Proposal

STATE BANK OF PATIALAREGIONAL OFFICE - III (DELHI)

FORMAT - 'S'APPRAISAL MEMORANDUM

Company: LALSONS ENTERPRISES

Zone: DELHI - III Branch: MEERUT CITY

Segment: C&I/SIB/AGL Industry: C&I

Proposal: a) FRESH TERM LOAN AND CASH CREDIT FACILITIESb)c)

Credit limits (existing & proposed): IN LACS Limits Existing Proposed Change SBP % CONS. SBP % CONS. SBP CONS.FB Total FBWC NIL NIL NIL 20 100 NIL 20 NILTerm Loan NIL NIL NIL 110 NIL NIL 110 NILTotal FB NIL NIL NIL 130 100 NIL 130 NIL FLCs NIL NIL NIL NIL 100 Nil NIL NilBGs NIL Nil Nil Nil Nil Nil Nil NilTotal NFB NIL NIL NIL NIL NIL NIL NIL NilFB+NFB NIL NIL NIL 130 100 NIL 130 NILTOTAL (FB+NFB) NIL NIL NIL 130 100 NIL 130 NIL

Note: 1. That the proposal have already been sanctioned by Central Bank of India , Jail Chungi Branch on 11-03-2005 as follows:

1. CC (Hyp. of Stock) Rs. 10 Lacs2. Term Loan Fresh

Against Land Rs. 62.50 LacsAgainst Building Rs.22.50 Lacs Rs. 85 Lacs

The Party have already been taken up a term loan of Rs. 62.50 Lacs against land and the party had purchased a land measuring 2724.17 sq. mtrs valued Rs. 127 Lacs including stamp duty on 16-04-2005 and started his construction for building for setting up a Petrol Pump of Reliance Industries Ltd. in their supervision and direction.

2. We have canvassed the party to shift their proposal in our bank by offering the enhanced credit facilities as above . Our AGM Sh. Alreja Ji has also visited the site and satisfied with the proposal and directed to go ahead.

The proposal falls within the power of DGM as

i) FB/NFB/Total indebted is Rs. 130 Lacs orii) Involves policy deviations or iii) Other reasons (specify)

1. Company profile : LALSONS ENTERPRISES1.1 Address of the Regd. Office : 94-E, Jawahar Quarters, Begum Bridge Road, Meerut1.2 Corporate office : 94-E, Jawahar Quarters, Begum Bridge Road,

Meerut1.3 Constitution : Proprietorship Firm

1.4 ActivityDealer for Reliance Outlet* by setting up a petrol pump at Major Dhyan Chand Nagar, Main Delhi

Road, Meerut.Activity –Dealer for Reliance Outlet* by setting up a petrol pump at Major Dhyan Chand Nagar, Main Delhi Road, Meerut.

Group/promoters 1. Sh. Yogesh Chandra

CEO Sh. Yogesh ChandraDate of Incorporation - August 1, 2004 Banking with us GROP Nilsince/newconnection* Take over from Central Bank of India, Jail Chungi, Meerut

EXPOSURE

Date of last FB 130 LacsRenewal : Not Applicable NFB Nil Total 130 Lacs

* New unit or takeover to be mentioned1.5 Mfg. Units/locations at: Major Dhyanchand Nagar, Main Delhi Road, Meerut1.6 CRA (WC/TL)/Pricing) : CRA and pricing are as per circular no. dated

Working Capital Term Loans

Existing Proposed Existing ProposedCRA N.A.

As per circular no. Dated

N.A.As per circular no. DatedPricing (Fixed /

floating) Other ratings, if available

1.7 IRAC statusi) Advances : Standard as on 30-06-2005ii) Investments :

2. Financial arrangement : Sole Banking (Sole banking/consortium/multiple banking)

2.2 If consortium/MBA - Name of the lead bank/major bank : Not ApplicableNames of other banks & their shares

2.3 Indebtedness/Exposure (Rs. In Lacs)

Indebtedness Existing ProposedFund based Cash Credit (Stock) Nil 20 Sub Limit Cash Credit Book Debts (on older than 30 days) Nil

10

Term Loan Nil 110Non fund based

Nil Nil

Total (indebtedness) Nil 130

Investments NilLeasing NilTotal (exposure) Nil 130

2.4 Position regarding prudential exposure limits of RBI (if applicable)

2.5 Position of Account (s) : Standard as 30.06.2005

3. Performance & financial indications(Figures in Lacs)

Projected Projected Projected Projected2007 2008 2009 2010

Net Sales 1328.81 1395.25 1495.01 1538.26(exports)Op. profits 32.41 34.15 35.86 37.60PBT 23.09 25.80 28.56 31.43PBT/N Sales 1.74 1.85 1.95 2.04PAT 18.74 20.88 23.06 25.33Cash accrual 23.74 25.39 27.41 29.25PBDIT 38.61 40.15 41.70 43.32PUC 70.00 70.00 70.00 70.00TNW 87.54 106.92 128.49 152.02TOL/TNW 1.97 1.50 1.14 0.86TOL/Adj. 1.97 1.50 1.14 0.86TNW 87.54 106.92 128.49 152.02Current Ratio 2.06 2.16 2.27 2.38NWC 41.36 47.15 53.82 61.11Gross Block 186.00 191.00 196.00 201.00Net Block 179.80 178.80 177.95 177.23

Note: 1. That the net sales are expected to increase atleast 5% per annum and estimated sales are calculated by assuming 360 working days in a year and calculation of sales are as under:

Petrol Normal 1000 Ltr. x 43.08 x 360 days 155.09 Diesal 10000 Ltr. x 31.27 x 360 days 1,125.72 Lubricants 4 Lacs per months x 12 48.00

Total Rs. 1,328.81

2. That the firm is also planning to open a café and small departmental store as per specification and direction of RIL therefore, we have planned to extension of building as and when required necessary from our internal accruals. Hence, the above gross block shows a increasing value.

3. In spite of above all other ratios including TOL/TNW, Current Ratio as well as Cash accruals shows a sound and satisfactory position of the firm.

Industry Exposure : FBL NFBL Total

No. of units

% of gross NF C & I limits at C. Centre NPA amount % age of NPAs to exposure

QUARTERLY/HALF YEARLY PERFORMANCE AS ON

Pre. Yr. Curr. Yr. As on 30-06-2005

Net Sales NilPAT Nil

3.2 Movement in TNW (three year)As on 31-03-2007 31-03-2008 31-03-2009

Opening TNW 70.00 87.54 106.92Add PAT 18.74 20.88 23.06Add: Increase in equity/premium -- -- --Add./Subtract change in intangible -- -- --Assets -- -- --Adjust prior year expenses -- -- --Less: Withdrawls 1.20 1.50 1.50Closing TNW 87.54 106.92 128.49

4. Brief (background (company/group/promoters/management ):Name (s) of Directors with share holding pattern: -

Sh. Yogesh Chandra Gupta proprietor of M/s Lalsons Enterprises is a approved army contractor and general order suppliers for last 20 years and effected sales 39.15 Lacs during the financial year 2003-04 and he applied for a setting up a petrol pump on 30-08-2004 for appointment as dealer for Reliance Retail Outlet located at Delhi Road, Meerut City (U.P.) Reliance Industries Ltd has already issued a letter of Indend (LOI) on 15-01-2005 for setting up a petrol pump at Major Dhyan Chand Nagar, Delhi Road, Meerut by taking Rs. 3 Lacs in advance as signing amount and proprietor have already purchased required land 2724.17 Sq. Mtr. at Major Dhyan Chand Nagar, Delhi Road, Meerut for amounting to Rs. 127.00 Lacs and construction of Building have already been started.

The proprietor of M/s Lalsons Enterprises have already been obtained NOC from Distt. Fire Officer Meerut, Distt.. Supply Officer Meerut, Director of Industries Meerut copy of NOC’s is enclosed for your kind reference.

5. Performance & financials (whether overall financial condition is considered satisfactory including trends in sales, profitability, tangible networth, TOL/TNW and current ratio- No. descriptive Remarks to attempted):

Data Not Applicable

Proprietor have a good reputation in Meerut, being a new proposal/establishment past records of the unit are not available.

6. Industry Scenario : (including contemporary issues such as WTO impact/prospects of thecompany - brief comments not exceeding 5-6 lines).

As we all know that these petroleum products are used to run two wheelers, motorcars, commercial vehicles, etc and during last few years the consumption of these petroleum products had increasing very drastically as the number of vehicles on road had increased too much. Further, the future scope of these petroleum products is also very bright as there is no substitute to it.

Detailed Survey regarding market of the proposed products have been conducted by the Reliance Industries Limited. Copy of the survey report with Central Bank of India, Jail Chungi Meerut it would be available after the takeover of the proposal. The loacation of the site is highly suitable being the existing developed area. The firm has decided to open a Coffee Shop and a Small level Departmental Store having emphasis on confectionery & other eatable products at a later stage.

It would be pertinent to mention here that there is no petrol pump in the density of 3 to 5 km at the side of proposed petrol pump.

6.2 Inter company comparison :

Name of the FBL* NFBL* year Sales PBT/ TOL/ CRcompany ended Sales TNW

Data Not Available

i) To be filled in only where comparable data are availableii) In case of consortium, limits availed from the consortium to be given.

6.3 Industry average /benchmark (where available)PBT/net sales Net Sales / total Bank finance / Inventory + tangible assets current assets receivables / net sales

Data Not Available

7. Fund flow analysis: (only brief observations, regarding cash accruals vis-à-vis projections, repayment of TLs, infusion of E/QE, investment in FA/Dividends, retention of profits and diversion if any).

The firm is engaged in petroleum products which are generally sold out in cash and estimated sales projection in the coming years are very lower side because firm has estimated sales of 1000 Ltr. of Petrol and 10000 of Ltr. Diesal per day. Keeping in view the situation of petrol pump it is very very justified. Hence, cash accruals as estimated in CMA are nearby actuals because dealer firm will earn Rs. 1.20 on Diesal and Rs. 0.80 on Petrol and all the future expenditure has

already been considered including salaries to sales delivery men electricity, generator exp., repair & maintenance and other selling expenses.

Keeping in view the cash accruals of the firm, and DSCR during the financially year 2006-07 to 2012-13 which is not less than 1.84 and average DSCR 1.88, the repayment of term loan will be made easily. The proprietor will withdraw only a small amount for his house hold exp. And most of the profits will be retained in the firm.

8. Term Loan/DPG : (where applicable) The proposed term loan is considered acceptable in terms of the detailed appraisal as per Annexure-I

9. Working capital assessment : (The proposed working capital facilities are considered acceptable in terms of the detailed appraisal as per annexure-II

10. Other details:

The proposal has already been sanctioned by Central Bank of India, Jail Chungi, Meerut and we have canvassed to the party to shift their account in our bank.

10.1 Pricing by other banks/justification for the proposed pricing:

The proposal will fall under the scheme of setting up a petrol pump of Reliance Industries vide circular no. dated

10.2 Capital market perception (price) Not Applicable(High/Low [52 weeks])

10.3 Value of Account

Year under Previous review Year Utilization of accounts/other income

Average utilization of fund based limits

Not Applicable being a new accountValue of account (past 12 months)

- Interest /Discount - Exchange - Commission - Forex business : Sales Purchase Comments on pro-rata share

10.4 Details of retail banking / any other business generated through the account.

Bank’s sign board will be displayed on the premises of petrol pump which will attract the retail business.

10.5 Comments on associate concerns : Nil

Particulars Comments

Interlocking of funds N.A.NPAs among associate concerns Any other adverse features

10.6 Use of provisional/un-audited data - In case earlier renewal / encashment was based on provisional / un-audited data whether review with audited data, as specified was carried out and appropriate steps initiated?

Not Applicable

10.7 RMD exposure norms

10.8 Loan Policy guidelines The following quantitative parameters as set out in the loan Policy Document have been examined:

Parameters Indicative min/max

Company's levelas on 31-03-2007

level Liquidity Min. 1.33 2.06 TOL/TNW Max. 3.00 1.97 Promoters' Min. 25% 30.43% contribution to the project (TL) Average gross DSCR Min. 1.75 1.88 (TL) Debt/equity Max. 2:1 2.28

If any of the above indicative minimum/maximum parameters is not met by the company, please state whether it is considered acceptable (only brief comments):

In addition to debt/equity ratio are within acceptable level and shows a sound position of the firm. Keeping in view the unsecured loans from relatives and friends which is part and parcel of equity because these unsecured loans will not be the paid till the continuances of the bank term loan therefore unsecured loans should be treated as a equity/capital. Hence, debt/equity ratio would be 0.92 only which is highly acceptable.

10.9 Deviations from loan policy

Deviation Major/minor Mitigating. factorsMaturity of TLs Exposure norms (individual, non- corporate and corporate) Minimum CRA scores Hurdle rates (other than industry NOT APPLICABLE Specific hurdle

ratesIndustry specific hurdle rates Take over norms Any othe deviations

10.10 Whethera) the name of the company/directors appears in RBI's list of defaulters/RBI's list of defaulters / RBI's list of

willful defaulters: : NO

Name of the Defaulting Capacity Our Policy RemarksDirectors Company

We confirm that the Board approved Bank's policy regarding granting of facilities to the company has been strictly followed and granting of facilities to M/s Lalsons Enterprises is acceptable to the Bank.

b) the company's name figures in ECGC's caution list: : NO

If so, details and comments:

10.11 Status of auditor's remarks, which have an impact on credit risk on the unit

Particulars Date Serious irregularities / Action adverse features plan Inspection & audit report (covering security margin & Conduct of account) Not applicable being a new unit Credit audit report (warning signals) Company's audited balance sheet (qualifications)

10.12 Corporate Governance practices followed

M/s Lalsons Enterprises is a proprietorship firm and corporate governance are not applicable but all policies of corporate governance will be followed.

10.13 Conduct of account (covering irregularities, non-compliances, LC developments. BG invocations, etc.) :

There are no past record available in our bank. Hence, conducting of account could not be comment.

10.14 Details of other borrowing arrangements and defaults, if any (excluding information given under credit limits on page 1)

Nil

10.15 Comparison of pricing and other terms and conditions with SBI/Associate Banks

As per circular no. dated

10.16 Legal Compliance Certificate : Legal compliance certificate will be obtained after sanction.

10.17 CIBIL clause (state whether stipulated in the terms) : will be obtained

10.18 Date Chart (State whether attached?) : As follows

Inspection of the unit. 15-06-2005Received of Proposal 30-06-2005Sent proposal to RO 02-07-2005

11. Status of compliance with terms & conditions of sanction/observations of HOCC/EC:

All the terms & conditions of the sanction will be followed by the firm.

12. Critical risk factors and their mitigation: Nil

13. Justifications & recommendations for the proposed facilities :

1. Term Loan

The firm is going to setup a petrol pump of Reliance Industries Ltd. and projected cost of Building and other fixed assets have been analysied by Reliance Industires Ltd. and detailed market survey conducted by M/s Reliacne Industries Ltd and a copy of letter indend has been issued to the party by taking Rs. 3 Lacs as signing amount. Further the Central Bank of India sanctioned a term loan of Rs. 85 Lacs i.e. Rs. 62.50 Lacs purchasing a Land and Rs. 22.50 Lacs against building at a margin of 50%. We have considered the cost of building Rs. 50 Lacs cost and recommended as follows:

1. Term Loan against Land Rs. 62.50 Lacs with a margin of 50% 2. Term Loan against Building Rs. 30.00 Lacs with a margin of 40%3. Security/Advance payment to RIL Rs. 17.50 Lacs with a margin of 25%

2. Working Capital

Keeping in view the holding level of stock as well as debtors. The firm has to invest heavy funds in working capital of the business and the firm has to maintained a level of stock for smooth running of our business. Therefore, we recommend a working capital limit of CC(H) Rs. 20.00 Lacs with a sub limit of 10 Lacs against book debts not older than 30 days.

Calculation of Average Stock

Average Stock Capacity Average Rate ValueIn Ltr. Stock 50 %

PetrolNormal 20000 10000 43.08 430800Premium 20000 10000 44.64 446400

DiesalNormal 40000 20000 31.27 625400Premium 40000 20000 33.12 662400

LubricantsMobile Oils, Lubricants etc. 585000

Total 2750000

14. Submitted for sanction.(A) Term Laon: 1. Term Loan against Land Rs. 62.50 Lacs

2.Term Loan against Building Rs. 30.00 Lacs3.Term Loan for security to RIL Rs. 17.50 Lacs

(B) Working Capital Limit CC(H) Rs. 20.00 Lacs With a Sub Limit of Rs. 10.00 Lacs Against book debts not older than 30 days.

15. Pre-Sanction visit comments: Pre-Sanction visit was conducted by Branch Manager alongwith Field Officer.

16. Comments on opinion Report of Existing Banker (s) if any:

Existing banker Central bank of India Jail Chungi, Meerut will try their best to retain his accounts but and their

opinion are seems to be good.

Signature :

Designation of the recommending authority:

Date:Place:

Should briefly cover (not more than 10 to 12 lines)a) Why the proposal is considered a fair banking risk and is being recommended.b) b) Why after due consideration of various deviations and risk factors, the proposal is being considered

acceptable and is being recommended.c) Why changes in terms and conditions, if any, are being recommended.

Annexure – IZONE : Delhi - IIIBranch : Meerut CityCompany : M/s LALSONS ENTERPRISES

Term Loan/DPG :

a) Proposal : Term Loanb) Project/Purpose : To set up a petrol pump of RILc) Appraised by : Sh. F.C. Sharma, Branch Manager and Sh. R.K. Verma Field Officerd) Cost of project & means of finance

Cost Means

LAND 127.00Prop. Capial

70.00

BUILDINGActual CostInterest during construction period

50.00

5.00 Unsecured Loans

50.00

P&M 2.00

Term Loan against Land 62.50

Other assets 25.50

Term Loan against Building 30.00

WC margin 20.50

Term Loan for Security/Advance payment 17.50

Total 230.00 Total 230.00

e) Remarks on cost of project & means of finance (in brief)

The investment in Land have already been incurred of Rs. 127 Lacs while the projected cost of Construction of Building of Rs. 50 Lacs are estimated by Reliance Industries Ltd.’s architect and detailed map have already been submitted for your kind reference which was also appraised by Central Bank of India and the detailed architect estimate was submitted to Central Bank of India and Rs. 5 Lacs approx. for interest of construction period has been estimated which will be capitalized in the cost of building.

The cost of Plant & Machinery Rs. 2 Lacs includes, DG Set, Water cooler, Air Compressor Machine and other tools which is required smooth running of petrol pump.

The cost of other assets Rs. 25.50 Lacs includes Rs. 23.50 Lacs of security/advance payment to Reliance Industries Ltd. and Rs. 2 Lacs for computer, fax, furniture & fixture etc.

f) Project implementation schedule

Particulars Commencement Completion

Land purchase July 2004 March 2005Building Civil Work April 2005 September 2005Installation of Plant & Machinery October 2005 November 2005Trial Run December 2005 February 2005Commercial Activity March 2006 ----

Repayment of Term Loan in

84 equated monthly installments of April 2006 March 2013Rs. 1.70 Lacs started from

g) Production factors

The petrol pump is not a production unit, it is a retail outlet of M/s Reliance Industries Ltd. located on national highway Delhi Meerut Road, Meerut and is surrounding by well developed industrial area as well as well developed new colonies.

h) Marketing

The firm will perform its activity under the proprietorship of Shri Yogesh Chandra and will be trading in various petroleum products viz Petrol, Diesel, Mobile Oils, Lubricants, etc. These petroleum products are extensively used to run two wheelers, motor cars, commercial vehicles, etc. During last few years the consumption of these petroleum products had increasing very drastically as the number of vehicles on road had increased too much. Further, the future scope of these petroleum products is also very bright as there is no subsitute to it and there is no petrol pump within two three five K.M. in the side of proposed unit. Hence, no problem for selling the petroleum products.

I) Commercial viability Figures in Lacs

Capacity utilization % 31-03-07 31-03-08 31-03-09 31-03-10 31-03-11 31-03-12 31-03-13Sales 1328.81 1395.25 1465.01 1538.26 1615.18 1695.94 1780.73Net Profit 18.74 20.88 23.06 25.33 27.67 30.12 32.65Cash accruals 23.74 25.39 27.41 29.25 31.48 33.65 36.11Interest 7.82 6.85 5.80 4.66 3.44 2.12 0.70Total 31.56 32.24 33.21 33.91 34.92 35.77 36.81TL/DPG repayments 12.58 13.55 14.60 15.74 16.96 18.28 18.29Interest 7.82 6.85 5.80 4.66 3.44 2.12 0.70Total 20.40 20.40 20.40 20.40 20.40 20.40 18.99Gross DSCR 1.55 1.58 1.63 1.66 1.71 1.75 2.01Net DSCR 1.89 1.87 1.88 1.86 1.86 1.84 1.97

Comments on DSCR (in brief)

The gross DSCR are continuously increasing this seems to a strong position of the firm and the minimum gross DSCR 1.55 have been increased upto 2.01 while the net DSCR Average is 1.88 which is more than the acceptable level.

j) Security margin

Particulars WDV of fixed assets Agg. TL/DPG outstanding Security margin available % of margin

Comments of security margin, in brief:

k) Break - even and sensitively analysis and whether acceptable: Not applicable being a trading unit.

i) CRA & Pricing: As per circular no. dated

m) Pricing by other major banks/Fls and justification of the proposed pricing

n) Overall viability and acceptability of the proposal:

1. Term Loan



Annexure-II

Assessment of WC facilities

(If the assessment of the WC limits is based on any other parametrs, please specify them alongwith an explanation)

a. Inventory & receivables : (days)

Inventory/Payments

Projected31-03-2007

Projected31-03-2008

Projected31-03-2009

Raw material -Imported -Domestic SIP FG 7.61 8.05 8.95Receivables 6.87 7.32 7.47Sundry Creditors -Import -Domestic (for exp.) 1.00 1.00 1.00

b. Assessed bank finance(Figures in lacs)

Assessed Bank Finance 31-03-2007 31-03-2008 31-03-2009 Projected Projected ProjectedTCA 80.29 87.78 96.26OCL 18.93 20.63 22.44WCGap

61.36 67.15 73.82

NWC

41.36 47.15 53.82

BF 20.00 20.00 20.00 NWC/TCA % 51.52 53.71 55.91BF/TCA % 24.91 22.78 20.78OCL/TCA % 23.57 23.50 23.31

c. Assessment of EPC/FBD limits: Not Applicable

d. Computation of LC limits for WC: Not Applicable

Annual RM cons. Under LCMonthly RM purchasesUsanceLead time LC Limit requiredRecommended LC limit

e. Assessment of BG limit : Not Applicable

Outstanding BGs as on ………………. Add: BGs required during the period Less : Estimated maturity / cancellation of BGs during the period

…………….

Requirements of BGs Recommended BG limit

f. Efficiency ratios

Particulars

P31-03-2007

P31-12-2008

P31-03-2009

P31-03-2010

Net sales to total tangible assets (times) 5.10 5.23 5.34 5.44PBT to total tangible assets (%) 8.87 9.67 10.41 11.11Operating cost to sales (%) 97.56 97.55 97.55 97.56Bank finance to CA (%) 24.91 22.78 20.78 18.96Inventory + receivables to net sales (days) 14 15 16 17

g. Brief comments on the assessment of above limits.

All the above ratios shows a improving position of the firm. While inventory+receivable to net sales (days) a slightly go up by one day in one year, which is acceptable due to increase in working of the firm.

Calculation of Average Stock

Average Stock Capacity Average Rate ValueIn Ltr. Stock 50 %

PetrolNormal 20000 10000 43.08 430800Premium 20000 10000 44.64 446400

DiesalNormal 40000 20000 31.27 625400Premium 40000 20000 33.12 662400

LubricantsMobile Oils, Lubricants etc. 585000

Total 2750000

Keeping in view the above calculation CC Limit of Rs. 20 Lacs are justified and acceptable with a sub limit of Rs. 10 Lacs against book debts not older than 30 days.

Annexure – IIIZONE : Delhi - IIICompany : M/s Lalsons Enterprises

A. Security

Facility Primary Collateral Guarantees

Term Loan – IRs. 62.50 Lacs

Commercial Land at Major Dhyan Chadn Nagar, Main Delhi Raod, Meerut. Measuring 2724.17 sq. mtr. in the name of

1. Equitable Mortgage of Residential House situated at A-4, Jawahar Quarters, Begum Bridge Road, Meerut measuring around 306.85 Sq. Mrts. In the name of Sh. Yogesh Chandra valued Rs. 71.16 as per valuation report dated 21-02-2005.

2. Equitable Mortgage of Residential House situated

Personal guarantee of Smt. Sushma Chandra W/o Sh. Yogesh Chandra Net worth 66.60 Lacs as on 31-03-2005

Term Loan - II Rs. 30.00 Lacs

Term Loan – III Rs. 17.50 Lacs

CC(H) Rs. 20 Lacs with a sub limit of Rs. 10

Lacs against book debts

Sh. Yogesh Chandra S/o Late Sh. Nursing Bihari Lal R/o A-4, Jawahar Quarters, Kutchery Road, Meerut valued Rs. 127.00 Lacs

Building to be constructed for amounting to Rs. 50 Lacs at Major Dhyan Chand Nagar, Main Delhi Road, Meerut.

Security/Advance payment to RIL of Rs. 23.50 Lacs

Hypothecation of all kind of stock such as petrol, diesal, lubricants and other goods.

Hypothecation of all kind of book debts, receivables, claims etc.

at 94-E, Jawahar Quarters, Begum Bridge Road, Meerut measuring around 160.00 Sq. Mts. In the name of Sh. Yogesh Chandra. Valued Rs. 9.52 Lacs as pr valuation report dated 21-02-2005

3. Shop No. 15/6 at Part of Banglow 47/H1-New 20 Jawahar Quarters, Civil Lines, Meerut. Valued Rs. 4.05 Lacs as per valuation report dated 21-02-2005

4. Equitable mortgage of commercial property situated at Shop no. 16 part of Banglow 47/H-1, (Old) 20 New Jawahar Quarters, Meerut city in the name of Sh. Yogesh Chandra valued Rs. 3.96 lacs as per valuation report dated 21-02-2005

Deviation from existing security (if any);

New Proposal

B. ECGC cover : Not Available

C. Margins : (for each facility as applicable)

Cash credit Existing Proposed Raw material -Domestic -Imported SIP FG 25 % Receivables (cover 30 33.33% days) Letter of credit (Forign)

BG Term Loan Against Land 50%Against Building 40%Against Security/Advance payment 25%

Justification for deviation from existing margins, if any to be provided in the proposal under item 13.

The Central Bank of India has sanctioned a fund based limit of Rs. 95 Lacs which is in the Regional Manager and considered the margins 50% for building. While we have considered a reasonable margin of 40% against construction of building and 25 % margin for against security/advance payment RIL.

D. Rate of interest (Floating): 7.5% per annum on monthly rest as per circular no. dated

E. Repayment : 1. Term Loan 84 equated monthly installments of Rs. 1.70 Lacs started from April 2007

2. Working Capital Limit On Demand

F. Other critical covenants: Nil

Note: Any change in the terms and conditions should be justified in the proposal under item 13.

Annexure – DReview, based on audited financials, of credit limits earlier renewed / enhanced on the basis of provisional / un-audited data NOT APPLICABLE BEING A NEW UNIT

1. Zone/Credit App. Deptt./Commercial branch2. Branch : Meerut City3. Company Profile: M/S LALSONS ENTERPRISES

4. Date or renewal / enhancement:

5. Sanctioned by :

6. Financial arrangement : sole banking / consortium / multiple banking : Sole Banking

7. Credit limits

Limits SBP Others % share of SBPFund based-WC-TLTotal (FB)Non fund based-LCs (Import)-BGsTotal (NFB)Total (FB+NFB)

8. Performance / financial indicators(Figures in Lacs)

Prov./unaudited 31-03-2007

Actuals31-03-2008

Estimated31-03-2009

Projected31-03-2010

Net sales(exports)PBTPBT/N salesPATCash accrualsPUCTNW Half yearly perf. As on 30-09-2004TOL/TNW Prev.

yearCurr. year

Current Ratio

Net sales

TOL/Adj.TNW

PAT

9. Quality aspects

9.1 Any significant deviations observed from the provisional / un-audited data submitted earlier which may have impact on company’s credit worthiness.

N I L

9.2 Any adverse comments by the company’s auditors having impact on the company’s credit worthiness

N I L

9.3 Any adverse comments in the Credit Audit, I & A, Statutory Audit, RBI inspection subsequent to the renewal / enhancement.

NOT APPLICABLE.

9.4 Indications on achievement of the estimated performance as observed from quaterly/half yearly data.

NOT APPLICABLE.

9.5 Any change in the CRA rating /risk perception

10. Recommendations (To include any specific action considered necessary):

A) Term Laon 1. Term Loan against Land Rs. 62.50 Lacs

2.Term Loan against Building Rs. 30.00 Lacs 3.Term Loan for security to RIL Rs. 17.50 Lacs

(B) Working Capital LimitCC(H) Rs. 20.00 Lacs With a Sub Limit of Rs. 10.00 Lacs Against book debts not older than 30 days.

On the following additional terms & Conditions

Periodicity of Stock Statement : At monthly Intervals .

Inspection : As per bank norms

Insurance : Comprehensive for full value with agreed bank clause

Documents : As required by the bank

Period of Sanction : TERM LOAN FOR 7 YEARS WORKINF CAPITAL LIMITS FOR ONE YEAR

Processing Fee : As per Bank norms

Equitable Mortgage Charges : As per Bank norms

Other Stipulations:

1. The Term loan for construction of Petrol pump building should be disbursed in three stages. After completing the every stage the company will submit architect’s certificate for completing of work alongwith cost incurred for the same with provisional Balance Sheet duly verified by C.A. The branch shall make an inspection and after satisfying about the progress of construction and end use of the amount already disbursed, may disburse the installment for the subsequent stage of construction. The company shall also submit bills/receipts in taken of having incurred such expenses. After completion of the construction in final certificate form architech shall be obtained within 10 days for the due completion of work with the senior manager finance inspection report to this

effect. Inspection report of Senior Manager of the branch should be submitted before the disbursement of installment of the the term loan.

2. Book Debt finance will be granted only against Book Debts pertaining to first class parties.3. Drawings will be allowed only against paid-up stocks.4. The company will deal withus exclusively.5. Branch Manager will ensure, before release, to obtain legal opinion reports in respect of properties accepted as

collateral securities and will also ensure that valid equitable mortgage is created6. General Terms and conditions as applicable to such advances will also apply.

Date:Branch Head:

11. Controller’s directions

Controlling Authority

FORMAT “AS”

STATE BANK OF PATIALAMEERUT CITY BRANCH

Appraisal Note / Executive Summary / Control Report

( To be used as appraisal note for reviews, ad hoc limits, corporate loans, interchangeability, changes in security / margin and other matters. For corporate loan, repayment schedule and DSCR are to be furnished.)

ZONE : Delhi - III BRANCH : Meerut City

1. Company profile : M/s Lalsons Enterprises

Name : Lalsons Enterprises Constitution: Proprietorship Firm

Activity : Dealer for Reliance Outlet* by setting up a petrol pump at Major Dhyan Chand Nagar, Main Delhi Road, Meerut.

Banking with us since : Take over from Central Bank of India, Jail Chungi, Meerut.

Group, if any / promoter: Nil CEO : Sh. Yogesh Chandra

2. CRA:

Working Capital Term LoanExisting Proposed Existing Proposed

N.A. SB-I N.A. SB-1

2.2 Pricing : (Fixed/Floating) : As per circular no. dated

Working Capital Term LoanExisting Proposed Existing Proposed

--- --- --- ---

3. IRAC Status : Standard as on 30-06-20054. Date of last review/renewal : Not Applicable

5. Proposal : a) Fresh Term Loan and Cash Credit Facilities b) c)

Credit limits (existing & proposed) : Rs. In Lacs

Limits Existing Proposed ChangeSBP % CONS. SBP % CONS. SBP CONS

FBTotal FBWC Nil Nil Nil 20 100 Nil 20 NilTerm Loans Nil Nil Nil 110 Nil Nil 110 NilTotal FB Nil Nil Nil 130 100 Nil 130 NilLCs (import)

Nil Nil Nil Nil 100 Nil Nil Nil

BGs Nil Nil Nil Nil Nil Nil Nil NilDPGs Nil Nil Nil Nil Nil Nil Nil NilTotal NFB Nil Nil Nil 130 100 Nil 130 NilFB+NFB Nil Nil Nil 130 100 Nil 130 Nil

Note: 1. That the proposal have already been sanctioned by Central Bank of India , Jail Chungi Branch on 11-03-2005 as follows:

1. CC (Hyp. of Stock) Rs. 10 Lacs3. Term Loan Fresh

Against Land Rs. 62.50 LacsAgainst Building Rs.22.50 Lacs Rs. 85 Lacs

The Party have already been taken up a term loan of Rs. 62.50 Lacs against land and the party had purchased the land of Rs. 127 Lacs including stamp duty on 16-04-2005 and started his construction for building for setting up a Petrol Pump of Reliance Industries Ltd. in their supervision and direction.

3. We have canvassed the party to shift their proposal in our bank by offering the above credit facilities. Our AGM Sh. Alreja Ji has also visited the site and satisfied with the proposal and directed to go ahead.

6.2 The proposal falls within the powers of DGM because total credit facilities required 130 Lacs submitted for sanction.

7. Indebtedness/Exposure :(Rs. In lacs)

Indebtedness Existing as on 30-06-2005 ProposedFund based Nil 20Non fund based Nil 110Total (indebtedness) Nil 130Leasing Nil NilInvestments Nil NilTotal Exposure Limits Nil 130

8.Financial arrangement : (sole banking /consortium/multiple banking) : Sole Banking

Name of lead bank/Major BankWith their shares

9. Performance & financial indicators (Rs. In Lacs)

Projected31-03-2007

Projected31-03-2008

Projected31-03-2009

Projected31-03-2010

Net sales 1328.81 1395.25 1465.01 1538.26(exports)PBT 23.09 25.80 28.56 31.43PBT/N sales 1.74 1.85 1.95 2.04PAT 18.74 20.88 23.06 25.33Cash accruals 23.74 25.39 27.41 29.25PBDIT 38.61 40.16 41.71 43.32PUC 70.00 70.00 70.00 70.00TNW 87.54 106.92 128.49 152.02

Adjusted TNW 87.54 106.92 128.49 152.02TOL/TNW 1.97 1.50 1.14 0.86TOL/adjusted TNW 1.97 1.50 1.14 0.86Current ratio 2.06 2.16 2.27 2.38Net working capital 41.36 47.15 53.82 61.11Gross block 186.00 191.00 196.00 201.00Net block 179.80 178.80 177.95 177.23

IndustryExposure

- FB- NFB

DATA NOT AVAILABLE

Total number of units% of gross non food creditNPA in the exposure% age of NPA

10. Securityi) Primary

NatureSecurity margin

Existing ProposedWorking Capital Limit Hypothecation of all kind of stock such as petrol, diesal, lubricants and other goods.

Receivables (cover 30 days)Letter of credit (Import)

Term LoanAgainst Land Against Building Against Security/Advance Payment

25%

33.33 %

50%40%25%

ii) Collateral

Nature Existing ProposedValue Basis Value Basis

1.Equitable Mortgage of Residential House situated at A-4, Jawahar Quarters, Begum Bridge Road, Meerut measuring around 306.85 Sq. Mrts. In the name of Sh. Yogesh Chandra

71.16 Lacs Valuation Report 21-02-2005 and individual assessment of branch manager and field officer.

2. Equitable Mortgage of Residential House situated at 94-E, Jawahar Quarters, Begum Bridge Road, Meerut measuring around 160.00 Sq. Mts. In the name of Sh. Yogesh Chandra.

3. Shop No. 15/6 at Part of Banglow 47/H1-New 20 Jawahar Quarters, Civil Lines, Meerut.

4. Equitable mortgage

of commercial property situated at Shop no. 16 part of Banglow 47/H-1, (Old) 20 New Jawahar Quarters, Meerut city in the name of Sh. Yogesh Chandra

9.52 Lacs

a.L

3.96 Lacs

Valuation Report 21-02-2005 and individual assessment of branch manager and field officer.



Total Rs. 88.69 Lacs

i) Gurantee

Name Net means as on 31-03-20051. Personal Guarantee of

Smt. Sushma Chandra66.60 Lacs

Justification for change, if any, from the existing position: New Proposal

11. Salient features and justification for the proposal :

1. Term Loan



2. Working Capital

Keeping in view the holding level of stock as well as debtors. The firm has to invest heavy funds in working capital of the business and the firm has to maintained a level of stock for smooth running of our business. Therefore, we recommend a working capital limit of CC(H) Rs. 20.00 Lacs with a sub limit of 10 Lacs against book debts not older than 30 days.

12. a) compliance with regard to Loan policy guidelinesb) Earlier prescriptions of sanctioning authorityc) RMD exposure normsd) Figuring in RBI/ECGC defaulters list No

(We confirm that the Board approved Bank’s Policy regarding granting of facilities to the company has been strictly following and granting of facilities of M/s Lalsons Enterprises is acceptable to the Bank”

e) Major inspection/Audit irregularities : New Proposalf) Other risk factors : The implementation of WTO rules and Patents etc in

2007, can adversally effect the working of the Company.

g) Coming under any specific schemes like, Take-over, TUFS etc. : Noh) Obtention of legal compliance certificate : Nil

i) CIBIL clause : will be obtained

13. Recommended for sanction /approval/confirmation/submitted for control : (In case of control report, date of sanction and sanctioning authority to be indicated) :

1. Term Loan of Rs. 110 Lacs 2. Working Capital Limit Rs. 20 Lacs

14. HOCC conditions/observations, if any :

DY. General Manager GENERAL MANAGER (CB/OP)

Place :

Date :

DETAILS ABOUT ASSOCIATED CONCERNS/SUBSIDIARIES

Nil

ANNEXURE ‘A’

INDICATIVE CHECKLIST

- SSI Registration Certificate, where applicable.

- Partnership deed/trust deed/Registration Certification from the Registrar of Societies/certificate of

Incorporation/Memorandum and Articles of Association as the case may be.

- Certificate of commencement of business in the case of Public Limited Companies and Private Limited

Companies wholly owned by Public Limited Companies.

- Brief details of proprietor/Promoters/Directors viz.,

Full name, Father/Husband's name

Address (Residence & office ) with telephone No.

Academic qualification, Experience, Functional responsibilities in the unit, Capital/Loan contribution in the

unit. Other concern (s) with which he/she is associated, alongwith brief details: Management/ Organizational

structure.

- Key managerial and Technical Staff with their Qualification/Experience.

- Technical Consultants, if any.

- Copies of Licence, permission/ approval by Regulatory Authority, where applicable.

- Availability of utilities like Power, Water, Labour, Transport.

- Marketing arrangement; report of any study/survey conducted.

- Suppliers of machinery (copies of invoices), their reputation, experience in the field, Details of other major

users, any warranty available etc.

- Effluent disposal arrangement (permission for effluent disposal, where necessary)

- Pollution control arrangements (ISO Certificate).

- Project cost & means of finance with break-up.

- If some portion of the expenditure has already been incurred necessary proof (cash receipts).

- Schedule of implementation.

- Future projection

- Details of Technology employed, Manufacturing process

- If TL has been tied up with FI, details of the same with a copy of the sanction letter. Report from Merchant

Bankers, if capital market is being accessed.

- Production data

- Source and availability of raw material.

- Major players and market share.

- Any specific strategies, unique selling proposition, if any.

- Project report, CMA data

- Details of associate concerns with their borrowing arrangements.

- If it is a running unit

- Details of its existing borrowing arrangements

- Past performance – 3 years financial statements

- Details of major shareholders

- In case of switch-over from another Bank/FI reasons for the same

- Full details of collateral security offered, photo copies of the title deeds

- Personal guarantees along with full details of the guarantor and Assets & Liabilities statement with IT/Wealth

tax return.

- Details of pending litigations, if any, against and by the concern.

- In case of exports details of orders, raw material procurements etc.

- Legal/regulatory issues.

- Impact of WTO/Globalisation.

- Any special/crucial features of the industry; industry profile and its growth prospects.

- SWOT analysis by the borrower and mitigating measures for perceived threats/risks.