Credit rating agency, CARE has reaffirmed ‘BB+’ rating to Samtex Fashions’ long-term bank facilities worth Rs 2.23 crore. The rating agency has also reaffirmed ‘A4+’ rating to the company’s short-term bank facilities worth 32.50 crore.
The ratings assigned to the bank facilities of Samtex Fashions (SFL) continue to be constrained by low profitability, moderately leveraged capital structure, low coverage indicators and working capital-intensive nature of operations. Furthermore, the ratings also factor in the company’s high exposure to the group entities, geographic concentration and its susceptibility to foreign exchange fluctuation risk.
Samtex Fashions is engaged in the manufacturing of readymade garments, mainly trousers, shirts, jackets, shorts and skirts. The manufacturing unit of the company is located at Noida, Uttar Pradesh with an installed capacity of 16 lakh pieces of garments per year as on March 31, 2014.
