Model sheep farm project report 50 plus 2


Sheep is a multi-utility animal used for the production of fleece, meat,  skins, and manure. They don’t require costly structures to house them. Sheep are sparing converter of grass into meat and fleece. The structure of their lips causes them to clean grains lost to collect time and in this way convert waste feed into gainful items. Sheep eat different types of weed plant. This makes them phenomenal weed destroyer. They don’t damage plant like goats. They thrive well even under bad management practices. Unemployed youth can adopt sheep rearing as a source of gainful employment.

This sheep farm project report for 50 animals is based on the following assumption.

1-   Adult healthy Ewes& Ram (mutton type breed) within 2 years of age will be purchased

2-   Manure produced in the farm will be utilized for fodder cultivation

3-  In case of death of adult Sheep, the new animal will be purchased from insurance claim money

4-  The entrepreneur will manage animals with proper care and attention.

5-0.5 hector of irrigated land is prerequisite for the project.

Subsidy for sheep farming:- Both central and state government assistance  is available for  sheep farming.Back ended capital subsidy 25% for general category (33.33% for SC/ST/BPL beneficiaries) is available under government of India scheme Integrated Development Of Small Ruminants And Rabbits (IDSRR-EDEG). Subsidy ceiling is Rs125000/- for sheep farm with 50 ewes and 2 ram.

Techno-economic parameters
System of rearingSemi-intensive
No. of Ram2
No. of Ewes50
Age at Maturity (Months)11
Lambing/ interval (Months)8
No of laming/year1.5
Sex ratio1:1
Mortality(%) Lambs5
Saleable age of lambs (months)11
Expenditure norms
Space requirement sqft.per head for Ram20
Space requirement sqft.per head for Ewe10
Space requirement sqft.per head/lamb4
Cost of construction (Rs.persft)     Ewe, Ram Lambs200
Cost of equipment (Rs.per adult animal)50
The purchase price of ewe4500
The purchase price of Ram6500
 Cost of green fodder cultivation (Rs./hector/year)30000
Concentrate feed : Adult Ewes (one month before breeding and one month after lambing i.e. per lambing)6.75 kg/ month
Concentrate feed for Ram (two months per breeding ram)7.5 kg per month
Concentrate feed for Lambs (for 30 days)3.75 kg per lamb
Cost of conc. feed (Rs./kg)18
Labour (No.)One( part time)
Labour wages (Rs.per month)3000
Insurance (as a percentage of the cost of breeding stock)5
Veterinary aid (Rs./adult/year)100
Income norms :
Sale price of Buck/(11month)3800
Sale price of Ewe/(11month)3500
Income from manure is not assumed as it is used on the own farm for fodder cultivation.
Sale of Gunny bags (Rs./bag)10
Repayment norms:
Repayment period (years)6
Grace Period (years)1
Interest rate(%)12
 Sl. No. ParticularsYear
 A.Opening Stock – Adult Rams2222222
Adult Ewe purchased stock50505050505050
 B.No of lamb born858585858585
Male Lambs515151515151
Female Lambs515151515151
Male Lambs555555
Female Lambs555555
 D.Sale of young lamb
A-Capital cost(Amount in Rs.)
Construction low cost  Shed for 50 Ewes  @ 10sq.ft/adult Ewe(Rs.200/sq.ft)100000
 Construction of  Shed for 2 Ram@20sq.ft/buck(Rs.200/sq.ft buck shed )8000
Construction of Shed for 52 lambs @4 sq.ft./ lambs @(Rs.200/sqft73600
Equipments feeding trough buckets etc5000
Cost of 50 Ewes@ 4500/Ewe including insurance and transportation225000
Cost of 2 Ram@6500/buck                           13000
TOTAL CAPITAL COST                                                            424600
Working Capital
Wages for part time  labour @3000/month  for 1 year36000
Cost of concentrate feed for 50Ewes @6.75kg/month/Ewe for two months12150
Cost of concentrate feed for 2 Ram @7.5kg/adult animal for two months 540
Cost of concentrate feed for 92 lambs@3.75 kg/lamb /month i.e  900kg6210
Fodder cultivation in 0.5 hector  of land15000
Misc, expenditure i.e.  vaccine medicine and veterinary aid and electricity15000
Total Working Capital                                                           95400
TOTAL PROJECT COST                       520000
Bank loan 85@% of the project cost442000
Margin money @15 % of the project cost    78000
CASH FLOWProject period (year)   Amount in Rs.
Wages for  labour (part time)3000/month36000360003600036000360003600036000
Cost of insurance 5% of animal cost     first year Included with purchase0119001190011900119001190011900
Cost of concentrate feed for buck Ewes and lambs18900189001890018900189001890018900
Fodder cultivation 0.5 hector15000150001500015000150001500015000
Misc, expenditure i.e.  vaccine medicine and veterinary aid electricity15000150001500015000150001500015000
Total expenditure84900968009680096800968009680084900
Sale price of male young Male @ 3800/-174800174800174800174800174800174800
Sale price of Young female @3500/-161000161000161000161000161000161000
Sale price of gunny bag230230230230230230230
Value of closing stock, @ average 3000/adult& 1500/lamb232500
Value of shed (10% depreciation/year)54480
Value of equipment

(20% depreciation /year)

Gross profit-84670239230239230239230239230239230538110
Capital Costs424600
Recurring Cost84900968009680096800968009680084900
Total Costs509500968009680096800968009680084900
Net Benefit-509270239230239230239230239230239230538110
Sl noFinancial indicatorsEstimated valuePreferred value
1Net Present Worth (NPW481987.33Should be +ve
2Benefit Cost Ratio(BCR)1.62:1>1
3Internal Rate of return (IRR)29.35%>15%
4Debt Service Coverage Ratio (DSCR)2.17>1.5

Loan Repayment  for 50 +2 animal  sheep farm:- Repayment of loan will start after grace period of one year. Total loan repayment period is 6-7 years. Details of  monthly installment, interest payment, principal payment and balance  is given in repayment schedule for 50 sheep.

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