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| Product | Quantum (Rs. Cr) | Long Term Rating | Short Term Rating |
| Bank Loan Ratings | 18.50 | ACUITE B+ | Downgraded | Issuer not co-operating* | - |
| Total Outstanding | 18.50 | - | - |
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Rating Rationale |
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Acuité has downgraded the long-term rating to ‘ACUITE B+’ (read as ACUITE B plus) from ‘ACUITE BB-’ (read as ACUITE double B minus) on the Rs. 18.50 crore bank facilities of Varsha Fashion LLP (VF) on account of information risk. The rating continues to be flagged as “Issuer Not-Cooperating” and is based on the best available information. |
| About the Company |
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Varsha Fashion LLP was incorporated in 1995 as a private limited company by the name ‘Varsha Fashion Private Limited’ having Mr. Navinchandra Kapadia, Mr. Direndra Kumar Kapadia and Mr. Jigneshkumar Kapadia as promoters of the company. Later, the constitution was changed to Limited Liability Partnership in 2013. The firm is engaged in the manufacturing of designer sarees, dress materials and lehengas. The day-to-day operations are led by Mr. Navinchandra Kapadia, Mr. Dhirendra Kumar Kapadia, Mr. Jigneshkumar Kapadia and Mr. Parshawa Kapadia. The manufacturing unit is located at Ahmedabad. |
| Unsupported Rating |
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Not Applicable |
| Non-cooperation by the issuer/borrower: |
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Acuité has been requesting for data, information and undertakings from the rated entity for conducting surveillance & review of the rating. However, the issuer/borrower failed to submit such information before the due date. |
| Limitation regarding information availability: |
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The rating is based on information available from sources other than the issuer/borrower (in the absence of information provided by the issuer/borrower). Acuité endeavored to gather information about the entity/industry from the public domain. Therefore, Acuité cautions lenders and investors regarding the use of such information, on which the indicative credit ratingis based. |
| Rating Sensitivity |
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"No information provided by the issuer / available for Acuite to comment upon." |
| Liquidity Position |
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"No information provided by the issuer / available for Acuite to comment upon." |
| Outlook |
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Not Applicable |
| Other Factors affecting Rating |
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None |
| Particulars | Unit | FY 21 (Actual) | FY 20 (Actual) |
| Operating Income | Rs. Cr. | 41.40 | 75.43 |
| PAT | Rs. Cr. | 7.78 | 11.27 |
| PAT Margin | (%) | 18.78 | 14.94 |
| Total Debt/Tangible Net Worth | Times | 0.04 | 0.02 |
| PBDIT/Interest | Times | 99.81 | 61.00 |
| Status of non-cooperation with previous CRA |
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Not Applicable |
| Any other information |
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None |
| Applicable Criteria |
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• Manufacturing Entities: https://www.acuite.in/view-rating-criteria-59.htm • Default Recognition: https://www.acuite.in/view-rating-criteria-52.htm • Application Of Financial Ratios And Adjustments: https://www.acuite.in/view-rating-criteria-53.htm |
| Note on Complexity Levels of the Rated Instrument |
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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. |
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