Press Release October 01, 2026 DECCAN FERRO ALLOYS PRIVATE LIMITED Rating Reaffirmed

Product	Quantum (Rs. Cr) (SEBI)	Quantum (Rs. Cr) (Other FSR)	Long Term Rating	Short Term Rating	Regulated By
Bank Loan Ratings	0.00	30.00	ACUITE BBB+ | Stable | Reaffirmed	-	RBI
Bank Loan Ratings	0.00	65.00	-	ACUITE A2 | Reaffirmed	RBI
Total Outstanding	0.00	95.00	-	-	-
Total Withdrawn	0.00	0.00	-	-	-

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 reaffirmed the long-term rating to 'ACUITE BBB+' (read as ACUITE triple B plus) and short term to  ‘ACUITE A2’ (read as ACUITE A two) on the Rs.95.00 crore bank facilities of Deccan Ferro Alloys Private Limited (DFAPL). The outlook is ‘Stable’. Rationale for rating reaffirmation The rating reaffirmation reflects the steady operating performance of the company with marginal moderation in revenues in FY2026. Further, the rating also reflects the management’s long track record in the industry and healthy financial profile characterized by healthy net worth, low gearing and strong debt protection metrics. The rating also draws comfort from the adequate liquidity position of the group, aided by efficient working capital management and cushion available in the group’s working capital limits. However, the ratings are constrained by susceptibility of profitability to volatility in raw material prices, highly fragmented and intensely competitive industry and forex risk.

About the Company

Deccan Ferro Alloys Private Limited (DFAPL) was incorporated in 2000. The company is engaged in manufacturing of ferro chrome, ferro manganese and silico manganese. The company has a production facility in Visakhapatnam, Andhra Pradesh with an installed capacity of 39000 MT per annum. Directors of the company are Mr. Sivarama Raju Pericherla and Mr. Sirisha Ayinampudi.

About the Group

Chhattisgarh Steel and Power Limited (CSPL) Chhattisgarh based, CSPL was incorporated in 2003. The company is primarily involved in manufacturing of ferro/silico-manganese products and is established in 150 acres of land in Champa, Chhattisgarh. The facility includes its own 30MW coal based captive power plant and 2x16.5 MVA Ferro Alloys furnaces. DFAPL initiated the acquisition process on September 1, 2023, which was completed on March 31, 2024. DPAPL initially acquired a 51.79 percent stake in CSPL, and in FY25, its holding has increased to 56.67 percent. Mr. Ramesh Singh Thakur, Ms. Lakshmi Lavanya Pannasa, Mr. Surendrapal Neware, Mr. Suresh Marpu, and Mr. Appalaraju Ayinampudi are directors of the company. Vijaynagar Ispat and Alloys Private Limited (VIAPL) Andhra Pradesh based, VIAPL was incorporated in 2021. VIAPL is a 100 percent subsidiary of DFAPL. Directors of the company are Mr. Sivarama Raju Pericherla and Mr. Sirisha Ayinampudi. The company does not have any operations.

Unsupported Rating

­Not Applicable

Analytical Approach

Extent of Consolidation

•Full Consolidation

Rationale for Consolidation or Parent / Group / Govt. Support

­Acuité has consolidated the business and financial risk profiles of Deccan Ferro Alloys Private Limited (DFAPL), Chhattisgarh Steel and Power Limited (CSPL) and Vijaynagar Ispat and Alloys Private Limited (VIAPL). The consolidation is in the view of common promoters and management, intercompany holdings, operational linkages between the entities and a similar line of business. Collectively, these entities are referred to as the "Deccan Group".

Key Rating Drivers

Strengths

Experienced management and long track record of operations Promoters of the group are associated with the ferro alloys industry for over two decades. The group has a strong customer base which includes reputed steel players such as JSW Steel Limited, Arcelor Mittal Nippon Steel India Limited, Rashtriya Ispat Nigam Limited among others. The company has been associated with their key customers almost since inception. Acuite believes that the extensive experience of the promoter would continue to help in the business risk profile of the group going forward. Steady operating performance The group reported slight moderation in the revenue which stood at Rs. 479.10 Cr. in FY2026(prov.) as against Rs. 494.62 Cr. in FY2025. The subdued revenue in FY2026 (Prov.) was primarily due to the maintenance of plant undertaken in CSPL in FY26 for around a period of 1 month and due to lower sales volume. Further, the group reported revenue of Rs. 207.76. Cr. in 5MFY27.  The group reported moderate improvement in EBITDA margin that stood at 6.58 percent in FY2026(Prov.) as against 6.01 percent in FY2025 due to efficient cost management. Subsequently, the net profit margin of the group stood at 3.36 percent in FY2026(prov.) as against 3.24 percent in FY2025. Acuite believes the group's ability to scale up its operations and profitability margins shall remain a key rating sensitivity.  Healthy Financial Risk Profile The financial risk profile of the group remained healthy marked by healthy net worth, low gearing and strong debt protection metrics. The net worth of the group stood at Rs.198.02 crore as on 31 March 2026(prov.) as compared to Rs.181.85 crore as on 31 March 2025 due to accretion of profits to reserves. The gearing of the group stood comfortable at 0.27 times as on March 31, 2026(Prov.) as against 0.24 times as on March 31, 2025. The total debt of the group stood at Rs. 54.06 Cr. as on March 31, 2026(Prov.) as against Rs.44.23 Cr. as on March 31, 2025. The total debt of Rs. 54.06 Cr. consists of Rs. 2.33 Cr. of long-term debt, Rs. 12.19 Cr. of USL from directors/ promoters, Rs. 38.86 Cr. of short-term debt and CPLTD of Rs. 0.69 Cr. TOL/TNW stood at 0.82 times as on March 31, 2026(prov.) as against 0.79 times as on March 31, 2025. Interest coverage ratio (ICR) improved and stood at 8.03 times in FY2026(Prov.) as against 5.58 times in FY2025. Also, the debt service coverage ratio (DSCR) improved and stood at 6.09 times in FY2026(Prov.) as against 4.80 times in FY2025.  The company has commenced a modernization program at the CSPL facility from December 2025 which is expected to be completed by September 2027. The total project cost is estimated at around Rs. 50 crores, of which approximately Rs. 37 crores will be funded through a term loan and rest through promoters’ contribution/Internal accruals. The company has incurred cost of around Rs. 40 Cr till August 2026 through term loans of Rs. 21.50 and rest through promoters’ contribution. The benefits arising from the modernization initiatives, including enhanced operational efficiency and capacity utilization to further benefit the performance of FY2028. Acuite believes that the financial risk profile of the group is expected to moderate marginally due to the debt-funded capex; however, it is expected to remain healthy over the near to medium term, supported by healthy cash accruals and net worth base. Moderately efficient Working capital cycle The working capital cycle of the group is moderately efficient marked by gross current asset (GCA)   of 129 days in FY2026(Prov.) as against 108 days in FY2025. The debtor days stood at 16 days in FY2026(prov.) as compared to 09 days in FY2025. The inventory days stood at 78 days in FY2026(Prov.) against 71 days in 2025. The creditor days stood at 94 days in FY2026(Prov.) as compared to 77 days in FY2025. The average bank limit utilisation for the six months ended June 2026 stood at ~36.39 percent for fund-based facilities and 64.67 percent for non-fund-based facilities. Acuite believes that the working capital cycle of the company will remain moderately efficient in near to medium term owing to the nature of the business.

Weaknesses

Susceptibility of profitability to volatility in raw material prices and forex risk The group’s profitability is highly susceptible to volatility in prices of the key raw material. Any sharp upward movement in the raw material prices and the inability of the group to pass on the increased cost of raw materials may result in dip in the operating margins. The company is also exposed to foreign exchange risk; however, it is partially mitigated through forward contracts. Acuite believes, the profit margins of the group likely to remain exposed to volatility in raw material prices and forex risk.   Highly fragmented and intensely competitive industry The ferro alloys industry is marked by the presence of a large number of organized and unorganized players owing to low entry barriers. The company faces intense competition from the presence of several mid to large sized players in this industry. The presence of a large number of players has a direct impact on pricing, restricts bargaining power having an adverse impact.

Rating Sensitivities

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

- Significant growth in revenues surpassing Rs. 750 Cr while improving profitability margins -Improvement in working capital cycle -Improvement in financial risk profile

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

-Significant decline revenues and profitability -Deterioration in financial risk profile on the back of unexpected additional debt funded capex or working capital borrowings with debt to EBITDA above 3.00 times on sustained basis -Elongation in working capital cycle

Liquidity Position

Adequate

The Group’s liquidity profile is adequate as reflected from its healthy net cash accruals of Rs.24.19 Cr. in FY26(Prov.) as against nominal debt repayment obligation of Rs. 0.48 Cr. during the same period. Going forward, the group is expected to generate net cash accruals of ~Rs. 25 Cr. and ~Rs. 30 Cr against is debt obligation of ~Rs. 0.69 Cr. and ~Rs. 6.16 Cr. during FY27 and FY28 respectively. The average bank limit utilisation for the six months ended June 2026 stood at 36.39 percent for fund-based facilities and 64.67 percent for non-fund-based facilities. The working capital cycle of the group is moderately efficient marked by decreasing GCA days that stood at 129 days in FY2026(Prov.) as against 108 days in FY2025. The current ratio stood modest at 1.27 times as on March 31, 2026(Prov.). The cash balance of the group stood at Rs. 5.84 Cr. as on March 31, 2026(Prov.). Acuite believes that the liquidity of the group is likely to remain adequate over the medium term on account of adequate cash accrual over the medium term against repayment obligations.

Outlook: Stable

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Other Factors affecting Rating

­None

Key Financials

Particulars	Unit	FY 26 (Provisional)	FY 25 (Actual)
Operating Income	Rs. Cr.	479.10	494.62
PAT	Rs. Cr.	16.10	16.03
PAT Margin	(%)	3.36	3.24
Total Debt/Tangible Net Worth	Times	0.27	0.24
PBDIT/Interest	Times	8.03	5.58

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

­Not Applicable

Any Other Information

­None

Applicable Criteria

• Application Of Financial Ratios And Adjustments: https://www.acuite.in/view-rating-criteria-53.htm • Consolidation Of Companies: https://www.acuite.in/view-rating-criteria-60.htm • Default Recognition: https://www.acuite.in/view-rating-criteria-52.htm • Manufacturing Entities: https://www.acuite.in/view-rating-criteria-59.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 04 Jul 2025 Letter of Credit Short Term 25.00 ACUITE A2 (Upgraded from ACUITE A4+) Letter of Credit Short Term 10.00 ACUITE A2 (Upgraded from ACUITE A4+) Letter of Credit Short Term 25.00 ACUITE A2 (Upgraded from ACUITE A4+) Cash Credit Long Term 15.00 ACUITE BBB+ | Stable (Upgraded from ACUITE BB+) Cash Credit Long Term 5.00 ACUITE BBB+ | Stable (Upgraded from ACUITE BB+) Proposed Long Term Bank Facility Long Term 5.00 ACUITE BBB+ | Stable (Upgraded from ACUITE BB+) Cash Credit Long Term 10.00 ACUITE BBB+ | Stable (Upgraded from ACUITE BB+) 06 Jun 2025 Letter of Credit Short Term 10.00 ACUITE A4+ (Downgraded & Issuer not co-operating* from ACUITE A2) Letter of Credit Short Term 50.00 ACUITE A4+ (Downgraded & Issuer not co-operating* from ACUITE A2) Cash Credit Long Term 10.00 ACUITE BB+ (Downgraded & Issuer not co-operating* from ACUITE BBB+ | Stable) Cash Credit Long Term 20.00 ACUITE BB+ (Downgraded & Issuer not co-operating* from ACUITE BBB+ | Stable) Cash Credit Long Term 5.00 ACUITE BB+ (Downgraded & Issuer not co-operating* from ACUITE BBB+ | Stable) 14 Mar 2024 Letter of Credit Short Term 10.00 ACUITE A2 (Downgraded from ACUITE A2+) Letter of Credit Short Term 50.00 ACUITE A2 (Downgraded from ACUITE A2+) Cash Credit Long Term 5.00 ACUITE BBB+ | Stable (Downgraded from ACUITE A- | Stable) Cash Credit Long Term 10.00 ACUITE BBB+ | Stable (Downgraded from ACUITE A- | Stable) Cash Credit Long Term 20.00 ACUITE BBB+ | Stable (Downgraded from ACUITE A- | Stable)

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*Annexure 2 - List of Entities (applicable for Consolidation or Parent / Group / Govt. Support)

­ Sr. No. Company Name 1 Deccan Ferro Alloys Private Limited (DFAPL) 2 Vijaynagar Ispat and Alloys Private Limited (VIAPL) 3 Chhattisgarh Steel and Power Limited (CSPL)

Contacts

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

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