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Capex
Term Loans for Machinery & Infrastructure: What Banks Actually Look For
Feb 3, 20266 min read
Capacity expansion is a sign of confidence, but a term loan file passes credit committee only when projected cash flows can service the EMI under stress.
Term loans for machinery and infrastructure get sanctioned on three things: a credible source of repayment, a clean security cover, and a sensible promoter contribution. Most rejections we see come from optimistic projections that lenders cannot underwrite. The work is to model the business honestly, layer in sensitivity analysis, and present a debt service coverage ratio that holds up even when one variable moves the wrong way.
