LC Limit Letter

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RSL:CB:2016-17:05

July 1, 2016

The Deputy General Manager

Industrial Development Bank of India Ltd.

44 Shakespeare Sarani

Kolkata – 700 017

Sub : Opening of L/C for USD 248250 for purchase of 750 MT ± 5% of Methanol

Dear Sir,

Methanol is one of our major raw materials for manufacture of Plywood and Formaldehyde. We are importing Methanol in consignments of about 1000 MT at a time by opening Letter of Credit from banks. We have presently contracted for buying Methanol of 750 MT ± 5% at an agreed value of USD 248250.

We would like to submit that as per Consortium arrangement, our Company has been sanctioned a L/C limit of Rs.600 lacs which was divided among the Consortium banks as follows:

		Rs. – Lacs
State Bank of India	…	475.00
State Bank of Hyderabad	…	70.00
State Bank of Travancore	…	55.00
		600.00

You are aware that recently there has been a change in the Consortium arrangement and State Bank of Travancore has exited from the Consortium and IDBI Ltd. has joined the Consortium. While inducting IDBI Ltd. in the Consortium, the L/C limit of Rs.55 lacs allocated to State Bank of Travancore were not allocated to IDBI Ltd. In other words, out of the limit of Rs.600 lacs, we have already an unallocated limit of Rs.55 lacs.

Kindly note that the equivalent value of our present L/C for USD 248250 roughly comes to Rs.115 lacs. Considering the unallocated limit of Rs.55 lacs. There is a shortfall of about Rs.60 lacs.

Apart from this, we have also to open a L/C for EURO 38000, equivalent Indian Rupee of which comes to about Rs.20 lacs. The total shortfall, taking this L/C into consideration, comes to Rs.80 lacs.

Contd…. P/2

-  2  -

Since our requirements are very very urgent, we would request you to allow us a short-term arrangement for opening of these two L/Cs without any margin. You will kindly appreciate that our L/Cs have never been defaulted and we have made all payments on due date.

Since the loading of the ship is going on, your immediate action will be highly appreciated.

Thanking you,

Yours faithfully,

For ROCKET SALES LTD.

NEETU SINGH

MANAGING DIRECTOR

P.S.

We are enclosing two applications for opening of two L/Cs as mentioned hereinabove.

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