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Submitted By: Jaspreet Singh Manager (Credit) PF No 304701

- M/s Super Agencies, a partnership firm established in 1976, is seeking a term loan of 93 lacs to set up an industrial gas manufacturing plant at its existing location. - The firm is currently engaged in trading industrial gases and welding materials. It has a CC limit of 35 lacs and is rated A. - Key details of the proposed project include a total cost of 149.64 lacs to be funded via a term loan of 93 lacs, capital of 49.75 lacs, and USL of 6.89 lacs. The project involves building renovation, plant and machinery, and is expected to begin commercial production in April 2011. - A technical and economic viability study found

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27 views

Submitted By: Jaspreet Singh Manager (Credit) PF No 304701

- M/s Super Agencies, a partnership firm established in 1976, is seeking a term loan of 93 lacs to set up an industrial gas manufacturing plant at its existing location. - The firm is currently engaged in trading industrial gases and welding materials. It has a CC limit of 35 lacs and is rated A. - Key details of the proposed project include a total cost of 149.64 lacs to be funded via a term loan of 93 lacs, capital of 49.75 lacs, and USL of 6.89 lacs. The project involves building renovation, plant and machinery, and is expected to begin commercial production in April 2011. - A technical and economic viability study found

Uploaded by

danishsamdani
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PPT, PDF, TXT or read online on Scribd
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Submitted By:

Jaspreet Singh
Manager (Credit)
PF No 304701

Firm Name : M/s Super Agencies


Business : The firm had been engaged in the
business of trading in Industrial gases and
welding material & accessories. Now the firm is
putting up a manufacturing plant to manufacture
industrial gases at the present location.

Constitution : Partnership Firm


Rating : A
Existing Facilities : CC Limit of 35 Lac.
Proposed Facilities : Term Loan of 93 Lac.

M/s Super Agencies, a partnership


concern was established in 1976. The
partnership was reconstituted in the year
1998 and since then the firm is having
two partners. Both the partners are
sharing profit and losses of the firm
equally. The firm had been engaged in
the business of trading in Industrial gases
and welding material & accessories. Now
the firm is putting up a manufacturing
plant to manufacture industrial gases at
the present location.

Land
Owned
Building Renovation
16.00
Plant and Machinery 124.64 Term Loan
Misc. Fixed Assets
1.50
Capital
Lab Equipments
1.00
Security
Working Capital
TOTAL

5.50 USL
1.00
TOTAL
149.64

Sources
93.00
49.75
6.89
149.64

Activity
Building
Advance
Machinery
Arrival
Machinery
Installation
Trial Run
Commercial
Production

Starting Date
October 2010
for Already given
of

Completion Date
28 Feb 2011
28th Feb 2011
28th Feb 2011
March 2011
April 2011

5 Years repayable in 60 equal monthly


installments of Rs.1.55 Lacs each starting w.e.f
April 2011.

Documents Submitted With Proposal:

Photocopies of Quotations of plant & Machinery.


Photocopies of Audited B/S of Super Agencies
(Promoter Firm)
Demand Notice regarding required power
connection
Consent from pollution control committee
Approval from chief controller of explosion
Photocopy of SSI Registration
ITRs of previous years

The firm is engaged in trading of


industrial gases such as Oxygen, CO2,
D.A, Argon, Nitrogen, Hydrogen, and
Helium. The party has requisite explosive
license to store the gasses. There is no
dearth of buyers as the party has
established business for more than 35
years and with the industrialization, the
demand is rising day by day.

After Getting Satisfactory CIBIL reports of partners


and firm the TEV Study was completed on 20 th
January 2011. As per the report the proposed unit
of oxygen is technically feasible and economically
viable. The details of TEV Study is as follows
Water
As per the TEV study the unit will require water for
drinking and for chiller plant, water will be
available through tap water supplied by the
Chandigarh Public health.
Quality Control
The product shall meet the required specification,
required in the domestic and industrial market of
gases

Manpower
The unit will employ skilled workers, semiskilled
workers unskilled workers. Besides this, persons
who are technically qualified and experienced
shall be appointed to suitable positions. Party is
having vast experience in trading of industrial
gases and all the partners are educated and they
will manage the manpower without any
hindrance.
POWER
The Unit will require 274 KW power load and
Chandigarh administration has issued demand
notice for 274.78 KW power load to the unit.
Power shall be made available to the unit after
the completion of the civil work.

Raw Material
The unit will require only atmospheric air and
spares of the plant for which party will not face
any problem as air is available free and spares
are to be arranged from the plant supplier. The
requirement of spares is essential for the
smooth working of the plant.

Financial Analysis :
Sales
The sales of the firm as at 31.03.08 was Rs
333.55 lacs & it has increased to Rs 385.96 lac.
The sales has slightly declined to Rs 376.26 lacs
due to short supply from suppliers. The party has
projected sales of Rs 413.88 lac for the current
financial year and achievement of sales of Rs.
322.49 lac up to 31.12.2010
Profitability
The profit of the firm was Rs 5.62 lacs as at
31.03.08 & it has increased to Rs 11.59 lacs as at
31.03.09.The profit as at 31.03.10 has declined
to Rs 8.28 lacs. The decline in the same is due to
high level of depreciation

Other income
The party is having other income in the shape of
cylinder receipts/Misc Income & bank charges
recovered from buyers
Current ratio/Debt Equity Ratio
The Current ratio is above bench mark level for the
last three years. The ratio has declined slightly but is
above bench mark level. The decline is due to
availing bank limit
Debt Equity Ratio
The debt equity ratio as at 31.03.08 was 2.91 and it
has declined to 1.34 as at 31.03.09 & further to 1.24
as at 31.03.10.The DER is satisfactory

Net Working Capital


The net working capital of the firm was Rs 33.31
lacs as at 31.03.08. It has increased to Rs 45.21
lac as at 31.03.09.The NWC has declined to Rs
39.79 lacs during the year ended 31.03.10.The
decline is on account of investment of funds
toward acquiring fixed assets for the firm.
Overall financial position is satisfactory
Stand Alone Project
Debt-Equity Ratio

2.35:1

Average DSCR

1.73:1

Minimum DSCR

1.34:1

The affairs of the business are managed by


both the partners actively and they dont
have any other business interest. Both
the partners are being helped by their
sons in the business. The party has
requisite support staff.

Primary :
Hypothecation of plant and machinery worth Rs.
127.14 lacs.

Collateral :
# 902 Sector 2 Panchkula (Realizable value 175
lac)

Personal Guarantee :
Madhu Gupta (Wife of one of the partners)
Net Means : 84.80 lac

After Loan Approval


Plan layout of building
Undertaking (acceptance of terms & conditions)
Title deeds of property
Hypothecation of moveable assets
Term loan agreement
Agreement of Guarantee

A Rating
The party has its own premises.
Both the partners are well experienced
and running the trading activity
successfully for last more than 36 years.
Party has an established market
High demand of gases in market
Availability of raw material, power and
customers nearby.

Partners have no experience in mfg. of


gases although they are in trading of
gases for long time.
High cost of manufacturing equipment.

The main observation points in the


sanction of loan were

A rating
Conduct of CC account
The securities offered
TEV Study

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