The document proposes investing unplanned cash in unit trusts offered by BRITAM and CIC that have historically earned annual returns of 10-11%. It also proposes purchasing 10-20 acres of cheap land for speculation and rearing bulls, targeting land valued between KES 50,000-100,000 per acre. A table estimates the cash outflows and returns over 5 years for purchasing land and 45 bulls, showing a net loss after 5 years but the principal being paid back in year 5. A second proposal suggests targeting more expensive land valued KES 1-2 million that could be disposed of or developed within 4-6 years.
The document proposes investing unplanned cash in unit trusts offered by BRITAM and CIC that have historically earned annual returns of 10-11%. It also proposes purchasing 10-20 acres of cheap land for speculation and rearing bulls, targeting land valued between KES 50,000-100,000 per acre. A table estimates the cash outflows and returns over 5 years for purchasing land and 45 bulls, showing a net loss after 5 years but the principal being paid back in year 5. A second proposal suggests targeting more expensive land valued KES 1-2 million that could be disposed of or developed within 4-6 years.
The document proposes investing unplanned cash in unit trusts offered by BRITAM and CIC that have historically earned annual returns of 10-11%. It also proposes purchasing 10-20 acres of cheap land for speculation and rearing bulls, targeting land valued between KES 50,000-100,000 per acre. A table estimates the cash outflows and returns over 5 years for purchasing land and 45 bulls, showing a net loss after 5 years but the principal being paid back in year 5. A second proposal suggests targeting more expensive land valued KES 1-2 million that could be disposed of or developed within 4-6 years.
The document proposes investing unplanned cash in unit trusts offered by BRITAM and CIC that have historically earned annual returns of 10-11%. It also proposes purchasing 10-20 acres of cheap land for speculation and rearing bulls, targeting land valued between KES 50,000-100,000 per acre. A table estimates the cash outflows and returns over 5 years for purchasing land and 45 bulls, showing a net loss after 5 years but the principal being paid back in year 5. A second proposal suggests targeting more expensive land valued KES 1-2 million that could be disposed of or developed within 4-6 years.
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No.
List 1 Investment in Unit Trusts (For Cash Flow Management) 2 Purchase of Land (Option 1 - Hybrid) 3 Purchase of Land (Option 2 - Pure Speculation) CURRENT STATUS OF FUNDS The Company currently invests in a savings account with Standard Chartered Bank at a rate of 1%. The Money Market Fund offered by various Companies offer a much better return. Our focus is mainly on BRITAM and CIC Unit Trusts which last year offered annual returns of 10.23% and 11.10% respectively.
THE PROPOSAL Any unplanned for cash should be invested in unit trusts should be invested in the money market fund in the Company selected (BRITAM). This should apply to any unplanned for cash. A reserve should however be retained based of cash outflow projection. 1 Organise for visit to TZ to get data on existing animals
2 Discussed costs and settled on initial funds
3 Funding of initial cost PROPOSAL 1 Purchase of cheap land for average of 10 to 20 acres and holding this for speculation. While holding, this the Company can rare bulls for resale. This will be a merger of short term and long term goals. The target is to obtain land that is valued at between KES 50,000 and 100,000 per acre.
ESTIMATED CASH OUTFLOW AND RETURNS
Koiseta can review being already in the business
Number of animals Time Zero Month 1
Capital Costs Grazing Field Leasing (50 acres @2,500 for 1 years) 375,000.00 - Dam on the leased ground 30,000.00 - Building house for caretaker and Spraying Shed 30,000.00 - Building a cowshed 30,000.00 - Pumps 5,000.00 -
Initial capital 470,000.00 -
Purchases Initial maitenance costs
Proceeds from Sale of Animals - -
Initial purchase of livestock (45 bulls @ 35,000) - 1,575,000.00 Transport of bulls - 20,000.00 Bulls holding area lease and costs - 5,000.00 Care taker salary - 7,500.00 Salt - 1,200.00 Dip (dawa) - 2,000.00 Veterinary Services and medication - 2,000.00 Transport - 2,000.00 Supplemental grass supply - - Miscellaneous - 5,000.00 Total expenses - 1,619,700.00
YEAR 1 CUMMULATIVE CAPITAL OUTLAY (470,000.00) (2,089,700.00)
SUMMARY Year one capital outlay (3,894,400.00) Year two net return on investment 720,000.00 Year three net return on investment 720,000.00 Year four net return on investment 720,000.00 Year five net return on investment 720,000.00 Net return after five years (1,014,400.00)
PROPOSAL This proposal is simple. Target land prices valued at estimate price of KShs 1,000,000 to 2,000,000. This should be in areas speculated to grow within a short period of time to ensure disposal/ development within the next 4 to 6 years.
