| Experienced management with long operational track record
Ken Enterprises Limited (KEL) (Erstwhile Ken Enterprises Private Limited), promoted by Mr. Nikunj Hariprasad Bagdiya, Mrs. Bina Hariprasad Bagdiya and Mr. Krishna Hariprasad Bagdiya, have over a decade of experience in the said line of business. The company is the second-generation textile manufacturing enterprise with 40 years of presence in Ichalkaranji, Maharashtra. It is the first weaving mill from Western Maharashtra. The company has international presence in 21 countries for the export of grey fabric. The company exports to USA, Kenya, South Korea, Bangladesh, Thailand, Vietnam, Turkey, Mexico and UAE to name a few. The experience of promoters coupled with long track record of operations has enabled the company to forge healthy relationships with customers and suppliers, which in turn has helped in growth of the business.
Steady growth in revenue amidst moderation in profitability
The group’s operating revenue increased to Rs.639.55 crore in FY26 from Rs.490.29 crore in FY25. The growth in revenue is backed by execution of existing order book, addition of new customers, entry into new markets and stable production capacity. Further, in H1FY27 the group reported revenue of Rs. 392.06 crore as compared to Rs. 272.79 crore in H1FY26. Despite the growth in scale, profitability moderated due to industry-wide pricing pressure and higher input costs. The operating margins and PAT margins stood at 6.16 per cent and 2.41 per cent in FY26 as compared to 6.44 per cent and 2.51 per cent in FY25 respectively. Acuité believes that the group’s operating performance will improve steadily, supported by an expanding customer base and its entry into new markets.
Healthy financial risk profile
The group’s financial risk profile remained healthy with modest net worth, low gearing and comfortable debt protection metrics. The net worth of the group increased to Rs.126.77 crore from Rs.111.44 crore as on March 31, 2025, supported by accretion of profits to reserve. The total debt of the group stood at 53.53 crore as on March 31, 2026, as compared to 35.18 crore as on March 31, 2025. The total debt comprises of Rs. 1.77 crore of long-term debt, Rs. 0.13 crore of USL, Rs. 49.41 crore of short-term borrowings (primarily to fund the higher working-capital requirement associated with business growth) and Rs. 2.22 crore of CPLTD. Although borrowings increased, the gearing remained low at 0.42 times in FY26 as compared to 0.32 times in FY25. Further, the debt protection metrics remained comfortable with Debt Service Coverage Ratio (DSCR) stood at 1.58 times and 1.37 times in FY26 and FY25 respectively. The Interest Coverage Ratio (ICR) also stood comfortable with 2.08 times in FY26 as compared to 2.07 times in FY25. The group’s TOL/TNW deteriorated and stood at 2.08 times and 1.65 times in FY26 and FY25 respectively. The DEBT-EBITDA stood at 1.28 times in FY26 from 1.01 times in FY25.
Board of Directors (BoD) approved the issuance of 39.97 lakh warrants to promoter group entities at Rs. 40.50 per warrant, aggregating to Rs. 16.19 crore. The warrants will be allotted upon receipt of regulatory approvals and are convertible into equity shares within 18 months from the date of allotment. The funds will be infused in phased tranches, with an upfront receipt of Rs. 4.20 crore and the balance Rs. 11.99 crore to be received upon conversion. The proposed fund infusion is expected to strengthen the company's capital structure and support business growth. Acuite believes that the group’s financial risk profile would remain healthy supported by no major debt funded capex and expected equity infusion.
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| Working capital intensive operations
The group’s operations remained working-capital intensive with gross current asset (GCA) of 199 days in FY26 as against 197 days in FY25. The inventory days stood at 95 days and 102 days in FY26 and FY25 respectively. The creditor days are about 140 days in FY26 as compared to 135 days in FY25. The inventory holding is attributable to the 50–60 days production cycle from yarn procurement to finished fabric, while increasing direct and bulk procurement from spinning mills also requires higher stock holding. Further, the debtor days stood at 96 days in FY26 as compared to 85 days in FY25. Further, Fund-based limit utilisation remained high at ~93.69 per cent and non-fund-based limits at 94.48 per cent over last seven months ended September 2026. Acuite believes that the working-capital intensity would remain high on the back of high inventory holding and elevated debtor days.
Susceptibility of profitability to volatility in raw material prices, forex risk in an intensely competitive and fragmented industry
Profit margins are highly susceptible to fluctuations in raw material prices, which are influenced by seasonal factors such as monsoon variations, leading to unpredictable cost structures. Additionally, the competitive landscape is intense due to low entry barriers and a fragmented industry structure, which results in significant pricing pressures from peers. This combination of volatile raw material costs and aggressive competition poses a continuous challenge to maintain stable profit margins for companies engaged in manufacturing. The group is exposed to forex risk as export contributes ~ 19 per cent in total sales.
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