July 13, 2012
Gandhi Special Tubes Limited
|Total Bank Loan Facilities Rated||Rs.95 Million|
(Refer to Annexure 1 for Facility-wise details)
CRISIL has suspended its ratings on the bank facilities of Gandhi Special Tubes Limited (GSTL). The suspension of ratings is on account of non-cooperation by GSTL with CRISIL's efforts to undertake a review of the ratings outstanding. Despite repeated requests by CRISIL, GSTL is yet to provide adequate information to enable CRISIL to assess GSTL ’s ability to service its debt. The suspension reflects CRISIL's inability to maintain a valid rating in the absence of adequate information. CRISIL views information availability risk as a key credit factor in its rating process and views non-sharing of information as a first signal of possible credit distress, as outlined in its criteria “Information availability risk in Credit ratings".
About the Company
GSTL was originally incorporated in 1985 by Mr Manhar Gandhi and his brother, Mr Bhupatrai Gandhi, as Gandhi Special O7 Tubes Ltd; the company was renamed in 1994. GSTL manufactures precision-welded and seamless steel tubes of small diameters. The company is one of the largest players in the business and caters to original equipment manufacturers as well as their vendors in the refrigeration, automotive, and general engineering industries. It has capacities of 24 million metres per annum (mmpa) and 16 mmpa for welded and seamless tubes, respectively, at its plant at Halol (Gujarat). The company also manufactures cold-formed nuts, which serve as complementary products to the tubes business. GSTL also has a wind power capacity of 5.35 megawatts.
Annexure 1 - Details of various bank facilities
|Current facilities||Previous facilities|
|Letter of credit & Bank Guarantee||70||Suspended||Letter of credit & Bank Guarantee||70||CRISIL A1+|
|Cash Credit||25||Suspended||Cash Credit||25||CRISIL A+/Stable|
|Media Contacts||Analytical Contacts||CRISIL Rating Desk|
Director, Communications and Brand Management
Tel: +91-22- 3342 1838
Communications and Brand Management
Tel: +91-22- 3342 1818
|Subodh K Rai|
Senior Director - CRISIL Ratings
Tel: +91-0124-672 2000
|Tel: +91-22-3342 3047/3342 3064|
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 of its rationales for consideration or otherwise through any media including websites, portals etc.
Crisil complexity levels are assigned to various types of financial instruments. The crisil complexity levels are available on www.crisil.com/complexity-levels.investors are advised to refer to the crisil complexity levels for instruments that they desire to invest in. Investors may also call the crisil helpline at +91 22 3342 3047 / + 91 22 3342 3064 with queries on specific instruments.
About CRISIL LIMITED
CRISIL is a global analytical company providing ratings, research, and risk and policy advisory services. We are India's leading ratings agency. We are also the foremost provider of high-end research to the world's largest banks and leading corporations.
CRISIL PRIVACY NOTICE
CRISIL respects your privacy. We use your contact information, such as your name, address, and email id, to fulfill your request and service your account and to provide you with additional information from CRISIL and other parts of The McGraw-Hill Companies, Inc. you may find of interest.
Last updated: April 30, 2012
Disclaimer: A CRISIL rating reflects CRISIL's current opinion on the likelihood of timely payment of the obligations under the rated instrument and does not constitute an audit of the rated entity by CRISIL. CRISIL ratings are based on information provided by the issuer or obtained by CRISIL from sources it considers reliable. CRISIL does not guarantee the completeness or accuracy of the information on which the rating is based. A CRISIL rating is not a recommendation to buy, sell, or hold the rated instrument; it does not comment on the market price or suitability for a particular investor. All CRISIL ratings are under surveillance. Ratings are revised as and when circumstances so warrant. CRISIL is not responsible for any errors and especially states that it has no financial liability whatsoever to the subscribers / users / transmitters / distributors of this product. CRISIL Ratings rating criteria are available without charge to the public on the CRISIL web site, www.crisil.com. For the latest rating information on any instrument of any company rated by CRISIL, please contact CRISIL RATING DESK at CRISILratingdesk@crisil.com, or at (+91 22) 3342 3000.
July 13, 2012