ICRA reaffirms credit rating of KPI Global Infra; Revises outlook to positive

12 Jan 2022 , 03:29 PM

ICRA has reaffirmed the credit rating of KPI Global Infrastructure Limited and changed the outlook on long-term rating to positive from stable.

The rating on term loans Rs183.75cr has been reaffirmed at ICRA BBB+; outlook changed to Positive from Stable. On Cash Credit Rs13cr, ICRA BBB+ rating was reaffirmed; outlook changed to Positive from Stable.

The credit rating agency also reaffirmed ICRA A2 rating on Working Capital Demand Loans Rs2.75cr ICRA A2, Bank Guarantee Rs0.50cr and Bank Guarantee Rs(2cr) ICRA A2.

Towards close of trade on Wednesday, KPI Global Infra stock was trading at Rs406.25 up Rs11.20 or 2.84% on the BSE.

“To arrive at the ratings, ICRA has considered consolidated financials of K.P.I. Global Infrastructure Ltd. (KPIGIL) and its wholly owned subsidiaries, KPIG Energia Private Limited (KPIGEPL) and Sun Drops Energia Private Limited (SDEPL), referred to as the Group.

The revision in the outlook to Positive reflects the expected improvement in the scale and profitability at the Group level following higher execution of captive power plant (CPP) orders and commissioning of ~28 MW capacities under the subsidiaries (full capacities expected to be operational from Q1FY23 onwards) in the near term,” company shared ICRA’s rating rationale.

It said, the outstanding CPP order book as on December 14, 2021 was healthy at ~Rs180.00cr (44.3 MW), which is expected to be executed over the next six months. In FY2021, KPIGIL͛s revenue grew at a healthy rate of ~75% to Rs103.50cr from Rs59.28cr in FY2020 owing to the increase in the independent power producer (IPP) capacity and substantial increase in the CPP projects undertaken.

Further, in the current fiscal, the Group achieved a revenue of Rs92.85cr (including CPP sales in KPIG Energia) in 6MFY2021, and is expected to post a healthy YoY revenue growth of more than 90% in FY2022. ICRA expects the growing CPP business, timely commissioning of the new capacities under IPP and the remunerative tariff rates to improve the credit profile of the Group going forward.