Brickwork Ratings revises the ratings for the Bank Loan Facilities of Rs. 45.33 Crs. of Whitelotus Industries Limited
Particulars| Facilities** | Amount (Rs.Crs.) | Tenure | Rating# | ||
|---|---|---|---|---|---|
| Previous | Present | Previous (12 May 2022) |
Present | ||
| Fund Based | 48.77 | 45.33 | Long Term |
BWR BB /Stable
Downgrade/ISSUER NOT COOPERATING* |
BWR BB +
/Stable Upgrade |
| Non Fund Based | (1.58) | (1.58) | Short Term |
BWR A4
Downgrade/ISSUER NOT COOPERATING* |
BWR A4 +
Upgrade |
| (0.95) | (0.95) | ||||
| (1.38) | (1.38) | ||||
| (0.83) | (0.83) | ||||
| (5.00) | (1.22) | ||||
| (5.05) | (1.22) | ||||
| (3.75) | (0.00) | ||||
| Grand Total | 48.77 | 45.33 | (Rupees Forty Five Crores and Thirty Three lakhs Only) | ||
BWR has considered the standalone financials of the Company (Or hereinafter referred as "WLIPL") and essentially relied upon the audited financial statements up to FY21, Management certified provisional financials for FY22, Projected financials and publicly available information and clarifications provided by the entity management.
The rating revision is based on moderate scale of operation during the last fiscal and adequate liquidity position. Also, the rating favorably factor in the extensive experience of promoters in the packaging industry and catering to multiple industries. These strengths are partially offset by vulnerability to volatility in raw material prices. The ratings further consider the impact of covid pandemic on the business during FY21 and deterioration in gearing, however the tangible net worth remains at comfortable level.
BWR believes that the 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 DRIVERSCredit Strengths:
WLPL has an established track record of two decades in a variety of flexible packaging business catering to FMCG, textile and other industries. The Company is managed by Mr Sumant Kumar Jalan and his family having extensive experience in the line of activity. The Company has established a market position in different geographies and longstanding relations with clients.
The company has reported a total operating income (TOI) of Rs. 129.80 Crs on a provisional basis in FY22. Although the operations of the Company were impacted due to Covid pandemic, the entity managed to achieve Rs.93.41 Crs in FY21 and clock sales of ~ Rs 111.36 Cr for the previous financial year. As per management certified financials, the company has achieved a total operating income of Rs. 44.21 Crs in the first quarter of FY23. This provides sufficient revenue visibility for the company for the remaining year.
The Company's overall financial risk profile is deteriorated as depreciation and finance cost remained at higher side owing to capex post during covid pandemic in FY21 . This impacted the profit margins negatively in the last fiscal FY21. Tangible net worth level is relatively comfortable at Rs. 17.34 Crs as on 31st March, 2021. The overall gearing stood high at 3.31x in FY20 & 3.56X in FY21. Debt protection metrics are weak due to weak profitability i,e DSCR at 0.84x and ISCR at 1.54x in FY21. Going further, the company's ability to improve the profitability and timely repayment of debts resulting in lower gearing will remain a key rating sensitivity.
BOPP industry is highly fragmented and exposed to stiff competition by large players. Profitability is also vulnerable as key raw material, is a derivative of crude and hence, susceptible to volatility in crude prices.
Positive: Substantial growth in revenue and profitability leading to higher than expected cash accruals, improvement in the gearing from existing level.
Negative: De-growth in profitability resulting in lower-than-expected cash accruals, stretch in working capital cycle leading to adverse debt protection metrics, and further weakened liquidity profile of the company
LIQUIDITY INDICATORS - Adequate
The net cash accruals are marginally reduced from Rs.4.90 Crs in FY20 and Rs. 3.38 Crs in FY21. The current ratio is comfortable at 1.45x as on 31st March, 2021. Average cash credit utilization is around 88-90% in the past six months ending on 31st May 2022.Further, the working capital cycle is elongated from 102 to 153 days due to covid pandemic, which improved to 111 days on a provisional basis in FY22.Liquidity is supported by availment of covid line of emergency credit, moratorium benefit and opted for one time restructuring under the Resolution Framework scheme offered by the RBI. This will provide the liquidity cushion to run the business operations smoothly.
ABOUT THE ENTITYWhitelotus Industries Ltd was incorporated on 18th April 2011 for manufacturing complete flexible packaging products like laminates made of various combinations of Polyester, BOPP, Poly Metalized films, etc in several sizes and profiles. The corporate office and manufacturing facilities are located at Palsana, Surat, Gujarat. The total installed capacity is 5400 Metric Ton per anum for flexible packaging and 4200 Metric Ton per anum for Laquered Film.
| Standalone Financial Indicators (in ₹ crore) | Units | FY 20-21 (A) | FY 19-20 (A) | |
|---|---|---|---|---|
| Operating Revenue | Rs.Crs. | 93.41 | 111.36 | |
| EBITDA | Rs.Crs. | 9.71 | 9.09 | |
| PAT | Rs.Crs. | -0.02 | 1.45 | |
| Tangible Net Worth | Rs.Crs. | 17.34 | 17.31 | |
| Total Debt/TNW | Times | 3.56 | 3.31 | |
| Current Ratio | Times | 1.45 | 1.27 | |
|
* A:Audited UA:Unaudited P:Provisional PROJ:Projected
|
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|
Note: These are latest available financial results. All ratios as per BWR's calculations; Amount in ₹ crore
|
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Acuite Ratings published the rating as ACUITE B+ (Stable), Issuer not co-operating dated April 28, 2021 for a total debt size of Rs. 35 Crs
RATING HISTORY FOR THE PREVIOUS THREE YEARS (including withdrawal and suspended)| Facilities | Current Rating (2022) | 2022 (History) | 2021 | 2020 | 2019 | ||||||
|---|---|---|---|---|---|---|---|---|---|---|---|
| Type | Tenure | Amount (Rs.Crs.) |
Rating | Date | Rating | Date | Rating | Date | Rating | Date | Rating |
| Fund Based | LT | 45.33 |
BWR BB+/Stable
(Upgrade) |
12May2022 |
BWR BB Stable
(Downgrade/ISSUER NOT COOPERATING*) |
24May2021 |
BWR BB+ Stable
(Reaffirmation) |
16Mar2020 |
BWR BB+ Stable
(Upgrade) |
NA |
NA
|
| Non Fund Based | ST | 0.00 |
NA
|
12May2022 |
BWR
() |
NA |
NA
|
NA |
NA
|
NA |
NA
|
| NFB SubLimit | ST | (1.58) |
BWR A4+
(Upgrade) |
12May2022 |
BWR A4
(Downgrade/ISSUER NOT COOPERATING*) |
24May2021 |
BWR A4+
(Reaffirmation) |
16Mar2020 |
BWR A4+
(Assignment) |
NA |
NA
|
| NFB SubLimit | ST | (0.95) |
BWR A4+
(Upgrade) |
NA |
NA
|
NA |
NA
|
NA |
NA
|
NA |
NA
|
| NFB SubLimit | ST | (1.38) |
BWR A4+
(Upgrade) |
NA |
NA
|
NA |
NA
|
NA |
NA
|
NA |
NA
|
| NFB SubLimit | ST | (0.83) |
BWR A4+
(Upgrade) |
NA |
NA
|
NA |
NA
|
NA |
NA
|
NA |
NA
|
| NFB SubLimit | ST | (1.22) |
BWR A4+
(Upgrade) |
NA |
NA
|
NA |
NA
|
NA |
NA
|
NA |
NA
|
| NFB SubLimit | ST | (1.22) |
BWR A4+
(Upgrade) |
NA |
NA
|
NA |
NA
|
NA |
NA
|
NA |
NA
|
| Grand Total | 45.33 | (Rupees Forty Five Crores and Thirty Three 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.
Hyperlink/Reference to applicable Criteria| Analytical Contacts | |
|---|---|
|
Kunjal Dabhi Rating Analyst Board : +91 79 66174046 / 47 kunjal.r@brickworkratings.com |
Dileep Narayan Singh Director dileep.s@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 | Bank of Baroda | Term LoanSanctioned | 4.02 | _ | 4.02 | |
| 2 | Bank of Baroda | Working Capital Term LoanSanctioned | _ | _ | 0.00 | |
| 3 | Bank of Baroda | Cash CreditSanctioned | 8.20 | _ | 8.20 | |
| Sub-Limit (Inland/Import LC ) Sanctioned | (1.58) | |||||
| Sub-Limit (PC/PCFC W/W FDBP/FUDBP) Sanctioned | (0.95) | |||||
| 4 | Bank of Baroda | Covid -19 Emergency Line CreditSanctioned | 4.05 | _ | 4.05 | |
| 5 | Punjab National Bank | Covid -19 Emergency Line Credit | 2.93 | _ | 2.93 | |
| 6 | Punjab National Bank | Cash CreditSanctioned | 11.75 | _ | 11.75 | |
| Sub-Limit (CC (BD)) Sanctioned | (0.00) | |||||
| Sub-Limit (Inland/Import LC ) Sanctioned | (1.22) | |||||
| Sub-Limit (PC/PCFC W/W FDBP/FUDBP) Sanctioned | (1.22) | |||||
| 7 | Punjab National Bank | Funded Interest Term LoanSanctioned | _ | _ | 0.00 | |
| 8 | Punjab National Bank | Term LoanSanctioned | 0.65 | _ | 0.65 | |
| 9 | Punjab National Bank | Working Capital Term LoanSanctioned | _ | _ | 0.00 | |
| 10 | Union Bank of India | Cash CreditSanctioned | 8.05 | _ | 8.05 | |
| Sub-Limit (Inland/Import LC ) Sanctioned | (1.38) | |||||
| Sub-Limit (PC/PCFC W/W FDBP/FUDBP) Sanctioned | (0.83) | |||||
| 11 | Union Bank of India | Working Capital Term LoanSanctioned | _ | _ | 0.00 | |
| 12 | Union Bank of India | Term LoanSanctioned | 2.75 | _ | 2.75 | |
| 13 | Union Bank of India | Funded Interest Term LoanSanctioned | _ | _ | 0.00 | |
| 14 | Union Bank of India | Covid -19 Emergency Line CreditSanctioned | 2.93 | _ | 2.93 | |
| Total | 45.33 | 0.00 | 45.33 | |||
| TOTAL (Rupees Forty Five Crores and Thirty Three lakhs Only) | ||||||
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