/raid1/www/Hosts/bankrupt/TCRAP

/raid1/www/Hosts/bankrupt/TCRAP_Public/160225.mbx T R O U B L E D C O M P A N Y R E P O R T E R A S I A P A C I F I C Thursday, February 25, 2016, Vol. 19, No. 39 Headlines A U S T R A L I A CANDELLA ELECTRICAL: First Creditors' Meeting Set For March 1 EXA WEB: Goes Into Liquidation; 60 Jobs Axed PALMER AVIATION: In Liquidation; Palmer's Assets Up For Sale PLASTERBOARD WEST: Goes into Liquidation REEDMANS SHEETMETAL: First Creditors' Meeting Set For March 3 SLATER & GORDON: Shares Suspended Ahead of Interim Earnings STRUCTURAL MAINTENANCE: First Creditors' Meeting Set For March 4 ULTIMATE ELECTRICAL: First Creditors' Meeting Set For March 2 WATTPOWER PTY: First Creditors' Meeting Scheduled For March 3 C H I N A COUDERT BROTHERS: Orrick Says China Sale Claims to Fail at Trial MAOYE INTERNATIONAL: Moody's Lowers CFR to Caa1; Outlook Negative H O N G K O N G NOBLE GROUP: Moody's Cuts CFR to Ba3; Under Review for Downgrade I N D I A ADITYA MOTORS: CRISIL Assigns 'B' Rating to INR50MM Loan AISHWARYA TECHNOLOGIES: CARE Reaffirms B- INR7.11cr Loan Rating ALIGARH ROLLER: Ind-Ra Suspends 'IND B+' Long-Term Issuer Rating BHAVANAM TEXTILES: CARE Assigns B+ Rating to INR9.57cr Loan BHUSHAN POWER: Ind-Ra Withdraws 'IND BB' Long-Term Issuer Rating DELTA JEWELLERS: Ind-Ra Upgrades LT Issuer Rating to 'IND BB' DOABA KHALSA: Ind-Ra Rates INR336MM Term Loans Facility 'IND D' GANAPATHI SPINNING: CRISIL Reaffirms B+ Rating on INR150MM Loan GE GODAVARI: Ind-Ra Suspends 'IND B+' Long-Term Issuer Rating GIRRAJ JI: Ind-Ra Assigns 'IND BB+' Long-Term Issuer Rating H. P. ZALA: CRISIL Reaffirms B- Rating on INR50MM Cash Loan HANUMAN DAL: CARE Assigns B+ Rating to INR35cr LT Loan HARIYANA INTERNATIONAL: CRISIL Cuts Rating on INR2BB Loan to B+ HARIYANA SHIP: CRISIL Cuts Rating on INR4.0BB Loan to B+ HARIYANA SHIP DEMOLITION: CRISIL Cuts INR2.0BB Loan Rating to B+ HITECH PRINT: CARE Revises Rating on INR11.87cr Loan to 'B+' HOTEL VAKRATUNDA: Ind-Ra Assigns 'IND B' Long-Term Issuer Rating IMPRESSION FURNITURE: CRISIL Assigns B+ Rating to INR50MM Loan IND-BARATH POWERGENCOM: CARE Cuts Rating on INR281.86cr Loan to D ISHAN INTERNATIONAL: Ind-Ra Affirms 'IND B+' LT Issuer Rating K.B.N. JEWELLERY: Ind-Ra Suspends 'IND B' Long-Term Issuer Rating KAILASH CASTINGS: CRISIL Assigns B+ Rating to INR55MM Loan KAMDHENU COTTON: CRISIL Reaffirms B+ Rating on INR172MM Loan KUSMASULI MULTIPURPOSE: CRISIL Ups Rating on INR55.5MM Loan to B LORD GANESH: Ind-Ra Suspends 'IND B+' Long-Term Issuer Rating M.P. AGARWALA: CRISIL Ups Rating on INR60MM Cash Loan to 'B' MAGPET POLYMERS: CRISIL Ups Rating on INR83.9MM Loan to B+ MAHIPAL FOOD: CRISIL Assigns 'B' Rating to INR150MM Cash Loan MASCONS ENGINEERING: CRISIL Cuts Rating on INR50MM Loan to D MAT WHITE: CRISIL Assigns 'B' Rating to INR150MM Cash Loan MD. QUIYAMUDDIN: CRISIL Cuts Rating on INR84MM Cash Loan to D MJ AND SONS: CRISIL Ups Rating on INR380MM LT Loan to B- MODEL EXIMS: Ind-Ra Suspends 'IND BB-' Long-Term Issuer Rating MOUNT SHIVALIK: CRISIL Cuts Rating on INR100MM Loan to 'D' PATEL INCORPORATION: CRISIL Assigns B+ Rating to INR75MM Loan PIONEER STEELS: Ind-Ra Withdraws IND B+ Long-Term Issuer Rating PRINCEMARINE TRANSPORT: CARE Lowers Rating on INR5.5cr Loan to C R. D. SALES: CRISIL Assigns 'B' Rating to INR40MM LT Loan RAILONE PROJECTS: Ind-Ra Suspends 'IND BB-' LT Issuer Rating RAJ ISPAT: CARE Assigns 'B+' Rating to INR7cr LT Loan RAJ STEEL: CARE Assigns B+ Rating to INR5cr LT Loan RAJENDRA KUMAR: Ind-Ra Affirms 'IND BB' Long-Term Issuer Rating RAJINDER & CO.: Ind-Ra Suspends 'IND B+' LT Issuer Rating ROYAL PLAZA: CRISIL Assigns 'D' Rating to INR100MM Term Loan S. E. ENTERPRISES: CRISIL Assigns B Rating to INR50MM Cash Loan SACHDEVA RICE: CRISIL Cuts Rating on INR100MM Loan to B- SAHANU SPONGE: CARE Reaffirms B+ Rating on INR12.30cr LT Loan SHANKAR FLOUR: Ind-Ra Suspends 'IND B-' Long-Term Issuer Rating SHUBH ALUMINIUM: CARE Assigns 'B/A4' Rating to INR14cr Loan SINGH CYCLE: CRISIL Assigns B+ Rating to INR100MM Loan SREE KOPPAMMAL: CRISIL Reaffirms 'D' Rating on INR110MM Loan SUNLEX FABRICS: CARE Ups Rating on INR7.69cr Loan to 'BB-' SWASTIK OIL: CARE Assigns 'B' Rating to INR87.1cr LT Loan UTTORAYON TEA: CRISIL Reaffirms B Rating on INR57.5MM Term Loan VANTAGE SPINNERS: CARE Reaffirms 'B+' Rating on INR68.75cr Loan VARSHA SUPER: CRISIL Assigns B+ Rating to INR67.5MM Cash Loan VINAY WIRES: Ind-Ra Affirms 'IND BB' Long-Term Issuer Rating WESTERN INDIA: CARE Assigns B+ Rating to INR8.24cr LT Loan I N D O N E S I A ENERGI MEGA: S&P Lowers LT CCR to 'B-'; Outlook Negative P H I L I P P I N E S LBC DEVELOPMENT: Garnishment Order on Unit's Accounts Lifted S O U T H K O R E A DOOSAN INFRACORE: IPO Plan Will be Credit Positive, Moody's Says MAGNACHIP SEMICONDUCTOR: Moody's Affirms Caa2 CFR; Outlook Stable X X X X X X X X * South Asian NOC Face Higher Risk of Downgrade, Moody's Says - - - - - ================= A U S T R A L I A ================= CANDELLA ELECTRICAL: First Creditors' Meeting Set For March 1 ------------------------------------------------------------- Malcolm Kimbal Howell and Glenn Anthony Crisp of Jirsch Sutherland were appointed as administrators of Candella Electrical Pty Ltd on Feb. 19, 2016. A first meeting of the creditors of the Company will be held at Jirsch Sutherland, Melbourne, Level 12, 460 Lonsdale Street, in Melbourne, on March 1, 2016, at 10:30 a.m. EXA WEB: Goes Into Liquidation; 60 Jobs Axed -------------------------------------------- Jeff Whalley at Herald Sun reports that sixty workers have lost their jobs at Melbourne tech company Exa Web Solutions after liquidators were called in on Feb. 22. But at the same time about 250 workers in India and Thailand employed by the same director will keep their jobs as it is understood he retains control of those operations which are still solvent and fireproofed from changes, Herald Sun says. According to Herald Sun, the company which does online work for companies including Ingham, UNSW and The Cheesecake Shop were placed in the hands of Deloitte Restructuring Services on Feb. 22. The company was founded in 2000 and labels itself "Australia's number one online marketing and web solutions company". Herald Sun says the 60 Australian workers spread across its Melbourne head office and offices in Sydney, Brisbane and Perth all lost their jobs after liquidators found no way to continue trading. Four companies that collectively trade as Exa Web Solutions and Exa Business Technologies were swept up in the action. These include Exa Pty Ltd, Exa Franchising Pty Ltd, Exa Holdings Pty Ltd and Exasites Pty Ltd. Employees with outstanding entitlements have access to the Federal Government's Fair Entitlements Guarantee scheme, the report states. "We will be contacting customers as soon as possible to advise them of the situation. We will do whatever we can within the context of the liquidation to minimise service disruption for customers," Herald Sun quotes Joint Liquidator and Deloitte Restructuring Services partner Glen Kanevsky as saying. "We are working with the director to develop strategies to extract as much value as possible from the intellectual property assets." PALMER AVIATION: In Liquidation; Palmer's Assets Up For Sale ------------------------------------------------------------ ABC News reports that administrators have moved to sell assets owned by companies belonging to federal MP Clive Palmer, including a Bombardier Global Express aircraft that is the property of Palmer Aviation, which owes AUD26 million. ABC News says creditors of Mr Palmer's aviation company met on Feb. 23 in Sydney and decided to put it into liquidation. According to the report, liquidators FTI Consulting said the process would start in March. "At that meeting, creditors resolved to place the company into liquidation, with FTI Consulting to act as liquidators," an FTI statement confirmed, ABC News relays. "The liquidators will now prepare the company's only asset -- a Bombardier Global Express aircraft -- for sale." Mr Palmer's 6,000 hectare cattle property, Mamelon Station, located north of Rockhampton, will also go under the hammer next month, the report notes. ABC News relates that FTI Consulting said the proceeds from the sale of the property would go toward the cost of running of the federal MP's Queensland Nickel refinery at Yabulu near Townsville, which is currently under voluntary administration. It said cash flow for the refinery was a critical issue, ABC News says. Surplus equipment, including trucks from the refinery, have already been sold to improve Queensland Nickel's cash flow, the report notes. ABC News says the Townsville refinery went into voluntary administration last month, just days after it laid off more than 237 people. According to ABC News, John Park from FTI Consulting said on January 29 the company was more than AUD100 million in debt, with 1,500 creditors and more than AUD30 million owed in outstanding employee entitlements. At that time, Mr Park estimated that Queensland Nickel would need a cash injection of tens of millions of dollars to continue trading beyond April 30, says the report. He said for the 2016 financial year, the company was forecast to produce approx 60 million pounds of nickel at a cash loss of 50 US cents per pound. It is not yet clear whether other assets from Mr Palmer's business empire will go on sale to provide funds for Queensland Nickel, ABC News says. ABC News relates that it is understood money from Queensland Nickel helped pay for vintage cars and dinosaurs at the Palmer Coolum Resort on Queensland's Sunshine Coast, which closed its doors in March last year. At that time, Mr Palmer announced plans for a major refurbishment of the resort. However, Sunshine Coast Council has received no development applications for the property. Local councilor Steve Robinson said Mr Palmer's financial difficulties made it increasingly unlikely the resort would ever return to be the "jewel in the coast's tourism crown" it had been before Mr Palmer bought it. The resort's golf course, which once hosted the Australian PGA tournament, remains open, ABC News notes. ABC News adds that Cr Robinson said the council had offered to help Mr Palmer but he has had minimal contact. He said the golf course could not be touched, but if Mr Palmer wanted to subdivide part of the resort council would consider all requests. Mr Palmer has also been locked in a bitter battle with villa owners at the resort. When contacted by the ABC, Mr Palmer said he was busy in Federal Parliament and could not comment until Feb. 26. PLASTERBOARD WEST: Goes into Liquidation ---------------------------------------- Cliff Sanderson at Dissolve.com.au reports that Plasterboard West Pty Ltd has gone into liquidation. Gary John Anderson of HLB Mann Judd has been appointed liquidator of the company on Feb. 12, 2016. Earlier in February, the company entered receivership under the control of FTI Consulting, Dissolve.com.au relates. Plasterboard West Pty Ltd was a supplier of construction lining product and building materials. It offered a range from wall cladding and insulation products to plasterboards and accessories. REEDMANS SHEETMETAL: First Creditors' Meeting Set For March 3 ------------------------------------------------------------- Todd William Kelly of BDO (NTH QLD) was appointed as administrator of Reedmans Sheetmetal Pty Ltd on Feb. 22, 2016. A first meeting of the creditors of the Company will be held at the office of BDO (NTH QLD), Level 1, 15 Lake Street, Cairns, in the State of Queensland, on March 3, 2016, at 10:00 a.m. SLATER & GORDON: Shares Suspended Ahead of Interim Earnings ----------------------------------------------------------- Jonathan Shapiro at The Sydney Morning Herald reports that Slater & Gordon shares have been suspended from trading ahead of the company reporting its interim results on February 29. SMH relates that in a statement to the Australian Securities Exchange, company secretary Moana Weir said 'certain material items' had not been finalised, such as the goodwill values for impairment of the UK business. The "voluntary suspension" is so that the company can meet its continous disclosure obligations ahead of finalising a potential goodwill write-down, SMH relays. According to the report, Slater & Gordon said "it continues to work with its auditors and external advisors to finalise and confirm" these items. Shares of Slater & Gordon closed on Feb. 23 at 83 cents, valuing the law firm at just under AUD300 million. In late March, the personal injury law firm's market capitalisation peaked at almost AUD2.75 billion. The company showed AUD1.15 billion of "goodwill" on its book when it reported full year financial results for 2015, SMH discloses. In March, Slater & Gordon acquired the professional services division from UK listed firm Quindell for AUD1.3 billion, of which AUD710 million was a "goodwill" consideration, SMH recalls. However, that acquisition has proved ill-fated, straining the law firm's cash flows, while touted regulatory changes have cast doubt over future profits from fast-track road accident claims, SMH relates. Slater & Gordon's lenders have appointed advisers to assess the company's books, according to the reports. SMH adds that recent disclosures from Westpac, a major lender to Slater & Gordon, showed it had increased provisions relating to a property and business services loan, which the bank told analysts was an exposure to Slater & Gordon. STRUCTURAL MAINTENANCE: First Creditors' Meeting Set For March 4 ---------------------------------------------------------------- Nick Cooper and Raj Khatri of Worrells Solvency & Forensic Accountants were appointed as administrators of Structural Maintenance and Contracting Australia Pty Ltd on Feb. 23, 2016. A first meeting of the creditors of the Company will be held at Worrells Solvency & Forensic Accountants, Suite 1103, Level 11, 147 Pirie Street, in Adelaide, on March 4, 2016, at 10:30 a.m. ULTIMATE ELECTRICAL: First Creditors' Meeting Set For March 2 ------------------------------------------------------------- Steve Naidenov and David Iannuzzi of Veritas Advisory were appointed as administrators of Ultimate Electrical & Security Pty Ltd on Feb. 19, 2016. A first meeting of the creditors of the Company will be held at Level 12, 88 Pitt Street, in Sydney, on March 2, 2016, at 10:00 a.m. WATTPOWER PTY: First Creditors' Meeting Scheduled For March 3 ------------------------------------------------------------- Terrence John Rose and David Michael Stimpson of SV Partners were appointed as administrators of Wattpower Pty Ltd on Feb. 22, 2016. A first meeting of the creditors of the Company will be held at SV Partners, 138 Mary Street, in Brisbane, Queensland, on March 3, 2016, at 10:30 a.m. ========= C H I N A ========= COUDERT BROTHERS: Orrick Says China Sale Claims to Fail at Trial ---------------------------------------------------------------- Matt Chiappardi at Bankruptcy Law360 reported that Orrick Herrington & Sutcliffe LLP told a New York federal judge on Feb. 11, 2016, that the claims from defunct law firm Coudert Brothers LLP's Chapter 11 plan administrator stemming from the bygone firm's sale of its Chinese assets to Orrick are so weak that there's no need for a trial. In a trial memorandum before the New York federal court, Orrick argued that plan administrator Development Specialists Inc. falls short of carrying its burden to prove that Coudert didn't receive equivalent value in its sale. About Coudert Brothers Coudert Brothers LLP was an international law firm specializing in complex cross-border transactions and dispute resolution. The firm had operations in Australia and China. Coudert filed for Chapter 11 protection (Bankr. S.D.N.Y. Case No. 06-12226) on Sept. 22, 2006. John E. Jureller, Jr., Esq., and Tracy L. Klestadt, Esq., at Klestadt & Winters, LLP, represented the Debtor in its restructuring efforts. Brian F. Moore, Esq., and David J. Adler, Esq., at McCarter & English, LLP, represented the Official Committee of Unsecured Creditors. Coudert scheduled total assets of $30.0 million and total debts of $18.3 million as of the Petition Date. The Bankruptcy Court in August 2008 signed an order confirming Coudert's chapter 11 plan. The Plan contemplated on paying 39% to unsecured creditors with $26 million in claims. Coudert has been succeeded by Development Specialists, Inc., in its capacity as Plan Administrator under the confirmed chapter 11 plan. MAOYE INTERNATIONAL: Moody's Lowers CFR to Caa1; Outlook Negative ----------------------------------------------------------------- Moody's Investors Service has downgraded Maoye International Holdings Ltd.'s corporate family rating (CFR) to Caa1 from B1. At the same time, Moody's has downgraded the company's senior unsecured ratings to Caa2 from B2. The ratings outlook is negative. RATINGS RATIONALE "The downgrade reflects our concern over Maoye's increased probability of default," says Lina Choi, a Moody's Vice President and Senior Credit Officer. "We believe the company's debt repayment risk has increased, because of its weakening operating cash flow and the potential cash drainage from further acquisitions." "The downgrade also reflects heightened financial risk from its high debt leverage," adds Choi, who is also the Lead Analyst for Maoye. Maoye's liquidity position is weak. At June 30, 2015, its cash and deposits to debt maturing over the next 12 months were at around 0.15x. Given the weaker retail market conditions in China, the company's weak liquidity position will likely deteriorate further over the next 12 months, in the absence of measures to raise cash. As such, Maoye's probability of debt default will increase. Moody's notes Maoye's announced profit warning for the full year ended Dec. 31, 2015, and expects the company to generate weak EBITDA over the next 12-18 months. Pressured by weak operating performance in both its retail and property businesses, Moody's expects that Maoye's debt leverage -- as measured by adjusted debt/EBITDA -- will increase to around 8.5x in 2015 and around 10x in 2016-2017 compared to 6.6x at end- 2014. Such levels are weaker than those of its single-B rated peers in the retail sector. At the same time, the company maintains an aggressive business strategy. Maoye made a number of acquisitions during the fiscal year ended Dec. 31, 2015, resulting in a total cash outflow of RMB3.9 billion. The company announced on Feb. 19, 2016, a potential acquisition in Inner Mongolia. Moody's expects that the acquisition will consume its cash and increase its gross debt. Consequently, Moody's estimates that Maoye's recurring cash flow/debt adjusted for cash, deposit and short term investments will likely fall below 5% over the coming 12-18 months from 8%-12% during 2013-2014. The negative ratings outlook reflects Moody's concern over Maoye's high refinancing risk and the fact that its deteriorating financial position could reduce the recovery by bondholders in the event of a default. The prospect of upward rating pressure in the near term is limited, given the negative outlook on the ratings. But the outlook could return to stable if the company demonstrates an improvement in both its liquidity position and debt leverage. Indicative ratios include cash/short-term debt close to 0.75x- 1.00x and adjusted debt/EBITDA below 6.5x. Downgrade rating pressure could arise if Maoye fails to meet its payment obligations. The principal methodology used in these ratings was Retail Industry published in October 2015. Maoye International Holdings Ltd. is one of the leading department store operators in China (Aa3 stable). Headquartered in Shenzhen, Guangdong Province, the company has built a strong position in its home market, while strategically expanding elsewhere in the country. The company had 41 stores in 17 cities across China's four main regions at end-June 2015. ================ H O N G K O N G ================ NOBLE GROUP: Moody's Cuts CFR to Ba3; Under Review for Downgrade ---------------------------------------------------------------- Moody's Investors Service has downgraded Noble Group Limited's corporate family rating and senior unsecured bond ratings to Ba3 from Ba1 and the provisional rating on its senior unsecured medium-term note (MTN) program to (P)Ba3 from (P)Ba1. The ratings are under review for further downgrade. RATINGS RATIONALE On Feb. 23, 2016, Noble announced that it will book $1.2 billion in non-cash asset impairment charges, which are in addition to the expected write-down of over $500 million related to the sale of its remaining 49% stake in Noble Agri Limited. The asset impairment was primarily triggered by a lowering in its anchor price for thermal coal to reflect the prolonged weakness in coal prices. "The downgrade reflects the impact of the unexpected assets write- down on Noble's business and financial profile," says Joe Morrison, a Moody's Vice President and Senior Credit Officer. Moody's estimates the write-downs will increase Noble's adjusted net debt/net capitalization to about 58% at end-2015 from about 51% at end-September 2015. "The asset impairment significantly heightens uncertainty regarding its ability to achieve adequate profitability and cash flow, given our expectation of a prolonged commodity down-cycle, and the consequent negative impact on its relationships with banks and counterparties," adds Morrison. The rating review reflects concerns regarding progress in resolving its liquidity issue as well as the consequences of the impairment charges. Moody's expects that the receipt in 1Q 2016 of $750 million in proceeds from the sale of its remaining 49% stake in Noble Agri Limited (unrated) will help improve Noble's liquidity profile. Noble also reported that operating cash flow reached about $650 million (before interest expenses) in 2H 2015, and that reported net debt declined by over $200 million from 3Q to 4Q 2015. However, Noble's liquidity position will remain constrained until it refinances approximately $1.6 billion in bank facilities due in May 2016. Moody's review will examine (1) Noble's execution on its plan to refinance the May 2016 facilities, including the pricing and conditions associated with the new facilities; (2) the implications of the asset write-downs and resultant impact on Noble's business and bank relationships; (3) the execution of plans to raise capital, lower operating expenses, reduce working capital utilization, and strengthen cash flow generation. The ratings could be downgraded if there is no material progress in refinancing the bank facilities within the next few weeks. The principal methodology used in these ratings was Trading Companies published in March 2015. Noble Group Limited is the largest global physical commodities supply chain manager in Asia by revenue. Its diversified activities across the supply chain include the sourcing, storage, processing, transportation, and distribution of over 20 commodity products. Headquartered in Hong Kong, Noble Group Limited operates offices in 60 locations globally, and employs 1,900 staff. The company is publicly traded on the Singapore Stock Exchange. Founder and Chairman, Mr. Richard Elman, holds an approximate 22% stake in the company. China Investment Corporation -- the Chinese sovereign wealth fund -- owns about 10% of the company. ========= I N D I A ========= ADITYA MOTORS: CRISIL Assigns 'B' Rating to INR50MM Loan -------------------------------------------------------- CRISIL has assigned its 'CRISIL B/Stable' rating to the long-term bank facilities of Aditya Motors (AM). Amount Facilities (INR Mln) Ratings ---------- --------- ------- Cash Credit 6 CRISIL B/Stable Inventory Funding Facility 50 CRISIL B/Stable The rating reflects AM's initial phase of operations, dependence on performance of Tata Motors Ltd (TML) and success of TML's car models, and exposure to intense competition in the automotive dealership business. These weaknesses are partially offset by experience of AM's promoters in dealership of two-wheelers in Jamnagar. Outlook: Stable AM will benefit from its promoters' industry experience. The outlook may be revised to 'Positive' in case of higher-than- expected operating revenue or profitability, leading to increase in cash accrual, and consequently, a better capital structure. Conversely, the outlook may be revised to 'Negative' if accrual is lower than expected, or if financial risk profile deteriorates because of significant stretch in working capital cycle. AM, set up by Mr. Ajay Singh Chattrasingh Chudsama and Mr. Harvijay Singh Chattrasingh Chudsama in 2015, is an authorised dealer of TML's passenger cars in Jamnagar with a 3S (showroom, spares, and services) facility. It is setting up a showroom in Jamnagar, which is expected to commence operations in April 2016. AISHWARYA TECHNOLOGIES: CARE Reaffirms B- INR7.11cr Loan Rating --------------------------------------------------------------- CARE reaffirms the ratings assigned to bank facilities of Aishwarya Technologies & Telecom Limited. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long term Bank Facilities 7.11 CARE B- Reaffirmed Short term Bank Facilities 4.50 CARE A4 Reaffirmed Long-term/Short-term Bank 6.00 CARE B-/CARE A4 Facilities Reaffirmed Rating Rationale The ratings assigned to the bank facilities of Aishwarya Technologies and Telecom Limited (ATTL) continue to be constrained by relatively small scale of operation, elongated operating cycle days primarily due to delayed realisation from telecom clients and continued net loss during FY15 (refers to the period April 01 to March 31). However, the ratings are underpinned by the satisfactory experience of the promoters in the telecom equipment industry, in-house research & development facility, exclusive distributorship with suppliers and low debt level. The ability of the company to diversify the order book, successfully execute projects in timely manner and efficiently recover the long-standing receivables are the key rating sensitivities. ATTL was promoted by Mr G Rama Manohar Reddy and Mrs G Amulya Reddy as a partnership firm named Advanced Electronics & Communications System. ATTL was formed by taking over the business of the said partnership firm and. ATTL is a ISO 9001:2008 certified company, which manufactures testing & measuring equipments like fiber, data and copper cable fault locators for telephone service providers, defense sector, cable TV operators and railways. The company has its manufacturing facilities situated at Hyderabad and it supplies a wide range of telecom & fiber optic products to Bharat Sanchar Nigam Limited, Tata Tele Services, Bharati Airtel, Mahanagar Telephone Nigam Limited, railways & defense sectors in India. During FY15, ATTL reported a total operating income of INR31.99 crore with a PBILDT of INR0.54 crore and net loss of 2.02 crore compared with total operating income of INR26.95 crore with a PBILDT of INR3.15 crore and net loss of INR0.25 crore in FY14. During H1FY16, the company reported a total operating income of INR23.60 crore with a PBILDT of INR0.42 crore and net loss of INR0.60 crore. ALIGARH ROLLER: Ind-Ra Suspends 'IND B+' Long-Term Issuer Rating ---------------------------------------------------------------- India Ratings and Research (Ind-Ra) has migrated Aligarh Roller Flour Mills Private Limited's 'IND B+' Long-Term Issuer Rating to the suspended category. The Outlook was Stable. The rating will now appear as 'IND B+(suspended)' on the agency's website. A full list of rating actions is at the end of this commentary. The ratings have been migrated to the suspended category due to lack of adequate information. Ind-Ra will no longer provide ratings or analytical coverage for Aligarh Roller Flour Mills. The ratings will remain in the suspended category for a period of six months and be withdrawn at the end of that period. However, in the event the issuer starts furnishing information during this six-month period, the ratings could be reinstated and will be communicated through a rating action commentary. Aligarh Roller Flour Mills' ratings: -- Long-Term Issuer Rating: migrated to 'IND B+(suspended)' from 'IND B+'/Stable -- INR88.5 million fund based limits: migrated to 'IND B+(suspended)' and IND A4(suspended) from 'IND B+'/ and 'IND A4` -- INR2.45 million term loan: migrated to 'IND B+(suspended)' from 'IND B+' BHAVANAM TEXTILES: CARE Assigns B+ Rating to INR9.57cr Loan ----------------------------------------------------------- CARE assigns 'CARE B+' rating to the bank facilities of Bhavanam Textiles (India) Private Limited. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long-term Bank Facilities 9.57 CARE B+ Assigned Rating Rationale The rating assigned to the bank facilities of Bhavanam Textiles (India) Private Limited (BTIPL) is constrained by the inexperience of the promoters in cotton yarn manufacturing segment, short track record with small scale of operations albeit increase in income during FY15 (refers to the period April 1 to March 31), low profit margins with losses during FY14-FY15 coupled with susceptibility of profit margins to fluctuations in raw material prices, leveraged capital structure with weak debt coverage indicators and the company's presence in the highly fragmented industry regulated by the government. The rating is however, underpinned by the established track record of the promoters in other businesses coupled with financial support being extended in the form of unsecured loans, strategic location of the manufacturing facility within cotton producing areas, government support to textile industry and satisfactory working capital cycle despite working capital intensive nature of operations. The ability of the company to further increase the scale of operations along with an improvement in profitability in a highly competitive scenario and improvement in the capital structure are the key rating sensitivities. Bhavanam Textiles (India) Private Ltd. (BTIPL) was incorporated on February 27, 2013 by Mr Bhavanam Rama Koti Reddy and Mrs Bhavanam Adi Lakshmi after the promoters took over the operations of another company, Pujita Spinning Mills Limited. Commercial operations of the company commenced from April 1, 2013 and FY14 (refers to the period April 1 to March 31) was the first full year of operation. The company is engaged in the manufacturing of cotton yarn through its manufacturing unit at Thimmapuram village, Guntur district, Andhra Pradesh, with an installed capacity of 13,644 spindles. During FY15, BTIPL reported a net loss of INR0.09 crore (FY14: net loss of INR0.31 crore) on a total operating income of INR20.97 crore (FY14: INR9.43 crore). Furthermore, during H1FY16 (unaudited), the company has reported PAT of INR0.29 crore on total operating income of INR12.36 crore. BHUSHAN POWER: Ind-Ra Withdraws 'IND BB' Long-Term Issuer Rating ---------------------------------------------------------------- India Ratings and Research (Ind-Ra) has withdrawn Bhushan Power & Steel Limited's (BPSL) 'IND BB(suspended)' Long-Term Issuer Rating. The ratings have been withdrawn due to lack of adequate information. Ind-Ra will no longer provide ratings or analytical coverage for BPSL. Ind-Ra suspended BPSL's ratings on 19 June 2015 BPSL's ratings are as follows: -- Long-Term Issuer Rating: 'IND BB(suspended)'; rating withdrawn -- INR220 billion long-term bank loans: 'IND BB(suspended)'; rating withdrawn -- INR36.67 billion fund-based working capital limits: 'IND BB(suspended)'; rating withdrawn -- INR33.77 billion non fund-based working capital limits: 'IND A4+(suspended)'; rating withdrawn -- INR10 billion short-term loans: 'IND A4+(suspended)'; rating withdrawn DELTA JEWELLERS: Ind-Ra Upgrades LT Issuer Rating to 'IND BB' ------------------------------------------------------------- India Ratings and Research (Ind-Ra) has upgraded Delta Jewellers Pvt Ltd's Long-Term Issuer Rating to 'IND BB' from 'IND BB-'. The Outlook is Stable. Ind-Ra has also upgraded Delta Jewellers' INR70 million fund-based working capital limits to 'IND BB'/Stable from 'IND BB-'. KEY RATING DRIVERS The upgrade reflects Delta Jewellers' improved scale of operations on account of higher sales as reflected from its revenue of INR376 million in FY15 (FY14: INR321 million), and stable operating EBITDA margins of 3.8% (3.9%). Its net leverage also improved to 3x in FY15 (FY14: 5.7x) on account of lower debt levels, while interest coverage remained comfortable at 1.7x (2.3x). The upgrade also factors in the comfortable liquidity profile of the company as reflected in its average working capital utilisation of around 78% during the 12 months ended January 2016. The ratings however remain constrained by the trading nature of the company's business and volatility in gold prices along with the small scale of operations. RATING SENSITIVITIES Positive: An improvement in the scale of operations along with an overall improvement in the credit profile will be positive for the ratings. Negative: Any fall in the profitability leading to deterioration in the credit metrics will be negative for the ratings. COMPANY PROFILE Incorporated in 2006, Delta Jewellers is a franchise of Tanishq and deals in gold and diamond jewellery. The company has its registered office and retail showroom in Durgapur, West Bengal and is managed by Mr. Dokania and family. DOABA KHALSA: Ind-Ra Rates INR336MM Term Loans Facility 'IND D' --------------------------------------------------------------- India Ratings and Research (Ind-Ra) has assigned Doaba Khalsa Trust's (DKT) INR336 million term loans facility an 'IND D' rating. KEY RATING DRIVERS The rating reflects DKT's irregularity in debt servicing in 2015 due to its strained liquidity profile and limited size of operations. The term loan facility of the society was restructured in October 2015. RATING SENSITIVITIES The rating could be upgraded if the loan obligations are serviced in a timely manner for at least one quarter. COMPANY PROFILE DKT is a charitable educational trust registered under Indian Trust Act. It was established in 1997-1998 by S. Khushia Singh Bath. The trust started with a polytechnic college in 1997-1998. It expanded to a pharmacy college and an engineering and technical college both affiliated to Punjab Technical University. The campus is situated in Mohali, Punjab. GANAPATHI SPINNING: CRISIL Reaffirms B+ Rating on INR150MM Loan --------------------------------------------------------------- CRISIL's rating on the bank facility of Ganapathi Spinning Mill (GSM) continues to reflect the firm's moderate scale of operations in the intensely competitive textile industry and vulnerability to volatile raw material prices. The rating also factors in GSM's working capital intensity operations and below-average financial risk profile marked by weak debt protection metrics. These rating weaknesses are partially offset by the promoters' extensive experience and established customer relationships. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Cash Credit 150 CRISIL B+/Stable (Reaffirmed) Outlook: Stable CRISIL believes GSM will continue to benefit over the medium term from the promoters' extensive experience. The outlook may be revised to 'Positive' if significant improvement in scale of operations and profitability, and efficient working capital management strengthen financial risk profile. Conversely, the outlook may be revised to 'Negative' if decline in revenue or profitability, stretch in working capital cycle, or any large, debt-funded capital expenditure weakens the financial risk profile. Set up in 1997 in Palladam, Tamil Nadu, GSM manufactures grey cotton fabric. The firm is promoted by Mr. Shantakumar and his family. GE GODAVARI: Ind-Ra Suspends 'IND B+' Long-Term Issuer Rating ------------------------------------------------------------- India Ratings and Research (Ind-Ra) has migrated GE Godavari Engineering Limited (GEGEL) 'IND B+' Long-Term Issuer Rating with a Stable Outlook to the suspended category. This rating will now appear as 'IND B+(suspended)' on the agency's website. A full list of rating actions is at the end of this commentary. The ratings have been migrated to the suspended category due to lack of adequate information. Ind-Ra will no longer provide ratings or analytical coverage for GEGEL. The ratings will remain in the suspended category for a period of six months and be withdrawn at the end of that period. However, in the event the issuer starts furnishing information during the six- month period, the ratings could be reinstated and will be communicated through a rating action commentary. GEGEL' ratings are as follows: -- Long-Term Issuer Rating migrated to 'IND B+(suspended)' from 'IND B+'/Stable -- INR106.0 million fund-based working capital limits: migrated to 'IND B+(suspended)' and 'IND A4(suspended)' from 'IND B+' and 'IND A4' -- INR50.0 million non-fund-based working capital limits: migrated to 'IND A4(suspended)' from 'IND A4' GIRRAJ JI: Ind-Ra Assigns 'IND BB+' Long-Term Issuer Rating ----------------------------------------------------------- India Ratings and Research (Ind-Ra) has assigned Girraj Ji Stone Crushers Private Limited (GSCPL) a Long-Term Issuer Rating of 'IND BB+'. The Outlook is Stable. KEY RATING DRIVERS The ratings reflect GSCPL's small scale of operations, evidenced by its INR212.99 million revenue in FY15 (FY14: INR33.77 million; FY13: INR252.87 million) and tight liquidity, due to its average working capital utilisation of around 100% during the 12 months ended January 2016. The ratings also reflect the nature of GSCPL's business, which is highly dependent on government regulations and the availability of tenders/projects; any adverse change in policy may severely hamper operations. However, the ratings are supported by GSCPL's comfortable credit metrics in FY15, with interest coverage (operating EBITDA/gross interest expense) of 3.20x (FY14: 4.10x; FY13: 5.86x) and net financial leverage (total adjusted debt/operating EBITDAR: 2.03x; 2.03x; 1.40x). The ratings further draw comfort from GSCPL's promoters' long operational record and experience of around four decades in the railway construction industry. RATING SENSITIVITIES Negative: Deterioration in GSCPL's operating EBITDA margin, leading to weaker credit metrics, will be negative for the ratings. Positive: A substantial improvement in the top line while sustaining credit metrics, will be positive for the ratings. COMPANY PROFILE GSCPL was incorporated in 1994 and is an 'A' class contractor engaged in the tender-based business of ballast supply, linking of railway tracks and construction of railway under bridges and railway over bridges as well as other construction work in various parts of India. Its current order book position stands at INR1,013.42 million. GSCPL's ratings: -- Long-Term Issuer Rating: assigned 'IND BB+'/Stable -- INR13.70 million fund-based working capital limits: assigned 'IND BB+'/Stable/'IND A4+' -- INR58.70 million non-fund-based limits: assigned 'IND A4+' H. P. ZALA: CRISIL Reaffirms B- Rating on INR50MM Cash Loan ----------------------------------------------------------- CRISIL's ratings on the bank facilities of H. P. Zala (HPZ) continue to reflect the firm's modest scale of operations with large geographical concentration and below-average financial risk profile constrained by small networth and low cash accrual. These weaknesses are partially offset by the extensive experience of the promoters in the civil construction industry with funding support. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Bank Guarantee 20 CRISIL A4 (Reaffirmed) Cash Credit 50 CRISIL B-/Stable (Reaffirmed) Outlook: Stable CRISIL believes HPZ's business risk profile will continue to benefit from the established presence of the promoters in the construction industry in Gujarat. The outlook may be revised to 'Positive' upon a substantial increase in the scale of operations arising from the firm's better flow of order book and timely realisation of the debtors. Conversely, the outlook may be revised to 'Negative' in case of lower-than-expected cash accrual on account of lower-than-expected scale of operations or profitability or a significant increase in working capital requirements leading to weaker liquidity. Update Revenue is expected to be modest, at INR60-65 million, in 2015-16 (refers to financial year, April 1 to March 31) on account of low order book position. Operating profitability is expected to be moderate at 20-22 percent, in line with previous years. The working capital requirements will remain large, with high gross current assets expected mainly driven by large inventory levels of 130-150 days along with high debtors of 90-100 days resulting in full utilisation of its bank limits. The financial risk profile is expected to remain below average because of small networth of INR22-25 million against high working capital borrowings resulting in a highly leveraged capital structure and weak debt protection metrics. HPZ was set up in 1976 as a proprietorship concern by Mr. H P Zala. The operations of the firm were taken over by Mr. Naresh H Zala. It undertakes civil construction activities, such as drainage work and sewerage lines, in Gujarat. HPZ mainly executes projects for state government entities. HANUMAN DAL: CARE Assigns B+ Rating to INR35cr LT Loan ------------------------------------------------------ CARE assigns 'CARE B+' rating to the bank facilities of Hanuman Dal Industries Private Limited. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long term Bank Facilities 35 CARE B+ Assigned Rating Rationale The rating assigned to the bank facilities of Hanuman Dal Industries Private Limited (HDUPL) is constrained on account of the project execution and stabilization risk, vulnerability to fluctuations in prices of raw material, working capital intensive nature of operations and presence in a highly fragmented and regulated industry which depends heavily on the weather conditions prevailing in the country. The above weaknesses are partially offset by the extensive experience of the promoters in the agro-based industry along with their established relations with customers and suppliers, support from the group companies in terms of marketing and technical aspects. The rating further takes a note that financial closure of the project has been achieved. The ability of the company to complete the project as per the scheduled timeline and without any cost overrun is a key rating sensitivity. Incorporated in the year 2015, HDIPL belongs to the Bolla group of Nagpur, promoted by the Bolla family that is currently managing eight entities including HDIPL. The company proposes to set up a tur-dal processing unit at Nagpur, Maharashtra, with a proposed processing capacity of 150 MTPD. The project is in its initial stage and commercial production of the project is expected to start by July 2016. HARIYANA INTERNATIONAL: CRISIL Cuts Rating on INR2BB Loan to B+ --------------------------------------------------------------- CRISIL has downgraded the rating on Hariyana International Private Limited (HIPL; part of the Hariyana group) bank facility to 'CRISIL B+/Stable' from 'CRISIL BB-/Stable'. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Letter of Credit 2000 CRISIL B+/Stable (Downgraded from 'CRISIL BB-/Stable') The rating downgrade reflects deterioration in Hariyana group's business profile marked by weakened operating profitability. The group's operating margin is expected to decline in 2015-16 from 2014-15 levels in the wake of softening steel prices. Additionally, the operating margin is expected to continue to remain weak over the medium term driven by oversupply of steel and subdued demand conditions prevailing globally. The lower price realization of its products, procured against letters of credit (LCs), constrains its credit profile, particularly its liquidity. The liquidity is further constrained by loans to third parties remaining at the same level, as against expectations of a decline in their quantum. The receipt of the loans continues to remain a key rating sensitivity factor affecting the group's credit profile, especially liquidity over the medium term. CRISIL's ratings on the bank facilities of HIPL continue to reflect Hariyana group's exposure to risks inherent in the ship breaking, steel trading, and money-lending businesses, and the group's extant investments in unrelated businesses, such as real- estate. These rating weaknesses are partially offset by the group's moderate financial risk profile, marked by a healthy net worth and moderate gearing, and will continue to benefit from its promoter's track record of more than 30 years in the ship-breaking industry. For arriving at the ratings, CRISIL has combined the business and financial risk profiles of HSBL, Hariyana Ship Breakers Ltd (HSBL), Hariyana International Pvt Ltd (HIPL), and Inducto Steel Ltd. This is because these entities, collectively referred to as the Hariyana group, have significant operational linkages and fungible cash flows, and are under a common management. Outlook: Stable CRISIL believes that Hariyana group will remain exposed to risks inherent in ship-breaking. The outlook may be revised to 'Positive' if the group recovers its funds advanced to third parties sooner than expected or achieves significantly higher profitability or revenue growth thereby improving its liquidity profile. Conversely, the outlook may be revised to 'Negative' if Hariyana group incurs losses in its money-lending businesses, witnesses a steep decline in its revenues, or weakens its capital structure by undertaking a larger-than-expected debt-funded capital expenditure programme. The Hariyana group, promoted by Mr. Shanti Sarup Reniwal, is primarily into ship breaking and steel trading. The group also undertakes inter-corporate lending activities, and develops residential real estate projects. For 2014-15 (refers to financial year, April 1 to March 31), HSDPL reported a PAT of INR26.9 million on net sales of INR1.77 billion, against a PAT of INR46.4 million on net sales of INR2.31 billion for 2013-14. For 2014-15, HIPL reported a profit after tax (PAT) of INR17.5 million on net sales of INR1.59 billion, against a PAT of INR18.1 million on net sales of INR1.34 billion for 2013-14. For 2014-15, HSBL reported a PAT of INR141.4 million on net sales of INR2.69 billion, against a PAT of INR131.9 million on net sales of INR5 billion for 2013-14. HARIYANA SHIP: CRISIL Cuts Rating on INR4.0BB Loan to B+ -------------------------------------------------------- CRISIL has downgraded the rating on Hariyana Ship Breakers Limited (HSBL; part of the Hariyana group) bank facility to 'CRISIL B+/Stable' from 'CRISIL BB-/Stable'. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Letter of Credit 4000 CRISIL B+/Stable (Downgraded from 'CRISIL BB-/Stable') The rating downgrade reflects deterioration in Hariyana group's business profile marked by weakened operating profitability. The group's operating margin is expected to decline in 2015-16 from 2014-15 levels in the wake of softening steel prices. Additionally, the operating margin is expected to continue to remain weak over the medium term driven by oversupply of steel and subdued demand conditions prevailing globally. The lower price realization of its products, procured against letters of credit (LCs), constrains its credit profile, particularly its liquidity. The liquidity is further constrained by loans to third parties remaining at the same level, as against expectations of a decline in their quantum. The receipt of the loans continues to remain a key rating sensitivity factor affecting the group's credit profile, especially liquidity over the medium term. CRISIL's ratings on the bank facilities of HSBL continue to reflect Hariyana group's exposure to risks inherent in the ship breaking, steel trading, and money-lending businesses, and the group's extant investments in unrelated businesses, such as real- estate. These rating weaknesses are partially offset by the group's moderate financial risk profile, marked by a healthy net worth and moderate gearing, and will continue to benefit from its promoter's track record of more than 30 years in the ship-breaking industry. For arriving at the ratings, CRISIL has combined the business and financial risk profiles of HSBL, Hariyana Ship Breakers Ltd (HSBL), Hariyana International Pvt Ltd (HIPL), and Inducto Steel Ltd. This is because these entities, collectively referred to as the Hariyana group, have significant operational linkages and fungible cash flows, and are under a common management. Outlook: Stable CRISIL believes that Hariyana group will remain exposed to risks inherent in ship-breaking. The outlook may be revised to 'Positive' if the group recovers its funds advanced to third parties sooner than expected or achieves significantly higher profitability or revenue growth thereby improving its liquidity profile. Conversely, the outlook may be revised to 'Negative' if Hariyana group incurs losses in its money-lending businesses, witnesses a steep decline in its revenues, or weakens its capital structure by undertaking a larger-than-expected debt-funded capital expenditure programme. The Hariyana group, promoted by Mr. Shanti Sarup Reniwal, is primarily into ship breaking and steel trading. The group also undertakes inter-corporate lending activities, and develops residential real estate projects. For 2014-15 (refers to financial year, April 1 to March 31), HSDPL reported a PAT of INR26.9 million on net sales of INR1.77 billion, against a PAT of INR46.4 million on net sales of INR2.31 billion for 2013-14. For 2014-15, HIPL reported a profit after tax (PAT) of INR17.5 million on net sales of INR1.59 billion, against a PAT of INR18.1 million on net sales of INR1.34 billion for 2013-14. For 2014-15, HSBL reported a PAT of INR141.4 million on net sales of INR2.69 billion, against a PAT of INR131.9 million on net sales of INR5 billion for 2013-14. HARIYANA SHIP DEMOLITION: CRISIL Cuts INR2.0BB Loan Rating to B+ ---------------------------------------------------------------- CRISIL has downgraded the rating on Hariyana Ship Demolition Private Limited (HSDPL; part of the Hariyana group) bank facility to 'CRISIL B+/Stable' from 'CRISIL BB-/Stable'. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Letter of Credit 2000 CRISIL B+/Stable (Downgraded from 'CRISIL BB-/Stable') The rating downgrade reflects deterioration in Hariyana group's business profile marked by weakened operating profitability. The group's operating margin is expected to decline in 2015-16 from 2014-15 levels in the wake of softening steel prices. Additionally, the operating margin is expected to continue to remain weak over the medium term driven by oversupply of steel and subdued demand conditions prevailing globally. The lower price realization of its products, procured against letters of credit (LCs), constrains its credit profile, particularly its liquidity. The liquidity is further constrained by loans to third parties remaining at the same level, as against expectations of a decline in their quantum. The receipt of the loans continues to remain a key rating sensitivity factor affecting the group's credit profile, especially liquidity over the medium term. CRISIL's ratings on the bank facilities of HSDPL continue to reflect Hariyana group's exposure to risks inherent in the ship breaking, steel trading, and money-lending businesses, and the group's extant investments in unrelated businesses, such as real- estate. These rating weaknesses are partially offset by the group's moderate financial risk profile, marked by a healthy net worth and moderate gearing, and will continue to benefit from its promoter's track record of more than 30 years in the ship-breaking industry. For arriving at the ratings, CRISIL has combined the business and financial risk profiles of HSBL, Hariyana Ship Breakers Ltd (HSBL), Hariyana International Pvt Ltd (HIPL), and Inducto Steel Ltd. This is because these entities, collectively referred to as the Hariyana group, have significant operational linkages and fungible cash flows, and are under a common management. Outlook: Stable CRISIL believes that Hariyana group will remain exposed to risks inherent in ship-breaking. The outlook may be revised to 'Positive' if the group recovers its funds advanced to third parties sooner than expected or achieves significantly higher profitability or revenue growth thereby improving its liquidity profile. Conversely, the outlook may be revised to 'Negative' if Hariyana group incurs losses in its money-lending businesses, witnesses a steep decline in its revenues, or weakens its capital structure by undertaking a larger-than-expected debt-funded capital expenditure programme. The Hariyana group, promoted by Mr. Shanti Sarup Reniwal, is primarily into ship breaking and steel trading. The group also undertakes inter-corporate lending activities, and develops residential real estate projects. For 2014-15 (refers to financial year, April 1 to March 31), HSDPL reported a PAT of INR26.9 million on net sales of INR1.77 billion, against a PAT of INR46.4 million on net sales of INR2.31 billion for 2013-14. For 2014-15, HIPL reported a profit after tax (PAT) of INR17.5 million on net sales of INR1.59 billion, against a PAT of INR18.1 million on net sales of INR1.34 billion for 2013-14. For 2014-15, HSBL reported a PAT of INR141.4 million on net sales of INR2.69 billion, against a PAT of INR131.9 million on net sales of INR5 billion for 2013-14. HITECH PRINT: CARE Revises Rating on INR11.87cr Loan to 'B+' ------------------------------------------------------------ CARE revises the lt rating and reaffirms the st rating assigned to the bank facilities of Hitech Print Systems Limited. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long-term Bank Facilities 11.87 CARE B+ Revised from CARE B Short-term Bank Facilities 3.50 CARE A4 Reaffirmed Rating Rationale The revision in the long-term rating assigned to the bank facilities of Hitech Print Systems Limited (HPSL) takes into account improvement in the financial and liquidity profile of the company marked by growth in the total income and PAT margin during FY15 (refers to the period April 01 to March 31) along with improvement in overall gearing and debt coverage indicators. The ratings also factor in the satisfactory experience of the promoters and moderate order book position. The ratings are, however, constrained by relatively small scale of operation, working capital intensive nature of operation and intense competition in the industry. The ability of the company to expand the scale of operation with improvement in profitability and working capital cycle are the key rating sensitivities. Incorporated in 1986, HPSL is an ISO 9001-2008 certified entity (Quality Certification) engaged in the printing business at its manufacturing facility (capacity: 37.6 MTPA) located at Peddavutapalli Village in Krishna District. The product portfolio includes high security documents like cheque books, interest and dividend warrants, utility bills, OMR sheets and question papers for educational institutions. HPSL is also involved in printing customized business stationary like gift vouchers, food vouchers, inserts for newspapers, etc. The company is approved by Indian Banking Association and is also a member of Print Services Distribution Association. HPSL is a wholly-owned subsidiary of Hyderabad-based Anjani Projects & Constructions Ltd (APCL). During FY15, HPSL achieved a total income of INR47.92 crore (FY14: INR44.66 crore) and PAT of INR1.18 crore (FY14: INR0.77 crore). As per the unaudited results for H1FY16, HPSL posted a PAT of INR0.63 crore on a total operating income of INR23.01 crore. HOTEL VAKRATUNDA: Ind-Ra Assigns 'IND B' Long-Term Issuer Rating ---------------------------------------------------------------- India Ratings and Research (Ind-Ra) has assigned Hotel Vakratunda a Long-Term Issuer Rating of 'IND B'. The Outlook is Stable. The company has also assigned the company's INR62.5 million term loan an 'IND B' rating with Stable Outlook. KEY RATING DRIVERS The ratings reflect Hotel Vakratunda's promoters' experience of more than a decade in the hospitality sector. The entity has set up a hotel and restaurant in Naddi, Dharamshala (Himachal Pradesh) and its commercial operations are likely to start from March 2016. The project is funded by a term loan of INR62.5 million. The ratings benefit from the locational advantage of the hotel, by being situated close to Mc LeodGanj which is a major tourist attraction. The ratings are constrained by the entity's presence in the highly competitive and fragmented hotel industry with low entry barriers. RATING SENSITIVITIES Negative: Any delays in commercial operations or lower-than- expected occupancy levels impacting the revenues will be negative for the ratings. Positive: The entity's ability to execute the project and ramp up the operations on time along with achieving stable business operations will be positive for the ratings. COMPANY PROFILE Hotel Vakratunda is a proprietorship entity and is into the hotel and restaurant business. IMPRESSION FURNITURE: CRISIL Assigns B+ Rating to INR50MM Loan -------------------------------------------------------------- CRISIL has assigned its 'CRISIL B+/Stable/CRISIL A4' ratings to the bank facilities of Impression Furniture Industries (IFI). The ratings reflect the firm's modest scale of operations, tender based nature of business, and working capital-intensive operations. These weaknesses are partially offset by the extensive experience of the promoters and average financial risk profile marked by moderate gearing. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Bank Guarantee 20 CRISIL A4 Cash Credit 50 CRISIL B+/Stable Outlook: Stable CRISIL believes IFI will benefit from the promoters' experience in the home furnishing industry. The outlook may be revised to 'Positive' if the firm stabilises its operations leading to larger-than-expected cash accrual and improved working capitalcycle. Conversely the outlook may be revised to 'Negative' if IFI's accrual is lower than expectations due to reduced order flow or profitability, or its financial risk profile weakens due to a stretch in the working capital cycle or large, debt-funded capital expenditure. Incorporated in 1996, IFI is owned and managed by Sukhmani family based out of Bhopal. IFI manufactures furniture for the central government and the Madhya Pradesh (MP) government. The firm supplies furniture in 61 districts of MP. Around 80 percent of revenue is contributed by the state government through tender route. The firm recorded book profit of INR1.61 million on operating income of INR111.6 million in 2014-15 as against book profit of INR3.26 million on operating income of INR157.0 million in 2013- 14. IND-BARATH POWERGENCOM: CARE Cuts Rating on INR281.86cr Loan to D ----------------------------------------------------------------- CARE revises the ratings assigned to the bank facilities of Ind-Barath Powergencom Limited. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long-term Bank Facilities 281.86 CARE D Revised from CARE BB+ Short-term Bank Facilities 96.00 CARE D Revised from CARE A4+ Rating Rationale The revision in the ratings assigned to the bank facilities of Ind-Barath Powergencom Limited (IBPGL) is on account of delays in debt servicing at the back of stressed liquidity position owing to delayed realization from debtors. IBPGL belongs to the IndBarath group and is a subsidiary (99.94%) of Ind-Barath Power Infra Limited (IBPIL), the flagship company of the group. Incorporated on July 25, 2005, IBPGL has set up a coastal coal-based thermal power project of capacity 189 (3 x 63) MW power plant in Thoothukudi District in Tamil Nadu in two phases with Phase 1 of 126 MW (2 x 63) which commenced operations in January 2010 and Phase 2 of 63 MWwhich commenced operations inMay 2011. IBPGL has entered into short-term Power Purchase Agreement (PPA) on September 27, 2014, with Tamil Nadu Generation and Distribution Corporation Limited (TANGEDCO) for supply of 135 MW power at net tariff of INR5.50/Kwh for a period of 1 year from October 1, 2014, to November 30, 2015. Post November 2015, the company has been supplying power to group captive consumers. During FY15 (refers to the period April 01 to March 31), IBPGL reported PAT of INR3.39 crore (Rs.32.14 crore in FY14) on a total income of INR544.78 crore (Rs.554.04 crore in FY14). ISHAN INTERNATIONAL: Ind-Ra Affirms 'IND B+' LT Issuer Rating ------------------------------------------------------------- India Ratings and Research (Ind-Ra) has affirmed Ishan International's (ISIN) Long-Term Issuer Rating at 'IND B+'. The Outlook is Stable. The agency has also affirmed the company's INR347.50 million fund-based limits (increased from INR300.00 million) at 'IND B+'/Stable and 'IND A4'. KEY RATING DRIVERS The affirmation reflects ISIN's weak credit profile and volatile EBITDA margins. In FY15, net leverage (total Ind-Ra adjusted net debt/operating EBITDAR) was 12.36x (FY14: 12.56x), interest cover (operating EBITDA/gross interest expense) was 1.07x (1.03x) and EBITDA margins were 4.67% (3.01%). EBITDA margins fluctuated between 3.01% and 4.67% over FY12-FY15 due to raw material price volatility. Also, the firm operates in the highly commoditised and fragmented rice processing industry, susceptible to seasonal trends, government interventions and monsoon fluctuations. The ratings also factor in the firm's tight liquidity due to high working capital intensity. Its average use of the working capital limits was 93.07% over the 12 months ended January 2016. The ratings also reflect the partnership structure of the entity. However, the ratings are supported by ISIN's founders over 40 years of experience in the rice processing industry, established customer relationships, growth in revenue and healthy growth prospects for the rice industry. RATING SENSITIVITIES Negative: A negative rating action could result from a further stretch on the liquidity profile and/or a decline in the operating profitability leading to deterioration in the overall credit metrics. Positive: A positive rating action could result from an improvement in the operating profitability leading to improvements in the overall credit metrics. COMPANY PROFILE Incorporated in 1999 in Haryana, ISIN is a partnership firm engaged in the business of rice milling. The total installed capacity of its plant is 40MT of paddy processing per day. The firm uses paddy as raw material and rice is the final product. K.B.N. JEWELLERY: Ind-Ra Suspends 'IND B' Long-Term Issuer Rating ---------------------------------------------------------------- India Ratings and Research (Ind-Ra) has migrated K.B.N. Jewellery's 'IND B' Long-Term Issuer Rating to the suspended category. The Outlook was Stable. The rating will now appear as 'IND B(suspended)' on the agency's website. The agency has also migrated the company's INR80 million fund-based limits to 'IND B(suspended)' and 'IND A4(suspended)' from 'IND B' and 'IND A4`. The ratings have been migrated to the suspended category due to lack of adequate information. Ind-Ra will no longer provide ratings or analytical coverage for K.B.N. Jewellery. The ratings will remain in the suspended category for a period of six months and be withdrawn at the end of that period. However, in the event the issuer starts furnishing information during this six-month period, the ratings could be reinstated and will be communicated through a rating action commentary. KAILASH CASTINGS: CRISIL Assigns B+ Rating to INR55MM Loan ---------------------------------------------------------- CRISIL has assigned its 'CRISIL B+/Stable' rating to the long-term bank loan facility of Kailash Castings Limited (KCL). Amount Facilities (INR Mln) Ratings ---------- --------- ------- Cash Credit 55 CRISIL B+/Stable The rating reflects the company's low operating margin and modest scale of operations in the highly fragmented steel industry. These rating weaknesses are partially offset by the extensive industry experience of KCL's promoters and its moderate financial risk profile because of low gearing. Outlook: Stable CRISIL believes KCL will continue to benefit over the medium term from its promoters' extensive industry experience. The outlook may be revised to 'Positive' in case of significant increase in scale of operations and operating profitability, along with improvement in debt-protection metrics and prudent working capital management. Conversely, the outlook may be revised to 'Negative' if the financial risk profile, particularly liquidity, deteriorates, most likely because of a decline in revenue and profitability, larger- than-expected, debt-funded capital expenditure, or an increase in working capital requirement. KCL was incorporated in 2004 and started commercial operations from 2005. The company manufactures mild steel ingots with an installed capacity of 25,000 tonnes per annum. It is promoted by Mr. Abhay Kumar Singh, Mr. Arun Kumar Tayal, and Mr. Sandeep Gupta. KAMDHENU COTTON: CRISIL Reaffirms B+ Rating on INR172MM Loan ------------------------------------------------------------ CRISIL's ratings on the bank facilities of Kamdhenu Cotton and Spinning Mills Private Limited (KCSM) continue to reflect the company's modest scale of operations, volatile operating profitability in the highly fragmented textile industry, and average financial risk profile because of high gearing and below- average debt protection metrics. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Bank Guarantee 5 CRISIL A4 (Reaffirmed) Cash Credit 58 CRISIL B+/Stable (Reaffirmed) Letter of Credit 10 CRISIL A4 (Reaffirmed) Proposed Long Term Bank Loan Facility 27.5 CRISIL B+/Stable (Reaffirmed) Standby Line of Credit 7.5 CRISIL B+/Stable (Reaffirmed) Term Loan 172 CRISIL B+/Stable (Reaffirmed) These weaknesses are partially offset by the extensive experience of KCSM's promoters and their funding support, and efficient working capital management. Outlook: Stable CRISIL believes KCSM will continue to benefit over the medium term from promoters' extensive experience. The outlook may be revised to 'Positive' if capital structure improves either through equity infusion or substantial cash accrual, backed by ramp-up in operations and sustained profitability. Conversely, the outlook may be revised to 'Negative' if financial risk profile deteriorates because of decline in revenue and profitability, large, debt-funded capital expenditure (capex), or if liquidity weakens due to increase in working capital requirement. Update Revenue at INR443.7 million in 2014-15 (refers to financial year, April 1 to March 31) was marginally lower than expectation due to reduced demand from regional players. Turnover is expected at INR455-460 million in 2015-16 due to advanced manufacturing process. Change in entry tax law in Punjab led to lower realisation from sales, which resulted in weak operating profitability (5.4 percent). However, margin is expected to recover to 11 percent in 2015-16 with increased revenue from recycled yarn. Efficient working capital management is reflected in gross current assets and inventory of 21 and 10 days, respectively, as on March 31, 2015. Bank limit utilisation was moderate at 75 percent on an average over the 17 months through December 2015. Also, funding from the promoters (equity of INR10.5 million in 2015-16) supports liquidity. Financial risk profile is average because of high gearing of 2.36 times as on March 31, 2015, and weak debt protection metrics: interest coverage and net cash accrual to total debt ratios were 1.1 and 0.05 time, respectively, for 2014-15. Networth was also modest and stood at INR69.5 million as on March 31, 2015. Cash accrual of INR28.0 million and INR31.8 million in 2015-16 and 2016-17, respectively, will tightly match term debt obligation of INR27.8 million and INR27.1 million for the corresponding periods. However, absence of capex plans over the medium term will support liquidity. Incorporated in 2008 and promoted by the Ludhiana-based Dhir and Johar families, KCSM commenced operations in January 2013 and manufactures synthetic yarn (polyester, polyester-blended, and acrylic yarn). Mr. Puneet Dhir and his brother-in-law, Mr. Manav Johar, manage operations. Net loss was INR22.2 million on net sales of INR443.7 million for 2014-15, against a net profit of INR0.02 million on net sales of INR406.7 million for 2013-14. KUSMASULI MULTIPURPOSE: CRISIL Ups Rating on INR55.5MM Loan to B ---------------------------------------------------------------- CRISIL has upgraded its ratings on the bank facilities of Kusmasuli Multipurpose Cold Storage Private Limited (KMCSPL) to 'CRISIL B/Stable/CRISIL A4' from 'CRISIL D/CRISIL D'. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Bank Guarantee 1.3 CRISIL A4 (Upgraded from 'CRISIL D') Cash Credit 55.5 CRISIL B/Stable (Upgraded from 'CRISIL D') Term Loan 32.5 CRISIL B/Stable (Upgraded from 'CRISIL D') Working Capital 4.5 CRISIL B/Stable (Upgraded Facility from 'CRISIL D') The rating upgrade reflects timely servicing of term debt obligation by KMCSPL over the past 12 months ended December, 2015, driven by comfortable liquidity position marked by sufficient cash accrual of INR8.7 million to meet debt obligation of INR5 million in 2014-15 (refers to financial year, April 1 to March 31). The revenue level of KMCSPL also witnessed improvement with net sales increased by 9 percent in 2014-15 to INR32.8 million from INR29.8 million in 2013-14 due to upward revision in the storage rates. The rating continues to reflect KMCSPL's small scale of operations, weak financial risk profile, marked by low net-worth and low debt protection metrics. The ratings also factor in the company's susceptibility to regulatory changes and intense competition in the cold storage industry in West Bengal (WB). These weaknesses are partially offset by promoters' extensive industry experience in the cold storage industry. Outlook: Stable CRISIL believes KMCSPL will continue to benefit over the medium term from its promoters' extensive experience in the cold storage business. The outlook may be revised to 'Positive' if the company efficiently manages farmer credit financing, significantly scales up operations, and improves profitability. Conversely, the outlook may be revised to 'Negative' in case of pressure on liquidity because of delays in repayment by farmers, low cash accrual, or large debt-funded capital expenditure. KMCSPL, incorporated by Mr. Nandalal Ghosh and Mr. Bibekananda Sannigrahi in 2011, operates a cold storage unit for potatoes, with capacity of 16,000 tonne, in Paschim Medinipur, West Bengal. The company occasionally trades in potatoes to ensure optimum capacity utilisation of the cold storage unit. It also finances farmers' potato storage, which is refinanced by banks. LORD GANESH: Ind-Ra Suspends 'IND B+' Long-Term Issuer Rating ------------------------------------------------------------- India Ratings and Research (Ind-Ra) has migrated Lord Ganesh Roller Flour Mills' (LGRFM) 'IND B+' Long-Term Issuer Rating to the suspended category. The Outlook was Stable. The rating will now appear as 'IND B+ (suspended)' on the agency's website. The agency has also migrated the company's INR60 million fund-based working capital limit to 'IND B+ (suspended)' from 'IND B+'. The ratings have been migrated to the suspended category due to lack of information. Ind-Ra will no longer provide ratings or analytical coverage for LGRFM. The ratings will remain in the suspended category for a period of six months and be withdrawn at the end of that period. However, in the event the issuer starts furnishing information during the six- month period, the ratings could be reinstated and will be communicated through a rating action commentary. M.P. AGARWALA: CRISIL Ups Rating on INR60MM Cash Loan to 'B' ------------------------------------------------------------ CRISIL has upgraded its rating on the long-term bank facility of M.P. Agarwala (MPA) to 'CRISIL B/Stable' from 'CRISIL B-/Stable' and reaffirmed its rating on the short-term facility at 'CRISIL A4'. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Bank Guarantee 90 CRISIL A4 (Reaffirmed) Cash Credit 60 CRISIL B/Stable (Upgraded from 'CRISIL B-/Stable') The upgrade reflects improvement in the firm's business risk profile and operating efficiency due to steady revenue growth and improved operating profitability. Revenue increased to INR246.4 million in 2014-15 (refers to financial year, April 1 to March 31) from INR212.9 million the previous year due to healthy project execution. Operating margin improved to 13.4 percent from 12.4 percent supported by project management expertise. The promoters have a track record of more than two decades in undertaking civil contracts in North-East India, which has helped to maintain a healthy relationship with suppliers, and also in undertaking projects with a minimal cost or time overrun. This has resulted in a healthy return on capital employed of around 14.6 percent in 2014-15. Further, the firm has an outstanding order book of INR750 million as on, February 2016 which provides adequate revenue visibility over the medium term to sustain the business risk profile. The ratings reflect the firm's modest scale, and working capital- intensive nature, of operations. These rating weaknesses are partially offset by the extensive experience of MPA's proprietor in the civil construction industry, and the firm's moderate profitability. Outlook: Stable CRISIL believes MPA will continue to benefit over the medium term from the extensive industry experience of its proprietor. The outlook may be revised to 'Positive' in case of significant growth in scale of operations and profitability, along with improvement in the firm's working capital cycle. Conversely, the outlook may be revised to 'Negative' in case of deterioration in the firm's financial risk profile, most likely due to lengthening of its operating cycle, a decline in revenue or profitability, or large debt-funded capital expenditure. Established in 2010, MPA is a proprietorship firm set up by Mr. Mahabir Prasad Agarwala. The firm undertakes civil construction of buildings, roads, and bridges for the public works departments of Assam and Meghalaya, and for the North-East Council. MAGPET POLYMERS: CRISIL Ups Rating on INR83.9MM Loan to B+ ---------------------------------------------------------- CRISIL has upgraded its rating on the long-term bank facilities of Magpet Polymers Private Limited (MPPL) 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 ---------- --------- ------- Bank Guarantee 10 CRISIL A4 (Reaffirmed) Cash Credit 35 CRISIL B+/Stable (Upgraded from 'CRISIL B/Stable') Letter of Credit 3.2 CRISIL A4 (Reaffirmed) Term Loan 83.9 CRISIL B+/Stable (Upgraded from 'CRISIL B/Stable') Proposed Long Term 9.7 CRISIL B+/Stable (Upgraded Bank Loan Facility from 'CRISIL B/Stable') The upgrade reflects improvement in MPPL's business risk profile due to stabilisation of newly setup facilities and healthy operating profitability. The company commercialised operations in December 2014 and recorded revenue of INR55 million in four months of operation in 2014-15 (refers to financial year, April 1 to March 31). The company's performance was strong till the third quarter of 2015-16, with sales of INR254.9 million till January 2016. Operating margin was also healthy, at 16.4 percent in 2014- 15, supported by reputed clientele. CRISIL believes business risk profile of MPPL will improve over the medium term supported by steady orders from reputed customer base providing healthy revenue visibility over the medium term. The ratings reflect intense competition in the polyethylene terephthalate (PET) bottle manufacturing business, and MPPL's below-average financial risk profile because of small networth, high gearing, and weak debt protection metrics. These weaknesses are partially offset by its promoter's extensive industry experience. Outlook: Stable CRISIL Believes MPPL will continue to benefit from its promoter's extensive experience in the PET bottle manufacturing business. The outlook may be revised to 'Positive' if operating profitability increases along with healthy cash accrual, or a substantial capital infusion by the promoter. Conversely, the outlook may be revised to 'Negative' if financial risk profile and liquidity weaken with stretched working capital cycle or significant, debt- funded capital expenditure. Magpet Polymers Private Limited (MPPL), incorporated in September 2004, is involved in manufacturing of polyethylene terephthalate (PET) preforms, PET bottles, plastic enclosures, plastic inserts and moulded items. The company commenced operations from December 2014 and the day to day operations are being managed by Mr. Devendra Surana. MAHIPAL FOOD: CRISIL Assigns 'B' Rating to INR150MM Cash Loan ------------------------------------------------------------- CRISIL has assigned its 'CRISIL B/Stable' rating to the long-term bank facility of Mahipal Food and Gum Industries (MFGI). Amount Facilities (INR Mln) Ratings ---------- --------- ------- Cash Credit 150 CRISIL B/Stable The rating reflects MFGI's weak financial risk profile because of high gearing and subdued debt protection measures, and vulnerability of its operating profitability to volatility in raw material prices. These weaknesses are partially offset by partners' extensive experience in the commodity trading industry and their funding support. Outlook: Stable MFGI will benefit over the medium term from its partner's extensive industry experience. The outlook may be revised to 'Positive' if increase in revenue and profitability, and prudent working capital management lead to considerably stronger net cash accrual, or if capital structure improves because of capital infusion. Conversely, the outlook may be revised to 'Negative' if significant decline in revenue or profitability, or increase in working capital requirement, or any large debt-funded capital expenditure weakens financial risk profile. MFGI, a partnership firm of Mr. Sanjay Mahipal, Ms. Munni Devi, and Ms. Nisha Mahipal, processes and manufactures guar split and mustard oil. Its processing unit is at Sriganganagar, Rajasthan, and has installed capacity of 120 tonne per day (tpd) for guar gum and 50 tpd for mustard oil. MASCONS ENGINEERING: CRISIL Cuts Rating on INR50MM Loan to D ------------------------------------------------------------ CRISIL has downgraded its rating on the long-term bank facility of Mascons Engineering & Contracting Company Private Limited (Mascons) to 'CRISIL D' from 'CRISIL B/Stable'. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Term Loan 50 CRISIL D (Downgraded from 'CRISIL B/Stable') The rating downgrade reflects delays by Mascons in servicing interest obligation on term loan due to stretched liquidity, which is in turn because of low saleability of project and low customer advances. The company is also exposed to risks related to completion of ongoing project and to cyclicality in the real estate industry. However, Mascons benefits from promoter's experience in the civil construction industry. Incorporated in 2004, in Chennai and promoted by Mr. Said Mohammed, Mascons undertakes civil construction and real estate development. Mascons reported a profit after tax (PAT) of INR1.6 million on total revenue of INR46.2 million for 2014-15 (refers to financial year, April 1 to March 31), against a PAT of INR1.1 million on total revenue of INR44.1 million for 2013-14. MAT WHITE: CRISIL Assigns 'B' Rating to INR150MM Cash Loan ---------------------------------------------------------- CRISIL has assigned its 'CRISIL B/Stable' rating to the long-term bank facility of Mat White Gum Industries Private Limited (MWG). The rating reflects MWG's below-average financial risk profile, because of high gearing, and vulnerability of its operating profitability to volatility in raw material prices. These weaknesses are partially offset by the promoters' extensive experience in the commodity trading industry and their funding support. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Cash Credit 150 CRISIL B/Stable Outlook: Stable CRISIL believes MWG will benefit over the medium term from the promoters' extensive industry experience. The outlook may be revised to 'Positive' if increase in revenue and profitability and prudent working capital management lead to considerably better net cash accrual, or if the capital structure improves because of capital infusion. Conversely, the outlook may be revised to 'Negative' if a significant decline in revenue or profitability, or an increase in working capital requirement, or any large debt- funded capital expenditure weakens the financial risk profile. MFGI, promoted by Mr. Sanjay Mahipal, Mr. Ramavtar Mahipal, Ms. Munni Devi, and Ms. Nisha Mahipal, processes and manufactures guar gum powder and its by-products guar korma and guar churi. Its processing unit in Sriganganagar, Rajasthan, has installed capacity of 36 tonnes per day. MD. QUIYAMUDDIN: CRISIL Cuts Rating on INR84MM Cash Loan to D ------------------------------------------------------------- CRISIL has downgraded its ratings on the bank facilities of Md. Quiyamuddin Khan Engineers Private Limited (QKEPL) to 'CRISIL D/CRISIL D' from 'CRISIL B/Stable/CRISIL A4'. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Bank Guarantee 65.3 CRISIL D (Downgraded from 'CRISIL A4') Cash Credit 84 CRISIL D (Downgraded from 'CRISIL B/Stable') Proposed Fund- 15.7 CRISIL D (Downgraded from Based Bank Limits 'CRISIL B/Stable') The downgrade reflects delays by the company in meeting interest obligation, and its overdrawn cash credit limit for more than 30 consecutive days. This was driven by weak liquidity on account of stretched receivables. QKEPL has a small scale and working-capital-intensive operations in the highly fragmented civil construction industry, and customer concentration in its revenue profile. However, the company benefits from the extensive industry experience of its promoters. QKEPL, promoted in August 2010 by Ranchi-based Mr. Manzar Imam Khan and his family members, undertakes civil construction, primarily construction of roads, in Jharkhand and Bihar. MJ AND SONS: CRISIL Ups Rating on INR380MM LT Loan to B- -------------------------------------------------------- CRISIL has upgraded its rating on the long-term bank facilities of MJ and Sons Distilliery and Breweries Private Limited (MJS) to 'CRISIL B-/Stable' from 'CRISIL D'. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Cash Credit 170 CRISIL B-/Stable (Upgraded from 'CRISIL D') Long Term Loan 380 CRISIL B-/Stable (Upgraded from 'CRISIL D') Proposed Long Term 90 CRISIL B-/Stable (Upgraded Bank Loan Facility from 'CRISIL D') The upgrade reflects timely servicing of debt by MJS over the past three months. While MJS's bank line remains fully utilised because of large working capital requirement, CRISIL believes the company's liquidity will continue to be supported by need-based funds from promoter over the medium term. The rating reflects MJS's weak financial risk profile because of stretched liquidity driven by modest cash accrual and sizeable incremental working capital requirement. These weaknesses are partially offset by promoter's funding support and his extensive industry experience. Outlook: Stable CRISIL believes MJS will continue to benefit over the medium term from its promoter's extensive industry experience. The outlook may be revised to 'Positive' in case of substantial and sustained increase in revenue and profitability, or improvement in capital structure driven by equity infusion. Conversely, the outlook may be revised to 'Negative' if a steep decline in profitability, any large debt-funded capital expenditure, or stretch in working capital cycle weakens key credit metrics. MJS was established in October 2005 by Mr. Shiv Kumar to manufacture extra-neutral alcohol and country liquor from food grains. Its plant is in Patna. MODEL EXIMS: Ind-Ra Suspends 'IND BB-' Long-Term Issuer Rating -------------------------------------------------------------- India Ratings and Research (Ind-Ra) has migrated Model Exims' 'IND BB-' Long-Term Issuer Rating to the suspended category. The Outlook was Stable. The rating will now appear as 'IND BB- (suspended)' on the agency's website. The agency has also migrated the company's INR135 million fund based limits to 'IND BB- (suspended)' and IND A4+(suspended) from 'IND BB-' and `INDA4+`. The ratings have been migrated to the suspended category due to lack of adequate information. Ind-Ra will no longer provide ratings or analytical coverage for Model Exims. The ratings will remain in the suspended category for a period of six months and be withdrawn at the end of that period. However, in the event the issuer starts furnishing information during this six-month period, the ratings could be reinstated and will be communicated through a rating action commentary. MOUNT SHIVALIK: CRISIL Cuts Rating on INR100MM Loan to 'D' ---------------------------------------------------------- CRISIL has downgraded its ratings on the bank facilities of Mount Shivalik Industries Limited (MSIL) to 'CRISIL D/CRISIL D' from 'CRISIL B-/Stable/CRISIL A4'. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Bank Guarantee 5 CRISIL D (Downgraded from 'CRISIL A4') Cash Credit 100 CRISIL D (Downgraded from 'CRISIL B-/Stable') Letter of Credit 30 CRISIL D (Downgraded from 'CRISIL A4') Term Loan 62.2 CRISIL D (Downgraded from 'CRISIL B-/Stable') The downgrade reflects a significant deterioration in the business and financial risk profiles. The company reported losses consistently for the five years ended June 30, 2015, resulting in a negative networth. Following this, the Board for Industrial and Financial Reconstruction (BIFR) declared the company sick in October 2015. MSIL further reported losses of INR18 million for the quarter ended September 30, 2015. Sustained losses led to a negative networth of INR200 million as on June 30, 2015. It generated negative cash accruals of over INR 11 million as of June 2015 against estimated debt obligation of around INR4.5 million per quarter in 2015-16 (July to June). CRISIL believes MSIL's liquidity is severely stretched on account of sustained operating losses, along with a negative networth. The ratings continue to reflect MSIL's weak financial risk profile because of negative debt protection metrics and leverage, exposure to regulatory risks and geographical concentration in the revenue profile, and susceptibility to volatility in raw material prices and exposure to intense competition in beer industry. These rating weaknesses are partially offset by the established market position of its thunderbolt brand in the strong-beer segment. Established by Mr. B D Bali in 1995, MSIL manufactures and markets beer. Its facility, located at Behror (Rajasthan), has an installed capacity to produce 400,000 hectolitres of beer per annum. Most of its beer sales are made under the Thunderbolt brand. PATEL INCORPORATION: CRISIL Assigns B+ Rating to INR75MM Loan ------------------------------------------------------------- CRISIL has assigned its 'CRISIL B+/Stable' rating to the long-term bank facility of Patel Incorporation (PI). The rating reflects modest scale of operations and low margins in fragmented industry and below-average financial risk profile marked by high leverage. These weaknesses are mitigated by promoter's extensive experience and prudent working capital management. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Overdraft Facility 75 CRISIL B+/Stable Outlook: Stable CRISIL believes PI will benefit over the medium term from its promoter's extensive experience. The outlook may be revised to 'Positive' if revenue increases significantly, while improving margins and capital structure. Conversely, the outlook may be revised to 'Negative' if financial risk profile weakens because of large external debt for meeting working capital requirement or substantially low cash accrual. Set up in 2006 as a proprietorship firm, PI trades in iron and steel. Kanpur-based PI is promoted by Mr. Ritesh Patel. The firm procures majority of its raw material from Tata Steel Ltd, Steel Authority of India Ltd, and Bhushan Power and Steel Ltd. The firm recorded book profit of INR1.05 million on sales of 293.2 million in 2014-15 as against book profit of INR0.74 million on sales of INR281.3 million in 2013-14. PIONEER STEELS: Ind-Ra Withdraws IND B+ Long-Term Issuer Rating --------------------------------------------------------------- India Ratings and Research (Ind-Ra) has withdrawn Pioneer Steels' Long-Term Issuer Rating of IND B+(suspended). The ratings have been withdrawn due to lack of adequate information. Ind-Ra will no longer provide ratings or analytical coverage for Pioneer Steels. Ind-Ra suspended Pioneer Steels' ratings on 18 June 2015. Pioneer Steels' ratings: -- Long-Term Issuer Rating: 'IND B+(suspended)'; rating withdrawn -- INR11.7 million term loans: 'IND B+(suspended)'; rating withdrawn -- INR200 million fund-based working capital limits: 'IND B+(suspended)'/'IND A4(suspended)'; ratings withdrawn PRINCEMARINE TRANSPORT: CARE Lowers Rating on INR5.5cr Loan to C ---------------------------------------------------------------- CARE revises the lt rating and reaffirms the st rating assigned to the bank facilities of Princemarine Transport Services Private Limited. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long-term Bank Facilities 0.82 CARE D Revised from (Term Loan) CARE B Long-term Bank Facilities 5.50 CARE C Revised from (Fund-based) CARE B Short-term Bank Facilities 3.00 CARE A4 Reaffirmed Rating Rationale The revision in the ratings assigned to the bank facilities of Prince Marine Transport Services Private Limited (PMTS) is on account of delays in servicing of term loan instalment with Oriental Bank of Commerce due to weak liquidity position. The ability of PMTS to establish a clear track record of timely servicing of debt obligations with improvement in liquidity position is the key rating sensitivity. Prince Marine Transport Pvt. Ltd. (PMTS) was founded by Mr Abdul Razak in July 1993 as a proprietary firm. During the year 1994, it was converted into a partnership firm and then in 2007 into a private limited company. The company initially started with the business of hiring ships, vessels, barges, tugs and towage of vessels within Mumbai harbor limits as well as for ocean passages. During 1998, it ventured into the business of cargo lighterage. To capitalize on the opportunity of various services in the developing port sector, the company entered into dredging support services and bagged a dredging contract from JSWJaigarh Port Ltd. in the year 2009. As on February 28, 2015, the company owned 15 barges mainly involved in offshore supply as well as lighterage operations for coal. Out of the 15 barges, nine were deployed on yearly contracts and the remaining deployed on spot. The company also operates a small ship building yard in Goa. R. D. SALES: CRISIL Assigns 'B' Rating to INR40MM LT Loan --------------------------------------------------------- CRISIL has assigned its 'CRISIL B/Stable' rating to the long-term bank facilities of R. D. Sales (RDS). Amount Facilities (INR Mln) Ratings ---------- --------- ------- Proposed Long Term Bank Loan Facility 40 CRISIL B/Stable Cash Credit 40 CRISIL B/Stable Electronic Dealer 40 CRISIL B/Stable Financing Scheme (e-DFS) The rating reflects RDS's small scale of operations in a highly competitive industry, geographical concentration in revenue, and weak financial risk profile. These weaknesses are partially offset by its promoters' extensive experience in the steel trading business and their financial support, and its large working capital requirement. Outlook: Stable CRISIL believes RDS 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 growth and improvement in operating profitability, leading to a better financial risk profile. Conversely, the outlook may be revised to 'Negative' if financial risk profile weakens because of lengthening of working capital cycle, or if operating margin is lower than expected. RDS was set up as a proprietorship concern by Mr. Anil Bansal in 2007 and is based in Delhi. It was reconstituted as a partnership firm in 2012. The firm trades in steel and is an authorised dealer of Steel Authority of India Ltd for north Delhi. In 2014-15 (refers to financial year, April 1 to March 31), RDS's book profit was INR1.1 million on net sales of INR527 million, against book profit of INR1.3 million on net sales of INR370 million for 2013-14. RAILONE PROJECTS: Ind-Ra Suspends 'IND BB-' LT Issuer Rating ------------------------------------------------------------ India Ratings and Research (Ind-Ra) has suspended Railone Projects Private Ltd's (Railone) 'IND BB-' Long-Term Issuer Rating. The Outlook was Negative .The rating will now appear as 'IND BB- (suspended)' on the agency's website. The ratings have been migrated to the suspended category due to lack of adequate information. Ind-Ra will no longer provide ratings or analytical coverage for Railone. The ratings will remain in the suspended category for a period of six months and be withdrawn at the end of that period. However, in the event the issuer starts furnishing information during the six- month period, the ratings could be reinstated and will be communicated through a rating action commentary. Railone's ratings are as follows: -- Long-Term Issuer Rating: migrated to 'IND BB-(suspended)' from 'IND BB-'/Negative -- INR195 million fund-based working capital limits: migrated to 'IND BB-(suspended)' and 'IND A4+(suspended)' from 'IND BB-' and 'IND A4+ ' -- INR575 million non-fund-based working capital limits: migrated to 'IND BB-(suspended)' and 'IND A4+(suspended)' from 'IND BB-' and 'IND A4+' RAJ ISPAT: CARE Assigns 'B+' Rating to INR7cr LT Loan ----------------------------------------------------- CARE assigns 'CARE B+' rating to the bank facilities of Raj Ispat Udyog. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long term Bank Facilities 7 CARE B+ Assigned Rating Rationale The rating assigned to the bank facilities of Raj Ispat Udyog (RIU) is constrained by the entity's small and declining scale of operations, weak solvency position, and working capital intensive nature of operations. The rating is further constrained by highly fragmented & competitive nature of the steel trading segment and constitution of the entity being a partnership concern. The rating, however, derives strength from the experienced promoters with long track record of operations and moderate PBILDT margins. Going forward, the ability of the entity to profitably scale up its operations, improve the overall solvency position and manage the working capital requirements efficiently will remain the key rating sensitivities. Established in 1988, Raj Ispat Udyog (RIU) is a Ludhiana-based (Punjab), partnership concern engaged in the trading of steel products including CR coils, HR sheet, straight angles, channel and joints, etc. The traded goods are procured from an associate concern, Raj Steel Industries (RSI) [rated 'CARE B+'] and sold to various dealers and wholesalers in Punjab, Chandigarh and J&K (Jammu and Kashmir). RSI, was established in 1984, which is engaged in manufacturing and trading of steel items. In FY15 (as per the unaudited results; refers to the period April 1 to March 31), RIU had achieved total operating income of INR26.84 crore with PAT of INR0.11 crore compared to total operating income of INR27.66 crore and PAT of INR0.03 crore in FY14. In 6MFY16 (Provisional), the firm has achieved total operating income of INR29.42 crore. RAJ STEEL: CARE Assigns B+ Rating to INR5cr LT Loan --------------------------------------------------- CARE assigns 'CARE B+' rating to the bank facilities of Raj Steel Industries. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long term Bank Facilities 5 CARE B+ Assigned Rating Rationale The rating assigned to the bank facilities of Raj Steel Industries (RSI) is constrained by the entity's small and fluctuating scale of operations, working capital intensive nature of operations and leveraged capital structure. The rating is further constrained by susceptibility of profitability margins to raw material price fluctuations, presence of the firm in a highly fragmented & competitive industry and constitution of the entity being a partnership concern. The rating, however, derives strength from the experienced promoters and long track record of operations of the firm for more than three decades. Going forward, the ability of the entity to profitably scale up its operations, improve the overall solvency position and manage the working capital requirements efficiently will remain the key rating sensitivities. Established in 1984, Raj Steel Industries (RSI) is a partnership entity engaged in the manufacturing and trading of steel products with its manufacturing facility located at Ludhiana, Punjab. The finished products include H.R Shuttering, H.R pipe, steel box etc. The raw material, majorly steel is procured from reputed suppliers as Steel Authority of India Limited (SAIL) [Rourkela Steel and Bokaro Steel Plant], Punjab State Small Industries and Export Corporation (PPSIEC). The finished goods are sold to dealers and wholesalers in Punjab, Chandigarh and J&K (Jammu and Kashmir).RSI has another group concern viz. Raj Ispat Udyog (RIU; rated 'CARE B+'), established in 1988, which is engaged in trading of steel items. In FY15 (as per the unaudited results; refers to the period April 1 to March 31), RSI had achieved total operating income of INR29.82 crore with PAT of Rs1.76 crore compared to total operating income of INR26.47 crore and PAT of INR0.21 crore in FY14. In 6MFY16 (Provisional), RSI has achieved a total operating income of INR18.50 crore. RAJENDRA KUMAR: Ind-Ra Affirms 'IND BB' Long-Term Issuer Rating --------------------------------------------------------------- India Ratings and Research (Ind-Ra) has affirmed Rajendra Kumar Kalal's (Rajendra) Long-Term Issuer Rating at 'IND BB'. The Outlook is Stable. KEY RATING DRIVERS The ratings continue to reflect Rajendra's moderate scale of operations, with revenue of INR836 million in FY15 (FY14: INR952 million). The ratings are constrained by its weak order book size of around INR394 million (unexecuted value) at end-December 2015 and the proprietorship nature of the organisation. Also, liquidity is tight, as reflected in the company's around 99% working capital utilisation over the six months ended January 2016. The ratings benefit from Rajendra's strong credit metrics, with interest coverage (operating EBITDAR/gross interest expense) of 5.3x in FY15 (FY14: 7.2x) and leverage (total adjusted net debt/operating EBITDAR) of 1.4x (0.8x) due to its comfortable EBITDA margin of 6.8% (5.9%). The ratings are also supported by the proprietor's two-decade-long experience in the construction business. RATING SENSITIVITIES Positive: An improvement in the scale of operations, while maintaining the credit metrics, will be positive for the ratings. Negative: Any deterioration in the credit metrics will be negative for the ratings. COMPANY PROFILE Rajendra executes civil contracts in Rajasthan. It mainly executes orders issued by the Public Works Department, which is a state- level enterprise. Rajendra operates in several locations across Rajasthan, such as Udaipur, Dungarpur and Pratapgarh. Rajendra's ratings: -- Long-Term Issuer Rating: affirmed at 'IND BB'; Outlook Stable -- INR25 million fund-based working capital limits: affirmed at 'IND BB'/Stable -- INR95 million non-fund-based working capital limits: affirmed at 'IND A4+' -- INR25 million proposed fund-based working capital limits: assigned 'Provisional IND BB'/Stable RAJINDER & CO.: Ind-Ra Suspends 'IND B+' LT Issuer Rating --------------------------------------------------------- India Ratings and Research (Ind-Ra) has migrated M/S Rajinder & Co.'s (RAC) 'IND B+' Long-Term Issuer Rating to the suspended category. The Outlook was Stable. This rating will now appear as 'IND B+(suspended)' on the agency's website. A full list of rating actions is at the end of this commentary. The ratings have been migrated to the suspended category due to lack of adequate information. Ind-Ra will no longer provide ratings or analytical coverage of RAC. The ratings will remain in the suspended category for a period of six months and be withdrawn at the end of that period. However, in the event the issuer starts furnishing information during this six-month period, the ratings could be reinstated and will be communicated through a rating action commentary. RAC's ratings: -- Long-Term Issuer Rating: migrated to 'IND B+(suspended)' from 'IND B+'/Stable -- INR50 million fund-based limits: migrated to 'IND B+(suspended)'/'IND A4 (suspended)' from 'IND B+'/'IND A4' -- INR150 million non-fund-based limits: migrated to 'IND B+(suspended)'/'IND A4(suspended)' from 'IND B+'/'IND A4' ROYAL PLAZA: CRISIL Assigns 'D' Rating to INR100MM Term Loan ------------------------------------------------------------ CRISIL has assigned its 'CRISIL D' rating to the long-term bank facility of Royal Plaza Inn (RPI). Amount Facilities (INR Mln) Ratings ---------- --------- ------- Term Loan 100 CRISIL D The rating reflects instances of delays by RPI in servicing its term debt obligations owing to weak liquidity following the delay in project completion. The rating also factors in the risks related to the implementation of its ongoing project. These weaknesses are mitigated by the entrepreneurial experience of the proprietor. RPI, a sole proprietorship entity set up in 2010 by Mr. M P Shamsudheen, is currently constructing a 108 room hotel in Arayidathupalam, Kozhikode. S. E. ENTERPRISES: CRISIL Assigns B Rating to INR50MM Cash Loan --------------------------------------------------------------- CRISIL has assigned its 'CRISIL B/Stable' rating to the long-term bank facilities of S. E. Enterprises Private Limited (SEPL). Amount Facilities (INR Mln) Ratings ---------- --------- ------- Cash Credit 50 CRISIL B/Stable Proposed Long Term Bank Loan Facility 10 CRISIL B/Stable The rating reflects SEPL's weak financial risk profile because of muted debt protection metrics and high total outside liabilities to tangible networth ratio, and its small scale of operations in the fragmented textile trading industry. These weaknesses are mitigated by the promoters' extensive experience in the textile industry. Outlook: Stable CRISIL believes SEPL to maintain its business risk profile backed by its promoters' experience. The outlook may be revised to 'Positive' in case of a substantial increase in sales, leading to sizeable cash accrual, or if the company's capital structure improves due to equity infusion, along with prudent working capital management. Conversely, the outlook may be revised to 'Negative' if financial risk profile weakens due to decline in revenues and profitability or if a large, debt-funded capital expenditure is undertaken, or if liquidity weakens significantly owing to increase in working capital requirement. SEPL was established in 1992 by the Kapoor family. The company is into the trading and wholesaling of Raymond Suitings through its showroom in Bareilly (Uttar Pradesh). The company is managed by Mr. Suresh Kapoor and his family. On provisional basis, SEPL reported a profit after tax (PAT) of INR0.7 million on net sales of INR134.8 million for 2014-15 (refers to financial year, April 1 to March 31), vis-a-vis net loss of INR0.02 million on net sales of INR132.2 million for 2013- 14. SACHDEVA RICE: CRISIL Cuts Rating on INR100MM Loan to B- -------------------------------------------------------- CRISIL has downgraded its rating on the long-term bank facilities of Sachdeva Rice and General Mills (SRGM) to 'CRISIL B-/Stable' from 'CRISIL B/Stable'. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Cash Credit 100 CRISIL B-/Stable (Downgraded from 'CRISIL B/Stable') Warehouse Receipts 80 CRISIL B-/Stable (Downgraded from 'CRISIL B/Stable') The downgrade reflects the firm's stretched liquidity and subdued profitability on account of substantial build-up of inventory. Consequently, its dependence on bank borrowing has increased significantly as reflected in almost full utilisation of its fund- based working capital limit. This is expected to further weaken the firm's financial risk profile. CRISIL believes liquidity will depend on the extent of liquidation of inventory and the level of realisation from this, over the medium term. The rating reflects SRGM's weak financial risk profile because of a small net worth and high gearing, and a small scale of operations in the highly fragmented and working capital-intensive rice industry. These rating weaknesses are partially offset by the extensive industry experience of the firm's partners. Outlook: Stable CRISIL believes SRGM will continue to benefit over the medium term from its partners' extensive industry experience. The outlook may be revised to 'Positive' if the firm improves its capital structure, most likely because of large net cash accrual, significant infusion of capital, or improvement in working capital cycle. Conversely, the outlook may be revised to 'Negative' in case of any aggressive debt-funded expansions, or a substantial decline in revenue and profitability, or a stretched working capital cycle, resulting in deterioration in the financial risk profile. SRGM was set up in 2008 by Mr. Sachit Sachdeva and his family. It is a partnership firm based in Fazilka, Punjab. The firm processes paddy into basmati rice; it has a processing capacity of 6 tonnes per hour. In 2014-15 (refers to financial year, April 1 to March 31), SRGM had a book profit of INR2.4 million on net sales of INR292.5 million, against a book profit of INR1.9 million on net sales of INR355.7 million in the previous year. SAHANU SPONGE: CARE Reaffirms B+ Rating on INR12.30cr LT Loan ------------------------------------------------------------- CARE reaffirmes ratings to bank the facilities of Sahanu Sponge & Power Limited. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long term Bank Facilities 12.30 CARE B+ Reaffirmed Short term Bank Facilities 0.30 CARE A4 Reaffirmed Rating Rationale The ratings assigned to the bank facilities of Sahanu Sponge & Power Limited (SSPL) continue to remain constrained due to the limited track record of its operations in the highly competitive and fragmented steel bars segment, stressed financial profile characterized by highly leveraged capital structure and stressed debt coverage indicators, working capital intensive nature of operations, cyclical nature of the steel sector and exposure to volatile raw material prices. The ratings, however, continue to take into account the long experience of the promoters in the steel sector through association with Ambey Metallic Limited, Jay Ambey Iron Private Limited, Goa Ispat Limited, HariPriya Corporation and Hari Priya Steel Industries, operating in same business line, which are coupled with moderate capacity utilization of SSPL, strong growth in revenue along with improvement in the operational performance and its diversified customer base. Ability of the company to improve capital structure, utilize the installed capacity optimally and manage volatility in raw material prices are the key rating sensitivity. Goa-based, SSPL was incorporated in June, 2003 for the manufacturing of TMT (Thermo Mechanical Treatment) bars. The company remained dormant upto May 2012 and in June 2012acquired the production facilities of 'Srithik Rolling Private Limited' which was based out of Goa. SSPL restarted commercial production of TMT bars, under the new management team comprising of Mr Sunil Garg, Mr Pawan Bansal and Mr Tushar Garg who are the Directors of the company. SSPL manufactures Steel TMT bars of various specifications and markets the same as "GOA GOLD TMT". SSPL's facilities, which commenced operations from July 2012, are ISO certified and have an annual capacity of 45,000 Metric Tonnes Per Annum(MTPA). SHANKAR FLOUR: Ind-Ra Suspends 'IND B-' Long-Term Issuer Rating -------------------------------------------------------------- India Ratings and Research (Ind-Ra) has migrated Shankar Flour Mill's (SFM) 'IND B-' Long-Term Issuer Rating with a Stable Outlook to the suspended category. The rating will now appear as 'IND B- (suspended)' on the agency's website. The ratings have been migrated to the suspended category due to lack of adequate information. Ind-Ra will no longer provide ratings or analytical coverage for SFM. The ratings will remain in the suspended category for a period of six months and be withdrawn at the end of that period. However, in the event the issuer starts furnishing information during the six- month period, the ratings could be reinstated and will be communicated through a rating action commentary. SFM's ratings are as follows: -- Long-Term Issuer Rating: migrated to 'IND B-(suspended)' from 'IND B-'/ Stable -- INR36 million fund based limits: migrated to 'IND B- (suspended)' from 'IND B-' -- INR14 million long-term loans: migrated to 'IND B- (suspended)' from 'IND B-' SHUBH ALUMINIUM: CARE Assigns 'B/A4' Rating to INR14cr Loan ----------------------------------------------------------- CARE assigns 'CARE B' and 'CARE A4' ratings to the bank facilities of Shubh Aluminium Private Limited. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long-term/Short-term 14.00 CARE B/CARE A4 Bank Facilities Assigned Rating Rationale The ratings assigned to the bank facilities of Shubh Aluminum Private Limited (SAPL) are primarily constrained on account of its nascent stage of operations along with its presence in a highly competitive and fragmented trading industry and susceptibility of the company's profitability to fluctuations in the raw material prices. The ratings, however, derives strength from the long standing experience of the promoters in the diversified line of business. SAPL's ability to stabilize the operations of newly setup business with achievement of the envisaged levels of income and profitability shall be the key rating sensitivities. Udaipur-based (Rajasthan) SAPL was incorporated in 2012 by 'Motawat family' along with Mr Ashok Agarwal. SAPL has commenced its commercial operation from September, 2015 onwards and is primarily engaged in trading of Iron & Steel, Polyester Yarn and PET bottles. SMPL mainly caters to the domestics market with sales concentrated predominantly in Rajasthan, Gujarat and Delhi to various processing and end user manufacturing units pertaining to the industry. The company procures iron and steel mainly form dealers located in Jaipur as well as directly through SAIL (Steel Authority of India) while its procures polyester from Del Cadre Agents of Reliance Industries Limited and PET bottles from all over Rajasthan. SINGH CYCLE: CRISIL Assigns B+ Rating to INR100MM Loan ------------------------------------------------------ CRISIL has assigned its 'CRISIL B+/Stable' rating to the bank facilities of Singh Cycle And Motor Co. Private Limited (SCMCPL). Amount Facilities (INR Mln) Ratings ---------- --------- ------- Inventory Funding Facility 100 CRISIL B+/Stable Cash Credit 10 CRISIL B+/Stable Drop Line Overdraft Facility 50 CRISIL B+/Stable The rating reflects SCMCPL's initial phase and expected modest scale of operations in the intensely competitive automobile dealership business in Pune, and average financial risk profile, marked by modest networth and leveraged capital structure, driven by debt-funded capital expenditure and working capital requirements. These rating weaknesses are partially offset by the promoters' extensive experience in the automobile dealership business and its association with Hyundai Motors India Ltd (HMIL; rated 'CRISIL A1+'), one of the prominent players in the Indian passenger car industry. Outlook: Stable CRISIL believes SCMCPL will continue to benefit over the medium term from its promoters' extensive experience and its association with HMIL. The outlook may be revised to 'Positive' if substantial ramp-up in sales and profitability leads to sizeable cash accruals in the initial phase. Conversely, the outlook may be revised to 'Negative' if the financial risk profile, particularly liquidity, weakens because of lower ramp-up in sales, decline in cash accrual, sizable working capital requirements, or a large debt- funded capital expenditure. SCMCPL, incorporated in 2012-13 by Mr. K S Bedi and family, is the authorised dealer for HMIL's passenger cars in Pune. The company commenced its operations in January 2016 and currently operates one showroom and two workshops in Pune. SREE KOPPAMMAL: CRISIL Reaffirms 'D' Rating on INR110MM Loan ------------------------------------------------------------ CRISIL's ratings on the bank facilities of Sree Koppammal Cotton Spinning Mills Private Limited (SKCSMPL) continue to reflect instances of delay by SKCSMPL in servicing its term debt because of stretched liquidity and working capital intensity in operations. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Cash Credit 110 CRISIL D (Reaffirmed) Letter of Credit 40 CRISIL D (Reaffirmed) Proposed Long Term Bank Loan Facility 14.7 CRISIL D (Reaffirmed) Rupee Term Loan 15.3 CRISIL D (Reaffirmed) The rating also reflects SKCSMPL's small scale of operations in the intensely competitive cotton spinning industry and below- average financial risk profile marked by high gearing and moderate debt protection metrics. These rating weaknesses are partially offset by the promoters' extensive experience in the textile industry. SKCSMPL, based in Aruppukottai, Tamil Nadu, was incorporated in 1995. It manufactures cotton yarn and polyester - and viscose- blended yarn. Its operations are managed by key promoters, Mr. T R S Babu and Mr. T R S Karthikeyan. SKCSMPL reported profit after tax (PAT) of INR0.5 million on total revenues of INR617.5 million in 2014-15 (refers to financial year, April 1 to March 31) against PAT of INR0.4 million on total revenues of INR545.8 million for 2013-14. SUNLEX FABRICS: CARE Ups Rating on INR7.69cr Loan to 'BB-' ---------------------------------------------------------- CARE revises the lt rating and reaffirms the st rating assigned to the bank facilities of Sunlex Fabrics Private Limited. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long-term Bank Facilities 7.69 CARE BB- Revised from CARE B Long-term/Short-term Bank 12.00 CARE BB-/CARE A4 Facilities Long-term rating revised from CARE B and Shortterm rating reaffirmed Rating Rationale The revision in the long-term rating assigned to the bank facilities of Sunlex Fabrics Private Limited (SFPL) was primarily on account of healthy growth in its scale of operations during FY15 (refers to the period April 1 to March 31) along with improvement in debt coverage indicators. The ratings continue to draw strength from the long industrial experience of the promoters. The ratings, however, continue to remain constrained on account of moderate profit margins, moderately leveraged capital structure, moderate debt coverage indicators and liquidity position along with susceptibility of its profit margins to the fluctuation in foreign exchange rates and raw material prices. The ability of SFPL to increase its scale of operations and improve profitability through mitigating raw material and foreign exchange fluctuation risks along with an improvement in the overall financial risk profile via efficient liquidity management are the key rating sensitivities. Morbi-based (Gujarat) SFPL was incorporated in 2011 by "Detroja" family to undertake the manufacturing of flex banner and its allied products. SFPL recently started its commercial production from September 2013 onwards with an installed capacity of 12,000 metric tonne per annum (MTPA). The promoter family is also engaged in tiles manufacturing business through other entities. Products manufactured by SFPL are used as a medium of advertisement in the form of billboards, banners, exhibition booth decoration etc. after digitally printing the same. During FY15, SFPL reported a total operating income (TOI) of INR72.14 crore with a PAT of INR1.02 crore as against TOI of INR15.56 crore with a net loss of INR0.65 crore for its seven months of operations during FY14. During 9MFY16 (Provisional), SFPL reported TOI of INR75.55 crore. SWASTIK OIL: CARE Assigns 'B' Rating to INR87.1cr LT Loan --------------------------------------------------------- CARE assigns 'CARE B' and 'CARE A4' ratings to bank facilities of Swastik Oil Refinery Pvt. Ltd. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long-term Bank Facilities 87.1 CARE B Assigned Short-term Bank Facilities 17.9 CARE A4 Assigned Rating Rationale The ratings assigned to the bank facilities of Swastik Oil Refinery Pvt Ltd (SORPL) are constrained by significant losses in the last three years due to volatile raw material price as well as forex fluctuation leading to tight liquidity position, low operating margin inherent in the nature of business, moderate capacity utilisation and fragmented nature of the industry with presence of unorganized players. The above constraints are partially offset by the experience of the promoter and satisfactory presence in East and North-East India. The ability to turnaround the business and earn profit as envisaged in the wake of volatile raw material prices would remain the key rating sensitivity. SORPL incorporated in April 1997 as Swastik Refinery Pvt Ltd, is engaged in manufacturing of various edible oils (refined palm and rice bran) and Vanaspati ghee. Subsequently in December 2015 the name of the company was changed to its present name SORPL. The company is promoted by Kolkata-basedMr. O.P. Agarwal, his sonMr. Manoj Agarwal and his nephew Mr. Ashok Agarwal. The company has a total installed capacity of 20,000 tonnes per annum (TPA) for vanaspati and 70,000 TPA for refined oil at its manufacturing facilities located in Howrah (West Bengal). The company has presence mainly in the East & North East India. SORPL internally consumes 80% of the produce i.e. Refined Palm Oil in its other divisions like Vanaspati and Rice Bran Oil. Remaining 20% of the Refined Palm Oil is sold to the outside market. SORPL's board of directors comprise of two directors both from promoters family. The day-to-day affairs of the company are looked after by Mr. Ashok Agarwal. In FY15 (refers to the period April 1 to March 31), SORPL net loss of INR14.07 crore (loss of INR12.40 crore in FY14) on operating income of INR206.96 crore (Rs.290.08 crore in FY14). UTTORAYON TEA: CRISIL Reaffirms B Rating on INR57.5MM Term Loan --------------------------------------------------------------- CRISIL ratings on bank facilities of Uttorayon Tea Industries Private Limited (UTIPL) continues to reflect UTIPL's modest scale of operations and financial risk profile marked by modest net worth, high gearing and average debt protection metrics. These rating weakness are partially offset by UTIPL's promoter's extensive industry experience in the tea industry. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Bank Guarantee 2 CRISIL A4 (Reaffirmed) Cash Credit 24.5 CRISIL B/Stable (Reaffirmed) Proposed Long Term 2 CRISIL B/Stable (Reaffirmed) Bank Loan Facility Rupee Term Loan 57.5 CRISIL B/Stable (Reaffirmed) Outlook: Stable CRISIL believes that UTIPL will continue to benefit from its promoters' extensive experience in the tea industry. The outlook may be revised to 'Positive' if the company generates more-than- expected revenues while maintaining its profitability, leading to improvement in its financial risk profile. Conversely, the outlook may be revised to 'Negative' if UTIPL's business and financial risk profiles weaken, most likely because of lower-than-expected profitability or a stretch in its working capital cycle. UTIPL was incorporated in July 2012 in Siliguri. It manufactures black CTC tea. VANTAGE SPINNERS: CARE Reaffirms 'B+' Rating on INR68.75cr Loan --------------------------------------------------------------- CARE reaffirms the rating assigned to bank facilities of Vantage Spinners Private Limited. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long term Bank Facilities 68.75 CARE B+ Reaffirmed Rating Rationale The rating assigned to the bank facilities of Vantage Spinners Private Limited (VSPL) continues to be constrained by high inventory holding period, decline in the PBILDT margin, deterioration of capital structure, susceptibility of margins to volatility in raw cotton prices and limited track record of the company in the industry. However, the rating is underpinned by geographical advantage for raw material availability, growth in the total operating income in FY15 (refers to the period April 01 to March 31) with improvement in liquidity profile and stable outlook for the cotton yarn industry. The ability of the company to further increase the scale of operations with improvement in profitability and liquidity are the key rating sensitivities. VSPL was incorporated on July 28, 2006, by Mr Potluri Mohana Murali Krishna, Mr Potluri Soma Sekhar and Ms Nandamuri Meenalatha. The promoters inducted Mr J. S. Prasad Reddy as the chairman of VSPL in 2010. He has over 26 years of experience of working in a spinning mill. VSPL is mainly into manufacturing of cotton yarn (40s and 60s count) with an installed capacity of 31,500 spindles. The company's manufacturing plant is located at Nuzividu Mandalam in Krishna district, Andhra Pradesh. The company started commercial operation in February 2010. In January 2015, VSPL added three open-ended spinning machines with annual installed capacity of 4,641 metric tones (MT) to manufacture cotton yarn of 10s/12s/16s count size. Currently, VSPL's capacity utilisation has remained around 94%-96% of installed capacity of 31,500 spindles and 2,688 rotors (Open Ended machines). For FY15 (Audited), VSPL reported PBILDT of INR14.86 crore and PAT of INR1.21 crore on total operating income of INR98.61 as against PBILDT of INR15.23 crore and PAT of INR1.08 crore on total operating income of INR80.47 crore. VARSHA SUPER: CRISIL Assigns B+ Rating to INR67.5MM Cash Loan ------------------------------------------------------------- CRISIL has assigned its 'CRISIL B+/Stable' rating to the long term bank facilities of Varsha Super Stockist India Private Limited (VSS). Amount Facilities (INR Mln) Ratings ---------- --------- ------- Cash Credit 67.5 CRISIL B+/Stable Proposed Long Term 7.5 CRISIL B+/Stable Bank Loan Facility The rating reflects VSS's below-average financial risk profile marked by high total outside liabilities to total net worth along with limited geographical diversity in its revenue profile. These rating weaknesses are mitigated by its promoters' extensive experience in the consumer durable distributorship business and VSS's established relationship with its principal Samsung India Electronics Pvt Ltd. Outlook: Stable CRISIL believes that VSS will benefit from its promoters' long- standing presence in the distribution industry and established presence. The outlook may be revised to 'Positive' if VSS reports more-than-expected growth in revenues and profitability, leading to improvement in its financial risk profile, led by increase in cash accruals. Conversely, the outlook may be revised to 'Negative' if VSS's financial risk profile deteriorates, due to a stretch in the working capital cycle or lower-than-expected profitability. Established as a proprietorship firm in 1993 and later reconstituted into a private limited company, VSS is the sole regional distributor for Samsung Mobile Phones in Trivandrum and also the sole regional distributor for Samsung Home Appliances for Trivandrum and Kollam District. It is also a distributor of M/s MVJ Foods India Pvt Ltd and V-Guard Industries. Based in Trivandrum (Kerala), the company is promoted by Mr. T.G. Thampy. VINAY WIRES: Ind-Ra Affirms 'IND BB' Long-Term Issuer Rating ------------------------------------------------------------ India Ratings and Research (Ind-Ra) has affirmed Vinay Wires & Poly Products Private Limited's (VWPPPL) Long-Term Issuer Rating at 'IND BB'. The Outlook is Stable. KEY RATING DRIVERS The ratings continue to reflect VWPPPL's moderate scale of operations with its net revenue of INR1,098 million in FY15 (FY14: INR1,160 million) as well as its presence in a highly fragmented and competitive industry. The ratings are constrained by VWPPPL's weak credit profile with net financial leverage (total adjusted net debt/operating EBITDAR) of 5.73x in FY15 (FY14: 4.16x) and gross interest coverage (operating EBITDA/gross interest expense) of 1.26x (1.30x). The ratings are also constrained by its tight liquidity position, with the average maximum utilisation of the working capital limits being 103.67% in the 12 months ended January 2016. However, the ratings also reflect the improvement in VWPPPL's operating EBITDA margins to 4.28% in FY15 (FY14: 3.49%) due to a reduction in raw material prices, the two-decade-long experience of its directors in the industry, and the company's strong relationships with its customers and suppliers. The ratings also factor in the low customer concentration risk, evidenced by its top 10 customers contributing 36% to the total sales in FY15. Ind-Ra expects an improvement in its credit metrics in FYE16. RATING SENSITIVITIES Negative: A further decline in revenue growth, along with deterioration in VWPPPL's liquidity position, will be negative for the ratings. Positive: A significant improvement in the revenue, along with improvement in its liquidity and overall credit profile, will be positive for the ratings. COMPANY PROFILE Incorporated in 1999, VWPPPL manufactures cast polypropylene film, blister film, opaque film, blister pack film, metalised cast polypropylene film (an intermediate product used as packaging material for FMCG products), blister packaging film, electric resistance welded steel pipes, black electric resistance welded pipes, pipe fittings, steel scraps and billets. VWPPPL's ratings: -- Long-Term Issuer Rating: affirmed at 'IND BB'; Outlook Stable -- INR100 million fund-based working capital limits: affirmed at 'IND BB'/Stable and 'IND A4+' -- INR140 million non-fund-based limits: affirmed at 'IND A4+' WESTERN INDIA: CARE Assigns B+ Rating to INR8.24cr LT Loan ---------------------------------------------------------- CARE assigns 'CARE B+' rating to the bank facilities of Western India Sea Brines Private Limited. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long-term Bank Facilities 8.24 CARE B+ Assigned Rating Rationale The rating assigned to the bank facilities of Western India Sea Brines Private Limited (WISBPL) is primarily constrained on account of its small scale of operation coupled with net loss reported in last three years ended FY15 (refers to the period April 1 to March 31), leveraged capital structure, weak debt coverage indicators and working capital intensive nature of business. The rating also factors in the presence in a salt business which is highly susceptible to adverse weather conditions and instance of any natural calamities. The rating, however, derives comfort from the experienced promoters as well as established business operation coupled with the presence of well-known customer base and location advantage. Going forward, ability of WISBPL to increase its scale of operations, improvement in profit margins and better working capital management remains the key sensitivities. Furthermore, improvement in capital structure and debt coverage indicators would also remain crucial. Kutch-based (Gujarat) WISBPL was incorporated in March 21, 1995 as a private limited company by Mr Jawerilal G Nahata and other promoters. WISBPL is engaged into the business of refining of salt. WISBPL has also installed 1 windmill with aggregate power generation capacity of 1.50 MW (MegaWatt) as on March 31, 2015. WISBPL has been accredited ISO 9001: 2008 (for quality standard). WISBPL has other group companies namely Chirai Salt (India) Pvt Ltd (engaged in trading of salt), Pharmanza India Pvt. Ltd. (engaged in manufacturing of human and veterinarian allopathic and ayurvedic products), Shree Krishna Salt Industries (engaged in manufacturing and exporting of industrial and refined salt), Shiv Group of Hotels (engaged in hotel business in Kutch and Rajkot district) and Atlas Cable Industries (engaged in cable manufacturing business). During FY15, WISBPL reported net loss of INR0.81 crore on a TOI of INR30.02 crore as against net loss of INR0.95 crore on a TOI of INR30.04 crore during FY14. During H1FY16 (Provisional), WISBPL has achieved a TOI of INR16 crore. ================= I N D O N E S I A ================= ENERGI MEGA: S&P Lowers LT CCR to 'B-'; Outlook Negative -------------------------------------------------------- Standard & Poor's Ratings Services said that it had lowered its long-term corporate credit rating on Indonesia-based oil and gas producer PT Energi Mega Persada Tbk. (EMP) to 'B-' from 'B'. The outlook is negative. At the same time, S&P also lowered its long- term ASEAN regional scale rating on EMP to 'axB-' from 'axB+'. "We lowered the rating because PT Energi Mega continues to face refinancing risks because of its sizable short-term debt at the holding company level," said Standard & Poor's credit analyst Yuehao Wu. "We anticipate that EMP's cash and internal accruals will be insufficient for the debt servicing and the company will rely on rolling over its short-term debt." S&P estimates that EMP has about US$86 million in short-term debt maturing over the next 12 months at the holding company. This compares with S&P's estimate that the holding company has a cash balance of less than US$10 million as of Sept. 30, 2015. In December 2015, EMP refinanced about US$53 million of high-cost debt at its Bentu gas block with a lower cost US$60 million bank loan maturing in December 2020. The company's operating cash flows and dividends from equity stakes in various oil and gas producing blocks, which S&P estimates at US$25 million-US$30 million for the next 12 months, will be insufficient to repay the remaining short-term debt without current maturities being rolled over. S&P notes that EMP has managed to roll over maturing debts several times over the past 18 months, in particular its high-cost loan from PST Finance Ltd. Nevertheless, S&P is unsure whether the company will remain able to do so in tougher market conditions. The current poor industry and pricing conditions for hydrocarbons narrow EMP's refinancing options, in S&P's view. Asset disposals could alleviate refinancing risk on maturing debts. Still, S&P believes this process could be lengthy and the proceeds uncertain, especially for non-producing blocks that have additional capital spending requirements. Refinancing short-term maturities with longer term loans could also be difficult at a reasonable cost over the next six to 12 months, given the reduced investor appetite for oil and gas exposure. S&P believes refinancing though resource-based lending will also have more stringent covenants attached. Moreover, S&P estimates that blocks contributing more than 85% of EMP's production are already encumbered. This leaves limited scope for meaningful additional secured debt. "The government extension of EMP's concession on its Offshore North West Java block is positive from a liquidity standpoint because it postpones the maturity of a collateralized loan on the block to December 2020," said Ms. Wu. Nevertheless, EMP's effective interest in the block decreased to 12.2% from 18.7%. This reduction in interest will narrow the company's asset base, reserve profile, and increase its dependency on its other assets. The company acquired the block in 2011 and its concession was to originally mature in 2017. EMP's other producing blocks will also likely require growing capital spending to maintain or increase production over the next two years, most notably at the Kangean block. The negative outlook on EMP reflects S&P's view that the company's refinancing risk will persist over the next 12 months. S&P could lower the rating if EMP faces difficulty in refinancing or rolling over its maturing short-term debts over the next six months. S&P may revise the outlook to stable if EMP addresses its refinancing risk, resulting in a lengthened debt maturity profile at a reasonable cost. An outlook revision also depends upon the company maintaining funds from operations cash interest coverage well above 1.5x based on the equity-accounting method. ===================== P H I L I P P I N E S ===================== LBC DEVELOPMENT: Garnishment Order on Unit's Accounts Lifted ------------------------------------------------------------ Daphne J. Magturo at BusinesWorld Online reports that a regional trial court (RTC) ordered the lifting of the garnishment of LBC Express Holdings, Inc.'s bank accounts, after the company posted a counter-bond following a PHP1.8-billion collection case filed by the Philippine Deposit Insurance Corp. (PDIC) on behalf of the shuttered LBC Development Bank, Inc. "LBC Express Holdings, Inc., has been advised of the issuance by the regional trial court of an order dated 17 February 2016 in relation to Civil Case No. 15-1258 to lift and set aside the writ of preliminary attachment issued on 7 December 2015 and the garnishment made pursuant thereto," the listed firm told the Philippine Stock Exchange on Feb. 22. A writ of attachment is a court order for the attachment or seizure of a property, and is generally used to freeze the assets of a defendant while awaiting the results of a legal action to satisfy the plaintiff's claim and costs of suit, BusinessWorld says. "The order to lift and set aside the preliminary attachment directs the sheriff of the court to deliver to the defendants all properties previously garnished pursuant to the writ of preliminary attachment," the disclosure, as cited by BusinessWorld, read. "The counter-bond delivered by the defendants shall stand in place of the properties so released and shall serve as security to satisfy any final judgment in the case." According to BusinessWorld, the sheriff of Makati City RTC Branch 143 served the lifting of garnishment on the main offices of Land Bank of the Philippines, BDO Unibank, Inc., Metropolitan Bank and Trust Co., Bank of the Philippine Islands, Rizal Commercial Banking Corp., and Philippine National Bank. BusinessWorld relates that LBC Express Holdings, Inc. Chairman, President and Chief Executive Officer Miguel Angel A. Camahort said last month the group expects "administrative and operational challenges" due to the garnishment of bank accounts. The PDIC is pursuing action against the holding company as the former liquidates the failed LBC Development Bank. PDIC, claiming that it is owed PHP1.8 billion in service fees, won a garnishment order for PHP6.94 million against its bank accounts as well as the attachment of 1.21 billion LBC Express shares registered under the name of LBC Development Corp. Shares in LBC Express Holdings recovered 19 centavos or 2.24% to end Feb. 22's trading at PHP8.69 apiece. BusinessWorld notes that the defendants in the case include LBC Development Corp. and LBC Express, Inc. -- the listed firm's parent and subsidiary, respectively. Other defendants are LBC Properties, Inc., former LBC Bank President and Chairman Ma. Eliza G. Berenguer, and Juan Carlos Araneta, Santiago G. Araneta, Fernando G. Araneta, Monica G. Araneta, Carlos Araneta, Ofelia F. Cuevas, Apolonia L. Ilio, Joseph Jeffrey Rodriguez, and Arlan T. Jurado. On Sept. 9, 2011, the Monetary Board closed the thrift bank and placed it under PDIC receivership, amid allegations of diversion of bank funds to related companies. Bangko Sentral ng Pilipinas Deputy Governor Nestor A. Espenilla, Jr. said in September 2011 that LBC Bank made cash advances worth billions of pesos to LBC Express, Inc. About LBC LBC Development Bank is a 20-unit thrift bank. Its head office is located at 809 J. P. Rizal St., Poblacion, Makati City. Its 19 branches are located nationwide. As reported in the Troubled Company Reporter-Asia Pacific on Sept. 13, 2011, the Monetary Board placed LBC Development Bank under receivership of the Philippine Deposit Insurance Corporation by virtue of MB Resolution No. 1354 dated Sept. 9, 2011. LBC Development incurred non-performing loans of PHP316.3 million representing 27.29% of its total loan portfolio of more than PHP1 billion as of December 2010, according to Manila Standard Today. The bank also had more than PHP725 million in classified loans and other risk assets as of December last year. Against these high-risk loans, the bank had only PHP158.7 million in specific provision for loan losses. While LBC Development Bank had nearly PHP6 billion in deposit liabilities, its net loans and receivables amounted to less than PHP1 billion, the Manila Standard disclosed. ==================== S O U T H K O R E A ==================== DOOSAN INFRACORE: IPO Plan Will be Credit Positive, Moody's Says ---------------------------------------------------------------- Moody's Investors Service says that the IPO plan of Doosan Infracore International, Inc.'s (DII, B1 CFR stable) parent -- Doosan Bobcat Inc.'s (DBI, unrated) -- will be credit positive, if implemented. "The IPO, if it proceeds as planned, will help improve the credit profiles of both DII as well as its ultimate parent, Doosan Infracore Co., Ltd," says Wan Hee Yoo, a Moody's Vice President and Senior Analyst. According to a public filing on Feb. 23, 2016, Doosan Infracore Co., Ltd (DI, unrated) said that DBI plans to list itself on the Korean stock market in 2016. The size and structure of the IPO has not been decided yet. Should DBI issue new shares during the IPO process, DBI's financial profile will improve. In addition, the IPO will help DI lower its financial leverage. DI's weak financial profile has been a drag on DII's credit profile and rating. In addition, the IPO will improve DBI's and (indirectly) DII's corporate governance and transparency. In 3Q 2015, DBI issued KRW705 billion ($597 million) in convertible preferred shares (CPS) to financial investors through a private placement. At that time, DI said that DBI's CPS issuance was a pre-IPO transaction in conjunction with its listing planned in the next few years. DII and Doosan Holdings Europe Limited (DHEL, unrated) are co- borrowers for the majority of their debt, including the rated $1.2 billion senior secured term loan. Given this structure, Moody's analyzes DII based on DBI's consolidated financials, which effectively combines those of DII and DHEL. DBI is the immediate parent company of DII and DHEL. MAGNACHIP SEMICONDUCTOR: Moody's Affirms Caa2 CFR; Outlook Stable ----------------------------------------------------------------- Moody's Investors Service has revised MagnaChip Semiconductor Corporation's rating outlook to stable from negative. At the same time, Moody's has affirmed its Caa2 corporate family and senior unsecured bond ratings. RATINGS RATIONALE "The change in outlook reflects an improvement in the company's liquidity position, helped by prepaid deposits for the planned sale of the company's 6" fab equipment and cost reductions," says Gloria Tsuen, a Moody's Vice President and Senior Analyst. "Moreover, as the company has become current with its financial filings since 2Q 2015, and it has also agreed in principle to settle its shareholder lawsuits in the past several months, its regulatory and legal risks have declined," adds Tsuen. MagnaChip's cash balance improved to $91 million at end-2015 after five consecutive quarters of decline. The cash balance had risen by $22.5 million sequentially, helped by prepaid deposits for the planned sale of the company's 6" fab equipment and prepayment received for end-of-life products produced in the 6" fab. This level of cash holdings provides a reasonable buffer for negative free cash flow, if any, over the next 1-2 years. The company has no debt refinancing requirement other than the Senior Notes due July 2021. At the same time, the company's operating loss narrowed to $43 million in 2015, from $77 million in 2014, driven by a $42 million year-on-year decrease in operating expenses, as management delivered on its plans to reduce spending. MagnaChip's revenue fell 9% to $634 million in 2015 and its gross margins fell 0.6 percentage points to 21.3%. The company implemented its portfolio optimization plan in early 2015, developing new products and broadening its customer base. There has been some initial traction and management expects revenue and fab utilization -- which drives gross margins -- to improve progressively in 2016. However, whether the company will successfully turn around its operations remains uncertain, particularly given challenging macro-economic conditions. In this regard, Moody's expects MagnaChip to continue reporting operating losses and negative funds from operations in the next several quarters. As indicated, MagnaChip became current again with the filing of its financial statements -- following the filing of Form 10-Q for 2Q 2015 -- and is no longer in breach of the reporting requirements under the covenants of its $225 million notes due 2021. Since December 2015, the company has also agreed in principle to settle its class action shareholder lawsuits. Although it remains under investigation by the Securities and Exchange Commission, the legal overhang and financial risks stemming from issues relating to material weaknesses in the company's internal controls have declined. Upward rating pressure could emerge if the company: 1) successfully turns around its operations such that it can reduce operating loss to a manageable level and generate positive funds from operations on a sustained basis; 2) maintains cash holdings of at least $90-$100 million; and 3) successfully completes the remediation of material weaknesses in its internal controls. On the other hand, downward ratings pressures could re-emerge if the company: 1) fails to turn around its operations, such that it continues to report negative EBITDA and funds from operations; 2) reports cash on hand below $50 million; or 3) fails to complete the remediation of material weaknesses in its internal controls. The principal methodology used in these ratings was Semiconductor Industry Methodology published in December 2015. MagnaChip Semiconductor Corporation is a Korea-based designer and manufacturer of analog and mixed-signal semiconductor products for consumer, computing, communication, industrial, automotive and Internet of Things ("IoT") applications. =============== X X X X X X X X =============== * South Asian NOC Face Higher Risk of Downgrade, Moody's Says ------------------------------------------------------------- Moody's Investors Service says that in its current review of the ratings of national oil companies (NOC) in South and Southeast Asia, companies with ratings higher than their sovereigns face a higher risk of downgrade when compared with NOCs rated at par with their sovereigns. "Petronas, Oil & Natural Gas Corporation and Oil India Limited are rated higher than their respective sovereigns and face a higher risk of downgrade than NOCs rated at par with their sovereigns. We will downgrade the final ratings of these three companies if their baseline credit assessments are lowered," says Vikas Halan, a Moody's Vice President and Senior Credit Officer. "By contrast, there is scope for NOCs with final ratings at par with their respective sovereigns' rating, such as PTT Public Company Limited and Pertamina (Persero) (P.T.), to benefit from varying degrees of additional ratings uplift due to sovereign support in situations where the companies' baseline credit assessments deteriorate," adds Rachel Chua, a Moody's Analyst. Moody's also explained that PTT Exploration and Production Public Company Limited (PTTEP) can benefit from an additional notch of ratings uplift if there is a clear demonstration of extraordinary support from its Thai state-owned parent, PTT. Moody's analysis is contained in its just-released report titled "Oil and Gas - South and Southeast Asia: National Oil Companies Rated Above the Sovereigns Face Higher Risk of Final Ratings Downgrade," co-authored by Halan and Chua. The report points out that on Jan. 22, 2016, Moody's placed the ratings of five NOCs and one NOC subsidiary in South and Southeast Asia on review for downgrade, as Moody's recalibrates ratings globally for the sector in view of the sharp fall in oil prices. Moody's has lowered its oil price estimates and expects a slow recovery for oil prices over the next several years. Moody's review of the companies' ratings will focus on cash flow. In particular, Moody's will assess the impact of Moody's latest crude price assumptions on the cash flows of the Asian oil and gas companies under review. Other credit metrics that Moody's will focus on in its review include the companies': 1) liquidity positions; 2) debt maturity profiles and financing needs; 3) capital and operating spending requirements; and 4) cost structure. Moody's will also consider the companies' efforts to cope with a prolonged downturn in the oil sector, as well as the relative rating positioning of each company in the E&P space globally. Moody's report says that low oil prices will put pressure on most NOCs' baseline credit assessments (BCAs). Such assessments provide indications of the companies' standalone credit strength. For all the companies under review, Moody's expects that their BCAs will fall by at least one notch under Moody's current oil price assumptions, without taking into account a change in management strategy for coping with the sustained pressure on oil prices. Pure play upstream producers or integrated players with a small downstream presence will see more pressure on their fundamental credit profiles. Companies which exhibited high leverage profiles going into the downturn could experience a multi-notch downgrade of their BCAs. Moody's will complete its reviews of the NOCs' ratings by the end of the first quarter in 2016. Subscribers can access the report at: http://www.moodys.com/viewresearchdoc.aspx?docid=PBC_1015759 ********* 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 2016. 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 ***