Press Release
Bansal Pathways Habibganj Private Limited
January 25, 2023
Amount (₹
Facilities/Instruments Rating1 Rating Action
crore)
155.14
CARE BBB-; Revised from CARE BBB- (CE); Stable [Triple B Minus
Long Term Bank Facilities (Reduced
Stable (Credit Enhancement); Outlook: Stable]@
from 237.80)
CARE BBB-; Revised from CARE BBB- (CE); Stable / CARE A3 (CE)
Long Term / Short Term
24.70 Stable / CARE [Triple B Minus (Credit Enhancement); Outlook: Stable /
Bank Facilities
A3 A Three (Credit Enhancement)]@
Details of instruments/facilities in Annexure-1.
@ Backed by unconditional and irrevocable corporate guarantee of Bansal Construction Works Private Limited (BCWPL; rated CARE BBB-; Stable
/ CARE A3)
Unsupported Rating
As stipulated vide SEBI circular dated June 13, 2019
Withdrawn [Withdrawn]
Rationale and key rating drivers
The revision in the rating assigned to bank facilities of the Bansal Pathways Habibganj Private Limited (BPHPL) factors the
improvement in business and financial risk profile of the company. Earlier, the bank facilities of the company were based on the
credit enhancement in the form of an unconditional and irrevocable corporate guarantee extended by Bansal Construction Works
Private Limited. However, considering improvement in business and financial risk profile of the company on a standalone basis
the corporate guarantee does not provide credit enhancement in rating assessment. Hence, the analytical approach has been
revised to Standalone financials of Bansal Pathways Habibganj Private Limited.
The ratings continue to derive strength from its experienced promoter Bansal Construction Works Private Limited (BCWPL, rated
CARE BBB-; Stable / CARE A3) and long tail period post debt repayment providing financial flexibility. The rating takes cognizance
of completion of west side commercial buildings (CW-1 and CW-2) by December 30, 2021 against the scheduled completion date
of March 01, 2022 and the realization of customer advances from sale of leasehold rights from CW-2. The ratings also take
cognizance of pre-prepayment of Rs. 58.9 crore of the debt. The mandatory portion of the project related to station redevelopment
is complete and completion certificate is received for the same with effect from June 30, 2021.
The rating strengths are however tempered by lack of track record of revenue generation from railway station, saleability risk
associated with the commercial space, and exposure to interest rate fluctuations. The ability of the company to generate envisaged
revenue from the station and commercial spaces (CW-1 and CW-2) shall remain crucial from the credit perspective.
Rating sensitivities: Factors likely to lead to rating actions
Positive factors
• Track record of revenue generation from railway station and commercial building (CW-1)
• Timely receipt of sales realization at envisaged rates from commercial building (CW-2)
Negative factors
• Lower than envisaged sales realization leading to deterioration in credit profile.
Analytical approach: Standalone financials of the company.
Considering improvement in business and financial risk profile of the company on a standalone basis, the corporate guarantee
does not credit enhancement in rating assessment. Hence, the analytical approach has been revised to Standalone financials of
Bansal Pathways Habibganj Private Limited.
Key strengths
Experienced promoters and established track record: Bansal group has an established track record of over three decades
in road and civil construction in the state of Madhya Pradesh. Bansal group is managed by Mr Anil Bansal and Mr Sunil Bansal,
who have a longstanding experience in this business.
1
Complete definition of the ratings assigned are available at www.careedge.in and other CARE Ratings Ltd.’s publications
1 CARE Ratings Ltd.
Press Release
BCWPL is a reputed civil contractor with Government of Madhya Pradesh (GoMP), which enables it to bid for high value tenders.
Apart from the flagship entity BCWPL, the group also includes ten project SPVs including three operational annuity / toll + annuity
SPVs and one operational toll SPV.
Completion of the mandatory and non-mandatory (west side) part of the project along with receipt of customer
advances from sale of leasehold rights of commercial building CW-2: The mandatory project development (viz. Station
Redevelopment) is complete and has received completion certificate on June 30, 2021. The company has already started
streamlining revenues from the mandatory part from April 2022 onwards.
Commercial (Non- Mandatory) project was planned to be completed by March 01, 2022 as per the lender’s timeline. However,
company has decided to complete the west side buildings (CW-1 & CW-2) and applied for descoping the East side buildings with
cancellation of term loans there against. Accordingly, the company has completed the structural/civil work as per the revised plan
of the non-mandatory project as per the completion certificate issued by IRSDC dated December 30, 2021. The company has
received bookings in 173 units/shops out of 373 units/shops for its commercial building CW2. Till December 2022, Habibganj has
received customer advances of Rs.111.27 crore from retail and corporate customers.
Key weaknesses
Marketing Risk in the light of subdued real estate market environment: BPHPL shall derive revenue by way of sale of
commercial units in CW-2, rental income from leased out commercial units in CW-1 and income from railway station in the form
of lease, advertisements, parking etc. However, majority of the envisaged revenue is from sale and leasing of commercial units,
which exposes BPHPL to marketing and selling risk. The term debt repayments are required to be made in sixteen quarterly
instalments till March 2026. Timely sales of units in CW-2 along with track record of lease rentals from CW-1 are vital from the
perspective of debt servicing.
Inherent risk associated with real estate sector: The real estate sector in India is highly fragmented with most of the real
estate developers having a city-specific or region-specific presence. BPHPL is also exposed to the cyclicality associated with the
real estate sector which has direct linkage with the general macroeconomic scenario. The sector was already witnessing downturn
since last few years with the sluggish property markets on the back of high unsold inventory, low demand and stalled projects,
the outbreak of COVID-19 has further aggravated the problem. However, with relaxation in lockdown norms and minimal
disruptions due to third wave of the pandemic, improvement in buyers’ sentiments during last few quarters has been witnessed.
Liquidity: Adequate
Adequate liquidity is marked by the presence of DSRA covering 6 months of debt servicing obligations in the form of fixed deposit
of Rs 15.82 crore, healthy sales realization of commercial space from CW-2 building leading to realization of Rs 112.27 crore till
December 31,2022 thereby enabling the company to pre-pay the part debt.
Applicable criteria
Policy on default recognition
Factoring Linkages Parent Sub JV Group
Financial Ratios – Non-financial Sector
Liquidity Analysis of Non-financial sector entities
Rating Outlook and Credit Watch
Short Term Instruments
Infrastructure Sector Ratings
Policy on Withdrawal of Ratings
About the company
Incorporated in March 2016, Habibganj is a Special Purpose Vehicle (SPV) sponsored by BCWPL and technical support provided
by Prakash Asphaltings & Toll Highways India Ltd [PATH; rated CARE A+; Stable/ CARE A1] which are amongst the oldest
construction groups of Madhya Pradesh. This project is on Design, Build, Finance, Operate and Transfer (DBFOT) to undertake
an integrated project for development/redevelopment of a railway station (i.e. mandatory project development) along with
development of ancillary infrastructure comprising two trade centres (CW-1 and CW-2), one convention centre, two hotels (one
luxury and one budget) and one hospital (all together called commercial project development) in the vicinity of the station, on a
land available on lease for 45 years. The present Habibganj railway station was the first station of India with ISO 9001 certification.
The development agreement (DA) between Indian Railway Stations Development Corporation Ltd (IRSDC; Concessioning
Authority) and Habibganj (Developer) was signed on July 14, 2016. IRSDC was a joint venture company of Ircon International
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Press Release
Limited (rated CARE AAA; Stable / CARE A1+); a Govt. of India Undertaking, under Ministry of Railways) and Rail Land
Development Authority (RLDA), a statutory authority under the Ministry of Railways. The concession tenure of the mandatory and
the commercial projects is 8 years and 45 years respectively, from the date of DA. Habibganj achieved financial closure on January
12, 2017. Total envisaged project cost was Rs.600 crore is expected to be funded through sanctioned term loan of Rs.410 crore
and balance through promoter contribution and customer advances. However, the project has faced delays beyond the timelines
envisaged by the lenders of the project, therefore the company has completed the mandatory part (Railway Station) which
achieved Commercial Operations Date (COD) on June 30, 2021 and the trade centres in the ancillary infrastructure part and
capped the debt at Rs.237.80 crore. The balance portion of the project (East side) has been proposed to be completed by
customer advances and promoter funds.
Brief Financials (₹ crore) March 31, 2021 (A) March 31, 2022 (A) 9MFY23(UA)
Total operating income NA NA NA
PBILDT NA NA NA
PAT NA NA NA
Overall gearing (times) NA NA NA
Interest coverage (times) NA NA NA
A: Audited; UA: Unaudited; NA: Not applicable as the entity was in project stage during FY21 & FY22. Not available for 9MFY23.
Status of non-cooperation with previous CRA: Not Applicable
Any other information: Not Applicable
Rating history for the last three years: Please refer Annexure-2
Covenants of the rated instruments/facilities: Detailed explanation of the covenants of the rated instruments/facilities is
given in Annexure-3
Complexity level of the various instruments rated: Annexure-4
Lender details: Annexure-5
Annexure-1: Details of instruments/facilities
Coupon Maturity Size of Rating Assigned
Name of the Date of Issuance
ISIN Rate Date (DD- the Issue along with Rating
Instrument (DD-MM-YYYY)
(%) MM-YYYY) (₹ crore) Outlook
Fund-based - LT-Term March 31,
- - - 155.14 CARE BBB-; Stable
Loan 2026
Non-fund-based - LT/ ST- CARE BBB-; Stable /
- - - - 24.70
Bank Guarantee CARE A3
Un Supported Rating-Un
- - - - 0.00 Withdrawn
Supported Rating (LT/ST)
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Press Release
Annexure-2: Rating history for the last three years
Current Ratings Rating History
Date(s) Date(s) Date(s) Date(s)
Name of the
Sr. and and and and
Instrument/Bank Amount
No. Rating(s) Rating(s) Rating(s) Rating(s)
Facilities Type Outstanding Rating
assigned assigned assigned assigned
(₹ crore)
in 2022- in 2021- in 2020- in 2019-
2023 2022 2021 2020
1)CARE 1)CARE 1)CARE 1)CARE
CARE
Fund-based - LT- BBB- (CE); BBB- (CE); BBB (CE); BBB (CE);
1 LT 155.14 BBB-;
Term Loan Stable Stable Stable Stable
Stable
(06-Apr-22) (16-Jul-21) (31-Mar-21) (03-Mar-20)
1)CARE 1)CARE 1)CARE 1)CARE
CARE
BBB- (CE); BBB- (CE); BBB (CE); BBB (CE);
Non-fund-based - BBB-;
Stable / Stable / Stable / Stable /
2 LT/ ST-Bank LT/ST* 24.70 Stable /
CARE A3 CARE A3 CARE A3 CARE A3
Guarantee CARE
(CE) (CE) (CE) (CE)
A3
(06-Apr-22) (16-Jul-21) (31-Mar-21) (03-Mar-20)
1)CARE 1)CARE 1)CARE 1)CARE
Un Supported
BB+ / CARE BB+ / CARE BB+ / CARE BB+ / CARE
3 Rating-Un Supported LT/ST* - -
A4+ A4+ A4+ A4+
Rating (LT/ST)
(06-Apr-22) (16-Jul-21) (31-Mar-21) (03-Mar-20)
*Long term/Short term.
Annexure-3: Detailed explanation of the covenants of the rated instruments/facilities: NA
Annexure-4: Complexity level of the various instruments rated
Sr. No. Name of the Instrument Complexity Level
1 Fund-based - LT-Term Loan Simple
2 Non-fund-based - LT/ ST-Bank Guarantee Simple
3 Un Supported Rating-Un Supported Rating (LT/ST) Simple
Annexure-5: Lender details
To view the lender wise details of bank facilities please click here
Note on the complexity levels of the rated instruments: CARE Ratings has classified instruments rated by it on the basis
of complexity. Investors/market intermediaries/regulators or others are welcome to write to [email protected] for any
clarifications.
4 CARE Ratings Ltd.
Press Release
Contact us
Media contact
Name: Mradul Mishra
Phone: +91-22-6754 3596
E-mail: [email protected]
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Name: Prasanna Krishnan
Phone: +91-11-45333236
E-mail: [email protected]
Relationship contact
Name: Deepak Purshottambhai Prajapati
Phone: +91-79-4026 5656
E-mail: [email protected]
About us:
Established in 1993, CARE Ratings is one of the leading credit rating agencies in India. Registered under the Securities and
Exchange Board of India, it has been acknowledged as an External Credit Assessment Institution by the RBI. With an equitable
position in the Indian capital market, CARE Ratings provides a wide array of credit rating services that help corporates raise capital
and enable investors to make informed decisions. With an established track record of rating companies over almost three decades,
CARE Ratings follows a robust and transparent rating process that leverages its domain and analytical expertise, backed by the
methodologies congruent with the international best practices. CARE Ratings has played a pivotal role in developing bank debt
and capital market instruments, including commercial papers, corporate bonds and debentures, and structured credit.
Disclaimer:
The ratings issued by CARE Ratings are opinions on the likelihood of timely payment of the obligations under the rated instrument and are not recommendations to
sanction, renew, disburse, or recall the concerned bank facilities or to buy, sell, or hold any security. These ratings do not convey suitability or price for the investor.
The agency does not constitute an audit on the rated entity. CARE Ratings has based its ratings/outlook based on information obtained from reliable and credible
sources. CARE Ratings does not, however, guarantee the accuracy, adequacy, or completeness of any information and is not responsible for any errors or omissions
and the results obtained from the use of such information. Most entities whose bank facilities/instruments are rated by CARE Ratings have paid a credit rating fee,
based on the amount and type of bank facilities/instruments. CARE Ratings or its subsidiaries/associates may also be involved with other commercial transactions with
the entity. In case of partnership/proprietary concerns, the rating/outlook assigned by CARE Ratings is, inter-alia, based on the capital deployed by the
partners/proprietors and the current financial strength of the firm. The ratings/outlook may change in case of withdrawal of capital, or the unsecured loans brought
in by the partners/proprietors in addition to the financial performance and other relevant factors. CARE Ratings is not responsible for any errors and states that it has
no financial liability whatsoever to the users of the ratings of CARE Ratings. The ratings of CARE Ratings do not factor in any rating-related trigger clauses as per the
terms of the facilities/instruments, which may involve acceleration of payments in case of rating downgrades. However, if any such clauses are introduced and
triggered, the ratings may see volatility and sharp downgrades.
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please visit www.careedge.in
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