ICRA Assigns 'D' Rating to Print Solutions Private Limited's Bank Facilities

Strategic Insights -

Print Solutions Private Limited (PSPL), a part of the Century 21 group involved in real estate development in the Indore region, has been assigned a long-term rating of 'ICRA D' (pronounced ICRA D) to its Rs. 11.0 crore bank facilities by ICRA. The rating is driven by delays in debt servicing by PSPL due to its weak liquidity position. The company's revenue concentration risk is also a significant concern, as most of its revenues emanate from a single property, accentuating the risk of delays in debt servicing due to delay in payment of lease rent by the lessee. Despite the established track record of the promoters in the real estate business, the key rating sensitivities going forward will be the company's ability to build up a satisfactory track record of timely debt servicing and maintain a satisfactory liquidity position.

Key Takeaways:

  • ICRA has assigned a long-term rating of 'ICRA D' (pronounced ICRA D) to Print Solutions Private Limited's Rs. 11.0 crore bank facilities.
  • The rating is driven by delays in debt servicing by PSPL due to its weak liquidity position.
  • The company's revenue concentration risk is a significant concern, with most of its revenues emanating from a single property.
  • The established track record of the promoters in the real estate business is a positive factor, but it is outweighed by the company's liquidity concerns.
  • The key rating sensitivities going forward will be the company's ability to build up a satisfactory track record of timely debt servicing and maintain a satisfactory liquidity position.
  • Print Solutions Private Limited has reported a profit after tax of Rs. 1.08 crore against an operating income of Rs. 2.0 crore in 2014-15.

Statistics:

  • Rs. 11.0 crore assigned to Print Solutions Private Limited's bank facilities.
  • 100% (all) of Print Solutions Private Limited's revenues emanate from a single property.
  • Rs. 1.08 crore profit after tax for Print Solutions Private Limited in 2014-15.
  • Rs. 2.0 crore operating income for Print Solutions Private Limited in 2014-15.

Sources:

  • ICRA, "ICRA Assigns 'D' Rating to Print Solutions Private Limited's Bank Facilities" (copyright, 2015, ICRA Limited), http://www.icra.in/.