dena case study

7/28/2019 Dena Case Study

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DENA BANK, SME CELL, REGIONAL OFFICE, NEW DELHI

PROPOSAL No:-Shree/ADV/10721300100 Date:05/10/2012

Proposal received at

Branch

Proposal received at RO Complete Proposal received at

HO

Date: 04-10-2012 Date : Date

FOR APPROVAL

SANCTIONING AUTHORITY

SENIOR MANAGER

1. GIST OF THE PROPOSAL

Fresh

2. PROFILE

Name of borrower M/s. Unique Engineering

Address

(Regd. Office)

Branch: Shree Nagar, Thane Region: Thane

Established on 2000 Whether appearing in

Dealing with us

since1996 Standard B List No

Group: Willful Defaulter List No


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above) of the Bank. If so give details (Refer to Guidelines)

* CA certificate confirming Net Worth of the Proprietor to be obtained by the Branch before

release of enhanced limit and Branch to ensure that the same is in accordance with Net Worth

as mentioned in the Process Note.

4. Major Shareholders:

S.N Name Status No. of

Share

Percentage

N.A.( Proprietorship Firm)

5. EXPOSURE: [Rs in lacs]

Borrower EXPOSURE Existing Proposed Variation(+/-)

Fund Based 0 15.00 (+)15.00

Non Fund Based 0 0 0

Forward Cover*

Total Credit Exposure 0 15.00 (+)15.00

Investments Nil Nil Nil

Other Commitments Nil Nil Nil

Total Exposure Nil Nil Nil

GROUP EXPOSURE

Fund Based Nil Nil Nil

Non Fund Based Nil Nil Nil

Forward Cover* Nil Nil Nil

Total Credit Exposure Nil Nil Nil

Investments Nil Nil Nil

Other Commitments Nil Nil Nil

Total Exposure 0.00 15.00 +15.00


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I. SECURITY / DOCUMENATION

a) Prime Security (Rs. in lacs)

Nature Value Basis

Hypothecation of Stocks and Book

Debts

9.71 & 18.14 Stock & Book Debts Statement as on

30/09/2012

b) Collateral Security (Rs. in lacs)

Nature of

Security

Type of Charge Value Basis / Source Whether eligibl

under CRM

(Basel II Norms)

Proposed Equitable

Mortgage of

residential property

situated at C 32

Uma Mandakini

Chsl, Nr Model

Town,

Balrajeshwar road,Mulund (West),

Mumbai - 80

65.00

lacs

Valuation Report Yes

i) Percentage coverage of Collateral Security:

1 Total value of Fixed Assets Rs. 65.00 Lacs

2 Of which our share Rs. 65.00 Lacs

3 Total limits proposed from our Bank Rs. 15.00 Lacs

4 Collateral Coverage 127.85%

ii) Reasons in case of dilution of security coverage: N.A.


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c) Date of creation of Charge:

d) Date of subsequent modification of charge:N.A.

e) Date of vetting of documents by legal officer /Panel Advocate:

f) Name of Guarantors & their Net Worth (Rs. in lacs)

Name Relationship Net Worth As of Basis

Smt. Sheena S.

Kurup

Wife of

Proprietor

9.14 Lacs 30.09.2012 As per Annexure

CC

*Net Worth of the guarantors includes their investment in the subject Company and Group

Companies.(Declaration from borrower to be obtained and kept on record, that no

commission or remuneration is paid to them for providing guarantee)

II.CREDIT RATING & Pricing:

Pri cing Existing Proposed

Credit Rating Score Based on ABS [ March 12] AApplicable interest rate as per Credit Rating

Interest rate presently Charged and Proposed

Concession if any

Interest Rate charged by Lead Bank

Commission on NFB Limits

Processing Charges

- Credit Rating Work Sheet furni shed as Annexure 1


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10. COMPANY PROFILE (in brief)

Key Person Mr. Shyam V. Kurup is graduate in Engineering (Marine Engineering) is having 18

years experience in this line of activity. He worked as works design manager in M/s. Precision

Gears then e started his own business in year 2000. Mr. Shyam Kurup has good contracts in

various Pharmaceuticals Companies like Cipla Ltd, Dr. Reddys Laboratories, Glenmark

Generics ltd, Abbott Laboratories etc, who are also his main clients. The competition in this

line is very limited as very few trained engineers who are trained in manufacturing of Blister

pack Machines. These machines are used by pharmaceutical companies for packing of tablet.

Proprietor Mr. Shyam Kurup is banking with us since year 2000 and maintaining current

accounts with an average balance of Rs 2.00 lacs. He is also having overdraft accounts against

term deposits with us but most of times accounts are remaining in credit balance. He is also

having term deposits to tune of Rs. 20.00 lacs with us and also maintaining S.B accounts in his

family members name. Operations in all these accounts are very much satisfactory.

Mr. Shyam Kurup is proprietor of M/s. Unique engineering Co. The firm is engaged in

manufacturing of Blister Pack Machines, De-foiler machines & also undertake changing parts of

any make of Blister, Alu-Alu & Strip pack machines and also after sales service. All these

machines are used in pharmaceutical companies for packing purpose. Firm has reported

satisfactory level of performance as the sales have increased to Rs. 73.62 lacs for year 2012

when compared to Rs 48.01 lacs in FY 2011. The firm has estimated sales turnover of Rs.

121.00 lacs for 31.03.2013 and has achieved a turnover of Rs. 64.80 lacs for the period of 6

months i.e from April to September, 2012 and have sufficient orders on hand in view of which

the estimated level is considered as achievable and accepted. Firm is now expanding the business

and they have purchased adjacent Gala of 520 sq ft in Bharat industrial Estate, L.B.S Marg,

Bhandup where they have decided to install new automatic machines

In view of above, even the projected sales turnover can be considered as achievable and hence

accepted for assessment. The increase in business volume has necessitated the firm in

approaching the bank for working capital which is justified due to above stated factors


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11. INDUSTRY SCENARIO

a. Industry Categorisation Manufacturing and exports of readymade garments.

b. Demand and supply situation

of the product present and

projected (source of

information)

The firm is engaged in manufacturing of machinery of

which is exclusively used in pharmaceutical companies

and the same are key industries there is always demand

for their product

c. Major players & their market

share

There are very few units engaged in this field in view of

the specialised job

d. Banks exposure in this

industry

N.A

e. NPA position as of Sep.

2009

N.A

f. Cyclical trends Nil

g. Govt. Policies Encouraging in view of the proposed expansion of

pharmaceutical industries

h. Whether the product is an

import substitute, if so, what

is the landed cost of import

and what is the production

cost of the indigenous

manufacture

No

i. Availability of raw materials,

labour, infrastructural

advantages

Easily available.

j. What are internal & external

advantages of the

borrower/technology used

The proprietor is well experienced in this line of

business.

k. What are the weaknesses Nil


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l. What are the relative

opportunities

In view of continuous process of latest development in

pharmaceutical industries and competition among them

there is always demand for machinery manufactured by

M/s. Unique engineering

m. What are the threats No threats

n. Any other information Nil

12. PRODUCTION CAPACITY :

Production Capacity Existing Proposed

Installed

Utilised

% Utilisation

13. MARKET CAP : N.A. (not a listed Company)


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14. FINANCIAL INDICATORS : (Rs in lacs)

Audited Audited Estimate Projection

As on 31.03.2011 31.03.2012 31.03.2013 31.03.2014

i. Capital 20.29 27.68 38.28 56.11

ii. Reserves & Surplus

iii. Intangible Assets

Tangible Net worth 20.29 27.68 38.28 56.11

Net Working Capital 7.05 15.28 7.39 30.42

Current Ratio 1.17 1.40 1.13 1.68

Net Block 18.12 17.62 52.41 46.83

Net Sales 48.01 73.62 121.00 181.50

- of which exports

PBDIT 8.80 8.48 18.17 29.14

Gross Profit - PBDT 2.77 4.60 6.51 8.29

Net Profit / LossPAT 7.20 7.45 12.10 19.75

Depreciation 0.71 0.49 3.37 5.85

Cash Accruals

PBDIT/ Gross Sales 18% 11% 15% 16%

Gross Profit Margin 27% 18% 20% 21%

Net Profit Margin 15% 10% 10% 11%

TDER (TOL/TNW) 1.49 1.09 0.87 0.56

Interest Coverage Ratio 9.88 15.70 6.37 7.62

Current Assets to Turnover

Ratio 1.48 3.52 3.10 3.67


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15. Comments on financial indicators, in brief:

I. Positive indicators

1. Sales : The sales of the firm registered a growth around 52% from Rs 48.01 Lacs as on

31.03.2011 to Rs 73.62 Lacs for the year ended 31.03.2012. The firm has estimated sales

turnover of Rs 121.00 lacs for the year ended 31.03.2013 which they are confident to

achieve as they have achieved the sales of 64.80 lacs for the period from April, 2012 to

September, 2012 and also they have orders on hand under execution. Hence targeted

level of sales of Rs. 121.00 lacs for the year 2013 can be considered as achievable

2. Profitability: The net profit of the company has increased from 3.46 lacs as of

31.03.2011 to Rs. 10.11 lacs as of 31.03.2012 which is mainly on the account of increase

of sales from Rs 48.01 lacs to Rs 73.62 Lacs. For the year ending 31.03.2012 the

company has reported net profit of Rs 10.00 lacs as per provisional balance sheet

3. Current Ratio: The current ratio has improved from 1.17 as of 31.03.2011 to 1.40 as of

31.03.2012 but declined 1.13 as of 31.03.2013 due to higher level of other current

liabilities. The actual level for the past years and estimated for the current year is above

minimum requirement level of 1.10 as per policy guidelines of Bank and can be

considered as satisfactory and acceptable.

4. DebtEquity Ratio: Capital of the firm is increasing since last 3years. On account of

retention of profits in business the net worth has increased from Rs 20.29 lacs as of

31.03.2011 to Rs 27.68 lacs as of 31.03.2013 and further to Rs 38.28 lacs for 31.03.2013

and estimated net worth is 56.12 lacs as of 31.03.2012

Debt equity ratio (DER) was 1.49 as of 31.03.2011 improved to 1.09 in the year March,

2012 and further improved to 0.87 for the year 31.03.2013 on account of increased in net

worth 2013. The actual level of DER for the past years and estimated & projected level is

also within the Banks norms and considered as satisfactory.


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5. Interest Coverage Ratio: Interest coverage ratio for past years as well as current year

ending 31.03.2012 is above the minimum requirement level of 1.75 as required by the

banks policy guidelines and can be considered satisfactory

6. Current Asset Turnover Ratio: The mentioned ratio for the past on actual basis and

estimated/projected level of 2.00 as per our loan policy guidelines indicating satisfactory

turnover of current assets

II.Negative indicators, if any, with reasons

III.Auditors remarks and Management replies. Nil as reported by the Branch.

IV.Contingent Liabilities:Nil.

V.Current performance trends: Rs in lakhs

Estimated Net sales turnover for the FY 121.00

Achievement till 64.79

Pro-rata achievement 53%

VI.Comment on current performance trends:

The firm has estimated sales turnover of Rs 121.00 Lacs for the year 31.03.2013 and they

achieved the sales of 64.80 lacs for the period from April, 2012 to September,2012 and they

have sufficient orders on hand under execution. Hence targeted level of sales of Rs 121.00 lacs

for the year 2013 can be considered as achievable.


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VII.INTER-FIRM COMPARISON (PEER GROUP)

(In case aggregate limit exceeds Rs.5000 lakhs)

(Rs in lakhs)

Particulars Our borrower Company A Company B Company C

Sales

N.A.

Net Worth

Net Profit

Borrowing

D/E Ratio

Current

Ratio

16.A. ASSESSMENT OF WORKING CAPITAL REQUIREMENTS : (Rs in lacs)

Audited Estimated Projected

1 Gross Sales 73.62 121.00 181.50

2

Total Working capital requirement

being 25% of the gross

estimated/projected sales 18.40 30.00 45.37

3

Of this bank finance is to extent of 20%

of gross sales 14.72 24.20 36.30

4

Minimum net working capital @ 5% of

gross sales 3.68 5.80 17.87

5 Actual/Projected Net WC 7.05 15.28 30.42

6 Max permissible bank finance 64.78 88.41 110.00

7 Bank Borrowing 14.72 24.20 27.50

8 Shortfall in margin Nil Nil Nil


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B. INVENTORY AND RECEIVABLE LEVELS: (Rs in lakh)

Inventory Audited Projected Estimated

Months Value Months Value Months Value

31.03.09 31.03.10 31.03.11

Raw Materials 0.00 0.00 0.00 0.00 0.00 0.00

Work in Progress 0.00 0.00 0.00 0.00 0.00 0.00

Finished Goods 0.83 19.71 2.18 60.00 2.09 60.00

Receivables

- Domestic 0.00 0.00 0.00 0.00 0.00 0.00

- Export 0.36 8.72 0.65 18.00 0.69 20.00

Stores & Spares 0.00 0.00 0.00

Creditors 1.43 17.89 0.56 9.00 0.67 8.50

D. COMMENTS ON ASSESSMENT OF WORKING CAPITAL WITH

JUSTIFICATION:

The working capital cycle stood at 1.19 months during FY 2008-09 comprising inventory

holding of 0.83 months and receivables at 0.36 months sales. The borrower has now

estimated working capital cycle of 2.83 months during FY 2009-10, comprising inventory

holding of 2.18 months and receivables at 0.65 months.

Nature of business of the borrower is seasonal considering the fact that most of the garment

exports to UK and US for Spring-Summer Season takes place during the period between

November to March.

Receivables :

In Balance Sheet Analysis, receivables have been taken as Rs 8.72 lacs as Rs 102.85 lacs out

of them have been excluded since these bills have been negotiated under FLC and

accordingly FLC outstanding is also excluded from Bank Borrowings. The Firm exports on

L/C-90 days DA/DP basis.


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Receivables have been estimated at 0.65 months (Rs 18.00 lacs) and projected at 0.69 months

(Rs 20.00 lacs), as Rs 50.00 lacs have been excluded from Bank Borrowings towards export

bills negotiated under FL/C. The estimated and projected holding of receivables is considered

need based and reasonable to achieve the estimated/projected sales turnover.

Sundry Creditors:

The creditors for goods during FY 2008-09 stood at 1.43 months purchases (Rs 17.89 lacs)

which is estimated at 0.56 months (Rs 9.00 lacs) during FY 2009 -10. The main reason for

low creditors level during FY 2009-10 is as under :

The Firm has represented that they had received certain goods during the last week of

March09 for their suppliers, which were under checking as on the Audited date (31.03.09)

and hence remained unpaid as on that date. The same was paid during 1st

week of April out

of available PCH limit. The creditors level is projected at 0.67 months (Rs 8.50 lacs) during

FY 2010-11, which is almost in line with the creditors holding level during FY 2009 -10. In

view of the above, the estimated and projected creditors holding period is considered need

based and reasonable.

Based on the accepted level of holding and receivables, the working capital limit works out

to Rs 70.00 lacs under Modified MPBF Method during FY 2009-10 and FY 2010-11.

However, the Drawing Power, as of 31.03.10, based on the accepted holding levels as above,

works out as under:

Particulars Amount (Rs in lacs) Margin Drawing Power

(Rs in lacs)

2009-10 2010-11

10.00%

2009-

10

2010-11

Stocks 60.00 60.00


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Less: Sundry Creditors 9.00 8.50 45.90 46.35

Paid Stock 51.00 51.50

Receivable 18.00 20.00 10.00% 16.20 18.00

Total 62.10 64.35

Say

62.00

Say

65.00

The D.P. works out to Rs 62.00 lacs during FY 2009-10 and Rs 65.00 lacs during FY 2010-

11. Since only around tow and half months is left before the end of the current financial year,

the limits, based on the accepted projections of FY 2010-11 works out to Rs 65.00 lacs.

Accordingly and in line with the Branch recommendation, we recommend for enhancement

in working capital limits by way of PCH-cum-FBP limit from Rs 55.00 lacs to Rs 65.00 lacs.

However, the operative limit would be capped at Rs. 62.00 lacs during FY 2009-10. The full

limits i.e. upto Rs. 65.00 lacs may be released only during FY 2010-11, subject to availability

of D.P.

Renewal of Negotiation of Bills under L/C Limit :

The borrower is presently enjoying Bills Negotiation (under L/C) limit of Rs 50.00 lacs,

outside the overall MPBF, which it has requested for continuation. The borrower utilizes PClimits basically for stocking purpose, which is evident from the month-wise position of

stocks is as under :

Date of Stock Statement Total (Rs in lacs)

31.07.08 26.88

31.08.08 57.22

30.09.08 75.53

31.10.08 93.84

30.11.08 109.12

31.12.08 92.85

31.01.09 102.25

28.02.09 75.60


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31.03.09 19.17

30.04.09 90.67

31.05.09 80.25

30.06.09 65.20

31.07.09 51.78

31.08.09 62.40

30.09.09 63.75

31.10.09 66.44

30.11.09 90.25

In view of the above, the borrower is unable to utilize the FBP limit. The borrower requires

separate Bills Negotiation Limit for negotiation of the Bills under L/C, which is outside

overall MPBF.

The overall record has been satisfactory and no bills have been returned unpaid. Accordingly,

Branch has recommended for renewal of the Bills Negotiation under L/C limit of Rs 50.00

lacs and we endorse the Branch recommendation.

17. ASSESSMENT OF TERM LOAN/ DEFERRED PAYMENT GUARANTEE:

N.A.

18. ASSESSMENT OF NON-FUND BASED LIMITS

A. LETTER OF CREDIT (Rs in lakh)

For purchase of raw materials/stocks

N.A.

Average time taken from date of L/C till the date of shipment (Days)

Average time taken from date of shipment to the date of retirement of

the bill (Days)

(A)

Average rotation of letter of credit in one year (360/A)

(times B)


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Projected Purchase

Level of L/C limit =

{Projected Purchase/Import during the year}/B

Say

Our share

Whether as per Cash Flow statement there will be adequate cash

accruals to retire the bills under L/C on first presentation/due dates.

Names of the Suppliers/beneficiaries in whose favour L/Cs to be

opened

Whether credit reports on the suppliers obtained from

bankers/outside agencies (especially in case of DA L/Cs)

B. BANK GUARANTEE : N.A.

1. Views/comments on the conduct of the account

A. Comments on utilisation of both fund and Non fund based limits

Whether stock statements are submitted every month. If not

submitted regularly mention the date of last stock statement

Yes, 30.11.2009

Whether operations are within sanctioned limits Yes

Whether limits are utilised optimally /satisfactorily Yes

Frequency of inspection of stocks. Date of the last inspection

and irregularity/adverse features, if any observed and steps

taken to set right the same.

30.10.2009, by Sr.

Manager.

No major/adverse

observations.


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Insurance cover - Whether securities adequately insured and

in force

Yes

All Policies are

obtained directly by

the Branch from

Oriental Insurance

Co. Ltd.

Whether terms and conditions of previous sanction have been

complied with, if not, specify time frame to complete (with

explanation) & permission obtained from competent authority

Yes

Whether certificate from Pollution control Board has been

obtained.

Branch has reported

that the Firm falls in

category F of PC

Band hence

certificate is not

applicable.

Whether the borrower is facing any litigation from banks

/FIs/creditors/ Govt. Deptt./ Statutory bodies etc., if so, state

in brief.

None

In case of consortium advance, whether our bank is gettingproportionate share of business

N.A.

Additional / temporary limits sanctioned subsequent to the

last regular sanction and whether same is liquidated on due

date or not

Additional FBNLC

limit of Rs. 100.00

lacs sanctioned by

DGM,NDR on

02.02.2009 and

liquidated on time.

Outstanding amount of unhedged Foreign Currency

Exposures

FC

INR

Rs in Lakhs

Particulars 31.03.2009 31.11.2009


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SalesActual 312.24 184.01

Purchases 150.46 94.14

Credit Summation 247.72 180.13

Debit Summation 258.09 223.02

Minimum Balance 0.01 14.26

Maximum Balance 57.97 57.98

LC Devolved -

Number

Amount

N.A. N.A.

Guarantee Invoked:

Number

Amount

N.A. N.A.

Whether sales and purchase figures match with the

turnover in the account

Satisfactory.

B. Income value of account (Rs. in Lakh)

Last year

08-09

Current year

09-10

Value of account (Deposits)

Process Fee recovered 0.28 0.26

Interest earned 6.67 3.29

Exchange income

Commission earned

Income from Third party products / insuranceOthers (Lead Bank Fee, Commitment fee, Penal

Interest, Syndication fee)

Total

Turnover in Foreign Exchange Business 179.00 219.00


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Deposits placed (Owner Directors/ partners or

Family Members, Relatives & Friends)

- Current 0.40 0.50

- Savings 1.50 1.50

- Term Deposits 20.00 20.00

a. Adverse features affecting credit decision and action proposed (including non-

compliance to terms and conditions of sanction and present position)

Sr

No

Pending Matters Present position Steps taken / Remarks

N.A.

b. MAJOR INSPECTION / AUDIT IRREGULARITIES POINTED OUT IN THE

LAST INSPECTION REPORT

Brief details of irregularities

reported

Compliance Status

1 Internal

Inspectors

Nil as reported by Branch.

2 RBI-AFI

Inspectors

(i)Credit Rating 2008-09 not

on record.

(ii)Audited Balance Sheet 08-

09 not on record.

Credit Rating carried out as

per B/S 31.03.2009.

Audited B/S obtained and

kept on record.

3 Statutory

Auditors

Nil as reported by Branch.

4 Stock Auditors

5 Credit Auditor

c. Directors name figuring in RBI/ Wilful Defaulters / CIBIL / SAL ECGC list and

comments thereon. Impact on taking exposure where names are appearing in the

defaulters list: Nil


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d. Position of statutory dues and incentives receivables

Provident Fund, ESI and Superannuation contribution paid upto N.A.

Wages and salaries paid upto 31.10.2009

Sales Tax paid upto N.A.

Service Tax paid upto N.A.

Income Tax Assessment completed upto and for the year ending # N.A.

Advance Tax paid for the year ending 2010

Excise duty paid upto N.A.

Municipal Tax, Octroi etc. N.A.

Incentives from the Government and other agencies N.A.

Disputes not acknowledged as debts N.A.

Contingent Liabilities (Likely to turn into Liabilities) N.A.

Reconciliation of Debtors/ creditors

*Before release of enhanced limit Branch to obtain C.A. certificate and ensure that the

borrower has paid all its Statutory Dues upto date.

e. Group dealings/experience & desirability of further exposure:N.A.

f. RISK ASSESSMENT

Risk Risk Factor Risk Mitigation

Industry/Activity Risk Fluctuations in the Forex

market.

The Firm hedges by

Forward Contract.

20. COMPLIANCE OF RBI / BANK LOAN POLICY GUIDELINES :

The Proposal is as per RBI/ Banks Loan Policy Guidelines.


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21. MODIFICATION IN EXISTING TERMS OF SANCTION IF ANY:N.A.

22. VIEWS/RECOMMENDATIONS OF THE CREDIT COMMITTEE:

In terms of HO circular No.DCC/GM-Cr/CAD/1249/08 dated 02.06.08, a meeting of the

Credit Committee was held on 07.01.10 at Regional Office, New Delhi.

The Committee cleared the proposal and suggested as under :

i. As per the estimates in CMA data submitted by the Borrower the D.P. stood at the

level of Rs. 62.10 lacs during FY2009-10 and Rs.64.30 thereafter. Accordingly the

operative limit can be capped at Rs. 62.00 lacs during FY 2009-10. The full limits

i.e. upto Rs. 65.00 lacs may be released during FY 2010-11 subject to the availability

of the Drawing Power.

ii. It is also being observed that at the time of last sanction/renewal Capital was

estimated at the level of Rs. 22.50 lacs for FY 2008-09, whereas as per the Audited

B/S of 31.03.2009 Capital stood at the level of Rs. 19.17 lacs.

Therefore it is being stipulated that the Firm has to introduce fresh Capital or

Unsecured Loan of Rs. 3.00 lacs before release of the enhanced limits.

23. DISCRETIONARY POWER FOR SANCTION AND FOR APPROVAL OF

DEVIATION, IF ANY:

The credit proposal falls within the overall discretionary powers of Asst. Gen. Manager-

NDR.


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24. RECOMMENDATION:

It is an Export Credit Account falling under SME sector.

Though the Firm was established in April 2008, however the Proprietor, Sh. Mohit Gupta is

associated with the Bank since 1999 by virtue of being a Partner in M/s xyz Apparels Inc.

Overall conduct of the a/c is Satisfactory, as reported by the Branch. One Time Additional

FBNLC limit of Rs. 100.00 lacs sanctioned by DGM, NDR on 02.02.2009 and liquidated on

time.

The family members of the Proprietor are maintaining substantial deposit in the Branch.(O/s

as on Nov. 2009 Current A/c 0.50 lacs, Saving A/c 1.50 lacs, Term Deposits 20.00 lacs).

Though the borrower has not offered any fresh collateral, however, extension of Equitable

Mortgage over the existing property would result in the coverage of 527.99%, which is

satisfactory.

Overall financial indicators of the borrower are satisfactory as per Banks Policy Norms.

Branch has recommended the proposal, as requested by the borrower.

In view of the foregoing and based on Branch recommendation, we recommend following

subject to the terms and conditions enclosed as per Annexure II

Release of the limits would be as under:

i. The operative limit can be capped at Rs. 62.00 lacs during FY 2009-10. The full limits

i.e. upto Rs. 65.00 lacs may be released during FY 2010-11 subject to the availability of

the Drawing Power.


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ii. It is also being observed that at the time of last sanction/renewal Capital was estimated at

the level of Rs. 22.50 lacs for FY 2008-09, whereas as per the Audited B/S of 31.03.2009

Capital stood at the level of Rs. 19.17 lacs. Therefore it is being stipulated that the Firm

has to introduce fresh Capital or Unsecured Loan of Rs. 3.00 lacs before release of the

enhanced limits.

Put up for approval.

Deepika Kansal J.D. Sinha Devi Singh Chhonkar

Officer (SME) Sr. Manager (SME) Chief Manager-Credit

Annexure 1

FOR EXISTING BORROWERS AND NEW BORROWERS FOR EXISTING

UNITS.

FOR FUND BASED LIMITS ABOVE RS.10.00 LACS

CREDIT RATING REPORT

Branch and Region Okhla

Borrower M/s XYZ Exim

Sanctioning Authority Asst. General Manager

Date of Sanction /

RenewalRenewal-cum-enhancement

Credit Rating as on 26.12.2009

Analysis for Credit

Rating done based on

the Audited /

Unaudited Balance

Sheet and Profit and

Loss A/c of the

borrower for the period

ending

Audited Balance Sheet as of 31.03.09


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Credit facility enjoyed

Nature of ArrangementSanctioned limit

(Rs in lacs)

Outstanding as on

10.01.2010

i.

Fund Based115.00 78.15

ii.

Non Fund Based0.00 0.00

TOTAL ( i + ii ) 115.00 78.15

Marks securedCredit Risk

RatingGrade Interest Slab

95%+ AAA High - Prime BPLR

90% - 94% AAMedium -

PrimeBPLR + 0.25

85% - 89% A Low - Prime BPLR + 0.50

80% - 84% BBB Excellent BPLR + 0.75

75% - 79% BB Best BPLR + 1.00

70% - 74% B Better BPLR + 1.25

65% - 69% C Very Good BPLR + 1.50

60% - 64% D Good BPLR + 1.75

55% - 59% E Satisfactory BPLR + 2.00

Non-Performing

Assets

NPASS Sub-standardInterest to be

calculated at agreed

rates but not to be

charged

NPA - D1 Doubtful - 1



NPA - Loss Loss


26/46

Asst. General Manager

SUMMARY SHEET OF CREDIT RATING MODEL FOR EXISTING

BORROWERS AND NEW BORROWERS FOR EXISTING UNITS FOR FUND

BASED LIMITS ABOVE RS.10.00 LACS

Parameters / Risk factors to be rated

for existing projects /units

Maximum

score

Max.score

Applicable

parameter

Score allotted

1External risk /Gov. Policy Risk/

Environmental risk5 5 3

2 Industry / Business / Sector risk 20 20 11

3 Management Risk 15 15 13

4Security (Collateral) 5 5 5

5Income value to the Bank 5 5 3

6

Past Operating performance vis-a-vis

projections and financial positionrepresented by ratios/trends

40 37 33

7 Conduct of the Account 10 8 8

TOTAL MARKS 100 95 76


27/46

% age of Marks Scored 77.55%

SUMMARY SHEET OF CREDIT RATING MODEL FOR EXISTING

BORROWERS AND NEW BORROWERS FOR EXISTING UNITS FOR FUND

BASED LIMITS ABOVE RS.10.00 LACS

Parameters / Risk factors to be rated

for existing projects /units

Maximum

score

Max.

score

Applicable

parameter

Score

allotted

1External risk /Gov. Policy Risk/

Environmental risk5 5 3

2 Industry / Business / Sector risk

2.1 Intensiveness of Competition 2 2 1

2.2 Presence of substitute etc. 2 2 1

2.3 Barriers to entry for new players 1 1 0

2.4 Business returns 3 3 0

2.5Cyclicality in earnings, subject tovagaries of nature technological

obsolescence

2 2 1

2.6 Technology adopted by Borrower 3 3 2

2.7Dependence on a few suppliers for raw

material1 1 1

2.8Borrowers dependence on a few

customers1 1 1

2.9Foreign exchange component of total

business1 1 1

2.10Whether borrower dealing in perishable

commodity1 1 1

2.11 Demand/supply gap in the business 3 3 2


28/46

Total 20 20 11

3 Management Risk

3.1 Ownership pattern 2 2 0

3.2 Past track record of the Management: -

a. Sales 1 1 1

b. Financial Discipline 1 1 1

c. Furnishing Information 1 1 1

3.3 Quality of the management personnel 1 1 1

3.4 Experience of the Management 2 2 2

3.5 Payment record with banks 2 2 2

3.6 Financial conservatism 1 1 1

3.6 Market standing / credibility 2 2 2

3.7 Support from Group Companies 1 1 1

3.8 Succession risk/plan 1 1 1

Total 15 15 13

4 Security (Collateral) 5 5 5

5 Income value to the Bank 5 5 3

6

Past Operating performance vis-a-vis

projections and financial position

represented by ratios/trends

6.1Achievements of borrowers projections

of sales / gross receipts5 5 5

6.2 Current Ratio 5 5 5

6.3 Trend analysis - variation in Current ratio 1 1 1

6.4 Interest Coverage ratio 5 5 3

6.5 Current Asset to Turnover Ratio 3 3 3

6.6 Debt Equity Ratio 5 5 5

6.7Trend analysis - variation in Debt Equity

ratio2 2 0

6.8 Achievement of Profit Projections 3 3 2


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6.9Profitability to Net worth (Net Profit/Net

worth) i.e. Return on Net Worth2 2 2

6.1 Profitability to sales (Net profit/sales) 2 2 0

6.11

Contingent Liabilities of the Borrower

(Total contingent liabilities to Tangible

net worth)

2 2 2

6.12

Qualifications in Audit Report of the

borrowers Balance Sheet and Profit &

Loss A/c.

1 1 1

6.13 Diversion of funds - No diversion 2 2 2

6.14 Guarantee to Group Companies 1 1 1

6.15 Investment in Group Companies 1 1 1

Total 40 40 33

7 Conduct of the Account

7.1Timely submission of stock and/or Book

debts statement1 1 1

7.2Compliance with terms and conditions of

sanction2 2 2

7.3 Timely renewal/review of the account 2 2 2

7.4Regularity/irregularity of Term Loan

A/c.1 0 0

7.5Regularity / irregularity of the working

capital facilities2 2 2

7.6 Submission of FFR-I & FFR-II 1 0 0

7.7 Conduct of the Group Account, if any 1 1 1

10 8 8

TOTAL MARKS 100 98 76

% age of Marks Scored 77.55%

Annexure II


30/46

Detailed Terms & Conditions

RO/NDR/SME/24/10 12.01.2010

Borrowers Name : M/s XYZ Exim

BRANCH : Okhla

Nature of Arrangement : PCH-cum-FBP

Sanctioned Limit : Rs.65.00 lakhs (Rs. Sixty Five lacs only.)

Margin : 10% for PCH

Rate of Interest : As per Ho guidelines

(Subject to change as per RBI Directives or bank's policy from time to time)

TERMS AND CONDITIONS (For PCH)

Security :

a. Hypothecation of stocks of raw materials, semi-finished goods and finished

goods such as fabric, ready-made garments etc, manufactured by the unit for

export purpose etc.

b. The advance under pre-shipment credit to be covered under Whole Turnover

Packing Credit Guarantee of ECGC granted to the Bank as a whole and monthly

premium to be recovered from the borrower wherever applicable and remitted to the

respective Regional/ Branch Office of ECGC.

2. Other Terms and Conditions

a. Lodgment of original irrevocable Letter of Credit/firm contract with the


31/46

Branch and our rubber stamp to be affixed on it. L/C should not be restricted to

other bank.

b. The goods to be fully insured against fire, theft, burglary, pilferage,

earthquake, flood, SRCC with Bank clause Place of storage is to be mentioned in

the Insurance Policy. Transit Risk Policy to be obtained if goods are to be

transported to a different centre for shipment.

c. Pre-shipment advance to be liquidated within specified period by negotiation/

purchase/discounting of export bills.

d. The borrower shall submit packing credit hypothecation stock statement every

month so that periodical inspection can be carried out by the bank.

e. Where the goods are given for processing "No Lien Letter" to be obtained from

the processors. Insurance policy including transit risk to cover stocks sent to 3rd

party for processing be obtained.

g. Packing credit for shipment to buyers in the countries placed under Restricted

cover by ECGC to be disbursed only with the prior permission from ECGC.

h. Preshipment advance will be treated as Cash Credit advance if the export does

not take place at all. Penal rate to be charged as per RBI/HO circulars issued from

time to time,

i. Packing credit to be allowed for a period not exceeding 180 days or till suchdate shipping documents are tendered in compliance of terms of L/C order,

whichever is earlier. Due date diary to be maintained to monitor timely submission

of documents. Extension beyond 180 days but upto 360 days can be permitted by

concerned General Manager after satisfying about the need for the same. In

exceptional cases extension of shipment beyond 360 days can be permitted after

obtaining approval from ECGC.

j. The advance will be disbursed in phases depending upon cycle of

production/procurement period and delivery schedule. Application to be obtained

from the exporter client stating FOB value of the goods which will be initially

financed. Freight & insurance premium amount would be disbursed at the time of

shipment.

k. Banks name plate stating "GOODS HYPOTHECATED TO DENA BANK,


32/46

OKHLA BRANCH should be prominently displayed where goods are stored.

l. No Packing Credit to be disbursed against the goods received under DA Letter

of Credit.

m. Packing credit advances are to be liquidated only from the proceeds of foreign

bill purchased/discounted/negotiated. Repayment of packing credit advance from

local funds shall attract interest at commercial rate prevailing at the time.

q. In case of failure by the borrower in complying with the terms and conditions

as stipulated above, advance may attract charging of interest at commercial rates.

Standard terms and conditions for Foreign Bills Purchase/ discounted

(DA/DP) (under L/C / confirmed order)

1. Security :

a. Export Bills with a maximum tenor of 180 days drawn on overseas buyers

accompanied by shipping documents like complete set of Bill of Lading /

Consignee copy of Airway Bill, Invoice, Drafts and other documents evidencing

the shipment of goods manufactured by the unit.

b. The party should obtain a comprehensive policy of ECGC (shipment and

contract). Monthly shipment made under the above policy to be declared to ECGC

every month.

2. Other Terms and Conditions

a. Advances to be covered under whole turnover post shipment guarantee of

ECGC taken by the Bank and monthly premium thereon will be paid by the

concerned branch to respective Regional/Branch office of ECGC. [Premium to be

paid by Branch where Exporter is maintaining the account.]

b. In case of Bills drawn under firm contract/order drawing should be allowed to

the extent of credit limit approved for each buyer by ECGC.

c. In case of bills negotiated under letter of credit, all documents as per terms

of L/C must be submitted at the time of negotiation of bills. Export bills should be

drawn strictly in conformity with LC terms.


33/46

d. Branch to ensure that documents tendered are clean. In case of discrepancies

and if the amount received is under reserve, it be held in margin/reserve and may

be released only against the guarantee signed by the firm and the proprietor in his

personal capacity. .

f. ECGC to be informed of the limits sanctioned by the Bank within 30 days of

sanction.

g. Proceeds of the Foreign Bills Purchased/Discounted/negotiated to be credited

to Packing Credit account if any Packing Credit has been disbursed against the

goods exported under such bills.

h. In case export proceeds are not received as per tenor, penal rate of interest as

per HO circular to be charged.

NOTE: while advising the terms of sanction to the borrower please incorporate the

details of penal rates.

Forward Contract LimitRs.200 lac

OTHER GENERAL TERMS AND CONDITIONS

1. The prescribed documents to be executed by the Firm and Proprietor, Sh.

Mohit Gupta, in his personal capacity.

2. The advance to be guaranteed by Shri Mahesh Chand Gupta & Smt. Shashi

Khandelwal and Sh. Vikas Gupta.

3.All the assets charged to the Bank to be fully insured against fire, SRCC, fIood,

breakdown of machinery with bank clause.

4. The unit to submit stock statement every month latest by 15th of the next

month.

5. The advance is restricted to manufacturing activities.

6. Interest rates are subject to revision as per RBI/HO guidelines or as decided by

consortium.

7. Branch to ensure that there are no inter-firm transfer of funds except for

genuine sales transactions.


34/46

8. Bank will have a right to examine all the times Firm's (borrowers) books of ac-

counts, assets etc. and have the Firms workings and operations examined from

time to time by the officers of the Bank or technical experts and/or management

consultants and/or C.A and fees to be borne by the Firm

9. Bank may charge penal rate of interest over and above the rate applicable under

the following circumstances:-

a. delay in submission of stock statement.

b. delay in submission of renewal papers.

10. Guidelines issued by HO/RO from time to time are to be strictly adhered to.

11. The Borrower be informed of the terms and conditions of sanction and the

confirmation be obtained to the effect thereof in writing.

12. Date of reconsideration - One year after sanction.

13. In case of Credit Limit of Rs. 25 lakhs and above there will be mandatory audi t

of annual accounts by Chartered Accounts and the audited accounts of the

borrower should be furnished to the Bank latest by 31st October of each year with

reference to the position as at 31st march of the same year.

14. Process / Upfront Fee @ 0.25% of the sanctioned limit for Working Capital limit

to be charged at applicable rate p.a. plus applicable service tax.

15. Party to pay Supervision Charges @ 0.05% plus Service Tax, subject to maximumof s 50000/- per quarter.

16. There will be mandatory audit of annual accounts by Chartered Accounts and the

audited accounts of the borrower should be furnished to the Bank latest by 31st

October of each year with reference to the position as at 31st

march of the same year.

17. Stock audit may be conducted if bank so desires. The charges for the audit to be

borne by the borrower. Reports will be obtained and examined and necessary action

will be taken as may be decided by the Bank.

18. Plant and Machinery, equipments, furniture and fixtures to be taken as

additional security to cover both the fund based and non-fund based limits.

19. The Borrower to give an undertaking that they are not a defaulter to any Bank /

Financial Institution and has not any relation with any Director of the Bank.


35/46

20. Bank reserves the right to modify /alter terms and conditions of sanction and

cancel the limit at any time without assigning the reason

21. The borrower shall undertake that in case of project cost over-run, it shall arrange

funds from its own sources to meet the shortfall.

22. Date of reconsideration one year after sanction. The borrower to submit the

review/renewal papers 2 months before the due date of sanction/approval.

23. The Borrower be informed of the terms and conditions of sanction and the

confirmation be obtained to the effect thereof in writing.

24. Branch to obtain an undertaking from the borrower that it would maintain its

Capital/ Net Worth as per CMA projections.

25. The documents to be vetted by Advocate on Banks Panel (at the borrowers cost)

to ensure that the documents are as per terms of sanction, valid and enforceable. A

copy of the Vetting Certificate should be kept on Branch record.

26. As per HO circular No.346/42/99 dated 22.11.1999 the following clause should be

incorporated in the sanction letter addressed to the borrower: In case you commit

default in repayment of the CC/Loan/Overdraft facilities/additional interest or any

other dues that may arise out of the loan amount /financial assistance, the bank

reserves the right to disclose or publish the names of the directors of the company as

defaulters, in such a manner and through such media as the Bank/RBI in their absolutediscretion may think fit.

27. As per HO circular No.346/42/99 dated 22.11.1999, 54/1/2004 dt.22/5/2004,

consent letter to be obtained from the borrower for disclosing or publishing their

names in the event of borrower becoming defaulters. The said clause should be

incorporated as last clause of the respective document:

I/We hereby agree as pre-condition of the loan/advance( fund based and non-fund

based ) given to me/us by the Bank that in case I/We commit default in the repayment

of loan/advance or in the repayment of interest thereon or any of the agreed installment

of the loan on due dates the Bank and/or RBI will have an unqualified right to disclose

or publish my/our name or the name of the company/firm/unit and its


36/46

directors/partners/proprietor as defaulter in such manner and through such media as the

bank or RBI in their absolute discretion may think fit.

28. Declaration about no pending court cases (as per H.O. circular no. 351/02/2003) to

be obtained and kept on Branch records.

29. An undertaking to be obtained from the borrower, that the Directors/Guarantors are

not, in any way, connected with any senior official (Scale-IV and above) of the Bank.

30. Commitment Charges: The utilization of limit should be made within 3 to 6

months of date of communication of sanction to the party for working capital. If

average utilization is less than 75% in case of working capital facilities, commitment

charges will be levied @ 0.50% p.a. at quarterly rests on the sanctioned amount.

31. Further an undertaking is to be obtained from the borrower that it will not effect

any change in neither management nor declare/pay dividend nor encumber any of the

securities charged to the Bank, without the express consent of the Bank.

32. Branch to submit certificate of compliance of terms and conditions, as per

prescribed format, to Regional Office.

33. General Undertaking as per H.O. Circular No. 54/1/2004 dated 22.05.04 to be

submitted by the borrower.

34. Branch Official should visit the site/property offered as collateral and cross-check

its Valuation/Title/Marketability etc. through discrete / market enquiries and ensure

that the valuation done by the valuer is justified. Significant divergence observed, if

any, vis--vis Reports submitted by Banks Approved Valuer and Panel Advocate

should be immediately brought to the notice of the sanctioning authority.

35. All legal expenses/other expenses including incidental charges to be incurred

during the course of operation in the account and for completion of documentation

formalities will be borne by the borrower

36. Declaration to the effect that no court cases are pending against the company, its

directors and the group concerns (as per H.O. circular no. 351/02/2003) to be obtained

and kept on Branch record.


37/46

37. Compliance of terms and conditions should be sent to RO in terms of H.O. circular

no.253/41/2002 dated 30.11.2002.

38. The borrower to furnish an undertaking that, where it transpires that the borrower

has given a false declaration, the Bank shall forthwith recall the loan.

39. The Company to submit full details of all the items of Statutory Dues along with

CA Certificate of latest date and Branch to ensure that there are no over dues.

40. Consent clause to be submitted by the borrower & guarantor permitting the Bank

for submission of credit information to Credit Information Bureau (India) Ltd.

41. The Branch to ensure that all the suggestions as suggested by the advocate in Non

Encumbrance Report / Legal Search Report ought to be complied before disbursement.

The Branch Head should personally ensure that if the proposed mortgagor acquired the

title from Government then Non Encumbrance Report / Legal Search Report should be

at least 30 years and if the proposed mortgagor acquired the title from sources other

than the Government then Non Encumbrance Report / Legal Search Report should be

at least 13 years. The Branch also obtains all the documents (chain of documents) in

original which are mentioned in the Non Encumbrance Report / Legal Search Report.

42. If the last documents of the mortgaged property is Lease Deed / Perpetual Lease

Deed then the Branch Manager personally go through the Lease Deed / Perpetual

Lease Deed and before creating mortgage obtain the stipulated permission from the

lessor and if there is any redemption clause (in case of sale of the property the lessor

have the first right in some percentage of the difference between the premium value

and market / sale value) in the Lease Deed / Perpetual Lease Deed, then valuation of

the property should be computed according to redemption clause.


38/46

The said property is also mortgaged to the Bank for Mortgage Loan of Rs. 10.85 Lacs

sanctioned to Sh.. Mahesh C. Gupta, Smt. Shashi Khandelwal, Sh. Vikas Gupta, Sh. Mohit

GuptaO/S as on 10.01.2010 being Rs. 7.95 Lacs and Machinery Term Loan sanctioned to

M/s xyz Apparels Inc-O/S as on 10.01.2010 being Rs. 5.89 Lacs. The conduct of the

aforesaid accounts are satisfactory as reported by the Branch and both the accounts are

classified as Standard.

Nature of

Security

Type of

Charge

Value Basis / Source Whether

eligible

under

CRM

(Basel II

Norms)

Residential

property belonging

to Mr. M.C. Gupta

situated at 15B

Friends Colony

(West), New

Delhi-65,

comprising of 418

sq. yards having

construction on

Ground, First and

Second Floor.

Equitable

Mortgage

680.26** Valuation Report by Banks

Panel Advocate Shri K.C.

Talwar, as on 20.02.08.

As per Legal Opinion-cum-

Non-Encumbrance

Certificate by our

Panel Advocate, Shri Kalim

Ur Rehman dated 08-07-08,

the subject property bears

clear title and is marketable.

No

Total Collateral Security (considering Realisable Value of property) is Rs 680.26 lacs


39/46

SPECIAL CONDITIONS ON CASE TO CASE BASIS

1. Plant and Machinery, equipments, furniture and fixtures to be taken as

additional security to cover both the fund based and non-fund based limits.

2. C.A. certificate confirming Net Worth of the Proprietor and Guarantors to be

obtained by the Branch before release of enhanced limit and Branch to ensure that

the same is in accordance with Net Worth as mentioned in the Process Note.

3. With a view to ease the liquidity position, we propose a stipulation that the

borrower should liquidate the OD facility before release of enhanced limits.

4. The Operative Limit can be capped at Rs. 62.00 lacs during FY 2009-10. The

full limits i.e. upto Rs. 65.00 lacs may be released during FY 2010-11 subject to

the availability of the Drawing Power.

5. It is also being observed that at the time of last sanction/renewal Capital wasestimated at the level of Rs. 22.50 lacs for FY 2008-09, whereas as per the

Audited B/S of 31.03.2009 Capital stood at the level of Rs. 19.17 lacs. Therefore

it is being stipulated that the Firm has to introduce fresh Capital or Unsecured

Loan of Rs.3.00 lacs before release of the enhanced limits.

Deepika Kansal J.D. Sinha Devi Singh Chhokar

Officer (SME) Sr. Manager (SME) Chief Manager

Date: Date: Date:


40/46

Annexure 3

FINANCIAL INDICATORS

(Rs in lacs)

Audited Audited Estimates Projection

As on 31.03.2008 31.03.2009 31.03.2010 31.03.2011

XYZ

Apparels

XYZ Exim XYZ Exim XYZ Exim

A. CURRENT

LIABILITIES

i. Bank Borrowings 46.01 20.27 70.00 70.00

iii. Term Loan

installments duewithin one year. 1.00 0.64 2.70 2.60

iii. Deposits/Unsecured loans

iv. Sundry Creditors 22.36 17.89 9.00 8.50

v. Provision 0.00 0.00 0.00 0.00

vi. Other current liabilities 0.00 2.82 0.40 0.40

Total (A) 69.37 41.62 82.10 81.50

B. TERM LIABILITIES

a) Term Loan 7.51 3.50 10.80 8.20

b) Unsecured Loan 11.99 1.29 2.38 1.06

Other Term Liabilities 0.00 0.00 0.00 0.00


41/46

Total Term Liability 19.50 4.79 13.18 9.26

C. NET WORTH

i. Capital 22.10 15.62 21.17 26.60

ii. Reserves & Surplus 3.55 5.95 7.40

Total (I + ii) 22.10 19.17 27.12 34.00

Total (C) 22.10 19.17 27.12 34.00

Revaluation Reserve 0.00 0.00 0.00 0.00

Net worth Excluding

Revaluation Reserve 22.10 19.17 27.12 34.00

D. TOTAL LIABILITIES 110.97 65.58 122.40 124.76

(A+B+C)

E. CURRENT ASSETS

i. Cash & Bank Balance 3.01 19.34 17.30 17.40

ii. ReceivablesDomestic

- Export 17.60 8.72 18.00 20.00

iii. Inventory 53.41 19.71 60.00 60.00

iv. Loans & Advances 3.71 1.58 0.00 0.00

v. Other current asset 11.43 9.38 6.60 8.00

Total (E) 89.16 58.73 101.90 105.40

F. NET FIXED ASSETS

(Excluding Revaluation

Reserve)

18.16

5.85 19.50 18.36

G. ADVANCES/

INVESTMENT IN

SUBSIDIARY/

ASSOCIATE CONCERNS

0.00

0.00 0.00 0.00


42/46

H. OTHER NON

CURRENT ASSETS

3.65

1.00 1.00 1.00

I. TOTAL ASSETS

(E+F+G+H+I)

110.97

65.58 122.40 124.76

J. FINANCIAL

PERFORMANCE

i. Gross Sales Domestic 0.00 0.00 0.00

Export 262.11 287.61 330.00 350.00

Duty Drawback 26.17 24.63 30.00 31.50

Less: Excise Duty 0.00 0.00 0.00 0.00

Net Sales 288.28 312.24 360.00 381.50

Growth (%) 8.31% 15.30% 5.97%

ii. Gross Profit 6.49 4.65 8.31 10.64

iii. Depreciation 3.37 1.10 2.36 3.24

iv. Taxation 0.00 0.00 0.00 0.00

v. Net Profit 3.12 3.55 5.95 7.40

vi. Dividend 0.00 0.00 0.00 0.00- Amount

- Percentage

vii. Profit retained in

business 3.12 3.55 5.95 7.40

ix. Interest 13.86 7.11 9.00 9.50

x. PBDIT 20.35 11.76 17.31 20.14

K. RATIO ANALYSIS

i. Current Ratio 1.29 1.41 1.24 1.29

ii. Total Debt/Equity 3.14 2.17 3.03 2.40

iii. Gross Profit/Sales 2.25% 1.49% 2.31% 2.79%


43/46

iv. Net Profit/Sales 1.08% 1.14% 1.65% 1.94%

v. Debtors/Sales 0.73 0.34 0.60 0.63

vi. Creditors/Purchase 2.36 1.43 0.56 0.67

vii. Interest Coverage

Ratio 1.47 1.65 1.92 2.12

viii. Current Assets to

Turnover Ratio 5.40 15.84 6.00 6.36

Annexure 4

DETAIL S OF CONSORTIUM / MULTIPLE BANKING ARRANGEMENTS

(Rs. in lakh)

Particulars % Share EXISTING PROPOSED

FB NFB FB NFB

Our Bank

NilOther Member Banks

Total

(Details as per Annexure)

Annexure 5

Limits enjoyed by Associate / Group concerns: (Rs. In lakh)

A. With our bank

Name Branch Details of limits Last sanction Ass


44/46

FBWC

TL as

of

10.01.10

NFB Date Authority

et

Cla

ssi-

fica

tion

Mortgage Loan

of Rs. 10.85 lacs

sanctioned in

Sep.05 to Sh.

Mahesh C

Gupta,(Borrower)

Smt. Shashi

Khandelwal, Sh.

Vikas Gupta, Sh.

Mohit Gupta (Co

Borrowers)

Okhla 7.95 11.07.08 DRM

(NDR)

Stan

dard

Machinery Term

Loan Sanctioned

to M/s xyzApparels Inc

Okhla 5.89 11.07.08 DRM

(NDR)

Stan

dard

(Rs. In lakh)

B. With other bank/FIs/others

NameBank/FIs

/Others

Details of limits Outstanding Asset

Classi-

ficationFBWC TL NFB FBWC TL NFB

Nil

Annexure 6


45/46

Profile of the group concerns with brief financial indicators

The Firm is having a sister concern under the name and style of M/s xyz Apparels.

A machinery Term Loan is still operational having current O/s as of 10.01.2010 being Rs.

5.89. The Account is classified as Standard.

Gist of Financial Indicators of M/s Central Agencies

(Rs. In lacs.)

S.No. Particulars As per

Audited B/S

of 31.03.2009

1. Net Sales 144.19

2. Gross Profit 6.41

3. Net Profit 0.93

4. Capital 5.34

5. Net Worth 5.34

6. Net Fixed Assets 15.43

Annexure 7

Details of properties/assets etc. Under collateral security viz. Valuer, valuation date,

encumbrance & marketability status etc.

Nature of

Security

Type of

Charge

Value Basis / Source Whether eligible

under CRM

(Basel II Norms)

Residential

property

belonging to Mr.

M.C. Gupta

Equitable

Mortgage

680.26** Valuation Report by Banks

Panel Advocate Shri K.C.

Talwar, as on 20.02.08.

As per Legal Opinion-cum-

No


46/46

situated at 15B

Friends Colony

(West), New

Delhi-65,

comprising of

418 sq. yards

having

construction on

Ground, First

and Second

Floor.

Non-Encumbrance

Certificate by our

Panel Advocate, Shri Kalim

Ur Rehman dated 08-07-08,

the subject property

bears clear title and is

marketable.

Total Collateral Security (considering Realisable Value of property) is Rs 680.26 lacs

The said property is also mortgaged to the Bank for Mortgage Loan of Rs. 10.85 Lacs sanctioned t

Sh.. Mahesh C. Gupta, Smt. Shashi Khandelwal, Sh. Vikas Gupta, Sh. Mohit Gupta O/S as o

10.01.2010 being Rs. 7.95 Lacs and Machinery Term Loan sanctioned to M/s xyz Apparels Inc-O/

as on 10.01.2010 being Rs. 5.89 Lacs. The conduct of the aforesaid accounts are satisfactory a

reported by the Branch and both the accounts are classified as Standard.

Annexure 8

Additional comments, if any along with investments details in associate /sister concerns,

comments on balance sheet, auditors remarks etc. Nil ______________________

dena case study

Documents