RATING RATIONALE
02Dec2021

Ganadhi Pati Construction Pvt. Ltd.

Brickwork Ratings upgrades the long term ratings for the Bank Loan Facilities of Rs. 35.00 Crs. of Ganadhi Pati Construction Pvt. Ltd.

Particulars
Facilities** Amount (Rs.Crs.) Tenure Rating#
Previous Present Previous
(20 Dec 2020)
Present
Fund Based 3.25 3.25 Long Term BWR BB/Stable
Assignment
BWR BB + /Stable
Upgrade
Non Fund Based 31.75 31.75 Long Term BWR BB/Stable
Assignment
BWR BB + /Stable
Upgrade
Grand Total 35.00 35.00 (Rupees Thirty Five Crores 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


RATING ACTION / OUTLOOK

The upgrade in the rating of Ganadhi Pati Construction Private Limited factors in improvements in operating income and operating margins in FY21(Prov.), besides maintaining adequate debt protection metrics. The tangible net worth of the company has improved in FY21(Prov.). The rating continues to derive comfort from the extensive experience of more than three decades of the promoters in civil contractor industry. The rating outlook may be revised to 'Positive' in case the revenues and profit show more than expected figures. The rating is, however, constrained by the concentration risk, conversion cycle, stiff competition and other established players in the market.

KEY RATING DRIVERS

Credit Strengths:


Credit Risks:

ANALYTICAL APPROACH - Standalone

Rating Approach: BWR has used a standalone approach while arriving at the rating.

RATING SENSITIVITIES

Positive : BWR may revise the ratings upward, if the company executes the healthy order book with timely completion of the projects as per expected dates and secure new projects, accompanied by sustained rise in net revenue as projected. The rating may also be upgraded if the new capital is introduced as per the projections for next year.

Negative : The rating may be downgraded if there is a significant drop in the revenue from current FY21 level, further deterioration in liquidity profile and overall financial performance of the company.

LIQUIDITY INDICATORS - Adequate

The Company has a Cash & Bank balance of INR 1.72 Crs in FY21(Prov.) which have been increased from INR 0.49 Crs. in FY20. The current ratio of the company is 5.60x in FY21(Prov.) which is above the industry average.  The firm generated net cash accruals of Rs. 11.22 Crs in FY 21(Prov.) against CPLTD of Rs. 6.62 Crs in FY 21(Prov.) and the net cash accruals is projected to be Rs. 13.11 Crs in FY 22 against the CPLTD of Rs. 5.48 Crs in FY 22 indicating the availability of funds to meet its debt obligations. Hence, Overall liquidity is adequate. DSCR & ISCR has been  increased from 9.23X and 4.11X in FY20 to 18.06X and 5.47X in FY21(Prov.). The average utilization of OD limit is 25% and 10-30% for Union Bank of India & ICICI Bank respectively.

ABOUT THE ENTITY

Incorporated in 1998, Ganadhi Pati Construction Pvt. Ltd. (GCPL) is a private company limited by shares, with its head office in Patna, Bihar. The company is a civil contractor to the government in Eastern India providing all civil & mechanical solutions and construction activities related to water supply with projects running across Bihar, Jharkhand and West Bengal. The promoter of GCPL, Mr. Janardan Prasad, is also the proprietor of J.P. Enterprises, involved in the same line of business activities in Bihar and Jharkhand since 1982.

KEY FINANCIAL INDICATORS (Standalone)
Key Parameters Units FY 19-20
(Audited)
FY 18-19
(Audited)
Operating Revenue Rs.Crs. 119.94 73.64
EBITDA Rs.Crs. 15.20 6.10
PAT Rs.Crs. 9.79 4.50
Tangible Net Worth Rs.Crs. 19.81 9.97
Total Debt/Tangible Net Worth Times 0.72 1.28
Current Ratio Times 4.17 1.11
KEY COVENANTS OF THE FACILITY RATED

NA


NON-COOPERATION WITH PREVIOUS CREDIT RATING AGENCY

INC from ICRA  on 31 May 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 3.25
BWR BB+/Stable
(Upgrade)
20Dec2020
BWR BBStable
(Assignment)
NA
NA
NA
NA
Non Fund Based LT 31.75
BWR BB+/Stable
(Upgrade)
20Dec2020
BWR BBStable
(Assignment)
NA
NA
NA
NA
Grand Total 35.00 (Rupees Thirty Five Crores 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

Kartik Arora

Ratings Analyst kartik.a@brickworkratings.com

Hari Kishan Yadav

Associate Director - Ratings hari.ky@brickworkratings.com
1-860-425-2742 | media@brickworkratings.com
Ganadhi Pati Construction 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 ICICI Bank Secured Overdraft against HypothecationSanctioned 1.25 _ 1.25
2 ICICI Bank Bank GuaranteeSanctioned 3.75 _ 3.75
3 Union Bank of India Bank GuaranteeSanctioned 28.00 _ 28.00
4 Union Bank of India Secured Overdraft against HypothecationSanctioned 2.00 _ 2.00
Total 35.00 0.00 35.00
TOTAL (Rupees Thirty Five Crores Only)
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