M/s Bhagya & Co. is currently engaged in the manufacture and sale of a product EC. Its budget for the next year reveals the following:

Selling price/unit

: Rs. 15

Variable cost/unit

: Rs. 10

Fixed cost

: Rs. 50,000

Demand

: 25,000 units

It wants to diversity into product OK in order to reduce its market risks, and following are the estimated data for the new product OK.

Selling price/unit

: Rs. 18

Variable cost/unit

: Rs. 12

Fixed cost

: Rs. 30,000

Demand

: 10,000 units.

You are required to suggest whether a diversification is advisable?