RATING RATIONALE
13Sep2022

Vamshi Rubber Ltd

Brickwork Ratings reaffirms the ratings and continues the ratings in the 'Issuer Not Cooperating' category for the Bank Loan Facilities of Rs. 22.06 Crs. of Vamshi Rubber Ltd based on best available information, as the issuer did not cooperate.

Particulars
Facilities** Amount (Rs.Crs.) Tenure Rating#
Previous Present Previous
(27 Aug 2021)
Present
Fund Based 19.06 19.06 Long Term BWR B- /Stable
Downgrade/ISSUER NOT COOPERATING*
BWR B - /Stable
Continues to be in ISSUER NOT COOPERATING* category/Reaffirmed
Non Fund Based 3.00 3.00 Short Term BWR A4
Reaffirmation/ISSUER NOT COOPERATING*
BWR A4
Continues to be in ISSUER NOT COOPERATING* category/Reaffirmed
Grand Total 22.06 22.06 (Rupees Twenty Two Crores and Six 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

In view of the non-availability of complete information and lack of cooperation from ‘Vamshi Rubber Ltd.’, Brickwork Ratings has reaffirmed the long term rating of “BWR B-/Stable” and reaffirmed the short term rating of “BWR A4” and continued the ratings in the “Issuer Not Cooperating” category, based on best available information as the Issuer did not cooperate.

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

The ratings were due for review in August, 2022. BWR took up with the company recently over emails and through telephone calls to obtain the required information. Despite the best efforts of BWR to get at least the minimum required information for a review,  the entity has not provided the same. The company has also not been furnishing the required monthly Non Default Statements (NDS). 

Thus, due to lack of management cooperation to furnish adequate information about the company's performance despite follow up, coupled with its non submission of NDS, BWR is unable to assess its financial performance or its ability to service its debt and maintain a valid rating. Accordingly, the long term and short term ratings have been reaffirmed  and continued the ratings in the “Issuer Not Cooperating” category. The rating reaffirmation is based on the lack of up-to-date information on the company’s performance.

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 rating 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

Incorporated in November, 1993 at Hyderabad, Vamshi Rubber Ltd (VRL) is engaged in the business of manufacturing PCTR (Pre-cured tread rubber), cushion gum, vulcanising solution, and curing envelopes used to retread tires. VRL is listed on the Bombay Stock Exchange. The Company caters to the tyre retreading material manufacturing industry and is ISO 9001-2008 certified. VRL's manufacturing plant has an annual production capacity of 4600 MT of Precured Tread Rubber, 300 MT of Cushion Gum, 150 KL of Vulcanizing Solution and 12,000 of Envelopes. Mr. R Surendra Reddy is the Managing director. Mr M. Ramesh Reddy, Mr. P Varun Kumar and Mr. K. V. Sarma are the other Directors.

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

CRISIL has continued the ratings of the bank loan facilities of Rs. 21.00 Crores of 'Vamshi Rubber Limited' in the ‘Issuer Not Cooperating’ category on 30 May 2022, with ratings of “CRISIL B (Stable)/ CRISIL A4 ; ISSUER NOT
COOPERATING”.

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 19.06
BWR B-/Stable
(Continues to be in ISSUER NOT COOPERATING* category/Reaffirmed)
27Aug2021
BWR B- Stable
(Downgrade/ISSUER NOT COOPERATING*)
21May2020
BWR B+ Stable
(Downgrade/ISSUER NOT COOPERATING*)
NA
NA
Non Fund Based ST 3.00
BWR A4
(Continues to be in ISSUER NOT COOPERATING* category/Reaffirmed)
27Aug2021
BWR A4
(Reaffirmation/ISSUER NOT COOPERATING*)
21May2020
BWR A4
(Downgrade/ISSUER NOT COOPERATING*)
NA
NA
Grand Total 22.06 (Rupees Twenty Two Crores and Six lakhs Only)
COMPLEXITY LEVELS OF THE INSTRUMENTS - NA

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

Soubhagya Ranjan Kahalsingh

Ratings Analyst Board : +91 80 4040 9940 soubhagya.rs@brickworkratings.com

Ramesh N

Associate Director - Ratings ramesh.n@brickworkratings.com
1-860-425-2742 | media@brickworkratings.com
Vamshi Rubber 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 State Bank Of India (SBI) Term LoanOut-standing 2.06 _ 2.06
2 State Bank Of India (SBI) Cash CreditSanctioned 17.00 _ 17.00
3 State Bank Of India (SBI) Bank GuaranteeSanctioned _ 3.00 3.00
Total 19.06 3.00 22.06
TOTAL (Rupees Twenty Two Crores and Six lakhs Only)
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