Rating Rationale
December 29, 2018 | Mumbai
Alphageo (India) Limited
Rated amount enhanced
Rating Action
Total Bank Loan Facilities Rated Rs.124.8 Crore (Enhanced from Rs.109 Crore)
Long Term Rating CRISIL BBB+/Stable (Reaffirmed)
Short Term Rating CRISIL A2 (Reaffirmed)
1 crore = 10 million
Refer to annexure for Details of Instruments & Bank Facilities
Detailed Rationale

CRISIL has reaffirmed its 'CRISIL BBB+/Stable/CRISIL A2' ratings on the bank facilities of Alphageo (India) Limited (AGIL; part of the Alphageo group).
The ratings continue to reflect the extensive experience of the group's promoters, and its established position in the onshore seismic survey services industry, the moderate revenue visibility, and healthy financial risk profile. These rating strengths are partially offset by seasonality in operations, volatility in cash flows, and susceptibility to risks relating to the tender-driven businesses, and unfavourable government policies.

Analytical Approach

For arriving at the ratings, CRISIL has considered the consolidated financials of AGIL and its wholly-owned subsidiaries, Alphageo International Ltd (Dubai) and Alphageo DMCC (Dubai), and 74% subsidiary, Alphageo Marine Services Pvt Ltd.

Key Rating Drivers & Detailed Description
* Established market position in the onshore seismic survey services and extensive experience of the promoters: AGIL is the largest onshore seismic survey services provider, for oil exploration and production companies in India, with a long track record of almost three decades of operations. The strong execution capabilities, and latest technology, have ensured a constant inflow of orders. Healthy relationships with key clients such as Oil and Natural Gas Corporation (ONGC) and Oil India Ltd (OIL) will also support the business risk profile.
* Moderate revenue visibility:  Orders worth Rs 827 crore as on March 31, 2018, provide revenue visibility for the medium term.

* Healthy financial risk profile: Financial risk profile was marked by a healthy networth of Rs 229.6 crore as on March 31, 2018, while gearing and total outside liabilities to tangible networth ratios were comfortable at 0.2 time and 0.58 time, respectively. Debt protection metrics are robust: interest coverage and net cash accrual to total debt ratios stood at 22 times and 1.83 times, respectively, in fiscal 2018.
* Seasonal nature of operations, leading to volatility in cash flows: The pace of seismic data acquisition slows down during the monsoon, as weather conditions impede the movement of men, material, and equipment, and quality of data acquired. Hence, given these constraints, bulk of revenue is achieved in the first and last quarters of every financial year, though the third quarter sees execution in small proportions. Such seasonality in operations leads to volatility in cash flows.
* Susceptibility to tender based operations and government policies: Despite moderate revenue visibility for the next two years, incremental revenue growth will remain dependent on the ability to win orders, and on government policies and investment decisions. Any policy changes or lower spending on exploration and production (probably due to lower crude prices), can significantly impact revenue and profitability.
Outlook: Stable

CRISIL believes the Alphageo group will continue to benefit from its moderate order pipeline and strong project execution capabilities. The outlook may be revised to 'Positive' if healthy inflow of orders and their timely execution considerably strengthen key credit metrics. The outlook may be revised to Negative if delays in order execution, significant stretch in receivables, or any large capital expenditure or support extended to affiliates, weakens the financial risk profile, especially liquidity.

AGIL has ample liquidity marked by healthy net cash accrual against negligible term debt obligations, healthy unencumbered cash and bank balances and cushion available in bank limits. Net cash accrual of Rs 85-95 crore each is likely to be reported in fiscals 2019 and 2020, against negligible term debt.  Bank limit utilisation averaged 62% over the 12 months through August 2018. Moreover unencumbered cash & bank balances of over Rs 80 crore as of September, 2018 supports liquidity.

About the Company

AGIL was incorporated in 1987, by Mr Dinesh Alla and his family. The company provides seismic-data acquisition and processing services to oil and gas exploration companies. The Hyderabad-based company is listed on the Bombay Stock Exchange and National Stock Exchange of India Ltd. Alphageo International Ltd and Alphageo DMCC, are based in Dubai and also undertake seismic survey activities.
Alphageo Marine Services Pvt Ltd was incorporated in October 2017, to undertake marine or aerial geophysical survey services. However there are no operations undertaken by the company currently.
For the six months ended September 30, 2018 profit after tax (PAT) was Rs 9.94 crore on revenue of Rs 137.56 crore, as against Rs 12.09 crore and Rs 136.2 crore, respectively, reported for the corresponding period of the previous fiscal.

Key Financial Indicators
Particulars Unit 2018 2017
Revenue Rs crore 429.4 305.9
Profit After Tax (PAT) Rs crore 54.5 50.6
PAT Margin % 12.7 16.5
Adjusted Debt/Adjusted Networth Times 0.2 0.29
Interest coverage Times 22 24.9

Any other information: Not applicable

Note on complexity levels of the rated instrument:
CRISIL complexity levels are assigned to various types of financial instruments. The CRISIL complexity levels are available on www.crisil.com/complexity-levels. Users are advised to refer to the CRISIL complexity levels for instruments that they consider for investment. Users may also call the Customer Service Helpdesk with queries on specific instruments.
Annexure - Details of Instrument(s)
ISIN Name of Instrument Date of Allotment Coupon
Rate (%)
Maturity Date Issue
(Rs Cr)
Assigned with
NA Bank Guarantee NA NA NA 84.8 CRISIL A2
NA Cash Credit NA NA NA 40 CRISIL BBB+/Stable
Annexure - Rating History for last 3 Years
  Current 2018 (History) 2017  2016  2015  Start of 2015
Instrument Type Outstanding Amount Rating Date Rating Date Rating Date Rating Date Rating Rating
Fund-based Bank Facilities  LT/ST  40.00  CRISIL BBB+/Stable  28-09-18  CRISIL BBB+/Stable  12-09-17  CRISIL BBB/Positive  04-08-16  CRISIL BBB-/Positive  25-11-15  CRISIL BBB-/Stable  CRISIL BB+/Stable 
            13-01-17  CRISIL BBB-/Positive      18-11-15  CRISIL BBB-/Stable   
                    16-11-15  CRISIL BBB-/Stable   
Non Fund-based Bank Facilities  LT/ST  84.80  CRISIL A2  28-09-18  CRISIL A2  12-09-17  CRISIL A3+  04-08-16  CRISIL A3  25-11-15  CRISIL A3  CRISIL A4+ 
            13-01-17  CRISIL A3      18-11-15  CRISIL A3   
                    16-11-15  CRISIL A3   
All amounts are in Rs.Cr.
Annexure - Details of various bank facilities
Current facilities Previous facilities
Facility Amount (Rs.Crore) Rating Facility Amount (Rs.Crore) Rating
Bank Guarantee 84.8 CRISIL A2 Bank Guarantee 69 CRISIL A2
Cash Credit 40 CRISIL BBB+/Stable Cash Credit 40 CRISIL BBB+/Stable
Total 124.8 -- Total 109 --
Links to related criteria
CRISILs Approach to Financial Ratios
CRISILs Bank Loan Ratings - process, scale and default recognition
Rating criteria for manufaturing and service sector companies
Rating Criteria for Upstream Oil and Gas Sector
CRISILs Criteria for rating short term debt

For further information contact:
Media Relations
Analytical Contacts
Customer Service Helpdesk
Saman Khan
Media Relations
CRISIL Limited
D: +91 22 3342 3895
B: +91 22 3342 3000

Naireen Ahmed
Media Relations
CRISIL Limited
D: +91 22 3342 1818
B: +91 22 3342 3000

Vinay Rajani
Media Relations
CRISIL Limited
D: +91 22 3342 1835
M: +91 91 676 42913
B: +91 22 3342 3000

Rahul Guha
Director - CRISIL Ratings
CRISIL Limited
D:+91 22 4097 8320

Nagarjun Alaparthi
Rating Analyst - CRISIL Ratings
CRISIL Limited
D:+91 40 4032 8210

Timings: 10.00 am to 7.00 pm
Toll free Number:1800 267 1301

For a copy of Rationales / Rating Reports:
For Analytical queries:


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. However, CRISIL alone has the sole right of distribution (whether directly or indirectly) of its rationales for consideration or otherwise through any media including websites, portals etc.

About CRISIL Limited

CRISIL is a leading agile and innovative, global analytics company driven by its mission of making markets function better. We are India’s foremost provider of ratings, data, research, analytics and solutions. A strong track record of growth, culture of innovation and global footprint sets us apart. We have delivered independent opinions, actionable insights, and efficient solutions to over 1,00,000 customers.
We are 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 


About CRISIL Ratings
CRISIL Ratings is part of CRISIL Limited (“CRISIL”). We pioneered the concept of credit rating in India in 1987. CRISIL is registered in India as a credit rating agency with the Securities and Exchange Board of India (“SEBI”). With a tradition of independence, analytical rigour and innovation, CRISIL sets 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 24,500 large and mid-scale corporates and financial institutions. CRISIL has also instituted several innovations in India in the rating business, including rating municipal bonds, partially guaranteed instruments and microfinance institutions. We also pioneered a globally unique rating service for Micro, Small and Medium Enterprises (MSMEs) and significantly extended the accessibility to rating services to a wider market. Over 1,10,000 MSMEs have been rated by us.

CRISIL respects your privacy. We may use your contact information, such as your name, address, and email id to fulfil your request and service your account and to provide you with additional information from CRISIL.For further information on CRISIL’s privacy policy please visit www.crisil.com.


This disclaimer forms part of and applies to each credit rating report and/or credit rating rationale that we provide (each a “Report”). For the avoidance of 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 providing or intending to provide any services in jurisdictions where CRISIL does not have the necessary licenses and/or registration to carry out its business activities referred to above. Access or use of this Report does not create a client relationship between CRISIL and the user.

We are not aware that any user intends to rely on the Report or of the manner in which a user intends to use the Report. In preparing our Report we have not taken into consideration the objectives or particular needs of any particular user. It is made abundantly clear that the Report is not intended to and does not constitute an investment advice. The Report is not an offer to sell or an offer to purchase or subscribe for any investment in any securities, instruments, facilities or solicitation of any kind or otherwise enter into any deal or transaction with the entity to which the Report pertains. The Report should not be the sole or primary basis for any investment decision within the meaning of any law or regulation (including the laws and regulations applicable in the US).

Ratings from CRISIL Rating are statements of opinion as of the date they are expressed and not statements of fact or recommendations to purchase, hold, or sell any securities / instruments or to make any investment decisions. Any opinions expressed here are in good faith, are subject to change without notice, and are only current as of the stated date of their issue. CRISIL assumes no obligation to update its opinions following publication in any form or format although CRISIL may disseminate its opinions and analysis. CRISIL 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 any way.CRISIL or its associates may have other commercial transactions with the company/entity.

Neither CRISIL nor its affiliates, third party providers, as well as their directors, officers, shareholders, employees or agents (collectively, “CRISIL Parties”) guarantee the accuracy, completeness or adequacy of the Report, and no CRISIL Party shall have any liability for any errors, omissions, or interruptions therein, regardless of the cause, or for the results obtained from the use of any part of the Report. EACH CRISIL PARTY DISCLAIMS ANY AND ALL EXPRESS OR IMPLIED WARRANTIES, INCLUDING, BUT NOT LIMITED TO, ANY WARRANTIES OF MERCHANTABILITY, SUITABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR USE. In no event shall any CRISIL Party be liable to any party for any direct, indirect, incidental, exemplary, compensatory, punitive, special or consequential damages, costs, expenses, legal fees, or losses (including, without limitation, lost income or lost profits and opportunity costs) in connection with any use of any part of the Report even if advised of the possibility of such damages.

CRISIL Ratings may receive compensation for its ratings and certain credit-related analyses, normally from issuers or underwriters of the instruments, facilities, securities or from obligors. CRISIL’s public ratings and analysis 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 web sites, www.crisil.com (free of charge). Reports with more detail and additional information may be available for subscription at a fee – more details about CRISIL ratings are available here: www.crisilratings.com.

CRISIL and its affiliates do not act as a fiduciary. While CRISIL has obtained information from sources it believes to be reliable, CRISIL does not perform an audit and undertakes no duty of due diligence or independent verification of any information it receives and / or relies in its Reports. CRISIL keeps certain activities of its business units separate from each other in order to preserve the independence and objectivity of the respective activity. As a result, certain business units of CRISIL may have information that is not available to other CRISIL business units. CRISIL has established policies and procedures to maintain the confidentiality of certain non-public information received in connection with each analytical process. CRISIL has in place a ratings code of conduct and policies for analytical firewalls and for managing conflict of interest. For details please refer to: https://www.crisil.com/en/home/our-businesses/ratings/regulatory-disclosures/highlighted-policies.html

CRISIL’s rating criteria are generally available without charge to the public on the CRISIL public web site, www.crisil.com. For latest rating information on any instrument of any company rated by CRISIL you may contact CRISIL RATING DESK at CRISILratingdesk@crisil.com, or at (0091) 1800 267 1301.

This Report should not be reproduced or redistributed to any other person or in any form without a prior written consent of CRISIL.

All rights reserved @ CRISIL