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| Product | Quantum (Rs. Cr) | Long Term Rating | Short Term Rating |
| Bank Loan Ratings | 36.00 | ACUITE BB- | Stable | Reaffirmed | - |
| Total Outstanding | 36.00 | - | - |
| Total Withdrawn | 0.00 | - | - |
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Rating Rationale |
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Acuite has reaffirmed its long term rating of "ACUITE BB-"(read as ACUITE double B minus) on the bank facilities of Rs.36 Crore of Sheera's Crystal House. The outlook is 'Stable'.
Rationale for rating The rating reaffirmation factors the below average financial risk profile, intensive working capital management and presence of entity in a fragmented industry that remains susceptible to agro-climatic risks. The rating also reflects stretched liquidity position and negative PAT margins reported in FY2025. However, the rating positively considers promoter’s experience in this industry and the significant improvement in scale of operations during FY2025. This momentum has moderated in FY2026, with the firm achieving revenues of Rs 59.09 Cr. upto January 2026. Going ahead, the firm’s ability to sustain steady growth in revenue while maintaining stable profitability margins will remain a key monitorable. |
| About the Company |
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Sheera’s Crystal House is a proprietorship concern of Mr. Avtar Singh, based in Amritsar, Punjab. The firm was established on March 01, 2020 and was engaged solely in the trading of rice and paddy. Business operations commenced in September 2020. Further in FY2022, it acquired a rice milling unit through an auction, and the milling operations became functional in FY2023 with an installed production capacity of 12 tonnes per hour. The installed capacity was subsequently enhanced to 15 tonnes per hour in FY2024. The procurement of paddy for milling, processing, and trading is carried out during the harvesting season, which typically spans from mid-September to mid-January.
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| Unsupported Rating |
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Not applicable
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| Analytical Approach |
| Key Rating Drivers |
| Strengths |
| Experienced management
The firm is promoted by Mr. Avtar Singh, who possesses extensive experience and understanding of the rice milling and trading industry for over two decades. Over the years he has gained expertise in procurement, processing in rice mill industry. Acuite believes that the promoter’s experience and active involvement in day-to-day business operations will continue to drive growth in the medium term. |
| Weaknesses |
| Volatile revenues and rangebound margins
The firm reported revenues of Rs 115.31 Cr. in FY2025, registering a growth of 43.62 percent over Rs 80.29 Cr. in FY2024. Revenue levels have remained volatile over the last three fiscals, with the topline previously stood at Rs 74.99 Cr. in FY2023. This improvement in FY2025 topline is primarily attributable to higher sales volumes, even though the firm witnessed a decline in price realisation coupled with moderation in production capacity during the year. However, the revenue moderated in FY2026 owing to subdued demand conditions in the rice industry, achieved revenues of Rs 59.09 Cr. upto January 2026. The operating margins remain rangebound between 4-5 percent, moderated to 4.64 percent in FY2025 from 5.69 percent in FY2024, primarily on account of an increase in procurement costs during the year. Further, the firm reported a net loss of Rs 0.22 Cr. in FY2025 as against a PAT of Rs 0.15 Cr. (0.18 percent of revenue) in FY2024. The deterioration in profitability is attributable to the decline in operating margins coupled with higher finance costs, arising from the availment of a vehicle loan and increase in short term debt during the year. Acuité believes that the ability of the firm to improve its scale of operations and profitability margins will remain a key monitorable over the medium term. Below average financial risk profile The financial risk profile of the firm remains below average marked by low networth base, high gearing and weak debt protection metrics. The net worth of the firm stood at Rs 10.87 Cr. as on March 31,2025 (Rs 10.97 Cr. as on March 31, 2024). Total debt increased to Rs 68.84 Cr. as on March 31,2025 from Rs 62.87 Cr. as on March 31,2024 driven by infusion of non-interest-bearing unsecured loans, the availment of a vehicle loan, increase in short-term borrowings during the year. Consequently, the gearing remained elevated at 6.33 times as on March 31,2025 (5.73 times as on March 31,2024). Debt-protection metrics also remained subdued, with the interest coverage ratio and debt service coverage ratio of the firm stood at 1.26 times and 0.93 times as on March 31,2025 (1.45 times and 1.06 times as on March 31,2024). Working capital intensive operations The working capital operations of the firm though improved remains intensive with gross current assets (GCA) days of 213 days in FY2025 (279 days in FY2024). The GCA days continue to remain on the higher side due to an increase in receivable days, moderate inventory holding and balance being tied up in other current assets consist of balances with government authorities, loans & advances extended to related parties. The inventory days moderated to 98 days as on March 31, 2025 compared to 274 days as on March 31,2024. The elevated inventory position in FY2024 was due to a crisis of unsold stock, which was subsequently liquidated during FY2025. However, debtors days has increased to 103 days as on March 31,2025 from 11 days as on March 31,2024 reflecting elongated receivable cycles during the year. Acuité believes that the firm’s working capital cycle will remain elongated over the near to medium term, driven by structurally high inventory levels and stretched receivables. Commodity price fluctuations Paddy, the main raw material required for rice is a seasonal crop and production of the same is highly dependent upon monsoon season. Environmental factors, fertility of soil and seasonal monsoon control the output of the paddy cultivation affecting the demand supply dynamics of basmati/non-basmati rice year-on-year resulting in price flux. Furthermore, paddy price is largely dependent on several external factors like domestic demand outlook, international trade regulations and domestic productions. This exposes the company to the risk related with fluctuation in raw material price. |
| Rating Sensitivities |
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| Liquidity Position |
| Stretched |
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The liquidity position of the firm remains stretched, as net accruals stood at Rs 1.11 Cr. against the debt repayment obligations of Rs 1.51 Cr. as on March 31,2025. The shortfall has been met through infusion of unsecured loans by the promoter. Going forward, the firm is expected to generate net cash accruals under the range of Rs.1.45 Cr. to Rs 1.70 Cr. against the debt obligation of Rs 2.00 Cr. to 2.15 Cr. for the same period in near future, shortfall is expected to be met through unsecured loans by promoter. The cash and bank balance stood at Rs 1.29 Cr. while current ratio stood moderate at 1.33 times as on March 31,2025. Further, the average bank limit utilization of the firm stood moderate at 87.55 percent in last 11 months ending January 2026.
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| Outlook-Stable |
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| Other Factors affecting Rating |
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None
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| Particulars | Unit | FY 25 (Actual) | FY 24 (Actual) |
| Operating Income | Rs. Cr. | 115.31 | 80.29 |
| PAT | Rs. Cr. | (0.22) | 0.15 |
| PAT Margin | (%) | (0.19) | 0.18 |
| Total Debt/Tangible Net Worth | Times | 6.33 | 5.73 |
| PBDIT/Interest | Times | 1.26 | 1.45 |
| Status of non-cooperation with previous CRA (if applicable) |
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Not applicable
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| 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 • Manufacturing Entities: https://www.acuite.in/view-rating-criteria-59.htm • Application Of Financial Ratios And Adjustments: https://www.acuite.in/view-rating-criteria-53.htm |
| Note on complexity levels of the rated instrument |
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