How to get debt and only debt???

Others 402 views 4 replies

robin

Manager

39 Points Posted on 12 April 2010

Hello folks!

I am starting a cold storage business and i have initial capital of Rs 17 Lacs. i require 9 crore capital to start my business. I am in talks with certain private lenders but their rate of interest is very high, 25-30% pa :(
I have a pvt ltd company. is this possible:
1) to raise debt from private equity or investment banks
2) acquire land and construct cold storage plant and warehouse
3) mortgage the above property with the lenders as collateral
4) pay the lenders principal and interest af the 5th year

how can i achieve the above goals? what are the available options for me? my dad is not tata-birla nor are my friends mittal-ambani, but i do have faith in myself and my business.

your advice will be highly appreciated

thank you

Replies (4)

Guest

Well.... dear it is advisable to consult good professionals who are expert in it. As it is a ball game of 9 crores and ofcourse 17 lacs of your own funds

Remember one thing NEGOTIATION is the crux of any deal......

robin

Manager

39 Points Posted on 13 April 2010

@ Kaushik

Thanks for you reply. I did approach a financial consultant with my project report, but i was baffled by the way he put out things. Despite the good ROI the consultant told me banks will only fund if the promoters equity is 45-50%
If i had that much equity, i would not have approached the banks in first place?
Anyways, since then, i took it on me as a challenge and approached a leading MNC bank in india and told them about my venture, i told them i would collaterize the property post funding and now i have a meeting with them next week!

Problem is i dont have a good consultant on my side, but i'm searching anyways, see the professional fees is not the issue, i am looking for someone who is farsighted and understandable, since it is a scalable business we have to convince the banks to lend us their money, and we would be doing all this in good faith, protecting the interests of the banker as well as the company as a whole.