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| Product | Quantum (Rs. Cr) | Long Term Rating | Short Term Rating |
| Bank Loan Ratings | 25.00 | ACUITE A+ | Stable | Reaffirmed | - |
| Bank Loan Ratings | 5.00 | - | ACUITE A1+ | Assigned |
| Bank Loan Ratings | 40.00 | - | ACUITE A1+ | Reaffirmed |
| Total Outstanding | 70.00 | - | - |
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Rating Rationale |
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Acuite has reaffirmed on the long-term rating to ‘ACUITE A+’ (read as ACUITE A plus) and the short-term rating to ‘ACUITE A1+’ (read as ACUITE A one plus) on the Rs.65.00 crore bank facilities of The Braithwaite Burn And Jessop Construction Company Limited (TBBJCCL). The outlook is ‘Stable’.
Acuite also assigned short-term rating of ‘ACUITE A1+’ (read as ACUITE A one plus) on the Rs.5.00 crore bank facilities of The Braithwaite Burn And Jessop Construction Company Limited (TBBJCCL). Rationale for Rating The reaffirmation of ratings takes into account the company being wholly owned undertaking of Government of India, comfortable financial risk profile and adequate liquidity. However, the ratings are underpinned by a subdued operating margin, low order book and working capital intensive nature of the operation. |
| About the Company |
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The Braithwaite Burn and Jessop Construction Company Limited (TBBJCCL) was incorporated on 1986 for the construction of Howrah Bridge over river Ganga in Kolkata (West Bengal). Three engineering companies viz. Braithwaite & Company (Contributing 40%), Burn & Company Limited (Contributing 40%) and Jessop & Company Limited (Contributing 20%) came together with their long experience and floated a new company The Braithwaite Burn & Jessop Construction Company Limited (BBJ). In 1987 - BBJ became a ‘Government company’ consequent upon transfer of its entire shares to its erstwhile Holding company “Bharat Bhari Udyog Nigam Limited” (BBUNL) and became a wholly owned subsidiary of BBUNL. In 2015, by order of Department of Heavy Industry, Government of India, BBJ (as Transferee Company) has been merged with its holding company BBUNL (as Transferor Company) and the name has changed from ‘Bharat Bhari Udyog Nigam Limited’ to "The Braithwaite Burn and Jessop Construction Company Limited". Currently BBJ enjoys a status of 100 % per cent government owned company.
It is engaged in the construction of steel bridges for railways and other civil construction works. Currently Mr. Aditya Kumar Ghosh, Ms. Sarla Devi, Mr. Rajiv Kumar Singh and Mr. Rakesh Chillar are the directors of the company. |
| Unsupported Rating |
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ACUITE BBB/ Stable
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| Analytical Approach |
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Acuite has considered standalone business and financial risk profile of 'The Braithwaite Burn and Jessop Construction Company Limited'. While arriving at the rating of TBBJCCL, Acuité has notched up the rating since there is a strong level of support from Government of India since it is wholly owned by them.
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| Key Rating Drivers |
| Strengths |
| Wholly owned undertaking of GoI
TBBJCCL was incorporated in January 1986 for the construction of Howrah bridge over river Hooghly in Kolkata (West Bengal). In 1987 - TBBJCCL became a wholly owned subsidiary of Bharat Bhari Udyog Nigam Limited (BBUNL) which was also a 100 per cent Government company. Later in 2015 TBBJCCL was merged with its holding company BBUNL and the name of TBBJCCL was maintained. Currently, TBBJCCL enjoys a status of 100 per cent government owned company. TBBJCCL over the years has constructed numerous major steel bridges for the Indian Railways like Bramhaputra Bridge in Assam, Mahanadi Bridge in Odisha, Ganga Bridge at Mokemah in Bihar, Krishna Bridge in Andhra Pradesh and many more. In 1992 TBBJCCL successfully completed construction of The Second Hooghly Bridge (Vidyasagar Setu, Kolkata), the first long span cable stayed bridge of India. The company is one of few public sector companies having the technical expertise and ability for successful construction of steel bridges for railways. Comfortable financial risk profile The capital structure as represented by debt-equity ratio continues to remain below unity; at 0.30 times in FY24(Provisional). The debt profile of the company comprises of term loan to the tune of Rs.68.51 crore as on March 31, 2023. The same has been carried on since long time and the same was given by Government of India to one of the subsidiaries of Bharat Bhari Udyog Nigam Limited (BBUNL). Post the merger of BBUNL, the loans have been transferred in books of TBBJCCL. As per the management, the same is expected to continue as the subsidiary to which the loan was extended is in liquidation process. The tangible net worth of the company increased to Rs.229.40 crore as on March 31, 2024(Provisional) as against Rs.218.29 crore as on March 31, 2023. The interest coverage ratio also improved significantly to about 12.17 times in FY24(Provisional) over 13.79 times in FY23. The debt service coverage ratio (DSCR) of the company stood about 6.84 times in FY2024(Provisional) as compared to 6.92 times in the previous year. The net cash accruals to total debt (NCA/TD) stood at 0.18 times in FY2024 as compared to 0.15 times in the previous year. Going forward, Acuite believes the financial risk profile of the company will remain healthy on account of steady net cash accruals and no major debt funded capex plan over the near term. |
| Weaknesses |
| Stagnant growth in scale of operations
The revenue of the company stood at Rs.304.73 crore in FY2024 (Provisional) as compared to Rs.301.84 crore in the previous year. The stagnant performance in revenue is on account of no major new works undertaken and slower execution of ongoing projects during last year. In FY2024, it derived ~98% of its total revenue from providing construction contracts services. Going forward, Acuité believes that the revenue of the company will increase on account of well-established presence and comfortable order book position of around Rs. 317 crore as on 31st February 2024. The company reported an improvement in EBITDA to Rs. 15 Crore in FY 2024 (Provisional) compared to Rs.9.05 crore in FY2023 and Rs.1.48 crores in FY22. The same is since most of the projects are in completion stage of the projects. The net profit of TBBJCCL, improved to Rs 12.16 crore in FY24(Provisional) over Rs.8.86 crore in FY23 and Rs. 3.15 Cr. in FY2022. Customer and Geographical Distribution The order book is moderately concentrated on clientele front. The top two clientele contribute to around 63% of total order book., of which 40% of orders are from Northern Frontier Railways. The receivables are realized within 45 days on submission of bill. Furthermore,The major portion, 39.75% is being executed in Mizoram, thereby reporting moderate client concentration. However, with Mizoram mostly affected by monsoon and terrains, the work execution is expected to be challenging. The company uses its own equipment for the execution of work orders and thus, the resources are mobilised at project site. |
| Rating Sensitivities |
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| Liquidity Position |
| Adequate |
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The liquidity profile of the company continues to remain at adequate level with net cash accruals of about Rs.12.40 crore(FY24 provisional) in absence of any significant debt repayment obligation. The company also maintained cash and bank balance of Rs.10.70 crore as on March 31, 2023. The current ratio of the company continues to remain above unity at 1.34 times as on March 31, 2023. The company has been undertaking capex for less than Rs.5 crore, out of net cash accruals. The company has also been maintaining deposits with banks to the tune of Rs.102.82 crore as on March 31, 2023. The bank limit of the company has been~25 percent utilized during the last eight months ended in February 2024. Acuité believes that the liquidity of the company is likely to remain adequate over the medium term on account of comfortable cash accruals against long debt repayments over the medium term.
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| Outlook: Stable |
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Acuité believes that TBBJCCL will maintain a stable outlook in the medium term on the back of the support of the Government of India, established track record of project execution and relations with reputed clients. The outlook may be revised to ‘Positive’ in case of significant and sustainable growth in revenue while maintaining operating margins and efficiently managing its working capital cycle. Conversely, the outlook may be revised to ‘Negative’ in case of a sharp decline in net cash accruals and significant elongation of working capital cycle.
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| Other Factors affecting Rating |
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None
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| Particulars | Unit | FY 23 (Actual) | FY 22 (Actual) |
| Operating Income | Rs. Cr. | 301.84 | 137.11 |
| PAT | Rs. Cr. | 8.86 | 3.15 |
| PAT Margin | (%) | 2.93 | 2.30 |
| Total Debt/Tangible Net Worth | Times | 0.32 | 0.33 |
| PBDIT/Interest | Times | 13.79 | 20.83 |
| Status of non-cooperation with previous CRA (if applicable) |
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Not Applicable
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| Any other information |
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None
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| 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 • Service Sector: https://www.acuite.in/view-rating-criteria-50.htm |
| Note on complexity levels of the rated instrument |
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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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| *Annexure 2 - List of Entities (applicable for Consolidation or Parent / Group / Govt. Support) | ||||||
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