Project Finance — DPR & Techno-Economic Study

Companies Act, 2013: Section 180(1)(c) requires the board of directors of a company to obtain shareholder approval by special resolution before borrowing money — including for project finance — where the aggregate of monies already borrowed together with the proposed borrowing exceeds the company's paid-up share capital, free reserves, and securities premium. This threshold is commonly crossed by project finance and infrastructure borrowers once a project's debt component is sized against the DPR (Detailed Project Report) and techno-economic feasibility study prepared for lender appraisal, since project debt is typically structured as a multiple of promoter equity/free reserves rather than being bounded by them. Once passed, the special resolution must be filed with the Registrar of Companies in Form MGT-14 within 30 days of being passed. A DPR/techno-economic study prepared for a lender or financial institution should flag, as part of the appraisal package, whether the proposed debt draws the borrowing company's board past this Section 180(1)(c) threshold, so that the special resolution and MGT-14 filing are sequenced ahead of, or alongside, financial closure rather than discovered as a late-stage compliance gap.

Project finance DPR preparation is the building of the Detailed Project Report that banks and financial institutions require before financing a project — the project's technical and the financial feasibility, the market and the demand, the project cost and the means of finance, the financial projections, the sensitivity and the risk analysis, and the implementation plan. The DPR is the document the lender reads to decide the loan, and its quality decides the sanction and the terms.

The DPR is the project's business case in one document — the technical design and the capacity, the market and the revenue, the project cost broken into the components, the debt-equity and the means of finance, the projected financials with the debt service capacity, and the risks and the sensitivities. The lender's credit team tests each part, and the DPR that hangs together is the DPR that gets sanctioned on the better terms.

The cost of a weak DPR is the loan that is delayed, reduced or refused: the project cost understated and the funding gap, the projections that the lender's analyst does not trust, the sensitivities that expose the project. The DPR is the cheapest work in the project and the most consequential.

This service is for project promoters preparing for the finance. We build the DPR — the project description and the market, the technical and the financial feasibility, the project cost and the means of finance, the financial projections and the debt service, the sensitivity and the risk analysis, and the implementation plan — in the format the lenders expect, so the project is financed on the numbers it deserves.