RATING RATIONALE

02Apr2026

Spykar Lifestyles Private Limited

Brickwork Ratings assigns the ratings for the Bank Loan Facilities of Rs. 282.04 Crs. of Spykar Lifestyles Private Limited

Particulars

Facilities**	Amount(Rs.Crs.)	Tenure	Rating#
Fund Based	282.04	Long Term	BWR BBB /Stable Assignment
	(48.00)
	(165.00)
Non Fund Based	(130.00)	Short Term	BWR A3 Assignment
Grand Total	282.04	(Rupees Two Hundred Eighty Two Crores and Four 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
*** The above GECL 2.0 o/s is as of 16 March 2026. RATING ACTION / OUTLOOK

Brickwork Ratings (BWR) assigned the long-term and short-term rating of BWR BBB(Stable)/BWR A3, for the bank loan facilities of Rs. 282.04 Crore of Spykar Lifestyles Private Limited. (hereinafter reffered as 'SLPL' or the 'Company')

The ratings assignment factors in the stable operating performance since the past fiscal years with sustained profit margins. The rating benefits from the management's vast experience in lifestyle apparel, 'Spykar's' strong domestic brand recognition, widespread distribution network, and the financial support from the Metdist group after their majority acquisition. Furthermore, the liquidity is expected to improve due to profits to be generated from the sale of non-core assets in FY26 & FY27. These strengths, however, are constrained by working capital-intensive operations marked by relatively high collection period, and Intense competition in the Indian Apparel Industry.

The stable outlook reflects the expectation that the company will continue to excel in the scale of operations and sustain the profitability while managing the liquidity.

KEY RATING DRIVERS

Credit Strengths:

Widespread distribution network through the Asset Light Model: :
SLPL sells apparel, accessories, and other products under the brand name ‘SPYKAR’ in India. These products are sold through exclusive stores, which are either exclusive brand outlets (EBOs) or Multi-Brand Outlets (MBOs). Products are available in stores such as Shoppers Stop, Lifestyle, Central Mall, Pantaloons, and outlet stores, among others.

As of 28 February 31, 2026, SLPL had a total of 1,925 outlets/points of sale spread across India, including 220 EBOs, 900 MBOs, 800 large outlet stores, and 5 E-commerce channels. Opening of new stores and closure of old stores is an ongoing exercise, depending on store performance. The asset light model minimises capital expenditure for scaling operations, aiding growth and working capital management. Additionally, franchisee security deposits fund 10-15% of store inventory.
Experienced and resourceful JV partners :

Spykar Lifestyles Private Limited (SLPL) is majority-owned by the Metdist Group, which holds approximately 98.48% of the company's shares through Metdist Industries Holdings Limited, Metmin Investment Holdings Limited, and Metmin Investment & Trading Private Limited. The Metdist Group, promoted by the Malaysia-based Bagri family, operates primarily in the manufacturing of electrical conductivity grade copper wires and hospitality as an additional business. The Group has demonstrated its commitment to SLPL by providing necessary financial support for its operations. Furthermore, Mr. Sanjay Vakharia contributes valuable experience in the retail business and has a long-standing association with the Spykar brand.
Above-average financial risk profile: :
The company has demonstrated improved operations year-over-year (YOY), driven by increased sales volume and realisation. Operating income stood at Rs. 619.84 Crore in FY25, up from Rs. 597.49 Crore in FY24. For the first eleven months of FY26 (10MFY26), the company reported operating income of Rs. 478.52 Crores, which is likely to match the previous year's level. The operating profit margin has also improved, increasing to 8.06% in FY25 (from 6.73% in FY24), and is projected to remain above 8% in both FY26 and FY27. The financial risk profile is expected to remain stable, as the company does not foresee any debt-funded capital expenditure going forward. The Gearing ratio improved to 2.80x in FY25 (from 3.01x in FY24), and is anticipated to improve further following the repayment of the GECL loan using profits from the sale of non-core assets. Interest and debt coverage ratios were adequate at 1.26x and 1.07x, respectively, in FY25.

Credit Risks:

Intense competition and susceptibility to volatile raw material prices :
The Indian apparel industry is characterised by significant fragmentation, with the unorganised sector representing the majority of the market, followed by International brands. SLPL faces intense competition from established lifestyle apparel brands, including Mufti, Pepe Jeans, Killer, etc. The company's performance is inherently vulnerable to shifts in fashion trends, consumer spending habits, and broader economic cycles. To sustain and grow its market share in India, the company needs to implement effective localisation strategies, demonstrate a nuanced understanding of Indian consumer preferences, and offer a compelling value proposition. Furthermore, company margins are susceptible to volatility in raw material prices.
The working capital-intensive nature of operations :
SLPL's total outside liabilities to net worth ratio remains high at 4.76x in FY25, a marginal improvement from 4.99x in FY24. This elevated ratio is primarily due to increased payables and a high utilisation of working capital facilities. The working capital cycle has deteriorated, increasing to 217 days in FY25 from 198 days in FY24. This is a result of a longer collection period, driven by the 6-7 month credit period extended to large retailers, while payables remain around 5 months. The inventory period also increased to 142 days in FY25 compared to 124 days in FY24. Given the risk of inventory obsolescence due to fast-changing fashion trends, timely liquidation is critical to maintaining stable operating profitability.

ANALYTICAL APPROACH - Standalone

BWR has relied upon the standalone audited financials of Spykar Lifestyles Private Limited, publicly available information, and clarification/information provided by the Company. Further, to arrive at its ratings, BWR has applied its rating methodology as detailed in the Rating Criteria as per the hyperlinks.

RATING SENSITIVITIES

Positive:

An improvement in the operating revenue with a sustained operating margin above 8% and a significant reduction in the receivables, leading to an overall improvement in the liquidity profile

Negative:

Declining of operating margins from the existing level, and further deterioration of TOL/TNW above 4x, collection period of more than 7 months or an increase in debt, leading to stretched working capital cycle.

LIQUIDITY INDICATORS - Adequate

SLPL's net cash generation improved in the past two fiscals to Rs. 10.36 Crore in FY25 (FY24: Rs. 7.60 Crore) against the debt obligation between Rs. 4-5 Crore. The company's earnings are sufficient to cover interest payments in a timely manner. The company's sanctioned working capital limits are Rs. 278 Crores, with an average utilization exceeding 85% over the last 6-12 months, ending on February 28, 2026. The extended collection period of 7 months stems from the retail and franchise-based models, which necessitate a 6-8 month credit period for retailers. SLPL is expecting a profit of Rs. 4 Crores in FY26 and Rs. 18 Crores in FY27 from the sale of non-core assets, to enhance liquidity and reduce debt. This addition of funds is anticipated to reduce the long-term debt by Rs. 4 Crores and provide an additional cushion for working capital needs, thereby reducing reliance on external debt. The cash and bank balance is Rs. 22.02 Crore, including lien-marked FDRs of Rs. 21.87 Crore as on 27 March, 2026. BWR expects that the company's ability to efficiently manage its working capital will be a key rating sensitivity.

ABOUT THE ENTITY

Macro Economic Indicator	Sector	Industry	Basic Industry
Consumer Discretionary	Consumer Services	Retailing	Speciality Retail

Spykar Lifestyle Private Ltd. (SLPL), established in 1992, operates in the domestic market, specializing in retailing affordable to premium denim wear under the 'Spykar' brand. The company offers a comprehensive casual apparel range, including jeans, fashionable denims, shirts, t-shirts, caps, and cargo pants. SLPL follows an asset-light retail strategy, focusing on brand development, product design, and distribution, while production is outsourced; the company itself does not engage in manufacturing but handles primary designing and specific tasks.

As of March 2025, Spykar maintains a substantial presence across India, utilizing various channels: 220 Exclusive Brand Outlets (EBOs), 900 Multi-Brand Outlets (MBOs), 800 Large Format Stores (LFS), and 5 E-commerce platforms.

ESG Profile

KEY FINANCIAL INDICATORS (Standalone)

Key Parameters	Units	FY 23 - 24 (Audited - Annual)	FY 24 - 25 (Audited - Annual)	FY 25 - 26 (Unaudited - Others(31 Jan, 2025))
Operating Revenue	Rs.Crs.	597.49	619.84	478.52
EBITDA	Rs.Crs.	40.21	49.93	36.52
PAT	Rs.Crs.	5.82	7.51	5.70
Tangible Net Worth	Rs.Crs.	99.64	107.21	106.80
Total Debt / Tangible Net Worth	Times	3.01	2.80	2.72
Current Ratio	Times	1.33	1.35	Not Available

KEY COVENANTS OF THE FACILITY RATED

As per the normal terms and conditions stipulated in the sanction letters.

STATUS OF NON-COOPERATION WITH PREVIOUS CRA

Not Applicable

RATING HISTORY FOR LAST THREE YEARS (including withdrawal and suspended)

Facilities	Current Rating (2026)			2025		2024		2023
Type	Tenure	Amount (Rs.Crs.)	Rating	Date	Rating	Date	Rating	Date	Rating
Fund Based	LT	282.04	BWR BBB/Stable (Assignment)	NA	NA	NA	NA	NA	NA
FB SubLimit	LT	(48.00)	BWR BBB/Stable (Assignment)	NA	NA	NA	NA	NA	NA
		(165.00)	BWR BBB/Stable (Assignment)	NA	NA	NA	NA	NA	NA
NFB SubLimit	ST	(130.00)	BWR A3 (Assignment)	NA	NA	NA	NA	NA	NA
Grand Total		282.04	(Rupees Two Hundred Eighty Two Crores and Four lakhs Only)

*** The above GECL 2.0 o/s is as of 16 March 2026. Hyperlink/Reference to applicable Criteria

Analytical Contacts
KunjalDabhi Ratings Analyst kunjal.d@brickworkratings.com	Niraj Kumar Rathi Senior Director Ratings niraj.r@brickworkratings.com
1-860-425-2742 \| media@brickworkratings.com	Customer Support \| CustSupport@brickwrokratings.com

Spykar Lifestyles Private Limited

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.)	Complexity of the Instrument
1	Axis Bank Ltd.	Cash Credit - Sanctioned	48.00	_	48.00	Simple##
	Sub-Limit (Working Capital Demand Loan) - Sanctioned	(48.00)
2	ICICI Bank	Cash Credit - Sanctioned	165.00	_	165.00	Simple##
	Sub-Limit (Letter of credit) - Sanctioned		(130.00)
	Sub-Limit (Working Capital Demand Loan) - Sanctioned	(165.00)
3	Yes Bank	Cash Credit - Sanctioned	65.00	_	65.00	Simple##
4	Yes Bank	GECL 2.0 - Out-standing	4.04	_	4.04	Simple##
Total			282.04	0.00	282.04
TOTAL (Rupees Two Hundred Eighty Two Crores and Four lakhs Only)

* The above GECL 2.0 o/s is as of 16 March 2026.

## 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.

ANNEXURE-II

INSTRUMENT DETAILS

Instrument	Issue Date	Amount (Rs.Crs)	Coupon Rate (%)	Maturity Date	ISIN Particulars	Complexity of the Instrument
Nil	Nil	Nil	Nil	Nil	Nil	Nil

ANNEXURE-III

List of entities consolidated

Name of Entity	% Ownership	Extent of consolidation	Rationale for consolidation
Nil	Nil	Nil	Nil

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