A 180- Hawker Light Point in KR Market, Bangalore, Karnataka

Project Dates

Implementation Start: December 2007

Project Details

This project concept involves the creation of a new micro enterprise investment, which, located in the un-electrified/under-electrified Hawker’s (street sellers) community in KR Market, Bangalore, will provide lighting to the Hawkers. The hawkers are mostly situated in the parking lot outside the main KR Market and on the pavements near KR Market. Most hawkers currently do not have any source of light with few using kerosene based petromax lanterns, emergency lights and candles. There are more than 200 hawkers in the market within 1 km stretch. The hawkers either work in the dark or close their business after dark, incurring losses as a result of early closure and customers preferring well-lit shops inside the KR Market building.

In this specific instance, the charging will be done by full grid charging. The charging station is at a distance of 1 km from the market and the current capacity for the charging station is designed to be for 50 hawkers. The entrepreneur Mr. Srinivas N has been identified through an existing entrepreneur – Peenya Hawker Light points entrepreneur, Mr. Jayakumar N. Mr. Srinivas is currently an auto driver, and has earlier assisted Bommanhalli Hawker Light points entrepreneur Mr. R Vijayakumar to distribute and maintain his batteries. After assisting Vijayakumar, he decided to set up his own business, surveyed KR Market and chose it as the area of operation due to the large size of the market.

Mr. Srinivas has been provided a loan for 55 batteries, 50 light systems and advance for the charging station by S3IDF.

Project Financials

http://spreadsheets.google.com/pub?key=pwRdPi0mYDcKQPDRqobwJKg


Project Size Details

The entrepreneur will initially start servicing 50 hawkers, expanding the business once the demand for the lights increase.

Project Impact Details

The project will benefit the entrepreneur, currently an auto rickshaw driver and his younger brother who is assisting him in the project. Additionally, the hawkers will also benefit from access to convenient and clean lighting.

Estimated Pre-investment Costs

Total Costs- Rs. 5510

S3IDF costs

Personnel Costs – Rs. 5010

Other costs - Rs. 500

Total S3IDF costs – Rs. 5510


Returns for S3IDF Revolving Fund

8% flat annual returns

Actual returns will be much higher


Project Indicators

Investment Indicators:

Investment size – Rs. 2,46,879

Revolving fund – Rs. 1,96,879

RF to investment size – 80%

Cost Indicators

Total pre investment cost – Rs. 5510

Pre investment cost/Investment Ratio – 2%

Impact indicators

Number of direct beneficiaries – 52 (at the start of the project)

Investment size/no. of beneficiaries – Rs. 4748


Project Risks

Project owner/operator risk:

Mr. Srinivas had been involved with another hawker light points project for more than a year and is familiar with the dynamics of the enterprise. Hence, the risk is less.

Market risk:

Most of the hawkers do not own any source of light at present and the risk might be that they may not be open to new source of light. The hawkers are not using lights because they find the cost prohibiting. However, Mr. Srinivas is confident of targeting those who own candles and petromax lanterns, and the others through them. The lights will also find favour with the hawkers as they are being offered convenient and efficient lighting for the first time. As the market is also very huge, there is less risk of the entrepreneur not finding enough customers. There might be competition risk at a later stage, which can be overcome with superior servicing on the part of the entrepreneur.

Technology risk:

There is no technology risk as the batteries (Shakti batteries) and the light points designed by another entrepreneur, Mr. Jayakumar are being used in his own project without any problems.

Portfolio risk:

There is no portfolio risk.

Mission risk:

There is no mission risk.

Partners

The entrepreneur, Mr. Srinivas N and the battery supplier, Shakti batteries.

Monitoring
Monitoring report done by Arpana in Jan 08
http://docs.google.com/Doc?id=dft8hdgq_0fg7b4nkp

A151.Naganathapura.hawkers.Bangalore

Project Description/Concept: Ramesh is the person who is interested in running the Naganathpura hawkers. Ramesh is the son of Vijay Kumar’s elder sister. Vijay Kumar brought Ramesh to Bangalore from Shimoga about 4 years back. Ramesh is married with a 4 year old daughter. He owns an auto. He uses the auto to supply milk to houses. He supplies 300 lts. Per day and gets 80 paise per liter as commission. He also picks and drops school children from home to school. From these two services he earns, Rs. 6000 + Rs. 1500, that is a total of Rs. 7500 per month. Since the last 6 months he has on his own started running a hawkers light point business. He supplies around 30 light points on a daily basis. The small batteries he was using are now giving only 3 hours of backup due to which he is now losing customers. Since, he does not have the money to invest in batteries now, he came to us for financial assistance.

He needs around 50 batteries and lights to run his business in Naganathpura and has potential to expand his business to 75.

Candidate Investment Site: Naganathpura. This is around 20 km from Bangalore on the Bangalore Hosur highway. It is 5 km from Bomanahalli, where Vijay Kumar is located.

Project Financials
http://spreadsheets.google.com/pub?key=pwRdPi0mYDcLjqdYLOshhPg

Know-how and Technology Partners and Supply Chain Issues: The battery supplier is Mr. Sankar, who assembles batteries near lal bagh main gate. Since Sankar himself assembles batteries, he will be in a position to address any major problem that arises. Mr. Sankar’s works has been visited and seems to be fairly ok and has a decent understanding of the battery business. Mr. Sankar will be giving a warranty of 2 years

In spite of this, there will be the risk of battery failure. Sankar says he will give a guarantee of 2 years. There is always a risk that he will not be able to provide this is all batteries die out at the same time within the 2 year period. This risk will be addressed by the entrepreneur keeping aside Rs. 1000 every month for the battery fund. In addition to this, S3IDF will also keep Rs. 1000 or Rs. 500 aside as the battery risk fund.

Other Partners Stakeholders and Beneficiaries and Related Issues:

Partners: Vijay Kumar, who will do the installation of the batteries and lights and Sankar, the battery manufacturer

The beneficiaries will be Mr. Ramesh, the person running the project and the hawkers of Naganathpura

Implementation and Other Issues: This is a simple project and has little risks as Ramesh is already running the business. The only risk is battery performance.

Single or Multiple transactions:

This is the single transaction with the operator

This is the first transaction with battery supplier, Mr. Sankar

This is multiple transactions with Vijay Kumar

Slab for approval:

KCR

Budget and S³IDF’s exposure:

Sl. No	Item	Approx Cost in rupees	Person months
1.	Personnel costs (Pre-investment and implementation)	Rs. 9000 [- Rs. 4000 (AR)+ Rs. 3000 (Dayanand) + Rs. 2000 (Vijay Kumar)]	20 hrs of AR + 4 days of Dayanand + 8 days of Vijay Kumar
2.	Travel costs (Pre-investment and implementation)	Included above
	Total pre investment costs	Approx Rs. 10000
3.	Personnel & Travel costs for M & E	Approx Rs. 5000
4.	Other costs (Demonstration or new set up or satellite office)
5.	S3IDF revolving fund (Partial Guarantee or Debt or Equity etc)	Rs. 49000

Capital cost of the infrastructure:

Total cost – Rs. 1,10,500/-

S³IDF’s revenue and cost recovery:

Sl. No	Item	Approx Cost in rupees
1.	Guarantee fees
2.	Developer fees
3.	Sales fees
4.	Direct financing profits from interest charged	Rs. 7463/-
5.	Royalty fee	Rs. 4800/-
6.	Profit Sharing
TOTAL		Rs. 12,263/-

Total expenses – Rs. 10,000 and total cost recovery is Rs. 12,000

Timeline:

Sl. No	Item	Estimated Time required	Current Status
1.	Entry into Category B	10 days	Completed
2.	Information gathering on technology and other due diligence	10 days	Completed
3.	Entry into Category A	10 days	Completed
4.	Feasibility analysis and DPR	10 days	Ongoing
5.	Project in implementation	10 days
6.	Project in operation	10 days
TOTAL TIME REQUIRED		60 days

Various Risks:

1. Market risks: Expanding market of hawkers in the area. So, market risk is less. Also, complete grid, so low cost technology

2. Technology Performance risks: Battery performance for 2 years is the biggest. This is being addressed by:

1. Getting battery custom made by a person who is knowledgeable of the workings of the project, who can also repair the batteries if things go bad.
2. Operator will maintain battery fund
3. S3IDF will also maintain a battery fund

3. Organisational risks: Person already running project. Also person is relative of Bomanahalli entrepreneur, Mr. Vijay Kumar. So, personal risk is less

4. Portfolio risks: No significant portfolio risks

5. Mission/Regulator’s perception risk: Is a pro poor project

A69 & A136 Vijay Kumar Hawkers in Bangalore

Project loan repayment excel file.
THis is the latest updated loan repayment file
http://spreadsheets.google.com/pub?key=pwRdPi0mYDcJyT6HrZHiSaQ

A173 Enterprise Support Transaction to install energy efficient stoves in small eatable based home industries in Magadi Taluk, Bangalore

Project Dates

Oct 07

Project Photos

Project Details

Background: Narasimha Murthy P (NMP) is one of the entrepreneurs who has installed energy efficient stoves in the silk sector having taken our support for this purpose. However, due to subsidies not having come from the silk department, his liabilities remain with us, upto Rs. 2.8 lakhs. We have explored legal options to get the liabilities from NMP and believe that recovering the dues from NMP is not in his means. Since, he has the potential to be a biomass oven entrepreneur and S3IDF can look to recover the liabilities by engaging with him, this EST was to utilize NMP’s resources to slowly build his biomass business by adopting a different financial structuring.

There are a number of small home based units in and around cities and towns where people prepare fried food items such as mixtures, sweets etc. these industries need thermal heat the heat oil. The options these units use for the thermal heat are inefficient biomass stoves, kerosene and LPG. However, due to the increasing cost of kerosene and LPG and lack of supply of these fossil fuels, many of these units are struggling to run. This EST will explore installing energy efficient biomass stoves in such units. At Magadi, there is a potential of installing around 10 to 15 stoves. With a profit margin of Rs. 1000 per stove, a total profit of Rs. 10,000 to Rs. 15,000 is expected from installing such stoves in Magadi.

Currently such units in Magadi use kerosene for their thermal needs. One unit spends 10 liters a day on kerosene at Rs. 38 per liter of kerosene.

The names of the customers where the two stoves will be installed are:

1. Narasimaiah, RR Road, Magadi, Ph: 9448297816
2. Umesh, RR Road, Magadi, Ph: 9449350146

One of the biggest challenges in cracking this industry is the lack of awareness of such energy efficient stoves with such units. Also, these units are highly demanding making getting orders from them not a easy task. Since the market potential for this is large, more than 1000 units in South Karnataka it is a market worth exploring.

This EST will start by supporting NMP to install two units at Magadi, a town 60 km from Bangalore. Magadi was chosen as NMP is doing a survey on the behalf of S3IDF to explore the potential of installing biomass stoves in schools who need it for their midday meal program.

The costing of one stove is as follows:

Fabrication (metal) – Rs. 750

Refractory bricks – Rs. 480(1 box)

Fire grade cement – Rs. 550 (10 kg at Rs. 55/kg)

Local bricks – Rs. 225 (75 bricks at Rs. 3/brick)

Mud and cement – Rs. 300

Labour for one day – One mason (Rs. 200/day) and one helper (Rs. 100/day)

Transport and others – Rs. 200

Total – Rs. 2755

Selling price – Rs. 3500

Profit: Rs. 750 per stove

Project Size Details

Two stoves with a selling price of Rs. 3500 each, so Rs. 7500. This could expand to 10 stoves, when the total project cost will be Rs. 35,000

Project Impact Details

The main impact will be reduction in the usage of fossil fuels, Kerosene at the rate of Rs. 10 lts a day. Also, where biomass is used a reduction of atleast 30% in the usage is expected.

Estimated Pre-investment Costs

Total Costs – This will be determined when the project expands.

S3IDF costs

Personnel costs

Other costs

Total S3IDF costs

Partner costs

Personnel costs

Other costs

Total Partner costs

Returns for S3IDF Revolving Fund

This will be determined when the project expands.

Project Indicators

This will be determined when the project expands.

Investment indicators:

Investment size –

Revolving fund –

RF to investment size –

Cost Indicators

This will be determined when the project expands.

Total pre investment cost –

Pre investment cost/Investment Ratio –

Impact indicators

No. of direct beneficiaries -

Investment size /no. of beneficiaries –

Project Risks

This will be determined when the project expands.

Project Owner/operator risk:

Market risk:

Technology risk:

Portfolio risk:

Mission risk:

Partners

NMP

A160 projects - Enterprise support transaction to provide infrastructure services at Puttur, Kundapur and other cities

Projects:

• Enterprise support transaction to provide infrastructure services (A160a) at Puttur, Dakshin Kannada District, Karnataka
• Enterprise support transaction to provide infrastructure services (A160c) at Sagar, Shimoga District, Karnataka
• Enterprise support transaction to provide infrastructure services (A160d) at Mysore, Mysore District, Karnataka
• Enterprise support transaction to provide infrastructure services (A160b) at Kundapur, Udupi District, Karnataka
• Enterprise support transaction to provide infrastructure services (A160f) at Raichur, Raichur District, Karnataka
• Enterprise support transaction to provide infrastructure services (A160h) at Davangere, Davangere District, Karnataka

Project Dates
First time draft – September 13, 2007

Project Photos

Project Financials
http://spreadsheets.google.com/pub?key=pwRdPi0mYDcLn6RaHFd72AQ

Project Details
This project is to develop multiple entrepreneurs in the state of Karnataka who will sell products in the infrastructure space to the bottom of the pyramid market. The customers of the products will be households and small businesses (petty shops, roadside hotels and bakeries). The products will be from one of the following sectors: telecom, energy efficiency, water, renewable energy, cooking and heating. To stock and sell the products, the entrepreneurs will be given working capital support from local banks. S3IDF will facilitate working capital support for the entrepreneurs from local banks by providing security in the banks in the form of fixed deposit. Wherever possible, the entrepreneurs will sell their products on a cash basis and where required financing for the products will be provided through local banks and micro finance institutions. In addition to providing the entrepreneurs financial support, S3IDF will provide business development assistance to the selected entrepreneurs.

To get scale economies, S3IDF could use its SPV, S3IDF Infra serve to buy products in bulk and then supply to the entrepreneurs. The products could include the following: pressure cookers, public coin phones, mobile phones, candle based water filters, LPG stoves, LED lanterns, solar lanterns, single phase flour mill etc.

Project Size Details
The working capital loan to be provided to each entrepreneur from a local bank will be between Rs. 100,000 to Rs. 200,000. It is expected that at least 10 entrepreneurs will be selected and supported for this initiative from July 07 to July 08. On this basis, the total project cost will be between Rs. 10 lakhs to Rs. 20 lakhs.
Details of the entrepreneurs are as follows
http://spreadsheets.google.com/pub?key=pwRdPi0mYDcKO-8IYnCCNAA

Project Impact Details
This project will provide employment to at least ten entrepreneurs
Each entrepreneur will reach an average of 20 customers in a month, in a year h/she will reach around 200 customers. So ten customers will reach 2000 customers

Estimated Pre-investment Costs
Total Costs – Rs. 432400

S3IDF costs
Personnel costs – Rs. 200400
Other costs – Rs. 40000
Total S3IDF costs - 240400

Consultant costs
Personnel costs – Rs. 160000
(two consultants at Rs. 10,000 per month for 8 months)
Other costs – Rs. 32000
Total Consultant costs - 192000

Returns for S3IDF Revolving Fund
Annual percentage returns for RF – 29%

Project Indicators
Investment indicators:
Investment size – Rs. 10,00,000
Revolving fund – Rs. 5,00,000
RF to investment size – 50%

Cost Indicators
Total pre investment cost – Rs. 4,32,400
Pre investment cost/Investment Ratio – 43%

Impact indicators
No. of direct beneficiaries – 10 (number of entrepreneurs)
No. of indirect beneficiaries – 2000 customers from 10 entrepreneurs
Investment size /no. of beneficiaries – Rs. 500

Project Risks

Project Owner/operator risk:
The risk of the entrepreneur who will be the project owner is the biggest risk of this project. The risk is that the entrepreneur misuses the support provided to him or proves to be incapable to deliver as per expectations. To reduce this, we will be following a rigorous selection process for selecting entrepreneurs. This will ensure only the most suitable are selected. Additionally, the support provided to the entrepreneur will be backed up by necessary legal documents so that immediate legal action can be taken if the entrepreneur does not go as per the agreed terms and conditions. Also, the performance of the entrepreneurs will be closely monitored on a regular basis (weekly).

Market risk:
Since we will be focusing on the bottom of the pyramid market, which is largely untapped, this risk will be less. In case at a particular location, such a risk arises, the products will be shifted to another location.

Technology risk:
We will be dealing only with such technologies where the risk is minimal. That is technologies selected will be commercially proven technologies

Portfolio risk:
No portfolio risk

Mission risk:
No mission risk

Partners
Entrepreneurs, local banks and manufacturers of products in the telecom, energy efficiency, water, renewable energy, cooking and heating sectors.

A169. Provision of pressure cooker at Laggare, Bangalore, Karnataka

Project Description/Concept
This project is a replication of an earlier project of supplying pressure cookers to poor households in Nayakanahatti village, Chitradurga. Pressure cookers are energy saving cooking devices and hence using them will reduce the consumption of LPG and kerosene. Laggare is a low income suburb in Bangalore city with a population of around 50,000. A large number of women in Laggare are employed in garment factories in Bangalore. A survey conduced with households at Laggare indicated a desire among the households with LPG and kerosene stoves to go in for pressure cookers. The households, although aware of pressure cookers were constrained by the initial investment necessary for owning pressure cookers. This concept is to help make pressure cookers accessible to the households by solving their first cost constraint by making it possible for the households to pay for the pressure cookers in monthly installments.

Project Financials
http://spreadsheets.google.com/pub?key=pwRdPi0mYDcJJYazL41_DFQ

Specific Investment Site
The project is for households at Laggare, a low income suburb in Bangalore city with a population of around 50,000 .. The distribution of pressure cookers and the collection of monthly installments will be done by a women entrepreneur, P H Manjula who does business of selling sarees for a living.

Partners Stakeholders
P H Manjula is the main partner for the project. The supplier of Nandi pressure cookers at Bangalore is another partner for the project.

Benefits and Beneficiaries
The direct beneficiaries of this project will be the women of Laggare. Using the pressure cooker will reduce the time taken to cook and also reduce the fuel consumption and hence fuel costs. Reduction in GHG emissions will be another benefit of the project.

Final costs and Financing Arrangements
The cost of a five liter pressure cooker is INR five hundred and seventy five. The project involves providing ten households with pressure cookers. The households pay an initial amount of INR seventy five and the remaining amount in four installments. The total cost of the project is INR five thousand seven hundred and fifty.

Various Risks
Market Risk: The market risk is for a lower cost pressure cooker coming in. This is highly remote as the sourcing of the pressure cooker has been done directly from the manufacturer. Also, it is very unlikely for any other provider to provide pressure cooker on a lease to purchase basis.
Organisational risks: This risk is that the entrepreneur, P H Manjula will not be able to run the business of selling pressure cookers and collect the installments. Due deligence of Manjula has been done and only then she has been supported. Also, in the first phase of the project the size of the project has been kept low to minimize the risk.
Portfolio risks: S3IDF has few such projects providing pressure cookers. Therefore, the portfolio risks for S3IDF is minimal from this project.

Conclusion
Operator’s Perspective: Since the Manjula knows the customers, the risk of non repayment of the lease is minimal. For manjula this is additional income and a potentially new business opportunity.
The Beneficiaries Perspective: Although the beneficiaries were aware of pressure cookers, they were not in a position to pay the full amount in one go. Providing lease finance helped them to afford the cookers.
S3IDF’s Perspective: For S3IDF, through this project, poor households are being provided with pressure cookers which are energy efficient and reduce the time it takes to cook. In this way the project fits S3IDF’s mission of providing infrastructure services to the poor.

A75t. Provision of transportation vehicle for transporting milk and goods in Chitradurga district

Project Photos

Milk being collected at Nayakanahatti milk collection center

Milk being loaded on to the collection van

The milk collection van

Project Dates
First draft August 24, 2007

Project Financials
http://spreadsheets.google.com/pub?key=pwRdPi0mYDcLGKpSLgpSWLw

Project Details
Transportation is a critical infrastructure need in rural areas. Transportation facilities are required for two primary purposes. One is to transport people as people need to move from the smaller dispersed villages to the larger economically active villages and town centers for finding work(labour), reaching markets for selling and buying goods and for accessing services such as health. The other need for transportation is to transport goods into and out of the villages. Due to the dispersed nature of the villages, low volumes from each of the villages, inability of the villagers to do the large investments for transportation vehicles and lack of financing for such investments, there is a shortage of transportation vehicles serving smaller and remote villages.

This project is to invest in a goods transportation vehicle to transport milk and goods. In the district of Chitradurga and in it, in the taluk’s of Challakere and Molkalmuru there are ‘milk routes’ in which milk is collected from various villages and delivered to the closest chilling station. Two routes in these taluks are open for sale, that is, the existing person doing the transportation wants to come out of the business. The reasons for this are multiple. The main reasons are the following:
The milk cooperative in Karnataka (Karnataka Milk Federation-KMF), which is the buyer of the milk, gives a minimum rate for transporting the milk. KMF makes a 15 days delayed payment which reduces the attraction for a commercial player
The business has a risk in that, the vehicle has to be run on all days of the year. The loss from a day’s absence needs to be borne by the transporter. To ensure that there is no absenteeism, old poorly maintained vehicles cannot be used.
The milk has to be delivered to the chilling center on time. Late delivery could mean rejection of the entire load. This means a disciplined transportation service, which is not easy for most people
The roads in the route are not very good. Due to this, commercial players are not ready to put their new vehicles on this route.

The route for which the vehicle will be put is the Gaursamudra-Nayakanahatti-B G Kere route. The total distance of this route is 134 km. The route covers the following villages-Gaursamudra, Chikhalli, Ullarthi, Karikere, Mirabayanahalli, Paramsagara, Talaku, Timapanahalli, Gajunahalli, Nayakanahatti, Mallurhatti, Kamadalgudi, Salahalli, Chikamalahole, Abbanehalli and B G Kere. The vehicle needs to do two trips in a single day. One in the morning which starts at 6.00AM and ends at the chilling station at 10.20AM and the other in the evening from 6.00PM to 10.20PM. The total amount of milk collected in one trip is around 500 liters. KMF, the buyer pays for the transportation at the rate of Rs. 5.8 per km.

To improve the utilization of the vehicle, the vehicle will also be used when it is free to transport goods to and fro from Nayakanahatti village to the main cities of Davengere, Challakere and Chitradurga. The vehicle will require two people, one driver and one helper

Due to the fact that transporting milk is not commercially very attractive, the difficult nature of the business, and the extent of financing required, there is a gap which S3IDF will help to fill. S3IDF’s SPV will initially invest in the project. The SPV will get a bank loan for the vehicle from the local regional bank, Pragathi Gramin bank.

Some important details:
Phone no. of Shimoga KMF - 08182-246161, 08182-246163
Person incharge of transportation in Shimoga - Nagendrappa - 9449867180. Spoken to him. Seems responsive

Project Size Details
The vehicle which will be bought is a TATA 407. This has a capacity of around 5.5 tons. The price of the vehicle is around Rs. 5,35,000 with registration. A deposit of Rs. 35,000 needs to be paid to KMF, which is refundable.

Project Impact Details
The transportation vehicle will benefit atleast 15 households in each village where it goes for milk collection. Therefore in total the project will benefit directly 240 households. With an average of 5 per household, the project will benefit 1200 people. Another impact of this project is that it will give continuous employment to two people, the driver and helper of the vehicle.
Doing this project has the potential to have multiple benefits. Once S3IDF understands the dynamics of this project, we can encourage more people to get into the dairy industry by assisting further investments in the dairy industry, investments from transportation to chilling units to a dairy.

Estimated Pre-investment Costs
Total Pre investment costs = Rs. 21340
S3IDF costs
Total Costs=Rs. 6340
Personnel costs=Rs. 3340
Other costs=Rs. 3000
Partner costs
Total Costs=Rs. 15000
Personnel costs=Rs. 10000
Other costs=Rs. 5000

Project Returns
The project returns are above 30% per annum. Since this is the first project, the actual returns could be different from what has been estimated. However, it should be greater than 25% per annum.

Project Indicators
Investment indicators:
Investment size – Rs. 5,70,000
Revolving fund – Rs. 3,13,500
RF to investment size – 55%

Cost Indicators
Total pre investment cost – Rs. 21,340
Pre investment cost/Investment Ratio – 4%. This is very good as our target is 10%.

Impact indicators
No. of direct beneficiaries – 1200 people(240 households)
Investment size /no. of beneficiaries – Rs. 475 per beneficiary

Project Risks

Project Owner/operator risk:
We are dependent on CRWCWS to run the project and CRWCWS in turn is dependent on the drivers and the helpers to run the project. This raises the operator risk. There is a risk that due to the negligence of the driver, milk is not delivered on time and we have to bear the losses. However, since CRWCWS has shown that it is capable to select good operators, we can take this risk. For managing the risk of accident or theft of the vehicle, the vehicle will be insured.

Market risk:
Once we get into an agreement with KMF, the market risk is minimal.

Technology risk:
No technology risk

Portfolio risk:
No portfolio risk as this is among the few transportation projects

Mission risk:
No mission risk as it is a pro-poor project. The vehicle helps poor households in small and remote villages

Partners
KMF, CRWCWS, PGB

Monitoring
Actual cash flows from the project till Dec 07
http://spreadsheets.google.com/pub?key=pwRdPi0mYDcIIpkVZ4AVCDw

A150a. Single Phase Flour Mill machines with Punjab National Bank for women entrepreneurs and small enterprises, Shimoga District, Karnataka

Project Dates
First draft September 14, 2007

Project Photos

Project Financials
http://spreadsheets.google.com/pub?key=pwRdPi0mYDcLtrXGa5YBfTw

Project Details
The flour milling business is widely prevalent in rural & urban areas, where grains such as wheat and rice are ground. The traditional flour mill is a bulky machine which requires three phase power supply to run. Due to the combined cost of the flour mill and for the three phase connection, the cost of installing a conventional flour mill is high and investing in this business is not affordable to most people. For instance, cost of 3-phase flour mill is about Rs. 25,000-45,000, while the 3 phase electricity connection cost approximately Rs. 25,000, in addition to a requirement of about 200 sq ft. space for installing and operating the business. So the total installation and operating cost could reach up to Rs. 60,000- 1,00,000. Also, the need for three phase does not make it possible to install the machine at small villages where three phase connection is not always available.

This project is to diseminate a small capacity flour mill which runs on single phase power supply. Due to its small capacity, and ability to run on single phase power supply, the cost of the machine is much lesser than a conventional flour mill and makes it possible for smaller entrepreneurs to buy it and run it as a small business. Also, it becomes possible for these single phase flour mills to be installed in villages. The total cost of a single phase flour mill is Rs. 15,000.

Pre-investment Process and Investment Development
The investment procedure will be as follows:
1. The dealer identifies potential customers who are interested in buying the flour mill but cannot afford a one-time payment and require financial assistance.
2. S3IDF does a due diligence on such customers and selects only such customers who satisfy its pro poor criteria.
3. This selected list of customers is provided to the local bank for loan financing. The bank in turn does its due diligence of the selected customers.
4. S3IDF places a certain pool of money in the local bank, which will be utilized to provide partial guarantee to each selected customer for whom the bank will give loan. The guarantee amount will be a specified percentage of the loan amount.
5. The target number of customers to be provided with loan and the time period for which the pool of money will be placed in the bank will be decided at the start. If the numbers are not reached, the pool of money will be withdrawn.

Technology/product
The technology is from Navdeep products in Daman. While the machine was introduced by Navdeep in the year 1988, it made its advent in Karnataka only in 2000. The machine has a good distribution network throughout Karnataka. The machine presently has a 1-year warranty, with not much history of regular breakdowns. The machine is available in different capacity ranges such as 1HP, 2 HP and 3HP.

Project Size Details
From this project 10 poor entrepreneurs are expected to get bank financing for owning flourmills. From 10 machines, the total project cost is expected to be Rs. 155000.

Project Impact Details
The project will have 10 direct beneficiaries. The 10 beneficiaries will be the 10 entrepreneurs who will own the flour mills through bank financing. Each flourmill is expected to serve 50 customers. So, the project will have 500 indirect beneficiaries.

Estimated Pre-investment Costs
Total Costs – Rs. 24700

S3IDF costs
Personnel costs – Rs. 16700
Other costs – Rs. 8000
Total S3IDF costs – Rs. 24700

Partner costs
Personnel costs
Other costs
Total Partner costs

Returns for S3IDF Revolving Fund
Annual percentage returns for RF – 26%

Project Indicators
Investment indicators:
Investment size – Rs. 1,55,000
Revolving fund – Rs. 58,125
RF to investment size – 38%

Cost Indicators
Total pre investment cost – Rs. 24700
Pre investment cost/Investment Ratio – 16%

Impact indicators
No. of direct beneficiaries - 10
Investment size /no. of direct beneficiaries – Rs. 15,500

Project Risks

Project Owner/operator risk:
This is the risk of the entrepreneurs who will own the machines not running the flourmill business well and defaulting on the loan repayment. The 10 entrepreneurs will be selected through a robust selection process where, first the dealer selects potential entrepreneurs, these potential customers of flour mills and bank loans are then checked by the local bank. Once the bank checks them, S3IDF does a final check on the potential entrepreneurs. Only if the entrepreneurs are oked by S3IDF, will loan financing be provided to the entrepreneurs.

Market risk:
This is a possible risk. The entrepreneurs have been made aware of this risk, which would arise when there are too many flour mills and there is not enough business for them. As of now there is sufficient market for flour milling. This is a risk which could arise in the next 2 to 3 years.

Technology risk:
There is no technology risk as it is a commercially proven technology

Portfolio risk:
No portfolio risk

Mission risk:
No mission risk

Partners
Anand Distributors, dealer in Shimoga of Navdeep products, Punjab National Bank, Shimoga and the flour mill entrepreneurs

A75m. Expansion of Telecom services at hamlets around Nayakanahatti, Chitradurga District, Karnataka

Top Picture - Mallikarjuna's coin phone
Second from top picture - Hemaanna's coin phone

Project Dates
Implementation dates - August and September 07

Project Details
This project is similar to A75c and A75j. This project will provide coin phones to 33 poor customers in and around Nayakanahatti

The list of beneficiaries are as follows:

1 Shantha kumar M
2 Ningappa M
3 Swamy M
4 Lakshmidevi F
5 Bommalingappa M
6 Basaraju M
7 Niranjana M
8 Ramakrushna M
9 Mookamma F
10 Shashi M
11 Revanna M
12 Obanna M
13 Jogappa M
14 Thippeswamy M
15 Manjunatha M
16 Janakamma F
17 Bosaiah M
18 Thippeswamy M
19 Somlabai F
20 Kamalamma F
21 Suvarnamma F
22 Sharanamma F
23 Thippeswamy M
24 Manjappa M
25 Hemanna M
26 Thippeswamy M
27 Rajashekar M
28 M.K. Suma F
29 Jayanna M
30 Sivanna M
31 Yallamma F
32 Thippeswamy M
33 Sannapalaya M


Project Financials
http://spreadsheets.google.com/pub?key=pwRdPi0mYDcJEpfkDJyvRUQ

Project Size Details
The total size of the project will be Rs. 97978

Project Impact Details
The project will impact 33 households.

Project Risks

Project Owner/operator risk:
The operator of this project is CRWCWS. CRWCWS has been a partner of S3IDF for 2 yrs. CRWCWS has a good track record with S3IDF and hence there is little operator risk

Market risk:
There is very little market risk as there is a large untapped market

Technology risk:
There is no technology risk

Portfolio risk:
There is no portfolio risk

Mission risk:
There is no mission risk

Partners
CRWCWS

A137 Three wheeler transportation for hawker light point and villagers transportation services at Chitradurga District, Karnataka

Project Dates
Revision date: First time approval – 16 May 07
Implementation - July 07
Operations - Feb 08


Project Description/Concept: Chitradurga has a hawkers project. The batteries are being supplied by a very reliable auto driver from the past one year. His name is Prabanna, age is 53 years and comes from a close by village called Malapahahatti, 3 km from Chitradurga. He currently pays a rent of Rs. 120/day for the auto that he uses. He now wants to go in for own auto.

Project Financials
http://spreadsheets.google.com/pub?key=pwRdPi0mYDcKsSm1101hxfg

Candidate Investment Site: Chitradurga town

Know-how and Technology Partners and Supply Chain Issues: Bajaj petrol 3 wheeler auto

Other Partners Stakeholders and Beneficiaries and Related Issues:
CRWCWS is one of the stakeholders as the hawkers project is run by them. Canara Bank is another stakeholder as it is the bank giving loan
IS CRWCWS backing this person ?
Implementation and Other Issues:
The cost of an auto is Rs. 83,000. Bank requires a margin of 25%, which Prabanana does not have. Prabanna is also eligible to get assistance from the Backward Caste Welfare Office (BCWO) from a scheme called Chaithainya self employment. BCWO provides a subsidy of Rs. 5000 and a loan of 20,000 at an interest rate of 4%. The assistance of BCWO is routed to the bank. Payments will need to be paid to the bank.
1 is the auto a brand new one?
2. Is it goods auto or passenger auto ? If passenger auto is being planned to be purchased, we may have some risk if passenger auto is used for transporting goods. Usual insurance clauses clearly indicate that the vehicle shouldn’t be used for transporting goods, particularly of inflammatory in n ature.
Getting BCWO assistance takes time. BCWO has agreed to provide assistance to Prabanna, but it is not clear when this will come. The bank is also ready to give loan if 25% margin is provided and a guarantee equal to 20% of the project cost.
Since, Prabanna is know from the past one year and has been very reliable, S3IDF can assist him for the margin money and gaurntee amount. Also, our intervention will help Prabanna to get loan independent of the BCWO assistance, when it will come is uncertain. Prabanna now earns Rs. 40 per day from the hawkers project. Our assistance can be structured so that our repayments come through the payments Prabanna should receive for his services to the hawkers.
Financeing for an auto is a mainstream lending activity which any bank or financing agency can do. S3IDF funds need not be used for this kind of mainstream financing. Moreover since finacing facility through BCWO is available, I feel Prabanna should use that avenue. Regarding time loss as to when he gets the subsidy is not really an issue, as he is already getting an auto on hire. He can file the application and in the meantime continue to use the hired auto.

Age of Prabanna is also a concern as he is already 53 years. This age is also important from the point of view of savings he should have made by now, if he has any plans to buy his own auto prior to approaching S3IDF. Atleast some amount of savings proof will give us some certainity of his financial savings to repay the loan.


Capital cost of the infrastructure:
Rs. 84,400 for a 3 wheeler


Various Risks:
1. Market risks: Low market risk as Prabanna is already established with existing auto
2. Technology Performance risks: standard product, so no technology risk
3. Organisational risks: Prabanna has been very reliable not having missed even a single day in the delivery of batteries. He does not have any bank loans and has good credit history. What is source of the credit history. Is it the Canara Bank which proposed to lend loan.
4. Portfolio risks: No portfolio risk
5. Mission/Regulator’s perception risk: Prabanna is poor and currently earns Rs. 150 per day.

In the cashflows that are attached to this PAD, if the revenue and fuel costs are linked in term of kilometers that could likely to cover, we can be more sure of the fuel costs.

Transaction Diversity and target for existing donors:
1. Is a transportation project, so adds to diversity
2. Helps achieve donor targets

A75k. Expansion of providing pressure cookers to households in and around Nayakanahatti, Chitradurga District, Karnataka

Top Picture - Nagarathnamma with her pressure cooker
Second Picture from top - Manjula with her pressure cooker

Project Dates
First time approval – 16 May 07
First revision: 23 May 07
Project in implementation – July 07

Project Details
This project is a follow up of project A75f, which was the supply of pressure cookers to residents of Nayakanahatti. With A75f, 25 pressure cookers were sold to poor residents of Nayakanahatti on a lease to purchase basis.

In this project, 22 pressure cookers will be sold to households in Nayakanahatti by CRWCWS (Chaitanya) NGO. All the pressure cookers will be sold through a single one time payment.

The list of beneficiaries:

1 Annamma
2 Vijayamma
3 Leelavathi
4 Nagarathnamma
5 Manjula
6 Gayathramma
7 Aparna
8 Shanthamma
9 nagendramma

10 Sunandamma
11 Hanumakka
12 Vimalakshi
13 Padma
14 Asha
15 Arunamma
16 Shambavi
17 manjula
18 Umadevi
19 Thippamma
20 Thippamma
21 Mamthaj
22 Shilpa


Project Financials
http://spreadsheets.google.com/pub?key=pwRdPi0mYDcK8ErMc9af9AA

Project Size Details
The total project cost is Rs. 12,485

Project Impact Details
The project delivers pressure cookers to 22 poor households. Therefore the project directly impacts 22 households.

A69 Bommanhalli Hawkers Light Point Reinvest

Vijay Kumar has a bank loan in Canara Bank for Rs. 1,42,000 (approx.). The loan is for 3 years and the monthly EMI to be paid is Rs. 4030. In addition to the bank loan, S3IDF has also given Vijay Kumar a direct loan(A136) for Rs. 1,30,000 with a monthly EMI of Rs. 4443 starting from Feb 07. Till end July 07, his repayments for the S3IDF loan was as follows

	Repayment to be made	Payments made	Payments to be made
February-07	4,443	4000
March-07	4,443
April-07	4,443	4000
May-07	4,443
June-07	4,443	4000
July-07	4,443	4000
	26,659	16,000	10659

Therefore as of beginning August his default was Rs. 10,659 to S3IDF and the bank default as of beginning August was Rs. 21230. Therefore the total default at the beginning of August 07 is Rs. 31889(Rs. 10659+ Rs. 21230). Taking the default amount and doing a refinance, the total loan to Vijay Kumar from August 07 was Rs. 145889.

Details of new loan to Vijay Kumar

Earlier loan amount	130000
Repayment done	16,000
Additional loan	31889
Total loan	145,889
Rate of interest	14%
Loan term (months)	36
Monthly EMI	4,986

Project Financials
http://spreadsheets.google.com/pub?key=pwRdPi0mYDcInfnLRwP-6CA