Shivam Autotech Limited — Important, 04-01-2025: General Updates

Shivam Autotech Limited's bank facilities ratings have been reaffirmed, with long-term bank facilities rated at CARE BB-; Stable and short-term bank facilities rated CARE A4. The reaffirmation is bolstered by the experienced management and a favorable location strategy which supports operational capabilities. Notably, the company secured ₹105 crore from Modulus Alternatives in the form of non-convertible and optionally convertible debentures, primarily used for debt repayment.

However, several challenges persist, including a weak financial profile with continuous losses, high customer revenue concentration—40% coming from Hero MotoCorp—and vulnerability to raw material price fluctuations. Operating income narrowed marginally to ₹469.66 crore, and the overall gearing ratio worsened to 7.29x. Liquidity remains strained with expectations of generating ₹10 crore against debt obligations of around ₹42.90 crore. Continued monitoring of cash flows and management strategies will be crucial for recovery. The outlook remains stable with potential for improved order inflow and production efficiency.