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India Ratings has affirmed SRF Ltd’s national long-term rating at ‘IND AA’. The outlook is stable.
SRF is a diversified manufacturing company with presence in technical textiles, chemicals and packaging films. The affirmation reflects SRF’s continued strong position in the technical textiles and chemicals businesses. The ratings are also backed by the company’s sound credit metrics and strong liquidity position guided by its short cash conversion cycle.
The company clocked a 17 per cent year-on-year jump in revenues in FY12, with a significant growth contribution coming from certified emission reduction (CER) sales. The total revenue growth (excluding CERs) in FY12 was around 6.7 per cent year-on-year.
The technical textile business continued to contribute the maximum (53 per cent in FY12 and FY11) to overall revenues with this segment growing by around 15 per cent in FY12 despite the slowdown in the end-user industry in H212.
The chemicals business (excluding CERs) grew by around 13.6 per cent, while packaging films witnessed a decline of 24 per cent.
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