RATING RATIONALE
24Aug2021

Kay Kay Scaffolding Pvt Ltd

Brickwork Ratings reaffirms/revises the ratings for the Bank Loan Facilities of Rs. 10.28 Crs. of Kay Kay Scaffolding Pvt Ltd

Particulars
Facilities** Amount (Rs.Crs.) Tenure Rating#
Previous Present Previous
(30 Jun 2020)
Present
Fund Based 3.51 4.28 Long Term BWR B+/Stable
BWR B + /Stable
Reaffirmation
1.00 1.00 Short Term BWR A4
BWR A4
Reaffirmation
Non Fund Based 5.00 5.00 Short Term BWR A4
BWR A4
Reaffirmation
Grand Total 9.51 10.28 (Rupees Ten Crores and Twenty Eight 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

BWR has essentially relied on Audited financials upto FY19-20, provisional financial for FY20-21, publicly available information and information & clarifications provided by management. The rating draws comfort from experienced partners with long standing established relationships with clients. However, the rating is constrained by thin profit margins, modest scale of operation and below average financial risk profile. BWR believes that Kay Kay Scaffolding Pvt Ltd (KKSPL) business risk profile will be maintained over the medium term. The 'Stable' outlook indicates a low likelihood of rating change over the medium term

KEY RATING DRIVERS


Credit Strengths:


Credit Risks:

ANALYTICAL APPROACH - Standalone

For arriving at its ratings, BWR has applied its rating methodology as detailed in the Rating Criteria detailed below (hyperlinks provided at the end of this rationale).

RATING SENSITIVITIES

Positive:

1) Substantial and sustainable growth in revenue with stable profitability and higher net cash accrual.
2) Improvement in financial risk profile and better management of liquidity.
Negative:
1) Fall in revenue and deterioration in profit margins with decline in cash accruals.
2) Stretch in the working capital cycle requirements  

LIQUIDITY INDICATORS - Stretched

Net cash accrual to total debt remained low at 7% in Fy19-20. To comfort the liquidity position timely infusing of Covid loan of outstanding amount Rs 82.99 Lakhs has been taken from bank. Current ratio 0.98 times in FY19-20. 

ABOUT THE ENTITY

Kay Kay Scaffolding Pvt Ltd (KKSPL) was incorporated in 2004 as a private limited company by Mr. Kinnar Bhandutia, Mr. Biren Champaneri, Mr. Kantilal Champaneri and Ms. Kirti Kinnar Bhandutia. The Company is engaged in manufacturing of scaffold products, shuttering material and crash barrier. The Company has a manufacturing facility at Valsad, Gujarat with an installed capacity of 8000 Metric Tons Per Annum. 

Initially Mr. Kinnar Bhandutia and Mr. Kantilal (relative of director) had started  a partnership firm named Kay Kay equipments in 1984 which was subsequently closed  down in 2004.

KEY FINANCIAL INDICATORS
Standalone Financial Indicators (in ₹ crore) Units FY 19-20 (A) FY 18-19 (A)
Operating Revenue Rs.Crs. 31.07 24.69
EBITDA Rs.Crs. 1.75 1.67
PAT Rs.Crs. 0.38 0.08
Tangible Net Worth Rs.Crs. 3.58 3.20
Total Debt/Tangible Net Worth Times 2.63 2.72
Current Ratio Times 0.98 0.98
* A:Audited   UA:Unaudited   P:Provisional   PROJ:Projected
Note: These are latest available financial results. All ratios as per BWR's calculations; Amount in ₹ crore
KEY COVENANTS OF THE FACILITY RATED

NA


STATUS OF NON-COOPERATION WITH PREVIOUS CRA

NA

RATING HISTORY FOR THE PREVIOUS THREE YEARS (including withdrawal and suspended)
Facilities Current Rating (2021) 2020 2019 2018
Type Tenure Amount
(Rs.Crs.)
Rating Date Rating Date Rating Date Rating
Fund Based LT 4.28
BWR B+/Stable
(Reaffirmation)
30Jun2020
BWR B+Stable
()
08Mar2019
BWR B+Stable
()
23Apr2018
BWR B+Stable
()
Fund Based ST 1.00
BWR A4
(Reaffirmation)
30Jun2020
BWR A4
()
08Mar2019
BWR A4
()
23Apr2018
BWR A4
()
Non Fund Based LT NA
NA
30Jun2020
BWR B+Stable
()
08Mar2019
BWR B+Stable
()
23Apr2018
BWR B+Stable
()
Non Fund Based ST 5.00
BWR A4
(Reaffirmation)
30Jun2020
BWR A4
()
08Mar2019
BWR A4
()
23Apr2018
BWR A4
()
Grand Total 10.28 (Rupees Ten Crores and Twenty Eight lakhs Only)
COMPLEXITY LEVELS OF THE INSTRUMENTS - NA

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.

Analytical Contacts

Tripti Sharma

Ratings Analyst tripti.s@brickworkratings.com

Dileep Narayan Singh

Director dileep.s@brickworkratings.com
1-860-425-2742 | media@brickworkratings.com
Kay Kay Scaffolding 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.)
1 Bank of Baroda Cash CreditSanctioned 3.36 _ 3.36
2 Bank of Baroda Term LoanOut-standing 0.92 _ 0.92
3 Bank of Baroda Bill Discounted (BD)Sanctioned _ 1.00 1.00
4 Bank of Baroda Letter of CreditSanctioned _ 5.00 5.00
Total 4.28 6.00 10.28
TOTAL (Rupees Ten Crores and Twenty Eight lakhs Only)
Print and Digital Media

The Rating Rationale is sent to you for the sole purpose of dissemination through your print, digital or electronic media. While it may be used by you acknowledging credit to BWR, please do not change the wordings in the rationale to avoid conveying a meaning different from what was intended by BWR. BWR alone has the sole right of sharing (both direct and indirect) its rationales for consideration or otherwise through any print or electronic or digital media.

About Brickwork Ratings

Brickwork Ratings (BWR), a Securities and Exchange Board of India [SEBI] registered Credit Rating Agency and accredited by Reserve Bank of India [RBI], offers credit ratings of Bank Loan, Non- convertible / convertible / partially convertible debentures and other capital market instruments and bonds, Commercial Paper, perpetual bonds, asset-backed and mortgage-backed securities, partial guarantees and other structured / credit enhanced debt instruments, Security Receipts, Securitization Products, Municipal Bonds, etc. BWR has rated over 11,400 medium and large corporates and financial institutions’ instruments. BWR has also rated NGOs, Educational Institutions, Hospitals, Real Estate Developers, Urban Local Bodies and Municipal Corporations. BWR has Canara Bank, a leading public sector bank, as one of the promoters and strategic partner. BWR has its corporate office in Bengaluru and a country-wide presence with its offices in Ahmedabad, Chandigarh, Chennai, Hyderabad, Kolkata, Mumbai and New Delhi along with representatives in 150+ locations.

Disclaimer

Brickwork Ratings India Pvt. Ltd. (BWR), a Securities and Exchange Board of India [SEBI] registered Credit Rating Agency and accredited by the Reserve Bank of India [RBI], offers credit ratings of Bank Loan facilities, Non- convertible / convertible / partially convertible debentures and other capital market instruments and bonds, Commercial Paper, perpetual bonds, asset-backed and mortgage-backed securities, partial guarantees and other structured / credit enhanced debt instruments, Security Receipts, Securitization Products, Municipal Bonds, etc. [ hereafter referred to as "Instruments"]. BWR also rates NGOs, Educational Institutions, Hospitals, Real Estate Developers, Urban Local Bodies and Municipal Corporations.

BWR wishes to inform all persons who may come across Rating Rationales and Rating Reports provided by BWR that the ratings assigned by BWR are based on information obtained from the issuer of the instrument and other reliable sources, which in BWR's best judgment are considered reliable. The Rating Rationale / Rating Report & other rating communications are intended for the jurisdiction of India only. The reports should not be the sole or primary basis for any investment decision within the meaning of any law or regulation (including the laws and regulations applicable in Europe and also the USA).

BWR also wishes to inform that access or use of the said documents does not create a client relationship between the user and BWR.

The ratings assigned by BWR are only an expression of BWR's opinion on the entity / instrument and should not in any manner be construed as being a recommendation to either, purchase, hold or sell the instrument.

BWR also wishes to abundantly clarify that these ratings are not to be considered as an investment advice in any jurisdiction nor are they to be used as a basis for or as an alternative to independent financial advice and judgment obtained from the user's financial advisors. BWR shall not be liable to any losses incurred by the users of these Rating Rationales, Rating Reports or its contents. BWR reserves the right to vary, modify, suspend or withdraw the ratings at any time without assigning reasons for the same.

BWR's ratings reflect BWR's opinion on the day the ratings are published and are not reflective of factual circumstances that may have arisen on a later date. BWR is not obliged to update its opinion based on any public notification, in any form or format although BWR may disseminate its opinion and analysis when deemed fit.

Neither BWR nor its affiliates, third party providers, as well as the directors, officers, shareholders, employees or agents (collectively, "BWR Party") guarantee the accuracy, completeness or adequacy of the Ratings, and no BWR Party shall have any liability for any errors, omissions, or interruptions therein, regardless of the cause, or for the results obtained from the use of any part of the Rating Rationales or Rating Reports. Each BWR Party disclaims all express or implied warranties, including, but not limited to, any warranties of merchantability, suitability or fitness for a particular purpose or use. In no event shall any BWR Party be liable to any one for any direct, indirect, incidental, exemplary, compensatory, punitive, special or consequential damages, costs, expenses, legal fees, or losses (including, without limitation, lost income or lost profits and opportunity costs) in connection with any use of any part of the Rating Rationales and/or Rating Reports even if advised of the possibility of such damages. However, BWR or its associates may have other commercial transactions with the company/entity. BWR and its affiliates do not act as a fiduciary.

BWR keeps certain activities of its business units separate from each other in order to preserve the independence and objectivity of the respective activity. As a result, certain business units of BWR may have information that is not available to other BWR business units. BWR has established policies and procedures to maintain the confidentiality of certain non-public information received in connection with each analytical process.

BWR clarifies that it may have been paid a fee by the issuers or underwriters of the instruments, facilities, securities etc., or from obligors. BWR's public ratings and analysis are made available on its web site, www.brickworkratings.com. More detailed information may be provided for a fee. BWR's rating criteria are also generally made available without charge on BWR's website.

This disclaimer forms an integral part of the Ratings Rationales / Rating Reports or other press releases, advisories, communications issued by BWR and circulation of the ratings without this disclaimer is prohibited.

BWR is bound by the Code of Conduct for Credit Rating Agencies issued by the Securities and Exchange Board of India and is governed by the applicable regulations issued by the Securities and Exchange Board of India as amended from time to time.