Brickwork Ratings reaffirms the ratings for the Bank Loan Facilities of Rs.24.00 Crs. of Bulktainer Shipping Ltd.
ParticularsFacilities** | Amount (Rs.Crs.) | Tenure | Rating# | ||
---|---|---|---|---|---|
Previous | Present | Previous (29 Jun 2020) |
Present | ||
Fund Based | 20.00 | 19.00 | Long Term |
BWR BBB- /Stable
Reaffirmation |
BWR BBB -
/Stable Reaffirmation |
Non Fund Based | 3.00 | 5.00 | Short Term |
BWR A3
Reaffirmation |
BWR A3
Reaffirmation |
Grand Total | 23.00 | 24.00 | (Rupees Twenty Four Crores Only) |
The rating draws strength from experience of the promoters, adequate liquidity position, satisfactory Interest Service Coverage Ratio, Debt Service Coverage Ratio and Net Cash Accruals to Total debt Ratio. The rating however is constrained by reduced Total Operating Income, impact of COVID 19 on the industry and competitive nature of industry..
BWR believes the business risk profile of Bulktainer Shipping Ltd. (BSL or the company) will be maintained over the medium term. The Stable outlook indicates a low likelihood of a rating change over the medium term.
KEY RATING DRIVERSCredit Strengths:
Management team is well educated and having sufficient experience in the industry. Mr. Animesh Sharma who is the managing director of the Company having 2 decades of an experience in the industry.
The Company's liquidity position is adequate. The Company is expected to generate Net Cash Accruals of Rs.23.86 Crs in FY22 and Rs. 24.36 Crs in FY23 against its Principal repayment of Rs.3.95 Crs in FY22 and Rs. 12.8 Crs in FY23. The Company is expecting adequate Current Ratio to be 1.90x as on 31st Mar 2022 and 1.95x as on 31st Mar 2023. Cash and cash equivalents were reported at Rs.2.02 Crs as on 31st Mar 2021. The Company has Fixed Deposit of Rs. 21.06 Crs in KBL as on 31st Mar 2021. Cash and Cash equivalents stood at Rs.2.02 Crs as on 31st Mar 2021.
Overall gearing of the company as indicated by Total Debt/TNW which has improved from 4.42x in FY19 to 2.78x in FY20 and 2.60x in FY21. TOL/TNW are also improved from 5.10x in FY19 to 3.20x in FY20 and then further improved to 2.74x in FY21 due to continuous reduction in Long Term Borrowings. During FY22, overall gearing as indicated by Total Debt/TNW and TOL/TNW is expected to remain stable as the company continues to repay its vehicle loans which has positive effects on Gearing Ratio.
The Company faces intense competition from large and small existing players.
Total Operating Income reduced to Rs.100.22 Crs in FY21 against Rs.134.82 Crs in FY20. Basically Bulktainer Shipping Ltd. (BSL) is working in 2 divisions which includes LPG Gas transportation and Bulk transportation. LPG gas comes under essential and hence the division was working regularly during the lockdown time. But, the Bulk transportation division was closed for 3 months in FY21. Due to this, the Operating Income has gone down in FY21.
For arriving at BSL’s rating, BWR has considered its standalone financial and business risk profile.
RATING SENSITIVITIES
Going forward, the ability of the company to improve its scale of operations by increasing the revenue growth, improve gearing by infusing own funds, manage working capital efficiency and prompt servicing of debt obligation shall remain key rating sensitivity.
Positive: If the Company manages to achieve its projections and improve the profitability margins as envisaged it would be positive for the ratings.
Negative: Deterioration in Total Operating Income and key financial indicators would be negative for the ratings.
LIQUIDITY INDICATORS - Adequate
The Company's liquidity position is adequate. The Company is expected to generate Net Cash Accruals of Rs.23.86 Crs in FY22 and Rs. 24.36 Crs in FY23 against its Principal repayment of Rs.3.95 Crs in FY22 and Rs. 12.8 Crs in FY23. The Company is expecting adequate Current Ratio to be 1.90x as on 31st Mar 2022 and 1.95x as on 31st Mar 2023. Cash and cash equivalents were reported at Rs.2.02 Crs as on 31st Mar 2021. The Company has Fixed Deposit of Rs. 21.06 Crs in KBL as on 31st Mar 2021. Cash and Cash equivalents stood at Rs.2.02 Crs as on 31st Mar 2021.
ABOUT THE ENTITYBulktainer Shipping Ltd.(BSL) was incorporated on 8th Nov 1995. Its registered office is located at Belapur in Mumbai. The company has branch offices located at Vadodara and Bargarh. Mr. Animesh Sharma and Mrs. Ramola Sharma are the Promoter Directors handling day to day operations of the company assisted by a team of technically qualified engineers and well experienced operation professionals. Animesh Sharma is the Managing Director (MD) of the company. BSL is engaged in surface logistics operations such as bulk handling of dry cargo such as Cement, Fly Ash, Alumina, and also engaged in transportation by road of Hydrocarbon Gases such as Butadiene 1.3, LPG and Butene. BSL is managed by highly qualified technocrats with vast experience in Surface Transportation.
KEY FINANCIAL INDICATORS (Standalone)Key Parameters | Units |
FY 20-21 (Provisional) |
FY 19-20 (Audited) |
---|---|---|---|
Operating Revenue | Rs.Crs. | 100.22 | 134.82 |
EBITDA | Rs.Crs. | 20.63 | 29.41 |
PAT | Rs.Crs. | 3.96 | 5.31 |
Tangible Net Worth | Rs.Crs. | 26.21 | 23.85 |
Total Debt/Tangible Net Worth | Times | 2.60 | 2.78 |
Current Ratio | Times | 2.00 | 1.29 |
ICRA B+(Stable)/A4 ISSUER NOT COOPERATING as on 20 Jan 2021.
RATING HISTORY FOR THE PREVIOUS THREE YEARS (including withdrawal and suspended)Facilities | Current Rating (2021) | 2020 | 2019 | 2018 | |||||
---|---|---|---|---|---|---|---|---|---|
Type | Tenure | Amount (Rs.Crs.) |
Rating | Date | Rating | Date | Rating | Date | Rating |
Fund Based | LT | 19.00 |
BWR BBB-/Stable
(Reaffirmation) |
29Jun2020 |
BWR BBB- Stable
(Reaffirmation) |
NA |
NA
|
31Dec2018 |
BWR BBB- Stable
(Upgrade) |
Non Fund Based | ST | 5.00 |
BWR A3
(Reaffirmation) |
29Jun2020 |
BWR A3
(Reaffirmation) |
NA |
NA
|
31Dec2018 |
BWR A3
(Upgrade) |
Grand Total | 24.00 | (Rupees Twenty Four Crores 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.
Analytical Contacts | |
---|---|
Dimple Nathalal Bhut Ratings Analyst Board : +91 80 4040 9940 dimple.b@brickworkratings.com |
Nagaraj K Associate Director - Ratings Board : +91 80 4040 9940 nagaraj.ks@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 | Karnataka Bank Ltd | Over DraftSanctioned | 19.00 | _ | 19.00 |
2 | Karnataka Bank Ltd | Bank GuaranteeSanctioned | _ | 5.00 | 5.00 |
Total | 19.00 | 5.00 | 24.00 | ||
TOTAL (Rupees Twenty Four Crores Only) |
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