Brickwork Ratings reaffirms the ratings for the Bank Loan Facilities of Rs. 11.00 Crs. of Vohra Solvex Pvt. Ltd.
Particulars| Facilities** | Amount (Rs.Crs.) | Tenure | Rating# | ||
|---|---|---|---|---|---|
| Previous | Present | Previous (01 Jun 2020) |
Present | ||
| Fund Based | 11.00 | 11.00 | Long Term |
BWR B+ Stable
Assignment |
BWR B +
/Stable Reaffirmation |
| Grand Total | 11.00 | 11.00 | (Rupees Eleven Crores Only) | ||
BWR reaffirmed the long term rating of BWR B+ Stable of Vohra Solvex Private Limited.
The rating draws strength from the rich experience of the promoters in agro commodity business and moderate scale of operations. The rating of the company is constrained by low profitability margins, high gearing level and low current ratio along with susceptability of raw material availability to agro climatic conditions.
BWR believes that the business risk profile of “Vohra Solvex Private 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 there is significant improvement in revenues, improvement in gearing level of the company and profit margins of the company. The rating outlook may be revised to “Negative” if there is any deterioration in the financial risk profile.
KEY RATING DRIVERSCredit Strengths:
The promoters of the company has rich experience of more than 20 years in agro commodity processing business and company has long track record of more than 15 years that helps them to maintain a better relationship with there customers and suppliers as well.
The company revenues has declined from Rs 49.04 crores in FY19 (Audited) to Rs 44.61 crores in FY20 (Audited) However the company has achieved revenues of Rs 57.25 crores in FY21. The company has Moderate Debt Service Indicators with Interest Service Coverage Ratio of 1.29 Times and Debt Service Coverage Ratio of 1.13 Times in FY20 (Audited).
Credit Risks:
The company has high gearing level with TD/TNW of 4.76 Times in FY20 (Audited) along with low Net Profit Margins of 0.31% in FY20 (Audited) and low current ratio of 1.12 Times.
The rice-milling industry is exposed to agro climatic risks which might affect the availability of paddy in adverse weather conditions.
Going forward, the ability of the company to improve its gearing level, profitability margins and financial risk profile would remain the key rating sensitivities.
Positive: Rating may be upgraded in case of substantial improvement in revenues , gearing level and profitability margins.
Negative: Rating may be downgraded in case there is deterioration in financial risk profile of the company.
LIQUIDITY INDICATORS - Stretched
1. The company has no associate concerns or subsidiary concern.
2. The company has cash & bank balances of Rs 0.03 crores in FY20 (Audietd).
3. The company has average utilisation of 96% for last six months of cash credit limit.
4.The company has long term borrowings of Rs 0.40 crores in FY20 (Audited) which comprises of Unsecured Loans from Friends & Relatives of Rs 0.32 crores and Car Loan of Rs 0.08 crores in FY20 (Audited). The company has not submitted cash flow statement for FY20 (Audited).
5. The company has Interest Service Coverage Ratio of 1.29 Times and Debt Service Coverage Ratio of 1.13 Times in FY20 (Audited).
6. .The current ratio has been 1.12 Times as at FY20 (Audited).
7.. The company has elongated conversion cycle of 98 days due to high days Payable.
ABOUT THE ENTITYVohra Solvex Private Limited was established in 2003 the company is engaged in extraction of rice bran oil at its manufacturing facility located at Faridkot. The by product of the process is de oiled rice bran cake which is used as cattle fodder and sold directly to cattle feed units. The company has utilized capacity of 30,000 quintal per month.The company is currently managed by Mr Rohit Vohra and other directors.
KEY FINANCIAL INDICATORS (Standalone)| Key Parameters | Units |
FY 19-20 (Audited) |
FY 18-19 (Audited) |
|---|---|---|---|
| Operating Revenue | Rs.Crs. | 44.61 | 49.04 |
| EBITDA | Rs.Crs. | 1.43 | 1.40 |
| PAT | Rs.Crs. | 0.14 | 0.13 |
| Tangible Net Worth | Rs.Crs. | 2.32 | 2.18 |
| Total Debt/Tangible Net Worth | Times | 4.76 | 5.40 |
| Current Ratio | Times | 1.12 | 1.15 |
| Facilities | Current Rating (2021) | 2020 | 2019 | 2018 | |||||
|---|---|---|---|---|---|---|---|---|---|
| Type | Tenure | Amount (Rs.Crs.) |
Rating | Date | Rating | Date | Rating | Date | Rating |
| Fund Based | LT | 11.00 |
BWR B+/Stable
(Reaffirmation) |
01Jun2020 |
BWR B+ Stable
(Assignment) |
NA |
NA
|
NA |
NA
|
| Grand Total | 11.00 | (Rupees Eleven Crores 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.
Hyperlink/Reference to applicable Criteria| Analytical Contacts | |
|---|---|
|
Aman sharma Rating Analyst Board : +91 172 5032 295 / 6 aman.s@brickworkratings.com |
V.K.Kukreja Associate Director - Ratings Board : +91 11 2341 2232 kukreja.vk@brickworkratings.com |
| 1-860-425-2742 | media@brickworkratings.com | |
| SL.No. | Name of the Bank/Lender | Type Of Facilities | Long Term(Rs.Crs.) | Short Term(Rs.Crs.) | Total(Rs.Crs.) | |
|---|---|---|---|---|---|---|
| 1 | Punjab & Sind Bank | Cash CreditSanctioned | 11.00 | _ | 11.00 | |
| Total | 11.00 | 0.00 | 11.00 | |||
| TOTAL (Rupees Eleven Crores Only) | ||||||
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