RATING RATIONALE
08Nov2021

Vaswani Industries Ltd.

Brickwork Ratings downgrades the ratings for the Bank Loan Facilities of Rs. 76.95 Crs. of Vaswani Industries Ltd. based on best available information, as the issuer did not cooperate.

Particulars
Facilities** Amount (Rs.Crs.) Tenure Rating#
Previous Present Previous
(14 Oct 2020)
Present
Fund Based 44.95 44.95 Long Term BWR BBB-/Stable
Reaffirmation
BWR BB + /Stable
Downgrade/ISSUER NOT COOPERATING*
Non Fund Based 32.00 32.00 Short Term BWR A3
Reaffirmation
BWR A4 +
Downgrade/ISSUER NOT COOPERATING*
Grand Total 76.95 76.95 (Rupees Seventy Six Crores and Ninety Five lakhs Only)
#Please refer to BWR website www.brickworkratings.com for definition of the ratings
**Details of Bank Loan facilities,consolidation or instruments are provided in Annexure
*Issuer did not cooperate; based on best available information.


RATING ACTION / OUTLOOK / NATURE OF NON-COOPERATION

The rating was due in Oct 2021. Despite the best efforts of BWR to get at least the minimum required information for a review, the company has not provided the same. BWR has tried to contact the client via emails and also via call. BWR also tried to obtain the banker feedback but failed to get the same. The Company has received an external credit rating from another CRA and has failed to provide NDS for the last two months despite reminders.
In the absence of adequate information from the company, BWR is unable to assess the company’s financial performance and its ability to service its debt and maintain a valid rating.
On account of inadequate information for undertaking review and lack of management cooperation, the ratings have been revised and placed under the Issuer Not Co-operating category.

LIMITATIONS OF THE RATING

Information availability risk is a key factor in the assessment of credit risk as generally, noncooperation by the rated entities to provide required information for a review of the assigned rating may also be accompanied by financial stress. Users of the credit rating should therefore take into account the possible deterioration in the credit quality of the rated entity arising from its non- transparency and withholdings of the information required for a review of the rating.

ABOUT THE ENTITY

Vaswani Industries Ltd. was incorporated under the Companies Act, 1956 on July 22, 2003 with the Registrar of Companies, Madhya Pradesh and Chhattisgarh and obtained Certificate of Business Commencement on February 10, 2004. The company was established with the object of manufacturing of Sponge Iron, Steel Billets and captive Power Generation. The company belongs to Vaswani Group of companies which has interest in iron & steel of over past two decades. The developments of the Company are as under:
The company has manufacturing facilities in an industrial area at Sondra village, 14 km from Raipur railway station. The company’s installed first kiln of 1 x 100 TPD sponge iron in the year 2004-05 and over the period of time enhanced the total capacity of sponge iron to 3 x 100 TPD.
Has installed three Induction Furnaces for manufacturing of Steel Billets & Ingots utilizing in-house production of Sponge Iron.
The company started using power for captive consumption in 2009. Power generation capacity enhanced to 11.5 MW (9 MW from WHRB and 2.50 MW from Coal) during the year 2010-2011.
Acquisition of C.G Ispat Pvt Ltd in 2010.

KEY FINANCIAL INDICATORS

Please refer to the following link for the previous detailed rationale that captures the Key Financials Drivers and their Description, Liquidity Position. Rating Sensitivities, Key Financial Indicators.

NON-COOPERATION WITH PREVIOUS CREDIT RATING AGENCY

NA

RATING HISTORY FOR THE PREVIOUS THREE YEARS (including withdrawal and suspended)
Facilities Current Rating  (2021) 2021 (History) 2020 2019 2018
Type Tenure Amount
(Rs.Crs.)
Rating Date Rating Date Rating Date Rating Date Rating
Fund Based LT 44.95
BWR BB+/Stable
(Downgrade/ISSUER NOT COOPERATING*)
NA
NA
14Oct2020
BWR BBB-Stable
(Reaffirmation)
15Feb2019
BWR BBB-Stable
(Upgrade)
15Jun2018
BWR BB+Stable
(Assignment)
Non Fund Based ST 32.00
BWR A4+
(Downgrade/ISSUER NOT COOPERATING*)
NA
NA
14Oct2020
BWR A3
(Reaffirmation)
15Feb2019
BWR A3
(Upgrade)
15Jun2018
BWR A4+
(Assignment)
Grand Total 76.95 (Rupees Seventy Six Crores and Ninety Five lakhs Only)
COMPLEXITY LEVELS OF THE INSTRUMENTS - Simple

BWR complexity levels are meant for educating investors. The BWR complexity levels are available at www.brickworkratings.com / download / ComplexityLevels.pdf. Investors queries can be sent to info@brickworkratings.com.

Hyperlink/Reference to applicable Criteria
Analytical Contacts

Saloni Ramprakash Singh

Rating Analyst Board : +91 22 2831 1426, +91 22 2831 1439 saloni.s@brickworkratings.com

Vidya Shankar

Principal Director - Ratings Board : +91 80 4040 9940 vidyashankar@brickworkratings.com
1-860-425-2742 | media@brickworkratings.com
Vaswani Industries Ltd.
ANNEXURE-I
Details of Bank Facilities rated by BWR
SL.No. Name of the Bank/Lender Type Of Facilities Long Term(Rs.Crs.) Short Term(Rs.Crs.) Total(Rs.Crs.)
1 Bank of Baroda Cash CreditSanctioned 7.00 _ 7.00
2 Bank of Baroda Bank GuaranteeSanctioned _ 1.00 1.00
3 Bank of Baroda Letter of CreditSanctioned _ 5.00 5.00
4 IDBI Bank Letter of CreditSanctioned _ 11.00 11.00
5 IDBI Bank Cash CreditSanctioned 10.00 _ 10.00
6 IDBI Bank Bill Discounted (BD)Sanctioned 5.00 _ 5.00
7 State Bank Of India (SBI) Stand by Line of CreditSanctioned 4.95 _ 4.95
8 State Bank Of India (SBI) Bank GuaranteeSanctioned _ 3.00 3.00
9 State Bank Of India (SBI) Cash CreditSanctioned 18.00 _ 18.00
10 State Bank Of India (SBI) Letter of CreditSanctioned _ 12.00 12.00
Total 44.95 32.00 76.95
TOTAL (Rupees Seventy Six Crores and Ninety Five lakhs Only)
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