Debt capital is often perceived as cheaper, faster, and less intrusive than equity. In practice, poorly structured debt can restrict growth, distort decision-making, and create long-term fragility.

Delnor Capital advises on debt funding and structured finance where discipline, sustainability, and lender alignment are critical.

Debt funding is typically suitable when:

• cash flows are stable and predictable,
• repayment capacity is clearly demonstrated,
• capital is required for defined, cash-generating purposes,
• dilution is strategically undesirable,
• governance and covenant discipline are acceptable.

Debt is not merely capital. It is an obligation with consequences.

Many debt funding challenges arise from incorrect assumptions, including:

• focusing on interest rate instead of structure,
• underestimating covenant and compliance implications,
• assuming lender appetite equals approval,
• treating documentation as a formality,
• overlooking refinancing and rollover risk.

These issues often surface after disbursement, when flexibility is already lost.

Lenders evaluate far more than collateral and turnover. Key areas of assessment include:

• cash-flow durability and coverage ratios,
• predictability of operating performance,
• capital structure and existing leverage,
• promoter discipline and financial transparency,
• downside resilience under stress scenarios.

Approval is driven by risk containment, not optimism.