Ind-Ra has also assigned Maruthi's INR60m fund-based working capital limit Long-Term 'IND BB-' and Short-Term 'IND A4+' ratings.
The ratings reflect Maruthi's working capital intensive business model and its highly competitive business of trading of pharmaceuticals. This is reflected in its moderate credit profile with EBITDA margin of 3.1pc , low interest coverage of 2.9x and high net financial leverage of 3.3x in FY12 (year end March).
However, the ratings are supported by Maruthi's established relationship with its customers and over 35 years of its experience of founders in the stable pharmaceutical industry.
The ratings also take into account the company's comfortable liquidity position as indicated by its average cash credit utilisation of 78pc for the 12 months ended 28 February 2013.
--IBNS (Posted on 02-04-2013)