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CARE reaffirms ‘CARE A’ rating assigned to the NCD issue of Binani Cement

26 May 2011 Evaluate

Credit rating agency, CARE has reaffirmed the ratings ‘CARE A’ assigned to the non-convertible debentures (NCD) issue of Binani Cement (BCL) for Rs 30.00 crore.

The rating is strengthened by BCL’s well-established position in its key markets, experienced management, improvement in operating and financial performance during FY10, operating efficiencies enjoyed by the company on account of good quality limestone reserves, close proximity of limestone reserves with manufacturing plant and captive power generation.

Ability of company to protect margins and cash flows in a scenario of possible overcapacity in the key markets and weakening of the capital structure on further debt-funded expansions are the key rating sensitivities.

The company has reported a jump of 244% at Rs 58.15 crore in its net profit for the quarter ended March 31, 2011 against Rs 16.89 crore for the quarter ended March 31, 2010. The net sales / income from operations of the company stood at Rs 545.37 crore for the quarter ended March 31, 2011 against Rs 491.84 crore for the quarter ended March 31, 2010.

For the year ended March 31, 2011, the company’s net profit declined by 94% at Rs 17.50 crore against Rs 292.54 crore for the year ended March 31, 2010. The company has reported net sales / income from operations of Rs 1884.30 crore for the year ended March 31, 2011 against Rs 2259.78 crore for the year ended March 31, 2010.

Binani Cement is a flagship company of Braj Binani Group engaged in the manufacturing of cement. It also operates businesses in areas of zinc, glass fibre and composites.

Peers
Company Name CMP
Ultratech Cement 11499.90
Ambuja Cement 441.05
ACC 1409.50
Shree Cement 24303.35
Dalmia Bharat 1947.95
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