The company involved in this transaction has been undertaking civil and electrical engineering work for the Ministry of Defense (MOD) since 2005. The company is registered with Defense Research and Development Organization (DRDO), under CIV-IV and ED-IV category, which allows it to undertake civil and electrical projects awarded by the organization. Apart from that, the company is also registered as an SS class contractor with Military Engineering Services (MES).
Prior to associating with Coinmen, the group had a banking arrangement with a set of PSUs and private lenders with NFB facilities to the tune of INR 2000 million, with collateral ranging between 75-150% between lenders.
However, since substantial collateral was blocked with lenders, the company’s growth was getting stalled due to limited credit lines. Further, a few member banks came under the PCA framework, which made it difficult for the company to use sanctioned facilities from these lenders.
The goal was to rightly appraise the company’s requirements in short term as well as medium term. Also, it comprised of assessing available securities vis-à-vis requirements and then re-engineering the limits.