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CRISIL has assigned its ‘BB-/Stable’ rating to the long-term loan facility of R. A. Associates (RAA). The rating reflects RAA’s implementation risks associated with its commercial cum residential project in Dadar (Mumbai) and geographical concentration as regards the projects of KB Kothari Group. These weaknesses are partially offset by the experience of RAA’s promoters in the real estate business.
Outlook: Stable
CRISIL expects RAA to benefit over the medium term from its promoters’ longstanding experience in the construction business. The outlook may be revised to ‘Positive’ in case of a significant improvement in its business and financial risk profiles, on account of better than expected revenue generation from the project. Conversely, the outlook may be revised to ‘Negative’ in case sales of the firm’s project is lower than expected, or in case of delays in project implementation or a prolonged slowdown in the real estate market, affecting realisations.
About the Company
RAA, set up in 2006, is a partnership firm formed as a special purpose vehicle for a commercial cum residential real estate project in Dadar. The concern is part of the KB Kothari group (KBK group). Mr. Vinay Kothari, Mr. Rajendra Kothari and Mr. Ashok Kothari, Mr.Vivek Kothari and Mr. Varun Kothari are partners in the firm. One of their close associates, Mr. Chandraprakash D. Siroya along with his firm, M/s Siroya Infrastructure Pvt. Ltd., holds 35% share in the firm.
The firm has acquired around 12,751 square metres of land in Dadar. The construction and development activity began in 2010-11 (refers to financial year, April 1 to March 31), and the project is expected to be completed by 2013-14.
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CRISIL Rating Desk
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Mitu Samar
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Tanuja Abhinandan
Market Development & Communications
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Gurpreet S Chhatwal
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Vinayak Nayak
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