RATING RATIONALE
30Mar2023

Conifer Industries Pvt. Ltd.

Brickwork Ratings reaffirms the ratings for the Bank Loan Facilities of Rs. 54.20 Crs. of Conifer Industries Pvt. Ltd.

Particulars
Facilities** Amount (Rs.Crs.) Tenure Rating#
Previous Present Previous
(02 Jan 2023)
Present
Fund Based 53.94 49.20 Long Term BWR BBB- /Stable
Reaffirmation/ISSUER NOT COOPERATING*
BWR BBB - /Stable
removal from ISSUER NOT COOPERATING* category/Reaffirmed
Non Fund Based 5.00 5.00 Short Term BWR A3
Reaffirmation/ISSUER NOT COOPERATING*
BWR A3
removal from ISSUER NOT COOPERATING* category/Reaffirmed
Grand Total 58.94 54.20 (Rupees Fifty Four Crores and Twenty 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
Note: *Issuer did not cooperate; based on best available information.


RATING ACTION / OUTLOOK

Brickwork ratings reaffirms the long term rating to BWR BBB/stable/ and reaffirms short-term rating to A3 of Conifer Industries Pvt Ltd. BWR took up with the issuer to provide required information over emails and through telephonic communication. The entity has provided the complete information. As we have received the FY22 financials, Satisfactory Banker Feedback Hence reaffirmed the rating and removes it from Issuer not coperating category.

KEY RATING DRIVERS

Credit Strengths:


Credit Risks:

ANALYTICAL APPROACH - Standalone

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). BWR has principally relied upon the standalone audited financials up to FY22, publicly available information and clarification/information provided by the Company.

RATING SENSITIVITIES

Positive: 

Negative: 

LIQUIDITY INDICATORS - Adequate

Net cash accruals in FY 22 is at Rs.23.20 crs and a net cash accrual to total debt has improved significantly to 0.8 as at FY22 as compared at 0.32 as at FY21

The current ratio is comfortable at 2.73 times as on 31st March 2022. Further, the Company’s average working capital limit utilization stood at around 18 percent.

ISCR ratio improved to 8.83 times for FY 2022 as against 6.64 times in FY 2021. Further, the DSCR stood at 2.05 times for FY2022 as against 1.5 times in FY 2021. The improvement in the coverage indicators are on account of improvement in profit and decline in annual debt repayment. The rise in the prices of cotton yarn also played a significant part in the improvement of coverage indicators during FY22. 

ABOUT THE ENTITY

Conifer Industries Private Limited was incorporated in the year 2013 with a registered office located in Kolkata, West Bengal by Kolkata based Maskara family. The Company has set-up a spinning unit in Ahmedabad, Gujarat and commenced its operations in November 2016. The Company is engaged in spinning cotton yarn with a count between 30s to 40s of different varieties i.e. carded, combed and compact yarn mainly used for manufacturing fabrics for Shirt & Suitings. The Company has a total installed capacity of 25,536 spindles for manufacturing 5,300 tonnes of cotton yarn per year. The average capacity utilisation was around 72 percent during FY 2021-22. The key raw material required is cotton and mainly procured from ginning units and traders mainly located in Gujarat. The Company mainly caters to fabric manufacturing companies and traders located in Gujarat, Rajasthan and Uttar Pradesh. The Company is also engaged in deemed export which constitutes around 50% of total sales. The Company is part of the Mahabir group engaged in manufacturing jute and synthetic spun yarn. However, apart from the common management CIPL does not have any intercompany transactions with Mahabir group companies.The cotton yarn proces withnessed a substantial rise due to pent up demand during FY22.However sustainibility is to be ascertained.

 

KEY FINANCIAL INDICATORS (Standalone)
Key Parameters Units FY 21-22
(Audited)
FY 20-21
(Audited)
FY 22-23
(Audited - Midterm_Annual)
Operating Revenue Rs.Crs. 177.11 93.99 Not Available
EBITDA Rs.Crs. 29.31 16.05 Not Available
PAT Rs.Crs. 13.37 2.88 Not Available
Tangible Net Worth Rs.Crs. 34.30 23.74 Not Available
Total Debt/TNW Times 1.15 2.05 Not Available
Current Ratio Times 2.73 2.21 Not Available
KEY COVENANTS OF THE FACILITY RATED

The terms of sanction include standard covenants normally stipulated for such facilities.


STATUS OF NON-COOPERATION WITH PREVIOUS CRA

 Not Applicable

ANY OTHER INFORMATION

Not Applicable

RATING HISTORY FOR THE PREVIOUS THREE YEARS (including withdrawal and suspended)
Facilities Current Rating (2023) 2023 (History) 2022 2021 2020
Type Tenure Amount
(Rs.Crs.)
Rating Date Rating Date Rating Date Rating Date Rating
Fund Based LT 49.20
BWR BBB-/Stable
(removal from ISSUER NOT COOPERATING* category/Reaffirmed)
02Jan2023
BWR BBB- Stable
(Reaffirmation/ISSUER NOT COOPERATING*)
NA
NA
01Oct2021
BWR BBB- Stable
(Reaffirmation and change in Outlook)
15Jun2020
BWR BBB- Negative
(Reaffirmation)
Fund Based ST 0.00
NA
02Jan2023
BWR A3
(Reaffirmation/ISSUER NOT COOPERATING*)
NA
NA
NA
NA
NA
NA
FB SubLimit ST NA
NA
02Jan2023
BWR A3
(Reaffirmation/ISSUER NOT COOPERATING*)
NA
NA
01Oct2021
BWR A3
(Reaffirmation)
15Jun2020
BWR A3
(Reaffirmation)
Non Fund Based ST 5.00
BWR A3
(removal from ISSUER NOT COOPERATING* category/Reaffirmed)
02Jan2023
BWR A3
(Reaffirmation/ISSUER NOT COOPERATING*)
NA
NA
01Oct2021
BWR A3
(Reaffirmation)
15Jun2020
BWR A3
(Reaffirmation)
Grand Total 54.20 (Rupees Fifty Four Crores and Twenty lakhs Only)
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

Himanshu Seth

Rating Analyst himanshu.s@brickworkratings.com

Vidya Shankar

Principal Director - Ratings Board : +91 80 4040 9940 vidyashankar@brickworkratings.com
1-860-425-2742 | media@brickworkratings.com
Conifer Industries Pvt. 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 Central Bank of India Term LoanSanctioned 4.75 _ 4.75
2 Central Bank of India Cash CreditSanctioned 5.00 _ 5.00
3 Central Bank of India Bank GuaranteeSanctioned _ 1.00 1.00
4 Punjab National Bank Bank GuaranteeSanctioned _ 4.00 4.00
5 Punjab National Bank Cash CreditSanctioned 8.50 _ 8.50
6 Punjab National Bank Term LoanSanctioned 24.60 _ 24.60
7 Punjab National Bank Term LoanSanctioned 6.35 _ 6.35
Total 49.20 5.00 54.20
TOTAL (Rupees Fifty Four Crores and Twenty lakhs Only)
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