Press Release September 19, 2025 MAHAVEER ELECTRO MECH PRIVATE LIMITED Rating Assigned

Product	Quantum (Rs. Cr)	Long Term Rating	Short Term Rating
Bank Loan Ratings	5.00	ACUITE BBB- | Stable | Assigned	-
Bank Loan Ratings	170.00	-	ACUITE A3 | Assigned
Total Outstanding	175.00	-	-
Total Withdrawn	0.00	-	-

Rating Rationale

­Acuité has assigned the long-term rating of ‘ACUITE BBB-’ (read as ACUITE triple B minus) and short term rating of 'ACUITE A3' (read as ACUITE A three) on the Rs.175.00 Cr. bank facilities of Mahaveer Electro Mech Private Limited (MEMPL). The outlook is 'Stable'. Rationale for rating assigned The rating assigned factors in the established presence of the company in the electrical engineering procurement & construction (EPC) industry. While the FY25 revenues of the company moderated due to execution of ending milestones of various projects and minimal growth in orderbook over the past years, however, the current outstanding order book of ~Rs. 658.52 crore as on August 31, 2025, provides a sound revenue visibility at stable operating margins over the medium term. Further, rating factors healthy financial risk profile of the company with low gearing and comfortable debt protection metrics. However, the rating continues to remain constrained on account of intensive working capital operations driven by high debtors and other current assets, which majorly consists of retention money. Further, the rating is constrained by the tender based nature of operations, competitive industry and geographical concentration risk as all the current projects are majorly in the state of Karnataka.

About the Company

MEMPL is an electrical EPC player involved in planning, designing and executing turnkey electrical and infrastructure projects for various govt, semi govt and private bodies across Karnataka and other states. It was established in 1996 as a proprietorship firm and later in 2006, it transitioned into a private limited company. The company holds a super grade electrical license, KPWD Class I license and commissions H. V & E.H.V. transmission lines ranging from 66 KV to 400 KV and mechanical & civil works. The current directors of the company are Mr. Sharath Kumar K H, Mr. K H Rajendra Prasad, Mrs. Jwalini Gargatte.and Mrs. Prapoorna Jain.

Unsupported Rating

­Not Applicable

Analytical Approach

­­Acuité has considered a standalone approach while assessing the business and financial risk profile of MEMPL

Key Rating Drivers

Strengths

Established track record of operations MEMPL has an established track record of over three decades in the industry. The company is a super grade licensed electrical contractor, issued by the state department. The company has worked with various key Karnataka electrical departments such as Karnataka Power Transmission Corporation Limited (KPTCL), Karnataka Industrial Area Development Board (KIADB) and Karnataka State Small Industries Development Corporation (KSSIDC). Further, the promoter Mr. Sharath Kumar K H has an experience spanning over three decades as an EPC contractor which has helped MEMPL in increasing its scale of operations over the years.  Healthy orderbook position expected to improve the operating performance over the medium term While the revenues of the company stood lower at Rs.215.91 crore in FY25 (Prov.) as against Rs.240.70 crore in FY24, due to slow order execution and minimal growth in orderbook over the past years, however, the current outstanding orderbook of Rs 658.52 Cr. as on August 31st, 2025, provides a sound and improving revenue visibility over the medium term. Additionally, the company also has several large orders in pipeline, awaiting final confirmation. Once awarded, these will significantly boost the order book. Further, the company reported an improvement in the operating margins to 7.37 percent in FY25 (Prov.) as against 6.76 percent in FY24 due to cyclicality in the revenue recognition and expense bookings for EPC companies, however, on an overall basis the margins remain at a steady range of 6-8 percent. Therefore, the continued growth in order bookings and timely execution of contracts at steady margins shall be a key rating sensitivity. Healthy financial risk profile The net worth of the company improved to Rs.91.27 crore as on March 31, 2025 (Prov.) as against Rs.64.71 crore as on March 31, 2024, mainly on account of accretion of profits to reserves and increase in unsecured loans (subordinated to bank debt as per lender stipulation) to Rs.35.52 crore as on March 31, 2025 (Prov.) from Rs.18.66 crore as on March 31, 2024. The company’s debt profile consists majorly of short-term borrowings, keeping the gearing ratio below unity at 0.49 times as of March 31, 2025 (Prov.) (0.17 times as of March 31, 2024) and a healthy TOL/TNW at 1.88 times as on March 31, 2025 (Prov.) (2.62 times as on March 31, 2024). The interest coverage and debt/ EBITDA also stood comfortable at 5.26 and 2.78 times respectively as on March 31, 2025 (Prov.). Acuite expects the financial risk profile of the company to remain healthy in the absence of any debt funded capex and improving cash accruals.

Weaknesses

Intensive working capital operations The company's working capital operations remain intensive, as indicated by gross current asset (GCA) days of 400 days as of March 31, 2025(Prov.) (263 days as of March 31, 2024). This increase in GCA is primarily because of high debtors days which stood at 222 days in FY2025 (Prov.) and high other current assets consisting of retention money. The higher debtors level as on year-end, was a result of significant sales booked by the company in the month of March (~40% of total sales), which was later realized in current year i.e. FY26. Further, the company enhanced its working capital limits (Rs.3.00 crore fund based and Rs.50.00 crore non fund based) in the current year, which shall aid its order execution and scale in medium term. The average non-fund-based limit utilization stood at 72.29 percent for the last 7 months ended Aug 31, 2025. Acuite believes that working capital operations of the company may continue to remain intensive considering the nature of business. Tender based nature of operations along with geographical concentration risk MEMPL is engaged in bidding of various government tenders, wherein the company faces intense competition from several large and mid-sized players in the sector. The risk becomes more pronounced as tendering is based on a minimum amount of bidding for contracts. The company acquires tenders at competitive prices, which may affect its profitability. Further, there are uncertainties attached to the allotment of tenders. However, the risk is mitigated to some extent, given the group’s strong background in the industry, which has enabled the company to procure tenders on a regular basis. Furthermore, the company is exposed to geographical concentration risk, with the bulk of its operations located in Karnataka and, to a lesser extent, in Tamil Nadu and Haryana.

Rating Sensitivities

Strong and diversified order book growth & timely completion of existing orders leading to improvement in revenue and stable margins Maintenance of the financial risk profile and unsecured loan requirements Any further stretch in the working capital levels affecting the liquidity profile

Liquidity Position

Adequate

The liquidity of the company is marked adequate backed by healthy net cash accruals of Rs.9.96 crore in FY25 (Prov.) as against repayment obligations of Rs.0.53 crore. Going forward, net cash accruals are expected in the range of Rs.10-16 crore. The current ratio stood moderate at 1.56 times as on March 31, 2025 (Prov.). Further, the average non fund based bank limit utilization for the last 7 months ended August 31, 2025 stood moderate at ~72.29 percent limits. The company also reported a free cash and bank balance of Rs.0.25 crore. Acuite believes that the liquidity position of the company will continue to remain adequate on account improving cash accruals against the no major debt repayment obligations for the company.

Outlook - Stable

­

Other Factors affecting Rating

­None

Key Financials

Particulars	Unit	FY 25 (Provisional)	FY 24 (Actual)
Operating Income	Rs. Cr.	215.91	240.70
PAT	Rs. Cr.	9.69	10.50
PAT Margin	(%)	4.49	4.36
Total Debt/Tangible Net Worth	Times	0.49	0.17
PBDIT/Interest	Times	5.26	5.51

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

­None

Any other information

­None

Applicable Criteria

• Default Recognition :- https://www.acuite.in/view-rating-criteria-52.htm • Infrastructure Sector: https://www.acuite.in/view-rating-criteria-51.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 :

­Not Applicable

Annexure - Details of instruments rated

Lender’s Name ISIN Facilities Date Of Issuance Coupon Rate Maturity Date Quantum (Rs. Cr.) Complexity Level Rating HDFC Bank Ltd Not avl. / Not appl. Bank Guarantee (BLR) Not avl. / Not appl. Not avl. / Not appl. Not avl. / Not appl. 105.00 Simple ACUITE A3 | Assigned ICICI Bank Ltd Not avl. / Not appl. Bank Guarantee (BLR) Not avl. / Not appl. Not avl. / Not appl. Not avl. / Not appl. 35.00 Simple ACUITE A3 | Assigned ICICI Bank Ltd Not avl. / Not appl. Cash Credit Not avl. / Not appl. Not avl. / Not appl. Not avl. / Not appl. 3.00 Simple ACUITE BBB- | Stable | Assigned HDFC Bank Ltd Not avl. / Not appl. Letter of Credit Not avl. / Not appl. Not avl. / Not appl. Not avl. / Not appl. 8.00 Simple ACUITE A3 | Assigned Not Applicable Not avl. / Not appl. Proposed Short Term Bank Facility Not avl. / Not appl. Not avl. / Not appl. Not avl. / Not appl. 22.00 Simple ACUITE A3 | Assigned HDFC Bank Ltd Not avl. / Not appl. Secured Overdraft Not avl. / Not appl. Not avl. / Not appl. Not avl. / Not appl. 2.00 Simple ACUITE BBB- | Stable | Assigned

Contacts

Mohit Jain Chief Analytical Officer - Rating Operations Parth Patel 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.