/raid1/www/Hosts/bankrupt/TCRAP_Public/150305.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, March 5, 2015, Vol. 18, No. 045
Headlines
A U S T R A L I A
CERAMIC FUEL: First Creditors' Meeting Slated For March 13
CHARTERHILL GROUP: Creditors Set to Suffer in AUD19.MM Collapse
HERITAGE GOLF CLUB: Facing Member Revolt Over Mismanagement
MAXWELL TRANSPORT: First Creditors' Meeting Set For March 13
MAXWELL TRANSPORT: Stumbles, Recovery Looks Like a Hard Task
NORMANVILLE MEATWORKS: First Creditors' Meeting Set For March 13
PEABODY ENERGY: Moody's Rates New $1BB Sr. Unsec. Notes at 'B2'
RB HOSPITALITY: Goes Into Liquidation but Doors Remain Open
REALESTATE NOW: First Creditors' Meeting Set For March 11
RIDGWAY CAPITAL: First Creditors' Meeting Set For March 16
* Australian Auto Losses Continue to Fall in 4Q14, Fitch Says
C H I N A
AOXING PHARMACEUTICAL: Posts $602K Net Profit in Dec. 31 Quarter
CHINA BAK: Posts $17.4M Profit in Dec. 31 Quarter
CHINA GERUI: Receives Nasdaq Listing Non-Compliance Notice
MAOYE INTERNATIONAL: S&P Lowers CCR to 'BB'; Outlook Negative
TIMES PROPERTY: Moody's Rates New USD Sr. Unsec. Notes at 'B2'
I N D I A
A.V. VALVES: CARE Reaffirms B/A4 Rating on INR4.8cr LT/ST Loan
ANABELL PAPER: CRISIL Suspends D Rating on INR50MM Cash Credit
ARIHANT SPINTEX: CRISIL Assigns B+ Rating to INR160.6MM Term Loan
ASIA MATCH: CRISIL Suspends B+ Rating on INR70MM Cash Credit
ATMIYA ENGINEERING: CRISIL Assigns C Rating to INR51.7MM Loan
BALAJI POLYSACKS: CRISIL Rates INR100MM Cash Loan at B-
BHARAT CATTLEFEED: CRISIL Reaffirms B+ Rating on INR40MM Loan
BHAWANI STEELS: CRISIL Assigns B- Rating to INR65MM Cash Credit
CRIMSON METAL: CARE Reaffirms B Rating on INR11.65cr LT Loan
DC INDUSTRIAL: CARE Reaffirms D Rating on INR188cr ST Loan
DEVANS MODERN: CRISIL Assigns 'D' Rating to INR507MM Term Loan
DHARANI TEXTILES: CRISIL Cuts Rating on INR224.7MM Loan to D
DUKE SPONGE: CARE Revises Rating on INR25cr LT Loan to B+
DURGASHAKTI FOODS: CRISIL Ups Rating on INR80MM Loan to 'B'
FLEXICAN BELLOWS: CRISIL Assigns B+ Rating to INR40MM Cash Loan
H K LUMBERS: CRISIL Assigns B Rating to INR15MM Cash Credit
HULE CONSTRUCTIONS: CARE Reaffirms B+ Rating on INR9cr LT Loan
KALYANESWARI UDYOG: CRISIL Suspends B Rating on INR56MM Loan
LAKSHMI NARAYANA: CRISIL Suspends B Rating on INR80MM Cash Credit
M.G. AUTO: CRISIL Assigns B+ Rating to INR60MM Secured Loan
NAG LEATHERS: CARE Reaffirms D Rating on INR6cr LT Bank Loan
NAG YANG: CARE Reaffirms D Rating on INR12cr LT Bank Loan
NATURAL SELECTIONS: CRISIL Assigns B+ Rating to INR23.5MM Loan
PARASRAM MANNULAL: CARE Revises Rating on INR5cr Loan to B+
PRASAD SEEDS: CRISIL Assigns B+ Rating to INR45MM Cash Credit
PRASANTHI CASHEW: CRISIL Reaffirms B- Rating on INR300MM Loan
PSM ENERGY: CRISIL Assigns B+ Rating to INR10MM LT Bank Loan
R.V.M EDUCATION: CRISIL Suspends D Rating on INR200MM Term Loan
RAGHAW FASHIONS: CRISIL Assigns B+ Rating to INR30MM Cash Credit
S. R. COTTON: CRISIL Reaffirms B+ Rating on INR75MM Cash Loan
SARASWATI EDUCATION: CRISIL Cuts Rating on INR960MM Loan to D
SHRI RENUGA: CARE Lowers Rating on INR252.65cr LT Loan to D
SKS FASTENERS: CRISIL Suspends B+ Rating on INR95MM Cash Credit
SPRL FOODS: CARE Reaffirms B+ Rating on INR31.12cr LT Loan
SVS HOSPITALS: CRISIL Assigns B Rating to INR72MM LT Loan
T. ASOKAN: CRISIL Assigns B+ Rating to INR50MM Cash Credit
TRIVENI SHIP: CRISIL Cuts Rating on INR50MM Cash Loan to B+
VICTORA AUTO: CRISIL Suspends B Rating on INR40MM LT Bank Loan
ZENOVA BIO: CRISIL Reaffirms D Rating on INR66MM Long Term Loan
I N D O N E S I A
LIPPO KARAWACI: S&P Affirms 'BB-' CCR; Outlook Stable
J A P A N
SHARP CORP: May Post JPY200BB Loss for FY2014, Close Plants
SHARP CORP: S&P Lowers CCR to CCC+ & Remains on CreditWatch Neg.
M O N G O L I A
STATE BANK: Moody's Rates Global LC Long-term Deposit at 'B2'
N E W Z E A L A N D
CONCEPT HOMES: In Administration, Owes More Than NZ$1MM
EHOME NZ: To Finish Building Houses While in Receivership
- - - - -
=================
A U S T R A L I A
=================
CERAMIC FUEL: First Creditors' Meeting Slated For March 13
----------------------------------------------------------
Adam Nikitins and Justin Walsh of Ernst & Young Australia were
appointed as administrators of Ceramic Fuel Cells Limited on March
1, 2015.
A first meeting of the creditors of the Company will be held at
170 Browns Road, in Noble Park, Victoria, on March 13, 2015, at
9:00 a.m.
CHARTERHILL GROUP: Creditors Set to Suffer in AUD19.MM Collapse
---------------------------------------------------------------
Nick Bendel at The Advertiser reports that the latest reports into
the collapse of a highly diversified real estate and financial
services group shows creditors will see almost no return.
Four related entities of the Charterhill Group owed
AUD19.1 million dollars when they entered insolvency in January-
February 2014, The Advertiser relates citing documents recently
filed with ASIC.
The Adelaide-based group offered a range of services including
real estate marketing, property management, mortgage broking,
contract negotiation and SMSF advice.
One of the four companies, Nova Real Estate, owed AUD7.6 million,
according to a report filed by the liquidator, Andrew Heard of
Heard Phillips, The Advertiser relates.
According to The Advertiser, Mr. Heard's presentation of accounts
and statements, which covers the period between Feb. 25, 2014, and
Feb. 24, 2015, shows he recouped only AUD49,500 during that time.
The Advertiser relates that Mr. Heard is also acting as liquidator
for one of the other related entities, broking business Lending
Solutions International.
The latest numbers show that creditors are owed AUD10.2 million
but that only AUD31 has been recovered, the report discloses.
Michael Basedow of Pitcher Partners is acting as receiver and
manager of the final two entities: EJ Property Developments and
Financial Wellness, the report notes.
Those two companies owe a combined AUD1.3 million but have only
collected AUD39,000 in payments, according to Mr Basedow's
presentation of accounts and statements obtained by The
Advertiser.
In total, only AUD89,000 of the AUD19.1 million in debts has been
recovered, or less than 0.5 cents in the dollar, the report notes.
Charterhill director George Nowak was ordered to surrender his
passport in February 2014 and filed a petition for bankruptcy in
July 2014, The Advertiser recalls.
The report relates that soon after the group's collapse, Mr Nowak
sent an email to clients in which he blamed Charterhill's
diversification strategy for its demise.
"As you are aware, Charterhill Group and its associated entities
have provided a 'one-stop shop' for our clients which is unique in
Australia in this industry but, unfortunately, it has come at a
cost," he said in the email, the report adds.
As reported in Troubled Company Reporter-Asia Pacific on
Feb. 7, 2014, following an application by the Australian
Securities and Investment Commission, the Federal Court in
Adelaide on Feb. 5, 2014, froze all assets owned or otherwise held
by the founder of the Charterhill group of companies,
George Nowak, and his wife, Betty Nowak.
The court also ordered the surrender of Mr. and Mrs. Nowak's
passports and restrained their travel out of Australia, as ASIC
investigates the collapse of the Charterhill group, which
specialises in assisting clients to invest in property through
self-managed superannuation funds (SMSFs).
ASIC's application was brought under section 1323 of the
Corporations Act 2001 and followed steps taken by ASIC to secure
Mr. Nowak's passport by agreement and to obtain an undertaking
from him that he would not dispose of or otherwise deal with any
assets.
The following companies in the Charterhill Group have been placed
under external control:
* Lending Solutions International Pty Ltd -- liquidators
appointed (Andrew Heard and Anthony Phillips of Heard
Phillips)
* Nova Real Estate Pty Ltd -- external administrators
appointed (Andrew Heard and Anthony Phillips of Heard
Phillips)
* EJ Property Developments Pty Ltd -- receivers and managers
appointed (Michael Basedow and Leigh Prior of Pitcher
Partners)
* Financial Wellness Pty Ltd -- receivers and managers
appointed (Michael Basedow and Leigh Prior of Pitcher
Partners).
HERITAGE GOLF CLUB: Facing Member Revolt Over Mismanagement
-----------------------------------------------------------
Chris Vedelago and Cameron Houston at The Sunday Age reports that
a grassroots revolt is brewing at one of Victoria's most exclusive
golf clubs amid allegations of mismanagement and bitter fighting
between members and staff and its new owner.
The report says the Heritage Golf and Country Club, in Melbourne's
north-east, is owned by Xiaoyan (Kylie) Bao, who took control of
the club last year as part of a separation arrangement with her
husband, Chinese billionaire-turned-Australian investor Wang Hua.
According to the Sunday Age, members are reportedly upset over a
decline in service, cleanliness and management standards at the
sprawling AUD20 million resort-style complex in Chirnside Park
since the changeover.
The report relates that in one widely discussed incident, an
unsupervised 8-year-old drove off in a golf cart and crashed it
into one of the buildings. He also sprayed a member with suntan
lotion, the report says.
A representative of Heritage's management said the club had been
experiencing "teething" problems that were now largely resolved,
although members and creditors are still preparing to take action,
the Sunday Age reports.
The Sunday Age states that the club is facing court proceedings
that could see it declared insolvent over failure to pay a
AUD9,300 maintenance bill, one in a series of mounting disputes
with suppliers and tradies that is allegedly threatening the
club's ability to operate.
Members, who pay AUD3,852 a year to use premium facilities that
include Jack Nicklaus and Tony Cashmore-designed golf courses, a
conference centre, lounge, pool and a day spa, allege the facility
is being "run into the ground," the report discloses.
"It's supposed to be one of the top private clubs in the state but
even basic services have been in disarray," the report quotes a
member as saying. "We've had enough."
Others have expressed concern that membership fees collected by
the club were not being spent on the business, the report adds.
Documents obtained by The Sunday Age show members have been
complaining club toilets are not being cleaned, the driving range
was closed due to lack of petrol for the ball machines, no clean
towels were in the locker room, and air conditioning in the lounge
and heating for the pool had been shut off for a time.
There are reports a number of staff have been fired and others
have walked out over pay disputes, the report relates. One
Heritage golf pro is now taking cash upfront from clients after
the club stopped paying him for giving lessons, according to the
report.
The Sunday Age notes that the mounting problems have led the
club's membership committee to call a special meeting on Feb. 24
amid a growing move by members to quit the club in protest at the
conditions.
The Sunday Age says some members are planning to move a motion of
"no confidence" in the club's management.
Heritage has been declared insolvent on two previous occasions
before it was bought by Wang Hua last year, the report notes.
As reported in the Troubled Company Reporter-Asia Pacific on
Feb. 7, 2014, Hamish Alan Mackinnon and Michael Francis Quin of
Bent & Cougle were appointed as administrators of GHG Services Pty
Ltd, trading as Heritage Golf and Country Club, on Jan. 31, 2014.
MAXWELL TRANSPORT: First Creditors' Meeting Set For March 13
------------------------------------------------------------
Gess Michael Rambaldi & Andrew Reginald Yeo of Pitcher Partner
were appointed as administrators of Maxwell Transport Group Pty
Ltd and MTG Logistics Pty Ltd on March 2, 2015.
A first meeting of the creditors of the Company will be held at
Pitcher Partner, Level 19, 15 William Street, in Melbourne, on
March 13, 2015, at 3:00 p.m.
MAXWELL TRANSPORT: Stumbles, Recovery Looks Like a Hard Task
------------------------------------------------------------
ATN News reports that Melbourne-based linehaul and refrigerated
transport operator Maxwell Transport has moved into voluntary
administration.
Two key businesses from the group are now under the responsibility
of appointed administrators, according to ATN News.
Gess Rambaldi -- gess.rambaldi@pitcher.com.au -- and Andrew Yao
-- andrew.yao@pitcher.com.au -- of Pitcher Partners, have taken
control of the transport operations through the Maxwell Transport
and MTG Group entities.
A third company, Optimal Corporate Services, is in liquidation,
under the watch of Romanis Cant managing partner Tony Cant, the
report relates.
Romanis Cant told ATN some parts of the business were shut down
immediately on his appointment on March 2, the report discloses.
Chances of a return to business-as-usual for Maxwell Transport are
therefore "remote", but he remains hopeful other parts of the
business can be saved, the report relays.
It is understood the majority of the 60 staff were employed
through Optimal Corporate Services.
Romanis Cant met with employees to advise them of the situation,
and to explain how entitlements could be claimed, the report
relays.
Mr. Cant said some staff will be required by the businesses as
they work through administration, but they are likely to be
rehired through either those or a third entity, the report says.
Maxwell Transport Group was established in 2000 and claimed
Woolworths as a foundation customer. As well as transport, the
company offers warehousing and third-party logistics services, as
well as industry property development.
NORMANVILLE MEATWORKS: First Creditors' Meeting Set For March 13
----------------------------------------------------------------
Andre Strazdins and Alan Scott of BRI Ferrier were appointed as
administrators of Normanville Meatworks Pty Ltd on March 2, 2015.
A first meeting of the creditors of the Company will be held at
BRI Ferrier, Level 4, 12 Pirie Street, in Adelaide, on March 13,
2015, at 11:00 a.m.
PEABODY ENERGY: Moody's Rates New $1BB Sr. Unsec. Notes at 'B2'
---------------------------------------------------------------
Moody's Investors Service assigned a B2 rating to the new $1
billion senior secured second lien notes due in 2022, proposed by
Peabody Energy Corporation. At the same time, Moody's affirmed
all existing ratings, including its Corporate Family Rating of B2,
probability of default rating of B2-PD, senior secured first lien
credit facility rating of Ba3, senior unsecured rating of B3, and
the rating on junior subordinated debentures of Caa1. The
company's Speculative Grade Liquidity rating is affirmed at SGL-2.
The ratings outlook is negative.
The new notes will be secured by a second-priority lien on all of
the assets that secure the company's senior secured credit
facility. Peabody intends to use the net proceeds from the sale
of the notes to fund a tender offer to purchase for cash the $650
million aggregate principal amount outstanding of its 7 3/8%
Senior Notes due 2016, to pay related fees and expenses, and for
general corporate purposes, which may include the payment of its
federal coal lease expenditures. Moody's intends to withdraw the
B3 rating on the senior notes due in 2016 upon completion of the
transaction.
Assignments:
Issuer: Peabody Energy Corporation
-- Senior Secured Regular Bond/Debenture, Assigned B2 (LGD3)
Outlook Actions:
-- Outlook, Remains Negative
Affirmations:
-- Probability of Default Rating, Affirmed B2-PD
-- Speculative Grade Liquidity Rating, Affirmed SGL-2
-- Corporate Family Rating, Affirmed B2
-- Junior Subordinated Conv./Exch. Bond/Debenture, Affirmed
Caa1 (LGD6)
-- Senior Secured Bank Credit Facility Affirmed Ba3 (LGD2)
-- Senior Unsecured Regular Bond/Debenture, Affirmed B3 (LGD5
from a range of LGD4)
The B2 rating on the second lien notes, in line with the CFR,
reflects their relative position in the capital structure with
respect to claim on collateral, behind the senior secured credit
facility but ahead of unsecured notes and subordinated debentures.
The company's B2 CFR is unaffected by the issuance, because the
benefit of the additional liquidity provided offsets the pressure
from the additional debt service burden and higher leverage. The
B2 CFR continues to reflect the recent deterioration in
performance as a result of weak market conditions and Moody's
expectation that meaningful recovery is unlikely over the next
eighteen months. The company's Debt/ EBITDA, as adjusted,
approached 7x in 2014, and Moody's anticipate Debt/ EBITDA to
exceed 8x in 2015. The company's credit profile has been
especially impacted by the weak performance of the Australian
division as a result of challenging metallurgical coal markets.
Although the company's met coal operations continue to benefit
from advantageous exchange rates, proximity to key markets in Asia
and favorable cost position relative to the US peers, they are
unable to generate meaningful EBITDA at current price levels.
Meanwhile, the company's thermal operations continue to be
challenged by competition with natural gas and regulatory
pressures in the US, as well as weak pricing in the seaborne
markets. The corporate family rating continues to reflect
Peabody's significant size and scale, broadly diversified reserves
and production base, efficient surface mining operations, and a
solid portfolio of long-term coal supply agreements with electric
utilities. The rating also reflects its competitive cost
structure compared to other US-based producers and organic growth
opportunities, as well as operational risks inherent in the coal
industry.
The speculative grade liquidity rating of SGL-2 continues to
reflect good liquidity, including cash and cash equivalents of
$298 million, $1.5 billion available under $1.65 billion revolver
and $204 million of available capacity under the accounts
receivable securitization program as of Dec.31, 2014. Pro-forma
for the proposed transactions, the company's cash and cash
equivalents would be roughly $550 million as of December 31, 2014.
The negative outlook reflects Moody's expectation that
metallurgical coal markets will remain weak over the next eighteen
months, with increasing risks to the downside, while the company's
Debt/ EBITDA, as adjusted, will continue to track above 7x.
A ratings upgrade is unlikely but would be considered if Debt/
EBITDA were to approach 5x, with neutral to mildly positive free
cash flows.
A further downgrade would be considered if liquidity deteriorated,
free cash flows were persistently negative, and/or Debt/ EBITDA
exceeded 7x on a sustained basis.
The principal methodology used in these ratings was Global Mining
Industry published in August 2014. Other methodologies used
include Loss Given Default for Speculative-Grade Non-Financial
Companies in the U.S., Canada and EMEA published in June 2009.
Peabody Energy Corporation (Peabody) is the world's largest
private sector coal company with 26 active coal mining operations
in the US and Australia and approximately 8 billion tons of proven
and probable reserves. In 2014 the company generated $6.8 billion
in revenues on 250 million tons of coal sold.
RB HOSPITALITY: Goes Into Liquidation but Doors Remain Open
-----------------------------------------------------------
The Canberra News reports that a popular inner north pub is still
serving schooners despite going into liquidation.
The Supreme Court of Queensland has ordered the winding up of RB
Hospitality Holdings Pty Ltd, which trades as ONeill's Irish Pub
in Dickson, following an application by Australian Liquor
Marketers, according to The Canberra News.
Director Gerry Bluett said the company owed Australian Liquor
Marketers AU$3700 but did not receive documentation about the
court application while the sole owner, Richard Lee, was in
hospital in Canberra, the report relates.
The pub was now working with liquidators to sort out the mess and
pay back the money, Mr. Bluett said, the report discloses.
"Unscrambling the egg is incredibly hard to do," the report quoted
Mr. Bluett as saying.
"We've got to go through the process of clearing creditors up and
making the company stable. We'd like to have a stay of execution
back but it will probably cost too much money. We'll pay all the
money, we'll trade our way through it. It's a little bit messy
and it probably shouldn't have happened. It's just a matter of
going through the process," Mr. Bluett added, notes the report.
Vincents Liquidators' Tony Lane, who is managing the wind up, said
the order was made on February 20 as the business assessed options
to avoid closure, the report notes.
"We're continuing trade with the support of the company's director
with the view to achieving an outcome for the creditors which is
better than straight liquidation. A range of options are being
considered. We're investigating all possibilities," the report
quoted Mr. Lane as saying.
The report relays that Mr. Lane would not elaborate on the
possible steps to avoid straight liquidation but expected to have
a solution settled with the director in the next week.
"The doors are still open, we're continuing to trade -- it's
business as usual," Mr. Lane added, says the report.
REALESTATE NOW: First Creditors' Meeting Set For March 11
---------------------------------------------------------
Steven Gladman of Hall Chadwick was appointed as administrator of
Realestate Now Pty Limited on March 2, 2015.
A first meeting of the creditors of the Company will be held at
The Webb Room, Bundaberg Business Enterprise Centre Cnr Quay and
Tantitha Streets, in Bundaberg, Queensland, on March 11, 2015, at
10:30 a.m.
RIDGWAY CAPITAL: First Creditors' Meeting Set For March 16
----------------------------------------------------------
Gideon Isaac Rathner -- grathner@lowelippmann.com.au -- of Lowe
Lippmann was appointed as administrator of Ridgway Capital Limited
on March 4, 2015.
A first meeting of the creditors of the Company will be held at
Level 7, 616 St Kilda Road, in Melbourne, on March 16, 2015, at
10:30 a.m.
* Australian Auto Losses Continue to Fall in 4Q14, Fitch Says
-------------------------------------------------------------
Australian prime auto ABS losses fell over 4Q14, with the
annualised net loss rate dropping 9bp to 0.37%, 2bp lower year on
year (yoy). Fitch Ratings expects net losses to rise over the
next 12 months to the 18-month average of 0.5%, as losses from
less seasoned transactions begin to flow through.
Early delinquencies rose over the quarter, with 30+ days arrears
reaching 1.06%, 11bp above 3Q14 and 5bp higher yoy. A modest 2bp
rise in 60+ days delinquencies to 0.37% suggests that rising
unemployment has yet to flow through to late-stage arrears.
Seasonality was the main driver for the lower losses and higher
delinquencies in 4Q14. Losses may appear low in the fourth
quarter due to fewer repossessions and recoveries taking place
during the month of December, and early delinquencies tend to rise
due to holiday spending pressures. The rise in delinquencies
occurred despite an increase in the collateral underlying the
index.
Prime auto ABS issuance was AUD6.0 billion in 2014, 4.7% above
2013 levels but below 2012's record AUD6.5 billion of securitised
assets. The outstanding collateral underlying the arrears index
was AUD0.3 billion above the same time last year, at
AUD10.3 billion.
=========
C H I N A
=========
AOXING PHARMACEUTICAL: Posts $602K Net Profit in Dec. 31 Quarter
----------------------------------------------------------------
Aoxing Pharmaceutical Company, Inc., filed with the U.S.
Securities and Exchange Commission its quarterly report on Form
10-Q, disclosing a net profit of $602,000 on $6.43 million of
sales for the three months ended Dec. 31, 2014, compared with a
net loss of $1.92 million on $3.47 million of sales for the same
period during the prior year.
The Company's balance sheet at Dec. 31, 2014, showed $40.93
million in total assets, $38.5 million in total liabilities, and
stockholders' equity of $2.44 million.
As of Dec. 31, 2014, the Company's current liabilities exceeded
its current assets by $20.05 million. The Company had cash and
cash equivalents of $1.34 million as of Dec. 31, 2014. The
Company's ability to continue as a going concern is dependent on
many events outside of its direct control, including, among other
things, the ability to obtain future funding. The Company's
inability to generate cash flows to meet its obligations due to
the uncertainty of achieving operating profitability on an annual
basis and raising required funding on reasonable terms, among
other factors, raises substantial doubt as to the Company's
ability to continue as a going concern.
A copy of the Form 10-Q is available at:
http://is.gd/Bk3bkY
About Aoxing
Aoxing Pharmaceutical Company, Inc (NYSE AMEX: AXN) is registered
in Florida, U.S. It is a specialty pharmaceutical company which
specializes in research, development, manufacturing and
distribution of a variety of narcotics and pain-management
products and drug-relief medicine. Aoxing has its office in Jersey
City, New Jersey and headquartered in Shijiazhuang City, outside
Beijing.
In its report on the consolidated financial statements for the
year ended June 30, 2014, BDO China Shu Lun Pan Certified Public
Accountants LLP expressed substantial doubt about the Company's
ability to continue as a going concern, citing that the Company
continues to incur losses from operations, has negative cash flow
from operations and a working capital deficit.
The Company reported a net loss of $8.63 million for the fiscal
year ended June 30, 2014, compared to a net loss of $17.29 million
last year.
As of Sept. 30, 2014, the Company had $39.07 million in total
assets, $38.44 million in total liabilities and $631,865 in total
equity.
CHINA BAK: Posts $17.4M Profit in Dec. 31 Quarter
-------------------------------------------------
China BAK Battery, Inc., filed with the U.S. Securities and
Exchange Commission its quarterly report on Form 10-Q, disclosing
net profit of US$17.4 million on US$3.08 million of net revenues
for the three months ended Dec. 31, 2014, compared with a net loss
of US$5.28 million on US$41.2 million of net revenues for the same
period in 2013.
The Company's balance sheet at Dec. 31, 2014, showed US$44.5
million in total assets, US$31.59 million in total liabilities and
total stockholders' equity of US$12.91 million.
The Company had a working capital deficiency, accumulated deficit
from recurring net losses incurred for prior years and short-term
debt obligations as of Sept. 30, 2014 and Dec. 31, 2014. These
factors raise substantial doubts about the Company's ability to
continue as a going concern, according to the regulatory filing.
A copy of the Form 10-Q is available at:
http://is.gd/3FMmSx
China BAK Battery conducted business through BAK International
Limited and its subsidiaries that produced prismatic cells,
cylindrical cells, lithium polymer cells and high power lithium
batters. The BAK International business was foreclosed on
June 30, 2014. Consequently, China BAK is looking to develop,
manufacture and sell energy high power lithium batteries primarily
for electric vehicles when its Dalian, China manufacturing
facilities start to operate in the first quarter of 2015.
Crowe Horwath (HK) CPA Limited expressed substantial doubt about
the Company's ability to continue as a going concern, citing that
the Company has net liabilities, a working capital deficiency,
accumulated deficit from recurring net losses and significant
short-term debt obligations maturing in less than one year as of
Sept. 30, 2014.
The Company reported net income of US$37.8 million on US$123
million of net revenues for the fiscal year ended Sept. 30, 2014,
compared with a net loss of US$116 million on US$186 million of
net revenues in the prior year.
The Company's balance sheet at Sept. 30, 2014, showed US$44.0
million in total assets, US$48.3 million in total liabilities,
anda stockholders' deficit of US$4.33 million.
CHINA GERUI: Receives Nasdaq Listing Non-Compliance Notice
----------------------------------------------------------
China Gerui Advanced Materials Group Limited, a high- precision,
cold-rolled steel producer in China, on March 2 disclosed that on
Feb. 24, 2015, it received a written notice from the Listing
Qualifications department of The Nasdaq Stock Market indicating
that the Company is not in compliance with the Nasdaq Listing Rule
5450(b)(1)(c) because the market value of publicly held shares
("MVPHS") of the Company's ordinary shares has fallen below the
minimum $5,000,000 requirement for continued listing for a period
of at least 30 consecutive business days. However, the Nasdaq
Listing Rules also provides the Company a compliance period of 180
calendar days, or until Aug. 24, 2015, to regain compliance. If at
any time before Aug. 24, 2015, the MVPHS of the Company's ordinary
shares is $5,000,000 for a minimum of 10 consecutive business
days, the Company will regain compliance with this rule.
In the event the Company does not regain compliance with the
Nasdaq Rules prior to the expiration of the 180-day compliance
period, it will receive written notification from Nasdaq that the
Company's ordinary shares are subject to delisting.
Alternatively, Nasdaq may permit the Company to transfer its
ordinary shares to The Nasdaq Capital Market if, at that time, the
Company satisfies the Nasdaq Capital Market's continued listing
requirements.
At present, China Gerui will strategically review its business
outlook and determine whether and how it can regain compliance
during the initial 180 day compliance period and will actively
monitor its performance with respect to the listing standards.
The Notice has no immediate effect at this time on the listing of
the Company's ordinary shares and will continue to trade on the
Nasdaq Global Select Market under the ticker symbol "CHOP."
About China Gerui Advanced Materials Group
China Gerui Advanced Materials Group Limited --
http://www.geruigroup.com/-- is a niche and high value-added
steel processing company in China. The Company produces high-end,
high-precision, ultra-thin, high- strength, cold-rolled steel
products that are characterized by stringent performance and
specification requirements that mandate a high degree of
manufacturing and engineering expertise. China Gerui's products
are not standardized commodity products. Instead, they are
tailored to customers' requirements and subsequently incorporated
into products manufactured for various applications. The Company
sells its products to domestic Chinese customers in a diverse
range of industries, including the food and industrial packaging,
construction and household decorations materials, electrical
appliances, and telecommunications wires and cables.
MAOYE INTERNATIONAL: S&P Lowers CCR to 'BB'; Outlook Negative
-------------------------------------------------------------
Standard & Poor's Ratings Services said that it had lowered its
long-term corporate credit rating on Maoye International Holdings
Ltd. to 'BB' from 'BB+'. The outlook is negative. S&P also
lowered its long-term issue rating on the company's senior
unsecured notes to 'BB-' from 'BB'. In line with the rating
change, S&P lowered its long-term Greater China regional scale
rating on the China-based department store operator to 'cnBB+'
from 'cnBBB' and on the notes to 'cnBB' from 'cnBBB-'.
"We lowered the rating because Maoye's financial leverage has
increased more than we previously expected, and we don't
anticipate any meaningful reduction over the next six to 12
months," said Standard & Poor's credit analyst Lillian Chiou.
S&P believes that the correction in China's property market will
continue in 2015 and retail sales prospects will remain weak in
the country.
S&P estimates that Maoye's debt-to-EBITDA ratio will stay above
5.0x in 2015, compared with 6.2x in 2014. The company continued
to expand, and it has planned large capital spending despite its
weak financial performance and unfavorable industry conditions.
Cash flows from Maoye's property business in 2014 were materially
weaker than S&P's expectation because of the company's aggressive
debt-funded expenditure in property development despite a weak
property market. Capital expenditure for the property business
increased to Chinese renminbi (RMB) 3.4 billion in 2014, from
RMB1.8 billion in 2013. Total debt rose materially to fund
expansion and inventory as sales lagged behind.
S&P expects Maoye to expedite property sales and reduce its
inventory level by RMB1.0 billion-RMB1.5 billion in 2015 through
reduced land purchases. The company's property inventory,
including property under development, increased 51% to RMB7.1
billion in 2014, from RMB4.7 billion in the previous year.
S&P anticipates that Maoye's property revenue will be weak in
2015. The company's realized property sales of RMB533 million in
2014 were significantly below S&P's expectation of RMB800 million-
RMB1 billion because of the Chinese government's measures to cool
down property transactions. S&P expects 2015 to be another
challenging year for the property sector, especially for a smaller
developer like Maoye that focuses on lower-tier cities where the
competition is more intense and margins are lower.
"Maoye's department stores operations are likely to remain
challenging over the next 12 months, and the company could report
flat-to-negative growth in same-store sales in 2015," said
Ms. Chiou. "The company's higher exposure to lower-tier cities,
where we believe oversupply of retail space is more critical than
in larger cities, also increases the difficulty of turning around
the retail business."
Maoye's large portfolio of self-owned commercial properties in
prime locations is a competitive strength, in S&P's opinion. The
company could sell some of the properties in times of distress for
cash to reduce debt and improve liquidity. This strength is
reflected in the one-notch positive adjustment to Maoye's stand-
alone credit profile for comparable rating analysis.
The negative outlook reflects S&P's view that Maoye's cash flows
could weaken if the company doesn't reduce its property inventory
and slow down its debt-funded expansion over the next 12 months.
In S&P's base case, it expects Maoye's debt-to-EBITDA ratio to
stay above 5.0x and EBITDA interest coverage to be 2.5x over the
period.
S&P could lower the rating if Maoye's EBITDA interest coverage
drops below 2.5x over the next 12 months. This could happen if:
(1) the company's property presales are weaker that S&P expects
and inventory buildup continues to outpace sales and capital
expenditure; (2) Maoye's retail sales and profitability are
materially weaker than S&P's expectation; or (3) Maoye takes on
more debt-funded expansion.
S&P could revise the outlook to stable if Maoye's leverage
declines such that its debt-to-EBITDA ratio falls below 5x and
EBITDA interest coverage improves to above 3.0x. This could
happen if the company reduces its inventory on property
development materially and adopts a more conservative growth
strategy and financial policy.
TIMES PROPERTY: Moody's Rates New USD Sr. Unsec. Notes at 'B2'
--------------------------------------------------------------
Moody's Investors Service assigned a B2 rating to the USD senior
unsecured notes proposed by Times Property Holdings Limited.
At the same time, Moody's has affirmed Times Property's B1
corporate family rating.
The ratings outlook is stable.
Times Property plans to use the note proceeds to refinance certain
of its existing indebtedness, finance its existing and new
property development projects (including land premium and
construction costs) and for other general corporate purposes.
"The B2 rating on the notes mainly reflects Times Property's B1
corporate family rating and the risk related to structural
subordination," says Fiona Kwok, a Moody's Analyst.
Times Property's B1 corporate family rating reflects its
established brand in Guangdong Province, low-cost land acquisition
strategy, and good liquidity. The rating also considers the
company's moderate scale, short operating history, geographical
concentration, as well as risks related to its fast expansion.
"Although the proposed notes will increase Times Property's debt
leverage, it will remain within the B1 corporate family rating
level. On the other hand, the proposed USD notes will further
strengthen its liquidity position and lengthen the average tenure
of its debt portfolio," adds Kwok, who is also the Lead Analyst
for Times Property.
As Times Property will use a portion of the bond proceeds to
refinance existing debt, Moody's expects its debt leverage, as
measured by revenue to debt, will be around 85%-90% in the next 18
months, a mild drop from 2014 level of 94%.
In addition, Moody's expects its adjusted EBITDA margin to stay
between 20%-25%, similar to 24% in 2014, and its adjusted
EBITDA/interest to be around 2.0x. This is because an expected
growth in earnings should offset the impact of the higher debt,
based on its robust contracted sales growth. The company's
contracted sales grew 38% year-on-year in 2014 despite the
persistent weakness in the property market.
These ratios are in line with its B1 corporate family rating.
At end- 2014, Times Property held a strong cash position of RMB5.4
billion. This amount can fully covers its short-term debt of
around RMB1.8 billion and committed land payments of RMB2.5
billion, including land acquisitions made in January 2015.
Its cash to short-term debt was high at 3.0x at end-December 2014,
a level which is very strong when compared to other single-B rated
peers.
Times Property's bond rating is notched down by one notch to B2
due to subordination risk, as Moody's expects the company's
secured and subsidiary debt to total assets ratio will stay above
15% over the medium term. The ratio stood at 17% as of December
2014.
The stable outlook reflects Moody's expectation that the company
will maintain adequate liquidity and will grow sales in a prudent
manner, without materially altering its current financial profile,
product focus and geographic coverage.
Upward rating pressure could emerge over the medium term if Times
Property establishes a track record of (1) achieving planned sales
and improving revenue recognition efficiency; (2) maintaining a
reasonable cash balance at above 150% of debt maturing in 12
months; and (3) maintaining strong financial discipline such that
revenue/debt is above 120% and EBTIDA/interest is above 3x on a
sustained basis.
Downward rating pressure could emerge if (1) Times Property's
liquidity and operating cash flow generation deteriorate because
of weak contracted sales, aggressive land acquisitions, or the
emergence of more severe regulatory controls on China's property
sector; (2) there is a decline in prices, slower-than-expected
revenue recognition, or a fall in profit margins, negatively
affecting interest coverage and/or financial flexibility; or (3)
the company engages in material debt-funded acquisitions.
Metrics indicative of downward rating pressure include balance-
sheet cash -- including restricted and unrestricted cash --
falling below 100% of debt maturing in 12 months, and/or
EBITDA/interest remaining under 2x.
The principal methodology used in this rating was Global
Homebuilding Industry published in March 2009.
Times Property Holdings Limited is a small- to medium-sized
property developer based in Guangdong Province. It focuses on
meeting end-user demand for mass-market housing.
At end-December 2014, it had 27 major property projects in five
cities in Guangdong Province, including Guangzhou, as well as
Changsha in Hunan Province, and a total land bank of around 9.43
million square meters.
=========
I N D I A
=========
A.V. VALVES: CARE Reaffirms B/A4 Rating on INR4.8cr LT/ST Loan
--------------------------------------------------------------
CARE reaffirms ratings assigned to the bank facilities of
A.V. Valves Limited.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long term/short term 4.80 CARE B/CARE A4
Bank Facilities Reaffirmed
Short-term Bank Facilities 3.00 CARE A4 Reaffirmed
Rating Rationale
The ratings assigned to the bank facilities of A V Valves Limited
(AVL) continue to be constrained by the small and declining scale
of operations and working capital intensive nature of operations.
The ratings are further constrained by AVL's revenue concentration
to the oil and gas industry. The ratings also take cognizance of
the delay in execution of project in association with ongoing
modernisation-cum-up gradation of its existing plant.
The ratings continue to favourably factor in the experience of the
promoters, AVL's moderate profitability margins and capital
structure and its established relationship with reputed customers.
Going forward, the ability of the company to increase its scale of
operation while efficiently managing its working capital
requirement and complete the ongoing capex within cost and time
estimates shall be the key rating sensitivities.
Agra based, A.V. Valves Limited (AVL) is a closely held public
limited company. The company was initially incorporated as A.V.
Engineering Works, a proprietorship concern by Mr Satish Jain in
1971, the firm was reconstituted as a partnership firm in 1974 and
later on reconstituted as a private limited company in 1987.
Subsequently the company got its present status in 1992. AVL is
promoted by MrSatish Jain, Mr Subhash Jain, Mr Kailash Jain and Mr
Vikas Jain (all family members) with the promoters having industry
experience of more than 3 decades. The company is engaged in
manufacturing of industrial valves which are mainly used in oil
and gas, petro-chemical and general engineering industry. The
manufacturing facility is situated at Agra, Uttar Pradesh with
installed capacity of 2,913 tonnes per anumm (TPA). The main raw
materials for manufacturing the product are pig iron, mild steel
and stainless steel which are procured domestically. The company
sells its product to private companies and public sector units
(PSU's). The company earns around 85% of revenue from domestic
sales and the remaining from exports.
AVL reported a PAT of INR0.62 crore on a total income of INR15.74
crore in FY14 (refers to the period April 1 to March 31) as
against a PAT of INR0.39 crore on a total income of INR20.66 crore
in FY13. AVL has achieved a total operating income of INR13.82
crore till December 31, 2014.
ANABELL PAPER: CRISIL Suspends D Rating on INR50MM Cash Credit
--------------------------------------------------------------
CRISIL has suspended its ratings on the bank facilities of
Anabell Paper Mills Pvt Ltd (Anabell).
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 50 CRISIL D Suspended
Long Term Loan 50 CRISIL D Suspended
The suspension of ratings is on account of non-cooperation by
Anabell with CRISIL's efforts to undertake a review of the ratings
outstanding. Despite repeated requests by CRISIL, Anabell is yet
to provide adequate information to enable CRISIL to assess
Anabell's ability to service its debt. The suspension reflects
CRISIL's inability to maintain a valid rating in the absence of
adequate information. CRISIL considers information availability
risk as a key credit factor in its rating process and non-sharing
of information as a first signal of possible credit distress, as
outlined in its criteria 'Information Availability Risk in Credit
Ratings'
Incorporated in 2006, Anabell manufactures duplex paperboards. The
company's operations are managed by Mr. C Subhasingh.
ARIHANT SPINTEX: CRISIL Assigns B+ Rating to INR160.6MM Term Loan
-----------------------------------------------------------------
CRISIL has assigned its 'CRISIL B+/Stable' rating to the long-term
bank facilities of Arihant Spintex Pvt Ltd (ASPL).
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 39.4 CRISIL B+/Stable
Term Loan 160.6 CRISIL B+/Stable
The rating reflects ASPL's start-up nature of operations,
susceptibility to intense industry competition and vulnerability
to volatility in raw material prices. These rating weaknesses are
partially offset by ASPL's average financial risk profile marked
by an above-average capital structure and moderate working capital
requirements.
Outlook: Stable
CRISIL believes that ASPL will continue to benefit over the medium
term from its moderate profitability and moderate working capital
requirements. The outlook may be revised to 'Positive' if the
company generates higher-than-expected cash accruals while
managing its working capital requirements efficiently. Conversely,
the outlook may be revised to 'Negative' in case the company
reports deterioration in its working capital cycle or in case of
lower-than-expected cash accruals which adversely impacts its
liquidity.
ASPL, incorporated in 2011, manufactures cotton yarn. The company
has its manufacturing facility at Amloh (Punjab) and is promoted
by Mr. Surinder Kumar and Mr. Manoj Mittal.
ASIA MATCH: CRISIL Suspends B+ Rating on INR70MM Cash Credit
------------------------------------------------------------
CRISIL has suspended its ratings on the bank facilities of Asia
Match Co. (P) Ltd (AMCPL).
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 70 CRISIL B+/Stable Suspended
Letter of Credit 10 CRISIL A4 Suspended
The suspension of ratings is on account of non-cooperation by
AMCPL with CRISIL's efforts to undertake a review of the ratings
outstanding. Despite repeated requests by CRISIL, AMCPL is yet to
provide adequate information to enable CRISIL to assess AMCPL's
ability to service its debt. The suspension reflects CRISIL's
inability to maintain a valid rating in the absence of adequate
information. CRISIL considers information availability risk as a
key credit factor in its rating process and non-sharing of
information as a first signal of possible credit distress, as
outlined in its criteria 'Information Availability Risk in Credit
Ratings'
AMCPL, a Pioneer Asia group company, manufactures safety matches
at Sivakasi (Tamil Nadu).
ATMIYA ENGINEERING: CRISIL Assigns C Rating to INR51.7MM Loan
-------------------------------------------------------------
CRISIL has assigned its 'CRISIL C' rating to the bank facilities
of Atmiya Engineering and Plastics (AEP).
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Working Capital 51.7 CRISIL C
Term Loan
Cash Credit 4.0 CRISIL C
Long Term Loan 34.3 CRISIL C
The rating reflects the firm's weak liquidity owing to time
required for stabilisation of operations after major fire in its
manufacturing premises. The rating also reflects AEP's inability
to post sufficient accruals for meeting repayment obligations. The
firm's revenue profile is further constrained on account of high
customer concentration owing to a single customer. These rating
weaknesses are partially offset by the extensive experience of the
promoters in manufacturing plastic parts for air-coolers.
Incorporated in 1999 and based in Vadodara (Gujarat), AEP is
promoted by Mr. Nimesh Patel. The firm manufactures plastic parts
for air-coolers.
For 2013-14 (refers to financial year, April 1 to March 31), AEP
reported net profit of INR14.5 million on net sales of INR229
million against net profit of INR13.1 million on net sales of
INR250.2 million for 2012-13.
BALAJI POLYSACKS: CRISIL Rates INR100MM Cash Loan at B-
-------------------------------------------------------
CRISIL has revoked the suspension of its ratings on the bank
facilities of Balaji Polysacks Pvt Ltd (BPPL), and has assigned
its 'CRISIL B-/Stable/CRISIL A4' ratings to these facilities.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Bank Guarantee 30 CRISIL A4 (Assigned;
Suspension revoked)
Cash Credit 100 CRISIL B-/Stable (Assigned;
Suspension revoked)
Letter of Credit 30 CRISIL A4 (Assigned;
Suspension revoked)
Term Loan 9.5 CRISIL B-/Stable (Assigned;
Suspension revoked)
Standby Letter of 10 CRISIL B-/Stable (Assigned;
Credit Suspension revoked)
The rating had earlier been suspended by CRISIL as per its rating
rationale dated December 9, 2013, as BPPL had not provided the
necessary information required for reviewing the ratings. BPPL has
now shared the requisite information, thereby enabling CRISIL to
assign rating to the bank facilities.
The ratings reflect BPPL's large working capital requirements and
modest scale of operations in the competitive high-density
polyethylene (HDPE) bags business. These rating weaknesses are
partially offset by the extensive experience of the promoters in
the HDPE industry.
For arriving at the ratings, CRISIL has treated INR30 million of
unsecured loans from the promoters and family members as neither
debt nor equity based on the undertaking from the management that
the same will remain in the business over the medium term.
Outlook: Stable
CRISIL believes that BPPL will maintain its business risk profile
over the medium term, backed by its promoters' experience in the
HDPE bags business. The outlook may be revised to 'Positive' in
case of substantial improvement in the company's accruals or
better working capital management, leading to improvement in its
liquidity. Conversely, the outlook may be revised to 'Negative' if
the financial risk profile deteriorates on account of any large
debt-funded capital expenditure, lengthening of the working
capital cycle, or lower-than-expected accruals.
Incorporated in 1995, BPPL is into manufacturing of HDPE bags. The
company's manufacturing facility is located in West Bengal and its
day-to-day operations are managed by Mr. Sushil Agarwal.
BHARAT CATTLEFEED: CRISIL Reaffirms B+ Rating on INR40MM Loan
-------------------------------------------------------------
CRISIL ratings on the bank loan facilities of Bharat Cattlefeed
Industries (BCI) continue to reflect firm's exposure to intense
competition and susceptibility of its operating margins to
fluctuations in raw material prices and its average financial risk
profile marked by leveraged capital structure and weak debt
protection metrics. The above mentioned weaknesses are partially
offset by the extensive experience of its promoters in cattle feed
industry.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 40 CRISIL B+/Stable (Reaffirmed)
Proposed Long Term
Bank Loan Facility 40 CRISIL B+/Stable (Reaffirmed)
Outlook: Stable
CRISIL believes that BCI will continue to benefit from its
promoters' extensive industry experience over the medium term. The
outlook may be revised to 'Positive' in case the firm financial
risk profile improves significantly backed by significant
accruals, better working capital management and or equity
infusion. Conversely, the outlook may be revised to 'Negative' in
case BCI's liquidity deteriorates on account of stretch in working
capital cycle or its profitability declines, or it undertakes any
large debt-funded capital expenditure programme.
Update
BCI reported net sales of INR213.2 million in 2013-14 (refers to
financial year, April 1 to March 31), as compared to INR257.5
million a year ago, witnessing year-on-year decline of 17 per
cent. With net sales of INR138.2 million till September 30, 2014,
healthy sales growth of 40 per cent is expected in current
financial year. Operating margins improved to 5.2 per cent in
2013-14 as compared to 3.5 per cent a year ago. Working capital
requirements increased as is marked by gross current assets of 148
days as on March 31, 2014 as compared to 71 days a year ago. Short
term borrowings remained high with average utilization of 97 per
cent for the 12 months ended November, 2014. Gearing remained high
at 3.45 times as on March 31, 2014 while debt protection metrics
remained moderate with interest coverage and net cash accruals to
total debt ratio (NCATD) of 2.6 times and 0.02 times respectively
for 2013-14. BCI liquidity finds support from no term loan
outstanding and accruals of around INR5 million expected to be
generated over medium term.
BCI reported a profit after tax (PAT) of INR3.9 million on net
sales of INR213.2 million for 2013-14, against a PAT of INR2.8
million on net sales of INR257.5 million for 2012-13.
BCI was established in the year 1999. The firm is engaged into
manufacturing of cattle feed products. The firm is a
proprietorship firm and is promoted by Mr. Sunil Shah.
BHAWANI STEELS: CRISIL Assigns B- Rating to INR65MM Cash Credit
---------------------------------------------------------------
CRISIL has revoked the suspension of its rating on the long-term
bank facilities of Bhawani Steels Pvt Ltd (BSPL), and has assigned
its 'CRISIL B-/Stable' rating to the long term bank loan
facilities. CRISIL had suspended the rating on May 23, 2014, as
BSPL had not provided the necessary information required for a
rating review. The company has now shared the requisite
information, enabling CRISIL to assign a rating to the company's
bank facilities.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 65 CRISIL B-/Stable (Assigned;
Suspension revoked)
The rating reflects BSPL's weak financial risk profile, small
scale of operations, and susceptibility to volatility in raw
material prices. These ratings weaknesses are partially offset by
the extensive experience of the company's promoter in the copper
industry.
Outlook: Stable
CRISIL believes that BSPL will benefit over the medium term from
its promoter's extensive industry experience and established
relationship with customers. The outlook may be revised to
'Positive' if there is a substantial improvement in the company's
revenue and profitability margins or if there is a significant
improvement in its debt protection metrics, backed by increased
cash accruals. Conversely, the outlook may be revised to
'Negative' if there is a steep decline in BSPL's profitability or
significant deterioration in its capital structure on account of
sizeable working capital requirements.
Established in 1985, BSPL was acquired by its current promoter,
Mr. Manoj Jain, in 1994. The company manufactures copper rods that
are primarily used to manufacture copper cables. BSPL's
manufacturing facility is located in SSI Industrial Area (Delhi).
BSPL reported a net profit of INR0.5 million on net sales of
INR229 million for 2013-14 (refers to financial year, April 1 to
March 31), against a net profit of INR1.0 million on net sales of
INR226 million for 2012-13.
CRIMSON METAL: CARE Reaffirms B Rating on INR11.65cr LT Loan
------------------------------------------------------------
CARE reaffirms the rating assigned to bank facilities of Crimson
Metal Engineering Company Limited.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long term Bank Facilities 11.65 CARE B Reaffirmed
Short-term Bank Facilities 3.50 CARE A4 Reaffirmed
Rating Rationale
The ratings assigned to the bank facilities of Crimson Metal
Engineering Company Limited (CMECL) continue to draw strength from
experience of the promoters in the steel industry. The ratings
continue to be constrained by volatility in prices of raw material
and finished goods, low cash accruals and leveraged capital
structure.
The ratings favourably factor in the customer base of the company
and the long standing relationship the company has with the
customers.
CMECL, formerly known as Sri Saarbati Steel Tubes Limited, was
incorporated in February 1985 by Mr Vinay Kumar Goyal of Chennai
and is engaged in the manufacturing of Electrical Resistance
Welded (ERW) pipes and tubes like Black & GI pipes, GP coils,
square and rectangular pipes, etc. CMECL is a one of the leading
manufacturers of both galvanised and black pipes from «" to 10"
sizes with a pipe manufacturing capacity of 55,000 metric tonnes
per annum (MTPA), skelp production capacity of 36,000 MTPA, 24,000
MTPA rolling mill and galvanising plant of 18,000 MTPA. The
manufacturing facilities of the company are located at
Pondicherry. From the financial year 2000-2001, the company
started incurring huge losses (resulting in erosion of its net
worth) due to the heavy input and interest costs and fall in
demand for its products. Consequently, the company was referred to
BIFR in September 2001. However, through restructuring the
capital base of the company and infusion of fresh capital by the
promoter and directors the company came out of the purview of BIFR
in October 2011.
For the year ended March 2014, Crimson has registered a net profit
of INR1.8 crore on a total operating income of INR63.0 crore. For
the 6 months ended September 2014 (Provisional), Crimson has
registered a net profit of INR0.1 crore on a total operating
income of INR21.8 crore.
DC INDUSTRIAL: CARE Reaffirms D Rating on INR188cr ST Loan
----------------------------------------------------------
CARE reaffirmed ratings assigned to bank facilities of DC
Industrial Plant Services Pvt Ltd.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long term Bank Facilities 64.5 CARE D Reaffirmed
Short term Bank Facilities 188 CARE D Reaffirmed
Rating Rationale
The ratings of DC Industrial Plant Services Pvt. Ltd (DCIPS) takes
into account the ongoing delays in debt servicing on account of
stressed liquidity position of the company. The ability of the
company to improve its liquidity and regularize its debt servicing
will be the key rating sensitivity.
DCIPS incorporated in June 1983 is a premier turnkey ash handling
system contractor for coal based power plant projects in India.
The company was a wholly-owned subsidiary of Development
Consultants Pvt Ltd (DCPL), an established player in the area of
engineering & consulting services in various industries especially
in the power sector. However, the Chatterjee Group (TCG) has
acquired 50% stake in DCIPS in FY14 (refers to the period April 1
to March 31). Accordingly, the company is now jointly owned by
DCPL and TCG group. The contracts being executed by DCIPS include
complete design, engineering, supply and installation including
civil works of ash handling plants. The company also undertakes
contracts for operation and maintenance of such plants along with
supplying spare parts.
In FY14, DCIPS reported a loss at PAT level of INR8.7 crore (loss
of INR15.8 crore in FY13) on a total operating income of INR51.4
crore (INR87.5 crore in FY13).
DEVANS MODERN: CRISIL Assigns 'D' Rating to INR507MM Term Loan
--------------------------------------------------------------
CRISIL has assigned its 'FD' rating to the Fixed Deposits of
Devans Modern Breweries Ltd (DMBL; part of Devans group), and
downgraded its rating on the long term bank facilities to 'CRISIL
D' from 'CRISIL BB-/Negative' while assigning its 'CRISIL D'
rating to short term bank facilities.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Bank Guarantee 10 CRISIL D (Downgraded from
'CRISIL BB-/Negative')
Cash Credit 450 CRISIL D (Downgraded from
'CRISIL BB-/Negative')
Term Loan 507 CRISIL D (Assigned)
Proposed Long Term
Bank Loan Facility 223 CRISIL D (Assigned)
Fixed Deposits 0.40 FD (Assigned)
The rating downgrade reflects recent instances of delay by DMBL in
servicing its term loan. The delays have been caused by DMBL's
stretched liquidity, driven by its large capital expenditure
(capex) and its low operating profitability, due to intensifying
competition, which led to low cash accruals.
The Devans group has a below-average financial risk profile,
marked by high gearing and weak debt protection metrics, and its
susceptibility to regulatory changes and to intense industry
competition. These rating weaknesses are partially offset by the
group's established and recognised Godfather brand in the beer
segment.
For arriving at its rating, CRISIL has combined the business and
financial risk profiles of DMBL and Devson Private Ltd. (DPL).
This is because the two companies, together referred to as the
Devans group, have a common management, intercompany shareholding,
and strong operational linkages.
The Devans group was established by the late Mr. G C Dewan in
1952. DPL was set up in 1952 as a trader of liquor and beer in
Jammu and Kashmir (J&K). DMBL set up in 1962 as a liquor-bottling
unit, manufactures malt spirit, beer, and Indian-made foreign
liquor. Its facilities in Kotputli (Rajasthan) and Sambha (Jammu)
have a combined brewing capacity of 125,000 kilolitres per annum.
The company derives over 80 per cent of its revenue from beer,
sold predominantly in northern and eastern India under its
flagship brand, Godfather.
For 2013-14 (refers to financial year, April 1 to March 31), DMBL
reported a net loss of INR50.8 million on net sales of INR2172.6
million, against a net loss of INR46.6 million on net sales of
INR2004.5 million for the previous year.
DHARANI TEXTILES: CRISIL Cuts Rating on INR224.7MM Loan to D
------------------------------------------------------------
CRISIL has downgraded its ratings on the bank facilities of
Dharani Textiles Pvt Ltd (DTPL; part of the Mehala group) to
'CRISIL D/CRISIL D' from 'CRISIL C /CRISIL A4.'
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Bank Guarantee 17.7 CRISIL D (Downgraded from
'CRISIL A4')
Cash Credit 214.8 CRISIL D (Downgraded from
'CRISIL C')
Funded Interest 106.2 CRISIL D (Downgraded from
Term Loan 'CRISIL C')
Letter of Credit 37 CRISIL D (Downgraded from
'CRISIL A4')
Term Loan 224.7 CRISIL D (Downgraded from
'CRISIL C')
Working Capital 210.0 CRISIL D (Downgraded from
Term Loan 'CRISIL C')
The rating downgrade reflects instances of delays by the Mehala
Group in meeting the repayment obligations on its term debt. The
delays have been caused by the group's weak liquidity.
The Mehala group also has a below-average financial risk profile,
marked by a small net worth and weak debt protection metrics, and
is susceptible to volatility in raw material prices. The group,
however, benefits from its established position in the textile
cotton yarn market and its promoter's industry experience.
For arriving at the ratings, CRISIL has combined the business and
financial risk profiles of DTPL and Mehala Carona Textiles Private
Limited (MCT). This is because MCT and DTPL, together referred to
as the Mehala group, are in the same line of business, have close
operational and financial linkages, including fungible cash flows,
and are under a common management.
MCT was set up in 1994 by Mr. R Doraisamy in Tirupur (Tamil Nadu).
The company manufactures hosiery yarn.
DUKE SPONGE: CARE Revises Rating on INR25cr LT Loan to B+
---------------------------------------------------------
CARE revokes suspension and revises the long-term rating and
assigns the short term rating to the bank facilities of Duke
Sponge and Iron Private Limited.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank Facilities 25 CARE B+ Suspension
revoked and rating
revised from CARE B
Short-term Bank Facilities 5 CARE A4 Assigned
Rating Rationale
The revision in the long-term rating assigned to the bank
facilities of Duke Sponge & Iron Private Limited (DSIP) takes into
consideration infusion of funds by the promoters during FY14
(refers to the period April 01 to March 31) resulting in the
improvement in liquidity position of the company. The revision
also factors in growth in the scale of operations with
improvement in profitability margins during FY14.
The ratings, however, continue to remain constrained by DSIP's
weak financial risk profile characterised by low profitability
margins, leveraged capital structure, weak debt service coverage
indicators and working capital-intensive nature of operations. The
ratings are further constrained by DSIP's short track record of
operations and its presence in highly competitive and fragmented
industry.
The ratings continue to draw comfort from the experience of the
promoters and growing scale of operations. Going forward, the
ability of DSIP to improve the financial risk profile along with
efficient management of working capital shall be the key rating
sensitivities.
Delhi-based DSIP was incorporated in the year 2009 and commenced
commercial operations from July 2011. DSIP was promoted by Mr Prem
Chand Gupta and Mr Parag Gupta (son of Mr P C Gupta). DSIP is
currently engaged in the trading of aluminium ingots, aluminium
wire rods & all types of aluminium products & scraps. The company
procures trading materials from Bharat Aluminium Company Ltd
(BALCO), Vedanta Resources PLC and Hindustan Aluminium Company
Ltd.
(HINDALCO), etc, and supplies all over the northern India, viz,
Delhi, Haryana, Punjab, Ghaziabad and Jammu & Kashmir through its
consignment agents.
For FY14 (refers to the period April 1 to March 31), DSIP achieved
a Total Operating Income (TOI) of INR90.32 crore with PAT of
INR0.64 crore as against TOI of INR67.67 crore with PAT of INR0.44
crore in FY13. During FY15, the company had achieved TOI of
INR78.73 crore till January 2015.
DURGASHAKTI FOODS: CRISIL Ups Rating on INR80MM Loan to 'B'
-----------------------------------------------------------
CRISIL has upgraded its rating on the long-term bank facilities of
Durgashakti Foods Pvt Ltd (DFPL) to 'CRISIL B/Stable' from 'CRISIL
D'.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 70 CRISIL B/Stable (Upgraded
from 'CRISIL D')
Term Loan 80 CRISIL B/Stable (Upgraded
from 'CRISIL D')
The rating upgrade reflects the improvement in DFPL's liquidity
which has enabled the company to timely service its debt
obligations over the six months through January 2015. CRISIL
believes that DFPL will maintain its improved liquidity over the
medium term, supported by its management's focus on improving
profitability and working capital efficiency, and the absence of
any significant capital expenditure (capex) plan.
The rating reflects DFPL's below-average financial risk profile,
marked by weak capital structure and subdued debt protection
metrics, its large working capital requirements, and the
vulnerability of its operating profitability to volatility in raw
material prices. These rating weaknesses are partially offset by
the extensive experience of DFPL's promoters in the edible oils
industry and the company's proximity to raw material sources.
Outlook: Stable
CRISIL believes that DFPL will continue to benefit over the medium
term from its promoters' extensive industry experience. The
outlook may be revised to 'Positive' if the company's financial
risk profile, particularly its liquidity, improves with increase
in cash accruals or infusion of funds by promoters. Conversely,
the outlook may be revised to 'Negative' if DFPL's liquidity
weakens because of a decline in cash accruals, or stretched
working capital cycle, or large debt-funded capex.
DFPL was set up in 2008 by Mr. Shashikant Sureka and his two
brothers to expand their family-run edible oil business. The
family has been manufacturing and selling crude edible oils (soya
and sunflower) and de-oiled cakes for more than two decades.
DFPL's production facility is in Khamgaon (Maharashtra).
FLEXICAN BELLOWS: CRISIL Assigns B+ Rating to INR40MM Cash Loan
---------------------------------------------------------------
CRISIL has assigned its 'CRISIL B+/Stable/ CRISIL A4' ratings to
the bank loan facilities of Flexican Bellows and Hoses Pvt Ltd
(FBHPL).
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Inland/Import Letter 60 CRISIL A4
of Credit
Cash Credit 40 CRISIL B+/Stable
Cash Term Loan 10.7 CRISIL B+/Stable
The ratings reflect FBHPL's modest scale of operations in the
highly fragmented engineering goods industry, its large working
capital requirements, and its average gearing. These rating
weaknesses are partially offset by the extensive experience of the
company's promoters in manufacturing bellows and hoses, their
long-standing relationships with distributors and suppliers, and
its comfortable liquidity.
Outlook: Stable
CRISIL believes that FBHPL will continue to benefit over the
medium term from its promoters' extensive industry experience. The
outlook may be revised to 'Positive' if the company reports
substantial revenue, while improving its profitability and capital
structure. Conversely, the outlook may be revised to 'Negative' if
FBHPL's financial risk profile, particularly its liquidity,
weakens, most likely due to a considerable decline in its revenue
and profitability, or inefficient working capital management, or
large debt-funded capital expenditure.
Incorporated in 1989, FBHPL is subsidiary of Zaverchand Gaekwas
Ltd. The company manufactures engineering goods such as hoses and
bellows.
For 2013-14 (refers to financial year, April 1 to March 31), FBHPL
reported a net loss of INR9.9 million on sales of INR121.7
million, against a net profit of INR9.1 million on sales of
INR151.8 million for 2012-13.
H K LUMBERS: CRISIL Assigns B Rating to INR15MM Cash Credit
-----------------------------------------------------------
CRISIL has assigned its 'CRISIL B/Stable/CRISIL A4' ratings to the
long-term bank facilities of H K Lumbers LLP (HKL).
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Proposed Cash Credit Limit 15 CRISIL B/Stable
Proposed Letter of Credit 55 CRISIL A4
The ratings reflect susceptibility of HKL's profitability to
intense competition in timber trading industry, regulatory changes
in timber business, and fluctuations in forex rates, its average
financial risk profile, and working capital intensive operations.
These rating weaknesses are partially offset by the extensive
industry experience of the promoters in the timber trading
industry, and its established relationships with customers and
suppliers.
Outlook: Stable
CRISIL believes that the HKL's business risk profile will benefit
from promoter's long standing experience in timber trading
operations. The outlook may be revised to 'Positive' if the
company stabilises its operations earlier than expected, leading
to healthy accruals and improvement in its financial risk profile.
Conversely, the outlook may be revised to 'Negative' if HKL's
operating margin is lower than expected, or it undertakes a
substantial debt-funded expansion programme, or its working
capital management deteriorates, resulting in significant
weakening of its financial risk profile.
Established in 2014, HKL is a Gujarat based company engaged in
trading of timber. The firm will start commercial operations from
April 2015. Apart from trading, it would also undertake processing
of timber so as to cater to customized orders. The day to day
operations will be managed by Mr. Bharat Kumar Rudrani.
HULE CONSTRUCTIONS: CARE Reaffirms B+ Rating on INR9cr LT Loan
--------------------------------------------------------------
CARE reaffirms the ratings assigned to the bank facilities of
Hule Constructions Private Limited.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long term Bank Facilities 9 CARE B+ Reaffirmed
Short-term Bank Facilities 3 CARE A4 Reaffirmed
Rating Rationale
The ratings assigned to Hule Constructions Private Limited (HCPL)
continue to be constrained on account of its small scale of
operations in the competitive construction industry, the slowdown
in execution of existing projects, geographical & segmental
concentration of operations and stretched liquidity position of
the company. The ratings are also constrained by the decline in
the total operating income and volatile profitability margins.
The ratings, however, continue to draw support from the experience
of the promoter in the irrigation space, healthy order book
position and registration as class I-A contractor with the Public
Works Department (PWD) of Maharashtra state.
The ability of the company to execute the projects in time,
diversify its operations and enhance the scale of operations
while managing its liquidity position remain the key rating
sensitivities.
Incorporated in year 2007, HCPL is promoted by Mr Vishwanath Hule
Patil, having almost 25 years of experience in the infrastructure
space in the capacity of contractor. HCPL is engaged in
infrastructure contract work with operations focused in Beed
(Marathwada region) in Maharashtra. Within the infrastructure
sector HCPL majorly operates in two segments -- irrigation and
construction of buildings. The company participates in the tender
floated by the PWD; if awarded with the contract company has to
get design of the work certified from Central Design Organization
(Nasik). The company has successfully executed 11 projects on its
own and also owns most of the machinery and equipment which are
required for execution of projects.
The company got registered under the class I-A contractor in the
year 2011 with the PWD, Maharashtra state, and is eligible to
undertake all types of civil work, irrespective of size within the
state of Maharashtra.
During FY14 (refers to the period April 1 to March 31), HCPL
earned a PAT of INR0.15 crore on a total income of INR19.45
crore as against a PAT of INR1.39 crore on a total income of
INR42.44 crore for FY13.
KALYANESWARI UDYOG: CRISIL Suspends B Rating on INR56MM Loan
------------------------------------------------------------
CRISIL has suspended its ratings on the bank facilities of
Kalyaneswari Udyog Private Limited (KUPL).
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 34 CRISIL B/Stable Suspended
Letter Of Guarantee 3 CRISIL A4 Suspended
Term Loan 56 CRISIL B/Stable Suspended
The suspension of ratings is on account of non-cooperation by KUPL
with CRISIL's efforts to undertake a review of the ratings
outstanding. Despite repeated requests by CRISIL, KUPL is yet to
provide adequate information to enable CRISIL to assess KUPL's
ability to service its debt. The suspension reflects CRISIL's
inability to maintain a valid rating in the absence of adequate
information. CRISIL considers information availability risk as a
key credit factor in its rating process and non-sharing of
information as a first signal of possible credit distress, as
outlined in its criteria 'Information Availability Risk in Credit
Ratings'
KUPL, incorporated in 2010 by Kolkata based Agarwal family, is
engaged in the manufacturing of Polypropylene (PP) and High
Density Polyethylene (HDPE) woven sacks. KUPL has its
manufacturing facility at Kulti (West Bengal).
KUPL commenced commercial operations from January 2011. Mrs. Anita
Agarwal and Mrs. Puja Agarwal are the directors of KUPL. Mr. Vijay
Agarwal (husband of Mrs Anita Agarwal) and Mr. Rakesh Agarwal
(husband of Mrs. Puja Agarwal) oversee the day to day operations
of the company. The key personnel have extensive experience of
more than a decade in this business by virtue of their association
with other units in similar line of business.
LAKSHMI NARAYANA: CRISIL Suspends B Rating on INR80MM Cash Credit
-----------------------------------------------------------------
CRISIL has suspended its ratings on the bank facilities of
Lakshmi Narayana Enterprises (LNE).
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 80 CRISIL B/Stable Suspended
The suspension of ratings is on account of non-cooperation by LNE
with CRISIL's efforts to undertake a review of the ratings
outstanding. Despite repeated requests by CRISIL, LNE is yet to
provide adequate information to enable CRISIL to assess LNE's
ability to service its debt. The suspension reflects CRISIL's
inability to maintain a valid rating in the absence of adequate
information. CRISIL considers information availability risk as a
key credit factor in its rating process and non-sharing of
information as a first signal of possible credit distress, as
outlined in its criteria 'Information Availability Risk in Credit
Ratings'
LNE, established in 1987 as a proprietorship firm, is involved in
ginning and pressing of raw cotton (kapas). Its day-to-day
operations are managed by its proprietor, Mr. M Sambi Reddy.
M.G. AUTO: CRISIL Assigns B+ Rating to INR60MM Secured Loan
-----------------------------------------------------------
CRISIL has assigned its 'CRISIL B+/Stable' rating to the long-term
bank facilities of M.G. Auto Service (MGAS).
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Secured Overdraft Facility 60 CRISIL B+/Stable
The rating reflects MGAS's weak financial risk profile, marked by
a high total outside liabilities to tangible net worth ratio and
weak debt protection metrics, and low bargaining power with its
principal, Class India Private Limited. These rating weaknesses
are partially offset by its promoters' extensive experience in the
harvesters' distributorship business and its established market
position in Karnataka.
Outlook: Stable
CRISIL believes that MGAS will continue to benefit from its
promoters extensive industry experience. The outlook may be
revised to 'Positive' if MGAS's financial risk profile improves,
most likely driven by an increase in its scale of operations, and
improvement in its profitability, capital structure and debt
protection metrics. Conversely, the outlook may be revised to
'Negative' in case of decline in MGAS's revenues and
profitability, or if the company undertakes any large debt-funded
capital expenditure programme, thereby weakening its capital
structure.
Set up by Mr.Nagaraju, Mr.Surendra and their family, MGAS is an
authorised dealer of combine harvesters of Class India Private
Limited in Karnataka.
MGAS reported, a profit after tax (PAT) of INR1 million on net
sales of INR272 million for 2013-14 (refers to financial year,
April 1 to March 31); the company reported a PAT of INR3 million
on net sales of INR147 million for 2012-13.
NAG LEATHERS: CARE Reaffirms D Rating on INR6cr LT Bank Loan
------------------------------------------------------------
CARE reaffirms ratings assigned to bank facilities of NAG Leathers
Private Limited.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank Facilities 6 CARE D Reaffirmed
Short-term Bank Facilities 5 CARE D Reaffirmed
Rating Rationale
The ratings of Nag Leathers Private Limited (NLPL) continue to be
constrained by the ongoing delays in servicing the interest
obligations due to the tight liquidity position of the company
owing to funds blocked in the inventory.
NLPL was promoted by Mr S. Chockalingam Pillay (managing director)
and Mr K. Shanmugathammal (Director) in 1990, and later in 2003,
Mr C. Jagadeesh joined as a director of the company.
NLPL is engaged in the manufacturing of finished leather and shoe
uppers at its facility located at Ranipet. The installed capacity
at the unit is 36 lakh sq.ft of finished leather and 6 lakh pairs
of shoe uppers per annum. The major raw material raw hide leather
is procured from local suppliers and is converted to finished
leather and semi-finished leather as per the requirement. In FY14
(refers to the period April 1 to March 31), 32% of the total sales
was through export (Germany and Hong Kong) and the remaining 68%
was through domestic sales. The company earns 48% of its total
operating income through its sales to group companies.
NLPL has three group entities, namely, Nag Yang Shoes Private
Limited (NYSPL; rated 'CARE D'), Nag India Private Limited
and Sri Durga Leathers engaged in the leather shoes and shoe
uppers business. While NYSPL is engaged in the manufacturing of
leather shoes/footwear & uppers, the other two group companies are
engaged in the manufacturing of all types of shoe uppers. All the
companies offer operational support to each other as per
requirement. The Nag group also runs a trust by the name of Sree
Selva Vinayaga Charitable and Educational Trust (rated 'CARE D'),
which provides educational service.
NLPL has achieved a PAT of INR0.12 crore on a total operating
income of INR36.28 crore in FY14 as compared with PAT of INR0.14
crore on a total operating income of INR28.32 crore in FY13.
NAG YANG: CARE Reaffirms D Rating on INR12cr LT Bank Loan
---------------------------------------------------------
CARE reaffirms ratings assigned to bank facilities of Nag Yang
Shoes Private Limited.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank Facilities 12 CARE D Reaffirmed
Short-term Bank Facilities 8 CARE D Reaffirmed
Rating Rationale
The ratings of Nag Yang Shoes Private Limited (NYSPL) continue to
be constrained by the ongoing delays in servicing of the interest
obligations owing to the stressed liquidity position of the
company arising from significant funds locked up in the inventory.
NYSPL is a Vellore-based company incorporated in 2003 by Mr S. C.
Pillay, Mr K. Shanmugathammal and Mr C. Jagadeesh. The company
started its commercial operations from May 2003 by doing job work
for other factories and commenced manufacturing and exporting of
leather shoes and shoe uppers from August 2011. The company is
currently engaged in manufacturing of shoes/footwear & uppers
which are primarily exported (78% of the total sales in FY14
[refers to the period April 1 to March 31]) to European countries,
viz, Italy, UK and France.
The company has manufacturing capacity to produce 6 lakh pairs of
shoes per annum (as on March 31, 2014) at its manufacturing
facility located at Katpadi Taluk, Vellore. NYSPL is an ISO-
9001:2000 certified company and is also recognised export house by
Government of India.
The company manufactures its products against the orders received
and its products are retailed by reputed international clientele.
NYSPL procures raw materials (finished leather) from local market
and imports the leather components (buckles and other
accessories). Import constituted only 1.70% of the total purchases
for FY14.
NYSPL has three group entities, namely, Nag Leathers Private
Limited (NLPL; rated 'CARE D'), Nag India Private Limited and Sri
Durga Leathers engaged in the leather shoes and shoe uppers
business. While NLPL is engaged in the manufacturing of finished
leather and shoe uppers, the other two group companies are engaged
in the manufacturing of all types of shoe uppers. All the
companies offer operational support to each other as per
requirement. The Nag group also runs a trust by the name of Sree
Selva Vinayaga Charitable and Educational Trust (rated 'CARE D')
which provides educational service.
NYSPL reported net loss of INR0.49 crore on a total operating
income of INR31.40 crore in FY14 as compared with a PAT of
INR0.19 crore on a total operating income of INR28.95 crore in
FY13.
NATURAL SELECTIONS: CRISIL Assigns B+ Rating to INR23.5MM Loan
--------------------------------------------------------------
CRISIL has assigned 'CRISIL B+/Stable/CRISIL A4' ratings to the
bank facilities of Natural Selections (NS).
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Term Loan 23.5 CRISIL B+/Stable
Cash Credit 20 CRISIL B+/Stable
Letter of Credit 10 CRISIL A4
The ratings reflect NS's modest scale and working capital
intensive nature of operations and the susceptibility of its
operating margin to volatility in input prices. These rating
weaknesses are partially offset by the firm's moderate financial
risk profile, marked by low gearing and comfortable debt
protection metrics albeit a modest networth.
Outlook: Stable
CRISIL believes that NS will continue to benefit over the medium
term from its above average financial risk profile. The outlook
may be revised to 'Positive' if the firm reports a substantial
increase in its revenue, while sustaining its profitability and
comfortable capital structure. Conversely, the outlook may be
revised to 'Negative' in case of a significant decline in the
firm's revenue or profitability, adversely impacting its financial
risk profile.
NS, setup in 2012, is a partnership firm of Mr. Bhagwan Singh
Saini and his wife, Mrs. Gurmeet Kaur. The firm manufactures
injection-moulded plastic products such as meter parts, electric
switches, machine parts, and home appliance parts. Its
manufacturing facility is in Baddi (Himachal Pradesh).
NS reported net profit of INR7.85 million on net sales of INR112.2
million for 2013-14 (refers to financial year, April 1 to March
31), against a net profit of INR1.5 million on net sales of
INR32.2 million for 2012-13.
PARASRAM MANNULAL: CARE Revises Rating on INR5cr Loan to B+
-----------------------------------------------------------
CARE reaffirms the rating assigned to the bank facilities of
Parasram Mannulal Dall Mills Private Limited.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long term Bank Facilities 5 CARE B+ Revised from
CARE B
Rating Rationale
The rating assigned to the bank facilities of Parasram Mannulal
Dall Mills Private Limited (PMDM) was revised on account of the
increase in its scale of operations and improvement in its capital
structure, debt coverage indicators and liquidity position with
shortening of operating cycle during FY14 (refers to the period
April 1 to March 31).
The rating continues to remain constrained on account of its
modest scale of operations and its weak financial risk profile
characterised by thin profitability, leveraged capital structure
and weak debt coverage indicators. The rating further continues to
remain constrained on account of its presence in highly
competitive and fragmented agro processing industry and
vulnerability of its profit margins to commodity price
fluctuations.
The rating, however, continues to draw strength from the
experience of the promoters and financial support extended in
the form of unsecured loans.
The ability of PMDM to increase its scale of operations, improve
profitability and capital structure with efficient management of
the working capital are the key rating sensitivities.
Established as a proprietorship firm in 1968, PMDM is engaged in
the processing and trading of arhar dal (toor dal).
PMDM sells its product under the brand name PAPA, PM, Nari, Yellow
Gold and Gaay Bachda.
The company's plant is located at Katni, Madhya Pradesh, with an
installed capacity of 12,000 MTPA as on December 31, 2014, and
carries cleaning, splitting, grading and colour sorting
operations. The company procures raw material from local
market and other states such as Maharashtra, Karnataka through
various brokers and entire sales are also through network of
agents located at Madhya Pradesh, Maharashtra and Karnataka.
As per audited results for FY14, PMDM reported a PAT of INR0.22
crore on a TOI of INR75.71 crore as against PAT of INR0.12 crore
on a TOI of INR60.51 crore during FY13.
PRASAD SEEDS: CRISIL Assigns B+ Rating to INR45MM Cash Credit
-------------------------------------------------------------
CRISIL has assigned its 'CRISIL B+/Stable/CRISIL A4' ratings to
the bank facilities of Prasad Seeds Corporation (PSC).
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Bank Guarantee 55 CRISIL A4
Cash Credit 45 CRISIL B+/Stable
The ratings reflect PSC's small scale of operations in the
intensely competitive seeds processing industry. The ratings also
factor in the firm's below-average financial risk profile, marked
by high gearing and small net worth. These rating weaknesses are
partially offset by the extensive industry experience of PSC's
promoters.
Outlook: Stable
CRISIL believes that PSC will continue to benefit over the medium
term from its promoters' extensive industry experience. The
outlook may be revised to 'Positive' if the firm improves its
capital structure either by equity infusion or higher-than-
expected cash accruals, backed by improvement in its scale of
operations along with improvement in its working capital
management. Conversely, the outlook may be revised to 'Negative'
if PSC's financial risk profile deteriorates on account of further
decline in its revenue and profitability or in case of a larger-
than-expected debt-funded capital expenditure, or if the firm's
liquidity weakens significantly on account of increase in its
working capital requirements.
PSC was set up in 1998 as a proprietorship firm by Shahjahanpur
(Uttar Pradesh) based Mr. Saurabh Agarwal. It is engaged in
processing and selling of certified seeds such as wheat, paddy,
pulses, and oil seeds from raw seeds. Mr. Agarwal is the
proprietor of the firm and also manages the day-to-day operations
of the business.
PSC registered book profit of INR0.76 million on net sales of
INR181.53 million for 2013-14 (refers to financial year, April 1
to March 31) against book profit of INR0.86 million on net sales
of INR233.13 million for 2012-13.
PRASANTHI CASHEW: CRISIL Reaffirms B- Rating on INR300MM Loan
-------------------------------------------------------------
CRISIL's ratings on the bank loan facilities of Prasanthi Cashew
Company (PCC) continue to reflect PCC's below-average financial
risk profile, marked by a high total outside liabilities to
tangible net worth ratio. Moreover, its operating margin is
susceptible to volatility in cashew prices and to intense
competition in the cashew processing industry. These rating
weaknesses are partially offset by the extensive industry
experience of the firm's proprietor and its established market
position in processing and exporting cashew kernels.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Foreign Bill Purchase 50 CRISIL A4 (Reaffirmed)
Packing Credit 450 CRISIL A4 (Reaffirmed)
Packing Credit 300 CRISIL B-/Stable (Reaffirmed)
CRISIL had, on December 26, 2014, upgraded its ratings on PCC's
bank facilities to 'CRISIL B-/Stable/CRISIL A4' from 'CRISIL
D/CRISIL D'.
Outlook: Stable
CRISIL believes that PCC will continue to benefit over the medium
term from its proprietor's industry experience. The outlook may be
revised to 'Positive' if the firm's liquidity improves
significantly, with lower reliance on bank borrowings to fund its
working capital requirements. Conversely, the outlook may be
revised to 'Negative' in case of deterioration in PCC's working
capital management, or a significant decline in its cash accruals
because of lower revenue or operating profitability, leading to
weakening of its liquidity.
PCC, founded as a proprietorship firm by Mr. Mohan Chandra Nair in
Kerala in 1984, processes and exports cashew kernels.
PSM ENERGY: CRISIL Assigns B+ Rating to INR10MM LT Bank Loan
------------------------------------------------------------
CRISIL has assigned its 'CRISIL B+/Stable' rating to the long-term
bank facilities of PSM Energy Pvt Ltd (PSM).
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Proposed Long 10 CRISIL B+/Stable
Term Bank Loan
Facility
The rating reflects PSM's modest scale of operations with volatile
revenue, and its constrained financial flexibility owing to its
modest net worth. These rating weaknesses are partially offset by
the extensive experience of the company's promoters in the power
and mining consulting segment, and its healthy order book.
Outlook: Stable
CRISIL believes that PSM will continue to benefit over the medium
term from its promoters' extensive industry experience and its
healthy order book. The outlook may be revised to 'Positive' in
case of a significant and sustained increase in the company's
revenue and profitability along with substantial capital infusion.
Conversely, the outlook may be revised to 'Negative' if PSM's cash
accruals are lower than expected, or if there are delays in
execution of its order book or sustained pressure on its revenue
growth and/or profitability.
PSM, incorporated in 2010, is based in Gurgaon (Haryana) and is
promoted by Mr. Saurabh Prakash and Mr. Mukesh Kumar. The company
provides consulting services to private and government
organisations in the power and mining sectors.
R.V.M EDUCATION: CRISIL Suspends D Rating on INR200MM Term Loan
---------------------------------------------------------------
CRISIL has suspended its ratings on the bank facilities of R.V.M
Education Pvt Ltd (REPL).
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Term Loan 200 CRISIL D Suspended
The suspension of ratings is on account of non-cooperation by REPL
with CRISIL's efforts to undertake a review of the ratings
outstanding. Despite repeated requests by CRISIL, REPL is yet to
provide adequate information to enable CRISIL to assess REPL's
ability to service its debt. The suspension reflects CRISIL's
inability to maintain a valid rating in the absence of adequate
information. CRISIL considers information availability risk as a
key credit factor in its rating process and non-sharing of
information as a first signal of possible credit distress, as
outlined in its criteria 'Information Availability Risk in Credit
Ratings'
REPL was set up in 2011 by Mr. Lokvesh Magu. The company is
currently undertaking a project to establish a school named Manav
Rachna International School in Noida (Uttar Pradesh) under the
franchise with Manav Rachna Group. The school will offer pre-
primary, primary, and secondary education up to the higher
secondary level; it has enrolled 78 students for the 2013-14
academic year.
RAGHAW FASHIONS: CRISIL Assigns B+ Rating to INR30MM Cash Credit
----------------------------------------------------------------
CRISIL has assigned its 'CRISIL B+/Stable' rating to the long-term
bank facility of Raghaw Fashions Pvt Ltd (RFPL).
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 30 CRISIL B+/Stable
Term Loan 21.5 CRISIL B+/Stable
The rating reflects the company's modest scale of operations in
the intensely competitive textile industry, coupled with working-
capital-intensive operations. These rating weaknesses are
partially offset by the extensive experience of the promoters in
the textile industry and their established relationship with
customers and suppliers.
Outlook: Stable
CRISIL believes that RFPL will continue to benefit over the medium
term from its promoters' extensive industry experience and their
established relationship with customers. The outlook may be
revised to 'Positive' if the company generates higher-than-
expected cash accruals or benefits from the significant equity
infusion by its promoters, leading to improvement in its financial
risk profile. Conversely, the outlook may be revised to 'Negative'
if there is a significant decline in RFPL's cash accruals or
deterioration in its working capital management, or if it
undertakes a large debt-funded capital expenditure programme,
further weakening its financial risk profile, particularly
liquidity.
Established in 2004, RFPL undertakes the job work of dyeing and
printing of fabrics. The company was promoted by Mr. Bhagirath
Panpaliya with capacity of processing 90,000 meters per day of
fabrics. The company is based in Surat (Gujarat).
S. R. COTTON: CRISIL Reaffirms B+ Rating on INR75MM Cash Loan
-------------------------------------------------------------
CRISIL's rating on the long-term bank facilities of S. R. Cotton
(SRC) continues to reflect SRC's weak financial risk profile,
marked by a small net worth, high gearing, and weak debt
protection metrics.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 75 CRISIL B+/Stable (Reaffirmed)
Term Loan 25 CRISIL B+/Stable (Reaffirmed)
The rating also factors in the firm's exposure to regulatory risks
and to volatility in cotton input prices. These rating weaknesses
are partially offset by the extensive experience of SRC's
proprietor in the cotton ginning industry, and the financial
support that it receives from him and his associates in the form
of interest-bearing unsecured loans.
Outlook: Stable
CRISIL believes that SRC will continue to benefit over the medium
term from its proprietor's extensive industry experience. The
outlook may be revised to 'Positive' if the firm's financial risk
profile improves, most likely driven by improved working capital
management and profitability, or capital infusion. Conversely, the
outlook may be revised to 'Negative' in case of deterioration in
SRC's liquidity, resulting from large working capital requirements
or substantially reduced cash accruals.
SRC was set up in 2006 as a proprietorship firm by Mr. Vinit
Tayal. The firm is engaged in cotton ginning and pressing at its
two units in Beed (Maharashtra) and Sendhwa (Madhya Pradesh).
SARASWATI EDUCATION: CRISIL Cuts Rating on INR960MM Loan to D
-------------------------------------------------------------
CRISIL has downgraded its rating on the long-term bank facilities
of Saraswati Education Society (SES) to 'CRISIL D' from 'CRISIL
BB-/Stable'.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 160 CRISIL D (Downgraded from
'CRISIL BB-/Stable')
Term Loan 960 CRISIL D (Downgraded from
'CRISIL BB-/Stable')
The rating downgrade follows instances of delay by SES in
servicing its term debt; the delays have been caused by the
society's weak liquidity, driven by delayed receipt of subsidies
and student fees.
SES is also exposed to risks related to regulatory changes and
high working capital requirements. However, the society benefits
from its diverse course offerings.
SES was set up in October 2003 by Dr. Nandkumar Yadavrao
Tasgaonkar to establish and manage technical and other educational
institutions in Maharashtra. It is registered under the Societies
Registration Act and the Indian Trusts Act.
SHRI RENUGA: CARE Lowers Rating on INR252.65cr LT Loan to D
-----------------------------------------------------------
CARE revises ratings assigned to bank facilities of Shri Renuga
Textiles Limited.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank Facilities 252.65 CARE D Revised from
CARE C
Short-term Bank Facilities 12.00 CARE D Revised from
CARE A4
Rating Rationale
The revision of the ratings takes into account the ongoing delays
in debt servicing of the bank debt obligations by Shri Renuga
Textiles Limited (SRTL).
SRTL is the flagship company of the Shri Renuga Industrial group
companies operating in Theni, Tamil Nadu. SRTL is engaged in the
production of yarn, terry towel-related products, yarn dyeing and
fabric processing & dyeing. As on March 31, 2013, the company had
a capacity of 63,976 spindles, 106 weaving looms, terry towel
processing capacity of 62.60 lakh kg per annum and yarn dyeing
capacity of 2,000 kg of yarn per day spread among three
manufacturing units. SRTL also has two 4.5 MW biomass plants.
During FY13 (refers to the period April 1 to March 31), the
company incurred a loss of INR27 crore on total income of INR231
crore. In 6MFY14 (as per provisional results), the company
generated a total income of INR161 crore and incurred loss of
INR15 crore.
SKS FASTENERS: CRISIL Suspends B+ Rating on INR95MM Cash Credit
---------------------------------------------------------------
CRISIL has suspended its ratings on the bank facilities of SKS
Fasteners Ltd (SKS).
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Bank Guarantee 5 CRISIL A4 Suspended
Cash Credit 95 CRISIL B+/Stable Suspended
Letter of Credit 80 CRISIL A4 Suspended
Term Loan 71.1 CRISIL B+/Stable Suspended
The suspension of ratings is on account of non-cooperation by SKS
with CRISIL's efforts to undertake a review of the ratings
outstanding. Despite repeated requests by CRISIL, SKS is yet to
provide adequate information to enable CRISIL to assess SKS's
ability to service its debt. The suspension reflects CRISIL's
inability to maintain a valid rating in the absence of adequate
information. CRISIL considers information availability risk as a
key credit factor in its rating process and non-sharing of
information as a first signal of possible credit distress, as
outlined in its criteria 'Information Availability Risk in Credit
Ratings'
SKS was originally incorporated in 1996 in Pune (Maharashtra),
promoted by the Bindal family. It was reconstituted as a closely
held public limited company in 1997. SKS manufactures fasteners
(bolts) and mainly supplies its products to players in the
automobile industry.
SPRL FOODS: CARE Reaffirms B+ Rating on INR31.12cr LT Loan
----------------------------------------------------------
CARE reaffirms ratings assigned to bank facilities of SPRL Foods
Limited.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long term Bank Facilities 31.12 CARE B+ Reaffirmed
Rating Rationale
The rating assigned to the bank facilities of SPRL Foods Limited
(SFL) continues to remain constrained by its small scale and
limited track record of operations, weak financial risk profile
characterized by low profitability margins, leveraged capital
structure, weak coverage indicators and working capital intensive
nature of operations. The ratings are further constrained by
susceptibility of SFL to volatility in raw material prices and
highly fragmented nature of the industry with low entry barriers.
The rating, however continues to favorably take into account the
experienced promoters in the agro processing industry.
Going forward, the ability of the company to profitably scale up
its operations and improvement in the capital structure shall be
the key rating sensitivities.
Incorporated in 2011, SPRL Foods Limited (SFL) is a closely held
public limited company promoted by by Mr Shiv Poojan Kesarwani, Mr
Satish Kumar, Mr Ashish Kumar and Mr Manish Kumar. The company is
engaged in the processing of wheat into wheat flour, maida and
suji and started its commercial operations in January 2013. The
company also started commercial operations of its paddy processing
unit in May 2013. The processing units are located in Allahabad
(wheat processing) and Chanderpur (paddy processing), Uttar
Pradesh with an installed capacity of 50,400 Metric Tonnes Per
Annum (MTPA) and 115,200 MTPA respectively. The company procures
raw material comprising wheat and paddy from farmers and local
traders and sells its products domestically to companies like ITC
Limited, Parle Agro Pvt Ltd, Ravi Foods Private Limited as well as
into the local market. SFL generated revenue of 45.01% from sale
of rice and 55.32% from the sale of wheat in FY14 (refers to the
period April 1 to March 31). The group companies of SFL include
L.C. Foods Limited and S.P. Sortex Rice Exports India Private
Limited engaged in the similar lines of activities.
SFL reported a PAT of INR(1.62) crore on a total income of
INR53.48 crore in FY14. SFL has achieved a total operating income
of INR73.14 crore till December 31, 2014.
SVS HOSPITALS: CRISIL Assigns B Rating to INR72MM LT Loan
---------------------------------------------------------
CRISIL has assigned its 'CRISIL B/Stable' rating to the long-term
bank facilities of SVS Hospitals Pvt Ltd (SVS).
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Long Term Loan 72 CRISIL B/Stable
The rating reflects SVS's exposure to risks related to on-going
hospital project and exposure to risks related to stabilisation
during initial stages of operations. These rating weaknesses are
partially offset by the benefits that the company derives from its
promoters' extensive experience in health care industry and
strategic location of the hospital.
Outlook: Stable
CRISIL believes that SVS will maintain a stable credit risk
profile on the back of promoter's extensive experience. The
outlook may be revised to 'Positive' in case of timely execution
of the project within the projected cost or in case of higher than
expected occupancy levels and profitability; resulting in higher
than expected accruals and thus better financial risk profile.
Conversely, the outlook may be revised to 'Negative' in case of
any time or cost overrun which would adversely impact the
financial risk profile of the company and thus its debt-servicing
ability.
Incorporated in the year 2006, SVS is setting up a 150-bed Neuro
specialty hospital in Hyderabad. Promoted by Dr. D Sreedhar and
his associates, the hospital is expected to start commercial
operations from May 2015.
T. ASOKAN: CRISIL Assigns B+ Rating to INR50MM Cash Credit
----------------------------------------------------------
CRISIL has assigned its 'CRISIL B+/Stable/CRISIL A4' ratings to
the bank facilities of T. ASOKAN (TA).
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Proposed Working
Capital Facility 40 CRISIL B+/Stable
Bank Guarantee 30 CRISIL A4
Cash Credit 50 CRISIL B+/Stable
The ratings reflect TA's modest scale of operations in the
intensely competitive civil construction segment, and its below-
average financial risk profile. These rating weaknesses are
partially offset by the extensive industry experience of the
firm's promoters.
Outlook: Stable
CRISIL believes that TA will continue to benefit over the medium
term from its promoters' industry experience. The outlook may be
revised to 'Positive' if the firm significantly scales up its
operations while maintaining its operating profitability, or
improves its working capital management, resulting in a better
financial risk profile. Conversely, the outlook may be revised to
'Negative' if TA's accruals decline or if its working capital
management weakens, leading to deterioration in its financial risk
profile, especially its liquidity.
TA is a Calicut (Kerala)-based civil contractor. Its operations
are managed by its proprietor, Mr. T Asokan.
For 2013-14 (refers to financial year, April 1 to March 31), TA
reported a net profit of INR2.22 million on gross bill receipts of
INR73.88 million, against a net profit of INR3.65 million on gross
bill receipts of INR59.57 million for 2012-13.
TRIVENI SHIP: CRISIL Cuts Rating on INR50MM Cash Loan to B+
-----------------------------------------------------------
CRISIL has downgraded its ratings on the bank facilities of
Triveni Ship Breakers (Triveni) to 'CRISIL B+/Stable/CRISIL A4'
from 'CRISIL BB-/Stable/CRISIL A4+'.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 50 CRISIL B+/Stable (Downgraded
from 'CRISIL BB-/Stable')
Letter of Credit 440 CRISIL A4 (Downgraded from
'CRISIL A4+')
Proposed Long Term 9.8 CRISIL B+/Stable (Downgraded
Bank Loan Facility from 'CRISIL BB-/Stable')
The rating downgrade reflects CRISIL's belief that Triveni's
business risk profile will remain under pressure over the medium
term on account of the slowdown in ship-breaking activity. The
firm's revenue declined to INR199 million in 2013-14 (refers to
financial year, April 1 to March 31) from INR657 million in 2011-
12; its operating margin too declined to 1.5 per cent from 5.8 per
cent over this period. Triveni has not purchased any ship in 2014-
15 on account of volatility in prices, and is expected to close
the year with sales of less than INR300 million. However, the firm
benefits from its management's cautious approach and its sizeable
fixed deposit balance.
The ratings reflect Triveni's small scale of operations and
susceptibility to volatility in foreign exchange (forex) rates and
steel prices. These rating weaknesses are partially offset by the
extensive experience of the firm's promoters in the ship-breaking
industry.
Outlook: Stable
CRISIL believes that Triveni will continue to benefit over the
medium term from its promoters' extensive industry experience. The
outlook may be revised to 'Positive' if the firm reports
substantial growth in its topline and improvement in its
profitability, backed by an increase in ship-breaking activity.
Conversely, the outlook may be revised to 'Negative' if Triveni's
liquidity weakens because of any adverse movement in steel scrap
prices, resulting in its inability to recover the cost of ship
purchase, or unfavourable movements in forex rates, leading to
substantial losses.
Triveni was established in 1983 by Mr. Yogesh Kanakiya and his
brother Mr. Nitin Kanakiya in Bhavnagar (Gujarat). The firm is
engaged in ship-breaking activities in Alang (Gujarat). It has a
capacity to break various types of ships, such as general cargo
ships, oil tankers, reefers, and bulk carriers.
For 2013-14, Triveni reported a net profit of INR3.9 million on
net sales of INR199 million, against a net profit of INR8.4
million on net sales of INR609.7 million for 2012-13.
VICTORA AUTO: CRISIL Suspends B Rating on INR40MM LT Bank Loan
--------------------------------------------------------------
CRISIL has suspended its ratings on the bank facilities of Victora
Auto Parts Pvt Ltd (VAPPL).
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Bill Purchase- 300 CRISIL A4 Suspended
Discounting
Facility
Letter of Credit 60 CRISIL A4 Suspended
Packing Credit 50 CRISIL A4 Suspended
Proposed Long Term
Bank Loan Facility 40 CRISIL B/Stable Suspended
The suspension of ratings is on account of non-cooperation by
VAPPL with CRISIL's efforts to undertake a review of the ratings
outstanding. Despite repeated requests by CRISIL, VAPPL is yet to
provide adequate information to enable CRISIL to assess VAPPL's
ability to service its debt. The suspension reflects CRISIL's
inability to maintain a valid rating in the absence of adequate
information. CRISIL considers information availability risk as a
key credit factor in its rating process and non-sharing of
information as a first signal of possible credit distress, as
outlined in its criteria 'Information Availability Risk in Credit
Ratings'
VAPPL, incorporated in 2003, is promoted by Mr. Hardeep Singh
Banga and his brother, Mr. Satinder Singh Banga. Its manufacturing
unit is in Sector 25, Faridabad (Haryana). The company
manufactures exhaust system hangers for passenger cars. It is a
Tier-II supplier; it supplies to Tier-I auto components
manufacturers, who in turn supply to auto original equipment
manufacturers.
ZENOVA BIO: CRISIL Reaffirms D Rating on INR66MM Long Term Loan
---------------------------------------------------------------
CRISIL's rating on the bank facilities of Zenova Bio Nutrition Pvt
Ltd (ZBNPL) continues to reflect instances of delay by ZBNPL in
servicing its debt obligations owing to weak liquidity on account
of delay in commencement of its project. The company's financial
risk profile is also weak, marked by high gearing and weak debt
protection metrics. However, ZBNPL benefits from its promoters'
extensive industry experience.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 30 CRISIL D (Reaffirmed)
Long Term Loan 66 CRISIL D (Reaffirmed)
ZBNPL was incorporated in April 2010 by Mr. K V Rambabu and Mr.
Yeshwant Rege. Mr. Rege has resigned, and Mr. C Sarat Chandra has
joined as a stake holder as well as a director. The company has
set up a plant to manufacture medicinal nutraceutical products in
the form of powder as well as compressed discuits. The trial runs
are going on and the company is expected to achieve a turnover of
INR10 million 2014-15 (refers to financial year, April 1 to
March 31).
=================
I N D O N E S I A
=================
LIPPO KARAWACI: S&P Affirms 'BB-' CCR; Outlook Stable
-----------------------------------------------------
Standard & Poor's Ratings Services said that it had affirmed its
'BB-' long-term corporate credit rating on Indonesia-based
property developer PT Lippo Karawaci Tbk. (Lippo). The outlook is
stable. At the same time, S&P affirmed its 'axBB+' long-term
ASEAN regional scale rating on the company. S&P also affirmed its
'BB-' long-term issue rating on the company's guaranteed senior
unsecured notes.
"We affirmed the ratings because we expect Lippo to maintain its
strong market position in the property development business in
Indonesia over the next 12 months," said Standard & Poor's credit
analyst Kah Ling Chan.
S&P anticipates that the company will continue to aggressively
expand its operations, especially the construction of new
hospitals and retail malls. The company's property sales are
likely to steadily rise on the back of increased launches,
especially apartment sales in its large integrated developments.
Lippo also has greater financial flexibility than its peers, in
S&P's view, because it believes the company can dispose of
stabilized assets such as hospitals and retail malls to its listed
REITs.
Substantial recurring income from hospitals, malls, and asset
management, in additional to property sales, underpins Lippo's
"fair" business risk profile. S&P expects recurring income to
account for at least 35%-40% of Lippo's total EBITDA (excluding
asset sales) for the next two years, although this proportion can
be lower during years of material asset sales to the REITS. In
S&P's view, Lippo's higher recurring income than peers' adds
stability to its profitability.
S&P expects Lippo's sales from its real estate development
operations to be steady over the next 18 months. S&P estimates
that Lippo's revenue will decrease 11% to Indonesian rupiah (IDR)
10.3 trillion in 2015 and increase 86% to IDR19.2 trillion in
2016. S&P believes the company has some rating buffer, albeit
significantly diminished, even if the proposed asset disposals do
not materialize.
Lippo's EBITDA margins are likely to remain above 35% in 2015 and
2016 on the back of improved property sales as well as disposal of
shopping malls to a sponsored REIT, Lippo Malls Retail Indonesia
Trust.
"We expect Lippo's capital spending to remain high over the next
two years at least as the company continues to add more hospitals
and retail malls," said Ms. Chan. "Lippo's operating cash flows,
cash balance, and proceeds from the sale of Kemang Village Retail
Mall should be sufficient to fund its investments, with no
recourse to additional debt."
S&P continues to view Lippo's significant debt appetite and
substantial capital expenditure as an indication of the company's
high risk tolerance, which constrains the financial risk profile.
S&P expects Lippo's cash flows to be somewhat volatile through an
industry cycle. S&P notes that the timing of asset sales to
Lippo's sponsored REITS will influence the company's operating
performance and cash flow adequacy in a given year.
Lippo's stakes in listed REITs in Singapore and healthcare
operator PT Siloam International Hospitals Tbk. support its
financial flexibility and capital structure. The stakes also
offset the mismatch between Lippo's cash flows denominated in
Indonesian rupiah and financial debt denominated in U.S.
dollar.
The stable outlook reflects S&P's expectation that Lippo will
benefit from strong sales growth in the property development
business. Low penetration of medical services in Indonesia should
also continue to drive the expansion and performance of the
company's hospitals portfolio. The outlook also factors S&P's
expectation that Lippo will continue to dispose of matured assets
to fund capital expenditure and moderate the increase in leverage.
S&P believes Lippo's buffer under S&P's downgrade trigger has
reduced, leaving limited scope for the company to increase debt.
S&P could lower the rating if Lippo's leverage and cash flows
deteriorate, such that the ratio of EBITDA to interest is less
than 2x or the debt-to-EBITDA ratio is more than 5x on a sustained
basis. This may occur if: (1) a significant slowdown in
Indonesia's economy or a sharp increase in domestic interest rates
reduces the demand for properties and healthcare services; (2)
Lippo's execution of its property and hospital development
projects is slower than S&P expects; (3) the company's asset sales
prospects are curtailed; or (4) Lippo's financial policies become
more aggressive, with an increase in debt-funded expansion.
Potential upside to the rating is limited for the next 12 months
because of Lippo's large capital spending and increased debt
funding for expansion. However, S&P could upgrade Lippo if the
company adopts a more conservative financial policy while pursuing
its growth strategy, and its recurring stable cash flows from non-
property business segments increases, leading to an improved
financial risk profile.
=========
J A P A N
=========
SHARP CORP: May Post JPY200BB Loss for FY2014, Close Plants
-----------------------------------------------------------
The Japan Times reports that Sharp Corp. is expected to post a
group net loss of about JPY200 billion this fiscal year and is
considering additional restructuring, including the closure of
four factories in Hiroshima Prefecture, sources close to the
matter said on March 3.
According to the report, the sources said the struggling
electronics-maker at the same time aims to strengthen its
financial condition by requesting aid from two main creditor banks
to increase its capital by around JPY175 billion through measures
such as a debt-for-equity swap.
The Japan Times says the expected loss will be far bigger than the
JPY30 billion loss that the company currently expects for the
fiscal year ending this month and will represent a plunge from a
profit of JPY11.6 billion it posted in the last fiscal year that
ended in March 2014.
In a bid to restore its battered operations, Sharp is considering
closing its Mihara plant, which mainly produces light-emitting
diodes, and its Fukuyama No. 1 to No. 3 plants for sensor-related
products such as touch panels, the sources, as cited by The Japan
Times, said.
The Japan Times relates that the sources said the Osaka-based
company also plans to pull out of production and sales of its
unprofitable solar panel business, as the yen's rapid depreciation
has driven up the cost of imported components.
The sources said Sharp will seek financial support of
JPY75 billion each from Mizuho Bank and the Bank of Tokyo-
Mitsubishi UFJ through a debt-for-equity swap, while it is looking
to raise JPY25 billion via a third-party allocation of shares with
domestic and overseas companies, according to the report.
The Japan Times notes that the electronics-maker managed to return
to profitability for the first time in three years in the last
fiscal year, as it shifted its focus to small-to-medium display
panels for smartphones and its efforts to revamp its flagging TV
and liquid crystal display panel businesses also paid off.
But the company is now facing intensifying competition with
Chinese and South Korean rivals that are attracting customers away
from it with their lower-cost display panels, the report relates.
Sharp posted a group net loss of JPY545.3 billion in the fiscal
year ended March 2013 that followed a net loss of JPY376.1 billion
in the previous year, the report discloses.
The company said later in a statement on March 3 that it is
considering a variety of restructuring measures and will outline
its new mid-term business plan in May, The Japan Times adds.
About Sharp Corp.
Based in Osaka, Japan, Sharp Corporation (TYO:6753) --
http://sharp-world.com/-- manufactures and sells electronic
telecommunication devices, electronic machines and components.
As reported in the Troubled Company Reporter-Asia Pacific on
Feb. 6, 2015, Standard & Poor's Ratings Services said that it has
placed its 'B+' long-term corporate credit and 'B' issue ratings
on Sharp Corp. on CreditWatch with negative implications. At the
same time, S&P affirmed the 'B' short-term corporate and CP
program rating on the company. S&P also placed the 'B+' long-term
corporate credit rating on its overseas subsidiary, Sharp
International Finance (U.K.) PLC, on CreditWatch with negative
implications. S&P affirmed its 'B' short-term corporate and CP
program rating on the company.
SHARP CORP: S&P Lowers CCR to CCC+ & Remains on CreditWatch Neg.
----------------------------------------------------------------
Standard & Poor's Ratings Services said it has lowered its long-
term corporate credit and debt ratings on Japan-based electronics
company Sharp Corp. to 'CCC+'. The ratings remain on CreditWatch
with negative implications. S&P lowered its short-term corporate
credit and commercial paper program ratings on Sharp to 'C' and
placed them on CreditWatch with negative implications. S&P also
lowered its long-term corporate credit rating on Sharp's overseas
subsidiary Sharp International Finance (U.K.) PLC to 'CCC+' and
kept it on CreditWatch with negative implications. S&P lowered
its short-term corporate credit and commercial paper program
ratings on Sharp International Finance to 'C' and placed the
ratings on CreditWatch with negative implications. On Feb. 4,
2015, S&P placed the long-term ratings on Sharp and its subsidiary
on CreditWatch with negative implications following Sharp's
announcement of a steep cut in forecast earnings.
The downgrades and CreditWatch placements reflect S&P's view that
Sharp is more likely than previously to ask its main lender banks
for support in a form S&P defines as 'SD' (selective default),
such as a debt-for-equity swap, modifications to existing debt, or
a debt waiver. S&P may further lower its ratings on Sharp by more
than one notch if in the next few months S&P sees a greater
likelihood of lender bank support in a form it deems as 'SD'.
S&P's ratings on Sharp have heavily reflected support from its
main lender banks on the basis of S&P's analysis of the company's
financial profile and liquidity. Sharp plans to ask its main
lender banks for a debt-for-equity swap, according to a media
report. S&P believes financial market conditions for Sharp may
deteriorate further, because credit default swaps have widened
owing to the company's worsening business performance. As a
result, S&P sees a greater likelihood of Sharp approaching its
main lender banks for support in a form S&P defines as 'SD', such
as a debt-for-equity swap, modifications to existing debt, or a
debt waiver.
S&P will review the ratings and resolve the CreditWatch placement
after examining Sharp's earnings prospects and the support of its
lender banks. S&P may further lower its ratings on Sharp more
than a notch if in the next few months S&P sees a greater
likelihood of lender banks extending support in a form that S&P
defines as 'SD'.
Prior to the downgrade, S&P's long-term debt rating on Sharp was a
notch lower than the long-term corporate credit rating because the
ratio of the company's priority liabilities to total assets is
about 25%, exceeding our 15% threshold to notch them down.
Following the downgrade, however, the 'CCC+' long-term debt rating
is the same as the long-term corporate credit rating because S&P
believes Sharp's main lender banks will extend support in a form
S&P defines as 'SD', in which case Sharp is likely to fulfill its
obligations to bondholders over its lenders. At the same time,
credit default swaps have widened, leading S&P to believe Sharp
may have an increasing incentive to undergo a debt exchange. If
the corporate credit rating is 'B-' or lower, S&P would ordinarily
view a debt exchange as a de facto restructuring and would lower
the affected rating to 'D' upon completion of the exchange S&P
viewed as distressed.
===============
M O N G O L I A
===============
STATE BANK: Moody's Rates Global LC Long-term Deposit at 'B2'
-------------------------------------------------------------
Moody's Investors Service assigned first-time ratings to State
Bank LLC; namely a global local currency long-term deposit rating
of B2, a foreign currency long-term deposit rating of B3, and a
bank financial strength rating (BFSR) of E+.
The outlook for all the ratings is negative.
Moody's points out that State Bank's BFSR of E+, is equivalent to
a baseline credit assessment (BCA) of b3.
"State Bank's BFSR reflects firstly, the bank's solid franchise in
Mongolia, which results in a less concentrated loan book when
compared with its domestic peers, and secondly, its capitalization
and liquidity levels, which are stronger than those of its
similarly rated domestic peers, and which therefore support its
BCA," says Hyun Hee Park, a Moody's Assistant Vice President and
Analyst.
"On the other hand, State Bank's strengths are offset by its
limited track record of asset quality, as well as its lower but
improving profitability when compared with its domestic peers.
These factors have also been taken into account in our assessment
of its BCA," adds Park.
State Bank's local currency long-term deposit rating of B2
incorporates a one-notch uplift from its BCA of b3, based on
Moody's assessment of systemic support.
Moody's says the high probability of support from the Government
of Mongolia (B2 negative) to the bank is underpinned by the bank's
ownership by the government as well as by the bank's systemically
important position as the fourth-largest bank in the country by
assets.
The key drivers of State Bank's ratings are:
(1) The bank's solid franchise; namely its strong retail
footprint in Mongolia, given its position as the country's
fourth-largest commercial bank by assets.
(2) Its strong capital position. The bank's Tier 1 ratio of
13.1% at June 30, 2014 was the strongest in Mongolia's
banking system.
(3) Its limited track record of maintaining good asset quality,
given that it received Savings Bank's good assets less than
18 months' ago, in July 2013. In addition, the bank has not
established a track record of maintaining its asset quality
through economic cycles. Nevertheless, Moody's notes that
State Bank's asset quality is sound, driven by its granular
loan book.
(4) Its low loan-to-deposit ratio. The ratio was at 88.6% at
end-June 2014, a result which was low when compared to the
system average of 100.8% in the same period.
Upward pressure on State Bank's B2 local currency deposit rating
is unlikely, unless the sovereign rating is upgraded, because the
bank's B2 local currency deposit rating is at the same rating
level as the sovereign rating.
Moody's would consider raising State Bank's BCA of b3 if the bank
demonstrates a track record of stable asset quality over the next
4-6 quarters, while improving profitability and maintaining
capital and liquidity levels.
The following factors could exert downward pressure on State
Bank's ratings: (1) a significant deterioration in asset quality,
for example new non-performing loans to gross loans exceeding
4.0%; (2) an increase in concentration or exposure to risky
sectors, particularly construction; (3) a Tier 1 ratio falling
below 9%; or (4) if profitability deteriorates significantly, such
that net income falls below 1.0% of average risk weighted assets.
The principal methodology used in this rating was Global Banks
published in July 2014.
State Bank LLC is based in Ulaanbaatar. It is the fourth-largest
bank in Mongolia by assets. The bank's assets totaled MNT1.9
trillion at end-June 2014.
State Bank is 24.78% owned by Mongolia's Ministry of Finance.
While the bank is 75.22% owned by the Deposit Insurance
Corporation, the majority shareholder does not hold any voting
rights.
====================
N E W Z E A L A N D
====================
CONCEPT HOMES: In Administration, Owes More Than NZ$1MM
-------------------------------------------------------
The Dominion Post reports that a Waikato company has gone into
liquidation owing more than NZ$1 million to 70 businesses.
Concept Homes Tokoroa was placed into liquidation last month by
sole director and shareholder, Vincent Ian Randall, according to
The Dominion.
The report notes that liquidator Kim Thompson said Concept Homes
Tokoroa owned three properties at the development. Including
other work, the liquidation would leave two homeowners with mostly
complete houses, two homeowners with incomplete houses, and one
without any work done, the report relays.
The report says that Mr. Thompson's first liquidator's report said
the business was "hard hit by the recession".
It borrowed funds to prop up the business, "however the losses
were not able to be covered by current or future work," the report
notes.
The Dominion Post relays that Mr. Thompson's report said the
company had about $195,000 in assets available to pay off debts,
leaving a huge shortfall for the 70 secured, preferential and
unsecured creditors.
The report notes that Mr. Thompson said it appeared Randall had
personal assets he was able to borrow against to keep putting
money into the company.
"At the end of the day the biggest creditor is the bank," the
report quoted Mr. Thompson as saying.
However, the report notes that Mr. Thompson confirmed there were
"substantial debts" to other companies.
Mr. Thompson's report also lists a DM Randall as a secured
creditor. Mr. Thompson confirmed this was Randall's wife, but
said the couple probably wouldn't be getting any money as Randall
was "likely to go bankrupt given the likely pressure from
creditors," the report notes.
"There won't be any money that goes to him, I can assure you," Mr.
Thompson added.
A debt search on Randall showed a debt to Yes Finance Ltd with
Concept Homes Tokoroa listed as the debtor, and six cars used as
collateral including a Holden Commodore, Toyota Hilux and Toyota
Hiace, the report notes. A Rayglass Cruisemaster 550 boat and
boat trailer were also included as collateral until December, the
report relays.
The report notes that Mr. Thompson confirmed Mr. Randall also had
a "substantial house at Tokoroa, but he has got huge borrowings on
it".
The report notes that Mr. Randall said the bank had taken his
house, the boat had been sold to meet company debts, and the
couple were looking for a rental house at present.
Mr. Randall is listed as having gone bankrupt in 1997 by
gazette.govt.nz, where his job description is builder/farmer.
Concept Homes Tokoroa, advertised on its website as a "complete
design and build specialist" company serving the Waikato, was
placed into liquidation last month by sole director and
shareholder, Vincent Ian Randall.
EHOME NZ: To Finish Building Houses While in Receivership
---------------------------------------------------------
The New Zealand Herald reports that eHome NZ, the country's
biggest off-site house manufacturer, now in receivership, is
finishing the work it started at New Zealand's most advanced
special housing area.
Brian Donnelly, executive director of the New Zealand Housing
Foundation, said eHome NZ had 11 houses under construction at the
Waimahia Inlet when it was put into receivership last month.
"Of those, three are fully completed and work is carrying on at
the other eight which should be complete over the next eight
weeks," the report quoted Mr. Donnelly as saying.
"It's frustrating and the receivership came as a surprise to me.
But it hasn't had any real impact at all. We moved very quickly
to get places finished," Mr. Donnelly said, the report notes.
Only a few days were lost in building time.
The foundation is working with other parties to build 282 new
houses at Weymouth on the edge of the Manukau Harbour and eHome
was one of three builders at that site, along with Goodwin
Building Services and Goldsmith Developments, the report relays.
However, Mr. Donnelly said sale prices had risen. Initially,
houses sold from NZ$322,000 to NZ$495,000, the report notes.
"But for stage two, it's more NZ$342,000 to NZ$520,000. They're up
because the market is moving and costs are moving as well," Mr.
Donnelly said, referring to the price of labor, construction
materials, fees, compliance costs and consultancy fees, the report
discloses.
As for whether Waimahia would continue to work with eHome once
receivers sell it, Donnelly said that was undecided, the report
says.
"We'll look to see what's possible," Mr. Donnelly said. "There
are not contracts with eHome to complete more. We've been focused
on getting the houses under way completed," Mr. Donnelly added.
Mr. Donnelly said 20 houses were now finished but a further 50
were under construction, the report adds.
*********
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 2015. All rights reserved. ISSN: 1520-9482.
This material is copyrighted and any commercial use, resale or
publication in any form (including e-mail forwarding,
electronic re-mailing and photocopying) is strictly prohibited
without prior written permission of the publishers.
Information contained herein is obtained from sources believed
to be reliable, but is not guaranteed.
TCR-AP subscription rate is US$775 for 6 months delivered via e-
mail. Additional e-mail subscriptions for members of the same
firm for the term of the initial subscription or balance
thereof are US$25 each. For subscription information, contact
Peter Chapman at 215-945-7000 or Nina Novak at 202-362-8552.
*** End of Transmission ***