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KG Mills Raised INR 57 Crore+ Working Capital Loan via Yubi Loans

The result
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    Yubi Loans


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    Textile Manufacturing


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Srihari Balakrishnan

CEO, Sri Kannapiran Mills

Yubi Loans platform helped match us with suitable top lenders and in no time, we received several expressions of interest, which was a problem in our geography. The credit evaluation tools of the platform fastracked the processes. The platform helped us get a loan of INR 57+ Cr Loan. 

About the Company

Sri Kannapiran Mills Limited

About the Company 

Part of the KG Group (valued at $250 million) established in 1932), Sri Kannapiran Mills Limited (SKML) is a trendsetting textile giant in South India. The group that started with cotton trading has now become an integrated textile conglomerate. SKML has expanded its manufacturing capabilities to 6 locations.

The group has been innovating its processes over the years towards more lean and clean operations. They have invested consciously in renewable power generation, and they possess the most water-efficient technology for denim dyeing in the industry. Despite investing in the technology, KG Mills also faced the burn from the fluctuating cost of raw materials, and the capped pricing of finished goods was beyond SKML’s control.

The Challenge

Below are some of the challenges faced by KG mills due to price fluctuations:

  1. Price Fluctuation-Susceptible Profits from Cotton and Yarn.
  2. Apart from the seasonal availability of cotton in India due to agro-climatic conditions, global trade & geo-political relations play a significant role in cotton and yarn prices.
  3. With low yields in FY21-22 across India, cotton/yarn prices almost doubled over the period, and textile  manufacturers had their working capital tied up or exhausted, leading to slumped growth.
  4. Intense competition compels manufacturers to cap the price of finished goods at a certain level - but restricts them from charging an increased price of raw materials from their customers.
  5. Limited Access to Investors.
  6. Based in Coimbatore, KG Mills had limited access to the lender community. Not only are the number of lenders limited in the geography, but there was also a limited range of debt products available
  7. Existing lenders were unwilling to lend in incremental limits and, therefore, were not contributing significantly to the business’ growth.

The Solution

The price fluctuation of raw-material and the capped pricing of finished goods were beyond SKML’s control. The only way SKML could keep operations running was by having access to capital at the time of need.

  1. Access to Capital When Required.
  2. SKML had anticipated the uptrend in the market and therefore had clarity on incremental working capital loan requirement to achieve the target top line.
  3. The foresight enabled them to have enough stocks to last 2 quarters and also helped the management facilitate product innovation (lesser cotton per gram of cloth) in the middle of a crisis.
  4. Within 2 months of onboarding on the Yubi Loans Platform, SKML received 12 expressions of interest from private, public, and foreign banks.
  5. They had the flexibility to choose from the most competitive offers.
  6. The first loan was disbursed within 2 months of onboarding on the Yubi Loans Platform.

The Results

With Yubi

  1. KG Mills Nearly Doubled Their Turnover .
  2. KG Mills turnover crossed INR 500 Cr in FY22 - which is nearly double of that in FY21 (INR 252 Cr).
  3. The growth was a result of their management pre-empting the requirement and getting access to low-cost and quick capital.


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