Sutlej Textiles & Industries rose 2.15% to Rs 73.55 after the company said that India Ratings and Research has assigned a long-term issuer rating of 'IND A+' on the debt instruments of the company.
The outlook on the same is 'Stable', the ratings agency said.
India Ratings said that the ratings reflect Sutlej's established position in India's value-added spun-dyed yarn industry and strong clientele.
The ratings are further supported by an improvement in profitability on account of an improvement in the gross margin, supported by an increase in realisations as well as structural changes in costs by way of rationalising the manpower and energy costs, and reduced dependency on outside suppliers for its polyester staple fibre (PSF) requirement.
The ratings are also supported by the company' adequate liquidity position and an improvement in the credit metrics in H1 FY22.
However, the ratings are constrained by the company's loss-making Home Textile division, exposure to volatility in raw material prices and inherent textile industry risks.
Sutlej manufactures synthetic, natural, and blended yarns and home furnishing textiles such as curtains and made ups. It possesses one of the largest product portfolios of spun dyed yarn and cotton blended dyed and mange yarns.
The company's consolidated net profit surged to Rs 36.52 crore in the quarter ended December 2021 as against Rs 11.52 crore during the previous quarter ended December 2020. Sales rose 48.01% YoY to Rs 813.21 crore in Q3 FY22.
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