CIN : U45309KL1961SGC001937

Project Lending

KSIDC offers financial assistance and support to medium and large scale industries in the State including service sectors like tourism, star category hotels, resorts, hospitals, infrastructure projects, etc and where the constitution of assisted unit is in the nature of Private/ Public Ltd Company.

Normally financial assistance is available for projects with an investment of Rs. 200 Lakh and above. KSIDC’s term loan assistance is limited upto a maximum of Rs. 3500 Lakh in a project and it can go up further for single project prior permission from State Government. The definition of the medium and large scale manufacturing industries, defined by the Central Government is applicable to KSIDC also.

The standard norms for financial assistance of the projects:

Debt Equity Ratio a. 1:1 up to 1.5:1 for new companies with minimum/no track record.
b. 1.5:1 up to 2:1 for expansion of good assisted units & other good non-assisted units.
Term Loans Up to Rs. 35 Crore can be sanctioned. No cap for term loan under direct financing. However loan exceeding Rs. 35 Crore is subject to approval by State Govt. The minimum amount considered for assistance is Rs.1 Crore except in case of expansion proposals of assisted units, where the minimum limit would be Rs. 50 lakhs.
Short Term Loan May be considered for assisted units on a selective basis.
Repayment Repayment period is 6-8 years with a moratorium of 2-3 years, on a selective basis.
Interest Rate Based on a sliding scale with interest band ranging from 11.00 - 13.00%. Further, a further reduction of maximum up to 1% will be granted at the end of every financial year by reversal of the interest charged, provided there are no arrears of interest as on 31st March of the relevant particular year. The reduction in interest as above shall be calculated on the outstanding principal alone and there shall be no reversal of penal interest portion.
Working capital term loan May be considered for units with good performance track record. For the purposes of determining good performance track record, the following parameters are considered.
  1. The company has made cash profits during the preceding five years
  2. The company has made net profits during the preceding three years
  3. There are no overdues to financial institutions/ banks and
  4. There has been turnover growth during the previous three years.

The project should be financially and technically viable with satisfactory financial indices like Internal Rate of Return (IRR), Debt Service Coverage Ratio (DSCR), pay back period etc, and the promoter directors should execute personal guarantees with the Corporation for the timely repayment of the financial assistance sought.

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