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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, November 4, 2013, Vol. 16, No. 218
Headlines
A U S T R A L I A
HARRISON GROUP: Receivers Get Extension to Convene Meeting
MISSION NEWENERGY: Files Rebuttal in Arbitration Proceedings
NATIONAL ENGINEERING: Goes Into Liquidation; Cuts 41 Jobs
NINE ENTERTAINMENT: Seeks to Raise Up to $570 Million in IPO
RIVERSIDE ESTATE: Ferrier Hodgson Appointed as Receivers
WAGAMAMA: Goes Into Voluntary Administration
I N D I A
3S INFRASTRUCTURE: CRISIL Reaffirms 'B' Rating on INR135MM Loan
A. S. IRON: CRISIL Assigns 'BB' Ratings to INR200MM Loans
ALOM EXTRUSIONS: CRISIL Suspends BB+ Ratings on INR288.6MM Loans
ARYA GREEN: CRISIL Assigns 'B+' Ratings to INR100MM Loans
BOUTIQUE HOTELS: CRISIL Reaffirms 'BB' Ratings on INR990MM Loans
FREEZE EXIM: CRISIL Assigns 'B' Ratings to INR11.9MM Loans
FUTURISTIC EDUCATIONAL: CRISIL Puts 'B+' Ratings on INR95MM Loans
GEE EMM: CRISIL Assigns 'B' Ratings to INR80MM Loans
GREEN VALLEY: CRISIL Lowers Ratings on INR920MM Loans to 'BB'
JINDAL COTEX: CARE Cuts Ratings on INR162.26cr Loans to 'D'
JINDAL MEDICOT: CARE Cuts Ratings on INR82cr Loans to 'D'
JINDAL SPECIALTY: CARE Lowers Ratings on INR145cr Loans to 'D'
KAASHVI INDUSTRIES: CRISIL Suspends BB Rating on INR235.2MM Loans
KORES (INDIA): CRISIL Reaffirms 'BB+' Rating on INR1.21BB Loans
KSM SPINNING: CARE Upgrades Rating on INR115.84cr Loans to 'BB'
LAKSHMI TRANSFORMERS: CRISIL Cuts Ratings on INR30MM Loans to 'B'
MJR STEELS: CRISIL Reaffirms BB+ Ratings on INR119.6MM Loans
MAHALAXMI TMT: CARE Revises Ratings on INR717.17cr Loans to 'B'
MAITRI EDUCATIONAL: CRISIL Assigns 'D' Ratings to INR140MM Loans
MICO PLAST: CARE Assigns 'BB-' Rating to INR17.49cr Loans
MOLISATI VINIMAY: CRISIL Reaffirms B+ Rating on INR108.5MM Loan
NAMAHA ESTATES: CRISIL Assigns 'B+' Ratings to INR200MM Loans
NAMCO COMMODITIES: CARE Cuts Ratings on INR105cr Loans to 'D'
NAMCO CORP: CARE Lowers Ratings on INR444.11cr Loans to 'D'
NAMCO INDUSTRIES: CARE Lowers Ratings on INR385.58cr Loans to 'D'
NOBLE MOULDS: CRISIL Lowers Ratings on INR135MM Loans to 'D'
NORTHERN SKY: CRISIL Upgrades Ratings on INR250MM Loans to 'B+'
OM PRAKASH: CRISIL Reaffirms 'B+' Ratings on INR130MM Loans
PURBANCHAL LUMBERS: CRISIL Reaffirms 'B+' Rating on INR30MM Loans
PV SONS: CRISIL Suspends 'BB' Ratings on INR125MM Loans
QVC EXPORTS: CRISIL Reaffirms 'BB-' Ratings on INR30MM Loans
RAGHUVAR (INDIA): CRISIL Puts 'B+' Ratings on INR378.5MM Loans
RAKSAN TRANSFORMERS: CRISIL Rates INR70MM Cash Credit at 'B+'
RANJEET AUTOMOBILES: CRISIL Suspends BB Ratings on INR120MM Loans
RATNADEEP METAL: CRISIL Reaffirms 'B' Ratings on INR470MM Loans
REPUBLIC AUTO: CARE Rates INR9.25cr LT Bank Loans at 'B+'
S T WOVEN: CARE Assigns 'B+' Rating to INR9.35cr LT Bank Loans
SAHIBZADA TIMBER: CRISIL Assigns 'B' Rating to INR150MM Loan
SAHIL AUTOMOBILES: CARE Rates INR9.8cr LT Bank Loans at 'BB'
SAKET ENGINEERS: CRISIL Ups Ratings on INR1.07BB Loans to 'B-'
SAMOSARAN SYNTEX: CRISIL Reaffirms BB+ Rating on INR250MM Loan
SAMOSARAN YARNS: CRISIL Reaffirms 'BB+' Ratings on INR801MM Loans
SHRIGANESH TEXFAB: CARE Rates INR18.05cr LT Bank Loans at 'B'
SHREE VENKATESH: CRISIL Suspends BB+ Rating on INR375MM Loan
SONAL ADHESIVES: CRISIL Cuts Rating on INR110MM Loan to 'BB-'
SPANISO STUDIO: CRISIL Reaffirms BB- Ratings on INR40MM Loans
STANDARD AUTO: CARE Rates INR24.52cr LT Bank Loans at 'BB'
SUMATEX LIMITED: CRISIL Suspends BB+ Ratings on INR125.5MM Loans
SUNSHINE FASTENERS: CRISIL Reaffirms BB Rating on INR187.3M Loans
TRANSWORLD FURTICHEM: CRISIL Ups Ratings on INR550MM Loans to BB
UMALAXMI ORGANICS: CARE Reaffirms BB Rating on INR7.14cr Loans
VEDANTA CREATIONS: CRISIL Assigns 'BB+' Rating to INR50MM Loan
VIKRAM STRUCTURES: CRISIL Assigns 'D' Ratings to INR250MM Loans
WESTERN SUITINGS: CARE Rates INR5.94cr LT Bank Loans at 'BB-'
YASHO INDUSTRIES: CRISIL Suspends 'BB+' Ratings on INR405MM Loans
I N D O N E S I A
METROPOLIS PROPERTINDO: S&P Assigns 'B+' CCR; Outlook Stable
N E W Z E A L A N D
TACHIKAWA FOREST: NZ$5 Million Could Rescue Sawmill, MP Says
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=================
A U S T R A L I A
=================
HARRISON GROUP: Receivers Get Extension to Convene Meeting
----------------------------------------------------------
Nick O'Donoghue at Pharmacy News reports that an extension to the
time the receivers of the Harrison's Group have to convene the
second meeting of creditors will ensure employees receive their
entitlements.
Pharmacy News relates the Federal Court of Australia has granted
the receivers an extra six months before convening a second
meeting of creditors for the nine companies which formed the
Harrison Group of Companies.
According to the report, court documents revealed that seven of
the businesses in the Harrisons' Group had been sold with seven
more subject to pending sale, due to be completed in November or
December, and an additional five businesses still the subject of
negotiations, but sales contracts have not yet been entered into.
As reported in the Troubled Company Reporter-Asia Pacific on
April 5, 2013, Pharmacy News said Harrison Group entered
receivership after 54 years of trading. Deliotte partners
David Lombe and Jason Tracy have been appointed as receivers and
managers of the group, which will continue to trade as normal,
business website SmartCompany.com.au reported.
The Harrison Group has pharmacies in New South Wales, Queensland,
South Australia and Northern Territory, a number of medical
centres and a head office in Sydney.
MISSION NEWENERGY: Files Rebuttal in Arbitration Proceedings
------------------------------------------------------------
Mission NewEnergy Limited announced that formal hearings under the
arbitration proceedings will now commence, after the parties
failed to come to an amicable settlement during mediation which
was undertaken under the auspices of the 3 member arbitration
panel constituted under Indonesian Arbitration Board (BANI) rules.
As announced on 15 May 2013, Mission's 85 percent owned
subsidiary, Oleovest Pte Ltd (Oleovest) as the Claimant,
officially registered its request for arbitration with the
Indonesian Arbitration Board (BANI) to seek compensation from the
Indonesian government owned palm plantation company, PT Nusantara
III (PTPN111) for breach of its material and non material
obligations under its joint venture agreement (JVA) with Oleovest.
Under the terms of the joint venture agreement the defaulting
party being PTPN111, is obligated to acquire Oleovest's shares at
the greater of either the market value or cost of investment, such
value to be determined by an internationally reputed appraiser to
be appointed by the Joint venture company and agreed to by the
parties. To date, Oleovest's investment in the joint venture
project is approximately US$4 million. Having failed to reach an
agreement during the mediation under the BANI arbitration rules on
the choice of appraiser, the arbitration panel has ordered for the
hearings to commence with the Claimant formally submitting its
rebuttal.
Oleovest, in its rebuttal, is seeking compensation of
approximately US$85 million, excluding interest. The next hearing
is expected to be sometime in mid December 2013, after the
Respondent submits its reply.
The Company can provide no assurances as to the amount or the
timing of when or if an award from the Indonesian arbitration
panel would be forthcoming.
About Mission NewEnergy
Based in Subiaco, Western Australia, Mission NewEnergy Limited is
a producer of biodiesel that integrates sustainable biodiesel
feedstock cultivation, biodiesel production and wholesale
biodiesel distribution focused on the government mandated markets
of the United States and Europe.
The Company is not operating its biodiesel refining segment. The
refineries are being held in care and maintenance either awaiting
a return to positive operating conditions or the sale of assets.
The Company has materially diminished its Jatropha contract
farming operation and the company is now focused on divesting the
remaining Indian assets. The Company intends to cease all Indian
operations.
Grant Thornton Audit Pty Ltd, in Perth, Australia, expressed
substantial doubt about the Company's ability to continue as a
going concern. The independent auditors noted that the Company
incurred operating cash outflows of AUD4.9 million during the year
ended June 30, 2012, and, as of that date, the consolidated
entity's total liabilities exceeded its total assets by
AUD24.4 million.
As of June 30, 2013, the Group had AUD7.53 million in total
assets, AUD32.60 million in total liabilities, and a
AUD25.07 million total deficiency.
NATIONAL ENGINEERING: Goes Into Liquidation; Cuts 41 Jobs
---------------------------------------------------------
The Young Witness reports that National Engineering employees were
told to clean out their lockers on October 28 because the company
had gone into liquidation.
"What am I going to do? It was a complete shock to everyone, not
just to me," a now former National Engineering employee told The
Young Witness.
The Young Witness relates that this worker and 40 others were told
they were no longer employed after hearing the company -- one of
Young's biggest and longest serving -- had gone into liquidation.
This is not the first time the 120-year-old steel fabrication
company has faced an uncertain future, the report says.
According to the report, National Engineering was put on the
market in November 2011 when former owners EVZ Limited said "it no
longer fitted with their investment portfolio".
EVZ had spent the previous three years trying to reinvigorate the
business during poor economic times, says The Young Witness.
The report notes that the sale loomed for five months until
Canberra businessman and former National Engineering contractor
Michael Deeble took over the reins on March 27 last year with
support from the NSW Government and Young Shire Council.
Employees were told on October 28 Mr. Deeble had declared
bankruptcy, the report notes.
According to The Young Witness, RSM Bird Cameron Partners in
Canberra were appointed voluntary administrators and are now
overseeing the liquidation.
The report relates that administrator Frank Lopilato --
frank.lopilato@rsmi.com.au -- said the company's financial
position forced them to cease trading and terminate staff.
Mr. Lopilato said they are still trying to sort through paperwork
to determine when the company started having financial trouble,
the report adds.
NINE ENTERTAINMENT: Seeks to Raise Up to $570 Million in IPO
-------------------------------------------------------------
Jackie Range and Thuy Ong at Reuters report that Nine
Entertainment Co Pty Ltd is seeking to raise as much as
$570 million in an initial public offering, a person familiar with
the process said, a move that will help the troubled TV network
pay down debt.
The IPO of one of Australia's best known media firms is expected
to be the biggest by an Australian company this year and comes at
a busy time for new listings Down Under, Reuters says.
The up to AUD600 million offering will have an indicative price
range of AUD2.05 to AUD2.35 a share, the person said, declining to
be identified as the process is confidential, Reuters relates.
That would give the company, which plans to list on Dec. 6, a
market capitalisation of AUD1.9 billion to AUD2.2 billion, the
person, as cited by Reuters, added.
According to the news agency, Nine avoided receivership with U.S.
hedge funds Oaktree Capital Group and Apollo Global Management
taking control in a more than $3 billion debt for equity swap.
Contract for difference provider IG is offering a "grey market"
which lets its clients trade derivatives ahead of Nine's listing
based on where they think the shares will end up after the first
day of trading, Reuters says.
"The demand is there . . . It then gets back to what will the
valuation be, most are holding it at 8 to 9 times earnings,"
Reuters quotes Evan Lucas, IG's market strategist as saying. The
valuation was similar to rival Seven West Media Ltd, he added.
Reuters relates that Mr. Lucas said a key uncertainty for Nine is
its level of debt.
"Most of these TV companies have huge amount of debt and that's
always going to be an issue in a situation where you're relying on
advertising dollars which is a very demanding and very fluctuating
market," Mr. Lucas, as cited by Reuters, said.
Oaktree Capital, which owns some 28 percent of Nine is expected to
offload between 20 percent and 40 percent of its stake, the person
familiar with the matter told Reuters. Apollo, which owns a
reported 26 percent, is expected to hang on to all of its holding,
says Reuters.
The report says the IPO prospectus will be lodged [to]day, Nov. 4.
The debt-for-equity swap, approved by creditors in January this
year, saw CVC Capital Partners Ltd's AUD1.8 billion equity
investment almost wiped out, notes Reuters.
Nine's financial woes took a turn for the worse when the global
financial crisis hit as advertising revenues collapsed across the
media sector, slashing profits at TV networks, says the report.
About Nine Entertainment
Nine Entertainment Co., formerly known as PBL Media, --
http://www.nineentertainment.com.au/--is one of the largest
private-equity owned companies in Australia, bought by Asia
Pacific Ltd at the height of the buyout boom in 2006. CVC spent
about AUD5.3 billion in debt and equity in acquiring the company
from media baron James Packer. In addition to Nine, one of
Australia's three free-to-air television networks, the group also
owns magazine publisher ACP, the online media company nineMSN,
Acer Arena and ticketing agency Ticketek.
As reported in the Troubled Company Reporter-Asia Pacific on
Oct. 7, 2013, Moody's Investors Service assigned a definitive Ba2
senior secured rating to a US$ Term Loan Facility (equivalent to
around AUD198.7 million) entered into by Nine Entertainment Group
Pty Ltd and Nine Entertainment (Delaware) Corporation, 100% owned
and guaranteed subsidiaries of Nine Entertainment Co Holdings
Limited ("NEC"). The facility was originally assigned a
provisional (P)Ba2 rating on September 5, 2013; the assignment of
the definitive Ba2 rating follows review of the final Term Loans
documentation. The loan rated is a US$185 million Senior Secured
Facility due February 2020. The loan is guaranteed by NEC and
certain of its subsidiaries. The loan is secured on a first-
priority basis by substantially all the material-owned assets of
NEC and guarantors.
RIVERSIDE ESTATE: Ferrier Hodgson Appointed as Receivers
--------------------------------------------------------
Kerrie Lush at ABC Riverland reports that Riverside Estate was
placed under the management of Ferrier Hodgson on October 22 and
will soon be advertised for sale.
"The financiers have been working with the directors for a number
of years trying to get a resolution and a way forward for the
village but it seems to have stalled so we were appointed
receivers on October 29," ABC Riverland quotes Ferrier Hodgson's
Martin Lewis -- martin.lewis@fh.com.au -- as saying.
"Our objective basically is to locate an industry operator that
may be able to come in to the development, essentially take it
over and unlock the opportunities for the site going forward.
"What that means is in terms of the residents it will be business
as usual, the management company will still be there -- not
related to the directors.
"The residents won't really notice any difference whatsoever and
the rights that they currently enjoy, at law under the Retirement
Villages Act will still be there and still maintained."
Riverside Estate is a retirement village based in Renmark.
WAGAMAMA: Goes Into Voluntary Administration
--------------------------------------------
goodfood.com.au reports that Japanese restaurant chain Wagamama
has gone into voluntary administration, and its Southbank venue in
Melbourne has been shut down.
Administrator KPMG took control of the business, according to
goodfood.com.au.
The report relates that staff at the restaurant chain received
news that the company behind Wagamama had gone into
administration. The report notes that KPMG partner and
administrator Ian Hall -- hall@kpmg.com.au -- said the Southbank
restaurant had been closed soon after the business was taken over.
"The reason being was that it was not profitable," the report
quoted Mr. Hall as saying.
The report discloses that Wagamama in Australia had 10
restaurants, and -- except for the Southbank venue -- all will
continue to operate so the administrator can attempt to find a
buyer. Its other Melbourne restaurants are in Flinders Lane in
the CBD, and at Chadstone Shopping Centre, the report notes.
"We are continuing to trade them," the report quoted Mr. Hall as
saying. "It's business as usual, and it's early stages at this
point," Mr. Hall added, the report notes.
A statement from KPMG also said that the administrators for CLB
were working with Wagamama's landlords, suppliers and employees so
the business could continue to trade, the report discloses.
Wagamama launched in Britain in the 1990s and franchised operation
of its noodle chain to a company called CLB in Australia. The
first Wagamama opened in Melbourne in 2004, in St Kilda. The
Southbank outlet opened in 2011.
Wagamama is a Japanese restaurant chain.
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I N D I A
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3S INFRASTRUCTURE: CRISIL Reaffirms 'B' Rating on INR135MM Loan
---------------------------------------------------------------
CRISIL's rating on the bank facility of 3S Infrastructure
continues to reflect 3SI's small scale of operations owing to low
occupancy levels, and weak financial risk profile on account of
continuing cash losses. These rating weaknesses are partially
offset by the strong financial support 3SI receives from its
partners.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Term Loan 135 CRISIL B/Stable (Reaffirmed)
Outlook: Stable
CRISIL believes that 3SI's business and financial risk profiles
will remain constrained by its small scale of operations and
continuing cash losses over the medium term. The outlook may be
revised to 'Positive' if 3SI achieves better-than-expected
occupancy levels or enhances its scale of operation from its owned
stores, leading to improvement in its cash accruals. Conversely,
the outlook may be revised to 'Negative' if the support from
partners is lower than expected leading to pressure on its debt
servicing ability, or the firm undertakes any large debt-funded
capital expenditure programme.
3SI, established in 2006 as a partnership firm, was promoted by
Dr. Bal Sidhu, Mr. Sukhjinder Singh Khera, Mr. Santokh Singh
Khera, and Mr. Parduman Singh. The firm operates a mall - Centrium
Jyoti Mall - in Jalandhar (Punjab). The mall comprises five
levels, with total leasable area of 45,000 square feet. More than
50 percent of the mall's leasable space is occupied by the firm
through its own grocery store, restaurant, multi-brand outlets for
apparels, ladies footwear, etc. while around 30 percent is rented
out to Dominos, Addidas, Promart Retail and ATM Space to Yes Bank.
For 2012-13 (refers to financial year, April 1 to March 31), 3SI
provisionally reported a net loss of INR50 million on net sales of
INR34.5 million, as against a net loss of INR59.1 million on net
sales of INR39.4 million in 2011-12.
A. S. IRON: CRISIL Assigns 'BB' Ratings to INR200MM Loans
---------------------------------------------------------
CRISIL has assigned its 'CRISIL BB/Stable' rating to the long-term
bank facilities of A. S. Iron and Steels India Private Limited.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 50 CRISIL BB/Stable (Assigned)
Proposed Long-Term 150 CRISIL BB/Stable (Assigned)
Bank Loan Facility
The rating reflects the extensive industry experience of ASI's
promoters, and the company's moderate financial risk profile,
especially debt protection metrics. These rating strengths are
partially offset by ASI's modest scale of operations in the
intensely competitive iron & steel trading industry.
Outlook: Stable
CRISIL believes that ASI will continue to benefit over the medium
term from its promoters' longstanding industry experience. The
outlook may be revised to 'Positive' if better-than-expected cash
accruals and efficient working capital management strengthen ASI's
credit risk profile. Conversely, the outlook may be revised to
'Negative' if low cash accruals or sizeable working capital
requirements weaken its credit risk profile.
Set up in 1992, by Mr. Anand Kumar Agarwal and Mr. Sanjay Kumar
Agarwal, ASI trades in sponge iron, ingots, billets and TMT bars.
ASI also manufactures mild steel (MS) sections. The company is
based out of Secunderabad (Andhra Pradesh).
ASI reported a profit after tax (PAT) of INR2.7 million on an
operating income of INR1.8 billion for 2012-13 (refers to
financial year, April 1 to March 31), against a PAT of INR2.2
million on an operating income of INR870 million for 2011-12.
ALOM EXTRUSIONS: CRISIL Suspends BB+ Ratings on INR288.6MM Loans
----------------------------------------------------------------
CRISIL has suspended its ratings on the bank facilities of Alom
Extrusions Limited.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Bill Purchase- 20 CRISIL A4+ Suspended
Discounting
Facility
Cash Credit 20 CRISIL BB+/Stable Suspended
Cash Credit 90 CRISIL BB+/Stable Suspended
Letter of Credit/ 155 CRISIL BB+/Stable Suspended
Bank Guarantee
Term Loan 23.6 CRISIL BB+/Stable Suspended
The suspension of ratings is on account of non-cooperation by AEL
with CRISIL's efforts to undertake a review of the ratings
outstanding. Despite repeated requests by CRISIL, AEL is yet to
provide adequate information to enable CRISIL to assess AEL's
ability to service its debt. The suspension reflects CRISIL's
inability to maintain a valid rating in the absence of adequate
information. CRISIL considers information availability risk as a
key credit factor in its rating process and non-sharing of
information as a first signal of possible credit distress, as
outlined in its criteria 'Information Availability Risk in Credit
Ratings'.
AEL was incorporated in 1980 and promoted by Mr. Sawal Ram
Jhunjhunwala. The company manufactures aluminium-extruded
products, which are used in buildings and other architectural
structures, electronic and electrical transmission lines, consumer
durables, solar panels, and automotive appliances. The company has
two operating units, one each in Howrah (West Bengal) and in
Balasore (Odisha), with a combined capacity of 20,800 tonnes per
annum (tpa). The promoter of the company has recently set up a new
company, Alom Poly Extrusion Ltd (APEL), which is engaged in
manufacturing double-wall corrugated high-density polyethylene
pipes. The total project cost was around INR339 million, funded by
term loan of INR207 million and balance from equity capital from
promoters and AEL. The project was commissioned in April 2011.
ARYA GREEN: CRISIL Assigns 'B+' Ratings to INR100MM Loans
---------------------------------------------------------
CRISIL has assigned its 'CRISIL B+/Stable' rating to the long-term
bank facilities of Arya Green Energy.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Term Loan 45 CRISIL B+/Stable (Assigned)
Cash Credit 30 CRISIL B+/Stable (Assigned)
Proposed Long-Term 25 CRISIL B+/Stable (Assigned)
Bank Loan Facility
The rating reflects AGE's susceptibility to risks associated with
stabilisation of its operations, and the susceptibility of its
margins to volatility in raw material prices and to intense
competition. These rating weaknesses are partially offset by the
extensive experience of the firm's promoters' in the plastics
industry.
Outlook: Stable
CRISIL believes that AGE will continue to benefit over the medium
term from its promoters' extensive industry experience. The
outlook may be revised to 'Positive' if AGE stabilises operations
at its proposed plant in a timely manner and generates higher-than
expected revenue and profitability, leading to substantial cash
accruals and improvement in its capital structure. Conversely, the
outlook may be revised to 'Negative' if the firm's revenues and
profitability are lower than expected, or it contracts larger-
than-expected debt to fund its working capital, constraining its
capital structure and resulting in pressure on its liquidity.
Established in 2010, AGE is promoted by the Varmora group (Varmora
Granito Pvt Ltd, rated 'CRISIL BBB-/Stable/CRISIL A3') and others
partners. Mr. Dirubhai Adroja manages the firm's day-to-day
operations. AGE is setting up a polyvinyl chloride (PVC) flex-
banner plant, with a capacity to manufacture 9000 tonnes per annum
of PVC flex banners, in Morbi (Gujarat); the plant is expected to
be fully operational by December 2013.
BOUTIQUE HOTELS: CRISIL Reaffirms 'BB' Ratings on INR990MM Loans
----------------------------------------------------------------
The rating continues to reflect Boutique Hotels India Private
Limited susceptibility to a downturn in the hotel industry, its
small market share, and high geographic concentration. These
rating weaknesses are mitigated by BHIPL's long track record in
operating its hotel resort in Udaipur (Rajasthan).
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Proposed Long-Term 199.4 CRISIL BB/Stable (Reaffirmed)
Bank Loan Facility
Term Loan 790.6 CRISIL BB/Stable (Reaffirmed)
CRISIL had earlier, through its rating rationale dated July 02,
2013, downgraded its rating on Boutique Hotels India Pvt Ltd's
(BHIPL's) bank facilities to 'CRISIL BB/Stable' from 'CRISIL
BB+/Stable'.
The downgrade reflects BHIPL's weaker-than-expected liquidity
owing to delay in commencement of operations and low occupancy at
its resorts in Jaipur (Rajashtan). Revenues and cash accruals from
the resorts (operated and managed by Lebua) are also lower-than-
expected owing to low occupancy, which is expected to pick up
gradually over the medium term. BHIPL's liquidity was also
affected by cost overruns in the project and delay in receiving
the committed equity infusion by Foreign Direct Investment (FDI)
partner, Xander Investment Holding V Ltd and Xander Investment
Holding XXIV Ltd (collectively referred to as Xander), to support
the capital expenditure (capex). The delay in equity infusion
resulted from the delay in finalising the agreement between the
promoters and Xander regarding stake dilution by BHIPL's
promoters. CRISIL believes that BHIPL's cash accruals will remain
low as against its debt obligations over the medium term, but its
liquidity will be supported by sufficient cash balances from the
recent equity infusion and further funding support by the FDI
partner or promoters in case of a liquidity crunch.
Outlook: Stable
CRISIL believes that BHIPL will maintain its liquidity over the
medium term on the back of cash balances due to the recent equity
infusion and expected improvement in cash accruals on the back of
increased occupancy at its resorts in Jaipur. BHIPL will also get
funding support from the FDI partner or promoters in case of a
liquidity crunch. The outlook may be revised to 'Positive' if
BHIPL's revenues and cash accruals improve substantially at its
hotels. Conversely, the outlook may be revised to 'Negative' if
BHIPL's revenues and profitability are adversely affected by
lower-than-expected occupancy or average room rate (ARR) at its
hotels, or if the company undertakes a larger-than-expected debt-
funded capex programme, thereby weakening its capital structure.
BHIPL is a closely held private limited company promoted by the
Poddar family. Promoters have around 29 per cent equity stake,
while 71 per cent is held by (Xander). Xander is a Foreign company
based in Mauritius. BHIPL owns and operates three resorts, the
Devi Garh Palace, and Devi Ratna, and Rasa Amer in Jaipur. In
January 2013, lebua Hotels and Resorts took over the management of
all three resorts. The three properties have been rebranded Devi
Garh by LeBua, Udaipur, LeBua Resort, Jaipur, and LeBua Lodge at
Amer, Jaipur respectively.
On a provisional basis, for 2012-13, BHIPL reported a net loss of
around INR249 million on revenues of INR179 million, as against a
net loss of INR207 million on revenues of INR183 million for the
previous year.
FREEZE EXIM: CRISIL Assigns 'B' Ratings to INR11.9MM Loans
----------------------------------------------------------
CRISIL has assigned its 'CRISIL B/Stable/CRISIL A4' ratings to the
bank facilities of Freeze Exim.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Proposed Long-Term 5.9 CRISIL B/Stable (Assigned)
Bank Loan Facility
Packing Credit 45.0 CRISIL A4 (Assigned)
Long Term Loan 6.0 CRISIL B/Stable (Assigned)
Bank Guarantee 3.1 CRISIL A4 (Assigned)
Bill Discounting 20.0 CRISIL A4 (Assigned)
The ratings reflect FE's modest scale of operations in the
intensely competitive seafood industry, and its below-average
financial risk profile, marked by a modest net worth. These rating
weaknesses are partially offset by the extensive experience of
FE's partners in the seafood industry.
Outlook: Stable
CRISIL believes that FE will continue to benefit over the medium
term, from the extensive industry experience of its partners. The
outlook may be revised to 'Positive' if there is a significant
improvement in the firm's revenues and profitability, leading to a
better financial risk profile. Conversely, the outlook may be
revised to 'Negative' if FE's financial risk profile weakens, most
likely because of a decline in its cash accruals, large debt-
funded capital expenditure, or sizeable capital withdrawals by the
partners.
Established in 2000 in Kerala, FE is involved in the processing
and export of seafood such as squid, tuna, and cuttlefish. The
operations of the firm are managed by its four partners, Mr. K
Aboobacker, Mr. Usman Koya, Mr. Abdul Kader, and Mr. Faisal
Sulaiman.
FE reported a net profit of INR3.3 million on an operating income
of INR468 million for 2012-13 (refers to financial year, April 1
to March 31), against a net profit of INR4.3 million on operating
income of INR443 million for 2011-12.
FUTURISTIC EDUCATIONAL: CRISIL Puts 'B+' Ratings on INR95MM Loans
-----------------------------------------------------------------
CRISIL has assigned its 'CRISIL B+/Stable' rating to the long-term
bank facilities of Futuristic Educational Society.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Term Loan 70.9 CRISIL B+/Stable (Assigned)
Overdraft Facility 4.2 CRISIL B+/Stable (Assigned)
Proposed Long-Term 19.9 CRISIL B+/Stable (Assigned)
Bank Loan Facility
The ratings reflect FES's geographical concentration, intense
competition in the schools segment, small and limited track record
of operations and moderate financial risk profile. These
weaknesses are partially offset by FES's promoters' industry
experience, and healthy demand prospects of the education sector.
Outlook: Stable
CRISIL believes that FES will benefit over the medium term from
the improving market position of the society aided by improving
occupancy rate of it newly set up schools. The outlook may be
revised to 'Positive' if FES scales up its operations, diversifies
its course offerings and revenue sources while maintaining its
profitability and capital structure. Conversely, the outlook may
be revised to 'Negative' in case of a substantial decline in
revenues and profitability, or significantly higher-than-expected
debt-funded capital expenditure impacting the financial risk
profile.
FES has been set up in February 2008 to provide education in the
primary and secondary levels. The society is promoted by
Mr.T.Pandurangachari, B.Seenaiah, E.Narendra Prasad, EVL
Basaveswari, E.Manasa Choudhary, T.Rajasekhar, B.L.Harika, and
C.V.B Anand. The society currently is running 3 schools namely,
The Creek Planet School, Seeds School and Ambitus World School.
GEE EMM: CRISIL Assigns 'B' Ratings to INR80MM Loans
----------------------------------------------------
CRISIL has assigned its 'CRISIL B/Stable' rating to the long-term
bank facilities of Gee Emm Overseas.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Term Loan 12.5 CRISIL B/Stable (Assigned)
Cash Credit 60.0 CRISIL B/Stable (Assigned)
Proposed Long-Term 7.5 CRISIL B/Stable (Assigned)
Bank Loan Facility
The rating reflects GEO's modest scale of operations and
susceptibility of margins to input price volatility and changes in
government regulations. The rating also factors the firm's below-
average financial risk profile, marked by a modest net worth, high
gearing, and subdued debt protection metrics. These rating
weaknesses are partially offset by the extensive experience of
GEO's partners in the rice milling industry.
Outlook: Stable
CRISIL believes that GEO will continue to benefit over the medium
term from its partners' extensive experience in the rice milling
industry. The outlook may be revised to 'Positive' if the firm
achieves significant and sustainable improvement in its revenues,
while maintaining its margins and improving its capital structure.
Conversely, the outlook may be revised to 'Negative' if GEO
registers a significant decline in its revenues or margins, or
undertakes a larger-than-expected, debt funded capital expenditure
programme, resulting in weakening of its financial risk profile.
GEO was established as a partnership firm in 2010 by the Goyal
family. The Goyal family has been well established in the rice
milling industry since 1998. The firm is engaged in processing
basmati and parboiled rice. Its day-to-day operations are managed
by Mr. Naresh Goyal and his son, Mr. Archit Goyal. GEO's
manufacturing facility is in Moga (Punjab).
GEO reported (on a provisional basis) a profit after tax (PAT) of
INR1.4 million on net sales of INR97 million for 2012-13 (refers
to financial year, April 1 to March 31); it had reported a PAT of
INR0.4 million on net sales of INR44.2 million for 2011-12.
GREEN VALLEY: CRISIL Lowers Ratings on INR920MM Loans to 'BB'
-------------------------------------------------------------
CRISIL has downgraded its rating on the long-term bank facilities
of Green Valley's Shelters Pvt Ltd to 'CRISIL BB/Stable' from
'CRISIL BB+/Stable', and reaffirmed its rating on the company's
short-term facilities at 'CRISIL A4+'.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Bank Guarantee 140 CRISIL A4+ (Reaffirmed)
Cash Credit 600 CRISIL BB/Stable (Downgraded
from CRISIL BB+/Stable)
Overdraft Facility 100 CRISIL BB/Stable (Downgraded
from CRISIL BB+/Stable)
Proposed Long-Term 220 CRISIL BB/Stable (Downgraded
Bank Loan Facility from CRISIL BB+/Stable)
Short-Term Loan 110 CRISIL A4+ (Reaffirmed)
The rating downgrade reflects GVSPL's heightened risks in relation
to completion and saleability of its proposed projects. GVSPL is
undertaking six residential projects at a total cost of INR2.0
billion to INR2.3 billion, to be executed over the ensuing three
to four years. The project is expected to be funded through a debt
of INR634 million, with the remaining met through a mix of equity
and customer advances. CRISIL believes that the demand and
implementation risks in relation to these projects will remain
high, given the start-up nature of these projects. Hence, any
significant delay in these projects' saleability and consequent
delays in receipt of customer advances could lead to delays in
project execution, thereby impacting the company's liquidity and
financial risk profile.
The ratings, however, continues to reflect the experience of
GVSPL's promoters in the real estate development business and
their proven project execution capabilities. These rating
strengths are partially offset by GVSPL's exposure to risks
related to completion and saleability of its on-going and proposed
projects and geographic concentration in its revenue profile
Outlook: Stable
CRISIL believes that GVSPL will continue to benefit over the
medium term from the experience of its promoters in the real
estate development segment. The outlook may be revised to
'Positive' in case of larger-than-expected cash flows backed by
more-than-expected bookings from its projects along with their
timely implementation resulting in an improvement in financial
risk profile. Conversely, the outlook may be revised to 'Negative'
if there are any delays in the execution of the projects or in the
receipt of advances from customers, or the company contracts
larger-than-expected debt adversely impacting its financial risk
profile.
GVSPL, established in 2004, derives its revenues from residential
real estate development. The daily operations of the company are
managed by Mr. Thirumurugan and Mr. T Prabhakar.
GVSPL reported a profit after tax (PAT) of INR38.7 million on net
sales of INR737.9 million for 2012-13 (refers to financial year,
April 1 to March 31), as against a PAT of INR41.1million on net
sales of INR739.7 million for 2011-12.
JINDAL COTEX: CARE Cuts Ratings on INR162.26cr Loans to 'D'
-----------------------------------------------------------
CARE revises the ratings assigned to the bank facilities of Jindal
Cotex Limited.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank 127.26 CARE D Revised from CARE C
Facilities
Short-term Bank 35.00 CARE D Revised from CARE A4
Facilities
Rating Rationale
The rating takes into account the delays in servicing of the
company's debt obligations due to stretched liquidity and working
capital intensive operations.
JCL was promoted in 1998, by Mr Sandeep Jindal, Mr Yash Paul
Jindal, Mr Rajinder Jindal and Mr Ramesh Jindal. JCL is engaged in
manufacturing synthetic yarns, viz, acrylic yarn, polyester yarn,
cotton yarn and trading of textile products. JCL has manufacturing
facilities at Ludhiana, Punjab. As on March 31, 2012, JCL had an
installed capacity of 52,272 spindles for manufacturing acrylic,
blended and cotton yarn. Furthermore, JCL has two wholly owned
subsidiaries JML and JSTL which are engaged in the manufacturing
of medical products (eg, absorbent bleached cotton, cotton wool,
cotton crepe bandage, cotton rolls, cotton zig zags, cotton pads,
buds) and specialty textile products like polyvinyl chloride (PVC)
laminated banner fabric, respectively. There have been continuous
delays by JCL in debt servicing owing to its stretched liquidity
position emanating from cash losses during FY12 (refers to the
period April 01 to March 31) and working capital intensive
operations. Though in FY13, JCL had restructured a part of its
debt and had also taken a corporate loan which had eased its
liquidity situation for a brief period. However, continuous delays
in implementation of the projects in subsidiaries and delays
relating to their stabilization coupled with losses during Q1FY14
have led to stretched liquidity in JCL. JCL has now applied for
corporate debt restructuring and its proposal is under
consideration with its bankers.
During FY13, JCL recognized revenue (stand alone) of INR320.8
crore and a net profit of INR4.4 crore. In Q1FY14, JCL achieved a
total income of INR65.7 crore and a net loss of INR6.8 crore.
JINDAL MEDICOT: CARE Cuts Ratings on INR82cr Loans to 'D'
---------------------------------------------------------
CARE revises the ratings assigned to the bank facilities of
Jindal Medicot Limited.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank 82 CARE D Revised from CARE C
Facilities
Rating Rationale
The rating takes into account the ongoing delays in the servicing
of the company's debt obligations due to the initial project
stabilization issues and unsatisfactory operating performance.
Incorporated in May 2008, JML is a wholly-owned subsidiary of
Jindal Cotex Limited. In FY10 (refers to the period April 1 to
March 31), the company undertook a project for setting up a
unit at Una, Himachal Pradesh (HP) for manufacturing medical
textile products (annual capacity of 5,000 MTPA) like absorbent
bleached cotton and cotton crepe bandages in different varieties.
The project was commissioned in H1FY13 at a total project cost of
INR97 crore funded by a debt of INR58 crore and the balance
through promoter's equity and loans & advances. Before the
commissioning of the project, JML was engaged in the trading of
textile and metals during FY11 and FY12.
During FY12, JML reported a total income (trading) of INR47 crore
and a net loss of INR2 crore. JML has entered into restructuring
of its debt during FY13. However despite the restructuring, there
have been continuous delays in debt servicing by JML owing to the
initial stabilization issues and demand off-take risk.
JINDAL SPECIALTY: CARE Lowers Ratings on INR145cr Loans to 'D'
--------------------------------------------------------------
CARE revises the ratings assigned to the bank facilities of Jindal
Specialty Textiles Limited.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank 145 CARE D Revised from CARE C
Facilities
Rating Rationale
The rating takes into account the ongoing delays in the servicing
of the company's debt obligations due to a delay in project
implementation.
Incorporated in May 2008, JSTL is a wholly-owned subsidiary of
Jindal Cotex Limited. In FY10 (refers to the period April 1 to
March 31), the company undertook a project for setting up a
unit at Una, Himachal Pradesh (HP) for manufacturing technical
textile products (proposed annual capacity of 60 million square
meters) like PVC laminated products, frontlit banner, backlit
banner, inflatable banner, etc. The total cost of the project was
estimated to be INR151 crore proposed to be funded through a debt
of INR100 crore and the remaining through equity. However due to a
cost overrun, JSTL has incurred INR157 crore on the development of
the project funded through a debt of INR100 crore and the
remaining through promoter's equity. Before the commissioning of
the project, JSTL was engaged in the trading of textile and metals
during FY11 and FY12.
During FY12, JSTL reported a total income (trading) of INR15 crore
and a net loss of INR0.7 crore. Furthermore during H1FY13, JSTL
registered a total operating income of INR34 crore and a net loss
of INR3.9 crore. There has been continuous time and cost overrun
in the project implementation. After declaring COD in Q4FY13, JSTL
again closed the plant during H1FY14 due to stabilization issues.
Due to the inability of the company to successfully commence
commercial operations, there have been continuous delays in debt
servicing.
KAASHVI INDUSTRIES: CRISIL Suspends BB Rating on INR235.2MM Loans
-----------------------------------------------------------------
CRISIL has suspended its ratings on the bank facilities of
Kaashvi Industries.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 140 CRISIL BB/Stable Suspended
Letter of credit & 40 CRISIL A4+ Suspended
Bank Guarantee
Rupee Term Loan 95.2 CRISIL BB/Stable Suspended
The suspension of ratings is on account of non-cooperation by KI
with CRISIL's efforts to undertake a review of the ratings
outstanding. Despite repeated requests by CRISIL, KI is yet to
provide adequate information to enable CRISIL to assess KI's
ability to service its debt. The suspension reflects CRISIL's
inability to maintain a valid rating in the absence of adequate
information. CRISIL considers information availability risk as a
key credit factor in its rating process and non-sharing of
information as a first signal of possible credit distress, as
outlined in its criteria 'Information Availability Risk in Credit
Ratings'.
CRISIL has combined the business and financial risk profiles of KI
and its group company, Jay Ace Technologies Ltd (JATL),
collectively referred to as the Kaashvi group. This is because the
two entities are in the same line of business (manufacturing lead-
acid batteries). Moreover, KI's management is planning to merge KI
with JATL over the medium term.
KI was set up in 2006 by Mr. Amit Goyal and his brother, Mr. Anil
Goyal, as a partnership firm. In 2007, KI set up a conventional
lead-acid battery manufacturing plant at Roorkee (Uttarakhand). In
2008, JP Minda joined the firm as partner, and now owns 95 per
cent stake in the firm along with his family members; the rest is
owned by Mr. Amit Goyal. JP Minda is also promoter of Jay Ushin
Ltd (JUL) and JNS Instruments Ltd (JNS), companies that are
engaged in manufacturing automotive components. The Kaashvi
group's operations and management are managed by the Goyal
brothers; Mr. Amit Goyal handles marketing and Mr. Anil Goyal
looks after procurement and production side.
KORES (INDIA): CRISIL Reaffirms 'BB+' Rating on INR1.21BB Loans
---------------------------------------------------------------
CRISIL has revised its rating outlook on the long-term bank
facilities of Kores India Ltd to 'Positive' from 'Negative', while
reaffirming the rating on the same at 'CRISIL BB+'; the rating on
the company's short-term bank facilities has been reaffirmed at
'CRISIL A4+'.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Bank Guarantee 170 CRISIL A4+(Reaffirmed)
Cash Credit & 702.5 CRISIL BB+/Positive (Outlook
Working Capital revised from Negative and
demand loan Rating Reaffirmed)
Letter of Credit 310.0 CRISIL A4+(Reaffirmed)
Proposed Bank 50.0 CRISIL A4+(Reaffirmed)
Guarantee
Purchase Bill 50.0 CRISIL A4+(Reaffirmed)
Discounting
Term Loan 517.0 CRISIL BB+/Positive (Outlook
revised from Negative and
Rating Reaffirmed)
The outlook revision reflects CRISIL's belief that the company's
key credit metrics and liquidity will benefit over the near term,
driven by the completion of the ongoing sale of its pharmaceutical
and chemicals division (PCD) facility, located at Kurkumbh
(Maharashtra), and office space at Worli in Mumbai. The company
has recently received an advance of INR65 million towards sale of
these assets and is expected to receive the balance INR365 million
by November 30, 2013.
The funds are expected to be largely deployed towards reduction of
debt, thus benefitting Kores' key credit metrics and improving its
liquidity. The company's Kurkumbh unit has been incurring losses
since acquisition in August 2010, and divestment of this unit will
help improve Kores' profitability. Besides, steady growth and
improving profitability in the core conventional (trading in
office products) and textile business segments will also support
the company's operating cash flows, over the medium term. Timely
receipt of funds post completion of the sale of the PCD facility
and office space will remain a rating sensitivity factor.
The ratings continue to reflect Kores's diversified revenue
profile, established market position in the office products
segment, and favourable long-term outlook for the foundry and
engineering divisions. These rating strengths are partially offset
by Kores's working-capital-intensive operations, and average
financial risk profile.
Outlook: Positive
CRISIL believes that Kores' credit risk profile will benefit from
improvement in its office products and textile businesses as well
as the expected correction in its key credit protection metrics
due to funds expected from the sale of its loss making PCD unit at
Kurkumbh and office space in Worli. The ratings may be upgraded
subsequent to the lowering of debt levels from the receipt of
balance proceeds of INR365 million from the sale of assets.
Conversely, the outlook may be revised to 'Stable' if there is any
delay in receipt of the funds from the ongoing sale of Kores'
assets that results in its inability to lower debt levels, or in
case of deterioration in the company's business performance and
cash generation from Kores' core operations or if the company
undertakes any large, debt-funded capital expenditure (capex)
programme.
Kores was established in 1936 as a subsidiary of the Austrian
company, Kores Holding Zug AG. It initially manufactured office
stationery. In 1956, Kores was acquired by the late Mr. K L
Thirani. Since then, the company has diversified into distribution
of office and banking automation products, real estate,
pharmaceuticals, textiles, foundry, and fabrication of drilling-
related equipment. Kores is managed by Mr. Sushil Kumar Thirani
and Mr. Anand Kumar Thirani. In 2012-13 (refers to financial year,
April 1 to March 31), the company derived around 41 per cent of
its revenues from the office products segment, 30 per cent from
the foundry segment, 16 per cent from its textiles division, 11
per cent from PCD, and 2 per cent from the engineering segment.
Kores reported a net loss of INR89.3 million on net sales of
INR6.5 billion for 2012-13, as compared with a net loss of INR136
million on net sales of INR7.5 billion for 2011-12. For the three
months ended June 30, 2013, the company reported, on provisional
basis, a net loss of INR9.3 million on net sales of INR1.7 billion
as compared to net loss of INR36.8 million on net sales of INR1.7
billion for corresponding period in the previous year.
KSM SPINNING: CARE Upgrades Rating on INR115.84cr Loans to 'BB'
---------------------------------------------------------------
CARE revises the ratings assigned to the bank facilities of
KSM Spinning Mills Limited.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long term Bank 115.84 'CARE BB' Revised from
Facilities 'CARE B+'
Short term Bank 7.72 'CARE A4+' Revised from
Facilities 'CARE A4'
Rating Rationale
The revision in the ratings of KSM Spinning Mills Limited take
into account the improvement in the financial risk profile during
FY13 (refers to the period from April 1 to March 31) as
characterized by increased profitability and improved gearing
ratio and infusion of funds by the promoter in order to facilitate
the smooth execution of ongoing projects. The ratings, further,
continue to draw comfort from the experienced promoters and the
established relationships of the company with its customers. The
ratings, however, continue to be constrained by working-capital
intensive nature of operations, susceptibility of KSM's
profitability margins to fluctuations in raw material prices, low
bargaining power with suppliers and customers and the cyclical
nature of the industry.
Going forward, KSM's ability to effectively manage its working
capital requirements, withstand the raw material price volatility
and successfully derive the envisaged benefits from the completed
projects would remain the key rating sensitivities.
Incorporated in 2004, KSM is engaged in manufacturing of cotton
yarn, polyester yarn and polycotton (PC) yarn and trading of
fabrics. KSM, promoted by Mr Vipan Kumar Mittal, started
commercial production from May 2006 and has an installed capacity
of 31,968 spindles as on March 31, 2013 at its plant located at
Village Mandyala in Ludhiana (Punjab).
During FY13, KSM registered a total income of INR 160.57 crore
with net profit of INR4.34 crore.
LAKSHMI TRANSFORMERS: CRISIL Cuts Ratings on INR30MM Loans to 'B'
-----------------------------------------------------------------
CRISIL has downgraded its ratings on the bank loan facilities of
Lakshmi Transformers & Electricals to 'CRISIL B/Stable/CRISIL A4'
from 'CRISIL BB-/Stable/CRISIL A4+'.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Bank Guarantee 175 CRISIL A4 (Downgraded from
'CRISIL A4+')
Cash Credit 10 CRISIL B/Stable (Downgraded
from 'CRISIL BB-/Stable')
Cash Credit-
Book Debt 20 CRISIL B/Stable (Downgraded
from 'CRISIL BB-/Stable')
Letter of Credit 45 CRISIL A4 (Downgraded from
'CRISIL A4+')
The rating downgrade reflects sharp deterioration in LTE's
financial risk profile particularly its liquidity, on account of
significant stretch in firm's debtor collection cycle and
substantial capital withdrawals by partners despite operating
losses. LTE's high working capital intensity is reflected by its
high gross current asset (GCA) days of around 1125 days as on
March 31, 2013, primarily on account of its large debtors of
around 840days. LTE had outstanding debtors of INR180 million as
on March 31, 2013, of which around INR100 million were from UP SEB
for the bills raised in 2011-12. Though, the receivable position
has improved marginally in the current year, 2013-14, on account
of clientele diversification and partial realisation of debtors
from UPSEB to around INR110 million as on September 30, 2013 from
around INR180 million as on March 31, 2013; the debtors
outstanding for more than six months continue to remain high as on
September 30, 2013 resulting in continued high reliance on
external funding sources to fund the incremental working capital
requirements. Furthermore, LTE's partners have withdrawn around
INR19 million in 2012-13, despite operating losses during the year
as a result of which the net worth of the firm has eroded by
around INR40 million to around INR170 million as on March 31,
2013. CRISIL expects LTE's liquidity to remain stretched on
account of its high working capital intensity and its large
exposure to UP SEB.
The rating continues to reflect LTE's large working capital
requirements with high debtor risk, small scale of operations, and
susceptibility to intense competition in the transformer segment.
The ratings also reflect the firm's weak debt protection metrics.
These rating weaknesses are partially offset by LTE's partners'
extensive experience in the transformer manufacturing segment and
the financial support extended by them.
Outlook: Stable
CRISIL believes that LTE will continue to benefit over the medium
term from its partners' extensive experience in the transformers
industry. The outlook may be revised to 'Positive' in case of
substantial and sustained improvement in revenues and operating
margins from the current levels, resulting in higher-than-expected
cash accruals along with efficient working capital management,
particularly timely collection of receivables. Conversely, the
outlook may be revised to 'Negative' in case of any further
pressure on firm's revenues or profitability or a deterioration in
LTE's liquidity resulting from larger-than-expected working
capital requirements, most likely driven by larger-than-expected
delay in collection of receivables or withdrawal of capital by
partners or large debt-funded capital expenditure.
Established in 1991 by Mr. Sanjay Singhal and his family members,
LTE manufactures both power and distribution transformers. The
firm manufactures transformers ranging from 10 kVA (kilo volt
amperes) to 5000 kVA at its manufacturing facilities in Agra
(Uttar Pradesh) and Haridwar (Uttarakhand).
MJR STEELS: CRISIL Reaffirms BB+ Ratings on INR119.6MM Loans
------------------------------------------------------------
CRISIL's rating on the bank facilities of MJR Steels Pvt Ltd (MJR;
part of the MJR group) continues to reflect the MJR group's
diversified business risk profile, marked by revenue income from
its ship-breaking and steel trading businesses, and above-average
financial risk profile marked by a low total outside liabilities
to tangible net worth ratio.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Bank Guarantee 5.4 CRISIL A4+ (Reassigned)
Cash Credit 100.0 CRISIL BB+/Stable (Reaffirmed)
Proposed Long Term 19.6 CRISIL BB+/Stable (Reaffirmed)
Bank Loan Facility
These rating strengths are partially offset by the MJR group's
susceptibility to cyclicality and competition in the end-user
industries and vulnerability of the group's margins to
fluctuations in foreign exchange (forex) rates and to volatility
in scrap prices. Susceptibility of margins is partially offset by
active hedging practices followed by the management.
For arriving at its rating, CRISIL has combined the business and
financial risk profiles of MJR and JRD Industries (JRD). This is
because both these entities, together referred to as the MJR
group, have a common management and fungible cash flows.
Furthermore, MJR and JRD have provided corporate guarantees for
each other's bank facilities.
Outlook: Stable
CRISIL believes that the MJR group will continue to benefit over
the medium term from its diversified operations and its promoters'
experience in the steel trading and ship-breaking industries. The
outlook may be revised to 'Positive' if the group achieves larger-
than-expected revenues and profit margins, resulting in
improvement in its debt protection metrics. Conversely, the
outlook may be revised to 'Negative' if the MJR group's
profitability deteriorates, most likely because of fluctuations in
forex rates, or if its liquidity deteriorates, most likely because
of large capital expenditure or decline in its cash accruals.
The MJR group, based in Kolkata (West Bengal), trades in steel
intermediaries and scrap, and dismantles ships at Alang (Gujarat)
and Kolkata. MJR has been trading in steel products since 2003-04
(refers to financial year, April 1 to March 31). Till 2001, the
entity operated in the ship-breaking business. Because of a
downturn in the ship-breaking industry in 2002, MJR began trading
in steel products. JRD has been in the ship-breaking business
since 1991. Between 2002 and 2008, it had no operations because of
the downturn in the ship-breaking industry during that period. The
group's day-to-day operations are managed by its promoter, Mr.
Sanjiv Agarwal.
MJR's profit after tax (PAT) is estimated at INR3.9 million on net
sales of INR852.6 million for 2012-13 (refers to financial year,
April 1 to March 31), against a PAT of INR4.4 million on net sales
of INR1146.4 million for 2011-12.
MJR group's profit after tax (PAT) is estimated at INR10.4 million
on net sales of INR1648.0 million for 2012-13, against a PAT of
INR9.0 million on net sales of INR1663.8 million for 2011-12.
MAHALAXMI TMT: CARE Revises Ratings on INR717.17cr Loans to 'B'
---------------------------------------------------------------
CARE revises the ratings assigned to the bank facilities of
Mahalaxmi Tmt Pvt. Ltd.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank 717.17 CARE B Revised from
Facilities CARE B+ to CARE D and
then upgraded to CARE B
Short-term Bank 135.00 CARE A4 Revised from
Facilities CARE A4 to CARE D and
then upgraded to CARE A4
Rating Rationale
The revision in the ratings of Mahalaxmi TMT Pvt Ltd to 'CARE D'
is on account of delays in servicing of its debt obligations as a
result of its stressed liquidity arising from cash losses,
prolonged delay in commissioning of its direct reduced iron (DRI)
plant and large debt repayment obligations in the backdrop of
continuous predominantly debt funded capex plans. The subsequent
rating upgrade factors in regularisation of debt servicing of MTPL
for more than last three months with improvement in its liquidity
on the back of a moratorium in payment of interest and principal
for a majority of its debt under the approved scheme of Corporate
Debt Restructuring (CDR).
The ratings continue to be constrained by delays in receipt of VAT
refund, susceptibility to volatile raw material prices and
fluctuations in foreign exchange rate along with its presence in
the highly competitive and inherently cyclical steel industry.
The ratings, however, draw strength from the experienced promoter
group and various incentives offered by the Government of
Maharashtra due to its 'Mega Project' status.
MTPL's ability to generate envisaged returns post timely
completion of its ongoing capex within envisaged cost parameters
along with improvement in its profitability and capital structure
are the key rating sensitivities.
MTPL was originally promoted by Mr Sanjay Mantri and Mr Yogesh
Mandhani to set up MS Billets manufacturing facilities at Wardha,
Nagpur. Subsequently, in FY09 (refers to the period April 1 to
March 31) Mr. Ram Pal Soni, Chairman of Sangam Group, became the
new promoter of the company (currently holding controlling stake
at 61%) with a plan to set up an integrated steel plant under it.
MTPL was a dormant company till FY10 and it commenced operation of
billets and bars in April 2010 and January 2012 respectively. MTPL
has an installed capacity of 3,36,000 metric tons per annum (MTPA)
for billets and capacity of 5,00,000 MTPA for bars. The company
sells its products under the brand 'Sangam Steel'.
MTPL had approached its bankers for restructuring of its debt on
October 18, 2012 with the proposed cut-off date of August 1, 2012
on account of stretched liquidity. However, the bankers approved
the same on February 15, 2013 with the cut-off date of
November 1, 2012.
MAITRI EDUCATIONAL: CRISIL Assigns 'D' Ratings to INR140MM Loans
----------------------------------------------------------------
CRISIL has assigned its 'CRISIL D/CRISIL D' ratings to the bank
facilities of Maitri Educational Society.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Term Loan 89.4 CRISIL D (Assigned)
Bank Guarantee 48.0 CRISIL D (Assigned)
Proposed Long-Term 2.6 CRISIL D (Assigned)
Bank Loan Facility
The ratings reflect instances of delay by MES in servicing its
term debt obligations; the delays were caused by the society's
weak liquidity. MES has weak liquidity because of delay in receipt
of fees leading to subdued cash accruals
MES is also susceptible to adverse regulatory changes and, intense
competition in the educational sector. These rating weaknesses are
partially offset by the diversified revenue profile, and
promoters' extensive industry experience.
MES was set-up in the year 2004 and offers degree courses in
nursing and dentistry. The society started with a nursing college
(offering Bachelor of Science - B.Sc) in 2004 and then dental
course (offering BDS - Bachelor of Dental Surgery) in 2005. The
society has also started courses in Master of Science (M. Sc) in
nursing from 2009-10 and Master of Dental Surgery (MDS) in 2012-
13. The society is affiliated to Ayush & Health Science University
(AHSU), Raipur.
MICO PLAST: CARE Assigns 'BB-' Rating to INR17.49cr Loans
---------------------------------------------------------
CARE assigns 'CARE BB-/ CARE A4' ratings to the bank facilities of
Mico Plast Industries Private Limited.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank 17.49 CARE BB- Assigned
Facilities
Short-term Bank 0.80 CARE A4 Assigned
Facilities
Rating Rationale
The ratings assigned to the bank facilities of Mico Plast
Industries Private Limited are constrained by its small scale of
operations, the implementation risk associated with an ongoing
debt-funded capex, susceptibility of the profitability margins to
the raw material prices and the highly fragmented nature of the
industry owing to a large number of organized as well as
unorganized players. The ratings, however, derive strength from
the long track record of the business operations with experienced
promoters, integrated operations of the group, established
business relations with key customers, moderate capital structure
and debt service indicators and favorable outlook for the flexible
packaging industry. The ability of the company to increase its
scale of operations will remain as the key rating sensitivity.
Mico Plast Industries Private Limited is a Chennai-based company
incorporated in June 1991 by Mr R Naresh Kumar, Mrs A Suraj
Kumari, Mr R Agarchand and Mrs N Sumitra. MPIPL is engaged in the
manufacturing of flexible packaging materials like Polypropylene
bags, tubes, LDPE films, Lamination pouches, Rolls and Sheets with
an overall installed capacity of 3000 Metric Tonnes Per Annum
(MTPA) at its manufacturing facility located at Vyasarpudi,
Chennai. The products manufactured by the company are mainly used
for packaging of food products and are also used in the textile
industry. The company sells its products to domestic customers
based in Tamil Nadu including its group concern Maruthi Plastics &
Packaging (Chennai) Pvt Ltd. The main raw materials of MPIPL are
polyethylene tubes, LLDPE granules, solvent & adhesives and ink
which are procured domestically and also from its group concern
Mico Poly Pack.
During FY12 (refers to the period April 1 to March 31), MPIPL
reported a total operating income of INR33.95 crore and a PAT of
INR1.07 crore. During FY13, MPIPL reported a total operating
income of INR39.05 crore and a PAT of INR0.50 crore.
MOLISATI VINIMAY: CRISIL Reaffirms B+ Rating on INR108.5MM Loan
---------------------------------------------------------------
CRISIL's rating on the bank facility of Molisati Vinimay Pvt Ltd
continues to reflect its susceptibility to unstable natural
sunlight, and low plant load factor. The rating also reflects
MVPL's average financial risk profile, marked by weak debt
protection measures and modest net worth, despite its moderate
capital structure. The above-mentioned rating weaknesses are
partially offset by the benefits that the company derives from its
power purchase agreement (PPA) with Grid Corporation of Odisha Ltd
(GRIDCO).
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Long-Term Loan 108.5 CRISIL B+/Stable (Reaffirmed)
Outlook: Stable
CRISIL believes that MVPL will maintain its credit risk profile,
supported by its 25-year PPA, and timely cashflows from GRIDCO.
The outlook may be revised to 'Positive' if MVPL registers larger-
than-expected accruals, backed by an improved plant load factor
(PLF) while sustaining its working capital cycle, or if the
company calls back the unsecured loans extended to group
companies. Conversely, the outlook may be revised to 'Negative' if
MVPL's liquidity stretches following delays in payments from
GRIDCO, or if its PLF worsens.
MVPL was incorporated in Rourkela (Odisha) in 2005. The company is
promoted by Mr. Y Dalmia and his wife, Mrs. S Dalmia. MVPL
operates a one-megawatt solar power plant in Odisha.
NAMAHA ESTATES: CRISIL Assigns 'B+' Ratings to INR200MM Loans
-------------------------------------------------------------
CRISIL has assigned its 'CRISIL B+/Stable' rating to the long-term
bank facilities of Namaha Estates.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 100 CRISIL B+/Stable (Assigned)
Proposed Long-Term 100 CRISIL B+/Stable (Assigned)
Bank Loan Facility
The rating reflects NE's susceptibility to risks related to the
completion and saleability of its ongoing real estate residential
projects in Hyderabad (Andhra Pradesh), and to cyclicality in the
Indian real estate industry. These rating weaknesses are partially
offset by the established regional presence of NE's promoters,
backed by their long-standing experience in the residential real
estate development segment.
Outlook: Stable
CRISIL believes that NE will continue to benefit from its
established track record in the real estate industry in Hyderabad,
and the extensive industry experience of its promoters. The
outlook may be revised to 'Positive' if the firm reports earlier-
than-expected completion, and sale of its projects, thereby
improving its financial risk profile. Conversely, the outlook may
be revised to 'Negative' if there are any delays in project
completion, or in the receipt of advances from customers, or if
the firm undertakes a larger-than-expected debt-funded project,
thereby weakening its financial risk profile.
Established in 1999 as a partnership entity, Namaha Estates (NE)
constructs and sells real estate projects in and around Hyderabad.
The firm is promoted by Dr. K L Narayana, Mr. P Prem Kumar and Mr.
T Suresh Babu.
NAMCO COMMODITIES: CARE Cuts Ratings on INR105cr Loans to 'D'
-------------------------------------------------------------
CARE revises the ratings assigned to the bank facilities of
Namco Commodities Private Limited (formerly known as Longrange
Infrastructure Private Limited).
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank 10 CARE D Revised from CARE B
Facilities
Short-term Bank 95 CARE D Revised from CARE A4
Facilities
Rating Rationale
The revision in the ratings of the bank facilities of Namco
Commodities Private Limited (NCPL; formerly known as Longrange
Infrastructure Private Limited) takes in to account delays in the
servicing of its debt obligations on account of its stressed
liquidity position primarily due to its exposure to inherent
commodity price and foreign exchange rate fluctuation risk.
Incorporated in July 2010, NCPL is promoted by the Namco group of
Indore mainly engaged in trading of coal, steel products and non-
ferrous metals. It procures traded goods both through imports as
well as domestic market and supplies them in the domestic market.
FY11 (refers to the period April 1 to March 31) was the first full
year of operations for NCPL.
During FY12 (refers to the period April 1 to March 31), NCPL
reported total operating income of INR229.83 crore and PAT of
INR0.48 crore as against total operating income of INR174.93 crore
and PAT of INR0.84 crore during FY11. As per provisional results
for 9MFY13, NCPL reported total operating income of INR176.46
crore and Profit Before Tax (PBT) of INR0.97 crore.
NAMCO CORP: CARE Lowers Ratings on INR444.11cr Loans to 'D'
-----------------------------------------------------------
CARE revises the ratings assigned to the bank facilities of Namco
Corp Limited.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank 104.11 'CARE D' Revised from
Facilities 'CARE BB'
Short-term Bank 340.00 'CARE D' Revised from
Facilities 'CARE A4'
Rating Rationale
The revision in the ratings of the bank facilities of Namco Corp
Limited takes in to account delays in the servicing of its debt
obligations due to stress in liquidity primarily arising out of
huge foreign exchange loss incurred on its un-hedged payables.
Namco Corp Limited was incorporated as Namco Steels Private
Limited in 2007 and was converted to a public limited company in
2009. It is the flagship company of the Namco group based at
Indore. NCL is mainly engaged in trading of different kinds of
flat steel products and shredded scrap.
As per audited results for FY13 (refers to the period April 1 to
March 31), NCL reported a total operating income of INR685.61
crore (P.Y. INR681.28 crore) and a Net Loss of INR71.43 crore
[P.Y. Profit after Tax (PAT) of INR3.89 crore].
NAMCO INDUSTRIES: CARE Lowers Ratings on INR385.58cr Loans to 'D'
-----------------------------------------------------------------
CARE revises the ratings assigned to the bank facilities of Namco
Industries Private Limited.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank 194.60 'CARE D' Revised from
Facilities 'CARE B+'
Short-term Bank 190.98 'CARE D' Revised from
Facilities 'CARE A4'
Rating Rationale
The revision in the ratings of the bank facilities of Namco
Industries Private Limited takes in to account delays in the
servicing of its debt obligations due to stress on its liquidity
primarily arising on account of subdued cash accruals from the
recently commenced project in the backdrop of higher debt
repayment obligations.
Promoted by Shri Namit Soni and family, Namco Industries Private
Limited was incorporated on August 3rd 2009 and is part of the
Namco Group based out of Indore. NIPL has forayed in the
manufacturing segment by setting up a steckel-cum-plate mill for
rolling upto 2000 mm wide plates and strips with a total capacity
of 350,000 Metric Tonnes per Annum (MTPA) as on March 31, 2013.
The plant commenced commercial production from March 2013. The
delay in commencement was mainly on account of unavailability of
power supply post commissioning of the project.
As per audited results for FY13 (refers to the period April 1 to
March 31), NIPL reported a total operating income of INR86.66
crore and Profit after Tax (PAT) of INR0.06 crore during the one
month of operations in the year.
NOBLE MOULDS: CRISIL Lowers Ratings on INR135MM Loans to 'D'
------------------------------------------------------------
CRISIL has downgraded its ratings on bank facilities of Noble
Moulds Pvt Ltd to 'CRISIL D/CRISIL D' from 'CRISIL C/CRISIL A4'.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 95 CRISIL D (Downgraded from
'CRISIL C')
Letter of Credit 40 CRISIL D (Downgraded from
'CRISIL A4')
The ratings downgrade reflects continuous delay in repayment of
NMPL's term loans and instances of excess drawing in its cash
credit facility and devolvement of letters of credit that have
remained unpaid for more than 30 days. The same is attributed to
NMPL's weak liquidity arising from its working-capital-intensive
operations.
NMPL has a weak financial risk profile, marked by high gearing and
weak debt protection metrics. Moreover, it also has small scale of
operations and customer concentration in its revenues. The
company, however, benefits from the experience of its promoters in
the manufacture of consumer durables.
For arriving at its ratings, CRISIL has considered the business
and financial risk profiles of NMPL on a standalone basis, based
on management's stance that the company is managed independently
and transactions with group companies are on an arm's length
basis.
CRISIL had earlier combined the business and financial risk
profiles of NMPL, Noble Industries (NI), and Airvision India Pvt
Ltd (AIPL), together referred to as the Noble group, as all the
entities are controlled by the same management, are engaged in the
same businesses, and had operational linkages.
NMPL, set up in 1999, manufactures mouldings and other plastic
products used in electronic goods such as televisions, washing
machines and refrigerators. Its facilities are located in Noida
(Uttar Pradesh).
NORTHERN SKY: CRISIL Upgrades Ratings on INR250MM Loans to 'B+'
---------------------------------------------------------------
CRISIL has upgraded its rating on the long-term bank facilities of
Northern Sky Properties Private Limited to 'CRISIL B+/Stable' from
'CRISIL B/Stable'.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Long-Term Loan 195 CRISIL B+/Stable (Upgraded
from 'CRISIL B/Stable')
Proposed Long-Term 55 CRISIL B+/Stable (Upgraded
Bank Loan Facility from 'CRISIL B/Stable')
The rating upgrade reflects CRISIL's belief that NSPPL will report
sizeable cash flow from its ongoing 'Northern Sky City' project in
Mangalore (Karnataka), supported by healthy bookings for the
project. The company's cash accruals are expected to be sufficient
to service its maturing debt over the medium term, on account of
healthy profitability. The upgrade also reflects likelihood of
gradual reduction in NSSPL's exposure to project-related risks,
given that around 40 per cent of its ongoing project is already
complete.
The rating continues to reflects NSPPL's below-average financial
risk profile, marked by modest net worth and high gearing, and
susceptibility to risks related to completion and saleability of
other towers in the ongoing residential real estate project in
Mangalore (Karnataka). These rating weaknesses are partially
offset by the extensive industry experience of NSPPL's promoters
in the Mangalore real estate industry.
Outlook: Stable
CRISIL believes that NSPPL will continue to benefit over the
medium term from its promoters' extensive experience in real
estate development in Mangalore. The outlook may be revised to
'Positive' if NSPPL achieves strong growth in its cash flows,
driven most likely by earlier-than-expected completion of its
ongoing projects and receipt of advances, and more-than-expected
sales realisations from the residential properties. Conversely,
the outlook may be revised to 'Negative' if the company faces
delays in completion of the ongoing projects or receipt of
payments from customers, if it is unable to sell its ongoing
residential project at profitable rates, or if it undertakes a
large, debt-funded capital expenditure programme, leading to
deterioration in its financial risk profile.
NSPPL was established in April 2011. The company is developing a
residential complex at Mangalore (Karnataka). The company is
promoted by Mr. Dheeraj Amin and his family.
OM PRAKASH: CRISIL Reaffirms 'B+' Ratings on INR130MM Loans
-----------------------------------------------------------
CRISIL's ratings on the bank facilities of Om Prakash Amarnath
continue to reflect the extensive experience of its promoters in
the civil construction industry. The rating strength is offset by
OPA's small scale of operations and weak financial risk profile.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Bank Guarantee 70 CRISIL A4 (Reaffirmed)
Cash Credit 50 CRISIL B+/Stable (Reaffirmed)
Mortgage Loan Facility 30 CRISIL B+/Stable (Reaffirmed)
Proposed Long-Term
Bank Loan Facility 50 CRISIL B+/Stable (Reaffirmed)
Outlook: Stable
CRISIL believes that OPA will continue to operate on a small scale
over the medium term. The outlook may be revised to 'Positive' if
the firm scales up its operations significantly, while improving
its profitability and financial risk profile. Conversely, the
outlook may be revised to 'Negative' if OPA's financial risk
profile deteriorates because of sizeable working capital
requirements, or a decline in profitability.
OPA is a partnership firm, undertaking civil construction projects
on contract basis over the past six decades. Mr. Omprakash Khatri
and his son, Mr. Shiva Khatri, are 50 per cent partners (each).
OPA has executed several projects for private companies and
government agencies, including the Indore Development Authority.
OPA reported a net profit of INR12.2 million on an operating
income of INR179.7 million for 2012-13 (refers to financial year,
April 1 to March 31), vis-…-vis a net profit of INR16.7 million on
an operating income of INR183.9 million in 2011-12.
PURBANCHAL LUMBERS: CRISIL Reaffirms 'B+' Rating on INR30MM Loans
-----------------------------------------------------------------
CRISIL's ratings on the bank loan facilities of Purbanchal Lumbers
Private Limited continue to reflect its below average financial
risk profile, marked by modest networth, aggressive levels of
indebtedness (ratio of total outside liabilities to tangible net
worth), and modest scale of operations in the fragmented timber
industry. These rating weaknesses are partially offset by
promoter's extensive experience in timber industry.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 30 CRISIL B+/Stable (Reaffirmed)
Letter of Credit 250 CRISIL A4 (Reaffirmed)
Outlook: Stable
CRISIL believes that PLPL will maintain its credit risk profile
backed by its promoter's extensive experience in timber industry.
The outlook may be revised to 'Positive' in case of any
significant improvement in financial risk profile either by
improvement in accruals or large equity infusion. Conversely, the
outlook may be revised to 'Negative' in case of decline in PLPL's
profitability or deterioration in liquidity with stretch in
receivables.
PLPL was incorporated in 2000 and is promoted by Mr. Rakesh
Agarwal, Mr. Mukesh Agarwal and Mr. Omprakash Agarwal. The Company
is engaged in trading and processing of timber logs at its
facility located at Gandhidham, Gujarat. Purbanchal predominantly
trades in the timber imported from Myanmar, Malaysia and New
Zealand. In 2012-13, company has also started trading in other
products like Particle Board, Core Veneer, Ply wood and Teak wood.
In 2012-13, PLPL is estimated to report net profit at INR3 million
on sales of INR686.7 million, as against a net profit of INR1.7
million on net sales of INR490.5 million for 2011-12.
PV SONS: CRISIL Suspends 'BB' Ratings on INR125MM Loans
-------------------------------------------------------
CRISIL has suspended its ratings on the bank facilities of PV Sons
Corn Milling Company Private Limited.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 80 CRISIL BB/Stable Suspended
Letter of credit &
Bank Guarantee 15 CRISIL A4+ Suspended
Proposed Long-Term 3.6 CRISIL BB/Stable Suspended
Bank Loan Facility
Rupee Term Loan 41.4 CRISIL BB/Stable Suspended
The suspension of ratings is on account of non-cooperation by PV
Corn with CRISIL's efforts to undertake a review of the ratings
outstanding. Despite repeated requests by CRISIL, PV Corn is yet
to provide adequate information to enable CRISIL to assess PV
Corn's ability to service its debt. The suspension reflects
CRISIL's inability to maintain a valid rating in the absence of
adequate information. CRISIL considers information availability
risk as a key credit factor in its rating process and non-sharing
of information as a first signal of possible credit distress, as
outlined in its criteria 'Information Availability Risk in Credit
Ratings'.
PV Corn was incorporated as a limited company in 2003 by the
Chheda family and is promoted by second generation entrepreneurs
of Chheda family, Mr. Parag Chheda, Mr. Mehul Chheda, Mr. Mayur
Chheda, Mr. Niket Chheda and Mr. Paresh Chheda. The company is
engaged in corn milling operations and began commercial production
in 2006. The plant has an annual corn milling capacity of around
3, 60,000 tonnes and rice milling capacity of 1,20,000 tonnes. The
company plans to increase its annual corn milling capacity by
15,000 tonnes in 2011-12, by incurring a capital expenditure of
around INR20 million. In addition, the company also plans to
increase the storage capacity by 10,000 tonnes by incurring a
capex of around INR30 million. The new capacity is expected to
commence commercial production by January 2012.
QVC EXPORTS: CRISIL Reaffirms 'BB-' Ratings on INR30MM Loans
------------------------------------------------------------
CRISIL's ratings on the bank facilities of QVC Exports Pvt Ltd
continue to reflect the extensive experience of QVC's promoter in
the metals and minerals trading industry. The rating strength is
partially offset by the company's moderate scale of operations,
low profitability margins, and exposure to risks related to
volatility in commodity prices and foreign exchange rates.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Bank Guarantee 10 CRISIL A4+ (Reaffirmed)
Cash Credit 20 CRISIL BB-/Stable (Reaffirmed)
Export Packing 120 CRISIL A4+ (Reaffirmed)
Credit
Letter of Credit 100 CRISIL A4+ (Reaffirmed)
Proposed Long Term 10 CRISIL BB-/Stable (Reaffirmed)
Bank Loan Facility
Standby Line of 10 CRISIL A4+ (Reaffirmed)
Credit
Outlook: Stable
CRISIL believes that QVC will continue to benefit over the medium
term from its established position in the metals and minerals
trading industry, its promoter's extensive industry experience,
and its established relationships with customers. The outlook may
be revised to 'Positive' if there is a substantial and sustained
improvement in the company's revenues and profitability margins,
resulting in an improvement in its debt protection metrics, or if
it receives sizeable equity infusion. Conversely, the outlook may
be revised to 'Negative' in case of a steep decline in QVC's
profitability margins, or significant weakening in its capital
structure, most likely because of larger-than-expected working
capital requirements or any significant debt-funded capital
expenditure.
QVC, set up in 2005 by Mr. Nilesh Sharma, trades in a variety of
metals and minerals, such as iron, steel, ferroalloys, copper,
nickel, aluminium, manganese ore, coal, and coke.
For 2012-13 (refers to financial year, April 1 to March 31), QVC
reported a profit after tax (PAT) of INR4.8 million on net sales
of INR904.8 billion, against a PAT of INR10.2 million on net sales
of INR1215.7 million for 2011-12.
RAGHUVAR (INDIA): CRISIL Puts 'B+' Ratings on INR378.5MM Loans
--------------------------------------------------------------
CRISIL has revoked the suspension of its ratings on the bank
facilities of Raghuvar (India) Ltd, and has assigned its 'CRISIL
B+/Stable/CRISIL A4' ratings to the company's bank facilities.
CRISIL had, on September 28, 2012, suspended its ratings on RIL's
bank facilities as the company had not provided the necessary
information required for a rating review. The company has now
shared the requisite information, enabling CRISIL to assign a
rating to its bank facilities.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Bank Guarantee 1.5 CRISIL A4 (Assigned;
Suspension Revoked)
Cash Credit 247.5 CRISIL B+/Stable (Assigned;
Suspension Revoked)
Term Loan 80.0 CRISIL B+/Stable (Assigned;
Suspension Revoked)
Proposed Long-Term 51.0 CRISIL B+/Stable (Assigned;
Bank Loan Facility Suspension Revoked)
The ratings reflect the susceptibility of RIL's operating margin
to volatility in raw material prices, and the company's weak
financial risk profile marked by high gearing and weak debt
protection metrics. These rating weaknesses are partially offset
by the extensive experience of RIL's promoters in the edible oil
industry and the company's established distribution network.
Outlook: Stable
CRISIL believes that RIL will maintain its business risk profile
over the medium term on the back of its established distribution
network and its promoters' extensive experience in the edible oil
industry. The outlook may be revised to 'Positive' in case of
improvement in RIL's financial risk profile because of significant
improvement in its operating margin along with sustained revenue
growth. Conversely, the outlook may be revised to 'Negative' if
the company faces a steep decline in profitability or undertakes a
larger-than-expected debt-funded capital expenditure programme.
RIL is a part of the Alwar (Rajasthan)-based Data group and was
acquired in 2004 from Turner Morisson (Times of India Group). RIL
manufactures mustard oil, vanaspati oil, refined oil, and oil
cakes. It markets its products under its Hanuman brand. The
company also manufactures crockery. It has two manufacturing
facilities in Jaipur (Rajasthan).
RIL reported a profit after tax (PAT) of INR4.2 million on net
sales of INR3389.8 million for 2012-13 (refers to financial year,
April 1 to March 31), against a PAT of INR5.4 million on net sales
of INR2882.4 million for 2011-12.
RAKSAN TRANSFORMERS: CRISIL Rates INR70MM Cash Credit at 'B+'
-------------------------------------------------------------
CRISIL has assigned its 'CRISIL B+/Stable/CRISIL A4' ratings to
the bank facilities of Raksan Transformers Pvt Ltd.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 70 CRISIL B+/Stable (Assigned)
Bank Guarantee 30 CRISIL A4 (Assigned)
Bill Discounting 70 CRISIL A4 (Assigned)
The ratings reflect RTPL's weak financial risk profile, marked by
high gearing and small net worth, and large working capital
requirements. The ratings also factor in the company's small scale
of operations in the intensely competitive transformers industry.
These rating weaknesses are partially offset by the extensive
experience of RTPL's promoters in the transformers industry.
Outlook: Stable
CRISIL believes that RTPL will benefit from the promoters'
extensive experience in the transformers industry. The outlook may
be revised to 'Positive' if the company improves its capital
structure either by equity infusion or higher-than-expected cash
accruals, backed by improvement in scale of operations along with
improvement in its working capital management. Conversely, the
outlook may be revised to 'Negative', if RTPL's financial risk
profile deteriorates because of lower-than-expected top-line and
profitability, leading to low cash accruals, or larger-than-
expected debt-funded capital expenditure. Significant weakening of
RTPL's liquidity on account of large working capital requirements
may also result in a 'Negative' outlook.
RTPL was incorporated in 1995 by the Kanda family based in Sonipat
(Haryana). Mr. Sanjeev Kanda is the key promoter and managing
director of the company. Initially, the company traded in,
manufactured, and repaired transformers and its parts. In 2004,
RTPL exited the trading and repairing segment and started
manufacturing distribution transformers ranging from 25 kilovolt-
ampere (KVA) to 200 KVA. The manufacturing capacity is located in
Sonipat.
RTPL reported a net profit of INR4.51 million on net sales of
INR241.2 million for 2012-13 (refers to financial year, April 1 to
March 31), against a net profit of INR1.85 million on net sales of
INR132.3 million for 2011-12.
RANJEET AUTOMOBILES: CRISIL Suspends BB Ratings on INR120MM Loans
-----------------------------------------------------------------
CRISIL has suspended its rating on the bank facilities of Ranjeet
Automobiles.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 110 CRISIL BB/Stable Suspended
Proposed Cash 10 CRISIL BB/Stable Suspended
Credit Limit
The suspension of ratings is on account of non-cooperation by RA
with CRISIL's efforts to undertake a review of the ratings
outstanding. Despite repeated requests by CRISIL, RA is yet to
provide adequate information to enable CRISIL to assess RA's
ability to service its debt. The suspension reflects CRISIL's
inability to maintain a valid rating in the absence of adequate
information. CRISIL considers information availability risk as a
key credit factor in its rating process and non-sharing of
information as a first signal of possible credit distress, as
outlined in its criteria 'Information Availability Risk in Credit
Ratings'.
Set up in 1983 by Mr. Gurjeet Singh Bajaj Bhopal (Madhya Pradesh)-
based RA commenced operations by initially manufacturing
batteries; however, in 1984, it started trading in Exide
batteries. The firm currently also trades in Su-Kam, Luminous and
Microtek inverters; Bridgestone, MRF, Goodyear and JK tyres; and
spare parts for earth moving machines manufactured by Lucas TVS,
Denso India, and Seagold. The firm has four branch offices, four
warehouses, and two retail showrooms in Bhopal totalling around
30,000 to 40,000 square feet of operation space in Bhopal.
RATNADEEP METAL: CRISIL Reaffirms 'B' Ratings on INR470MM Loans
---------------------------------------------------------------
CRISIL's ratings on the bank loan facilities of Ratnadeep Metal &
Tubes Ltd continue to reflect RMTL's working-capital-intensive and
modest scale of operations leading to weak financial risk profile
marked by weak debt protection metrics. These rating weaknesses
are partially offset by RMTL's established track record in the
seamless and welded steel pipes and tubes segment.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Bank Guarantee 45 CRISIL A4 (Reaffirmed)
Cash Credit 280 CRISIL B/Stable (Reaffirmed)
Letter of Credit 185 CRISIL A4 (Reaffirmed)
Proposed Long-Term
Bank Loan Facility 36.4 CRISIL B/Stable (Reaffirmed)
Term Loan 153.6 CRISIL B/Stable (Reaffirmed)
Outlook: Stable
CRISIL believes that RMTL will maintain its business risk profile
over the medium term backed by its promoter's extensive experience
in the industry. However, the financial flexibility will remain
under pressure due to working capital intensive operations over
the medium term. The outlook may be revised to 'Positive' in case
the company's working capital management improves significantly
leading to improvement in its financial risk profile. Conversely,
the outlook may be revised to 'Negative', if the company's
liquidity stretches further on account of increase in its working
capital requirements and/or company contracts higher than expected
debt for the capex further deteriorating the debt servicing
ability.
Update
For 2012-13 (refers to financial year, April 1 to March 31),
RMTL's turnover is estimated to be higher than CRISIL's
expectation at INR1120 million. The company has clocked in y-o-y
double digit growth reflecting the healthy demand of its product.
For the period till June 2013 of the current year of 2013-14, the
company has clocked in the turnover to the tune of INR230-250
million and going forward CRISIL believes that RMTL will continue
its growth momentum and will be able to post double digit growth
on the back off healthy demand reflected from its current order
book position of INR400 million & improving realization by
increasing focus on its exports sales. The company plans to
undertake debt funded capex to the tune of INR80 million to
enhance its installed capacity to service the future demand. In
2012-13 RMTL reported operating margins of 10.7 per cent and the
company is able to maintain its margins at operating levels close
to 11.0 per cent since past four years ended as on March 2013
reflecting its ability to maintain its margins in different
business cycles. CRISIL believes that the company's strategy to
move in the high value products such as Titanium pipes coupled
with increasing export focus would help the company to increase
the scale of operations through improved realization however; the
cost of materials would also move in tandem and constrain the
margins at 10-11 per cent over the medium term. In the year 2012-
13, the company's working capital requirements are estimated to be
higher than CRISIL's expectation with GCA days at 255 days
primarily because of higher inventory holdings. Going forward, no
significant change is expected in RMTL's GCA days & the overall
working capital requirements are expected to rise with its scale
of operations.
However the financial risk profile is expected to remain
constrained with high gearing, below average debt protection
metrics and stretched liquidity. As of March 2013 the gearing of
the company is estimated to increase y-o-y to ~1.69 times on
account of total debt increase to support its incremental working
capital requirements. Going forward post the debt funded capex in
the year 2013-14, the gearing is expected to remain close to 2012-
13 levels on account of capital infusion to the tune of INR20
million. Over the medium term the gearing is estimated to remain
close to 1.86 times. The liquidity remains stretched influenced by
high working capital requirements coupled with low financial
flexibility. Its average bank lines utilization for past trailing
12 months ended as of March 2013 continues to remain high at 96.5
per cent. However, the promoter's contribution as well as expected
enhancement in its bank lines is expected to provide some support
to its liquidity position.
RMPL reported a net profit of INR20.3 million on sales of INR1120
million for 2012-13, against a net profit of INR29.4 million on
net sales of INR994 million for 2011-12.
RMTL was incorporated in 2002 by Mr. Bharat Sanghavi and Mr.
Jayant Jain and is engaged in manufacturing of seamless and welded
steel pipes and tubes. The company manufactures stainless steel
(SS) seamless and welded tubes, carbon steel (CS) seamless tubes
and alloy steel seamless tubes. The company has two manufacturing
facilities located near Ahmedabad (Gujarat).
REPUBLIC AUTO: CARE Rates INR9.25cr LT Bank Loans at 'B+'
---------------------------------------------------------
CARE assigns 'CARE B+' rating to the bank facilities of Republic
Auto Sales.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank 9.25 CARE B+ Assigned
Facilities
The ratings assigned by CARE are based on the capital deployed by
the partners and the financial strength of the firm at present.
The ratings may undergo a change in case of the withdrawal of the
capital or the unsecured loans brought in by the partners in
addition to the financial performance and other relevant factors.
Rating Rationale
The rating assigned to the bank facilities of Republic Auto Sales
are constrained by its fluctuating total operating income and low
net-worth base, thin profitability margins and leveraged
capital structure. The rating is further constrained by the high
competitive intensity of the business and constitution of the
entity being a partnership firm. The rating also takes cognizance
of the fortunes linked to the performance of Escorts Tractors
Limited and India Yahama Motor Pvt Limited.
The rating, however, draws comfort from the experienced partners,
association with Escorts & Yahama and favorable industry prospects
for tractors & two-wheelers in the long-term.
Going forward, the ability of RAS to increase the scale of
operations along with an improvement in the profitability margins
and the capital structure shall be the key rating sensitivities.
Republic Auto Sales was formed in April 2005 as a partnership firm
by Mohd Zubair (aged 57 years), Mohd Tariq (aged 54 years), Ms
Shama Sheikh (aged 52 years) and Ms Shagufta Tariq (aged 49 years)
with profit sharing ratios of 40%, 40%, 10% and 10%. RAS operates
as an authorized dealer of Escorts for tractors and Yahama for
two-wheelers. RAS operates 3S facility (Sales, Spares, Service) at
Lucknow, Uttar Pradesh.
RAS reported a PAT of INR0.35 crore on a total income of INR82.44
crore in FY12 (refers to the period April 01 to March 31). As per
provisional results, RAS has reported a PAT of INR0.35 crore on a
total income of INR97.86 crore in FY13.
S T WOVEN: CARE Assigns 'B+' Rating to INR9.35cr LT Bank Loans
--------------------------------------------------------------
CARE assigns 'CARE B+' rating to the bank facilities of S T Woven
Bags Private Limited.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank 9.35 CARE B+ Assigned
Facilities
Rating Rationale
The rating assigned to the bank facilities of S T Woven Bags
Private Limited is primarily constrained on account of the risk
associated with the predominantly debt-funded green field
project which has recently commissioned. The rating is further
constrained on account of the lack of experience of the promoters
in the packaging industry, vulnerability of margins to volatile
input prices and its presence in the highly fragmented industry.
The rating, however, favourably takes into account the location
advantage and benefits available under Technology Upgradation Fund
Scheme (TUFS) of the Ministry of Textiles, Government of India and
Rajasthan Investment Promotion Scheme, 2010.
The ability of the company to stabilize its newly established
facility will be the key rating sensitivity.
SWBPL, incorporated in September 2011, was promoted by Mr Ramesh
Kumar Tak along with his wife Ms Asha Tak. SWBPL was incorporated
with an objective to set up a greenfield plant by installing 50
looms for manufacturing of woven sack bags at Silora, Ajmer. Woven
sack bags are manufactured from Polypropylene (PP) or High Density
Polyethylene (HDPE) and find their application in packaging salt,
cement, rice, sugar, seeds and cattle feed etc. The company has
started its commercial operations from May 16, 2013 after partial
completion of its project. It has installed 46 looms at an
aggregate cost of INR13.90 crore, which was funded with a debt
equity mix of 1.44:1. The plant has an installed capacity of 3,261
Metric Tonnes Per Annum (MTPA). The remaining four looms are
expected to be installed by November 20, 2013, thereby resulting
in increase in the total installed capacity to 3,545 MTPA. The
cost of the remaining four looms will be funded by unsecured loans
by the promoter group.
The company procures its primary raw material (PP) from Reliance
Industries Limited as well as HPCL Mittal Energy Limited and sells
woven sack bags to various cement manufacturing units and
traders located in and around Rajasthan. Apart from manufacturing,
the company is also engaged in job work.
Till September 30, 2013, the company has reported a turnover of
INR6.70 crore.
SAHIBZADA TIMBER: CRISIL Assigns 'B' Rating to INR150MM Loan
------------------------------------------------------------
CRISIL has assigned its 'CRISIL B/Stable/CRISIL A4' ratings to the
bank facilities of Sahibzada Timber & Ply Pvt Ltd.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 150 CRISIL B/Stable (Assigned)
Letter of Credit 15 CRISIL A4 (Assigned)
The ratings reflect STPL's modest scale of operations in a
fragmented industry, average financial risk profile, marked by a
high total outside liabilities to tangible net worth (TOLTNW)
ratio, and vulnerability to changes in regulations on timber
import. These rating weaknesses are partially offset by the
extensive experience of the promoters in the timber business and
established customer base.
Outlook: Stable
CRISIL believes that STPL will maintain a stable business risk
profile on the back of the promoters' extensive experience in the
timber trading industry; however, its financial risk profile will
remain constrained over the medium term due to working-capital-
intensive operations leading to high debt levels. The outlook may
be revised to 'Positive' if the company's scale of operations
improves along with improvement in working capital management
leading to a better financial risk profile. Conversely, the
outlook may be revised to 'Negative' if there is more-than-
expected increase in the working capital requirements, or if the
financial risk profile deteriorates in case of any adverse
government policy leading to decline in revenue.
STPL was set up in 1992 as a proprietorship firm, Sahibzada Timber
and Ply, by Mr. Narinder Singh Sandhu; the firm was reconstituted
as a private limited company with the current name on June 30,
2012. The company processes and trades in timber logs. STPL is
promoted by the Sandhu family and has its head office at Mohali
(Chandigarh). The company's day-to-day operations are managed by
Mr. Sandhu and his son, Mr. Jaspratap Singh Sandhu.
STPL's net profit and net sales were estimated at INR7.9 million
and INR320 million, respectively, for 2012-13 (refers to financial
year, April 1 to March 31); the company reported net profit of
INR7.3 million on net sales of INR280 million for 2011-12.
SAHIL AUTOMOBILES: CARE Rates INR9.8cr LT Bank Loans at 'BB'
------------------------------------------------------------
CARE assigns 'CARE BB' rating to the bank facilities of Sahil
Automobiles.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank 9.80 CARE BB Assigned
Facilities
The rating assigned by CARE is based on the capital deployed by
the proprietor and the financial strength of the firm at present.
The rating may undergo a change in case of the withdrawal of
capital or the unsecured loans brought in by proprietor in
addition to the financial performance and other relevant factors.
Rating Rationale
The rating is primarily constrained on account of the small scale
of operations of Sahil Automobiles in the highly competitive
automobile dealership business, its constitution as a
proprietorship firm, thin profitability and high working capital
intensity of its operations. The rating, however, derives strength
from the vast experience of the proprietor in managing the
automobile dealership business along with a long-standing
association with its key principal -- Honda Motorcycle & Scooter
India Private Limited and stable demand outlook for the two-
wheeler segment.
The ability of SA to increase its scale of operations along with
an improvement in profitability and effective management of its
working capital in a highly competitive automobile dealership
business are the key rating sensitivities.
Incorporated in 2001, SA is a proprietorship firm headed by Ms
Sanita Arora. Based out of Jabalpur, Madhya Pradesh, SA is engaged
in two-wheeler automobile dealership business as an authorized
dealer of HMSI. The Arora family had initially started with the
dealership business of Vespa Scooters in 1996, Yamaha Motorcycles
in 1991 which were later on followed by HMSI in 2001 and Maruti
Suzuki India Limited (MSIL) in 2004. SA's showrooms are supported
with 3-S (Sales, Services and Spare Parts) facilities.
SAKET ENGINEERS: CRISIL Ups Ratings on INR1.07BB Loans to 'B-'
--------------------------------------------------------------
CRISIL has upgraded its ratings on the bank facilities of Saket
Engineers Pvt Ltd to 'CRISIL B-/Stable/CRISIL A4' from 'CRISIL
D/CRISIL D'.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 65.0 CRISIL B-/Stable (Upgraded from
'CRISIL D')
Bank Guarantee 100.0 CRISIL A4 (Upgraded from
'CRISIL D')
Long-Term Loan 755.0 CRISIL B-/Stable (Upgraded from
'CRISIL D')
Proposed Long- 250.0 CRISIL B-/Stable (Upgraded from
Term Bank Loan 'CRISIL D')
Facility
The rating upgrade reflects timely servicing of debt by SEPL over
the last six months ended September 30, 2013. The upgrade also
reflects CRISIL's belief that SEPL will continue to service its
debt in a timely manner over the medium term, following
improvement in its liquidity driven by substantial increase in
customer advances for its real estate projects.
The ratings reflect SEPL's exposure to risks related to the
implementation of, and offtake from, its ongoing projects, and to
risks and cyclicality inherent in the real estate industry. These
rating weaknesses are partially offset by SEPL's established track
record in the real estate segment in Hyderabad (Andhra Pradesh),
supported by its promoter's extensive experience in the
construction business.
Outlook: Stable
CRISIL believes that SEPL will continue to benefit over the medium
term from its established presence in the real estate development
business in Hyderabad and its promoter's extensive industry
experience. The outlook may be revised to 'Positive' if the
company registers more-than-expected realisations from its ongoing
projects, leading to considerable improvement in its liquidity.
Conversely, the outlook may be revised to 'Negative' in case of
time or cost overruns in the company's ongoing projects, or if the
company undertakes large debt-funded projects resulting in
deterioration in its capital structure.
Set up by Mr. T Radhakrishnan in 1993, SEPL is engaged in
residential real estate development; the company also undertakes
civil work on contract basis. SEPL is developing three projects--
Saket Sriyam, Saket Pranaam, and Saket Bhu: Satva--in Hyderabad,
and one project -- Saket Callipolis -- in Bengaluru (Karnataka).
SAMOSARAN SYNTEX: CRISIL Reaffirms BB+ Rating on INR250MM Loan
--------------------------------------------------------------
CRISIL has revised its rating outlook on the long-term bank
facilities of Samosaran Syntex Pvt Ltd (SSPL; part of the
Samosaran group) to 'Stable' from 'Negative', while reaffirming
the rating at 'CRISIL BB+'. The rating on SSPL's short-term bank
facilities has been reaffirmed at 'CRISIL A4+'.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 250 CRISIL BB+/Stable (Outlook
Revised from 'Negative'
and Rating Reaffirmed)
Letter of Credit 125 CRISIL A4+ (Reaffirmed)
The revision reflects the group's stronger-than-expected financial
risk profile, backed by improved cash accruals and equity
infusion, which is expected to be maintained over the medium term.
The group's promoters infused equity of INR50 million and
unsecured loans of INR50 million in 2012-13 (refers to the
financial year, April 1 to March 31) leading to lower-than-
expected dependence on bank borrowings for incremental working
capital requirements. Additionally, the group's increasing
manufacturing turnover has led to improvement in operating margin
to 7.7 per cent in 2012-13 from 5.50 to 6.50 per cent
historically. Led by an equity infusion and an increase in
operating margins, the Samosaran group's provisional gearing of
2.3 times (treating unsecured loans from promoters as neither debt
nor equity) as on March 31, 2013 has improved from 2.60 times as
on March 31, 2012. The group's interest coverage ratio of 2.4
times and net cash accruals to total debt ratio of 0.17 times in
2012-13 are also better than CRISIL previously expected. The
Samosaran group has another capital expenditure (capex) of INR335
million in 2013-14 to increase the spindle capacity, which will be
funded with a debt of INR260 million. CRISIL, however, believes
that the group will maintain its improved financial risk profile
over the medium term backed by steady accretion to reserves.
The ratings continue to reflect the Samosaran group's established
market position in the synthetic yarn industry and moderate
working capital requirements. These rating strengths are partially
offset by the group's average financial risk profile, marked by
aggressive gearing and average debt protection metrics, and
limited pricing flexibility given the commoditised nature of its
products.
For arriving at its ratings, CRISIL has combined the business and
financial risk profiles of SSPL and Samosaran Yarns Pvt Ltd
(SYPL). This is because the two companies, together referred to as
the Samosaran group, have common promoters and derive significant
business synergies from each other.
Outlook: Stable
CRISIL believes that the Samosaran group will continue to benefit
from its established track record in the industry. The outlook may
be revised to 'Positive' in case of better-than-expected accretion
to reserves or significant equity infusion, leading to further
improvement in financial risk profile. Conversely, the outlook may
be revised to 'Negative' if the Samosaran group undertakes larger-
than-expected debt-funded capex or if there is a material decline
in operating margin or net cash accrual generation. The outlook
may also be revised to 'Negative', or in case of lengthening of
working capital cycle, leading to deterioration in financial risk
profile.
The Samosaran group was established in the 1940s by the Mumbai-
based Jain family. Set up in June 2007, SSPL trades in yarn.
SSPL's group company, SYPL, which was set up in 2006, manufactures
and trades in synthetic yarn. SYPL has plants in Bhiwandi
(Maharashtra) and Silvassa (Union Territory of Dadra and Nagar
Haveli). The overall operations are managed by Mr. Jindas Jain and
his brother Mr. Hasmukh Jain.
For 2012-13, on a provisional basis, SYPL reported a profit after
tax (PAT) of INR21.6 million on net sales of INR1686.6 million;
the company reported a net loss of INR12.4 million on net sales of
INR1.482 billion for 2011-12.
For 2012-13, SSPL reported a PAT of INR21.9 million on net sales
of INR1.866 billion as against a PAT of INR15.78 million on net
sales of INR1.919 billion for 2011-12.
SAMOSARAN YARNS: CRISIL Reaffirms 'BB+' Ratings on INR801MM Loans
-----------------------------------------------------------------
CRISIL has revised its rating outlook on the long-term bank
facilities of Samosaran Yarn Pvt Ltd (SYPL; part of the Samosaran
group) to 'Stable' from 'Negative', while reaffirming the rating
at 'CRISIL BB+'. The rating on SYPL's short-term bank facilities
has been reaffirmed at 'CRISIL A4+'.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Bank Guarantee 15 CRISIL A4+ (Reaffirmed)
Cash Credit 300 CRISIL BB+/Stable (Outlook
Revised from 'Negative' and
Rating Reaffirmed)
Long-Term Loan 494.7 CRISIL BB+/Stable (Outlook
Revised from 'Negative' and
Rating Reaffirmed)
Proposed Long-Term 6.3 CRISIL BB+/Stable (Outlook
Bank Loan Facility Revised from 'Negative' and
Rating Reaffirmed)
The revision reflects the group's stronger-than-expected financial
risk profile, backed by improved cash accruals and equity
infusion, which is expected to be maintained over the medium term.
The group's promoters infused equity of INR50 million and
unsecured loans of INR50 million in 2012-13 (refers to the
financial year, April 1 to March 31) leading to lower-than-
expected dependence on bank borrowings for incremental working
capital requirements. Additionally, the group's increasing
manufacturing turnover has led to improvement in operating margin
to 7.7 per cent in 2012-13 from 5.50 to 6.50 per cent
historically. Led by an equity infusion and an increase in
operating margins, the Samosaran group's provisional gearing of
2.3 times (treating unsecured loans from promoters as neither debt
nor equity) as on March 31, 2013 has improved from 2.60 times as
on March 31, 2012. The group's interest coverage ratio of 2.4
times and net cash accruals to total debt ratio of 0.17 times in
2012-13 are also better than CRISIL previously expected. The
Samosaran group has another capital expenditure (capex) of INR335
million in 2013-14 to increase the spindle capacity, which will be
funded with a debt of INR260 million. CRISIL, however, believes
that the group will maintain its improved financial risk profile
over the medium term backed by steady accretion to reserves.
The ratings continue to reflect the Samosaran group's established
market position in the synthetic yarn industry and moderate
working capital requirements. These rating strengths are partially
offset by the group's average financial risk profile, marked by
aggressive gearing and average debt protection metrics, and
limited pricing flexibility given the commoditised nature of its
products.
For arriving at its ratings, CRISIL has combined the business and
financial risk profiles of SYPL and Samosaran Syntex Pvt Ltd. This
is because the two companies, together referred to as the
Samosaran group, have common promoters and derive significant
business synergies from each other.
Outlook: Stable
CRISIL believes that the Samosaran group will continue to benefit
from its established track record in the industry. The outlook may
be revised to 'Positive' in case of better-than-expected accretion
to reserves or significant equity infusion, leading to further
improvement in financial risk profile. Conversely, the outlook may
be revised to 'Negative' if the Samosaran group undertakes larger-
than-expected debt-funded capex or if there is a material decline
in operating margin or net cash accrual generation. The outlook
may also be revised to 'Negative', or in case of lengthening of
working capital cycle, leading to deterioration in financial risk
profile.
The Samosaran group was established in the 1940s by the Mumbai-
based Jain family. Set up in June 2007, SSPL trades in yarn.
SSPL's group company, SYPL, which was set up in 2006, manufactures
and trades in synthetic yarn. SYPL has plants in Bhiwandi
(Maharashtra) and Silvassa (Union Territory of Dadra and Nagar
Haveli). The overall operations are managed by Mr. Jindas Jain and
his brother Mr. Hasmukh Jain.
For 2012-13, on a provisional basis, SYPL reported a profit after
tax (PAT) of INR21.6 million on net sales of INR1686.6 million;
the company reported a net loss of INR12.4 million on net sales of
INR1.482 billion for 2011-12.
For 2012-13, SSPL reported a PAT of INR21.9 million on net sales
of INR1.866 billion as against a PAT of INR15.78 million on net
sales of INR1.919 billion for 2011-12.
SHRIGANESH TEXFAB: CARE Rates INR18.05cr LT Bank Loans at 'B'
-------------------------------------------------------------
CARE assigns 'CARE B' rating to the bank facilities of Shriganesh
Texfab Private Limited.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank 18.05 CARE B Assigned
Facilities
Rating Rationale
The rating assigned to the bank facilities of Shriganesh Texfab
Limited is primarily constrained on account of restructuring of
its bank debt obligations in May, 2013 due to stressed
liquidity backed by cash losses in FY13 on account of
underachievement of envisaged level of sales along with financial
risk profile marked by weak solvency position. The rating is
further constrained on account of its modest scale of operations
with limited presence in the textile value chain and its presence
in highly fragmented fabric processing industry. The rating,
however, derives strength from the experienced management and
location advantage by way of proximity to its raw material as well
as major customers.
The ability of the company to increase its scale of operations as
well as better management of working capital will be the key
rating sensitivity.
Bhilwara (Rajasthan) based STL, incorporated in 1998 was promoted
by Mr. Kunj Bihari Agarwal. STL is engaged in the business of
processing of synthetic grey fabrics i.e. dying and printing on
job work basis and trading of finished fabrics. The plant of the
company is located at Bhilwara having total installed capacity of
3.60 crore Meters Per Annum (MPA) as on March 31, 2013. It has
utilized 82% of its installed capacity in FY13 (refers to the
period from April 1 to March 31) as compare to 95% in FY12.
During FY12, STL reported a total income of INR32.78 crore with a
PAT of INR0.05 crore. As per provisional result of FY13, the
company has achieved total operating income of INR 31.73 crore
with net losses of INR4.77 crore.
SHREE VENKATESH: CRISIL Suspends BB+ Rating on INR375MM Loan
------------------------------------------------------------
CRISIL has suspended its rating on the bank facility of Shree
Venkatesh Buildcon Private Limited.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 375 CRISIL BB+/Stable Suspended
The suspension of ratings is on account of non-cooperation by
SVBPL with CRISIL's efforts to undertake a review of the ratings
outstanding. Despite repeated requests by CRISIL, SVBPL is yet to
provide adequate information to enable CRISIL to assess SVBPL's
ability to service its debt. The suspension reflects CRISIL's
inability to maintain a valid rating in the absence of adequate
information. CRISIL considers information availability risk as a
key credit factor in its rating process and non-sharing of
information as a first signal of possible credit distress, as
outlined in its criteria 'Information Availability Risk in Credit
Ratings'.
Incorporated in 2010, SVBPL is promoted by Mr. Ankush Asbe. The
company is part of the Venkatesh group based in Pune (Maharashtra)
and is engaged in residential real estate development in the city.
The group started undertaking real estate development in 2000-01
(refers to financial year, April 1 to March 31) and has completed
around nine residential real estate projects. The group has booked
revenues of around INR1.7 billion over the past four years. The
group has three other ongoing projects that are being executed in
other group entities. Currently, SVBPL is developing two
residential projects - Lake Vista and Venkatesh Sharvil - with 653
flats and 186 flats, respectively. Construction of both the
projects started in December 2010 and is expected to be completed
by December 2013.
SONAL ADHESIVES: CRISIL Cuts Rating on INR110MM Loan to 'BB-'
-------------------------------------------------------------
CRISIL has downgraded its ratings on the bank facilities of Sonal
Adhesives Ltd to 'CRISIL BB-/Negative/CRISIL A4' from CRISIL
BB+/Stable/CRISIL A4+'.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 110 CRISIL BB-/Negative (Downgraded
from CRISIL BB+/Stable)
Letter of Credit 112 CRISIL A4 (Downgraded from
CRISIL A4+)
The rating downgrade reflects the sharp deterioration in SAL's
financial risk profile, particularly its liquidity. The
deterioration in liquidity is on account of lower-than-expected
cash accruals from enhanced capacities in a muted demand scenario,
coupled with increased working capital intensity. SAL has
undertaken a capital expenditure (capex) of about INR80 million to
increase its capacity, debt-funded to the extent of INR43 million.
As the internal accruals were utilised to fund the equity portion
of the capex, the company's reliance on external debt increased,
marked by almost fully utilised bank lines of INR110 million for
the six months through September 2013. SAL's ability to ensure
offtake from the enhanced facilities, while improving its
liquidity position will determine the rating direction over the
medium term.
CRISIL has discontinued combining the business and financial risk
profiles of SAL and its group company Sonal Impex Ltd (SIL), as
there has been no major operating or financial linkages between
the two companies. .
The rating continues to reflect the extensive experience of SAL's
promoters in the adhesives industry. This rating strength is
partially offset by the company's large working capital
requirements, small scale of operations, and vulnerability to raw
material price volatility.
Outlook: Negative
CRISIL believes that SAL's financial risk profile, particularly
its liquidity, will remain constrained due to large working
capital requirements and sizeable debt repayment obligations over
the medium term. The rating may be downgraded if SAL is unable to
ramp up its scale of operations, while maintaining its
profitability and working capital cycle. Conversely, the outlook
may be revised to 'Stable' if SAL's capital structure and
liquidity improve due to infusion of longterm funds or there is a
significant increase in cash accruals.
Promoted by Mr. Mohan Arora in 1981, the Mumbai-based SAL became a
public company in 1994. SAL manufactures self-adhesive tapes,
acrylic adhesives, and synthetic ropes.
SAL reported a profit after tax (PAT) of INR5.0 million on net
sales of INR572.8 million for 2012-13 (refers to financial year,
April 1 to March 31), against a PAT of INR4.7 million on net sales
of INR493.4 million for 2011-12.
SPANISO STUDIO: CRISIL Reaffirms BB- Ratings on INR40MM Loans
-------------------------------------------------------------
CRISIL has assigned its 'CRISIL BB-/Stable/CRISIL A4+' ratings to
the bank facilities of Spaniso Studio.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 15.0 CRISIL BB-/Stable (Reaffirmed)
Letter of Credit 60.0 CRISIL A4+ (Reaffirmed)
Proposed Long-Term 25.0 CRISIL BB-/Stable (Reaffirmed)
Bank Loan Facility
The ratings reflect the extensive experience of Spaniso's
promoters in the tiles industry, and the firm's moderate financial
risk profile marked by low gearing and above-average debt
protection metrics, albeit constrained by modest net worth. These
rating strengths are partially offset by Spaniso's modest scale of
operations and exposure to risks related to its high dependence on
the cyclical real estate industry for revenue.
Outlook: Stable
CRISIL believes that Spaniso will continue to benefit over the
medium term from its promoters' extensive experience in the tiles
industry. The outlook may be revised to 'Positive' in case of
substantial improvement in the firm's scale of operations and
profitability, or improvement in its financial flexibility, most
likely because of significant capital infusion by the promoters.
Conversely, the outlook may be revised to 'Negative' in case of a
steep decline in the firm's scale of operations and profitability
or deterioration in its working capital cycle, leading to pressure
on its liquidity.
Spaniso is a partnership firm based in Kerala and established in
2009. The firm trades in ceramic and vitrified tiles. It is
managed by Mr. Fibin C, Mr. Prabeesh AP, and Ms. K Nisha.
Spaniso reported a net profit of INR2.4 million on total sales of
INR314.1 million for 2011-12 (refers to financial year, April 1 to
March 31), against a net profit of INR1.8 million on total sales
of INR291.9 million for 2010-11.
STANDARD AUTO: CARE Rates INR24.52cr LT Bank Loans at 'BB'
----------------------------------------------------------
CARE assigns 'CARE BB' and 'CARE A4+' ratings to the bank
facilities of Standard Auto Agencies.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank 24.52 CARE BB Assigned
Facilities
Short-term Bank 1.00 CARE A4+ Assigned
Facilities
The rating assigned by CARE is based on the capital deployed by
the proprietor and the financial strength of the firm at present.
The rating may undergo a change in case of withdrawal of capital
or the unsecured loans brought in by the proprietor in addition to
the financial performance and other relevant factors.
Rating Rationale
The ratings are primarily constrained on account of the modest
scale of operations of Standard Auto Agencies (SAA) along with its
constitution as a proprietorship firm, thin profitability and
high leverage. The ratings are further constrained by the high
working capital intensity of its operations and the challenging
environment for the automobile dealership industry due to the
subdued demand amidst high competitive intensity within the
industry.
The ratings, however, derive strength from the vast experience of
the proprietor in managing the automobile dealership business and
established operations of SAA along with a long-standing
association with its key principal - Maruti Suzuki India Limited.
SAA's ability to increase its scale of operations and improve its
profitability in a highly competitive automobile dealership
business along with an effective management of its working capital
are the key rating sensitivities.
Incorporated in 1986, SAA is a proprietorship firm headed by Mr
Deepak Arora based out of Jabalpur, Madhya Pradesh. Currently, SAA
is engaged in the automobile dealership business of passenger
vehicles (PVs) for MSIL. Having initially started with the
dealership businesses of Vespa Scooters in 1986, followed by
Yamaha Motorcycles in 1991 and Honda Motorcycles & Scooters
India Private Limited (HMSI) in 2001, SAA was able to bag
dealership business of MSIL in 2004 on the back of their previous
dealership experience. SAA's showrooms, service centres and
stockyards are supported with 3-S (sales, service and spare parts)
and 2-S (service and spare parts) facilities.
SAA reported a PAT of INR1.78 crore on a total operating income of
INR140.36 crore in FY13 (refers to the period April 1 to
March 31) as against a PAT of INR1.25 crore on a total operating
income of INR121.88 crore in FY12.
SUMATEX LIMITED: CRISIL Suspends BB+ Ratings on INR125.5MM Loans
----------------------------------------------------------------
CRISIL has suspended its ratings on the bank facilities of Sumatex
Limited.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 100 CRISIL BB+/Stable Suspended
Letter of Credit 50 CRISIL A4+ Suspended
Rupee Term Loan 25.5 CRISIL BB+/Stable Suspended
The suspension of ratings is on account of non-cooperation by
Sumatex with CRISIL's efforts to undertake a review of the ratings
outstanding. Despite repeated requests by CRISIL, Sumatex is yet
to provide adequate information to enable CRISIL to assess
Sumatex's ability to service its debt. The suspension reflects
CRISIL's inability to maintain a valid rating in the absence of
adequate information. CRISIL considers information availability
risk as a key credit factor in its rating process and non-sharing
of information as a first signal of possible credit distress, as
outlined in its criteria 'Information Availability Risk in Credit
Ratings'.
Sumatex was set up in 1998 as Sumatex Services Pvt Ltd by Mr.
Sudeep Malu. In 2008, the company was reconstituted as a closely
held public limited company and its name was changed to the
current one. The company is the only manufacturer in India for
electronic selvedge machines used in the textile industry. Its
manufacturing unit is located in Bhilwara (Rajasthan). Sumatex is
also working towards manufacturing computerised jacquards
machines, which are used to create intricate patterns while
weaving fabric. For funding the capex for setting up the plant and
meeting working capital requirements, the company has proposed to
make an initial public offering (IPO).
SUNSHINE FASTENERS: CRISIL Reaffirms BB Rating on INR187.3M Loans
----------------------------------------------------------------
CRISIL's ratings on the bank facilities of Sunshine Fasteners Pvt
Ltd (part of the Sunshine group) continue to reflect the long and
established track record of the Sunshine group's promoters in the
fasteners industry, and its moderate financial risk profile marked
by a comfortable capital structure and moderate debt protection
metrics. These rating strengths are partially offset by Sunshine
group's small scale of operations in a highly fragmented industry,
and working capital intensive operations.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 120.0 CRISIL BB/Stable (Reaffirmed)
Letter of Credit 5.0 CRISIL A4+ (Reaffirmed)
Term Loan 48.0 CRISIL BB/Stable (Reaffirmed)
Proposed Long-Term 19.3 CRISIL BB/Stable (Reaffirmed)
Bank Loan Facility
On May 31, 2013 the ratings on the bank facilities of SFPL were
reaffirmed at 'CRISIL BB/Stable/CRISIL A4+'.
For arriving at the ratings, CRISIL has combined the business and
financial risk profiles of SFPL, SPL Fasteners Pvt Ltd and SPL
Forge. This is because these three companies, together referred to
as the Sunshine group, are in the same line of business, and have
a common management team, and operational and financial linkages.
Outlook: Stable
CRISIL believes that the Sunshine group will maintain its business
risk profile over the medium term, backed by its established
relationships with its customers and the extensive experience of
its promoters in the fastener industry. The outlook may be revised
to 'Positive' if the group improves its scale of operations while
maintaining its profitability leading to higher-than-expected cash
accruals and improves its working capital management. Conversely,
the outlook may be revised to 'Negative' if the Sunshine group's
revenues or operating margin declines, or its financial risk
profile deteriorates, most likely because of a stretch in its
working capital cycle or higher-than-expected, debt-funded capital
expenditure.
Incorporated in 2006, SFPL is promoted by Mr. Parsottambhai Patel
and his family members. The company manufactures stainless steel
fasteners, such as bolts, screws, nuts, washers, and screws. Its
manufacturing facility is in Wadhwan (Gujarat).
Incorporated in 2008, SPLFPL is promoted by Mr. Hirenbhai Patel
and his family members. The company trades in stainless steel and
high-tensile fasteners.
Incorporated in 2011, SPLF is promoted by Mr. Hirenbhai Patel and
his family members. The company manufactures high-tensile
fasteners, such as bolts, screws, nuts, washers, and screws. Its
manufacturing facility is in Gandhinagar (Gujarat). It started its
operations in 2012-13.
SFPL, on a standalone basis, reported a net profit of INR15.2
million on net sales of INR352.3 million for 2012-13 (refers to
financial year, April 1 to March 31), against a net profit of
INR9.8 million on net sales of INR381.4 million for 2011-12.
TRANSWORLD FURTICHEM: CRISIL Ups Ratings on INR550MM Loans to BB
----------------------------------------------------------------
CRISIL has upgraded its rating on the long-term bank facilities of
Transworld Furtichem Private Limited to 'CRISIL BB/Stable' from
'CRISIL BB-/Stable' and has reaffirmed its rating on the company's
short-term bank facilities at 'CRISIL A4+'.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 300 CRISIL BB/Stable (Upgraded
from CRISIL BB-/Stable)
Letter of Credit 550 CRISIL A4+ (Reaffirmed)
Proposed Long-Term
Bank Loan Facility 121 CRISIL BB/Stable (Upgraded
from CRISIL BB-/Stable)
Term Loan 129 CRISIL BB/Stable (Upgraded
from CRISIL BB-/Stable)
The upgrade reflects improvement in the operating performance and
liquidity profile of TFPL which is expected to be sustained over
the medium term. TFPL's revenues have increased to INR4.5 billion
in 2012-13 (refers to financial year, April 1 to March 31) from
INR 2.2 billion in 2011-12. The company has been able to record
such a significant improvement primarily on the back of higher
trading volumes driven by trading in products like rock phosphate
and di-ammonium phosphate. Steady profitability margins and lower
dependence on external borrowings have led to an improvement in
TFPL's debt protection metrics with net cash accruals to total
debt (NCATD) ratio at 0.41 times for 2012-13 against 0.17 times in
2011-12. TFPL's debt protection metrics are expected to remain at
the current levels over the medium term on the back of steady
profitability margins. The total outside liabilities to tangible
networth (TOLTNW) ration of the company is also healthy at 1.20
times as on March 31, 2013. The company's liquidity has also
improved, with sufficient cushion between net cash accruals and
term debt commitments. TFPL's net cash accruals are expected at
around INR154 million in 2013-14 vis-a-vis term debt obligations
of around INR93.5 million during the same period. The company does
not have any major capital expenditure plans over the medium term.
The ratings also reflect the benefits that TFPL derives from its
established market position and extensive experience of its
promoters in the fertilizer industry. These rating strengths are
partially offset by TFPL's modest profitability, sensitivity of
the company's profitability margins to volatility in prices of
fertilizers and exchange rate fluctuations. The ratings are
further constrained by its working capital intensive nature of
operations and customer concentration in its revenue profile.
Outlook: Stable
CRISIL believes that TFPL will benefit over the medium term from
company's established market position and promoter's extensive
experience in the fertilizer industry. The outlook may be revised
to 'Positive' if the company exhibits a significant and sustained
improvement in its profitability while diversifying its clientele
base and exhibiting steady growth in its revenues. Conversely, the
outlook may be revised to 'Negative' in case of a steep decline in
its revenues or profitability margins or an elongation of its
working capital cycle or larger than anticipated debt funded
capital expenditure resulting in a weakening in its financial risk
profile.
Incorporated in the year 2004, TFPL is primarily engaged in
manufacturing of compound NPK granulated fertilizers and other
products like potassium sulphate, sulphuric acid, oleum, etc. The
company also undertakes trading of agrochemicals and fertilizers.
In the year 2006, a Dubai based fertilizer company, 'Blue Deebaj
Chemicals LLC' had acquired a stake in TFPL. The day-to-day
operations of the company are managed by Mr. Dilip Gadiya.
TFPL reported a profit after tax (PAT) of INR147.1 million on net
sales of INR4.5 billion for 2012-13, against a PAT of INR 64.9
million on net sales of INR 2.3 billion in 2011-12.
UMALAXMI ORGANICS: CARE Reaffirms BB Rating on INR7.14cr Loans
--------------------------------------------------------------
CARE reaffirms the ratings assigned to the bank facilities of
Umalaxmi Organics Private Limited.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank 7.14 CARE BB Reaffirmed
Facilities
Short-term Bank 1.50 CARE A4 Reaffirmed
Facilities
Rating Rationale
The ratings of Umalaxmi Organics Private Limited continue to
remain constrained on account of its modest scale of operations,
fluctuating profitability margins and moderate liquidity position.
The ratings are further constrained due to nascent stage of
nutraceutical industry in India and vulnerability of margins to
fluctuations in raw material prices and foreign exchange rate.
The ratings, however, continue to derive comfort from experienced
management, its geographically diversified customer base and
moderately leveraged capital structure.
UOPL's ability to increase its scale of operations by stabilizing
operations while maintaining profitability margins and managing
the raw material sourcing and its pricing and are the key
rating sensitivities.
UOPL was incorporated during 2005 by Mr. Jeetesh Dave and Mr.
Rakesh Dave at Jodhpur, Rajasthan. UOPL is primarily engaged in
the business of processing, trading and export of nutraceutical
products/herbal extracts. The company has two plants in Rajasthan
located at Jodhpur and Sojat City and a marketing office in
Vadodara (Gujarat). UOPL also exports its products with major
export destinations being Europe, USA, South Africa, Russia and
Dubai. Its products are used directly or indirectly as dietary
supplements, functional beverages, sports nutrients and in
cosmetic industry.
The main raw materials used by UOPL are Organic Senna Leaves,
Garcinia & Boswellia, Lemon grass & peels, Psyllium husk and
Calcium Sennosides. Mr. Rakesh Dave (MBA in International
Marketing) looks after the international marketing functions
whereas Mr. Jeetesh Dave (MA in Economics) oversees the production
and technical aspects in UOPL.
In FY13 (refers to the period April 1 to March 31), UOPL reported
a total operating income of INR31.35 crore and PAT of INR1.61
crore as against a total operating income and PAT of INR27.62
crore and INR1.59 crore respectively in FY12.
VEDANTA CREATIONS: CRISIL Assigns 'BB+' Rating to INR50MM Loan
--------------------------------------------------------------
CRISIL has revoked the suspension of its ratings on the bank
facilities of Vedanta Creations Ltd (VCL; part of the Bang group)
and has assigned its 'CRISIL BB+/Stable/CRISIL A4+' ratings to
these facilities. CRISIL had suspended the ratings as per its
rating rationale dated November 30, 2012, because VCL had not
provided the necessary information for a rating review. VCL has
now shared the requisite information, enabling CRISIL to assign
ratings to the company's bank facilities.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 50 CRISIL BB+/Stable(Assigned;
Suspension Revoked)
Letter of Credit 50 CRISIL A4+ (Assigned;
Suspension Revoked)
The ratings reflect the Bang group's strong capital structure, and
the management's extensive experience in the fabric and readymade
garment business. These rating strengths are partially offset by
modest operating margins, exposure to risks related to foreign
exchange fluctuations, large working capital cycle, and
susceptibility to increasing competition in the fragmented
readymade garments industry.
For arriving at its ratings, CRISIL has combined the business and
financial risk profiles of Bang Overseas Ltd (BOL) and BOL's
wholly owned subsidiary, VCL, because of cash flow fungibility
between them. The consolidated entities are referred to as the
Bang group.
Outlook: Stable
CRISIL believes that the Bang group will continue to benefit from
its above-average capital structure supported by absence of any
debt-funded capital expenditure (capex) programmes and moderate
net worth. The outlook may be revised to 'Positive' if there is
significant and sustained improvement in its operating
profitability leading to healthy cash accruals and improvement in
its debt protection metrics, while maintaining current capital
structure. Conversely, the outlook may be revised to 'Negative' if
the group undertakes any large debt-funded capex or any large real
estate development adversely impacting its liquidity, any stretch
in working capital cycle or unanticipated bad debt or forex
losses.
BOL was promoted in 1992 as a private limited company by Mr.
Venugopal Bang and Mr. Brijgopal Bang. The company trades in
fabrics and manufactures readymade garments. It was reconstituted
as a public limited company in 2005 and also floated an initial
public offering (IPO) in January 2008. The company's manufacturing
facilities are located in Bengaluru (Karnataka). VCL, based in
Mumbai (Maharashtra), undertakes trading of premium cotton fabric.
On a standalone basis, BOL reported a profit after tax (PAT) of
INR10.15 million on operating income of INR2.36 billion for 2012-
13, as against a PAT of INR2.2 million on operating income of
INR1.37 billion for 2011-12. BOL reported, on provisional basis, a
net loss of INR17.67 million on revenues of INR326 million for the
three months ended June 30, 2013, as against a PAT of INR10.25
million on revenues of INR407 million for the corresponding period
of the previous year.
VCL, reported, on a provisional basis, a PAT of Rs2.6.million on
operating revenues of INR408.9 million for 2012-13; the company
reported a net loss of INR0.05 million on operating revenues of
INR313.9 million for 2011-12.
VIKRAM STRUCTURES: CRISIL Assigns 'D' Ratings to INR250MM Loans
---------------------------------------------------------------
CRISIL has assigned its 'CRISIL D' rating to the long-term bank
facilities of Vikram Structures Pvt Ltd. The rating reflects the
delays by the VSPL in servicing its debt; the delays have been
caused by the VSPL's weak liquidity.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Proposed Long-Term 94 CRISIL D (Assigned)
Bank Loan Facility
Long-Term Loan 106 CRISIL D (Assigned)
Overdraft Facility 50 CRISIL D (Assigned)
The ratings also factor in VSPL's exposure to risk related to
large project execution and to geographical concentration in its
revenue profile. However, VSPL benefits from its established track
record in the real estate market in Bengaluru (Karnataka).
Set up 2008 by Mr. Vikram Prabhakar, VSPL is engaged in real
estate development, in and around Bengaluru. Its day-to-day
operations are managed by Mr. Prabhakar, who serves as the
managing director.
VSPL reported, on a provisional basis, profit after tax (PAT) of
INR7.8 million on revenues of INR117.4 million for 2012-13 (refers
to financial year, April 1 to March 31), against a net profit of
INR3.5 million on net sales of INR31.7 million for 2011-12.
WESTERN SUITINGS: CARE Rates INR5.94cr LT Bank Loans at 'BB-'
-------------------------------------------------------------
CARE assigns 'CARE BB-' rating to the bank facilities of Western
Suitings Private Limited.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank 5.94 CARE BB- Assigned
Facilities
Rating Rationale
The rating assigned to the bank facilities of Western Suitings
Private Limited is primarily constrained on account of its
financial risk profile marked by low profitability margins,
moderate solvency position and weak liquidity position. The rating
is further constrained on account of its limited presence in the
textile value chain and vulnerability of margins to fluctuation in
raw material prices in the highly fragmented and competitive
textile industry.
The rating, however, derives strength from the experienced
management, its established marketing & distribution network and
its presence in the textile cluster of Bhilwara with easy access
of raw material and labour.
An improvement in the overall financial risk profile &
profitability and better working capital management will be the
key rating sensitivities.
WSPL was initially promoted by Mr Vinod Jain along with his
mother, Ms Kamla Jain in August 1987. However, in April 1991, WSPL
was acquired by Mr Lal Bahadur Ranka along with his brother, Mr
Tarun Ranka and commercial operations were commenced
simultaneously. WSPL is engaged in the business of manufacturing
of grey fabrics and also does trading of grey and finished
fabrics. The company outsources the processing work required for
the manufacturing of finished fabrics to the nearby process houses
located at Bhilwara. The plant of the company is located at
Bhilwara and has 50 sulzer looms with a total installed capacity
of 30 Lakh Meters Per Annum (LMPA). WSPL has utilized 100% of the
total installed capacity in FY13 (refers to the period April 1
to March 31).
During FY13, WSPL undertook a project for modernisation of its
plant through the installation of 12 new sulzer looms with new
technology and selling of its existing 16 sulzer looms of old
technology. WSPL has envisaged a total project cost of INR1.70
crore which is to be financed through promoter's capital of
INR0.15 crore, term loan of INR1.25 crore and remaining through
internal funds. The project is expected to be completed in July
2013. Till June 30, 2013, WSPL has incurred a total cost of
INR1.40 crore financed through promoter's capital of INR0.15
crore, term loan of INR1.10 crore and the remaining through
internal funds.
During FY12, WSPL reported a total income of INR17.30 crore with a
PAT of INR0.17 crore. As per the provisional result of FY13, the
company achieved a total operating income of INR17.66 crore.
YASHO INDUSTRIES: CRISIL Suspends 'BB+' Ratings on INR405MM Loans
-----------------------------------------------------------------
CRISIL has suspended its ratings on the bank facilities of Yasho
Industries Private Limited.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Bank Guarantee 5 CRISIL A4+ Suspended
Cash Credit 200 CRISIL BB+/Stable Suspended
Letter of Credit 120 CRISIL A4+ Suspended
Proposed Long-Term
Bank Loan Facility 4.2 CRISIL BB+/Stable Suspended
Rupee Term Loan 200.8 CRISIL BB+/Stable Suspended
The suspension of ratings is on account of non-cooperation by
Yasho with CRISIL's efforts to undertake a review of the ratings
outstanding. Despite repeated requests by CRISIL, Yasho is yet to
provide adequate information to enable CRISIL to assess Yasho's
ability to service its debt. The suspension reflects CRISIL's
inability to maintain a valid rating in the absence of adequate
information. CRISIL considers information availability risk as a
key credit factor in its rating process and non-sharing of
information as a first signal of possible credit distress, as
outlined in its criteria 'Information Availability Risk in Credit
Ratings'.
Yasho was set up by Mr. Vinod Harilal Jhaveri in 1992 as Vasu
Preservatives Pvt Ltd and commenced operations in 1993.
Subsequently, it was renamed Yasho in 1996. The company
manufactures and sells chemicals such as antioxidants used in
foods, rubber chemicals, aroma chemicals, and specialty chemicals.
Recently, the company commenced manufacturing lubes chemical. The
company is managed by the sons of Mr. Vinod H Jhaveri: Mr. Parag V
Jhaveri, Mr. Nilesh V Jhaveri, and Mr. Yayesh V Jhaveri.
=================
I N D O N E S I A
=================
METROPOLIS PROPERTINDO: S&P Assigns 'B+' CCR; Outlook Stable
------------------------------------------------------------
Standard & Poor's Ratings Services said that it had assigned its
'B+' long-term corporate credit rating to Indonesia-based property
developer PT Metropolis Propertindo Utama (MPU). The outlook is
stable. S&P also assigned its 'axBB' long-term ASEAN regional
scale rating to MPU.
At the same time Standard & Poor's assigned its 'B+' long-term
issue rating to a proposed issue of senior secured notes by
Khatulistiwa Development Pte. Ltd. MPU guarantees the notes. The
issue rating is subject to S&P's review of the final issuance
documentation.
"The rating on MPU reflects our view that the company's cash flows
are volatile and uneven, it has significant capital expenditure
needs for the acquisition and construction of projects, its cash-
conversion cycle is long, and it has a large exposure to a single
customer group," said Standard & Poor's credit analyst Kah Ling
Chan. "MPU's diversified exposure across many different asset
types, its geographical spread across Indonesia, and its close
relationship with the largest property developer in Indonesia and
its listed REITs temper these weaknesses."
S&P assess MPU's business risk profile as "weak" and its financial
risk profile as "aggressive."
MPU's cash flows are volatile and its funding needs are higher
than peers' because its build-and-sell model is capital intensive.
The company funds its own projects, and its holding period is
uncertain. MPU realizes cash proceeds only when the projects are
completed and sold.
S&P believeS MPU's close business relationship with PT Lippo
Karawaci Tbk. exposes it to the credit risk of Lippo. The
stronger credit profile of Lippo and its good funding capability
temper this risk.
S&P expectS MPU's growth appetite to remain strong over the next
three to five years as the company matches the aggressive
expansion plans of the Lippo group.
MPU's recurring income is likely to improve over the next two to
three years because of completion of new assets but remain less
than 10% of total revenue. However, it will be insufficient to
mitigate any shortfall in divestment sales.
S&P's rating also factors in privately owned MPU's short record of
consistently managing its financial performance. S&P expects that
the company will continue to disclose information in a
satisfactory and timely manner.
S&P do not notch down the issue rating because the legal system in
Indonesia is characterized by a general lack of transparency and
inconsistent enforcement.
"The stable outlook reflects our expectation that MPU will
continue its close business relationship with the Lippo group and
execute its build-and-sell model over the next 12 months," said
Ms. Chan. "We anticipate that the company will generate
satisfactory divestment sales and margins, increase its leasing
income, and maintain EBITDA interest coverage of 2.5x-3.0x in 2014
despite higher leverage."
S&P also expects MPU to maintain prudent financial management and
significant surplus cash for contingencies while pursuing
expansion.
S&P may lower the rating if: (1) MPU deviates from its core
business and strategy, makes debt-funded acquisitions that are
larger than its expectations, or has substantially lower
divestment sales in 2014 than its estimate; or (2) the Indonesian
property market weakens significantly. A downgrade trigger could
be EBITDA interest coverage of less than 2x on a sustained basis.
S&P could also downgrade MPU if Lippo's credit profile
deteriorates significantly or if the timeliness and quality of
MPU's information disclosure fall below the standards that S&P
expects for public companies.
The potential upside to the rating is limited over the next 12
months because of MPU's significant exposure to the Lippo group.
S&P may raise the rating if MPU: (1) diversifies its customer
base, expands its scale, or improves its business diversity to
increase its recurring leasing income; and (2) demonstrates a
consistent record of information disclosure, operational
performance, and disciplined financial management.
====================
N E W Z E A L A N D
====================
TACHIKAWA FOREST: NZ$5 Million Could Rescue Sawmill, MP Says
------------------------------------------------------------
news.msn.co.nz reports that member of Parliament Brendan Horan
said he has an independent report which shows NZ$5 million of
working capital would have kept Rotorua sawmill, which is in
receivership, in business, and he thinks it can still be done.
Tachikawa Forest Products (NZ) is the owner of the Rotorua
sawmill.
"The sawmill is silent, 120 people are out of work, and the
government is looking at a negative economic impact of at least
NZ$8.5 million a year," the report quoted the independent MP as
saying. "It had a strong forward order book, it is a viable going
concern," Mr. Horan said, the report notes.
Mr. Horan said he'll be meeting cabinet minister Todd McClay, who
is MP for Rotorua, and sawmill workers, the report notes.
"The government should do the maths -- the working capital needed
will be recouped in just seven months as economic activity
continues with a working sawmill," Mr. Horan said, the report
adds.
Tachikawa Forest Products (NZ) Ltd was a Rotorua, New Zealand-
based sawmill operator.
Brendon James Gibson -- bgibson@kordamentha.com -- and Grant
Robert Graham -- ggraham@kordamentha.com -- of KordaMentha were
appointed Joint and Several Receivers and Managers of the assets
and undertaking of the Company on Oct. 18, 2013.
*********
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, Julie Anne L. Toledo, 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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