Product Quantum (Rs. Cr) (SEBI) Quantum (Rs. Cr) (Other FSR) Long Term Rating Short Term Rating Regulated By
Bank Loan Ratings 0.00 36.00 ACUITE BBB+ | Stable | Upgraded - RBI
Bank Loan Ratings 0.00 13.56 Not Applicable | Withdrawn - RBI
Bank Loan Ratings 0.00 23.00 - ACUITE A2+ | Upgraded RBI
Total Outstanding 0.00 59.00 - - -
Total Withdrawn 0.00 13.56 - - -
Note:- For activities or ratings of instruments falling under the purview of Financial Sector Regulators other than SEBI, the grievance / dispute redressal mechanisms and investor protection mechanisms provided by SEBI shall not be available.
 
Rating Rationale

Acuité has upgraded its long-term rating to ‘ACUITE BBB+’ (read as ACUITE triple B plus) from ‘ACUITE BBB’ (read as ACUITE triple B) and short term rating to ‘ACUITE A2+’ (read as ACUITE A two plus) from 'ACUITE A3+' (read as ACUITE A three plus) on the Rs. 59.00 crore bank facilities of Shree Ram Twistex Limited (SRTL). The outlook is ‘Stable’.

Acuité has withdrawn its long-term bank facilities on the Rs. 5.70 crore bank facilities of Shree Ram Twistex Limited (SRTL) without assigning any rating as the instrument is fully repaid. The rating is being withdrawn on account of the request received from the issuer and No Due Certificate (NDC) received from the banker. 
Acuite has also withdrawn its proposed long-term bank facilities of Rs. 7.86 Cr. without assigning any rating as it is a proposed facility bank facilities of Shree Ram Twistex Limited (SRTL). The rating has been withdrawn on account of the request received from the issuer.

The rating withdrawal is in accordance with the Acuite’s policy on withdrawal of rating as applicable to the respective facility / instrument.

Rationale of Rating upgrade
The rating upgrade is primarily driven by capital infusion through its IPO, prepayment of debt and improved operating performance. The company successfully raised Rs. 110.24 crore through its initial public offering (IPO) strengthened the capital structure, aiding in an improving liquidity and financial risk profile. The upgrade also takes comfort from the company’s experienced management and long-established operational track record, above average financial risk profile and adequate liquidity position. However, the rating remains constrained by the company’s working capital intensive operations and susceptibility of profitability to volatility in raw material prices in a highly fragmented and competitive textile industry.

About the Company

Incorporated in 2013, Gujarat-based Shree Ram Twistex Limited (SRTL) is engaged in the manufacturing of cotton yarn in the count range of 30s to 60s, which is primarily used in denim, shirting, suiting and undergarment fabrics. The company commenced commercial operations in 2016 and is promoted by Mr. B. B. Ramani, Mr. Kothari, Mr. Hirani, Mr. Tilala and Mr. J. V. Ramani. SRTL operates a spinning facility at Gondal, near Rajkot (Gujarat) with an installed capacity of 28,000 spindles.
 
Unsupported Rating

­Not Applicable
 
Analytical Approach

­Acuite has considered the standalone business and financial risk profile of Shree Ram Twistex Limited (SRTL) to arrive at the rating.

 
Key Rating Drivers

Strengths

Experienced management and established relationships with its clientele
The company benefits from the extensive experience of its promoters and directors, who possess expertise across cotton ginning and spinning, ceramics, and construction-related businesses. Over the years, the company has developed good relationships with its customers and suppliers, supported by its location in Gondal, Gujarat, which ensures access to quality raw materials and skilled labour. Acuite believes that the promoters' experience and established market presence will continue to support the company's business profile over the medium term.

Improvement in operating performance albeit modest scale of operations
The company's operating income improved steadily and stood at Rs. 273.51 crore in FY26 as against Rs. 253.86 crore in FY25. The increase in revenue during FY26 was driven by strong demand for yarn despite fluctuating cotton rates. SRTL reported revenue of Rs. 177.96 crore for 5MFY27 as against Rs. 103.40 crore in 5MFY26, thus expected to improve scale of operations in the medium to long term. The operating profit margin of the company improved and stood at 12.25 per cent in FY26 as against 8.68 per cent in FY25, driven by higher realization from value-added yarn products, improved product mix and better absorption of overhead costs. The net profit margin of the company improved to 5.18 per cent in FY26 compared to 3.15 per cent in FY25. The profitability is expected to improve with a significant reduction in power consumption cost, as it has initiated a 6.1 MW ground-mounted solar power plant in addition to the previously established 1.2 MW rooftop solar power project. Acuite believes that the operating performance of the company would improve steadily in the medium term on the back of stable demand and cost control initiatives.

Above average Financial Risk Profile, improved significantly on the back of infusion of equity and prepayment of debt
The company has a above average financial risk profile marked by moderate but improved net worth, low gearing and comfortable debt protection metrics. SRTL’s net-worth improved and stood at Rs. 179.75 crore in FY26 against Rs. 54.59 crore as on FY25 on account of accretion of profits to reserves and issue of equity capital through IPO. The company successfully completed its IPO during FY26 and was listed on the BSE and NSE with effect from March 02, 2026. The company allotted 1.06 crore equity shares of face value Rs. 10 each at an issue price of Rs. 110 per share (including share premium of Rs. 94.00 per share, aggregating to Rs. 110.24 crore. The company’s total debt as on March 31,2026 stood at Rs. 30.20 crore as compared to Rs. 62.48 crore as on March 31, 2025; comprising of long-term debt of Rs. 3.75 crore, short-term debt of Rs. 14.17 crore and Unsecured loans from promoters/directors of Rs. 6.88 crore and maturing debt repayment obligations of Rs. 5.40 crore. The company’s gearing (Debt-equity) improved and stood at 0.17 times as on March 31,2026 as against 1.14 times on March 31, 2025. The Total Outside Liabilities/Tangible Net Worth (TOL/TNW) stood at 0.61 times as on March 31, 2026 as against 2.20 times as on March 31, 2025. The interest coverage ratio (ICR) of the company stood at 3.81 times in FY26 against 3.25 times in FY25. Debt service coverage ratio (DSCR) stood at 1.99 times in FY2026 against 1.86 times in FY25. The DEBT-EBITDA stood at 0.89 times as on 31st March 2026 against 2.82 times as on 31st March 2025. Net Cash Accruals/Total Debt (NCA/TD) stood moderate at 0.75 times as on March 31, 2026. The improvement is attributed to infusion of capital and prepayment of long-term debt.

The company has completed the installation of a 6.1 MW solar power plant for captive consumption in Sep 26, with a project cost of Rs. 22.24 crore, funded through own funds. In addition, the company is undertaking the installation of a 4.2 MW wind power plant for captive use at a cost of Rs. 25.11 crore which will be funded through IPO proceeds. Further, the company has machinery expansion and technological upgradation of its spinning division for the cost of Rs. Rs. 5.26 crore which will be funded through internal accruals. The benefits from these investments are expected to accrue from H2FY27, with the full impact likely to be reflected from FY28 onwards which will help cost savings. Acuite believes, that the financial risk profile of the company would remain above average in the medium term due to steady accruals and no major debt funded capex plans.


Weaknesses

Working capital intensive operations
The company’s operations remained working capital intensive, as reflected in its elevated gross current assets (GCA) of 292 days in FY26 as against 156 days in FY25. This was primarily due to significant rise in inventory holding, which stood at 223 days in FY26 compared to 101 days in FY25. The higher inventory levels were on account of the company's strategic stocking of cotton bales to mitigate the impact of anticipated increases in cotton prices and ensure uninterrupted availability of raw materials. The debtor period, however, improved to 20 days in FY26 from 46 days in FY25, indicating efficient collection mechanisms and disciplined credit management despite an average credit period of around 45 days offered to customers.  The company caters to a diversified customer base and offers a wide range of yarn variants to meet varying customer requirements across colours, counts, textures, and finishes. Creditor days remained largely stable at 122 days in FY26 as against 76 days in FY25, while the average credit period available from suppliers ranges between 60-90 days. Further, the company's reliance on bank working capital limits remained moderate, with average fund-based working capital utilisation of ~65.65 percent during the eight months ended August 2026. Acuite believes, that the working capital operations of the company will remain intensive over the medium term due to high inventory holding requirements.

Susceptibility of profitability to volatility in raw material prices in an intensely competitive and fragmented textile industry
The Indian textile industry is highly fragmented and competitive marked by presence of large number of organized and unorganized players. This restricts the pricing flexibility and bargaining power with its customers. Further, the operating margins are fluctuating due to the volatility in pricing of raw materials. However, the promoters’ long-established presence in the field shall enable them to pass the volatility in raw material process to its customers, further reducing the risk to a certain extent.

Rating Sensitivities

Potential triggers (individual or collective) for an upward rating action:
­
  • Significant improvement in scale of operations and profitability margins with revenues surpassing Rs. 600.00 Cr
  • Improvement in working capital operations
  • Maintaining healthy financial risk profile
Potential triggers (individual or collective) for a downward rating action:
­
  • Significant decline in operating performance with NCA falling below Rs. 13.00 Cr. consistently
  • Elongation in working capital cycle, impacting liquidity and increasing dependence on external funding.
  • Deterioration in financial risk profile with unexpected addition of debt
Liquidity Position
Adequate
The company’s liquidity is adequate marked by sufficient net cash accruals against its repayment debt obligations. The net cash accruals (NCAs) stood at Rs. 22.74 Cr. in FY2026 as against long term debt repayment of Rs. 7.00 Cr. during the same period. The company is expected to generate net cash accruals in the range of Rs. 29.00-36.00 Crore in FY27-28 against it its repayment obligation of Rs. 1.00-6.00 crore during the same period. The cash and bank balances stood at Rs. 34.27 Cr. as on March 31, 2026 as compared to Rs. 0.42 Cr. as on March 31,2025. The current ratio stood at 2.32 times as on March 31, 2026 as compared to 1.39 times as on March 31,2025. The average bank limit utilization stood at 65.65 percent over the last eight months ended, August 2026.
Acuite believes that going forward the liquidity position of the firm will remain adequate in the near to medium term on account of steady cash accruals and,  moderate bank limit utilisation.
 
Outlook
­Stable
 
Other Factors affecting Rating
­None
 

Particulars Unit FY 26 (Actual) FY 25 (Actual)
Operating Income Rs. Cr. 273.51 253.86
PAT Rs. Cr. 14.17 8.00
PAT Margin (%) 5.18 3.15
Total Debt/Tangible Net Worth Times 0.17 1.14
PBDIT/Interest Times 3.81 3.25
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

Date Name of Instruments/Facilities Term Amount (Rs. Cr) Rating/Outlook
29 Aug 2025 Warehouse Receipt Financing Short Term 11.42 ACUITE A3+ (Reaffirmed)
Warehouse Receipt Financing Short Term 8.58 ACUITE A3+ (Reaffirmed)
Bank Guarantee (BLR) Short Term 3.00 ACUITE A3+ (Reaffirmed)
Term Loan Long Term 5.70 ACUITE BBB | Stable (Reaffirmed)
Proposed Long Term Bank Facility Long Term 10.95 ACUITE BBB | Stable (Reaffirmed)
Term Loan Long Term 16.91 ACUITE BBB | Stable (Reaffirmed)
Cash Credit Long Term 16.00 ACUITE BBB | Stable (Reaffirmed)
06 Aug 2024 Bank Guarantee (BLR) Short Term 3.00 ACUITE A3+ (Reaffirmed)
Warehouse Receipt Financing Short Term 8.58 ACUITE A3+ (Assigned)
Warehouse Receipt Financing Short Term 11.42 ACUITE A3+ (Reaffirmed)
Term Loan Long Term 16.91 ACUITE BBB | Stable (Reaffirmed)
Term Loan Long Term 2.93 ACUITE BBB | Stable (Reaffirmed)
Cash Credit Long Term 16.00 ACUITE BBB | Stable (Reaffirmed)
Working Capital Term Loan Long Term 1.19 ACUITE BBB | Stable (Reaffirmed)
Proposed Long Term Bank Facility Long Term 6.83 ACUITE BBB | Stable (Reaffirmed)
Term Loan Long Term 5.70 ACUITE BBB | Stable (Assigned)
08 Sep 2023 Bank Guarantee (BLR) Short Term 3.00 ACUITE A3+ (Reaffirmed)
Term Loan Long Term 17.55 ACUITE BBB | Stable (Reaffirmed)
Term Loan Long Term 5.03 ACUITE BBB | Stable (Reaffirmed)
Cash Credit Long Term 16.00 ACUITE BBB | Stable (Reaffirmed)
Working Capital Term Loan Long Term 1.95 ACUITE BBB | Stable (Reaffirmed)
Proposed Long Term Bank Facility Long Term 14.75 ACUITE BBB | Stable (Reaffirmed)
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Lender’s Name ISIN Facilities Listing Status Regulated By Date Of Issuance Coupon Rate Maturity Date Quantum
(Rs. Cr.)		 Complexity Level Rating
State Bank of India Not avl. / Not appl. Bank Guarantee (BLR) Unlisted RBI Not avl. / Not appl. Not avl. / Not appl. Not avl. / Not appl. 3.00 Simple ACUITE A2+ | Upgraded ( from ACUITE A3+ )
State Bank of India Not avl. / Not appl. Cash Credit Unlisted RBI Not avl. / Not appl. Not avl. / Not appl. Not avl. / Not appl. 36.00 Simple ACUITE BBB+ | Stable | Upgraded ( from ACUITE BBB )
Not Applicable Not avl. / Not appl. Proposed Long Term Bank Facility Unlisted RBI Not avl. / Not appl. Not avl. / Not appl. Not avl. / Not appl. 7.86 Simple ACUITE Not Applicable | Withdrawn
SMALL INDUSTRIES DEVELOPMENT BANK OF INDIA Not avl. / Not appl. Term Loan Unlisted RBI 10 Jul 2024 Not avl. / Not appl. 10 Dec 2028 5.70 Simple ACUITE Not Applicable | Withdrawn
AXIS BANK LIMITED Not avl. / Not appl. Warehouse Receipt Financing Unlisted RBI Not avl. / Not appl. Not avl. / Not appl. Not avl. / Not appl. 8.58 Simple ACUITE A2+ | Upgraded ( from ACUITE A3+ )
AXIS BANK LIMITED Not avl. / Not appl. Warehouse Receipt Financing Unlisted RBI Not avl. / Not appl. Not avl. / Not appl. Not avl. / Not appl. 11.42 Simple ACUITE A2+ | Upgraded ( from ACUITE A3+ )
Note:- For activities or ratings of instruments falling under the purview of Financial Sector Regulators other than SEBI, the grievance / dispute redressal mechanisms and investor protection mechanisms provided by SEBI shall not be available.
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