Product Quantum (Rs. Cr) Long Term Rating Short Term Rating
Non Convertible Debentures (NCD) 29.00 ACUITE BB+ | Stable | Assigned -
Total Outstanding 29.00 - -
 
Rating Rationale

­Acuité has assigned its long term rating of ‘ACUITE BB+’ (read as ACUITE Double B plus) on the Rs.29.00 Cr. Non-Convertible Debentures of Ecobox Industrials Asset II Private Limited (EIAPL - II).  The outlook is 'Stable'.

Rationale for RatingT
The rating assigned factors in EIAPL - II's strong parent support from Rava Partners which is a Singapore based fund house. Rava Partners has committed more than USD $2 billion to real assets businesses spanning the warehousing, logistics, and supply chain sectors. Ecobox group of entities is one such warehousing venture of Rava Partners. However, execution risk of proposed acquisition constrains the rating. Ecobox group of entities is in the process of acquiring 3 operational industrial warehousing assets, housed under 4 different existing SPVs, from a seller. The proposed acquisition is currently at nascent stage with high funding and execution risk. Going forward, timely completion of the proposed acquisition without cost overruns will be a key rating monitorable.

About the Company
Ecobox Industrials Asset II Private Limited (EIAPL II) incorporated in August, 2024, is a new investment venture of Rava Partners. A special purpose vehicle formed for the purpose of acquiring a warehousing asset at Sricity, Andhra Pradesh. The company is currently managed by Mr. Abhay Goyal and Mr. Ashish Shah.

 
 
Unsupported Rating
­Not Applicable.
 
Analytical Approach
­Acuité has considered the standalone business and financial risk profiles of Ecobox Industrials Asset II Private Limited to arrive at this rating.
 
Key Rating Drivers

Strengths
­Strong Parentage
EIAPL – II is a part of Ecobox group of entities, which is promoted by Singapore based fund house Rava Partners. Rava Partners builds real asset platforms in growth sectors of Asia’s economy such as education, logistics / industrial, life sciences / healthcare, digital infrastructure and other specialized asset classes. Since launching its real assets business, Rava Partners has committed more than USD $2 billion to real assets businesses spanning the warehousing, logistics, and supply chain sectors. Rava Partners was established by Hillhouse Investment together with senior management of Rava. Hillhouse Investment (“Hillhouse”) is a global alternative investment manager with a range of investment strategies that span public equities, private equity (across buyout, venture capital and growth strategies), private credit and real assets. The firm manages capital for global institutions, including non-profit foundations, endowments, and pensions. Based in Singapore, the global investment firm has an international team working in offices in Mumbai, London, New York, Sydney, Hong Kong, Beijing, Shanghai, and Amsterdam. Ecobox group is in the process of acquiring 3 operational industrial warehousing assets, housed under 4 different existing SPVs, from a seller. The total asset size is ~2.6 mn sq ft. The existing SPVs will be acquired by way of a share purchase agreement. For this, the parent group has created 4 new SPVs which will buy the shareholding of these existing SPVs from the seller. EIAPL-II is one of the entities of this transaction, which will acquire 100 percent shareholding in one of the seller entitiy from its existing promoters. The warehousing asset is located at Sricity, Andhra Pradesh.  

Adequacy of operational cashflow from warehouses to be acquired
Ecobox group is in the process of acquiring 3 operational industrial warehousing assets, housed under 4 different existing SPVs, from a seller. The 3 warehouses at a consolidated level are estimated to generate DSCR in the range of 1.24 – 1.33 times. EIAPL – II will be acquiring 100% stake in one of the seller entites which owns the warehousing asset is located at Sricity, Andhra Pradesh. At a standalone level, the DSCR from the asset is estimated to be in the range of 1.31-1.37 times.  

Weaknesses
­Exceution Risk:
The proposed transaction i.e.purchase of warehousing asset by EIAPL – II vide share purchase in seller entity is currently under process with infusion of both debt and equity funding pending. The acquisition is estimated to cost around ~Rs. 179.20 Cr. which is to be funded by equity or compulsorily convertible debentures to the tune of Rs. 117.50 Cr. and balance vide issue of listed non-convertible debentures. Acuite believes the proposed acquisition is currently at nascent stage with high funding and execution risk. Timely completion of the proposed acquisition without cost overruns will be a key rating monitorable.
Rating Sensitivities
Timely completion of proposed acquisition without cost overruns. 
Retained occupancy of warehouses that are to be acquired.
 
 
Liquidity Position
Adequate
The liquidity position is marked adequate basis the strong parentage of EIAPL-II and expected support from them in case of any exigencies. Further, post completion of proposed acquisition liquidity is estimated to remain adequate marked by sufficient net cash accruals against repayment obligations. 
 
Outlook: Stable
The Outlook is ‘Stable’ driven by strong parentage of the company. The outlook may be revised to 'Positive' in case of timely completion of proposed acquisition without any cost overruns. The outlook may be revised to 'Negative' in case of delay in proposed debt or equity funding in the company which would delay the proposed acquisition.
 
Other Factors affecting Rating
­None.
 
Key Financials :
The company is incorporated on August 02, 2024, financial statements for the year are not available.
 
Status of non-cooperation with previous CRA (if applicable)
­None.
 
Any other information
­None.
 
Applicable Criteria
• 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
• Real Estate Entities: https://www.acuite.in/view-rating-criteria-63.htm

Note on complexity levels of the rated instrument
­In order to inform the investors about complexity of instruments, Acuité has categorized such instruments in three levels: Simple, Complex and Highly Complex. Acuite’ s categorisation of the instruments across the three categories is based on factors like variability of the returns to the investors, uncertainty in cash flow patterns, number of counterparties and general understanding of the instrument by the market. It has to be understood that complexity is different from credit risk and even an instrument categorized as 'Simple' can carry high levels of risk. For more details, please refer Rating Criteria “Complexity Level Of Financial Instruments” on www.acuite.in
 
Rating History :
­Not Applicable.
 

Lender’s Name ISIN Facilities Date Of Issuance Coupon Rate Maturity Date Quantum
(Rs. Cr.)
Complexity Level Rating
Not Applicable Not avl. / Not appl. Proposed Non Convertible Debentures Not avl. / Not appl. Not avl. / Not appl. Not avl. / Not appl. 29.00 Simple ACUITE BB+ | Stable | Assigned

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