Kailash Enterprises

Brickwork Ratings assigns the long term ratings for the Bank Loan Facilities of Rs. 34.09 Crs. of Kailash Enterprises

Particulars

Facilities	Amount(Rs.Crs.)	Tenure	Rating	Regulator
Fund Based	34.09	Long Term	BWR BB /Stable Assignment	RBI
Grand Total	34.09	(Rupees Thirty Four Crores and Nine lakhs Only)

Note:
1. Please refer to BWR website www.brickworkratings.com for the definition of the ratings
2. Refer to Annexures I, II, and III for details of rated bank loan facilities, debt instruments, and the List of Entities Consolidated RATING ACTION / OUTLOOK

BWR has assigned the long-term rating BWR BB with a Stable Outlook for the bank loan facilities of Rs 34.09 Crs of Kailash Enterprises. 

Brickwork Ratings (BWR) has assigned the ratings of Kailash Enterprises (the firm), considering factors such as strong revenue visibility, considering the presence of medium-to-long-term PPAs for the entire operational capacity and growing demand for power, Government Support and Technological Advancements, and the presence of a structured payment mechanism. However, the rating is constrained by the Susceptibility of operating performance to climatic risks, Effective subsidy realisation and Efficient O&M management, and maintenance and operation costs. However, going forward, the company’s ability to improve its operational scale and profitability, as well as to strengthen its liquidity and overall credit profile, would be the key rating sensitivities. 

The outlook has been assigned as Stable as BWR believes that the business risk profile of the company will be maintained over the medium term. The Stable outlook indicates a low likelihood of a rating change over the medium term.

For assigning the rating, BWR has relied upon the last 3 years of audited financials till FY25 and Provisional FY26 and projected financials for FY27 and FY28, and publicly available information and clarification provided by management. 

KEY RATING DRIVERS

Credit Strengths:

• Strong revenue visibility considering the presence of medium-to-long term PPAs for the entire operational capacity and growing demand for power :

  The projects benefit from a fully tied-up demand structure through executed long-term 25-year PPAs with Jodhpur Vidyut Vitran Nigam Limited (JDVVNL) at discovered and adopted levelized tariffs. The RESCO framework, coupled with assured feeder-level procurement, eliminates merchant exposure and provides predictable, annuity-type cash flows with limited market risk. The regulatory backing under the Pradhan Mantri Kisan Urja Suraksha evam Utthaan Mahabhiyan (PM-KUSUM) scheme further strengthens revenue visibility and offtake security. Further, India's increasing energy demand, particularly in rural and semi-urban areas, presents a significant market opportunity for solar power generation. 

• Government Support and Technological Advancements :

  The Indian government offers various incentives, subsidies, and favorable policies for solar power projects, which can enhance project viability. Initiatives like the PM-KUSUM scheme and accelerated depreciation benefits make financing more accessible. Further advances in solar technology have led to improved efficiency and reduced costs of solar panels and inverters, enhancing project feasibility. The project can benefit from the latest solar technologies, increasing energy generation and lowering maintenance costs. 

• Presence of a structured payment mechanism :

  The bank facilities availed by KE are backed by a Debt Service Reserve Account (DSRA) in the form of a fixed deposit with SBI Bank. In addition, the bank facilities are supported by an escrow account through which all receipts from JDVVNL shall be routed. The order regarding the manner in which funds shall be utilized has been clearly laid down by the lender. Furthermore, there is a cash sweep clause that allows the lender to utilize the surplus amount in the escrow account towards the prepayment of the debt undertaken by the company. BWR derives comfort from the structure envisaged to ensure timely repayment of the bank facilities over the medium term.

Credit Risks:

• Susceptibility of operating performance to climatic risks :

  The performance of the solar plant is highly dependent on favorable climatic conditions, including solar radiation levels, which have a direct impact on the plant load factor (PLF). These risks include variations in solar irradiance, extreme weather conditions, and natural disasters. The entire capacity is already commissioned, and the project has an operational track record of more than 6 to 8 Months.

• Effective subsidy realisation and Efficient O&M management, Maintenance and Operation Costs :

  Timely receipt and application of capital subsidy under Pradhan Mantri Kisan Urja Suraksha evam Utthaan Mahabhiyan (PM-KUSUM) is important to reduce debt burden and strengthen financial metrics.  Structured O&M practices, remote monitoring systems, and rapid fault rectification will minimise downtime and maximise energy yield over the 25-year life.
   While solar power systems generally have low operational costs, ongoing maintenance, cleaning, and monitoring are necessary to ensure optimal performance.  Any unforeseen maintenance issues can disrupt energy generation and impact revenue

ANALYTICAL APPROACH - Standalone

Standalone - For arriving at its ratings, BWR has considered the standalone performance of Kailash Enterprises, BWR has applied its rating methodology as detailed in the Rating Criteria (hyperlinks provided at the end of this rationale).

RATING SENSITIVITIES

Positive Factors:

• The company's improvement in the scale of operations on a sustained basis while maintaining the DSCR above 1.30x. 
• Timely receipt of payments from RUVITL/JDVVNL on a sustained basis. 

Negative Factors:

• The rating may be downgraded if there is a deterioration in revenue on a sustained basis and DSCR below 1.00x, leading to a weakening in overall performance.

LIQUIDITY INDICATORS - Adequate

The firm's liquidity position is considered adequate, supported by net cash accruals of Rs 7.41 crore in FY2026(P) as against repayment obligations amounting to Rs 2.01 crore. Further, the company is expected to generate sufficient net cash accruals in the range of Rs 15.91 - Rs 13.90 crore as against its debt servicing obligation of Rs 12 crore for FY2027-2030. The current ratio reported by the company is 3.69 times in FY2026(P). Cash and bank balances stood at Rs 0.56 Cr. as on March 31, 2026(P). The company gets support from the promoters in the form of unsecured loans, and all these factors reflect an adequate liquidity position of the company. 

ABOUT THE ENTITY

Kailash Enterprises (KE) since 1995. The firm was registered as a Partnership firm. Mr. Om Prakash Mehta, Mr. Kailash Mehta, Mr. Nilesh Mehta, and Mr. Rajesh Mehta are the partners in the firm. KE is an engaged catering service provider, fabrication process provider, and accommodation service and storage facilities provider to the Vedanta Group and has progressively diversified into the renewable energy sector, being selected as Power Generator (SPG) for Booth Rathoran, Rohila, Lukhu, Sonari, Malpura GSS 2.52 MW (AC) for each plant project. The firm is led by the promoters who have 25 years of experience in operating and handling the hotel and catering services business. 

ESG Profile

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

Environmental: The firm is operating a solar power project, which is expected to reduce air and water pollution

Social: The firm has not spent any amount on corporate social responsibility

Governance: Since this is a partnership firm, the firm does not have independent directors on the board

KEY COVENANTS OF THE FACILITY RATED

There are standard covenants as per the Sanction Letter

STATUS OF NON-COOPERATION WITH PREVIOUS CRA

Not Applicable

ANY OTHER INFORMATION

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	34.09	BWR BB/Stable (Assignment)	NA	NA	NA	NA	NA	NA
Grand Total		34.09	(Rupees Thirty Four Crores and Nine lakhs Only)

Hyperlink/Reference to applicable Criteria

• General Criteria
• Approach to Financial Ratios
• Power Generation Projects
• Services Sector

Analytical Contacts
Md Saif Ali Khan Rating Analyst saifali.k@brickworkratings.com	Ravi Rashmi Dhar Director - Ratings ravi.d@brickworkratings.com
Client Support | clientsupport@brickworkratings.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	State Bank Of India (SBI)	Term Loan - Out-standing	6.14	_	6.14	Simple##
2	State Bank Of India (SBI)	Term Loan - Out-standing	6.14	_	6.14	Simple##
3	State Bank Of India (SBI)	Term Loan - Out-standing	6.14	_	6.14	Simple##
4	State Bank Of India (SBI)	Term Loan - Out-standing	5.87	_	5.87	Simple##
5	State Bank Of India (SBI)	Term Loan - Sanctioned	6.30	_	6.30	Simple##
6	State Bank Of India (SBI)	Proposed loan - Proposed	3.50	_	3.50	Simple##
Total			34.09	0.00	34.09
TOTAL (Rupees Thirty Four Crores and Nine lakhs Only)

## BWR complexity levels are meant for educating investors. The BWR complexity levels are available at www.brickworkratings.com / download / ComplexityLevels.pdf.

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