| Kapston Facilities Management Limited | ||||||
| 'CRISIL BBB / Stable / CRISIL A3+ ' assigned to Bank Debt | ||||||
| Rating Action | ||||||
| ||||||
| 1 crore = 10 million | ||||||
| Refer to Annexure for Details of Instruments & Bank Facilities |
Detailed Rationale CRISIL has assigned its ‘CRISIL BBB/Stable/CRISIL A3+’ ratings to the bank facilities of Kapston Facilities Management Limited (KFML).
The ratings reflect KFML's experienced management, established track record of operation and healthy financial profile. These strength are partially offset by its moderate scale of operations and moderately working capital intensive operations. |
Key Rating Drivers & Detailed Description Strengths:
The company is promoted by Mr. Kodali Srikanth, who has over a decade of experience in facilities management and security services. Mr. Chereddi Ramachandra Naidu is the Chairman of the KMFL. He is a retired Inspector General of Police for the State of Andhra Pradesh and he guides the team on human resource management, industrial relations, strategy and project management. They are further supported the other directors, Mr. Naveen Nandigam, who is a Chartered Accountant and Ms. Doddapaneni Kranti Kiran.
Financial risk profile is marked by moderate networth, comfortable capital structure and adequate debt protection metrics.
Networth remains moderate at Rs. 44.94 Cr as on March 31, 2020. With accretion of around Rs. 8-9 Cr every year, networth is expected to be around Rs. 55-60 Cr over the medium term. Capital structure remains comfortable with gearing of 1.09 times as on March 31, 2020. With no major debt funded capex plans and healthy buildup of networth, gearing is expected to be around 0.85 times for FY21. Debt protection metrics remain adequate with interest cover of around 4 times and NCATD of 25 % for FY20. Debt protection metrics are expected to remain comfortable over the medium term.
Weaknesses:
With operating income of Rs. 213 Cr for FY20, scale of operations remains moderate in the intensively competitive industry. Sustained improvement in scale of operations remain a key rating sensitivity factor over the medium term.
Operations remain moderately working capital intensive as indicated by gross current assets 150 days as on March 31, 2020. GCA days is driven by debtors of 112 days as on March 31, 2020. |
Liquidity: Adequate Liquidity profile remains adequate with healthy cushion between cash accruals and repayment obligations and low bank limit utilization. KFML is expected to generate cash accruals above Rs. 11 Cr against repayment obligations of around Rs. 1.4 Cr for FY21. Bank limit utilization remains low at 62 % for the past 12 months ending October 2020. |
Outlook: Stable CRISIL believe KFML will continue to benefit from the extensive experience of its promoter, and established relationships with clients. |
Rating Sensitivity factors Upward factor
Downward factor
|
About the Company Incorporated in 2009, KFML is ISO 9001 & OHSAS 18001:2007 certified for providing integrated facility management services for security, housekeeping, M&E (Electro Mechanical) and landscaping (Horticulture) and allied services. KFML is listed on National Stock Exchange of India Limited. The company is promoted by Mr. Kodali Srikanth. |
Key Financial Indicators
|
Any other information: Not applicable |
| Note on complexity levels of the rated instrument: CRISIL complexity levels are assigned to various types of financial instruments. The CRISIL complexity levels are available on www.crisil.com/complexity-levels. Users are advised to refer to the CRISIL complexity levels for instruments that they consider for investment. Users may also call the Customer Service Helpdesk with queries on specific instruments. |
Annexure - Details of Instrument(s)
|
| Annexure - Rating History for last 3 Years | ||||||||||||||||||||||||||||||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||||||||||||||||||||||
| All amounts are in Rs.Cr. | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| Annexure - Details of various bank facilities | ||||||||||||||||||||||||||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||||||||||||||||||
|