THE

FEDERAL BANK SME & Agri Business Dept

LIMITED Regd. Office: Aluva, Kerala.

SMEABD/S -27 / L / /10 Date:

1 Date on which the proposal/request was received from the Branch

2 Date on which queries were raised to RO/Branch
3 Date of receipt of reply (Final)
4 Date of receipt of RO recommendation
5 Date of placing the appraisal note

SUBMITTED TO GENERAL MANAGER (CREDIT)

PROPOSAL FOR CREDIT FACILITIES (ADDITIONAL LIMIT)

Branch: Rating : Previous rating Region:

1. SECTOR/GROUP DETAILS OF BORROWER

(Amount in Rs. In lakhs)
1.1 Applicant/Borrower 1.1.1 Group: --
1.1.2 Group exposure:--
1.1.3 Sector/Subsector: Code:
1.1.4 Sector exposure (including the
above)
1.1.5 Exposure limit
1.1.6 Exposure as % of net worth:

Present proposal in brief:

2 BORROWER PROFILE:

2.1.1 Name
2.1.2 Address – Factory
Office.
2.1.3 Constitution
2.1.4 Business / Activity
2.1.5 Category/sector)
2.1.6 Priority/ Non priority
2.1.7 Date of incorporation
2.1.8 Advances since Current a/c since:
2.1.9 Credit rating and pricing
Present Proposed
a.Internal
b.Pricing as per rating
External
2.1.8 Asset classification
2.1.10 Banking arrangement

a. Sole
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b.. Consortium Leader & Our Other

Share share (%) Bank’s
(%) share
(%)
c. Multiple Main Our Other
Banking Banker & share (%) Bank’s
Share share
(%) (%)
2.2 Management
2.2.1 Name of the promoters
2.2.2 Share holding pattern
Major shareholders % of shareholding
i
ii
iii
2.2.3 Whether listed
2.2.4 Stock market data (if listed)
i)Year low/high price Rs.
Present/recent market quotation Rs.
Book-value of shares Rs.
2.2.5 Name of proprietor/Partners/Directors/Trustees
Name Passp Age Other directorships. Share
ort Mention if Nominee holding
No. Director

Chairman
CEO

2.2.6 Comments on the quality and competence of

CEO.
2.2.7 Track record of the management
2.2.8 Details of pending litigation against the borrower /
directors / promoters, if any.
2.2.9 Relationship of the borrower, if any with the
Directors and employees of the Bank/Directors of
other Bank.
2.2.10 Any interest of Directors of the Bank in the
borrower
2.2.11 Any interest of Directors of the other Banks in the
borrower.

3 CURRENT PROPOSAL:

3.1 Existing /proposed credit facilities from the bank

3.1.1 Facilities
Existing Limits Proposed Limits Existing Proposed
Nature Amoun Bala Over- Inc. Total Int/Co Period Int/Co Period
t nce dues/A (+) / includi mmn mmn
rrears Dec. ng the
(-) in existin
limits g
 3

FUNDED

TOTAL
NON FUNDED

TOTAL
GT
#Note: Qualify whether New, Renewal with enhancement, Renewal, Adhoc only etc.
Date of last sanction: Authority: Date of disb.: Date of latest review

3.1.2.Brief on the existing facilities

3. 2.2 Pricing analysis

Existing Proposed
Funded Rate of Pricing as Rate of Pricing as Remarks
Interest per rating Interest per rating
Term Loan
Working capital
Non funded
LC
Standby LC
BG
Processing fee
Front end fee
Commitment fee
Prepayment
charges
Any other fee
including fee from
third party products

3.2.3 Securities
Description Value as on ……
Present Proposed
Primary

Collateral

Additional

Others

Residual value to be furnished in respect of securities charged to any other facility

3.2.4. Comments on security/ Security Analysis/ Asset Coverage Ratio

Requirement of collateral security as per margin norms

Nature of limit Margin to be Limit/ Collateral
maintained % Bal. required
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3.2.5. Guarantees/ co obligancy available or offered:

(1) (2) (3) (4)
a. Name of guarantor/ co obligants
b. Constitution
c. Net worth/Means as on…………
d. Basis of assessing net worth
Furnish whether Certificate of Branch Manager as to verification of the facts ascertaining networth
available.

3.3. Conduct / value of the account

3.3.1. Unit visit/stock inspection report and findings there of.

3.3.2. Conduct of the account (Comments)
(Rs in lakhs)
3.3.2. Utilisation of: Previous year Current year
Amount % Amount %
a. Funded facilities (Average Debit
Balance)
b. Non-funded facilities
c. Cr. Summation in operative accounts xxxx xxxx
d. Dr. summation in operative accounts xxxx xxxx
e. Highest debit balance Xxxx Xxxx
f. Lowest debit balance xxxx xxxx
e. PCLs disbursed xxxx xxxx
g. Bills purchased / discounted xxxx xxxx
h. LCs opened
i. Guarantees issued

3.3.3. Earnings: Previous year Current year

a. Interest
b. Other income (including third party
products)
c. Total
d. Yield on exposure (%)
3.3.4 Ancillary business / business through connections of the borrower:
No. & average No. & av bal. of Amount of fixed No. & amount of life and non
bal. of last 6 last 6 mths of CD deposit life insurance policies sold
mths of SB a/c a/c

Gold coins No. & amount of Any other ancillary benefits obtained
sold in grams third party products
sold.

3.4. Outstanding inspection irregularities as on :

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i. RBI

ii. Statutory

iii. RBIA

Iv. Concurrent

v. Credit Audit

4 CREDIT FACILITIES FROM BANKS / INSTITUTIONS: (including our Bank)

4. 1. Term Loans:

4.1.2 Existing
(Rs in lakhs)
Lender Amount Interes Period Balance Over- Security
t dues

Total

4.1.3 Proposed
(Rs in lakhs)
Lender Amount Interest Period Security
Proposed

Total

4. 2. Working capital :

a. Whether consortium
b. Name of leader bank, branch/ office
c. Credit facilities enjoyed
No Lender Existing Proposed Sharing pattern (%)
Natur (Rs in lakhs) Existing Proposed
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Fun Non- Fun Non- Fund Non- Fun Non-

ded funde ded funde ed funde ded funded
d d d

TOTAL

4. 3 Total credit limits enjoyed from all a. Funded Rs……….

banks/institutions b. Non-funded Rs……….

5 INDUSTRY SCENARIO (Not more than 2 pages. The write up may contain the market
size, market share of major players, demand, supply, profitability, competition, governmental
policies, prospects etc).

6 BUSINESS ENVIRONMENT (Not more than 2 pages)

Business description
Operating strategy
Borrower competitive position
Management

6. 1. Physical performance:

a. Production:
Year I Year II Year III
Qty Value Qty Value Qty Value
Products
Installed capacity
Capacity utilisation
b. Sales :

7 FINANCIAL PERFORMANCE – PAST AND PROSPECTIVE

7.1 Balance sheet (Two year audited, current year estimates and following year
projections)
Year / period ending
Audited Audited Estimates Projections
Liabilities 1 2 3
Net worth
Equity
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Surplus in profit and loss account

Less Intangible assets /
revaluation reserves etc.
Sub-total
Term liabilities
Term loans
Deferred tax – liability
Unsecured loans
Sub-total
Current liabilities
Short term bank borrowings
Sundry creditors
Instalments of term loans
repayable in 12 months
Provisions
Other current liabilities
Sub-total
Grand total

Year / period ending

Audited Audited Estimates Projections

Assets
Fixed assets
Gross block
Depreciation
Net block
Other non-current assets
Investments in - associates
- Others
Loans and advances - Associates
- Others
Sub-total
Current assets
Cash and bank
Fixed deposits with Banks
Receivables
Inventories
Other current assets
Sub- total
Grand total

7.2 Financial indicators and key ratios (Two year audited, current year estimates
and following year projections. Please refer Annexure II and III for detailed profit
and loss account and balance sheet)
As at / For year to
31 March Audite Estimates
Audited Budget Projections
d
Total operating income
(TOI)/ sales
PBIDT
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Interest
Depreciation
Operating profit
Non- op. Income
Profit before tax (PBT)
Profit after tax (PAT)
Cash accruals
Dividend
Paid-up capital (Equity)
Tangible net worth (TNW)
Exposure in subsidiaries /
group companies
* Investments
* Loans & Advances
Adjusted TNW (ATNW)
Net working capital
Growth in sales (%)
Growth in PAT (%)
PBIDT/Sales (%)
PAT/Sales (%)
Debt/TNW (Times)

As at / For year to
31 March Audite Audite Estimates
Budget Projections
d d
Debt/ATNW
Total liabilities / TNW
(Times)
Total liabilities / ATNW
(Times)
Total debt / Net cash
accruals
Current ratio (Times)
ROCE (%)
Interest cover (Times)

7. 3. Comments on Financial Position:

7.3.1 Turnover :

7.3.2 Profitability :

7.3.3 Liquidity :

7.3.4 Leverages (DER and TOL/TNW) :

7.3.5 Non-current Assets :

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7.3.6 Contingent liabilities :

7.3.7 Debt-Servicing Capacity :

7. 4. Related party transactions

As at / for years ended

7. 5. Performance in the current year (Previous four quarters)

For the quarters ended I II III IV

(Date) (Date) (Date) (Date)
Total operating income
(TOI)
PBIDT
PBT
PAT
PBIDT/Net sales%
PAT/Sales %
Net cash accruals

7. 6. Borrower's auditors, their significant comments on the recent financial

Statements:

7. 7. Statutory Dues (IT, WT,ST, Excise Duty, PF, ESI, Others)

8. DETERMINATION OF THE LIMITS:

8. 1. Term loans: (Brief description of the project)

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8.1.1. Cost of the project and means of finance

Description Rs. in lakhs
Land and site development
Buildings and other civil works
Plant and machinery
Utilities
Misc. fixed assets
Preliminary expenses
Pre-operative expenses
Contingencies
Margin on working capital
Total
Means of finance
Term loan
Promoters’ contribution – Equity
-Preference shares
Subordinate debt
Total

8. 1. 2. Land and site development (Brief discussions about the land, cost etc.)

8. 1. 3. Buildings and other civil works (Brief discussion about the civil works,
description of the building, comparison of the cost , contractors etc)

8. 1. 4. Plant & Machinery (Brief discussion about each item of machinery, suppliers,
comparison of the cost , plant lay out, capacity etc)

8. 1. 5. Utilities (Brief discussion)

8. 1. 6 . Misc. fixed assets (Brief discussion)

8. 1. 7. Preliminary and preoperative expenses: (Brief discussion, including about

interest during the implementation period)

8. 1. 8. Margin on working capital. (Basis for arriving at the gross working capital and the
margin)

8.1. 9 Contractual structures: (Provide salient features of the EPC contracts, O&M
contracts, Purchase and supply agreements etc).

8. 1. 10 Marketing arrangement: (Detailed discussions)

8. 1. 11 Financial tie up (Detailed discussions)

8. 1. 12. Implementation Schedule & Status of work.
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Description Time schedule Present status

8. 3. Basis of fixing term loan

Cost Margin Loan Asset cover
componen
Particulars t
Land and site development
Building
Plant & Machinery and other fixed
assets
Total

8. 4. Summary of the projected profitability and cash flow statements

1 2 3 4 5 6

Years
Capacity utilisation
Sales/Revenue
PBIDT
PBIDT margin
Depreciation
Interest
PBT
Prov for taxes
Net profit

Cash in flow
Repayment obligations
Interest
Repayment of TL
Total
DSCR
Average DSCR

( Please refer to Annexure IV, V and VI for detailed projected profitability statement, cash
flow statement and balance sheet )

8. 4. 1. Assumptions on projected profitability estimates

8. 4. 2. Sensitivity analysis:

8. 4. 3 Repayment schedule:

9. WORKING CAPITAL (Brief description on the working capital requirements of the

borrower)

9. 1. Assessment of limits
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9. 1. 1 Inventory, Receivables and Credit levels :

Assets/Liabilitie Audited Estimated Projected

s (Date) (Date) (Date)
Months Amount Months Amount Months Amount
Raw material
-Indigeno
us
Imported
Stock in process
Finished goods
Receivables
-Domestic
Exports

Consumables
-Imported
Indigenous
Other Current
Assets
Total Current
Assets

Trade Creditors
Other current
liabilities (give
details)
Total Current
Liabilities

9. 1. 2. Comments on Assets/Liabilities levels

Raw materials

Stock in Process

Consumables

Finished goods

Receivables

Other Current Assets

Sundry Creditors

Other Current liabilities

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9. 1. 3. Computation of assessed bank finance (ABF) – Funded limits

Date Date Date

Year ended/ending
Audited Estimates Projections
1 Sales (Net)
2 Total Current Assets (CA)
3 Current liabilities (other than bank
borrowings)
4 Working Capital Gap (WCG)
5 Net Working capital (NWC)
6 ABF (WCG minus 25% of CA or actual
NWC whichever is higher)

9. 2 Limits recommended:

Existing Recommended

9. 3. Non-funded limits:
9. 3. 1. Letter of Credit: (Detailed discussions covering the types of imports/
purchases, main terms of payments, usance period, lead time, main suppliers, past
experience with such suppliers and borrower's timely reimbursement of the Bank
etc.)

9. 3. 2. Assessment of LC facility
(Rs in lakhs)
Existing (FY 05) Proposed (FY 06)
FLC ILC FLC ILC
a. Procurement of material
b. Monthly consumption
c. Purchases / import under LC (%)
d. LC based purchases per month
e. Usance period
f. Lead period
g. Total of (e) + (f)
h. Amount of LC required (d*g)

9. 3. 3. Bank Guarantee: (Detailed discussions on BG limit covering the past experience,

including any guarantees invoked and recovery from the borrower, total
outstanding bank guarantees, guarantees expiring within the current year,
maximum/average tenor of bank guarantee, purpose of guarantees to be
issued, main terms and how the borrower can be expected to fulfill the
guaranteed obligations satisfactorily, especially if the guarantees are bid bonds,
advance payment guarantees or performance guarantees.)

9. 3. 4. Assessment of the BG facility

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Opening balance in the Basis Amount

guarantee limit
Earnest money deposits - % of the tenders in which the
borrower expect to participate in
the financial year.
Security deposits required to be - % of the tenders expected to be
maintained awarded in the financial year.
Advance payment guarantee - % of the tenders expected to be
awarded in the financial year.
Retention money - % of the works to be competed in
the financial year.
Others
Total
Less guarantees expected to be Based on the due dates of existing
cancelled/matured in the guarantees and past experience/
financial year. trade practices.
Limit required

10. COMPLIANCE AND EXCEPTIONS

A Exposure is within Bank’s prudential norms / RBI guidelines
B Borrower / directors/ key persons are not under RBI
defaulters
C Borrower / directors/ key persons are not under SAL of ECGC
C Deviations if any from the Loan policy guidelines
10.1 Exceptions noticed if any in respect of :
10.1 a. Management and business of the borrower.

10.1 b. Financials of the borrower

10.1 c. Conduct of account

10.1 d. Internal polices and guidelines

10.1 e. Statutory and Regulatory provisions

10.1 f. Any others

11. GROUP EXPOSURE

11. 1. Details of associate concerns : (Please provide brief details and provide
detailed financial analysis in annxure VIII)

11. 2. Bank’s exposure to the group:

Company / firm Funded NF facility Security Whether

facility restructured

Total
Total exposure to the group Rs.
Irregularities, if any:
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12 RISK ASSESSMENT (Refer to Annexure VII for detailed Risk Analysis)

12. 1 . Overall Risk Rating -

12. 2. Justification for deviation in interest rate and other concessions:

12. 3. Key risk areas and mitigating factor

Key Risk areas Mitigating factors

12.STRENGTH AND WEAKNESS OF THE PROPOSAL

13.RATIONALE OF THE PROPOSAL

14. RECOMMENDATION

14.1 Business based

14.2 Financial conditions based.

14.3 Credit relationship strategy based

14.4 Risk and mitigants based

We hereby confirm that CIR from CIBIL in respect of borrowers/ partners/ directors/ co-
obligants/ guarantors have been obtained and that the report contains no adverse features.

“Other existing facilities, as discussed in para 3.1.2 of the proposal, are reviewed and
allowed to be continued.”

Confirmation regarding collection of 50% of the normal processing fee:

Delegation :
16
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ANNEXURE - I

Terms and conditions of the facilities:

Borrower :

Branch / R.O :

Nature of limit I II III

Amount in Figures
Amount in words
Int./Comm./Disc.
Interest reset
Period
Repayment holiday
Repayment
Processing fee
UP front fee
Prepayment penalty
Penal interest / liquidated
damages
Commitment charges
Margin
Guarantee cover
Refinance
Total liability
Total liability of Group
SECURITY
Primary
Collateral
Additional
Co-Obligants/ Guarantors

OHER MAIN TERMS & CONDITIONS

Pre- Disbursement conditions

Post- Disbursement Conditions

 18

Annexure II

Name of the borrower

Operating statement

Year ended / ending Date Date Date Date

Audited Audited Estimated Projected
1 2 3 4

Net sales – Domestic

- Export
Total sales
Other operational income
Total operational revenue
Increase in sales (%)

COST OF SALES
Raw materials - Imported
- Indigenous
Manufacturing / trading expenses
Depreciation
Sub - total
Add / less differential in stock in
process

Cost of production
Add / less differential in stock of FG

Cost of sales
Selling and admn. Expenses
Sub-total
OPERATING PROFIT BEFORE
INTEREST
Interest
OPERATING PROFIT AFTER
INTEREST
Non – operative income (net)
PROFIT BEFORE TAX
Provision for taxes
PROFIT AFTER TAX
Dividend
Retained profit
Retained profit - %
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ANNEXURE III

Name of the borrower

Analysis of balance sheet

Year ended / ending Date Date Date 2007

LIABILITIES Audited Audited Estimated Projected
1 2 3 4
CURRENT LIABILITIES
Short-term borrowings from banks
Sub – total (A)

Sundry creditors
Installments of term loans payable in
12 months.
Provision for taxes
Other current liabilities
Sub-total (B)
Total current liabilities (A+B)

Term loans
Unsecured loans
Deferred taxes
Total term liabilities
Total outside liabilities
NET WORTH
Equity
General reserves
Surplus in profit and loss account
Net worth

TOTAL LIABILITIES
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ANNEXURE III (a)

Name of the borrower

Analysis of balance sheet

Year ended / ending Date Date Date Date

ASSETS Audited Audited Estimated Projected
1 2 3 4
CURRENT ASSETS
Cash and bank
Fixed deposits with Banks
Receivables - Domestic
- Export
Inventories: RM
Stock in process
Finished goods
Advances to suppliers
Other current assets
Total current assets

FIXED ASSETS
Gross block
Depreciation
Net block

OTHER NON CURRENT ASSETS

Investments
Total other non current assets

TOTAL ASSETS
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ANNEXURE IV

Profitability projections.

(Rs in lakhs)
Years 1 2 3 4 5
Sales
Other Income
Total income

Cost
Raw materials
Other direct costs
Selling & Admn cost
Depreciation
Interest – TL
Interest – Working capital
Interest – others
Total cost
PBT
Taxes
PAT
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ANNEXURE V

Projected balance sheet.

(Rs in lakhs)
Years Date Date Date Date Date
Liabilities
Capital
Reserves and surplus
Deferred taxes
Subordinate debts
Term loans / term liabilities
Short term bank borrowings
Other current liabilities
Total
Assets
Fixed assets
Investments
Export receivables
Domestic receivables
Inventory
Other current assets
Cash and Bank
Misc. Expenses
Total

ANNEXURE VI
Projected cash flow statements.

(Rs in lakhs)
Years 1 2 3 4 5
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A. Sources
Profit before taxes
Depreciation
Increase in term liabilities
Increase in deferred taxes
Increase in subordinate debt
Increase in short term
borrow
Increase in other CL
Decrease in misc. expenses
Total
B. Disposition of cash
Increase in fixed assets
Increase in other current
assets
Decrease in term liabilities
Increase in misc. exp
Taxes
Total
Surplus / deficit
Opening balance
Closing cash balance

ANNEXURE - VII

CREDIT RISK ASSESSMENT FORMAT

(As stipulated for specified loan amount (Rs.2L to Rs.50L or Rs.50L to Rs.500L or
Rs.500L and above as the case may be)
 24

Annexure VIII
 25

DETAILS OF THE ASSOCIATE CONCERNS. (Please provide the following details in

respect of each associate concerns).

I Name of the concern.

a. Background in brief:

b. Directors / Partners / Trustees etc.

Name Other directorships

c. Financial performance : (Last three years audited figures)

(Rs lakhs)
Date Date Date
Year / period ended Audited Audited Audited
Net sales
PBIDT
Interest
Depreciation
PBT
Profit after tax (PAT)
Net worth
Long-term debt
Current liabilities
Fixed assets
Current assets
Long-term investments
Net working capital
Total assets = liabilities
Debt/equity ratio (Times)
TOL / TNW
Current ratio

Related party transactions (past two years)

(Rs in lakhs)
As at / for year

c.Credit facilities from our Bank:

 26

Status of the accounts: Standard

(Rs. in lakhs)
No Nature Amount Balance as on Overdues/a Disbursed on
20/7/04 rrears
FUNDED
1
2
3
4
TOTAL
NON FUNDED
1
TOTAL
GRAND TOTAL

Securities:

Primary

Collateral

Others

Guarantors

d.Credit facilities from other Banks / FIs:

Bank / FI Amount Interes Period Balance Over- Security

t dues
Term loans

Total
Working capital

Total