Note:- For activities or ratings of instruments falling under the purview of Financial Sector Regulators other than SEBI, the grievance / dispute redressal mechanisms and investor protection mechanisms provided by SEBI shall not be available.
Rating Rationale
Acuité has reaffirmed and withdrawn its long-term rating of 'ACUITE BB+'(read as ACUITE double B plus) on Rs. 33.45 Cr. bank facilities of S D Bansal Iron and Steel Private Limited (SDBISPL). The rating is being withdrawn on account of the request received from the issuer and No Objection Certificate (NOC) received from the banker. Also, Acuité has withdrawn its long-term rating on Rs. 1.55 Cr. bank facilities of S D Bansal Iron and Steel Private Limited (SDBISPL) without assigning any rating as it is a proposed facility. The rating is being withdrawn on account of the request received from the issuer.
The rating has been withdrawn as per Acuite's policy of withdrawal of ratings as applicable to the respective instrument/facility.
Rationale for rating
The rating takes into account the modest scale of operations, working capital intensive nature of operations marked by high utilisation of the fund-based limits and exposure to inherent cyclicality in the steel industry. However, the rating considers moderate financial risk profile marked by below unity gearing (debt/equity) and comfortable debt protection metrics. Further, the rating reflects demonstrated track record of operations with strong parentage of Bansal Group and extensive experience of the promoters of around two decades in the iron and steel industry.
About the Company
Incorporated in 2006, S D Bansal Iron and Steel Private Limited (SDBISPL) is engaged in the manufacturing of MS billets and TMT steel bars with an installed capacity of 80,000 MTPA. The company is based in Bhopal, Madhya Pradesh and has its manufacturing facility at Raisen district of Madhya Pradesh. Additionally, the company is also engaged into electronic media business and runs a news channel named ‘Bansal News’. The current directors of the company are Mr. Sunil Bansal and Mr. Kartik Bansal.
Unsupported Rating
Not Applicable
Analytical Approach
Acuité has considered the standalone business and financial risk profiles of the SDBISPL to arrive at this rating.
Key Rating Drivers
Strengths
Strong parentage and experienced management The management of SDBISPL have an extensive experience of more than two decades in the iron and steel industry, through their association with other group companies of ‘Bansal Group’. The group has established its own brand ‘Bansal TMT Sariya’ which has a strong regional market recall for TMT bars. The promoters of the Bansal Group, Mr. Anil Bansal and Mr. Sunil Bansal started the road, and civil construction works three decades ago and gradually forayed into other sectors like mining, manufacturing, education, healthcare, amongst others.
Moderate financial risk profile
The company’s financial risk profile is moderate marked by moderate tangible net worth of Rs. 52.90 Cr. as on March 31, 2025 (Rs. 51.78 Cr. as on March 31, 2024), improved owing to accretion of profits to reserves. Moreover, the total debt of the company stood at Rs. 43.82 Cr. as on March 31, 2025 (Rs. 44.70 Cr. as on March 31, 2024) and hence, the gearing ratio (debt/equity) stood comfortable at 0.83 times as on March 31, 2025. Further, the debt protection metrics stood comfortable with interest coverage ratio of 2.63 times in FY25 (3.15 times in FY24) and debt service coverage ratio of 2.03 times in FY25 (2.27 times in FY24).
Weaknesses
Modest scale of operations The revenue of the company declined to Rs. 133.61 Cr. in FY25 as compared to Rs. 203.54 Cr. in FY24 on account of subdued demand from end-user segments leading to lower capacity utilisations. Further, the revenue is estimated to have remained stable at ~Rs. 135.09 Cr. in FY26 (Est.). However, despite the significant moderation in the top line, the operating margin has improved to 6.31 percent in FY25 (5.47 percent in FY24) on account of reduced input costs. The company clocked ~86 percent of its revenue in FY26 from manufacturing segment while the remaining from the electronics media segment.
Intensive working capital operations
The company’s working capital profile stood intensive, marked by gross current assets (GCA) increasing to 260 days in FY25 from 177 days in FY24, largely driven by higher receivables. The company-maintained inventory levels of 29 days in FY25 (17 days in FY24). Further, the debtor levels stood high at 207 days in FY25 (132 days in FY24). Moreover, the company receives credit period of almost 60-75 days from their suppliers, resulting in creditor days of 62 days in FY25.
Inherent cyclical nature of the steel industry The company's performance remains vulnerable to cyclicality in the steel sector given the close linkage between the demand for steel products, domestic and global economy. The end-user segments such as real estate, civil construction and engineering also display cyclicality. Further, operating margins are also vulnerable to volatility in the input prices (sponge iron, iron ore and coal) as well as realisation from finished goods. The prices and supply of the main raw material, sponge iron, directly impacts the realisations of finished goods.
Rating Sensitivities
Potential triggers (individual or collective) for an upward rating action:
Not Applicable
Potential triggers (individual or collective) for a downward rating action:
Not Applicable
Liquidity Position
Adequate
The liquidity position of the company is adequate marked by sufficient net cash accruals of Rs. 4.71 Cr. in FY25 as against maturing debt obligations of Rs. 0.59 Cr. However, the fund-based limit utilisation stood high at 98.80 percent for the past six months ending March 2026. Further, the company had unencumbered cash and bank balances of Rs. 2.13 Cr. as on March 31, 2025, and the current ratio stood moderate at 1.58 times as on March 31, 2025.
Outlook: Not Applicable
Other Factors affecting Rating
None
Particulars
Unit
FY 25 (Actual)
FY 24 (Actual)
Operating Income
Rs. Cr.
133.61
203.54
PAT
Rs. Cr.
1.13
3.33
PAT Margin
(%)
0.84
1.64
Total Debt/Tangible Net Worth
Times
0.83
0.86
PBDIT/Interest
Times
2.63
3.15
Status of non-cooperation with previous CRA (if applicable)
ACUITE BB+ | Stable
(Downgraded from ACUITE BBB- | Stable)
Cash Credit
Long Term
32.00
ACUITE BB+ | Stable
(Downgraded from ACUITE BBB- | Stable)
Term Loan
Long Term
0.56
ACUITE BB+ | Stable
(Downgraded from ACUITE BBB- | Stable)
Proposed Long Term Bank Facility
Long Term
1.55
ACUITE BB+ | Stable
(Downgraded from ACUITE BBB- | Stable)
26 Dec 2023
Cash Credit
Long Term
32.00
ACUITE BBB- | Stable
(Reaffirmed)
Working Capital Term Loan
Long Term
1.67
ACUITE BBB- | Stable
(Reaffirmed)
Working Capital Term Loan
Long Term
1.12
ACUITE BBB- | Stable
(Reaffirmed)
Proposed Long Term Bank Facility
Long Term
0.21
ACUITE BBB- | Stable
(Reaffirmed)
Lender’s Name
ISIN
Facilities
Listing Status
Regulated By
Date Of Issuance
Coupon Rate
Maturity Date
Quantum (Rs. Cr.)
Complexity Level
Rating
State Bank of India
Not avl. / Not appl.
Cash Credit
Unlisted
RBI
Not avl. / Not appl.
Not avl. / Not appl.
Not avl. / Not appl.
32.00
Simple
ACUITE BB+ | Reaffirmed & Withdrawn
Not Applicable
Not avl. / Not appl.
Proposed Long Term Bank Facility
Unlisted
RBI
Not avl. / Not appl.
Not avl. / Not appl.
Not avl. / Not appl.
1.55
Simple
ACUITE Not Applicable | Withdrawn
State Bank of India
Not avl. / Not appl.
Term Loan
Unlisted
RBI
21 May 2024
Not avl. / Not appl.
29 Feb 2028
0.89
Simple
ACUITE BB+ | Reaffirmed & Withdrawn
State Bank of India
Not avl. / Not appl.
Term Loan
Unlisted
RBI
21 May 2024
Not avl. / Not appl.
31 Oct 2024
0.56
Simple
ACUITE BB+ | Reaffirmed & Withdrawn
Note:- For activities or ratings of instruments falling under the purview of Financial Sector Regulators other than SEBI, the grievance / dispute redressal mechanisms and investor protection mechanisms provided by SEBI shall not be available.
Contacts
List of instruments and names of regulators of the instruments
