Press Release

Press Release

February 23, 2026

THENPANDIAN SPINNING MILLS INDIA PRIVATE LIMITED
Rating Assigned

Product	Quantum (Rs. Cr)	Long Term Rating	Short Term Rating
Bank Loan Ratings	102.35	ACUITE BBB- \| Stable \| Assigned	-
Bank Loan Ratings	1.65	-	ACUITE A3 \| Assigned
Total Outstanding	104.00	-	-
Total Withdrawn	0.00	-	-

Rating Rationale

Acuite has assigned its long term rating of ‘ACUITE BBB-' (read as ACUITE triple B minus) and short-term rating of 'ACUITE A3' (read as ACUITE A three) on Rs. 104.00 Cr. bank facilities of Thenpandian Spinning Mills India Private Limited (TSMIPL). The outlook is 'Stable'.

Rationale for rating:
The assigned rating considers the extensive industry experience of the promoters over three decades in spinning industry. The rating also factors in the stable scale of operations, moderate capital structure supported by moderate net worth base and comfortable debt protection metrics. The rating also factors in the ongoing capex towards expanding its spindle capacity. This expansion, is expected to enhance the company’s focus on higher-margin finer-count yarn, is likely to drive growth in both revenues and EBITDA in the near term while moderating the financial risk profile to an extent. However, the rating is constrained by working capital intensive nature of operations and susceptibility of profitability to volatility in raw material prices in an intensely competitive textile industry.

About the Company

The company was initially set up in 1993 as Tirupur Tirukkumaran Textiles Private Limited in January 1993 by Mr. A Palanisami to undertake manufacturing of combed yarn from raw cotton along with his wife Ms. P. Pankajam. In August 2013. the management of Thenpandian group comprising Mr. K Nallusamy, Mr. N. Raveendran and their family members took over the company. The Thenpandian group has diverse business interests including Tenpandian transport. Meena LPG industries and Thenpandian textiles Pvt. Ltd. TSMIPL is a textile manufacturer operating primarily in the spinning segment, with its core business centered on the production and sale of yarn, along with supplementary revenue from cotton/PSF/VSF fibre, waste, garments, fabric, and small service-based income streams. Yarn remains the company’s dominant contributor to revenue. The company has installed capacity of 59,520 spindles.

Unsupported Rating

Not applicable.

Analytical Approach

Acuité has considered the standalone financial and business risk profile of TSMIPL to arrive at the rating.

Key Rating Drivers

Strengths

Established track record of operations and experienced management

TSMIPL, incorporated in 1993 is a Tirupur–based company engaged in the manufacture of combed yarn from cotton and grey cloth (grey cloth manufacturing is outsourced). The promoters, Mr. Kaliappan Nallusmy and Mr. Nallusamy Raveendran have more than a decade of experience in the textile industry. The extensive industry experience of the promoters has enabled them to establish a healthy relationship with its various customers and suppliers. The company has a total of 59,520 spindles of capacity. Acuité believes that the company will stable growth in its existing business profile over the medium term on the back of an established track record of operations with experienced management.

Stable scale of operations

The company has recorded stable revenue growth, reporting Rs. 212.11 Cr. in FY2025 compared to Rs. 207.40 Cr. in FY2024 and Rs. 168.44 Cr. in FY2023. The improvement in sales volume supported the growth; however, the average selling price declined due to higher production of lower-count yarn (20–30s). The operating margins stood at 9.85 percent in FY2025 against 9.78 percent in FY2024, 5.43 percent in FY2023. In current fiscal, the company has achieved revenues worth Rs.148.42 Cr. till 9MFY2026. Operating income is expected to remain muted in FY2026 as the company shifts its production mix toward higher-count (60s) yarn, prioritizing margins over volume. The company’s ongoing capex in FY2026, which involved expanding spindle capacity, is expected to yield operational and financial benefits starting from FY2027. Acuité believes that the operational performance would improve in the medium term backed by expansion of spindle capacity.

Moderate financial risk profile
Company’s financial risk profile is moderate, marked by moderate net worth (Inclusive of quasi equity) along with moderate gearing and debt protection metrics. The net worth of the company stood at Rs.59.35 Cr. as on March 31, 2025, against Rs.54.87 Cr. as on March 31, 2024, and Rs. 31.61 Cr. as on March 31, 2023 respectively. The net worth includes quasi equity of Rs. 15.59 Cr. (USL has been considered as quasi equity). The gearing (debt to equity) of the company stood at 1.48 times as on March 31, 2025, as against 2.04 times as on March 31, 2024, and 3.45 times as on March 31, 2023. Total debt includes short term debt of Rs. 43.90 Cr, long term debt of Rs. 43.75 Cr. as on March 31, 2025. Company’s debt protection metrics is moderate marked by– Interest coverage ratio (ICR) and debt service coverage ratio (DSCR) stood at 2.86 times and 1.04 times as on March 31, 2025, respectively as against 2.43 times and 1.01 times as on March 31, 2024, and 1.43 times and 1.42 times as on March 31, 2023. TOL/TNW stood at 1.68 times as on March 31, 2025, against 2.24 times as on March 31, 2024 and 3.82 times as on March 31, 2023, respectively. The debt to EBITDA of the company stood at 3.88 times in March 2025 as 5.19 times in FY2024 and 11.54 times in FY2023. The company is undertaking a capital expenditure of Rs.43.34 crore toward expanding its spindle capacity, which is expected to be capitalised by Q4 FY2026. Despite the capex being largely debt-funded, the company’s leverage indicators are expected to remain stable, supported by its healthy accruals . Acuité believes that the financial risk profile will remain moderate over the medium term.

Weaknesses

Moderately intensive working capital operations

TSMIPL's working capital operations are moderately intensive in nature as reflected through the gross current days (GCA) days of 124 days in FY2025 against 154 days in FY2024 and 131 days in FY2023. The GCA days majorly driven by inventory days of 59 days in FY2025 compared to 96 days in FY2024 and 69 days in FY2023. FY2025, the inventory holding period improved to 59 days from 96 days in FY2024. This is due to timely procurement aligned with production schedules and lower buffer stock requirements. The company allows 35-50 days credit period for its customers resulting in debtors of 50 days in FY2025 against 39 days in FY2024 and 33 days in FY2023. Acuite believes, the working capital operations are expected to remain moderately intensive given the nature of business.

Susceptibility of profitability to the fluctuations in the raw material prices in an intensely competitive textile industry
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: Adequate

Company’s liquidity is adequate with net cash accruals (NCA)s of Rs.10.71 Cr. during FY2025, while its maturing debt obligations are Rs. 10.06 Cr. during the same period. Going forward, the company is expected to continue generating net cash accruals of Rs.15.92 Cr. against its repayment obligations of Rs. 10.50 Cr. The company has maintained unencumbered cash and bank balances Rs.0.26 Cr. and the current ratio stood at 1.16 times as on March 31, 2025. However, the reliance on working capital limits stood moderate marked by average 86.44 percent utilization of the fund-based limits used over the past 12 months ending in December 2025. Acuité expects that the liquidity of the company is likely to be adequate over the medium term on account of adequate cash accruals.

Outlook: Stable

Other Factors affecting Rating

None.

Key Financials

Particulars	Unit	FY 25 (Actual)	FY 24 (Actual)
Operating Income	Rs. Cr.	212.11	207.40
PAT	Rs. Cr.	4.64	7.32
PAT Margin	(%)	2.19	3.53
Total Debt/Tangible Net Worth	Times	1.48	2.04
PBDIT/Interest	Times	2.86	2.43

Status of non-cooperation with previous CRA (if applicable)

None.

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 :

Not applicable.

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	Not avl. / Not appl.	Not avl. / Not appl.	Not avl. / Not appl.	36.00	Simple	ACUITE BBB- \| Stable \| Assigned
State Bank of India	Not avl. / Not appl.	Letter of Credit	Not avl. / Not appl.	Not avl. / Not appl.	Not avl. / Not appl.	1.65	Simple	ACUITE A3 \| Assigned
Not Applicable	Not avl. / Not appl.	Proposed Long Term Bank Facility	Not avl. / Not appl.	Not avl. / Not appl.	Not avl. / Not appl.	1.38	Simple	ACUITE BBB- \| Stable \| Assigned
State Bank of India	Not avl. / Not appl.	Term Loan	01 Apr 2022	Not avl. / Not appl.	28 Feb 2030	5.97	Simple	ACUITE BBB- \| Stable \| Assigned
State Bank of India	Not avl. / Not appl.	Term Loan	21 Mar 2022	Not avl. / Not appl.	30 Nov 2029	20.76	Simple	ACUITE BBB- \| Stable \| Assigned
State Bank of India	Not avl. / Not appl.	Term Loan	31 Dec 2019	Not avl. / Not appl.	31 Mar 2031	2.04	Simple	ACUITE BBB- \| Stable \| Assigned
State Bank of India	Not avl. / Not appl.	Term Loan	31 Mar 2022	Not avl. / Not appl.	05 Apr 2027	0.61	Simple	ACUITE BBB- \| Stable \| Assigned
State Bank of India	Not avl. / Not appl.	Term Loan	06 Mar 2024	Not avl. / Not appl.	10 Apr 2031	2.10	Simple	ACUITE BBB- \| Stable \| Assigned
State Bank of India	Not avl. / Not appl.	Term Loan	17 Nov 2025	Not avl. / Not appl.	31 Oct 2033	32.35	Simple	ACUITE BBB- \| Stable \| Assigned
Indian Bank	Not avl. / Not appl.	Term Loan	28 Nov 2022	Not avl. / Not appl.	15 Nov 2029	0.54	Simple	ACUITE BBB- \| Stable \| Assigned
Indian Bank	Not avl. / Not appl.	Term Loan	09 May 2023	Not avl. / Not appl.	15 Feb 2029	0.60	Simple	ACUITE BBB- \| Stable \| Assigned

Contacts

Mohit Jain
Chief Analytical Officer - Rating Operations

Moparthi Anuradha Devi
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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