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| Product | Quantum (Rs. Cr) | Long Term Rating | Short Term Rating |
| Bank Loan Ratings | 5.00 | ACUITE BB | Reaffirmed & Withdrawn | - |
| Total Outstanding Quantum (Rs. Cr) | 0.00 | - | - |
| Total Withdrawn Quantum (Rs. Cr) | 5.00 | - | - |
| Rating Rationale |
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Acuité has reaffirmed and withdrawn the long-term rating of ‘ACUITE BB’ (read as ACUITE double B) on the Rs.5.00 Cr. bank facilities of Mindcraft Software Private Limited (MSPL).
The rating is being withdrawn on account of the request received from the company and the NOC received from the banker as per Acuité’s policy on withdrawal of ratings. |
| About the Company |
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Mindcraft Software Private Limited (MSPL) is Mumbai based company, incorporated in 2002 by Mr. Haresh Hirani, Mr. Hemant Nerurkar, Mr. Anuraag Gupta and Mr. Neeraj Manchanda. The company is software solutions and services organization offering integration solutions, business intelligence solutions and software infrastructure management services.
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| Analytical Approach |
| Acuité has considered the standalone business and financial risk profile of Mindcraft Software Private Limited (MSPL). |
Key Rating Drivers
| Strengths |
| >Extensive experience of promoters and their established presence in the business
The company was incorporated in 2002 by Mr. Haresh Hirani, Mr. Hemant Nerurkar, Mr. Anuraag Gupta and Mr. Neeraj Manchanda. The promoters have almost two decades of experience in managing business operations of the company and is familiar with changing trends in IT industry. Acuité believes that the company will continue to benefit from the promoters' experience and established track record of operations in improving its business risk profile over the medium term. >Reputed clientele base The long standing existence of the company has enabled in establishing reputed clientele base such as Birla Sunlife Insurance, TATA Life, Aditya Birla Mutual Funds, Ratnakar Bank Limited BNP Paribas, Cipla, HDFC Bank, ICICI Bank, ICICI Prudential Life Insurance, Kotak Bank, The Bombay Stock Exchange, Yes Bank etc. The company has total 60-65 clients, however around 60% of revenue is derived from 20 customers. >Improving Sales and profitability Mindcraft Software Private Limited (MSPL) has seen an improvement in the revenue by 10.71% growth. The revenue of the company rose to Rs.49.46 crore in FY2022(Prov.) from Rs.44.68 crore in FY2021. The EBITDA and PAT Margins of the company also improved as compared to the previous year. The EBITDA Margins of the company stood at 9.21 percent in FY2022 as against 9.00 percent in FY2021. The PAT Margins stood high at 2.74 percent in FY2022 as against 1.97 percent in FY2021. The ROCE of the company stood at 26.24 percent in FY2022 as against 18.10 percent in FY2021. >Financial risk profile-moderate The financial risk profile of the company stood moderate marked by moderate net worth, low gearing and comfortable debt protection metrics. The tangible net worth stood moderate at Rs.11.59 crore as on 31 March 2022 as against Rs.4.95 crore as on 31 March, 2021. Total debt of the company stood at Rs.2.83 crore as on 31 March 2022 as against Rs.2.17 crore as on 31 March, 2021. Total debt comprises of short term debt of Rs 1.99 crore and USL from directors of Rs 0.84 crore. Gearing (debt-equity) of the company improved to 0.24 times as on 31 March 2022 as against 0.44 times as on 31 March, 2021.Total outside Liabilities/Total Net Worth (TOL/TNW) stood moderate at 1.32 times as on 31 March 2022 as against 2.34 times as on 31 March, 2021. Net Cash Accruals to Total Debt (NCA/TD) stood at 1.20 times as on 31st March FY2022 as against 1.56 times as on 31st March 2021. Debt protection metrics of the company is marked comfortable with Interest Coverage Ratio at 10.52 times in FY2022. Debt Service Coverage Ratio (DSCR) stood at 5.13 times in FY2022. |
| Weaknesses |
| Working capital management -Intensive The working capital requirements of the company is marked intensive as the GCA stood high at 152 days as on March 31, 2022 as against 118 days as on March 31, 2021. The debtors increased to 74 days as on March 31, 2022 as against 66 days as on March 31, 2021.The Creditors day stood at 76 days as on March 31, 2022 as against 30 days as on March 31, 2020. |
| Rating Sensitivities |
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>Improving scale of operations while improving profitability. >Moderate financial risk profile >Any elongation of the working capital cycle leading to deterioration in debt protection metrics |
| Material covenants |
| None |
| Liquidity Position |
| Adequate |
| The company’s liquidity profile is adequate marked by adequate net cash accruals of Rs.3.39 Cr in FY2022 as against its maturing debt obligations of Rs.0.30 crore in the same period. The firm maintains unencumbered cash and bank balances of Rs. 0.17 crore as on March 31, 2022. The current ratio of the company stood confortable at 1.45 times as on March 31, 2022 as against 1.30 times as on March 31, 2021. |
| Outlook |
| Not Applicable |
| Other Factors affecting Rating |
| None |
| Particulars | Unit | FY 22 (Provisional) | FY 21 (Actual) |
| Operating Income | Rs. Cr. | 49.46 | 44.68 |
| PAT | Rs. Cr. | 1.36 | 0.88 |
| PAT Margin | (%) | 2.74 | 1.97 |
| Total Debt/Tangible Net Worth | Times | 0.24 | 0.44 |
| PBDIT/Interest | Times | 10.52 | 7.11 |
| 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 • 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 |
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