The project is to build an Interstate Bus Terminus under a Build Operate and Transfer (BOT) Model.

You are
expected to build a scalable, dynamic financial model which will showcase all the revenues, expenses, depreciation,
taxes etc. and build the projected Balance sheet, P & L and cash flow statements along with the estimated NPV and
IRR for the project. You can make your assumptions wherever appropriate. However one set of assumptions have
been highlighted as a story from the next paragraph. Whatever are the numbers given below are mere assumptions
and can change. You are expected to build a model where if any of the assumptions below change, the change is
reflected all the way into the financial statements and can update the NPV and IRR of the project as well. The model
should be able to reflect the sensitivity analysis associated with any of the variable changes.
The overall concession period is for 33 years where it may take 2 years for construction and the remaining 31
years for the operations of the project. You are also expecting that 40% of the construction work will be done in
Year 1 and the remaining 60% in Year 2.
You also expect the average inflation to be around 5% for the entire period. You also expect that all your revenues
will grow at an annual rate of 7% while the operations expenses will grow at 5%.
You expect the project to be financed with 60% of Debt and 40% equity. The Debt will have a drawdown period of
2 years and a 1 year post draw down moratorium and the amount be repaid in 12 years from then at a rate of 12%
per year. The drawdown happens quarterly. You can assume that the interest on Cash Surplus & Debt service
reserve account(DSRA) is 6% and interest on Cash overdraft is 14%. You need to maintain a DSRA reserve of
atleast 6 months of the payment of Interest and Principal needed for the next year.
Assume that the project costs contain 80% of Building and Civil Works, and 10% each in Furniture and Fixtures as
well as Plant and Machinery. The depreciation figures are provided in the spread sheet attached
You can assume 34% for Corporate Tax and 17% for MAT as well as for Dividend distribution Tax
About the Project
The land allocated for the project is 55 Acres. The market value of the land is Rs. 1.50 Crore per acre and the
company is expected to pay an annual lease rental of 1.2% of the value of the land. It is expected that the expected
value of land increases at 5% every year. In addition to the lease rental, the company is expected to deposit 50% of
the annual lease rental as the lease deposit.
Construction Assumptions
Your team has done enough research and has come up with the following cost assumptions

The Basic infrastructure construction cost is estimated at INR 21.60 Crores

Total Parking area development cost is estimated at INR 25.04 crores
Cost for Building the Bus Terminal Area (2 Floors including Bus Bay Units, Passenger Lobby, Bus Operators
Office Spaces, Bank Extension Counters, Driver Amenities, Budget Hotel, Dormitories, Food Court, Primary
Health Center and Administrative offices) is expected to be INR 22.75 Crores
The support facilities are expected to cost another INR 7.68 Crores
You may assume that all these costs are distributed in the same proportion as the work completion over
the 2 year period

Others
The Preoperative Cost is 10% of the total construction cost. The project development cost is estimated at 2% of the
escalated construction cost. Stamp Duty is charged at 0.8% of the total lease rentals or 5% of the land value
whichever is higher. The project also requires an upfront premium of INR 15crores to be paid. Registration charges

are levied at 0.5% of the Average annual lease rentals. Insurance premium cost is expected at 1% of the
construction cost of the year. The Financing cost of the year is 1.5% of the total debt for the year.
Revenue Assumptions
You are making the following annual revenue assumptions as of the current prices and at 100% utilization levels

Expected Parking Revenue per year is INR 2.5 Crores

Expected Revenue from Bus Terminal Area is INR 7 Crores
Budget Hotel is expected to give a revenue of INR 1.4 Crores
Primary Health care center, Bank Extension Center, Office space for Cargo operators are expected to fetch you
revenues of INR 15 Lakh, INR 21 Lakh & INR 50 Lakh respectively
You are also expected to generate a revenue of INR 2.5 crores from advertisements and INR 50 Lakhs from
outsourcing of supporting facilities

Operating & Maintenance Cost Assumptions

Bus Terminal Area
Parking
Office Space, PHC, Banks & Support
Budget Hotel
AMC for Basic Infrastructure & Lighting
Security Guards
Water Bill
Power Bill

5% of the Head revenue

5% of head Revenue
5% of Head revenue
30% of Head revenue
5% of the total Revenue
INR 30 Lakh per year
INR 35 Lakh per year
INR 25 Lakh per year

Criteria for short listing

1. You are expected to send the work sheet associated with the construction phase of the project based on which
you would be shortlisted for the full project where you will be working on the Operations phase of the project.
Remember all the numbers listed above are subjected to change and your model need to account for all of
them. Make any other assumptions if you want and list them.