/raid1/www/Hosts/bankrupt/TCRAP

/raid1/www/Hosts/bankrupt/TCRAP_Public/151125.mbx T R O U B L E D C O M P A N Y R E P O R T E R A S I A P A C I F I C Wednesday, November 25, 2015, Vol. 18, No. 233 Headlines A U S T R A L I A BC LIM: First Creditors' Meeting Set For December 2 COUDERT BROTHERS: Resolves Clawback Suits Against Ex-Partners MALEK FAHD: Faces Criminal Charges, Insolvent Trading Claims MARK APPLEBY: First Creditors' Meeting Set For Dec. 1 C H I N A WUZHOU INTERNATIONAL: Moody's Puts B2 CFR on Review for Downgrade YANZHOU COAL: Moody's to Retain Ba3 CFR on Repurchase Offer * CHINA: Cracks $64BB 'Underground Bank' Moving Money Abroad H O N G K O N G PHYSICAL PROPERTY: Incurs HK$186,000 Net Loss in Third Quarter I N D I A AARTI CONSTRUCTION: ICRA Suspends B+ Rating on INR3.0cr Loan AKSHAR COTTON: ICRA Reaffirms B+ Rating on INR10.50cr Cash Loan ALLIX CERAMIC: ICRA Reaffirms B Rating on INR6.11cr Term Loan ANAND ENTERPRISE: ICRA Suspends B Rating on INR10cr Cash Loan ANGAYARKKANNI ENTERPRISES: CRISIL Rates INR185MM Term Loan at B+ ANKITA AGRO: CRISIL Cuts Rating on INR75.1MM Term Loan to B- ASCENT NETWORKS: CRISIL Assigns 'B' Rating to INR35MM Cash Loan BAJRANG COTTON: CRISIL Cuts Rating on INR70MM Cash Loan to B+ BAU DEVELOPERS: ICRA Withdraws D Rating on INR46cr Bank Loan BISMAN INDUSTRIES: ICRA Lowers Rating on INR8.0cr Cash Loan to B+ BUDS TEA: ICRA Lowers Rating on INR14cr Term Loan to B+ CISCONS PROJECTS: CRISIL Cuts Rating on INR132.5MM Loan to D CREATIVE AND CROFTS: CRISIL Reaffirms B+ Rating on INR27.5MM Loan DURGASHAKTI FOODS: CRISIL Reaffirms B+ Rating on INR105.1MM Loan ENVISION LANDMARKS: CRISIL Cuts Rating on INR60MM Loan to B- FOREMOST INTERNATIONAL: CRISIL Reaffirms B- Rating on INR11M Loan GANGA COTTON: ICRA Withdraws B+ Rating on INR8cr Bank Loan GATIMAN AUTO: CRISIL Reaffirms B- Rating on INR46MM Cash Loan GOLCHHA ENTERPRISES: CRISIL Reaffirms B+ Rating on INR25MM Loan HERALD PUBLICATIONS: CRISIL Reaffirms B Rating on INR70MM Loan ICON DEVELOPERS: CRISIL Assigns B+ Rating to INR60MM Term Loan JAYAWANTI BABU: CRISIL Assigns 'D' Rating to INR118MM Term Loan JP SORTEX: ICRA Upgrades Rating on INR37cr Cash Loan to B+ JSW STEEL: Fitch Affirms 'BB+' Long-Term Issuer Default Rating KABIR MALL: ICRA Suspends D Rating on INR10cr Bank Loan KAILASH HILLWAYS: CRISIL Assigns B Rating to INR30MM Cash Loan KINGFISHER AIRLINES: SBI Declares Promoter 'Wilful Defaulter' KINGFISHER AIRLINES: SBICap to e-auction Movable Assets LAMB CERAMICS: ICRA Suspends B Rating on INR3cr Cash Credit LICHCHHWI FOOD: Ind-Ra Assigns 'IND B+' Long-Term Issuer Rating LIMTEX AGRI: ICRA Lowers Rating on INR23cr Cash Loan to B+ N.S.K. BUILDERS: CRISIL Reaffirms B Rating on INR150MM Cash Loan NAINANI MEDICO: CRISIL Reaffirms B+ Rating on INR55MM Cash Loan OM COTEX: ICRA Reaffirms B+ Rating on INR18cr Cash Loan PARAMOUNT WHEELS: ICRA Reaffirms B Rating on INR16cr LT Loan PEARL INTERNATIONAL: Ind-Ra Assigns 'IND BB' LT Issuer Rating PRATEEK ALLOYS: ICRA Withdraws B Rating on INR5.0cr Loan RENUKA CONSTRUCTIONS: CRISIL Reaffirms B Rating on INR100MM Loan SHREE SATSANGI: CRISIL Reaffirms B- Rating on INR101.5MM Loan SONI GINNING: Ind-Ra Assigns 'IND B+' Long-Term Issuer Rating SRITHIK ISPAT: ICRA Withdraws D Rating on INR6cr Loan SRITHIK ROLLING: ICRA Withdraws B Rating on INR7.09cr Loan SRV TELECOM: CRISIL Assigns B Rating to INR90MM Cash Loan TIRUPATI CORRUGATORS: CRISIL Reaffirms D Rating on INR77.5MM Loan TPP BOILERS: ICRA Suspends B+ Rating on INR2cr Loan TVC ELECTRONICS: CRISIL Assigns B+ Rating to INR40MM Cash Loan VIDHATRI EXPORTS: CRISIL Cuts Rating on INR60MM Loan to B- VIRAJ SYNTEX: CRISIL Assigns B+ Rating to INR41.5MM Loan XPLORE LIFESTYLE: CRISIL Cuts Rating on INR90MM LT Loan to B J A P A N SHARP CORP: Asks All Employees to Buy Company Products VUZIX CORP: Reports $2.81 Million Net Loss for Third Quarter N E W Z E A L A N D TORCHLIGHT FUND: John Grill to Appeal High Court Ruling on Loan S O U T H K O R E A * SOUTH KOREA: Zombie Companies Spur Restructuring Push - - - - - ================= A U S T R A L I A ================= BC LIM: First Creditors' Meeting Set For December 2 --------------------------------------------------- Brent Kijurina, Richard Albarran, and David Ross of Hall Chadwick were appointed as administrators of BC Lim Investments Pty Ltd on Nov. 23, 2015. A first meeting of the creditors of the Company will be held at Chartered Accountants Australia and New Zealand, Level 3 Bourke Place, 600 Bourke Street, in Melbourne, on Dec. 2, 2015, at 11:00 a.m. COUDERT BROTHERS: Resolves Clawback Suits Against Ex-Partners ------------------------------------------------------------- Cara Salvatore at Bankruptcy Law360 reported that seven clawback suits against former partners of Coudert Brothers LLP who are now at firms including Jones Day and Akin Gump Strauss Hauer & Feld LLP will be dropped, Coudert's bankruptcy administrator told a New York federal judge on Nov. 12, 2015. Seven suits against partners who went to those two firms, K&L Gates LLP and Sheppard Mullin Richter & Hampton LLP will be dropped because the plan administrator, Development Specialists Inc., is satisfied that those partners didn't take any recoverable business with them. About Coudert Brothers Coudert Brothers LLP was an international law firm specializing in complex cross-border transactions and dispute resolution. The firm had operations in Australia and China. Coudert filed for Chapter 11 protection (Bankr. S.D.N.Y. Case No. 06-12226) on Sept. 22, 2006. John E. Jureller, Jr., Esq., and Tracy L. Klestadt, Esq., at Klestadt & Winters, LLP, represented the Debtor in its restructuring efforts. Brian F. Moore, Esq., and David J. Adler, Esq., at McCarter & English, LLP, represented the Official Committee of Unsecured Creditors. Coudert scheduled total assets of $30.0 million and total debts of $18.3 million as of the Petition Date. The Bankruptcy Court in August 2008 signed an order confirming Coudert's chapter 11 plan. The Plan contemplated on paying 39% to unsecured creditors with $26 million in claims. Coudert has been succeeded by Development Specialists, Inc. in its capacity as Plan Administrator under the confirmed chapter 11 plan. MALEK FAHD: Faces Criminal Charges, Insolvent Trading Claims ------------------------------------------------------------ Leo Shanahan at The Australian reports that Australia's largest Muslim school has been warned by external auditors it could be trading while insolvent, with continued government funding to the school in danger, leaving the board facing possible civil and criminal charges. The Australian relates that the warning comes as the Malek Fahd Islamic School at Greenacre in Sydney's southwest steps up security and alerts police to possible "trouble", with a feud between board members and Australian Federation Islamic Councils president Hafez Kassem escalating. The Australian has obtained a series of emails between school board members discussing the spending of AUD3.4 million worth of the school's recurrent funding for education expenditure on building projects after a decision by Westpac to stop lending money to the school. The report says the crisis at the school, which receives about AUD20 million a year in government funding, comes in the middle of final exams and ongoing audits by the federal government. In the emails, school project managers openly discuss paying the builders from the recurrent funding, which is a breach of NSW education laws as well as of the Corporations Act, The Australian relates. "According to current figures available with me, the cost of remaining works would be AUD4.6m excluding this claim. I am unsure as to what funds/saving the school is expecting from 2015 in recurrent funds. It may not have the AUD5 million required to finish the building," one school official writes, The Australian relays. In a letter from the school's external auditors, Moore Stephens accountants, the school's board is warned it would be trading while insolvent and could face criminal and civil penalties if it used the money this way. "As you would be aware, under s 83c of the NSW Education Act . . . the school could be deemed to be operating for profit. A school declared as operating for profit will lead to funding being withdrawn. "In the event of withdrawal of government funding, the question arises as to whether the continued expenditure on construction, when it is known that the school is not in a financial position to make such payments, could result in a determination the school is 'trading while insolvent'," the letter stated, relays The Australian. According to the report, the school is in the midst of a financial and staffing crisis, its board sacking former chairman Mr Kassem last month amid a struggle for control of the school's board. Westpac has said it will freeze Malek Fahd's funds altogether if it does not resolve the crisis, the report adds. Mr Kassem, who is also president of the Australian Federation of Islamic Councils, told The Australian he was not aware of the school using recurrent funding for building projects: "We know that we can only use the grant money for the building project. We know that we can't use the recurrent funding. The school is solvent." He said if recurrent funding had been used by others on the board for the building project, he "did not know about it," The Australian relates. The Australian says security has been stepped up at the school, with emails showing board members who are clinging to their positions informing police and security to keep Mr Kassem out of the school. MARK APPLEBY: First Creditors' Meeting Set For Dec. 1 ----------------------------------------------------- Glenn J Spooner & Daniel P Juratowitch of Cor Cordis Chartered Accountants were appointed as administrators of Mark Appleby Investments Pty Ltd on Nov. 12, 2015. A first meeting of the creditors of the Company will be held at Cor Cordis Chartered Accountants, Level 29, 360 Collins Street, in Melbourne, on Dec. 1, 2015, at 11:00 a.m. ========= C H I N A ========= WUZHOU INTERNATIONAL: Moody's Puts B2 CFR on Review for Downgrade ----------------------------------------------------------------- Moody's Investors Service says that it will continue to review for downgrade Wuzhou International Holdings Limited's B2 corporate family rating and B3 senior unsecured debt ratings. On Nov. 19, 2015, Wuzhou announced that the trading of its shares and notes would resume on Nov. 20, 2015. At the same time, the company's controlling shareholders entered into a share purchase agreement with Mr Sun Hong Bing to dispose 18.77% of the company's issued share capital for a total of HK$320 million, effective 20 Nov. 2015. Upon completion, Mr Shu Cecheng and Mr Shu Cewan will continue to own 51.14% as controlling shareholders. RATINGS RATIONALE "While the share disposal by the controlling shareholders did not breach any change of control provisions in its bond document, we will continue to review any potential impact on its business strategy and operations from the change in shareholders," says Stephanie Lau, a Moody's Assistant Vice President and Analyst. After the share disposal, the major shareholder's ownership will remain above the 50.1% ownership requirement of the change of control provision in the bond document. Moody's will continue to focus its review on: (1) any change in business strategy and daily operations brought about by Wuzhou's new second-largest shareholder; (2) any impact on contracted sales from the change in shareholders; (3) the company's liquidity position. The principal methodology used in these ratings was Homebuilding And Property Development Industry published in April 2015. Wuzhou International Holdings Limited specializes in the development and operation of wholesale markets and multi- functional commercial complexes in China. At June 30, 2015, the company had a total of 37 projects in 11 provinces and municipal cities, including 20 merchandising and logistics centers and 17 multi-functional commercial complexes. At the same time, its land bank totaled approximately 7.4 million square meters in gross floor area. Listed on the Hong Kong Stock Exchange in June 2013, Wuzhou was 51.14% owned by its two founders, Mr. Shu Cecheng and Mr. Shu Cewan, at Nov. 20, 2015. YANZHOU COAL: Moody's to Retain Ba3 CFR on Repurchase Offer ----------------------------------------------------------- Moody's Investors Service says that Yanzhou Coal Mining Co. Ltd.'s announced repurchase offer for its 2022 bonds does not have any immediate impact on its Ba3 corporate family rating, or the senior unsecured debt ratings of Yancoal Int'l Resources Development Co., Ltd and Yancoal International Trading Co., Limited. Yanzhou Coal announced on Nov. 16, 2015, that it plans to repurchase up to $250 million of the $550 million senior notes due on May 16, 2022, issued by Yancoal International Resources Development Co., Ltd. The tender offer price range is between $860 and $895 per $1,000 of principal amount of the notes. "Moody's considers the tender offer by Yanzhou Coal as opportunistic in nature rather than an intention to avoid default. Thus, the offer does not have any impact on the company's ratings," says Dylan Yeo, a Moody's Analyst. Moody's does not believe that the tender offer constitutes a distressed exchange because Yanzhou Coal (1) does not face any imminent refinancing or default risk prior to the tender offer; (2) has sufficient cash on hand to settle the offer as its cash balance was RMB21.4 billion at end-September 2015; and (3) is a state-owned enterprise that enjoys good access to bank financing and the capital markets in China. "The tender offer, if fully subscribed, will allow Yanzhou Coal to reduce overall financing costs and decrease its US dollar- denominated foreign currency exposure. However, its net debt leverage will not be reduced," says Yeo, also the lead analyst for Yanzhou Coal. The proceeds of the tender offer will allow Yanzhou Coal to pay down one of its higher-cost foreign-currency denominated debt securities that is currently trading below par in the secondary market. The tender offer does not change Yanzhou Coal's net debt leverage measured by net debt/EBITDA because the bond repurchase will consume its cash. Moody's expects Yanzhou Coal's net debt leverage ratio to exceed 9.0x in 2016 from 7.5x on a last twelve-months basis as of end- June 2015. The increase will be driven by the company's investment to ramp up its more cost-efficient mines to combat the current low thermal coal prices. The principal methodology used in these ratings was Global Mining Industry published in August 2014. Yanzhou Coal Mining Co. Ltd. was listed in Shanghai, Hong Kong and New York in 1998. It is 56.52%-owned by the Yankuang Group Corporation Limited, a state-owned enterprise that is wholly owned by the Shandong State-Owned Assets Supervision and Administration Commission. At end-2014, the company owned and operated 20 coal mines across China and Australia. It also owned abundant coal resources in China's Shandong and Shanxi provinces, the Inner Mongolia Autonomous Region, as well as in the Australian states of Queensland, New South Wales and Western Australia. * CHINA: Cracks $64BB 'Underground Bank' Moving Money Abroad ------------------------------------------------------------ Bloomberg News reports that China said it cracked the nation's biggest "underground bank," which handled CNY410 billion ($64 billion) of illegal foreign-exchange transactions, as the authorities try to combat corruption and rein in capital outflows that have hit records this year. The official People's Daily, citing police officials, reported on Nov. 20 that more than 370 people have been arrested or face lawsuits or other punishment in the case centered in eastern Zhejiang province, according to Bloomberg. The case brought the total for underground banking and money-laundering activities to CNY800 billion since April, the newspaper said, Bloomberg relays. The probe began in September last year and the police took almost a year to sort through more than 1.3 million suspicious transactions, the state-run Xinhua News Agency reported separately, Bloomberg says. The authorities froze more than 3,000 bank accounts, Xinhua said. According to Bloomberg, the case highlights the nation's struggle to control capital outflows that have helped to send real-estate prices soaring from Vancouver to Sydney -- even when Chinese citizens are officially limited to converting $50,000 of yuan per year. Some people may be moving the proceeds of corruption, while others may be concerned about the outlook for the economy and the potential for the yuan to weaken, Bloomberg states. "The government wants to stem outflows and stabilize the yuan's exchange rate, but the outflows cannot be stopped unless people change their expectation on yuan depreciation," Bloomberg quotes Xi Junyang, a finance professor at Shanghai University of Finance & Economics, as saying. Besides illegal banking operations, "a lot of money is leaving the country by legal means," Xi said. China's capital outflows may have climbed to a record $194 billion in September before cooling to $62 billion in October, according to a Bloomberg gauge which also takes into account decisions by exporters and direct investment recipients to hold funds in dollars. According to Bloomberg, the tactics used by Chinese citizens to defeat the controls include so-called smurfing, where large sums are moved by breaking them down into a series of smaller transfers using the bank accounts and foreign-exchange quotas of a range of individuals. In the Zhejiang case, a suspect identified as Zhao Mouyi used a different method, setting up more than 10 companies in Hong Kong from 2013 and transferring more than CNY100 billion through so- called non-resident accounts, which are used by offshore companies in China when they are transferring money abroad, Bloomberg relates citing the newspaper's report. The People's Daily said taking advantage of a "loophole" relating to non-resident accounts -- which has since been filled by banks - - Zhao circumvented the capital controls by directly transferring yuan overseas and then exchanged the money into foreign currencies at banks including HSBC Holdings Plc in Hong Kong, Bloomberg relays. Zhao then allegedly transferred it to his clients' accounts, the report said, citing the local police, adds Bloomberg. ================ H O N G K O N G ================ PHYSICAL PROPERTY: Incurs HK$186,000 Net Loss in Third Quarter -------------------------------------------------------------- Physical Property Holdings Inc. filed with the Securities and Exchange Commission its quarterly report on Form 10-Q disclosing a net loss and total comprehensive loss of HK$186,000 on HK$254,000 of total operating revenues for the three months ended Sept. 30, 2015, compared to a net loss and total comprehensive loss of HK$169,000 on HK$265,000 of total operating revenues for the same period during the prior year. For the nine months ended Sept. 30, 2015, the Company reported a net loss and total comprehensive loss of HK$556,000 on HK$776,000 of total operating revenues compared to a net loss and total comprehensive loss of HK$598,000 on HK$785,000 of total operating revenues for the same period a year ago. As of Sept. 30, 2015, the Company had HK$9.31 million in total assets, HK$12.20 million in total liabilities, all current, and a HK$2.88 million total stockholders' deficit. A full-text copy of the Form 10-Q is available for free at: http://is.gd/bGzPP0 About Physical Property Holdings Inc. Physical Property Holdings Inc., incorporated on Sept. 21, 1988, is engaged in the real estate business. The Company is involved in buying, investing in, and selling, renovating and renting real estate, exclusively in the Hong Kong Special Administrative Region (SAR) of the People's Republic of China. The Company holds around five residential apartments in Hong Kong. The Company's subsidiaries include Ableforce International Limited and its wholly owned subsidiary Good Partner Limited. Physical Property disclosed a net loss and comprehensive loss of HK$820,000 on HK$1.05 million of rental revenue for the year ended Dec. 31, 2014, compared with a net loss and comprehensive loss of HK$459,000 on HK$1.05 million of rental revenue for the year ended Dec. 31, 2013. Mazars CPA Limited, in Hong Kong, issued a "going concern" qualification on the consolidated financial statements for the year ended Dec. 31, 2014, citing that the Company had a negative working capital as of Dec. 31, 2014, and incurred loss for the year then ended, which raised substantial doubt about its ability to continue as a going concern. ========= I N D I A ========= AARTI CONSTRUCTION: ICRA Suspends B+ Rating on INR3.0cr Loan ------------------------------------------------------------ ICRA has suspended the [ICRA] B+ rating assigned to the INR3.00 crore long term fund based facilities and [ICRA]A4 assigned to the INR6.00 crore short term non fund based facility of Aarti Construction Company. The suspension follows ICRA's inability to carry out a rating surveillance in the absence of the requisite information from the company. Aarti Construction Company was established in 1986 by Mr. Jayantibhai M. Sorathia and other Sorathia family members and is engaged in civil construction business. ACOCO is registered as approved contractor in "AA" class with Roads & Buildings Department, Government of Gujarat and is mainly engaged in execution of water canal projects. The firm is based out of Baroda, Gujarat and has, since inception, executed projects involving construction in water supply segment and related civil work for semi-government agencies / local authorities in Gujarat. AKSHAR COTTON: ICRA Reaffirms B+ Rating on INR10.50cr Cash Loan --------------------------------------------------------------- ICRA has reaffirmed the long term rating of [ICRA]B+ to the INR10.50 crore cash credit facility and INR0.92 crore term loan facility of Akshar Cotton Industries. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Fund Based-Cash Credit 10.50 [ICRA]B+ reaffirmed Fund Based-Term Loan 0.92 [ICRA]B+ reaffirmed The reaffirmation of the rating continues to factor in Akshar Cotton Industries' (ACI) modest scale of operations and financial profile characterised by thin profitability, low debt coverage indicators and high working capital utilization levels. ICRA also takes note of the highly competitive and fragmented industry structure with the limited value additive nature of operations which leads to pressure on profitability. The rating further incorporates the vulnerability of margins to adverse movements in agricultural produce prices due to current low prices on account of slow domestic demand from spinning units. Also, being a partnership firm, any substantial withdrawal by the partners can have an adverse impact on the capital structure of the firm. The rating, however, continues to factor in the experience of partners in the cotton industry and the favorable location of the firm giving it easy access to high quality raw cotton. Akshar Cotton Industries was established in August 2011 as a partnership firm. Partners, Mr. Ashokbhai Dudhagara, Mr. Hashmukhbhai Pansuriya and Mr. Narendrabhai Virani who actively manage the operations, promote it. It is engaged in raw cotton ginning and pressing. The manufacturing unit is located at Kalavad, Dist. Jamnagar in Gujarat. It is equipped with 18 double roller ginning machines and one pressing machine with an installed capacity to produce 230 cotton bales per day (24 hours operation). Recent Results In FY15, the firm reported an operating income of INR75.15 crore and net profit of INR0.11 crore against an operating income of INR64.52 crore and net profit of INR0.40 crore in FY14. ALLIX CERAMIC: ICRA Reaffirms B Rating on INR6.11cr Term Loan ------------------------------------------------------------- ICRA has reaffirmed the [ICRA]B rating assigned to the INR11.11 crore (enhanced from INR10.68 crore) long term fund based facilities of Allix Ceramic Private Limited. ICRA has also reaffirmed the [ICRA]A4 rating assigned to the INR1.35 crore (enhanced from INR0.80 crore) short-term non-fund based facility of ACPL. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Term Loan 6.11 [ICRA]B reaffirmed Cash Credit 5.00 [ICRA]B reaffirmed Bank Guarantee 1.35 [ICRA]A4 reaffirmed The reaffirmation of ratings continues to factor in the moderate scale of operations of the company with limited track record and weak financial profile of the company with net losses reported during FY15, leveraged capital structure, average debt coverage indicators and moderate working capital intensity. Further, the ratings are constrained by ACPL's limited product portfolio comprising only ceramic wall tiles which restricts its sales prospects and dealings with large institutional buyers and the highly fragmented nature of the tiles industry which results in intense competitive pressures. The ratings also take into account the cyclical nature of the real estate industry which is the main consuming sector and exposure of profitability of the company to fluctuating prices of raw materials and gas which is the major fuel. The ratings, however, take comfort from the past experience of the founder promoter in the ceramic industry and the company's competitive advantage in raw material procurement on account of its favourable location in Morbi. Incorporated in April 2013, Allix Ceramic Private Limited (ACPL) commenced commercial production of ceramic wall tiles in May 2014. The manufacturing facility of the company is located at Morbi in Rajkot district of Gujarat with an installed capacity of 34,200 Metric Tonnes Per Annum (MTPA). ACPL manufactures digitally printed ceramic wall tiles of sizes 12" X 12", 12" X 18", 12" X 24" and 8" X 24". The promoters of the company have long standing experience in the ceramic industry owing to their association with the group concern M/s Xpert Ceramic. Recent Results During its eleven months of operations (from May 2014 to March 2015), the company has reported an operating income of INR23.78 crore and net loss of INR0.04 crore for FY15. ANAND ENTERPRISE: ICRA Suspends B Rating on INR10cr Cash Loan ------------------------------------------------------------- ICRA has suspended the long term rating of [ICRA]B assigned to the INR10.00 crore cash credit facility of Anand Enterprise (AE). 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 ---------- ----------- ------- Cash Credit 10.00 [ICRA]B suspended Anand Enterprise (AE) was established as a partnership firm in September 2005 and is engaged in the business of ginning and pressing of raw cotton. The firm's manufacturing facility is located at Veraval (Shapar), Rajkot in Gujarat and is equipped with twenty four ginning machines and one pressing machine. The firm is currently promoted by Mr. Ramesh Changela and Mr. Ramesh Kaneriya who have long-standing experience in the cotton industry. ANGAYARKKANNI ENTERPRISES: CRISIL Rates INR185MM Term Loan at B+ ---------------------------------------------------------------- CRISIL has assigned its 'CRISIL B+/Stable' rating to the bank facilities of Angayarkkanni Enterprises (AE). The ratings reflect AE's modest scale of operations, intense competition in the fragmented road construction industry, and large working capital requirements. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Cash Credit 15 CRISIL B+/Stable Working Capital Term Loan 185 CRISIL B+/Stable The ratings also factor AE's below-average debt protection metrics marked by modest net worth and high gearing. These rating weaknesses are partially offset by the proprietors' extensive experience in the civil construction industry. Outlook: Stable CRISIL believes AE will continue to benefit over the medium term from its promoters' extensive industry experience. The outlook may be revised to 'Positive' in case of improvement in scale of operations and profitability, while improving the capital structure. Conversely, the outlook may be revised to 'Negative' in case the company's financial risk profile deteriorates because of reduced revenue and margins or large debt-funded capital expenditure, or delays in receipt of bills from principal contractors. AE, incorporated in 1988, is a proprietorship firm established by Mr. Kannan. The firm undertakes civil works such as construction of roads and water tanks for the government agencies. ANKITA AGRO: CRISIL Cuts Rating on INR75.1MM Term Loan to B- ------------------------------------------------------------ CRISIL has downgraded its rating on the long-term bank facilities of Ankita Agro and Food Processing Private Limited (AAFL) to 'CRISIL B-/Stable' from 'CRISIL B/Stable'. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Cash Credit 20 CRISIL B-/Stable (Downgraded from 'CRISIL B/Stable') Overdraft Facility 4.9 CRISIL B-/Stable (Downgraded from 'CRISIL B/Stable') Term Loan 75.1 CRISIL B-/Stable (Downgraded from 'CRISIL B/Stable') The downgrade reflects AAFL's weak liquidity as significant delay in commencing operations led to low net cash accrual. Operations were expected to start in August 2014, but started in January 2015, because of delay in streamlining production. As a result, the company is expected to generate net cash accruals of INR5 million against debt obligation of over INR10 million for 2015-16. Turnover for 2015-16 (refers to financial year, April 1 to March 31) is expected at INR120-150 million, significantly below CRISIL's expectation. CRISIL believes AAFL's promoter will continue to meet its operational and financial requirements over the medium term. With increase in turnover and expected tie-ups with customers, net cash accrual is expected to remain sufficient to meet term debt obligation from 2016-17. The rating reflects AAFL's exposure to risks relating to offtake from its recently set-up plant and its expected average financial risk profile. These weaknesses are partially offset by healthy demand for processed oats. Outlook: Stable CRISIL believes AAFL will benefit from healthy prospects for the oats industry. The outlook may be revised to 'Positive' in case of higher-than-expected capacity utilisation and sales, leading to considerable improvement in debt servicing ability. Conversely, the outlook may be revised to 'Negative' in case of lower-than- expected revenue and profitability. AAFL, incorporated in 2005, is promoted by Mr. Rajesh Kumar Jain. The company has set up a facility in Neemrana (Rajasthan) to manufacture oats used as breakfast meal. It commenced commercial operations in January 2015. For 2014-15, AAFL reported net loss of INR17.6 million on net sales of INR6.2 million. ASCENT NETWORKS: CRISIL Assigns 'B' Rating to INR35MM Cash Loan --------------------------------------------------------------- CRISIL has assigned its 'CRISIL B/Stable/CRISIL A4' ratings to the bank facilities of Ascent Networks Private Limited (ANPL). Amount Facilities (INR Mln) Ratings ---------- --------- ------- Proposed Long Term Bank Loan Facility 5 CRISIL B/Stable Letter of Credit 35 CRISIL A4 Bank Guarantee 25 CRISIL A4 Cash Credit 35 CRISIL B/Stable The ratings reflect ANPL's modest scale of operations in a highly competitive information technology industry, and large working capital requirement. The ratings also reflect its below-average financial risk profile marked by modest net worth, high gearing, and below-average debt protection metrics. These weaknesses are partially offset by the promoters' extensive industry experience. Outlook: Stable CRISIL believes ANPL will continue to benefit over the medium term from the extensive industry experience of its promoters. The outlook may be revised to 'Positive' in case of an improvement in profitability along with a substantial increase in scale of operations and a better working capital cycle. Conversely, the outlook may be revised to 'Negative' if revenue growth slows down, or the capital structure or debt protection metrics deteriorate, leading to weakening of the financial risk profile. ANPL was incorporated in 1992, promoted by Mr. Bishwambhar Dayal Bubna and Mr. Ajaykumar Bubna. The company provides system- integrated designs and installs products for data, voice, sound, and security applications. BAJRANG COTTON: CRISIL Cuts Rating on INR70MM Cash Loan to B+ ------------------------------------------------------------- CRISIL has downgraded its rating on the long-term bank facilities of Bajrang Cotton (BC) to 'CRISIL B+/Stable' from 'CRISIL BB- /Stable'. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Cash Credit 70 CRISIL B+/Stable (Downgraded from 'CRISIL BB-/Stable') Proposed Long Term 16.6 CRISIL B+/Stable (Downgraded Bank Loan Facility from 'CRISIL BB-/Stable') The downgrade reflects deterioration in BC's business and financial risk profiles due to reducing sales and capital withdrawals. Net sales declined sharply by about 64 per cent to about INR177.3 million in 2014-15 (refers to financial year, April 1 to March 31) from INR524.2 million in 2013-14 on account of a slump in the overall demand for cotton. In addition, the firm's working capital cycle was stretched with gross current assets increasing to 161 days in as on March 31, 2015, from 70 days a year earlier mainly driven by high inventory. Furthermore, its net worth has reduced to INR31.9 million from INR51.0 million over this period due to capital withdrawal of INR20 million, thus impacting its capital structure. The rating reflects BC's small scale of operations due to its presence in the fragmented and intensely competitive cotton industry, and susceptibility of its operating margin to volatility in raw material prices. The rating also factors in an average financial risk profile because of modest gearing and debt protection metrics. These rating weaknesses are partially offset by the extensive industry experience of the firm's promoters. Outlook: Stable CRISIL believes BC will continue to benefit over the medium term from its promoters' extensive industry experience. The outlook may be revised to 'Positive' in case of a significant improvement in the scale of operations and profitability, leading to a better financial risk profile. Conversely, the outlook may be revised to 'Negative' in case of higher-than-expected debt contracted to meet incremental working capital requirement or capital expenditure. Set up in 2006, BC gins and presses cotton. The firm's plant is in Amreli (Gujarat). BAU DEVELOPERS: ICRA Withdraws D Rating on INR46cr Bank Loan ------------------------------------------------------------ ICRA has withdrawn the [ICRA]D rating assigned to the INR46.00 crore fund based bank limit of Bau Developers Private Limited, as the company has fully repaid the instrument on maturity. There is no amount outstanding against the rated instrument. BISMAN INDUSTRIES: ICRA Lowers Rating on INR8.0cr Cash Loan to B+ ----------------------------------------------------------------- ICRA has revised the long term rating for the INR8.00 crore fund based facilities and INR0.20 crore non fund based facilities of Bisman Industries Limited from [ICRA]BB to [ICRA]B+. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Fund Based-Cash 8.00 [ICRA]B+ downgraded Credit from [ICRA]BB (Stable) Non Fund Based 0.20 [ICRA]B+ downgraded from [ICRA]BB (Stable) The revision in the ratings considers the deterioration in the financial risk profile of the Limtex group as a whole, primarily the flagship company Limtex India Limited (rated at [ICRA]D/D), which incurred significant cash losses during FY15 primarily due to increase in tea procurement cost relative to its realization. The ratings also factor in the decline in the operating profits of Bisman Industries Limited during FY 2015 on account of high input costs for the biscuit manufacturing segment and the inability of the company to pass on the same owing to intense competition. The rating also reflects the highly working capital intensive nature of operations, which leads to pressure on the liquidity position of the company, as reflected by almost full utilization of the sanctioned limits every month. The ratings also continue to factor in the experience of the promoters in the tea and biscuits industry. Bisman Industries Limited (BIL) was established in the year 1988 by Mr. Subhash Kumar Poddar in the name of Limtex Industries Ltd having its registered office at Kolkata. The company is engaged in manufacturing of biscuits and trading of tea in the domestic markets, primarily East India. BIL has a biscuit manufacturing unit in Asansol, West Bengal, with an installed production capacity of 1500 MTPA and has a warehousing unit in Kolkata for blending of tea. BIL sells both biscuits and tea under the brand "Nargis". Recent Results The company reported an operating income (OI) of INR40.64 crore and a net profit of INR0.01 crore during FY15 as compared to an OI of INR35.61 crore and a PAT of INR0.26 crore during FY14. BUDS TEA: ICRA Lowers Rating on INR14cr Term Loan to B+ ------------------------------------------------------- ICRA has revised the long term rating for the INR14.00 crore term loan facilities, INR12.75 crore fund based facilities and INR0.50 crore non fund based facilities of Buds Tea Industries Limited from [ICRA]BB to [ICRA]B+. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Term Loan 14.00 [ICRA]B+ downgraded from [ICRA]BB (Stable) Fund Based 12.75 [ICRA]B+ downgraded from [ICRA]BB (Stable) Non Fund Based 0.50 [ICRA]B+ downgraded from [ICRA]BB (Stable) The revision in the ratings considers the deterioration in the financial risk profile of the Limtex group as a whole, primarily the flagship company Limtex India Limited (rated at [ICRA]D/[ICRA]D), which incurred significant cash losses during FY15 primarily due to increase in tea procurement cost relative to its realization. The rating also factors in the decline in the net profit margins of Buds Tea Industries Limited during FY2015 on account of high financial costs charged during FY15, which were capitalized till FY14. In addition, the highly working capital intensive nature of operations continues to put pressure on the liquidity position of the company. The ratings also continue to factor in the experience of the promoters in the tea industry. Buds Tea Industries Limited was established in the year 2006 and is engaged in the manufacturing of CTC variety of tea. The plant is located near Jalpaiguri, West Bengal. At present, the annual capacity of the company is 5.5 million lakh kgs of tea. Recent Results The company reported an operating income (OI) of INR58.33 crore and a net profit of INR0.08 crore during FY15 as compared to an OI of INR27.81 crore and a PAT of INR0.23 crore during FY14. CISCONS PROJECTS: CRISIL Cuts Rating on INR132.5MM Loan to D ------------------------------------------------------------ CRISIL has downgraded its ratings on the bank facilities of Ciscons Projects Private Limited (Ciscons) to 'CRISIL D/CRISIL D' from 'CRISIL B+/Stable/CRISIL A4'. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Bank Guarantee 30 CRISIL D (Downgraded from 'CRISIL A4') Overdraft Facility 27.5 CRISIL D (Downgraded from 'CRISIL B+/Stable') Proposed Long Term 132.5 CRISIL D (Downgraded from Bank Loan Facility 'CRISIL B+/Stable') Term Loan 10 CRISIL D (Downgraded from 'CRISIL B+/Stable') The rating downgrade reflects instances of delay by Ciscons in servicing its debt owing to weakening in its liquidity. The liquidity has weakened on account of a stretch in receivables cycle resulting in a cash-flow mismatches. Ciscons has a modest scale of operations in the intensely competitive civil construction industry, has large working capital requirements, and its modest net worth limits its financial flexibility to meet any exigency. However the company benefits from the extensive experience of the promoters in the civil construction industry. Ciscons was set up in 2008 by Mr. N Rama Krishna and his family members. The company undertakes civil construction, and mainly caters to power generation companies. It is based in Hyderabad (Telangana). CREATIVE AND CROFTS: CRISIL Reaffirms B+ Rating on INR27.5MM Loan ----------------------------------------------------------------- CRISIL's ratings on the bank facilities of Creative and Crofts Industries India Private Limited (CCPL) continues to reflect its modest scale of operations in the intensely competitive furniture hardware industry, working capital intensity, and average financial risk profile. These rating weaknesses are partially offset by the promoters' extensive industry experience and funding support. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Cash Credit 9.5 CRISIL B+/Stable (Reaffirmed) Foreign Bill Purchase 27.5 CRISIL B+/Stable (Reaffirmed) Packing Credit 20 CRISIL A4 (Reaffirmed) Proposed Long Term Bank Loan Facility 13 CRISIL B+/Stable (Reaffirmed) Outlook: Stable CRISIL believes CCPL will continue to benefit over the medium term from its promoters' extensive industry experience. The outlook may be revised to 'Positive' if higher-than-expected cash accrual and efficient management of working capital cycle strengthens the financial risk profile, particularly liquidity. Conversely, the outlook may be revised to 'Negative' if a significant decline in revenues or operating profitability, or stretch in working capital cycle constrains the liquidity. CCPL was established in 2006 by Mr. Harshvardhan Sharma in partnership with Crofts & Assinder Ltd (United Kingdom). The company is a 100 per cent export oriented unit that manufactures hardware used in furniture. It is based in Aligarh (Uttar Pradesh). DURGASHAKTI FOODS: CRISIL Reaffirms B+ Rating on INR105.1MM Loan ---------------------------------------------------------------- CRISIL's rating on the bank facilities Durgashakti Foods Private Limited (DFPL) continues to reflect low profitability, moderately large working capital requirement, average debt protection metrics, and vulnerability to volatility in raw material prices. These weaknesses are partially offset by the extensive experience of the company's promoters in the edible oil industry, proximity to raw material sources, and moderate capital structure. CRISIL had upgraded its rating on DFPL's bank facilities to 'CRISIL B+/Stable' vide its rating rationale dated November 13, 2015. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Cash Credit 105.1 CRISIL B+/Stable (Reaffirmed) Term Loan 44.9 CRISIL B+/Stable (Reaffirmed) The rating upgrade reflects improvement in DFPL's capital structure and stable business risk profile. Net worth increased to INR143.7 million as on March 31, 2015, from INR59 million in the previous year, while gearing reduced to 1.18 times as on March 31, 2015, from 2.48 times as on March 31, 2014; primarily due to conversion of unsecured loans into equity. Revenues also improved to INR1.81 billion in 2014-15 (refers to financial year, April 1 to March 31) from INR1.69 billion in 2013-14; while operating profitability remained stable at 3 per cent. CRISIL believes DFPL will maintain its capital structure over the medium term backed by steady revenue growth, and plough back increasing accrual into business. Outlook: Stable CRISIL believes DFPL will continue to benefit over the medium term from promoters' extensive industry experience. The outlook may be revised to 'Positive' if significant and sustained increase in revenue and profitability leads to sizable cash accrual and improvement in debt protection metrics. Conversely, the outlook may be revised to 'Negative' if financial risk profile, particularly liquidity, weakens because of low cash accrual, stretch in working capital cycle, or any large, unanticipated, debt-funded capital expenditure. DFPL was set up in 2008 by Mr. Shashikant Sureka and his two brothers to expand their family-run edible oil business. The Sureka family has been manufacturing crude edible oil (soya and sunflower) and de-oiled cakes for more than two decades. The company's production facility is in Khamgaon (Maharashtra). ENVISION LANDMARKS: CRISIL Cuts Rating on INR60MM Loan to B- ------------------------------------------------------------ CRISIL has downgraded its rating on the long-term bank facility of Envision Landmarks LLP (ELL) to 'CRISIL B-/Stable' from 'CRISIL B/Stable'. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Term Loan 60 CRISIL B-/Stable (Downgraded from 'CRISIL B/Stable') The rating downgrade reflects CRISIL's belief that ELL's cash flow and liquidity will remain constrained over the medium term due to lower-than-anticipated bookings and customer advances and slow progress in its ongoing project. Lower-than-expected cash inflow is likely to constrain liquidity and result in high funding risk, given the sizeable incremental construction cost to be incurred and maturing debt obligations of INR10.0-12.5 million every quarter. CRISIL believes any improvement in the firm's liquidity will remain dependent on incremental bookings and timely receipt of advances, over the medium term. The rating reflects ELL's exposure to high implementation and funding risks for the ongoing project, and to the cyclicality inherent in the Indian real estate industry. These rating weaknesses are partially offset by the extensive experience and track record of the firm's partners in the real estate sector in Pune (Maharashtra) and surrounding areas. Outlook: Stable CRISIL believes ELL will continue to benefit over the medium term from its partners' extensive industry experience and established track record. The outlook may be revised to 'Positive' in case of better-than-expected booking of units and receipt of customer advances, leading to high cash inflow. Conversely, the outlook may be revised to 'Negative' in case of deterioration in ELL's financial risk profile, particularly liquidity, either because of low booking or delays in receipt of customer advances, or simultaneous execution of other projects. ELL is a partnership firm started by Mr. Tejas Ghadge, Mr. Kedar Ranade, Mr. Hemant Shinde, Mr. Vikrant Indulkar, and Mr. Amit Shinde in 2012-13 (refers to financial year, April 1 to March 31). The firm develops real estate in Pune. Currently, it is undertaking a residential project, Girisparsh, in Khed Shivapur, 20 kilometres from Pune. FOREMOST INTERNATIONAL: CRISIL Reaffirms B- Rating on INR11M Loan ----------------------------------------------------------------- CRISIL's ratings on the bank facilities of Foremost International Pvt Ltd (FIPL) continue to reflect FIPL's modest scale of operations with high customer concentration, large working capital requirement, and low cash accrual, constraining the financial risk profile, particularly liquidity. These rating weaknesses are partially offset by the extensive experience of promoters in the ready-made garments (RMG) industry. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Foreign Bill Discounting 90 CRISIL A4 (Reaffirmed) Foreign Letter of Credit 26.5 CRISIL A4 (Reaffirmed) Long Term Loan 11 CRISIL B-/Stable (Reaffirmed) Packing Credit 90 CRISIL A4 (Reaffirmed) Outlook: Stable CRISIL believes FIPL will continue to benefit over the medium term from the promoters' extensive experience in the RMG industry. The financial risk profile will remain weak on account of large debt over the period. The outlook may be revised to 'Positive' if significant growth in turnover and profitability results in substantial accrual, and consequently, improved financial risk profile, particularly liquidity. Conversely, the outlook may be revised to 'Negative' in case of considerable decline in revenue or profitability, or deterioration in working capital management resulting in further pressure on liquidity, or large, debt-funded capital expenditure, leading to deterioration in the financial risk profile. Update FIPL's revenue stood at INR406 million in 2014-15 (refers to financial year, April 1 to March 31), nearly 30 per cent higher than INR310 million in 2013-14, owing to increased orders from existing customers as well as an increase in production capacity. The operating margin was at 9.78 per cent in 2014-15, which is in line with historical levels. The operations remain working capital intensive, with gross current assets at 361 days as on March 31, 2015, also in line with past trends. The financial risk profile remained weak because of high gearing at 4.28 times and moderate net worth of INR76.9 million as on March 31, 2015. The debt protection metrics continued to be below average in 2014-15; the interest coverage and net cash accrual to total debt ratios were at 1.3 times and 0.02 times, respectively, for the year. The liquidity has remained constrained by high utilisation of bank lines at around 91 per cent and barely sufficient net cash accrual against debt obligation. FIPL's profit after tax (PAT) fell to INR1.9 million on sales of INR406 million in 2014-15, from a PAT of INR2.3 million on sales of INR310 million in 2013-14. Incorporated in 2002, FIPL manufactures and exports RMG, predominantly for women, to Europe. The company, promoted by Mr. Varun Moudgil and Mrs. Shailja Khanna, has its manufacturing plant in Gurgaon (Haryana). GANGA COTTON: ICRA Withdraws B+ Rating on INR8cr Bank Loan ---------------------------------------------------------- ICRA has withdrawn the suspended rating of [ICRA]B+ assigned to the INR8.00 crore Bank Loans Programme of Ganga Cotton Industries. As per ICRA's policy on withdrawals, ICRA can withdraw the rating in case the rating remains suspended for more than three years. Ganga Cotton Industries was established in the year 2005 as a partnership firm. The firm is involved in the business of cotton ginning and cotton seed crushing with a product mix of FP cotton bales, cotton wash oil and oil cakes. The firm is also involved in trading of FP cotton bales and cotton seeds. The unit of the firm has 18 ginning machines and 5 expellers with the annual installed capacity of 4320 MT of cotton lint and 810 MT of cotton seed oil per annum. GATIMAN AUTO: CRISIL Reaffirms B- Rating on INR46MM Cash Loan ------------------------------------------------------------- CRISIL's ratings on the bank facilities of Gatiman Auto Private Limited (GAPL) continue to reflect GAPL's weak financial risk profile because of modest debt protection metrics, high gearing, and small net worth, driven by large debt funded capital expenditure, subdued cash accrual, and substantial working capital requirement. The ratings also factor in small scale of operations and its susceptibility to volatility in raw material prices. These weaknesses are mitigated by the promoters' extensive experience in the automobile components industry, and established customer relationships. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Bank Guarantee 2 CRISIL A4 (Reaffirmed) Cash Credit 46 CRISIL B-/Negative (Reaffirmed) Letter of Credit 14.5 CRISIL A4 (Reaffirmed) Outlook: Negative CRISIL believes GAPL's liquidity will remain weak over the medium term, with its depressed cash accrual expected to be barely sufficient to meet debt obligation. The ratings may be downgraded if debt servicing is delayed. Conversely, the outlook may be revised to 'Stable' if a substantial and sustained improvement in revenue and profitability or substantial equity infusion constrains liquidity. Incorporated in 1988, GAPL manufactures sheet metal components (press parts), mainly fuel tanks, silencer assemblies, and tippers for automobile and industrial original equipment manufacturers. The company is based in Pithampur (Madhya Pradesh) and is promoted by Mr. Ashvin Shah, Mr. Subhash Chuttar, Mr. Shyam Jain, and Mr. Prafull Kothadiya. GOLCHHA ENTERPRISES: CRISIL Reaffirms B+ Rating on INR25MM Loan --------------------------------------------------------------- CRISIL's ratings on the bank facilities of Golchha Enterprises Private Limited (GEPL) continue to reflect GEPL's average financial risk profile because of a weak interest coverage ratio and a small net worth. This rating weakness is partially offset by the extensive experience of the company's promoters in the industrial chemicals trading business, and its well-diversified product portfolio and customer base. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Bank Guarantee 25 CRISIL A4 (Reaffirmed) Cash Credit 25 CRISIL B+/Stable (Reaffirmed) Foreign Letter of Credit 90 CRISIL A4 (Reaffirmed) Outlook: Stable CRISIL believes GEPL will continue to benefit over the medium term from its promoters' extensive industry experience and its well- diversified revenue profile. The outlook may be revised to 'Positive' in case of a significant improvement in the financial risk profile, driven by better working capital management. Conversely, the outlook may be revised to 'Negative' if the financial risk profile deteriorates, with a further weakening of the capital structure, most likely due to lengthening of its working capital cycle or debt-funded capital expenditure. GEPL was incorporated in 2007, promoted by the Golchha family. The Jamshedpur (Jharkhand)-based company trades in various chemicals, minerals, ferroalloys, and metals in the domestic market. HERALD PUBLICATIONS: CRISIL Reaffirms B Rating on INR70MM Loan -------------------------------------------------------------- CRISIL's ratings on the bank facilities of Herald Publications Private Limited (HPPL) continue to reflect its modest scale of, and working capital intensity in, operations, and geographic concentration in revenue. These rating weaknesses are partially offset by the promoters' extensive experience in the newspaper industry, and the company's moderate financial risk profile, especially capital structure, and above-average debt protection metrics. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Bank Guarantee .5 CRISIL A4 (Reaffirmed) Cash Credit 70.0 CRISIL B/Stable (Reaffirmed) Letter of Credit 5 CRISIL A4 (Reaffirmed) Term Loan 64.5 CRISIL B/Stable (Reaffirmed) Outlook: Stable CRISIL believes HPPL will continue to benefit over the medium term from the promoters' extensive experience. The outlook may be revised to 'Positive' if cash accrual increases substantially, while profitability and capital structure remain stable. Conversely, the outlook may be revised to 'Negative' if a decline in revenue or margins, or further stretch in working capital cycle, impacting the liquidity and financial risk profile. Set up in 1989, HPPL publishes an English daily newspaper 'Herald' in Goa. The company also publishes a Marathi weekly newspaper 'Dainik Herald' and a Konkani weekly newspaper 'Amcho Avaz'. It has an operational 24-hour free-to-air (FTA) English news and entertainment channel, HCN, in Goa. HPPL also prints labels, cartons, and card board boxes. Mr. Raul Fernandes and his brother Mr. Oswald Fernandes are the promoters. The office and manufacturing unit is at Panaji (Goa). ICON DEVELOPERS: CRISIL Assigns B+ Rating to INR60MM Term Loan -------------------------------------------------------------- CRISIL has assigned its 'CRISIL B+/Stable' rating to the long-term bank facility of Icon Developers (ID). Amount Facilities (INR Mln) Ratings ---------- --------- ------- Term Loan 60 CRISIL B+/Stable The rating reflects ID's exposure to implementation and offtake- related risks associated with its ongoing project, and its susceptibility to the inherent risks and cyclicality in the real estate sector in India. These rating weaknesses are partially offset by the extensive experience of the firm's promoters in the real estate sector, and moderate funding risk for its ongoing project. Outlook: Stable CRISIL believes that ID will continue to benefit over the medium term from the extensive industry experience of its promoters. The outlook may be revised to 'Positive' if there is a significant improvement in the firm's financial risk profiles, backed by timely completion of, and healthy offtake for, its ongoing project, leading to healthy cash accruals. Conversely, the outlook may be revised to 'Negative' if ID faces a time or cost overrun in its ongoing project, or in case of delays in receiving customer advances, leading to pressure on its revenue and profitability, and consequently to deterioration in its debt servicing ability. Icon Developers (ID) is constructing 145 luxury apartments along with club & other facilities over 2 acres of land area at Bara Devi (Kidwai Nagar). ID developer is partnership firm , the day to day operations of the project is managed by Mr Pawan Garg JAYAWANTI BABU: CRISIL Assigns 'D' Rating to INR118MM Term Loan --------------------------------------------------------------- CRISIL has assigned its 'CRISIL D' rating to the long-term bank facility of Jayawanti Babu Foundation (JBF). The rating reflects instances of delay by JBF in servicing its debt; the delays have been caused by the trust's weak liquidity. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Term Loan 118 CRISIL D JBF has modest scale of operations and is vulnerable to regulatory risks associated with educational institutions. However, the trust benefits from healthy demand prospects for the educational industry, funding support from JBF's promoters and moderate financial risk profile marked by moderate net worth and low gearing. Jayawanti Babu Foundation (JBF) was established in 2007 by Mr Santosh Pal situated in Oras, Sindhudurg. There are two institutions under this trust namely Metropolitan Institute of Technology and Management (MITM) and Aarna Institute of Maritime Studies (AIMS). JP SORTEX: ICRA Upgrades Rating on INR37cr Cash Loan to B+ ---------------------------------------------------------- ICRA has upgraded its long term rating on the INR37.00 crore cash credit facility and INR3.00 crore unallocated limits of JP Sortex Private Limited to [ICRA]B+ from [ICRA]B and has reaffirmed its short term rating at [ICRA]A4. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Cash Credit 37.00 [ICRA]B+; upgraded from [ICRA]B Unallocated Limits 3.00 [ICRA]B+; upgraded from [ICRA]B/[ICRA]A4 reaffirmed The rating upgrade is driven by the 45% year on year increase in JPSPL's operating income in 2014-15, driven by increase in sales volumes as well as realizations, for the rice sold by the company. The ratings favourably take into account the extensive experience and the long track record of the promoters in the rice milling industry and the stable long term demand prospects for the rice industry, with India being the second largest producer and consumer of rice in the world. However, the ratings are constrained by the intensely competitive nature of the industry which exerts pressure on the company's operating margins and the vulnerability of the company's profitability to adverse movements in foreign exchange rates, with export of basmati rice accounting for about 75% of the company's turnover in 2014-15. The ratings also take into account the vulnerability of the company's operations to agro climatic risks, which can affect the pricing and availability of paddy and the high working capital intensity of operations. The company's thin profitability coupled with its large working capital borrowings have translated into an adverse capital structure and weak debt protection indicators. Going forward, JSPL's ability to continue its growth momentum, while improving its margins and optimally managing its working capital cycle will constitute the key rating sensitivities. Incorporated in 2001, JPSPL is primarily engaged in the milling of basmati rice. The company's milling unit is located in Firozpur, Punjab, in close proximity to the local grain market. It sells rice under its five registered brands in the domestic market, these brands include Rice-o-Punjab, Rice-o-India, 5 Horses, 65 and JPA. JPSPL sells its product across various states in India including Delhi, Tamil Nadu, Gujarat, Maharashtra, and Madhya Pradesh, and is also involved in the export of rice primarily to countries in the Middle East, wherein it derives ~75% of its total revenue. Recent Results In 2014-15, JPSPL reported a net profit of INR0.28 crore on an operating income of INR101.78 crore, as against a net profit of INR0.19 crore on an operating income of INR70.04 crore in 2013-14. JSW STEEL: Fitch Affirms 'BB+' Long-Term Issuer Default Rating -------------------------------------------------------------- Fitch Ratings has revised JSW Steel Limited's (JSW Steel) Outlook to Negative from Stable, while affirming the Long-Term Issuer Default Rating (IDR) at 'BB+'. The agency also affirmed JSW Steel's senior unsecured rating and the rating on its USD500m 4.75% senior unsecured notes due 2019 at 'BB+'. The revision in the Outlook reflects the risk of further declines in pricing, which would make it difficult for the company to improve performance and reduce leverage. JSW Steel's financial profile weakened amid challenging conditions for Indian steel producers in 2015 and high debt levels as the company expands capacity. A key assumption of Fitch's rating case is that steel prices will recover modestly in the financial year ending 31 March 2017 (FY17) in response to improving steel demand in India. The rating reflects the company's strong market position and highly efficient operations, which allow it to maintain low costs. Fitch expects JSW Steel's financial profile to improve significantly in FY17 and FY18 with the benefits from capex driving higher sales volume and improvement in profitability. The better sales and profitability are key to maintaining the 'BB+' rating. KEY RATING DRIVERS Challenging Market Dynamics: Fitch expects the pressure on JSW Steel's profitability to continue in the near term. Indian steel makers have been battling an influx of cheaper steel mainly from China and muted demand. JSW Steel's consolidated blended EBITDA per tonne fell to INR5,328 (USD82) during the six months ending 30 September 2015 (1HFY16) from INR9,080 a year earlier. However, the government imposed a 20% duty on imports of certain steel products from 14 September 2015 for 200 days, which has provided temporary relief to Indian steel producers. We consequently expect the company's blended EBITDA per tonne to improve during 2HFY16. Fitch expects JSW Steel's profitability to improve modestly in FY17, supported by moderate improvement in Indian steel demand. However, we expect Indian steel imports to remain high during 2016 and steel prices to continue to be low; and JSW Steel's EBITDA per ton is likely to remain below INR7,000. Temporary Rise in Leverage: JSW Steel's financial profile has weakened because of a fall in profitability and increasing debt levels due to its ongoing capex. We expect the company's FFO net leverage to rise to around 5.4x during FY16 (FY15: 4.5x), which is high for its current rating. However, Fitch projects JSW Steel will deleverage in the next two to three years and expects FFO net leverage to fall below 3.5x in 2018, bringing it to a level commensurate with a 'BB+' rating. This is provided there is no further softening of steel prices or increase in imports. Capex Nearing Completion: JSW Steel's expansion of its capacity to 18 million tonnes per annum (mpta), from 14mtpa now, is nearing completion. The company expects to complete its expansion to 18 mtpa by 4QFY16. Fitch expects JSW Steel to report free cash flows from FY17 once the capex completes and benefits from the larger capacity start flowing. We expect this to aid the deleveraging efforts. Leading Market Position: JSW Steel has a leading market position and is among the largest steel producers in India. The company has a dominant market share in southern and western India where its plants are located. JSW Steel's market position is also supported by its increasing share of value-added products, which is likely to improve its profitability over the medium term. Efficient Operations: JSW Steel's highly efficient operations and low costs for energy and labour support its low steel conversion cost. The company has among the lowest conversion costs globally, which underpins profitability despite the lack of vertical linkages. Absence of Vertical Linkages: JSW Steel has minimal vertical integration for both iron ore and coking coal. This results in higher costs compared with some of its peers, because it needs to purchase these raw materials. However, the company's low conversion costs have mitigated this to a large extent, and JSW Steel has benefited from the fall in commodity prices. JSW Steel has also diversified its raw-material sourcing to minimise the impact on operations from supply disruptions. KEY ASSUMPTIONS Fitch's key assumptions within the rating case for JSW Steel include -- Iron ore prices in line with Fitch's mid-cycle assumptions of US$50/tonne during 2016 and USD55/tonne in 2017 and soft steel prices -- Completion of expansion to 18 mtpa by 4QFY16 -- No major capex after the expansion to 18mtpa -- Volume growth of over 5% in FY16 and over 10% in the next two years RATING SENSITIVITIES Positive: Future developments that may, individually or collectively, lead to the Outlook being revised to Stable include: -- FFO net leverage improving to 3.5x or below on a sustained basis -- Improvement in EBITDA/tonne to around USD100 in FY17 and further to around USD120 thereafter on a sustained basis (FY15: USD116) -- Free cash flows turning positive by FY17. Negative: Future developments that may, individually or collectively, lead to negative rating action include: -- FFO net leverage exceeding 3.5x on a sustained basis -- Weakening profitability resulting in sustained EBITDA/ tonne of below USD120 beyond 2017 -- Free cash flows remaining negative over the cycle. KABIR MALL: ICRA Suspends D Rating on INR10cr Bank Loan ------------------------------------------------------- ICRA has suspended the [ICRA] D rating for the INR10.00 crore bank facilities of Kabir Mall. The suspension follows ICRA's inability to carry out a rating surveillance in the absence of the requisite information from the company. KAILASH HILLWAYS: CRISIL Assigns B Rating to INR30MM Cash Loan -------------------------------------------------------------- CRISIL has assigned its 'CRISIL B/Stable/CRISIL A4' ratings to the bank facilities of Kailash Hillways Engineering associates (KHEA). Amount Facilities (INR Mln) Ratings ---------- --------- ------- Term Loan 7 CRISIL B/Stable Bank Guarantee 35 CRISIL A4 Cash Credit 30 CRISIL B/Stable The ratings reflect KHEA's limited revenue diversity with high geographical concentration risk, small scale of operations in the highly fragmented civil construction segment, and large working capital requirement constraining the liquidity. These rating weaknesses are mitigated by the promoters' extensive industry experience. Outlook: Stable CRISIL believes KHEA will continue to benefit over the medium term from its promoters' extensive industry experience. The outlook may be revised to 'Positive' if KHEA achieves higher-than-expected revenue growth while maintaining profitability and capital structure. Conversely, the outlook may be revised to 'Negative' if the capital structure and debt protection metrics are weakened because of increased reliance on debt to fund the incremental working capital requirement, lower than expected revenue or the liquidity weakens on account of stretched working capital cycle. KHEA was established as a partnership firm by Mr. Kailash Pokhriyal, Mr. Bachan Pokhriyal and Mr. Chandervir Singh Pokhriyal in 2001. The firm undertakes the construction and maintenance of roads and bridges for government projects in Garhwal (Uttarakhand). KHEA reported a net profit of INR11.2 million on net sales of INR176.7 million in FY 2014-15 against net sales of INR3.2 million on net sales of INR64.5 million in FY 2013-14. KINGFISHER AIRLINES: SBI Declares Promoter 'Wilful Defaulter' ------------------------------------------------------------- Neeraj Chauhan & Mayur Shetty at The Times of India reports the State Bank of India -- the largest lender to defunct airline Kingfisher -- has declared the carrier, its promoter Vijay Mallya and United Breweries Holdings as "wilful defaulters" after its grievance redressal committee rejected the arguments made by the borrower through its legal representative recently. According to the report, the move comes even as the Enforcement Directorate (ED) is set to launch a money laundering probe against Mallya and Kingfisher Airlines. TOI relates that sources said the agency has asked for a copy of the FIR filed by CBI so that a case under the Prevention of Money Laundering Act could be filed against Mallya and the airline on the basis of "prime facie evidence". It is alleged that a major chunk of loans to the tune of INR4,000 crore extended to Kingfisher by nationalised banks, which are now under CBI probe, were diverted to tax havens such as Cayman Island and Mauritius, the report says. TOI relates that sources said that Mallya's role is being probed as the head of the company as initial investigations have pointed to possible misuse of bank funds. Officials said a loan taken from IDBI Bank was shown to have been used for leasing aircraft from companies based in tax havens and high rent was paid to the companies. For the 'king of good times', the immediate worry would be the action taken by SBI after he mounted a legal challenge in similar cases initiated by other banks, says TOI. Sources said SBI had taken pains to ensure that the charges stick. TOI notes that the biggest implication of a wilful defaulter tag is that banks will not lend to any business associated with a wilful defaulter. Two, they may even push for change of management of companies where they have sizeable exposure and promoter has been declared a wilful defaulter. SBI had proceeded against the airline on the grounds that funds were not used for the assigned purpose and loans were not paid even when there were resources available, adds TOI. About Kingfisher Airlines Headquartered in Mumbai, India, Kingfisher Airlines -- http://www.flykingfisher.com/-- formerly known as Deccan Aviation Ltd., served about 35 domestic destinations with a fleet of more than 40 aircraft, including Airbus jets and ATR 72 turboprops. As reported in the Troubled Company Reporter-Asia Pacific on Jan. 15, 2014, Bloomberg News said Kingfisher has grounded planes since October 2012. The airline lost its operating license in January last year after failing to convince authorities it has enough funds to restart flights. The airline defaulted on payments to lessors, creditors and airports as losses widened amid rising fuel costs and competition. According to Bloomberg News, Mr. Mirpuri said in an e-mail on January 13 the airline continues its efforts to recapitalize and restart services. As reported in the TCR-AP on May 18, 2015, CRISIL's ratings on bank loan facilities of Kingfisher Airlines Ltd (KFAL) continue to reflect delays by KFAL in servicing its debt; the delays have been caused by the company's weak liquidity and continued losses at the operating level. Losses in the past seven years have resulted in a complete erosion of KFAL's net worth, leading to its weak financial risk profile. Presently, the company does not carry out any commercial operations. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Cash Credit 8940 CRISIL D (Reaffirmed) Funded Interest Term Loan 2260 CRISIL D (Reaffirmed) Long Term Loan 5970 CRISIL D (Reaffirmed) Rupee Term Loan 35270 CRISIL D (Reaffirmed) Short Term Loan 390 CRISIL D (Reaffirmed) Working Capital Term Loan 2990 CRISIL D (Reaffirmed) KINGFISHER AIRLINES: SBICap to e-auction Movable Assets -------------------------------------------------------- The Times of India reports that SBICap Trustee Company has announced an e-auction of all the movable assets of Kingfisher Airlines located at the international airport at Mumbai in a bid to recover the airlines outstandings of INR6,963 crore plus interest. TOI says the movable items include over forty service vehicles such as tractors, tempos, cars, aircraft pullers and other equipment relating to the airline industry. However, given the derelict state the reserve price has been fixed at INR65 lakh. According to the report, the auction will be conducted on December 7 between 11:00 a.m. to 1:00 p.m. The company has named KAL as the borrower and Vijay Mallya and United Breweries Holdings as guarantors, the report relates. TOI reports that the bankers said although the reserve price does not cover even one day's interest, this is a process that needs to complete. In terms of the due process the lenders have to dispose the assets through an auction to the highest bidder. Compared to the size of the loan, realisable value of security with banks is very low, the report notes. According to the report, the highest value among the tangible assets pertains to Kingfisher House -- a 17,000 square foot office property near Mumbai airport and Kingfisher Villa -- a bungalow in Goa. Although KFA was at one time the largest airline, the fleets are lease financed and most of the loans were advanced against guarantee of UBHL and on the strength of the Kingfisher brand, the report states. About Kingfisher Airlines Headquartered in Mumbai, India, Kingfisher Airlines -- http://www.flykingfisher.com/-- formerly known as Deccan Aviation Ltd., served about 35 domestic destinations with a fleet of more than 40 aircraft, including Airbus jets and ATR 72 turboprops. As reported in the Troubled Company Reporter-Asia Pacific on Jan. 15, 2014, Bloomberg News said Kingfisher has grounded planes since October 2012. The airline lost its operating license in January last year after failing to convince authorities it has enough funds to restart flights. The airline defaulted on payments to lessors, creditors and airports as losses widened amid rising fuel costs and competition. According to Bloomberg News, Mr. Mirpuri said in an e-mail on January 13 the airline continues its efforts to recapitalize and restart services. As reported in the TCR-AP on May 18, 2015, CRISIL's ratings on bank loan facilities of Kingfisher Airlines Ltd (KFAL) continue to reflect delays by KFAL in servicing its debt; the delays have been caused by the company's weak liquidity and continued losses at the operating level. Losses in the past seven years have resulted in a complete erosion of KFAL's net worth, leading to its weak financial risk profile. Presently, the company does not carry out any commercial operations. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Cash Credit 8940 CRISIL D (Reaffirmed) Funded Interest Term Loan 2260 CRISIL D (Reaffirmed) Long Term Loan 5970 CRISIL D (Reaffirmed) Rupee Term Loan 35270 CRISIL D (Reaffirmed) Short Term Loan 390 CRISIL D (Reaffirmed) Working Capital Term Loan 2990 CRISIL D (Reaffirmed) LAMB CERAMICS: ICRA Suspends B Rating on INR3cr Cash Credit ----------------------------------------------------------- ICRA has suspended the long term rating of [ICRA]B assigned to the INR3.00 crore cash credit facility and INR2.00 crore term loan facility of Lamb Ceramics Private Limited. ICRA has also suspended the short term rating of [ICRA]A4 assigned to the INR0.75 crore short-term non-fund based facility of LCPL 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 ---------- ----------- ------- Cash Credit 3.00 [ICRA]B suspended Term Loans 2.00 [ICRA]B suspended Bank Guarantee 0.75 [ICRA]A4suspended Incorporated in 2009, Lamb Ceramics Private Limited (LCPL) is engaged in manufacturing of ceramic wall tiles with its production facility located at New Dhuva in Rajkot district of Gujarat. The company has production capacity of 21,000 metric tonnes per annum (MTPA) and currently manufactures digitally printed ceramic wall tiles of three sizes 10"X13", 18"X12" and 12"X12". The company has established two brands namely "Lamb" and "Sco" for selling its products in the market. LICHCHHWI FOOD: Ind-Ra Assigns 'IND B+' Long-Term Issuer Rating --------------------------------------------------------------- India Ratings and Research (Ind-Ra) has assigned Lichchhwi Food India Pvt. Ltd. (LFIPL) a Long-Term Issuer Rating of 'IND B+'. The Outlook is Stable. KEY RATING DRIVERS The ratings reflect LFIPL's small scale of operation and moderate credit profile. In FY15, revenue was INR100m, operating EBITDAR margins of 24.2%, interest coverage (operating EBITDA/gross interest expense) was 1.5x and net financial leverage (total Ind- Ra adjusted net debt/operating EBITDAR) was 6.9x. The ratings also factor in LFIPL's tight liquidity as reflected in its 99% average working capital limit utilisation during the 12 months ended October 2015. The ratings, however, benefit from the two-decade-long experience of LFIPL's directors in the cold storage industry. RATING SENSITIVITIES Positive: A substantial increase in the scale of operations while maintaining the profitability leading to a sustained improvement in the credit profile will lead to a positive rating action. Negative: A substantial decline in the revenue or profitability resulting in sustained deterioration in the credit profile will lead to a negative rating action. COMPANY PROFILE Incorporated in 1998, LFIPL runs a 13,500MT multipurpose cold storage and a 500MT frozen unit at Hajipur Vaishali, Bihar. LFIPL is managed by Mr. Avinash Kumar and Mr Arun Kumar Singh. LIMTEX AGRI: ICRA Lowers Rating on INR23cr Cash Loan to B+ ---------------------------------------------------------- ICRA has revised the long term rating for the INR23.00 crore fund based facilities, and INR0.40 crore non fund based facilities of Limtex Agri Udyog Limited, from [ICRA]BB+ to [ICRA]B+. ICRA has also revised the short term rating for the INR8.00 crore non fund based facilities of the company from [ICRA]A4+ to [ICRA]A4. The ratings on the unallocated limits of INR0.11 crore have also been revised to [ICRA]B+/[ICRA]A4 from [ICRA]BB+/[ICRA]A4+. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Fund Based-cash 23.00 Downgraded to [ICRA]B+ Credit Non Fund based- 0.40 Downgraded to [ICRA]B+ Bank Guarantee Non Fund based- Letter of Credit 8.00 Downgraded to [ICRA]A4 Unallocated 0.11 Downgraded to [ICRA]B+/ [ICRA]A4 The revision in the ratings considers the deterioration in the financial risk profile of the Limtex group as a whole, primarily the flagship company Limtex India Limited (rated at [ICRA]D/D), which incurred significant cash losses during FY15 primarily due to increase in tea procurement cost relative to its realization. The ratings also factor in the decline in the operating profit margins of Limtex Agri Udyog Limited during FY2015 on account of increase in input costs. In addition, the highly working capital intensive nature of operations continues to put pressure on the liquidity position of the company. The ratings also continue to factor in the experience of the promoters in the tea industry. LAUL was incorporated as a private company in 2003, by Mr. Gopal Poddar. The company owns a bought leaf tea plant and is primarily engaged in manufacturing of CTC variety of tea as well as blending and trading of tea in the domestic market. The factory is located at Bidhan Nagar, Siliguri with a total installed capacity of 30 lakh kgs per annum. Recent Results The company reported an operating income (OI) of INR126.78 crore and a net profit of INR0.25 crore during FY15 as compared to an OI of INR115.08 crore and a PAT of INR0.91 crore during FY14. N.S.K. BUILDERS: CRISIL Reaffirms B Rating on INR150MM Cash Loan ---------------------------------------------------------------- CRISIL's ratings of the bank facilities of N.S.K. Builders Private Limited (NBPL) continue to reflect high working capital intensity of operations, exposure to risks related to tender-based nature of business and vulnerability of operating margin to fluctuations in prices of input materials and to the nature of work undertaken. These rating weaknesses are partially offset by the extensive experience of the promoters in the construction industry. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Bank Guarantee 270 CRISIL A4 (Reaffirmed) Cash Credit 150 CRISIL B/Stable (Reaffirmed) Open Cash Credit 80 CRISIL B/Stable (Reaffirmed) For arriving at the ratings, CRISIL has treated unsecured loans of INR297.9 million from promoters as on March 31, 2015 as neither debt nor equity. This is because these loans are subordinated to bank debt and the management has issued an undertaking to this effect to State Bank of India. Outlook: Stable CRISIL believes NBPL will continue to benefit over the medium term from the extensive industry experience of its promoters. The outlook may be revised to 'Positive', in case of improvement in the working capital cycle with substantial reduction in debtors, and if there is a significant increase in scale of operations and operating profitability, leading to a better financial risk profile. Conversely, the outlook may be revised to 'Negative' in case of substantial debt-funded capital expenditure, or a decline in revenue and operating profitability, or lengthening of the working capital cycle, leading to deterioration in the financial profile. Update Sales grew at the healthy rate of 70 per cent year-on-year to INR1045 million in 2014-15 (refers to financial year, April 1 to March 31). The growth was largely on account of new higher value orders bagged from Neyveli Lignite Corporation Ltd (rated 'CRISIL AAA/Stable') and the Maravanthe break-water project. However, margins declined on account of increasing material and labour costs and changes in nature of work undertaken, leading to cash accrual remaining at INR40-50 million. CRISIL expects strong revenue growth over the medium term backed by a healthy order book of over INR1800.0 million currently; however, margins will remain vulnerable to raw material prices and nature of work. Operations remain highly working capital intensive as reflected in gross current assets of 279 days as on March 31, 2015. Working capital requirement will remain large over the medium term due to the nature of business. Equity infusion in 2014-15 led to improvement in the financial risk profile. Networth increased to INR300.0 million as on March 31, 2015, from INR150.0 million a year earlier; this led to an improvement in gearing and debt protection metrics. Though the promoters' funds (equity and unsecured loans) have supported the liquidity, the company's bank line remains highly utilised due to working capital-intensive operations. CRISIL believes though the financial risk profile will remain healthy over the medium term, liquidity will remain stretched due to large working capital requirement. NBPL was originally established in 1996 as a partnership firm, which was reconstituted as a private limited company with the current name in 2010. It undertakes civil construction for various large infrastructure projects such as roads, break water projects. The company is promoted by Mr. N S K Kalairaja and Mr. N S K Karunairaja. NAINANI MEDICO: CRISIL Reaffirms B+ Rating on INR55MM Cash Loan --------------------------------------------------------------- CRISIL's rating on the long-term bank facilities of Nainani Medico (NMD) continues to reflect NMD's weak financial risk profile because of a high total outside liabilities to tangible net worth (TOLTNW) ratio and small scale of operations. These weaknesses are partially offset by the proprietor's extensive experience in the trading of pharmaceutical products and the firm's established distribution network. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Cash Credit 55 CRISIL B+/Stable (Reaffirmed) Overdraft Facility 4 CRISIL B+/Stable (Reaffirmed) Outlook: Stable CRISIL believes NMD will continue to maintain its business risk profile, backed by its proprietor's extensive experience. The outlook may be revised to 'Positive' if the firm improves its financial risk profile driven by an increase in the scale of operations leading to increase in cash accrual or fresh capital infusion. Conversely, the outlook may be revised to 'Negative' if NMD's liquidity deteriorates because of an increase in the working capital requirements or its financial risk profile weakens because of capital withdrawal by the proprietor. NMD was set up in 1988 by Mr. Laxman Nainani. It is a sole proprietorship firm based in Kota (Rajasthan). The firm is a distributor of pharmaceutical products in Kota. OM COTEX: ICRA Reaffirms B+ Rating on INR18cr Cash Loan ------------------------------------------------------- The rating of [ICRA]B+ has been reaffirmed for the INR18.00 crore fund based cash credit facility and also assigned a long-term rating of [ICRA]B+ to the term loan facility of INR3 crore of OM Cotex. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Cash Credit 18.00 [ICRA]B+; reaffirmed Term Loan 3.00 [ICRA]B+; assigned Key Rating Considerations Credit Strengths * Long standing experience of promoters in the cotton ginning business. * Strategic location of the plant in the cotton producing belt of India giving it easy access to raw cotton Credit Concerns * De-growth of operating income in FY 2015 * Financial profile of the firm characterized by low profitability, moderate gearing levels and weak coverage indicators. * Profitability is vulnerable to movements of agricultural produce prices which are subject to seasonality and crop harvest. * Limited value addition and highly competitive & fragmented industry structure due to low entry barriers leads to low operating and net margins. * Partnership firm, any substantial withdrawal from capital accounts would impact the net worth and thereby the gearing levels. Rating Rationale The rating continues to be constrained by the OC's weak financial profile as reflected by low profitability, moderate gearing levels and weak coverage indicators. The rating also takes into account de-growth in operating income in FY 2015. The rating is further constrained by low value additive nature of operations, vulnerability of profitability to adverse fluctuations in raw material prices and intense competition on account of fragmented industry structure that exerts pressure on profit margins. The rating, however, positively considers the long experience of the promoters in the cotton ginning and pressing industry. The rating also favourably considers the advantage firm enjoys by virtue of its location in cotton producing region giving it easy access to raw cotton. Business Risk Profile OM Cotex is engaged in the business of cotton ginning and pressing of raw cotton to produce cotton bales and cotton seeds. The firm was equipped with 36 ginning machines and 1 automatic pressing machine. Later on in FY 2015 the firm purchased 36 ginning machine and 1 pressing machine with total capex of INR3.02 crore. The capex was funded though term loans of INR2.34 crore and remaining through promoters own fund and internal accruals. The capacity utilization (assuming 200 days of operations per year) has remained low at ~ 35% for cotton bales during FY 2015. The firm derives majority of revenue from cotton bales (~74%) and cotton seeds (~26%). Most of the sales are made through a network of brokers with majority of sales being made to merchant exporters. The firm also does trading of cotton bales and cotton seeds. The firm mainly deals in S-6 variety of raw cotton which is procured from local farmers and also from APMC. The firm's location in Rajkot district - Gujarat, an area with high output of cotton crop provides it with easy access to high quality raw cotton. However, as the production is carried out on a rolling stock basis without confirmed orders, the margins remain exposed to volatility in cotton prices. The cotton ginning industry is highly fragmented with presence of large number of players operating within Gujarat resulting in high competitive intensity. The industry is also exposed to regulatory risks with the Government imposing a Minimum Support Price (MSP) for purchase of raw cotton during over supply in the market and restricting export of cotton in order to save the related domestic manufacturing industry. Financial Risk Profile Revenue & Profitability OC has reported an operating income of INR133.73 crore in FY 2015 as against operating income of INR163.86 crore in FY 2014 on account of decline in sales volume as well as decline in sales realisation. As inherent in cotton ginning business, the operating margin of the firm has remained low for the analyzed period. The operating margin of the firm for FY 2015 stood at 1.58% on account of low value addition and high competitive intensity due to fragmented industry structure. The net margins of the firm have also slightly improved to 0.53% in FY 2015 from 0.32% in FY 2014. ROCE and RONW remain low at 8.82% and 11.44% in FY 2015 respectively. Capital Structure & Liquidity The cotton ginning business is working capital intensive with most of the funds blocked in inventory since the raw cotton is required to be procured and stored during the cotton harvesting season. Hence the capital structure of the firm comprises of working capital of INR17.45 crore, term loan of INR1.59 crore and unsecured loans from related parties of INR2.24 crore as on 31st March 2015. Total debt of the firm has remained high due to high working capital borrowing as on March 31, 2015. Gearing of the firm declined from 2.94 times in FY 2014 to 2.71 times in FY 2015 on account of increased net worth. Modest operating profitability, coupled with high debt levels have translated into weak interest coverage indicator for the firm with OPBDIT/ I & F of 1.55 times and Total debt/OPBDIT of 10.05 times for FY 2015. Prospects Going forward, the firm's ability to improve profitability and capital structure, given the seasonality of the business, volatility in prices of cotton, high competitive intensity and uncertain regulatory scenario, will remain critical to the credit profile of the firm. Established in 2011, OM Cotex is engaged in cotton ginning and pressing operations. The firm is currently managed by Mr. Nitesh Bhuva, Mr. Rajesh Kasundra, Mr. Pankaj Lalakiya and Mr. Rajesh Ghodasara. The firm has 72 ginning machines and 2 pressing machine and operates from its manufacturing facility located at Rajkot, Gujarat. Recent Results For the year ended 31st March, 2015, OC reported an operating income of INR133.73 crore and profit after tax of INR0.71 crore. PARAMOUNT WHEELS: ICRA Reaffirms B Rating on INR16cr LT Loan ------------------------------------------------------------ ICRA has reaffirmed the long-term rating of [ICRA]B assigned to the INR16.00 crore (enhanced from INR12.00 crore) bank facilities of Paramount Wheels Private Limited. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long-term fund based facilities 16.00 [ICRA]B reaffirmed The reaffirmation of rating takes into account the company's association with Maruti Suzuki India Limited (MSIL), which is the market leader in the passenger car segment in India. The rating also takes cognisance of the relatively large catchment area for the company's outlets in Mumbai suburban region and its diversified revenue stream across sales, services and spares. Nonetheless, the rating continues to remain constrained by the company's thin operating margins (2.93% during FY2015) on account of weak bargaining power in the automobile dealership business, leveraged capital structure (gearing of 7.15x as on March 31, 2015) and weak coverage indicators. The rating also takes into account the intense competition from established and new MSIL dealers in Mumbai as well as from dealers of other OEMs and vulnerability of the sales to the cyclicality of the passenger vehicle industry. Going forward, the company's ability to improve its capital structure and margins would be the key sensitivities. Paramount Wheels Private Limited is an authorized dealer of MSIL and is promoted by Mr Rajeev Arora and Mr. Sanjeev Arora. The company was incorporated in 2010 and began its operations in March 2011. The company has its outlets in suburban region of Mumbai. PWPL has two showrooms and a body shop in Mira Road, one showroom and a workshop in Wada, one workshop in Goregaon and a True Value outlet in Dahisar. Recent Results As per the audited results for FY2015, PWPL reported a profit after tax (PAT) of INR0.12 crore on an operating income of INR89.01 crore as against PAT of INR0.17 crore on an operating income of INR79.90 crore during the previous year. PEARL INTERNATIONAL: Ind-Ra Assigns 'IND BB' LT Issuer Rating ------------------------------------------------------------- India Ratings and Research (Ind-Ra) has assigned Pearl International Tours and Travels Limited (PITTL) a Long-Term Issuer Rating of 'IND BB. The Outlook is Stable. KEY RATING DRIVERS The ratings factor in PITTL's moderate scale of operations, credit metrics and EBITDA margins. In FY15, revenue stood at INR288.53m, EBITDA margins at 8.79%, gross coverage (operating EBITDA/gross interest expense) at 2.43x and gross leverage (total Ind-Ra adjusted debt/operating EBITDAR) at 3.45x. The ratings also reflect PITTL's tight liquidity position as reflected in 97% average utilisation of working capital facility during the 12 months ended September 2015. PITTL's margins improved to 8.79% in FY15 (FY14: 7.24%) as the company shifted its focus towards high-margin direct corporate sales. This is likely to further benefit the profitability over the short to medium term. The ratings are also supported by the over two decades of experience of PITTL's promoters in the same line of business. RATING SENSITIVITIES Negative: A significant decline in the EBITDA margins leading to deterioration in the credit metrics will be negative for the ratings. Positive: A sustained increase in the EBITDA margins along with improving and/or maintaining the credit metrics will be positive for the ratings. COMPANY PROFILE PITTL was incorporated in 1990 and operates as a travel agent. Its headquarter is located in New Delhi and it has branches in Lucknow, Jaipur and Chandigarh. It operates through two modes i.e. through local travel agents and by directly catering to corporates. PITTL also operates as a Lufthansa City Centre for the Delhi region. PRATEEK ALLOYS: ICRA Withdraws B Rating on INR5.0cr Loan -------------------------------------------------------- ICRA has withdrawn the long term rating of [ICRA] B assigned to the INR5.0 crore, fund-based working capital facilities, and short term rating of [ICRA]A4 assigned to INR7.40 crore, non-fund based bank facilities of Prateek Alloys Private Limited, as the notice period of three years since suspension of rating has expired. RENUKA CONSTRUCTIONS: CRISIL Reaffirms B Rating on INR100MM Loan ---------------------------------------------------------------- CRISIL's rating on the long-term bank loan facility of Renuka Constructions - Pune (RC) continues to reflect RC's exposure to risks related to implementation of projects, given their initial stage of execution, and low customer booking. The rating also factors in susceptibility to risks and cyclicality inherent in the Indian real estate industry. These weaknesses are partially offset by promoter's extensive experience and established track record in the real estate sector and his funding support to the firm. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Project Loan 100 CRISIL B/Stable (Reaffirmed) Outlook: Stable CRISIL believes RC will benefit over the medium term from promoter's extensive industry experience and funding support. The outlook may be revised to 'Positive' if cash inflow improves with timely project completion and healthy customer booking. Conversely, the outlook may be revised to 'Negative' if liquidity is constrained by time or cost overruns in project, or in case of significantly low customer advances resulting in low cash inflow, or if the firm simultaneously undertakes large debt-funded projects. RC is a proprietorship firm set up by Mr. Babu Mhehtre in 1993-94 (refers to financial year, April 1 to March 31). The firm develops real estate in Pune. It has three ongoing projects: Renuka Gulmarg Phase II, Renuka Tulsi, and Sai Mouli. SHREE SATSANGI: CRISIL Reaffirms B- Rating on INR101.5MM Loan ------------------------------------------------------------- CRISIL's rating continues to reflect Shree Satsangi Saket Dham Ram Ashram (SSSDRA)'s modest net worth and exposure to regulatory risks. These rating weaknesses are partially offset by the growing demand for technical education courses, and the established track record of SSSDRA's institutes in the Mehsana (Gujarat) region. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Rupee Term Loan 101.5 CRISIL B-/Stable (Reaffirmed) Outlook: Stable CRISIL believes that SSSDRA will continue to benefit over the medium term from the growing demand for technical and higher education in India. The outlook may be revised to 'Positive' in case of significant increase in turnover and stable profitability, leading to improved liquidity. Conversely, the outlook may be revised to 'Negative' if a material decline in operating profitability or any large debt-funded capital expenditure weakens the financial risk profile. SSSDRA was set up as a trust in 2001 by Mr. Bharatbhai Rao and his family. It operates KJ College of Pharmacy, KJ Institute of Management, and KJ Institute of Engineering and Technology, offering bachelors and masters courses in pharmacy, management, and engineering. SONI GINNING: Ind-Ra Assigns 'IND B+' Long-Term Issuer Rating ------------------------------------------------------------- India Ratings and Research (Ind-Ra) has assigned Soni Ginning Factory (SGF) a Long-Term Issuer Rating of 'IND B+'. The Outlook is Stable. The agency has also assigned SGF's INR60m fund-based working capital limits a Long-term 'IND B+' rating with Stable Outlook. KEY RATING DRIVERS The ratings reflect SGF's small scale of operations and moderate financial profile. In FY15, the company's revenue was INR233m, EBITDA margins were 4.4%, gross interest coverage was 1.4x and net leverage (net debt/EBITDA) was 7.5x. SGF's liquidity is comfortable with around 46% average utilisation of the fund-based limits over the six months ended October 2015. The ratings though benefit from the company's founders' experience of over three decades in the cotton ginning business. RATING SENSITIVITIES Positive: A positive rating action could result from a substantial improvement in the scale of operations along with an improvement in the credit metrics. Negative: A negative rating action could result from deterioration in the credit metrics. COMPANY PROFILE SGF is a Sendhwa-based cotton ginning factory, manufacturing raw cotton seeds and lint with a production capacity of 200 bales per day. SRITHIK ISPAT: ICRA Withdraws D Rating on INR6cr Loan ----------------------------------------------------- ICRA has withdrawn the long term rating of [ICRA]D assigned to the INR6.0 crore, fund-based working capital facilities, and short term rating of [ICRA]D assigned to INR18.8 crore, non-fund based bank facilities of Srithik Ispat Private Limited , as the notice period of three years since suspension of rating has expired. SRITHIK ROLLING: ICRA Withdraws B Rating on INR7.09cr Loan ---------------------------------------------------------- ICRA has withdrawn the long term rating of [ICRA]B assigned to the INR7.09 crore , fund-based working capital and term loan facilities, and short term rating of [ICRA]A4 assigned to INR2.80 crore, non-fund based bank facilities of Srithik Rolling Private Limited , as the notice period of three years since suspension of rating has expired. SRV TELECOM: CRISIL Assigns B Rating to INR90MM Cash Loan --------------------------------------------------------- CRISIL has revoked the suspension of its ratings on the bank facilities of SRV Telecom Private Limited (SRV) and assigned its 'CRISIL B/Stable/CRISIL A4' ratings to the facilities. CRISIL had, on December 15, 2014, suspended the ratings as SRV had not provided the necessary information required for a rating review. The company has now shared the requisite information, enabling CRISIL to assign ratings to the bank facilities. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Bank Guarantee 25 CRISIL A4 (Assigned; Suspension Revoked) Cash Credit 90 CRISIL B/Stable (Assigned; Suspension Revoked) Letter of Credit 10 CRISIL A4 (Assigned; Suspension Revoked) The ratings reflect SRV's weak financial risk profile because of an aggressive capital structure, and stretched liquidity due to working capital-intensive operations. The rating also factors in a modest scale of operations. These rating weaknesses are partially offset by the extensive industry experience of the company's promoters and established relationship with its customer, TTK Prestige Ltd. Outlook: Stable CRISIL believes SRV will continue to benefit over the medium term from promoters' extensive industry experience and established relationship with its key customer. The outlook may be revised to 'Positive' in case of long-term fund infusion or larger-than- expected accrual from the company's induction cook-top business, leading to better liquidity. Conversely, the outlook may be revised to 'Negative' in case of a stretched working capital cycle, leading to further pressure on liquidity, or large debt- funded capital expenditure. SRV, based in Bengaluru and promoted by Mr. E K Surendran, was incorporated in 1995. It started operations as a manufacturer of telecom equipment and electronic products such as phones with caller identification, electronic push-button telephones, fixed wireless telephones, patch cords and pigtails, and coin box telephones. Owing to irregularities in the telecom sector and slower realisation of dues from its telecom customers, the company entered into the consumer durables segment in 2011-12 (refers to financial year, April 1 to March 31). It manufactures induction cook-tops for TTK Prestige and others. TIRUPATI CORRUGATORS: CRISIL Reaffirms D Rating on INR77.5MM Loan ----------------------------------------------------------------- CRISIL's rating on the bank facilities of Tirupati Corrugators (TC) continues to reflect delay by TC in servicing its term loan; the delays have been caused by liquidity pressures faced by TC resulting from stretched working capital cycle. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Bank Guarantee 14 CRISIL D (Reaffirmed) Cash Credit 77.5 CRISIL D (Reaffirmed) Term Loan 59.2 CRISIL D (Reaffirmed) The rating also reflects TC's modest scale of operations, working capital intensive operations and weak financial risk profile marked by a modest net worth base and high gearing. These rating weaknesses are partially offset by the extensive industry experience of TC's proprietor in the corrugated boxes industry and its diversified customer base. TC was set up as a proprietorship concern in 2009 by Mrs. Mangla Bangur; and commenced its commercial operations from October 2010. TC is engaged in manufacturing of corrugated boxes using kraft paper. TC overall operations are looked after by Mr. Anand Bangur. TPP BOILERS: ICRA Suspends B+ Rating on INR2cr Loan --------------------------------------------------- ICRA has suspended [ICRA]B+ rating assigned to the INR2.00 crore fund based facilities and [ICRA]A4 rating assigned to the INR3.75 crore, short term non-fund based facilities of TPP Boilers Pvt. Ltd. The suspension follows ICRA's inability to carry out a rating surveillance in the absence of the requisite information from the company. TPP Boilers Pvt. Ltd. was incorporated in the year 2009 by Mr. Himanshu Desai, Mr. A. N. Pandey and Mr. Kalpanath Pande. The company is engaged in the business of fabrication of high temperature steam boiler pressure parts like economizer coils, superheater coils, studded coils, water wall panels, etc. The company has its fabrication work shop in Vadodara (Gujarat). TVC ELECTRONICS: CRISIL Assigns B+ Rating to INR40MM Cash Loan -------------------------------------------------------------- CRISIL has assigned its 'CRISIL B+/Stable' rating to the long-term bank facilities of TVC Electronics (TVC). Amount Facilities (INR Mln) Ratings ---------- --------- ------- Standby Line of Credit 5 CRISIL B+/Stable Cash Credit 40 CRISIL B+/Stable Proposed Long Term Bank Loan Facility 25 CRISIL B+/Stab The rating reflects a modest scale, and working capital-intensive nature, of operations, below-average financial risk profile constrained by a small net worth and weak interest coverage. The ratings also factor in the firm's small operating margins which are susceptible to intense industry competition. These rating weaknesses are partially offset by the extensive industry experience of the firm's promoter and its established position in the consumer electronics retail market in Tamil Nadu. Outlook: Stable CRISIL believes TVC will continue to benefit over the medium term from its promoter's extensive industry experience and its established market position. The outlook may be revised to 'Positive' in case of significant and sustained improvement in revenue and profitability, leading to large cash accrual, coupled with a better working capital cycle. Conversely, the outlook may be revised to 'Negative' in case of lower-than-expected revenue and profitability, or large, debt-funded capital expenditure, or lengthening of the working capital cycle, resulting in deterioration in the firm's financial risk profile, particularly liquidity. Established as a proprietorship firm in 1992, TVC retails consumer durables (white goods and small home appliances) through five outlets spread across Tamil Nadu. Based in Neyveli (Tamil Nadu), the firm is promoted by Mr. S G Ajith Kumar. In 2014-15 (refers to financial year, April 1 to March 31), TVC, on a provisional basis, had a profit after tax (PAT) of INR1.9 million on net sales of INR291 million; it had a PAT of INR1.5 million on net sales of INR204 million in 2013-14. VIDHATRI EXPORTS: CRISIL Cuts Rating on INR60MM Loan to B- ---------------------------------------------------------- CRISIL has downgraded its rating on the long-term bank facility of Vidhatri Exports Private Limited (VEPL) to 'CRISIL B-/Stable' from 'CRISIL B/Stable'. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Export Packing 60 CRISIL B-/Stable (Downgraded Credit from 'CRISIL B/Stable') The downgrade reflects the weakening of VEPL's liquidity because of an operating loss, and a stretch in the working capital cycle resulting in almost full utilisation of bank limits. CRISIL believes the company will need to register a substantial increase in cash accrual, or a sustained improvement in the working capital cycle, to alleviate the pressure on liquidity. VEPL incurred an operating loss of INR20 million in 2014-15 (refers to financial year, April 1 to March 31) on revenue of INR809 million. The loss is on account of intensifying competition and increased overhead costs. Also, there has been a stretch in the working capital cycle, as reflected in an increase in receivables, leading to almost full utilisation of bank limits over the six months through October 2015. The rating continues to reflect the weak financial risk profile because of small net worth, high gearing, and weak debt protection metrics. The rating is also constrained by large working capital requirement, and exposure to intense competition in the textile industry. These rating weaknesses are partially offset by the extensive experience of promoters in the textile industry. Outlook: Stable CRISIL believes VEPL will continue to benefit over the medium term from the promoters' extensive industry experience. The outlook may be revised to 'Positive' in case of cash profits, or a sustained improvement in the working capital cycle. Conversely, the outlook may be revised to 'Negative' in case of a steep decline in profitability margins, or deterioration in the capital structure caused most likely by a large, debt-funded capital expenditure, or a stretch in the working capital cycle. VEPL was set up in 2006 as a partnership firm by the Gujarat-based Poddar family. The company exports dyed and printed fabric. It is based in Mumbai. VIRAJ SYNTEX: CRISIL Assigns B+ Rating to INR41.5MM Loan -------------------------------------------------------- CRISIL has assigned its 'CRISIL B+/Stable/CRISIL A4' rating to the long-term bank facilities of Viraj Syntex Pvt Ltd (VSPL). Amount Facilities (INR Mln) Ratings ---------- --------- ------- Term Loan 12.1 CRISIL B+/Stable Proposed Long Term Bank Loan Facility 27.9 CRISIL B+/Stable Packing Credit 13.5 CRISIL A4 Inland/Import Letter of Credit 10 CRISIL A4 Cash Credit 41.5 CRISIL B+/Stable Inland Guarantees 5 CRISIL A4 The rating reflects VSPL's modest scale of operations and average financial risk profile marked by high gearing. The rating also reflects working-capital-intensive operations. These weaknesses are partially offset by the extensive industry experience of VSPL's promoters. Outlook: Stable CRISIL believes VSPL will continue to benefit over the medium from promoters' extensive experience. The outlook may be revised to 'Positive' if VSPL improves its capital structure either by equity infusion or higher-than-expected cash accruals, backed by improvement in scale of operations along with prudent working capital management. Conversely, the outlook may be revised to 'Negative' if VSPL's financial risk profile deteriorates on account of further decline in its revenues and profitability or in case of a larger-than-expected, debt-funded capital expenditure, or if its liquidity weakens significantly on account of increase in its working capital requirements. VSPL was incorporated in 1994, promoted by members of the Kanpur (Uttar Pradesh)-based Kohli family. It manufactures safety harness and slings for the infrastructure and defence sectors, and caters to both the domestic and global markets. The company is managed by Mr. Rahul Kohli and Ms. Ruchi Kohli. XPLORE LIFESTYLE: CRISIL Cuts Rating on INR90MM LT Loan to B ------------------------------------------------------------ CRISIL has downgraded its rating on the long-term bank facilities of Xplore Lifestyle Solutions Private Limited (Xplore) to 'CRISIL B/Stable' from 'CRISIL B+/Stable'. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Cash Credit 35 CRISIL B/Stable (Downgraded from 'CRISIL B+/Stable') Proposed Long Term 90 CRISIL B/Stable (Downgraded Bank Loan Facility from 'CRISIL B+/Stable') The downgrade reflects continued pressure on Xplore's business risk profile because of increasing working capital requirement and a decline in revenue. Operating income declined by 18 per cent in 2014-15 over the previous year to INR68.4 million because of subdued demand from end customers. However, the working capital requirement increased in 2014-15, because of a substantial increase in inventory and debtors. Gross current assets rose to 534 days as on March 31, 2015, from 376 days in the previous year, mainly because of high inventory and debtors of 443 days and 137 days. CRISIL believes Xplore's liquidity will remain under pressure over the medium term because of small accrual and large working capital requirement. The rating reflects Xplore's modest scale of operations with large working capital requirement, and below-average financial risk profile because of modest net worth and weak debt protection metrics. These rating weaknesses are partially offset by the extensive experience of Xplore's promoters in the fitness equipment trading business, and funding support from them. Outlook: Stable CRISIL believes Xplore will continue to benefit over the medium term from the promoters' extensive industry experience and their funding support. The outlook may be revised to 'Positive' if significant growth in revenue, along with sustained improvement in the working capital cycle, results in sizeable net cash accrual. Conversely, the outlook may be revised to 'Negative' in case of further pressure on the liquidity owing to low cash accrual, large working capital requirement, or large, debt-funded capital expenditure. Established in 2010, Xplore is a distributor of fitness and healthcare equipment. The company, owned and managed by Mr. Pankaj Balwani and his family members, is headquartered at Pune (Maharashtra). ========= J A P A N ========= SHARP CORP: Asks All Employees to Buy Company Products ------------------------------------------------------ Japan Today reports that Sharp Corp., currently implementing management reconstruction measures, has asked all of its employees to set a target amount for purchasing the company's products. The company has asked board members and executive officers to spend JPY200,000 on Sharp products; JPY100,000 for employees in management positions, and JPY50,000 for all other employees, Japan Today, citing a Sankei Shimbun report, relates. Furthermore, employees can buy TVs and refrigerators for a special price and get 2% of the total purchase price reimbursed. This program lasts until Jan. 29, 2016, says Japan Today. Japan Today relates that although Sharp said it is not mandatory for employees to comply with the request, the move has been criticized by media observers because employees have to make their purchases through a specific website, so the company can see who buys what. According to Japan Today, Yoshisuke Hasegawa, a senior executive director, wrote in an internal document to employees, and which was leaked to Japanese media: "Please help us get through this difficult situations." Japan Today notes that Sharp on Oct 31 posted a whopping six-month net loss of JPY83.6 billion, hit by restructuring costs and a slump in demand for its smartphone screens. Sharp posted the loss in the half-year through September, down from a small profit a year earlier, while revenue fell 3.6% to JPY1.28 trillion, Japan Today discloses. The liquid-crystal display giant, which is key supplier to Apple and other mobile phone makers, singled out a downturn in smartphone-screen demand in China for its latest set of poor results, according to Japan Today. Earlier this year, Sharp said it was cutting 10% of its 49,000 global workforce as part of a turnaround plan intended to keep it afloat, the report recalls. Japan Today says Sharp earlier announced the sale of the building that houses its Osaka headquarters and issued shares to its banks, in an apparent lifeline that underscored the company's desperate situation. The report notes that the once-mighty firm, like rivals Sony and Panasonic, has been working to move past years of gaping deficits, partly caused by steep losses in its television unit. The trio were hammered by competition from lower-cost rivals, particularly from South Korea and Taiwan, adds Japan Today. Based in Osaka, Japan, Sharp Corporation (TYO:6753) -- http://sharp-world.com/-- manufactures and sells electronic telecommunication devices, electronic machines and components. As reported in Troubled Company Reporter-Asia Pacific on Nov. 6, 2015, Standard & Poor's Ratings Services said that it has lowered its long-term corporate credit and debt ratings on Japan- based electronics company Sharp Corp. to 'CCC+' from 'B-' and its short-term corporate credit and commercial paper program ratings on the company to 'C' from 'B'. S&P has also lowered its long- term corporate credit rating on overseas subsidiary Sharp International Finance (U.K.) PLC to 'CCC+' and the rating on its commercial paper program to 'C'. The outlook on the long-term corporate credit ratings on both companies is negative. VUZIX CORP: Reports $2.81 Million Net Loss for Third Quarter ------------------------------------------------------------ Vuzix Corporation filed with the Securities and Exchange Commission its quarterly report on Form 10-Q disclosing a net loss attributable to common stockholders of $2.81 million on $970,379 of total sales for the three months ended Sept. 30, 2015, compared to a net loss attributable to common stockholders of $3.30 million on $664,586 of total sales for the same period during the prior year. For the nine months ended Sept. 30, 2015, the Company reported a net loss attributable to common stockholders of $11.04 million on $2.20 million of total sales compared to a net loss attributable to common stockholders of $1.55 million on $2.18 million of total sales for the same period a year ago. As of Sept. 30, 2015, the Company had $22.13 million in total assets, $2.74 million in total liabilities and $19.38 million in total stockholders' equity. The Company had cash and cash equivalents of $16,072,222 as of Sept. 30, 2015, an increase of $15,987,255 from $84,967 as of Dec. 31, 2014. A full-text copy of the Form 10-Q is available for free at: http://is.gd/usgeqj About Vuzix Corporation Vuzix -- http://www.vuzix.com/-- is a supplier of Video Eyewear products in the consumer, commercial and entertainment markets. The Company's products, personal display devices that offer users a portable high quality viewing experience, provide solutions for mobility, wearable displays and virtual and augmented reality. Vuzix holds 33 patents and 15 additional patents pending and numerous IP licenses in the Video Eyewear field. Founded in 1997, Vuzix is a public company with offices in Rochester, NY, Oxford, UK and Tokyo, Japan. The net loss for the year 2014 was $7.87 million versus a net loss of $10.1 million in 2013. ==================== N E W Z E A L A N D ==================== TORCHLIGHT FUND: John Grill to Appeal High Court Ruling on Loan --------------------------------------------------------------- Paul McBeth at BusinessDesk reports that Australian businessman John Grill's Wilaci investment unit will appeal a High Court ruling that it wasn't entitled to AUD33.6 million of penalty fees on a short-term loan to Pyne Gould Corp subsidiary Torchlight Fund No 1 LP. BusinessDesk relates that Guernsey-based, NZX-listed Pyne Gould said Wilaci is appealing the New Zealand High Court ruling, which it said "was correct and in accordance with long-established legal principles" and said the appeal was "without merit." The company said it won't comment further until the appeal is concluded, the report relays. BusinessDesk recalls that Justice Matthew Muir last month ruled the Torchlight unit didn't have to pay a late penalty fee on a AUD$37 million loan from Wilaci, which "so significantly exceeds the loss likely to be caused by the breach that it qualifies as extravagant and therefore unenforceable," saying the AUD2.17 million per month fee "was undoubtedly extravagant in relation to any such loss." According to BusinessDesk, Wilaci lent the funds to Torchlight on August 22, 2012, to help the Pyne Gould entity through what managing director George Kerr described as "a very tight liquidity situation" when Bank of Scotland International was exiting Australasia and calling for repayment from its debtors, including Torchlight's Australian real estate investment, RCL Group. A high- profile dispute with the Financial Markets Authority made it more difficult for Mr Kerr to recapitalise Torchlight, the report says. The report relates that Mr. Grill's Wilaci financed its loan by borrowing the funds from Credit Suisse, pledging 3.5 million shares in ASX-listed engineering firm WorleyParsons as collateral. The loan was due to be repaid by October 26, a deadline Torchlight missed, although Wilaci didn't immediately call on the loan, BusinessDesk notes. Rather, it managed the repayment through seven tranches between October 2013 and May 2014. Wilaci served its demand on Torchlight in May 2013, and appointed receivers in June that year, BusinessDesk discloses. BusinessDesk says shortly before the August hearing, Torchlight admitted liability for a AUD5 million fee plus interest, and the judge also ordered the Pyne Gould entity to pay NZ$1.18 million in receivers' costs and disbursements, plus additional costs that had been incurred since July 31. Pyne Gould later said those costs amounted to about NZ$4 million and had been provided for in the company's accounts, the report notes. ==================== S O U T H K O R E A ==================== * SOUTH KOREA: Zombie Companies Spur Restructuring Push ------------------------------------------------------- Jiyeun Lee at Bloomberg News reports that policy makers in Seoul are accelerating efforts to restructure debt-laden and unprofitable companies before an anticipated rise in U.S. interest rates and any further slowdown in China reverberates in South Korea. Falling exports and huge losses among some of Korea's corporate giants have injected urgency into efforts to sell poorly performing assets and raise competitiveness, Bloomberg says. Overseas shipments have dropped every month this year, with notable weakness in sales to China. According to Bloomberg, government ministries, financial regulators and state-run banks have established a committee to oversee corporate restructuring while a review of credit ratings continues for large companies that are at risk of collapse. The government this month identified steel, shipping, shipbuilding, construction and petrochemicals as sectors suffering from oversupply and excessive competition, the report notes. "Back when the economy was roaring, fragile companies were able to survive if they endured just a couple years until the cycle turned for the better," Bloomberg quotes Lee Myong Hwal, a research fellow for the Korea Institute of Finance in Seoul, as saying. "That no longer works in a low-growth era. With looming risks from China and the U.S., we may see companies that survived on debt having serious problems." Bloomberg reports that one of the biggest concerns is so-called "marginal" or "zombie" companies, usually defined in Korea as businesses that haven't been able to make payments on interest from operating profit for three years. A prolonged period of low interest rates has led to an increase in marginal companies and there is an "urgent" need for restructuring, Bank of Korea Governor Lee Ju Yeol said this month, Bloomberg recalls. Financial Services Commission Chairman Yim Jong Yong has warned that unless the problems at these companies are addressed, they will become a burden to the economy. The number of marginal companies jumped to 3,295 last year, from 2,698 in 2009, according to the central bank. They account for 15% of businesses with more than KRW10 billion ($8.6 million) of assets, Bloomberg discloses. ********* Tuesday's edition of the TCR-AP delivers a list of indicative prices for bond issues that reportedly trade well below par. Prices are obtained by TCR-AP editors from a variety of outside sources during the prior week we think are reliable. Those sources may not, however, be complete or accurate. The Tuesday Bond Pricing table is compiled on the Friday prior to publication. Prices reported are not intended to reflect actual trades. Prices for actual trades are probably different. Our objective is to share information, not make markets in publicly traded securities. Nothing in the TCR-AP constitutes an offer or solicitation to buy or sell any security of any kind. It is likely that some entity affiliated with a TCR-AP editor holds some position in the issuers' public debt and equity securities about which we report. A list of Meetings, Conferences and Seminars appears in each Wednesday's edition of the TCR-AP. Submissions about insolvency- related conferences are encouraged. Send announcements to conferences@bankrupt.com Friday's edition of the TCR-AP features a list of companies with insolvent balance sheets obtained by our editors based on the latest balance sheets publicly available a day prior to publication. At first glance, this list may look like the definitive compilation of stocks that are ideal to sell short. Don't be fooled. Assets, for example, reported at historical cost net of depreciation may understate the true value of a firm's assets. A company may establish reserves on its balance sheet for liabilities that may never materialize. The prices at which equity securities trade in public market are determined by more than a balance sheet solvency test. ********* S U B S C R I P T I O N I N F O R M A T I O N Troubled Company Reporter-Asia Pacific is a daily newsletter co- published by Bankruptcy Creditors' Service, Inc., Fairless Hills, Pennsylvania, USA, and Beard Group, Inc., Washington, D.C., USA. Valerie U. Pascual, Marites O. Claro, Joy A. Agravante, Rousel Elaine T. Fernandez, Julie Anne L. Toledo, and Peter A. Chapman, Editors. Copyright 2015. All rights reserved. ISSN: 1520-9482. This material is copyrighted and any commercial use, resale or publication in any form (including e-mail forwarding, electronic re-mailing and photocopying) is strictly prohibited without prior written permission of the publishers. Information contained herein is obtained from sources believed to be reliable, but is not guaranteed. TCR-AP subscription rate is US$775 for 6 months delivered via e- mail. Additional e-mail subscriptions for members of the same firm for the term of the initial subscription or balance thereof are US$25 each. For subscription information, contact Peter Chapman at 215-945-7000 or Nina Novak at 202-362-8552. *** End of Transmission ***