India Ratings Downgrades DCAL's Debt to 'IND A'/Negative; Assigns Rating to New NCDs
India Ratings downgraded Dishman Carbogen Amcis Limited's (DCAL) debt instruments to 'IND A'/Negative, citing consistently high leverage. Proposed NCDs are rated 'IND A'/Negative. The company plans to raise ₹10 billion via QIP or preferential shares to reduce debt. EBITDA margins remain below pre-EDQM levels, though expected to improve to 19-20% in FY26.
A downgrade in credit rating and a negative outlook can significantly impact a company's borrowing costs, investor confidence, and access to future financing, making it a high-impact event.
The credit rating has been downgraded to 'IND A' with a 'Negative' outlook due to high leverage and lower-than-expected EBITDA margins, indicating financial strain.
India Ratings & Research Pvt. Ltd. (Ind-Ra) has downgraded the credit rating for Dishman Carbogen Amcis Limited's (DCAL) non-convertible debentures (NCDs) and long-term bank facilities to 'IND A' with a 'Negative' outlook. The rating for proposed NCDs has been assigned at 'IND A' with a 'Negative' outlook. The rating for principal protected market-linked debentures has been withdrawn due to full repayment.
The downgrade and negative outlook are primarily due to DCAL's consistently high net adjusted leverage, which improved to 3.92x in FY25 from 6.35x in FY24 but is expected to remain elevated in FY26. At the standalone level, FY25 saw a net adjusted leverage of 9.94x and a gross adjusted interest coverage of 0.96x, supported by dividend income, interest received, and debt refinancing.
EBITDA margins have been lower than the pre-EDQM period, standing at 15.7% in 3QFY26 (9MFY26: 19.35%, FY25: 17.3%). This is attributed to a slower-than-expected ramp-up in the CRAMS business on a standalone basis and the commencement of commercial operations at the new French facility. While the EU business has performed steadily, the India business's performance and delays in the French operations have led to higher-than-anticipated net leverage.
The company plans to raise approximately ₹10 billion through a Qualified Institutional Placement (QIP) or preferential shares to repay high-cost debt and reduce net adjusted leverage to below 2.5x. DCAL's working capital cycle remains stretched, extending to 180 days in FY25 due to high inventory and an increased receivable period. However, the company has seen a significant increase in short-term customer advances. Maintenance capex is expected to be largely funded through internal accruals.
Consolidated revenue grew by 4.3% year-on-year to ₹20,805 million during 9MFY26. The management expects EBITDA margins to improve to 19%-20% for FY26 and further in FY27, supported by the ramp-up of operations at the Bavla and French facilities. The company has also refinanced a foreign currency loan of CHF150 million in November 2025 for six years.
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Dishman Carbogen Amcis Limited filed this with the NSE as a statutory disclosure, categorised under credit ratings. It is a primary document, not a recommendation, and the desk marks it high impact, which is the band that most often changes something.
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See the model portfoliosA plain-language summary of a public exchange filing by Dishman Carbogen Amcis Limited. Read the original for the full detail.