RATING RATIONALE
13Aug2021

Maccaferri Environmental Solutions Private Limited

Brickwork Ratings downgrades the Long Term Ratings of Maccaferri environmental solutions Pvt. Ltd. to BWR BBB-/Negative and reaffirms the Short Term ratings at BWR A3 and removes the ratings from Credit Watch.

Particulars
Facilities** Amount (Rs.Crs.) Tenure Rating#
Previous Present Previous
(13 Mar 2020)
Present
Fund Based 52.93 45.00 Long Term BWR BBB Credit Watch with Negative Implications
Reaffirmed
BWR BBB - /Stable to Negative
Downgrade
10.00 10.00 Short Term
BWR A3
Reaffirmation
(20.00) (20.00)
Non Fund Based 20.00 40.00 Short Term BWR A3 Credit Watch With Negative Implications
Reaffirmed
BWR A3
Reaffirmation
(20.00) (20.00)
(0.00) (20.00)
Grand Total 82.93 95.00 (Rupees Ninety Five Crores 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 downgrades the Long Term Ratings of Maccaferri Environmental Solutions Pvt. Ltd. to BWR BBB-/Negative, reaffirms the Short Term ratings at BWR A3 and removes the ratings from Credit Watch.

The ratings are downgraded on account of decline in profit margins in FY21 and the outlook is kept Negative in view of slower debtors realization.

KEY RATING DRIVERS


Credit Strengths:


Credit Risks:

ANALYTICAL APPROACH

BWR has principally relied upon the audited financial results up to FY20, provisional financials for FY21 , projected financials upto FY23, publicly available information and information/clarification provided by the company ' s management.

RATING SENSITIVITIES

Positive: If the Company manages to achieve its envisaged sales projections for FY22 and improve its profit margins and debt coverage indicators it would be positive for the ratings.

Negative: Any further decrease in overall credit risk profile and inability to realise its debtors in near term would be negative for the ratings.

LIQUIDITY INDICATORS - Adequate

The liquidity positive of the Company is adequate as its current ratio as on March 31, 2021 stood at 1.53x. The Company had Cash & bank balance of Rs.55.85 Crs as on June 30, 2021 and its average CC utilisation for 6 months stood at 30% 

ABOUT THE ENTITY

M/s. Maccaferri Environmental Solutions Private Limited (MESPL) was incorporated in 1998 and is involved in the  manufacturing, supply, erection & installation, trading of Gabions, renomattresses wire, geosynthetics and natural fibre products used  for solutions like Retaining Walls & Soil Reinforcement, Rockfall protection, etc. The Company has its factory units at Ranjangaon, Shirur in Maharashtra and at Una in Himachal Pradesh and has taken a new unit on  lease basis at Siliguri, West Bengal for the manufacturing of gabions. Besides these the company has depots and branches across India .

MESPL is promoted by its parent company Officine Maccaferri S.P.A. headquartered in Bologna, Italy. The company is specialized in  products and solutions for the infrastructure, mining, construction industry and various other industry.

On May 15, 2020, NCLT has approved the demerger shceme of manufacturing and EPC divisions of MESPL with effect from April 1, 2019. Accordingly, the manufacturing business is continued in MESPL and the operations of EPC division is transferred to resultant entity.i.e. Maccaferri Infrastructure Pvt. Ltd.

KEY FINANCIAL INDICATORS (Standalone)
Key Parameters Units FY 19-20
(Audited)
FY 18-19
(Audited)
Operating Revenue Rs.Crs. 290.26 322.93
EBITDA Rs.Crs. 2.85 24.81
PAT Rs.Crs. -4.83 7.02
Tangible Net Worth Rs.Crs. 144.39 171.88
Total Debt/Tangible Net Worth Times 0.09 0.29
Current Ratio Times 1.68 1.64

RATING HISTORY FOR THE PREVIOUS THREE YEARS (including withdrawal and suspended)
Facilities Current Rating (2021) 2020 2019 2018
Type Tenure Amount
(Rs.Crs.)
Rating Date Rating Date Rating Date Rating
Fund Based LT 45.00
BWR BBB-/Stable to Negative
(Downgrade)
13Mar2020
BWR BBB Credit Watch with Negative Implications
(Reaffirmed)
NA
NA
13Dec2018
BWR BBB Credit Watch with Developing Implications
(Reaffirmed)
Fund Based ST 10.00
BWR A3
(Reaffirmation)
NA
NA
NA
NA
NA
NA
FB SubLimit ST (20.00)
BWR A3
(Reaffirmation)
NA
NA
NA
NA
NA
NA
Non Fund Based ST 40.00
BWR A3
(Reaffirmation)
13Mar2020
BWR A3 Credit Watch With Negative Implications
(Reaffirmed)
NA
NA
13Dec2018
BWR A3 Credit Watch with Developing Implications
(Reaffirmed)
NFB SubLimit ST (20.00)
BWR A3
(Reaffirmation)
NA
NA
NA
NA
NA
NA
(20.00)
BWR A3
(Reaffirmation)
NA
NA
NA
NA
NA
NA
Grand Total 95.00 (Rupees Ninety Five Crores Only)
Rating Advisory, as on 15Mar2021
Press Release, as on 15Jul2021
COMPLEXITY LEVELS OF THE INSTRUMENTS - Simple

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
Analytical Contacts

Prashant Sahadev Mondkar

Ratings Analyst Board : +91 22 2831 1426, +91 22 2831 1439 prashant.sm@brickworkratings.com

Chintan Dilip Lakhani

Director- Ratings chintan.l@brickworkratings.com
1-860-425-2742 | media@brickworkratings.com
Maccaferri Environmental Solutions Private Limited
ANNEXURE-I
Details of Bank Facilities rated by BWR
SL.No. Name of the Bank/Lender Type Of Facilities Long Term(Rs.Crs.) Short Term(Rs.Crs.) Total(Rs.Crs.)
1 Axis Bank Ltd. Cash CreditSanctioned 20.00 _ 20.00
Sub-Limit (EPC) Sanctioned (20.00)
2 Axis Bank Ltd. Term LoanSanctioned _ _ 0.00
3 Axis Bank Ltd. Bank GuaranteeSanctioned _ 20.00 20.00
Sub-Limit (Letter of Credit) Sanctioned (20.00)
4 Axis Bank Ltd. Bill Discounted (BD)Sanctioned _ 10.00 10.00
5 Axis Bank Ltd. Cash CreditProposed 25.00 _ 25.00
6 Axis Bank Ltd. Letter of CreditProposed _ 20.00 20.00
Sub-Limit (Bank Guarantee) Proposed (20.00)
7 BNP Paribas Cash CreditSanctioned _ _ 0.00
8 Deutsche Bank OverdraftSanctioned _ _ 0.00
Total 45.00 50.00 95.00
TOTAL (Rupees Ninety Five Crores Only)
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