CARE Ratings stated that the rating assigned to bank facilities of RRL derives strength from strong operational performance supported by healthy booking status in the intermediate stage of execution, consistent improvement in annual bookings and collections of the company, and favourable market position, particularly in Thane real estate market.
The rating also factors in the company’s strong financial risk profile marked by current net debt free status and healthy committed receivable coverage position.
The rating also factors in the presence of resourceful promoter group and experienced management profile which provides healthy financial flexibility to the company, being part of Raymond Group.
However, rating strengths remain constrained by execution and marketing risk associated with sizeable development plans in the pipeline, limited track record in real estate development, moderate though improving scale of operations and limited geographic presence, and inherent cyclicality associated with real estate sector.
The company’s ability to timely launch planned projects, ramp up collections, while maintaining a comfortable financial risk profile, will remain a key rating monitorable.
Raymond Realty (RRL) is the flagship real estate development company of the Raymond Group. On a consolidated basis, RRL has seven ongoing projects in Thane and Bandra, spanning over 45 lakh square feet (lsf).
The scrip fell 2.06% to currently trade at Rs 793.75 on the BSE.