As OK Vaquero had mentioned, the places to drill are already marked on the back of the panels. Instructions called for a 1in hole saw bit but I used a 1 1/8 for a little extra clearance. Worked out well. You also want to make sure you use a fine toothed hole saw bit to minimize damage to the panel and paint on the outside. When I drilled out mine, I had no chipping of the paint and minimal edge cleaning (removing the burrs from the hole saw)
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