Ambey Laboratories’ ongoing capex to increase production from 5,000 MT to 6,000 MT and add lines for Atrazine and Metribuzine enhances its business profile. These widely used herbicides have strong demand in major crops, particularly in northern markets, supporting revenue diversification and strengthening the company’s credit profile. The two new product lines are expected to strengthen the company’s product portfolio and support future revenue growth, with commercial benefits likely to accrue from April 2026.
RATING RATIONALE
28Oct2025
Ambey Laboratories Ltd
Brickwork Ratings assigns the ratings for the Bank Loan Facilities of Rs. 80.65 Crs. of Ambey Laboratories Ltd
Particulars| Facilities** | Amount(Rs.Crs.) | Tenure | Rating# | |
|---|---|---|---|---|
| Fund Based | 80.65 | Long Term |
BWR BBB -
/Stable Assignment |
|
| (10.85) | ||||
| (11.32) | ||||
| (11.32) | ||||
| Non Fund Based | (4.00) | Short Term |
BWR A3
Assignment |
|
| (4.00) | ||||
| (4.00) | ||||
| (4.00) | ||||
| (4.00) | ||||
| (4.00) | ||||
| (4.00) | ||||
| (4.00) | ||||
| Grand Total | 80.65 | (Rupees Eighty Crores and Sixty Five lakhs Only) | ||
**Details of Bank Loan facilities,consolidation or instruments are provided in Annexure RATING ACTION / OUTLOOK
Brickwork Ratings has relied on the audited financials of Ambey Laboratories Limited for FY23, FY24, and FY25 and projected financials for FY26 and FY27, information furnished by the client and its bankers, to arrive at the present ratings.
Brickwork Ratings has assigned the ratings to "BWR BBB-/Stable/A3" for the bank loan facilities of Rs. 80.65Crs.The assignment of the rating draws strength from the business experience of the promoters in the agrochemical industry, longstanding relations with the customers, an established track of operations, and an acceptable financial profile. However, the rating is constrained by the scale of operations, intense competition, instability in share price, and volatility associated with the raw material price in this business.
BWR believes that the business risk profile of Ambey Laboratories Limited 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, with improvement in debt protection metrics. The rating outlook may be revised to 'Negative' if the revenues go down, profit margins show lower than expected figures or if there is a delay in debt servicing.
Credit Strengths:
-
Capacity Expansion and Market-Relevant Product Diversification :
-
Extensive Experience of the Promotors :
Driven by forty years of promoter experience, Ambey Laboratories Limited boasts a strong understanding of the agrochemicals sector, translating into solid customer and supplier relationships. Although revenue is highly concentrated, with the 2,4-D product accounting for nearly 90% of sales, the company leverages its diverse product portfolio to maintain a strong clientele. This operational strength is reflected in the expected rise in operating income from Rs 120-130 crore (fiscal 2025) to an anticipated Rs 130-140 crore in fiscal 2026.
-
Healthy Financial Risk Profile :
The company has achieved an 8% revenue growth over the years, with an EBITDA margin of 7.33% and a PAT margin of 3.64%.
Despite ongoing expansion activities, the credit metrics remain comfortable due to a prudent capital structure, notably the debt-to-equity ratio staying below unity. Operational returns are highly efficient, demonstrated by a ROCE of 9.32 times. The ability to service debt obligations is strong, with the ISCR standing at 3.26times and the DSCR at 1.95times, confirming the capability to repay interest and the current portion of long-term debt. The company projects an uplift in future revenue growth once its expansion project is completed and production starts, which is scheduled for FY27.
-
Regulated Nature of Industry :
The agrochemical industry, including the manufacturing of insecticides, pesticides, and herbicides, is highly regulated by the government. Ambey Laboratories’ products are overseen by the Central Insecticides Board and Registration Committee. Any regulatory changes or bans on product usage could adversely impact the company’s revenue, making regulatory risk a key monitorable from a credit perspective.
-
Product Concentration Risk :
Ambey Laboratories Limited’s product portfolio is broadly classified into herbicides and home hygiene products. However, the company derives a major portion of its revenue from agrochemical products, indicating product concentration risk. While it currently manufactures 11 agrochemical and 10 home hygiene products, with 2 new agrochemical products being added, the high dependence on the agrochemical segment exposes the company to sector-specific risks and demand fluctuations.
-
Large working capital requirement :
Ambey Laboratories Limited faces a large working capital requirement, primarily due to a lengthy conversion cycle. As of March 31, 2025, the conversion cycle was approximately 128 days, driven by high inventory levels (78 days) and extended receivables (82 days).
Inventory remains high due to the seasonal nature of the agrochemicals business, which necessitates maintaining significant stock ahead of peak seasons. Separately, receivable days are stretched as a result of industry-wide challenges with suppliers, prompting the company to marginally extend its credit period. Due to these inherent business characteristics, the working capital conversion cycle is expected to remain high, projected at 160-180 days over the medium term.
For arriving at its ratings, BWR has considered the standalone performance of Ambey Laboratories Limited. BWR has applied its rating methodology.
RATING SENSITIVITIES
Going forward, the ability of the company to ensure the timely completion of the ongoing projects without cost overrun, improve the operating margin, and prudently manage its debt and inventory would be the key rating sensitivities.
Positive:
- Steady revenue growth of 10% leading to higher cash accruals
- Timely completion of the planned capex without cost overruns leading to improvement in the PAT Margin above 4.5% .
- Improvement in cash conversion cycle by managing the receivable days.
- A healthy financial credit profile marked by debt to equity < 1, DSCR above 2.5 and ISCR above 3.25 on a sustained basis
Negative:
- Decline in revenue by 10% and a drop in PAT Margin below 3.5%.
- Significant delay in execution of planned capex or cost overruns
- Substantial weakening in debt protection metrics marked by debt to equity above unity
- Any breach in the financial covenants as mentioned in the Sanction Letters of the availed bank loan facilities
Adequate liquidity characterized by a healthy current ratio of 2.19 in FY25 and a moderate cash balance of Rs. 1.76 Crore in FY25. Its bank limits are utilized to the extent of 90% as of 30th Sept 2025.
The firm has net cash accruals of Rs. 8.56 Cr in FY2025 against the CPLTD of Rs. 8.37Crs. The EBITDA of Rs. 9.62Crs. can cover the interest and finance charges of Rs. 2.95Crs. Its capex requirements are modular and expected to be funded using debt of Rs. 10 Crore for which is yet to be tied up, and BWR will monitor the progress of the same. Taking all the above points into consideration, the company's liquidity position is defined as adequate.
| Macro Economic Indicator | Sector | Industry | Basic Industry |
|---|---|---|---|
| Commodities | Chemicals | Chemicals & Petrochemicals | Commodity Chemicals |
Ambey Laboratories Limited, originally incorporated as Ambey Laboratories Private Limited in March 1985 by Mr. Anil Kumar Gupta and Mr. Kewal Sehgal, was converted into a public limited company on 30th December 2014. It operates in the chemical industry with a focus on agrochemicals and crop protection, manufacturing products such as chemicals, compounds, herbal products, insecticides, pesticides, and fungicides, along with a range of home hygiene products. The company has a manufacturing facility in Behror, Alwar, Rajasthan, India, spanning over 20,183.50 square meters. Ambey Laboratories Limited is jointly promoted by Mr. Archit Gupta & Mr. Arpit Gupta, and has been engaged in the agrochemical sector for nearly four decades.
KEY FINANCIAL INDICATORS (Standalone)| Key Parameters | Units |
FY 22 - 23 (Audited - Annual) |
FY 23 - 24 (Audited - Annual) |
FY 24 - 25 (Audited - Annual) |
|---|---|---|---|---|
| Operating Revenue | Rs.Crs. | 104.88 | 120.54 | 131.27 |
| EBITDA | Rs.Crs. | 7.91 | 9.19 | 9.62 |
| PAT | Rs.Crs. | 5.24 | 7.77 | 4.78 |
| Tangible Net Worth | Rs.Crs. | 7.64 | 20.25 | 65.27 |
| Total Debt / Tangible Net Worth | Times | 1.85 | 1.46 | 0.63 |
| Current Ratio | Times | 1.29 | 1.56 | 2.19 |
1. Axis Finance Ltd:
- Existing Unsecured Borrowings: Any existing unsecured borrowings must be subordinated to AFL.
- Borrowing Restriction: The Borrower must not incur additional borrowing or obligations (WC/LAP/TL or guarantees for any group entities) without the prior written consent of AFL.
- Financial Covenants: The borrower must not violate any stipulated financial covenants or allow any deterioration in financial conditions that would impact the fulfillment of obligations.
- Personal Guarantees: The loan is personally guaranteed by Mr. Archit Gupta, Mr. Arpit Gupta, Ms. Rishita Gupta, and Ms. Sarina Gupta.
- Disbursement Condition: Initial funds are earmarked specifically for the closure of NCDs from NP1 Capital Trust and Revx Capital Trust. ( Out of the Rs. 8 Crs Sanctioned amount, Rs. 3 Crs funds were utilized for the closure of Non-Convertible Debentures (NCDs) issued to NP1 Capital Trust and Revx Capital Trust. The No Objection Certificate (NOC) from the Debenture Trustee, Axis Trustee Services Limited, has been annexed in support, and Rs. 5 Crs has been utilized towards capex.)
2. UC Inclusive Credit Pvt Ltd:
- Revenue Target: The Borrower must achieve revenues not less than 80% of the financial projections shared (FY 2025-2026 target: INR 164 Crores).
- Product Diversification (FMCG): Revenue from FMCG products must be at least 5% of total revenues by December 2025 and not less than 8% by March 2026.
- Additional Equity: The Borrower must raise a minimum additional equity of INR 20 Crores within six months from the date of disbursement.
- Shareholding Lock-in: The collective shareholding of the key promoters must not fall below 60.00% without prior UCIC approval.
- Purpose/ End use of facility: For meeting the working capital requirements of the Borrower.
3. Yes Bank:
- Overall Facility Cap: The Total Combined Exposure of all revolving Working Capital Demand Loans (WCDL - INR/FCY) and the Cash Credit (CC) facility must not exceed ?14.15 crore.
- Term Loan Purpose: The Term Loan of ?10.85 crore is specifically for the takeover of an existing Term Loan from Aditya Birla Finance Limited at the outstanding level.
- Cash Margin: 10% Margin required in the form of FDR (Fixed Deposit Receipt) for all LC and BG facilities.
- Related-Party Ban: LCs and BGs are NOT to be issued to or on behalf of any sister concerns, associate concerns, or group companies/associates of the borrower.
- LCs are only to be issued for the procurement of raw material.
- Mandatory Hedging: Any hedge related to the Foreign Currency Term Loan (FCTL) must be done only with Yes Bank.
- FCY Routing: All Foreign Currency (FCY) receivables must be routed exclusively through Yes Bank.
- The terms of sanction include standard covenants normally stipulated for such facilities.
4. Toyota Financial Services India Ltd:
- The terms of sanction include standard covenants normally stipulated for such facilities.
5. Mercedes-Benz Financial Services India Private Limited:
- The terms of sanction include standard covenants normally stipulated for such facilities.
STATUS OF NON-COOPERATION WITH PREVIOUS CRA
Not Applicable
RATING HISTORY FOR LAST THREE YEARS (including withdrawal and suspended)| Facilities | Current Rating (2025) | 2024 | 2023 | 2022 | |||||
|---|---|---|---|---|---|---|---|---|---|
| Type | Tenure | Amount (Rs.Crs.) |
Rating | Date | Rating | Date | Rating | Date | Rating |
| Fund Based | LT | 80.65 |
BWR BBB-/Stable
(Assignment) |
NA |
NA
|
NA |
NA
|
NA |
NA
|
| FB SubLimit | LT | (10.85) |
BWR BBB-/Stable
(Assignment) |
NA |
NA
|
NA |
NA
|
NA |
NA
|
| (11.32) |
BWR BBB-/Stable
(Assignment) |
NA |
NA
|
NA |
NA
|
NA |
NA
|
||
| (11.32) |
BWR BBB-/Stable
(Assignment) |
NA |
NA
|
NA |
NA
|
NA |
NA
|
||
| NFB SubLimit | ST | (4.00) |
BWR A3
(Assignment) |
NA |
NA
|
NA |
NA
|
NA |
NA
|
| (4.00) |
BWR A3
(Assignment) |
NA |
NA
|
NA |
NA
|
NA |
NA
|
||
| (4.00) |
BWR A3
(Assignment) |
NA |
NA
|
NA |
NA
|
NA |
NA
|
||
| (4.00) |
BWR A3
(Assignment) |
NA |
NA
|
NA |
NA
|
NA |
NA
|
||
| (4.00) |
BWR A3
(Assignment) |
NA |
NA
|
NA |
NA
|
NA |
NA
|
||
| (4.00) |
BWR A3
(Assignment) |
NA |
NA
|
NA |
NA
|
NA |
NA
|
||
| (4.00) |
BWR A3
(Assignment) |
NA |
NA
|
NA |
NA
|
NA |
NA
|
||
| (4.00) |
BWR A3
(Assignment) |
NA |
NA
|
NA |
NA
|
NA |
NA
|
||
| Grand Total | 80.65 | (Rupees Eighty Crores and Sixty Five lakhs Only) | |||||||
| Analytical Contacts | |
|---|---|
|
Pradnya Tolanavar Ratings Analyst pradnya.t@brickworkratings.com |
Sabitha M Nayak Associate Director-Ratings sabitha.nayak@brickworkratings.com |
| 1-860-425-2742 | media@brickworkratings.com | Customer Support | CustSupport@brickwrokratings.com |
Ambey Laboratories 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.) | Complexity of the Instrument |
|---|---|---|---|---|---|---|
| 1 | Axis Finance Limited | Term LoanSanctioned | 7.87 | _ | 7.87 | Simple## |
| 2 | Others | Cash CreditProposed | 30.00 | _ | 30.00 | Simple## |
| 3 | Others | Term LoanSanctioned | 4.50 | _ | 4.50 | Simple## |
| 4 | Others | Term LoanSanctioned | 2.70 | _ | 2.70 | Simple## |
| 5 | Others | Term LoanSanctioned | 0.58 | _ | 0.58 | Simple## |
| 6 | Others | Term LoanSanctioned | 0.61 | _ | 0.61 | Simple## |
| 7 | Others | Term LoanProposed | 10.00 | _ | 10.00 | Simple## |
| 8 | Toyota Financial Services India Limited | Term LoanSanctioned | 0.26 | _ | 0.26 | Simple## |
| 9 | Toyota Financial Services India Limited | Term LoanSanctioned | 0.26 | _ | 0.26 | Simple## |
| 10 | Yes Bank | Cash CreditSanctioned | 14.15 | _ | 14.15 | Simple## |
| Sub-Limit (BG - Financial (Sublimit of CC)) Sanctioned | (4.00) | |||||
| Sub-Limit (BG - Performance (Sublimit of CC)) Sanctioned | (4.00) | |||||
| Sub-Limit (Export Packing Credit (Sublimit of CC)) Sanctioned | (4.00) | |||||
| Sub-Limit (LC - Domestic Sight (Sublimit of CC)) Sanctioned | (4.00) | |||||
| Sub-Limit (LC - Domestic Usance (Sublimit of CC)) Sanctioned | (4.00) | |||||
| Sub-Limit (LC - Foreign Sight (Sublimit of CC)) Sanctioned | (4.00) | |||||
| Sub-Limit (LC - Foreign Usance (Sublimit of CC)) Sanctioned | (4.00) | |||||
| Sub-Limit (Post Shipment Credit (Sublimit of CC)) Sanctioned | (4.00) | |||||
| Sub-Limit (WCDL - FCY (Subimit of CC)) Sanctioned | (11.32) | |||||
| Sub-Limit (WCDL - INR (Sublimit of CC)) Sanctioned | (11.32) | |||||
| 11 | Yes Bank | Term LoanSanctioned | 9.72 | _ | 9.72 | Simple## |
| Sub-Limit (Term Loan - FCY (Sublimit of Term Loan)) Sanctioned | (10.85) | |||||
| Total | 80.65 | 0.00 | 80.65 | |||
| TOTAL (Rupees Eighty Crores and Sixty Five lakhs 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.
ANNEXURE-II
INSTRUMENT DETAILS
| Instrument | Issue Date | Amount (Rs.Crs) | Coupon Rate (%) | Maturity Date | ISIN Particulars | Complexity of the Instrument |
|---|---|---|---|---|---|---|
| Nil | Nil | Nil | Nil | Nil | Nil | Nil |
ANNEXURE-III
List of entities consolidated
| Name of Entity | % Ownership | Extent of consolidation | Rationale for consolidation |
|---|---|---|---|
| Nil | Nil | Nil | Nil |
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