RATING RATIONALE
27Oct2022

Narender Dev (Railways)

Brickwork Ratings upgrades the long term and reaffirms the short term ratings for the Bank Loan Facilities of Rs. 31.36 Crs. of Narender Dev (Railways)

Particulars
Facilities** Amount (Rs.Crs.) Tenure Rating#
Previous Present Previous
(10 Jun 2022)
Present
Fund Based 16.68 14.86 Long Term BWR B-/Stable
ISSUER NOT COOPERATING*/Downgraded
BWR BB - /Stable
Upgrade
Non Fund Based 16.50 16.50 Short Term BWR A4
ISSUER NOT COOPERATING*/Reaffirmed
BWR A4
Reaffirmation
Grand Total 33.18 31.36 (Rupees Thirty One Crores and Thirty 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
Note: This rating pertains to an existing assignment received prior to 6th October 2022. *Issuer did not cooperate; based on best available information


RATING ACTION / OUTLOOK

Brickwork upgraded the long term and reaffirmed the short term rating of Narender dev (Railways) as BWR BB-/A4 with Stable outlook. Their business risk profile will be maintained over the medium term. The 'Stable' outlook indicates a low likelihood of rating change over the medium term. It continues to factor the extensive experience of the promoters in the civil construction and established relationships to get the new tender contracts. The ratings also positively factor by its improving of scale of operations as the operations of the business. However, these rating strengths remain constrained due to highly competitive industry and exposure to fluctuations in the raw material price.  The rating outlook may be revised to 'Positive' in case the revenues and profit show sustained improvement. The rating outlook may be revised to 'Negative' if the revenues go down and profit margins show lower than expected figures.

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

Going forward, the ability of the company to improve its scale of operations, reduction in operating expenses, improve its profitability margins, the debt servicing capability & liquidity would be key rating sensitivities.

Upgrade : The rating may be revised for an upgrade if the company is able to achieve significant growth in revenue along with a significant improvement in profit margins, DSCR/ISCR ratio.

Downgrade : The rating may be revised negatively if revenue and profit margins substantially deteriorate from current level and if there is an overall deterioration in the financial risk profile of the entity. Any additional borrowing by the company may lead to further deterioration in debt protection metrics and profit margins.

LIQUIDITY INDICATORS - Stretched

Hence, the overall liquidity of the company is stretched.

ABOUT THE ENTITY

Narender Dev (Railways) is a partnership firm established in the year 1965 by Late Shri Narendra Dev Gupta. Now, the firm is managed by Mr. Ajay Kumar Agarwal, Mr. Maheshwar Dayal, Ms Mansi Agarwal, Mr. Madhup Gupta and Mr. Ashish Agarwal. The firm is engaged in the construction and maintenance of civil works including construction of main line railway tracks, platforms, railway siding, pre stressed (Prestressed concrete is a method for overcoming concrete's natural weakness in tension) concrete structures, girder and pipeline bridges, and other construction work for North Eastern Railways, North Central Railways and U.P. Avas Vikas Parishad (Registered in section ‘A’).

KEY FINANCIAL INDICATORS (Standalone)
Key Parameters Units FY 21-22
(Audited)
FY 20-21
(Audited)
Operating Revenue Rs.Crs. 62.24 49.09
EBITDA Rs.Crs. 5.78 4.94
PAT Rs.Crs. 1.38 0.82
Tangible Net Worth Rs.Crs. 25.63 23.26
Total Debt/TNW Times 0.73 0.97
Current Ratio Times 1.96 2.34

STATUS OF NON-COOPERATION WITH PREVIOUS CRA

ICRA continues the rating of Narender Dev under Issuer Non Cooperation category as B+/A4 on 20th September 2021.

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 14.86
BWR BB-/Stable
(Upgrade)
10Jun2022
BWR B-Stable
(ISSUER NOT COOPERATING*/Downgraded)
25Jun2021
BWR B Stable
(Downgrade/ISSUER NOT COOPERATING*)
28Mar2020
BWR BB- Stable
(Reaffirmed)
NA
NA
Non Fund Based ST 16.50
BWR A4
(Reaffirmation)
10Jun2022
BWR A4
(ISSUER NOT COOPERATING*/Reaffirmed)
25Jun2021
BWR A4
(Downgrade/ISSUER NOT COOPERATING*)
28Mar2020
BWR A4
(Reaffirmed)
NA
NA
Grand Total 31.36 (Rupees Thirty One Crores and Thirty Six 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

Kartik Arora

Ratings Analyst kartik.a@brickworkratings.com

Hari Kishan Yadav

Associate Director - Ratings hari.ky@brickworkratings.com
1-860-425-2742 | media@brickworkratings.com
Narender Dev (Railways)
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 Punjab National Bank Cash CreditSanctioned 14.68 _ 14.68
2 Punjab National Bank Over DraftSanctioned _ _ 0.00
3 Punjab National Bank Bank GuaranteeSanctioned _ 16.50 16.50
Total 14.86 16.50 31.36
TOTAL (Rupees Thirty One Crores and Thirty Six lakhs Only)
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