SME Cluster Series 2014 - Delhi
  

Dun & Bradstreet - British Airways SME Cluster Series 2014 : Delhi

 

Section A: Engineering Industry

In this chapter, we discuss the survey results with respect to funding scenario in the Ahmedabad cluster (for instance, procurement of funds, sources of funds and difficulties in obtaining finance).

Funding scenario

The survey conducted by D&B among the engineering companies in the Ahmedabad cluster revealed that 36% of the firms have taken loans in the past three years. Nearly 67% of the companies which had not taken loans in the past three years lie in the turnover bracket of less than ` 5 mn. The survey also revealed that about 31% of the respondents foresee need to take loans during the next three years.

Procuring funds

The survey revealed that most of the respondent companies find it easy to procure funds for their financing requirements. Nearly 71% of the respondents confirmed the same. About 14% of them find it moderately easy to procure funds for their financing requirement, while only 4% of the respondent companies find it difficult to procure funds for their financing needs.

Nearly 60% of the respondent companies in the Ahmedabad cluster procure finance from nationalised/public sector banks. Another substantial 35% of the remaining respondents procure finance from private banks.

Obstacles faced in obtaining credit

According to the survey, majority of the companies did not face any obstacles in obtaining credit. Although, about 10% of the companies indicated paperwork to be a moderate obstacle. Collateral requirements, interest rates and access to long term loans were the least obstacles faced by the companies while obtaining credit. About 44% of the respondents attributed access to short term loans and time taken for loan approval as minor obstacles in obtaining credit.

Section B: Pharmaceutical Industry

In this chapter, we discuss the survey results with respect to the funding scenario in the Ahmedabad cluster (for instance, procurement of funds, sources of funds and difficulties in obtaining finance).

Procuring funds

The survey conducted by D&B among the pharma companies in Ahmedabad cluster revealed that most of the respondent companies find it moderately easy to procure funds for their financing requirements, with nearly 37% of them confirming the same. Interestingly, only around 27% of the respondent companies find it very easy to procure funds for their financing requirement and only 18% of the respondent companies find it difficult to procure funds for their financing needs.

Almost half of the respondents companies in the Ahmedabad cluster procures finance from public sector banks. Interestingly only 10% of the respondent companies procure finance from MNC/foreign banks and co-operative banks. As much as half of the companies which indicated that they have moderate access to funds prefer availing loans from public sector banks only.

Nearly three-fourth of the companies surveyed have taken a loan during the past three years. Nearly half of the companies which had not taken loans in the past three years have turnover less than` 5 mn. A significant 60% of the sample does foresee a need for availing loans over the next three years.

Obstacles faced by the pharmaceutical companies while procuring funds

According to the survey, collateral requirements and the time taken to get the loan approved are two major obstacles which the respondent companies face while applying for a loan for their business, with around one fourth of the respondent companies confirming the same. While access to long term loans and short term loans are two least obstacles which are faced by the companies in the cluster.