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The Surety Bonds series : Part 1 Size DOESN’T matter! The Most Important Number in Surety Underwriting Isn’t Revenue 💰 Most contractors believe the same thing: “If my revenue grows, I will be eligible for surety bonds and my surety capacity will grow.” In reality, I’ve seen contractors with ₹5,000+ crore revenues struggle to obtain meaningful surety bonds capacity. And I’ve seen significantly smaller contractors receive surprisingly large support (It may have something to do with our, Surety Seven (007), magical support 🪄 too 😉) Why? Because the most important number in surety underwriting is often NOT revenue. Revenue tells us how big a company is. It doesn’t tell us: • Whether projects are profitable! • Whether cash is actually being collected 🧐 • Whether working capital is under control 💸 • Whether growth is sustainable 📈 • Whether management has financial discipline 👨💼 A contractor can report record revenues and still be becoming riskier every quarter. Conversely, another contractor may grow more slowly, generate strong cash flows, maintain discipline, and become increasingly attractive to (re)insurers. This is one of the biggest differences between traditional lending (of banks for BGs) and surety bonds underwriting. Surety is not merely about size. It is about confidence in future performance 💪 As the Indian surety market matures, I believe contractors that focus on cash generation, governance, project execution and balance sheet quality will consistently attract more capacity than those focused solely on revenue growth 😊 The question every contractor (owner, Director, MD), CEO and CFO should ask is: If your revenue doubled next year, would your surety capacity double too? Or would underwriters still have the same concerns? Some financial metrics that I believe tell the most accurate story about a contractor’s true strength are: 1. Liquidity Ratios 2. Cash Flow statements 3. Leverage Ratios (Debt Levels & Debt Utilization) 4. History of Project execution If you are looking for a credible way to power your company’s Surety Bonds requirements, Reach out to Surety Seven (007) NOW! https://lnkd.in/dSHExKvr #suretybonds #infrastructure #insurance #reinsurance #contractors #ProjectFinance #SuretySeven #cfo