BramhaCorp Ltd.

Brickwork Ratings reaffirms the ratings for the Bank Loan Facilities of Rs. 996.06 Crs. of BramhaCorp Ltd.

Particulars

Facilities**	Amount (Rs.Crs.)		Tenure	Rating#
Facilities**	Previous	Present	Tenure	Previous (04 Jan 2021)	Present
Fund Based	995.08	994.06	Long Term	BWR BBB+/Stable Reaffirmation	BWR BBB + /Stable Reaffirmation
Non Fund Based	1.00	2.00	Short Term	BWR A2 Reaffirmation	BWR A2 Reaffirmation
Grand Total	996.08	996.06	(Rupees Nine Hundred Ninety Six Crores and Six lakhs 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

The rating of BramhaCorp Limited has been reaffirmed with a stable outlook on account of stable financial performance and operational performance as per audited FY2021 & gross revenue achieved as per April to November 2021 (Provisional). The rating inter alia also draws strength from the experienced promoters with an established track record in the industry and brand presence in Pune’s real estate market, a diversified business model with two segments of revenue mix i.e. Real Estate Business and Hospitality and track record of timely project execution. Further, its hospitality segment has tie-ups with reputed franchise chains in the hotel business. However, the rating is constrained by the cyclicality in the Indian real estate industry, as well as being exposed to changing regulatory requirements and Covid impact on the hotel industry.

KEY RATING DRIVERS

Credit Strengths:

Experienced Promoters :
The promoters of the company have experience for more than a decade in the same line of business of real estate and hospitality.
Established business in Real Estate and Hospitality sector :
BramhaCorp Limited’s (BCL) has witnessed sales momentum having launched projects backed by necessary infrastructure & land bank. Further, its hospitality sector has tie ups with reputed franchisee chains in hotel business.
Location advantage :
BCL’s projects are mostly located in strategic locations with easy access to Pune International Airway, Kharadi & Hadapsar railway station and also at the city centre.
Operation details :
The company has ongoing projects which enables company to be at a stage wherein couple of their projects are always under the advance stage of construction and couple of them under nascent stage. This combination helps the company to balance its cash flows more efficiently.
Financial Leverage :
The company was established back in 2012 i.e a decade, wherein the company has been making profits and the total shareholder's fund stands at Rs.1148.51 crs as on FY2021. The company has a healthy tangible net worth (net of intangible assets) of Rs.475 crs with debt of Rs.900 crs of debt resulting in gearing of 1.97x. The company generated cash flows from operating activities if Rs.58 crs and Rs.35 crs for FY2020 and FY2021
Project details :
Currently, the company has 4 projects under construction Boulevard, Business Park T9, Collection Project, and Smart Waterbay C. The total cost of the 4 projects is Rs.1622.08 crs, of which the promoter equity amounts to Rs.185.24 crs resulting in the net cost of Rs.1436.84 crs. The company has a total saleable area of 2960634 sq ft and total units of 3472 units.
Industry Outlook :
The real estate business of the company has been concentrated in Pune city of Maharashtra state. The company is into residential as well as commercial space, however, the major penetration is under residential projects. Pune's residential real estate industry has reported 38 percent growth on a year-on-year (YoY) basis in 2021. In the residential segment, Pune witnessed sales of 19,744 housing units in H2 2021. It is expected to grow in the near future which will support the sales of the projects of the company.

Credit Risks:

Cyclicality and high level of regulations :
BCL operates in an industry having high exposure to cyclicality resulting in sales and realisations coming under pressure in an economic downturn. Further, the real estate sector is subject to increased regulatory requirements and are continuously undergoing changes, thus affecting timely execution of projects and leading to increased cost. However, as the major part of the project under progress are located in strategic locations which mitigates such type risk.
Finance Profile :
The revenue declined in FY2021 v/s FY2020 on account of lockdown and covid related restrictions, the timely unavailability of labour and materials leading to lower completion of project in FY2021 in the Real estate segment. Under the Hotel Division, revenue declined from Rs. 92 Cr in FY20 to Rs. 39 Cr in FY21. Due to covid situation, the Hotel division was affected the most, especially H1 FY20-21. Various restrictions were imposed like capacity for dining and stay at 50%, restaurant timings, restriction on weddings and various gatherings, and many more. This has impacted the demand for both hotel stays and restaurants and revenue has declined. However, currently, the company has already recorded revenue of Rs.195 crs and PBT of Rs.15 crs for 8M FY2022.
Geographic Concentration :
BCL’s area of operations is concentrated in the city of Pune, resulting in significant geographical concentration. Any downturn in the area may impact the cash flows adversely.

ANALYTICAL APPROACH - Standalone

For arriving at its ratings, BWR has considered BCL’s audited financials up to FY2021, key financial details for the period April to November 2021 (Provisional), publicly available information and information/clarifications provided by the Company.

RATING SENSITIVITIES

Positive: Revenues and profit shows sustained improvement. Prudent working capital management - Strengthening of liquidity and financial risk profile

Negative: Significant decline in revenue or profitability Deterioration in capital structure or liquidity profile Higher-than-expected increase in debt levels

LIQUIDITY INDICATORS - Adequate

The liquidity position stands adequate. The Company’s liquidity position is marked by cash & cash equivalents of Rs.12.50 crs, Repayment for FY21 is Rs.45.50 crs and the Current ratio stood at 3.81x as on 31Mar2021. Also, the company has unutilised bank lines of Rs.300 crs (Term Loan undisbursed - Rs.237.50 and OD limits - Rs.63.27 crs). For FY2022 and FY2023, the CPTLD stands at Rs.46 crs and Rs.71 crs respectively with expected cash flows of ~Rs.70 crs and Rs.100 crs respectively which will be sufficient to take care of the debt obligation and the DSCR will be in the range of 1.4x to 1.5x.

ABOUT THE ENTITY

Bramha Corp Limited (BCL) is the flagship brand of the Bramha group, which has its business interests in real estate, hotels, clubs, shopping complexes, land development etc. mainly operating in Pune. BCL was incorporated as a limited company in March 2012 by the promoters Mr. Ramkumar Agrawal and Mr. Vinodkumar Agrawal. BCL’s ongoing projects are located in Kalyani Nagar and close to Pune Railway Station. The company has aligned its product portfolio mix and concentrated predominantly in residential real estate development with focus on the middle income group (MIG) and township segment in order to quicker realisation of receivables and completion of projects. BCL’s key projects include F Residences, Waterbay in the residential vertical, Pune One & Vantage in the commercial vertical, Le Meridien, Mahabaleshwar & Grand Sheraton, Pune in hospitality

KEY FINANCIAL INDICATORS (Standalone)

Key Parameters	Units	FY 20-21 (Audited)	FY 19-20 (Audited)
Operating Revenue	Rs.Crs.	236.88	331.05
EBITDA	Rs.Crs.	35.57	77.24
PAT	Rs.Crs.	4.22	20.81
Tangible Net Worth	Rs.Crs.	475.50	471.24
Total Debt/Tangible Net Worth	Times	1.97	1.95
Current Ratio	Times	3.81	4.40

RATING HISTORY FOR THE PREVIOUS THREE YEARS (including withdrawal and suspended)

Facilities	Current Rating (2022)			2021		2020		2019
Type	Tenure	Amount (Rs.Crs.)	Rating	Date	Rating	Date	Rating	Date	Rating
Fund Based	LT	994.06	BWR BBB+/Stable (Reaffirmation)	04Jan2021	BWR BBB+Stable (Reaffirmation)	20Nov2020	BWR BBB+Stable (Reaffirmation)	13Nov2019	BWR BBB+Stable (Reaffirmation)
Non Fund Based	ST	2.00	BWR A2 (Reaffirmation)	04Jan2021	BWR A2 (Reaffirmation)	20Nov2020	BWR A2 (Reaffirmation)	13Nov2019	BWR A2 (Reaffirmation)
Grand Total		996.06	(Rupees Nine Hundred Ninety Six Crores and Six lakhs Only)

Rating Advisory, as on 07Jan2022
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
Heta Mehta Senior Manager - Ratings Board : +91 22 2831 1426, +91 22 2831 1439 heta.m@brickworkratings.com	Bal Krishna Piparaiya Senior Director - Ratings Board : +91 22 2831 1426, +91 22 2831 1439 piparaiya.bk@brickworkratings.com
1-860-425-2742 \| media@brickworkratings.com

BramhaCorp Ltd.

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	Union Bank of India	Term Loan - Sanctioned	_	_	0.00
2	Central Bank of India	Term Loan - Sanctioned	32.01	_	32.01
3	Central Bank of India	Term Loan - Sanctioned	16.83	_	16.83
4	Central Bank of India	Over Draft - Sanctioned	30.00	_	30.00
5	Central Bank of India	Over Draft - Sanctioned	50.00	_	50.00
6	Central Bank of India	Over Draft - Sanctioned	10.00	_	10.00
7	Central Bank of India	CECL - Sanctioned	2.40	_	2.40
8	Central Bank of India	GECL - Sanctioned	24.60	_	24.60
9	Union Bank of India	Bank Guarantee - Sanctioned	_	2.00	2.00
10	Union Bank of India	Term Loan - Sanctioned	_	_	0.00
11	Union Bank of India	Term Loan - Sanctioned	4.61	_	4.61
12	IndusInd Bank	Term Loan - Sanctioned	16.70	_	16.70
13	IndusInd Bank	Term Loan - Sanctioned	275.00	_	275.00
14	JM Financial Credit Solutions Limited	Term Loan - Sanctioned	55.00	_	55.00
15	JM Financial Credit Solutions Limited	Term Loan - Sanctioned	14.97	_	14.97
16	Others	Term Loan - Proposed	39.32	_	39.32
17	PNB Housing Finance Limited	Term Loan - Sanctioned	7.21	_	7.21
18	PNB Housing Finance Limited	Term Loan - Sanctioned	31.95	_	31.95
19	PNB Housing Finance Limited	Term Loan - Sanctioned	197.27	_	197.27
20	Punjab National Bank	Term Loan - Sanctioned	_	_	0.00
21	Punjab National Bank	Term Loan - Sanctioned	64.71	_	64.71
22	Punjab National Bank	Over Draft - Sanctioned	8.23	_	8.23
23	Punjab National Bank	Over Draft - Sanctioned	31.53	_	31.53
24	Punjab National Bank	GECL - Sanctioned	47.00	_	47.00
25	Saraswat Bank	Dropline OD - Sanctioned	5.18	_	5.18
26	Saraswat Bank	Dropline OD - Sanctioned	8.09	_	8.09
27	Union Bank of India	Term Loan - Sanctioned	13.35	_	13.35
28	Union Bank of India	Term Loan - Sanctioned	4.22	_	4.22
29	Union Bank of India	GECL - Sanctioned	3.88	_	3.88
Total			994.06	2.00	996.06
TOTAL (Rupees Nine Hundred Ninety Six Crores and Six lakhs Only)

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