APPENDIX A TRADING SECTOR : SIMPLIFIED MODEL BORROWER RATING SUMMARY Financial Risk (FR) Weight Maximum Company’s (A) Weighted Weighted Score Score (a) (a) x(b) Parameters (b) (d) ( c ) TOL/ TNW (i) 10 2 20 Current Ratio (ii) 10 2 20 Return on Capital Employed (iii) (ROCE) (%) 10 1 10 (iv) 10 1 10 PAT/Operating income (v) 10 1 10 (a) Gross Average DSCR (for TL) or (b) Inventory/Net Sales + Receivables/Gross Sales 10 2 20 (Days) (WC) – (vi) or (c) [ Sum of Scores under (A+B)]/2 (for a company enjoying both WC & TL facilities) (vii) Group Risk 10 0.5 5 (vii) Collateral Security 10 2 20 (viii) Forex Risk 10 0.5 5 Total Score (Annexure A1) 120 Total Score normalised to 120/2=60 60 (Existing Unit) Total Score normalised to 120/4=30 30 (New Unit) Qualitative Factors (-ve)- (-10) 1 (-10) (Annexure A2) Score (FR) 60
APPENDIX A TRADING SECTOR : SIMPLIFIED MODEL BORROWER RATING SUMMARY (A) Financial Risk (FR) (a) Weight (b) Maximum Weighted Score (a) x(b) ( c ) Company’s Weighted Score (d) Parameters (i) TOL/ TNW 10 2 20 (ii) Current Ratio 10 2 20 (iii) Return on Capital Employed (ROCE) (%) 10 1 10 (iv) 10 1 10 (v) PAT/Operating income 10 1 10 (vi) (a) Gross Average DSCR (for TL) or (b) Inventory/Net Sales + Receivables/Gross Sales (Days) – (WC) or (c) [ Sum of Scores under (A+B)]/2 (for a company enjoying both WC & TL facilities) 10 2 20 (vii) Group Risk 10 0.5 5 (vii) Collateral Security 10 2 20 (viii) Forex Risk 10 0.5 5 Total Score (Annexure A1) 120 Total Score normalised to 60 (Existing Unit) 120/2=60 Total Score normalised to 30 (New Unit) 120/4=30 Qualitative Factors (-ve)- (Annexure A2) (-10) 1 (-10) Score (FR) 60
Credit-Risk-Assessment-model-for-Rating-Credit-Proposal.docx