/raid1/www/Hosts/bankrupt/TCRAP_Public/151204.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
A S I A P A C I F I C
Friday, December 4, 2015, Vol. 18, No. 240
Headlines
A U S T R A L I A
BELLA TRANSPORT: First Creditors' Meeting Set For Dec. 10
CALLACTIVE: Collapses Into Liquidation; 200 Jobs Axed
COFFS HARBOUR: Administrators Extends North Coast Hotel Deal
EQUITITRUST LIMITED: ASIC Permanently Bans Former CEO
GERALDTON BRICK: First Creditors' Meeting Set For Dec. 10
PLANET PLATINUM: Court Appoints Ferrier Hodgson as Liquidator
C H I N A
CHINA SOUTH: Moody's Revises Outlook on B1 CFR to Negative
FUWEI FILMS: Receives Nasdaq Listing Non-Compliance Notice
HYDOO INTERNATIONAL: Moody's Assigns B2 Corporate Family Rating
HYDOO INTERNATIONAL: S&P Assigns 'B' CCR; Outlook Stable
SUTOR TECHNOLOGY: Receives Nasdaq Listing Non-Compliance Notice
WEST CHINA: Moody's Puts Ba3 CFR Under Review for Upgrade
* Chinese Auto Loan ABS Delinquencies Up in Q3 2015, Moody's Says
I N D I A
ADVANSYS (INDIA): CRISIL Cuts Rating on INR70MM Term Loan to D
AERO TREATMENTS: CRISIL Assigns 'B' Rating to INR67MM LT Loan
AMR GLOBAL: CRISIL Suspends 'D' Rating on INR100MM Bank Loan
AVEDA VENTURES: Ind-Ra Assigns 'IND BB-' Long-Term Issuer Rating
BLUEZONE VITRIFIED: CRISIL Assigns 'B' Rating to INR317MM Loan
HARIWANSH PACKAGING: CRISIL Reaffirms B+ Rating on INR72.5MM Loan
HITECH LITHO: CRISIL Cuts Rating on INR30MM Cash Loan to 'B'
JAY KHODIYAR: CRISIL Assigns 'B' Rating to INR80MM Cash Loan
KALOKHE STONE: CRISIL Ups Rating on INR72MM Term Loan to 'C'
KUN AUTOMOBILES: CRISIL Suspends B+ Rating on INR160MM Loan
LEELA GOLD: CRISIL Assigns B- Rating to INR75MM Cash Loan
MAHARANA PRATAP: CRISIL Assigns B- Rating to INR388MM Term Loan
MAIHAR ALLOYS: CARE Revises Rating on INR9cr LT Loan to B+
MALWA FRESH: CRISIL Assigns B- Rating to INR127.7MM Term Loan
MGR AGRO: CARE Upgrades Rating on INR10.64cr LT Loan to BB-
MONNET ISPAT: Lenders to Take Control of Steel Company
P&M AND HI TECH: CRISIL Cuts Rating on INR400MM Loan to 'D'
POLYGENTA TECHNOLOGIES: CARE Reaffirms C Rating on INR9.20cr Loan
PRIDE EAST: CRISIL Assigns B+ Rating to INR50MM LT Loan
RADHIKA INFRA: CRISIL Assigns 'D' Rating to INR135.4MM LT Loan
RAM KUMAR: CRISIL Assigns B+ Rating to INR30MM Overdraft Loan
SAPTHAVARNA BUILDERS: CRISIL Assigns B+ Rating to INR44MM LT Loan
SENATOR MOTORS: CRISIL Cuts Rating on INR220MM Cash Loan to D
SIDHI VINAYAK: CARE Lowers Rating on INR18cr ST Loan to 'D'
SOLACE HEALTHCARE: CRISIL Assigns 'D' Rating to INR187MM Loan
SPM MARBLES: CARE Upgrades Rating on INR7cr LT Loan to BB-
TRAFO POWER: CRISIL Reaffirms B+ Rating on INR65MM Cash Loan
VEERA ASSOCIATES: CRISIL Assigns B+ Rating to INR50MM LT Loan
VENKATADRI SPINNING: CRISIL Cuts Rating on INR88.2MM Loan to D
YOGESH TRADING: CRISIL Suspends B+ Rating on INR350MM Loan
M O N G O L I A
SOUTHGOBI RESOURCES: Meets TSX Continued Listing Requirements
N E W Z E A L A N D
HPH LIMITED: Restaurant Owners Face Liquidation Application
P A K I S T A N
PAKISTAN MOBILE: S&P Affirms 'B-' CCR; Outlook Remains Positive
X X X X X X X X
* Outlook for Asian Cos. Clouded by Subdued Growth, Moody's Says
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A U S T R A L I A
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BELLA TRANSPORT: First Creditors' Meeting Set For Dec. 10
---------------------------------------------------------
Ozem Kassem and Jason Tang of Cor Cordis Chartered Accountants
were appointed as administrators of Bella Transport Pty Limited on
Nov. 30, 2015.
A first meeting of the creditors of the Company will be held at
Cor Cordis Chartered Accountants, Level 6, 55 Clarence Street, in
Sydney, on Dec. 10, 2015, at 10:00 a.m.
CALLACTIVE: Collapses Into Liquidation; 200 Jobs Axed
-----------------------------------------------------
Eloise Keating at SmartCompany reports that a Victorian-based call
centre has collapsed into liquidation, leaving almost 200 workers
out of a job.
SmartCompany relates that workers at the CallActive call centre in
the Melbourne suburb of Bentleigh East were told on Nov. 27 that
the business would be shutting down and they no longer had a job,
according to the Australian Services Union.
The workers are owed up to three weeks' wages as well as unpaid
entitlements such as annual leave and superannuation, the union
said in a statement on Nov. 30, SmartCompany relays.
According to SmartCompany, the union said it will continue to
pursue CallActive management "for answers on the collapse of the
business" and will work with the liquidators to protect the
interests of the workers who have lost their jobs.
Liquidators SV Partners were appointed to the company on Nov. 30,
with Richard Cauchi and Michael Carrafa appointed to manage the
liquidation, the report discloses.
Mr. Cauchi told SmartCompany CallActive had approximately 200
employees at the time it ceased operating and the employees were
terminated prior to his appointment.
"I will be looking for expressions of interest in the assets that
remain," SmartCompany quotes Mr. Cauchi as saying.
However, Mr. Cauchi was unable to comment as to how much the
company was turning over prior to collapsing, SmartCompany says.
CallActive also operated a call centre in Wellington,
New Zealand, and according to SBS, around 60 workers at that call
centre have also lost their jobs, adds SmartCompany.
COFFS HARBOUR: Administrators Extends North Coast Hotel Deal
------------------------------------------------------------
Claudia Jambor at Coffs Coast Advocate reports that administrators
of the Coffs Harbour Deep Sea Fishing Club approved the club's
proposal to extend its Deed of Company Arrangement with the North
Coast Hotel Group.
The report says the extension means the club can fully open its
doors to the public while giving it six months to pay the full
DOCA balance of AUD1.2 million.
According to the report, Coffs Harbour Deep Sea Fishing Club
president, Bill Mabey, said the vote reflected 'resounding
support' from all parties with only one party opposing the
proposal at the final vote.
"It (the proposal) will see the club open even though it might be
on a limited basis but perhaps a bit more than what we've seen in
the past," the report quotes Mr. Mabey as saying. "The extension
releases the funds to re-open the club but more importantly, it
gives us the opportunity to provide benefits to the community and
our members."
Former employees of the club, including former secretary manager
Malcolm Devine were pleased to be able to negotiate a split of
AUD150,000 allocated in the DOCA trust, the report says.
Coffs Coast Advocate relates that the proposal also guarantees
employees will get their payments sooner than anyone else and also
allows former staff to interview for the club as it re-opens for
business.
An amalgamation with Club Coffs, formerly the Catholic Club, is on
the cards with the Deep Sea Fishing Club formally registered as an
administrator with the intention to broaden membership numbers and
possibly inject funds into the club from any Club Coffs
liquidation surplus, the report states.
Tensions grew at the meeting when the 10 year extension of the
club's lease was mentioned in the proposal, according to Coffs
Coast Advocate.
According to Coffs Coast Advocate, Coffs Harbour City Council
director of business services, Andrew Beswick, made a clear stance
the council wasn't going to extend the club's lease.
"I do not see why it is still in there (the proposal) because it's
not going to happen under the advice we have," the report quotes
Mr Beswick as saying. "The circumstances haven't changed when we
received the advice from the minister in July that we have a club
that's become insolvent wishing to have a lease extension and
effectively to use the lease extension as a way to garner more
funds to pay debts of the past.
"Now is that best interest of the trust going forward into the
future? That's the judgement that has to be made but with the
guidance from the minister we have little room to move at this
stage we have no room to move in fact."
Both parties will continue to negotiate an extension of the club's
lease, adds Coffs Coast Advocate.
David Morgan and Morgan Chubb of Clout & Associates were appointed
as administrators of Coffs Harbour Catholic Recreation & Sporting
Club Limited, formerly Trading As Club Coffs on West High, on Aug.
6, 2015.
EQUITITRUST LIMITED: ASIC Permanently Bans Former CEO
-----------------------------------------------------
Australian Securities and Investment Commission has permanently
banned Mark McIvor, former Chief Executive Officer and founding
director of Equititrust Limited, which was the responsible entity
of the Equititrust Income Fund (EIF) and collapsed in 2011.
Mr McIvor, of Labrador, Queensland, is banned from providing any
financial services on the basis that he had contravened a
financial services law and was not of good fame or character to
provide financial services. His conduct involved breaches of the
financial services legislation, which were considered to be very
serious, repetitive, prolonged and dishonest.
An ASIC investigation found that between 1 January 2004 and 18
September 2008, whilst he was the director of the responsible
entity of EIF, Mr. McIvor:
* failed to take all the steps that a reasonable person would
take, if they were in the officer's position, to ensure that
the responsible entity complied with the EIF's compliance
plan; and
* signed 28 board meeting minutes, which falsely recorded a
board meeting to approve a loan application had occurred,
when no such board meetings had taken place.
ASIC Commissioner John Price said "ASIC expects high standards of
honesty and integrity from anyone providing financial services.
Anyone who fails to meet those standards must be excluded from
providing such services."
Mr McIvor has 28 days in which to apply to the Administrative
Appeals Tribunal to review the decision.
Equititrust was incorporated on 18 August 1993 and was placed into
voluntary administration on 15 February 2012. The creditors of
Equititrust resolved that the company should be placed into
liquidation on 20 April 2012.
Equititrust held an Australian Financial Services Licence (AFSL)
and was the responsible entity of two registered schemes, the
Equititrust Income Fund (EIF) and the Equititrust Priority Class
Income Fund (EPCIF). It was also trustee of an unregistered
managed investment scheme, called the Equititrust Premium Fund
(EPF).
The voluntary administrators of Equititrust reported that as at
the date of their appointment:
-- EIF had about 1620 unitholders who were owed approximately
AUD203.6 mil.
-- EPF had about 38 unitholders who were owed approximately
AUD56.7 mil; and
-- EPCIF had 5 unitholders and held no tangible assets.
Mr McIvor was made bankrupt on Nov. 28, 2012.
On Dec. 19, 2011, ASIC suspended the AFSL of Equititrust for 12
months, for failing to comply with a number of key obligations as
a financial services licensee.
On Aug. 22, 2014, Mr McIvor was convicted and fined $10,000 in the
Brisbane Magistrates Court of six charges of failing to provide a
Report as to Affairs and to deliver books and records to the
liquidators of Chevron Capital Pty Ltd, MHSM Holdings Pty Ltd and
SM Capital Pty Ltd.
GERALDTON BRICK: First Creditors' Meeting Set For Dec. 10
---------------------------------------------------------
Dino Travaglini and Bruno A Secatore of Cor Cordis Chartered
Accountants were appointed as administrators of Geraldton Brick
Pty Ltd on Nov. 30, 2015.
A first meeting of the creditors of the Company will be held at
Conference Room, Plaza Level, BGC Centre, 28 The Esplanade, in
Perth, WA, on Dec. 10, 2015, at 10:30 a.m.
PLANET PLATINUM: Court Appoints Ferrier Hodgson as Liquidator
-------------------------------------------------------------
Following Australian Securities and Investment Commission's
successful application to the Supreme Court of Victoria, Ferrier
Hodgson partner John Lindholm has been appointed liquidator to
Planet Platinum Limited by the Court.
Associate Justice Efthim ordered that Planet Platinum be wound up
on just and equitable grounds given the systemic mismanagement of
its affairs. His Honour found that whilst it was a serious step to
wind up a solvent company he was in no doubt that it was in the
public interest.
The orders follow an ASIC investigation into the management of
Planet Platinum, including in relation to a loan made by it to
Metropolis City Promotions Pty Ltd (Metropolis) in the amount of
AUD3,070,600.
The misconduct and mismanagement identified by the Court was
reflected in the many and varied adverse findings made by His
Honour, which included:
* Planet Platinum's failure to have three directors
* Planet Platinum's failure to convene an annual general
meetings for the financial years ending 30 June 2013 and
30 June 2014 or lodge annual reports for those years
* Planet Platinum's failure to lodge a half-year report for
the period ending 31 December 2013 and 31 December 2014
* Planet Platinum's failure to collect the loan from
Metropolis resulting in a financial benefit to related
party Metropolis without the approval of Planet Platinum
members as well as a contravention of the relevant
provisions by director Mr John Trimble (Trimble) himself
* Planet Platinum's failure to inform the market of the
Metropolis loan extensions including a contravention by
Mr Trimble of the continuous disclosure obligations
* various breaches of directors' duties including the failure
to act with due care and diligence, failure to act in good
faith and the failure to act in the best interests of Planet
Platinum regarding various company transactions.
ASIC Commissioner John Price said,'The Judge's decision to back
ASIC's application and appoint a liquidator to wind up Planet
Platinum sends a clear message when it comes to poor company
governance.'
'ASIC won't hesitate to take legal action to stamp out this kind
of risky and illegal company mismanagement.'
Planet Platinum is the owner and operator of Showgirls Bar 20 - an
adult entertainment business located on King Street, Melbourne -
and is the owner of 7-12 Horne Street, Elsternwick from which the
company receives rent from a brothel operated by related entity
trading under the name Daily Planet.
Planet Platinum listed on the Australian Securities Exchange in
April 2003 and its shares have been suspended since March 2013.
In April 2015, ASIC ASIC has applied to the Supreme Court of
Victoria to wind up Planet Platinum Ltd on just and equitable
grounds.
In June 2015, the Supreme Court of Victoria has ordered the
appointment of Ferrier Hodgson partner John Lindholm as
provisional liquidator to Planet Platinum Limited.
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C H I N A
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CHINA SOUTH: Moody's Revises Outlook on B1 CFR to Negative
----------------------------------------------------------
Moody's Investors Service has revised to negative from stable the
outlook on China South City Holdings Limited's (CSC) B1 corporate
family rating and B2 senior unsecured debt rating. Moody's has
also affirmed all the ratings of CSC.
RATINGS RATIONALE
"The change in ratings outlook to negative from stable reflects
our expectation that CSC's credit metrics will stay weak as its
contracted sales and revenue recognition visibility will remain
low in the next 12 to 18 months," says Stephanie Lau, a Moody's
Assistant Vice President and Analyst.
On Nov. 27, 2015, CSC reported a year-on-year decline of 58.1% in
revenue to HKD2.15 billion and 44% decline in contracted sales to
HKD3.80 billion for the first half of the financial year ending
March 2016 (1H FY March 2016).
The company's weak performance came from the slower economic
growth in China (Aa3 stable), lower infrastructure spending by the
local government, and the weaker investment sentiment of
investors.
Moody's believes that CSC will likely deliver weak contracted
sales in the next 12-18 months because the slow Chinese economy is
likely to persist.
In light of the challenging market conditions, CSC's strategy is
to conserve liquidity, which includes reducing capital expenditure
and increasing low-cost borrowing.
As such, Moody's believes that the company's debt level is
unlikely to fall and may even increase modestly. This implies
that the company's credit metrics could be weaker than the levels
reported in 1H FY March 2016.
As a result of weaker revenue recognition in 1H FY March 2016,
CSC's EBIT/interest coverage dropped to 1.9x on a last twelve
months basis compared with 3.0x at FYE03/2015. Such a low level
could pressure its ratings.
On the other hand, Moody's has noted that CSC's non-development
recurring revenue in 1H FY March 2016 recorded a 63% year-on-year
rise to HKD603 million, which provided interest coverage of around
63%.
Additionally, CSC's liquidity position has not deteriorated. Its
cash/short-term debt improved slightly to 95% at end-September
2015 after issuance of corporate bonds in 2015, compared to 91% at
end-March 2015.
CSC's B1 corporate family rating reflects its unique business
model, which involves the development and operation of integrated
logistics and trade centers in China.
The rating also considers CSC's ability to access large suburban
land plots at a low cost, as well as the infrastructure support it
receives from local governments.
Its relatively low land costs have helped the company achieve high
gross margins that offer flexibility in pricing in a down cycle.
Nevertheless, CSC's rating is constrained by execution risks
related to its expansion into new locations. Its fast and large-
scale expansion will entail significant funding needs.
Moreover, CSC is developing a stream of non-development recurring
income from its logistics and trade centers that can significantly
contribute to debt servicing.
The rating outlook could return to stable if CSC improves (1) its
contracted sales; and (2) its revenue and profitability such that
its EBIT/interest coverage level trend towards 2.0x-2.5x and non-
development recurring revenue/gross interest ratio stays at 0.7-
0.8x.
On the other hand, downgrade pressure on CSC's ratings could arise
if the company (1) experiences contracted sales deterioration from
the level recorded in 1H FY March 2016, which is unlikely to
reverse in the near term; (2) increases its level of unsold
inventory; (3) shows weakening in its liquidity position; or (4)
shows deterioration in its credit metrics, that is, EBIT/interest
falling below 2.0x-2.5x, and non-development recurring
revenue/gross interest ratio below 0.7-0.8x.
The ratios above are calculated based on Moody's standard
adjustments and the definition stated in Moody's Homebuilding And
Property Development Industry. The interest coverage formula is
modified for Chinese developers and substitutes "capitalized
interest" in the numerator for "interest charged to cost of goods
sold". This is because the latter is not separately disclosed in
audited financial statements. Total debt does not include
adjustments for mortgage guarantees.
The principal methodology used in these ratings was Homebuilding
And Property Development Industry published in April 2015.
China South City Holdings Limited, listed on the Hong Kong Stock
Exchange, is a developer and operator of large-scale integrated
logistics and trade centers in China. The company operates one
center in Shenzhen and is developing new trade centers in Nanning,
Nanchang, Xian, Harbin, Zhengzhou, Hefei and Chongqing.
FUWEI FILMS: Receives Nasdaq Listing Non-Compliance Notice
----------------------------------------------------------
Fuwei Films (Holdings) Co., Ltd., a manufacturer and distributor
of high-quality BOPET plastic films in China, on Dec. 1 disclosed
that on November 25, 2015, it received a Nasdaq Staff Deficiency
Letter indicating that the Company is not in compliance with the
minimum bid price requirement for continued listing set forth in
Listing Rule 5550(a)(2) which requires listed securities to
maintain a minimum bid price of $1.00 per share.
Fuwei Films' management is looking into various options available
to the Company in order to regain compliance and ensure its
continued listing on the Nasdaq. The Company intends to actively
monitor the bid price for its ordinary shares between now and the
end of the grace period.
According to the letter from the Nasdaq, Fuwei Films has been
given a grace period of 180 calendar days, starting November 25,
2015, to regain compliance with the minimum bid price requirement.
Fuwei Films can regain compliance if, at any time before the grace
period ends, the bid price of its ordinary shares closes at or
above $1.00 per share for a minimum of ten consecutive business
days. If Fuwei Films cannot demonstrate compliance by the end of
the grace period, the Nasdaq's staff will notify the Company that
its ordinary shares is subject to delisting. Fuwei Films may then
be eligible for an additional 180 day grace period if the Company
meets the Nasdaq Capital Market's initial listing standards with
the exception of the minimum bid price requirement.
During the grace period (as may be extended) Fuwei Films' ordinary
shares will continue to trade on the Nasdaq Capital Market under
the symbol "FFHL".
About Fuwei Films
Fuwei Films conducts its business through its wholly owned
subsidiary, Fuwei Films (Shandong) Co., Ltd. ("Shandong Fuwei").
Shandong Fuwei develops, manufactures and distributes high-quality
plastic films using the biaxial oriented stretch technique,
otherwise known as BOPET film (biaxially oriented polyethylene
terephthalate). Fuwei's BOPET film is widely used to package food,
medicine, cosmetics, tobacco, and alcohol, as well as in the
imaging, electronics, and magnetic products industries.
HYDOO INTERNATIONAL: Moody's Assigns B2 Corporate Family Rating
---------------------------------------------------------------
Moody's Investors Service has assigned a first-time B2 corporate
family rating to Hydoo International Holding Limited.
At the same time, Moody's has assigned a provisional (P)B3 senior
unsecured rating to Hydoo's proposed US dollar notes.
The ratings outlook is stable.
The company plans to use the proceeds from the proposed issuance
for land acquisitions and project development, debt repayment and
other general corporate purposes.
Moody's will remove the provisional status of the notes after they
are issued on satisfactory terms and conditions.
RATINGS RATIONALE
"Hydoo's B2 corporate family rating reflects the company's track
record of developing trade centers in low-tier Chinese cities,"
says Kaven Tsang, a Moody's Vice President and Senior Credit
Officer.
In particular, the company focuses on developing trade centers for
sale in 12, third- and fourth-tier cities in China.
Hydoo has displayed a good track record of developing such trade
centers in the cities of Ganzhou, Ningxiang, Jining, and Mianyang.
It achieved an average sell-through rate in the four cities in
excess of 90% at end-2014.
These four cities will contibute around 40% of its total
contracted sales in 2016 and 2017, and the company's track record
and brand recognition in those cities will offer some sales
visibility over the next two years.
Its good track record also enabled it to secure new projects in
other low-tier cities.
Local governments welcome Hydoo because its projects boost
employment rates, local GDP growth, tax revenues and urban
development.
The B2 corporate family rating also considers Hydoo's high profit
margins, which are primarily driven by its low land cost.
Moody's expects that the company's high profit margins will fall
because demand for commercial properties will soften, due to the
slower Chinese economy.
Moody's notes that the company has benefited from local government
support, in the form of government grants. Such grants have
enhanced its returns and cash flows, but it is uncertain as to
whether or not its future projects will receive similar support.
"Hydoo's B2 corporate family rating further factors in the
inherent business volatility associated with its focus on
developing commercial properties, its small scale, short listing
record, and the execution risk related to the company's expansion
into multiple cities," adds Tsang, who is also the Lead Analyst
for Hydoo.
Hydoo is exposed to unfavorable changes in macroeconomic
conditions, industrial outputs, investment demand and the
availability of financing.
Moody's notes that as a result of the slowing economic growth in
China, the sales growth of trade and logistic centers in the
country has slowed since 2013.
In addition, there are uncertainties as to the level of demand for
trade centers in low-tier cities, given these cities' weaker
economic fundamentals when compared to major cities. The
sustainability of Hydoo's sales growth rates is therefore
uncertain and the company could face higher execution risk and
performance volatility.
Less developed infrastructure in low-tier cities could also affect
the company's sales and cash flow. For instance, sales of the
company's project in Wuzhou was postponed, due to a delay in the
completion of a freeway connected to the project.
As mentioned, Hydoo's operating scale is small, and it has
exhibited sales concentration. For example, its three largest
projects together accounted for 65% and 85% of its contracted
sales in 2014 and 1H 2015 respectively.
This concentration risk results in some volatility in the
company's performance. For example, its contracted sales fell to
RMB2.9 billion in 2014 from RMB7.0 billion in 2013.
Another rating constraint is Hydoo's short track record of
delivering sales growth after its listing in October 2013. Its
contracted sales in the first 10 months of 2015 was slow, totaling
RMB2.3 billion or less than 50% of its annual target.
While Hydoo's current credit metrics are strong for its B2
corporate family rating, Moody's expects the company's credit
profile to change, as it continues its fast expansion.
As Hydoo increases its borrowings to fund its expansion, Moody's
expects its EBIT/interest coverage to register 3.0x-4.5x over the
next 12-18 months, and revenue/adjusted debt to range from 70%-
80%. Such results are appropriate for its B2 corporate family
rating.
Hydoo's liquidity position is strong, as reflected by its cash to
short-term debt of 206% at end-June 2015. Its liquidity levels are
important rating drivers that buffer against the company's
volatile sales.
Hydoo's bond rating is notched down to (P)B3 from its corporate
family rating of B2 due to subordination risk from the company's
secured and subsidiary debt. Moody's expects such debt to register
around 15%-30% of total assets over the medium term. The ratio
stood at around 15% at June 2015.
The stable ratings outlook reflects Moody's expectation that Hydoo
will maintain stable contracted sales growth, adequate liquidity
levels and stable credit metrics, while expanding its businesses.
Upward ratings pressure could emerge if Hydoo: (1) expands its
scale through stable growth in contracted sales, and maintains
good credit metrics as represented by EBIT/interest in excess of
4.5x and revenue/adjusted debt exceeding 80%, and (2) maintains a
solid liquidity profile such that its cash/short term debt exceeds
1.5x.
The ratings could be downgraded if Hydoo: (1) shows weaker
contracted sales, (2) undertakes aggressive debt-funded expansion
to the detriment of its credit metrics, such that its
EBIT/interest coverage falls below 1.5x-2.0x; and/or
revenue/adjusted debt registers below 65%, or (3) shows
deteriorating liquidity metrics, with cash to short-term debt
falling below 100%.
HYDOO INTERNATIONAL: S&P Assigns 'B' CCR; Outlook Stable
--------------------------------------------------------
Standard & Poor's Ratings Services said that it had assigned its
'B' long-term corporate credit rating to Chinese trade center
developer Hydoo International Holding Ltd. The outlook is stable.
S&P also assigned its 'cnBB-' Greater China regional scale rating
to the company.
At the same time, S&P assigned its 'B-' long-term issue rating and
'cnB+' Greater China regional scale rating to Hydoo's proposed
issue of U.S.-dollar-denominated senior unsecured notes. The
rating on the proposed notes is subject to S&P's review of the
final issuance documentation.
"The corporate credit rating on Hydoo reflects the company's
project concentration risk, execution risk due to its growth
aspirations, and weakening leverage," said Standard & Poor's
credit analyst Dennis Lee. "Hydoo's good profitability and
operations in the trade-center development business for more than
a decade temper these weaknesses."
S&P anticipates that Hydoo's concentration risk will remain high
over the next 12 months at least, given the company's small
operating scale and limited number of trade center projects.
Hydoo's contracted sales in 2014 were Chinese renminbi (RMB) 2.9
billion, significantly below the company's sales in 2013. S&P
expects Hydoo's total contracted sales to rebound to about
RMB4.5 billion in 2015 and RMB6.0 billion in 2016, thanks to
easier access to credit in China and the company's heavy
investment in its project pipeline. Nevertheless, sales are
likely to come from several new launches and a few existing large
projects. Changes in government regulations and market sentiment
in the locations of Hydoo's key projects, or delays in project
launches or completions could substantially affect Hydoo's sales
and revenue recognition.
Significant expansion plans in the coming years will increase
Hydoo's execution risk, in S&P's opinion. Many of the new
projects are likely to be situated in cities where the company has
limited experience. The proposed pace of expansion could also
pressure the company's resources and test its project execution as
it operates on an enlarged scale. Nevertheless, Hydoo's operating
record in this industry and experienced management could temper
such risks. S&P anticipates that Hydoo will sign up two to three
new projects each year.
S&P forecasts Hydoo's EBITDA margin to stay above 35% in 2015 and
2016, despite S&P's expectation of shrinking government grants and
gradually increasing labor and construction costs. In S&P's view,
the margin is mainly supported by Hydoo's sizable low-cost land
reserves. Local governments are usually willing to offer land
parcels to trade center developers at a low cost because trade
centers can bring in tax revenue from trade activities, create
employment opportunities, and sometimes free up space in downtown
areas where some old trade centers are located.
Hydoo is likely to maintain high capital expenditure on land
acquisitions and construction to meet its high growth aspirations
over the coming few years. Such expenditure will put pressure on
the company's leverage, in S&P's view. Hydoo's aggressive
financial risk profile reflects the company's continuous debt-
funded expansion and our expectation that Hydoo's leverage will
worsen.
The issue rating is one notch lower than the long-term corporate
credit rating on Hydoo to reflect structural subordination risk.
"The stable outlook on Hydoo reflects our expectation that the
company's sales will grow steadily in the coming 12 months," said
Mr. Lee. "We also expect Hydoo's EBITDA margin to stay at about
35%. At the same time, we forecast that Hydoo's leverage will
gradually worsen over the next two years to support rapid
expansion."
S&P may lower the rating if Hydoo's leverage deteriorates
materially beyond S&P's expectation over the next 12 months, such
that its debt-to-EBITDA ratio exceeds 5x. This could happen if
the company's project completion and delivery slip such that its
EBITDA is substantially lower than S&P's forecast, or Hydoo's pace
of expansion is much faster than S&P's expectation, resulting in a
material increase in debt.
Rating upside in the next 12 months is limited, mainly due to
Hydoo's small operating scale and our expectation that the
company's leverage will worsen. However, S&P may raise the rating
if Hydoo's sales execution remains good while the company
maintains its debt-to-EBITDA ratio consistently below 4x.
SUTOR TECHNOLOGY: Receives Nasdaq Listing Non-Compliance Notice
---------------------------------------------------------------
Sutor Technology Group Limited on Dec. 1 disclosed that it
received a letter from the Listing Qualifications Department of
The NASDAQ Stock Market, on November 24, 2015, informing the
Company that it does not comply with the Nasdaq continued listing
requirements set forth in Nasdaq Listing Rule 5250(c)(1), which
requires the timely filing of periodic reports because the Company
has not yet filed its Form 10-Q for the period ended September 30,
2015. The Nasdaq notification letter does not result in the
immediate delisting of the Company's common stock, and the stock
will continue to trade uninterrupted under its current trading
symbol.
The Company has until December 14, 2015, to submit a plan to
regain compliance with respect to the above delinquent reports.
The Nasdaq Listing Rules provide that the Staff can grant the
Company an exception of up to 180 calendar days from the filing's
due date, or March 28, 2016 to regain compliance if Nasdaq accepts
the Company's plan of compliance. The Company expects to submit
the delinquent reports or the plan of compliance before the
deadline.
About Sutor Technology Group Ltd
Sutor Technology Group Limited -- http://www.sutorcn.com-- is a
China-based manufacturer and customized service provider of
high-end fine finished steel products and welded steel pipes used
by a variety of downstream applications. The Company utilizes a
variety of in-house developed processes and technologies to
convert steel manufactured by third parties into fine finished
steel products, including hot-dip galvanized steel, pre-painted
galvanized steel, acid-pickled steel, cold-rolled steel and welded
steel pipe products. The Company also provides fee-based steel
processing services to customers, including industrial peers.
WEST CHINA: Moody's Puts Ba3 CFR Under Review for Upgrade
---------------------------------------------------------
Moody's Investors Service has placed West China Cement Limited's
(WCC) Ba3 corporate family and senior unsecured debt ratings under
review for upgrade.
On Nov. 27, 2015, Anhui Conch Cement Company Limited (A3 stable)
and WCC jointly announced that Conch would sell four of its cement
producing companies based in Shaanxi Province to WCC in exchange
for new equity shares to be issued by WCC.
If the exchange goes ahead, Conch will become WCC's largest
shareholder, with an equity stake of 51.57% from the current
21.17%.
Pursuant to the Hong Kong Takeovers Code, Conch will launch a
mandatory unconditional cash offer to WCC's shareholders.
WCC's founding shareholder, Mr. Zhang Jimin, his daughter,
Ms. Zhang Lili, another major shareholder, Mr. Ma Zhaoyang, and
WCC's chief executive officer, Dr. Ma Weiping, have agreed not to
sell their shares in WCC prior to the closing of the mandatory
offer.
The completion of the transactions is conditional upon: (1) the
approval by WCC's independent shareholders, (2) the Hong Kong
Stock Exchange's grant of a listing and permission to deal in the
subscription shares on the stock exchange, and (3) other
regulatory approvals by Mainland Chinese authorities.
RATINGS RATIONALE
"If the transactions are completed, WCC will benefit from its
majority ownership by Conch, given Conch's position as the
dominant player in China's cement industry, and Conch's strong
credit profile," says Franco Leung, a Moody's Vice President and
Senior Analyst.
Conch's substantially larger business scale and stronger financial
profile when compared with WCC enable it to provide operational
and financial support to WCC.
In 2014, Conch's revenue totaled RMB60.8 billion. The amount was
more than 15 times that of WCC's RMB3.9 billion in the same
period.
As for debt to EBITDA, Conch's 1.2x for the 12 months ended
June 30, 2015 was significantly lower than WCC's 4.3x for the
corresponding period.
Conch's prudent financial management and strong access to the
capital markets will help WCC maintain an adequate financial
profile, against the backdrop of a cyclical operating environment.
Moody's believes that Conch will provide support to WCC if needed,
based on the fact that Conch's cement assets in Shaanxi Province
will be largely held by WCC, after the injection of the four
cement companies into WCC.
It is likely that Conch will use WCC as a platform to consolidate
the cement industry in Shaanxi.
The market consolidation in Shaanxi Province will reduce the
number of competitors and lead to a more stable pricing
environment.
"WCC will increase significantly its business scale and market
position in Shaanxi Province, upon the asset injection by Conch,"
says Jiming Zou, a Moody's Vice President and Senior Analyst, and
also the Local Market Analyst for WCC.
Moody's notes that if the transactions are successful, WCC will
raise its market share in Shaanxi Province to about 40% from 26%
in 2014, after integrating Conch's four cement companies and the
recently acquired Yaowangshan Cement.
The four cement companies would add 10.4 million tons per annum of
cement capacity to WCC's operations, and increase WCC's total
cement capacity to about 40 million tons per annum (about 33.7
million tons in Shaanxi Province).
During 2014, WCC and Conch were the first- and third-largest
producers in Shaanxi Province by total production capacity.
WCC will benefit from a closer cooperation with Conch in cement
production and sales, because the company would be able to
exercise stronger bargaining power and achieve business synergies
in Shaanxi Province.
The closer linkage between WCC and Conch will also facilitate
improvements in WCC's technology, management efficiencies and
competitiveness.
Moody's points out that WCC's profitability will remain weak over
the next 12-18 months, because demand in Shaanxi Province remains
lackluster.
Moody's also notes that the operations of the companies to be
acquired demonstrate low margins, and the positive synergies with
Conch will take time to realize.
In particular, WCC's debt/EBITDA will likely remain elevated,
ranging from 4.0x-4.5x.
Moody's will review:
(1) Whether or not the transactions will be completed as
planned;
(2) WCC's fundamental credit profile after the integration of
Conch's four cement companies, as well as WCC's future
business strategy and financial policies; and
(3) The business integration and cooperation between WCC and
Conch, in particular, the likely level of support that
Conch will provide to WCC in times of need.
The principal methodology used in these ratings was Building
Materials Industry published in Sept. 2014.
West China Cement Limited is one of the leading cement producers
by capacity in Shaanxi Province. At end-June 2015, the company's
annual production of cement totaled 27 million tons. It recorded
RMB3.9 billion in revenues in 2014.
Anhui Conch Cement Co., Ltd., listed on the Hong Kong Stock
Exchange in 1997 and the Shanghai Stock Exchange in 2002. The
company is the second-largest cement producer in China by
production volume. It recorded sales of RMB60.8 billion in
FY2014.
* Chinese Auto Loan ABS Delinquencies Up in Q3 2015, Moody's Says
----------------------------------------------------------------
Moody's Investors Service says that the performance of Chinese
auto loan asset-backed securities (ABS) deteriorated in Q3 2015
from Q2 2015, and will continue to slow in quarters ahead as
China's economy continues to slow.
"The uptick in delinquency in Q3 2015 was mainly driven by higher
delinquency rates for 2015 vintage auto ABS," says Kan Leung, a
Moody's Assistant Vice President and Analyst.
"These transactions had fewer delinquent loans in Q2 2015 because
only non-delinquent loans were eligible in initial portfolios,"
adds Leung. "As the transactions continued to season in Q3 2015,
delinquencies picked up to reflect the underlying performance of
the auto loans."
Leung was speaking on the release of Moody's quarterly update on
the performance auto ABS in China, titled "Auto ABS -- China:
Delinquencies Increase in Q3 2015; Will Continue to Rise
Moderately."
Looking ahead, Moody's expects delinquencies to increase
moderately in Q4 2015 and into 2016 because of the continuing
economic slowdown in China. Moody's forecast GDP growth of 6.3%
in 2016 and 6.1% in 2017, from just under 7% in 2015.
Despite the slowdown, the overall credit quality of auto loan
borrowers will remain sound in 2016, says Moody's, because of the
tight lending criteria and conservative underwriting standards of
originators.
The recent interest rate cuts by the People's Bank of China will
also help reduce the debt burden of borrowers with floating rate
loans.
Transactions originated by banks continued to outperform those
issued by the captive finance companies of auto manufacturers.
This is because the underwriting processes of bank lenders benefit
from the banks' longer operating histories and experience in
consumer credit in China.
In addition, where the auto loan borrower is also an existing
customer of a bank, the bank would possess additional credit
information from the existing client relationship.
The report is available to subscribers here:
http://www.moodys.com/viewresearchdoc.aspx?docid=PBS_1010050
The report may also be found through this link to Moody's topic
page, China - Reform and Rebalancing, a centralized source for
Moody's research related to key credit issues in China as the
country's rebalancing story unfolds.
Recent Moody's publications relating to China Reform and
Rebalancing include:
High-Yield-Bond Covenants -- Chinese Property Developers:
Covenant Protection Against Onshore Bond Issuance is Weak
Property -- China: Decline in Offshore Funding Costs Is Credit
Positive for Developers
China Property Focus -- November 2015
China's City Gas Operators Benefit from Lower Natural Gas Price
National Oil Companies -- China: Natural Gas Price Adjustment
Will Further Reduce NOC Profits
Sub-Sovereign: Chinese Regional and Local Government Debt and
Finances Snapshot
Behind Moody's Ratings of Chinese State-Owned Enterprises (SOEs)
(Presentation)
China's Proposed Disclosure on Bank Liquidity Is Credit Positive
Chinese Non-Financial Corporates: Revenue and Leverage Pressured
by China's Slowing Economy (Presentation)
Quarterly China Shadow Banking Monitor (Presentation)
These reports are available at:
http://www.moodys.com/chinarebalancing
=========
I N D I A
=========
ADVANSYS (INDIA): CRISIL Cuts Rating on INR70MM Term Loan to D
--------------------------------------------------------------
CRISIL has downgraded its rating on the long-term bank facilities
of Advansys (India) Private Limited (AIPL) to 'CRISIL D' from
'CRISIL B/Stable'.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 30 CRISIL D (Downgraded from
'CRISIL B/Stable')
Proposed Long Term 25 CRISIL D (Downgraded from
Bank Loan Facility 'CRISIL B/Stable')
Term Loan 70 CRISIL D (Downgraded from
'CRISIL B/Stable')
The downgrade follows instances of delay by AIPL in servicing its
term debt. The delays were caused by weak liquidity because of
cash losses.
The rating also reflects AIPL's exposure to risks related to
completion of its ongoing capital expenditure and to the
subsequent stabilisation of operations. The rating also factors in
constrained financial risk profile because of modest net worth and
weak debt protection metrics. These weaknesses are mitigated by
the promoter's extensive experience in the healthcare and fitness
products industry.
AIPL, promoted by Mr. Pankaj Balwani, is setting up a plant in
Pune for manufacturing healthcare and fitness products. The
promoter has experience of around a decade in manufacturing and
trading of wellness and healthcare products.
AERO TREATMENTS: CRISIL Assigns 'B' Rating to INR67MM LT Loan
-------------------------------------------------------------
CRISIL has assigned its 'CRISIL B/Stable' rating to the long-term
bank facilities of Aero Treatments Pvt Ltd (ATPL). The rating
reflects the company's nascent stage of operations and customer
concentration in its revenue profile. These rating weaknesses are
partially offset by the extensive industry experience of the
company's promoters and its sound technical capabilities.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Long Term Loan 67 CRISIL B/Stable
Proposed Long Term
Bank Loan Facility 3 CRISIL B/Stable
Outlook: Stable
CRISIL believes ATPL will continue to benefit over the medium term
from its promoters' extensive industry experience. The outlook may
be revised to 'Positive' in case of more-than-expected revenue and
profits after operations stabilise, while working capital
requirement is effectively managed, leading to a better business
risk profile. Conversely, the outlook may be revised to 'Negative'
if the company's financial risk profile deteriorates, most likely
because of lower-than-expected ramp up in scale of operations and
operating profitability.
Incorporated in 2014, ATPL has set up a surface treatment unit at
Tumkur, Karnataka. Its operations will be managed by the director
Mr. Srikanth G S.
AMR GLOBAL: CRISIL Suspends 'D' Rating on INR100MM Bank Loan
------------------------------------------------------------
CRISIL has suspended its ratings on the bank facilities of
AMR Global Industries Limited (AMR Global).
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Bank Guarantee 100 CRISIL D
Cash Credit 90 CRISIL D
The suspension of ratings is on account of non-cooperation by AMR
Global with CRISIL's efforts to undertake a review of the ratings
outstanding. Despite repeated requests by CRISIL, AMR Global is
yet to provide adequate information to enable CRISIL to assess AMR
Global's ability to service its debt. The suspension reflects
CRISIL's inability to maintain a valid rating in the absence of
adequate information. CRISIL considers information availability
risk as a key factor in its rating process as outlined in its
criteria 'Information Availability - a key risk factor in credit
ratings'.
AMR Global is part of the AMR group based in Hyderabad, which has
interests in mining, infrastructure, sugar, hospitality, and
agriculture. AMR was set up in 2005 by Mr. Mahesh Reddy and Mr.
Girish Reddy. The company primarily trades in dress materials,
iron ore, and steel products. The company is based in Hyderabad
(Andhra Pradesh).
AVEDA VENTURES: Ind-Ra Assigns 'IND BB-' Long-Term Issuer Rating
----------------------------------------------------------------
India Ratings and Research (Ind-Ra) has assigned Aveda Ventures
Pvt Ltd (Aveda) a Long-Term Issuer Rating of 'IND BB-' with a
Stable Outlook. The agency has also assigned Aveda's proposed
INR500m term loan a 'Provisional IND BB-' rating with a Stable
Outlook.
KEY RATING DRIVERS
The ratings reflect the financial and execution risks associated
with the nascent stage of Aveda's sole commercial complex project
Aveda Meta. Out of the 12 floors planned, two basements have been
completed so far. The ratings also consider the pendency of
financial closure, which is likely to be achieved by end-November
2015 and the revenue concentration risks associated with a single
project business.
The ratings benefit from the favourable location of the project in
proximity of a metro station in Indiranagar, Bangaluru and from
the over 10 years of experience of the company's promoters in the
real estate business.
RATING SENSITIVITIES
Positive: Completion and leasing out of the complex as planned,
leading to strong visibility of cash flows in the medium term may
be positive for the ratings.
Negative: Any delay in the funding or completion of the commercial
complex leading to delays in occupancy or time and cost overruns
may be negative for the ratings.
COMPANY PROFILE
Incorporated in 2014, Aveda is engaged in residential and
commercial real estate development.
Aveda is developing a commercial complex which is planned to be
leased. The building is on the 80 feet Old Madras Road Opposite to
Vivekananda Metro Station. The estimated project cost of INR750m
is to be funded by bank debt of INR500m and promoter's
contribution of INR250m. The land has been provided by The
Institute of the Brothers of Saint Gabriel. The project commenced
in September 2014 and is likely to be completed by December 2016.
The second basement is under construction.
SOLICITATION DISCLOSURES
Additional information is available at www.indiaratings.co.in. The
ratings above were solicited by, or on behalf of, the issuer, and
therefore, India Ratings has been compensated for the provision of
the ratings.
Ratings are not a recommendation or suggestion, directly or
indirectly, to you or any other person, to buy, sell, make or hold
any investment, loan or security or to undertake any investment
strategy with respect to any investment, loan or security or any
issuer.
BLUEZONE VITRIFIED: CRISIL Assigns 'B' Rating to INR317MM Loan
--------------------------------------------------------------
CRISIL has assigned its 'CRISIL B/Stable/CRISIL A4' ratings to the
bank facilities of Bluezone Vitrified Pvt Ltd (BVPL).
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Term Loan 317 CRISIL B/Stable
Bank Guarantee 43 CRISIL A4
Cash Credit 80 CRISIL B/Stable
The ratings reflect BVPL's exposure to project-related risks and
modest scale of operations in highly competitive ceramic tiles
industry. These rating weaknesses are partially offset by the
extensive experience of promoters in the ceramic industry and
strategic location of its plant at Morbi (Gujarat) which ensures
availability of raw materials and labour.
Outlook: Stable
CRISIL believes BVPL will maintain the business risk profile
backed by the promoters' extensive industry experience. However,
the financial risk profile is expected to remain average over the
medium term owing to high gearing and weak debt protection metrics
given the likelihood of low accrual during the project
stabilisation phase. The outlook may be revised to 'Positive' if
operations stabilise earlier than expected, leading to improvement
in the financial risk profile. Conversely, the outlook may be
revised to 'Negative', if operating margin is lower than expected
or the company undertakes more-than-anticipated, debt-funded
capital expenditure or working capital management deteriorates,
leading to deterioration in the financial risk profile.
BVPL, based in Morbi, was incorporated in May 2014. The company is
setting up a vitrified tile manufacturing facility, with a total
production capacity of 76,500 tonnes per annum.
HARIWANSH PACKAGING: CRISIL Reaffirms B+ Rating on INR72.5MM Loan
-----------------------------------------------------------------
CRISIL's rating on the long-term bank facilities of Hariwansh
Packaging Pvt Ltd (HPPL) continues to reflect HPPL's average
financial risk profile marked by high gearing and average debt
protection metrics, and its modest scale of operations in the
intensely competitive packaging industry. These rating weaknesses
are partially offset by the extensive industry experience of
HPPL's promoters and its established relationships with customers.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 52.5 CRISIL B+/Stable (Reaffirmed)
Term Loan 72.5 CRISIL B+/Stable (Reaffirmed)
Outlook: Stable
CRISIL believes that HPPL will continue to benefit over the medium
term from its promoters' extensive industry experience. The
outlook may be revised to 'Positive' if the company generates
substantial cash accruals or if its promoters infuse significant
equity, leading to improvement in its financial risk profile.
Conversely, the outlook may be revised to 'Negative' in case of a
significant decline in HPPL's cash accruals, or deterioration in
its working capital cycle, or any large debt-funded capital
expenditure (capex), weakening its financial risk profile.
Update
HPPL's business performance in terms of revenue, margins, net cash
accruals, and working capital cycle has been in line with CRISIL's
estimation for 2014-15 (refers to financial year,
April 1 to March 31). The operations at the new plant has now been
stabilised; the plant is currently producing 700 to 800 tonnes per
month and is operating at 50 per cent capacity utilisation. CRISIL
expects HPPL to register a revenue growth of 10 to 15 per cent,
while maintaining a healthy operating margin of 12 to 16 per cent,
per annum over the medium term, backed by incremental demand from
existing customers coupled with increased utilisation of the
recently enhanced capacities.
HPPL has working-capital-intensive operations, reflected in its
gross current assets (GCAs) of 228 days as on March 31, 2015, due
to high inventory holding period. The company maintains an
inventory of about 120 days, constituting 60 days for raw
materials and another 30 to 45 days for finished goods. CRISIL
expects the company's operations to remain working capital
intensive, with GCAs of 200 to 225 days, due to high inventory
holding period, over the medium term.
HPPL's liquidity remained stretched, with high bank line
utilisation of above 90 per cent in 2014-15; however, the company
is expected to generate sufficient accruals to meet annual
repayments of Rs.15.6 million over the medium term.
HPPL's financial risk profile improved in 2014-15 but remained
weak, with gearing of 6.7 times as on March 31, 2015 (8.6 times a
year earlier). Further, with high interest outgo, debt protection
metrics remained average with interest coverage at 1.7 times for
2014-15. In the absence of any capex plan, the financial risk
profile is expected to improve over the medium term. However, high
levels of external borrowings will continue to constrain the
company's financial risk profile.
For 2014-15, HPPL reported a net profit of Rs.4.1 million on net
sales of Rs.311.3 million, against a net profit of Rs.2.1 million
on net sales of Rs.182.4 million for 2013-14.
HPPL manufactures corrugated boxes used in industries such as
fast-moving consumer goods, explosives, and textiles. It is
promoted by Mr. Vijay Murarka, who has experience of about 30
years in the business. The company's facilities are in Nagpur
(Maharashtra).
HITECH LITHO: CRISIL Cuts Rating on INR30MM Cash Loan to 'B'
------------------------------------------------------------
CRISIL has downgraded its rating on the long-term bank facilities
of Hitech Litho Private Limited (HLPL) to 'CRISIL B/Stable' from
'CRISIL B+/Stable', and reaffirmed its rating on the short term
bank facility at 'CRISIL A4'.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 30 CRISIL B/Stable (Downgraded
from 'CRISIL B+/Stable')
Letter of Credit 10 CRISIL A4 (Reaffirmed)
Proposed Long Term 13.5 CRISIL B/Stable (Downgraded
Bank Loan Facility from 'CRISIL B+/Stable')
Term Loan 8.4 CRISIL B/Stable (Downgraded
from 'CRISIL B+/Stable')
The rating downgrade reflects CRISIL's belief that HLPL's
liquidity will remain weak over the medium term because of large
working capital requirement. The company's gross current assets
were high at 330 days as on March 31, 2015, primarily on account
of high receivable days, driven by delayed payment by clients in
the domestic market coupled with a long overdue balance of more
than Rs.20 million from one customer. Writing off this amount
would remain a key rating sensitivity factor. Large working
capital requirement resulted in an almost fully utilised bank
limit at an average of around 92 percent over the 12 months
through March 2015. Though the company is scaling up its export
revenue, wherein realisation is faster, CRISIL expects the debtor
days to remain high over the medium term. However, liquidity is
supported by low repayment obligation and funding support from
promoters through unsecured loans.
The ratings reflect HLPL's average financial risk profile,
especially liquidity, because of a stretched working capital
cycle, and its vulnerability to intense competition in the
printing ink industry. These rating weaknesses are partially
offset by the extensive industry experience of its promoters.
Outlook: Stable
CRISIL believes HLPL will continue to benefit over the medium term
from its promoters' extensive industry experience. The outlook may
be revised to 'Positive' in case of substantial accrual, leading
to improvement in the financial risk profile, especially
liquidity. Conversely, the outlook may be revised to 'Negative' if
the financial risk profile, especially liquidity, deteriorates,
most likely because of low accrual, a stretched working capital
cycle, or large debt-funded capital expenditure.
HLPL was incorporated in February 2011, promoted by Mr. Gyanrakash
Srivastava and Mrs. Nitu Srivastava. It manufactures various
printing inks that are used in the packaging industry.
The company's profit after tax was Rs.1.4 million on net sales of
Rs.80.5 million for 2014-15 (refers to financial year, April 1 to
March 31), against Rs.1.5 million on net sales of Rs.71.4 million
for 2013-14.
JAY KHODIYAR: CRISIL Assigns 'B' Rating to INR80MM Cash Loan
------------------------------------------------------------
CRISIL has assigned its 'CRISIL B/Stable' rating to the long-term
bank facilities of Jay Khodiyar Cotton Industries (JKCI). The
rating reflects the promoter's extensive experience in the cotton
industry and proximity of the manufacturing facilities to raw
material. These rating strengths are partially offset by the
modest scale of operations in a highly competitive industry and
working capital-intensive operations.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 80 CRISIL B/Stable
Long Term Loan 10 CRISIL B/Stable
Outlook: Stable
CRISIL believes JKCI will continue to benefit over the medium term
from its promoter's experience in the cotton industry. The outlook
may be revised to 'Positive' in case of scale up of operations and
higher-than-expected accruals, or if the capital structure
improves because of capital infusion. Conversely, the outlook may
be revised to 'Negative' if the financial risk profile weakens,
because of increased working capital borrowings or large debt-
funded capital expenditure, or the operations are negatively
impacted by any change in government policies.
Established in 2012, in Kadi (Gujarat), JKCI is a cotton ginning
unit with a capacity of producing 50 tonne i.e. 350 bales per day.
The company processes raw cotton (kappas) into cotton bales and
caters to domestic markets. The operations are managed by Mr.
Druv, who has been involved in cotton industry for more than a
decade.
KALOKHE STONE: CRISIL Ups Rating on INR72MM Term Loan to 'C'
------------------------------------------------------------
CRISIL has upgraded its rating on the long-term bank facilities of
Kalokhe Stone Crusher (KSC) to 'CRISIL C' from 'CRISIL D'.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 24 CRISIL C (Upgraded from
'CRISIL D')
Term Loan 72 CRISIL C (Upgraded from
'CRISIL D')
The rating upgrade reflects timely servicing of debt over the
three months through October 2015. Liquidity, however, remains
weak on account of depressed cash accrual, which is expected to be
barely sufficient to meet term debt obligations over the medium
term.
The rating also reflects KSC's weak financial risk profile on
account of a stretched working capital cycle, and its modest scale
of operations. These rating weaknesses are partially offset by the
extensive experience of its promoters in the stone-crushing
industry.
KSC, established in 2010, commenced operations in July 2012. It
undertakes stone-crushing sub-contracting activities for companies
that implement civil construction projects, mainly road and real
estate projects. The firm is owned by the Kalokhe family; its
operations are mainly handled by Mr. Sachin Kalokhe and Mr.
Sandeep Kalokhe.
KUN AUTOMOBILES: CRISIL Suspends B+ Rating on INR160MM Loan
-----------------------------------------------------------
CRISIL has suspended its rating on the bank facility of
Kun Automobiles Private Limited (Kun).
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Inventory Funding
Facility 160 CRISIL B+/Stable
The suspension of rating is on account of non-cooperation by Kun
with CRISIL's efforts to undertake a review of the ratings
outstanding. Despite repeated requests by CRISIL, Kun is yet to
provide adequate information to enable CRISIL to assess Kun's
ability to service its debt. The suspension reflects CRISIL's
inability to maintain a valid rating in the absence of adequate
information. CRISIL considers information availability risk as a
key factor in its rating process as outlined in its criteria
'Information Availability - a key risk factor in credit ratings'
Kun was set up in 2002 by Mr. Vamshidhar Reddy and Mr. U
Venkatesh. The company is an authorised dealer of GM India's cars
in Hyderabad, Warangal, and Karimnagar (all in Andhra Pradesh).
LEELA GOLD: CRISIL Assigns B- Rating to INR75MM Cash Loan
---------------------------------------------------------
CRISIL has revoked the suspension of its rating on the bank
facilities of Leela Gold Designs Ltd. and has assigned its 'CRISIL
B-/Stable' rating to LGDL's long term bank facilities.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 75 CRISIL B-/Stable (Assigned;
Suspension revoked)
The rating was 'Suspended' by CRISIL vide the Rating Rationale
dated February 7, 2013 since LGDL had not provided necessary
information required to take the rating review. LGDL has now
shared the requisite information enabling CRISIL to assign a
rating on its bank facilities.
The rating reflects LGDL's weak financial risk profile constrained
by its small net worth and weak interest coverage. The ratings
also factors in its small scale of operations, limited value
addition in business and high customer concentration in the
revenue profile. These weaknesses are mitigated by the promoter's
extensive experience in the gold jewellery business.
Outlook: Stable
CRISIL believes LGDL will maintain a stable credit risk profile
over the medium term, backed by benefits derived from the
promoter's experience. The outlook may be revised to 'Positive' if
the financial risk profile improves, supported by significant
growth in scale with stable operating profitability. Conversely,
it may be revised to 'Negative' in case of speculative calls on
gold prices, or if profitability or if the capital structure
weakens.
Incorporated in 2003 by Mr. Parasmal Sancheti, LGDL manufactures
and sells gold chains, and trades in gold bullion. LGDL also
undertakes job works in manufacturing for third parties. The
company has its manufacturing facility in Kolkata.
MAHARANA PRATAP: CRISIL Assigns B- Rating to INR388MM Term Loan
---------------------------------------------------------------
CRISIL has assigned its 'CRISIL B-/Stable' rating to the long-term
bank facilities of Maharana Pratap Education Centre (MPEC).
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Term Loan 388 CRISIL B-/Stable
Proposed Term Loan 262 CRISIL B-/Stable
Overdraft Facility 140 CRISIL B-/Stable
Proposed Bank
Guarantee 10 CRISIL B-/Stable
The rating reflects MPEC's exposure to risks associated with
ongoing capital expenditure and subsequent timely stabilisation of
operations, and stretched liquidity profile on account of high
debtors. These weaknesses are partially offset by diversity of
courses, and promoter's extensive industry experience and their
funding support.
Outlook: Stable
CRISIL believes MPEC will benefit from its promoter's extensive
industry experience over the medium term. The outlook may be
revised to 'Positive' in case of timely completion of its project
within the budgeted cost, and subsequent significant ramp-up in
revenue, leading to higher cash accrual. Conversely, the outlook
may be revised to 'Negative' in case of time or cost overrun in
the project, or delay in stabilisation of operations.
MPEC was established in 1995 by Mr. Ram Singh Bhadauria. It
operates institutes providing technical, management, and medical
courses in Kanpur and Lucknow (Uttar Pradesh). It also operates
three schools named MPEC School, eight higher-education colleges,
and Pratap University in Jaipur.
Currently, MPEC is setting up a Medical college & Multi-specialty
hospital project in Jaipur (Rajashtan), in which 300 bedded
hospital will start from mid of 2016 with a total project cost of
Rs.2551.9 million.
MAIHAR ALLOYS: CARE Revises Rating on INR9cr LT Loan to B+
----------------------------------------------------------
CARE revises the long-term rating assigned to the bank facilities
of Maihar Alloys Pvt. Ltd.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank Facility 9 CARE B+ Revised from
CARE B
Rating Rationale
The revision in the rating of Maihar Alloys Pvt. Ltd. (MAPL) takes
into cognizance improved profitability margins and cash accruals,
improved interest coverage and moderate gearing ratios. However,
the ratings continue to be constrained by its small scale of
operation in the highly fragmented and competitive iron & steel
industry, lack of backward integration vis-a-vis volatility in
prices, high working capital intensity of operations, low capacity
utilisation and cyclicality in the steel industry.
The rating, however, continues to draw comfort from longstanding
experience of the promoters in the iron & steel industry and
strategic location of the plant.
Going forward, MAPL's ability to grow its scale of operations with
simultaneous improvement in profitability margins and effective
working capital management would be the key rating consideration.
Maihar Alloys Pvt. Ltd. (MAPL), incorporated in May 2004, by two
brothers, Mr Dhananjay Kumar and Mr Pawanjay Kumar, is engaged in
manufacturing of Mild steel (MS) ingots. The manufacturing
facility of the company is located at Rauta in Ramgarh, Jharkhand.
The unit commenced commercial production in April, 2005 with
installed capacity of 32,000 MTPA. The facility has quality system
certification of ISO: 9001:2008.
In FY15 (refer to the period April 01 to March 31), the company
has reported a total operating income of INR69.20 crore (Rs.70.29
crore in FY14) and PAT INR0.14 crore (net loss of INR0.01 crore in
FY14).Till M7FY16, the management has maintained to have achieved
a turnover of INR46.40 crore.
MALWA FRESH: CRISIL Assigns B- Rating to INR127.7MM Term Loan
-------------------------------------------------------------
CRISIL has assigned its 'CRISIL B-/Stable' rating to the long-term
bank facility of Malwa Fresh Foods (MFF).
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Term Loan 127.7 CRISIL B-/Stable
The rating reflects the firm's exposure to risks related to
implementation of, and demand for, its ongoing cold storage and
frozen food processing project. The rating also factors in the
expected modest scale of operations and average financial risk
profile because of early stage of operations. These rating
weaknesses are partially offset by the extensive entrepreneurial
experience of promoters and their committed funding support.
Outlook: Stable
CRISIL believes MFF will maintain the credit risk profile over the
medium term given the promoters' extensive entrepreneurial
experience. The outlook may be revised to 'Positive' in case of
successful completion of the project, coupled with strong revenue
and profitability generation. Conversely, the outlook may be
revised to 'Negative' in case of delays in project completion, or
lower-than-expected revenue or profitability, resulting in further
weakening of the financial risk profile and debt protection
metrics.
Set up in December 2013, MFF is a partnership between Mr. Rahul
Garg, Mr. Amit Garg, Mr. Sukhwinder Singh, Mr. Ajay Gupta, and Mr.
Inderjit Singh. It is setting up a controlled atmosphere cold
storage, with a total capacity of around 5040 tonnes per annum
(with 24 chambers) at Rampura Phul, (Punjab). MFF will provide
cold storage facility for potatoes and apples, along with other
products for institutional customers.
MGR AGRO: CARE Upgrades Rating on INR10.64cr LT Loan to BB-
-----------------------------------------------------------
CARE revises the LT rating assigned to the bank facilities of
MGR Agro Products Pvt Ltd.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank Facilities 10.64 CARE BB- Revised from
CARE B+
Rating Rationale
The revision in the rating assigned to the bank facilities of MGR
Agro Products Pvt Ltd (MAPPL) is on account of improvement in the
financial risk profile of the company during FY15 (refers to the
period April 1 to March 31) with increase in operating profit
margin, cash accruals, improved leverage ratios and satisfactory
revenue in H1FY16. However, the ratings continue to remain
constrained by its small scale of operations, highly fragmented &
competitive industry, volatility in profit margins subject to
government regulations and raw material price fluctuations and
working capital intensive nature of operations. The rating,
however, derives strength from its experienced promoters,
proximity to paddy-growing areas and rice being a major staple
food grain, consumer demand prospects for the industry is expected
to remain stable.
Going forward, the ability of the company to improve its scale of
operations & profitability in the midst of competition and
effective management of working capital will be the key rating
sensitivities.
Jharkhand-based MGR was incorporated in 2009 by Mr Anil Kumar
Goyal and Mr Pawan Kumar Gupta. Since inception, the company is
engaged in the processing & milling of rice. The company commenced
commercial production in January 2011. The unit is located at
Singhbhum, Jharkhand, and has processing capacity of 8 tonnes per
hour (TPH). The product of the company is sold under the brand
name of 'MGR' and it caters to the domestic clients.
MGR is a closely-held company, with the board comprising two
members, all representing the promoters. The day-to-day
affairs of the company are looked after by Mr Anil Kumar Goyal
(Director) and Mr Pawan Kumar Gupta with adequate support from a
team of experienced personnel.
During FY15, the company reported a total operating income of
INR21.59 crore (FY14: INR25.92 crore) and a PAT of INR0.32 crore
(in FY14: INR0.42 crore). The gross cash accrual was INR1.21 crore
(in FY14: INR0.98 crore). Furthermore, the company has achieved a
total operating income of INR19.74 crore during 6MFY16 (refers to
the period April 1 to September 30).
MONNET ISPAT: Lenders to Take Control of Steel Company
------------------------------------------------------
Business Standard reports that lenders to Blackstone-backed Monnet
Ispat and Energy Ltd plan to convert their unsecured loans into
equity shares, according to a BSE filing. The move would give the
lenders a 51 per cent stake in the Delhi-based steel company, the
report says.
Business Standard relates that Monnet said the lenders will
convert outstanding debt of INR367.79 crore for a majority stake.
After the conversion, the promoters' stake in the company would
shrink to 24.06 per cent from 48.59 per cent. The company has
scheduled an extraordinary general meeting on December 21 to get
approval on the allotment of equity, the report says.
"The outstanding amount to the extent of nearly INR368 crore
payable to such lenders by the company is converted into equity
shares of the company resulting in the lenders holding to be
51 per cent of the total share capital of the company," Business
Standard quotes Monnet as saying in the filing.
According to the report, the company wasn't able to service its
maturing liabilities, the filing added. Monnet had total
consolidated debt of about INR12,500 crore at the end of March,
raised mostly for expansion plans, the report discloses.
Business Standard says the lenders can now sell their holdings to
a new promoter. They will have up to 18 months to find a buyer for
this stake. However, the existing management will continue to run
the operations, the report states.
Lenders to a company can convert their loans into a majority stake
shares under the Reserve Bank's strategic debt restructuring
guidelines (SDR) announced in June.
Business Standard, citing a VCCirle report, recalls that in July
this year, private equity firm CX Partners made its maiden full
exit from its portfolio by selling its entire stake in Monnet at a
loss. The report notes that Blackstone remains a shareholder with
a 6.9 per cent stake in Monnet Ispat and is sitting on huge loss
of value on its original investment. It is also separately an
investor in the company's power unit.
Monnet Ispat & Energy Ltd., the flagship company of the Monnet
group, was promoted by Mr Sandeep Jajodia in 1990. The company
commenced operations in 1994 with a sponge iron plant based on the
technology provided by Jindal Steel and Power Ltd. It is currently
involved in manufacturing of sponge iron, mild steel, structural
steel, ferro alloys and power generation with an
annual installed capacity of 800,000 metric tonnes (MT), 500,000
MT, 58,400 MT and 230 MW, respectively at the Raipur facility.
As reported in the Troubled Company Reporter-Asia Pacific on
July 14, 2015, CARE revised the ratings assigned to the bank
facilities/instruments of Monnet Ispat & Energy Ltd. to:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank Facilities 5,860.06 CARE D Revised from
CARE B+
Short-term Bank Facilities 450.00 CARE D Revised from
CARE A4
Non-Convertible Debentures-I 300.00 CARE D Revised from
CARE B+
Non-Convertible Debentures-II 500.00 CARE D Revised from
CARE B+
Non-Convertible Debentures-III 250.00 CARE D Revised from
CARE B+
The revision in the ratings takes into account the delays in debt
servicing by the company.
P&M AND HI TECH: CRISIL Cuts Rating on INR400MM Loan to 'D'
-----------------------------------------------------------
CRISIL has downgraded its rating on the bank facility of P&M and
Hi Tech Infrastructures LLP (P&M) to 'CRISIL D' from 'CRISIL B-
/Stable'. The rating downgrade reflects ongoing delays by P&M in
servicing its term debt.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 400 CRISIL D (Downgraded from
'CRISIL B-/Stable')
The rating reflects the company's susceptibility to risks related
to project's exposure to risks related to implementation, and
risks related to offtake for the sale and leasing of space in the
mall impacting profitability and timeliness debt and interest
obligations.
PMHT-LLP was established in 2010 to carry out the development and
management of a multiplex-cum-mall in Jamshedpur. The planned mall
is aimed to be a single-point, multi-utility destination,
featuring retail stores, branded outlets, a food court, an
entertainment centre, a hotel, and office space, along with a
multiplex.
PMHT-LLP is a partnership between P&M Infrastructures Ltd, which
developed the P&M Mall in Patna (Bihar), and Benko Traders Pvt
Ltd, which represents the Jamshedpur-based Hi-Tech group.
POLYGENTA TECHNOLOGIES: CARE Reaffirms C Rating on INR9.20cr Loan
-----------------------------------------------------------------
CARE reaffirms ratings assigned to bank facilities and withdraws
the ratings assigned to the term loan and NCD's of Polygenta
Technologies Limited.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Bank Facilities-Fund
Based LT-Cash Credit 9.20 CARE C Reaffirmed
Bank Facilities-Fund
Based LT-Term Loan (4.50) Withdrawn
Non-Convertible
Debentures (NCDs) (10.00) Withdrawn
Rating Rationale
The ratings assigned to the bank facilities of Polygenta
Technologies Limited (PTL) continues to remain constraint on
account of delays in repayment obligations of External Commercial
Borrowings (ECB's) from Swedfund and Finfund, continuing
operational losses, negative cash accruals and deterioration in
the debt coverage indicators. Further the ratings continue to
factor in relatively new technology with operations at suboptimal
level.
The ratings continue to derive strength from the experience of
promoters and financial support from the holding company.
The ability of PTL to turnaround the business operations,
regularize the payments to ECB lenders and successfully execute
and complete its ongoing project remains the key rating
sensitivities.
Incorporated in 1981, PTL is engaged in the manufacture of
Polyester Filament Yarn (PFY) by recycling post consumer PET
bottles (major feedstock) by using patented ReNEW technology. In
2008, the Aloe Private Equity, through Aloe Environment Fund II
(AEFII) and Green Investment Asia Sustainability Fund I (GIASF)
made an equity investment in PTL's holding company, PerPETual
Global Technologies, Mauritius (PGTL). Aloe and GIASF are
sustainable funds having a primary vision of investing in
environment friendly technologies. The investors of both these
organisations are reputed environment development funds.
PTL uses a recycling technology (the ReNEW process) which is
effective in reconstituting lower cost recycled PET bottles
into a substitute feedstock for higher cost conventional
petrochemicals. Further, ReNEW offers advantages over other
recycled technology and can be retrofitted to existing
conventional polyester plants to improve their operating margins
and make them more sustainable.
The integrated manufacturing facility (PTA/MEG to DTY) of PTL is
located in Nasik, has an installed capacity of 30 TPD [10,950
Metric Tonne Per Annum (MTPA)] at its recycling unit and 60 TPD
(25,550 MTPA) at its polymerization unit.
PRIDE EAST: CRISIL Assigns B+ Rating to INR50MM LT Loan
-------------------------------------------------------
CRISIL has assigned its 'CRISIL B+/Stable' rating to the bank loan
facilities of Pride East Entertainments Pvt Ltd (PEEPL).
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Working Capital
Term Loan 5 CRISIL B+/Stable
Proposed Long Term
Bank Loan Facility 50 CRISIL B+/Stable
Term Loan 45 CRISIL B+/Stable
The rating reflects PEEPL's geographical concentration in revenue
and large working capital requirement. These rating weakness are
partially offset by the company's above-average financial risk
profile and established market position in the Assamese television
channel space.
Outlook: Stable
CRISIL believes PEEPL will continue to benefit from its
established market position over the medium term. The outlook may
be revised to 'Positive' if revenue and operating margin improve
significantly, backed by increase in advertisement rates and
diversification in revenue profile, leading to a stronger
financial risk profile. Conversely, the outlook may be revised to
'Negative' if decline in cash accrual (most likely because of weak
market conditions), intense competition, deterioration in
receivables position, or any large, debt-funded capital
expenditure weakens the key credit metrics.
Incorporated in 2006 in Guwahati (Assam), PEEPL broadcasts three
free-to-air Assamese channels: Rang TV, News Live, and Ramdhenu.
RADHIKA INFRA: CRISIL Assigns 'D' Rating to INR135.4MM LT Loan
--------------------------------------------------------------
CRISIL has assigned its 'CRISIL D' rating on the long-term bank
facility of Radhika Infra Estate Pvt Ltd (RIPL). The rating
reflects delays in debt repayments on account of weak liquidity.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Long Term Loan 135.4 CRISIL D
The company is exposed to demand and implementation related risks
associated with its ongoing real estate project at Bhopal (Madhya
Pradesh). However, it benefits from its promoters' extensive
industry experience, and its established position in Bhopal's real
estate market.
RIPL was incorporated in 2009 by Mr. Manoj Kumar Jain, Mr. Arvind
Agarwal, and Mr. Prashant Kumar Saxena. It is currently
undertaking a real estate project, Maple Tree, at the airport
bypass road, near RGPV University, Bhopal.
RAM KUMAR: CRISIL Assigns B+ Rating to INR30MM Overdraft Loan
-------------------------------------------------------------
CRISIL has assigned its 'CRISIL B+/Stable/CRISIL A4' ratings to
the bank facilities of Ram Kumar Narwani (RKN).
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Bank Guarantee 50 CRISIL A4
Overdraft Facility 30 CRISIL B+/Stable
The ratings reflect the firm's established track record in road
construction and the extensive experience of the partners in the
civil construction industry. These strengths are partially offset
by large working capital requirements, tender-based nature of
business, and moderate financial risk profile because of small net
worth and low order book.
Outlook: Stable
CRISIL believes RKN will continue to benefit over the medium term
from the partners' extensive industry experience. The outlook may
be revised to 'Positive' in case of significant increase in the
scale of operations and a steady financial risk profile.
Conversely, the outlook may be revised to 'Negative' in case of a
decline in revenue and profitability, or large, debt-funded
capital expenditure leading to weakening of the financial risk
profile, or stretch in the working capital cycle resulting in weak
liquidity.
Set up in 2001, RKN is a partnership firm that constructs roads
and minor bridges for various government departments in Madhya
Pradesh. The firm is owned and managed by Mr. Ram Kumar Narwani
and family.
SAPTHAVARNA BUILDERS: CRISIL Assigns B+ Rating to INR44MM LT Loan
-----------------------------------------------------------------
CRISIL has assigned 'CRISIL B+/Stable' rating to long-term bank
loan facilities of Sapthavarna Builders Pvt Ltd (SBPL).
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Proposed Long Term
Bank Loan Facility 6 CRISIL B+/Stable
Overdraft Facility 20 CRISIL B+/Stable
Drop Line Overdraft
Facility 30 CRISIL B+/Stable
Long Term Loan 44 CRISIL B+/Stable
The ratings reflect SBPL's modest scale of operations,
susceptibility to risks related to completion and saleability of
ongoing projects, and exposure to cyclicality in the real estate
industry. These weaknesses are partially offset by the promoters'
extensive experience in real estate development, and moderate
funding risk on all its current projects.
Outlook: Stable
CRISIL believes SBPL will benefit over the medium term from its
promoters' extensive experience in residential real estate
development. The outlook may be revised to 'Positive' if the
company completes its projects earlier than expected or in case of
more-than-expected sales realisations from ongoing projects,
leading to substantial cash flow. Conversely, the outlook may be
revised to 'Negative' if there are delays in project completion or
in the receipt of advances from customers or if SBPL undertakes a
large, debt-funded project.
SBPL, incorporated in 2008, undertakes residential real estate
development. The company is located in Thrissur (Kerala).
SENATOR MOTORS: CRISIL Cuts Rating on INR220MM Cash Loan to D
-------------------------------------------------------------
CRISIL has downgraded its ratings on the bank facilities of
Senator Motors Private Limited (SMPL) to 'CRISIL D/CRISIL D' from
'CRISIL B/Stable/CRISIL A4'.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Bank Guarantee 12.5 CRISIL D (Downgraded from
'CRISIL A4')
Cash Credit 220.0 CRISIL D (Downgraded from
'CRISIL B/Stable')
Term Loan 92.4 CRISIL D (Downgraded from
'CRISIL B/Stable')
The downgrade reflects instances of overdrawn cash credit facility
for more than 30 consecutive days because of weak liquidity driven
by low cash accrual and large working capital requirement.
SMPL also has a weak financial risk profile because of small
networth, high gearing, and weak debt protection metrics, and is
exposed to intense competition in the automotive dealership
industry. However, it benefits from its promoter's extensive
industry experience.
SMPL, based in Mumbai and incorporated in October 2011, is
promoted by Mr. Puneet Lalit Kumar. The company started operations
in November 2011 as an authorised dealer of Skoda's entire range
of cars, spare parts, and accessories at Goregaon in Mumbai.
SIDHI VINAYAK: CARE Lowers Rating on INR18cr ST Loan to 'D'
-----------------------------------------------------------
CARE revises ratings assigned to bank facilities of Sidhi Vinayak
Ricemills.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank Facilities 4.14 CARE D Revised from
CARE B
Short-term Bank Facilities 18.00 CARE D Revised from
CARE A4
Rating Rationale
The revision in the rating assigned to the bank facilities of
Sidhi Vinayak Rice Mills (SVRM) takes into account the delays in
debt servicing due to stretched liquidity position.
Karnal-based (Haryana) SVRM established in July 2008, as a
partnership firm by Mr Rameshwar Das and his three sons, namely,
Mr Ashok Kumar, Mr Suresh Kumar and Mr Amit Kumar sharing profit
and losses equally. The firm started its commercial operations in
February 2009. The firm is engaged in milling and processing of
basmati rice with an installed capacity of 1,200 quintals per day
(QPD). The firm procures the key raw material, ie, paddy from
Haryana and Uttar Pradesh at the current market price on cash and
advance basis. The firm is also engaged in trading of rice. SVRM
sells its product domestically in states like Uttar Pradesh,
Haryana and Delhi. It also exports its product to Saudi Arabia,
Iran, Yemman and during FY14 (refers to the period April 1 to
March 31) exports comprised about 56% of the total operating
income as against 29% in FY13.
SOLACE HEALTHCARE: CRISIL Assigns 'D' Rating to INR187MM Loan
-------------------------------------------------------------
CRISIL has assigned its 'CRISIL D' rating to the long-term bank
facility of Solace Healthcare Pvt Ltd (SHPL).
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Term Loan 187 CRISIL D
The rating reflects instances of delay by the company in servicing
its term debt; the delays have been caused by weak liquidity. The
company has weak liquidity because of lower accruals during the
company's initial phase of operations.
SHPL also has a short track record and modest scale of operations.
The company, however, benefits from the promoters' extensive
experience in the healthcare industry.
Established in 2011, SHPL has set up a 125-bed super speciality
hospital in Vadodara (Gujarat). The company has started its
operations in April 2015.
SPM MARBLES: CARE Upgrades Rating on INR7cr LT Loan to BB-
----------------------------------------------------------
CARE revokes suspension and revises the rating assigned to the
bank facilities of SPM Marbles Private Limited.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank Facilities 7.00 CARE BB- Rating
suspension revoked
and revised from
CARE B+
Rating Rationale
Revision in the rating of SPM Marbles Private Limited (SMPL) takes
into account continuous increase in the scale of operations and
improvement in profitability margins during FY12-FY15 (refers to
the period April 1 to March 31). However, the rating continues to
remain constrained on account SMPL's presence in the highly
competitive marble industry and its weak financial risk profile
marked by thin profitability margins, high overall gearing and
high working capital intensity of operations. The rating is
further constrained due to linkage of marble industry to the
cyclical real estate sector.
The rating, however, continues to favourably factor in the wide
experience of the promoters in the marble industry and location
advantage due to its presence in the marble belt of India.
The company's ability to scale up its operations while improving
its profitability levels as well as capital structure and better
management of working capital would be the key rating
sensitivities.
Kishangarh-based (Rajasthan) SMPL, incorporated in 2002, was
promoted by Mr Ashish Bakliwal, Mr Sanjay Kawad and Mr Bhagwan Das
Biyani along with his son, Mr Abhishek Biyani. SMPL is engaged in
the business of processing of marble blocks as well as trading of
finished marble slabs and tiles. The processing plant of the
company is located at Kishangarh and has an installed capacity to
process 2.04 Lakh Square Meter Per Annum (LSMPA) of marble slabs
and tiles. The company is also involved in the trading of finished
marble slabs and tiles which are purchased from the local
suppliers.
SMPL's income from trading of finished marble slabs and tiles have
been in the range of 85-90% of its Total Operating Income (TOI) in
the last three financial years ended FY15and the same was around
90% of TOI in FY15. The remaining income was generated through
processing and sale of marble slabs and tiles.
The promoters have also promoted SPM Granites (I) Private Limited
(commenced operations from September, 2012) which is based at
Madurai and is involved in the processing and sale of granite
tiles.
During FY15, SMPL reported a total operating income of INR41.06
crore (FY14: INR32.34 crore) with a PAT of INR0.47 crore
(FY14: INR0.23 crore).
TRAFO POWER: CRISIL Reaffirms B+ Rating on INR65MM Cash Loan
------------------------------------------------------------
CRISIL's ratings on the bank facilities of Trafo Power and
Electricals Pvt Ltd (TPEPL) continue to reflect TPEPL's small
scale of operations in the intensely competitive transformers
industry, and large working capital requirement.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Bank Guarantee 26 CRISIL A4 (Reaffirmed)
Cash Credit 65 CRISIL B+/Stable (Reaffirmed)
Inland/Import
Letter of Credit 5 CRISIL A4 (Reaffirmed)
Term Loan 4 CRISIL B+/Stable (Reaffirmed)
These weaknesses are partially offset by promoters' extensive
industry experience.
Outlook: Stable
CRISIL believes TPEPL will continue to benefit over the medium
term from promoters' extensive industry experience. The outlook
may be revised to 'Positive' if capital structure improves,
because of equity infusion or higher-than-expected cash accrual
driven by better scale of operations, profitability, and working
capital management. Conversely, the outlook may be revised to
'Negative' if financial risk profile weakens because of decline in
revenue and profitability, or significantly large debt-funded
capital expenditure, or if liquidity is constrained by increase in
working capital requirement.
TPEPL was set up in 1996 by Agra (Uttar Pradesh)-based Mr. S K
Jain, who is the company's key promoter and managing director.
TPEPL manufactures and exports distribution and power
transformers, pressed steel radiators, corrugated wall panels, and
mild steel tanks. Its manufacturing facility is in Agra.
VEERA ASSOCIATES: CRISIL Assigns B+ Rating to INR50MM LT Loan
-------------------------------------------------------------
CRISIL has assigned its 'CRISIL B+/Stable' rating to the long term
bank facilities of Veera Associates (VA).
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Overdraft Facility 35 CRISIL B+/Stable
Long Term Loan 50 CRISIL B+/Stable
Bill Discounting 30 CRISIL B+/Stable
Export Packing Credit 10 CRISIL B+/Stable
The rating reflects VA's below-average financial risk profile,
marked by moderate gearing, small networth and weak debt
protection metrics. The rating also factors VA's modest scale- and
working capital intensive nature- of operations and exposure to
supplier concentration risk. These rating weaknesses are partially
offset by its promoters' extensive experience in the textiles
industry.
Outlook: Stable
CRISIL believes VA will continue to benefit over the medium term
from its promoters' extensive experience in the textile industry.
The outlook may be revised to 'Positive' if the firm's revenues
and profitability increase substantially, leading to an
improvement in its financial risk profile, or in case of
significant infusion of capital by the partners, resulting in an
improvement in VA's capital structure. Conversely, the outlook may
be revised to 'Negative' if the firm undertakes aggressive debt-
funded expansions, or if its revenues and profitability decline
substantially leading to weakening in its financial risk profile.
Incorporated in 2010, VA is primarily engaged in production of
Polyester viscose yarn. Based out of Guntur district in Andhra
Pradesh, VA is promoted by Mr.K.Veeraiah and his family. The day
to day operations of the firm are managed by his son
Mr.K.V.Prasad.
VA on provision basis reported a profit after tax (PAT) of Rs.5.9
million on net sales of Rs.463 million for 2014-15 (refers to
financial year, April 1 to March 31), as against a PAT of Rs.4.4
million on net sales of Rs.567 million for 2013-14.
VENKATADRI SPINNING: CRISIL Cuts Rating on INR88.2MM Loan to D
--------------------------------------------------------------
CRISIL has downgraded its ratings on the bank facilities of
Venkatadri Spinning Mills Private Limited (VSMPL) to 'CRISIL
D/CRISIL D' from 'CRISIL B-/Stable/CRISIL A4'.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Bank Guarantee 1.8 CRISIL D (Downgraded from
'CRISIL A4')
Overdraft Facility 40.0 CRISIL D (Downgraded from
'CRISIL B-/Stable')
Term Loan 88.2 CRISIL D (Downgraded from
'CRISIL B-/Stable')
The ratings downgrade reflects instances of delay by VSMPL in
servicing its debt obligations owing to the company's weak
liquidity.
VSMPL also has a below-average financial risk profile marked by
small net worth, high gearing, and weak debt protection metrics
and large working capital requirements. The rating also factors in
the company's small scale of operations in the intensely
competitive cotton yarn industry, and the susceptibility of its
profitability margins to volatility in cotton prices. These rating
weaknesses are partially offset by the extensive experience of
VSMPL's promoters in the textile industry, and its established
relationship with customers.
VSMPL was set up in 2009, as a private limited company, by Mr.
Srimannarayana and Mr. Hanumantha Rao. The company manufactures
cotton yarn; its spinning mill is in Rajahmundry (Andhra Pradesh).
VSMPL reported a profit after tax (PAT) of Rs.0.7 million on net
sales of Rs.207 million for 2014-15 (refers to financial year,
April 1 to March 31), as against a PAT of Rs.4.6 million on net
sales of Rs.203 million for 2013-14.
YOGESH TRADING: CRISIL Suspends B+ Rating on INR350MM Loan
----------------------------------------------------------
CRISIL has suspended its rating on the bank facilities of Yogesh
Trading Co. (YTC).
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 350 CRISIL B+/Stable Suspended
The suspension of rating is on account of non-cooperation by YTC
with CRISIL's efforts to undertake a review of the ratings
outstanding. Despite repeated requests by CRISIL, YTC is yet to
provide adequate information to enable CRISIL to assess YTC's
ability to service its debt. The suspension reflects CRISIL's
inability to maintain a valid rating in the absence of adequate
information. CRISIL considers information availability risk as a
key factor in its rating process as outlined in its criteria
'Information Availability - a key risk factor in credit ratings'
YTC is a partnership firm engaged in wholesale trading in denim
and other fabrics. The firm was set up in 1977 by Delhi-based
Gambhir family. The founding partner, Mr. Deepak Gambhir, along
with his younger brother, Mr. Yogesh Gambhir, looks after YTC's
day-to-day operations. The firm is based in New Delhi.
===============
M O N G O L I A
===============
SOUTHGOBI RESOURCES: Meets TSX Continued Listing Requirements
-------------------------------------------------------------
SouthGobi Resources Ltd. on Nov. 30 disclosed that the Toronto
Stock Exchange ("TSX") has confirmed and completed its review of
the Company and has determined that the Company meets TSX's
continued listing requirements.
About SouthGobi
SouthGobi, listed on the Toronto and Hong Kong stock exchanges, is
focused on exploration and development of its metallurgical and
thermal coal deposits in Mongolia's South Gobi Region. It has a
100% shareholding in SouthGobi Sands LLC, a Mongolian registered
company that holds the mining and exploration licenses in Mongolia
and operates the flagship Ovoot Tolgoi coal mine. Ovoot Tolgoi
produces and sells coal to customers in China.
====================
N E W Z E A L A N D
====================
HPH LIMITED: Restaurant Owners Face Liquidation Application
-----------------------------------------------------------
Collette Devlin at Stuff.co.nz reports that the Tasting Room owner
Danny MCGrath said an application to put his business into
liquidation was over a dispute which was in the process of being
resolved.
Stuff.co.nz relates that the owners of two well known bars in
downtown Wellington are facing a request to put them into
liquidation but will fight to stay open.
According to the report, liquor wholesaler Tasman Liquor Company
placed a public notice advertising an application to put the
companies behind The Tasting Room on Courtenay Place and General
Practitioner on Willis St into liquidation in The Dominion Post on
Nov. 26.
The notices state that an application for putting HPH Limited
(trading as the General Practitioner) and Rio Bravo Limited
(trading as The Tasting Room) was filed in the High Court at
Wellington on Nov. 2, 2015, according to Stuff.co.nz.
The report says the owner of the General Practitioner bar on
Willis St says it will not close despite a request to put it into
liquidation.
According to the report, Danny McGrath, a director of both
companies said his "long-established" businesses would not be
closing.
"This is a dispute that is in the process of being sorted," he
said.
The case will be heard on December 15, the report notes.
===============
P A K I S T A N
===============
PAKISTAN MOBILE: S&P Affirms 'B-' CCR; Outlook Remains Positive
---------------------------------------------------------------
Standard & Poor's Ratings Services affirmed its 'B-' long-term
corporate credit rating on Pakistan Mobile Communications Ltd.
(Mobilink), the biggest cellular communication services provider
in Pakistan. The outlook remains positive.
S&P affirmed its rating on Mobilink because S&P believes the
rating will continue to be constrained by S&P's sovereign credit
rating on the Islamic Republic of Pakistan (B-/Positive/B).
However, if the recently announced merger of Mobilink with Warid
Telecom (Pvt.) Ltd. is completed, S&P may revise Mobilink's stand-
alone credit profile (SACP) downward to 'b+' from 'bb-' to reflect
the higher leverage at Warid. The SACP of 'b+' would remain two
notches above the sovereign rating on Pakistan. In S&P's view,
Warid's higher leverage would weaken Mobilink's financial risk
profile.
"Although the proposed merger involves only a swap of shares, we
project Mobilink's leverage (ratio of funds from operations to
debt) to weaken to about 25%, from 50% currently," said Standard &
Poor's credit analyst Ashutosh Sharma. "The merger now requires
the approvals of regulators and lenders. We will maintain the
current SACP until further clarity emerges."
S&P believes Mobilink's operation will continue to be constrained
by Pakistan's unpredictable geopolitical and macroeconomic
environment. Therefore, S&P do not expect the merger to affect
Mobilink's business risk profile.
In addition to reducing overall competition in Pakistan, this
merger would improve Mobilink's revenue base and its overall
cellular footprint in Pakistan. Mobilink would also increase its
subscriber market share to about 38%, from about 28% currently.
Warid's revenue is roughly one third Mobilink's.
"Mobilink is likely to shift its focus toward integration and
maintaining its combined market share after the merger. This
could weaken its organic growth momentum," Mr. Sharma said.
Standard & Poor's also expects integration costs to reduce
Mobilink's current profitability (EBITDA margin) to below 35%,
from 38% currently, over the next two to three years. However,
the integration synergies would help improve its profitability to
about 40% in fiscal 2018-2019.
As both companies continue to expand their 3G/4G services, S&P
expects the capital expenditures to remain elevated in 2015 and
marginally negative free operating cash flows over the next 12-18
months. S&P believes Mobilink will be able to use its good
capital markets access to refinance Warid's higher cost debt over
the next few years, resulting in lower interest expense in future.
S&P also believes Mobilink will be able to manage covenant
pressure, if any, arising from the merger.
The positive outlook on Mobilink reflects the rating outlook on
Pakistan.
S&P could revise the outlook back to stable if it do the same for
Pakistan sovereign rating. S&P is unlikely to lower the rating
due to the merger or even if the operating and financial
performances deteriorate further. However, if the merger is
completed, S&P may lower the SACP to 'b+'.
S&P could raise the rating on Mobilink if S&P raises the sovereign
rating on Pakistan.
===============
X X X X X X X X
===============
* Outlook for Asian Cos. Clouded by Subdued Growth, Moody's Says
----------------------------------------------------------------
Moody's Investors Service says that slower economic growth in Asia
and high leverage will present key challenges for Asian (ex-Japan)
non-financial corporates in 2016, although domestic monetary
easing, adequate liquidity and manageable bond refinancing
requirements should prevent a major uptick in defaults for rated
issuers in the region.
"Continued slower growth across the region, along with external
risks -- including uncertainty over the US rate trajectory and
capital flow volatility -- will put Asian corporate credit
fundamentals to the test in 2016," says Brian Cahill, Managing
Director, Asia Pacific Corporate and Financial Institutions.
"Given these challenging conditions, we view domestic factors as
increasingly important to corporates' credit quality," adds Rahul
Ghosh, a Moody's Vice President and Senior Research Analyst.
"Whereas corporates in China (Aa3 stable) are under pressure from
the country's sustained economic slowdown, India's (Baa3 positive)
economic growth outperformance and monetary easing will support
credit conditions."
Cahill and Ghosh were speaking on the release of Moody's 2016
outlook presentation for Asian (ex-Japan) companies.
While many corporates across the region have responded to weaker
growth, demand and prices by lowering their capital spending,
weaker earnings and margins have offset such cuts, leaving
leverage elevated.
Leverage -- as measured by adjusted debt to EBITDA -- is forecast
at an average 4.9x for the full year 2015, up from 4.7x in 2014
and 4.2x in 2013.
Reflecting weak financial flexibility particularly in the high
yield space, the number of downgrades on high-yield ratings
increased 60% in the first nine months of 2015 from the same
period last year.
Over 30% of outlooks on high-yield ratings have a negative bias,
pointing to further challenges in this space in 2016.
However, easing domestic market monetary conditions and strong
liquidity in those markets should prevent a major increase in
defaults in 2016. In addition, maturing rated foreign currency
high yield bonds are modest compared to annual issuance volumes in
recent years and so should be refinanced relatively comfortably
for most.
*********
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 ***