Press Release

Press Release

January 14, 2025

THENI GURU KRISHNA TEXTILE MILLS PRIVATE LIMITED
Rating Assigned and Downgraded

Product	Quantum (Rs. Cr)	Long Term Rating	Short Term Rating
Bank Loan Ratings	30.00	ACUITE C \| Assigned	-
Bank Loan Ratings	276.96	ACUITE C \| Downgraded	-
Bank Loan Ratings	2.04	ACUITE D \| Downgraded	-
Bank Loan Ratings	25.00	-	ACUITE A4 \| Downgraded
Total Outstanding	334.00	-	-
Total Withdrawn	0.00	-	-

Rating Rationale

Acuite has downgraded its long-term rating to ACUITE D’ (read as ACUITE D) from ‘ACUITE BBB’ (read as ACUITE Triple B) on the Rs. 2.04 Cr. bank facilities of Theni Guru Krishna Textile Mills Private Limited (TGKTMPL).
Further, Acuite has downgraded its long-term rating to ‘ACUITE C (read as ACUITE C)’ from ‘ACUITE BBB (read as ACUITE triple B)’ on the Rs. 276.96 Cr. bank facilities and short-term rating to ‘ACUITE A4 (read as ACUITE A four)’ from ‘ACUITE A3+ (read as ACUITE A three plus) on the Rs. 25.00 Cr. bank facilities of Theni Guru Krishna Textile Mills Private Limited (TGKTMPL).
Acuite has also assigned its long-term rating of ‘ACUITE C (read as ACUITE C) on the Rs. 30.00 Cr. bank facilities of Theni Guru Krishna Textile Mills Private Limited (TGKTMPL).

Rationale of Rating Downgrade
The downgrade is based on delays reported in servicing of debt obligation as reflected in the Credit bureau information report and written feedback received from the South Indian bank.

About the Company

Theni Guru Krishna Textile Mills Private Limited (TGKMPL) was established in 2005 by taking over the existing partnership firm, M/s. Theni Guru Krishna Mills & Theni Krishna Exports. It is promoted by ATK Group, which has been engaged in the textile business, since 1950. Based out of Theni (Tamil Nadu), TGKMPL is a vertically integrated textile player and sells cotton yarn, grey fabric as well as garments. TGKMPL majorly exports Made-ups to USA health care sector. It has installed capacity of 43,468 spindles for spinning division, 343 looms for weaving division, 495 machines for garmenting and 5.25 MW of installed windmill division and 7MW of solar power, which supplies over 40 per cent of the company's power requirement.

Unsupported Rating

Not Applicable

Analytical Approach

Acuité has considered the standalone business and financial risk profiles of the TGKMPL to arrive at this rating

Key Rating Drivers

Strengths

Established track record of operations and experienced management
TGKMPL is promoted by Mr. T. K Ramasamy, Mr. T. K. Srinivasan, Mr. T. K. Ponraj and Mr, S. Rajasekar. The rating draws comfort from the long-standing experience of over 7 decades of the promoters of TGKMPL (ATK group) in textile and allied sectors, having started with cotton ginning, trading and allied business activities in 1950. The management has built a healthy relationship with suppliers over the years for procurement of raw materials at a competitive cost and good credit terms. TGKMPL exports majority of its overall sales to the USA health care sector, with the majority of sales from madeups such as surgical towels, cellular blankets.

Weaknesses

Instances of delays in debt servicing
Instances of delays in debt-servicing have been reported in recent months in the Credit Bureau Information report of the company.

Rating Sensitivities

Timely servicing of debt obligations

Liquidity Position

Stretched

Liquidity position of the company is marked stretched due to instances of delays in servicing of debt obligation by the company in recent months.

Outlook: Not Applicable

Other Factors affecting Rating

None

Key Financials

Particulars	Unit	FY 24 (Actual)	FY 23 (Actual)
Operating Income	Rs. Cr.	534.82	547.71
PAT	Rs. Cr.	(9.23)	7.10
PAT Margin	(%)	(1.73)	1.30
Total Debt/Tangible Net Worth	Times	1.48	1.35
PBDIT/Interest	Times	1.59	2.53

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
• Rating Process and Timeline: https://www.acuite.in/view-rating-criteria-67.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
27 Oct 2023	Letter of Credit	Short Term	25.00	ACUITE A3+ (Reaffirmed)
	Term Loan	Long Term	45.94	ACUITE BBB \| Negative (Reaffirmed)
	Warehouse Receipt Financing	Long Term	20.00	ACUITE BBB \| Negative (Reaffirmed)
	Cash Credit	Long Term	32.00	ACUITE BBB \| Negative (Reaffirmed)
	Term Loan	Long Term	8.19	ACUITE BBB \| Negative (Reaffirmed)
	Cash Credit	Long Term	10.00	ACUITE BBB \| Negative (Reaffirmed)
	Term Loan	Long Term	3.08	ACUITE BBB \| Negative (Reaffirmed)
	Term Loan	Long Term	1.59	ACUITE BBB \| Negative (Reaffirmed)
	Term Loan	Long Term	16.31	ACUITE BBB \| Negative (Reaffirmed)
	Term Loan	Long Term	7.05	ACUITE BBB \| Negative (Reaffirmed)
	Term Loan	Long Term	5.19	ACUITE BBB \| Negative (Reaffirmed)
	Term Loan	Long Term	7.00	ACUITE BBB \| Negative (Assigned)
	Stand By Line of Credit	Long Term	10.00	ACUITE BBB \| Negative (Reaffirmed)
	Term Loan	Long Term	1.71	ACUITE BBB \| Negative (Reaffirmed)
	Term Loan	Long Term	2.77	ACUITE BBB \| Negative (Reaffirmed)
	Term Loan	Long Term	13.15	ACUITE BBB \| Negative (Reaffirmed)
	Proposed Long Term Bank Facility	Long Term	0.02	ACUITE BBB \| Negative (Reaffirmed)
	Term Loan	Long Term	25.00	ACUITE BBB \| Negative (Reaffirmed)
	Cash Credit	Long Term	53.00	ACUITE BBB \| Negative (Reaffirmed)
	Cash Credit	Long Term	17.00	ACUITE BBB \| Negative (Assigned)
20 Feb 2023	Letter of Credit	Short Term	25.00	ACUITE A3+ (Downgraded from ACUITE A2)
	Term Loan	Long Term	45.94	ACUITE BBB \| Stable (Downgraded from ACUITE BBB+ \| Stable)
	Warehouse Receipt Financing	Long Term	20.00	ACUITE BBB \| Stable (Downgraded from ACUITE BBB+ \| Stable)
	Term Loan	Long Term	1.71	ACUITE BBB \| Stable (Downgraded from ACUITE BBB+ \| Stable)
	Term Loan	Long Term	25.00	ACUITE BBB \| Stable (Assigned)
	Cash Credit	Long Term	22.00	ACUITE BBB \| Stable (Downgraded from ACUITE BBB+ \| Stable)
	Term Loan	Long Term	8.19	ACUITE BBB \| Stable (Downgraded from ACUITE BBB+ \| Stable)
	Cash Credit	Long Term	10.00	ACUITE BBB \| Stable (Downgraded from ACUITE BBB+ \| Stable)
	Term Loan	Long Term	3.08	ACUITE BBB \| Stable (Downgraded from ACUITE BBB+ \| Stable)
	Term Loan	Long Term	1.59	ACUITE BBB \| Stable (Downgraded from ACUITE BBB+ \| Stable)
	Term Loan	Long Term	16.31	ACUITE BBB \| Stable (Downgraded from ACUITE BBB+ \| Stable)
	Cash Credit	Long Term	63.00	ACUITE BBB \| Stable (Downgraded from ACUITE BBB+ \| Stable)
	Term Loan	Long Term	7.05	ACUITE BBB \| Stable (Downgraded from ACUITE BBB+ \| Stable)
	Term Loan	Long Term	5.19	ACUITE BBB \| Stable (Downgraded from ACUITE BBB+ \| Stable)
	Term Loan	Long Term	2.77	ACUITE BBB \| Stable (Downgraded from ACUITE BBB+ \| Stable)
	Term Loan	Long Term	13.15	ACUITE BBB \| Stable (Downgraded from ACUITE BBB+ \| Stable)
	Proposed Long Term Bank Facility	Long Term	10.02	ACUITE BBB \| Stable (Downgraded from ACUITE BBB+ \| Stable)

Annexure - Details of instruments rated

Lender’s Name	ISIN	Facilities	Date Of Issuance	Coupon Rate	Maturity Date	Quantum (Rs. Cr.)	Complexity Level	Rating
South Indian Bank	Not avl. / Not appl.	Cash Credit	30 Nov 2024	Not avl. / Not appl.	Not avl. / Not appl.	10.00	Simple	ACUITE C \| Downgraded ( from ACUITE BBB )
State Bank of India	Not avl. / Not appl.	Cash Credit	15 Apr 2024	Not avl. / Not appl.	Not avl. / Not appl.	53.00	Simple	ACUITE C \| Downgraded ( from ACUITE BBB )
IDBI Bank Ltd.	Not avl. / Not appl.	Cash Credit	14 Jan 2024	Not avl. / Not appl.	Not avl. / Not appl.	32.00	Simple	ACUITE C \| Downgraded ( from ACUITE BBB )
State Bank of India	Not avl. / Not appl.	Cash Credit	15 Apr 2024	Not avl. / Not appl.	Not avl. / Not appl.	16.00	Simple	ACUITE C \| Downgraded ( from ACUITE BBB )
State Bank of India	Not avl. / Not appl.	Cash Credit	15 Apr 2024	Not avl. / Not appl.	Not avl. / Not appl.	27.00	Simple	ACUITE C \| Assigned
State Bank of India	Not avl. / Not appl.	Letter of Credit	Not avl. / Not appl.	Not avl. / Not appl.	Not avl. / Not appl.	25.00	Simple	ACUITE A4 \| Downgraded ( from ACUITE A3+ )
Not Applicable	Not avl. / Not appl.	Proposed Long Term Bank Facility	Not avl. / Not appl.	Not avl. / Not appl.	Not avl. / Not appl.	24.75	Simple	ACUITE C \| Downgraded ( from ACUITE BBB )
Not Applicable	Not avl. / Not appl.	Proposed Warehouse Receipt Financing	Not avl. / Not appl.	Not avl. / Not appl.	Not avl. / Not appl.	8.25	Simple	ACUITE C \| Downgraded ( from ACUITE BBB )
Not Applicable	Not avl. / Not appl.	Proposed Warehouse Receipt Financing	Not avl. / Not appl.	Not avl. / Not appl.	Not avl. / Not appl.	1.75	Simple	ACUITE C \| Assigned
Axis Bank	Not avl. / Not appl.	Secured Overdraft	29 Nov 2024	Not avl. / Not appl.	Not avl. / Not appl.	1.25	Simple	ACUITE C \| Assigned
State Bank of India	Not avl. / Not appl.	Stand By Line of Credit	Not avl. / Not appl.	Not avl. / Not appl.	Not avl. / Not appl.	10.00	Simple	ACUITE C \| Downgraded ( from ACUITE BBB )
State Bank of India	Not avl. / Not appl.	Term Loan	Not avl. / Not appl.	Not avl. / Not appl.	Not avl. / Not appl.	1.71	Simple	ACUITE C \| Downgraded ( from ACUITE BBB )
Axis Bank	Not avl. / Not appl.	Term Loan	01 Dec 2024	Not avl. / Not appl.	01 Nov 2029	12.41	Simple	ACUITE C \| Downgraded ( from ACUITE BBB )
State Bank of India	Not avl. / Not appl.	Term Loan	15 Apr 2024	Not avl. / Not appl.	31 Mar 2035	14.00	Simple	ACUITE C \| Downgraded ( from ACUITE BBB )
State Bank of India	Not avl. / Not appl.	Term Loan	07 Jan 2021	Not avl. / Not appl.	07 Jan 2026	11.66	Simple	ACUITE C \| Downgraded ( from ACUITE BBB )
IDBI Bank Ltd.	Not avl. / Not appl.	Term Loan	05 Aug 2022	Not avl. / Not appl.	31 Jul 2027	3.47	Simple	ACUITE C \| Downgraded ( from ACUITE BBB )
State Bank of India	Not avl. / Not appl.	Term Loan	15 Sep 2023	Not avl. / Not appl.	15 Aug 2031	34.68	Simple	ACUITE C \| Downgraded ( from ACUITE BBB )
South Indian Bank	Not avl. / Not appl.	Term Loan	01 Apr 2021	Not avl. / Not appl.	30 Apr 2028	1.48	Simple	ACUITE D \| Downgraded ( from ACUITE BBB )
South Indian Bank	Not avl. / Not appl.	Term Loan	24 Dec 2018	Not avl. / Not appl.	30 Jun 2026	0.56	Simple	ACUITE D \| Downgraded ( from ACUITE BBB )
Karur Vysya Bank	Not avl. / Not appl.	Term Loan	25 Nov 2024	Not avl. / Not appl.	30 Jun 2032	11.37	Simple	ACUITE C \| Downgraded ( from ACUITE BBB )
Karur Vysya Bank	Not avl. / Not appl.	Term Loan	01 Jan 2024	Not avl. / Not appl.	31 Dec 2028	4.06	Simple	ACUITE C \| Downgraded ( from ACUITE BBB )
Tamil Nadu Mercantile Bank	Not avl. / Not appl.	Term Loan	Not avl. / Not appl.	Not avl. / Not appl.	26 Dec 2029	1.11	Simple	ACUITE C \| Downgraded ( from ACUITE BBB )
ICICI Bank Ltd	Not avl. / Not appl.	Term Loan	Not avl. / Not appl.	Not avl. / Not appl.	Not avl. / Not appl.	2.77	Simple	ACUITE C \| Downgraded ( from ACUITE BBB )
HDFC Bank Ltd	Not avl. / Not appl.	Term Loan	24 Jun 2021	Not avl. / Not appl.	07 Jul 2026	5.72	Simple	ACUITE C \| Downgraded ( from ACUITE BBB )
State Bank of India	Not avl. / Not appl.	Warehouse Receipt Financing	Not avl. / Not appl.	Not avl. / Not appl.	Not avl. / Not appl.	20.00	Simple	ACUITE C \| Downgraded ( from ACUITE BBB )

Contacts

Mohit Jain
Senior Vice President - Rating Operations

Kirti Berlia
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.