/raid1/www/Hosts/bankrupt/TCRAP_Public/110713.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
Wednesday, July 13, 2011, Vol. 14, No. 137
Headlines
A U S T R A L I A
PLAYMORE GOLF: Receivers Put Two Golf Courses on the Market
REDGROUP RETAIL: Collins Booksellers Buys A&R Franchises
RESORT CORP: Receivers Sell Property for AUD3.15 Million
SA TALL SHIPS: Goes Into Liquidation
C H I N A
GELTECH SOLUTIONS: Still in Talks on FireIce Distribution Deal
H O N G K O N G
BRIDISCO (HK): Creditors' Proofs of Debt Due July 22
EXCEL WAY: Annual Meetings Set for July 15
FUNG'S INTERNATIONAL: General Meetings Slated for July 15
GOLDMEN ELECTRONIC: Creditors Get 100% Recovery on Claims
GRANDE HOLDINGS: July 25 Hearing Set for Chapter 15 Petition
GREAT SMART: Creditors' Proofs of Debt Due August 12
GLOAMING INVESTMENT: Creditors' Proofs of Debt Due July 29
GLOBE JOY: Members' Final General Meeting Set for August 9
HAGER METAL: Kong Chi How Johnson Appointed as Liquidator
KB INVESTMENT: Members' Final Meeting Set for August 10
KENFAIR PUBLICATIONS: Chuang Johnny Appointed as Liquidator
NATURAL POLYMER: Cheng James Yi-Ming Appointed as Liquidator
RYODEN INT'L: Members' Final General Meeting Set for August 10
I N D I A
BLR KNITS: ICRA Reaffirms '[ICRA]BB-' Rating on INR0.2cr Term Loan
DHANJI DEVELOPERS: ICRA Reaffirms [ICRA]B+ Rating on INR33cr Loan
FRIENDS AGRO: ICRA Assigns 'LB' Rating to INR7cr Bank Lines
H. R. TRADING: CRISIL Rates INR80 Million Cash Credit at 'B-'
JAINENDRA INDUSTRIES: CRISIL Assigns 'BB' Rating to INR21.3M Loan
JINDAL OVERSEAS: CRISIL Reaffirms BB Rating on INR50MM Cash Credit
LAKELAND CHEMICALS: ICRA Assigns 'LC' Rating to INR21.5cr Loan
MADHUR ENGINEERS: ICRA Rates INR6cr Cash Credit at '[ICRA]BB+'
MADHYA BHARAT: CRISIL Rates INR100 Million Cash Credit at 'BB'
MANISH BEARING: ICRA Rates INR6.5 Crore bank Limits at "[ICRA]B"
PURPLE MEDICAL: CRISIL Assigns 'BB-' Rating to INR12MM Term Loan
RAJENDRA EXIM: ICRA Assigns "[ICRA]B+" Rating to INR7cr Bank Loan
RESHMIKA MINERALS: CRISIL Upgrades Rating on INR120MM Loan to 'B'
RMZ GALLERIA: ICRA Assigns '[ICRA]BB+' Rating to INR225cr Loan
SANDHYA AQUA: CRISIL Reaffirms 'B+' Rating on INR18MM Term Loan
SHREE AMBAY: ICRA Assigns '[ICRA]B+' Rating to INR2cr LT Loan
SHREE HARI: ICRA Assigns '[ICRA]BB' Rating to INR34.50cr Limits
SOUTH INDIA: ICRA Assigns 'LBB-' Rating to INR25cr Term Loans
SRI SRINIVASA: ICRA Revises Rating on INR62.58cr Fund Based Loan
STERLING BIOTECH: ICRA Cuts Rating on INR790cr Loan to '[ICRA]C'
SWITCHGEARS & STRUCTURALS: ICRA Rates INR6.20cr Loan at '[ICRA]BB'
UNITED COKE: ICRA Reaffirms '[ICRA]BB-' Rating on INR5cr Loans
VINDHYACHAL HYDRO: ICRA Reaffirms '[ICRA]BB+' Rating on Term Loan
Y.S. INVESTMENTS: ICRA Assigns '[ICRA]BB-' Rating to INR4cr Limits
I N D O N E S I A
GAJAH TUNGGAL: Moody's Places 'B3' Ratings on Review
J A P A N
TAKEFUJI CORP: Court Rejects Bondholders Bid to Liquidate Firm
K O R E A
JEONBUK BANK: Moody's Reviews Ratings for Possible Downgrade
KOREA EXCHANGE: Lone Star Agrees to Cut Sale Price to KRW4.4-Tril.
N E W Z E A L A N D
BRIDGECORP LTD: Petricevic Loses Bid to Stay Criminal Proceedings
S I N G A P O R E
TWINS ENGINEERING: Court Enters Wind-Up Order
VINCI PTE: Court Enters Wind-Up Order
WEE CHONG: Court Enters Wind-Up Order
YODAI WINDOW: Court Enters Wind-Up Order
X X X X X X X X
* Moody's Says Spec-Grade Default Rate Ends at 2.2% in Q2 2011
* S&P's Global Corp. Default Tally Remains at 18 for 2011
* Upcoming Meetings, Conferences and Seminars
- - - - -
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A U S T R A L I A
=================
PLAYMORE GOLF: Receivers Put Two Golf Courses on the Market
-----------------------------------------------------------
goldcoast.com.au reports that a campaign has been launched to sell
Robina Woods and The Colonial Golf courses, both owned by Playmore
Golf, which went into receivership this year. However, both
units' futures as golf courses cannot be guaranteed.
Playmore Golf, owned by a syndicate headed by Sydney businessman
Danny Goldberg, bought the properties in 2003 for AUD12.5 million
from troubled US-based operator American Golf, goldcoast.com.au
discloses.
According to goldcoast.com.au, CB Richard Ellis's Mark Witheriff
and Paul Nyholt, with McVay Real Estate's Will and Sam McVay, will
steer the expressions of interest campaign with the properties
listed for sale under instruction from Joseph Hayes and Jamie
Harris from McGrathNicol as receivers and managers of Playmore
Golf.
The courses, notes goldcoast.com.au, are available in one line or
on a stand-alone basis, with expressions of interest closing
Aug. 11, 2011.
Robina Woods and The Colonial, formerly known as Paradise Springs,
are situated within a few kilometres of each other in the master-
planned residential community of Robina.
REDGROUP RETAIL: Collins Booksellers Buys A&R Franchises
--------------------------------------------------------
Madeleine Heffernan at SmartCompany reports that franchisee-owned
Collins Booksellers has snapped up a group of REDgroup-owned Angus
& Robertson franchises as well as flagging more purchases and
store openings in the next couple of months.
According to SmartCompany, Collins managing director Daniel Jordon
said an initial group of stores will move across to his company
immediately and Collins is continuing discussions with independent
stores and administrators about further acquisitions.
"The conversation is continuing," SmartCompany quotes Mr. Jordon
as saying.
The number of former A&R franchisees acquired by Collins is
unknown but it is believed to be in double digits, with prices for
the stores not disclosed, SmartCompany notes.
Smartcompany relates that Mr. Jordon said the company will be
unveiling an eBook offering via its stores and online and that the
purchased A&R stores are across Australia.
Collins has 52 stores and Mr. Jordon expects that number to grow
to more than 70 as the former A&R stores join and the company
opens new Collins stores.
About REDgroup Retail
REDgroup Retail Pty, with 260 stores and brands including Angus &
Robertson and Whitcoulls, is the largest book retailer in
Australia and New Zealand. It acquired Borders stores in
Australia, New Zealand, and Singapore in 2008.
* * *
REDgroup Retail Pty Ltd. on Feb. 17, 2011, named Steve Sherman,
John Melluish and John Lindholm of Ferrier Hodgson as voluntary
administrators. The board appointed Steve Sherman, John Melluish
and Ryan Eagle as voluntary administrators of the group's
New Zealand business on the same day. According to Bloomberg
News, the appointment comes less than a day after Borders Group
Inc. filed for bankruptcy in the U.S. and began taking bids for
200 stores.
The REDgroup companies in Administration include:
* REDgroup Retail Pty Ltd
* Spine Holdco Pty Ltd
* A&R Australia Holdings Pty Ltd
* REDgroup Retail Administrative Services Pty Ltd
* Whitcoulls Group Holdings Pty Ltd
* Spine Newco Pty Ltd
* Angus & Robertson Pty Ltd
* Angus & Robertson Bookworld
* Calendar Club Pty Ltd
* WGL Retail Holdings Ltd
* Whitcoulls Group Ltd
* Calendar Club New Zealand Ltd
* Borders New Zealand Ltd
* REDgroup Online Ltd
RESORT CORP: Receivers Sell Property for AUD3.15 Million
--------------------------------------------------------
Lucy Ardern at goldcoast.com.au reports that receivers picked up
another AUD3.15 million for Resort Corp creditors when a
Kingscliff property sold at auction on the weekend.
According to goldcoast.com.au, the sale price for the North Point
Ave site was about AUD300,000 above the reserve but still well
down on the AUD4.4 million the failed Gold Coast developer paid
for it in 2007.
The North Point Avenue site included a low-set architect-designed
home with an in-ground pool and synthetic tennis court and two
other beachfront blocks.
The property, goldcoast.com.au notes, was just one of a string
owned by Resort Corp, which had a development portfolio of homes
and land in NSW and Queensland worth AUD1.35 billion before
receivers seized control.
As reported in the Troubled Company Reporter-Asia Pacific on
June 9, 2011, goldcoast.com.au said receivers have seized control
of all remaining assets within the Resort Corp group following the
collapse of a deed of company arrangement (DOCA) put in place
almost two years ago. Under the DOCA, Gold Coast development duo
Paul Brinsmead and Peter Madrers were to undertake an orderly
sell-off of Resort Corp assets over 30 months to pay off
AUD300 million in loans owed to banks and mortgage funds.
The receivers, Greg Moloney and Will Colwell of Ferrier Hodgson,
were appointed by Capital Finance to take control of the Resort
Corp assets in April and they have now placed three properties
owned by the Gold Coast property group on to the market.
Australia based Resort Corp -- http://www.resortcorp.com.au/--
was established in 2001. The company was involved in luxury
beachside lifestyle developments.
SA TALL SHIPS: Goes Into Liquidation
------------------------------------
Portside Messenger reports that SA Tall Ships, the company that
ran the One And All training ship from Port Adelaide, has gone
into liquidation.
"The association has been in negotiations with the Department for
Transport, Energy and Infrastructure to agree on a revised charter
party agreement without success," Yorke Peninsula Country Times
quotes liquidator Heard Phillips Chartered Accountants director
Anthony Phillips as saying.
"Faced with some longer-term trade creditors and with no
guaranteed income after June 30, without a charter party
agreement, SATS had no option but to cease trading and appoint
liquidators.
"Fourteen staff had their employment terminated by the closure of
the SATS business; however, numerous staff have been re-employed
to assist DTEI with the current refit program for the ship,"
Mr. Phillips said.
The company's operations manager Peter Roberts has been engaged by
the State Government to oversee the ship's annual maintenance
program, while it goes through a tender process to find a new
operator, according to Portside Messenger.
SA Tall Ships has managed the One And All training ship since
April 2005 and ran youth development programs.
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C H I N A
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GELTECH SOLUTIONS: Still in Talks on FireIce Distribution Deal
--------------------------------------------------------------
GelTech Solutions, Inc., disclosed in April about a proposed
letter of intent with a Chinese company to serve as exclusive
distributor of FireIce and Skin Armor in China for a 10-year
period.
GelTech related in a new Form 8-K filing with the U.S. Securities
and Exchange Commission that no letter of intent has been
executed, although the Company continues its discussions with the
proposed distributor. An issue has risen with regard to the
current Chinese distributor, which has the exclusive rights to
distribute FireIce in China.
The Company initially sought to have the proposed new distributor
and the current distributor act together, which would have
accelerated the ability to execute the contract. The current
distributor has not been able to come to terms with the new
distributor or the Company.
Accordingly, the Company recently gave notice to the current
distributor terminating the agreement, which requires a 30-day
cure period. The current distributor has the opportunity to
remedy by becoming current on its minimum purchase commitment of
US$5,360,000. If it does not, the agreement will be terminated
and the Company can finalize negotiations with the proposed new
distributor.
The Company estimates that it will take at least until September
2011 before it can receive new permits from the Chinese
government.
About GelTech Solutions
Jupiter, Fla.-based GelTech Solutions. Inc. (OTC Bulletin Board:
GLTC) -- http://www.GelTechsolutions.com/-- is a Delaware
corporation organized in 2006. The Company creates innovative,
Earth-friendly, cost-effective products that help industry,
agriculture, and the general public accomplish environmental and
safety goals, such as water conservation and the protection of
lives, homes, and property from fires. The Company's current
business model is focused on the following products: 1)
FireIce(R), a fire suppression product, 2) SkinArmor(TM), an
ointment used for protecting skin from direct flame and high
temperatures, and 3) Soil2O(TM), a line of agricultural moisture
retention products.
The Company's balance sheet at March 31, 2011, showed US$933,598
in total assets, US$1.44 million in total liabilities and a
US$508,047 total stockholders' deficit.
Going Concern Doubt
As reported in the Troubled Company Reporter on Oct. 4, 2010,
Salberg & Company, P.A., in Boca Raton, Fla., expressed
substantial doubt about GelTech's ability to continue as a
going concern, following the Company's results for the fiscal year
ended June 30, 2010.
In the Form 10-Q, GelTech noted that as of Dec. 31, 2010, it
had a working capital deficit of US$1,949,478, had an accumulated
deficit and stockholders' deficit of US$12,412,626 and
US$1,787,641, respectively, and incurred losses from operations of
US$2,568,513 for the six months ended Dec. 31, 2010 and used cash
from operations of US$1,632,695 during the six months ended
Dec. 31, 2010. In addition, the Company has not yet generated
revenue sufficient to support ongoing operations.
GelTech said its continuation as a going concern is dependent on
the continued financial support from its stockholders, its ability
to obtain necessary debt or equity financing to continue
operations, and the attainment of profitable operations.
================
H O N G K O N G
================
BRIDISCO (HK): Creditors' Proofs of Debt Due July 22
----------------------------------------------------
Creditors of Bridisco (Hong Kong) Limited, which is in creditors'
voluntary liquidation, are required to file their proofs of debt
by July 22, 2011, to be included in the company's dividend
distribution.
The company's liquidators are:
Roderick John Sutton
Fok Hei Yu
c/o FTI Consulting (Hong Kong) Limited
14/F The Hong Kong Club Building
3A Chater Road
Central, Hong Kong
EXCEL WAY: Annual Meetings Set for July 15
------------------------------------------
Creditors and members of Excel Way Investments Limited will hold
their annual meetings on July 15, 2011, at 3:00 p.m., at the
offices of FTI Consulting (Hong Kong) Limited, 14th Floor, The
Hong Kong Club Building, 3A Chater Road, Central, in Hong Kong.
At the meeting, Fok Hei Yu, the company's liquidator, will give a
report on the company's wind-up proceedings and property disposal.
FUNG'S INTERNATIONAL: General Meetings Slated for July 15
---------------------------------------------------------
Contributories and creditors of Fung's International Limited will
hold their meetings on July 15, 2011, at 2:00 p.m., and 2:30 p.m.,
respectively at 29th Floor, Caroline Centre, Lee Gardens Two, at
28 Yun Ping Road, in Hong Kong.
At the meeting, Wong Tak Man Stephen, the company's liquidator,
will give a report on the company's wind-up proceedings and
property disposal.
GOLDMEN ELECTRONIC: Creditors Get 100% Recovery on Claims
---------------------------------------------------------
Goldmen Electronic Company Limited, which is in liquidation,
declared dividend to its creditors on June 30, 2011.
The company paid 100% for preferential and 8% for ordinary claims.
The company's liquidators are:
Messrs. Lai Kar Yan (Derek)
Darach E. Haughey
32nd Floor, One Pacific Place
88 Queensway, Hong Kong
GRANDE HOLDINGS: July 25 Hearing Set for Chapter 15 Petition
------------------------------------------------------------
Judge Robert E. Gerber will convene a hearing for July 25, 2011,
at 9:45 a.m., to consider the request of Fok Hei Yu and Roderick
John Sutton, provisional liquidators of The Grande Holdings
Limited, for entry of an order recognizing the liquidation of
Grande Holdings in the High Court of Hong Kong as a "foreign main"
proceeding pursuant to Section 1517 of the Bankruptcy Code.
The liquidators asserted that Hong Kong is the "center of main
interests" for Grande Holdings as defined by Sections 1502(4),
1516(c) and 1517(b)(1) of the Bankruptcy Code.
On May 27, 2011, Sino Bright Enterprises Co., Ltd., sent a demand
letter to Grande Holdings with regards to an outstanding loan
balance. The demand letter put Grande Holdings on notice that it
was required to pay the entire balance of the loan within 21 days,
which amounted to US$238,978,462 (HK$1,859,754,567) on May 31,
2011. On the same day, Grande Holdings responded in affirmation
of the demand, stating it agreed that the entire balance was due
but that it would be unable to pay the obligation due to the its
current liquidity status. Sino Bright then presented a petition
to the Hong Kong Court, seeking the immediate wind-up of Grande
and a request to appoint provisional liquidators. On May 31,
2011, the Hong Kong Court appointed Messrs. Yu and Sutton as
provisional liquidators.
Grande Holdings was also named as a defendant in an alter-ego
lawsuit brought by shareholders of MTC Electronics to enforce the
judgment obtained in a previously decided shareholder suit against
MTC, which at that time was owned by Grande Holdings. This case,
which was brought in the Superior Court for the State of
California, the County of Los Angeles, Kayne v. Grande Holdings
Limited, Case No: BC 363764, resulted in a statement of decision
holding that Grande Holdings was liable under an alter ego theory
in the amount of US$37,562,122.
A related federal case, based on the underlying state claim is
currently pending in the U.S. District Court for the Central
District of California (Western Division), Kayne v. Christopher
Ho, et al, Case No.: 2:09-cv-06816-JAK-CW. The allegations undr
the complaint state that (1) Grande Holdings is liable as an
alter-ego for the original judgment against MTC; (2) Grande
Holdings fraudulently conveyed certain assets to avoid attachment
of a potential judgment on those assets; (3) Grande Holdings
violated the Federal RICO statutes.
About Grande Holdings
The Grande Holdings Limited is an investment holding company,
holding shares and equity interests in various groups of
companies. The principal activities of Grande's subsidiaries
consist of distribution of household appliances and consumer
electronic products and licensing of trademarks. Grande and its
subsidiary companies own three global brands -- Nakamichi, Akai
and Sansui -- which are recognized for their wide range of audio-
visual equipment, consumer electronics and digital products. The
products are distributed through its global network spanning Asia,
Africa, Europe, Oceania, the Middle East and the Americas.
Grande Holdings was originally incorporated in the Cayman Islands
on Sept. 5, 1990, but was discontinued and resumed under the laws
of Bermuda. Grande has been registered in Hong Kong under Part XI
of the Companies Ordinance, Chapter 32 of the Laws of Hong Kong,
and has its principal place of business at 12th Floor, The Grande
Building, 398-402 Kwun Tong Road, in Kowloon.
Fok Hei Yu and Roderick John Sutton, as provisional liquidators of
Grande Holdings, filed a petition under Chapter 15 of the U.S.
Bankruptcy Code (Bankr. S.D.N.Y. Case No. 11-13119) on June 28,
2011, estimating $100 million to $500 million in assets and debts
for Grande. The petitioners are represented by:
Gerald C. Bender, Esq.
Daniel S. Shamah, Esq.
Jason A. Zimmerman, Esq.
O'MELVENY & MYERS LLP
7 Times Square
New York, NY 10036
Tel: 212-326-2000
Fax: 212-326-2061
Email: dshamah@omm.com
gbender@omm.com
GREAT SMART: Creditors' Proofs of Debt Due August 12
----------------------------------------------------
Creditors of Great Smart Trading Limited, which is in members'
voluntary liquidation, are required to file their proofs of debt
by Aug. 12, 2011, to be included in the company's dividend
distribution.
The company commenced wind-up proceedings on June 27, 2011.
The company's liquidator is:
Chan Kuok Kun
5/F, Mirror Tower
61 Mody Road
Tsimshatsui East
Kowloon, Hong Kong
GLOAMING INVESTMENT: Creditors' Proofs of Debt Due July 29
----------------------------------------------------------
Creditors of Gloaming Investment Limited, which is in members'
voluntary liquidation, are required to file their proofs of debt
by July 29, 2011, to be included in the company's dividend
distribution.
The company commenced wind-up proceedings on June 30, 2011.
The company's liquidators are:
Ying Hing Chiu
Chan Mi Har
Level 28, Three Pacific Place
1 Queen's Road East
Hong Kong
GLOBE JOY: Members' Final General Meeting Set for August 9
----------------------------------------------------------
Members of Globe Joy Limited will hold their final general meeting
on Aug. 9, 2011, at 11:30 a.m., at 19th Floor, Cameron Commercial
Centre, 468 Hennessy Road, in Hong Kong.
At the meeting, Lau Hin Chi, the company's liquidator, will give a
report on the company's wind-up proceedings and property disposal.
HAGER METAL: Kong Chi How Johnson Appointed as Liquidator
---------------------------------------------------------
Kong Chi How Johnson on June 27, 2011, was appointed as liquidator
of Hager Metal and Plastic Works Limited.
The liquidator may be reached at:
Kong Chi How Johnson
25th Floor, Wing On Centre
111 Connaught Road
Central, Hong Kong
KB INVESTMENT: Members' Final Meeting Set for August 10
-------------------------------------------------------
Sole Member of KB Investment & Securities Hong Kong Limited will
hold a final meeting on Aug. 10, 2011, at 5:00 p.m., at 19A
Entertainment Building, 30 Queen's Road Central, in Hong Kong.
At the meeting, Tang Tin Sek, the company's liquidator, will give
a report on the company's wind-up proceedings and property
disposal.
KENFAIR PUBLICATIONS: Chuang Johnny Appointed as Liquidator
-----------------------------------------------------------
Chuang Johnny on June 29, 2011, was appointed as liquidator of
Kenfair Publications Limited.
The liquidator may be reached at:
Chuang Johnny
23/F, Exchange Tower
33 Wang Chiu Road
Kowloon Bay, Kowloon
Hong Kong
NATURAL POLYMER: Cheng James Yi-Ming Appointed as Liquidator
------------------------------------------------------------
Cheng James Yi-Ming on June 28, 2011, was appointed as liquidator
of Natural Polymer International (HK) Limited.
The liquidator may be reached at:
Cheng James Yi-Ming
22/F, Hang Lung Centre
2-20 Paterson Street
Causeway Bay, Hong Kong
RYODEN INT'L: Members' Final General Meeting Set for August 10
--------------------------------------------------------------
Members of Ryoden International Trade Limited will hold their
final general meeting on Aug. 10, 2011, at 10:30 a.m., at 11/F,
169 Electric Road, North Point, in Hong Kong.
At the meeting, Kwok-leung Yeung, the company's liquidator, will
give a report on the company's wind-up proceedings and property
disposal.
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I N D I A
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BLR KNITS: ICRA Reaffirms '[ICRA]BB-' Rating on INR0.2cr Term Loan
------------------------------------------------------------------
ICRA has re-affirmed the '[ICRA]BB-' rating assigned to the
INR0.20 crore term loan facilities and the INR3.25 crore fund
based facilities of BLR Knits Private Limited. The outlook on the
long term rating is stable. ICRA has also reaffirmed the
'[ICRA]A4' rating to the INR0.21 crore short term non-fund based
facility of BLRK.
The re-affirmation of the ratings assigned to BLR Knits Private
Limited has favorably factored in the significant experience of
the promoters in the fabric and garmenting business; the presence
of reputed apparel brands in the customer portfolio; the
operational and financial support extended by the group companies
involved in similar lines of business and the small direct retail
presence through its own brand "Rattrap". The rating also
considers the company's relatively small scale of operations,
which restricts its economies of scale and financial flexibility;
weak financial profile, as characterized by moderately high
gearing levels of 1.7 times as on March 31, 201; increasing
working capital intensity and low accruals. The margins of the
company are vulnerable to fluctuations in raw material prices and
exchange rates, as it is difficult for the company to pass on
input cost increases, given the heavy competition prevalent in the
highly fragmented textile industry. In addition, the industry
faces severe competition from countries with lower cost of
production and relatively less fluctuations in exchange rates.
About BLR Knits
BLR Knits Private Limited is a closely-managed business engaged in
the manufacture of knitted fabric and ready-made garments (RMG) .
The Company currently has its manufacturing facilities at
Bangalore with estimated garmenting capacities of 7,000 kg fabric
per day and stitching capacities of 6,000 pieces per day. Ready-
made garments' sales form the bulk of the company's revenues (76%
in 2010-11, including domestic and exports), with the product
profile broadly comprising T-shirts; sweat shirts, sportswear, and
nightwear. The company primarily caters to domestic brands/
retailers (around 37% of revenues in 2010-11) like V.F. Arvind
Brands, and Lifestyle International. The company exports its
product to European countries primarily to France and Germany
(around 30% of revenues in 2010-11). Contract work undertaken for
knitting and garmenting and the sale of its own retail brand
"Rattrap" contribute to the rest of the revenues.
DHANJI DEVELOPERS: ICRA Reaffirms [ICRA]B+ Rating on INR33cr Loan
-----------------------------------------------------------------
ICRA has reaffirmed the '[ICRA]B+' rating to the INR33.75 crore
term loans of Dhanji Developers.
The rating reaffirmation reflects the benefits accrued for the
firm on account of strategic investments in Kohinoor City Mall
over the past two years. The firm's investment in windmill power
generation, to gain tax benefits on higher depreciation, has lead
to creation of a steady revenue stream for the firm. The rating is
however constrained by the stretched capital structure and
liquidity of the firm characterized by weak debt and interest
servicing indicators. The firm relies on advances from customers
to fund on-going construction activity. However, on account of
unfavorable macroeconomic factors affecting growth in sales tied-
up to the commercial projects and advances against bookings not
keeping pace with the construction activity, the firm has resorted
to unsecured loans to overcome cash flow mismatches. Concurrently,
ICRA has also observed delays in project execution, which are
likely to impact overall profitability of projects undertaken as
interest expense on funds attached rises.
About Dhanji Developers
Dhanji Developers is a sole proprietorship firm of Mr. Dhanji
Gala. It is involved in real estate development since the year
2001 and has completed six residential projects in Matunga area in
Mumbai city. The company is involved in redevelopment of old
buildings and has been predominantly involved with residential
projects. However, recently the company has increased its focus on
development of commercial space. The company is currently involved
in three projects in Mumbai - a Slum Rehabilitation (SRA) project,
a commercial project and a residential cum commercial project. The
company has also invested in windmills in March 2009 to achieve
tax benefits of higher depreciation of the same.
Recent Results
For the twelve months ending March 31, 2011 (as per provisional
financial results), DD reported profit after tax (PAT) of
INR0.9 crore on an operating income of INR10.8 crore as compared
to a profit of INR1.1 crore on an operating income of
INR21.8 crore for the twelve months ending March 31, 2010.
FRIENDS AGRO: ICRA Assigns 'LB' Rating to INR7cr Bank Lines
-----------------------------------------------------------
ICRA has assigned a long-term rating of 'LB' to the INR7.0 crore
bank lines of Friends Agro Industries.
The rating of FAI takes into consideration its modest scale of
operations; its high gearing levels and modest debt protection
indicators. The rating also factors in the low entry barriers and
intensely competitive nature of industry which makes margins and
cash flows vulnerable to fluctuations in prices. The rating is
also constrained by high working capital intensity of business and
the risks inherent in a partnership firm. However, the rating
favorably takes into account the firm's experienced management and
its proximity to raw material sources. Further, ICRA also takes
into account the favorable demand prospects of the industry with
India being the second largest producer and consumer of rice in
the world.
Friends Agro Industries is a partnership firm established in
January 2010 with Mr. Gaurav Aneja, Mr. Sandeep Aneja, Mr. Vipin
Kumar and Mr. Vikram Kumar as partners. The firm is involved in
the milling and processing of basmati and non basmati rice and is
based out of Jalalabad, Punjab. The partners purchased the mill
and installed a sortex machine to manufacture and sell a value
added product.
During the financial year ending March 31, 2010, the firm reported
a net loss before tax of INR0.01 crore on an operating income of
INR0.02 crore in the first 2-3 months of operations.
H. R. TRADING: CRISIL Rates INR80 Million Cash Credit at 'B-'
-------------------------------------------------------------
CRISIL has assigned its 'B-/Negative' rating to the cash credit
facility of H. R. Trading Co.
Facilities Ratings
---------- -------
INR80 Million Cash Credit B-/Negative (Assigned)
The rating reflects HRT's weak financial risk profile, marked by a
modest net worth, high gearing, and weak debt protection metrics
and susceptibility of its business risk profile and profitability
to changes in government policy on cotton. These rating weaknesses
are partially offset by the extensive experience of promoter in
cotton industry.
Outlook: Negative
CRISIL believes that HRT's credit profile over the near term will
be constrained by volatility in cotton prices against the backdrop
of significant inventory build-up as at March, 2011. The ratings
may be downgraded if HRT posts an operating performance in terms
of revenues and profitability, significantly below CRISIL's
expectation, thereby further weakening its financial risk profile.
Conversely, the outlook may be revised to 'Stable' if there is a
significant increase in revenues and profitability coupled with a
material improvement in the financial metrics by way of infusion
of promoters funds to reduce a part of the debt burden.
About H. R. Trading
Established in 1999, HRT is a proprietorship concern of Mr.
Harikishan Rathi. HRT is engaged in cotton ginning and processing
of cotton oil and cotton cake. The company sells the cotton bales
to various traders while the cotton seeds are sold to various oil
mills in the plant's vicinity. The concern's manufacturing unit is
located at Amravati (Maharashtra) with an installed capacity of
producing 300 bales per day.
HRT reported a profit after tax (PAT) of INR0.7 million on net
sales of INR259.2 million reported on provisional basis for
2010-11 (refers to financial year, April 1 to March 31), as
against a PAT of INR1.1 million on net sales of INR237.4 million
for 2009-10.
JAINENDRA INDUSTRIES: CRISIL Assigns 'BB' Rating to INR21.3M Loan
-----------------------------------------------------------------
CRISIL has assigned its 'BB/Stable/P4+' ratings to the bank
facilities of Jainendra Industries Pvt Ltd.
Facilities Ratings
---------- -------
INR21.3 Million Rupee Term Loan BB/Stable (Assigned)
INR97.7 Million Cash Credit BB/Stable (Assigned)
INR11.0 Mil. Standby Line of Credit BB/Stable (Assigned)
INR20.0 Million Letter of Credit P4+ (Assigned)
The ratings reflect JIPL's average financial risk profile, marked
by moderate gearing and debt protection measures and small net
worth, susceptibility to customer concentration in revenues and
small scale of operations in the fragmented automotive and
electrical components industry. These rating weaknesses are
partially offset by an established customer base and extensive
experience of JIPL's promoters in the industry.
Outlook: Stable
CRISIL believes that JIPL will continue to benefit from the
extensive industry experience of its promoters and established
customer base, over the medium term. The outlook may be revised to
'Positive' if JIPL scales up its operations significantly while
maintaining its financial risk profile. Conversely, the outlook
may be revised to 'Negative' if JIPL's profitability declines or
in case of deterioration in financial risk profile due to larger-
than-expected debt-funded capital expenditure.
About Jainendra Industries
Set up in 1994 as Gupta Color Tech Pvt Ltd, JIPL was taken over
and renamed by the existing promoters in 1996. The company has a
die casting unit, mainly aluminium, for manufacturing automotive
and electrical components. Its plant in Faridabad (Haryana) has 15
machines of varied capacities, and a total processing capacity of
7500 tonnes.
JIPL's product base comprises brake levers, clutch shoes, brake
systems, regulator flashes, clutch plates, and brake shoe lining--
mainly for tractors, and components of electronic appliances such
as electric motors, generators, water purifiers, air conditioners,
and sewing machines.
JIPL reported a profit after tax (PAT) of INR22.2 million on net
sales of INR356.7 million for 2009-10 (refers to financial year,
April 1 to March 31), as against a PAT of INR1.9 million on net
sales of INR273.8 million for 2008-09.
JINDAL OVERSEAS: CRISIL Reaffirms BB Rating on INR50MM Cash Credit
------------------------------------------------------------------
CRISIL's ratings on the bank facilities of Jindal Overseas
Corporation continues to reflect Jindal Overseas's exposure to
intense competition in the agricultural (agro) commodities trading
business and to adverse changes in government regulations, and the
firm's small net worth and scale of operations. These rating
weaknesses are partially offset by Jindal Overseas's established
position in the agro commodities trading business backed by its
promoters' extensive experience.
Facilities Ratings
---------- -------
INR50 Million Cash Credit (Enhanced BB/Stable
from INR40 Million)
INR250 Million Letter of Credit and Bank P4+
Guarantee (Enhanced from INR110 Million)
Outlook: Stable
CRISIL believes that Jindal Overseas will continue to benefit over
the medium term from its promoter's extensive experience. The
outlook may be revised to 'Positive' if there is a sustained
improvement in the firm's profitability and net worth. Conversely,
the outlook may be revised to 'Negative' if Jindal Overseas's
financial risk profile deteriorates steeply, most likely because
of large withdrawals from the firm's capital account or large,
debt-funded capital expenditure.
Update
Jindal Overseas has registered a healthy year-on-year sales growth
of 33% in 2010-11 (refers to financial year, April 1 to March 31).
The growth in sales was primarily driven by higher demand in the
domestic market. Over the medium term, Jindal Overseas's sales
growth is likely to moderate to close to 10% because of
expectations of high domestic output in India which adversely
affect sales of importers such as Jindal. Although the growth in
sales was higher than CRISIL's expectation, the firm's
profitability was lower than expectation because of volatility in
commodity prices. Due to the trading nature of Jindal Overseas'
operations, the company's profitability is expected to remain low
over the medium term.
Jindal Overseas reported a profit after tax (PAT) of INR5.78
million on net sales of INR732 million for 2010-11, against a PAT
of INR5.75 million on net sales of INR552 million for 2009-10.
About the Firm
Set up as a partnership firm in 1986, Jindal Overseas was
reconstituted as a proprietorship firm in 2007. The firm is
managed by Mr. Pradeep Kumar Jindal and it trades in varieties of
pulses including rajma, chana, and masoor dal.
LAKELAND CHEMICALS: ICRA Assigns 'LC' Rating to INR21.5cr Loan
--------------------------------------------------------------
ICRA has assigned an 'LC' rating to INR21.50 crore Cash credit
fund based facilities and an LC rating to INR17.99 crore Term Loan
fund based facilities of Lakeland Chemicals India Limited. ICRA
has also assigned an A5 rating to the INR0.50 crore non-fund-based
bank facilities of LCIL.
The assigned ratings are constrained by the company's weak capital
structure and strained liquidity position as reflected by delays
in servicing the debt in the past six months. The high working
capital intensive nature of operations and low accruals has
affected the liquidity position of the company. The ratings also
takes into consideration the limited improvement in key credit
metrics in the near to medium term likely because of high
proportion of debt in the proposed capacity expansion programme.
ICRA notes that LCIL is also exposed to fluctuations in raw
material prices given the long inventory holding period, which are
linked to the volatile crude prices. The ratings, however,
favorably factor in long track record of the promoters in the
chemical industry, established product portfolio, and the
technical collaboration with Textilchemie Dr. Petry GMBH, Germany
which provides support in developing new products.
About Lakeland Chemicals
Incorporated in the year 2004, Lakeland Chemicals India Limited,
was established as a joint venture between Lakeland laboratories
Limited, Manchester UK and professionals having experience in the
chemical industry. LCILs manufacturers specialty and semi-
specialty products which find usage in textile, explosives,
cosmetics, food processing, health and personal care, paints,
emulsion polymerization, pigments, metal cleaning, metal working,
lubricants, oil fields, agricultural, pesticides industries.
Operating out of a single location, the company's total
manufacturing capacity is 17500TPA and has been able to maintain
high utilization levels.
Recent results:
During the nine month period April to December 2010, the company
reported net profit of INR1.57 crore on a turnover of INR67 crore.
MADHUR ENGINEERS: ICRA Rates INR6cr Cash Credit at '[ICRA]BB+'
--------------------------------------------------------------
ICRA has assigned the '[ICRA]BB+' rating to the INR6 crore fund
based cash credit facilities of Madhur Engineers Private Limited.
The outlook on the long term rating is stable. ICRA has also
assigned the '[ICRA]A4+' rating to the INR4.0 crore fund based
limits of MEPL.
The assigned ratings are supported by the long standing experience
of the promoters in steel manufacturing and trading and MEPL's
moderate capital structure. The ratings also favorably factor in
the established relationship of MEPL with JSW Steel which ensures
steady access to raw material at competitive prices. The ratings
are however constrained by MEPL's modest scale of operations,
client concentration risks thereof and the limited value addition
inherent to trading business wherein margins are almost entirely
driven by discounts availed from suppliers. ICRA notes that while
MEPL's margins are relatively isolated from fluctuation in steel
prices given its practice of carrying out trading on a transit
basis, growth in cash accruals over the near term is expected to
remain sensitive to realization of certain disputed receivables.
As such the trading business is inherently working capital
intensive wherein fund flow from operations and hence the
liquidity position of the company remains sensitive to its
receivables cycle. MEPL also plans to incur a capex of over
INR3.0 crore towards the expansion of its stockyard located in
Alandi, Pune which is likely to put pressure on the company's free
cash flow position. ICRA also notes that a significant portion of
the tangible net worth of MEPL (approximately 40%) is presently
blocked in non-yielding investments resulting in continued
dependence on working capital debt to finance its operations.
About Madhur Engineers
Madhur Engineers Private Limited is a trader of special purpose
carbon /alloy steel and bright bars. The company purchases steel
from players such as JSW Steel and Facor Steel and supplies it to
forging and machining companies located in the state of
Maharashtra. The company also operates a dedicated warehouse for
JSW to store steel inventory for all the steel to be sold in the
state of Maharashtra. The warehouse is spread across an area of
1.25 lakh square feet.
Recent Results
As per the company's provisional results for the year ending
March 31, 2011, MEPL recorded an operating income of INR58.38
crore and a PBT of INR2.76 crore as against an operating income
of INR32.97 crore and a PAT of INR1.09 crore for the 12 months
ending March 31, 2010.
MADHYA BHARAT: CRISIL Rates INR100 Million Cash Credit at 'BB'
--------------------------------------------------------------
CRISIL has assigned its 'BB/Stable' rating to the cash credit
facility of Madhya Bharat Phosphate Pvt Ltd.
Facilities Ratings
---------- -------
INR100 Million Cash Credit BB/Stable (Assigned)
The rating reflects MBPPL's weak financial risk profile driven by
working-capital-intensive operations, high product and customer
concentration in revenue profile, and susceptibility to changes in
government regulations and to erratic rainfall. These rating
weaknesses are partially offset by the benefits that MBPPL derives
from its promoter's extensive experience in the fertilizer
industry and its established relationship with, and funding
support from, its key customer.
Outlook: Stable
CRISIL believes that MBPPL's financial risk profile will remain
constrained by the working-capital-intensive nature of the
company's operations, over the medium term. The outlook may be
revised to 'Positive' if MBPPL's financial risk profile improves
considerably driven by more-than-expected cash accruals or
improved working capital management. Conversely, the outlook may
be revised to 'Negative' in case of any significant pressure on
MBPPL's cash accruals because of any unfavorable change in
Government of India's single super phosphate (SSP) concession
policy or relationship with its key customer.
About Madhya Bharat
MBPPL was incorporated in 1998 as a private limited company named
Omni Seeds and Farms (India) Pvt Ltd by Mr. Pawan Agrawal; it got
its current name in 2003. The company manufactures fertilizers,
mainly SSP. MBPPL has two manufacturing facilities in Raisen and
Meghnagar (both in Madhya Pradesh) with aggregate capacity of 0.2
million tonnes per annum.
MBPPL reported a profit after tax (PAT) of INR11 million on net
sales of INR331 million for 2009-10 (refers to financial year,
April 1 to March 31), against a PAT of INR10 million on net sales
of INR283 million for 2008-09.
MANISH BEARING: ICRA Rates INR6.5 Crore bank Limits at "[ICRA]B"
----------------------------------------------------------------
ICRA has assigned an "[ICRA]B" rating to the INR6.5 Crore, bank
limits of Manish Bearing Enterprise.
The rating is constrained by the relatively modest scale of
operations for the firm; its limited geographical diversification,
as reflected by significantly high revenue concentration (over 80%
in FY 11) towards the National Capital region and weak
profitability indicators. The rating is also constrained on
account of the highly working capital intensive nature of its
operations, which in turn necessitates higher working capital
borrowings. In addition, the limited net worth (owing to weak
profitability and accruals) of the company has resulted in its
overall weak financial profile and debt coverage indicators. While
assigning the rating, ICRA has also taken into account the risk
arising out of MBE being constituted as a partnership firm. The
rating, nevertheless, takes comfort from the significant business
experience of the promoters.
Manish Bearing Enterprises was incorporated as a partnership firm
in the year 1977. The firm is promoted by Mr. Krishna Kumar Saboo
and his brother Mr. Subash Chandra Saboo. Both the brothers hold a
50%stake each in the firm and are actively involved in its day-to-
day business operations. Manish Bearing Enterprises is one of the
SKF Authorized Industrial Distributor in northern India. It has
its offices in Delhi, Gurgaon, Bhiwandi and Kanpur. The firm
initially started trading in all types of bearings and gradually
moved to deal exclusively in SKF.
Recent Results
For the 12 months period ending March 31, 2011, Manish Bearing
Enterprises reported a provisional profit after tax (PAT) of
INR0.15 Crore on revenues of INR30.04 Crore as against a PAT of
INR0.05 Crore on revenues of INR24.99 Crore for the twelve months
period ending March 31, 2010.
PURPLE MEDICAL: CRISIL Assigns 'BB-' Rating to INR12MM Term Loan
----------------------------------------------------------------
CRISIL has assigned its 'BB-/Stable' rating to the bank facilities
of Purple Medical Solutions Private Ltd, part of the Purple
group).
Facilities Ratings
---------- -------
INR12 Million Term Loan BB-/Stable (Assigned)
INR25 Million Proposed Cash Credit Limit BB-/Stable (Assigned)
INR45 Million Cash Credit BB-/Stable (Assigned)
INR138 Million Proposed Term Loan BB-/Stable (Assigned)
The rating reflects PMSPL's average financial risk profile, which
is expected to deteriorate on account of PMSPL's proposed debt-
funded acquisition of MIV Therapeutics India Ltd, and the risks
associated with integration and turnaround of MIVTI's operations.
These weaknesses are partially offset by the benefits that PMSPL
derives from the experience of the Purple group's promoters in the
healthcare industry, and from the group's established presence in
the coronary stent segment.
For arriving at its ratings, CRISIL has consolidated the business
and financial risk profiles of PMSPL and MIVTI, together referred
to as the Purple group. This is because PMSPL is in the process of
acquiring MIVTI, and the two entities will have a common
management; MIVTI will operate as the manufacturing arm, and PMSPL
as the distribution arm, for stents in India.
Outlook: Stable
CRISIL believes that the proposed acquisition of MIVTI will help
PMSPL integrate backwards into manufacturing, and thus strengthen
its business risk profile. However, the leveraged transaction will
constrain PMSPL's financial risk profile, and therefore, its
credit risk profile, over the medium term. The outlook may be
revised to 'Positive' if PMSPL benefits from the synergies of the
acquisition as envisaged, and successfully turns around MIVTI's
operations. The outlook may be revised to 'Negative' if the group
fails to derive benefits from the MIVTI acquisition, or if its
profitability fails to pick up, thus adding to the pressure on the
group's financial risk profile.
About Purple Medical
Established in August 2007, PMSPL distributes coronary stents and
related accessories that are used in coronary angioplasty. PMSPL
began operations in April 2008, as the nationwide distributor for
MIVTI, and is the sole India distributor for the company. MIVTI is
a subsidiary of MIV Therapeutics Inc, Canada, which is primarily a
research and development company focused on biocompatible stent
coatings for implantable devices and drug deliveries.
PMSPL was constituted by five friends-Mr. Brian Lancelot,
Mr. Praneet Sharma, Mr. Mathew Thomas, Mr. Murli Bendele and
Mr. Rajesh Shrivas, who, prior to setting up PMSPL, led business
and operations for leading medical device manufacturers in India.
PMSPL's list of 80-90 customers has leading hospitals including
Dr. Hiranandani Hospital, Jaslok Hospital, and Surana Hospital
(Mumbai), Jahangir Hospital (Pune), and Apollo Hospital
(Ahmedabad).
PMSPL, on a provisional basis, reported a profit after tax (PAT)
of INR13.5 million on an operating income of INR288 million for
2010-11 (refers to financial year, April 1 to March 31), as
against a PAT of INR6.8 million on an operating income of INR180
million for 2009-10.
RAJENDRA EXIM: ICRA Assigns "[ICRA]B+" Rating to INR7cr Bank Loan
-----------------------------------------------------------------
ICRA has assigned "[ICRA]B+/[ICRA]A4" ratings for the INR7.0 crore
bank facilities of Rajendra Exim Private Limited.
The ratings take into account small scale of operations of the
company, large fluctuations in revenues from textile business
during last three years and high customer concentration in the
yarn export business. The scale of operations of the company
remains small, with operating income of INR3.4 crore in FY11. The
company's textile business was severely affected due to the ban on
yarn exports in FY11 resulting in sharp drop in yarn export
revenues. The ratings also factor in steady operations of REPL's
electricity sale business, additional incentive income and
depreciation (tax) benefits from its wind mill operations, and
diversification into several business streams. REPL earns
accelerated depreciation benefit from its first turbine (based in
Maharashtra) and incentive benefit on sale of electricity through
GBI (Generation Based Incentive) registration from its second
turbine (based in Jaisalmer). Apart from its primary businesses of
yarn export and electricity sale, the company also generates
additional commission income from sale of software to several
telecom companies and from dealership of Hitachi Air Conditioners
to BSNL.
About Rajendra Exim
Rajendra Exim Private Limited was incorporated in 1996 as a
Private Limited Company. The legal structure of the company was
changed to public limited in 1996, but was later changed back to
private limited in 2002. Mr. Chet Ram Khunteta, Mr. Kamal
Khunteta, Mr. Chandra Shekhar Khunteta, Mr. Mohan Lal Khunteta and
Mr. Rohit Khunteta are the founder directors of REPL. At present,
the day to day affairs of the company are managed by Mr. Chandra
Shekhar Khunteta, Mr. Chet Ram Khunteta and Mr. Kamal Khunteta.
The company is primarily into two lines of businesses: Yarn export
and Electricity sale. As per the company, there was no yarn export
during FY11 owing to constraints imposed by Govt. of India on yarn
export. REPL has two wind power turbines (one in Maharashtra and
one in Jaisalmer) through which it supplies electricity to state
electricity boards. Further, REPL also has Hitachi dealership
business, through which it supplies ACs to BSNL all across the
country. REPL also acts as an agent for supplying software
solutions of Comverse Ltd to several telecom companies.
RESHMIKA MINERALS: CRISIL Upgrades Rating on INR120MM Loan to 'B'
-----------------------------------------------------------------
CRISIL has upgraded its rating on the bank facilities of Reshmika
Minerals & Chemicals Pvt Ltd to 'B/Stable' from 'B-/Stable'.
Facilities Ratings
---------- -------
INR90 Million Cash Credit B/Stable (Upgraded from
'B-/Stable')
INR120 Million Long-Term Loan B/Stable (Upgraded from
'B-/Stable')
INR30 Million Proposed Long-Term B/Stable (Upgraded from
Bank Loan Facility 'B-/Stable')
The upgrade reflects the successful commissioning of the company's
factory; commercial production of which commenced in August 2010.
RMCPL generated revenues of INR164.9 million during 2010-11
(refers to financial year, April 1 to March 31). Its scale of
operations is expected to increase over the medium term as its
capacities stabilize and the company leverages on the promoters'
established relationships with its customers.
The rating continues to reflect RMCPL's small scale of operations,
customer concentrated revenue profile, and weak financial risk
profile marked by a weak liquidity, a small net worth, a high
gearing, and weak debt protection metrics. These rating weaknesses
are partially offset by the experience of RMCPL's promoters in the
chemical industry and established relationships with its
customers.
Outlook: Stable
CRISIL believes that RMCPL will continue to benefit over the
medium term from its promoters' established customer
relationships; moreover, the company's financial risk profile is
expected to improve during this period on the back of the
increasing scale of its operations. The outlook may be revised to
'Positive' in case of improvement in RMCPL's liquidity, most
likely through significant increase in scale of operations and
cash accruals. Conversely, the outlook may be revised to
'Negative' if the company's liquidity weakens further because of
delay in increase in scale of operations.
About Reshmika Minerals
RMCPL is a 50:50 joint venture between the Vanarse group and the
Budhraja group. The company was set up for conversion of manganese
oxide (MnO) into manganese sulphate (MnSO4), which is used in the
production of fungicides. The plant has been set up primarily to
cater to the MnSO4 requirement of Indofil Chemical Company's Dahej
(Gujarat) unit. Commercial production commenced in August 2010.
RMCPL's plant has capacity of 60,000 tonnes per annum, which
amounts to 200 tonnes per day.
RMCPL provisionally reported a profit after tax (PAT) of INR6.29
million on net sales of INR164.9 million for 2010-11.
RMZ GALLERIA: ICRA Assigns '[ICRA]BB+' Rating to INR225cr Loan
--------------------------------------------------------------
ICRA has assigned an [ICRA]BB+ rating to the INR225 crore term
loan programme of RMZ Galleria (India) Private Limited. The
outlook on the rating is stable.
The rating of [ICRA]BB+ for RMZ Galleria, which is in the initial
stages of developing a mixed-use development of approx 13.43 lac
sft at Yelahanka, Bangalore, favorably factors in the strengths
arising from being part of the RMZ Group of companies, the Group's
track record of timely project execution and quality construction
and the tying up of debt funding required for the project. The
rating is however constrained by the construction risks given the
early stage of implementation of the mixed-use development and the
presence of permitting risks given the non-receipt of certain
approvals/sanctions for the project. The project, is besides, also
constrained by the significant market risk given RMZ Group's
limited presence in the residential/retail segment thus far which
is amplified by the fact that no major marketing activity has as
yet commenced and the potential weakening of real estate demand
over the near to medium term; the Group's standing as a quality
developer of commercial space in Bangalore, is however, expected
to act as a mitigant to demand risk to an extent.
About RMZ Galleria
RMZ Galleria proposes to develop a 13.42 lac sft mixed-use
development under a 62% JD agreement (residential, retail and
commercial) at Yelahanka, Bangalore at a total cost of INR500
crore. Plan sanctions are in the process of being obtained;
construction is expected to be completed within a 30-36 month
period and would begin after all approvals/clearances are in
place. The project launch is expected to take place thereafter.
The cost of INR500 crore is expected to be funded by equity
infusion of INR75 crore (equity infused so far is at approx. INR60
crore), construction term loan of INR225 crore and proceeds from
the sale of residential apartments for the balance. Of the entire
area being developed of 13.42 lac sft, RMZ Galleria's
proportionate share is 2.99 lac sft of mall space and 5.54 lac sft
of residential space with the balance being due to the JD partner.
RMZ Galleria is 50% held by Millennia Realtors Private Limited,
(MRPL, rated at [ICRA]BBB), flagship of the RMZ Group, with the
balance being held equally by Mr. Raj Menda and Mr. Manoj Menda
(promoters of the RMZ Group).
SANDHYA AQUA: CRISIL Reaffirms 'B+' Rating on INR18MM Term Loan
---------------------------------------------------------------
CRISIL's ratings on Sandhya Aqua Exports Pvt Ltd's bank facilities
continue to reflect SAEPL's weak financial risk profile, marked by
high gearing, and susceptibility to volatility in raw material
prices, fluctuations in value of the Indian rupee, and to adverse
regulatory changes. These rating weaknesses are partially offset
by SAEPL's promoters' experience in the seafood exports business.
Facilities Ratings
---------- -------
INR18.00 Million Term Loan B+/Stable (Reaffirmed)
INR24.00 Mil. Proposed Term Loan B+/Stable (Assigned)
INR168.00 Million Foreign Bill P4 (Reaffirmed)
Discounting
INR120.00 Million Packing Credit P4 (Reaffirmed)
INR10.00 Million Letter of Credit P4 (Reaffirmed)
& Bank Guarantee
Outlook: Stable
CRISIL believes that SAEPL will maintain its moderate business
risk profile over the medium term, supported by promoter's
extensive experience in the seafood industry and healthy demand
for Indian shrimp in the export market. The outlook may be revised
to 'Positive' if SAEPL's financial risk profile improves, most
likely because of increase in net worth due to equity infusion and
more-than-expected cash accruals. Conversely, the outlook may be
revised to 'Negative' in case SAEPL's capital structure
deteriorates due to larger-than-expected, debt-funded capital
expenditure, or if margins decline sharply due to increase in raw
material costs.
Update
SAEPL's revenues increased significantly to INR600 million in
2010-11 (refers to financial year, April 1 to March 31), from
INR420 million in 2009-10. The increase in revenues is mainly
attributed to increase in demand from the US for Indian shrimp.
However, the operating margin of the company for 2010-11 slipped
to 5.5%, against 6.3% in 2009-10. The decline is on account of
increase in raw shrimp costs, which increased by over 30% to
around INR0.33 million per tonne in 2010-11 from INR0.24 million
in 2009-10.
The company is planning to set up additional cold storage with 400
tonne capacity. The estimated project cost of INR13 million is
expected to be funded in a debt-to-equity ratio of 3:1. The
construction of the cold storage started in May 2011 and the
facility is expected to be operational in the second quarter of
2011-12.
About Sandhya Aqua
Incorporated in 2005, SAEPL processes and exports cultured shrimp.
The company mainly processes black tiger and vannamei varieties of
shrimp. The company exports to the European Union, the US, Russia,
and Australia, among others. SAEPL's processing plant at
Vijayawada (Andhra Pradesh) has capacity to process 15 tonnes of
shrimp per day. The company has two cold storages with a aggregate
capacity of 800 tonnes.
SAEPL reported a profit after tax (PAT) of INR3.7 million on net
sales of INR420.4 million for 2009-10, against a PAT of INR2.3
million on net sales of INR345.4 million for 2008-09. SAEPL's
estimated revenues for 2010-11 are INR600 million.
SHREE AMBAY: ICRA Assigns '[ICRA]B+' Rating to INR2cr LT Loan
-------------------------------------------------------------
ICRA has assigned an '[ICRA]B+' rating to the INR2.00 crore long-
term fund-based bank facilities of Shree Ambay Forgings Pvt Ltd.
ICRA has also assigned an [ICRA]A4 rating to the INR6.00 crore
short term non-fund based bank facilities of SAFPL.
The assigned ratings take into account the highly fragmented and
intensely competitive nature of the MS ingots industry with low
entry barriers, which results in pricing pressures and therefore
low profitability; small scale of SAFPL's current operations and
its weak coverage indicators, indicating a weak financial risk
profile. The ratings are also constrained by the significant
corporate guarantees given by the company on behalf of its various
group companies to financial institutions; high customer
concentration risks with the top five customers accounting for
over 95% of the total sales in 2010-11 though, mitigated to same
extent by timely payments from customers; and the cyclicality
inherent in the steel industry, which is likely to make SAFPL's
profitability and cash flows volatile. The ratings, nevertheless,
favorably factor in the long standing experience of the promoters
in the steel business; the company's moderate capital structure
and favorable outlook for the construction and infrastructure
sectors in India in the long term, which are the key consuming
sectors of SAFPL's products.
Incorporated in 1998, SAFPL is engaged in the manufacturing of MS
ingots from sponge iron, pig iron and steel scrap through the
induction furnace route. SAFPL's manufacturing facility at
Kundaim, Goa has an installed capacity of 15,000 MTPA. Key raw
materials are purchased from manufacturers and traders in Goa,
Maharashtra and Karnataka, including one of its group companies.
MS ingots manufactured by SAFPL are sold primarily to
manufacturers, located in the states of Goa and Maharashtra, of
TMT bars and structural steel.
Recent Results
As per the provisional results for 2010-11, SAFPL reported a
profit after tax (PAT) of INR0.42 crore on an operating income of
INR37.15 crore as compared to a PAT of INR0.12 crore on an
operating income of INR32.61 crore in 2009-10.
SHREE HARI: ICRA Assigns '[ICRA]BB' Rating to INR34.50cr Limits
---------------------------------------------------------------
ICRA has assigned an '[ICRA]BB' rating to the INR34.50 crore fund
based limits of Shree Hari Corporation. The outlook for the long
term rating is stable.
The assigned ratings are constrained by the absence of track
record of the firm, though the promoters have executed real estate
projects in Surat under Vaishnodevi brand name; exposure of firm
to the economic and political scenario of Gujarat state with all
its ongoing and planned projects being located in Surat, Gujarat,
in addition to sectoral concentration risk arising from focus on
residential projects. The rating also takes into account the
funding risk due to the debt and customer advances funded nature
of capex for the projects, vulnerability of profitability to
variations in steel and cement prices and cyclicality of the real
estate sector. The ratings however favorably factor in the
experience of promoters in real estate development, particularly
residential segment, positive outlook for the real estate sector
resulting from increased demand, however same being subjected to
intense competition on account of robust supply. The rating has
also positively considered the healthy booking status for one of
the projects.
Shree Hari Corporation was incorporated in the year 2009 and is
presently engaged in construction of residential apartments. The
firm is promoted by Mr. Sharad P. Kakadiya, Mr. Rajesh Vaghani,
Mr. Manish Katargamwala and his family members. SHC has not
completed any project as of now, however, the promoters have
previously executed several successful projects located in Surat
under the name of firms like Shrey Construction, Rudra Developers,
S.R. Corporation, Sai Corporation, Jai Sachchidanand Corporation
among others.
SOUTH INDIA: ICRA Assigns 'LBB-' Rating to INR25cr Term Loans
-------------------------------------------------------------
ICRA has assigned a long term rating of 'LBB-' to the
INR25.0 crore term loans of South India Shelters Private Limited.
The outlook on the long term rating is Stable.
The rating factors in the promoters' experience in the real estate
industry, the advantageous location of SIS' ongoing projects, the
low cost of the land bank in possession of SIS, and the healthy
profitability achieved by the company in the past. The rating is,
however, constrained by the inherent cyclicality in the real
estate sector and the associated price and off-take risk, the
elevated competitive scenario in the Chennai real estate industry
on the back of large number of new projects being undertaken by
various organized and unorganized players, and the modest scale of
operations of the company. The rating also takes into
consideration the substantial working capital intensity for SIS'
operations arising from a high receivables and inventory position.
South India Shelters Private Limited is a Chennai based real-
estate company undertaking development of residential projects.
The company was incorporated in 2002 by Mr. Mohamed Ali and his
family and has been actively developing projects from 2006
onwards. Prior to the operations in SIS, the promoters were
developing residential projects through a partnership firm M/s.
South India Shelters. Together, these entities have completed
development of two major and fifteen minor residential apartment
projects involving 5 lakh Sq. Ft. of built-up area. SIS is
currently involved in the development of 3 projects -- SIS Safaa
and SIS Marrakesh in Chennai and SIS in Acropole in Trichy, Tamil
Nadu.
For 9M 2010-11, SIS reported PAT (profit after tax) of
INR5.9 crore on an operating income of INR32.4 crore as against
PAT of INR7.8 crore on an operating income of INR42.7 crore in
FY 2009-10.
SRI SRINIVASA: ICRA Revises Rating on INR62.58cr Fund Based Loan
----------------------------------------------------------------
ICRA has revised the rating assigned to INR62.58 crore fund based
and INR1.67 crore bank guarantee facilities of Sri Srinivasa
Spintex (India) Limited to '[ICRA]B+' from LBB.
The revision in rating takes into account the unfavorable demand
conditions with decline in yarn prices and substantial inventory
losses with dip in cotton lint prices post procurement season
coupled with weak financial profile characterized by high gearing
of 3.61 times as on March 31, 2011, and stretched coverage
indicators with OPBDIT/I&F charges at 2.49 times and NCA/Debt at
9% in FY 11.
ICRA notes that the current liquidity situation is tight as
reflected by very high working capital utilization due to high
working capital intensity with significant raw material and
finished goods inventory being piled up for lack of better
realizations. Given the seasonal nature of the industry and
ensuing high raw material requirement, the working capital
intensity is very high at 47% in FY 11.
The ratings, however, favorably factors in the significant rise in
operating income of SSSL by 102% INR29.6 crore in FY 10 to
INR59.76 crore in FY 11 backed by volumetric growth and increase
in realizations due to the increase in the input costs of cotton
lint during FY 11.
SSSL's aggressive growth plans may result in high net funding
requirements to sustain the targeted growth. Moreover, tight
liquidity situation and excessive reliance on debt to fund the
proposed growth plans could have impact on coverage and leverage
indicators. Company Profile Sri Srinivasa Spin-Tex (India) Ltd.
(SSSL) (Erstwhile known as Sri Srinivasa Spintex Private Limited)
was incorporated in July 2006 and is engaged in manufacturing of
grey cotton spun yarn. The company has a spinning mill in West
Godavari district of Andhra Pradesh (A.P.). SSSPL started
commercial production of yarn in August 2008 with 4,000 spindles
which was increased gradually to 18,000 spindles in January 2009
and 42,840 from January 2011. In FY 11, the nature of concern has
been changed from private limited to public limited.
STERLING BIOTECH: ICRA Cuts Rating on INR790cr Loan to '[ICRA]C'
----------------------------------------------------------------
The rating for the INR790.0 crore long-term fund-based facilities
and INR616.0 long-term loans of Sterling Biotech Limited has been
revised to '[ICRA]C' from LBBB+ earlier. The short-term rating
for the INR210.0 crore non-fund based bank facilities of SBL has
also been revised to '[ICRA]A4' from A3+ earlier.
The rating revision takes into account the strained liquidity
position of the company on account of the increased working
capital intensity in the gelatin business, large capital expansion
plans and significant financial support extended to group
companies.
About Sterling Biotech
Sterling Biotech Limited was incorporated on March 23, 1985 in
Mumbai as Pluto Exports & Consultants Limited. The company's name
was changed to Sterling Tea and Industries Limited on June 24,
1991, when it entered the tea plantation business. In 2000, the
company decided to exit the tea plantation business and enter
biotech business. Accordingly, the company's name was changed to
Sterling Biotech Limited to reflect its new identity.
SBL enjoys a dominant position in the Indian market for
pharmaceutical grade gelatin, with significant presence in rest of
Asia and the US markets. Pharmaceutical grade gelatin has a wide
range of applications such as capsules, tablets, health
supplements, surgical aids, suppositories, blood plasma expanders
and in treatment of arthritis, bleeding disorders and cartilage-
related diseases. In addition to the primary product, bone
gelatin, SBL also produces fish and hydrolysed gelatin with
combined capacity of 3,600 MTPA.
SBL has two plants for manufacturing gelatin -- one located in
Baroda, with a capacity of 18,800 MTPA and the other located in
Ooty, with a capacity of 2,200 MTPA. The total capacity of the
company has been enhanced to 22,500 MTPA after de-bottlenecking
and modernisation. The plant at Ooty was added by way of
acquisition of gelatin unit of Rallis India in 2004. In
April 2006, SBL acquired a fermentation-based manufacturing unit
from Torrent Gujarat Biotech Ltd., which was revamped to enable
the production of its new product, CoQ10, in March 2007. The R&D
centre of SBL is located at Masar, Gujarat and carries out in-
house research on CoQ10, generic APIs and development of new
drugs.
Recent results:
As per the audited CY 2010 (financial year runs from January 1 to
December 31) numbers, SBL reported a PAT of INR145.3 crore over an
operating income of INR1627.2 crore.
SWITCHGEARS & STRUCTURALS: ICRA Rates INR6.20cr Loan at '[ICRA]BB'
------------------------------------------------------------------
ICRA has assigned a long term rating of '[ICRA]BB' to the INR6.20
crore Fund Based (Cash Credit) bank facilities of Switchgears &
Structurals (India) Pvt. Ltd. ICRA has also assigned a short term
rating of '[ICRA]A4' to the INR4.80 crore Non-Fund Based (Bank
Guarantee/Letter of Credit) bank facilities of SSPL. The outlook
on the long-term rating is stable.
The ratings factor in the company's modest scale as well as high
working capital intensity of operations, with NWC/OI of 46.88% in
FY 2010 driven by high inventory requirement. The ratings are
further constrained by the high competitive intensity in the
industry; high client concentration risk and the vulnerability of
company's profitability to adverse fluctuations in raw material
prices. The ratings, however, draw comfort from the proven track
record and experience of the promoter group; foray in high voltage
rated product through technological collaboration with an
international company, healthy order-book status providing
visibility to sales in the near term and favorable demand outlook
arising out of government's focus on power sector. Going forward,
the company's ability to scale up its operations while managing
its liquidity position and capital structure, given the high
working capital intensity of operations, remains key rating
sensitive factor.
Switchgears & Structurals (India) Private Limited is engaged in
the design, manufacture and testing of isolators (also known as
disconnectors) and earthing switches. The company was promoted by
Mr. O. Surendra Babu in 1983 as a partnership concern and
converted into a private limited company in 1994. SSPL's product
portfolio includes isolators for the voltage range of 12KV to
765KV. SSPL is ISO 9001:2008 certified by DNV. The company has a
technological collaboration with Hapam B.V., which is a Dutch
company engaged in the manufacture of high voltage disconnectors &
earthing switches for outdoor and indoor substations. SSPL is head
quartered in Hyderabad, Andhra Pradesh (AP), with a branch office
in Orissa.
For the financial year ending March 2010, SSPL reported an
operating income of INR19.17 crore and a net profit of INR0.86
crore as compared to an operating income of INR14.52 crore and
net profit of INR0.63 crore in the previous year.
UNITED COKE: ICRA Reaffirms '[ICRA]BB-' Rating on INR5cr Loans
--------------------------------------------------------------
ICRA has reaffirmed the '[ICRA]BB-' rating assigned to the
INR5.00 Crore fund-based (cash credit) bank limits of United Coke
Private Limited. The outlook on the long-term rating is 'stable'.
ICRA has also reaffirmed the '[ICRA]A4' rating assigned to the
INR20.00 Crore non-fund-based (Letter of Credit) bank limits of
UCPL.2 The fund-based limit of INR5.00 crore is a sub-limit of the
INR20 crore non-fund based limit.
The ratings take into account the significant increase in turnover
and profits of UCPL in the first ten months of FY11, the positive
outlook for the low ash metallurgical (LAM) coke industry,
considering the large investments planned in the steel sector and
the comfortable capital structure of UCPL. The ratings are,
however, constrained by UCPL's exposure to exchange rate
fluctuations arising out of import of coking coal; relatively
small scale of operations accentuated further by the low capacity
utilization and cyclicality inherent in the coke industry in
addition to high volatility in the prices of both coke and coking
coal, which make profitability and cashflows volatile.
UCPL imports coking coal to produce coke at its plant located in
the Anjar district of Gujarat. The plant has an annual capacity of
54,000 metric ton (MT) and its output is sold to small foundries
located in the region. The company is also involved in trading of
coking coal, whose contribution declined to around 2% of total
sales in 2009-10 from 58% in 2007-08. During 2009-10, the capacity
utilization of its coke manufacturing plant increased to around
24% from 15.6% in 2007-08 owing to an overall improvement in the
efficiency of the manufacturing unit and significant increase in
the availability of coal in the international markets at
relatively lower prices. During the first ten months of FY11,
capacity utilization of UCPL's coke manufacturing plant improved
further to 31%.
The operating income of UCPL increased by around 16% to
INR16.61 crore in 2009-10 from INR14.31 crore in 2008-09 on
account an increase in its production levels. Despite a decline in
the coke prices, the net profit margins of the company showed an
improvement to 1.61% in 2009-10 from losses suffered in 2008-09 on
account of a sharp decline in coal prices in 2009-10. In absolute
terms, however, the company's profit remained minimal at INR0.27
Crore in 2009-10. UCPL does not hedge its exposure to foreign
exchange risk associated with its raw material imports, which
could potentially make an impact on its profitability.
During the first ten months in FY11, UCPL's operating income and
profits increased significantly on account of sharp increase in
the coke prices and increase in the production levels. The capital
structure of the company also improved, with a gearing of 0.03
time as on January 31, 2011 from 0.30 time as on March 31, 2011.
Company Profile UCPL was acquired in 2007-08 by the Bhavnagar-
based Aggarwal Group. The company is engaged in the production of
low ash metallurgical (LAM) coke. Its manufacturing plant with an
annual capacity of 54,000 MT is located in the Anjar district of
Gujarat.
VINDHYACHAL HYDRO: ICRA Reaffirms '[ICRA]BB+' Rating on Term Loan
-----------------------------------------------------------------
ICRA has reaffirmed the long-term rating of '[ICRA]BB+'
outstanding on the INR25.00 crore Term Loan facilities of
Vindhyachal Hydro Power Limited. The outlook on the long-term
rating is stable.
The reaffirmation of rating reflects the satisfactory track record
of operations of both the plants of VHPL, firm off-take agreement
at an attractive tariff with INOX Air Products Limited (INOX) and
the limited demand risks with the energy deficit scenario likely
to persist in foreseeable future. The rating also draws comfort
from additional revenue generation from the sale of carbon
emission reduction (CER's) certificates for both the projects
registered as clean development mechanism (CDM) projects with
United Nations Framework Convention on Climate Change (UNFCCC) as
well the recently launched renewable energy credits (REC). The
rating, however, is constrained by the execution risks arising out
of the large expansion plans of the group in relation to the
company's scale of operations and the financial support being
provided by it, in terms of equity and corporate guarantees, for
the various group endeavors. Out of the two projects being
developed by group, the 5.4 MW Sarbari-II small hydro project
(SHP) achieved COD in August 2010, while the 3 MW Shaung SHP is
currently in initial stages of execution. The rating is further
constrained by the variability in cash flows that are typical of
Hydro power plants given that the operating units are not covered
under deemed generation clause in case of factors like shortage of
water. ICRA notes that while VHPL's capitals structure is
currently healthy, at 0.55 times as on March 31, 2011, the high
quantum of Contingent Liability, valued at INR73 crore as on
March 31, 2011, primarily on account of corporate guarantees
extended to group companies limits it's financial flexibility to
some extent.
About Vindhyachal Hydro
Vindhyachal Hydro Power Limited was promoted by Shrikant Somani
group to develop, own and operate two 3 MW small hydro power (SHP)
projects in Thane and Pune Districts of Maharashtra. These
projects are backed by MOUs with Government of Maharashtra
Irrigation Department (GOMID), and Maharashtra Krishna Valley
Development Corporation (MKVDC) respectively. The Group also
operates two SHPs, namely Sarbari - I (4.5 MW) and Sarbari - II
(5.4 MW) and is currently developing a 3 MW project in the state
of Himachal Pradesh. In the financial year ending March 2011, the
company reported an operating income of INR12.08 crore with a net
profit of INR4.49 crore (provisional) as compared to an operating
income of INR11.25 crore and net profit of INR4.25 crore in the
previous year.
Y.S. INVESTMENTS: ICRA Assigns '[ICRA]BB-' Rating to INR4cr Limits
------------------------------------------------------------------
ICRA has reaffirmed the '[ICRA]BB-' rating assigned to the INR4.00
crore fund-based (cash credit) bank limits of Y.S. Investments.
The outlook on the long-term rating is 'stable'. ICRA has also
reaffirmed the [ICRA]A4 rating assigned to the INR41.00 crore non
fund-based (Letter of Credit) bank limits of YSI.
The assigned ratings take into account the established presence of
YSI in the ship breaking industry; improvement in its profit and
coverage indicators in the first ten months of FY11; its track
record of compliance with international environmental norms,
forward linkages with group companies engaged in steel re-rolling;
and a favourable outlook for the ship breaking industry in the
near term on the back of better prospects of ship availability.
The ratings, however, continue to be constrained by the
vulnerability of YSI to the cyclical nature of the steel industry,
the company's small scale of operations; high volatility in
revenues and profits driven by the availability of ships; weak
profitability of operations and exposure to fluctuations in
foreign exchange rates. ICRA has also taken note of the regulatory
risks that are inherent in the ship breaking business.
YSI is primarily engaged in ship breaking, which is conducted at
the plot leased from Gujarat Maritime Board in the Alang Ship
Recycling Yard. From FY06 till FY09, YSI experienced volatility in
operating income and profitability because of unavailability of
ships at acceptable prices owning to the buoyancy in the shipping
industry. However, the ship breaking industry has witnessed a
revival since FY09 on the back of the weakness in the
international shipping industry, which led to better availability
of ships at competitive prices. YSI purchased two ships with large
tonnages in both FY10 and FY11, which has relatively increased the
scale of its operations.
The operating income of YSI improved to INR49.51 crore in FY10
from INR4.49 crore in FY09 on account of an increase in sales of
ship scrap. While the increase in operating profit to INR0.81
crore in 2009-10 from INR0.61 crore in 2008-09 was relatively
small, as a result of an increase in costs, net profit increased
to INR0.9 crore in FY10 from INR0.33 crore in FY09, largely on
account on an increase in non operating income due to gains from
exchange rate variation in FY10. The capital structure witnessed a
deterioration, with the gearing increasing to 0.7 times as on
March 31, 2010 from 0.42 times as on March 31, 2009, on account of
an increase in unsecured loans. Notwithstanding an improvement in
profitability in FY10, an increase in finance expenses resulted in
a decline in interest coverage to 0.87 times in FY10 from 2.57
times in FY09. However, net cash accruals to total debt increased
marginally to 23.67% in FY10 from 20.98% in FY09. ICRA notes that
YSI's gearing and coverage indicators too have displayed wide
volatility in the past, driven by the variability inherent in the
ship breaking business.
During the first ten months of FY11, YSI's turnover grew further
to INR63.79 crore, leading to higher operating profits than the
same in the whole of FY10. Consequently, the coverage indicators
too improved, despite an increase in the gearing levels.
=================
I N D O N E S I A
=================
GAJAH TUNGGAL: Moody's Places 'B3' Ratings on Review
----------------------------------------------------
Moody's Investors Service has placed PT Gajah Tunggal Tbk's B3
corporate family and senior secured ratings on review for possible
downgrade.
This review action follows the payment of a dividend to
shareholders seemingly in contravention of the covenants of its
restructured bonds launched in June 2009, and the resulting
alleged claim of covenant breach by an anonymous bondholder.
Moody's understands that more than 25% of bondholders would need
to agree to a declaration of covenant breach in order to enforce
accelerated repayment of the bond, which matures in 2014.
As a restricted payment, dividends cannot be paid unless a range
of conditions are met. In particular, the payment of a dividend,
before the interest rate has recovered to 10.25%, would represent
a breach of covenant and thus could lead to an accelerated
repayment of the bond.
"The situation is somewhat unusual in that the dividend was paid
last year without the potential covenant breach being disputed by
bondholders, yet the dividend declared and paid this year - about
US$ 5million - is less than last year's payment" says Alan Greene,
a Moody's Vice President and Senior Credit Officer.
"There seems to be some uncertainty as to the role and
requirements of Indonesian Company Law with respect to the
dividend payments. Moreover, if the cash dividend was approved by
a meeting of shareholders, in the knowledge that the action could
potentially accelerate the bond repayment, then this might
indicate lapses in the area of corporate governance" adds Greene
who is also Moody's Lead Analyst for Gajah Tunggal.
Moody's believes that the potential breach of covenant could be
swiftly remedied by the company based on its current liquidity.
Gajah Tunggal held cash and marketable securities of about US$128
million at March 31, 2011, of which cash is US$54 million,
sufficient to cover the coupon due in July and the first
amortization repurchase equivalent to 2.5% of the initial
outstanding principal. However, Gajah Tunggal would not be able to
meet any accelerated full repayment of the bond from its available
sources, which has thus raised the risk of default until the
matter is resolved.
Gajah Tunggal's financial metrics have broadly met expectations
since Moody's last rating action. As a result, the outcome of the
review is highly dependent on the crystallization of this
potential event of default. An acceleration of the bond repayment
would likely lead to a multiple notch downgrade. A resolution of
bondholders' concerns, possibly involving a nominal penalty
payment, would likely result in the confirmation of the current
rating. Moody's would expect the matter to be resolved over the
coming weeks.
However, Moody's is mindful of how the free cash flow might be
impacted over the next one to two years by the capex programme,
higher raw material prices and rising debt service burden, and the
extent to which qualitative aspects of the -- including corporate
governance concerns -- have, in the past, weighed significantly on
the final rating outcome.
The principal methodology used in rating PT Gajah Tunggal Tbk was
the Global Automotive Supplier Industry Methodology published in
January 2009.
Gajah Tunggal is Southeast Asia's largest integrated tire
manufacturer producing over 35 million tires covering motorcycles,
passenger cars and commercial vehicles. Exports accounted for 36%
of sales in 2010 and replacement market sales accounted for almost
87% of total tires sales in FY2010. Giti Tire, a Chinese tire
manufacturer, is a 48.89% shareholder in the company through its
subsidiary, Denham Pte Ltd and Compagnie Financiere Michelin holds
a 10% interest.
=========
J A P A N
=========
TAKEFUJI CORP: Court Rejects Bondholders Bid to Liquidate Firm
--------------------------------------------------------------
Michiyo Nakamoto at The Financial Times reports that the Tokyo
District Court rejected foreign bondholders' proposal to liquidate
Takefuji Corp.
The FT notes that bondholders, including Burlington Loan
Management and Marathon Special Opportunity Master Fund, are
opposed to the administrator's decision to give South Korea's A&P
Financial Co, the right to sponsor Takefuji on the grounds that
more value can be realized by liquidating the group.
A representative of the bondholders' group, which holds 70% of the
US$1 billion in outstanding bonds, said no clear reason was given
for the court's rejection, the FT relates.
"This is disappointing. Japan's legal system is a closed system
and lacks transparency because the court is rejecting the proposal
without really considering it," the FT quotes the representative
as saying.
Creditors apart from A&P have been disadvantaged by the lack of
information available from the administrator, according to the
bondholders and another group of creditors, which has also
submitted an alternative rehabilitation plan, the FT reports.
The bondholders' group is considering its options, but the court's
rejection of their proposal raises the prospect that A&P will win
creditor approval for its rehabilitation plan.
Takefuji filed a bankruptcy petition with the Tokyo District Court
on Sept. 28, 2010, with debts of JPY433.6 billion. Bloomberg has
said the company has become the biggest casualty of Japan's four-
year crackdown on coercive lending practices by consumer finance
companies. The lender is seeking to restructure as borrower
claims of overpaid interest are estimated to exceed JPY1 trillion.
In April this year, Takefuji agreed to be acquired by South
Korea's A&P Financial Co. The company had earlier decided to give
A&P preferential negotiating rights in becoming the sponsor for
its rehabilitation, the Troubled Company Reporter-Asia Pacific
reported on April 13, 2011, citing the Mainichi Daily News.
Takefuji plans to compile and submit its debt-repayment plan by
July 15 to the Tokyo district court, according to Bloomberg News.
About Takefuji
Takefuji Corporation (TYO:8564) -- http://www.takefuji.co.jp/--
is a Japan-based company mainly engaged in the consumer finance
business. The Company operates in two business segments. The
Consumer Finance segment covers the loan and credit card
businesses. The Others segment is involved in the operation of
golf courses, the development, management and leasing of real
estate, the venture capital business, as well as the investment
business, among others. The Company has eight subsidiaries.
=========
K O R E A
=========
JEONBUK BANK: Moody's Reviews Ratings for Possible Downgrade
------------------------------------------------------------
Moody's Investors Service has put on review for possible downgrade
all the ratings of Jeonbuk Bank: A3 long-term global local and
foreign currency deposits, Prime-1 short-term rating, and D+ bank
financial strength rating.
Rating Rationale
"The review of the ratings reflects our concerns over the bank's
aggressive pace of asset growth and likely acquisition of Woori
Capital Co. Ltd., which would pressure its overall credit
quality," says Youngil Choi, a Moody's Vice President/Senior
Credit Officer.
"The review will consider the assumed negative impact on the
bank's standalone credit profile as well as the systemic support
assumption currently incorporated in the bank's long-term deposit
rating," he adds.
1. Aggressive Asset Growth
While the bank still enjoys a relatively good net interest margin
and asset quality, when compared with other domestic banks, its
rapid asset growth has been eroding its capital adequacy and net
interest margin for the past several quarters.
It grew its loan receivables by 27.6% during 2010 and about 5.9%
in 1Q11. As a result, its net interest margin fell to 3.22% in
1Q11 from 3.68% in 4Q09. Its Tier 1 ratio deteriorated to 8.3%
(industry average: 11.2%) as of March 2011, from 9.8% a year ago.
Jeonbuk Bank is considering improving its capital adequacy through
a rights offering, and is revising down its current plan of
doubling its asset size by 2013 due to the government's stringent
regulatory initiatives to curb the rising financial leverage of
Korean households. But Moody's expects the bank's asset growth to
be much faster than other domestic banks, which will pressure its
overall credit quality over the next several years.
2. Acquisition of Woori Capital
On June 16, Jeonbuk Bank announced that it had entered a contract
to acquire a 76.67% stake in Woori Capital. It is now awaiting
regulatory approval and aims to complete the deal within the next
two months.
The bank plans to finance the about KRW109 billion required for
the acquisition by selling investment securities and from cash on
hand.
If the acquisition is completed, based on data as of March 2011,
we estimate Jeonbuk Bank's pro forma consolidated financials as
follows:
Its consolidated NPL ratio (including Woori Capital) would rise by
a few percentage points from the current 1.15%, weighed down by
the declining trend in Woori Capital's assets. The proportion of
delinquent or impaired loans in total loans were 16.9% for Woori
Capital.
Woori Capital's assets stand at KRW1.53 trillion, and would
account for 13.7% of Jeonbuk Bank's consolidated assets at that
time. Therefore, the bank's consolidated Tier 1 capital ratio
would also likely drop slightly.
Moreover, any difficulty Woori Capital may have in accessing the
capital markets would hurt Jeonbuk Bank as the former funds its
operation entirely from wholesale sources, such as debentures,
commercial paper or bank borrowings.
3. Systemic support
In reviewing the bank's long-term deposit ratings, Moody's will
also assess the appropriateness of the systemic support assumption
that is incorporated in the bank's A3 long-term deposit rating,
compared with the other domestic banks and some global peers.
Because of the systemic support assumption, the bank's long-term
deposit rating has been uplifted by three notches from its
standalone Baa3.
4. Prospects
We plan to complete the review within the next three months and
the degree of downgrade on the bank's long-term deposit rating is
likely to be one or two notches.
The last rating action on Jeonbuk Bank was on July 25, 2007, when
its foreign currency short-term deposit rating was raised to
Prime-1 from Prime-2 due to the sovereign upgrade.
The principal methodologies used in this rating were Bank
Financial Strength Ratings: Global Methodology published in
February 2007, and Incorporation of Joint-Default Analysis into
Moody's Bank Ratings: A Refined Methodology published in March
2007.
Jeonbuk Bank is based in Jeonbuk province that generated a gross
regional domestic production of KRW30 trillion, equal to 3.0% of
Korea's GDP in 2010. Established in 1969, it is the dominant bank
in Jeonbuk province. As of March 2011, it had assets of KRW9.7
trillion (about US$8.5 billion).
KOREA EXCHANGE: Lone Star Agrees to Cut Sale Price to KRW4.4-Tril.
------------------------------------------------------------------
Bloomberg News reports that Lone Star Funds agreed to cut the
price of Korea Exchange Bank to KRW4.4 trillion (US$4.2 billion)
and extended the sale deadline as South Korean regulators delay
approving Hana Financial Group Inc.'s takeover.
Bloomberg relates that Hana will pay 6% less than the initial
price of KRW4.7 trillion, for a 51% stake in KEB, and set Nov. 30
as the new completion date, according to a regulatory filing on
July 8. The previous terms allowed Hana or the Dallas-based fund
to scrap the deal if was incomplete by May 24 this year, Bloomberg
notes.
Under the latest agreement, Bloomberg cites, Hana will pay Lone
Star KRW13,390 for each KEB share, down from KRW14,250, according
to the filing.
In November last year, Hana signed an agreement with Lone Star to
buy controlling stake in KEB for KRW4.69 trillion.
Lone Star, a U.S.-based private-equity fund, has had a number of
setbacks in trying to exit from its $1.3 billion investment in
KEB, which it bought in 2003, Dow Jones reported.
About Korea Exchange Bank
Korea Exchange Bank -- http://www.keb.co.kr/-- established in
1967, is one of seven national banks in South Korea with over
300 domestic branches and 28 overseas networks, including
Canada, the United States, Panama and Germany, constituting the
most extensive global banking network of any Korean bank. KEB
Futures -- http://www.kebf.com/-- is a clearing member of KOFEX
and is a subsidiary of Korea Exchange Bank, the official F/X
settlement bank for Korean Futures Exchange.
* * *
Korea Exchange Bank continues to carry Moody's Investors Service
"C-" Bank Financial Strength Rating.
====================
N E W Z E A L A N D
====================
BRIDGECORP LTD: Petricevic Loses Bid to Stay Criminal Proceedings
-----------------------------------------------------------------
BusinessDay.co.nz reports that the High Court at Auckland on
Tuesday rejected former Bridgecorp Ltd director Rod Petricevic's
attempt to stay criminal proceedings.
According to BusinessDay.co.nz, Justice Geoffrey Venning declined
an application by Mr. Petricevic for his trial to be deferred
because he could not afford legal representation.
Mr. Petricevic, BusinessDay.co.nz relates, has claimed a lack of
funds, lack of cooperation by the Crown prosecutors and stress as
reasons for the deferral of his criminal case.
Otago Daily Times says Mr. Petricevic has previously had an
application for legal aid rejected by the Legal Services Agency
which found that he could use money in his family trust to fund
his defence, despite being bankrupt.
Mr. Petricevic's lawyer, Charles Cato, who himself threatened to
walk away from the case if legal aid was not granted, argued that
although Mr. Petricevic was a trustee of his family trust, his
wife and children were beneficiaries, not him.
BusinessDay.co.nz notes that Mr. Petricevic, along with four other
Bridgecorp directors -- Rob Roest, Gary Urwin, Peter Steigrad, and
Bruce Davidson -- face Securities Act charges, with the trial due
to start on August 8. The charges allege that the directors lied
to investors in offer documents registered in December 2006 and
later advertisements for both Bridgecorp secured debentures and
capital notes issued by Bridgecorp Investments.
Justice Venning moved the trial date from August 8 to September 5
to allow the accused more time to prepare his case, Otago Daily
Times reports.
About Bridgecorp Ltd
Based in New Zealand, Bridgecorp Ltd. is a property development
and finance company. Bridgecorp was placed in receivership on
July 2, 2007, after failing to pay principal due to debenture
holders. John Waller and Colin McCloy, partners at
PricewaterhouseCoopers, were appointed as receivers. Bridgecorp
owes around 1,800 debenture holders, which liquidators estimate to
approximate NZD500 million.
Bridgecorp's nine Australian companies were also placed into
voluntary administration, owing about 100 investors about
AUD24 million (NZD27 million).
=================
S I N G A P O R E
=================
TWINS ENGINEERING: Court Enters Wind-Up Order
---------------------------------------------
The High Court of Singapore entered an order on July 1, 2011, to
wind up Twins Engineering & Trading Pte Ltd's operations.
Bh Marine & Offshore Engineering Pte Ltd filed the petition
against the company.
The company's liquidator is:
The Official Receiver
Insolvency & Public Trustee's Office
45 Maxwell Road #06-11
The URA Centre (East Wing)
Singapore 069118
VINCI PTE: Court Enters Wind-Up Order
-------------------------------------
The High Court of Singapore entered an order on July 1, 2011, to
wind up Vinci Pte Ltd's operations.
Rainbow S.r.l. (formerly known as Rainbow S.p.A.) filed the
petition against the company.
The company's liquidator is:
The Official Receiver
The URA Centre (East Wing)
45 Maxwell Road #06-11
Singapore 069118
WEE CHONG: Court Enters Wind-Up Order
-------------------------------------
The High Court of Singapore entered an order on July 1, 2011, to
wind up Wee Chong Builders Pte Ltd's operations.
The Comptroller of Goods and Services Tax filed the petition
against the company.
The company's liquidator is:
Mr Aw Eng Hai
of M/s Foo Kon Tan Thornton LLP
47 Hill Street, #05-01
Singapore Chinese Chamber Of Commerce
& Industry Building
Singapore 179365
YODAI WINDOW: Court Enters Wind-Up Order
----------------------------------------
The High Court of Singapore entered an order on July 1, 2011, to
wind up Yodai Window System & Engineering Pte Ltd's operations.
Subweld Engineering & Fabrication Pte Ltd filed the petition
against the company.
The company's liquidator is:
The Official Receiver
URA Centre (East Wing)
45 Maxwell Road, #05-11/#06-11
Singapore 069118
===============
X X X X X X X X
===============
* Moody's Says Spec-Grade Default Rate Ends at 2.2% in Q2 2011
--------------------------------------------------------------
The trailing 12-month global speculative default rate finished the
second quarter at 2.2%, down from 2.5% in the first quarter of
2011, according to Moody's Investors Service in its monthly
default report. A year ago, the default rate stood at 6.2%.
Moody's default rate forecasting model now predicts that the
global speculative-grade default rate will fall to 1.5% by the end
of this year then edge up to 1.7% by the second quarter of 2012.
"Spreads are widening, particularly in Europe, and the continued
softness in the global economy is certainly worrying" says Albert
Metz, Moody's Director of Credit Policy Research. "But corporate
fundamentals still remain fairly good, spreads, though increasing,
remain near typical levels, and defaults continue to be few and
far between."
There were four debt defaults in the second quarter, bringing the
year to date total to 12. By comparison, there were 17 and 10
defaults in the first and second quarter of last year,
respectively.
Moody's expects default rates to be highest in the Wholesale
sector in the U.S. and the Media: Advertising, Printing &
Publishing sector in Europe.
In the U.S. the speculative-grade default rate ended the second
quarter at 2.6%, down from 2.9% in the previous quarter. At this
time last year, the U.S. default rate was 6.4%.
In Europe, the default rate fell from 1.9% in the first quarter to
1.4% in the second quarter. Last year, the European default rate
ended at 5.6% in the second quarter.
When measured on a dollar-volume basis the global speculative-
grade bond default rate fell slightly to 1.5% at the close of Q2
2011 from 1.6% in Q1 2011. A year ago, the global dollar-weighted
default rate was higher at 3.5%.
In the U.S., the dollar-weighted speculative-grade default rate
closed the quarter at 1.4%. The comparable rate last quarter was
1.5% and 3.5% a year ago.
In Europe, the dollar-weighted speculative-grade bond default rate
remained unchanged from the previous quarter at 1.8%. The
speculative-grade bond default rate stood at 3.4% this time last
year.
Moody's speculative-grade corporate distressed index -- a measure
of the percentage of high-yield issuers that have debt trading at
distressed levels -- rose to 9.5% at the end of the second
quarter, up from the 7.7% level in the previous quarter. A year
ago, the index was markedly higher at 16.0%.
Among U.S. leveraged loan issuers, the trailing 12-month default
rate was unchanged from the previous quarter at 1.7% but
significantly lower than the 6.2% rate recorded this time last
year. Four Moody's-rated companies defaulted on loans in the
second quarter, compared to one in the first quarter.
* S&P's Global Corp. Default Tally Remains at 18 for 2011
---------------------------------------------------------
The 2011 global corporate default tally remains at 18 after no
issuers defaulted last week, said an article published July 8 by
Standard & Poor's Global Fixed Income Research, titled
"Global Corporate Default Update (June 30 - July 6, 2011)
(Premium).
Of the total, 11 issuers were based in the U.S., two each were
based in Canada and New Zealand, and one each was based in the
Czech Republic, France, and Russia. By comparison, 46 global
corporate issuers had defaulted by this time in 2010. Of these
defaulters, 33 were U.S.-based issuers, two were European issuers,
four were from the emerging markets, and seven were in the other
developed region (Australia, Canada, Japan, and New Zealand).
Seven of this year's defaults were due to missed interest or
principal payments and six were due to distressed exchanges --
both among the top reasons for default in 2010. Of the remaining
five, three issuers defaulted after they filed for bankruptcy,
another had its banking license revoked by its country's central
bank, and the fourth was forced into liquidation as a result of
regulatory action.
Of the defaults in 2010, 28 defaults resulted from missed interest
or principal payments, 25 resulted from Chapter 11 and foreign
bankruptcy filings, 23 from distressed exchanges, three from
receiverships, one from regulatory directives, and one from
administration.
* Upcoming Meetings, Conferences and Seminars
---------------------------------------------
July 21-24, 2011
AMERICAN BANKRUPTCY INSTITUTE
Northeast Bankruptcy Conference
Hyatt Regency Newport, Newport, R.I.
Contact: 1-703-739-0800; http://www.abiworld.org/
July 27-30, 2011
AMERICAN BANKRUPTCY INSTITUTE
Southeast Bankruptcy Workshop
The Sanctuary at Kiawah Island, Kiawah Island, S.C.
Contact: 1-703-739-0800; http://www.abiworld.org/
Aug. 4-6, 2011
AMERICAN BANKRUPTCY INSTITUTE
Mid-Atlantic Bankruptcy Workshop
Hotel Hershey, Hershey, Pa.
Contact: 1-703-739-0800; http://www.abiworld.org/
Oct. 14, 2011
AMERICAN BANKRUPTCY INSTITUTE
NCBJ/ABI Educational Program
Tampa Convention Center, Tampa, Fla.
Contact: 1-703-739-0800; http://www.abiworld.org/
Oct. __, 2011
AMERICAN BANKRUPTCY INSTITUTE
International Insolvency Symposium
Dublin, Ireland
Contact: 1-703-739-0800; http://www.abiworld.org/
Oct. 25-27, 2011
TURNAROUND MANAGEMENT ASSOCIATION
Hilton San Diego Bayfront, San Diego, CA
Contact: http://www.turnaround.org/
Dec. 1-3, 2011
AMERICAN BANKRUPTCY INSTITUTE
23rd Annual Winter Leadership Conference
La Quinta Resort & Spa, La Quinta, Calif.
Contact: 1-703-739-0800; http://www.abiworld.org/
April 3-5, 2012
TURNAROUND MANAGEMENT ASSOCIATION
TMA Spring Conference
Grand Hyatt Atlanta, Atlanta, Ga.
Contact: http://www.turnaround.org/
Apr. 19-22, 2012
AMERICAN BANKRUPTCY INSTITUTE
Annual Spring Meeting
Gaylord National Resort & Convention Center,
National Harbor, Md.
Contact: 1-703-739-0800; http://www.abiworld.org/
July 14-17, 2012
AMERICAN BANKRUPTCY INSTITUTE
Southeast Bankruptcy Workshop
The Ritz-Carlton Amelia Island, Amelia Island, Fla.
Contact: 1-703-739-0800; http://www.abiworld.org/
Aug. 2-4, 2012
AMERICAN BANKRUPTCY INSTITUTE
Mid-Atlantic Bankruptcy Workshop
Hyatt Regency Chesapeake Bay, Cambridge, Md.
Contact: 1-703-739-0800; http://www.abiworld.org/
November 1-3, 2012
TURNAROUND MANAGEMENT ASSOCIATION
TMA Annual Convention
Westin Copley Place, Boston, Mass.
Contact: http://www.turnaround.org/
Nov. 29 - Dec. 2, 2012
AMERICAN BANKRUPTCY INSTITUTE
Winter Leadership Conference
JW Marriott Starr Pass Resort & Spa, Tucson, Ariz.
Contact: 1-703-739-0800; http://www.abiworld.org/
April 10-12, 2013
TURNAROUND MANAGEMENT ASSOCIATION
TMA Spring Conference
JW Marriott Chicago, Chicago, Ill.
Contact: http://www.turnaround.org/
October 3-5, 2013
TURNAROUND MANAGEMENT ASSOCIATION
TMA Annual Convention
Marriott Wardman Park, Washington, D.C.
Contact: http://www.turnaround.org/
*********
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, 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 ***