Original T emplate123

Rating Update
September 15, 2023 | Mumbai

D.P.M.K. Fertilizers Private Limited

Update as on September 15, 2023

This update is provided in continuation of the rating rational below.

The key rating sensitivity factors for the rating include:

Upward factors

• Sustained improvement in revenue of 30%, resulting in higher cash accrual

• Improvement in TOLANW ratio below 1.5 times

Downward Factors

• Any debt funded capex constraining financial flexibility

• A decline in the interest coverage ratio to below 1.5times

CRISIL Ratings has a policy of keeping its accepted ratings under constant and ongoing monitoring and
review. Accordingly, CRISIL Ratings seeks regular updates from companies on the business and financial
performance. CRISIL Ratings is, however, awaiting adequate information from D.P.M.K. Fertilizers
Private Limited (DPMK) which will enable us to carry out the rating review. CRISIL Ratings will continue
provide updates on relevant developments from time to time on this credit.

CRISIL Ratings also identifies information availability risk as a key credit factor in the rating assessment
as outlined in its criteria ‘Information Availability Risk in Credit Ratings’.

About the Company

DPMK was established as a proprietorship firm in 1990 and reconstituted as a private limited company
with the current name in 2009. Mrs Dwarika Gupta manages operations. The company is a distributor of
organic and inorganic fertiliser in Chhattisgarh, Madhya Pradesh, and Odisha

Please note: This advisory should not be construed as a rating reaffirmation.

Note for Media:
This rating rationale is transmitted to you for the sole purpose of dissemination through your newspaper/magazine/agency. The rating
rationale may be used by you in full or in part without changing the meaning or context thereof but with due credit to CRISIL Ratings.
However, CRISIL Ratings alone has the sole right of distribution (whether directly or indirectly) of its rationales for consideration or
otherwise through any media including websites and portals.

About CRISIL Ratings Limited (A subsidiary of CRISIL Limited, an S&P Global Company)

CRISIL Ratings pioneered the concept of credit rating in India in 1987. With a tradition of independence, analytical
rigour and innovation, we set the standards in the credit rating business. We rate the entire range of debt
instruments, such as bank loans, certificates of deposit, commercial paper, non-convertible/convertible/partially
convertible bonds and debentures, perpetual bonds, bank hybrid capital instruments, asset-backed and mortgage-
backed securities, partial guarantees and other structured debt instruments. We have rated over 33,000 large and
mid-scale corporates and financial institutions. We have also instituted several innovations in India in the rating
business, including ratings for municipal bonds, partially guaranteed instruments and infrastructure investment
trusts (InvITs).

CRISIL Ratings Limited ('CRISIL Ratings') is a wholly-owned subsidiary of CRISIL Limited ('CRISIL'). CRISIL
Ratings Limited is registered in India as a credit rating agency with the Securities and Exchange Board of India
("SEBI").

For more information, visit www.crisilratings.com

About CRISIL Limited

CRISIL is a leading, agile and innovative global analytics company driven by its mission of making markets
function better.

It is India’s foremost provider of ratings, data, research, analytics and solutions with a strong track record of
growth, culture of innovation, and global footprint.

It has delivered independent opinions, actionable insights, and efficient solutions to over 100,000 customers
through businesses that operate from India, the US, the UK, Argentina, Poland, China, Hong Kong and Singapore.

It is majority owned by S&P Global Inc, a leading provider of transparent and independent ratings, benchmarks,
analytics and data to the capital and commodity markets worldwide.

For more information, visit www.crisil.com

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Please note: This advisory should not be construed as a rating reaffirmation.

DISCLAIMER

This disclaimer is part of and applies to each credit rating report and/or credit rating rationale ('report') that is
provided by CRISIL Ratings Limited ('CRISIL Ratings'). To avoid doubt, the term 'report' includes the information,
ratings and other content forming part of the report. The report is intended for the jurisdiction of India only.
This report does not constitute an offer of services. Without limiting the generality of the foregoing, nothing in
the report is to be construed as CRISIL Ratings providing or intending to provide any services in jurisdictions
where CRISIL Ratings does not have the necessary licenses and/or registration to carry out its business activities
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report. In preparing our report we have not taken into consideration the objectives or particular needs of any
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publication in any form or format although CRISIL Ratings may disseminate its opinions and analysis. The rating
contained in the report is not a substitute for the skill, judgment and experience of the user, its management,
employees, advisors and/or clients when making investment or other business decisions. The recipients of the
report should rely on their own judgment and take their own professional advice before acting on the report in
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PARTY DISCLAIMS ANY AND ALL EXPRESS OR IMPLIED WARRANTIES, INCLUDING BUT NOT LIMITED TO ANY
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lost income or lost profits and opportunity costs) in connection with any use of any part of the report even if
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issuers or underwriters of the instruments, facilities, securities or from obligors. Public ratings and analysis by
CRISIL Ratings, as are required to be disclosed under the regulations of the Securities and Exchange Board of
India (and other applicable regulations, if any), are made available on its website, www.crisilratings.com (free of
charge). Reports with more detail and additional information may be available for subscription at a fee - more
details about ratings by CRISIL Ratings are available here: www.crisilratings.com.

CRISIL Ratings and its affiliates do not act as a fiduciary. While CRISIL Ratings has obtained information from
sources it believes to be reliable, CRISIL Ratings does not perform an audit and undertakes no duty of due
diligence or independent verification of any information it receives and/or relies on in its reports. CRISIL Ratings
has established policies and procedures to maintain the confidentiality of certain non-public information
received in connection with each analytical process. CRISIL Ratings has in place a ratings code of conduct and
policies for managing conflict of interest. For details please refer to: https://www.crisil.com/en/home/our-
businesses/ratings/regulatory-disclosures/highlighted-policies.html.

Please note: This advisory should not be construed as a rating reaffirmation.

Rating criteria by CRISIL Ratings are generally available without charge to the public on the CRISIL Ratings public
website, www.crisilratings.com. For latest rating information on any instrument of any company rated by CRISIL
Ratings, you may contact the CRISIL Ratings desk at [email protected], or at (0091) 1800 267 1301.

This report should not be reproduced or redistributed to any other person or in any form without prior written
consent from CRISIL Ratings.

All rights reserved @ CRISIL Ratings Limited. CRISIL Ratings is a wholly owned subsidiary of CRISIL Limited.

CRISIL Ratings uses the prefix 'PP-MLD' for the ratings of principal-protected market-linked debentures (PPMLD)
with effect from November 1, 2011, to comply with the SEBI circular, "Guidelines for Issue and Listing of Structured
Products/Market Linked Debentures". The revision in rating symbols for PPMLDs should not be construed as a
change in the rating of the subject instrument. For details on CRISIL Ratings' use of 'PP-MLD' please refer to the
notes to Rating scale for Debt Instruments and Structured Finance Instruments at the following
link: https://www.crisil.com/en/home/our-businesses/ratings/credit-ratings-scale.html

Please note: This advisory should not be construed as a rating reaffirmation.

 Rating Rationale
August 30, 2022 | Mumbai

D.P.M.K. Fertilizers Private Limited

Ratings reaffirmed at 'CRISIL BB- / Stable / CRISIL A4+ '

Rating Action
Total Bank Loan Facilities Rated Rs.18 Crore
Long Term Rating CRISIL BB-/Stable (Reaffirmed)
Short Term Rating CRISIL A4+ (Reaffirmed)
Note: None of the Directors on CRISIL Ratings Limited’s Board are members of rating committee and thus do not participate in discussion or assignment of any
ratings. The Board of Directors also does not discuss any ratings at its meetings.
1 crore = 10 million
Refer to Annexure for Details of Instruments & Bank Facilities

Detailed Rationale
CRISIL Ratings has reaffirmed its ‘CRISIL BB-/Stable/CRISIL A4+' ratings on the bank facilities of DPMK Fertilizers Pvt Ltd
(DPMK).

The ratings continue to reflect the extensive experience of the promoters in the fertilizer industry. These strengths are
partially offset by average scale of operations and low operating margins, average financial risk profile and large working
capital requirement
Key Rating Drivers & Detailed Description
Strengths:
Extensive experience of the promoters
Benefits from the promoters' experience of over 25 years and the healthy relationship with clients and suppliers in
Chhattisgarh, Madhya Pradesh and Odisha should continue to support the business.

Weaknesses:
Average scale of operations and a low operating margin:
Revenues was modest at Rs 143 crore with a low operating margin at around 3% in fiscal 2022. Intense competition,
high volatility in prices and the trading nature of operations constrain the business. A profitable scale-up in operations
will remain a key rating sensitivity factor.

Moderate financial risk profile:

The capital structure was marked by high gearing and total outside liabilities to adjusted networth of 2.21 times and 3.66
times, respectively, as on March 31, 2022, due to modest networth of Rs 11.77 crore. Debt protection metrics were
average, as reflected in interest coverage and net cash accrual to adjusted debt ratios of 2.13 times and 0.09 time,
respectively, for fiscal 2022. The financial risk profile is likely to be maintained over the medium term, owing to high
working capital requirement and low accruals.
Liquidity: Stretched
Bank limit utilization is moderately high utilized at around 93.5% during the 12 months through March 2022. Cash accrual is
estimated to be around Rs 1.6 crore, against term debt obligation of Rs 0.9 crore, per fiscal over the medium term. The
excess will cushion liquidity. The current ratio was moderate at 1.36 times as on March 31, 2022
Outlook- Stable
DPMK should continue to benefit from the extensive experience of the promoters.
Rating Sensitivity factors
Upward factors
Sustained improvement in revenue of 30%, resulting in higher cash accrual
Improvement in TOLANW ratio below 1.5 times
 Downward Factors
Any debt funded capex constraining financial flexibility
A decline in the interest coverage ratio to below 1.5times
About the Company
DPMK was established as a proprietorship firm in 1990 and reconstituted as a private limited company with the current
name in 2009. Mrs Dwarika Gupta manages operations. The company is a distributor of organic and inorganic fertiliser in
Chhattisgarh, Madhya Pradesh, and Odisha
Key Financial Indicators
As on / for the period ended March 31 2021 2020
Operating income Rs crore 192.42 147.43
Reported profit after tax Rs crore 2.07 1.54
PAT margins % 1.08 1.05
Adjusted Debt/Adjusted Net worth Times 2.21 2.05
Interest coverage Times 2.08 2.14
Any other information: Not applicable

Note on complexity levels of the rated instrument:

CRISIL Ratings` complexity levels are assigned to various types of financial instruments and are included (where
applicable) in the 'Annexure - Details of Instrument' in this Rating Rationale.

CRISIL Ratings will disclose complexity level for all securities - including those that are yet to be placed - based on
available information. The complexity level for instruments may be updated, where required, in the rating rationale
published subsequent to the issuance of the instrument when details on such features are available.

For more details on the CRISIL Ratings` complexity levels please visit www.crisilratings.com. Users may also call the
Customer Service Helpdesk with queries on specific instruments.

Annexure - Details of Instrument(s)

Name of Date of Coupon Maturity Issue size Complexity Rating assigned
ISIN
instrument allotment rate (%) date (Rs crore) level with outlook
NA Cash Credit NA NA NA 17.5 NA CRISIL BB-/Stable
NA Bank Guarantee NA NA NA 0.5 NA CRISIL A4+

Annexure - Rating History for last 3 Years

Start of
Current 2022 (History) 2021 2020 2019
2019
Outstanding
Instrument Type Rating Date Rating Date Rating Date Rating Date Rating Rating
Amount
Fund Based LT 17.5 CRISIL -- 23-06-21 CRISIL 03-03-20 CRISIL 10-07-19 CRISIL CRISIL
Facilities BB-/Stable BB-/Stable BB-/Stable BB-/Stable B+/Stable

-- -- -- -- 14-06-19 CRISIL --
BB-/Stable
Non-Fund ST 0.5 CRISIL -- 23-06-21 CRISIL 03-03-20 CRISIL 10-07-19 CRISIL CRISIL
Based Facilities A4+ A4+ A4+ A4+ A4

-- -- -- -- 14-06-19 CRISIL --
A4+
All amounts are in Rs.Cr.

Annexure - Details of Bank Lenders & Facilities

Facility Amount (Rs.Crore) Name of Lender Rating
Cash Credit 17.5 Allahabad Bank CRISIL BB-/Stable
Bank Guarantee 0.5 Allahabad Bank CRISIL A4+

This Annexure has been updated on 23-Mar-23 in line with the lender-wise facility details as on 10-Mar-23 received from the rated entity.

Criteria Details

Links to related criteria

CRISILs Approach to Financial Ratios
Rating criteria for manufaturing and service sector companies
CRISILs Bank Loan Ratings - process, scale and default recognition
Rating Criteria for Retailing Industry
CRISILs Approach to Recognising Default

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Note for Media:
This rating rationale is transmitted to you for the sole purpose of dissemination through your newspaper/magazine/agency. The rating rationale may be
used by you in full or in part without changing the meaning or context thereof but with due credit to CRISIL Ratings. However, CRISIL Ratings alone has
the sole right of distribution (whether directly or indirectly) of its rationales for consideration or otherwise through any media including websites and portals.

About CRISIL Ratings Limited (A subsidiary of CRISIL Limited, an S&P Global Company)

CRISIL Ratings pioneered the concept of credit rating in India in 1987. With a tradition of independence, analytical rigour and
innovation, we set the standards in the credit rating business. We rate the entire range of debt instruments, such as bank loans,
certificates of deposit, commercial paper, non-convertible/convertible/partially convertible bonds and debentures, perpetual
bonds, bank hybrid capital instruments, asset-backed and mortgage-backed securities, partial guarantees and other structured
debt instruments. We have rated over 33,000 large and mid-scale corporates and financial institutions. We have also instituted
several innovations in India in the rating business, including ratings for municipal bonds, partially guaranteed instruments and
infrastructure investment trusts (InvITs).

CRISIL Ratings Limited ('CRISIL Ratings') is a wholly-owned subsidiary of CRISIL Limited ('CRISIL'). CRISIL Ratings Limited is
registered in India as a credit rating agency with the Securities and Exchange Board of India ("SEBI").

For more information, visit www.crisilratings.com

About CRISIL Limited

CRISIL is a leading, agile and innovative global analytics company driven by its mission of making markets function better.

It is India’s foremost provider of ratings, data, research, analytics and solutions with a strong track record of growth, culture of
innovation, and global footprint.

It has delivered independent opinions, actionable insights, and efficient solutions to over 100,000 customers through businesses
that operate from India, the US, the UK, Argentina, Poland, China, Hong Kong and Singapore.

It is majority owned by S&P Global Inc, a leading provider of transparent and independent ratings, benchmarks, analytics and
data to the capital and commodity markets worldwide.

For more information, visit www.crisil.com

Connect with us: TWITTER | LINKEDIN | YOUTUBE | FACEBOOK

CRISIL PRIVACY NOTICE

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account and to provide you with additional information from CRISIL. For further information on CRISIL's privacy policy please visit www.crisil.com.

DISCLAIMER

This disclaimer is part of and applies to each credit ra ng report and/or credit ra ng ra onale ('report') that is provided by
CRISIL Ra ngs Limited ('CRISIL Ra ngs'). To avoid doubt, the term 'report' includes the informa on, ra ngs and other content
forming part of the report. The report is intended for the jurisdic on of India only. This report does not cons tute an offer of
services. Without limi ng the generality of the foregoing, nothing in the report is to be construed as CRISIL Ra ngs providing
or intending to provide any services in jurisdic ons where CRISIL Ra ngs does not have the necessary licenses and/or
registra on to carry out its business ac vi es referred to above. Access or use of this report does not create a client
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sell or an offer to purchase or subscribe for any investment in any securi es, instruments, facili es or solicita on of any kind to
enter into any deal or transac on with the en ty to which the report pertains. The report should not be the sole or primary
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Ra ngs may disseminate its opinions and analysis. The ra ng contained in the report is not a subs tute for the skill, judgment
and experience of the user, its management, employees, advisors and/or clients when making investment or other business
decisions. The recipients of the report should rely on their own judgment and take their own professional advice before ac ng
on the report in any way. CRISIL Ra ngs or its associates may have other commercial transac ons with the en ty to which the
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any informa on it receives and/or relies on in its reports. CRISIL Ra ngs has established policies and procedures to maintain
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place a ra ngs code of conduct and policies for managing conflict of interest. For details please refer to:
h ps://www.crisil.com/en/home/our-businesses/ra ngs/regulatory-disclosures/highlighted-policies.html.

Ra ng criteria by CRISIL Ra ngs are generally available without charge to the public on the CRISIL Ra ngs public website,
www.crisilra ngs.com. For latest ra ng informa on on any instrument of any company rated by CRISIL Ra ngs, you may
contact the CRISIL Ra ngs desk at crisilra [email protected], or at (0091) 1800 267 1301.

This report should not be reproduced or redistributed to any other person or in any form without prior wri en consent from
CRISIL Ra ngs.

All rights reserved @ CRISIL Ra ngs Limited. CRISIL Ra ngs is a wholly owned subsidiary of CRISIL Limited.

CRISIL Ratings uses the prefix 'PP-MLD' for the ratings of principal-protected market-linked debentures (PPMLD) with effect
from November 1, 2011, to comply with the SEBI circular, "Guidelines for Issue and Listing of Structured Products/Market Linked
Debentures". The revision in rating symbols for PPMLDs should not be construed as a change in the rating of the subject
instrument. For details on CRISIL Ratings' use of 'PP-MLD' please refer to the notes to Rating scale for Debt Instruments and
Structured Finance Instruments at the following link: h ps://www.crisil.com/en/home/our-businesses/ra ngs/credit-ra ngs-scale.html