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    General Shop - 5 Lakhs

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    Shyamal Dutta
    1) Miss Sendenchila Imchen is requesting a term loan to expand her general store, M/s. LA Store, which has been operating successfully since 2005 but now faces increased demand that requires more working capital. 2) The proposed expansion would increase the store's monthly working capital from its current Rs. 3.14 lakh to Rs. 9 lakh to purchase additional stock and supplies. 3) The projected profits over 5 years indicate the store would be able to repay the requested Rs. 5.3 lakh loan amount with average debt service coverage ratio of 2.88:1.

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    General Shop - 5 Lakhs

    Uploaded by

    Shyamal Dutta
    1K views6 pages
    1) Miss Sendenchila Imchen is requesting a term loan to expand her general store, M/s. LA Store, which has been operating successfully since 2005 but now faces increased demand that requires more working capital. 2) The proposed expansion would increase the store's monthly working capital from its current Rs. 3.14 lakh to Rs. 9 lakh to purchase additional stock and supplies. 3) The projected profits over 5 years indicate the store would be able to repay the requested Rs. 5.3 lakh loan amount with average debt service coverage ratio of 2.88:1.

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    General shop - 5 lakhs

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    1) Miss Sendenchila Imchen is requesting a term loan to expand her general store, M/s. LA Store, which has been operating successfully since 2005 but now faces increased demand that requires more working capital. 2) The proposed expansion would increase the store's monthly working capital from its current Rs. 3.14 lakh to Rs. 9 lakh to purchase additional stock and supplies. 3) The projected profits over 5 years indicate the store would be able to repay the requested Rs. 5.3 lakh loan amount with average debt service coverage ratio of 2.88:1.

    Copyright:

    © All Rights Reserved
    Download as DOC, PDF, TXT or read online from Scribd
    Download as doc, pdf, or txt
    1K views6 pages

    General Shop - 5 Lakhs

    Uploaded by

    Shyamal Dutta
    1) Miss Sendenchila Imchen is requesting a term loan to expand her general store, M/s. LA Store, which has been operating successfully since 2005 but now faces increased demand that requires more working capital. 2) The proposed expansion would increase the store's monthly working capital from its current Rs. 3.14 lakh to Rs. 9 lakh to purchase additional stock and supplies. 3) The projected profits over 5 years indicate the store would be able to repay the requested Rs. 5.3 lakh loan amount with average debt service coverage ratio of 2.88:1.

    Copyright:

    © All Rights Reserved
    Download as DOC, PDF, TXT or read online from Scribd
    Download as doc, pdf, or txt
    of 6

    PROJECT PROPOSAL FOR WORKING CAPITAL SUPPORT

    FOR EXPANSION & UPGRADATION OF


    M/s. LA STORE
    I.M. ROAD, SANGTEMLA WARD
    MOKOKCHUNG : NAGALAND

    INTRODUCTION :-
    Cosmetic, gift items, stationeries, children care, students needs and other
    daily needs items comes under General Store, these items have huge
    demand in the market. People whether poor or rich cannot live in this
    modern world without these items, they spend major part of their income
    on these items. Now-a-days there is a mass infiltration in the towns from
    various parts of the rural areas where natural resources are gradually
    disappearing at the advent of modernization.

    The shop namely – M/s. LA Store was started in the year, 2005 at Imna
    Meren Road of Mokokchung Town by Miss Sendenchila Imchen. The shop
    has been managing/running successfully by the promoter herself with the
    help of paid staffs, but now she is facing lots of hardship for maintenance of
    the shop since day by day demand of stationery/cosmetics/daily needs are
    increasing and this kind of business require to have huge inventory because
    of thousand of commodities and introduction of new products every now
    and then by the companies. Therefore, it is felt necessary to keep all kinds
    of stocks in good numbers to meet customers demand or to fulfill the
    market demand. Hence, she is approaching for Term Loan from bank for
    expansion and upgradation of the shop.
    FINANCIAL ASPECTS

    1. FIXED CAPITAL Amount(Rs.)

    It is already furnished Nil

    2. WORKING CAPITAL (PER MONTH)

    a) Employees Remuneration Amount(Rs.)


    i) Manager - 01 No. -Self-
    ii) Sales man 02 Nos. @ Rs.2000/- per month 4,000.00
    iii) Sales man - 1 No. @1500/- 1,500.00
    5,500.00

    b) Raw material

    i) School stationery, cosmetics, and other daily


    needs items etc. 3,00,000.00

    c) Other Expenses
    i) Rent (SHOP-CUM-STORE) 2,000.00
    ii) Electricity charges 500.00
    iii) Travelling & transportation 5,000.00
    iv) Licence fee & miscellaneous 500.00
    8,000.00

    TOTAL WORKING CAPITAL (For one month)

    1. Employees remuneration 5,500.00


    2. Raw materials/stock 3,00,000.00
    3. Packing materials 1,000.00
    4. Other expense 8,000.00
    3,14,500.00
    TOTAL COST OF THE PROJECT

    1. Fixed capital --

    2. Working capital 9,00,000.00


    (only raw materials stock for 3 months)

    Total 9,00,000.00

    MEANS OF FINANCE

    1. Promoters Contribution 3,70,000.00

    2. Loan from Bank 5,30,000.00

    Total 9,00,000.00

    LOAN REPAYMENT STATEMENT & AVERAGE CALCULATION OF INTEREST

    (Rs. in lakhs)
    st nd rd th
    Particulars 1 yr. 2 yr. 3 yr. 4 yr. 5th yr.
    Principal 5.30 4.24 3.18 2.12 1.06
    Less : Repayment 1.06 1.06 1.06 1.06 1.06
    4.24 3.18 2.12 1.06 --
    Interest 0.60 0.45 0.32 0.19 0.10
    PROJECTED PROFITABILITY STATEMENT

    (Rs. in lakhs)
    st nd rd th
    Particulars 1 year 2 year 3 year 4 year 5th year
    No. of working days 360 360 360 360 360
    Sales realization (10%) 41.40 43.47 45.64 47.92 50.32
    above stock purchase)
    Cost of production
    Purchases of stock 36.00 37.80 39.69 41.68 43.76
    Packing materials 0.12 0.14 0.16 0.18 0.20
    Salaries & wages 0.66 0.72 0.78 0.84 0.90
    Rent 0.24 0.24 0.24 0.30 0.30
    Electricity 0.06 0.07 0.08 0.09 0.10
    Travelling & 0.60 0.63 0.66 0.69 0.72
    transportation
    Miscellaneous including 0.06 0.08 0.10 0.12 0.14
    licensing etc.
    Total 37.74 39.68 41.71 43.9 46.12
    Gross Profit 3.66 3.79 3.93 4.02 4.20
    Depreciation @10% 0.10 0.10 0.10 0.10 0.10
    (existing assets)
    Interest on loan 0.60 0.45 0.32 0.19 0.10
    Net Profit 2.96 3.24 3.51 3.73 4.00

    STATEMENT OF BREAK EVEN POINT


    Fixed cost Amount (Rs.)

    1. Rent 24,000.00
    2. Salary (40%) 26,400.00
    3. Other expenses (40%) 19,200.00
    4. Depreciation 10,000.00
    5. Interest 60,000.00
    Total 1,39,600.00

    Fixed cost x 100


    B.E. P. = ---------------------------------------------------
    Fixed cost + Net profit

    = 32.05%

    STATEMENT OF DEBT SERVICE COVERAGE RATIO

    Rs. in lakhs
    Particulars Years

    Net Profit 2.96 3.24 3.51 3.73 4.00


    Depreciation 0.10 0.10 0.10 0.10 0.10
    Interest on Loan 0.60 0.45 0.32 0.19 0.10
    Total (A) 3.66 3.79 3.93 4.02 4.20
    Principal repayment 1.06 1.06 1.06 1.06 1.06
    Interest on Loan 0.60 0.45 0.32 0.19 0.10
    Total 1.66 1.51 1.38 1.25 1.16
    D.S.C.R. (A/B) 2.20:1 2.51:1 2.85:1 3.22:1 3.62:1
    Average 2.88:1

    PROJECT PROPOSAL FOR


    UPGRADATION/EXPANSION OF
    M/s. LA STORE
    Imnameren Road, Mokokchung
    Nagaland

    Applicant/Proprietor

    MISS SENDENCHILA IMCHEN


    Mokokchung : Nagaland

    Compiled by :-

    SUKANTA DEY & ASSOCIATES


    Chartered Accountants
    Dimapur – 797112 : Nagaland
    09436013659

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