By Ashish Agrawal

India Ratings and Research (Ind-Ra) has affirmed Nagarjuna Fertilizers and Chemicals Limited’s (NFCL) Long-Term Issuer Rating at ‘IND D’. The instrument-wise rating actions are given below:

Instrument Type

Date of Issuance

Coupon Rate

Maturity Date

Size of Issue (million)

Rating

Rating Action

Fund-based limit (Long-term)

-

-

-

INR8,030

IND D

Affirmed

Non-fund-based limit (Short-term)

-

-

-

INR11,796.7 (reduced from INR11,811.1)

IND D

Affirmed

Long-term loans

-

-

FY20-FY24

INR4,731.4 (reduced from INR5,454.9)

IND D

Affirmed

KEY RATING DRIVERS

The affirmation reflects NFCL’s continued delays in debt servicing during the 12 months ended March 2019, due to its tight liquidity position.


RATING SENSITIVITIES

Positive: Timely debt servicing for three consecutive months could result in a positive rating action.
       

 


COMPANY PROFILE

Established in 1987, NFCL manufactures and supplies plant nutrients. The company has two urea plants in Andhra Pradesh, with total capacity of 1.19mmtpa. It also trades in other fertilisers such as di-ammonium phosphate, mono-ammonium phosphate, muriate of potash, water soluble fertilisers, micronutrients, bio-products, customised fertilisers, and seeds. 

FINANCIAL SUMMARY
 

Particulars

9MFY19

FY18

FY17

Revenue (INR million)

14,301

39,237

33,851

EBITDA (INR million)

-857

3,260

2,207

EBITDA margin (%)

-6.0

8.3

6.5

Interest coverage (x)

-0.4

1.1x

0.7x

Source: NFCL, Ind-Ra


RATING HISTORY

Instrument Type

Current Rating

Historical Rating

Rating Type

Rated Limits (million)

Rating

20 February 2018

30 December 2016

8 September  2015

Issuer rating

Long-term

-

IND D

IND D

IND D

IND D

Fund based limit

Long-term

INR8,030

IND D

IND D

IND D

IND D

Non-fund based limit

Short-term

INR11,796.7

IND D

IND D

IND D

IND D

Long-term loans

Long-term

INR4,731.4

IND D

IND D

IND D

IND D


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. 

Headquartered in Mumbai, Ind-Ra has seven branch offices located in Ahmedabad, Bengaluru, Chennai, Delhi, Hyderabad, Kolkata and Pune. Ind-Ra is recognised by the Securities and Exchange Board of India, the Reserve Bank of India and National Housing Bank. 

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For more information, visit www.indiaratings.co.in.

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Applicable Criteria

Analyst Names

  • Primary Analyst

    Ashish Agrawal

    Analyst
    India Ratings and Research Pvt Ltd DLF Epitome, Level 16, Building No. 5, Tower B DLF Cyber City, Gurgaon Haryana 122002
    0124 6687241

    Media Relation

    Namita Sharma

    Manager – Corporate Communication
    +91 22 40356121