RATING RATIONALE
16May2022

Bikaji Foods International Ltd.

Brickwork Ratings reaffirms the ratings for the Bank Loan Facilities of Rs. 122.60 Crs. of Bikaji Foods International Ltd.

Particulars
Facilities** Amount (Rs.Crs.) Tenure Rating#
Previous Present Previous
(12 Feb 2021)
Present
Fund Based 145.00 117.60 Long Term BWR AA- /Stable
Reaffirmation
BWR AA - /Stable
Reaffirmation
Non Fund Based 5.00 5.00 Short Term BWR A1+
Reaffirmation
BWR A1 +
Reaffirmation
Grand Total 150.00 122.60 (Rupees One Hundred Twenty Two Crores and Sixty 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

Brickwork Ratings (BWR) has reaffirmed the long-term rating at BWR AA- (Stable) and short-term rating at A1+ for the bank loan facilities of Bikaji Foods International Limited (BFIL or the company).

The rating derives comfort from its established track record and known 'Bikaji' brand, experienced management, improving scale of operations, and strong financial risk profile via consistent growth in topline, strong debt protection metrics and liquidity of the company, good profit margins, and low gearing providing leverage to raise funds.

The Outlook is Stable considering the steady business performance and sound credit profile which is likely to remain so in the medium term.The company registered total revenue of Rs 771.13 Crs in H1FY22.

IPO (Initial Public Offering)
Bikaji Foods International Ltd. in February 2022 filed draft red herring prospectus (DRHP)  with the Securities and Exchange Board of India (SEBI) to seek the market regulator’s approval for raising funds from the primary market through an IPO.At present, the company has got approval of the same from the regulator. The proposed IPO is an offer-for-sale and will  provide an exit option to current investors. 

KEY RATING DRIVERS

Credit Strengths:


Credit Risks:

ANALYTICAL APPROACH - Standalone

BWR has factored in the standalone business parameters and financial risk profile of the company to arrive at the rating. Although BFIL has reported consolidated financials for FY21, factoring in the financials of newly formed subsidiary Petunt Food Processors Private Limited (PFPPL), there is no major variation between standalone and consolidated financials due to nascent stage of PFPPL operations and its small balance sheet size. Also interim consolidated financials are not available, hence BWR has used the standalone approach for the rating analysis. 

RATING SENSITIVITIES

Upward: The rating may be upgraded if there is continued improvement in the revenue along with product/geographic diversification while sustaining the strong financial risk profile.
Downward: BWR may revise the ratings downwards if the company achieves notably lower revenue than expected, along with a deterioration in debt protection metrics and liquidity.

LIQUIDITY INDICATORS - Strong

BFIL’s had cash accruals (profit after tax +depreciation) of Rs 122.67 Crs in FY21 (Rs 58.91 Crs in H1FY22) against CPLTD of only Rs 13.51 Crs. The company had cash and cash equivalents of Rs 15.36 Crs & bank balances other than cash and cash equivalents of Rs 135.97 Crsin H1FY22. The working capital utilization in SBI is around 66% for the last 6 months till March 2022 and for HDFC bank is NIL. The company had a comfortable current ratio of 1.50x in FY21, besides the company had low gearing of only 0.15x in FY21, which the company can leverage to raise funds incase of need. In addition to that, there was infusion of approximately Rs 150 Crs in the first half of FY22 which further strengthened the liquidity of the company. Projected liquidity index also remains in the Strong category for BFIL.

ABOUT THE ENTITY

Bikaji Foods International Ltd (previously Shivdeep Industries Limited) was founded in 1986 as a partnership concern and was converted to a limited company in October 1995. The erstwhile firm used to sell its product under the name of Haldiram, and from 1993 onwards, the company established the BIKAJI brand for its products. The company is engaged in the manufacturing and processing of bhujia, papad, namkeens, cookies, snacks and sweets, among other products. It also exports to more than 35 countries and contributes approximately 5% of sales. The company has ISO: 9001:2015 and ISO 22000:2005 certified manufacturing facilities in Bichhwal, Bikaner.

KEY FINANCIAL INDICATORS (Standalone)
Key Parameters Units FY 20-21
(Audited)
FY 19-20
(Audited)
Operating Revenue Rs.Crs. 1308.46 1074.55
EBITDA Rs.Crs. 145.25 94.41
PAT Rs.Crs. 89.75 55.48
Tangible Net Worth Rs.Crs. 602.39 526.78
Total Debt/Tangible Net Worth Times 0.15 0.14
Current Ratio Times 1.50 2.19
KEY COVENANTS OF THE FACILITY RATED

NA


STATUS OF NON-COOPERATION WITH PREVIOUS CRA

NA

ANY OTHER INFORMATION

NA

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 117.60
BWR AA-/Stable
(Reaffirmation)
12Feb2021
BWR AA- Stable
(Reaffirmation)
NA
NA
15Nov2019
BWR AA- Stable
(Assignment)
Fund Based ST 0.00
NA
NA
NA
NA
NA
15Nov2019
BWR A1+
(Assignment)
Non Fund Based ST 5.00
BWR A1+
(Reaffirmation)
12Feb2021
BWR A1+
(Reaffirmation)
NA
NA
15Nov2019
BWR A1+
(Assignment)
Grand Total 122.60 (Rupees One Hundred Twenty Two Crores and Sixty lakhs Only)
Rating Advisory, as on 11Feb2022
Press Release, as on 11Feb2022
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

Raman Thakur

Senior Rating Analyst Board : +91 11 2341 2232 raman.t@brickworkratings.com

Tanu Sharma

Director - Ratings tanusharma@brickworkratings.com
1-860-425-2742 | media@brickworkratings.com
Bikaji Foods International 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 HDFC Bank Term LoanSanctioned 25.00 _ 25.00
2 HDFC Bank Cash CreditSanctioned 15.00 _ 15.00
3 State Bank Of India (SBI) Cash CreditSanctioned 50.00 _ 50.00
4 State Bank Of India (SBI) Term LoanOut-standing 27.60 _ 27.60
5 State Bank Of India (SBI) BG/ILCSanctioned _ 5.00 5.00
Total 117.60 5.00 122.60
TOTAL (Rupees One Hundred Twenty Two Crores and Sixty lakhs Only)
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