By Barath Ramjee

India Ratings and Research (Ind-Ra) has rated Gallantt Metal Limited’s (Gallantt) additional bank loan as follows:

Instrument Type

Date of Issuance

Coupon Rate (%)

Maturity Date

Size of Issue (million)

Rating

Rating Action

Non-fund-based limits

-

-

-

INR38

IND A1

Assigned

KEY RATING DRIVERS

For Gallantt’s detailed rationale, please click here.


RATING SENSITIVITIES

Positive: A significant increase in the scale of operations along with the maintenance of the EBITDA margin and credit metrics on a sustained basis could lead to a positive rating action.

Negative: A sustained increase in net leverage above 1x would lead to a negative rating action.


COMPANY PROFILE

Incorporated in 2005, Gallantt manufactures sponge iron, mild steel billets and re-rolled products (thermo- mechanically treated bars). It also has a 33MW captive power plant. Gallantt is promoted by Mr Chandra Prakash Agrawal and is listed on the Bombay Stock Exchange and the National Stock Exchange.

 

FINANCIAL SUMMARY

 

Particulars

FY18

FY17

Revenue (INR million)

8,456

6,167

EBITDA (INR million)

865

526

Interest Cost (INR million)

66

63

EBITDA margin (%)

10.2

8.5

Gross interest coverage (x)

13.18

8.37

Net leverage (x)

0.63

1.41

Source: Gallantt, Ind-Ra


RATING HISTORY

Instrument Type

Current Rating/Outlook

Historical Rating/Outlook

Rating Type

Rated Limits (million)

Rating

29 August 2018

10 July 2017

21 March 2016

Issuer rating

Long-term

-

IND A/Stable

IND A/Stable

IND A-/Stable

IND A-/Stable

Fund-based limits

Long-/short-term

INR500

IND A/Stable/IND A1

IND A/Stable/IND A1

IND A-/Stable/IND A2+

IND A-/Stable/IND A2+

Non-fund-based limits

Short-term

INR1,288

IND A1

IND A1

IND A2+

IND A2+


COMPLEXITY LEVEL OF INSTRUMENTS

For details on the complexity levels of the instruments, please visit https://www.indiaratings.co.in/complexity-indicators.

SOLICITATION DISCLOSURES

Additional information is available at www.indiaratings.co.in. The ratings above were solicited by, or on behalf of, the issuer, and therefore, India Ratings has been compensated for the provision of the ratings. 

Ratings are not a recommendation or suggestion, directly or indirectly, to you or any other person, to buy, sell, make or hold any investment, loan or security or to undertake any investment strategy with respect to any investment, loan or security or any issuer.

ABOUT INDIA RATINGS AND RESEARCH

About India Ratings and Research: India Ratings and Research (Ind-Ra) is India's most respected credit rating agency committed to providing India's credit markets accurate, timely and prospective credit opinions. Built on a foundation of independent thinking, rigorous analytics, and an open and balanced approach towards credit research, Ind-Ra has grown rapidly during the past decade, gaining significant market presence in India's fixed income market. 

Ind-Ra currently maintains coverage of corporate issuers, financial institutions (including banks and insurance companies), finance and leasing companies, managed funds, urban local bodies and project finance companies. 

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Applicable Criteria

Analyst Names

  • Primary Analyst

    Barath Ramjee

    Associate Director
    India Ratings and Research Pvt Ltd Wockhardt Towers, 4th floor, West Wing Plot C-2, G Block. Bandra Kurla Complex Bandra (East), Mumbai 400051
    +91 22 40356168

    Media Relation

    Namita Sharma

    Manager – Corporate Communication
    +91 22 40356121