Project and Working Capital Finance

Performance Optimization   >   Project and Working Capital Finance

Home Project and Working Capital Finance

Finance is the life blood of any organization, having too less of blood leads to anemia in human beings, similarly paucity of finance leads to decrease in activities or shelving of future expansion plans of any organization and may even lead to failure of business.

  • Project Financing: Project finance is a long-term financing method used for large capital-intensive projects, such as infrastructure projects, power plants, or manufacturing facilities. The significance of project finance for a business lies in the fact that it allows companies to fund large projects without putting a strain on their working capital or balance sheet. Project finance involves a detailed analysis of the project’s cash flow, risk factors, and financial viability.

The lenders typically rely on the project’s assets and cash flows for repayment of the loan. A project can be financed in multiple modes by the banks, Financial Institutions, Venture capitalists, Private/ Public Equity or any other mode. Funds comes in the form of Term loan, Private Equity, External Commercial Borrowings (ECBs), Venture Capital, Debentures, Equity & Preference shares etc.

  • Working Capital Financing: Working capital finance, on the other hand, is a short-term financing method used for day-to-day operations of the business. The significance of working capital finance for a business lies in the fact that it helps companies manage their cash flows and meet their short-term obligations, such as payments to suppliers and salaries to employees.

The lenders usually assess the borrower’s creditworthiness, financial history, and current assets and liabilities while extending working capital finance. Beside own money Banks and Financial Institutions fulfils working capital requirements. Popular modes of working capital finance facility by banks include Over Draft (OD), Cash credit (CC), Packing Credit limit PCL), Bill Discounting, Factoring, Buyers Credit, Suppliers Credit, letter of credit etc.

How Can MNRS Help?

MNRS provide advisory services to its clients in securing Project & Working Capital Finance. We provide end to end services starting from assessment of client requirements, preparation of project reports, projected/provisional financial statements, meeting with bankers/financers etc. till finalization of funding and disbursement. Our range of services covers debt funding, Private Equity (PE) Funding etc. through Banks, Financial Institutions (FIs) and High Net-worth Individuals (HNIs). We also assist in optimum mix of various finance products in order to optimize overall cost and meet peculiar finance needs. We have liaison with various banks, financial institutions and other funding agencies and possess deep insight of the procedures adopted by them for appraisal of the finance proposal.

Our services in project working capital financing typically involves:

  • Financial statements: Our team can prepare and present the financial statements of the business to the lenders, which can help in assessing the creditworthiness of the business.
  • Financial analysis: Our team can assist in preparing a detailed financial analysis of the project, including cash flow projections, sensitivity analysis, and risk assessment. This analysis can help the lenders in understanding the viability and potential risks of the project.
  • Loan application: We can assist in preparing the loan application, including providing the required documents and information, such as audited financial statements, cash flow projections, and business plans.
  • Structuring the financing: We can assist in structuring the financing for the project, including identifying the suitable financing options, the optimal debt-equity ratio, and the repayment schedule.
  • Negotiation: A CA can assist in negotiating with the lenders for the best possible terms and conditions, including the interest rate, collateral requirements, and repayment schedule.
  • Compliance: We also ensure that the project meets all the regulatory requirements and compliances, such as environmental clearances, approvals from government agencies, and tax-related matters.
  • Due diligence: MNRS can assist in conducting due diligence on the project, including reviewing the project documentation, verifying the financial statements, and assessing the legal and regulatory risks.