(1) Valuation Policy

(a) Valuation of Land. The market value shall be considered for calculating the value of the property. The market value shall be obtained either from the External Valuer empanelled by the Corporation or from the Revenue Department.

The External Valuer shall consider the following factors while fixing the market value.

• Document value with registration and other charges.
• Fair value as notified by the Government.
• Indexed cost of acquisition in the following manner:

Actual Cost of Acquisition x CII of the year in which asset is valued
CII of the year in which asset is acquired

(CII- Cost Inflation Index)

• Similar property document value.
• Value based on enquiries made with SRO/ Village office/ local people.

The Valuer has to ascertain the actual area legally owned by the titleholder based on local enquiry, verification of location sketch, survey plan, etc. The valuer shall arrange the survey plan through a private surveyor, if required.

The extent shown in the Title Deed or the Actual Extent in Legal Possession, whichever is lower, will be considered for valuation purposes. The final value of the land shall be based on factors like the type of land, road access, location, distance from nearest town/ city, availability of infrastructure, proximity to public/ private institutions, saleability of the land, demand in the market, etc. Sufficient reasoning should be provided in the valuation report for the variations from document value/ fair value/ indexed cost of property/ similar document value.

The market value of the land (Valuation Certificate) issued by the Revenue Department of Government of Kerala, by an official of not below the rank of a serving Tahasildar, as per the guidelines issued by the Government from time to time, can also be accepted by the Corporation, instead of the External Valuer report. 

(b) Cost of Building for Project Cost and Security purposes. The value shall be fixed according to the prevailing cost of labour& materials as approved by the Institution of Valuers, Thiruvananthapuram. Depreciation, shall be provided for existing buildings.

(c) Margin Calculations. Assets and its margin that can be considered for security purposes shall be as follows:

	Item	Margin (%)	Value taken as security (%)
a)	Land including land development/land scaping/ Gardening	NIL	100
b)	Building / Building Renovation	15	85
c)	Plant & machinery and equipment including erection, electrification	15	85
d)	Second hand imported and reconditioned machinery	50	50
e)	Other second-hand machinery	50	50
f)	Moulds& Dies	25	75
g)	Tools/Accessories/Fittings	75	25
h)	Furniture /Fixtures / shelf
	For Hotel Sector	25	75
	For Other Projects	75	25
i)	Technical know how
	Developed by the Promoter and has patented / copyright is hypothecated with Corporation and entered into non-disclosure agreement	75	25
	Others	100	Nil
j)	Computer & accessories including erection, electrification	50	50
k)	Software
	Developed by the Promoter and has patented / copyright is hypothecated with Corporation and entered into non-disclosure agreement	50	50
	Others	100	Nil
l)	Interior decoration	75	25
m)	Office equipment and furniture	75	25
n)	Medical Diagnostic equipment which are part of a hospital (life of the items should cover the loan period)	50	50
o)	Diagnostic and testing equipment/ lab equipment	50	50
p)	Furnishing/ curtains/ and decorative items	100	NIL
q)	Crockery, cutlery and vessels	75	25
r)	Vehicles including extra fittings cost of body, essential tools and excluding insurance, Road tax etc.	50	50
s)	DG set	70	30
t)	Lift, Firefighting equipment, Air Conditioners etc.	70	30
u)	Cost of optical fibre lines	100	NIL
v)	Gymnasium equipment	50	50
w)	Reference books	100	NIL
x)	Kitchen equipment including erection and electrification	50	50
y)	Fixed Deposit/ Gold/ guaranteed Surrender Value of IRDAI approved Insurance policies	Nil	100
While calculating security value, preliminary expenses, other intangible expenses, deposits with Electricity Board, Margin Money for Working Capital etc. are not to be taken. All values to be considered after applicable depreciation.

 

(2) Security Requirements

(a) Benchmark Asset Coverage Ratio (ACR).  The benchmark Asset Coverage Ratio (ACR) for all loans shall be as follows (except for CMEDP Loans/ Contractor Loans/ Start-up loans/ other Special Schemes where security requirements are specifically provided):

* The minimum loan amount that can be applied under CMEDP for FY 2021-22 shall be Rs.5 lakh.

(b) Minimum security requirements for Government Contractor Loans. Minimum security requirements for various facilities to Government Contractors shall be as follows:

Sl No	Facility Name	Norms
	Performance Guarantee/ Bank Guarantee Facility	100%
	Work Execution Facility	100%
	EBDS Facility- Early Bill Discounting Facility with Security	50%
	EBDS Facility- Early Bill Discounting Facility without security	Nil
	GBDS Facility    - Government Bill Discounting Facility	Nil
	EF Facility       - Equipment Finance Facility	100%