TVS Electronics Ltd.

Brickwork Ratings reaffirms the ratings for the Bank Loan Facilities of Rs. 46.00 Crs. of TVS Electronics Ltd.

Facilities** Amount (Rs.Crs.) Tenure Rating#
Previous Present Previous
(19 Jun 2020)
Fund Based 25.00 25.00 Long Term BWR A- /Stable
BWR A - /Stable
Non Fund Based 21.00 21.00 Short Term BWR A2+
BWR A2 +
(10.00) (10.00)
Grand Total 46.00 46.00 (Rupees Forty Six Crores 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


The ratings of TVS Electronics Limited (TVSE or the company) continue to factor in the company's overall business and financial performance, comfortable credit profile marked by strong debt protection metrics and a low gearing, and  growing market demand for newly introduced products. The ratings continue to draw strength from the strong parentage and brand equity of the TVS group, experienced and professional management and robust financial and risk management practices. The rating strengths remain constrained by the exposure to intense industry competition, technological obsolescence  and forex risks.

Brickwork Ratings (BWR) takes note of the potential impact of the Covid-19 pandemic on the business and financial risk profiles of TVSE mostly during Q1FY21. However the recovery was quicker-than-expected and the profitability margins in H2FY21 were better than historical figures, backed by the launch of new product lines, which offered better margins. The company has not opted for the Covid-19-related RBI moratorium package in view of sufficient liquidity.

BWR believes TVSE’s business risk profile will be maintained over the medium term. The Stable outlook indicates a low likelihood of rating change over the medium term. The outlook may be revised to Positive if substantial growth in revenue and profitability strengthens the financial risk profile. The outlook may be revised to Negative with lower-than-expected revenue/cash accruals or a deterioration in profitability/debt indicators and/or significant increase in operating cycle, especially in view of any prolonged impact of Covid-19 and a deterioration in the capital structure due to debt-financed capital expenditure, thus weakening the company’s financial risk profile.



Credit Strengths:

Credit Risks:


BWR has applied its rating methodology as detailed in the Rating Criteria (hyperlinks provided at the end of this rationale). The company does not have subsidiaries.


The company's ability  to successfully stabilise its fresh business initiatives, improve its revenue and profitability through the newly added products and strengthen its business profile would be key rating sensitivities.


  • Substantial growth in revenue and profitability, strengthening the financial risk profile
  • Stabilisation of new product lines with an increased scale of operations resulting in higher contribution to revenue and profitability on a sustained basis


  • Prolonged impact of Covid-19, affecting revenues and cash flows due to a disruption in production and demand, leading to a material deterioration in its financial risk profile and liquidity
  • Significant deterioration in profitability margins and/or significant debt-funded capex


The company’s liquidity position is adequate, as seen in the average working capital utilisation of below 50% during the last 12 months. Cash and cash equivalents were around Rs.9 Cr as on 31 March 2021 (including the fixed deposits and mutual fund). The Current Ratio was 1.44 times, and Net Cash Accruals/Total Debt was 2.35 times as on 31 March 2021. The EBITDA is sufficient to cover interest and finance charges. The company does not have long-term borrowings as on date. BWR notes that on account of adequate liquidity, the company has not opted for the Covid-19-related RBI moratorium relief package.


TVS Electronics Limited (TVSE), Chennai, is a part of the TVS group, managed by Mr Gopal Srinivasan, who also heads TVS Capital Funds Ltd. Founded in 1986 as an IT peripheral manufacturer, it is now a leading Transaction Automation IT Product manufacturer and service provider. TVSE has its production/repair facilities at Dehradun (Uttarakhand), Chennai (TN) and Tumkur (Karnataka). The company is listed on the BSE and NSE. TVSE’s business consists of three revenue segments, viz., (a) Products & Solutions (b) Customer Support Services and (c) Distribution & Fulfillment services. The products cater to seven broad sectors, viz., Retail – SME, Government, BFSI, Hospitality, Healthcare, E-commerce and Transport, Large Format Retail (LFR) Stores and Quick Service Restaurants (QSR).


Key Parameters Units FY 20-21
FY 19-20
Operating Revenue Rs.Crs. 224.60 258.72
EBITDA Rs.Crs. 8.55 10.91
PAT Rs.Crs. 0.77 0.39
Tangible Net Worth Rs.Crs. 63.79 63.90
Total Debt/Tangible Net Worth Times 0.06 0.32
Current Ratio Times 1.28 1.21

The terms of sanction include standard covenants normally stipulated for such facilities.





RATING HISTORY FOR THE PREVIOUS THREE YEARS (including withdrawal and suspended)
Facilities Current Rating  (2021) 2021 (History) 2020 2019 2018
Type Tenure Amount
Rating Date Rating Date Rating Date Rating Date Rating
Fund Based LT 25.00
BWR A-/Stable
BWR A-/Stable
BWR A-/Stable
BWR BBB+/Stable
Non Fund Based ST 21.00
NFB SubLimit ST (10.00)
Grand Total 46.00 (Rupees Forty Six Crores Only)

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.

Analytical Contacts

Naveen S

Manager - Ratings Board : +91 80 4040 9940 naveen.s@brickworkratings.com

Saakshi Kanwar

Senior Manager Ratings saakshi.k@brickworkratings.com
1-860-425-2742 | media@brickworkratings.com
TVS Electronics Ltd.
Details of Bank Facilities rated by BWR
SL.No. Type Of Facilities Long Term(Rs.Crs.) Short Term(Rs.Crs.) Total(Rs.Crs.)
1 Cash CreditSanctioned 15.00 _ 15.00
2 ILC/FLC/BGSanctioned _ 20.00 20.00
3 Cash CreditSanctioned 10.00 _ 10.00
Sub-Limit (BG/LC) Sanctioned (10.00)
4 Credit Exposure Limit (CEL)Sanctioned _ 1.00 1.00
Total 25.00 21.00 46.00
TOTAL (Rupees Forty Six Crores Only)
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