Rationale

 ICRA has withdrawn the rating assigned to the Rs. 658.25-crore NCD programme of JM Financial Products Limited (JMFPL) as there is no amount outstanding against the rated instrument. The rating has been withdrawn at the request of the company and as per ICRA's policy on the withdrawal and suspension of credit ratings. The assigned ratings factor in the demonstrated track record and established franchise of the JM Financial Group (the Group) in the domestic financial services industry, its diversified revenue stream and healthy financial profile with steady profitability and an adequate capitalisation level. While assigning the ratings, ICRA has taken a consolidated view of the Group (i.e. JM Financial Limited (JMFL) on a consolidated basis) due to the close linkages between the Group entities, given the common promoters and senior management team, shared brand name, and strong financial and operational synergies. Moreover, ICRA expects the financial, managerial and operational support from the Group to continue to be available to all key Group companies. The strengths are partially offset by the exposure to the volatility in capital markets and the portfolio concentration and inherent risk profile of the key segments (like real estate and promoter funding) in the wholesale lending segment (~85% of the total book as on March 31, 2021). The real estate sector has been facing a prolonged slowdown due to subdued sales and lack of funding access. The spread of the Covid-19 pandemic and the resulting nationwide lockdown further impacted the sector. ICRA notes that while regulatory and government interventions eased some pressure on the developers, a sustained pickup in sales across geographies is key for the developers over the medium term. Although a pickup in residential sales and collections was witnessed in H2 FY2021, the second wave of the pandemic impeded the sales momentum