Brickwork Ratings upgrade the long-term & withdrawal of short term ratings for the Bank Loan Facilities of Rs. 25.00 Crs. of Multiwal Duplex Pvt. Ltd.
ParticularsFacilities** | Amount (Rs.Crs.) | Tenure | Rating# | ||
---|---|---|---|---|---|
Previous | Present | Previous (13 Oct 2021) |
Present | ||
Fund Based | 77.90 | 25.00 | Long Term |
BWR D
Reaffirmation/ISSUER NOT COOPERATING* |
BWR BB -
/Stable Upgrade |
Non Fund Based | 2.10 | 0.00 | Short Term |
BWR D
Reaffirmation/ISSUER NOT COOPERATING* |
Withdrawal
|
Grand Total | 80.00 | 25.00 | (Rupees Twenty Five Crores Only) |
BWR has upgraded the long-term ratings of Multiwal Duplex Pvt. Ltd. to BWR BB-/Stable and withdrawal the short-term rating as no limit/liability. The upgradation in the ratings reflects the extensive experience of the promoters, satisfactory net worth, current ratio, and gearing levels. However, the ratings are constrained by high intense competition risk and raw material price fluctuation risk.
The ‘stable’ outlook indicates a low likelihood of the rating change over the medium term. BWR believes that Multiwal Duplex Pvt. Ltd. will continue to benefit from the extensive experience of the promoters.
KEY RATING DRIVERSCredit Strengths:
The director of the company Mr. Mohammad Ather & Mr. Anand Kumar possess a good experience in manufacturing & trading activity which gives benefit to the company to run successfully and attain a good higher growth in the future.
Waste paper pulp has the advantages of low raw material cost, low energy consumption, and low investment, and its production cost is lower than the original pulp, too the company is also indirectly helping to save environment with uses of waste paper pulp instead of wood.
The entry barrier of the industry is low and faces huge competition from the various small and medium manufacturers that leading to limiting the pricing power of a company that affects its profitability of a company.
The intense competition in the industry and the volatility of raw materials prices affect the operating margins of businesses.
The durability of recycled duplex paper and board products will always be a point of contention, as fibre strength reduces with repeated recycling. This can result in product loss and is a market barrier that restricts demand for duplex paper and board.
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 improve its scale of operations, reduction in operating expenses, improve its profitability margins, the debt servicing capability & liquidity would be key rating sensitivities.
Positive: The rating may be revised for an upgrade if the company is able to achieve significant growth in revenue along with a significant improvement in profit margins, and sustained improvement in net worth.
Negative: The rating may be revised negatively if revenue and profit margins substantially deteriorate from current level and if there is an overall deterioration in the financial risk profile of the entity. Any additional borrowing by the company may lead to further deterioration in debt protection metrics and profit margins.
LIQUIDITY INDICATORS - Adequate
Hence the liquidity of the company is adequate.
ABOUT THE ENTITYM/s Marinaindia Traexim Private Limited (MTPL), incorporated in September 2019 as a private limited Company situated behind Welcome Marriage Hall, Barwalan, near Manokamna Mandir, Moradabad Uttar Pradesh, taking over the existing units namely M/s Multiwal Duplex Private Limited (MDPL) through honorable National Company Law Tribunal (NCLT) having an installed capacity of 46800 M.T. per annum based on indigenous as well as imported waste paper. However, the M/s Marinaindia Traexim Private Limited (MTPL) company uses the same name of the acquired company M/s Multiwal Duplex Private Limited to continue run the business. The MDPL is situated at Kundeshwari Road, Kashipur, Udham Singh Nagar, Uttrakhand spread in 4 Acres is having latest well-equipped Machine having installed capacity of 130 Tonne per day of Duplex Board. The company is engaged in manufacturing duplex boards of varied qualities.
KEY FINANCIAL INDICATORS (Standalone)Key Parameters | Units |
FY 21-22 (Audited) |
FY 20-21 (Audited) |
---|---|---|---|
Operating Revenue | Rs.Crs. | 83.95 | 51.87 |
EBITDA | Rs.Crs. | 5.03 | 0.99 |
PAT | Rs.Crs. | 120.97 | 0.26 |
Tangible Net Worth | Rs.Crs. | 40.81 | -92.45 |
Total Debt/TNW | Times | 0.01 | -0.88 |
Current Ratio | Times | 1.64 | 0.41 |
Nil
ANY OTHER INFORMATIONNA
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 | 25.00 |
BWR BB-/Stable
(Upgrade) |
13Oct2021 |
BWR D
(Reaffirmation/ISSUER NOT COOPERATING*) |
29Sep2020 |
BWR D
(Reaffirmation/ISSUER NOT COOPERATING*) |
14May2019 |
BWR D
(Downgrade/ISSUER NOT COOPERATING*) |
Non Fund Based | ST | 0.00 |
Withdrawal
|
13Oct2021 |
BWR D
(Reaffirmation/ISSUER NOT COOPERATING*) |
29Sep2020 |
BWR D
(Reaffirmation/ISSUER NOT COOPERATING*) |
14May2019 |
BWR D
(Downgrade/ISSUER NOT COOPERATING*) |
Grand Total | 25.00 | (Rupees Twenty Five Crores 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 | |
---|---|
Sandeep Jangra Ratings Analyst sandeep.j@brickworkratings.com |
Hari Kishan Yadav Associate Director - Ratings hari.ky@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 | Union Bank of India | Cash CreditSanctioned | _ | _ | 0.00 | |
2 | Others | Term LoanProposed | 25.00 | _ | 25.00 | |
3 | Punjab National Bank | Cash CreditSanctioned | _ | _ | 0.00 | |
4 | Punjab National Bank | Inland Letter of GuaranteeSanctioned | _ | _ | 0.00 | |
5 | Punjab National Bank | ILC/FLCSanctioned | _ | _ | 0.00 | |
6 | Un tied portion | Facilities FB (CC/TL/OD)Proposed | _ | _ | 0.00 | |
Total | 25.00 | 0.00 | 25.00 | |||
TOTAL (Rupees Twenty Five Crores Only) |
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