Detailed Rationale

Crisil Ratings has reaffirmed its ‘Crisil A/Stable/Crisil A1’ ratings on the bank facilities of GPT Infraprojects Ltd (GPTIL)

 

The ratings continue to reflect the extensive experience of the promoters, sustenance of healthy profitability and healthy financial risk profile. These strengths are partially offset by susceptibility to risks inherent in tender-based business and intense competition, large working capital requirement and sizeable investment commitment towards the HAM Project.

Analytical Approach

For arriving at its ratings, Crisil Ratings has combined the business and financial risk profiles of GPTIL and its subsidiaries, GPT Investments Pvt Ltd, Mauritius, GPT Concrete Products South Africa (Pty.) Ltd, Jogbani Highway Pvt Ltd, RMS GPT Ghana Ltd and Alcon Builders and Engineers Pvt Ltd (a wholly owned subsidiary w.e.f 1st January 2026 post acquisition by GPTIL on 27th February 2026). This is because as all these entities, collectively referred to as the GPT group, have common management and significant financial linkages, and are in the same business.

 

Crisil Ratings has also moderately combined the business and financial risk profiles of GPT ISC JU Highway Pvt Ltd (GPTISCJUHPL), a special-purpose vehicle (SPV), created for HAM project undertaken by GPTIL and ISCPL in Rajasthan with GPTIL having a 51% stake in the SPV. Both the entities are under a common management with operational and financial linkages. Moreover, HAM SPV are moderately consolidated since their debt is non-recourse to the parent. In line with the moderate consolidation approach of Crisil Ratings, the equity requirement and expected cost overrun in projects under implementation have been factored into the financials of the company.

 

Please refer Annexure - List of Entities Consolidated, which captures the list of entities considered and their analytical treatment of consolidation.

Key Rating Drivers - Strengths 

Established market presence, experienced management and reputed clientele: GPTIL has been engaged in the civil construction and railway sleeper manufacturing business for over four decades and has weathered business cycles over the years. The company derives most of its revenue from manufacturing of engineered capital goods and civil construction projects in roads, bridges and railway segment where long-term contracts with clients provide a steady source of revenue. GPTIL has taken up initiatives to diversify its revenue sources on both sides of the value chain, from manufacturing of concrete sleepers to execution of construction projects. The company has geographical and customer diversification which should continue to improve scalability. GPTIL has a well-established customer base with clients like Rail Vikas Nigam Limited (RVNL), NHAI, NHIDCL, Indian Railways amongst others in its portfolio. The diversification is reflective of strong understanding of market dynamics owing to longstanding presence of the promoters in the industry and healthy relationships with customers and suppliers. The key promoters has been associated in the industry over the past three decades and has been instrumental in business expansion and forging client relationships. The extensive experience of the promoters has helped the company bag steady contracts and scale up operations. Order book of around Rs 4,900 crore as on January 1st, 2026 which is to be executed over the next 2-3 years provides healthy revenue visibility in the near term. Backed by strengthening business risk profile through steady order flow as well as ramped up order execution, GPTIL has clocked in an estimated revenue of Rs 875 crore in the first nine months of fiscal 2026 and is expecting to close fiscal 2026 at a turnover of around Rs 1400 crore. Fiscal 2025 revenue stood at 1,188 crore as against 1018 crore in the previous fiscal, exhibiting 17% growth. Consistent growth in the order book and timely execution of contracts is expected to drive the business risk profile, going forward. Maintenance of healthy order book amid eligibility to bid in larger value orders division and established market position in the manufacturing of railway concrete sleepers segment and expected orders from new projects under railway signalling business through ABEPL are likely to support the market position over the medium term. 

 

Favorable industry scenario with higher investments envisaged in end-user industries over the medium term should continue to support business risk profile. New orders from government counterparts shall enable the company in clocking turnover at a compound annual growth rate (CAGR) of more than 20% over the medium term. Timely execution of orders and payment realisations without hindrances will continue to be a monitorable.

 

Operating margin has been healthy at 13.44% in the first nine months of fiscal 2026 on the back of execution of remunerative orders, better operational efficiency through increased scale of operations as well as embedded price escalation clauses in the orders. Margins in the railway signalling business under ABEPL is expected to remain around 20% over the medium term. Going forward, operating margin is expected to be sustained at over 13% over the medium term  driven by benefits from economies of scale, higher productivity and leadership position of the company enabling passage of any hike in key raw material cost to customers.

 

Robust financial risk profile: Financial risk profile should remain supported by healthy accretion to reserves. Networth of the group stood at about Rs 509.60 crore as on March 31st, 2025, as against about Rs 294.63 crore a year earlier backed by steady accretion to reserves as well as funds raised via QIP. With steady accretion to reserve, networth is expected to remain healthy over the medium term despite acquired goodwill of about Rs 120 crore. Capital structure is healthy as reflected by comfortable gearing expected around 0.35-0.40 time amid moderate reliance on external debt and steady accretion to reserves. Total outside liabilities to tangible networth (TOL/TNW) ratio is expected around 1-1.20 times on the back of back to back payment mechanism with subcontractors and labourers and elongation of creditors with greater concentration of order book towards HAM EPC projects wherein payments are realised on milestone basis thereby leading to elongation in debtors and inventory and payment to subcontractors is made post realisation of bills. Nevertheless, it is expected to improve over the medium term backed by steady accretion to reserves. Debt protection metrics should also remain comfortable with interest coverage ratio expected around 5-6 times and net cash accrual to total debt (NCA/TD) ratio around 0.50 times going forward. Going forward, sustenance of financial risk profile amidst funding requirement towards HAM projects will remain a key monitorable, though steady accretion to reserves and absence of sizeable capex plan will provide the required cushion and financial flexibility to do so.

Key Rating Drivers - Weaknesses 

Large working capital requirement: Operations are working capital intensive due to tender based nature of business and the company primarily undertaking civil construction contracts under and supply of railway concrete sleepers to public sector organisations such as Indian Railways, National Highway Authority of India (NHAI), Rail Vikas Nigam Limited (RVNL) amongst others. Supply to large organisations in roads, bridges and railway segment which exercise considerable bargaining power, entails a long credit period. Furthermore, in the EPC business, receivables are elongated due to the long execution period of projects, milestone-based payments and the retention money requirement that is released post the defect liability period. Besides, the project billing and delivery schedule is usually concentrated towards the end of every fiscal, with more than 40 per cent of the sales in Q4, resulting in elevated working capital indicators as on year ending dates. The company has higher unbilled revenue as the business model entails construction of bridges with longer execution periods and billing is done on milestone basis only after approval by authorities. Bills being raised on milestone basis are realised within 30 days post submission. With great thrust of the government on infrastructural development, fast execution of budgeted projects and diversification in the order book with reduced contribution from longer payment cycle projects, debtor cycle has improved considerably from fiscal 2023 onwards and is expected to be sustained going forward as well. Diversification in order book in terms of counterparties, business segments and geography over the years has ensured strong scale of operations over the years. The inventory levels of the company have been moderate around 120-150 days owing to the lengthy order execution cycle and work in progress, which entails multiple inspections at various stages of execution. Uncertified work done on the project remains unbilled, as billing is done on milestone basis after certification of a portion of work done as per the tender terms. Consequently, GCA days net of liquid investments is expected around 180 days over the medium term marked by other current assets comprising unbilled revenue, retention money and inventory days.

 

Although, the company has been receiving timely payments owing to budgetary allocations in place and on the back of robust industry demand scenario, any unprecedented stretch in the working capital cycle will remain a key rating sensitivity factor.

 

Exposure to risks inherent in tender-based business amid intense competition: GPTIL undertakes construction under engineering, procurement and construction model (EPC) and bags projects by submitting bids for tenders floated by government entities. Hence, revenue and profitability depend on ability to bid successfully for tenders. Intense competition due to presence of several mid-sized players may continue to constrain scalability, pricing power and profitability. Moreover, expenditure by government agencies and public sector undertakings is directly linked to the economy. Any delay or deferment of capex in end-user industries could constrain scalability. Tender based operations is a key risk factor, as regulatory changes, pressure on budgets of government departments or any slowdown in infrastructure expenditure can significantly impact revenue and the realisation cycle. Growth in revenue also depends largely on the company's ability to bid successfully and remains susceptible to intense competition from several local players. However, this risk is mitigated by the longstanding presence of GPTIL in the region, where entry barriers are high, as players require technical know-how and a strong track record to qualify for tenders. Going forward, receipt of new orders and their timely execution thereafter leading to a healthy order book position and sustenance of healthy operating profitability remains a key rating sensitivity factor.

 

Sizeable investment commitment towards the HAM Project: GPTIL has forayed into a road HAM (Hybrid Annuity Model) project through an SPV (special purpose vehicle) named GPTISCJUHPL has a stake of 51% in the SPV and has been awarded a HAM project for road construction under National Highways Authority of India (NHAI) with a total bid project cost of Rs 779.36 crore in Rajasthan. GPTIL shall be investing Rs 50.98 crore in the SPV which remains the total investment expected from GPTIL towards the project with no further equity infusion or investment. GPTIL also extend support to its SPV undertaking HAM project to fund the initial equity and cover any cost escalations over the construction phase or any shortfall in the operational phase. Implementation risk exists since the road HAM project being undertaken in the SPV is currently under construction. However, as a result of the GPTIL’s track record in completing previous road projects in a timely manner, company is likely to complete the ongoing HAM project without any cost overruns and in a timely manner. Healthy cash accrual generation, surplus unencumbered liquidity shall support financial flexibility amidst any unanticipated investment towards the HAM project. Risks related to timely completion and commencement of project would remain and any large unanticipated fund support from GPTIL to the SPV thereby adversely impacting the financial risk profile and liquidity position would be key rating monitorable.

Liquidity Strong

Fund based bank limit utilisation of the company averaged 69% over the past twelve months through December, 2025. With respect to ABEPL, the utilisation on the overdraft facility remains negligible over the past twelve months ending January 2026. Cash accrual of the group is expected to be Rs around 100-150 crore per annum over the medium term which shall support incremental working capital requirements and cushion liquidity to meet any exigencies towards the SPV for the new HAM project being undertaken in GPTISCJUHPL. Furthermore, healthy cashflow generation should support term debt repayment obligations of about Rs 15-30 crore per annum over the medium term. Current ratio was healthy at 1.85 times on March 31, 2025 and is likely to remain around 1.50 times over the medium term. The promoters are likely to extend support in the form of unsecured loans. Unencumbered cash and bank balance and fixed deposits of around Rs 17 crore exists with the company as on December 2025 further supported by additional unencumbered liquidity of about Rs 15 crore as on December 2025 in ABEPL. Low gearing and healthy networth support financial flexibility and provide a financial cushion in case of any adverse conditions or downturns in the business.

Outlook Stable

GPTIL will continue to benefit from its established business risk profile over the medium term, supported by its healthy order position and established market presence in the construction of roads and bridges and manufacturing of sleepers division, thereby ensuring healthy cash generation. The financial risk profile is likely to remain healthy, driven by sustenance of comfortable capital structure with no major debt funded capital expenditure (capex) plans

Rating sensitivity factors

Upward factors

• Substantial increase in scale of operations to around Rs 2000 crore on the back of healthy order book flow and timely execution along with sustenance of diversification in order book and operating margin leading to higher generation of cash accruals on a sustained basis.
• Sustenance of healthy financial risk profile with no large unprecedented debt funded capital expenditure (capex) or acquisition and healthy liquidity levels

 

Downward factors

• Deterioration in business risk profile induced by subdued revenue and order inflow and/or inordinate delays in receivables or order execution and dip in profitability thereby leading to lower cash accruals of below Rs 50 crore on a sustained basis.
• Large debt funded capital expenditure or higher than expected funding support to SPV towards the HAM project  or large stretch in working capital operations adversely impacting the financial and liquidity risk profile

About the Group

GPTIL is the flagship company of the GPT group, which undertakes civil infrastructure projects such as construction of roads and bridges and manufactures concrete sleepers and iron castings for railways. GPTIL has been promoted by Dr. Om Tantia (Chairman), Mr. Gopal Tantia (Managing Director), Mr. Atul Tantia (Joint Managing Director and CFO), Mr. Vaibhav Tantia (Director and COO) and Mr. Amrit Jyoti Tantia (Director, Projects). Civil infrastructure projects contribute about 90-95% of the total turnover and manufacturing of concrete sleepers contribute about 5-10% of the total turnover of the group.

 

Alcon Builders and Engineers Private Limited (ABEPL) was incorporated in 1988, and is a Delhi based company. ABEPL undertakes signalling and allied civil infrastructural works for Indian Railways. ABEPL was erstwhile owned & managed by Mr. Ajit Kumar Vaswani and Mrs. Tara Vaswani post which the company has been acquired by GPTIL on 27th February 2026 and has become a wholly owned subsidiary of GPTIL. The acquisition was done for an aggregate cash consideration of Rs 151.83 crore.

 

GPT ISC JU Highway Pvt Ltd (hereinafter referred to as the Concessionaire) is a special purpose vehicle company promoted by GPTIL (51% stake) and ISC Projects Pvt Ltd (49% stake) (or the Project Sponsors) to undertake “Construction of Four Lane Elevated Road in Jodhpur city portion from Mahamandir (CH. 0+000) to Akhaliya Chouraha (CH. 7+633) in State of Rajasthan on HAM mode.” The Government of India had entrusted to the National Highway Authority of India (NHAI) to undertake the said project in accordance with the terms and conditions to be set forth in a Concession Agreement. GPT is to have a 51% stake in the SPV. The concession agreement has been executed with NHAI in late February 2026.
 

Letter of Acceptance (LOA) was received on 31st December 2025 and the construction period is 912 days, with commercial operation date (COD) being in June 2028.

 

The total cost of the project is 779.36 crore which shall be funded by way of debt of Rs 361.53 crore, grant of 315.86 crore and equity of Rs 101.97 crore. Out of the total equity contribution, GPTIL is expected to infuse Rs 50.98 crore. Financial closure is yet to happen and no further infusion/support is expected from GPTIL towards the SPV.  

Key Financial Indicators (Consolidated)*

Particulars	Unit	2025	2024
Revenue	Rs crore	1188.07	1018.28
Profit after tax (PAT)	Rs crore	74.01	55.64
PAT margin	%	6.23	5.46
Adjusted debt / adjusted networth	Times	0.25	0.64
Interest coverage	Times	5.30	3.87

*Crisil Ratings’ adjusted financials

Any other information: Not applicable