Press Release

Press Release

February 17, 2026

EPIC YARNS PRIVATE LIMITED
Rating Upgraded

Product	Quantum (Rs. Cr)	Long Term Rating	Short Term Rating
Bank Loan Ratings	25.00	ACUITE BBB- \| Stable \| Upgraded	-
Total Outstanding	25.00	-	-
Total Withdrawn	0.00	-	-

Rating Rationale

Acuité has upgraded its long-term rating to ‘ACUITE BBB-’ (read as ACUITE triple B minus) from 'ACUITE BB+' (read as ACUITE double B plus) on the Rs. 25.00 Cr. bank facilities of Epic Yarns Private Limited (EYPL). The outlook is 'Stable'.

Rationale for rating upgrade
The rating upgrade reflects migration from ‘Issuer non cooperative’ status. The rating upgrade also factors in the company's established operational track record, stable operational scale supported by a diversified product mix and moderate financial risk profile marked by improving capital structure on the back of equity infusion. However, the rating remains constrained by moderation in profitability, stretched working-capital cycle and susceptibility of profitability to raw-material price fluctuations and indirect export-market volatility.

About the Company

Epic Yarns Private Limited (EYPL), incorporated on 26 August 2019, is promoted by Mr. Akshat Agrawal and Mr. Aayush Agrawal. The company manufactures and sells a wide range of yarns, including cotton yarn, cotton blends, viscose and viscose blends, linen blends, woven and knitting yarns, as well as specialty variants such as slub and lycra yarns. EYPL currently operates 57,424 spindles at its manufacturing facility and the company is undertaking an expansion project of 14,400 additional spindles, which will increase the total spindle capacity to 71,824 spindles. located at Peth Naka, Islampur, Taluka Walwa, District Sangli, Maharashtra – 415407.

Unsupported Rating

Not Applicable

Analytical Approach

Acuité has considered the standalone business and financial risk profiles of Epic Yarns Private Limited (EYPL) to arrive at the rating.

Key Rating Drivers

Strengths

Experienced management and long operational track record
EYPL is promoted by Mr. Akshat Agrawal and Mr. Aayush Agrawal, who bring strong technical and sectoral expertise to the company’s operations, enabling the development of a diversified product portfolio across linen blends, viscose, modal, mélange and specialty yarns. The company has demonstrated a steady operational track record with 57,424 operational spindles and consistent annual revenues over FY24–FY25. EYPL is currently implementing an expansion of 14,400 new spindles, which will enhance the installed capacity from 8,613.6 TPA to 10,773.6 TPA, adding an incremental ~2,160 TPA post-commissioning. This expansion is expected to strengthen scale, improve operating leverage, and support future growth.

Moderate financial risk profile
EYPL’s financial risk profile is moderate, supported by an improved net worth and comfortable gearing and coverage indicators. The tangible net worth increase to Rs. 54.92 crore in FY25 from Rs. 21.59 crore in FY24, driven by equity infusion and profit accretion. Total debt stood at Rs. 54.13 crore in FY2025 (comprising long-term borrowings of Rs. 8.74 crore, unsecured loans from promoters of Rs. 25.35 crore, short-term borrowings of Rs. 19.69 crore, and CPLTD of Rs. 2.14 crore), broadly in line with Rs. 49.60 crore in FY2024. Consequently, gearing improved to 0.99x in FY2025 from 2.30x in FY2024. The TOL/TNW ratio improved to 2.51x in FY2025 from 5.66x in FY2024, supported by higher net worth Debt-protection metrics remain adequate, with interest coverage ratio (ICR) at 4.34x and debt service coverage ratio (DSCR) at 3.36x in FY25, though moderated from 32.84x and 15.04x respectively in FY24 due to higher interest costs. The TOL/TNW improved to 2.51x in FY25 from 5.66x in FY24, reflecting the strengthened capital structure, while the Debt/EBITDA improved to 3.22x in FY25 from 4.73x in FY24. Acuite believes that the financial risk profile of the company is likely to improve in the near to medium term on account of likely improvement in the scale of operations and no debt funded capital expenditure.

Weaknesses

Stable scale of operations albeit moderation in profitability
EYPL registered steady year-on-year growth in FY2025, with total revenues increasing to Rs. 143.49 crore from Rs. 130.35 crore in FY2024, supported by marginal improvement in sales volume and better realizations. However, despite the rise in topline, profitability moderated over the same period, with EBITDA declining to Rs. 9.74 crore in FY25 from Rs. 10.16 crore in FY24, reflecting margin contraction primarily due to elevated raw-material costs and higher finance charges. PAT also reduced to Rs. 5.69 crore in FY25 compared to Rs. 6.18 crore in FY24, further evidencing pressure on bottom-line performance. The company reported a total operating income of Rs. 81.50 crore during 9M FY26 and achieved a PAT of Rs. 7.05 crore, aided in part by significant non-operating income. EYPL’s profitability profile remains sensitive to volatility in imported fibre prices, demand fluctuations among export-oriented customer segments, and inherent competitive intensity of the yarn manufacturing industry.

Intensive working capital operations
EYPL’s operations remain working-capital intensive, reflected in gross current assets (GCA) days rising to 258 days in FY25, up from 171 days in FY24. The elongation is driven by elevated inventory and receivable levels across both years. Inventory days increased from 122(FY24) to 159(FY25), primarily beacuse EYPL's suppliers who imports linen fibre faced extended import lead time and supply-chain disruptions, which compelled the company to maintain higher buffer stock. Debtor days also rose sharply from 9(FY24) to 55(FY25), as the company reports gross receivables without netting off customer advances, thereby inflating the reported debtor position. Conversely, the creditor period improved to 106 days in FY25 from 89 days in FY24, providing partial support to the working-capital cycle. However, fund-based limits remained nearly fully utilised, with average utilisation at ~99.6% for the 12 months ending December 2025. Acuité believes the company’s working-capital cycle is likely to remain intensive in the near term given the prevailing operational dynamics.

Highly competitive textile industry and susceptibility of profits to the fluctuations in the raw material prices
The textile industry in India is highly fragmented and competitive marked by the presence of a large number of organised and unorganised players. The company is exposed to intense competition from both domestic players as well as established players in the overseas market. The shifts in consumption patterns may have an impact on the operations of the company. The company maintains a 2-3 month stock of cotton and linen to mitigate the effects of price fluctuations.

Rating Sensitivities

Sustained improvement in scale of operations while maintaining profitability
Elongation in working capital operations leading to stretch in liquidity position
Changes in financial risk profile

Liquidity Position:

Stretched

The company’s liquidity position is stretched, though supported by adequate net cash accruals to meet repayment obligations. During FY2025, EYPL generated NCAs of Rs. 10.00 crore against maturing debt of Rs. 0.26 crore. The current ratio stood at 1.01x as on March 31, 2025, reflecting limited short-term liquidity. Working-capital utilisation remained high, with average fund-based limit utilisation at ~99.6% over the last 12 months ended December 2025. GCA days elongated to 258 days in FY25, from 171 days in FY24. As on March 31, 2025, the company maintained unencumbered cash balance of Rs. 0.12 crore.

Outlook: Stable

Other Factors affecting Rating

None

Key Financials

Particulars	Unit	FY 25 (Actual)	FY 24 (Actual)
Operating Income	Rs. Cr.	143.49	130.35
PAT	Rs. Cr.	5.69	6.18
PAT Margin	(%)	3.96	4.74
Total Debt/Tangible Net Worth	Times	0.99	2.30
PBDIT/Interest	Times	4.34	32.84

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
22 Sep 2025	Proposed Cash Credit	Long Term	25.00	ACUITE BB+ (Downgraded & Issuer not co-operating* from ACUITE BBB- \| Stable)
01 Jul 2024	Proposed Cash Credit	Long Term	25.00	ACUITE BBB- \| 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
State Bank of India	Not avl. / Not appl.	Cash Credit	06 Jul 2025	Not avl. / Not appl.	Not avl. / Not appl.	22.00	Simple	ACUITE BBB- \| Stable \| Upgraded ( from ACUITE BB+ )
Not Applicable	Not avl. / Not appl.	Proposed Cash Credit	Not avl. / Not appl.	Not avl. / Not appl.	Not avl. / Not appl.	3.00	Simple	ACUITE BBB- \| Stable \| Upgraded ( from ACUITE BB+ )

Contacts

Mohit Jain
Chief Analytical Officer - Rating Operations

Dharmavarapu Sai Kiran
Senior 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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