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HOSPITALITY PROJECT REPORT

Market Feasibility & Financial Viability Opening a Four Star Hotel in Faridabad

SUBMITTED BY:

Nikita Pandey

UNDER THE GUIDANCE OF:

Mr. Divoy Chabra

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ACKNOWLEDGEMENT I find it difficult to pen down my deepest sense of indebt towards my parents and family members who soulfully provided me their constant support and the right input to undertake the challenge of this proportion like all other spheres of life, for what I cannot measure but treasure. They believed in me before I believed in myself. To whom I owe my wonderful today and dream filled future. I also owe my sincere thanks to Ms. Anjali Khanna, Head Of Department, Department of Tourism & Hospitality, Lovely Professional University, Phagwara; a special thanks to Mr. Divoy Chabra, Faculty Member, Department of Tourism & Hospitality, Lovely Professional University, Phagwara for providing me the necessary infrastructure and platform to work on this Research Study. And last but not the least a special word of thanks to all my friends and colleagues for their intermittent and timely doses of morale boosting, utmost care during my leaps and bounds and for giving me constant support.

Nikita Pandey

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CERTIFICATE

This is to certify that Nikita Pandey bearing Registration no. 10905939 has completed her capstone project titled, Market Feasibility and Financial Viability for Opening a Four Star Hotel in Faridabad. under my guidance and supervision. To the best of my knowledge, the present work is the result of her original investigation and study. No part of the dissertation has ever been submitted for any other degree at any University. The dissertation is fit for submission and the partial fulfillment of the conditions for the award of .........................

Signature and Name of the Research Supervisor Designation Lovely School of Tourism & Hospitality Lovely Professional University Phagwara, Punjab. Date :

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DECLARATION

I, Nikita Pandey, student of BHMCT under Department of Lovely School Of Tourism & Hospitality of Lovely Professional University, Punjab, hereby declare that all the information furnished in this dissertation / capstone project report is based on my own intensive research and is genuine. This dissertation / report does not, to the best of my knowledge, contain part of my work which has been submitted for the award of my degree either of this university or any other university without proper citation.

Date: Signature and Name of the student:

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Table of Content

Chapter 01

1.1 Introduction to Tourism 1.2 Introduction to Hotel Industry 1.3 Review of Existing project in the same category.

Chapter 02
2.1 Objective 2.2 Need and 2.3 Scope of project.

Chapter 03
3.1 Project design 3.2 Detail about the project.

Market feasibility: Target market. Introduction to Marketing and marketing mix.

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Demand analysis and quantification. Technical aspects & Manpower planning of the proposed Hotel. Project Profile.

Financial Viability: Tariff Structure. Cost of the Project. Sales Revenue. Estimation of Expanses. Working capital. Financing the Project. Estimation of Income Profitability statement. Cash Flow Statement. Cost Benefit Analysis. Break even analysis. Debt service coverage ratio. Sensitivity analysis.

Conclusion:

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Bibliography:

Annexure:

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Chapter 1

INTRODUCTION

1.1 INTRODUCTION TO TOURISM:

Tourism is defined as a composite of activities, services, and industries that delivers a travel experience to individuals and groups traveling fifty miles or from their homes for purposes of pleasure.

The business sectors comprising the tourism industry include: transportation, accommodations, eating and drinking establishments, shops, entertainment venues, activity facilities, and a variety of hospitality service providers who cater to individuals or groups traveling away from home.

Tourism product is not produced by a single business, nonprofit organization, or governmental agency; rather, it is defined as a satisfying visitor experience. This definition encompasses every activity and experience that a tourist encounters during his or her entire trip away from home

The importance of tourism in the global economy

Prior to September 11th 2001, travel and tourism was the worlds largest, $3.6 trillion, industry, generating 11% of global GDP, employing 200 million people, accounting for one in every 12 jobs and transporting nearly 700 million international travellers per year. This last figure is expected to double by 2020.

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International tourism arrivals in developing countries have grown by an average of 9.5% per year since 1990, compared to 4.6% worldwide1. The industry makes important contributions to developing country economies, representing the second largest source of foreign exchange after oil, although these countries currently have only a minority share of the international tourism market (approximately 30%). The aftershocks of the events of September 11th in the industry are impacting through a decline of tourists across the globe. In particular, destinations dependent on the American market e.g. some Caribbean islands, and where destinations are predominantly Muslim populations e.g. Indonesia.

Where tourism generates than 40% of GDP small, low and middle income island nations in the Caribbean and Pacific the impact of September 11th has confirmed some developing countries exposure to their dependency on tourism. Strategies to diversify and integrate their economies to protect livelihoods from the adverse shocks caused to tourism by political and natural disasters were already called for prior to September 11th and are even imperative now.

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Structure of the International Tourism Industry

TOURISM DESTINATION

Tour Operators

Tourist Boards Ground handlers Accommodation Restaurants Transport operators Attractions

ORIGINATING MARKET

Travel Agencies

SUPPORT SERVICES Airlines, cruise lines, other means of access

Infrastructure Utilities Health Education & Training Banks/finance

It is important to understand the highly complex nature of measuring the impact of tourism. The tourism product is made up of number of elements travel to a destination, accommodation and food, and services the tourist uses at the destination. It involves a diverse set of organisations and

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institutions travel agents, tour operators, airline companies, hotels, guest houses, rented accommodation, national and local tourist boards, national and local government (developmental, regulatory), local entrepreneurs, local services (banks, hospitals etc), community based organisations (CBOs) and Non-Governmental Organisations (NGOs).

In addition, tourism revenue is not calculated as a separate category in national accounts making it difficult to assess its overall economic impact.

The role of institutional capacity must be underlined. Section 2 will analyse the multi stakeholder approach required to understand and assess tourism enterprise development interventions. Here, we note the importance of national and local institutional development capacity in tourism support services, if tourism enterprise interventions are to maximise their potential positive impacts while minimising their negative impacts. Examples include unclear land tenure legislation and procedures, no effective land registry, and inadequate planning regulations and their enforcement.

Tourism Typologies

Mass Tourism :

Mass tourism (70% of market share today) grew rapidly in the 60s and 70s mainly as a function of increased disposable incomes. It was centred in North American and Western European destinations, and some island destinations like the Caribbean. This tourism was, and is, dominated by tour operators offering package tours to the sun, sea and sand, and often sex too.

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The product was about quantity, not quality. This product has been characterised by local income revenues being concentrated in densely packed tourist destinations that employ migrant labour from the hinterland and abroad. Local skills capacity remains low, with skilled, management jobs often being carried out by ex patriots.

The big UK based tour operators (e.g.Thomsons, First Choice, Airtours) that dominate the market are vertically integrated and own whole travel and accommodation product chains creating economies of scale that out compete small entrepreneurs on price. With the trend away from packaged four Ss and demand for authentic, individual and varied experiences, alternative producers now abound and compete on specialised product demand and quality.

With increasing disposable income in the 80s and 90s, and long haul travel becoming affordable to Europeans and North Americans, new destinations in the South were made accessible. The mass tourism, package tour model was replicated in many of these destinations despite warnings of the boom/bust syndrome that was affecting destinations that competed on price alone. (Butler, 1980)

Ecotourism to Sustainable Tourism:

The growing awareness of environmental and conservation damage caused by tourism, in conjunction with the Rio Summit establishing the triple bottom line of environmental, economic and social sustainability, saw development of new forms of tourism evolved in response to this sensitive international climate. Green tourism, adventure tourism, nature tourism, communitybased tourism, heritage tourism are all labels that are generally encapsulated in the term

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ecotourism that this paper uses to describe as alternative forms of tourism to mass tourism. These products market share is estimated at approxima tely 30%. While these products do bring development to remote regions, and hence poorer areas, it is not proven that they generate less damage and provide benefits than mass tourism.

Sustainable tourism development has been defined as tourism that maximises the potential of tourism for eradicating poverty by developing appropriate strategies in co-operation with all major groups, indigenous and local communities, (UN Commission on Sustainable Development, 1999). This definition builds on, and goes beyond the WCED, 1987 definition of sustainable development: development that meets the needs of the present without compromising the ability of future generations to meet their own needs (WCED, Our Common Future, 1987).

Ecotourism does not necessarily mean sustainable tourism. Rather, it is a term that is often used by operators as a marketing tool to promote a product that is perhaps based in a pristine, rural setting, or an authentic cultural environment. It does not mean that the product is sustainable in terms of its impact on local community livelihoods and resources. At the centre of the PPT approach is putting poor people and poverty at the centre of the sustainability debate.

However, it is the earlier, environmental definitions of sustainable development that have now been embraced by the global travel and tourism industry. Their responsibilities to this definition are largely targeted at environmental initiatives e.g. waste and rubbish disposal and water conservation. Addressing the socio-economic issues of tourism development has only been found

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in the domain of NGO backed community tourism projects. This, however, is now being addressed in set of new initiatives.

Responsible tourism A final recent distinction needs to be made between responsible and sustainable tourism. The current debate on sustainable tourism would, some argue (e.g. WWF UK), make sustainable tourism an unachievable ideal, not least because of the significant contribution that air travel makes to climate changes. The statement continues, it is therefore useful to think about responsible tourism within the context of a wider sustainable development strategy.

For these applications guidance notes we are discussing IA in tourism enterprise intervention in terms of all of the above definitions set out in Section 1.4, although now, most tourism enterprise level intervention does come under the label of sustainable development whether rural or urban, macro or micro.

1.2 INTRODUCTION TO HOTEL INDUSTRY

One of the fastest growing sectors of the economy of our time is the hotel industry. The hotel industry alone is a multi-billion dollar and growing enterprise. It is exciting, never boring and offer unlimited opportunities. The hotel industry is diverse enough for people to work in different areas of interest and still be employed within the hotel industry. This trend is not just in India, but also globally.

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Modern hotels provide refined services to their guests. The customers or guests are always right. This principle necessitated application of management principles in the hotel industry and the hotel professionals realized the instrumentality of marketing principles in managing the hotel industry. The concept of total quality management is found getting an important place in the marketing management of hotels. The emerging positive trend in the tourism industry indicates that hotel industry is like a reservoir from where the foreign exchange flows. This naturally draws our attention on HOTEL MANAGEMENT. Like other industries, the hotel industry also needs to explore avenues for innovation, so that a fair blending of core and peripheral services is made possible. It is not to be forgotten that the leading hotel companies of the world have been intensifying research to enrich their peripheral services with the motto of adding additional attractions to their service mix. It is against this background that we find the service mix flexible in nature. The recruitment and training programmes are required to be developed in the face of technological sophistication. The leading hotel companies have been found promoting an ongoing training programme so that the personnel come to know about the use of sophisticated communication technologies.

Hotel The Concept

At the outset, we go through the concept of hotel. The common law says that hotel is a place where all who conduct, themselves properly and who being able and ready to pay for their entertainment, accommodation and other services including the boarding like a temporary home.

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It is home away from home where all the modern amenities and facilities are available on a payment basis. It is also considered to be a place where tourist stops, cease to be travellers and become customers. The definition presented by hotel operators to authorities of the National Recovery Administration in Washington is found to be a comprehensive definition, presented by Stuart Mc Namara. The definition states that, Primarily and fundamentally, a hotel is an establishment which supplies boarding and lodging not engaged in inter state commerce or in any intra state commerce, competitive with or affecting inter state commerce (or so related that the regulation of one involves the control of other). The hotel may furnish quarters and facilities for assemblage of people for social business or entertainment purposes and may engage in retaining portion of its premises for shops and businesses whose continuity (i.e., proximity) is deemed appropriate to a hotel. The assemblage of people for social business and entertainment purposes makes it essential that hotels are also furnished with a big conference hall where the maximum possible accommodation is available. We also call it the function room.

Motel The Concept

Initially the term motel was meant for local motorists and foreign tourists travelling by road. They serve the needs and requirements of these travellers and meeting their demand for transit and accommodation. Some of the important services offered by the motels are parking, garage facilities, accommodation, and restaurant facilities. Motels are found located outside the city, preferably by the side of high ways and important road junctions. The accommodation in this is in the category of a chalet facility. In USA, the motel accommodation is ranked at par with hotel accommodation.

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Origin of the word Hotel

Before 1760 people used to go to inns for having their lunch, dinner etc .It was the place where families used to host their guest inns owner used to provide lodging and boarding facility service to their guest. To world hostel was used then it was called hostelier which means head of unit or the place. The Norman people invented the word hotel. The word hotel was originally in England, officially from 1760. The real growth of modern hotel was originated in U.S.A with opening of City Hotel in New York in the year 1974. This was the first building erected for the hotel purpose. This period also saw the beginning of chain operation under the guidance of E.M.STATLER. It involves big investment, big profits and trained professional to manage business.

Origin of Hotel Industry

The origin and the development of the hospitality industry is a direct outcome of travel and tourism. There are many reasons for which a person may travel: business, pleasure, further studies, medical treatment, pilgrimage or any other reasons. When a person travels for few or more days, he may carry his clothes with him, but it is not possible for him to carry his food and home. Thus two of thee basic needs food and shelter- are not taken care of when he is travelling. This is where the hospitality industry steps in.

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Before the wheel was invented, people undertook journeys on animals such as horses, camels and elephants. In those days they used to travel in groups called Caravans for safety. However, there was a limit to the distance they could cover in a day. At nightfall they avoided travel due to the fear of wild animals and bandits, and also because of animal fatigue. Thus for the night halt, they looked for a place that could provide them with water fuel to cook food and above all security from wild animals and bandits.

The primitive lodging houses or inns originated essentially to cater to these needs of the travelers. Throughout the world they were known by different names, such as dharamshala and sarai in India, ryokans in Japan, paradors in Spain, pousadas in Portugal, coffee houses in America, taverns and inns in Europe, cabarets and hostelries in France, mansionis and hospitia in Switzerland, phatnal in Greece and relay houses in China.

The repreciation in 1930 had a disaster effect in a hotel industry after the World War II and brought a tremendous up surge to hotel industry with continuous prosperity of hotel industry.

Mass travel is a modern phenomenon that emerged after World War II. Mass tourism continues to grow as political freedom, economic wherewithal and social equality spread across the globe. With the economic engine of development running at full steam, there was a growth in international travel and thereby growth in hotel industry.

Estimates abound as to the importance and size of house keeping. Certainly, its economic contribution is critical to the global economy whether as a service to the business community.

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Background of Hotel Industry

Prior to the 1980s, the Indian hotel industry was a nascent and slow growing industry primarily consisting of relatively static, single hotel companies. However, Asian games in 1982 and the subsequent partial liberalization of the Indian economy generated tourism interest in India with significant benefits accruing to the hotel and tourism sector in terms of improved demand patterns. Fortunes of the hotel industry are tied to the fortunes of tourism and the general business climate in the country, which is why the economic liberalization initiatives implemented since 1991, led to a soaring demand and supply gap in the hotel industry.

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1.3Review of Existing Project

Park Plaza, Faridabad

Hotel Amenities:

General

Park Plaza Faridabad features an outdoor pool and a fitness facility. Dining is available at one of the hotel's 4 restaurants. A bar/lounge is on site where guests can unwind with a drink. Public areas are equipped with complimentary high-speed wireless Internet access. This 4-star property offers access to a business center and audiovisual equipment. Event facilities include a conference center, conference/meeting rooms, and banquet facilities. This business-friendly hotel also offers a rooftop terrace, spa services, and tour/ticket assistance.

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For a surcharge, a roundtrip airport shuttle (available on request) is offered to guests. Complimentary valet parking is available on site.

Air-conditioned public areas Free parking Spa services on site 24-hour front desk Airport transportation (surcharge) Elevator/lift Valet parking Free valet parking Total number of rooms - 78 Audiovisual equipment Banquet facilities Bar/lounge Business center Multiple large conference rooms Dry cleaning/laundry service Event catering Fitness facilities Tours/ticket assistance Free Wi-Fi Rooftop terrace

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Room service (24 hours) Number of meeting/conference rooms - 3 Conference center Number of restaurants - 4 Swimming pool - outdoor

Internet

Available in all rooms: Free Wi-Fi Available in some public areas: Free Wi-Fi

Parking

Free parking, Valet parking, free valet parking

Room Amenities Minibar Coffee/tea maker Private bathroom Shower only Rainfall showerhead In-room safe Desk Satellite TV service

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Free Wi-Fi LCD TV

Dining

Veranda - This restaurant serves breakfast, lunch, and dinner. Guests can enjoy alfresco dining (weather permitting). 24-hour room service is available.

Recreation

Recreational amenities at the hotel include an outdoor pool and a fitness facility.

Policies & Fees:

Check-in

Check-in time starts at noon Check-out

Check-out time is noon

Payment Types

Accepted at this hotel: American Express, Carte Blanche, Diners Club, Discover, JCB International, MasterCard, Visa

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Policies

Extra-person charges may apply and vary depending on hotel policy. Government-issued photo identification and a credit card or cash deposit are required at check-in for incidental charges. Special requests are subject to availability upon check-in and may incur additional charges. Special requests cannot be guaranteed.

Fees

The following fees and deposits are charged by the property at time of service, check-in, or check-out.

Airport shuttle fee: INR 1700 per vehicle (one way) Rollaway bed fee: INR 1000 per night

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CHAPTER-2 OBJECTIVE, NEED and SCOPE

2.1 OBJECTIVES: 1. To ascertain the market feasibility. 2. To study the existing hotels and facilities provided by them. 3. Planning of staffing and manpower. 4. To study various places of tourist destinations. 5. To obtain various cost based study analysis in order to determine the financial viability of the project. 6. To study the financial viability of the project by using various concepts of accounting like break- even analysis , cash flow statement, profitability statements. 7. To outline in brief the various facilities to be provided in the proposed hotel project.

2.2 NEED OF THE PROJECT: Faridabad, the south-eastern district in the state of Haryana, with the object of protecting the Grand Trunk Road (now National Highway 2) which passed through the town. Thus there is a scope for the en-route guests to have a stay in Faridabad. Faridabad is the largest city and one of the major industrial hubs of Haryana. It generates 60% of the revenue of the state. 50% of the income tax collected in Haryana is from

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Faridabad and Gurgaon. As most of the visitors in Faridabad are business travelers and there is a shortage to star properties, thus there is a great need for star category property. Faridabad is famous for henna production from the agricultural sector while tractors, motorcycles, switch gears, refrigerators, shoes and tyres are the famous industrial products of the city. Thus it is quite obvious that in Faridabad every type of industry is present. So there is a need of such projects to cater the need of the travelers.

2.3 SCOPE FOR THE PROJECT:

Faridabad is the major industrial city of Haryana. Thus there are a major crowd of business travellers are coming. To cater those business travellers.

To know the type of cliental To decide the type of facility To design the tariff structure To estimate the occupancy

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CAHPTER 3 3.1Project Design

Name of the hotel:

Hotel Ciel

Type of property:

a 4 Star Property

Number of Rooms:

62

Location:

Hotel Ciel, Sec 12, Faridabad, HR

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Layout of the Hotel Ciel: Front View of Hotel Ciel:

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Layout of Basement:

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Layout of Ground Floor:

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Layout of First Floor:

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Layout of Second Floor:

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Layout of Third Floor:

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Layout of Fourth Floor:

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3.2 About the Project

LOCATION FARIDABAD

Faridabad is the largest city of Haryana state in northern India, in Faridabad district. It lies at 282516N Latitude and 771828E Longitude. The district shares its boundaries with the National Capital and Union Territory of Delhi to its north, Gurgaon district to the west and Uttar Pradesh to its east and south. Faridabad enjoys a prime location both geographically and politically. The river Yamuna separates the District Boundary on the eastern side with Uttar Pradesh. Delhi-Agra National Highway No.2 (Shershah Suri Marg) passes through the centre of the district. The city has many railway stations on the Delhi-Mathura double track broad-gauge line of the North Central Railway. The railway stations of Old Faridabad and New Industrial Township (NIT) are the major ones. Faridabad is the largest city and one of the major industrial hubs of Haryana. It generates 60% of the revenue of the state. 50% of the income tax collected in Haryana is from Faridabad and Gurgaon. Faridabad is famous for henna production from the agricultural sector while tractors, motorcycles, switch gears, refrigerators, shoes and tyres are the famous industrial products of the city. For the ease of Civil Administration, Faridabad district is divided into two sub divisions viz. Faridabad and Ballabgarh each headed by a Sub Divisional Magistrate. The Municipal Corporation of Faridabad (MCF) provides the urban civic amenities to the citizens of

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Faridabad City. Palwal, Hodal and Hathin Sub Divisions are now part of newly created Palwal District.

Geography City is located on the plains of the Yamuna river. It is bordered by the Yamuna to the east and Aravali Hills towards the west and southwest. Today, virtually all of the land has been developing with residential housing as the population of the city swelled during the mid 1990s. Much like the rest of India, the people of Faridabad rely on the ground water for their basic needs which is the gift of good monsoon season.

Climate The climate of Faridabad district can be classified as tropical steppe, semiarid and hot which is mainly characterized by the extreme dryness of the air except during monsoon months. During three months of south west monsoon from last week of June to September, the moist air of oceanic penetrate into the district and causes high humidity, cloudiness and monsoon rainfall. The period from October to December constitutes post monsoon season. The cold weather season prevails from January to the beginning of March and followed by the hot weather or summer season which prevails up to the last week of June. The normal annual rainfall in Faridabad district is about 542 mm spread over 27 days. The south west monsoon sets in the last week of June and withdraws towards the end of September and contributes about 85% of the annual rainfall. July and August are the wettest months 15% of the

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annual rainfall occurs during the non monsoon months in the wake of thunder storms and western disturbances. Culture of Faridabad The culture and tradition of Faridabad is similar to rest of country. It is the home of many culture and traditions. Every festival is celebrated here with lot of enthusiasm.

People: Jats and Gujars are the main castes that resides in this city. They depict a picture of happy and hardworking people. All the castes and communities represent communal harmony.

Languages: Hindi is widely spoken language in Faridabad while others are Haryanvi, English and Punjabi are other languages.

Famous Restaurants: The famous restaurants of Faridabad are: Silk , Zosse Crown Plaza, Moksha, and Pind Baluchi.

Fairs and Festivals

People celebrate here every fair and festival with enthusiasm.

Gangore Festival: It is celebrated in Spring which falls in March to April. It is celebrated to worship Gauri which is the deity of abundance. The procession is taken out with the water immersion of Gangore and Ishar images.

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Surajkund Crafts Mela: Surajkund is an exhibition fair where handlooms and handicrafts are displayed. It is held in every February. Its main aim was to aware tourists about the techniques of crafting. Food Festival, dancing and singing of the participants are other major attraction of Surajkund Crafts Mela.

Basant Panchami or Vasant Panchami: This festival is dedicated to Goddess Saraswati, the deity of education and wisdom. People involved themselves in kites flying. Yellow is the auspicious color of this occasion which is shown in their dresses to foods.

Transportation Rail

DelhiMetroPurpleLine Faridabad is on the broad gauge of New Delhi- Mumbai Line. New Delhi and Hazrat Nizammudin Railway Station is about 25 km away from Faridabad Station. The trains for big

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cities like Mumbai, Chennai, Hyderabad are easily accessible from here. Local Trains runs between New Delhi to Faridabad. There are three railway stations in the city viz. Faridabad (FDB), New Town Faridabad (FDN) and Ballabgarh (BVH). Earlier it was the last station of central railway, but now it has been included in Northern railway. It is a very high revenue generating source for railways as thousands of people move daily in local trains to and from Delhi for education/professions. The Delhi Metro Rail Corporation is extending the metro rail service to the city as well. Currently the services terminate at Badarpur at the Delhi-Faridabad border. It will cover the town under Phase - III expansion of the Delhi Metro The fully elevated corridor, the longest Metro line in the NCR, will be constructed at an estimated cost of Rs 2,533 crore by 2016 when the Delhi Metro's Phase-III is expected to be completed. Road The National Highway-2 (Delhi-Mathura Road) passes through the city, and thus it is well connected to nearby states. Roadways services of Haryana (Haryana Roadways) and neighbouring states like Delhi Transport Corporation, Uttar Pardesh Transport Department, and Madhya Pradesh Transport Department are easily accessible. Air Faridabad is served by Indira Gandhi International Airport, New Delhi.

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Tourism Badkhal Lake

Dried Badkhal lake Badkhal Lake was located in Badkhal village, 8 km from Delhi Border. The lake fringed by Aravalli hills was a man-made embankment. Owing to unchecked mining in the neighbouring Aravallis, the lake has totally dried up. There are functional Haryana Tourism restaurants in the vicinity. A flower show is held every spring here. Its name is most probably derived from the Persian word bedakhal, which means free from interference. Close to Badhkal Lake, is the Peacock Lake, which is another picturesque spot. The lake is dried up as of now and no lake exists apart from a dry ground. Suraj Kund Tourist Complex and the crafts fair

Suraj Kund Situated at a distance of around 8 km from South Delhi, it is an ideal picnic spot. The Suraj Kund Lake here is surrounded by rock cut steps. Built by Surajpal Tomar, Suraj Kund represents the

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rising sun. Ruins of a Sun temple lie around the lake. The complex includes a beautifully doneup Rajhans, a pool of fresh water Siddha Kund; its waters said to have healing properties and a garden.A delightful handloom and handicrafts fair is held here annually in February. Skilled artisans from all over the country display the rich crafts tradition of India in the typical setting of a rural Indian marketplace. Cultural programmes like folk dances, magic, acrobats and rural cuisines are also a part of this colourful fair. One can also see traditional crafts being made and buy them direct from the craftsmen. Food is served in Banana leaves and claypots. Raja Nahar Singh Palace Nahar Singh Mahal is also commonly known as Ballabgarh Fort-Palace was built by Balram the predecessor of Raja Nahar Singh. As a matter of respect and remembrance this palace was given the name of Raja Nahar Singh who died in a war of independence. This palace is known for its architecture. This is located at main road entering in Ballabgarh market which is at a distance of about 30 km from Delhi. The palace was recently worked with antiques and relics of a bygone past.

Other visitor attractions

Shirdi Sai Baba Temple Society Popularly Known as Sai Dham Tigaon Road Faridabad Shirdi Sai Baba Temple Shiva Temple St. Marys Orthodox Church Dhauj Lake Aravali Golf Course Nahar Singh Cricket Stadium

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Town Park Jharna Mandir village Mohabbtabad Farid Khan's Tomb mata vaishno devi mandir sansthan

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MARKET FEASIBILITY

TARGET MARKET

Faridabad is the industrial hub in Haryana. Faridabad is the largest city and one of the major industrial hubs of Haryana. It generates 60% of the revenue of the state. 50% of the income tax collected in Haryana is from Faridabad and Gurgaon. Faridabad is famous for henna production from the agricultural sector while tractors, motorcycles, switch gears, refrigerators, shoes and tyres are the famous industrial products of the city. Thus the Target Market for me the business visitors visiting to Faridabad, Because my project is a Business Hotel.

INTRODUCTION TO MARKETING AND MARKETING MIX

DEFINITION OF MARKETING

The word market is derived from the Latin work Marcatus meaning goods or trade or a place where business is conducted. The term marketing is defined as a business activity planned at satisfying to a reasonable extent, consumer or customer needs and wants, generally through on exchange process.

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The human needs are less and are important for his survival. The wants of people are many and varied and change with time, place and society. The wants keep changing with life styles, earning capacity of consumers, social values, education etc. Human intentions and decision to acquire may not be the same due to existing conditions. A man like or intend to stay in a five star hotel. He may decide (or acquire) a room in a three star hotel due to his tight financial position.

Kotler defines marketing as a social and managerial process by which individuals and groups obtain what they need and want through creating, offering and exchanging products of value with others.

As per the definition by the American Marketing Association (AMA), marketing is the process of planning and executing the conception, pricing promotion and distribution of ideas, goods and services to create exchanges that satisfy individual and organizational goals.

Market traditionally is a place where buyers and sellers gather to exchange their goods. With this concept of markets, it is seen that Marketing means working with markets to actualize potential exchanges for the purpose of satisfying human needs and wants. To meet the exchange process in the market, considerable skill and work is put by one party to the transaction. To bring in the desired response from the other party in a market, the marketer has to analyze, plan, implement and control activities.

Definition of Marketing Management, according to Kotler, is the process of planning and executing the conception, the pricing, promotion and distribution ideas, goods and services to

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create exchanges that satisfy individual and organizational goals. He has thus approved the definition of the AMA.

Marketing Management is engaged in influencing the level, timing the composition of demand in a manner that will help an organization to achieve its objectives. Marketing Management is basically demand management.

COMPONENTS AND CLASSIFICATION OF MARKET

Market is a social and economic institution which performs activities and provides infrastructure for exchange of commodities between buyers and sellers. A market is not confined to a particular geographical location, it exists wherever the fundamental forces of demand and supply exist.

Market Components
The following components are necessary for a market to exist: Two parties are necessary one buyer/s and secondly seller/s Goods or commodity for transaction. Physical existence of goods is not necessary. Business relation and communication between buyer and seller and Demarcation-area or place there, uniform price or competition is not a condition.

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Classification of Markets
Based on nature and dimensions, markets are classified as under:

1.

Area of Coverage

Local Market: Where buying and selling activities are taking place, where buyers and sellers belong to same or nearby villages. These are for perishable items like vegetables.

Tehsil Level Markets: Market catering to buyers and sellers of taluka area. Buyers and seller meet for their stock of food grains and other daily use items.

Regional Level Markets: Usually at district headquarters to cater to a larger area.

National Level: Buyers and sellers world over meet in this market. These are large scale markets and business value and volumes are large. The items transacted include, silver, gold, non-ferrous metals, petro goods and machinery. In the recent past, agricultural commodities have also entered the area.

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2.

Location

Village Market: The transactions between buyer and seller takes place in a small village center called a village market or a Haat. This meet is periodical, usually once or twice a week

Primary Market: The villagers take their agricultural produce to the nearby town or Tehsil on bullock carts, buses or tractors-transaction in the town market takes place between farmers and products.

Wholesale Markets: These markets are located at important commercial centers or district headquarters. The arrivals from villagers and other markets are large in quantities. The transactions take place among villagers, village traders and wholesalers. There are specialized marketing functions that take place in this market. They are commission agents, brokers, packers, weighment etc. These are also called Secondary markets.

Terminal Market: This market caters to the final consumer or processor. These are organized and modern markets. These markets are in cities or state capitals and deal in many commodities.

3.

Volumes of Trade

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Retail Markets: Where goods are brought and sold to consumers based on actual requirements. The retailers purchases goods from the wholesale market and sell in small lots to the nearby consumers.

Wholesale Markets: The wholesale markets are in big cities or commercial centers in a district. The commodities are brought in bit lots bulk and sold in bulk. These markets balance supply and demand fluctuations and also determine the prices of the commodities being transacted. As such wholesale markets are an important part in the market scheme.

4.

Time Span

Short Period Market: These markets are for few hours or a day in a week. Generally perishable goods like vegetables, fruits, milk, fish, mutton are traded. The prices are fixed on the basis of demand pattern.

Long Period Market: Where perishable items for a long period are traded. The items are food grains, oilseeds and oil. The prices are governed by supply as well as demand forces in the market.

Permanent Market: Markets where commodities can be kept for any length of time like machinery, steel furniture, manufactured goods.

5.

Number of Commodities

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General Market: These markets deal in a large number of commodities and of different quality and packages. The items are as groceries, foodgrains, oils, oilseeds, sugar etc.

Specialized Markets: Markets where only one or wo commodities are transacted are called specialized markets. Examples are food grain markets, electrical markets, cotton markets and vegetable markets.

6.

Type of Transactions

Spot or Cash Markets: Where goods are exchanged immediately on payment of cash

Forward Markets: In this market, the timing of exchange of commodity and purchase and sale of that commodity are not same. The goods are delivered at a later date. Sometimes the goods are not delivered at all, only difference being in sales and purchase price which are paid as per agreements.

7.

Degree of Competition

Market are seen from perfect competition to pure monopoly. The markets may exist different intermediate points. The markets are classified on the basis on basis of competition as under:

Perfect Markets: The perfect market in true sense does not exist. This presupposes that

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There are large numbers of buyers and sellers. The buyers and sellers in the market have indepth knowledge of prices, demand and supply.

Price are uniform in a geographical area Plus or minus cost of transportation from surplus to deficit market. Plus or minus cost of storage over a period of time. Plus or minus cost of converting the product from one to another.

Imperfect Markets: In this market, the conditions of perfect market are lacking. These are: Monopoly market where there is only one seller of a commodity. He has sole control. The prices are generally higher. When there is only one buyer, the market is termed as monophony market. Duopoly market is a market there are two sellers of a commodity in the market. Where there are only two buyers in the market, it is called duopsony market. Monopolistic competition: Where a large number of sellers are selling heterogeneous and differentiated forms of a commodity, the situation is termed monopolistic competition. Example farmer has to choose between various makes or brands of pesticides, pumpsets and fertilizers.

8.

Nature of Commodities Commodity Markets: Pertains to the types of goods like grains, cotton, sugar, fertilizers etc.

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Capital Markets: Markets where shares, debentures and bonds are purchased and sold as in share markets.

9.

Government Intervention Regulated Markets: Where markets are controlled by government or statutory rules and regulations, pricing and distribution are as per laid down rules. Unregulated Markets: The seller or trader makes his own rules for conduct of business. These are not government rules for trading. The traders may exploit the situations.

10

Accrual of Marketing Margins

This is done on the basis of whom the marketing goes. These are usually cooperative market. These are prevalent in milk, fertilizer and sugar industries. The margins are distributed to the cooperative members.

11

Type of Population Served Urban Market: Markets to serve the urban population. Rural Market: Markets to meet demands originating from the rural population.

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MARKETING MIX

MARKETING SYSTEM

Marketing activity presently dealt with focused on the commercial transaction between a seller and a buyer. The seller offers his commodities to the buyer to satisfy his needs and wants. The buyer purchases the commodity or services as per his needs and demand.

Marketing Activity and Environment The framework or environment in which marketing activity takes place is within and outside the buyer and seller organizations some are controllable and some are uncontrollable variables. Some variables can be controlled by the seller that is one can plan, organize and perform whereas there are variables which are beyond and control.

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6 Ps of Hospitality: 1. Product:

The tourism product differs from other products due to the wide range it covers, including such areas as accommodations, transportation, food, recreation and attractions. Often the product includes intangibles such as history, culture and natural beauty. Many times the hospitality or tourism product is viewed as more of service in the customers eyes. The closer we can determine how to satisfy the customers needs, the more successful the destination will be.

2. Price

This refers to the amount customers pay for the product or service provided. A quality tourism experience at a fair price is what the customer is looking for in most cases. Pricing should be based upon clear-cut goals and objectives: survival, profit maximization, market share, competition or positioning.

3. Place

The place where the customer buys the tourism product can vary greatly. Travel agents, tour operators and tour wholesalers are a few examples of the distribution points for tourism products. Look for new distribution points in which you can sell your services. Like Hotels, Resort etc.

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4. Promotion

A range of activities can be used to convince customers to buy the product, including information kits, web sites, advertising, personal selling, sales promotion, travel shows, and public relations. Utilize tourist information centers, such as welcome centers. Participation with your state, regional and local tourism offices and associations.

a. Before Inauguration : some of the methods that will be adopted in the promotion of the hotel. before inauguration are i. Advertising : the advertising of the hotel will begin when the project is nearing completion. The different that will be adopted are through local media , national media, bill board and banners. By the appointments of sale executives , VIPs company officials and head of institute can be contacted among with leaflets and folders. ii. Data Base : this is sending personalized letter to executives of certain selected companies all over India . iii. Travel agent : the travel agent operating i the local market and those who passes necessary license to represent the important domestic carries such as Airlines, Railways and road transport are informed to promote the guest into the hotel

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b. After Inauguration : after the inauguration of the hotel the promotion of the hotel can be done by i. Food Festivals : food festivals should be held with wide publicity from time to time ii. Discounts.: certain discount will be given to selected groups like : -Children below the age of 5 - regular guest -Educational tour groups - VVIPS

5. People

The people who sell and service your product are an extremely important part of tourism marketing. Friendly personal service and trained employees can make or break a tourism business. Because much of the tourism industry is based upon word- of-mouth advertising- particularly about the service received- what your customers say after they depart can thrust your business forward or send it into a downward spiral.

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6. Planning

An important part of a viable business plan is to develop a strategic marketing plan in an effort to identify customer expectations. Research and planning also helps design and devise means by which you can meet these expectations. Provides a road map. Is a working document. To be effective the plan must be maintained, reviewed and revised. Should have an annual marketing plan, with a component that mentions long-term goals as well.

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DEMAND QUANTIFICATION Meaning of demand:

The amount of a particular economic good or service that a consumer or group of consumers will want to purchase at a given price. The demand curve is usually downward sloping, since consumers will want to buy as price decreases. Demand for a good or service is determined by many different factors other than price, such as the price of substitute goods and complementary goods. In extreme cases, demand may be completely unrelated to price, or nearly infinite at a given price. Along with supply, demand is one of the two key determinants of the market price.

Types of demand
The different types of demands have been explained below as follows:

Individual demand: It is the quantity of a commodity demanded by an individual consumer at a particular price during a given period of time.

Market demand: It is the total quantity of a commodity demanded by all the consumers in the market during a given period of time.

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Joint demand: When two or commodities are jointly needed to satisfy a single want, then the demand for such goods are said to be joint demand.

Composite demand: When a commodity is demanded for a number of uses, then the demand for that commodity is said to composite in nature. Competitive demand: When two goods are close substitutes of one another, then the demand for such goods is said to be competitive in nature.

Derived demand: When demand for a commodity gives rise to demand for another commodity, then it is said to be as a derived demand.

Variation in demand: It refers to extension or contraction in demand which is exclusively due to change in the price of a product.

Changes in demand: Change in demand refers to increase or decrease in demand which is due to change factors other than price of the commodity.

It refers to some inferior goods which are demanded in smaller quantities when their price falls.

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Direct demand: Goods which yield direct satisfaction to a customer can be termed as the direct demand

Demand for 4 star hotel

Hotel industry is one of the biggest and smokeless industries. Its the form of the hospitality industry. Hotels widely depend upon the nature of the guests. The proposed Hotel Ciel could be classified under 4 star categories, keeping in mind about the demand of rooms, tastes and preferences of guests and the tourist inflow and outflow of the place.

Demand will be based on the average of the existing projects in Faridabad. The no. of rooms and other things will be decided on the average rooms of those projects.

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Name of Hotel

No. of Rooms

Tourist

Others

Business

Occupancy%

Park Plaza

70

34 15 27 30

11 10 25 15

66 60 59 50

64 66 70 60

Sarovar Portico 62 Rajmandir Mahalaxmi 54 62

Average No. of Rooms

70 + 62 + 54 + 62 4

62

Average Tourist clients

34 + 15 + 27 + 30 4

26.5

Average Other Clients

11 + 10 + 25 + 15 4

15.25

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Average Business Clients

66 + 60 + 59 + 50 4

58.78

Average Occupancy%

64 + 66 + 70 + 60 4

65%

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TECHNICAL ASPECTS and MAN POWER PLANNING

TECHNICAL ASPECTS

It is clear from the demand analysis that a hotel with 62 rooms

Hotel Ciel are discussed in this chapter. As the cost involved for the contribution of single room is more or less equal to that of double rooms. Nowadays only double rooms are constructed.

BREAK-UP OF THE ROOM TYPES OF ROOMS DOUBLE SUITE TOTAL NO OF ROOMS 40 22 62

SIZE OF THE ROOM a. Double Room => 15 X 14 =210 sq.ft. Total area of double rooms = 16800 sq.ft. b. Suite => 20 X 16 = 320 sq.ft. Total area of Suite room = 3520 sq.ft. Therefore Total area of room = Area of Double Room + Area of Suite Room =16800 + 3520 =2000 sq.ft

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HOTEL BUILDING Basement

Basement Layout Accounts Department Personal Department Time Office Receiving Area House keeping Fire escape Passage and corridors Laundry Staff cafeteria Locker(male) Locker(female) Stores Purchase department Uniform exchange room Linen exchange room General manager office Engineering and maintenance department Centralized A/C Service lift Security office Square Feet 340 300 200 300 100 200 500 500 800 400 400 400 200 200 700 200 230 700 100 200

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T.V. channel music Total

170 7140 sq. Ft

Ground Floor

Ground floor Reception Reservation Telephone Back office Bell desk Cashier Lobby Travel desk Florists Guest stairs Guest lift Service lift Service stairs Shos\business center Kitchen and room service cabin House keeping pantry

Square feet 700 200 200 300 200 200 1000 330 100 60 70 100 60 600 1000 80

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Setback corridors Fire escape Bar cum restaurant Banquet hall Coffee shop Guest toilet Guest safety locker Health club TOTAL AREA

100 80 1000 1250 750 160 60 640 9240

First floor
First floor Service lift Fire escape Guest stairs Service stairs Guest lift Set back area and corridors House keeping pantry Double room (25) Speciality restaurant Room service TOTAL AREA Square feet 100 80 60 60 70 600 150 11000 1200 140 13460 sq. Ft

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Second Floor

SECOND FLOOR Service lift Fire escape Guest stairs Service stairs Guest lifts Set back areas corridors House keeping pantry Double room(15) Suites(05) Room service pantry TOTAL AREA

SQUARE FEET 100 90 150 60 70 1700 200 6600 3200 190 12360sq. Ft

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Third floor

THIRD FLOOR Service lift Fire escape Guest stairs Service stairs Guest lifts Set back areas corridors House keeping pantry Suites(8) Room service pantry TOTAL AREA

SQUARE FEET 100 80 60 60 70 1500 200 5120 170 7360

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Fourth floor
FOURTH FLOOR Service lift Fire escape Guest stairs Service stairs Guest lifts Set back areas corridors House keeping pantry Suites(9) Room service pantry TOTAL AREA SQUARE FEET 100 80 60 60 70 1910 200 5760 170 8410sq. Ft

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LEGAL REQUIRMENTS
Hotel License: Hotel license is the certificate or document which deals with service where the public are admitted for repose or consumption of any food or drink or any place where food is sold or prepared to sale. Generally following license are required in hotels

1.Labour License -- Labor Office 2.Bar License -- state excise 3.PF Reg. - PF authorities 4.ESI reg - ESI authorities 5.Licence to contractor -- Labor Office

These are licenses has to be take care by HR 01.PF 02.ESI 03.LABOUR LICENSE 04.CONTRACT LICENSE 05.FOOD LICENSE 06.M.C.H LICNESE 07.WIGHTS AND MEASUREMENT LICENSE 08.POLICE LICENSE 09.24HRS COFEE SHOP LICENSE 10.LPG AND DESIGL LICENSE

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11.31ST NIGHT LICENSE 12.ENTERTINEMENT LICENSE 13.AP POLLUSTION CONTROL BOARD LICENSE

1-Service Tax Registration 2-N.O.C from fire department 3-VAT/TIN /C.S.T Registration Certificate 4-C.M.O certificate for food license 5-Training Record of employees shift wise from Fire Department 6-Excise License 7-Luxury Tax registration 8-Paste Control Certificate 9- IATA Approval for tour handling, ticket booking/or agreement with travel & tour company

MANPOWER REQUIREMENT
MANPOWER REQUIREMENTS The success of any service department depends to a large extent on the manpower and the productive of its, work force. Success is personal management might be attached only with good planning. The shift time for the personal hotel will be: Morning shift: 7am to 4pm

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Afternoon shift: 3pm to 12am Night shift: 11pm to 8am The manpower of the hotel will be disturbed as below

Sr. no. 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18.

Description General Manger Assistant manager PA to GM FO Manager Lobby Manager Bell Captain Bell Boys Telephone Operator Telephone Supervisor Front office assistants Executive Chef Sous Chef Chef de Partie Commies F&B Manager Restaurant Manager Banquet Manager Captain

No. of Staff 01 01 01 01 01 01 04 02 01 02 01 02 05 20 01 02 02 04

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19. 20. 21. 22. 23. 24. 25. 26. 27. 28. 29. 30. 31. 32. 33. 34. 35. 36. 37. 38. 39. 40. 41.

Steward Barmen Room service Manager Order Taker Steward room service Executive Housekeeper Assistant Housekeeper Floor Supervisor Linen room supervisor Uniform room supervisor HK Store Supervisor Housemen Gardner Kitchen Stewarding Supervisor Asst KSt Supervisor Pot Washer Chief Engineer Technicians Security Manager Security Personnel Doorman S & M Manager S & M Executives

16 03 01 03 06 01 01 04 04 02 01 15 02 01 01 04 01 05 01 04 02 01 02

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42. 43. 44. 45. 46. 47. 48. 49. 50. Total

Assistants Personnel Manager Asst. Personnel Manager Assistants Accounts Manager Cashier Clerk Purchase Manager Purchase Assistants -

02 01 01 02 01 02 02 01 02 147

PROJECT PROFILE
Name of the industry : 4 Star Business Hotel

Location

: Faridabad

Name of Hotel project

: Hotel Ciel

Room statement

: Total no. Of rooms - 62

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1st floor: Double Rooms - 20

2nd floor: Double Rooms - 25 : Suites - 02

3rd floor: Double Rooms : Suites

-3 -4

4th floor: Double Rooms : Suites

-5 -3

Therefore Land area required is Total build up area Covered land Open area(garden and parking) =25,000sq. Ft. =45,390sq. Ft. =7,800sq. Ft. =5,200sq. Ft.

1. By place I mean that selection of best location for the hotel. The location is considered as one of the most important decision. Considering various barometers. Connected with choosing of the location, a suitable site was finalized.

Hospitality Products Offered

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a. Proposed hotel will recruit professional managers and skilled professionals b. Shall invite the culture of excellent service in the proposed hotel c. Shall provide guest with many cuisines like continental, Chinese ,Awadhi d. Shopping arcade: This is attached to reception counter. It consist of >Travel desk >Handicraft soft >Chemist >Banking facilities >Beauty parlour

e. Business center The hotel provides facilities for : I.FAX II.TELEX III.E-MAIL SERVICE IV.INTERNET V.XEROX

These facilities provide efficient secretarial and other service which can increase the no of business clients.

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e. Lockers: This is to help the guest who are carrying valuable like jewelry, currency or very doc. Etc., to safe guard and prevent theft f. Car Park: This is provided at the side of the hotel about 35-45 cars and 15 wheelers can be asked here .

FOOD AND BEVERAGES OUTLETS OF THE HOTEL

ZAYKA DAWAT E SHAN

24 HOURS COFFEE SHOP Awadhi cuisine specialty restaurant 11 am 3 pm 7 pm 11.30 pm

CHINA STREET

CHINESE SPECIALITY RESTAURANT 11 am 3 pm 7 pm 11.30 pm

ROOM SERVICE KESARIYA MEHFIL ACCELARATE BAR

24 HOURS BANQUET HALL(UP TO 90 PAX) BANQUET HALL(UP TO 300 PAX) 11 am- 11.30 pm

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FACILITIES IN THE ROOM All rooms will have wall-to-wall carpeting. The minimum furniture will be abed, wardrobe, suit case rack, writing desk, chair, sofa set and refrigerator .the suit will have an attached living room with the required furniture provided with refrigerator provided with wine and bar. All rooms wil have channel music ,colour t.v. ,a.c. and a telephone . all rooms will have attached bathrooms with 24 hr hot and cold water supply. The bathroom will also have the required toiletries such as soap, shampoo, toothbrush, paste, shaving kit, hairbrush, powder, towels etc.

Guest stationary and a sewing kit will be provided with special room service menu card, house keeping cards and telephone directory.

In order to ensure price for the products the hotel sells, is has to follow a method of fixing the price .the two methods are a. Follow the leads methods b. Market penetration method In this case market penetration method is used by keeping the price slightly lower than the competition TYPES OF ROOMS NO OF ROOMS

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Double rooms Suite rooms

40 22

A complimentary fruit basket and cookies can be provided for the residential guest. Special service are provided for VIPs and VVIPs

ROOM SERVICE The room service will operate 24 hours. They will have a slightly concise form of the coffee shop menu.

BUSINESS CENTER A well equipped business centre will be incorporated to provide services to all machine, OHP, etc.

FRONT OFFICE As front office is a critical department in a hotel in view of its revenue generating capacity and influencing hotel image. This department will contain a reception, cashier, telephones, bell desk and reservation office.

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LOBBY The lobby will be aesthetically decorated. It will be furnished with sitting arrangement. There will be two elevators in the lobby.

FOOD AND BEVERAGES PRODUCTION This department will handle the production of all F & B items. The food will be nutritionally prepared and aesthetically presented.

HOUSE KEEPING The housekeeping office will be situated in the basement area. This department is very important to upkeep the hotel the hotel. The laundry comes under this department.

PERSONNEL DEPARTMENT This department controls the staff in the hotel and also controls the administration of the hotel. Its office is located in the basement.

ENGINEERING AND MAINTENANCE This department is responsible for the maintenance of furniture, fixture and for rectifying faults in electric equipments, etc. This department will be situated in basement.

ACCOUNTS DEPARTMENT

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This department handles all different accounts of all departments in the hotel and settles them accordingly. This department will be situated in the basement area.

MARKETING GOALS Marketing is an important and integral part of any enterprise. It follows of the organization, that is marketing desires goals from an organization. gives goals of an organization and its marketing arm.

Organization Growth

Marketing Product Sales growth Market development Diversification

Profitability

Maximum sales revenue Maximum contribution

Market Penetration

Market leadership Innovation Consumer satisfaction

Image

Company image Brand image Social image

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Goals of Organization and Marketing

SELLING AND MARKETING CONCEPTS

Selling concept holds that, if left alone, a customer will ordinarily not buy enough products of the organization. the organization must, therefore, go for aggressive selling and invest in promotional campaigns. This is a common mans approach. The aim is to sell what an organization makes rather than make what the market wants.

On the hand, marketing is a business philosophy that is opposed to the selling concept. The marketing concept holds that the key to achieve goals of an organization consists of being effective than its competitors in evolving and executing marketing activities towards determining and satisfying the needs and wants of target markets. The concept is put is few words find wants and fill them or meeting needs profitably. The difference between sell ing and marketing are detailed in below.

Concepts

Starting Points

Focus

Means

End

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The Selling Concept

Factory

Products

Selling and Promoting

Profits through sales through

The Marketing

Target

Customer

Integrated

Profit through

Concepts

Market

Needs

Marketing

Customer Satisfaction

MARKETING PRACTICES

The marketing philosophies have to be put in place by actions for success. These are broadly categorized as: Organization structure and Marketing strategies and leadership.

Organization Structure Each company has its own structure to meet the organizational goals and its target market segment. The approaches are by:

Territory like north, south, east etc. or by states

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Function Subdividing marketing based on functions like advertising, market planning and market research

Product as per product say air conditioners, coolers, washing machine Customer example, kids wear, means wear Markets domestic, export markets Project example, pipeline project, civil construction project and Matrix A multi- product company uses combination of the above to get best results.

CONCLUSION

Tourism is one of the fastest growing and the largest industry in the world. It had tremendous potential for earning foreign exchange. Yielding tax revenue, providing employment and promoting the growth of backward region. The objectives of this report are to find out whether a 4 star hotel will be feasible in Faridabad.

So this project is undertaken to find out the feasibility of the proposed hotel. According to the survey on the demand analysis it has been noted that a 70 room hotel is feasible. Hence a hotel with 62rooms has been proposed. This proposed hotel will be having the best facilities, which are up to the best standards provided in the industry.

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FINANCIAL VIABILITY

TARIFF STRUCTURE

TYPE OF ROOM

SINGLE OCCUPANCY

DOUBLE OCCUPANCY

DOUBLE

2500

2750

SUITES

3600

3650

Note : 1) Service charges of 6% on food and beverage 2) 15 % luxury tax on room All Public Area: Ground Floor All Guest Rooms: 1st, 2nd, 3rd and 4th Floor

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FACILITIES PROVIDED

Restaurant DAWAT E SHAN (Awadhi Cuisine) and MINGS GARDEN (Chinese Specialty) Coffee Shop ZAYKA Bar - ACCELARATE Banquet Hall - KESARIYA, MEHFIL Channel Music System Centralized AC Shopping Arcade Travel Desk Bank Locker Health Club 24 Hours Room Service Cable TV Parking Laundry Double Rooms and Suite Rooms Capsule Elevator

Managing finance is essential for the firms or business concerns , because finance occupies a very important role in any business enterprise. As an entrepreneur he has to have the capacity

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and efficiency in managing different kinds of finance. A complete study of financial management determines the financial viability of an industry with the help of concepts of financial management and the organizer takes the decision for the industry. The decision can be investment decision, financial decision and dividend decision. So far investment decision has been converted to indulge long term and short term investment within the industry. It also includes different types of cost and expenditure.

The financial decision includes the decision pertaining to management of capital during the long run and short run. Thus anytime an industry needs two types of finances: Long term finance Short term finance

Long term finances include borrowing from financial, using funds from share, etc. The short term includes the management of working capital. Analysis has to be made with majority long term finance and short term finance. With regards to this certain management concepts have been used in this project to arrive at the financial viability pertaining to the proposed hotel. The concept used all debt equity ratio, revenue and expenditure, operating profit, return on investment, net cash flow chart determining through making provision for depreciation, taxes, interest on loans, break even analysis, break even percentage to analyze whether the entrepreneur can survive in the business or not. It is not only enough if the entrepreneur manages long term finances but he also has to manage day-today expenditure in his firm. This has to be studied under the concept of working capital management which includes the statement called funds flow statement comprising of sources and

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application of funds. Apart from this, the financial management satisfies the entrepreneur in achieving his target not only in short term but also over a period of time.

With the above said information I would like to determine financial viability of a 4 star hotel in Faridabad called Park Plaza Faridabad. Any firm or industry needs to be studied under the condition of the financial surroundings; financial management plays a very important role in the financial viability of this project. This is possible with reference to the performance of the industry in the revenue earning, expenditure incurring, working, and capital, etc.

Financial management

Is mainly concerned with the procuring funds in the most economic and productive manner deploying the funds in the most profitable way in the given situation , planning, future operation, and controlling current and future performance and development through different tools . the key objective of financial management is to maximize the value of the company regarding the investment, dividend and current assets

Financial decision The decision whether the entire capital should be raised from the equity capital or a part of it is to be raised from loans

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Investment decision It is concerned with how much the company should invest in what project

Current asset management It is necessary for maintenance a balance between current assets and current liabilities.

Dividend decision It is basically a financial decision. This is so because profit is source of fund. The dividend decision is a comprehensive decision between paying reasonable dividend and rating balance profit in revise.

Debt service coverage ratio It is the ratio which shows whether the revenue covered every year after statutory deduction are efficient to service the debt. In other words, if the break even point is not attained its an indication of profitability in the business , such as a situation will have o be maintained for the future year to come.

OPERATIONAL DEFINATIONS

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Cash flow and fund flow statement It refers to the rearrangement of the various financial data as to clearly indicate the various sources from which there is inflow of cash and fangs and the purpose for which they are applied.

Ratios A ratio is a numerical value which exposed in the form of co-efficient percentage or as proposition.

Returns on investments It refers t the ratio which indicates the profit that will be earned every year when compared to the investment in the project

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COST OF PROJECT

ANALYSIS AND INTERPRETATION The current chapter deals with the analysis and interpretation. Financial tools such as ratio analysis, the funds flow statement, the breaker even analysis such similar analytical tools have been made to arrive at a clear and accurate understanding. Facts are observed from the analysis, interrelated descriptively for the understanding of the project concepts The analytical aspects of the project study begins with the cost of the project and means of financial and proceed on with the estimation of revenue and expenditure for six years into the future while also providing a fair understanding of the working capital requirements, to understand the depreciation of fixed assets , the statement of profitability and return on invest and the likes ESTIMATED COST OF PROJECT

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PARTICULARS Cost of land Building and civil work Plant and machinery Furniture and fixtures Miscellaneous fixed assts Margin for contingency Preliminary and pre-operation expenses TOTAL COST OF THE PROJECT

RS. In Lakhs 570.75 288.36 140.85 57.25 13.16 107.037 33.1

1210.50

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SALARY and WAGES

ADMINISTRATIVE General manger Assistant manager PA to General manager 1 1 1

Salary(Rs. Per person ) 50000 32000 19000

Total

101000

Front Office: FRONT OFFICE Front office manager Lobby manager Bell captain Bell boys Telephone operators Telephone supervisor Front office assistant Total 1 1 1 4 2 1 2 12 Salary(Rs.) 28000 20000 10000 7000 8000 7500 19000 99500

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Food and Beverage Production:

FOOD AND BEVERAGE (PRODUCTION)

Salary (in Rs.)

Executive chef Sous chef Chef de Partie Commis Total

1 2 5 20 28

40000 30000 60000 160000 290000

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Food and Beverage Services:

FOOD AND BEVERAGE (SERVICE) F&B manager Restaurant Manager Banquet manger Captains Stewards Barmen Total 1 2 2 4 16 3 25

Salary(Rs.) 30000 40000 36000 34000 120000 18000 278000

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Room Service: ROOM SERVICE Salary(Rs.)

Room service manager

10000

Rom service order taker

19500

Steward

36000

Total

10

65500

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Housekeeping:

HOUSE KEEPING Executive housekeeper Assistant house keeper Floor supervisor Linen room supervisor Uniform room supervisor Housekeeping stores House men Gardeners Total 1 1 4 2 2 1 15 2 28

Salary(Rs.) 22000 18000 40000 20000 18000 8000 105000 8000 239000

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Kitchen Stewarding:

KITCHEN STEWARDING

Salary (Rs.)

Kitchen stewarding supervisor

8500

Assistant kitchen stewarding supervisor

7000

Dish and pot washers

16000

Total

31500

Engineering and Maintainance:

ENGINEERING AND MAINTENANCE Chief engineer Technicians Total 1 5 6

Salary(Rs.) 7500 20000 27500

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Security:

SECURITY Chief security manager Security personnel Door man Total 1 4 2 7

Salary(Rs. ) 6500 22000 10000 38500

Sales and Marketing:

SALES AND MARKETING Sales and marketing manager Executive Assistant Total 1 2 2 5

Salary(Rs.) 14000 20000 16000 50000

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Personnel Department:

PERSONNEL DEPARTMENT

Salary (Rs.)

Personnel Manager

16000

Assistant personnel manager

12500

Assistant

15000

Total

43500

Accounts Department:

ACCOUNTS DEPARTMENT

Salary(Rs. Per person)

Accounts manager

14000

Cashier

20000

Clerks

17400

Total

51400

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Purchase Department:

PURCHASE DEPARTMENT

Salary(Rs. Per person)

Manager

16000

Assistant

18000

Total

34000

TOTAL NO. OF EMPLOYEES = 147

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SALES REVENUE

ESTIMATED SALES REVENUE FOR SIX YEARS

The fooling illustrated table shows the estimation from different sources for the six years of operation under varied occupancy. The revenue generating areas of the hotel are the rooms which give the maximum sales followed by revenue generating areas are the travel desk, book shop, laundry, florist, etc.

70% of the revenue is expected from the rooms, 25% from the F&B outlets and rest 5% from the other revenue generating areas, majority of the revenue approx. 65% comes from the standard rooms and 35% from the suite rooms

SALES REVENUE (IN LAKHS)

Year Occupancy % Double room Suite room Total (a)

1 65 486 79 1099

2 70 522 86 1182 75

3 80

4 85

6 85 729 119 1649

567 93 1283

603 99 1365

648 106 1466

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Coffee shop Specialty Restaurant Bar Banquets Room service Total (b) Laundry Health club Car rental Shopping arcade Business centre Travel desk Others Total (a+b+c)

146.89 144.75

150.32 159.62

152.50 161.8

159.54 165

164.93 169.43

170 171.28

187.71 96.61 63.58 347.9 39.74 15 14.485 13.75 18.06 13.75 15 1518

199.83 108.14 87.24 395.21 49.97 16.9 18.17 14.21 22.17 14.21 16.9 1668

219.17 132.17 105.83 457 59.05 17.93 21.47 14.98 26.84 14.98 17.93 1847

280.34 176.18 169.13 645.45 63.6 18 23.12 15.64 28.91 15.64 18 2125

338.92 265.19 239.28 842.39 65.83 18.47 23.97 16 29.9 16 18.47 2428

392.86 315.23 296.45 1004.54 68.24 19.04 24.78 16.96 30.97 16.97 19.04 2778

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OPERATIONAL EXPENSES

ESTIMATED OPERTAING EXPENDITURE FOR SIX YEARS

The table illustrates different levels of expenditure for the first six years of the operation. The cost revenue ratio is estimated from figures available from the industry. It can be noted that the cost percentage are based on the fourth and sixth year. This is due to the maintenance and refurbishment cost which is expected to occur at the end of this year However, the bank overdraft brings an additional in expenditure for the firm as interest which is payable per annum

YEAR Occupancy ITEM Fuel(1.6 % 0f Total sales) Water(0.75 % of total sales) F&B cost(13% of F&B sales) Telephone(0.8% of total sales) Electricity(0.91% of total sales)

1 60% In lakhs 25.29 11.38 45.53 12.64

2 65%

3 70%

4 80%

5 85%

6 90%

26.68 12.59 51.37 13.34

29.55 13.85 59.41 14.77

34 15.94 83.91 17

38.85 18.21 109.51 19.42

44.45 20.83 130.59 22.22

13.91

15.17

16.80

19.34

22.09

25.27

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Maintenance(1.16% of total sales) Wages( increased by 5% every year) Admn/marketing(1.75% of total sales) Replacement(2.3% of total sales) Repairs (1.03% of total sales) Corporation/Tax(1.23% of total sales) Misc expenses(0.41% of total sales) Total

17.70

19.34

21.43

24.65

28.16

32.22

164

172.2

180.4

188.6

196.8

205

26.59

29.19

32.32

37.19

42.49

48.61

35.41

38.36

42.48

48.87

55.84

63.89

15.71 18.71

17.18 20.15

19.02 22.71

21.88 26.14

25 29.86

28.61 34.17

6.32

6.83

7.57

8.71

9.95

11.38

393.19

421.4

460.3

526.23

595.69

667.24

INTERPRETATION The above table shows the statement of expenditure for six years. This calculation is used to calculate the net expenditure during the year. A certain percentage of sales is taken to calculate the expenditure like fuel, water, telephone, F&B cost, maintenance cost, various taxes, etc., The total of all expenditure is taken and later subtracted with the revenue to get the profitable statement.

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WORKING CAPITAL REQUIREMENT

WORKING CAPITAL REQUIRED FOR SIX YEARS

The working capital funds are planned to be met partly by banks as overdraft and partly by promoters. A months capital requirement for raw material is estimated to be 15% and F&B cost at the corresponding year

The salaries and wages expenditure has o be met by the promoters itself. The liquid cash portion, which is 1 lakh also has to be raised by the promoters fund.

As per recent notification of RBI, the working capital for a unit should be 20 % of total annual sales. Using this norm the working capital required for the first four years of operation is furnished below:

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( in lakhs) Year Sales Working capital (WC) 20% 0f sales Margin money for WC (MM) 20% of WC 1st 1518 303.6 60.72 242.88 Banks finance Wc-mm

2nd

1668

333.6

66.72

266.88

3rd

1847

369.4

73.88

295.52

4th

2125

425

85

340

5th

2428

485.6

97

388.6

6th

2778

555.6

111.12

444.48

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FINANCING THE PROJECT

MEANS OF FINANCE HDFC@ 16% pa SHARE CAPITAL PROMOTORS Government subsidy - 1438.45 lakhs - 221.3 lakhs - 331.95 lakhs - 221.3 lakhs

DEBT= Rs. 1438.45 Lakh (term loan from HDFC)

Equity= (Subsidy+ Unsecured loan+ Promoters Capital)

=(221.3+221.3+331.95) = 774.55

a) Debt Equity Ratio (D.E.R) b) Break Even Point (B.E.P)

: 1438.45: 774.55= 1.85: 1 : 24%

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ESTIMATION OF INCOME

Items Operating levels Room Sales

1st year 65.00%

2nd year 70.00%

3rd year 75.00%

4th year 80.00%

5th year 85.00%

1099

1182

1283

1365

1466

F & B Sales

323.93

394.28

469.02

550.08

634.91

General Stationery In-house service Health Club

2.40

2.40

2.50

2.70

2.76

38.32

43.21

49.64

56.65

63.80

29.20

35.51

43.80

53.33

60.22

Total In Lakhs

1492.8

1657.2

1848

2027.76

2227.6

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PROFITABILITY STATEMENT
STATEMENT OF PROFIT PROFITABILITY AND CASH FLOW

Items Operating profit Interest on long term loan

1st year 1265.04

2nd year 1268.22

3rd year 1288.63

4th year 1477.42

5th year 1733.34

6th year 2034.6

230.18

191.68

153.38

115.02

76.67

38.2

Depreiciation 77.66 chap- XII Preoperative & preliminary expenses written off Interest on Unsecured Loan 44.26 41.38

58

45.65

36.14

29.68

25.04

41.38

41.38

41.38

41.38

41.38

35.4

28.32

22.56

18.14

14.5

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Profit before tax Tax 40% Surcharge (8%)

868.94

938.7

958.48

1280.74

1562.68

1910.41

347.58 27.8

375.48 30.03

383.29 30.67

512.29 40.98

625.07 50

764.16 61.13

Profitable tax 549.16 Depriciation 77.66

593.25 58

605.86 45.65

809.43 36.14

987.61 29.68

1207.38 25.04

Preoperative & preliminary expenses Available surplus Long term loan instalment Unsecured loan

41.38

41.38

41.38

41.38

41.38

41.38

668.2

692.63

693.1

886.95

1058.67

1273.8

230.18

191.68

153.37

115.02

76.67

38.2

44.26

35.4

28.32

22.56

18.14

14.5

112 | P a g e

Net cash flow

393.76

465.55

511.41

749.37

963.86

1221.1

This table illustrates the profits and also the cash position at the end of the year. Depreciation in all fixed assets is calculated by diminishing the value method ( W D V- Written Down Value Method). This is written off at the rate of 15% per annum on building and structures, 33.3% per annum on miscellaneous fixed assets. The term loan and unsecured loans are to be paid back in 7 years after starting the operations, owing to fluctuating occupancy rates and expenditure levels, by which time the business is expected to have stabilized. The balance amount would be paid back in the following years by which time the business would be stabilized. The income tax payable is 40% on profit before tax with 8% surcharge on tax. The preliminary and pre-operative expenses made during construction period is to be written off in the first 10 years of operation. A higher degree of depreciation and interest rates cause a project loss in revenue and due to this, income tax and profit before tax are the loss in the first year. On the other hand the depreciation that is accounted does not affect the fund position. All these results in a higher level of net cash flowing in the first year.

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CASH FLOW STATEMENT

Source of find Constructio 1st year n (3 year period) 2nd year 3rd year 4th year 5th year

Promoters contribution

331.95

Long term loan

1438.45

Share capital

221.3

Govt subsidy

221.3

Gross profit Depreciation Preoperative & preliminary exp.

393.76 77.66 41.38

465.55 58 41.38

511.41 45.65 41.38

749.37 36.14 41.38

963.86 29.68 41.38

Total in Lakhs

2213

512.8

564.93

598.44

826.89

1034.92

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COST BENEFIT ANALYSIS

Cost benefit analysis

Total fixed assets

=Rs. 2079.27

Add: - total working capital

=Rs. 1233.64

TOTAL (A)

=Rs. 3312.12

Total sales for 6 years= Rs. 12364 lac Less:- a) Cost of F & B expenses (for 6 years) b) Cost of fuel (for 6 years) c) Cost of power (for 6 years) Total Rs. 5173.04 Rs. 345.18 Rs. 431.5 Rs. 5949.72

TOTAL(B)= Sales (a+b+c)= 6414.28

C. Capital intensity of a project C= B/A = 6414.28/3312.12= 1.94

MORE THAN 1 IS BENEFICIAL FOR THE ECONOMY LESS THAN 1 IS NOT BENEFICIAL FOR THE ECONOMY

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BREAKEVEN ANALYSIS

It is a study of cost revenue and sales. It finds out the volume of sales required by the firm cost and revenue to be equal. The break even point is the point when the net incomes zero. It is a situation of no profit and no loss.

The Break even analysis explains to us the relationship between cost revenue and output that helps a firm sell to its full competence. This analysis forms an important bridge between the plans of the firm and business behavior.

LIMITATIONS OF BREAK EVEN ANALYSIS

This analysis has a number of limitations as the data collected is not on the cost and revenue functions. The limitations are as follows:-

If in static, everything is sold at constant selling price but in reality larger volumes may not be sold at same price. The way future is projected with the part is not correct.

116 | P a g e

Factors like technological changes, improved management have been overlooked. The cost revenue output relation is linear which is true for a small volume of output. Assumed for the 3rd year operation occupancy= 75%

1.

Estimated revenue:

1848 (Rs. In Lakhs)

2. a)

Fixed costs ( fixed overheads): Power 40% : 45.28 153.38 1.77 45.65 88.54 17.71 370.04 17.71

b) Salaries and wages : c) Interest on long term loan: d) Insurance and legal exp. : e) Depreciation :

f) Advertisement and publicity: g) Administration & general expenses: Total

3. Variable Cost: a) Raw material : 187.60

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b) Electricity and power 60% c) Repairs and maintenance d) Interest on working capital e) Misc expenditure

28.40 10.00 3.54 50.00 279.54

Total

4. CONTRIBUTION TOWARDS OVERHEADS = Income- Variable Cost =1848-279.54= 1568.5

5. BREAKEVEN POINT = [Fixed overheads/Contribution] x 100 = [370.04/1568.5] x 100 =24 % 6. ABSOLUTE BREAKEVEN POINT = [Breakeven point x % of occupancy] / 100 = 18

7. BREAKEVEN TURNOVER = [estimated revenue x absolute breakeven] / 75 = 443.52 (Rs. in lakhs)

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DEBT SERVICE COVERAGE RATIO:

DEBT SERVICE COVERAGE RATIO (DSCR) for the year is calculated by dividing the total coverage including tax, depreciation, preliminary and pre-operative expenses by the total debt from first year to sixth year. The average DSCR is calculated by dividing the total of all debt ratios by six. Thus average DSCR comes out to be:

Coverage-A

1st year

2nd year 593.25

3rd year 605.86

4th year 809.43

5th year 987.61

6th year 1207.38

Profit before 549.16 tax Depreciation 77.66 Interest on long term loan Preliminary and preoperative expenses Total 898.38 41.38 230.18

58 191.68

45.65 153.38

36.14 115.02

29.68 76.67

25.04 38.2

41.38

41.38

41.38

41.38

41.38

884.31

846.27

1001.97

1135.34

1312

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Coverage B Interest on long term loan Installment on long term Total

1st year

2nd year

3rd year

4th year

5th year

6th year

230.18

191.68

153.38

115.02

76.67

38.2

239.7

239.7

239.7

239.7

239.7

239.7

469.88

431.38

393.08

354.72

316.37

277.9

Average DSCR = Coverage A- Coverage b = 6078.27/ 2243.33= 2.7

It is more than one so it is beneficial.

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SENSITIVITY RATIO

Sensitivity Ratio

A. Change in income for 1% change in occupancy = income (3rd year)/ occupancy (3rd year) = 1847.0/ 70 = 26.38

B. Change in cost for 1% change in occupancy = variable cost (3rd year)/ Occupancy (3rd year) =558.37/ 70 =7.97

C. Sensitivity in income for 1% change in occupancy =A/ B = 26.38/ 7.9 = 3.3

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CONCLUSION

The total cost of the project is estimated at Rs. 1210. 50 lakhs. There are 62 rooms out of which 40are double rooms and 22 are suite rooms. The hotel also provides facilities like coffee shop, conference hall, specialty restaurant, bar, travel desk, etc.

The estimated income and expenditure have been arrived by keeping in view the economic cost in which service can be offered to the prospective customer. The debt equity ratio is 1:85:1 a well combination of debt and equity finance. The ratio of depreciation of assets and preliminary and preoperative expenses has been kept down fairly reasonable limit, which should prove to be satisfactory.

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BIBLIOGRAPHY

Books 1. Khurana R. & Ravichandran A.N. Strategic Marketing Management: Concepts and Class (1995), Global Business Press, New Delhi. 2. Reich A.Z., Marketing Management for the Hospitality Industry: A Strategic Approach (1997), John Wiley & Sons Inc., New York. 3. Porter, M.E. Competitive Strategy. Techniques for and analyzing industries and competitors (1980), New York, Free Press, pp. 89, 149. 4. Abbott P. and Lewry S. (1991), Front Office: Procedures. social skills and management. Butterworth Heinemann. 5. Coltman, M. (1991), Financial Control for your Hotel. John Willey & Sons, Inc. 6. Kasavana M. and Brooks R. (1995), Managing Front Office Educational Institute. Operations. Fourth Edition,

123 | P a g e

Websites www.fhrai.com www.hotelinteractive.com www.thomsonlearning.co.uk www.hcima.com www.ehotelier.com www.hotelier&caterer.com www.fooddude.com www.biz.yahoo.com www.restaurant.org www.hotel-online.com www.cio.com www.entrepreneur.com www.mckinseyquarterly.com

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ANNEXURE

ANNEXURE

Cost of Land = Land Required in Sq ft X Rate per Sq ft

= 25,000Sq.ft X 2,000Sq.ft

= Rs.500 lakhs

10% for Conveyance

=Rs.50 lakhs

4.15% for Site Development = Rs.20.75 lakhs

Total

=Rs.5, 70, 75,000

=Rs.570.75 lakhs

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COST OF BUILDING

DESCRIPTION Total Built up Area (Sqft)

AMOUNT 57970 sq. ft.

Rate/Sq ft

400/ sq. ft.

Cost

231,88,000

15% of Electrical Work 34,78,200

4.36% on Plumbing & Drainage

101,09,97

5% on Consultant

11,59,400

Total

28836597 (Rs.)

Therefore the cost of building is Rs 288.36 lakhs.

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PLANT & MACHINERY

Items

Cash in lakhs

Central Air Conditioner

17.725

Elevators

12.475

Generator

16.7375

Transformer

16.475

Bore Well

8.00

Boiler

14.475

EPABX

5.75

Instruments

6.7375

Exhaust & Ventilation

11.00

Close Circuit Television

7.00

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Kitchen Equipment

15.475

Fire Fitting

9.00

Total

140.85

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FURNITRE and FIXTURE:

GUEST ROOMS & SUITES

Items

Price(Rs/ piece)

Nos.

Total (in Lakhs)

Twin Bed

5,000

11

0.55

Double Bed

11049

51

5.6349999

Side Table

1841

135

2.4856

Chairs

1860

100

1.86

Coffee Table

3180

84

2.672

Cupboard

3333

84

2.8

Luggage Rack

4004

62

2.4823

Magazine Rack

3358

62

2.082

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T.V. Stand Carpet

2984 4839

84 62

2.50623 3.00

Mirror Washbasin Bathtub Water Closet

1038

124

1.287

13515

62

8.379203

Upholstery

3000

124

3.3306666

Dressing Table

3965

84

2.95

Fixtures

3.00

Total

45.02

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FOOD & BEVERAGES OUTLET

RESTAURANT

Items

Price

Nos.

Total

Tables

2461

13

0.32

Chairs

646

52

0.336

7500 Side Station Dcor & Upholstery 35600

0.30

All Inclusive

0.356

Fixtures

32800

All Inclusive 1

0.328

Music system

25,000 1

0.25

Bar counter

40600

0.406

Total

2.30 lakhs

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ROOM SERVICE Item Price (RS) Nos Total (Lakhs)

Breakfast Trays Tea Trays 12 Salvers 9 salvers Trolleys Racks Order-Taker Cabin, Desk

266 160 266 208 1530 2680 7120

20 30 15 10 4 3 1

0.0532 0.048 0.040 0.0208 0.0612 0.0804 0.0712

Misc TOTAL

3000

0.030 0.405

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BANQUET / CONVENTION HALLS

Item Tables Chairs Carpet Podium P A system 12 salvers Fixtures and Upholstery

Price (RS) 3000 100 3000 2000 7000 666

Nos 100 300 4 2 1 12

Total (Lakhs) 3.0 3.0 0.12 0.04 0.070 0.08 0.406

TOTAL

6.716

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STORES, PURCHASE AND HOUSE KEEPING

Item

Price

No.

Total (Lakhs)

Cupboard Racks Shelves Bins Fixtures

3000 2500 2500 1000 ---

6 5 8 6

0.18 0.125 0.20 0.06 0.18

TOTAL ADMINISTRATION

0.823

Item

Price

No.

Total (Lakhs)

Tables

3000

0.15

Chairs

1000

15

0.15

Fixtures

---

---

0.08

TOTAL

0.38

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RECEPTION AND LOBBY

Item Counter Sofa Set Luggage Carrier Stationary Safe Deposit Cup Board Fixtures Miscellaneous TOTAL

Price 3500 9000 6000 --2000 10000 -----

No. 6 3 1 --1 1 -----

Total (Lakhs) 0.21 0.27 0.060 0.13 0.02 0.10 0.18 0.10 1.07

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STAFF CAFETERIA

Item

Price

No.

Total (Lakhs)

Tables and chairs (attached benches) Fixtures

3000

15

0.45

---

---

0.09

TOTAL

0.54

Grand Total = 57.254

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MISCELLANEOUS FIXED ASSETS

F&B Outlets RESTURANT/BAR Item Price (RS) No. (Inc Par Stock) Total (Lakhs)

Table Cloth

250

39

0.078

Napkins

60

156

0.022

TOTAL

0.10

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BANQUETS/ CONFERENCE

Item

Price (Rs)

Nos (Inc Par Stock)

Total (Lakhs)

Table Cloth

300

150

0.5

Napkins

60

600

0.132

Frills

400

150

0.316

TOTAL

0.95

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GUEST ROOM / SUITE ROOM LINEN Item Price (Rs) No. (Inc Par Stock) Double Bed Sheet Single Bed Sheet Blankets Blanket Cover Mattress Mattress Protector Bed Covers (single, double) Pillow Cover Hand Towel Bath Towel Bath Mat Feather pillows TOTAL 195 375 543 543 218 200 80 80 80 200 0.39 0.30 0.435 0.435 0.435 6.01 2250 1371 1160 556 1,112 605 604 35 20 62 72 72 72 72 0.48 0.45 0.58 0.40 0.80 0.435 0.435 Total (Lakhs)

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KITCHEN STEWARDING

Item

Price per set (Rs)

No (sets)

Total (Lakhs)

Glasses

80

250

0.20

Chinaware

140

200

0.28

Cutlery

72

250

0.18

Flat Ware

120

200

0.24

Miscellaneous

---

0.03

TOTAL

1.2

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BANQUETS

Item

Price per set (Rs.)

No. (sets)

Total (Lakhs)

Glassware

224

250

0.56

Chinaware

253

300

0.76

Cutlery

133

300

0.40

Flat Ware

150

400

0.60

Miscellaneous

---

---

0.58

TOTAL

2.904

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STAFF CAFETERIA

Item

Price (RS)

No.( per set)

Total ( Lakhs)

Plates

350

120

0.42

Spoons

127

150

0.19

Forks

126

150

0.19

TOTAL

0.8

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MISCELLANEOUS HOUSEKEEPING ASSESTS

Item Vacuum Cleaner Cleaner Mug Mops Brooms Squeezer Duster Waiters Cloths Miscellaneous TOTAL

Price (Rs) 3000 2000 150 70 80 10 10 ---

Nos 3 4 10 10 10 100 100 ---

Total (Lakhs) 0.30 0.10 0.20 0.18 0.12 0.075 0.15 0.075 1.2

Grand Total: 13.16

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MARGIN OF CONTINGENCY

1. Cost of Land 2. Cost of Building 3. Plant and Machinery 4. Furniture and Fixture 5. Miscellaneous Fixed Assets

= = = = =

570.75 288.36 140.85 57.25 13.16

Margin of Contingency = 10% on 1-5

107.03

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PRELIMINARY AND PRE-OPERATIVE EXPENSES

Item Salary and Wages Loan Procurement and Application Project Fee Registration and Establishment Fees Insurance Advertisement and Publicity Deposits 1. Electricity 2. Telephone 3. Water supply Miscellaneous Expenses and Contracts TOTAL

Amt (lakhs) 13.70 2.25 5.00 4.25 3.00

1.00 1.50 1.00 1.40 33.1

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MANPOWER REQUIREMENT AND COST

SALARY &WAGES (YEARLY)

Sr. no.

Description

No. of Staff

Amount

Total In lakhs

51.

General Manger

01

50,000

52.

Assistant manager

01

32,000

3.84

53. 54. 55. 56. 57. 58.

PA to GM FO Manager

01 01

19,000 28,000 20,000 10,000 28,000 8,000

2.28 3.36 2.4 1.2 3.36 0.96

Lobby Manager 01 Bell Captain Bell Boys Telephone Operator 01 04 02

59.

Telephone Supervisor

01

7,500

0.90

60.

Front office

02

19,000

2.28

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assistants 61. 62. 63. 64. 65. 66. Executive Chef Sous Chef Chef de Partie Commies F&B Manager Restaurant Manager 67. Banquet Manager 68. 69. 70. 71. Captain Steward Barmen Room service Manager 72. 73. Order Taker Steward room service 74. Executive Housekeeper 75. Assistant Housekeeper 76. Floor 04 40,000 4.8 01 18,000 2.16 01 22,000 2.64 03 06 19,500 36,000 2.34 4.32 04 16 03 01 34,000 1,20,000 18,000 10,000 4.08 14.4 2.16 1.20 02 36,000 4.32 01 02 05 20 01 02 40,000 30,000 60000 1,60,000 30,000 40,000 4.8 3.6 7.20 19.2 3.6 4.8

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Supervisor 77. Linen room supervisor 78. Uniform room supervisor 79. HK Store Supervisor 80. 81. 82. Housemen Gardner Kitchen Stewarding Supervisor 83. Asst KSt Supervisor 84. 85. 86. 87. Pot Washer Chief Engineer Technicians Security Manager 88. Security Personnel 89. 90. Doorman S&M 02 01 10,000 14,000 1.2 1.68 04 22,000 2.64 04 01 05 01 16,000 7,500 20,000 6,500 1.92 0.90 2.4 0.78 01 7,000 0.84 15 02 01 1,05,000 8,000 8,500 12.6 0.96 1.02 01 8,000 0.96 02 18,000 2.16 04 20,000 2.4

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Manager 91. S&M Executives 92. 93. Assistants Personnel Manager 94. Asst. Personnel Manager 95. 96. Assistants Accounts Manager 97. 98. 99. Cashier Clerk Purchase Manager 100. Purchase Assistants Total 147 164.448 02 18,000 2.16 02 02 01 20,000 17,400 16,000 2.4 2.088 1.92 02 01 15,000 14,000 1.8 1.68 01 12,500 1.5 02 01 16,000 16,000 1.92 1.92 02 20,000 2.4

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INCOME FROM TARIFF

DOUBLE ROOM

Year

Room Tariff

Occupancy

Days/Year

Total (Lakhs)

2500

65%

365

367.73

II

2500

70%

365

396.02

III

2500

75%

365

424.31

IV

2500

80%

365

452.6

2500

85%

365

480.88

VI

2500

85%

365

480.88

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SUITE ROOM

Year I II III IV V VI

Room Tariff 3600 3600 3600 3600 3600 3600

Occupancy 65% 70% 75% 80% 85% 85%

Days/Year 365 365 365 365 365 365

Total (Lakhs) 529.54 570.27 611.01 651.74 692.47 692.47

Room Sales I YEAR IIYEAR IIIYEAR IV YEAR V YEAR VI YEAR = = = = = = Rs.897.27 Rs.966.29 Rs.1035.32 Rs.1104.34 Rs.1173.35 Rs.1173.35

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REVENUE FROM F & B OUTLETS

RESTAURANT/ BAR Average Year Total Covers Occupancy realization per cover No of days per year Total (Lakhs)

150

65%

400

365

142.35

II

150

70%

400

365

153.3

III

150

75%

400

365

164.25

IV

150

80%

500

365

219

150

85%

500

365

232.68

VI

150

85%

500

365

232.68

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COFFEE SHOP Average Year Total Covers I 180 65% Occupancy realization per cover 700 365 No of days per year Total (Lakhs) 298.93

II

180

70%

700

365

321.93

III

180

75%

700

365

344.92

IV

180

80%

750

365

394.2

180

85%

800

365

446.76

VI

180

85%

800

365

446.76

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BANQUET

Average Year Total Covers Occupancy realization per cover

No of days per year Total (Lakhs)

300

65%

900

365

640.57

II

300

70%

900

365

689.85

III

300

75%

900

365

739.12

IV

300

80%

950

365

832.2

300

85%

1000

365

930.75

VI

300

85%

1000

365

930.75

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F&B Sales

I YEAR IIYEAR IIIYEAR IV YEAR V YEAR VI YEAR

= = = = = =

Rs.1081.85 Rs.1165.08 Rs.1248.29 Rs.1445.4 Rs.1610.19 Rs.1610.19