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 upgraded its long-term rating to 'ACUITE BBB-' (read as ACUITE triple B minus) from 'ACUITE BB-' (read as ACUITE double B minus) on Rs. 450.00 Cr. Non-Convertible Debentures (NCD) of Suruchi Properties Private Limited (SPPL). The outlook is 'Stable'.
Rationale for rating
The rating upgrade takes into account the healthy sales momentum of the company’s ongoing real estate project – Century Regalia, supported by strong collection efficiency. Further, the rating derives strength from the company’s healthy liquidity position and its prudent approach towards debt prepayment. Moreover, the rating factors release of security charge on cashflows of Wintersun Phase 2 project by the lender in May 2026, despite which the security cover remains improved and healthy. However, the rating remains constrained by moderate project execution risk due to lower-than-expected project progress along with significant geographical concentration risk, high exposure to group entities and inherent cyclicality in the real estate industry. Additionally, the rating continues to reflect the established track record of the Century Group in the Bengaluru real estate market, which mitigates demand risk to a certain extent.
About the Company
Incorporated in 2003, Suruchi Properties Private Limited (SPPL) is a real estate company, part of the Century Group, based in Bengaluru. The company is engaged in execution of residential and commercial project and is managed by Mr. Ashwin Pai and Mr. Ravindra Pai. Currently, SPPL is engaged in development of residential project namely Century Regalia (interchangeably known as Golfview/Build Rare) located at Indiranagar, Bangalore with total saleable area of 8,95,180 sq. ft.
Unsupported Rating
Not Applicable
Analytical Approach
Acuité has considered the standalone business and financial risk profile of SPPL to arrive at the rating.
Key Rating Drivers
Strengths
Established track record of operations Suruchi Properties Private Limited (SPPL) is part of the Century Group and operates as a wholly owned subsidiary of Century Joint Developments Private Limited (rated ACUITE B-/Stable), which is itself a wholly owned subsidiary of Century Real Estate Holdings Private Limited. Backed by over five decades of experience in the real estate sector, the Century Group is a well-established and prominent developer in Bengaluru. The group holds a significant land bank of more than 3,000 acres and currently has over 20 million sq. ft. of real estate projects under development. Moreover, in May 2026, the lender released the security charge on the cash flows of the group's Wintersun Phase 2 project, owing to the sustained improvement in Project Regalia. Moreover, excluding Wintersun project, the project Regalia holds a security cover of over 3.0 times as on March 31, 2026, comfortably above the minimum covenant requirement of 2.25 times.
Healthy sales momentum The company has achieved healthy sales traction, with ~58 percent of the total saleable area sold as of April 2026, generating sales of Rs. 1,300+ Cr. with collection efficiency of ~45 percent. The average selling price per sq. ft. has also been improving, supported by the gradual progress in project construction. Going forward, the company plans to meet the remaining project cost and debt repayments through customer collections, therefore, timely receipt of collections of receivables and continued sales momentum will remain key rating monitorable.
Weaknesses
Moderate project execution risk The construction of project Regalia remains at a moderate stage, with 22.74 percent of the total construction cost incurred as of April 2026. This progress is lower than previously envisaged due to labour shortages encountered during the West Bengal elections, which affected the pace of execution. Consequently, the total project cost has increased by ~3.2 percent. The physical construction for phase I is completed up to 9th floor (out of total 11 floors) and for phase II, the project is currently at basement level, with expected slab work to commence from August 2026. As a substantial portion of the project expenditure is yet to be incurred over the medium term, the project remains exposed to execution and implementation risks.
Geographical concentration risk and significant exposure to group companies SPPL’s business profile remains vulnerable to geographical concentration, with its ongoing project in Bangalore. Until the company diversifies into other regions, this concentration exposes it to localized demand fluctuations and competitive pressures from established developers in the area. Furthermore, the company continues to remain exposed to intense competition from the established real estate developers in Bangalore. However, these risks are mitigated to some extended with established position and track record of Century Group in Bangalore. Moreover, the company has extended significant support to the group entities amounting to Rs. 496 Cr. as on March 31, 2026 for their ongoing projects and working capital requirements, any significant increase in which shall remain a key rating sensitivity.
Susceptibility to cyclicality inherent in the Indian real estate industry The real estate segment in India is cyclical and affected by volatile prices and opaque transactions. Further, the real estate industry in India is highly fragmented, with most developers having a city-specific or region-specific presence. The risks associated with the industry are cyclical in nature and directly linked to fluctuations in property prices and interest rates, which could affect the sales velocity and the operations of the project. Moreover, the industry is also exposed to certain regulatory policies and regulations which directly impacts the demand and operating growth of real estate players. Further, the company continues to remain exposed to intense competition from established players in the industry. Hence, business risk profile of the company will remain susceptible to risks arising from any industry slowdown.
Assessment of Adequacy of Credit Enhancement under various scenarios including stress scenarios (applicable for ratings factoring specified support considerations with or without the “CE” suffix)
SPPL maintains a debt service reserve account (DSRA) equivalent to one quarter of interest obligations along with escrow mechanism.
Stress case Scenario
Acuité believes that, given the presence of DSRA and escrow mechanism, SPPL will be able to service its debt on time, even in a stress scenario.
ESG Factors Relevant for Rating
The group is committed to improving their performance in Environmental, Social, and Governance (ESG) factors through practices in its project development by deploying a zero liquid discharge system, low-flow sanitary fixtures, and curing compounds to reduce water usage. It actively promotes green building standards especially LEED certifications for its projects, uses solar modules, energy-efficient fixtures, and 5-star rated appliances to cut carbon emissions, and tracks pollutants via the GHG Protocol. Further, the group does not engage in forced labour or child labour, and has strict policies in place to prevent such practices. It also promotes diversity & inclusion through its equal opportunity hiring policy that prohibits discrimination based on caste, gender, religion, etc. Moreover, on the governance; the parent company has an internal compliance committee, led by a dedicated compliance officer, responsible for ensuring compliance with all relevant regulations.
Rating Sensitivities
Potential triggers (individual or collective) for an upward rating action:
Higher-than-expected sales of inventory along with timely receipt of customer advances
Improvement in the project progress with timely completion of project
Potential triggers (individual or collective) for a downward rating action:
Delay in completion of the ongoing real estate projects resulting in cost overruns or lower than expected sales resulting in project’s average DSCR falling below 1.5 times
Significant increase in exposure to group entities in the form of loans & advances
All Covenants
Issuer to maintain at least 1 quarter of working capital requirement based on Business Plan for the Projects and DSRA at all times.
Value of mortgaged property to be always at least INR 1,018 Cr.
Minimum security cover of 2.25x of outstanding amounts under the facility to be maintained at all times.
Minimum Collection Efficiency of 90% to be maintained.
Surplus above minimum cash requirements (next 3 months working capital requirements for projects and DSRA) shall be sweeped to prepay the facility on quarterly basis subject to minimum Cash Sweep of INR 5 Cr.
Liquidity Position
Adequate
SPPL’s liquidity is adequate supported by collections of customer advances from the projects in order to repay its debt obligations. Further, the average debt service coverage ratio (DSCR) of the company is expected to be around ~2.40 times over the debt tenure. Moreover, the liquidity is supported by healthy cash and bank balances of ~Rs. 190 Cr. as of March 31, 2026 (including DSRA parked in the form of fixed deposits). Furthermore, the maturing debt obligations of the company till March 2027 is scheduled at Rs. 100 Cr. (including principal and redemption premium) against which the company has already prepaid debt obligations amounting to Rs. 116.62 Cr. as of May 11, 2026. However, the company has sizeable loans and advances outstanding to group entities of approximately Rs. 496 Cr., and any material increase in these exposures that adversely affects liquidity will remain monitorable.
Outlook: Stable
Other Factors affecting Rating
None
Particulars
Unit
FY 26 (Actual)
FY 25 (Actual)
Operating Income
Rs. Cr.
0.00
0.00
PAT
Rs. Cr.
(3.53)
0.99
PAT Margin
(%)
0.00
0.00
Total Debt/Tangible Net Worth
Times
(103.55)
(5278.62)
PBDIT/Interest
Times
0.93
1.03
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.
Contacts
List of instruments and names of regulators of the instruments
