Press Release

Press Release

March 13, 2026

SAI RADHA PHARMA INDIA PRIVATE LIMITED
Rating Upgraded

Product	Quantum (Rs. Cr)	Long Term Rating	Short Term Rating
Bank Loan Ratings	40.83	ACUITE BB+ \| Stable \| Upgraded	-
Total Outstanding	40.83	-	-
Total Withdrawn	0.00	-	-

Rating Rationale

Acuité has upgraded its long-term rating to 'ACUITE BB+' (read as ACUITE double B plus) from 'ACUITE BB' (read as ACUITE double B) on the Rs.40.83 Cr. bank facilities of Sai Radha Pharma India Private Limited(SRPIPL). The outlook is ‘Stable’.

Rationale for Rating

The rating upgradation reflects migration of the issuer from ‘Issuer non-cooperative status’. The rating also factors in the steady operating performance of SRPIPL, supported by moderate growth in scale of operations and stable demand across its retail and wholesale segments. While margins have moderated due to higher operating expenses, profitability remains adequate for the scale of business. The rating continues to draw comfort from the company’s experienced management and long operational track record. However, the rating is constrained by the company’s moderate financial risk profile, driven by modest net worth base and average coverage indictors and moderately intensive working capital operations with high utilisation of working capital limits. The rating is also constrained by, the inherently fragmented and regulated nature of the pharmaceutical distribution industry, which limits pricing flexibility and keeps margins under pressure. The rating also factors the company’s exposure to competitive intensity within the regional pharmaceutical retail and wholesale market.

About the Company

Sai Radha Pharma India Private Limited (SRPIPL) was incorporated in 2011 and is based out of Karnataka. The company is engaged in the retail and wholesale distribution of pharmaceutical products. The Sai Radha Group has presence in pharmaceutical distribution since 1989 through a retail store operated under a partnership firm Radha Medicals and General Stores. In 2007, the Sai Radha Group ventured into wholesale distribution business through acquisition of Panchavati Pharma. The current director of the firm are Mr. Manohar Shetty, Mrs. Anuradha Shetty and Mr. Sharanam Shetty. The registered office is in Karnataka. The wholesale segment caters to retail medical stores, hospital and doctors in and around Udupi, Mangalore, Manipal and nearby regions. Some of its major suppliers include Abbotts, Intas, Cipla, Zydus, Ranbaxy, Novartis, German Remedies, and Mankind etc. among others. The company is the official stockist for 175 plus companies. The company also have 55000 plus active products which includes allopathic, ayurvedic, homeopathic, generic medicine, general, cosmetics, veterinary, gen next, dental and surgical equipment.

Unsupported Rating

Not Applicable

Analytical Approach

Acuite has considered the standalone business and financial risk profile of Sai Radha Pharma India Private Limited (SRPIPL) to arrive at the rating.

Key Rating Drivers

Strengths

Experience management
The promoter, Mr. Manohar Shetty started a retail pharmacy shop in Udupi in 1987. The Sai Radha Group has presence in pharmaceutical distribution since 1987 through a retail store operated under a partnership firm Radha Medicals and General Stores. In 2007, the Sai Radha Group ventured into wholesale distribution business through acquisition of Panchavati Product Pharma. With a view to consolidate the entire pharmaceutical distribution business under one company, Mr. Manohar Shetty started SRPIPL in January 2012. Currently, SRPIPL has total of seven retails outlets and two wholesale outlets in the coastal region of Karnataka.

Stable operating performance
The company reported improvement in revenue which stood at Rs. 234.44 Cr. in FY25 as against Rs. 209.62 Cr. in FY24. The improvement is on account of the increase in supply and stable operations in the retail outlets. EBITDA margins marginally declined to 4.69 per cent from 5.39 per cent in FY25 and FY24 respectively. The decline in margin is due to increase in employee cost (rise in contribution towards PF), administrative expenses and selling expenses. Further PAT margins stood stable at 2.02 per cent in FY25 and 2.09 per cent in FY24.
Till 10M FY26 the company has booked revenue worth Rs. 241.54 Cr. with EBITDA and PAT at 6.04 per cent and 3.22 per cent respectively. Acuité believes that profitability of SRPIPL will improve in medium term on account of improving operations.

Average Financial Risk Profile
The financial risk profile of the company stood average, marked by modest net worth, low gearing (debt-equity) and above average debt protection metrics. The tangible net worth stood at Rs. 30.52 Cr. as on 31 March 2025 as against Rs. 25.79 Cr. as on 31 March 2024 on account of accretion of profits to reserves. The total debt of the company stood at Rs. 29.85 Cr. as on 31 March 2025 which includes long-term debt of Rs. 2.21 Cr, short-term debt of Rs. 25.54 Cr, CPLTD of Rs. 1.79 Cr. and unsecured loans of Rs. 0.32 Cr. The gearing (debt/equity) stood low at 0.98 times as on 31 March 2025 as compared to 1.23 times as on 31 March 2024. Interest Coverage Ratio stood at 3.16 times in FY25 as against 2.80 times for FY2024. Debt Service Coverage Ratio (DSCR) stood at 1.34 times in FY2025 as compared to 1.19 times in FY2024. Total outside Liabilities/Total Net Worth (TOL/TNW) stood at 1.65 times as on 31 March 2025 as against 1.99 times as on 31 March 2025. Net Cash Accruals to Total Debt (NCA/TD) stood at 0.20 times for FY2025 as against 0.19 times for FY2024. Acuité believes that the company’s financial risk profile is expected to remain average on account of modest net worth steady accruals generation and no major debt funded capex.

Weaknesses

Moderately intensive working capital operations
The company has a moderately intensive working capital cycle marked by Gross Current Assets (GCA) of 90 days as on March 31, 2025 as against 97 days on March 31, 2024. The creditor days stood at 23 days in FY25 as against 26 days in FY24. The receivable days stood average of 18 days in FY25 as compared to 17 days in FY24. The inventory days stood at 43 days as on March 31, 2025 as against 46 days as on March 31, 2024. Further, the bank limit utilization stood high at 93.06 per cent for six months ending January 2026.

Fragmented nature of industry and high regulatory intervention limits pricing flexibility
Given the highly fragmented nature of the pharmaceutical distribution business, the company’s pricing flexibility is limited. Besides, SRPIPL’s operations are also exposed to changes in regulatory policy pertaining to pharmaceutical industry.

Rating Sensitivities

Potential triggers (individual or collective) for an upward rating action:

Sustained growth in revenue and profitability on a consistent basis.
Improvement in coverage indicators to above three times

Potential triggers (individual or collective) for a downward rating action:

Elongation in the working capital cycle, leading to CGA days exceeding 120 days
Sustained decline in EBITDA margins to below 3 per cent.

Liquidity Position

Adequate

The company’s liquidity position is adequate, marked by adequate net cash accruals against the maturing debt obligations. The company generated sufficient net cash accruals of Rs. 5.98 Cr. in FY2025 against Rs. 3.57 Cr repayment obligation of during the same period. The working capital management of the company is efficient marked by GCA days of 90 days in FY2025 as against 97 days in FY2024 leading to high reliance on working capital limits with average fund-based limit utilisation of ~ 93 per cent. The current ratio stands at 1.34 times as on March 31, 2025, as against 1.27 times as on 31 March 2024. The cash balance stood at Rs. 1.15 Cr. as on March 31 2025.

Acuite believes that the liquidity position is expected to remain adequate on the back of repayment of long-term debt vis a vis steady cash accrual.

Outlook: Stable

Other Factors affecting Rating

None

Key Financials

Particulars	Unit	FY 25 (Actual)	FY 24 (Actual)
Operating Income	Rs. Cr.	234.44	209.62
PAT	Rs. Cr.	4.73	4.38
PAT Margin	(%)	2.02	2.09
Total Debt/Tangible Net Worth	Times	0.98	1.23
PBDIT/Interest	Times	3.16	2.80

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
• Application Of Financial Ratios And Adjustments: https://www.acuite.in/view-rating-criteria-53.htm
• Trading Entities: https://www.acuite.in/view-rating-criteria-61.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
13 Dec 2024	Cash Credit	Long Term	26.50	ACUITE BB (Downgraded & Issuer not co-operating* from ACUITE BB+ \| Stable)
	Term Loan	Long Term	1.69	ACUITE BB (Downgraded & Issuer not co-operating* from ACUITE BB+ \| Stable)
	Term Loan	Long Term	2.84	ACUITE BB (Downgraded & Issuer not co-operating* from ACUITE BB+ \| Stable)
	Term Loan	Long Term	3.50	ACUITE BB (Downgraded & Issuer not co-operating* from ACUITE BB+ \| Stable)
	Term Loan	Long Term	1.65	ACUITE BB (Downgraded & Issuer not co-operating* from ACUITE BB+ \| Stable)
	Proposed Long Term Bank Facility	Long Term	4.27	ACUITE BB (Downgraded & Issuer not co-operating* from ACUITE BB+ \| Stable)
	Term Loan	Long Term	0.38	ACUITE BB (Downgraded & Issuer not co-operating* from ACUITE BB+ \| Stable)
25 Sep 2023	Cash Credit	Long Term	26.50	ACUITE BB+ \| Stable (Reaffirmed)
	Term Loan	Long Term	1.69	ACUITE BB+ \| Stable (Reaffirmed)
	Term Loan	Long Term	2.84	ACUITE BB+ \| Stable (Reaffirmed)
	Term Loan	Long Term	3.50	ACUITE BB+ \| Stable (Reaffirmed)
	Term Loan	Long Term	1.65	ACUITE BB+ \| Stable (Reaffirmed)
	Proposed Long Term Bank Facility	Long Term	4.27	ACUITE BB+ \| Stable (Reaffirmed)
	Term Loan	Long Term	0.38	ACUITE BB+ \| Stable (Reaffirmed)

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	08 Feb 2017	Not avl. / Not appl.	Not avl. / Not appl.	17.50	Simple	ACUITE BB+ \| Stable \| Upgraded ( from ACUITE BB )
Bank Of Baroda	Not avl. / Not appl.	Cash Credit	13 Dec 2018	Not avl. / Not appl.	Not avl. / Not appl.	9.00	Simple	ACUITE BB+ \| Stable \| Upgraded ( from ACUITE BB )
Not Applicable	Not avl. / Not appl.	Proposed Long Term Bank Facility	Not avl. / Not appl.	Not avl. / Not appl.	Not avl. / Not appl.	8.08	Simple	ACUITE BB+ \| Stable \| Upgraded ( from ACUITE BB )
Bank Of Baroda	Not avl. / Not appl.	Term Loan	30 Dec 2024	Not avl. / Not appl.	30 Dec 2027	1.06	Simple	ACUITE BB+ \| Stable \| Upgraded ( from ACUITE BB )
Bank Of Baroda	Not avl. / Not appl.	Term Loan	21 Oct 2022	Not avl. / Not appl.	21 Oct 2029	1.69	Simple	ACUITE BB+ \| Stable \| Upgraded ( from ACUITE BB )
Bank Of Baroda	Not avl. / Not appl.	Term Loan	09 Dec 2021	Not avl. / Not appl.	09 Dec 2026	3.50	Simple	ACUITE BB+ \| Stable \| Upgraded ( from ACUITE BB )

Contacts

Mohit Jain
Chief Analytical Officer - Rating Operations

Anuja Bele
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.

Disclaimer: An Acuité rating does not constitute an audit of the rated entity and should not be treated as a recommendation or opinion that is intended to substitute for a financial adviser's or investor's independent assessment of whether to buy, sell or hold any security. Ratings assigned by Acuité are based on the data and information provided by the issuer and obtained from other reliable sources. Although reasonable care has been taken to ensure that the data and information is true, Acuité, in particular, makes no representation or warranty, expressed or implied with respect to the adequacy, accuracy or completeness of the information relied upon. Acuité is not responsible for any errors or omissions and especially states that it has no financial liability whatsoever for any direct, indirect or consequential loss of any kind, arising from the use of its ratings. Ratings assigned by Acuité are subject to a process of surveillance which may lead to a revision in ratings as and when the circumstances so warrant. Please visit our website (www.acuite.in) for the latest information on any instrument rated by Acuité. Please visit https://www.acuite.in/faqs.htm to refer FAQs on Credit Rating.

Note: None of the Directors on the Board of Acuité Ratings & Research Limited are members of any rating committee and therefore do not participate in discussions regarding the rating of any entity.