RATING RATIONALE
25May2022

Snowtemp Commercial Pvt. Ltd.

Brickwork Ratings reaffirms the long term ratings for the Bank Loan Facilities of Rs. 10.00 Crs. of Snowtemp Commercial Pvt. Ltd.

Particulars
Facilities** Amount (Rs.Crs.) Tenure Rating#
Previous Present Previous
(15 Apr 2021)
Present
Fund Based 10.00 10.00 Long Term BWR BB- /Stable
Upgrade
BWR BB - /Stable
Reaffirmation
Grand Total 10.00 10.00 (Rupees Ten 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

BWR has reaffirmed the long term rating of ‘Snowtemp Commercial Pvt Ltd’ to BWR BB- with a "Stable" outlook. BWR believes that the firm's business risk profile will be maintained over the medium term. The rating outlook may be revised to 'Positive' in case the revenues and profit show sustained improvement backed by a favorable industry scenario. The rating outlook may be revised to 'Negative' if the profit and revenue margins show lower than expected figures.

BWR has essentially relied upon the audited financial statements of ‘Snowtemp Commercial Pvt Ltd’ for FY20, FY21 ,Sales figures for FY22 and projections of FY22 , FY23, and publicly available information and information/clarification provided by the entity's management.

The reaffirmation of ratings favorably factors in below points:

1) Extensive Experience of Promoter.

2) Diversified clientele and caters to varied industries and Established relationship with reputed supplier.

3) Low Gearing and Moderate Debt protection metrics.

 

The ratings are however constrained by:

1) Susceptible to cyclical demand in the coke industry and volatility in raw material prices.

2) Declining Profitability.

3) Highly Stretched Working Capital.

 

KEY RATING DRIVERS

Credit Strengths:


Credit Risks:

ANALYTICAL APPROACH - Standalone

BWR has essentially relied upon the audited financial statements of ‘Snowtemp Commercial Pvt Ltd’ for FY20, FY21 ,Sales figures for FY22 and projections of FY22 , FY23, and publicly available information and information/clarification provided by the entity's management.

RATING SENSITIVITIES

Going forward, the ability of the company to increase its scale of operations while sustaining or improving its profitability will be the key rating sensitivities.

Positive: The outlook may be revised to Positive if the company records significantly better-than-expected growth in revenues along with improvement in profitability levels and efficient working capital management, resulting in better debt coverage metrics.

Negative: The outlook may be revised to Negative if the company reports significantly lower than expected performance, resulting in lower than estimated coverage indicators and a weaker liquidity position.

LIQUIDITY INDICATORS - Adequate

1) The liquidity position of the company is adequate.

2) The current ratio stands at 1.81 times as of 31st March 2021 and 1.88 times as of 31st March 2022.

3) Net cash accruals of 0.60 Crs in FY21 and projected cash accruals of 0.81 Crs in FY22 are sufficient enough to repay back the debt obligation.

4) The average CC utilization of the client stands at 50%

ABOUT THE ENTITY

Snowtemp Commercial Pvt Ltd was incorporated in 1995 with its registered office in Kolkata, West Bengal. Mr. Sundeep Kedia, Mr. Sujay Bhowal, Mr. Pradeep Kumar Agarwal and Mrs. Sangeeta Agarwal are the promoter director of the company. The company is engaged in manufacturing of Soft Coke and Special Smokeless fuel by the process of devolatilization of low grade coking coal in Bhojpur, Bihar. The company uses CFRI (Central Fuel Research Institute) Technology and SSF (Special Smokeless Fuel). The products manufactured by the company includes Soft Coke/SSF (bigger sized), Medium Soft Coke (smaller sized) and Slack Soft Coke which are used as pollution free fuel in hotels, dhaba, restaurants and also as domestic fuel in rural households.

KEY FINANCIAL INDICATORS (Standalone)
Key Parameters Units FY 20-21
(Audited)
FY 19-20
(Audited)
Operating Revenue Rs.Crs. 26.07 11.65
EBITDA Rs.Crs. 1.52 0.77
PAT Rs.Crs. 0.56 0.30
Tangible Net Worth Rs.Crs. 12.83 12.27
Total Debt/Tangible Net Worth Times 0.49 0.34
Current Ratio Times 1.81 4.15
KEY COVENANTS OF THE FACILITY RATED

NA


STATUS OF NON-COOPERATION WITH PREVIOUS CRA

NA

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 10.00
BWR BB-/Stable
(Reaffirmation)
15Apr2021
BWR BB- Stable
(Upgrade)
02Mar2020
BWR B+ Stable
(Downgrade)
27Mar2019
BWR BB- Stable
(Downgrade)
Grand Total 10.00 (Rupees Ten 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

Jigar Manik Gogri

Ratings Analyst jigarmanik.g@brickworkratings.com

Sushil Kumar Chitkara

Director - Ratings Board : +91 22 2831 1426, +91 22 2831 1439 sushilkumar.c@brickworkratings.com
1-860-425-2742 | media@brickworkratings.com
Snowtemp Commercial 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 Punjab National Bank Cash CreditSanctioned 5.95 _ 5.95
2 Punjab National Bank Cash CreditProposed 4.05 _ 4.05
Total 10.00 0.00 10.00
TOTAL (Rupees Ten Crores Only)
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