Vishnu Prakash R Punglia Limited has informed the Exchange about Credit Rating- Revision
VPRPL · price
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CARE Ratings has downgraded Vishnu Prakash R Punglia Limited's (VPRPL) credit ratings and revised its outlook to Negative from Stable. The long-term bank facilities of Rs. 200 crore were downgraded from CARE BBB+; Stable to CARE BBB; Negative, while the long-term/short-term bank facilities of Rs. 760 crore were downgraded from CARE BBB+; Stable/CARE A3+ to CARE BBB; Negative/CARE A3. The downgrade is driven by continued delays in payment releases and work certifications from state government bodies, high working capital intensity, and weaker-than-expected FY25 performance, with revenue falling 16% to Rs. 1,237 crore and profit margins shrinking significantly. On the positive side, the company maintains a healthy orderbook of Rs. 5,363 crore (4.33x revenue visibility), low counterparty risk from government clients, and strong promoter experience in water supply projects.
This is a negative development for shareholders as the downgrade signals rising financial stress and liquidity concerns, which could increase borrowing costs and weigh on the stock price in the short term. However, the company still operates in the investment-grade category and benefits from government-backed projects, so a further downgrade depends on whether payment cycles improve in the coming months.