GK Energy Limited has received comprehensive credit rating upgrades from Infomerics Valuation and Rating Ltd, reflecting the company's strong operational performance and improved financial metrics. The upgrades announced on December 12, 2025, cover all bank facilities totaling ₹300.00 crores.

Credit Rating Upgrades Overview

Infomerics has upgraded ratings across multiple facility categories, demonstrating confidence in GK Energy's creditworthiness and operational capabilities.

The stable outlook reflects expected growth in revenue and profitability with stable debt protection metrics over FY26-FY28.

Strong Financial Performance Drives Upgrades

The rating upgrades are primarily attributed to GK Energy's exceptional revenue growth and improved profitability metrics. The company achieved remarkable revenue growth of 166% year-on-year, reaching ₹1,094.83 crores in FY25, driven by timely execution of solar pump installations with steady government allocations.

During H1 FY26, the company maintained strong momentum with revenue of ₹653 crores compared to ₹421 crores in H1 FY25, while EBITDA margins further improved to 19.63%.

Robust Order Book and Market Position

GK Energy maintains a strong market position with a substantial order book of ₹863.98 crores as of September 30, 2025, representing 0.79 times of FY25 revenue. The order book composition demonstrates geographic diversification:

• Maharashtra: ₹853 crores
• Haryana and Madhya Pradesh: Remaining portion

The company derives majority revenue from solar pump installations under the PM-KUSUM Scheme funded by the central government. GK Energy has secured supply of domestically manufactured solar cells sufficient to meet requirements through March 2027, ensuring assured raw material availability.

Enhanced Capital Structure and Liquidity

The company's financial risk profile has strengthened significantly following strategic capital initiatives. Fresh equity infusion of ₹19.30 crores by promoters during FY25 improved the capital structure, with adjusted gearing and TOL/ATNW ratios at 0.97x and 1.70x respectively as of March 31, 2025.

The September 2025 IPO, comprising fresh issue of ₹400 crores and offer for sale of ₹64.26 crores, along with pre-IPO rounds of ₹100 crores, substantially enhanced the company's financial flexibility with ₹300 crores of unutilized IPO proceeds available for working capital requirements.

Key Rating Strengths and Risk Factors

Infomerics highlighted several key strengths supporting the rating upgrade:

• Strong execution capabilities with experienced promoters and long track record since 2008
• Comfortable debt protection metrics with interest coverage ratio of 8.97x as of March 31, 2025
• Government sector focus providing revenue stability through PM-KUSUM scheme participation
• Operational leverage benefits from bulk procurement enabling substantial cost reductions

However, the rating agency noted certain risk factors including working capital intensive operations with collection days of 86 in FY25, though improved from 117 days in FY24. The tender-based nature of operations and competition from organized and unorganized players remain ongoing challenges, partially mitigated by the company's strong market position in the solar pumps segment.

GK Energy Limited has received a Letter of Empanelment/Letter of Award from Maharashtra State Electricity Distribution Company Limited for the supply and installation of solar pump systems. The project represents a significant milestone for the infrastructure developer as it expands its renewable energy portfolio under the government's flagship solar energy initiative.

Project Specifications

The approved project encompasses comprehensive solar energy infrastructure designed to support agricultural operations across Maharashtra under the Magel Tyala Saur Krushi Pump Yojana/PM Kusum B Scheme. The scope includes design, manufacture, supply, transport, installation, testing and commissioning services.

Implementation Timeline

The project comes with an aggressive implementation schedule, requiring GK Energy Limited to complete the installation of all 13,239 systems within 60 days from the issuance of work order/Notice to Proceed (NTP) from the circle office. This timeline reflects the urgency of Maharashtra's renewable energy initiatives and the state's commitment to supporting agricultural communities with sustainable power solutions.

The off-grid DC solar photovoltaic water pumping systems are designed to provide reliable water pumping solutions for agricultural applications, reducing dependence on conventional electricity sources. These systems will enable farmers across Maharashtra to access consistent water supply for irrigation while contributing to the state's renewable energy targets.

Regulatory Compliance

The company has made the disclosure under Regulation 30 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The contract has been awarded by a domestic entity, and the company has confirmed that promoters/promoter group/group companies have no interest in the awarding entity. The transaction does not fall within related party transactions.

Business Impact

This contract represents a substantial addition to GK Energy Limited's order book, with the ₹366.63 crore value demonstrating the company's capability to secure large-scale infrastructure projects. The project aligns with the company's focus on infrastructure development and renewable energy solutions, particularly in the solar energy segment. The successful execution of this project will establish GK Energy Limited's credentials in Maharashtra's renewable energy sector and potentially open doors for additional contracts with state electricity distribution companies across India.