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| Product | Quantum (Rs. Cr) | Long Term Rating | Short Term Rating |
| Bank Loan Ratings | 127.20 | ACUITE C | Downgraded | - |
| Bank Loan Ratings | 59.80 | - | ACUITE A4 | Reaffirmed |
| Total Outstanding Quantum (Rs. Cr) | 187.00 | - | - |
| Rating Rationale |
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Acuite has downgraded its long-term rating to 'ACUITE C' (read as ACUITE double C) from 'ACUITE BB-' (read as ACUITE double B minus) and short-term rating of 'ACUITE A4' (read as ACUITE A four) on Rs 187 crore bank loan facilities of V M Matere Infrastructures India Private Limited (VMM). Rationale for the rating The downgrade is on the basis of credit bureau information report about ongoing delays in their repayments and other publicly available information. |
| About the Company |
| V.M. Matere Infrastructures (India) Private Limited was established in the year 1993 as a proprietorship firm by Mr. Vishnu Mahadev Matere at Pune, Maharashtra. It was converted into a private limited company in 2007. VMM undertakes residential, commercial & industrial and civil construction, primarily related to flyovers, bridges, roads and buildings for government agencies such as the Public Works Department, Military Engineering Services and Pimpri Chinchwad Municipal Corporation (PCMC). It has completed some major reputed projects in the past for various Government bodies. The day-to-day operations are managed by Mr. Vishnu Mahadev Matere and Mr. Sindhu Vishnu Matere. |
| Analytical Approach |
| Acuité has taken a standalone view of the business and financial risk profile of VMM to arrive at the rating. |
Key Rating Drivers
| Strengths |
| Established track record and experienced management V.M. Matere Infrastructures (India) Private Limited was established in the year 1993 as a proprietorship firm and then coverted into a private limited company in 2007.The company is promoted by Mr. Vishnu Mahadev Matere & Sindhu Vishnu Matere who has an experience of more than a decade in the business . VMM undertakes residential, commercial & industrial and civil construction, primarily related to flyovers, bridges, roads and buildings for government agencies such as the Public Works Department, Military Engineering Services and Pimpri Chinchwad Municipal Corporation (PCMC). It has completed some major reputed projects in the past for various Government bodies. The established track record and experience of management is also reflected through Y-o-Y growth in revenue, |
| Weaknesses |
| Delays in servicing of bank facilities availed
There have been delays in servicing of debt obligations by the company as per credit bureau information reports and other publicly available information. Highly Competitive Industry The infrastructure is a fairly fragmented industry with a presence of few large pan India players where subcontracting & project specific partnerships for technical/financial reasons are fairly common. The company faces stiff competition with its competitors in procuring orders through bidding, immense competition for procuring tenders leads to very competitive pricing which in turn lead to stress on the margins. Moreover, susceptibility of raw material pricing again keeps profit margin vulnerable and is a key sensitivity factor. However, presence of price escalation clause prevents the company from exposure to raw material price fluctuations to some extent. |
| Rating Sensitivities |
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| All Covenants |
| None |
| Liquidity Position |
| Poor |
| Liquidity of the company is poor marked by delays in servicing of debt obligations towards bank loans availed by the company |
| Outlook: Not Applicable |
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| Other Factors affecting Rating |
| Not Applicable |
| Particulars | Unit | FY 22 (Actual) | FY 21 (Actual) |
| Operating Income | Rs. Cr. | 214.99 | 191.38 |
| PAT | Rs. Cr. | 5.62 | 6.55 |
| PAT Margin | (%) | 2.62 | 3.42 |
| Total Debt/Tangible Net Worth | Times | 0.66 | 0.93 |
| PBDIT/Interest | Times | 2.10 | 2.47 |
| 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 • Infrastructure Sector: https://www.acuite.in/view-rating-criteria-51.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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