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Rating Rationale
Brickwork Ratings revises the rating from ‘BWR A’ to ‘BWR BB-’ with
Negative Outlook for Gayatri Project Ltd’s Non-Convertible Debenture
(NCD) issue of ₹ 31.40 Crore
Brickwork Ratings (BWR) has revised the Ratings1 from BWR A (Pronounced BWR Single A)
to BWR BB- (Pronounced BWR Double B Minus) with Negative Outlook for Gayatri Projects
Ltd’s (GPL) ₹ 31.40 crore (Rupees Thirty One Crores and Forty Lakhs Only) NCD issue. The
original rated amount of the issue was ₹ 100.00 Cr, out of which the company raised only ₹
52.00 Cr.
Instrument
NCD
Current
Outstanding
( ₹ Cr)
31.40
Previous
Rated Amount
( ₹ Cr)
36.40
Present
Rating
Previous
Rating
BWR BB-
BWR A
(Pronounced
(Pronounced BWR
BWR Double B
Single A)
Minus)
Outlook:
Negative
(Oct 2014)
Outlook:
Negative
The rating revision has factored the company’s reduced revenue as compared to previous
periods, working capital intensive nature of the business, strained cash flows and stretched
liquidity with uncertainty in timely collection of huge receivables. The rating continues to draw
strength from GPL’s experienced promoters and long track record.
Background Information:
Gayatri Projects Ltd is a public listed company head-quartered in Hyderabad and engaged in the
execution of major Civil Works including Concrete/Masonry Dams, Earth Filling Dams,
National Highways, Bridges, Canals, Aqueducts, Ports, etc. It also has joint ventures (JVs) in
Build-Operate-Transfer (BOT) projects and executes construction contracts in partnership with
Indian and overseas companies. Its two subsidiaries, Gayatri Infra Ventures Ltd (GIVL) and
Gayatri Energy Ventures Private Ltd (GEVPL), incorporated in 2008, are the Asset
Development arms for the Company. GIVL operates as an investment and construction
company in transport infrastructure while GEVPL was set up to undertake power generation
projects.
In FY14, the company had achieved Net Sales of Rs. 1804.77 Cr, with a PAT of Rs. 47.61 Cr. For
the 9 month period ended 31 Dec 2014, Net Sales fell by 21% to Rs. 1036.13 Cr, and PAT fell by
1
Please refer to www.brickworkratings.com for definition of the Ratings
www.brickworkratings.com
1
27 Feb 2015
81% to Rs. 6.10 Cr. The company is facing severe liquidity issues on account of stretched
receivables, and its bank accounts are reported irregular. As a result company’s credit risk
profile is badly affected, and the outlook in the short to medium term is negative.
Analyst Contact
Relationship Contact
[email protected]
[email protected]
Phone
Media Contact
1-860-425-2742
[email protected]
Disclaimer: Brickwork Ratings (BWR) has assigned the rating based on the information obtained from the issuer and other reliable sources,
which are deemed to be accurate. BWR has taken considerable steps to avoid any data distortion; however, it does not examine the precision or
completeness of the information obtained. And hence, the information in this report is presented “as is” without any express or implied warranty
of any kind. BWR does not make any representation in respect to the truth or accuracy of any such information. The rating assigned by BWR
should be treated as an opinion rather than a recommendation to buy, sell or hold the rated instrument and BWR shall not be liable for any losses
incurred by users from any use of this report or its contents. BWR has the right to change, suspend or withdraw the ratings at any time for any
reasons.
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2
27 Feb 2015