1. finance

Rating Rationale
Brickwork Ratings revises the ratings to ‘BWR A-’ & ‘BWR A2+’ of Go Go
International Private Limited’s Bank Loan Facilities enhanced from ₹ 112.47 Cr to ₹
130.24 Cr
Brickwork Ratings has revised the Ratings1 of Go Go International Private Limited’s (“GGIPL”
or “the Company”) Bank Loan Facilities enhanced from ₹ 112.47 Cr to ₹ 130.24 Cr as:
Facility
Previous
Limits
(₹ Cr)
Present
Limits
(₹ Cr)
Term Loans
17.87
25.24
Fund Based Working
Capital (FBWC)
89.60
100.00
Non Fund Based
Working Capital
5.00
5.00
(LC/BG as a sublimit
of FBWC)
(7.00)
(10.00)
Total Rated Limits
112.47
130.24
Tenure
Previous Rating
Present Rating
Long Term
BWR BBB+
(Pronounced BWR
Triple B Plus)
(Outlook:Stable)
BWR A(Pronounced BWR A
Minus)
(Outlook:Stable)
Short Term
BWR A3+
(Pronounced BWR A
Three Plus)
BWR A2+
(Pronounced BWR A
Two Plus)
INR One Hundred Thirty Crores and Twenty Four Lakhs Only
Note: Details of the Bank-wise facilities are as per the Annexure- I
BWR has principally relied upon the audited financial results of FY12, FY13, FY14 and projected
financials of FY15 & FY16 of Go Go International Private Limited, publicly available information
and information/clarification provided by the Company management.
The rating factors, inter alia, the promoter’s strength, professional and experienced key
management personnel, diversified and reputed customer base and product mix consistent and
better capacity utilization, geographical spread, efficient value chain, promoter's experience in
same line of business, and continuous focus on process improvement. However, the rating is
constrained by exposure to currency and country risks, demand seasonality in textile industry,
ability to continue the conservative volume growth in the changing economic conditions and
maintain increasing profitability margins.
Background
Go Go International Private Limited (GGIPL) was promoted in 1983 by Mr. Shyamsunder
Goenka for yarn and fabric exports. Since then it has evolved into manufacturing and export of
both knitted and woven garments for men, women and children. The Registered Office of GGIPL
is in Mumbai and Corporate Office is in Bangalore. It has fully integrated manufacturing
facilities with the necessary support departments at Bangalore and Hassan (Karnataka). The
Company employs around 5500 employee across all its factories and offices. GGIPL has received
various “Export Performance Awards” in the last 7 years, recognized by government and nongovernment organizations.
1
Please refer to www.brickworkratings.com for definition of the Ratings
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1
4 Nov 2014
Management Profile
Go Go International Private Limited is owned and controlled by the members of “Goenka”
family. Mr Shyamsunder Goenka has been leading the Company since 1983. His two sons - Mr
Rajeev S Goenka and Mr Achal S Goenka, subsequently joined the management team. Mr.
Jitendra Dugar, Executive Director and CEO, a Chartered Accountant by qualification and with
a vast industry experience, is a professional director presently handling business strategy,
finance and operational efficiency roles in the Company. Different family members support the
Company functioning by handling different roles like procurement, pricing and marketing.
Name
Designation
Qualification
Experience
Functional Responsibility
Mr. Shyamsunder G
Goenka
Executive
Director
cum
Promoter
MA
51 years
Business Strategies, Growth &
Expansion Plans and Finance
Mr. Rajeev S
Goenka
Executive
Director
cum
Promoter
BE
26 years
Marketing, Production and
Administration
Mr. Achal S Goenka
Executive
Director
cum
Promoter
MBBS,MD
25 years
Marketing/ Process House/
Procurement
Mrs. Nirmala R
Goenka
Executive
Director
cum
Promoter
B.COM
16 years
Procurement (Accessories and
Allied) & General
Administration
Mrs. Lalita A
Goenka
Executive
Director
cum
Promoter
MA
17 years
Printing & Designing
Mr. Jitendra Dugar
Executive
Director
B.Com, FCA
25 years
Business Strategy, Business
Growth, Finance & Banking,
Customs, Taxation, HR,
Audits, RoC & Secretarial, Cost
reduction & Operational
Efficiency
Mr. Suresh Jain
Executive
Director
B.Com, FCA
26 years
Process House, Procurement
(Capex and Fabrics) and
Costing
Mr. Kailash Jatwala
Executive
B.Com, FCS
28 years
Investments
Director
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4 Nov 2014
Financial Performance
GGIPL reported net sales of ₹ 232.76 Cr in FY14 in comparison to ₹214.90 Cr in FY13. The
Operating Profit margins has improved to 10.99% in FY14 in comparison to 8.48% in FY13. The
Net Profit margin has improved to 2.89% in FY14 in comparison to 2.79% in FY13. The
promoters funding in the form of unsecured loans to be retained during the entire tenor of loans
stands at ₹15.70 Cr in FY14, thereby Net worth of the Company has increased to ₹ 93.42 Cr in
FY14 from ₹ 85.02 Cr in FY13 and with further infusion by promoters during FY15 and FY16, is
estimated to cross ₹100 Cr. Company's debt-equity ratio stands at 1.10x in FY14 in comparison
to 1.02x in FY13 due to the increasing working capital facilities as a requisite for expanding
operations. With the increasing business and expansion, the Company’s fixed assets turnover
ratio also has improved from 2.82x in FY13 to 3.22x in FY14
Rating Outlook:
The outlook is expected to be stable over the year. The professionally qualified Board, following
of best practices for Corporate Governance and timeliness of its profile are the key factors for the
rating upgrade. The ability to continue the same and create its own brand awareness, apart from
the above shall remain the key rating sensitivities. Going forward, the Company's ability to
continue to manage currency and country risks, consistently grow in scale of operations while
maintaining the increasing streak of profit margins, thereby supported with promoters funding
would be the other key rating sensitivities.
Analyst Contact
Relationship Contact
[email protected]
[email protected]
Phone
Media Contact
1-860-425-2742
[email protected]
Disclaimer: Brickwork Ratings (BWR) has assigned the rating based on the information obtained from the issuer and other reliable sources,
which are deemed to be accurate. BWR has taken considerable steps to avoid any data distortion; however, it does not examine the precision or
completeness of the information obtained. And hence, the information in this report is presented “as is” without any express or implied warranty
of any kind. BWR does not make any representation in respect to the truth or accuracy of any such information. The rating assigned by BWR
should be treated as an opinion rather than a recommendation to buy, sell or hold the rated instrument and BWR shall not be liable for any losses
incurred by users from any use of this report or its contents. BWR has the right to change, suspend or withdraw the ratings at any time for any
reasons.
www.brickworkratings.com
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4 Nov 2014
Go Go International Private Limited –BLR-₹130.24Cr
Annexure-I
BAN
K
SCB
Kotak
SBM
VIJA
YA
HSB
C
UBI
IDBI
INDUS
IND
EXIM
–1
(Amount ₹ Cr.)
EXIM
AXIS
TOTAL
–2
SANCTION LIMITS – FUND & NON FUND BASED – WORKING CAPITAL (WC)
PC/P
CFC/
BD
35.0
0
BD
OD/C
C(subli
mit)
10.00
15.0
0
10.0
0
10.0
0
13.00
2.00
0.00
0.00
0.00
4.00
[2]
WCD
L
[5]
4.00
[10]
[10]
1.00
0.00
0.00
0.00
0.00
0.00
[5]
LC exclu
sive
0.00
LC (subli
mit)
[5]
BG
(subli
mit)
Work
ing
capita
l
95.00
1.00
[5]
0.00
0.00
5.00
0.00
0.00
0.00
0.00
0.00
5.00
[10]
0.00
-
[2]
0.00
0.00
0.00
0.00
0.00
[10]
0.00
[1]
0.00
-
0.00
0.00
0.00
0.00
0.00
0.00
[1]
35.0
0
14.00
15.0
0
10.0
0
16.00
13.00
2.00
0.00
0.00
0.00
105.00
TERM LOANS (TL)
Sanct
ioned
-
-
-
-
-
-
-
11.78
4.15
10.00
0.11
26.04
Outst
andin
g
0
0
0
0
0
0
0
11.64
3.51
-
0.09
15.24
Undr
awn
0
0
0
0
0
0
0
0
0
10.00
0
10.00
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4
4 Nov 2014
Term
Loan
s
0
0
0
0
0
0
0
11.64
3.51
10.00
0.09
25.24
Total
Limit
s
35.0
0
14.00
15.0
0
10.0
0
16.00
13.00
2.00
11.64
3.51
10.00
0.09
130.24
Aforesaid term loan outstanding and undrawn as on Aug 2014
Banks: SCB: Standard Chartered Bank; KOTAK: Kotak Bank Ltd; SBM: State Bank of Mysore; VIJAYA: Vijaya Bank;
HSBC: Hongkong & Shanghai Banking Corporation Bank Ltd; UBI: Union Bank of India; IDBI: Industrial Development
Bank of India; EXIM: Export Import Bank of India; AXIS: Axis Bank; INDUSIND: IndusInd Bank Ltd
Facilities: PC: Packing Credit/PCFC; Packing Credit in Foreign Currency; WCDL: Working Capital Demand Loan; LC:
Letter of Credit; BG: Bank Guarantee
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5
4 Nov 2014