PQR Ltd. is considering an R&D project with an initial investment of Rs. 1.5 crores and a project life of 5 years. The project will generate additional revenue of Rs. 50,00,000 per year.

• The variable cost ratio is 40% of revenue, and fixed costs are Rs. 5,00,000 per year.
• The corporate tax rate is 28%, and the company’s discount rate is 10%.

Required:

1. Calculate the Net Present Value (NPV) of the project.
2. Determine the payback period for the project.
3. Compute the Internal Rate of Return (IRR) for the project.
4. Assess the profitability index (PI) for the project.
5. Advise the management on whether to proceed with the project based on the calculated metrics.