Financial Feasibility of Poultry Layer Farms in Chittoor District, India

Abstract

The present study attempts to assess the financial feasibility of layer farms of poultry birds in the Chittoor district of Andhra Pradesh, India. In total, 60 farms were considered for the study, with 20 each for small, medium and large size. A pretested questionnaire was used to collect data from poultry farmers. The Net Present Worth is highest for large farms followed by medium and small farms at both 12 and 16% discount rates, proving the economic viability of farms. The Benefit-Cost Ratio and farm size were positively related and the large farms were economically more viable. The internal rate of return is higher than that of the discount rate for all sizes of farms which implies that investment is feasible. Even though the returns are decreased by 10% (Case I) or costs increased by 10% (Case II), the small, medium and large poultry layer farms are economically feasible at both 12% and 16% discount rates as NPV is positive and BCR is greater than 1. But if the returns are decreased by 10% and Costs increased by 10% (Case III), the small farms become financially infeasible at both discount rates, whereas medium farms become financially infeasible at a 16% discount rate only. The large layer farms are economically feasible at both discount rates if the returns are decreased by 10% and Costs increased by 10% (Case III). Based on NPV, BCR and IRR, large layer farms were most profitable followed by medium and small layer farms. The benefits per bird were highest and cost of production was lowest in case of large farms. The study revealed that poultry layer farming is a profitable business in Chittoor district.