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Private Limited Company Struggles with Debt: How to Secure Equity Investment?

Chandu

Chandu Nair  | Answer  |Ask -

VC, Angel Investing, Entrepreneurship Expert - Answered on Jul 08, 2024

Chandu Nair advises entrepreneurs and enterprises about creating and building their business.
He has direct experience in angel, venture capital and strategic investor funding. Over the last three decades, he has made a name for himself in industry, consultancy, media and information services.
Nair is on the advisory boards of the Chennai-based private equity firm Fulcrum and the social impact fund, Menterra. He's an independent director on the board of India's first retail building products company, Shankara Building Products Limited.
He was the co-founder of Scope e-Knowledge Center, a pioneering knowledge process outsourcing company, as well as the co-founder of a business-to-business e-commerce venture, both of which he successfully exited.... more
Vivek Question by Vivek on Sep 24, 2023Hindi
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Hello Sir, I have a private limited company which had turnover of Rs. 24.5 cr but losses Rs. 4 cr. We have debt of Rs. 5 crores and other liabilities are approx Rs. 5 crores. Banks are not giving us loan for working capital. What should we do to get the equity investment so that we can reduce the burden of debt and other liabilities and also continue our business. The prospects for the FY 2023-24 are good if we get to run the business without any stress of liabilities.

Ans: This requires deeper understanding of the nature of your business, its financial performance, the capital structure, the prospects of your industry, the differentiation that your business has vs competition, the quality of your team etc before one can consider an equity investment. I am not privy to such info. You may want to consult a financial advisor.
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