Hindustan Construction Company Limited (HCC) has announced the reaffirmation of its credit ratings for various bank facilities and non-convertible debentures by CARE Ratings Limited. The long-term bank facilities and non-convertible debentures have been reaffirmed at CARE BBB-; Stable, while long-term/short-term bank facilities are rated CARE BBB-; Stable / CARE A3. This reaffirmation factors in the improvement in HCC's financial risk profile, driven by successful capital raising of ₹1,000 crore via a Rights Issue in December 2025 and recovery of arbitration proceeds amounting to ₹720 crore in FY26. These funds were utilized for working capital and debt repayment, reducing the company's debt from ₹3,279 crore as of March 31, 2025, to ₹2,016 crore as of March 31, 2026. The ratings also consider the reduction in corporate guarantee extended by HCC to its SPV, Prolific Resolution Private Limited (PRPL), from 100% to 20% of the carved-out debt, limiting HCC's exposure to ₹571 crore. HCC's order book stood at ₹13,148 crore as of December 31, 2025, providing medium-term revenue visibility. While revenue moderated in FY25 and 9MFY26 due to project award delays and early mobilization stages, the company reported improved PBILDT margins. However, the ratings are tempered by slower-than-envisaged recovery from disputed debtors and sizeable arbitration debtors, leading to elevated gross current asset days. The company is expected to resolve arbitration claims aggregating ~₹700 crore – ₹1000 crore in FY27.
