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| Product | Quantum (Rs. Cr) | Long Term Rating | Short Term Rating |
| Bank Loan Ratings | 18.00 | ACUITE BB+ | Stable | Downgraded | - |
| Bank Loan Ratings | 120.00 | - | ACUITE A4+ | Downgraded |
| Total Outstanding | 138.00 | - | - |
| Total Withdrawn | 0.00 | - | - |
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Rating Rationale |
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Acuite has downgraded the long-term rating to 'ACUITE BB+' (read as ACUITE double B plus) from 'ACUITE BBB-' (read as ACUITE triple B minus) and short-term rating to 'ACUITE A4+' (read as ACUITE A four plus) from 'ACUITE A3' (read as ACUITE A three) on Rs.138.00 crore bank loan facilities of Bohra Exports Private Limited (BEPL). The outlook is 'Stable'.
Rationale for rating The rating downgrade considers the deterioration in core operational activities marked by decline in scale of operations and profitability margins in FY25. The rating continues to be supported by average financial risk profile marked by moderate net worth, comfortable debt protection metrics and no outstanding debt. The liquidity of the company stood adequate with sufficient net cash accruals and nil bank limit utilization. The rating also continues to derive strength from extensive experience of the management, though the working capital-intensive nature of industry and highly cyclical & fragmented nature of the industry constrains the rating. |
| About the Company |
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Mumbai based Bohra Exports Private Limited (BEPL) was incorporated in 1986 by Mr. Pratap Bohra. It was initially engaged in trading of commodities and chemicals. In 1992, it entered in the business of ship breaking. The company has also ventured into purchasing assets for recycling and asset stripping. The company undertakes ship recycling activities at its 3015 sq. meters plot at Alang, Gujarat. It has a capacity of recycling 60,000 tons per annum. BEPL has recently diversified into trading business involving the procurement of Mobile Phones (primarily Apple iPhone) from leading authorised distributors in India. Initially the company started trading locally and thereafter started exporting the same to customers in Dubai and the broader UAE market. The company managed by Mr. Pratap Singh Bohra, Mr. Vivek Bohra and Mr. Nikhil Bohra.
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| Unsupported Rating |
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Not Applicable
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| Analytical Approach |
| Acuite has taken a standalone approach to arrive at the rating of BEPL |
| Key Rating Drivers |
| Strengths |
| Established presence of promoters in ship recycling industry and location advantage
The management is engaged in ship recycling and asset stripping business for more than two decades. It has recycled over 50 ships till date. The long presence of the management in the industry has resulted in establishing healthy relationship with its customers. Further, the company has locational advantage as its operations are conducted at Alang, Gujarat, which is the world’s biggest ship breaking yard ensuring easy availability of the labour at cheaper prices as well as ready market for selling the scrap. BEPL has recently diversified into trading business involving the procurement of Mobile Phones (primarily Apple iPhone) from leading authorised distributors in India. Initially the company started trading locally and thereafter started exporting the same to customers in Dubai and the broader UAE market. Acuité believes that BEPL will continue to benefit from its established track record of operations and experienced management. Above average financial risk profile The financial risk profile of the company remained above average with moderate net worth, comfortable debt protection metrics and no outstanding debt. The tangible net worth of the company increased and stood at Rs. 46.89 Cr. as on 31st March 2025 as against Rs. 44.69 Cr. as on 31st March 2024 on account of accretion of profits to reserves. The company does not have any outstanding debt since there has been no utilization of short-term bank limits by the company, as business activity was limited and working capital requirements were met through internal accruals. Debt protection metrics of the company stood comfortable with debt service coverage ratio (DSCR) at 3.53 times in FY25 as against 2.34 times in FY24. Interest coverage ratio (ICR) stood at 4.29 times in FY25 as against 2.79 times in FY24. Acuité believes that the financial risk profile of the company is expected to remain moderate with no major debt funded capital expenditure planned in near term. |
| Weaknesses |
| Decline in scale of operations and profitability margins
BEPL has reported a significant decline in sales for FY25 which stood at Rs. 47.34 Cr. in FY25 as compared to Rs. 78.17 Cr in FY24, reflecting a YoY decline of 39.44 percent during the same period. The decline is attributed to the absence of ship breaking activities throughout the year, primarily due to the unavailability of ships in the international market. The company has booked revenue of ~Rs. 100 crores till November 2025 out of which Rs. 75 crore is from the export of Apple mobile devices, while Rs. 25 crore is from plant dismantling activities. Company’s operating profit significantly declined to Rs. 1.25 Cr. in FY25 from Rs. 8.61 Cr. in FY24. EBITDA margins declined and stood at 2.62 percent in FY25 as compared to 11.01 percent in FY24. EBITDA margins were higher in FY 2023–24 as dismantling began with selling high-value components, which yield better margins. Later stages involve low-value scrap, leading to margin decline. Also, the PAT margins declined and stood at 4.65 percent in FY25 as against 6.19 percent in FY24. Acuite believes, the operating performance of the company would remain volatile over the medium term due to uncertainties associated with the unrelated business risk profile. Working capital intensive operations Working capital operations of the company remained intensive with gross current assets (GCA) of 197 days in FY25 as against 139 days in FY24. GCA days are driven majorly by other current assets. While the GCA days of the company are volatile, the working capital cycle of the company remains efficient at 02 days in FY25 as against 06 days in FY24. Acuité believes that the working capital cycle of the company will continue to remain volatile and intensive given the nature of the industry. Exposure to risks related to cyclical and fragmented industry along with fluctuating revenues The shipbreaking industry is cyclical, and the viability of the business is inversely correlated with the international freight index. The company has to compete with the small players during limited availability of vessels and other assets. Domestic players also face competition from shipbreakers in China, Bangladesh, and Pakistan. Further, due to the tender based operations, revenues are majorly dependent on the winning of the contract which results in the fluctuation in operating performance. |
| Rating Sensitivities |
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Sustain improvement in the scale of operations and profitability margins
Deterioration in working capital management leading to stretched liquidity Changes in financial risk profile |
| Liquidity Position |
| Adequate |
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The liquidity of the company remained adequate with sufficient net cash accruals and nil bank limit utilization. BEPL Letter of credit for purchase of ships remains unutilized as the company has not purchased any ships. Further, liquid fund investment with the company as on 31st March 2025 stood at ~Rs. 11.00 Cr. and Cash and bank balance stood at Rs. 18.53 Cr. as on 31st March 2025. Acuité believes that the liquidity of the company is likely to remain adequate over the medium term on account of average cash accruals against no major debt repayments over the medium term.
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| Outlook: Stable |
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| Other Factors affecting Rating |
| None |
| Particulars | Unit | FY 25 (Actual) | FY 24 (Actual) |
| Operating Income | Rs. Cr. | 47.34 | 78.17 |
| PAT | Rs. Cr. | 2.20 | 4.84 |
| PAT Margin | (%) | 4.65 | 6.19 |
| Total Debt/Tangible Net Worth | Times | 0.00 | 0.81 |
| PBDIT/Interest | Times | 4.29 | 2.79 |
| Status of non-cooperation with previous CRA (if applicable) |
| Not Applicable |
| Any other information |
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None
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| Applicable Criteria |
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• Default Recognition :- https://www.acuite.in/view-rating-criteria-52.htm • Application Of Financial Ratios And Adjustments: https://www.acuite.in/view-rating-criteria-53.htm • Trading Entities: https://www.acuite.in/view-rating-criteria-61.htm |
| Note on complexity levels of the rated instrument |
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