RATING RATIONALE

26Feb2026

J. P. Enterprises

Brickwork Ratings has upgraded the long-term and short-term ratings for the bank loan facilities of Rs. 72.00 crore of J. P. Enterprises and has simultaneously removed the company from the Issuer Not Cooperating (INC) category.

Particulars

Facilities**	Amount (Rs.Crs.)		Tenure	Rating#
Facilities**	Previous	Present	Tenure	Previous (14 Jul 2025)	Present
Fund Based	13.50	20.00	Long Term	BWR B- /Stable Continues to be in ISSUER NOT COOPERATING* category/Downgraded	BWR BBB - /Stable removal from ISSUER NOT COOPERATING* category/Upgraded
Non Fund Based	50.00	52.00	Short Term	BWR A4 Continues to be in ISSUER NOT COOPERATING* category/Reaffirmed	BWR A3 removal from ISSUER NOT COOPERATING* category/Upgraded
Grand Total	63.50	72.00	(Rupees Seventy Two Crores 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

RATING ACTION / OUTLOOK

Brickwork Ratings has upgraded the long-term rating to BWR BBB- (Stable) and the short-term rating to BWR A3 for the bank loan facilities of Rs. 72.00 crore of J. P. Enterprises, and has simultaneously removed the company from the Issuer Not Cooperating (INC) category.

The upgrade factors in the firm’s established track record of over five decades in cement concrete road construction, a healthy and diversified order book, and a comfortable financial risk profile marked by moderate leverage and adequate debt coverage indicators. The ratings also draw comfort from the company’s strong in-house execution capabilities through its network of RMC plants across Maharashtra and continued support from partners. However, the credit profile remains constrained by the inherently working capital-intensive nature of government EPC operations, elevated payable days indicating reliance on supplier credit, moderate operating margins typical of the segment, and dependence on timely enhancement of bank guarantee and working capital limits to support growth.

The Stable outlook reflects expectations that J P Enterprises will continue to benefit from its established track record in cement concrete road construction, a healthy executable order book, and strong in-house execution capabilities. The outlook also factors in the firm’s comfortable financial risk profile, characterised by moderate leverage, adequate debt coverage indicators, and steady cash accruals over the medium term.

KEY RATING DRIVERS

Credit Strengths:

Established operating track record and experienced management :
JP Enterprises benefits from the extensive experience of its promoters, led by Mr. Kantilal M. Shah, who has over five decades of experience in the civil construction industry. The involvement of the second and third generations ensures leadership continuity and operational stability. The firm has built execution capabilities across project management, finance, and RMC operations, enabling scalable growth across multiple locations in Maharashtra. Its long-standing presence of nearly 50 years in government contracting provides institutional credibility and relationship strength with various departments.
Strong niche positioning in cement concrete road construction :
The firm has developed deep expertise in cement concrete (CC) road construction, which constitutes nearly 90% of its operational portfolio. This focused positioning has supported consistent revenue growth, with total operating income increasing from Rs. 118.73 crore in FY2023 to Rs. 157.05 crore in FY2024 and further to Rs. 242.36 crore in FY2025. In 9MFY2026, the company has already reported operating income of Rs. 201.40 crore and, as of January 31, 2026, has achieved revenue of Rs. 216.19 crore, reflecting continued scale-up. Cement concrete roads are increasingly preferred by government authorities due to durability, lower lifecycle cost, and suitability for high-traffic corridors, positioning the firm to benefit from sustained policy thrust toward road concretisation.
Robust order book providing medium-term revenue visibility :
As on January 31, 2026, JP Enterprises reported a total order book of Rs. 1,138.67 crore, with a balance work in hand of Rs. 835.31 crore across 53 work orders. The order book is diversified across multiple government departments, including PWD and municipal corporations, mitigating concentration risk. In addition, the firm has quoted for 8 new tenders and expects conversion of at least 2–3 projects. The existing executable pipeline provides revenue visibility of approximately two to three years at the current execution scale.
Strong in-house infrastructure and execution capability :
The firm owns 11 in-house RMC plants across Maharashtra, along with transit mixers and key construction equipment. High asset ownership reduces dependence on third-party suppliers, improves cost control, and enhances execution flexibility. Availability of in-house infrastructure also lowers incremental capital expenditure requirements for new projects, supporting operating efficiency during scale-up.
Favourable industry outlook and profitability :
The outlook for cement concrete road construction remains stable, supported by sustained government focus on building durable infrastructure. Maharashtra continues to witness significant road concretisation initiatives, which are expected to generate steady demand for contractors and RMC operators. The firm’s established technical expertise and proven execution track record position it well to capitalise on this demand pipeline.

Reflecting this favourable environment, the company has demonstrated steady financial improvement. Operating profitability in absolute terms increased to Rs. 15.79 crore in FY2025 from Rs. 11.62 crore in FY2024, although margins moderated to 6.52% due to higher input costs and scale-up-related expenses. PAT rose to Rs. 12.55 crore in FY2025 from Rs. 7.69 crore in FY2024, with the net margin stabilising at 5.18%. For 9MFY2026, EBITDA stood at Rs. 24.23 crore, supported by efficient project execution and cost control, while PAT was Rs. 16.11 crore, indicating continued bottom-line improvement. Overall scalability remains healthy, with moderate but stable margins typical of the EPC segment.
Comfortable financial risk profile :
The financial risk profile remains comfortable, supported by strengthening net worth and moderate leverage. Tangible net worth increased to Rs. 55.66 crore as on March 31, 2025, supported by retained earnings. Total borrowings reduced to Rs. 26.97 crore in 9MFY2026 from Rs. 32.08 crore earlier, reflecting prudent debt management. With Total Debt/TNW at 0.80x and TOL/TNW at 1.48x in FY2025, indicating a prudent financial risk profile.

Debt protection metrics remain comfortable, with interest coverage at 7.44x and DSCR at 3.74x in FY2025. Net cash accruals of Rs. 15.13 crore adequately covered debt obligations of Rs. 3–4 crore. Despite incremental working capital requirements due to scale-up, coverage indicators are expected to remain adequate over the medium term.

Credit Risks:

Large working capital requirement :
Operations remain inherently working capital intensive, driven by receivables (30–50 days), retention money, earnest money deposits, and security deposits linked to government contracts. In addition, substantial funds remain blocked in bank guarantee margins and non-current investments amounting to Rs. 34.53 crore, largely comprising BG margin FDRs and project-linked deposits.

The company also reported elevated payable days of approximately 333 days, indicating partial reliance on supplier credit to bridge working capital gaps. While vendor relationships of 10–15 years provide operational flexibility, the stretched payable cycle reflects working capital pressure. With a sizeable executable order book of Rs. 835.31 crore and projected scale-up to ~Rs. 350 crore in FY2026, incremental working capital requirements are expected to remain significant. Liquidity is adequate but tightly managed, as reflected in high CC utilisation levels.
High reliance on bank guarantees and collateral :
As a government EPC contractor, the firm is required to furnish substantial bank guarantees toward EMD and security deposits. The company has provided significant collateral support, including FDRs and immovable properties, to secure BG limits. High utilisation of fund-based and non-fund-based limits constrains incremental order intake, making the timely enhancement of CC and BG limits critical for sustaining growth.
Partnership constitution with limited financial flexibility :
JP Enterprises operates as a partnership firm with ownership concentrated within the promoter family. While this structure ensures stability and strong promoter commitment, it limits access to external equity capital and results in greater reliance on bank funding and internal accruals for expansion. In such a structure, moderation in partner withdrawals remains important to preserve net worth and liquidity buffers.

ANALYTICAL APPROACH - Standalone

For arrive at its ratings, BWR has applied its rating methodology as detailed in the Rating Criteria, as detailed below (hyperlinks provided at the end of this rationale).

RATING SENSITIVITIES

Positive Sensitivities

The ratings could witness upward movement in case of sustained improvement in scale and profitability, with revenue consistently exceeding Rs. 340.00 crore and OPBDIT margins maintained at 7.0% or above, supported by timely execution of the order book.
Strengthening of the financial risk profile, reflected in Total Debt to Tangible Net Worth remaining below 0.80x and interest coverage (ISCR) sustaining above 4.0x on a sustained basis.

Negative Sensitivities

Deterioration in operating performance, with revenue falling below Rs. 220 crore or OPBDIT margins declining below 4.0%, particularly due to execution delays or cost overruns.
Any weakening in leverage and liquidity metrics, evidenced by Total Debt to Tangible Net Worth rising above 1.3x or ISCR declining below 2.0x on a sustained basis

LIQUIDITY INDICATORS - Adequate

The liquidity profile of J P Enterprises remains adequate, supported by healthy cash accruals, established banking relationships, and disciplined working capital management. The firm maintained cash and bank balances of Rs. 12.51 crore as on March 31, 2025. Working capital utilisation reflects active operations, with average cash credit utilisation at 87.52% and peak utilisation at 98.78% during the 12 months ended January 2026, indicating efficient use of sanctioned limits without sustained liquidity stress. Net cash accruals of Rs. 15.13 crore in FY2025 remain sufficient to cover annual debt repayment obligations estimated at around Rs. 3.00–4.00 crore. Liquidity is further supported by unsecured loans of Rs. 5.64 crore from partners and an adequate current ratio of 1.49x in FY2025, providing reasonable short-term financial flexibility. The working capital cycle also benefits from relatively favourable payment terms from customers. However, considering the firm’s expanding scale of operations, sizeable executable order book, and continued reliance on bank guarantees and security deposits typical of EPC contractors, effective liquidity management will remain a key monitorable over the medium term.

ABOUT THE ENTITY

Macro Economic Indicator	Sector	Industry	Basic Industry
Industrials	Construction	Construction	Civil Construction

JP Enterprises (JPE) is a partnership firm established in 1988 and primarily engaged in engineering, procurement, and construction (EPC) of roads, with a strong specialisation in cement concrete road construction. The firm is led by Mr. Kantilal M. Shah, who has over five decades of experience in the civil construction industry, supported by the active involvement of the second and third generations of the promoter family.

JPE undertakes projects mainly for government and semi-government authorities such as Public Works Departments (PWDs), municipal corporations, and other public bodies. The company operates predominantly in Maharashtra and has expanded its execution footprint across multiple regions, supported by its in-house infrastructure, including 11 RMC plants and a fleet of transit mixers and construction equipment.

Over the years, the firm has built a healthy order book and demonstrated strong execution capabilities, reflected in its growing scale of operations and established niche positioning in cement concrete roads, which contributes the majority of its revenue.

ESG Profile

Environmental: Environmental risks in EPC and RMC operations are primarily linked to construction-site impacts, resource consumption, waste generation, and equipment emissions. J P Enterprises follows standard site restoration and rehabilitation practices in line with contractual and regulatory requirements. The firm undertakes basic construction and demolition (C&D) waste segregation and disposal through authorised channels, where applicable. Fuel efficiency and operational controls are followed to manage energy use; however, formal carbon reduction targets and structured environmental monitoring frameworks are not yet established. Overall regulatory compliance is reported to be adequate, with no major environmental violations observed.

Social: Social risk management centres on workforce health and safety across project sites. The firm reports compliance with applicable labour laws and maintains safety practices such as the use of personal protective equipment (PPE), periodic safety briefings, and on-site supervision. Workforce training and skill development initiatives are undertaken on a need basis. However, formal diversity, inclusion, and structured employee welfare disclosures remain limited, and community engagement activities are largely project-driven and modest in scale.

Governance: Governance remains promoter-driven, consistent with the firm’s partnership structure. While formal board independence is not applicable, the entity maintains basic internal controls, financial oversight, and compliance monitoring mechanisms. Risk management and documentation systems are functional but relatively evolving in sophistication. Project-level ESG risk assessment, vendor screening, and formal policy frameworks are currently limited but show gradual improvement. Site-level emergency response procedures are reported to be in place.

Overall ESG Conclusion: Evolving
The firm demonstrates an evolving ESG profile. While it adheres to standard regulatory and operational practices typical for EPC contractors and RMC operators, the depth of formal ESG policies, structured disclosures, and quantified sustainability initiatives remains limited. Strengthening formal ESG frameworks, disclosures, and monitoring systems could further enhance the overall sustainability profile over the medium term.

KEY FINANCIAL INDICATORS (Standalone)

Key Parameters	Units	FY 22 - 23 (Audited)	FY 23 - 24 (Audited)	FY 24 - 25 (Audited)
Operating Revenue	Rs.Crs.	118.89	157.09	242.37
EBITDA	Rs.Crs.	11.72	11.62	15.79
PAT	Rs.Crs.	7.86	7.69	12.55
Tangible Net Worth	Rs.Crs.	49.20	46.42	55.66
Total Debt / Tangible Net Worth	Times	0.59	0.70	0.80
Current Ratio	Times	1.46	1.49	1.49

KEY COVENANTS OF THE FACILITY RATED

The terms of the sanction include standard covenants typically required for such facilities.

STATUS OF NON-COOPERATION WITH PREVIOUS CRA

Creadit Rating Agency Status and Reason for Non-Cooparation Date of Press Release
CRISIL Crisil Ratings has migrated the ratings on bank facilities to Issuer not cooperating on account of the lack of management cooperation towards non-payment of fees, 16Jan2026
ACUITE The rating continues to be flagged as “Issuer Not-Cooperating” and is based on the best available information on account of the lack of management cooperation towards non-payment of fees. 13Jan2026

Creadit Rating Agency	Status and Reason for Non-Cooparation	Date of Press Release
CRISIL	Crisil Ratings has migrated the ratings on bank facilities to Issuer not cooperating on account of the lack of management cooperation towards non-payment of fees,	16Jan2026
ACUITE	The rating continues to be flagged as “Issuer Not-Cooperating” and is based on the best available information on account of the lack of management cooperation towards non-payment of fees.	13Jan2026

RATING HISTORY FOR THE PREVIOUS 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	20.00	BWR BBB-/Stable (removal from ISSUER NOT COOPERATING* category/Upgraded)	14Jul2025	BWR B- Stable (Continues to be in ISSUER NOT COOPERATING* category/Downgraded)	22Jul2024	BWR B Stable (Continues to be in ISSUER NOT COOPERATING* category/Downgraded)	26Jun2023	BWR B+ Stable (Continues to be in ISSUER NOT COOPERATING* category/Downgraded)
Non Fund Based	ST	52.00	BWR A3 (removal from ISSUER NOT COOPERATING* category/Upgraded)	14Jul2025	BWR A4 (Continues to be in ISSUER NOT COOPERATING* category/Reaffirmed)	22Jul2024	BWR A4 (Continues to be in ISSUER NOT COOPERATING* category/Reaffirmed)	26Jun2023	BWR A4 (Continues to be in ISSUER NOT COOPERATING* category/Reaffirmed)
Grand Total		72.00	(Rupees Seventy Two Crores Only)

Hyperlink/Reference to applicable Criteria

Analytical Contacts
Shreekant Digambar Kadere Senior Rating Analyst shreekant.dk@brickworkratings.com	Niraj Kumar Rathi Senior Director Ratings niraj.r@brickworkratings.com
1-860-425-2742 \| media@brickworkratings.com	Customer Support \| CustSupport@brickwrokratings.com

J. P. Enterprises

ANNEXURE-I

Details of Bank Facilities rated by BWR

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	Bank of Maharashtra	Cash Credit - Sanctioned	20.00	_	20.00	Simple##
2	Bank of Maharashtra	Bank Guarantee - Sanctioned	_	52.00	52.00	Simple##
Total			20.00	52.00	72.00
TOTAL (Rupees Seventy Two Crores 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.

ANNEXURE-II

INSTRUMENT DETAILS

Instrument	Issue Date	Amount (Rs.Crs)	Coupon Rate (%)	Maturity Date	ISIN Particulars	Complexity of the Instrument
Nil	Nil	Nil	Nil	Nil	Nil	Nil

ANNEXURE-III

List of entities consolidated

Name of Entity	% Ownership	Extent of consolidation	Rationale for consolidation
Nil	Nil	Nil	Nil

Print and Digital Media

The Rating Rationale is sent to you for the sole purpose of dissemination through your print, digital or electronic media. While it may be used by you acknowledging credit to BWR, please do not change the wordings in the rationale to avoid conveying a meaning different from what was intended by BWR. BWR alone has the sole right of sharing (both direct and indirect) its rationales for consideration or otherwise through any print or electronic or digital media.

About Brickwork Ratings

Brickwork Ratings (BWR), a Securities and Exchange Board of India [SEBI] registered Credit Rating Agency and accredited by Reserve Bank of India [RBI], offers credit ratings of Bank Loan, Non- convertible / convertible / partially convertible debentures and other capital market instruments and bonds, Commercial Paper, perpetual bonds, asset-backed and mortgage-backed securities, partial guarantees and other structured / credit enhanced debt instruments, Security Receipts, Securitization Products, Municipal Bonds, etc. BWR has rated over 11,560 medium and large corporates and financial institutions’ instruments. BWR has also rated NGOs, Educational Institutions, Hospitals, Real Estate Developers, Urban Local Bodies and Municipal Corporations. BWR has Canara Bank, a leading public sector bank, as one of the promoters and strategic partner.

Disclaimer

Brickwork Ratings India Pvt. Ltd. (BWR), a Securities and Exchange Board of India [SEBI] registered Credit Rating Agency and accredited by the Reserve Bank of India [RBI], offers credit ratings of Bank Loan facilities, Non- convertible / convertible / partially convertible debentures and other capital market instruments and bonds, Commercial Paper, perpetual bonds, asset-backed and mortgage-backed securities, partial guarantees and other structured / credit enhanced debt instruments, Security Receipts, Securitization Products, Municipal Bonds, etc. [ hereafter referred to as "Instruments"]. BWR also rates NGOs, Educational Institutions, Hospitals, Real Estate Developers, Urban Local Bodies and Municipal Corporations.

BWR wishes to inform all persons who may come across Rating Rationales and Rating Reports provided by BWR that the ratings assigned by BWR are based on information obtained from the issuer of the instrument and other reliable sources, which in BWR's best judgment are considered reliable. The Rating Rationale / Rating Report & other rating communications are intended for the jurisdiction of India only. The reports should not be the sole or primary basis for any investment decision within the meaning of any law or regulation (including the laws and regulations applicable in Europe and also the USA).

BWR also wishes to inform that access or use of the said documents does not create a client relationship between the user and BWR.

The ratings assigned by BWR are only an expression of BWR's opinion on the entity / instrument and should not in any manner be construed as being a recommendation to either, purchase, hold or sell the instrument.

BWR also wishes to abundantly clarify that these ratings are not to be considered as an investment advice in any jurisdiction nor are they to be used as a basis for or as an alternative to independent financial advice and judgment obtained from the user's financial advisors. BWR shall not be liable to any losses incurred by the users of these Rating Rationales, Rating Reports or its contents. BWR reserves the right to vary, modify, suspend or withdraw the ratings at any time without assigning reasons for the same.

BWR's ratings reflect BWR's opinion on the day the ratings are published and are not reflective of factual circumstances that may have arisen on a later date. BWR is not obliged to update its opinion based on any public notification, in any form or format although BWR may disseminate its opinion and analysis when deemed fit.

Neither BWR nor its affiliates, third party providers, as well as the directors, officers, shareholders, employees or agents (collectively, "BWR Party") guarantee the accuracy, completeness or adequacy of the Ratings, and no BWR Party shall have any liability for any errors, omissions, or interruptions therein, regardless of the cause, or for the results obtained from the use of any part of the Rating Rationales or Rating Reports. Each BWR Party disclaims all express or implied warranties, including, but not limited to, any warranties of merchantability, suitability or fitness for a particular purpose or use. In no event shall any BWR Party be liable to any one for any direct, indirect, incidental, exemplary, compensatory, punitive, special or consequential damages, costs, expenses, legal fees, or losses (including, without limitation, lost income or lost profits and opportunity costs) in connection with any use of any part of the Rating Rationales and/or Rating Reports even if advised of the possibility of such damages. However, BWR or its associates may have other commercial transactions with the company/entity. BWR and its affiliates do not act as a fiduciary.

BWR keeps certain activities of its business units separate from each other in order to preserve the independence and objectivity of the respective activity. As a result, certain business units of BWR may have information that is not available to other BWR business units. BWR has established policies and procedures to maintain the confidentiality of certain non-public information received in connection with each analytical process.

BWR clarifies that it may have been paid a fee by the issuers or underwriters of the instruments, facilities, securities etc., or from obligors. BWR's public ratings and analysis are made available on its web site, www.brickworkratings.com. More detailed information may be provided for a fee. BWR's rating criteria are also generally made available without charge on BWR's website.

This disclaimer forms an integral part of the Ratings Rationales / Rating Reports or other press releases, advisories, communications issued by BWR and circulation of the ratings without this disclaimer is prohibited.

BWR is bound by the Code of Conduct for Credit Rating Agencies issued by the Securities and Exchange Board of India and is governed by the applicable regulations issued by the Securities and Exchange Board of India as amended from time to time.