preparing project report

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Rupesh Maheshwari (Querist)
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21 June 2008 plz explain in detail the various aspects/points to be considered while making a project report for term loan/cc
How to make projected/estimated Bsheets

CA. Dashrath Maheshwari

CA. Dashrath Maheshwari (Expert)
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13 November 2008 A Business Plan/Project Report submitted to NEDFi for consideration should include the following information:

1. Description of the project.

2. Promoters, Management and Technical Assistance:

* Detailed Biodata of promoters including financial information.
* Proposed management arrangements.
* Description of technical arrangements (management, production, marketing, finance etc.).

3. Market and sales:

* Basic market orientation: local, national, regional, or export.
* Projected production volumes, unit prices, sales objectives, and market share of proposed venture.
* Potential users of products and distribution channels to be used. Present sources of supply for products.
* Future competition and possibility that market may be satisfied by substitute products.
* Tariff protection or import restrictions affecting products.
* Critical factors that determine market potential.

4. Technical feasibility, manpower, raw material resources, and environment:

* Brief description of manufacturing process.
* Comments on special technical complexities and need for know-how and special skills.
* Possible suppliers of equipment. Ideally three competitive quotations to be enclosed.
* Availability of manpower and of infrastructure facilities (transport and communications, power, water, etc.).
* Breakdown of projected operating costs by major categories of expenditures.
* Source, cost, and quality of raw material supply and relations with support industries.
* Import restrictions on required raw materials.
* Proposed plant location in relation to suppliers, markets, infrastructure and manpower.
* Proposed plant size in comparison with other known plants.
* Potential environmental issues and how these issues are addressed.

5. Investment requirements, project financing, and returns:

* Estimate of total project cost, broken down into land, construction of buildings and civil works, plant and machinery, miscellaneous fixed assets, preliminary and preoperative expenses and working capital.
* Proposed financial structure of venture, indicating expected sources and terms of equity and debt financing.
* Type of NEDFi financing (loan, equity, quasi-equity, a combination of financial products, etc.) and amount.
* Projected financial statement, information on profitability, and return on investment.
* Critical factors determining profitability.

6. Government support and regulations:

* Project in context of government economic development and investment program.
* Specific government incentives and support available to project.
* Expected contribution of project to economic development.
* Outline of government regulations on exchange controls and conditions of capital entry and repatriation.

7. Timetable envisaged for project preparation and completion.

**DM

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