Intimation of Credit Rating(s) pursuant to regulation 30 of the SEBI (LODR) Regulations, 2015.
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CRISIL Ratings has downgraded Machino Plastics' long-term bank loan rating from 'Crisil BBB-/Stable' to 'Crisil BB+/Stable', with the downgrade applying to total bank facilities of Rs. 172.3 crore. The downgrade reflects a moderation in the company's business risk profile due to declining operating profitability, which fell to 6.91% up to September 2025 from 8.4% in FY25, and is now expected at around 8% for FY26 instead of CRISIL's earlier expectation of ~9%. The company has also taken on more debt to fund capex for a new Maruti Suzuki India Ltd (MSIL) unit, pushing its Total Outside Liabilities to Tangible Net Worth ratio to 5.30 times as of March 2025, against an earlier expectation of 4.5-4.8 times, with leverage expected to remain elevated. Revenue is projected to grow to Rs. 480-500 crore in FY26 from Rs. 388 crore in FY25, but net cash accruals are likely to remain tight at Rs. 20-23 crore against repayment obligations of Rs. 19-20 crore, leaving a modest cushion of 1.0-1.3 times. Liquidity is described as stretched, though bank limit utilisation has averaged only 42% over the past 12 months.
Negative for shareholders — the rating has slipped below investment grade into speculative ('junk') territory, which could raise future borrowing costs and signals financial stress from weak margins and high leverage. The stock may face near-term pressure as the downgrade highlights stretched cash flows despite stable outlook and ongoing MSIL relationship.