Aakriti Super Snacks Pvt. Ltd.

Brickwork Ratings upgrades the the long term ratings at BWR BB+ and removes the rating from the " ISSUER NOT COOPERATING" & reaffirms the short term rating at BWR A4 and removes the rating from the " ISSUER NOT COOPERATING" category for the Bank Loan Facilities of Rs. 22.28 Crs. of Aakriti Super Snacks Pvt. Ltd.

Particulars

Facilities**	Amount (Rs.Crs.)		Tenure	Rating#
Facilities**	Previous	Present	Tenure	Previous (30 Jul 2021)	Present
Fund Based	25.81	21.93	Long Term	BWR BB-/Stable Downgrade/ISSUER NOT COOPERATING*	BWR BB + /Stable removal from ISSUER NOT COOPERATING* category/Upgraded
Non Fund Based	0.35	0.35	Short Term	BWR A4 Downgrade/ISSUER NOT COOPERATING*	*BWR BWR A4 removal from ISSUER NOT COOPERATING category/Reaffirmed**
Grand Total	26.16	22.28	(Rupees Twenty two Crores and twenty eight 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

BWR has upgraded the long term rating of BWR BB+ with a Stable outlook and removed the rating from " ISSUER NOT COOPERATING" category for the bank loan facilities of Aakriti Super Snacks Pvt Ltd. BWR believes that the firms' business risk profile will be maintained over the medium term. The 'Stable' outlook indicates a low likelihood of rating change over the medium term. The rating outlook may be revised to 'Positive' in case the revenues and profit show sustained improvement. The rating outlook may be revised to 'Negative' if the revenues go down and profit margins show lower than expected figures. BWR has essentially relied upon the audited financial statements of Aakriti Super Snacks Pvt Ltd for FY20 and FY21, provisional for FY22 , projections of FY23 and FY24, and publicly available information and information/clarifications provided by the entity’s management. The rating draws strength from the experienced management, scale of operation , moderate profitability & gearing and moderate debt protection ratios. The rating is however constrained by moderate networth.

Going forward the ability of the company to improve its margins, scale of operations, working capital cycle, gearing, along with strengthening its overall financial risk profile would be its key rating sensitivity.

KEY RATING DRIVERS

Credit Strengths:

Management Experience :
The Company was incorporated in 2012. The board of the company consists of Mr. Abhishek Agarwal, & Mr. Aashish Agarwal as the Directors. The company has strong support from management as they bring along a cumulative 20+ years of experience in this business. The company is in existence for 9 years and has seen a complete business cycles. The company has extensive experience of promoters along with healthy relationship with customer and supplier which it has built over the years.
Scale of Operation :
The operating income has increased to Rs 86.73 crs in FY 21 as compared to Rs 66.26 crs in FY 20.The revenue recorded is Rs 71.55 cr in FY22(Prov) , though there seems a decline from previous year , but last year's growth was an unexpected phenomenon where people were hoarding food items due Covid. It is further expected to increase in FY 23 & FY24 as per projections. The company has achieved sales of Rs 35 crs from April 2022 to 12th September 2022, continuing with the trend the company will be able to achieve the projection .
Moderate Profitability & Gearing :
The PAT has declined to Rs 1.83 cr in FY22(Prov) as compared to Rs 2.14 cr in FY21,though there seems a decline from previous year , but last year's growth was an unexpected phenomenon where people were hoarding food items due Covid. Th OPM & NPM have versed well in FY22(Prov) at 7.53% and 2.56% respectively.The TD/TNW has improved to 0.86x in FY 22(Prov) as compared to 0.94x in FY 21 due to decline in Total debt.
Moderate Debt Protection Ratios :
Debt protection metrics are at moderate levels and have improved with DSCR and ISCR standing at 2.13x and 8.08x in FY 22(Prov). Indicating that the company is able to meet its debt obligations on a timely manner.

Credit Risks:

Moderate Net Worth :
The TNW is on an increasing trend and has increased to Rs 13.76 crs in FY 22(prov) as compared to Rs 11.93 crs in FY 21. It is further expected to increase to Rs 16.31 crs in FY 23 as per projections. However is at moderate levels

ANALYTICAL APPROACH - Standalone

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 entity to accelerate its scale of operations, increase its profit margins, compliance of bank's sanction terms, efficiently manage its working capital and cash flows for timely servicing of interest/debt obligations and strengthening of overall financial risk profile shall be the key rating sensitivities over short to medium term.

Positive: The rating outlook may be revised to positive or rating may be upgraded if the company is able to increase its growth and profit margins. Any additional infusion of partner’s capital would help to improve its capital structure of the company.

Negative: The rating outlook may be revised to negative or rating may be downgraded if the company achieves lower revenue and profit margins than projected.

LIQUIDITY INDICATORS - Adequate

The cash & bank balance and net cash accruals of Aakriti Super Snacks Pvt. Ltd. stands at Rs 5.61 cr and 3.66 cr in FY22(Prov) against the debt obligation of Rs 1.36 crs in FY22.The current ratio of the company stands at 1.07x in FY22(Prov) .The average utilization of working capital stood at 47.76% in the last 6 months .

ABOUT THE ENTITY

M/S Aakriti Super Snacks Pvt. Ltd (ASSPL) was incorporated on 4th October 2012 at Raipur, Chhattisgarh. The company has started commercial operations from August 2017.Aashish Agarwal is the Managing Director of the company. Abhishek Agarwal is the other director of the company. It is engaged in bakery products. The Company produces and markets Biscuit, Bread and Rusk. The company sells its products through the brand name of Amal. The company has set up a plant having an annual capacity of 30000 M.T per annum.

The Group was established in year 1990, having presence in central, Eastern and Northern India. From many decades company has legacy of manufacturing fine & delicious biscuits and successful in creating “Close to your heart” our relentless focus on quality and freshness has own us prestigious accolades. Aakriti is a flagship brand of Aakriti Super Snacks Pvt. Ltd. and has fully automated, state-of-the-art food processing unit at Raipur, Chattisgarh, India. Aakriti has wide range of biscuits starting from Butter, Cream, Salty, Sweet and Salt, Marie, Top, Cookies, Cake, Rusk etc. Aakriti Super Snacks honors quality in every aspect of our profession and business. Manufacturing is done in environmental friendly premises and most hygienic conditions.

KEY FINANCIAL INDICATORS (Standalone)

Key Parameters	Units	FY 20-21 (Audited)	FY 19-20 (Audited)
Operating Revenue	Rs.Crs.	86.73	66.26
EBITDA	Rs.Crs.	5.92	5.48
PAT	Rs.Crs.	2.14	1.89
Tangible Net Worth	Rs.Crs.	11.93	9.79
Total Debt/TNW	Times	0.94	1.41
Current Ratio	Times	1.05	1.13

STATUS OF NON-COOPERATION WITH PREVIOUS CRA

India Ratings and Research, vide its press release dated November 29, 2018, had denoted the rating of Aakriti Super Snacks Pvt Ltd as ‘IND B+ (Stable); ISSUER NOT COOPERATING*’

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	21.93	BWR BB+/Stable (removal from ISSUER NOT COOPERATING* category/Upgraded)	30Jul2021	BWR BB-Stable (Downgrade/ISSUER NOT COOPERATING*)	01Oct2020	BWR BBStable (Upgrade)	23Jan2019	BWR BB-Stable (Assignment)
Non Fund Based	ST	0.35	BWR A4 removal from ISSUER NOT COOPERATING* category/Reaffirmed (0)	30Jul2021	BWR A4 (Downgrade/ISSUER NOT COOPERATING*)	01Oct2020	BWR A4+ (Upgrade)	23Jan2019	BWR A4 (Assignment)
Grand Total		22.28	(Rupees Twenty two Crores and twenty eight lakhs 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
Enakshi Makhija Ratings Analyst enakshi.m@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

Aakriti Super Snacks 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	Central Bank of India	Term Loan - Sanctioned	_	_	0.00
2	Central Bank of India	Term Loan - Proposed	_	_	0.00
3	Central Bank of India	Cash Credit - Sanctioned	_	_	0.00
4	State Bank Of India (SBI)	Cash Credit - Sanctioned	1.50	_	1.50
5	State Bank Of India (SBI)	Term Loan - Sanctioned	3.43	_	3.43
6	State Bank Of India (SBI)	Term Loan - Proposed	17.00	_	17.00
Total			21.93	0.00	22.28
TOTAL (Rupees Twenty two Crores and twenty eight lakhs Only)

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