| Established track record and extensive experience of promoters
Established in 2007, SCC has a established track record of operations with proprietor of the firm Mr. R Sakthivel having an experience of more than 15 years in the civil construction business. The firm has built a longstanding relationship with reputed clientele namely Biocon Biologics Limited, Axxalant Pharma Science, Hindustan Coca-cola, United Breweries, etc. Acuite believes that the firm will continue to benefit from the extensive experience of the promoters in the medium to long term.
Stable scale of operations and moderate order book
SCC reported a stable operating scale with operating income of Rs.104.78 Cr. in FY25 as against Rs.101.43 Cr. in FY24. The revenue in FY25 was impacted by the deferment of a major ~Rs.60 Cr. project by 4–6 months due to approval delays from authorities. The order book position remains moderate, at Rs.209 Cr. as on 31 January 2026, of which Rs.52 Cr. worth of orders have been completed and Rs.157 Cr. remains executable as of December 2026. Further, the profitability moderated in FY25 with EBITDA margin declined to 6.81 percent from 9.04 percent in FY24 due to timing differences in project execution. PAT margin declined to 3.19 per cent in FY25 as against 7.78 per cent in FY24. Till 9MFY26 the firm reported sales of Rs.51.79 Cr. with PBITDA margin at 13.73 percent and PAT margin at 7.76 percent, indicating improved cost efficiency and favourable project mix during the period. Acuite believes that sustaining revenue growth and profitability amid the current order-book execution will remain a key rating sensitivity.
Moderate working capital cycle
Working capital management continues to remain moderate with gross current assets (GCA) improving to ~60–62 days over FY24–FY25, The debtor days stood at 38 days in FY25 as compared to 42 days in FY24. Creditor days remained at around 61 days in FY25 compared to 63 days in FY24. Further, the inventory days stood at 14 days in FY25 as against 12 days in FY24. The average bank limit utilisation remained moderate at about 65 percent for the six months ended January 2026, providing adequate liquidity buffer.
Acuite believes that the firm’s ability to maintain an efficiently managed working capital cycle while supporting its scale of operations will remain a key rating sensitivity.
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| Average financial risk profile
The financial risk profile remains average, supported by an average net worth base and low gearing. The tangible net worth of the firm declined to Rs. 11.61 Cr. as on March 31, 2025 from Rs. 12.69 Cr. as on March 31, 2024 on the back of capital withdrawal. The total debt of the firm stood at Rs. 6.26 Cr.as on March 31, 2025 as against Rs. 6.15 Cr. as on March 31, 2024. The debt profile of the firm comprises of Rs. 0.69 Cr. of unsecured loans, and Rs. 0.09 Cr. of long-term loans, CPLTD of Rs. 0.03 Cr. and the Rs.5.45 Cr. short term borrowings as on March 31, 2025. Leverage remains controlled with debt to equity at 0.54 times in FY25 and 0.48 times in FY24. Coverage indicators remain healthy, with interest coverage ratio (ICR) of 8.14 times in FY25 and 12.85 times in FY24. Debt service coverage ratio (DSCR) remained adequate at 5.50 times in FY25 as compared to 11.71 times in FY24. Acuite believes that maintaining a stable capital structure while improving net worth base, leverage and coverage metrics will remain a key rating monitorable.
Susceptibility of profitability to volatility in input prices and stiff competition
The construction industry is fragmented industry with a presence of few large pan India players. The entity undertakes the projects for the private players and focuses more on the food and the pharma industry. Some of the reputed clients of Sribal Construction Company include – Coca Cola, Cipla, United Breweries etc. that helps the company to maintain healthy profitability margins. Further, the industry is having stiff competition with many players which is likely to put pressure on the profitability along with price fluctuation risk of input prices such as cement, bitumen, steel, etc
Capital withdrawal risk associated with proprietorship firm
Being a proprietorship firm, SCC is exposed to the capital withdrawal risk. Any significant withdrawal from the capital will have a negative bearing on the financial risk profile of the firm.
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