Stock Report

Transrail Lighting Ltd - 'Crisil AA-/Stable/Crisil A1+' assigned to NCDs and Commercial Paper, Rated amount enhanced for Bank Debt

Posted On : 2026-03-07 09:15:51( TIMEZONE : IST )

Crisil Ratings has assigned its 'Crisil AA-/Stable/Crisil A1+'s ratings to the Rs 100 crore non-convertible debenture (NCD) and Rs 100 crore commercial paper programme of Transrail Lighting Ltd (Transrail). Crisil Ratings has also reaffirmed its ratings on the company's bank facilities at 'Crisil AA-/Stable/Crisil A1+'.

The ratings continue to reflect the established market position of Transrail in the engineering, procurement and construction (EPC) business catering to the power sector, growing and robust order book providing revenue visibility, healthy operating efficiency, and improving financial risk profile. The strengths are partially offset by working capital-intensive operations and exposure to intense competition and industry associated risks being an EPC player.

Transrail's revenue is expected to register 26-28% growth on-year in fiscal 2026, driven by healthy execution of the order book, which stood at Rs 14,733 crore as on December 31, 2025. The company has also emerged as the lowest bidder (L1) for few orders, which, along with the existing order book, will ensure healthy revenue visibility over the medium term. Earnings before interest, tax, depreciation and amortisation (Ebitda) is expected to remain healthy over the medium term, with Ebitda margin expected to be maintained in a similar range as observed in recent fiscals. The business risk profile will also continue to benefit from the strong technological capabilities of Transrail, its increasing market presence and established clientele, and the strong industry outlook of transmission and distribution (T&D) sector in the domestic and international market.

For fiscal 2025, the company generated revenue of Rs 5,294 crore (on-year growth of 30%) with Ebitda margin of 14.5% (14% in fiscal 2024). For the nine months of fiscal 2026, revenue grew 49% to Rs 5,017 crore with healthy Ebitda margin.

The company had unexecuted order of Rs ~2,200 crore as on March 31, 2025, towards a river crossing project in Bangladesh, which has previously seen delays in appointment of engineering consultant and design approvals from client's end. Also, there were delays of 15-20 days due to the political unrest in Bangladesh last fiscal. The project is currently working at a healthy pace with payments being received from the counterparty on a timely basis. Transrail saw healthy revenue contribution of close to Rs ~1,200 crore from this project and is expected to achieve healthy revenue contribution in fiscal 2026 as well. In addition, Transrail's exposure towards the Bangladesh orders has been reducing and was down to ~15% as on March 31, 2025, and is expected to reduce to 5-6% by fiscal 2026 end (~35% in fiscal 2024). The execution of this project and timely receipt of payments from the counterparty will remain monitorable.

The initial public offer (IPO; including pre-IPO in September 2024) with total net proceeds of Rs ~425 crore concluded in December 2024. Out of the total proceeds, Rs 250 crore is being utilised for incremental working capital requirement, Rs 91 crore for capital expenditure (capex) for capacity enhancements in the existing manufacturing facilities and the remaining for general corporate purposes.

The fund raise strengthened Transrail's financial risk profile and improved its key debt metrics. Networth was Rs ~2070 crore as on September 30, 2025 (compared with Rs 1,139 crore as on March 31, 2024). The adjusted gearing (including acceptances) came down to 0.9 time and total outside liabilities to tangible networth (TOLTNW) ratio to 2.3 times (from 1.2 times and 3.03 times, respectively). Besides, the interest coverage ratio improved marginally to 2.7 times in fiscal 2025 from 2.4 times in fiscal 2024; expected to remain around 2.7-3 times over the medium term.

Transrail, along with its promoter (Ajanma Holdings), is proposing to acquire a part of the business of Gammon Engineers and Contractors Pvt Ltd (GECPL), which is facing restructuring by its lenders. This is currently at a preliminary stage and timelines have not been finalised yet. That said, Crisil Ratings expects the payout from Transrail will not be very significant and can be funded from current surpluses and accrual.

The ratings continue to reflect the established market position of Transrail in the EPC business catering to the power sector, growing and healthy order book providing revenue visibility, healthy operating efficiency, and improving financial risk profile. The strengths are partially offset by working capital-intensive operations and exposure to intense competition and industry-associated risks being an EPC player.

Shares of Transrail Lighting Limited was last trading in BSE at Rs. 515.25 as compared to the previous close of Rs. 515.35. The total number of shares traded during the day was 31182 in over 1133 trades.

The stock hit an intraday high of Rs. 535.95 and intraday low of 513.00. The net turnover during the day was Rs. 16266884.00.