| Nambiar Ensembleresidential Projects LLP | ||||
| 'Crisil BBB+/Stable' assigned to Bank Debt | ||||
| Rating Action | ||||
| ||||
| Note: None of the Directors on Crisil Ratings Limited’s Board are members of rating committee and thus do not participate in discussion or assignment of any ratings. The Board of Directors also does not discuss any ratings at its meetings. | ||||
| 1 crore = 10 million | ||||
| Refer to Annexure for Details of Instruments & Bank Facilities |
Detailed Rationale Crisil Ratings has assigned its ‘Crisil BBB+/Stable’ rating to the long-term bank facilities of Nambiar Ensembleresidential Projects LLP (NEPLLP; part of the Nambiar group).
The rating reflects the extensive experience of the promoters in the real estate industry, healthy booking progress for the group’s projects and its strong debt to asset ratio. These strengths are partially offset by exposure to project implementation risks and susceptibility to cyclicality inherent in the real estate sector |
Analytical Approach For arriving at the ratings, Crisil Ratings continues to combined the business and financial risk profiles of NBPL along with its subsidiaries, Sentrise Constructions LLP (SCLLP), Urban Space Projects Private Limited (USPPL), Ensemble Projects Private Limited (EPPL), Nambiar Enterprises LLP (NLLP), a step-down subsidiary, HomeLand Resorts Private Limited (HLRPL) while also included NEPLLP.
Please refer Annexure - List of Entities Consolidated, which captures the list of entities considered and their analytical treatment of consolidation. |
Key Rating Drivers & Detailed Description Strengths: Extensive industry experience of the group: The promoters have a proven track record of executing residential real estate projects in Bangalore. The key promoters, Mr. Ratheesh Nambiar (Group Chairman), Mr. Rajesh Nambiar (Chairman of NBPL) and Mr. Ramesh Nambiar (Managing Director), have expertise in real estate sector and have developed around 25 lakhs sq.ft. of residential & commercial real estate projects in Karnataka with ongoing 98 lakhs sq projects and upcoming of 144 lakh sq.ft. Thus, promoters’ experience of around one and half decade in this industry has helped the group to establish itself in the real estate market of Bangalore, Karnataka.
Comfortable operating efficiency supported by healthy booking progress on ongoing project: The projects under development for the group have seen adequate booking progress with above 70% average sale of under construction projects. Around 51% of the total construction cost in relation to these projects have been incurred by January 2025. The group collected ~Rs 478 crore in the first for the ten months ended January 31, 2025, and is expected to reach over Rs 709 crore for fiscal 2025. Collections may further improve to be upwards of Rs 1500 crore in fiscal 2026 due to higher bookings and new project launches. The adherence to timelines of the project, healthy booking progress for the upcoming projects will remain a key monitorable for the group.
Healthy financial risk profile with comfortable cash flow adequacy from pre-sales and significant land bank for future projects: Cash flow from operations (CFO; adjusted for future land expenses) remained comfortable with expected debt to CFO and CFO to interest to remain around 2.5 times and 3.3 times for fiscal 2025.The group holds about 310 acres of land bank in parts of Bengaluru which enables them to develop future projects with minimal costs and gives competitive advantage over its peers in the city. Peak debt is not expected to cross beyond Rs 300 crore over the medium term and reliance on external debt will remain a key monitorable for the credit.
Weaknesses: Exposure to risks associated with ongoing projects: The group has around 24 lakh sq ft of development under progress. While the overall progress is in line with schedule currently, operating performance will remain susceptible to timely completion of the projects and flow of customer advances.
Exposure to cyclicality inherent in the Indian real estate industry: The real estate sector in India is cyclical and affected by volatile prices, opaque transactions, and a highly fragmented market structure. Hence, the business risk profile will remain susceptible to risks arising from any industry slowdown. |
Liquidity: Adequate The group has adequate liquidity for funding the construction of its ongoing projects as well as the upcoming projects through a mix of customer advances, unsecured loans and bank loan. The customer advances for its ongoing have been healthy. The advances for the ongoing construction of the towers have also been decent so far. Although, the cash flows from the project is expected to remain sufficient to meet the term debt obligations, any unforeseen delay in project construction might result in cost overrun, thereby affecting repayments of term debt. Further any delay in receipt of advances from customers is also expected to impact the firm’s liquidity in a significant way. The upcoming projects are expected to be funded through customer collections. Further, the group had unencumbered cash and cash balances of Rs 96 crore as on March 31, 2025 |
Outlook: Stable Crisil Ratings believes the Nambiar group will continue to benefit over the medium term from its promoter’s extensive industry experience. |
Rating sensitivity factors Upward factors
Downward factors
|
About the Company NLLP was established in 2018. It is engaged in residential real estate development in Bengaluru.
NBPL, the flagship company of the Nambiar group, was incorporated in 2009. NBPL and its subsidiaries are engaged in residential real estate development in Bengaluru.
HRPL was incorporated in 1992 and is a subsidiary of USPPL and a step-down subsidiary of NBPL. It is involved in the development and maintenance of hotels, and tourist and recreational resorts.
The Nambiar group is owned and managed by Mr Ratheesh Nambiar, Mr Rajesh Nambiar and Mr Ramesh Nambiar. |
Key Financial Indicators
|
Any other information: Not Applicable |
Note on complexity levels of the rated instrument: |
Annexure - Details of Instrument(s)
|
Annexure – List of entities consolidated
|
| Annexure - Rating History for last 3 Years | |||||||||||||||||||||||||||||||||||||||
|
|||||||||||||||||||||||||||||||||||||||
| All amounts are in Rs.Cr. | |||||||||||||||||||||||||||||||||||||||
| Annexure - Details of Bank Lenders & Facilities | ||||||||
|
Criteria Details
|