What does this clause mean?

Hello,

If a company wants to raise Rs 100 Crore finance for a project , it can go for public issue to the extent of Rs 25 Crores. Balance Rs 75 Crores should be tied up either through means of term loan , promoters contribution , underwriting , private placements , ECB , FDI etc.

Confirmed (firm) arrangements should have been made which can be verified by SEBI. The arrangement should be for 75% of the stated financing requirements. It should not include the amount to be raised through the public/rights issue or any internal accruals.

R.V.Seckar

Thank you very much Sir

Firm arrangements of finance "through verifiable means" towards 75% of stated menas of finance, excluding the amount to be raised through proposed IPO or indentificable internal accurals

If,

Total Cost of Project          :  Rs. 2300 crores

Less: Proposed IPO          :   Rs. 2000 crores

Funds required excluding the net proceeds of the IPO: Rs.300 crores

Required firm arrangements for over 75% of the funds required excluding the IPO :  Rs. 225 crores (i.e. 75% of Rs. 300 crores)

Accordinlgy, 

Rs. 225 crores should be finance through verrifiable means of finance for exp. bank or company should have internal accruals to the extent of this amount. Generally for internal accurals companies provided a CA certficate that they have the sufficent cash and bank balance in hand.

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