Brickwork Ratings has Upgraded the ratings for the Bank Loan Facilities of Rs. 74.55 Crs. of Maan Aluminium Limited 'MAL or the Company'
ParticularsFacilities** | Amount (Rs.Crs.) | Tenure | Rating# | ||
---|---|---|---|---|---|
Previous | Present | Previous (16 Apr 2021) |
Present | ||
Fund Based | 20.00 | 20.00 | Long Term |
BWR BBB/Stable
Reaffirmation |
BWR BBB +
/Stable Upgrade |
40.00 | 40.00 | Short Term |
BWR A3+
Reaffirmation |
BWR A2
Upgrade |
|
(20.00) | (20.00) | ||||
(10.00) | (10.00) | ||||
Non Fund Based | 14.55 | 14.55 | Short Term |
BWR A3+
Reaffirmation |
BWR A2
Upgrade |
(10.00) | (10.00) | ||||
Grand Total | 74.55 | 74.55 | (Rupees Seventy Four Crores and Fifty Five lakhs Only) |
Brickwork Ratings has upgraded the Ratings for the Bank Loan Facilities of Maan Aluminium Ltd. of Rs.74.55 Crs to BWR BBB+/A2 (Stable), on account of the increase in the scale of operations and sustained improvement in the overall financial profile of the Company.
KEY RATING DRIVERSCredit Strengths:
The promoter, Mr. Ravinder Nath Jain has more than three decades of experience in manufacturing and trading of aluminium ingots, billets and other aluminium products. MAL is engaged in trading and manufacturing of aluminium products for more than 18 years and over a period of time, the Company has established strong business relationships with its customers which enables MAL to receive repeat orders.
For the 9MFY22 period, TOI has increased by 85% to Rs.443.29 Crs as against Rs.239.61 Crs in 9MFY21, due to an increase in trading as well as manufacturing activities coupled with an increase in the aluminium prices.
The EBIDTA and PAT for the 9MFY22 period increased to Rs.21.64 Crs and Rs.13.81 Crs respectively as against Rs.15.97 Crs and Rs.9.54 Crs in the 9MFY21 period.
During the 9MFY22 period, the Company has already surpassed its TOI in FY21 and nearly achieved its EBIDTA and PAT of FY21.
As on Sep 30, 2021, TNW of the Company has increased to Rs.73.69 Crs as against Rs.64.06 Crs as on March 31, 2021 due to accretion of profits to the business. Due to this, the Total gearing of the Company has improved to 0.88x as on Sep 30, 2021, as against 1.14x as on March 31, 2021.
ISCR of the Company has remained comfortable for the 9MFY22 period at 5.69x as against 6.31x for FY21.
MAL requires aluminium ingots/billets as a raw material and their prices are highly volatile which exposes the profit margins of the Company. Further, the industry is fragmented and comprises a large number of small and unorganised players which also exerts pressure on the profit margins of MAL.
In FY21, top 2 suppliers contributed to nearly 72% of the MAL’s raw material procurement for the year as against 78% in FY20. However, these suppliers are large reputed companies with an established track record of supplying to MAL which mitigates the risk of supply disruption.
BWR has relied upon audited financials of the Company up to FY21, unaudited financials results for the 9MFY22 period, projections up to FY22, publicly available information and information/clarifications shared by the Company.
RATING SENSITIVITIES
Positive: If the Company manages to further improve its scale of operation with sustained improvement in the profitability and debt coverage indicators would be positive for the ratings.
Negative: A steel decline in revenue levels or significant deterioration in profitability and debt coverage indicators would be negative for the ratings.
LIQUIDITY INDICATORS - Adequate
The liquidity position of the Company is adequate as its current ratio as of Sep 30, 2021 was comfortable at 1.42x and its average CC utilization for the last 6 months period ending Feb'22 was low at 13%. As on March 31, 2022 the Company had a Cash & bank balance of Rs.0.11 Crs. The Company is expected to have interest and finance expenses of Rs.6.70 Crs in FY23 and Rs.7.40 Crs in FY24 and it is expected to generate EBIDTA of Rs.36.30 Crs and Rs.41.80 Crs resulting in an ISCR of 5.42x and 5.65x for FY23 and FY24 respectively.
ABOUT THE ENTITYMAL is a public limited Company incorporated in 2003 and listed in 2007. The Company is engaged in the manufacturing and trading of aluminium ingots, billets, and extruded products. MAL is managed by its promoter viz. Mr. Ravinder Nath Jain has more than three decades of experience in a similar line of business. The Company has 9000 MTPA capacity manufacturing plant at Pithampur, Madhya Pradesh. In FY21, the Company has set-up a new fabrication plant near to its existing plant at Pithampur.
KEY FINANCIAL INDICATORS (Standalone)Key Parameters | Units |
FY 20-21 (Audited) |
FY 19-20 (Audited) |
---|---|---|---|
Operating Revenue | Rs.Crs. | 402.88 | 524.19 |
EBITDA | Rs.Crs. | 24.50 | 12.46 |
PAT | Rs.Crs. | 14.80 | 7.55 |
Tangible Net Worth | Rs.Crs. | 64.06 | 49.96 |
Total Debt/Tangible Net Worth | Times | 1.14 | 0.61 |
Current Ratio | Times | 1.35 | 1.71 |
Facilities | Current Rating (2022) | 2021 | 2020 | 2019 | |||||
---|---|---|---|---|---|---|---|---|---|
Type | Tenure | Amount (Rs.Crs.) |
Rating | Date | Rating | Date | Rating | Date | Rating |
Fund Based | LT | 20.00 |
BWR BBB+/Stable
(Upgrade) |
16Apr2021 |
BWR BBBStable
(Reaffirmation) |
20Mar2020 |
BWR BBBStable
(Reaffirmation) |
28Jun2019 |
BWR BBBStable
(Upgrade) |
Fund Based | ST | 40.00 |
BWR A2
(Upgrade) |
16Apr2021 |
BWR A3+
(Reaffirmation) |
20Mar2020 |
BWR A3+
(Reaffirmation) |
28Jun2019 |
BWR A3+
(Upgrade) |
FB SubLimit | ST | (20.00) |
BWR A2
(Upgrade) |
NA |
NA
|
NA |
NA
|
NA |
NA
|
(10.00) |
BWR A2
(Upgrade) |
NA |
NA
|
NA |
NA
|
NA |
NA
|
||
Non Fund Based | ST | 14.55 |
BWR A2
(Upgrade) |
16Apr2021 |
BWR A3+
(Reaffirmation) |
20Mar2020 |
BWR A3+
(Reaffirmation) |
28Jun2019 |
BWR A3+
(Upgrade) |
NFB SubLimit | ST | (10.00) |
BWR A2
(Upgrade) |
NA |
NA
|
NA |
NA
|
NA |
NA
|
Grand Total | 74.55 | (Rupees Seventy Four Crores and Fifty Five lakhs 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.
Hyperlink/Reference to applicable CriteriaAnalytical Contacts | |
---|---|
Prashant Sahadev Mondkar Ratings Analyst Board : +91 22 2831 1426, +91 22 2831 1439 prashant.sm@brickworkratings.com |
Chintan Dilip Lakhani Director- Ratings chintan.l@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 | HDFC Bank | Cash CreditSanctioned | 20.00 | _ | 20.00 | |
Sub-Limit (PC/PCFC/FBD) Sanctioned | (20.00) | |||||
2 | HDFC Bank | Bill Discounted (BD)Sanctioned | _ | 40.00 | 40.00 | |
Sub-Limit (LC/BG) Sanctioned | (10.00) | |||||
Sub-Limit (PC/PCFC/FBD) Sanctioned | (10.00) | |||||
3 | HDFC Bank | ILC/IBGSanctioned | _ | 14.55 | 14.55 | |
Total | 20.00 | 54.55 | 74.55 | |||
TOTAL (Rupees Seventy Four Crores and Fifty Five lakhs Only) |
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