Press Release February 10, 2025 SUYASH CHEMICAL AND FERTILIZER PRIVATE LIMITED Rating Reaffirmed

Product	Quantum (Rs. Cr)	Long Term Rating	Short Term Rating
Bank Loan Ratings	35.34	ACUITE BB+ | Stable | Reaffirmed	-
Bank Loan Ratings	23.84	-	ACUITE A4+ | Reaffirmed
Total Outstanding	59.18	-	-
Total Withdrawn	0.00	-	-

Rating Rationale

­ACUITE has reaffirmed its 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.59.18 Crore bank facilities of  Suyash Chemical and Fertilizer Private Limited (SCFPL). The outlook is 'Stable'. Rationale for rating The rating reaffirmation reflects that the Company has a stable business risk profile marked by marginal decline in scale of operations due to dip in realisation in paper products; although there is a slight improvement in capacity utilisation in past 2 years. The operating margin declined marginally from 4.51% in FY23 to 3.97% in FY24 due to the same. The company has a moderate financial risk profile marked by net-worth of Rs.49.46 Crore as on 31st March 2024 against Rs.47.99 Crore as on 31st March 2023.. However the rating remains constrained on account of increase in working capital operations and susceptibility in profitability due to volatility in raw material prices.

About the Company

Uttar Pradesh based; Suyash Chemical and Fertilizer Private Limited (SCFPL) was incorporated in 1994 as a private limited company. SCFPL The company has two business divisions i.e., paper business (75% of its revenues) wherein it manufactures mainly kraft papers and tissue paper at its facility in Basti; and balance from agri business, producing wheat and related products such as flour, maida, suji etc. at Gorakhpur (U.P.). Directors of Suyash Chemical and Fertilizer Private Limited are Mr. Ramji Jaiswal, Mr. Manish Jaiswal, Mrs. Shakuntala Jaiswal, Mr. Sarla Jaiswal and Mr. Suyash Jaiswal.

Unsupported Rating

­­Not Applicable

Analytical Approach

­ACUITE has considered the standalone view on the business and financial risk profile  of Suyash Chemical And Fertilizer Private Limited to arrive at this rating.

Key Rating Drivers

Strengths

­Established track record of operations and experienced management Incorporated in 2008, SCFPL is promoted by Mr. Ramji Jaiswal, Mr. Manish Jaiswal, Mrs. Shakuntala Jaiswal, Mr. Sarla Jaiswal and Mr. Suyash Jaiswal who have an experience of more than three decades in the aforementioned industry. The extensive experience of the promoters, their active participation and in-depth understanding of the industry, has helped SCFPL in developing long-term relationships with its customers and suppliers. The company is operating in two business segments- i.e. paper and agro products. Acuite believes that extensive experience of the promoters will help company to maintain their business risk profile over the medium term. Revenue and Profitability The company has reported revenue of Rs. 181.57 Crores in FY24 against Rs. 208.47 Crores in FY23. The EBITDA Margins of the company stood at 3.97% in FY24 against 4.51% in FY23 and the PAT Margins of the company stood at 0.81% in FY24 against 1.40% in FY23. This dip in top line and EBITDA of the company is because decrease in the realisation in paper division. In addition, the volume sales stood at 51379 MT in paper div. and 17319.8 MT in agro div. in FY2024 from 47044 MT in paper div. and 18772 MT in agro div. in FY2023. Also company has also achieved the revenue of Rs. 150.42 Cr. in 8MFY25. Acuite believes that company is expected to report increase in scale of operations in near to medium term with stable operating and PAT margin. Moderate financial risk profile The financial risk profile of the company is moderate marked by net-worth of Rs.49.46 Crore as on 31st March 2024 against Rs.47.99 Crore as on 31st March 2023. The increase in the net-worth is on an account of small but steady accumulation of profits in reserves. The total debt of the company stood at Rs.56.13 Crore as on 31st March 2024 against Rs.52.20 Crore as on 31st March 2023. The debt of the company comprises Long term debt of Rs.27.09 Crore, Unsecured loans of Rs.0.78 Crore, Short term debt of Rs.24.45 Crore as on 31st March 2024. The increase in the total debt of the company is due to debt funded capex done by the company. Also, the gearing ratio of the company stood at 1.13 times as on 31st March 2024 against 1.09 times as on 31st March 2023. The interest coverage ratio and debt service coverage ratio of the company stood at 2.09 times and 1.03 times respectively as on 31st March 2024 against 2.83 times and 1.38 times respectively as on 31st March 2023. The TOL/TNW ratio of the company stood at 1.34 times as on 31st March 2024 against 1.27 times as on 31st March 2023. Acuite believes that financial risk profile of the company is likely to remain in the same range in near to medium term.

Weaknesses

­Working capital Intensive Operations The working capital operations of the company is marked by GCA days which stood at 162 days as on 31st March 2024 against 142 days as on 31st March 2023. The GCA days are higher on an account of the inventory days which stood at 69 days as on 31st March 2024 against 55 days as on 31st March 2023. Further, the debtor days of the company stood at 63 days as on 31st March 2024 against 50 days as on 31st March 2023 and the creditor days of the company stood at 15 days as on 31st March 2024 against 7 days as on 31st March 2023. Acuite believes that working capital operations of the company is likely to remain in the same range in near to medium term. Competitive and fragmented nature of industry SCFPL operates in intensively competitive industry where there is huge number of organized and unorganized players compete. The entry barriers are very low and any fluctuation in raw material price would limit the ability to pass on the price increase due to intense.

Rating Sensitivities

Movement in operational performance of the company Movement in financial risk profile Movement in working capital operation

Liquidity Position

Stretched

The liquidity position of the company is stretched. The company has generated net cash accruals of Rs.3.48 Crore as on 31st March 2024 against the debt repayment obligations of Rs.3.26 Crore in the same range. Going forward, the company is expected to generate sufficient net cash accruals of against debt repayment obligations in near to medium term. The Current ratio of the company stood at 2.47 times as on 31st March 2024 against 2.73 times as on 31st March 2023. The unencumbered cash and bank balance of the company stood at Rs.14.76 Crore as on 31st March 2024 against Rs.20.74 Crore as on 31st March 2023. The average bank limit utilization of the company stood at ~94.35% in last six months ended December 2024.

Outlook: Stable

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Other Factors affecting Rating

None

Key Financials

Particulars	Unit	FY 24 (Actual)	FY 23 (Actual)
Operating Income	Rs. Cr.	181.57	208.47
PAT	Rs. Cr.	1.46	2.92
PAT Margin	(%)	0.81	1.40
Total Debt/Tangible Net Worth	Times	1.13	1.09
PBDIT/Interest	Times	2.09	2.83

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

­Not Applicable

Any other information

­None

Applicable Criteria

• 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.

Rating History

Date Name of Instruments/Facilities Term Amount (Rs. Cr) Rating/Outlook 15 Dec 2023 Bank Guarantee (BLR) Short Term 18.30 ACUITE A4+ (Assigned) Cash Credit Long Term 23.63 ACUITE BB+ | Stable (Assigned) Cash Credit Long Term 3.21 ACUITE BB+ | Stable (Assigned) Term Loan Long Term 1.43 ACUITE BB+ | Stable (Assigned) Term Loan Long Term 6.13 ACUITE BB+ | Stable (Assigned) Covid Emergency Line. Long Term 2.73 ACUITE BB+ | Stable (Assigned) Covid Emergency Line. Long Term 3.75 ACUITE BB+ | Stable (Assigned)

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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 Punjab National Bank Not avl. / Not appl. Bank Guarantee (BLR) Not avl. / Not appl. Not avl. / Not appl. Not avl. / Not appl. 23.84 Simple ACUITE A4+ | Reaffirmed Punjab National Bank Not avl. / Not appl. Cash Credit Not avl. / Not appl. Not avl. / Not appl. Not avl. / Not appl. 23.63 Simple ACUITE BB+ | Stable | Reaffirmed Punjab National Bank Not avl. / Not appl. Cash Credit Not avl. / Not appl. Not avl. / Not appl. Not avl. / Not appl. 3.21 Simple ACUITE BB+ | Stable | Reaffirmed Punjab National Bank Not avl. / Not appl. Covid Emergency Line. Not avl. / Not appl. Not avl. / Not appl. 30 Dec 2026 2.60 Simple ACUITE BB+ | Stable | Reaffirmed Not Applicable Not avl. / Not appl. Proposed Long Term Bank Facility Not avl. / Not appl. Not avl. / Not appl. Not avl. / Not appl. 0.79 Simple ACUITE BB+ | Stable | Reaffirmed Punjab National Bank Not avl. / Not appl. Term Loan Not avl. / Not appl. Not avl. / Not appl. 09 May 2031 5.11 Simple ACUITE BB+ | Stable | Reaffirmed

Contacts

Mohit Jain Senior Vice President - Rating Operations Siddharth Garg 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.