Press Release

Press Release

December 03, 2025

Karnani Solvex Private Limited
Rating Reaffirmed

Product	Quantum (Rs. Cr)	Long Term Rating	Short Term Rating
Bank Loan Ratings	61.94	ACUITE BB- \| Stable \| Reaffirmed	-
Bank Loan Ratings	0.75	-	ACUITE A4 \| Reaffirmed
Total Outstanding	62.69	-	-
Total Withdrawn	0.00	-	-

Rating Rationale

Acuité has reaffirmed the long term rating of “ACUITE BB-” (read as ACUITE double B minus) and short term rating of “ACUITE A4” (read as ACUITE A four) on the Rs.62.69 Cr. bank facilities of Karnani Solvex Private Limited. The outlook is "Stable".

Rationale for Rating
The rating factors in the operating revenue, which stood at Rs.293.12 Cr. in FY2025 as against Rs.338.60 Cr. in FY2024 owing to the decrease in sales realization albeit increase in the EBITDA margin which stood at 1.63% in FY2025 against 1.36% in FY2024. The PAT margin of the company stood at 0.08% in FY2025 and FY2024. Moreover, the company has registered revenue of Rs.119.51 Crore in 7M FY2026. The rating further takes into account the moderate working capital operations of the company marked by GCA days of 87 days as on 31st March 2025. The rating also draws comfort from the established track record of operations and experience of the management in the same line of business. However, the aforesaid factors are partly offset by the average financial risk profile of the company as exhibited by gearing ratio at 2.35 times as on 31st March 2025 along with interest coverage ratio and debt service coverage ratio at 1.25 times and 0.58 times respectively as on 31st March 2025. Further, liquidity position of the company is stretched as reflected by insufficient net cash accruals against debt obligations wherein the gap in repayments has been met by the working capital management and same will remain a key rating sensitivity. Acuite also notes that the rating remains constrained by the susceptibility of margins to fluctuations in raw material prices, demand and supply demographics due to the highly competitive and fragmented nature of the industry.

About the Company

Karnani Solvex Private Limited (KSPL) was incorporated in 2007. The company is engaged in the processing and manufacturing of rapeseed meal (de-oiled cake) and mustard solvent oil. The present directors of the company are Mr. Narayan Karnani and Mr. Sanjay Kumar Karnani. The registered office of the company is in Rajasthan.

Unsupported Rating

Not Applicable

Analytical Approach

Acuité has considered the standalone business and financial risk profile of Karnani Solvex Private Limited to arrive at the rating.

Key Rating Drivers

Strengths

Benefits derived from experienced management
KSPL was incorporated in 2007 and is engaged in processing and manufacturing of rapeseed meal (de-oiled cake) and mustard solvent oil. The directors of the company are Mr. Sanjay Kumar Karnani and Mr. Narayan Karnani. The expertise and experience in the industry gained over the years and the long-term presence in the industry has helped KSPL in developing healthy relationships with its suppliers and reputed clientele like Adani Wilmar Limited, Agrocorp International PTE Limited Wilmar Trading PTE Limited etc. Acuite believes that the company will continue to derive benefit from the strong understanding of market dynamics of the experienced management.

Moderate Working Capital Operations
The working capital operations of the company remained moderate marked by GCA days at 87 days as on 31st March 2025 as against 78 days as on 31st March 2024. The inventory holding stood at 49 days as on 31st March 2025 as against 39 days as on 31st March 2024 as the company needs to maintain adequate inventory as and when required for order execution. Further, the debtor days of the company stood at 35 days as on 31st March 2025 as against 36 days as on 31st March 2024 and the creditor days stood at 11 days as on 31st March 2025 as against 10 days as on 31st March 2024. Acuité expects the working capital operations of the company to remain at similar levels in near to medium term owing to the nature of operations.

Weaknesses

Decrease in revenue albeit increase in operating profitability
The operating income of the company stood at Rs.293.12 Crore in FY2025 against Rs.338.60 Crore in FY2024 owing to decrease in the sales realization in FY2025 as against the previous year. Additionally, in FY2024, the company traded de-oiled cake, which was a one-time event on the back of high order inflow and the same further supported revenue of the company. However, no such trading activity was done in FY2025. Further, the operating margins of the company stood at 1.63% in FY2025 against 1.36% in FY2024 supported by decrease in the raw material procurement costs in FY2025. Likewise, the PAT margin stood at 0.08% in FY2025 and FY2024. Moreover, the company has registered revenue of Rs.119.51 Crore in 7M FY2026. Acuite believes that going forward, the ability of the company to sustain its scale of operations while maintaining its profitability margins will remain a key rating sensitivity.

Average Financial Risk Profile
The financial risk profile of the company is average marked by a net worth of Rs.23.81 Crore as on 31st March 2025 as against Rs.23.56 Crore as on 31st March 2024. The slight increase in the net worth is on account of accretion of profits into reserves. The capital structure of the company is marked by gearing ratio which stood at 2.35 times as on 31st March 2025 as against 2.48 times as on 31st March 2024. Further, the coverage indicators of the company are reflected by interest coverage ratio and debt service coverage ratio, which stood at 1.25 times and 0.58 times respectively as on 31st March 2025 as against 1.28 times and 0.91 times respectively as on 31st March 2024. The TOL/TNW ratio of the company stood at 2.70 times as on 31st March 2025 as against 2.86 times as on 31st March 2024 and Debt-EBITDA stood at 11.57 times as on 31st March 2025 as against 12.50 times as on 31st March 2024. Acuité expects the financial risk profile of the company to remain similar in near to medium term with no debt funded capex plans in near to medium term.

Susceptibility to fluctuations in agriculture based commodity business
The operations of the company are exposed to the inherent risks associated with the agriculture based commodity business, such as availability of raw materials, fluctuations in prices, and changes in government regulations. The price and availability of raw materials depends on several factors beyond the company’s control like production levels, market demand, trade restrictions, seasonal variations, etc. Hence, the profitability of the company is highly susceptible to the ability of the company to pass on the same to its customers. Further, the demand-supply of vegetables is affected by changes in regulations in exporting and importing countries. Acuité believes that the ability of the company to pass on such an adverse impact to its customers remains a key sensitivity factor.

Rating Sensitivities

Movement of the profitability margins while scaling up of operations.
Movement in debt protection metrices.
Timely debt repayment ability

Liquidity Position

Stretched

The liquidity position of the company is stretched marked by net cash accruals of Rs.0.87 crore as on 31st March 2025 against the debt repayment obligation of Rs.4.38 Cr. over the same period. The gap in repayments has been met through working capital management by the company. The cash and bank balances of the company stood at Rs.0.33 crores as on 31st March 2025. The current ratio stood at 1.30 times as on 31 March 2025 as against 1.33 times as on 31 March 2024. Further, the fund based bank limit of the company stood utilized at 87.10% in the last six months ended September, 2025. Acuité believes that going forward the company is expected to remain in line with the previous year hence the ability of the company to manage and improve its liquidity position will remain a key rating sensitivity.

Outlook: Stable

Other Factors affecting Rating

None

Key Financials

Particulars	Unit	FY 25 (Actual)	FY 24 (Actual)
Operating Income	Rs. Cr.	293.12	338.60
PAT	Rs. Cr.	0.24	0.28
PAT Margin	(%)	0.08	0.08
Total Debt/Tangible Net Worth	Times	2.35	2.48
PBDIT/Interest	Times	1.25	1.28

Status of non-cooperation with previous CRA (if applicable)

Not Applicable

Any other information

None

Applicable Criteria

• Default Recognition :- https://www.acuite.in/view-rating-criteria-52.htm
• Manufacturing Entities: https://www.acuite.in/view-rating-criteria-59.htm
• Application Of Financial Ratios And Adjustments: https://www.acuite.in/view-rating-criteria-53.htm

Note on complexity levels of the rated instrument

In order to inform the investors about complexity of instruments, Acuité has categorized such instruments in three levels: Simple, Complex and Highly Complex. Acuite’s categorisation of the instruments across the three categories is based on factors like variability of the returns to the investors, uncertainty in cash flow patterns, number of counterparties and general understanding of the instrument by the market. It has to be understood that complexity is different from credit risk and even an instrument categorized as 'Simple' can carry high levels of risk. For more details, please refer Rating Criteria “Complexity Level Of Financial Instruments” on www.acuite.in.

Rating History

Date	Name of Instruments/Facilities	Term	Amount (Rs. Cr)	Rating/Outlook
06 Sep 2024	Proposed Short Term Bank Facility	Short Term	0.75	ACUITE A4 (Downgraded from ACUITE A4+)
	Cash Credit	Long Term	48.70	ACUITE BB- \| Stable (Downgraded from ACUITE BB \| Stable)
	Term Loan	Long Term	11.00	ACUITE BB- \| Stable (Downgraded from ACUITE BB \| Stable)
	Term Loan	Long Term	0.40	ACUITE BB- \| Stable (Downgraded from ACUITE BB \| Stable)
	Term Loan	Long Term	0.60	ACUITE BB- \| Stable (Downgraded from ACUITE BB \| Stable)
	Term Loan	Long Term	1.24	ACUITE BB- \| Stable (Downgraded from ACUITE BB \| Stable)
13 Jun 2023	Proposed Short Term Bank Facility	Short Term	0.75	ACUITE A4+ (Assigned)
	Term Loan	Long Term	0.40	ACUITE BB \| Stable (Assigned)
	Cash Credit	Long Term	48.70	ACUITE BB \| Stable (Assigned)
	Term Loan	Long Term	11.00	ACUITE BB \| Stable (Assigned)
	Term Loan	Long Term	0.60	ACUITE BB \| Stable (Assigned)
	Term Loan	Long Term	1.24	ACUITE BB \| Stable (Assigned)

Annexure - Details of instruments rated

Lender’s Name	ISIN	Facilities	Date Of Issuance	Coupon Rate	Maturity Date	Quantum (Rs. Cr.)	Complexity Level	Rating
Bank Of Baroda	Not avl. / Not appl.	Cash Credit	Not avl. / Not appl.	Not avl. / Not appl.	Not avl. / Not appl.	48.70	Simple	ACUITE BB- \| Stable \| Reaffirmed
Not Applicable	Not avl. / Not appl.	Proposed Long Term Bank Facility	Not avl. / Not appl.	Not avl. / Not appl.	Not avl. / Not appl.	6.36	Simple	ACUITE BB- \| Stable \| Reaffirmed
Not Applicable	Not avl. / Not appl.	Proposed Short Term Bank Facility	Not avl. / Not appl.	Not avl. / Not appl.	Not avl. / Not appl.	0.75	Simple	ACUITE A4 \| Reaffirmed
SMALL INDUSTRIES DEVELOPMENT BANK OF INDIA	Not avl. / Not appl.	Term Loan	Not avl. / Not appl.	Not avl. / Not appl.	15 Jan 2027	0.23	Simple	ACUITE BB- \| Stable \| Reaffirmed
SMALL INDUSTRIES DEVELOPMENT BANK OF INDIA	Not avl. / Not appl.	Term Loan	Not avl. / Not appl.	Not avl. / Not appl.	31 Jan 2027	0.60	Simple	ACUITE BB- \| Stable \| Reaffirmed
Bank Of Baroda	Not avl. / Not appl.	Term Loan	Not avl. / Not appl.	Not avl. / Not appl.	10 Jan 2027	4.20	Simple	ACUITE BB- \| Stable \| Reaffirmed
SMALL INDUSTRIES DEVELOPMENT BANK OF INDIA	Not avl. / Not appl.	Term Loan	Not avl. / Not appl.	Not avl. / Not appl.	10 Jan 2030	1.85	Simple	ACUITE BB- \| Stable \| Reaffirmed

Contacts

Mohit Jain
Chief Analytical Officer - Rating Operations

Archita Sharma
Associate Analyst - Rating Operations

Contact details exclusively for investors and lenders

Mob: +91 8591310146
Email ID: analyticalsupport@acuite.in

About Acuité Ratings & Research

Acuité is a full-service Credit Rating Agency registered with the Securities & Exchange Board of India (SEBI). The company received RBI Accreditation as an External Credit Assessment Institution (ECAI) for Bank Loan Ratings under BASEL-II norms in the year 2012. Acuité has assigned ratings to various securities, debt instruments and bank facilities of entities spread across the country and across a wide cross section of industries. It has its Registered and Head Office in Kanjurmarg, Mumbai.

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