RATING RATIONALE
12Feb2024

S.K.L. Exports

Brickwork Ratings downgrades the long-term and short-term ratings for the Bank Loan Facilities of Rs. 82.65 Crs. of S.K.L. Exports based on best available information, as the issuer did not cooperate.

Particulars
Facilities** Amount (Rs.Crs.) Tenure Rating#
Previous Present Previous
(13 Feb 2023)
Present
Fund Based 22.65 22.65 Long Term BWR BB+/Stable
ISSUER NOT COOPERATING* /Downgrade
BWR BB /Stable
Continues to be in ISSUER NOT COOPERATING* category/Downgraded
60.00 60.00 Short Term BWR A4+
ISSUER NOT COOPERATING* /Downgrade
BWR A4
Continues to be in ISSUER NOT COOPERATING* category/Downgraded
Non Fund Based (5.00) (5.00) Short Term BWR A4+
ISSUER NOT COOPERATING* /Downgrade
BWR A4
Continues to be in ISSUER NOT COOPERATING* category/Downgraded
Grand Total 82.65 82.65 (Rupees Eighty Two Crores and Sixty Five lakhs Only)
#Please refer to BWR website www.brickworkratings.com for definition of the ratings
**Details of Bank Loan facilities,consolidation or instruments are provided in Annexure
*Issuer did not cooperate; based on best available information.


RATING ACTION / OUTLOOK / NATURE OF NON-COOPERATION

Brickwork Ratings (BWR) had rated the bank loan facilities of ' S.K.L. Exports.' in February 2023 by downgrading the ratings to BWR BB+/Stable/A4+ ISSUER NOT COOPERATING*/Downgrade. BWR has consistently taken up with the company through emails and telephone calls to provide the requisite information for the review of the ratings. Despite the best efforts of BWR to get at least the minimum required information for a review the company has not been submitting the monthly “No Default Statement” (NDS) as required by regulatory guidelines and remains to be non-cooperative. Due to the lack of management cooperation, BWR is unable to assess the company’s financial performance and its ability to service its debt and maintain a valid rating. Hence, based on the best available information, lack of management cooperation, Brickwork Ratings downgrades the long-term and short-term ratings to BWR BB/Stable/A4 and continues the ratings under ISSUER NOT COOPERATING* category, based on best available information.

The lenders/investors may note to exercise due caution while using the rating which mentions "Issuer Not Cooperating" since the rating lacks any projections or forward-looking component as it is arrived at based on the best available information without any management/banker's interaction.

LIMITATIONS OF THE RATING

Information availability risk is a key factor in the assessment of credit risk as generally cooperation by the rated entities to provide required information for a review of the assigned rating may also be accompanied by financial stress. Users of the credit ratings should therefore take into account the possible deterioration in the credit quality of the rated entity arising from its non-transparency withholding of information required for a review of the rating.
 

ABOUT THE ENTITY
Macro Economic Indicator Sector Industry Basic Industry
Consumer Discretionary Textiles Textiles & Apparels Other Textile Products

SKL Exports (SKLE) was incorporated in 1990 at Tirupur, Tamil Nadu as a proprietorship concern by Mr. N Govindasamy. Later, in 2002, it was reconstituted as a partnership firm between Mr. N Govindasamy and his family. The partnership firm is engaged in manufacturing hosiery garments. The operations of the Firm are primarily export-oriented with a major portion of the products being exported to customers in US and European countries. The firm is involved in export sales of women, men, kids and infant apparel. The manufacturing facility of the firm supports all processes including knitting, laundry, stitching, cutting, printing, dyeing and designing within in-house facilities. The manufacturing facilities are spread across the 4 units located at Tirupur, equipped with ~2000 sewing machines and automated facilities for cutting, printing, embroidery, etc. The total production capacity of SKLE is 100000 pieces/day. 

The Firm also owns and operates windmills which a capacity of 4.85 MW power. The generated power is majorly for the Firm’s captive usage. 

Mr. Govindasamy, Mrs. G. Radhamani, Mr. K. Mohanraj and Mr. A. Kumarasamy are the partners of the Firm.

Note: As per information available with BWR as on 14Feb2022.

KEY FINANCIAL INDICATORS

Please refer to the following link for the previous detailed rationale that captures the Key Financials Drivers and their Description, Liquidity Position. Rating Sensitivities, Key Financial Indicators. View Previous Document

NON-COOPERATION WITH PREVIOUS CREDIT RATING AGENCY

No non-cooperation rating with other credit rating agencies.

ANY OTHER INFORMATION

Not Applicable.

RATING HISTORY FOR THE PREVIOUS THREE YEARS (including withdrawal and suspended)
Facilities Current Rating  (2024) 2023 2022 2021
Type Tenure Amount
(Rs.Crs.)
Rating Date Rating Date Rating Date Rating
Fund Based LT 22.65
BWR BB/Stable
(Continues to be in ISSUER NOT COOPERATING* category/Downgraded)
13Feb2023
BWR BB+Stable
(ISSUER NOT COOPERATING* /Downgrade)
15Feb2022
BWR BBB- Stable
(Assignment)
NA
NA
Fund Based ST 60.00
BWR A4
(Continues to be in ISSUER NOT COOPERATING* category/Downgraded)
13Feb2023
BWR A4+
(ISSUER NOT COOPERATING* /Downgrade)
15Feb2022
BWR A3
(Assignment)
NA
NA
NFB SubLimit ST (5.00)
BWR A4
(Continues to be in ISSUER NOT COOPERATING* category/Downgraded)
13Feb2023
BWR A4+
(ISSUER NOT COOPERATING* /Downgrade)
15Feb2022
BWR A3
(Assignment)
NA
NA
Grand Total 82.65 (Rupees Eighty Two Crores and Sixty Five lakhs Only)
COMPLEXITY LEVELS OF THE INSTRUMENTS - Simple

BWR complexity levels are meant for educating investors. The BWR complexity levels are available at www.brickworkratings.com / download / ComplexityLevels.pdf. Investors queries can be sent to info@brickworkratings.com.

Hyperlink/Reference to applicable Criteria
Analytical Contacts

Likith M S

Rating Analyst likith.ms@brickworkratings.com

Suryanarayan N

Associate Director - Ratings suryanarayan.n@brickworkratings.com
1-860-425-2742 | media@brickworkratings.com
S.K.L. Exports
ANNEXURE-I
Details of Bank Facilities rated by BWR
SL.No. Name of the Bank/Lender Type Of Facilities Long Term(Rs.Crs.) Short Term(Rs.Crs.) Total(Rs.Crs.)
1 Axis Bank Ltd. Term LoanOut-standing 0.24 _ 0.24
2 Axis Bank Ltd. Term LoanOut-standing 0.49 _ 0.49
3 Axis Bank Ltd. Term LoanOut-standing 3.50 _ 3.50
4 Axis Bank Ltd. Covid -19 Emergency Line CreditSanctioned 4.43 _ 4.43
5 Axis Bank Ltd. GECLSanctioned 6.57 _ 6.57
6 Axis Bank Ltd. PC/PCFCSanctioned _ 20.00 20.00
Sub-Limit (ILC) Sanctioned (5.00)
7 Axis Bank Ltd. FBD/FBPSanctioned _ 20.00 20.00
8 ICICI Bank PC/PCFCSanctioned _ 20.00 20.00
9 SIDBI Term LoanOut-standing 7.42 _ 7.42
Total 22.65 60.00 82.65
TOTAL (Rupees Eighty Two Crores and Sixty Five lakhs Only)
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