| Sky Industries Limited | ||||||
| Ratings reaffirmed at 'Crisil BBB- / Stable / Crisil A3 ' | ||||||
| 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 ratings on the bank loan facilities of Sky Industries Ltd (SIL) at ‘Crisil BBB-/Stable/Crisil A3’.
The ratings continue to reflect the company’s established market position marked by large customer base, and healthy financial risk profile. These strengths are partially offset by the company’s modest scale of operations in a highly fragmented industry and fluctuating profitability. |
Analytical Approach For arriving at its ratings, Crisil Ratings has consolidated the business and financial risk profiles of SIL with its subsidiary Skytech Textiles Pvt Lt; together these are referred to as Sky Group.
Please refer Annexure - List of Entities Consolidated, which captures the list of entities considered and their analytical treatment of consolidation. |
Key Rating Drivers - Strengths Established market position in hook and loop industry: SIL’s market position is backed by a strong track record of more than 25 years and more than 800 active customers and direct sales to 90% of the clients. The top 10 customers contributed to 35% revenues in fiscal 2025. Key customers have been associated with the company for 10-15 years, ensuring stable orders. As SIL supplies to a wide range of industries, including footwear, automotive and aviation, dependence on a single sector is low. The company sells its products under various brands, prominent among them being Sky-Magic, Sky-Walker, Sky-Magna and Sky-Wonder. The promoters' experience of around three decades, understanding of local market dynamics and established relationships with suppliers and customers should continue to support the business risk profile. Revenues has increased from Rs. 74 Crores in fiscal 2023 to Rs. 84 crores in fiscal 2025.
Healthy financial profile: SIL’s capital structure is comfortable because of low reliance on external funds yielding gearing of 0.26 time and low total outside liabilities to adjusted networth (TOLANW) ratio of 0.44 time as on March 31, 2025. The debt protection metrics have been healthy because of low leverage and healthy profitability, as reflected in interest coverage and net cash accrual to total debt (NCATD) ratios of 9.58 times and 0.59 time, respectively, for fiscal 2025. The financial profile is expected to be comfortable over the medium term despite a expected debt-funded capex. |
Key Rating Drivers - Weaknesses Modest scale of operations: During the five fiscals through March 31, 2025, although the revenue have increased to Rs 84 crore, it remains modest. Scale up in operations is constrained by intense competition from a large unorganized sector, leading to smaller market size for manufacturers of premium, high-quality fasteners and moderate export revenue. The overall scale of operations is expected to remain moderate given the industry dynamics.
Low and fluctuating profitability: Operating profitability fluctuated between 7% to 12% over the three fiscals through 2025, primarily on account of fluctuations in raw material prices. While SIL has moderate ability to pass on these input price hikes to clients, operating margin is expected to remain susceptible to any large and sudden movements in input prices. |
Liquidity Adequate Bank limit utilisation is low at around 39% for the past twelve months ended August 2025. Cash accrual are expected to be over Rs 6 to 8 crore which is sufficient against term debt obligation of around Rs 2.50 crore over the medium term.
Current ratios are healthy at 2.23 times on March 31, 2025. Unencumbered cash and bank balance of around Rs 0.48 crore as on March 31, 2025. Low gearing and moderate net worth support its financial flexibility and provides the financial cushion available in case of any adverse conditions or downturn in the business. |
Outlook Stable Crisil Ratings believes SIL's business risk profile will continue to benefit from the extensive experience of its promoters and established relationships with customers |
Rating sensitivity factors Upward factors
Downward factors
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About the Group Incorporated in 1989, SIL promoted by Shah family and manufactures hook and loop tape fasteners and other value-added products, including velvet tape and webbings. It also deals in fibre glass insect screens and other products. The manufacturing facilities are in Navi Mumbai and Bhiwandi, Maharashtra. The company is listed on the Bombay Stock Exchange (BSE) and is managed by professional team.
Skytech Textiles Private Limited: It is a subsidiary that was incorporated on June 12,2023 and is engaged in the business of technical Textile and allied products namely Neoprene. It has recently commenced its operations. |
Key Financial Indicators
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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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