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    Question

    A project has annual cash accruals of ₹18 crore.

    Annual term loan obligation (principal + interest) is ₹12 crore. What is the DSCR and its interpretation?
    A 1.2 – Just adequate Correct Answer Incorrect Answer
    B 1.5 – Comfortable Correct Answer Incorrect Answer
    C 1.0 – Break even Correct Answer Incorrect Answer
    D 0.8 – Inadequate Correct Answer Incorrect Answer
    E 2.0 – Excellent Correct Answer Incorrect Answer

    Solution

    DSCR = Cash Accrual / Debt Obligation = 18 / 12 = 1.5 Above 1.33 is generally comfortable.

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