Go Fashion (India) said that ICRA had upgraded the long term and the short term ratings on the credit facitilies of the company.
The credit rating agency has upgraded Go Fashion's long-term rating to '[ICRA] A' from '[ICRA] A-'. It has also upgraded the company's short-term rating to '[ICRA] A1' from '[ICRA] A2+'.
ICRA said that the ratings upgrade reflects the expected steady improvement in the performance of Go Fashion India (GFIL) over the medium term, backed by its strong market position in the domestic women's bottom wear segment.
Besides, GFIL has a healthy financial profile, characterized by strong capitalization levels and liquidity position, further strengthened by the equity infusion of Rs 125 crore made through the initial public offering (IPO) in November 2021.
Post the pandemic-induced business disruptions in FY2021, GFIL's business performance improved in the current fiscal, driven by its established brand and better demand conditions (registering around 77% YoY revenue growth in 9M FY2022).
ICRA expects GFIL's revenue to witness a 10% CAGR over the medium term, driven by steady demand and continued diversification measures with around 120 exclusive brand outlets (EBOs) proposed to be added every year in the coming fiscals.
Further, backed by its store operating efficiency, better economies of scale, and improving revenue contribution from the higher-margin EBO channel, the operating margins have recovered to approximately 30% in FY 2022 and are likely to remain at similar strong levels in the coming fiscals.
The 'stable' outlook reflects ICRA's opinion that GFIL's performance in the coming quarters will continue to benefit from its established market position with a healthy operating efficiency, proposed diversification initiatives, and strong capitalization levels.
Go Fashion (India) is involved in the retailing of women's bottom wear products under its brand, Go Colors. The products are sold in the domestic market through its extensive pan India retail channel comprising 476 EBOs and around 1,330 large format stores.
The company's consolidated net profit rose 33.4% to Rs 23.69 crore on 46.6% rise in net sales to Rs 142 crore in Q3 FY22 over Q3 FY21.
The scrip shed 0.14% to end at Rs 996.00 on the BSE on Friday.
Powered by Capital Market - Live News
(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)
Dear Reader,
Business Standard has always strived hard to provide up-to-date information and commentary on developments that are of interest to you and have wider political and economic implications for the country and the world. Your encouragement and constant feedback on how to improve our offering have only made our resolve and commitment to these ideals stronger. Even during these difficult times arising out of Covid-19, we continue to remain committed to keeping you informed and updated with credible news, authoritative views and incisive commentary on topical issues of relevance.
We, however, have a request.
As we battle the economic impact of the pandemic, we need your support even more, so that we can continue to offer you more quality content. Our subscription model has seen an encouraging response from many of you, who have subscribed to our online content. More subscription to our online content can only help us achieve the goals of offering you even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practise the journalism to which we are committed.
Support quality journalism and subscribe to Business Standard.
Digital Editor
RECOMMENDED FOR YOU