RATING RATIONALE
08Aug2022

Ambika Electronics

Brickwork Ratings downgrades the long term ratings for the Bank Loan Facilities of Rs. 41.40 Crs. of Ambika Electronics based on best available information, as the issuer did not cooperate.

Particulars
Facilities** Amount (Rs.Crs.) Tenure Rating#
Previous Present Previous
(13 May 2021)
Present
Fund Based 41.40 41.40 Long Term BWR BB/Stable
Reaffirmation
BWR BB - /Stable
ISSUER NOT COOPERATING* /Downgrade
Grand Total 41.40 41.40 (Rupees Forty One Crores and Forty 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 long-term rating of the Bank Loan Facilities of the entity have been downgraded at BWR BB-/Stable ISSUER NOT COOPERATING. BWR has been consistently following up with the entity management which has remained non-co-operative to submit the information/details required for the review of rating despite our regular follow-up.

The rating was due for review on 13th May 2022. The entity was regularly followed up for the surveillance, vide emails dated 25th April, 2nd May, 9th May, 16th May, 23rd May, 30th May, 10th June, 13th June, 20th June, 27th June, 4thJuly, 1st August 2022. The company did not cooperate in undertaking the rating process in spite of following up several times. In the absence of adequate information from the entity, BWR is unable to assess the entity’s financials. Hence, on account of inadequate information and lack of management cooperation, Brickwork Ratings has downgraded the rating to BWR BB- (Stable) ISSUER NOT COOPERATING / Downgrade.

The lenders/investors may note to exercise due caution while using the above rating which mentions "Issuer Not Cooperating" since the rating lack any projections or forward looking component as it is arrived at based on the best available information without any management/banker's interaction.

LIMITATIONS OF THE RATING

Information availability risk is a key factor in the assessment of credit risk as generally, non-cooperation 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 ratings should therefore take into account possible deterioration in the credit quality of the rated entity arising from its non-transparency withholding of information required for a review of the rating.

ABOUT THE ENTITY

Ambika Electronics was established as a partnership firm in Bengaluru during 1990. Ramesh Aithal & Shantharam Holla are the partners of the firm. The firm trades in consumer electronics, home appliances segment. The firm is an authorised distributor of electronic equipments for LG Electronics India Pvt Ltd, Samsung, Intex Technologies, Whirlpool, Hapag Lloyd India Pvt Ltd, Onida, DECCO Appliances Pvt Ltd, Varnada Industries Pvt Ltd, Havells India Ltd, Kenstar India Pvt Ltd. The firm is the sole distributor in 5 areas: Bengaluru city, Bengaluru rural, Tumkur, Chickbalapur, Kolar. The list of products includes: Consumer Electronics, Home Appliances, Kenstar Coolers. The firm pays 100% advance to its suppliers to carry on its business activity. The firm caters to about 250 dealers across Karnataka.

In order to increase turnover in the future they have added superstock of Vu television brand in October 2020 and plan to add Mi brand as well. The firm is a super stockist for a number reputed brands. The main source of profit margin is from the discount and incentive derived from the main suppliers as the MRP is fixed by the suppliers.

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. View Previous Document

STATUS OF NON-COOPERATION WITH PREVIOUS CRA

Rated Amount (Rs. Crs) Date of Rationale Rating  CRA Name Type
22 28-May-2019 BB-(Stable) CRISIL Active
22 24-Aug-2020 BB-(Stable) CRISIL Non-Cooperation
22 11-Nov-2021 B (Stable) CRISIL Non-Cooperation

RATING HISTORY FOR THE PREVIOUS THREE YEARS (including withdrawal and suspended)
Facilities Current Rating  (2022) 2021 2020 2019
Type Tenure Amount
(Rs.Crs.)
Rating Date Rating Date Rating Date Rating
Fund Based LT 41.40
BWR BB-/Stable
(ISSUER NOT COOPERATING* /Downgrade)
13May2021
BWR BBStable
(Reaffirmation)
NA
NA
22Nov2019
BWR BBStable
(Assignment)
Grand Total 41.40 (Rupees Forty One Crores and Forty lakhs Only)
Rating Advisory, as on 13May2022
Press Release, as on 13May2022
Advisory was issued on account of non-receipt of essential information required for review of the ratings

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

Jigar Manik Gogri

Ratings Analyst jigarmanik.g@brickworkratings.com

Sushil Kumar Chitkara

Director - Ratings Board : +91 22 2831 1426, +91 22 2831 1439 sushilkumar.c@brickworkratings.com
1-860-425-2742 | media@brickworkratings.com
Ambika Electronics
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 Canara Bank Covid -19 Emergency Line CreditSanctioned 3.00 _ 3.00
2 Canara Bank OverdraftSanctioned 32.00 _ 32.00
3 Canara Bank GECLSanctioned 6.40 _ 6.40
Total 41.40 0.00 41.40
TOTAL (Rupees Forty One Crores and Forty lakhs Only)
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About Brickwork Ratings

Brickwork Ratings (BWR), a Securities and Exchange Board of India [SEBI] registered Credit Rating Agency and accredited by Reserve Bank of India [RBI], offers credit ratings of Bank Loan, Non- convertible / convertible / partially convertible debentures and other capital market instruments and bonds, Commercial Paper, perpetual bonds, asset-backed and mortgage-backed securities, partial guarantees and other structured / credit enhanced debt instruments, Security Receipts, Securitization Products, Municipal Bonds, etc. BWR has rated over 12,000 medium and large corporates and financial institutions’ instruments. BWR has also rated NGOs, Educational Institutions, Hospitals, Real Estate Developers, Urban Local Bodies and Municipal Corporations. BWR has Canara Bank, a leading public sector bank, as one of the promoters and strategic partner. BWR has its corporate office in Bengaluru and a country-wide presence with its offices in Ahmedabad, Chandigarh, Chennai, Hyderabad, Kolkata, Mumbai and New Delhi along with representatives in 150+ locations.

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