RATING RATIONALE
18Jan2022

Mantra Softech (I) Pvt. Ltd

Brickwork Ratings upgrades the ratings for the Bank Loan Facilities of Rs. 49.50 Crs. of Mantra Softech (I) Pvt. Ltd

Particulars
Facilities** Amount (Rs.Crs.) Tenure Rating#
Previous Present Previous
(21 Dec 2021)
Present
Fund Based 16.00 16.00 Long Term BWR BB+ /Stable
Downgrade/ISSUER NOT COOPERATING*
BWR BBB /Stable
Upgrade
(14.50) (14.50)
(5.00) (5.00)
(5.00) (5.00)
Non Fund Based 33.50 33.50 Short Term BWR A4
Downgrade/ISSUER NOT COOPERATING*
BWR A3
Upgrade
(14.50) (14.50)
(10.00) (10.00)
Grand Total 49.50 49.50 (Rupees Forty Nine Crores and Fifty 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


RATING ACTION / OUTLOOK

BWR has essentially relied on Audited financials upto FY21, projected financials upto FY23, publicly available information and information & clarifications provided by management. The rating draws comfort from experienced promoters, above average financial risk profile and reputed and established clientele. However, the rating is constrained by working capital intensive nature of business, and revenue vulnerability to fluctuation in order flow. BWR believes that Mantra Softech (I) Pvt Ltd business risk profile will be maintained over the medium term. The 'Stable' outlook indicates a low likelihood of rating change over the medium term.

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).

RATING SENSITIVITIES

Going forward the ability of the company to achieve projected revenue, to improve scale of operations, to improve capital structure and maintaining overall financial risk profile will be the key rating sensitivities.

Positive: The rating outlook may be revised to positive if the company is able to achieve the projected revenue, improve its scale of operations and capital structure.

Negative: The rating outlook may be revised to negative if there is decline in revenue and profit margin, stretched working capital cycle or any deterioration in the financial risk profile.

LIQUIDITY INDICATORS - Adequate

Liquidity position of the company is at adequate level reflected by a current ratio of 2.29 times in FY 21. Net cash accruals against total debt of the company stands at 1.50x as on 31 Mar 2021. Net cash accrual of Rs 21.89 crs is sufficient against CPLTD of Rs 0.57 crs in FY21. Cash and cash equivalents remains Rs 1.20 crs in FY21. The profit margins has also shown substantial improvement as OPM stands comfortable at 15.29% in FY21 and NPM as 9.47% in FY21.

ABOUT THE ENTITY

MSIPL was set up in 2006, by the promoters, Mr Hiren Bhandari and Mr Bhavyen Bhandari. The Ahmedabad-based company manufactures various security, surveillance, and tracking products such as biometrics, automated fingerprint identification system, access control, and attendance system, radio-frequency identification security, and smartcard technologies.

KEY FINANCIAL INDICATORS (Standalone)
Key Parameters Units FY 20-21
(Audited)
FY 19-20
(Audited)
Operating Revenue Rs.Crs. 178.52 168.60
EBITDA Rs.Crs. 27.30 14.93
PAT Rs.Crs. 16.91 13.43
Tangible Net Worth Rs.Crs. 67.06 50.73
Total Debt/Tangible Net Worth Times 0.22 0.49
Current Ratio Times 2.29 1.71

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 16.00
BWR BBB/Stable
(Upgrade)
21Dec2021
BWR BB+ Stable
(Downgrade/ISSUER NOT COOPERATING*)
15Oct2020
BWR BBB- Stable
(Reaffirmation)
NA
NA
FB SubLimit LT (14.50)
BWR BBB/Stable
(Upgrade)
NA
NA
NA
NA
NA
NA
(5.00)
BWR BBB/Stable
(Upgrade)
NA
NA
NA
NA
NA
NA
(5.00)
BWR BBB/Stable
(Upgrade)
NA
NA
NA
NA
NA
NA
Non Fund Based ST 33.50
BWR A3
(Upgrade)
21Dec2021
BWR A4
(Downgrade/ISSUER NOT COOPERATING*)
15Oct2020
BWR A3
(Reaffirmation)
NA
NA
NFB SubLimit ST (14.50)
BWR A3
(Upgrade)
NA
NA
NA
NA
NA
NA
(10.00)
BWR A3
(Upgrade)
NA
NA
NA
NA
NA
NA
Grand Total 49.50 (Rupees Forty Nine Crores and Fifty lakhs Only)
COMPLEXITY LEVELS OF THE INSTRUMENTS - NA

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

Tripti Sharma

Ratings Analyst tripti.s@brickworkratings.com

Dileep Narayan Singh

Director dileep.s@brickworkratings.com
1-860-425-2742 | media@brickworkratings.com
Mantra Softech (I) 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 Cash CreditSanctioned 1.50 _ 1.50
2 ICICI Bank Bank GuaranteeSanctioned _ 18.50 18.50
Sub-Limit (sublimit of BG: LC) Sanctioned (14.50)
3 Punjab National Bank Inland Letter of GuaranteeSanctioned _ 15.00 15.00
Sub-Limit (sublimit ILG: ILC) Sanctioned (10.00)
4 Punjab National Bank Cash CreditSanctioned 14.50 _ 14.50
Sub-Limit (CC (H)) Sanctioned (14.50)
Sub-Limit (FOBC) Sanctioned (5.00)
Sub-Limit (PC) Sanctioned (5.00)
Total 16.00 33.50 49.50
TOTAL (Rupees Forty Nine Crores and Fifty lakhs Only)
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About Brickwork Ratings

Brickwork Ratings (BWR), a Securities and Exchange Board of India [SEBI] registered Credit Rating Agency and accredited by Reserve Bank of India [RBI], offers credit ratings of Bank Loan, Non- convertible / convertible / partially convertible debentures and other capital market instruments and bonds, Commercial Paper, perpetual bonds, asset-backed and mortgage-backed securities, partial guarantees and other structured / credit enhanced debt instruments, Security Receipts, Securitization Products, Municipal Bonds, etc. BWR has rated over 11,400 medium and large corporates and financial institutions’ instruments. BWR has also rated NGOs, Educational Institutions, Hospitals, Real Estate Developers, Urban Local Bodies and Municipal Corporations. BWR has Canara Bank, a leading public sector bank, as one of the promoters and strategic partner. BWR has its corporate office in Bengaluru and a country-wide presence with its offices in Ahmedabad, Chandigarh, Chennai, Hyderabad, Kolkata, Mumbai and New Delhi along with representatives in 150+ locations.

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