Credit Rating

October 07, 2026 National Stock Exchange of India Limited BSE Limited "Exchange Plaza" Phiroze Jeejeebhoy Towers Bandra-Kurla Complex, Bandra (East) Dalal Street Mumbai – 400051 Mumbai - 400001 Scrip Symbol: IRMENERGY Scrip Code: 544004 Sub: Intimation under Regulation 30 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 – Credit Rating Dear Sir/Madam, Pursuant to Regulation 30 read with Schedule III of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, we wish to inform you that India Ratings and Research Private Limited (“India Ratings”) has affirmed the credit rating to the bank loan facilities of the Company. In this regard, please find below the details of the credit rating by India Ratings to the bank loan facilities of the Company: Aggregate Loan Instrument Type Rating Rating Action amount (INR million) Bank Loan facilities 7000 IND AA- / Stable / IND A1+ Affirmed The rating rationale issued by India Ratings dated October 07, 2026 is enclosed herewith. Request to kindly take the above information on record. Thanking you, Yours sincerely, For, IRM Energy Limited Akshit Soni Company Secretary & Compliance Office India Ratings Affirms IRM Energy’s Bank Loans at ‘IND AA-’/Stable Oct 07, 2026 | IRM Energy Limited(Formerly IRM Energy Private Limited) | Gas Transmission/Marketing India Ratings and Research (Ind-Ra) has affirmed IRM Energy Limited’s (IRM) bank loan ratings as follows: Details of Instruments Size of Rating Assigned Regulator of Date of Coupon Maturity Rating Instrument Type Issue (INR with Instrument Issuance Rate Date Action million) Outlook/Watch Bank loan RBI - - - 7,000 AA-/Stable/IND Affirmed facilities Analytical Approach Ind-Ra continues to take a standalone view of IRM to arrive at the ratings while factoring in the corporate guarantees provided to its joint ventures (JVs). Detailed Rationale of the Rating Action The affirmation reflects IRM’s healthy financial profile and improving business profile, supported by the continued expansion of infrastructure in its existing geographical areas (GAs), especially Banaskantha and Namakkal & Tiruchirappalli (NT), along with sustained ramp-up in volumes led by favourable demand. The ratings also factor in the company’s ability to mitigate a lower administered price mechanism (APM) gas allocation for the compressed natural gas (CNG) segment through high pressure high temperature (HPHT) gas tie-ups and regasified liquefied natural gas (RLNG) sourcing arrangements, while maintaining competitive CNG retail pricing. The industrial volumes in the Fatehgarh Sahib (FS) GA moderated after the relaxation of NGT-related norms, resulting in lower volumes from the GA; however, the management has explained that a substantial portion of the FY26 volumes comprised sticky consumers/demand. Furthermore, this moderation was partly offset by healthy growth in the CNG volumes, driven by the ramp-up of operations in the NT GA and increased domestic PNG penetration across its operating areas. Consequently, the company’s overall sales volumes improved to around 0.61mmscmd in FY26 and to about 0.65mmscmd in 1QFY27. The ratings are further supported by IRM’s strong credit profile, with the company maintaining a net cash position and comfortable debt metrics at end-March 2026. Ind-Ra expects the company to generate adequate internal accruals to fund its planned capex programme in the NT GA and other operating areas, with only a limited reliance on external debt. The timely ramp-up of the newly added infrastructure, commensurate growth in volumes and EBITDA, and the company’s ability to sustain profitability amid evolving gas sourcing dynamics are key monitorables. List of Key Rating Drivers Strengths Healthy credit metrics Continued volume growth in FY26 and 1QFY27, driven by CNG segment; subdued industrial demand Profitability improved in FY26 and 1QFY27, led by higher gross margins Weaknesses Large capex plans, but debt reliance to remain limited Risk related to breach of minimum work programme (MWP) targets Gas sourcing to remain a key determinant to sustain profitability Expiry of marketing exclusivity in two GAs Detailed Description of Key Rating Drivers Healthy Credit Metrics: IRM’s net leverage (net debt including corporate guarantees issued/EBITDA) was negative 0.56x at FYE26 (FYE25: negative 0.86x; FYE24: negative 1.09x) given the high cash balance. The interest coverage (operating EBITDA/interest expense) improved to 7.61x in FY26 (FY25: 4.36x; FY24: 5.58x). The gross debt reduced to INR1,222.8 million at FYE26 (FYE25: INR1,898.3 million; FYE24: INR2,887.5 million), comprising term loans of INR496.25 million (INR1,250.7 million; INR1,773.0 million), nil short-term borrowings (nil; INR99.9 million), and lease liabilities of INR235.23 (INR160.2 million; INR189.3 million), with the balance INR491.3 million corporate guarantees provided to its JV Venuka Polymers Private Limited. The initial public offering (IPO) proceeds of INR1,587.2 million were unutilised as of end-June 2026, which will likely be used to fund the upcoming capex. Ind-Ra expects the net leverage to turn positive in FY27, led by sustained capex run-rate and repayments of existing debt, but to remain comfortably below 0.5x. Ind-Ra expects IRM to use the IPO proceeds and cash accruals for the capex plans, with limited reliance on external debt. This is likely to lead to robust credit metrices, along with a higher gross fixed assets and EBITDA base, over the medium term. Continued Volume Growth in FY26 and 1QFY27, Driven by CNG Segment; Subdued Industrial Demand : IRM’s sales volumes improved to 58.9mmscm (0.65mmscmd) in 1QFY27 (FY26: 223.7mmscm/0.61mmscmd; FY25: 208.4mmscm/0.57mmscmd). The average net realisation increased to INR55.3/scm in 1QFY27 (FY26: INR47.7/scm; FY25: INR46.8/scm), supported by price hikes during the quarter, resulting in a revenue (net of excise duty) of INR3,258.5 million (INR10,666.6 million; INR9,754.8 million). The overall volume growth continued to be gradual in FY26 and 1QFY27, largely driven by the CNG segment, while the recovery in piped natural gas-industrial (I-PNG) volumes was subdued in the FS GA. The I-PNG volumes in FS declined to 181 thousand scmd in 1QFY27 (FY26: 206 thousand scmd; FY25: 226 thousand scmd), owing to the relaxation in NGT-related norms for industrial fuel usage and a reduction in domestic gas allocation to industrial consumers amid supply disruptions caused by the Middle East conflict in March 2026. However, the moderation in industrial volumes was offset by continued growth in CNG sales to 39.3mmscm in 1QFY27 (FY26: 133.5mmscm; FY25: 110.4mmscm), supported by the expansion of the CNG station network to around 153 stations as of June 2026 (March 2026: 150 stations). Consequently, the CNG segment’s share in the company’s overall sales volume increased to 67% in 1QFY27 (FY26: 59.7%; FY25: 53.0%), while the I-PNG segment’s contribution declined to 28% (34.9%; 40.9%). The sales volume contribution from the Banaskantha, FS, Diu & Gir Somnath (DGS), and NT GAs was 47%, 39%, 8%, and 6%, respectively, in FY26. Ind-Ra expects medium-term volume growth to be supported by the CNG segment and the gradual ramp-up of the NT GA, aided by the company’s ongoing capex towards expanding its infrastructure network across all four GAs. However, given the continued exposure to industrial consumers, volume growth would remain sensitive to regulatory developments in the FS GA, domestic gas allocation to non-priority sectors, and changes in natural gas prices, which are key monitorables. Profitability Improved in FY26 and 1QFY27, Led by Higher Gross Margins: IRM’s EBITDA improved to INR617.8 million in 1QFY27 (FY26: INR1,122.1 million; FY25: INR963.3 million), with the EBITDA margin increasing to 19.0% (10.5%; 9.9%). The improvement was supported by an increase in the gross margins, leading to a rise in EBITDA/scm to INR10.5/scm in 1QFY27 (FY26: INR5.02/scm; [Showing first 8,000 characters — download PDF for full document]