/raid1/www/Hosts/bankrupt/TCRAP_Public/140508.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
Thursday, May 8, 2014, Vol. 17, No. 90
Headlines
A U S T R A L I A
BUTLER'S HARDWARE: Jirsch Sutherland Appointed as Administrators
MIRABELA NICKEL: Inks Amended Credit Deal With Banco Bradesco
R.M. WILLIAMS: Agent Gets Considerable Interest From Local Buyers
REDZED TRUST: S&P Assigns Prelim. BB Rating to Class E Notes
C H I N A
JINGRUI HOLDINGS: Fitch Publishes 'B' IDR; Outlook Stable
* CHINA: Central Bank Vows to Step Up Monitoring of Loan Default
I N D I A
AKSHAR SKYWARDS: CRISIL Assigns 'B+' Rating to INR200MM Loan
BHARAT INDUSTRIAL: ICRA Reaffirms 'B+' Rating on INR3.20cr Loan
CALICA EXPORTS: ICRA Withdraws 'B+/A4' Rating on INR5cr Loan
COOL DECK: ICRA Reaffirms 'B+' Rating on INR12.4cr Loans
FRIENDS INTERNATIONAL: ICRA Suspends 'B+' Rating on INR11cr Loan
GLOVE INFRACON: ICRA Assigns 'B' Rating to INR5.20cr Loans
GOLDEN INTERNATIONAL: ICRA Reaffirms 'B+' Rating on INR6.5cr Loan
GURUTEK ESTATE: ICRA Downgrades Rating on INR16cr Loan to 'C+'
JAYSHRI GINNING: CRISIL Ups Rating on INR250MM Loans to 'B+'
JINDAL TIMBER: ICRA Reaffirms 'B+' Rating on INR2cr LT Loan
JRK INDUSTRIES: ICRA Reaffirms 'B-' Rating on INR8cr Loans
KAUSHIK GLOBAL: ICRA Suspends 'D' Rating on INR30cr Loan
LIKHITA PROCESS: CRISIL Reaffirms 'B+' Rating on INR65MM Loans
MAHA MARUTI: ICRA Suspends 'B' Rating on INR11.2cr Loan
MAHESH EXTRUSIONS: CRISIL Ups Rating on INR75.1MM Loans to 'B-'
MANIKANTA COTTON: ICRA Assigns 'B-' Rating to INR16cr Loans
MOTI INDUSTRIES: ICRA Suspends 'B+' Rating on INR10cr Loan
MOTIA TOWNSHIP: ICRA Lowers Rating on INR23cr Bank Loan to 'B'
NIRBHAI TEXTILES: CRISIL Reaffirms 'B-' Rating on INR180MM Loans
NDT TECHNOLOGIES: ICRA Assigns 'B+' Rating to INR9.80cr Loans
PICCADILY HOTELS: CARE Assigns B+ Rating to INR234.29cr Bank Loan
PVSRSN ENTERPRISE: CRISIL Reaffirms 'D' Rating on INR300MM Loans
ROCKLAND HOTELS: ICRA Reaffirms 'B+' Rating on INR11.29cr Loans
SACHIN FINECOT: CRISIL Raises Rating on INR89MM Loans to 'B+'
SARTHAK CREATION: CRISIL Cuts Rating on INR661.7MM Loans to 'D'
SHRI KRISHNA: ICRA Reaffirms 'B+' Rating on INR10.67cr Loans
SHRI LAXMAN: CARE Downgrades Rating on INR6.11cr Bank Loan to 'D'
SRI VAISHNAVI: CRISIL Reaffirms 'C' Rating on INR256.8MM Loans
SUZLON ENERGY: Discloses Cashless Restructuring of $485MM Bonds
U G CONSTRUCTIONS: CRISIL Rates INR70MM Cash Credit at 'B'
UNIVERSAL CONSTRUCTION: CARE Cuts Rating on INR43.97cr Loan to B+
VISHAL COATERS: CRISIL Reaffirms 'B+' Rating on INR120MM Loans
J A P A N
TOKYO ELECTRIC: Posts JPY438.65 Billion Annual Net Profit
N E W Z E A L A N D
LOMBARD FINANCE: Ex-Directors Win Appeal vs. Custodial Sentences
ROSS ASSET: David Ross Granted Time Out of Prison
SOUTH CANTERBURY FINANCE: Witness Swamped by Hyatt Loan Data
P A K I S T A N
PAKISTAN: Moody's Caa1 Gov't Bond Rating Reflects Financing Needs
- - - - -
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A U S T R A L I A
=================
BUTLER'S HARDWARE: Jirsch Sutherland Appointed as Administrators
----------------------------------------------------------------
Sule Arnautovic and Roderick Mackay Sutherland of Jirsch
Sutherland were appointed as administrators of Butler's Hardware
Pty Ltd on May 1, 2014.
A first meeting of the creditors of the Company will be held at
Jirsch Sutherland, Level 4, 55 Hunter Street, in Sydney, on
May 13, 2014, at 11:00 a.m.
MIRABELA NICKEL: Inks Amended Credit Deal With Banco Bradesco
-------------------------------------------------------------
Mirabela Nickel Limited advises that the Company, in its capacity
as guarantor, has entered into an Amended Credit Agreement with
Banco Bradesco S.A, extending the date for the repayment of
outstanding principal of US$47 million to March 29, 2018. As part
of the amendments, Bradesco has also agreed to provide in
principle support for, and not take any adverse action as a result
of, the proposed restructure and recapitalisation of the Company
to be undertaken as part of the proposed deed of company
arrangement.
Mirabela Mineracao do Brasil Ltda as borrower will provide
Bradesco a security interest over the receivables under the
existing short term offtake agreement with an International
Trading House (ITH) up to the earlier of July 23, 2014, and the
date on which an offtake agreement is executed with any party with
respect to the 50% of sales of nickel concentrate not the subject
of the Norilsk offtake agreement.
In addition to the existing security held by Bradesco over the 50%
of sales currently the subject of the Norilsk offtake agreement,
Mirabela Brazil will provide Bradesco a replacement security
interest over this 50% of the receivables if the Norilsk agreement
is terminated or not renewed upon its expiration and a new offtake
agreement is entered into with an alternate party.
The Agreement also includes a mechanic for the early repayment of
the Principal Outstanding dependent upon the available cash flow
on certain dates and subject to minimum cash balances.
Interest remains payable pursuant to the Agreement on a bi-annual
basis.
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 kilometres
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.
Martin Madden, Clifford Rocke, and David Winterbottom 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.
R.M. WILLIAMS: Agent Gets Considerable Interest From Local Buyers
-----------------------------------------------------------------
ABC News reports that the agent selling Henbury Station in Central
Australia said there has been 'considerable' interest, and it has
only been from domestic buyers.
R.M. Williams Agricultural Holdings (RMWAH) bought the cattle
station, 230 kilometres south of Alice Springs, for AUD13 million
in 2011, the report says.
ABC relates that the Federal Government contributed AUD9 million
towards the purchase, under a deal that saw the property destocked
of cattle for a carbon farming project.
But Henbury went up for sale in August last year after the parent
company RMWAH went into receivership, the report notes.
Six weeks ago the receivers, PPB Advisory, decided to re-market
the property as a pastoral lease, according to ABC.
According to the report, sale agent, Jock McPherson, said there
has been interest from potential buyers from the Northern
Territory, New South Wales, Queensland, South Australia, Western
Australia.
"It's a fully fledged pastoral lease, that's the way it's being
marketed, and that's the way it will remain in the future," the
report quotes Mr. McPherson as saying. "It's a mix of
individuals, as well as groups and organisations."
ABC says Mr. McPherson would not be drawn on whether there has
been any offers close to the previous price tag of AUD13 million,
but said he expects it to be 'strong'.
He said there has been no real interest from conservation groups
and said the use of the property as a conservation site is now
'out of the question,' ABC relays.
Tenders close on May 23. Mr. McPherson is confident of getting a
buyer, but it's still not clear who will get the proceeds from the
sale, the report adds.
R.M. Williams Agricultural Holdings went into receivership on July
10, 2013.
REDZED TRUST: S&P Assigns Prelim. BB Rating to Class E Notes
------------------------------------------------------------
Standard & Poor's Ratings Services assigned its preliminary
ratings to eight of the nine classes of residential mortgage-
backed securities (RMBS) to be issued by Perpetual Trustee Co.
Ltd. as trustee of the RedZed Trust in respect of Series 2014-1.
RedZed Trust in respect of Series 2014-1 is a securitization of
subprime residential mortgages originated by RedZed Lending
Solutions Pty Ltd.
The preliminary ratings reflect:
-- S&P's view of the credit risk of the underlying collateral
portfolio, including the fact that this is a closed
portfolio, which means no further loans will be assigned to
the trust after the closing date.
-- S&P's view that the credit support is sufficient to
withstand the stresses it applies. This credit support
comprises note subordination for each class of rated note.
-- The availability of a retention amount, amortization
amount, and yield enhancement reserve, which will all be
funded by excess spread, but at various stages of the
transaction's term. They will have separate functions and
timeframes, including reducing the balance of senior notes,
reducing the balance of the most subordinated rated notes,
and paying senior expenses and interest shortfalls on the
class A notes.
-- The extraordinary expense reserve of A$150,000, funded from
day one and available to meet extraordinary expenses. The
reserve will be topped up via excess spread if drawn.
-- S&P's expectation that the various mechanisms to support
liquidity within the transaction, including a liquidity
facility equal to 2.5% of the outstanding balance of the
notes, and principal draws, are sufficient under S&P's
stress assumptions to ensure timely payment of interest.
-- The condition that a minimum margin will be maintained on
the mortgage assets.
A copy of Standard & Poor's complete report for RedZed Trust in
respect of Series 2014-1 can be found on RatingsDirect, Standard &
Poor's Web-based credit analysis system.
The issuer has not informed Standard & Poor's (Australia) Pty
Limited whether the issuer is publically disclosing all relevant
information about the structured finance instruments the subject
of this rating report or whether relevant information remains non-
public.
STANDARD & POOR'S 17G-7 DISCLOSURE REPORT
SEC Rule 17g-7 requires an NRSRO, for any report accompanying a
credit rating relating to an asset-backed security as defined in
the Rule, to include a description of the representations,
warranties and enforcement mechanisms available to investors and a
description of how they differ from the representations,
warranties and enforcement mechanisms in issuances of similar
securities.
The Standard & Poor's 17g-7 Disclosure Report included in this
credit rating report is available at:
http://standardandpoorsdisclosure-17g7.com/2436.pdf
REGULATORY DISCLOSURES
Please refer to the initial rating report for any additional
regulatory disclosures that may apply to a transaction.
PRELIMINARY RATINGS ASSIGNED
Class Rating Amount (mil. A$)
A-1 AAA (sf) 75.00
A-2 AAA (sf) 22.50
A-3 AAA (sf) 16.80
B AA (sf) 9.75
C A (sf) 9.60
D BBB (sf) 6.90
E BB (sf) 4.20
F B (sf) 2.85
G N.R. 2.40
N.R.--Not rated.
=========
C H I N A
=========
JINGRUI HOLDINGS: Fitch Publishes 'B' IDR; Outlook Stable
---------------------------------------------------------
Fitch Ratings has published China-based residential property
developer Jingrui Holdings Limited's (Jingrui) Long-Term Issuer
Default Rating (IDR) of 'B' with a Stable Outlook and senior
unsecured rating of 'B'. Fitch has also assigned Jingrui's
proposed US dollar senior unsecured notes an expected rating of
'B(EXP)'.
The notes are rated at the same level as Jingrui's senior
unsecured rating as they represent direct, unconditional,
unsecured and unsubordinated obligations of the company. The final
rating of the proposed notes is contingent upon receipt of
documents conforming to information already received.
Jingrui is a pure residential developer targeting first-time
homebuyers and upgraders. It initially developed projects in
Shanghai in the early 2000s, but later ventured into third-tier
cities in Jiangsu and Zhejiang provinces in 2006. Currently, its
projects are mainly located in second- and third-tier cities in
the Yangtze River Delta area.
KEY RATING DRIVERS
Fast Churn-Out Lowers Margins: Jingrui adopted the fast churn-out
model in 2013 by starting construction and launching project
presales three months and six months after land acquisitions
respectively. For example, it recently launched the presales of a
Hangzhou project 148 days after it purchased the land. This model
helped Jingrui increase sales by a strong 76% to CNY8.3bn in 2013.
Fitch expects Jingrui's turnover rate, measured by contracted
sales over total debt, to rise from 1.1x in 2013 to more than 1.5x
in 2014. However, the fast churn-out model reduces profit margins,
as developers benefit less from property price appreciation and
have to sell at competitive prices to ensure high sell-through
rates. Fitch expects Jingrui's gross profit margin to remain low
at 20%-25% in the next two to three years.
Low Market Penetration: Jingrui currently has between one and
three projects that mostly have less than CNY1bn in annual
contracted sales in each of the 15 cities in Jiangsu and Zhejiang
provinces where it has operations. Fitch believes that Jingrui
could enjoy economies of scale and higher profit margins if it
concentrates on building its market presence and brand name in a
few of these cities.
High Leverage among Peers: Jingrui's leverage, measured by net
debt over adjusted inventory, has been at high levels in the past
few years. It fell slightly to 44% at end-2013 after its IPO, from
49% at end-2012. In comparison, most of the other residential
developers rated 'B' or 'B+' had leverage below 40%. Jingrui plans
to spend CNY7.5bn on land purchases in 2014, much more than the
CNY4.5bn cash outflow for land purchases in 2013. As Jingrui is in
the expansion stage, Fitch expects its leverage to rise to close
to 50% in 2014. Higher-than-expected capex or weaker-than-expected
contracted sales performance may drive its leverage further above
50%.
Heavy Cash Outlay: Jingrui has a small landbank of 5.0 million
square metres. As such, Fitch expects Jingrui to spend significant
amounts on land acquisitions and project construction in order to
support its target of strong sales growth over the next few years.
Jingrui relies heavily on cash flow from contracted sales and
banks' construction loans to finance its operations. The ambitious
expansion plan may increase the risk of liquidity crunch in times
of a property market slowdown or liquidity tightening. Jingrui
will consider developing projects with JV partners to lower its
capital outlay.
Sufficient Liquidity to Repay Debt: At end-2013, Jingrui had cash
of CNY3.4bn and undrawn credit facilities of CNY565m, which should
be sufficient to cover short-term debt maturing in 2014 of CNY3bn.
RATING SENSITIVITIES
Positive: Future developments that may collectively lead to
positive rating actions include:
- Net debt/adjusted inventory sustained below 40% (end-2013:
44.2%); and
- EBITDA margin sustained above 18% (2013: 12%); and
- Maintaining its current strategy of fast churn-out model, such
that contracted sales/total debt is sustained at over 1.3x (2013:
1.1x).
Negative: Factors that may, individually or collectively, lead to
negative rating action include:
- Net debt/ adjusted inventory sustained above 60%
- EBITDA margin sustained below 15%
- Contracted sales/total debt sustained below 1.0x.
* CHINA: Central Bank Vows to Step Up Monitoring of Loan Default
----------------------------------------------------------------
The Wall Street Journal reports that China's central bank said it
would strengthen monitoring of default risk from loans to the
property sector, local-government financing companies and
industries struggling with overcapacity.
In its first-quarter monetary report, the People's Bank of China
said on May 6 that it would aim to prevent these risks from
spreading more widely through the financial sector, the Journal
relates. The Journal notes that several smaller property
developers have defaulted on loans in recent months amid slower
growth in the housing market and the economy overall. This has
raised concerns over the ability of some borrowers, particularly
those in the property sector as well as in the solar-panel, cement
and steel industries, to repay loans to banks, the report relates.
According to the Journal, the central bank said on its website
that authorities will set up a policy framework to address risk
and manage potential crises. It didn't give any details about this
framework or elaborate on these possible crises, the report
relays. The Journal adds that the central bank would push ahead
with plans to roll out a bank deposit insurance mechanism, a much-
discussed objective that has been on the agenda for some time.
China currently has no deposit insurance, but authorities are
widely believed to be willing to stand behind any troubled bank in
the country's state-dominated financial system. The need for
deposit insurance has become more evident as the central bank
opens the industry to more private capital, the Journal notes.
=========
I N D I A
=========
AKSHAR SKYWARDS: CRISIL Assigns 'B+' Rating to INR200MM Loan
------------------------------------------------------------
CRISIL has assigned its 'CRISIL B+/Stable' rating to the proposed
long-term bank facilities of Akshar Skywards Construction (ASC).
Amount
Facilities (INR Mln) Ratings
---------- -------- -------
Proposed Long Term 200 CRISIL B+/Stable
Bank Loan Facility
The rating reflects ASC's exposure to execution and off take risks
associated with its ongoing residential project. This rating
weakness is partially offset by the extensive experience of ASC's
partners in real estate development.
Outlook: Stable
CRISIL believes that ASC will continue to benefit over the medium
term from the extensive experience of its partners in the real
estate business. The outlook may be revised to 'Positive' if the
firm generates higher-than-expected cash flow from operations
resulting from improved advances from its ongoing project.
Conversely, the outlook may be revised to 'Negative' if KR reports
significantly lower-than-expected cash flow from operations,
either because of subdued response to its project or lower-than-
envisaged flow of advances, impacting its debt servicing ability.
ASC was set up in 2010 as a partnership firm and is engaged in
real estate development. The partners of the firm are Mr.
Bachubhai Arethiya, Mr.Kanji Arethiya, Mr. Khimji Arethiya, Mr.
Kishor Mujat, Mr.Himanshu Thakker, Mr. Rohan Nahata and Mr.Rahul
Nahata. Currently the company is undertaking a 4 towers G+12
residential real estate project named 'Altorios' at Hadapsar
(Pune).
BHARAT INDUSTRIAL: ICRA Reaffirms 'B+' Rating on INR3.20cr Loan
---------------------------------------------------------------
ICRA has reaffirmed the long term rating of '[ICRA]B+' for the
INR3.20 crore fund based bank facilities and short term rating of
'[ICRA]A4' for the INR6.55 crore fund based and non fund based
facilities of Bharat Industrial Corporation. ICRA has also
assigned a rating of [ICRA]B+/A4 to the unallocated limits of BIC.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term fund
based limits 3.20 [ICRA]B+ reaffirmed
Fund base & non
fund based limits 6.55 [ICRA]A4 reaffirmed
Unallocated 0.25 [ICRA]B+/A4 assigned
ICRA's rating reaffirmation takes into consideration the high
competitive intensity and fragmented nature of incense sticks
industry which has resulted in moderate profitability. Further the
ratings are also constrained by the high working capital intensive
nature of the operations, due to high levels of debtors and need
to maintain the raw material inventory. The high working capital
intensity and significant reduction in net worth of the firm from
INR7.10 crores to INR2.61 crores in FY13 due to withdrawals by the
partners has resulted in leveraged capital structure. Further the
ratings are also constrained by inherent risks associated with the
partnership model as in limited ability to raise equity capital,
risk of dissolution etc.
The ratings however draw comfort from the long presence of the
firm in the industry for over 40 years, presence in domestic and
various exports markets including the Middle-East Asia and North
Africa, demonstrated ability of the firm to innovate according to
the customer requirements. Going forward, the firm's ability to
increase revenues keeping in check the profitability, working
capital intensity are the key rating sensitivities.
Established in 1965, Bharat Industrial Corporation is a
partnership firm engaged in manufacturing and marketing of incense
sticks. It manufactures agarbattis (incense sticks), Dhoop Cones
and dhoop sticks of various brands and sells the product in
domestic and export market. The products are also sold in USA,
Middle East, and African Countries like Egypt etc as well as South
East Asian Countries.
Recent Results
In FY2013, BIC has reported an operating profit of INR3.20 Cr and
profit before tax of INR1.76 Cr on an operating income of INR39.82
Cr and PBT of INR2.48 crore in FY2012
CALICA EXPORTS: ICRA Withdraws 'B+/A4' Rating on INR5cr Loan
------------------------------------------------------------
ICRA has withdrawn the '[ICRA]B+' and '[ICRA]A4' rating assigned
to the INR5.00 crore fund based facilities of Calica Exports, at
the request of the company. There is no amount outstanding against
the rated instrument.
COOL DECK: ICRA Reaffirms 'B+' Rating on INR12.4cr Loans
--------------------------------------------------------
ICRA has reaffirmed the long-term rating to '[ICRA]B+' for the
INR10.90 Crore (earlier INR9.40 crore) Fund-Based Bank Facility
and INR1.50 Crore (earlier INR1.00 crore) bank guarantees of Cool
Deck Aqua Solutions Private Limited. ICRA has reaffirmed the
short term rating at '[ICRA]A4' for the short term Non-fund based
INR3.00 Crore (earlier INR5.00 crore) facilities of CDASPL.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Fund Based Limits (CC) 6.00 [ICRA]B+ (reaffirmed)
Term Loan 4.90 [ICRA]B+ (reaffirmed)
Non-Fund Based Limits (BG) 1.50 [ICRA]B+ (reaffirmed)
Non-Fund based Limits (LC) 3.00 [ICRA]A4 (reaffirmed)
The rating reaffirmation take into account the stressed financial
profile of the company, with losses reported for FY2014
(provisional nos.), on account of weaker operating environment
leading to execution delays. The company face elongated receivable
periods, thereby worsening its working capital cycle and thus
higher borrowing costs. The company however recently got some
relief from bank in the form of moratorium on term loan and
conversion of its short term non-fund based liabilities into long
term loans, which is expected to improve the liquidity position of
the company in near term. The ratings continues to factor in the
small size of operations of the company, exposure to intense
competition due to presence of large unorganized sector and
susceptibility to raw material price fluctuations mainly PVC
resin. The rating however favorably factors in promoters
established experience in cooling water related business and
reputed client base at present.
Cool Deck Aqua Solutions Private Limited is an ISO 9001:2000
certified company. The company's core business involves
manufacturing of plastic components for cooling towers and
water/wastewater treatment plants. The company was incorporated in
2005.CDASPL - through its headquarters in Mumbai, India and 20,000
square feet of manufacturing space in the union territory of
Daman, India has been working with OEMs as well as end customers
in varied fields of manufacturing. CDASPL reported a net loss of
INR3.45 Crore on an operating income of INR29.54 Crore for FY
2012-13.
Recent results:
CDASPL reported a net loss of INR0.49 Crore (provisional) on an
operating income of INR34.41 Crore for 2013-14 compared to a net
loss of INR3.45 Cr (audited) on an operating income of INR29.54 Cr
for 2012-13.
FRIENDS INTERNATIONAL: ICRA Suspends 'B+' Rating on INR11cr Loan
----------------------------------------------------------------
ICRA has suspended the '[ICRA]B+' rating assigned to the INR11.0
crore fund based facilities of Friends International. 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.
GLOVE INFRACON: ICRA Assigns 'B' Rating to INR5.20cr Loans
----------------------------------------------------------
ICRA has assigned an '[ICRA]B' rating to the INR5 crore cash
credit facility and INR0.20 crore untied term loan of the company.
ICRA has also assigned an '[ICRA]A4' rating to the INR2.80 crore
bank guarantee of Glove Infracon Private Limited.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Fund Based Limit- 5.00 [ICRA]B assigned
Cash Credit
Fund Based Limit- 0.20 [ICRA]B assigned
Term Loan (untied)
Non Fund Based 2.80 [ICRA]A4 assigned
Limit-Bank Guarantee
While assigning the ratings, ICRA has taken into account GIPL's
small scale of current operations. ICRA also notes that the future
business performance of GIPL, in regard to achieving expected
revenue growth while maintaining performance parameters in
accordance with the contracts, is contingent upon the company's
ability to ramp-up its execution capabilities and resources,
including financial resources. The ratings are constrained by the
highly competitive nature of the construction industry wherein
business is procured on a tender based contract awarding system,
which keeps margins of all the players including GIPL under check
and high sectoral and geographical concentration risks as its
current operations are restricted to bridge construction in the
state of Assam. The ratings, however, positively considers the
experience of the promoters in the civil construction business
through their group entity along with the presence of price
escalation clause in the current contract which mitigates the
vulnerability of profitability to the variation in the raw
material cost to a large extent.
Incorporated in November 2011, GIPL is engaged in the road &
bridge construction activity in the state of Assam.
Recent Results
During the first nine months of 2013-14, the company reported
operating profit of INR0.18 crore (provisional) on an operating
income of INR0.81 crore (provisional) against a net profit of
INR0.01 crore on an operating income of INR0.09 crore in 2012-13.
GOLDEN INTERNATIONAL: ICRA Reaffirms 'B+' Rating on INR6.5cr Loan
-----------------------------------------------------------------
ICRA has reaffirmed the long term rating assigned to INR6.50 Crore
fund based bank facilities of Golden International Private Limited
at '[ICRA]B+'. The rating suspension done in September 2013 has
been revoked.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Fund 6.50 [ICRA]B+ (Re-affirmed)
Based Limits
The rating continues to take into account GIPL's small scale of
operations in a low value added business of wholesaling and
retailing home textiles, which coupled with intense competition on
account of fragmented nature of home textile industry, is expected
to keep the profitability under pressure. Further, while ICRA is
cognizant of GIPL's increased focus on retailing business and
resulting improvement in operating margins during past few years,
it is noted that return on capital employed continues to remain
modest as sizeable funds have been deployed in non cash returning
investments in sister concerns. Moreover, incremental accruals
from operations are being consistently extended as
advances/investments to group companies, whereby debt level is not
declining despite modest profitability and stagnant working
capital requirements due to stagnant operations. Thus, the stable
debt levels coupled with modest (though improving) accruals
continue to result in moderate debt metrics. The up-streaming of
cash accruals to group companies coupled with working capital
intensive nature of operations due to high inventory levels also
continue to drive weak liquidity profile as reflected in
consistently high utilization of working capital limits.
Going forward, ability of GIPL to grow while sustaining healthy
operating margins and prudently manage working capital intensity
of operations would remain key rating sensitivities besides the
extent of funding support extended to group companies.
Incorporated in the year 2007, Golden International Private
Limited is promoted by Mr. Ved Parkash Chugh and Mrs. Anu Chugh.
The company has set up a large home furnishing outlet covering an
area of about 40,000 sq ft. at G.T. Road, Panipat, Haryana; and is
primarily engaged in wholesaling and retailing of various types of
home textiles like curtains, bed sheets, blankets and terry
towels. GIPL belongs to 'Golden Group' of Panipat, which is also
engaged in manufacturing of various textile products like towels,
bath robes, carpets, rugs, blankets etc.
In FY2013, GIPL reported an Operating Income (OI) of INR19.8 Crore
and Operating Profit before Depreciation, Interest, Tax and
Amortisation (OPBDITA) of INR2.0 Crore against OI of INR18.8 Crore
and OPBITDA of INR1.3 Crore reported in FY2012.
GURUTEK ESTATE: ICRA Downgrades Rating on INR16cr Loan to 'C+'
--------------------------------------------------------------
ICRA has downgraded the long term rating of Gurutek Estate Private
Limited from '[ICRA]B' to '[ICRA]C+' for INR16.0 crore Fund Based
limits. ICRA has reaffirmed the short term rating of GEPL at
'[ICRA]A4' for INR4.0 crore Non-Fund Based Bank Limits.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Fund Based Facilities 16.0 [ICRA]C+ (Downgraded)
Non-Fund Based Facilities 4.0 [ICRA]A4 (Reaffirmed)
The rating revision continues to factor in the slow sales progress
in GEPL's on-going project resulting in high market risks for the
company. Furthermore, the customer advances have been lower than
expected which increases the funding risks for the project given
the high dependence on customer advances for project funding.
Also, GEPL has significant debt repayment obligations due in
FY2015 which will warrant significant funding support from the
promoters in the absence of adequate customer advances. The
ratings continue to be constrained on account of execution risks
associated with the project which is still in the initial stage of
implementation, though majority of the approvals have been
secured. ICRA notes that the region of GEPL's upcoming project is
likely to see high competitive pressures given that a number of
townships are under construction by established builders which can
put pressure on company's sales volume. The ratings, however take
comfort from the established track record of GEPL's promoters in
the construction sector in the National Capital Region (NCR).
Going forward, GEPL's ability to improve its sales momentum, meet
its construction schedule, as well as ensure timely debt repayment
obligations would be the key rating sensitivities.
Gurutek Estate Private Limited is incorporated with the purpose of
developing a 51 acre Township in Sector 25 & 26, Rewari, Haryana.
Apart from developing the entire township, the company will also
construct residential flats and a commercial complex in the
township. The company is promoted by Mr. Kamal Agarwal who is also
the Managing Director in GEPL. The majority shareholding in GEPL
is through Gurutek India Private Limited which is another company
owned by the same promoters and is involved in construction
business. This is the first real estate project as a developer for
the promoters and their prior experience has been limited towards
construction of real estate projects only.
The township is named Gurutek Eshan Vatikka and is being
constructed on 51 acre land which has been purchased from Pioneer
Urban Development Private Limited in December 2010 for a
consideration of about INR18.5 crore and the same has been fully
paid for.
In the township, company plans to sell 227 plots of different
sizes and 243 group housing flats. Of this, it had sold 51 flats
and 136 plots by the end of March 2014. The construction is
currently in the initial stages of implementation and out of the
total INR71.3 crore spent towards project cost by the end of
March 2014, only INR16.8 crore has been spent towards project
development.
JAYSHRI GINNING: CRISIL Ups Rating on INR250MM Loans to 'B+'
------------------------------------------------------------
CRISIL has upgraded its rating on the long-term bank facilities of
Jayshri Ginning and Spinning Pvt Ltd to 'CRISIL B+/Stable' from
'CRISIL B/Stable'.
Amount
Facilities (INR Mln) Ratings
---------- -------- -------
Cash Credit 150 CRISIL B+/Stable (Upgraded
from 'CRISIL B/Stable')
Proposed Long Term
Bank Loan Facility 100 CRISIL B+/Stable (Upgraded
from 'CRISIL B/Stable')
The rating upgrade reflects CRISIL's belief that JGSPL's financial
risk profile will continue to improve over the medium term backed
by improvement in capital structure and debt protection metrics.
The company's revenue is estimated to have grown by 40 to 45 per
cent year-on-year during 2013-14 (refers to financial year, April
1 to March 31) because of moderate demand from customers. Healthy
growth in topline is expected to result in moderate annual
accruals of around INR17 million over the medium term. Improvement
in accruals resulted in increase in net worth to an estimated
INR80 million as on March 31, 2014, from INR57 million as on March
31, 2013; increase in net worth will help the company improve its
gearing to 1.6 to 1.8 times over the near term from historical
high of 2.5 to 3.0 times. With prudent raw material management,
its operating margin improved to 5.0 per cent during 2012-13 from
2.2 per cent during 2011-12. Improvement in profitability and
accruals led to improvement in debt protection metrics. The
company's interest coverage and net cash accruals to total debt
ratios are expected at around 2.0 times and 0.11 times,
respectively, over the medium term.
The rating continues to reflect JGSPL's modest financial risk
profile marked by modest net worth and debt protection metrics,
and its susceptibility to regulatory changes. These rating
weaknesses are partially offset by the strong track record of
JGSPL's promoters in the cotton ginning industry.
Outlook: Stable
CRISIL believes that JGSPL will continue to benefit over the
medium term from its promoters' extensive industry experience. The
outlook may be revised to 'Positive' if JGSPL's scale of
operations increases substantially, along with sustained
improvement in profitability, resulting in large accruals, or if
its capital structure improves significantly, driven most likely
by equity infusion. Conversely, the outlook may be revised to
'Negative' if the company's financial risk profile deteriorates,
most likely because of more-than-expected increase in working
capital borrowings or debt-funded capital expenditure, weakening
its capital structure and liquidity.
JGSPL was set up as a partnership firm in 2005 by Mr. Parbatbhai
Bavanjibhai and his family members and was reconstituted as a
private limited company. The company undertakes ginning and
pressing of raw cotton. The company is based in Rajkot district
(Gujarat).
JGSPL reported a net profit of INR6.7 million on net sales of
INR600.8 million for 2012-13, against a net loss of INR6.9 million
on net sales of INR711.1 million for 2011-12.
JINDAL TIMBER: ICRA Reaffirms 'B+' Rating on INR2cr LT Loan
-----------------------------------------------------------
ICRA has reaffirmed the long term rating of '[ICRA]B+' to the
INR2.00 crores fund based bank facilities of Jindal Timber &
Plywood Private Limited. ICRA has also reaffirmed the short term
rating of '[ICRA]A4' to the INR16.00 crores Non- fund based
facilities of JTPPL.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Fund based limits- 2.00 [ICRA]B+ reaffirmed
Long Term
Non-Fund based limits 16.00 [ICRA]A4 reaffirmed
Short Term
The reaffirmation of the ratings continues to take into account
relatively low value additive and highly competitive nature of the
business which has resulted in below average margins in this
business which is unlikely to change significantly in the medium
term. Further, the entire timber requirement is met through
imports (in USD) and the import payables are not completely hedged
by the company exposing the company to exchange rate fluctuations.
However, the business risk profile draws comfort from the long
experience of promoters.
Recent Results
JTPPL reported a net profit of INR0.08 crores on an operating
income of INR37.85 crores for the year ended March 31, 2013 and a
net profit of INR0.06 crores on an operating income of INR35.52
crores for the year ended March 31, 2012.
JTPPL is a privately owned company that was incorporated in March
2009. Directors of the company are Mr. Ramesh Jain & Mr. Dinesh
Jain. Both the directors are actively engaged in the working of
the business. The company imports timber mainly from Malaysia, New
Zealand, Burma and Germany. The variety of timber that the company
deals in is mainly used in furniture making and light construction
work. The company's Head office located at Karnal (Haryana) and
branch office located at Gandhidham (Gujarat) is engaged in
cleaning and sawing of logs to make clean squared timber blocks.
All the sawn timber produced at its Gandhidham (Gujarat) factory
is sold from its office in Karnal in Haryana, and Gandhidham in
Gujarat.
JRK INDUSTRIES: ICRA Reaffirms 'B-' Rating on INR8cr Loans
----------------------------------------------------------
ICRA has reaffirmed the long term rating of '[ICRA]B-' for the
INR8.00 crore fund based limits and unallocated limits of JRK
Industries Private Limited.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Fund Based Limits 6.35 [ICRA]B- reaffirmed
Unallocated 1.65 [ICRA]B- reaffirmed
The rating reaffirmation takes into account JRK's moderate scale
of operations (operating income of INR22.9 crore during FY2013),
high competitive intensity of the industry, and the company's
exposure to raw material price volatility. These factors have led
to thin operating margins, which coupled with high interest costs
have resulted in continued losses at the net level. The rating is
also constrained by pressure on JRK's liquidity position mainly on
account of high receivable levels, as evidenced by negative cash
generation from operations and full utilization of working capital
limits. High working capital borrowings coupled with low net worth
on account of accumulated losses have translated into high gearing
of 7.22 times as on March 31, 2013 and weak debt coverage
indicators (interest cover of 0.32 times, total debt/OPBDITA of
25.9 times as on March 31, 2013). However, the rating takes into
consideration the long experience of JRK's promoters in the steel
industry, its reputed client base and established relationship
with the top clients as reflected by repeat orders, and support
from promoters in the form of equity infusion and unsecured loans
to fund losses in the past. ICRA also noted the anticipated growth
in turnover on account of association with Tata Steel Limited
(TSL) for job work manufacturing of wires and cables.
JRK Industries Private Limited was established in 1997 by Mr.
Radha Krishan Jalan and is engaged in the manufacturing of low
carbon galvanized wire and armoring land cables. The manufacturing
facility is situated in Jaipur and has an installed capacity of
18000 MT per annum. The key raw material for the manufacturing of
steel wire is wire rod which is primarily procured from Tata Steel
Limited, Steel Authority of India Limited, Vizag Steel Plant and
Jindal Steel & Power Limited.
The company reported a net loss after tax of INR1.13 crore on an
operating income of INR22.95 crore during FY2013 as against a loss
of 1.34 crore on an operating income of INR32.39 crore during
FY2012.
KAUSHIK GLOBAL: ICRA Suspends 'D' Rating on INR30cr Loan
--------------------------------------------------------
ICRA has suspended the long term rating of '[ICRA]D' assigned to
the INR30.00 crore fund based bank facilities of Kaushik Global
Logistics 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.
LIKHITA PROCESS: CRISIL Reaffirms 'B+' Rating on INR65MM Loans
--------------------------------------------------------------
CRISIL's rating on the long-term bank facilities of Likhita
Process Industries continue to reflect LPI's below-average
financial risk profile, marked by high gearing and average debt
protection metrics, and its susceptibility to cyclicality in
demand from its end-user industry. These rating weaknesses are
partially offset by the extensive industry experience of the
firm's promoter.
Amount
Facilities (INR Mln) Ratings
---------- -------- -------
Cash Credit 45 CRISIL B+/Stable (Reaffirmed)
Proposed Cash Credit
Limit 20 CRISIL B+/Stable (Reaffirmed)
Outlook: Stable
CRISIL believes that LPI will continue to benefit over the medium
term from the extensive industry experience of its promoter and
its established relationships with customers. The outlook may be
revised to 'Positive' in case of a sustained increase in the
firm's scale of operations and profitability, along with better
working capital management, leading to improvement in its
financial risk profile. Conversely, the outlook may be revised to
'Negative' if LPI registers lower-than-expected revenue,
undertakes a substantial debt-funded capital expenditure
programme, or extends any fund support to its associate entities,
resulting in deterioration in its financial risk profile.
LPI, set up in 2005, manufactures windmill tower internals. The
firm is managed by its promoter-director, Mr. T Yellamanda Reddy.
LPI reported net sales of INR162.6 million for 2012-13 (refers to
financial year, April 1 to March 31), against net sales of
INR316.8 million for 2011-12.
MAHA MARUTI: ICRA Suspends 'B' Rating on INR11.2cr Loan
-------------------------------------------------------
ICRA has suspended '[ICRA]B' rating assigned to INR11.20 crore
bank facilities of Maha Maruti Logistics 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.
MAHESH EXTRUSIONS: CRISIL Ups Rating on INR75.1MM Loans to 'B-'
---------------------------------------------------------------
CRISIL has upgraded its ratings on the bank facilities of Mahesh
Extrusions Ltd to 'CRISIL B-/Stable/CRISIL A4' from 'CRISIL
D/CRISIL D'.
Amount
Facilities (INR Mln) Ratings
---------- -------- -------
Bank Guarantee 5 CRISIL A4 (Upgraded from
'CRISIL D')
Cash Credit 59 CRISIL B-/Stable (Upgraded
from 'CRISIL D')
Letter of Credit 55 CRISIL A4 (Upgraded from
'CRISIL D')
Proposed Long Term 1.9 CRISIL B-/Stable (Upgraded
Bank Loan Facility from 'CRISIL D')
Rupee Term Loan 14.2 CRISIL B-/Stable (Upgraded
from 'CRISIL D')
The rating upgrade reflects improvement in MEL's liquidity driven
by a sustained improvement in receivables collection cycle and
increasing cash accruals leading to timely servicing of debt
obligations over the four months through March 2014. The upgrade
factors in CRISIL's expectations that over the medium term, MEL's
liquidity will be adequate to service its debt repayment
obligations, ably supported by the absence of any capital
expenditure plans and sustenance of the receivables collections
cycle.
The rating reflects MEL's below-average financial risk profile,
marked by weak capital structure and average debt protection
metrics, and its modest scale of operations in competitive pipes
and fittings industry. These rating weaknesses are partially
offset by the extensive industry experience of MEL's promoters.
Outlook: Stable
CRISIL believes that MEL will continue to benefit over the medium
term from its promoter's extensive industry experience. The
outlook may be revised to 'Positive' if the company reports
significantly higher-than-expected cash accruals or substantial
equity infusion thus improving its financial risk profile.
Conversely, the outlook may be revised to 'Negative' in case of
deterioration in the financial risk profile, particularly, its
liquidity, most likely because of decline in profitability, or
elongation in the working capital cycle.
MEL, based in Karnataka, was established in 1991 by Mr. A Prasad
Shetty and Mr. S P Y Reddy. The company manufactures Polyvinyl
Chlorides (PVC) and High-density Polyethylene (HDPE) pipes which
are used in construction and agriculture industries.
MANIKANTA COTTON: ICRA Assigns 'B-' Rating to INR16cr Loans
------------------------------------------------------------
ICRA has assigned a long term rating of '[ICRA]B-' to INR15.85
crore fund based and INR0.15 Cr of non-fund based facilities of
Manikanta Cotton Agro Industries. The assigned rating is
constrained by running delays in project execution by 9 months on
account of change.
The assigned rating is primarily constrained by the weak financial
profile characterized by low profitability; high gearing coupled
with stretched coverage indicators in FY14. The rating is also
constrained by the small scale of operations and fragmented nature
of industry with high competition from large number of players
which limits the ability of players to pass on the hike in the
input costs. ICRA notes the inherent agro-climatic risks which
could affect both the availability and cost of raw material and
also the risks inherent in the partnership nature of the firm.The
rating however favourably factors in more than two decades of
experience of promoters in cotton industry and proximity to cotton
growing areas of Andhra Pradesh (AP) which results in lower
transportation costs and better availability of raw material
The ability of the company to stabilize and increase its scale of
operations while maintaining its profitability would remain the
key rating sensitivities.
Manikanta Cotton Agro Industries was setup as a partnership firm
in 2013 by Mr. D Malla Reddy and Mr.P.Ravinder Reddy and 6 other
partners, with ginning activity as its main operations. The firm
has its production facility located at Muthannapeta village
(Karimnagar District), Andhra Pradesh with installed capacity of
36 gins and 1 press. The unit commenced operations in December
2013.
MOTI INDUSTRIES: ICRA Suspends 'B+' Rating on INR10cr Loan
----------------------------------------------------------
ICRA has suspended the '[ICRA]B+' rating assigned to the INR10.00
crore fund based facilities of Moti Industries. The suspension
follows ICRA's inability to carry out a rating surveillance in the
absence of the requisite information from the company.
Moti Industries (MI) is engaged in ginning and pressing of raw
cotton to produce cotton seeds and cotton bales. The business is
managed jointly by Mr. Kuldeep Patel, Mr. Diabhai Patel & Mr.
Govardhanbhai Patel, who took over the firm from Mr. Aakash Patel
in 2007. The plant is located at Shapar, Rajkot (Gujarat). The
firm is equipped with 24 ginning machines and one fully automated
pressing machine. Before taking over Moti Industries, the
promoters were involved in Kuldeep Cotton Industries however the
promoters sold the firm to other partners in 2006.
MOTIA TOWNSHIP: ICRA Lowers Rating on INR23cr Bank Loan to 'B'
--------------------------------------------------------------
ICRA has revised the rating assigned to INR23.00 Crore bank
facilities of Motia Township Private Limited to '[ICRA]B' from
'[ICRA]B+'.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Fund 23.00 [ICRA]B (Downgraded)
Based Facilities
The downward revision in rating takes into account prolonged
weakness in sales momentum despite appealing price range for
economy segment buyers and considerable time elapsed since launch
of project. While the project was launched in February 2012, only
26% of launched area was sold till February 2014. Further, owing
to high dependence on customer advances in funding mix, the timely
execution of project will remain highly dependent upon incremental
sales and timely collections from customers. Correspondingly,
given the slower pace of sales, the pace of construction has
slowed during past one year, whereby, despite the passage of
almost two years since commencement of construction work, only
~32% construction cost has been incurred (till February 2014)
towards ongoing phase of the project. ICRA notes that while the
Company has low committed receivables of less than INR10 Crore,
the pending construction cost for ongoing phase is about INR70
Crore. Thus, timely execution of project and debt servicing
ability will continue to remain highly dependent upon incremental
sales and timely collections from customers, thereby augmenting
company's exposure to market risk for the unsold area on account
of inherent cyclicality of the sector. Also, while ICRA continues
to take into account satisfactory track record of promoter group
in real estate market of Chandigarh and its satellite towns with
their completed residential projects fully sold and occupied by
residents; however, it is noted that scale of the project being
executed by MTPL is large in relation to past developments
concluded by MTPL, thereby exposing it to execution risks.
Going forward, ability of the company to successfully market
unsold apartment inventory while maintaining healthy collection
efficiency to improve the pace of project execution would remain
key rating sensitivity.
Motia Township Private Limited, promoted by 'Motia Group', is
developing an integrated township named 'Motia Oasis' at Zirakpur
(Punjab). The envisaged project is proposed to house more than
1,100 residential units and 66 commercial/retail units spread
across 24 acres and encompassing a saleable area of about 2.4
million square feet (msf). The aforesaid project is being
developed in phased manner wherein about 300 residential units and
66 retail units have been launched till date. The estimated
project cost for ongoing phases is about INR120 crore, which the
company is partially funding with a INR23 crore term loan.
NIRBHAI TEXTILES: CRISIL Reaffirms 'B-' Rating on INR180MM Loans
----------------------------------------------------------------
CRISIL's rating on the long-term bank facilities of Nirbhai
Textiles Pvt Ltd continues to reflect NTPL's weak financial risk
profile, marked by moderate gearing and weak debt protection
metrics; the rating also factors in the company's small scale of
operations, susceptibility to volatility in raw material prices,
and increased working capital requirements. These rating
weaknesses are partially offset by the extensive industry
experience of NTPL's promoters.
Amount
Facilities (INR Mln) Ratings
---------- -------- -------
Cash Credit 157 CRISIL B-/Stable (Reaffirmed)
Term Loan 23 CRISIL B-/Stable (Reaffirmed)
Outlook: Stable
CRISIL believes that NTPL will continue to benefit over the medium
term from its promoters' extensive experience in the textile
industry. However, the company's liquidity is expected to remain
constrained by its large working capital requirements during the
same period. The outlook may be revised to 'Positive' if NTPL's
revenue grows more than expected, along with improved
profitability, or if the company's working capital management
improves, leading to improved debt protection metrics and
liquidity. Conversely, the outlook may be revised to 'Negative' if
NTPL's financial risk profile deteriorates further, most likely
because of larger-than-expected debt-funded capital expenditure or
lower-than-expected operating margin.
Update
NTPL has reported healthy improvement in its business risk
profile, marked by increased scale of operations and increased net
worth; however constrained by weak liquidity. The company is
estimated to report an operating income of INR1890.2 million in
2013-14 (refers to financial year, April 1 to March 31) from
INR1331.1 million in 2012-13. Additionally, the company is
estimated to report a stable operating margin in the range of 6.5
to 7.5 per cent in 2013-14. However, NTPL's operations are
working-capital-intensive, resulting in proportionate increase in
working capital requirement. Therefore, the total debt of the
company is estimated to increase to about INR500 million in March
31, 2014, from INR376 million a year earlier. NTPL's financial
risk profile is expected to remain weak, marked by increase in
gearing to about 1.4 times in 2013-14 from 1.18 times in the
previous year. However, the company's debt protection metrics are
estimated to remain weak, marked by interest coverage and net cash
accruals to total debt ratios at 1.96 times and 0.10 times,
respectively, in 2013-14. NTPL's liquidity remains weak on account
of large incremental working capital requirements estimated to be
about INR227.9 million in 2013-14; against this, the company is
estimated to generate cash accruals in the range of INR50 million
to INR60 million over the same period. This has meant that the
company has had to depend on external borrowing to fund large
incremental working capital requirements.
For 2012-13, NTPL reported a profit after tax (PAT) of INR19.3
million on net sales of INR1.33 billion, against a PAT of INR13.9
million on net sales of INR1.11 billion for 2011-12. The company
is estimated to report net sales of INR1.89 billion in 2013-14.
NTPL, incorporated in 1994 and promoted by Mr. Pramod Kumar in
Ludhiana (Punjab), manufactures suiting and shirting fabrics. The
promoters have been trading in fabrics in Gujarat and Punjab since
1975. NTPL has capacity to manufacture about 7.6 million metres of
fabric per annum.
NDT TECHNOLOGIES: ICRA Assigns 'B+' Rating to INR9.80cr Loans
-------------------------------------------------------------
ICRA has assigned a long-term rating of '[ICRA]B+' to the INR3.20
crore working capital facilities, the INR3.05 crore term loans and
the INR3.55 crore proposed long-term limits of NDT Technologies
Private Limited. ICRA has also assigned a short-term rating of
'[ICRA]A4' to the INR5.20 crore short-term non fund-based working
capital limits of NDTT.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long term fund 3.20 [ICRA]B+ assigned
based working
capital limits
Term Loans 3.05 [ICRA]B+ assigned
Other proposed long
term limits 3.55 [ICRA]B+ assigned
Short term non-fund
based limits 5.20 [ICRA]A4 assigned
The assigned ratings take into the company's experienced
management, its strong technological expertise and its reputed
client base. The ratings also favourably factor in the company's
adequate financial risk profile marked by healthy profitability
indicators and comfortable debt coverage indicators. NDTT has a
healthy order book of ~INR38 crore as on February 2014, which is
to be executed over the next 12 months, providing revenue
visibility. The ratings, however, remain constrained by the modest
revenue base of the company. Its debt funded capital expenditures
and rise in working capital requirements over the last two fiscals
are expected to keep the credit profile constrained over the
medium term. NDTT's revenues the trading segment also remains
vulnerable to foreign exchange fluctuations. Going forward, timely
order execution and debtor realisations will remain a key rating
sensitivity.
NDT Technologies Private Limited was incorporated in 2002 by Mr.
Anil Nair, Mr. Mukesh Arora and Mr. Hitesh Mohanlal as a
partnership firm. In CY2005, the entity was converted into a
Private Limited Company with the partners continuing as Directors.
In CY2006, Mr. Mukesh Arora opted for retirement and Mr.
Somasekaran Nair was appointed as a Director. The firm is engaged
in the trading and servicing of Non Destructible Testing
instruments.
Recent results
As per audited results for FY2013, NDTT reported a profit after
tax (PAT) of INR0.53 crore over an operating income (OI) of
INR7.26 crore, as against a PAT of INR0.49 crore on an OI of
INR5.96 crore in FY2012.
PICCADILY HOTELS: CARE Assigns B+ Rating to INR234.29cr Bank Loan
-----------------------------------------------------------------
CARE assigns 'CARE B+' rating to the bank facilities of Piccadily
Hotels Pvt Limited.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank 234.29 CARE B+ Assigned
Facilities
Rating Rationale
The rating assigned to the bank facilities of Piccadily Hotels Pvt
Ltd is constrained by the weak operating performance of its
properties leading to the weak financial risk profile of the
company marked by leveraged capital structure and stressed debt
coverage indicators. The rating also factors in the recent history
of debt restructuring and subdued industry outlook of the Indian
hospitality industry. The rating however, draws strength from the
experience of the promoters, long track record of operations and
operating and marketing arrangement for its two hotel properties
with Hyatt International.
Going forward, the company's ability to improve its average room
revenue (ARR) and occupancy levels for all the hotel properties
would remain the key rating sensitivities.
Incorporated in 1973, PHPL is currently managed by Ms Shakti Rani
Sharma and his son Mr. Kartikeya Sharma. The company owns and
operates five hotel properties in Delhi, Chhattisgarh,
Punjab and Haryana; two under the brand name of "Hyatt Regency"
(operated by Hyatt International Corporation) and three under its
own brand; "Piccadily" (operated by PHPL). The total inventory as
on March 31, 2014 stood at 968 rooms.
PHPL reported a net loss of INR21.18 crore on the total income of
INR58.80 crore in FY13 (refers to the period April 1 to March 31)
as against a net loss of INR15.36 crore on the total income of
INR69.63 crore in FY12. Based on the unaudited financials, the
company has reported a total income of INR56.22 crore in 9MFY14.
PVSRSN ENTERPRISE: CRISIL Reaffirms 'D' Rating on INR300MM Loans
----------------------------------------------------------------
CRISIL's ratings on the bank facilities of PVSRSN Enterprise Pvt
Ltd continue to reflect its regularly overdrawn bank limits,
driven by weak liquidity, resulting from its large working capital
requirements.
Amount
Facilities (INR Mln) Ratings
---------- -------- -------
Bank Guarantee 100 CRISIL D (Reaffirmed)
Cash Credit 150 CRISIL D (Reaffirmed)
Proposed Bank Guarantee 10 CRISIL D (Reaffirmed)
Proposed Cash Credit
Limit 40 CRISIL D (Reaffirmed)
PVSRSN has working-capital-intensive operations and high
geographic concentration in its revenue profile. The company,
however, benefits from its promoter's extensive experience in the
construction sector.
PVSRSN was set up as a proprietorship firm in 2003 by Mr. P V Sita
Rama Swamy Naidu. The firm was reconstituted as a closely held
company in 2008. PVSRSN undertakes civil construction activities
entailing irrigation and roadwork, and has implemented projects in
Andhra Pradesh.
ROCKLAND HOTELS: ICRA Reaffirms 'B+' Rating on INR11.29cr Loans
---------------------------------------------------------------
ICRA has reaffirmed the long term rating of '[ICRA]B+' assigned
earlier to INR5.17 crore (reduced from INR7.69 crore) term loan
facilities and to INR6.12 crore (enhanced from INR3.60 crore)
unallocated limits of Rockland Hotels Limited. The earlier
suspension dated December 18, 2013 stands revoked.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Term Loans 5.17 [ICRA]B+ (Re-affirmed)
Unallocated Limits 6.12 [ICRA]B+ (Re-affirmed)
The rating reflects the high competition witnessed by RHL's
properties leading to their lower occupancy as well as declining
ARR. Consequently, FY13 revenues of INR4.45 crore witnessed de-
growth of 26.4%. Further, decline in scale of operations resulted
in subdued operating profits of INR0.20 crore while operating
margins contracted to 4.48%; which coupled with relatively high
interest charge resulted in losses at net level for the company.
The weakening of operational profile has had a negative impact on
the financial risk profile of the company with deterioration
witnessed in debt coverage indicators like interest coverage, DSCR
etc. In addition, given the slowdown in cash-flow generation from
the hotel and the sizeable debt repayment commitments, the
liquidity position of the company is dependent on timely infusion
of funds by the promoters. Nevertheless, ICRA has taken note of
the improvement in the operational profile of the company in first
eight months of FY14 and believe the same to support the cash
flows of the company. Also, the rating draws support from the
strategic location of the two operational budget hotel properties
of RHL which are in close proximity to the Central Business
Districts (Nehru Place, Saket) and demonstrated financial support
from the promoters.
Going forward, improvement in scale of operations and
profitability will remain amongst the key rating sensitivity
factors.
Rockland Hotels Limited, a closely held company, was incorporated
in December 2005 by three brothers namely Mr. Rajesh Kumar
Srivastava, Mr. Prabhat Kumar Srivastava and Mr. Rishi Kumar
Srivastava. In January 2007 the company took over the two
partnership firms namely Rockland Inn and Hotel Rockland.
Consequently, RHL has a portfolio of two properties -- Rockland
Inn (38 room property at C.R.Park, New Delhi) and Hotel Rockland
(20 room property at Panchsheel Enclave, New Delhi).
SACHIN FINECOT: CRISIL Raises Rating on INR89MM Loans to 'B+'
-------------------------------------------------------------
CRISIL has upgraded its rating on the long term bank facilities of
Sachin Finecot Fibers to 'CRISIL B+/Stable' from 'CRISIL
B/Stable'.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 67.1 CRISIL B+/Stable (Upgraded
from 'CRISIL B/Stable')
Term Loan 21.9 CRISIL B+/Stable (Upgraded
from 'CRISIL B/Stable')
The rating upgrade reflects the improvement in SFF's business risk
profile on account of stabilization of its capacity and
demonstrated funding support by the partners. The firm commenced
operations in December 2012 and recorded revenues of INR 206
million in 2012-13 (refers to financial year, April 1 to
March 31). The revenues are estimated to be around INR 410 million
for 2013-14. The partners have supported the business by way of
unsecured loans which stood at INR 17.6 million as on March 31,
2013. Also, the firm's liquidity profile is expected to remain
moderate over the medium term marked by sufficient cash accruals
to meet the maturing term debt repayment obligations the firm is
expected to generate net cash accruals of around INR 5 million in
2014-15 which will be sufficient to meet term debt repayments of
INR 3.7 million during the period.
The rating continue to reflect SFF's modest scale of operations
and its below-average financial risk profile marked by modest net
worth, high gearing and subdued debt protection metrics. These
rating weaknesses are partially offset by extensive experience of
SFF's partners in the cotton ginning business.
Outlook: Stable
CRISIL believes that SFF will benefit from its partners' extensive
experience in the cotton ginning business. The outlook may be
revised to 'Positive' if the firm records a significant and
sustained improvement in its scale of operations, while improving
its capital structure. Conversely, the outlook may be revised to
'Negative' if the firm reports lower than expected revenues or
margins or its working capital cycle lengthens significantly
resulting in weakening of its financial risk profile.
SFF, set up as a partnership firm in May 2012 by Mr. Navin Tayal
and Mr. Hitesh Tayal, started cotton ginning and pressing
operations in December 2012. The partners have been engaged in
the cotton ginning business for over two decades through a group
entity 'Sachin Agro Industries'. SFF's manufacturing unit is
located at Aurangabad, Maharashtra.
SFF reported a profit after tax (PAT) of INR0.67 million on net
sales of INR206 million for 2012-13, its first year of operations.
SARTHAK CREATION: CRISIL Cuts Rating on INR661.7MM Loans to 'D'
---------------------------------------------------------------
CRISIL has downgraded its ratings on the bank facilities of
Sarthak Creation Pvt Ltd to 'CRISIL D/CRISIL D' from 'CRISIL BB-
/Negative/CRISIL A4'.
Amount
Facilities (INR Mln) Ratings
---------- -------- -------
Bank Guarantee 10 CRISIL D (Downgraded from
'CRISIL A4')
Cash Credit 250 CRISIL D (Downgraded from
'CRISIL BB-/Negative')
Funded Interest
Term Loan 117.9 CRISIL D (Downgraded from
'CRISIL A4')
Letter of Credit 10 CRISIL D (Downgraded from
'CRISIL BB-/Negative')
Term Loan 273.8 CRISIL D (Downgraded from
'CRISIL BB-/Negative')
The rating downgrade reflects instances of delay by SCPL in
servicing its debt; the delays have been caused by the company's
weak liquidity. The company has been facing operational
constraints on account of limited availability of skilled labour
which led to order cancelations and piling up of raw material
inventory from February 2013. As a result, its sales declined by
around 50 per cent in 2013-14 leading to pressure on its accruals,
leading to delays in debt servicing. The interest payments are
delayed by 5 to 10 days.
SCPL also has a weak financial risk profile, marked by high
gearing and weak debt protection metrics, and small scale of
operations. However, the company benefits from its promoter's
experience in the textile industry.
SCPL was set up by Mr. Subhash Tibrewal in 2005 and commenced
commercial operations in August 2009. It manufactures shirts,
tops, and trousers, and is based in Surat (Gujarat).
SCPL reported a profit after tax (PAT) of INR1.4 million on net
sales of INR771.1 million for 2012-13 (refers to financial year,
April 1 to March 31), against a PAT of INR18.5 million on net
sales of INR657.2 million for 2011-12.
SHRI KRISHNA: ICRA Reaffirms 'B+' Rating on INR10.67cr Loans
------------------------------------------------------------
ICRA has reaffirmed '[ICRA]B+' rating assigned to the INR0.67
crores of term loans and INR10.00 crores fund based limits of Shri
Krishna Steelage (P) Ltd.. ICRA has also reaffirmed '[ICRA]A4'
rating assigned to INR4.00 Crores non-fund based limits of SKSPL.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Fund Based Limits-
Term Loan 0.67 [ICRA]B+ Reaffirmed
Fund Based Limits-
Cash Credit 10.00 [ICRA]B+ Reaffirmed
Non-fund based 4.00 [ICRA]A4 Reaffirmed
Limits-LC
The ratings of the company remain constrained by the highly
competitive nature of the steel industry, which coupled with the
low value additive nature of the business has led to low margins
for the company in the past. Moreover, the company remains exposed
to cyclicality in the steel industry given its inability to fully
pass on the effect of the price escalations in the input costs to
the customers. The ratings also factor in weak capital structure
of the company as reflected in high gearing (2.60 times as on 31st
March 2014). High reliance on external debt coupled with modest
profitability has resulted in weak debt protection metrics of the
company (Net Cash Accrual/Total Debt of 4% and Interest coverage
ratio of 1.33 times in FY14). Nevertheless, ratings derive some
comfort from the favourable demand outlook for company's products
and established presence of the promoters in the steel industry.
Shri Krishna Steelage (P) Ltd. was incorporated in the year 2004
and manufactures heavy gage S.S. cold Patti products from S.S.
flats. The company is promoted by Mr. Vinod Gautam who has an
experience of 27 years in this business. The company procures S.S.
Flat (with thickness of one inch) from local players at market
determined prices. These S.S. flats then undergo a hot rolling and
subsequent cold rolling which results in thickness reduction to
the desired level (ranging from 1mm to 5mm). The S.S. Patti finds
applications across various industries such as in door knobs,
bolts, cutlery (knife and spoon), and gas stoves and in metro rail
track.
Recent Results
The company reported Profit After Tax (PAT) of INR0.45 crores on
operating income (OI) of INR82.44 crores in FY14 provisional
results as against PAT of INR0.26 crores on OI of INR73.79 crores
in FY13 results.
SHRI LAXMAN: CARE Downgrades Rating on INR6.11cr Bank Loan to 'D'
-----------------------------------------------------------------
CARE revises the rating assigned to the bank facilities of Shri
Laxman Education Trust.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank 6.11 CARE D Revised from CARE B/
Facilities Suspension revoked
Rating Rationale
The revision in the rating assigned to the bank facilities of Shri
Laxman Education Trust primarily factors in the frequent instances
of the delay in debt servicing due to weak liquidity position.
Establishing a timely debt servicing track record with improvement
in liquidity position and better enrolment is the key rating
sensitivity.
Gwalior-based (MP) SLET was incorporated in 2009 as a trust under
the Madhya Pradesh Sarvajanik Nyas Adhiniyam Act, 1951, by Mr
Sanjay Garg and Ms Anjali Garg with the object of setting up
educational institution. At the time of incorporation, SLET had
entered into an agreement with Delhi Public School Society (DPSS).
Later on in April 2012, SLET discontinued its association with
DPSS and entered into a franchisee agreement with G D Goenka
Public School (GDGP), New Delhi. As per the agreement, SLET is
running the school in the name of GD Goenka Public School,
Gwalior, and it offers education from Nursery to X grade in
affiliation with the Central Board of Secondary Education (CBSE).
During FY14 (Provisional) (refers to the period April 1 to
March 31), SLET achieved surplus of INR0.29 crore on a Total
Operating Income (TOI) of INR2.32 crore as against surplus of
INR0.02 crore on a TOI of 2.30 crore in FY13.
SRI VAISHNAVI: CRISIL Reaffirms 'C' Rating on INR256.8MM Loans
--------------------------------------------------------------
CRISIL's ratings continue to reflect Sri Vaishnavi Spintex (India)
Pvt Ltd weak liquidity.
Amount
Facilities (INR Mln) Ratings
---------- -------- -------
Bank Guarantee 3 CRISIL A4 (Reaffirmed)
Cash Credit 70 CRISIL C (Reaffirmed)
Letter of Credit 0.2 CRISIL A4 (Reaffirmed)
Proposed Long Term
Bank Loan Facility 186.8 CRISIL C (Reaffirmed)
CRISIL had earlier downgraded its rating on the long-term bank
facilities of Sri Vaishnavi Spintex (India) Pvt Ltd to 'CRISIL C'
from 'CRISIL B/Stable', and reaffirmed its rating on the company's
short-term bank facilities at 'CRISIL A4' on April 17, 2014. The
rating downgrade reflects instances of delay by SVPL in servicing
its debt obligations (not rated by CRISIL); the delays have been
caused by the company's weak liquidity resulting from its large
working capital requirements.
The ratings also reflect the susceptibility of SVPL's
profitability margins to volatility in raw cotton prices, and the
company's exposure to regulatory changes and intense competition
in the cotton ginning industry. These rating weaknesses are
partially offset by the benefits that SVPL derives from its
promoters' extensive entrepreneurial experience.
About the Company
SVPL was established in 2010 by Mr. Vanapalli Leela Prasad. The
company is engaged in cotton yarn spinning. The company commenced
operations in 2012, and its spinning unit in based in Kolanapalli
village, Andhra Pradesh.
SUZLON ENERGY: Discloses Cashless Restructuring of $485MM Bonds
---------------------------------------------------------------
livemint.com reports that Suzlon Energy Ltd announced on May 2 a
cash-less restructuring of its existing foreign currency
convertible bonds (FCCBs) worth $485 million for five years, after
nearly two years of complex negotiations with bondholders.
The Pune-based company has four different series of FCCBs issued
to investors, the report says.
Suzlon had failed to repay $209 million of debt on 11 October 2012
after bondholders rejected its request for a four-month extension.
The default was the biggest on convertible bonds by an Indian
firm, according to livemint.com.
livemint.com relates that as a part of the restructuring, Suzlon
Energy will issue approximately $485 million and the new
restructured bonds will have a maturity period of five years and
one day from the date of issue.
These bonds will mature in 2019-20 fiscal year, the company said.
The conversion price is set at Rs.15.46 a share, being 10% over
the regulatory floor price, the report notes.
According to the report, Suzlon Energy has four series of FCCBs of
$200 million that was due in October 2012, FCCBs of $20.8 million
due in October 2012, FCCBs of $90 million due in July 2014 and
FCCBs of $175 million due April 2016.
The company did not disclose details of interest offered and
break-ups between the bonds, the report adds.
livemint.com reports that Suzlon Energy said the company and an
ad-hoc committee of the bondholders concluded negotiations and
agreed on the proposed restructuring terms. The ad-hoc committee
of bondholders comprises of select bondholders with significant
holdings across each of the existing bonds, the report relays.
The restructuring proposal, including the terms of the new
restructured bonds, are subject to the approval of the Reserve
Bank of India, the CDR (corporate debt restructuring) empowered
group (of banks) and the requisite majority of the holders of the
existing bonds in each series, livemint.com notes.
"In this regard, the company will issue separate notices, each
dated on or about 6 May 2014, to convene meetings of the holders
of each series of the existing bonds to consider, and if thought
fit, to approve, the restructuring proposal," Suzlon said in a
statement cited by livemint.com.
Further, Suzlon Energy has entered into, a so-called standstill
agreement with the bondholder's ad-hoc committee to facilitate the
proposed restructuring of the existing bonds. This agreement
provides for a standstill period extending until August 15, 2014,
livemint.com. relays.
"The standstill agreement is a testimony of the faith and
confidence the bond holders have displayed in Suzlon. At Suzlon, I
take pride to share that against the backdrop of a challenging
business environment, the company has managed to retain its prized
customers," livemint.com quotes Tulsi Tanti, chairman at Suzlon
Energy, as saying.
livemint.com relates that Kirti Vagadia, group head (corporate
finance) at Suzlon Group said the proposed cashless restructuring
package for the existing bonds is an optimal solution to the last
remaining piece under the comprehensive liability management
programme and is value accretive for all stakeholders.
Suzlon Energy, which is going through a INR9,500 crore corporate
debt restructuring exercise, reported a loss of INR1,075.25 crore
for the quarter ended December 31, compared with a loss of
INR1,154.53 crore in the year-ago period, livemint.com discloses.
In January 2013, Suzlon's lenders, a consortium of 19 banks,
agreed to enhance working capital facilities to the group by
INR1,800 crore and announced a 10-year deferred repayment plan.
According to Mint research, as on September 30, 2013, the latest
data available, the consolidated debt of Suzlon Group stood at
INR14,971.29 crore.
About Suzlon Energy
Headquartered in Pune, India, Suzlon Energy Ltd (BOM:532667) --
http://www.suzlon.com/-- is engaged in the business of design,
development, manufacturing and supply of wind turbine generators
(WTGs) of a range of capacities and its components. Its
operations relate sale of WTGs and allied activities, including
sale/sub-lease of land, infrastructure development income; sale
of gear boxes, and sale of foundry and forging components.
Others primarily include power generation operations.
U G CONSTRUCTIONS: CRISIL Rates INR70MM Cash Credit at 'B'
----------------------------------------------------------
CRISIL has assigned its 'CRISIL B/Stable' rating to the bank
facilities of U G Constructions Ltd.
Amount
Facilities (INR Mln) Ratings
---------- -------- -------
Cash Credit 70 CRISIL B/Stable
The rating reflects UG's exposure to risks related to
completion and saleability of its on-going projects, and the
geographic concentration in its revenue profile. These rating
weaknesses are partially offset by the experience of UG's
promoters in the construction business.
Outlook: Stable
CRISIL believes that UG will benefit over the medium term from its
promoters' experience in construction industry. The outlook may be
revised to 'Positive' if the company completes its projects
earlier than expected or witnesses more-than-expected sales
realisations from ongoing projects, leading to larger-than-
expected cash flows. Conversely, the outlook may be revised to
'Negative' in case of delays in project execution or in receipt of
advances from customers, or large debt-funded project, weakening
the company's financial risk profile.
UG, set up in 2010, is engaged in residential real estate
development and civil construction.
The company is based in Chennai (Tamil Nadu); its day-to-day
operations are managed by Mr. P Ramesh and Mr. P.S. Ganesan.
UG reported a net profit of INR3.6 million on revenue of INR77.5
million in 2012-13 (refers to financial year, April 1 to
March 31).
UNIVERSAL CONSTRUCTION: CARE Cuts Rating on INR43.97cr Loan to B+
-----------------------------------------------------------------
CARE revises/reaffirms rating assigned to the bank facilities of
Universal Construction Machinery & Equipments Limited.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank 43.97 CARE B+ Revised
Facilities from CARE BB
Short-term Bank
Facilities 13.00 CARE A4 Reaffirmed
Rating Rationale
The revision in the rating assigned to the long-term bank
facilities of Universal Construction Machinery & Equipments
Limited factors in the deterioration in the liquidity position,
decline in the revenue and profitability, net losses incurred
during FY13 (refers to the period April 1 to March 31) and
deterioration in interest & debt coverage indicators.
The ratings continue to be constrained by the working capital
intensive operations, high contingent liabilities in the form of
corporate guarantee extended to a group company and in the form of
Income tax demand notices and dependence on the cyclical real
estate and construction industries.
The ratings, however, continue to take into consideration the
promoter's significant experience, established presence in the
construction equipment industry and arrangement with TATA
International Ltd (TIL) for marketing & distribution of its
products in the export market.
The ability of the company to scale up operations along with an
improvement in the capital structure, liquidity position and
profitability levels withstanding volatile raw material prices
remains the key rating sensitivities.
Universal Construction Machinery & Equipments Limited was founded
by Mr Rohidas More in the year 1975. UCMEL manufactures a wide
range of construction equipments and has manufacturing units near
Pune and Rudrapur (Uttaranchal). The range of products
manufactured by the company includes concrete mixer, batching
plant, transit mixer, hanging platform, passenger/material lift
for construction site, power bar bending & cutting machine, etc.
Mr Rohidas More along with his two sons Mr Ranjeet Moray & Mr
Abhijit More look after the operations of the company.
For FY13, UCMEL achieved a total operating income of INR133.6
crore with a PBILDT & net loss of INR4 crore and INR4.5 crore
respectively compared to the total operating income of INR163.2
crore and PBILDT & PAT of INR13.6 crore and INR2.7 crore in FY12.
VISHAL COATERS: CRISIL Reaffirms 'B+' Rating on INR120MM Loans
--------------------------------------------------------------
CRISIL rating continue to reflect Vishal Coaters Limited's (VCL a
part of Vishal group) constrained liquidity and small scale of
operations in the highly fragmented writing and printing paper
(WPP) industry. These rating weaknesses are partially offset by
the group's moderate financial risk profile, marked by low
gearing, and its promoters' extensive industry experience.
Amount
Facilities (INR Mln) Ratings
---------- -------- -------
Cash Credit 25 CRISIL B+/Stable (Reaffirmed)
Proposed Long Term
Bank Loan Facility 75 CRISIL B+/Stable (Reaffirmed)
Term Loan 20 CRISIL B+/Stable (Reaffirmed)
CRISIL had upgraded its rating on the long-term bank facilities of
Vishal Coaters Ltd (VCL; part of the Vishal group) to 'CRISIL
B+/Stable' from 'CRISIL B/Stable' on 29 April 2014.
For arriving at the rating, CRISIL has now combined the business
and financial risk profiles of VCL and Vishal Paper Industries Pvt
Ltd (VPI). This is because the two companies, together referred to
as the Vishal group, are engaged in the same business, have common
promoters, and there are significant operational linkages between
them.
Outlook: Stable
CRISIL believes that the Vishal group will continue to benefit
over the medium term from its promoters' extensive industry
experience and its established relationships with customers. The
outlook may be revised to 'Positive' if the group improves its
liquidity and reports more-than-expected operating income and cash
accruals. Conversely, the outlook may be revised to 'Negative' if
there is further deterioration in the Vishal group's liquidity, or
if it undertakes a large debt-funded capital expenditure
programme.
VCL and VPI manufacture WPP. They were established in 1999 and
2004, respectively, by Mr. Vidya Sagar and Mr. Krishan Mohan. VPI
was initially set up as a partnership firm but was later
reconstituted as a private limited company in 2011. The companies
are based in Patiala (Punjab). VCL and VPI have manufacturing
capacities of around 30,000 tonnes per annum (tpa) and 36,000 tpa,
respectively.
The Vishal group reported a profit after tax (PAT) of INR17.1
million on net sales of INR1.0 billion for 2012-13 (refers to
financial year, April 1 to March 31), against a PAT of INR17.7
million on net sales of INR952.3 million for 2011-12.
=========
J A P A N
=========
TOKYO ELECTRIC: Posts JPY438.65 Billion Annual Net Profit
---------------------------------------------------------
Japan Today reports that Tokyo Electric Power Co (TEPCO) said it
booked a JPY438.65 billion annual net profit owing to an
electricity rate hike and a massive government bailout following
the 2011 disaster.
TEPCO was teetering on the brink as cleanup and compensation costs
stoked huge losses and threatened to collapse the sprawling
utility until Tokyo stepped in with a rescue package, the report
notes.
According to the report, the company at the center of the worst
nuclear accident in a generation said it earned JPY438.65 billion
in the fiscal year to March, compared with a net loss of
JPY685.3 billion in the same period a year earlier.
Sales rose 11% to JPY6.63 trillion, it said.
TEPCO said the company's results got a boost from a rate hike, and
helped offset a decline in the amount of electricity TEPCO sold
owing to warmer-than-usual winter weather, Japan Today relays.
It also booked a special gain of JPY1.8 trillion based on funds
the company received from a government-backed bailout fund as well
as asset sales, the report adds.
But it added that rising fossil fuel costs after Japan switched
off its nuclear reactors were pressuring its bottom line, relates
Japan Today.
"The business environment that surrounds us remains very serious,"
TEPCO President Naomi Hirose told a news conference, Japan Today
reports.
About Tokyo Electric
Tokyo Electric Power Company is the largest electric power
company in Japan and the largest privately owned electric
utility in the world. TEPCO supplies electricity to meet the
increasingly diversified and sophisticated demands of its over
28.09 million customers in the metropolitan Tokyo, which is the
political, economic, and cultural center of Japan, and eight
surrounding prefectures.
Bloomberg News said the utility is battling radiation leaks at
the Fukushima Dai-Ichi power plant north of Tokyo after a
March 11 earthquake and tsunami knocked out its cooling systems,
causing the biggest atomic accident in 25 years. More than
50,000 households were forced to evacuate and Bank of America
Corp.'s Merrill Lynch estimates TEPCO may face compensation
claims of as much as JPY11 trillion (US$135 billion).
As reported in the Troubled Company Reporter-Asia Pacific on
May 11, 2012, Bloomberg News said Japan's government took control
of Tepco and agreed to provide JPY1 trillion (US$12.5 billion) as
part of the nation's largest bailout since the rescue of the
banking industry in the 1990s.
Bloomberg related that the government will obtain more than 50%
of the voting rights in the utility under a 10-year plan approved
on May 8 by Trade and Industry Minister Yukio Edano. The
government stake may rise to two-thirds if TEPCO fails to meet
goals that include cost cuts and compensation payments, said
Bloomberg.
Under the plan, Bloomberg disclosed, the utility aims for an
unconsolidated profit of JPY106.7 billion in the year ending
March 2014, based on an electricity rate increase and the restart
of the Kashiwazaki Kariwa nuclear station. Bloomberg says
nationalization of TEPCO paves the way for the government to
restructure the electricity industry monopolized by regional
utilities and possibly break up power generation and transmission
networks to allow more competition.
====================
N E W Z E A L A N D
====================
LOMBARD FINANCE: Ex-Directors Win Appeal vs. Custodial Sentences
----------------------------------------------------------------
BusinessDesk reports that the former directors of Lombard Finance
have won their appeal against custodial sentences after the
Supreme Court agreed they were "honest men" who made misjudgements
under pressure.
"The Supreme Court has concluded that the appellants' conduct did
not warrant sentences of imprisonment and has unanimously allowed
the appeal," Chief Justice Sian Elias, and Justices Terence
Arnold, William Young, Susan Glazebrook and Peter Blanchard said
in their decision, BusinessDesk relates.
BusinessDesk notes that former Justice Ministers Doug Graham and
Bill Jeffries, former PR man for the Queen Lawrie Bryant and
Lombard's ex-boss Michael Reeves had appealed to the Supreme Court
over sentences of home detention imposed by the Court of Appeal.
They weren't granted leave to appeal the actual convictions.
"On the findings of fact made by (Justice Robert Dobson) the
appellants were honest men who took their responsibilities
seriously but nonetheless, by reason of misjudgements made in
circumstances of pressure, were responsible for the issuing of a
prospectus which was untrue as to liquidity," the Supreme Court
judges, as cited by BusinessDesk, said. "These findings of fact
were not disturbed by the Court of Appeal. On this basis, the
sentencing purposes of accountability, enunciation and deterrence
had limited application."
They said the "considerable losses" suffered by investors were
less than those in some other comparable cases, BusinessDesk
relays.
All four Lombard directors avoided jail time when originally
sentenced in 2012 after being found guilty of making untrue
statements in investment documents and advertisements in late 2007
and early 2008, says BusinessDesk. But the Crown succeeded in
getting the Court of Appeal to beef up the punishment to custodial
sentences by adding home detention, BusinessDesk notes.
BusinessDesk recalls that the High Court in 2012 had sentenced
Jeffries and Reeves to 400 hours community work. Graham and Bryant
were each originally 300 hours community work and agreed to pay
NZ$100,000 each to investors.
The 4,400 Lombard Finance investors owed $127 million at the time
of the receivership have been repaid 13 cents in the dollar, and
are looking at an estimated recovery of between 15 percent and 20
percent, BusinessDesk adds.
About Lombard Finance
Lombard Finance & Investments Limited was a wholly owned
subsidiary of Lombard Group, a diversified company specializing
in the financial services sector offering a number of lending
options and providing investment opportunities for its
shareholders and investors.
Lombard Finance was placed into receivership on April 10, 2008,
by its trustee, Perpetual Trust Limited. PricewaterhouseCoopers
partners John Fisk and John Waller have been appointed receivers
of the company. The receivership also applies to three other
subsidiaries of Lombard Group, being Lombard Asset Finance
Limited, Lombard Property Holdings Limited and Lombard Asset
Finance No 2 Limited. The receivership does not impact
Lombard Group Limited.
Some 4,400 Lombard Finance investors were owed NZ$127 million.
ROSS ASSET: David Ross Granted Time Out of Prison
-------------------------------------------------
Hamish McNicol and Dave Burgess at Fairfax New Zealand News
reports that fraudster David Ross has already been out of prison
twice, both before and after he was sentenced to 10 years and 10
months jail for running a fraudulent scheme in which investors
lost about NZ$115 million.
Corrections confirmed on May 5 that Mr. Ross had been "on
occasion" granted "temporary removals" from prison, the report
says.
Fairfax NZ relates that a spokesman for Corrections Minister Anne
Tolley said her office had been made aware that Mr. Ross had twice
been taken out of prison to have medical issues dealt with, and
was accompanied by officers at all times.
"Legally, Corrections has a duty of care to all prisoners, which
they take very seriously," the report quotes Ms. Tolley as saying.
It said it had no further information as to the dates of his
removal, or for how long, the report relates.
According to the report, lower North Island regional commissioner
Paul Tomlinson said Corrections had double-checked and confirmed
Ross was accompanied twice by corrections officers when he visited
medical professionals.
"This occurred on November 8 and December 4 last year . . . he has
not, however, been to a beach during these occasions," the report
quotes Mr. Tomlinson as saying.
Mr. Ross was remanded in custody in August last year when he
pleaded guilty to five charges stemming from the NZ$115 million
fraud. He was later sentenced November 15 last year.
The Dominion Post was told that Mr. Ross was recently seen
unloading furniture from a truck into a friend's property at
Riversdale Beach, near Masterton, the report relays.
But Corrections last week rejected the claims Mr. Ross had been
released to go to a beach, Fairfax NZ adds.
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).
SOUTH CANTERBURY FINANCE: Witness Swamped by Hyatt Loan Data
------------------------------------------------------------
Emma Bailey at Fairfax NZ News reports that just six weeks before
the South Canterbury Finance (SCF) trial, an expert witness was
given 10,000 documents to consider.
Former SCF chief executive Lachie McLeod and former directors
Edward Sullivan and Robert White are on trial before Justice Paul
Heath in the High Court at Timaru on 18 charges laid by the
Serious Fraud Office (SFO), the report says.
On May 5 the expert witness, forensic accountant Bradley Porter,
was cross-examined by Marc Corlett, who represents Mr. Sullivan,
according to the report.
Mr. Porter was seconded by the SFO for the SCF case in May 2011.
Six weeks before the trial started, on March 12, he was sent the
extra documents to review in relation to two key transactions
referred to in the trial -- the lending to the Hyatt Hotel and to
Shark Wholesalers. The Crown contends both were related party
loans.
In his cross-examination on May 5, the report relates,
Mr. Corlett quizzed Mr. Porter about his previous experience. He
had finished his study in 2008 and began fulltime employment as an
accountant in 2009. He was seconded to the SFO with two years'
experience.
Fairfax NZ says Mr. Corlett wanted to know how much direction
Mr. Porter had given on charges being laid, following his
investigation into the transactions. He said he just provided the
information.
He was asked why he had made amendments to his brief of evidence.
"The SFO provided extra information for me to consider," the
report quotes Mr. Porter as saying.
According to the report, the Hyatt Hotel transaction, a loan of
NZ$25 million, is crucial to the entry of SCF into the Crown
deposit guarantee scheme. If the transaction is found to be to a
related party, it should have been declared in the application for
entry to the Crown scheme, the report notes.
Fairfax NZ notes that the defendants' involvement in preparation
of the application will determine their culpability. All three
defendants have been charged with obtaining by deception in
relation to SCF's application and subsequent entry into the
guarantee scheme.
The Hyatt loan has also given rise to a charge of theft by a
person in a special relationship as it allegedly breached the
Crown guarantee terms, which stated that SCF could not enter into
any agreement that exceeded 1 per cent of SCF assets without prior
consent, and had to be carried out at "arm's length".
In relation to the loan of $5.2m to Shark Wholesalers, Sullivan
and White face a charge of making a false statement by a promoter
for not disclosing the lending in a SCF prospectus.
Based in New Zealand, South Canterbury Finance Limited
(NZE:SCFHA) -- http://www.scf.co.nz/-- was engaged in the
provision of financial services. The Company's principal
activities were borrowing funds from public and institutional
investors and on lending those funds to the business, plant and
equipment, property, rural and consumer sectors. It typically
advanced funds by means of hire purchase, floor plans, leasing of
plant, vehicles and equipment, personal loans, business term
loans and revolving credit facilities, mortgages against
property, and other financial instruments, including consumer
loan insurance.
On Aug. 31, 2010, Trustees Executors Limited, as trustee for
South Canterbury Finance charging group, appointed Kerryn Downey
and William Black of McGrathNicol as receivers of the charging
group's secured assets.
"As Trustee, we have had South Canterbury Finance under
heightened surveillance since 2008. As part of that, SCF was
granted a Trustee waiver in February 2010 to allow it time to
recapitalize. Unfortunately, the Company's Directors have
advised us that they have not been successful with respect to a
recapitalization and requested us to appoint a receiver. At this
point we, as Trustee, agree that it is the best interests of
debenture, deposit and bond holders to do that," said Yogesh
Mody, Southern Regional Manager for Trustees Executors Limited.
The New Zealand government repaid South Canterbury's 35,000
depositors and stockholders NZ$1.6 billion under the Crown
retail deposit guarantee scheme.
================
P A K I S T A N
===============
PAKISTAN: Moody's Caa1 Gov't Bond Rating Reflects Financing Needs
-----------------------------------------------------------------
Moody's Investors Service says that Pakistan's Caa1 government
bond rating with a negative outlook reflects the country's very
low institutional and fiscal strength, its weakened external
position and large government financing needs.
Moody's views were outlined in its just-released Credit Analysis
on the Government of Pakistan.
The report elaborates on Pakistan's credit profile in terms of
Economic Strength, Institutional Strength, Fiscal Strength and
Susceptibility to Event Risk, which are the four main analytic
factors in Moody's Sovereign Bond Rating Methodology.
Moody's notes that in recent months, Pakistan has made progress
under the Extended Fund Facility (EFF) agreement which it signed
with the International Monetary Fund (IMF) in July 2013. Under the
agreement, Pakistan envisages implementing reforms in the energy
sector, improving tax administration, and privatizing some of its
public enterprises. A successful completion of the challenging
program of reform would address constraints on economic growth and
reduce fiscal imbalances, thus improving the sovereign's credit
profile.
IMF program disbursements, coupled with a recent sovereign bond
issuance and the receipt of grants have also helped to reverse the
decline in official foreign-exchange reserves, bolstering thinned
external buffers and reducing to some degree vulnerability to a
sudden stop in capital inflows.
In the near term, large fiscal imbalances and debt structure
weaknesses, coupled with a narrow tax base and heavy reliance on
the banking system for deficit financing will likely remain credit
constraints.
Apart from the successful implementation of structural policy
reforms, other key triggers for an upward revision in the rating
include improvements in domestic and regional political stability
and a sustained build-up in external liquidity.
A combination of factors would prompt a further downgrade. These
factors include a substantial worsening of the domestic political
environment and significant further deterioration in the policy
framework and investor confidence. A relapse in which official
foreign-exchange reserves decline again would be credit negative
as it would materially increase the probability of default.
*********
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
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TCR-AP subscription rate is US$775 for 6 months delivered via e-
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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 ***