/raid1/www/Hosts/bankrupt/TCRAP_Public/130123.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, January 23, 2013, Vol. 16, No. 16
Headlines
A U S T R A L I A
BAROSSA VALLEY: Placed in Receivership; Owes AUD20 Million
BROADLANDS FINANCE: S&P Lowers Issuer Credit Rating to 'CCC-'
HASTIE GROUP: Faces Investors' Class Action Suit
WICKHAM SECURITIES: SMSFs Set to Lose $27-Mil, Administrator Says
C H I N A
CENTRAL CHINA: Moody's Rates USD Senior Unsecured Notes 'B1'
CENTRAL CHINA: S&P Assigns 'B+' Rating to Proposed USD Notes
CHINA AOYUAN: Fitch Rates USD Senior Unsecured Notes 'B+'
CHINA AOYUAN: Moody's Affirms 'B2' CFR, 'B3' Unsec. Bond Ratings
CHINA SCE: Moody's Affirms 'B1' CFR; Outlook Remains Stable
CHINA TIANRUI: Moody's Withdraws 'B2' CFR; Outlook Negative
FUTURE LAND: Fitch Assigns 'B+' Long-Term Issuer Default Rating
FUTURE LAND: S&P Assigns 'BB-' Corporate Credit Rating
LONGFOR PROPERTIES: S&P Assigns 'BB' Rating to Proposed USD Notes
SCE PROPERTY: S&P Places 'B' Rating on New USD Unsecured Notes
SINO-FOREST CORP: Plan Implementation Date Expected for Jan. 23
WINSWAY COKING: S&P Lowers CCR to 'B', on Negative Creditwatch
* CHINA: GDP Picks Up, Rebalancing Challenge Remains, Fitch Says
H O N G K O N G
INCORPORATED OWNERS of 100: First Meeting Set for Feb. 5
IN-TRUE LIMITED: Court to Hear Wind-Up Petition on March 6
IREWIN INDUSTRIAL: Court Enters Wind-Up Order
KEEN TECH: Creditors to Get 9.76% Recovery on Claims
KOONLEAD ENGINEERING: Sole Shareholder' Meeting Set for Feb. 14
LED INTERNATIONAL: Court to Hear Wind-Up Petition on Feb. 27
M TRAVEL: Court Enters Wind-Up Order
MARCO HOLDINGS: Court to Hear Wind-Up Petition on March 6
MILLENNIUM BANK: Creditors' Proofs of Debt Due Feb. 1
PIONEER (CHINA): Court to Hear Wind-Up Petition on Feb. 27
SPEEDFORM CONSTRUCTION: Arboit and Fok Appointed as Liquidators
STARFISH ENTERPRISES: Court to Hear Wind-Up Petition on Feb. 20
SUN GLORY: Court Enters Wind-Up Order
TALIWORKS-IBI TECHNOLOGIES: Court Enters Wind-Up Order
VIEW BRIGHT: Wardell and Ip Appointed as Liquidators
I N D I A
AGARWAL METALS: Delay in Loan Payment Cues CRISIL Junk Ratings
ASHFORD CONSTRUCTIONS: CARE Puts 'BB+' Rating on INR60cr LT Loan
KINGFISHER AIRLINES: Mumbai Pilots Threaten Winding-Up Petition
K. M. COTEX: CRISIL Assigns 'B+' Rating to INR55MM Cash Credit
KRIPA TELECOM: CARE Rates INR3cr Long-Term Loan at 'CARE B+'
NARSINGH ISPAT: CARE Assigns 'BB+' Rating to INR41.65cr LT Loan
PRADEEP INDUSTRIAL: CARE Rates INR10.5cr LT Loan at 'CARE BB-'
RADHA KRISHNA: Assigns 'BB' Rating to INR25cr Long-Term Loan
RED CHILLIES: CRISIL Assigns 'B' Rating to INR25MM Cash Credit
SPECIAL ENGINEERING: CRISIL Ups Rating on INR65MM Loans to 'B+'
SRI ANJANEYA: CARE Lowers Rating on INR22.2cr LT Loan to 'B+'
VFPL ASIPL: CRISIL Rates INR42.5MM Cash Credit at 'B+'
J A P A N
* JAPAN: Credible Fiscal Strategy Key Issue, Fitch Says
P H I L I P P I N E S
* PHILIPPINES: Public Finances Show Improvement, Fitch Says
X X X X X X X X
* Moody's Says India & Vietnam Exhibit Negative Outlooks
* Upcoming Meetings, Conferences and Seminars
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A U S T R A L I A
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BAROSSA VALLEY: Placed in Receivership; Owes AUD20 Million
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Patrick Stafford at SmartCompany reports that the troubled wine
sector continues to suffer, with the South Australia-based group
Barossa Valley Estate now placed in receivership with reported
debts of AUD20 million.
SmartCompany relates that McGrathNicol has confirmed the grower-
owned Barossa Valley Estate business has been placed in
receivership as of January 15. The business continues to trade as
the receivers, Sam Davies and Rob Kirman, conduct an "urgent
assessment".
According to the report, Mr. Davies said he'll be working with
contract growers and management to settle 2013 grape
requirements, including exports. Mr. Davies said while it's too
early to discuss causes, he noted the business was
undercapitalized, the report relays.
The business will soon be put up for sale and McGrathNicol said
in its statement, the winery contains equipment to crush between
3,000 to 4,000 tonnes every year, with a 41-hectare vineyard
along with a restaurant and function venue, SmartCompany adds.
BROADLANDS FINANCE: S&P Lowers Issuer Credit Rating to 'CCC-'
-------------------------------------------------------------
Standard & Poor's Ratings Services' said that it has lowered its
long-term issuer credit rating on New Zealand finance company
Broadlands Finance Ltd. to 'CCC-' from 'CCC'. The outlook on the
long-term rating remains negative.
"The rating action reflects delays in BFL obtaining registration
of a new debenture prospectus, compared with our expectation that
it would be completed by the end of calendar 2012. In our view,
the delay has further strained BFL's already vulnerable funding
and liquidity position. While the sole shareholder has been
providing support in the form of subordinated advances to meet
short-term liquidity needs, we consider that continued dependence
on this funding source remains a key rating sensitivity.
Additionally, in our view, the prolonged funding constraint
restricts new lending, adversely affecting the finance company's
business position and earning prospects," S&P said.
"We believe that the prolonged delays in the prospectus
registration may erode new investor confidence as well as BFL's
current investor base, as matured investments become more likely
to be reinvested elsewhere, adding pressure to BFL's current
funding and liquidity profile. Further, it could also result in
the sole shareholder losing confidence in the business, and raise
the prospect of a wind-down. We understand that BFL now plans to
register the debenture prospectus in the next few weeks. Our
view is that BFL's funding and liquidity could further weaken if
the prospectus registration is subject to more delays or, if in
our view, funds obtained from investors are insufficient to cover
forecast liquidity needs. The rating could also come under
immediate pressure if the shareholder withdrew his funding
support in the absence of sufficient and stable debenture funding
being established," S&P noted.
The negative outlook reflects BFL's vulnerable funding and
liquidity position, with the company having to meet maturing
liabilities without new debenture funding due to the prospectus
delays. The negative outlook also reflects BFL's vulnerable
earning prospects due to funding-led lending constraints, which
in S&P's view would affect its earnings while the fixed cost
structure remains largely unchanged.
"In our view, the most likely scenario for a rating transition is
on the downside. The rating may be lowered if the registration
of the debenture prospectus is delayed beyond February 2013 or if
the amount raised through debenture issuance was, in our view,
insufficient to cover forecast liquidity needs. The rating may
also be lowered if the shareholder withdrew his current funding
support in the absence of sufficient and stable debenture-funding
being established," S&P added.
S&P's rating is unlikely to be raised in the short-to-medium
term. Over the longer term, and conditional on the demonstrated
stability in debenture funding and positive profitability being
generated, there is scope for an upward revision of rating.
HASTIE GROUP: Faces Investors' Class Action Suit
------------------------------------------------
The Sydney Morning Herald reports that Hastie Group's former
directors, auditor and corporate advisors could face additional
legal action from shareholders on top of the action already
flagged by administrators, after law firm Slater and Gordon
revealed it is investigating the viability of a class action.
According to SMH, commercial and project litigation lawyer Ben
Hardwick said the legal firm has been approached by "dozens of
affected shareholders" since Hastie collapsed in late May 2012.
However, no legal action has been filed and Slater and Gordon has
not yet secured any funding for action, the report says.
SMH relates that Mr. Hardwick said the firm has been contacted by
shareholders and former employees who purchased shares through a
scheme, but has been waiting for administrators PPB Advisory to
release its preliminary report. The report recommends the
company be put into liquidation, according to SMH.
"At present, the shareholders stand to gain nothing from this
liquidation process," the report quotes Mr. Hardwick as saying.
"In the course of its investigation, Slater & Gordon will seek to
work with the administrators and any future liquidators of Hastie
in order to advance the interests of Hastie's shareholders."
In a report released on Jan. 21, 2013, SMH relates, PPB revealed
there could be grounds for former Hastie directors to be
questioned in a public examination, and recommends a liquidator
investigate whether directors breached their duties. It also
raises concerns about the work done for Hastie by its auditor,
Deloitte, and corporate advisors Macquarie Capital and UBS.
About Hastie Group
Hastie Group provides technical and engineering services to the
building, infrastructure and resources sectors. It has operations
in Australia, New Zealand, the United Kingdom, Ireland and the
Middle East and has approximately 7,000 employees worldwide
including approximately 4,000 in Australia.
The Hastie Group of companies appointed David McEvoy, Craig
Crosbie and Ian Carson of PPB Advisory as Voluntary
Administrators of all of the Australian entities of Hastie Group
on May 28, 2012.
Peter Anderson, Joseph Hayes, Jason Preston, and Matthew Caddy of
McGrathNicol were also appointed Receivers and Managers over a
limited number of trading businesses within the Hastie Group by a
syndicate of secured creditors on May 28, 2012. Those businesses
are Spectrum Fire and Safety, Hastie Services, Gordon Brothers
Industries and Austral Refrigeration.
McGrathNicol said the control of those businesses now rests with
the Receivers who intend to continue to trade each one on a
"business as usual" basis while moving quickly to prepare them
for public sale to secure their future. A sale process for the
Austral business was commenced prior to the appointment and the
Receivers intend to quickly complete that process.
WICKHAM SECURITIES: SMSFs Set to Lose $27-Mil, Administrator Says
-----------------------------------------------------------------
Cara Waters at SmartCompany reports that self-managed super funds
are the main victims of the collapse of Queensland company
Wickham Securities.
SmartCompany notes that PPB Advisory was appointed just before
Christmas as administrator of the mortgage finance lender, which
provides funds for borrowers buying or refinancing commercial
property.
The report says Wickham Securities issued notes through Bendigo
and Adelaide Bank's Sandhurst Trustees by way of a public
prospectus that drew in AUD27 million in investment from around
300 investors.
Administrator Grant Sparks told SmartCompany that those 300
unsecured note holders are owed AUD27 million, making up the
substantive part of Wickham's debt.
"The vast majority of those note holders are superannuation funds
and most of them are self-managed funds," the report quotes Mr.
Sparks as saying.
According to the report, Mr. Sparks said the administrators are
still working through their investigations but the problems in
Wickham Securities' loan book stem from the ailing property
market.
"On a preliminary basis, I would say that Wickham lent money to a
sector that has been hit hard, being the property and development
sector, and there hasn't being recognition of changing values of
underlying securities for the loans," Mr. Sparks told
SmartCompany.
Mr. Sparks said part of the administrator's investigations is to
try and understand at what point in time the changes occurred in
Wickham's balance sheet, the report relays.
Sandhurst Trustees is planning a note holders' meeting on
February 5 while a creditors' meeting is scheduled by the
administrators for February 6, SmartCompany discloses.
Wickham Securities is a Brisbane-based financial services
company. Grant Sparks and David Leigh of PPB in Brisbane were
appointed administrators to the company on Dec. 21, 2012.
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C H I N A
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CENTRAL CHINA: Moody's Rates USD Senior Unsecured Notes 'B1'
------------------------------------------------------------
Moody's Investors Service has assigned a B1 rating to the
USD senior unsecured notes proposed by Central China Real Estate
Limited.
At the same time, Moody's has affirmed the company's Ba3
corporate family rating and B1 senior unsecured debt rating.
The ratings outlook is stable.
The proceeds from the USD notes issuance will be used to fund
land acquisitions and development needs, refinance some existing
debt, and for general corporate purposes.
Ratings Rationale
"The issuance of the new USD notes will enhance CCRE's liquidity,
improve its debt maturity profile, and facilitate property
construction and land acquisitions in Henan province," says
Jiming Zou, a Moody's Analyst.
CCRE recorded RMB10.35 billion in contract sales, 15% above its
own target, in 2012. This achievement reflects its ability to
offer products suited to the mass market in Henan and
management's sound sales execution, despite a less-than-favorable
operating environment in 2012.
Given the company's consistent performance in the past and
expected stable market conditions in 2013, CCRE is likely to
continue its growth in contract sales and enhance its business
scale in Henan.
Currently, the company has a significant cash balance, which
amounts to more than half of its total debt outstanding. With the
removal of early redemption rights for its convertible bond in
November 2012 and now this proposed notes issuance, Moody's
expects that its liquidity profile will further strengthen.
The issuance of the USD notes will also provide the company with
additional funds for property construction and land acquisitions.
CCRE had secured a market share of close to 7% in Henan as of
1H2012.
Moreover, the additional funding will allow it to expand its
market coverage and strengthen its position in Henan. In 2012,
CCRE made a series of land acquisitions in Henan for a total
consideration of RMB2.3 billion, which was in line with its
budget.
"The proposed notes issuance will raise CCRE's debt modestly but
it will still be within the Ba3 rating level," says Zou.
Moody's expects EBITDA/interest expense coverage at around 3.0x,
which is still acceptable for the Ba3 corporate family rating.
Although adjusted debt/book capitalization will stand between 55%
and 60%, the company's strong cash balance mitigates against any
rise in debt.
CCRE's Ba3 rating reflects its strong market position and long
operating track record in Henan, where housing demand is growing
and where the market is subject to fewer regulatory restrictions
-- when compared to other areas -- because of its lower property
prices. The rating also takes into consideration the consistently
strong sales performance of the company.
On the other hand, the company's rating is constrained by its
geographic concentration in Henan. It is therefore very reliant
on the region's economy, income levels of homebuyers, and local
government policy.
The stable outlook reflects Moody's expectation that CCRE will
have adequate liquidity to fund its projects and debt repayments,
and will remain focused in Henan and its vicinity. At the same
time, it will maintain its disciplined approach to land
acquisitions.
Upward rating pressure will be limited in the near term. However,
the possibility of an upgrade could emerge over the medium term
if CCRE (1) consistently achieves its planned sales; (2)
demonstrates a track record of good financial discipline with
respect to management of liquidity and debt; (3) demonstrates a
successful property sales track record beyond Henan; and (4)
broadens its offshore banking relationships.
With its credit metrics, Moody's sees EBITDA/interest coverage
consistently above 4-5x and adjusted debt leverage below 40-45%
as indications of a potential for a rating upgrade.
The ratings could come under pressure for a downgrade if CCRE (1)
experiences significant sales declines; (2) suffers a material
decline in profit margins; (3) accelerates expansion that impairs
its liquidity position, and/or increases its debt leverage
materially; and/or (4) undergoes a material reduction in the
ownership level or broad representation of CapitaLand, a
strategic investor.
The potential for a downgrade could be triggered by a decline in
balance-sheet cash, or Moody's expectation that CCRE's credit
metrics would likely deteriorate, that is, EBITDA/interest below
2.5-3x and adjusted leverage above 55%, both on a sustained
basis.
The principal methodology used in this rating was Global
Homebuilding Industry Methodology published in March 2009.
Founded in 1992, Central China Real Estate Limited is a major
property developer in Henan province. As of 31 December 2012, it
had an attributable land bank of 16 million square meters (sqm).
The company listed on the Hong Kong Stock Exchange in June 2008.
The chairman, Mr. Wu Po Sum, has a 47% stake in the company.
CapitaLand (unrated), a strategic investor since 2006, has a 27%
stake.
CENTRAL CHINA: S&P Assigns 'B+' Rating to Proposed USD Notes
------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'B+' long-term
issue rating and 'cnBB' long-term Greater China regional scale
rating to a proposed issue of U.S. dollar-denominated senior
unsecured notes by Central China Real Estate Ltd. (CCRE: BB-
/Stable/--; cnBB+/--).
The issue rating is one notch lower than the corporate credit
rating on CCRE to reflect S&P's opinion that offshore noteholders
would be materially disadvantaged, compared with onshore
creditors, in the event of default. S&P anticipates that the
company's ratio of priority borrowings to total assets will
remain above S&P's notching threshold of 15% for companies with a
speculative-grade rating.
CCRE intends to use the proceeds to fund new and existing
property projects (including land premium), repay existing debt,
and for general corporate purposes. The rating is subject to
S&P's review of the final issuance documentation.
The rating on CCRE reflects the company's limited geographic
diversity and growing competition in Henan province. CCRE's good
sales execution, focused strategy and good market position in
Henan, and sizable low-cost land reserves moderate these
weaknesses. S&P assess the company's business risk profile as
"weak" and its financial risk profile as "aggressive."
The stable rating outlook on CCRE reflects S&P's expectation that
the company will generate satisfactory property sales and have
good financial flexibility to meet its short-term obligations.
S&P anticipates that the company will maintain a debt-to-EBITDA
ratio of 3x-4x in 2013 and have at least Chinese renminbi
1 billion in unrestricted cash annually while pursuing its
high-growth strategy.
CHINA AOYUAN: Fitch Rates USD Senior Unsecured Notes 'B+'
---------------------------------------------------------
Fitch Ratings has assigned China Aoyuan Property Group Limited's
proposed USD senior unsecured notes an expected rating of
'B+(EXP)'. The notes are to be issued as a tap to the USD125m
bonds due 2017 issued in November 2012, with the same terms and
conditions.
Proceeds from the proposed issue will be used to finance its
future payments of land premium and for general corporate
purposes. The final rating of the proposed notes is contingent
upon the receipt of documents conforming to information already
received.
Fitch does not expect Aoyuan's new bonds to have any impact on
its current ratings, as its net debt/adjusted inventory is likely
to remain around 30% post-issue. This is supported by sufficient
liquidity and a robust sales performance. While the company has
been more aggressive in acquiring land parcels in the past three
months, the disposal of its Beijing project and its previous 2017
notes issue provide ample cash inflow to maintain liquidity.
Aoyuan also achieved CNY5.25bn of contracted sales or 105% of its
annual contracted sales target in 2012, reflecting its business
model of efficient churn-out and fast sales turnover.
Aoyuan's ratings remain constrained by its small size and limited
geographical diversification. Notwithstanding the company's
expansion into other provinces in the past several months,
Guangdong was still the major contributor of contracted sales of
about 50% in 2012. In addition, Aoyuan's current project size is
small compared with that of large scale developers. These factors
are likely to limit Aoyuan's pricing power and margins.
The Stable Outlook reflects Fitch's view that the company will
maintain its current sound financial position and high cash
turnover post its tap issue.
What Could Trigger A Rating Action?
Negative: Future developments that may, individually or
collectively, lead to negative rating action include:
- A significant decrease in 2013 contracted sales from 2012
level of CNY5bn, or contracted sales/ total debt falling below
1x on a sustainable basis (H112: 1.07x of LTM contracted
sales/ total debt)
- EBITDA margin in 2013 declining to 15% (H112: 24%)
- Net debt/ adjusted net inventory rising towards 40% on a
sustainable basis (H112: 10.3%)
- Deviation from the current fast churn-out and high cash flow
turnover business model
Positive: Future developments that may, individually or
collectively, lead to positive rating action include:
- A successful execution of Aoyuan's expansion strategy for the
next two to three years, where business scale increases
substantially, such that contracted sales increase to over
CNY15bn or with EBITDA margin increasing to over 25% on a
sustained basis. However, no positive rating action is
expected over the near term given regulatory risks in the home
building industry in China.
CHINA AOYUAN: Moody's Affirms 'B2' CFR, 'B3' Unsec. Bond Ratings
----------------------------------------------------------------
Moody's Investors Service has affirmed China Aoyuan's B2
corporate family rating and B3 senior unsecured bond ratings
after it announced that it will issue additional bonds, and under
the same terms and conditions as those issued in November 2012.
The ratings outlook remains stable.
The proceeds will be used to fund new and existing projects, and
for other general corporate purposes.
Ratings Rationale
"After the additional bond issuance, Aoyuan's credit metrics will
still be positioned within its B2 rating range," says Lina Choi,
a Moody's Vice President and Senior Analyst.
Moody's expects Debt/Total Capitalization of around 50% and
EBITDA/interest of 2x in the next 12 -- 18 months. Such metrics
are acceptable for the B2 rating level.
"The proposed bonds will further enhance the company's liquidity
-- against the backdrop of a stabilizing operating environment
for China's property market over the next 12 months -- as well as
strengthen its financial fundamentals and lengthen its debt
maturity profile," adds Ms. Choi, who is also Moody's lead
analyst for China Aoyuan.
Aoyuan's B2 corporate family rating reflects its track record in
property development in economically strong Guangdong province.
This record has helped the company secure new projects in prime
locations in and outside Guangdong.
Aoyuan's expansion beyond Guangdong could to some extent
alleviate the risk of geographic concentration, but would also
add execution and funding risks in the next 1-2 years. While it
has reported satisfactory sales in Shenyang -- a major city in
northeastern China -- it has yet to establish its reputation
outside Guangdong.
The B2 rating also considers the strength of the company's
management, which has guided Aoyuan through the last two down-
cycles with a degree of access to offshore bank debt funding.
On the other hand, the B2 corporate family rating is constrained
by Aoyuan's small scale and track record of high volatility in
sales and profitability.
The stable outlook reflects Moody's expectation that the company
will maintain adequate liquidity in the absence of aggressive
debt-funded acquisitions.
Downward rating pressure could emerge if (1) Aoyuan's liquidity
and operating cash flow generation are weaker than anticipated,
due in turn to declining sales, or the emergence of more
regulatory controls on China's property sector; (2) there is a
decline in prices and profit margins which negatively affect
interest coverage and financial flexibility; or (3) it engages in
material debt-funded acquisitions.
In such a situation, the company's balance sheet cash (including
restricted and unrestricted cash) could fall below 50% of its
short-term debt, and/or its credit metrics could deteriorate,
resulting in EBITDA margin below 15%; EBITDA/interest below 1.5x;
or adjusted debt/capitalization above 55% on a sustained basis.
On the other hand, upward rating pressure could emerge over the
medium term if Aoyuan establishes a track record in: (1)
achieving planned sales over the next 1-2 years; (2) maintaining
a reasonable cash balance above RMB2.5-3.0 billion; and (3)
demonstrating strong financial discipline, such that its EBITDA
margins exceed 30%, EBITDA/interest exceeds 3x-3.5x, and adjusted
debt capitalization falls below 40-45% on a sustained basis.
The principal methodology used in this rating was Global
Homebuilding Industry Methodology published in March 2009.
China Aoyuan Property Group Limited was founded in 1998 by Mr.
Guo Zi Wen and his brother Mr. Guo Zi Ning.
In 2005 to 2006, the company restructured the shareholdings in
its operating subsidiaries, and the owners transferred their
indirect interests in the Chinese subsidiaries to offshore
subsidiaries. In October 2007, the company was listed on the Hong
Kong Stock Exchange.
As of June 30, 2012, it had 26 projects over 5 provinces,
Chongqing and Beijing. Its total land bank amounted to
8.8 million sqm of gross floor area (GFA) as of June 2012. The
company subsequently disposed of the project in Beijing in
October 2012.
CHINA SCE: Moody's Affirms 'B1' CFR; Outlook Remains Stable
-----------------------------------------------------------
Moody's Investors Service has affirmed China SCE Property
Holdings Ltd's B1 corporate family rating and B2 senior unsecured
debt rating after it announced that it will be issuing new bonds,
and under the same terms and conditions as those issued in
November 2012.
The ratings outlook remains stable.
The proceeds of the bonds will be used for funding land
acquisitions and developing property projects.
Ratings Rationale
"The affirmation reflects the consideration that the additional
bonds will improve China SCE's liquidity profile and debt
maturity profile," says Lina Choi, a Moody's Vice President and
Senior Analyst.
The proposed bonds will enhance China SCE's cash on hand, which
will be enough to cover its short-term debt and committed land
payments.
"The proposed bonds will also provide funding to facilitate China
SCE's sales in 2013, and Moody's notes that the company achieved
an above-expectation performance in pre-sales in 2012," adds
Ms. Choi.
Sales reached RMB6 billion, up from the target of RMB4 billion
set in early 2012, and therefore signifying a 33% outperformance.
Moody's also notes that one third of the company's full-year
contract sales was completed in Q4 2012, suggesting management's
ability to take quickly advantage of improving market sentiment
and the gradual release of latent demand.
Given the Chinese property market is likely to stabilize in 2013,
Moody's expects China SCE's sales momentum will remain solid in
the next 12 months. Such developments will improve cash flow in
2013, a further factor behind the ratings affirmation.
"While the proposed bonds will raise debt leverage, Moody's
expects the improved sales will keep China SCE's credit metrics
within the B1 rating range," says Ms. Choi.
Moody's expects China SCE's interest coverage to keep around 3.0x
and Debt/Total Capitalization to keep between 55% and 60% over
the next 12 -- 18 months. Such metrics still position the company
in the B1 range, although at the weaker end.
China SCE's B1 corporate family rating continues to reflect its
(1) leading market position; (2) quality land bank in Quanzhou;
(3) low-cost land bank strategy; (4) ability to obtain both
onshore and offshore financing; and (5) good sales
implementation.
Its rating also factors in the company's short operating history
and the high implementation and financial risks arising from its
plan to expand beyond Fujian Province to areas where it has yet
to establish its brand and client base.
The B1 rating also takes into account China SCE's small operating
scale, and high geographic concentration in the city of Quanzhou
in Fujian.
The stable outlook reflects Moody's expectation that the company
will maintain discipline in its financial management and land
acquisition strategy. At the same time, it will have adequate
liquidity to support project development and debt repayments in
the next 12 to 18 months.
Upward rating pressure will be limited in the near term. However,
an upgrade is possible in the medium term if China SCE achieves
the following: (1) it demonstrates consistent sales execution and
establishes a longer track record; (2) it maintains its prudent
approach to acquiring land; and (3) EBITDA/interest consistently
exceeds 3.5x and adjusted debt leverage keeps below 50%.
The ratings could come under downward pressure if China SCE (1)
experiences a significant shortfall in sales, and the resultant
actual sales are significantly below Moody's expectations; (2)
suffers from a material decline in profit margins; (3)
experiences an impairment of its liquidity position; and/or (4)
materially increases debt leverage.
Credit metrics indicating such deterioration will include
EBITDA/interest below 2.5x and adjusted debt leverage above 55%-
60% on a consistent basis.
The principal methodology used in this rating was the Global
Homebuilding Industry Methodology published in March 2009.
Founded in 1996, China SCE Property Holdings Limited is a leading
property developer in Fujian Province. The company has also
expanded to cities around the Bohai Rim region, including
Beijing, Anshan (Liaoning Province), Tangshan (Hebei Province),
and Linfen (Shanxi Province), but the majority of its development
projects remain in the cities of Fujian Province. The company has
been listed on the Hong Kong Stock Exchange since February 2010.
The Chairman, Mr Wong Chiu Yeung, holds a 57.5% stake.
CHINA TIANRUI: Moody's Withdraws 'B2' CFR; Outlook Negative
-----------------------------------------------------------
Moody's Investors Service has withdrawn its B2 corporate family
rating with a negative outlook on China Tianrui Group Cement
Company Limited.
Ratings Rationale
Moody's has withdrawn the rating for its own business reasons.
China Tianrui Cement Group Cement Company Ltd., which listed on
the Hong Kong Stock Exchange in December 2011, is the largest
cement producer in China's Henan and Liaoning provinces. The
company had an annual clinker and cement production capacity of
22.25 million tons and 39.23 million tons, respectively, as of 30
June 2012. The company is 39.6% held by its chairman, Li Liufa,
and his son, Li Xuanyu; 18.7% by Tang Ming Chien; 16.7% by KKR,
and 8.4% by JPMorgan.
FUTURE LAND: Fitch Assigns 'B+' Long-Term Issuer Default Rating
---------------------------------------------------------------
Fitch Ratings has assigned China-based Future Land Development
Holdings Limited a Long-Term Issuer Default Rating of 'B+' with a
Stable Outlook. Fitch has also assigned Future Land a senior
unsecured rating of 'B+' and its proposed USD senior unsecured
notes an expected rating of 'B+(EXP)'.
The notes are rated at the same level as Future Land's IDR as
they represent direct, unconditional, unsecured and
unsubordinated obligations of the company. The final rating of
the proposed notes is contingent upon the receipt of documents
conforming to information already received.
Its ratings reflect the company's limited geographic
diversification, cash flow subordination to its key operating
subsidiary, Jiangsu Future Land Co., Ltd., as well as its
resilient business model. Future Land's business profile is
commensurate with a 'BB-' rating but significant structural
subordination to JFL constrains the ratings at the 'B+' level.
Future Land is one of the largest homebuilders in the Yangtze
River Delta (YRD), with CNY16.1bn of contracted sales in 2012,
and 13.7m sqm of landbank as of 31 August 2012. Its business
profile is further supported by its fast sales turnover, as
measured by the LTM contracted sales/total debt ratio of 1.6x at
end-H112. The company's low contracted average selling price
(ASP) - CNY9,184 per sqm in 2012 - despite its focus on the
wealthy YRD is due to its target group being middle class
customers and the mass-market.
These factors enhance its cash flow generation capability and
resilience towards government policies restricting speculative
home purchases. Furthermore, the company generated a moderate
EBITDA margin of 20.5%, which Fitch expects to be maintained over
the next two to three years. Limited diversification beyond YRD,
however, constrains the company's business strengths.
Future Land's cash flow is significantly weakened by the fact
that around 80% of its 2012 contracted sales were generated by a
53.9%-owned publicly listed subsidiary, JFL. JFL also accounted
for around 65.8% of Future Land's landbank as of Aug. 31, 2012,
suggesting that the subsidiary will continue to be meaningful
contributor to total sales over the medium term. The presence of
significant minority interest in JFL structurally subordinates
the cash flows that Future Land derives from JFL. Although Future
Land, as JFL's largest shareholder, is able to determine JFL's
dividends, any large dividend payout will lead to significant
cash outflow to JFL minority shareholders.
Future Land's financial leverage and liquidity improved following
its IPO in November 2012. Fitch estimates that proportionately
consolidated net debt/adjusted inventory will decline to around
22.3% at end-2013, despite an ongoing landbank replenishment
programme. This is because the proceeds from the proposed notes
will enable Future Land to reduce its reliance on more expensive
trust loans at the holding company level for the non-JFL portion
of its business. These factors support the Stable Outlook.
What Could Trigger A Rating Action?
Negative: Future developments that may, individually or
collectively, lead to negative rating action include:
- A significant decrease in contracted sales of the company's
non-JFL business in 2013 from the CNY3bn level achieved in
2012
- A significant decrease in the contracted sales/ total debt
ratio to below 1.0x at the holding company level on a
sustained basis
- Proportionately consolidated net debt/ adjusted inventory
rising above 40% on a sustained basis.
Positive: Future developments that may, individually or
collectively, lead to positive rating action include:
- Substantial increase in the scale of the company's non-JFL
business, with annual contracted sales exceeding CNY10bn
- Unrestricted access to JFL's cash flows
However, Fitch views these as remote prospects over the next 12
months.
FUTURE LAND: S&P Assigns 'BB-' Corporate Credit Rating
------------------------------------------------------
Standard & Poor's Ratings Services said that it had assigned its
'BB-' long-term corporate credit rating to China-based property
developer Future Land Development Holdings Ltd. The outlook is
stable. S&P also assigned its 'cnBB+' long-term Greater China
regional scale rating to the company. At the same time, S&P
assigned its 'B+' issue rating and 'cnBB' Greater China regional
scale rating to Future Land's proposed issue of benchmark-size
U.S. dollar-denominated senior unsecured notes. The rating on
the proposed notes is subject to S&P's review of the final
issuance documentation.
"The rating on Future Land reflects the company's volatile and
low profit margins, some geographic concentration, and its short
record in developing mixed-use property projects," said Standard
& Poor's credit analyst Dennis Lee. "Future Land's good sales
execution capability, established market position in its home
base Changzhou, and disciplined financial management temper the
above weaknesses."
"We assess Future Land's business risk profile as "weak" and its
financial risk profile as aggressive," S&P noted.
The issue rating is one notch lower than the long-term corporate
credit rating on Future Land to reflect S&P's opinion that
offshore noteholders would be materially disadvantaged, compared
with onshore creditors, in the event of default. S&P anticipates
that the company's ratio of priority debt to total assets will
remain above its threshold of 15% for speculative-grade
companies.
Future Land intends to use the net proceeds to repay certain
existing loans, fund land acquisitions, and for general corporate
purposes.
The structural subordination risk for the notes is also reflected
in the separate listing of Future Land's major subsidiary,
58.86%-owned Jiangsu Future Land Co. Ltd., on China's 'B'-share
market in Shanghai, where stocks are denominated in U.S. dollar.
Future Land's non 'B'-share segment, which focuses on mixed-use
property projects, has historically generated less than 30% of
the company's consolidated property sales in China, and accounted
for an even lower proportion of its profits and revenue.
"We are unclear if Future Land's aggressive expansion into mixed-
use property projects will generate the returns that the company
expects. In our view, Future Land has a short record in property
leasing and management of shopping malls and offices. Sales and
rental income could slip if the company delays completing
projects or securing tenants. The company's expansion into other
cities is an additional execution challenge," S&P added.
Future Land has high geographic concentration in its main market
in the Yangtze River Delta, especially in Changzhou. At the end
of August 2012, 52% of the company's land reserves were in
Changzhou. Future Land's property sales are vulnerable to
changing market conditions and policy risks in that city.
Future Land's financial risk profile will remain a major rating
constraint over the next two years at least, in S&P's view. The
company's profit margins are volatile and weaker than other 'BB-'
rated peers'. In addition, the company's leverage is higher than
that of similarly rated peers, reflecting its high reliance on
debt-funded expansion in the past several years. Further, the
company's funding costs are higher than some of the 'BB-' peers'.
Future Land has smaller land reserves compared with that of some
similarly rated peers.
Future Land benefits from its established and solid foothold in
Changzhou and some market presence in Shanghai. In S&P's view,
the company has maintained its market share despite intensifying
competition from national-scale property developers due to its
product diversity, competitive pricing targeted at the mid-market
segment, and good execution. S&P expects Future Land to maintain
its competitive position and believe that the company will
benefit from a recovery in consumer sentiment as the property
market outlook stabilizes.
"The stable outlook reflects our expectation that Future Land
will improve its property sales and margins and maintain
disciplined financial management while pursuing growth," said Mr.
Lee.
S&P may lower the rating if: (1) Future Land's property sales are
below Chinese renminbi (RMB) 20 billion in 2013; (2) the
company's margins do not recover; and (3) its debt-funded
expansion is more aggressive than S&P expected. A downgrade
trigger could be a debt-to-EBITDA ratio over 5x. S&P could also
downgrade Future and if the holding company's cash balance is
below RMB2 billion on a sustained basis.
Potential rating upside for Future Land is limited in the next 12
months. However, S&P could raise the rating if the company's
profitability improves and stabilizes, its execution of the non
'B'-share segment and geographic diversity improve, and it
maintains prudent financial management.
LONGFOR PROPERTIES: S&P Assigns 'BB' Rating to Proposed USD Notes
-----------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'BB' rating to a
proposed issue of U.S.-dollar-denominated senior unsecured notes
by Longfor Properties Co. Ltd. (BB+/Stable/--; cnBBB+/--). S&P
also assigned its 'cnBBB' Greater China regional scale rating to
the proposed notes. The ratings are subject to S&P's review of
the final issuance documentation. S&P expects the company to use
a substantial portion of the net proceeds to refinance its
existing debt.
The issue rating is one notch lower than the corporate credit
rating to reflect S&P's opinion that offshore noteholders would
be materially disadvantaged, compared with onshore creditors, in
the event of default. In S&P's view, Longfor's ratio of priority
borrowings to total assets is likely to remain above S&P's
notching threshold of 15% for speculative-grade debt.
The corporate credit rating on Longfor reflects the company's
rapid growth strategy and short track record as a large-scale
developer. Longfor is also exposed to the high-end real estate
market in tier-one cities in China. This segment is affected by
government policies to cool investment demand and housing prices.
Nevertheless, in S&P's view, the company's good competitive
position and execution capability are likely to support its
financial performance. In addition, China's real estate market
has stabilized. Although Longfor's financial performance for the
first six months of 2012 met S&P's expectation, its debt-to-
capital ratio was moderately higher than it had anticipated. S&P
expects the management to control and manage total borrowings
such that the ratio is within its rating trigger of 50% for 2012
and beyond.
The stable outlook on Longfor reflects S&P's expectation that the
company can demonstrate conservative cash and debt management to
generate positive cash flow while pursuing high growth. In S&P's
view, Longfor's good competitive position, operational record,
and financial discipline will help the company maintain its
financial strength.
SCE PROPERTY: S&P Places 'B' Rating on New USD Unsecured Notes
--------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'B' long-term
issue rating and 'cnB+' long-term Greater China regional scale
rating to a proposed issue of U.S. dollar-denominated senior
unsecured notes by China SCE Property Holdings Ltd. (CSCE:
B+/Negative/--; cnBB-/--). CSCE intends to use the net proceeds
to finance new and existing projects (including construction
costs and land costs) and for general corporate purposes. The
rating is subject to S&P's review of the final issuance
documentation.
The issue rating is one notch lower than the long-term corporate
credit rating on CSCE to reflect S&P's opinion that offshore
noteholders would be materially disadvantaged, compared with
onshore creditors, in the event of default. S&P anticipates that
the company's ratio of priority debt to total assets will
continue to be above S&P's threshold of 15% for speculative-grade
companies.
The rating on CSCE reflects the company's small business scale
and higher concentration risk than that of peers with a similar
rating, its execution risk outside Fujian province, and its weak
and volatile financial history. S&P's views that CSCE has an
established market position in its home base Quanzhou and a low-
cost land bank tempers these weaknesses. S&P assess the
company's business risk profile as "weak" and its financial risk
profile as "aggressive."
"The negative rating outlook reflects our view that CSCE's debt-
funded expansion has become more aggressive and that its
financial risk profile could weaken in the next six to 12 months.
The company's total borrowing will increase significantly to fund
future business expansion, but it may take time to deliver and
recognize any improvement in property sales. We also expect CSCE
to maintain adequate liquidity during its business expansion. We
anticipate that the company will hold at least Chinese renminbi 1
billion in unrestricted cash and maintain its debt-to-EBITDA
ratio at less than 5x over the next 12 months," S&P said.
SINO-FOREST CORP: Plan Implementation Date Expected for Jan. 23
---------------------------------------------------------------
Sino-Forest Corporation on Jan. 21 disclosed that the Plan
Implementation Date, the date on which the Company's CCAA Plan of
Compromise and Reorganization dated December 3, 2012 is to become
effective, has been extended with the consent of the Initial
Consenting Noteholders and the Monitor and is now expected to
occur on Jan. 23, 2013. All capitalized terms not otherwise
defined herein are as defined in the Plan.
In addition, as a result of the addition of another defendant to
the list of Named Third Party Defendants under the Plan, the
amount of the reserve for Unresolved Claims against Sino-Forest
to be created under the Plan has been further reduced from $28.5
million to an aggregate amount of $1.7 million. As a result of
the further reduction in the Unresolved Claims Reserve, more than
98.5% of the Newco Notes and Newco Shares will be distributed to
Affected Creditors of Sino-Forest with Proven Claims in
connection with the implementation of the Plan.
About Sino-Forest Corp.
Sino-Forest Corporation -- http://www.sinoforest.com/-- is a
commercial forest plantation operator in China. Its principal
businesses include the ownership and management of tree
plantations, the sale of standing timber and wood logs, and the
complementary manufacturing of downstream engineered-wood
products. Sino-Forest also holds a majority interest in
Greenheart Group Limited, a Hong-Kong listed investment holding
company with assets in Suriname (South America) and New Zealand
and involved in sustainable harvesting, processing and sales of
its logs and lumber to China and other markets around the world.
Sino-Forest's common shares have been listed on the Toronto Stock
Exchange under the symbol TRE since 1995.
Sino-Forest Corporation on March 30, 2012, obtained an initial
order from the Ontario Superior Court of Justice for creditor
protection pursuant to the provisions of the Companies' Creditors
Arrangement Act.
Under the terms of the Order, FTI Consulting Canada Inc. will
serve as the Court-appointed Monitor under the CCAA process and
will assist the Company in implementing its restructuring plan.
Gowling Lafleur Henderson LLP is acting as legal counsel to the
Monitor.
During the CCAA process, Sino-Forest expects its normal day-to-
day operations to continue without interruption. The Company has
not planned any layoffs and all trade payables are expected to
remain unaffected by the CCAA proceedings.
WINSWAY COKING: S&P Lowers CCR to 'B', on Negative Creditwatch
--------------------------------------------------------------
Standard & Poor's Ratings Services said that it had lowered its
long-term corporate credit rating on Winsway Coking Coal Holdings
Ltd. to 'B' from 'B+'. At the same time, S&P lowered the rating
on the company's senior unsecured notes to 'B' from 'B+'. S&P
also lowered its long-term Greater China regional scale rating on
Winsway and on the notes to 'cnB+' from 'cnBB-'. In addition,
S&P placed all the ratings on CreditWatch with negative
implications. Winsway is a China-based coking coal supply and
logistics provider.
"We downgraded Winsway because we are unclear if the company can
turn around its financial performance in 2013 following an
expected loss in 2012," said Standard & Poor's credit analyst
Huma Shi. "A recent profit warning from Winsway suggests that
its financial results for 2012 could be significantly below our
previous base-case expectations."
Based on S&P's preliminary analysis, Winsway's cash flow
protection will likely remain weak in 2013, due to depressed coal
prices, high inventory, and the uncertain ramp-up of a new coal
mine in Canada. In S&P's opinion, the company's business model
of back-to-back contracts with customers has not protected
Winsway from its exposure to coal-price volatilities.
S&P is also unclear when transport links and production at
Winsway's Canada operations will improve. Canada's Westshore
Terminals port closed late last year, and this affected the
already-weak profitability of Grand Cache Corp. (GCC), a coal
mine that Winsway recently acquired.
"In the absence of asset sales, Winsway's management of working
capital and liquidity will be critical for the company to weather
the current difficulties," said Ms. Shi.
"We aim to resolve the CreditWatch placement in the coming weeks.
Our assessment of the rating depends on Winsway's liquidity
position and the company's likely operating performance and cash
flows in 2013. We could lower the rating by one notch if we
believe Winsway's liquidity in the next 12 months will
deteriorate and the company will not have sufficient cash sources
to meet its obligations," S&P said.
S&P could affirm the rating with a negative outlook if it
believes Winsway's operating performance can improve, which
depends on higher coal prices and an increase in GCC's production
and shipments.
In resolving the CreditWatch, S&P will focus on: (1) how Winsway
will preserve its cash and lower its cost position amid the
current conditions; and (2) how reduced profit would affect the
company's access to bank financing.
* CHINA: GDP Picks Up, Rebalancing Challenge Remains, Fitch Says
----------------------------------------------------------------
Fourth-quarter GDP data recently released suggest China has
avoided a sharp economic slowdown -- or "hard landing" -- for the
moment, Fitch Ratings says. Nevertheless, risks to economic
growth remain, chief among them in the near term being potential
problems in the financial systems. And the economy still faces
the challenge of rebalancing towards consumption away from
investment.
Fitch says: "The figures show that the Chinese economy grew by
7.9% in Q412 from a year earlier, taking annual growth in 2012 to
7.8%, in line with our forecast, and consistent with our
expectation of real GDP growth rates of 7%-8% over 2012-2014. The
Q4 reading is a pick-up from Q3's 7.4% year-on-year growth. It
appears to confirm a recovery already suggested by other
indicators, such as the rise in purchasing manager indices. We
predict modest monetary and public-investment stimulus to support
real GDP growth of about 8% in 2013.
"A hard landing seems to have been avoided, but monetary easing
in 2012 spurred the amount of credit in China's economy to new
highs and intensified Fitch's concerns about a debt problem in
China. Official data show "total social financing" grew 23% over
the year, after an 8.5% contraction in 2011. Fitch estimates
total credit in China's economy, including items off bank balance
sheets, at about 190% of GDP by end-2012, up from 124% at end-
2008.
"We expect this debt problem to require sovereign resources to be
resolved. This will weigh on China's local-currency sovereign
credit profile and drives the Negative Outlook on the 'AA-'
rating.
"Even if the debt problem can be resolved without denting China's
growth, the macroeconomic outlook for the medium term is more
challenging. China faces the increasingly urgent task of
rebalancing its economy away from investment and towards
consumption. The data show limited progress so far. Consumption
contributed 4pp to annual growth in 2012, similar to the
investment contribution of 3.9pp. (Net trade subtracted 0.2pp
from the growth rate.) Retail sales grew a robust 14.5% in Q412
year on year by Fitch's calculation, but were outstripped by
fixed asset investment growth of 20.3% for the same period.
"The investment-led growth model is running into tightening
constraints. The first constraint arises from the ability of the
financial system to fund more capital spending in light of the
existing scale of leverage and emergent pressure on bank
liquidity. The second constraint is that still-higher investment,
without a commensurate rise in the already-stratospheric savings
rate, would see China running the risk of incurring a structural
current account deficit.
"In the longer term, the ability of China's economy to rebalance
will also be significant for the ratings via its impact on
economic growth and stability."
================
H O N G K O N G
================
INCORPORATED OWNERS of 100: First Meeting Set for Feb. 5
---------------------------------------------------------
Creditors and contributories of The Incorporated Owners of 100,
Caine Rd, Hong Kong will hold their first meetings on Feb. 5,
2013, at 2:30 p.m., and 3:00 p.m., respectively at at the
Official Receiver's Office, 10th Floor, Queensway Government
Offices, 66 Queensway, in Hong Kong.
At the meeting, Teresa S W Wong, the company's liquidator, will
give a report on the company's wind-up proceedings and property
disposal.
IN-TRUE LIMITED: Court to Hear Wind-Up Petition on March 6
----------------------------------------------------------
A petition to wind up the operations of In-True Limited will be
heard before the High Court of Hong Kong on March 6, 2013, at
9:30 a.m.
Standard Chartered Bank (Hong Kong) Limited filed the petition
against the company on Dec. 31, 2012.
The Petitioner's solicitors are:
Tsang, Chan & Wong
16th Floor, Wing On House
No. 71 Des Voeux Road
Central, Hong Kong
IREWIN INDUSTRIAL: Court Enters Wind-Up Order
---------------------------------------------
The High Court of Hong Kong entered an order on Jan. 9, 2013, to
wind up the operations of Irewin Industrial Limited.
The official receiver is Teresa S W Wong.
KEEN TECH: Creditors to Get 9.76% Recovery on Claims
----------------------------------------------------
Keen Tech Engineering Limited, which is in liquidation, will
declared dividend to its creditors on Feb. 8, 2013.
The company will pay 9.76% for ordinary claims.
The company's liquidator is:
Kenny King Ching Tam
Room 908, 9/F
Nan Fung Tower
173 Des Voeux Road
Central, Hong Kong
KOONLEAD ENGINEERING: Sole Shareholder' Meeting Set for Feb. 14
---------------------------------------------------------------
Sole shareholder of Koonlead Engineering Limited will hold their
final general meeting on Feb. 14, 2013, at 10:00 a.m., at Unit 7,
1st Floor, Block B, Tonic Industrial Centre, 19 Lam Hing Street,
Kowloon, in Hong Kong.
At the meeting, Yang Chun Thomas, the company's liquidator, will
give a report on the company's wind-up proceedings and property
disposal.
LED INTERNATIONAL: Court to Hear Wind-Up Petition on Feb. 27
------------------------------------------------------------
A petition to wind up the operations of Led International Green
Energy Corporation Limited will be heard before the High Court of
Hong Kong on Feb. 27, 2013, at 9:30 a.m.
WPI International (Hong Kong) Limited filed the petition against
the company on Dec. 24, 2012.
The Petitioner's solicitors are:
Ng, Au Yeung & Partners
Unit E, 4th Floor
China Overseas Building
139 Hennessy Road
Wanchai, Hong Kong
M TRAVEL: Court Enters Wind-Up Order
------------------------------------
The High Court of Hong Kong entered an order on Jan. 9, 2013, to
wind up the operations of M Travel Limited.
The official receiver is Teresa S W Wong.
MARCO HOLDINGS: Court to Hear Wind-Up Petition on March 6
---------------------------------------------------------
A petition to wind up the operations of Marco Holdings Limited
will be heard before the High Court of Hong Kong on March 6,
2013, at 9:30 a.m.
Istril Limited filed the petition against the company on Dec. 31,
2012.
The Petitioner's solicitors are:
Ford, Kwan & Company
Suite 3304, 33rd Floor
Tower Two, Nina Tower
No. 8 Yeung Uk Road
Tsuen Wan, New Territories
Hong Kong
MILLENNIUM BANK: Creditors' Proofs of Debt Due Feb. 1
-----------------------------------------------------
Creditors of Millennium Bank Inc, which is in liquidation, are
required to file their proofs of debt by Feb. 1, 2013, to be
included in the company's dividend distribution.
The company's liquidators are:
Edward Simon Middleton
Wing Sze Tiffany Wong
Charles Thresh
8th Floor, Prince's Building
10 Chater Road
Central, Hong Kong
PIONEER (CHINA): Court to Hear Wind-Up Petition on Feb. 27
----------------------------------------------------------
A petition to wind up the operations of Pioneer (China) Limited
will be heard before the High Court of Hong Kong on Feb. 27,
2013, at 9:30 a.m.
Sun Hung Kai Investment Services Limited filed the petition
against the company on Dec. 11, 2012.
The Petitioner's solicitors are:
Deacons
5th Floor, Alexandra House
18 Chater Road
Central, Hong Kong
SPEEDFORM CONSTRUCTION: Arboit and Fok Appointed as Liquidators
---------------------------------------------------------------
Messrs. Bruno Arboit and Fok Hei Yu on Dec. 11, 2012, were
appointed as liquidators of Speedform Construction Co., Limited.
The liquidators may be reached at:
Messrs. Bruno Arboit
Fok Hei Yu
Level 22, The Center
99 Queen's Road
Central, Hong Kong
STARFISH ENTERPRISES: Court to Hear Wind-Up Petition on Feb. 20
---------------------------------------------------------------
A petition to wind up the operations of Starfish Enterprises
Limited will be heard before the High Court of Hong Kong on
Feb. 20, 2013, at 9:30 a.m.
Terry McKenna filed the petition against the company on Dec. 11,
2012.
The Petitioner's solicitors are:
ONC Lawyers
15 Floor, The Bank of East Asia Building
10 Des Voeux Road
Central, Hong Kong
SUN GLORY: Court Enters Wind-Up Order
-------------------------------------
The High Court of Hong Kong entered an order on Jan. 9, 2013, to
wind up the operations of Sun Glory (Hong Kong) Limited.
The official receiver is Teresa S W Wong.
TALIWORKS-IBI TECHNOLOGIES: Court Enters Wind-Up Order
------------------------------------------------------
The High Court of Hong Kong entered an order on Jan. 9, 2013, to
wind up the operations of Taliworks-Ibi Technologies
International Limited.
The official receiver is Teresa S W Wong.
VIEW BRIGHT: Wardell and Ip Appointed as Liquidators
----------------------------------------------------
Messrs. James Wardell and Jackson Ip on Oct. 15, 2012, were
appointed as liquidators of View Bright Limited.
The liquidators may be reached at:
Messrs. James Wardell
Jackson Ip
Suite 1704, 17/F
625 King's Road
North Point, Hong Kong
=========
I N D I A
=========
AGARWAL METALS: Delay in Loan Payment Cues CRISIL Junk Ratings
--------------------------------------------------------------
CRISIL has downgraded its rating on the bank facilities of
Agarwal Metals & Alloys to 'CRISIL D' from 'CRISIL B/Stable'.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 240.0 CRISIL D (Downgraded from
'CRISIL B/Stable')
Proposed Long-Term 10.0 CRISIL D (Downgraded from
Bank Loan Facility 'CRISIL B/Stable')
The rating downgrade reflects instances of delay by AMA in
servicing its debt; the delays have been caused by the firm's
weak liquidity, resulting from its large working capital
requirements.
AMA has a weak financial risk profile, marked by a small net
worth, high gearing, and average debt protection metrics. The
firm has limited pricing flexibility and its profitability is
susceptible to volatility in raw material prices. The firm,
however, benefits from AMA's established presence in the
aluminium manufacturing industry.
Agarwal Metals, set up in 1996 as a partnership firm, was
promoted by Mr. Sital Kumar Agarwal and his brother, Mr. Vinod
Kumar Agarwal. The firm manufactures non-ferrous metal alloys,
primarily aluminium ingots from scrap aluminium.
ASHFORD CONSTRUCTIONS: CARE Puts 'BB+' Rating on INR60cr LT Loan
----------------------------------------------------------------
CARE assigns 'CARE BB+' rating to the bank facilities of Ashford
Constructions Private Limited.
Amount
Facilities (INR crore) Ratings
----------- ----------- -------
Long-term Bank Facilities 60 CARE BB+ Assigned
(Proposed)
Rating Rationale
The rating assigned is constrained by the project execution risk
as well as marketing risk associated with saleability of the
super-premium project, competition from the upcoming similar
projects in the nearby vicinity, financial closure yet to be
completed and cyclical nature of the industry.
The rating, however, derives strength from the promoter's vast
experience in the real estate business and established track
record of executing real estate projects, prime location of the
project, approvals in place including commencement certificate
till plinth level for the project and availability of the entire
land fully funded by the promoters. The rating also takes into
account the placement of the construction contract to the reputed
player.
Going forward, the ability of the company to complete the entire
project without any time and cost overrun; and market and sell
the property in timely manner will be the key rating
sensitivities.
Ashford Constructions Private Limited is promoted by the
promoters of the Ashford group and the Alok group to execute a
residential complex called "Ashford Palazzo" at Breach Candy,
Bhulabhai Desai Road, Mumbai. Furthermore, the promoters of the
Ashford group and Alok Infrastructure Limited (AIL), a wholly-
owned subsidiary of Alok Industries Ltd., which is the
flagship company of the Alok group have infused interest-free
unsecured loan to the tune of INR142.27 crore in ACPL.
The Ashford group is engaged in the construction of residential,
commercial and hospitality complexes across suburban Mumbai i.e.
Andheri, Versova, Ghatkopar, etc. Also, AIL is involved in
buying and developing commercial and residential property in and
around Mumbai.
ACPL is constructing a residential complex called 'Ashford
Palazzo' on 0.42-acre land purchased from Bennett & Coleman India
Private Limited. The project comprises development of a 19-floor
residential tower, of which first six floors comprise the car
parking area. The total project cost to develop the saleable area
of about 0.96 lakh square feet (lsf) is around INR248.48 crore
and the project is envisaged to be completed by December 2014.
The project cost is proposed to be funded by the promoters'
contribution of INR142.28 crore, term loan of INR60 crore and
customer advances of INR46.20 crore.
KINGFISHER AIRLINES: Mumbai Pilots Threaten Winding-Up Petition
----------------------------------------------------------------
Press Trust of India reports that Mumbai-based pilots of grounded
Kingfisher Airlines have served the cash-strapped carrier an
ultimatum to clear their dues by January 31 or face another
winding-up petition.
According to the report, the pilots gave the ultimatum at a
meeting with top management representatives, including chief
executive Sanjay Agarwal. The development comes even as the
management appealed to its Delhi-based engineers not to resort to
any legal action, the report relays.
"The management has appealed to the engineers to not file a
winding-up petition as it will have an adverse impact on the
revival plan, which is awaiting regulatory approval," airline
sources told PTI.
PTI notes that the appeal was made at a two-hour meeting between
the management and pilots at the Kingfisher House in Mumbai on
Monday evening.
On Jan. 20, PTI recalls, the engineers in New Delhi had decided
to move a winding-up petition in the Delhi High Court by the end
of the week.
"Pilots categorically told the management that it must clear
their salary dues by the month-end failing which they will take a
legal recourse in the form of a similar action that is decided by
the engineers," the report quotes sources as saying.
The management, however, told them that it expects to have "some
funds in the account" by the week end, the sources said.
About Kingfisher Airlines
Headquartered in Mumbai, India, Kingfisher Airlines --
http://www.flykingfisher.com/-- formerly known as Deccan
Aviation Ltd., serves about 35 domestic destinations with a fleet
of more than 40 aircraft, including Airbus jets and ATR 72
turboprops. It maintains bases in major cities such as Delhi and
Mumbai.
* * *
As reported in the Troubled Company Reporter-Asia Pacific on
Sept. 5, 2012, The Times of India said Kingfisher Airlines has
been given a reality check by its auditors in the company's
annual report 2011-12. The company had current liabilities,
including borrowings and trade payables of INR8,436 crore,
against current assets of INR1,618.8 crore at the end of
March 2012. According to TOI, the Vijay Mallya-promoted company
has defaulted in repayment of loans to banks and financial
institutions, for which several lenders have had to take a hit by
setting aside more funds, with overdues estimated at nearly
INR800 crore at the end of March 2012.
Kingfisher, which has been unprofitable since it was created in
2005, accumulated losses of $1.9 billion between May 2005 and
June 30 of this year, The Wall Street Journal reported citing
Sydney-based consultant CAPA-Centre for Aviation. The airline
also owes about $2.5 billion to lenders, suppliers, leasing
companies and investors, the Journal added.
According to The Times of India, the company began showing signs
of weakness in November 2011 when it ran out of money to operate
most of its flights and started reducing its flights to cut cost.
The airline also failed to pay salaries to its employees for a
long time following which the employees went on an indefinite
strike. Its flying license was finally suspended in October 2012,
TOI reported.
K. M. COTEX: CRISIL Assigns 'B+' Rating to INR55MM Cash Credit
--------------------------------------------------------------
CRISIL has assigned its 'CRISIL B+/Stable' rating to the cash
credit facility of K. M. Cotex Pvt Ltd.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 55 CRISIL B+/Stable (Assigned)
The rating reflects KMCPL's below-average financial risk profile,
marked by high gearing and weak debt protection metrics, modest
scale of operations and susceptibility of its business and
profitability to changes in government policies and fluctuation
in cotton prices. These rating weaknesses are partially offset by
the benefits that KMCPL derives from its promoters' extensive
experience in the cotton ginning and pressing industry.
For arriving at the rating, CRISIL has treated unsecured
interest-bearing loans of INR21.4 million (as on March 31, 2012)
from promoters as neither debt nor equity because these loans are
subordinated to bank debt and will be retained in the business
over the medium term.
Outlook: Stable
CRISIL believes that KMCPL will maintain its business risk
profile, backed by the extensive experience of its promoters in
the textile industry, over the medium term. The outlook may be
revised to 'Positive' if the company increases its scale of
operations and operating margin, leading to significant
improvement in its cash accruals. Conversely, the outlook may be
revised to 'Negative' in case of any further pressure on KMCPL's
profitability or larger-than-expected increase in working capital
requirements, leading to further deterioration in its financial
risk profile, particularly its liquidity.
KMCPL, incorporated in 2007 is promoted by Mr. Vipin Jain and Mr.
Manoj Jain. The company is engaged in ginning and pressing of
cotton. The factory is based in Anjad, Madhya Pradesh.
KRIPA TELECOM: CARE Rates INR3cr Long-Term Loan at 'CARE B+'
------------------------------------------------------------
CARE assigns 'CARE B+' ratings to the long-term and 'CARE A4' to
the short term bank facilities of Kripa Telecom.
Amount
Facilities (INR crore) Ratings
----------- ----------- -------
Long-term Bank Facilities 3 CARE B+ Assigned
Short-term Bank Facilities 6 CARE A4 Assigned
Rating Rationale
The ratings are constrained by the weak financial risk profile of
the firm as evidenced by stressed capital structure and tight
liquidity, its small scale of operation and intensely competitive
industry. However, the ratings draw strength from the long
experience of the partners, established relationship with the
leading players in the lighting industry and the firm being a
certified and registered supplier of various Government bodies.
Kripa Telecom was established in the year 2000, by a team of
three professionals, Mr. D. Subhakar, Mr. P. Ramesh and Mr. P. P.
Rao. Kripa was initially engaged in the supplying of telecom
equipments (wired products, main distribution frames, RF Antennas
and RF Connectors) till 2007.
Subsequently, the firm shifted its focus in supplying of LED
lights to private companies and railways. Later, with growing
opportunities in solar space, the firm ventured into solar
solutions vertical and executed its first solar order during FY11
(refers to the period April 1 to March 31).
Presently, the firm is operating as a System Integrator (SI) for
solar orders and has successfully executed 13 solar projects
(which includes two solar power plant) till November 2012, having
an aggregate capacity of 181 KW.
During FY12, the company reported a PAT of INR0.3 crore on the
net sales of INR8.0 crore (as against a PAT of INR0.2 crore on
the net sales of INR6.7 crore during FY11).
NARSINGH ISPAT: CARE Assigns 'BB+' Rating to INR41.65cr LT Loan
---------------------------------------------------------------
CARE assigns 'CARE BB+' to long term bank facilities of Narsingh
Ispat Limited.
Amount
Facilities (INR crore) Ratings
----------- ----------- -------
Long term bank facilities 41.65 CARE BB+ Initial
Rating Rationale
The above rating is constrained by small size of operations, low
capacity utilisation, lack of backward integration vis-…-vis
volatility in prices, risks associated with on-going project, low
profit level & margin and cyclicality of steel industry, scarcity
of basic raw materials and competition from unorganized sector.
However, the rating derives strength from the experienced
promoters and comfortable gearing ratios. Successful completion
of the ongoing projects, increase in capacity utilisation &
improvement in profitability remains the key rating
sensitivities.
Narsingh Ispat Limited incorporated on Sept.30, 2004 was promoted
by Shri Anil Kumar Goyal of Kolkata. Currently, the company has a
65 cu mtr blast furnace (licensed capacity 45,000 tpa) along with
backward integration of sinter plant (commenced operation in
FY12) & waste recycling plant at Jharkhand. Apart from above, the
company is also engaged in trading of steel products (around 80%
of the total sales in FY12).
On total income of INR136.1 crore and, NIL earned PBILDT of
INR9.8 crore and PAT (after defd. tax) of INR1.4 crore in FY12.
As per H1FY13 results, the company has achieved an operating
income of INR66 crore and PAT of INR0.5 crore.
PRADEEP INDUSTRIAL: CARE Rates INR10.5cr LT Loan at 'CARE BB-'
--------------------------------------------------------------
CARE assigns 'CARE BB-' and 'CARE A4' ratings to the bank
facilities of Pradeep Industrial Packers Private Limited.
Amount
Facilities (INR crore) Ratings
----------- ----------- -------
Long-term Bank Facilities 10.50 CARE BB- Assigned
Short-term Bank Facilities 5.50 CARE A4 Assigned
Rating Rationale
The ratings assigned to the bank facilities of Pradeep Industrial
Packers Private Limited are constrained by the company's decline
in turnover during the review period due to change in the
nature of business profile, high counterparty default risk, low
profitability, leveraged capital structure, intense competition
in the industry and its exposure to the foreign exchange
fluctuation risk. The ratings, however, derive strength from the
experience of the promoters in the trading of polymers, del
credere agent for Indian Oil Corporation Ltd., improvement in the
profit margins during FY12 (refers to the period April 1 to
March 31) and the positive demand prospects for polymers in
India.
The ability of the company to improve its scale of operations
while improving its profit margin will remain the key rating
sensitivity.
PIPPL, incorporated in 1984 and currently managed by Mr. Murli
Manohar Saraf (Managing Director) and Mr. Karan Ramsisaria
(Director). PIPPL is engaged in the importing of Polymers
(Plastic Granules) and distribution of the same in the local
markets. In the year 2010, the company became a 'Del Credere'
agent and Consignment Stockist of M/s. Indian Oil Corporation
Ltd., a public sector undertaking (PSU), in the Karnataka Region
(Bangalore) for trading of polymer products. These polymer
products include High Density Polyethylene, Low density
Polyethylene, Polypropylene and Polystyrene of different grades.
RADHA KRISHNA: Assigns 'BB' Rating to INR25cr Long-Term Loan
------------------------------------------------------------
CARE assigns 'CARE BB' ratings to the bank facilities of Radha
Krishna Automobiles Private Limited.
Amount
Facilities (INR crore) Ratings
----------- ----------- -------
Long-term Bank Facilities 25 CARE BB Assigned
Rating Rationale
The rating of Radha Krishna Automobiles Private Ltd (RKAPL) is
constrained by the cyclical nature of the automobile industry,
intense competition among dealers leading to thin profit margins,
highly leveraged capital structure and working capital intensive
nature of operations. The ratings favourably factor in the
experience of the management team, long standing relationship
with Toyota, growth in sales volume and total operating income
over years along with growth in contribution to income from
allied services. The ability of company to improve the
profitability margins and capital structure and manage working
capital efficiently will be key sensitivities.
Radha Krishna Automobiles Private Limited (RKAPL), established in
December 2005 promoted by Mr M Subrahmanyam. RKAPL is an
authorized dealer of Toyota Kirloskar Motors Pvt Limited
(TKML) with its showroom at Sanathnagar, Hyderabad. RKAPL belongs
to Mithra Group of Vijayawada established in 1964 as a trading
organization. Through different joint ventures with JCBL, Kyokuto
Kaihatsu Kogyo Co Ltd group has ventured into manufacturing.
RKAPL has registered a PAT of INR0.25 crore out of a total income
of INR261.29 crore in FY12. As per unaudited numbers the company
achieved INR217.34 crore revenue for 7MFY13.
RED CHILLIES: CRISIL Assigns 'B' Rating to INR25MM Cash Credit
--------------------------------------------------------------
CRISIL has assigned its 'CRISIL B/Stable/CRISIL A4' ratings to
the bank loan facilities of Red Chillies Mercantile Pvt Ltd.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 25 CRISIL B/Stable (Assigned)
Export Packing Credit 105 CRISIL A4 (Assigned)
The ratings reflect RCMPL's modest scale of operations in the
highly fragmented and competitive readymade garment industry and
its below-average financial risk profile, marked by expected weak
capital structure. These rating strengths are partially offset by
the extensive industry experience of the company's promoters in
the readymade industry.
Outlook: Stable
CRISIL believes that RCMPL will continue to benefit over the
medium term from the extensive experience of its promoters in the
ready-made garments industry. The outlook may be revised to
'Positive' in case of improvement in the company's capital
structure or increase in its scale of operations and
profitability, leading to a better financial risk profile.
Conversely, the outlook may be revised to 'Negative' in case of
deterioration in RCMPL's working capital management, lower-than-
expected increase in its scale of operations and profitability,
and any significant debt-funded capital expenditure.
Incorporated in 2010, RCMPL manufactures ready-made garments for
men, women, and children. The daily operations are managed by Mr.
Ashish Karnani and Mr. Aloke Biyani.
SPECIAL ENGINEERING: CRISIL Ups Rating on INR65MM Loans to 'B+'
---------------------------------------------------------------
CRISIL has upgraded its rating on the long-term bank facilities
of Special Engineering Services Ltd to 'CRISIL B+/Stable' from
'CRISIL B/Stable', and has reaffirmed its rating on the company's
short-term facilities at 'CRISIL A4'.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 50.0 CRISIL B+/Stable(Upgraded from
'CRISIL B/Stable')
Letter of Credit & 65.0 CRISIL A4 (Reaffirmed)
Bank Guarantee
Term Loan 15.0 CRISIL B+/Stable (Upgraded
from 'CRISIL B/Stable')
The rating upgrade reflects SESL's track record of timely
servicing of its debt over the past 18 months. The upgrade also
factors in the company's continued strong financial risk profile
with a comfortable gearing of 0.4 times as on March 31, 2012, and
healthy debt protection metrics. Company's liquidity profile also
remains adequate as reflected in the low utilisation of its bank
lines, at an average of 33 per cent over the 12 months through
October 2012. However, SESL's rating remains partly constrained
by its declining turnover and operating profitability over the
past two years. SESL's turnover and operating margins have
declined to Rs 650 million and 5.89 per cent respectively in
2011-12 from INR119 million and 7.35 per cent in the previous
year. No improvement is expected in SESL's turnover and
profitability during 2012-13. CRISIL believes that the company's
ability to sustain its topline and profit margins would remain a
key rating sensitivity factor going forward.
The ratings also reflect SESL's large working capital
requirements, customer concentration in its revenue profile, and
its susceptibility to intense industry competition. These rating
weaknesses are partially offset by the extensive experience of
SESL's promoters in the automobile industry, and its strong
financial risk profile
Outlook: Stable
CRISIL believes that SESL will continue to benefit over the
medium term from the extensive industry experience of its
promoters. The outlook may be revised to 'Positive' if SESL's
business risk profile improves, supported by an increase in its
scale of operations and improvement in its profitability.
Conversely, the outlook may be revised to 'Negative' if the
company's financial risk profile deteriorates, most likely
because of lower-than-expected revenues or profitability, or
larger-than-expected debt-funded capital expenditure.
About Special Engineering
Set up in 1960, SESL is a joint venture of the C K Birla group
and Intrust AG (Switzerland). SESL manufactures automotive and
locomotive components such as axle boxes, magnetic frames,
catalytic converters, propeller shafts, and metallic seats. It
has manufacturing facilities in Kolkata (West Bengal), Chennai
(Tamil Nadu), Jaipur (Rajasthan), and Sanand (Gujarat).
SESL reported a profit after tax (PAT) of INR22 million on net
sales of INR601 million for 2011-12 (refers to financial year,
April 1 to March 31), as against a PAT of INR39 million on net
sales of INR1131 million for 2010-11.
SRI ANJANEYA: CARE Lowers Rating on INR22.2cr LT Loan to 'B+'
-------------------------------------------------------------
CARE revises the rating assigned to the long-term bank facilities
of Sri Anjaneya Agrotech Private Limited to 'CARE B+'.
Amount
Facilities (INR crore) Ratings
----------- ----------- -------
Long-term Bank Facilities 22.2 CARE B+ Revised from
CARE BB
Rating Rationale
The revision in the rating factors in the poor operational and
financial performance of Sri Anjaneya AgroTech Private Limited
during FY12 (refers to the period April 1 to March 30) and
H1FY13 resulting in the deterioration in the capital structure
and stretched liquidity position. The rating continues to be
constrained by medium scale of operations, working-capital
intensive nature of operations, volatility in the raw material
prices, geographical concentration risk and intense competition
in the industry. However, the rating continues to draw strength
from the experienced management and growing demand for the rice
bran oil. Going forward, the ability of the company to
effectively utilize available capacities and scale up the
operations while improving its profitability margins along with
improvement in the leverage parameters and liquidity position
will be the key rating sensitivities.
SAPL was incorporated by Mr A. S. Veeranna in October 2001. Mr A.
K. Prashant (managing director and promoter) looks after the day-
to-day operations of the company. The promoters have a
longstanding presence in the industry with 15 years of industrial
experience. The company is engaged in the manufacturing and
marketing of various edible oils such as rice bran/sunflower/soya
bean oil to wholesale and retail markets under the brand name
"Akshath" in the State of Karnataka. The company operates a
solvent extraction unit and refining unit of 500 MTPD and 100
MTPD installed capacities, respectively, at Davanagere,
Karnataka.
During FY12, SAPL incurred net loss of INR0.3 crore on a total
income of INR133.3 crore. For the six months ended September
2012, the company incurred net losses of INR0.1 crore on the
total income of INR42.8 crore.
VFPL ASIPL: CRISIL Rates INR42.5MM Cash Credit at 'B+'
------------------------------------------------------
CRISIL has assigned its 'CRISIL B+/Stable/CRISIL A4' ratings to
the bank loan facilities of VFPL ASIPL JV Company.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Bank Guarantee 16.3 CRISIL A4 (Assigned)
Cash Credit 42.5 CRISIL B+/Stable (Assigned)
The ratings reflect VAJC's small scale of operations, customer
concentration in its revenue profile, and below-average financial
risk profile. These rating weaknesses are partially offset by the
benefits that VAJC derives from its contract with Mahanadi
Coalfields Ltd and its promoter's extensive entrepreneurship
experience.
Outlook: Stable
CRISIL believes that VAJC will continue to benefit from its
promoter's extensive entrepreneurship experience. The outlook may
be revised to 'Positive' in case VAJC registers more-than-
expected improvement in its accruals or exhibits better-than-
expected working capital management, leading to improvement in
its liquidity, or in case the company substantially improves its
profitability while maintaining its revenues. Conversely, the
outlook may be revised to 'Negative' if VAJC experiences
premature termination of its contract with MCL, leading to
deterioration in its business risk profile, or its financial risk
profile, particularly its liquidity, weakens considerably, as a
result of lower-than-expected cash accruals, or deterioration in
its working capital management or substantially larger-than-
expected capital expenditure.
VAJC, set up in 2010, is a joint venture between Vinay Fastners
Pvt Ltd and Aloke Steels Industries Pvt Ltd (rated 'CRISIL
BBB/Stable/CRISIL A3+'). It was established to undertake a mining
tender in Lakhanpur (Jharsuguda District, Odisha) worth INR984
million from MCL in 2010. Commercial operations started in 2011-
12 (refers to financial year, April 1 to March 31) and the tender
is expected to be completed in the third quarter of 2015-16.
=========
J A P A N
=========
* JAPAN: Credible Fiscal Strategy Key Issue, Fitch Says
-------------------------------------------------------
The central issue for Japan's sovereign credit rating remains the
developing and implementing of a credible fiscal strategy to
stabilize government debt over the medium term, Fitch Ratings
says.
Shinzo Abe's new Liberal Democratic Party (LDP) government
appears to be committed to reflating the economy via fiscal,
monetary and investment-promotion policies (the "three arrows").
The government has taken its first step in implementing these
policies with a JPY10 trillion (USD112 billion, 2.2% of 2013 GDP)
stimulus package, announced on Jan. 11 and approved by the
cabinet last week.
"Our downgrade of Japan to 'A+' in May 2012, and the Negative
Outlook on the rating, already reflect the risk posed by high and
rising general government debt ratios. The size of the fiscal
stimulus package is not large enough to alter the rating; but as
we said at the time of the downgrade, a lack of new fiscal policy
measures aimed at stabilising public finances amid further rises
in General Government Debt ratios could lead to a downgrade,"
Fitch says.
"The stimulus package will entail around JPY5.2trn of
construction bond issuance, breaching the limit on annual net JGB
issuance of JPY44trn set out under the Fiscal Management
Strategy. Thus it appears to abandon an integral part of the
previous administration's fiscal framework. Mr. Abe has indicated
that he will outline his own government's medium-term fiscal
policy in June. We will assess this in due course as part of our
reviewing the new government's fiscal and economic strategy as a
whole.
"A staggered 5pp rise in the consumption tax to 10% in 2014-15
was the centrepiece of the previous government's fiscal
consolidation plan, expected to yield about 2.5% of GDP in
additional revenue. Mr. Abe has said he will review the
desirability of the hike in light of economic data in 2013. By
itself, postponement of the increase would be negative for the
fiscal outlook. But as the hike was only scheduled to happen in
2014-15, there should be sufficient time for Fitch to take stock
of any new fiscal strategy before resolving the Negative Outlook.
"Mr. Abe has also reiterated his call for the Bank of Japan to
adopt an inflation target of 2%, via additional monetary easing
if necessary. The fall in the currency since the election
indicates the credibility that currency markets ascribe to Mr.
Abe's stated desire to loosen the monetary policy framework.
Japan's export-driven economy means sustained yen depreciation
may be the easiest single way to boost growth (although the
impact would be likely to vary across sectors).
"Over the longer term, structural reform to enhance the economy's
growth potential would be more supportive than one-off spending
packages for Japan's sovereign ratings, which incorporate our
expectation of weak real and nominal GDP growth."
=====================
P H I L I P P I N E S
=====================
* PHILIPPINES: Public Finances Show Improvement, Fitch Says
-----------------------------------------------------------
Fitch Ratings says in a new report that the Philippines' public
finances have become less of a drag on the sovereign credit
profile. Sustained efforts under the Aquino and Arroyo
administrations to improve fiscal management have brought many
key fiscal metrics in line with or stronger than 'BB' and 'BBB'
range peer medians.
General government debt/GDP ratio, estimated to be 40.3% at end-
2012, is on a par with 'BB and 'BBB' medians' 40%. Lengthening
the maturity profile of national government debt to 10.7 years,
compared with a 'BB' range median of 3.5 years, is also
supportive of sovereign creditworthiness.
Fitch says the fiscal revenue base remains the key outstanding
weakness in the public finances. Estimated at 18.4% of GDP in
2012, it is well below both the 'BB' and 'BBB' range peer medians
of 27% and 34%. This impedes fiscal liquidity, reflected in a
debt/revenue ratio of 220%, significantly above the 'BB' range
median of 163%. It also potentially constrains fiscal resources
for public investment in the infrastructure, health and education
sectors of the economy. The implementation of revenue-enhancing
measures, such as the recently passed "sin tax" bill, is
potentially credit-positive, though execution risks remain high.
The Aquino administration's efforts to improve the quality and
effectiveness of public expenditures are seen as supportive.
While implementation of these efforts created an initial drag on
GDP growth, improved fiscal transparency and reduced corruption
leakages could help deliver longer-term benefits to the economy
and address weaknesses elsewhere in the sovereign credit profile.
The authorities' efforts to improve fiscal management on a more
technical level, such as lengthening the maturity profile and
increasing the reliance on domestic issuance, also support the
sustainability of the public finances and have complemented
ongoing improvements in the institutional framework.
The Philippines is rated Long-Term Foreign and Local Currency
Issuer Default 'BB+' and 'BBB-' respectively, with Stable
Outlook.
===============
X X X X X X X X
===============
* Moody's Says India & Vietnam Exhibit Negative Outlooks
--------------------------------------------------------
Moody's Investors Service says that the broad credit outlook for
banks in the Asia Pacific region in 2013 is stable on the
expectation that they will remain largely insulated from the
negative credit pressures affecting their peers in many Western
economies.
"We consider that this stable outlook is driven mainly by the
region's economic resilience; its relatively accommodative
monetary policy; and the banks' own strong liquidity when
compared to global norms, as well as their relatively robust
capital buffers," says Stephen Long, the Managing Director for
Moody's Financial Institutions Group in Asia Pacific.
Mr. Long was speaking on the release of Moody's "Asia Pacific
Banking Outlook 2013", which examines the trends for 14 banking
systems in the region. On an individual basis, a total of 11 show
stable outlooks, while the Philippines exhibits a positive
outlook, and India and Vietnam negative outlooks.
"For the region, in terms of specifics, we consider that the
economic recovery from the troughs reached in mid-2012 will
continue in much of the region in 2013. At the same time,
interest rates will remain low, making an asset quality shock
unlikely during this year in most Asian countries," says
Mr. Long. "In addition with liquidity, the vast majority of Asian
banks are ready to adopt Basel III capital standards, which are
being implemented in much of the region in 2013, even though some
Asian regulators have announced delays."
The report further examines six key themes for banks in Asia in
2013, including: the expectation that the modest cyclical
deterioration apparent, in asset quality should fade by mid-year;
the consideration that the region's very low interest rates --
while providing further reassurance that an asset quality shock
is unlikely -- are also creating longer-term risks; and the
expectation that Chinese banks although will avoid a hard
landing, longer-term issues remain unresolved.
In addition, the report argues that Asian banks are well-placed
to meet the capital standards of Basel III; the banks will carry
on with their overseas expansion, though at a more moderate pace
than that evident in 2012; and while the region's regulators will
focus on ensuring that new-generation capital instruments meet
Basel III requirements, they will still refrain from seeing any
urgency in pressing ahead with broader resolution tools that
could impose losses on creditors.
In terms of individual banking systems, the report says that with
the Chinese banks, the risks of a systemic crisis materializing
in 2013 are low. And while loans to real estate developers and to
local government financing vehicles (LGFV) will remain sources of
long-term asset quality concerns, Moody's sees the risks of
significant distress in 2013 as contained, respectively by a
recovering real estate sector and the Chinese government's active
management of the LGFV refinancing process.
With Japan, the credit conditions for its banks will remain
stable despite a generally weak economic outlook. The major banks
will continue to take advantage of their relatively strong
financial profiles and the retreat of European banks by expanding
overseas, both in terms of their loan books and in terms of
strategic investments.
For banks in several export-related economies, such as Hong Kong,
Singapore, Taiwan, Malaysia, Korea and Thailand, macroeconomic
recovery will mean that any cyclical rise in non-performing loans
(NPLs) will be modest.
However, tightening liquidity (except for Korea, where Moody's
expects loan-to-deposit ratios to continue to decline) will
remain a feature as these banks' dollar loan books will keep
outstripping deposit gathering in their own currencies.
The outlook for banks in Australia and New Zealand remains stable
as these economies continue to exhibit good growth prospects in
the near-term, driven by ongoing resources-sector investments in
Australia and earthquake reconstruction in New Zealand.
With the positive outlook for the Philippines, Moody's says its
banking system will remain relatively immune to global shocks and
continue to benefit from steady credit growth. Indonesia shares
many of these positive attributes, but Moody's stable system
outlook includes more policy uncertainty, as well as greater risk
of asset quality pressures due to relatively rapid recent loan
growth.
At the other extreme, Vietnam and India have negative outlooks.
The Vietnamese system is in much worse shape than India's and
there is a reasonably high probability that the government will
need to step in and take measures to address the issue of high
NPLs, or face the negative economic consequences of a banking
system that cannot support credit growth.
And in India, impaired loans are yet to peak among public sector
banks. While the government is likely to remain supportive,
relatively high inflation and modest fiscal capacity mean that
policy options are constrained.
* Upcoming Meetings, Conferences and Seminars
---------------------------------------------
Feb. 20-22, 2013
AMERICAN BANKRUPTCY INSTITUTE
VALCON
Four Seasons Las Vegas, Las Vegas, Nev.
Contact: 1-703-739-0800; http://www.abiworld.org/
Apr. 10-12, 2013
TURNAROUND MANAGEMENT ASSOCIATION
TMA Spring Conference
JW Marriott Chicago, Chicago, Ill.
Contact: http://www.turnaround.org/
Apr. 18-21, 2013
AMERICAN BANKRUPTCY INSTITUTE
Annual Spring Meeting
Gaylord National Resort & Convention Center,
National Harbor, Md.
Contact: 1-703-739-0800; http://www.abiworld.org/
June 13-16, 2013
AMERICAN BANKRUPTCY INSTITUTE
Central States Bankruptcy Workshop
Grand Traverse Resort, Traverse City, Mich.
Contact: 1-703-739-0800; http://www.abiworld.org/
July 11-13, 2013
AMERICAN BANKRUPTCY INSTITUTE
Northeast Bankruptcy Conference
Hyatt Regency Newport, Newport, R.I.
Contact: 1-703-739-0800; http://www.abiworld.org/
July 18-21, 2013
AMERICAN BANKRUPTCY INSTITUTE
Southeast Bankruptcy Workshop
The Ritz-Carlton Amelia Island, Amelia Island, Fla.
Contact: 1-703-739-0800; http://www.abiworld.org/
Aug. 8-10, 2013
AMERICAN BANKRUPTCY INSTITUTE
Mid-Atlantic Bankruptcy Workshop
Hotel Hershey, Hershey, Pa.
Contact: 1-703-739-0800; http://www.abiworld.org/
Aug. 22-24, 2013
AMERICAN BANKRUPTCY INSTITUTE
Southwest Bankruptcy Conference
Hyatt Regency Lake Tahoe, Incline Village, Nev.
Contact: 1-703-739-0800; http://www.abiworld.org/
Oct. 3-5, 2013
TURNAROUND MANAGEMENT ASSOCIATION
TMA Annual Convention
Marriott Wardman Park, Washington, D.C.
Contact: http://www.turnaround.org/
Nov. 1, 2013
AMERICAN BANKRUPTCY INSTITUTE
NCBJ/ABI Educational Program
Atlanta Marriott Marquis, Atlanta, Ga.
Contact: 1-703-739-0800; http://www.abiworld.org/
Dec. 2, 2013
BEARD GROUP, INC.
19th Annual Distressed Investing Conference
The Helmsley Park Lane Hotel, New York, N.Y.
Contact: 240-629-3300 or http://bankrupt.com/
Dec. 5-7, 2013
AMERICAN BANKRUPTCY INSTITUTE
Winter Leadership Conference
Terranea Resort, Rancho Palos Verdes, Calif.
Contact: 1-703-739-0800; http://www.abiworld.org/
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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.
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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., Washington, D.C., USA.
Valerie U. Pascual, Marites O. Claro, Joy A. Agravante, Rousel
Elaine T. Fernandez, Ivy B. Magdadaro, Frauline S. Abangan, and
Peter A. Chapman, Editors.
Copyright 2013. 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$775 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
Peter Chapman at 215-945-7000 or Nina Novak at 202-241-8200.
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