Key Rating Drivers & Detailed Description

Strengths:

Established market position: Presence of over a decade in the agriculture industry has enabled the promoters to understand market dynamics and establish healthy relationship with suppliers and customers.

Healthy debt protection: NIPL’s debt protection measures have been comfortable. The interest coverage and net cash accrual to total debt ratio are expected to be around 5.9 times and 0.21 time, respectively, for fiscal 2021, and are expected at similar levels over the medium term.

Weakness:

Susceptibility to climatic conditions and volatility in raw material prices: Yield of agricultural commodities is dependent on adequate and timely monsoon. Thus, the company remains exposed to the risk of limited availability of key raw material during a weak monsoon. Production may also be impacted by pests or crop infection, leading to higher unpredictability in production and pricing of agricultural commodities and derived products.

Modest scale of operations: Business risk profile is constrained by small scale of operations in an intensely competitive segment. Turnover will remain subdued over the medium term and will continue to limit operating flexibility.

Key Financial Indicators

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