/raid1/www/Hosts/bankrupt/TCRAP_Public/140106.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
A S I A P A C I F I C
Monday, January 6, 2014, Vol. 17, No. 3
Headlines
A U S T R A L I A
WASABI ENERGY: Ferrier Hodgson Appointed as Administrators
C H I N A
HILONG HOLDING: Barge Acquisition No Impact on Moody's Ba2 CFR
* China's Banks Adopt 'Living Wills' to Plan for Less Predictable
I N D I A
A.M. PATEL: CARE Assigns 'D' Ratings to INR9.4cr LT Bank Loans
A-ONE FOOTARTS: CRISIL Assigns 'B+' Ratings to INR38MM Loans
AAKASH POLYFILMS: CRISIL Assigns 'B+' Ratings to INR162MM Loans
ALLIED ICD: CARE Assigns 'D' Ratings to INR9.17cr Loans
ARIHANT POLYSACKS: ICRA Assigns 'B+' Ratings to INR6.25cr Loans
ASA PORTFOLIO: CRISIL Rates INR50MM Cash Credit at 'B'
BATANAGAR EDUCATION: CRISIL Cuts Rating on INR110MM Loan to 'B-'
BHUJBAL BROTHERS: CRISIL Puts 'D' Rating to INR90MM LT Loan
BISHNUPRIYA COLD: CARE Assigns 'B' Rating to INR4.91cr Loans
CITY ROLLING: CARE Assigns 'B+' Rating to INR10cr LT Bank Loans
CONVEYOR & ROPEWAY: CRISIL Ups Ratings on INR60.9MM Loans to 'B+'
DEO MANGAL: CRISIL Assigns 'B-' Ratings to INR230M Loans
DMW CNC: CRISIL Assigns 'B-' Ratings to INR143.4MM Loans
DURAIRAJ MILLS: ICRA Assigns 'D' Ratings to INR60MM Loans
EISHA ATHARVA: CRISIL Rates INR150MM Long-Term Loan at 'B'
EVEREST STARCH: CRISIL Assigns 'B+' Ratings to INR400MM Loans
GOPAL MASTERBATCH: CRISIL Assigns 'B+' Ratings to INR100MM Loans
GUINEA MOTORS: CARE Rates INR16.37cr LT Bank Loans at 'B'
HINDUSTAN MOTORS: C K Birla Steps Down as Chairman
JAY FORMULATIONS: CRISIL Raises Ratings on INR35MM Loans to 'B'
KAILASH GINNING: CRISIL Reaffirms 'B' Ratings on INR120MM Loans
KC INDUSTRIES: CRISIL Assigns 'B+' Rating to INR110MM Loan
KHANDOGOSH AGRO: CARE Assigns 'B+' Rating to INR4.73cr LT Loans
KINGFISHER AIRLINES: Workers to Seek Kejriwal's Help to Get Dues
KOHINOOR HATCHERIES: CRISIL Places 'B-' Ratings on INR642MM Loans
KRISHNA GINNING: ICRA Assigns 'B' Ratings to INR6.8cr Loans
MUNISH FORGE: CRISIL Reaffirms 'B+' Ratings on INR278MM Loans
MUNISH INT'L: CRISIL Reaffirms 'B+' Ratings on INR85.3MM Loans
NIRALA RICE: CRISIL Assigns 'B+' Ratings to INR59MM Loans
NOBLE INDUSTRIES: ICRA Assigns 'C' Ratings to INR16cr Loans
OMSHREE RUBBER: CRISIL Reaffirms 'D' Ratings on INR61.2MM Loans
OPS JEWELLS: CRISIL Rates INR150MM Cash Credit at 'B+'
POLYPLASTICS IND: CRISIL Reaffirms 'B' Rating on INR568.3M Loan
POLYPLASTICS UTTAR: CRISIL Reaffirms 'B' Ratings on INR88.9M Loan
RAJCHANDRA AGENCIES: CRISIL Rates INR52.5MM Loan at 'B'
S.R INDUSTRIES: CRISIL Reaffirms 'D' Ratings on INR374.5MM Loans
SATIA SYNTHETICS: CARE Raises Rating on INR100.92cr Loans t 'B-'
SHELAR PROPERTIES: CRISIL Reaffirms 'D' Ratings on INR150MM Loans
SHREE JAYSUNDAR: CRISIL Assigns 'D' Ratings to INR90MM Loans
SHRI PRABHULINGESHWAR: ICRA Cuts Ratings on INR100MM Loans to 'D'
SILVER GLOBAL: CRISIL Assigns 'D' Ratings to INR80MM Loans
ST. NICHOLAS: CRISIL Assigns 'B' Ratings to INR60MM Loans
SUNARK ALUMINIUM: ICRA Ups Rating on INR4.26cr Loan to 'C-'
SURESOFT SYSTEMS: CRISIL Puts 'B' Ratings on INR130MM Loans
VEDANTA RESOURCES: Mining Restart No Impact on Moody's Ba1 CFR
VGN HOMES: CRISIL Raises Ratings on INR1.75BB Loans to 'B'
P H I L I P P I N E S
TRI-M TECHNOLOGIES: In Voluntary Liquidation, Dissolved
S O U T H K O R E A
SSANGYONG ENG'G: Awaits Appointment of Debt Rescheduling Admin.
X X X X X X X X
* Bond Risk Increases in Asia-Pacific, Default Swaps Show
- - - - -
=================
A U S T R A L I A
=================
WASABI ENERGY: Ferrier Hodgson Appointed as Administrators
----------------------------------------------------------
Stewart McCallum -- stewart.mccallum@fh.com.au -- and
John Lindholm -- john.lindholm@fh.com.au -- of Ferrier Hodgson
were appointed voluntary administrators of Wasabi Energy Limited
on Dec. 30, 2013, pursuant to Section 436A of the Corporations Act
2001.
"The Administrators now control the Company's trading and are
assessing the Company's financial position," Ferrier Hodgson said
in a statement.
The first meeting of creditors will be held on Jan. 10, 2014, at
10:00 a.m. (AEDT) at the offices of Ferrier Hodgson, Level 43, 600
Bourke Street, in Melbourne VIC 3000.
Alliance News notes that Wasabi's shares were suspended on
December 23 after it failed to raise enough funds to pay off AU$8
million of outstanding loan notes, or to fund its purchase of the
Tuzla Geothermal Power Project in Turkey.
On November 27, Wasabi said it wanted to raise up to US$14.8
million through a rights issue to complete the purchase of the
Tuzla Project, as well as pay off its debt and provide working
capital, Alliance News discloses.
Alliance News relays that Wasabi said on December 24, the
shortfall on its rights issue totaled AUD13.8 million, managing to
raise only AUD1.0 million, or 6.5% of the company's shares on
offer, and that it was holding discussions with note holders about
how to repay the notes.
Wasabi Energy Limited (ASX:WAS) -- http://www.wasabienergy.com/--
- is engaged in the management of its projects and investments.
The Company operates in two segments: Investments and Geothermal
Power. The Investment segment provides administration support and
is responsible for the investment activities of the Company. The
Geothermal segment located in the US and UK manages the geo
thermal power activities of the Company.
=========
C H I N A
=========
HILONG HOLDING: Barge Acquisition No Impact on Moody's Ba2 CFR
--------------------------------------------------------------
Moody's Investors Service says Hilong Holding Limited's purchase
of a pipe-lay barge is credit negative, but its Ba2 corporate
family rating and stable rating outlook are not immediately
affected.
On December 31 2013, Hilong announced that it had entered into an
agreement to purchase the new pipe-lay barge from Shanghai Zhenhua
Heavy Industries Co., Ltd. (unrated) for USD163.6 million
(RMB998.4 million), representing approximately 23.5% of the
company's total assets as of June 2013.
The company will fund the acquisition by both internal reserves
and debt.
Moody's estimates that Hilong had RMB500-600 million of cash on
hand and USD200 million (RMB1.2 billion) of undrawn offshore
banking facilities at end-2013.
The barge has a pipe-lay capacity of 8-300 meters underwater and
is able to lay pipes with a diameter of 6-60 inches, including the
coating layer. The purchase marks Hilong's venture into offshore
oilfield services.
"The transaction is credit negative for Hilong because the company
has made the investment upfront without securing any employment
contracts with oil companies. The company also does not have a
track record in offshore oilfield services," says Kaven Tsang, a
Moody's Vice President and Senior Analyst.
Despite this assessment, Moody's considers the execution risks as
manageable.
Hilong's expansion into offshore oilfield services is consistent
with its business strategy.
Hilong has been expanding in land-based oilfield services business
over the last 3 years. It has established a track record in this
business. As a result, it can obtain repeat service contracts from
large oil companies such as Royal Dutch Shell plc (Aa1 stable).
While it has yet to secure any offshore oilfield service
contracts, it is in discussion with potential customers.
The company's good relationships with the domestic oil giants -
such as China National Petroleum Corporation (Aa3 stable), China
Petroleum and Chemical Corporation (Aa3 stable), and China
National Offshore Oil Corporation (Aa3 stable) -- strengthen its
abilities to secure offshore oilfield service contracts in the
future.
The execution risk is also partly mitigated by the fact that the
company has recruited a crew with experience to operate the barge.
"The transaction will also raise the company's leverage and
financial risks, given its sizable scale and that it is mainly
funded by debt," adds Tsang, also Moody's lead analyst for Hilong.
Nevertheless, its projected adjusted debt/EBITDA and
EBITDA/interest will stay at around 3.0x-3.5x and around 6x in the
next 1-2 years. These metrics continue to support its Ba2
corporate family rating.
The principal methodology used in this rating was the Global
Oilfield Services Rating Methodology published in December 2009.
Please see the Credit Policy page on www.moodys.com for a copy of
this methodology.
Established in 2001, Hilong Holding Limited is an integrated
oilfield equipment and services provider. It has three main
businesses: drill pipes and related products; coating materials
and services; and oilfield services. Mr. Jun Zhang, the Chairman
and founder, is the controlling shareholder, with a 59.97% equity
interest in the company as of June 30 2013.
* China's Banks Adopt 'Living Wills' to Plan for Less Predictable
-----------------------------------------------------------------
Grace Zhu, writing for The Wall Street Journal, reported that
China's banks are starting to look to the hereafter.
According to the report, China Merchants Bank Co., the country's
sixth-largest lender by assets, took a page from its Western
counterparts and drafted a so-called "living will." It didn't have
much to say about the contents, but in a filing to the Shanghai
exchange it said the bank's board had approved management's
proposal.
Earlier in December, Bank of China said its board approved a
resolution plan, while Industrial & Commercial Bank of China has
said it expects to make similar plans, the report related.
The idea of a living will, sometimes likened to a near-death
patient preparing for the inevitable, is to provide a resolution
plan to help regulators wind up a failing bank -- or bring it back
to healthy operation, the report said. Reacting to the shocks of
the global financial crisis, the G-20 Financial Stability Board,
which has coordinated a multinational effort, agreed in 2010 to
push banks to create living wills. The concept was also endorsed
in the 2010 Dodd-Frank financial law in the U.S.
The living will proposals come at an appropriate time for China,
as the nation begins to address the prospect of bank failures, the
report further related. Its government-dominated banking sector
is seen as having implicit state support. But Beijing wants to
bring private capital to the sector and that could mean new risks.
While China wants fresh competitors to shake up its banking
system, it doesn't want to be on the hook for management mistakes.
=========
I N D I A
=========
A.M. PATEL: CARE Assigns 'D' Ratings to INR9.4cr LT Bank Loans
--------------------------------------------------------------
CARE assigns 'CARE D' rating to the bank facilities of A.M. Patel
Infra Private Limited.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank 9.40 CARE D Assigned
Facilities
Rating Rationale
The rating assigned to the bank facilities of A.M. Patel Infra
Private Limited factors in the frequent instances of delays in
debt servicing due to its stressed liquidity position.
A.M. Patel Infra Private Limited, incorporated in 2009, is engaged
in the construction of residential properties. MrBhavenBhaskarbhai
Amin, founder of AMPL, has been in the business of real estate
since the last eight years. AMPL, in the past, has completed one
project namely '30 Greens' in Aurangabad with a total saleable
area of 2.25 lakh square feet (lsf). The company is currently
executing two residential projects with a total saleable area of
3.05 lsf. The residential project namely '50 Greens'with a
saleable area of 1.31 lsf, comprises of 50 bungalows and another
residential project namely '108 Greens'with a total saleable area
of 1.74 lsf, comprises of 108 flats of 3bhk.
As per FY13 (provisional) refers to the period April 1 to
March 31) results, AMPL has registered a PAT of INR0.21 crore as
against the total income of INR5.91 crore.
A-ONE FOOTARTS: CRISIL Assigns 'B+' Ratings to INR38MM Loans
------------------------------------------------------------
CRISIL has assigned its 'CRISIL B+/Stable/CRISIL A4' ratings to
the bank facilities of A-One Footarts Private Limited.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Term Loan 18 CRISIL B+/Stable
Cash Credit 20 CRISIL B+/Stable
Foreign Letter of
Credit 26 CRISIL A4
The ratings reflect AFPL's average financial risk profile marked
by high gearing and moderate debt protection metrics; high working
capital requirements & small scale of operations. These rating
weaknesses are partially offset by the benefits that company
derives from its promoters' extensive experience in the footwear
industry.
Outlook: Stable
CRISIL believes A-One Footarts Private Limited will maintain a
stable business risk profile on the back of its promoters'
extensive industry experience. The outlook may be revised to
'Positive' if AFPL's scale of operations or margins increases
significantly resulting in improvement in its financial risk
profile. Conversely, the outlook may be revised to 'Negative' if
case of significant decline in revenue growth or margins, or
undertakes large, debt-funded capital expenditure (capex).
AFPL was set up in 2011 by Mr. Ravi Kumar and his family members
in Alwar, Rajasthan. It is engaged in manufacturing and marketing
of footwear. Company sells and markets its products under its
brand 'Indus' which is a registered trademark.
AAKASH POLYFILMS: CRISIL Assigns 'B+' Ratings to INR162MM Loans
---------------------------------------------------------------
CRISIL has assigned its 'CRISIL B+/Stable/CRISIL A4' ratings to
the bank facilities of Aakash Polyfilms Ltd.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Term Loan 98 CRISIL B+/Stable
Cash Credit 64 CRISIL B+/Stable
Letter of Credit 40 CRISIL A4
The ratings reflect APL's small scale of operations and the
susceptibility of its profitability margins to volatility in
realisations and in raw material prices. These rating weaknesses
are partially offset by the extensive experience of APL's
promoters in the packaging industry, the continued funding support
it receives from them, and its comfortable capital structure.
Outlook: Stable
CRISIL believes that APL will continue to benefit over the medium
term from its promoters' extensive experience in the flexible
packaging industry. The outlook may be revised to 'Positive' if
the company significantly scales up its operations and sustains
the improvement in its profitability, backed by timely
stabilisation of its ongoing backward integration plan.
Conversely, the outlook may be revised to 'Negative' if APL's cash
accruals are lower than expected or if its financial risk profile
deteriorates, either because of larger-than-expected, debt-funded
capital expenditure or significant increase in its working capital
requirements.
Incorporated in 1994, APL, a Surat (Gujarat)-based company, is
promoted by the Tulsiani family. APL is engaged in the
manufacturing and processing of metalized and holographic films.
For 2012-13 (refers to financial year, April 1 to March 31), APL
reported a net loss of INR3.0 million on net sales of INR280
million, against a net loss of INR2.8 million on net sales of
INR242 million for 2011-12.
ALLIED ICD: CARE Assigns 'D' Ratings to INR9.17cr Loans
-------------------------------------------------------
CARE assigns 'CARE D' rating to the bank facilities of Allied ICD
Services Limited.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank
Facilities 8.49 CARE D Assigned
Short-term Bank
Facilities 0.68 CARE D Assigned
Rating Rationale
The rating of Allied ICD Services Limited factors in the on-going
delays in debt servicing on account of the stretched liquidity
position of the company.
Kolkata-based (West Bengal) Allied ICD Services Limited (AISL) was
incorporated in September 1997 in the name of Reforms Exim
Limited, by MrPramod Kumar Srivastava along with his wife
MsRupa Srivastava. The company remained dormant for eight years.
In December 2004, the name of the company has changed to the
current one and AISL started its operation since 2005. It offers
services like transportation of export & import containers and
various other equipments, warehousing, cargo handling and custom
clearance services to exporters and importers. The company
operates through a fleet of 100 trailers. Currently, about 52% of
the business is generated through own fleet of vehicles and for
the balance, the company resorts to hired vehicles.
AISL's, warehouse located in Durgapur, is the first operational
dry port in Eastern India and has a strong presence in the
container handling activities at Kolkata &Haldia port having its
own reach stacker container handlers, forklifts, cranes and
excavators for smooth and efficient handling of containerised
cargo.
During FY13 (refers to the period April 1 to March 31), the
company reported a PBILDT of INR5.8crore (INR4.7crore in FY12) and
a PAT of INR1.9 crore (of INR0.4 crore in FY12) on a total
income of INR22.4 crore (INR19.5 crore in FY12).Furthermore, the
management has maintained that the company has achieved a turnover
of INR2.18 crore during 5MFY14.
ARIHANT POLYSACKS: ICRA Assigns 'B+' Ratings to INR6.25cr Loans
---------------------------------------------------------------
The rating of '[ICRA]B+' has been assigned to the INR2.25 crore of
term loan and INR4.00 crore of fund-based cash credit facility of
Arihant Polysacks.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Fund 4.00 [ICRA]B+ Assigned
Based Limits-
Cash Credit
Long Term Fund 2.25 [ICRA]B+ Assigned
Based Limits-
Term Loan
The rating are constrained by Arihant Polysack's small scale of
operation in the woven sack business segment and weak financial
risk profile as reflected in stretched liquidity position due to
working capital intensity in the business. The ratings also take
into account of high competition in the woven sacks industry with
low entry barriers and limited product differentiation which, in
turn, results in modest margins and susceptibility of
profitability to fluctuations in polymer prices. ICRA also takes
note of the firm's ongoing debt funded capex which is expected to
keep the capital structure at high level in the near term. Also,
net worth of firm remains exposed to risk of capital withdrawal as
the firm is a partnership concern.
The ratings, however, favourably factor in the established track
record of the promoters in the poly-woven sacks industry and
steady medium to long-term demand prospects from end user sectors
namely cement and fertilizers.
Arihant Polysacks was established in the year 2004 as a
partnership concern with Mr. Suneet Kumar Jain (42%), Mr. Pawan
Jain (32%), Mrs. Sanjana (8%) and Mr. Ganesh (18%) as partners.
The firm undertakes manufacturing of Polyproplene (PP) and High
density poly ethylene (HDPE) woven fabrics and sacks. The current
manufacturing capacity for the firm stood at 1500 metric tonn of
which it utilises 75%. The unit has its head office and
manufacturing unit located in Piparia, Silvassa (Union Territory
of Dadar and Nagar Haveli).
Recent Results
During 2012-13, the firm has reported a profit after tax (PAT) of
INR0.37 crore on an operating income of INR13.64 crore and an
operating profit before tax of Rs 0.29 crore on an operating
income of INR7.81 crore for the six months ending September 30,
2013.
ASA PORTFOLIO: CRISIL Rates INR50MM Cash Credit at 'B'
------------------------------------------------------
CRISIL has assigned its 'CRISIL B/Stable' rating to the long-term
bank facility of ASA Portfolio Pvt Ltd.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 50 CRISIL B/Stable
The rating reflects APPL's small scale and working-capital-
intensive nature of operations. The rating also reflects pressure
on liquidity on account of significant loans and advances made to
group companies under the same management. These weaknesses are
partially offset by established relationship with its clients and
balanced approach towards risk management.
Outlook: Stable
CRISIL believes that APPL's business risk profile will continue to
benefit from the established relationship with its customers. The
outlook may be revised to 'Positive' in case of a significant
increase in scale of operations leading to better accruals, along
with improvement in operating margin. Conversely, the outlook may
be revised to 'Negative' in case of a decline in APPL's revenues
and operating margin, or advancement of additional loans to group
companies leading to deterioration in the company's financial risk
profile.
APPL was incorporated in May, 2010. The company is promoted by Mr.
Sushil Chaudhary and Mr. Akash Malik. Mr. Chaudhary is the major
shareholder of the company. The company is majorly involved in the
trading of gypsum.
For 2012-13 (refers to financial year, April 1 to March 31), APPL
reported a profit after tax (PAT) of INR8.70 million on net sales
of INR409 million.
BATANAGAR EDUCATION: CRISIL Cuts Rating on INR110MM Loan to 'B-'
----------------------------------------------------------------
CRISIL has downgraded its rating on the long-term bank facility of
Batanagar Education and Research Trust to 'CRISIL B-/Stable' from
'CRISIL B/Stable'.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Term Loan 110 CRISIL B-/Stable (Downgraded
from 'CRISIL B /Stable')
The rating downgrade reflects BERT's weak liquidity, as reflected
in its tightly matched cash accruals with its high debt repayment
obligations, which will commence from March 2014. BERT reported a
low operating income of INR9.3 million in 2012-13 (refers to
financial year, April 1 to March 31) because of low intake of
students under the management quota, and as this was its initial
year of operations. The trust has formed a tie-up with Techno
India Group (TIG) which is likely to help it meet its term debt
repayment obligations and any further capital expenditure plans
The rating also reflects the low surpluses expected over the
initial years of BERT's operations, constraining its financial
flexibility. These rating weaknesses are partially offset by the
support that the trust receives from its trustees and from its
newly formed tie-up with TIG, and benefits expected from the
strong demand prospects for education in India.
Outlook: Stable
CRISIL believes that BERT's credit risk profile is likely to
benefit over the medium term from the experience of its trustees
and from its newly formed tie-up with TIG. The outlook may be
revised to 'Positive' if the trust reports a higher-than-expected
surplus, leading to substantial cash accruals, or if it receives
adequate and timely support from its trustees. Conversely, the
outlook may be revised to 'Negative' if BERT does not receive
adequate and timely support from its trustees, leading to further
weakening of its liquidity.
BERT was set up as a public charitable trust and registered in
February 2007 as a non-profit trust. The trust has set up an
engineering college, Batanagar Institute of Engineering Management
and Science, at Maheshtala in Kolkata (West Bengal).
BHUJBAL BROTHERS: CRISIL Puts 'D' Rating to INR90MM LT Loan
-----------------------------------------------------------
CRISIL has assigned its 'CRISIL D' rating to the long-term bank
facility of Bhujbal Brothers Construction Co.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Long-Term Loan 90 CRISIL D
The ratings reflect instances of delay by Bhujbal in servicing its
term debt; the delays have been caused by the firm's weak
liquidity because of low bookings for its ongoing real estate
project and the resultant low advances from customers.
Bhujbal is exposed to project implementation risks and to
cyclicality in the real estate industry in India. However, the
firm benefits from the extensive industry experience of its
promoters.
Established in 1970, Bhujbal is engaged in residential real estate
development, mainly in Pune (Maharashtra). The firm is promoted by
Mr. Ramesh Bhujbal and his family members.
BISHNUPRIYA COLD: CARE Assigns 'B' Rating to INR4.91cr Loans
------------------------------------------------------------
CARE assigns 'CARE B' and 'CARE A4' ratings to the bank facilities
of Bishnupriya Cold Storage Pvt Ltd.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank
Facilities 4.91 CARE B Assigned
Short-term Bank
Facilities 2.54 CARE A4 Assigned
Rating Rationale
The ratings assigned to the bank facilities of Bishnupriya Cold
Storage Private Ltd are constrained by its nascent stage of
operations, regulated nature of the business, seasonality of
business with susceptibility to the vagaries of nature, risk of
delinquency in loans extended to farmers, competition from other
local players, weak financial risk profile marked by the small
scale of operations with thin profitability, leveraged capital
structure and weak liquidity indicators. The rating constraints
are partially offset by the satisfactory experience of the
promoters and its proximity to the potato growing areas.
The ability to increase its scale of operations with an
improvement in profitability and effective management of working
capital would be the key rating sensitivities.
BCSPL was incorporated on August 4, 2010 for setting up a cold
storage facility by two brothers: MrSomenathMontri and
MrSantinathMontri of PaschimMedinipur, West Bengal. The commercial
operation of the company has started on April, 2012. Currently,
BCSPL is engaged in the business of providing cold storage
facility primarily for potatoes to local farmers and traders on a
rental basis with an aggregate storage capacity of 140,000 packets
per annum. The cold storage is located at PaschimMedinipur
district of West Bengal. Besides providing cold storage facility,
the company also provides interest bearing advances to farmers for
potato farming purposes against potato stored. It is also engaged
in the potato trading business which accounts for about 51.61% of
the total income during FY13 (refers to the period April 1 to
March 31).
During FY13, the company reported a PBILDT of INR1.41 crore and a
PAT of INR0.03 crore on a total income of INR3.72 crore.
CITY ROLLING: CARE Assigns 'B+' Rating to INR10cr LT Bank Loans
---------------------------------------------------------------
CARE assigns 'CARE B+' rating to the bank facilities of City
Rolling Mills Private Limited.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank 10 CARE B+ Assigned
Facilities
Rating Rationale
The rating assigned to the bank facilities of City Rolling Mills
Private Limited is constrained by the small player with a short
track record of operation coupled with the geographical
concentration risk, lack of backward integration vis-…-vis
volatility in raw material prices, stiff competition due to
fragmented nature of the industry with the presence of many
unorganized players, cyclicality in the steel industry and working
capital intensive nature of operations. The aforesaid constraints
are partially offset by the experience of the promoter and
strategic location of the plant.
The ability to increase the scale of operations and profitability
margins and ability to manage working capital effectively are the
key rating sensitivities.
City Rolling Mills Private Limited, incorporated in January, 2010
was promoted by Mr Kishore Sharma and Mr Tarun Kr Gupta of Patna,
Bihar. The company commenced operations in January, 2013. CRMPL is
engaged in the manufacturing of TMT bars and end cutting at its
plant located at Bihta, Patna with a current installed capacity of
30,000 metric tonne per annum (MTPA). The products of CRMPL find
applications in different sectors which include construction and
infrastructure.
As per the audited results of FY13 (refers to the period April 01
to March 31), CRMPL reported a PBILDT of INR0.38 crore and a PAT
INR0.02crore, on a total income of INR17 crore. Furthermore,
during H1FY14, the management has stated to have achieved a
revenue of INR33.07 crore.
CONVEYOR & ROPEWAY: CRISIL Ups Ratings on INR60.9MM Loans to 'B+'
-----------------------------------------------------------------
CRISIL has upgraded its ratings on the long-term bank facilities
of Conveyor & Ropeway Services Pvt Ltd to 'CRISIL B+/Stable' from
'CRISIL B/Stable', while reaffirming the rating on short-term
facilities at 'CRISIL A4'.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Bank Guarantee 30 CRISIL A4 (Reaffirmed)
Letter of Credit 4 CRISIL A4 (Reaffirmed)
Cash Credit 10 CRISIL B+/Stable (Upgraded
from 'CRISIL B/Stable')
Long-Term Loan 49.4 CRISIL B+/Stable (Upgraded
from 'CRISIL B/Stable')
Standby Line of Credit 1.5 CRISIL B+/Stable (Upgraded
from 'CRISIL B/Stable')
The upgrade is on account of improvement in the CRSPL's business
risk profile, following the increase in revenue in 2012-13 (refers
to financial year, April 1-March 31), and the expectation that the
scale will be retained in the near-term. CRSPL's revenue
visibility for the next 1-2 years is moderate, given the company's
current order book, and the revenue stream from its Build-Operate-
Transfer (BOT) projects. The company's profitability is also
expected to remain at current levels in the next 2-3 years.
The improvement in scale has also led to increase in the accruals
generated; which is expected to support liquidity over the medium
term. However given that the repayments on its Tsomgo (Sikkim)
project loan will commence from April 2014, the timely completion
of the project will be critical for the company's liquidity
profile; and it remains a key rating sensitivity factor.
The ratings continue to be constrained on account of the company's
modest net worth and high gearing; and scale of operations, which
is modest despite the growth in 2012-13. The rating weaknesses are
partially offset by the company's established track record in the
aerial ropeways segment and moderate revenue visibility.
Outlook: Stable
CRISIL believes that CRSPL will maintain its credit profile on the
back of the promoters' extensive experience in the sector, and
moderate revenue visibility enjoyed by the company currently. The
outlook may be revised to 'Positive' if CRSPL significantly
improves its scale of operations, while sustaining its
profitability, or if there is a marked improvement in the
financial risk profile, most likely through equity infusion by
promoters. Conversely, the outlook may be revised to 'Negative' if
the company's revenue decline sharply, or if significant decline
in profitability or a large debt-funded capital expenditure
(capex) lead to further weakening in its financial risk profile.
CRSPL designs, manufactures, erects, and commissions aerial
ropeway systems, material handling plants, and coal washing
plants, besides undertaking techno-feasibility studies for ropeway
systems.
CRSPL reported a profit after tax (PAT) of INR4.9 million on net
revenue of INR188.4 million for 2012-13, as against a PAT of
INR5.8 million on net revenue of INR41.7 million for 2011-12.
DEO MANGAL: CRISIL Assigns 'B-' Ratings to INR230M Loans
--------------------------------------------------------
CRISIL has assigned its 'CRISIL B-/Stable' rating to the long-term
bank facilities of Deo Mangal Memorial Trust.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Term Loan 150 CRISIL B-/Stable
Overdraft Facility 15 CRISIL B-/Stable
Proposed Long-Term
Bank Loan Facility 65 CRISIL B-/Stable
The rating reflects DMMT's weak liquidity resulting from its cash
accruals being mainly deployed towards continuous investment in
capital expenditure and large term debt repayments. The rating
also factors the trust's modest scale of operations and
susceptibility to risks associated with obtaining annual
regulatory approvals for operating its medical college. These
rating weaknesses are partially offset by the extensive experience
of DMMT's trustees in the education sector and the funding support
it receives from them.
Outlook: Stable
CRISIL believes that DMMT's liquidity will remain constrained over
the medium term due to its large term debt repayment obligations.
The outlook may be revised to 'Positive' in case of improvement in
the trust's financial risk profile, particularly its liquidity,
most likely due to higher-than-expected cash accruals and timely
receipt of admission fees. Conversely, the outlook may be revised
to 'Negative' in case of deterioration in the trust's liquidity
due to lower-than-anticipated cash accruals, or delays in receipt
of admission fees, or lower-than-expected funding support from its
trustees.
Established in 2000, DMMT is an educational trust offering medical
education and medical services. The trust owns Narayan Medical
College and Hospital (NMCH) in Jamuhar village, Rohtas district
(Bihar). NMCH operates a 550-bed multi-specialty hospital and 100-
seat medical college offering a bachelor degree in medicine. It is
affiliated to the Vir Kunvar Singh University, Bihar, and is
recognised by the Medical Council of India. The hospital started
operations in 2006 and the medical college in June 2008.
DMW CNC: CRISIL Assigns 'B-' Ratings to INR143.4MM Loans
--------------------------------------------------------
CRISIL has assigned its 'CRISIL B-/Stable/CRISIL A4' ratings to
the bank facilities of DMW CNC Solutions India (P) Ltd (DMW-CNC;
part of the DMW group).
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Term Loan 113.4 CRISIL B-/Stable
Bank Guarantee 19 CRISIL A4
Cash Credit 30 CRISIL B-/Stable
The ratings reflect the DMW group's large working capital
requirements and moderate scale of operations in the intensely
competitive engineering contract manufacturing industry. These
rating weaknesses are partially offset by the DMW group's above-
average financial risk profile marked by moderate gearing and
healthy debt protection metrics, and its promoters' extensive
experience in the engineering contract manufacturing industry.
For arriving at the ratings, CRISIL has combined the business and
financial risk profiles of DMW-CNC and Diesel Machinery Works
(DMW). This is because both the entities, together referred to as
the DMW group, are in the same line of business, share a common
management, and have significant financial and operational
linkages.
Outlook: Stable
CRISIL believes that the DMW group will continue to benefit over
the medium term from the extensive experience of its promoters in
the engineering contract manufacturing segment. The outlook may be
revised to 'Positive' if the DMW group scales up its operations
significantly while maintaining its profitability, leading to
better-than-expected cash accruals and improvement in its
liquidity. Conversely, the outlook may be revised to 'Negative' if
the group reports lower-than-expected revenue or profitability, or
if its working capital management weakens resulting in weak
liquidity, or if it undertakes a large debt-funded capital
expenditure programme, leading to weakening in its financial risk
profile.
DMW-CNC, incorporated in 2005, manufactures high-precision
machined components and sub-assemblies. Its associate concern,
DMW, was established in 1991, and operates in the same line of
business. The DMW group's day-to-day operations are managed by its
director, Mr. Swaminathaswamy.
The DMW group reported a profit after tax (PAT) of INR6.9 million
on revenue of INR302.4 million for 2012-13 (refers to financial
year, April 1 to March 31), against a PAT of INR9.2 million on
revenue of INR347 million for 2011-12.
DURAIRAJ MILLS: ICRA Assigns 'D' Ratings to INR60MM Loans
---------------------------------------------------------
ICRA has assigned the long-term rating of '[ICRA]D' to the
INR37.77 crore term loan facilities, and the INR15.00 crore fund
based facilities of Durairaj Mills Limited. ICRA has assigned the
short-term rating of '[ICRA]D' to the INR5.00 crore short-term
non-fund based facilities of DML. ICRA has also assigned ratings
of [ICRA]D/[ICRA]D for the INR2.23 crore unallocated facilities of
DML. ICRA had earlier suspended the ratings for the bank
facilities of DML in December-2011; the suspension now stands
revoked.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Term loans 37.77 [ICRA]D Assigned
Long term-Fund
based facilities 15.00 [ICRA]D Assigned
Short-term-
Non-fund based
Facilities 5.00 [ICRA]D Assigned
Long-term/Short-
term unallocated
facilities 2.23 [ICRA]D/[ICRA]D Assigned
The assigned ratings reflect the tight liquidity position, which
has resulted in delays in debt servicing in 2012-13.
DML's operation was severely impacted by unfavourable government
policy on exports, which led to inventory losses in 2011-12 (owing
to sharp decline in cotton yarn and cotton fibre prices).
Inventory losses had affected the liquidity position of the
company, this coupled with higher debt repayments from the debt-
funded capital expenditure incurred in the past had led to delays
in debt servicing. This apart, paucity of working capital fund had
hindered the capacity utilization and revenue growth in 2012-13
and 2013-14. Going forward, with favourable operating environment
, stability between cotton yarn and cotton fibre prices,
forecasted for cotton spinning industry, the credit profile of the
company is likely to improve, however, for DML the same will be
contingent upon availability of sufficient liquidity. DML has
approached the lenders for a term loan-restructuring package to
tide over the liquidity issues; this is likely to ease the strain
on the liquidity in the near-term.
Durairaj Mills Limited, incorporated in 1983, engaged in
production of cotton Hosiery and cotton Warp yarn. DML has two
spinning facilities in Pongalur and Annur (located near,
Coimbatore) with a combined installed capacity of 39,042 spindles
with the counts produced ranging from 8s to 60s. The company
caters for the domestic demand of combed, carded and slub yarns
primarily to yarn markets in the states of Tamil Nadu and
Maharashtra. Prior to incorporating the mill the promoters had
interests in cotton trading and ginning, initially started in
1950s by Mr. N. Duraiswamy Naidu. Later his sons (Mr. P.D.
Damodaran, Mr. D. Kangaraj, Mr. D. Jayachandran and Mr. D.
Ramaswamy) decided to enter the spinning business. Apart from this
spinning business, the directors also derive income from
agricultural activities. The company has got ISO-9002
certification and won an award as Government Recognised Export
House.
Recent Results
For the six months ending September 30, 2013, DML had a profit
before tax of INR1.2 crore on an operating income of INR31.0
crore. During 2012-13, the Company had net loss of INR2.2 crore on
an operating income of INR61.3 crore.
EISHA ATHARVA: CRISIL Rates INR150MM Long-Term Loan at 'B'
----------------------------------------------------------
CRISIL has assigned its 'CRISIL B/Stable' rating to the long-term
bank facility of Eisha Atharva Construction.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Long-Term Loan 150 CRISIL B/Stable
The rating reflects project risks associated with the completion
and saleability of the firm's ongoing project given its early
stage of construction and low bookings. The rating also factors in
EAC's below-average financial risk profile, marked by its small
net worth and high gearing; along with stretched liquidity, driven
by large construction costs and low customer advances. These
rating strengths are partially offset by the extensive experience
of the promoters in the real estate sector in Pune, and the
group's established track record of timely completion of projects
in the past.
Outlook: Stable
CRISIL believes that EAC will benefit from the long-standing
experience of its promoters and the group's established presence
in the real estate sector in Pune. The outlook may be revised to
'Positive' if the firm reports better-than-expected bookings and
receipts of customer advances, resulting in sizeable cash inflows
and funding support from the promoters. Conversely, the outlook
may be revised to 'Negative' if EAC's liquidity weakens, either
because of slower-than-expected bookings, delays in receipt of
customer advances, or time or cost overruns in its ongoing
project.
EAC was established in Pune in 2012. The firm is a joint-venture
between two Pune-based real estate groups, the Eisha group and
Atharva group. EAC is developing a luxury residential real estate
project with a saleable area of 75,000 square feet. The project -
Synergy - is being developed in Salisbury Park, Pune; and
comprises two buildings of 11 floors each, with a total of 17 four
bedroom-hall-kitchen (BHK) flats and two duplexes.
The Eisha group has been active in the real estate segment in Pune
for over a decade, and has developed over 1 million square feet of
real estate in the city. The promoters -Mr. Hasmukh Jain, Mr.
Suvarnsingh Sohal and Mr.Bharat Nagori have more than three
decades of experience in the real estate sector.
The Atharva group has been operating in the real estate segment in
Pune for more than a decade, and is promoted by Mr. Ankush Jain.
EVEREST STARCH: CRISIL Assigns 'B+' Ratings to INR400MM Loans
-------------------------------------------------------------
CRISIL has revoked the suspension of its rating on the long-term
bank facilities of Everest Starch (India) Private Limited and has
assigned its 'CRISIL B+/Stable' rating to its facilities. The
rating had been suspended by CRISIL as per its rating rationale
dated Dec. 18, 2013, as ESIPL had not provided the necessary
information required for reviewing the rating. ESIPL has now
shared the requisite information.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 150 CRISIL B+/Stable (Assigned;
Suspension Revoked)
Term Loan 250 CRISIL B+/Stable (Assigned;
Suspension Revoked)
The rating reflects ESIPL's below-average financial risk profile,
constrained by aggressive gearing levels, and moderate exposure to
offtake related risks. These rating weaknesses are partially
offset by the promoters' extensive experience in agro industry and
manufacturing starch.
Outlook: Stable
CRISIL believes that ESIPL will continue to benefit over the
medium term from the extensive experience of its directors in
manufacturing starch and in other agro-related industries. The
outlook may be revised to 'Positive' in case of successful
stabilisation of ESIPL's project and generation of adequate cash
flows to meet debt obligations. Conversely, the outlook may be
revised to 'Negative' in case ESIPL faces any significant time or
cost overruns in commissioning its project, thereby constraining
the company's debt servicing abilities.
Incorporated in June 2011, ESIPL is setting up a starch and
glucose manufacturing plant with an installed capacity of 300
tonnes per day in Rajkot (Gujarat). The project cost of INR460
million is being funded by debt of INR250 million, equity of
INR100 million and unsecured loans of INR112 million. The company
plans to commence operations from this unit by March 2014.
ESIPL's profit after tax (PAT) and net sales are at INR0.1 million
and INR3.9 million respectively for 2012-13
GOPAL MASTERBATCH: CRISIL Assigns 'B+' Ratings to INR100MM Loans
----------------------------------------------------------------
CRISIL has assigned its 'CRISIL B+/Stable' rating to the long-term
bank facilities of Gopal Masterbatch Pvt Ltd.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Term Loan 48.5 CRISIL B+/Stable
Cash Credit 50 CRISIL B+/Stable
Proposed Long-Term
Bank Loan Facility 1.5 CRISIL B+/Stable
The rating reflects GMPL's large working capital requirements, and
nascent stage, and hence, small scale, of operations in the
intensely competitive computer cabinet industry along with below-
average financial risk profile, marked by highly leveraged capital
structure. These rating weaknesses are partially offset by the
extensive experience of GMPL's promoters in trading in computer
cabinets, and its established distribution network.
Outlook: Stable
CRISIL believes that GMPL will continue to benefit over the medium
term from its established distribution network and its promoters'
extensive industry experience. The outlook may be revised to
'Positive' if the company improves its capital structure, most
likely through equity infusion or higher-than-expected cash
accruals, backed by significant improvement in its revenues and
profitability along with better working capital management.
Conversely, the outlook may be revised to 'Negative' if GMPL's
financial risk profile, particularly its liquidity, deteriorates,
most likely due to lower-than-expected revenues and profitability
leading to muted cash accruals, or substantial debt-funded capital
expenditure, or large working capital requirements.
GMPL was incorporated in January 2013, promoted by Delhi-based
Mrs. Monika Babbar and her cousin, Mr. Goldi Binod. The company
has set up a manufacturing unit for computer cabinets in Neemrana,
district Alwar (Rajasthan). GMPL is expected to start commercial
production by the end of December 2013.
GUINEA MOTORS: CARE Rates INR16.37cr LT Bank Loans at 'B'
---------------------------------------------------------
CARE assigns 'CARE B' rating to the bank facilities of Guinea
Motors Pvt Ltd.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank
Facilities 16.37 CARE B Assigned
Rating Rationale
The rating assigned to the bank facilities of Guinea Motors Pvt
Ltd are primarily constrained by its thin profitability margins,
leveraged capital structure, limited bargaining power with TML and
dependence on volume momentum, renewal-based dealership agreement,
working capital intensive nature of the business and increasing
competition in the automobile sector.
The aforesaid constraints are partially offset by the longstanding
experience of the promoters in the automobile dealership business,
its long track record of operations and the advantage of being an
authorised dealer of TML for nine districts of Bihar.
The ability of the company to grow its scale of operations along
with an improvement in profitability margins and effective working
capital management would be the key rating sensitivities.
Guinea Motors Pvt Ltd. was incorporated in February 2000 by Mr
Arjun Kumar Gupta, Mr R. K. Singh and Mr Anand Gupta of Patna,
Bihar. The company commenced operation from January 2001 as an
authorized dealer of Tata Motors Ltd for its passenger cars,
spares & accessories for nine districts of Bihar. Subsequently in
the year 2007, the company also took the dealership of Fiat India
Automobiles Limited (Fiat), which was discontinued from the end of
March 2013 owing to expiration of TML's agreement with Fiat India
Limited (Fiat) for sharing of TML's automobile showrooms.
At present, GMPL offers passenger vehicles of TML through its two
showrooms (self-owned) equipped with 3-S facilities (sales,
service and spare-parts) at Patna and Begusarai districts of Bihar
along with four selling outlets (one each in Begusarai, Bihar
Sharif, Samastipur and Hazipur districts of Bihar). Apart from
this, the company also purchases and sells pre-owned cars.
In FY13 (refers to the period April 01 to March 31), GMPL reported
a PBILDT of INR3.8 crore and a PAT of INR0.2 crore on a total
operating income of INR66.8 crore.
HINDUSTAN MOTORS: C K Birla Steps Down as Chairman
--------------------------------------------------
The Times of India reports that two days after the company's
annual general meeting for the extended 18-month financial year, C
K Birla on Dec. 28, 2013, stepped down as chairman of Hindustan
Motors (HM) Ltd.
TOI relates that while Mr. Birla did not reply to reporters'
queries after the company's AGM, the company's managing director
and CEO Uttam Bose said that it was becoming very difficult for
the company to manage daily operations due to poor cash flow.
According to the report, the decision reflected Mr. Birla's
thinking that his stepping down would pave the way for the entry
of strategic investors and allow for greater flexibility during
discussions, the company said in a statement.
Mr. Bose had said the company needed to restructure the business
by demerging the Chennai and Uttarpara operations for which HM was
seeking strategic investors for both the units, the report relays.
During the 18-month period under review beginning April, 2012 and
ending September 2013, HM incurred a loss of INR71.20 crore as
compared to a loss of INR29.96 crore in FY2011-12, TOI discloses.
TOI notes that the company's accumulated losses have exceeded its
net worth at the completion of the extended financial year ended
Sept. 30, 2013.
Mr. Birla was appointed chairman of HM in November 1997.
Mr. Birla had also relinquished the post of directorship in the
company, the report says.
Hindustan Motors Limited -- http://www.hindmotor.com/-- is an
India-based Company engaged in the manufacture of automobiles and
components namely, castings, forgings and stampings. The Company
operates in two segments: automobiles, which consist of
manufacture and sale of passenger cars, utility vehicles, and
components and accessories; other segment comprises of remote
service division engaged in engineering services. The Company
focuses in Ambassador range of cars and utility vehicles,
Mitsubishi range of products, which include Lancer, Cedia, Pajero,
Montero and Outlander. Its subsidiaries include Hindustan Motor
Finance Corporation Limited, HM Export Limited and Hindustan
Motors Limited, USA.
JAY FORMULATIONS: CRISIL Raises Ratings on INR35MM Loans to 'B'
---------------------------------------------------------------
CRISIL has upgraded its ratings on the bank facilities of Jay
Formulations Ltd to 'CRISIL B/Stable/CRISIL A4' from 'CRISIL
D/CRISIL D'.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 30 CRISIL B/Stable (Upgraded
from 'CRISIL D')
Letter of Credit 40 CRISIL A4 (Upgraded from
'CRISIL D')
Term Loan 5 CRISIL B/Stable (Upgraded
from 'CRISIL D')
The rating upgrade reflects improvement in JFL's liquidity, due to
equity infusion of INR130 million in 2013-14 (refers to financial
year, April 1 to March 31) by the company's promoters, enabling
JFL to service its debt obligations in a timely manner since July
2013.
The ratings continue to reflect JFL's moderate financial risk
profile marked by high gearing and small net worth, and its large
working capital requirements. These rating weaknesses are
partially offset by its promoters' extensive experience in the
pharmaceutical industry, JFL's established relationship with the
customers, and the company's diversified business profile.
Outlook: Stable
CRISIL believes that JFL will continue to benefit from its
promoters' extensive industry experience, and its operating
profitability is expected to improve with increasing revenues from
the export as well as trading businesses. The outlook may be
revised to 'Positive' in case of higher than expected improvement
in the overall operating performance, aided by prudent working
capital management and significant improvement in the capital
structure. Conversely, the outlook may be revised to 'Negative' if
JFL's operating profitability deteriorates, driven by larger than
expected debt-funded capital expenditure or an increase in working
capital requirements, leading to further weakening of its capital
structure.
JFL was set up in 1988 by Mr. Ashvin J Patel and his family. The
company, based in Ahmedabad (Gujarat), is in the business of
contract manufacturing of formulations in tablet and capsule
forms.
For 2012-13, JFL reported a profit after tax (PAT) of INR 1.3
million on an operating income of INR127 million, against a PAT of
INR0.5 million on an operating income of INR117 million for 2011-
12.
KAILASH GINNING: CRISIL Reaffirms 'B' Ratings on INR120MM Loans
---------------------------------------------------------------
CRISIL's rating on the long-term bank facilities of Kailash
Ginning and Pressing Pvt Ltd continues to reflect KGPL's below-
average financial risk profile, marked by high gearing and weak
debt protection metrics. The rating also factors in the company's
exposure to intense competition in the highly fragmented textile
industry. These rating weakness are partially offset by the
extensive experience of KGPL's promoter in the cotton ginning
industry.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 100 CRISIL B/Stable (Reaffirmed)
Proposed Long-Term
Bank Loan Facility 20 CRISIL B/Stable (Reaffirmed)
Outlook: Stable
CRISIL believes that KGPL will continue to benefit from its
promoter's extensive experience in the cotton ginning and trading
industry. The outlook may be revised to 'Positive' if the company
reports a sustainable and significant increase in its cash
accruals; or receives a large equity infusion which improves its
capital structure. Conversely, the outlook may be revised to
'Negative' if KGPL's profitability declines because of volatility
in cotton prices; or its financial risk profile, particularly its
liquidity, deteriorates because of a stretch in working capital
cycle, or a larger-than-expected debt-funded capital expenditure
(capex) programme.
Update
For 2012-13 (refers to financial year, April 1 to March 31), KGPL
reported a topline of INR585 million, and a year-on-year growth of
14 per cent, in line with CRISIL's expectations. The company is
currently operating at near full capacity utilization. In the
absence of any capacity enhancements, KGPL's top line growth is
expected to be muted over the medium term. The company's operating
margin of 2.9 per cent in 2012-13 was in line with past trends,
and is likely to remain around 3 per cent over the medium term,
though susceptible to volatility in raw material prices. KGPL's
working capital requirements remained high, with gross current
assets (GCAs) of 128 days as on March 31, 2013, primarily driven
by high inventory, as the company stocks significant raw material
during crop season. The company's year-end working capital
requirements are likely to remain high due to its seasonal
operations.
KGPL's financial risk profile remains below-average, marked by its
small networth of INR19.8 million, and high gearing of 7.04 times
as on March 31, 2013. The company's debt protection metrics also
remained below-average, with net cash accruals to total debt
(NCATD) and interest coverage ratios of 0.02 times and 1.24 times,
respectively, for 2012-13. In the absence of any sizeable
improvement in KGPL's scale of operations or profitability, CRISIL
believes that the company's financial risk profile will remain
below-average over the medium term. KGPL's liquidity remained
stretched, marked by withdrawal of unsecured loans of INR20.9
million during 2012-13. As on March 31, 2013, the company had
unsecured loans of INR14.9 million outstanding. KGPL's cash
accruals is expected to remain modest at around INR3 million in
2013-14, vis-…-vis nil debt obligations. The company's bank limit
utilization also remained high during peak season, at over 95 per
cent. CRISIL believes that KGPL's liquidity will remain stretched
over the medium term, driven by low cash accruals.
KGPL was incorporated in 2006, and is promoted by the Rajkot-based
Mr. Dinesh Patel. The company has a cotton ginning and pressing
unit in Rajkot.
KC INDUSTRIES: CRISIL Assigns 'B+' Rating to INR110MM Loan
----------------------------------------------------------
CRISIL has revoked the suspension of its rating on the bank
facilities of KC Industries, and assigned its 'CRISIL B+/Stable'
rating to the long-term bank facility of KCI.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 110 CRISIL B+/Stable (Assigned;
Suspension revoked)
The ratings had been suspended by CRISIL as per its rating
rationale dated February 05, 2013, as KCI had not provided the
necessary information required for reviewing the ratings. KCI has
now shared the requisite information, thereby enabling CRISIL to
assign ratings to the company's bank facilities.
The rating reflects KCI's small scale of operations, large working
capital requirements, susceptibility to volatility in raw material
prices and to regulatory changes, and small net worth. These
rating weaknesses are partially offset by the extensive experience
of KCI's promoters in the rice industry.
Outlook: Stable
CRISIL believes that KCI will continue to benefit over the medium
term from the extensive industry experience of its promoters. Its
financial risk profile is, however, expected to remain weak
because of its large working capital requirements and small net
worth. The outlook may be revised to 'Positive' if the firm
substantially improves its operating margin and scale of
operations, while efficiently managing its working capital
requirements. Conversely, the outlook may be revised to 'Negative
'if KCI's operating margin declines or if it undertakes a large
debt-funded capital expenditure programme, further weakening its
financial risk profile.
KCI is part of the KC group of Jalalabad (Punjab). The company is
managed by Mr. Anil Kumar. KCI processes and sells basmati rice.
The group primarily processes the PUSA 1121 variety of basmati
rice for its own sales and as well as on a job-work basis for
others.
KHANDOGOSH AGRO: CARE Assigns 'B+' Rating to INR4.73cr LT Loans
---------------------------------------------------------------
CARE assigns 'CARE B+' and 'CARE A4' ratings to the bank
facilities of Khandogosh Agro Product Private Limited.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank
Facilities 4.73 CARE B+ Assigned
Short-term Bank
Facilities 0.21 CARE A4 Assigned
Rating Rationale
The ratings assigned to the bank facilities of Khandogosh Agro
Products Private Limited are constrained by its nascent stage of
operations in an intensely competitive and regulated nature
industry characterized by the presence of a number of small
players, high working capital intensity of its business and
exposure to vagaries of nature. However, the ratings derive
strength from the promoter's experience, its proximity to raw
material sources and favorable industry scenario.
The ability of the company to market its product successfully,
increase its scale of operations and profitability will be the key
ratings sensitivities.
Burdwan-based (West Bengal) KAPL, incorporated in June 2008, was
promoted by brothers, Mr DinabandhuPatra and Mr SubrataPatra and
their family friends, Mr Arindam Kundu & Ms TinkuDey. The company
was promoted to set up a processing & milling unit of non-basmati
rice and sale of its by-products like husk, bran, etc, in the
domestic market. The plant, having an installed rice processing
capacity of 28,800 metric tonnes per annum (MTPA) and sorting
capacity of 6 tons/hour, is situated in the Burdwan district of
West Bengal, a major paddy-growing area and in close proximity to
the local grain market enabling easy paddy procurement.
The unit was set up at an aggregate project cost of INR5.8 crore,
being financed at a debt-equity ratio of 1.76:1. The plant became
operational in July 2012 with a delay of seven months due to delay
in receipt of plant and machineries from the suppliers. On account
of deferment of commercial production, repayment terms of its term
debt was rescheduled and the repayment commenced from August 2012
against the earlier scheduled date from December 2011. However,
there was no cost overrun.
As per the provisional result for 9MFY13 (refers to the period
July 1 to March 31), KAPL achieved a PBILDT and PAT of INR1.3
crore and INR 0.1 crore respectively on a total income of INR14.5
crore.
KINGFISHER AIRLINES: Workers to Seek Kejriwal's Help to Get Dues
----------------------------------------------------------------
The Press Trust of India reports that the employees of the
grounded Kingfisher Airlines, who have not been paid their
salaries for the past 17 months, said they will seek help from
Delhi chief minister Arvind Kejriwal in getting their dues.
"In the past, we have requested to both the Congress and the BJP
to intervene in the issue. But none of them did come to our help.
We will now approach Delhi chief minister Arvind Kejriwal and seek
his help in getting our dues cleared," a Delhi-based Kingfisher
Airlines employee told PTI.
He said a section of employees from Delhi will soon seek an
appointment with Mr. Kejriwal to apprise him of the "trauma, agony
and the financial hardship" that around 2,000 unpaid employees are
going through for almost a year and a half, according to the news
agency.
Mr. Kejriwal sounds a "different" politician unlike others who are
high on rhetoric but low on action, he said adding, "We are quite
hopeful that Kejriwal will intervene in our issue in whatever way
he can," PTI relays.
The grounded airline has over 500 employees in Delhi. "We are all
more hopeful from him as he is the one who works for common man
unlike the two national parties who get elected with the common
man's vote but forget them soon after the polls," the employee
told PTI.
Mr. Kejriwal's Aam Aadmi Party won 28 seats in the Delhi assembly
polls on the promises like 700 litre free water and 50 per cent
reduction in electricity tariffs by way of rigorous scrutiny of
the private discoms balance sheet by the CAG, besides rooting out
corruption at both the government level as well as in the
corporate, PTI adds.
Headquartered in Mumbai, India, Kingfisher Airlines --
http://www.flykingfisher.com/-- formerly known as Deccan
Aviation Ltd., served about 35 domestic destinations with a fleet
of more than 40 aircraft, including Airbus jets and ATR 72
turboprops. It maintained bases in major cities such as Delhi and
Mumbai.
Kingfisher Airlines, which has been unprofitable since it was
created in 2005, accumulated losses of $1.9 billion between
May 2005 and June 30, 2012, The Wall Street Journal reported
citing Sydney-based consultant CAPA-Centre for Aviation. The
airline also owes about $2.5 billion to lenders, suppliers,
leasing companies and investors, The Journal added.
According to The Times of India, the company began showing signs
of weakness in November 2011 when it ran out of money to operate
most of its flights and started reducing its flights to cut cost.
The airline also failed to pay salaries to its employees for a
long time following which the employees went on an indefinite
strike. Its flying license was finally suspended in October 2012,
TOI reported.
KOHINOOR HATCHERIES: CRISIL Places 'B-' Ratings on INR642MM Loans
-----------------------------------------------------------------
CRISIL has assigned its 'CRISIL B-/Stable' rating to the long term
Bank facilities of Kohinoor Hatcheries Private Limited.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 180 CRISIL B-/Stable
Term Loan 462 CRISIL B-/Stable
The rating reflects the working capital intensive operations of
the company along with its below average financial risk profile
marked by high gearing and modest debt protection metrics and its
vulnerability to risks inherent in poultry industry .These rating
weaknesses are partially offset by KHPL's established regional
presence in poultry segment backed by experience of promoters.
Outlook: Stable
CRISIL believes that KHPL will continue to benefit over the medium
term from its promoters' extensive experience in the poultry
industry. The outlook may be revised to 'Positive' if the
company's revenues and profitability increase substantially or in
case of significant infusion of capital resulting in an
improvement in KHPL's capital structure leading to an improvement
in its financial risk profile. Conversely, the outlook may be
revised to 'Negative' if the company's revenues and profitability
decline substantially or if the firm undertakes a 'larger than
expected' debt-funded expansion, leading to deterioration in its
financial risk profile.
KHPL was incorporated in 1991 by Mr. D Raghava Rao. The company is
engaged in undertaking poultry breeding and is based out of
Hyderabad, Andhra Pradesh.
KHPL reported a profit after tax (PAT) of INR0.93 million on net
sales of INR295.1 million for 2012-13 (refers to financial year,
April 1 to March 31), as against net loss of INR7.5 million on net
sales of INR272.9 million for 2011-12.
KRISHNA GINNING: ICRA Assigns 'B' Ratings to INR6.8cr Loans
-----------------------------------------------------------
The rating of '[ICRA]B' has been assigned to the INR6.80 crore
fund-based facilities of Krishna Ginning Pressing and Oil
Industries.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long term fund 5.00 [ICRA]B assigned
based-Cash
Credit
Long term fund 1.80 [ICRA]B assigned
based-Term loan
The assigned rating is constrained by KGPOI's limited track record
of operations; weak financial profile as evident from highly
leveraged capital structure, low profitability and coverage
indicators given the initial year of operations with plant yet to
stabilize. The rating is further constrained on account of the
regulatory risks associated with cotton exports as well as the
fragmented nature of the cotton ginning industry resulting in high
competitive intensity. Further, the firm is exposed to adverse
movements in raw material (cotton) prices which coupled with low
value additive nature of the work, keeps the profitability metrics
and cash accruals at modest levels. ICRA also notes that KGPOI is
a partnership firm and any significant withdrawals from the
capital account would affect its net worth and thereby the gearing
levels.
The rating, however, favorably considers the favorable location of
the plant giving it easy access to high quality raw cotton and
strong demand for cotton seed oil in Gujarat. Further ICRA has
considered KGPOI's presence in oil expelling which provides
diversification in product mix.
Established in 2012, Krishna Ginning Pressing and Oil Industries
is engaged in ginning, pressing as well as crushing operations.
The business is owned and managed by Mr. Dalpatbhai and other
family members. The firm's manufacturing facility is located in
Jamnagar, Gujarat. The firm has 24 ginning machines and 1 pressing
machine having a cumulative processing capacity of 125 TPD of raw
cotton. The firm is also equipped with 6 expellers for cottonseed
crushing to produce cottonseed oil as well as cottonseed oil cakes
with production capacity of 7500 kgs of cottonseed oil per day.
The firm commenced commercial operations from March 2013.
MUNISH FORGE: CRISIL Reaffirms 'B+' Ratings on INR278MM Loans
-------------------------------------------------------------
CRISIL's ratings on the bank facilities of Munish Forge Pvt Ltd (a
part of the Munish group) continue to reflect the Munish group's
weak financial risk profile, marked by weak debt protection
metrics and large working capital requirements. These rating
weaknesses are partially offset by the Munish group's diversified
revenue profile and presence in the high-value-added products
segment.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 170 CRISIL B+/Stable (Reaffirmed)
Letter of Credit 140 CRISIL A4 (Reaffirmed)
Proposed Long-Term
Bank Loan Facility 90.4 CRISIL B+/Stable (Reaffirmed)
Term Loan 17.6 CRISIL B+/Stable (Reaffirmed)
For arriving at the ratings, CRISIL has combined the business and
financial risk profiles of MFPL, Munish International Pvt Ltd
(MIPL), and Dev Arjuna Cast & Forge Pvt Ltd, collectively referred
to as the Munish group. This is because MIPL works as an exclusive
export arm of the products manufactured by MFPL and DACF, and MFPL
and DACF sell largely to MIPL. All the three companies have also
extended corporate guarantee for each other's bank lines.
Outlook: Stable
CRISIL believes that the Munish group will benefit over the medium
term from its diversified revenue profile; however, the group's
financial risk profile will remain constrained by weak debt
protection metrics. The outlook may be revised to 'Positive' in
case of significant improvement in the Munish group's liquidity,
most likely through sharp improvement in accruals and improvement
in working capital cycle. Conversely, the outlook may be revised
to 'Negative' in case of deterioration in the group's liquidity
due to less-than-expected cash accruals, large working capital
requirements, or large debt-funded capital expenditure.
Update
The Munish group's revenue declined year-on-year by around 3 per
cent to around INR1.16 billion in 2012-13 (refers to financial
year, April 1 to March 31); the decline in revenue was mainly due
to growth slowdown in the end-user industry. CRISIL believes that
the Munish group's revenue growth will remain supported by the
group's diversified revenue profile and presence in the high-
value-added products segment over the medium term. The group's
operating margin remained stable around 7 per cent in 2012-13.
The Munish group's operations are highly working capital intensive
as reflected in its gross current assets (GCAs) of over 250 days
as on March 31, 2013; the GCAs have been at similar levels in the
past. These GCAs consist of inventory of 90 to 100 days and
debtors of 100 to 125 days. As a result, the group's average bank
limit utilisation was 90 per cent during the 12 months through
October 2013.
The Munish group's net worth remained moderate at INR307 million
as on March 31, 2013; therefore, the group had moderate financial
flexibility to meet any exigency. It has contracted substantial
debt for funding its working capital requirements; this, coupled
with its moderate net worth, is estimated to have resulted in
moderate gearing of 1.37 times as on March 31, 2013.
Set up in 1985 as a partnership firm, MIPL was converted into a
private limited company in 2006. MIPL is a part of the Munish
group of companies based in Ludhiana (Punjab), and is the export
arm of the group. The Munish group manufactures automobile
components (off-highway vehicles), flanges, and scaffoldings
through its two manufacturing arms: MFPL and DACF. The group's
three manufacturing facilities-one in MFPL and two in DACF-are
located in Ludhiana.
MIPL also exports some goods imported from China. The company,
however, imports from China only against specific orders from
customers. In the domestic market, MIPL procures majority of its
requirement from its group companies MFPL and DACF with minimal
procurement from outside the group.
MUNISH INT'L: CRISIL Reaffirms 'B+' Ratings on INR85.3MM Loans
--------------------------------------------------------------
CRISIL's ratings on the bank facilities of Munish International
Pvt. Ltd (MIPL; a part of the Munish group) continues to reflect
the Munish group's weak financial risk profile, marked by weak
debt protection metrics and large working capital requirements.
These rating weaknesses are partially offset by the Munish group's
diversified revenue profile and presence in the high-value-added
products segment.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 80 CRISIL B+/Stable (Reaffirmed)
Letter of Credit 31.5 CRISIL A4 (Reaffirmed)
Proposed Long-Term
Bank Loan Facility 5.3 CRISIL B+/Stable (Reaffirmed)
For arriving at the ratings, CRISIL has combined the business and
financial risk profiles of MFPL, Munish International Pvt Ltd
(MIPL), and Dev Arjuna Cast & Forge Pvt Ltd (DACF), collectively
referred to as the Munish group. This is because MIPL works as an
exclusive export arm of the products manufactured by MFPL and
DACF, and MFPL and DACF sell largely to MIPL. All the three
companies have also extended corporate guarantee for each other's
bank lines.
Outlook: Stable
CRISIL believes that the Munish group will benefit over the medium
term from its diversified revenue profile; however, the group's
financial risk profile will remain constrained by weak debt
protection metrics. The outlook may be revised to 'Positive' in
case of significant improvement in the Munish group's liquidity,
most likely through sharp improvement in accruals and improvement
in working capital cycle. Conversely, the outlook may be revised
to 'Negative' in case of deterioration in the group's liquidity
due to less-than-expected cash accruals, large working capital
requirements, or large debt-funded capital expenditure.
Update
The Munish group's revenue declined year-on-year by around 3 per
cent to around INR1.16 billion in 2012-13 (refers to financial
year, April 1 to March 31); the decline in revenue was mainly due
to slowdown in the end-user industry. CRISIL believes that the
Munish group's revenue growth will remain supported by the group's
diversified revenue profile and presence in the high-value-added
products segment over the medium term. The group's operating
margin remained stable around 7 per cent in 2012-13.
The Munish group's operations are highly working capital intensive
as reflected in its gross current assets (GCAs) of over 250 days
as on March 31, 2013; the GCAs have been at similar levels in the
past. These GCAs consist of inventory of 90 to 100 days and
debtors of 100 to 125 days. As a result, the group's average bank
limit utilisation was 90 per cent during the 12 months through
October 2013.
The Munish group's net worth remained moderate at INR307 million
as on March 31, 2013; therefore, the group had moderate financial
flexibility to meet any exigency. It has contracted substantial
debt for funding its working capital requirements; this, coupled
with its moderate net worth, is estimated to have resulted in
moderate gearing of 1.37 times as on March 31, 2013.
Set up in 1985 as a partnership firm, MIPL was converted into a
private limited company in 2006. MIPL is a part of the Munish
group of companies based in Ludhiana (Punjab), and is the export
arm of the group. The Munish group manufactures automobile
components (off-highway vehicles), flanges, and scaffoldings
through its two manufacturing arms: MFPL and DACF. The group's
three manufacturing facilities-one in MFPL and two in DACF-are
located in Ludhiana.
MIPL also exports some goods imported from China. The company,
however, imports from China only against specific orders from
customers. In the domestic market, MIPL procures majority of its
requirement from its group companies MFPL and DACF with minimal
procurement from outside the group.
NIRALA RICE: CRISIL Assigns 'B+' Ratings to INR59MM Loans
---------------------------------------------------------
CRISIL has assigned its 'CRISIL B+/Stable/CRISIL A4' ratings to
the bank facilities of Nirala Rice Mill Pvt Ltd.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Term Loan 8 CRISIL B+/Stable
Standby Line of Credit 5 CRISIL B+/Stable
Bank Guarantee 1 CRISIL A4
Cash Credit 46 CRISIL B+/Stable
The rating reflects NRMPL's modest scale of operations and
exposure to intense competition in the rice milling industry along
with its below-average financial risk profile. These rating
weaknesses are partially offset by the experience of NRMPL's
promoters in the rice milling industry.
Outlook: Stable
CRISIL believes that NRMPL will continue to benefit from the
extensive experience of its promoters in the rice milling industry
over the medium term. The outlook may be revised to 'Positive' if
NRMPL increases its scale of operations and profitability or in
case of significant capital infusion, leading to overall
improvement in the company's financial risk profile. Conversely,
the outlook may be revised to 'Negative' if NRMPL's revenues and
profitability decline substantially; or if its working capital
management weakens or in case of any significant debt-funded capex
plans by the company.
Incorporated in 2009, NRMPL is engaged in the milling and
processing of parboiled rice. Its rice mill is located near
Bardhaman (West Bengal). The company's day-to-day operations are
managed by Mr. Soumen Kesh.
NOBLE INDUSTRIES: ICRA Assigns 'C' Ratings to INR16cr Loans
-----------------------------------------------------------
ICRA has assigned an '[ICRA]C' rating to the INR15.92 crore fund
based bank facilities and INR0.08 crore unallocated limits of
Noble Industries.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Fund Based Limits
OCC 6.00 [ICRA]C assigned
Fund Based Limits
MTL 9.92 [ICRA]C assigned
Unallocated 0.08 [ICRA]C assigned
The assigned rating takes into account Noble's weak financial
profile characterized by low net profitability, moderate gearing
and low debt coverage indicators, its stretched liquidity position
with consistent over utilisation of working capital limits and
status as a proprietorship firm; including the risk of capital
withdrawal by the proprietor. The rating also takes into
consideration the high competitive intensity in the business and
Noble's limited bargaining power against its reputed customers
which restricts pricing flexibility and limits profitability. The
rating is also constrained on account of Noble's exposure to
significant customer concentration risk with Haier accounting for
around 71% and 64% of the total revenue in FY 2013 and FY 2014
(Apr-Oct) respectively. The rating, however, derives comfort from
the long experience of the promoters in the manufacturing of
consumer durable products and favourable demand outlook for the
industry in India which provides growth opportunities for players
including Noble. Moreover established relationship with principals
has ensured regular order inflow for the company. ICRA notes that
there has been consistent improvement in the turnover and working
capital intensity of operation over the last two years.
Nevertheless, high working capital requirement and sizeable term
loan repayments obligations in the near-to-medium term are
expected to keep Noble's liquidity position under pressure going
forward.
Setup in 2005, NI is involved in the manufacturing of washing
machine with a capacity to manufacture around 250,000 pieces/
annum. The firm was initially involved in the manufacturing of
washing machines, TV sets, refrigerators, DVD and others. In
September 2009, Noble's manufacturing facility witnessed a major
fire which resulted in loss of machinery and goods. After the
accident, the firm installed machinery for manufacturing washing
machines only. The manufacturing facility is located at Haridwar
(Uttarakhand)
OMSHREE RUBBER: CRISIL Reaffirms 'D' Ratings on INR61.2MM Loans
---------------------------------------------------------------
CRISIL's rating on the long-term bank facilities of Omshree Rubber
Reclaim Pvt Ltd continues to reflect instances of delay by OSRRPL
in servicing of its term debt; the delays have been caused by the
company's weak liquidity. OSRRPL's liquidity is weak marked by
nascent stage of operations resulting in negligible generation of
cash flows.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Term Loan 51.2 CRISIL D (Reaffirmed)
Cash Credit 10.0 CRISIL D (Reaffirmed)
OSRRPL also has a weak financial risk profile, marked by a small
net worth and high gearing, modest scale of operations, and
exposure to intense competition from large and established players
in the rubber industry. These rating weakness are partially offset
by the growth prospects for the reclaimed rubber industry and
experience of OSRRPL's promoters in the industry.
Update
OSRRPL has set up a crumb and reclaim rubber manufacturing unit at
total cost of INR100 million funded with bank loan of INR51.2
million, equity of INR15 million and the balance through unsecured
loans. Initially, the operations were to commence from September
2011; however, more-than-expected expenditure in civil work and
delays in receipt of machineries led to delay in commissioning of
the project resulting in time and cost overruns. The operations
from the unit commenced in April 2013 and for the seven months
through October 2013, OSRRPL registered revenue estimated at INR15
million. OSRPPL has entirely drawn down its bank loan and the
repayment has been commenced. Since OSRRPL's operations are in
nascent stage and the company not able to generate cash flows, its
liquidity has remained weak. The weak liquidity is also reflected
in average utilisation of its bank lines at 96 per cent for the
eight months through July 2013. This has resulted in delays in
servicing of its term debt. CRISIL believes that OSRRPL's
liquidity will remain weak over the medium term because of its
nascent stage of operations.
OSRRPL, based in Karnataka was promoted by Mr. Rajagopal B C, Mr.
K M Prakash, and Mr. C Bhaskar in December 2009. The company
commenced operations in April 2013 and manufactures crumb and
reclaim rubber used in manufacturing of tyres.
OPS JEWELLS: CRISIL Rates INR150MM Cash Credit at 'B+'
------------------------------------------------------
CRISIL has assigned its 'CRISIL B+/Stable' rating to the bank
facilities of OPS Jewells Private Ltd.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 150 CRISIL B+/Stable
The rating reflects OPSJPL's small scale of operations in the
highly competitive gems and jewellery industry; and the company's
weak financial profile, marked by high gearing and large working
capital requirements. These rating weaknesses are partially offset
by the promoter's extensive industry experience, and the
geographic diversification in OPSJPL's revenue profile.
Outlook: Stable
CRISIL believes that OPSJPL will benefit from the extensive
industry experience of the promoters in the gold and diamond
jewellery retail segment. The outlook may be revised to 'Positive'
if OPSJPL generates larger-than-expected cash accruals, most
likely due to a significant improvement in its scale of
operations, thereby enhancing its financial risk profile.
Conversely, the outlook may be revised to 'Negative' if the
company's financial risk profile weakens due to deterioration of
its capital structure, with significant incremental working
capital requirements; or if the company undertakes debt-funded
capital expenditure (capex) programmes.
OPSJPL was founded in 2011 by Mr. Kailash Chand Gupta and his
sons, Mr. Amit and Vikas Bansal in Karnal (Haryana). The company
retails diamond, gold and silver jewellery and ornaments through
its two showrooms in Karnal and Panipat, Haryana. Mr. Vikas Bansal
manages the day-to-day operations of OPSJPL's Karnal showroom, and
Mr. Amit Bansal manages the operations of the Panipat showroom.
OPSJPL reported a profit after tax (PAT) of INR4.7 million on net
sales of INR230.9 million for 2012-13 (refers to financial year,
April 1 to March 31), vis-…-vis a PAT of INR1.0 million on net
sales of INR57.4 million for 2011-12.
POLYPLASTICS IND: CRISIL Reaffirms 'B' Rating on INR568.3M Loan
---------------------------------------------------------------
CRISIL's ratings on the bank facilities of Polyplastics Industries
(India) Pvt Ltd (PPI; part of the Polyplastic group) continue to
reflect the Polyplastic group's below-average financial risk
profile, marked by a modest net worth and average gearing, and its
modest scale of operations with high customer concentration. These
rating weaknesses are partially offset by the extensive experience
of the group's promoters in the automobile ancillary industry, and
its established relationships with key clients such as Maruti
Suzuki India Ltd (rated 'CRISIL AAA/Stable/CRISIL A1+'), Hero
Motocorp Ltd ('CRISIL AAA/Stable/CRISIL A1+'), Tata Motors Ltd
(rated 'CRISIL AA-/Positive/CRISIL A1+'), and Ford India Pvt Ltd.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Bank Guarantee 20 CRISIL A4 (Reaffirmed)
Cash Credit 320 CRISIL B/Stable (Reaffirmed)
Letter of Credit 80 CRISIL A4 (Reaffirmed)
Proposed Long-Term
Bank Loan Facility 18.3 CRISIL B/Stable (Reaffirmed)
Term Loan 230 CRISIL B/Stable (Reaffirmed)
For arriving at its rating, CRISIL has combined the business and
financial risk profiles of Polyplastics Industries (India) Pvt Ltd
(PPI), Polyplastics Auto Components Private Limited (PACPL),
[rated CRISIL B/Stable/CRISIL A4)], Polyplastics Uttar Bharat Pvt
Ltd (PUBL)[rated CRISIL B/Stable], and United Precision
Engineering Company (UPEC), together referred to as the
Polyplastic group. This is because all these entities have
significant intra-group operational linkages and are under a
common management.
Outlook: Stable
CRISIL believes that the Polyplastic group will continue to
benefit over the medium term from its promoters' extensive
industry experience and its established relationships with key
customers. The outlook may be revised to 'Positive' in case of
improvement in the group's financial risk profile, driven most
likely by equity infusion or significantly larger-than-expected
cash accruals, along with efficient working capital management.
Conversely, the outlook may be revised to 'Negative' in case of
further pressure on the Polyplastic group's financial risk
profile, particularly its liquidity, on account of lower-than-
anticipated cash accruals, larger-than-expected working capital
requirements, or debt-funded capital expenditure.
Incorporated in 2008, PPI manufactures automobile ancillary parts
such as emblems, wheel covers, garnishes, grills, door handles,
electroplated parts and other moulded parts.
Incorporated in 2008, PUBL manufactures wheel covers, bow ties
(General Motors' emblem), and injection-moulded components.
Incorporated in 2010, PACPL is a 100 per cent subsidiary of PPI.
The company is installing a facility to manufacture various
components such as grills, garnishes, covers, hubcaps and emblems.
The operations are expected to start in January 2014.
POLYPLASTICS UTTAR: CRISIL Reaffirms 'B' Ratings on INR88.9M Loan
-----------------------------------------------------------------
CRISIL's ratings on the bank facilities of Polyplastics Uttar
Bharat Pvt Ltd (PUBL; part of the Polyplastic group) continue to
reflect the Polyplastic group's below-average financial risk
profile, marked by a modest net worth and average gearing, and its
modest scale of operations with high customer concentration. These
rating weaknesses are partially offset by the extensive experience
of the group's promoters in the automobile ancillary industry, and
its established relationships with key clients such as Maruti
Suzuki India Ltd (rated 'CRISIL AAA/Stable/CRISIL A1+'), Hero
Motocorp Ltd ('CRISIL AAA/Stable/CRISIL A1+'), Tata Motors Ltd
(rated 'CRISIL AA-/Positive/CRISIL A1+'), and Ford India Pvt Ltd.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Bank Guarantee 40 CRISIL A4 (Reaffirmed)
Cash Credit 22.5 CRISIL B/Stable (Reaffirmed)
Proposed Long-Term
Bank Loan Facility 2.6 CRISIL B/Stable (Reaffirmed)
Term Loan 63.8 CRISIL B/Stable (Reaffirmed)
For arriving at its rating, CRISIL has combined the business and
financial risk profiles of Polyplastics Uttar Bharat Pvt Ltd
(PUBL), Polyplastics Industries (India) Pvt Ltd (PPI) [rated
CRISIL B/Stable/ CRISIL A4)], Polyplastics Auto Components Private
Limited (PACPL), [rated CRISIL B/Stable/ CRISIL A4)], and United
Precision Engineering Company (UPEC), together referred to as the
Polyplastic group. This is because all these entities have
significant intra-group operational linkages and are under a
common management.
Outlook: Stable
CRISIL believes that the Polyplastic group will continue to
benefit over the medium term from its promoters' extensive
industry experience and its established relationships with key
customers. The outlook may be revised to 'Positive' in case of
improvement in the group's financial risk profile, driven most
likely by equity infusion or significantly larger-than-expected
cash accruals, along with efficient working capital management.
Conversely, the outlook may be revised to 'Negative' in case of
further pressure on the Polyplastic group's financial risk
profile, particularly its liquidity, on account of lower-than-
anticipated cash accruals, larger-than-expected working capital
requirements, or debt-funded capital expenditure.
Incorporated in 2008, PUBL manufactures wheel covers, bow ties
(General Motors' emblem), and injection-moulded components.
Incorporated in 2008, PPI manufactures automobile ancillary parts
such as emblems, wheel covers, garnishes, grills, door handles,
electroplated parts and other moulded parts.
Incorporated in 2010, PACPL is a 100 per cent subsidiary of PPI.
The company is installing a facility to manufacture various
components such as grills, garnishes, covers, hubcaps and emblems.
The operations are expected to start in January 2014.
RAJCHANDRA AGENCIES: CRISIL Rates INR52.5MM Loan at 'B'
-------------------------------------------------------
CRISIL has assigned its 'CRISIL B/Stable' rating to the long-term
bank facilities of Rajchandra Agencies.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 52.5 CRISIL B/Stable
The rating reflects RA's below-average financial risk profile,
marked by small net worth, high gearing, and weak debt protection
metrics, and its weak liquidity, marked by tightly matched cash
accruals against term debt repayments. The rating also reflects
the firm's modest scale of operations in a fragmented industry and
its low operating margin. These rating weaknesses are partially
offset by the promoters' extensive experience of nearly two
decades in the distribution business along with their established
relationships with principals and customers.
Outlook: Stable
CRISIL believes that RA will benefit from its promoters' extensive
experience and established relationships with principals over the
medium term. The outlook may be revised to 'Positive' in case of
improvement in the firm's financial risk profile, especially its
liquidity, resulting from higher-than-expected cash accruals,
efficient working capital management, and funding support from the
promoters. Conversely, the outlook may be revised to 'Negative' in
case of deterioration in the firm's financial risk profile,
particularly its liquidity, on account of lower-than-expected cash
accruals or higher-than-expected working capital requirements or
any debt-funded capital expenditure.
Set up in 2004 as a partnership concern, RA is an authorised
distributor for Bharti Airtel Limited's prepaid and direct-to-home
(DTH) products, ITC's cigarette, foods, and personal care
products, and Lava International Ltd's mobile handsets for the
regions of Dahisar and Borivali in Mumbai (Maharashtra). RA is
promoted by Mr. Mukesh Gupta and Mr. Hari Gupta.
S.R INDUSTRIES: CRISIL Reaffirms 'D' Ratings on INR374.5MM Loans
----------------------------------------------------------------
CRISIL's ratings on the bank facilities of S.R Industries Ltd
continue to reflect instances of delay by SRIL in servicing its
debt; the delays have been caused by the company's weak liquidity
marked by full utilisation of working capital limits and negative
cash accruals from operations.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 158.1 CRISIL D (Reaffirmed)
Rupee Term Loan 216.4 CRISIL D (Reaffirmed)
SRIL also has a weak financial risk profile, marked by high
gearing and weak debt protection metrics. Furthermore, it operates
on a small scale, and has a limited track record, in the footwear
segment. However, SRIL benefits from its sound relationships and
long-term contracts with its customers such as PUMA AG, Adidas,
Reebok, and others for the supply of footwear.
SRIL was set up by Mr. R C Mahajan and Mr. Yash Mahajan in 1989;
it is a contract manufacturer of footwear. It sold its terry towel
business in April 2012 to focus on the footwear business. SRIL
also manufactures footwear under its own brands, Red Zone and
Front Foot.
SRIL reported a net loss of INR34.9 million on an operating income
of INR309.5 million for 2012-13 (refers to financial year, April 1
to June 30), against a net loss of INR161.7 million on an
operating income of INR450.7 million for 2011-12 (refers to
financial year, April 1 to March 31).
SATIA SYNTHETICS: CARE Raises Rating on INR100.92cr Loans t 'B-'
---------------------------------------------------------------
CARE revises the ratings assigned to the bank facilities of Satia
Synthetics Limited.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank 100.92 CARE B- Revised from
Facilities CARE D
Short-term Bank 18.50 CARE A4 Revised from
Facilities CARE D
Rating Rationale
The revision in the ratings of Satia Synthetics Limited takes into
account the regularization of debt servicing by the company and
improvement in the financial risk profile in FY13 (refers to the
period April 1 to March 31) and H1FY14. The ratings also consider
the promoters experience and established dealer network of the
company. However, the ratings continue to be constrained by the
working capital intensive nature of operations, high leverage and
vulnerability of profitability to volatility in the raw material
prices.
Going forward, SSL's ability to maintain healthy sales and
profitability along with efficient management of the working
capital and cash flow management would be the key rating
sensitivities.
SSL promoted in 1992 is a joint venture between by Mr Anil Satia
(69%) and Punjab State Industrial Development Corporation (PSIDC -
31%) and commenced commercial operations in 1997. The company is
engaged in manufacturing cotton yarn. SSL had its manufacturing
facilities located at Muktsar, Punjab. SSL started manufacturing
cotton yarn with 6,048 spindles in 1997 and gradually expanded the
capacity to the current level ie 55,248 spindles as on March 31,
2013.
For FY13 (refers to the period April 1 to March 31), SSL
registered a total operating income of INR240.06 crore with a
PBILDT of INR28.96 crore and net profit of INR3.65 crore as
against a loss of INR4.97 crore in FY12. During H1FY14, SHPL
achieved an income of INR119.53 crore with a net profit of INR1.52
crore and GCA of INR 3.87 crore.
SHELAR PROPERTIES: CRISIL Reaffirms 'D' Ratings on INR150MM Loans
-----------------------------------------------------------------
CRISIL's rating on the bank facilities of Shelar Properties Pvt
Ltd continues to reflect instances of delay by SPPL in servicing
its term debt; the delays have been caused by the company's weak
liquidity.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 25 CRISIL D (Reaffirmed)
Long-Term Loan 69.5 CRISIL D (Reaffirmed)
Proposed Long-Term
Bank Loan Facility 55.5 CRISIL D (Reaffirmed)
SPPL also has a modest scale of operations and is exposed to
intense industry competition. The company also has a weak
financial risk profile marked by a modest net worth and a high
gearing albeit supported by adequate debt protection metrics.
However, SPPL benefits from its promoter's extensive industry
experience, and the support that it derives from its group
companies.
Update
SPPL has been unable to service its term debt on time due to its
weak liquidity; the instalments due in the months of September
2013, October 2013, and November 2013 were paid in the first week
of December 2013. SPPL has weak liquidity due to depressed
accruals, large repayments, and on-going capital expenditure
(capex). The company generated insufficient accruals of INR83
million in 2012-13 (refers to financial year, April 1 to
March 31), against debt obligations of INR48 million and capex of
about INR87 million during the year.
SPPL reported a profit after tax (PAT) of INR49.3 million on net
sales of INR276.1 million for 2012-13, against a PAT of INR25.5
million on net sales of INR224.1 million for 2011-12.
SPPL, incorporated in 1999, operates two multi-facility hotels at
Nashik and Thane (both in Maharashtra). Both the hotels are being
operated under the brand name, Express-Inn. The day-to-day
operations of SPPL are managed by the promoter, Mr. Narayan
Shelar.
SHREE JAYSUNDAR: CRISIL Assigns 'D' Ratings to INR90MM Loans
------------------------------------------------------------
CRISIL has assigned its 'CRISIL D' rating to the bank facilities
of Shree Jaysundar Mills Pvt Ltd.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Standby Line of
Credit 3 CRISIL D
Cash Credit 20 CRISIL D
Long-Term Loan 67 CRISIL D
The rating reflects instances of delay by SJMPL in servicing its
term debt; the delays have been caused by the company's weak
liquidity, driven by large working capital requirements.
SJMPL also has a small scale of operations and a below-average
financial risk profile, marked by moderate gearing and weak debt
protection metrics. The company, however, benefits from the
extensive experience of its promoters in the textile industry.
Set up in 2007, SJMPL manufactures cotton yarn in counts ranging
from 40s to 100s. The day-to-day operations of the company are
managed by the managing director, Mr. S Sundaramoorthy.
SJMPL reported a profit after tax (PAT) of around INR0.3 million
on net sales of INR115 million for 2011-12 (refers to financial
year, April 1 to March 31), against a net loss of around INR0.6
million on net sales of INR110 million for 2010-11.
SHRI PRABHULINGESHWAR: ICRA Cuts Ratings on INR100MM Loans to 'D'
-----------------------------------------------------------------
ICRA has revised the long term rating of Shri Prabhulingeshwar
Sugars and Chemicals Limited to '[ICRA]D' from '[ICRA]B-' for
INR97.20 crore (earlier INR100.00 crore) fund based facilities and
INR2.80 crore (earlier nil) unallocated limits.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Fund Based Limits 97.20 Revised to [ICRA]D
Unallocated 2.80 Revised to [ICRA]D
The rating revision reflects SPSCL's stretched liquidity profile
as reflected by the high working capital utilization due to
significant build up of inventory levels, which has resulted in
delays in servicing of debt obligations. The rating is also
constrained by SPSCL's weak financial profile characterized by low
profitability, leveraged capital structure and weak coverage
indicators in FY13. Further, high cane costs coupled with low
sugar prices are expected to put pressure on the contribution
margins of the company and impact the coverage indicators going
forward. The rating continues to be constrained by the high
competitive intensity for procuring the sugarcane in the region of
operation of the company, the high regulatory intensity of the
sector (in terms of cane prices and exports), vulnerability of the
operations to agro climatic conditions which impact cane
availability, and high seasonality of the crushing which results
in inventory buildup impacting the liquidity position of players
including SPSCL. However, comfort is drawn from the long
experience of the promoter in the sugar industry, location of the
plant in relatively sugarcane intense and high recovery region
(Bagalkot district), integration of the plant into cogeneration,
and steady revenue generation from sales of molasses to a group
company resulting in partial de-risking from the volatility of the
sugar business. Going forward, improvement in the liquidity
position and timely service its debt obligations by the company
are the key rating sensitivities.
Shri Prabhulingeshwar Sugars and Chemicals Limited was
incorporated in 1995 and started crushing cane in 1999, the cane
crushing capacity was gradually increased from 2,500 TCD earlier
to 10,000 TCD. SPSCL increased its cogeneration capacity from 28.5
MW in sugar year (SY) 2012 to 38.5 MW in SY 2013 by commissioning
a 27 MW steam turbine in April 2013 and disposing the rented
condensation and extraction turbines. The plant is located in
Siddapur village in Bagalkot District of North Karnataka and is
promoted by Mr. Jagadeesh S Gudagunti, who apart from managing
SPSCL has long experience as a consultant and machinery supplier
for sugar and allied industries. In SY2013, SPSCL crushed 9.69
lakh MT and recovered 1.06 lakh MT of sugar at a recovery of
10.98%.
Recent Results
The company has reported a net profit of INR0.75 crore on an
operating income of INR384.60 crore during FY 2013; as compared to
a net profit of INR4.94 crore on an operating income of INR364.25
crore during FY2012.
SILVER GLOBAL: CRISIL Assigns 'D' Ratings to INR80MM Loans
----------------------------------------------------------
CRISIL has assigned its 'CRISIL D' rating to the bank facilities
of Silver Global Services Pvt Ltd.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 9 CRISIL D
Term Loan 71 CRISIL D
The rating reflects instances of delay by SGSPL in servicing its
debt; the delays have been caused by the company's weak liquidity.
SGSPL has weak liquidity because of its loss making operations
that are a result of its high expenditure amid stagnant revenues.
The ratings also factor in SGSPL's below-average financial risk
profile, marked by the company's small net worth and weak debt
protection metrics. These rating weaknesses are partially offset
by the extensive experience of SGSPL's promoter in the tank
container industry.
SGSPL was set up in 1998 as a proprietorship firm called Silver
Enterprises by Mr. Alphonso D'Souza and was reconstituted as a
private limited company in 2007 by Mr. D'Souza, his wife Mrs.
Stella D'Souza, his son Mr. Kevin D'Souza and his son-in-law Mr.
Rolan D'Costa. SGSPL is engaged in the handling, cleaning, testing
and maintenance of liquid carrying tank containers.
SGSPL's net loss and net sales are estimated at INR2.9 million and
INR52.1 million, respectively, for 2012-13 (refers to financial
year, April 1 to March 31); the company reported a net loss of
INR3.1 million on net sales of INR49.9 million for 2011-12.
ST. NICHOLAS: CRISIL Assigns 'B' Ratings to INR60MM Loans
---------------------------------------------------------
CRISIL has assigned its 'CRISIL B/Stable/CRISIL A4' ratings to the
bank facilities of St. Nicholas Cashew Exports.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Proposed Long-Term
Bank Loan Facility 20 CRISIL B/Stable
Cash Credit 40 CRISIL B/Stable
Packing Credit 20 CRISIL A4
The ratings reflect SCE's small scale and working-capital-
intensive operations, and weak financial risk profile marked by
modest net worth and weak debt protection metrics. These rating
weaknesses are partially offset by the extensive experience of
SCE's promoter in trading in cashew nuts and kernels.
Outlook: Stable
CRISIL believes that SCE will continue to benefit over the medium
term from its promoter's extensive industry experience. The
outlook may be revised to 'Positive' if the firm considerably
scales up its operations and profitability resulting in an
improvement in its financial risk profile. Conversely, the outlook
may be revised to 'Negative' if the firm records lower-than-
expected revenue and profitability or undertakes a larger-than-
expected debt-funded capital expenditure programme, resulting in
deterioration in its financial risk profile.
Set up as a proprietorship concern in 1980 by Mr. Y Rajan, SCE
processes raw cashew nuts. The firm is based in Kollam (Kerala).
SCE reported a profit after tax (PAT) of INR1.3 million on net
sales of INR137.6 million for 2012-13 (refers to financial year,
April 1 to March 31), against a PAT of INR1.2 million on net sales
of INR136.6 million for 2011-12.
SUNARK ALUMINIUM: ICRA Ups Rating on INR4.26cr Loan to 'C-'
-----------------------------------------------------------
ICRA has revised the long-term rating outstanding on the INR4.26
crore proposed term loan facilities (previously rated as
sanctioned term loan facility -- which has been fully repaid) of
Sunark Aluminium Industries Private Limited to '[ICRA]C-' from
'[ICRA]D'. ICRA has also revised the short-term rating outstanding
on the INR2.00 crore proposed fund based facilities (previously
rated as sanctioned fund based facility -- which has been fully
repaid) and the INR2.00 crore proposed non-fund based facilities
(previously rated as sanctioned non-fund based facility -- which
has been closed) to '[ICRA]A4' from '[ICRA]D'. ICRA has withdrawn
the long-term rating of '[ICRA]D' assigned to the INR0.25 crore
fund based (sub-limit) facility and the short-term rating of
'[ICRA]D' assigned to the INR1.25 crore fund based (sub-limit)
facility, since these facilities have been closed.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Proposed long term 4.26 Revised to [ICRA]C-
loan facilities from [ICRA]D
(previously rated
as sanctioned long
term loan facility-
which has been
fully repaid)
Proposed short term 2.00 Revised to [ICRA]A4
fund based facilities from [ICRA]D
(previously rated as
sanctioned short-term
fund based facility-
which has been fully
repaid)
Proposed short term 2.00 Revised to [ICRA]A4
non-fund based facilities from [ICRA]D
(previously rated as
sanctioned short term
non-fund based facility-
which has been closed)
Long term fund based (0.25) [ICRA]D withdrawn
(sub-limit) facility
Short term fund based
(sub-limit) facility (1.25) [ICRA]D withdrawn
The revision in ratings reflects the repayment of debt(s)
outstanding with bank by the Company, through the infusion of
unsecured loans by directors / promoters. The Company's operations
have been suspended; however, the Company's debts only comprise
unsecured loans from directors / promoters as on date, which are
interest-free and do not have any fixed repayment schedule.
According to the Company, there have been changes in the top
management and the operations are expected to resume in the year
2014. The ratings also consider the experience of the promoter in
the business of manufacture of aluminium powder for over 15 years;
and SAIPL's stretched financial profile characterised by high
working capital intensity, adverse capital structure and weak
coverage metrics.
SAIPL was incorporated in the year 2007, to manufacture atomized
aluminium powders, grits and granules. It has an installed
capacity to produce 2,400 Metric Tonnes (MT) per annum of atomized
aluminium powder and 1,800 MT per annum of aluminium
granules/grits. These products find application in coatings,
paints, explosives, printing inks, light weight concrete
manufacturing, rocket propellants, plastic manufacturing,
refractories, foundries, automobiles and in powder metallurgy. The
manufacturing facility of the company is located at Thiruthangal
in Tamil Nadu.
As on date, the Company's operations remain suspended and the
management expects operations to resume in the year 2014.
SURESOFT SYSTEMS: CRISIL Puts 'B' Ratings on INR130MM Loans
-----------------------------------------------------------
CRISIL has revoked the suspension of its rating on the long-term
bank facilities of Suresoft Systems Pvt Ltd and has assigned its
'CRISIL B/Stable' rating to these facilities.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 18 CRISIL B/Stable (Assigned;
Suspension Revoked)
Long-Term Loan 112 CRISIL B/Stable (Assigned;
Suspension Revoked)
The rating had been suspended by CRISIL as per its rating
rationale dated November 25, 2013, as SSPL had not provided the
necessary information required for reviewing the rating. SSPL has
now shared the requisite information.
The rating reflects SSPL's modest scale of operations, exposure to
risks related to intense competition in the software services
industry and below-average financial risk profile marked by weak
debt protection metrics. These rating weaknesses are partially
offset by its promoters' extensive experience in the embedded
systems software industry.
Outlook: Stable
CRISIL believes that SSPL will benefit over the medium term from
the extensive industry experience of its promoters. The outlook
may be revised to 'Positive' if the company substantially
increases its scale of operations and profitability resulting in
better-than-expected cash accruals, while improving its debt
protection metrics. Conversely, the outlook may be revised to
'Negative' if SSPL records lower-than expected cash accruals, or
undertakes a large debt-funded capital expenditure, or its working
capital deteriorates, thereby weakening its financial risk
profile.
SSPL, incorporated in 1997, provides embedded system software
solutions for digital consumer products, such as set top boxes and
televisions. The company is managed by Mr. Kanagasabapathy, Ms.
Nikila Rani, and Mr. Thillairajan.
SSPL reported a net loss of INR45.8 million on net sales of
INR65.9 million for 2012-13 (refers to financial year, April 1 to
March 31), as against a net loss of INR2.3 million on net sales of
INR81.2 million for 2009-10.
VEDANTA RESOURCES: Mining Restart No Impact on Moody's Ba1 CFR
--------------------------------------------------------------
Moody's says that the restart of the Karnataka iron ore mine has
no rating impact on Vedanta Resources plc's Ba1 corporate family
rating and its negative outlook, but the development is credit
positive.
On December 30, Sesa Sterlite Ltd. (SSL), Vedanta's 58.3%-owned
Indian subsidiary announced that it has restarted its Karnataka
iron ore operations following a ban on exports introduced in July
2010 and a total ban on mining since August 2011. The development
is credit positive as it could add around $75million to SSL's
EBITDA.
Technically, the ban on mining in Karnataka was lifted in April
2013 based on agreed reclamation and rehabilitation plans, but it
has taken over 8 months for mining clearances to be obtained.
Given its inland location, Moody's expects Vedanta's mine in
Karnataka to focus on supplying the domestic markets.
JSW Steel (unrated), which built India's first, single-site 10mtpa
steelworks in Karnataka, has been operating at reduced utilization
during the mining shutdown. Moody's expects that it could be a
buyer for any available iron ore from resumed mining operations
given that it has recently expanded its hot metal output.
In FYE March 2010, the former Sesa Goa churned out some 21.4
million tonne (mt) of iron ore from its mines in Goa (15.6mt),
Karnataka (4.0mt) and Odisha (1.8mt) with only 6% sold
domestically and with 85% exported to China. In FY 2011, buoyed by
high prices, thanks to strong Chinese demand and in spite of the
low-grade nature of the ore - chiefly "fines" and with only 52% to
58% iron content - Sesa Goa was able to generate EBITDA of $1.17
billion and was Vedanta's second most important EBITDA contributor
that year.
Despite probable strong local demand for the iron ore, Moody's
does not expect future realizations to be high. Vedanta is likely
to sell via auction to seek the best price. As a result, Moody's
expects SSL's Karnataka operations to generate modest EBITDA of
around $32/tonne based on Moody's assumption of global iron ore
prices (62% iron content, landed China) of around $110/tonne to
$120/tonne. The amount that can be mined under the approved plan
is restricted to 2.29mt per annum which, in a full year, Moody's
estimates could contribute around $75million of EBITDA.
"While this is small in the context of Vedanta's $5 billion or so
of EBITDA, it is significant for SSL which has relied on the
contributions from its subsidiaries, Cairn India Ltd. and
Hindustan Zinc Ltd., to mask its own loss-making operations" says
Greene, who is a Moody's Vice President and Senior Credit Officer
and is the Lead Analyst for Vedanta Resources plc.
Moody's notes that a large part of the aluminium business is
switched off and may well remain so, as raw material availability
is not currently assured, while the global primary aluminium
market is well-supplied. Furthermore, the stoppage in Goa, where
the company's most important iron ore resource is located and
where operations have been suspended since August 2012, continues.
However, the sale of around 4 million tonnes of its Goan iron ore
stock, authorized by the Supreme Court to start this quarter, will
help to stem the losses.
"Among our concerns reflected in the negative rating outlook is
the presence of some idle or under-utilised assets in Vedanta's
portfolio" says Greene. "A restart of the Goan iron ore operations
could be material to the group's prospects, although we are not
expecting the prior high margins to return, owing to the increase
in export duty, which has been levied at 30% since the end of
2011", Greene adds.
VGN HOMES: CRISIL Raises Ratings on INR1.75BB Loans to 'B'
----------------------------------------------------------
CRISIL has upgraded its rating on the long-term bank facilities of
VGN Homes Pvt Ltd to 'CRISIL B/Stable' from 'CRISIL D'
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Long-Term Loan 57.20 CRISIL B/Stable (Upgraded
from CRISIL D)
Overdraft Facility 70.00 CRISIL B/Stable (Upgraded
from CRISIL D)
Proposed Long-Term
Bank Loan Facility 1,622.80 CRISIL B/Stable (Upgraded
from CRISIL D)
The rating upgrade follows the timely servicing of debt
obligations by VHPL over the four months ended November 2013. The
upgrade also factors in CRISIL's belief that VHPL will generate
sufficient cash accruals to service its debt in a timely manner
over the medium term.
CRISIL's rating reflect VHPL's average financial risk profile
marked by high gearing and average debt protection metrics;
moreover, the company has a geographically concentrated revenue
profile and is exposed to intense industry competition. The
company, however, benefits from its established brand name in
Chennai (Tamil Nadu) and its promoters' extensive industry
experience.
Outlook Stable
CRISIL believes that VHPL will continue to benefit over the medium
term from its established market position in the Chennai real
estate market. The outlook may be revised to 'Positive' if VHPL's
liquidity improves further on account of strong cash inflows from
customer advances, and completes its projects without cost and
time overruns. Conversely, the outlook may be revised to
'Negative' if VHPL's liquidity is constrained by delayed bookings
or larger-than-expected debt contracted to fund the project.
VHPL, incorporated in 2004, develops residential apartments and
houses in Chennai and its suburbs. The company is part of the VGN
group, which was set up by Mr. V Guruswamy Naidu in 1942. VHPL is
currently managed by Mr. Devadoss, son of Mr. V Guruswamy Naidu.
VHPL reported, on a provisional basis, a profit after tax (PAT) of
INR76.7 million on net sales of INR1.2 billion for 2012-13 (refers
to financial year, April 1 to March 31), against a PAT of INR41.9
million on net sales of INR0.77 billion for 2011-12.
=====================
P H I L I P P I N E S
=====================
TRI-M TECHNOLOGIES: In Voluntary Liquidation, Dissolved
-------------------------------------------------------
The Board of Directors of RH Petrogas Limited disclosed that, its
wholly-owned subsidiary, Tri-M Technologies (Philippines) Inc.
("TRI-M Philippines"), which has been placed under voluntary
liquidation, has been dissolved.
The liquidation of TRI-M Philippines will not have an impact on
the consolidated net tangible assets and earnings per share of the
Group for the financial year ending December 31, 2013.
None of the Directors or the substantial shareholders of the
Company has any interest, direct or indirect, in the above
transaction.
====================
S O U T H K O R E A
====================
SSANGYONG ENG'G: Awaits Appointment of Debt Rescheduling Admin.
---------------------------------------------------------------
Kim Rahn at The Korea Times reports that construction-market
watchers are paying attention to whether Ssangyong Engineering &
Construction (E&C) Chairman and CEO Kim Seok-joon will be allowed
to retain his position following the cash-strapped firm's court
receivership application on Dec. 30.
According to the report, industry sources said the Seoul Central
District Court will decide whether to approve the builder's debt-
rescheduling program as early as this week. If approved, the court
will also appoint a legal administrator to lead the program --
either Mr. Kim or a third person.
The Korea Times notes that Ssangyong E&C had been under a workout
program since June. The report says the creditors' discussion for
additional financial support had faced a deadlock amid objections
by one of the major creditors, the Military Mutual Aid
Association.
As it was the company's second workout, the creditors sought to
kick Mr. Kim out, holding him responsible for managerial failure
and stagnant overseas projects, the report relays. It was rumored
that the creditors would demand Mr. Kim resign in return for
providing additional funds.
However, the builder's board of directors did not wait for the
creditors' final decision on the support but applied for court
protection. Now the court will decide Mr. Kim's fate, the report
notes.
Officials of the company claim Mr. Kim is the most suitable person
to lead the debt-rescheduling program as a legal administrator,
the report adds.
About Ssangyong Engineering
Based in Seoul, Korea, Ssangyong Engineering & Construction Co.,
Ltd. -- http://www.ssyenc.com/eng/-- is involved in the areas of
construction and engineering.
As reported in the Troubled Company Reporter-Asia Pacific on
Jan. 3, 2014, The Korea Times said Ssangyong Engineering &
Construction (E&C) has filed for court protection as its creditors
refused to finance the cash-strapped builder. Ssangyong E&C said
it held a board meeting Dec. 30 to ask the Seoul Central District
Court to lead a debt-rescheduling program after one of its major
creditors, the Military Mutual Aid Association, raised an
objection to additional financial support to it.
Ssangyong became the first Korean builder which filed for court
protection since the 1998 financial crisis that severely hit the
construction sector. Back then, major contractors such as Hyundai
Engineering & Construction and Daewoo Engineering & Construction
went through a debt workout program.
===============
X X X X X X X X
===============
* Bond Risk Increases in Asia-Pacific, Default Swaps Show
---------------------------------------------------------
Tanya Angerer at Bloomberg News reports that the cost of insuring
sovereign and corporate bonds in Asia and Australia from non-
payment rose on Jan. 3, according to traders of credit-default
swaps.
Bloomberg relates that the Markit iTraxx Australia index climbed 2
basis points to 99 basis points as of 11:33 a.m., Jan. 3 in
Sydney, Westpac Banking Corp. prices show. The gauge is poised for
its highest close since Dec. 18 and its biggest one-day increase
since Dec. 6, CMA data show.
According to the report, the Markit iTraxx Asia index of 40
investment-grade borrowers outside Japan increased 1 basis point
to 130.5 as of 8:30 a.m. in Singapore, prices from Australia & New
Zealand Banking Group Ltd. show. The benchmark, on track to
advance 3.5 basis points last week, is set for its highest close
since Dec. 10, after rising 15.8 basis points in 2013, according
to CMA, which is owned by McGraw-Hill Cos. and compiles prices
quoted by dealers in the private market.
Markets in Japan are closed Jan. 3 for a public holiday.
Bloomberg relates that CMA data show that the cost of insuring
notes against default in Asia's second-largest economy dropped
91.5 basis points last year to 67.5 basis points. That was the
measure's biggest yearly decline since 2009. A basis point is 0.01
percentage point.
Credit-default swap indexes are benchmarks for insuring bonds
against default and traders use them to speculate on credit
quality, says Bloomberg. A drop signals improving perceptions of
creditworthiness, while an increase suggests the opposite.
The swap contracts pay the buyer face value in exchange for the
underlying securities if a borrower fails to meet its debt
agreements, Bloomberg discloses.
*********
Tuesday's edition of the TCR-AP delivers a list of indicative
prices for bond issues that reportedly trade well below par.
Prices are obtained by TCR-AP editors from a variety of outside
sources during the prior week we think are reliable. Those
sources may not, however, be complete or accurate. The Tuesday
Bond Pricing table is compiled on the Friday prior to
publication. Prices reported are not intended to reflect actual
trades. Prices for actual trades are probably different. Our
objective is to share information, not make markets in publicly
traded securities. Nothing in the TCR-AP constitutes an offer
or solicitation to buy or sell any security of any kind. It is
likely that some entity affiliated with a TCR-AP editor holds
some position in the issuers' public debt and equity securities
about which we report.
A list of Meetings, Conferences and Seminars appears in each
Wednesday's edition of the TCR-AP. Submissions about insolvency-
related conferences are encouraged. Send announcements to
conferences@bankrupt.com
Friday's edition of the TCR-AP features a list of companies with
insolvent balance sheets obtained by our editors based on the
latest balance sheets publicly available a day prior to
publication. At first glance, this list may look like the
definitive compilation of stocks that are ideal to sell short.
Don't be fooled. Assets, for example, reported at historical
cost net of depreciation may understate the true value of a
firm's assets. A company may establish reserves on its balance
sheet for liabilities that may never materialize. The prices at
which equity securities trade in public market are determined by
more than a balance sheet solvency test.
*********
S U B S C R I P T I O N I N F O R M A T I O N
Troubled Company Reporter-Asia Pacific is a daily newsletter co-
published by Bankruptcy Creditors' Service, Inc., Fairless Hills,
Pennsylvania, USA, and Beard Group, Inc., Washington, D.C., USA.
Valerie U. Pascual, Marites O. Claro, Joy A. Agravante, Rousel
Elaine T. Fernandez, Julie Anne L. Toledo, and Peter A. Chapman,
Editors.
Copyright 2014. All rights reserved. ISSN: 1520-9482.
This material is copyrighted and any commercial use, resale or
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