Press Release July 02, 2026 MEIL RENIGUNTA ROADWAYS PRIVATE LIMITED Rating Assigned

Product	Quantum (Rs. Cr) (SEBI)	Quantum (Rs. Cr) (Other FSR)	Long Term Rating	Short Term Rating	Regulated By
Bank Loan Ratings	0.00	1125.00	ACUITE AAA | Stable | Assigned	-	RBI
Total Outstanding	0.00	1125.00	-	-	-
Total Withdrawn	0.00	0.00	-	-	-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

A­cuite has assigned its long-term rating of ‘ACUITE AAA' (read as ACUITE triple A) on Rs 1125.00 Cr. bank facilities of MEIL Renigunta Roadways Private Limited(MRRPL). The outlook is 'Stable'. Rationale for rating The assigned rating for MEIL Renigunta Roadways Private Limited (MRRPL) derives comfort from the comfortable debt coverage metrics and the operational nature of the project with a track record of receipt of the first two semi-annual annuities. Acuite takes notes of the delays encountered in receipt of both annuities owing to administrative delays and ongoing discussions on descoping of certain part of the project due to land acquisition issues. However, repayment obligations have been met in timely manner, aided by support from the company’s sponsor - Megha Engineering and Infrastructures Ltd (MEIL). Also, with descoping being approved , therefore, going forward annuities are expected to be received in a timely manner. The rating takes into account that MRRPL has received provisional completion on April 07,2025 wherein 100 percent of project work is completed and accessible for traffic. Furthermore, with receipt of descoping discussions the final COD is expected to be received in the near term. Also, availability of a buffer of 23 days between the scheduled annuity receipt date and scheduled principal repayment date, along with the creation of to one semi-annual instalment plus interest of two quarters debt service reserve (DSRA) provides additional comfort for repayment of debt obligations. MRRPL’s projected debt coverage indicators are likely to be comfortable with an average debt servicing coverage ratio (DSCR) of over 1.23 times till the debt tenure. The rating draws strength from the operational nature of the project, with 60% of the final completion cost to be paid out as semi-annual annuities (along with the interest on the residual annuities payable, at the Bank Rate + 3%). Further, MRRPL will receive inflation-adjusted operations and maintenance (O&M) cost over the 15-year operations period from the project owner, National Highways Authority of India [NHAI], which is a strong counterparty. These strengths are however partly offset by susceptibility to risks related to delay in receipt of annuity and changes in operational cost & interest rate.

About the Company

Established in 2021, Telangana based, MEIL Renigunta Roadways Private Limited was, fully owned special purpose vehicle (SPV) of Megha Engineering and Infrastructures Limited. The SPV has undertaken the development maintenance and management of Six-Laning of NH-71 from Renigunta (Start at junction of NH71, NH-18A, NH-205 MDR of Renigunta) (Design Km 0.000/Existing Km 124.600 of NH-71) to Naidupeta (End on NH-16) (Design Km 57.046/Existing Km 183+400 of NH 71) (Design Length = 57.046 Km) on Hybrid Annuity Mode in the state of Andhra Pradesh under concession agreement awarded by National Highway Authority of India (NHAI). The appointed date was January 31,2022 and operation period is 17 years including 2 years of construction period. Mr. Venkata Madhusudana Rao Chadalavada, Ms. Seshagiri Rao Malladi, and Mr. Kallam Surya Kumari are the directors of the company. The total project cost amounted to Rs 1970.61 Cr which is slightly higher than original bid project cost of Rs 1899.00 Cr (Revised bid project cost of Rs 1871.72 Cr post descoping) and escalated bid project cost is of Rs 2357.43 Cr.

Unsupported Rating

­Not applicable

Analytical Approach

­­Acuité has considered the standalone business and financial risk profile of MRRPL to arrive at this rating.

Key Rating Drivers

Strengths

­Reputed sponsor The project sponsor is Megha Engineering and Infrastructures Limited (Acuite AA/ Stable) which is renowned EPC player having operations diversified across various sectors such as irrigation, drinking water, roads, power generation & transmission, roads, manufacturing, hydrocarbons, buildings, electric vehicles, city gas distribution, renewables, railways and other infrastructure sectors. The company has presence in nearly 14 countries across the globe. It has an outstanding orderbook of Rs 2,27,000 Cr. as on June 19,2026. Also, sponsor shall support the project for any cashflows mismatches, if required. Strong counter party involving low revenue risk The project has been issued and awarded by the National Highways Authority of India (NHAI), a central government agency that holds strategic importance for the Government of India. It is developed under an annuity-based revenue model, wherein MRRPL bears no traffic risk and recovers the entire capital cost through biannual annuity payments over a 15-year concession period. Under this model, MRRPL has received 40 percent of the project cost as construction grants, while the remaining 60 percent will be paid in 30 semi-annual annuity instalments (adjusted for the price index multiple) amounting to Rs 1406.41 Cr, which has commenced from October 2025. In addition to annuity payments, NHAI will reimburse interest on the reducing balance of the completion cost (net of grants) at a rate equivalent to the bank rate plus 3.00 percent spread. NHAI will also reimburse the operations and maintenance (O&M) cost of Rs. 97.22 Cr. adjusted for the price index. The annuity model includes price index adjustments to mitigate inflation-related risks and partially offset price fluctuation risks. MRRPL will be responsible for operations and maintenance during the concession phase, with financial support from NHAI. The company has already received five milestone payments, two annuity receipts but with the delays of 44 days and 28 days respectively from schedule date. Explicit waterfall mechanism through Escrow account coupled with creation of DSRA The SPV refinanced its existing debt of Rs 600.00 Cr. with an additional top up leading to a total sanction of Rs 1,055 Cr (Rs 885.78 Cr drawn till date). The additional debt shall be used to reimburse the parent company for repayments made towards unsecured loans. As per the sanction term, the SPV is required to create debt service reserve account (DSRA) equivalent to one semi-annual instalment for the loan period plus interest for minimum two quarters wherein 50% upfront DSRA from 1st disbursement (taken in December 2025) and balance amount in two instalments from subsequent two annuities and interest on annuities to be received. 67.25 percent of DSRA amounting to Rs 50.30 Cr. has been created as on May 31, 2026 (based on current utilisation). Further, balance DSRA shall be created on receipt of third annuity. In the event of delay in receiving any annuities, the instalment plus interest shall be recovered out of DSRA to ensure regular repayment as DSRA shall be replenished by collection in subsequent months. Any shortfall in the DSRA shall be made good from the amount lying in the escrow account after satisfying waterfall mechanism as per the concession agreement. MRRPL shall maintain escrow account for cashflow management. Its receipts from the NHAI through an escrow account with a well-defined cash flow. NHAI is to deposit all annuities, proceeds from termination amount/penalty received from authority, security enforcement or any insurance proceeds and so on into the escrow account. The O&M annuities and other income shall be deposited into the escrow account and withdrawals shall be permitted after embarking the amount required for servicing of debt and as per terms of agreement. Acuité believes that presence of such well-defined waterfall mechanism through escrow to ensure prioritizing of withdrawals and prompt debt repayments.

Weaknesses

S­usceptibility to risks related to delay in receipt of annuity or exposure to risk related to O&M and interest rate fluctuations As per the concession agreement, the company is entitled to receive a semi-annual annuity over the concession period. However, any delay in the timely receipt of these annuity payments could adversely affect its debt servicing capacity. In addition to fixed annuities, the project is also eligible to receive interest on outstanding annuity amounts, calculated at the prevailing bank rate plus an applicable spread. Therefore, the project’s cash flows and returns are exposed to the interest rate risk and are dependent on the spread between the RBI’s Bank Rate and the interest rate charged by lenders. Furthermore, the company is also exposed to risks associated with the maintenance of the project and failure to adhere to prescribed maintenance standards or delays in timely upkeep could lead to deductions in annuity payments, thereby significantly impacting the company’s cash flows.

Assessment of Adequacy of Credit Enhancement under various scenarios including stress scenarios (applicable for ratings factoring specified support considerations with or without the “CE” suffix)

­MRRPL maintains a Debt Service Reserve Account (DSRA) equivalent to one semi-annual instalment plus interest of minimum two quarters along with ESCROW mechanism. Stress case Scenario Acuité believes that, given the presence of DSRA and waterfall payment in ESCROW mechanism, MRRPL will be able to service its debt on time, even in a stress scenario.

Rating Sensitivities

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

­Not applicable

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

Susceptibility to risk related to delay or major deductions in receipt of annuity or any additional debt availed by the SPV thereby impacting its coverage indicators leading to average DSCR falling below 1.10 times

Liquidity Position

Adequate

MRRPL’s liquidity position is adequate, supported by timely receipt of milestone payments from NHAI during the project execution phase and commencement of annuities inflow from October 2025 onwards with receipt of two annuities amounting to ~Rs 184.00 Cr till May-2026 . Acuité expects that the liquidity of MRRPL is likely to remain adequate backed by consistent support from government in terms of annuity payments and the maintenance of a DSRA equivalent to one principal instalment and six months’ interest obligations. The project’s cash flows are expected to be sufficient to meet its debt servicing obligations  (~Rs 154 Cr in FY2027-2028) , with an average DSCR of around 1.23 times over the tenure of the rated instrument. The company had a cash and bank balance of Rs 0.21 Cr as on March 31, 2026 (Prov.)

Outlook-Stable

­

Other Factors affecting Rating

­None

Key Financials

Particulars	Unit	FY 26 (Provisional)	FY 25 (Actual)
Operating Income	Rs. Cr.	117.62	402.94
PAT	Rs. Cr.	(11.17)	7.23
PAT Margin	(%)	(9.50)	1.79
Total Debt/Tangible Net Worth	Times	4.02	2.97
PBDIT/Interest	Times	0.88	1.14

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

Contacts

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

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