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| Product | Quantum (Rs. Cr) | Long Term Rating | Short Term Rating |
| Bank Loan Ratings | 10.00 | ACUITE BB+ | Reaffirmed & Withdrawn | - |
| Bank Loan Ratings | 40.00 | - | ACUITE A4+ | Reaffirmed & Withdrawn |
| Total Outstanding | 0.00 | - | - |
| Total Withdrawn | 50.00 | - | - |
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Rating Rationale |
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Acuité has reaffirmed and withdrawn the long term rating of ‘ACUITE BB+’ (read as ACUITE double B plus) and short term rating of ‘ACUITE A4+’ (read as ACUITE A four plus) on the Rs.50.00 crore bank facilities of STANDARD RETAIL PRIVATE LIMITED (SRPL).
The rating has been withdrawn on Acuite's policy of withdrawal of ratings. The rating has been withdrawn on account of the request received from the company, and the NOC received from the banker. Rationale for the reaffirmation The rating draws comfort from the experienced promoters, the company’s long track record in the industry and moderate financial risk profile. These strengths are however, offset by the working capital-intensive in nature of operations. |
| About the Company |
| Incorporated in May 2010 by Mr. Nikunj Turakhia, Standard Retail Private Limited (SRPL) a mumbai based company is engaged in trading of various types of mild steel products viz. colour-coated coils, pre-painted galvanized iron (PPGI), hot-rolled coils, cold-rolled coils, galvanized steel, and various other types of products viz. billets, slabs, plates, sheets, electrolytic tin plates, electrolytic tin sheets, wire rod coils, electro-galvanized coils & plates, etc. SRPL is the flagship company of the Standard Group (SG) which has diversified interests across various sectors viz. steel, real estate, lighting, solar, steel servicing & aluminium, etc. The products dealt with by SRPL are sold to various steel processors & millers and wholesalers in the domestic market. |
| Unsupported Rating |
| Not Applicable |
| Analytical Approach |
| Acuité has considered the standalone business and financial risk profiles of SRPL to arrive at the rating. |
| Key Rating Drivers |
| Strengths |
| Experienced management
Incorporated in May 2010 by Mr. Nikunj Turakhia, Standard Retail Private Limited (SRPL) is engaged in trading of various types of mild steel products viz. colour-coated coils, pre-painted galvanized iron (PPGI), hot-rolled coils, cold-rolled coils, galvanized steel, and various other types of products viz. billets, slabs, plates, sheets, electrolytic tin plates, electrolytic tin sheets, wire rod coils, electro-galvanized coils & plates, etc. SRPL is the flagship company of the Standard Group (SG) which has diversified interests across various sectors viz. steel, real estate, lighting, solar, steel servicing & aluminium, etc. The products dealt with by SRPL are sold to various steel processors & millers and wholesalers in the domestic market. Moderate financial risk profile The moderate financial risk profile is marked by increasing net worth, comfortable gearing and healthy debt protection metrics. The tangible net worth has increased to Rs. 103.73 Cr. as on FY2023(prov)as compared to Rs.101.18 Cr as on FY2022 due to accretion of reserves. The gearing of the company stood at 0.91 times as on FY2023(prov) as compared to 0.42 times as on FY2022. The Total outside Liabilities/Tangible Net Worth (TOL/TNW) stood low at 1.49 times as on FY2023(prov) as against 1.27 times as on FY2022. The debt protection metrics of the company marked by comfortable Interest Coverage Ratio (ICR) at 2.19 times as on FY2023(prov) as compared to 2.32 times as on FY2022 and Debt Service Coverage Ratio at 1.97 times as on FY2023( prov ) as compared to 2.32 times as on FY2022. Net Cash Accruals/Total Debt (NCA/TD) stood low at 0.04 times as on FY2023(prov). |
| Weaknesses |
| Working capital intensive nature of operations
The working capital-intensive nature of operations of the company is marked by high Gross Current Asset days (GCA) of 246 as on FY2023(prov) as compared to 131 days of FY2022 due to significantly changes in high other current asset which consists of other deposit, prepaid expenses material on loans etc. However, the debtor days stood comfortable at 93 days as on FY2023(prov) as compared to 66 days as on FY2022. The inventory period stood at 110 days as on FY2023(prov). |
| Rating Sensitivities |
| Not Applicable |
| All Covenants |
| Not Applicable |
| Liquidity Position |
| Adequate |
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The company’s liquidity position is adequate marked by net cash accruals of Rs.3.92 Cr as on FY2023(prov) as against nil. long-term debt repayment during the same period. The current ratio stood at 1.74 times as on FY2023(prov), as compared to 2.09 times as on FY2022. The cash and bank balances stood at Rs. 0.02 Cr. FY2023(prov). However, the working capital-intensive nature of operations of the company is marked by Gross Current Assets (GCA) of 246 days as on FY2023(prov) as compared to 131 days as on FY2022, due to high other current asset.
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| Outlook: Not Applicable |
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| Other Factors affecting Rating |
| None |
| Particulars | Unit | FY 23 (Provisional) | FY 22 (Actual) |
| Operating Income | Rs. Cr. | 315.66 | 535.54 |
| PAT | Rs. Cr. | 2.49 | 5.20 |
| PAT Margin | (%) | 0.79 | 0.97 |
| Total Debt/Tangible Net Worth | Times | 0.91 | 0.42 |
| PBDIT/Interest | Times | 2.19 | 2.32 |
| Status of non-cooperation with previous CRA (if applicable) |
| Not Applicable |
| Any other information |
| None |
| Applicable Criteria |
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• Default Recognition :- https://www.acuite.in/view-rating-criteria-52.htm • Trading Entitie: https://www.acuite.in/view-rating-criteria-61.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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