Project DSCR Calculator: Debt Service Coverage
Model debt service coverage across the tenor of a limited-recourse loan. Change any input to see minimum, average and per-period DSCR update instantly.
Illustrative planning only. Default inputs and rules are example assumptions, not market rates, fees, coverage, tenors or lender criteria. Results are not credit approval, pre-approval, a financing offer, underwriting, a recommendation or a commitment. Excludes fees, taxes, insurance premiums, FX and lender-specific terms.
DSCR = cash flow available for debt service (CFADS) ÷ total debt service (principal + interest) in the same period. Enter the loan amount, interest rate, tenor, year-1 CFADS and its growth rate; the calculator builds the amortisation schedule and shows minimum, average and per-year DSCR. Lenders on industrial project finance typically require a minimum DSCR of 1.20x–1.40x.
| Year | Opening | Interest | Principal | Debt service | CFADS | DSCR |
|---|---|---|---|---|---|---|
| 1 | 50,000,000 | 3,750,000 | 3,534,296 | 7,284,296 | 9,500,000 | 1.30x |
| 2 | 46,465,704 | 3,484,928 | 3,799,369 | 7,284,296 | 9,690,000 | 1.33x |
| 3 | 42,666,335 | 3,199,975 | 4,084,321 | 7,284,296 | 9,883,800 | 1.36x |
| 4 | 38,582,014 | 2,893,651 | 4,390,645 | 7,284,296 | 10,081,476 | 1.38x |
| 5 | 34,191,368 | 2,564,353 | 4,719,944 | 7,284,296 | 10,283,106 | 1.41x |
| 6 | 29,471,425 | 2,210,357 | 5,073,940 | 7,284,296 | 10,488,768 | 1.44x |
| 7 | 24,397,485 | 1,829,811 | 5,454,485 | 7,284,296 | 10,698,543 | 1.47x |
| 8 | 18,943,000 | 1,420,725 | 5,863,571 | 7,284,296 | 10,912,514 | 1.50x |
| 9 | 13,079,429 | 980,957 | 6,303,339 | 7,284,296 | 11,130,764 | 1.53x |
| 10 | 6,776,090 | 508,207 | 6,776,090 | 7,284,296 | 11,353,379 | 1.56x |
How to calculate DSCR
- 1Enter the debt amount. Use the senior facility only — the portion of total project cost funded with debt, excluding equity and grants.
- 2Set rate and tenor. All-in interest rate (base plus margin) and the repayment tenor in years. The schedule assumes level annuity amortisation after financial close.
- 3Enter year-1 CFADS. Cash flow available for debt service is EBITDA minus tax, minus maintenance CAPEX and working-capital movements — not EBITDA itself.
- 4Add a CFADS growth assumption. Model realistic growth (or decline) across the tenor. Lenders will also run a downside case with flat or reduced CFADS.
- 5Read minimum DSCR, not average. Facilities are sized on the weakest period. If minimum DSCR falls below the covenant, the loan will be resized, tenor extended or equity increased.
DSCR questions buyers ask
What is a good DSCR for industrial project finance?
Lenders typically require a minimum DSCR of 1.20x–1.40x for industrial and agri-industrial projects with contracted offtake, and 1.40x–1.60x where revenue is merchant or commodity-exposed. Below 1.0x the project cannot service its debt from operating cash flow in that period.
What is the difference between CFADS and EBITDA?
CFADS is EBITDA after cash tax, maintenance CAPEX and working-capital movements, and after any reserve-account funding. Using EBITDA in place of CFADS systematically overstates coverage and is the most common modelling error in first-draft bankability cases.
Why does minimum DSCR matter more than average DSCR?
Debt is sized against the weakest year in the schedule. A project averaging 1.6x but dipping to 0.9x in year three will trigger a covenant breach in that year, so lenders size the facility to the minimum, not the average.
How can I improve a weak DSCR?
Extend the tenor, add a grace period on principal during ramp-up, increase equity to reduce the debt amount, obtain ECA cover to lower pricing, or improve project cash flow through better offtake pricing or lower operating cost.
Combine this coverage model with our supplier-neutral readiness checker to identify the most plausible lender syndicate — commercial, ECA, DFI or blended.
