Daxin Pharmaceuticals Pvt. Ltd.

Brickwork Ratings assigns the ratings for the Bank Loan Facilities of Rs. 27.96 Crs. of Daxin Pharmaceuticals Pvt. Ltd.

Particulars

Facilities**	Amount(Rs.Crs.)	Tenure	Rating#
Fund Based	27.96	Long Term	BWR BB + /Stable Assignment
Grand Total	27.96	(Rupees Twenty Seven Crores and Ninety 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

Brickwork Ratings assigns the long-term ratings of BWR BB+/Stable for the bank loan facilities of Rs 27.96 Crs of Daxin Pharmaceuticals Private Limited. The rating is based on an assessment of the FY23, FY24 and FY25 audited financial statements and the latest financial performance of the company as provided by the issuer. The rating considers the promoters’ strong experience and support, along with the company’s moderate financial risk profile. However, it is limited by high competition, volatility in raw material prices, and competitive risk. Going forward, the company’s ability to improve profitability, strengthen liquidity, and overall credit quality will be the key rating sensitivities. The rating outlook is assigned as “Stable,” reflecting BWR’s expectation that Daxin Pharmaceuticals Private Limited’s business risk profile will remain steady over the medium term. A stable outlook indicates a low probability of a rating change during this period. The outlook may be revised to “Positive” if the company achieves sustained improvement in revenue and profitability margins, while it may be revised to “Negative” in the event of a deterioration in its financial risk profile.

KEY RATING DRIVERS

Credit Strengths:

Healthy Promoters Experience & Net-worth :
The company is promoted by Mr. Nikhil Kumar Jha and Mrs. Sheela Jha, who possess over 20 years of experience in the pharmaceutical industry. Daxin Pharmaceuticals has an operating track record of over 11 years, supported by long-standing relationships with customers, which lend stability to business operations and execution capability.
Moderate Financial risk profile :
The financial profile has improved with PAT rising to Rs. 2.43 crore in FY25 from negligible levels in FY23. Key coverage indicators such as ISCR (2.84x in FY25) and DSCR (1.59x in FY25) have strengthened and are projected to remain comfortable over the medium term, supported by improved operating margins and stable accruals
Improving Scale of Operations and Revenue Visibility :
The company’s total operating income increased from Rs. 54.89 crore in FY23 to Rs. 93.78 crore in FY25, registering a strong CAGR of ~30.7%, driven by higher capacity utilisation and increased job-work orders, including from state government entities. The presence of confirmed work orders of Rs. 31.17 crore provides near-term revenue visibility and comfort on achieving FY26 projections.

Credit Risks:

Competitive Industry :
Entry barriers in the pharmaceutical industry are high on account of limited legal and operational requirements, government policies and low differentiation in the end product in terms of generic medicines. This leads to intense competition and limits players' pricing power, resulting in lower profitability.
Moderate Leverage and Debt Protection Metrics :
Although gearing remains moderate at 1.20x in FY25, total debt levels are expected to increase marginally due to additional working capital requirements and term loan repayments commencing from FY27. Sustained improvement in accruals will be critical to maintain comfortable leverage levels.
Exposure to regulatory risks :
The pharmaceutical industry is highly regulated, the Drug Price Control Order impacts product pricing and thereby the profitability of players, though the extent of impact may vary. Although the company is in the business of contract manufacturing, which in turn does not impact its profitability

ANALYTICAL APPROACH - Standalone

To arrive at its ratings, BWR has considered the standalone approach and has applied its rating methodology.

RATING SENSITIVITIES

Positive-

Sustained improvement in scale of operations with total operating income improving beyond Rs. 125 crore, along with operating margins above 7.00% on a sustained basis.
Strengthening of financial risk profile, reflected in Total Debt/TNW, DSCR and ISCR improving on a sustained basis.
Improvement in liquidity position, supported by efficient working capital management, resulting in current ratio consistently above 1.40x and reduced reliance on short-term borrowings.

Negative

Deterioration in liquidity profile, marked by elongation in working capital cycle and current ratio falling below current levels
Weakening of financial risk profile, with Total Debt/TNW exceeding 1.20x or DSCR declining below 1.45x on a sustained basis.
Pressure on operating performance, with operating margins declining below 5.25%, due to pricing pressure, cost escalation, or adverse demand conditions.

LIQUIDITY INDICATORS - Stretched

The Company liquidity profile remains stretched, as reflected by modest cash flow indicators. The Net Cash Accruals stood at Rs. 3.59 crore in FY25 against repayment obligations (CPLTD) of Rs. 2.01 crore. The current ratio remained modest at 1.41x in FY25, indicating a limited short-term liquidity cushion. The firm’s average working capital limit utilisation stood at 86.73% over the past 17 months, providing some liquidity buffer. Additionally, the firm maintained a cash and bank balance of Rs. 0.87 crore as on March 31, 2025.

Considering all these factors, the liquidity position is assessed as "Stretched".

ABOUT THE ENTITY

Macro Economic Indicator	Sector	Industry	Basic Industry
Healthcare	Healthcare	Pharmaceuticals & Biotechnology	Pharmaceuticals

Daxin Pharmaceuticals Pvt. Ltd., a certified company, has worked to produce quality products at the most competitive price since its start in 2014, specialising in the development of medication formulations for almost every therapeutic area. They started their first manufacturing plant in 2017, with a magnificent history of almost 10 years in the pharmaceutical sector, using its infrastructure to manufacture Tablets, capsules, liquid, cefa dry powder injections, and cefa tablet in its manufacturing facility in India. Daxin Pharma has a well-planned infrastructure with dedicated and separate blocks for producing tablets and capsules of the General and Beta-Lactum group of medicines, starting with manufacturing skills. Daxin Pharmaceuticals Private Limited operates as a formulation-focused pharmaceutical manufacturer with integrated manufacturing and distribution capabilities. The company primarily serves the domestic generics market while maintaining compliance-oriented manufacturing standards and a diversified product portfolio.

ESG Profile

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.	54.89	67.02	93.78
EBITDA	Rs.Crs.	2.38	3.61	5.36
PAT	Rs.Crs.	0.05	0.74	2.43
Tangible Net Worth	Rs.Crs.	14.90	17.09	19.51
Total Debt / Tangible Net Worth	Times	0.91	1.16	1.20
Current Ratio	Times	1.27	1.23	1.41

KEY COVENANTS OF THE FACILITY RATED

The terms of the 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 (2026)			2025		2024		2023
Type	Tenure	Amount (Rs.Crs.)	Rating	Date	Rating	Date	Rating	Date	Rating
Fund Based	LT	27.96	BWR BB+/Stable (Assignment)	NA	NA	NA	NA	NA	NA
Grand Total		27.96	(Rupees Twenty Seven Crores and Ninety Six lakhs Only)

Hyperlink/Reference to applicable Criteria

Analytical Contacts
Shikha Kumari Gupta Ratings Analyst shikha.gupta@brickworkratings.com	Ravi Rashmi Dhar Director - Ratings ravi.d@brickworkratings.com
1-860-425-2742 \| media@brickworkratings.com	Customer Support \| CustSupport@brickwrokratings.com

Daxin Pharmaceuticals Pvt. 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	Punjab National Bank	Term Loan - Out-standing	2.05	_	2.05	Simple##
2	Punjab National Bank	Term Loan - Out-standing	0.92	_	0.92	Simple##
3	Punjab National Bank	Term Loan - Out-standing	1.99	_	1.99	Simple##
4	Punjab National Bank	Cash Credit - Sanctioned	23.00	_	23.00	Simple##
Total			27.96	0.00	27.96
TOTAL (Rupees Twenty Seven Crores and Ninety Six 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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