­Acuite has consolidated the business and financial risk profiles of Dwaraka Iron Industries Private Limited, Dwaraka Ispat Private Limited and Srinivasa Steel Traders together referred to as the 'Dwaraka Group'. The consolidation is in the view of common management, strong operational linkages between the entities, and a similar line of business.

­Experienced Management and Established track record of operations
The group is entirely managed by Mr. Miryala Ravindar Reddy as managing director and chief promoter of the 'Dwaraka Group', having experience of more than three decades in the same line of industry. The group is engaged in the manufacturing and trading of TMT bars under the brand name ‘Dwaraka' as well as cement. Moreover, the established track record of operations has enabled the group to establish healthy relationships with its suppliers and clientele. Acuite believes that the group will continue to derive benefit from the established track record of operations and management’s strong understanding of market dynamics.

Healthy scale of operations
The operating income of the group stood at Rs. 764.25 Cr. in FY2026 (Prov.) as against Rs. 668.18 Cr. in FY2025, primarily driven by higher TMT sales volumes despite moderation in average realization prices. The group also continues to benefit from its established sales and distribution network, which facilitates broader market reach and supports incremental order inflows. On the profitability level, the EBITDA margin of the group stood at 3.04% in FY2026 (Prov.) as against 2.78% in FY2025. Likewise, the PAT margin stood at 0.90% in FY2026 (Prov.) as against 0.74% in FY2025.

Going forward, the group has debt-funded capital expenditure plans for setting up an induction melting furnace division in the existing manufacturing facility under Dwaraka Iron Industries Private Limited, with an estimated cost of Rs. 50.00 Cr. The funding is expected through a mix of promoter contribution and external borrowings. The capex is expected to be commercialized by Q4 FY2028. Acuite expects the company to sustain its business risk profile over the medium, supported by its established market presence and distribution network coupled with expected improvement in the scale of operations following capacity enhancement.

Moderate Financial Risk Profile
The financial risk profile of the group is moderate, marked by modest net worth, moderate gearing, and debt protection metrics. The tangible net worth of the group stood at Rs.62.93 Cr. as on 31st March 2026 (Prov.) as against Rs.54.76 Cr. as on 31st March 2025 on account of accretion of profits into reserves and infusion of funds by promoters in the form of equity share capital. The gearing ratio stood at 2.24 times as on 31st March 2026 (Prov.) as against 2.23 times as on 31st March 2025, majorly owing to the short-term debt (working capital limits) and unsecured loans infused by the promoters. Further, the coverage indicators are reflected by the interest coverage ratio and debt service coverage ratio, which stood at 1.69 times and 1.47 times, respectively, as on 31st March 2026 (Prov.). The Total Outside Liabilities/Tangible Net Worth (TOL/TNW) stood at 3.86 times as on 31st March 2026 (Prov.) as against 3.93 times as on 31st March 2025. Acuite expects the financial risk profile of the group to remain on similar levels, backed by steady accruals, despite proposed debt-funded capex plans in the near to medium term.

Moderately Intensive working capital operations
The working capital operations of the group remained moderately intensive, marked by GCA days of 126 days as on 31st March 2026 (Prov.) as against 125 days as on 31st March 2025. The inventory days stood at 38 days as on 31st March 2026 (Prov.) and 31st March 2025 as the group maintains adequate inventory as and when required for order execution. Further, the debtor days stood at 86 days as on 31st March 2026 (Prov.) as against 87 days as on 31st March 2025 and the creditor days stood at 43 days as on 31st March 2026 (Prov.) as against 47 days as on 31st March 2025. Acuite expects the working capital operations of the group to remain on similar levels in the near to medium term owing to the nature of operations.

Susceptibility to volatility in raw material prices and cyclicality inherent in the steel industry
The group's performance remains vulnerable to the cyclical and competitive steel processing industry given the close linkage between the demand for steel products and the domestic and global economies coupled with the presence of several organized and unorganized players. The steel industry is sensitive to the shifting business cycles, including changes in the general economy and seasonal changes in the demand and supply conditions in the market. The prices and supply of the key raw materials directly impact the realization of finished goods. Acuite notes that any sharp raw material cost fluctuations impacting the operating margins and cash accruals of the group will remain a key monitorable.

• ­Growth in operating income by more than 20%, supported by healthy order accretion.
• Significant improvement in the operating profitability position.
• Improvement in capital structure and debt protection metrics.

• ­Decline in revenue y-o-y and/or operating profitability margins below 1.8%.
• Stretch in the working capital operations.
• Deterioration in the financial risk profile owing to larger than expected debt-funded capex.