Acuite assigns long-term rating of 'BBB-' on Lokesh Machines bank facilities; Outlook Stable

8 Feb 2022 , 01:13 PM

Acuite has assigned its long-term rating of ‘Acuite BBB-’ and short-term rating of ‘Acuite A3’ to the Rs100.50cr bank facilities of Lokesh Machines Limited (LML). The outlook is ‘Stable’.

“The rating continues to take cognizance of its experienced management, established track record, its improving scale, and profitability and healthy financial risk profile,” the company shared Acuite’s rating rationale in a filing on Monday.

It added, these strengths are partially offset by its high working capital intensive nature of operations; profitability remains susceptible to volatility in demand from underlying consumer sectors and intense competition in industry. Going forward, the company’s ability to reach its projected scale of operations and effectively manage its working capital requirements will be the key rating sensitivities.

At around 1. 16 pm, Lokesh Machines Ltd was trading at Rs79.90 per share down by Rs3.85 or 4.6% from its previous closing of Rs83.75 per share on the BSE.