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T R O U B L E D C O M P A N Y R E P O R T E R
A S I A P A C I F I C
Thursday, July 23, 2015, Vol. 18, No. 144
Headlines
A U S T R A L I A
EMPLOYMAC PTY: First Creditors' Meeting Set For July 30
GNC HOMES: First Creditors' Meeting Slated For July 30
QUITE BRILLIANT: Courts Appoints Clifton Hall as Liquidator
PRIORITY ONE: In Liquidation; First Meeting Set For July 31
WENDY'S SUPA: Administrators Close 4 Company-Owned Stores
C H I N A
GREENTOWN CHINA: Moody's Rates Proposed New USD Notes '(P)Ba3'
KINGBOARD CHEMICAL: S&P Affirms 'BB+' CCR; Outlook Stable
H O N G K O N G
GLORIOUS PROPERTY: Creditor Files Winding-Up Petition
I N D I A
ALASKA FABTECH: CRISIL Ups Rating on INR130M Term Loan to B-
ANAND EDUCATION: CRISIL Reaffirms B Rating on INR150MM Term Loan
BALAJI ENTERPRISES: ICRA Assigns B+ Rating to INR4.0cr LT Loan
BAY DATACOM: Ind-Ra Assigns 'IND BB+' Long-Term Issuer Rating
CAUVERY POWER: CRISIL Ups Rating on INR1.64BB Loan to 'B'
CHIRAG INTERNATIONAL: ICRA Reaffirms B-/A4 INR6.5cr Loan Rating
CORNISH ALUMINIUM: Ind-Ra Assigns 'IND D' Long-Term Issuer Rating
G.M. RAVINDRA: CRISIL Assigns B+ Rating to INR65MM Overdraft Loan
GANDHI INSTITUTE: ICRA Suspends B+ Rating on INR535cr Bank Loan
GANESHOM CEREALS: ICRA Suspends B- Rating on INR135cr Loan
GURUDEVA CHARITABLE: CRISIL Suspends D Rating on INR159.3MM Loan
IMMACULE LIFESCIENCES: CRISIL Reaffirms B Rating on INR347MM Loan
JAGWANI PROJECTS: CRISIL Reaffirms B Rating on INR180MM Cash Loan
JAI BHAWANI: CRISIL Reaffirms B+ Rating on INR70MM Cash Credit
JAI MAHAKAL: CRISIL Assigns B+ Rating to INR57MM Term Loan
KALYANI AGRO: CRISIL Suspends 'D' Rating on INR180MM Cash Loan
KANDUKURI INDUSTRIES: ICRA Assigns B+ Rating to INR8.80cr Loan
KHUKHRAIN COLD: CRISIL Assigns B+ Rating to INR30.5MM Term Loan
KIRTIMAN CEMENTS: ICRA Reaffirms 'B' Rating on INR13.5cr Loan
KRISHNA INDUSTRIAL: CRISIL Lowers Rating on INR110MM LOC to D
KRITIKA ENTERPRISES: CRISIL Reaffirms B Rating on INR80MM Loan
KRUPALI FASHIONS: ICRA Suspends B+ Rating on INR10cr Term Loan
KWALITY FOUNDRY: CRISIL Suspends B Rating on INR70MM Cash Loan
LATHANGI MOTORS: CRISIL Assigns 'B' Rating to INR135MM Loan
LOKNETE HONOURABLE: CRISIL Suspends 'D' Rating on INR187.4MM Loan
MAA SARASWATI: ICRA Suspends B- Rating on INR14.50cr LT Loan
MAHESHWARI TECHNOCAST: CRISIL Assigns B Rating to INR30MM Loan
NOOR IMPEX: CRISIL Lowers Rating on INR55MM Cash Credit to 'C'
OXFORD GOLF: CRISIL Lowers Rating on INR1.25BB LT Loan to 'D'
PARTH FOILS: ICRA Suspends 'D' Rating on INR54.38cr Term Loan
RANA MILK: Ind-Ra Assigns 'IND BB' Long-Term Issuer Rating
RUKMANI IMPEX: CRISIL Assigns 'D' Rating to INR150MM Term Loan
SAM APPARELS: ICRA Upgrades Rating on INR2.50cr Loan to B+
SANTHIRAM WIND: CRISIL Assigns 'B' Rating to INR75MM LT Loan
SARADA STARCH: CRISIL Suspends 'D' Rating on INR190MM Term Loan
SHREE KRISHNA: CRISIL Suspends 'D' Rating on INR115MM LT Loan
SHRI BIJASANI: CRISIL Reaffirms B Rating on INR70MM Cash Loan
SRI BALAMBIKA: CRISIL Cuts Rating on INR250MM Cash Loan to B+
SRI SAI: CRISIL Reaffirms 'B' Rating on INR80MM Cash Credit
SRI TEJA: CRISIL Reaffirms 'D' Rating on INR450MM LT Loan
SUPREME VASAI: Ind-Ra Cuts Senior Project Loans Rating to IND BB+
SWAPNA MOTORS: CRISIL Lowers Rating on INR140MM Cash Loan to B+
U.P ASBESTOS: CRISIL Cuts Rating on INR320MM Cash Loan to B-
UTTAR BHARAT: ICRA Suspends 'B' Rating on INR134cr LT Loan
VIBRANT CONSTRUCTION: CRISIL Rates INR20MM Cash Credit at B+
VIJAYALAKSHMI SPINTEX: ICRA Reaffirms B+ Rating on INR18cr Loan
VIJAYKIRAN EDUCATIONAL: CRISIL Suspends B+ Rating on INR380M Loan
YANTRA GREEN: CRISIL Lowers Rating on INR311.9MM LT Loan to 'D'
J A P A N
SKYMARK AIRLINES: Delta Japan Chief Sets Out Benefits of Alliance
TOSHIBA CORP: Regulators to Seek Penalty for False Accounting
TOSHIBA CORP: To Sell $1 Billion stake in Elevator Maker Kone
M A L A Y S I A
1MALAYSIA DEVELOPMENT: Singapore Police Freezes Two Bank Accounts
1MALAYSIA DEVELOPMENT: Datuk Remanded Over 1MDB Probe
N E W Z E A L A N D
LOMBARD FINANCE: Court Denies Ex-Directors Bid to Recall Judgment
S O U T H K O R E A
KOREA RESOURCES: Prosecutors Seek Arrest Warrant For Ex-Chief
- - - - -
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A U S T R A L I A
=================
EMPLOYMAC PTY: First Creditors' Meeting Set For July 30
-------------------------------------------------------
Richard Albarran and Cameron Shaw of Hall Chadwick Chartered
Accountants were appointed as administrators of Employmac Pty
Limited on July 20, 2015.
A first meeting of the creditors of the Company will be held at
Hall Chadwick Chartered Accountants, Level 11, 16 St Georges
Terrace, in Perth, on July 30, 2015, at 10:00 a.m.
GNC HOMES: First Creditors' Meeting Slated For July 30
------------------------------------------------------
David Ross and David Ingram of Hall Chadwick Chartered Accountants
were appointed as administrators of GNC Homes Pty Ltd on July 20,
2015.
A first meeting of the creditors of the Company will be held at
Chartered Accountants ANZ, Westpac Building, Level 29, 91 King
William Street, in Adelaide, on July 30, 2015, at 9:30 a.m.
QUITE BRILLIANT: Courts Appoints Clifton Hall as Liquidator
-----------------------------------------------------------
Timothy Clifton of Clifton Hall was appointed Official Liquidator
of Quite Brilliant Pty Ltd on July 22, 2015 by Order of the
Federal Court of Australia.
PRIORITY ONE: In Liquidation; First Meeting Set For July 31
-----------------------------------------------------------
Daniel Lopresti and Timothy Clifton of Clifton Hall were appointed
as Joint and Several Liquidators of Priority One Care & Service
Staff Pty Ltd on July 20, 2015.
A meeting of creditors will be held at 11:00 am on July 31, 2015,
at Clifton Hall, Level 3, 431 King William Street, in Adelaide.
WENDY'S SUPA: Administrators Close 4 Company-Owned Stores
----------------------------------------------------------
Wendy's Supa Sundaes Pty Ltd administrators said that the
administration has resulted in four company-owned and operated
stores being closed.
Ferrier Hodgson held the first creditors meeting of Wendy's Supa
on July 14.
At the meeting, Ferrier Hodgson's appointment as Voluntary
Administrators was ratified and a creditors' committee was
appointed to work with the Administrators.
Ferrier Hodgson reported on July 14 that arrangements with 141
current Wendy's franchised stores had been assigned to Supatreats
Australia -- the current licensee of the Wendy's brand in
Australia and New Zealand.
"In regards to a further 34 Wendy's franchised stores, these
stores may no longer be licensed to use Wendy's intellectual
property. However, Ferrier Hodgson is aware that Supatreats
Australia has been liaising directly with some of these 'non-
assigned' franchisees in relation to potentially entering into a
new franchise agreement direct with Supatreats Australia," Ferrier
Hodgson said in a statement.
In addition, the administration has resulted in four company owned
and operated stores being closed.
Ferrier Hodgson Partner Mr Martin Lewis said the company had
received proofs of debt from creditors totalling nearly AUD9
million, which was likely to increase as more information comes to
hand.
"It's too early to provide an accurate assessment of the financial
position of Wendy's Supa Sundaes Pty Ltd or an estimate of any
potential return to creditors," said Mr Lewis.
"We will continue to work through the financial affairs of Wendy's
Supa Sundaes Pty Ltd over the next few weeks and provide a report
and our recommendations to creditors for them to decide the
Company's future."
A second meeting for creditors will be held on Aug. 6, 2015,
unless otherwise extended.
About Wendy's Supa
Wendy's Supa Sundaes was founded in South Australia in 1979.
Martin Lewis and Tim Mableson were appointed Voluntary
Administrators of the Company on July 2, 2015.
Prior to the appointment, the Company ceased to be licensed to use
the Wendy's intellectual property, including its branding, and
therefore the Company ceased to carry on the business as the
franchisor pursuant to the various Franchise Agreements.
Accordingly, the Company has no ability to provide the franchisees
with access to the Wendy's intellectual property.
The current licensee of the Wendy's brand is Supatreats Australia
Pty Ltd.
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C H I N A
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GREENTOWN CHINA: Moody's Rates Proposed New USD Notes '(P)Ba3'
--------------------------------------------------------------
Moody's Investors Services has assigned a provisional (P)Ba3
senior unsecured debt rating to Greentown China Holdings Limited's
proposed new USD notes.
Moody's will remove the provisional status of the note rating
after the new USD notes are issued at satisfactory terms and
conditions.
Greentown's existing Ba3 corporate family rating and B1 senior
unsecured rating on the existing bond with a positive outlook
remain unchanged.
On July 20, 2015, Greentown announced that it is seeking consents
from its 2016 RMB, 2018 USD and 2019 USD senior note holders to
amend the terms of the notes.
At the same time, it will offer 2018 USD and 2019 USD notes
holders the option to exchange their existing notes into the new
set of USD notes.
Greentown may issue new notes for an amount in excess of the
exchanged amount.
It will use the proceeds of the new USD notes for refinancing
existing notes and general working capital purposes.
The new USD notes will be supported by a Keepwell Deed and a Deed
of Equity Interest Purchase, Investment and Liquidity Support
Undertaking provided by Greentown's major shareholder, China
Communications Construction Group (CCCG, unrated).
Concomitant with the proposed USD notes, Greentown has requested
bond investors to consider amending covenants in its existing
notes. Among others, it has asked for the inclusion of CCCG as
permitted holders and amending the definition of change of
control, as well as a relaxation of the fixed-charge coverage to
2.5x from 3x and in the determination of EBITDA.
RATINGS RATIONALE
"The (P)Ba3 rating of Greentown's proposed new USD notes, compared
with the company's existing notes, reflects the fact that the new
notes have additional support from CCCG through the Keepwell Deed
and the Deed of Equity Interest Purchase, Investment and Liquidity
Support Undertaking," says Jiming Zou, a Vice President and Senior
Analyst.
Moody's notes that CCCG has 28.9% ownership in Greentown, is the
company's largest shareholder, and has 5 representatives on its
Board of Directors.
CCCG's offering of the (1) Keepwell Deed and (2) Deed of Equity
Purchase, Investment and Liquidity Support Undertaking shows its
willingness to provide financial support to Greentown.
The new set of USD notes has the minimum control requirement of
25% ownership by CCCG. The Keepwell Agreement provides that it
has to keep Greentown solvent.
The Deed of Equity Purchase Agreement, Investment and Liquidity
Support Undertaking provides that CCCG covers any shortfall in
note repayments in the event of default through the purchase of
the equity of the issuer, direct lending to the issuer, or
investment in the issuer's projects.
CCCG is a state-owned enterprise (SOE) wholly owned by the State
Council of China. The company holds a 63.8% ownership stake in
China Communications Construction Co. Ltd. (A3 stable), which is
in turn one of the largest road and bridge construction companies
in China, and also a major port design and construction company in
the country.
China Communications Construction Co. Ltd. operates four main
business segments: (1) infrastructure construction, mainly of
roads, bridges and ports; (2) infrastructure design; (3) dredging;
and (4) the manufacture of heavy machinery.
Moody's expects CCCG will have the financial capacity to provide
financial support to Greentown in times of financial need.
"The proposed new USD notes will not materially raise the debt
leverage of Greentown and hence will have no impact on Greentown's
ratings," says Zou.
Greentown does not plan to raise a material level of new funds
through the new USD notes.
Moody's expects Greentown's credit metrics including pro-rata
adjustments for its jointly-controlled entities and associates
-- adjusted EBIT/Interest of 2x and revenue/adjusted debt of 70% -
75% in the next 12 -- 18 months - support its standalone credit
profile and Ba3 corporate family rating.
Moody's considers the requested for a change in covenants, except
for the introduction of minimum ownership of CCCG, as a weakening
of protection to bond holders.
But Moody's further expects that CCCG, which is supervised by
State-owned Assets Supervision and Administration Commission of
the State Council, will provide supervision over the financial
management of Greentown. In this way, Greentown is unlikely to
take an aggressive approach to financial management.
Greentown's Ba3 corporate family rating reflects its standalone
credit strengths and a one-notch rating uplift, based on our
expectation that the company will receive extraordinary financial
support from CCCG in times of financial distress.
Greentown's standalone credit profile reflects its well-
established market position in property development in Hangzhou
City and Zhejiang Province. The company exhibits a long operating
track record, sound brand name, quality products, and a large land
bank.
The company's standalone credit profile also considers its weak
liquidity position at end-2014 and high debt leverage. Moody's
notes that the company's growth through joint ventures leads to
challenges in managing cash flows and satisfying the capital needs
of these ventures.
CCCG has a significant influence on Greentown as it is the largest
shareholder.
CCCG's investment in Greentown will create more property
development opportunities for Greentown and widen its financing
channels.
The positive ratings outlook reflects Moody's expectation that
Greentown's liquidity position will improve. In particular, it
will have better access to bank funding, due to CCCG's ownership,
and given the latter's status as an SOE. Greentown will therefore
benefit from stable funding to support its business plans.
Greentown's ratings outlook could return to stable if the company:
(1) shows no improvement in its liquidity position, such that its
cash to short-term debt falls below 70%; or (2) shows a further
contraction in its profit margin to below 15%-20%, and if its
EBIT/interest falls below 2x for a sustained period.
Any evidence of weakening ownership and support from CCCG will
also negatively affect Greentown's ratings.
On the other hand, upward ratings pressure could emerge if
Greentown: (1) lowers its debt leverage, such that its revenue to
adjusted debt is maintained in excess of 80%-85%; (2) improves its
liquidity profile by exercising prudence in its financial
management and land acquisition strategy and (3) shows a track
record of support from CCCG.
The principal methodology used in this rating was Homebuilding And
Property Development Industry published in April 2015.
Greentown China Holdings Limited is one of China's major property
developers, with a primary focus in Hangzhou City and Zhejiang
Province. At end-2014, the company had 98 projects with a total
gross floor area of 34.89 million square meters. Of this total,
19.06 million square meters were attributable to the company.
KINGBOARD CHEMICAL: S&P Affirms 'BB+' CCR; Outlook Stable
---------------------------------------------------------
Standard & Poor's Ratings Services affirmed its 'BB+' long-term
corporate credit rating on Kingboard Chemical Holdings Ltd. The
outlook is stable. S&P also affirmed its 'cnBBB+' long-term
Greater China regional scale rating on the company. Kingboard is
a China-based manufacturer of laminates, printed circuit boards
(PCB), and chemical products, and a property development company.
"We affirmed the rating because we expect Kingboard to maintain
its solid market position in the laminate and PCB segments and
that the earnings contribution from the company's higher-margin
property business will increase over the next 12 months," said
Standard & Poor's credit analyst Tony Tang. "Both factors should
offset the risk from Kingboard's debt leverage, as defined by a
ratio of funds from operations [FFO] to debt."
S&P forecasts Kingboard's revenue from the laminate segment will
increase 3% to Hong Kong dollar (HK$) 11.8 billion in 2015, from
HK$11.5 billion in 2014. Also, S&P estimates that total sales
volume will increase to 101 million sheets from 95 million sheets.
However, weak copper prices could put mild pressure on the
company's laminate prices, given its cost-plus-pricing model for
the laminate business.
Kingboard has been diversifying away from the traditional PCB
business, which mainly focuses on personal computers and laptops,
to the advanced high-density interconnect (HDI) segment producing
automotive and smartphone products. S&P believes the HDI
automotive products segment will fuel the company's growth.
S&P expects revenues from Kingboard's chemical business to recover
to positive 3% in 2015, from negative 17% in 2014. This business
performed poorly in 2014 mainly because mid-to-downstream
customers postponed their purchases due to a sharp decrease in oil
and gas prices. Oil and gas prices have stabilized in 2015, and
S&P anticipates that demand in the chemical business will improve
but with a lower average selling price and slightly weaker gross
margin.
S&P anticipates the gross profit contribution from Kingboard's
property segment will increase to over 20% in 2015 and 2016, from
7% in 2013, because of higher revenue recognition. S&P forecasts
the rental income from the company's investment property portfolio
to reach HK$550 million in 2015, from HK$527 million in 2014. S&P
estimates that Kingboard will recognize HK$3.5 billion - HK$4
billion in property sales in 2015, from HK$2.1 billion in 2014.
S&P's estimate is based on its expectation that the company will
complete its Huaqiao phase 1 and 2 and Zhangpu phase 1 property
development projects. In 2014, Kingboard received over HK$4.6
billion in deposits from pre-sales of residential units.
In S&P's view, Kingboard's short operating history in the property
business with fast-growing scale may be a hurdle to execution,
given China's weak property market.
S&P expects Kingboard to remain prudent toward debt-funded land
acquisitions. The company has a land bank of more than 6 million
square meters, which is sufficient to sustain its business
development for the coming five years.
As of end-2014, Kingboard's gross debt is HK$22 billion, which is
largely in line with the company's balance-sheet exposure to the
property business. Kingboard has HK$10 billion of investment
properties and HK$19 billion of property held for development. In
S&P's opinion, Kingboard's debt leverage will improve moderately
in 2015 and 2016 as the company continues to recognize sales from
the property business and generates rental income from its
investment properties. In S&P's view, the property segment will
be the major factor affecting the company's credit profile over
the next 12-24 months.
"The stable outlook reflects our expectation that Kingboard will
maintain its market position and profitability over the next 12
months. We anticipate that the company's debt leverage will
improve moderately as it recognizes sales from property
development, resulting in the FFO-to-debt ratio staying at 20%-30%
over the next 12 months," said Mr. Tang.
S&P could lower the rating if Kingboard's FFO-to-debt ratio falls
below 20% for a prolonged period. This could happen if: (1)
Kingboard's debt-funded expansion (including acquisition of land
bank) is more aggressive than S&P's base-case scenario; or (2) the
company fails to maintain its profitability and its business
position deteriorates substantially due to intensified competition
or sluggish demand in all its businesses.
S&P could raise the rating if Kingboard reduces its debt or
improves profitability in all its businesses, such that its FFO-
to-debt ratio is consistently more than 30%.
================
H O N G K O N G
================
GLORIOUS PROPERTY: Creditor Files Winding-Up Petition
-----------------------------------------------------
South China Morning Post reports that Glorious Property Holdings
announced on July 21 that China Foreign Economy and Trade and
Trust Co filed a winding-up petition against it for alleged non-
payment of a CNY50 million (HK$62.5 million) loan plus accrued
interest and other amounts.
The Hong Kong-listed company said in a stock exchange filing that
it became aware of the petition at the High Court of Hong Kong on
July 21 and settled the sums on the same day, SCMP relates.
"In these circumstances, the board is of the view that the
petition would not have any material adverse impact on the group's
business and operations," the company added, notes SCMP.
According to the report, the fate of Glorious Property has been
under doubt after repeated attempts by controlling shareholder to
take it private failed.
The developer's contracted sales fell 1.2 per cent in the first
half from a year earlier to 123,088 square metres, but stronger
prices pushed sales revenues up by 11.5 per cent during the same
period to CNY2 billion, SCMP discloses.
That compared to total sales of CNY110 billion in the first six
months by China Vanke, the country's biggest homebuilder, listed
in both Hong Kong and Shenzhen, the report notes.
About Glorious Property
Headquartered in Central, Hong Kong, Glorious Property Holdings
Limited (HKG:0845) engages in the development and sale of
properties in the People's Republic of China (PRC). As of
December 31, 2014, it had a total land bank of 14.8 million square
meters in Shanghai Region, Yangtze River Delta, Pan Bohai Rim, and
Northeast China. The company has approximately 31 projects in 13
cities, including Beijing, Tianjin, Shanghai, Wuxi, Suzhou,
Nanjing, Nantong, Hefei, Harbin, Changchun, Shenyang, and Dalian.
As reported the Troubled Company Reporter-Asia Pacific on
April 30, 2015, Standard & Poor's Ratings Services said that it
had lowered its long-term corporate credit rating on Glorious
Property Holdings Ltd. to 'CCC-' from 'CCC'. The outlook is
negative. S&P also lowered its long-term Greater China regional
scale rating on the China-based developer to 'cnCCC-' from
'cnCCC'. At the same time, S&P lowered its long-term issue rating
on Glorious' senior unsecured notes to 'CC' from 'CCC-'. S&P also
lowered its long-term Greater China regional scale rating on the
notes to 'cnCC' from 'cnCCC-'.
"We lowered the rating because we see a high probability that
Glorious could default in the next six months without unforeseen
positive development," said Standard & Poor's credit analyst
Christopher Yip. "The company has yet to present a concrete
refinancing plan for its US$300 million notes due October 2015.
At the same time, Glorious' full-year 2014 results showed a
further weakening in its liquidity position as sales remained low
and the cash balance significantly depleted."
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I N D I A
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ALASKA FABTECH: CRISIL Ups Rating on INR130M Term Loan to B-
------------------------------------------------------------
CRISIL has upgraded its rating on the long-term bank facilities of
Alaska Fabtech Pvt Ltd (AFPL) to 'CRISIL B-/Stable' from 'CRISIL
D' and has assigned its 'CRISIL A4' rating to the company's short-
term bank facilities.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 82.5 CRISIL B-/Stable (Upgraded
from 'CRISIL D')
Overdraft Facility 17.5 CRISIL A4 (Reassigned)
Packing Credit 20 CRISIL A4 (Reassigned)
Term Loan 130 CRISIL B-/Stable (Upgraded
from 'CRISIL D')
The rating upgrade reflects CRISIL's belief that AFPL's liquidity
will improve over the medium term, with sufficient cash accruals
to meet term obligations. The company's liquidity is supported by
funding support from promoters by way of equity infusion/unsecured
loans. The promoters infused equity of INR44 million in the
company in 2014-15 (refers to financial year, April 1 to March 31)
to fund capital expenditure and loan repayment. AFPL is likely to
generate cash accruals of INR30 million to INR32 million over the
medium term, backed by moderate operating margin and expected
growth in turnover on account of healthy demand from customers and
recent enhancement in production capacities; it has term debt
obligations of INR28.3 million in 2015-16.
The ratings reflect AFPL's small scale of operations in the highly
fragmented textile industry and its weak financial risk profile,
marked by high gearing and low accruals. These rating weaknesses
are partially offset by the extensive industry experience of
AFPL's promoters.
Outlook: Stable
CRISIL believes that AFPL will continue to benefit over the medium
term from its promoters' extensive industry experience and their
funding support to meet the company's term debt obligations in a
timely manner. The company's financial risk profile is expected to
remain weak over the medium term, marked by high gearing and low
accruals. The outlook may be revised to 'Positive' if AFPL's
profitability improves and if the promoters infuse considerable
funds into the company, leading to improvement in its capital
structure. Conversely, the outlook may be revised to 'Negative' in
case of low profitability, resulting in decline in cash accruals,
or weakening of AFPL's working capital management.
AFPL, based in Derabassi (Punjab), manufactures terry towels, bath
robes, hooded towels, and children's bibs. It was incorporated in
2011 to take over SR Industries Ltd (SRIL). In April 2012, after
all the legal formalities were completed, the new management took
over SRIL and renamed it AFPL. The company's day-to-day operations
are managed by Mr. Shankar Bansal.
ANAND EDUCATION: CRISIL Reaffirms B Rating on INR150MM Term Loan
----------------------------------------------------------------
CRISIL's rating on the long-term bank facility of Anand Education
& Research Trust (AERT) continues to reflect AERT's weak financial
risk profile, marked by weak debt protection metrics on account of
operating losses, and the susceptibility of its margins to any
adverse impact of regulatory changes. These rating weaknesses are
partially offset by the extensive experience of AERT's promoters
in the educational segment and the strong financial support they
extend to the trust.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Term Loan 150 CRISIL B/Stable (Reaffirmed)
Outlook: Stable
CRISIL believes AERT will continue to benefit over the medium term
from the infusion of funds by its promoters. The outlook may be
revised to 'Positive' if the trust's revenue and surplus levels
improve significantly, resulting in adequate cash accruals for
servicing its debt. Conversely, the outlook may be revised to
'Negative' if AERT's operating surplus declines, or the expected
funding support does not materialise, or the trust undertakes a
major debt-funded capital expenditure programme.
AERT was established in 2007 by Mr. Manoj Mittal and Mr. Anand
Mittal to set up engineering, management, and medical institutes.
The trust currently operates the Anand International College of
Engineering in Kanota (Rajasthan).
BALAJI ENTERPRISES: ICRA Assigns B+ Rating to INR4.0cr LT Loan
--------------------------------------------------------------
ICRA has assigned a long-term rating of [ICRA]B+ to the INR4.00
crore fund based facilities and INR0.93 crore term loan of
Balaji Enterprises. ICRA has also assigned a short-term rating of
[ICRA]A4 to the INR1.00 crore non-fund based facilities of the
Firm.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term: Fund
based facilities 4.00 [ICRA]B+/assigned
Long-term: Term Loan 0.93 [ICRA]B+/assigned
Short-term: Non-fund
based facilities 1.00 [ICRA]A4/assigned
The ratings factor in the significant experience of the promoters
in the industry and the Firm's long-standing relationship with its
customers that have supported a healthy flow of orders over the
years. The ratings also take into consideration the relatively
wider range of services offered by the Firm when compared with the
other players which provides the Firm an edge over its
competitors. The ratings are, however, constrained by the firm's
small scale of operations that limits the benefits from economies
of scale and financial flexibility. Coupled with the intense
competition owing to a fragmented nature of industry, this also
limits its pricing flexibility to an extent. Moreover, the firm's
financial profile is moderately weak characterized by high
gearing, stretched coverage indicators and high working capital
intensity. Going forward, the firm's ability to improve its sales
and to keep its working capital intensity under control would be
key rating sensitivities.
Balaji Enterprises was established in the year 1994 as
proprietorship firm after merging the business assets of M/s
Konark International under the leadership of Mr. Sukhbir Singh and
later on converted into a Partnership entity in the year 2008 with
his wife Mrs. Navdeep Kaur as another partner. The Firm is
primarily engaged in processing and manufacturing of finished
leather. The Firm's processing facility factory at Ranipet has a
floor area of 32,000 sq. ft. and a capacity to produce 50,00,000
sq. ft. of finished leather.
Recent Results
According to the 2014-15 provisional financial statements, the
Firm has reported an operating income of Rs.14.6 crore during
FY2015 as against a net profit of INR0.3 crore on an operating
income of INR12.34 crore during 2013-14.
BAY DATACOM: Ind-Ra Assigns 'IND BB+' Long-Term Issuer Rating
-------------------------------------------------------------
India Ratings and Research (Ind-Ra) has assigned Bay Datacom
Solutions Private Limited (BDSPL) a Long-Term Issuer Rating of
'IND BB+'. The Outlook is Stable. BDSPL's bank facilities have
been assigned ratings as follows:
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Fund-based limits 36 'IND BB+'/Stable
Non-fund-based limits 60 'IND A4+'
KEY RATING DRIVERS
Ind-Ra has taken a consolidated view of BDSPL and its wholly owned
subsidiary Bay Digital Pte Ltd while assigning the ratings. The
companies have strong operational and strategic inter-linkages
through the same line of business, common founders and fungibility
of funds.
The ratings reflect comfortable consolidated credit metrics of the
two companies with interest coverage of 12.7x in FY15 (FY14: 2.8x)
and net leverage of 0.4x (2.58x). The scale of operations is small
with consolidated turnover of INR997.3 million in FY15 (FY14:
INR495.2 million).
The ratings also reflect the moderate standalone credit metrics of
BDSPL with EBITDA interest coverage of 2.9x in FY15 (FY14: 1.9x),
net leverage (total adjusted net debt/operating EBITDA) of 2.7x
(4.1x) and the trading nature of its operations with thin EBITDA
margins of 1.3% (2.3%). BDSPL's scale of operations is small with
revenue of INR582m (INR395m) in FY15. Liquidity is comfortable
with average maximum use of the working capital limits of 60% over
the 12 months ended May 2015. Also, the debt of BDSPL comprises
only working capital facilities hence, there are no refinancing
risks.
RATING SENSITIVITIES
Positive: A positive rating action could result from a substantial
increase in the consolidated revenue and profitability leading to
improved credit metrics.
Negative: A negative rating action could result from a decline in
the consolidated revenue and profitability resulting in
deteriorated credit metrics.
COMPANY PROFILE
BDSPL, incorporated in 1998, trades IT components and provides
enterprise IT infrastructure solutions. Its services include
system integration of data, voice, security and surveillance
product development. It has a registered office at Hyderabad,
three branch offices in India and one in the US. Its 100%
subsidiary Bay Digital Pte Ltd is based out of Singapore.
Total debt outstanding on 31 March 2015 was INR21.5 million,
comprising working capital debt of INR20.3m and unsecured debt of
INR1.2 million.
CAUVERY POWER: CRISIL Ups Rating on INR1.64BB Loan to 'B'
---------------------------------------------------------
CRISIL has upgraded its ratings on the bank facilities of Cauvery
Power Generation Chennai Private Limited (CPGCPL) to 'CRISIL
B/Stable/CRISIL A4' from 'CRISIL D/CRISIL D'.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Bank Guarantee 30 CRISIL A4 (Upgraded from
'CRISIL D')
Cash Credit 370 CRISIL B/Stable (Upgraded
from 'CRISIL D')
Letter of Credit 130 CRISIL A4 (Upgraded from
'CRISIL D')
Long Term Loan 1643.5 CRISIL B/Stable (Upgraded
from 'CRISIL D')
Proposed Working
Capital Facility 62.6 CRISIL B/Stable (Upgraded
from 'CRISIL D')
The rating upgrade reflects regularisation of CPGCPL's debt
servicing following improvement in the company's liquidity since
2014-15 (refers to financial year, April 1 to March 31). The
upgrade also factors in increase in CPGCPL's scale of operations
and operating margin in the first quarter of 2015-16, on account
of the power purchase agreements it has entered into, resulting in
assured offtake by customers and revision in price tariffs. CPGCPL
is likely to generate net cash accruals of around INR800 million
per annum, which will be adequate to meet its term debt
obligations, over the medium term. CRISIL believes that CPGCPL
will sustain its increased scale of operations and operating
profitability over the medium term.
The rating reflects CPGCPL's leveraged capital structure and
modest scale of operations. These rating weaknesses are partially
offset by the extensive experience of the company's promoters in
the power generation industry and the high demand for power in
Tamil Nadu.
Outlook: Stable
CRISIL believes that CPGCPL will continue to benefit over the
medium term from the extensive experience of its promoters and
assured offtake by customers. The outlook may be revised to
'Positive' if the company sustains the improvement in its revenue
and operating profitability, while maintaining its working capital
cycle, thereby improving its financial risk profile. Conversely,
the outlook may be revised to 'Negative' if CPGCPL reports
deterioration in its financial risk profile, most likely because
of a sharp decline in its accruals or sizeable debt-funded capital
expenditure or additional fund support to group entities.
CPGCPL, set up by Mr. S Elangovan and Mr. S A Prem Kumar, operates
a 63-megawatt coal-based power plant in Chennai.
On a provisional basis, CPGCPL reported profit after tax (PAT) of
INR160.5 million on total income of INR778.2 million for the three
months ended June 30, 2015. CPGCPL reported PAT of INR256.46
million on total income of INR2.62 billion for 2014-15, against a
loss of INR86.43 million on total income of INR1.88 billion for
2013-14.
CHIRAG INTERNATIONAL: ICRA Reaffirms B-/A4 INR6.5cr Loan Rating
---------------------------------------------------------------
ICRA has reaffirmed its [ICRA]B- rating on the long-term scale and
[ICRA]A4 rating on the short-term scale, on the INR6.50 crore
fund-based bank facilities of Chirag International. ICRA has also
reaffirmed its [ICRA]A4 rating on the Rs.0.28 crore short-term
non-fund based bank facilities of the firm.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term fund-based 6.50 [ICRA]B-/[ICRA]A4
bank facilities (Reaffirmed)
Short-term non fund-
based bank facilities 0.28 [ICRA]A4 (Reaffirmed)
The rating reaffirmation takes into account the 29% year-on-year
decline in the firm's Operating Income (OI) in FY15, on account of
a slow-down in demand. While the firm's operating profit margins
have registered an improvement over this period, an increase in
interest expenses has led to net profit margins in FY15, remaining
at broadly the same levels as the previous year.
The ratings continue to take into account Chirag International's
high client concentration and its high working capital intensity
owing to large credit period offered to overseas clients, high
inventory holding period and limited credit available from
suppliers. The rating also factors in the firm's weak financial
profile as reflected in elevated Total Debt/OPBDITA of 7.3x in
FY15, NCA/ Total debt of 3% and interest coverage of 1.27x in
FY15. The ratings also factor in the vulnerability of the firm's
profitability to adverse fluctuations in exchange rates and
volatility in raw material costs. However, ICRA notes that the
firm is partly mitigating the forex risk by entering into forward
contracts for export sales. The ratings, however, continue to draw
comfort from the extensive track record of the firm, of over two
decades, which is reflected in long established relations with its
key customers and has resulted in repeat orders.
Going forward, the firm's ability to ramp up its scale of
operations, along with an improvement in margins, while optimizing
its working capital cycle, will be the key rating sensitivities.
Chirag International is a partnership firm formed in December
1993, by members of the Agarwal family in Ludhiana, Punjab. The
firm manufactures nuts, bolts, hardware goods, auto parts and
motor parts. About 75% of the firm's FY15 revenues were derived
from exports to Saudi Arabia, United Arab Emirates, Italy and
Spain.
CORNISH ALUMINIUM: Ind-Ra Assigns 'IND D' Long-Term Issuer Rating
-----------------------------------------------------------------
India Ratings and Research (Ind-Ra) has assigned Cornish Aluminium
India Private Limited (CAIPL) a Long-Term Issuer Rating of 'IND
D'. Ind-Ra has also assigned CAIPL's INR140 million term loan a
Long-Term 'IND D' rating.
KEY RATING DRIVERS
The ratings reflect delay in servicing of term loan obligations
since June 2014 due to tight liquidity.
RATING SENSITIVITIES
Timely debt servicing for three consecutive months could result in
a positive rating action.
CAIPL was incorporated in 2010 by Sunil Pathak to provide services
in the area of construction supporting systems by having in-house
designing team besides the entire range of scaffolding systems.
G.M. RAVINDRA: CRISIL Assigns B+ Rating to INR65MM Overdraft Loan
-----------------------------------------------------------------
CRISIL has assigned its 'CRISIL B+/Stable/CRISIL A4' ratings to
the bank facilities of G.M. Ravindra (GMR).
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Bank Guarantee 35 CRISIL A4
Overdraft Facility 65 CRISIL B+/Stable
The ratings reflect GMR's modest scale of operations in a
fragmented civil construction industry, its large working capital
requirements, and customer concentration in its revenue profile.
These rating weaknesses are partially offset by the extensive
industry experience of GMR's proprietor in the civil construction
industry.
Outlook: Stable
CRISIL believes that GMR will continue to benefit over the medium
term from its proprietor's extensive experience in the civil
construction industry. The outlook may be revised to 'Positive' if
the firm reports substantial growth in its scale of operations
while maintaining its profitability and capital structure.
Conversely, the outlook may be revised to 'Negative' in case there
is significant decline in the firm's revenue or profitability, or
in case of stretch in its working capital cycle, or if it
undertakes any large debt-funded capital expenditure programme,
thereby significantly impacting its financial risk profile.
GMR was set up in 2004 as a sole proprietorship concern by Mr. G M
Ravindra in Bengaluru. The firm is engaged in civil construction
works, primary construction of Reinforced Concrete (RCC) culverts
and storm water drains, in Bengaluru. GMR is a registered
contractor with Bruhat Bengaluru Mahanagara Palike (BBMP).
GMR, on a provisional basis, reported a profit after tax (PAT) of
INR5.2 million on net sales of INR78.8 million for 2014-15 (refers
to financial year, April 1 to March 31); the firm reported a PAT
of INR3.6 million on net sales of INR61.5 million for 2013-14.
GANDHI INSTITUTE: ICRA Suspends B+ Rating on INR535cr Bank Loan
---------------------------------------------------------------
ICRA has suspended long term rating of [ICRA]B+ rating assigned to
the INR535.00 crore bank facilities of Gandhi Institute of
Technology and Management. The suspension follows ICRA's inability
to carry out a rating surveillance in the absence of the requisite
information from the company.
GANESHOM CEREALS: ICRA Suspends B- Rating on INR135cr Loan
----------------------------------------------------------
ICRA has suspended [ICRA]B- rating assigned to the INR135 crore,
working capital limits of Ganeshom Cereals Pvt Ltd. The suspension
follows ICRA's inability to carry out a rating surveillance in the
absence of the requisite information from the company.
GURUDEVA CHARITABLE: CRISIL Suspends D Rating on INR159.3MM Loan
-----------------------------------------------------------------
CRISIL has suspended its rating on the bank facilities of
Gurudeva Charitable Trust (GCT).
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Long Term Loan 159.3 CRISIL D
Proposed Overdraft
Facility 60 CRISIL D
Proposed Term Loan 50.7 CRISIL D
The suspension of ratings is on account of non-cooperation by GCT
with CRISIL's efforts to undertake a review of the ratings
outstanding. Despite repeated requests by CRISIL, GCT is yet to
provide adequate information to enable CRISIL to assess GCT'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'
GCT, located in Ernakulam (Kerala), was set up in 2003, and
operates a medical college and hospital called Sree Narayana
Institute of Medical Sciences. The college offers a five-year
undergraduate course in medicine. The day-to-day operations of the
trust are managed by its executive director, Colonel Ramesh.
IMMACULE LIFESCIENCES: CRISIL Reaffirms B Rating on INR347MM Loan
-----------------------------------------------------------------
CRISIL's rating on the long-term bank loan facilities of Immacule
Lifesciences Pvt Ltd (ILPL) continues to reflect ILPL's weak debt
protection metrics on account of low profits on account of start-
up phase of operations. This rating weakness is partially offset
by the extensive experience of ILPL's promoters in the
pharmaceutical formulations industry.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 70 CRISIL B/Stable (Reaffirmed)
Foreign Currency
Term Loan 347 CRISIL B/Stable (Reaffirmed)
Proposed Long Term
Bank Loan Facility 55 CRISIL B/Stable (Reaffirmed)
Term Loan 75 CRISIL B/Stable (Reaffirmed)
Outlook: Stable
CRISIL believes that ILPL will continue to benefit over the medium
term from its experienced management; however, the company's
financial risk profile will be constrained over the period by its
start-up phase of operations and large debt obligations. The
outlook may be revised to 'Positive' in case of stabilisation of
operations and substantial off-take leading to revenue growth and
large cash accruals, and consequently, a better financial risk
profile. Conversely, the outlook may be revised to 'Negative' in
case of lower than expected revenues leading to weaker liquidity
levels.
Update
ILPL started operations in December 2014 and booked gross sales of
around INR46 million till March 31, 2015. CRISIL expects ILPL's
gross sales to remain around INR600 million for 2015-16 (refers to
financial year, April 1 to March 31) because of scale-up of
operations due to addition of customers in 2014-15, the company
incurred losses on account of initial year of operations; however,
ILPL's profitability is expected to improve over the medium term
supported by absorption of fixed overheads as it ramps up
operations.
ILPL's net worth is estimated to be healthy, over INR230 million,
as on March 31, 2015, due to equity infusion of INR91 million by
the promoters during 2014-15. Because of the equity infusion,
ILPL's gearing is estimated to be moderate, at 1.84 times as on
March 31, 2015, despite large debt-funded capital expenditure
(capex). The gearing is expected to improve gradually over the
medium term because of absence of debt-funded capex plans along
with improvement in accretion to reserves. ILPL had poor debt
protection measures in 2014-15 because of net losses on account of
high fixed overheads. CRISIL expects ILPL's debt protection
metrics to improve over the medium term because of scale-up of
operations leading to increase in accruals.
ILPL's liquidity remains weak as the company's ability to generate
sufficient cash accruals to meet debt obligations of INR40.5
million in 2015-16 is yet to be seen and CRISIL believes it will
remain a key rating sensitivity factor over the medium term. Its
bank limit utilization was moderate, averaging 81.5 per cent over
the seven months through April 2015.
ILPL is a Nalagarh (Himachal Pradesh)-based pharmaceuticals
formulator. The company started commercial operations in December
2014 and manufactures pharmaceutical formulations, primarily
injectibles, which will be marketed in overseas markets such as
Indonesia, Vietnam, the Philippines, Venezuela, and Chile. ILPL is
promoted by Mr. Viral Shah, Mr. Rishi Aggarwal, Mr. Suchet
Rastogi, and Mr. Nirav Maniar.
JAGWANI PROJECTS: CRISIL Reaffirms B Rating on INR180MM Cash Loan
-----------------------------------------------------------------
CRISIL's rating on the bank facilities of Jagwani Projects Pvt Ltd
(JPPL) continues to reflect JPPL's working-capital intensive
operations and its weak financial risk profile, marked by a small
net worth, and high total outside liabilities to tangible net
worth ratio and gearing.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 180 CRISIL B/Stable (Reaffirmed)
Proposed Term Loan 70 CRISIL B/Stable (Reaffirmed)
These rating weaknesses are partially offset by the extensive
entrepreneurial experience of the company's promoters.
Outlook: Stable
CRISIL believes that JPPL will continue to benefit over the medium
term from its promoters' extensive entrepreneurial experience. The
outlook may be revised to 'Positive' if there is a substantial and
sustained improvement in JPPL's scale of operations and
profitability, along with improvement in its liquidity because of
substantial increase in accruals and controlled working capital
cycle, or large long-term fund infusion by the promoters.
Conversely, the outlook may be revised to 'Negative' if JPPL's
accruals decline substantially, or if it witnesses a stretch in
its working capital cycle, or undertakes any large debt-funded
capital expenditure programme, resulting in deterioration in its
financial risk profile, particularly its liquidity.
JPPL, incorporated in 1988, is promoted by the Kolkata (West
Bengal)-based Jagwani family. It currently exports iron ore fines.
The company has also diversified in the manufacture of light
emitting diode (LED) lighting systems. The company manufactures
bulbs, tube lights, panel lights etc. under its LED lighting
division.
JAI BHAWANI: CRISIL Reaffirms B+ Rating on INR70MM Cash Credit
--------------------------------------------------------------
CRISIL's rating on the long-term bank facilities of Jai Bhawani
Trading Co. (JBTC) continue to reflect its below-average financial
risk profile, marked by a small net worth and weak debt protection
metrics.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 70 CRISIL B+/Stable (Reaffirmed)
Proposed Long Term
Bank Loan Facility 10 CRISIL B+/Stable (Reaffirmed)
The rating also factors in JBTC's modest scale of operations in
the highly fragmented agro-commodity trading segment. These rating
weaknesses are partially offset by the proprietor's extensive
industry experience, and the firm's established customer
relationships.
Outlook: Stable
CRISIL believes that JBTC will continue to benefit over the medium
term from its established customer relationships and the
proprietor's extensive industry experience. The outlook may be
revised to 'Positive' if the company improves its financial risk
profile with sizeable revenue growth, and enhanced profitability
leading to higher accretion to reserves. Conversely, the outlook
may be revised to 'Negative' if JBTC's financial risk profile
weakens with a decline in profitability or revenue, or a stretched
working capital cycle, resulting in significantly low cash
accruals.
JBTC was set up by Mr. Rakesh Agarwal in Nagpur (Maharashtra) in
1998 as a proprietorship concern. The firm trades in wheat, maize,
poultry feed, and a variety of other food grains.
JBTC reported a profit after tax (PAT) of INR0.9 million on net
sales of INR450.3 million for 2014-15 (refers to financial year,
April 1 to March 31) on a provisional basis, as against a PAT of
INR 0.7 million on net sales of INR382.8 million for 2012-13.
JAI MAHAKAL: CRISIL Assigns B+ Rating to INR57MM Term Loan
----------------------------------------------------------
CRISIL has assigned its 'CRISIL B+/Stable' rating to the long-term
bank loan facility of Jai Mahakal Warehousing Company (JMWC).
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Term Loan 57 CRISIL B+/Stable
The rating reflects JMWC's modest scale of operations and limited
track record in the competitive warehousing industry. These rating
weaknesses are partially offset by JMWC's long-term lease
agreement with the Government of Madhya Pradesh (GoMP) leading to
long-term revenue visibility and the high profitability of its
operations.
Outlook: Stable
CRISIL believes that JMWC will continue to benefit from its long-
term lease agreement with GoMP and from high operating
profitability of its warehousing business. The outlook may be
revised to 'Positive' if JMWC reports increase in scale of
operations and stable profitability, leading to substantial
accruals. Conversely, the outlook may be revised to 'Negative' in
case of unexpected termination of JMWC's lease contract with GoMP,
adversely affecting the firm's cash flows, or in case of large
debt-funded capital expenditure leading to pressure on its
financial risk profile.
Formed in 2014, JMWC is a partnership firm engaged in leasing and
operating warehouses for agricultural products. Its warehousing
facility is at Dabra in Gwalior (Madhya Pradesh).
KALYANI AGRO: CRISIL Suspends 'D' Rating on INR180MM Cash Loan
--------------------------------------------------------------
CRISIL has suspended its ratings on the bank facilities of Sri
Kalyani Agro Products and Industries Ltd (SKAPIL).
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 180 CRISIL D
Letter of Credit 20 CRISIL D
Term Loan 84.7 CRISIL D
The suspension of ratings is on account of non-cooperation by
SKAPIL with CRISIL's efforts to undertake a review of the ratings
outstanding. Despite repeated requests by CRISIL, SKAPIL is yet to
provide adequate information to enable CRISIL to assess SKAPIL'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'
SKAPIL was originally formed in 1985 as a partnership firm,
Kalyani Agro Products and Industries, by Mr. Vanapalli Narayana
Rao and his family members; the firm was reconstituted as a public
limited company with its current name in 1999. SKAPIL is based in
the West Godavari district of Andhra Pradesh. The company has a
rice mill, with processing capacity of 480,000 quintals per annum.
In 2002, it set up a 4-megawatt biomass power plant. In 2005,
SKAPIL also set up a steel ingot manufacturing unit, with a
capacity of 33,000 tonnes per annum.
KANDUKURI INDUSTRIES: ICRA Assigns B+ Rating to INR8.80cr Loan
--------------------------------------------------------------
ICRA has assigned the long term rating of [ICRA]B+ to the INR8.80
crore fund based limits and INR0.20 crore unallocated limits of
Kandukuri Industries Private Limited. ICRA has also assigned short
term rating of [ICRA]A4 to the INR1.00 crore non fund based limits
of the company.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Fund Based Limits 8.80 [ICRA]B+ assigned
Non Fund Based Limits 1.00 [ICRA]A4 assigned
Unallocated 0.20 [ICRA]B+ assigned
The assigned ratings take into account the company's moderate
scale of operation of each division in a highly competitive
textile and construction industry limiting the financial
flexibility. The ratings are constrained by susceptibility of
margins to fluctuations in volatile raw material price
fluctuations in RMG division and high overheads leading to
pressure on margins of KIPL. The ratings are further constrained
by stretched liquidity position on account of working capital
intensive nature of business as reflected by high utilisation of
fund based facilities. The ratings also take into account low
unexecuted order book to operating income ratio of 1.02 times as
on March 31, 2015 for construction division reflecting limited
revenue visibility in the long-term.
The ratings however, positively factor in long track record of
promoters in textile industry resulting into established
relationships with the customers and raw material suppliers. The
ratings also favourably factor in diversified revenue base of the
company with its presence in four segments and location advantage
of the textile unit due to its presence in major cotton growing
areas of Andhra Pradesh providing easy access for cotton yarn
procurement.
Kandukuri Industries Private Limited (KIPL) was incorporated by
Mr. K V Satyanarayana in 1995. The company operates four divisions
- weaving division and readymade garments (RMG) division involved
in manufacture and sales of men's garments, healthcare division,
operating a 50 bed hospital, and construction division, where KIPL
executes projects for canal and college buildings. The weaving
division accounts for 51%, RMG for 28.74%, construction for 14.28%
& hospital for 5.94% of revenue contribution.
Mr.K V Satyanaryana is the Chairman & Managing Director of
Kandukuri Industries Private Limited. He has 45 years experience
in the textile industry. He started with a small retail shop in
1968 and started manufacture of Readymade Garments in 1994 and
entered into weaving in 2006.
Recent Results
As per provisional financials of FY15, KIPL reported an operating
income of INR51.56 crore with an operating profit of Rs.7.11 crore
against an operating income of INR49.87 crore with an operating
profit of INR6.69 crore in FY2014.
KHUKHRAIN COLD: CRISIL Assigns B+ Rating to INR30.5MM Term Loan
---------------------------------------------------------------
CRISIL has assigned its 'CRISIL B+/Stable/CRISIL A4' ratings to
the bank facilities of Khukhrain Cold Storage & Ice Factory (KCS).
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Overdraft Facility 55 CRISIL A4
Term Loan 30.5 CRISIL B+/Stable
The ratings reflect KCS's weak financial risk profile, marked by
high TOLTNW ratio (total outside liabilities to tangible net
worth) and weak debt protection metrics. The rating also factors
in KCS's small scale of operations in the highly fragmented cold
storage industry with working capital intensive operations. These
rating weaknesses are partially offset by the extensive industry
experience of KCS's promoters.
Outlook: Stable
CRISIL believes that KCS will continue to benefit from its
partners' extensive industry experience. The outlook may be
revised to 'Positive' if the firm significantly increases its
scale of operations and profitability or receives a large equity
infusion, thus improving its capital structure. Conversely, the
outlook may be revised to 'Negative' if KCS's financial risk
profile and liquidity deteriorate because of sizeable working
capital requirements and debt-funded capital expenditure.
KCS is a Chandigarh-based partnership firm promoted by Sahni
family. The firm operates a cold storage unit and provides
warehousing and logistics services for dairy products, frozen meat
products, frozen vegetables, and beverages through a cold storage
and a fleet of refrigerated vehicles.
For 2014-15 (refers to financial year, April 1 to March 31), KCS
reported a provisional book profit of INR2.1 million on net sales
of INR239.7 million, against a book profit of INR1.9 million on
net sales of INR234.2 million for 2013-14.
KIRTIMAN CEMENTS: ICRA Reaffirms 'B' Rating on INR13.5cr Loan
-------------------------------------------------------------
ICRA has reaffirmed its long term rating of [ICRA]B on the
INR18.00 crore fund based limits of Kirtiman Cements and Packaging
Industries Limited.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Term Loan 4.50 [ICRA]B; reaffirmed
Cash Credit 13.50 [ICRA]B; reaffirmed
ICRA's rating continues to be constrained by the highly
competitive nature of the industry with low entry barriers and
vulnerability of KCIPL's profitability to fluctuations in polymer
prices, which have led to relatively weak and fluctuating profit
margins. The rating also factors in the company's low bargaining
power vis-…-vis its key customers and suppliers which are
primarily larger entities. The ratings are also constrained by the
stretched liquidity position of the company as reflected in full
utilization of working capital limits. Further, the rating also
takes into account the company's weak coverage indicators and its
cash accruals which are insufficient to meet the scheduled debt
repayments. Nevertheless, the rating factors in the extensive
experience of the promoters in the packaging industry and the fact
that the company is a part of the Ashwani Oberoi Construction
Company India limited (AOCC) group which has six companies which
are engaged in the trading and manufacturing of packaging products
like Poly Propylene (PP) bags, corrugated boxes and gunny bags.
The rating also takes note of the healthy growth in the company's
operating income in the past and favorable long-term demand
prospects from the end user industry.
Going forward, the ability of the company to maintain adequate
liquidity and sustain its revenue growth, while maintaining its
profitability, will be the key rating sensitivities.
KCPIL was incorporated in 1996 and manufactures PP woven fabric
bags used in packaging. Apart from selling PP woven bags, the
company also supplies PP woven fabric to traders. The key
promoters of the company are Mr. Ashwani Kumar Oberoi, Mr. Sunil
Kumar Oberoi and their family members. The company is a part of
the AOCC group which is also engaged in a similar line of
business. The manufacturing facility of the company is located in
Yamuna Nagar, Haryana with an installed capacity of 5400 Metric
Tonnes (MT) per annum to manufacture PP woven bags.
Recent Results
KCPIL reported, on a provisional basis, a profit after tax (PAT)
of INR0.82 crore on an operating income of INR91.35 crore for the
year ended March 31, 2015, as against a PAT of INR0.47 crore on an
operating income of INR86.28 crore for the previous year.
KRISHNA INDUSTRIAL: CRISIL Lowers Rating on INR110MM LOC to D
-------------------------------------------------------------
CRISIL has downgraded its ratings on the bank facilities of
Krishna Industrial Corporation Ltd (KICL) to 'CRISIL D/CRISIL D'
from 'CRISIL C/CRISIL A4'.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 40 CRISIL D (Downgraded from
'CRISIL C')
Letter of Credit 110 CRISIL D (Downgraded from
'CRISIL A4')
The rating downgrade reflects continuous irregularities by KICL in
servicing its debt. The delays have been caused by the company's
weak liquidity, resulting from stretched subsidy receivables.
KICL also has a weak financial risk profile, marked by highly
leveraged capital structure and weak debt protection metrics. The
company, however, benefits from its promoter's extensive
experience in the fertiliser industry.
KICL was established as a public limited company in 1947 by Mr.
Velagapudi Ramakrishna. The company, currently managed by Mr. S R
K Prasad (grandson of Mr. Ramakrishna), operates in three
divisions: fertiliser and chemical, industrial gas, and computer
software packages. KICL derives close to 90 per cent of its
revenue from its fertiliser and chemical division.
KICL reported, on a provisional basis, a net loss of INR34.5
million on net sales of INR233.4 million for 2014-15 (refers to
financial year, April 1 to March 31); the company reported a net
loss of INR7.4 million on net sales of INR435.2 million for 2013-
14.
KRITIKA ENTERPRISES: CRISIL Reaffirms B Rating on INR80MM Loan
--------------------------------------------------------------
CRISIL's rating on the long-term bank facility of Kritika
Enterprises (KRE) continues to reflect KRE's moderate business
risk profile, small scale of operations, large working capital
requirements, and susceptibility to intense competition in the
iron and steel industry and to volatility in raw material prices.
The rating also factors in the firm's low operating margin on
account of the trading nature of its business, and weak financial
risk profile marked by a small net worth and weak debt protection
metrics.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 80 CRISIL B/Stable (Reaffirmed)
These rating weaknesses are partially offset by the benefits that
KRE derives from its promoters' extensive experience in the steel
industry and the firm's wide product range.
Outlook: Stable
CRISIL believes that KRE will continue to benefit over the medium
term from the promoters' extensive industry experience. The
outlook may be revised to 'Positive' if the firm's financial risk
profile and liquidity improve with an enhanced working capital
cycle or sizeable profitability. Conversely, the outlook may be
revised to 'Negative' if KRE's financial risk profile and
liquidity deteriorate because of an increase in its working
capital cycle, significantly low cash accruals, or large debt-
funded capital expenditure.
KRE was established in Jamshedpur (Jharkhand). The firm trades in
iron and steel products such as iron rod ingots, pig iron, sponge
iron, polled iron, sulphur, hot-rolled coils, and cold-rolled
coils. The partners, Mr. Amarnath Singh, Mr. Uday Sankar Prasad,
Mr. Suresh Kumar Sharma, and Mrs. Rita Gupta, manage KRE's daily
operations.
KRUPALI FASHIONS: ICRA Suspends B+ Rating on INR10cr Term Loan
--------------------------------------------------------------
ICRA has suspended [ICRA]B+ and [ICRA]A4 ratings assigned to the
INR15.40 crore fund based and non-fund based facilities of Krupali
Fashions Private Limited. The suspension follows ICRA's inability
to carry out a rating surveillance in the absence of the requisite
information from the company.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Fund based- Term Loan 10.00 [ICRA]B+ Suspended
Fund based- Cash Credit 5.00 [ICRA]B+ Suspended
Non-Fund based- Bank
Guarantee 0.40 [ICRA]A4 Suspended
Incorporated in May 2013, KFPL procures fabric from vendors in
Surat and Ahmedabad and outsources dying and embroidery work to
job-work contractors located in Surat. The designing work and low
value added processes like folding, cutting, packing etc. are done
in-house and subsequently, the material is sold in the North
Indian market under the brand name 'Krupali' and 'Udaan'. From
October 2014, the management has decided to have in-house
embroidery facility to limit its reliance on third party.
KWALITY FOUNDRY: CRISIL Suspends B Rating on INR70MM Cash Loan
--------------------------------------------------------------
CRISIL has suspended its ratings on the bank facilities of
Kwality Foundry Industries (KFI).
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Bank Guarantee 20 CRISIL A4
Cash Credit 70 CRISIL B/Stable
Letter of Credit 10 CRISIL B/Stable
The suspension of ratings is on account of non-cooperation by KFI
with CRISIL's efforts to undertake a review of the ratings
outstanding. Despite repeated requests by CRISIL, KFI is yet to
provide adequate information to enable CRISIL to assess KFI'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 1978-79, KFI is a part of the Vaswani group. The
firm manufactures ingots from scrap, manhole covers, and pipes and
fittings by using pig iron and cast iron scrap. KFI also
occasionally trades in pig iron. The firm has a manufacturing unit
in Raipur (Chhattisgarh) with total manufacturing capacity of
12,000 tonnes per annum, which is being operated at full capacity.
LATHANGI MOTORS: CRISIL Assigns 'B' Rating to INR135MM Loan
-----------------------------------------------------------
CRISIL has assigned its 'CRISIL B/Stable' rating to the long-term
bank facilities of Lathangi Motors Pvt Ltd (LMPL).
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Channel Financing 135 CRISIL B/Stable
Term Loan 85 CRISIL B/Stable
The rating reflects LMPL's weak financial risk profile, marked by
a modest net worth, high external indebtedness, and subdued debt
protection metrics. The rating also factors in the company's
working-capital-intensive operations and the susceptibility of its
operating performance to intense competition in the automotive
dealership industry. These rating weaknesses are partially offset
by the extensive experience of LMPL's promoters in the auto
dealership industry and their established relationship with its
principal, Ford India Pvt Ltd (Ford).
Outlook: Stable
CRISIL believes that LMPL will benefit from the extensive industry
experience of its promoters and their established relationship
with Ford. The outlook may be revised to 'Positive' if the company
records a significant increase in revenue while it maintains its
profitability, or if there is substantial equity infusion,
resulting in an improvement in its financial risk profile.
Conversely, the outlook may be revised to 'Negative' if the
company reports low cash accruals, or its working capital
management deteriorates, leading to deterioration in its financial
risk profile, particularly its liquidity.
Incorporated in 2008, LMPL is an authorised dealer of passenger
vehicles and spare parts of Ford. The company, promoted and
managed by Mr. MP Vikram Shetty, operates one showroom and three
service centres in Bengaluru.
LMPL reported a profit after tax of INR6 million on an operating
income of INR904.4 million for 2013-14 (refers to financial year,
April 1 to March 31), as against a net profit of INR2.9 million on
an operating income of INR800 million in 2012-13.
LOKNETE HONOURABLE: CRISIL Suspends 'D' Rating on INR187.4MM Loan
-----------------------------------------------------------------
CRISIL has suspended its rating on the bank facilities of Loknete
Honourable Hanmantrao Patil Charitable Trust, Vita.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Rupee Term Loan 187.4 CRISIL D
The suspension of ratings is on account of non-cooperation by
Loknete with CRISIL's efforts to undertake a review of the ratings
outstanding. Despite repeated requests by CRISIL, Loknete is yet
to provide adequate information to enable CRISIL to assess
Loknete'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'
Loknete, set up in 1994, runs multiple educational institutes
including primary and secondary schools, degree and diploma
engineering college, and arts and commerce colleges at Vita in
Sangli (Maharashtra).
MAA SARASWATI: ICRA Suspends B- Rating on INR14.50cr LT Loan
------------------------------------------------------------
ICRA has suspended the long term rating of [ICRA]B- and short term
rating of [ICRA]A4 assigned to the INR14.78 crore bank facilities
Maa Saraswati Steel Re-Rolling Mills Private Limited. The
suspension follows ICRA's inability to carry out a rating
surveillance in the absence of the requisite information from the
company.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long term, Fund
Based Facilities 14.50 [ICRA]B- suspended
Short term, Non
Fund Based Facilities 0.28 [ICRA]A4 Suspended
Incorporated in 1990, "Saraswati Steel Industries" as partnership
firm by Mr. Rakeshkumar Gupta. Later on in April 2011, the legal
structure of the firm has changed to Private Limited under the
name of "Maa Saraswati Steel Re-rolling Mills Pvt Ltd" (MSSRM).
The company is engaged in the manufacturing of steel bars in
various sizes ranges from 8 mm to 25 mm and markets product under
the name of Sarawati Thermex 500.
MAHESHWARI TECHNOCAST: CRISIL Assigns B Rating to INR30MM Loan
--------------------------------------------------------------
CRISIL has assigned its 'CRISIL B/Stable/CRISIL A4' ratings to the
bank facilities of Maheshwari Technocast Ltd (MTL).
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Term Loan 19 CRISIL B/Stable
Letter of Credit 10 CRISIL A4
Bank Guarantee 1 CRISIL A4
Cash Credit 30 CRISIL B/Stable
The ratings reflect MTL's modest scale of operations, its exposure
to risks related to the highly fragmented and competitive steel
industry, leading to a modest operating margin, and its working-
capital-intensive nature of operations, resulting in weak
liquidity. These rating weaknesses are partially offset by the
extensive industry experience of the company's promoters and its
moderate order book, given its scale of operations.
Outlook: Stable
CRISIL believes that MTL will continue to benefit over the medium
term from the extensive industry experience of its promoters. The
outlook may be revised to 'Positive' if MTL's liquidity improves
significantly, most likely because of capital infusion and a
substantial increase in its revenue and profitability. Conversely,
the outlook may be revised to 'Negative' if the company's
profitability or revenue declines, resulting in subdued cash
accruals, or if it undertakes a large debt-funded capital
expenditure programme.
MTL, promoted by Mr. Suresh Kumar Mantri, was originally
established as a partnership firm in 1974; the firm was
reconstituted as a limited company in 1996. The company
manufactures rolling mill spare parts as per the specifications
provided by clients. Its manufacturing facility, which primarily
consists of a foundry, is in Bhilai (Chhattisgarh).
NOOR IMPEX: CRISIL Lowers Rating on INR55MM Cash Credit to 'C'
--------------------------------------------------------------
CRISIL has downgraded its rating on the long-term bank facilities
of Noor Impex Pvt Ltd (NIPL) to 'CRISIL C' from 'CRISIL B-/Stable;
while reaffirming the short-term rating at 'CRISIL A4'.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 55 CRISIL C (Downgraded from
'CRISIL B-/Stable')
Letter of Credit 75 CRISIL A4 (Reaffirmed)
The rating downgrade reflects over utilization by NIPL in cash
credit account marked by weak liquidity position. NIPL has weak
liquidity because of its large working capital requirements due to
stretch in its book debts. CRISIL believes that NIPL's liquidity
will remain weak over the medium term because of its working-
capital-intensive operations marked by long receivables cycle and
negative cash flows from operations.
The rating reflects NIPL's stretched liquidity as a result of
increased working capital requirements with revenue growth, while
tying up of adequate funds has generally lagged growth in revenue.
However, the company benefits from the extensive experience of its
promoters in the timber industry.
Initially set up as a sole proprietorship concern, Noorani Saw
Mill, NIPL was reconstituted as a private limited company and
acquired its current name in 2010. It is promoted by the members
of the Latiwala family. The company imports timber from New
Zealand, Malaysia, and the US. Its promoters have been in the
timber-trading industry since the past five decades. NIPL has six
sawing mills at its Gandhidham (Gujarat) facility.
NIPL reported profit after tax (PAT) of INR0.4 million on net
sales of INR302.8 million in 2013-14 (refers to financial year,
April 1 to March 31) as against PAT of INR0.4 million on net sales
of INR256.7 million for 2012-13.
OXFORD GOLF: CRISIL Lowers Rating on INR1.25BB LT Loan to 'D'
-------------------------------------------------------------
CRISIL has downgraded its rating on the bank facility of
Oxford Golf and Resorts Pvt Ltd (Oxford) to 'CRISIL D' from
'CRISIL B-/Stable'.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Proposed Long Term 1250 CRISIL D (Downgraded from
Bank Loan Facility 'CRISIL B-/Stable')
The downgrade reflects instances of delay by Oxford in servicing
its debt. The delays have been caused by weakening in Oxford's
liquidity, with insufficient cash accruals to meet its interest
obligations.
Oxford has a below-average financial risk profile, marked by small
net worth, high gearing, and weak debt protection metrics.
However, the company benefits from its promoters' extensive
experience in the hospitality and real estate industry.
Oxford was constituted as a partnership firm in 2005-06 (refers to
financial year, April 1 to March 31) and incorporated as a private
limited company in 2009-10; the company is developing an
integrated tourism and leisure project at Pune (Maharashtra). The
company is promoted by Mr. Anirudha U Seolekar and Mr. Ashok
Kothari. The project includes a golf course, golf academy, sports
centre, luxury resort, time-share apartments, a spa, and other
recreational amenities. The project is spread over 134 acres. The
overall cost of the project is around INR2.17 billion, of which
INR1.11 billion has been expended till date. The Oxford group has
business interests in hospitality and real estate development. The
group is primarily engaged in the development of residential,
commercial, and hospitality properties in Pune. The group owns and
operates 5-star hotels under the brand, The Hotel O, in Goa and
Pune. The group has developed property of 3 million square feet.
Oxford reported a net loss of INR11.9 million on net sales of
INR121.4 million for 2013-14, against a net loss of INR4.9 million
on net sales of INR74.0 million for 2012-13.
PARTH FOILS: ICRA Suspends 'D' Rating on INR54.38cr Term Loan
-------------------------------------------------------------
ICRA has suspended [ICRA]D rating to the INR54.38 crore term
loans; INR21.0 crore long term, fund based limits and the [ICRA]D
rating to the INR13.25 crore, short term, non-fund based bank
facilities and INR1.37 crore unallocated bank facilities of
Parth Foils Private Pvt. Ltd. The suspension follows ICRA's
inability to carry out a rating surveillance in the absence of the
requisite information from the company.
RANA MILK: Ind-Ra Assigns 'IND BB' Long-Term Issuer Rating
----------------------------------------------------------
India Ratings and Research (Ind-Ra) has assigned Rana Milk Foods
Private Limited (RMFPL) a Long-Term Issuer Rating of 'IND BB'. The
Outlook is Stable. Ind-Ra has also assigned RMFPL's INR190m fund-
based working capital facility at Long-Term 'IND BB' rating with a
Stable Outlook and Short-Term 'IND A4+' rating.
KEY RATING DRIVERS
The ratings reflect RMFPL's moderate scale of operations, moderate
credit metrics and tight liquidity position due to its presence in
the intensely competitive food industry. According to the
provisional financials for FY15 (year ended March), overall
revenue was INR1,212.44m, gross coverage (operating EBITDA/gross
interest expense) was 1.57x, net leverage (total adjusted
debt/operating EBITDAR) was 6.46x and EBITDA margin were 3.68%.
The ratings, however, benefit from the over three-decade-long
experience of RMFPL's promoters in the same industry and the
company's 11-year-long operational history. The ratings are
further supported by the company's strong relationship with its
customers and suppliers.
RATING SENSITIVITIES
Negative: Sustained deterioration in the credit profile could lead
to a negative rating action.
Positive: A substantial improvement the scale of operation and
operating profitability while maintaining the credit metrics will
be positive for the ratings.
COMPANY PROFILE
RMFPL was established in 2005. RMFPL is into milk processing and
manufacturing of milk products such as ghee, milk powder and white
butter. RMFPL's processing facility is located in Samrala, Punjab.
It supplies products under Royal brand.
RUKMANI IMPEX: CRISIL Assigns 'D' Rating to INR150MM Term Loan
--------------------------------------------------------------
CRISIL has assigned a rating of 'CRISIL D' on the long term bank
facilities of Rukmani Impex Private Limited (RIPL). The rating
reflects instances of delay by RIPL in servicing its term debt
obligation; the delays were caused by the company's weak liquidity
resulting from its nascent stages of operations.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 50 CRISIL D
Term Loan 150 CRISIL D
RIPL is also exposed to risks pertaining to its initial stages of
operations in the fragmented cashew processing segment. However,
the company benefits from the diverse entrepreneurial experience
of its promoters.
RIPL was incorporated in 2011 by Mr. Umesh Agrawal and Mr. Sunny
Agrawal. The company is engaged in manufacture and processing of
cashew nuts. The company's processing unit at Jalna commenced
operations from August 2014. Mr. Umesh Agarwal looks after the day
to day operations of the company. The registered office of the
company is located in Jalna, Maharashtra.
SAM APPARELS: ICRA Upgrades Rating on INR2.50cr Loan to B+
----------------------------------------------------------
ICRA has upgraded its long term rating on the INR2.50 crore
(reduced from INR10.00 crore) long term limits of Sam Apparels Pvt
Ltd to [ICRA] B+ from [ICRA]B. ICRA has reaffirmed its rating on
the INR27.50 crore (increased from INR26.00 crore) short term
facilities of SAPL at [ICRA] A4.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Fund Based Working
Capital Limits 27.50 [ICRA] A4; Reaffirmed
Unallocated 2.50 [ICRA] B+; Upgraded
The rating upgrade is driven by the expectation of an improvement
in SAPL's scale, subsequent to the receipt of a large order by the
company, from an importer for Walmart in Q1, FY16. This follows
successful vendor audit and sampling trials in FY15. SAPL's scale
is expected to register improvement thereby helping the company
achieve better economies of scale, as the required production
infrastructure is already in place, and would likely lead to
improvement in profitability and coverage indicators. Moreover,
with the complete repayment of SAPL's previously outstanding long
term debt and no major debt raising plans, SAPL's debt service
coverage ratio (DSCR) is also expected to significantly improve in
the near term. The ratings continue to favorably factor in the
experience of SAPL's promoters in the business and their
relationships with various garment retail chains, which results in
revenue diversity. However, the ratings are constrained by the
competitive nature of the industry as reflected in the company's
OPBDITA margins, which declined in FY15 to 7.3% from 8.4% in FY14,
and exposure to forex fluctuation risks. The ratings also factor
in SAPL's substantial working capital requirements and its
consequent dependence on bank limits, resulting in their full
utilization.
Going forward, SAPL's ability to attain revenue growth and
register a sustained improvement in its operating margins while
maintaining a satisfactory liquidity position will be the key
rating sensitivities.
SAPL is engaged in the manufacture and exports of readymade
garments for women and kids to countries like Brazil, Italy,
Chile, Canada, USA etc. The company is managed by Mr. Mukesh
Sharma and Mr. Ved Prakash Sachdev, and has an installed garment
manufacturing capacity of ~72 lakh pieces annually, in its
facilities based in Noida, Uttar Pradesh.
Recent Results
In FY15, on a provisional basis, SAPL reported an Operating Income
(OI) of INR87.9 crore and a Profit After Tax (PAT) of INR0.8
crore, as against an OI of INR85.0 crore and a PAT of INR0.7 crore
in the previous year.
SANTHIRAM WIND: CRISIL Assigns 'B' Rating to INR75MM LT Loan
------------------------------------------------------------
CRISIL has assigned its 'CRISIL B/Stable' rating to the long-term
bank facility of Santhiram Wind Power Pvt Ltd (SWPPL).
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Long Term Loan 75 CRISIL B/Stable
The rating reflects SWPPL's nascent stage of operations, modest
liquidity, with maintenance of debt service reserve account (DSRA)
of three months of interest and principal obligations on its bank
debt; the rating also factors in SWPPL's exposure to variability
in long-term wind speeds, and to risks related to customer
concentration in revenue profile. These rating weaknesses are
partially offset by SWPPL's healthy revenue visibility aided by
long-term power purchase agreement (PPA), its moderate debt
service coverage ratio and the benefits derived from need based
fund support from promoters.
Outlook: Stable
CRISIL believes that SWPPL will continue to benefit over the
medium term from its stable cash accruals backed by its PPA. The
outlook may be revised to 'Positive' if SWPPL's plant load factor
(PLF) consistently exceeds CRISIL's expectation or if the company
maintains larger-than-expected DSRA, resulting in improvement in
its liquidity. Conversely, the outlook may be revised to
'Negative' if SWPPL reports low cash accruals, most likely because
of low PLF, or undertakes any large debt-funded capital
expenditure programme, weakening its financial risk profile.
Incorporated in June 2013, SWPPL generates wind energy. The
company operates a windmill with capacity of 2 megawatts at
Vajrakarur in Ananthpur (Andhra Pradesh). The company is promoted
by Mr. P Ravi Babu and Mrs. M Madhavilatha.
SARADA STARCH: CRISIL Suspends 'D' Rating on INR190MM Term Loan
---------------------------------------------------------------
CRISIL has suspended its ratings on the bank facilities of
Sarada Starch and Chemicals Pvt Ltd (SSCPL).
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Bank Guarantee 10 CRISIL D
Term Loan 190 CRISIL D
The suspension of ratings is on account of non-cooperation by
SSCPL with CRISIL's efforts to undertake a review of the ratings
outstanding. Despite repeated requests by CRISIL, SSCPL is yet to
provide adequate information to enable CRISIL to assess SSCPL'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 February 2009, SSCPL is promoted by the Agarwal
family and the MLA group. The company manufactures starch and
glucose at its plant in Malda (West Bengal).
SHREE KRISHNA: CRISIL Suspends 'D' Rating on INR115MM LT Loan
-------------------------------------------------------------
CRISIL has suspended its rating on the bank facilities of Shree
Krishna Poly Strap Pvt Ltd (SKPL).
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 65 CRISIL D
Long Term Loan 115 CRISIL D
The suspension of ratings is on account of non-cooperation by SKPL
with CRISIL's efforts to undertake a review of the ratings
outstanding. Despite repeated requests by CRISIL, SKPL is yet to
provide adequate information to enable CRISIL to assess SKPL'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'
SKPL was set up in 2009 by Mr. Aruvela Ramesh. The company
manufactures polypropylene and polyethylene terephthalate (PET)
strappings, which are used as a versatile packaging material
across industries such as textiles, steel, beverages, paper,
ceramics, and construction. Its manufacturing facility is in
Chittur (Andhra Pradesh).
SHRI BIJASANI: CRISIL Reaffirms B Rating on INR70MM Cash Loan
-------------------------------------------------------------
CRISIL's rating on the long-term bank facilities of Shri Bijasani
Cotton Fiber (SBCF) continues to reflect SBCF'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 70 CRISIL B/Stable (Reaffirmed)
Proposed Cash
Credit Limit 12.5 CRISIL B/Stable (Reaffirmed)
Proposed Long Term
Bank Loan Facility 32.5 CRISIL B/Stable (Reaffirmed)
Term Loan 15 CRISIL B/Stable(Reaffirmed)
The rating also factors in the firm's vulnerability to volatility
in raw material prices, and its small scale of operations in the
intensely competitive cotton ginning industry. These rating
weaknesses are partially offset by the extensive industry
experience of SBCF's partners.
Outlook: Stable
CRISIL believes that SBCF will continue to benefit over the medium
term from its partners' extensive experience in the cotton ginning
industry. The outlook may be revised to 'Positive' if the firm
sustains a healthy improvement in its profitability, leading to
better debt protection metrics. Conversely, the outlook may be
revised to 'Negative' if SBCF's financial risk profile
deteriorates, most likely because of sizeable working capital
requirements or lower-than-anticipated net cash accruals.
SBCF was set up in May 2012 as a partnership firm by Mr. Bharat
Goyal and Mr. Sandeep Goyal. The firm has a plant in Barwani
(Madhya Pradesh) for ginning and pressing of raw cotton into
cotton bales.
SBCF reported a net profit of INR2.2 million on net sales of
INR451 million for 2013-14 (refers to financial year, April 1 to
March 31), against a net profit of INR1.6 million on net sales of
INR148 million for 2012-13.
SRI BALAMBIKA: CRISIL Cuts Rating on INR250MM Cash Loan to B+
-------------------------------------------------------------
CRISIL has downgraded its ratings on the bank facilities of
Sri Balambika Textile Mills Pvt Ltd (SBTMPL) to 'CRISIL
B+/Stable/CRISIL A4' from 'CRISIL BB-/Stable/CRISIL A4+'.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Bank Guarantee 15.5 CRISIL A4 (Downgraded from
'CRISIL BB-/Stable')
Cash Credit 250 CRISIL B+/Stable (Downgraded
from 'CRISIL A4+')
Letter of Credit 10 CRISIL A4 (Downgraded from
'CRISIL BB-/Stable')
Term Loan 180 CRISIL B+/Stable (Downgraded
from 'CRISIL BB-/Stable')
The rating downgrade reflects CRISIL's belief that SBTMPL's
liquidity will remain weak over the medium term, marked by tightly
matched cash accruals against debt obligations. The company is
expected to post cash accruals of around INR87 million in 2015-16
(refers to financial year, April 1 to March 31), against debt
obligations of INR85 million. The downgrade also factors in
CRISIL's belief that SBTMPL's operating performance would remain
weak over the medium term due to muted demand from its customers;
the company's revenue declined by about 21 per cent in 2014-15.
The ratings reflect SBTMPL's below-average financial risk profile,
marked by high gearing and weak debt protection metrics, and the
company's exposure to volatility in cotton prices. These rating
weaknesses are partially offset by the extensive experience of
SBTMPL's promoter in the textile industry.
Outlook: Stable
CRISIL believes that SBTMPL will continue to benefit over the
medium term from its established market position and its
promoter's extensive industry experience. The outlook may be
revised to 'Positive' if the company's liquidity and capital
structure improve significantly and sustainably, supported by
large cash accruals. Conversely, the outlook may be revised to
'Negative' if SBTMPL undertakes a large debt-funded capital
expenditure programme, or reports a significant decline in its
revenue or profitability.
SBTMPL spins cotton yarn, and has a factory in Tiruppur (Tamil
Nadu). The company also has two windmills with a combined power
generation capacity of 1.2 megawatt. SBTMPL is promoted by Mr. M
Rathnasamy.
SRI SAI: CRISIL Reaffirms 'B' Rating on INR80MM Cash Credit
-----------------------------------------------------------
CRISIL's rating on the long-term bank facility of Sri Sai Aarush
Trade Links (SSATL) continues to reflect SSATL's modest scale of
operations in the intensely competitive and highly fragmented
cotton trading industry, and its below-average financial risk
profile, marked by small net worth, high total outside liabilities
to tangible net worth ratio, and weak debt protection metrics.
These rating weaknesses are partially offset by the extensive
experience of the firm's promoters in the cotton industry.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 80 CRISIL B/Stable (Reaffirmed)
Outlook: Stable
CRISIL believes that SSATL will continue to benefit over the
medium term from its promoters' extensive industry experience. The
outlook may be revised to 'Positive' if there is a substantial and
sustained improvement in the firm's revenue and profitability
margins, or there is a significant improvement in its capital
structure or net worth on the back of sizeable equity infusion by
its promoters. Conversely, the outlook may be revised to
'Negative' in case of a steep decline in the firm's profitability
margins, or significant deterioration in its working capital
management, most likely due to a stretch in its receivables cycle.
Set up in 2013, SSATL trades in raw cotton and cotton lint. The
firm is promoted by Mr. N Nageswara Rao and his wife, Ms. N
Padmavathy. It is based in Vijayawada (Andhra Pradesh).
SRI TEJA: CRISIL Reaffirms 'D' Rating on INR450MM LT Loan
---------------------------------------------------------
CRISIL's rating on the long-term bank facilities of Sri Teja Bio
Fuels Pvt Ltd continues to reflect instances of delays by Sri Teja
in servicing its debt; the delays have been caused by the
company's weak liquidity.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Long Term Loan 450 CRISIL D (Reaffirmed)
Proposed Cash
Credit Limit 80 CRISIL D (Reaffirmed)
Sri Teja is also exposed to risks related to stabilisation and
commercialisation of its recently commenced distillery project,
and to the regulated nature of the liquor industry. The company,
however, benefits from the healthy demand for grain-based extra
neutral alcohol (ENA).
Sri Teja was promoted in 2006 by Mr. Murali Krishna Reddy Kanumuru
and associates. The company operates a grain-based distillery that
produces ENA in West Godavari district in Andhra Pradesh.
SUPREME VASAI: Ind-Ra Cuts Senior Project Loans Rating to IND BB+
-----------------------------------------------------------------
India Ratings and Research (Ind-Ra) has downgraded Supreme Vasai
Bhiwandi Tollways Private Limited's (SVBTPL) INR1,540 million
(outstanding: INR1,510 million on March 31, 2015) long-term senior
project loans to 'IND BB+' from 'IND BBB+'. The Outlook is Stable.
KEY RATING DRIVERS
The three-notch downgrade reflects a steep fall in SVBTPL's toll
revenue to about 23% below Ind-Ra's expectations in FY15, mainly
due to a 27% decline in the traffic from FY14. Since 90% of the
traffic includes commercial vehicles, a slow economic recovery
might be the plausible reason for the decline in traffic. The
actual revenue dipped 12% yoy to average daily revenue of INR0.73m
in FY15.
The rating also factors in the deteriorating credit profile of the
ultimate parent - Supreme Infrastructure India Limited (SIIL; 'IND
BB'/Negative) and its consequent, imminent inability to support
the project, should the need arise. The rating is constrained by
the possible diversion of cash from this SPV to other associate
SPVs and/or the sponsors, considering the financial stress of SIIL
and the group's other companies.
The project has a revenue sharing mechanism. According to the
provisions of the concession agreement, 50% of the difference
between revenue numbers submitted at the time of bidding and
actual revenue numbers will be shared with Public Works
Department, the government of Maharashtra. However, according to
the base case projections, the said provision is unlikely to come
into effect over the concession life given the drop in revenue
performance.
The toll rates are based on pre-determined rates (for the entire
concession period) specified in the concession agreement and are
subject to increase every three years. Unlike most concessions by
the National Highway Authority of India ('IND AAA'/Stable), the
toll rates are not linked to inflation which limits the
uncertainty related to macroeconomic inflation rate movements and
thus mitigates revenue (price) risk.
The project is exposed to a variable interest rate (annual
resets). The debt amortisation commenced from January 2014 and
will be repaid in 135 structured monthly instalments till March
2025. Similar to most other infrastructure assets, the
amortisation is heavily back ended; over 70% of the debt is likely
to be amortised in the last four years of the tenor. Debt service
reserve account of INR22 million (two months' debt servicing) has
been created, which is a rating positive.
PROJECT PROFILE
SVBTPL is an SPV acquired by Supreme Infra BOT Private Limited in
October 2013. Supreme Infra BOT is a 100% subsidiary of SIIL and
the holding company of the Supreme Group for its build-operate-
transfer projects. SVBTPL has taken over the concession and toll
collection rights of the 26.425km road in Maharashtra. This was
through the execution of a concession agreement among the Public
Works Department, the government of Maharashtra, lenders'
consortium and the concessionaire, after the erstwhile
concessionaire failed to meet the obligations under the
agreements. The total project cost of INR2,140m is being financed
by debt of INR1,540m debt and the remaining by equity.
RATING SENSITIVITIES
Sustained traffic performance meeting base case projections could
result in a rating upgrade. Conversely, any material traffic
underperformance or higher-than-expected operating expenses and/or
any cash diversion from the SPV could lead to a negative rating
action.
SWAPNA MOTORS: CRISIL Lowers Rating on INR140MM Cash Loan to B+
---------------------------------------------------------------
CRISIL has downgraded its rating on the long-term bank facilities
of Swapna Motors Pvt Ltd (SMPL) to 'CRISIL B+/Stable' from 'CRISIL
BB/Stable'.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 140 CRISIL B+/Stable (Downgraded
from 'CRISIL BB/Stable')
Term Loan 49 CRISIL B+/Stable (Downgraded
from 'CRISIL BB/Stable')
The rating downgrade reflects deterioration in SMPL's business
risk profile and liquidity. The company's turnover in 2014-15
(refers to financial year, April 1 to March 31) remained flat,
around INR631 million, because of lower sales and few launches by
its principal Tata Motors Ltd (TML). SMPL's profitability,
however, declined during 2014-15 with expected profit after tax at
around INR5 million, leading to lower cash accruals of INR13.3
million, and consequently, leading to cash flow mismatches with
repayment obligations of around INR16 million. Going forward the
cash accruals are expected to improve over the medium term,
however the same will remain low. The company's liquidity remains
stretched with high bank limit utilisation of 97 per cent on an
average during the 12 months through May 2015. Moreover, the
company has been using accruals to fund capital expenditure
(capex), leading to additional pressure on its already strained
liquidity. Improvement in liquidity backed by infusion of funds
from promoters will remain a key rating sensitivity factor.
The ratings reflect SMPL's low bargaining power with its principal
and exposure to intense competition in the automotive dealership
market and its weak financial risk profile, especially liquidity.
These weaknesses are partially offset by extensive experience of
SMPL's promoters, the company's established position, in the
automobile dealership market in Odisha.
Outlook: Stable
CRISIL believes that SMPL will continue to benefit over the medium
term from its established market position in Odisha. The outlook
may be revised to 'Positive' in case of substantial increase in
the company's operating income and profitability, or in its
capital structure because of sizeable capital infusion by its
promoters, leading to improved liquidity. Conversely, the outlook
may be revised to 'Negative' if SMPL's financial risk profile
deteriorates, most likely due to large debt-funded capex, low cash
accruals, or increase in inventory.
Incorporated in 2000, SMPL is an authorised dealer of passenger
cars and utility vehicles of TML in Odisha, with an integrated
facility in Bhubaneswar. The company is managed by its promoter,
Mr. Badri Narayan Saha.
U.P ASBESTOS: CRISIL Cuts Rating on INR320MM Cash Loan to B-
------------------------------------------------------------
CRISIL has downgraded its rating on the long-term bank facilities
of U.P Asbestos Ltd (UPAL) to 'CRISIL B-/Stable' from 'CRISIL
B+/Stable', while reaffirming its rating on the company's short-
term bank loan facility at 'CRISIL A4'.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Bank Guarantee 8 CRISIL A4 (Reaffirmed)
Buyer Credit Limit 100 CRISIL B-/Stable (Downgraded
from 'CRISIL B+/Stable')
Cash Credit 320 CRISIL B-/Stable (Downgraded
from 'CRISIL B+/Stable')
Term Loan 252 CRISIL B-/Stable (Downgraded
from 'CRISIL B+/Stable')
The rating downgrade reflects CRISIL's belief that UPAL's
liquidity will remain weak over the medium term, with continued
high dependency on bank borrowings on account of large working
capital requirements leading to fully utilised bank lines.
Furthermore, the company's accruals are expected to be tightly
matched against its term debt repayment obligations of around
INR70 million per annum. UPAL's working capital requirements are
expected to remain stretched due to large inventory and debtors.
Moreover, its working capital bank lines have been reduced to
INR250 million from INR320 million since June 2014 as it leased
out of its factory in Dadri (Uttar Pradesh) due to low demand.
UPAL's sales and profitability are expected to remain constrained
on account of weak demand owing to expectation of a poor monsoon
(major market being rural areas). Its liquidity is partially
supported by unsecured loans of around INR66 million from its
promoters as on March 31, 2015. The timeliness and extent of
funding support from promoters will remain key rating sensitivity
factors over the medium term.
The ratings reflect UPAL's weak financial risk profile, marked by
high gearing and weak debt protection metrics, and its
vulnerability to volatility in raw material prices and to intense
competition in the asbestos cement (AC) sheets industry. These
rating weaknesses are partially offset by the company's
comfortable share in the AC sheets market, supported by its wide
marketing network. The ratings also factor in the industry
experience of UPAL's promoters.
Outlook: Stable
CRISIL believes that UPAL will continue to benefit over the medium
term from its promoters' extensive industry experience. The
outlook may be revised to 'Positive' if the company significantly
improves its net cash accruals or its financial risk profile,
while prudently managing its working capital requirements.
Conversely, the outlook may be revised to 'Negative' if UPAL's
revenue and profitability decline, resulting in low cash accruals,
or if it undertakes a large debt-funded capital expenditure
programme, weakening its liquidity.
UPAL, incorporated in 1974, manufactures AC sheets. Its management
team is headed by Mr. Amitabh Tayal, who has been associated with
the company since 1983; Mr. Tayal gained management control over
UPAL in 1994 after buying it from the Times of India group. UPAL
has four manufacturing facilities in Lucknow and Dadri. It has a
capacity to manufacture 180,000 tonnes of AC sheets per annum.
UPAL has leased out its Dadri unit since February 2014.
UTTAR BHARAT: ICRA Suspends 'B' Rating on INR134cr LT Loan
----------------------------------------------------------
ICRA has suspended [ICRA]B rating assigned to the INR134 crore,
long term loans of Uttar Bharat Hydro Power Pvt Ltd. The
suspension follows ICRA's inability to carry out a rating
surveillance in the absence of the requisite information from the
company.
VIBRANT CONSTRUCTION: CRISIL Rates INR20MM Cash Credit at B+
------------------------------------------------------------
CRISIL has assigned its 'CRISIL B+/Stable/CRISIL A4' ratings to
the bank facilities of Vibrant Construction Pvt Ltd (VCPL).
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Bank Guarantee 100 CRISIL A4
Cash Credit 20 CRISIL B+/Stable
The ratings reflect VCPL's above-average financial risk profile,
marked by low gearing and strong debt protection metrics. The
ratings also factor in the extensive experience of the company's
promoters in the civil construction industry. These rating
strengths are partially offset by VCPL's small scale of operations
in a highly fragmented industry, geographic concentration in its
revenue profile, and its working-capital-intensive operations.
Outlook: Stable
CRISIL believes that VCPL will continue to benefit over the medium
term from its promoters' extensive industry experience. The
outlook may be revised to 'Positive' if the company significantly
improves its scale of operations and operating profitability,
leading to a substantial increase in its cash accruals, or if its
promoters infuse considerable equity, resulting in improvement in
its financial risk profile. Conversely, the outlook may be revised
to 'Negative' if VCPL's operating margin and topline decline, or
its financial risk profile, particularly its liquidity,
deteriorates, most likely because of large debt-funded capital
expenditure or a stretch in its working capital cycle.
Established in 2003, VCPL is promoted by Ahmedabad (Gujarat)-based
Mr. Ajay Agarwal and his family members. The company undertakes
civil contract works mainly for construction of reinforced
concrete cement (RCC) roads, water supply and drainage systems,
and road-side pavements.
VCPL, on a provisional basis, reported a profit after tax (PAT) of
INR2.47 million on net sales INR51.2 million for 2014-15 (refers
to financial year, April 1 to March 31); it had reported a PAT of
INR1.73 million on net sales of INR42.67 million for 2013-14.
VIJAYALAKSHMI SPINTEX: ICRA Reaffirms B+ Rating on INR18cr Loan
---------------------------------------------------------------
ICRA has reaffirmed the [ICRA]B+ rating assigned to the INR25.42
crore fund based limits and INR0.25 crore non-fund based limits of
Vijayalakshmi Spintex Limited.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Cash Credit 18.00 [ICRA]B+; reaffirmed
Term Loan 7.42 [ICRA]B+; reaffirmed
Bank Guarantee 0.25 [ICRA]B+; reaffirmed
The rating reaffirmation constrained by the stretched liquidity
position of the company as indicated by high working capital
utilization over the last 12 months due to high inventory levels
of the company; moderate financial risk profile of the firm
indicated by high gearing level of 2.19 times as on 31st March,
2015, modest coverage indicators as indicated by OPBITDA-to-
Interest & Finance Charges of 2.25x and Net Cash Accrual-to-Total
Debt of 14% for FY15. The rating continues to be constrained by
the modest scale of operations, presence in a highly fragmented
and competitive industry which limits the company ability to pass
on the hike in input costs and exposure to regulatory risks with
regards to minimum support price for raw cotton.
The rating, however, takes into account the decade long experience
of promoters in the industry; fully integrated nature of
operations with presence in both ginning of raw cotton and
spinning of cotton lint. The ratings are further benefitted by the
fiscal incentives received by the government such as low power
tariff, TUFS subsidy and state subsidy.
Going forward, the ability of the company to increase its scale of
operations while managing its working capital requirements will be
the key rating sensitivities.
VSL has its spinning unit at Nalgonda District in Andhra Pradesh;
it had set up initially a 12096 spindles and was subsequently
upgraded to 19152 spindles in FY11. During FY13, the company added
another 8332 spindles and presently, the company has 27484
spindles with auto coners, combers and ginning unit. The company
also has ginning unit which has a capacity of 170 bales per day in
2008. This was increased to 330 bales/day in October 2009. It also
has a cotton seed oil mill.
According to provisional FY15 financials, the company registered
an operating income of INR93.72 Cr and net profit of INR0.79 Cr as
compared to operating income of INR90.77 Cr and net profit of
INR0.45 Cr. during FY14.
VIJAYKIRAN EDUCATIONAL: CRISIL Suspends B+ Rating on INR380M Loan
-----------------------------------------------------------------
CRISIL has suspended its rating on the bank facilities of
Vijaykiran Educational Trust (VET; part of the VK group).
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Long Term Loan 380 CRISIL B+/Stable
The suspension of ratings is on account of non-cooperation by VET
with CRISIL's efforts to undertake a review of the ratings
outstanding. Despite repeated requests by CRISIL, VET is yet to
provide adequate information to enable CRISIL to assess VET'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'
For arriving at its rating, CRISIL has combined the business and
financial risk profiles of VET and VK Academy of Education Pvt Ltd
(VKA). This is because both entities together referred to as the
VK group operate in the education sector, from the same campus,
and have a common management.
VET was established in Bengaluru in 2003. The trust is promoted by
Mr. N Vijaya Kumar and his wife, Mrs. Padmini Vijaya Kumar. VET
runs a co-educational, day school named National Centre of
Excellence (NCFE) in Bengaluru, which is affiliated to the Central
Board of Secondary Education (CBSE). The group is also setting up
an international school. In 2003, the promoters also established
VKA to setup a kindergarten pre-school named Early Foundation.
Both Early Foundation and NCFE operate from the same campus. The
schools are located in Malleshpalya, and cater to families
residing in Indiranagar, Domlur, Kaggadasapura, C V Raman Nagar,
BTM Layout and surrounding areas.
YANTRA GREEN: CRISIL Lowers Rating on INR311.9MM LT Loan to 'D'
---------------------------------------------------------------
CRISIL has downgraded its rating on the long-term bank facility of
Yantra Green Power Pvt Ltd (YGP) to 'CRISIL D' from 'CRISIL
B+/Stable'.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Long Term Loan 311.9 CRISIL D (Downgraded
from 'CRISIL B+/Stable')
The rating downgrade reflects instances of delay by YGP in
servicing its debt. The delays have been caused by weakening of
the company's liquidity because of delay in commencement of its
project.
YGP is exposed to risks related to implementation and
stabilisation of its power generation project. The company also
has a weak financial risk profile marked by small net worth and
high gearing. However, the company will benefit from the assured
offtake agreement with Vivimed Labs Ltd.
YGP was set up in 2012 by Vivimed Labs Ltd, BBR Projects Pvt Ltd,
Mr. Santosh Varalwar, and Mr. Sandeep Varalwar. The company is
setting up a 5-megawatt solar photovoltaic-based power plant in
Hyderabad. The plant is expected to commence operations in October
2015.
=========
J A P A N
=========
SKYMARK AIRLINES: Delta Japan Chief Sets Out Benefits of Alliance
-----------------------------------------------------------------
Jiji Press reports that Masaru Morimoto, head of Delta Air Lines'
Japanese unit, has said the U.S. carrier plans to play a major
role in the rehabilitation of Skymark Airlines by advising it in
areas such as customer service.
"Skymark can better vie with Japan Airlines and All Nippon Airways
if it joins the Delta camp," Morimoto told reporters on July 21.
He said if Delta secures new landing slots at Tokyo's Haneda
airport a couple of years from now through Japan-U.S. aviation
negotiations, Delta and Skymark would generate synergy by
connecting the U.S. carrier's international flights to and from
Haneda with the latter's domestic network, according to the
report.
Jiji Press notes that Delta is set to participate in a Skymark
rehabilitation program drawn up by U.S. aircraft leasing company
Intrepid Aviation, the biggest creditor of Skymark. Delta plans to
take an equity stake of less than 20 percent in Skymark, which
would be within investment limits set by the government.
According to the report, Mr. Morimoto said Delta plans to send two
of its officials to serve as Skymark executives. Delta has forged
tie-ups with airlines in Europe, Latin America and Australia, but
has yet to partner with an airline in Japan.
Meanwhile, Jiji Press reports that Skymark has compiled its own
version of turnaround program featuring support from ANA Holdings
Inc., the parent of ANA.
Creditors of Skymark are set to choose one of the two rival plans
at a meeting on Aug. 5, the report notes. Approval requires
support from more than half of the creditors, who must account for
half or more of the total claims, adds Jiji Press.
About Skymark Airlines
Skymark Airlines is a Japanese low-cost carrier based in Tokyo.
The carrier, which commenced operations in 1998, operates domestic
service from its base at Tokyo International Airport.
As reported in the Troubled Company Reporter-Asia Pacific on
Jan. 30, 2015, Bloomberg News said Skymark Airlines Inc., Japan's
third-largest carrier, filed for bankruptcy protection after
running short of cash, highlighting the failure of growth plans
that climaxed in the ill-fated purchase of six Airbus Group NV
A380 superjumbos.
Skymark said it filed at the Tokyo District Court with
JPY71 billion ($603 million) in liabilities. President Shinichi
Nishikubo is standing down and Chief Financial Officer
Masakazu Arimori is taking on the role, Bloomberg related.
Skymark was delisted from the Tokyo Stock Exchange in March.
TOSHIBA CORP: Regulators to Seek Penalty for False Accounting
-------------------------------------------------------------
Reuters, citing the Nikkei, reports that Japan's financial
watchdog plans to seek a financial penalty on Toshiba Corp,
currently being investigated by an independent committee over
accounting irregularities.
Reuters relates that the Securities and Exchange Surveillance
Commission (SESC) believes the company falsified financial
statements and will recommend as early as September that the
Financial Services Agency impose a fine, the business daily said
on July 18, citing sources.
A source familiar with the matter told Reuters that regulators
will begin studying the case to weigh potential penalties after
the committee announced its findings July 20.
Toshiba expects to take up to $3 billion in charges related to six
years of improper accounting, Reuters notes.
As reported in the Troubled Company Reporter-Asia Pacific on
July 22, 2015, Bloomberg News said Toshiba Corp. President Hisao
Tanaka and two other executives quit to take responsibility for a
$1.2 billion accounting scandal that caused the company to restate
earnings for more than six years.
Norio Sasaki, the vice chairman, and Atsutoshi Nishida, a former
president who was serving as adviser, also resigned, the Tokyo-
based company said July 21, more than two months after announcing
it was investigating possible accounting irregularities, according
to Bloomberg. The company said earlier it would correct earnings
by at least JPY152 billion, based on the results of a third-party
investigation of its books, Bloomberg related.
About Toshiba Corp.
Toshiba Corporation (TYO:6502) -- http://www.toshiba.co.jp/-- is
a Japan-based manufacturer involved in five business segments.
The Digital Products segment offers cellular phones, hard disc
devices, optical disc devices, liquid crystal televisions, camera
systems, digital versatile disc (DVD) players and recorders,
personal computers (PCs) and business phones, among others. The
Electronic Device segment provides general logic integrated
circuits (ICs), optical semiconductors, power devices, large-scale
integrated (LSI) circuits for image information systems and liquid
crystal displays (LCDs), among others. The Social Infrastructure
segment offers various generators, power distribution systems,
water and sewer systems, transportation systems and station
automation systems, among others. The Home Appliance segment
offers refrigerators, drying machines, washing machines, cooking
utensils, cleaners and lighting equipment. The Others segment
leases and sells real estate.
As reported in the Troubled Company Reporter-Asia Pacific on
June 25, 2014, Moody's Japan K.K. assigned a rating of Ba1 to the
JPY180 billion in subordinated loans issued by Toshiba
Corporation. At the same time, Moody's has affirmed all of
Toshiba's ratings.
Senior Unsecured Baa2
Senior Unsecured Shelf (P)Baa2
Subordinate Ba1
Commercial Paper P-2
The ratings outlook is stable.
TOSHIBA CORP: To Sell $1 Billion stake in Elevator Maker Kone
-------------------------------------------------------------
Bloomberg News reports that Toshiba Corp. is selling a $1 billion
stake in Finnish elevator and escalator maker Kone Oyj as the
Japanese group moves to bolster its balance sheet amid a probe
into accounting irregularities.
Toshiba will sell about 24.2 million class-B shares in Kone,
representing its entire holding of 4.6 percent of outstanding
shares in the Helsinki-based company, Toshiba said in a statement
on July 21, according to Bloomberg. The stake, which is held by
Toshiba Building and Elevator Services, will be sold to
institutional investors in an accelerated book-build, the company
said.
The Kone shares are being offered from EUR35.38 to their market
price when the sale closes, according to a term sheet obtained by
Bloomberg. Based on July 21's closing price of EUR38.05 the stake
is worth about EUR920 million ($1 billion). UBS Group AG is
managing the sale, Bloomberg notes.
As reported in the Troubled Company Reporter-Asia Pacific on
July 22, 2015, Bloomberg News said Toshiba Corp. President Hisao
Tanaka and two other executives quit to take responsibility for a
$1.2 billion accounting scandal that caused the company to restate
earnings for more than six years.
Norio Sasaki, the vice chairman, and Atsutoshi Nishida, a former
president who was serving as adviser, also resigned, the Tokyo-
based company said July 21, more than two months after announcing
it was investigating possible accounting irregularities, according
to Bloomberg. The company said earlier it would correct earnings
by at least JPY152 billion, based on the results of a third-party
investigation of its books, Bloomberg related.
About Toshiba Corp.
Toshiba Corporation (TYO:6502) -- http://www.toshiba.co.jp/-- is
a Japan-based manufacturer involved in five business segments.
The Digital Products segment offers cellular phones, hard disc
devices, optical disc devices, liquid crystal televisions, camera
systems, digital versatile disc (DVD) players and recorders,
personal computers (PCs) and business phones, among others. The
Electronic Device segment provides general logic integrated
circuits (ICs), optical semiconductors, power devices, large-scale
integrated (LSI) circuits for image information systems and liquid
crystal displays (LCDs), among others. The Social Infrastructure
segment offers various generators, power distribution systems,
water and sewer systems, transportation systems and station
automation systems, among others. The Home Appliance segment
offers refrigerators, drying machines, washing machines, cooking
utensils, cleaners and lighting equipment. The Others segment
leases and sells real estate.
As reported in the Troubled Company Reporter-Asia Pacific on
June 25, 2014, Moody's Japan K.K. assigned a rating of Ba1 to the
JPY180 billion in subordinated loans issued by Toshiba
Corporation. At the same time, Moody's has affirmed all of
Toshiba's ratings.
Senior Unsecured Baa2
Senior Unsecured Shelf (P)Baa2
Subordinate Ba1
Commercial Paper P-2
The ratings outlook is stable.
===============
M A L A Y S I A
===============
1MALAYSIA DEVELOPMENT: Singapore Police Freezes Two Bank Accounts
-----------------------------------------------------------------
Reuters reports that Singapore Police Force has frozen two bank
accounts to help with an investigation in to Malaysia's troubled
state-owned investment fund 1Malaysia Development Bhd (1MDB),
which is being probed by authorities in Malaysia for financial
mismanagement and graft.
"On July 15, 2015, we issued orders under the Criminal Procedure
Code to prohibit any dealings in respect of money in two bank
accounts that are relevant to the investigation," Singapore police
said in a statement on July 21, Reuters relays.
It did not identify the banks or the accounts in question because
the investigation is continuing, the report notes.
Reuters says the freezing of the Singapore bank accounts follows a
similar move in Malaysia where a task force investigating 1MDB
said earlier this month that it had frozen half a dozen bank
accounts following a media report that nearly $700 million had
been transferred to an account of Malaysia's Prime Minister Najib
Razak.
The Wall Street Journal reported on July 3 that investigators
looking into 1MDB had traced close to US$700 million of deposits
moving through Falcon Bank in Singapore into personal bank
accounts in Malaysia belonging to Najib, Reuters relates.
Kuala Lumpur-based 1Malaysia Development Bhd (1MDB) operates as a
government agency. The Company offers financial assistance,
analysis, and advice through investors, corporations, and
consultants to startups and growth companies. 1MDB focuses on
investments with strategic value and high multiplier effects on
the economy, particularly in energy, real estate, tourism, and
agribusiness.
1MALAYSIA DEVELOPMENT: Datuk Remanded Over 1MDB Probe
-----------------------------------------------------
Joseph Kaos Jr at The Star reports that a 54-year-old managing
director of a firm related to 1Malaysia Development Bhd (1MDB) has
been remanded to assist in the probe into alleged misappropriation
of funds.
The Star relates that the man, who is a Datuk, was remanded for
five days by a Magistrate in Malaysia.
He is the second to be nabbed by the task force investigating the
1MDB issue, the report notes.
According to the report, Malaysian Anti-Corruption Commission
(MACC) deputy public prosecutor Ahmad Sazilee Abdul Khairi said
the suspect was nabbed at a shopping mall on July 21 and taken to
the headquarters for questioning.
Ahmad Sazilee said the suspect is being probed for receiving
bribes under Section 17(a) of the MACC Act, the report notes.
On July 21, a director of a Putrajaya-based construction firm was
remanded for four days after he was arrested at the KL
International Airport, The Star relates.
A task force comprising the police, Bank Negara, Attorney-
General's Chambers and MACC was formed to look into the 1MDB
issue, the report adds.
Kuala Lumpur-based 1Malaysia Development Bhd (1MDB) operates as a
government agency. The Company offers financial assistance,
analysis, and advice through investors, corporations, and
consultants to startups and growth companies. 1MDB focuses on
investments with strategic value and high multiplier effects on
the economy, particularly in energy, real estate, tourism, and
agribusiness.
====================
N E W Z E A L A N D
====================
LOMBARD FINANCE: Court Denies Ex-Directors Bid to Recall Judgment
-----------------------------------------------------------------
Hamish Fletcher at The New Zealand Herald reports that Sir Douglas
Graham and his fellow Lombard Finance directors have lost a
"completely misconceived" bid to recall a Supreme Court decision
over their convictions.
Mr. Graham, former Justice Minister Bill Jeffries, former PR man
for the Queen Lawrie Bryant, and Lombard director Michael Reeves
were convicted of making untrue statements in company offer
documents before the firm's failure, the Herald recalls.
Their convictions were upheld by the Court of Appeal, and the
Supreme Court in 2013 refused leave to challenge them, the report
says.
But the Lombard four continued their fight and applied to recall
that Supreme Court decision. That bid was dismissed on July 22,
according to the Herald.
The Herald says the recall application was based on a claim that
the Supreme Court would have taken the case if it had known the
convictions were founded on evidence which had not been formally
proved. Three other related grounds were also advanced in the bid,
the report adds.
The Herald relates that the evidence in question was a schedule of
spreadsheets prepared by Crown expert witness Michelle Peden.
It was not produced in evidence but provided to Queen's Counsel
Colin Carruthers for his closing address to High Court Justice
Robert Dobson, the report relates.
But the Supreme Court on July 22 said that it was satisfied the
grounds on which the recall application was based were "all
misconceived".
"In refusing leave to appeal against conviction, the court was
well aware that the Peden schedule had not been produced as a
Crown exhibit or proved in evidence . . . there is no injustice to
the applicants in the fact that the schedule was not produced as
an exhibit," the court, as cited by Herald, said.
The Herald relates that Chief Justice Sian Elias and Justices
William Young and Susan Glazebrook said there had been a
"substantial mischaracterisation" of what happened at trial.
"More generally, the recall application is very much a second
shot, based in large measure on arguments which, if meritorious,
could and should have been, but were not, advanced when leave to
appeal was first sought," the report quotes the judges as saying.
"In the result, counsel for the Crown have been required to chase
a series of hares which the applicant ought never to have
started."
In light of this, the court is considering whether or not the
Lombard four should pay costs for their application, the Herald
adds.
About Lombard Finance
Lombard Finance & Investments Limited was a wholly owned
subsidiary of Lombard Group, a diversified company specializing
in the financial services sector offering a number of lending
options and providing investment opportunities for its
shareholders and investors.
Lombard Finance was placed into receivership on April 10, 2008,
by its trustee, Perpetual Trust Limited. PricewaterhouseCoopers
partners John Fisk and John Waller have been appointed receivers
of the company. The receivership also applies to three other
subsidiaries of Lombard Group, being Lombard Asset Finance
Limited, Lombard Property Holdings Limited and Lombard Asset
Finance No 2 Limited. The receivership does not impact
Lombard Group Limited.
Some 4,400 Lombard Finance investors were owed NZ$127 million.
====================
S O U T H K O R E A
====================
KOREA RESOURCES: Prosecutors Seek Arrest Warrant For Ex-Chief
-------------------------------------------------------------
Yonhap News Agency reports that prosecutors on July 21 sought an
arrest warrant for the former head of a state-owned resources firm
over alleged malpractice in a money-losing energy development
project.
Kim Shin-jong, who headed the state-run Korea Resources Corp.
(KORES) during the President Lee Myung-bak administration, is
suspected of purchasing Keangnam Enterprises Inc. stocks at an
excessive price that caused KRW21.2 billion (US$18.31 million) in
financial losses to the corporation, the report says.
Yonhap relates that under the plan by then President Lee, KORES
and a consortium of seven South Korean companies, including
Keangnam Enterprises, signed a deal in 2006 to invest a combined
KRW1.9 trillion for a 27.5 percent stake in the energy development
project in Madagascar.
Keangnam Enterprises, however, failed to meet the deadline to pay
for its stake of 2.75 percent, the report says. KORES picked up
the tab and paid an additional KRW17.1 billion on Keangnam's
behalf in 2008, on the condition that the firm repay it by mid-
2009, the report relates.
But Keangnam fell short once again, with KORES taking over
100 percent of its stake in 2010, says Yonhap.
At the time, speculation swirled that former Keangnam Chairman
Sung Wang-jong pressured the president of KORES to purchase the
stake, according to the report.
Yonhap says prosecutors are also investigating whether Kim
received bribes in the case.
Kim is also suspected of investing KRW1.2 billion in developing
rare earth resources, which had a low potential of development,
causing KRW22.4 billion in losses to the corporation, Yonhap
states.
"The business to develop rare earth resources started off well,
and it cannot be simply compared to the current situation," the
ex-chief told reporters while emerging from the prosecution
office.
A hearing was set for July 22 to review the legality of the arrest
writ.
Kang Young-won, a former head of the national oil company, was
also indicted on July 17 on charges of purchasing two Canadian
firms that caused KRW550 billion in losses to the state fund, adds
Yonhap.
*********
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.
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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
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*** End of Transmission ***