles: 0
Pick Up Van -1 0 0 0 100 1000
0
Truck -1 0 0 0 1800
180
Microbus -1 0 0 0 1500
0
Jeep -2 0 0 0 8000
150
0
Sub Total 800 12300
0

123
00
07. Office Equipment/Other Assets: 0 0 0 200 2000
0
Furniture, Fixture & Equipment
Sub-Total 0 0 0 200 2000
0
29

Fixed Cost of the Project

Annex-1

Tk. in ‘000’

Item Incurred F/C To be L/C Total

Incurre Cost
d Eqvt.
Tk.
08. Consultant Fee:
Consultant’s Fee 0 0 0 350 3500
0
Sub-Total 0 0 0 3500
350
0
09. Pre-operating Expenses:
Trade License, Environment, Boiler 0 0 0 100 1000
and Explosive, IRC, ERC, etc. 0
0 0 0 2500
Bangladesh Energy Regulatory 250
500
Commission Test Run 0
500
Legal & Documentation 500
4500
Sub-total 500
450
0
10. Profit During Construction
Period:
0 0 0 137 137553
On Tk. 19650.40 Lac Profit 14% 553
per anum for a period of 6 months

Sub-Total 0 0 0 137 137553

553
30

47325 26720000 18704 513 243146

00 735 0
1 US$= 70.00

Building and Other Civil Construction

Annex-1

Tk. in ‘000’

Item of Construction Specificat Covered Rate Total

ion Area in per Sft. Cost
Sft.
01. Boundary Wall 3000 Rft 3000 1333 4000

02.Drainage LS 1000
03. Internal Road LS 10000
31

04. Office Building Single 3000 1000 3000

storied
pucca
building
05. Dormitory for Office Staff and Semi 6000 800 4800
Workers pucca
building
06. Plant Building:
Ground Floor Heavy 2500 3000 7500
Cast in
situ pile
foundatio
Mezzanaine Floor n 60 2500 3000 7500
meter
depth
1st Floor Rcc 5000 500 2500
Construct
ion
Rcc
Construct
ion
06. Ware House Semi 5000 500 2500
pucca
building
07. Family Quarter (4 Nos.) Rcc 6000 1000 6000
Construct
Single Storied building
ion
08. Rest House Semi 2000 700 1400
pucca
building
Total 55200
Cost of
Building
& Civil
Works
1 US$= 70.00
32

List of Machinery to be imported

Annex-1

Tk. in ‘000’

Name of Machinery Origin Unit Unit Total

Price US$
in
US$.
86 MW Power Plant (ISO Condition
114 MW)
01. GE-ALSTON Heavy duty France 2
turbine Frame-6, output 38 MW
fitting with 2 Detrot Diesel Engine
02. GE-ALSTON Steem Turbine France 1
Output 38 MW
03. Heat Recovery Boiler 61 Ton 2
Capacity
04. Gas booster Compressor 2
05. Natural Gas Purification Station 1
06.Condensing Unit 1
07. Water Treatment Plant 1
08.Water Cooling System 1
09. Step-up- transformer 3
10.Step-down transformer 2
11. Control Unit 4
12. Pumps, Valves, Silencer, Fire 1
fighting System etc.
33

13. DRS 1
Total 267200
Cost in 00
US$
15. Spare Parts Lot 1 00
Total 267200
Cost of 00
Machiner
y in US$
Eqvt. To 187040
Tk. 0
1 US$= 70.00

List of Local Machinery to be Procured

Annex-III/B

Tk. in ‘000’

Name of Machinery Unit Quantity Unit Total

Price Tk. in
in Tk. ‘000’
01. Air Conditioner No. 2 10000 200
34

0
02. Deep tube Well with Pump & No. 2 10000 2000
Motor 00
03. Computer with Printer Set. 2 45000 90
2290
35

List of Furnitures, Fixtures & Equipment

Annex-III/B

Tk. in ‘000’

Name of Item Unit Quantity Unit Total

Price Tk. in
in Tk. ‘000’
01. Furnitures, Fixtures LS 1 15000 150000
00 0
02. Local Phone Set 6 15000 900000
03. Mobile Set. 21 10000 210000
04. Air Cooler Window Type No 4 50000 200000
200000
0
36

Schedule of Construction

(Estimated in Months)

Annex-IV

Tk. in ‘000’

Name of Item Unit

01.Project Development Phase July 07 to Sept
. 07.
02. EPC Selection June 07 to Aug
07
03. Land & Infrastructure Aug 07 to Feb
Development 08
04. Gas Pipe Line Construction Aug 07 to Feb
08
05. Electrical Interconnection Work Aug 07 to Jan
08
06. Project Construction Aug 07 to Mar
08
07. EPC Work Aug 07 to May
08
37

08.Shipment of Machinery from Dec 07 to Feb

China port to Ctg. 08
09. Transmission from Port Site Jan 08 to Feb
08
10. COD Detection May 08
 Earning Forecast

Annex-V
Tk. in ‘000’

Item 2nd Year 4th Year 5th Year 6th Year 7th Year 8th 9th Year 10th Year
Year
A. Operating Revenue
a) Capacity Charge 563064 578574 586916 595675 604871 61452 624666 635315
7
b )Energy Charge 712118 785110 824365 865584 908864 1002022 1052123
95430
c) Supplementary Payments 0 0 0 0 0 0 0
6
0
Total Tariff 1275182 1363684 1411281 146125 151373 1626688 1687435
9 5
15688
Less: Sales Tax/Vat 57383 61366 63508 33 73201 75935
65757 68118
Less: AIT 51007 54547 56451 65068 67497
58450 60549
Net Tariff 1166792 1247771 1291322 70597 1488420 1544003
133705 138506
Total Inflow (After AIT) 1166792 1247771 1291322 62753 1488420 1544003
2 8
14354
133705 138506
82
2 8
14354
82
B. Operating Expenses 64341 69728 72816 78381 82092 86160 90620 95511
Fixed O&M Expenses 138866 158988 170116 182025 194767 20840 222988 238598
0
Variable O&M Expenses 385876 425429 446701 469035 492487 542967 570116
51711
Fixed Cost
2
Total Expenses 589083 654145 689633 729441 769346 81167 856575 904225
2
Earning Forecast

Annex-V
Tk. in ‘000’

Item 2nd Year 4th Year 5th Year 6th Year 7th Year 8th 9th Year 10th Year
Year
C. EBITD 628716 648174 658140 666059 676270 68656 696910 707275
3
Less: Depreciation 116667 116667 116667 116667 116667 116667 116667
11666
D. EBIT 512049 531507 541473 549392 559603 580243 590608
7
Less Profit on Bank Investment 261095 199960 169393 138825 108257 47122 16555
56989
E. Profit Before Tax 250954 331547 372080 410567 451346 6 533121 574053
Income Tax Payable 100382 132619 148832 164227 180538 77690 213248 229621
Paid as AIT 51007 54547 56451 58450 60549 4 65068 67497
Remaining to be Paid 49374 78071 92381 105776 119989 49220 148181 162124
6
150572 198928 223248 246340 270808 319873 3444432
F. Net Profit 19688
2
Ratios
62753
Net Tariff to Total Tariff 92% 92% 92% 92% 92% 92% 92%
13412
EBITD to Tariff 49% 48% 47% 46% 45% 43% 42%
9
Net Profit to Tariff 12% 15% 16% 17% 18% 20% 20%
29532
Investment Service Coverage 1.10 1.23 1.31 1.41 1.52 4 1.82 2.03
Ratio

92%
44%
19%
1.65
 Availability & Generation Chart

Annex-VII
Tk. in ‘000’

Item 2nd Year 4th Year 5th Year 6th Year 7th Year 8th 9th Year 10th Year
Year
86 86 86 86 86 86
Installed Capacity -MW 86 86
 86 86 86 86 86 86 86 86
Available Capacity -MW
8760 8760 8760 8760 8760 8760 8760 8760
Total Hours (In Year)
240 720 240 240 360 240
240 240
100 100 100 100 100 100 100 100
Outage Schedule & Hours :
Total Schedule Outage Hours 340 820 340 340 460 340
340 340
Force Maintenance Hours
8420 7940 8420 8420 8300 8420
Total Outage Hours 8420 8420
Available Hours 96.12% 96.12% 96.12% 90.64% 96.12% 94.75 96.12% 96.12%
Availability %
527352 527352 527352 527352 527352 52735 527352 527352
2

Energy Generation (GWh )

Estimates of Financial Expenses

Annex-VIII
Tk. in ‘000’
Item 2nd Year 4th Year 5th Year 6th Year 7th Year 8th 9th Year 10th Year
Year
169393 138825 108257 77690 47122 16555
Profit During construction 261095 199960
169393 138825 108257 77690 47122 16555
261095 199960
Profit on Bank’s Term Investment
1310020 109168 83340 65500 436660 218320
1965040 1528360
Principal 0 0
218340 218340 218340 218340 218340 21834 218340 218320
0
Installment 109160 873340 655000 43666 218320 0
1746700 1310020
0
169393 138825 108257 77690 47122 16555
Balance 261095 199960

Profit @14% P.A

Amortization of Term Investment

Annex-VIII

Installment Principal Principal Installment Interest

No Installment
1 1965040 0 22925
2 1965040 0 22925
3 1965040 0 22925
4 1965040 0 22925
5 1965040 0 22925
6 1965040 0 22925
7 1965040 0 22925
8 1965040 0 22925
9 1965040 0 22925
10 1965040 0 22925
11 1965040 0 22925
12 1965040 0 22925
13 1965040 0 22925
14 1946845 18195 22713
15 1928650 18195 22501
16 1910455 18195 22289
17 1892260 18195 22076
18 1874065 18195 21864
19 1855870 18195 21652
20 1837675 18195 21440
21 1819480 18195 21227
22 1801285 18195 21015
23 1783090 18195 20803
24 1764895 18195 20590
25 1746700 18195 20378
26 1728505 20166
27 1710310 19954
28 1692115 19741
29 1673920 19529
30 1655725 19317
Amortization of Term Investment

Annex-VIII

Principal Principal Interest Installment

Installment No.
Installment
1637530 18195 19105
31
1619335 18195 18892
32
1601140 18195 18680
33
1582945 18195 18468
34
1564750 18195 18255
35
1546555 18195 18043
36
1528360 18195 17831
37
1510165 18195 17619
38
1491970 18195 17406
39
1473775 18195 17194
40
1455580 18195 16982
41
1437385 18195 19769
42
1419190 18195 16557
43
1400995 18195 16345
44
1382800 18195 16133
45
1364605 18195 15920
46
1346410 18195 15708
47
1328215 18195 15496
48
1310020 18195 15284
49
1291825 18195 15071
50
1273630 18195 14859
51
1255435 18195 14647
52
1237240 18195 14434
53
1219045 18195 14222
54
1200850 18195 14010
55
1182655 18195 13798
56
1164460 18195 13585
57
 1146265 18195 13373
58
1128070 18195 13161
59
1109875 18195 12949
60
Amortization of Term Investment

Annex-VIII

Principal Principal Interest Installment

Installment No.
Installment
545830 18195 6368
91
527635 18195 6156
92
509440 18195 5943
93
491245 18195 5731
94
473050 18195 5519
95
454855 18195 5307
96
436660 18195 52094
97
418465 18195 4882
98
400270 18195 4670
99
382075 18195 4458
100
363880 18195 4245
101
345685 18195 4033
102
327490 18195 3821
103
309295 18195 3608
104
291100 18195 3396
105
272905 18195 3184
106
254710 18195 2972
107
236515 18195 2759
108
218320 18195 2547
109
200125 18195 2335
110
181930 18195 2123
111
163735 18195 1910
112
Amortization of Term Investment

Annex-VIII

Principal Principal Interest Installment

Installment No.
Installment
145540 18195 1698
113
127345 18195 1486
114
109150 18195 1273
115
90955 18195 1061
116
72760 18195 849
117
54565 18195 637
118
36370 18195 424
119
18175 18147 212
120

Assumptions:

01. Amount of Term Investment : 1965040

:
02. Period of Term Investment 10 years
:
03. Mode of Payment Monthly
:
04. No. Of Installment 108
:
05. Grace Period 12 Months after the project
goes into operation
:
06. Rate of Profit 14%
Break Even Analysis

At the fourth year

Annex-IX

Tk in ‘000’

01.Tariff 1363684
02. Total Cost : Operational, 428676
Administrative and Financial
Item Total Cost Fixed Variable Cost
Cost
Cost 228716 69728 158988
Financial Expenses 199960 199960 0
Total 428676 269688 158988

P/V Ratio: Sales-Variable cost/sales 0.8834

Break Even Point (Sales)= Fixed 305280 22.39% of capacity
Cost/P/V Ratio utilization
22.39% of rated
capacity
 Projected Cash Flow Statement

Annex-X
Tk. in ‘000’
Sources Const. 1st Year 2nd 3rd 4th 6th Year 7th Year 8th Year 9th Year 10th Year
of Fund Year Year Year Year
Paid up 328867 - - - - - - - - -
capital
Operatin - 502589 512049 52169 53150 549392 559603 569896 580243 590608
g Profit 3 7
Deprecia - 116667 116667 116667 11666 116667 116667 116667 116667 116667
tion & 7
Wreitr 1965040 - - - - - - - - -
Off 137553 - - - - - - - - -
Banks 2431460 619256 628716 63836 64817 666059 676270 686563 696910 707275
Term 0 4
investme 2426960 -
nt 4500
Profit - 0 218340 21834 21834 218340 218340 218340 218340 218340
During 0 0
Construc - 27511 27511 27511 27511 0 0 0 0 0
tion - 275100 261095 23052 19996 138825 108257 77690 47122 16555
8 0
Total - 90996 100382 116466 13261 164227 180538 196882 213248 229621
9
2431480 393607 607328 59284 57843 521392 507135 492912 478710 464496
5 0
Utilizatio
n of 0 225649 21388 45515 69744 144667 169135 193651 218200 242779
Fund 0 0 225649 24703 29255 456361 601028 770163 963813 1182013
Capital 8 3
Expendit 0 225649 247038 29255 36229 601028 770163 963813 118201 1424792
ure 3 7 3
Prelimin
ary
Expenses
Repayme
nt of
Bank’s
term
Investner
Repayme
nt of
Profit
DCP
Repayme
nt of
Profit on
Banks
Invt.
Payment
of Tax

Total

Cash
Surplus/d
eficit
Opening
Balance
of Cash
Closing
Balance
of Cash
 Projected Balance Sheet

Annex-XI
Tk. in ‘000’
Properties & Assets Const. 2nd Year 3rd Year 4th Year 5t 6th Year 7th Year 8th 9th Year 10th Year
h
Year Year
Y
ea
r
Current Assets: 0 247038 292553 362297 4 601028 770163 96381 1182013 1424792
Cash & Bank Balance 5 3
6
3
Fixed Assets 6
Fixed Assets (net) 1
0 247038 292553 362297 4 601028 770163 96381 1182013 1424792
5 3
Total Assets 6
Term Investment: 3
6
Bank’s term Investment 1
Profit during
construction
243146 2198126 208145 196479 1 1731458 161479 14981 1381457 1264790
0 9 2 8 1 24
Owner’s Equity
4
Paid Up capital
8
Retained earning
1
2
Total Capital & 5
Liabilities 243146 2198126 208145 196479 1 1731458 161479 14981 1381457 1264790
0 9 2 8 1 24
4
8
1
2
5
243146 2445164 237401 232708 2 2332488 238495 24619 2563472 2689584
0 2 9 3 6 39
0
4
4
8
8
165040 1557550 143783 131002 1 873340 655000 43666 218320 0
0 0 0 0
9
1
6
8
0
137553 82531 55020 27509 0 0 0 0 0 0
210259 1829231 158338 133752 1 873340 655000 43666 218320 0
3 0 9 0 0
9
1
6
8
 0

328867 328867 328867 328867 3 328867 328867 32886 328867 328867

2 7
8
8
6
7
0 287066 461765 660693 8 1130281 140108 16964 2016285 2360717
8 9 12
3
9
4
1
328867 615933 790632 989560 1 1459148 172995 20252 2345152 2689584
2 6 79
1
2
8
0
8
243146 2445164 237401 232708 2 2332488 238495 24619 25643472 2689584
0 2 9 3 6 39
0
4
4
8
8
Financial Rate of Return

Annex-XII

Tk. in ‘000’

Investment Benefit Net Cash Flow

Year
2431460 0 -2431460
0
0 619256 619256
1
0 628716 628716
2
0 638360 638360
3
0 648174 648174
4
0 658140 658140
5
0 666059 666059
6
0 676270 676270
7
0 686563 686563
8
0 696910 696910
9
0 707275 707275
10
0 176299 176299
11
Financial Rate of Return = 23.56%

Assumptions:

01. The Economic life of the project :

has been estimated to be 10 years
without any major replacement
:
02. The Fixed cost of the project has Tk. 24314.60 Lac
been estimated at
Financial Rate of Return

Annex-XII

Tk. in ‘000’

03. Benefit of the project has been estimated as appended:

Operating Profit Depreciation Total

Operating Year
502589 116667 619256
1
512049 116667 628716
2
521693 116667 638360
3
531507 116667 648174
4
541473 116667 658140
5
549392 116667 666059
6
559603 116667 676270
7
569896 116667 686563
8
580243 116667 696910
9
590608 116667 707275
10
04. Recovery of capital i.e salvage value of the project at the 11th year.

Cost Recovery Percent Total

Item
67325 100% 67325
Land
55200 10% 5520
Building
2069082 5% 103454
Machinery
176299
 Invest-Service Coverage Ratio

Annex-XIII
Tk. in ‘000’
Income 1st 2nd 3rd 4th 5th Year 6th 7th 8th 9th 10th Year
Year Year Year Year Year Year Year Year
Profit 13649 150572 174699 19892 223248 24634 27080 295324 31987 344432
Depreciation & Write off 3 8 0 8 3
Financial Expenses 11667 11667 11667 11667 11667 11667 11667 11667 11667 11667

Obligation 27510 261095 230528 19996 169939 13882 10825 77690 47122 16555
0 0 3 5 7
Financial Expenses 52826 528334 521894 51555 509308 50183 49573 489681 48366 477654
0 5 2 2 2
Installment of Term Loan

Investment Service Coverage

Ratio 27510 261095 230528 19996 169393 13882 10825 77690 47122 16555
0 0 5 7
0 218340 218340 21834 218340 21834 21834 218340 21834 218320
0 0 0 0
27510 479435 448868 41830 387733 35716 32659 296030 26546 234875
0 0 5 7 2
1.62 1.10 1.16 1.23 1.31 1.41 1.52 1.65 1.82 2.03