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 assigned the long term rating of 'ACUITE A-' (read as ACUITE A minus) on the Rs. 80.90 Cr. bank facilities of Alankar Alloys Private Limited (AAPL). The outlook is 'Stable'
Rationale for rating
The rating assigned reflects the improvement in the business risk profile of the group, marked by the significant improvement in the operating revenue and profitability in FY2026 largely driven by the commencement of backward integration operations of sponge iron, ferro alloy manufacturing and captive power plant at Gauri Ganesh Ispat Private Limited. The rating also considers the integrated business operations of the group, that provide operational efficiency and cost control. Further, the manufacturing units of the group are located in Chhattisgarh which provides close proximity and easy access to key raw materials such as iron ore and steel. The rating also factors in the experienced management and established market presence of the group. The rating takes into account the moderately intensive working capital operations of the group. These strengths are, however, partly offset by the moderate financial risk profile owing to recent debt funded capex and cyclical nature of the steel industry with volatility in commodity prices. Going forward, the ability of the group to improve its production and sales volume along with improvement in realisations and its impact on the financial risk profile will remain a key rating sensitivity factor.
About The Company
Incorporated in 2006, Alankar Alloys Private Limited (AAPL) is a Raipur, Chhattisgarh based company, engaged in manufacturing of MS billets and TMT bars. Currently, the company is headed by Ms. Usha Devi Agrawal, Mr. Akash Kumar Agrawal and Mr. Lalit Kumar Agrawal. The company has an installed capacity of 144000 MTPA of billets and 130000 MTPA of TMT bars.
About the Group
Pankaj Ispat Private Limited (PIPL)
Incorporated in 2006, Pankaj Ispat Private Limited (PIPL) is a Raipur, Chhattisgarh based company, engaged in manufacturing of MS ingots and TMT bars. Currently, the company is headed by Mr. Pankaj Agarwal, Mr. Lalit Agarwal, and Ms. Poojan Agrawal. The company has an installed capacity of 45000 MTPA of Ingots and 54000 MTPA of TMT bars.
Sourabh Rolling Mills Private Limited (SRMPL)
Incorporated in 2004, Sourabh Rolling Mills Private Limited (SRMPL) is a Raipur based company, engaged in manufacturing of MS billets, pipes, TMT bars and strips. Currently, the company is headed by Mr. Pankaj Agrawal, Mr. Akash Kumar Agrawal and Mr. Lalit Agrawal. The company has a capacity of 169920 MTPA of billets and 144000 MTPA of rolling products/strips and 90000 MTPA of pipes.
Gauri Ganesh Ispat Private Limited (GGIPL)
Incorporated in 2021, Gauri Ganesh Ispat Private Limited is a Raipur based company, engaged in manufacturing of sponge iron and ferro alloys. The company commenced commercial operations from February 2025 onwards. The company has also installed a 20 MW captive power plant, out of which 12 MW is based on waste heat recovery and 8 MW is a thermal plant. Currently, the company is headed by Mr. Pankaj Agrawal, Mr. Akash Kumar Agrawal and Mr. Lalit Agrawal. The company has an installed capacity of 198000 MTPA of sponge iron and 29700 MTPA of ferro alloys.
Unsupported Rating
Not Applicable
Analytical Approach
Extent of Consolidation
•Full Consolidation
Rationale for Consolidation or Parent / Group / Govt. Support
Acuite has consolidated the business and financial risk profile of Alankar Alloys Private Limited (AAPL), Pankaj Ispat Private Limited (PIPL), Sourabh Rolling Mills Private Limited (SRMPL) and Gauri Ganesh Ispat Private Limited (GGIPL). These entities are together referred as Pankaj Group. The consolidation is in view of common management, strong operational and financial linkages among the entities and similar line of business. Further, SRMPL and PIPL have provided corporate guarantee towards the debt availed by GGIPL.
Key Rating Drivers
Strengths
Experienced management and established track record of operations
The key promoters of the Pankaj group, Mr. Lalit Agarwal and Ms. Usha Devi Agrawal have been associated with the iron & steel industry for more than three decades. In addition to this, the second generation promoters Mr. Pankaj Agarwal, Ms. Pooja Agrawal and Mr. Akash Agrawal are now involved with the day to day operations of the group. This helped them established a strong market position and brand name and has built healthy relationships with their customers and suppliers.
Improved operating performance supported by backward integrations
While the revenues of AAPL, SRMPL and PIPL remained flat for the last two years due to continuous decline in the realization prices and supported by volume growth, the overall revenue of the group improved significantly by ~25 percent in FY2026 (Prov.) to 1,671.33 Cr. from Rs. 1,333.23 Cr. in FY2025 driven by commencement of commercial operations of GGIPL. GGIPL completed its first full year of operation in FY2026. Further, the EBITDA margin of the group improved significantly to 9.24 percent in FY2026 (Prov.) from 4.19 percent in FY2025, majorly on account of reduction in the power cost due to installation of captive power plant in GGIPL along with reduction in material costs due backward integration material supply by GGIPL to its other group companies. The PAT margin improved to 3.02 percent in FY2026 (Prov.) from 0.92 percent in FY2025. Till May 2026, the group has achieved a revenue of ~Rs. 405 Cr.
Going forward, the ability of the group to improve its topline through growth in sales volume and realisations will be a key monitorable.
Moderately intensive working capital operations
The working capital operations of the group are moderate marked by gross current assets (GCA) of 140 days in FY2026 (Prov.) [157 days in PY]. The GCA are driven by the inventory levels of 86 days, receivable levels of 24 days in FY2026 (Prov.) and other current assets majorly comprising of advances to suppliers and balances with government authorities. The creditor days stood at 47 in FY2026 (Prov.) as against 57 days in FY2025. The average bank limit utilization stood at ~82 percent for the last six months ended March 2026.
Weaknesses
Moderate financial risk profile on account of significant debt funded capex
The financial risk profile of the group is marked by healthy networth, moderate gearing and comfortable debt protection metrics. The tangible networth of the group stood at Rs. 342.18 Cr. on March 31, 2026 (Prov.) as against Rs. 281.68 Cr. on March 31, 2025. The total debt of the group increased in FY2025 due to capex undertaken under GGIPL and further in FY2026 due to increase in the working capital utilization. Therefore, gearing levels stood moderate at 1.71 in FY2026 (Prov.) and at 1.80 times in FY2025. The TOL/TNW levels stood at 2.44 times in FY2026 (Prov.) (2.73 times in PY). However, the interest coverage ratio (ICR) stood comfortable at 2.68 times along with debt service coverage ratio (DSCR) of 2.23 times in FY2026 (Prov.)
The financial risk profile of the group is expected to improve gradually with increase in accruals and in the absence of any significant debt funded capex plans of the medium term.
Susceptibility to volatility in raw material prices and cyclicality inherent in the steel industry
The group’s performance remains vulnerable to growing competition and the inherently cyclical nature of the steel industry, which is closely linked to both domestic and global economic conditions. The key end-user sectors like real estate, infrastructure, and engineering also exhibit cyclical trends. Consequently, fluctuations in economic cycles such as slowdowns and seasonal variations in demand and supply can affect steel demand and its pricing, thereby exerting pressure on the group’s operating margins and cash flows, which shall continue to remain key rating monitorable. Additionally, the group faces intense competitive pressures from a large number of organised and unorganised players.
ESG Factors Relevant for Rating
On the environmental front, the group has successfully installed and commissioned at 12 MW waste heat recovery based power plant that uses waste gas from the sponge iron kiln to manufacture energy. The board of directors comprises of individuals having expertise and experience of more than three decades in the industry. Further, the group has developed an ethical business policy to ensure a healthy governance mechanism.
Rating Sensitivities
Potential triggers (individual or collective) for an upward rating action:
Improvement in the revenue at sustained profitability margins leading to generation of net cash accruals higher than Rs. 120 – 130 Cr.
Improvement in financial risk profile with gearing reducing below unity
Potential triggers (individual or collective) for a downward rating action:
Decline in operating performance with net cash accruals falling below Rs. 70 - 80 Cr
Any significant increase in debt levels affecting the financial risk profile
Elongation in the working capital cycle
Liquidity Position
Adequate
The group generated net cash accruals (NCAs) of Rs. 86.92 Cr. against minimal repayment obligations of Rs. 6.66 Cr. in FY2026 (Prov.). Going forward, the NCAs are expected to remain in the range of Rs. 95 – 110 Cr. against maturing repayment obligations of ~36 Cr. each in FY2027 and FY2028. The current ratio stood at 1.09 times in FY2026 (Prov.). The average bank limit utilization stood at ~82 percent for the last six months ended March 2026. Further, the group has an unencumbered cash and bank balance of Rs. 9.19 Cr. on March 31, 2026 (Prov.)
Outlook: Stable
Other Factors affecting Rating
None
Particulars
Unit
FY 26 (Provisional)
FY 25 (Actual)
Operating Income
Rs. Cr.
1671.33
1333.23
PAT
Rs. Cr.
50.43
12.33
PAT Margin
(%)
3.02
0.92
Total Debt/Tangible Net Worth
Times
1.71
1.80
PBDIT/Interest
Times
2.68
2.79
Status of non-cooperation with previous CRA (if applicable)
ACUITE BB+
(Reaffirmed & Withdrawn & Issuer not co-operating*)
Covid Emergency Line.
Long Term
6.42
ACUITE BB+
(Reaffirmed & Withdrawn & Issuer not co-operating*)
Cash Credit
Long Term
40.00
ACUITE BB+
(Reaffirmed & Withdrawn & Issuer not co-operating*)
10 Oct 2023
Cash Credit
Long Term
40.00
ACUITE BB+
(Downgraded & Issuer not co-operating* from ACUITE BBB | Stable)
Covid Emergency Line.
Long Term
3.58
ACUITE BB+
(Downgraded & Issuer not co-operating* from ACUITE BBB | Stable)
Covid Emergency Line.
Long Term
6.42
ACUITE BB+
(Downgraded & Issuer not co-operating* from ACUITE BBB | Stable)
Lender’s Name
ISIN
Facilities
Listing Status
Regulated By
Date Of Issuance
Coupon Rate
Maturity Date
Quantum (Rs. Cr.)
Complexity Level
Rating
Punjab National Bank
Not avl. / Not appl.
Cash Credit
Unlisted
RBI
Not avl. / Not appl.
Not avl. / Not appl.
Not avl. / Not appl.
53.00
Simple
ACUITE A- | Stable | Assigned
YES BANK LIMITED
Not avl. / Not appl.
Cash Credit
Unlisted
RBI
Not avl. / Not appl.
Not avl. / Not appl.
Not avl. / Not appl.
27.00
Simple
ACUITE A- | Stable | Assigned
Punjab National Bank
Not avl. / Not appl.
Term Loan
Unlisted
RBI
Not avl. / Not appl.
Not avl. / Not appl.
30 Nov 2027
0.90
Simple
ACUITE A- | Stable | 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.
*Annexure 2 - List of Entities (applicable for Consolidation or Parent / Group / Govt. Support)
Sr No
Company Name
1
Alankar Alloys Private Limited
2
Pankaj Ispat Private Limited
3
Sourabh Rolling Mills Private Limited
4
Gauri Ganesh Ispat Private Limited
Contacts
List of instruments and names of regulators of the instruments
