Press Release March 24, 2025 SEUTIC PHARMA PRIVATE LIMITED Rating Assigned and Downgraded

Product	Quantum (Rs. Cr)	Long Term Rating	Short Term Rating
Bank Loan Ratings	1.20	ACUITE C | Assigned	-
Bank Loan Ratings	11.88	ACUITE D | Assigned	-
Bank Loan Ratings	4.00	ACUITE D | Downgraded	-
Bank Loan Ratings	10.00	-	ACUITE D | Downgraded
Total Outstanding	27.08	-	-
Total Withdrawn	0.00	-	-

Rating Rationale

Acuite has downgraded the long term rating from ‘ACUITE B’ (read as ACUITE B) to ‘ACUITE D’ (read as ACUITE D) and the short term rating from ‘ACUITE A4’ (read as ACUITE A four) to ‘ACUITE D’ (read as ACUITE D) on the Rs. 14 Cr. bank facility of Seutic Pharma Private Limited. Acuite has assigned the long term rating to ‘ACUITE C’ (read as ACUITE C) on the Rs.1.20 Cr. bank facility of Seutic Pharma Private Limited. Acuite has assigned the long term rating to ‘ACUITE D’ (read as ACUITE D) on the Rs.11.88 Cr. bank facility of Seutic Pharma Private Limited. Rationale for Downgrade As per the lender’s feedback, there has been delays of four to five days in servicing of interest and instalments on term loan as well as cash credit account by the group (Seutic Labs Private Limited & Seutic Pharma Private Limited) in February, 2025. in February, 2025.

About the Company

­Seutic Pharma Private Limited was Established in The Year 2014 at Jeedimetla, Hyderabad, Telangana, India. The Present Directors Of The Company are Mr.Venkata Siva Vara Prasad Valivarthi, Mrs.Padma Valivarthi. It is engaged in manufacturing bulk drug Intermediaries.

About the Group

­Seutic Labs Private Limited Seutic Labs Private Limited Is Established in The Year 2016 At Kukatpally, Hyderabad, Telangana, India. The Present Directors Of The Company are Mr.Venkata Siva Vara Prasad Valivarthi, Mrs.Padma Valivarthi. It is engaged in manufacturing bulk drug Intermediaries.

Unsupported Rating

­Not Applicable

Analytical Approach

Extent of Consolidation

•Full Consolidation

Rationale for Consolidation or Parent / Group / Govt. Support

­Acuité has consolidated the business and financial risk profiles of Seutic Labs Private Limited and Seutic Pharma Private Limited (referred to as Seutic Group). The consolidation is in view of the common ownership, and similar line of business.

Key Rating Drivers

Strengths

­Established relationships with large pharmaceutical likely to support future business prospects The group has been engaged in manufacturing and marketing APIs and advanced intermediates. SPPL is a supplier to various pharmaceutical companies in India. The group’s customer base comprises many reputed players in the pharmaceutical industry, including Glenmark Life Sciences Limited. The promoters' experience of over a decade in the bulk drug manufacturing business have helped the group to established healthy relationships with its customer and is expected to continue receives benefits from the promoters over the medium term as well. Steady business risk profile The revenue from operations of the group stood at Rs.189.42 crore in FY2024 as compared to Rs.191.55 crore in FY2023 and Rs.185.34 crore in FY2022. The EBITDA and PAT margin of the group stood at 7.31% and 0.81% respectively in FY2024 as against 5.73% and 0.80% respectively in FY2023. Further, the group has unexecuted order book of Rs.41.73 Cr. as on 17 th February, 2025.

Weaknesses

­Intensive Working capital operations The working capital operations of the group are intensive marked by GCA days of 216 days as on 31st March 2024 as compared to 185 days as on 31 st March 2023. Further, the debtor days stood at 73 days as on 31st March 2024 as compared to 55 days in the previous year. On the other hand, the creditor days stood at 111 days as on 31st March 2024 as compared to 86 days as 31st March 2023. The inventory days of the group stood at 146 days as on 31st March 2024 as compared to 128 days as on 31st March 2023. Further, working capital limits stood at an average of 90.90% for the last six months ended February 2025. Average Financial Risk Profile The financial risk profile of the group is marked by net worth of Rs.17.18 Crore in FY24 and Rs.15.64 Cr. in FY23. The increase in the net-worth is on an account of accretion of profits into reserves. The capital structure of the group is marked by gearing ratio which stood at 3.93 times as on 31st March 2024 against 4.07 times as on 31st March 2023. Further, the coverage indicators of the group are reflected by interest coverage ratio and debt service coverage ratio which stood at 1.59 times and 1.00 times respectively as on 31st March 2024 as against 2.06 times and 1.11 times respectively as on 31st March 2023.

Rating Sensitivities

­Timely repayment of term loan obligations. Working capital cycle.

Liquidity Position

Poor

­The liquidity profile of the group is poor marked by insufficient net cash accruals which stood at Rs.4.53 Cr. in FY2024 against maturing debt obligation of Rs.4.56 Cr. in the same period. Further, as per the lender’s feedback there have been delays of four to five days in servicing of interest and instalments on term loan as well as cash credit account by the group (Seutic Labs Private Limited & Seutic Pharma Private Limited)  in the month of February, 2025.

Outlook: Not Applicable

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Other Factors affecting Rating

­None

Key Financials

Particulars	Unit	FY 24 (Actual)	FY 23 (Actual)
Operating Income	Rs. Cr.	189.42	191.55
PAT	Rs. Cr.	1.53	1.53
PAT Margin	(%)	0.81	0.80
Total Debt/Tangible Net Worth	Times	3.93	4.07
PBDIT/Interest	Times	1.59	2.06

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

­Not Applicable

Interaction with Audit Committee anytime in the last 12 months (applicable for rated-listed / proposed to be listed debt securities being reviewed by Acuite)

Not applicable

Any Other Information

­None

Applicable Criteria

• Application Of Financial Ratios And Adjustments: https://www.acuite.in/view-rating-criteria-53.htm • Consolidation Of Companies: https://www.acuite.in/view-rating-criteria-60.htm • Default Recognition: https://www.acuite.in/view-rating-criteria-52.htm • Manufacturing Entities: https://www.acuite.in/view-rating-criteria-59.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 16 Oct 2024 Bills Discounting Short Term 10.00 ACUITE A4 (Reaffirmed & Issuer not co-operating*) Cash Credit Long Term 2.00 ACUITE B (Downgraded & Issuer not co-operating* from ACUITE B+) Term Loan Long Term 2.00 ACUITE B (Downgraded & Issuer not co-operating* from ACUITE B+) 19 Jul 2023 Bills Discounting Short Term 10.00 ACUITE A4 (Reaffirmed & Issuer not co-operating*) Cash Credit Long Term 2.00 ACUITE B+ (Reaffirmed & Issuer not co-operating*) Term Loan Long Term 2.00 ACUITE B+ (Reaffirmed & Issuer not co-operating*) 26 Apr 2022 Bills Discounting Short Term 10.00 ACUITE A4 (Reaffirmed & Issuer not co-operating*) Cash Credit Long Term 2.00 ACUITE B+ (Reaffirmed & Issuer not co-operating*) Term Loan Long Term 2.00 ACUITE B+ (Reaffirmed & Issuer not co-operating*)

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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 Union Bank of India Not avl. / Not appl. Bills Discounting Not avl. / Not appl. Not avl. / Not appl. Not avl. / Not appl. 10.00 Simple ACUITE D | Downgraded ( from ACUITE A4 ) Union Bank of India Not avl. / Not appl. Cash Credit Not avl. / Not appl. Not avl. / Not appl. Not avl. / Not appl. 4.00 Simple ACUITE D | Downgraded ( from ACUITE B ) Union Bank of India Not avl. / Not appl. Cash Credit Not avl. / Not appl. Not avl. / Not appl. Not avl. / Not appl. 7.00 Simple ACUITE D | Assigned Not Applicable Not avl. / Not appl. Proposed Long Term Bank Facility Not avl. / Not appl. Not avl. / Not appl. Not avl. / Not appl. 0.05 Simple ACUITE C | Assigned Union Bank of India Not avl. / Not appl. Term Loan Not avl. / Not appl. Not avl. / Not appl. 31 Dec 2027 4.88 Simple ACUITE D | Assigned Sundaram Finance Ltd. Not avl. / Not appl. Term Loan Not avl. / Not appl. Not avl. / Not appl. 31 Oct 2026 1.15 Simple ACUITE C | Assigned

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*Annexure 2 - List of Entities (applicable for Consolidation or Parent / Group / Govt. Support)

Sr. No.  Company name 1 Seutic Labs Private Limited 2 Seutic Pharma Private Limited

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.