RATING RATIONALE
14Jul2022

Manish Packaging Pvt. Ltd.

Brickwork Ratings reaffirms the ratings for the Bank Loan Facilities of Rs. 36.24 Crs. of Manish Packaging Pvt. Ltd. ('MPPL' or 'The company')

Particulars
Facilities** Amount (Rs.Crs.) Tenure Rating#
Previous Present Previous
(07 May 2021)
Present
Fund Based 10.00 10.00 Long Term BWR BBB+ /Stable
Reaffirmation
BWR BBB + /Stable
Reaffirmation
Non Fund Based 26.24 26.24 Short Term BWR A2+
Reaffirmation
BWR A2 +
Reaffirmation
Grand Total 36.24 36.24 (Rupees Thirty Six Crores and Twenty Four 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 (BWR) has reaffirmed its 'BWR BBB+/Stable/BWR A2+' rating on the bank facilities of Manish Packaging Private Limited (MPPL).

The ratings continue to reflect the company's established and diversified presence in the industry supported by the extensive experience of the promoters, its robust financial risk profile and efficiently managed working capital. These rating strengths are partially offset by its moderate scale of operations, exposure to risks related to volatility in raw material prices, and customer concentration in the revenues

 

Outlook: Stable

BWR believes that the company will maintain its robust financial risk profile over the medium term, supported by low incremental working capital requirements, and healthy profitability. The Stable outlook indicates a low likelihood of a change in rating over the medium term.

 

KEY RATING DRIVERS

Credit Strengths:


Credit Risks:

ANALYTICAL APPROACH - Standalone

For arriving at its ratings, BWR has considered MPPL’s standalone financials and applied its rating methodology as detailed in the Rating Criteria

RATING SENSITIVITIES

Positive

 

Negative

LIQUIDITY INDICATORS - Strong

 

Liquidity is strong, The company is expected to generate cash accruals of over Rs 35 crore in FY23 and FY24 against nil term debt obligations. The fund-based working capital limits are seldomly utilised. The company has unencumbered cash balances of over Rs 5.5 crore to meet any exigencies and additionally has liquid investments of over Rs 79 crore as on March 31, 2022. The promoters also provide need-based fund support through unsecured loans as and when required. The current ratio is robust at over 6 times as on March 31, 2022.

ABOUT THE ENTITY

MPPL was set up in 1970 in Surat (Gujarat) by Mr. Kanaiyalal Patel as a proprietorship concern and was converted into a private Limited company in 1997. The company is engaged in manufacturing and marketing flexible packaging material, used in the packaging of food, FMCG products, consumer goods, etc. The company manufactures a variety of PVC & CoPet films, including laminates, cast-shrink, twist-wrap, and heat-sealable and metalized films. It has in-house metalizing and printing process capability creating value addition. The raw materials used by the company are both indigenous and imported. It has three manufacturing units in Surat district and one manufacturing facility in Navsari District and is equipped with in-house R & D facilities. The company currently operates 6 units of windmills, each with an annual capacity of 0.8 MW, majorly for captive consumption.

KEY FINANCIAL INDICATORS (Standalone)
Key Parameters Units FY 20-21
(Audited)
FY 19-20
(Audited)
Operating Revenue Rs.Crs. 191.71 172.41
EBITDA Rs.Crs. 43.72 24.00
PAT Rs.Crs. 27.86 11.86
Tangible Net Worth Rs.Crs. 187.30 159.44
Total Debt/TNW Times 0.01 0.03
Current Ratio Times 2.38 2.92

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 10.00
BWR BBB+/Stable
(Reaffirmation)
07May2021
BWR BBB+ Stable
(Reaffirmation)
16Jan2020
BWR BBB+Stable
(Reaffirmation)
NA
NA
Non Fund Based ST 26.24
BWR A2+
(Reaffirmation)
07May2021
BWR A2+
(Reaffirmation)
16Jan2020
BWR A2+
(Reaffirmation)
NA
NA
Grand Total 36.24 (Rupees Thirty Six Crores and Twenty Four lakhs 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

Arbez Noshir Karbhari

Ratings Analyst arbez.k@brickworkratings.com

Chintan Dilip Lakhani

Director- Ratings chintan.l@brickworkratings.com
1-860-425-2742 | media@brickworkratings.com
Manish Packaging 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 HDFC Bank Letter of CreditSanctioned _ 10.00 10.00
2 State Bank Of India (SBI) Credit Exposure Limit (CEL)Sanctioned _ 1.24 1.24
3 State Bank Of India (SBI) FBWC (CC/EPC/FBD/FBP)Sanctioned 1.00 _ 1.00
4 State Bank Of India (SBI) EPC/PCFC/BDSanctioned 9.00 _ 9.00
5 State Bank Of India (SBI) Letter of CreditSanctioned _ 15.00 15.00
Total 10.00 26.24 36.24
TOTAL (Rupees Thirty Six Crores and Twenty Four 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 11,541 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.