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| Product | Quantum (Rs. Cr) | Long Term Rating | Short Term Rating |
| Bank Loan Ratings | 28.46 | ACUITE BBB- | Reaffirmed & Withdrawn | - |
| Bank Loan Ratings | 57.00 | - | ACUITE A3 | Reaffirmed & Withdrawn |
| Bank Loan Ratings | 4.54 | - | Not Applicable | Withdrawn |
| Total Outstanding | 0.00 | - | - |
| Total Withdrawn | 90.00 | - | - |
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Rating Rationale |
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Acuité has reaffirmed and withdrawn its long-term rating of ‘ACUITE BBB-’ (read as ACUITE triple B minus) and the short-term rating of ‘ACUITE A3’ (read as ACUITE A three) on the Rs.85.46 Cr. bank facilities of Madhusudan Agrawal Project Private Limited (MAPPL). The rating is being withdrawn on account of the request received from the company, and NOC (No Objection Certificate) received from the banker.
Further, Acuité has withdrawn its short-term rating on Rs 4.54 crore proposed bank facilities of Madhusudan Agrawal Project Private Limited (MAPPL) without assigning any rating as it is a proposed facility. The rating is being withdrawn on account of the request received from the company. The withdrawal is in accordance with Acuite's policy on withdrawal of rating as applicable to the respective facility/instrument. Rationale for reaffirmation of the rating The rating reaffirmation reflects the stable business risk profile of MAPPL marked by steadily rising scale of operations and comfortable profitability margins. The company has achieved revenues of Rs.234.42 Cr. in FY2024 as compared to revenues of Rs. 159.19 Cr. in FY2023 and Rs.102.00 Cr. in FY2022. The rating further considers the experienced management and the long-standing operations of the company. These strengths are, however, partly offset by the moderate financial risk profile and the working capital-intensive nature of operations of the company. |
| About the Company |
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Incorporated in 1989, Madhusudan Agrawal Project Private Limited (MAPPL), was erstwhile a proprietorship firm and later reconstituted as a private limited company in 2020. Based in Chhattisgarh, MAPPL is headed by Mr. Madhusudan Agrawal along with the other promoters Mr. Devesh Agrawal and Mr. Dakshesh Agrawal. The company is engaged in civil construction work for roads, railway stations, buildings and related ancillary works. It undertakes construction works majorly for Indian Railways.
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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 financial and business risk profile of Madhusudan Agrawal Project Private Limited (MAPPL).
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| Key Rating Drivers |
| Strengths |
| Established track record of operations aided by experienced management
MAPPL has been in operations for more than two decades and has established healthy relationships with the clientele namely, Indian Railways, MRIDC and HPCL. The company’s growth is aided by the industry experience of Mr. Madhusudan Agrawal along with the other promoters Mr. Devesh Agrawal and Mr. Dakshesh Agrawal. Acuité believes that the long standing operations and the vintage of the promoters coupled with healthy relations with the clientele will continue to benefit the company going forward. Steady business risk profile supported by comfortable orderbook position The company has witnessed a steady rise in the scale of operations and has achieved revenues of Rs.234.42 Cr. in FY2024 as compared to revenues of Rs.159.19 Cr. in FY2023. The rise in the operating income is supported by increase in the order book size and timely execution of it. The company has an unexecuted order book position of Rs. 801.49 Cr. as on 31s t October 2024. The orders to be executed provides revenue visibility in the medium term. The operating margin stood stagnant at 7.64 percent in FY2024 as compared to 8.23 per cent in FY2023. The PAT margin also remained to 4.24 per cent in FY2024 against 4.23 per cent in FY2023. Acuite believes that, the business risk profile is likely to remain steady over the medium term supported by the comfortable revenue visibility from the order book position and the repetitive orders from the reputed clientele base. Strong Clientele base with diversified geographical presence The company has a strong and reputed clientele base namely, Indian Railways (primarily the South East Central Railway division, MRIDC and HPCL. The presence of the government clientele keeps the counterparty default risk lower. Moreover, the company has established a diversified presence with operations in Chhattisgarh, Madhya Pradesh and Maharashtra. |
| Weaknesses |
| Moderate financial risk profile
The moderate financial risk profile of the company is marked by low but improving net worth, moderate gearing and comfortable debt protection metrics. The tangible net worth of the company increased to Rs.27.53 Cr. as on March 31, 2024 from Rs.19.49 Cr. as on March 31, 2023 due to accretion of profits to the reserves. Gearing of the company stood moderate at 1.38 times as on March 31, 2024 as against 1.39 times as on March 31, 2023, whereas, Total Outside Liabilities/Tangible Net Worth (TOL/TNW) stood at a moderate level of 2.73 times as on March 31, 2024 as against 2.50 times as on March 31, 2023. The comfortable debt protection metrics is marked by Interest Coverage Ratio at 6.12 times and Debt Service Coverage Ratio at 2.10 times as on March 31, 2024. Net Cash Accruals/Total Debt (NCA/TD) stood low at 0.33 times as on March 31, 2024. Acuité believes that going forward the financial risk profile is likely to remain moderate over the medium term, in the absence of any major debt funded capex plans. Working capital intensive nature of operations The company’s intensive working capital cycle is marked by Gross Current Assets (GCA) of 138 days as on 31st March, 2024 as compared to 130 days as on 31st March, 2023. However, the inventory holding stood comfortable at 55 days as on 31st March, 2024 as compared to 47 days as on 31st March, 2023. The creditor days stood at 70 days in FY2024 as compared to 54 days in FY2023 Moreover, the debtor period stood low 2 day in 31st March 2024 which is at the similar level of 1 day as on 31st March 2023. Acuité believes that the working capital operations of the company may continue to remain around the similar levels as evident from the moderate inventory levels and the high current assets due to the nature of the business. |
| Rating Sensitivities |
| Not Applicable |
| Liquidity Position |
| Adequate |
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The company’s liquidity is adequate marked by steady net cash accruals of Rs.12.56 Cr. as on March 31, 2024 against long term debt repayment of Rs.4.39 Cr. for the same period. The fund-based bank limit utilisation is moderate at 46.63 percent for the last six months ended October 2024. The cash and bank balances of the company stood at Rs.0.14 Cr. as on March 31, 2024. The current ratio stood comfortable at 1.32 times as on March 31, 2024, as compared to 1.43 times as on March 31, 2023. However, the working capital management of the company is intensive in nature marked by Gross Current Assets (GCA) of 138 days in 31st March 2024 as compared to 130 days in 31st March 2023.
Acuité believes that, going forward, the liquidity position will continue to remain adequate backed by steady accruals. |
| Outlook: Not Applicable |
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| Other Factors affecting Rating |
| None |
| Particulars | Unit | FY 24 (Actual) | FY 23 (Actual) |
| Operating Income | Rs. Cr. | 234.42 | 159.19 |
| PAT | Rs. Cr. | 9.94 | 6.73 |
| PAT Margin | (%) | 4.24 | 4.23 |
| Total Debt/Tangible Net Worth | Times | 1.38 | 1.39 |
| PBDIT/Interest | Times | 6.12 | 5.46 |
| Status of non-cooperation with previous CRA (if applicable) |
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Not Applicable
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| Any other information |
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None
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| 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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