Press Release

MMTC Limited
June 14, 2024

Amount
Facilities/Instruments Rating1 Rating Action
(₹ crore)
CARE D; ISSUER NOT Rating continues to remain under
Long term bank facilities 1,055.00
COOPERATING* ISSUER NOT COOPERATING category
Long term / Short term bank CARE D / CARE D; ISSUER Rating continues to remain under
5,323.00
Facilities NOT COOPERATING* ISSUER NOT COOPERATING category
CARE D; ISSUER NOT Rating continues to remain under
Short term bank facilities 2,500.00
COOPERATING* ISSUER NOT COOPERATING category
Details of instruments/facilities in Annexure-1.
*Issuer did not cooperate; based on best available information.

Rationale and key rating drivers

CARE Ratings Limited (CARE Ratings) has been seeking information from MMTC Limited (MMTC) to monitor the ratings vide e-
mail communications dated January 30, 2024, February 09, 2024, and February 19, 2024, and numerous phone calls. However,
despite our repeated requests, the company has not provided the requisite information for monitoring the ratings. In line with
the extant Securities and Exchange Board of India (SEBI) guidelines, CARE Ratings has reviewed the rating based on the best
available information which however, in CARE Ratings Ltd.’s opinion is not sufficient to arrive at a fair rating. Ratings on MMTC’s
bank facilities will now be denoted as CARE D; ISSUER NOT COOPERATING*.

Users of this rating (including investors, lenders and the public at large) are hence requested to exercise caution
while using above rating(s)

Rating sensitivities: Not applicable

Analytical approach: Standalone

Outlook: Not applicable

Detailed description of key rating drivers:

At the time of last rating on March 16, 2023 the following were the rating weaknesses and strengths

Key weakness

High group exposure Neelachal Ispat Nigam Limited leading to moderation in financial & liquidity profile of MMTC:
The Cabinet Committee on Economic Affairs (CCEA) had given an ‘in-principle’ approval for strategic disinvestment of 100% equity
of Neelachal Ispat Nigam Limited in January 2020. As per BSE announcement dated Feb 01, 2022, strategic buyer has been
approved for privatization of Neelachal Ispat Nigam Limited. The highest bidder i.e. M/s Tata Steel Long Products Limited (TSPL)
for 93.71% of shares of Joint Venture partners of 4 CPSEs and 2 Odisha Govt State PSEs has been approved at the Bid Enterprise
Value of Rs. 12,100 cr.
In July 2022, Tata Steel Long Products Limited (‘TSLP’), a subsidiary of Tata Steel, has completed the acquisition of 93.71% in 1
million tons per annum ‘NINL’ from MMTC Ltd., NMDC Ltd., MECON Ltd., Bharat Heavy Electricals Ltd., Industrial Promotion and
Investment Corporation of Odisha Ltd., Odisha Mining Corporation Ltd., President of India, Government of Odisha. The acquisition
has been completed as per the terms and conditions of the Share Sale and Purchase Agreement entered on March 10, 2022, and
in accordance with the process being run by Department of Disinvestment & Public Asset Management (DIPAM). The aggregate
consideration which has been paid out by TSLP is Rs. 12,100 crores.
Accordingly, all the principal payment of the bank debt has been paid however there are ongoing discussions for waiver of penal
interest and other charges.

Key strength
MMTC’s position as India’s largest international trading house and established track record of trading in diverse
commodities

1
Complete definition of the ratings assigned are available at www.careedge.in and other CARE Ratings Ltd.’s publications

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 Press Release

As apprised by the company management, there are no business operations in MMTC currently and the final announcement on
its closure of operations is awaited.

Liquidity: Not Available

Environment, social, and governance (ESG) risks: Not Applicable

Applicable criteria
Policy on Default Recognition
Policy in respect of non-cooperation by issuers
Rating Outlook and Rating Watch
Factoring Linkages Government Support
Financial Ratios – Non financial Sector
Short Term Instruments
Liquidity Analysis of Non-Financial Sector entities

About the company and industry

Industry classification
Macro Economic Sector Industry Basic Industry
Indicator
Services Services Commercial Services & Supplies Trading & Distributors

MMTC, a public sector undertaking, was incorporated on September 26, 1963, to facilitate foreign trade in India and canalize the
export and import of essential minerals and metals. It is under the administrative control of the Ministry of Commerce & Industry,
and Government of India (GOI) held 89.93% stake in the company as on March 31, 2024. MMTC deals in multiple products and
markets. The business operations of the company span across six major divisions i.e. minerals, metals, precious metals, agro
products, fertilizers & chemicals and coal & hydrocarbons.

March 31, 2023 (A) March 31, 2024 (Abridged)

Brief Financials (₹ crore)

272.55 5.34
Total operating income

-121.54 -162.55
PBILDT

1,076.07 68.21
PAT

0.04 0.00
Overall gearing (times)

-1.08 -232.21
Interest coverage (times)
A: Audited UA: Unaudited; Note: ‘the above results are latest financial results available’

Status of non-cooperation with previous CRA: Not Applicable

Any other information: Not Applicable

Rating history for last three years: Annexure-2

Covenants of rated instrument / facility: Annexure-3

Complexity level of various instruments rated: Annexure-4

Lender details: Annexure-5

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Annexure-1: Details of instruments/facilities

Maturity Size of the Rating Assigned

Name of the Date of Issuance Coupon
ISIN Date (DD- Issue along with
Instrument (DD-MM-YYYY) Rate (%)
MM-YYYY) (₹ crore) Rating Outlook
CARE D; ISSUER
Fund-based - LT-Cash
- - - 855.00 NOT
Credit
COOPERATING*
CARE D; ISSUER
Fund-based - LT-Term
- - - 200.00 NOT
Loan
COOPERATING*
CARE D; ISSUER
Fund-based - ST-Working
- - - 740.00 NOT
Capital Demand loan
COOPERATING*
CARE D; ISSUER
Fund-based - ST-Working
- - - 1760.00 NOT
Capital Demand loan
COOPERATING*
CARE D / CARE D;
Non-fund-based - LT/
- - - 5323.00 ISSUER NOT
ST-BG/LC
COOPERATING*
*Issuer did not cooperate; based on best available information.

Annexure-2: Rating history for the last three years

Current Ratings Rating History

Date(s) Date(s) Date(s)

Sr. Name of the and and and
Date(s) and
No Instrument/Ban Amount Rating(s Rating(s Rating(s
Rating(s)
. k Facilities Type Outstandin Rating ) ) )
assigned in
g (₹ crore) assigned assigned assigned
2022-2023
in 2024- in 2023- in 2021-
2025 2024 2022
1)CARE D;
ISSUER NOT
COOPERATING
*
(16-Mar-23)
CARE D;
1)CARE D
Fund-based - LT- ISSUER NOT 2)CARE D
1 LT 855.00 - - (05-Apr-
Cash Credit COOPERATING (RWP)
21)
* (27-Dec-22)

3)CARE D (CW
with Positive
Implications)
(06-Apr-22)
1)CARE D;
ISSUER NOT
COOPERATING
CARE D;
Fund-based - ST- * 1)CARE D
ISSUER NOT
2 Working Capital ST 1760.00 - - (16-Mar-23) (05-Apr-
COOPERATING
Demand loan 21)
*
2)CARE D
(RWP)
(27-Dec-22)

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3)CARE D (CW
with Positive
Implications)
(06-Apr-22)
1)CARE D /
CARE D;
ISSUER NOT
COOPERATING
*
(16-Mar-23)
CARE D / CARE
D; ISSUER 1)CARE D
Non-fund-based - LT/S 2)CARE D /
3 5323.00 NOT - - (05-Apr-
LT/ ST-BG/LC T CARE D (RWP)
COOPERATING 21)
(27-Dec-22)
*

3)CARE D /
CARE D (CW
with Positive
Implications)
(06-Apr-22)
1)CARE D;
ISSUER NOT
COOPERATING
*
(16-Mar-23)
CARE D;
Fund-based - ST- 1)CARE D
ISSUER NOT 2)CARE D
4 Working Capital ST 740.00 - - (05-Apr-
COOPERATING (RWP)
Demand loan 21)
* (27-Dec-22)

3)CARE D (CW
with Positive
Implications)
(06-Apr-22)
1)CARE D;
ISSUER NOT
COOPERATING
*
(16-Mar-23)
CARE D;
1)CARE D
Fund-based - LT- ISSUER NOT 2)CARE D
5 LT 200.00 - - (05-Apr-
Term Loan COOPERATING (RWP)
21)
* (27-Dec-22)

3)CARE D (CW
with Positive
Implications)
(06-Apr-22)
*Issuer did not cooperate; based on best available information.
LT: Long term; ST: Short term; LT/ST: Long term/Short term

Annexure-3: Detailed explanation of covenants of the rated instruments/facilities: Not Applicable

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Annexure-4: Complexity level of the various instruments rated

Sr. No. Name of the Instrument Complexity Level

1 Fund-based - LT-Cash Credit Simple

2 Fund-based - LT-Term Loan Simple

3 Fund-based - ST-Working Capital Demand loan Simple

4 Non-fund-based - LT/ ST-BG/LC Simple

Annexure-5: Lender details

To view the lender wise details of bank facilities please click here

Note on the complexity levels of the rated instruments: CARE Ratings has classified instruments rated by it on the basis
of complexity. Investors/market intermediaries/regulators or others are welcome to write to [email protected] for any
clarifications.

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 Press Release

Contact us

Media Contact Analytical Contacts

Mradul Mishra Sabyasachi Majumdar

Director Senior Director
CARE Ratings Limited CARE Ratings Limited
Phone: +91-22-6754 3596 Phone: 91-9971022710
E-mail: [email protected] E-mail: [email protected]

Relationship Contact Ravleen Sethi

Director
Saikat Roy CARE Ratings Limited
Senior Director Phone: 91-120-4452016
CARE Ratings Limited E-mail: [email protected]
Phone: 91 22 6754 3404
E-mail: [email protected] Kunal Sharma
Lead Analyst
CARE Ratings Limited
E-mail: [email protected]

About us:
Established in 1993, CARE Ratings is one of the leading credit rating agencies in India. Registered under the Securities and
Exchange Board of India, it has been acknowledged as an External Credit Assessment Institution by the RBI. With an equitable
position in the Indian capital market, CARE Ratings provides a wide array of credit rating services that help corporates raise capital
and enable investors to make informed decisions. With an established track record of rating companies over almost three decades,
CARE Ratings follows a robust and transparent rating process that leverages its domain and analytical expertise, backed by the
methodologies congruent with the international best practices. CARE Ratings has played a pivotal role in developing bank debt
and capital market instruments, including commercial papers, corporate bonds and debentures, and structured credit.

Disclaimer:
The ratings issued by CARE Ratings are opinions on the likelihood of timely payment of the obligations under the rated instrument and are not recommendations to
sanction, renew, disburse, or recall the concerned bank facilities or to buy, sell, or hold any security. These ratings do not convey suitability or price for the investor.
The agency does not constitute an audit on the rated entity. CARE Ratings has based its ratings/outlook based on information obtained from reliable and credible
sources. CARE Ratings does not, however, guarantee the accuracy, adequacy, or completeness of any information and is not responsible for any errors or omissions
and the results obtained from the use of such information. Most entities whose bank facilities/instruments are rated by CARE Ratings have paid a credit rating fee,
based on the amount and type of bank facilities/instruments. CARE Ratings or its subsidiaries/associates may also be involved with other commercial transactions with
the entity. In case of partnership/proprietary concerns, the rating/outlook assigned by CARE Ratings is, inter-alia, based on the capital deployed by the
partners/proprietors and the current financial strength of the firm. The ratings/outlook may change in case of withdrawal of capital, or the unsecured loans brought
in by the partners/proprietors in addition to the financial performance and other relevant factors. CARE Ratings is not responsible for any errors and states that it has
no financial liability whatsoever to the users of the ratings of CARE Ratings. The ratings of CARE Ratings do not factor in any rating-related trigger clauses as per the
terms of the facilities/instruments, which may involve acceleration of payments in case of rating downgrades. However, if any such clauses are introduced and
triggered, the ratings may see volatility and sharp downgrades.

For the detailed Rationale Report and subscription information,

please visit www.careedge.in

6 CARE Ratings Ltd.