Dredging Corporation of India Limited has received reaffirmed credit ratings from Care Edge Rating for its bank facilities, maintaining its investment-grade status despite operational challenges. The rating agency has confirmed its assessment of the company's financial position and operational capabilities in the dredging sector.

Credit Rating Details

Care Edge Rating has reaffirmed ratings for the company's bank facilities totaling ₹453.64 crore across multiple categories:

The rating reaffirmation reflects the company's established market position and strong promoter support, while acknowledging ongoing operational and financial challenges.

Financial Performance and Challenges

The company demonstrated revenue growth with total operating income rising to ₹1,142 crore in FY25 from ₹945 crore in FY24, representing a 21% year-on-year increase. This growth continued in H1FY26 with revenue reaching ₹454 crore compared to ₹355 crore in H1FY25, marking a 28% increase.

Despite revenue growth, profitability faced significant pressure due to liquidated damages of ₹118 crore levied for performance shortfalls and foreign exchange losses on unhedged Euro-denominated borrowings. The company reported net losses in both FY25 and H1FY26.

Promoter Support and Order Book Position

The company benefits from strong promoter backing through a consortium of four major port trusts: Visakhapatnam Port Trust, Paradip Port Trust, Jawaharlal Nehru Port Trust, and Deendayal Port Trust. These promoters have provided ₹315 crore in unsecured loans as of March 31, 2025, with an additional ₹165 crore received during FY25 to support operations and new dredger acquisition.

The order book position remains satisfactory at ₹1,422 crore as of September 30, 2025, compared to ₹1,005 crore as of August 14, 2024. This provides revenue visibility for approximately 1.25 years, with the top five orders accounting for 83% of the total order book.

Fleet Modernization and Future Outlook

The company is addressing its aging fleet challenges through a significant modernization initiative. A new Trailing Suction Hopper Dredger with 12,000 cubic meter capacity is under construction at Cochin Shipyard Limited at a cost of €89.39 million. The project is financed through a €49.9 million ECB loan from Deutsche Bank, with the balance funded by promoter contributions and non-convertible debentures.

The new dredger, scheduled for commissioning by October 2026, is expected to enhance operational efficiency, reduce fuel costs, and support both maintenance and capital dredging activities. This modernization effort aims to improve the company's competitive position and revenue profile from FY27 onwards.

Risk Factors and Rating Sensitivities

The rating agency identified several key risk factors including the aging fleet resulting in high maintenance expenses, vulnerability to foreign exchange fluctuations, and increased competition from domestic and international players. The company incurred ₹34 crore in forex losses during H1FY26 on its unhedged Euro loan exposure.

Positive rating factors include maintaining operations above ₹1,000 crore with PBILDT margins over 18% and improving collection days below 200 days. Negative factors encompass increased working capital intensity and overall gearing above 1.5x on a sustained basis.

Dredging Corporation of India Limited (DCI) has issued a formal postal ballot notice to shareholders for the approval of Shri Gaurav Dayal's appointment as Additional Director, following the earlier board approval through Resolution by Circulation.

Postal Ballot Notice Details

The company has officially communicated to stock exchanges regarding the postal ballot process for formal shareholder approval. The notice, dated January 2, 2026, outlines the complete procedure for electronic voting on the director appointment.

Director Appointment Details

Shri Gaurav Dayal, IAS, was initially appointed as Additional Director (Promoter-Non Executive) through board resolution on November 7, 2025. The postal ballot seeks formal shareholder approval for his regular appointment as Director.

Professional Background

Shri Gaurav Dayal brings over two decades of administrative experience to DCI's board. His distinguished career includes serving as Secretary (Home & Vigilance) in Uttar Pradesh and Divisional Commissioner of Ayodhya, where he played a pivotal role in the city's transformation into a global religious tourism destination.

E-voting Process

The company has engaged National Securities Depository Limited (NSDL) and KFin Technologies Limited to facilitate the remote e-voting process. Shareholders can cast their votes electronically through multiple platforms including depository websites and the company's designated e-voting portal.

Regulatory Compliance

DCI has confirmed compliance with all regulatory requirements under the Companies Act, 2013, SEBI (LODR) Regulations 2015, and other applicable provisions. The company has duly informed both BSE (Scrip Code: 523618) and NSE about the postal ballot process as per Regulation 30 requirements.

The resolution, if approved by shareholders, will be deemed passed on February 2, 2026, the last date of e-voting, formally completing Shri Gaurav Dayal's appointment to DCI's board of directors.