Rating Rationale
January 31, 2018 | Mumbai
Modern Steels Limited
Issuer not cooperating, based on best-available information; Ratings migrated to CRISIL D/CRISIL D Issuer not cooperating'
 
Rating Action
Total Bank Loan Facilities Rated Rs.215.48 Crore
Long Term Rating CRISIL D (Issuer Not Cooperating; Rating Migrated)*
Short Term Rating CRISIL D (Issuer Not Cooperating; Rating Migrated)*
1 crore = 10 million
Refer to annexure for Details of Instruments & Bank Facilities
*Issuer did not cooperate; based on best-available information
Please note that the rating(s) are based on best available information with the credit rating agency: the entity whose debt is being published via this press release did not provide the requisite information needed to conduct the rating exercise and is therefore classified as 'non cooperative'.
Non cooperation by Issuer

CRISIL has been consistently following up with Modern Steels Limited (MSL) for obtaining information through letters dated November 30, 2017, and January 19, 2018. However, the issuer has remained non-cooperative.

Investors, lenders, and all other market participants should exercise due caution while using ratings assigned/reviewed with the suffix 'ISSUER NOT COOPERATING'. These ratings lack a forward-looking component as they are arrived at without any management interaction and are based on best available or limited or dated information on the company.

Detailed Rationale

Despite repeated attempts to engage with the management, CRISIL failed to receive any information on either the financial performance or strategic intent of MSL. This restricts CRISIL's ability to take a forward-looking view on the credit quality of the entity. CRISIL believes that the information available for the company is consistent with 'Scenario 2' outlined in the 'Framework for Assessing Consistency of Information with CRISIL BBB category or lower.'

Furthermore, the company has not paid the fee for conducting rating surveillance as agreed to in the rating agreement. Based on the last available information, CRISIL has migrated the rating to 'CRISIL D/CRISIL D (Issuer Not Co-operating)'.

About the Company

MSL was set up in 1974 by Mr Amarjit Goyal. It is listed on the Bombay Stock Exchange, and is managed by Mr Krishan Kumar Goyal, son of Mr Amarjit Goyal. MSL manufactures low-alloy and carbon-steel-rolled products for commercial vehicles, such as trucks and tractors, passenger vehicles, two-wheelers, and engineering companies.

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 size
(Rs crore)
Rating assigned with outlook
NA Cash Credit NA NA NA 73.0 CRISIL D/Issuer Not Cooperating
NA Funded Interest Term Loan NA NA Apr - 2021 10.2 CRISIL D/Issuer Not Cooperating
NA Letter of Credit NA NA NA 51.5 CRISIL D/Issuer Not Cooperating
NA Term Loan NA NA Apr - 2021 41.88 CRISIL D/Issuer Not Cooperating
NA Working Capital Term Loan NA NA Apr - 2021 38.9 CRISIL D/Issuer Not Cooperating
Annexure - Rating History for last 3 Years
  Current 2018 (History) 2017  2016  2015  Start of 2015
Instrument Type Quantum Rating Date Rating Date Rating Date Rating Date Rating Rating
Fund-based Bank Facilities  LT/ST  163.98  CRISIL D (Issuer Not Cooperating)*    No Rating Change    No Rating Change    No Rating Change  19-08-15  CRISIL D  CRISIL B/Stable 
Non Fund-based Bank Facilities  LT/ST  51.5  CRISIL D (Issuer Not Cooperating)*    No Rating Change    No Rating Change    No Rating Change  19-08-15  CRISIL D  CRISIL A4 
Table reflects instances where rating is changed or freshly assigned. 'No Rating Change' implies that there was no rating change under the release.
*Issuer did not cooperate; based on best-available information
Annexure - Details of various bank facilities
Current facilities Previous facilities
Facility Amount (Rs.Crore) Rating Facility Amount (Rs.Crore) Rating
Cash Credit 73 CRISIL D/Issuer Not Cooperating Cash Credit 73 CRISIL D
Funded Interest Term Loan 10.2 CRISIL D/Issuer Not Cooperating Funded Interest Term Loan 10.2 CRISIL D
Letter of Credit 51.5 CRISIL D/Issuer Not Cooperating Letter of Credit 51.5 CRISIL D
Term Loan 41.88 CRISIL D/Issuer Not Cooperating Term Loan 41.88 CRISIL D
Working Capital Term Loan 38.9 CRISIL D/Issuer Not Cooperating Working Capital Term Loan 38.9 CRISIL D
Total 215.48 -- Total 215.48 --
Links to related criteria
CRISILs Approach to Financial Ratios
CRISILs Bank Loan Ratings - process, scale and default recognition
Framework for Assessing Information Adequacy Risk
Rating criteria for manufaturing and service sector companies
Rating Criteria for Commercial Vehicle Industry
Rating Criteria for Steel Industry
CRISILs Approach to Recognising Default
CRISILs Criteria for rating short term debt

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