Brickwork Ratings downgrades the long-term and short-term ratings for the Bank Loan Facilities of Rs. 197.98 Crs. of Mangalam Global Enterprise Ltd. based on the best available information, as the issuer did not cooperate.
ParticularsFacilities** | Amount (Rs.Crs.) | Tenure | Rating# | ||
---|---|---|---|---|---|
Previous | Present | Previous (03 Jul 2023) |
Present | ||
Fund Based | 190.98 | 190.98 | Long Term |
BWR BBB- /Stable
Upgrade and Removed from the INC category |
BWR BB
/Stable ISSUER NOT COOPERATING* /Downgrade |
5.00 | 5.00 | Short Term |
BWR A3
Upgrade and Removed from the INC category |
BWR A4
ISSUER NOT COOPERATING* /Downgrade |
|
Non Fund Based | 2.00 | 2.00 | Short Term |
BWR A3
Upgrade and Removed from the INC category |
BWR A4
ISSUER NOT COOPERATING* /Downgrade |
Grand Total | 197.98 | 197.98 | (Rupees One Hundred Ninety Seven Crores and Ninety Eight lakhs Only) |
Brickwork Rating (BWR) downgrades the long-term to BWR BB/Stable, the short-term rating to BWR A4, and migrates the rating in the Issuer Not Cooperating category. based on the best available information.
The annual review of the bank loan rating was due on 3 July 2024. Despite continuous follow-ups with the company, the company has not complied with the rating surveillance process. The current rating action has been taken by BWR based on the best available information on the issuers’ performance and under extant regulatory guidelines. The company has not submitted the monthly No Default Statement regularly. Due to the lack of management cooperation and in the absence of adequate complete information, BWR was unable to assess the Company’s overall business position and its ability to service its debt and maintain a valid rating.
The lenders/investors may note to exercise due caution while using the above rating which mentions "Issuer Not Cooperating" since the rating lacks any projections or forward-looking component as it is arrived at based on the best available information without any management/banker's interaction.
FINANCIAL PERFORMANCE: (Source: NSE website)
The company's operating income improved to Rs. 1669.17 Crores in FY24 (FY23: Rs. 1225.95 Crs). The Operating profit margin improved to 2.14% (EBIDTA Rs. 35.69 Crores ) in FY24 (FY23: OPM 2.08% & EBDITA Rs. 25.46 Crores), whereas the net profit margin improved to 1.13% (PAT Rs. 18.91 Crores) in FY24 (FY23: NPM: 0.97% & PAT Rs. 11.90 Crores). Gearing deteriorated to 1.20X in FY24 (FY23: 2.18X) Despite improved profitability, the Interest coverage ratios weakened to 1.48x in FY24 (FY23: 2.02x), and Debt service coverage marginally improved to 1.77x in FY24 (FY23: 1,71x). Tangible net worth improved to Rs. 133.78 Crores in FY24 (FY23: Rs. 94.17 Crores). On a provisional basis for the period ending on 30th June 2024, the company reported a total operating income of Rs. 628.10 Crores with an operating profit of Rs. 9.28 Crores (NPM 1.48%) and a net profit of Rs. 5.07 Crores (NPM: 0.81%).
ANALYTICAL APPROACH AND APPLICABLE RATING CRITERIA
For arriving at its ratings, BWR has applied its rating methodology as detailed in the Rating Criteria detailed below (hyperlinks provided at the end of this rationale).
Key Covenants: The terms of sanction include standard covenants normally stipulated for such facilities.
LIMITATIONS OF THE RATING
Information availability risk is a key factor in assessing credit risk as generally, non-cooperation by the rated entities to provide the 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 withholding of the information required for a review of the rating.
ABOUT THE ENTITYMacro Economic Indicator | Sector | Industry | Basic Industry |
---|---|---|---|
Fast Moving Consumer Goods | Fast Moving Consumer Goods | Agricultural Food & other Products | Other Agricultural Products |
Incorporated in 2010, Mangalam Global Enterprise Limited is set up by Ahmedabad-based Mangalam group. The Promoter of the Company are: Vipin Prakash Mangal, Chanakya Prakash Mangal and Chandragupt Prakash Mangal. The company is mainly engaged in the business of manufacturing and trading of Castor Oil (F.S.G.), Castor De-Oiled Cake, and High Protein Castor De-Oiled Cake for domestic and international markets. The company also engaged in the manufacturing and trading of cotton bales and cotton seeds. The company has also started manufacturing and trading of Mustard seed, Mustard oil, Mustard cake, Soya seed, Soya refined oil, Soya cake, Wheat and Rice, and other agricultural products.
(Information available as of July 2023)
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. View Previous Document
Not Applicable
RATING HISTORY FOR THE PREVIOUS THREE YEARS (including withdrawal and suspended)Facilities | Current Rating (2024) | 2023 | 2022 | 2021 | |||||
---|---|---|---|---|---|---|---|---|---|
Type | Tenure | Amount (Rs.Crs.) |
Rating | Date | Rating | Date | Rating | Date | Rating |
Fund Based | LT | 190.98 |
BWR BB/Stable
(ISSUER NOT COOPERATING* /Downgrade) |
03Jul2023 |
BWR BBB- Stable
(Upgrade and Removed from the INC category) |
21Dec2022 |
BWR BB Stable
(ISSUER NOT COOPERATING*/Downgraded) |
21Sep2021 |
BWR BBB- Stable
(Reaffirmation) |
Fund Based | ST | 5.00 |
BWR A4
(ISSUER NOT COOPERATING* /Downgrade) |
03Jul2023 |
BWR A3
(Upgrade and Removed from the INC category) |
21Dec2022 |
BWR A4
(ISSUER NOT COOPERATING*/Downgraded) |
21Sep2021 |
BWR A3
(Reaffirmation) |
Non Fund Based | ST | 2.00 |
BWR A4
(ISSUER NOT COOPERATING* /Downgrade) |
03Jul2023 |
BWR A3
(Upgrade and Removed from the INC category) |
21Dec2022 |
BWR A4
(ISSUER NOT COOPERATING*/Downgraded) |
21Sep2021 |
BWR A3
(Reaffirmation) |
Grand Total | 197.98 | (Rupees One Hundred Ninety Seven Crores and Ninety Eight lakhs Only) |
Analytical Contacts | |
---|---|
KunjalDabhi Ratings Analyst kunjal.d@brickworkratings.com |
Niraj Kumar Rathi Director Ratings niraj.r@brickworkratings.com |
1-860-425-2742 | media@brickworkratings.com |
SL.No. | Name of the Bank/Lender | Type Of Facilities | Long Term(Rs.Crs.) | Short Term(Rs.Crs.) | Total(Rs.Crs.) | Complexity of the Instrument |
---|---|---|---|---|---|---|
1 | Canara Bank | Cash CreditSanctioned | 45.00 | _ | 45.00 | Simple## |
2 | HDFC Bank | Short term loan-Pledge FundingSanctioned | _ | 5.00 | 5.00 | Simple## |
3 | HDFC Bank | GECLSanctioned | 2.34 | _ | 2.34 | Simple## |
4 | HDFC Bank | EPC/ PCFC/ FBP/ PSFCSanctioned | 35.00 | _ | 35.00 | Simple## |
5 | HDFC Bank | GECL 2.0Sanctioned | 9.57 | _ | 9.57 | Simple## |
6 | Punjab National Bank | GECL 1.0Sanctioned | 5.57 | _ | 5.57 | Simple## |
7 | Punjab National Bank | GECLSanctioned | 1.00 | _ | 1.00 | Simple## |
8 | Punjab National Bank | Cash CreditSanctioned | 40.00 | _ | 40.00 | Simple## |
9 | State Bank Of India (SBI) | Cash CreditSanctioned | 50.00 | _ | 50.00 | Simple## |
10 | State Bank Of India (SBI) | Bank GuaranteeSanctioned | _ | 2.00 | 2.00 | Simple## |
11 | State Bank Of India (SBI) | Term LoanSanctioned | 2.50 | _ | 2.50 | Simple## |
Total | 190.98 | 7.00 | 197.98 | |||
TOTAL (Rupees One Hundred Ninety Seven Crores and Ninety Eight lakhs Only) |
##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.
Instrument | Issue Date | Amount (Rs.Crs) | Coupon Rate (%) | Maturity Date | ISIN Particulars | Complexity of the Instrument |
---|---|---|---|---|---|---|
Nil | Nil | Nil | Nil | Nil | Nil | Nil |
Name of Entity | % Ownership | Extent of consolidation | Rationale for consolidation |
---|---|---|---|
Nil | Nil | Nil | Nil |
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