1. Promoter Background & Execution Capability
Before reviewing numbers, credit committees assess the promoter group’s domain experience, existing business track record, net worth and management bandwidth to execute the proposed greenfield or expansion project.
2. Project Cost Breakdown & Means of Finance
Every cost head—land development, technical civil works, indigenous/imported plant and machinery, electrical installations, contingency and margin money for working capital—must be supported by competitive vendor quotations or chartered engineer/architect estimates.
3. Realistic Capacity Utilisation & Input-Output Norms
Assuming 90% capacity utilisation in Year 1 rarely passes credit scrutiny. A well-structured DPR models gradual ramp-up, realistic power, fuel and labour costs, and industry-benchmarked gross margins.
4. DSCR, Moratorium & Sensitivity Analysis
Lenders test whether projected cash accruals comfortably service term loan interest and principal (DSCR) even if selling prices dip by 5%–10% or raw material costs rise. Properly aligning the repayment moratorium with the actual commercial production date prevents early cash-flow strain.