/raid1/www/Hosts/bankrupt/TCRAP

/raid1/www/Hosts/bankrupt/TCRAP_Public/110113.mbx T R O U B L E D C O M P A N Y R E P O R T E R A S I A P A C I F I C Thursday, January 13, 2011, Vol. 14, No. 9 Headlines A U S T R A L I A BLACKWOOD HOSPITAL: Community Continues Fight to Save Hospital RAINE SQUARE: Goes Into Receivership SUNCORP-METWAY LTD: Fitch Affirms Individual Rating at 'B' * AUSTRALIA: BoQ Faces Slower Loan Growth, Defaults Amid Flood C H I N A EVERGRANDE REAL: Fitch Affirms Issuer Default Rating at 'BB' EVERGRANDE REAL: S&P Assigns 'BB-' Rating on Proposed Notes HOPSON DEVELOPMENT: S&P Places 'B' Issue Rating on Unsecured Notes H O N G K O N G AFK HK: Creditors' Proofs of Debt Due January 24 ANALOG EXPRESS: Court Enters Wind-Up Order DAIKIN CHEMICAL: Lai and Hauhey Step Down as Liquidators DAILY FINE: Court to Hear Wind-Up Petition on January 26 DRANSFIELD HOLDINGS: Creditors' Meetings Set for January 18 FAVOUR CENTURY: Court Enters Wind-Up Order FUJIAN SHUNDA: Lui and Leung Step Down as Liquidators FULLBRIGHT COMPANY: Creditors' Proofs of Debt Due February 7 FULL BRILLIANT: Court Enters Wind-Up Order FULLWIN LOGISTICS: Court to Hear Wind-Up Petition on February 23 I N D I A AMARAVTHY SPINNING: Fitch Puts 'B(ind)' Rating on INR38.5MM Loan ANDAMAN SEA: CRISIL Reaffirms 'B-' Rating on Various Bank Debts ANJANAY RICE: CRISIL Assigns 'BB' Rating to INR75.1MM LT Loan BLS ECOTECH: CRISIL Places 'BB-' Rating to INR180MM Long Term Loan FATEH CHAND: Fitch Affirms 'BB+(ind)' National Long-Term Rating MARKETING TIMES: CRISIL Places 'B+' Rating to INR230MM Cash Credit REACH CARGO: CRISIL Reaffirms 'P4+' Rating on INR10 Million LOC SARADA PROJECTS: CRISIL Reaffirms 'BB' Rating on INR50MM LT Loan SHREYANS INDUSTRIES: CRISIL Withdraws 'BB' Rating on Debentures SHRI CHAKRA: CRISIL Downgrades Rating on INR83.2MM Loan to 'D' STAR DRUGS: CRISIL Reaffirms 'D' Ratings on Various Bank Debts SWARNA PROJECTS: CRISIL Assigns 'B' Rating to INR200MM Cash Credit VINAY INDUSTRIES: CARE Assigns 'CARE BB' Rating to INR4.66cr Loan VISHAAL PROMOTERS: CRISIL Assigns 'C' Rating to INR100MM LT Loan WAHI SONS: CRISIL Assigns 'BB' Rating to INR58.2 Million Term Loan I N D O N E S I A PT SULFINDO: Fitch Assigns 'B' Issuer Default Rating J A P A N JAPAN AIRLINES: JAL, AMR to Start Joint Business Venture in April JAPAN AIRLINES: May Seek Tie-Up Ventures With Cathay to Pare Costs T A I W A N AMERICAN INT'L: Ruentex Said to Lead Bidding for Nan Shan - - - - - ================= A U S T R A L I A ================= BLACKWOOD HOSPITAL: Community Continues Fight to Save Hospital -------------------------------------------------------------- Alice Higgins at Hills & Valley Messenger reports that Hills groups are refusing to back down from their fight to save Blackwood Hospital, calling on the State or Federal governments to buy it or inject cash to help it reopen. According to the report, community groups said the State or Federal governments should either pitch in to erase the private hospital's AU$2.3 million debt, or buy the site and make it a public hospital or an arm of Flinders Medical Centre. The hospital, expected to sell for about AU$5 million, closed on Christmas Eve, leaving more than 100 workers without jobs. The Messenger relates Blackwood Action Group chairman and Mitcham Cr Mark Ward said the State Government had an "obligation' to buy the hospital. "It is the cheapest option to secure the health of people in this state, not just the Hills area,' Mr. Ward said, according to the Messenger. "The health system is under-resourced and over- burdened and an ageing population is only going to add more pressure.' Blackwood Belair and District Community Association president Stewart Mitchell said the future of the Laffers Rd hospital, which was placed in voluntary administration last November, was dependent on government support. The Messenger notes Hospital Chief Executive Philip Huestis said it was not the responsibility of governments to save the hospital. "It's (Blackwood) a private, not-for-profit hospital,' the Messenger quoted Mr. Huestis as saying. "Someone would need to inject some capital and pay off some debts (for it to reopen).' PPB consultant Ian Burford said the administrator was expected to put the hospital on the market this month. Blackwood Hospital is a private hospital based in South Australia. RAINE SQUARE: Goes Into Receivership ------------------------------------ James Thomson at Smart Company reports that receivers have been appointed to the Raine Square office/retail tower project, which was being jointly developed by rich list member Luke Saraceni and fellow property developer Hossean Pourzard. The report relates that major lender Bankwest -- which has also signed on as the 20- storey tower's major tenant -- called in receivers Mark Korda and Cliff Rocke of insolvency firm Korda Mentha in conjunction with fellow lender Bank of Scotland. Reports suggest that Mr. Saraceni and Mr. Pourzard's joint venture company, Westgem Investments, missed a AU$50 million payment to their lenders in late 2010, according to Smart Company. Attempts to refinance the project have been unsuccessful, Smart Company notes. Smart Company says that the Raine Square project has a troubled history. The report recounts that Mr. Saraceni and Mr. Pourzard purchased the site in 2004 for AU$21.5 million and began work in 2006. But while the tower was expected to be completed by the end of 2009, a series of problems have beset the project, the report relates. In early 2010, Smart Company discloses, the first construction company engaged on the project, Salta Constructions, abruptly quit the project after a dispute with Westgem. This led to a delay of several months while the two companies fired legal claims at one another, the report relates. Smart Company adds that there are also claims allegations of gang violence associated with the site. Despite all this, Korda Mentha said that the project's current construction company, Probuild, was progressing well, with building expected to be completed by July, the report says. However, Mr. Saraceni has reacted angrily to the appointment of receivers, claiming in The West Australian that Bankwest's parent company, Commonwealth Bank, rejected a number of refinancing deals he had put forward and were determined to "take control of that asset at the cheapest possible price," Smart Company notes. The bank has rejected the accusation. Located in Perth, Australia, Raine Square office/retail tower is a AU$500 million project. SUNCORP-METWAY LTD: Fitch Affirms Individual Rating at 'B' ---------------------------------------------------------- Fitch Ratings affirmed the ratings of Suncorp-Metway Limited, Suncorp Metway Insurance Limited and Vero Insurance Limited, following a restructure of the Suncorp group under a non-operating holding company, Suncorp Group Limited. At the same time, the agency has assigned a Long-term Issuer Default Rating of 'A' and a Short-term IDR of 'F1' to SGL. Following the restructure, SGL is the listed, non-operating parent of the Suncorp group, with three main operating divisions: banking, general and life insurance. SML, the previous listed parent of the group, will be the main operating entity within the banking division, while SMIL and VIL will be the core operating entities in the general insurance division. The restructure, completed on January 7, 2011, is mildly positive from a credit perspective, adding greater transparency to the group and better aligning the legal structure with its existing management framework. Surplus group capital will be held by SGL instead of SML under the new structure. While this will reduce SML's capital base, the bank's capital position will remain adequate. These rating actions reflect the impact of the restructure on the Suncorp entities rated by Fitch. The agency expects to complete its annual review of the Suncorp group by end-Q111, during which it will address broader group issues including the Negative Outlook on the Long-term Issuer Default Rating of SML, and taking into account negative aspects, such as asset quality, that also impact the bank's Individual rating. Although net losses and the impact to profitability from the flooding in Queensland are yet to be determined, Fitch notes that the FY11 natural hazard allowance of AUD460m and the comprehensive catastrophe reinsurance cover provide a solid buffer to earnings and capitalization. More specifically current reinsurance covers restrict the net loss from a single event of up to AUD5.6 billion to AUD200 million, and should a number of large losses occur during the year, the group has AUD400 million in aggregate cover that will respond once a AUD300 million deductible is eroded. SML's ratings reflect the bank's adequate capital position following the restructure and the potential for further capital to flow from the group if required. This is partially offset by poor asset quality and low provisioning levels relative to Australian bank peers. Further significant deterioration in asset quality which erodes the bank's capital base, or a material weakening of the group's insurance operations, could lead to a negative rating action. The ratings of VIL and SMIL reflect their strong business franchises and brands in the Australian general insurance market, their good level of capitalization, and conservative investment and reserving philosophies. The key rating drivers that could result in an upgrade are a clearly demonstrated improvement in group-wide operational performance and risk management. The key rating driver that could result in a downgrade is the potential for contagion from asset quality declines in the group's banking operations that would impact capitalization levels at the group level and also within the general insurance entities. SGL's ratings reflect those of its operational subsidiaries and would be impacted by changes at the operational subsidiary level. The Suncorp group is an Australian financial conglomerate. It is the largest underwriter of general insurance risks in Australia, the second-largest in New Zealand, owns Australia's fifth largest bank with 3% of total system assets, and operates Australia's eighth largest life insurer by premium. The following rating actions have been taken: Suncorp Group Limited (SGL): * Long-term IDR: assigned at 'A'; Outlook Stable; and * Short-term IDR: assigned at 'F1'. Suncorp-Metway Limited (SML): * Long-term IDR: affirmed at 'A+'; Outlook Negative; * Short-term IDR: affirmed at 'F1'; * Individual Rating: affirmed at 'B'; * Support Rating: affirmed at '3'; * Support Rating Floor: affirmed at 'BB+'; * AUD Government Guaranteed Debt: affirmed at 'AAA'; * Non-AUD Government Guaranteed Debt: affirmed at 'AA+'; * Senior Unsecured Debt: affirmed at 'A+'/'F1'; * Commercial Paper: affirmed at 'F1'; and * Subordinated Debt: affirmed at 'A'. Suncorp Metway Insurance Ltd (SMIL): * Insurer Financial Strength: affirmed at 'A+'; Outlook Stable. Vero Insurance Limited (VIL): * Insurer Financial Strength: affirmed at 'A+'; Outlook Stable. * AUSTRALIA: BoQ Faces Slower Loan Growth, Defaults Amid Flood -------------------------------------------------------------- Australian lenders led by Bank of Queensland Ltd. face slower credit growth and increased customer defaults in Queensland after this week's floods in the eastern state, Bloomberg News reports citing Morgan Stanley. Citing a Jan. 11 note by analysts led by Richard Wiles, Bloomberg relates that based on the distribution of branches, Queensland may account for about 60% of profit at Brisbane-based Bank of Queensland. Shares of Bank of Queensland fell in Sydney and insurers including Insurance Australia Group Ltd. dropped on concern damage claims will surge. Brisbane, Australia's third-largest city, is facing its worst floods since 1893 and 40,000 properties may be inundated, the city council estimates. "In the near term, we expect that weaker economic activity will result in higher loan losses and a lower loan growth outlook for Queensland banking operations," Mr. Wiles wrote in his report, according to Bloomberg. According to Morgan Stanley, of Australia's four largest lenders, National Australia Bank Ltd. may generate the biggest proportion of profit in Queensland, or about 18%, Bloomberg reports. Assuming profitability is in line with branch numbers, the state probably accounts for about 14% of earnings at Commonwealth Bank of Australia, Westpac Banking Corp. and Australia & New Zealand Banking Group Ltd., Mr. Wiles wrote. ========= C H I N A ========= EVERGRANDE REAL: Fitch Affirms Issuer Default Rating at 'BB' ------------------------------------------------------------ Fitch Ratings affirmed Evergrande Real Estate Group Limited's Long-term foreign currency Issuer Default Rating at 'BB', as well as its foreign currency senior unsecured rating at 'BB' following its proposal to issue an international offering of USD settled CNY senior fixed rate notes. The proceeds from these notes will be used to repay certain onshore bank borrowings, to finance existing and new property projects, and for general corporate purposes. The Outlook on the IDR is Stable. "Evergrande's proposed issuance of synthetic CNY-denominated bonds will not change its credit profile, provided the coupon rate is fixed and not materially higher than that anticipated by management," says Ying Wang, Director on Fitch's Asia-Pacific Corporates team. "Evergrande has headroom to incur additional debt under the covenants of its existing 13% senior unsecured notes due 2015. The new bonds will increase Evergrande's liquidity to fund future land bank acquisitions and development spending. Meanwhile, the agency expects Evergrande's credit metrics to remain solid with a net debt-to-inventory ratio below 25% in the near term," adds Ms. Wang. Evergrande's IDR is supported by its sound business model, focusing on fast inventory turnover, which accelerates cash flows and reduces liquidity risk in a policy-driven residential property sector. Evergrande achieved solid contracted sales of CNY50.4 billion in 2010, well above its original target of CNY40 billion. The agency expects Evergrande to maintain prudent financial policies. The company's ratings and Outlook are underpinned by Fitch's assumption that management will continue to execute new land acquisitions without impairing its financial flexibility. Negative rating actions could occur if China's property demand falls significantly, or if there is a significant shift in management's risk appetite or financial policies, such as a reduced focus on inventory and cash flow turnover, or if aggressive debt-funded expansion leads to a net debt-to-inventory ratio sustained above 50%. Positive rating actions could be considered if Evergrande consistently achieves annual contracted sales growth, while maintaining a strong balance sheet. EVERGRANDE REAL: S&P Assigns 'BB-' Rating on Proposed Notes ----------------------------------------------------------- Standard & Poor's Ratings Services assigned its 'BB-' issue rating to the proposed issue of three- and five-year senior unsecured notes to be issued by Evergrande Real Estate Group Ltd. (BB/Stable/--). The proposed notes will be denominated in Chinese renminbi and settled in U.S. dollars. The issue rating is one notch lower than the rating on Evergrande to reflect structural subordination risks. The proposed notes have the same terms and conditions as those of the US$1.3 billion bond issued in 2010. The company will use the proceeds to refinance onshore borrowings, and for land acquisitions and working capital. In S&P's view, Evergrande will maintain credit ratios that are broadly supportive of a 'BB' corporate credit rating, factoring in the maximum amount that the company could raise from the proposed issue. S&P's expectation is mainly due to its strong property sales in the past 12 months and improving profitability; trends that are likely to continue in 2011. Based on contract sales achieved in 2010, the company has locked in about 50% of its target revenue for 2011. Evergrande's exposure to second- and third-tier cities--which are less volatile markets--its good execution, and good diversification supported sales in 2010. Evergrande's aggressive appetite for debt-funded expansion has, however, weakened the company's debt-to-capital ratio. The rating on the company could come under pressure if this ratio remains materially higher than the level in 2010 and margins do not improve. In S&P's view, the company has adequate liquidity, with surplus cash sufficient to meet short-term debt and land premiums due in 2011. The rating on Evergrande reflects the company's volatile and weak credit ratios, its aggressive growth and debt appetite, and its short operating and financial management track record. The company's operating environment, which is cyclical and competitive with evolving regulations, also constrains the rating. These weaknesses are tempered by Evergrande's large, low-cost, and geographically diversified land bank, competitively priced products due to good cost controls and economies of scale, and good execution because of standardized operations. The company develops large-scale residential housing projects in second- and third-tier cities, and has a nationwide presence in China. HOPSON DEVELOPMENT: S&P Places 'B' Issue Rating on Unsecured Notes ------------------------------------------------------------------ Standard & Poor's Ratings Services assigned its 'B' issue rating to the proposed issue of U.S.-dollar-denominated senior unsecured notes by Hopson Development Holdings Ltd. (B+/Stable/--). The issue rating is subject to our review of the final issuance documentation. The issue rating on Hopson's proposed notes is one notch lower than the corporate credit rating to reflect S&P's opinion that offshore noteholders would be materially disadvantaged, compared with onshore creditors, in the event of default. The company's ratio of priority borrowings to total assets will remain above S&P's notching threshold of 15% for speculative-grade debt. The rating on Hopson reflects the China-based property developer's aggressive expansion and its weaker-than-expected cash sales performance in 2010. Hopson's execution ability has been weaker than S&P expected. In S&P's view, its weak sales are partially attributable to its heavy exposure to tier-one cities and, increasingly, to high-end projects. These projects are more sensitive to policy initiatives introduced since 2010. In S&P's view, the company's financial management is aggressive and its financial policies are not clearly articulated. In addition, the rating is constrained by ongoing risks with related- party transactions and a mixed track record in transparency and information disclosure. Further, the frequent turnover of senior management is an additional risk factor. Hopson's proven track record and well-known brand name, particularly in tier-one cities, its diverse revenue stream from a large number of saleable property projects, and good profitability temper these risks. S&P consider Hopson's credit profile to be stronger than the average of 'B+' rated peers. ================ H O N G K O N G ================ AFK HK: Creditors' Proofs of Debt Due January 24 ------------------------------------------------ Creditors of AFK Hong Kong Limited, which is in members' voluntary liquidation, are required to file their proofs of debt by Jan. 24, 2011, to be included in the company's dividend distribution. The company's liquidators are: Cosimo Borrelli G Jacqueline Fangonil Walsh Level 17, Tower 1 Admiralty Centre 18 Harcourt Road Hong Kong ANALOG EXPRESS: Court Enters Wind-Up Order ------------------------------------------ The High Court of Hong Kong entered an order on January 5, 2011, to wind up the operations of Analog Express Asia Limited. The company's liquidator is Chiu Koon Shou. DAIKIN CHEMICAL: Lai and Hauhey Step Down as Liquidators -------------------------------------------------------- Lai Kar Yan (Derek) and Darach E. Hauhey stepped down as liquidators of Daikin Chemical (Hong Kong) Limited on December 31, 2010. DAILY FINE: Court to Hear Wind-Up Petition on January 26 -------------------------------------------------------- A petition to wind up the operations of Daily Fine Industrial Limited will be heard before the High Court of Hong Kong on January 26, 2011, at 9:30 a.m. Lai Tak Enterprises Limited filed the petition against the company. The Petitioner's Solicitors are: Messrs. Kong & Tang Unit A, 25th Floor EIB Centre 40-44 Bonham Strand Sheung Wan, Hong Kong DRANSFIELD HOLDINGS: Creditors' Meetings Set for January 18 ----------------------------------------------------------- Creditors of Dransfield Holdings Limited will hold their annual meetings on January 18, 2011, at 10:30 a.m., at 6/F., 88 Lockhart Road, Wanchai, in Hong Kong. At the meeting, Kenny King Ching Tam, the company's liquidator, will give a report on the company's wind-up proceedings and property disposal. FAVOUR CENTURY: Court Enters Wind-Up Order ------------------------------------------ The High Court of Hong Kong entered an order on December 29, 2010, to wind up the operations of Favour Century Limited. The company's official receiver is E T O'Connell. FUJIAN SHUNDA: Lui and Leung Step Down as Liquidators ----------------------------------------------------- Kennic Lai Hang Lui and Ruby Mun Yee Leung stepped down as liquidators of Fujian Shunda Polyester Fibre Company Limited on December 15, 2010. FULLBRIGHT COMPANY: Creditors' Proofs of Debt Due February 7 ------------------------------------------------------------ Creditors of Fullbright Company Limited, which is in members' voluntary liquidation, are required to file their proofs of debt by February 7, 2011, to be included in the company's dividend distribution. The company's liquidators are: Kong Chi How Johnson Lo Siu Ki 25/F., Wing On Centre 111 Connaught Road Central, Hong Kong FULL BRILLIANT: Court Enters Wind-Up Order ------------------------------------------ The High Court of Hong Kong entered an order on December 29, 2010, to wind up the operations of Full Brilliant Limited. The company's official receiver is E T O'Connell. FULLWIN LOGISTICS: Court to Hear Wind-Up Petition on February 23 ---------------------------------------------------------------- A petition to wind up the operations of Fullwin Logistics (H.K.) Co., Limited will be heard before the High Court of Hong Kong on February 23, 2011, at 9:30 a.m. Fan Yiu Wah filed the petition against the company. The Petitioner's Solicitors are: Szwina Pang, Edward Li & Co. Suite 1408, 14th Floor Prince's Building 10 Chater Road Central, Hong Kong ========= I N D I A ========= AMARAVTHY SPINNING: Fitch Puts 'B(ind)' Rating on INR38.5MM Loan ---------------------------------------------------------------- Fitch Ratings assigned India's Amaravthy Spinning Mills a National Long-term rating of 'B(ind)'. The Outlook is Stable. The agency has also assigned ratings to ASM's bank facilities, as follows: * INR38.5m long-term loan: 'B(ind)'; * INR14m fund-based working capital limits: 'B(ind)/F4(ind)'; * INR1.93m non-fund based working capital limits: 'F4(ind)'; and * Proposed INR60m long-term loan: Expected rating of 'B(ind)'. The ratings reflect ASM's small size of operations and low level of EBIDTA margins over FY06-FY09. Also, Fitch notes the inherent risk of operating in a commodity market characterized by the volatility in cotton prices, coupled with competitive pressures on pricing in the yarn market. The ratings are also constrained by the high leverage and the size of the proposed debt-funded capex relative to the present scale of operations. The ratings are further constrained by India's cotton yarn spinning industry's gradual recovery path following the global downturn and the power shortage in the state of Tamil Nadu. The ratings draw strength from ASM's high capacity utilization and modernised spinning facility. The company has proposed to increase its capacity to around 12,000 spindles in Q1FY12. Its EBITDA margins improved to 11.7% in FY10, due to the increase in production volumes and improvement in yarn price realizations. The working capital utilization has continued to be at the maximum levels. Negative ratings triggers include material deterioration of ASM's interest coverage to below 2x and total adjusted debt/EBITDA to beyond 6.5x, as well as any higher-than-anticipated liquidity pressures. Positive ratings triggers include timely completion of the proposed capex and the company's achievement of the projected level of revenue and profitability. Based in Udumalpet near Coimbatore, Tamil Nadu, ASM is involved in the manufacturing of cotton yarn. In FY10, ASM reported revenues of INR101.0 million and EBIDTA of INR11.8 million. ANDAMAN SEA: CRISIL Reaffirms 'B-' Rating on Various Bank Debts --------------------------------------------------------------- CRISIL's ratings on the bank facilities of Andaman Sea Foods Pvt Ltd's continue to reflect ASFPL's below-average financial risk profile, exposure to fluctuations in foreign exchange rates, and susceptibility to risks inherent in the seafood industry. These weaknesses are partially offset by the company's established position in the seafood-export business and its healthy operating efficiency. Facilities Ratings ---------- ------- INR233.8 Million Term Loan B-/Stable (Reaffirmed) INR2.5 Million Cash Credit B-/Stable (Reaffirmed) INR115 Million Export Packing Credit B-/Stable (Reaffirmed) (EPC)/ Packing Credit in foreign currency (PCFC) INR22.5 Mil. Foreign Bills Discounting P4 (Reaffirmed) (FBD)/Export Bills Receivable (EBR) INR30 Million Standby Line of Contract P4 (Reaffirmed) INR30 Million Letter of Credit (LC) P4 (Reaffirmed) INR10 Million Bank Guarantee (BG) P4 (Reaffirmed) Outlook: Stable CRISIL believes that ASFPL will continue to benefit from the healthy demand for Indian shrimp in the global market and expansion of its operations in Thailand, over the medium term. The company will also maintain its moderate operating efficiency. The outlook may be revised to 'Positive' upon better than anticipated improvement in ASFPL's scale of operations, operating margin, and realisations or substantial infusion of capital thereby improving the net-worth of the company. Conversely, the outlook may be revised to 'Negative' if the company undertakes a large, debt- funded capital expenditure programme, leading to deterioration in its capital structure, or if its volumes or margins decline steeply. Update For 2009-10 (refers to financial year, April 1 to March 31), ASFPL reported an operating income of INR590 million and an operating margin of 5.4 per cent, in line with CRISIL's expectations. For the eight months ended November 30, 2010, ASFPL achieved a turnover of INR380 million and the company is expected to post a 20 per cent growth in revenues for 2010-11, compared to the previous year, driven by recovery in demand and increased offtake from its customers. The company's financial risk profile continues to remain below average; marked by negative net worth of INR147 million as on March 31, 2010, owing to forex forward losses incurred during 2008-09. The accumulated losses for ASFPL were around INR190 million as on March 31, 2010. ASFPL's working capital requirements have been generally high, with the company maintaining an inventory level of 90 days on an average. ASFPL's net cash accruals have been low in the past at around INR7-8 million; however the company is expected to have sufficient accruals to meet its debt obligations of around INR20 million over the medium term, with the company reporting cash accruals of INR13 million for the eight months ending November 2010. ASFPL reported a net profit of INR7.8 million on net sales of INR545 million for 2009-10 (refers to financial year, April 1 to March 31), against net losses of INR193 million on net sales of INR452.20 million for 2008-09. About Andaman Sea Set up in 1995 in Kolkata by Mr. Amit Ranjan Mukherjee, ASFPL processes and exports cultured shrimp and fish. It primarily caters to the Europe, the US, Japan, Korea, Malaysia, South Africa, and the UAE markets. The company procures shrimp from aquaculture farmers and agents, and has the shrimp processed on job-work basis. ANJANAY RICE: CRISIL Assigns 'BB' Rating to INR75.1MM LT Loan ------------------------------------------------------------- CRISIL has assigned its 'BB/Stable/P4+' ratings to the bank facilities of Anjanay Rice Mill Pvt Ltd. Facilities Ratings ---------- ------- INR250 Million Cash Credit BB/Stable (Assigned) INR75.1 Million Long-Term Loan BB/Stable (Assigned) INR4 Million Bank Guarantee P4+ (Assigned) The ratings reflect ARMPL's modest scale of operations and financial risk profile, and its susceptibility to adverse changes in government policies. These weaknesses are partially offset by the experience of ARMPL's promoters in the rice milling and processing industry. Outlook: Stable CRISIL believes that ARMPL will continue to benefit from the industry experience of its promoters and stable demand for its products. The outlook may be revised to 'Positive' if the company generates higher-than-expected revenues and net cash accruals, and reports better-than-expected debt protection indicators. Conversely, the outlook may be revised to 'Negative' in case of larger-than-expected debt-funded capital expenditure, leading to deterioration in ARMPL's gearing and debt servicing capability over the medium term. About Anjanay Rice ARMPL, incorporated in 2006 and promoted by Mr. Krishna Murari Choudhary, is in the business of processing rice products, which include raw and boiled rice. It has a manufacturing facility at Burdwan (West Bengal) with a capacity to process around 200 tonnes per day of rice. ARMPL reported a profit after tax (PAT) of INR 5.5 million on net sales of INR1001.5 million for 2009-10 (refers to financial year, April 1 to March 31), against a PAT of INR 0.9 million on net sales of INR519.7 million for 2008-09. BLS ECOTECH: CRISIL Places 'BB-' Rating to INR180MM Long Term Loan ------------------------------------------------------------------ CRISIL has assigned its 'BB-/Stable' ratings to the bank facilities of BLS Ecotech Ltd. Facilities Ratings ---------- ------- INR45.0 Million Cash Credit BB-/Stable (Assigned) INR180.0 Million Long Term Loan BB-/Stable (Assigned) The ratings reflect BLSE's exposure to funding, implementation and offtake risks associated with its Polyester Staple Fibre (PSF) project, its modest scale of operations, and moderate financial risk profile, marked by low turnover and small net worth. The weaknesses are partially offset by the extensive experience of BLSE's promoters in the recycled plastic products industry. Outlook: Stable CRISIL expects BLSE to benefit over the medium term from the longstanding experience of its promoters in the recycled plastic products industry, and its established customer relationships. The outlook may be revised to 'Positive' in case the company is able to sustain a significant improvement in revenues and net cash accruals while maintaining its robust capital structure. Conversely, the outlook may be revised to 'Negative' in case of slowdown in revenue growth or deterioration in debt protection indicators, or a large, debt-funded capital expenditure. About BLS Ecotech BLSE, a Delhi-based plastic reprocessing company, was incorporated in 2007. The company is part of the Delhi-based BLS group, which has been running since 1954. The group is well diversified and functions in various industries such as plastics, petrochemicals, education, and residential and commercial infrastructure. The promoters Aggarwal brothers, viz. Mr. Vinod Aggarwal, Mr. Sushil Aggarwal, Mr. Madhukar Aggarwal and Mr. Diwakar Aggarwal are involved in the overall operations of the company. The company offers various recycled plastic products like recycled Polyethylene terephthalate (PET), Polypropylene (PP). BLSE reported a profit after tax (PAT) of INR3.09 million on net sales of INR106.67 million for 2009-10 (refers to financial year, April 1 to March 31), against a PAT of INR0.79 million on net sales of INR77.64 million for 2008-09. FATEH CHAND: Fitch Affirms 'BB+(ind)' National Long-Term Rating --------------------------------------------------------------- Fitch Ratings affirmed India's Fateh Chand Charitable Trust's National Long-term rating at 'BB+(ind)'. The Outlook is Stable. The agency has also affirmed the ratings on FCCT's bank facilities, as follows: * INR351.8m term loan limits (reduced from INR420m): 'BB+(ind)'; and * INR105m non-fund based bank limits (comprising bank guarantees); 'F4(ind)'. The ratings continue to reflect the stable nature of revenues from FCCT's medical college and hospital, demand-supply gap for the physicians and medical staff in the country, as well as high operating margins and moderate net leverage levels for MMCH. The ratings also draw comfort from the good infrastructure at the college, as well as from the quality and experience of the faculty members. The ratings are however constrained by the limited track record and small size of operations for the college and hospital coupled with the regulatory risks associated with the medical education in the country. Fitch notes that MMCH is planning to increase the student intake and to add more courses including the clinical and non-clinical post-graduate courses, which shall contribute towards increase in revenues. Positive rating triggers include a significant increase in FCCT's size of operations, coupled with a decline in financial leverage on a sustained basis. Negative triggers include any debt-led capex by the company, which would result in a deterioration of the financial leverage, vacant seats in the medical college, and lower hospital occupancy, leading to a weakening in revenues and margins. In FY10, FCCT's revenues improved to INR258m (up 24% yoy), operating EBITDAR margins were at around 46% (FY09: 48%), total adjusted debt was INR449m (FYE09: INR444m) and net leverage (total adjusted net debt/operating EBITDAR) was 3.7x (FY09: 4.3x). FCCT is a charitable trust registered in Muzaffarnagar, Uttar Pradesh. It has been in existence since 2005. The trust has 26 members and operates a medical school plus hospital, and a paramedical college to impart nursing education and training. MARKETING TIMES: CRISIL Places 'B+' Rating to INR230MM Cash Credit ------------------------------------------------------------------ CRISIL has assigned its 'B+/Stable/P4' ratings to the bank facilities of Marketing Times Automobiles Pvt Ltd. Facilities Ratings ---------- ------- INR230 Million Cash Credit B+/Stable (Assigned) INR70 Million Overdraft Facility B+/Stable (Assigned) INR50 Million Bank Guarantee P4 (Assigned) The ratings reflect MTA's weak financial risk profile, marked by highly leveraged structure and low interest coverage, and exposure to risks related to intense competition in the automotive dealership market. These rating weaknesses are partially offset by the improvement in MTA's operating margin as a result of higher contribution from spare parts sales and service income. Outlook: Stable CRISIL believes that MTA's financial risk profile will remain strained over the medium term because of the company's highly leveraged capital structure and weak debt protection metrics. The outlook may be revised to 'Positive' if MTA's capital structure improves substantially through equity infusion or higher cash accruals. Conversely, the outlook may be revised to 'Negative' in case of a decline in topline or operating margin, leading to further deterioration of MTA's debt protection metrics, or if the company contracts a large quantum of debt to fund its capital expenditure, impacting its financial risk profile. About Marketing Times Incorporated in 2003 by Mr. Deepak Kapoor and his family, MTA commenced operations in 2004 on attaining a dealership of Maruti Suzuki India Ltd (MSIL, rated 'AAA/Stable/P1+' by CRISIL). Currently, MTA has one showroom and two workshops in New Delhi. The company also deals in resale of old vehicles through a true value showroom at MG Road (New Delhi) and in spare parts of MSIL. MTA reported a profit after tax (PAT) of INR6.7 million on net revenue of INR1338.5 million for 2009-10, against a PAT of INR6.8 million on net revenue of INR1976 million for 2008-09. REACH CARGO: CRISIL Reaffirms 'P4+' Rating on INR10 Million LOC --------------------------------------------------------------- CRISIL's ratings on the bank facilities of Reach Cargo Movers Pvt Ltd continue to reflect RCMPL's exposure to intense market competition, and limited financial flexibility because of small scale of operations and large working capital requirements. The impact of these weaknesses is mitigated by RCMPL's strong clientele and sound business model marked by a small fixed-asset base. Facilities Ratings ---------- ------- INR195.0 Million Cash Credit BB-/Stable (Enhanced from INR155 Million) INR10.0 Million Letter of Credit/ P4+ (Reaffirmed) Bank Guarantee Outlook: Stable CRISIL believes that RCMPL's business risk profile will remain moderate over the medium term, supported by healthy growth prospects for the freight movement sector and RCMPL's strong clientele. The outlook may be revised to 'Positive' if there is an improvement in RCMPL's working capital management or substantial increase in its net worth of equity infusion by promoters. Conversely, the outlook may be revised to 'Negative' if the profitability of the company comes under considerable pressure or the company undertakes a large, debt-funded capital expenditure programme, resulting in deterioration in its capital structure. Update RCMPL's net revenues increased by around 30 per cent in 2009-10 (refers to financial year, October 1 to September 30) over that in the previous year, driven by improvement in macroeconomic environment. The company's operating margin increased to 7.3 per cent in 2009-10 from 6.4 per cent in 2008-09 as the company managed to negotiate higher margins with its customers, supported by the revival in demand. Its debt protection metrics improved, with significant increase in operating profits and net cash accruals and no increase in debt level. The company does not plan to add any more trucks to its fleet over the next two years and will continue to meet incremental demand from its customers by outsourcing additional trucks. However, the company's operations remain working capital intensive, with an average bank limit utilization of around 99.6 per cent over the period 12 months ended November 2010. Though the company has enhanced its bank limits to INR200 million in August 2010 from INR150 million, there have been instances of overdrawl in cash credit limits; the same have been cleared within seven days. Global Asia Venture Co (GAVC, owns 40 per cent stake in RCML), continues to remain invested in RCMPL and no exit option is available to them over the next one year. CRISIL believes that RCMPL would not be using its reserves to buy-back its stake owned by GAVC. RCMPL, on a provisional basis, reported a net profit of INR15 million on net sales of INR900 million for 2009-10, against a net loss of INR13 million on net sales of INR660 million for 2008-09. About Reach Cargo RCMPL, set up in 2004 by Mr. Arup Deb, is a logistics company, transporting goods such as automobile spare parts, steel plates, transformers, excavators, and train engines. The company has a fleet of 60 trucks and 48 axles. The company maintains a balance of own trucks and outsourced trucks, with around 80 per cent of its total revenues in 2009-10 coming from outsourced trucks. Outsourcing trucks gives the company flexibility to adapt to variability in demand. The company's revenues come from a mix of long-term and spot contracts. For long-term contracts, the company fixes its prices for different routes; changes in fuel prices are entirely passed on to the customers. Long-term contracts accounted for around 70 per cent of the company's revenues in 2009-10; spot contracts accounted for the remainder. SARADA PROJECTS: CRISIL Reaffirms 'BB' Rating on INR50MM LT Loan ---------------------------------------------------------------- CRISIL's ratings on Sarada Projects Ltd's bank facilities continue to reflect the geographical concentration in SPL's revenue profile, its small scale of operations and low project diversity, and its exposure to risks relating to fluctuations in raw material prices. These rating weaknesses are partially offset by SPL's comfortable financial risk profile, marked by healthy gearing and debt protection measures, and the benefits that the company derives from its promoters' experience in the construction industry. Facilities Ratings ---------- ------- INR50.00 Million Long-Term Loan BB/Stable (Reaffirmed) INR10.00 Million Cash Credit BB/Stable (Reaffirmed) INR150.00 Million Bank Guarantee P4+ (Reaffirmed) Outlook: Stable CRISIL believes that SPL will maintain its low debt levels and benefit from its moderate order book, over the medium term. The outlook may be revised to 'Positive' if SPL enhances its scale of operations substantially, and diversifies its revenue profile while maintaining its profitability. Conversely, the outlook may be revised to 'Negative' if the company's profitability margins deteriorate steeply, or it undertakes a large, debt-funded capital expenditure programme, weakening its financial risk profile. Update SPL's performance in 2009-10 (refers to financial year, April 1 to March 31) was marginally below CRISIL's expectations, pending acceptance of bills by government departments. Though SPL has not bagged any fresh orders since the initial rating, its current order book is at INR700 million to be executed next 12 months. The firm's capital structure remains as per CRISIL expectation as at 0.35 times as on March 31, 2010; gearing and liquidity remain adequate for the rating category. Sarada reported a profit after tax (PAT) of INR8 million on net sales of INR149 million for 2009-10 (refers to financial year, April 1 to March 31) against a PAT of INR8 million on net sales of INR155 million for 2008-09 About Sarada Projects SPL was originally set up as a partnership concern, Sarada Projects, by Mr. Boppana Ramesh Kumar and his family members in 1991; the firm was reconstituted as a public limited company in 1996. SPL executes civil construction projects for government and quasi-government departments. The projects are spread over five states: Assam, Arunachal Pradesh, Andhra Pradesh, Madhya Pradesh, and Chhattisgarh. Soma Holdings Ltd, a group company of Hyderabad- based construction company Soma Enterprises Ltd (Soma), holds a 40 per cent stake in SPL. SPL executes projects directly, as well as in a joint venture with, and on a sub-contract basis from, Soma. SHREYANS INDUSTRIES: CRISIL Withdraws 'BB' Rating on Debentures --------------------------------------------------------------- CRISIL has reaffirmed its ratings on the bank facilities of Shreyans Industries Ltd at 'BB/Positive/P4+', and withdrawn its rating on the company's non-convertible debentures as they have been prematurely redeemed in July 2010. Facilities Ratings ---------- ------- INR31.26 Million Non-Convertible BB/Positive (Withdrawn) Debentures INR157.5 Million Cash Credit Limit BB/Positive (Reaffirmed) INR457.5 Million Term Loan (Reduced BB/Positive (Reaffirmed) from INR564.70 Million) INR185.0 Million Bank Guarantee P4+ (Enhanced from INR77.8 Million) The outlook remains 'Positive' because despite lower profitability in 2009-10 (refers to financial year, April 1 to March 31) and 2010-11, Shreyans had comfortable debt protection metrics owing to lower levels of debt. Though CRISIL does not believe that there will be a significant improvement in Shreyans's profitability from current levels over the medium term, the company's financial risk profile would remain better than its current rating category indicates. This is because its debt levels would continue at current levels with moderate capital expenditure (capex), and hence it would maintain its favorable capital structure and comfortable debt protection metrics. The outstanding ratings continue to reflect the susceptibility of Shreyans' profitability to intense market competition and cyclicality in paper prices, and its weak business risk profile, marked by low profitability margins. These rating weaknesses are partially offset by Shreyans's moderate financial risk profile, marked by a favorable capital structure and comfortable debt protection metrics. Outlook: Positive CRISIL believes that with moderate capex plans, Shreyans's financial risk profile will continue to be supported by its low gearing and comfortable liquidity position, marked by low bank limit utilization, over the medium term. The rating may be revised upwards if the company stabilizes its operating performance or shows significant and sustained improvement in profitability, while maintaining its favorable capital structure. Conversely, the outlook may be revised to 'Negative' if Shreyans's profitability declines further or the company undertakes a larger- than-expected debt-funded capex programme, leading to deterioration in its debt protection metrics. About Shreyans Industries Incorporated in 1979, Shreyans manufactures writing and printing paper. It has two paper mills with an aggregate capacity of 66,000 tonnes per annum (tpa). At present, it is run by brothers, Rajneesh Oswal and Vishal Oswal. The company came out with an initial public offering in 1982, in order to raise funds to set up a 10,000-tpa paper mill at Ahmedgarh, Ludhiana (Punjab). In 1991, it made a follow-on offer-cum-rights issue to raise funds for plant modernisation and to set up a 25,000-spindle yarn spinning unit at Machiwara, Ludhiana. In 1994, the company purchased a paper mill from Zenith Ltd to increase its paper manufacturing capacity. Due to the poor performance of the spinning unit, the same was sold in 2000. Around the same time, Shreyans was unable to meet some of its debt-servicing obligations, and in January 2003, it entered the Corporate Debt Restructuring (CDR) cell. Since then, Shreyans's performance has improved, leading to its exit from the CDR cell in January 2008. For 2009-10, Shreyans reported a profit after tax (PAT) of INR54 million on net sales of INR2.38 billion, against a PAT of INR181.1 million on net sales of INR2.58 billion for the preceding year. SHRI CHAKRA: CRISIL Downgrades Rating on INR83.2MM Loan to 'D' -------------------------------------------------------------- CRISIL has downgraded its ratings on the bank facilities of Shri Chakra Udyog Ltd to 'D/P5' from 'BBB-/Stable/P3'. The rating downgrade is driven by instances of delays by Shri Chakra in servicing some of its rated debt. The earlier ratings by CRISIL were predicated on Shri Chakra's declaration that it was meeting, and continued to meet, all its financial obligations on a timely basis. However, CRISIL now understands that the company has delayed in servicing its debt for some time; this indicates that Shri Chakra's management had provided incorrect declarations to CRISIL regarding timely debt servicing. Facilities Ratings ---------- ------- INR83.2 Million Term Loan D (Downgraded from 'BBB-/Stable') INR644.5 Million Packing Credit P5 (Downgraded from 'P3') INR320.5 Million Bill Purchase/ P5 (Downgraded from 'P3') Bill Discounting INR77.5 Million Bank Guarantee P5 (Downgraded from 'P3') and Letter of Credit INR132.0 Million Stand by line P5 (Downgraded from 'P3') of credit INR16.3 Bank Guarantee P5 (Downgraded from 'P3') Shri Chakra also has a leveraged financial risk profile, project- implementation risk, and its exposure to risks related to fragmented markets and adverse changes in government regulations. These weaknesses are partially mitigated by Shri Chakra's established position in agricultural-products trading in the international market, and healthy operating margin. About Shri Chakra Incorporated in 1996, Shri Chakra is a government-recognised, two- star export house that undertakes international trading in agricultural commodities and building materials. In May 2009, Shri Chakra commissioned a unit for the processing of agricultural commodities in Kandla special economic zone; the processing division contributed to about 21 per cent of the company's sales in 2009-10 (refers to financial year, April 1 to March 31). The company is promoted by Mr. R B Vinod Kumar Nair and Mr. Ashok Rao. It has also been awarded the status of gold card holder under the exporters' gold card scheme of Reserve Bank of India. The company trades primarily in agricultural commodities such as spices, oil seeds, food grains, and fruit pulp. In 2003, the company began to internationally trade in building materials, such as wall and floor tiles, and slabs and tiles of marble, granite, and other natural stones. For 2009-10, Shri Chakra reported a profit after tax (PAT) of INR131.8 million on net sales of INR3.25 billion, against a PAT of INR71.8 million on net sales of INR2.47 billion for 2008-09. STAR DRUGS: CRISIL Reaffirms 'D' Ratings on Various Bank Debts -------------------------------------------------------------- CRISIL's ratings on the bank facilities of M/s. Star Drugs & Research Labs Limited reflect the continued default by the company in repayment of its term loan. Facilities Ratings ---------- ------- INR90 Million Cash Credit D (Reaffirmed) INR287.2 Million Long-Term Loan D (Reaffirmed) INR42.8 Million Proposed LT Bank D (Reaffirmed) Loan Facility INR30 Million Letter of Credit/ P5 (Reaffirmed) Bank Guarantee SDRL was incorporated in 1992 by Mr. K A Hafeez, Mr. K A Salam, and Mr. K A Matheem. The company manufactures small-volume parenterals at its Hosur (Tamil Nadu)-based facility, which have received World Health Organisation-good manufacturing practice approvals. SWARNA PROJECTS: CRISIL Assigns 'B' Rating to INR200MM Cash Credit ------------------------------------------------------------------ CRISIL has assigned its 'B/Stable/P4' ratings to the bank facilities of Swarna Projects Pvt. Ltd. Facilities Ratings ---------- ------- INR200 Million Cash Credit B/Stable (Assigned) INR100 Million Letter of Credit P4 (Assigned) INR100 Million Bank Guarantee P4 (Assigned) The ratings reflect SPPL's below-average financial risk profile, marked by a small net worth and high gearing, and exposure to risks related to high customer concentration in revenue profile, and a limited track record. These rating weaknesses are partially offset by the diversified business presence of SPPL's promoters. Outlook: Stable CRISIL believes that SPPL will continue to benefit over the medium term from its promoters' experience of executing turnkey projects. The outlook may be revised to 'Positive' if the company improves its operating margin substantially, or significantly scales up its operations. Conversely, the outlook may be revised to 'Negative' if SPPL's debt protection metrics deteriorate, most likely because of a decline in margins, or in case of large, debt-funded capital expenditure. About Swarna Projects Incorporated on January 1, 2009, SPPL has been executing its first project (part of the Maharastra Infrastructure Phase II of Rural Electrification) since November 2009. The contract for the project, which is worth around INR1.7 billion in Maharashtra, was obtained from Ramky Infrastructure Ltd (rated 'A-/Stable/P2+' by CRISIL), which in turn obtained it from the Maharashtra State Electricity Board. The promoters of SPPL have been undertaking various infrastructure and real estate projects since 1999 through the various group companies. SPPL reported a profit after tax (PAT) of INR1 million on net sales of INR40 million for 2009-10 (refers to financial year, April 1 to March 31). VINAY INDUSTRIES: CARE Assigns 'CARE BB' Rating to INR4.66cr Loan ----------------------------------------------------------------- CARE assigns 'CARE BB' and 'PR4' RATINGS to the bank facilities of Vinay Industries Ltd. Amount Facilities (INR Crore) Ratings ---------- ----------- ------- Long-term Bank Facilities 4.66 'CARE BB' Assigned LT/Short-term Bank Facilities 15.00 'CARE BB'/ 'PR4' Assigned Rating Rationale Rating Rationale The ratings are constrained by Vinay Industries Limited's small scale of operations restricting economies of scale, weak financial risk profile marked by highly leveraged capital structure, losses incurred in FY10 and stressed liquidity position. Susceptibility of its inherently low margins to the volatile prices of its raw materials and the company's presence in the highly volatile, fragmented and competitive agro-commodity (edible oil & cotton ginning) business entailing limited pricing flexibility also constrain the ratings. Further the ratings take into account the regulatory uncertainties on import duties for edible oils, export of cotton and fixation of Minimum Support Price (MSP) of cotton, seasonality associated with availability of raw materials and working capital intensive nature of its operations. These constraints far outweigh the benefits derived from the promoters' experience, locational advantage by way of proximity to the groundnut and cotton seed growing regions in Gujarat and diversified revenue stream. Rationalization of debt levels coupled with increase in capital base and its ability to manage volatility associated with commodity prices in edible oil and cotton ginning industry and thereby improve its profitability would remain the key rating sensitivity. Junagadh-based Vinay Industries Limited, promoted by Mr. Kanubhai V. Domadia and incorporated in November 1974, is engaged in the crushing, processing, refining of ground-nut, soybean, rapeseed and extracting oil from various types of de-oiled cake. In end- FY09 it diversified its operations by setting up a cotton ginning unit. In FY10 it also acquired the solvent extraction plant of M/s. Gujarat Agro Processers - a partnership firm. Further, to avail tax benefit, VIL set up a wind mill in Bhavnagar district of Gujarat having a capacity of 1.25 MW. As against a net loss of INR0.50 crore on a total income of INR82.37 crore in FY09, VIL incurred a net loss of INR3.78 crore on a total income of INR82.59 crore in FY10. Despite improvement in both its PBILDT margin and cash accruals during FY10, it incurred a loss mainly on account of higher charge of depreciation on wind mill. VISHAAL PROMOTERS: CRISIL Assigns 'C' Rating to INR100MM LT Loan ---------------------------------------------------------------- CRISIL has assigned its 'C' rating to the bank facilities of Vishaal Promoters Pvt Ltd. The ratings reflect VPPL's weak liquidity, which has resulted in the company's delays in servicing its unrated debt. Facilities Ratings ---------- ------- INR100.00 Million Long-Term Loan C (Assigned) INR120.00 Million Cash Credit C (Assigned) The ratings also factor in VPPL's exposure to risks related to implementation and commercialization of its ongoing mall project in Madurai (Tamil Nadu), and geographical concentration in its revenue profile. These weaknesses are partially offset by the experience of VPPL's promoters in the real estate business. VPPL was originally set up in 2001 as a partnership firm by Mr. I Ilankovan and his wife; the firm was reconstituted as a private limited company in 2004. VPPL is based in Madurai, and is engaged in real estate development, primarily residential flats. The company is currently constructing a mall in Madurai which is expected to be completed by January 2011. VPPL, on a provisional basis, reported a profit after tax (PAT) of INR8.23 million on net sales of INR65.46 million for 2009-10 (refers to financial year, April 1 to March 31); it had reported a PAT of INR14 million on net sales of INR69.36 million for 2008-09. WAHI SONS: CRISIL Assigns 'BB' Rating to INR58.2 Million Term Loan ------------------------------------------------------------------ CRISIL has assigned its 'BB/Stable' rating to the bank facilities of Wahi Sons Pvt Ltd. Facilities Ratings ---------- ------- INR6.8 Million Cash Credit Limit BB/Stable (Assigned) INR58.2 Million Term Loan BB/Stable (Assigned) The rating reflects WSPL's modest financial risk profile, marked by high gearing and small net worth, small scale of operations, large working capital requirements, and its exposure to risks related to customer concentration in its revenue profile. These weaknesses are partially offset by WSPL's established track record in the automobile (auto) components industry. Outlook: Stable CRISIL believes that WSPL will benefit over the medium term from its promoters' extensive industry experience and healthy demand from the end-user industry. Its financial risk profile is, however, expected to remain moderate due to high gearing. The outlook may be revised to 'Positive' if the company repays or converts its unsecured loans through equity, leading to improvement in gearing, and consequently, the financial risk profile. Conversely, the outlook of the company may be revised to 'Negative' if the company's margins decline or in case of deterioration in its financial risk profile, on account of a large, debt-funded capital expenditure programme or larger-than- expected working capital requirements. About Wahi Sons WSPL, established in 1997, manufactures sheet metal press stamping parts for the auto industry. WSPL's product portfolio includes anchor plates, ratchets, frames, tounge plates, lever adjusters, brackets, and rear lift assemblies. These products are used in seats, seat belts, steering wheels, and power windows. It supplies to Maruti Suzuki India Ltd (rated AAA/ Stable/ P1+ by CRISIL) and TATA Motors Limited (rated AA-/ Stable/ P1+ by CRISIL) through its vendors. The company is promoted by Mr. Manav Wahi, son of Mr. Arun Wahi (promoter of Abhishek Auto Industries Ltd, which entered into a joint venture with Key Safety Systems (KSS), US in 2007-08 [refers to financial year, April 1 to March 31] to form KSS Abhishek Safety Systems Pvt Ltd [rated 'BB/Negative/P4+' by CRISIL]). The Wahi family has over twenty years' experience in the auto industry. WSPL reported a profit after tax (PAT) of INR8 million on net sales of INR215 million for 2009-10, as against a PAT of INR3.5 million on net sales of INR188 million for 2008-09. ================= I N D O N E S I A ================= PT SULFINDO: Fitch Assigns 'B' Issuer Default Rating ---------------------------------------------------- Fitch Ratings assigned a 'B' Long-term foreign currency Issuer Default Rating with a Stable Outlook and a foreign-currency senior unsecured rating of 'B' to PT Sulfindo Adiusaha. At the same time, the agency has also assigned an expected rating of 'B' to the proposed senior secured USD notes to be issued by Sulfindo Netherlands B.V. and guaranteed by Sulfindo. The final rating is contingent upon receipt of final documents conforming to information already received. "Sulfindo's credit profile is constrained by its small size, plants located in a single site production facility and limited geographical and product diversification," says Jeong Min Pak, Senior Director in Fitch's Asia-Pacific Corporates team. Fitch also notes that the planned construction of a power plant will burden the company with substantial capex over the next two to three years. Given the highly cyclical nature of the chemical industry, the company is also vulnerable to the general economic cycle and subject to volatile products and feedstock volume and prices. However, Sulfindo's rating is supported by the company's status as one of the only two fully integrated producers of chlor-alkali in Indonesia, solid market position in the domestic chlor-alkali and PVC product markets, and improving industry fundamentals and profitability across its business segments. The agency expects the company's credit profile to have improved in 2010; but given the large capex in the next couple of years due to a power plant construction, credit metrics such as leverage and interest coverage ratios are expected to deteriorate until 2012 and then start to improve after the completion of the power plant. Nevertheless, the agency expects adjusted net debt/operating EBITDAR to remain mostly below 3.0x and operating EBITDAR/gross interest ratio to remain above 2.0x over the next two to three years, hence the Stable Outlook. Negative rating guidelines include a significant downturn in the industry or jump in raw material prices, which could lead the company's credit metrics to breach the following financial guidelines: significant market share decline in respective products in its domestic market; adjusted net debt/operating EBITDAR ratio exceeding 3.0x and operating EBITDAR/gross interest ratio falling below 2.0x on a sustained basis, and material delays in the construction of the power plant. Positive rating guidelines include an increase in scale and revenue, adjusted net debt/operating EBITDAR ratio of less than 1.5x and operating EBITDAR/gross interest ratio of greater than 5.0x on a sustained basis, and diversification of product lines or production facilities to improve single product/site risk. ========= J A P A N ========= JAPAN AIRLINES: JAL, AMR to Start Joint Business Venture in April ----------------------------------------------------------------- Japan Airlines and American Airlines announced Tuesday they have decided to commence their joint business from April 1, 2011, based on the expected start of revenue-sharing on applicable trans- Pacific flights. The airlines, after receiving regulatory approvals from the Japanese Government and the U.S. Department of Transportation, are using a phased approach to bring more travel choices and greater benefits to consumers as quickly as possible and to maximize the value for stakeholders. Customers can expect to benefit from better flight schedules, expanded codesharing, more coordinated services, and greater access to a wider variety of fares. Japan Airlines will also co-locate in American's Terminal 3 at Chicago O'Hare International Airport effective March 27, when Japan Airlines' summer schedule begins. Additional consumer benefits over the coming months are expected as the cooperation level deepens between the two airlines. In addition, to bring benefits to consumers sooner, Japan Airlines and American are announcing a jointly-formulated commemorative trans-Pacific economy-class airfare for sale in Japan from Jan. 11 for travel between February 1 and March 31, 2011. Historically, routings involving both airlines were typically only available at much higher fare levels. Applicable routes: Tokyo - San Francisco; Los Angeles; Chicago; New York; Dallas/Fort Worth. Customers may choose to fly Japan Airlines, American Airlines or a combination of both airlines on these routes. Scope of the Joint Business The joint business will apply to non-stop flights on 10 trans- Pacific routes initially. It is expected to be expanded upon obtaining the required approval from authorities of third-party countries to add routes linking destinations beyond Japan and North America. Trans-Pacific Flights Operating Carrier Route JAL Narita = New York, Chicago, Los Angeles, Vancouver Haneda = San Francisco AA Narita = Dallas/Fort Worth, New York, Chicago, Los Angeles Haneda = New York, Beijing = Chicago, Shanghai = Chicago, Los Angeles Connecting flights from the above trans-Pacific Flights Operating Carrier Routes JAL Asia, domestic points within Japan AA Canada, Mexico, Puerto Rico, U.S. Virgin Islands, domestic points within USA (Excludes Hawaii) Business Benefits Japan Airlines and American plan to share revenue generated from operations over the Pacific, regardless of which airline carries the customer beginning April 1, 2011. The companies' sales forces will work together to sell both brands in order to meet customers' needs through a process called "metal neutral selling'. The combined sales forces will be able to offer customers a broader suite of products and services than in the past. In addition, the airlines will maximize synergies to strengthen their business and elevate their level of operational efficiency and productivity while reducing costs. Expected business benefits include: - More coordinated pricing and programs for travel agencies and corporate customers. - Under the joint business agreement, Japan Airlines and American's sales forces can conduct activities in cooperation to promote themselves together, thereby boosting the productivity and efficiency of the sales teams, and increasing the opportunities for sales and publicity. - In the future, the two airlines plan to jointly sell Japan Airlines' premium economy product; which is expected to make both airlines more competitive in the marketplace. American's customers will have a new travel option that did not previously exist. - Japan Airlines and American both offer first class service on most of the trans-Pacific routes, allowing first class customers to enjoy the increase in flight options. - Expected investment and operational efficiencies gained from co-locations at airports, offices, joint lounge operations, and other operational synergies are expected to make both airlines stronger. - Purchase of Japan Airlines and American's applicable trans- Pacific flights from either airline's website increases the exposure and sales opportunities for the two brands. Customers will benefit from more convenience as they will be able to select flights and gain access to information about both airlines through one channel. - Japan Airlines and American are also exploring potential opportunities to utilize each other's online presence around the globe with the goal of enhancing customer service. The new ability to coordinate on pricing, network and schedule, products and services is expected to result in greater revenue and market share as Japan Airlines and American become more competitive with other airlines partnerships. American will be able to sell more destinations within and beyond Japan than before Open Skies and the joint business with Japan Airlines. Conversely, Japan Airlines will be able to sell more destinations in North America. Over the past several months, Japan Airlines and American have deepened their relationship, which began more than 15 years ago, by sharing best practices to improve their individual operations so as to increase their competitiveness in their respective regions and enhance customer service. For instance, Japan Airlines has begun to implement business management and profit- forecast procedures shared by American, and teams from both airlines have been exchanging best practices in such specialized fields as maintenance, fleet planning, and information technology. The result of adopting American's profit-forecast concept is expected to enhance Japan Airlines' profit-forecast capability - providing more time for the airline to make adjustments to business changes. American has been discussing Japanese culture with Japan Airlines to better understand how to serve these customers better. For example, by making American's public address announcements more conversational and using new phrases that better describe situations, these announcements are more meaningful to Japanese customers. From January 17, American will relocate its Asia-Pacific Regional Office in Tokyo from the Chiyoda district to Shinagawa, moving into NRE Tennozu Building where Japan Airlines' headquarters is located. In New York, Japan Airlines moved its administration office into the same building as American on Lexington Avenue on October 28, 2010. The office co-location will allow Japan Airlines and American Airlines employees to work more closely together. About Japan Airlines Japan Airlines Corporation -- http://www.jal.co.jp/-- is a Japan-based company mainly engaged in the provision of air transport services. The Company is active in five business segments through its 203 subsidiaries and 83 associated companies. JAL International Co. Ltd. is a wholly owned operating subsidiary of Japan Airlines Corporation. Japan Airlines Corporation, Japan Airlines International Co., Ltd., and JAL Capital Co., Ltd., on January 19, 2010, filed the petitions to commenced corporate reorganization proceedings with the Tokyo District Court. The Court appointed the Enterprise Turnaround Initiative Corporation of Japan and Eiji Katayama, Esq., as reorganization trustees. Japan Airlines Corp. filed for reorganization January 19, 2010, in the Tokyo District Court and filed a Chapter 15 petition in New York (Bankr. S.D.N.Y. Case No. 10-10198). The Company estimated debts at $28 billion. JAPAN AIRLINES: May Seek Tie-Up Ventures With Cathay to Pare Costs ------------------------------------------------------------------ Chris Cooper and Kiyotaka Matsuda at Bloomberg News report that Japan Airlines Corp., set to begin a venture with American Airlines in April, may pursue similar tie-ups with Cathay Pacific Airways Ltd. and other Oneworld carriers to pare costs and offset route cuts made during restructuring. "We would like to have joint businesses with other Oneworld partners, such as Hong Kong's Cathay," JAL President Masaru Onishi told Bloomberg in an interview in Tokyo. American and Qantas Airways Ltd. are also members of the Oneworld group. According to Bloomberg, American said JAL and American will generate sales gains and cost-savings of about US$150 million annually after agreeing to share expenses and coordinate fares on 10 transpacific routes. Bloomberg notes that the cooperation may help Tokyo-based JAL maintain services as it scraps 49 routes by March and restructures operations under bankruptcy protection. "We have been shrinking our network as we reorganize,' Bloomberg quoted Mr. Onishi as saying. "With American, we may be able to keep that network or even expand it.' Tom Horton, president of American and its Fort Worth, Texas-based parent AMR Corp., told Bloomberg in an interview Tuesday that the venture, which covers routes including New York-Tokyo Haneda and Beijing-Chicago, will have annual sales of about $1.5 billion. The carriers expect to reach their target for sales gains and cost-savings next year, he said. The agreement may also lead to lower fares on some routes, the airlines said. About Japan Airlines Japan Airlines Corporation -- http://www.jal.co.jp/-- is a Japan-based company mainly engaged in the provision of air transport services. The Company is active in five business segments through its 203 subsidiaries and 83 associated companies. JAL International Co. Ltd. is a wholly owned operating subsidiary of Japan Airlines Corporation. Japan Airlines Corporation, Japan Airlines International Co., Ltd., and JAL Capital Co., Ltd., on January 19, 2010, filed the petitions to commenced corporate reorganization proceedings with the Tokyo District Court. The Court appointed the Enterprise Turnaround Initiative Corporation of Japan and Eiji Katayama, Esq., as reorganization trustees. Japan Airlines Corp. filed for reorganization January 19, 2010, in the Tokyo District Court and filed a Chapter 15 petition in New York (Bankr. S.D.N.Y. Case No. 10-10198). The Company estimated debts at $28 billion. =========== T A I W A N =========== AMERICAN INT'L: Ruentex Said to Lead Bidding for Nan Shan --------------------------------------------------------- Aries Poon, writing for Dow Jones Newswires, reports that a person familiar with the deal said Wednesday American International Group Inc. has chosen Taiwan's Ruentex Group as the preferred bidder for its Taiwan life-insurance unit, Nan Shan Life Insurance Co. Ruentex is a conglomerate with interests in textiles and real estate. The person said Ruentex offered more than US$2.15 billion, more than AIG could have fetched if it had been successful last year in selling Nan Shan to a consortium of Primus Financial Holdings Ltd. and Hong Kong-listed China Strategic Holdings Ltd.. As widely reported, Taiwan regulators blocked that deal in August 2010, citing concerns about China Strategic's financial strength and commitment to Nan Shan. Dow Jones says AIG's second attempt to sell the company also drew bids from Chinatrust Financial Holding Co., Cathay Financial Holding Co., Fubon Financial Holding Co. and a consortium made up of Primus, Taiwan Secom Co. and Goldsun Development & Construction Co. About AIG American International Group, Inc. -- http://www.aig.com/-- is an international insurance organization with operations in more than 130 countries and jurisdictions. AIG companies serve commercial, institutional and individual customers through one of the most extensive worldwide property-casualty networks of any insurer. In addition, AIG companies are leading providers of life insurance and retirement services around the world. AIG common stock is listed on the New York Stock Exchange, as well as the stock exchanges in Ireland and Tokyo. In September 2008, AIG experienced a liquidity crunch when its credit ratings were downgraded below "AA" levels by Standard & Poor's, Moody's Investors Service and Fitch Ratings. AIG almost collapsed under the weight of bad bets it made insuring mortgage- backed securities. The Company, however, was bailed out by the Federal Reserve, but even after an initial infusion of $85 billion, losses continued to grow. The later rescue packages brought the total to $182 billion, making it the biggest federal bailout in U.S. history. AIG has been working to protect and enhance the value of its key businesses, execute an orderly asset disposition plan, and position itself for the future. AIG has sold a number of its subsidiaries and other assets to pay down loans received from the U.S. government, and continues to seek buyers of its assets. ********* Tuesday's edition of the TCR-AP delivers a list of indicative prices for bond issues that reportedly trade well below par. Prices are obtained by TCR-AP editors from a variety of outside sources during the prior week we think are reliable. Those sources may not, however, be complete or accurate. The Tuesday Bond Pricing table is compiled on the Friday prior to publication. Prices reported are not intended to reflect actual trades. Prices for actual trades are probably different. Our objective is to share information, not make markets in publicly traded securities. Nothing in the TCR-AP constitutes an offer or solicitation to buy or sell any security of any kind. It is likely that some entity affiliated with a TCR-AP editor holds some position in the issuers' public debt and equity securities about which we report. A list of Meetings, Conferences and Seminars appears in each Wednesday's edition of the TCR-AP. Submissions about insolvency- related conferences are encouraged. Send announcements to conferences@bankrupt.com Friday's edition of the TCR-AP features a list of companies with insolvent balance sheets obtained by our editors based on the latest balance sheets publicly available a day prior to publication. At first glance, this list may look like the definitive compilation of stocks that are ideal to sell short. Don't be fooled. Assets, for example, reported at historical cost net of depreciation may understate the true value of a firm's assets. A company may establish reserves on its balance sheet for liabilities that may never materialize. The prices at which equity securities trade in public market are determined by more than a balance sheet solvency test. ********* S U B S C R I P T I O N I N F O R M A T I O N Troubled Company Reporter-Asia Pacific is a daily newsletter co- published by Bankruptcy Creditors' Service, Inc., Fairless Hills, Pennsylvania, USA, and Beard Group, Inc., Frederick, Maryland, USA. Valerie U. Pascual, Marites O. Claro, Joy A. Agravante, Rousel Elaine T. Fernandez, Psyche A. Castillon, Julie Anne G. Lopez, Ivy B. Magdadaro, Frauline S. Abangan, and Peter A. Chapman, Editors. Copyright 2011. All rights reserved. ISSN: 1520-9482. This material is copyrighted and any commercial use, resale or publication in any form (including e-mail forwarding, electronic re-mailing and photocopying) is strictly prohibited without prior written permission of the publishers. Information contained herein is obtained from sources believed to be reliable, but is not guaranteed. TCR-AP subscription rate is US$625 for 6 months delivered via e- mail. Additional e-mail subscriptions for members of the same firm for the term of the initial subscription or balance thereof are US$25 each. For subscription information, contact Christopher Beard at 240/629-3300. *** End of Transmission ***