Multi Sports Complex

GROUP 4
JAWAHAR P 1810024
SUDHANSU SEKHAR NAHAK 1810048
S SYLESH 1810041
ADITYA SIL 1810006
DIVYANSHU SHEKHAR 1810021
 Indoor Multi Sports Complex in Chennai, Tamil Nadu

What is the Project?

• Multi sports complex providing best in class facilities & Equipment in Chennai.
• Unique premium experience for the sports enthusiasts.
• The facility consists of Cricket Nets, football turf, badminton Courts,
basketball courts, rock-climbing wall and open space for cross-fit activities.

Why this Project?

• Multi Sports Facilities are becoming a necessity in Tier-1 cities in India.
• Difficulty in finding playing spaces faced by Urban Youth & Millennials.
• Increasing awareness about the importance of staying fit and leading a
healthy lifestyle.
• Analyst estimated the market size to be around INR 300 billion in 2015.
DIRECT COSTS
• Infrastructural (Lease) = 1.2 crores
• Labor cost (salaries) = 15.84
lakhs/year
• Equipment Cost = 2 lakhs/year
• Maintenance Cost = 4 lakhs/year
• Marketing Cost = 18 lakhs/year
• Utility Costs(electricity, telephone,
water etc.) = 15.2 lakhs/year
DIRECT BENEFITS
• Profit earned = 6.2 Lakhs for first
year
• Revenue generated by leasing
advertising space in the facility
• Revenue by sales through
vending machines
• Revenue generated by events
INDIRECT COSTS INDIRECT BENEFITS

• The costs incurred by the mall • Play area for children in

initially so as to make the top congested urban setup
floor suitable for leasing out.
• Weekend destination for
millennials
• Generating more footfall for all
the shopping outlets and eateries
inside the mall
• Additional Parking revenues
generated by increased footfall.
INTANGIBLE COSTS INTANGIBLE BENEFITS

• Heavy usage of essential • Improve the physical and mental

resources like electricity and wellbeing of the customers
water
• This will create an environment
for competitive sports
• Increased passion for sports in
India
NPV AND IRR Calculation

• Net present value of sport complex is approximately 80.30 lakhs.

• Internal Rate of Return ~ 15%
• WACC = 0.3*0.15 + 0.7*0.14*(1-0.3)
= 11.36%
• Assuming cost of equity as 15% (As cost of equity is typically greater
than the cost of debt which was around 14% & the beta is unknown)
• As the IRR is greater than the WACC, the project can be undertaken as
the financing will be covered.
Thank you