Covenant Monitoring Platform
Certain parameters are set which helps the investors to stay updated in order to measure and keep a check on the stability in the performance of the company. These parameters are also called as Covenants that the company is obliged to perform throughout the tenure of the securities issued by the company. These Parameters are mainly classified as information covenants, reporting covenants, affirmative covenants, negative covenants, financial covenants, etc. which are further segregated based on periodicity i.e., monthly, quarterly, half yearly and annual basis.
Following parameters are required to be maintained by the Debenture Issuing company:
- Assessing company’s ability to meet short- and long-term financial commitments using the liquidity and solvency ratios
- Assessing your company’s ability to generate earnings compared to its expenses using profitability ratios
- Revenue, capital expenditure and EBITDA such other financial indicators
- Operational indicators related like number of customers and number of sellers
- Analyzing the liquidity, solvency, and profitability to ascertain the performance of your company
- Covenants related to the funding, management control and ownership of your company to be assessed
- Understanding whether the additional capital can be raised using debt instruments and determining the ideal mix of capital required
- Evaluating the historical financial performance to forecast future earnings of your company