Vijay Transmission Private Limited

Brickwork Ratings assigns the ratings for the Bank Loan Facilities of Rs. 121.16 Crs. of Vijay Transmission Private Limited

Particulars

Facilities**	Amount(Rs.Crs.)	Tenure	Rating#
Fund Based	91.64	Long Term	BWR BBB + /Stable Assignment
Non Fund Based	29.52	Short Term	BWR A2 Assignment
Grand Total	121.16	(Rupees One Hundred Twenty One Crores and Sixteen lakhs Only)

#Please refer to BWR website www.brickworkratings.com for definition of the ratings
**Details of Bank Loan facilities,consolidation or instruments are provided in Annexure
Note: Financial indicators calculations are as per BWR criteria and methodologies RATING ACTION / OUTLOOK

Brickwork Ratings assigns the ratings of BWR BBB+/Stable for long-term facilities and BWR A2 for short-term facilities, totalling to  Rs. 121.16  Crs. of Vijay Transmission Private Limited.

The ratings are supported by the experience of the promoters with an established track record in the industry, the company's integrated facilities, and its strategic location. Furthermore, the ratings reflect a diversified product profile, a moderate order book position, and improving operating performance and financial risk profiles. Conversely, the ratings are constrained by the working capital-intensive nature of operations, the susceptibility of profitability to raw material price volatility, and intense competition within the industry.

BWR believes Vijay Transmission Private Limited will maintain its business risk profile over the medium term. The 'Stable' outlook reflects BWR's expectation that the company will sustain its operational and financial performance while maintaining its long-term customer relationships in the medium term.

KEY RATING DRIVERS

Credit Strengths:

• Improving operational and financial risk profile :

  The company achieved a CAGR of 34.06%, with revenue increasing from Rs. 237.28 crore in FY23 to Rs. 426.46 crore in FY25. This growth was driven by strong demand, new client acquisitions, and improved capacity utilisation. Alongside the increase in Total Operating Income (TOI), both operating profit and PAT have consistently grown in absolute terms. While operating margins remained stable between 6% and 6.7%, PAT margins have shown improvement over the last three years. Additionally, net cash accruals rose from Rs. 4.98 crore in FY23 to Rs. 11.57 crore in FY25.
  The financial risk profile is characterised as moderate, supported by a growing Tangible Net Worth (TNW) base, moderate gearing, and stable coverage indicators. Although the capital structure is expected to be leveraged in FY26 due to debt-funded capital expenditure, it is anticipated to remain within satisfactory limits.

  For 9MFY26, the company reported Rs. 340.98 cr with an operating margin of 8.06%

• Integrated Facilities and Strategic Location :

  The company handles the entire value chain in-house, including design, testing, fabrication, and galvanising. Further, over the past two years, the company has undertaken capital expenditure to expand fabrication and galvanising capacities, allowing the company to internalise higher production volumes going forward. 
  The company's strategic location in Raipur ensures efficient access to raw materials and reduces logistics costs for projects in Central and Western India. Furthermore, VTPL is an approved vendor for various central and state utilities, which serves as a barrier to entry for competitors.

• Diversified product profile coupled with a moderate orderbook position :

  VTPL maintains a diversified product profile, manufacturing various fabricated and galvanised products, including power transmission towers, substation structures, telecom towers, RSJ Poles, and earthing strips. As of January 1, 2026, the company reports an outstanding order book of Rs. 291.78 crore. These orders are scheduled for execution within the next four to five months, providing moderate near-term revenue visibility.

• Long track record of the promoter and experienced management :

  VTPL is promoted by Mr. Sanjay Paliwal, who serves as the Managing Director. Based in Raipur, Chhattisgarh, Mr. Paliwal leads the company’s affairs with approximately three decades of industry experience. He oversees overall operations, supported by a board of directors and a team of qualified personnel. The promoter's extensive experience has been instrumental in establishing and maintaining long-term relationships with both customers and suppliers.

Credit Risks:

• Working capital-intensive nature of the operation :

  Operations remain working capital-intensive, with the cycle recorded at 84 days as of March 31, 2025, compared to 83 days as of March 31, 2024. This is primarily driven by high inventory requirements, as VTPL maintains 4-5 months of stock to meet customised customer needs. Additionally, intense market competition necessitates credit periods of 30-40 days. Average utilisation of fund-based limits reached approximately 90% for the twelve months ended February 2026, indicating a limited liquidity cushion. This intensive working capital requirement is further attributed to concentrated sales in the second half of the financial year and ongoing dealings with government departments and EPC contractors.
  However, these risks are partially mitigated by the company’s long-standing relationships with reputable customers and suppliers, as well as a lower counterparty risk. Furthermore, liquidity headroom has been improved following the sanction of enhanced working capital limits by Axis Bank.

• Susceptibility of profitability to raw material price volatility and Intense competition in the industry :

  The company’s profitability margins are susceptible to fluctuations in raw material costs. While the industry is highly fragmented and significant competition limits bargaining power, this risk is partially mitigated by longstanding client relationships and the inclusion of price escalation clauses. These arrangements allow the company to be compensated for price increases, providing a degree of stability against market volatility.
  The transmission tower manufacturing industry currently features a high number of participants due to low entry barriers and the widespread availability of raw materials. This intense competition is expected to persist, resulting in continued pricing pressure and a significant impact on overall profitability within the sector.
   

ANALYTICAL APPROACH - Standalone

For arriving at its ratings, BWR has considered the standalone approach for the Company. BWR has applied its rating methodology as detailed in the Rating Criteria detailed below (hyperlinks provided at the end of this rationale).

RATING SENSITIVITIES

Positive sensitivity

• Sustainable growth in the scale of operations with improvement in the operating profit margin beyond 8% on a sustained basis may lead to positive rating action
• Improvement in the capital structure, marked by improvement in the overall gearing ratio to below 1.00x, may lead to positive rating action
• Effective management of working capital limits while maintaining TOL/TNW under 2 times on a sustained basis may lead to positive rating action.

Negative sensitivity 

• Any decline in scale of operations and/or profitability leading to deterioration in liquidity and debt protection metrics may lead to negative rating action
• Any unplanned debt-funded capex leading to a moderation in the capital structure, marked by an overall gearing ratio above 1.6x, may lead to negative rating action
• Any substantial stretch in the operating cycle impacting the liquidity may lead to negative rating action

LIQUIDITY INDICATORS - Adequate

Liquidity profile of the company is marked adequate, supported by cash accruals of Rs. 11.57 cr for FY25 and projected accruals of Rs. 16 cr for FY26(P) and cash and bank balance of Rs. 5.92 cr. as on March 31, 2025, as against term debt repayment of Rs. 0.99 cr for FY26 and Rs. 3.96 cr for FY27. Liquidity is further supported by a moderate current ratio of 1.20 times as of March 31, 2025, and an ISCR of 2.08 times. The average utilization of working capital limits for the last 12 months ending February 2026 was between 90% and 95%. Furthermore, the company has sanctioned working capital facilities of Rs. 15 cr from Axis Bank that remain unutilized, providing additional liquidity headroom. The company recently completed debt-funded capital expenditures to expand its fabrication and galvanizing capacities, with trial runs started in January 2026. While the increase in in-house capacity is expected to absorb volumes, any significant cost escalation that impacts profitability and/or liquidity will be a key monitorable going forward.

ABOUT THE ENTITY

Incorporated in December 2006, VTPL specializes in the fabrication and galvanization of substation structures, transmission towers, and other structural items. The company’s three manufacturing facilities are located in Raipur, Chhattisgarh, with a total annual installed capacity of 90,000 MTPA for fabrication and 60,000 MTPA for galvanization. VTPL is promoted by Mr. Sanjay Paliwal, who serves as the Managing Director. With approximately three decades of industry experience, Mr. Paliwal oversees day-to-day operations supported by a board of directors and a team of experienced professionals.

ESG Profile

The company demonstrates an evolving ESG profile based on its environmental, social, and governance practices.

Environmental: Environmental risks are driven by high water usage, waste generation, and reliance on energy-intensive processes, making disclosures on water consumption, waste-management practices, renewable energy share, and emissions levels particularly important. 

Social: Social factors hinge on adherence to labour laws, accident prevention frameworks, and human-capital development, with metrics such as workforce mix, safety performance, and training initiatives offering insights into operational resilience.

Governance: Governance assessment focuses on board independence, committee effectiveness, and robustness of compliance systems, supported by readily available disclosures on board structure, audit mechanisms, and risk-management practices.

KEY FINANCIAL INDICATORS (Standalone)

Key Parameters	Units	FY 22 - 23 (Audited - Annual)	FY 23 - 24 (Audited - Annual)	FY 24 - 25 (Audited - Annual)
Operating Revenue	Rs.Crs.	237.28	339.65	426.46
EBITDA	Rs.Crs.	15.84	20.89	25.63
PAT	Rs.Crs.	3.39	7.04	9.88
Tangible Net Worth	Rs.Crs.	41.20	48.25	58.11
Total Debt / Tangible Net Worth	Times	1.07	1.28	1.06
Current Ratio	Times	1.30	1.26	1.20

KEY COVENANTS OF THE FACILITY RATED

Standard covenants as per the sanction letter.

STATUS OF NON-COOPERATION WITH PREVIOUS CRA

Not Applicable

RATING HISTORY FOR LAST THREE YEARS (including withdrawal and suspended)

Facilities	Current Rating  (2026)			2025		2024		2023
Type	Tenure	Amount (Rs.Crs.)	Rating	Date	Rating	Date	Rating	Date	Rating
Fund Based	LT	91.64	BWR BBB+/Stable (Assignment)	NA	NA	NA	NA	NA	NA
Non Fund Based	ST	29.52	BWR A2 (Assignment)	NA	NA	NA	NA	NA	NA
Grand Total		121.16	(Rupees One Hundred Twenty One Crores and Sixteen lakhs Only)

Hyperlink/Reference to applicable Criteria

• General Criteria
• Approach to Financial Ratios
• Manufacturing Companies
• Short Term Debt

Analytical Contacts
Kanwalpreet Singh Ratings Analyst kanwalpreet.s@brickworkratings.com	Niraj Kumar Rathi Senior Director Ratings niraj.r@brickworkratings.com
1-860-425-2742 | media@brickworkratings.com	Customer Support | CustSupport@brickwrokratings.com

SL.No.	Name of the Bank/Lender	Type Of Facilities	Long Term(Rs.Crs.)	Short Term(Rs.Crs.)	Total(Rs.Crs.)	Complexity of the Instrument
1	Axis Bank Ltd.	Cash Credit - Sanctioned	10.00	_	10.00	Simple##
2	Axis Bank Ltd.	BG/ILC - Sanctioned	_	5.00	5.00	Simple##
3	HDFC Bank	BG/ILC - Sanctioned	_	14.00	14.00	Simple##
4	HDFC Bank	Cash Credit - Sanctioned	21.00	_	21.00	Simple##
5	Kotak Mahindra Bank	Term Loan - Out-standing	11.64	_	11.64	Simple##
6	Kotak Mahindra Bank	Cash Credit - Sanctioned	16.00	_	16.00	Simple##
7	Punjab National Bank	Cash Credit - Sanctioned	33.00	_	33.00	Simple##
8	Punjab National Bank	BG/ILC - Sanctioned	_	10.52	10.52	Simple##
Total			91.64	29.52	121.16
TOTAL (Rupees One Hundred Twenty One Crores and Sixteen lakhs Only)

## BWR complexity levels are meant for educating investors. The BWR complexity levels are available at www.brickworkratings.com / download / ComplexityLevels.pdf. Investors queries can be sent to info@brickworkratings.com.