Long track record and established relations with Proctor & Gamble
SDPL has an established track record of over two decades in the FMCG sector as a distributor. The company is promoted by Mr. Padmanabhapillai Krishnarajan Rajan, who has extensive experience spanning more than two decades in the FMCG industry, resulting in long-standing relationships with many of the key personnel at P&G throughout India. The senior management team is ably supported by a strong line of mid-level managers. The extensive experience of the promoters is reflected in their established relationships with customers and suppliers. The company covers 1,10,000+ customers, and the key customers of the company include reputed names like Lulu, More Retail Limited, Lachmandas Trading Company, Bismi Hypermart Private Ltd, Pothys, Dhanya Consumers Pvt. Ltd and Spencer’s Retail Limited, amongst others, with no major concentration in revenues. Further, the company has been the sole distributor of Procter & Gamble (P&G) products in the state of Kerala for the past two decades. It expanded its operations into Tamil Nadu by taking over the P&G distribution in four districts: Coimbatore, Nilgiris, Erode, and Tiruppur, with effect from April 2021. The company also started new Brittania branches at Ernakulam (as of November 2021) and Kotayam (as of April 2022). Acuité believes that SDPL’s business risk profile would improve on the back of industry experience and domain knowledge of the management, geographical reach, and established relationships with the principal.

Steady operating performance
The operating income of the company stood at Rs. 1,267.65 Cr. in FY2025 (prov.) as against Rs. 1,224.76 Cr. in FY2024. Further, it is estimated to achieve a revenue of Rs. 1,302.97 Cr. in FY2026. Profitability margin i.e. EBITDA margin stood at 1.22 per cent in FY2025 (prov.) as against 1.21 per cent in FY2024. Further, Net Profit margin remained thin at 0.51 per cent in FY2025 (Prov.) as against 0.54 per cent in FY2024. Acuité believes that the operating performance of the company would remain steady on the back of stable business risk profile.

Efficient Working capital management
SDPL manages its working capital efficiently as reflected in its gross current assets (GCA) days of 43 days as on March 31, 2025 (Prov.), as against 39 days as on March 31, 2024. Inventory days stood at 17 days as on March 31, 2025 (Prov.), as against 15 days as on March 31, 2024. The debtor day stood at 20 days as on March 31, 2025 (Prov.), as against 19 days as on March 31, 2024. Subsequently, the payable period stood at 15 days as on March 31, 2025 (Prov.), as against 14 days as on March 31, 2024, respectively. Further, the average bank limit utilization in the last six months ended July 2025 remained at ~84 per cent for fund based. Acuité believes that the working capital operations of the company will remain efficient due to efficient collection mechanism and just in time inventory levels.
 

Moderate financial risk profile
The financial risk profile of the company has remained moderate with moderate net worth, capital structure and moderate gearing, comfortable debt protection metrics. The net worth of the company improved and stood at Rs.54.07 Cr. and Rs.47.66 Cr. as on March 31, 2025 (Prov.) and 2024 respectively.  The gearing of the company stood at 1.03 times as on March 31, 2025 (Prov.), against 1.08 times as on March 31, 2024. Debt protection metrics – Interest coverage ratio (ICR) and debt service coverage ratio (DSCR) stood at 2.34 times and 1.12 times as on March 31, 2025 (Prov.), respectively as against 2.50 times and 1.58 times as on March 31, 2024, respectively. The debt to EBITDA of the company stood at 3.50 times as on March 31, 2025 (Prov.), as against 3.36 times as on March 31, 2024. NCA /TD stood at 0.14 as on March 31, 2025 (Prov.), as against 0.15 times as on March 31, 2024. Acuite believes, that the financial risk profile of SDPL will continue to remain moderate over the medium term.

Principal concentration risk
The company is exposed to principal concentration risk, with over 84 per cent of procurement in FY 2025 coming from a single principal, P&G and rest from Britannia as company is having exclusive distributorship for them, such dependency can pose challenges if supply chain disruptions or pricing changes occur. However, the risk is mitigated to an extent as company is having long standing relations of over two decades with P&G and over 3 years with Brittania.