RATING RATIONALE
05Feb2021

Shree Ambica Agro Industries Private Limited

Brickwork Ratings reaffirms/revises the ratings for the Bank Loan Facilities of Rs.10.21 Crs. of Shree Ambica Agro Industries Private Limited

Particulars
Facilities** Amount (Rs.Crs.) Tenure Rating#
Previous Present Previous(13 Aug 2019) Present
Fund Based
Cash Credit Sanctioned 09.00 09.00 Long Term BWR BB - /Stable Reaffirmation BWR BB - /Stable Reaffirmation
Term Loan Out-standing 00.41 00.21
Sub Total 9.41 9.21
Non-Fund Based
Standby line of Credit (SLC) Sanctioned 01.00 01.00 Short Term BWR A4 Reaffirmation BWR A4
Reaffirmation
Sub Total 1.00 1.00
Grand Total 10.41 10.21 (Rupees Ten Crores and Twenty One 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

Brickwork Ratings has relied upon Audited financials of the company for FY 19 and FY 20 along with its projected financials of FY 21 and FY 22, information available in public domain as well as feedback from the company and its bankers for arriving at the present rating. 

The reaffirmation of the ratings factors in the management experience and long standing market presence, improvement in scale of operations, improvement in capacity utilisation, low customer concentration risk and improvement in financial indicator. The rating is however, constrained by long working & inventory cycle, presence in competitive industry and chance of profit vulnerability due to fluctuations in raw material prices & regulatory changes.

The outlook of the company is maintained at stable as the current financial position of the company is not likely to undergo any major change in the near to medium term. The improvement in PAT, Net-worth, Operating and Net profit margin is likely to be sustained.

KEY RATING DRIVERS

Credit Strengths:

Credit Risks:

ANALYTICAL APPROACH - Standalone

BWR has adopted a standalone approach while arriving at its rating and applied its rating methodology as detailed in the rating criteria(hyperlinks provided at the end of this rationale)

RATING SENSITIVITIES

Positive: The rating may be upgraded in case of sustained increase in sales of operations and improvement in margins and debt protection metrics of the company.

Negative: Any delays in servicing of debt obligations, deterioration in liquidity and debt protection metrics, and consistent decline in sales volume and margins, may lead to negative rating action. 

LIQUIDITY INDICATORS - Adequate

The liquidity position of the company is adequate. Average utilisation of cash credit limits is about 60.00% in the last ten months (April 2020 - January 2020). The ISCR and DSCR stood at 2.45 times and 1.72 times respectively in FY 20, and the current ratio stood at 1.46 times in FY 20. The company has a gearing ratio of 1.39 times and total outside liabilities to net-worth of 1.63 times. Company has not availed moratorium facility under COVID from bank. The company has net cash accruals for  Rs. 1.37 Crs in FY 20 and will be in a position to service its debt obligations from its cash accruals, going forward. However, cash & cash equivalent is very low at Rs. 0.09 Crs in FY 20.

ABOUT THE ENTITY

Shree Ambica Agro Industries Pvt Ltd(SAAIPL) was incorporated on 26 December 2005, with its registered office at Bolangir, Odisha. The company was initially established as a proprietorship concern in 1998 under the name of "Shree Ambica Agro Industries". The Company is engaged in cotton ginning and pressing. It procures its raw material i.e. raw cotton (Kapas), from local farmers and through ginning and pressing process, produces cotton bales and cotton seeds. The production facility of the company is situated at Balangir, Odisha, with an installed capacity of 27300 MTPA (Metric ton per annum). The directors of the company are Mr. Arun Kumar Agarwal and Mrs. Nitu Agarwal.

KEY FINANCIAL INDICATORS (Standalone)
Key Parameters Units FY 20-21
(Projected)
FY 19-20
(Audited)
Operating Revenue Rs.Crs. 53.99 54.68
EBITDA Rs.Crs. 3.76 2.68
PAT Rs.Crs. 1.09 0.88
Tangible Net Worth Rs.Crs. 15.75 14.88
Total Debt/Tangible Net Worth Times 1.52 1.39
Current Ratio Times 1.66 1.46
KEY FINANCIAL INDICATORS (C.E)-
Key Parameters Units

Operating Revenue Rs.Crs. Not Available Not Available
EBITDA Rs.Crs. Not Available Not Available
PAT Rs.Crs. Not Available Not Available
Tangible Net Worth Rs.Crs. Not Available Not Available
Total Debt/Tangible Net Worth Times Not Available Not Available
Current Ratio Times Not Available Not Available

RATING HISTORY FOR THE PREVIOUS THREE YEARS (including withdrawal and suspended)
Facilities Current Rating  (2021) Rating History (2020)
Type Tenure Amount Rating NA
Fund Based
Cash Credit - Sanctioned
Term Loan - Out-standing
Long Term 09.00
00.21
BWR BB-/Stable NA
Non-Fund Based
Standby line of Credit (SLC) - Sanctioned Short Term 01.00 BWR A4 NA
Grand Total 10.21 (Rupees Ten Crores and Twenty One lakhs Only)

Facilities Current Rating  (2021) Rating History (2019)
Type Tenure Amount Rating 13Aug2019
Fund Based
Cash Credit - Sanctioned
Term Loan - Out-standing
Long Term 09.00
00.21
BWR BB-/Stable BWR BB -/Stable
Non-Fund Based
Standby line of Credit (SLC) - Sanctioned Short Term 01.00 BWR A4 BWR A4
Grand Total 10.21 (Rupees Ten Crores and Twenty One lakhs Only)

Facilities Current Rating  (2021) Rating History (2018)
Type Tenure Amount Rating 23May2018
Fund Based
Cash Credit - Sanctioned
Term Loan - Out-standing
Long Term 09.00
00.21
BWR BB-/Stable BWR BB/Stable
Non-Fund Based
Standby line of Credit (SLC) - Sanctioned Short Term 01.00 BWR A4 BWR A4
Grand Total 10.21 (Rupees Ten Crores and Twenty One lakhs Only)
Press Release, as on 08Dec2020
COMPLEXITY LEVELS OF THE INSTRUMENTS - NA

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.

Analytical Contacts

Protusha Bera

Rating Analyst Board : +91 80 4040 9940 protusha.b@brickworkratings.com

Anuradha Gupta

Director - Ratings anuradha.g@brickworkratings.com
1-860-425-2742 | media@brickworkratings.com
Shree Ambica Agro Industries Private Limited
ANNEXURE-I
Details of Bank Facilities rated by BWR
SL.No. Type Of Facilities Long Term(Rs.Crs.) Short Term(Rs.Crs.) Total(Rs.Crs.)
1 Cash CreditSanctioned 9.00 _ 9.00
2 Term LoanOut-standing 0.21 _ 0.21
3 Standby line of Credit (SLC)Sanctioned _ 1.00 1.00
Total 9.21 1.00 10.21
TOTAL (Rupees Ten Crores and Twenty One lakhs Only)
ANNEXURE-II
INSTRUMENT DETAILS

InstrumentIssue DateAmount (Rs.Crs)Coupon Rate (%)Maturity DateISIN Particulars
NANANANANANA

ANNEXURE-III
List of entities consolidated

Name of Entity% OwnershipExtent of consolidationRationale for consolidation
NANANANA

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