NOTE FOR THE ASTT.

GENERAL MANAGER , RASMECCC MUZAFFARPUR

Note no.-RASMECC/RKR/ 315/2010-11 Date:-16.06.2010
APPRAISAL MEMORANDUM FOR SANCTION OF WORKING CAPITAL LIMIT OF
Rs.40.00LACS & TL OF Rs49.00LACS TO “M/S USHA POLY PLAST” Under
SMECFL Scheme with a coverage under CGTMSE.
S FORMAT: Section A
EXECUTIVE SUMMARY
CIRCLE:PATNA BRANCH: BELA INDUSTRIAL ESTATE
COMPANY/UNIT: M/S USHA POLY PLAST
Section Contents Pages
1 Borrower profile
a. Name , Address, Manufacturing activity/Locations, Date of 2
incorporation, Banking arrangement etc of
b. Brief Background(Company/ Group/ Promoters/ 2
Management including shareholding pattern )
c. Brief write up on Industry/Sector and Company’s standing 2
d. RMD Advisory/qualitative approach/Quantitative
approach/Comments 3
e. Indebtedness/Exposure & capital charge
3
2 Present Proposal
a. Proposal : For sanction/approval/confirmation 4
b. Credit limits (existing and proposed) 4
c. Sharing pattern 4
3 Performance Details
a. Performance and Financial indicators 5
b. Industry exposure as on 6
c. Movement in TNW 6
d. Synopsis of balance sheet 7
4 Risk assessment :
a. Credit Rating 8
b. Risk and mitigating factors 8
c. Warning signals/Major irregularities in Inspection
Audit/Credit Audit/Other Reports 8
d. Security 8
e. Changes in Security if any, justification 8
5 Pricing
a. Conduct of account 9
b. Income analysis 9
c. Other Bank’s/FIs pricing 9
d. Proposed pricing 9
6 Loan Policy : Deviations & Compliance:
a. Whether names of promoters, directors, company, group
concern figure in defaulters/willful defaulters list
b. Deviation in Loan policy 10
c. Deviation in Take over norms and comments 10
d. Directors of Borrowers company: status of relation with 10
Board/ Sr Official of the bank etc 10

7 a. Future plans & Business Potential including cross 11

selling/retail marketing 11
b. Environmental and sustainability implications 11
c. Earlier terms of Sanction: Compliance status 11
d. Statutory dues /Contingent Liabilities 11
8 a. Justification for the Proposal 12
b. Recommendations : 12

SBI,RASMECCC/MUZAFFARPUR , M/S USHA POLY PLAST 1

 SECTION 1

Branch : Bela Industrial Estate

Circle: Patna
Borrower’s Profile
a..Name , Address, Manufacturing activity/Locations, Date of incorporation, Banking
arrangement etc of
Company: M/S USHA POLY PLAST
Address:
Regd Office: Plot no-3,Near Raman flour mill, Industrial Area, Bela,
Muzaffarpur
9431013820
Mfg facility( Locations): --do--

Residence : Near Bharat Scout & Guide,Ward no-13,Sikandarpur,

Muzaffarpur
Segment: SSI Constitution: Proprietorship IRAC Status-
New connection
Advances : N.A
Investments : N.A
Industry: Mfg. Activity : Manufacturing of PVC Pipes.
Date of incorporation: New connection(However running a CA with Bela
Industrial Estate Br.a/c no- 30715927780 )
Banking arrangement : Sole Banking

Existing Connection : Yes/No New unit : YES/ No If Take over, whether all
If yes, date of last norms complied with :
sanction/renewal: NA (Yes/No) N.A

b) Brief Background (Company/ Group/ Promoters/ Management including shareholding

pattern):

• Mr. Shiv Nath Prasad Gupta, S/o Sri Ragir Prasad Gupta, resident of Near Bharat Scout
& Guide, Ward No.13, Sikanderpur, is well experienced and have good job knowledge of
the activity.
• He is belonging from business community having genetic characteristics of business.
• He has an experience of more than 12 years.
• He had started his first Mfg unit of PVC pipe in 1999 in the name & style of M/s Krishna
Plastic at Bairiya Chowk, Muzaffarpur. The business is running satisfactorily and the
promoter has earned goodwill. The following table illustrates the working of the firm
during last three years of its existence. The table are:
(Rs. In lac)
Year 2007-08 2008-09 2009-10
Sale
Profit after Tax
Net Profit/ Net Sales (%)
TOL
TNW
TOL/TNW
Current Ratio

• The promoter after improvement in industrial environment of State, particularly, law &
order situation, has decided to shift his unit to Industrial Area, Bela, Muzaffarpur and
hence applied to the authority for allotment of land but new name, “M/s USHA POLY

SBI,RASMECCC/MUZAFFARPUR , M/S USHA POLY PLAST 2

 PLAST”. Incidentally, the first name “USHA” is his wife name. The concerned authority
has allotted a piece of land measuring about 43560.Sq.ft. to the unit.
• The promoter has finally shifted working of his unit from Bairiya to Bela in December
2009 and started working with new name, “M/s USHA POLY PLAST”. The promoter has
informed us that the unit M/s KRISHNA PLASTIC has been closed in April 2011 after
completing all formalities and liquidating statutory dues to the unit.

• The unit, M/s Usha Poly Plast, has ISO 9001:2008 quality certificate no – NS - EN ISO
9001:2008 from Norsk Akkreditering of Norway (An international organization for
quality certification).
• The unit has VAT no-10312771058 /CST NO-10312772149 ; Weight & measurement
license no-505/2010 dt-25.01.10; Challan for Rs4163/- dt-06.03.2010 for labor &
employment license fee.
• The promoter is presently manufacturing HDPEE Roll Pipe, PVC Section Pipe, PVC
Garden Pipe and proposed to manufacture PVC Rigid Pipe. He has assessed the
investment in manufacturing facility for proposed activity, which is large enough. He is
unable to meet by himself and hence requested us to sanction a term loan of
Rs.49.00lac and working capital limit of Rs.40.00lac.

c) Brief write-up on industry/sector and company’s standing (domestic / international) in

the industry including market share, future growth strategies, comments on recent news
reports, etc. ( To mention / dovetail Premarketing Committee Presentation, if applicable).

With the burgeoning economic growth, providing adequate infrastructure facilities to a populous
country like India is very important. Pipelines used in transportation of oil, gas and water are
crucial in developing a nation’s infrastructure. Transportation through pipes is cheaper and
faster as compared to traditional modes of transport like road and rail. Pipes also have a long
useful life of approximately 25-30 years for Steel pipes, 25 years for PVC pipes and 70-75 years
for Cement pipes.
The Indian Pipe Industry is among the top three manufacturing hubs after Japan and Europe.
However, the penetration level of pipelines in oil and gas transportation is low at 32% in India as
compared to 59% in USA and 79% globally. The pipeline network of India for oil and gas
transport stood at 13,517 kms in April 2006. Sanitation levels are also lower at 33% in India
compared to 91% in Srilanka and 100% in France. Of 140 mn hectares of cultivable land, only
40% the land is irrigated. The low penetration levels represent the huge scope for growth for the
pipe industry.
The positive trend in the Indian pipe industry is to be continue in the next 3-5 years on the back
of high oil and gas discoveries worldwide, increased efforts by GoI on infrastructure
development for laying pipelines for oil and gas transport, water and sewage transport and
irrigation facilities.
Demand triggers for the growth are:
GoI increased the annual budget allocation under the Rajiv Gandhi Drinking Water Mission from
• Rs. 46 bn to Rs. 58 bn in Union Budget 07-08.
For the XIth five year plan, GoI is aiming to add 11 mn hectares of irrigational facilities, entailing
• an investment of Rs. 1,580 bn.
Growth in the real estate sector due to growing population and affluence will require
investments • in water, drainage and sewage systems.
GoI in its efforts to reduce crude imports has formulated the New Exploration Licensing Policy •
for exploration and production of oil and gas. 165 blocks have been awarded till date and the
number is set to increase to 245 by 2008.
Private players like RIL, Cairn have shown interest in setting up pipe infrastructure for oil & gas •
transport. National gas grid will also be set up requiring an investment of Rs. 210 bn.
City gas pipe is currently available in 10 cities and the coverage is expected to grow to 40 cities
in • next 5-7 years.
In addition to above, replacement demand from USA & European countries, having a vast
pipeline • infrastructure, will be huge.

SBI,RASMECCC/MUZAFFARPUR , M/S USHA POLY PLAST 3

Hence, in view of above, we can safely say that the unit has very good chance to flourish its
wing freely

d)
i.
RMD Advisory dated #: 10.06.2010 for qualitative approach & data
dt-31.03.08&11.08.08 for Quantitative approach.
There is no clear cut instruction about Plastic insustry, We have taken the
information about Chemical sector(organic + inorganic).
ii. Qualitative approach : For Chemicals sector - Moderately +ve (1.5)
iii. Quantitative approach: FB exposure as % of Bank’s total FB exposure-within
1.5% (organic + inorganic).
• Total FB level as on 31.03.2010-Rs 4306.97 CRORES i.e. -0.80%
(for organic + inorganic)
iv. Comments: The proposal merits consideration as there is enough gap and the
promoter has strong back up support on professional, managerial, social and
financial levels.

#As per extant instructions contained in the STATE BANK OF INDIA, CRAVC, RMD, MID
CORPORATE REGIONAL OFFICE, LHO, BANGALORE. Dt-10.05.2010 CRMD Out look
is to be incorporated in addition to the RMD advisory details.The status of CRMD outlook
for the proposed proposal is detailed as under:-

Name of the extant Proposed to be Threshold for additional exposure

Advisory changed to read as
Enhancement New
Grow Selectively Moderately Positive SB 10 and above SB 8 and above

comments In the proposed proposal the CRA rating is SB-5 againast the
threshold SB-8 for additional exposure and hence within the
acceptable Band.

e) Indebtedness / Exposure & Capital Charge:

Company Group Proposed exposure

Indebtedness Existing Proposed Existing Proposed Credit Risk
conversi weight
on factor
Fund based 0.00 89.00 NA NA NA as no 100% as
Non fund based 0.00 0.00 NA NA NFB company
TOTAL 0.00 89.00 NA NA Limit account
(Indebtedness) proposed is
Investment 0.00 0.00 NA NA . unrated.
Leasing 0.00 0.00 NA NA
TOTAL (Exposure) 0.00 89.00 NA NA

Capital charge for Total exposure : Risk

weight applicable to the rating of the
borrowerx11 %= Rs 89.00 Lacs x 100 %
(as account is unrated) x 11 % =
Rs.9.79lacs

SBI,RASMECCC/MUZAFFARPUR , M/S USHA POLY PLAST 4

 SECTION 2
PRESENT PROPOSAL:
Proposal:
a. For sanction of :
i. Sanction of Cash Credit (stock) limit of Rs. 40.00lacs .

ii Sanction of TL of Rs.49.00lacs
.

b. Approval of:
NA
c. Confirmation of
NA

The proposal falls within the powers of Assistant General Manager, SBI RASMECCC
as
FB / NFB / Total indebtedness is Rs.89.00 lacs, Non-Corporate
(ii) Involves policy level deviations: N.A
(iii) _________________ is a director in ________________ Bank. N.A

b.Credit Limits (Existing and Proposed) : (Rs. in lacs)

Existing Proposed Change

Limits SBI % Total SBI % Total SBI Total
Cons/ Cons/ Cons /
MBA. MBA. MBA.
C/C (Stocks) 0.00 N.A N.A 40.00 100 N.A 40.00 N.A
C/C (Book Debts) 0.00 N.A N.A 0.00 N.A N.A 0.00 N.A
Total FBWC 0.00 N.A N.A 40.00 100 N.A 40.00 N.A
TLs 0.00 N.A N.A 49.00 100 N.A 49.00 N.A
Total FB 0.00 N.A N.A 89.00 100 N.A 89.00 N.A
LC 0 N.A N.A 0 N.A N.A 0 N.A
BG 0.00 N.A N.A 0.00 N.A N.A 0.00 N.A
Total NFB 0.00 N.A N.A 0.00 N.A N.A 0.00 N.A
Total 0.00 N.A N.A 89.00 100 N.A 89.00 N.A
FB+NFB

c. SHARING PATTERN: Not Applicable (Sole Banking)

Financial Arrangement: Sole Banking/Consortium/ Multiple Banking
Lead Bank:
FB NFB Total
SBI 89.00 0.00 89.00
Ass.Bks. 0 0 0
SBI Group 0 0 0
Other Banks 0 0 0
Total 89.00 0.00 89.00

SBI,RASMECCC/MUZAFFARPUR , M/S USHA POLY PLAST 5

 Performance Details
SECTION 3
a. PERFORMANCE AND FINANCIAL INDICATORS: (Rs. in lac)
Parameters 2009-10 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16
AUD EST PROJ PROJ PROJ PROJ PROJ
Domestic Sales(Gross) 23.30 150.00 318.33 378.39 412.99 447.58 482.17

Export Sales 0.00 0.00 0.00 0.00 0.00 0.00 0.00

Net Sales 23.30 150.38 318.33 378.39 412.99 447.58 482.17

% rise/fall (-) in net sales 545.41% 111.68% 18.87% 9.14% 8.38% 7.73%
Profit Before tax 0.04 4.52 0.01 8.82 13.20 17.17 20.72

PBT/ Sales (%) 0.17 3.01 0.00 2.33 3.20 3.84 4.30

Profit After Tax 0.04 4.52 0.01 7.39 10.41 13.16 15.62

PBDIT/Interest (times) 0.86 7.18 2.01 2.71 3.14 3.64 4.23

Cash Accrual 0.86 7.18 12.30 17.87 19.36 20.80 22.14

Paid Up Capital 22.63 33.88 42.93 42.93 42.93 42.93 42.93

TNW 22.67 38.44 47.50 54.89 65.30 78.46 94.08

TOL/TNW (times) 0.72 1.44 2.19 1.73 1.32 0.99 0.74

Adjusted TNW 22.67 38.44 47.50 54.89 65.30 78.46 94.08

Adjusted TOL/TNW 0.72 1.44 2.19 1.73 1.32 0.99 0.74

NWC 6.28 23.51 16.85 25.96 36.56 49.80 64.38

Current Ratio 1.49 1.60 1.35 1.53 1.75 2.05 2.35

Comments only on adverse movements in the above: (Not to exceed 5-6 lines)

FINANCIAL KEY FACTORS:-

Sales / Gross Receipt:

The sale for the year 2009-10 is based on audit report & VAT return submitted to the
department. The sale for the year 2009-10 was only for four months operation of the unit. The
sales as per VAT return for Q1 to Q3 during 2010-11 is Rs122.10lacs.Hence estimated sales of
Rs150.00lacs for 2010-11 appears reasonable.

The promoter has estimated sales turnover for the unit conservatively considering only 8
hours working in a day and 25 days working in months at 100% capacity utilization. The total
sales receipt of the unit is Rs.691.89lac, existing products Rs.488.08lac and Rs.203.81lac of
proposed product.

SBI,RASMECCC/MUZAFFARPUR , M/S USHA POLY PLAST 6

 He has taken capacity utilization of each products and receipt is as follows:

Year 0 2012 2013 2014 2015 2016 2017 2018

Existing Products
Cap. Uti 100% 60% 65% 70% 75% 80% 85% 90%
Amt. 488.08 292.85 317.25 341.66 366.06 390.46 414.87 439.27
Proposed Products
Cap. Uti 100% 25% 30% 35% 40% 45% 50% 55%
Amt. 203.81 25.48 61.14 71.33 81.52 91.71 101.91 112.10
Total 691.89 318.33 378.39 412.99 447.58 482.17 516.78 551.37

The sale receipt from proposed product is taken for only six months during first year. The selling
price of each product, like Suction Pipe @Rs.80/-Kg, HDPE Roll @Rs.90/-Kg, Garden Pipe
@Rs.48/-Kg, Rs.65/-Kg, delivery pipe @Rs.90/-Kg and PVC Rigid Pipe @Rs.70/-Kg and
Rs.88/-Kg is par with prevailing with prevailing wholesale market price.
Hence, in view of above, the estimated & projected sale appears reasonable and may be
accepted.

Raw Materials & Consumables:

The basic raw material for the unit is RESIN which is easily available. The biggest
manufacturer & supplier of the resin is Reliance Industries Ltd. The additives for the industry is
calcium carbonate, one pack, CPW, DOP, Asteric Acid, Yuvamol etc used for different quality
of products. The price taken for appraisal for the main raw materials & additives is at par with
prevailing market price. The promoter has conservatively taken 1% wastages whereas it is
negligible for the industry.

PBT/Net Sales:
The profitability of the unit increases from 0.71% to 3.01% in the year 2010-11 due to
increase in volume of sale but decreases to nil, in the year 2011-12, due to increase in burden
of depreciation & interest. However, thereafter it is improving during the year under
consideration.

TNW:
The increase in TNW during 2010-11 is Rs.15.77 lac .This is due to introduction of
capital of Rs21.50lacs (supported by a CA certificate ) & withdrawal of Rs10.25lacs & plough
back of profit of Rs4.52lacs. Fresh introduction of Rs.9.05lac during 2011-12 is mainly for
margin purpose. Thereafter the increase in TNW is due to plough back of profit.

TOL/TNW:
The highest ratio during the year under consideration is 2.19 in the year 2011-12 when
present proposal is to be implemented. Thereafter the ratio is below 2.

Current Ratio:
The current ratio is more than acceptable level 1.33 during the year under consideration.
The lowest current ratio is 1.35 in the year 2011-12, during the year of implementation of
present proposal.

SBI,RASMECCC/MUZAFFARPUR , M/S USHA POLY PLAST 7

 Whole Bank
b.Industry
Level Q/HY results Prev. year Current Year
Exposure as on
(Rs. in as on ________ (2008-09) (2009-10)
crores)
FBL 4306.97 Net Sales

NFBL 1342.11 Exports

TOTAL 5649.08 PAT

Exposure of the company as per Prudential Exposure Norms (%)

To Industry Exposure - (%) 0.80%

To Total Advances (Domestic) - (%)

Comments only on adverse movements in the above: (Not to exceed 5-6 lines):

------------------------------NIL----------------------
c) Movement in TNW (projection)
2009-10 2010-11 2011-12
Actual Estimated Projected
Opening TNW 22.63 22.67 38.44
Add PAT 0.04 4.52 0.01
Add. Increase in equity / premium - 21.50 9.05
Add./Subtract change in intangible -- --
assets
Adjust prior year expenses -- --
Deduct Withdrawals -- 10.25
Closing TNW 22.67 38.44 47.50

Comments:-

SBI,RASMECCC/MUZAFFARPUR , M/S USHA POLY PLAST 8

d) Synopsis of Balance Sheet:

Actuals Estimates
2009-10 2010-11
Sources of funds
Share Capital 22.66 38.44
Reserves and Surplus --
--
Secured Loans : short term --
: long term --
Unsecured Loans 3.50 16.30
Deferred Tax Liability
Total 26.16 54.74
Application of Funds
Fixed Assets (Gross Block) 19.47 27.98
Less Depreciation 0.82 3.48
Net Block 18.65 24.50
Capital Work in Progress
Investments
Other Non Current Assets
Inventories 14.19 57.50
Sundry debtors
Cash & bank balances 0.30 0.16
Other Current Assets 1.24 5.33
Loans & advances to -- 1.40
subsidiaries and group
companies
Loans & advances to others 4.59 4.75
( Less : Current liabilities ) 12.75 35.00
(Less : Provisions ) 0.05 3.90
Net Current Assets 7.51 30.24
Misc. Expenditure -- --
(To the extent not written off or
adjusted )
Total 26.16 54.74

Comments only on adverse movements in the above: (Not to exceed 5-6 lines)

SBI,RASMECCC/MUZAFFARPUR , M/S USHA POLY PLAST 9

RISK ASSESMENT SECTION 4
a. CREDIT RATING
Borrower rating Facility rating
WC TL Facilities Existing Proposed
Exist: Prop Exist: Prop Hurdle
rate
CRA NA SB -5 NA SB - 5 SB10 CC+TL NA NA
(76/100) (76/100)
Marks Marks
CRISIL
ICRA
Others
(Marks scored in borrower rating / facility rating to be mentioned).
The CRA of the unit is based on projected balance Sheet as on 31.03.2012. The unit has
completed only for 1 year.

Validated on: No validation committee at this centre.

b. Risks and mitigating factors:

Critical risks perceived Mitigating factors
The promoter is not able to arrange The promoter has already introduces Rs21.50lacs
margin required to complete the during 2010-11 supported by a CA certificate, They
proposl. have proposed to invest Rs9.05lac including Rs2.30lac
as unsecured loan. He is belonging from reputed
business community his son and wife is also engaged
in the business and generating cash. Thus we can
safely say that the promoter will arrange proposed
margin.
Proposed technology & machines The promoter is experienced businessman having
would not full fill requirement. more than 12 years experience of industry. He has
good knowledge of the industry. He has selected the
machines after extensive survey of available
alternatives. Thus we can safely say that proposed
technology & machines fulfill the requirement of the
unit.
Change in Technology of Mfg PVC The proprietor is well acquainted with the activity &
pipes. competent to acquire the latest technology in time.
Tough competition from other players The Government special initiative to increase the
infrastructure facility in the State will increase the
demand of PVC Pipe. The increasing population and
improvement of its economic condition will also boost
the demand of products. Further, the promoter has
genetic characteristics of business as he belongs to
business community will helps in meeting the
competition.
Succession Plan The son of the proprietor is also helping in the present
activity. Hence the succession plan is very well
Raw Material Though there are limited supplier of raw materials of
PVC pipe, the option of import of raw material is open
for the unit.
Failure of BSEB Power Supply The unit had already purchased two generator sets of
125 KVA & 62.5KVA and also proposed to purchase a
DG set of 200KVA to meet the power failure of BSEB.
.The unit has also purchased a 100KVA UPS. Thus
we can safely say that unit is able to meet BSEB
power cut.

SBI,RASMECCC/MUZAFFARPUR , M/S USHA POLY PLAST 10

c. Warning signals / Major irregularities in Inspection report / Credit Audit:/Other reports
Credit Audit Reports N.A. New unit
Other Audit Reports N.A.
Qualification if any, in Auditors report N.A.

d. SECURITY Details Value and basis of Date of valuation

valuation /opinion report
Primary Security  Hypothecation of all For Full value
the assets purchased
out of bank’s finance
inclusive of existing
equipments
 Equitable mortgage of
lease land from BIADA
For others N.A

Collateral security- NIL

Guarantee
NIL coverage under CGTMSE

Changes in security if any, Justification:

NIL

SBI,RASMECCC/MUZAFFARPUR , M/S USHA POLY PLAST 11

 SECTION 5
PRICING:

As per CRA rating SB -5,

For CC – 0.75% over SBAR, i.e. 13.75% p.a. on monthly rests.

For TL – 1.25% over SBAR, i.e. 14.25% p.a. on monthly rests

a) CONDUCT OF ACCOUNT: New connection (last year)

No. of Average period Irregularity report last submitted on
occasions for regularization

Comments:
Irregularity in TL
Comment
s:
Utilisation of limits:
FB Limits Average utilisation NA
%
NFB Limits Average utilization NA
%

b) INCOME ANALYSIS: ( Rs. in lacs) competition

SBI
From Estimated Actual (last year) Estimates
(last year) (current year)
WC Int. & Charges NA NA 5.60
TL Int. NA NA 6.60
LC NA NA NA
BG NA NA NA
Bill NA NA NA
Forex NA NA NA
Others(Charges ) NA NA 0.60

Interest & Other Charges SBI Share Amount and

percentage
Interest 100%
Other Charges 100%

c. Other Bank’s/FIs Pricing

Existing Proposed
Term Loan NA NA
Working Cap[ital NA NA

d. PROPOSED PRICING:
ITEM Existing Rate Card rate Proposed rate
Int. on WC NA 13.75%(SB-5) 13.75%(SB-5)
Int. on TL NA 14.25%(SB-5) 14.25%(SB-5)
Justification for concessions already extended / proposed: (mention about cost benefit):
No concession is proposed.

SBI,RASMECCC/MUZAFFARPUR , M/S USHA POLY PLAST 12

 SECTION 6
LOAN POLICY: DEVIATIONS AND COMPLIANCE

a. Whether names of promoters, directors, company, group concerns figure in defaulter/willful

defaulters list:
RBI defaulters’ list dated : : Yes/No
Name of the director Default in connection with: Remarks
(Name of the company)
N.A
Justification for considering N.A
continuation / enhancement
in facilities)
Wilful defaulters’ list dated : : Yes/No **
Name of the director Default in connection with: Remarks
(Name of the company
N.A
Justification for considering N.A
continuation / enhancement
in facilities)
ECGC caution list N.A
CIBIL **
**Internet is not working at our outfit, hence search report has not been enclosed. However as
per the CBS report available at our outfit, no any account is NPA as on date.
b. Deviations in Loan Policy:
Parameters Indicative Company's level as on
Min/Max level as per 31.03.2012
loan policy (PROJECTED)
1. Liquidity 1.33 1.35
2. TOL/TNW 3:1 2.19
3. Average gross DSCR (TL) 1.75 2.21
4. Debt / equity 2:1 1.27:1*
5. Promoters contribution 20% of Equity 100% of equity
6. Prudential norms N.A N.A
7. FB exposure to the industry N.A N.A
8. Substantial exposure : N.A N.A
Borrower
9. Substantial exposure : Group N.A N.A
10. Others N.A N.A
Brief comments only if there is deviation (Not more than 5 lines):
*If we consider the unsecured loan of Rs15.00lacs form relatives as quasi equity the
ratio reduces to 0.78 only.

c. Deviations in Take over norms and comments: Not Applicable (New unit)

SBI,RASMECCC/MUZAFFARPUR , M/S USHA POLY PLAST 13

d. Directors of the borrower company are relatives (scope of the term ‘relative as defined in RBI
Master Circular on loans and advances- Statutory and other Restrictions) of any member of the
Bank’s Board/Senior Officer of the Bank/ Member of any other Bank’s Board - Yes/No
If yes, details: N.A

e. Compliance with Section 20 of the Banking Regulation Act : Whether any of the Directors of
the Bank is Director of the borrower company or is having any interest in the same: No

SBI,RASMECCC/MUZAFFARPUR , M/S USHA POLY PLAST 14

 SECTION 7

a. Future Plans & Business potential(over a 3-5 year horizon) including Cross selling / Retail
Marketing based on Co / Group’s future plans: (to be quantified).

Item Present Business

Position – estimated
Whether Tied
Up?
(Yes / No) *
(i) Corporate Salary Package N.A
(ii) P Segment Loans
(a) Housing Y Rs 15.00LACS
(b) Auto Loans Rs 3.00LACS
(c) Personal Loans
(iii) SBI Credit Card
(iv) SBI Life Y Rs 1.00LACS
(v) SBI Mutual Funds
(vi) SBI Vishwayatra Foreign Travel Yatra
Cards
(vii) Vendor/ Dealer Finance
(viii) Any Other (Please specify)(SRTO) Rs7.00lacs

* If no, please advise efforts made and outcome thereof

b. Environmental and sustainability implications:

There is no environmental and sustainability implication. The waste material is reusable
after cutting into pieces. However the unit has already applied for license from Bihar State
Pollution control Board, Patna on 20.11.2008 (Maint.Deptt please ensure to obtain the
necessary license before disbursement loan).

c. Earlier terms of Sanction: NA

d. Statutory dues/other contingent liabilities:

Dues Level (Rs. in crore) Impact on financial
position
Statutory NIL NA
dues
Contingent NIL NA
liabilities

SBI,RASMECCC/MUZAFFARPUR , M/S USHA POLY PLAST 15

 SECTION 8
a. Justification for the proposal: (Only bullet points)
i. The firm is new and the Proprietor Sri Shiv Nath Prasad Gupta is well experienced,
good job knowledge of the activity and skill to manage the unit successfully.
ii. Staffs are well skilled for production activity.
iii. The projected business level, viability and other assumptions and the limits proposed are
reasonable.
iv. The quality of management is satisfactory and the applicant is having adequate
experience in this line of activity.
v. Coverage under CGTMSE hence no collateral security & guarantor required.
vi. Products, in which the firm deals in, have wide acceptance in the market.
Exposure comes under SSI under SMECFL scheme, which are the thrust areas for Bank
Finance.
ix. Estimated sales for 2011-12 Rs.318.33 lac appears justified and achievable.
x. The unit has started its production since End of Dec 2010. CRA has been done on
Simplified Model (Non-Trading) on the basis of Estimated financial statement as
on 31.03.2012 and borrower rating qualifies to SB-5 (Score-76/100) which is
above hurdle rate of SB -10. This shows our risk level as Moderate risk with
adequate cushion and comfort level as adequate safety.
A.Recommended for Sanction on bank’s usual terms and conditions:
In view of the foregoing and the annexure enclosed herewith, we recommend for
(1)For sanction of :
(i) Fresh sanction of CC (stock) limit of Rs. 40.00 lacs ..
(ii) Fresh Term Loan limit Rs.49.00 lacs
Under SMECFL Scheme with a coverage under CGTMSE.

Appraised by Assessed by
Credit Officer Chief Manager (Loan Sanction)
SBI, RASMECCC, Muzaffarpur SBI, RASMECCC, Muzaffarpur
Date: 29.03.2011 Date:
Sanctioned, as recommended, on bank’s usual terms & conditions.
(1)For sanction of :
(iii) Fresh sanction of CC (stock) limit of Rs. 40.00 lacs ..
(iv) Fresh Term Loan limit Rs.49.00 lacs
Under SMECFL Scheme with a coverage under CGTMSE.

Asstt. General Manager

(SBI, RASMECCC, Muzaffarpur)
Date:-

Appraisal Memorandum for term loan: Section B

Circle :Patna
Branch : Bela Industrial Estate Branch
Company : M/s Usha Poly Plast
Term Loan / DPG :
a) Proposal : For purchase of various equipments
b) Project / Purpose : For Mfg. of PVC pipes
SBI,RASMECCC/MUZAFFARPUR , M/S USHA POLY PLAST 16
c) Appraised by : Credit officer
d) Cost of Project & Means of finance : Amount in Lac
Cost Existing To be Total Means Amount in Lac
Incured
L&B 14.37 1.26 15.63 Equity 55.30
:
P&M* 9.84 65.57 75.41 Unsec 15.00
ured
Loan
F &F 0.30 0.30 BIADA 6.00
Security 5.33 5.33
Deposit
Contingenci 1.34 1.34 Debt: 49.00
es
WC Margin 27.29 -- 27.29
Total 57.13 68.17 125.30 Total 125.30
Debt / equity Ratio:-1.27:1

List of Plant & Machineries to be purchased.

Sl.
No. Particulars Suppliers Amount

1 SE-SHAKTI Transformer M/s Sai Enterprises, 170000.00

Jaipur
2 200 KVA DG Sets M/s Jaksons Limited 1060000.00

3 High Speed heater Cooler Mixer, Model HSM 200R CM - M/s Neoplast 1219500.00
400, with Batch Hopper & AC variable Frequency Drive Engineering Pvt. Ltd.,
Ahmedabad

4 24 TR Air Cooled Chilling Plant M/s Blue Star 579075.00

5 Lathe Machines M/s Pathak Industries 381150.00

6 Windsor Make Twin Screw RPVC Pipe Plant, Model KTS M/s Windsor Machines 2255000.00
- 140e/110v Limited

7 Die Inserts Do 190000.00

5854725.00

Add: Taxes, packing exp., transportation, Insurance, erection Charge, @12% 702567.00

Total 6557292.00

# if the cost of equipments increases difference will be born by the applicant .

e).Remarks on Cost of project & Means of finance (in brief):

The cost of plant & machineries is based on quotation as listed above. The supplier is
experienced, reliable and reputed. The promoter has selected after extensive survey of the
market. Some of the quoted amount is ex-factory and hence promoter has made provision
@12% of quoted amount for taxes, packing, transportation, insurance and erection charge. The
SBI,RASMECCC/MUZAFFARPUR , M/S USHA POLY PLAST 17
promoter has requested our finance only for plant & machineries with a margin of 25% on each
component of plant & machineries. The promoter has also made provision of Rs.1.26lac for civil
construction which is self estimated. He has made provision of contingencies for the proposed
investment which is reasonable in the era of price rise. The cost of civil construction &
contingencies is to be meet by borrower himself.
He proposed to meet the required margin as under:
Fresh Capital : Rs.9.07lac
Unsecured Loan : Rs.2.30lac
Internal Cash accrual* : Rs.7.80lac
Total : Rs.19.17lac
* The promoter has short term fund of Rs.25.90 lac as per balance sheet dated 31/03/2011
and the promoter has proposed to meet term loan margin and balance is sufficient to
meet working capital margin.

f) Project implementation schedule:

The civil construction work is in progress and expected to be completed within two
months. The promoter has made six months provision from placing of order of
machineries to the start of commercial production. The proposal is ready for commercial
production from 1st October 2011.

g) Production factors:

Power & Fuel:

The unit has required BSEB connection for power supply and proposed to apply for load
enhancement after installation of proposed machineries. However, it has two DG sets of
125 KVA & 62.5KVA and proposed to purchase another one of capacity of 200KVA to
meet the load shedding period BSEB power. Further, it is important to mention here that
the promoter has purchased a UPS for uninterrupted power supply to the unit.

Labour :
Availability of all types of technical, Non-technical, skilled, semi skilled staffs is
abundance in Muzaffarpur. The promoter has long experienced and specialized staffs to
be engaged in unit after completion of new project. Other staffs are already working with
unit.

h) Marketing:
The unit already catch the market of North Bihar, and the finished good is supplied to
samastipur, Sitamadhi, East Champaran, Muzaffarpur, Rosera & Begusarai. In view of
promoter background and long experience we can safely say that the unit has no
problem in marketing of proposed and existing products.

i) Commercial viability:
SBI,RASMECCC/MUZAFFARPUR , M/S USHA POLY PLAST 18
Year 2011-12 2012-13 2013-14 2014-15 2015-16 2016-17 2017-18 TOTAL
Receipt 318.33 378.39 412.99 447.58 482.17 516.78 551.37 3107.61
Net Profit after tax 0.01 7.39 10.43 13.16 15.62 17.80 19.71 84.12
Depreciation 12.29 10.48 8.95 7.64 6.52 5.57 4.76 56.20
Cash Accrual 12.30 17.88 19.38 20.80 22.14 23.37 24.46 140.32
Term Loan
Interest@14.25% and
90% with calculating
On reducing balance 6.60 5.70 4.75 3.79 2.84 1.89 0.93 26.49
Cash for Repayment 18.90 23.58 24.13 24.59 24.98 25.26 25.39 166.83
Term Loan Interest 6.60 5.70 4.75 3.79 2.84 1.89 0.93 26.49
Term Loan Intalment 3.78 7.56 7.56 7.56 7.56 7.56 7.42 49.00
Repayment Obligation 10.38 13.26 12.31 11.35 10.40 9.45 8.35 75.49
Gross DSCR 1.82 1.78 1.96 2.17 2.40 2.67 3.04 2.21
Average Gross DSCR 166.83/75.49 = 2.21
Net DSCR 3.25 2.36 2.56 2.75 2.93 3.09 3.30 2.86

Comments on DSCR (in brief): Average gross DSCR is well above 1.75 in all the years of
repayment period, which is well above acceptable range; It indicates that the cash
accruals are sufficient to service the interest as and when applied and to repay the term
loan installments timely.

j.Security Margin :
2012- 2014- 2015- 2017- TOTA
Particulars 2011-12 13 2013-14 15 16 2016-17 18 L
WDV 80.39 69.91 60.97 53.33 46.81 41.24 36.48 389.14
T/L Outstanding 45.22 37.66 30.10 22.54 14.98 7.42 0.00 157.92
231.2
Margin 35.17 32.25 30.87 30.79 31.83 33.82 36.48 2
Security Margin 100.0
% 43.75 46.13 50.63 57.73 68.00 82.01 0 59.42

Comments on security margin, in brief:

The security margin available with the bank is sufficient enough to recover our dues from the
borrower. In the above table we have only taken into account the primary security available with
us (existing equipments as well as new equipments purchased out of Bank’s finance) excluding
coverage of our exposure under CGTMSE scheme.

k) Break-even and sensitivity analysis and whether acceptable:

Year 2011-12 2012-13 2013-14 2014-15 2015-16 2016-17 2017-18 TOTAL

Capacity Utilisation
% 46 55 60 65 70 75 80 64
318.3 378.3 412.9 447.5 482.1 551.3 3107.
Gross Receipt 3 9 9 8 7 516.78 7 61
282.7 340.9 372.3 403.8 435.5 499.4 2802.
Variable Cost 9 5 3 5 3 467.37 0 22
305.3
Contribution 35.54 37.44 40.66 43.73 46.64 49.41 51.97 9
188.3
Fixed Cost 23.33 29.52 28.40 27.51 26.88 26.47 26.28 9
BEP 66 79 70 63 58 54 51 62
BEP at Rated Capacity 30 43 42 41 41 41 41 40

SBI,RASMECCC/MUZAFFARPUR , M/S USHA POLY PLAST 19

 Average BEP 40

Sensitivity analysis:

As on 31/03 2013 When Sale price When variable Cost When both occurs
nd
2 Year Reduces by 5% Increases by 5%
Situation No. I II III IV
Receipt 378.39 359.47 378.39 359.47
Variable Cost Excl. 41.47 41.47 43.54 43.54
Raw Materials Cost
Profit before tax 8.82 -10.01 6.75 -12.17
Cash for repayment 23.58 13.48 22.14 4.01
Repayment 13.26 13.26 13.26 13.26
Obligation

l) CRA & Pricing : The CRA of the unit is based on estimated financial as on 31.03.2011
is SB-5.

m) Pricing by other major banks / FIs and justification of the proposed pricing :
----------- Not applicable -------------

n) Compliance of the project with environmental / social / statutory requirements:

o) Environment and Sustainability implications :

There is no environmental and sustainability implication. The waste material is reusable after
cutting into pieces. However the unit has already applied for license from Bihar State Pollution
control Board, Patna on 20.11.2008

p) Overall viability and acceptability of the proposal :

In view of the foregoing the proposed venture is considered commercially viable and
profitable.

SBI,RASMECCC/MUZAFFARPUR , M/S USHA POLY PLAST 20

 SECTION C
Assessment of WC facilities:
(If the assessment of the WC limits is based on any other parameters, please specify them
along with an explanation)
a. Inventory & receivable levels : (Months/Days)
2009-10 2010-11 2011-12 2012-13 2013-14 2014-15
Particulars AUD EST PROJ PROJ PROJ PROJ
Raw Material
:a)Indegenous 0.00 0.00 33.00 35.00 37.50 40.00
0.00 0.00 43.61 42.00 41.61 41.04
b) Imported 0.00 0.00 0.00 0.00 0.00 0.00
0.00 0.00 0.00 0.00 0.00 0.00
Stock in Process 0.00 0.00 2.50 2.50 2.50 2.50
0.00 0.00 2.87 2.60 2.40 2.23
Finished Goods 14.19 57.50 18.00 22.50 25.00 27.50
55.29 147.43 21.92 23.67 24.20 24.63
Other Spares :
a)Indigenous 0.00 0.00 0.00 0.00 0.00 0.00
/Consumables 0.00 0.00 0.00 0.00 0.00 0.00
b) Imported 0.00 0.00 0.00 0.00 0.00 0.00
0.00 0.00 0.00 0.00 0.00 0.00
Receivables : a) Domestic 0.00 0.00 7.50 9.00 14.00 20.00
0.00 0.00 8.60 8.68 12.37 16.31
b) Export 0.00 0.00 0.00 0.00 0.00 0.00
0.00 0.00 0.00 0.00 0.00 0.00
Advance Payments 0.04 3.50 0.00 0.00 0.00 0.00
S. Creditors 0.61 0.00 0.00 0.00 0.00 0.00
1.60 0.00 0.00 0.00 0.00 0.00
Other Creditors 12.19 38.90 8.76 8.76 8.76 7.56
Other Current Assets 4.89 4.91 4.61 5.72 6.32 7.36

b. Assessed Bank Finance:

2009- 2010- 2012- 2014-
10 11 2011-12 13 2013-14 15
Particulars AUD EST PROJ PROJ PROJ PROJ
Total CA 19.08 62.41 65.61 74.72 85.32 97.36
Other CL(Ex. Bank Borr.) 12.80 38.90 8.76 8.76 8.76 7.56
Working Capital Gap 6.28 23.51 56.85 65.96 76.56 89.80
Net Working Capital 6.28 23.51 16.85 25.96 36.56 49.80
Assessed Bank Finance 0.00 0.00 40.00 40.00 40.00 40.00
NWC to TCA (%) 32.91 37.67 25.68 34.74 42.85 51.15
Bank Finance to TCA % 0.00 0.00 60.97 53.53 46.88 41.08
S. Cr. To TCA (%) 3.20 0.00 0.00 0.00 0.00 0.00
Other CL to TCA (%) 63.89 62.33 13.35 11.72 10.27 7.76
Inv. To Net sales (days) 183 115 50 48 47 47
Rec. to gross
sales(days) 0 0 7 7 10 13
SBI,RASMECCC/MUZAFFARPUR , M/S USHA POLY PLAST 21
S. Cr.To
purchases(days) 6 0 0 0 0 0

(A) Traditional Method:-

We have appraised the working capital requirement of the unit on the basis of
requirement of the unit, 2011-12
Raw Materials 1.5months Rs.31.96lac
Work in progress 3 days Rs.2.75 lac
{RM+(Salary+Power+Repair+Adm.)/2}
Finished Goods 1 month Rs.25.24lac
Cost of sale – Dep. & Sell. Exp)
Total Rs.59.94lac
Creditors 7 days Rs.5.97lac
W/c Required Rs.53.98lac
Margin, 25% Rs.13.50lac
Permissible Bank Finance Rs.40.48lac
Rounded to Rs.40.00lac
It is assumed here that debtors, which is negligible, and other current assets will be
financed by other current liabilities.

(B) Limit Assessment on the basis of Sales Projection

Projected Annual Turn Over Method: (Amt. in lac)
Particulars 2011-12
a. Projected Annual Turnover (including Excise duty) 318.33
b. Turnover in last financial year ----
c. 125% of turnover in next year -----
d. Total WC required[20% of (a) or © whichever is less] 63.67
e. M.P.B.F. 63.67
f. Recommended Working Capital limit 40.00
CC (stocks) limit of Rs.40.00 lac is being recommended for sanction as assessed above.

c. Assessment of EPC / FBD limits: N.A.

d. Computation of LC limits for WC: N.A

Annual RM Cons.under LC
Monthly RM purchases
Usance
Lead time
L/C Limit required
Recommended LC limit
Documentary : Non Documentary :

Assessment of BG limit: N.A

Outstanding BGs as on 11.05.2010
Add: BGs required during the period (2010-11)
Less: Estimated maturity/cancellation of BGs during the period
(2010-11)
Requirements of BGs
Recommended BG limit
Financial : Performance :

SBI,RASMECCC/MUZAFFARPUR , M/S USHA POLY PLAST 22

f. Efficiency ratios:
2009- 2010- 2012- 2014-
2011-12 2013-14
Particulars 10 11 13 15
AUD EST PROJ PROJ PROJ PROJ
Net Sales/ Total Tangible 0.60 1.61 2.10 2.52 2.72 2.87
PBT/ Total Tangible Assets
0.10 4.83 0.01 5.88 8.71 11.01
(%)

Operating Cost to sales (%) 99.83 96.99 100.00 97.67 96.80 96.16
Bank Finance/ Ct. Assets
0.00 0.00 60.97 53.53 46.88 41.08
(%)
Inventory+ Receivables to
183 115 57 55 57 60
net Sales
ROCE(%) (PBDIT/TTA) 2.21 7.67 16.19 20.41 21.44 21.92

Brief comments on the assessment of the above limits:

h. Fund Flow Analysis :

2010-11 2011-12 2012-13 2013-14 2014-15
Particulars EST PROJ PROJ PROJ PROJ
Long Term Sources 31.23 61.51 17.87 19.36 20.80
Long Term Uses 14.00 68.17 8.76 8.76 7.56
Surplus/Deficit 17.23 -6.66 9.11 10.60 13.24

Comments:
Fund Flow analysis shows satisfactory situation except in the year 2011-12 this due to
facts during the year 2011-12 the promoter will use short term fund as margin for proposed
proposal.

SBI,RASMECCC/MUZAFFARPUR , M/S USHA POLY PLAST 23

Terms & Conditions: SECTION D
CIRCLE: PATNA

COMPANY/ UNIT: M/S USHA POLY PLAST

A. SECURITY :

Facility Primary Collateral Guarantee

CASH CREDIT Hypo. of Stocks & Existing NIL NIL
equipments*
TL Hypo. of equipments to be NIL NIL
purchased out of Bank’s
finance.
*Detailed list of equipments must be taken before documentation.
Collateral security Details
NIL coverage under CGTMSE.
Coverage under CGTMSE vide SMU-BU/119/2009-10 dated 09.07.2009 and SME-BU/6 dated
31.01.2009
Coverage Upfront service Fee Annual Service Fee
Credit facility- Above Rs.5 lakh to 1.50% of loan amount 0.75% of loan amount
Rs.50.00 lac =
75% of the amount in default
subject to a maximum of
Rs.37.50 Lacs
Credit Facility-Above 1.50% of loan amount 0.75% of loan amount
Rs50.00lacs up to Rs100.00lacs=
Rs37.50lacs plus 50% of amount
in default above Rs50.00lacs
subjected to overall ceiling of
Rs62.50 lacs.
Maintenance Dept. please ensure completion of all formalities regarding CGTMSE coverage
and kept on record.Compliance report on SMECFL separately enclosed as Annexure elsewhere
in the porposal.

B. ECGC COVER:N.A
C.
D. MARGINS : (FOR EACH FACILITY AS APPLICABLE)

Cash Credit: Existing Proposed

RM:
Domestic
Imported 0 25%
SIP 0 25%
FG 0 25%
Receivables (Cover 30 days) N.A NA
Letter of Credit N.A NA
BG(Cash Margin) NA NA
TERM LOAN 0 47.77%

Justification for deviation from existing margins, if any to be provided in the proposal. NO

SBI,RASMECCC/MUZAFFARPUR , M/S USHA POLY PLAST 24

 E. RATE OF INTEREST: As per CRA Rating SB 7
Facility CRA Pricing
CC (Stock) SB 7 SB 7 (1.50% over SBAR, i.e.13.25% p.a.)
TL SB 7 SB 7 (2.00% over SBAR, i.e.13.75% p.a.)
(The above rate will reassessed at the time of next renewal exercise based on fresh CRA at that
time . For the first year the rate will applicable according to the SMECFL scheme i.e.-For CC
stock 10.00% fixed & for TL 10.50% fixed)
F. Insurance: Comprehensive inter-alia covering risk against Fire, theft, riots, flood,
earthquake, and civil commotion. In transit insurance to be done. Other risk to be
covered whenever considered necessary by the bank.
G. Processing fees:
For working capital -Rs.250/- per lac to be realized for CC limit.
For TL- Up front fee:0.63% (50% concession in processing charge under
SMECFL scheme.Cir no-NBG/SMEBU-SMECFL/61/2009-10 dt-12.01.2010)
H. Inspection: Monthly by Bank’s officials.
I. i) REPAYMENT SCHEDULE : Rs 63000/- per month
ii) Repayment to start from : -------- Oct. 2010.
J. Other terms & conditions* (Please see on page 20.)
K. OTHER CRITICAL COVENANTS:
Note: Any change in the terms and conditions vis-à-vis earlier sanction should be justified in
the proposal.
*TERMS AND CONDITIONS of CC (stocks) limit:
Margin 25% of stocks .
Bank’s charge Hypothecation of Stocks and equipments (existing as well as new to
be purchased out of Bank’s Finance).
E/M charge NA ,
Repayment CC- Repayable on demand.
TL-In 78 monthly installment of Rs63000/-+intt.(as & when
applied)starting form Oct.2010. The Intt. will be serviced by the unit
during moratorium period.
Validity of Sanction, Sanction valid for 12 months.
Review/Renewal A renewal shall be made after 12 months after satisfactory conduct
of account.
TL a/c should be reviewed annually .
Stock Statement To be submitted monthly.
(Maintenance Deptt. please ensure to meticulously follow the bank’s
instruction in this regard.)
Non Submission of Rs.200/- if not submitted within 7 days of due date.
Stock statement*
Processing Fee For working capital -Rs.250/- per lac to be realized for CC limit.
For TL- Up front fee:0.63% (50% concession in processing
charge under SMECFL scheme.Cir no-NBG/SMEBU-
SMECFL/61/2009-10 dt-12.01.2010)
Sales Transaction Entire sales proceeds must be routed through the CC A/c.
Documents As per Revised Simplified SME Documentation
Inspection Monthly at irregular intervals by RASMECCC/Branch official.
Maintenance of Books The unit to maintain proper Books of account to show the business
transaction.
Dealing with The Borrower shall deal only with SBI, Bela Industrial Estate Branch
bank/branch and shall close all accounts with other Banks, if any.
Commitment Charges* If unutilized portion is 60% and above of the credit limit then 0.25%
p.a. on entire unutilized portion to be realized.
Non submission of For limit above Rs.25.00 lac- Rs.1200/- per month, if not submitted
audited balance sheet* within 6 to 8 months of year end.
Penal Interest* 2% on irregular portion. If irregular more than 60 days on entire

SBI,RASMECCC/MUZAFFARPUR , M/S USHA POLY PLAST 25

 outstanding.
Other terms & All other terms and conditions will be also applicable.
conditions
Other Stipulations, if • An undertaking is required to be obtained stating therein
any. that they would not be any inter firm transaction without
bank’s knowledge.
The CA certification for initial capital infusion to be taken
before release of Loan amt.
(*Vide Circular no. CCO/CPPD-SERVICE/CHA/39/2007-08 dt.17.08.2007)
ANNEXURE-IV

Compliance of SME COLLATERAL FREE LOAN scheme

UNDER GUARANTEE COVER OF CGTMSE (SMECFL)
“M/S USHA POLY PLAST” WORKING CAPITAL LIMIT OF Rs.40.00LACS& TL OF
Rs49.00LACS
(Vide circular no-SME/RKG/CIR-63/2009-10 DT-12.01.10 & SME/MKS/CIR-18/2010-11 DT-
18.05.10)
Micro & Small Enterprises as defined by
MSMED Act 2006. Applicant’s age is 45 years
a. The chief promoter /chief executive
should be 21to 65 years of age in case of
non corporateborrower.
b. New and existing Micro and Small NEW
Enterprisesengaged in Manufacturing
and service sector.
Note : In respect of Micro & Small enterprises in
Target Group service sector, Branches are advised to adhere
to the RBI's guidelines on lending to Priority
Sector i.e. small road and water transport
operators, small business, professional and self
employed persons and all other service
enterprises under the ambit of Micro and Small
Enterprises definition under MSMED Act are
covered but finance to retails/wholesale trade,
educational institutions, training institutions and
SHGs are not eligible under the scheme.
i. For Loans up to Rs.25 lacs
The applicant must obtain a minimum overall
score of 50% under each sub-head of Business
& Personal and 60% in overall score except
collateral details as per the scoring model of
SME Smart Score. The score under collateral
Screening of
has to be normalised with Business & Personal
details parameter score.
Eligibility
ii. For Loans between Rs.25 lacs to Rs.
1.00Crore iii. CRA rating of
Units having CRA Rating of SB-10 and above as SB-7 has been accessed
per the applicable revised CRA rating norms as for the unit
circulated by Risk Management Department from
time to time.
CGTMSE Being Proposed
Guarantee Mandatory
Coverage
Purpose a. Working capital needs (FB+NFB). Working capital of
b. Term loan for construction of Building, Rs40.00lacs
office,acquisition of machines / equipments TL of Rs49.00lacs for

SBI,RASMECCC/MUZAFFARPUR , M/S USHA POLY PLAST 26

 purchase of Verious
including expansion and modernization of the equipments as per details
unit. motioned elsewhere in the
proposal.
a. Manufacturing Enterprises : Manufacturing Enterprises:
Working Capital (WC): As per Nayak Committee Working Capital (WC): (20%
norms (20% of the projected turnover), of the projected turnover),
Term Loan(TL) : 75% of project cost, Term Loan (TL) : 52.23% of
Assessment
b. Service Enterprises: project cost
Working Capital(WC) : 15% of the projected
turnover /Revenue.
Term Loan (TL) : 75% of project cost.
Total Exposure to the unit (FB+NFB) : Above Rs CC(Stock) limit of
5lacs & upto Rs. 1.00 crore (All facilities WC & Rs40.00lacs
Quantum of
TL facilities) TL of Rs.49.00lacs
finance
(Proposals upto Rs. 5.00 lacs have to be Total Exposure to the unit is
coveredunder the scheme "SBI Micro Loans" ). Rs89.00lacs
. CC(stock)
Cash Credit, Letter of Credit, Bank
Type of Facility
Guarantee,Term Loan.
TL
Working Capital(WC) : On
Demand
Working Capital(WC) : On Demand Term Loan In 78 monthly
Term Loan : Maximum Seven Years including installment of Rs63000/-+intt.
Repayment
moratorium period not exceeding 6 months -1 (as & when applied)starting
year. form Oct.2010. The Intt. will
be serviced by the unit during
moratorium period.
Submission of Once in a month
Up to Rs.25.00 lacs, once in a quarter.
Stock
Above Rs. 25.00 lacs once in a month.
Statement
We propose the following concessional rate of for 1st year only
Interest for the first year. Thereafter, the interest Working capital:- Fixed 10%
will be charged at the applicable rate for the p.a.
advance. TL- Fixed 10.50%p.a.
Limits WC & TL for TL for 3 yrs.
< 3 yrs & above

Upto Rs. Fixed 9% Fixed 9.5%

25.00 p.a. p.a. thereafter ROI will according
lacs to the pricing based on CRA
Rate of rating at that time.
Interest
Above Rs. Fixed 10% Fixed
25.00 p.a. 10.50%
lacs to p.a.
Rs.1.00
Cr

The aforesaid concessionary rate of interest will

be applicable to loans sanctioned upto 30th
September 2010.

Loan 50 % of the normal rates. (Applicable on first For working capital

Processing time sanction and annual renewal charges) -Rs.250/- per lac to be
and realized for CC limit.
Service For TL- Up front

SBI,RASMECCC/MUZAFFARPUR , M/S USHA POLY PLAST 27

 fee:0.63% of loan amt.
Charges
Other Charges Normal rates Being proposed
Guarantee fee & Annual Service Fee as per the As per the Part -2 of the
rates prescribed by CGTMSE from time to time Circular no. SME/RKG/CIR-
to be 63/2009-10 DT-12.01.10
CGTMSE Fee
recovered. Details mentioned in the Part -2 of
the
circular.
Inspection of Monthly.
the Exposure upto Rs.25.00 lacs : Once in a quarter.
Unit Exposure above Rs. 25.00 lacs : Monthly.

Primary Security: Assets created out of the Hypo of stock & equipments
credit (existing as well as new to be
facility so extended. purchased by bank finance.)

Other Security: Unencumbered assets which N.A.

are
directly associated with the business for which
the
credit facility is extended. i.e. land & building of
Factory /office/godown which pertains to unit and
Security
associated with the business.
Third Party Guarantee: No third party Personal guarantee of the
guarantee borrower Sri Shiv Nath
other than personal guarantee of the borrower Prasad Gupta.
Promoters, Partners etc.
In case the loan is sanctioned to
Private/Public
Limited company, the guarantee of directors No third party guarantee has
will been obtained.
be treated as third party guarantee.
Annexure -I : Common loan application form for Applied on General
loans upto Rs.1.00 crs. application form on
29.03.10,we have processed
the loan proposal on the
Application
Annexure -II :Appraisal below Rs.25.00 lacs above application only.
and Appraisal
Annexure - III :Scoring Model below Rs. 25.00 We have processed the loan
format
lacs proposal on
Annexure - IV :Annual Review Format S as the loan amount
Loan proposals for loans of Rs. 25.00 to Rs.1.00 is Rs.89.00 lac.
crore have to be appraised on format "S".
Documentation As per Revised Simplified
: As per the SME documentation. SME Documentation

The proposal falls within the

discretionary power of
Sanctioning
As per the scheme of delegation of powers. Astt.General Manager
Authority
(SANCTION), as the total FB
exposures are at Rs.89.00
lacs and segment is SSI.
Credit Rating a. Below Rs. 25.00 lacs : Preliminary screening Here loan amount is above
and eligibility of the entrepreneur as per the Rs. 25.00 lacs, hence
scoring model of SME Smart Score with Simplified CRA rating model
modification in collateral score. As third party as prescribed by CRMD has

SBI,RASMECCC/MUZAFFARPUR , M/S USHA POLY PLAST 28

 collateral security is not applicable to the been enclosed..
scheme, score under personal and business
parameter need to be
normalised to get a score out of 100. (Annexure-
III)
b. Rs. 25.00 lacs to Rs. 1.00 crore Simplified
CRA rating model as prescribed by CRMD. Any
deviation in "Hurdle Scores" against individual
risk parameters has to be approved by the
Competent authority.
Working capital renewal every two years. Being Proposed
However,
Review /
performance of the unit and conduct of account
Renewal
will be reviewed annually for continuation of
limits.
Under the scheme, formalities like valuation, Initially, the proposal was
NEC under CGTMSE coverage
cum lawyer's opinion, physical inspection of scheme only. The required
collateral security, are generally not involved. paper has been submitted by
TAT Hence, after receipt of completed application the unit on 14.06.2010,
form accordingly we have
and documents as per checklist the loan has to processed the proposal on
be 16.06.2010.
sanctioned within two weeks time.
Invocation of In case there is a slippage in the account, Maint.deptt please ensure to
CGTMSE Branch/CPC has to take proactive measure comply all the necessary
Guarantee including invocation of CGTMSE Guarantee in formalities.
the prescribed manner
Other term & Being Proposed
As per CGTMSE coverage
conditions

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