Credit rating agency, CARE has reaffirmed ‘B’ rating to Rs 27.97 crore long term bank facilities of Digjam. The rating agency has also reaffirmed ‘A4’ rating to Rs 54.50 crore short term bank facilities of the company.
The ratings continue to be constrained by the modest scale of operations of the company, its thin profitability, high leverage and working capital intensive operations. The ratings are further constrained by its presence in the highly competitive worsted fabric segment and susceptibility of its margins to foreign currency exchange rate fluctuation.
Digjam is primarily engaged in manufacturing worsted fabrics at its sole manufacturing facility in Jamnagar, Gujarat. It sells its fabric under the ‘Digjam’ brand through its established marketing network consisting of approximately 1250 retailers, 55 wholesalers and 26 exclusive retail outlets spread across India.