RATING RATIONALE
12May2022

Balajee Structural (India) Pvt. Ltd. (erstwhile Balajee Structural (India) Limited)

Brickwork Ratings revises the ratings for the Bank Loan Facilities of Rs. 30.00 Crs. of Balajee Structural (India) Pvt. Ltd. (erstwhile Balajee Structural (India) Limited)

Particulars
Facilities** Amount (Rs.Crs.) Tenure Rating#
Previous Present Previous
(04 May 2021)
Present
Fund Based 23.00 30.00 Long Term BWR BB+/Stable
Downgrade/ISSUER NOT COOPERATING*
BWR BBB /Stable
Upgrade
Grand Total 23.00 30.00 (Rupees Thirty 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 upgrade the long-term to BWR BBB Stable/ Upgrade for the Bank Loan Facilities of Balajee
Structural (India) Ltd. amounting to ₹ 30.00 Crores, 
Brickwork Ratings has Upgrade the long term rating of Balajee Structural (India) Ltd. at BWR BBB (Stable)Upgrade.
Brickwork Ratings(BWR) has essentially relied on the audited financial statements of Balajee Structural (India) Ltd. upto
FY21, YTD of FY22, projections upto FY23, publicly available information and information/clarifications provided by
the company’s management and its bankers to arrive at the present ratings. The rating further draws strength from
management experience financial risk profile and locational advantage. The rating is partially offset by Vulnerability to
cyclical nature of industry, raw material price fluctuations and Intense Competition.

BWR believes that Balajee Structural (India) Ltd. 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 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. Reference may be made to the Rating Criteria hyperlinked detailed below (hyperlinks provided at the end of this rationale).

RATING SENSITIVITIES

Going forward, the ability of the entity to accelerate its scale of operations, increase its profit margins, compliance of bank's sanction terms, efficiently manage its working capital and cash flows for timely servicing of interest/debt obligations and strengthening of overall financial risk profile shall be the key rating sensitivities over short to medium term.

Positive: The rating outlook may be revised to positive or the rating may be upgraded if the company is able to sustain its growth and profit margins. Any additional infusion of share’s capital would help to improve the capital structure of the entity.

Negative: The rating outlook may be revised to negative or the rating may be downgraded if the entity achieves lower revenue and profit margins than projected

LIQUIDITY INDICATORS - Adequate

The liquidity profile of the company is adequately driven by a current ratio of 2.16X in FY21 and  3.13X in FY20 . The average utilization for three CC limits stands at 13.48% for the last 7 months (Nov 2021- May 2022)

  • Cash and bank balances for FY22 is Rs. 36.77Crs and for FY21 was 7.23 Crs.

  • Net Cash Accruals is Rs 9.63 Crs in FY22 v/s Rs 7.23 Crs in FY21.

  • The current ratio for FY22 is 4.60 times as compared to 2.16 times in FY21.

  • CC Limit Utilisation is 32.76% for the latest seven months for the period August 2021 to February 2022.

ABOUT THE ENTITY

Balajee Structural (India) Limited was incorporated on 25 February 2000 in Raipur, Chhattisgarh. Major promoters of the company are Mr. Amit Jindal, Mr. Suresh Kumar Agrawal, Mr. Vishnu Kumar Agrawal, Mr. Raj Roop Singh, and Mr. Manish Agrawal. Its manufacturing facility is located at Raipur, Chhattisgarh with an installed capacity of 59,200 MTPA. BSIL manufactures various steel products such as billets, ingots, angles, flats, and joists. BSIL’s steel plant is fully integrated. The company manufactures billets and ingots and uses these in the manufacture of structural steel products such as angles, channels, flats, and joists. 

 

KEY FINANCIAL INDICATORS (Standalone)
Key Parameters Units FY 20-21
(Audited)
FY 19-20
(Audited)
Operating Revenue Rs.Crs. 178.99 233.39
EBITDA Rs.Crs. 8.80 12.84
PAT Rs.Crs. 3.61 7.04
Tangible Net Worth Rs.Crs. 55.69 52.08
Total Debt/Tangible Net Worth Times 0.57 0.31
Current Ratio Times 2.16 3.13
KEY COVENANTS OF THE FACILITY RATED

N.A


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 30.00
BWR BBB/Stable
(Upgrade)
04May2021
BWR BB+Stable
(Downgrade/ISSUER NOT COOPERATING*)
NA
NA
15Nov2019
BWR BBB+Stable
(Upgrade)
NFB SubLimit ST NA
NA
04May2021
BWR A4+
(Downgrade/ISSUER NOT COOPERATING*)
NA
NA
15Nov2019
BWR A3+
(Assignment)
Grand Total 30.00 (Rupees Thirty Crores Only)
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

Bhavna Vashdev Gurdasani

Ratings Analyst bhavna.g@brickworkratings.com

Sushil Kumar Chitkara

Director - Ratings Board : +91 22 2831 1426, +91 22 2831 1439 sushilkumar.c@brickworkratings.com
1-860-425-2742 | media@brickworkratings.com
Balajee Structural (India) Pvt. Ltd. (erstwhile Balajee Structural (India) 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 Punjab National Bank Cash CreditSanctioned 30.00 _ 30.00
Total 30.00 0.00 30.00
TOTAL (Rupees Thirty Crores Only)
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