CARE Nepal assigns BB+ and A4+ to long term and short term bank facilities of Kankai International Builders

CARE Ratings Nepal Ltd. (CRNL) has reaffirmed rating of ‘CARE-NP BB+’ to the long term bank facilities and ‘CARE-NP A4+’ to the short term bank facilities of Kankai International Builders Private Limited (KIB).

Key Rating Weaknesses

• Tender based nature of operations in high competitive intensity of the construction industry
• Working capital intensive nature of business

Key Rating Strengths

• Experienced promoters & management team
• Established track record in executing Roads, Bridges, Building and Irrigation and Sanitation Project
• Moderate order book position with mid-term revenue visibility and diversified projects
• Ownership of sizable equipment fleet
• Comfortable financial risk profile and debt coverage indicators
• Escalation clause in majority of the contracts

About the Company

KIB is a private limited company, incorporated in July 26, 1987. KIB is a mid-scale construction company having major promoter Mr. Ram Prasad Mainali and his family holding 97.6% of total shares, with over 3 decades of experience in civil construction. The company is in the business of civil construction of Roads, Bridges, Water Supply & Sanitation, Canals etc. across Nepal and mostly executes Government contracts. The consolidated revenue of the company includes revenue from the standalone company and revenue from the JV entities in the proportion of the JV stake.

Brief Consolidated Financial Performance during the last 3 years ending FY18 is as follows:

(Rs in Million)

  Details of the Facilities rated

Source: www.carenepalratings.com