Infomerics revises 'IVR B+' rating on Kallam Textiles' credit facilities with stable outlook

17 Feb 2022 , 11:41 AM

Infomerics ratings has revised the ratings on Kallam Textiles Ltd bank facilities.

The Long Term Rating has been revised to IVR B+/Stable and the Short Term bank facilities to IVR A4.

Further, the ratings assigned to the bank facilities of Kallam Textiles Limited derives comfort from extensive experience of the promoters in the textile industry along with its well-integrated operations with its own ginning, ring spinning, open end spinning, weaving and dyeing divisions. The ratings also consider its satisfactory financial performance in 9MFY22.

However, these rating strengths are partially offset by highly fragmented nature of the industry coupled with intense competition marked by presence of large number of organised and unorganised players, past history of default, susceptibility of profitability to fluctuations in key raw material prices which affects sales realisations. The ratings also note its leveraged capital structure along with weak debt protection metrics and working capital-intensive nature of operations.

At around 11:42 AM, Kallam Textiles was trading at Rs19.25 apiece down by Rs0.2 or 1.03% against its previous closing of Rs19.45 apiece on the BSE.