Ananya Engineering Pvt. Ltd.

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

Particulars

Facility**	Amount (Rs.Crs)	Tenure	Rating*
Fund Based
Cash Credit - Sanctioned	09.50	Long Term	BWR B (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 B on account of extensive experience of the promoters, revenue visibility provided by the order book, moderate debt protection metrics, modest profitability. The ratings also factored the geographical concentration of business, tender based nature of the business, small scale of operations, low level of owned funds, stretched gearing and below-average liquidity profile.

The ratings have been assigned a stable outlook on account of the projected healthy growth in the Indian EPC industry. BWR believes that Ananya Engineering Pvt Limited business risk profile will be maintained over the medium term.

KEY RATING DRIVERS

Credit Strengths:

• Extensive experience of the promoters :

  The promoters have an experience of over a decade in the same industry.

• Revenue visibility :

  Orders in hand amounting to Rs 29 Cr , providing revenue visibility.

• Moderate debt protection metrics :

  Moderate debt protection metrics with the ISCR and DSCR standing at 2.67x and 1.52x respectively in FY19 as compared to 1.68x and 1.22x in FY18.

• Modest profitability :

  Modest profitability with the NPM and OPM standing at 2.97% and 9.10% respectively and 3.19% and 6.84% respectively in FY18.

Credit Risks:

• Geographical concentration of business :

  Geographical concentration of business with the majority of the business revenue coming from Bhopal.

• Tender based nature of business :

  Since the entire income is tender based, business will depend on the ability to bid successfully for them. Also, majority of orders are from government entities, resulting in high dependence on timely clearances for tenders and payment. Revenue and profitability are expected to remain susceptible to risks inherent in tender-based operations.

• Small scale of operations :

  Small scale of operations with the TOI standing at Rs 25.22 Cr in FY19 as compared to Rs 26.67 Cr in FY18.

• Low level of owned funds with stretched gearing :

  Low level of owned funds with the TNW standing at Rs 1.96 Cr in FY19 as compared to Rs 1.21 Cr in FY18.The gearing is stretched with the total debt/ TNW and TOL/TNW standing at 5.52x and 8.11x respectively in FY19 as compared to 4.25x and 6.23x in FY18. Whereas, the analysed gearing stands at 2.60x in FY19.

• Below Average liquidity profile :

  Below average liquidity profile with the current ratio standing at 1.19x in FY19 as compared to 1.31x in FY18.

ANALYTICAL APPROACH AND APPLICABLE RATING CRITERIA

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 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 sustained 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: Adequate

The current ratio of the company stands at 1.19x in FY19.  The cash accruals stand at Rs 1.22 Cr in Fy19 as compared to a minimal long term debt repayment obligation in FY19. The average CC utilization stands at 80-90% as per banker feedback. The company has an unencumbered modest cash balance amounting to Rs 1.21 Cr in FY19.

PROFILE

Ananya Engineering Pvt Ltd is incorporated in 2009 and is promoted by Raj Gupta, Gagan Gupta, Aabhas Gupta. AEPL undertakes construction and maintenance of railway tracks, bridges and platforms and buildings, roads, tunnels, ports, harbours, runways etc. AEPL’s work includes building of complete constructions or parts thereof; civil engineering.

KEY FINANCIAL INDICATORS

Key Parameters	Units	FY 18-19 (Audited)	FY 17-18 (Audited)
Operating Revenue	Rs.Crs.	25.22	26.67
EBITDA	Rs.Crs.	2.29	1.82
PAT	Rs.Crs.	0.75	0.85
Tangible Net Worth	Rs.Crs.	1.96	1.21
Total Debt/Tangible Net Worth	Times	5.52	4.25
Current Ratio	Times	1.19	1.31

RATING HISTORY (INCLUDING WITHDRAWAL AND SUSPENSION)

S.No	Current Rating (2020)				Rating History
	Facilities	Tenure	Amount (Rs.Crs)	Rating	2019	2018	2017
Fund Based
1	Cash Credit - Sanctioned	Long Term	09.50	BWR B (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

SL.No.	Type Of Facilities	Long Term(Rs.Crs.)	Short Term(Rs.Crs.)	Total(Rs.Crs.)
1	Cash Credit - Sanctioned	9.50	_	9.50
Total				9.50
TOTAL (Rupees Nine Crores and Fifty lakhs Only)