Brickwork Ratings downgrades / reaffirms the ratings for the Bank Loan Facilities of Rs. 311.97 Crs. of Aarvee Denims and Exports Ltd. based on best available information, as the issuer did not cooperate.
ParticularsFacilities** | Amount (Rs.Crs.) | Tenure | Rating# | ||
---|---|---|---|---|---|
Previous | Present | Previous (01 Sep 2021) |
Present | ||
Fund Based | 292.68 | 292.68 | Long Term |
BWR B+ /Stable
Reaffirmation |
BWR B
/Stable ISSUER NOT COOPERATING* /Downgrade |
Non Fund Based | 19.29 | 19.29 | Short Term |
BWR A4
Reaffirmation |
BWR A4
ISSUER NOT COOPERATING* /Reaffirmation |
Grand Total | 311.97 | 311.97 | (Rupees Three Hundred Eleven Crores and Ninety Seven lakhs Only) |
The rating was due for review in September-2022. The financial information is available with BWR, as the company is listed on BSE. However, other business related information is not available due to management non cooperation. BWR took up with the issuer to provide required information in timely manner over the emails and through telephone calls. Despite the best efforts of BWR to get at least the minimum required information for a review, the entity has not provided the same. On account of non availability of adequate information/ irregular submission of NDS, BWR is unable to assess the Company’s overall performance and its ability to service its debt and maintain a valid rating. Hence on account of inadequate information and lack of management cooperation, Brickworks Ratings downgraded the long term bank loan rating to BWR B (Stable) / reaffirms the short term rating to BWR A4 and migrating to 'Issuer Not Cooperating' category.
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 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 withholdings of the information required for a review of the rating.
ABOUT THE ENTITYAarvee Denims and Exports Limited (ADEL) is a listed Public Limited Company having composite integrated manufacturing facilities for manufacturing of a wide range of Denim Fabrics with present installed capacity of around 85 Million Mtrs. of Denim Fabrics. ADEL has in-house yarn manufacturing facilities for denim, used for captive consumption. The company has a cotton yarn manufacturing capacity of 39,000 MTPA. The company also sources yarn from local markets for a variety of denim products. It sells surplus yarn in the local market.
ADEL has three operating plants, first in Vijay Farm, Narol having one Integrated Spinning/ Weaving/ Processing Division and second in Narol having one Weaving/ Processing Division and third in Matoda having one Spinning Division. Apart from that the Company is having 5 windmill for captive purpose located in Kutch.
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 (2022) | 2021 | 2020 | 2019 | |||||
---|---|---|---|---|---|---|---|---|---|
Type | Tenure | Amount (Rs.Crs.) |
Rating | Date | Rating | Date | Rating | Date | Rating |
Fund Based | LT | 292.68 |
BWR B/Stable
(ISSUER NOT COOPERATING* /Downgrade) |
25Aug2021 |
BWR BWR B+Stable
(Reaffirmation) |
20Oct2020 |
BWR BWR B+Credit watch with negative implication
(Downgraded) |
17Oct2019 |
BWR BWR BBBNegative
(Downgraded) |
0.00 |
NA
|
05Jul2021 |
BWR BWR B+/INCStable
(Reaffirmation) |
27Feb2020 |
BWR BWR BBNegative
(Downgraded) |
NA |
NA
|
||
0.00 |
NA
|
05Apr2021 |
BWR BWR B+Credit Watch with Negative Implications
(Reaffirmation) |
NA |
NA
|
NA |
NA
|
||
0.00 |
NA
|
01Sep2021 |
BWR B+ Stable
(Reaffirmation) |
NA |
NA
|
NA |
NA
|
||
Non Fund Based | ST | 19.29 |
BWR A4
(ISSUER NOT COOPERATING* /Reaffirmation) |
25Aug2021 |
BWR BWR A4
(Reaffirmation) |
20Oct2020 |
BWR BWR A4
(Reaffirmed) |
17Oct2019 |
BWR BWR A3+
(Downgraded) |
0.00 |
NA
|
05Jul2021 |
BWR BWR A4
(Reaffirmation) |
27Feb2020 |
BWR BWR A4
(Downgraded) |
NA |
NA
|
||
0.00 |
NA
|
05Apr2021 |
BWR BWR A4
(Reaffirmation) |
NA |
NA
|
NA |
NA
|
||
0.00 |
NA
|
01Sep2021 |
BWR A4
(Reaffirmation) |
NA |
NA
|
NA |
NA
|
||
Grand Total | 311.97 | (Rupees Three Hundred Eleven Crores and Ninety Seven 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.
Hyperlink/Reference to applicable CriteriaAnalytical Contacts | |
---|---|
Kunjal Dabhi Rating Analyst Board : +91 79 66174046 / 47 kunjal.r@brickworkratings.com |
Vidya Shankar Principal Director - Ratings Board : +91 80 4040 9940 vidyashankar@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.) | |
---|---|---|---|---|---|---|
1 | Bank of Baroda | Corporate LoanSanctioned | _ | _ | 0.00 | |
2 | Bank of Baroda | Cash CreditSanctioned | 65.28 | _ | 65.28 | |
3 | Bank of Baroda | Bank GuaranteeSanctioned | _ | 8.00 | 8.00 | |
4 | Bank of Baroda | Emergency Credit Line Guarantee Scheme (ECLGS)Sanctioned | 16.45 | _ | 16.45 | |
5 | Bank of India | Emergency Credit Line Guarantee Scheme (ECLGS)Sanctioned | 5.17 | _ | 5.17 | |
6 | Bank of India | Bank GuaranteeSanctioned | _ | 3.50 | 3.50 | |
7 | Bank of India | Cash CreditSanctioned | 21.50 | _ | 21.50 | |
8 | Standard Chartered Bank | Term LoanSanctioned | 23.65 | _ | 23.65 | |
9 | Standard Chartered Bank | Cash CreditSanctioned | 50.12 | _ | 50.12 | |
10 | Standard Chartered Bank | Bank GuaranteeSanctioned | _ | _ | 0.00 | |
11 | Standard Chartered Bank | Emergency Credit Line Guarantee Scheme (ECLGS)Sanctioned | 12.75 | _ | 12.75 | |
12 | State Bank Of India (SBI) | Emergency Credit Line Guarantee Scheme (ECLGS)Sanctioned | 13.98 | _ | 13.98 | |
13 | State Bank Of India (SBI) | Bank GuaranteeSanctioned | _ | 2.19 | 2.19 | |
14 | State Bank Of India (SBI) | Cash CreditSanctioned | 54.40 | _ | 54.40 | |
15 | TATA Capital Financial Services Limited | Term LoanSanctioned | 1.41 | _ | 1.41 | |
16 | TATA Capital Financial Services Limited | Emergency Credit Line Guarantee Scheme (ECLGS)Sanctioned | 0.64 | _ | 0.64 | |
17 | Yes Bank | Cash CreditSanctioned | 18.96 | _ | 18.96 | |
18 | Yes Bank | Term LoanSanctioned | 3.21 | _ | 3.21 | |
19 | Yes Bank | Bank GuaranteeSanctioned | _ | 5.60 | 5.60 | |
20 | Yes Bank | Emergency Credit Line Guarantee Scheme (ECLGS)Sanctioned | 5.16 | _ | 5.16 | |
Total | 292.68 | 19.29 | 311.97 | |||
TOTAL (Rupees Three Hundred Eleven Crores and Ninety Seven lakhs Only) |
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