SEPC Limited has disclosed significant credit rating downgrades from two prominent rating agencies, marking a substantial deterioration in its credit profile. The company informed stock exchanges on March 10, 2026, about the downgrades received from CRISIL Ratings Limited and Infomerics Valuation and Rating Ltd.

Credit Rating Downgrades

The rating actions represent a sharp decline in the company's creditworthiness across both long-term and short-term facilities. Both agencies have moved the ratings to the 'D' category, which typically indicates default or expected default on financial obligations.

CRISIL Rating Rationale

CRISIL Ratings downgraded SEPC's bank facilities totaling ₹890.15 crore due to delayed interest payment obligations. The company failed to service approximately ₹6 crore of term loan interest due on February 28, 2026. Additionally, there have been delays exceeding 30 days in clearing letter of credit dues and overdrawals in cash credit accounts.

The rating agency noted that the Madras High Court ordered attachment of ₹154 crore of SEPC's receivables on February 19, 2026, in connection with ongoing legal proceedings involving Twarit Consultancy Services Pvt Ltd and GPE entities. This led to lenders freezing the trust and retention account, exacerbating liquidity mismatches.

Infomerics Rating Action

Infomerics Valuation and Rating Ltd downgraded facilities worth ₹882.50 crore across various categories. The rating committee reviewed and downgraded both long-term and short-term bank facilities to IVR D from their previous ratings.

Financial Performance Context

Despite operational challenges, SEPC reported improved financial performance in recent months. For the first nine months of fiscal 2026, the company achieved net profit of ₹40 crore on operating income of ₹781 crore, compared to ₹15 crore profit on ₹485 crore revenue in the corresponding previous period.

Regulatory Compliance

The disclosure was made pursuant to Regulation 30 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. Company Secretary and Compliance Officer T Sriraman signed the communication digitally on March 17, 2026, ensuring compliance with regulatory requirements for material information disclosure to both NSE and BSE.

SEPC Limited has successfully concluded its postal ballot process, with shareholders approving the variation in Rights Issue proceeds utilization with an overwhelming majority. The company announced the results on March 09, 2026, following the completion of e-voting on March 07, 2026.

Approved Allocation of Rights Issue Proceeds

The shareholders approved the reallocation of Rights Issue proceeds as outlined in the Letter of Offer dated May 22, 2025. The approved utilization structure demonstrates the company's strategic focus on debt management and operational expansion.

Voting Results and Shareholder Participation

The postal ballot witnessed strong shareholder participation, with the special resolution receiving substantial support across all categories of shareholders. The e-voting process was conducted through Central Depository Services (India) Limited (CDSL) platform.

Category-wise Voting Breakdown

The voting results showed unanimous support from promoter and promoter group, while public shareholders also demonstrated strong approval:

• Promoter and Promoter Group: 515607054 votes (100% in favor)
• Public Institutions: 4592557 votes (100% in favor)
• Public Non-Institutions: 3736627 votes (80.03% in favor, 19.97% against)

Regulatory Compliance and Process

The postal ballot was conducted in strict adherence to regulatory requirements under Section 108 and 110 of the Companies Act, 2013, and Regulation 44 of SEBI LODR Regulations. D. Saravanan, Practicing Company Secretary from Alagar & Associates LLP, served as the scrutinizer to ensure fair and transparent voting.

The company dispatched the postal ballot notice via email on February 05, 2026, to members whose names appeared on the register as of the cut-off date of January 30, 2026. Public advertisements were published in Business Standard (English) and Makkal Kural (Tamil) on February 06, 2026, ensuring wide dissemination of information.

Strategic Implications

The approved variation reflects SEPC Limited's balanced approach toward financial management, combining debt reduction with growth-oriented working capital enhancement. The substantial allocation of Rs. 124.20 crores toward working capital requirements indicates the company's focus on operational expansion and meeting incremental business demands, while the Rs. 15.80 crores earmarked for NCD repayment demonstrates commitment to debt servicing obligations.