My project at sbh

CONTENTSChapter No. Table of Contents Page No.

1

Executive Summary Objectives Scope Limitation Assumptions

2

Profile of the firm

3

Research Methodology Method of Data Collection Primary Data Secondary Data Loan Proposal Marketing Analysis

4

Investment Cost of Project Capital Structure Working Capital Total Annual Expenditure Revenue for The Projected Period Repayment of loan Schedule For Depreciation Income statement Cash Flow Statement Balance Sheet Ratio Analysis

5 Conclusion & Bibliography

1

CHAPTER 1

EXECUTIVE SUMMARYOBJECTIVESCOPEVISIONLIMITATIONASSUMTIONS

2

Executive Summary

3

OBJECTIVES:

To get information of loans taken from banks and other financial companies.

The experience of both numerical and practical use of financial statements.

For future financial need forecasting and planning, so from the following project we will know all the usage from financial, statements banks loans and terms related to finance.

We will know all the financial polices. Loans taken rules and regulations and usages ratios.

To get knowledge about the rules and regulation of government with related project study.

To get knowledge about the specialized subject.

Interpretation of a corporate loan proposal with reference to a case study.

4

SCOPE:

To learn financial terms, installment procedures of banks loans repayments, income statement, profit and loss account, balance sheet and cash flow statement.

The study of the project includes information which is useful in financial management and human resources management.

The study can also helpful with focused on data collection of both primary and secondary data in procedure.

As our project is related to finance field, the study will mostly useful to support our financial working.

The study also flows also on the project preparation techniques and also data collection techniques.

So, finally we can say that study of project related to financial management which provides financial statement for the projected period of 5 years.

5

LIMITATION:

The original profit and other expenses , gains and losses are higher or lower

than that of projected projection.

Errors can be done while preparing projected balance sheet and other

financial statements and also when calculations are made.

It is not possible to get exactly desired result by the business firms while

projecting future objectives and goals thus perfection is not possible.

Everything is based on estimations hence the results are approximate.

6

ASSUMPTIONS:

This project has been made on the basis of data that has been received directly from sources & indirectly from books and internet.

The accuracy of this data cannot be measured and so the main assumption here is that the data provided is 100% true.

The Rate of Interest at the time of starting the research was found to be 14.5%, but this value could have changed with the new financial policies and economic growth.

The points have been rounded off whenever and wherever necessary to make calculations easier.

7

CHAPTER II

BANK PROFILE AND INTRODUCTION

8

BANK PROFILE

Name of Organization : State bank of hyderabad

Contact Info :

Website : www.sbhyd.com

Year of Establisment : 8 Aug 1941

Address : Lane-C, Main Road, Ambedkar Chowk

Sillod - 431112, Dist. Aurangabad Maharashtra.

9

10

CHAPTER III

Research Methodology

Primary Data

Secondary Data

Loan Proposal

11

RESEARCH METHODLOGY:

Research can be defined as logical and systematized application of the

fundamentals of science to the general and overall questions of a study and

scientific techniques which provide precise tools ,specific procedures and technical

rather than philosophical means for getting and ordering the data prior to their

logical and manipulation. In other words, research refers to any original and

systematic investigation undertaken in order to increase knowledge and to establish

facts and principles .It is an organized and systematic activity and may lead to new

and improved insights, development of new products and processes.

Research is the process which includes defining and refining problems,

formulating hypothesis or suggested solutions; collecting, organizing and

evaluating data; making deductions and reaching conclusions, and at last, carefully

testing the conclusion to determine whether they fit the formulating hypothesis.

12

Method of Data collection:

The information for this project has been collected through primary and

secondary sources:-

Primary Data:

Firstly we collected data by visiting STATE BANK OF HYDERABAD and meeting delegates and interviewing about the entire process of obtaining loan.

We also had a detailed interview with the manager about their loan procedure as well as different schemes.

Secondary Method:

The secondary data were collected from the brochure of the bank, the boards with the information displayed in the bank premises and, from the bank website.

In short we can say that we got the secondary data from the following sources :

Internet.

Books.

Bank profile.

LOAN PROPOSAL:

Detailed report (based on the potential borrowers, loan application and credit

worthiness), presented usually by a banks officer (with his or her comments) to a

senior loan officer or the banks’ loan committee.

13

HOW TO MAKE A LOAN PROPOSAL

STEP-1

Submit a cover letter with your proposal. This should be a brief introduction to

your company, the size of the loan requested and the purpose of the loan.

STEP-2

Begin your proposal with general information, including the company name and

address, names and social security number of the principals, the purpose of the

loan, the exact amount of money needed and detailed plants for what will be done

with money.

STEP-3

Describe your business in detail. Include information on prior and projected

performance, unique aspects of your business and the legal and ownership

structures.

STEP-4

Provide complete market information. Identify your competition and explain how

your business stacks up. Submit details on your current customer base.

STEP-5

Prepare management profiles for all owners and key employees. Highlight their

education, past accomplishments and qualifications.

14

STEP-6

Submit complete information concerning your last 5 years of operation. If you’re

just starting out, provide projected balance sheets and income statements. Also

include personal financial statements from all the owners and information on any

collateral that will be placed as security for the loan.

STEP-7

Proofread the document; double checking spelling, rammer and the facts contained

in the proposal.

STEP-8

Submit your proposal with each copy of the loan package you’re required to return.

Remember to keep a copy for yourself.

15

DOCUMENTS REQUIRED FOR LOAN PROPOSAL

Submit shop act license.

Submit three years estimated balance sheet.

Submit three years income tax challan.

Submit KYC (Know Your Customer) documents- ration card, election ID, PAN card, photos, light bill.

Person must be a shareholder.

Submit property guarantee (house valuation, tax receipt).

16

CHAPTER :4

FINANCIAL STATEMENTS

17

INVESTMENT COST OF THE PROJECT:

Serial Particulars Amount AmountA Equipment Cost:

Leg Press 65000Leg Extension 70000Standing Calf 60000Leg Curl 70000Low Cable Row 65000Lat Pull Down 71000Cable Cross over 75000Back Extension 25000Decline Bench 28000Adjustable Bench 22000Dumble 58000Plates Weight 30000Trade Mills 25000Elliptical Trainer 110000Cycles 62000Steam Bath 72000Cabins 12000Peek Deck Fly 65000Power cage 58000Mirror 87500

1130500B FURNITURE

Sofa Sets 10000Computer Table 80000

1148500C License 6000 1154500D Computers & Printers 26000 1180500E Working Capital 115000F Total Cost of project 1295500

18

CAPITAL STRUCTURE:

Serial Particular Amount

A LOAN FROM BANK 906850

B OWN CONTRIBUTION 388650

TOTAL COST 1295500

19

NOTES:

The cost of the equipment has been taken from an absolute fitness gym.

The cost of furniture and fixture has been taken on the basis of research and

discussion with experts.

The currency unit of the project has been taken in INR.

20

WORKING CAPITAL:

Particulars amount

Receptionist 6000

4*6000 24000

Electricity bills 12000

fuel charges 2000

Rent 34000

repairs and maintances 5000

marketing and advertisement p.a 9000

lightening fitting 23000

Total working capital 115000

21

TOTAL ANNUAL EXPENDITURE DURING

PROJECTED YEAR:

Particulars year 1 year 2 year 3 year 4 year 5

Receptionist 72000 72000 72000 72000 84000

Trainers 288000 360000 432000 504000 576000

Electricity 12000 13000 14500 14500 15000

fuel charges 24000 20000 22000 5311 7000

Rent 408000 420000 432000 432000 432000

repairs and maintenance 60000 24000 30000 35000 20000

marketing

&advertisement

9000 8000 7500 5000 6000

lighting fitting 23000 0 15000 0 15000

Total 896000 917000 1025000 1067811 1155000

22

Notes:

Trainers and salaries of trainers will increase in second by add one additional trainers and salary increase by 10%.

Electricity bills increasing 1500 every year.

Marketing and Advertising increase by Rs.500 and respectively.

Lighting and Fitting will increase as in third year and fifth year we have 2 new air conditions and fans to give a good temperature to gym area.

Fuel charges decrease and increase with related situation.

Rent increase by Rs. 1000 every year as per agreement.

Repair and maintenance increasing due related condition.

Revenue for projected period:

We have three plans for our customers to join the club

One year plan = Rs.10000

Six month plan = Rs.5000

Three months plan =Rs. 2500

23

Revenue for the first year:

Starting of business: One year plan - 40 customers 10000*40=40000

Starting of business: Six months plan - 60 customers 5000*60*2=600000

Starting of business: Three month plan - 70 customers 2500*70*4=700000

For other customers we have one month plan for one year = 30000

Total revenue for the first year = 1730000

Due to the growing business the customers will also increase and will effect on revenue according to the years.

24

Revenue for second year:

Starting of business: one year plan - 45 customers

10300*45=463500


5300*65*2=689000

three months plan is starting of business we have 75 customers

2700*75*4= 8100000


Total revenue for Second year = 2022500


25

Revenue for third year:


10300*50=515000

Starting of business: six months plan - 70 customers

5300*70*2=742000

Starting of business: three month plan - 80 customers

2700*80*4=864000


Total revenue for the third year=2181000


26

Revenue for fourth year:

Starting of business : one year plan - 55 customers10300*55=566500

Starting of business : six months plan - 75 customers5300*75*2=795000

Starting of business : three months plan - 88 customers2700*88*4=950400


Total revenue for fourth year= 2371900


27

Revenue for fifth year:

One year plan is starting of business we have 60 customers

10300*60=618000

Six month plan is starting of business we have75 customers

5300*75*2=795000

Three months plan is starting of business we have 95 customers

2700*95*4=1026000


Total revenue for fifth year= 2499000


28

Revenue schedule for five years:

Year Year 1 Year 2 Year 3 Year 4 Year 5Amount 1730000 2022500 2181000 2499000 10804400

29

What is EMI ?

Equated Monthly Installment – EMI for short – is the amount payable every month to the bank or any other financial institution until the loan amount is fully paid off. It consists of the interest on loan as well as part of the principal amount to be repaid. The sum of principal amount and interest is divided by the tenure, i.e., number of months, in which the loan has to be repaid. This amount has to be repaid monthly. The interest component of the EMI would be larger in the initial months and gradually reduce when compared to the principal amount. The exact percentage allocated towards payment of the principal depends on the interest rate. Even though your monthly EMI payment won’t change, the proportion of principal and interest components will change with time. With each successive payment, you’ll pay more towards the principal and less in interest.

Here’s the formula to calculate EMI:

Where,

E is EMI

P is Principal Loan Amount

r is rate of interest calculated on monthly basis. (i.e., r = Rate of Annual interest/12/100. If rate of interest is 10.5% per annum, then r = 10.5/12/100=0.00875)

n is loan term / tenure / duration in number of months

30

Calculation of interest and installment of bank loan for first year:

Month Monthly Installment

Interest Principal Balance

0 9068501 21336.62 10957.77 10378.85 896471.12 21336.62 10832.36 10504.26 885966.93 21336.62 10705.43 10631.19 875335.74 21336.62 10576.97 10759.65 864576.15 21336.62 10446.96 10889.66 853686.46 21336.62 10315.38 11021.24 842665.17 21336.62 10182.2 11154.42 831510.78 21336.62 10047.42 11289.2 820221.59 21336.62 9911.01 11425.61 808795.910 21336.62 9772.951 11563.67 797232.211 21336.62 9633.223 11703.4 785528.812 21336.62 9491.807 11844.81 773684Total 256039.5 122873.5 133166

31

Calculation of interest and installment of bank loan for second year:



13 21336.62 9348.682 11987.94 761696.114 21336.62 9203.828 12132.79 749563.315 21336.62 9057.223 12279.4 737283.916 21336.62 8908.847 12427.77 724856.117 21336.62 8758.678 12577.94 712278.218 21336.62 8606.695 12729.93 699548.319 21336.62 8452.875 12883.75 686664.520 21336.62 8297.196 13039.43 673625.121 21336.62 8139.636 13196.99 660428.122 21336.62 7980.173 13356.45 647071.623 21336.62 7818.782 13517.84 633553.824 21336.62 7655.442 13681.18 619872.6Total 256039.5 102228.1 153811.4

32

Calculation of interest and installment of bank loan for third year:



25 21336.62 7490.128 13846.49 606026.126 21336.62 7322.816 14013.81 592012.327 21336.62 7153.482 14183.14 577829.228 21336.62 6982.103 14354.52 563474.729 21336.62 6808.652 14527.97 548946.730 21336.62 6633.106 14703.52 534243.231 21336.62 6455.438 14881.18 51936232 21336.62 6275.624 15061 50430133 21336.62 6093.637 15242.98 48905834 21336.62 5909.451 15427.17 473630.835 21336.62 5723.039 15613.58 458017.336 21336.62 5534.375 15802.25 442215Total 256039.5 78381.85 177657.6

33

Calculation of interest and installment of bank loan for fourth year:



37 21336.62 5343.431 15993.19 426221.838 21336.62 5150.18 16186.44 410035.439 21336.62 4954.594 16382.03 393653.440 21336.62 4756.645 16579.98 377073.441 21336.62 4556.303 16780.32 360293.142 21336.62 4353.541 16983.08 34331043 21336.62 4148.329 17188.29 326121.744 21336.62 3940.637 17395.98 308725.745 21336.62 3730.436 17606.19 291119.546 21336.62 3517.694 17818.93 273300.647 21336.62 3302.382 18034.24 255266.448 21336.62 3084.468 18252.15 237014.2Total 256039.5 50838.64 205200.8

34

Calculation of interest and installment of bank loan for fifth year:



49 21336.62 2863.922 18472.7 218541.550 21336.62 2640.71 18695.91 199845.651 21336.62 2414.801 18921.82 180923.852 21336.62 2186.162 19150.46 161773.353 21336.62 1954.761 19381.86 142391.454 21336.62 1720.563 19616.06 122775.455 21336.62 1483.536 19853.09 102922.356 21336.62 1243.644 20092.98 82829.3357 21336.62 1000.854 20335.77 62493.5658 21336.62 755.1305 20581.49 41912.0759 21336.62 506.4375 20830.18 21081.8860 21336.62 254.7394 21081.88 0Total 256039.5 19025.26 237014.2

35

SCHEDULE FOR DEPRICIATION:

Depreciation schedule on equipment’s:

Year Opening balance

Rate %

Depreciation Closing balance

1 1130500 10% 113050 1017452 101745 10% 10174 915703 91570 10% 9157 824134 82413 10% 8241 741715 74171 10% 7417 66753

Depreciation schedule on furniture:


Rate %


1 18000 10% 1800 162002 16200 10% 1620 145803 14580 10% 1458 131224 13122 10% 1312 118095 11809 10% 1180 10628

Depreciation on computers and printers:


Rate %


1 26000 50% 13000 130002 13000 50% 6500 65003 6500 50% 3250 32504 3250 50% 1625 1625

36

5 1625 50% 812 812

Income statement, Profit & Loss A/c:

Particulars year 1 2 3 4 5Revenue From the Project 1730000 2022500 2181000 2371900 2499000Less Expenses 896000 917000 1025000 1067811 1155000PBDIT 834000 1105500 1156000 1304089 1344000less Depreciation 127850 18294 13865 11178 9409Less Interest 1,22,873 1,02,228 78,382 50,839 19,025Less Preliminary Expenses 3879 3879 4000 4000 4000

PBT 5,79,398 9,81,09910,59,75

312,38,07

213,11,56

6Less TAX @ 30% 1,73,819 2,94,330 3,17,926 3,71,422 3,93,470Net Profit 4,05,578 6,86,769 7,41,827 8,66,651 9,18,096

37

Cash flow statement:

Particulars year 1 2 3 4 5Op balance 0 5,13,141 10,68,272 16,50,306 22,75,245Revenue 17,30,000 20,22,500 21,81,000 23,71,900 24,99,000Own Capital 3,88,650bank Loan 9,06,850Total 3025500 2535641.181 3249271.927 4022206.404 4774245.115

Less: Cash OutflowFixed Assets 11,80,500Instalments 2,56,040 2,56,040 2,56,040 2,56,040 2,56,040Tax paid 1,73,819 2,94,330 3,17,926 3,71,422 3,93,470op Exp 8,96,000 9,17,000 10,25,000 11,19,500 11,55,000Reg Charge 6,000Total 25,12,359 14,67,369 15,98,966 17,46,961 18,04,509Closing Balance 5,13,141 10,68,272 16,50,306 22,75,245 29,69,736

38

Balance Sheet:

Particulars year 1 2 3 4 5

Own Capital 3,88,650 5,97,06710,83,37

418,31,60

827,00,60

4Bank Loan 9,06,850 7,61,696 6,06,026 4,26,221 2,18,541Net Profit 4,05,578 6,86,769 7,41,827 8,66,651 9,18,096

Total 17,01,07820,45,53

224,31,22

731,24,48

038,37,24

1

AssetsFixed Assets 1180500 824545 810680 799502 790093Current Assets 0 0 0 0 0

Cash In hand 5,14,57812,20,98

716,20,54

723,24,97

830,47,14

8Registration Charges 6000 0 0 0 0

Total 17,01,07820,45,53

224,31,22

731,24,48

038,37,24

1

Difference 0 0 0 0 0

39

Ratio analysis:

Net profit ratio:

Net profit ratio = net profit/net sales*100


Sales 17,30,00020,22,50

0 7,48,234 8,68,856 9,19,802

Net profit 4,05,578 6,86,76921,81,00

023,71,00

024,99,00

0Ratio 0.23 0.34 2.91 2.73 2.72

40

Debt equity ratio:

Debt equity ratio = long term debt/ proprietor’s fund

Debt 9,06,850 7,61,696 6,06,026 4,26,221 2,18,541

Own Fund 3,88,650 5,97,06710,83,37

418,31,60

827,00,60

4Ratio 2.33 1.28 0.56 0.23 0.08

41

DSCR ratio = net profit after tax+depreciation+interest/interest+installment

PAT 4,05,578 6,86,769 7,41,827 8,66,651 9,18,096Depreciation 1,27,850 18,294 13,865 11,178 9,409Interest 1,22,873 1,02,228 78,382 50,839 19,025Total 6,56,302 8,07,291 8,34,074 9,28,667 9,46,530

Interest 1,22,873 1,02,228 78,382 50,839 19,025Installment 2,56,040 2,56,040 2,56,040 2,56,040 2,56,040Total 3,78,913 3,58,268 3,34,421 3,06,878 2,75,065

Ratio 1.73 2.25 2.49 3.03 3.44

42

Debt service coverage ratio:

Debt service coverage ratio=PBID/annual repayment


PBID8,34,00

011,05,50

011,56,00

013,04,08

913,44,00

0Repayment Of loan

2,56,040 2,56,040 2,56,040 2,56,040 2,56,040

Ratio 3.26 4.32 4.51 5.09 5.25

43

CHAPTER : 5

CONCLUSION AND BIBLIOGRAPHY

44

CONCLUSION:

45

BIBLIOGRAPHY:

1. Financial statements are based on assumption given earlier:I. Initial sources and application of fund

II. Profitability statementIII. Cash flow statementIV. Balance sheetV. Depreciation

VI. Repayment of loan

2. Websites:

www.google.comwww.fitness-world.comwww.sbhyd.comwww.onlinesbh.com

46

http://www.onlinesbh.com/

http://www.sbhyd.com/

http://www.fitness-world.com/

http://www.google.com/

Education

My project at sbh