Press Release February 05, 2025 LABHANSHI AGRITECH PRIVATE LIMITED Rating Downgraded

Product	Quantum (Rs. Cr)	Long Term Rating	Short Term Rating
Bank Loan Ratings	21.50	ACUITE C | Downgraded	-
Bank Loan Ratings	13.50	ACUITE D | Downgraded	-
Total Outstanding	35.00	-	-
Total Withdrawn	0.00	-	-

Rating Rationale

­ACUITE has downgraded its long term rating to 'ACUITE D' (read as ACUITE D) from 'ACUITE BB-' (read as ACUITE double B minus) on the long term bank facilities of Rs.13.50 Crore of Labhanshi Agritech Private Limited (LAPL). Further, ­ACUITE has downgraded its long term rating to 'ACUITE C' (read as ACUITE C) from 'ACUITE BB-' (read as ACUITE double B minus) on the proposed long term bank facilities of Rs.21.50 Crore of Labhanshi Agritech Private Limited (LAPL). Rationale for downgrade The rating revision is on account of delays captured in debt obligation servicing in two accounts of the company as per the reporting in Credit Information Bureau (CIB) report. Further, account is categorized as SMA-0 in in January, 2025 as per that report.

About the Company

­Indore Based, Labhanshi Agritech Private Limited was incorporated in 2021. The company engaged in Manufacturing of Soya DOC and Oil with manufacturing capacity of 150000 tons’ pa (123000 tons’ pa of DOC & 27000 tons’ pa of Oil. The existing plant capacity installed in the proposed unit is around 500 tons per day. The promoters of the company are Mr. Ankush Singhal, Mr. Aayush Agrawal, Mr. Anup Singhal.

Unsupported Rating

­Not Applicable

Analytical Approach

­Acuite has considered the standalone financial and business risk profiles of Labhanshi Agritech Private Limited (LAPL) to arrive at the rating.

Key Rating Drivers

Strengths

­Experienced management The company was incorporated in FY22. The final products include DOC Soya and Soya Oil. The promoters of the company are Mr. Ankush Singhal, Mr. Aayush Aggarwal and Mr. Anup Singhal with the expertise and experience in the industry gained over the years. the long term presence in the industry will help the LAPL garner reputed clients such as Patanjali Foods Limited etc. Acuité believes that going ahead, the promoter's experience would continue to support LAPL's growth.

Weaknesses

­Delay in term loan repayment As per the reporting in CIC Report, Delays are captured in debt obligation servicing in two accounts of the company. Further,account is categorized as SMA-0 in in January, 2025 as per that report. Susceptibility to fluctuations in agro-based raw material price Operations are exposed to the inherent risks associated with the agriculture based commodity business, such as availability of raw materials, fluctuations in prices, and changes in government regulations. The prices of crude edible oil are volatile in nature hence the profitability is highly susceptible to the ability of the company to pass on the same to its customers. Further, the demand-supply of vegetable oil and is affected by change in regulations in exporting and importing countries.

Rating Sensitivities

­Timely repayment of term loan obligations.

Liquidity Position

Poor

­The liquidity profile of the company is poor on an account of delays being captured in debt obligation servicing in two accounts of the company as per the reporting in CIC Report. Further, account is categorized as SMA-0 in in January, 2025 as per that report.

Outlook: Not Applicable

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Other Factors affecting Rating

­None

Key Financials

Particulars	Unit	FY 23 (Actual)	FY 22 (Actual)
Operating Income	Rs. Cr.	144.86	5.74
PAT	Rs. Cr.	1.27	0.07
PAT Margin	(%)	0.87	1.20
Total Debt/Tangible Net Worth	Times	7.16	12.04
PBDIT/Interest	Times	3.02	160.83

Status of non-cooperation with previous CRA (if applicable)

­Not Applicable

Any other information

­None

Applicable Criteria

• 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

­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

Date Name of Instruments/Facilities Term Amount (Rs. Cr) Rating/Outlook 29 Dec 2023 Cash Credit Long Term 10.00 ACUITE BB- | Stable (Assigned) Term Loan Long Term 3.50 ACUITE BB- | Stable (Assigned) Proposed Long Term Bank Facility Long Term 21.50 ACUITE BB- | Stable (Assigned)

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Annexure - Details of instruments rated

Lender’s Name ISIN Facilities Date Of Issuance Coupon Rate Maturity Date Quantum (Rs. Cr.) Complexity Level Rating Indian Bank Not avl. / Not appl. Cash Credit Not avl. / Not appl. Not avl. / Not appl. Not avl. / Not appl. 10.00 Simple ACUITE D | Downgraded ( from ACUITE BB- ) Not Applicable Not avl. / Not appl. Proposed Long Term Bank Facility Not avl. / Not appl. Not avl. / Not appl. Not avl. / Not appl. 21.50 Simple ACUITE C | Downgraded ( from ACUITE BB- ) Indian Bank Not avl. / Not appl. Term Loan 20 Aug 2022 Not avl. / Not appl. 31 Aug 2028 3.50 Simple ACUITE D | Downgraded ( from ACUITE BB- )

Contacts

Mohit Jain Senior Vice President - Rating Operations Archita Sharma Associate Analyst - Rating Operations	Contact details exclusively for investors and lenders Mob: +91 8591310146 Email ID: analyticalsupport@acuite.in

About Acuité Ratings & Research

Acuité is a full-service Credit Rating Agency registered with the Securities & Exchange Board of India (SEBI). The company received RBI Accreditation as an External Credit Assessment Institution (ECAI) for Bank Loan Ratings under BASEL-II norms in the year 2012. Acuité has assigned ratings to various securities, debt instruments and bank facilities of entities spread across the country and across a wide cross section of industries. It has its Registered and Head Office in Kanjurmarg, Mumbai. Disclaimer: An Acuité rating does not constitute an audit of the rated entity and should not be treated as a recommendation or opinion that is intended to substitute for a financial adviser's or investor's independent assessment of whether to buy, sell or hold any security. Ratings assigned by Acuité are based on the data and information provided by the issuer and obtained from other reliable sources. Although reasonable care has been taken to ensure that the data and information is true, Acuité, in particular, makes no representation or warranty, expressed or implied with respect to the adequacy, accuracy or completeness of the information relied upon. Acuité is not responsible for any errors or omissions and especially states that it has no financial liability whatsoever for any direct, indirect or consequential loss of any kind, arising from the use of its ratings. Ratings assigned by Acuité are subject to a process of surveillance which may lead to a revision in ratings as and when the circumstances so warrant. Please visit our website (www.acuite.in) for the latest information on any instrument rated by Acuité. Please visit https://www.acuite.in/faqs.htm to refer FAQs on Credit Rating. Note: None of the Directors on the Board of Acuité Ratings & Research Limited are members of any rating committee and therefore do not participate in discussions regarding the rating of any entity.