Globe Civil Projects Limited has received an income tax demand notice of Rs 80,19,790 for Assessment Year 2018-19, the company disclosed in a regulatory filing on March 30, 2026. The notice was issued under section 156 of the Income Tax Act, 1961 by the Deputy Commissioner of Income Tax Central Circle-27, Delhi.

Tax Demand Details

The demand notice pertains to reassessment proceedings conducted under sections 147/148 of the Income Tax Act, 1961. The company received intimation of the order on March 29, 2026 at 08:03 PM, though the original order was dated March 27, 2026.

Company's Response Strategy

Globe Civil Projects stated it is analyzing the order and will take appropriate course of action, including filing an appeal before the Deputy Commissioner (Appeals) of Income Tax or Commissioner of Income Tax (Appeals)-29, New Delhi. The company emphasized that there is no material impact on its financials, operations, or other activities due to this penalty.

Regulatory Compliance

The disclosure was made pursuant to Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, read with Sub-Para 20 of Para A of Part A of Schedule III. The company filed the disclosure on March 30, 2026, being the first working day after analyzing the order.

Financial Impact Assessment

While the potential impact is quantified at Rs 80,19,790, the company has clarified that this demand does not materially affect its financial position, operations, or other business activities. The final outcome will depend on the appeal process and subsequent proceedings with the income tax authorities.

Globe Civil Projects Limited has received fresh credit ratings from Acuite Ratings and Research Limited for its bank facilities totaling Rs. 110 crore. The rating agency assigned ACUITE BBB+ with stable outlook for long-term facilities and ACUITE A2+ for short-term facilities, marking a transition from previous ratings by Infomerics Ratings.

Rating Details and Facility Breakdown

The comprehensive rating covers various banking facilities across multiple lenders:

The facilities include cash credit lines, bank guarantees, and letters of credit distributed across Canara Bank, ICICI Bank Limited, and Kotak Mahindra Bank Limited.

Key Rating Strengths

Acuite highlighted several positive factors supporting the rating assignment. The company demonstrates an established operational track record spanning over two decades in the civil infrastructure sector. Globe Civil Projects has successfully completed 37 projects and is currently executing 17 ongoing projects across educational institutions, healthcare facilities, railway infrastructure, residential housing, and commercial office segments.

The rating agency noted improving operational scale and profitability margins. Operating income grew by 10.54% to Rs. 325.99 crore in FY 2025 from Rs. 294.91 crore in FY 2024. EBITDA margin improved to 16.57% in FY 2025 against 15.14% in FY 2024, while PAT margin strengthened to 7.38% from 5.22% in the previous year.

Financial Performance and Order Book

The company's financial metrics demonstrate healthy growth trajectory:

A significant positive factor is the healthy unexecuted order book of approximately Rs. 870 crore as of December 31, 2025, providing revenue visibility for the next 2.5-3 years. The company's tangible net worth improved substantially to Rs. 224.87 crore as of September 30, 2025, following the IPO proceeds deployment.

IPO Proceeds and Liquidity Position

Globe Civil Projects was listed on July 1, 2025, through a 100% fresh issue IPO amounting to Rs. 119 crore. The proceeds have been strategically deployed towards working capital requirements, capital expenditure for construction equipment and machinery procurement, and general corporate purposes. As of December 31, 2025, the company maintains unutilized IPO proceeds of Rs. 15.37 crore in fixed deposits, supporting adequate liquidity position.

Rating Concerns and Challenges

Despite the positive rating, Acuite identified certain challenges. The company operates in a working-capital-intensive environment, reflected in elevated gross current asset days of 344 days in FY 2025. This intensity stems from high inventory holding of 150 days and debtor realization period of 160 days, primarily due to bulk material procurement requirements and milestone-based billing cycles.

The tender-based nature of operations exposes the company to intense competition from established EPC contractors and regional players, potentially impacting bid margins and creating volatility in order inflow. Additionally, tender-driven models often involve elongated project award timelines and pricing rigidity.

Management and Operational Track Record

The company, managed by the Khurana family, began operations in 1991 as a proprietorship firm before converting to a limited company in 2002. The management team possesses extensive industry experience, having successfully executed large-scale projects for reputed clients including Delhi Metro Rail Corporation (DMRC), AIIMS Raipur, IIT Gandhinagar, Delhi Public School Society, and Indian Railways.

Source: None/Company/INE0V3U01015/8140af15-9d2b-4e0c-914f-a67aa01b7390.pdf