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| Product | Quantum (Rs. Cr) | Long Term Rating | Short Term Rating |
| Bank Loan Ratings | 48.00 | ACUITE A | Stable | Assigned | - |
| Bank Loan Ratings | 78.00 | ACUITE A | Stable | Reaffirmed | - |
| Total Outstanding | 126.00 | - | - |
| Total Withdrawn | 0.00 | - | - |
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Rating Rationale |
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Acuité has reaffirmed its long-term rating of ‘ACUITE A’ (read as ACUITE A) on the Rs 78.00 Cr. bank facilities of Fine Components and Tools Private Limited (FCTPL). The outlook is 'Stable'.
Acuité has assigned its long-term rating of ‘ACUITE A’ (read as ACUITE A) on the Rs 48.00 Cr. bank facilities of Fine Components and Tools Private Limited (FCTPL). The outlook is 'Stable'. Rationale for reaffirmation The rating reaffirmation considers FCTPL’s steady business in FY2025 and the same being sustained in 9MFY2026 along with experienced management. Further, the rating continues to derive strength from the company's long-term presence in the market for more than two and a half decades and its established relations with the customers, which fetch repeated orders. The financial risk profile of FCTPL continues to be healthy with healthy capital structure, strong debt protection metrics and low gearing along with strong liquidity position. However, the rating is constrained by the competitive nature of auto ancillary industry and the susceptibility to the cyclicality in automotive industry. |
| About the Company |
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Fine Components and Tools Private Limited (FCTPL) was established in 1994 in Bangalore as a proprietorship concern and was later converted into a private limited company in 1997. The company is led by Directors Mr. Chinnatambi Krishnamoorthy and Mr. Gopinath Krishnamoorthy. The company is engaged in manufacturing of automobile mould and components (four-wheeler segment) such as sheet metal pressed, sheet-metal stampings and welded assemblies. These include parts of Seat Belt Frames, Seat Rail & Side Frame, Buckle Straps, Seat Folding Hinges, Air Bag Containers, Air Bag Retainer Rings, Arm Rest, and Axle Housing etc. The company operates five manufacturing units with an installed capacity to process 3,500 MT of steel per month, of which it currently utilizes about 2,400–2,500 MT monthly. The company supplies components directly to major OEMs such as Toyota and Maruti Suzuki, with a larger portion of its business stemming from supplies to Tier-1 vendors, who in turn supply OEMs. FCTPL has also scaled up its business with Autoliv, a Swedish multinational specializing in airbags and seatbelts, providing safety-critical sheet metal components used in airbag inflators.
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| Unsupported Rating |
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Not Applicable
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| Analytical Approach |
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Acuité has considered the standalone business and financial risk profiles of FCTPL to arrive at the rating.
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| Key Rating Drivers |
| Strengths |
| Experienced management and reputed clientele
FCTPL was established in 1994, based out of Bangalore, as a proprietorship concern, and subsequently the constitution changed to a private limited company in 1997. The company is promoted by Mr. C. Krishnamoorthy. The promoters have more than two decades of experience in the automobile ancillary business and are well supported by a second line of management comprising Mr. Gopinath Krishnamoorthy and Mrs. Krishnamoorthy Kavitha. The promoter’s extensive experience has helped the company to establish a healthy relationship with the reputed customers and suppliers. FCTPL’s major customers include companies like Toyota Boshoku Automotive India Private Limited, Autoliv Safety System India Private Limited, Tokai Rubber Auto Parts India Private Limited, Maruti Suzuki India Limited, and Denso Kirloskar India Private Limited, etc. Acuité believes having a stable clientele will provide strong revenue visibility in the short to medium term. Steady scale of operations The company continues to demonstrate a steady scale of operations, recording a year on year revenue growth of 4.52 percent in FY2025, with operating income increasing to Rs. 556.31 Cr. from Rs. 532.23 Cr. in FY2024, supported by sustained demand from the automotive sector. In the current fiscal (FY2026), the company has already achieved Rs. 461.74 Cr. in revenues till December 2025 and is expected to achieve ~Rs. 620 Cr. for FY2026. Profitability moderated during FY2025, with the EBITDA margin declined to 12.47 percent from 14.67 percent in FY2024, primarily due to higher job work expenses and increased labour costs. Similarly, the PAT margin reduced to 6.42 percent in FY2025 from 9.38 percent in FY2024, the latter being elevated due to a one time exceptional gain of Rs. 10 Cr. on the sale of land. The margins are expected to improve marginally in FY2026, supported by operational efficiencies and a stable demand environment. Further, raw material cost escalations continue to be passed on to customers through periodic price revisions, while long standing vendor relationships enable the company to secure favourable steel procurement terms, helping partly offset input cost pressures. Acuité believes the recent capacity expansion at Unit 6 near Kanchipuram, now operational, is also expected to aid volume growth and support incremental improvement in operating margins going forward. Healthy financial risk profile The company’s financial risk profile remains healthy, supported by a healthy capital structure, low gearing and strong debt protection metrics. The tangible net worth improved to Rs. 202.79 Cr. as on March 31, 2025, from Rs. 167.01 Cr. as on March 31, 2024, driven by healthy internal accruals and accretion to reserves. Gearing (debt to equity) of the company stood at 0.09 times as on March 31, 2025, against 0.11 times as on March 31, 2024. The total debt of the company stood low at Rs.19.09 Cr as on March 31, 2025, as compared to Rs.18.06 Cr. as on March 31, 2024. Debt protection indicators continue to remain strong, with the interest coverage ratio (ICR) of 11.40 times and Debt service coverage ratio (DSCR) to 4.04 times in FY2025 as compared to 13.95 times and 5.06 times respectively in FY2024. Further, TOL/TNW stood at 0.56 times in FY2025 from 0.57 times in FY2024, reflecting a comfortable leverage position. The company’s Debt/EBITDA stood at 0.27 times in FY2025 from 0.20 times in the previous year, driven by healthy profitability and low debt levels. The company established Unit–6 near Kanchipuram at a project cost of Rs. 30 Cr., initially funded through internal accruals and later refinanced by a through term loan. The unit commenced commercial production in April 2025. In FY26, the company availed a Rs. 50 Cr. term loan from the Bank, to reimburse Unit–6 project cost to an extent, while the balance supported machinery capex across other units. Acuité believes that, going forward, the company’s financial risk profile is expected to moderate due to the term loan availed for the recently completed capex. However, the financial risk profile is expected to remain healthy, supported by adequate net cash accruals arising from the benefits of the capex. Efficient working capital operations FCTPL’s working capital operations remained efficient marked by efficient gross current Asset (GCA) at 63 days in FY2025 as against 62 days in FY2024. The GCA days are efficient on account of efficiently managing the receivable cycle and inventory days. Inventory days stood similar 7 days in and FY2024. Debtor days stood at 36 days in FY20245 as against 37 days in FY2024. Further, the average bank limit utilization for the fund-based limits stood at 30.7 percent for the last six months ended February 2025. Subsequently, the payable period stood at 57 days in FY2025 as against 46 days in FY2024 respectively. Acuité believes that the efficient working capital management will be crucial to the FCTPL in order to maintain a stable credit profile. |
| Weaknesses |
| Competitive nature of auto ancillary business and its susceptibility to cyclicality to automotive industry
FCTPL is present in the highly competitive auto ancillary business, which has a large number of small and large players who have a varied appetite for technology. The majority of the high margin and technology-intensive works are picked up by larger players who can set aside funds for research and development. The less technologically intensive and production activities are passed on to smaller players in the market. The automobile industry is highly cyclical, with demand moving with larger economic cycles, customer preferences, government policies, etc. FCTPL has a limited bargaining power with its customers and faces customer concentration risk, as more than 62 percent of the revenue is derived from four top customers. We believe that FCTPL will continue to remain exposed to the volatility in demand for the products and dependency on OEMs. |
Rating Sensitivities
| Potential triggers (individual or collective) for an upward rating action: |
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| Potential triggers (individual or collective) for a downward rating action: |
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| Liquidity Position |
| Strong |
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FCTPL liquidity is Strong, marked by strong net cash accruals to its maturing debt obligation. The company has generated cash accruals of Rs. 51.18 Cr in FY2025, while its maturing debt obligations were Rs. 7.90 Cr during the same period. Going forward the company is expected to generate net cash accruals of Rs. 55- 65 Cr. in FY 2026-27 against Rs.8-15 Cr debt obligations. The current ratio stood at 1.46 times as on March 31, 2025. Further, the average bank limit utilization for the fund-based limits stood at 30.7 percent for the last six months ended February 2025. The company maintains unencumbered cash and bank balances of Rs. 7.17 Cr as on March 31, 2025. Acuité believes that the liquidity of the company is likely to improve over the medium term.
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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. | 556.31 | 532.23 |
| PAT | Rs. Cr. | 35.70 | 49.93 |
| PAT Margin | (%) | 6.42 | 9.38 |
| Total Debt/Tangible Net Worth | Times | 0.09 | 0.11 |
| PBDIT/Interest | Times | 11.40 | 13.95 |
| Status of non-cooperation with previous CRA (if applicable) |
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Not Applicable
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| Any other information |
| None |
| 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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