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| Product | Quantum (Rs. Cr) | Long Term Rating | Short Term Rating |
| Bank Loan Ratings | 13.35 | ACUITE BB+ | Reaffirmed & Withdrawn | - |
| Bank Loan Ratings | 48.10 | - | ACUITE A4+ | Reaffirmed & Withdrawn |
| Total Outstanding Quantum (Rs. Cr) | 0.00 | - | - |
| Total Withdrawn Quantum (Rs. Cr) | 61.45 | - | - |
| Rating Rationale |
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Acuité has reaffirmed and withdrawn long term rating of ‘ACUITE BB+’ (read as ACUITE double B plus) and the short-term rating of ‘ACUITE A4+’ (read as ACUITE A four plus ) on the Rs.61.45 crore bank facilities of Krishna Builder. The rating withdrawal is in accordance with Acuite’s policy on withdrawal of ratings. The rating is being withdrawn on account of request received from the company and no objection certificate (NOC) received from the banker.
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| About the Company |
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Established in 1994, Krishna Builder (KB) is a Delhi-based proprietorship firm promoted by Mr. Praveen Mittal and is engaged in civil construction for government departments like National Buildings Construction Corporation Limited (NBCC), Public Works Departments (PWD) among others.
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| Analytical Approach |
| Acuité has considered the standalone business and financial risk profile of Krishna Builder to arrive at this rating. |
Key Rating Drivers
| Strengths |
| Experienced Management
KB is managed by Mr. Praveen Mittal, who has around three decades of experience in the infrastructure industry. Further having an operational track record of 26 years has helped the firm to maintain strong relations with its customers as well as with its suppliers. This has also helped to maintain moderate order book position with an unexecuted order of ~Rs.317 crore as on 30-April-2022. Acuite believes that the company will keep derving benefits from the experience of its promoter. Moderate Financial Risk Profile The financial risk profile of the company is moderate marked by moderate net worth which slightly improved from Rs.33.96 Cr in FY2021 to Rs.35.68 Cr in FY2022. The gearing ratio has moderated from 0.39 times in FY2021 to 0.54 times FY2022. The total debt of the company in FY2022 is Rs.19.25 Cr which consists of long term debt of Rs. 6.84 Cr, Unsecured loans of Rs.4.44 Cr, CPLTD of Rs. 1.11 Cr. and short term debt of Rs.6.86 Cr. The coverage indicators of the company though slightly moderated but remained comfortable as is apparent from movement of interest coverage ratio from 4.11 times in FY2021 to 3.02 in FY2022 and DSCR stood at same level at 2.42 times in FY 22 and 2.41times in FY2021. |
| Weaknesses |
| Intensive working Capital Operations
Working capital Operations of the firm are intensive marked by Gross Current Assets (GCA) of 323 days in FY2022 as against 227days in FY2021. This is primarily on account of sharp increase in other current assets of the company which comprises of Loans and advances, security deposits, Refunds, Receivable, Inventory , recoveries and claims. Current ratio stood moderate at 2.10 times as on 31 March 2022 as against 2.28 times as on 31 March 2021. |
| Rating Sensitivities |
| Not Applicable |
| Material covenants |
| None |
| Liquidity Position |
| Adequate |
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Firm has adequate liquidity profile marked by net cash accruals to its maturing debt obligations. Firm generated net cash accruals of Rs.4.03 Crores against the debt obligation of Rs 0.49 crore for the same period. Current Ratio of firm stood at 2.10 times for FY 22. The fund based bank limit utilisation is 89.50 % for last 6 months ended January 23. Further, the unencumbered cash balance of FY2022 is Rs.1.51Crores.
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| Outlook: Not Applicable |
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| Particulars | Unit | FY 22 (Actual) | FY 21 (Actual) |
| Operating Income | Rs. Cr. | 79.90 | 106.08 |
| PAT | Rs. Cr. | 3.44 | 4.02 |
| PAT Margin | (%) | 4.31 | 3.79 |
| Total Debt/Tangible Net Worth | Times | 0.54 | 0.39 |
| PBDIT/Interest | Times | 3.02 | 4.11 |
| Status of non-cooperation with previous CRA (if applicable) |
| None |
| Any other information |
| None |
| Applicable Criteria |
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• Default Recognition :- https://www.acuite.in/view-rating-criteria-52.htm • Infrastructure Sector: https://www.acuite.in/view-rating-criteria-51.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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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
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