RATING RATIONALE
16 Sep 2019

Aristo Steel Pvt. Ltd.

Brickwork Ratings assigns the ratings for the Bank Loan Facilities of Rs.9.50 Crs. of Aristo Steel Pvt. Ltd.

Particulars
Facility** Amount (Rs.Crs) Tenure Rating*
Fund Based
Cash Credit Sanctioned 09.50 Long Term BWR BB - (Stable)
Sub Total 09.50
Grand Total 09.50 (Rupees Nine Crores and Fifty lakhs Only)
*Please refer to BWR website www.brickworkratings.com for definition of the ratings
**Details of Bank facilities are provided in Annexure-I
RATING ACTION / OUTLOOK : Stable

BWR has assigned a rating of BWR BB- to Aristo Steel Pvt Ltd on account of extensive experience of the promoters, moderate coverage ratios, moderate profit margins, increase in the scale of operations along with due consideration of stretched gearing due to low level of owned funds and stretched liquidity position.

The ratings have been assigned a stable outlook on account of the potential growth in demand in the Indian stainless steel industry especially the kitchenware industry resulting in an increase in the number of unorganised players in the organised market. BWR believes that Aristo Steel Pvt Ltd business risk profile will be maintained over the medium term.

KEY RATING DRIVERS

Credit Strengths:


Credit Risks:

ANALYTICAL APPROACH AND APPLICABLE RATING CRITERIA

For ariving 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 company’s ability to improve the scale of operations, improve and maintain profitability, the debt servicing capability & liquidity will be the key rating sensitivities.

Positive: The rating will be upgraded if the company is able to achieve significant growth in revenue and profitability backed by a favourable industry scenario and optimum utilisation of capacities, and simultaneous improvement working capital management.

Negative: The rating may be downgraded if there is lower than expected revenues affecting the profitability margins, coverage ratios, liquidity and gearing ratios adversely.

LIQUIDITY POSITION

LIQUIDITY POSITION: Stretched

The cash and cash equivalents of ASPL stand at Rs 0.08 Cr in FY18. The company has no long term debt obligations. The current ratio of the company stands at 1.10x in FY18. The average CC utilization for the last 6 months stands at ~90%.

PROFILE

Aristo Steel Pvt Ltd was founded in the year 1986 by Vasantlal Dungarshi Chheda, Mohan Murji Gada and Ratilal Gaugbhai Dedhia. Headquarter is located in Mumbai, including headquarter there are seven branches of Aristo steel at C.P Tank Mumbai. The two manufacturing plants are situated at Vasai East, Mumbai. Aristo Steel pvt ltd provide variety of range in each segment for instance Dabbas, Thalis, Vatis, Tiffin etc. product range is extended as almost 500 plus variant.

KEY FINANCIAL INDICATORS
Key Parameters Units FY 17-18
FY 16-17
Operating Revenue Rs.Crs. 35.78 18.26
EBITDA Rs.Crs. 2.28 1.58
PAT Rs.Crs. 0.50 0.15
Tangible Net Worth Rs.Crs. 1.81 1.31
Total Debt/Tangible Net Worth Times 7.19 5.28
Current Ratio Times 1.10 1.13

RATING HISTORY (INCLUDING WITHDRAWAL AND SUSPENSION)
S.No Current Rating (2019) Rating History
Facilities Tenure Amount (Rs.Crs) Rating 2018 2017 2016
Fund Based
1
Cash Credit - Sanctioned
Long Term
9.50
BWR BB-
(Pronounced as BWR Double B minus)
(Outlook: Stable)
NA NA NA
Total 09.50 (Rupees Nine Crores and Fifty lakhs Only)
COMPLEXITY LEVELS OF THE INSTRUMENTS

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.

For More Information Contact:
Analytical Contacts Investor Contacts

Saloni R Singh

Ratings Analyst D : +91 22 6745 6647 B : +91 22 2831 1426, +91 22 2831 1439 saloni.s@brickworkratings.com

Liena Thakur

Assistant Vice President - Corporate Communications M : +91 84339 94686 liena.t@brickworkratings.com

Sushil Kumar Chitkara

Associate Director - Ratings B : +91 22 2831 1426, +91 22 2831 1439 sushilkumar.c@brickworkratings.com
1-860-425-2742
Aristo Steel Pvt. Ltd.
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 9.50 _ 9.50
Total 9.50
TOTAL (Rupees Nine Crores and Fifty lakhs Only)
ANNEXURE-II
INSTRUMENT DETAILS

InstrumentIssue DateAmount (Rs.Crs)Coupon RateMaturity DateISIN Particulars
NANANANANANA

ANNEXURE-III
List of entities consolidated

Name of Entity% OwnershipExtent of consolidationRationale for consolidation
NANANANA

Additional information is available at www.brickworkratings.com The ratings above were solicited by,or on behalf of , the issuer, and therefore, Brickwork Ratings has been compensated for the provision of the ratings.
Ratings are not a recommendation or suggestion ,directly or indirectly, to you or any other person, to buy sell, make or hold on any investement,loan or security or to undertake any investement strategy with respect to any investment,loan or security or any issuer.
About Brickwork Ratings

Brickwork Ratings (BWR) is India's home grown credit rating agency built with superior analytical prowess from industry's most experienced credit analysts, bankers and regulators. Established in 2007, Brickwork Ratings aims to provide reliable credit ratings by creating new standards for assessing risk and by offering accurate and transparent ratings. Brickwork Ratings provides investors and lenders timely and in-depth research across the Structured Finance, Public Finance, Financial Institutions, Project Finance and Corporate sectors.

Brickwork Ratings has employed over 350 credit analysts and credit market professionals across 8 offices in India. Our experienced analysts have published over 12,000 ratings across asset classes. Brickwork Ratings is committed to provide the investment community with the products and services needed to make informed investment decisions. Brickwork Ratings is a registered credit rating agency by Securities and Exchange Board of India (SEBI) and a recognized external credit assessment agency (ECAI) by Reserve Bank of India (RBI) to carry out credit ratings in India.

Brickwork Ratings is promoted by Canara Bank, India's leading public sector bank. More on Canara Bank available at www.canarabank.co.in

For more information, visit www.brickworkratings.com

DISCLAIMER

Copyright © 2019 by Brickwork Ratings India Pvt. Ltd., 3rd Floor, Raj Alkaa Park, 29/3 & 32/2, Bannerghatta Main Rd, Kalena Agrahara, Bengaluru, Karnataka 560076.Telephone: +91 80 4040 9940. Fax: +91 80 4040 9941. Reproduction or retransmission in whole or in part is prohibited except by permission. All rights reserved. In issuing and maintaining its ratings, Brickwork Ratings relies on factual information it receives from issuers and underwriters and from other sources Brickwork Ratingsbelieves to be credible. Brickwork Ratings conducts a reasonable investigation of the factual information relied upon by it in accordance with its ratings methodology, and obtains reasonable verification of that information from independent sources, to the extent such sources are available for a given security or in a given jurisdiction. The manner of Brickwork Ratings' factual investigation and the scope of the third-party verification it obtains will vary depending on the nature of the rated security and its issuer, the requirements and practices in the jurisdiction in which the rated security is offered and sold and/or the issuer is located, the availability and nature of relevant public information, access to the management of the issuer and its advisers, the availability of pre-existing third-party verifications such as audit reports, agreed-upon procedures letters, appraisals, actuarial reports, engineering reports, legal opinions and other reports provided by third parties, the availability of independent and competent third-party verification sources with respect to the particular security or in the particular jurisdiction of the issuer, and a variety of other factors. Users of Brickwork Ratings' ratings should understand that neither an enhanced factual investigation nor any third-party verification can ensure that all of the information Brickwork Ratings relies on in connection with a rating will be accurate and complete. Ultimately, the issuer and its advisers are responsible for the accuracy of the information they provide to Brickwork Ratings and to the market in offering documents and other reports. In issuing its ratings Brickwork Ratings must rely on the work of experts, including independent auditors with respect to financial statements and attorneys with respect to legal and tax matters. Further, ratings are inherently forward-looking and embody assumptions and predictions about future events that by their nature cannot be verified as facts.As a result, despite any verification of current facts, ratings can be affected by future events or conditions that were not anticipated at the time a rating was issued or affirmed.

THE INFORMATION IN THIS REPORT IS PROVIDED "AS IS" WITHOUT ANY REPRESENTATION OR WARRANTY OF ANY KIND. A Brickwork Ratings rating is an opinion as to the creditworthiness of a security. This opinion is based on established criteria and methodologies that Brickwork Ratings is continuously evaluating and updating. Therefore, ratings are the collective work product of Brickwork Ratings and no individual, or group of individuals, is solely responsible for a rating. The rating does not address the risk of loss due to risks other than credit risk, unless such risk is specifically mentioned. Brickwork Ratings is not engaged in the offer or sale of any security. All Brickwork Ratings reports have shared authorship. Individuals identified in a Brickwork Ratings report were involved in, but are not solely responsible for, the opinions stated therein. The individuals are named for contact purposes only. A report providing a Brickwork Ratings rating is neither a prospectus nor a substitute for the information assembled, verified and presented to investors by the issuer and its agents in connection with the sale of the securities. Ratings may be changed or withdrawn at anytime for any reason in the sole discretion of Brickwork Ratings. Brickwork Ratings does not provide investment advice of any sort. Ratings are not a recommendation to buy, sell, or hold any security. Ratings do not comment on the adequacy of market price, the suitability of any security for a particular investor, or the tax-exempt nature or taxability of payments made in respect to any security. Neither Brickwork Ratings nor its affiliates, third party providers, as well as their directors, officers, shareholders, employees or agents (collectively, "BWR Reps") guarantee the accuracy, completeness or adequacy of the Report, and no BWR Reps shall have any liability for any errors, omissions, or interruptions therein, regardless of the cause, or for the results obtained from the use of any part of this publication. In no event shall any BWR Reps be liable to any party for any direct, indirect, incidental, exemplary, compensatory, punitive, special or consequential damages, costs, expenses, legal fees, or losses (including, without limitation, lost income or lost profits and opportunity costs) in connection with any use of any part of the Report even if advised of the possibility of such damages. Brickwork Ratings receives fees from issuers, insurers, guarantors, other obligors, and underwriters for rating securities.