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
Acuite has reaffirmed the long-term rating of “ACUITE BB+” (read as ACUITE Double B plus) on the Rs.15 crore bank facility and short-term rating of “ACUITE A4+” (read as ACUITE A Four plus) on the Rs.35 crore bank facility of Krans Projects Private Limited (KPPL). The Outlook is “Stable”.
Acuite has assigned the long-term rating of “ACUITE BB+”(read as ACUITE Double B plus) on the Rs.5 crore bank facility and short-term rating of “ACUITE A4+” (read as ACUITE A Four plus) on the Rs.20 crore bank facility of Krans Projects Private Limited (KPPL). The Outlook is “Stable”.
Rationale for Rating:
The rating reflects KPPL’s largely stable operating performance. There was a marginal decline in revenue in FY26 (Estd), primarily due to funding delays from government departments and delays in site clearances that affected execution momentum. Despite this moderation in revenues, profitability improved during FY26 (Estd) compared to FY25, mainly driven by lower subcontractor expenses. As on March 2026, the company had an outstanding order book of Rs.646.62 crore, with an OB/OI ratio of 4.22x, providing strong revenue visibility over the medium term. KPPL’s financial risk profile remains comfortable, marked by moderate net worth, low gearing and healthy debt protection metrics. The working capital position remained moderate. Liquidity stood adequate although Bank limit utilization stood high during the six months ended March 2026. Acuité believes that operational performance is likely to improve, supported by the unexecuted order book; however, the rating continues to be constrained by high customer concentration, thin profitability margins and risk associated with timely execution of projects.
About the Company
KRANS Projects Private Limited (KPPL) was established by K. Ranga Rao who earlier used to carry out works in his individual name since 1980 and then established the company in the year 2008.KPPL is Telangana based Company. KPPL is engaged in construction of Railway infrastructure, pathways, Earthwork Embankment, Bridges, Buildings.
Unsupported Rating
Not Applicable.
Analytical Approach
Acuité has considered the standalone business and financial risk profile of KPPL to arrive at the rating.
Key Rating Drivers
Strengths
EstablishedMarketpresence:
KPPL was established by Mr. K. Ranga Rao earlier used to carry out work in his individual name since 1980 and then established the company in the year 2008. With a vintage of operations of over 45 years, KPPL has managed to maintain a long-standing relationship with govt. clients like South Central Railways, RVNL, Rites Ltd etc. Acuite expects KPPL will benefit from its experienced management and established relationship with its client base over the medium term.
Comfortablefinancialriskprofile
The company’s financial risk profile is marked by moderate net worth, comfortable gearing and stable debt protection metrics. The tangible net worth of the company slightly increased to Rs. 40.08 crores Iin FY 26 (Estd) from Rs.37.64 crore in FY2025 due to accretion to reserves. Gearing of the company stood below unity at 0.31 times in FY2026 (Estd) as against 0.15 times in FY2025. The Total Outside Liabilities/Tangible Net Worth (TOL/TNW) stood at 0.71 times in FY 26 (Estd) as against 0.84 times in FY2025. Debt protection matrix remains healthy in FY 2026 (estd) with ICR and DSCR stood at 4.35 times and 2.78 times as compared to 3.37 times and 2.78 times in FY 2025. Debt/EBITDA stood at 3.15 times in FY 2026 (Estd). Going forward, KPPL plans to avail bank guarantees of Rs.20 crore, fund-based limits of Rs. 5 crore and incur capex of around Rs.5 crore through equipment financing. Acuité believes that while the proposed borrowings may marginally moderate the financial risk profile, it is expected to remain moderately stable in the medium term.
ModerateWorkingCapitalManagement:
KPPL’s working capital position remained moderate in FY2026 (ESTD), with the Gross Current Assets (GCA) increasing to 120 days from 91 days in FY2025, primarily due to elongation in debtor days. Debtor days increased sharply to 59 days in FY2026 (ESTD) from 14 days in FY2025, mainly on account of year-end billings; the same was subsequently realised in the first week of April. Inventory days declined to 28 days in FY2026 (ESTD) from 56 days in FY2025, driven by lower build-up of work-in-progress (WIP). Further, in FY2026, the commencement of own execution led to the build-up of sundry creditors amounting to Rs. 1.45 crore. Other current assets increased to Rs. 13.88 crore in FY2026 (ESTD) from Rs. 9.69 crore in FY2025, mainly due to an increase in retention money, which typically constitutes around 5% of the contract value. Acuité expects KPPL’s working capital cycle to remain in the range of 100–120 days over the medium term, supported by timely receivable realization and controlled inventory levels.
Weaknesses
Scaleofoperationwith thin profitability:
KPPL reported marginal decline in revenue in FY 26 (Estd) of Rs. 153.22 crore from Rs.168.88 crore in FY 25 on account of funding delays from departments and delays in site clearances, which impacted execution momentum.However, Despite the decline in topline, EBITDA margin increased to 2.53% in FY 26(Estd) from 1.51% in FY 2025 mainly on account of reduced subcontracting expenses. PAT margin also increased to 1.59% in FY 26 (estd) as compared to 0.60% in FY 25. As of March 2026, KPPL has a outstanding order book of Rs.646.62 crore, which gives good visibility for future revenue. Also, the company participated in tender worth Rs. 957.85 crore and expecting to win around 20 to 30% of the same. Management expects its own execution capabilities to improve over the medium term, which is likely to drive an increase in operating profitability in the near to medium term. Acuite believes that while KPPL’s operating performance will remain supported by its unexecuted order book, improvement in profitability and timely execution will remain key monitorable going forward.
PresenceinaCompetitiveandfragmentedindustrywithHighCustomerconcentration:
KPPL operates as a civil contractor in a highly competitive and fragmented industry, dominated by mid-to-large players where tender-based contract awards exert significant pricing pressure and restrict margin flexibility. Consequently, the company’s revenues and profitability remain exposed to risks inherent in competitive bidding, including aggressive pricing strategies and execution-related challenges. These risks are partially mitigated by the extensive industry experience of the promoter, Mr. K. Ranga Rao, who brings over four decades of sectoral expertise, enabling prudent bid selection and efficient project execution. KPPL’s association with reputed clients such as South Central and Southwestern Railways, coupled with efficient billing and payment cycles—typically within a week of bill submission—supports operational stability despite the competitive environment. However, with Southwestern Railway contributing over 95% of the company’s total revenue, customer concentration remains significantly high and will continue to be a key monitorable going forward.
Rating Sensitivities
Potential triggers (individual or collective) for an upward rating action:
Improvement in scale of operation and EBITDA margin increasing to 4.5% or above
Improvement in net worth
Potential triggers (individual or collective) for a downward rating action:
Scale of operation declining below Rs.90 crores or any further decline in profitability
Any deteriorating in financial risk profile and elongation in working capital management
Liquidity Position
Adequate
KPPL’s liquidity position remains Adequate as reflected by net cash accruals of Rs.2.77 crore in FY 2026 (ESTD) against a debt repayment obligation of Rs.0.42 crore. However, the utilisation levels of working capital facilities remained high, with fund-based limits utilised at around 95% for the six months ended March 2026. Average utilisation of non-fund-based limits also remained high at nearly 90–95%. Further, the proposed enhancement of fund-based limits by Rs. 5 crore is expected to support day-to-day operational requirements. Cash and bank balances stood low at Rs.0.07 crore in FY 2026 (Estd), while the current ratio increased to 1.80 times as on March 31, 2026 (Estd), from 1.40 times in FY 2025. However Company is planning to take an equipment loans in FY 27 of Rs. 4 to 5 crores. Acuité believes that liquidity is expected to be adequate with small but steady cash accruals against long term debt repayment, modest debt funded capex plans albeit high reliance on bank borrowing to fund working capital cycle.
Outlook: Stable
Other Factors affecting Rating
None
Particulars
Unit
FY 25 (Actual)
FY 24 (Actual)
Operating Income
Rs. Cr.
168.88
101.07
PAT
Rs. Cr.
1.01
0.63
PAT Margin
(%)
0.60
0.63
Total Debt/Tangible Net Worth
Times
0.15
0.11
PBDIT/Interest
Times
3.37
3.81
Status of non-cooperation with previous CRA (if applicable)
ACUITE A4+
(Reaffirmed & Issuer not co-operating*)
Proposed Short Term Bank Facility
Short Term
13.50
ACUITE A4+
(Reaffirmed & Issuer not co-operating*)
Cash Credit
Long Term
6.50
ACUITE BB+
(Reaffirmed & Issuer not co-operating*)
Lender’s Name
ISIN
Facilities
Listing Status
Regulated By
Date Of Issuance
Coupon Rate
Maturity Date
Quantum (Rs. Cr.)
Complexity Level
Rating
State Bank of India
Not avl. / Not appl.
Bank Guarantee (BLR)
Unlisted
RBI
Not avl. / Not appl.
Not avl. / Not appl.
Not avl. / Not appl.
17.00
Simple
ACUITE A4+ | Reaffirmed
YES BANK LIMITED
Not avl. / Not appl.
Bank Guarantee (BLR)
Unlisted
RBI
Not avl. / Not appl.
Not avl. / Not appl.
Not avl. / Not appl.
15.00
Simple
ACUITE A4+ | Reaffirmed
YES BANK LIMITED
Not avl. / Not appl.
Cash Credit
Unlisted
RBI
Not avl. / Not appl.
Not avl. / Not appl.
Not avl. / Not appl.
10.00
Simple
ACUITE BB+ | Stable | Reaffirmed
State Bank of India
Not avl. / Not appl.
Cash Credit
Unlisted
RBI
Not avl. / Not appl.
Not avl. / Not appl.
Not avl. / Not appl.
5.00
Simple
ACUITE BB+ | Stable | Reaffirmed
Not Applicable
Not avl. / Not appl.
Proposed Long Term Bank Facility
Unlisted
RBI
Not avl. / Not appl.
Not avl. / Not appl.
Not avl. / Not appl.
5.00
Simple
ACUITE BB+ | Stable | Assigned
Not Applicable
Not avl. / Not appl.
Proposed Short Term Bank Facility
Unlisted
RBI
Not avl. / Not appl.
Not avl. / Not appl.
Not avl. / Not appl.
3.00
Simple
ACUITE A4+ | Reaffirmed
Not Applicable
Not avl. / Not appl.
Proposed Short Term Bank Facility
Unlisted
RBI
Not avl. / Not appl.
Not avl. / Not appl.
Not avl. / Not appl.
20.00
Simple
ACUITE A4+ | Assigned
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.
Contacts
List of instruments and names of regulators of the instruments
