Credit Rating

EVEREST KANTO September 29, 2026 CYLINDER BSE Limited National Stock Exchange of India Limited LIMITED Department of Corporate Services Listing Department Phiroze Jeejeebhoy Towers Exchange Plaza Manufacturers Dalal Street Bandra-Kurla Complex ofHighPressure Mumbai 400 001 Bandra (East), Mumbai 400 051 Seamless Scrip Code: 532684 NSE Symbol: EKC GasCylinders NSE Series: EQ RegisteredOffice: Dear Sir, 204,RahejaCentre, FreePressJournalMarg, 214,NarimanPoint, Sub: Intimation of Reaffirmation of Ratings under the SEBI (Listing Obligations Mumbai-400021. and Disclosure Requirements), Regulations, 2015. CINL29200MH1978PLC02O434 ----------------------------------------------------------------------------------------------- Tel.:+912249268300101 Pursuant to Regulation 30 read with Para A of Part A of Schedule III of the SEBI Fax:+912222870720 (Listing Obligations and Disclosure Requirements), Regulations, 2015, as Website:www.everestkanto.com amended, we wish to inform that CARE Ratings Limited vide its Press Release dated September 28, 2026 has reaffirmed its ratings for the Company as under: Sr. Credit Rating Facilities/ Existing Revised Credit no Agency Instruments Credit Rating Rating 1. Long-term CARE A-; Reaffirmed bank facilities Stable Care Ratings Limited 2. Short-term CARE A2+ Reaffirmed bank facilities The press release along with Rationale as downloaded from the website of CARE Ratings Limited is enclosed for your information and records. Thanking you, ISOITS16941 Yours faithfully, BUREAUVFRITAS For Everest Kanto Cylinder Limited CcnihcatMM Vishal Totla Company Secretary and Compliance Officer Encl. LareEdge Press Release RATINGS Everest Kanto Cylinder Limited September 28, 2026 Facilities/Instruments Name of the Regulator1 Amount (₹ crore) Rating2 Rating Action 156.84 Long-term bank facilities RBI CARE A-; Stable Reaffirmed (Reduced from 164.00) Short-term bank facilities RBI 63.00 CARE A2+ Reaffirmed Details of instruments/facilities in Annexure-1. Rationale and key rating drivers Reaffirmation of ratings to bank facilities of Everest Kanto Cylinder Limited (EKCL) factors in its stable performance in FY26 (refers to April 01 to March 31), marked by stable total operating income (TOI) and improved profitability despite muted performance of its overseas operations. The West Asia conflict adversely affected domestic and international operations owing to supply-chain disruptions, logistical challenges in overseas operations, and higher freight costs, which was reflected in moderation in performance in Q1FY27 (refers to April 01 to June 30). EKCL has undertaken strategic capacity expansion initiatives across India, Egypt and the United States (US). Timely completion of these projects and ramp up of operations will remain a key rating monitorable. CARE Ratings Limited (CareEdge Ratings) takes note of the management’s expectation that sizeable GST-related contingent liabilities will be resolved in the near term. Nevertheless, the outcome of these matters remains a key rating monitorable. Ratings continue to derive strength from EKCL’s long-standing position as one of the leading domestic manufacturers of high- pressure seamless steel gas cylinders, a diversified and reputed customer profile spanning automobile original equipment manufacturers (OEMs), city gas distribution (CGD) entities, and industrial-gas end-users, and high entry barriers in the segment arising from stringent regulatory clearances. Ratings further factor in EKCL’s comfortable capital structure and debt coverage indicators and adequate liquidity position. However, rating strengths continue to remain tempered by fluctuating profitability that is susceptible to raw material price and foreign-exchange volatility and working capital intensive operations. Ratings are further constrained by project execution and stabilisation risk associated with ongoing debt-funded capital expenditures (capex) in India, Egypt and the US and high-cost foreign-currency denominated debt taken to part-fund the project in Egypt. Rating sensitivities: Factors likely to lead to rating actions Positive factors • Improvement in TOI above ₹2,000 crore with profit before interest, lease rentals, depreciation, and taxation (PBILDT) margin at existing levels on a sustained basis. • Improvement in working capital cycle below 150 days on a sustained basis. Negative factors • Significant decline in TOI with PBILDT margin below 10% on a sustained basis. • Deterioration in total debt (TD)/ PBILDT above 2.25x on a sustained basis. • Delay in realisation of envisaged benefits from the ongoing capex, impacting its financial performance. Analytical approach: Consolidated CareEdge Ratings has considered consolidated financials of EKCL. The consolidated approach factors in significant management, operational and financial linkages between EKCL and its subsidiaries and step-down subsidiaries. Subsidiaries consolidated are listed under Annexure-5. Outlook: Stable ‘Stable’ outlook reflects CareEdge Ratings’ expectation that EKCL will continue to benefit from its established presence in the high- pressure seamless steel cylinder industry supported by its reputed clientele, while maintaining its adequate liquidity position. 1SEBI: Securities and Exchange Board of India; RBI: Reserve Bank of India; MCA: Ministry of Corporate Affairs; IRDAI: Insurance Regulatory and Development Authority of India; PFRDA: Pension Fund Regulatory and Development Authority 2Complete definitions of the ratings assigned are available at www.careratings.com and in other CARE Ratings Limited’s publications. 1 CARE Ratings Ltd. CareEdge Press Release RATINGS Detailed description of key rating drivers Key strengths Steady scale of operations amidst global disruptions Consolidated TOI remained broadly stable at ₹1,470.57 crore in FY26 compared to ₹1,499.21 crore in FY25. In March 2026, operations of the overseas subsidiaries were impacted by logistics-related constraints; while production continued, dispatches were deferred due to limited logistics availability and higher freight charges. Nevertheless, unit volumes increased by ~3% year- on-year. In Q1FY27, TOI stood at ₹346.31 crore, moderating by 10.50% year-on-year amid muted overseas performance and global supply chain disruptions. Government’s measures to moderate gas prices, and regulatory support for widening the compressed natural gas (CNG) distribution network, are likely to drive demand for CNG in the near-to-medium term. In addition, EKCL’s ongoing capex initiatives are expected to increase capacity and support EKCL’s performance in the medium term. Comfortable solvency position EKCL's debt profile mainly comprises working capital borrowings, term loans, and lease liabilities. As on March 31, 2026, the capital structure continued to remain comfortable with an overall gearing of 0.19x (FY25: 0.14x) despite the addition of term- loan drawdowns for the Mundra and Egypt capex and higher working-capital utilisation. Tangible net worth improved to ₹1,399.20 crore as on March 31, 2026 (FY25: ₹1,205.82 crore) considering retained earnings accretion and foreign-currency translation gains. Debt coverage indicators though moderated in the last two fiscals, remain comfortable, with TD/PBILDT of 1.29x and interest coverage of 12.11x in FY26 (PY: 0.95x and 10.81x respectively) and are expected to remain at comfortable levels notwithstanding ongoing debt drawdown. CareEdge Ratings takes note of the management’s expectation that the sizeable GST-related contingent liabilities will be resolved in the near term. Nevertheless, the outcome of these matters remains a key rating monitorable. Established market position and experienced promoters EKCL is one of the leading players in the domestic market with a healthy market share and well-established relationships with reputed industry players. With over four decades of operations in the high-pressure seamless steel cylinder industry, EKCL has developed long-standing r [Showing first 8,000 characters — download PDF for full document]