Annexure-II

CREDIT APPRAISAL FORMAT FOR LIMITS UPTO RS.2 CRORE (FOR MSME UPTO
RS.5 CRORE)
SANCTIONING AUTHORITY
The proposal falls under the powers of Chief Manager(Incumbent Incharge) on account of
CC(H) limit of Rs. 15 lacs
Credit Proposal Tracking System (CPTS) No. / Date:

1274002014000025

17-06-2014

1. Name of the Borrower, BO & Controlling Office :

Date of
proposal

12-06-2014

Whether
fresh/renewal
/
enhancement
/
In-principle
Asset
Classification
as
on
31.03.14

Renewal

Credit
Rating
Bank

Standard

Risk
by

Credit Risk
Rating
Facility
Rating

Rating

Date of
Rating

Score

ABS

Date*

Reasons
for
degradatio
n
**

Validity

Present

PNB-D

14-0314

22.00

31.03.13

30.09.14

Previous

PNB- B

21-0313

43.32

31.03.12

30.09.13

Present

NA

Previous
*12 months from the month of confirmation of rating or 18 months from the date of
balance sheet on the basis of which credit risk rating was assigned, whichever is
earlier.
** Due to TNW ve, under financial 0 score obtained by the company. Due

to this hurdle point applied by rating model and rating downgraded to PNBD
Last
PMS
Score (as on

NA

),
if
applicable
Customer ID
No./Corporat
e Identity No.
(CIN)

D11455453

Activity Code
as
per
LADDER

4001

Whether
sensitive
sector Real
estate/Capita
l
market
alongwith
applicable
risk weight
Whether
priority/non
priority sector
as
per
PS&LB
guidelines
(Sub-sector
may also be
mentioned.)
Date of last
sanction
&
Sanctioning
Authority

NA

Priority Sector

SME- Manufacturing

09-02-2013, CM

GIST OF THE PROPOSAL

Renewal Cash Credit (Book Debt) limit of Rs.15 lacs for one year

1. a)

K D Fashions India Pvt Ltd

b)

Name of the Borrower and

Constitution
Address of Regd. Office with e-mail ID

c)

Works/Factory

Plot No. J-65, M.I.D.C. Industrial Area,

Tarapur, Boisar 401 504. Dist.
Thane, Maharashtra

d)

Date of incorporation/ establishment

07-02-2002

e)

Dealing with PNB since

Feb.2002

210, Dwarkesh Market, 2nd Floor, Mumbai

400 002.
kdfashions@gmail.com

f)

Business Activity (Product)/ Installed

Capacity

Job work for readymade garments

2.

Branch Office/CO

Peddar Road, Mumbai

1) Mr. Ravi Jain (AACPJ5813E)

M-9821078730
2) Mr Dharmchand Jain
(AABPJ9170B)
3) Mr Mukesh Jain
(AABPJ9123C)
B-2, 14th Floor, Tirupati Apt,
Bhulabhai Desai Road, Mumbai,
400026

3.a)

Directors/Partners/Proprietors (Name,
Address, Mobile No., e-mail
ID of main Directors/Key persons) with
PAN No. & DIN(in case of Co.)

b)

Whether any of them, in RBIs Caution

advices/ECGC
Caution
list/Wilful
defaulters' list. If yes, the reasons for
considering the proposal.
If any of them, related to Directors/ Sr.
Officers of PNB

No

d)

Management Change
sanction, if any

Nil

e)

Whether Memorandum of Association

permits the Activity & Powers for
borrowings

f)

Shareholding Pattern

c)

g)

since

last

No

yes

Name
Dharamchand K. Jain
Mukesh D. Jain
Ravi Jain
Yes

(i) Confirmation that CRs have been

compiled/reviewed as per
extant
guidelines (presently L&A Circular No.
33 dated 31.03.2011) and comments
on adverse features, if any
(ii)
Confirmation that CIRs have
Date
been drawn from CICs data
of CIR
base(CIBIL/Equifax/Experian/ High
Mark) and comments on adverse
19-06features, if any:
14
20-0614
20-0614
20-0614

Name
CIC
CIBIL
CIBIL

CIBIL
CIBIL

of

%
shares
held
33.29
33.28
33.28

Adverse
features, if any
observed
Nil (For Company)
Nil ( For
Dharamchand
Jain)
Nil (For Ravi Jain)
Nil (For Mukesh
Jain

(iii) In case of Joint Lending/multiple

banking/
consortium lending arrangement:

NA

Due diligence report on prescribed

from banks approved CA/CS.
If qualified, whether rectified?
Adverse features, if any, are
discussed in the proposal (copy
to be enclosed with the proposal)
Confirmation
that
Sharing
of
Information on prescribed format [L&A
Circular No.31/2012 & 99/2012
(compulsory)] have been obtained
from all lenders and adverse features,
if any, are discussed* in the proposal
(copy to be enclosed with the
proposal)

Details of other lenders:

1.____________
2.______________
3.______________
4.______________

iv) Views/comments* for the adverse

report about the borrower/guarantor, if
any, in the public domain/media:
4. Facilities Recommended:
Nature

(Rs.in lac)
Proposed

Existing

Fund Based
CC(H)/CC (Book Debt)
Inland Bills limit
FOBP/FOUBP/FABC
Others
Fund Based Ceiling

15.00
15.00

15.00
15.00

6.00

0.00

Limit of credit exposure on account of all

derivative products

Exposure Limit for capital adequacy on account

of all derivative products.

21.00

15.00

Non Fund Based

ILC/FLC
ILG/ FLG
Non Fund Based Ceiling
Term Loan

TOTAL COMMITMENT

Details of loans from other Banks/FIs/Consortium/Multiple Banking/JLA as on.

(Rs.in lac)

Name of the Bank

Existing
FB

Share %
NFB

FB

Proposed
NFB

FB

Share %
NFB

FB

NFB

NA

6.A Details of Group Companies/Allied/Associate firms and the facilities sanctioned to

them
Name of the Company

FB

NFB

Name of Dealing Bank

Classification
Account

of

nil

6.B

Comments on conduct of these accounts with our bank/other banks

NA

6.C

Key Financial Figures (Audited) of Group/Allied/Associate concerns (for the last 3

years).
(Rs. in lac)
31.03._____

31.03._____

Paid Up Capital
Reserves & Surplus

Tangible Networth
Block Assets
Secured/Unsecured Loans
Sales
Profit before Tax
Profit After Tax

Comments on Financial Indicators

NA

31.03._____

7.A(i) Financial Position of the borrower

Two
years
earlier
(31.3.11)

One
year
earlier
(31.3.12)

Previous year
(31.3.13)

Latest
data up to
last
quarter of
current
financial
year
Prov.
31.03.14

Estimate
s for the

Audited

Audited

Estimate
d

Gross Sales

187.43

213.00

170.21

209.91

241.74

Other Income

0.12

2.43

0.03

0.07

Profit before tax

-7.89

-6.00

-19.28

-12.98

5.84

Profit after tax

-7.89

-6.00

-19.31

Cash profit/ (Loss)

14.02

7.00

-7.89

-2.75

14.65

Block Assets

222.07

225.30

230.18

Depreciation

115.39

128.40

139.80

Net Assets

106.68

96.90

90.37

80.14

71.31

Secured Loan

12.35

14.72

17.40

11.69

3.67

Unsecured Loan

85.50

88.07

106.24

108.65

99.00

Paid up capital

40.56

40.56

40.56

40.56

40.56

Reserves and Surplus

excluding revaluation
reserves

-26.75

-32.76

-52.08

-65.06

-59.21

Misc. expenditure not

written off

Accumulated losses

Deferred Tax
Liability/Asset

00

Tangible Net Worth

13.80

7.80

-11.52

-24.50

-18.65

Net Working Capital

5.25

-4.11

-101.78

-104.22

-91.12

Current Ratio

1.52

1.00

0.27

0.24

0.24

0.

Audite
d

current
year
(31.3.15)

Operating Profit/Loss

(Rs. in lac)
Projection
s for the
next year
(31.3.__)

Debt Equity Ratio

0.29

0.33

-ve

-ve

Operating Profit/Sales

Loss

Loss

Loss

Loss

Profit

7.A(ii)

Comments on Financial Indicators

Sales declined from Rs. 213.00 lacs (FY11-12) to Rs. 170.21 lacs (FY 12-13). However,
as per provisional figures for FY 13-14 same is Rs. 209.91 lacs and the company estimated
sales of Rs. 241.74 lacs for FY 14-15. TNW became negative as at 31.03.13 due to cumulative
net loss. Also, the company has raised unsecured loans from directors/ related party of Rs.
106.24 lacs as at 31.03.13. Due to this huge amount NWC comes -101.78 lacs as at 31.03.13
and current ratio at below acceptable level i.e 0.27:1. During personal meet with directors, we
advised them to convert part of unsecured loans into paid up capital. This will create positive
TNW, accepatable current ratio and positive NWC.
7.B

Details of investment in Shares, Debentures, Units or diversion of funds outside

the business etc.
Nil

7.C

Details of Liabilities not accounted for/Contingent liabilities

Nil

7.D

Status/details of adverse comments by Auditors of the borrowing unit

Nil

7.E

Position of assessment of income tax/sales tax/wealth tax of the borrowing

concern/ partners/proprietor
Copies of IT return filed for AY 2013-14 held on record for the company and 3
directors/ guarantors Sh. Mukesh Jain, Sh. Ravi Jain and Sh. Dharamchand Jain.

7.F

Overall likely impact of (7.B to 7.E) on the financial position of the borrowing unit
Nil

8.A

Primary Security.

8.B

i)

Working capital facility

ii)

Term Loan facility

Hypothecation of book debts

Since Adjusted

Guarantee/Guarantors
NMs
Previous
Present
36.37
9.18

IPs1
Previous
Present
9.16
0.00

(Rs. In Lacs)
CR Date
Previous
Present
08.02.13
18.06.14

Mr.
Dharamchand
Jain

67.07

27.21

2.31

08.02.13

18.06.14

Mr. Mukesh Jain

59.43

46.20

65.14

08.02.13

18.06.14

Name
Guarantor
Mr. Ravi Jain

of

0.00

65.14

Comments on changes, if any:

Decline in NM of all directors/ guranators is due to exclusion of investment shown in K. D. Fashion I P Ltd
which is having ve TNW.
___________________________
1
Whether charged. If yes, give details

8.C

Total Commitments by Guarantor(s) Rs. 15.00 lacs only

8.D

(i) Collateral Security (Including details of changes in IPs as security from last
sanction, if any)

Security
Area in Ownershi
Description Sq M or p
Sq Ft
Equitable
Mortgaage
of Property
situated plot
No. J-65,
MIDC,
Tarapur,
Bhoisar,
Thane

1800
sq.mtr
s..

K.D.Fashio
n Pvt.Ltd.,

Last
sanction
Rs.127.1
6

Value
Present
book
value
Rs.77.42

(Amt Rs. in lac)

Basis for Dat
e
Realisable valuation
value

Whether
existing/
fresh

Rs. 270.76

Existing

Valuation
report
from
Banks
approval
valuer
M/S Young
India
Engineers
&
Surveyors

06052014

(ii) Status of verification of the IP

Name of the Officer, who visited
the site/IP
Nehal Rasania

9.

Designation
Sr. Manager

PF No.
97126

Date of Visit
17-06-2014

Position of Account as on: 18-06-2014

(Rs. in lac)

Nature

Limit

VS

DP

Balance

CC (BD)

15.00

21.97

15.00

12.30

10.A

Irregularity
reasons
--

alongwith

Conduct of the Account

Availment of limit (FB & NFB), overdrawings,

CC limit utilized fully by the company. The company is regular in repayment of TL and
TL availed from us paid fully on time.
Turnover in the A/c (FB/NFB), Routing of proportionate business in consortium, routing
of sale proceeds, honouring of commitment in non fund based facilities(details of LC/LG
devolved/invoked with amount),
Against sales of Rs. 170.21 lacs in FY 2012-13, credit summations in the account was
Rs. 182.36 lacs. Also against sales of Rs. 209.91 lacs in FY 2013-14, credit summations
in the account was Rs.216.98 lacs. So the company is routing sales proceeds through
our account. TL was fully repaid by the company on time.

 Regularity in submission of CMA data/ financial statement/QMS/Stock Statement.

The company is regular in submission of stock statement and various financial
statements.
The information regarding no. of cheques returned with amount involved due to financial
reasons during the review period should be mentioned.
Nil
The amount/frequency of irregularity in the account during the review period should be
mentioned.
N.A.
10.B

Review of the Account (Appendix C also to be discussed)

Period
F. Y. 2012-13
F. Y. 2013-14

10.C

Cr.
Summation
s
182.36
216.98

Dr.
Summation
s
187.84
213.54

Max
Availment

(Rs. In Lacs)
Min.
Availment.

16.11
14.94

3.20
0.27 cr

Value of the Account

Period

Nature of
Limit

F. Y. 2012-13
F. Y. 2013-14

CC (BD)
CC (BD)

Amou
nt
15.00
15.00

Average
Availment
15.00
15.00

Interest/Commission
Earned
1.80
1.83

(Rs.in lac)
Yield (%)
12.00
12.20

Comments, if any:
10.D

Summary of irregularities pointed out by Banks Inspectors, Concurrent Auditors, Credit

Audit & Review Division (CA&RD), RBI Inspectors, Statutory Auditors, observations of
Stock Audit Report, Comment on Preventive Monitoring Score Trends, (and status of
rectification of these irregularities)
As per Statutory Audit report in LFAR Renewal pending, Balance sheet already
submitted by the party

11.

Brief History (Should also include comments on industry scenario and industry
outlook, management, production and marketing, borrowers' diversification,
expansion, modernisation programme, risk perception including environmental
and social risk alongwith proposed mitigations)
The company is engaged in jobwork contracts for Readymade Garments. The
company is mainly dealing in Gents readymade garment segment i.e. manufacturing of
shirts and trousers. The company is doing jobwork mainly for Siyaram Silk Mills Ltd,
Raymond Apparel Ltd and Future Retail Ltd.

12.

Present Proposal

a)

Brief of the proposal: Renewal of existing CC(BD) limit of Rs. 15.00 lacs

b)

Justification for working capital sanction as per simplified method or traditional

method of lending, as the case may be:

i)

Assessment of Fund Based Limits as per second method of lending:

Rs. in lacs)

Item

Last year actuals

Chargeable current assets

Other current assets
Total current assets
Other current liabilities
Working capital gap
Net Working Capital at 25% of
Total Current Assets less
Export Receivables
Projected net working capital
Permissible bank finance

Current Years
Estimates
20__-20__

Accepted for
assessment Year
20__- 20__

NA

(Reasons for any variation in actual, estimates and accepted level be discussed)

iii)

Assessment of Fund Based Limits as per simplified turnover method

(Rs. In Lacs)
PFB
Estimated Turnover
241.74
Margin 5% of estimated 12.09
turnover
NWC
-91.12
So Margin (B)
12.09
25% of Turnover (A)
60.43
PBF (A) (B)
48.34
The company has estimated sales of Rs. 241.74 lacs for FY 14-15. NWC of the company is ve
mainly due to high level of unsecured loans from related parties. The conduct of the account is
satisfactory and the company has fully repaid TL on due date. So based on the above we can
consider renewal of the existing CC (BD) limit.
c) Justification of non-fund based facilities
i)

Assessment of Non Fund Based Limits

NA

d)

Justification for term loan/DPG

NA

13.

a) Rate of Interest applicable as well as proposed

The company falls under MSME category. As per L&A cir no. 48/2014, for MSME
advances for advances above Rs 50000/- & up to Rs. 20 lacs rate of interest is
BR+2.25% i.e. 12.50% p.a. at present. The same is proposed for existing CC(BD) limit.
b) Risk perception, if any
The company is doing jobwork for only 3-4 major customers. Any adverse affect
to these customers will have considerable effect on the companys job orders. Also, the

company is doing business with big retail customers; the company has limited
negotiation power on margin.
14.

Other Issues NA

15.

Summary of merits/justifications for considering the proposal.

The company is dealing with us since last 10 years. Accounts of the company are
regular with us. The company has repaid various TLs timely in past. Existing limits are fully
secured by collateral security having value of around Rs. 2.70 crores
16. Recommendations:
16.A Deviations in the proposal observed by the recommending authority NIL
16.B

Recommendations:
We recommend for renewal of existing CC (BD) limit of Rs. 15 lacs for one year

SIGNATURE OF APPRAISING AUTHORITY

ORDER OF SANCTIONING AUTHORITY

TERMS AND CONDITIONS FOR PROPOSED WORKING CAPITAL LIMIT OF Rs.15lacs : M/s. K
D Fashions India Pvt Ltd.(Renewal of existing CC limits)

FACIILITY NO.I
Nature

Cash Credit (Hyp of Book debts)

Limit

Rs.15 lacs (Rupees Fifteen lacs only)

Rate of Interest

BR + 2.25 = 12.50 % p.a. at present As per L&A cir no.

48/2014, for MSME advances for advances above Rs 50000/& up to Rs. 20 lacs

Security

Hypothecation of of Book Debt

Margin

: 25 % .

Other conditions
Insurance

: Insurance of collateral security to be done at the

cost of the borrower and policy to remain with
the bank.

Maintenance of Books

Party to maintain the books

of accounts to the satisfaction of the
Bank.

Banks Name Plate

Collateral Security/Guarantee
Security
Area in Ownershi
Description Sq M or p
Sq Ft
Equitable
Mortgaage
of Property
situated plot
No. J-65,
MIDC,
Tarapur,
Bhoisar,
Thane

1800
sq.mtr
s..

K.D.Fashio
n Pvt.Ltd.,

To be displayed prominently where

the machinery/equipments have been installed.
:
Last
sanction
Rs.127.1
6

Value
Present
book
value
Rs.77.42

Realisable
value
Rs. 270.76

(Amt Rs. in lac)

Basis for Dat
Whether
valuation
e
existing/
fresh
Valuation
report
from
Banks
approval
valuer
M/S Young
India
Engineers
&
Surveyors

06052014

Personal Guarantee of Sh. Ravi Jain, Sh. Dharamchand Jain & Sh. Mukesh Jain

Existing

GENERAL TERMS & CONDITIONS

1. The credit facilities shall be collaterally secured by equitable mortgage of I.Ps as
mentioned above and personal guarantee of promoter directors.
2. Company to submit audited Balance Sheet and other financial statements along
with auditors report immediately after completion of audit of the Company.
3.
Borrower to submit the renewal proposal within a period of 10 months from
The date of renewal.
4.
The validity of the sanction of limit shall be 12 Months.
5.
Processing Fee, Inspection charges, commitment charges and other
charges to be recovered from the borrower, as per prescribed norms.
6.
The company shall not undertake any expansion / diversification /
modernization without obtaining prior permission from the Bank.
Also, the monies brought in by the Directors / Promoters shall not be
allowed to be withdrawn without Banks permission.
7.
The Bank or its authorized official and/or outside consultants will
have the right to carry out inspection or examination of the books of
accounts, show room, work shop / service station at any time.
8.
Bank shall have the right to withdraw or modify, add, delete, all / any
of the sanctioned terms and conditions or stipulate fresh condition,
under intimation to the borrower.
9.
The Bank may at its sole discretion disclose any information to any
institution(s) in connection with the credit facilities granted to the
borrower.
10.
Any escalation in the prices of equipment, machinery, furniture and
fixtures is to be borne by the company.
11.
The borrower will keep the bank informed of the happenings at the
even likely to have a substantial effect
in their operations /
production, sales,profits /
disbursements etc., such as defaults / over
dues, labour problems etc., and the remedial steps proposed to be
taken by the borrower.
12.
Margins/ Rate of interest are subject to revision from time to time at
the sole discretion of the Bank.
13.
The Bank shall charge penal interest over & above the agreed rates
under the following circumstances :

Irregularities / overdrawing in cash credit account(s) : 2% monthly on outstanding

balance due to following;
i).Non-submission / delayed submission of stock statements after the
10th of the following month @ the rate 2% monthly on outstanding
balance over and above normal contracted rate.
ii) Non submission / delayed submission of quarterly financial
information/QMS forms as per their periodicity after the closure
of the quarter concerned
iii)Non / Delayed submission of renewal proposal with audited
Balance Sheet, CMA data and statements.
Statements of Assets and Liabilities of the Guarantors after 9 months from the
date of sanction.

Default in observance of borrowing covenants / terms and conditions of the

sanction.
Excess borrowing arising out of short fall in minimum stipulated Net Working
Capital as reckoned in the PBF computation.
Any other eventuality / situation to be decided by the bank.
14.
The borrower should execute necessary loan documents,
as per banks guidelines and as drafted by banks counsels at
borrowers cost.

Loans Officer

Chief Manager