Rating Rationale

June 26, 2015

Mumbai

Merlin Projects Limited

Rating Suspended

Total Bank Loan Facilities Rated	Rs.300 Million
Long Term Rating	Suspended

(Refer to Annexure 1 for Facility-wise details)

CRISIL has suspended its rating on the bank facilities of Merlin Projects Ltd (MPL; part of the Merlin group). The suspension of ratings is on account of non-cooperation by MPL with CRISIL's efforts to undertake a review of the ratings outstanding. Despite repeated requests by CRISIL, MPL is yet to provide adequate information to enable CRISIL to assess MPL's ability to service its debt. The suspension reflects CRISIL's inability to maintain a valid rating in the absence of adequate information. CRISIL considers information availability risk as a key credit factor in its rating process and non-sharing of information as a first signal of possible credit distress, as outlined in its criteria 'Information Availability Risk in Credit Ratings'

About the Group

For arriving at the rating, CRISIL has combined the financial and business risk profiles of MPL and its two subsidiaries, Bengal Merlin Housing Ltd (BMHL) and Bengal Merlin Infrastructure Ltd (BMIL). This is because all three companies, together referred to as the Merlin group, are in the same line of business and under common promoters, and there are significant financial linkages between them. In respect of the joint ventures (JVs) entered into by Merlin group, CRISIL has factored in the group's share in the profit/loss in these JVs, and its likely investment, if any, in them.

MPL was started by the Kolkata-based Mohta family, promoted by Mr. Shiv Kishan Mohta, and is currently managed by Mr. Sushil Mohta. MPL was originally established in 1976 as a partnership firm, which was reconstituted in 1984 as a private limited company, and later, in 1992, as a closely held public limited company with the current name. MPL is the flagship company of the Merlin group, which has a track record of around four decades in the real estate business. The group has primarily focused on construction of residential and commercial space in and around Kolkata. However, since the past three to four years it has also entered into JVs to develop properties in Ahmedabad (Gujarat) and Raipur (Chhattisgarh).

Annexure 1 - Details of various bank facilities

Current facilities			Previous facilities
Facility	Amount (Rs.Million)	Rating	Facility	Amount (Rs.Million)	Rating
Cash Credit	120	Suspended	Cash Credit	120	CRISIL BBB-/Stable
Term Loan	180	Suspended	Term Loan	180	CRISIL BBB-/Stable
Total	300	--	Total	300	--

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June 26, 2015	http://www.crisil.com