Sayaji Industries Limited, a leading player in India’s maize processing and starch manufacturing sector, has received a comprehensive credit rating downgrade from CARE Ratings Limited across all major financial instruments, as disclosed by the company to the Bombay Stock Exchange (BSE). The rating action, communicated through an official filing dated 26 November 2025, reflects the rating agency’s reassessment of the company’s operational and financial performance for the first half of FY26.

The company’s fixed deposit programme, long-term bank facilities and short-term borrowing programmes—all previously enjoying a more favourable credit position—have been marked down to lower investment grades. According to CARE’s letters dated 24 November 2025, the decision follows a structured review process and is based on developments observed in the recent financial period.

Downgrade Across All Categories of Borrowings

As per the company’s SEBI-compliant disclosure, CARE Ratings has adjusted its ratings as follows:

• Fixed Deposit Programme (₹40 crore):
  Downgraded from CARE BBB-; Negative to CARE BB+; Negative

• Long-Term Bank Facilities (₹58.80 crore):
  Revised from CARE BBB-; Negative to CARE BB+; Negative

• Long-Term / Short-Term Bank Facilities (₹135 crore):
  Downgraded from CARE BBB-; Negative / CARE A3 to CARE BB+; Negative / CARE A4

• Short-Term Bank Facilities (₹23.50 crore):
  Cut from CARE A3 to CARE A4+

The FD programme rating revision is especially notable, given that fixed deposits are typically subscribed by retail investors and therefore reflect broader market confidence in the company’s repayment capability. As per CARE's letter, of the ₹40 crore rated FD programme, ₹31.42 crore remained outstanding as of 30 September 2025.

Reasons Behind the Rating Change

The downgrade is explicitly linked to the company’s operational and financial metrics in H1 FY26, which CARE Ratings reviewed during its committee evaluation. Although detailed financial figures are not disclosed in the correspondence, such rating adjustments typically reflect:

• Margin pressures

• Slower revenue growth

• Increased working capital intensity

• Higher leverage

• Cash flow mismatches

• Industry-specific challenges

For a company engaged in maize-derived product manufacturing—where input price volatility, supply dependency and competitive pressures are inherent—any decline in operational performance can significantly impact credit quality.

The Negative outlook indicates that further deterioration remains possible if financial metrics do not stabilise or improve over the short to medium term.

CARE Ratings’ Instructions and Monitoring Requirements

CARE Ratings has issued multiple compliance instructions to Sayaji Industries as part of the revised ratings:

1. Revalidation Requirement:
   If the full FD amount is not placed within six months of the rating letter, Sayaji must seek revalidation.

2. Disclosure of Programme Documents:
   The company must provide all documentation associated with the FD programme.

3. Monitoring of Deposit Mobilisation:
   CARE must be informed once deposits reach the rated amount.

4. Continuing Information Flow:
   CARE reminded that non-submission of adequate information may lead to the label “ISSUER NOT COOPERATING” being appended to the rating.

5. Surveillance and Revisions:
   CARE reserves the right to revise, reaffirm, or withdraw ratings based on any new developments.

6. Press Release Announcement:
   The company acknowledges that CARE will issue a public press release summarising the rating action.

Such conditions are standard for debt instruments but assume greater importance during downgrade phases, as agencies intensify their monitoring.

Regulatory Disclosure Under SEBI LODR

Sayaji Industries has filed this information under Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements), Regulations, 2015, which mandates immediate disclosure of material events that may impact investor decision-making.

The company’s compliance officer, Vishnu H Thaker, confirmed the submission and attached the CARE Rating letters as annexures. The communication reiterates that the document is digitally signed and does not require a physical stamp.

Such filings are crucial for maintaining transparency, especially in circumstances where a downgrade could influence equity and debt market perceptions.

Understanding the Rating Impact

A downgrade from BBB- to BB+ shifts the entity from the lowest rung of investment grade to the highest rung of speculative grade according to CARE’s scale. The distinction is important:

• BBB-: Investment grade rating indicating moderate degree of safety regarding timely servicing of financial obligations but with moderate credit risk.

• BB+: Non-investment grade category indicating moderate risk of default, particularly under adverse economic conditions.

Similarly, a downgrade of the short-term rating from A3 to A4+ reflects:

• Lower certainty of timely payment

• Vulnerability to adverse market conditions

• Greater reliance on stable liquidity for servicing short-term obligations

These shifts can impact:

• Borrowing costs

• Ability to raise debt at competitive rates

• Counterparty confidence

• Supplier credit terms

• Investor perception

For companies with working-capital heavy operations such as food processing and agro-based manufacturing, short-term ratings are particularly critical.

Implications for Fixed Deposit Holders

The FD rating downgrade may concern retail investors who typically view corporate fixed deposits as a higher-yield yet moderate-risk instrument. A CARE BB+ rating implies higher risk than instruments in the A or BBB categories.

While the downgrade does not indicate imminent default, it signals that the company’s financial cushion has weakened compared to earlier assessments. CARE Ratings reiterates in its disclaimer that ratings should not be construed as guidance to buy, sell, or hold securities.

Investors will likely monitor:

• Company’s liquidity position

• Upcoming redemptions

• Cash flow adequacy

• Future rating actions

Companies often respond to such situations through operational adjustments, cost optimisation, or debt restructuring to restore confidence.

Background of Sayaji Industries Limited

Founded in 1941 and headquartered in Ahmedabad, Gujarat, Sayaji Industries is one of India’s established maize processing companies. Operating under the brand Maize Products, the company manufactures a wide range of starch derivatives and value-added maize products used across industries such as:

• Food and beverages

• Pharmaceuticals

• Textiles

• Paper manufacturing

• Confectionery

• Industrial chemicals

The company’s long history and manufacturing scale have positioned it as a well-recognised player in the agro-processing sector. However, industry cycles, raw material supply fluctuations, and demand-side volatility often influence financial performance.

CARE’s Standard Disclaimers and Clarifications

CARE Ratings included standard disclaimers in its letters, emphasizing:

• Ratings are opinions, not recommendations.

• Ratings may change without notice.

• Information is taken from reliable sources but not independently verified.

• The rating agency is not liable for decisions made based on the published ratings.

• Ratings do not consider foreign currency sovereign risk.

• No rating-trigger clauses are assumed unless disclosed.

These notes are consistent with regulatory norms and industry practice.

What the Downgrade Suggests for the Near Future

The Negative outlook indicates a possibility of further downgrades if:

• Earnings weaken

• Margins contract

• Working capital pressures intensify

• Debt levels increase

• Industry conditions turn unfavourable

Conversely, an outlook revision to Stable would require:

• Improvement in revenue trajectory

• Better operating margins

• Strengthened liquidity

• Reduction in leverage

• Demonstrated stability in operations

Given that the rating is based on unaudited H1FY26 performance, the next few quarters will be critical for Sayaji Industries as it attempts to stabilise its financial profile.

Investor and Market Reaction

While the immediate market reaction is not included in the document, such announcements typically lead to:

• Increased attention from institutional investors

• Possible fluctuations in share prices

• Re-evaluation of debt exposure by lenders

• Adjustments to credit limits or interest rates

• Greater scrutiny from analysts

Companies facing downgrades often communicate corrective strategies in subsequent investor presentations.

Conclusion

The rating downgrade issued by CARE Ratings marks a significant development for Sayaji Industries Limited, signalling heightened risk perception around the company’s credit profile. While the company has fulfilled its regulatory obligation by promptly informing the stock exchange, stakeholders will closely monitor its operational performance in the upcoming quarters.

For now, the revised ratings—CARE BB+; Negative for long-term and CARE A4+ for short-term facilities—reflect a cautious outlook, underscoring the need for stronger financial recovery to restore investor confidence.

The eventual impact on borrowing costs, market sentiment, lender engagement, and fixed-deposit mobilisation will depend on how effectively the company responds to the challenges highlighted through this rating action.

Join our Telegram Channel for Latest News and Regular Updates.

Start your Mutual Fund Journey  by Opening Free Account in Asset Plus.

Start your Stock Market Journey and Apply in IPO by Opening Free Demat Account in Choice Broking FinX.