Solar LED Lighting System

Solar LED Lighting System

2008

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Table of Contents
Executive Summary ....................................................................................................................................... 3
Introduction .................................................................................................................................................. 4
Technical Analysis ......................................................................................................................................... 5
LED Light .................................................................................................................................................... 5
Solar Energy .............................................................................................................................................. 7
Our Technology ......................................................................................................................................... 8
Life Cycle Cost Analysis ............................................................................................................................. 8
How bright is it? .................................................................................................................................... 8
Economic Analysis ....................................................................................................................................... 10
Marketing Analysis ...................................................................................................................................... 13
Product Analysis .......................................................................................................................................... 17
.................................................................................................................................................................... 18
Marketing Plan ............................................................................................................................................ 21
Promotion ............................................................................................................................................... 21
Distribution ............................................................................................................................................. 22
Operational Plan ......................................................................................................................................... 23
Management ............................................................................................................................................... 24
Economic Justification ................................................................................................................................ 25
Project Cost ............................................................................................................................................. 25
Projected Profit & Loss Statement .......................................................................................................... 26
Projected Balance Sheet ......................................................................................................................... 27
Cash Flow Statement .............................................................................................................................. 28
Assumptions Underlying Financial Statements ...................................................................................... 29
Sales Forecast ...................................................................................................................................... 29
Cost of Sale Scedule ............................................................................................................................ 29
Schedule of Expenses .......................................................................................................................... 30
Inventory Schedule ............................................................................................................................. 30
Product Wise Price & Cost .................................................................................................................. 31
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Executive Summary

Name : M/S Solar Gen Limited (Proposed)
Legal Status : Unquoted Public Limited Company
Business : Solar + LED Based Lighting Solution
Type of Business : Service
Project Cost : PKR 1.382 Million
Financing : 100% Equity
Breakeven Point : Net Sales of PKR 7.752 Million
: 63.28 % of First Year’s projected sales
Summary of Financials
Profit & Loss Statement
Particulars Year1 Year2 Year3 Year4 Year5
Sales 12,250 13,475 16,170 20,950 29,000
Net Profit / (Loss) 642 707 971 1,518 2,516

Balance Sheet
Assets
Total 2,023 2,730 3,702 5,220 7,736
Capital & Liabilities
Equity 1,382 1,382 1,382 1,382 1,382

Retained Earnings 642 1,349 2,320 3,838 6,354
Total 2,024 2,731 3,702 5,220 7,736

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Introduction
This project envisages the establishment of a company under the name & style of M/S Solar Gen Limited
‐ (Proposed). The company shall provide lighting solutions to households, offices, local government for
lighting parks, streets and highways. The company shall provide lighting solution based on solar energy
and SSL – solid state lights – LED.
Light Emitting Diode ‐ LED as commonly known is a revolution in lighting. LEDs are small, solid light
bulbs, which are extremely energy‐efficient. Until recently, LEDs were limited to single‐bulb use in
applications such as instrument panels, electronics, pen lights and, more recently, strings of indoor and
outdoor decorative lights. Recent improvements in manufacture have lowered the cost of LEDs, which
has expanded their application. The bulbs are now available in clusters, and are popular especially for
battery powered items such as flashlights and headlamps. LEDs are also available in arrays which fit
standard AC and DC receptacles, lamps, recessed and track lights.

Benefits:
Long‐lasting ‐ LED bulbs last 10 times as long as compact fluorescents and 133 times longer than typical
incandescent.
Durable ‐ Since LEDs do not have a filament, they are not damaged under circumstances when a regular
incandescent bulb would be broken. Because they are solid, LED bulbs hold up well to jarring and
bumping.
Cool ‐ these bulbs do not cause heat build‐up; LEDs produce 3.4 Btu’s/hour, compared to 85 for
incandescent bulbs.
Energy‐saving ‐ LEDs use a fraction of the wattage of incandescent bulbs. Batteries will last 10 to 15
times longer than with incandescent bulbs. Also, because these bulbs last for years, energy is saved in
maintenance and replacement costs.
Light for remote areas ‐ because of the low power requirement for LEDs, using solar panels becomes
more practical and less expensive than running an electric line or using a generator for lighting.

Challenges
Cost ‐ although the cost keeps going down, LEDs are still expensive. A single AC bulb (30 LED), replacing
a 25 watt incandescent, may cost about Rs. 480/=.
Light Field ‐ LEDs are focused lights, and therefore are best as task specific lighting such as reading
lights, desk lamps, night lights, spotlights, security lights, signage lighting, etc. They do not radiate light
in 360 degrees as an incandescent does. The light will be bright where you point it towards.

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Technical Analysis
LED Light
A Light Emitting Diode (LED) is a semiconductor device which converts electricity into light. Each diode is
about 1/4 inch in diameter and uses about ten milliamps to operate at about a tenth of a watt. LEDs are
small in size, but can be grouped together for higher intensity applications. LED fixtures require a driver
which is analogous to the ballast in fluorescent fixtures. The drivers are typically built into the fixture
(like fluorescent ballasts) or they are a plug transformer for portable (plug‐in) fixtures. The plug‐in
transformers allow the fixture to run on standard 120 volt alternating current (AC), with a modest
(about 15 to 20 percent) power loss.
The efficacy of a typical residential application LED is approximately 20 lumens per watt (LPW).
Incandescent bulbs have an efficacy of about 15 LPW and compact fluorescents (Energy saver Bulbs) are
about 60 LPW, depending on the wattage and lamp type.
LEDs are better at placing light in a single direction than incandescent or fluorescent bulbs. Because of
their directional output, they have unique design features that can be exploited by clever designs. LED
strip lights can be installed under counters, in hallways, and in staircases; concentrated arrays can be
used for room lighting. Waterproof, outdoor fixtures are also available. Some manufacturers consider
applications such as gardens, walkways, and decorative fixtures outside garage doors to be the most
cost‐efficient.
LED lights are more rugged and damage‐resistant than compact fluorescents and incandescent bulbs.
LED lights don't flicker. They are very heat sensitive; excessive heat or inappropriate applications
dramatically reduce both light output and lifetime. Uses include:
 Task and reading lamps
 Linear strip lighting (under kitchen cabinets)
 Recessed lighting/ceiling cans
 Porch/outdoor/landscaping lighting
 Art lighting
 Night lights
 Stair and walkway lighting
 Pendants and overhead
 Retrofit bulbs for lamps
Attributes
Individual LEDs are considerably more efficient; however, the lamp or fixture design is reduced by the
driver and electronics. In addition, LEDs do not produce heat like incandescent bulbs.
LEDs last considerably longer than incandescent or fluorescent lighting. LEDs don't typically burn out
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like traditional lighting, but rather gradually decrease in light output. Their "useful life" is defined by
the Alliance for Solid‐State Illumination Systems and Technologies (ASSIST) as the time it takes until
70% of initial light output is reached, often 50,000 hours. They are resistant to thermal and vibrational
shocks and perform well when subjected to frequent on‐off cycling.
Source – US Department of Energy
No additional tools or training are required for installation of LED fixtures.
Initial Cost
The biggest limitation to LED for common residential use is the cost of manufacturing due to still‐limited
production runs. Manufacturers claim production will increase considerably in the near future, further
lowering prices. Currently, there is a limited number of LED fixture manufactures, but this is changing.
Retrofit bulbs range from Rs. 200/= to Rs. 850/= for night lights and small lamps.
Operational Cost
The cost savings of LEDs can be found in smaller wattage lamps or for applications that take advantage
of their longevity, such as difficult to reach places. They are also advantageous for dimmable fixtures,
since dimmable fluorescents are expensive.
Installation
The small size of LED lights encourages a variety of design options. White LED lamps are available with
Edison (screw‐in type) bases to retrofit existing fixtures. There are LED strips that can be used under
cabinets. In addition, outdoor landscaping fixtures are available.

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Benefits/Costs
LED lamps have many advantages over traditional lighting methods. These include:
 Low energy consumption – retrofit bulbs range from 0.83 to 7.3 Watts
 Long service life – LED bulbs can last up to 80,000 hours
 Durable – LED bulbs are resistant to thermal and vibrational shocks and turn on instantly from ‐
40C° to 185C°, making them ideal for applications subject to frequent on‐off cycling, such as
garages and basements
 Directional distribution of light – good for interior task lighting
 No infrared or ultraviolet radiation – excellent for outdoor use because UV light attracts bugs
 Safety and environmentally conscious – LEDs contain no mercury and remain cool to the touch
 Fully dimmable – LEDs do not change their color tint when dimmed unlike incandescent lamps
that turn yellow
 No frequency interference – no ballast to interfere with radio and television signals
 Range of color – LEDs can be manufactured produce all colors of the spectrum without filters,
they can also produce white light in a variety of color temperatures
There are some current disadvantages to LED lighting:
 LEDs are currently more expensive than more conventional lighting technologies, and may be
hard to locate
 LED is very heat sensitive. Excessive heat or inappropriate applications dramatically reduce both
light output and lifespan
 LEDs typically cast light in one direction at a narrow angle compared to incandescent or
fluorescent lamps so lenses or reflectors are needed in fixtures to broaden the beam (if desired)
Solar Energy
A solar cell or photovoltaic cell is a device that converts solar energy into electricity by the photovoltaic
effect. Photovoltaic is the field of technology and research related to the application of solar cells as
solar energy. Sometimes the term solar cell is reserved for devices intended specifically to capture
energy from sunlight, while the term photovoltaic cell is used when the source is unspecified. Solar cells
have many applications. Individual cells are used for powering small devices such as electronic
calculators. Photovoltaic arrays generate a form of renewable electricity, particularly useful in situations
where electrical power from the grid is unavailable such as in remote area power systems, Earth‐
orbiting satellites and space probes, remote radiotelephones and water pumping applications.
Photovoltaic electricity is also increasingly deployed in grid‐tied electrical systems.
Solar cells are often electrically connected and encapsulated as a module. PV modules often have a
sheet of glass on the front (sun up) side, allowing light to pass while protecting the semiconductor
wafers from the elements (rain, hail, etc.). Solar cells are also usually connected in series in modules,
creating an additive voltage. Connecting cells in parallel will yield a higher current. Modules are then
interconnected, in series or parallel, or both, to create an array with the desired peak DC voltage and
current.
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The power output of a solar array is measured in watts or kilowatts. In order to calculate the typical
energy needs of the application, a measurement in watt‐hours, kilowatt‐hours or kilowatt‐hours per day
is often used. A common rule of thumb is that average power is equal to 20% of peak power, so that
each peak kilowatt of solar array output power corresponds to energy production of 4.8 kW∙h per day.
To make practical use of the solar‐generated energy, the electricity is most often fed into the electricity
grid using inverters (grid‐connected PV systems); in standalone systems, batteries are used to store the
energy that is not needed immediately.
A number of detailed studies on the energy requirements on the three types of photovoltaic (PV)
materials, which make up the majority of the active solar market: single crystal, polycrystalline, and
amorphous silicon were reviewed. It was found that modern PV cells based on these silicon technologies
pay for themselves in terms of energy in a few years (1‐5 years). They thus generate enough energy over
their lifetimes to reproduce themselves many times (6‐31 reproductions) depending on what type of
material, balance of system, and the geographic location of the system. It was found that regardless of
material, built‐in PV systems are a superior ecological choice to centralized PV plants. Finally, the results
indicate that efficiency plays a secondary role to embodied energy in the overall net energy production
of modern solar cells.
Our Technology
The company is in active negotiation with Shanghai Kepsun Optoelectronics Co. Ltd, China for technical
collaboration. Shanghai Kepsun manufactures variety of LED products such as street lights, daylight
lamps, bulbs, spotlights, flood lights, and tunnel lights in different designs. These lights can be used
through existing mains AC 220V power outlet or through solar charged batteries using 12V DC input. We
are concentrating on solar powered lights. This technology depends on three items viz. (1) LED light (2)
Solar panel and (3) Solar controller. Solar cell or solar panel is used to charge the re‐chargeable battery
that provides 12V DC to bulb for lighting purpose and solar controller is used to manage the charging of
battery.
Life Cycle Cost Analysis
Life cycle cost analysis has been done using data of incandescent bulb, compact fluorescent bulb, and
LED bulb. Incandescent bulb is the conventional bulb of Edison era. Whereas compact fluorescent light
bulb is in vogue as energy efficient light commonly known as “Energy Saver”. LED – Light Emitting Diode
light bulb a new revolution in light that the company is pursuing. The comparison is based on a normal
household lighting requirement and equivalent lumens produced by each type of light.
How bright is it?
How do we compare the brightness of Compact Fluorescent Light (“CFL”) bulbs to incandescent
lights? Energy efficiency of light sources is typically measured in lumens per watt (lm/W), meaning the
amount of light produced for each watt of electricity consumed. This is known as luminous efficacy.
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Source – US Department of Energy

Analyzing data provided by various manufacturers of LED lights shows that a 13 watt CFL with the
brightness of a 60 watt incandescent bulb is a “60 watt‐equivalent, 13 watt CFL.” The CFL bulb uses only
13 watts of power (what you pay for,) but it generates the light of a 60 watt incandescent
bulb. Therefore, the CFL uses only 13/60 = 22% of the power of the incandescent to generate the same
brightness.
For white LED’s we use the same system, and rate our bulbs by “watt‐equivalent,” with incandescent
light as the reference just like before. So, a 7‐watt LED that generates the brightness of a 70‐watt
incandescent bulb is a “70 watt‐equivalent, 7 watt LED.” The LED uses only 10% of the power of the
incandescent to generate the same brightness. That 90% energy savings is typical for LED’s, versus
incandescents. (Incandescents are inefficient light sources: they generate over 90% heat and less than
10% light.)

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Economic Analysis
For our economic analysis, we have used data from our affiliate – Shanghai Kepsun Optoelectronics Co.
Ltd. A normal urban house hold lighting requirement has been calculated at about 1000 W of
incandescent bulb light i‐e 10 bulbs of 100 W each and that requirement is then converted into CFL and
LED lights. The economic analysis has been done using the life cycle costing method taking the LED light
life as a bench mark.

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Energy Savings Calculator for Replacing Light Bulbs

LED Qty
(Light-Emitting
Assumptions Diode Light Bulbs) Load Cost (PKR)
Normal Urban Household Lighting Requirement
2 X Bed Rooms X 12 Watt X 1 LED Bulbs 2 24 Watt 960.00

1 X TV Lounge X 12 Watt X 2 LED Bulbs 2 24 Watt 960.00
1 X Drawing Room X 12 Watt X 2 LED Bulbs 2 24 Watt 960.00
1 X Dining Room X 12 Watt X 1 LED Bulb 1 12 Watt 480.00
1 X Kitchen X 12 Watt X 1 LED Bulb 1 12 Watt 480.00
2 X Bath Rooms X 6 Watt X 1 LED Bulb 2 12 Watt 480.00
1 X Outdoor X 6 Watt X 2 LED Bulb 2 12 Watt 480.00
12 120 Watt 4,800.00
Solar System
Solar Panel Cost 1 150 Watt 37,500.00

Battery Charge Controller Card 1 4,000.00
Maintenance Free Batter 50Amps 1 10,000.00
51,500.00
Total Solar System & Bulb Replacement Cost 56,300.00
1 Solar panel load has been worked out at 125% of total load to account for fluctuation.
2 50Amps battery would give continous lighting for 10 hours at 50% load and 5 hours at 100% load.

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Energy Savings Calculator for Replacing Light Bulbs

CFL LED
Incandescent Light Bulbs (Compact Fluorescent Light Bulbs) (Light-Emitting Diode Light Bulbs)
Life Span (in hours) 1,500 10,000 60,000

Watts 100 25 12
Cost PKR 25.00 PKR 160.00 PKR 480.00
KWh of electricty used over 60k hours 6,000 1,500 720
Electricity Cost (@ 5.76 per KWh) PKR 34,560.41 PKR 8,640.10 PKR 0.00
Solar Panel 150 Watt (For 25 years) PKR 0.00 PKR 0.00 PKR 37,500.00
Maintenance Free Battery (For 7 years) PKR 0.00 PKR 0.00 PKR 10,000.00
Solar Panel Controller Card (For 25 years) PKR 0.00 PKR 0.00 PKR 4,000.00
Bulbs needed for 60k hours of usage 40 6 1
Equivalent 60k hour bulb expense PKR 1,000.00 PKR 960.00 PKR 480.00
Total 60,000 Hour Lighting Spend PKR 35,560.41 PKR 9,600.10 PKR 51,980.00
Calculate Your Energy Savings
# of household light bulbs 10 10 10

Your estimated daily usage (hours) 5 5 5
Days in month 30 30 30
Household savings over 60,000 hours (energy + replacement)

Household cost PKR 355,604.09 PKR 96,001.02 PKR 56,300.00
Savings by switching from Incandescent PKR 0.00 PKR 259,603.06 PKR 299,304.09
Monthly household energy savings

KWh used per month 150 38 0
Electricity Cost (@ 5.76 per KWh) PKR 864.01 PKR 216.00 PKR 0.00
Savings by switching from Incandescent PKR 0.00 PKR 648.01 PKR 864.01
Yearly household energy savings

KWh used per year 1,825 456 0
Electricity Cost (@ 5.76 per KWh) PKR 10,512.12 PKR 2,628.03 PKR 0.00
Savings by switching from Incandescent PKR 0.00 PKR 7,884.09 PKR 10,512.12
Electricity cost per KWh has been taken average during the lifespan of LED bulb and has been calculated
to increase 10% every year taking base rate average for household as reported by PEPCO for the period
from July 2007 to March 2008, which is Rs. 4.25 per KWh.
The above analysis shows that replacement of current lighting arrangement with the Solar Light + LED
bulbs is much more beneficial not only in terms of savings but also on account of supply of
uninterrupted light.

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Marketing Analysis
This summer, the country would face an electricity deficit of over 3,500 megawatts (MW). The pace at
which the electricity deficit is likely to increasing, it is feared that by 2010 the gap between demand and
supply would be around 4000 megawatts (MW). The situation demands a collective effort on the part of
all stakeholders of society, including policy makers, academia, industrialists and entrepreneurs and
ordinary citizens. Following table shows the historical consumption of different energy sources.

A further breakup shows that largest consumer of electricity is the household sector followed by
industrial sector. Electricity consumption is increasing at a faster rate in recent couple of years at an
average of 8%.

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The total installed capacity of electricity generation witnessed no change during July‐March 2006‐07,
remaining at 19,440 MW. The Water and Power Development Authority (WAPDA), Karachi Electric
Supply Corporation (KESC), Karachi Nuclear Power Plant (KANUPP) and Chashma Nuclear Power Plant
are the four main public sector organizations involved in power generation, transmission and
distribution of electricity in the country. In addition, the Independent power projects (IPPs) are also
involved in power generation. The total installed capacity of WAPDA stood at 11,363 MW during July‐
March 2006‐07 which accounts for 58 percent of total installed capacity. Of this, hydel power accounts
for 56.9 percent or 6,463 MW and thermal accounts for 43.1 percent or 4,900 MW. The total installed
capacity of IPPs is 5,859 MW (30.1 percent), KESC’s is 1,756 MW (9.0 percent) and nuclear power is 462
MW (2.4 percent) of the total installed capacity. The detail is given below: ‐

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The electricity generated by WAPDA during July‐March 2006‐07 was 63,020 Gwh, as against 58,928 Gwh
during the corresponding period last year, thus registering an increase of 6.9 percent due to higher
generation through thermal by 12.8 percent. The detail is as follows: ‐

The number of electricity consumers has increased over the years due to rapid extension of electric
supply to villages and fast urbanization. The number of consumers has increased to 16.7 million till
March 2007, up from 15.9 million in 2005‐06, showing an increase of 5 percent over the last year and a
growth of about 70 percent since 1996‐97. The following table illustrates the position.

Historically Pakistan faced electricity deficit from 1990 to 1997. The demand and supply of electricity
was balanced in 1997. From 1997, the generation capacity increased and it was expected that the
demand and supply position of electricity will remain in equilibrium up to 2009. However, as existing
peak demand approached 6.6 percent growth per annum during 2001 to 2007 the supply shortage
occurred much earlier than 2009. Brisk pace of economic activity, rising levels of income of the people,
the double‐digit growth of large scale manufacturing, higher agricultural production and village
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electrification program have all resulted in higher demand of power in Pakistan. All these factors have
contributed to the shortage of nearly 3500MW. This gap needs to be filled by using all the resources
available. Presently power shortage is a worldwide phenomenon due to the accelerating levels of
economic activity. According to the International Energy Agency, which acts as energy policy advisor to
26 developed countries, the world can only meet its energy needs till 2030‐35 through traditional
sources. Realizing the gravity of the situation many countries are taking steps to develop alternate
source of energy to meet their future requirements. Similarly, Pakistan is also seeking to develop
generation capacity through alternate energy including the wind and solar technologies. The goal is to
ensure that at least 7 percent of total power generation capacity is met through wind & solar energy by
year 2030, which means about 4700MW of electricity through renewable energy sources and solar
energy is one of the most viable and free source available to us. So there is a huge energy market for
solar based lighting solutions.

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Product Analysis
With respect to the consumer demographics and target market best suited with the technology we
developed four different packages of light solutions to the consumers. These are different in lighting
capacity and pricing. The detailed features of the products are as follows:
Complete Urban Household Lighting Solution P.Code CU001
LED Qty Amount

Assumptions (Light-Emitting Diode Light Bulbs) Load (PKR)
Sale Price 65,000.00

12 120 Watt 4,800.00
Solar System

Battery 50Amps 1 4,000.00
45,500.00
Gross Profit 14,700.00
This package is offered to the urban customers with the complete light solution for their living house
with the perception that they will use 50% to 100% of its installed capacity, and will use no alternate
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lighting system parallel with this solution. This package can also be useful for the institutional customer
but we are not targeting them at the initial phase of the business.
Partial Urban Household Lighting Solution P.Code PU001
LED Qty Amount


12 120 Watt 4,800.00
Solar System

Battery 25 Amps 1 2,000.00
18,500.00
1 Solar panel load has been worked out at maximum of 40 Watt load.
2 25 Amps battery would give continous lighting for 6 hours at 40 Watt load.

This package is also designed to provide the lighting solution to the urban customer but with the
expectation that they will not use the full installed capacity of the system or they will not use the full
available capacity, it can be used as alternate source of lighting.

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Economy Urban Household Lighting Solution P.Code EU001
LED Qty Amount

0.00
0.00
0.00
0.00
6 36 Watt 2,400.00
Solar System

13,500.00
This package is designed for the low income class living in the urban area and facing energy problems
and most of them are price conscious. This is not a complete home solution but can fulfill the basic
lighting requirements of the consumer.

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Rural/Remote Household Lighting Solution P.Code RL001
LED Qty Amount

0.00
1 X Living Room X 6 Watt X 1 LED Bulbs 1 06 Watt 240.00
0.00
0.00
0.00
0.00
2 12 Watt 480.00
Solar System

7,500.00
This package is planned to provide the light to the rural and remote areas where there is no electricity
so for and they are not enjoying the colors of life. We will provide this solution to the consumer at the
lowest possible price or at cheaper rate.

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Marketing Plan
The company is pursuing four solutions aimed at four categories of customers viz. (1) A normal urban
household that wish to switch complete lighting to Solar powered LED based lighting solution (2) A
normal urban household that wish to switch necessary lighting to Solar powered LED based lighting
solutions (3) A normal urban household that wish to switch must have lighting to Solar powered LED
based lighting solution and (4) Rural / Remote household that wish to light up the house.
Although all urban areas of the country are linked with the main power grid and there should be no
need for our lighting solutions but due to load shedding or load management these are without any light
for 6hrs to 12hrs daily and cost of electricity is increasing at an average rate of 10% are the main points
that we have focused on this market segment. The initial cost of the solar based LED lighting solution is
high but this solar based LED lighting solution will be free for a minimum of seven years without any
replacement for bulbs, battery and solar panel. The life of solar panel is twenty five years so the only
replacement during this period is bulbs and battery three times.
The highest concentration of non‐electrified households is in rural and remote areas. These end‐users
do not have access to the electricity grid and rely mainly on kerosene oil lamps. These households will
get benefit from the use of solar panels for lighting in the night at free for twenty five years.
We shall market our products direct to customers. For this purpose, we shall advertise our solutions in
print media and solicit housing colonies management. Promotional campaigns shall also be part of our
promotion strategies and these shall be like sampling of LED bulbs, donating complete solution and
public demonstration of products to attract customers.
There are two to three main players in the market that are selling complete solar powered LED based
lighting solutions. They are concentrating on Government’s Rural Electrification Program and are
working in remote off grid areas. Presently, urban household market is vacant and we shall be
concentrating on this market and offering a replacement of inverter based lighting solution that is more
economical and more beneficial in terms of luminous flux. We are cost efficient as compared to present
competition. We shall provide our customers personalized services vis‐à‐vis our competitors as they are
providing solutions as contractor to government, which is a very stereo typed service.
Promotion
Company will use a promotional strategy based on the limited resources so our promotional focus will
be on the road shows nearby to the newly developed or developing colonies and we will take part in the
number of trade exhibitions to help our consumers to know our products.
Another aspect of our promotional strategy will be the close collaboration with the NGOs this is some
sort of different mode but it would help company to get familiarity in the remote areas and especially
rural areas.
We will also use electronic media for the products promotion including internet and product awareness
programs on television.
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Distribution
As the market segment for the products are very diverse so this would not be beneficial to
adopt a static distribution strategy so we will follow a dynamic distribution strategy for the
startup phase of the venture. We will use the options of large retailers, distributors, sales
franchises, electronic distribution and distribution through NGO networks during this strategy.
At the startup phase we will follow low cost distribution channels like E‐distribution and
distribution through NGO also will prefer to use some franchises. Later on in the initial phase
and expansion phase we will focus on intensive marketing and distribution strategy.

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Operational Plan
We shall be providing service to our customers by sourcing the most efficient and economical source for
supply of our components. The company is in negotiation with the Shanghai Kepsun Optoelectronics Co.
Ltd, China for technical collaboration and import of LED bulbs.
Solar panels are being assembled in Industrial Estate Hattar, Pakistan and also are being imported from
China and we shall make all our purchases from local sources thus avoiding long lead times.
There are four manufacturers of lead liquid based batteries in Pakistan and also maintenance free dry
batteries are being imported through proper channels and otherwise into Pakistan and we shall make
our procurement on this account through local sources.
Rest of the components like battery charger card and other miscellaneous items such as wiring and shall
also be procured locally.

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Management
This idea is to provide the services in terms of lighting solutions to the consumer by arranging solar
panels, battery charging cards, solar battery, LED bulbs and channels. We will assemble this all into one
package and supply to the end consumer, households in the first phase.
To manage these activities we are the 4 partners contributing the financial and human resources with
skills and knowledge. We, the partners have the diverse knowledge of different required fields. One of
the partners is having engineering degree and expertise that assist technically. Other partner is having
some expertise in the field of finance and command on financial projections, so that will help us in
making proto type of the business activities before going to the field for taking risk.
3rd partner is having local market knowledge and a good social worker in the vicinity; he is having good
social contracts with the people in different fields and engaged in different businesses. The last partner
of our business is having legal knowledge and having some experience of practicing as advocate specially
taking the cases of tax and corporate crimes.
We the team of four as partner will get some other required skills and knowledge by hiring professional
and competent people in our staff.
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Economic Justification
The company has developed four readymade solutions to cater to the needs of target market. A very
conservative forecast against the backdrop of 4000MW shortage of electricity has been made for the
purpose of economic justification.
Project Cost

Project Cost
PKR (,000)
Fixed Cost
Office Furniture & Fixture 100

Office Equipment 100
200
Other
Security Advance For Rented Premises 150

Preliminary Expenses 100
250
450
Working Capital
Inventory 782
Cash & Bank 150
932
Total 1,382
Financing
Equity 1,382
Total 1,382

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Projected Profit & Loss Statement
Profit & Loss Statement
Sales 12,250 13,475 16,170 20,950 29,000
Cost of Sales 9,563 10,519 12,623 16,358 22,650
Gross Profit 2,687 2,956 3,547 4,592 6,350
Operating Expenses 1,700 1,868 2,053 2,256 2,480
Net Profit Before Tax 987 1,088 1,494 2,336 3,870
Income Tax @ 35% 345 381 523 818 1,355
Net Profit / (Loss) 642 707 971 1,518 2,516

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Projected Balance Sheet
Balance Sheet
Assets
Fixed (Net) 180 160 140 120 100
Others 250 250 250 250 250
Current
Inventory 782 805 1,019 1,400 1,820

Cash & Bank 812 1,516 2,293 3,450 5,565
1,593 2,320 3,312 4,850 7,386
Total 2,023 2,730 3,702 5,220 7,736
Capital & Liabilities
Equity 1,382 1,382 1,382 1,382 1,382

Retained Earnings 642 1,349 2,320 3,838 6,354
Total 2,024 2,731 3,702 5,220 7,736

Page 28 of 34
Cash Flow Statement
Cash Flow Statement
Opening Balance 150 812 1,516 2,293 3,450
Cash Receipts
Cash From Sales 12,250 13,475 16,170 20,950 29,000

Depreciation 20 20 20 20 20
Total Cash Receipts 12,270 13,495 16,190 20,970 29,020
Cash Payments
Cost of Goods Sold 9,563 10,519 12,623 16,358 22,650

Operating Expenses 1,700 1,868 2,053 2,256 2,480
Increase in Inventory - 23 214 381 421
Income tax payment 345 381 523 818 1,355
Total Cash Payments 11,608 12,791 15,413 19,813 26,905
Cash Generation 662 704 777 1,157 2,115
Closing Balance 812 1,516 2,293 3,450 5,565

Page 29 of 34
Assumptions Underlying Financial Statements
Sales Forecast
Sales Forecast (Qty)
Product Code Product Name Year1 Year2 Year3 Year4 Year5
CU001 Complete Urban Household Lighting Solution 50 55 66 80 100

PU001 Partial Urban Household Lighting Solution 200 220 264 350 500
EU001 Economy Urban Household Lighting Solution 100 110 132 175 250
RL001 Rural/Remote Household Lighting Solution 100 110 132 175 250
Total 450 495 594 780 1100
Sales Forecast (PKR ,000)

CU001 Complete Urban Household Lighting Solution 3,250 3,575 4,290 5,200 6,500
PU001 Partial Urban Household Lighting Solution 6,000 6,600 7,920 10,500 15,000
EU001 Economy Urban Household Lighting Solution 2,000 2,200 2,640 3,500 5,000
RL001 Rural/Remote Household Lighting Solution 1,000 1,100 1,320 1,750 2,500
Total 12,250 13,475 16,170 20,950 29,000

Cost of Sale Scedule
Cost of Goods Sold (PKR ,000)
CU001 Complete Urban Household Lighting Solution 2,515 2,767 3,320 4,024 5,030
PU001 Partial Urban Household Lighting Solution 4,660 5,126 6,151 8,155 11,650
EU001 Economy Urban Household Lighting Solution 1,590 1,749 2,099 2,783 3,975
RL001 Rural/Remote Household Lighting Solution 798 878 1,053 1,397 1,995
Total 9,563 10,519 12,623 16,358 22,650

Page 30 of 34
Schedule of Expenses
Schedule of Operating Expense (PKR ,000)
Acct. Code Name of Expense Year1 Year2 Year3 Year4 Year5
Rent 300 330 363 399 439

Utilities 60 66 73 80 88
Salaries 600 660 726 799 878
Travelling 120 132 145 160 176
Advertisement & Promotion 600 660 726 799 878
Depreciation & Amortization 20 20 20 20 20
Total 1,700 1,868 2,053 2,256 2,480

Inventory Schedule
Inventory Forecast (Qty)
Product Code Product Name QTY Year1 Year2 Year3 Year4 Year5
Qty (,000) Qty (,000) Qty (,000) Qty (,000) Qty (,000)
CU001 Complete Urban Household Lighting Solution 50 55 66 80 100
L12W LED Bulbs 12 W 8 40 19.2 40 19.2 44 21.12 55 26.4 80 38.4

L06W LED Bulbs 6 W 4 20 4.8 20 4.8 22 5.28 30 7.2 40 9.6
S150W Solar Panel 150W 1 4 150 4 150 5 187.5 7 262.5 8 300
BCHC Battery Charger Card 1 4 16 4 16 5 20 7 28 8 32
B50A Battery 50 Amps 1 4 16 4 16 5 20 7 28 8 32
206 206 254 352 412
PU001 Partial Urban Household Lighting Solution 200 220 264 350 500
L12W LED Bulbs 12 W 8 160 76.8 160 76.8 176 84.48 250 120 350 168
L06W LED Bulbs 6 W 4 80 19.2 80 19.2 88 21.12 120 28.8 170 40.8
S050W Solar Panel 50W 1 16 200 16 200 22 275 30 375 40 500
B25A Battery 25 Amps 1 16 32 16 32 22 44 30 60 40 80
392 392 513 704 949
EU001 Economy Urban Household Lighting Solution 100 110 132 175 250
L12W LED Bulbs 12 W 0 0 0 0 0 0 0 0 0 0 0

L06W LED Bulbs 6 W 6 50 12 55 13.2 66 15.84 90 21.6 125 30
S030W Solar Panel 30W 1 8 60 9 67.5 11 82.5 15 112.5 20 150
B25A Battery 25 Amps 1 8 16 9 18 11 22 15 30 20 40
120 135 164 224 300
RL001 Rural/Remote Household Lighting Solution 100 110 132 175 250
L12W LED Bulbs 12 W 0 0 0 0 0 0 0 0 0 0 0

L06W LED Bulbs 6 W 2 16 3.84 18 4.32 22 5.28 30 7.2 40 9.6
S010W Solar Panel 10W 1 8 20 9 22.5 11 27.5 15 37.5 20 50
B10A Battery 10 Amps 1 8 8 9 9 11 11 15 15 20 20
64 72 88 120 160
Total 782 805 1,019 1,400 1,820

Page 31 of 34
Product Wise Price & Cost
Complete Urban Household Lighting Solution P.Code CU001
LED Qty Amount


12 120 Watt 4,800.00
Solar System

Battery 50Amps 1 4,000.00
45,500.00

Page 32 of 34
Partial Urban Household Lighting Solution P.Code PU001
LED Qty Amount


12 120 Watt 4,800.00
Solar System

18,500.00

Page 33 of 34
Economy Urban Household Lighting Solution P.Code EU001
LED Qty Amount

0.00
0.00
0.00
0.00
6 36 Watt 2,400.00
Solar System

13,500.00

Page 34 of 34
Rural/Remote Household Lighting Solution P.Code RL001
LED Qty Amount

0.00
1 X Living Room X 6 Watt X 1 LED Bulbs 1 06 Watt 240.00
0.00
0.00
0.00
0.00
2 12 Watt 480.00
Solar System

7,500.00

Solar LED Lighting System

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Legal Status : Unquoted Public Limited Company

Business : Solar + LED Based Lighting Solution

Sales 12,250 13,475 16,170 20,950 29,000

Net Profit / (Loss) 642 707 971 1,518 2,516

Total 2,023 2,730 3,702 5,220 7,736

Capital & Liabilities

Equity 1,382 1,382 1,382 1,382 1,382

Total 2,024 2,731 3,702 5,220 7,736

Energy Savings Calculator for Replacing Light Bulbs

Normal Urban Household Lighting Requirement

2 X Bed Rooms X 12 Watt X 1 LED Bulbs 2 24 Watt 960.00

12 120 Watt 4,800.00

Solar Panel Cost 1 150 Watt 37,500.00

Total Solar System & Bulb Replacement Cost 56,300.00

Energy Savings Calculator for Replacing Light Bulbs

Life Span (in hours) 1,500 10,000 60,000

Calculate Your Energy Savings

# of household light bulbs 10 10 10

Household savings over 60,000 hours (energy + replacement)

Monthly household energy savings

Yearly household energy savings

Complete Urban Household Lighting Solution P.Code CU001

LED Qty Amount

Sale Price 65,000.00

Normal Urban Household Lighting Requirement

2 X Bed Rooms X 12 Watt X 1 LED Bulbs 2 24 Watt 960.00

12 120 Watt 4,800.00

Solar Panel Cost 1 150 Watt 37,500.00

Total Solar System & Bulb Replacement Cost 50,300.00

Gross Profit 14,700.00

Partial Urban Household Lighting Solution P.Code PU001

LED Qty Amount

Sale Price 30,000.00

Normal Urban Household Lighting Requirement

2 X Bed Rooms X 12 Watt X 1 LED Bulbs 2 24 Watt 960.00

12 120 Watt 4,800.00

Solar Panel Cost 1 50 Watt 12,500.00

Total Solar System & Bulb Replacement Cost 23,300.00

Gross Profit 6,700.00

Economy Urban Household Lighting Solution P.Code EU001

LED Qty Amount

Sale Price 20,000.00

Normal Urban Household Lighting Requirement

Solar Panel Cost 1 30 Watt 7,500.00

Total Solar System & Bulb Replacement Cost 15,900.00

Gross Profit 4,100.00

Rural/Remote Household Lighting Solution P.Code RL001

LED Qty Amount

Sale Price 10,000.00

Normal Urban Household Lighting Requirement

Solar Panel Cost 1 10 Watt 2,500.00

Total Solar System & Bulb Replacement Cost 7,980.00

Gross Profit 2,020.00

Office Furniture & Fixture 100

Security Advance For Rented Premises 150

Sales 12,250 13,475 16,170 20,950 29,000

Cost of Sales 9,563 10,519 12,623 16,358 22,650

Gross Profit 2,687 2,956 3,547 4,592 6,350

Operating Expenses 1,700 1,868 2,053 2,256 2,480

Net Profit Before Tax 987 1,088 1,494 2,336 3,870

Income Tax @ 35% 345 381 523 818 1,355

Net Profit / (Loss) 642 707 971 1,518 2,516

Fixed (Net) 180 160 140 120 100

Others 250 250 250 250 250