| Dewan and Sons | ||||
| Rating reaffirmed at 'Crisil BBB+/Stable' | ||||
| Rating Action | ||||
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| Note: None of the Directors on Crisil Ratings Limited’s Board are members of rating committee and thus do not participate in discussion or assignment of any ratings. The Board of Directors also does not discuss any ratings at its meetings. | ||||
| 1 crore = 10 million | ||||
| Refer to Annexure for Details of Instruments & Bank Facilities |
Detailed Rationale Crisil Ratings has reaffirmed its ‘Crisil BBB+/Stable’ rating on the long-term bank facilities of Dewan and Sons (DS; part of Dewan and Sons Group).
On August 27, 2025, the US issued additional 25% tariff on Indian imports over and above the existing 25%, raising uncertainties on the exporters. Dewan and Sons Group (group) has an overall exposure of 80-85% to the US, including reputable global retailers in North America like Walmart, The Home Depot, Bed Bath & Beyond etc.
Crisil Ratings has taken note of these developments and their likely impact on the business and financial flexibility of the group. The group’s focus on geographical diversification in the near to medium term is expected to support the business risk profile, as their share of revenue from US is expected to decline to 70-75%, reducing the burden of tariffs; and the financial risk profile continues to remain healthy.
Dewan group’s ratings are driven largely by healthy business and financial risk profiles. Crisil Ratings, factors in the group’s established market position and healthy financial risk profile of the group in the industry. While the performance till July 2025 was not significantly impacted by the tariffs, as reflected by the revenue of Rs 215 crore, with about Rs 40-44 crore of profit before tax (PBT). Its likely impact on revenue growth and profitability in the coming quarters will remain monitorable. The group’s improving orderbook from other countries like UK, Australia etc., is expected to moderate the impact. Moreover, the group has financial flexibility to absorb such impacts over the near term, backed by healthy networth, low leverage levels and moderate liquidity with over Rs 24 crore of liquid assets as on March 31, 2025. The group has no long-term debt, and hence, the absence of repayment obligations further supports liquidity profile.
However, Crisil Ratings believes any adverse actions by the US government or any fallout from these developments restricting group’s access to international markets may exacerbate the situation. Therefore, these events, along with diversification to other geographies and sustenance of healthy financial and operating performance of the group, shall remain a key monitorable.
The rating continues to reflect the established presence of the group in the handicrafts industry and its healthy financial risk profile. These strengths are partially offset by the moderate scale of operations, and lower size of net cash accruals due to sizeable capital withdrawal by the partners. |
Analytical Approach Crisil Ratings has combined the business and financial risk profiles of DS, Dewan India, and Dewan and Sons Exports Pvt Ltd (DEPL). This is because all these entities, together referred to as the Dewan and Sons group, are in the same business and have common partners and management team.
The unsecured loans of Rs 50 crore (as on March 31, 2025) from the promoters have been treated as neither debt nor equity as these are likely to remain in the business over the medium term. The remaining unsecured loans of Rs 50 crore have been treated as debt.
Please refer Annexure - List of Entities Consolidated, which captures the list of entities considered and their analytical treatment of consolidation. |
Key Rating Drivers & Detailed Description Strengths:
Weaknesses:
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Liquidity: Adequate The bank limit utilisation was about 82% on average over the 12 months through June 2025. Cash accrual is expected to be over Rs 47-50 crore against nil term debt obligation over the medium term and will hence, cushion liquidity. The current ratio was healthy at 2.47 times as on March 31, 2024. The promoters are likely to extend equity and unsecured loans to meet working capital requirement and debt obligation. Moderate cash and bank balance, fixed deposits and liquid investments of around Rs 24 crore as on March 31, 2025, also support the liquidity. |
Outlook: Stable Crisil Ratings believes the Dewan and Sons group will continue to benefit from its above-average financial risk profile and strong clientele. |
Rating sensitivity factors Upward factors:
Downward factors:
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About the Group DS was set up in 1967, as a proprietary concern of Mr. Somnath Gandhi and reconstituted as a partnership after Mr. Gandhi's sons, Mr. Surender Gandhi and Mr. Joginder Gandhi, joined the business in 2002. The firm manufactures and exports steel, brass, and wrought iron casting products such as fire-pits. Its manufacturing facility is at Moradabad in Uttar Pradesh.
Dewan India, which was set up in 2011, manufactures glassware at its facility in the Moradabad special economic zone.
Dewan and Sons Export Private Limited, an entity incorporated in April 2022, would take over the business operations of Dewan and Sons, along with manufacturing cookware and injection molding articles. |
Key Financial Indicators Consolidated
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Any other information: Not Applicable |
Note on complexity levels of the rated instrument: |
Annexure - Details of Instrument(s)
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Annexure – List of entities consolidated
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| Annexure - Rating History for last 3 Years | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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| All amounts are in Rs.Cr. | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Annexure - Details of Bank Lenders & Facilities | ||||||||||||||||||||
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Criteria Details
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