/raid1/www/Hosts/bankrupt/TCRAP_Public/130603.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
Monday, June 3, 2013, Vol. 16, No. 108
Headlines
A U S T R A L I A
ANNANDALE HOTEL: Sydney Publican Buys Hotel
LISA HO: Myer Considers Buying Fashion Chain
PACT GROUP: Moody's Assigns Definitive Ba3 Rating
SERIES 2012-1E: Fitch Affirms 'BB' Rating on Class E Certs.
C H I N A
CHINA GREEN: Incurs $177,000 Net Loss in First Quarter
CHINA TELETECH: Posts $61,800 Net Income in First Quarter
CHINA OIL: $350MM Senior Secured Bonds Get Moody's Ba1 Rating
WINSWAY COKING: Moody's Lowers CFR to B3; Outlook is Negative
I N D I A
AISHWARYA INFRA: CRISIL Reaffirms 'B+' Rating on INR100MM Loan
ANIIRUDH ENTERPRISES: CRISIL Places 'D' Ratings on INR50MM Loans
DEVGAN RICE: CRISIL Rates INR110MM Cash Credit at 'CRISIL B'
E ORIENTAL: CRISIL Assigns 'BB-' Ratings to INR60MM Loans
ESSAR STEEL: Posts INR2,784cr Net Loss in Fiscal Year 2013
GENPACT LTD: Loan Amendments No Impact on Ba2 CFR
JAYESH INDUSTRIES: CRISIL Cuts Rating on INR149.4MM Loans to 'D'
KALYANI RENEWABLE: CRISIL Lowers Rating on INR700MM Loans to 'D'
LAND MARK: CRISIL Rates INR100MM LT Loan at 'CRISIL B+'
OCTANT INDUSTRIES: CRISIL Cuts Rating on INR150MM Loan to 'D'
PEE JAY: CRISIL Assigns 'B' Ratings to INR85MM Loans
RADHADAMODAR MULTIPURPOSE: CRISIL Rates INR40.2MM Loan at 'B'
SILVER SPRING: CRISIL Assigns 'D' Ratings to INR240.9MM Loans
SRI MAHALAKSHMI: CRISIL Assigns 'B+' Ratings to INR50MM Loans
TATA MOTORS: Jaguar Land Rover Sales Buoy FY2013 Results
WRITER LIFESTYLE: CRISIL Reaffirms 'BB' Ratings on INR1.3BB Loans
YARLAGADDA AGROS: CRISIL Rates INR50MM Cash Credit at 'B'
YETURU BIO-TECH: CRISIL Assigns 'D' Ratings to INR92MM Loans
I N D O N E S I A
PROFESIONAL TELEKOMUNIKASI: Fitch Affirms 'BB' Long-Term FC IDR
PROFESIONAL TELEKOMUNIKASI: Refinancing No Impact on Ratings
J A P A N
ARCH FINANCE 2007-1: Moody's Downgrades Dual Currency Loan to Ba2
L-JAC FIVE: S&P Lowers Rating on Class B Certificate to 'D'
PANASONIC CORP: Plans to Slash 5,000 Jobs Over Three Years
N E W Z E A L A N D
GENESIS ENERGY: S&P Affirms BB- Rating on NZ$275MM Capital Bonds
LOMBARD FINANCE: CA Rejects Directors' Conviction Appeal
NEW TALISMAN: Annual Loss Widens to NZ$914,265
S O U T H K O R E A
STX GROUP: Banks May Supply More Liquidity to Shipbuilding Unit
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A U S T R A L I A
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ANNANDALE HOTEL: Sydney Publican Buys Hotel
-------------------------------------------
The Annandale Hotel, which has been in receivership since
February, has been sold to a prominent Sydney publican. Contracts
for sale were exchanged on May 30, 2013.
Ferrier Hodgson partner Morgan Kelly, receiver of the Annandale,
said in a statement the property would not be subject to
residential redevelopment, as incorrectly reported earlier last
week.
Mr. Kelly said he had received hundreds of e-mails expressing
support for the venue during the period of the receivership.
"During the course of the receivership and the sale campaign, many
supporters expressed their concern for the future of the Annandale
via e-mail. I'd encourage all those supporters to demonstrate
their commitment to the future success of the Annandale by
visiting the pub and buying a few beers," Mr. Kelly said.
The Annandale was built in the 1930s and became a live music
venue in the early 1980s.
LISA HO: Myer Considers Buying Fashion Chain
--------------------------------------------
The Australian reports that department store chain Myer is
believed to be circling Australian fashion brand Lisa Ho, which
collapsed in May with debts of nearly AUD11 million.
Myer is believed to be one of four parties that have executed
confidentiality agreements and been given access to a data room
for the business, the Australian says.
"We have been clear that we have been looking at strategic
opportunities that meet our investment criteria," the report
quotes a Myer spokeswoman as saying. "We have proven that with
the acquisition of Sass and Bide, Trent Nathan and Wayne Cooper."
According to the report, administrator Barry Taylor said there
were "ongoing negotiations with a number of parties". He said Lisa
Ho was an iconic brand and "people perceive that it has value, so
we are hopeful," the report relays.
The Australian relates that Mr. Taylor said he envisaged the
assets would be sold out of the companies but that "there was
still a possibility that a deed of company arrangement will be put
up to creditors which will give them a superior return than they
might expect if the companies went into liquidation".
Since the collapse of the company on May 8, early forensic
investigations have found that a combination of some questionable
operating decisions, bad market conditions and accounting
irregularities affected the viability and cashflow of the
business, according to the Australian.
Allegations have emerged that money may have been misappropriated
by people within the company. There is no suggestion Ms. Ho was
involved.
A source told The Australian that before the company went into
administration "other people were putting cash in to support her.
Cashflow got very tight this year."
Six of the 10 Lisa Ho stores have now been closed, along with one
clearance store, the report notes.
PACT GROUP: Moody's Assigns Definitive Ba3 Rating
-------------------------------------------------
Moody's Investors Service assigned a definitive Ba3 corporate
family rating to Pact Group Industries Pty Ltd. At the same time
Moody's has assigned a definitive Ba3 rating to a Senior Secured
Syndicated Facility entered into by Pact Group (USA), Inc. and
Senior Secured Revolving Facilities entered into by Pact Group Pty
Ltd and Pact Group Holdings (NZ) Limited. The outlook on the
ratings is stable. The Senior Secured Facilities were originally
assigned a provisional (P)Ba3 rating on 6 May 2013; the assignment
of the definitive Ba3 rating follows review of the final
documentation.
The loans rated are:
$885 million Senior Secured Facility due May 2020
AUD75 million Senior Secured Revolving Facility due May 2018
NZD30 million Senior Secured Revolving Facility due May 2018
The loans are guaranteed by Pact Group Industries Pty Ltd and
certain of its subsidiaries.
Ratings Rationale:
"Pact's Ba3 rating reflects its strong market position in the
Australian/New Zealand (ANZ) rigid plastics market in which it is
the largest manufacturer with a market share estimated to be in
excess of 40%", says Maurice O'Connell, a Moody's Vice President -
- Senior Analyst. "Pact's market leadership is underpinned by a
national footprint of manufacturing facilities across ANZ. Its
size in a capital intensive industry allows it to provide a "one-
stop" and comprehensive offering to its customer base which
includes many major household consumer products", O'Connell adds.
The rating also reflects the expected capital structure post
recapitalization including materially weakened credit metrics, the
heightened leverage and lower interest cover in the next 1-2
years. The recapitalization will result in leverage (adjusted
Debt/EBITDA) increasing to around 5 times in FY2014 and adjusted
EBIT interest cover falling to around 1.8 times. Moody's expects
that Pact will, as in the past when leverage has exceeded 4 times,
reduce leverage over the medium term. This expectation is
reinforced by the more limited acquisition opportunities following
the rationalization that has taken place in the local industry
over the past few years.
Pact's rating considers the diverse nature of its customer base
with no single customer accounting for greater than 10% of sales.
Pact has long-standing multi-year relationships with its top
customers with multiple contracts across a number of products.
Pact has strong cost increase and decrease pass-through provisions
which typically extend beyond raw material price movements and
include broader cost increases. This has helped Pact to maintain a
profile of steady operating margins over time.
The rating additionally reflects the high proportion of revenues
derived from the more stable food and beverage end-markets. This
accounts for around 70% of revenue with the remainder coming from
a broad spectrum of other end markets including chemical,
household, industrial and health industries.
Under Moody's base case assumptions, it expects Pact's leverage to
remain at elevated levels over the next 12-24 months with adjusted
Debt/EBITDA falling from around 5 times to circa 4.5 times. EBIT
interest cover is expected to remain relatively low with adjusted
EBIT/Interest of around 1.8 times, albeit adjusted EBITDA/Interest
is more robust at around 3.0 times. High servicing costs also
restrain cashflow metrics with adjusted FCF/Debt expected to be
around 10-12% over the period.
These ratios may be challenged in the event of acquisitions that
Pact may undertake.
The stable outlook reflects an expectation that cashflow from
operations will remain strong and that credit metrics will improve
steadily over the next 1-2 years as Pact reduces leverage. The
stable outlook also considers Pact's adequate liquidity profile
with no refinancing risk over the next 2-3 years.
Financial metrics Moody's would consider for an upgrade include
Adjusted Debt/EBITDA ratio of 3.5x and adjusted EBIT/Interest of
greater than 2.5x on a consistent basis.
The ratings could be subject to negative rating pressure in the
event that the company's earnings and/or earnings margins are
impacted by more difficult operating conditions. This could be
evidenced by EBIT margins falling to below 10%. Financial metrics
that Moody's would consider for a downgrade include Adjusted
Debt/EBITDA exceeding 5.0x on a consistent basis and adjusted
EBIT/Interest coverage falling and remaining below 1.2x.
The principal methodology used in this rating was Global Packaging
Manufacturers: Metal, Glass, and Plastic Containers Industry
Methodology published in June 2009.
SERIES 2012-1E: Fitch Affirms 'BB' Rating on Class E Certs.
-----------------------------------------------------------
Fitch Ratings has affirmed Series 2012-1E REDS EHP Trust and
Series 2012-1E REDS Trust, a securitisation of first-ranking small
balance auto loans and Australian residential mortgages originated
by Bank of Queensland Equipment Finance Ltd and the Bank of
Queensland (BoQ, 'BBB+'/Stable/'F2') respectively. The rating
actions are as follows:
Series 2012-1E REDS EHP Trust
-- AUD216.1m Class A-2A (ISIN AU0000RFAHA9) affirmed at 'AAAsf';
Outlook Stable
-- GBP69.1m Class A-2G (ISIN XS0784745050) affirmed at 'AAAsf';
Outlook Stable
-- AUD25.7m Class B (ISIN AU3FN0015558) affirmed at 'AAsf';
Outlook Stable
-- AUD20.5m Class C affirmed at 'Asf'; Outlook Stable
-- AUD19.7m Class D affirmed at 'BBBsf'; Outlook Stable
-- AUD18m Class E affirmed at 'BBsf'; Outlook Stable
Series 2012-1E REDS Trust
-- AUD651.2m Class A1 (ISIN AU3FN0017281) affirmed at 'AAAsf';
Outlook Stable
-- AUD50m Class A2A (ISIN AU3FN0017299) affirmed at 'AAAsf';
Outlook Stable
-- GBP100m Class A2S (ISIN XS0857670110) affirmed at 'AAAsf';
Outlook Stable
-- AUD45.1m Class AB (ISIN AU3FN0017307) affirmed at 'AAAsf';
Outlook Stable
-- AUD20.1m Class B (ISIN AU3FN0017315) affirmed at 'AA-sf';
Outlook Stable
Key Rating Drivers
The rating actions reflect Fitch's view that credit enhancement
levels are able to support the notes' current ratings. The credit
quality and performance of the loans in the respective collateral
pools remain in line with the agency's expectations.
Principal is being allocated pro rata since April-2013 as step-
down test conditions have been satisfied for the Series 2012-1E
REDS EHP transaction. For the Series 2012-1E REDS Trust,
principal collections are being allocated to the repayment of the
class A1 notes which have benefited from an increase in credit
enhancement due to sequential amortisation and seasoning since
issuance.
The Series 2012-1E REDS EHP Trust as at end-April 2013, had 30+
day arrears at 0.14% of the underlying auto loan balance, while
cumulative losses stood at AUD1.7m, all of which have been
recovered through excess spread. The excess spread reserve has
reached the maximum balance permitted under the documents, of
AUD2.31 million, and will be available to cover any potential
future losses.
Series 2012-1E REDS Trust closed in November 2012 and had
relatively small time period to report arrears and losses. When
compared with other similar transactions, arrears and losses over
this time span have been comparable and are below Fitch's Dinkum
Index. As at April 30, 2013, 30+ arrears stood at 0.5% of the
residential portfolio; while there has been one foreclosure to
date, there has been no realised loss incurred by the transaction.
All loans in the pool are covered by mortgage insurance from QBE
Lenders' Mortgage Insurance Limited ('AA-'/Stable) and Genworth
Financial Mortgage Insurance Pty Ltd.
Rating Sensitivities
In Fitch's rating sensitivity analysis, the likelihood of a
downgrade of the senior note classes is remote, based on
transaction performance.
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C H I N A
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CHINA GREEN: Incurs $177,000 Net Loss in First Quarter
------------------------------------------------------
China Green Creative, Inc., filed with the U.S. Securities and
Exchange Commission its quarterly report on Form 10-Q disclosing
a net loss of $177,275 on $247,968 of revenues for the three
months ended March 31, 2013, as compared with net income of
$49,397 on $682,358 of revenues for the same period during the
prior year.
The Company's balance sheet at March 31, 2013, showed $6.63
million in total assets, $7.26 million in total liabilities and a
$629,368 total stockholders' deficiency.
A copy of the Form 10-Q is available for free at:
http://is.gd/qWTfh6
About China Green
China Green Creative, Inc., located in Shenzhen, Guangdong
Province, People's Republic of China, is principally engaged in
the distribution of consumer goods and electronic products in the
PRC.
China Green disclosed net income of $635,873 on $6.87 million of
revenues for the year ended Dec. 31, 2012, as compared with a net
loss of $344,901 on $1.92 million of revenue during the prior
year.
Madsen & Associates CPA's, Inc., in Salt Lake City, Utah, issued a
"going concern" qualification on the consolidated financial
statements for the year ended Dec. 31, 2012. The independent
auditors noted that the Company does not have the necessary
working capital to service its debt and for its planned activity,
which raises substantial doubt about its ability to continue as a
going concern.
CHINA TELETECH: Posts $61,800 Net Income in First Quarter
---------------------------------------------------------
China Teletech Holding, Inc., filed with the U.S. Securities and
Exchange Commission its quarterly report on Form 10-Q disclosing
net income of US$61,866 on $9.10 million of sales for the three
months ended March 31, 2013, as compared with net income of
$1.63 million on $3.03 million of sales for the three months ended
March 31, 2012.
The Company's balance sheet at March 31, 2013, showed
$2.29 million in total assets, $2 million in total liabilities and
$297,675 in total stockholders' equity.
WWC, P.C., in San Mateo, California, issued a "going concern"
qualification on the consolidated financial statements for the
period ended March 31, 2013. The independent auditors noted that
the Company has incurred substantial losses, and has difficulty to
pay the PRC government Value Added Tax and past due Debenture
Holders Settlement, all of which raise substantial doubt about its
ability to continue as a going concern."
A copy of the Form 10-Q is available for free at:
http://is.gd/cVXC3S
About China Teletech
Tallahassee, Fla.-based China Teletech Holding, Inc., is a
national distributor of prepaid calling cards and integrated
mobile phone handsets and a provider of mobile handset value-added
services. The Company is an independent qualified corporation
that serves as one of the principal distributors of China Telecom,
China Unicom, and China Mobile products in Guangzhou City.
On June 30, 2012, the Company strategically sold its wholly-owned
subsidiary, Guangzhou Global Telecommunication Company Limited
("GGT"), to a third party. GGT was engaged in the trading and
distribution of cellular phones and accessories, prepaid calling
cards, and rechargeable store-value cards.
China Teletech disclosed net income of US$53,542 on US$26.62
million of sales for the year ended Dec. 31, 2012, as compared
with a net loss of US$348,124 on US$18.84 million of sales for the
year ended Dec. 31, 2011.
CHINA OIL: $350MM Senior Secured Bonds Get Moody's Ba1 Rating
-------------------------------------------------------------
Moody's Investors Service has assigned a definitive Ba1 rating to
the $350 million, 5.25%, 5-year, senior unsecured bonds, due 25
April, 2018 and issued by China Oil and Gas Group Limited (COG).
The rating outlook is stable.
Ratings Rationale:
Moody's definitive rating on this debt obligation follows COG's
successful completion of its USD bond issuance, the final terms
and conditions of which are consistent with Moody's expectations.
The provisional rating was assigned on April 9, and Moody's
ratings rationale was set out in a press release published on the
same day.
The company will use the proceeds from the issuance to fund
capital expenditure, to refinance existing indebtedness and for
other general corporate purposes.
The principal methodology used in this rating was Regulated
Electric and Gas Utilities published in August 2009.
China Oil And Gas Group Limited (COG) engages in the piped city
gas business, as well as the transportation and distribution of
compressed natural gas (CNG), and liquefied natural gas (LNG). As
at end-2012, it had 51 piped city natural gas concession rights in
13 provinces and one autonomous region, 36 CNG/LNG gas stations,
and natural gas branch pipelines of 822 km in seven provinces for
mid-stream distribution. Its piped city gas projects cover 523,400
households and 4,690 commercial and industrial customers and other
users. In 2012, its gas sales volume totaled 1,930 million cubic
meters.
COG was listed on the Hong Kong Stock Exchange in 1993 and began
engaging in the natural gas distribution business in 2002. Mr. Xu
Tie-liang is the largest shareholder and chairman, with a 22.5%
stake in the company.
WINSWAY COKING: Moody's Lowers CFR to B3; Outlook is Negative
-------------------------------------------------------------
Moody's Investors Service has downgraded Winsway Coking Coal
Holdings Ltd's corporate family rating to B3 from B2 and its
senior unsecured debt ratings to Caa1 from B3.
The ratings outlook is negative. This concludes the review for
downgrade initiated on April 3, 2013
Ratings Rationale:
"The downgrade reflects our expectation that Winsway's
profitability will continue to be under pressure and its EDITDA in
the next 12 months will not improve from 2012. Thus, debt leverage
-- measured by Debt/EBITDA -- is expected to be weak at 12x --
15x, which positions the company in the lower B level," says Alan
Gao, a Moody's Vice President and Senior Analyst.
The current commodity down-cycle has severely decreased profit
margins at Winsway's core coal trading and logistics business.
After including transportation costs of HKD200-210 per ton,
Moody's estimates that gross margin at its core Mongolian coal
trading business shrank by more than 80% to around HKD70 per ton
in 1Q 2013 from HKD377 per ton in 2010.
Similarly, the gross margin for its seaborne coal trading business
contracted by 70% to below HKD60 per ton in 1Q 2013 from over
HKD200 per ton in 2010.
The operating loss at its upstream investment of Grande Cache
Corporation is also contributing to its falling profit margin. GCC
is unlikely to show a positive contribution to profits in 2013 due
to the difficulties it faces in rapidly increasing production and
weak coking coal prices.
Winsway wishes to compensate for the margin contraction by
increasing its throughput volume at its logistics business with
new initiatives, including those relating to iron ore trading &
logistics. But Moody's believes that this volume-driven strategy
could be challenging, given the weak macroeconomic environment.
And the profit contribution from such new businesses will be small
as their gross margin is lower than the coal business.
"Moreover, the downgrade considers the company's weakening
liquidity due to the increased working capital requirements for
funding its volume-driven strategy and the continuous cash drain
at GCC for the purpose of supporting the ramping up of its
operations," says Gao.
Winsway's liquidity position continues to weaken. Its total
cash/short-term debt (including bills payable) coverage ratio
dropped below 96% at the end of 2012 from 174% in the prior year.
This reflects a lack of improvement in working capital management.
Moody's estimates that Winsway's cash balance declined in 1Q 2013
due to its falling profit margin, as it pursues higher trading
volumes and because of capital expenditures at GCC. Moody's will
monitor this deterioration. If there are no remedial actions to
stop this negative trend, further downgrade actions could be
possible.
The negative outlook reflects Moody's concerns over Winsway's
ability to manage its high-cost inventory, return to
profitability, ramp up its upstream investment in GCC, and
maintain adequate liquidity to sustain its business in the long
run.
The ratings are unlikely to be upgraded in the near term, given
the negative outlook. However, Moody's would change the outlook to
stable if the company can: (1) return to profitability and
maintain EBITDA margin of around 10% on a sustainable basis; (2)
improve the GCC business by successfully ramping up its production
volume, reducing its unit cost, and stabilizing the subsidiary's
funding structure; and (3) improve its liquidity position.
On the other hand, the ratings could be further downgraded if
Winsway's financial profile worsens, as indicated by: (1)
operating losses over an extended period; (2) a lack of
improvement in its inventory position; or (3) further
deterioration in its liquidity position.
Winsway Coking Coal Holdings Limited's ratings were assigned by
evaluating factors that Moody's considers relevant to the credit
profile of the issuer, such as the company's (i) business risk and
competitive position compared with others within the industry;
(ii) capital structure and financial risk; (iii) projected
performance over the near to intermediate term; and (iv)
management's track record and tolerance for risk. Moody's compared
these attributes against other issuers both within and outside
Winsway Coking Coal Holdings Limited's core industry and believes
Winsway Coking Coal Holdings Limited's ratings are comparable to
those of other issuers with similar credit risk.
Winsway Coking Coal is one of the largest suppliers of coking coal
in China, and obtains its supplies from Mongolia and other
international markets. It also processes coal and provides
logistics services to its customers, mainly Chinese steel makers
and coke plants, through its integrated supply chain for coking
coal in China. It listed on the Hong Kong Stock Exchange in
October 2010, and is 49.7% owned by its founder and CEO Wang
Xingchun.
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I N D I A
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AISHWARYA INFRA: CRISIL Reaffirms 'B+' Rating on INR100MM Loan
--------------------------------------------------------------
CRISIL's rating on the bank facilities of Aishwarya Infrastructure
& Developers continue to reflect AID's exposure to implementation
risks related to its ongoing project, expected deterioration in
its financial risk profile because of its recent entry into real
estate development, its modest scale of operations in the
fragmented civil construction industry, and geographical and
customer concentration in its revenue profile. These rating
weaknesses are partially offset by the benefits that the firm
derives from its proprietor's extensive experience in the civil
construction industry and its moderate order book position.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Overdraft Facility 100 CRISIL B+/Stable (Reaffirmed)
Outlook: Stable
CRISIL believes that AID will continue to benefit from the
extensive experience of its proprietor in the civil construction
business. The outlook may be revised to 'Positive' if there is
substantial equity infusion to improve the capital structure.
Conversely, the outlook may be revised to 'Negative' in case of a
decline in the firm's profitability due to fewer civil
construction orders or stretch in its receivables, or in case the
firm contracts more-than-expected debt to fund its real estate
projects.
Update
Because of delays in project execution amid political issues in
Karnataka, AID's turnover sharply declined in line with CRISIL's
expectations to around INR200 million in 2012-13 (refers to
financial year, April 1 to March 31) from INR681 million in
2011-12. AID has an unexecuted order book of close to INR500
million as on March 31, 2013 mainly from the Karnataka Public
Works Department (KPWD) to be executed over the next 8 to 10
months. CRISIL believes that AID's revenues will improve over the
medium term on the back of its moderate order book and expected
increase in pace of order execution post the Karnataka elections.
High profitability led to healthy debt protection metrics, with
net cash accruals to total debt and interest coverage ratios of 58
per cent and 2.36 times, respectively, for 2011-12. The total debt
of around INR103 million as on March 31, 2012 consists mainly of
bank overdraft and small amount of vehicle loans. While the firm
was expected to contract additional debt for its real estate
project, it has been put on hold due to ongoing metro work in the
vicinity. Work is not likely to start until November 2013 and thus
the gearing of the firm will be comfortable, at less than 1 time,
over the medium term. The other project is expected to be funded
by advances from customers. Although there has been no equity
infusion over the past three years, the net worth is moderate, at
INR171.4 million as on March 31, 2012 backed, by high
profitability.
The net cash accruals, though reduced, are estimated at close to
INR130 million in 2012-13, against which the firm does not have
any term debt obligations. As on February 28, 2013, it has debtors
of close to INR210 million mainly stuck with the KPWD, leading to
high estimated gross current assets of 300 days as on that date.
AID reported, on a a profit after tax (PAT) of INR56.9 million on
net sales of INR681.5 million for 2011-12; the firm reported a PAT
of INR47.3 million on net sales of INR613.5 million for
2010-11.
Established in 1986, AID is engaged in civil construction works,
specialising in construction of roads and buildings, and repairs
and drainage work. The firm is a registered Class IA Contractor
with Public Welfare Department, Karnataka. In 2007-08, AID
ventured into real estate development, and is developing two large
commercial projects near the Majestic area in Bengaluru
(Karnataka).
ANIIRUDH ENTERPRISES: CRISIL Places 'D' Ratings on INR50MM Loans
----------------------------------------------------------------
CRISIL has assigned its 'CRISIL D' rating to the long-term bank
facilities of Aniirudh Enterprises. The rating reflects instances
of delay by AE in servicing its debt; the delays have been caused
by the firm's weak liquidity.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 46 CRISIL D
Term Loan 4 CRISIL D
AE also has a weak financial risk profile, marked by a small net
worth, a high gearing and weak debt protection metrics, small
scale of operations, high customer concentration in its revenue
profile, and large working capital requirements. However, AE
benefits from the extensive experience of its promoter in the
civil construction industry.
AE was set up as a proprietorship firm in 1998 by Mr. Vivek
Ramchandra Kawade. The firm is involved in the construction of
roads and tunnels in Maharashtra and Karnataka. Its head office is
in Mumbai (Maharashtra).
AE reported a profit after tax (PAT) of INR7.2 million on net
sales of INR185.7 million for 2011-12 (refers to financial year,
April 1 to March 31); the firm reported a PAT of INR4.5 million on
net sales of INR120.1 million for 2010-11.
DEVGAN RICE: CRISIL Rates INR110MM Cash Credit at 'CRISIL B'
------------------------------------------------------------
CRISIL has assigned its 'CRISIL B/Stable' rating to the bank
facility of Devgan Rice & General Mills.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 110 CRISIL B/Stable
The rating reflects DRGM's modest scale of operations in the
highly fragmented rice milling industry, working capital intensive
nature of operations and susceptibility of DRGM's revenues and
margins to regulatory changes and vagaries of monsoon. The rating
also factors in DRGM's below-average financial risk profile marked
by modest net worth and high gearing. These rating weaknesses are
partially offset by the partners' extensive experience in the rice
milling industry.
Outlook: Stable
CRISIL believes that DRGM will continue to benefit from its
partners' extensive experience in the rice milling industry. The
outlook may be revised to 'Positive' if the firm records
significant and sustained improvement in its revenues and capital
structure while maintaining its margins. Conversely, the outlook
may be revised to 'Negative' if there is decline in its revenues
or margins, elongation of its working capital cycle or it
undertakes large debt-funded capex leading to pressure on its
liquidity and weakening of its financial risk profile.
DRGM, setup as a partnership firm in 1972 by Mr. Naresh Kumar and
his family, is engaged in rice milling operations. DRGM has its
manufacturing facility in Amritsar, Punjab.
For 2012-13 (refers to financial year, April 1 to March 31), DRGM
reported, on a provisional basis, a profit after tax (PAT) of
INR4.7 million on net sales of INR230.0 million against a PAT of
INR1.2 million on net sales of INR143.9 million in 2011-12.
E ORIENTAL: CRISIL Assigns 'BB-' Ratings to INR60MM Loans
---------------------------------------------------------
CRISIL has assigned its 'CRISIL BB-/Stable/CRISIL A4+' ratings to
the bank facilities of E Oriental Timbers (EOT; part of Oriental
Timber group (OT group).
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Proposed Cash Credit Limit 10 CRISIL BB-/Stable
Cash Credit 50 CRISIL BB-/Stable
Foreign Letter of Credit 300 CRISIL A4+
The ratings reflect the extensive industry experience of OT
group's promoters, its established market position in the timber
trading and sawmill business, and its above-average financial risk
profile. These rating strengths are partially offset by the
group's modest scale of operations in an intensely competitive
industry, and susceptibility of the group's operating margin to
volatility in raw material prices and foreign exchange (forex)
rates.
For arriving at its ratings, CRISIL has combined the business and
financial risk profiles of EOT and Oriental Woods (ORW). This is
because the entities together referred to as the OT group, operate
in the same line of business and have significant operational and
financial linkages.
Outlook: Stable
CRISIL believes that the OT group will benefit over the medium
term from its promoters' extensive experience in the timber
trading industry. The outlook may be revised to 'Positive' if the
group significantly increases its scale of operations, coupled
with an improvement in profitability, resulting in a significant
and sustainable improvement in its cash accruals. Conversely, the
outlook may be revised to 'Negative' if the group's working
capital management weakens thereby constraining its liquidity
profile, or if the group undertakes a large debt-funded capital
expenditure, (capex) programme, thus causing its financial risk
profile to decline.
Set up in 2006 as a proprietorship firm, EOT trades and processes
timber. ORW, set up in 2001 as a partnership firm, also trades
timber. The OT group is managed by Mr. V P Rasheed and his family.
OT group reported a profit after tax (PAT) of INR2.4 million on
net sales of INR518.9 million for 2011-12 (refers to financial
year, April 1 to March 31), as against a PAT of INR3.9 million on
net sales of INR405.9 million for 2010-11.
ESSAR STEEL: Posts INR2,784cr Net Loss in Fiscal Year 2013
----------------------------------------------------------
The Hindu Business Line reports that Essar Steel's net loss has
more than doubled in the last fiscal to INR2,784.94 crore as its
performance was impacted by host of reasons including lower sales
and rise in interest payments. The flagship firm of Essar group
had posted a loss of INR1,251.56 crore in 2011-12.
Net sales declined by over 7 per cent to INR14,898.35 crore during
the last fiscal vis-a-vis INR16,056.53 crore of FY12, the company
said in a statement obtained by Hindu Business Line.
The company's total expenditure, at INR15,079.51 crore, overshot
its net sales last year as depreciation of Essar's assets
increased by over 58 per cent to INR1,562.21 crore, the report
discloses.
According to the report, the company also incurred a one time loss
of INR1,346.55 crore last year on account of stabilisation of its
new units. All these factors led to Essar reporting a net loss of
INR2,784.94 crore during the last fiscal.
However, the company appeared confident that in the coming years
it will return to profit making due to various measures already
taken. This includes steps taken to improve its liquidity.
The Hindu Business Line relates that Essar said the excess of its
current liabilities over its current assets include short term
borrowings of INR4,287.10 crore and current maturing of long term
debts of about INR2,544.29 crore.
To increase liquidity, the company has plans to raise loans of
longer tenure and convert some of its rupee debt into dollar loans
through external commercial borrowings and export securitisation,
Essar, as cited by Hindu Business Line, said.
Essar Steel India Limited engages in the production and sale of
steel products.
GENPACT LTD: Loan Amendments No Impact on Ba2 CFR
-------------------------------------------------
Moody's Investors Service says that the amendments to Genpact
Limited's senior secured term loan and senior secured revolving
credit facility have no immediate impact on the company's Ba2
corporate family rating and the senior secured bank credit
facility, or on the positive outlook on the ratings.
The two senior secured credit facilities are drawn by three of
Genpact's indirectly wholly owned subsidiaries, and guaranteed by
Genpact as well as by the company's other material subsidiaries.
"Despite a higher debt balance, Genpact remains well within the
parameters for its rating. Moreover, the increase in the size of
its term loan, to $875 million from $675 million, will bolster the
company's liquidity," says Alan Greene, a Moody's Vice President
and Senior Credit Officer.
"While we would be concerned if Genpact makes over aggressive
acquisitions or large distributions using the higher cash balance,
we take comfort in the company's sound track record and expect it
to retain its business model and to exercise prudence in future
acquisitions and distributions," adds Greene.
The size of Genpact's senior secured revolving credit facility
remains unchanged, at $250 million.
At the same time, the applicable interest rates for both loans
will be reduced by 75 basis points. In addition, the senior
secured term loan will have a reduction of 25 basis points on its
LIBOR floor while financial covenants attached to the term loan
will be removed. However, the consolidated leverage ratio of 2.5x
will remain for the revolving credit facility.
Over the next 6-12 months, the main factors that will impact
Genpact's ratings are its ability to maintain its margins, and to
drive growth and market share in a highly competitive market.
The principal methodology used in this rating was the Global
Business & Consumer Service Industry Rating Methodology published
in October 2010.
Genpact Limited provides customer relationship management and
other business process outsourcing (BPO) for companies in the
telecom, media and technology sectors. With some 60,000 employees
worldwide, predominantly in India, and around 700 clients, it is a
leading player in the BPO sector. Genpact is also increasingly
extending its operations into other areas such as network and
technology services. Listed on the New York Stock Exchange since
2007, Genpact reported total revenues of $1.9 billion and pre-tax
income of $263 million in the year ended December 2012.
JAYESH INDUSTRIES: CRISIL Cuts Rating on INR149.4MM Loans to 'D'
----------------------------------------------------------------
CRISIL has downgraded its ratings on the bank facilities of Jayesh
Industries Ltd to 'CRISIL D/CRISIL D' from 'CRISIL B/Stable/CRISIL
A4+'.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 75.0 CRISIL D (Downgraded from
'CRISIL BB/Stable')
Standby Line of 10.0 CRISIL D (Downgraded from
Credit 'CRISIL BB/Stable')
Bank Guarantee 2.0 CRISIL D (Downgraded from
'CRISIL A4+')
Letter of Credit 45.0 CRISIL D (Downgraded from
'CRISIL A4+')
Proposed Short-Term 17.4 CRISIL D (Downgraded from
Bank Loan Facility 'CRISIL A4+')
The ratings downgrade reflects instances of delay by Jayesh
Industries in servicing its debt obligations and overdrawls in its
cash credit account; the delays and overdrawls have been caused by
the company's weak liquidity resulting from its large working
capital requirements.
The ratings continue to reflect Jayesh Industries' below-average
financial risk profile marked by its small net worth, high gearing
and weak debt protection metrics, its limited pricing flexibility
and susceptibility of its profitability margins to volatility in
raw material prices. These rating weaknesses are partially offset
by the extensive experience of its promoters in the ferro alloy
industry, and its established relationships with its customers.
Jayesh Industries manufactures ferro alloy powders and lumps for
the electrodes industry and steel plants, respectively.
KALYANI RENEWABLE: CRISIL Lowers Rating on INR700MM Loans to 'D'
----------------------------------------------------------------
CRISIL has downgraded its rating on the long-term bank facilities
of Kalyani Renewable Energy India Ltd to 'CRISIL D' from 'CRISIL
B+/Stable'.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Proposed Long-Term 145 CRISIL D (Downgraded from
Bank Loan Facility 'CRISIL B+/Stable')
Term Loan 555 CRISIL D (Downgraded from
'CRISIL B+/Stable')
The rating downgrade reflects instances of delay by KRE in
servicing its debt; the delays have been caused by the company's
weak liquidity as its power plant has not commenced commercial
operations as was scheduled and there is an absence of timely
funding support from its promoters.
KRE is exposed to risks related to the implementation and
commissioning of its power project at Akola (Maharashtra).
However, the company benefits from the assured offtake of its
power output under a power purchase agreement (PPA) with
Maharashtra State Electricity Distribution Company Ltd, and its
promoter's experience in setting up biomass power plants.
KRE, incorporated in 2006, is setting up a 15-megawatt biomass
power generation plant at Balapur Mini Industrial Area in Akola.
The plant is expected to become operational by June 2013. KRE has
entered into a PPA with MSEDCL for sale of power. The promoter-
director Mr. V Narayana Rao has extensive entrepreneurial
experience in similar lines of business.
LAND MARK: CRISIL Rates INR100MM LT Loan at 'CRISIL B+'
-------------------------------------------------------
CRISIL has assigned its 'CRISIL B+/Stable' rating to the long-term
bank facility of Land Mark Infra Developers.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Long-Term Loan 100 CRISIL B+/Stable
The rating reflects LMD's exposure to risks related to project
implementation, which is currently in the nascent stage, and
exposure to risks inherent in the real estate industry. These
rating weaknesses are partially offset by the extensive experience
of LMD's proprietor in the real estate and construction industry.
Outlook: Stable
CRISIL believes that LMD will continue to benefit over the medium
term from the extensive experience of its proprietor in commercial
real estate development. The outlook may be revised to 'Positive'
in case the firm generates revenues as expected and achieves
higher-than-expected bookings, thereby strengthening its financial
flexibility and cash flow adequacies. Consequently, the outlook
may be revised to 'Negative' if LMD faces time or cost overrun in
project execution, or if the offtake of its on-going project is
lower than expected.
LMD was set up as a proprietary firm in April 2013 by Mr. Valluru
Ravindranath for the purpose of executing real estate projects.
The firm is currently developing a real estate property at
Labbipet in Vijayawada (Andhra Pradesh).
OCTANT INDUSTRIES: CRISIL Cuts Rating on INR150MM Loan to 'D'
-------------------------------------------------------------
CRISIL has downgraded its rating on the long-term bank facilities
of Octant Industries Ltd to 'CRISIL D' from 'CRISIL BB-/Stable'.
The rating downgrade reflects OIL's frequently overdrawn cash
credit account because of the company's weak liquidity, resulting
from its large working capital requirements.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 150.0 CRISIL D (Downgraded from
'CRISIL BB-/Stable')
Furthermore, OIL's operating margin is susceptible to volatility
in raw material prices, and the company is exposed to risks
related to implementation and stabilisation of its biomass power
project. However, OIL benefits from its promoter's extensive
experience in the castor oil derivatives business.
OIL was incorporated by Mr. Manmohan Sahu in Hyderabad (Andhra
Pradesh). The company manufactures castor oil derivatives and
undertakes contract farming for castor seeds. It is setting up a
10-megawatt (MW) biomass-based power generation unit in Sambalpur
(Orissa).
PEE JAY: CRISIL Assigns 'B' Ratings to INR85MM Loans
----------------------------------------------------
CRISIL has assigned its 'CRISIL B/Stable' rating to the bank
facilities of Pee Jay Imports Exports.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Bill Discounting 10 CRISIL B/Stable
Cash Credit 75 CRISIL B/Stable
The rating reflects Pee Jay's weak financial risk profile, marked
by high gearing and weak debt protection metrics, and modest scale
of operations, with customer concentration in its revenue profile.
These rating weaknesses are partially offset by the extensive
experience of the firm's partners in the textile industry.
Outlook: Stable
CRISIL believes that Pee Jay will continue to benefit over the
medium term from its partners' extensive experience in the textile
industry. The outlook may be revised to 'Positive' if Pee Jay's
liquidity improves, most likely because of significant increase in
its profitability and turnover, leading to better-than-expected
cash accruals, or capital infusion by its partners. Conversely,
the outlook may be revised to 'Negative' if the firm's financial
risk profile deteriorates further, most likely because of
significant increase in its working capital requirements, or
further decline in its turnover, or debt-funded capital
expenditure.
Pee Jay is a partnership form established in 1997 by Mr. Sanjiv
Gupta, Mr. Rajinder Bansal, Mr. Sanjay Gupta, and Mrs. Kamlesh
Gupta (mother of Mr. Sanjiv Gupta). The firm manufactures garments
such as T-shirts, sweaters, and jackets with its manufacturing
capacities located in Ludhiana.
For 2011-12, Firm reported a book profit of INR1.3 million on net
sales of INR426.3 million, against a book profit of INR1 million
on net sales of INR403.4 million for the previous year.
The Firm has achieved a net sale of around INR281.1 million in
2012-13.
RADHADAMODAR MULTIPURPOSE: CRISIL Rates INR40.2MM Loan at 'B'
-------------------------------------------------------------
CRISIL has assigned its 'CRISIL B/Stable' rating to the long-term
bank facility of Radhadamodar Multipurpose Coldstorage Pvt Ltd.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Term Loan 40.2 CRISIL B/Stable
The rating reflects RMCS's average financial risk profile, marked
by modest net worth and high gearing, small scale of operations,
and susceptibility to market competition and volatility in potato
prices. These rating weaknesses are partially offset by the
benefits that RMCS derives from its healthy operating margin in
the cold storage business.
Outlook: Stable
CRISIL believes that RMCS will continue to benefit from the
healthy operating margin in the cold storage business. The outlook
may be revised to 'Positive' in case of significant improvement in
its scale of operations while maintaining profitability, leading
to better-than-expected cash accruals or if there is significant
infusion of capital by the promoters, leading to improvement in
its financial risk profile. Conversely, the outlook may be revised
to 'Negative' if RMCS's liquidity deteriorates on account of
lower-than-expected cash accruals or stretch in working capital,
or it undertakes any significant debt-funded capital expenditure
programmes.
Incorporated in 2010, RMCS operates a cold storage unit (primarily
for storing potatoes) in Hooghly (West Bengal).
SILVER SPRING: CRISIL Assigns 'D' Ratings to INR240.9MM Loans
-------------------------------------------------------------
CRISIL has assigned its 'CRISIL D' rating to the long-term bank
facilities of Silver Spring Pleasure Resorts Pvt Ltd.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Overdraft Facility 60 CRISIL D
Lease Rental 92.4 CRISIL D
Discounting Loan
Long-Term Loan 88.5 CRISIL D
The rating reflects instances of delay by SSPRPL in servicing its
debt; the delays have been caused by cash flow mismatches
resulting from cyclicality in SSPRPL's operations and fund support
extended to associate entities.
SSPRPL is also vulnerable to geographical concentration in its
revenue profile, cyclicality in the hospitality segment and
intense competition in the Goa Hospitality market. However, SSPRPL
benefits from its established track record in the hospitality
segment and its moderate financial risk profile, marked by
comfortable net worth.
Established in 1994, SSPRPL operates a five star - deluxe hotel
and a casino in the Varca beach, Goa. The company was demerged
from group entity Zuri Hospitality Pvt Ltd, with effect from April
1, 2012. The day to day operations of the company are managed by
its directors - Mr. Aditya Kamani and Mr. Abishek Kamani,
supported by a professional management team.
SRI MAHALAKSHMI: CRISIL Assigns 'B+' Ratings to INR50MM Loans
-------------------------------------------------------------
CRISIL has assigned its 'CRISIL B+/Stable/CRISIL A4' rating to the
bank facilities of Sri Mahalakshmi Raw & Boiled Rice Mill.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Term Loan 10 CRISIL B+/Stable
Cash Credit 40 CRISIL B+/Stable
Short-Term Bank Facility 2.5 CRISIL A4
The rating reflects susceptibility of SMRB's operating
profitability to volatility in raw material prices and adverse
government regulations along with its small scale of operations.
These rating weaknesses are partially offset by the extensive
experience of SMRB's promoters in the rice milling industry.
Outlook: Stable
CRISIL expects SMRB to maintain its moderate business risk profile
backed by its promoter's extensive industry experience and its
established relationships with suppliers and customers. The
outlook may be revised to 'Positive' if the firm's profitability
improves leading to better accruals leading to an improvement in
its financial risk profile. Conversely, the outlook may be revised
to 'Negative' if SMRB undertakes any significant debt-funded
expansions, or if its profitability declines substantially leading
or working capital cycle lengthens leading to deterioration in its
financial risk profile.
Incorporated in 1992, SMRB is into processing of rice. SMRB is a
partnership firm, the partners being Mr P.Sudhakara Reddy, Mr
P.Sailaja. The firm has its manufacturing facility based in
Nellore, Andhra Pradesh.
For 2011-12 (refers to financial year, April 1 to March 31), SMRB
reported a profit after tax (PAT) of INR2.48 million on net sales
of INR203.5 million, against a PAT of INR1.48 million on net sales
of INR153.4 million for 2010-11.
TATA MOTORS: Jaguar Land Rover Sales Buoy FY2013 Results
--------------------------------------------------------
Moody's Investors Service says that Tata Motors Limited's (TML,
Ba3 stable) financial year results ending March 2013 once again
show the importance of Jaguar Land Rover Automotive Plc (JLR, Ba3
stable) to the overall group.
"The performance of the Indian operations was weak, as expected,
as consumers backed away from car purchases and Tata's cars
struggled to compete against international marques, while demand
for heavy and medium commercial vehicles plunged, as the economy's
growth rate slowed. However, JLR's extraordinary sales growth
record has continued with demand for the new Jaguar models surging
in FY2013," says Alan Greene, a Moody's Vice President and Senior
Credit Officer.
JLR generated almost 69.0% of group revenues in FY2013, up from
67.3% the previous year and contributed 77.1% of the reported
consolidated EBITDA of INR265.7 billion in FY2013. JLR's reported
EBITDA margin remains solid at 15.7% and it reported a profit
after tax of GBP2.5 billion (INR204.9 billion) (Indian GAAP).
Total JLR sales for FY2013 were 372,062, an increase of 18.3% over
FY2013.
"JLR's broad product mix and strong demand from emerging markets,
particularly in China, continues to be its key performance
driver," continues Greene.
"In the last few months the rate of growth of LandRover sales has
slowed but this has been somewhat mitigated by the surge in demand
for Jaguars, now running close to 80,000/year up from 55,000/year
a year ago," he adds.
Net cash at JLR increased to GBP872 million (INR71.9 billion) from
GBP795 million (INR65.6 billion) in FY2013, even as GBP2.05
billion was spent on product development and capital expenditure,
and a maiden GBP150 million dividend paid via TML Holdings Pte
Ltd. (TMHL) to the parent. In order to maintain its competitive
standing, JLR is expecting to invest GBP2.75 billion in products
and facilities in FY2014.
By contrast, the parent recorded a net loss of some INR13 billion
(approximately GBP158 million) excluding the dividends from its
subsidiaries. Reported net debt at the parent grew to INR159.8
billion in FY2013 from INR140.4 billion the previous year despite
the receipt of the dividends. Consolidated reported net debt grew
to INR249.8 billion from INR214.2 billion over the same period.
In India, TML maintained its dominance in the commercial vehicle
segment and third position in the passenger vehicle segment in
FY2013, although market share decreased to 56.1% from 58.1% in
FY2012 and to 11.8% from 14.2% in FY2012, respectively, based on
the Society of Indian Automobile Manufacturer's (SIAM)
classifications. SIAM considers small vans to be passenger
vehicle. Overall, TML reported sales of 816,495 vehicles in FY2013
(including traded sales), 11.9% fewer than in FY2012.
"The reduction in sales is credit negative and the reported EBITDA
margin for the Indian business of 4.8%, down from 8.1% in FY2012,
is grim reading," comments Greene, also lead analyst for Tata
Motors.
There was increased activity at Tata Motors Finance Limited
(TMFL), the captive finance arm of TML, despite the slide in
vehicle sales. TMFL's share of Tata vehicles bought with finance
grew from 27.6% in FY2012 to 33.1% in FY2013 while finance
disbursed grew by 6.4%. The book size now stands at INR195.13
billion compared with INR158.66 billion at FYE2012.
"However, capex and product development spending at 6.7% of
revenue in FY2013 at TML compared with the 13% of revenues spent
at JLR suggests that there is no cheap solution to the challenges
facing Tata's Indian operations," says Greene.
"Nonetheless, as long as JLR maintains its growth trajectory and
profitability, TML's rating is capable of enduring at the current
level," he continues.
"However, if JLR's performance slips or TML's losses in India make
a significant negative impact on the consolidated picture, we
would consider a potential downgrade of its rating," ends Greene.
Since the year end, TML has issued a SGD350 million (INR15.3
billion) bond through TMHL, the proceeds of which will be used to
redeem TML's holding of preference shares in TMHL. The parent
balance sheet is under pressure with debt due in the next 12
months of INR87 billion, while the interest service cover ratio
fell to 1.29x in FY2013 from 2.77x in FY2012. The bond is not
guaranteed by either the parent or JLR.
The principal methodology used in this rating was the Global
Automobile Manufacturer Industry published in June 2011.
Tata Motors Ltd, incorporated in 1945, is India's largest
manufacturer of commercial vehicles and third-largest manufacturer
of passenger vehicles. Its products include light, medium, and
heavy-duty commercial vehicles (trucks, pick-ups, and buses),
utility vehicles, and cars. TML is 34.72%-owned by the Tata Group
(as of March 2013).
WRITER LIFESTYLE: CRISIL Reaffirms 'BB' Ratings on INR1.3BB Loans
-----------------------------------------------------------------
CRISIL's ratings on the bank facilities of Writer Lifestyle Pvt
Ltd continue to reflect the strong financial support available to
the company from its parent, P N Writer & Company Pvt Ltd and the
benefits it draws from the management support and brand visibility
owing to the tie-up with the Hilton group.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Proposed Long-Term 340 CRISIL BB/Stable (Reaffirmed)
Bank Loan Facility
Term Loan 960 CRISIL BB/Stable (Reaffirmed)
The rating also factors in the lowering of in implementation
risks, as the project became partly operational in 2012-13. The
rating strengths continue to be offset by continued offtake
related risks, and the exposure of the company's performance to
cyclicality in the hotel industry and competition, particularly in
the Lonavala (Maharashtra) region, which has multiple existing and
upcoming hotels.
Outlook: Stable
CRISIL believes that WLL will maintain its stable credit profile
given the strong support from its promoter, PNW. The outlook may
be revised to 'Negative' in case of any significant delay in
successfully commissioning the residual project under
implementation or delays in timely support from the parent lead to
pressure on the company's debt servicing ability. Conversely,
higher-than-expected occupancy levels, and earlier than expected
cash break-even of operations, may drive a revision in outlook to
'Positive'.
Update
WLL's 7-star resort and spa at Shillim (near Lonavala) commenced
commercial operations from part of the property in last quarter of
2012-13 (refers to financial year, April 1-March 31), with a delay
of about 7-8 months. The all-villa resort is currently operating
about 70 villas, and the entire project is expected to become
operational by June 2013. While the project cost was about INR2200
million was higher than the previous estimates, the debt
contracted for the project remained unchanged.
CRISIL believes that implementation related risks for the project
are largely mitigated now; however, operations commenced in
December 2012-January 2013, against earlier expectations of a soft
launch around April-May 2012. Given the delays in commissioning,
CRISIL believes that shortfall in cash accruals for servicing the
debt repayments in the near term will be greater than earlier
expected; WLL's term debt repayment commences in October 2013.
CRISIL continues to believe that timely availability of funding
support from the parent will remain a key rating driver over the
medium term.
WLL has achieved occupancy and average room rates (ARRs) of about
15 per cent and INR13, 500-16,000 per night in the first 3 months
of its operations. While CRISIL believes that the resort's
occupancy rates will increase substantially over the medium term,
increase in ARR and occupancy rate is expected to be only gradual
over the near term. Improved visibility on demand offtake will
remain key rating sensitivity factor in the near term, while cash
break even will be a key rating driver over the medium term.
Further, WLL's villas project, when successfully launched, also
may generate surplus cash flows, which will improve the company's
liquidity.
WLL, belonging to the Writer Group, is a wholly owned subsidiary
of PNW. WLL is an SPV floated to set up a luxury 7-star category
Resort and Spa at Shillim (100 km drive from Mumbai and 30 km
drive from Pune). The company is also planning to construct 20
luxury villas in Shillim; the villas project is expected to be
launched in the next few months.
PNW operates in two core segments: relocation and record
management businesses.
YARLAGADDA AGROS: CRISIL Rates INR50MM Cash Credit at 'B'
---------------------------------------------------------
CRISIL has assigned its 'CRISIL B/Stable' rating to the long-term
bank facility of Yarlagadda Agros Pvt Ltd.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 50.00 CRISIL B/Stable
The rating reflects YAPL's modest scale of operations in a
fragmented tobacco industry and exposure to risks related to
unfavorable government regulations; the rating also factors in the
firm's below-average financial risk profile. These rating
weaknesses are partially offset by the extensive industry
experience of YAPL's promoter in tobacco industry.
Outlook: Stable
CRISIL expects YAPL to maintain its stable business risk profile
over the medium term, backed by its promoter's extensive industry
experience and established relationships with its customers. The
outlook may be revised to 'Positive' if the company significantly
expands its scale of operations along with an improvement in
operating profitability, resulting in higher than expected cash
accruals leading to improvement in financial risk profile and also
improves its liquidity position by effectively managing its
working capital needs. Conversely, the outlook may be revised to
'Negative' if the company's scale of operations reduces
significantly thus impacting the cash accruals adversely, or a
deterioration in its liquidity and financial risk profiles on
account of higher than expected working capital requirements or
larger than expected debt funded capital expenditure.
Incorporated in 1996, YAPL is based out of the Guntur district of
Andhra Pradesh. The company is engaged in the trading of four
varieties of tobacco Flue Cured Virginia (FCV) tobacco, Viriginia
Air Cured (VAC), Burley tobacco (BT) and Sun cured Natu tobacco
(NATU). The company is actively managed by Mr. Y. A. Chowdhary.
YETURU BIO-TECH: CRISIL Assigns 'D' Ratings to INR92MM Loans
------------------------------------------------------------
CRISIL has assigned its 'CRISIL D' rating to the bank facilities
of Yeturu Bio-Tech Limited. The rating reflects the instances of
delay by YTBL in servicing its debt obligations. The delays have
been on account of stretched liquidity.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Overdraft Facility 25.00 CRISIL D
Term Loan 67.00 CRISIL D
YTBL also has weak financial profile and the operations are
working capital intensive. These rating weaknesses are partially
offset by the extensive experience of its promoter.
Established as a partnership firm in 1996 as Yeturu gardens, it
was subsequently incorporated as a private limited company in
2003-04 as Yeturu Biotech Limited. The company is engaged in the
business of cultivation of Aloe Vera plants and manufacturing and
marketing of Aloe based end products. Promoted by Mr. Yeturu
Ramchandra Reddy, the operations of the company are being actively
managed by Mr. Sirish Reddy.
=================
I N D O N E S I A
=================
PROFESIONAL TELEKOMUNIKASI: Fitch Affirms 'BB' Long-Term FC IDR
---------------------------------------------------------------
Fitch Ratings has affirmed Indonesia's PT Profesional
Telekomunikasi Indonesia's (Protelindo) Long-Term Foreign-Currency
Issuer Default Rating (IDR) at 'BB' and its National Long-Term
Rating at 'AA-(idn)'. The Outlook is Stable on both ratings.
Key Rating Drivers
Manageable Financial Leverage: Protelindo's funds flow from
operations (FFO)-adjusted net leverage rose to 3.9x at end-March
2013 (2012: 3.4x) due to an acquisition investment of IDR992bn
(USD104m). "We expect Protelindo's leverage to remain below 4.0x
in 2013 as internally generated cash should be sufficient to fund
capex. The agency also derives comfort from management's
commitment to keep net debt/quarterly annualised EBITDA around
3.0x-3.5x," Fitch says.
Solid Business Model: Protelindo draws stable and predictable cash
flows from long-term non-cancellable contracts (10-12 years),
which provide for in-built annual price increases linked to the
inflation rate. The company receives more than half of its total
revenue annually in advance and had about USD2.7bn (IDR25.6trn) of
contracted revenue through 2027 at end-March 2013. The rating also
factors in strong EBITDA margins (2012: 83%) and a favorable
regulatory regime, which encourages telcos to share towers, rather
than building new single-tenancy towers.
Acquisitive Nature: Fitch believes that Protelindo's leverage is
unlikely to fall below 3.0x on a sustained basis in the short term
as acquisition is a natural growth strategy for tower companies.
During 2012, Protelindo bought 152 towers from PT Central
Investindo, 261 towers from Netherlands-based Royal KPN N.V (KPN,
BBB-/Stable) and 503 towers from PT Hutchison CP Telecommunication
(HCPT, a subsidiary of Hutchison Whampoa Limited (HWL, A-
/Stable)). Fitch's forecast includes an annual acquisition budget
of IDR1trn (USD105m).
Tenancy Mix Concern Remains: Protelindo improved its tenancy mix
in 2012 to 35:65 in favor of investment-graded telcos from 30:70
in 2011. "Our key concern for Protelindo's rating is its exposure
to small, unprofitable Indonesian telcos. Particularly, PT Bakrie
Telecom (BTel, CC) and PT Smartfren (CC(idn)), which together
contributed about 15% of Protelindo's 1Q13 revenue, face liquidity
problems as they struggle to expand their market share and
generate sufficient cash," Fitch says.
However, Fitch derives comfort from the fact that telcos
frequently view tower lease obligations as senior to debt service
given the need to continue to provide services to subscribers.
Rating Sensitivities
Negative: Future developments that could individually or
collectively lead to negative rating actions include
-- A debt-funded acquisition of another tower portfolio or lease
defaults by weaker telcos leading to deterioration in FFO-
adjusted net leverage to over 4.0x on a sustained basis.
-- Weakening of HWL's commitment to HCPT leading to HCPT not
honouring its contractual commitments to Protelindo would also
put downward pressure on the ratings.
A positive rating action is not expected in the short term; the
company is unlikely to deleverage significantly as it invests to
maintain growth.
PROFESIONAL TELEKOMUNIKASI: Refinancing No Impact on Ratings
------------------------------------------------------------
Moody's Investors Service notes that completion of Profesional
Telekomunikasi Indonesia (Protelindo's) refinancing exercise is
credit positive, although it has no immediate impact on the
company's current Ba2 rating and stable outlook.
In December 2012, Protelindo had refinanced the majority of its
debt with a $575 million and EUR40 million senior unsecured bridge
facility, which was due for repayment in mid- June 2013. This led
to transient liquidity pressures, and could have resulted in
downward rating pressure if there had been material slippages in
the timeline for refinancing the bridge loan (Refer Moody's New
Issuer Report for Protelindo dated March 8, 2013).
"However, in line with our expectations, Protelindo has completed
the refinancing ahead of the maturity of its bridge loan, further
demonstrating the company's strong access to bank financing from
international and domestic banks," says Nidhi Dhruv, a Moody's
Analyst and also lead analyst for Protelindo.
On May 20, 2013, Protelindo signed a $350 million term loan, EUR40
million term loan and a $125 million revolving credit facility --
all with final bullet maturity in May 2018. The transaction was
initially led by DBS Bank Ltd., ING Bank N.V. and Standard
Chartered Bank, and the final syndication comprised 33 banks.
On May 28, 2013, Protelindo drew down the entire facility amount.
The majority of the proceeds ($463 million and EUR40 million) were
used to repay the outstanding bridge facility, and the remaining
$12 million of the revolving credit facility will be used for
general corporate purposes.
In December 2012, Protelindo had repaid $112 million of the bridge
facility through an IDR1.1 trillion amortizing loan from Bank
Negara Indonesia.
"The refinancing exercise has significantly strengthened
Protelindo's liquidity profile, and has lengthened the company's
debt maturity profile such that over 75% of its debt falls due
only in 2018 and beyond," adds Dhruv.
As of March 2013, Protelindo's cash sources comprised cash on hand
of approximately IDR942.2 billion with Moody's expectation of cash
flow from operations of around IDR1.0-1.2 trillion over the next
12 months, which would be sufficient to cover debt maturities of
IDR502 million and capex of approximately IDR1.0-1.2 trillion.
The principal methodology used in this rating was the Global
Communications Infrastructure Rating Methodology published in June
2011.
Founded in 2003, Protelindo is one of Indonesia's two leading
independent tower operators. As of March 2013, it leased space on
its 8,992 communication sites to cellular telecommunications
operators under 16,195 long-term tenancy contracts. Protelindo is
wholly owned by Sarana Menara Nusantara, an investment holding
company with the sole purpose of owing shares in Protelindo.
=========
J A P A N
=========
ARCH FINANCE 2007-1: Moody's Downgrades Dual Currency Loan to Ba2
-----------------------------------------------------------------
Moody's Japan K.K. downgraded to Ba2 from Ba1 its rating on the
Arch Finance Limited Series 2007-1 Reverse Dual Currency Loan.
The affected rating is as follows:
Deal Name: Arch Finance Limited Series 2007-1 Reverse Dual
Currency Loan
JPY12,363,538,000 Series 2007-1 Reverse Dual Currency Loan,
downgraded to Ba2; previously on December19, 2012, Ba1 placed
under review for downgrade.
Ratings Rationale:
The rating downgrade is the result of the rating downgrade of the
collateral asset.
The rating of the transaction mainly reflects the credit quality
of the collateral asset, the credit quality of the swap
counterparty, and the strength of the transaction structure.
The primary source of assumption uncertainty is the macroeconomic
environment, which could negatively affect the credit qualities
for the collateral and swap counterparty.
If the ratings of the collateral asset and the swap counterparty
change, the rating of the loan can also change.
The principal methodology used in this rating was "Moody's
Approach to Rating Repackaged Securities" published in April 2010.
Moody's did not conduct additional cash flow analyses or stress
scenarios because the rating on this transaction is derived from
the ratings of the collateral asset and the swap counterparty.
L-JAC FIVE: S&P Lowers Rating on Class B Certificate to 'D'
-----------------------------------------------------------
Standard & Poor's Ratings Services said that it has lowered to 'D
(sf)' from 'CCC (sf)' its rating on the class B trust certificate
issued under the L-JAC Five Trust Beneficial Interest (L-JAC Five)
transaction. The class A and D-3 trust certificates have already
fully repaid. S&P has already lowered to 'D (sf)' its ratings on
12 tranches of trust certificates issued under this transaction:
classes C, D-1 to J-1, and D-2 to G-2.
Although the sale of the real estate properties backing two loans-
-the transaction's remaining underlying assets--has been
completed, collection proceeds were less than the total
outstanding principal on these loans. This in turn led to
impairment of part of the principal on class B, and S&P
downgraded this class accordingly.
L-JAC Five is a multiborrower commercial mortgage-backed
securities (CMBS) transaction that Lehman Brothers Japan Inc.
arranged. Twenty loans originally secured the trust certificates,
and 81 real estate properties and real estate beneficial interests
originally backed the loans. Premier Asset Management Co. acts as
the servicer for this transaction.
STANDARD & POOR'S 17G-7 DISCLOSURE REPORT
SEC Rule 17g-7 requires an NRSRO, for any report accompanying a
credit rating relating to an asset-backed security as defined in
the Rule, to include a description of the representations,
warranties and enforcement mechanisms available to investors and a
description of how they differ from the representations,
warranties and enforcement mechanisms in issuances of similar
securities. The Rule applies to in-scope securities initially
rated (including preliminary ratings) on or after Sept. 26, 2011.
If applicable, the Standard & Poor's 17g-7 Disclosure Report
included in this credit rating report is available at:
http://standardandpoorsdisclosure-17g7.com
RATING LOWERED
L-JAC Five Trust Beneficial Interest
JPY63.63 billion floating-rate trust certificates due August 2015
Class To From Initial issue amount
B D (sf) CCC (sf) JPY7.20 bil.
PANASONIC CORP: Plans to Slash 5,000 Jobs Over Three Years
----------------------------------------------------------
AFP reports that Panasonic Corp said it was aiming to cut about
5,000 jobs over three years in its automotive and industrial
systems unit, following an eye-watering annual loss.
A company spokeswoman said the division, which makes everything
from memory chips to car navigation systems, would reduce its
existing workforce of about 111,000 people by March 2016, AFP
relates.
According to the news agency, the job cuts came less than a month
after Panasonic, which has cut about 20% of its total workforce in
recent years, booked a JPY754.25 billion net loss over the year to
March.
AFP notes that Panasonic, like key domestic rivals Sony and Sharp,
has suffered in its television business where lower-costs foreign
rivals proved tough competition, while its debt was inflated by
the purchase of smaller rival Sanyo.
Panasonic's job cuts are part of a wider industry overhaul aimed
rescuing Japan's struggling electronics giants which have also
suffered from strategic mistakes that left their finances in
ruins, the report says.
The company had a total of 293,742 employees as of March 31, the
report adds.
Panasonic Corporation, formerly Matsushita Electric Industrial
Co., Ltd. -- http://www.panasonic.co.jp/-- is engaged in the
production and sales of electronic and electric products in an
array of business areas. It offers products, systems and
components for consumer, business and industrial use. Most of
the company's products are marketed under the Panasonic brand
name worldwide, along with other product, or region, specific
brand names, including National primarily for home appliances and
household electric equipment sold in Japan, and Technics for
certain high-fidelity products.
In February, Fitch Ratings put Panasonic Corporation's Long-Term
Foreign- and Local-Currency Issuer Default Ratings (IDR) and local
currency senior unsecured ratings at 'BB', respectively. The
Outlook on the Long-Term IDRs is Negative. Simultaneously,
Panasonic's Short-Term Foreign- and Local-Currency IDRs have been
affirmed at 'B'.
Fitch said the speculative-grade ratings reflect Panasonic's weak
competitiveness in its core businesses, particularly in TVs and
panels, as well as weak cash generation from operations (CFO).
The Negative Outlook reflects the agency's view that the
company's financial profile is not likely to show a material
improvement in the short- to medium-term. Fitch acknowledges that
the company is heading in the right direction with its
restructuring efforts which could potentially lead to margin
recovery over the long-term. However, the company's turnaround
programme remains exposed to execution risk.
====================
N E W Z E A L A N D
====================
GENESIS ENERGY: S&P Affirms BB- Rating on NZ$275MM Capital Bonds
----------------------------------------------------------------
Standard & Poor's Ratings Services said that it has placed the
issue rating on the NZ$275 million capital bonds due 2041 issued
by Genesis Power Ltd. on CreditWatch with positive implications.
At the same time the BB-' issue rating on the capital bonds was
affirmed.
On May 30 Genesis Power Ltd., trading as Genesis Energy, announced
its intention to amend the terms of its NZ$275 million capital
bonds as a result of a recent change of criteria, which meant the
capital bonds were no longer eligible for High equity content.
Driven by the recent change in criteria for how equity content is
assessed, Genesis Energy is attempting to amend the terms of the
capital bonds with a view to removing the existing provisions that
could mandatorily defer interest, replacing those provisions with
an ability to defer interest at the company's option. This
amendment has been driven by a recent change of criteria that
meant that the capital bonds were no longer eligible for the High
equity content assessment they received when issued.
The placement on CreditWatch reflects the notching differential
between instruments with mandatory deferral mechanisms (typically
at least two notches) compared to optional deferral (one notch)
and our view that the amendments are likely to be approved by
investors.
"To resolve the CreditWatch, we would need to see confirmation
that investors have approved the amendments to the terms of the
capital bonds and that those amendments have become effective,"
said credit analyst Thomas Jacquot. "Upon confirmation, we would
expect to raise the issue rating on the capital bonds to 'BB+'
from the current 'BB-'".
If the amendments do not become effective, the issue rating would
remain unchanged.
S&P expects to resolve the CreditWatch before the end of July
2013.
LOMBARD FINANCE: CA Rejects Directors' Conviction Appeal
--------------------------------------------------------
Stuff.co.nz reports that the Court of Appeal has rejected an
appeal against conviction by four former directors of Lombard
Finance, which collapsed in 2008, and they now face increased
penalties.
The directors were Sir Doug Graham and Bill Jeffries who are both
former justice ministers, Lawrence Bryant and chief executive
Michael Reeves, the report discloses.
They were convicted in the High Court in February last year on
four counts of making untrue statements in a Lombard prospectus
issued just before Christmas in 2007, according to Stuff.co.nz.
Stuff.co.nz reports that the Court of Appeal said that the
sentences imposed by the High Court did not reflect the "gravity
of the offending", the number of investors affected and the
substantial amounts of money invested -- more than NZ$10 million
invested in reliance on the amended prospectus.
Stuff.co.nz relates that the Court of Appeal said the starting
points of imprisonment for two and a half years should have been
adopted before applying any discounts for "mitigating features".
But because the Solicitor-General did not seek prison, the proper
sentence was a combination of home detention and community work,
the report relates.
According to the report, the Court of Appeal has asked for further
reports on the addresses of the directors "for home detention
purposes" and would issue a final judgment on the sentences to be
imposed, as soon as the reports are made.
At a four-day hearing in the Court of Appeal earlier this year,
the report recalls, the directors said they should not have been
convicted, but the Crown argued the convictions should stay and
the sentences should be increased.
Messrs. Graham and Bryant was sentenced to 300 hours' community
work and to pay NZ$100,000 reparation. Messrs. Reeves and
Jeffries were sentenced to 400 hours' community work.
The Court of Appeal on May 31 upheld the findings of the High
Court that the amended prospectus was untrue, by leaving out
reference to the sharp deterioration in the company's cash
position, "the serious downward trend" in the cash position and
the serious delays in the recovery of loan repayments, Stuff.co.nz
adds.
About Lombard Finance
Lombard Finance & Investments Limited is a wholly owned
subsidiary of Lombard Group, a diversified company specializing
in the financial services sector offering a number of lending
options and providing investment opportunities for its
shareholders and investors.
Lombard Finance was placed into receivership on April 10, 2008,
by its trustee, Perpetual Trust Limited. PricewaterhouseCoopers
partners John Fisk and John Waller have been appointed receivers
of the company. The receivership also applies to three other
subsidiaries of Lombard Group, being Lombard Asset Finance
Limited, Lombard Property Holdings Limited and Lombard Asset
Finance No 2 Limited. The receivership does not impact on
Lombard Group Limited.
NEW TALISMAN: Annual Loss Widens to NZ$914,265
----------------------------------------------
BusinessDesk reports that New Talisman Gold Mines, the 10th worst
performing stock on the New Zealand exchange in the past 12
months, said its loss widened last year as it raised less money
from shareholders for investment.
Mining prospector New Talisman, previously known as Heritage Gold
NZ, said its loss widened to $914,265 in the 12 months ended March
31, from $766,259 a year earlier. Revenue dropped 67 percent to
$11,791.
"As the company has no significant income streams, it raises funds
from shareholders and new investors for its activities, this has
led to greater reported losses," Auckland-based New Talisman says
in a statement.
The prospector has split into two units and changed its name to
better focus the core company on developing its Talisman gold mine
project in New Zealand's Hauraki district.
New Talisman Gold Mines Limited, formerly Heritage Gold NZ Limited
-- http://www.newtalismangoldmines.co.nz/-- is engaged in
minerals exploration. The Company is developing the historic
Talisman Mine in the Hauraki Gold Field.
====================
S O U T H K O R E A
====================
STX GROUP: Banks May Supply More Liquidity to Shipbuilding Unit
---------------------------------------------------------------
Yonhap News reports that creditor banks of troubled STX Group have
almost reached an agreement to provide additional liquidity to the
group's shipbuilding unit in a bid to help it stay afloat,
industry sources said Friday.
According to the report, sources said creditor banks of STX
Offshore & Shipbuilding Co. are moving to offer KRW300 billion
(US$266.4 million) to the company, smaller than the KRW400 billion
requested by the shipbuilder.
Previously, the shipbuilder was injected with KRW600 billion in
liquidity from creditors.
Creditor banks have supplied KRW1.09 trillion to STX Group's
holding company and three troubled affiliates in return for their
voluntary debt-relief and overhaul efforts.
Industry watchers estimated that around KRW2 trillion in
additional funds may be needed to help STX Corp. The sheer volume
of liquidity injection needed for STX Group is seen as staggering,
given that local banks' combined earnings amounted to KRW1.8
trillion in the first quarter, experts say.
STX Group, a South Korean shipbuilding conglomerate, has seen its
major affiliates struggling from liquidity shortages as they have
been suffering from mounting debt due to the downturn in the
shipbuilding and shipping sectors, Yonhap News disclosed.
STX Corp., the group's holding company, and its two affiliates
have asked main creditor Korea Development Bank to inject
liquidity in return for a voluntary debt relief process to salvage
the firm from insolvency.
STX Corp. has 11 affiliates including STX Pan Ocean and STX
Offshore & Shipbuilding under its wing.
IT service provider ForceTec, in which group chief Kang Duk-soo
holds 69.4 percent stake, has a 23.1 percent stake in STX Corp.
Mr. Kang also holds a 25 percent interest in STX Construction,
which applied for a court receivership on April 26, Yonhap added.
Yonhap, citing industry data, notes that the group has debts worth
KRW1 trillion (US$897.9 million) that come due within this year,
of which KRW500 billion comes to maturity this month.
*********
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
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latest balance sheets publicly available a day prior to
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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-
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Copyright 2013. All rights reserved. ISSN: 1520-9482.
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