Suvidhi Rayons Pvt. Ltd.

Rating Rationale
Brickwork Ratings has reaffirmed ‘BWR BB+’ for the Bank Loan Facilities
of Suvidhi Rayons Private Limited.
Brickwork Ratings (BWR) has assigned the following Rating1 for the Bank Loan Facilities
aggregating ₹ 33.45 Cr of Suvidhi Rayons Pvt. Ltd. (SRPL or the ‘company’):
Fund Based
(December 2013)
Limits (₹ Cr)
Previous Present
Cash Credit
Term Loan
Long Term (BWR Double B Plus)
(BWR Double B Plus)
(Outlook : Stable)
(Outlook : Stable)
INR Thirty Three Crores and Forty Five Lakhs only
*Availed from State Bank of India
BWR has principally relied upon the audited financial statements up to FY14, projected financial
statements for FY15, publicly available information and information/clarifications provided by
the company's management.
The rating continues to factor the promoters’ extensive industry experience, increasing
revenues, established relationships of SRPL with its customers, locational advantages and its
presence in the low-end of the textile value chain targeting low and medium income bracket
customers. The ratings are, however, constrained by decline in profitability, below average debt
protection metrics, volatility associated with raw material prices, intense competition from other
players in the textile industry and the working-capital-intensive nature of business.
Company Background
Suvidhi Rayons Private Limited, Bhilwara, Rajasthan was originally incorporated as Suvidhi
Capvest Pvt Ltd in 1997 and was engaged in investment activities. Subsequently, in 2002, SRPL
amended its business objective to deal in the textile business and simultaneously changed its
name to Suvidhi Rayons Private Limited.
SRPL has two manufacturing units at RIICO Industrial Area, Bhilwara with an installed
capacity of 104 Lakh meters per annum and a total of 108 looms. SRPL is engaged in the
manufacture of unfinished (grey)/synthetic fabrics (forming 70% of the total production) sold as
raw cloth in the form of Grey fabrics to Reliance Industries (Only Vimal). Finished Fabrics
forming 30% of the total production is used to make shirtings and suitings by the company itself
under the registered brand name of' 'SANTRO SUITINGS'.
Please refer to for definition of the Ratings
28 Jan 2015
During FY14, the company has ventured into non-core business activities of toll booth and real
estate development, construction etc.
Management Profile
The Board of Directors of SRPL comprises Shri Rajesh Kumar Jain, Managing Director, Shri
Milap Chand Jain, Shri Kamal Jain, Smt. Sushila Devi Jain and Shri Nitin Kumar Jain. SRPL
has experienced and competent professionals to handle its business activities.
Financial Performance
Net revenue from operations increased from Rs. 98.04 Cr during FY13 to Rs. 116.28 Cr during
FY14. Operating profit margin declined during FY14 to 5.40% from 7.66% during FY13.
However, net profit margins marginally increased from 1.11% during FY13 to 1.57% during FY14.
Tangible Net Worth as at March 31, 2014 was Rs 23.85 Cr. On a provisional basis, SRPL has
reported sales of Rs 87 Cr approx. for the period April-December 2014
Rating Outlook
The rating outlook is expected to be stable over the current year. The ability of the company to
improve the profitability margins, diversify its revenue and client profile, enhance its
geographical presence, improve its capital structure and manage its working capital efficiently
would remain the key rating sensitivities.
Analyst Contact
Relationship Contact
[email protected]
[email protected]
Media Contact
[email protected]
Disclaimer: Brickwork Ratings (BWR) has assigned the rating based on the information obtained from the issuer and other reliable sources,
which are deemed to be accurate. BWR has taken considerable steps to avoid any data distortion; however, it does not examine the precision or
completeness of the information obtained. And hence, the information in this report is presented “as is” without any express or implied warranty
of any kind. BWR does not make any representation in respect to the truth or accuracy of any such information. The rating assigned by BWR
should be treated as an opinion rather than a recommendation to buy, sell or hold the rated instrument and BWR shall not be liable for any losses
incurred by users from any use of this report or its contents. BWR has the right to change, suspend or withdraw the ratings at any time for any
28 Jan 2015