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You are a lender tasked with analyzing a company’s loan request. To meet your loan criteria, the company must have:

- A coverage ratio in excess of 1x.
- A leverage ratio in excess of 5x.

Exceptions: Fintech, Technology, and Biotech firms qualify for a loan regardless of the coverage and leverage ratios.

Additional Criteria:

- If the loan amount requested (expressed as a multiple of EBITDA) is greater than 25% of the company’s industry EV/EBITDA, the approved loan amount will be limited to 25% of the company’s industry EV/EBITDA.

- If the criteria for a loan are not met, output "Don’t lend!"

Task:

- For any industry selected, calculate the amount of the approved loan expressed as a multiple of EBITDA in cell C25.

Answer :

To analyze a company's loan request and determine if it meets the loan criteria, the following conditions must be considered:

Coverage ratio and leverage ratio: The company must have a coverage ratio in excess of 1x and a leverage ratio in excess of 5x. These ratios assess the company's ability to cover its debt obligations and manage its debt levels. If the company meets these requirements, it can proceed with the loan application.

Exceptions for specific industries: Fintech, Technology, and Biotech firms are exempt from the coverage and leverage ratio criteria. These industries are considered to have unique characteristics and growth potential, so they automatically qualify for a loan regardless of their financial ratios.

Loan amount limitation: If the loan amount requested, expressed as a multiple of EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization), exceeds 25% of the company's industry EV/EBITDA, the approved loan amount will be limited to 25% of the industry EV/EBITDA. This limitation ensures that the loan remains within a reasonable range relative to the company's industry.

Calculation of approved loan amount: The approved loan amount, expressed as a multiple of EBITDA, can be calculated based on the company's industry EV/EBITDA. The specific calculation can be performed using the provided industry data and the loan request information, and the result should be entered in cell C25.

By evaluating these loan criteria and performing the necessary calculations, the lender can determine if the company's loan request meets the established requirements.

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