Sanathan Textiles Ltd

The agency has affirmed the company's long-term and short-term rating at '[ICRA] A' and '[ICRA] A2+', respectively. ICRA stated that the 'positive' outlook on the rating reflects ICRA's expectations that the revenues and profit margins of the Sanathan Group are likely to improve, going forward, led by the commercialisation of a new plant by the end of Q1 FY2026. Post the completion of the ongoing expansion project in SPPL, the group's capacity will double by the end of Q1 FY2026 and will help the company to further strengthen its operating profile on the back of better product mix and proximity to both raw material sources and consumption centres. The management also expects the new plant to report better operating profit margins given the savings in freight (due to proximity to customers) and fuel costs (due to usage of rice husk). SPPL's ability to effectively and profitably ramp up the capacity would be a key rating monitorable. ICRA, however, notes STL's established relationships with customers and suppliers, which will help the company in receiving regular and repeat orders and, in turn, sweat its assets at optimal capacity utilisation rates. The rating continues to factor in the group's position as one of the leading players in polyester yarn manufacturing in India and the extensive experience of its promoters in the industry. The ratings also derive strength from its diversified product portfolio, established distribution networkand location specific advantages owing to its proximity to raw material sources. The rating alsoremains constrained by the susceptibility of the company's profit margins to the cyclicality inherent in the textile sector and the volatility in crude oil linked raw material prices and realisations. The rating is also constrained by the intense competition and the fragmented nature of the yarn industry, which exertspricing pressure. The company furtherremains exposed to forex risks as about 40% of the total debt contracted for the ongoing capex is denominated in foreign currency, which in addition to its raw material imports would keep the company a net forex buyer in the near-to-medium term. Sanathan Textiles is mainly engaged in the manufacturing and exports of polyester yarn, cotton yarn and yarn for technical textile. The total installed capacity stood at 2,00,750 metric tonnes per annum (MTPA) for polyester yarn, 14,000 MTPA for cotton yarn and 9,000 MTPA for industrial drawn yarn as on 31 December 2024. Powered by Capital Market - Live

Sanathan Textiles has received credit ratings from ICRA reaffirming the rating while the outlook has been revised to positive. Long term - Fund based - Term Loans (Rs. 35 crore) - [ICRA]A (Positive); reaffirmed. Outlook revised to Positive from Stable Long term - Fund based Limits (Rs. 160 crore) - [ICRA]A (Positive); reaffirmed. Outlook revised to Positive from Stable Short term -Non-fund based Limits (Rs. 715 crore) - [ICRA]A2+; reaffirmed Total - Rs. 910 crorePowered by Capital Market - Live

Net profit of Sanathan Textiles declined 0.23% to Rs 34.17 crore in the quarter ended December 2024 as against Rs 34.25 crore during the previous quarter ended December 2023. Sales declined 4.78% to Rs 743.13 crore in the quarter ended December 2024 as against Rs 780.41 crore during the previous quarter ended December 2023. ParticularsQuarter EndedDec. 2024Dec. 2023% Var. Sales743.13780.41 -5 OPM %7.877.75 - PBDT58.6955.89 5 PBT47.0044.69 5 NP34.1734.25 0 Powered by Capital Market - Live

Sanathan Textiles will hold a meeting of the Board of Directors of the Company on 10 February 2025.Powered by Capital Market - Live

Sanathan Textiles will hold a meeting of the Board of Directors of the Company on 17 January 2025.Powered by Capital Market - Live

The scrip was listed at Rs 419.10, exhibiting a premium of 30.56% to the issue price. So far, the stock has hit a high of 422.65 and a low of 382.85. On the BSE, over 9.95 lakh shares of the company were traded in the counter so far. The initial public offer (IPO) of Sanathan Textiles was subscribed 35.12 times. The issue opened for bidding on 19 December 2024 and it closed on 23 December 2024. The price band of the IPO was fixed between Rs 305 and 321 per share. The IPO consisted of a fresh issue of Rs 400 crore and an offer for sale of Rs 150 crore by promoter and promoter group. Out of the proceeds from the fresh issue, Rs 160 crore will be used for repayment or prepayment of certain borrowings, Rs 140 crore towards investment in subsidiary Sanathan Polycot Private Limited for repayment or prepayment of certain borrowings and the balance towards general corporate purposes. Ahead of the IPO, Sanathan Textiles on Wednesday, 18 December 2024, raised Rs 164.99 crore from anchor investors. The board allotted 51.40 lakh shares at Rs 321 each to 20 anchor investors. Sanathan Textiles is engaged in manufacturer of polyester yarn and cotton yarn. The company's business is divided into three separate yarn business verticals, consisting of: polyester yarn products; cotton yarn products; and yarns for technical textiles and industrial uses. These technical textiles are used in various sectors such as automotive, healthcare, construction, sports and outdoor activities, and protective clothing. As on September 30, 2024, STL had more than 3,200 active varieties of yarn products and more than 45,000 stock keeping units (SKUs), and capability to manufacture a diversified product portfolio of more than 14,000 varieties of yarn products and more than 190,000 SKUs that are used in various forms and for varied end uses. On a consolidated basis, the firm registered consolidated net profit of Rs 50.07 crore and income from operations of Rs 781.13 crore for the three months ended on 30 June 2024. Powered by Capital Market - Live