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| Product | Quantum (Rs. Cr) | Long Term Rating | Short Term Rating |
| Bank Loan Ratings | 280.00 | ACUITE BBB | Stable | Upgraded | - |
| Bank Loan Ratings | 46.00 | - | ACUITE A3+ | Upgraded |
| Total Outstanding | 326.00 | - | - |
| Total Withdrawn | 0.00 | - | - |
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Rating Rationale |
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Acuite has upgraded its long-term rating to 'ACUITE BBB' (read as ACUITE Triple B) from 'ACUITE BBB-' (read as ACUITE Triple B minus) on the Rs. 280.00 crore bank facilities and short-term rating to 'ACUITE A3+' (read as ACUITE A three plus) from 'ACUITE A3' (read as ACUITE A three) on the Rs. 46.00 crore bank facilities of Tech AIC Dri Pellets Private Limited. The outlook is 'Stable'.
Rationale for Upgrade:The rating upgrade reflects the commencement of commercial operations in May, 2025 with fully operational plant, which is expected to drive revenue visibility and improve cash flow generation. Further, the company registered revenue of Rs. 572.52 Cr. during the 8M of FY2026. The company’s financial risk profile remains moderate, supported by a moderate capital structure. The rating is further supported by experienced management and extensive experience of the promoters in the industry over more than 2 decades and promoter’s flexibility to bring in funds into the company and the strong support of AIC group. However, the rating remains constrained by its cyclical nature of the steel industry and the susceptibility of profitability to volatility in raw material prices.
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| About the Company |
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Kolkata – Based, Tech AIC Dri Pellets Private Limited (TADPPL) was incorporated in 2020. The company has set up a manufacturing plant of iron ore pellet with an installed capacity of 1000000 MT per annum. The directors of the company are Mr. Dinesh Adukia, Mr. Vivek Adukia, Mr. Gyan Adukia and Mr. Dipankar Dutta.
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| About the Group |
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AIC Iron Industries Private Limited (AIIPL) was incorporated in December 2003. In February 2008, the company was taken over by Adukia group of West Bengal. The company is presently engaged in manufacturing sponge iron, billets, TMT steel and silico manganese ,MS Strips/pipes, grey and ductile iron castings.
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| Unsupported Rating |
| ACUITE BB+/ Stable |
| Analytical Approach |
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Acuité has taken a standalone view of the business and financial risk profile of Tech Aic Dri Pellets Private Limited (TADPPL) to arrive at the rating. While arriving at the rating of TADPPL, Acuité has taken into account a strong level of support from the AIC Group, as it has a controlling stake in TADPPL, corporate guarantee provided for the bank facilities of TADPPL and strong operational linkages.
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| Key Rating Drivers |
| Strengths |
| Long operational track record of AIC Group and experienced management
The promoters of the AIC group, the Adukia family of West Bengal, have more than two decades of experience in the iron and steel industry. The extensive experience of the promoters has helped them understand market dynamics and establish strong relationships with their customers and suppliers. The overall affairs of the AIC group are being managed by Mr. Dinesh Adukia and his brothers. The promoters are resourceful and have also supported the group companies by infusing unsecured loans as and when required to support the business operations. Acuité believes that the long track record of operations will benefit the company going forward, resulting in steady growth in the scale of operations. Commencement of operations and improved utilization of production capacity The company commenced commercial operations in May 2025. During FY2026 (the current year), the plant is expected to be fully operational. In the H1FY2026, the plant has already achieved a capacity utilization of 80.2 percent in the Iron Ore Pellets segment. The operating income of the company stood at Rs.51.62 Cr. in FY2025. Further, the Tech AIC registered revenue of Rs. 572.52 Cr. during the 8M of FY2026. Comment on profitability. Acuité believes going forward, the company’s scale is expected to improve on account of the commencement of operations and stabilization of capacities. Moderate financial risk profile metrics The company’s financial risk profile remained moderate, marked by a moderate capital structure, gearing and below average debt protection metrics. The net worth of the company stood at Rs.117.15 Cr. and Rs.82.64 Cr. as on March 31, 2025, and 2024 respectively. The net worth improved and stood positive on account of quasi equity of Rs. 101.00 Cr. (USL has been considered as quasi equity). Gearing (debt-to-equity ratio) of the company stood at 3.28 times as on March 31, 2025, against 1.89 times as on March 31, 2024. The deterioration in gearing is on account of high debt levels. Debt protection metrics – Interest coverage ratio (ICR) and debt service coverage ratio (DSCR) stood low at 0.92 times and 0.74 times as on March 31, 2025, respectively. TOL/TNW (Total outside liabilities/Total net worth) stood at 3.41 times and 2.00 times as on March 31, 2025, and 2024 respectively. The debt to EBITDA of the company stood at 20.96 times as on March 31, 2025, as against (1521.05) times as on March 31, 2024. Acuité believes the company’s financial risk profile would improve, though expected to remain moderate in the medium term on the back of stabilization of capacities leading to generation of steady net cash accruals.
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| Weaknesses |
| Working capital intensive operations
Company’s operations are intensive in terms of working capital marked by Gross Current Asset (GCA) days of 1337 days in FY2025. The high GCA days on account of initial stage of operations. In the current year, with the plant being fully operational, the Gross Current Asset (GCA) days are expected to remain in the range of 180–190 days for FY2026. Furthermore, the average utilization of fund-based bank limits over the last 12 months ended November 2025 stood at approximately 94 percent. Acuité believes that the working capital intensity is likely to improve, supported by the full commencement of operations and stabilization of business risk profile.
Susceptibility of profitability to volatility in raw material prices in an intensely competitive and cyclical steel industry The group faces strong competitive forces from both organized and unorganized participants, compounded by the cyclicality inherent in the steel industry. Moreover, the government’s emphasis on steel-intensive sectors like railways and infrastructure increases vulnerability; any prolonged drop in demand would negatively affect steel group’s performance. Furthermore, the fluctuation in prices of raw materials and goods is considerably unstable. While any major fluctuation in prices can be passed on to the customers with a lag, the company would remain exposed to volatility in raw material prices in case of weak demand.
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| Assessment of Adequacy of Credit Enhancement under various scenarios including stress scenarios (applicable for ratings factoring specified support considerations with or without the “CE” suffix) |
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Acuite takes into consideration the benefit derived by AIC group as it has a controlling stake in TADPPL, corporate guarantee provided by holding company for the bank facilities of TADPPL.
Stress Case Scenario While the rating has been derived on the standalone credit risk profile and cash flows of the company, Acuite believes given the controlling stake in TADPPL by AIC group ; in case of any stress case scenario, the required support would come from the AIC group. |
| Rating Sensitivities |
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| Liquidity Position: Adequate |
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During FY2025, the company generated insufficient cash accruals against its debt repayment obligation. The company generated cash accruals of Rs.1.03 Cr. in FY2025, while its maturing debt obligations were Rs. 8.47 Cr. during the same period. However, the repayments were supported by AIC group, the holding company, which infused funds to bridge the gap and meet the shortfall in debt obligations. Going forward the company is expected to generate adequate net cash accruals of Rs. 43-51 Cr. in FY 2025-26 against Rs.23.21-31.23 Cr. debt obligations. The current ratio stood at 1.22 times as on March 31, 2025. Further, the average bank utilization limit for the fund-based limits stood at 94 percent, for the last twelve months ending in November 2025. The company maintains unencumbered cash and bank balances of Rs.8.45 Cr. as on March 31, 2025. Given the support by the holding company AIC group and commencement oof operations in current year FY2026, the liquidity position of the company is expected to be adequate and likely to improve over the medium term.
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| Outlook: Stable |
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| Other Factors affecting Rating |
| None |
| Particulars | Unit | FY 25 (Actual) | FY 24 (Actual) |
| Operating Income | Rs. Cr. | 51.62 | 0.03 |
| PAT | Rs. Cr. | (28.99) | 4.21 |
| PAT Margin | (%) | (56.17) | 13709.27 |
| Total Debt/Tangible Net Worth | Times | 3.28 | 1.89 |
| PBDIT/Interest | Times | 0.92 | (0.51) |
| 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 • 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 • Group And Parent Support: https://www.acuite.in/view-rating-criteria-47.htm |
| Note on complexity levels of the rated instrument |
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*Annexure 2 - List of Entities (applicable for Consolidation or Parent / Group / Govt. Support) | ||||||
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