Credo Brands Marketing said that the credit rating agency CARE Ratings has reaffirmed the company's long-term rating at 'CARE A+; Stable'.
The agency has also reaffirmed the companys short term rating at CARE A1+.
CARE Ratings said that the reaffirmation of the ratings assigned to bank facilities of Credo Brands Marketing (CBML) continues to derive strength from the vast experience of the promoter in retail lifestyle industry, presence of well-established brand name Mufti coupled with having widespread distribution network with focus on asset light business model, the companys arrangement with suppliers, comfortable financial risk profile and strong liquidity profile.
The ratings also factor in the improvement in the scale of operations and operating profit margins in FY23 (refers to April 01 to March 31) and in 9MFY24.
The ratings, however, continue to be tempered by the relatively moderate scale of operations, dependence on the single brand, elongated operating cycle and inherent risks associated with the lifestyle retailing industry in the backdrop of changing consumer preferences and prevailing intense competition in the apparel segment.
Credo Brands Marketing is engaged in the marketing of men's fashion garments in the lifestyle category under the brand name of "MUFTI. The company has outsourced the garment manufacturing activities and manages only designing/branding/marketing through various stores across India. The company carries out sales through store formats such as exclusive brand outlets (EBOs), multi brand outlets (MBOs) and large format stores (LFS).
The company's consolidated net profit had declined 19.51% to Rs 15.59 crore despite a 15.05% rise in sales to Rs 150.14 crore in Q3 FY24 over Q3 FY23.
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