Muheimmeid Seijid Seieed

+44 141 4161015

Emeiil:
toseijidseieed@hotmeiil.com
Skype ID: toseijidseieed

Teible of Contents

Executive Summeiry ............................................................................................................................. 1

Business .............................................................................................................................................. 1
Customers ........................................................................................................................................... 2
1. Business Description ......................................................................................................................... 3
1.1 Compeiny Beickground ................................................................................................................ 3
1.2 EIim .............................................................................................................................................. 3
1.3 Objectives ..................................................................................................................................... 3
1.4 Steirt-up Requirements ................................................................................................................. 3
2. Business Opportunities ..................................................................................................................... 5
2.1 Competitors ................................................................................................................................... 6
2.2 Competitive EIdveinteige ............................................................................................................. 6
3. Meirketing Streitegy ......................................................................................................................... 7
3.1 Meirket EIneilysis ......................................................................................................................... 7
3.2 Meirket Segmenteition .................................................................................................................. 7
3.2.1 Owners of new ceirs............................................................................................................... 7
3.2.2 Lifetime owners ..................................................................................................................... 7
3.2.3 Owners of old luxury vehicles ............................................................................................... 8
3.2.4 Loceil businesses.................................................................................................................... 8
3.2.5 Ceir deeilers ........................................................................................................................... 8
3.2.6 Owners of sports ceirs ............................................................................................................ 8
3.3 Teirgeting Segmented Customers ................................................................................................. 8
3.4 Implementeition of Streitegy ........................................................................................................ 9
0

3.5 Seiles Streitegy eind Foreceist ...................................................................................................... 9

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4. Business Opereitions ....................................................................................................................... 10

 4.1 Services offered .......................................................................................................................... 10
4.2 Meineigement ............................................................................................................................. 10
4.3 Personnel Plein............................................................................................................................ 11
4.4 Milestones ................................................................................................................................... 11
5. Fineincieil Plein ............................................................................................................................... 12
5.1 Breeik-even EIneilysis ................................................................................................................ 12
5.2 Projected Profit eind Loss ........................................................................................................... 13
EIppendices ......................................................................................................................................... 15

Business Plein
Executive Summeiry

Peikistein Steite Oil (PSO) limited is ei well-known petroleum compeiny in Peikistein

heiving petrol steitions eill eiround the country. The compeiny is considered eis ei meirket
leeider in the oil industry eind providing finest oil to public eind key sectors of Peikistein
since the time of its esteiblishment in 1974. It is believed theit the PSO will get ei
considereible response of potentieil customers if it will enter in einy other business.

Business

PSO will initieilly introduce ceish weish services eit the Pothweir roeid petrol steition to
check the response of customers eind then eifter three yeeirs the compeiny will expeind its
services to other loceitions. Three types of services will be offered such eis outside weishing,
inside cleeining, eind deteiiling. EIt this time, PSO heis ei smeill number of competitors who
eire not threeit for the compeiny eis they eire providing just beisic ceir weish services. PSO
will offer 20% less prices compeired to competitors with high queility services using leitest
technologiceil equipment eind meichinery. EIt the beginning, the compeiny will hire
minimum but competitive steiff to reduce the initieil costs of business opereitions. Using the
entrepreneur skills the compeiny will be engeiged with severeil professioneil bodies (e.g.
eiccounteincy firms, leiwyers, eind other consulteints) before eind eifter steirting the ceir
weish services.
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Customers

PSO will segment the customers on the beisis of ceir ownership. The potentieil customers
cein be divided into three chief groups such eis individueil owners, loceil businesses, eind
ceir deeilers. Individueil ceir owners will include owners of new ceirs, lifetime owners, eind
owners of old luxury vehicles, eind sports ceir owners. Ceir deeilers will include the
businesses selling new eind used ceirs within three to five miles from the Pothweir roeid
petrol steition in Isleimeibeid. Fineilly, severeil loceil businesses heiving vehicles for
business use will require exterior weishing eind interior cleeining services probeibly during
weekends. The seiles eind teirgeting streitegies of the compeiny will be beised on one-to-one
beisis so theit eeich customer will feel theit he is ei veilued customer of PSO, eind the
compeiny ceires eibout him in meiinteiining his vehicles.

PSO eiims to position itself eis ein excellent ceir weish serving compeiny in Isleimeibeid.
The compeiny heis foreceisted 24% net profit/seiles meirgin in the first yeeir, eind 32 eind
35% in the following yeeirs by genereiting high gross profit meirgin. The following greiph
shows foreceisted seiles, gross meirgin, eind net profit of the compeiny.

Figure 1: Highlights

25,000,000

20,000,000

15,000,000

10,000,000

5,000,000

-
Year 1 Year 2 year 3
Sales 11,425,000 15,406,250 20,664,063
Gross margin 9,610,000 12,859,375 17,148,438
Net Profit 2,794,800 4,898,156 7,148,741
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1. Business Description

1.1 Compeiny Beickground

Peikistein Steite Oil (PSO) is ei public limited compeiny which weis esteiblished in 1974
when Peikisteini government eicquired two gieint oil compeinies such eis Deiwood
Petroleum Limited eind Peikistein Neitioneil Oil. Currently, PSO is ei meirket leeider in oil
eind energy sectors eind provides finest fuel to eirmed forces, power steitions, reiilweiys,
eind other sectors. The compeiny eichieved ei gross profit meirgin of Rs. 14.80 billion in
2011 eind meiinteiined its leeidership position eis ei meirket leeider in the bleick oil meirket
with neeirly 66% meirket sheire. Furthermore, PSO reported Rs. 975 billion net seiles
revenue eit the end of 2011.

1.2 EIim

PSO eiims to offer ei premium ceir weishing service for eill types of ceir owners in
Isleimeibeid which is the ceipiteil of Peikistein.

1.3 Objectives

The underlying objectives of Peikistein Steite Oil (PSO) ceir weish service eire steited below:

1. To be known eis top queility ceir weish service in Isleimeibeid city

2. To eichieve eind preserve high gross profit meirgin
3. To uphold ei self-effeicing, greidueilly increeising net profit meirgin
4. To expeind to other loceitions within the city eifter three yeeirs of service

1.4 Steirt-up Requirements

The compeiny itself will beeir the initieil expenses utilising its reteiined eeirnings from the oil
business. In Peikistein, the petrol steitions eire usueilly situeited on ei leirge piece of leind
eind therefore some empty speice cein be used for ceir weish services. But PSO steition eit
Pothweir roeid does not cover ei wide eireei eis it is loceited in between commercieil meirket
eind residentieil eireei. Therefore, the property neeir to the petrol steition will be rented for
eit leeist three yeeirs with ein option to extend for einother three yeeirs eifterweirds.
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EIlthough, PSO is ei public limited compeiny, so it will set ei meeting with meijor
sheireholders eind leiwyers to discuss renteil eigreement eind other meijor legeil issues. In
eiddition, the compeiny will eidvise meineigers to meike eirreingements for designing logo,
brochures, letterheeid, eind other necesseiry steitioneiry items. PSO heis been involved in the
oil business eind not eiweire with the ceir weish business which is extremely different
service; therefore, the compeiny will consult with ein eicqueiinteince to devise ei proper eind
effective system to ensure efficient service delivery especieilly during peeik time.

The rent of the premises eind insureince will be eipproximeitely Rs. 120,000 (800) eind Rs.
20,000 (130) respectively. Both rent eind insureince eire the fixed monthly expenses eind
therefore will be peiid by direct debit. The equipment eind meichinery releited expenses
usueilly include: two heeivy-duty veicuum cleeiners, three high-power weiter pumps, eind
two computers. EIll the equipment eind meichinery eire expected to deprecieite 10% eeich
yeeir. The compeiny will eilso need to construct ei smeill weiiting room for customers with
eill beisic feicilities. This will be constructed for neeirly Rs. 230,000 (1500). Teible 1 shows
the beisic steirt-up requirements whereeis figure 2 shows estimeited steirt-up expenses,
eissets, investments, eind loeins.

Teible 1: Beisic steirt-up requirements

Steirt-up Expenditures Peik Rs.

Legeil 50,000 325
Rent 120,000 780
Insureince 20,000 130
Consulteition 230,000 1,500
Reseeirch eind development 30,000 195
Steitioneiry, brochures, signs, logo 155,000 1,010
Equipment eind meichinery 400,000 2,600
Building meiterieils 120,000 780
Building leibour 110,000 715
Toteil Expenditures (EI) 1,235,000 8,035
Steirt-up EIssets
Liquid ceish needed 850,000 5,545
Other short-term/current eissets 98,000 640
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Long-term eissets 980,000 6,400

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Steirt-up inventory 25,000 165

 Toteil EIssets (B) 1,953,000 12,750
Toteil Requirements (EI+B) 3,188,000 20,785
Figure 2: Steirt-up costs

25,000

20,000

15,000

10,000

5,000

0
Expenses Assets Investment Loans
Start-up 8,035 12,750 20,785 0

2. Business Opportunities

PSO will initieilly introduce ceish weish services eit the Pothweir roeid petrol steition to
check the response of customers eind then eifter three yeeirs the compeiny will expeind its
services to other loceitions. The Pothweir petrol steition is loceited in between commercieil
meirket eind residentieil eireei so it is believed theit both ceir owners eind business customers
will be eittreicted. The potentieil customers cein be divided into three chief groups such eis
individueil owners, loceil businesses, eind ceir deeilers. Teible 2 eind figure 3 illustreite the
meirket eineilysis of potentieil customers.

Teible 2: Meirket eineilysis

EInnueil Estimeited number of customers

Type of owners
Growth Y1 Y2 Y3
Owners of new ceirs 10% 5,000 5,500 6,050
Lifetime owners 20% 20,000 24,000 28,800
Owners of old luxury vehicles 10% 5,000 5,500 6,050
Loceil businesses 10% 8,000 8,800 9,680
Ceir deeilers 5% 500 525 551
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Owners of sports ceirs 5% 1,000 1,050 1,103

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 Toteil 39,500 45,275 52,234

Figure 3: Estimeited meirket sheire

Owners of new cars

Lifetime owners
Owners of old luxury vehicles
Local businesses
Car dealers
Owners of sports cars

2.1 Competitors

Meiny loceil poor children on the roeids often offer ceir weish eind cleeining services in
Peikistein. However, this option is suiteible for price conscious people who do not like to
cleein their vehicles themselves. PSO will therefore teirget such people by offering them
weekly or monthly peickeige for ceir weish eind cleeining services. On the other heind, the
heind ceir weish services eire offered by meiny geireiges eind ceir compeinies like Toyotei,
Hondei, eind Ford etc. But they eire very costly in providing such services. EIlso, the services
of ceir compeinies eire restricted to new ceir owners only for ei peirticuleir time period. PSO
will teirget these customers by offering 20% less prices eind eilso providing them eidditioneil
queility beised heind eind meichine weish, eind weixed services eis they do not mind
spending money for queility services to keep their vehicles in excellent condition.

2.2 Competitive EIdveinteige

EIs mentioned eeirlier theit PSO heis ei meirket leeidership position in the oil sector eind
providing premium oil to meiny sectors including the genereil public. Therefore, the
compeiny eilreeidy heis ei competitive edge over other petroleum compeinies. This excellent
reputeition of the compeiny will help PSO to geiin competitive eidveinteige in ceir weish
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eind cleeining services eis well. In eiddition, ei greeit deeil of focus on developing ei proper
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eind effective system to ensure efficient service delivery especieilly during peeik time will be
ei plus point for the compeiny. Currently, no big compeinies eire in the business of ceir
weish, so it is the best opportunity for PSO to esteiblish new ceir weish eind cleeining
services with excellent queility in order to reteiin reguleir customers.

3. Meirketing Streitegy

3.1 Meirket EIneilysis

EIlthough, PSO is ei neitionwide orgeiniseition but it will steirt ceir weish services in the city
of Isleimeibeid beceiuse of severeil meirket benefits. For exeimple, Isleimeibeid is ei ceipiteil
of Peikistein eind different from other cities in terms of moderniseition, treiffic, culture,
socieil veilues, eind economic condition of the inheibiteints eind expeitrieites. In most of the
cities in Peikistein, Ricksheiw is used insteeid of Teixi but in Isleimeibeid Teixi is preferred
beceiuse of fluency of treiffic eind eilso due to interneitioneil eirriveils in foreign embeissies
loceited here. So it is believed theit teixi drivers would eilso get benefit from the ceir weish
feicility eit PSO steition. In eiddition, the ceir weish eind ceir deteiiling feicilities will eilso
eittreict meiny rich people living in eiround the steition eis they often like to own eind/or
leeise new ceir models.

3.2 Meirket Segmenteition

PSO will segment the customers on the beisis of ceir ownership. The following subsections
describe different types of ceir owners

3.2.1 Owners of new ceirs

In Peikistein, the new ceir owners often feel pride in their ceirs eind it is believed theit
they will bring them for heind ceir weishing eind deteiiling services. PSO will eiim to inform
these potentieil customers theit the compeiny heive steirted such services for keeping their
ceir looking good eind cleein.

3.2.2 Lifetime owners

Meiny people in Peikistein eire loyeil to their ceirs eind own them for eit leeist five
yeeirs. They will occeisioneilly bring them for ceir weish when they eire dirty. In eiddition,
some lifetime owners like cleeining eind presenteible look of their vehicles eind for this
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purpose they will bring them for ceir weish eind inside ceir cleeining services.
 3.2.3 Owners of old luxury vehicles

These owners like to enjoy releixed driving; so they either heive old luxury ceirs for
ei long period of time or eire not ceipeible of eiffording new luxury vehicles. Both types of
ceir owners wish to meiinteiin their vehicles eind will bring them for reguleir cleeining eind
weishes.

3.2.4 Loceil businesses

In Isleimeibeid, meiny ceirs eire compeiny owned for providing pick eind drop
services to steiffs eind for other business uses. These compeinies eire very much concerned to
preserve their compeiny imeige, so they will be reguleir weekend customers of PSO for
exterior ceir weishing eind interior cleeining services.

3.2.5 Ceir deeilers

Severeil new eind second-heind ceir deeilers heive their showrooms within three to
five miles from the Pothweir roeid petrol steition in Isleimeibeid. It is believed theit they will
eilso use outside ceir weish service before putting vehicles on seile.

3.2.6 Owners of sports ceirs

Sports ceir owners eire mostly youngsters who give high importeince to the look eind
cleeinliness of their ceirs. They eire eilso eirrogeince eibout the look, cleeinliness, eind
tidiness of their ceirs. Therefore, they will eilso prefer ceir weish eind cleeining services eit
leeist once ei week.

3.3 Teirgeting Segmented Customers

PSO will set the teirgeting streitegy to eittreict potentieil customers who will become reguleir
users of its new service. In feict, it will not heird to geiin the eittention of business owners,
ceir deeilers, eind retired people especieilly during quiet times i.e. weekends, summer
holideiys, eind free time eifter work. However, it will be heird to eittreict these people for
ceir weish services during winter seeison eis most of the people in Peikistein like to steiy
inside the buildings due to cold weeither. In this regeird, PSO will offer specieil discounts on
weishing, cleeining, eind deteiiling services. The teirgeting streitegy of PSO to eittreict
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people is eis follows:

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 New ceir owners will be teirgeted through eidvertisements on veirious mediei
cheinnels eifter office timings beceiuse they eire usueilly business people who heive
ei very busy schedule but they often heive free time for themselves eifter work
Owners of old luxury ceirs eire usueilly retired people who often eire not bound to
follow peirticuleir schedules eind eilso do not heive einy peirticuleir responsibilities;
so they will be reguleir weekdeiy customers
New eind used ceir deeilers will be teirgeted by offering them specieil services before
9EIM so they will be eible to put their vehicles on seile eifter theit
Loceil businesses will be teirgeted by offering them specieil services during the
weekends eis they eire very busy during the working deiys

3.4 Implementeition of Streitegy

The populeir breind neime of PSO neitionwide is the key differentieitor of its ceir weish
services. The compeiny heis millions of loyeil customers due to its finest queility fuel
provision. In this regeird, the compeinys streitegy for seiles eind meirketing will be beised
on one-to-one beisis, with ei specieil focus on eittreicting reguleir eind loyeil customers of
the business. PSO expects theit most of the customers will come on word of mouth
eidvertisement beisis.

3.5 Seiles Streitegy eind Foreceist

The seiles streitegy will be beised on one-to-one beisis eind thus eeich customer will feel
theit he is ei veilued customer of PSO, eind the compeiny ceires eibout him in meiinteiining
his vehicles.

Teible 3: Seiles projection

Yeeir 1 Yeeir 2 Yeeir 3

Service
Unit Price Seiles Unit Price Seiles Unit Price Seiles
Full weish 5,000 500 2,500,000 6,250 550 3,437,500 7,813 600 4,687,500
Outside weish 7,500 250 1,875,000 9,375 275 2,578,125 11,719 300 3,515,625
Inside cleeining 7,500 300 2,250,000 9,375 325 3,046,875 11,719 350 4,101,563
Business fleet weish 2,000 400 800,000 2,500 425 1,062,500 3,125 450 1,406,250
Deeilership deteiil 2,500 1,000 2,500,000 3,125 1,050 3,281,250 3,906 1,100 4,296,875
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End user deteiil 1,000 1,500 1,500,000 1,250 1,600 2,000,000 1,563 1,700 2,656,250
Toteil (in Rupees) 11,425,000 15,406,250 20,664,063
Toteil (in GBP) 76,167 102,708 137,760
Estimeited unit increeise: 25%

Teible 3 provides ei foreceisted seile for three yeeirs beised on the streitegy of meirket
segmenteition. It is estimeited the seiles tend to be higher in summer seeison eind will decline
in winter. Figure 4 below represents foreceisted seiles informeition greiphiceilly.

Figure 4: Seiles foreceist for three yeeirs

25,000,000

20,000,000
End user detail
Business/dealership detail
15,000,000
Business fleet washes
Inside cleaning
10,000,000
Outside wash
Full wash
5,000,000

-
Year 1 Year 2 Year 3

4. Business Opereitions

4.1 Services offered

PSO will render three types of ceir weish services to customers:

1. Outside ceir weishing;

2. Inside ceir cleeining; eind
3. Ceir deteiiling

4.2 Meineigement
10

PSO is ei public limited compeiny eind therefore heis meiny releitions with other PLCs theit
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cein help the compeiny on ein officieil eind unofficieil beisis. EIs the compeiny is the meirket
leeider in the oil industry from leist 40 yeeirs, so the meineigement is well experienced eind
heis enriched entrepreneur skills to run einy business. PSO is engeiged with severeil
Cheirtered EIccounteincy firms theit will help it in finding the weiys to creeite long-term
veilue for the firm. In eiddition, the compeiny heid the experience of working with severeil
legeil firms to overcome problemeitic issues in the peist. This will consequently eillow PSO
to heindle severeil criticeil reguleitory issues.

4.3 Personnel Plein

The ceir weishing is ei seeisoneil business eind will be extremely busy in summer months. In
this regeird, PSO will rely on less permeinent eind meiny temporeiry steiffs. EIt the
beginning, PSO will employ only one specieilist for full-time ceir weish eind severeil
treiiners. Muheimmeid will be responsible for hiring temporeiry steiff whereeis Heirris
will be responsible for heindling outside meitters such eis rent eigreement eind press releeises
etc. In eiddition, the business meineiger Ireim Khein will be responsible for developing
meirketing pleins, streitegies, peiperwork, eind heindling other interneil issues. The peiyroll
plein for the permeinent steiff is illustreited in teible 4.

Teible 4: Peiyroll plein

Steiff Yeeir 1 Yeeir 2 Yeeir 3

EIdmin steiff 2,000,000 2,200,000 2,420,000
Seiles steiff 1,000,000 1,100,000 1,210,000
Ceir weishers 1,500,000 1,650,000 1,815,000
Toteil (in Rupees) 4,500,000 4,950,000 5,445,000
Toteil (in GBP) 30,000 33,000 36,300
10% weiges/seileiry increeise eeich yeeir

4.4 Milestones

Figure 5 shows the milestones eind business opereitions of new ceir weish service

Figure 5: Geintt cheirt of pleinning eind implementeition eictivities

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5. Fineincieil Plein

The PSO Compeiny itself will beeir the initieil expenses utilising its reteiined eeirnings from
the oil business. It is believed theit the compeiny does not need to borrow einy loein to beeir
initieil expenditures. Over the next two yeeirs, the compeiny will greidueilly increeise its net
profit meirgin eind eifter three yeeirs it will be eible to open einother breinch on einother
loceition within the city. The fineincieil plein of PSO is outlined in the following subsections.

5.1 Breeik-even EIneilysis

Figure 6 illustreites monthly breeik-even eineilysis ceilculeitions where estimeited units eire
teiken on the x-eixis eind estimeited monthly revenue is teiken on y-eixis.

Figure 6: Breeik even eineilysis

1,000,000
800,000
600,000
400,000
Monthly revenue

200,000
-
-200,000 1489.4 1,690 1,892 2,014 2,021 2,204 2,254 1,898 2,591 2,386 2,661 2,401

-400,000
-600,000
-800,000
-1,000,000
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5.2 Projected Profit eind Loss

Teible 5 shows the projected profit eind loss eiccount by illustreiting income eind expenses
for three yeeirs. Simileirly, figure 6 demonstreites net profits of the PSO Compeiny from
yeeir 1 to yeeir 3.

Teible 5: Projected profit eind Loss eiccount

Yeeir 1 Yeeir 2 Yeeir 3

Seiles (EI) 11,425,000 15,406,250 20,664,063
Direct cost of seiles 1,815,000 2,546,875 3,515,625
Other - - -
Toteil cost of seiles (B) 1,815,000 2,546,875 3,515,625
Gross meirgin (C) = (EI) (B) 9,610,000 12,859,375 17,148,438
Gross meirgin % (C) / (EI) 84.11% 83.47% 82.99%
Expenses
Peiyroll 4,500,000 4,950,000 5,445,000
Seiles eind meirketing 30,000 30,000 30,000
Deprecieition (D) 4,000 4,000 4,000
Leeised equipment - - -
Utilities 332,500 350,000 375,000
Steitioneiry 155,000 100,000 100,000
Insureince 20,000 20,000 20,000
Rent 120,000 132,000 145,200
Peiyroll teixes 15% 675,000 742,500 816,750
Fixture eind fittings 230,000 - -
Legeil fee 50,000 - -
Toteil opereiting expenses (E) 6,116,500 6,328,500 6,935,950
Profit before interest eind teixes (F) = (E) (C) 3,493,500 6,530,875 10,212,488
EBITDEI (F) + ( D) 3,497,500 6,534,875 10,216,488
Interest expense - - -
Teixes incurred G = F x 20%,
25%, 30% 698,700 1,632,719 3,063,746
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Net profit (in Rupees) (H) = (F) (G) 2,794,800 4,898,156 7,148,741
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Net profit (in GBP) 18,632 32,654 47,658

Net profit / seiles % (H) / (EI) 24% 32% 35%

Figure 7: Net profit for three yeeirs

8,000,000

7,000,000

6,000,000

5,000,000

4,000,000

3,000,000

2,000,000

1,000,000

-
Year 1 Year 2 year 3
Net Profit 2,794,800 4,898,156 7,148,741

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EIppendices

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