Vishnu Prakash R Punglia Ltd has disclosed a sharp credit rating downgrade by Infomerics Valuation and Rating Ltd following delays in servicing principal debt on unsecured short-term working capital borrowings. The filing also reflects significant financial deterioration in FY26, including operating losses, negative EBITDA and PAT, higher leverage and stretched working capital despite an order book of about Rs 4,391 crore.
Vishnu Prakash Faces Rating Downgrade Amid Debt Servicing Stress
Credit rating downgraded to IVR C+/Stable from IVR BB+/Stable.
FY26 PAT declined to a loss of Rs 150.11 crore.
Reader Takeaway: Strong order book offers revenue visibility, but liquidity stress and execution remain key concerns.
What just happened
Vishnu Prakash R Punglia Ltd disclosed that Infomerics Valuation and Rating Ltd has downgraded the company's credit ratings on bank facilities aggregating Rs 960 crore.
The long-term rating has been revised to IVR C+/Stable from IVR BB+/Stable, while the short-term rating has been lowered to IVR A4 from IVR A4+.
According to the rating rationale, the downgrade follows delays in servicing principal debt obligations relating to unsecured short-term working capital borrowings.
The company also disclosed that CARE Ratings has continued to classify it under the 'Issuer Not Cooperating' category as of September 11, 2026, citing inadequate information for review.
Why this matters
The filing highlights significant deterioration in the company's financial profile during FY26.
Standalone operating income declined to Rs 851.20 crore from Rs 1,237.42 crore in FY25.
EBITDA turned negative at Rs 82.08 crore, compared with a positive Rs 155.46 crore in the previous year.
The company reported a net loss of Rs 150.11 crore against a profit of Rs 58.60 crore in FY25.
Tangible net worth reduced to Rs 583.62 crore from Rs 773.33 crore, while overall gearing increased to 1.12 times from 0.91 times. Interest coverage also turned negative at -1.11 times.
Liquidity and execution challenges
The rating rationale cited stretched liquidity, continued operating losses and high utilisation of fund-based working capital limits.
Working capital indicators also weakened.
The operating cycle increased to about 237 days in FY26 from 188 days in FY25. Inventory holding rose to 309 days, while receivable collection extended to 150 days due to project execution delays, certification issues and slower government payments.
Positive factors
Despite the financial pressure, the company continues to report an unexecuted order book of approximately Rs 4,391 crore, providing revenue visibility over the next two to three years if execution improves.
What to track next
Investors should monitor debt servicing performance, working capital improvement, execution of the existing order book, receivable collections and future rating actions, as these will influence the company's financial recovery.