Credit rating agency, Credit Analysis & Research (CARE) has revised rating of Godavari Drugs’ long term bank facilities worth Rs 6 crore to ‘BB+’ from ‘BB’. The rating agency has also revised rating of company’s short term bank facilities worth Rs 15 crore to ‘A4+’ from ‘A4’. The revision in the ratings assigned to the bank facilities of Godavari Drugs (GDL) is on account of significant increase in the total operating income of the company during FY15 (refers to the period April 01 to March 31) backed by increase in focus on direct sales, diversified clientele and improved operating cycle.
The ratings are, however, constrained by decrease in profitability margins during FY15, product concentration risk and presence in highly fragmented industry with many unorganized players.
