Bombay Dyeing and Manufacturing Company (BDAMCL) said that CRISIL Ratings has revised its outlook on the long-term bank facilities and fixed deposits of the company to 'positive' from 'stable'.
The agency has reaffirmed the companys long-term rating at 'CRISIL BBB+ and the short-term rating at 'CRISIL A2+.
CRISIL Ratings stated that the outlook revision factors in CRISILs expectation of improvement in business profile driven by steady growth in revenue and improvement in operating margin in the polyester stable fiber (PSF) business.
The expected improvement in operating margins is driven by cost efficiency measures being undertaken to save power costs and improve realizations through value addition, reasonable investments in capex in the cost efficiency projects through fiscal 2025 and fiscal 2026 is expected.
Further, the company is expected to launch fresh real estate project in H1 FY 2026 and customer bookings and response and hence cash flows from it will also be monitored.
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The companys financial profile and liquidity continues to be strong with no debt and surplus cash and cash equivalents including liquid investments of about Rs 1,300 crore as on 30 September 2024, with significant cash remaining on the books even with the launch of the real estate projects in FY 2026.
The ratings reflect diversified revenue profile and experience management, strong market position in the polyester staple (PSF) segment, healthy track record of executing real estate projects, and strong financial risk profile.
These strengths are partially offset by it low operating margins in PSF segment, susceptibility to volatility in raw material prices and forex fluctuations, and exposure to cyclicality inherent in the Indian real estate industry.
Bombay Dyeing and Manufacturing Company is a flagship company of Wadia Group. The company is is engaged in three business divisions, i.e., manufacturing polyester staple fiber (PSF), real estate and textile retail business.
The scrip shed 0.28% to currently trade at Rs 195.35 on the BSE.
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