Economic feasibility analysis of commercial horticultural nursery enterprise in Dhemaji district of Assam

Abstract

A nursery is an enterprise where plants are propagated, nurtured, and maintained for sale. They are increasingly recognized as profitable agribusiness ventures due to their low land requirement, short production cycle, and relatively high returns. With increasing diversification towards high-value crops, the demand for quality planting material has risen substantially (Shwetanjali, 2023), making horticultural nurseries an integral component of the horticulture production system. Moreover, private horticultural nurseries, play an important role in rural employment generation and entrepreneurship development (Chu et al., 2010). In this study, a commercial horticultural nursery namely Nandan Kanan nursery located in Dhemaji district of Assam was randomly selected for economic analysis and explore the feasibility of the investment made. Primary information was collected for operational details, investment made, fixed & variable costs, returns from the owner with the help of semi structured questionnaire schedule by personal interview. The nursery was established in the year 2014 with an operational area of 0.94 ha. Different crops grown in the nursery were classified into four broad groups namely fruits, ornamentals, plantations and flower crops. The nursery raised 61 numbers of various plants species and 94 numbers of varieties altogether. Discounted techniques like B:C ratio, NPV, IRR and non-discounted technique namely pay-back period was used to examine the economic viability of the investment made in the enterprise. The findings of the study revealed that, total investment made in the nursery was Rs. 91,41,350.00. In the reference year 2024, the total costs involved in raising the seedlings was Rs. 1,98,20,464.00 of which variable and fixed cost was 97.25 and 2.27 percent, respectively. Total return in the reference year was Rs. 2,18,95,105.00, net profit of Rs. 20,74,641.10 with a B:C ratio of 1.10. The financial feasibility analysis indicated NPV of Rs. 19,02,658.46 at 10 percent discounting rate. The IRR was found to be 16.46 percent and the pay-back period was 3.45 years. These findings clearly reveal that investment in the commercial nursery enterprise in the study area is financially viable and economically profitable.