Details:
Superhouse Limited, a Government of India-recognized export trading house based in Kanpur, has received a credit rating reaffirmation from Acuité Ratings & Research. The rating agency reaffirmed the long-term rating of ‘ACUITE A-’ and short-term rating of ‘ACUITE A2+’ on the company’s Rs.219 crore bank facilities. However, the outlook has been revised from Stable to Negative, indicating caution about the company’s near-term financial prospects.
The downgrade in outlook was primarily due to a decline in revenue and profitability. Superhouse reported a revenue of ₹665.85 crore in FY24 compared to ₹768.13 crore in FY23, mainly due to weaker export demand in key global markets such as the US, UK, and Europe. Additionally, the EBITDA margin dropped to 5.67% in FY24 from 7.68% in FY23, while PAT margin fell to 1.76% from 3.64%.
The group’s financial risk profile remains strong, with a healthy net worth of ₹461.45 crore, gearing below unity (0.44x), and adequate liquidity. Interest coverage ratio (ICR) stands at 3.16x. The company’s operations are, however, marked by intensive working capital usage and are vulnerable to foreign exchange fluctuations.
Despite challenges, Superhouse benefits from a diversified product portfolio, experienced promoters with 40+ years in the leather industry, and a global presence through subsidiaries in the UK, USA, and Middle East.
🔹 Key Points:
🔸 Credit Rating:
▪️ ACUITE A- (Long Term)
▪️ ACUITE A2+ (Short Term)
▪️ Outlook: Changed from Stable ➡️ Negative
🔸 Revenue & Profitability:
▪️ FY24 Revenue: ₹665.85 Cr ↓ from ₹768.13 Cr (FY23)
▪️ PAT Margin FY24: 1.76% ↓ from 3.64% (FY23)
▪️ EBITDA Margin FY24: 5.67% ↓ from 7.68%
🔸 Financial Strength:
▪️ Net Worth: ₹461.45 Cr
▪️ Gearing: 0.44x
▪️ Interest Coverage Ratio: 3.16x
▪️ Liquidity: Adequate
🔸 Challenges Faced:
▪️ Export Slowdown in US, UK, EU
▪️ High Working Capital Days: 256 (FY24)
▪️ Competitive Industry Pressure
▪️ Currency Fluctuation Risk
🔸 Strengths:
▪️ 40+ Years of Industry Experience
▪️ Global Subsidiaries (UK, USA, Middle East)
▪️ Approved by Walmart, GAP, DKNY
▪️ Diversified Product Range: Footwear, Leather, Garments
📈 Impact on Share Market
The change in outlook to Negative may trigger short-term bearish sentiment on Superhouse’s stock. While the reaffirmed rating assures stability, the deteriorating margins and reduced export demand may worry institutional and retail investors. Investors might expect stock price volatility in the near term unless revenue growth stabilizes.
🏢 Company Snapshot: Superhouse Limited
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Industry: Leather, Footwear, Garments
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CIN: L24231UP1980PLC004910 44m
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Established: 1980
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Location: Kanpur, Uttar Pradesh
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Website: superhouse.in
📊 Key Market Data (as per last rating)
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Net Worth: ₹461.45 Cr
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Total Debt: ₹203.65 Cr
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Revenue (FY24): ₹665.85 Cr
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PAT (FY24): ₹11.73 Cr
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Current Ratio: 1.47
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EBITDA Margin (FY24): 5.67%
👤 How This Helps Retail Traders
✔️ Helps gauge creditworthiness of the company before investing.
✔️ Outlook change acts as a signal to reassess risk in the short term.
✔️ Useful for understanding the financial health and market sentiment.
✔️ Traders can track this to align with entry/exit strategies.
📊 Quick Chat Summary for Investors
| Parameter | FY24 | FY23 |
|---|---|---|
| Revenue | ₹665.85 Cr | ₹768.13 Cr |
| PAT Margin | 1.76% | 3.64% |
| EBITDA Margin | 5.67% | 7.68% |
| Net Worth | ₹461.45 Cr | ₹445.28 Cr |
| ICR | 3.16x | 4.74x |
| Gearing | 0.44x | 0.43x |
| Working Capital Days | 256 | 232 |
💬 Phrase:
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📉 Stock Market Disclaimer
Disclaimer: This post is for informational and educational purposes only and does not constitute financial advice or a recommendation to buy/sell any stock or share. Investing in the stock market involves risk. Past performance is not indicative of future results. Always conduct your own research or consult a licensed financial advisor before making investment decisions.
