Question

term loan installment is rupees 10000 per month monthly average installment on term loan is rupees 5000 depreciation is rupees 30000 per month and PAT 270000 what will be the DSCR

Answer 1

Total Term loan installment = 10000
Yearly = 10000 × 12 = 120000

Monthly Average = 5000
Yearly = 5000 × 12 = 60000

Debt Service Coverage Ratio

= Earnings available for Debt services / (interest + installments)

Earnings available for Debt services:-

=Profit After Tax (PAT) + Non Cash items etc..
=270000 + 30000
=300000

=> 300000 / ( 120000 + 60000)
=> 300000 / 180000
=> 1.6