CARE Nepal assigns A3 to short term bank facilities of Kamala Rolling Mills; Find financial highlights of the company

CARE Ratings Nepal Limited (CRNL) has assigned rating of „CARE-NP A3‟ to the short term bank facilities of Kamala Rolling Mills Private Limited (KMPL). 

Key Rating Strengths

• Established and long track record of operations along with experienced directors in the related field
• Moderate operational and financial performance in last two years, however subdued performance in FY19
• Moderate capital structure and debt service coverage indicators
• Established brand with country wide market presence
• Diverse product range catering to wide spectrum of industries and established marketing setup
• Expected growth in demand of steels products in the country

Key Rating Weaknesses

• Raw material price volatility risk and foreign exchange fluctuation risk
• Working capital intensive nature of operations
• Exposure to volatile interest rates
• Presence in highly fragmented and competitive nature of steel industry

About the Company

KMPL is a private limited company incorporated on December 2, 1991 for manufacturing TMT Bars, Flat, Sections, Galvanized Iron/Hard Bright (GI/HB) Wires, Shutter Spring, Barbed Wire, etc., having plant in Biratnagar, Morang, Nepal. The company is promoted by different individuals belonging to the Vishal group of companies. Currently, the total installed capacity of the plant is 80,000 Metric Tons Per Annum (MTPA) out of which the capacity for Rolling Mills is 60,000 MTPA and Wire Section is 20,000 MTPA. 

Brief Financial Performance during the last 3 years is as follows:

(Rs. In Million)

*Unaudited

Details of the Facilities rated

Source: CARE Nepal Rating