RATING RATIONALE
27Jul2026
EAST PHARMA TECHNOLOGIES
Brickwork Ratings assigns the ratings for the Bank Loan Facilities of Rs. 67.77 Crs. of EAST PHARMA TECHNOLOGIES
Particulars| Facilities** | Amount(Rs.Crs.) | Tenure | Rating# | |
|---|---|---|---|---|
| Fund Based | 66.77 | Long Term |
BWR BBB -
/Stable Assignment |
|
| (10.00) | ||||
| Non Fund Based | 1.00 | Short Term |
BWR A3
Assignment |
|
| (10.00) | ||||
| Grand Total | 67.77 | (Rupees Sixty Seven Crores and Seventy Seven lakhs Only) | ||
**Details of Bank Loan facilities,consolidation or instruments are provided in Annexure RATING ACTION / OUTLOOK
Brickwork Ratings has assigned a long-term rating of BWR BBB-/Stable and a short-term rating of BWR A3 to the bank loan facilities of Rs.67.77 Crores of East Pharma Technologies Firm.
The rating factors in the partners' extensive industry experience and net worth, secured revenue streams via long-term relationships, strong credit profiles of major revenue drivers, and a moderate financial risk profile. However, the rating is constrained by intense competition, partnership constitution risk due to the inherent risk of partners potentially withdrawing capital during personal contingencies, and stagnant revenue growth. Going forward, the company's ability to enhance its revenue profile and strengthen its financial risk profile will be key factors influencing the rating.
The rating outlook has been assigned as "Stable" as BWR believes that East Pharma Technologies Firm's business risk profile will be maintained over the medium term. The 'Stable' outlook indicates a low likelihood of rating change over the medium term. The rating outlook may be revised to 'Positive' in case the revenue and profitability margins show sustained improvement. The rating outlook may be revised to 'Negative' if the financial risk profile goes down.
KEY RATING DRIVERSCredit Strengths:
-
1) Management Experience & Networth of the partners: :
The firm was established by partners who bring extensive industry experience. Mrs. Pinaka Suneela Rani, aged about 68 years, has around 20 years of experience, and Mrs. Mettu Srivani, aged about 60 years, has around 11 years of experience. The partners' deep expertise has been instrumental in driving the firm's success and business growth.
The firm benefits from the excellent financial backing of its owners. The partner's combined individual net worth is around Rs.733.02 Cr. Mrs. P. Suneela Rani is the ultimate beneficial owner of a 29.32% shareholding in Aurobindo Pharma Limited, held through various trusts and firms. Aurobindo Pharma Limited has a bank loan rating of "IND AA+/Stable /IND A1+" for bank loan ratings amounting to Rs. 6493 Crores, as per India Ratings & Research Private Limited on 10 June 2026. Holding such a major stake in a well-established, large-scale company like Aurobindo Pharma reflects the promoter's strong financial standing and provides great comfort regarding the company’s overall stability and backing.
In the event of any shortage of funds, the partners have a strong net worth to support their working capital requirements.
-
Secured Revenue Streams via Long-Term Partnerships & Strong Credit Profile of Major Revenue Drivers: :
Approximately 90% of the company’s revenue is derived from just three customers: Pravesha Industries Pvt. Ltd., Eugia Pharma Specialities Ltd., and Aurobindo Pharma Ltd. While this indicates a high level of customer concentration risk, several mitigating factors ensure long-term stability:
- Established Relationships: The firm has maintained a strong relationship with Aurobindo Pharma Ltd. since commencing commercial operations. Additionally, Ms. Pinaka Suneela Rani is a shareholder in Aurobindo Pharma Ltd. The firm has also been supplying products to the other two key customers for the past five to six years.
- High Switching Costs: Because these specialized pharmaceutical products are highly customized and approved by stringent regulatory bodies like the FDA, replacing suppliers is a difficult, time-consuming process. This creates a highly interdependent relationship that ensures long-term stability for the firm.
Furthermore, the financial robustness of these clients underscores the firm's business sustainability: Aurobindo Pharma generated approximately Rs. 11,000 crores in revenue for FY2026 and has a bank loan rating of "IND AA+/Stable /IND A1+" for bank loan ratings amounting to Rs. 6493 Crores, as per India Ratings & Research Private Limited on 10 June 2026. While Eugia Pharma Specialities Ltd. has a bank loan rating of "IND AA/Stable /IND A1+" for bank loan ratings amounting to Rs. 825.00 Crores, as per India Ratings & Research Private Limited on December 1, 2025. Pravesha Industries Pvt. Ltd. has a bank loan rating of "CARE A+/Stable / CARE A1" for bank loan facilities totaling Rs. 95.00 Crores, according to CARE Ratings on February 10, 2026. The excellent credit ratings and substantial financial scale of these counterparties reflect a highly secure credit and business profile for the firm's primary revenue drivers.
-
Moderate Financial Risk Profile: :
The firm demonstrates a moderate financial profile characterized by stable revenue generation, superior profitability, and strong debt-servicing metrics. Operating revenue has consistently remained above the Rs. 60 Cr threshold, posting Rs. 63.13 Cr in FY2025 and an adequate Rs. 61.78 Cr as per FY2026 provisional financials. Core operational efficiency is underscored by strong and stable profitability, with an OPBDIT of Rs. 16.66 Cr (26.39% margin) in FY2025 and Rs. 16.24 Cr (26.29% margin) in FY2026.
The firm's capital base remains healthy, with a tangible net worth of Rs. 36.03 Cr providing a solid financial cushion. While the Total Debt/TNW and TOL/TNW ratios rose from a moderate 0.90x and 1.15x in FY2025 to 1.60x and 1.82x in FY2026, this increase was strategically driven by the availment of new term loans and working capital facilities from Kotak Mahindra Bank to fund productive capex and business growth. Crucially, this additional leverage is fully supported by the firm's strong debt-servicing capabilities and comfortable liquidity position. The firm generated comfortable net cash accruals of Rs. 13.38 Cr in FY2026 against a CPLTD of Rs. 4.56 Cr, and the net cash accruals are expected to grow even further to Rs. 17.26 Cr in the next year against a CPLTD of Rs. 10.17 Cr. Debt protection metrics are robust, as evidenced by an ISCR of 5.68x and a DSCR of 2.37x in FY2026. Furthermore, short-term liquidity is well-maintained with a healthy current ratio of 1.62x and substantial unutilized banking lines, reflected in a highly conservative average working capital utilization of just 21.89%, ensuring significant financial flexibility.
-
Installation of new manufacturing unit 3: :
The company is significantly strengthening its business by setting up a third manufacturing plant (Unit 3) in Jedcherla, near Hyderabad. This factory will allow the company to make new products like laminates, aluminum tubes, and packaging sachets (for popular brands like ENO and Electral). This move helps the company enter new markets and reduces its reliance on existing products. The project is moving ahead of schedule. While final machinery setup is expected by December 2026, management plans to start commercial production early, in September 2026. This advanced timeline is expected to yield immediate top-line benefits.
-
Constitution Risk: :
since it is a partnership firm, it is exposed to the inherent risk of partners potentially withdrawing their capital during personal contingencies. Additionally, partnership firms often face challenges in raising large amounts of capital, as they cannot issue shares to the public and have limited access to external funding sources compared to corporations. This lack of financial resources can hinder the firm’s ability to invest in expansion, innovation, or infrastructure, which may limit its long-term growth potential. In a partnership, decision-making is generally shared among the partners. However, differences in personal goals, management styles, or financial interests can often lead to conflicts of interest.
-
Stagnant Revenue vs. Debt Concerns :
Even though the company keeps its annual sales above Rs. 60 Cr, making Rs. 63.13 Cr in FY2025 and a provisional Rs. 61.78 Cr in FY2026, its revenue has not grown at all for the last three years. This lack of growth is a major concern because the company's business relies on selling items in huge quantities. Over the years, they expanded their catalog from just making "Safe seals" for medicine bottles to selling a wide variety of other products, including droppers, measuring cups, and sterilization pouches. However, even though the company added all these new products, its total sales have been stuck at the same level for three years. This shows they need better business planning and a stronger push into the market to grow into a bigger company. This stagnant revenue becomes a crucial credit consideration when weighed against the firm’s heavy debt structure. The firm has availed Rs. 60 Crore in term loans from Kotak Mahindra Bank, with total debt standing at Rs. 57.71 Cr in FY2026. Because the total debt is nearly equal to the annual revenue of Rs. 61.78 Cr, the firm's current revenue scale remains relatively low to comfortably service this level of leverage, making future growth essential to ease financial pressure.
For arriving at its ratings, BWR has considered the standalone approach for the company. BWR has applied its rating methodology as detailed in the rating criteria.
RATING SENSITIVITIES
Going forward, the ability of the company to improve its revenue and financial risk profile would remain the key rating sensitivities.
Positive:
- Improvement in topline revenue by 20% and supported by sustained operating margin with an improvement in the cash accruals.
- Improvement in gearing ratios through profit retention
- Corporatization of the entity.
Negative:
- A decline of 20% in revenue, with EBITDA margin dropping below 12%, and a substantial reduction in cash accruals.
- Weakening debt protection metrics, particularly a DSCR falling below 1.25x.
Liquidity is marked by strong accruals against negligible repayment obligations and liquid investments to the tune of Rs. 5.51 Crore. With a gearing of 1.60 times as of March 31, 2026, the issuer has sufficient gearing headroom, raising additional debt for its capex. Its unutilized bank lines are more than adequate to meet its incremental working capital needs over the next one year.
The company had net cash accruals of Rs. 13.38 Cr as against a CPLTD of Rs. 4.56 Cr in FY2026. It projects net cash accruals of Rs. 17.26 Cr, with CPLTD of Rs. 10.17 Cr in FY2027. Short-term liquidity is well-maintained with a healthy current ratio of 1.62x and substantial unutilized banking lines, reflected in a highly conservative average working capital utilization of just 21.89%, ensuring significant financial flexibility. The firm has a tangible net worth (TNW) of Rs. 36.03 Cr as per FY2026 provisional financials. And the Total Debt/TNW ratio stood at 1.60 times. ISCR and DSCR stood at 5.68 times and 2.37 times, respectively, in FY2026. Furthermore, the liquidity is further supported by the partner's combined strong individual net worth of around Rs.733.02 Cr.
ABOUT THE ENTITY| Macro Economic Indicator | Sector | Industry | Basic Industry |
|---|---|---|---|
| Healthcare | Healthcare | Healthcare Equipment & Supplies | Medical Equipment & Supplies |
East Pharma Technologies is a partnership firm established in the year 2015 and located in Hyderabad, Telangana. Initially, the firm was involved in the manufacturing of high-quality ‘Safe seals’ for sealing injectable bottles. Later, several other products were added in a phased manner: viz., WAD, Master batch, Droppers, Spools, Blister, Plastic Strip seals, Measuring cups, Sterilization Pouch, Ropp caps, etc. The firm has three manufacturing units. Manufacturing Plants 1 & 2 are located in leased premises from TSIIC (Telangana State Industrial Infrastructure Corporation) at Pashamylaram, Sangareddy District, Telangana. Manufacturing unit 3 was implemented recently in Green Industrial Park (a major industrial & pharmaceutical hub developed by TGIIC) located at Jedcherla, about 90 km from Hyderabad.
Mrs. Pinaka Suneela Rani and Mrs.Mettu Srivani are the partners of the Firm.
ESG ProfileThe company demonstrates an adequate ESG profile based on its environmental, social, and governance practices.
Environmental: Performance is evaluated based on carbon emissions, energy and water consumption, waste management, and the adoption of clean energy technologies (like solar and wind).
Social: The focus is on workplace safety, workforce diversity, employee wel-being, and gender-sensitive safety measures at field sites.
Governance: Strength is measured by board independence, committee effectiveness (audit/ESG), the separation of the Chair and CEO roles, and strong risk management and compliance systems.
KEY FINANCIAL INDICATORS (Standalone)| Key Parameters | Units |
FY 23 - 24 (Audited - Annual) |
FY 24 - 25 (Audited - Annual) |
FY 25 - 26 (Provisional - Annual) |
|---|---|---|---|---|
| Operating Revenue | Rs.Crs. | 64.57 | 63.13 | 61.78 |
| EBITDA | Rs.Crs. | 17.72 | 16.66 | 16.24 |
| PAT | Rs.Crs. | 7.75 | 7.53 | 2.81 |
| Tangible Net Worth | Rs.Crs. | 30.07 | 32.72 | 36.03 |
| Total Debt / Tangible Net Worth | Times | 0.14 | 0.90 | 1.60 |
| Current Ratio | Times | 2.05 | 3.46 | 1.62 |
The terms of sanction include covenants normaly stipulated for such facilities.
STATUS OF NON-COOPERATION WITH PREVIOUS CRA
Not Applicable
RATING HISTORY FOR LAST THREE YEARS (including withdrawal and suspended)| Facilities | Current Rating (2026) | 2025 | 2024 | 2023 | |||||
|---|---|---|---|---|---|---|---|---|---|
| Type | Tenure | Amount (Rs.Crs.) |
Rating | Date | Rating | Date | Rating | Date | Rating |
| Fund Based | LT | 66.77 |
BWR BBB-/Stable
(Assignment) |
NA |
NA
|
NA |
NA
|
NA |
NA
|
| FB SubLimit | LT | (10.00) |
BWR BBB-/Stable
(Assignment) |
NA |
NA
|
NA |
NA
|
NA |
NA
|
| Non Fund Based | ST | 1.00 |
BWR A3
(Assignment) |
NA |
NA
|
NA |
NA
|
NA |
NA
|
| NFB SubLimit | ST | (10.00) |
BWR A3
(Assignment) |
NA |
NA
|
NA |
NA
|
NA |
NA
|
| Grand Total | 67.77 | (Rupees Sixty Seven Crores and Seventy Seven lakhs Only) | |||||||
| Analytical Contacts | |
|---|---|
|
Krishnappa Murugesh Ratings Analyst krishnappa.m@brickworkratings.com |
Sabitha M Nayak Associate Director-Ratings sabitha.nayak@brickworkratings.com |
| Media Contact | media@brickworkratings.com | Client Support | clientsupport@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 | Kotak Mahindra Bank | Term LoanOut-standing | 31.77 | _ | 31.77 | Simple## |
| 2 | Kotak Mahindra Bank | Term LoanSanctioned | 25.00 | _ | 25.00 | Simple## |
| Sub-Limit (Capex LC) Sanctioned | (10.00) | |||||
| 3 | Kotak Mahindra Bank | Forward ContractSanctioned | _ | 1.00 | 1.00 | Simple## |
| 4 | Kotak Mahindra Bank | Working Capital Demand LoanSanctioned | 10.00 | _ | 10.00 | Simple## |
| Sub-Limit (Cash Credit ) Sanctioned | (10.00) | |||||
| Total | 66.77 | 1.00 | 67.77 | |||
| TOTAL (Rupees Sixty Seven Crores and Seventy 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.
| 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 |
| Instrument / Activity | Regulator |
|---|---|
| Listed/Proposed to be listed bonds/debentures/preference share (all securities) | SEBI |
| Unlisted/Proposed to be unlisted Bonds/Debentures/ Preference share (all securities) | MCA |
Listed PTCs / Securitisation Notes (originated by entities regulated by RBI) 1| SEBI | |
Listed PTCs / Securitisation Notes (originated by entities not regulated by RBI) 1| SEBI | |
Unlisted PTCs / Securitisation Notes (originated by entities regulated by RBI) 1| RBI | |
| Listed Commercial Paper and NCDs with original maturity less than 1 year | RBI |
| Unlisted Commercial Paper and NCDs with original maturity less than 1 year | RBI |
Loan Facilities (Fund/Non-Fund Based) from Bank/NBFCs/NHB/FIs 2| RBI | |
| External Commercial Borrowings and other similar borrowings | RBI |
| Certificates of Deposit | RBI |
| Fixed Deposits raised by NBFC's, Banks, HFCs, Fis | RBI |
| Fixed Deposits raised by corporates other than NBFCs, Banks, HFCs, Fis | MCA |
| Inter Corporate Deposits/Loans extended by Corporates | MCA |
Borrowing programme 3| - | |
Issuer Ratings 4| - | |
| Credit Ratings for Capital Protection Oriented Schemes (by Mutal Funds and AIFs) | SEBI |
| Credit quality ratings (CQRs) for Mutual Fund Schemes and Schemes of AIFs | SEBI |
| Listed Security Receipts | SEBI |
| Unlisted Security Receipts | RBI |
| Independent Credit Evaluation (ICE) | RBI |
| Expected Loss Ratings (for Loan Facilities (Fund/Non-Fund Based) from Bank/NBFCs/NHB/Fis) | RBI |
| Expected Loss Ratings (Listed/Proposed to be listed bonds/debentures/preference share (all securities)) | SEBI |
| Expected Loss Ratings (Unlisted/Proposed to be unlisted Bonds/Debentures/ Preference share (all securities)) | MCA |
Unlisted PTCs / Securitisation Notes (originated by entities not regulated by RBI) 1| Investor-side Regulator | such as IRDAI, PFRDA 5 |
| Monitoring Agency | SEBI |
| Research activities, incidental to rating, such as research for Economy, Industries and Companies 6 | NA |
- Includes securitisation transactions involving assignee payout, acquirer's payout.
- Includes bank facilities such as liquidity facility, second loss facility that are part of securitisation transactions.
- The rated instrument may involve issuance of different instruments such as debt securities (listed or otherwise), bank loans, commercial paper (listed or otherwise), etc. The regulator of the instrument may accordingly be SEBI, RBI or MCA and can only be determined upon issuance. In PRs subsequent to issuance(s), BWR shall separately capture the rated quantum details along with names of respective regulators.
- There is no instrument being rated and hence, Regulator of the Instrument is not applicable.
- These ratings were assigned during regulatory regime prior to the introduction of SEBI CRA Circular dated Feb 10, 2026, and accordingly, investor side regulators have been included.
- Permitted by SEBI vide SEBI Master Circular for CRAs
For any grievances relating to rating of instruments regulated by other FSR (Financial Sector Regulators), please contact grievance@brickworkratings.com.
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