RATING RATIONALE
10Jun2022

Sambhaav Media Ltd.

Brickwork Ratings reaffirms the ratings for the Bank Loan Facilities of Rs. 29.09 Crs. of Sambhaav Media Ltd.

Particulars
Facilities** Amount (Rs.Crs.) Tenure Rating#
Previous Present Previous
(19 Mar 2021)
Present
Fund Based 19.01 19.01 Long Term BWR BBB- /Stable
Reaffirmation
BWR BBB - /Stable
Reaffirmation
Non Fund Based 10.08 10.08 Short Term BWR A3
Reaffirmation
BWR A3
Reaffirmation
Grand Total 29.09 29.09 (Rupees Twenty Nine Crores and Nine 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

Rating: BWR BBB-/Stable/BWR A3 (Reaffirmation)

The ratings continue to draw strength from its operational track record, strong regional market presence , diversified revenue stream, experienced management having healthy relationships with customers and its comfortable financial risk profile. However, the ratings continue to be constrained by the moderate scale of operations, its significant dependence on advertisement revenue and exposure to competition in the industry. Brickwork Ratings has considered the impact of the Covid-19 pandemic and the measures taken by the Company to mitigate the impact. The pandemic has majorly affected the company’s scale of operations and cash flows. Operating performance was impacted during FY21 owing to Covid19 pandemic and the resultant disruptions in operations. However, the company was able to revive its operations during FY22.

 The ‘Stable’ outlook indicates BWR’s opinion that the Company will continue to benefit from its long track record of operations and the experience of its management and promoters. BWR expects that SML’s business risk profile will be maintained over the medium term.

KEY RATING DRIVERS

Credit Strengths:


Credit Risks:

ANALYTICAL APPROACH - Standalone

While assigning the Ratings, BWR has applied its rating methodology as detailed in the Rating Criteria (hyperlinks provided at the end of this rationale).

RATING SENSITIVITIES

Positive :

Upgrade in rating is unlikely in the near term. BWR may upgrade SML’s rating if the company demonstrates a significant improvement in revenue along with sustained profit margins and improvement in the interest coverage ratios.

Negative :

Negative pressure on the ratings could also arise if the execution is lower than expected, or there is an increase in the working capital cycle. Specific credit metrics that could result in downgrade include interest coverage below 1.70 times on a sustained basis. Pressure on the ratings could also materialise if the financial risk profile weakens due to a slowdown in the execution pace, moderation in profitability and elongation of working capital cycle leads to a significant increase in the working capital requirement and impacts the cash flows. BWR will continue to monitor the pace of revival of revenue from both advertisements and circulation and the effect of cost reduction initiatives on overall operating performance of the Company. Significant and sustained deviations from our base case expectation may adversely impact SML's credit risk profile over the medium term and, thus, will remain a key monitorable

LIQUIDITY INDICATORS - Adequate

Cash accrual is expected to be between Rs 6-10 crs for FY23 and FY24 against debt obligation of around Rs. 1.00 Crs for next two years. SML has sufficient gearing headroom to contract additional debt. Average bank Working Capital limit utilization is moderate at around 65% for last 12 months. Unutilized bank limit is more than adequate to meet incremental working capital needs over the medium term.

ABOUT THE ENTITY

Sambhaav Media Ltd (SML) is a Public Limited Company incorporated in 1990, having its registered office in Ahmedabad, Gujarat. On 06Feb1995, SML got listed in NSE & BSE. Mr. Kiran Vadodaria is the Chairman & Managing Director of the Company. He has more than 3 decades of experience in the industry. The Company is in the business of Publishing of Newspapers, Journals and Periodicals, and Sale of Other Advertising Space or Time. Its business operations include VTV News, Abhiyaan Magazine, Sambhaav Metro, Wise TV, Vehicle Tracking system, Online Portal, Online Application, and FM.

KEY FINANCIAL INDICATORS (Standalone)
Key Parameters Units FY 21-22
(Audited)
FY 20-21
(Audited)
Operating Revenue Rs.Crs. 44.68 41.44
EBITDA Rs.Crs. 6.18 5.52
PAT Rs.Crs. -0.17 -1.86
Tangible Net Worth Rs.Crs. 68.20 67.72
Total Debt/Tangible Net Worth Times 0.14 0.18
Current Ratio Times 2.43 1.96

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 19.01
BWR BBB-/Stable
(Reaffirmation)
19Mar2021
BWR BBB- Stable
(Reaffirmation)
NA
NA
27Dec2019
BWR BBB- Stable
(Reaffirmation)
Non Fund Based ST 10.08
BWR A3
(Reaffirmation)
19Mar2021
BWR A3
(Reaffirmation)
NA
NA
27Dec2019
BWR A3
(Reaffirmation)
Grand Total 29.09 (Rupees Twenty Nine Crores and Nine lakhs Only)
Advisory for delay in periodic review was published on 29 Mar 2022

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

Priya Depala

Senior Rating Analyst priya.d@brickworkratings.com

Dileep Narayan Singh

Director dileep.s@brickworkratings.com
1-860-425-2742 | media@brickworkratings.com
Sambhaav Media 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 Bank of Baroda Term LoanSanctioned 0.83 _ 0.83
2 Bank of Baroda Cash CreditSanctioned 13.25 _ 13.25
3 Bank of Baroda Bank GuaranteeSanctioned _ 8.50 8.50
4 Bank of Baroda Letter of CreditSanctioned _ 1.50 1.50
5 Bank of Baroda Forward ContractSanctioned _ 0.08 0.08
6 Bank of Baroda Funded Interest Term LoanSanctioned 0.88 _ 0.88
7 Bank of Baroda CECLSanctioned 1.30 _ 1.30
8 Bank of Baroda GECLSanctioned 2.75 _ 2.75
Total 19.01 10.08 29.09
TOTAL (Rupees Twenty Nine Crores and Nine lakhs Only)
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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 11,541 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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