Vishnu prakash r punglia Limited has received a disclosure from promoter Vijay Punglia regarding changes in share encumbrances under Regulation 31 of SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 2011. The disclosure, dated February 28, 2026, reveals both release and creation of pledges on the promoter's shareholding.

Share Pledge Release

Vijay Punglia has released a pledge on 420,000 shares of the company, representing 3.37% of the total share capital. The pledge release was executed on February 24, 2026, providing relief from previous encumbrances on the promoter's holdings.

New Encumbrance Creation

Simultaneously, the promoter has created new pledges with two entities to generate liquidity for intended fund infusion into the company:

Promoter Shareholding Details

Vijay Punglia maintains his total shareholding position in the company as follows:

Regulatory Compliance

The disclosure has been filed with both NSE and BSE, where the company's shares are listed. The document was signed by the authorized signatory from Jodhpur on February 28, 2026, ensuring compliance with SEBI regulations for substantial shareholding disclosures.

The restructuring of pledges indicates the promoter's strategic approach to optimize encumbrances while maintaining liquidity options for potential capital infusion into the company's operations.

Vishnu Prakash R Punglia Limited has received a credit rating downgrade from CARE Ratings Limited, with its bank facilities being revised from CARE BBB- Stable to CARE BB+ Negative. The rating action affects facilities totaling ₹960.00 crore and reflects concerns over the company's deteriorating financial performance and stretched liquidity position.

Rating Revision Details

CARE Ratings Limited has downgraded VPRPL's credit ratings across its banking facilities, citing significant operational challenges and financial performance deterioration during the nine-month period ended December 31, 2025.

The outlook has been revised from 'Stable' to 'Negative', indicating CARE Ratings' expectation of continued subdued performance in the near term due to high working capital intensity and potential further impact on debt coverage indicators.

Financial Performance Deterioration

VPRPL's operational performance has shown significant decline during 9MFY26, with the company reporting substantial moderation in scale and profitability. The engineering, procurement and construction (EPC) revenue declined to ₹749.57 crore in 9MFY26 from ₹832.36 crore in 9MFY25.

The company reported an operating loss in Q3FY26 due to lower absorption of fixed costs, subdued gross margin, and provisioning for expected credit loss of ₹17.00 crore. This resulted in a cash loss of ₹31.00 crore in Q3FY26, significantly impacting liquidity.

Working Capital and Liquidity Challenges

Working capital intensity continues to be a major concern for VPRPL, with the construction segment's inherent capital requirements being exacerbated by delays in work certification and payment releases from government authorities. The company's working capital cycle has elongated significantly:

• Gross Current Assets (GCA) days: 510 days in FY25 vs 204 days in FY23
• Working Capital Cycle: 323 days in FY25 vs 104 days in FY23
• Fund-based limits utilization: Over 90% in 12-months ended December 2025
• Non-fund-based limits utilization: 71% as on January 15, 2026

The company faces monthly scheduled repayments of ₹5.00 crore against the backdrop of operating losses, resulting in stretched liquidity conditions.

Orderbook Strength and Business Diversification

Despite operational challenges, VPRPL maintains a robust orderbook position that provides medium-term revenue visibility. The company had an outstanding orderbook of ₹5,000.00 crore as of September 30, 2025, representing healthy revenue visibility of 4x FY25 total operating income.

Geographic Distribution:

• Rajasthan: 48%
• Uttarakhand: 16%
• Uttar Pradesh: 9%
• Madhya Pradesh: 7%
• Other states: 20%

The majority of orders are from government entities with low counterparty credit risk, though timely fund allocation and release remain crucial for project execution.

Key Rating Concerns and Outlook

The rating agency has highlighted several factors constraining VPRPL's credit profile, including execution risks associated with projects at nascent stages and the company's presence in a highly competitive construction industry. Approximately 15% of the orderbook pertains to recently awarded projects at early execution stages, while another 23% comprises slow-moving orders due to land unavailability and design finalization delays.

Additional concerns include the termination of a railway contract worth ₹160.00 crore, resulting in forfeiture of bank guarantee and security deposit of ₹8.87 crore, with the company booking a loss of ₹9.96 crore in Q3FY26. The matter is currently sub-judice under the High Court.

The negative outlook reflects expectations of continued subdued performance due to high working capital intensity, which may further impact debt coverage indicators and liquidity profile in the near term.

Source: None/Company/INE0AE001013/05502eaa-b5df-4abb-8c31-d99fee8ef2d2.pdf