GRM Overseas Limited — Credit Ratings, 22-04-2025: Credit Rating

**GRM Overseas Limited - Credit Rating Update**

Acuité Ratings & Research Limited has reaffirmed GRM Overseas Limited's long-term rating at ‘Acuite A-’ and short-term rating at 'Acuite A2+'. The stable outlook reflects the company's healthy financial risk profile and strong liquidity position. Despite a revenue rebound in 9MFY2025 to ₹1,056 Cr., up from ₹906 Cr. in the same period last year, profitability margins have moderated. The operating profit margin is 6.31%, down from 7.35%, while the PAT margin decreased to 3.80% from 4.63%.

Challenges include the working capital-intensive nature of operations and exposure to agro-climatic risks, as well as vulnerability to foreign exchange fluctuations given its export markets. Inventory risks pose additional concerns due to the seasonal dependence on paddy production.

The group's net worth improved to ₹429.74 Cr., with a debt to equity ratio of 0.68, indicating a moderate leverage position. Liquidity remains strong with a current ratio of 2.42 and healthy cash accruals of ₹64.39 Cr., providing a buffer against minimal repayment obligations.

Investors should monitor the company's capacity to sustain revenue growth while enhancing profitability. The focus on expanding domestic sales, bolstered by the launch of the 10X Ventures platform targeting D2C brands, may provide future growth opportunities. Overall, a cautious 'hold' position is suggested as the company navigates operational challenges while leveraging its established market presence.