/raid1/www/Hosts/bankrupt/TCRAP_Public/140228.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
Friday, February 28, 2014, Vol. 17, No. 42
Headlines
A U S T R A L I A
DATA FLEX: RSM Bird Appointed as Administrators
FORGE GROUP: Samsung C&T Takes Over Contract at Roy Hill mine
LIBERTY 2012-1: S&P Affirms 'BB' Rating on Class E Notes
MIRABELA NICKEL: Appoints KordaMentha as Administrators
MUSICIANS CLUB: Enters Into Voluntary Administration
PINE HILL: Braitling Family Buys Cattle Station
QANTAS AIRWAYS: Labor Unions Warn of Strike Action
TONIC HOMES: Melsom Robson Appointed as Administrators
C H I N A
CIFI HOLDINGS: Moody's Says 2013 Results Supports B1 CFR
EVERGRANDE REAL: Share Repurchases No Impact on Moody's B1 CFR
GEMDALE CORP: S&P Rates Proposed RMB-Denominated Sr. Notes 'BB-'
PARKSON RETAIL: Fitch Cuts LT IDR to 'BB'; Outlook Negative
I N D I A
ACTION ISPAT: ICRA Suspends 'D' Rating on INR957.68cr Loans
AJANTA INDIA: CRISIL Cuts Rating on INR316MM Loans to 'D'
AL-RKAYAN APPARELS: ICRA Reaffirms 'B+' Rating on INR14.5cr Loan
ARJUNA SOLVENT: ICRA Reaffirms 'C' Rating on INR29cr Loans
BABA BEARINGS: ICRA Suspends 'B+' Rating on INR4.82cr Loans
BALAJI ISPAT: CRISIL Rates INR60MM Cash Credit at 'B+'
BHAGWATI COTTON: CARE Reaffirms 'B' Rating on INR8cr Bank Loans
BHAGWATI SPONGE: CRISIL Reaffirms 'B+' Rating on INR219MM Loans
COASTAL CONSOLIDATED: CRISIL Cuts Rating on INR130MM Loan to B-
DHURIA RICE: ICRA Reaffirms 'B' Rating on INR6cr Cash Credit
ELTEL POWER: ICRA Reaffirms 'B' Rating on INR62cr Loans
GAJANAND RICE: ICRA Assigns 'B' Rating to INR8cr Loans
GIRIJA MODERN: CRISIL Cuts Rating on INR290MM Loans to 'B+'
GROVER IMPEX: ICRA Reaffirms 'B+' Rating on INR2cr Loans
GSP INTERNATIONAL: ICRA Cuts Rating on INR20cr Loans to 'B'
JANKI DASS: ICRA Assigns 'B' Rating to INR15cr Loans
JAY METAL: ICRA Assigns 'B' Rating to INR5.35cr Loans
JUGAL KISHORE: CRISIL Reaffirms B+ Rating on INR19MM Loan
LA CASA: CRISIL Reaffirms 'B' Rating on INR85MM Loans
LAKDA DAL: CARE Reaffirms 'B+' Rating on INR5.25cr Bank Loans
LEKH RAJ: CRISIL Assigns 'B' Rating to INR80MM Loan
MACHINO AUTO: ICRA Cuts Rating on INR40.7cr Loans to 'D'
MALU PAPER: ICRA Upgrades Rating on INR88cr Loans to 'C'
MANGALAM TIMBER: CARE Assigns 'B+' Rating to INR12.28cr Loans
MATRIX BOILERS: CRISIL Puts 'B+' Rating on INR40MM Loan
MGR AGRO: CARE Reaffirms 'B+' Rating on INR10.88cr Loans
MICRO PRECISION: ICRA Reaffirms B+ Rating on INR7.5cr Loans
NV DISTILLERIES: CARE Upgrades Rating on INR114.95cr Loan to BB-
PAR DRUGS: ICRA Revises Rating on INR33.68cr Loans to 'D'
PATIDAR COTSPIN: CARE Revises Rating on INR15.54cr Loan to 'D'
PETRO CHEM: ICRA Withdraws B+ Rating on INR5cr Loans
PSN MOTORS: CRISIL Assigns 'B' Rating to INR90MM Loans
R K SHAH: ICRA Assigns 'C' Rating to INR10cr Loans
RAJMAL LAKHICHAND: ICRA Cuts Rating on INR240.74cr Loans to D
REALTRACK WIRE: CARE Revises Rating on INR13.73cr Loan to 'D'
RELCOM TECHNOLOGY: ICRA Rates INR11.75cr Loans at 'B'
ROUNDWELL STEEL: CARE Revises Rating on INR6.80cr Loans to 'B+'
SADHU RAM: CRISIL Reaffirms 'B+' Rating on INR19MM Loan
SAI LEKSHMI: CRISIL Puts 'B' Rating to INR60MM Loans
SAMRAKSHANA ELECTRICALS: CRISIL Ups INR358.7MM Loan Rating to B-
SHREE DATTA: CRISIL Reaffirms 'B+' Rating on INR80MM Loan
SHREE VINAYAK: ICRA Suspends 'B- Rating on INR7.10cr Loans
SREE GURU: CRISIL Assigns 'B-' Rating to INR50MM Loan
SRI NACHAMMAI: CRISIL Ups Rating on INR391MM Loans to 'B+'
SRI VARADHARAJA: CARE Revises Rating on INR6.73cr Loan to 'BB-'
SRI VENKATESWARA: ICRA Assigns 'B' Rating to INR32.70cr Loans
SSM FOUNDATION: CRISIL Cuts Rating on INR75.1MM Loan to 'C'
SUNRISE AGRO: CRISIL Assigns 'B' Rating to INR50MM Loans
SUPRIYA SPINNING: ICRA Reaffirms B Rating on INR87.63cr Loan
SWAMINARAYAN DIAMONDS: CRISIL Rates INR350MM Loan at 'B+'
TCS & ASSOCIATES: ICRA Assigns 'B+' Rating to INR12.50cr Loan
TECHNOMAX BUILDING: CRISIL Reaffirms D Rating on INR305.6MM Loan
THAPAR KNITWEAR: CRISIL Reaffirms 'B' Rating on INR150MM Loan
VENKATESH COTTON: CARE Revises Rating on INR9.48cr Loan to 'B+'
J A P A N
SONY CORP: To Close Two-Thirds of U.S. Stores
N E W Z E A L A N D
ROSS ASSET: Investors Frustrated Over House Sale Proceeds
P H I L I P P I N E S
RURAL BANK OF SEBASTE: PDIC Files Charges vs. Ex-Pres. & VP
S O U T H K O R E A
TONG YANG: Yuanta Securities Picked as Preferred Bidder
X X X X X X X X
* Large Companies with Insolvent Balance Sheets
- - - - -
=================
A U S T R A L I A
=================
DATA FLEX: RSM Bird Appointed as Administrators
-----------------------------------------------
Frank Lo Pilato -- frank.lopilato@rsmi.com.au -- and Jonathon
Colbran -- jonathon.colbran@rsmi.com.au -- at RSM Bird Cameron
were appointed as administrators of Data Flex Pty Limited on
Feb. 25, 2014.
A first meeting of the creditors of the Company will be held at
The Institute of Chartered Accountants Australia, Level 10,
60 Marcus Clarke Street, in Canberra, on March 7, 2014, at
11:00 a.m.
FORGE GROUP: Samsung C&T Takes Over Contract at Roy Hill mine
-------------------------------------------------------------
Vicky Validakis at Australian Mining reports that lead contractor
at Gina Rinehart's Roy Hill mine, Samsung C&T, said it will take
over the work left by the collapsed Forge Group.
Australian Mining relates that the announcement comes just months
after Forge and Spanish firm Duro Felguera were awarded a
AUD1.47 billion contract by Samsung to provide engineering,
procurement and construction services at Roy Hill.
The joint venture was scrapped earlier this month when Forge went
into administration, the report says.
According to the report, Samsung said it would take over the scope
of work left by Forge and engage "more experienced and sound local
contractors".
"After the insolvency of Forge Group, Samsung C&T has been working
with the client Roy Hill closely and co-operatively and resumed
the civil works promptly," Samsung, as cited by Australian Mining,
said. "Critical progress is under control and the rail and port
packages are under smooth progress as scheduled."
The company said it was confident the mine would produce first ore
in September 2015 as work ramps up at the AUD10 billion project,
the report relates.
The project includes a new 55 million tonne per annum iron ore
mine, 344 kilometres of railway and a new port at Port Hedland,
Australian Mining notes.
Forge Group Limited (ASX:FGE) -- http://www.forgegroup.com.au--
is engaged in construction, commercial building, engineering,
maintenance and workshop fabrication. Forge is the holding company
of Cimeco Pty Ltd, Webb Construction West Africa Ltd, Abesque
Engineering Ltd (Abesque) and CTEC Pty Ltd, which provide a range
of engineering and construction services to a diverse range of
clients particularly to the resource and oil and gas sectors
through its operating entities.
Martin Jones, Andrew Saker and Ben Johnson of Ferrier Hodgson were
appointed as Joint and Several Voluntary Administrators of the
Company on Feb. 11, 2014. As a consequence, the financiers have,
pursuant to their securities, appointed Mark Mentha and Scott
Langdon of KordaMentha as Receivers and Managers.
The Australian said that the administrators were called in after
Forge's financier ANZ Group withdrew its support.
LIBERTY 2012-1: S&P Affirms 'BB' Rating on Class E Notes
--------------------------------------------------------
Standard & Poor's Ratings Services affirmed its ratings on seven
classes of nonconforming residential mortgage-backed securities
(RMBS) issued by Liberty Funding Pty. Ltd. in respect of the
Liberty Series 2012-1 Trust (see list). The ratings reflect S&P's
opinion of the transaction's credit support, collateral pool,
servicer, and other features, based on S&P's current criteria and
assumptions.
The rating affirmations reflect S&P's view of Liberty Series 2012-
1 Trust's ability to meet timely payment of interest and ultimate
payment of principal to the noteholders under the relevant rating
stresses. Key rating factors are the level of subordination
provided; the provision of the liquidity facility, sized at 2.5%
of the outstanding balance; the excess revenue reserve mechanism
that builds from excess spread and is used to cover required
payments; the principal draw function; and sequential payment
structure.
Arrears have risen since close, but this is not outside S&P's
expectation of the performance of the underlying pool, given
arrears were zero at close, and the collateral consists of
nonconforming borrowers.
In addition, the presence of National Australia Bank Ltd. as
provider of the interest-rate swap and liquidity facility as a
dependent counterparty also supports S&P's view of the ratings on
all rated notes.
STANDARD & POOR'S 17G-7 DISCLOSURE REPORT
SEC Rule 17g-7 requires an NRSRO, for any report accompanying a
credit rating relating to an asset-backed security as defined in
the Rule, to include a description of the representations,
warranties and enforcement mechanisms available to investors and a
description of how they differ from the representations,
warranties and enforcement mechanisms in issuances of similar
securities. The Rule applies to in-scope securities initially
rated (including preliminary ratings) on or after Sept. 26, 2011.
If applicable, the Standard & Poor's 17g-7 Disclosure Report
included in this credit rating report is available at:
http://standardandpoorsdisclosure-17g7.com
REGULATORY DISCLOSURES
Please refer to the initial rating report for any additional
regulatory disclosures that may apply to a transaction.
RATINGS AFFIRMED
Class Rating
A2 AAA (sf)
A3 AAA (sf)
A4 AAA (sf)
B AA (sf)
C A (sf)
D BBB (sf)
E BB (sf)
MIRABELA NICKEL: Appoints KordaMentha as Administrators
-------------------------------------------------------
Mirabela Nickel Limited disclosed that Martin Madden --
mmadden@kordamentha.com -- Clifford Rocke --
crocke@kordamentha.com and David Winterbottom --
dwinterbottom@kordamentha.com -- of KordaMentha have been
appointed as Joint and Several Voluntary Administrators by
resolution of the Board of Directors on Feb. 25, 2014. The
appointment of Joint and Several Voluntary Administrators is an
important and necessary mechanic in progressing the Proposed
Recapitalisation described below.
The Company continues to have the full support of the ad-hoc group
of holders of the Company's US$395.0 million 8.75% Senior
Unsecured Notes due April 15, 2018, who have entered into a
legally binding plan support agreement (PSA). The execution of the
PSA establishes a framework for the proposed recapitalisation of
the Company, subject to the satisfaction of the terms and
conditions of the PSA. The PSA is available in the 'Investors'
section of the Company's website and is also annexed to this
announcement.
It is intended that the Company's operations at the Santa Rita
Nickel mine will continue as usual during the administration. As
disclosed in the Company's press release of Dec. 24, 2013, the
Company is pursuing a reduced mining volume in 2014 and 2015 of 25
million tonnes of waste and ore per annum.
Upon the consummation of the Proposed Recapitalisation, the
Company and its subsidiaries' debt obligations, other than (i) the
Notes and any guarantees thereof and (ii) the NSD (as defined
below), will remain in place. The Proposed Recapitalisation is
contingent upon Mirabela Mineracao do Brasil Ltda. agreeing to the
continuation of credit facilities with Banco Bradesco S.A. and
Caterpillar Financial Services Corporation on terms acceptable to
the Ad-hoc Group.
At the end of the Proposed Recapitalisation process, the Company
intends to apply for its suspension on ASX to be lifted.
Pursuant to the PSA, the key terms of the Proposed
Recapitalisation include the following:
* the claims of the holders of Notes (Noteholders), including
any guarantees thereof, shall be compromised and extinguished
in exchange for their pro rata share of (i) 54.4% of the
ordinary shares of reorganized Mirabela (Mirabela Ordinary
Shares) on a fully-diluted basis (pro forma for the
conversion, following the consummation of the Proposed
Recapitalisation, of the Convertible Secured Notes described
and (ii) a US$5.0 million subordinated unsecured note with a
30-year maturity and a payable-in-kind interest rate of 1.0%
per annum;
* existing Mirabela shareholders shall not receive any
consideration in the Proposed Recapitalisation (other
than retaining a de minimis percentage of Mirabela
Ordinary Shares following the consummation of the
Proposed Recapitalisation); and
* the Company shall raise US$115.0 million of new capital
through the issuance of secured notes (Convertible
Secured Notes) convertible into Mirabela Ordinary Shares.
All Noteholders shall be given the opportunity to subscribe
to the New Capital. Upon the consummation of the Proposed
Recapitalisation, prior to the accretion of the payable-
in-kind interest described below, the Convertible Secured
Notes shall be convertible into 42.3% of Mirabela Ordinary
Shares on a fully-diluted basis.
Pursuant to the PSA, the Proposed Recapitalisation will be
effectuated pursuant to a recapitalisation and restructuring plan
to be implemented through (i) a deed of company arrangement in
Australia (Deed of Company Arrangement), which will bind all
Noteholders and shareholders, and (ii) an extrajudicial
reorganization proceeding to be filed by Mirabela Brazil before
the competent Brazilian court (Brazilian Extrajudicial
Reorganization), which will bind all Noteholders. The Brazilian
Extrajudicial Reorganization is necessary to implement the
arrangements contemplated in the PSA with respect to the Notes and
will not affect any other creditors of Mirabela Brazil.
Implementation of the Proposed Recapitalisation will be
conditional on, among other things, obtaining certain regulatory
relief from ASIC and ASX.
Pursuant to the PSA, the Company's debt obligations under the
Syndicated Note Subscription Deed dated as of Dec. 24, 2013, (NSD)
of approximately US$60.0 million (comprising US$45.0 million
principal plus capitalised interest and fees) shall be converted
into Convertible Secured Notes and shall reduce the amount of the
New Capital on a dollar-for-dollar basis. The Noteholders that
provided funding under the NSD (Lenders) will be paid a fee of
5.0% (Rollover Fee) (payable in Mirabela Ordinary Shares) of their
pro rata share of the US$60.0 million for converting their
commitment under the NSD into Convertible Secured Notes.
Additionally, pursuant to the PSA, certain members of the Ad-hoc
Group (Backstop Parties) have agreed to backstop the balance of
US$55.0 million of the New Capital in the form of a new money
investment. A new capital fee of 10.25% (New Capital Fee) (also
payable in Mirabela Ordinary Shares) will be payable to the
Backstop Parties based on such members' backstop commitments.
Upon the consummation of the Proposed Recapitalisation, the
Rollover Fee and the New Capital Fee will collectively amount to
3.3% of Mirabela Ordinary Shares on a fully-diluted basis (pro
forma for the conversion of the Convertible Secured Notes).
Pursuant to the PSA, the Convertible Secured Notes will:
* have an interest rate of 9.5% per annum, payable in-kind
on a semi-annual basis;
* have a term of 5 years; and
* be secured by a first-priority lien on all of the
collateral securing the NSD, as well as by any additional
unencumbered assets (subject to exceptions to be agreed).
The Company and the Ad-hoc Group evaluated other alternatives
before determining to proceed with the Proposed Recapitalisation,
including a sale of a controlling interest to another stakeholder
in the Company, but determined that no other alternative provided
a greater potential recovery to creditors than the Proposed
Recapitalisation.
Although the Ad-hoc Group firmly believes that the implementation
of the Proposed Recapitalisation is feasible, there is no
assurance that it will be concluded. The PSA is subject to several
termination events, including, but not limited to, (i) the failure
to achieve certain milestones relating to the Deed of Company
Arrangement and Brazilian Extrajudicial Reorganization by certain
dates, (ii) a material adverse change in the condition (financial
or otherwise), prospects, earnings, business or properties of the
Company and its subsidiaries and (iii) the failure by a Backstop
Party to honour its backstop commitment (subject to a replacement
backstop commitment being provided by another Backstop Party).
As at the date of this announcement, Mirabela has cash on hand and
on deposit of US$31.9 million and nickel concentrate inventory of
approximately 4,976 dry metric tonnes.
On Dec. 27, 2013, Mirabela entered into a short-term contract with
an international trading firm for the sale of 50% of Mirabela's
entire quantity of nickel concentrate produced from 1 January 2014
to 31 March 2014 at an estimated quantity of approximately 16,500
wet metric tonnes of nickel concentrate during Q1. The contract
expires on March 31, 2014.
About Mirabela Nickel
Mirabela Nickel Limited -- http://www.mirabela.com.au/-- is an
Australia-based mineral resource company engaged in mining,
production and sale of nickel concentrate. The Company's principal
asset is the 100%-owned Santa Rita nickel sulphide mine in Bahia,
Brazil. The Santa Rita mine is located approximately 360
kilometers south-west of Salvador and approximately six kilometers
from the town of Ipiau. The Company also has a portfolio of
prospective nickel targets in Brazil, including an underground
mineral resource at Santa Rita.
MUSICIANS CLUB: Enters Into Voluntary Administration
----------------------------------------------------
Sarah McConnell at 891 ABC Adelaide reports that the Musicians
Club has entered into voluntary administration with
Robert Brennan being appointed as administrator.
The report says staff were informed of the club's financial
position at a meeting on Feb. 24. Mr. Brennan told ABC radio that
he will actively work to trade the club out of its financial
situation.
The club will continue to trade and Robert Brennan will meet with
creditors, the report notes.
PINE HILL: Braitling Family Buys Cattle Station
-----------------------------------------------
ABC News reports a Northern Territory cattle station, 150
kilometres north of Alice Springs, has sold for an undisclosed
sum.
Pine Hill Station went into receivership in August 2013, with
insolvency company Ferrier Hodgson appointed as administrator, ABC
News relates.
The 2,700 square kilometre property was purchased by the Braitling
family, from neighbouring station Mount Doreen, the report says.
Ferrier Hodgson are also the receivers of Dnieper Station, north-
east of Alice Springs, ABC News notes.
QANTAS AIRWAYS: Labor Unions Warn of Strike Action
--------------------------------------------------
Ean Higgins and Ewin Hannan at The Australian reports that a major
union is threatening strike action after Qantas announced it will
axe 5,000 jobs over three years.
Unions also took aim at the performance of Qantas management after
chief executive Alan Joyce declared AUD252 million first half
underlying loss "unacceptable" and announced a major restructuring
of the national carrier, says The Australian.
The Australian relates that Unions will today, Feb. 28, meet
Qantas management over the job cuts, which include 1,500
management and non-operational roles and a swathe of jobs in
aircraft maintenance.
But Transport Workers Union national secretary Tony Sheldon warned
Qantas could face industrial action, the report relays.
He called on the Abbott government to meet with the airline to
find ways of avoiding the job cuts, according to The Australian.
"But if (Treasurer) Joe Hockey's not prepared to do that, then
it's industrial action that the workforce should be considering,"
Mr. Sheldon told reporters in Sydney, the report relates. "We
have the right to withdraw our labour."
Mr. Sheldon held out little hope of a favorable result from the
talks with Qantas, saying he expected Mr. Joyce would present a
fait accompli with no offer of genuine consultation, the report
adds.
As reported in the Troubled Company Reporter-Asia Pacific on
Feb. 27, 2014, The Wall Street Journal said Qantas would cut 5,000
jobs, sell airport terminal leases, and defer aircraft deliveries
as intense competition sent it to a deep loss in the fiscal first-
half. According to the report, the Australian flag carrier also
said it would scrap routes, including flights between Perth and
Singapore, and suspend new growth at the Asian arm of low-cost
offshoot Jetstar.
Qantas booked a net loss for the six months through December of
235 million Australian dollars (US$211 million), compared with a
AUD109 million profit in the same period a year earlier, the
Journal related.
About Qantas Airways
Headquartered in Sydney, Australia, Qantas Airways Limited --
http://www.qantas.com.au/-- is an Australian airline company
engaged in the operation of international and domestic air
transportation services, and the provision of time definite
freight services. Qantas is also engaged in the sale of
international and domestic holiday tours, and associated support
activities, including flight training, catering, passenger and
ground handling, and engineering and maintenance. It is
organized into four segments: Qantas, Jetstar, Qantas Holidays
and Qantas Flight Catering.
As reported in the Troubled Company Reporter-Asia Pacific on
Jan. 13, 2014, Moody's Investors Service has downgraded to Ba2
from Baa3 Qantas Airways Limited's senior unsecured rating.
Qantas' short term rating has also been downgraded to NP (Not
Prime) from P-3. This concludes the review initiated on Dec. 5,
2013, following Qantas' announcement and market update that it was
now expecting an underlying loss before tax of AUD250 to AUD300
million for the six months ended Dec. 31, 2013.
At the same time, Moody's has assigned a Corporate Family Rating
(CFR) of Ba1 to Qantas. The CFR, which is typically assigned to
non-investment grade corporates, reflects Moody's opinion on
Qantas' ability to honour its financial obligations as if it had a
single class of debt and a single consolidated legal entity
structure. The outlook for the ratings is negative.
TONIC HOMES: Melsom Robson Appointed as Administrators
------------------------------------------------------
George Aubrey Lopez and Evan Robert Verge at Melsom Robson were
appointed administrator of Tonic Homes Pty Ltd on Feb. 26, 2014.
A first meeting of the creditors of the Company will be held at
the offices of Melsom Robson, 143 Edward Street, in Perth, on
March 6, 2014 at 10:00 a.m.
=========
C H I N A
=========
CIFI HOLDINGS: Moody's Says 2013 Results Supports B1 CFR
---------------------------------------------------------
Moody's Investors Service says that CIFI Holdings (Group) Co.
Ltd's 2013 results were in line with Moody's expectation and
support its B1 corporate family rating and B2 senior unsecured
debt rating.
At the same time, CIFI's 2013 financial metrics remain appropriate
for its B1 corporate family rating.
The ratings outlook is stable.
"CIFI's strong sales reflect the success of its business model
which is focused on fast turnover," says Franco Leung, a Moody's
Assistant Vice President and Analyst.
CIFI reported a 46% year-on-year growth in revenues to RMB11.9
billion in 2013. It also reported a 61% year-on-year growth in
contracted sales to RMB15.3 billion.
The strong sales growth shows the company has benefited from the
strong demand for mass-market residential properties after the
Chinese government introduced regulatory measures to curb
speculative demand in the property market.
While achieving a high level sales growth, the company maintained
its gross profit margin, which increased slightly to 25.8% in 2013
from 23.7% in 2012.
"On the other hand, we expect CIFI's debt leverage to gradually
trend upwards as it will continue to use debt to fund its fast
expansion," adds Leung.
The high level of sales growth is pressuring CIFI to replenish its
land bank and increase its scale of development. As such, its
funding needs will increase.
The company's land payments increased to about 50-60% of its
contracted sales in 2013, up from about 30-40% on average in
recent years.
Gross debt increased to RMB13.3 billion at end-2013 from RMB8.9
billion at end-2012. Adjusted debt/capitalization rose to around
59.7% at end-2013 from 56.9% at end- 2012.
"Nevertheless, the financial risk associated with the rise in debt
leverage will be partly mitigated by its good liquidity profile,"
says Leung.
CIFI's liquidity position is sound. Its reported cash on hand of
RMB7.2 billion at end-2013 covers about 2.4x of its short-term
debt. Moody's believes that its cash balance and operating cash
flow over the next 12 months will fully cover short-term maturing
debt of RMB2.9 billion and committed land payment premiums of
around RMB3.4 billion.
The stable outlook reflects Moody's expectation that CIFI will
have adequate cash and operating cash flow to fund its current
projects.
Upward rating pressure could emerge if CIFI: (1) achieves strong
sales growth; (2) maintains solid liquidity to support sales
growth and to buffer against any downturn in the market; and (3)
maintains its financial discipline, such that adjusted
EBITDA/interest and revenue/debt trends above 3.0x and 1.1x on a
sustained basis.
On the other hand, downgrade pressure could emerge if CIFI's: (1)
sales growth or liquidity position weakens, as evidenced by a cash
balance below 10%-15% of total assets; (2) profitability
deteriorates, such that its EBITDA margin drops below 15%; or (3)
ability to service debt, or financial flexibility, decreases, as
indicated by weak interest coverage; in particular, if
EBITDA/interest falls below 2.0x.
The principal methodology used in this rating was Global
Homebuilding Industry published in March 2009.
CIFI Holdings (Group) Co. Ltd. was listed on the Hong Kong Stock
Exchange in November 2012. The company focuses on developing
residential and commercial properties, mainly in the Yangtze River
Delta Region. It has also expanded to the Pan Bohai Rim and the
Central Western Region. It owned 64 projects and had a land bank
of 7.6 million square meters attributable to the Group as of
December 31, 2013.
EVERGRANDE REAL: Share Repurchases No Impact on Moody's B1 CFR
--------------------------------------------------------------
Moody's Investor Service says that Evergrande Real Estate Group
Limited's share repurchases over the past month are credit
negative but do not have an immediate impact on its B1 corporate
family rating, B2 senior unsecured rating or stable ratings
outlook.
According to filings that Evergrande made to the Hong Kong
Exchange, between 27 January 2014 -- when the company first
announced that it would buy back its own shares -- and 25 February
2014, Evergrande repurchased 1.56 billion of its own ordinary
shares (9.7% of total outstanding shares).
"Evergrande's share buyback and its earlier purchase of Huaxia
Bank shares reduced the company's liquidity buffer by RMB7.3
billion," says Franco Leung, a Moody's Assistant Vice President
and Analyst.
Moody's says Evergrande's share buyback consumed about RMB4
billion or 9.5% of the company's reported cash balance of RMB42
billion at 30 June 2013.
In addition, on 24 January 2014, Evergrande purchased 403 million
Huaxia Bank (unrated) shares in the open market for a total
consideration of RMB3.3 billion, making Evergrande one of the
bank's top five shareholders.
But Moody's believes that Evergrande's internal resources are
adequate to meet its outstanding obligations, including its land
and construction payments in the next 12 months as the company
successfully raised $1.5 billion from bond offerings in late
October and November 2013.
"The share buyback reduces Evergrande's equity base, which in turn
raises its debt to total capitalization ratio," adds Leung.
Evergrande's total reported equity (including minority interest)
amounted to RMB58 billion at 30 June 2013. Its recent share
buybacks would have increased adjusted debt/total capitalization
by 1.8 percentage points to 65.6%.
Nonetheless, Moody's expects Evergrande's key financial metrics
over the next 12-18 months to continue positioning the company at
its current B1 corporate family rating, despite its debt leverage
being one of the highest among Moody's rated Chinese developers.
"We expect limited further share repurchases by Evergrande in the
near term, as it has nearly reached the limit it set on issued
capital," says Leung.
According to the company's annual general meeting on 6 June 2013,
total share buybacks cannot exceed 10% of issued share capital.
Based on Evergrande's share repurchase position at 21 February
2014, the company can only use another 0.3% of its issued share
capital for repurchases until its next annual general meeting.
The principal methodology used in this rating was the Global
Homebuilding Industry published in March 2009.
Evergrande Real Estate Group Limited is one of the major
residential developers in China, with a standardized operating
model.
Founded in 1996 in Guangzhou, the company has rapidly expanded its
business across the country over the past few years. At end-June
2013, it had a land bank of 145 million square meters in gross
floor area, across 140 cities in China.
GEMDALE CORP: S&P Rates Proposed RMB-Denominated Sr. Notes 'BB-'
----------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'BB-' long-term
issue rating and 'cnBB+' long-term Greater China regional scale
rating to a proposed issue of Chinese renminbi-denominated
benchmark size senior unsecured notes by Gemdale (Asia) Investment
Ltd.
Famous Commercial Ltd. (BB/Stable/--; cnBBB-/--) and five other
offshore subsidiaries of Gemdale Corp. (Gemdale: BB+/Stable/--;
cnBBB+/--) unconditionally and irrevocably guarantee the notes.
Gemdale intends to use the notes proceeds to refinance existing
debts. The ratings on the notes are subject to S&P's review of
the final issuance documentation.
The issuer credit rating on Famous is one notch below that on
Gemdale. S&P views Famous as a "highly strategic" subsidiary, but
not a "core" subsidiary, of Gemdale. Famous and Gemdale are
strategically, financially, and operationally integrated. But
Famous has a limited history of operations. In addition, Famous
is smaller in scale. It accounts for only 18% of Gemdale's total
assets and 7% of the parent's revenues.
The issue rating is one notch below the long-term credit rating on
Famous. The timeliness of the financial support from Gemdale to
Famous is uncertain because of China's controls over foreign
exchange and capital, and uncertainty relating to regulatory
approvals.
S&P do not consider a "keepwell agreement" and an undertaking for
an equity interest purchase between Gemdale and Famous as
guarantees even though the arrangements demonstrate strong parent
support. A keepwell agreement is a contract between a parent
company and its subsidiary to maintain solvency and financial
backing throughout the term set in the agreement.
The rating on Gemdale reflects the company's low asset turnover
and significant, albeit reducing, exposure to the high-end
residential property segment. Gemdale's lower profitability and
weaker financial strength than those of peers' with a similar
market position also constrain the rating. Gemdale's established
market position, geographic diversity, long record of steady
growth through market cycles support the rating, in addition, the
company has consistent financial management and good financial
flexibility.
S&P expects the company to maintain its good sales performance in
2014. Gemdale achieved contracted sales of RMB45.0 billion in
2013 and exceeded its full-year sales target of RMB40 billion by
12.5%. S&P also expects the company to maintain its consistent
financial management, with a debt-to-EBITDA ratio of below 4x over
the next 12 months.
PARKSON RETAIL: Fitch Cuts LT IDR to 'BB'; Outlook Negative
-----------------------------------------------------------
Fitch Ratings has downgraded China-based department store operator
Parkson Retail Group Limited's (Parkson) Long-Term Issuer Default
Rating (IDR) and senior unsecured rating to 'BB' from 'BB+'. The
Outlook is Negative.
The downgrade reflects the deterioration in Parkson's credit
metrics for the medium-term arising from weaker sales growth and
profitability amid a challenging operating environment. The
Negative Outlook reflects the continued pressure over the next 12-
24 months on Parkson's performance from the still-weak retail
sentiment in China, stiff competition and start-up losses for its
existing and upcoming new stores.
Key Rating Drivers
Newer Stores Underperformed. Parkson's 2H13 earnings continued to
be hurt by weak retail sentiment, the austerity drive by the
Chinese government and stiff competition from peers as well as
other retail formats. Out of the company's 57 stores, 21, which
mainly opened after 2010, have yet to break even. Parkson's gross
sales proceeds increased by just 4.3% to CNY17.48 billion in 2013,
hampered by renovation works at its flagship store in Shanghai,
while same-store sales contracted by 1.8%. Higher staff costs and
rental sent EBITDA down by 32% to CNY961 million for 2013. Fitch
expects weak retail sentiment to persist with the overall industry
registering single-digit growth in sales for 2014.
Medium-Term Profitability Squeezed: Fitch expects Parkson's
profitability to continue to come under pressure because it plans
to open 11 more new stores, increasing its total gross floor area
by 20% over the next 24 months. These new stores require at least
three years to break even while merchandise gross margin for new
stores are generally lower compared with that for mature stores.
Any recovery in profitability would be driven by Parkson's ability
to increase sales productivity across its stores, which is
challenging under current environment.
Weak Performance, Capex Delay Deleveraging: Parkson's weak
performance and higher rental obligations resulted in the sharp
deterioration of its credit metrics for 2013, even though it had
no significant new borrowings in 2H13. The company's payables
adjusted FFO net leverage rose to 5.3x at end-2013 from 3.8x a
year earlier and FFO fixed charge cover fell to 1.52x from 2x a
year earlier. The start-up losses from the new stores, about
CNY2bn of planned capex for the next two years and dividend
distribution are likely to hinder rapid deleveraging. Fitch
expects Parkson's adjusted FFO net leverage to hover at 5x in 2014
before recovering to around 4.5x in 2016.
Nationwide Presence: Parkson's well-established and geographically
diversified presence in China across 37 cities supports its
rating. Its top five stores accounted for 30% of gross sales
proceeds, compared with around 60% for rated major peers.
Parkson's low concentration risk also partly offsets the lower
sales growth at its older stores relative to its key competitors.
Healthy Liquidity: Parkson's rating is still supported by its
cash-generative concessionary model and its healthy liquidity
position. Parkson has no short-term borrowings and maintains cash
and liquid investments of CNY4.8 billion. Parkson would also be
able to support its planned capex for the next two years using
internal cash.
Management Changes Add Uncertainty: The resignations of Parkson's
CEO effective March 1, 2014 and CFO from June 30, 2013 increases
the uncertainty in terms of strategic planning and could delay the
execution of a turnaround plan. The company will be led by an
interim CEO, Chong Sui Hong, who has more than 18 years'
experience with Parkson, while it seeks to appoint a new CEO
within the next six months.
Rating Sensitivities
Negative: Future developments that may, individually or
collectively, lead to negative rating action include
-FFO adjusted net leverage sustained above 5x
-Deterioration in fixed charge coverage to below 1.5 times.
The Outlook will be revised to Stable if:
-FFO adjusted net leverage sustained below 5x
-Neutral FCF is being generated on a sustained basis
-Maintaining fixed charge coverage above 1.5 times.
=========
I N D I A
=========
ACTION ISPAT: ICRA Suspends 'D' Rating on INR957.68cr Loans
-----------------------------------------------------------
ICRA has suspended [ICRA]D rating assigned to the INR867.68 crore
term loans and INR90 crore fund based bank facilities of Action
Ispat and Power Private Limited. ICRA has also suspended the short
term rating of [ICRA]D assigned earlier to the INR20.84 crore non-
fund based faculties of AIPPL. The suspension follows ICRA's
inability to carry out a rating surveillance in the absence of the
requisite information from the company.
AJANTA INDIA: CRISIL Cuts Rating on INR316MM Loans to 'D'
---------------------------------------------------------
CRISIL has downgraded its ratings on the bank facilities of Ajanta
India Ltd to 'CRISIL D/CRISIL D' from 'CRISIL B/Stable/CRISIL A4'
because of delays in payment of term loan installments. The delays
are caused by company's weak liquidity.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Bank Guarantee 10 CRISIL D (Downgraded from
'CRISIL A4')
Cash Credit 160 CRISIL D (Downgraded from
'CRISIL B/Stable')
Letter of Credit 100 CRISIL D (Downgraded from
'CRISIL A4')
Term Loan 46 CRISIL D (Downgraded from
'CRISIL B/Stable')
AIL also has a weak financial risk profile, marked by high
gearing, modest debt protection metrics and net worth, and
volatile revenue profile. These weaknesses are partially offset by
favourable demand prospects for the compact fluorescent lamp (CFL)
industry.
AIL is engaged in manufacturing and marketing of electric lamps,
including CFLs and Light Emitting Diode (LED) lights, under the
brand 'Ajanta'.
AIL reported a profit after tax (PAT) of INR 3.1 million on net
sales of INR323.9 million for 2012-13 (refers to financial year
April 1 to March 31), as against a PAT of INR 6 million on net
sales of INR 566.5 million for 2011-12.
AL-RKAYAN APPARELS: ICRA Reaffirms 'B+' Rating on INR14.5cr Loan
----------------------------------------------------------------
ICRA has reaffirmed the long term rating of '[ICRA]B+' for
INR14.50 Cr long term fund based facilities of Al-Rkayan Apparels
& Exports Private Limited.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Cash Credit 10.00 [ICRA]B+ reaffirmed
Term Loan 4.50 [ICRA]B+ reaffirmed
The rating reaffirmation takes into account the long experience of
promoters in the denim manufacturing industry. The revenues of the
company have reported a strong growth in FY2013 and 7MFY2014, on
the back of healthy order inflows for contract manufacturing from
its existing customers and new customers. The rating also
favorably factors in the strong tie-ups of Al-Rkayan with its key
customers, which include established denim players.
The rating is, however, constrained by the leveraged capital
structure of the company due to an elongated working capital cycle
and debt funded capital expenditure, which have led to weak
interest and debt coverage indicators. The company's liquidity
position continues to be strained as illustrated by its almost-
full utilisation (95%-100%) of fund based working capital limits
during the last twelve months. The operating margins have
deteriorated in FY2013 and 7MFY2014 owing to higher input costs
and lower realizations from its in-house brand (Leonidas). The
rating is also constrained by the high volatility in cotton yarn
prices with limited ability to pass on raw material price
fluctuations for its in-house brand, as Al-Rkayan primarily caters
to a price sensitive semi-urban/rural segment. Sales and inventory
also remain exposed to macro-economic slowdown and inherent
industry risk of obsolescence owing to constantly changing fashion
trends.
Al-Rkayan was incorporated in 2004 by Mr. Prabhakar Shetty,
Mr.Shahid Rafi and Mr. Abdul Rahman S Al-Rkayan. The promoters
commenced the business with contract manufacturing for major denim
brands in the domestic market. Towards the end of 2008-09, Al-
Rkayan launched its own denim brand Leonidas, aimed at the price-
sensitive and fashion conscious youth segment (16 to 40 years age
group). Al-Rkayan has also in the current year launched two more
brands- Leslie (for capris and three-fourths) and LD Active
(bottom wear for women).
Recent Results
As per audited results for FY 2013, Al-Rkayan reported a profit
after tax (PAT) of INR0.59 crore over an operating income (OI) of
INR61.99 crore as against a PAT of INR0.50 crore on an OI of
INR32.39 crore in FY 2012. As per 7MFY 2014 results, Al-Rkayan has
reported a profit after tax (PBT) of INR0.93 crore on an operating
income of INR45.60 crore.
ARJUNA SOLVENT: ICRA Reaffirms 'C' Rating on INR29cr Loans
----------------------------------------------------------
The ratings on the INR13.00 crore, long-term loan and the INR16.00
crore long term, fund-based bank facilities of Arjuna Solvent
Extraction Private Limited has been reaffirmed at [ICRA]C. The
short term ratings on the INR2.00 crore short term non-fund based
bank facilities of ASEPL has also been reaffirmed at [ICRA]A4.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Loan 13.00 [ICRA]C reaffirmed
Long-term, fund-
based facilities 16.00 [ICRA]C reaffirmed
Short-term, non
fund based
facilities 2.00 [ICRA]A4 reaffirmed
The rating continues to reflect the stretched financial profile of
ASEPL characterised by constrained profit margins and low cash
accruals. This coupled with the low equity base and the initial
debt funded capital expenditure results in weak coverage
indicators and stretched gearing. However, the support from the
promoters in terms of regular equity infusion coupled with the
unsecured loans provides comfort to an extent. Further,
considering the loan from the promoters as quasi equity, improves
the capital structure significantly. The rating favourably factors
in the healthy growth in revenues for FY2013, driven by the
revival in demand of the company's key product, cotton seed
deoiled cake. However, ~19% of the product portfolio continues to
comprise of low margin trading revenues, thereby
constraining the profit margin.
Further, during the beginning of FY2013, the company's plant had a
fire accident resulting in a loss of raw materials and an
additional expense to undertake the repairs. The company is yet to
receive the insurance claim for the same, thereby impacting the
profit margins and liquidity profile of the company for FY2013 and
the current year. The ratings also continue to reflect the
intensely competitive nature of the industry and the single seed
dependence of the company, further increasing the risk of
cyclicality in agro climatic conditions and raw material
procurement and pricing risks. ICRA however, favourably factors in
the experience of the promoters, in the edible oil industry and in
similar lines through group companies and the strategic location
of the plant which aids in procurement of raw materials. The
company's ability to scale up revenues and benefit from economies
of scale will remain a key rating sensitivity going forward.
Arjuna Solvent Extraction Private Limited is a family run
organisation incorporated in 2008 with the commercial production
of the company commencing from June 2009. The company is engaged
in the scientific processing of cottonseed to manufacture
cottonseed oil through solvent extraction, used primarily for
human consumption. The by-products/ waste formed in the process
also find use in various commercial operations, thereby increasing
the product portfolio of the company.
Recent Results
For the twelve months period ending March 31, 2013, ASEPL reported
profit after tax (PAT) of INR0.2 crore on revenues of INR78.0
crore as against a PAT of INR0.3 crore on revenues of INR64.2
crore for the twelve months ending March 31, 2012
BABA BEARINGS: ICRA Suspends 'B+' Rating on INR4.82cr Loans
-----------------------------------------------------------
ICRA has suspended '[ICRA]B+' rating assigned to the INR4.82
Crore, long term loans & working capital facilities & [ICRA] A4
rating to the INR1.13 Crore, short term, non fund based letter of
credit and bank guarantee facilities of Baba Bearings Pvt Ltd. The
suspension follows ICRA's inability to carry out a rating
surveillance in the absence of the requisite information from the
company.
According to its suspension policy, ICRA may suspend any rating
outstanding if in its opinion there is insufficient information to
assess such rating during the surveillance exercise
BALAJI ISPAT: CRISIL Rates INR60MM Cash Credit at 'B+'
------------------------------------------------------
CRISIL has assigned its 'CRISIL B+/Stable/CRISIL A4' ratings to
the bank facilities of Balaji Ispat.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Buyer Credit Limit 25 CRISIL A4
Cash Credit 60 CRISIL B+/Stable
The ratings reflect Balaji Ispat's below-average financial risk
profile marked by weak debt protection metrics and high total
outside liabilities to tangible net worth ratio and its marginal
scale of operations in the fragmented steel industry leading to
low profitability. These rating weaknesses are partially offset by
the extensive industry experience of Balaji Ispat's partners in
the steel industry and its moderate working capital requirements.
Outlook: Stable
CRISIL believes that Balaji Ispat will continue to benefit from
its partners' extensive experience in the steel industry; however,
its financial risk profile is expected to remain constrained on
account of its weak debt protection metrics. The outlook may be
revised to 'Positive' if Balaji Ispat significantly scales up its
operations leading to higher-than-expected cash accruals while
prudently managing its working capital cycle. Conversely, the
outlook may be revised to 'Negative' if its working capital cycle
lengthens, or its revenues and profitability come under pressure.
Balaji Ispat was established in 2013 by Mr. Pawan Garg and Mr.
Satpal Goyal. It is engaged in import and trading of mild steel
scrap. It is based in Mandi Gobindgarh (Punjab).
BHAGWATI COTTON: CARE Reaffirms 'B' Rating on INR8cr Bank Loans
---------------------------------------------------------------
CARE reaffirms the rating assigned to the bank facilities of
Bhagwati Cotton Industries.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank
Facilities 8 CARE B Reaffirmed
The rating assigned by CARE is based on the capital deployed by
the partners and the financial strength of the firm at present.
The rating may undergo a change in case of withdrawal of the
capital or the unsecured loans brought by the partners in addition
to the financial performance and other relevant factors.
Rating Rationale
The rating assigned to the bank facilities of Bhagwati Cotton
Industries continues to remain constrained on account of the weak
financial risk profile marked by thin profit margins, low cash
accruals and leveraged capital structure. The rating is further
constrained on account of its presence in a highly competitive and
fragmented cotton ginning industry with limited value addition,
volatility associated with the raw material (cotton) prices and
susceptibility to changes in the government policy for cotton.
The rating continues to derive benefits from the wide experience
of the partners in the cotton ginning business and its proximity
to the cotton-producing region of Gujarat. The rating factors in
an increase in the operating income during FY13 (refers to the
period April 1 to March 31).
BCI's ability to move upward in the textile value chain along with
improvement in profit margins, capital structure and debt coverage
indicators remain the key rating sensitivities.
BCI was established in 2004 as a partnership firm. Currently there
are seven partners who has unequal holding in the firm. Mr Pravin
J Jiyani, Managing Partner, is actively involved in the business
and manages the routine operations of the firm. BCI is engaged in
cotton ginning and pressing and has an installed capacity of 7,000
Metric Tonnes Per Annum (MTPA) for cotton bales and 12,500 MTPA
for cotton seeds as on March 31, 2013 at its sole manufacturing
facility located at Amreli (Gujarat).
During FY13, BCI reported a total operating income of INR61.34
crore (FY12: INR51.63 crore) and a PAT of INR0.08 crore (FY12:
INR0.05 crore). As per the provisional results of 9MFY14, BCI
achieved a turnover of INR36.92 crore and a PBDT of INR0.56 crore.
BHAGWATI SPONGE: CRISIL Reaffirms 'B+' Rating on INR219MM Loans
---------------------------------------------------------------
CRISIL's ratings on the bank facilities of Bhagwati Sponge Pvt Ltd
(BSPL; part of the AIC group) continue to reflect the AIC group's
large working capital requirements and low profitability, leading
to weak debt protection metrics. The ratings also factor in the
group's exposure to project implementation risk, particularly in
BSPL, over the medium term. These rating weaknesses are partially
offset by the benefits that AIC group derives from its partly
integrated operations, its diverse revenue profile and promoter's
extensive experience in the steel industry.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 195 CRISIL B+/Stable (Reaffirmed)
Letter of Credit 47 CRISIL A4 (Reaffirmed)
Term Loan 24 CRISIL B+/Stable (Reaffirmed)
For arriving at the ratings, CRISIL has combined the business and
financial risk profile of BSPL, AIC Steel Pvt Ltd (ASPL), AIC Iron
Industries Pvt Ltd (AIIPL), and AIC Casting Pvt Ltd (ACPL),
together referred to as the AIC group. This is because there are
operational and financial linkages among these companies. ASPL
supplies pig iron to the other companies. BSPL manufactures sponge
iron, which is the key raw material for the steel ingots/billets
manufactured by AIIPL, and hence, results in backward integration.
Furthermore, all the companies are under a common management and
they extend need-based financial support to each other.
Outlook: Stable
CRISIL believes that the AIC group will continue to maintain its
business risk profile over the medium term, backed by its diverse
revenue profile and its promoter's extensive experience in the
steel industry. However, its financial risk profile is expected to
remain constrained, with weak debt protection metrics, because of
low profitability. The outlook may be revised to 'Positive' in
case of more-than-expected increase in the group's cash accruals,
or better working capital management, leading to improvement in
its overall financial risk profile, especially its liquidity.
Conversely, the outlook may be revised to 'Negative' in case of
deterioration in the AIC group's working capital management, or
lower-than-expected accruals leading to deterioration in the
group's financial risk profile, particularly its liquidity.
The AIC group is involved in trading in and manufacturing steel
intermediaries. ASPL trades in pig iron and scrap. BSPL
manufactures sponge iron, while AIIPL manufacturers steel ingots.
This results in partly integrated operations for the group, as
sponge iron is the key raw material for ingot manufacturing. ACPL
is engaged in grey iron casting. ACPL's product profile includes
gear boxes, electric motor bodies, and manhole covers, among other
products.
COASTAL CONSOLIDATED: CRISIL Cuts Rating on INR130MM Loan to B-
---------------------------------------------------------------
CRISIL has downgraded its rating on the long-term bank loan
facilities of Coastal Consolidated Structures Pvt Ltd (CCSPL) to
'CRISIL B-/Stable' from 'CRISIL B+/Stable', and has reaffirmed its
rating on the company's short-term facilities at 'CRISIL A4'.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Bank Guarantee 330 CRISIL A4 (Reaffirmed)
Cash Credit 130 CRISIL B-/Stable (Downgraded
from 'CRISIL B+/Stable')
The rating revision reflects CRISIL's belief that CCSPL's
liquidity will remain under pressure over the medium term on
account of large annual debt repayments of INR10 million, against
low accruals due to decline in revenues and higher working capital
costs. The ability of the company to reduce its cash cycle, and
timely funding support from its promoters to bridge the cash flow
mismatches, will remain key rating sensitivity factors over the
medium term.
The ratings reflect CCSPL's below-average financial risk profile,
marked by a small net worth, limiting its financial flexibility,
and stretched liquidity. The ratings also factor in its large
working capital requirements, and its exposure to intense
competition in the civil construction industry. These rating
weaknesses are partially offset by the extensive industry
experience of the company's promoters.
Outlook: Stable
CRISIL believes that CCSPL's liquidity will remain constrained
over the medium term on account of high repayment obligations and
large working capital requirements. The outlook may be revised to
'Positive' if the company improves its accruals and its cash cycle
or there is large equity infusion, leading to improvement in its
liquidity. Conversely, the outlook may be revised to 'Negative' if
CCSPL's business volumes reduce, or if there are delays in project
execution, or a further stretch in its receivables.
CCSPL, established by Mr. M V Ranga Prasad and his family
undertakes civil works such as construction of concrete
foundations, pile caps, industrial buildings, culverts, and
reservoirs, as well as site grading, site development, and hard
rock excavation; it also undertakes marine works such as
construction of berths, pile foundation, diaphragm walls, and
breakwaters. CCSPL is headquartered in Vijayawada (Andhra
Pradesh).
CCSPL's net profit and net sales for 2012-13 (refers to financial
year, April 1 to March 31) were INR6.7 million and INR130 million,
respectively, against a net profit of INR14 million on net sales
of INR497 million for 2011-12.
DHURIA RICE: ICRA Reaffirms 'B' Rating on INR6cr Cash Credit
------------------------------------------------------------
ICRA has reaffirmed the long term rating of '[ICRA]B' to the
INR6.00 crores fund based bank facilities of Dhuria rice Mills.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Fund Based Limits-
Cash Credit 6.00 [ICRA]B reaffirmed
The reaffirmation of rating takes into account high gearing
arising out of large working capital funding which in turn has
resulted in weak coverage indicators. The rating also takes into
account high intensity of competition in the rice milling industry
and agro climatic risks, which can affect the availability of
paddy in adverse weather conditions. The rating however, favorably
takes into account long standing experience of promoters, good
demand supply dynamics in the basmati rice industry and proximity
of the mill to major rice growing area which results in easy
availability of paddy.
Recent Results:
DRM reported a net profit of INR0.06 crores on an operating income
of INR17.39 crores for the year ended March 31, 2013 and a net
profit of INR0.03 crores on an operating income of INR12.68 crores
for the year ended March 31, 2012.
Dhuria Rice Mills was established in the year 1978 as a
partnership firm with Ashok Kumar, Krishna Devi & Surinder Kumar
as partners. In the year 2007 partnership was re constituted with
Mr Arun Kumar, Mr Ashok Kumar and Krishna Devi as partners. In
2012 the partnership firm was reconstituted again with Mr. Ashok
Kumar & Mr. Arun Kumar as partners in equal ratios. All the
partners are actively engaged in the management of the company.
DRM is engaged in processing and trading of rice. Head office as
well as the manufacturing plant of the company is located at
Fazilka, Punjab.
ELTEL POWER: ICRA Reaffirms 'B' Rating on INR62cr Loans
-------------------------------------------------------
ICRA has reaffirmed the long term rating assigned to for INR62.00
crore bank facilities of Eltel Power Private Limited at [ICRA]B.
ICRA has also reaffirmed the short term rating assigned to INR8.00
crore bank facilities of EPPL at [ICRA]A4.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-Term Fund 7.00 [ICRA]B Reaffirmed
Based Facilities
Long-Term Non- 55.00 [ICRA]B Reaffirmed
Fund Based
Facilities
Short-Term Non- 8.00 [ICRA]A4 Reaffirmed
Fund Based
Facilities
The rating reaffirmation continues to take into account the
company's modest scale of operations which is due to delay in
project execution and its stretched liquidity position on account
of high capital intensity operations. While the order book
position of the company was satisfactory at ~INR130 crore as on
Mar-13 of which around 87% was proposed to be executed by Oct-14
and remaining 13% by Feb-15; however during 9M'FY-14 the company
executed only INR18.8 crore of the orders representing ~14% of the
order book of Mar-13. The slow pace of order execution has not
only kept the Operating Income (OI) modest but has also restricted
its ability to bid for the fresh orders due to limited financial
flexibility as its Non Fund Based (NFB) limits remain highly
utilised for the existing orders. In addition to the modest scale
of operations, the liquidity of the company has remained stretched
on account of capital intensive nature of operations, given the
long receivable cycle, high levels of un-billed inventory and
margin funding requirement for various bank guarantees issued by
the company. While customer advances has funded a large proportion
of capital requirement, low internal accruals and paid up capital
has kept the dependence on external funding high which has been
met though working capital limits which has consistently remained
fully utilized, trade financing from suppliers through extended
credit period and unsecured loans from promoters. The assigned
continues to remain constrained by the company's weak financial
profile, given the modest profitability and leverage capital
structure with TOL/TNW of 5.9 times and also high customer and
regional concentration with all the orders being from one customer
- Madhya Pradesh Poorv Kshetriya Vidyut Vitaran Company Limited
(MPPKVCL) in Madhya Pradesh though the counterparty credit risk
remains low as the client is a Government entity. Nevertheless,
the rating continues to positively factor in the long track record
of Eltel group in executing projects relating to electrical
contracts in Madhya Pradesh (MP).
Going forward, the ability of the company to successfully execute
the existing orders in a time bound manner, scale up its
operations by successfully securing fresh orders while improving
its liquidity position and maintain healthy profitability will
remain the key rating sensitivities.
Established in March-2011 by Mr. V.K. Agarwal in Satna district
(Madhya Pradesh), Eltel Power Private Limited (EPPL) is engaged in
erection and installation of power transmission infrastructure
projects on turnkey basis. The firm is catering to customers such
as Madhya Pradesh Purvi Kshetra Vidyut Vitaran Company Limited
(MPPKVCL) and Madhya Pradesh Road Development Corporation Limited
(MPRDCL).
During FY-2013, the company reported Profit After Tax (PAT) of
INR0.73 crore with an Operating Income (OI) of INR21.3 core as
compared to PAT of INR0.01 crore with an OI of INR6.2 crore for
the previous financial year. As per the provisional results for
the nine months ended December 31, 2013, the company reported
Profit Before Tax (PBT) of INR1.13 crore with an Operating Income
of INR18.8 crore.
GAJANAND RICE: ICRA Assigns 'B' Rating to INR8cr Loans
------------------------------------------------------
ICRA has assigned an '[ICRA]B' rating to the INR5.00 crore cash
credit facility , INR0.90 crore term loan facility and INR2.10
crore proposed limits of Gajanand Rice Mills.
The assigned rating is constrained by the small scale of
operations and weak financial profile of the firm reflected in low
profit margins, stretched capital structure and modest coverage
indicators. The rating also takes into account the inherently low
value addition in the rice milling business; the highly fragmented
nature of the industry and vulnerability of profit margins to
volatility in paddy prices which are in turn a function of
seasonality and variations in crop harvests and regulatory risks.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long term fund
based-Cash Credit 5.00 [ICRA]B assigned
Long term fund
based-Term loan 0.90 [ICRA]B assigned
Long term fund
based-Proposed
Limits 2.10 [ICRA]B assigned
The assigned rating, however, favourably factors in the long
experience of the promoters in the rice milling and trading
business, favourable location of the firm's manufacturing unit in
close proximity to the paddy belt in Gujarat and favourable
outlook for rice realisations following the lifting of the export
ban from September 2011.
Established in 1982, Gajanand Rice Mill(GRM) is engaged in
processing, milling and polishing of non-basmati rice as well as
trading of product mix consisting of rice bran and rice. The firm
operates from its unit located at Sanand (Gujarat); with an
installed capacity of 215 metric tonnes per month for rice, 25
metric tonnes per month for broken rice and 58 metric tonnes per
month for rice bran.
GIRIJA MODERN: CRISIL Cuts Rating on INR290MM Loans to 'B+'
-----------------------------------------------------------
CRISIL has downgraded its ratings on the bank facilities of
Girija Modern Rice Mill (Girija Mill; part of the Pallavi group)
to 'CRISIL B+/Negative/CRISIL A4' from 'CRISIL BB+/Stable/CRISIL
A4+'.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 140 CRISIL B+/Negative (Downgraded
from 'CRISIL BB+/Stable')
Export Packing 50 CRISIL A4 (Downgraded from
Credit 'CRISIL A4+')
Long Term Loan 100 CRISIL B+/Negative (Downgraded
from 'CRISIL BB+/Stable')
Warehouse Receipts 50 CRISIL B+/Negative (Downgraded
from 'CRISIL BB+/Stable')
The rating downgrade reflects the deterioration in the Pallavi
group's liquidity, with its continued large working capital
requirements resulting in full utilisation of its bank limits.
CRISIL believes that the Pallavi group will need fresh capital
from its promoters, or will have to register a sustained
improvement in its working capital cycle, to alleviate the
pressure on its liquidity. The downgrade also factors in the
expected disruption in the group's operations on account of the
ongoing agitation against it by farmers.
The ratings reflect the Pallavi group's large working capital
requirements, and susceptibility of its profitability margins to
regulatory changes, if any, and to shortage of paddy. These rating
weaknesses are partially offset by the group's assured offtake by
Food Corporation of India.
For arriving at its ratings, CRISIL has combined the business and
financial risk profiles of Girija Mill and Pallavi Enterprises.
This is because these two entities, together referred to as the
Pallavi group, have common promoters, are in the same line of
business, and have operational linkages and fungible cash flows.
Outlook: Negative
CRISIL believes that the Pallavi group's liquidity will remain
constrained over the medium term on account of its large working
capital requirements and muted profitability levels. The rating
may be downgraded if there is a steep decline in the group's
profitability margins, or in case of significant deterioration in
its capital structure most likely because of larger-than-expected
working capital requirements. Conversely, the outlook may be
revised to 'Stable' if there is an improvement in the Pallavi
group's liquidity on the back of infusion of funds by its
promoters, or in case of sustained improvement in its working
capital management.
Pallavi Enterprises was set up in 1983 by Mr. Tatikonda
Viswanadham and his wife. Girija Mill was set up in 2007 by Mr.
Viswanadham and his daughter. Both the firms mill and process
paddy into rice; they also generate by-products such as broken
rice, bran, and husk. Both the firms are located at Enikepadu in
Vijayawada (Andhra Pradesh).
GROVER IMPEX: ICRA Reaffirms 'B+' Rating on INR2cr Loans
--------------------------------------------------------
ICRA has reaffirmed '[ICRA]B+' rating to the INR2.00 crore fund
based limits and '[ICRA]A4' rating to the INR6.50 crore non fund
based limits of Grover Impex Private Limited.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Fund based limits 2.00 [ICRA]B+ reaffirmed
Non Fund Based
Limits 6.50 [ICRA]A4 reaffirmed
The rating reaffirmation take into account the company's modest
scale of operations, low profitability, moderate gearing levels
and modest debt coverage indicators. The ratings further take into
account the high competitive intensity in trading business
resulting from low entry barriers, exposure of company's
profitability to adverse regulatory changes particularly those
related to exports and incentives and fluctuations in availability
and prices of traded goods which are in turn linked to seasonality
and crop harvest. The ratings however positively consider the
experience of the promoters in agro commodities trading, steady
growth in operating income of the company driven by its wide range
of traded goods. Going forward, ability of the company to increase
its scale of operations in a profitable manner while maintaining
the working capital intensity will be the key rating
sensitivities.
Grover Impex Private Ltd is promoted by Mr. Deepak Daing and Mr
Pawan Kumar Jain who are actively involved in the business. The
company was established in the year 1982 as Grover Tankers Pvt Ltd
and was engaged in transportation of edible oils. In 2008 the
company started trading in agro commodities. GIPL imports agro
commodities from countries such as Indonesia, Vietnam, China etc
and sells it primarily in the domestic market.
Recent Results
The company reported a net profit of INR0.20 crores on an
operating income of INR27.21 crores in FY13 as against net profit
of INR0.12 crores on an operating income of INR10.61 crores in
FY12.
GSP INTERNATIONAL: ICRA Cuts Rating on INR20cr Loans to 'B'
-----------------------------------------------------------
ICRA has revised the long-term rating assigned to the INR20.00
crore fund based bank facility of GSP International from [ICRA]B-
to [ICRA]B. ICRA has also reaffirmed the short-term rating of
[ICRA]A4 to the INR25.00 crore non-fund based bank facility of the
firm.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Fund
Based Limit-
Cash Credit 20.00 [ICRA]B Revised from
[ICRA]B
Short Term Non
Fund Based Limit-
Letter of Credit 25.00 [ICRA]A4 Reaffirmed
The revision in rating reflects GSP's improvement in profit
margins and the decrease in gearing levels following infusion of
capital although the gearing is still high in absolute terms.
However, the ratings continue to be constrained by the weak
coverage indicators of the firm and the vulnerability of its
profitability to foreign exchange fluctuations, fluctuations in
steel scrap prices as well as competitive pressure in the
industry. Further, GSP is a proprietorship firm and any
significant withdrawals from the capital account would affect its
capital structure. ICRA also notes that GSP has significant
intercompany transactions in the form of investments to and from
group concerns, which impact its financial flexibility.
The ratings also continue to favorably factor in the established
track record of the promoter in the ferrous and non-ferrous metal
scrap industry as well as the moderately diversified clientele.
GSP International, incorporated in the year 1997 as a
proprietorship concern by Mr. Arun Jain is engaged in the trading
of ferrous and non-ferrous scrap items. The firm has its warehouse
at Navi Mumbai and its registered office at Mumbai.
Recent Results
GSP recorded a net profit of INR0.95 crore on an operating income
of INR108.49 crore for the year ending March 31, 2013. For the ten
months ended January 31, 2013, the firm recorded a pre-tax profit
of INR0.66 crore on an operating income of INR60.17 crore
(Provisional numbers).
JANKI DASS: ICRA Assigns 'B' Rating to INR15cr Loans
----------------------------------------------------
ICRA has assigned the long term rating of [ICRA]B to the INR2.50
crores & short term rating of [ICRA]A4 to the INR22.50 crores fund
based bank facilities of Janki Dass Rice Mills. Additionally ICRA
has an outstanding long term rating of [ICRA]B to INR12.50 crores
& short term rating of [ICRA]A4 to INR22.50 crores fund based
limits of Janki Dass Rice Mills.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Fund
Based Limits 15.00 [ICRA]B assigned
Short Term Fund
Based Limits 45.00 [ICRA]A4 assigned
The rating assigned is constrained by high gearing arising out of
substantial debt funding of large working capital requirements,
high intensity of competition in the rice milling industry and
agro climatic risks, which can affect the availability of paddy in
adverse weather conditions. The rating however, favorably takes
into account good demand supply dynamics in the basmati rice
industry provide ample growth opportunities for the company, long
standing experience of promoters with long standing relationships
with several customers and suppliers and proximity of the mill to
major rice growing area which results in easy availability of
paddy.
Recent Results:
JRGM reported a net profit of INR3.11 crores on an operating
income of INR160.37 crores for the year ended March 31, 2013 and a
net profit of INR0.60 crores on an operating income of INR91.04
crores for the year ended March 31, 2012.
Business was established in the year 1986 as Partnership Firm.
Partners of the firm are Mrs. Sushila Devi, Mr Rajesh Kumar and
Mr. Ravinder Kumar. As per the management milling capacity of the
plant is 12 tonnes/hr of paddy. Janki Dass Rice Mills is engaged
in the business of processing and trading of Basmati Rice in
domestic market as well as exporting to countries in Middle East.
Company is having its manufacturing unit at Nandana Road, Taraori,
Karnal.
JAY METAL: ICRA Assigns 'B' Rating to INR5.35cr Loans
-----------------------------------------------------
The rating of '[ICRA]B' has been assigned to the INR2.50 crore
cash credit facility and INR2.50 crore term loan facility of Jay
Metal. The rating of [ICRA]A4 has also been assigned to the
INR0.18 crore short-term non-fund based limit (sublimit of term
loan facility) of JM.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Cash Credit 2.50 [ICRA]B assigned
Term Loan 2.85 [ICRA]B assigned
Non-fund Based,
Short-term facility (0.18) [ICRA]A4 assigned
The assigned ratings are constrained by JM's small scale of
operations with limited track record; further, the financial
profile of the firm is expected to remain stretched in the near
term on account of predominantly debt funded nature of the project
and working capital intensive nature of operations. The ratings
are further constrained by the vulnerability of firm's
profitability to fluctuations in raw material prices, though
partly mitigated by procurement of raw materials against firm
orders. The ratings also take into account the competitive
pressures from a large number of players, including established
players in the industry. ICRA also notes that as JM is a
partnership firm, any significant withdrawals from the capital
account by the partners would adversely affect its net worth and
thereby its capital structure; this remains a key rating
sensitivity.
The ratings, however, favourably take into account the long
standing experience of the promoters in the casting industry and
the locational advantage available to the firm due to its
proximity to raw material sources and customers.
Jay Metal (JM) is a partnership firm engaged in manufacturing of
cylinder liners and sleeves using centrifugal casting process. The
firm's manufacturing facility is located at Shapar, Rajkot in
Gujarat and has an installed capacity for manufacturing nine lakh
pieces of cylinder liners per annum. The firm also has an in-house
machining centre which consists of two CNC machines. The firm
started commercial production from July 22, 2013 and is promoted
by Mr. Vinod Sakhiya and Mr. Sanjay Sakhiya, who have more than a
decade of experience in the cylinder liners business.
JUGAL KISHORE: CRISIL Reaffirms B+ Rating on INR19MM Loan
---------------------------------------------------------
CRISIL's ratings on the bank facilities of Jugal Kishore Kashmiri
Lal (JKKL; part of the Jugal Kishor group) continue to reflect the
Jugal Kishor group's average financial risk profile, constrained
by low cash accruals; and moderate business risk profile,
constrained by its working-capital-intensive operations. These
rating weaknesses are partially offset by the extensive experience
of the Jugal Kishor group's promoters in the timber trading
industry and their funding support.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 19 CRISIL B+/Stable (Reaffirmed)
Letter of Credit 100 CRISIL A4 (Reaffirmed)
For arriving at the ratings, CRISIL has combined the business and
financial risk profiles of JKKL and Sadhu Ram Jai Parkash (SRJP),
together referred to as the Jugal Kishor group. This is because
both the entities are in the same line of business and are managed
by common promoters. Also, CRISIL has treated unsecured loans of
INR67.7 million, extended by the group's promoters, as neither
debt nor equity as the same are expected to remain in the business
over a long term.
Outlook: Stable
CRISIL believes that the Jugal Kishor group will continue to
benefit from its promoters' extensive industry experience, over
the medium term. The outlook may be revised to 'Positive' in case
of a significant improvement in the group's financial risk
profile, including its liquidity, most likely because of
improvement in cash accruals and working capital cycle.
Conversely, the outlook may be revised to 'Negative' in case the
group's lower-than-expected cash accruals or larger-than-expected
working capital requirements cause its liquidity to deteriorate.
Update
The Jugal Kishor group reported a marginal growth in its revenue,
as reflected in net sales of INR639.5 million for 2012-13 (refers
financial year, April 1 to March 31) against INR568.9 million for
2011-12. The group's operating margin was stable at around 2.1 per
cent. Also, the group continued to have stretched working capital
management, with gross current assets of around 180 days for 2012-
13. In the absence of sufficient cash accruals and a small net
worth, the group continued its dependence on bank debt and funding
support from promoters in the form of unsecured loans. The total
quantum of unsecured loans stood at INR67.7 million as on March
31, 2013, as compared to INR62.5 million as on March 31, 2012.
The Jugal Kishor group's net worth was also small at INR13.3
million as on March 31, 2013, thereby limiting its financial
flexibility to meet any exigency. The group has high debt levels
towards funding its working capital requirements; these, along
with small net worth, is estimated to result in a high total
outside liabilities to tangible net worth ratio of around 18 times
as on March 31, 2013.
The Jugal Kishor group started operations in 1992 in Jind
(Haryana), with processing facilities located in Gandhidham
(Gujarat). Presently, the group operates two entities, SRJP and
JKKL, and is engaged in processing and trading in timber, mainly
hard wood. The group is managed by Mr. Rakesh Goel, Mr. Raja
Kumar, Mr. Ved Prakash, and Mr. Akshay Kumar.
LA CASA: CRISIL Reaffirms 'B' Rating on INR85MM Loans
-----------------------------------------------------
CRISIL's rating on the long term bank facilities of La Casa De
Joaillier Pvt Ltd continues to reflect the company's below-average
financial risk profile marked by its small net worth, high total
outside liabilities to tangible net worth ratio and below-average
debt protection metrics. The rating also factors in the company's
modest scale of operations, geographic concentration in its
revenue profile, and its susceptibility to intense competition in
the jewellery business. These rating weaknesses are partially
offset by the extensive experience of La Casa's promoter in the
jewellery business.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 63.3 CRISIL B/Stable (Reaffirmed)
Proposed Long Term
Bank Loan Facility 21.7 CRISIL B/Stable (Reaffirmed)
Outlook: Stable
CRISIL believes that La Casa will continue to benefit over the
medium term from its promoter's extensive experience in the
jewellery business. The outlook may be revised to 'Positive' if
there is a substantial and sustained improvement in the company's
scale of operations, while maintaining its profitability margins,
or there is substantial increase in its net worth on the back of
equity infusion from promoters. Conversely, the outlook may be
revised to 'Negative' if there is there is a steep decline in the
company's profitability margins or there is a significant
deterioration in its capital structure on account of larger-than-
expected working capital requirements.
About the Company
La Casa, set up in 2007 by Ms. Bina Goenka, is engaged in
manufacturing and retailing of diamond-studded and gold jewellery.
It has one manufacturing unit and a boutique showroom in Mumbai.
LAKDA DAL: CARE Reaffirms 'B+' Rating on INR5.25cr Bank Loans
-------------------------------------------------------------
CARE reaffirms the rating assigned to the bank facilities of
Lakda Dal and Besan Utpadan Kendra.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank
Facilities 5.25 CARE B+ Reaffirmed
The rating assigned by CARE is based on the capital deployed by
the partners and the financial strength of the firm at present.
The rating may undergo a change in case of withdrawal of the
capital or the unsecured loans brought in by the partners in
addition to the financial performance and other relevant factors.
Rating Rationale
The rating continues to remain constrained on account of the weak
financial risk profile of Lakda Dal & Besan Utpadan Kendra (LAKDA)
marked by thin profitability, leveraged capital structure
and moderately stressed liquidity position. The rating is further
constrained due to its presence in a highly fragmented industry,
its constitution as a partnership concern and vulnerability of
margins due to fluctuation in the prices of raw materials.
The rating, however, continues to derive strength from the
experienced management in the food processing industry, its
established track record of operations and marketing network with
consistent growth in the Total Operating Income (TOI).
The ability of the firm to improve its overall financial risk
profile with an increase in the scale of operations is the key
rating sensitivity.
Jaipur-based (Rajasthan) Lakda was initially formed in 1992 as a
partnership firm by the Badaya family. Later in April 2003, the
exiting partners resigned from the firm due to a split in the
Badaya family and Mrs Krishna Devi Badaya along with her son, Mr
Ankit Badaya joined the firm as new partners.
Lakda is engaged in the business of processing of chana
(chickpea), wheat and matar dal to produce gram dal, gram flour,
wheat flour, matar flour and also manufactures cattle feed. The
plant of the firm is located at Jaipur. It sells gram dal, gram
flour, wheat flour and matar flour under the brand name of 'Lakda
Ji', 'Metro', 'Aravli' and '555' and cattle feed under the name of
'Godev' and 'Kesariya'.
During FY13 (refers to the period April 01 to March 31), Lakda
reported a total income of INR54.05 crore (FY12: INR49.05 crore),
with a PAT of INR0.04 crore (FY12: INR0.08 crore).
LEKH RAJ: CRISIL Assigns 'B' Rating to INR80MM Loan
---------------------------------------------------
CRISIL has assigned its 'CRISIL B/Stable' rating to the long-term
bank facilities of Lekh Raj Motors Pvt Ltd.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Inventory Funding
Facility 80 CRISIL B/Stable
The rating reflects LRM's weak financial risk profile, marked by a
high total outside liabilities to tangible net worth ratio and
average interest coverage ratio. The rating also factors in the
company's susceptibility to risks relating to intense competition
in the automobile (auto) dealership market and limited bargaining
power with its principal, General Motors India Pvt Ltd (General
Motors). These rating weaknesses are partially offset by the
benefits that LRM derives from its association with General
Motors, and efficient working capital management.
Outlook: Stable
CRISIL believes that LRM will continue to benefit over the medium
term from its association with General Motors and the extensive
experience of its promoters in the auto dealership industry. The
outlook may be revised to 'Positive' if the company generates
better-than-expected cash accruals and improves its capital
structure, leading to an improvement in its financial risk
profile. Conversely, the outlook may be revised to 'Negative' if
LRM reports lower-than-expected cash accruals, or undertakes any
large debt-funded capital expenditure programme, thereby adversely
impacting its financial risk profile.
LRM was incorporated in 2011 by Mr. Krishan Miglani and Mr. Varun
Miglani. The company is an authorised dealer for General Motors.
It operates a showroom in Kaithal and an extention office in Jind
(both in Haryana).
MACHINO AUTO: ICRA Cuts Rating on INR40.7cr Loans to 'D'
--------------------------------------------------------
ICRA has revised the ratings for INR40.7 crore bank facilities of
Machino Auto Comp Limited to '[ICRA]D' from [ICRA]BB- with stable
outlook/[ICRA]A4. The revision in ratings takes into account the
delays in debt servicing by the company due to losses at operating
level and deterioration in liquidity profile.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Term Loans 28.7 Revised to [ICRA]D from
[ICRA]BB-(Stable)
Cash Credit
Facilities 3.0 Revised to [ICRA]D from
[ICRA]BB-(Stable)
Bank Guarantee
Facilities 0.5 Revised to [ICRA]D from
[ICRA]A4
Letter of Credit
Facilities 1.4 Revised to [ICRA]D from
[ICRA]A4
Unallocated 7.1 Revised to [ICRA]D/[ICRA]D
from [ICRA]BB-(Stable)/[ICRA]A4
Recent Results
In 2012-13, MACL reported Operating Income (OI) of INR37.8 Crore
with net loss of INR7.7 Crore as compared to OI of INR55.7 Crore
and net loss of INR0.2 Crore in 2011-12.
MACL is a plastic mouldings manufacturer for automotive
applications with its manufacturing facility situated at Chakan,
near Pune (Maharashtra). The company's manufacturing facility
became operational in January, 2011 and is situated in close
proximity to that of its primary customer Volkswagen. MACL's
product profile consists mostly of interior and underbody parts
like front frame carrier, exterior trims, under-body panels, etc.
Incorporated in 2008, MACL is a part of Machino group of
companies. The group has presence in various businesses like
mixing of polypropylene compounds, manufacture of moulded plastic
components, vehicle dealership, investments into real estate etc.
Major companies in the group are Machino Polymers Limited (rated
[ICRA]BBB+/Negative/[ICRA]A2) engaged in the manufacture of
polypropylene compounds and Machino Plastic Limited which
manufactures injection moulded plastic components like instrument
panels, front grills etc.
MALU PAPER: ICRA Upgrades Rating on INR88cr Loans to 'C'
--------------------------------------------------------
ICRA has upgraded the long term rating from [ICRA]D to [ICRA]C
assigned to the INR63.25 crore (reduced from INR74.29 crore) term
loans and INR24.75 crore fund based facilities and the short term
rating from [ICRA]D to [ICRA]A4 assigned to the INR14.20 crore
non-fund based limits of Malu Paper Mills Limited.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Term Loans 63.25 [ICRA]C upgraded
Fund Based Limits 24.75 [ICRA]C upgraded
Non-Fund Based
Limits 14.20 [ICRA]A4 upgraded
The upgrade of ratings takes into account the healthy revenue
growth seen in the current year resulting in improved
profitability levels and timely debt servicing since commencement
of debt repayments from June 2012 as per the terms of the CDR
package. Further the ratings favourably factor in the longstanding
experience of the promoters in the business, the healthy plant
capacity utilisation levels and the presence of a captive power
plant for the newsprint manufacturing unit which provides power
supply reliability.
The ratings, however, continue to remain constrained due to the
weak financial profile of the company with significant erosion of
net worth due to losses in past years, highly leveraged capital
structure with gearing of 12.97 times as on March 2013 and a
stretched liquidity position. The ratings are further constrained
by the cyclical nature of the newsprint industry and vulnerability
of the company's profitability to price fluctuations of waste
paper and international newsprint paper. ICRA notes that
significant improvement in the company's financial position in the
near to medium term would remain critical as its debt repayments
would increase subsequently, given the ballooning structure of the
repayment schedule.
Malu Paper Mills Limited, the flagship company of Malu group, was
incorporated on Jan. 11, 1994 as Malu Solvex Ltd. Subsequently the
name of the company was changed to Malu Paper Mills Ltd. with
effect from 24th April 1998. The company is involved in the
manufacture of kraft paper, newsprint paper and writing & printing
paper and has plants located in Saoner-Taluka district, in the
state of Maharashtra. The first paper machine of the company was
commissioned for commercial production in 1996 with a capacity to
produce 5,940 TPA of kraft paper which was later upgraded to 8,250
TPA. MPML set up another unit at the same location to produce
19,800 TPA of newsprint in 2001 and later modified the same for
production of kraft paper from FY 2011. The capacity of the unit
has been further expanded to 26,400 TPA. The company also setup a
new plant of 49,500 TPA for production of newsprint and writing &
printing paper, along with captive power generation capacity of 6
MW, in the nearby area for which the equity requirement was met
through company's Initial Public Offer (IPO) issued in March 2006
raising proceeds of about INR20 crore. The plant commenced
operations on 10th March 2008.
During FY 2013, the company reported net losses of INR12.42 crore
on an operating income of INR179.98 crore. During 9m FY 2014, the
company has reported net profit of INR0.15 crore on an operating
income of INR164.09 crore.
MANGALAM TIMBER: CARE Assigns 'B+' Rating to INR12.28cr Loans
-------------------------------------------------------------
CARE assigns 'CARE B+' and 'CARE A4' rating to bank facilities of
Mangalam Timber Products Ltd.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Bank
Facility (Term Loan) 0.28 'CARE B+' Assigned
Long Term Bank
Facility
(Fund based) 12.00 'CARE B+' Assigned
Short Term Bank
Facility (Non
Fund based) 6.08 'CARE A4' Assigned
Rating Rationale
.
The ratings assigned to the bank facilities of Mangalam Timber
Products Ltd are constrained by volatile raw material prices with
low bargaining power, working capital intensive nature of
operation, continuous losses during the last three years and
exposure to the industry cycle. The rating however, draws strength
from long track record and experience of the promoters,
strong support from the group company and established brand of the
product.
Ability to derive benefits from the technological upgradation that
the company has made and effective management of the working
capital are the key rating sensitivities.
Mangalam Timber Products Ltd., incorporated in 1982, belongs to
the B K Birla group of companies, a diversified industrial group
having a major interest in tea, chemicals & fertilizers, cement,
tyres, textiles, vegetables oils, etc. MTPL is engaged in
manufacturing of Medium Density Fibre Boards (MDF), plain boards
and pre-laminated boards of varied thickness, from low-grade hard
woods with an installed capacity of 30,000 MT per annum.. The
product of the company finds its usage in door & window panels,
decorative furniture, veneer, plywood, board, etc. The
manufacturing facility of the company is located in Nabarangpur,
Odisha. The company sells its product under the brand name of
Duratuff.
During FY13, MTPL reported a loss of INR3.5 crore on a total
operating income of INR80.7 crore as against loss of INR3.5 crore
on a total operating income of INR76.3 crore in FY12. During the
six months ended September 30, 2013 (H1FY14) the company incurred
a loss of INR4.6 crore on a total operating income of INR 30.0
crore.
MATRIX BOILERS: CRISIL Puts 'B+' Rating on INR40MM Loan
-------------------------------------------------------
CRISIL has assigned its 'CRISIL B+/Stable/CRISIL A4' ratings to
the bank facilities of Matrix Boilers Pvt Ltd.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Packing Credit 20 CRISIL A4
Letter of Credit 20 CRISIL A4
Foreign Bill Discounting 10 CRISIL A4
Bank Guarantee 20 CRISIL A4
Cash Credit 40 CRISIL B+/Stable
The ratings reflect MBPL's modest scale and working capital
intensive nature of operations. The rating also factors the below-
average financial risk profile, marked by modest net worth, and
subdued debt protection metrics. These rating weaknesses are
partially offset by the extensive experience of MBPL's promoters
in the boiler fabrication business.
Outlook: Stable
CRISIL believes that MBPL will continue to benefit from the
extensive experience of its promoters in the boiler fabrication
business, over the medium term. The outlook may be revised to
'Positive' if the company reports a significant growth in its
revenues and profitability, while improving its financial risk
profile. Conversely, the outlook may be revised to 'Negative' in
case of a decline in MBPL's revenues and margins; or if there is
further lengthening of its working capital cycle, thereby
adversely affecting its financial risk profile.
MBPL, set up in 2006, is engaged in fabrication of boiler and
boiler components. The company has its fabrication facility
located at Pudukottai (Tamil Nadu). The promoters of the company
are Mr. N. Pandian, Mr. A Sekar, Mr. R. Neelamegam and Mr. K
Murugesan.
MBPL reported a profit after tax (PAT) of INR1.3 million on net
sales of INR90.9 million for 2012-13 (refers to the financial
year, April 1 to March 31), against PAT of INR1.5 million on net
sales of INR109.4 million for 2011-12.
MGR AGRO: CARE Reaffirms 'B+' Rating on INR10.88cr Loans
--------------------------------------------------------
CARE reaffirms the ratings assigned to the bank facilities of
MGR Agro Products Pvt Ltd.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank
Facilities 10.88 CARE B+ Reaffirmed
Rating Rationale
The rating assigned to the bank facilities of MGR Agro Products
Pvt Ltd continue to remain constrained by its short track record
coupled with small scale of operations with limited value
addition in a highly fragmented and competitive industry,
volatility in profit margins subject to government regulations and
raw material price fluctuations along with working capital
intensive nature of operations leading to leveraged capital
structure.
The rating, however, continue to derive strength from the
experience of the promoters, proximity of the plant to paddy
growing areas and satisfactory demand prospects of rice being a
major staple food grain.
The ability of the company to increase its scale of operations
along with an improvement in the profitability margins and
effective management of the working capital would be the key
rating sensitivities.
Jharkhand-based MGR Agro Products Pvt Ltd (MGR) was incorporated
in 2009 by Mr Anil Kumar Goyal and Mr Pawan Kumar Gupta. Since
inception, the company is engaged in the processing & milling of
rice. The product of the company is sold under the brand name of
'MGR' and it caters to the domestic clients. The company commenced
commercial production in January, 2011. The unit is located at
Singhbhum, Jharkhand and has a current processing capacity of 8
tonne per hour (TPH).
During FY13 (refers to the period April 1 to March 31), MGR
achieved a PBILDT of INR1.7 crore (INR1.6 crore in FY12) and a PAT
of INR0.2 crore (INR0.05 crore in FY12) on the total income of INR
19.3 crore (INR15.0 crore in FY12). Furthermore, during 9MFY14,
the company has achieved net sales of INR18.6 crore.
MICRO PRECISION: ICRA Reaffirms B+ Rating on INR7.5cr Loans
-----------------------------------------------------------
ICRA has re-affirmed long-term rating of [ICRA]B+ to the INR1.94
Crore long-term loans, INR0.56 Crore long-term proposed loans,
INR2.50 Crore long-term fund based facilities and the INR2.50
Crore long-term non fund based facilities of Micro Precision.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
LT-Loans 1.94 [ICRA]B+ re-affirmed
LT-Proposed Loans 0.56 [ICRA]B+ re-affirmed
LT-Fund based
Facilities 2.50 [ICRA]B+ re-affirmed
LT-Non fund based
Facilities 2.50 [ICRA]B+ re-affirmed
The reaffirmation of rating considers the significant experience
of the promoters in dealing with the Defence agencies and
supplying precision components, its established clientele base
(although plagued by issues of delayed collections) and continued
equity infusion by the promoters. The rating is however
constrained by the firm's limited scale of operations which
restricts its financial flexibility, high customer concentration
(with the top five customers, contributing to 90% of sales during
FY2011-12 and FY2012-13, stretched working capital intensity owing
to large inventory holding, stretched debtors position and the
weak performance during the current fiscal. Slow-down in orders
from the Firm's key customers in the defence coupled the stretched
collection cycle has impacted the company's performance during the
last fiscal as well as the current fiscal. Going forward, the
firm's ability to maintain and grow the top line, manage its
working capital position and grow its revenue profitably would be
critical to improving its credit.
Micro Precision is a partnership firm incorporated in 1989 by Mr.
D Magesh and his wife- Mrs. M Sandhya and is a Tier 1 supplier of
precision metal components primarily to the agencies/divisions
under the Ministry of Defence (Army and Navy). Precision
components supplied to the army are used in Army tanks like T72,
T90 and NBT Arjun. Components supplied to the Navy include valves,
pressure fittings, fasteners, Regeneration boxes and filters for
ships and submarines. Over 90% of the supplies are directly made
to the Defence sector and the rest is supplied to other Tier 1
suppliers.
Recent Results
According to unaudited results, the firm's net profits stood at
INR0.1 Crore on an operating income of INR2.6 Crore during the
nine months period ending December 2013. For the fiscal, 2012-13,
the firm reported an operating income of INR5.4 Crore with a net
profit of INR0.1 Crore.
NV DISTILLERIES: CARE Upgrades Rating on INR114.95cr Loan to BB-
----------------------------------------------------------------
CARE revises the rating assigned to the bank facilities of
NV Distilleries Ltd.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long term Bank 114.95 CARE BB- Revised from
Facilities CARE C
Rating Rationale
The rating revision factors in the consistent growth in revenue
and improvement in financial position through H1FY14 (refers to
the period April 1 to September 30). The rating also derives
strength from the experienced promoters, being part of a well-
established group, strategic location and high entry barrier in
the industry.
However, the rating is constrained by the exposure to changes in
the state policies regarding pricing and sales, working capital
intensive nature of operations and volatility in the raw material
prices.
Going forward, the ability of NVDL to improve its profitability
along with managing the volatility in the raw material prices and
effective management of working capital requirements will be the
key rating sensitivities.
NV Distilleries Ltd is a part of the NV group which consists of
group companies, namely, NV Distilleries & Breweries Ltd (rated
CARE C/A4), Gemini Distilleries (Goa) Pvt Ltd, NV Resorts Pvt Ltd
(rated CARE C/A4), NV International Ltd (rated CARE BB-) and NV
Distilleries and Breweries (North East) Pvt Ltd (rated CARE BB-
/A4).
The company is promoted by Mr Ashok Jain and Mr Sameer Goyal, who
have substantial relevant experience of around two decades in the
industry.
NV Distilleries Limited, started in the year 1999, has set up a
grain-based distillery in Ambala (Haryana) with 75 KL per day
capacity plant which had commenced commercial production in
November 2008 having a captive power generation plant (2.5MW).
The company realizes revenue primarily from the sale of extra
neutral alcohol (ENA), Indian Made Foreign Liquor (IMFL)
facilities (capacity-48 lakh cases per annum) and country liquor
(capacity-48 lakh cases per annum). The company carries out
bottling operations for M/s Pernod Ricard India Private Ltd for
the production of their brands.
During FY13 (refers to the period April 1 to March 31), NVDL
achieved a total income of INR241.51 crore with a PAT of INR7.33
crore against a total income of INR208.18 crore with a PAT of
INR10.49 crore in FY12. During H1FY14, NVDL registered a total
income of INR115.96 crore with a PBT of INR8.04 crore.
PAR DRUGS: ICRA Revises Rating on INR33.68cr Loans to 'D'
---------------------------------------------------------
ICRA has revised the long term rating assigned to the INR32.68
crore (enhanced from INR27.60 crore) long term fund based
facilities of Par Drugs & Chemicals Private Limited to [ICRA]D
from [ICRA]B+. ICRA has also revised the short term rating
assigned to the INR1.00 crore (enhanced from INR0.10 crore) short-
term non-fund based facilities of PDPL to [ICRA]D from [ICRA]A4.
The short term facilities are sublimit of the cash credit
facility.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Cash Credit 5.00 Revised to [ICRA]D from
[ICRA]B+
Term Loans 27.68 Revised to [ICRA]D from
[ICRA]B+
Short term
facilities (1.00) Revised to [ICRA]D from
[ICRA]A4
Rationale
The rating revision factors the delays in debt servicing as a
result of liquidity constraints, also arising from the delays in
commencement of operations from the largely debt funded expansion
facility. The ratings continue to remain constrained by small
scale of the company's operations in a commoditized basic chemical
industry and vulnerability of profitability to adverse
fluctuations in prices of key raw materials which may not be
passed onto the customers adequately. The ratings also take into
account the company's exposure to foreign currency exchange rate
fluctuations on export sales, although the risk is mitigated to
the extent of forward contracts booked by the company. ICRA also
takes note of the fact that the company's annual repayment
obligations for next five years are quite sizeable and achievement
of optimum utilization of newly added capacities remains critical
from the credit perspective.
The ratings, however, take into consideration the long experience
of promoters and established track record of the company in basic
chemical manufacturing industry, diversified clientele base, and
moderate profitability maintained by the company at operating
level over the last five years.
PDPL is promoted by Mr. V J Savani and his two sons Mr. Falgun and
Mr. Jignesh Savani. Based out of Bhavnagar (Gujarat), the company
is engaged in manufacturing basic chemicals including Aluminium
and Magnesium salts majorly used in antacid drugs and polymer
industry. The company finds its roots in M/s Par Inorganic,
proprietary firm, set up in 1982 by first generation entrepreneur
Mr. V. J. Savani in Bhavnagar. The firm was converted into a
private limited company in 1999. The company has two manufacturing
facilities, one at Bhavnagar and other at Ankaleshwar with
Bhavnagar facility being WHO GMP approved.
Recent Results
For the year ended March 31, 2013 the company reported an
operating income of INR18.68 crore and profit after tax of INR0.90
crore as against an operating income of INR18.57 crore and profit
after tax of INR1.12 crore for the financial year 2011-12.
PATIDAR COTSPIN: CARE Revises Rating on INR15.54cr Loan to 'D'
--------------------------------------------------------------
CARE revises the rating assigned to the bank facilities of
Patidar Cotspin Private Limited.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank 9.04 CARE D Revised from
Facilities CARE B
Short-term Bank 6.50 CARE D Revised from
Facilities CARE A4
Rating Rationale
The revision in the ratings assigned to the bank facilities of
Patidar Cotspin Private Limited was on account of the frequent
instances of delay in debt servicing due to the stressed liquidity
position.
Establishing a clear debt servicing track record with an
improvement in the liquidity position is the key rating
sensitivity.
Incorporated in 2006, PCPL is promoted by Mr Suresh Amin, Mr
Jayesh Patel and Mr Jitendra Borsaliya having vast experience in
the cotton ginning industry. PCPL was setup as a part of
forward integration to manufacture cotton yarn of coarser count
ranging from Ne6 to Ne27 through rotor spinning technology. The
company has an installed capacity of 960 rotors equivalent to
3,600 Metric Tonnes Per Annum (MTPA) and ring yarn as well as
knitting yarn capacity of 4,000 spindles equivalent to 1,500 MTPA
at its facility at Vijapur, Mehsana (Gujarat). The commercial
production of ring yarn and knitting yarn segment commenced in
FY12 (refers to the period April 1 to March 31). PCPL uses cotton
bales for the manufacturing of cotton yarn and caters to the
demand of manufacturers of denim products and industrial fabrics
in India and abroad.
The promoters also run other entities which are engaged in the
cotton ginning business, namely, Patidar Industries Private
Limited and Somnath Ginning Pressing Private Limited.
As per the audited results for FY13, PCPL reported a net loss of
INR2.36 crore (net loss of INR2.13 crore in FY12) on a total
operating income of INR31.80 crore (INR25.91 crore in FY12). As
per the provisional results for 9MFY14, PCPL reported a total
operating income of INR25.77 crore.
PETRO CHEM: ICRA Withdraws B+ Rating on INR5cr Loans
----------------------------------------------------
ICRA has withdrawn the [ICRA]B+ (pronounced ICRA B plus) rating
assigned earlier to the INR5.00 Cr. proposed cash credit facility
of Petro Chem Industries at the request of the firm as the
proposed limits were not sanctioned. Hence there is no amount
outstanding against the rated instrument.
PSN MOTORS: CRISIL Assigns 'B' Rating to INR90MM Loans
------------------------------------------------------
CRISIL has assigned its 'CRISIL B/Stable' rating to the long-term
bank facilities of PSN Motors Pvt Ltd.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Term Loan 2.9 CRISIL B/Stable
Proposed Long Term
Bank Loan Facility 31.6 CRISIL B/Stable
Cash Credit 48 CRISIL B/Stable
Overdraft Facility 7.5 CRISIL B/Stable
The rating reflects PSN's modest scale of operations in the
intensely competitive automobile dealership industry, and its
below-average financial risk profile, marked by high gearing. The
rating also factors in the company's exposure to significant
principal concentration risk. These rating weaknesses are
partially offset by the extensive industry experience of PSN's
promoters and its established market position in Kerala.
Outlook: Stable
CRISIL believes that PSN will continue to benefit over the medium
term from its established market position in Kerala. The outlook
may be revised to 'Positive' if PSN's sales volumes and operating
margin improve substantially, leading to higher-than-expected
accruals and thus to an improvement in its financial risk profile.
Conversely, the outlook may be revised to 'Negative' if the
company's market share declines, significantly impacting its
revenues and profitability, or if it undertakes a large debt-
funded capital expenditure programme, leading to further
deterioration in its capital structure and cash accruals.
About the Company
PSN was initially set up in 1921; and later incorporated as a
private limited company in 1952. Since 2009, PSN has been an
authorised dealer for SML Isuzu Ltd. It is presently managed by
its managing director, Mr. P K Sangameswaran.
PSN reported a profit after tax (PAT) of INR2.1 million on net
sales of INR331.2 million for 2012-13 (refers to financial year,
April 1 to March 31) as against a PAT of INR2.4 million on net
sales of INR266.4 million for 2011-12.
R K SHAH: ICRA Assigns 'C' Rating to INR10cr Loans
--------------------------------------------------
ICRA has assigned a long term rating of '[ICRA]C' to the INR10.00
crore fund based limits and a short term rating of [ICRA]A4 to the
INR5.00 crore nonfund based sublimit of R K Shah Projects Pvt.
Ltd.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Fund Based Cash
Credit Limits 10.00 [ICRA]C assigned
Non-Fund Based
Bank Guarantee
Limits 5.00 [ICRA]A4 assigned
The assigned ratings take into account the stretched liquidity
position of the company resulting in delays in servicing its
interest obligations in the past, weak financial profile of the
company characterized by small operating scale, highly leveraged
capital structure owing to high reliance on working capital
borrowings and the consequent high interest burden, which has led
to subdued net profitability levels. The ratings are also
constrained by the time overruns in the government projects
undertaken resulting in unbilled revenues and blocking of
retention money as well as high inventory holding. The ratings are
also constrained by regional concentration, since a majority of
the projects executed are based in Gujarat, and the competitive
intensity the company is exposed to at the time of bidding as a
primary contractor, on account of the presence of a large number
of qualified civil contractors.
The ratings, nevertheless, favourably factor in the long
experience of the company's promoters in the construction business
and the relatively lower counter party credit risk given its
exposure largely to state government bodies. Going forward, the
ability of the company to raise funds in a timely manner
to meet the increasing working capital requirements of its large
unexecuted order book would be critical.
Established in 1998, R K Shah Projects Pvt. Ltd. is engaged in the
execution of construction contracts pertaining to state owned
entities. The company primarily undertakes construction projects
in Gujarat in the nature of common effluent treatment plants,
sewage pumping stations, buildings and concrete bridges majorly as
a sub-contractor. R K Shah is registered as class "AA" contractors
with Gujarat Industrial Development Corporation (GIDC), as
registered project management consultants and a third party
Inspection Company. R K Shah has its administrative office in
Surat, Gujarat.
RAJMAL LAKHICHAND: ICRA Cuts Rating on INR240.74cr Loans to D
-------------------------------------------------------------
ICRA has downgraded the rating of [ICRA]B to [ICRA]D to the
INR215.74 Crore (earlier INR163.20 Crore) long term fund based
facility of Rajmal Lakhichand Jewellers Pvt. Ltd. ICRA has also
assigned rating of [ICRA]D to the INR31.50 Crore short term fund
based facility of RLJPL. ICRA has also downgraded the rating of
[ICRA]A4 to [ICRA]D to the INR25.00 crore short term non fund
based facility of RLJPL.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Fund
Based Limits 184.24 [ICRA]D; downgraded
Short Term Fund
Based Limits 31.50 [ICRA]D; downgraded
Short Term Non
Fund Based Limits 25.00 [ICRA]D; downgraded
In arriving at the ratings, ICRA has taken a consolidated view of
RLJPL along with R. L. Gold Private Limited (RLGPL), Rajmal
Lakhichand & Sons (RL & Sons) and Manraj Jewellers Private Limited
(MJPL). The ratings reflect RLJPL's stressed liquidity position
resulting in recent delays in debt repayment obligations and high
utilization of working capital limits alongwith its stretched
financial profile. The business risk profile is also adverse, with
exposure to gold price volatility and increasing competitive
intensity from organized as well as unorganized sectors.
Rajmal Lakhichand (RL) Group is a Jalgaon-based business house,
which is engaged in the manufacture and trading of gold jewellery
since 1854. The group operates its showrooms through Rajmal
Lakhichand, which is the principal concern with showrooms in
Jalgaon and RLJPL, which owns showrooms outside Jalgaon. The group
consists of three other companies, R. L. Gold Private Limited,
Manraj Jewellers Private Limited and Rajmal Lakhichand & Sons,
which are involved in gold jewellery manufacturing and two more
companies, which are engaged in other businesses.
Incorporated in December 2004, RLJPL owns retail showrooms
belonging to the group. Currently, it has its showrooms at Nasik
and Thane. It deals in gold, silver and diamond jewellery, with
most of the sales coming from gold jewellery
REALTRACK WIRE: CARE Revises Rating on INR13.73cr Loan to 'D'
-------------------------------------------------------------
CARE revises the rating assigned to the bank facilities of
Realtrack Wire Industries Private Limited.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank 13.73 CARE D Revised from
Facilities CARE B
Rating Rationale
The revision in the rating assigned to the bank facilities of
Realtrack Wire Industries Private Limited (RWIPL) is primarily
driven by the delay in debt repayment due to weak liquidity
position on account of time and cost over-run in the project
execution. Establishing a clear debt servicing track record with
an improvement in the liquidity position and increasing the scale
of operations through optimum utilization of newly started
manufacturing facilities would remain the key rating sensitivity.
Ahmedabad-based (Gujarat), RWIPL was incorporated by Mr Tushar
Shah and Mr Vipul Shah in 2011, with an objective to carry out
business of manufacturing galvanized and non-galvanized ferrous
wires. RWIPL undertook implementation of its green-field project
for setting up a wire drawing unit with an installed capacity of
11,400 Metric Tons Per Annum (MTPA). The project was completed
with a delay of around 7 months and the commercial production was
commenced from August 2013. The products manufactured by RWIPL are
used as a raw material for various industries mainly automobile,
textile, engineering and spring making units. At present, RWIPL
carries out job-work activities for TATA Wiron as well as own
manufacturing and 60% of the installed capacity is used for job
work for TATA Wiron while the rest is used for own manufacturing.
The promoters also have experience of trading of wire and rods
through their group entity Roundwell Steel Corporation (RSC, rated
CARE B+). The other group concerns include Realtrack Steel (RS),
Roundwell Spring Industries (RSI), and Hina industries. RS is in
the trading of spring wires, MS wires and bright bars. RSI and HI
are in the business of manufacturing springs at Ahmedabad.
The commercial operations commenced from August 2013. During the
first six months of operations (refers to the period August 2013
to January 2014), RWIPL reported a total operating
income (TOI) of INR4.57 crore.
RELCOM TECHNOLOGY: ICRA Rates INR11.75cr Loans at 'B'
-----------------------------------------------------
ICRA has assigned a long term rating of '[ICRA]B' for INR11.75
crore bank lines of Relcom Technology Private Limited. ICRA has
also assigned a short term rating of [ICRA]A4) for INR1.0 crore
bank lines of RTPL.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Unallocated 11.75 [ICRA]B (Assigned)
Unallocated 1.0 [ICRA]A4 (Assigned)
The assigned rating takes into consideration RTPL's modest scale
of operations on account of limited track record of operations in
its core business of manufacturing of rexine; and high working
capital intensity of the business on the back of high inventory
and receivable levels. The ratings also factor in the highly
competitive and fragmented nature of the industry which limits the
pricing flexibility of the industry participants including RTPL;
vulnerability of the company's profitability to raw material price
volatility; and it's relatively high gearing level and moderate
debt protection metrics. The rating however draws comfort from the
steady ramp up of manufacturing volumes achieved by the company,
given that its manufacturing facility is in close proximity to
numerous footwear manufacturers, which provides ample sales
opportunity for the company; and RTPL's wide customer base which
also includes some established players of the footwear industry.
Additionally the ratings also take into account the steady demand
prospects for rexine usage from various manufacturing segments
like footwear, furniture, automobiles, etc. Going forward,
increase in the company's scale of operations, whilst maintaining
its profitability indicators and improvement in the capital
structure will remain key rating sensitivities.
Relcom Technology Private Limited was incorporated in the year
2008 by members of the Birhman family. RTPL is engaged in the
business of rexine manufacturing. The affairs of the company are
being managed by Dr. Ran Singh Birhman and his son Mr. Amit
Birhman. The company's manufacturing facility is located in
Bahadurgarh (Haryana) wherein it commenced commercial operations
in the month of October 2012. The facility has an installed annual
capacity to manufacture upto 36 lakh sq.mts. of rexine.
Recent Results
For FY2013, the company reported a profit after tax of INR0.04
crore on an operating income of INR10.89 crore.
ROUNDWELL STEEL: CARE Revises Rating on INR6.80cr Loans to 'B+'
---------------------------------------------------------------
CARE revises the rating assigned to the bank facilities of
Roundwell Steel Corporation.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank 6.80 CARE B+ Revised from
Facilities CARE BB-
The rating assigned by CARE is based on the capital deployed by
the partners and the financial strength of the firm at present.
The rating may undergo change in case of withdrawal of the capital
or the unsecured loans brought in by the partners in addition to
the financial performance and other relevant factors.
Rating Rationale
The revision in the rating assigned to the bank facilities of
Roundwell Steel Corporation (RSC) is primarily driven by
deterioration in its financial risk profile marked by net loss
during FY13 (refers to the period April 1 to March 31) leading to
deterioration in debt coverage indicators and liquidity position.
The rating continues to remain constrained on account of the high
inventory holding risk, moderately leveraged capital structure,
weak debt coverage indicators, working capital intensive
nature of its operations and inherent cyclicality in the steel
industry.
The ratings, however, continue to derive comfort from the
experience of the promoters and established track record of
operations as well as distributorship tie-ups with established
players. The ability of RSC to improve the profit margins by
managing the volatility associated with the raw material price,
improvement in the capital structure and liquidity position as
well as better working capital management would remain the key
rating sensitivities.
RSC is a partnership firm established in the year 2000. RSC has
been in the trading business for the last 13 years and is managed
by four partners. RSC is engaged in the wholesale and retail
trading of various types of wires, ferrous and non-ferrous metals,
hardware, etc. RSC is the authorized distributor of Tata Wiron in
Gujarat. RSC also has the dealership of M/s Usha Martin Limited.
The retail activities of RSC are routed through their outlet at
Rakhial, Ahmedabad and RSC has its warehouse at Aslali, Ahmedabad.
The products of RSC are being used mostly in automobile, textiles
and spring manufacturing industries.
The promoters also ventured into wire manufacturing business
through their group concern 'Realtrack Wire Industries Private
Limited' (RWIPL, rated CARE D) which was incorporated in
August 2011 with the objective to carry out the business of
manufacturing of galvanized and nongalvanized wires. The other
group concerns include Realtrack Steel (RS), Roundwell Spring
Industries (RSI) and Hina Industries. RS is into the trading of
spring wires, MS wires and bright bars. RSI and HI are in the
business of manufacturing springs at Ahmedabad.
As per the audited results for FY13, RSC reported a net loss of
INR0.49 crore (PAT of INR0.03 crore in FY12) on a TOI of INR53.50
crore (Rs.47.02 crore in FY12). During 9MFY14, RSC reported a TOI
of INR25.46 crore.
SADHU RAM: CRISIL Reaffirms 'B+' Rating on INR19MM Loan
-------------------------------------------------------
CRISIL's ratings on the bank facilities of Sadhu Ram Jai Parkash
(SRJP; part of the Jugal Kishor group) continue to reflect the
Jugal Kishor group's average financial risk profile, constrained
by low cash accruals; and moderate business risk profile,
constrained by its working-capital-intensive operations. These
rating weaknesses are partially offset by the extensive experience
of the Jugal Kishor group's promoters in the timber trading
industry and their funding support.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 19 CRISIL B+/Stable (Reaffirmed)
Letter of Credit 100 CRISIL A4(Reaffirmed)
For arriving at the ratings, CRISIL has combined the business and
financial risk profiles of SRJP and Jugal Kishore Kashmiri Lal
(JKKL), together referred to as the Jugal Kishor group. This is
because both the entities are in the same line of business and are
managed by common promoters. Also, CRISIL has treated unsecured
loans of INR67.7 million, extended by the group's promoters, as
neither debt nor equity as the same are expected to remain in the
business over a long term.
Outlook: Stable
CRISIL believes that the Jugal Kishor group will continue to
benefit from its promoters' extensive industry experience, over
the medium term. The outlook may be revised to 'Positive' in case
of a significant improvement in the group's financial risk
profile, including its liquidity, most likely because of
improvement in cash accruals and working capital cycle.
Conversely, the outlook may be revised to 'Negative' in case the
group's lower-than-expected cash accruals or larger-than-expected
working capital requirements cause its liquidity to deteriorate.
Update
The Jugal Kishor group reported a marginal growth in its revenue,
as reflected in net sales of INR639.5 million for 2012-13 (refers
financial year, April 1 to March 31) against INR568.9 million for
2011-12. The group's operating margin was stable at around 2.1 per
cent. Also, the group continued to have stretched working capital
management, with gross current assets of around 180 days for 2012-
13. In the absence of sufficient cash accruals and a small net
worth, the group continued its dependence on bank debt and funding
support from promoters in the form of unsecured loans. The total
quantum of unsecured loans stood at INR67.7 million as on March
31, 2013, as compared to INR62.5 million as on March 31, 2012.
The Jugal Kishor group's net worth was also small at INR13.3
million as on March 31, 2013, thereby limiting its financial
flexibility to meet any exigency. The group has high debt levels
towards funding its working capital requirements; these, along
with small net worth, is estimated to result in a high total
outside liabilities to tangible net worth ratio of around 18 times
as on March 31, 2013.
The Jugal Kishor group started operations in 1992 in Jind
(Haryana), with processing facilities located in Gandhidham
(Gujarat). Presently, the group operates two entities, SRJP and
JKKL, and is engaged in processing and trading in timber, mainly
hard wood. The group is managed by Mr. Rakesh Goel, Mr. Raja
Kumar, Mr. Ved Prakash, and Mr. Akshay Kumar.
SAI LEKSHMI: CRISIL Puts 'B' Rating to INR60MM Loans
----------------------------------------------------
CRISIL has assigned its 'CRISIL B/Stable/CRISIL A4' ratings to the
bank facilities of Sai Lekshmi Cashew Company.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Proposed Long Term
Bank Loan Facility 30 CRISIL B/Stable
Letter of Credit 25 CRISIL A4
Export Packing Credit 30 CRISIL B/Stable
Foreign Bill Purchase 15 CRISIL A4 --
The ratings reflect SLCC's large working capital requirements and
below-average financial risk profile marked by high total outside
liabilities to tangible net worth ratio. These rating weaknesses
are partially offset by the extensive experience of SLCC's
promoter in the cashew industry.
Outlook: Stable
CRISIL believes that SLCC will benefit over the medium term from
its promoter's extensive experience in the cashew industry. The
outlook may be revised to 'Positive' if the firm records
considerable increase in revenue and profitability, leading to
better-than-expected cash accruals and improvement in its
financial risk profile. Conversely, the outlook may be revised to
'Negative' if SLCC reports lower-than-expected revenue or
profitability, or if the firm's working capital management weakens
resulting in weak liquidity, or if the firm undertakes a large
debt-funded capital expenditure programme leading to weakening of
its financial risk profile.
Set up in 1998, SLCC processes raw cashew nuts. The firm's day-to-
day operations are managed by the proprietor, Ms. R Jalajakumari.
The firm reported profit after tax (PAT) of INR1.2 million on net
sales of INR130.5 million for 2012-13 (refers to financial year,
April 1 to March 31), against PAT of INR0.92 million on net sales
of INR105.4 million for 2011-12.
SAMRAKSHANA ELECTRICALS: CRISIL Ups INR358.7MM Loan Rating to B-
----------------------------------------------------------------
CRISIL has upgraded its ratings on the bank facilities of
Samrakshana Electricals Ltd to 'CRISIL B-/Stable/CRISIL A4' from
'CRISIL D/CRISIL D'.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Bank Guarantee 30 CRISIL A4 (Upgraded from
'CRISIL D')
Cash Credit 150 CRISIL B-/Stable (Upgraded
from 'CRISIL D')
Letter of Credit 40 CRISIL A4 (Upgraded from
'CRISIL D')
Proposed Long Term
Bank Loan Facility 208.7 CRISIL B-/Stable (Upgraded
from 'CRISIL D')
The rating upgrade reflects improvement in liquidity backed by
improved working capital management, leading to no continuous
overdrawn in cash credit limit over the past four months through
January 2014. CRISIL expects SEL to sustain its working capital,
backed by faster realizations from its customers. Its debtors have
improved to 149 days as on March 31, 2013 from 216 days as on
March 31, 2012. The rating upgrade also factors in CRISIL's belief
that SEL's liquidity will be supported by absence of capital
expenditure (capex) plan or long-term debt obligations over the
medium term.
The ratings reflect SEL's below-average financial risk profile,
marked by moderate gearing and weak debt protection metrics, its
working-capital-intensive operations, and limited pricing
flexibility and susceptibility of SEL's margins to volatility in
raw material prices. These rating weaknesses are partially offset
by its promoters' extensive industry experience.
Outlook: Stable
CRISIL believes that SEL's overall credit risk profile will remain
constrained over the medium term because of its subdued debt
protection metrics. The outlook may be revised to 'Positive' if
SEL reports higher-than-expected cash accruals, driven by
substantial increase in its scale of operations and profitability,
leading to improvement in its financial risk profile. Conversely,
the outlook may be revised to 'Negative' in case of decline in
SEL's profitability, or elongation in its working capital cycle,
leading to pressure on its liquidity.
SEL, a group company of Vijai Electricals Ltd (VEL; rated CRISIL
B-/CRISIL A4, on rating watch with Positive implications), was set
up in 1987 by Mr. D J Ramesh and commenced operations in 1990-91
(refers to financial year, April 1 to March 31). SEL manufactures
oil-immersed circuit breakers, porcelain insulators, press boards,
and powder paint used in transformers.
For 2012-13, SEL reported a net loss of INR81.8 million on net
sales of INR475.5 million, vis-a-vis a net loss of INR51.8 million
on net sales of INR413.8 million for 2011-12.
SHREE DATTA: CRISIL Reaffirms 'B+' Rating on INR80MM Loan
---------------------------------------------------------
CRISIL's ratings on the bank facilities of Shree Datta Fertilizers
and Chemical Pvt Ltd continue to reflect SDFCPL's modest scale of
operations, large working capital requirements, and the
susceptibility of its operating performance to the level of
agricultural activity in and around Vidarbha (Maharashtra).
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 80 CRISIL B+/Stable (Reaffirmed)
The ratings also factor in SDFCPL's exposure to risks related to
regulatory changes with regard to raw material procurement, and
its weak debt protection metrics. These rating weaknesses are
partially offset by the extensive experience of the company's
promoter in the fertiliser and chemical business and the benefits
expected from the healthy demand for granular fertilisers.
Outlook: Stable
CRISIL believes that SDFCPL will continue to benefit over the
medium term from its promoter's extensive experience in the
fertiliser industry and the healthy demand for granular
fertilisers. The outlook may be revised to 'Positive' if the
company significantly improves its revenues and net cash accruals,
while maintaining its capital structure and debt protection
metrics. Conversely, the outlook may be revised to 'Negative' if
SDFCPL's scale of operations declines, or its working capital
cycle lengthens, or it contracts more-than-expected debt.
Update
SDFCPL's revenues improved to INR129 million in 2012-13 (refers to
financial year, April 1 to March 31) from INR62 million in 2011-
12. With ease in availability of di-ammonium phosphate, SDFCPL was
able to improve its production in 2012-13. Moreover, the adequate
rainfall in 2013-14 has led to healthy demand for fertilisers and
resulted in stable revenues of around INR92 million for the six
months ended September 30, 2013. However, the company's operating
margin declined sharply to 14.1 per cent in 2012-13 from 27.1 per
cent in 2011-12 because of its inability to pass on the increase
in raw material cost to its end-users. The operating margin is
expected to be stable over the near term on account of stable raw
material prices in 2013-14.
SDFCPL's financial profile continues to be moderate, marked by a
moderate net worth of INR111 million and low gearing of 0.9 times,
as on March 31, 2013. However, due to higher finance costs and
large working capital requirements resulting in moderate debt
levels, the company's interest coverage and net cash accruals to
total debt ratios have declined to 1.6 times and 6 per cent,
respectively, in 2012-13, from 1.8 times and 9 per cent,
respectively, in 2011-12.
As on March 31, 2013, SDFCPL had an inventory of 376 days. The
large inventory requirements are on account of shortage of raw
material as well as the seasonal nature of fertiliser sales. Due
to modest net cash accruals vis-a-vis large working capital
requirements, the company's bank limits have been highly utilised
during the peak season from November to June at around 90 per
cent; the overall utilisation was 77 per cent during the 12 months
through October 2013. However, SDFCPL's liquidity is adequate,
marked by the absence of debt repayment obligations and no capital
expenditure plans. Furthermore, as on March 31, 2013, the company
had a high unencumbered cash and bank balance of about INR28
million, while its current ratio was moderate at 1.5 times.
SDFCPL was set up by Mr. Ashok Ratanlal Soni in 1999. It
manufactures nitrogen, phosphorous, and potassium (NPK) granulated
mixed fertilisers. The company sells these fertilisers primarily
through a network of dealers in and around Vidarbha.
SHREE VINAYAK: ICRA Suspends 'B- Rating on INR7.10cr Loans
----------------------------------------------------------
ICRA has suspended the '[ICRA]B-' rating assigned to the INR7.10
crore long term fund based facilities of Shree Vinayak Foods &
Fabrics Private Limited. The suspension follows ICRA's inability
to carry out a rating surveillance in the absence of the requisite
information from the company.
According to its suspension policy, ICRA may suspend any rating
outstanding if in its opinion there is insufficient information to
assess such rating during the surveillance exercise.
Incorporated in the year 1988, Shree Vinayak Foods & Fabrics
Private Limited (SVFFPL) is engaged in manufacturing of knitted
hosiery fabrics and ready to eat frozen food products. The textile
division of the company is managed by Mr. Rajivratna Joshi, who is
a Textile Engineer by qualification and also the director of the
company while the food division is managed by his son Mr. Shreeraj
Joshi, who is Food Technologist by qualification.
SREE GURU: CRISIL Assigns 'B-' Rating to INR50MM Loan
-----------------------------------------------------
CRISIL has assigned its 'CRISIL B-/Stable' rating to the long-term
bank facilities of Sree Guru Raghavendra Cotton Ginning Factory
(SGRCGF). The rating reflects SGRCGF's exposure to risks
associated with the setting up of a ginning unit in Bellary
(Karnataka). This rating weakness is partially offset by the
extensive experience of the firm's promoters in the cotton ginning
industry.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Proposed Cash 50 CRISIL B-/Stable
Credit Limit
Outlook: Stable
CRISIL believes that SGRCGF will continue to benefit over the
medium term from the extensive industry experience of its
promoters. The outlook may be revised to 'Positive' if the firm
stabilises its operations earlier than expected, resulting in
higher-than-anticipated cash accruals. Conversely, the outlook may
be revised to 'Negative' if there are delays in stabilisation of
SGRCGF's operations, resulting in lower-than-anticipated cash
accruals, or if it undertakes a substantial debt-funded capital
expenditure programme.
SGRCGF was established in 2013 as a partnership firm, promoted by
Mr. Moulali and his family. The firm is setting up a cotton
ginning unit in Bellary (Karnataka).
SRI NACHAMMAI: CRISIL Ups Rating on INR391MM Loans to 'B+'
----------------------------------------------------------
CRISIL has upgraded its rating on the bank facilities of
Sri Nachammai Cotton Mills Ltd (SNCML) to 'CRISIL B+/Stable' from
'CRISIL B-/Stable', and has reaffirmed its rating on the
company's short-term facilities at 'CRISIL A4'.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 200 CRISIL B+/Stable (Upgraded
from 'CRISIL B-/Stable')
Letter of Credit 53 CRISIL A4 (Reaffirmed)
Long Term Loan 191 CRISIL B+/Stable (Upgraded
from 'CRISIL B-/Stable')
The rating upgrade reflects CRISIL's belief that SNCML's liquidity
will improve over the medium term backed by healthy cash accruals
The company is expected to post cash accruals of INR65 million to
INR95 million per annum over the medium term against term loan
repayment obligations of INR43 million per annum over the medium
term. The increase in cash accruals is attributable to increased
volumes.
The ratings reflect SNCML's below-average financial risk profile,
marked by a high gearing, a small net worth, and weak debt
protection metrics and vulnerability to volatility in raw material
prices. These rating weaknesses are partially offset by the
extensive experience of SNCML's promoter in the textiles industry.
Outlook: Stable
CRISIL believes that SNCML will continue to benefit over the
medium term from its promoters' extensive industry experience. The
outlook may be revised to 'Positive' if the company reports
healthy improvement in revenues and profitability leading to
significant and sustained improvement in cash accruals and capital
structure.. Conversely, the outlook may be revised to 'Negative'
in case SNCML's financial risk profile weakens further, as a
result of larger-than-expected working capital requirements or
debt-funded capital expenditure, or in the event of delay in
funding support from its promoters.
SNCML, incorporated in 1980 in Tamil Nadu, is promoted by Mr. P
Palaniappan. The company manufactures cotton yarn in three
varieties, hosiery yarn, warp yarn, and hank yarn, with counts
ranging from 10s to 80s, which are used for manufacturing
garments.
SNCML reported a net profit of INR35 million on net sales of
INR1.51 billion for 2012-13, against a net loss of INR77 million
on net sales of INR1.04 billion for 2011-12.
SRI VARADHARAJA: CARE Revises Rating on INR6.73cr Loan to 'BB-'
---------------------------------------------------------------
CARE revises the rating assigned to the bank facilities of
Sri Varadharaja Fruit Products Private Limited.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank 6.73 CARE BB- Revised from
Facilities CARE B+
Rating Rationale
The revision in the rating of the bank facilities of Sri
Varadharaja Fruit Products Private Limited (SVFP) factors in the
improvement in the financial risk profile characterized by growth
in total operating income, improvement in coverage indicators
along with moderate profitability margins. The rating continues
to draw comfort from the experienced and resourceful promoters,
wide distribution network coupled with reputed client base and
positive outlook of the beverage industry. However, the rating
continues to remain constrained by the intense competition, raw
material prices dependent on agro-climatic conditions and seasonal
nature of its business.
Going forward, the ability of the company to increase its scale of
operations while improving its profitability margins and efficient
working capital management shall be the key rating sensitivities.
SVFP was incorporated in the year 2000; however in 2010, the
company was taken over by the Asianlak group which was promoted by
Mr Radhe Shyam Poddar with his two sons; Mr Gopal Poddar and Mr
Neeraj Poddar. The commercial production of the company started in
FY10 (refers to the period April 01 to March 31) and the company
is engaged in the processing of fruit juices and manufacturing of
soft drinks.
The company sells its fruit juices under the brand name 'Mr.
Fresh' in flavors, viz, mango, apple, litchi, guava and mixed
fruit and soft drink under the brand name of 'Top Cola'.
As per the audited results for FY13, SVFP reported a total
operating income of INR21.98 crore and a PAT of INR0.42 crore.
During 9MFY14, SVFP achieved a total operating income of INR21
crore.
SRI VENKATESWARA: ICRA Assigns 'B' Rating to INR32.70cr Loans
-------------------------------------------------------------
ICRA has assigned a long-term rating of '[ICRA]B' to INR32.50
crore fund based limits and to INR0.20 crore non-fund based limits
of Sri Venkateswara Fertilizers Private Limited. ICRA has also
assigned ratings of '[ICRA]B/[ICRA]A4' to INR0.30 crore
unallocated limits of SVFPL.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Fund based limits 32.50 [ICRA]B assigned
Non-fund based limit 0.20 [ICRA]B assigned
Unallocated 0.30 [ICRA]B/[ICRA]A4 assigned
The assigned ratings are constrained by the project execution risk
in the construction of NKP (Nitrogen-Phosphorous-Potassium)
granulation and Single Super Phosphate (SSP) plants due to pending
approvals and limited experience of the promoters in the
fertilizer industry. The ratings are further constrained by
susceptibility of operating margins to the agro-climatic risks and
regulatory risks involved in the fertiliser business. The ratings
however favourably factors in the healthy growth prospects of
fertilizer industry in India due to policy impetus to stimulate
demand and favourable pricing mechanism based on Nutrient Based
Subsidy (NBS) which leads to lower vulnerability of profitability
for P&K (Potassium & Phosphorous) fertilizers.
Timely completion of the project without cost overruns and
generating sufficient cash accruals towards the repayment of term
loan are key rating sensitivities from credit perspective.
Sri Venkateswara Fertilizers Private Limited was incorporated as a
private limited company in August 2011 to set up NPK granulated,
Single Super Phosphate (SSP) and Di calcium phosphate (DCP) plants
in East Godavari District of Andhra Pradesh. The total cost of the
project is 47.09 crore funded by term loan of INR25.50 crore and
the remaining is promoter's contribution. The DCP plant is in
operational since June, 2013 whereas the construction of NPK and
SSP plant is delayed on account of pending approvals. The total
cost incurred till September is INR27.89 crore, funded by term
loan of INR15.45 crore and the remaining through promoter's funds.
SSM FOUNDATION: CRISIL Cuts Rating on INR75.1MM Loan to 'C'
-----------------------------------------------------------
CRISIL has downgraded its rating on the long-term bank facilities
of SSM Foundation Trust for Educational and Social Development to
'CRISIL C' from 'CRISIL BB+/Stable'.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Proposed Long-Term 36.6 CRISIL C (Downgraded from
Bank Loan Facility 'CRISIL BB+/Stable')
Term Loan 38.5 CRISIL C (Downgraded from
'CRISIL BB+/Stable')
The rating downgrade reflects the sharp deterioration in SSM's
liquidity owing to lower than expected cash accruals and delays in
receipt of fees from students. The downgrade also factors in the
weakening in the trust's business risk profile as its revenues and
profitability are expected to be under pressure owing to low
occupancy rates on account of increasing competition from other
education institutions in the Namakkal district.
The rating reflects SSM's exposure to risks relating to intense
competition in the education industry and to the regulatory
environment governing the educational sector. These rating
weaknesses are partially offset by the trust's established
position in the educational sector and its wide range of its
course offerings.
SSM, set up in 1998, operates SSM College of Engineering (SSMCE),
an engineering and post-graduation college, at Komarapalayam
(Tamil Nadu). SSMCE is recognised by the All India Council for
Technical Education and is affiliated to Anna University, Tamil
Nadu.
SUNRISE AGRO: CRISIL Assigns 'B' Rating to INR50MM Loans
--------------------------------------------------------
CRISIL has assigned its 'CRISIL B/Stable' rating to the long-term
bank facilities of Sunrise Agro Industries.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 30 CRISIL B/Stable
Term Loan 20 CRISIL B/Stable
The rating reflects SAI's exposure to risks related to timely
completion and implementation of its ongoing project and its
below-average financial risk profile marked by high gearing and
weak debt protection metrics, driven by debt-funded capital
expenditure for the ongoing project. These rating weaknesses are
partially offset by the benefits that SAI derives from its
promoters' entrepreneurial and industry experience.
Outlook: Stable
CRISIL believes that SAI will continue to benefit over the medium
term from its promoters' extensive experience in the cotton seeds
and de-oiled cake trading business. The outlook may be revised to
'Positive' in case of more-than-expected ramp-up in SAI's scale of
operation and profitability driven by better-than-expected
stabilisation of its new unit. Conversely, the outlook may be
revised to 'Negative' if the firm's financial risk profile,
particularly its liquidity, weakens because of significant
time/cost overruns in its project leading to delay in commencement
of operations resulting in lower-than-expected revenue and cash
accruals.
SAI was set up in May 2013 in Nagpur (Maharashtra) and is promoted
by Mr. Rangarao Gechode, Mr. Dhananjay Adsad, and Mr. Manik
Thakre. SAI is setting up a cotton seed oil extraction unit, which
is expected to start commercial operations in April 2014.
SUPRIYA SPINNING: ICRA Reaffirms B Rating on INR87.63cr Loan
------------------------------------------------------------
ICRA has reaffirmed the long term rating assigned to the INR87.63
crore fund based bank facilities of Supriya Spinning Mills Private
Limited at [ICRA]B. ICRA has also reaffirmed the short term rating
assigned at [ICRA] A4 to the INR25.64 crore of non fund based
facilities of SSMPL.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Fund
Based Limits 87.63 [ICRA]B reaffirmed
Non-Fund Based
Limits 25.64 [ICRA]A4 reaffirmed
The reaffirmation of the ratings continues to factor in the weak
financial profile characterized by high gearing and stretched
coverage indicators although improved during FY13. Further, the
ratings are also constrained by the modest scale of operations and
commoditized nature of the product in the highly fragmented
industry which limits the company's ability to pass on the hike in
input costs. ICRA notes that the company is exposed to regulatory
risk with regards to minimum support price of kappas and curbs on
exports and seasonal nature of raw material availability requires
SSMPL to maintain high inventory holding exposing to price risk.
However, the ratings favourably factor in experience of the
promoters having well established network; operational
efficiencies due to recent vintage of plant and machinery. The
ratings also draw comfort from proximity to a major cotton growing
area, lower power tariff in AP and fiscal incentives under TUF
Scheme.
The ability of the company to improve its profitability, capital
structure and continue to increase its scale of operations would
remain the key rating sensitivities.
Supriya Spinning Mills Private Limited was incorporated in 2005,
based in Guntur district of Andhra Pradesh. The company is engaged
in trading of cotton lint and manufacturing cotton yarn. SSMPL
started its operation with 14,400 spindles and later increased to
31,584 spindles over the last two years. Lint and cotton waste
trading activity is primary focus of the company.
SWAMINARAYAN DIAMONDS: CRISIL Rates INR350MM Loan at 'B+'
---------------------------------------------------------
CRISIL has assigned its 'CRISIL B+/Stable' rating to the long-term
bank facilities of Swaminarayan Diamonds Pvt Ltd (SDPL; part of
the Swaminarayan group).
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 350 CRISIL B+/Stable
The rating reflects Swaminarayan group's below-average financial
risk profile marked by modest net worth, high total outside
liabilities to tangible net worth ratio and below-average debt
protection metrics. Also, the rating reflects the group's low
profitability margins on account of its trading nature of
business. These rating weaknesses are partially offset by the
extensive experience of the Swaminarayan group's promoters in the
diamond industry.
For arriving at its rating, CRISIL has combined the business and
financial risk profiles of SDPL and V Raj Gems (VRG). These
entities, together referred to as the Swaminarayan group, have
common promoters and are in a similar line of business.
Outlook: Stable
CRISIL believes that the Swaminarayan group will benefit over the
medium term from its promoters' extensive experience in the
diamond industry and established relationships with customers. The
outlook may be revised to 'Positive' if there is a substantial and
sustained improvement in the group's profitability margins, while
it registers a healthy revenue growth or there is a substantial
improvement in the group's capital structure on the back of equity
infusion from its promoters. Conversely, the outlook may be
revised to 'Negative' if there is a steep decline in the group's
profitability margins, or there is significant deterioration in
its capital structure on account of larger-than-expected working
capital requirements.
VRG, a partnership firm set up in 2002, trades in rough and
polished diamonds. SDPL, incorporated in November 2012, also
trades in rough and polished diamonds. The group's operations are
managed by Mr. Deepak Patel and his wife Mrs. Sweta Patel.
TCS & ASSOCIATES: ICRA Assigns 'B+' Rating to INR12.50cr Loan
-------------------------------------------------------------
ICRA has reaffirmed the long term rating of '[ICRA]B+' assigned to
the INR7.5 crores cash credit facilities, INR4.24 crores term loan
facilities and INR0.76 crores (enhanced from INR0.61 crores)
unallocated facilities of TCS & Associates Private Limited. Also,
ICRA has assigned a long term rating of [ICRA]B+ to the INR12.5
(enhanced from INR0.0 crores) inventory funding facilities of
TCSA.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Term Loans 4.24 Re-affirmed at [ICRA]B+
Cash Credit 7.50 Re-affirmed at [ICRA]B+
Inventory Funding 12.50 [ICRA]B+ Assigned
Unallocated 0.76 Re-affirmed at [ICRA]B+
The reaffirmation of rating takes into account the ramp up in
volumes of TCS & Associates Private Limited (TCSA) in FY13 and
some improvement in operating performance during the fiscal. The
rating, however, continues to be constrained by the TCSA's weak
financial position on account of high gearing as well as thin
operating margins and low cash accruals. The company is also
exposed to competitive pressures from other dealers MSIL dealers
and other OEMs, especially since the near term demand outlook for
passenger car remains weak. Going forward, the company's ability
to manage its working capital intensity and improve its financial
risk profile would remain the key rating sensitivity.
TCS & Associates Pvt. Ltd. (TCSA) was incorporated in 2002 and
commenced business with Hyundai Motors India Limited. During 2008,
the company received a letter of intent for the dealership of
Maruti Suzuki India Limited (MSIL) for Faridabad district and the
dealership operations for the same started during Q2 FY10. The
company runs one showroom (500 sq. yards) and one workshop (6,600
sq. yards) in Faridabad. TCS's workshop was recently awarded by
MSIL for having the best workshop infrastructure in Northern
India. The company is run by Mr. Sanjeev Saluja who also runs
another dealership (for Bajaj Motorcycles) viz. T.C. Saluja & Sons
Pvt. Ltd.
TECHNOMAX BUILDING: CRISIL Reaffirms D Rating on INR305.6MM Loan
----------------------------------------------------------------
CRISIL's rating on the long-term bank facilities of Technomax
Building Solution India Pvt Ltd (TBS) continues to reflect
instances of delay by TBS in servicing its term debt. The delays
have been caused by the company's weak liquidity, driven by its
working-capital-intensive operations.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 120 CRISIL D (Reaffirmed)
Bank Guarantee 1 CRISIL D (Reaffirmed)
Long Term Loan 25 CRISIL D (Reaffirmed)
Cash Credit 81 CRISIL D (Reaffirmed)
Proposed Long Term
Bank Loan Facility 7.8 CRISIL D (Reaffirmed)
Letter of Credit 10 CRISIL D (Reaffirmed)
Long Term Loan 60.8 CRISIL D (Reaffirmed)
TBS also has a below-average financial risk profile, marked by
high gearing and average debt protection metrics, and a modest
scale of operations in the intensely competitive ready-mix
concrete (RMC) industry. However, TBS benefits from its promoters'
experience in the RMC segment.
Update
TBS reported net sales of INR206.5 million for 2012-13 (refers to
financial year, April 1 to March 31), and is estimated to have
registered revenues of around INR195.5 million for the six months
ended September 30, 2013. The decline in revenues during 2012-13
vis-a-vis the previous year was primarily due to the lower number
of tenders floated by the government.
TBS's financial risk profile remains below average, marked by high
gearing and average debt protection metrics. Its gearing was 2.89
times as on March 31, 2013, while its interest coverage ratio was
around 2.1 times in 2012-13. TBS's operations are working-capital-
intensive in nature; the intensity has been increasing as can be
seen from the increase in its gross current assets to 328 days as
on March 31, 2013, from 163 days as on March 31, 2010. This is
largely driven by high inventory holding. Owing to large working
capital requirements, the company uses its bank line extensively;
the bank limit was fully utilised over the 12 months through
November 2013. CRISIL believes that TBS's liquidity will remain
under pressure over the medium term because of its working-
capital-intensive operations.
TBS, incorporated in June 2008, manufactures RMC, which is used
predominantly in the construction industry. The company is
promoted by Mr. Rangaswami Raju, who also manages its day-to-day
operations.
THAPAR KNITWEAR: CRISIL Reaffirms 'B' Rating on INR150MM Loan
-------------------------------------------------------------
CRISIL's ratings on the bank facilities of Thapar Knitwear Pvt Ltd
(TKPL) continue to reflect TKPL's small scale of operations in the
intensely competitive textiles industry. Also, it reflects the
company's average financial risk profile, marked by average
capital structure and weak debt protection metrics. These rating
weaknesses are partially offset by the extensive experience of
TKPL's promoters in the textiles industry.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 150 CRISIL B/Stable (Reaffirmed)
Outlook: Stable
CRISIL believes that TKPL will continue to benefit over the medium
term from the extensive experience of its promoters in the textile
industry. The outlook may be revised to 'Positive' if the scale of
operations increases significantly, along with improvement in its
profitability and working capital management. Conversely, the
outlook may be revised to 'Negative' in case of a significant
decline in TKPL's profitability or revenues, or if TKPL undertakes
a large debt-funded capital expenditure programme, leading to
deterioration in its financial risk profile.
Update:
For 2012-13 (refers to financial year, April 1 to March 31), TKPL
reported a sale of INR953 million better than CRISIL's expectation
for the period. In 2013-14, TKPL has done a sale of INR750 million
till November 2013, and sales for the complete year are expected
to be INR1 billion. Operating margin was at around 2.85 per cent
in line with CRISIL expectation at 3 per cent in 2012-13. In 2013-
14, TKPL had an operating margin of 3 per cent till November 2013,
and the margin is expected to be at similar levels over the medium
term. TKPL's operations continue to be working capital intensive
with gross current assets (GCA) of 100 days of sale in line with
CRISIL's expectation.
TKPL's financial risk profile will remain average, with average
capital structure and weak debt protection metrics; ratios of
interest coverage and net cash accruals to total debt (NCATD) were
at 1.2 times and 0.03 times, respectively, in 2012-13. Weak debt
protection metrics are on account low operating margin and working
capital intensive operations. CRISIL believes that TKPL's debt
protection metrics will continue to remain weak over the medium
term.
Liquidity remains weak with high bank limit utilisation with cash
accruals sufficient to meet the term debt repayment obligations.
TKPL was established in 2011 and is managed by Mr. Harsh Thapar.
The company manufactures apparels such as blankets, track suits,
quilts, and knitted clothes. The company is based in Ludhiana
(Punjab).
VENKATESH COTTON: CARE Revises Rating on INR9.48cr Loan to 'B+'
---------------------------------------------------------------
CARE revises the rating assigned to the bank facilities of
Venkatesh Cotton Private Limited.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank 9.48 CARE B+ Revised from
Facilities CARE B
Rating Rationale
The revision in the rating assigned to the bank facilities of
Venkatesh Cotton Private Limited is primarily on account of
healthy growth in turnover and improvement in debt coverage
indicators during FY13 (refers to the period April 1 to
March 31). The rating, however, continues to remain constrained on
account of its nascent stage of operations, thin profitability,
leveraged capital structure, susceptibility of operating margins
to fluctuation in cotton price and seasonality associated with the
cotton industry. The rating is further constrained on account of
its working capital intensive nature of operation, presence in the
highly competitive and fragmented cotton ginning business with
limited value addition and susceptibility of the operations to
government regulations.
The rating continues to derive benefit from the experience of the
promoters in the cotton ginning business and proximity to the
cotton-producing regions of Madhya Pradesh.
VCPL's ability to move upward in the textile value chain along-
with an improvement in profit margins, capital structure and debt
coverage indicators remains the key rating sensitivities.
VCPL was incorporated in May 2011 by Mr Deepak Agrawal, Mr Mayank
Agrawal & Mr Gaurav Agrawal for setting up of new ginning and
pressing unit with automization having a capacity of 18,900 MT per
annum. There are two production units of VCPL. One is situated at
Manwath, Maharastra (installed capacity 14,400 MT) and other is
situated at Sendhwa near Indore, Madhya Pradesh (installed
capacity 4,500 MT). Manwath plant is exclusively engaged in cotton
ginning and pressing and the Sendhwa plant is engaged in both
cotton ginning & pressing and oil extraction.
Though the promoters of VCPL are young, their family is engaged in
cotton trading and ginning & pressing business since 25 years. Out
of the total revenue generated during FY13, sales of cotton
bales contributed 76%, sales of cotton seeds contributed 18%,
sales of cotton seed oil cake contributed 4% and sales of cotton
seed oil contributed 2%.
As per the audited results for FY13, VCPL reported a PAT of
INR0.11 crore (INR0.06 crore in FY12) on a TOI of INR45.44 crore
(INR20.07 crore in FY12). During 9MFY14, VCPL has achieved a TOI
of INR26.73 crore.
=========
J A P A N
=========
SONY CORP: To Close Two-Thirds of U.S. Stores
---------------------------------------------
The Associated Press reports that Sony Corp said it is closing
about two-thirds of its U.S. Sony Stores as part of a wide-ranging
company restructuring it announced earlier this month.
It also said that 1,000 of the previously announced 5,000 job cuts
would come from its Sony Electronics unit, mainly in the U.S. and
Mexico, AP relates. The cuts are to take place before March 2015,
the report relays.
According to the news agency, Sony Electronics President Mike
Fasulo said in a statement the moves were "extremely tough" but
were necessary to position the company for future growth.
AP relates that the closings affect 20 Sony Stores in several
states, including five in California and two in Virginia. It is
keeping open 11 Sony Stores including its flagship store in
New York, and several stores in California, New York and Florida,
the report says.
Based in Japan, Sony Corporation -- http://www.sony.net/--engages
in the operation of imaging products and solution (IP&S), game,
mobile products and communication (MP&C), home entertainment and
sound (HE&S), device, movie, music, financial and other business.
The IP&S segment provides digital imaging products and
professional solutions.
As reported in the Troubled Company Reporter-Asia Pacific on
Jan. 29, 2014, Moody's Japan K.K. has downgraded the Issuer Rating
and the long-term senior unsecured bond rating of Sony Corporation
to Ba1 from Baa3. The ratings outlook is stable.
At the same time, Moody's has downgraded the short-term rating of
its supported subsidiary, Sony Global Treasury Services Plc, to
Not Prime from Prime-3.
====================
N E W Z E A L A N D
====================
ROSS ASSET: Investors Frustrated Over House Sale Proceeds
---------------------------------------------------------
NZ Newswire reports that investors who lost millions to convicted
fraudster David Ross said there is a "huge sense of injustice" his
wife will get half the money from the sale of their house.
They also said they are in the dark about efforts to recover some
of the NZ$115 million they invested with New Zealand's biggest
convicted fraudster, NZN relates.
According to the report, Mr. Ross, 63, was last year jailed for 10
years and 10 months after taking the money off at least 700
investors and fiddling the books to make it look as if his shrewd
investing had grown the money to NZ$385 million.
Mr. Ross's Lower Hutt mansion, valued at NZ$2.2 million has now
been sold and while investors will get some, his wife Jillian will
get half the proceeds, NZN says.
The house belonged to a trust set up in 1987, three years before
Ross Asset Management, and it would be difficult to prove investor
money went towards it, liquidator John Fisk told Fairfax Media,
according to NZN.
NZN relates that investor spokesman Bruce Tichbon said investors
were forced to accept the law that said Mrs. Ross would get half
the assets but there is a "huge sense of injustice."
"It's difficult to believe that she had no knowledge of what was
going on, particularly the last three years when it was all over
town that Ross was running a Ponzi scheme," Mr. Tichbon told NZN.
As reported in the Troubled Company Reporter-Asia Pacific on
Nov. 8, 2012, the High Court appointed PricewaterhouseCoopers
partners John Fisk and David Bridgman as Receivers and Managers to
Ross Asset Management Limited and nine other associated entities
following application by the Financial Markets Authority. The
associated entities are:
* Bevis Marks Corporation Limited;
* Dagger Nominees Limited;
* McIntosh Asset Management Limited;
* Mercury Asset Management Limited;
* Ross Investment Management Limited;
* Ross Unit Trusts Management Limited;
* United Asset Management Limited;
* Chapman Ross Trust;
* Woburn Ross Trust;
* Ace Investments Limited or Ace Investment Trust Limited or
Ace Investment Trust;
* Vivian Investments Limited; and
* Ross Units Trusts Limited.
The Receivers and Managers have also been appointed to Wellington
investment adviser David Robert Gilmore Ross personally.
Mr. Fisk said they have identified investments of nearly
NZ$450 million held on behalf of more than 900 investors across
1,720 individual accounts.
The High Court in mid-December ordered John Fisk and David
Bridgman be appointed liquidators of these companies:
-- Ross Asset Management Limited (In Receivership);
-- Bevis Marks Corporation Limited (In Receivership);
-- McIntosh Asset Management Limited (In Receivership); and
-- Mercury Asset Management Limited (In Receivership).
=====================
P H I L I P P I N E S
=====================
RURAL BANK OF SEBASTE: PDIC Files Charges vs. Ex-Pres. & VP
-----------------------------------------------------------
The Philippine Deposit Insurance Corporation (PDIC), statutory
receiver of the closed Rural Bank of Sebaste, Inc. in Antique,
filed on Feb. 4, 2014 with the Department of Justice (DOJ) a
criminal complaint against the former President and the former
Vice President/General Manager of the closed bank for the creation
of fictitious loans.
In its complaint, the PDIC alleged that respondents Eugene T.
Estrella, former President of RB Sebaste, and Norma A. Delgado,
former Vice President/General Manager, directed and caused the
creation of 2,988 fictitious loan accounts between 1997 and 2007
worth around PHP120.1 million, which seriously distorted the
financial report of RB Sebaste.
Bank records showed that RB Sebaste had 3,071 total loan accounts
amounting to PHP131.3 million. The PDIC sent demand letters to the
3,071 purported bank borrowers, but 2,060 of those letters sent
were returned, while 111 of the supposed borrowers denied any loan
transaction with RB Sebaste.
Attached to the complaint is a sworn affidavit of the former
officer-in-charge and cashier of RB Sebaste's head office, which
stated that both Estrella and Delgado gave instructions to their
subordinates to create fictitious or "indirect" loans, while all
management and policy directives emanated from Delgado who
supplied the list of names used in the creation of the loans.
The complaint also indicate that the fictitious loan accounts,
comprising 97% of the bank's loan accounts, did not have credit
folders. A credit folder contains the promissory note, real
estate/chattel mortgage, appraisal report, credit investigation
report, loan and discount release sheet, loan application, board
resolution, and other related documents pertaining to the grant
and release of the loan. The absence of credit folders indicated
deliberate failure to document such loan releases and demonstrated
that the loan accounts were bogus and nonexistent.
RB Sebaste was placed under PDIC receivership by the Monetary
Board on Aug. 24, 2007.
====================
S O U T H K O R E A
====================
TONG YANG: Yuanta Securities Picked as Preferred Bidder
-------------------------------------------------------
Yonhap News Agency reports that Taiwan-based Yuanta Securities was
selected as the preferred bidder for the brokerage arm of the
embattled Tong Yang Group, industry sources said on Feb. 27.
Yuanta Securities, Taiwan's No. 1 brokerage house, submitted a bid
on Feb. 25 for Tongyang Securities Inc., whose parent group has
been suffering from a severe liquidity crunch, Yonhap News
relates.
According to the report, sources said a local court approved a
request by its parent Tong Yang Group to give the Taiwanese
financial firm a preferred bidder status for its brokerage unit.
The stake up for sale is some 27 percent held by the group's
affiliates.
Industry watchers estimated that the price tag could reach some
KRW100 billion (US$93.8 million), Yonhap News notes.
As reported in the Troubled Company Reporter-Asia Pacific Oct. 3,
2013, The Korea Times said Tongyang Group Chairman Hyun Jae-hyun
is likely to lose his control of the company as five affiliates
have filed for court protection to avoid bankruptcy. Tongyang
Group confirmed that in only two days from September 30 through
October 1, five Tongyang affiliates -- Tongyang Inc., Tongyang
Leisure, Tongyang International, Tongyang Networks and Tongyang
Cement & Energy -- all filed for the court-led debt rescheduling
program after they failed to pay maturing debts valued at
KRW110 billion. Following the receivership applications, the
Seoul Central District Court will decide on whether to give the
go-ahead to the protection request by Tongyang affiliates or to
let them go belly up and liquidate, the report noted.
Tong Yang Group is a South Korean conglomerate founded in 1957 as
a cement manufacturer. The company through its subsidiaries,
engages in constructing houses, and roads and harbors. Its
products include ready mixed concrete, PHC piles, admixture, low
heat cement, low-heat portland cement, portland cement, and blast
furnace slag cement.
===============
X X X X X X X X
===============
* Large Companies with Insolvent Balance Sheets
-----------------------------------------------
Total
Total Shareholders
Assets Equity
Company Ticker (US$MM) (US$MM)
------- ------ ------ ------------
AUSTRALIA
AAT CORP LTD AAT 32.50 -13.46
ANITTEL GROUP LT AYG 18.43 -0.26
ATLANTIC LTD ATI 490.17 -25.68
AUSTRALIAN ZI-PP AZCCA 77.75 -2.57
AUSTRALIAN ZIRC AZC 77.75 -2.57
BIRON APPAREL LT BIC 19.71 -2.22
BOUNTY MINING LT BNT 10.54 -0.94
CLARITY OSS LTD CYO 33.12 -11.66
CMA CORP LTD CMV 127.41 -51.00
CWH RESOURCES LT CWH 10.71 -3.03
IDM INTERNATIONA IDM 30.99 -23.62
LIONHUB GROUP LT LHB 19.21 -26.52
MIRABELA NICKEL MBN 335.09 -179.03
NATURAL FUEL LTD NFL 19.38 -121.51
PACT GROUP HOLDI PGH 1,120.30 -982.11
PENRICE SODA HOL PSH 122.46 -26.85
RIVERCITY MOTORW RCY 386.88 -809.13
RUBICOR GROUP LT RUB 45.20 -75.31
STERLING PLANTAT SBI 59.08 -6.07
STIRLING RESOURC SRE 16.53 -8.12
STRAITS RESOURCE SRQ 208.51 -29.73
SWAN GOLD MINING SWA 36.43 -9.08
TZ LTD TZL 12.88 -8.73
CHINA
ANHUI GUOTONG-A 600444 79.12 -10.53
CHANG JIANG-A 520 770.91 -176.56
CHINA GREAT LAND CGL 16.52 -19.01
CHINA OILFIELD T COT 22.00 -16.71
FORGAME HOLDINGS 484 83.73 -21.92
HEBEI BAOSHUO -A 600155 114.00 -104.15
HULUDAO ZINC-A 751 507.79 -532.25
HUNAN TIANYI-A 908 59.37 -1.14
JIANGSU ZHONGDA 600074 338.59 -29.88
NANNING CHEMIC-A 600301 391.41 -43.60
QINGDAO YELLOW 600579 122.36 -71.04
QINGHAI SUNSHI-A 600381 394.70 -78.28
SHENZ CHINA BI-A 17 28.50 -283.65
SHENZ CHINA BI-B 200017 28.50 -283.65
SHIJIAZHUANG D-A 958 241.31 -111.50
SHUNFENG PHOTOVO 1165 411.73 -51.06
TAIYUAN TIANLO-A 600234 63.28 -17.71
WUHAN BOILER-B 200770 217.13 -213.03
WUHAN XIANGLON-A 600769 77.45 -103.43
YUNNAN JINGGU FO 600265 84.92 -2.90
HONG KONG
BIRMINGHAM INTER 2309 59.95 -12.80
BUILDMORE INTL 108 17.36 -70.34
CHINA ENVIRONMEN 986 66.65 -0.87
CHINA HEALTHCARE 673 34.76 -0.75
CHINA OCEAN SHIP 651 248.21 -106.72
CNC HOLDINGS 8356 99.16 -9.03
CROSBY CAPITAL 8088 16.40 -20.27
EFORCE HLDGS LTD 943 60.73 -9.56
GRANDE HLDG 186 255.10 -208.18
INNO-TECH HLDGS 8202 84.54 -116.82
LANGHAM -SS 1270 684.55 -86.21
LONG SUCCESS INT 8017 50.05 -7.44
MASCOTTE HLDGS 136 57.51 -81.70
MEGA EXPO HOLDIN 1360 17.00 -0.53
MELCOLOT LTD 8198 13.69 -28.83
NORSTAR FOUNDERS 2339 21.97 -56.33
PALADIN LTD 495 159.65 -9.17
PROVIEW INTL HLD 334 314.87 -294.85
SINO RESOURCES G 223 29.34 -24.77
SURFACE MOUNT SMT 32.88 -10.68
VXL CAPITAL LTD 727 74.79 -0.16
INDONESIA
APAC CITRA CENT MYTX 176.66 -6.99
ARPENI PRATAMA APOL 249.84 -319.77
ASIA PACIFIC POLY 375.58 -815.83
BUMI RESOURCES BUMI 7,027.47 -18.17
ICTSI JASA PRIMA KARW 56.41 -6.12
JAKARTA KYOEI ST JKSW 24.92 -34.90
MATAHARI DEPT LPPF 209.66 -89.74
ONIX CAPITAL TBK OCAP 13.22 -1.03
RENUKA COALINDO SQMI 15.84 -0.48
SUMALINDO LESTAR SULI 95.14 -18.99
UNITEX TBK UNTX 18.83 -18.53
INDIA
ABHISHEK CORPORA ABSC 53.66 -25.51
AGRO DUTCH INDUS ADF 85.09 -22.81
ALPS INDUS LTD ALPI 201.29 -41.70
AMIT SPINNING AMSP 12.85 -7.68
ARTSON ENGR ART 11.81 -10.16
ASHAPURA MINECHE ASMN 161.89 -51.58
ASHIMA LTD ASHM 63.23 -48.94
ATV PROJECTS ATV 48.47 -43.93
BELLARY STEELS BSAL 451.68 -108.50
BENZO PETRO INTL BPI 26.77 -1.05
BHAGHEERATHA ENG BGEL 22.65 -28.20
BLUE BIRD INDIA BIRD 122.02 -59.13
CELEBRITY FASHIO CFLI 24.96 -8.26
CHESLIND TEXTILE CTX 20.51 -0.03
CLASSIC DIAMONDS CLD 66.26 -6.84
COMPUTERSKILL CPS 14.90 -7.56
DCM FINANCIAL SE DCMFS 18.46 -9.46
DFL INFRASTRUCTU DLFI 42.74 -6.49
DIGJAM LTD DGJM 99.41 -22.59
DISH TV INDIA DITV 579.01 -28.55
DISH TV INDI-SLB DITV/S 579.01 -28.55
DUNCANS INDUS DAI 122.76 -227.05
ENSO SECUTRACK ENSO 15.57 -0.46
EURO CERAMICS EUCL 110.62 -6.83
EURO MULTIVISION EURO 36.94 -9.95
FERT & CHEM TRAV FCT 311.92 -35.19
GANESH BENZOPLST GBP 44.05 -15.48
GANGOTRI TEXTILE GNTX 54.67 -14.22
GOKAK TEXTILES L GTEX 46.36 -0.29
GOLDEN TOBACCO GTO 97.40 -18.24
GSL INDIA LTD GSL 29.86 -42.42
GSL NOVA PETROCH GSLN 16.53 -1.31
GUJARAT STATE FI GSF 10.26 -303.64
GUPTA SYNTHETICS GUSYN 44.18 -6.34
HARYANA STEEL HYSA 10.83 -5.91
HEALTHFORE TECHN HTEC 14.74 -46.64
HINDUSTAN ORGAN HOC 74.72 -24.07
HINDUSTAN PHOTO HPHT 49.58 -1,832.65
HMT LTD HMT 108.71 -572.12
ICDS ICDS 13.30 -6.17
INDAGE RESTAURAN IRL 15.11 -2.35
INTEGRAT FINANCE IFC 49.83 -51.32
JCT ELECTRONICS JCTE 80.08 -76.70
JENSON & NIC LTD JN 16.49 -71.70
JET AIRWAYS IND JETIN 3,368.77 -335.45
JET AIRWAYS -SLB JETIN/S 3,368.77 -335.45
JOG ENGINEERING VMJ 45.90 -5.28
KALYANPUR CEMENT KCEM 23.39 -42.66
KERALA AYURVEDA KERL 13.97 -1.69
KIDUJA INDIA KDJ 11.16 -3.43
KINGFISHER AIR KAIR 515.93 -2,371.26
KINGFISHER A-SLB KAIR/S 515.93 -2,371.26
KITPLY INDS LTD KIT 14.77 -58.78
KLG SYSTEL LTD KLGS 40.64 -27.37
LML LTD LML 43.95 -78.18
MADRAS FERTILIZE MDF 167.72 -56.20
MAHA RASHTRA APE MHAC 14.49 -12.96
MAHANAGAR TELE MTNL 4,845.41 -511.72
MAHANAGAR TE-SLB MTNL/S 4,845.41 -511.72
MALWA COTTON MCSM 44.14 -24.79
MILTON PLASTICS MILT 17.67 -51.22
MODERN DAIRIES MRD 38.61 -3.81
MOSER BAER INDIA MBI 727.13 -165.63
MOSER BAER -SLB MBI/S 727.13 -165.63
MTZ POLYFILMS LT TBE 31.94 -2.57
MURLI INDUSTRIES MRLI 262.39 -38.30
MYSORE PAPER MSPM 87.99 -8.12
NATL STAND INDI NTSD 22.09 -0.73
NAVCOM INDUS LTD NOP 10.19 -3.53
NICCO CORP LTD NICC 71.84 -4.91
NICCO UCO ALLIAN NICU 23.25 -83.90
NK INDUS LTD NKI 141.35 -7.71
NRC LTD NTRY 63.70 -53.01
NUCHEM LTD NUC 24.72 -1.60
PANCHMAHAL STEEL PMS 51.02 -0.33
PARAMOUNT COMM PRMC 124.96 -0.52
PARASRAMPUR SYN PPS 99.06 -307.14
PAREKH PLATINUM PKPL 61.08 -88.85
PIONEER DISTILLE PND 53.74 -5.62
PREMIER INDS LTD PRMI 11.61 -6.09
PRIYADARSHINI SP PYSM 20.80 -2.28
QUADRANT TELEVEN QDTV 150.43 -137.48
QUINTEGRA SOLUTI QSL 16.76 -17.45
RAMSARUP INDUSTR RAMI 433.89 -89.28
RATHI ISPAT LTD RTIS 44.56 -3.93
RELIANCE BROADCA RBN 86.97 -0.59
RELIANCE MEDIAWO RMW 425.22 -21.31
RELIANCE MED-SLB RMW/S 425.22 -21.31
RENOWNED AUTO PR RAP 14.12 -1.25
RMG ALLOY STEEL RMG 66.61 -12.99
ROLLATAINERS LTD RLT 22.97 -22.24
ROYAL CUSHION RCVP 14.70 -75.18
SAAG RR INFRA LT SAAG 12.54 -4.93
SADHANA NITRO SNC 16.74 -0.58
SANATHNAGAR ENTE SNEL 49.23 -6.78
SANCIA GLOBAL IN SGIL 78.82 -25.13
SBEC SUGAR LTD SBECS 92.44 -5.61
SCOOTERS INDIA SCTR 19.75 -13.35
SERVALAK PAP LTD SLPL 61.57 -7.63
SHAH ALLOYS LTD SA 168.13 -81.60
SHALIMAR WIRES SWRI 22.79 -27.18
SHAMKEN COTSYN SHC 23.13 -6.17
SHAMKEN MULTIFAB SHM 60.55 -13.26
SHAMKEN SPINNERS SSP 42.18 -16.76
SHREE GANESH FOR SGFO 44.50 -2.89
SHREE KRISHNA SHKP 14.62 -0.92
SHREE RAMA MULTI SRMT 38.90 -4.49
SIDDHARTHA TUBES SDT 75.90 -11.45
SIMBHAOLI SUGAR SBSM 268.76 -54.47
SITI CABLE NETWO SCNL 219.45 -9.68
SPICEJET LTD SJET 563.64 -41.19
SQL STAR INTL SQL 10.58 -3.28
STATE TRADING CO STC 826.29 -276.56
STELCO STRIPS STLS 14.90 -5.27
STI INDIA LTD STIB 21.69 -2.13
STL GLOBAL LTD SHGL 30.73 -5.62
STORE ONE RETAIL SORI 15.48 -59.09
SUPER FORGINGS SFS 14.62 -7.00
SURYA PHARMA SUPH 370.28 -9.97
TAMILNADU JAI TNJB 17.07 -1.00
TATA METALIKS TML 156.70 -5.36
TATA TELESERVICE TTLS 1,311.30 -138.25
TATA TELE-SLB TTLS/S 1,311.30 -138.25
TODAYS WRITING TWPL 18.58 -25.67
TRIUMPH INTL OXIF 58.46 -14.18
TRIVENI GLASS TRSG 19.71 -10.45
TUTICORIN ALKALI TACF 19.86 -19.58
UDAIPUR CEMENT W UCW 11.38 -10.53
UNIFLEX CABLES UFCZ 47.46 -7.49
UNIWORTH LTD WW 149.50 -151.14
UNIWORTH TEXTILE FBW 22.54 -35.03
USHA INDIA LTD USHA 12.06 -54.51
VANASTHALI TEXT VTI 14.59 -5.80
VENUS SUGAR LTD VS 11.06 -1.08
WANBURY LTD WANB 141.86 -3.91
JAPAN
FLIGHT HOLDINGS 3753 10.10 -2.62
GOYO FOODS INDUS 2230 11.79 -1.51
HARAKOSAN CO 8894 186.55 -8.07
IDEA INTERNATION 3140 23.66 -0.08
KANMONKAI CO LTD 3372 42.64 -0.81
KOREA
DVS KOREA CO LTD 46400 17.40 -1.20
ORIENTAL PRECISI 14940 224.92 -79.83
ROCKET ELEC-PFD 425 111.09 -0.42
ROCKET ELECTRIC 420 111.09 -0.42
SHINIL ENG CO 14350 199.04 -2.53
SSANGYONG ENGINE 12650 1,231.13 -119.47
STX OFFSHORE & S 67250 7,627.42 -1,124.38
TEC & CO 8900 139.98 -16.61
TONGYANG NETWORK 30790 311.91 -36.46
WOONGJIN HOLDING 16880 2,197.34 -635.50
MALAYSIA
HAISAN RESOURCES HRB 41.31 -11.54
HIGH-5 CONGLOMER HIGH 41.63 -34.19
HO HUP CONSTR CO HO 59.28 -16.64
PETROL ONE RESOU PORB 51.39 -4.00
SUMATEC RESOURCE SMTC 169.12 -26.18
VTI VINTAGE BHD VTI 17.74 -3.63
NEW ZEALAND
NZF GROUP LTD NZF NZ Equity 11.69 -4.60
PULSE ENERGY LTD PLE NZ Equity 11.29 -3.44
PHILIPPINES
CYBER BAY CORP CYBR 14.14 -21.59
FIL ESTATE CORP FC 40.90 -15.77
FILSYN CORP A FYN 23.11 -11.69
FILSYN CORP. B FYNB 23.11 -11.69
GOTESCO LAND-A GO 21.76 -19.21
GOTESCO LAND-B GOB 21.76 -19.21
LIBERTY TELECOMS LIB 108.53 -19.42
MRC ALLIED INC MRC 27.06 -2.56
PICOP RESOURCES PCP 105.66 -23.33
STENIEL MFG STN 21.07 -11.96
UNIWIDE HOLDINGS UW 50.36 -57.19
SINGAPORE
ADVANCE SCT LTD ASCT 19.68 -22.46
CEFC INTL LTD SUNE 95.25 -0.31
HL GLOBAL ENTERP HLGE 83.11 -4.63
IGG INC 8002 21.53 -55.84
SCIGEN LTD-CUFS SIE 68.70 -42.35
SUNMOON FOOD COM SMOON 20.26 -17.36
TT INTERNATIONAL TTI 298.35 -82.84
UNITED FIBER SYS UFS 65.52 -56.60
THAILAND
ABICO HLDGS-F ABICO/F 15.28 -4.40
ABICO HOLDINGS ABICO 15.28 -4.40
ABICO HOLD-NVDR ABICO-R 15.28 -4.40
ASCON CONSTR-NVD ASCON-R 59.78 -3.37
ASCON CONSTRUCT ASCON 59.78 -3.37
ASCON CONSTRU-FO ASCON/F 59.78 -3.37
BANGKOK RUBBER BRC 77.91 -114.37
BANGKOK RUBBER-F BRC/F 77.91 -114.37
BANGKOK RUB-NVDR BRC-R 77.91 -114.37
CALIFORNIA W-NVD CAWOW-R 28.07 -11.94
CALIFORNIA WO-FO CAWOW/F 28.07 -11.94
CALIFORNIA WOW X CAWOW 28.07 -11.94
CIRCUIT ELEC PCL CIRKIT 16.79 -96.30
CIRCUIT ELEC-FRN CIRKIT/F 16.79 -96.30
CIRCUIT ELE-NVDR CIRKIT-R 16.79 -96.30
DATAMAT PCL DTM 12.69 -6.13
DATAMAT PCL-NVDR DTM-R 12.69 -6.13
DATAMAT PLC-F DTM/F 12.69 -6.13
ITV PCL ITV 36.02 -121.94
ITV PCL-FOREIGN ITV/F 36.02 -121.94
ITV PCL-NVDR ITV-R 36.02 -121.94
K-TECH CONSTRUCT KTECH 38.87 -46.47
K-TECH CONSTRUCT KTECH/F 38.87 -46.47
K-TECH CONTRU-R KTECH-R 38.87 -46.47
KUANG PEI SAN POMPUI 17.70 -12.74
KUANG PEI SAN-F POMPUI/F 17.70 -12.74
KUANG PEI-NVDR POMPUI-R 17.70 -12.74
MANGPONG 1989 PC MPG 11.83 -0.91
MANGPONG 1989 PC MPG/F 11.83 -0.91
MANGPONG 19-NVDR MPG-R 11.83 -0.91
PATKOL PCL PATKL 52.89 -30.64
PATKOL PCL-FORGN PATKL/F 52.89 -30.64
PATKOL PCL-NVDR PATKL-R 52.89 -30.64
PICNIC CORP-NVDR PICNI-R 101.18 -175.61
PICNIC CORPORATI PICNI 101.18 -175.61
PICNIC CORPORATI PICNI/F 101.18 -175.61
SAHAMITR PRESS-F SMPC/F 27.92 -1.48
SAHAMITR PRESSUR SMPC 27.92 -1.48
SAHAMITR PR-NVDR SMPC-R 27.92 -1.48
SHUN THAI RUBBER STHAI 19.89 -0.59
SHUN THAI RUBB-F STHAI/F 19.89 -0.59
SHUN THAI RUBB-N STHAI-R 19.89 -0.59
SUNWOOD INDS PCL SUN 19.86 -13.03
SUNWOOD INDS-F SUN/F 19.86 -13.03
SUNWOOD INDS-NVD SUN-R 19.86 -13.03
TONGKAH HARBOU-F THL/F 62.30 -1.84
TONGKAH HARBOUR THL 62.30 -1.84
TONGKAH HAR-NVDR THL-R 62.30 -1.84
TRANG SEAFOOD TRS 15.18 -6.61
TRANG SEAFOOD-F TRS/F 15.18 -6.61
TRANG SFD-NVDR TRS-R 15.18 -6.61
TT&T PCL TTNT 589.80 -223.22
TT&T PCL-NVDR TTNT-R 589.80 -223.22
TT&T PUBLIC CO-F TTNT/F 589.80 -223.22
WORLD CORP -NVDR WORLD-R 15.72 -10.10
WORLD CORP PCL WORLD 15.72 -10.10
WORLD CORP PLC-F WORLD/F 15.72 -10.10
TAIWAN
BEHAVIOR TECH CO 2341S 30.90 -0.22
BEHAVIOR TECH-EC 2341O 30.90 -0.22
HELIX TECH-EC 2479T 23.39 -24.12
HELIX TECH-EC IS 2479U 23.39 -24.12
HELIX TECHNOL-EC 2479S 23.39 -24.12
POWERCHIP SEM-EC 5346S 2,036.01 -52.74
TAIWAN KOL-E CRT 1606U 507.21 -147.14
TAIWAN KOLIN-EN 1606V 507.21 -147.14
TAIWAN KOLIN-ENT 1606W 507.21 -147.14
*********
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
publication in any form (including e-mail forwarding,
electronic re-mailing and photocopying) is strictly prohibited
without prior written permission of the publishers.
Information contained herein is obtained from sources believed
to be reliable, but is not guaranteed.
TCR-AP subscription rate is US$775 for 6 months delivered via e-
mail. Additional e-mail subscriptions for members of the same
firm for the term of the initial subscription or balance
thereof are US$25 each. For subscription information, contact
Peter Chapman at 215-945-7000 or Nina Novak at 202-241-8200.
*** End of Transmission ***