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 its long-term rating of 'ACUITE BBB' (read as ACUITE Triple B) and short-term rating of 'ACUITE A3+' (read as ACUITE A three plus) on the Rs.118.00 Cr. bank facilities of Bharat Electrical Contractors and Manufacturers Private Limited (BECMPL). The outlook is 'Stable'.
Further, Acuite has assigned its short-term rating of 'ACUITE A3+' (read as ACUITE A three plus) on the Rs.25.00 Cr. bank facilities of Bharat Electrical Contractors and Manufacturers Private Limited (BECMPL).
Rationale for Rating
The rating reaffirmation factors in the steady operating performance with modest order book which provides revenue visibility for the near term. The rating also factors in the promoters’ extensive experience, company’s long track record of operations and entity’s healthy financial risk profile. However, the rating remains constrained by moderate working capital management, exposure to geographic concentration risk and susceptibility of profitability to volatility in raw material prices in an intensely competitive industry.
About the Company
Based out in Maharashtra, Bharat Electrical Contractors and Manufacturers Private Limited (BECMPL) was incorporated in 2005, promoted & managed by Shri. Shantinath Adagonda Patil. The company is engaged in the activity of Electrical Contracting (execution of electrical contracts on turnkey basis). The company specializes in supplying materials and commissioning electrical installations, including transmission and distribution lines, power transformers, and substations. It primarily undertakes turnkey contracts, which cover the supply of materials, as well as the erection and commissioning of these installations. The current director of the company is Mr. Shri. Shantinath Adagonda Patil.
Unsupported Rating
Not Applicable
Analytical Approach
Acuite has considered the standalone business and financial risk profile of BECMPL to arrive at the rating.
Key Rating Drivers
Strengths
Experienced management and established track record of operations Incorporated in 2005, BECMPL is promoted by Mr. Shantinath Patil, who has nearly 40 years of experience in the EPC industry. The company has a long track record of operations in the execution of turnkey electrical contracts, primarily in the distribution systems sector. It purchases materials such as transformers, manufactures certain components, and handles erection and commissioning. The long track record of operations and management’s extensive experience in the EPC industry have helped the company develop strong relationships with its customers and suppliers. Acuité believes that BECMPL’s moderate order book position along with the experience of management and operational track record, will continue to support the business of the company.
Steady operating performance albeit modest order book position The operating income of the company improved to Rs.185.11 crore in FY2025 compared to Rs.80.34 crore in FY2024. The improvement in operating income is on the account of better execution of orders in hand. Further, BECMPL has achieved an operating income of approximately Rs.295 crore in FY2026 (Est.). However, the company has unexecuted orders of Rs.289.74 crore as on 31st December 2025 which gives revenue visibility for the near term. The company’s operating margin moderated to 7.22 per cent in FY2025 from 10.51 per cent in FY2024. The moderation in operating profitability was primarily driven by fluctuations in raw material prices. Further, the operating margin is estimated to have declined in FY2026 and is expected to remain in the range of 6.75–7.00 per cent. The PAT margin of the company improved to 3.87 per cent in FY2025 as against 3.23 per cent in FY2024 on account of reduced interest cost. Acuité believes that BECMPL’s operating performance would remain steady on the back of modest order book and new orders which are expected in near term.
Healthy Financial Risk Profile The financial risk profile of the company stood healthy, marked by moderate net worth, below unity gearing (debt-equity) and moderate debt protection metrics. The tangible net worth increased to Rs.105.04 crore as of March 31, 2025 and an increase from Rs.97.84 crore as of March 31, 2024, due to accretion of profits to reserves. The total debt of the company stood at Rs.3.96 crore which includes long term loans of Rs.0.14 crore, unsecured loans from directors/promoters of Rs. 3.15 Cr. and short-term loans (CC) of Rs.0.67 crore as on 31 March 2025. The gearing (debt equity) ratio improved to 0.04 times as on 31 March 2025 as compared to 0.07 times as on 31 March 2024. The debt protection metrics stood moderate with the Interest Coverage Ratio stood at 3.32 times for FY2025 as against 1.81 times for FY2024. Debt Service Coverage Ratio (DSCR) stood at 2.75 times in FY2025 as against 1.43 times in FY2024. Total outside Liabilities/Total Net Worth (TOL/TNW) stood at 0.69 times as on 31 March 2025 as against 0.77 times as on 31 March 2024. Net Cash Accruals to Total Debt (NCA/TD) stood at 1.96 times for FY2025 as against 0.49 times for FY2024. Acuité believes that the financial risk profile of the company will be healthy backed by steady accruals and no major debt funded capex plans.
Weaknesses
Moderate Working Capital Management The working capital management of the company is moderate marked by improved gross current asset (GCA) which stood at 126 days in FY2025 as against 344 days in FY2024. The high GCA days in FY2024 are attributed to elevated debtor collection days. The debtor’s collection period improved to 68 days in FY2025 as against 241 days for FY2024. The company allows 60-90 days credit period to its customers. Besides, majority of the orders are usually concentrated towards the end of every fiscal, with more than 50 percent of the sales in Q4, resulting in elevated working capital indicators for FY2024. The inventory days stood at 49 days in FY2025 as against 83 days in FY2024. Subsequently, the creditors’ days declined to 92 days in FY2025 as against 233 days in FY2024. The company allows credit period of 30-60 days to its suppliers. BECMPL’s reliance on working capital borrowings is moderate marked by average utilization of fund based working capital limits of ~46 per cent and that of non-fund based working capital limits of ~88 per cent during the last fourteen months period ended December 2025.
Exposure to geographical and customer concentration risk BECMPL bids for tenders only in the state of Maharashtra. The top two customers account for about 70 per cent of the total revenues. Heavy dependence on a few customers limits the bargaining power and exposes the company to risks relating to any change in their purchasing patterns. Any delay in payment could also stretch the working capital cycle. While this risk is mitigated by long standing relationships established with the customers, sustained reduction in dependence on a few customers, through new customer additions, remains a key rating sensitivity factor for the medium term.
Susceptibility of Profitability to the volatility in raw material prices in a Tender-Based Business in an intensely competitive industry
Tender-based operations limit pricing flexibility in an intensely competitive industry. Revenue and profitability depend entirely on the ability to win tenders. Entities in this segment face intense competition, which requires them to bid aggressively to procure contracts, thereby restricting operating margins to a moderate level. Additionally, given the cyclicality inherent in the construction industry, the ability to maintain profit margins through operating efficiency becomes critical.
Acuité believes that the company’s business and financial profiles could be adversely impacted due to the presence of stiff competition and the inherent risks associated with tender-based operations.
Rating Sensitivities
Potential triggers (individual or collective) for an upward rating action:
Sustained improvement in revenue and profitability with EBITDA above 10 per cent
Consistent Improvement in working capital cycle
Successful execution of orders in hand while securing substantial new orders
Potential triggers (individual or collective) for a downward rating action:
Significant decline in revenues and profitability
Deterioration in financial risk profile, with TOL/TNW above 3 times and DSCR below 1.5 times.
Elongation in working capital cycle
Liquidity Position
Adequate
The liquidity position remains adequate, evidenced by sufficient net cash accruals against no maturing debt obligations. Net cash accruals stood at Rs.7.76 crores in FY2025. The cash accruals are expected to be in the range of 10-13 crores between FY 2026 and FY2028, against no maturing debt obligation or minimal debt obligation during the same period. The current ratio stood at 1.10 times on March 31, 2025 which decline from 1.43 times on March 31, 2024. However, the reliance on working capital limits stood moderate marked by average utilization of fund based working capital limits of ~46 per cent and that of non-fund based working capital limits of ~88 per cent during the last fourteen months period ended December 2025. Going ahead, liquidity position of the company is expected to remain adequate on account of steady accruals against nominal repayment obligation and buffer available from unutilised limits.
Outlook: Stable
Other Factors affecting Rating
None
Particulars
Unit
FY 25 (Actual)
FY 24 (Actual)
Operating Income
Rs. Cr.
185.11
80.34
PAT
Rs. Cr.
7.17
2.59
PAT Margin
(%)
3.87
3.23
Total Debt/Tangible Net Worth
Times
0.04
0.07
PBDIT/Interest
Times
3.32
1.81
Status of non-cooperation with previous CRA (if applicable)
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.
Note - HDFC bank limited has Bank Gurantee (BG) of Rs.20 crores with Cash Credit (CC) as a sublimit of BG of Rs.0.50 crores.
Contacts
List of instruments and names of regulators of the instruments
