CRISIL has assigned its ratings of ‘B-/Stable/P4’ to the various bank facilities of Sunshield Chemicals Ltd (Sunshield). The ratings reflect Sunshield’s weak financial risk profile and small scale of operations. These rating weaknesses are, however, mitigated by the benefits that Sunshield derives from the vast experience of its promoters.

Outlook: Stable
CRISIL expects Sunshield’s financial risk profile to remain constrained on account of low profitability and weak liquidity profile. The outlook may be revised to ‘Positive’ if the company’s capital structure improves significantly, backed by higher-than-expected internal accruals. Conversely, the outlook may be revised to ‘Negative’ if unfavourable business conditions further weaken the company’s financial risk profile, and impact its debt-servicing ability.

About the Company
Sunshield was incorporated by Mr. Satish Kelkar in 1986 as a private limited company. In 1995, the company was listed on Bombay Stock Exchange (BSE), following an initial public offering. During 2004-05 (refers to financial year, April 1 to March 31), Mr. Amit Choksey acquired a controlling stake in Sunshield. The company manufactures organic chemicals such as tri hydroxy ethyl isocyanurate (THEIC), ethylene oxide condensate (EOC), antioxidants and other specialty chemicals at its plant at Raigad (Maharashtra). These organic chemicals find application in industries such as rubber, plastic, polymers, lubes/oil, and wire enamel.

Sunshield reported a net loss of Rs.5.4 million on revenues of Rs.461.1 million for 2007-08, as against a net loss of Rs.32.8 million on revenues of Rs.373.1 million for 2006-07.