Ganges Internationale Pvt. Ltd.

Brickwork Ratings upgrades the ratings for the Bank Loan Facilities of Rs. 237.93 Crs. of Ganges Internationale Pvt. Ltd.

Particulars

Facilities**	Amount (Rs.Crs.)		Tenure	Rating#
Facilities**	Previous	Present	Tenure	Previous (20 Nov 2020)	Present
Fund Based	100.00	82.93	Long Term	BWR BBB-/Stable Reaffirmation	BWR BBB /Stable Upgrade
Fund Based	32.00	60.00	Short Term	BWR A3 Reaffirmation	BWR A3 + Upgrade
Non Fund Based	95.00	95.00	Short Term	BWR A3 Reaffirmation	BWR A3 + Upgrade
Grand Total	227.00	237.93	(Rupees Two Hundred Thirty Seven Crores and Ninety Three 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

Brickwork Ratings has upgraded the rating to BWR BBB/A3+ Stable for the bank loan facilities of Ganges Internationale Pvt Limited.

The rating has been upgraded to BWR BBB/A3+ for the bank loan facilities of Ganges Internationale Pvt Ltd on account of rise in revenues along with profitability, the roll out of 5G in India, government plans to add more than 8 Lakhs mobile towers in India in next 2 years, prospects in the solar and telecom industry in coming
years is positive.
The rating also factors long established track record, improvement in leverage ratios and consistent operating margin, reputed client base, proximity of Chennai sea port which gives the company an advantage to serve its customer with better lead time especially in case of exports, increase in sales. The rating is, however constrained by customer concentration risk, elongated working capital cycle, and intense competition in the domestic fabrication industry, which restricts its pricing flexibility, government initiatives in Digital India and Green India, extensive experience of the promoters and directors of the company in the executing fabrication framework for telecom, solar and power sectors, the segments the company wishes to expand into in future and satisfactory debt protection profile.

KEY RATING DRIVERS

Credit Strengths:

Experienced Management :
The Chairman and Directors of the Company are well qualified and have good experience of the industry. C&MD has more than 2 decades of vide experience in the business which deals in manufacturer and fabrication of Telecom Towers, Transmission Line Towers & Solar Module Mounting Solutions
Business prospects :
GIPCL is into manufacture of Telecom Towers, Transmission Line Towers & Solar Module Mounting Solutions.Its 50 % of business revenue is from Telecom sector, 35% from Solar sector and balance 15 % from Power sector. It has in-house expertise across various processes of steel fabrication and hence it is in a unique position to meet any design or fabrication requirement with Steel. It's plant is located in Pondicherry which is near Chennai Sea port and it gives the company an added advantage to serve its customer with better lead time especially in case of exports.
Financial profile :
Company’s 50% revenue comes from Telecom sector, 35% from Solar sector and balance 15 % from Power sector. The company has already achieved sales of Rs.282 crs till Dec2021. The company has an order book of Rs.200 crs to be executed in FY2022. Increase in tagible networth with stable debt resulted in improved debt to TNW of 1.40x and coverage ratios of 1.54x ad 1.24x of DSCR and ISCR respectively mitigated by low PAT margins.
Industry outlook :
Telecommunication is the fastest growing industry in India. With 1.189 billion telecom subscribers and 825 million Internet subscribers, India’s telecom industry is the second largest in the world. Over the last few years, the industry has grown exponentially, mostly led by low-cost tariffs, increased availability of the internet, implementation of mobile number portability (MNP), expansion of 3G and 4G coverage, change in subscriber consumption patterns and favourable regulatory environment. The government has underlined the importance of increasing India’s local telecom manufacturing capabilities. Efforts are also underway to build a foundational network in India for the introduction of 5G technology. Given the journey of 5G in India, which is currently picking up pace, a much clearer picture of the future leading up to the 5G debut in India can be constructed. The government is set to give a massive push to telecom infrastructure across the country with plans to add as many as eight lakh new mobile towers over the next two years — more than double the current strength — apart from ensuring that nearly three out of four are connected through optical fibre. This event will support the business of the company and help the company in growing its revenues along with profitability resulting in better working capital management.

Credit Risks:

Elongated Working Capital cycle :
GIPL’s working capital intensity of operations has remained on the higher side due to stretched receivables and high inventory levels. Overall working capital conversion cycle has increased from 77 days in FY 19 to 140 days in FY 20
High competition in industry :
GIPL faces stiff competition from large established players as well as small unorganised players in the telecom tower and solar industries, which limits its pricing flexibility and constrains profitability.

ANALYTICAL APPROACH - Standalone

For arriving at its ratings, BWR has considered the standalone performance of GIPCL i.e audited financials of FY21, information submitted by the management, publicly available information and information/clarifications provided by the Company along with the business linkages with its group concern companies.

RATING SENSITIVITIES

Positive: The rating outlook may be revised to “Positive” in case there is substantial increase in scale of operations with positive improvement in revenues and profit and efficient working capital management .

Negative: The rating outlook may be revised to 'Negative' if the revenues and profitability go down substantially impacting overall debt protection metrics.

LIQUIDITY INDICATORS - Adequate

Liquidity profile of the company is marked as adequate. The company has a cash and bank balance including fixed deposit of Rs.10 crs as on 31st Jan 2022 along with unutilised bank lines of Rs.4.1 crs. Also, the company has cash accruals of Rs.8.01 crs for FYMarch 2021 which will be sufficient to meet the CPLTD of Rs.6.75 crs. The company is expected to record cash accruals of Rs.10.79 crs which is sufficient to meet their CPLTD of Rs.4.95 crs.

ABOUT THE ENTITY

Ganges Internationale Pvt. Ltd. (GIPL) incorporated in 1991, continues to be a family owned company managed by Board of Directors with Mr Nitin Goyal as the Director representing the promoter group and team of qualified and experienced professionals in different fields of operations. Promoters of the company possess over 25 years of experience in the business which deals in Manufacturer of Telecom Towers, Transmission Line Towers & Solar Module Mounting Solutions.Company has modern manufacturing plants at Pondicherry connected to major port, Chennai.

KEY FINANCIAL INDICATORS (Standalone)

Key Parameters	Units	FY 20-21 (Audited)	FY 19-20 (Audited)
Operating Revenue	Rs.Crs.	476.25	397.17
EBITDA	Rs.Crs.	23.52	21.19
PAT	Rs.Crs.	3.23	1.10
Tangible Net Worth	Rs.Crs.	88.27	78.35
Total Debt/Tangible Net Worth	Times	1.40	1.62
Current Ratio	Times	1.27	1.23

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	82.93	BWR BBB/Stable (Upgrade)	NA	NA	06Nov2020	BWR BBB-Stable (Assigned)	NA	NA
		NA	NA	NA	NA	20Nov2020	BWR BBB-Stable (Reaffirmation)	NA	NA
Fund Based	ST	60.00	BWR A3+ (Upgrade)	NA	NA	20Nov2020	BWR A3 (Reaffirmation)	NA	NA
Non Fund Based	ST	95.00	BWR A3+ (Upgrade)	NA	NA	06Nov2020	BWR A3 (Assigned)	NA	NA
		NA	NA	NA	NA	20Nov2020	BWR A3 (Reaffirmation)	NA	NA
Grand Total		237.93	(Rupees Two Hundred Thirty Seven Crores and Ninety Three lakhs Only)

Rating Advisory, as on 22Nov2021
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
Heta Mehta Senior Manager - Ratings Board : +91 22 2831 1426, +91 22 2831 1439 heta.m@brickworkratings.com	Bal Krishna Piparaiya Senior Director - Ratings Board : +91 22 2831 1426, +91 22 2831 1439 piparaiya.bk@brickworkratings.com
1-860-425-2742 \| media@brickworkratings.com

Ganges Internationale 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	Axis Bank Ltd.	Term Loan - Sanctioned	5.43	_	5.43
2	Axis Bank Ltd.	Cash Credit - Sanctioned	30.00	_	30.00
3	Axis Bank Ltd.	Bank Guarantee - Sanctioned	_	10.00	10.00
4	Canbank factor limited	Sales Invoice Financing - Sanctioned	1.00	_	1.00
5	RBL Bank	Bill Discounted (BD) - Sanctioned	_	45.00	45.00
6	SBI Global Factors Limited	Bill Discounted (BD) - Sanctioned	_	15.00	15.00
7	Union Bank of India	Cash Credit - Sanctioned	45.00	_	45.00
8	Union Bank of India	BG/ILC - Sanctioned	_	85.00	85.00
9	Union Bank of India	CECL - Sanctioned	1.50	_	1.50
Total			82.93	155.00	237.93
TOTAL (Rupees Two Hundred Thirty Seven Crores and Ninety Three lakhs Only)

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