The agency has revised its outlook on the company's long-term rating to ‘positive' from ‘stable' while the reaffirming the rating on the same at ‘CARE A'.

CARE Ratings said that the upgradation of the short-term rating to ‘CARE A1' assigned to the short-term bank facilities of Man Infraconstruction Limited is on account of the sustenance of strong liquidity profile by the company in FY23 as well as Q1 FY24.

The free cash and bank balance as on 30 June 2023 stood at Rs 526 crore ( for March 23: Rs 241.56 crore and March 22: Rs 355.51 crore). The company continued to maintain strong liquidity despite having multiple large-scale projects under execution.

The reaffirmation of the long-term rating assigned to the long-term bank facilities of Man Infraconstruction Limited (MIL) reflects steady improvement in the operational metrics of real estate segment which remained in line with the expectation of CARE Ratings.

MIL has shown a continuous improvement in project progress and has reported healthy sales velocity in all its ongoing projects along with steady flow of customer advances which negates any risk of the project's saleability and completion.

The ratings continue to derive strength from the long track record and extensive experience of the promoters in the real estate sector, diversified portfolio of the ongoing projects, healthy order book position for the engineering, procurement & construction (EPC) segment and strong liquidity.

The ratings are constrained by the upcoming three high-ticket projects from FY24 onwards wherein achieving steady flow of customer advances along with achieving the envisaged construction timelines are yet to be established.

Moreover, the ratings continue to factor in investment in USA-based subsidiary amounting to 21% of the net worth of the company, geographical and segmental concentration risk of its revenue profile, exposure to group entities and presence in the inherently cyclical real estate industry.

Man Infraconstruction is a real estate developer, operating under its own brand name in the residential segment. The company through its subsidiaries/associates enters into joint development agreement with landowner(s)/tenant(s) for developing real estate projects in MMR. Till date MIL has completed 13 projects having real estate regulatory authority (RERA) carpet area of around 15 lakh square feet (lsf) under its group.

The company had reported a net profit of Rs 82 crore in Q1 FY24, which is higher by 112% as compared with Rs 39 crore in Q1 FY23. Revenue increased by 45% YoY to Rs 510 crore in the first quarter of FY24.

The scrip rose 0.85% to currently trade at Rs 154.75 on the BSE.