­Acuité has revised the approach and excluded Asansol Polyfabs Pvt Ltd as the company has already been merged with Shri Maa Polyfabs Limited with effect from 1st April 2021. Hence, Acuité has considered the consolidated financial and business risk profile of Shri Maa Polyfabs Limited (SMPL), Hariom Polypacks Private Limited (HPPL), Shri Dakshineswari Maa Polyfabs Limited (SDMPL) and Manhar Polymers Private Limited (MPPL). The same is on account of common management, same line of operations and significant operational and financial linkages. The group is herein being referred to as Shri Maa Group.

­Experienced management and established track record of operations
Shri Maa group was established in the year 2002 by Mr. Sajjan Bansal and Mr. Rajesh Kumar Sharma. The promoters of the group have more than two decades of experience in the plastic and packaging industry. The extensive experience of the management has helped the group establish long-term relations with suppliers resulting in direct procurement of polypropylene from Haldia Petrochemical Limited (HPCL), Reliance Industries Limited (RIL), and Indian Oil Corporation Limited (IOCL) among others. Moreover, their experience has also helped in building healthy customer relations with reputed customers such as Birla Corporation Limited, ACC Limited, Ultratech Cement Limited, JSW Cement Limited, and Shree Cement Limited among others in the eastern part of the country. Acuité believes that the group will continue to benefit from long experience of the management in establishing relations with their key suppliers and customers.

Increasing scale of operation coupled with healthy profitability margin
The revenue of the group stood at Rs.648.90 crore in FY2022 as compared to Rs.484.73 crore during the previous year. This significant increase in the revenue of the group during FY2022 is on account of increase in overall realization along with increase in unit sold during the period. The group has earned Rs.482.98 crore till 31st December 2022 (Provisional). Going forward, Acuité believes that the group will continue its current pace of growth backed by increasing demand of PP bags in the domestic market. Though the operating margin of the group has declined to 13.66 per cent in FY2022 as compared to 16.89 per cent in the previous year. This decrease in profitability margin is on account of increase in raw material price during the period. Further, the group has also reported an operating profit margin of 14.46 per cent till 9MFY2023 (Prov.). The net profitability margin of the group has also declined to 3.60 per cent in FY2022 as compared to 5.15 per cent in FY2021. Acuité believes the profitability margin of the group will be sustained at current levels over the medium term on account of well-established position in the eastern market along with steady demand for PP bags mainly form the cement industries.

Healthy financial risk profile
The financial risk profile of the group is marked by healthy net worth, moderate gearing and strong debt protection metrics. The net worth of the group stood healthy at Rs.200.43 crore in FY 2022 as compared to Rs 161.36 crore in FY2021. This improvement in networth is mainly due to the retention of current year profit. Acuité has also considered unsecured loan of Rs.10.02 crore as a part of networth, as the same amount is subordinated with bank debt. The gearing of the group has increased and stood moderate at 1.36 times as on March 31, 2022 when compared to 1.20 times as on March 31, 2021. This increase in overall gearing is on account of increase in long term debt during the period. Interest coverage ratio (ICR) is strong and stood at 4.07 times in FY2022 as against 4.16 times in FY 2021. The debt service coverage ratio (DSCR) of the group also stood comfortable at 1.94 times in FY2022 as compared to 2.77 times in the previous year. The net cash accruals to total debt (NCA/TD) stood healthy at 0.22 times in FY2022 as compared to 0.31 times in the previous year. Going forward, Acuité believes the financial risk profile of the group will remain healthy on account of healthy net cash accruals over the near term and absence of any major capex plan over the near future.