Dharan Infra-EPC Limited — financial distress indicators
Financial-health summary
Dharan Infra-EPC Limited's reported numbers place it in the 'Weak' financial-health band (distress score 50/100). The main indicators are market-implied default probability >20%, massive shareholder dilution and steep revenue decline. Independently, the Ohlson accounting model puts its 1-year failure probability at 10% and the market-implied (Merton) default probability is 42.4%. In its favour: cash on hand covers all debt (net-cash balance sheet).
Stress by dimension
Share price — last 12 months
Indicators behind the score
Each red flag shows the evidence from the company’s own filings and the financial or legal principle behind it. Points add to the 0–100 score.
Merton distance-to-default 0.19 σ → PD 42%.
Structural (Merton/KMV) model: equity is a call option on assets; low distance-to-default means assets are close to the default point.
Share count up +138% in a year.
Survival financing: repeated equity raises at depressed prices.
Revenue changed -20% year over year.
Falling sales reduce cash available for debt service.
Net income negative in 3 of 3 fiscal years. Partly offset by positive operating cash flow and net cash.
Persistent losses erode equity and the capacity to absorb shocks.
Price is -77% from its 52-week high.
For financial firms a share-price run often precedes a deposit or funding run (confidence channel).
Operating margin fell from -0% to -210% in two years.
Sharp margin compression signals loss of pricing power or cost control.
Revenue vs net income
Cash generation
Debt vs cash vs equity
✅ Mitigating factors
- Cash on hand covers all debt (net-cash balance sheet).
- Operating cash flow is positive over the latest 12 months.
- Strong current ratio (8.29).
📰 Recent news scan
- Dharan Infra-EPC Ltd. Key Financial Ratios – Valuation, Profitability & More - Value ResearchGoogle News · 2026-08-30
- DHARAN INFRA-EPC Share Price Forecast: 3 Year Outlook to 2030 - UnivestGoogle News · 2026-07-16
- Dharan Infra-EPC promoters confirm no encumbrance on shares in FY26 - scanx.tradeGoogle News · 2026-07-14
⚖️ Indian legal pathway — the IBC, 2016
How insolvency starts
- A financial creditor (§7), an operational creditor after a demand notice (§§8–9) or the company itself (§10) can apply to the NCLT once a default of at least ₹1 crore occurs (§4).
- On admission a moratorium (§14) stops suits and recovery; the board is suspended and an insolvency professional runs the company.
- The Committee of Creditors approves a resolution plan with 66% of voting share (§30(4)) within an outer limit of 330 days (§12); otherwise liquidation (§33) under the §53 waterfall — equity ranks last. Defaulting promoters are generally barred from bidding (§29A).
Earlier warning stages
- RBI's Prudential Framework for Resolution of Stressed Assets (7 June 2019): lenders must review a borrower within 30 days of default and implement a resolution plan, or provide more.
- Listed companies must disclose loan defaults to exchanges under SEBI (LODR); a rating downgrade to “D” is a public signal.
- Auditors must report going-concern uncertainty (SA 570 / Ind AS 1).
Frequently asked questions
What do Dharan Infra-EPC Limited's financial-health indicators show?
As of 2026-10-09, Dharan Infra-EPC Limited's public financial data places it in the 'Weak' band with a distress score of 50/100, driven by market-implied default probability >20%, massive shareholder dilution and steep revenue decline. This is a statistical screen of reported numbers — it does not mean the company is insolvent, has defaulted or will enter insolvency proceedings.
What is Dharan Infra-EPC Limited's financial distress score?
50/100 ('Weak'). Ohlson O-score -2.2 (model 1-year failure probability 10%). Merton distance-to-default 0.19 σ (model default probability 42.4%).
What works in Dharan Infra-EPC Limited's favour?
Cash on hand covers all debt (net-cash balance sheet). Operating cash flow is positive over the latest 12 months. Strong current ratio (8.29).
How are shareholders treated if a company enters insolvency?
Under the IBC the Committee of Creditors controls the resolution; the §53 waterfall pays secured creditors and workers first and equity last. In most resolution plans existing shareholders are wiped out or left with a token stake, and the company may be delisted.
Other Real Estate Cos & REITs companies with distress indicators
- Emami Realty Limited (EMAMIREAL)Very weak 100/100
- Eurotex Industries and Exports Limited (EUROTEXIND)Very weak 100/100
- Parsvnath Developers Limited (PARSVNATH)Very weak 100/100
- Unitech Limited (UNITECH)Very weak 100/100
- Housing Development and Infrastructure Limited (HDIL)Very weak 87/100
- Peninsula Land Limited (PENINLAND)Very weak 81/100
All Real Estate Cos & REITs companies with distress indicators →
Methodology
Score = capped sum of rule-based red flags across seven dimensions (liquidity, solvency, profitability, cash flow, sales trend, market signal, news). Ohlson O-score (1980) gives an accounting-based 1-year failure probability; Merton distance-to-default (Bharath & Shumway 2008) gives a market-implied probability. Financial institutions use a capital-based rule set. Recalculated every trading day from the latest filings, prices and news.