JML was an integrated heavy machinery manufacturing plant which was set up in collaboration with world-renowned firms for the manufacture of machinery and equipment required for steel, mining, sugar, cement, paper and pulp. The project incurred a heavy overrun of costs due to excessive investment in infrastructural facilities like housing and ancillary services. Its cash inflows were also delayed due to labour trouble and communal riots and it got saddled with a backlog of orders which, at current prices of raw materials, were uneconomic. JML then approached Vikas Bank for a further loan of Rs150 lakh to balance its capital structure and finance balancing equipment and housing projects. The case highlights the need for a formal analysis of uncertainties in the key factors affecting the rate of return of such a capital intensive project. It also raises issues of designing an appropriate financing plan, given the risks inherent in the project and poor cash flows.