Note:- For activities or ratings of instruments falling under the purview of Financial Sector Regulators other than SEBI, the grievance / dispute redressal mechanisms and investor protection mechanisms provided by SEBI shall not be available.
Rating Rationale
Acuité has reaffirmed the long term rating of ‘ACUITE BBB+’ (read as ACUITE triple B plus) and short term rating of ‘ACUITE A2’ (read as ACUITE A two) on the Rs. 65.00 crore bank facilities of Bharat Rail Automations Private Limited (BRAPL). The outlook is revised from "Negative" to "Stable".
Rationale for reaffirmation and outlook revision
The rating reaffirmation and outlook revision considers significant improvement in the operating revenue in FY2026 post stagnant topline over the last few years. The rating also factors the moderate financial risk profile and moderate orderbook position of the company. Further, the rating draws comfort from the reputed counter party and the long track record of operations of BRAPL. However, the rating continues to remain constrained on account of the intensive working capital operations and tender based nature of operations coupled with intense competition in the industry.
About the Company
Mumbai based Bharat Rail Automations Private Limited (BRAPL) was established as a partnership firm in the year 1986 and was converted to a private limited entity in 2004. The company undertakes infrastructure projects of railways which includes installations of railway safety and signalling systems i.e., installation of SSI, panel interlocking and route relay interlocking, automatic signalling etc. Mr. Bhupesh Dhabalia, Mr. Alpa Bhuptany and Mr. Sagar Dhabalia are the present directors of the company.
Unsupported Rating
Not Applicable
Analytical Approach
Acuité has considered the standalone business and financial risk profiles of BRAPL for arriving at the rating.
Key Rating Drivers
Strengths
Established track record of operations and experienced management
BRAPL has an operational track record of nearly four decades. The company is promoted by Mr. Bhupesh Dhabalia and Mr. Bharat Dhabalia who have experience of more than four decades in the industry. The company is a Class-I signalling contractor and has ISO 9001:2008 certification for design of signalling equipment system and installation, testing & commissioning of signalling projects. The extensive experience of the management has helped BRAPL in maintaining a stable order flow from IRCON International, Rail Vikas Nigam, Mumbai Rail Vikas Corporation among others. Acuité believes that BRAPL will continue to benefit from its experienced management and established track record of operations.
Improvement in scale of operations While the topline of BRAPL remained stagnant over the last few years, it improved significantly and stood at Rs. 228 Cr. in FY2026 (Est.) from Rs. 113.54 Cr. in FY2025 on account of timely order execution. As on March 31, 2026, BRAPL's unexecuted order book position stood at Rs. ~536 Cr. (~2 times of FY2026 revenue), which provides a sound revenue visibility over the medium term. Additionally, the operating margins have remained rangebound within 6 - 8 percent and are expected to remain in a similar range going forward. The PAT margin stood marginally declined at 4.64 percent in FY2025 as against 4.98 percent in FY2024 due to increased finance costs. Going forward, continued inflow of fresh work orders and timely execution for the same will be a key monitorable.
Moderate financial risk profile
The financial risk profile of BRAPL is marked by low gearing, moderate networth and adequate debt protection metrics. The tangible networth of the company stood at Rs. 66.34 Cr. on March 31, 2025 from Rs. 61.07 Cr. on March 31, 2024 post profit accretion. The gearing continues to remain below unity at 0.47 times in FY2025 (0.26 times in PY). Further, the absence of external long term debt provides additional comfort. The TOL/TNW levels also remain below unity at 0.92 times in FY2025 (0.75 times in PY). However, the Debt-EBITDA levels increased to 2.95 times in FY2025 from 1.56 times in FY2024 due to increased utilization of working capital limits. The coverage indicators stood adequate with interest coverage ratio (ICR) at 3.17 times and debt service coverage ratio (DSCR) at 2.62 times in FY2025.
The financial risk profile is expected to remain moderate in the absence of any debt funded capex plans of the company.
Weaknesses
Intensive working capital operations
The intensive operations of BRAPL are marked by high gross current assets (GCA) of 309 days in FY2025. These are driven by high inventory and receivable period which stood at 135 days and 166 days respectively in FY2025. The high receivable days also appear to be elongated due to higher year end sales and the inclusion of retention money. On the other hand, creditor days stood at 136 in FY2025. The GCA are also driven by other current assets, majorly consisting of balance with government departments. The average bank limit utilization stood at ~54 percent for the last five months ended February 2026.
Tender based nature of operations and high competition The infrastructure industry is fragmented, with presence of large players pan India where subcontracting & project specific partnerships for technical/financial reasons are common. The company faces stiff competition with its competitors in procuring orders through bidding. Immense competition for procuring tenders leads to very competitive pricing which in turn lead to stress on the margins. Moreover, susceptibility of raw material pricing again keeps profit margins vulnerable and is a key sensitivity factor.
Rating Sensitivities
Potential triggers (individual or collective) for an upward rating action:
Significant improvement in operating performance supported by order book growth leading to operating revenues higher than Rs. 450 - 500 Cr
Improvement in working capital cycle
Potential triggers (individual or collective) for a downward rating action:
Increase in debt levels, thereby leading to deterioration in the financial risk profile
Decline in operating margins below 6 percent
Liquidity Position
Adequate
The adequate liquidity of BRAPL is marked by its net cash accruals (NCAs) of Rs. 5.39 Cr. against nil repayment obligations in FY2025. The NCAs are expected to remain in the range of 10 – 12 Cr. for FY2026 and FY2027 against no term liabilities. The current ratio stood healthy at 1.96 times on March 31, 2025. The average bank limit utilization stood at ~54 percent for the last five months ended February 2026. The company also had an unencumbered cash and bank balance of 0.06 Cr. on March 31, 2025.
Outlook: Stable
Other Factors affecting Rating
None
Particulars
Unit
FY 25 (Actual)
FY 24 (Actual)
Operating Income
Rs. Cr.
113.54
122.89
PAT
Rs. Cr.
5.27
6.12
PAT Margin
(%)
4.64
4.98
Total Debt/Tangible Net Worth
Times
0.47
0.26
PBDIT/Interest
Times
3.17
5.37
Status of non-cooperation with previous CRA (if applicable)
ACUITE BBB+ | Stable | Reaffirmed | Negative to Stable
Note:- For activities or ratings of instruments falling under the purview of Financial Sector Regulators other than SEBI, the grievance / dispute redressal mechanisms and investor protection mechanisms provided by SEBI shall not be available.
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List of instruments and names of regulators of the instruments
