D.p.

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nikhil

nikhil (Querist)
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11 September 2012 how drawing power is calulated

Ahamed

Ahamed (Expert)
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11 September 2012 Drawing Power calculation is illustrated below.

Example:

If a Company opts for 20 Crore Loan based on 15 cr for stock & 5 Crore for Debtors.

the Bank will set up a margin like 25% on stock and 40% on debtors..

The Book Balance of the company shows that 20 cr of stocks and 10 cr of debtors then the DP Will be consider like this

Stock 20 cr
Less: Margin @ 25 % 05 cr

Then DP for stock value is 15 Cr

like that after deducting the margin the balance will be consider for DP.