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Project Appraisal Oct, 13

This document summarizes the key aspects of a project appraisal process conducted in October 2013. It outlines the appraisal of a project's managerial capabilities, technical feasibility, economic feasibility, and financial feasibility. It also describes the cost components of the project, means of financing including promoter's contribution and borrowings, and the appraisal methods used, specifically coverage ratios and sensitivity analysis.

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Amit Giri
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65 views6 pages

Project Appraisal Oct, 13

This document summarizes the key aspects of a project appraisal process conducted in October 2013. It outlines the appraisal of a project's managerial capabilities, technical feasibility, economic feasibility, and financial feasibility. It also describes the cost components of the project, means of financing including promoter's contribution and borrowings, and the appraisal methods used, specifically coverage ratios and sensitivity analysis.

Uploaded by

Amit Giri
Copyright
© Attribution Non-Commercial (BY-NC)
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPT, PDF, TXT or read online on Scribd
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PROJECT APPRAISAL

OCTOBER,2013

APPRAISAL PROCESS
Managerial & Technical capabilities of the promoters and top management team man behind
the project technical qualification character past track record etc.

Technical Feasibility of the Project


Economic Feasibility Financial Feasibility
Equity / subsidy etc.

suitability of technology, location, cost of land, machinery, track record of contractors/suppliers

profitability & sustainability of the business, prospects of industry, demand supply gap, Govt. policy etc.

funding needs of the project viz. Debt /

COST OF PROJECT
Consists of
Land & Land Development cost Factory Building Plant & Machinery Electrical Installation / Power connection

Pre-operative & preliminary expenses


Margin for working capital

MEANS OF FINANCE
Promoters Contribution Share Capital, Internal Accruals,
Quasi capital etc.

Borrowings Term Loans, Deferred Payment Guarantee, Lease & HirePurchase

APPRAISAL METHOD
Coverage Ratio :
i)Interest coverage ii)Debt Service coverage ratio (DSCR)

Sensitivity Analysis :
i.Reduction in sales by 10% ii.Reduction in PAT by 10% iii.Increase in RM cost by 10% iv.Increase in RM cost & reduction in sales by 10% each

THANK YOU

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