Brickwork Ratings reaffirms the ratings for the Bank Loan Facilities of Rs. 22.00 Crs. of Sri Gayathri Modern Raw & Boiled Rice Mill Private Limited
ParticularsFacilities** | Amount (Rs.Crs.) | Tenure | Rating# | ||
---|---|---|---|---|---|
Previous | Present | Previous (29 Dec 2020) |
Present | ||
Fund Based | 19.00 | 22.00 | Long Term |
BWR BB/Stable
Reaffirmation |
BWR BB
/Stable Reaffirmation |
Grand Total | 19.00 | 22.00 | (Rupees Twenty Two Crores Only) |
BWR believes that Sri Gayathri Modern Raw & Boiled Rice Mill Private Limited 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 DRIVERSCredit Strengths:
The two directors of the company Mr. Durga Prasad Chowdary and Mr. Surya Prabhakar Chowdary Merla has more than two decades of experience in the industry.
The company’s rice milling unit is located in the Yanam, a paddy growing belt of Puducherry , which ensures easy availability of paddy directly from farmers, making operations cost-effective
The revenue of the company has drastically increased by around 93.36%.
Moderate Leverage Ratios reflected with Total Debt/TNW of 1.74 times and TOL/TNW of 1.57 times respectively as on 31st March 2021.
The rice industry is highly fragmented with the presence of many organized and unorganized players.
The availability of paddy is dependent on climatic conditions prevailing during the season. Hence, the company is exposed to the risk of fluctuation in availability and prices of raw-materials.
Company’s ISCR and DSCR are marked average by 1.29 times respectively. Also Net Profit Margin is low marked by 0.03%.
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
The ability of the company to increase revenues, improve its profitability margins, strengthen its credit risk profile and manage its working capital efficiently would remain the key rating sensitivities.
Positive: BWR may revise the ratings upward, in case of improved operating income & profitability margins, reduction in debt levels and strengthening the financial risk profile of the company.
Negative: BWR may revise the rating downward, in case reduction in profitability margins, increase in debt levels thereby impacting the credit profile of the company.
The current ratio was adequate with current ratio 1.63 times and cash and cash equivalent of Rs. 1.23 Crs as on 31st Mar 2021. The company's net cash accruals are Rs. 0.62 crore, as on 31st March ended 2021. For FY21 the company’s OPBIT of Rs. 2.08 Crs was marginally sufficient to cover the interest expenses. Also net cash accruals are projected to be Rs. 0.64 Crs for FY22 against the CPLTD of Rs. 2.19 for FY21. Also Working capital facilities were utilized 71% over the last year. Overall liquidity of the company is adequate.
ABOUT THE ENTITYSri Gayathri Modern Raw & Boiled Rice Mill Private Limited (SGMRBRMPL) was incorporated in the year 1984, located at Yanam, Puducherry. The company is engaged in processing of paddy into boiled rice, raw rice, rice bran, broken rice and husk. The company has an installed capacity of 2880 Quintals per day with an average utilization of around 40 to 50 percent. The company sells different varieties of rice such as BPT, Jaya (Boiled rice), Swarna, surekha and sold under the brand name - ‘Gayathri Rich Rice’. Mr. Merla Durgaprasad Chowdary and Merla Surya Prabhakara Chowdary are currently the directors of the company.
Key Parameters | Units |
FY 20-21 (Audited) |
FY 19-20 (Audited) |
---|---|---|---|
Operating Revenue | Rs.Crs. | 119.73 | 61.92 |
EBITDA | Rs.Crs. | 2.66 | 2.34 |
PAT | Rs.Crs. | 0.03 | -0.07 |
Tangible Net Worth | Rs.Crs. | 12.24 | 12.20 |
Total Debt/Tangible Net Worth | Times | 1.74 | 1.31 |
Current Ratio | Times | 1.63 | 1.65 |
Facilities | Current Rating (2022) | 2021 | 2020 | 2019 | |||||
---|---|---|---|---|---|---|---|---|---|
Type | Tenure | Amount (Rs.Crs.) |
Rating | Date | Rating | Date | Rating | Date | Rating |
Fund Based | LT | 22.00 |
BWR BB/Stable
(Reaffirmation) |
NA |
NA
|
29Dec2020 |
BWR BBStable
(Reaffirmation) |
04Nov2019 |
BWR BBStable
(Reaffirmation) |
Grand Total | 22.00 | (Rupees Twenty Two Crores 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 | |
---|---|
Kovvuru Yeshwanth Kumar Reddy Rating Analyst kykumar.r@brickworkratings.com |
Sankaranarayanan sankaranarayanan@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 | Indian Bank | Cash CreditSanctioned | 22.00 | _ | 22.00 | |
2 | Indian Bank | GECLSanctioned | _ | _ | 0.00 | |
Total | 22.00 | 0.00 | 22.00 | |||
TOTAL (Rupees Twenty Two Crores Only) |
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