HEAD OFFICE

Technical Appraisal Dept

Star House. G5,'G'Bbck
BandraXuk Complex.
Bandra (East), Mumbai -400 051
Phone 6684632 FAX-ffi6846W30
headoff!ce.tad@bankofindia.co.in

Ref: HO:TAD:2013-14:279

Date : 21.01.2014

MISWebcon Consulting (India) Ltd.

Chattejee International Centre,
4'h Floor, 33-A J L Nehru Road,
Kolkata-700071, WB.
Dear Sir,
Renewal of vour empanelment on our Bank's approved panel
of Consultants for Techno Economic Appraisal.

We refer to your application received on 20.01.2014 through our Kolkata Zonal

Office, requesting for renewal of empanelment on our Bank's approved panel of TEV
Study consultants.
2.
We have considered your request favourably and are pleased to inform you that
we have renewed your name on our Bank's approved panel for the following:
Industry
ManufacturingIService

Tvpe of service
Technoeconomic viability study

Proiect Size
All

3.
The format in which study report is to be submitted and the minimum coverage
expected in the report shall be advised to you by our Zonal Office at the time of
assigning the job and the same will have to be meticulously followed by you while
executing assignment for our Bank.

.\

4.
Please note that services of consultants are availed only and only in case of
exigencies when bank's in-house services are not available. Hence being on the panel
of consultants of Bank of India, does not guarantee assignments during the period of
empanelment.
This empanelment is valid for a period of one year from the date of issue of this
5.
letter and needs to be renewed thereafter annually as prescribed.
6. Please note that Bank shall be within its right to initiate suitable action against you
in the event of any professional misconduct/ negligence etc. while handling the matter
entrusted to you, including by filing complaint with Institute of Chartered Accountants1
lnstitute of Engineers etc.

7.

Please acknowledge receipt of this letter.

Yours truly,

-14,

Kapila)
General Manager

-.

APPRAISAL FEE FOR EXTERNAL AGENCY

Wherever appraisal work is to:be referredto an external agl?ncy/ consultant, the

charges / terms of paymentetc of the agency / consultant will have to be negotiated by
the Bank before. hand and the concurrence of the proponent / borrower for bearing
such expenditure will have to be obtained in writing ( preferably the concerned amount
be got.deposited by the proponent in his deposit a m u n t with Bank's. lien marked on it).
Only thereafter an am'gnment shall be entrusted to an external agency / consultant.
negotiated with thereof will be as per the terms of approval by the appropriate
authoiii. Allowing the propqnents / borrowers to negotiate the fees with the agencies /
consultants should bedlscouraged. The scope of asslgnment for the external agency/
consultant should be advised by the Bank In writing. Report shoulj be obtained diredly
(not through the customer) and payment to the consultant should be made by ~anic.
TEV STUDY COVERAGE

SCCOPE OF WORK

TEVS report should normally cover the following aspects specifically, depending
upon the availability of inputs:

fi
ii)
-. .

iv)

v)
vi)
vii)

Promoters & their background only objective assessment of promowrs

and their background based on their experience, existing operations and
professional qualifications etc to be given. Relevance of these to the
proposedventure i n case of new units to be brought out.
Project cost & Means of finance
Financial analysis In case of exijtlng units with a view to ascertaining
~nvesbblesurplus, expected cash. accruals during the implementation of
the proposed new/expansion/diienification project. Other aspects to be
studied include inventory and receivable leve!s maintained- vis-a-vis
normative requlremenk and/or industry standards.
Plant and Machlnery : coyments on condition, t~alancingjadequacyof
existlng/proposed machinery, technological level, suppliers of machinery
etc should be given. I n case of second hand machinery, availability of
condition of
chartered engineer's certificate on age of nla;:hinery,
machinery, reasonabiilty.of cost, residual life and availability of spares etc
shoul'd also be seen and commented upon.
Infrastructure : availability of the required infrast'ucture, arrangements
made/proposed andadequacy thereof
Raw materials : required rawmateriais, quantitative requirements based
on yield data, sources of supply, cost of raw materiz~lsand their availability
position etc
Products: main p'roduct(s) to be.,manufactured, bye-products and wastes
etc. Quantitative projectlons (where avaiiable/possible) proposed selling
prices vis-a-vis current mar,ket'pricesetc

viii)

ix)
x)
xi)
xii)

Market & Marketing Arrangements : Demand supply data/position. Other

competitors in the industry, imported substitutes, targeted consumer
segment
.Assessment of Working capital requirements
Aswsment of Term Loan requlrement
SWOT analysis including risk factors and risk mitigants
Concluding comments on technical feasibility and economic' viability
including BEP analysis, DSCR calculations, ICR calculations and sensitivity
analysis on sles and major inputs. Debt sewicing capacity of the project
at different DSCR levels may be work.& out where the project DSCR is
lower than the benchmark flgure for the limits sought by the
proponentlbonower.

The above list is indicative only, the officer concerned would decide oncase to
case basis and based on the nature of the project, availability of inputs and purpose of
report (new finance or review or restructuring), as to which are the points to be
covered I not covered.
The purpose of T N Study is to aid the sanctioning authcrity to arrive at^ an
informed judgment as regards acc@ptabilltyof the project for lending ( or investment,$
purposes and to enable thls, the Technical Officer should, as clearly as possible, give a
conclusive view on t h e technical I commercial I financial aspects of t h e
project studied. Where the flaws noticed in the project are correctable, effort should
be made t o suggest ways and means In the TWS Report to make the project bankable.
Projects lnvolving technological hks will nave to be normally dealt w l h in the
venturedpital finance route. I n exceptional cases where such a project is. belng
contemplated by an erlsting borrower o f our Bank having adequate cash accruals, the
project (with technological risk) may be made banhble to the extent ofsurpius debt
sewiang capauty available from existing operations even though the viabliity aspect of
the project on stand alone basis would still remaln unestablished conclusively.
On the part of the recipient / user of the T N S Report, it is expected-'that a
thorough study of the report be made before arriving at a conclusior~on the viability of
the project instead of asingle point reference only to the final paragraph of the T N S
Report. While the concluding paragmph will certainly give an broad idea about. the
viability of the project, many subjective observations I assumptions leading to such
conciusion in the final paragraph are normally spread over, the report and may not
necessalily be summarlzed in the last paragraph to avoid repetitlon as also to keep the
concluding remark sufficiently brief.
T N S report shoul'd not cover aspects like the need for collateral security etc.
and other benefits to the bank, and the professional opinion expressed by the officer?
should. be purely on the project aspects, leaving other aspects'to the credit o*cers /
sanctioning authority to take administrative decision.

Annexure t o Branch Circular No. 9 9 / 1 0 dt. 20.04.2005

ANNEXURE A
INFORMATION TO BE SENT FOR TEVS
1. Project

Feasibility Report submitted by the proponents, in case

new/expansion/di.versification projects. The report should include the following:

of

Write-up Industrial License / SSI Registration/ FDA Approval and/or

any other licente/ permission required for manufacture of the proposed
products.
vii)
Memorandum & Artides of Aaoclation, Certificate of Incorporation and
Certificate of Commencement of Business where applicable
viii)
.Bio data of ,promoters including their background, qualifications,
exoerience, oresent occuoatlon. detalis of technical/Manaaerial ~ersonnel.
requiremen~avallabllityi f sldlled labour.
Cost of project & Means o f finance
ix)
Copies of registrationJapprovals/clearances (eg. Power sanction,
x)
Municipal corporation clearances for factory/buildin!j construction, NA
Permislon, pollution control authorities approval, etc.)
xi)
Details of land (location, area, price, site plan etc.)/ buildi,ng. .
plan/architect's estimate4 availability of infrastructure like roads,'
powerlwater, effluent disposal arrangements, etc. at the location. Total
powerlwater requirement and sources.
xii)
Details of plant and machinery (names of suppliers, cost, capacity,
power/fuel requirements, whether performance guarantee/back up
maintenance arrangements available>plant lay out
xiiif
Project
implementation
schedule;
,Arrangements
for
supervision/consultants, subcontracting i f any
xiv)
Details of the process rejebions/saap/bye products; arrangements for
process know how, techhical wllaboration/assistance; Buy back,
arrangements if any
Assumptions considered in profitabiiity projections, their basis and
supporting documents where available. Quantitative requirements of raw
material with Its sources, and prices. Opening/closing stocks of raw
materials/WIP/Finished Goods; production and sales both in terms of
quantity and value. Installed Qpacity, utiiisation envisaged, projected
financial statements including cost of production ant1 profitability, costing
'of each product, DSCR calculations. Projected Balance Sheets and Funds
Flow statement
xvi)
Detalled calculations~forexcise duty, depreciation, interest and taxes.
xvii)
Market survey Report where available for the product .Wstlng /
projected demand and supply position. Competitors, their locations,
instatled capaaties, selling prices, market share, etc.
Product
specifications, uses, standards applicable, market segments targeted, etc.
List of proposed customers/whether tie ups madf/terrns of payment,
pending orders on hand.
vi)

2. Application in relevant formats with CMA data wherever applicable.

3. I n .case of existing borrowers where no new/expansion/diversification project is
being considered, a copy of last sanctioned proposal may be pravided.
4. Profitability / balance sheet /cash flow projections submitted by the existing
borrowers along with working notes (working notes to indude assumptions
considered in profitability projections, their basis and supporting documentswhere
.
available; quantitative requirements of raw material with its sources and prices; -i
opening/ciosing stocks of raw materials/WIP/Finished Good:, - both in terms of 4
quantity and value; production and sales both in'terms of quantity and value.
Installed capacity, utilisation envisaged, projected financial stalzments including cost
of production and profitability, costing of each product, DSCR calculations)

5. Names of group concerns with their activity and copies of latest balance sheets etc.
6. Balance sheetlrelated P/L account for last 3 years and up to date performance
details for the current year in case' of existlng companieslfinns. Quantitative details
of production, raw material consumption, opening stock (raw material, work inprocess & finished goods), closlng stocks (raw materlal, work in-process & finished
goods), sales to be provided where these details: are not given in the balance
sheets. Copies of tdx audit reparts to be provided alongwith balance sheets.
'
7. PoslUon of account (existing accounts)
8. Brief history, reasons for sickness, rehabiiltdtion packagelpian submlttedlproposed;
rellefs/concesslons sought (In &e of sick units)

Supporting documents for project report indude the following: a) market survey report
of reference to such report; b) Supporting documents including quotaUons/lnvolces
andlor estimates to support the cost of various heads of the project cost; c) price data
on raw rnaterialslfinished goods indudlng latest Invoices/quotations.