Crisil rates Wealth Agro scheme risky

MUMBAI, July 10: The collective investment schemes of Wealth Agro Plantation India Ltd (WAPL) have been assigned a `Grade V’ rating by Crisil indicating high uncertainty about the assured returns in the form of produce and/or cash by the company. “The rating reflects the overall high risk profile of the company on account of its low capitalisation level, nascent stage of operations, negligible operational cash flows, and inherent vulnerability of business to vagaries of nature,” said a Crisil statement.

The company is part of the Ahmedabad-based Imaculate group of companies. The rating also factors in the high level of uncertainty associated with the teak plantation business due to the long tenure of maturity of plantations and high dependence of the company on fisheries business to meet its repayment obligations. In addition, the company has a high cost of mobilising investor funds and follows a liberal accounting policy, added the statement.

The company was promoted by B K Mandal in September 1995 toengage in the commercial plantation of teak trees and cash crops.