Zen Technologies Limited

April 07, 2022

Ratings
Instrument Amount Complexity
Ratings Rating Action
/ Facility (Rs. crore) Indicator
Rating continues to
Long Term IVR BB (ISSUER remain under
Bank NOT ISSUER NOT
Facilities – COOPERATING*) COOPERATING
10.26 Simple
Fund Based (IVR Double B; category and
– Term ISSUER NOT Revised from IVR
Loan COOPERATING*) BB+ (IVR Double B
Plus)
Rating continues to
Long Term IVR BB (ISSUER remain under
Bank NOT ISSUER NOT
Facilities – COOPERATING*) COOPERATING
30.00 Simple
Fund Based (IVR Double B; category and
– Cash ISSUER NOT Revised from IVR
Credit COOPERATING*) BB+ (IVR Double B
Plus)
Rating continues to
Long Term /
IVR BB / IVR A4 remain under
Short Term
(ISSUER NOT ISSUER NOT
Bank
COOPERATING*) COOPERATING
Facilities –
72.00 (IVR Double B / category and Simple
Non Fund
IVR A Four; Revised from IVR
Based –
ISSUER NOT BB+ / IVR A4+ (IVR
Bank
COOPERATING*) Double B Plus / IVR
Guarantee
A Four Plus)
Rating continues to
Short Term
IVR A4 (ISSUER remain under
Bank
NOT ISSUER NOT
Facilities –
COOPERATING*) COOPERATING
Non Fund 15.00 Simple
(IVR A Four; category and
Based –
ISSUER NOT Revised from IVR
Letter of
COOPERATING*) A4+ (IVR A Four
Credit
Plus)
127.26
(Rupees One
Twenty Seven
Total
Crore and
Twenty Six
Lakhs Only)
* Issuer did not cooperate; Based on best available information

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Details of Facilities are in Annexure 1

Detailed Rationale
The rating has been moved to issuer not cooperating because of lack of adequate
information regarding performance of Zen Technologies Limited and hence the uncertainty
around its credit risk. Infomerics assesses whether the information available about the
company is commensurate with its rating and reviews the same as per its policy.
The lender, investors and other users of this rating are requested to exercise adequate
caution while using this rating as this rating may not adequately reflect the current credit risk
profile of the company, despite the rating revision.

Non-cooperation by Issuer
Infomerics has been regularly following up with the company to provide the required data,
results to monitor its assigned rating to the bank facilities, vide E-mail communications dated
March 21, 2022, March 22, 2022 and March 23, 2022 concurrently over several phone calls.
However, despite repeated requests by Infomerics, the company’s management has not
submitted the essential details. Accordingly, the lenders, investors and other users of this
rating are requested to exercise adequate caution while using this rating as this rating may
not adequately reflect the current credit risk profile of the company.

Availability of information is very critical in rating exercise. In the absence of the requisite
information, in consonance with SEBI guidelines, Infomerics must assign the rating based on
the best available information. Accordingly, the ratings for the bank loan facilities of Zen
Technologies Limited aggregating to Rs.127.26 crore shall be moved to the ‘ISSUER NOT
COOPERATING’ category by Infomerics and the rating be noted as IVR BB; Issuer Not Co-
operating*; Based on best available information and IVR A4; Issuer Not Co-operating*;
Based on best available information.

Analytical Approach: Standalone

Applicable Criteria:
Guidelines on what Constitute Non-Cooperation by Client
2
Rating Methodology – Manufacturing Companies
Financial Ratios & Interpretation (Non-Financial Sector)

About the Company

Incorporated in 1993, Zen Technologies Limited designs, develops and manufactures
combat training simulator/solutions for the training of defence and security forces. Zen
Technologies is headquartered in Hyderabad, India with offices in India and USA. Zen
Technologies Limited is an ISO 9001:2015 (QMS), ISO 14001:2015 (EMS), ISO/IEC
27001:2013 (ISMS) and CMMI Maturity Level 5 company. Zen Technologies is publicly listed
on Bombay Stock Exchange and the National Stock exchange.

Financials (Stanalone)*:
(Rs. Crore)
31-Mar-2020 31-Mar-2021
For the year ended / As on
(Audited) (Audited)
Total Operating Income 146.98 49.57
EBITDA 63.59 7.75
PAT 60.51 4.10
Total Debt 0.88 0.85
Tangible Net worth 178.40 192.47
EBITDA Margin (%) 43.27 15.64
PAT Margin (%) 41.17 8.26
Overall Gearing Ratio (times) 0.00 0.00
*Classification as per Infomerics standards

Status of non-cooperation with previous CRA: Nil

Any other information: Nil

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Rating History for last three years:
Current Ratings (Year 2021-22) Rating History for the past 3 years
Date(s) & Date(s) & Date(s) &
Name of Amount
Sr. Rating(s) Rating(s) Rating(s)
Instrument / Type outstanding Rating
No. assigned in assigned in assigned
Facilities (Rs. Crore)
2020-21 2019-20 in 2018-19
16-Feb-2021 10-Dec-2019
IVR BB / IVR BB+ / IVR BBB+ /
Fund Based Long
1. 10.26 Issuer not Issuer not Stable –
– Term Loan Term
cooperating* cooperating* Outlook
IVR BB / IVR BB+ / IVR BBB+ /
Fund Based Long
2. 30.00 Issuer not Issuer not Stable –
– Cash Credit Term
cooperating* cooperating* Outlook
Long
Non Fund IVR BB / IVR IVR BB+ / IVR BBB+ /
Term
Based – A4; Issuer IVR A4+ Stable
3. / 72.00 –
Bank not Issuer not Outlook / IVR
Short
Guarantee cooperating* cooperating* A2
Term
Non Fund
IVR A4 / IVR A4+ /
Based – Short
4. 15.00 Issuer not Issuer not IVR A2 –
Letter of Term
cooperating* cooperating*
Credit
* Issuer did not cooperate; Based on best available information

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Name and Contact Details of the Rating Analyst:
Name: Mr. Rupesh Dhuri Name: Mr. Noman Agashiwala
Tel: (022) 62396023 Tel: (022) 62396023
Email: [email protected] Email: [email protected]

About Infomerics:
Infomerics commenced rating & grading operations in April 2015 after having spent over 25
years in various segments of financial services. Infomerics is registered with the Securities
and Exchange Board of India (SEBI) and accredited by Reserve Bank of India. It is gradually
gaining prominence in domestic rating and/or grading space. Infomerics is striving for
positioning itself as the most trusted & credible rating agency in the country and is gradually
widening its product portfolio. Company’s long experience in varied spectrum of financial
services is helping it to fine-tune its product offerings to best suit the market.

Disclaimer: Infomerics ratings are based on information provided by the issuer on an ‘as is where is’ basis.
Infomerics credit ratings are an opinion on the credit risk of the issue / issuer and not a recommendation to buy,
hold or sell securities. Infomerics reserves the right to change, suspend or withdraw the credit ratings at any
point in time. Infomerics ratings are opinions on financial statements based on information provided by the
management and information obtained from sources believed by it to be accurate and reliable. The credit quality
ratings are not recommendations to sanction, renew, disburse or recall the concerned bank facilities or to buy,
sell or hold any security. We, however, do not guarantee the accuracy, adequacy or completeness of any
information, which we accepted and presumed to be free from misstatement, whether due to error or fraud. We
are not responsible for any errors or omissions or for the results obtained from the use of such information. Most
entities whose bank facilities/instruments are rated by us have paid a credit rating fee, based on the amount and
type of bank facilities/instruments. In case of partnership/proprietary concerns/Association of Persons (AOPs),
the rating assigned by Infomerics is based on the capital deployed by the partners/proprietor/ AOPs and the
financial strength of the firm at present. The rating may undergo change in case of withdrawal of capital or the
unsecured loans brought in by the partners/proprietor/ AOPs in addition to the financial performance and other
relevant factors.

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Annexure 1: Details of Facilities

Size of
Date of Coupon Maturity Rating Assigned/
Name of Facility Facility
Issuance Rate/ IRR Date Outlook
(Rs. Crore)
IVR BB (ISSUER
Long Term NOT
Bank Facilities – – Mar – 2022 10.26 COOPERATING*)
– Fund Based (IVR Double B;
– Term Loan ISSUER NOT
COOPERATING*)
IVR BB (ISSUER
Long Term NOT
Bank Facilities 30.00 COOPERATING*)
– – –
– Fund Based (IVR Double B;
– Cash Credit ISSUER NOT
COOPERATING*)
Long Term / IVR BB / IVR A4
Short Term (ISSUER NOT
Bank Facilities 72.00 COOPERATING*)
– –
– Non Fund (IVR Double B / IVR
Based – Bank A Four; ISSUER NOT
COOPERATING*)
Guarantee
Short Term IVR A4 (ISSUER
Bank Facilities NOT
COOPERATING*)
– Non Fund – – 15.00
(IVR A Four; ISSUER
Based – Letter NOT
of Credit COOPERATING*)
* Issuer did not cooperate; Based on best available information

Annexure 2: List of companies considered for consolidated analysis: Not Applicable

Annexure 3: Facility wise lender details

https://www.infomerics.com/admin/prfiles/Len-Zen-Technologies-apr22.pdf

Annexure 4: Detailed explanation of covenants of the rated instrument/facilities: Not

Applicable

Note on complexity levels of the rated instrument: Infomerics has classified instruments
rated by it on the basis of complexity and a note thereon is available at www.infomerics.com.