RATING RATIONALE
14 Jul 2020
Atlantis Agritech Pvt. Ltd.
Brickwork Ratings assigns the ratings for the Bank Loan Facilities of Rs.15.88 Crs. of Atlantis Agritech Pvt. Ltd.
Particulars| Facility** | Amount (Rs.Crs) | Tenure | Rating* |
|---|---|---|---|
| Fund Based | |||
|
Cash Credit
Sanctioned
Term Loan Sanctioned |
13.50
02.38 |
Long Term | BWR BB (Stable) |
| Sub-Limit (Bank Gaurantee) Sanctioned | (02.40) | Short Term | BWR A4 |
| Sub Total | 15.88 | ||
| Grand Total | 15.88 | (Rupees Fifteen Crores and Eighty Eight lakhs Only) | |
**Details of Bank facilities are provided in Annexure-I RATING ACTION / OUTLOOK : Stable
BWR has essentially relied on Audited financials upto FY19, provisional financial for FY20, projected financial, publicly available information and information & clarifications provided by management.
The rating draws comfort from established track record and experienced promoters with long standing established relationships with clients. However, the rating is constrained by below average financial risk profile and modest scale of operation.
BWR believes that Atlantis Agritech Pvt. Ltd. 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.
KEY RATING DRIVERS
Credit Strengths:
- Experience of the promoter: The promoters of the company are Mr. Rasiklal Madhavji Sureja, Mr. Natvarlal Madhavji Sureja and Mr.Yatin Mansukhlal Sureja who have technical expertise and almost two decades of experience in the Agritech industry.
- Established track record: The company has been in operations for three decades and has seen various business cycles and also established relations with customers which has helped it to bag repeated orders.
Credit Risks:
- Below average financial risk profile: Atlantis Agritech's financial profile is modest marked by moderate net worth of Rs.1.04 Crs. with gearing of 10.10 times in FY19. Modest debt protection metrics with DSCR of 0.97 times and ISCR of 1.45 times in FY19.
- Modest scale of operation: The scale of operation of the company is modest with total operating income (TOI) of Rs. 22.09 crs in FY19. However, as per provisional financials for FY20, TOI doubled in FY20 to Rs. 58.40 crs.
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
Positive:
- Substantial improvement in revenue and profit margins.
- Improvement in financial risk profile of the company.
Negative:
- Decrease in revenue and profitability.
- Deterioration in financial risk profile.
Liquidity Position: Adequate
Liquidity position of the company is adequate as evident from healthy cash accrual for FY20. The cash accruals in FY21 will be sufficient to repay the maturing debt.
PROFILEIncorporated business entitiy in 1989 at Rajkot,Gujarat ,Atlantis Agritech Private Limited is engaged in manufacturing of High- Quality Rotary Tiller and Agriculture Implements in Rajkot, Gujarat under brand name of Rotoking. The manufacturing plant is located at Rajkot, Gujarat with an installed capacity of 30,000 tillers per annum.
KEY FINANCIAL INDICATORS| Key Parameters | Units |
FY 18-19 (Audited) |
FY 17-18 (Audited) |
|---|---|---|---|
| Operating Revenue | Rs.Crs. | 22.09 | 16.93 |
| EBITDA | Rs.Crs. | 1.60 | 0.84 |
| PAT | Rs.Crs. | 0.34 | 0.05 |
| Tangible Net Worth | Rs.Crs. | 1.00 | 0.67 |
| Total Debt/Tangible Net Worth | Times | 10.46 | 13.92 |
| Current Ratio | Times | 1.29 | 1.39 |
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 - SanctionedTerm Loan - Sanctioned | Long Term | 13.5002.38 | BWR BB(Stable) | NA | NA | NA | |||
| 2 | Sub-Limit (Bank Gaurantee) - Sanctioned | Short Term | 02.40 | BWR A4 | NA | NA | NA | |||
| Total | 15.88 | (Rupees Fifteen Crores and Eighty Eight lakhs 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 Criteria : For More Information Contact:| Analytical Contacts | Investor Contacts |
|---|---|
|
Siddharth Shah Lead Analyst siddharth.s@brickworkratings.com |
Liena Thakur Assistant Vice President - Corporate Communications M : +91 84339 94686 liena.t@brickworkratings.com |
|
Dileep Narayan Singh dileep.s@brickworkratings.com |
|
| 1-860-425-2742 | |
| SL.No. | Type Of Facilities | Long Term(Rs.Crs.) | Short Term(Rs.Crs.) | Total(Rs.Crs.) |
|---|---|---|---|---|
| 1 | Cash CreditSanctioned | 13.50 | _ | 13.50 |
| Sub-Limit (Bank Gaurantee) Sanctioned | (2.40) | |||
| 2 | Term LoanSanctioned | 2.38 | _ | 2.38 |
| Total | 15.88 | |||
| TOTAL (Rupees Fifteen Crores and Eighty Eight lakhs Only) | ||||
| Instrument | Issue Date | Amount (Rs.Crs) | Coupon Rate | Maturity Date | ISIN Particulars |
|---|---|---|---|---|---|
| NA | NA | NA | NA | NA | NA |
| Name of Entity | % Ownership | Extent of consolidation | Rationale for consolidation |
|---|---|---|---|
| NA | NA | NA | NA |
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Brickwork Ratings (BWR), a SEBI registered Credit Rating Agency, accredited by RBI and empaneled by NSIC, offers Bank Loan, NCD, Commercial Paper, MSME ratings and grading services. NABARD has empaneled Brickwork for MFI and NGO grading. BWR is accredited by IREDA & the Ministry of New and Renewable Energy (MNRE), Government of India. Brickwork Ratings has Canara Bank, a leading public sector bank, as its promoter and strategic partner. BWR has its corporate office in Bengaluru and a country-wide presence with its offices in Ahmedabad, Chandigarh, Chennai, Hyderabad, Kolkata, Mumbai and New Delhi along with representatives in 150+ locations.
Brickwork Ratings (BWR) has assigned the rating based on the information obtained from the issuer and other reliable sources, which are deemed to be accurate. BWR has taken considerable steps to avoid any data distortion; however, it does not examine the precision or completeness of the information obtained. And hence, the information in this report is presented "as is" without any express or implied warranty of any kind. BWR does not make any representation in respect to the truth or accuracy of any such information. The rating assigned by BWR should be treated as an opinion rather than a recommendation to buy, sell or hold the rated instrument and BWR shall not be liable for any losses incurred by users from any use of this report or its contents. BWR has the right to change, suspend or withdraw the ratings at any time for any reasons.