Brickwork Ratings reaffirms the ratings for the Bank Loan Facilities of Rs. 82.61 Crs. of Reliance Infrastructure Ltd
ParticularsFacilities** | Amount (Rs.Crs.) | Tenure | Rating# | ||
---|---|---|---|---|---|
Previous | Present | Previous (10 Feb 2023) |
Present | ||
Fund Based | 82.61 | 82.61 | Long Term |
BWR D
ISSUER NOT COOPERATING*/Reaffirmed^ |
BWR D
removal from ISSUER NOT COOPERATING* category/Reaffirmed |
Grand Total | 82.61 | 82.61 | (Rupees Eighty Two Crores and Sixty One lakhs Only) |
The rating reaffirmation, inter alia, factors in the ongoing continuous defaults and delays in making payments to the bank loan facilities, arbitration amount receivable from DAMEPL, deterioration in the credit profile and weakening of financial and debt servicing profile of the company, Further, some of the SPVs/ Subsidiaries companies rated by BWR continues to remain in default and rated at BWR D. The company has overdue and delayed payments to various banks as on FY23. However, the rating continues to factor the experience of promoters in the Engineering and Construction (E&C) segment in power, roads, metro and other infrastructure sectors, completed and present ongoing EPC projects, Power distribution companies in Delhi and road projects. It has also presence in defense sector.
KEY RATING DRIVERSCredit Strengths:
R-Infra is the flagship company of group (Reliance ADAG group) and is promoted by Mr. Anil D. Ambani. It has been in the Engineering and Construction (E&C) segment in power, roads, metro and other infrastructure sectors, completed and present ongoing EPC projects, Power distribution companies in Delhi and road project
It is one of the integrated service providers in the EPC and project management services provider for undertaking turnkey contracts including coal-based thermal projects, gas-based power projects, metro, rail, and road projects. Some of the major projects under EPC segment are Bithnok TPP (1x250 MW) & Barsingsar TPSE (1x250 MW), Rajasthan, worth of Rs.3675 Crs project on turnkey basis, Uppar Thermal Power Project (2x800) in Tamil Nadu, Kudankulam Nuclear Power (KKNP – 3&4) for Design & E&C of common services systems, Mumbai metro line 4, Versova – Bandra Sea link etc. It also has two subsidiary company i.e. BSES Rajdhani for supplying power to South and West Delhi, and BSES Yamuna for supplying power to East and Central Delhi. It also has toll road assets across India, most of which are in completed stage. Some of the major toll road projects are NK Toll, DS Toll, TD Toll, TK Toll, SU Toll, GF Toll, JR Toll, HK Toll, PS Toll and DA Toll Roads. However, some of them continue to be in default due to delays in loan repayment
Entry barriers in the industry are low on account of limited capital and technology requirement and also low differentiation in the end product leading to intense competition and limiting the pricing power resulting in low profitability
The company and some of its subsidiaries continue to delay servicing the debt obligations to the banks.
BWR has taken a consolidated view on the company’s operational and financial performance, promoter’s contribution and all the current business segments while arriving at the rating. For arriving at its ratings, BWR has applied its rating methodology as detailed in the Rating Criteria below (hyperlinks provided at the end of this PPT).
RATING SENSITIVITIES
Positive
BWR could revise the rating if the Company demonstrates substantial growth in Operating revenue and profitability along with closure/regularization of bank loan facilities after the prescribed curing period.
LIQUIDITY INDICATORS - Poor
The company’s cash and cash equivalents were at Rs.855.71 Crs as of FY23. The current ratio stood at 1.16in FY23 which is decreasing when compared to 1.33 in FY22 but still company can meet its current short-term debt obligations 1,16 times over. The total net working capital of the company is Rs.1276.57 Crs in FY23(It is decreased when compared to FY22 and the NWC in FY22 stood at Rs.2651.97 Crs) , this shows that the company has positive net working capital with which the company is capable to pay current short-term debt obligations.Further, the total debt amount stood at Rs.45609.82 Crs (on a Consolidated basis) as of March 2023.
ABOUT THE ENTITY
R-Infra is the flagship company of group (Reliance ADAG group) and is promoted by Mr. Anil D. Ambani. The company has operations in the Engineering and Construction (E&C) segment in power, roads, metro and other infrastructure sectors, completed and present ongoing EPC projects, Power distribution companies in Delhi and road projects. It is one of the integrated service providers in the EPC and project management services for undertaking turnkey contracts including coal-based thermal projects, gas-based power projects, metro, rail, and road projects. Some of the major projects under EPC segment are Bithnok TPP (1x250 MW) & Barsingsar TPSE (1x250 MW), Rajasthan, worth of Rs.3675 Crs project on turnkey basis, Uppar Thermal Power Project (2x800) in Tamil Nadu, Kudankulam Nuclear Power (KKNP – 3&4) for Design & E&C of common services systems, Mumbai metro line 4, Versova – Bandra Sea link etc. It also has two subsidiary company i.e. BSES Rajdhani for supplying power to South and West Delhi, and BSES Yamuna for supplying power to East and Central Delhi. It also has toll road assets across India, most of which are in completed stage. Some of the major toll road projects are NK Toll, DS Toll, TD Toll, TK Toll, SU Toll, GF Toll, JR Toll, HK Toll, PS Toll and DA Toll Roads.
KEY FINANCIAL INDICATORS (Standalone)Key Parameters | Units |
FY 20-21 (Audited) |
FY 21-22 (Audited) |
FY 22-23 (Audited - Midterm_Annual) |
---|---|---|---|---|
Operating Revenue | Rs.Crs. | 1689.15 | 1467.37 | 810.00 |
EBITDA | Rs.Crs. | 6.25 | -145.13 | -280.39 |
PAT | Rs.Crs. | -19.08 | -368.29 | -3197.70 |
Tangible Net Worth | Rs.Crs. | 10375.54 | 10140.52 | 7352.04 |
Total Debt/TNW | Times | 0.37 | 0.38 | 0.46 |
Current Ratio | Times | 1.48 | 1.40 | 1.16 |
Key Parameters | Units |
FY 21-22 (Audited) |
FY 20-21 (Audited) |
FY 22-23 (Audited - Midterm_Annual) |
---|---|---|---|---|
Operating Revenue | Rs.Crs. | 16704.58 | 18411.10 | 20646.43 |
EBITDA | Rs.Crs. | 327.73 | 1878.34 | -2375.33 |
PAT | Rs.Crs. | 3115.65 | -807.72 | -3221.18 |
Tangible Net Worth | Rs.Crs. | 2746.52 | 4943.68 | 3140.88 |
Total Debt/TNW | Times | 5.04 | 2.56 | 3.64 |
Current Ratio | Times | 0.51 | 0.45 | 1.10 |
Facilities | Current Rating (2023) | 2023 (History) | 2022 | 2021 | 2020 | ||||||
---|---|---|---|---|---|---|---|---|---|---|---|
Type | Tenure | Amount (Rs.Crs.) |
Rating | Date | Rating | Date | Rating | Date | Rating | Date | Rating |
Fund Based | LT | 82.61 |
BWR D
(removal from ISSUER NOT COOPERATING* category/Reaffirmed) |
10Feb2023 |
BWR D
(ISSUER NOT COOPERATING*/Reaffirmed^) |
05Jan2022 |
BWR D
(Reaffirmation) |
NA |
NA
|
NA |
NA
|
Grand Total | 82.61 | (Rupees Eighty Two Crores and Sixty One 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 CriteriaAnalytical Contacts | |
---|---|
Chandra shaker Rating Analyst chandra.s@brickworkratings.com |
Nagaraj K Director - Ratings Board : +91 80 4040 9940 nagaraj.ks@brickworkratings.com |
1-860-425-2742 | media@brickworkratings.com |
SL.No. | Name of the Bank/Lender | Type Of Facilities | Long Term(Rs.Crs.) | Short Term(Rs.Crs.) | Total(Rs.Crs.) | |
---|---|---|---|---|---|---|
1 | Canara Bank | Term LoanSanctioned | 82.61 | _ | 82.61 | |
Total | 82.61 | 0.00 | 82.61 | |||
TOTAL (Rupees Eighty Two Crores and Sixty One lakhs Only) |
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