TEV Study by a Chartered Engineer: Techno-Economic Viability for Bank Loans
What a TEV study is
A Techno-Economic Viability (TEV) study is the technical and financial feasibility appraisal a bank, NBFC or lender consortium commissions before sanctioning a term loan for a greenfield project, expansion, modernisation or diversification. It is prepared by an empanelled Chartered Engineer independently of the promoter's own Detailed Project Report (DPR), giving the lender a technical opinion it hasn't paid the promoter to produce.
When a TEV study is required
- Greenfield projects, where no operating history exists to assess
- Brownfield expansion, modernisation or diversification of an existing unit
- Consortium or syndicated lending, where multiple banks need a shared, independent appraisal
- RBI restructuring proposals, where lenders need a fresh viability opinion before revising terms
What a TEV study covers
- Technology and process assessment: whether the proposed technology and process are proven and appropriate for the project
- Project cost estimate: land, buildings, plant and machinery, preliminary and pre-operative expenses, and contingencies
- Means of finance: the proposed debt-equity mix and its adequacy
- Implementation schedule: whether project milestones and timelines are realistic
- Market and demand assessment: whether projected sales are achievable
- Financial viability: Debt Service Coverage Ratio (DSCR), Internal Rate of Return (IRR), break-even point and sensitivity analysis under adverse scenarios
TEV study vs Lender's Independent Engineer (LIE) report
A TEV study and an LIE report cover the same project at different phases. The TEV study is a one-time appraisal completed before the loan is sanctioned. Once the loan is sanctioned, a Lender's Independent Engineer monitors the same project through implementation, certifying disbursements against actual physical progress. See our full guide to Lender's Independent Engineer (LIE) reports.
Who commissions a TEV study
- Banks and NBFCs evaluating a term loan application
- Lead or consortium banks in syndicated lending arrangements
- Promoters preparing a project report ahead of approaching lenders
- Asset Reconstruction Companies (ARCs) assessing a restructuring proposal
Related services & resources
Frequently asked questions
Who prepares a TEV study?
An empanelled Chartered Engineer, appointed by the bank, NBFC or lead lender, prepares the TEV study independently of the promoter. Axium's partners, Harihar S and Kamalakannan C, undertake TEV assignments as part of Axium's Chartered Engineer services.
Is a TEV study the same as a DPR?
No. The Detailed Project Report (DPR) is prepared by or for the promoter to make the case for the project. The TEV study is an independent appraisal commissioned by the lender to test the DPR's assumptions on technology, cost and financial viability before sanctioning a loan.
What is the difference between a TEV study and an LIE report?
A TEV study is a one-time appraisal completed before a term loan is sanctioned. A Lender's Independent Engineer (LIE) report is the ongoing monitoring that follows after sanction, tracking the same project through implementation and certifying disbursements.
Does Axium prepare TEV studies?
Yes. Axium's partners, Chartered Engineers Harihar S (Registration F-125668) and Kamalakannan C (Registration M-1564255), prepare TEV studies for banks, NBFCs and lender consortiums evaluating greenfield, expansion and modernisation term loans.
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