Acuite has considered the consolidated approach of the business and financial risk profiles of ATPL and its subsidiaries ATSPL, Sienna and Sienna ECAD together referred to as AG due to operational & financial synergies and common management.

­Established track record of operations and experienced management
AG was established in 1995 by Mr. Kunhamed Bicha and Mr. Bhaskar Srinivasan in the US, whereas it commenced its operations in India in 1998. The day-to-day operations are managed by the senior management team led by Mr. Kunhamed Bicha and Mr. Bhaskar Srinivasan, who possess an experience of over 3 decades in the diversified manufacturing industry. The Group has developed long-term relationships with customers and suppliers over the years, which have helped it in procuring repeated orders.

Improvement in the operating performance
The revenue of the Group improved and stood at Rs.840.72 crore in FY2022 compared to revenue of Rs.690.47 crores in FY2021. The increase in the revenue is majorly due to the increase in the demand for the products as well as addition of new customers. The operating profit margin of the Group improved and stood at 12.29 percent in FY2022 compared against 9.47 percent in FY2021. The increase in the operating margins is due to improvement in the revenues. The PAT margin stood at 8.11 percent in FY2022 against 3.34 percent in FY2021.

Moderate financial risk profile
The Group has a moderate financial risk profile marked by tangible net worth of Rs.86.56 crore as on 31 March 2022 as against Rs.27.39 crore on 31 March 2021. The increase in networth is due to accretion of profits in reserves. The gearing level of the Group stood at 3.59 times as on 31 March 2022 as against 11.35 times as on 31 March 2021. The total debt of the group comprised of long term debt of Rs.44.81 crores, unsecured loans of Rs.46.38 crores and short term debt of Rs.207.18 crore as on 31 March 2022. The group has added covid loans in FY2022. The coverage ratios of the group remained moderate with Interest Coverage Ratio (ICR) of 5.17 times for FY2022 as against 2.65 times for FY2021. The Debt Service Coverage Ratio (DSCR) stood at 3.23 times for FY22 as against 2.07 times for FY21. The total outside liabilities to tangible net worth (TOL/TNW) of the company stood at 5.60 times as on 31 March 2022 as against 16.83 times as on 31 March 2021.

Working capital intensive nature of operations
The Group’s operations are working capital intensive as evident from Gross Current Asset (GCA) of 194 days as on March 31, 2022, as against 200 days as on March 31,2021. The inventory days stood at 115 days for FY2022 compared against 85 days for FY2021. The inventory is high in FY2022 because there was shortage of components, and the Group was hence required to stock up the required materials for making the products. The Group normally stocks up inventory on the basis of the orders received. The average inventory days are around 90-100 days. The debtor days improved and stood at 77 days for FY2022 as against 96 days for FY2021. Average credit period allowed is around 60 days. The creditor days of the group stood at 81 days for FY2022 as against 102 days for FY2021. The average credit period received is around 60 days.