Press Release April 07, 2026 ARUN VYAPAR UDYOG PRIVATE LIMITED Rating Reaffirmed

Product	Quantum (Rs. Cr)	Long Term Rating	Short Term Rating
Bank Loan Ratings	32.50	ACUITE BBB- | Stable | Reaffirmed	-
Bank Loan Ratings	20.00	-	ACUITE A3 | Reaffirmed
Total Outstanding	52.50	-	-
Total Withdrawn	0.00	-	-

Rating Rationale

­Acuite has reaffirmed long-term rating of 'ACUITE BBB-' (read as ACUITE triple B minus) on Rs. 32.50 Cr. bank facilities and short term rating of  'ACUITE A3' (read as ACUITE A three) on Rs.20.00 Cr. of bank facilities of Arun Vyapar Udyog Private Limited (AVUPL). The outlook is ‘Stable'. Rationale for rating: The rating reaffirmation considers the extensive experience of AVUPL’s management and company’s  established track record of operations of over three decades in manufacturing and trading of TMT bars. The rating also considers the moderate financial risk profile with moderate debt coverage indicators, gearing level and efficient nature of working capital operations. The rating is, however, constrained by the modest scale of operations albeit thin profitability margins, susceptibility of profitability to fluctuations in the prices of metal and steel and geographical concentration risk.

About the Company

­Arun Vyapar Udyog Private Limited (AVUPL), incorporated in 1990, is engaged in the manufacturing and trading of Thermo Mechanical Treatment (TMT) bars under the brand name ‘Arun TMT’ at its manufacturing unit in Gummidipoondi (Tamil Nadu). The company is manufacturing TMT bars in different ranges from 8 mm to 32 mm diameter TMT bars. Directors of Arun Vyapar Udyog Private Limited are Ramasamy Packiam , Subhash Chandra Goel, Dhaneshwar Singh, Arun Madan, Umesh Kumar Madan, and Ramachandran Manokaran: the company currently has a rolling mill capacity of 120,000 MT per annum. AVUPL has associate concerns, namely Arun Smelters Pvt Ltd (manufacturing of MS billets) and Sri Annapurna Rerolling Private Limited.

Unsupported Rating

­Not applicable

Analytical Approach

­Acuite has considered standalone financial and business risk profile of Arun Vyapar Udyog Private Limited.

Key Rating Drivers

Strengths

­Experienced management and established track record of operations AVUPL was incorporated in 1990 by Mr. Umesh Madan and Mr. Deepak Madan. The company has a track record of operations of more than three decades in the iron and steel industry. The promoters have almost three decades of experience in the aforementioned industry. The company has a manufacturing facility located in Gummidipoondi (Tamil Nadu) with an installed capacity of 120,000 tons per annum. Acuité believes that the company will continue to benefit from its experienced management, which is likely to help company maintain long-standing relations with its customers and suppliers and improve operating performance over the medium term. Moderate financial risk profile The financial risk profile of the company is moderate marked by moderate net worth, moderate capital structure and debt protection metrics. The net worth of the company stood at Rs.46.79 Cr. and Rs.39.68 Cr. as on March 31, 2025, and 2024 respectively, led by accretion of profit to reserves. The unsecured loan to the tune of Rs.22.95 Cr. has been considered as quasi equity. Gearing of the company stood at 1.29 times as on March 31, 2025, against 1.29 times as on March 31, 2024. Debt protection metrics – Interest coverage ratio and debt service coverage ratio stood at 1.51 times and 1.33 times as on March 31, 2025, respectively as against 1.74 times and 1.45 times as on March 31, 2024, respectively. Tol/ TNW stood at 2.07 times as on March 31, 2024, as against 2.22 times as on March 31, 2024. The debt to EBITDA of the company stood at 4.39 times on as on March 31 2025 as against 5.28 times in FY2024. Acuité expects the financial risk profile of the company to remain moderate  over the medium term in the absence of any major debt-funded capital expenditure. Efficient working capital operations AVUPL has efficient working capital operations marked by gross current assets of 91 days in FY2025 as against 87 days in FY2024. The company sells its product through distributor network spread across Chennai. The company also receives advance payment against sales and remaining amount is received within 1 month. Inventory days stood at 62 days as on March 31, 2025, as against 58 days as on March 31, 2024.  The debtor day stood at 23 days as on March 31, 2025, as against 21 days as on March 31, 2024.  Creditors’ days stood at 24 days as on March 31, 2025, as against 26 days as on March 31, 2024. The company procures around 25% of raw material majorly from Singapore and remaining is domestically procured, from Tamil Nadu. The raw material is imported against LC. Acuite believes, the working capital operations are expected to remain efficient in near to medium term.

Weaknesses

Modest scale of operations couple with thin profitability margins The company has reported moderate growth in operating income with Y-o-Y growth of 7.80 percent as reflected in revenues of Rs. 472.13 Cr. in FY2025 as against Rs. 437.97 Cr. in FY2024 which is led by increased volumes. The EBITDA margins of the company are range bound which stood at 2.88 percent in FY2025 as compared to 2.15 percent in FY2024 and 2.15 percent in FY2023.  In current fiscal, the company has achieved revenues worth Rs. 350.32 Cr. till Dec  2025. Acuité believes that the company’s operating performance is expected to be modest on account of nature of business. ­Geographical concentration The company derives 100% of its revenue from Tamil Nadu and has tie-up with 3-4 distributors through which sale is made. This exposes the company to significant geographical concentration risk.   Vulnerability of margins to fluctuations in the prices of metal and steel The profitability is susceptible to volatility in raw material prices of iron and steel products. The company operates in a highly fragmented and competitive industry with a large number of organized and unorganized players.

Rating Sensitivities

Potential triggers (individual or collective) for an upward rating action:

­Consistent growth in revenues and profitability by over 20% Improvement in financial risk profile with gearing below 1 time and DSCR above 2.5 times

Potential triggers (individual or collective) for a downward rating action:

­Lower than expected revenues and profitability. Any large debt funded capex, impacting the financial risk profile with DSCR falling below 1 time.

Liquidity Position

Adequate

Company’s liquidity is adequate with net cash accruals (NCAs) of Rs.3.92 Cr. in FY2025, as against debt obligations of Rs. 0.66 Cr. during the same period. Going forward, the company is expected to generate cash accruals in the range of Rs. 5-6 Cr. net cash accruals against its repayment obligations of Rs. 0.71-1.10 Cr. The company has maintained unencumbered cash and bank balances Rs. 0.03 Cr. and the current ratio stood at 1.68 times as on March 31, 2025. The fund-based bank utilization of AVUPL is 72  percent for fund based for the past 12 months ended December 2025. Acuité expects that the liquidity of the company is likely to remain adequate over the medium term on account of moderate cash accruals over the medium term.

Outlook: Stable

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Other Factors affecting Rating

­None

Key Financials

Particulars	Unit	FY 25 (Actual)	FY 24 (Actual)
Operating Income	Rs. Cr.	472.13	437.97
PAT	Rs. Cr.	2.30	2.12
PAT Margin	(%)	0.49	0.48
Total Debt/Tangible Net Worth	Times	1.29	1.29
PBDIT/Interest	Times	1.51	1.74

Status of non-cooperation with previous CRA (if applicable)

­Not applicable.

Any other information

­None.

Applicable Criteria

• Default Recognition :- https://www.acuite.in/view-rating-criteria-52.htm • Manufacturing Entities: https://www.acuite.in/view-rating-criteria-59.htm • Application Of Financial Ratios And Adjustments: https://www.acuite.in/view-rating-criteria-53.htm

Note on complexity levels of the rated instrument

­In order to inform the investors about complexity of instruments, Acuité has categorized such instruments in three levels: Simple, Complex and Highly Complex. Acuite’s categorisation of the instruments across the three categories is based on factors like variability of the returns to the investors, uncertainty in cash flow patterns, number of counterparties and general understanding of the instrument by the market. It has to be understood that complexity is different from credit risk and even an instrument categorized as 'Simple' can carry high levels of risk. For more details, please refer Rating Criteria “Complexity Level Of Financial Instruments” on www.acuite.in.

Rating History

Date Name of Instruments/Facilities Term Amount (Rs. Cr) Rating/Outlook 15 Jan 2025 Letter of Credit Short Term 9.00 ACUITE A3 (Reaffirmed) Proposed Short Term Bank Facility Short Term 11.00 ACUITE A3 (Reaffirmed) Cash Credit Long Term 18.00 ACUITE BBB- | Stable (Reaffirmed) Cash Credit Long Term 14.50 ACUITE BBB- | Stable (Assigned) 27 Oct 2023 Letter of Credit Short Term 15.00 ACUITE A3 (Reaffirmed) Letter of Credit Short Term 5.00 ACUITE A3 (Assigned) Cash Credit Long Term 13.00 ACUITE BBB- | Stable (Reaffirmed) Cash Credit Long Term 5.00 ACUITE BBB- | Stable (Assigned)

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Annexure - Details of instruments rated

Lender’s Name ISIN Facilities Date Of Issuance Coupon Rate Maturity Date Quantum (Rs. Cr.) Complexity Level Rating ICICI BANK LIMITED Not avl. / Not appl. Cash Credit Not avl. / Not appl. Not avl. / Not appl. Not avl. / Not appl. 32.50 Simple ACUITE BBB- | Stable | Reaffirmed ICICI BANK LIMITED Not avl. / Not appl. Letter of Credit Not avl. / Not appl. Not avl. / Not appl. Not avl. / Not appl. 15.00 Simple ACUITE A3 | Reaffirmed Not Applicable Not avl. / Not appl. Proposed Short Term Bank Facility Not avl. / Not appl. Not avl. / Not appl. Not avl. / Not appl. 5.00 Simple ACUITE A3 | Reaffirmed

Contacts

Mohit Jain Chief Analytical Officer - Rating Operations Moparthi Anuradha Devi Senior Analyst - Rating Operations	Contact details exclusively for investors and lenders Mob: +91 8591310146 Email ID: analyticalsupport@acuite.in

About Acuité Ratings & Research

Acuité is a full-service Credit Rating Agency registered with the Securities & Exchange Board of India (SEBI). The company received RBI Accreditation as an External Credit Assessment Institution (ECAI) for Bank Loan Ratings under BASEL-II norms in the year 2012. Acuité has assigned ratings to various securities, debt instruments and bank facilities of entities spread across the country and across a wide cross section of industries. It has its Registered and Head Office in Kanjurmarg, Mumbai. Disclaimer: An Acuité rating does not constitute an audit of the rated entity and should not be treated as a recommendation or opinion that is intended to substitute for a financial adviser's or investor's independent assessment of whether to buy, sell or hold any security. Ratings assigned by Acuité are based on the data and information provided by the issuer and obtained from other reliable sources. Although reasonable care has been taken to ensure that the data and information is true, Acuité, in particular, makes no representation or warranty, expressed or implied with respect to the adequacy, accuracy or completeness of the information relied upon. Acuité is not responsible for any errors or omissions and especially states that it has no financial liability whatsoever for any direct, indirect or consequential loss of any kind, arising from the use of its ratings. Ratings assigned by Acuité are subject to a process of surveillance which may lead to a revision in ratings as and when the circumstances so warrant. Please visit our website (www.acuite.in) for the latest information on any instrument rated by Acuité. Please visit https://www.acuite.in/faqs.htm to refer FAQs on Credit Rating. Note: None of the Directors on the Board of Acuité Ratings & Research Limited are members of any rating committee and therefore do not participate in discussions regarding the rating of any entity.