/raid1/www/Hosts/bankrupt/TCRAP_Public/160303.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
A S I A P A C I F I C
Thursday, March 3, 2016, Vol. 19, No. 44
Headlines
A U S T R A L I A
BRIGHT BEGINNINGS: First Creditors' Meeting Set For March 10
DICK SMITH: Websites and Customer Databases Up for Sale
DIRECT NICKEL: First Creditors' Meeting Set For March 14
FORTESCUE METALS: Fitch Affirms 'BB+' LT Issuer Default Rating
M & J VENTURES: First Creditors' Meeting Set For March 9
MEDIVAC LIMITED: First Creditors' Meeting Set For March 10
OSHCARE 4: First Creditors' Meeting Scheduled For March 11
QANTAS AIRWAYS: Moody's Withdraws Ba1 Corporate Family Rating
C H I N A
AGILE PROPERTY: Moody's Puts Ba3 CFR on Review for Downgrade
BEIJING CAPITAL: Moody's Puts Ba2 CFR on Review for Downgrade
CHINA: Fitch Says Yuan Fall Reins in Offshore Funding Plans
CHINA: Halts Two Overseas Investment Schemes
SUNTECH POWER: US Unit's Plan Exclusivity Extended to July 7
H O N G K O N G
CHINA FISHERY: Former Sino Forest Exec Appointed as CRO
CITIC RESOURCES: Moody's Lowers CFR to B1; Outlook Negative
GRUSS CAPITAL: Event-Driven Hedge Fund Manager Shutting HK Office
I N D I A
ABHINAASH AGROFOOD: Ind-Ra Assigns 'IND B+' LT Issuer Rating
AJANTA GARTEX: CRISIL Assigns B Rating to INR75MM Term Loan
AL-RKAYAN APPARELS: ICRA Reaffirms B+ Rating on INR25cr Loan
ALVA'S EDUCATION: ICRA Reaffirms B+ Rating on INR106cr Loan
AMRIT POLYCHEM: ICRA Assigns B+ Rating to INR12cr Cash Loan
ARYAN MINING: Ind-Ra Downgrades 'IND B' Long-Term Issuer Rating
AVVAS INFOTECH: ICRA Suspends 'D' Rating on INR17.5cr Loan
BHAGWATI DIAMONDS: CRISIL Assigns 'B+' Rating to INR115MM Loan
BORAH AUTOMOBILES: CARE Revises Rating on INR12.18cr Loan to B+
BRAHMANI RIVER: Ind-Ra Cuts Long-Term Issuer Rating to 'IND D'
BRAMHACORP HOTELS: Ind-Ra Withdraws 'IND B+' LT Issuer Rating
CHINTAMANI JEWELS: ICRA Suspends B+ Rating on INR8cr Loan
DELTRONIX INDIA: Ind-Ra Suspends 'IND D' Long-Term Issuer Rating
EQUIPLUS (INDIA): ICRA Suspends B+ Rating on INR11.25cr Loan
FASHION FLARE: ICRA Revises Rating on INR2cr Term Loan to B+
FORTUNE CARS: CARE Revises Rating on INR15cr Loan to B+
G. N. PET: CRISIL Lowers Rating on INR35.5MM Term Loan to D
GROVER ZAMPA: CRISIL Assigns B Rating to INR116MM Cash Loan
GUPTA GLOBAL: CRISIL Assigns 'D' Rating to INR1.41BB LT Loan
H.L. PASSEY: Ind-Ra Suspends 'IND BB' Long-Term Issuer Rating
HAJI ALIMOHAMED: ICRA Reaffirms B+ Rating on INR12cr Loan
HALCYON LIFE: ICRA Suspends 'D' Rating on INR40.5cr Loan
INCOM CABLES: Ind-Ra Assigns 'IND BB+' Long-Term Issuer Rating
INDIAN CANE: CARE Lowers Rating on INR253.49cr LT Loan to D
INDO PRODUCTS: CARE Assigns 'B' Rating to INR6cr LT Loan
J. K. DEVELOPERS: CRISIL Assigns B+ Rating to INR120MM Term Loan
KOYO GRANITO: CRISIL Assigns 'B' Rating to INR170MM Term Loan
M P AGARWALA: Ind-Ra Assigns 'IND BB' Long-Term Issuer Rating
M. D. AGRO: ICRA Reaffirms B+ Rating on INR25cr LT Loan
M. MOHAN: ICRA Assigns 'B' Rating to INR1.25cr LT Loan
MAGBRO HEALTHCARE: CRISIL Reaffirms B- Rating on INR70MM Loan
MAHALAXMI SEAMLESS: CRISIL Assigns 'B' Rating to INR40MM Loan
MAHALAXMI TRANSPORT: CRISIL Assigns 'B' Rating to INR160MM Loan
MALHAR FASHIONS: CRISIL Assigns B- Rating to INR37MM Loan
MALIK MARKETING: ICRA Assigns 'B' Rating to INR7.50cr Cash Loan
MANOJ TRADING: ICRA Reaffirms B+ Rating on INR32cr Cash Loan
MOTHERHOOD INSTITUTE: ICRA Assigns B+ Rating to INR5.0cr Loan
MSV LABORATORIES: CARE Reaffirms B Rating on INR7.86cr LT Loan
MUKTAR AUTOMOBILES: CARE Reaffirms 'B' Rating on INR12.36cr Loan
NITYAGOPAL RICE: CRISIL Assigns B Rating to INR42.5MM Term Loan
NORTH EAST: CARE Assigns B+ Rating to INR5.95cr LT Loan
OM BIOMEDIC: Ind-Ra Suspends 'IND D' Long-Term Issuer Rating
OM GANESH: CRISIL Assigns B+ Rating to INR172.3MM Loan
PADMEY IMPEX: Ind-Ra Downgrades LT Issuer Rating to 'IND D'
PANDA INFRA: CRISIL Upgrades Rating on INR150MM Cash Loan to B
PARIKH CONSTRUCTIONS: ICRA Suspends 'C' Rating on INR12.5cr Loan
PATWARI PLASTICS: CRISIL Assigns B+ Rating to INR50MM Cash Loan
POPURI STEELS: ICRA Revises Rating on INR10cr LT Loan to B-
PT. DEEN: ICRA Suspends B+ Rating on INR12.37cr Bank Loan
R. NATARAJAN: CRISIL Assigns 'B' Rating to INR50MM Cash Loan
R.K NATURAL: Ind-Ra Assigns 'IND B' Long-Term Issuer Rating
RAAM FOUR: ICRA Suspends 'B' Rating on INR9.45cr Loan
RADHA SMELTERS: Ind-Ra Cuts Long-Term Issuer Rating to 'IND D'
RAMKY PHARMA: ICRA Revises Rating on INR15cr Loan to C+
RIA HOTELS: ICRA Suspends B- Rating on INR17.5cr Loan
RUPESH & COMPANY: ICRA Suspends B+ Rating on INR7cr Loan
S.P.P FOOD PRODUCTS: Ind-Ra Suspends 'IND BB+' LT Issuer Rating
S.R.CONSTRUCTIONS: ICRA Suspends B Rating on INR15cr Loan
SADHANA SUITINGS: CARE Assigns B+ Rating to INR8.25cr LT Loan
SAI-LAXMI TEXOFAB: ICRA Reaffirms 'B' Rating on INR6.50cr Loan
SAIKRUPA FIBRES: Ind-Ra Suspends 'IND B-' Long-Term Issuer Rating
SANGAM STEELS: CARE Assigns 'B' Rating to INR7cr LT Loan
SANJAY INDUSTRIAL: Ind-Ra Suspends 'IND B+' LT Issuer Rating
SHIVAM MOTORS: ICRA Reaffirms B+ Rating on INR38cr Cash Loan
SHREE RAJASVI: CRISIL Lowers Rating on INR160MM Loan to 'B-'
SHREERANGAM PACKAGING: CARE Reaffirms B+ Rating on INR9.71cr Loan
SHRI RAMESHWAR: CRISIL Lowers Rating on INR300MM Loan to C
SHRISHTI TECHNOLOGIES: ICRA Reaffirms B+ Rating on INR6cr Loan
SIDDHARTH EXPORTS: ICRA Assigns B+ Rating to INR4.0cr Loan
SIRIUS INFRA: CARE Reaffirms 'D' Rating on INR5cr Loan
SMITABH INTERCON: Ind-Ra Suspends IND B- Long-Term Issuer Rating
SOWBHAGYA ISPAT: Ind-Ra Suspends 'IND D' Long-Term Issuer Rating
SRI GOWRI: CRISIL Assigns B+ Rating to INR60MM Cash Loan
SRI LAKSHMI: ICRA Reaffirms 'B' Rating on INR5.50cr Cash Loan
SRI SRINIVASA: ICRA Suspends B+ Rating on INR4.80cr Loan
SRINIVASA AGRO: Ind-Ra Assigns 'IND BB-' Long-Term Issuer Rating
SUPREME BEST: Ind-Ra Cuts INR2.4BB Term Loan Rating to 'IND D'
SUPREME SUYOG: Ind-Ra Cuts INR500M LT Sr. Proj. Loan to 'IND D'
SURYA COTTON: CARE Reaffirms B+ Rating on INR7.56cr LT Loan
SURYAVANSHI SPINNING: ICRA Revises Rating on INR48cr Loan to B
SWADESHI TEXTILES: Ind-Ra Assigns 'IND B' Long-Term Issuer Rating
SWASTIK CEMENT: Ind-Ra Suspends 'IND BB-' Long-Term Issuer Rating
TARACHAND INTERNATIONAL: CARE Revises Rating on INR50cr Loan to D
THRIIVE CARS: CRISIL Reaffirms B+ Rating on INR35MM Loan
TIRUPATI AGENCIES: Ind-Ra Suspends IND D Long-Term Issuer Rating
YESKAY CONSTRUCTIONS: CRISIL Reaffirms B+ Rating on INR60MM Loan
I N D O N E S I A
MERPATI NUSANTARA: Restructuring to be Completed This Year
N E W Z E A L A N D
MERCER GROUP: To Refinance Bank Debt With Newly Structured Loan
P H I L I P P I N E S
RURAL BANK OF BAYAWAN: Placed Under PDIC Receivership
S I N G A P O R E
FIDJI LUXEMBOURG: Moody's Withdraws B1 Corporate Family Rating
V I E T N A M
SAIGON THUONG: Moody's Confirms B3 Deposit and Issuer Ratings
X X X X X X X X
* Steel Producers to Report Lower Earnings in 2016, Moody's Says
- - - - -
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A U S T R A L I A
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BRIGHT BEGINNINGS: First Creditors' Meeting Set For March 10
------------------------------------------------------------
Jason Tang and Ozem Kassem of Cor Cordis Chartered Accountants
were appointed as administrators of Bright Beginnings Learning
Centre Pty. Ltd., trading as Bright Beginnings Learning Centre, on
Feb. 29, 2016.
A first meeting of the creditors of the Company will be held at
the offices of Cor Cordis Chartered Accountants, Level 6, 55
Clarence Street, in Sydney, on March 10, 2016, at 11:00 a.m.
DICK SMITH: Websites and Customer Databases Up for Sale
-------------------------------------------------------
Eloise Keating at SmartCompany reports that the receivers of Dick
Smith have commenced a sale campaign for the electronic retail
chain's online divisions and intellectual property, including the
chain's website domains and customer databases.
SmartCompany relates that in an advertisement in the March 2
edition of the Australian Financial Review, receivers Ferrier
Hodgson called for urgent expressions of interest in the online
divisions of the Dick Smith and Move businesses.
Ferrier Hodgson are also seeking buyers for Dick Smith's brands
and trademarks, customer databases and websites and domain names,
SmartCompany relays.
SmartCompany says potential buyers have until Friday, March 4 to
express their interest in purchasing the assets.
The same campaign comes just days after Ferrier Hodgson announced
all remaining Dick Smith stores will close over the next eight
weeks after a buyer was unable to be found for the electronics
chain, says SmartCompany.
The report adds that receiver James Stewart said in a statement
that the sales process did not result in "any acceptable offers
for the group as a whole or for Australia or New Zealand as
standalone businesses".
"The offers were either significantly below liquidation values or
highly conditional or both," Mr. Stewart said.
About Dick Smith
Dick Smith Holdings Limited Ltd (ASX:DSH) --
http://dicksmithholdings.com.au/-- is a retailer of consumer
electronics products. The Company sells a range of products across
four categories: office, mobility, entertainment, and other
products and services. The Company has two segments: Dick Smith
Australia and Dick Smith New Zealand. The Company connects with
its customers through four physical store formats, catering for
three distinct consumer demographics: Dick Smith, MOVE, David
Jones Electronics Powered by Dick Smith and MOVE by Dick Smith
Sydney International Airport. The Company's store network consists
of approximately 393 stores across Australia and
New Zealand, which include approximately 351 Dick Smith stores,
approximately 10 MOVE stores, approximately four MOVE by Dick
Smith stores and approximately 28 David Jones Electronics Powered
by Dick Smith stores.
As reported in the Troubled Company Reporter-Asia Pacific on
Jan. 6, 2016, Dick Smith Holdings Ltd was placed in receivership
on Jan. 5 following the appointment of Voluntary Administrators.
Ferrier Hodgson partners Mr James Stewart, Mr Jim Sarantinos and
Mr Ryan Eagle were appointed Receivers and Managers over DSH and
an number of associated entities. The appointment was made by a
syndicate of lenders which hold security over the group.
Receiver Mr James Stewart said it was too early to clearly
identify the primary causes of the company's current financial
position and the reasons for its decline other than saying the
business had become cash constrained in recent times. He said it
would be business as usual while the Receivers look at the
restructuring and realisation opportunities for the Group.
"Dick Smith is one of the best known brands associated with,
consumer electronics in Australia and New Zealand," Mr Stewart
said. "We are immediately calling for expressions of interest for
a sale of the business as a going concern."
Mr Stewart said that employees will continue to be paid by the
Receivers and that it is expected that Australian employee
entitlements will be covered under the Fair Entitlements Guarantee
(FEG) scheme if the business cannot be sold as a going concern.
Mr Stewart added that the New Zealand business was profitable and
expected it would be attractive to potential buyers. He also
stated that due to the financial circumstances of the Group,
unfortunately, outstanding gift vouchers cannot be honoured and
deposits cannot be refunded. Affected customers will become
unsecured creditors of the Group.
DIRECT NICKEL: First Creditors' Meeting Set For March 14
--------------------------------------------------------
Jack James of Palisade Business Consulting Pty Ltd was appointed
as administrators of Direct Nickel Projects Pty Limited on March
1, 2016.
A first meeting of the creditors of the Company will be held at
Palisade Business Consulting, Level 1, 330 Churchill Avenue, in
Subiaco, on March 14, 2016, at 2:00 p.m.
FORTESCUE METALS: Fitch Affirms 'BB+' LT Issuer Default Rating
--------------------------------------------------------------
Fitch Ratings has affirmed Australia-based iron ore miner,
Fortescue Metals Group Limited's Long-Term Issuer Default Rating
(LT IDR) at 'BB+' and maintained the Negative Outlook. The agency
has also affirmed Fortescue's outstanding issue ratings. A full
list of ratings can be found at the end of this commentary.
The affirmation of Fortescue's ratings comes in spite of the
decline in market prices for iron ore, and reflects the company's
strong progress in cost reductions. Fortescue's cash production
costs (or C1 costs) reduced by almost 50% over the 12 months to
end-2015, averaging $US 16/ton in 1HFY16 (fiscal year ends 30
June). The benchmark price for iron ore, with 62% iron content
delivered to China has fallen by around 40% during the same
period. The ratings factor in Fitch's view that the benchmark iron
ore price will average around $US 45/ton in 2016 and 2017, and
recover slightly to $US 50/ton in 2018 and over the long-term.
The Negative Outlook on Fortescue's LT IDR continues to reflect
risks to the company's credit profile should iron ore prices
underperform against our current expectations. Fortescue's ability
to deleverage remains sensitive to iron ore prices, despite it
achieving significant cost reductions. Accordingly, Fitch has
amended its negative rating sensitivities to focus on free cash
flow generation (FCF, after capex and dividends) as opposed to
interest cover. We expect Fortescue's Funds Flow from Operations
(FFO) adjusted net leverage to remain below 3x between FY16 and
FY18 (fiscal year ends 30 June), and for the company to generate
FCF of at least $US 750m annually during the same period.
KEY RATING DRIVERS
Cost-Reduction Continues: Fortescue reported average cash
production costs (or C1 costs) of $US 16/ton in 1HFY16, which is
down around 70% over the last three years. While Fortescue expects
strip ratios to add $US 1/t to C1, Fortescue expects to end FY16
at $US 13/ton with additional cost savings from processing ($US
0.70/t), mining productivity ($US 1.30/t), procurement ($US
0.50/t) and inventory and FX ($US 0.50/t). The company currently
estimates that the benchmark iron ore price needed to break even
on its cash costs is around $US 29/ton, which is 26% lower than
the $US 39/ton it reported at FY15.
Costs Sustainable in the Medium Term: We expect Fortescue's cost
reductions to be sustainable at least over the next 24 months.
Lower costs are due to a combination of product blend and
upgrading of ore processing facilities, allowing for lower-grade
ore inputs to be used while sustaining output quality. Its newer
low-cost Solomon-hub mines have also now fully ramped-up
production, which has reduced overall strip ratios. The company
has delivered higher efficiencies from its existing port and rail
infrastructure and increased its port capacity. Lower crude oil
prices have contributed to a reduction in operational and shipping
costs, and a weaker local exchange rate has also supported lower
costs.
Comfortable Liquidity: At end-2015 Fortescue had $US 2.3bn cash on
hand, with no significant debt maturities until at least 2019 when
its $US 4.8bn secured credit facility, and $US 577m of senior
unsecured notes fall due. Fortescue purchased $US 750m of senior
unsecured notes via a tender offer in 1HFY16, and a further $US
384m of senior unsecured notes off the market. The company appears
to be committed to reducing its debt to a targeted gross gearing
ratio of 40% (end-1HFY16: 52%, and 42% net of cash), supported by
its comfortable free cash flow generation.
KEY ASSUMPTIONS
Fitch's key assumptions within the rating case for Fortescue
include:
-- Benchmark iron ore prices will average $US 45/ton in 2016 and
2017, and $US 50/ton in 2018
-- Fortescue achieves 85% price realisation of the benchmark
iron ore price, after discounts for grade, moisture and
product quality
-- C1 costs of $US 15/ton in FY16, $US 13.4/ton in FY17, and $US
13.2/ton in FY18, broadly in line with management's guidance
-- AUD/$US of 71 US cents in FY6 and FY17, and increase to 74
US cents in FY18
-- All-in costs will average around $US 26/ton in FY17 - FY18
-- Fortescue will use materially all of its cash to repay debt
RATING SENSITIVITIES
Negative: Future developments that may, individually or
collectively, lead to negative rating action include:
-- FFO-adjusted net leverage exceeding 3x on a sustained basis
(1HFY16: 2.3x)
-- An inability to generate FCF of at least $US 750m annually
Positive: Not meeting the negative sensitivities for an extended
period of time will result in the outlook being revised to Stable
The full list of ratings actions is as follows:
Fortescue Metals Group Limited
-- Long-Term IDR Affirmed at 'BB+' with a Negative Outlook
-- Long-Term Rating on Senior Secured Debt Affirmed at 'BBB-'
-- Long-Term Rating on senior unsecured debt affirmed at 'BB'
FMG Resources (August 2006) Pty Ltd
-- Senior secured notes due in 2022 affirmed at 'BBB-'
-- Senior secured term loan due in 2019 affirmed at 'BBB-'
-- Senior unsecured notes due in 2019 and 2022 affirmed at 'BB'
M & J VENTURES: First Creditors' Meeting Set For March 9
--------------------------------------------------------
Richard Albarran and Brent Kijurina of Hall Chadwick Chartered
Accountants were appointed as administrators of M & J Ventures 2
Pty Ltd, trading as Subway Kensington, on Feb. 26, 2016.
A first meeting of the creditors of the Company will be held at
Wesley Mission, The Pacific Room, Lower Level Ground, 220 Pitt
Street, in Sydney, March 9, 2016, at 11:00 a.m.
MEDIVAC LIMITED: First Creditors' Meeting Set For March 10
----------------------------------------------------------
Brent Kijurina, Richard Albarran and Cameron Shaw of Hall Chadwick
Chartered Accountants were appointed as administrators of Medivac
Limited on Feb. 29, 2016.
A first meeting of the creditors of the Company will be held at
The Grace Hotel, Pinaroo 1 Room, Level 1, 77 York Street, in
Sydney, on March 10, 2016, at 12:30 p.m.
OSHCARE 4: First Creditors' Meeting Scheduled For March 11
----------------------------------------------------------
Travis Pullen of TJP Advisory was appointed as administrator of
Oshcare 4 Kids Pty Ltd, on March 1, 2016.
A first meeting of the creditors of the Company will be held at
Level 2, 710 Collins Street, in Docklands, Victoria, on March 11,
2016, at 9:15 a.m.
QANTAS AIRWAYS: Moody's Withdraws Ba1 Corporate Family Rating
-------------------------------------------------------------
Moody's Investors Service has upgraded the senior unsecured
ratings of Qantas Airways Ltd. to Baa3 from Ba1. As part of the
action Moody's has also assigned a senior unsecured issuer rating
of Baa3, and has upgraded Qantas' short term ratings to P-3 from
NP and program ratings to (P)Baa3/(P)P-3 from (P)Ba1/(P)NP.
As part of the action, Moody's withdrew Qantas' Ba1 corporate
family rating.
The outlook on all ratings is stable.
RATINGS RATIONALE
"The upgrade of the senior unsecured rating to Baa3 is based on
the significant reduction in leverage since FY2015, on the back of
lower fuel prices and continued success of its transformation
programme as well as a reduction in debt by AUD1 billion from the
level in FY2014" says Ian Chitterer a Moody's Vice President -
Senior Analyst.
Qantas has reduced its adjusted debt/EBITDA to about 2.5x for the
12 months ending December 2015, and Moody's expects leverage to be
at about 2.1-2.3x in FY2016.
Moody's upgrade also reflects Qantas' commitment to maintain a
prudent and conservative financial framework that includes
prioritizing return on invested capital (ROIC) and maintaining an
optimum capital structure for growth and shareholder returns,
whilst targeting investment-grade credit metrics through the
cycle.
"The company's updated financial framework and focus on ROIC
indicates that Qantas will take the necessary steps to address
volatility, periods of sustained weak demand and high fuel prices"
adds Chitterer.
The substantial fall in fuel prices is expected to reduce Qantas'
fuel charge by over AUD1 billion in FY2016 vs FY2014 and supports
our expectation for significant overall earnings improvement in
fiscal 2016. Moody's expects the EBITDA margin to reach about 22-
23% in the next 12-18 months. Based on Moody's forecast prices
for Brent and aircraft fuel, along with Qantas' hedging policy,
the agency expects Qantas to benefit from historically low fuel
prices for the next several years.
Another important driver of earnings improvement is Qantas'
considerable progress on its transformation and cost saving
initiatives. The company has achieved cost savings of AUD1.36
billion, of its AUD2 billion target to be realized by FY2017, and
is on track to achieving AUD450 million of benefits in FY2016.
Moody's views continued implementation of this program as critical
to improving the competitiveness of Qantas' operations over the
long term, while maintaining its premium service levels. As such,
we expect Qantas to continue focusing on its transformation agenda
post 2017, through operational and fleet-enabled efficiencies.
WHAT COULD CHANGE THE RATINGS
Due to the need to establish a track record under the new
financial framework, an upgrade is considered unlikely over the
next 12-18 months. If Qantas reduces debt over a sustained
period, continues to improve profitability and cash flow, and
builds a track record under its new financial framework, positive
momentum could emerge.
Moody's would consider downgrading the ratings if Qantas is unable
to sustain and/or build on recent improvements in the
profitability of its international and domestic businesses, and/or
adjusted debt/EBITDA increases to about 3.5x on a sustained basis.
A material deterioration in liquidity could also weaken the
carrier's credit quality and pressure its ratings.
The principal methodology used in these ratings was Global
Passenger Airlines published in May 2012.
Qantas Airways Ltd. is Australia's principal airline. It has
three domestic flying brands: Jetstar (the point-to-point Low Cost
Carrier), QantasLink (a regional carrier) and Qantas mainline,
which predominantly links capital cities.
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C H I N A
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AGILE PROPERTY: Moody's Puts Ba3 CFR on Review for Downgrade
------------------------------------------------------------
Moody's Investors Service has placed Agile Property Holdings
Limited's Ba3 corporate family rating and B1 senior unsecured
rating on review for downgrade.
This ratings review follows Agile's profit warning on Feb. 24,
2016, that profit attributable to shareholders for 2015 was likely
to have declined by 70%. The results for 2015 will be due by late
March.
RATINGS RATIONALE
"The review is triggered by our concerns over the company's
weakened level of financial metrics and its weak liquidity
position," says Kaven Tsang, a Moody's Vice President and Senior
Credit Officer.
Agile's gross profit margin for 2015 was lower than Moody's
original expectation, and it is likely to stay at around 25% in
the next 12-18 months, weakening from 29.6% in 1H 2015.
The decline was mainly due to active presales at lower price
levels as the company tried to reduce inventory in 2014 and 2015.
Moody's expects Agile's EBIT/interest will fall to 2.5x-2.6x in
the coming 12-18 months, which is weak for its Ba3 ratings.
In addition, Agile's liquidity remains weak, though its contracted
sales in 2015 were broadly in line with its target and it has been
disciplined in its land acquisitions.
Moody's estimates that Agile had cash-on-hand of around RMB12
billion at end-2015, but its fund-raising needs will remain high.
This is because it has to fund its projects for presale in 2016
and the sizable amount of offshore bonds, totaling around USD1.7
billion (around RMB11 billion), that will be due for repayment in
1H 2017.
Moody's review will focus on (1) Agile's liquidity management,
including the refinancing arrangements for its short-term debt and
offshore bonds due in 1H 2017; (2) its plans for contracted sales
and land acquisitions for 2016; and (3) its full-year results for
2015 and expected financial profile for the next 12-18 months.
The principal methodology used in these ratings was Homebuilding
And Property Development Industry published in April 2015.
Agile Property Holdings Limited is one of China's major property
developers, operating in the mid- to high-end segment. At
Aug. 26, 2015, the company had a land bank with a total gross
floor area of 38.6 million square meters in 41 cities and
districts in China. Southern China (mainly Guangdong Province) is
its largest market, accounting for around 35% of the company's
land bank and around 48% of its pre-sales in 1H 2015.
BEIJING CAPITAL: Moody's Puts Ba2 CFR on Review for Downgrade
-------------------------------------------------------------
Moody's Investors Service has placed these ratings of Beijing
Capital Group Co., Ltd. and its subsidiaries on review for
downgrade.
1. The Baa2 issuer rating of Beijing Capital Group Co., Ltd.
(Capital Group);
2. The Baa2 backed senior unsecured rating to the bonds issued
by Beijing Capital Polaris Investment Co. Ltd. and
guaranteed by Capital Group;
3. The Ba2 corporate family rating of Beijing Capital Land
Limited;
4. The Ba3 corporate family rating of International Financial
Center Property Ltd. (IFC);
5. The Ba3 backed senior unsecured debt rating to the bonds
issued by Central Plaza Development Ltd. (CPD); and
6. The provisional (P)Ba3 backed senior unsecured rating of the
Medium Term Note (MTN) program of CPD.
Both the bonds and MTN program of CPD are guaranteed by IFC.
They are also supported by Deeds of Equity Interest Purchase
Undertaking and Keepwell Deeds between Beijing Capital Land
Limited, CPD, IFC and the bond trustee. Both CPD and IFC are
wholly-owned subsidiaries of Beijing Capital Land Limited.
Additionally, Capital Group, the parent of Beijing Capital Land
Limited, provides Letters of Support in favor of Beijing Capital
Land Limited and IFC in connection with both the bonds and the MTN
program.
RATINGS RATIONALE
"The review for downgrade of Capital Group is driven by our
concerns over the company's ability to reduce its high debt
leverage, as planned, in light of the weakening economic
environment in China," says Kaven Tsang, a Moody's Vice President
and Senior Credit Officer, and also the Lead Analyst of Capital
Group.
Capital Group's high debt leverage is primarily a result of the
fast debt-funded expansion of its property and water services
businesses in 2015, and the slower-than-expected progress in asset
disposals.
Moody's estimates that Capital Group's adjusted net debt/EBITDA
had kept around 10x at end-2015, a level inconsistent with its
baseline credit assessment of ba2.
Capital Group's Baa2 issuer rating also incorporates a three-notch
uplift due to Moody's expectation of a high level of financial
support from the Beijing Municipal Government (unrated) in times
of stress.
The Ba2 rating of Beijing Capital Land Limited is also on review
for downgrade due to its persistently high level of debt leverage
and the weakened credit profile of Capital Group, its parent.
Beijing Capital Land Limited's rating reflects its standalone
credit strength and a two-notch rating uplift, based on expected
strong financial and operating support from Capital Group.
Moody's notes that Beijing Capital Land Limited has repositioned
its business to first-tier and major second-tier cities, and
achieved a strong 31% growth in contracted sales to RMB32.5
billion in 2015.
However, the company has experienced falling profit margins which
have, in turn, weakened its credit metrics.
Beijing Capital Land Limited's debt leverage -- measured by
revenue/debt -- was 19.7% as of June 30, 2015, and interest
coverage was 1.2x, weak for its standalone credit strength.
Moody's expects these metrics will likely to stay weak at end-
2015.
Moody's will focus its review on (1) Capital Group's and Beijing
Capital Land Limited's business strategies and financial policies
in managing their growth plans in a challenging operating
environment; (2) the companies' plan to reduce debt leverage; (3)
the companies' 2015 results and their financial profiles over the
next 12-18 months; and (4) Capital Group's ability to provide
financial support to Beijing Capital Land Limited.
IFC's Ba3 corporate family rating is put on review for downgrade
due to the weakened credit profile of Beijing Capital Land
Limited.
The principal methodology used in rating Beijing Capital Group
Co., Ltd. was Homebuilding And Property Development Industry
published in April 2015. Other methodologies used include the
Government-Related Issuers methodology published in October 2014.
The principal methodology used in rating Beijing Capital Land
Limited, Beijing Capital Polaris Investment Co., Ltd., Central
Plaza Development Ltd., and International Financial Center
Property Ltd. was Homebuilding And Property Development Industry
published in April 2015.
Incorporated in the British Virgin Islands in 2000, International
Financial Center Property Ltd (IFC) is a 100%-owned subsidiary of
Beijing Capital Land Limited. IFC is an overseas investment
holding company that owns property development projects in China.
Beijing Capital Land Limited was incorporated in China in 2002 and
is the property arm of Beijing Capital Group Ltd (Capital Group).
Beijing Capital Land Limited listed on the Stock Exchange of Hong
Kong in 2003. Capital Group is Beijing Capital Land Limited's
largest shareholder with an equity interest of 54.5%. GIC,
Singapore's sovereign wealth fund, is also a major shareholder
with a 5.5% stake.
Founded in 1994, Capital Group is 100% owned by the Beijing
Municipal Government and is under the direct supervision of the
State-Owned Assets Supervision and Administration Commission of
the Beijing Municipality. It has four major business segments:
(1) environmental protection; (2) infrastructure; (3) real estate;
and (4) financial services.
CHINA: Fitch Says Yuan Fall Reins in Offshore Funding Plans
-----------------------------------------------------------
The depreciation of the Chinese yuan is slowing down offshore bond
issuance by Chinese local government financing vehicles (LGFVs),
Fitch Ratings says. However, offshore bond issuance by LGFVs will
not halt entirely because they would still need to diversify their
funding channels while some local governments use debt issuance as
an opportunity to promote their regions overseas.
LGFVs' high and rising debt burden has been eased after Chinese
authorities lowered domestic interest rates and implemented a
programme that allows LGFVs to swap higher-cost debt for lower-
cost bonds. However, the lower rates have driven capital outflows
from China, which may further weaken the yuan.
If the Chinese currency keeps depreciating, LGFVs' offshore debt
servicing costs will continue to rise as they pay more in local-
currency terms. The impact will be largest on debt denominated in
the US dollar, which has appreciated sharply against the yuan and
accounts for the majority of LGFVs' offshore debt.
However, the overall impact of the sliding yuan on LGFVs is still
manageable because foreign-currency debt forms only a small
portion of their total debt - the ratio was less than 10% for
Fitch-rated Chinese LGFVs.
Fitch expects some LGFVs to continue issuing debt in US dollars to
diversify from the domestic bond market. Moreover, local
governments often use the issuance of an offshore bond to raise
their profiles in international capital markets and to promote the
region to external investors.
Large, provincial-level LGFVs with strong sponsors are likely to
be more cautious about raising funds offshore because there is no
longer the advantage of lower costs compared with domestic
funding. We expect more lower-tier LGFVs to debut in the US dollar
bond market with smaller issuance size, either to promote the
local economy or to seek alternative funding when faced borrowing
restrictions onshore.
Most LGFVs' standalone credit profiles and cash generation
capabilities are low because of their public-sector obligations.
The creditworthiness of the sponsor to which the LGFV is credit-
linked and the strength of the linkage between the entity and the
sponsor are the key factors that would affect an issuer's credit
profile.
CHINA: Halts Two Overseas Investment Schemes
--------------------------------------------
Don Weinland at The Financial Times reports that Beijing has
mothballed two pioneering outbound investment schemes, according
to people with knowledge of the situation, in its latest bid to
stem capital outflows and shore up the renminbi.
The FT relates that the halt in the allotment of quotas reflects
fears over the massive amount of cash -- some economists estimate
up to $1 trillion last year -- that has left the country through
official and unofficial channels as economic growth slows and the
renminbi continues to depreciate.
The report says the schemes were part of liberalisation moves
designed to facilitate overseas investment in China and allow
domestic funds to buy foreign securities. But last August's
renminbi devaluation and subsequent capital flight has triggered a
spate of reversals and watering-down of schemes that enable
China's currency to leave the country, the report recalls.
According to the FT, the casualties include the so-called
Qualified Domestic Limited Partner scheme, designed to allow
foreign asset managers -- including the likes of BlackRock and
Aberdeen Asset Management -- in Shanghai's free trade zone to sell
overseas investment products directly to wealthy Chinese clients.
The two asset managers were among global groups that received
licences last year but have waited in some cases more than six
months for quotas, the FT reports.
The FT notes that the State Administration of Foreign Exchange has
also delayed the launch of an updated programme for domestic
investors to invest in equities abroad, known as the Qualified
Domestic Institutional Investor 2 scheme, or QDII2.
According to the report, one person familiar with the matter said
the suspension was clear but not an official measure. It was "part
of Safe's effort to monitor capital flows", he said.
Another person familiar with the scheme said Safe was in prolonged
negotiations with the asset managers on how to salvage the
licences in a fresh format, the FT relays.
Seven global asset managers were issued licences starting in July
last year but none of them have been issued the quota necessary to
launch the business, the FT relays citing data compiled by
Shanghai-based consultancy Z-Ben Advisors.
The FT adds that the QDLP programme was originally launched in
2013 and allowed hedge funds to raise capital onshore for
investment offshore. Since then, 10 foreign asset managers with
wholly owned companies in Shanghai's free trade zone have received
licences and upwards of $1bn in quotas to raise onshore capital
for other alternative asset classes such as property and
infrastructure.
But conflicting regulation of the scheme meant that, while asset
managers in the QDLP pilot secured licences from China's
securities regulator and a local bureau called the Shanghai
Finance Office, they were stymied by Safe withholding quota
approval, the FT states.
The FT notes that Safe's efforts to stem capital flows have seen
it halt foreign exchange businesses at three foreign banks in
recent months. Domestic asset managers have also reported that
Safe stopped issuing new quotas for the Qualified Domestic
Institutional Investor (QDII) licence, allowing local companies to
invest abroad.
"I think the quota suspension is a result of a broader regulatory
push for capital controls," the FT quotes Chris Powers, a senior
consultant at Z-Ben as saying. "The same rationale can be applied
to the . . . QDII2 programme, which likely has been suspended due
to Safe's reluctance to open additional outbound channels."
The FT recalls that when announced last year, the new QDLP scheme
was hailed as a breakthrough for traditional asset managers
looking for direct access to mainland wealth. It was also seen as
a strong competitor to cross-border investment channels based in
Hong Kong.
The FT adds that BlackRock declined to comment on the allotment of
quota but a spokesperson said: "BlackRock continues to work
closely with the authorities in connection with the QDLP
programme."
SUNTECH POWER: US Unit's Plan Exclusivity Extended to July 7
------------------------------------------------------------
The Hon. Christopher Sontchi of the U.S. Bankruptcy Court for the
District of Delaware extended Suntech America, Inc., et al.'s
exclusive periods to file a chapter 11 plan until May 6, 2016, and
solicit acceptances for that plan until July 7, 2016.
As reported by the Troubled Company Reporter on Dec. 16, 2015,
Judge Sontchi extended until Jan. 7, 2016, their plan filing
period and solicitation of acceptances for that plan.
In support of their request for an extension, the Debtors stated
that "although steps towards a consensual plan remain the Debtors'
goal, the Debtors must retain the ability to focus on the
remaining items that are important to their emergence from Chapter
11 without the distraction, disruption, and expense of competing
chapter 11 plans. Among other items, the Debtors must resolve
significant and complex claims that have been asserted against the
Debtors' estates, including Wuxi's disputed claim and warranty
claims that implicate Wuxi."
About Suntech America
Suntech America, Inc., and Suntech Arizona, Inc. filed for Chapter
11 bankruptcy protection (Bankr. D. Del. Case Nos. 15-10054 and
15-10056) on Jan. 12, 2015. Judge Christopher S. Sontchi presides
over the case.
Mark D. Collins, Esq., Paul Noble Heath, Esq., William A.
Romanowicz, Esq., Zachary I Shapiro, Esq., at Richards, Layton &
Finger, P.A., serve as the Debtors' bankruptcy counsel. Upshot
Services LLC is the Debtors' claims and noticing agent.
The Debtors estimated their assets at between $100 million and
$500 million, and their debts at between $100 million and $500
million.
Headquartered in San Francisco, California, Suntech America, aka
Suntech Power, an affiliate of Wuxi, China-based Suntech Power
Holdings Corp., was the main operating subsidiary of the Suntech
Group in the Americas and its primary business purpose was acting
as an intermediary for marketing, selling and distributing Suntech
Group manufactured products.
* * *
Judge Christopher Sontchi of the U.S. Bankruptcy Court for the
District of Delaware will convene a hearing on Feb. 25, 2016, at
2:00 p.m. (ET) to consider confirmation of Suntech America, Inc.,
et al.'s Chapter 11 Plan of Liquidation.
The Debtors filed on Feb. 2, 2016, a plan supplement disclosing
that a Plan Administrator to be appointed under the Plan will
receive a flat fee of $20,000 per month. The Plan calls for the
appointment on the Effective Date of Robert Moon, or another
person jointly selected by the Debtors and the Committee as Plan
Administrator. The Plan Administrator is tasked to make
distributions in accordance with the Plan.
Majority of the Debtors' assets have already been liquidated to
cash. The Debtor has $16.3 million in cash and cash equivalents.
A plan settlement provides for the resolution of two significant
disputed claims against the Debtors (The Solyndra Residual Trust's
$1.5 billion Claim and Wuxi Suntech Power Co.'s approximate $145
million Claim). The general unsecured claims of Solyndra and Wuxi
are allowed at $360,441,916 and these claimants have agreed to a
payment of $10,312,500 plus 60% of the total value of any
additional assets, for a 2.86% recovery. Holders of other general
unsecured claims totaling $6 million are slated to recover 30%.
Holders of equity interests will receive the remaining cash after
distribution to holders of allowed claims have been made.
================
H O N G K O N G
================
CHINA FISHERY: Former Sino Forest Exec Appointed as CRO
-------------------------------------------------------
Undercurrent News reports that the former CEO of fraud scandal-hit
Sino Forest Corporation has been named the chief restructuring
officer (CRO) of China Fishery Group, according to the company.
Paul Jeremy Bough was appointed CRO and executive director of
Pacific Andes International Holdings (PAIH) owned China Fishery on
Jan. 21 with effect from Feb. 26, Undercurrent News relates citng
a stock exchange alert from the company.
From January 2013-April 2015, Mr. Bough was CEO and chairman of
Emerald Plantation Holdings, parent of Sino Forest, which was
accused of a major accountancy fraud in 2011 in a report from
Muddy Waters Research, the report discloses.
Sino Forest, which was stock market listed in Canada, had its
shares suspended and ultimately filed for bankruptcy, says
Undercurrent News.
Undercurrent News relates that Mr. Bough took over as CEO of
Emerald upon filing of the restructuring plan of Sino-Forest,
pursuant to the Companies Creditors Arrangement Act of Canada on
Jan. 30, 2013.
Following filing of the plan, substantially all of the assets of
Sino Forest were transferred to Emerald. He undertook an asset
realization program for Emerald's assets, including its Hong Kong
listed subsidiary, Greenheart Group, which was disposed of in
May 2015, Undercurrent News reports citing Mr. Bough's Linkedin
profile.
Mr. Bough stepped down from Emerald after the successful disposal
of Greenheart, Emerald's largest offshore-China asset,
Undercurrent News notes.
Undercurrent News relates that PAIH also said that Ng Puay Yee,
known as Jessie, has been appointed as a CEO and executive
director of China Fishery on Jan.21, with effect from Feb. 26.
In addition, Ng Joo Thieng, one of Jessie's older brothers, has
been officially appointed to an executive role in the company, as
general manager of Peruvian subsidiary Copeinca with effect from
Feb. 26, 2016, according to Undercurrent News.
He will oversee the day-to-day business and management of
Copeinca, according to the release obtained by Undercurrent.
Ng Joo Siang and Chan Tak Hei resigned as executive directors with
effect from Jan. 21, 2016.
Consequent to Joo Siang's resignation, he has ceased as members of
the company's investment committee and the corporate social
responsibility committee.
According to the report, the official changes at the company come
after China Fishery announced, on Feb. 1, said that KPMG
executives are no longer in place as joint provisional liquidators
(JPLs), with the board of directors of the company reportedly
looking to close a sale of its Peru assets by the end of August.
In a press release and a stock exchange announcement on Feb. 1,
China Fishery, which has been downgraded to default by Standard &
Poor's Ratings Services, confirmed the winding up petitions in
Hong Kong and the Cayman Islands have been dismissed and the KPMG
JPLs are no longer running the business, Undercurrent News
relates.
On Jan. 29, the HSBC winding up petition was dismissed in
Hong Kong, after the same happened with the winding up petition in
the Cayman court on Jan. 28, Undercurrent News says.
According to a report obtained by Undercurrent News from Debt
Wire, a financial news site, Pacific Andes hopes to have the sale
of its Peruvian fishmeal and fish oil production business done by
the end of August, with a sales and purchase agreement signed in
four months.
On Jan. 25 and Jan. 26, the management of Pacific Andes Pacific
Andes Resources Development (PARD) and PAIH, respectively, held
meetings and conference calls with holders of PARD's SGD 200
million 8.5% due-2017s and China Fishery's outstanding $280.9m
9.75% due-2019s in give a sense of the timeframe of the asset
disposal, Undercurrent News recalls citing Debt Wire.
The newswire said the legal battle between the family, HSBC and
the JPLs has meant that possible buyer for the company have been
left on the sideline, adds Undercurrent News.
About China Fishery
China Fishery Group Ltd -- http://www.chinafisherygroup.com/-- is
headquartered in Hong Kong and listed in Singapore. It is engaged
in the Peruvian fishmeal and fish oil business and fishing fleet
operations. China Fishery is 46.5% effectively owned by the
Pacific Andes group through Pacific Andes International Holdings
Limited (unrated), a Hong Kong-listed integrated fish and seafood
products processor. The Carlyle Group, a global alternative asset
management firm, holds an 11.1% stake in the company.
As reported in the Troubled Company Reporter-Asia Pacific on
Feb. 3, 2016, Standard & Poor's Ratings Services said it lowered
its long-term corporate credit rating on China Fishery Group Ltd.
to 'D' from 'SD'. At the same time, S&P lowered its long-term
issue rating on the senior unsecured notes due 2019 issued by CFG
Investment S.A.C. to 'D' from 'CC'; China Fishery guarantees the
notes. S&P also lowered its long-term Greater China regional
scale ratings on China Fishery to 'D' from 'SD' and on the
outstanding notes to 'D' from 'cnCC'. China Fishery is a
Singapore-listed fishing company with operations or business in
Peruvian, African, and Russian waters.
S&P downgraded China Fishery after the company missed a coupon
payment on the US$300 million senior unsecured notes due 2019 that
China Fishery guarantees. The coupon payment of about US$14.63
million was due on Jan. 30, 2016.
CITIC RESOURCES: Moody's Lowers CFR to B1; Outlook Negative
-----------------------------------------------------------
Moody's Investors Service has downgraded CITIC Resources Holdings
Limited's corporate family rating to B1 from Ba3.
The rating outlook is negative.
This rating action concludes the rating review initiated on
Jan. 22, 2016.
RATINGS RATIONALE
"The rating downgrade reflects the material deterioration in CITIC
Resources' credit metrics and cash positions due to low prices for
oil, metal and coal," says Joe Morrison, a Moody's Vice President
and Senior Credit Officer.
In addition, Moody's believes that the market conditions for all
three commodities have moved beyond those which are part of a
cyclical downturn and that the low prices will persist over the
medium term.
The severity of the impact on CITIC Resources is reflected in its
2015 results, including (1) a 79% year-on-year decline in
revenues; (2) a gross operating loss of HKD318 million compared
with a prior-year profit of HKD938 million; and (3) a fall in
reported equity of 62% to HKD4.1 billion.
Three of its four core business segments -- aluminum smelting,
coal and crude oil -- reported operating losses in 2015.
In addition, CITIC Resources recorded substantial impairments for
its oil assets and fair value reduction on its interests in its
associated companies. This development means that the cash flow
from such resources will fall over the medium term, which will in
turn impair the company's debt-service ability.
Moody's observes that CITIC Resources' cash position is weakening
fast. It reported cash of around HKD1.3 billion at end-2015, a
60% decline from HKD3.2 billion at end-2014.
Moreover, the weak state of CITIC Resources' credit metrics means
that the company is reliant on financial support from its parent,
CITIC Group Corporation (A3 stable).
CITIC Resources' B1 corporate family rating incorporates a three-
notch uplift, reflecting the expected strong support from CITIC
Group in the event of financial distress.
The company's standalone credit strength reflects: (1) its small
scale in the exploration and production (E&P) business; (2) the
cyclical nature of its oil, metal and coal businesses; and (3) its
weak credit metrics and cash position.
The negative rating outlook reflects the consideration that the
company's financial and liquidity position could face further
deterioration while oil and metal prices remain depressed.
Upward ratings pressure is limited, given the negative rating
outlook.
Nevertheless, the rating outlook could return to stable if CITIC
Resources rationalizes its businesses to arrest operating losses
and strengthens its liquidity position through issuing additional
equity and/or disposing of assets.
On the other hand, the rating could be downgraded if: (1) CITIC
Group reduces its ownership in or financial support to CITIC
Resources; (2) banks scale down lending to CITIC Resources; or (3)
CITIC Resources misses payment obligations.
A downgrade of CITIC Group's rating would lead Moody's to revisit
its assumptions of support and hence the uplift in CITIC
Resources' ratings.
The principal methodology used in this rating was Global
Independent Exploration and Production Industry published in
December 2011.
CITIC Resources Holdings Limited is an energy and natural
resources investment holding company, with interests in aluminum
smelting; coal; import and the export of commodities; manganese;
and bauxite mining and alumina refining. It also has interests in
the exploration, development and production of oil. The company
serves as the principal natural resources and energy arm of its
parent, CITIC Group.
The Local Market Analyst for this rating is Pingping Xing, +86
(10) 6319 6561
GRUSS CAPITAL: Event-Driven Hedge Fund Manager Shutting HK Office
-----------------------------------------------------------------
Bei Hu at Bloomberg News reports that Gruss Capital Management, an
event-driven hedge fund manager based in New York, is shutting its
more than seven-year-old Hong Kong office.
Gruss filed a notification to Hong Kong's securities regulator to
cease its asset-management activities in the city from Jan. 31 and
will no longer have such staff in the office, Bloomberg relates
citing a filing to the Securities and Exchange Commission dated
Feb. 20. The firm had almost $3.2 billion of regulatory assets,
which may include leverage, as of December, according to the
filing cited by Bloomberg.
Bloomberg says the firm expects to liquidate the Hong Kong entity
and shut the physical office in the second quarter, it added,
without giving a reason for the closure. Sean Dany, Gruss's New
York-based chief investment officer, and Howard Guberman, its
chief operating officer, didn't reply to e-mails seeking comments,
Bloomberg notes. Stephen Woo, who has led the Hong Kong office,
didn't respond to a text message and couldn't be reached by phone,
according to Bloomberg.
Bloomberg states that global hedge funds have had a history of
paring back satellite offices during volatile markets or trouble
at home. Bloomberg says Pine River Capital Management in November
shuttered an Asia-focused hedge fund that it had opened in 2004,
after it failed to attract enough assets to justify keeping it
going. Grupo BTG Pactual's hedge-fund unit is closing its Hong
Kong office after being hit by redemptions since the arrest and
release of the investment bank's billionaire founder Andre
Esteves.
Event-driven hedge funds globally retreated 1.7 percent in 2015
for the biggest annual loss since 2011, and shed another 3.5
percent in January in the worst start to the year since the
collection of data began in 2000, Bloomberg discloses citing
Singapore-based Eurekahedge Pte.
"The firm will continue to monitor investment opportunities in the
Asia-Pacific region from its New York and London offices," Gruss's
SEC filing said, Bloomberg relays.
Gruss was licensed to conduct asset-management activities in
Hong Kong from October 2008, Bloomberg discloses citing
information posted on the website of the city's Securities and
Futures Commission. The hedge-fund manager invests in stocks,
bonds, loans and derivatives affected by corporate actions such as
reorganizations, liquidations and mergers, regulatory or legal
shifts, as well as market dislocations. It also invests in
distressed securities, according to the filing cited by Bloomberg.
=========
I N D I A
=========
ABHINAASH AGROFOOD: Ind-Ra Assigns 'IND B+' LT Issuer Rating
------------------------------------------------------------
India Ratings and Research (Ind-Ra) has assigned Abhinaash
Agrofood Industries Private Limited. (AAFIPL) a Long-Term Issuer
Rating of 'IND B+'. The Outlook is Stable.
KEY RATING DRIVERS
AAFIPL's ratings reflect its limited operational track record as
commercial production commenced as recently as March 2015. The
ratings also factor in the company's tight liquidity position as
average maximum utilisation was almost 100% during the last six
months ended January 2016. In addition, the ratings are
constrained by the company's small scale of operations as
reflected in its revenue of INR3m along with negative interest
coverage (Operating EBITDA/Gross interest expense) of 0.3x and
negative net leverage (Total adjusted net debt/Operating EBITDAR )
of 323.8x in 2015.
The ratings are supported by the promoter's over two-decade-long
experience in the trading business.
RATING SENSITIVITIES
Positive: A substantial improvement in the scale of operations
along with an improvement in the credit metrics will be positive
for the ratings.
Negative: Any deterioration in the credit metrics will be negative
for the ratings.
COMPANY PROFILE
AAFIPL was incorporated in 2014 and commenced commercial
operations in March 2015. The company has a rice milling capacity
of 18,000 tonnes per annum in Jharkhand. AAIFPL caters to both
domestic as well as overseas markets.
AAFIPL's ratings:
-- Long-Term Issuer Rating: assigned 'IND B+'; Outlook Stable
-- INR30 million fund-based working capital limits: assigned
'IND B+'; Outlook Stable
-- INR38.75 million term loans: assigned 'IND B+'; Outlook Stable
AJANTA GARTEX: CRISIL Assigns B Rating to INR75MM Term Loan
-----------------------------------------------------------
CRISIL has assigned its 'CRISIL B/Stable' rating to the long term
bank facilities of Ajanta Gartex Processors Private Limited
(AGPPL). The rating reflects AGPPL's small scale of operations in
a highly fragmented industry and its working capital intensive
operations. These weaknesses are partially offset by the extensive
experience of AGPPL's promoters in the textile industry.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Working Capital
Facility 7 CRISIL B/Stable
Proposed Long Term
Bank Loan Facility 8 CRISIL B/Stable
Term Loan 75 CRISIL B/Stable
Outlook: Stable
CRISIL believes AGPPL will continue to benefit over the medium
term from the promoters' extensive industry experience. The
outlook may be revised to 'Positive' if AGPPL improves its working
capital management or increases its scale of operations on a
sustainable basis while maintaining its profitability margin.
Conversely, the outlook may be revised to 'Negative', if the
company's liquidity deteriorates because of stretched working
capital cycle or if AGPPL's scale of operations or profitability
declines, leading to significantly low cash accruals or if there
is a significant time of cost overrun in the present project.
AGPPL, incorporated in April 2005 is an Uttar Pradesh based
company promoted by Sh. Rajender Kumar Chindalia and Sh. Babu Lal
Daga. AGPPL is engaged in the processing and dyeing of fabric and
garments. The plant of AGPPL is located in Ghaziabad District,
U.P., having built up on an area of 10,000 square feet
approximately. The manufacturing facility is owned by a group
partnership firm in which Shri Babu Lal Daga is a partner. The
company is paying rent to the partnership firm for using the said
facility.
AL-RKAYAN APPARELS: ICRA Reaffirms B+ Rating on INR25cr Loan
------------------------------------------------------------
ICRA has reaffirmed the long term rating of [ICRA]B+ for INR28.00
Cr (enhanced from INR19.28 crores) long term fund based facilities
of Al-Rkayan Apparels & Exports Private Limited.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Fund Based Limits
(Term Loans) 3.0 [ICRA]B+ re-affirmed
Fund Based Limits
(Cash Credit) 25.0 [ICRA]B+ re-affirmed
The rating reaffirmation takes into account the long experience of
promoters in the denim manufacturing industry. The revenues of the
company have reported a strong growth in FY2015 driven by healthy
order inflows for contract manufacturing from its existing
customers and new customers. The rating also favorably factors in
the strong tie-ups of the company with its key customers, which
include established denim players.
The rating is, however, constrained due to weak financial profile
of company characterized by high gearing levels and lower
profitability margins which have led to relatively weak interest
and debt coverage indicators. The company's liquidity position
continues to be strained as illustrated by its almost-full
utilization (95%-100%) of fund based working capital limits during
the last twelve months. The rating also takes into account high
competitive intensity in denim manufacturing industry and
vulnerability of the company's profitability to adverse movements
in cotton yarn prices which may not be fully passed on to
customers.
Al-Rkayan was incorporated in 2004 by Mr. Prabhakar Shetty,
Mr.Shahid Rafi and Mr. Abdul Rahman S Al-Rkayan. The company is
primarily involved in manufacturing of denims for major denim
players and has manufacturing facility in Goregaon, Mumbai which
is spread over 30,000 sq feet and employs over 650 people under
one roof. Towards the end of 2008-09, Al-Rkayan launched its own
denim brand Leonidas, aimed at the price-sensitive and fashion
conscious youth segment (16 to 40 years age group); Leslie (for
capris and three-fourths) and LD Active (bottom wear for women).
Recent Results
As per audited results for FY 2015, Al-Rkayan reported a profit
after tax (PAT) of INR0.80 crore over an operating income of
INR139.77 crore as against a PAT of INR0.62 crore on an OI of
INR80.6 crore in FY 2014.
ALVA'S EDUCATION: ICRA Reaffirms B+ Rating on INR106cr Loan
------------------------------------------------------------
ICRA has reaffirmed the long term rating of [ICRA]B+ to the
INR106.0 crore long term limits of Alva's Education Foundation.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Fund Based-Term Loan 106.0 [ICRA]B+ reaffirmed
The rating reaffirmation continues to be constrained by the
significant debt-funded capital expenditure incurred towards
expansion of infrastructure facility which exerts pressure on the
debt protection metrics of the trust. ICRA also takes into account
the risk of cash flow mismatch during the year with different fee
collection frequency for each institute which may pose the risk of
short-term liquidity mismatches. Moreover, the rating continues to
take into consideration the concentration risk arising of the fact
that ~76% of the fee generation is accounted by ayurveda,
engineering and pre- university courses. Also, the revenue growth
and the profitability of the trust remain exposed to the
persisting high competitive intensity in the region and strong
regulatory controls in the education sector which may restrict its
flexibility to increase fees and student strength. Going forward,
the ability of the trust to effectively manage its cash flow
mismatch will remain the key rating sensitivity.
The rating however, derives comfort from significant growth in the
operating income and internal accruals of the trust during 2014-
15, driven by increase in the number of students admitted and
increase in fee structure. In addition, the rating takes into
consideration the regular investment by the trust in the
infrastructure and accreditations which has helped in regular
increase in new admissions, especially for the Pre University and
the Degree College. Further, the rating continues to favourably
factor in the long track record of the trust in education sector
with established presence of seventeen institutions offering wide
varieties of courses /programs.
Established in 1995, Alva's Educational Foundation (AEF) is an
education trust offering courses/programs in various disciplines.
Its institutes are situated in Moodabidri, a town adjacent to
Mangalore, Karnataka. Currently, AEF operates 17 institutes
offering more than 30 courses in various disciplines like
ayurveda, nursing, physiotherapy, naturopathy, engineering, pre-
university colleges, high school etc. Many of the colleges are
resident type and the infrastructure facilities include an
auditorium, common canteens, sports facilities, libraries,
laboratories and hostels. The various courses offered by AEF are
affiliated to Mangalore University, Rajiv Gandhi University of
Heath and Science, Visveswaraya Technological University, PU Board
and Nursing Council of Karnataka.
AMRIT POLYCHEM: ICRA Assigns B+ Rating to INR12cr Cash Loan
-----------------------------------------------------------
ICRA has assigned a long term rating of [ICRA]B+ to the INR12.00
crore fund based cash credit limit and a short term rating of
[ICRA]A4 to the INR20.00 crore non-fund based letter of credit
limit of Amrit Polychem Pvt. Ltd.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Fund Based Cash
Credit 12.00 [ICRA]B+; assigned
Non Fund Based
Letter of credit 20.00 [ICRA]A4; assigned
The ratings assigned to Amrit Polychem Pvt. Ltd. (APPL) takes into
account low net profitability due to trading nature of business
resulting in weak debt protection metrics and coverage indicators.
Being an importer of polyurethane chemicals which are crude oil
derivatives, the company's revenues remain vulnerable to the
highly volatile prices of products and rupee depreciation in the
absence of any formal hedging mechanism. The ratings are also
constrained by the leveraged capital structure of the company;
however some comfort is drawn as 45-50% of the total debt is
constituted by interest free unsecured loans. The ratings also
take into note of slow debtors realization as evident from ~32% of
the total debtors outstanding for over six months owing to liberal
credit terms offered to customers as a result of stiff competition
from large number of manufactures and traders engaged in the
manufacturing and trading of chemicals used for the production of
polyurethane.
The ratings, however, positively reflect the extensive experience
of the key promoter in the chemical industry which has facilitated
established association of over a decade with overseas suppliers
for supply of chemicals and a fairly diversified customer base
comprising of reputed plastic products manufacturers,
pharmaceutical giants, among others. The ratings also draw comfort
from the steady growth in operating income as a result of
increasing trading volumes attributable to the diverse
applications of polyurethane; which is a principal trading product
for APPL. Since the traded products are crude oil price
derivatives, the ability of the company to maintain and improve
its profit margins and limit risk of inventory losses in the
current scenario of falling crude oil prices, would be critical
from the credit perspective.
Established in 1979 as a partnership firm, Amrit Chem was
converted into a private limited company in March 2012 in the name
of Amrit Polychem Pvt. Ltd. (APPL). Mr. Hemal Parekh and Mr.
Mukesh Bakhai are the key managing personnel who look after the
overall operations of the company. APPL is engaged in the business
of manufacturing of polyol and trading in chemicals used for the
manufacturing of polyurethane, plastics, paints, inks and
coatings. The company has its head office in Mumbai, factory in
Palghar and 3 sales depots in Ahmedabad, Daman and Haryana.
Recent Results
Amrit Polychem Pvt. Ltd. has reported a net profit after tax of
INR0.80 crore on an operating income of INR135.46 crore for the
year ending March 31, 2015.
ARYAN MINING: Ind-Ra Downgrades 'IND B' Long-Term Issuer Rating
----------------------------------------------------------------
India Ratings and Research (Ind-Ra) has downgraded Aryan Mining &
Trading Corporation Pvt. Ltd.'s (India) (AMTC) Long-Term Issuer
Rating to 'IND B'/Negative from 'IND BBB+'/Rating Watch Evolving.
Ind-Ra has taken a consolidated view on AMTC and its 100%
subsidiary being Brahmani River Pellets Ltd. (BRPL; 'IND D') as
there are strong operational, strategic and legal linkages between
them. The legal linkages comprise AMTC's shortfall undertaking for
BRPL's term loans and a guarantee for BRPL's INR1,262.6m non-
convertible debentures.
AVVAS INFOTECH: ICRA Suspends 'D' Rating on INR17.5cr Loan
----------------------------------------------------------
ICRA has suspended the long term rating of [ICRA]D assigned to
INR17.50 crore fund based limits and INR12.50 crore non-fund based
limits of Avvas Infotech Private Limited. The suspension follows
ICRA's inability to carry out a rating surveillance in the absence
of the requisite information from the company.
According to its suspension policy, ICRA may suspend any rating
outstanding if in its opinion there is insufficient information to
assess such rating during the surveillance exercise.
Avvas Infotech private Limited (AIPL), incorporated in 2007 by Mr.
A. V. S. Sarma, provides IT services, ITES services and HR
services. AIPL services include implementation of Enterprise
Resource Planning (ERP) solutions, IT infrastructure services,
matrimonial services portal and egovernance services. The company
is also into development of IT products; school portal which
contains different modules. AIPL has partnered with leading IT
companies and is involved in the sales of their products. The
company is also engaged in trading of hardware components. AIPL
also provides staff augmentation services i.e., provides staff to
various companies to meet their IT solutions requirements. AISL
has centres at Bangalore, Hyderabad, Vijayawada, Delhi, Pune,
Kolkata, Guntur and Tirupathi.
BHAGWATI DIAMONDS: CRISIL Assigns 'B+' Rating to INR115MM Loan
--------------------------------------------------------------
CRISIL has assigned its 'CRISIL B+/Stable' rating to the bank
facility of Bhagwati Diamonds Private Limited (BDPL).
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 115 CRISIL B+/Stable
Crisil ratings reflect weak financial structure driven by its
below average financial risk profile, low net worth, high gearing
and weak debt protection metrics because of low operating margins.
These rating weaknesses are partially offset by BDPL's promoter's
extensive experience in the industry and their established
relationship with their major customer base.
Outlook: Stable
CRISIL believes that Bhagwati Diamonds Private Limited (BDPL))
will continue to have a stable business profile over the medium
term backed by its established market position in Delhi and
Haryana. Company financial profile is expected to remain weak on
the back of high gearing levels & low net worth. The outlook may
be revised to positive in case of significant improvement in
capital structure through equity infusion, better than anticipated
cash accruals resulting in a healthy financial risk profile.
Conversely, any major capex plans requiring significant debt
funding and lower than expected profitability would exert negative
pressure on the ratings.
Bhagwati Diamonds Private Limited (BDPL) is a Delhi based company,
established and promoted in 2007 by Mr. Sanjay Kumar, Mr Suresh
Kumar and Mr. Anuj Garg. BDPL is engaged into manufacturing and
supplying of diamond and gold studded jewellery to its customer
base in Delhi and Haryana.
BDPL reported net profit of INR3.5 million on net sales of
INR741.4 million in FY 2014-15 against net profit of INR3.6
million on net sales of INR696.4 million in FY 2013-14.
BORAH AUTOMOBILES: CARE Revises Rating on INR12.18cr Loan to B+
---------------------------------------------------------------
CARE revises the lt rating and reaffirms the st rating assigned to
the bank facilities of Borah Automobiles Pvt. Ltd.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long term Bank Facilities 12.18 CARE B+ Revised from
CARE B
Short term Bank Facilities 0.10 CARE A4 Reaffirmed
Rating Rationale
The revision in the rating of Borah Automobiles Pvt. Ltd (BAPL)
takes into cognizance improvement in the financial risk profile in
FY15 (refers to the period April 01 to March 31) vis-a-vis FY14
marked by improvement in total operating income, profitability
margin and capital structure. However, the rating continues to be
constrained by its relatively small size of operation and short
track record of operation, risk of non-renewal of dealership
agreement from Tata Motors Ltd. (TML), linkage to the fortunes of
Tata Motors Ltd, pricing constraints and margin pressure arising
out of competition from other auto dealers in the market, working
capital intensive nature of operation and high leverage ratio. The
rating, however, continues to draw comfort from the experience of
the promoter, sole authorized dealer of Tata Motors Limited for
three districts of Assam and integrated nature of business.
Going forward, the ability of the entity to improve its scale of
operations along with profit margins and effective working capital
management would be the key rating consideration.
Borah Automobiles Private Limited (BAPL) was incorporated in May,
2011 by Mr Manash Protim Konwar of Dibrugarh, Assam. The company
commenced operations from March, 2012 as an authorized dealer of
Tata Motors Ltd (TML) for its commercial vehicles (like 'Magic
Iris', 'Ace', 'Winger', 'Venture' '207DI', etc.), spares &
accessories in Dibrugarh (Assam). BAPL has its main commercial
vehicles showroom at Dibrugarh (Assam) where it also provides
repair and refurbishment services for TML commercial vehicles.
Besides, the company has small showrooms in rented premises
in the districts of Assam which include Tinsukia & Sivasagar.
BRAHMANI RIVER: Ind-Ra Cuts Long-Term Issuer Rating to 'IND D'
--------------------------------------------------------------
India Ratings and Research (Ind-Ra) has downgraded Brahmani River
Pellets Limited's (BRPL) Long-Term Issuer Rating to 'IND D' from
'IND BBB-'/Rating Watch Evolving.
The agency has also downgraded the company's INR5,350m long-term
loans (outstanding on 1 September 2015; reduced from INR8,400m) to
'IND D' from 'IND BBB-'/Rating Watch Evolving. Ind-Ra has also
downgraded BRPL's INR1,262.6m (increased from proposed INR1,250m)
non-convertible debentures' 'Provisional IND BBB+(SO)'/Rating
Watch Evolving and assigned a final rating of 'IND
B(SO)'/Negative.
BRAMHACORP HOTELS: Ind-Ra Withdraws 'IND B+' LT Issuer Rating
-------------------------------------------------------------
India Ratings and Research (Ind-Ra) has withdrawn Bramhacorp
Hotels & Resorts Ltd (BHRL) 'IND B+(suspended)' Long-Term Issuer
Rating. A full list of rating actions is at the end of this
commentary.
The ratings have been withdrawn due to lack of adequate
information. Ind-Ra will no longer provide ratings or analytical
coverage for BHRL. Ind-Ra suspended BHRL's ratings on 5 December
2012.
BHRL's ratings are as follows:
-- Long-Term Issuer Rating: 'IND B+(suspended)'; rating
withdrawn
-- INR450 million fund-based limits: 'IND B+(suspended)'; rating
withdrawn
-- INR1,450 million term loan: 'IND B+(suspended)'; rating
Withdrawn
CHINTAMANI JEWELS: ICRA Suspends B+ Rating on INR8cr Loan
---------------------------------------------------------
ICRA has suspended the long term rating of [ICRA]B+ outstanding on
the INR8.00 Crore fund based bank facilities of Chintamani Jewels.
ICRA has also suspended the short term rating of [ICRA]A4
outstanding on the INR8.00 Crore non-fund based sub limits of the
entity. The suspension follows ICRA's inability to carry out a
rating surveillance in the absence of the requisite information
from the company.
DELTRONIX INDIA: Ind-Ra Suspends 'IND D' Long-Term Issuer Rating
----------------------------------------------------------------
India Ratings and Research (Ind-Ra) has migrated Deltronix India
Limited's (DIL) 'IND D' Long-Term Issuer Rating to the suspended
category. This rating will now appear as 'IND D(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 DIL.
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.
DIL's ratings are as follows:
-- Long-Term Issuer Rating: migrated to Long-term 'IND
D(suspended)' from 'IND D'
-- INR246 million fund-based limits: migrated to Long-term and
Short-term 'IND D(suspended)' from 'IND D'
-- INR100 million Non-fund-based limits: migrated to Long-term
and Short-term 'IND D(suspended)' from 'IND D'
-- INR439.4 million Long-term loans: migrated to Long-term 'IND
D(suspended)' from 'IND D'
EQUIPLUS (INDIA): ICRA Suspends B+ Rating on INR11.25cr Loan
------------------------------------------------------------
ICRA has suspended its long-term rating of [ICRA]B+ and short-term
rating of [ICRA]A4 assigned to the INR11.25 crores bank facilities
of Equiplus (India) Exports Private Limited. The suspension
follows ICRA's inability to carry out a rating surveillance in
absence of requisite information from the company.
FASHION FLARE: ICRA Revises Rating on INR2cr Term Loan to B+
------------------------------------------------------------
ICRA has revised its long-term rating on the INR3.00 crore long-
term fund based facilities of Fashion Flare International Private
Limited to [ICRA]B+ from [ICRA]BB-. ICRA has also reaffirmed its
short-term rating of [ICRA]A4 on the INR10.00 crore fund-based
bank facilities and INR1.00 crore non fund-based bank facilities
of FFIL.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Term Loan 2.00 [ICRA]B+; Revised
Fund-based bank
facilities 10.00 [ICRA]A4; Reaffirmed
Non fund-based bank
facilities 2.00 [ICRA]A4; Reaffirmed
The rating revision is driven by the decline in FFIL's operating
margin to 4.43% in FY15, from 6.68% in the previous year, coupled
with moderation in sales which resulted in relatively lower cash
profits. The company has significant repayments owing to the fresh
loans availed in the recent past, which is likely to keep the
liquidity under pressure. The ratings are also constrained by the
high working capital intensity of the business as reflected in
NWC/OI* of 52%. ICRA also notes that the company's modest scale of
operations coupled with high customer and geographic
concentration, which accentuates the vulnerability of the firm's
revenues to any slowdown in demand from these customers.
However, the ratings derive comfort from the promoters' extensive
experience in the garmenting industry and the company's
established relations with its key customers, which have resulted
in repeat orders. Also, the company has been able to make in-roads
into new geographies which is expected to reduce its risk of
geographic concentration.
Going forward, the company's ability to achieve a sustained growth
in scale and improvement in its profitability, while optimally
managing its working capital cycle, will be the key rating
sensitivities.
Incorporated in 1998, FFIL manufactures and exports woven and
knitted readymade garments, primarily for women. The company
currently operates a unit in Delhi which has a capacity to
manufacture ~8.4 lakh garment pieces per year. The company's key
markets are European countries like France and United Kingdom.
Recent results
FFIL reported an Operating Income (OI) of INR26.59 crore and a
Profit after Tax (PAT) of INR0.00 crore in 2014-15 as compared to
an OI of INR27.29 crore and a PAT of INR0.50 crore in the previous
year.
FORTUNE CARS: CARE Revises Rating on INR15cr Loan to B+
-------------------------------------------------------
CARE revises the ratings assigned to the bank facilities of
Fortune Cars Private Limited.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank Facilities 15.00 CARE B+ Revised from
CARE B
Rating Rationale
The revision in the rating assigned to the bank facility of
Fortune Cars Private Limited (FCPL) takes into consideration the
increase in scale of operations, improvement in profit margins
during FY15 (refers to the period April 1 to March 31) and
infusion of equity capital during 9MFY16.
The rating however, continues to be constrained by the volume-
driven nature of auto dealership business with low profit margin,
fluctuating operational performance, weak debt coverage indicators
and working capital intensive nature of operations. The rating is
further constrained by intensive competition amongst dealers and
the company's fortunes being linked to Tata Motors Limited (TML).
The rating is however, strengthened by the established track
record of the promoters in the automobile dealership along with
their demonstrated financial support and over a decade long
association with the TML.
Going forward, the ability of the company to continue to increase
its scale of operations along with improvement in operational
performance and capital structure along with efficiently manage
working capital requirements are the key rating sensitivities.
Fortune Cars Private Limited (FCPL), incorporated in November,
1996 was co-founded by Mr Vinod Sharma, Mr. R. P. Mungrikar, Mr.
S. Premkumar and Mr. N. Subramanium. During 1996-2000, FCPL
was authorized dealer for DAEWOO Motors Limited for selling
passenger cars. Since July 2000, FCPL became authorized dealer for
TATA Motors Limited (TML) for selling passenger vehicles such as
Indica, Indigo, Nano, UV and Fiat in Mumbai, Thane and Raigadh
district. Besides, it is engaged in the servicing of vehicles and
sale of spare parts for TML. FCPL is amongst the leading dealers
for TML in Mumbai.
G. N. PET: CRISIL Lowers Rating on INR35.5MM Term Loan to D
-----------------------------------------------------------
CRISIL has downgraded its rating on the long-term bank facilities
of G. N. Pet (GNP; part of the GN group) to 'CRISIL D' from
'CRISIL C'.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 25 CRISIL D (Downgraded from
'CRISIL C')
Funded Interest 13.7 CRISIL D (Downgraded from
Term Loan 'CRISIL C')
Proposed Long Term 0.2 CRISIL D (Downgraded from
Bank Loan Facility 'CRISIL C')
Term Loan 35.5 CRISIL D (Downgraded from
'CRISIL C')
Working Capital 25.6 CRISIL D (Downgraded from
Term Loan 'CRISIL C')
The downgrade reflects recent instances of delay by the GN group
in meeting debt obligation due to weakened liquidity because of
significant stretch in receivables.
The GN group also has a weak financial risk profile because of
poor debt protection metrics and high gearing, small scale of
operations in the intensely competitive packaging industry, and
large working capital requirement.
For arriving at its rating, CRISIL has combined the business and
financial risk profiles of Garib Nawaz Polymers Private Limited
(GNPPL) and GNP. This is because the two entities, together
referred to as the GN group, are in the same line of business,
have close operational and financial linkages, and are under a
common management.
GNPPL, set up in 2007 by Mr. Sunil Bansal, manufactures
polyethylene terephthalate bottles for consumers in the
pharmaceuticals industry. It commenced commercial operations in
2008. In 2009, Mr. Bansal set up proprietorship concern GNP, which
is in the same line of business and commenced commercial
operations in 2011. Both entities' manufacturing facilities are in
Baddi.
GROVER ZAMPA: CRISIL Assigns B Rating to INR116MM Cash Loan
-----------------------------------------------------------
CRISIL has revoked the suspension of its ratings on the bank
facilities of Grover Zampa Vineyards Limited (GZVL) and has
assigned its 'CRISIL B/Stable/CRISIL A4' ratings to the
facilities. The ratings were previously Suspended by CRISIL
(Rating Rationale dated February 28, 2013) since GZVL had not
provided the necessary information required for a rating review.
GZVL has now shared the requisite information enabling CRISIL to
assign the ratings.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Bank Guarantee 40 CRISIL A4 (Assigned;
Suspension Revoked)
Cash Credit 116 CRISIL B/Stable (Assigned;
Suspension Revoked)
Foreign Bill 12.5 CRISIL B/Stable (Assigned;
Discounting Suspension Revoked)
Proposed Long Term 5.0 CRISIL B/Stable (Assigned;
Bank Loan Facility Suspension Revoked)
Short Term Loan 26.5 CRISIL A4 (Assigned;
Suspension Revoked)
The ratings reflect GZVL's continuous cash losses that constrain
the financial risk profile. The ratings also factor in its
exposure to intense competition and government regulation in the
wine-making industry. These weaknesses are partially offset by the
extensive experience and track record of the promoters in the
industry and expected private equity (PE) funding to support
liquidity over the near term.
For arriving at the rating, CRISIL has treated unsecured loans of
INR35.2 million as on March 31, 2015 extended by promoters to
GZVL, as neither debt nor equity. This is because these loans bear
nominal interest, and are expected to be retained in the business
over the medium term.
Outlook: Stable
CRISIL believes GZVL will continue to benefit over the medium term
from the promoters' extensive industry experience. The outlook may
be revised to 'Positive' if sales increase significantly and
break-even is achieved earlier than expected leading to better
profitability. Conversely, the outlook may be revised to
'Negative' if the financial risk profile, particularly liquidity,
weakens because of a delay in the receipt of PE funding, stretch
in the working capital cycle, or any unanticipated debt-funded
capital expenditure.
GZVL was formed by the merger of Vallee de Vin (VDV) with Grover
Vineyards Ltd (GVL) in April 2013. The company manufactures wines
and its vineyards are located in Nandi hills near Bengaluru and
Nashik (Maharashtra).
GVL was established in 1988 by Mr. Kanwal Grover and sells its
wines under the Grover brand.
VDV was set up in 2006 by Mr. Ravi Jain and sells its wines under
the Zampa brand.
GUPTA GLOBAL: CRISIL Assigns 'D' Rating to INR1.41BB LT Loan
------------------------------------------------------------
CRISIL has assigned a rating of 'CRISIL D/CRISIL D' for the bank
facilities of Gupta Global Resources Pvt Ltd (GGRPL).
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Working Capital
Term Loan 1004 CRISIL D
Proposed Long Term
Bank Loan Facility 1415.2 CRISIL D
Letter of Credit 538.6 CRISIL D
Funded Interest
Term Loan 220.4 CRISIL D
Bank Guarantee 213 CRISIL D
Cash Credit 148 CRISIL D
The rating reflects, instances of delays by GGRPL in servicing its
term debt obligations.
GGRPL has below average financial risk profile marked by its weak
debt protection metrics. GGRPL is also exposed intense competition
and has large working capital requirements. These rating
weaknesses are partially offset by the extensive experience of
GGRPL's promoters in the coal washing industry.
Incorporated in 2001, GGRPL is engaged in the business of coal
washing and coal trading. It is a closely held company promoted by
Mr. Padmesh Gupta.
Presently, this Company has 8 state-of-the-art Coal Washeries,
located in the State of Maharashtra & Madhya Pradesh,
Chhattisgarh, Jharkhand and Andhra Pradesh. It has a capacity of
38.75 million per annum.
H.L. PASSEY: Ind-Ra Suspends 'IND BB' Long-Term Issuer Rating
-------------------------------------------------------------
India Ratings and Research (Ind-Ra) has suspended H.L.Passey
Engineering Pvt Ltd's (HLPEPL) Long-Term Issuer Rating of 'IND BB'
with a Stable Outlook. The rating will now appear as 'IND
BB(suspended)' on the agency's website. A full list of rating
actions is at the end of the 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 HLPEPL.
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.
HLPEPL's ratings are as follows:
-- Long-Term Issuer Rating: migrated to 'IND BB(suspended)' from
'IND BB'/Stable
-- INR55.00 million fund-based limits: migrated to 'IND
BB(suspended)' from 'IND BB'
-- INR35.00 million non-fund-based working capital limits:
migrated to 'IND A4+(suspended)' from 'IND A4+'
HAJI ALIMOHAMED: ICRA Reaffirms B+ Rating on INR12cr Loan
---------------------------------------------------------
ICRA has reaffirmed/assigned the [ICRA]B+ rating to the INR12.00
crore working capital facility and INR1.10 crore term loan
facility of Haji Alimohamed Moosa & Co. ICRA has also reaffirmed
an [ICRA]A4 rating to INR0.50 crore short-term forward contract
limit of HAMC.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Working Capital
(CC/EPC/FBD/FBP) 12.00 [ICRA]B+; Reaffirmed
Term loan 1.10 [ICRA]B+; Assigned
CEL of PFE 0.50 [ICRA]A4; Reaffirmed
The ratings continue to be constrained by Haji Alimohamed Moosa &
Co's (HAMC) weak financial position as is evident in the thin
profitability, moderate capital structure and weak debt protection
indicators. The rating is further constrained by highly
competitive and fragmented industry structure due to low entry
barriers. The rating further incorporates the susceptibility of
the cotton prices to seasonality and regulatory risks which
together with the highly competitive industry environment exerts
more pressure on the margins. ICRA also notes that Haji Alimohamed
Moosa & Co. is a partnership firm and any significant withdrawals
from the capital account will affect its net worth and thereby the
gearing levels.
The ratings, however, continue to factor in the long standing
experience of the promoters in the cotton industry, established
track record of the firm and strategic location, giving it easy
access to high quality raw cotton.The ratings also consider the
forward integration in crushing facilities for castor seeds and
cottonseeds resulting in some diversification.
Haji Alimohamed Moosa & Co. was initially established as a sole
proprietor concern by Mr. Adambhai A. Halai in the year 1959.
Subsequently, in October 2004, the sole proprietor firm was
converted into partnership firm constituted by three partners Mr.
Admabhai A. Halai and his two sons Mr. Aslam Halai and Mr.
Noormohamed Halai to engage in the business of ginning of raw
cotton and crushing of cottonseeds and castor seeds to produce
cotton bales, cottonseeds oil, oil cakes, castor seeds oil and
castor seeds oil cake. The firm is also engaged in trading of
cotton products and agro products. The manufacturing plant of the
firm is currently equipped with 24 ginning machines and 5
expellers having intake capacity of producing 300 FP cotton bales
per day and 4500 MT cottonseeds oil and 6000 MT castor seeds oil
per annum respectively.
The manufacturing unit of the firm is set up at Junagadh, Gujarat
to produce cotton bales and cottonseeds. The plant of the firm
normally operates for 7 months starting from October to April.
However, depending on market condition and on occasional cases the
commercial operation remains more than 7 months. The manufacturing
facility of the firm generally remains closed during monsoon
season.
Recent Results
For the year ended 31st March, 2015, the firm reported an
operating income of INR73.51 crore with profit after tax (PAT) of
INR0.71 crore.
HALCYON LIFE: ICRA Suspends 'D' Rating on INR40.5cr Loan
--------------------------------------------------------
ICRA has suspended [ICRA]D rating assigned to the INR40.5 Crore
bank facilities of Halcyon Life Sciences Private Limited. The
suspension follows ICRA's inability to carry out a rating
surveillance in the absence of the requisite information from the
company.
INCOM CABLES: Ind-Ra Assigns 'IND BB+' Long-Term Issuer Rating
--------------------------------------------------------------
India Ratings and Research (Ind-Ra) has assigned Incom Cables
Private Limited (INCOM) a Long-Term Issuer Rating of 'IND BB+'.
The Outlook is Stable.
KEY RATING DRIVERS
The ratings reflect INCOM's tight liquidity as evident from its
full utilisation of the working capital limits during the 12
months ended January 2016. Cash flow from operations and free cash
flows had also been negative since FY12 due to large working
capital requirements and high interest obligations. However,
INCOM's net working capital cycle improved to 99 days in FY15
(FY14: 153 days) due to lower inventory days of 151 (205) and
higher receivable days of 28 (42). Ind-Ra expects the liquidity
to be comfortable in the medium term based on a further
improvement in the working capital cycle and on the absence of
major capex after FY16.
The ratings factors in INCOM's consistent revenue growth over
FY13-FY15 at a CAGR of 72.4% on the back of increased capacity and
business diversification as the company forayed into manufacturing
of low tension cross-linked polyethylene cables and low tension
polyvinyl chloride cables. Also, INCOM's earnings from the railway
which is its largest customer and contributed over 55% to the
overall revenue in FY15, are consistent. INCOM is a 'PART 1'
vendor for Indian Railways.
The margins of the company have been stable (FY13-FY15: 10%-12%)
due to the high entry barriers in the industry including
technology intensive nature of the business, and INCOM's
established track record of over three decades and high customer
stickiness.
The ratings factor in the company's comfortable credit metrics.
Net financial leverage (net debt/operating EBITDA) was 2.11x in
FY15 and gross interest coverage was 2x. Ind-Ra expects the
company's financial profile to remain comfortable over the medium
term in the absence of any major debt-funded capex plan after
FY16.
The ratings also factor in INCOM's strong relations with its
principal customers including Indian Railways, NTPC Limited ('IND
AAA'/Stable) and Bharat Heavy Electricals Limited ('IND
AAA'/Stable). INCOM also caters to private companies including
Larsen & Toubro Limited and Ansaldo STS Transportation. The
promoters of the company have experience of over 15 years in the
same line of business.
INCOM is incurring capex towards setting up two new plants to
increase the installed capacity, and for the modernisation of the
in-house production facilities. The capex has entailed a total
investment of INR80 million in FY16 year to date and is being
funded by internal accruals. The company does not have any plan of
major capex after FY16 since adequate capacity will be available
for future operations.
RATING SENSITIVITIES
Negative: Deterioration in the profitability and any unexpected
debt-led capex leading to the net leverage above 3.25x will be
negative for the ratings.
Positive: An improvement in the overall liquidity and/or a
significant improvement in the overall revenue while profitability
being maintained or improving leading to the net leverage below
2.25x will be positive for the ratings.
COMPANY PROFILE
Incorporated in 1979, INCOM manufactures telecommunication,
signalling and power cables, and sells them under the brand name
of INCOM. The product mix includes different types of electric
wires, power cables, control cables, low tension cables, railway
signalling cables, railway quad cables and telephone cables. INCOM
has a manufacturing unit in Sikandarabad, Uttar Pradesh. INCOM is
an ISO 9001:2008 certified company and is approved by the Research
Design and Standards Organization as a Part 1 supplier of cables
to Indian Railways. The company also has regulatory approvals from
various state electricity boards.
INCOM's ratings are as follows:
-- Long-Term Issuer Rating: assigned 'IND BB+'; Outlook Stable
-- INR425 million fund-based limits: assigned Long-term 'IND
BB+'/Stable and Short-term 'IND A4+'
-- INR425 million non-fund-based limits: assigned Short-term
'IND A4+'
-- INR60.6 million long-term loans: assigned Long-term 'IND
BB+'/Stable
INDIAN CANE: CARE Lowers Rating on INR253.49cr LT Loan to D
-----------------------------------------------------------
CARE revises the ratings assigned to the bank facilities of
Indian Cane Power Limited.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank Facilities 253.49 CARE D Revised
Term Loan from CARE BB+
Long-term Bank Facilities 120.00 CARE D Revised
Fund-based from CARE BB+
Short-term Bank Facilities 2.50 CARE A4 Revised
Non-fund-based from CARE A4+
Rating Rationale
The revision in the rating is on account of the on-going delays in
debt servicing largely on account of the subdued demand for sugar
as well as high cost of inventory limiting the company to make
profits in the sugar division. The rating also factors in the
moderation in the profitability and debt coverage indicators
during FY15 (refers to the period April 1 to March 31) and delay
and cost overrun in expansion project undertaken though the
capacity stands commissioned.
Incorporated in 2002, Indian Cane Power Ltd (ICPL) began
operations in 2008 under the present promoters with an
integrated 5000 TCD of Sugarcane and 28 MW of Cogen at Uttur in
the Mudhol Taluk of Northern Karnataka. ICPL also took over Samson
Distilleries Pvt Ltd in 2008, a debt free company with a capacity
of 60 KLPD then. The capacity was subsequently enhanced to 90
KLPD. In a recent expansion, the sugar capacity has been increased
to 12000 TCD as on October 2014. However, the capacity utilization
was constraint at maximum crushing of 10,000 TCD for sugar season
2014-15 on account non-availability of cogen boilers for required
steam generation. Following commissioning of 78MW cogen in
November 2015 though with a delay, the sugar plant was fully
operational running at 100% capacity utilization.
The project was set up at a cost of INR361.13 crore from earlier
envisaged cost of INR338.62 crore. The project cost was funded out
of INR217.04 crore of debt, internal accruals of INR114 crore and
the balance amount is yet to be paid being retention money.
Mr S S Mallikarjun is the Chairman and Managing Director, who is
assisted by a team of General Managers heading various departments
including finance, cane department, sugar & cogen and accounts.
Credit Risk Assessment
Deterioration in financial risk profile and delays in interest
servicing ICPL reported a total operating income of INR436 crore
in FY15 as against INR369 crore in FY14. However, the
profitability of the company declined significantly in FY15 as
compared to FY14, as average sugar realization declined even as
cane cost increased considerably. The PBIDT margin declined from
20% in FY14 to 11.6% in FY15. This coupled with rise in interest
expense lead to low PBT of INR6 crore in FY15 as against INR16
crore in FY14. During FY15, the company registered a before tax
loss of INR4.24 crore from the sugar division on account of the
company recording the loss from high cost inventory in FY15.
Overall gearing deteriorated from 2.01x as onMarch 31, 2014 to
3.25x as onMarch 31, 2015 mainly on account of the higher bank
borrowings as well as intake of fresh long term loans in FY15. As
on September 30, 2015, gearing further increased to 3.33x. Total
debt/GCA stood high at 9.92 years for FY15. The Company's
liquidity has remained tight in the past as reflected in current
ratio which has remained below unity though the same had improved
marginally as on March 31, 2015. The company's performance has
largely been impacted by subdued demand for sugar as well as high
cost of inventory limiting the company to make profits in the
sugar division.
INDO PRODUCTS: CARE Assigns 'B' Rating to INR6cr LT Loan
--------------------------------------------------------
CARE assigns 'CARE B' rating to the bank facilities of Indo
Products.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank Facilities 6 CARE B Assigned
Rating Rationale
The rating assigned to the bank facilities of Indo Products (IP)
is primarily constrained by its fluctuating operating income, low
profitability margins and weak overall solvency position. The
rating is further constrained by the working capital intensive
nature of operations, risk associated with the sole proprietorship
nature of constitution and the inherent cyclicality in the steel
industry. The rating, however, derives strength from the
experience of the promoters, established track record of
operations and association with well-known steel manufacturers.
Going forward, the ability of the company to increase its scale of
operations along with improvement in profitability margins and the
overall solvency position would remain the key rating
sensitivities.
IP was incorporated in 1979 as a partnership concern and was
engaged in the manufacturing of steel products. The firm was
subsequently reconstituted as a sole proprietorship, with Mr
Varinder Gupta as the proprietor in 1994. The nature of business
was also changed from manufacturing of steel products to trading
of these products. The firm is engaged in the distribution of
steel products including wires, coils, rods, bars, etc, for JSW
Steel Limited and Steel Authority of India Ltd. (SAIL) through
MOUs (Memorandum of Understanding) with these companies. These
products, primarily sold in the Punjab region, find application in
bicycle parts, automobile components, fasteners, etc.
For FY15, IP achieved a total operating income of INR60.20 crore
with a PAT of INR0.12 crore in FY15 (refers to the period April 01
to March 31), as against the total operating income of INR71.44
crore with a PAT of INR0.10 crore in FY14.
J. K. DEVELOPERS: CRISIL Assigns B+ Rating to INR120MM Term Loan
----------------------------------------------------------------
CRISIL has assigned its 'CRISIL B+/Stable' rating to the long-term
bank facility of J. K. Developers (JKD).
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Proposed Term Loan 120 CRISIL B+/Stable
The rating reflects exposure to risks related to implementation
and saleability of the project because of initial stage of
construction, and susceptibility to cyclicality inherent in the
Indian real estate industry. These weaknesses are mitigated by the
promoters' experience in Pune's real estate market along with
their funding support.
Outlook: Stable
CRISIL believes JKD will benefit over the medium term from its
promoters' extensive industry experience. The outlook may be
revised to 'Positive' if healthy sales of units and timely receipt
of customer advances and implementation of project lead to healthy
cash inflow. Conversely, the outlook may be revised to 'Negative'
if time and cost overruns, lower-than-expected sales, or delays in
receipt of customer advances lead to low cash inflow, thus
impacting liquidity.
JKD was set up in 2010 by Mr. Bhalchandra Murkute, Mr. Dhananjay
Nimbalkar, Mr. Anil Salunkhe and Mr. Milind Jadhav. The firm is a
part of the Relicon group which is engaged in real estate
development largely in Pune. JKD currently is undertaking real
estate development, Kian, a residential-cum-commercial project
with 176 residential units and around 42 commercial units in
Ambegaon, Pune.
KOYO GRANITO: CRISIL Assigns 'B' Rating to INR170MM Term Loan
-------------------------------------------------------------
CRISIL has assigned its 'CRISIL B/Stable' rating to the bank
facilities of Koyo Granito LLP (KGL).
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Proposed Term Loan 170 CRISIL B/Stable
Proposed Bank Guarantee 30 CRISIL B/Stable
Proposed Cash Credit Limit 70 CRISIL B/Stable
The ratings reflect the firm's start-up phase and expected modest
scale of operations in the highly competitive ceramic tiles
industry. The ratings also factor in large expected working
capital requirement. These rating weaknesses are partially offset
by the extensive industry experience of the firm's promoters and
benefits derived from its favourable location in Morbi, Gujarat,
the hub of the ceramics industry in India.
Outlook: Stable
CRISIL believes KGL will continue to benefit over the medium term
from its promoters' extensive industry experience. The outlook may
be revised to 'Positive' if operations stabilise on time, leading
to substantial cash accrual. Conversely, the outlook may be
revised to 'Negative' in case of low accrual because of low order
flow or profitability, or weakening of the firm's financial risk
profile most likely due to substantial working capital requirement
or debt-funded capital expenditure.
KGL, established in Morbi in 2015, is promoted by Mr. Rajeshkumar
Ishwarlal Panchotiya, Mr. Pravinbhai Vashrambhai Kundariya, and
their family members. The firm is setting up a unit with a
capacity of 54,000 tonnes per annum to manufacture vitrified
tiles. It will commence operations by end of August 2016.
M P AGARWALA: Ind-Ra Assigns 'IND BB' Long-Term Issuer Rating
----------------------------------------------------------------
India Ratings and Research (Ind-Ra) has assigned M P Agarwala
(MPA) a Long-Term Issuer Rating of 'IND BB-'. The Outlook is
Stable.
KEY RATING DRIVERS
The ratings reflect MPA's small size of operations, moderate
credit metrics, and tight liquidity position. FY15 revenue was
INR246 million (FY14: INR213 million), net leverage was 3.2x
(4.1x) and EBITDA interest coverage was 2.0x (2.4x). Also,
liquidity is tight as indicated by its average fund-based facility
utilisation of 95.8% over the 12 months ended December 2015.
The company booked revenue of INR272.3m in 9MFY16, and has a
current order book of INR465.39m.
The ratings are supported by the more than three decades of
experience of the company's founders in the engineering,
procurement and construction segment.
RATING SENSITIVITIES
Positive: Substantial growth in the top line and an improvement in
the profitability leading to a sustained improvement in the credit
metrics will lead to a positive rating action.
Negative: Any decline in the profitability resulting in a further
stress on the liquidity position and sustained deterioration in
the credit profile will lead to a negative rating action.
COMPANY PROFILE
Incorporated 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.
MPA's ratings are as follows:
-- Long-Term Issuer rating: assigned 'IND BB-'; Outlook Stable
-- INR70 million fund-based working capital facilities: assigned
'IND BB-'/Stable/'IND A4+'
-- INR110 million non-fund-based working capital facilities:
assigned 'IND A4+'
M. D. AGRO: ICRA Reaffirms B+ Rating on INR25cr LT Loan
-------------------------------------------------------
ICRA has reaffirmed its long term rating of [ICRA]B+ on the
INR25.0 crore* fund based bank facilities of M. D. Agro Foods.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Fund
Based Limits 25.0 [ICRA]B+; reaffirmed
The rating reaffirmation continues to take into account highly
competitive and fragmented nature of the rice industry, marked by
numerous organised as well as unorganised participants, which
limits pricing power of participants like MDAF. Further, the
rating takes into account MDAF's low margins and highly leveraged
capital structure as reflected in gearing of 8.34 times as on 31st
March, 2015 resulting in weak debt coverage indicators. The rating
also factors in the high working capital intensive nature of the
rice business and the vulnerability of MDAF's profitability to
agro climatic risks and risks inherent in the partnership firms
like limited ability to raise capital; risk of dissolution.
However, the rating favourably takes into account the long
experience of its promoters in the rice industry and their
financial support in the form of unsecured loans to meet the
funding requirements; locational advantage enjoyed by the firm due
to its milling facilities based out of Haryana which is a major
rice growing state facilitating easy availability of paddy and
rice.
Going forward, the ability of the firm to improve its margins on a
sustainable basis and improve its working capital intensity will
be the key rating sensitivities.
MDAF was established in Nissing in Karnal (Haryana) in 2009. The
firm mills and processes basmati rice. MDAF commenced commercial
operations in January 2010, and is owned and managed by Mr. Ajay
Kumar and Mr. Praveen Kumar.
Recent Results
The company reported a net profit after tax of INR0.12 crore on an
operating income of INR103.86 crore in FY2015 as against a net
profit after tax of INR0.10 crore on an operating income of
INR83.70 crore in FY2014.
M. MOHAN: ICRA Assigns 'B' Rating to INR1.25cr LT Loan
------------------------------------------------------
ICRA has assigned a long term rating of [ICRA]B to the INR1.25
crore long term fund based bank limits of M/s. M. Mohan Doss. ICRA
has also assigned a short term rating of [ICRA]A4 to the INR4.00
crore non fund based limits of MM.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term, fund
based facilities 1.25 [ICRA]B assigned
Short Term, non
fund based facilities 4.00 [ICRA]A4 assigned
The ratings assigned takes into account the small scale of
operations of M/s M. Mohan Doss, the significant sectoral
concentration of the firm with its presence limited to railway
projects in south India, primarily in Chennai and Bangalore and
the relatively lower value added nature of projects undertaken
which limits the margins of the concern, particularly in view of
the high competition prevailing in the industry. ICRA also notes
that being a proprietorship concern, MM is exposed to risks of
capital withdrawals.
The rating, nevertheless, positively factors in the firm's and the
proprietor's long standing presence and established track record
in the railway construction industry, the availability of orders
in hand providing visibility to the revenues in the short term,
going forward and the adequate man power and equipments available
with the firm to execute the orders in hand.
M/s M. Mohandoss is a civil works contracting firm based in
Vellore under the proprietorship of Mr. Markandan Mohandoss since
1990. MM undertakes contract works for the Southern and South
Western Railways in the states of Kerala, Karnataka and Tamil
Nadu. The firm undertakes projects such as earthworks, blanketing,
linking of track, ballast dumping and other allied works.
For FY 2014, as per audited results, the company has reported an
operating income of INR8.5 crore and Profit After Tax (PAT) of
INR0.6 crore.
MAGBRO HEALTHCARE: CRISIL Reaffirms B- Rating on INR70MM Loan
-------------------------------------------------------------
CRISIL's rating on the bank facilities of Magbro Healthcare
Private Limited (MPL) continues to reflect the company's modest
financial risk profile because of modest net worth and debt
protection metrics, and small scale of operations. These
weaknesses are partially offset by its promoters' extensive
experience in the pharmaceuticals industry.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 70 CRISIL B-/Stable (Reaffirmed)
Letter of Credit 20 CRISIL A4 (Reassigned)
Proposed Long Term
Bank Loan Facility 20 CRISIL B-/Stable (Reaffirmed)
Outlook: Stable
CRISIL believes MPL will continue to benefit over the medium term
from its promoters' extensive industry experience. The outlook may
be revised to 'Positive' if the company registers more-than-
expected growth in revenue and net cash accrual, or if promoters
infuse substantial equity to support its capital structure, or if
its debt protection metrics improve. Conversely, the outlook may
be revised to 'Negative' if the company's financial risk profile
deteriorates because of substantially low profitability or
revenue, or large debt-funded capital expenditure, or stretch in
working capital cycle.
MPL, incorporated in 2006, manufactures, markets, and trades in
pharmaceutical formulations under its own brands. It also
undertakes contract manufacturing for companies such as Unichem
Laboratories Ltd and Microlabs Ltd. MPL is promoted by Mr. Sudhir
Maingi, his brother Dr. Sukhdev Maingi, and a group of
professionals.
MAHALAXMI SEAMLESS: CRISIL Assigns 'B' Rating to INR40MM Loan
-------------------------------------------------------------
CRISIL has assigned its 'CRISIL B/Stable/CRISIL A4' ratings to the
bank facilities of Mahalaxmi Seamless Limited (MSL).
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Inland/Import
Letter of Credit 40 CRISIL A4
Bank Guarantee 15 CRISIL A4
Cash Credit 40 CRISIL B/Stable
The ratings reflect the company's small scale, and working capital
intensive nature, of operations in a fragmented steel pipes and
tubes industry, and subdued profitability which is vulnerable to
raw material price fluctuations. The ratings also factor in weak
debt protection metrics. These rating weaknesses are partially
offset by the extensive industry experience of MSL's promoters and
an established customer base.
Outlook: Stable
CRISIL believes MSL 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 and sustained
improvement in revenue and profitability, leading to sizable cash
accrual. Conversely, the outlook may be revised to 'Negative' if
the company's financial risk profile, particularly liquidity,
weakens, most likely because of low cash accrual, stretched
working capital cycle, or any major capital expenditure.
Incorporated in 1992, MSL manufactures cold-drawn seamless pipes
and tubes used in various industries such as oil and gas,
petrochemicals, engineering, and power. It is promoted by Mr.
Madhavprasad Jalan and Mr. Vivek Jalan. Its manufacturing
facilities are at Sukeli, in the Raigad district of Maharashtra.
MSL reported a net loss of INR1.32 million on operating income of
INR186.28 million for 2014-15 (refers to financial year, April 1
to March 31), as against a net loss of INR34.11 million on
operating income of INR144.96 million for the previous year.
MAHALAXMI TRANSPORT: CRISIL Assigns 'B' Rating to INR160MM Loan
---------------------------------------------------------------
CRISIL has assigned its 'CRISIL B/Stable' rating to the long term
bank facility of Mahalaxmi Transport (MT, part of Mahalaxmi
group).
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Rupee Term Loan 160 CRISIL B/Stable
The ratings reflect Mahalaxmi Group's below-average financial risk
profile marked by modest networth, high gearing and moderate debt
protection metrics, and stretched liquidity marked by high
upcoming repayments. These rating weaknesses are partially offset
by the Mahalaxmi group's promoter's extensive industry experience
and diversified revenue profile.
For arriving at the rating, CRISIL has combined the business and
financial risk profiles of MT and Mahalaxmi Automotive Private
Limited (MAPL). This is because these two entities, together
referred to as the Mahalaxmi group, belong to the same promoters
and are in the same line of business and have significant
operational and financial synergies.
Outlook: Stable
CRISIL believes that Mahalaxmi Group will benefit over the medium
term from its extensive industry experience of promoters. The
outlook may be revised to 'Positive' if the company achieves
higher than expected revenues while maintaining its profitability
or if there is capital infusion leading to improvement in the
capital structure. Conversely, the outlook may be revised to
'Negative' if Mahalaxmi Group's financial risk profile weakens
because of stretch in working capital cycle, or decline in
revenues or profitability, or due to large than expected debt
funded capital expenditure.
MT set up in 2006, and MAPL, incorporated in 1997, is promoted by
Baramati based, Mr. Sadashiv Satav and his sons, Mr. Nitin Satav
and Mr. Sachin Satav. The group is engaged in dealership of two
wheelers of Hero Motocorp Ltd (HCL, rated CRISIL AAA/CRISIL
FAAA/Stable/CRISIL A1+) dealership of passenger vehicles of Maruti
Suzuki India Ltd (MSIL, rated CRISIL AAA/ Stable/CRISIL A1+),
transportation of vehicles for automotive companies and providing
buses on rent to Pune Mahanagar Parivahan Mahamandal Limited
(PMPML).
MALHAR FASHIONS: CRISIL Assigns B- Rating to INR37MM Loan
---------------------------------------------------------
CRISIL has assigned its 'CRISIL B-/Stable/CRISIL A4' ratings to
the bank facilities of Malhar Fashions India Private Limited
(MFIPL).
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Term Loan 15 CRISIL B-/Stable
Proposed Long Term
Bank Loan Facility 6 CRISIL B-/Stable
Letter of Credit 5 CRISIL A4
Export Packing Credit 37 CRISIL B-/Stable
Foreign Bill Purchase 27 CRISIL B-/Stable
The ratings reflect MFIPL's small scale of operations in the
highly competitive and fragmented readymade garments (RMG)
industry, large working capital requirement, and weak financial
risk profile marked by modest networth, high gearing, and subdued
weak debt protection metrics. These weaknesses are partially
offset by its promoters' extensive experience in the RMG industry.
Outlook: Stable
CRISIL believes MFIPL will continue to benefit over the medium
term from its promoters' extensive industry experience. The
outlook may be revised to 'Positive' if the company's cash accrual
increases backed by revenue growth, improved profitability, and
prudent working capital management, leading to better debt
protection metrics and liquidity. Conversely, the outlook may be
revised to 'Negative' if financial risk profile, particularly
liquidity, deteriorates because of more-than-expected stretch in
working capital cycle, or debt-funded capital expenditure, or
less-than-expected cash accrual.
MFIPL, promoted by Mr. Niraj Jhaveri and Mr. Dinesh Paharia,
manufactures and exports RMG, primarily for women. Its plant is at
Bhiwandi, Maharashtra.
MALIK MARKETING: ICRA Assigns 'B' Rating to INR7.50cr Cash Loan
---------------------------------------------------------------
ICRA has assigned a long term rating of [ICRA]B to the INR7.50
crore cash credit facility and INR0.40 crore untied limit of Malik
Marketing & Infracom Private Limited. ICRA has also assigned a
short term rating of [ICRA]A4 to the INR2.10 crore non fund based
facility of MMIPL.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Fund Based Limit
Cash Credit 7.50 [ICRA]B assigned
Fund Based Limit
Untied limit 0.40 [ICRA]B assigned
Non Fund Based Limit
Bank Guarantee 2.10 [ICRA]A4 assigned
Rating Rationale
The assigned ratings take into account MMIPL's small scale of
current operations with no major growth witnessed in the top-line
over the past few years, high completion faced from other
distributors of various brands and e-tailers, and trading nature
of the company's operations with margins set by the principal,
which results in low profitability of the company. The ratings are
also constrained by the weak financial profile of the company
characterized by nominal profits and cash accruals, and a
leveraged capital structure, leading to depressed level of
coverage indicators, ICRA also takes note of the stretched
liquidity position of the company as reflected by high utilization
of working capital limits, which also restricts its financial
flexibility. However, ICRA has favourably considered the
experience of the promoters in the business of distributing FMCG
products and mobile handsets, and MMIPL's distributorship rights
for well established brands primarily for Durg district of
Chhattisgarh, which ensures regular order flow from the region.
Incorporated in 2008, MMIPL is engaged in trading of FMCG products
and mobile handsets (including sale of accessories and e-
recharge). The company is based in Durg, Chhattisgarh and has a
distributorship agreement with some of the leading FMCG players
like, Dabur India Ltd, Hindustan Unilever Ltd, Panasonic Energy
India Ltd, Emami Ltd, etc. The company also operates a retail
outlet in Durg for mobile handsets and other allied services, and
have a franchisee of Reliance Communications Ltd. MMIPL has
recently entered into an agreement with Reliance Jio Infocomm Ltd
for distribution of its mobile handsets and network services in
the Raipur district of Chhattisgarh.
Recent Results
During the first nine months of 2015-16, MMIPL posted a profit
before tax of INR0.06 crore (provisional) on an operating income
of INR18.68 crore (provisional). The company reported a net profit
of INR0.08 crore on an operating income of INR26.80 crore in 2014-
15.
MANOJ TRADING: ICRA Reaffirms B+ Rating on INR32cr Cash Loan
------------------------------------------------------------
ICRA has reaffirmed the long-term rating of [ICRA]B+ to INR32.00
crore fund based cash credit facility of Manoj Trading Co. ICRA
has also reaffirmed the short-term rating of [ICRA]A4 to the
INR1.00 crore short-term fund based sub-limits of cash credit
facility of the firm.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Fund based-Cash
Credit 32.00 [ICRA]B+; Reaffirmed
Fund based-Cheques/
DD purchases (1.00) [ICRA]A4 ; Reaffirmed
The re-affirmed ratings continue to remain constrained by Manoj
Trading Co's moderate scale of operation in a highly fragmented
and competitive industry structure with low entry barriers, which
limits pricing flexibility. The ratings are further constrained by
the firm's low value additive nature of business of processing
fabric on job work basis which has kept the profit metrics weak
and its tight liquidity profile as reflected in high utilization
of sanctioned bank limits. Further, the firm's profit margins are
vulnerable to price fluctuations in primary raw materials i.e
greige fabrics. The ratings are also constrained by the firm's
weak coverage indicators and a highly leverage capital structure.
However, a significant portion (32%) of the total debt comprises
unsecured loans from proprietor and relatives, which is a source
of comfort. The ratings are further constrained by the fact that
MTC is a proprietorship concern and the quantum of withdrawals
from the capital account will remain a key sensitivity.
The ratings, however, continue to favourably factor in the long
experience of the promoters in the textile industry, the
diversified customer base and its locational advantage due to its
presence in Mumbai's wholesale textile market, which in-turn
distributes sarees all over India and also in the export market.
Manoj Trading Co. is a proprietorship concern engaged selling of
sarees manufactured on external job work basis. Mr. Manoj Jain is
the proprietor of the firm who is engaged in this line of business
since 1983. The firm has its registered office located at
Kalbadevi, Mumbai. Sister concern Priyanka Sarees Private Limited
is engaged in the same line of business and operates from the same
geographical location.
MOTHERHOOD INSTITUTE: ICRA Assigns B+ Rating to INR5.0cr Loan
-------------------------------------------------------------
ICRA has assigned its long term rating of [ICRA]B+ and short term
rating of [ICRA]A4 to the INR12 crore fund based and non-fund
based facilities of Motherhood Institute of Management &
Technology Society.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Term Loan 5.00 [ICRA]B+; assigned
Cash Credit 2.00 [ICRA]B+; assigned
Bank Guarantee 3.75 [ICRA]A4; assigned
Long Term-Unallocated 1.25 [ICRA]B+; assigned
ICRA's ratings are constrained by the modest operating scale of
the Society and the high competitive intensity in the region,
resulting in a competitive fee structure. ICRA also takes note of
the likely substantial capital expenditure going forward, the
implementation and impact of which on the Society's financial
profile will be a key rating sensitivity. However, the rating
favourably factors in the track record of the Trustees who run
eight other trusts and twenty educational institutes in the states
of Uttarakhand and Uttar Pradesh. Further, while the operating
scale remains small, MIMT has satisfactory occupancy,
profitability margins and debt coverage indicators. ICRA also
notes that the society has been awarded the status of a university
which will provide it flexibility in terms of courses offered, fee
revisions, sanctioned intake etc.
Going forward, MIMT's ability to improve its operating scale, and
maintain its profitability and debt coverage indicators will be
the key rating sensitivities. The Society's ability to implement
the planned capital expenditure within time and budgeted costs
will also be a key monitorable.
Incorporated in 2004, MIMT runs the Motherhood Institute of
Management & Technology Institute in Roorkee, Uttarakhand. The
institute is affiliated to the Uttarakhand Technical University
and All India Council for Technical Education (AICTE), and runs
courses like BBA, BCA, B.Com and technical courses like
Polytechnic, B. Sc. etc. In July 2015, the institute has been
awarded the status of a university by the Uttarakhand Government,
which would be implemented in August 2015. MIMT is part of a group
which has been operating since 2001 and currently manages eight
Trusts which manage institutes offering under graduate and post
graduate courses in engineering, MCA, MBA and pharmacy.
Recent Results
MIMT reported a net surplus of INR2.0 crore on revenue receipts of
INR6.0 crore in 2013-14, as compared to a net surplus of INR0.1
crore on revenue receipts of INR1.6 crore in the previous year.
The society on a provisional basis reported revenue receipts of
INR6.6 crore for FY 2014-15.
MSV LABORATORIES: CARE Reaffirms B Rating on INR7.86cr LT Loan
--------------------------------------------------------------
CARE reaffirms rating to the bank facilities of MSV Laboratories
Pvt. Ltd.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank Facilities 7.86 CARE B Rating
suspension revoked
and reaffirmed
Rating Rationale
The ratings for the bank facilities of MSV Laboratories Pvt. Ltd.
(MSVL) continue to remain constrained by its small scale of
operations, seasonal nature of agricultural industry, ie, the user
industry, highly competitive domestic industry due to
fragmentation and high gearing ratios. The ratings, however,
derive strength from its experienced promoters with long &
satisfactory track record and adequate R&D department.
Going forward, the ability to improve scale of operations and
profit margins along with ability to manage working capital
effectively will be the key rating sensitivities.
Purba Medinipur-based (West Bengal) MSV, incorporated in November
1991 was promoted by Mr Asok Maiti along with his family members.
Since inception, it has been involved in the manufacturing of bio-
fertilizer, bio-pesticides, organic fertilizer and organic
pesticides. The sole manufacturing facility of the company is
located at Medinipur, West Bengal, with an installed capacity of
600 tons of bio fertilizer, 6,000 tons of organic fertilizer, 20
tons of bio-pesticides and 20 KL of organic pesticides. MSV sells
its products through distributors and markets its products under
the brand name of "Kiran" and "Carbo" and has wide presence in the
state of West Bengal.
MSV is a closely-held family managed business. The board of the
company comprises four members, representing the promoters with Mr
Asok Maiti, Chairman, being at the helm of affairs. He has an
experience of over three decades in this line of business. The
day-to-day affairs of the company are looked upon by him with
adequate support from his codirectors and a team of experienced
personnel.
During FY15 (refers to the period April 01 to March 31), the
company reported a total operating income of INR6.52 crore
(FY14: INR5.82 crore) and a PAT of INR0.34 crore (in FY14: INR0.35
crore). Furthermore, the company has achieved a total operating
income of INR5.00 crore during 9MFY16 (refers to the period
April 1 to December 31).
MUKTAR AUTOMOBILES: CARE Reaffirms 'B' Rating on INR12.36cr Loan
----------------------------------------------------------------
CARE reffirms the rating assigned to the bank facilities of
Muktar Automobiles Private Limited.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank Facilities 12.36 CARE B Reaffirmed
Short-term Bank Facilities 4.00 CARE A4 Reaffirmed
Rating Rationale
The ratings assigned to the bank facilities of Muktar Auomobiles
Private Limited (MAPL) continue to remain constrained on account
of the limited experience of the promoters in the automobile
dealership business, thin profitability margins inherent to the
dealership business, highly leveraged capital structure and
working capital intensive nature of operations.
The ratings favourably factors in the growth in the total
operating income during FY15 (refers to the period from April 01
to March 31) albeit with decline in the volumes of the vehicle
sold.
Going forward, the ability of MAPL to improve its scale of
operation along-with effective management of working capital
profitability are the key rating sensitivities.
MAPL incorporated in May, 2011 is an authorized dealer of
passenger vehicles (PV) segment for Mahindra & Mahindra Limited
(MML). MAPL is based out of Goa and is engaged in the sale of new
cars, servicing of the vehicles and sale of the spare parts and
accessories for MML. MAPL currently operates out of five
facilities in Goa and one in Mangalore. MAPL belongs to the
'Sheikh Muktar Group' (SMG) of companies based out of Goa. The SMG
has interests in mining, construction, engineering, logistics,
hospitality, shipping and automobiles. The flagship company of the
group - Muktar Minerals Private Limited (MMPL) holds 50% stake in
MAPL.
As per FY15 (Audited) results, company reported total operating
income (TOI) of INR103.38 crore (P.Y. INR92.55 crore) and profit
after tax of INR0.40 crore (P.Y. INR1.79 crore).
NITYAGOPAL RICE: CRISIL Assigns B Rating to INR42.5MM Term Loan
---------------------------------------------------------------
CRISIL has assigned its 'CRISIL B/Stable/CRISIL A4' ratings to the
bank facilities of Nityagopal Rice Mill (NRM). The ratings reflect
NRM's exposure to risks related to project implementation and
stabilisation of operations, and susceptibility to regulatory
changes, volatility in raw material prices, and rainfall. These
weaknesses are partially offset by stable demand for rice and
extensive entrepreneurial experience of the firm's promoters.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Term Loan 42.5 CRISIL B/Stable
Proposed Long Term
Bank Loan Facility 10.5 CRISIL B/Stable
Bank Guarantee 2.0 CRISIL A4
Cash Credit 25.0 CRISIL B/Stable
Outlook: Stable
NRM will benefit over the medium term from its promoters'
extensive industry experience and healthy prospects for the rice
industry. The outlook may be revised to 'Positive' in case of
timely implementation of mill and higher-than-expected revenue and
profitability. Conversely, the outlook may be revised to
'Negative' in case of significant time and cost overrun in project
completion, lower-than expected capacity utilisation, or
significant stretch in working capital cycle, resulting in weak
financial risk profile.
NRM, established in 2015, is setting up a 96-tonne-per-day non-
basmati rice mill at Burdwan in West Bengal. Its operations will
be managed by partners Mr. Tapan Dutta, Mr. Swapan Dutta, and Mr.
Janardhan Dutta.
NORTH EAST: CARE Assigns B+ Rating to INR5.95cr LT Loan
-------------------------------------------------------
CARE assigns 'CARE B+' rating to the long-term bank facilities of
North East Ferro Alloys Co. Pvt. Ltd.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank Facilities 5.95 CARE B+ Assigned
Rating Rationale
The rating assigned to the bank facilities of North East Ferro
Alloys Co. Pvt. Ltd. are constrained by its modest scale of
operations with low profitability margins, lack of backward
integration vis-a-vis volatility in input prices, intense
competition due to fragmented nature of the steel industry,
foreign exchange fluctuation risk and working capital intensive
nature of business.
The aforesaid constraints are partially offset by the experienced
promoters and strategic location of the plant.
The ability of the company to grow its scale of operations,
improve its profitability margins and manage its working capital
efficiently would be the key rating sensitivities.
North East Ferro Alloys Co. Pvt. Ltd., incorporated in July, 2008
and having commenced commercial operation from April, 2009 was
promoted by Goyal Family of Darjeeling, West Bengal. The company
is engaged in manufacturing of mild steel (MS) Ingots (capacity -
24,000 MTPA) with plant being located at Darjeeling, West Bengal.
Apart from manufacturing, it is also involved in trading
activities of sponge iron (contributing around 60.35% of total
sales in FY15 - refers to the period April 1 to March 31).
Apart from India, the company also sells MS Ingots internationally
by exporting the same to Bhutan, which contributes around 50% of
the total sales in FY15.
During FY15, NEFA reported a total operating income of INR107.14
crore (as against INR87 crore in FY14) and a loss of INR0.04 crore
(as against profit of INR0.16 crore in FY14).
OM BIOMEDIC: Ind-Ra Suspends 'IND D' Long-Term Issuer Rating
------------------------------------------------------------
India Ratings and Research (Ind-Ra) has migrated Om Biomedic Pvt.
Ltd.'s 'IND D' Long-Term Issuer Rating to the suspended category.
The rating will now appear as 'IND D(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 Om Biomedic.
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.
Om Biomedic's ratings:
-- Long-Term Issuer rating: migrated to 'IND D(suspended)' from
'IND D'
-- INR36 million long-term loan: migrated to Long-term 'IND
D(suspended)' from 'IND D'
-- INR150 million fund-based working capital limit: migrated to
Long-term 'IND D(suspended)' from 'IND D'
-- INR75 million non-fund-based working capital limit: migrated
to Short-term 'IND D(suspended)' from 'IND D'
OM GANESH: CRISIL Assigns B+ Rating to INR172.3MM Loan
------------------------------------------------------
CRISIL has assigned its 'CRISIL B+/Stable' rating to the long-term
bank facilities of OM Ganesh Jewellers Private Limited (OGJPL).
The rating reflects the company's below-average financial risk
profile because of weak debt protection metrics, and
susceptibility of revenue and profitability to changes in
government regulations and to volatility in gold prices. These
rating weaknesses are partially offset by the extensive experience
of the company's promoters in the gold jewellery manufacturing
industry.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Proposed Working
Capital Facility 172.3 CRISIL B+/Stable
Long Term Loan 27.7 CRISIL B+/Stable
Proposed Long Term
Bank Loan Facility 50.0 CRISIL B+/Stable
Outlook: Stable
CRISIL believes OGJPL will continue to benefit over the medium
term from the extensive industry experience of its promoters. The
outlook may be revised to 'Positive' in case of sustainable
improvement in revenue and profitability, resulting in
substantially higher-than-expected cash accrual and hence in a
better financial risk profile. Conversely, the outlook may be
revised to 'Negative' in case of lower-than-expected cash accrual
or an increase in working capital requirement, leading to
deterioration in the financial risk profile.
OGJPL was originally set up in 2003 as a partnership firm; the
firm was later reconstituted as a private limited company in 2011.
The Chennai-based company manufactures gold Jewellery. Its
operations are managed by Mr. Mukesh Dhakan and his brothers.
In 2014-15 (refers to financial year, April 1 to March 31), profit
after tax (PAT) was INR3.6 million on total revenue of INR548.52
million, against a PAT of INR8.5 million on total revenue of
INR713.17 million in 2013-14.
PADMEY IMPEX: Ind-Ra Downgrades LT Issuer Rating to 'IND D'
-----------------------------------------------------------
India Ratings and Research (Ind-Ra) has downgraded Padmey Impex
Private Limited's (PIPL) Long-Term Issuer Rating to 'IND D' from
'IND B+(suspended)'.
KEY RATING DRIVERS
The ratings reflect PIPL's overutilisation of the working capital
facilities for more than 30 days in January 2016 due to its
stretched liquidity position.
RATING SENSITIVITIES
Working capital utilisation within the sanctioned limits for three
consecutive months could result in a positive rating action.
COMPANY PROFILE
Established in 2008, PIPL manufactures plastic bags at its unit in
Daman (Maharashtra).
PIPL's ratings:
-- Long-Term Issuer Rating: downgraded to 'IND D' from 'IND
B+(suspended)'
-- INR100 million fund-based limits: downgraded to Long-term
'IND D' from IND B+(suspended) and Short-term 'IND D' from
'IND A4(suspended)'
-- INR80 million non-fund-based limits: downgraded to Short-term
'IND D' from 'IND A4(suspended)'
PANDA INFRA: CRISIL Upgrades Rating on INR150MM Cash Loan to B
--------------------------------------------------------------
CRISIL has upgraded its rating on the long-term bank loan facility
of Panda Infra Projects (India) Private Limited (PIPL) 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 100 CRISIL A4 (Reaffirmed)
Cash Credit 150 CRISIL B/Stable (Upgraded
from 'CRISIL B-/Stable')
The upgrade reflects improvement in PIPL's business risk profile
and working capital efficiency due to increase in scale of
operations and healthy receivables management which is expected to
be sustained over the medium term. Turnover almost quadrupled to
INR760.7 million in 2014-15 (refers to financial year, April 1 to
March 31) from INR207.7 million in 2013-14 because of faster
completion of projects. Working capital profile of PIPL also
improved supported by improvement in debtor days to 47 days in
2014-15 as against 249 days in 2013-14. PIPL executed all pending
projects in Bhubaneswar in 2014-15, due to Odisha government's
urgency and intervention in completion of all civil construction.
Order execution was also supported by speedier fund inflow from
government authorities, helping PIPL scale up operations. Further,
PIPL has a healthy order book of INR3332 million as on February
2016, which provides adequate revenue visibility over the medium
term. The company will continue to benefit over the medium term
from its management's extensive industry experience and ramp-up of
operations.
The ratings reflect PIPL's large working capital requirement,
modest debt protection metrics, and stretched liquidity. These
weaknesses are partially offset by its promoters' extensive
experience in the civil construction segment, and its above-
average financial risk profile because of modest gearing and
strong debt protection metrics.
Outlook: Stable
CRISIL believes PIPL will continue to benefit over the medium term
from its management's extensive industry experience. The outlook
may be revised to 'Positive' if revenue and profitability increase
substantially, leading to a better financial risk profile.
Conversely, the outlook may be revised to 'Negative' in case of
steep decline in revenue and profitability, or large debt-funded
capital expenditure, or stretch in working capital cycle,
weakening financial risk profile.
PIPL was founded in September 2002 by Odisha-based Mr. Pratap
Kishore Panda and his wife Ms. Sujata Panda. The company
constructs and repairs roads in Balasore, Keonjhar, and Khurda in
Odisha. It also repairs buildings.
PARIKH CONSTRUCTIONS: ICRA Suspends 'C' Rating on INR12.5cr Loan
----------------------------------------------------------------
ICRA has suspended [ICRA]C rating assigned to the INR12.50 crore
long term fund based facilities of Parikh Constructions Private
Limited. The suspension follows ICRA's inability to carry out a
rating surveillance in the absence of the requisite information
from the company.
Incorporated in 2008; Parikh Constructions Private Limited (PCPL)
is a closely held private limited company which is held by two
brothers Mr. Motilal Parikh (Chairman) and Mr. Gokul Parikh
(Managing Director) and his family members. Parikh group has been
involved in construction activities since 1990 and has executed
around 200 projects including industrial, institutional, hotels &
resorts, temple, bunglows and commercial buildings in various
parts of Maharashtra such as Ichalkaranji, Sangli, Mumbai,
Kolhapur and Pune.
PATWARI PLASTICS: CRISIL Assigns B+ Rating to INR50MM Cash Loan
---------------------------------------------------------------
CRISIL has assigned its 'CRISIL B+/Stable' rating to the long-term
bank facilities of Patwari Plastics Pvt Ltd (PPPL). The rating
reflects average financial risk profile because of high gearing
and small networth, and the susceptibility of profitability to
volatility in raw material prices and to intense competition in
the packaging industry. These rating weaknesses are mitigated by
the promoter's extensive experience in the woven sacks industry
and by a diversified customer base.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Proposed Long Term 22.4 CRISIL B+/Stable
Bank Loan Facility
Proposed Cash Credit
Limit 10 CRISIL B+/Stable
Cash Credit 50 CRISIL B+/Stable
Long Term Loan 7.6 CRISIL B+/Stable
Outlook: Stable
CRISIL believes PPPL 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 more-than-expected increase in
scale of operations while sustainably improving the operating
margin. Conversely, the rating may be revised to 'Negative' if the
financial risk profile weakens because of increased working
capital borrowings or in case of any large, debt-funded capital
expenditure or low cash accrual.
PPPL was incorporated in 1995 as private limited company which
manufactures PP bags/HDPE bags and fabrics. The company is
promoted by Mr. Madan Lal Agarwal and is located at Industrial
Area, Shamshabad village, Hyderabad.
POPURI STEELS: ICRA Revises Rating on INR10cr LT Loan to B-
-----------------------------------------------------------
ICRA has revised the long-term rating to [ICRA]B- from [ICRA]B+
for the INR10.00 crore fund based limits of Popuri Steels limited.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Fund 10.00 [ICRA]B-; revised from
based Limits [ICRA]B+
The rating revision takes into account the deterioration in the
financial profile of the company with significant decline in
revenues during FY15 owing to subdued demand for sponge iron
leading to the decreased capacity utilization levels, losses
incurred at the operating level owing to higher products costs,
stretched gearing and coverage indicators, and high working
capital intensity. The rating revision factors in the bleak
outlook for the domestic sponge iron industry with higher usage of
steel scrap as substitute. The rating also considers inventory
carrying risk on account of sizeable inventory holding owing to
the uncertainty in raw material availability. However the rating
draws comfort from the long standing experience of the promoters
in the industry coupled with established base of customers.
Going forward, the ability of the company to scale up the
operations, improve profitability and effectively manage its
working capital requirements would be the key rating
sensitivities.
Popuri Steels Limited was incorporated in the year 2004 with the
establishment of a 1 x 50 TPD DRI (Direct reduced Iron or Sponge
Iron) at Mundargi Industrial area, Bangalore Road, Bellary. The
plant was shut down in 2009 and the company started another 2 x 50
TPD DRI plant in Halakundi village, Bellary in 2009. The company
is involved in the manufacturing of sponge iron using rotary klin
process. Mr. Popuri Akineedu is the current Managing Director of
the company.
Recent results
As per the audited FY15 financials, the company registered
operating loss of 3.93 crore on an operating income of INR29.68
crore as against operating profit of INR0.02 crore on an operating
income of INR42.34 crore in FY14.
PT. DEEN: ICRA Suspends B+ Rating on INR12.37cr Bank Loan
---------------------------------------------------------
ICRA has suspended the [ICRA] B+ rating for the INR12.37 crore
bank facilities of Pt. Deen Dayal Upadhyay Shikskan Trust. The
suspension follows ICRA's inability to carry out a rating
surveillance in the absence of the requisite information from the
company.
R. NATARAJAN: CRISIL Assigns 'B' Rating to INR50MM Cash Loan
------------------------------------------------------------
CRISIL has revoked the suspension of its rating on the long-term
bank facilities of R. Natarajan (RN) and has assigned its 'CRISIL
B/Stable/CRISIL A4' rating to the facilities. The ratings were
previously suspended by CRISIL on October 23, 2015, because RN had
not provided the necessary information required for a rating
review. The company has now shared the requisite information,
enabling CRISIL to assign ratings to its bank facilities.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Bank Guarantee 10 CRISIL A4 (Assigned;
Suspension Revoked)
Cash Credit 50 CRISIL B/Stable (Assigned;
Suspension Revoked)
The ratings reflect RN's below average financial risk profile,
marked by a small net worth and modest scale of operations with
geographic concentration in revenue profile, and risks related to
tender-based nature of operations. These rating weaknesses are
partially offset by the extensive experience of the promoters in
execution of civil construction industry.
Outlook: Stable
CRISIL believes that RN will continue to benefit over the medium
term from the experience of its promoters in the civil
construction industry and its moderate order book position. The
outlook may be revised to 'Positive' if it scales up its
operations significantly and improves its working capital
management, resulting in improvement in the firm's liquidity.
Conversely, the outlook may be revised to 'Negative' if RN's
working capital management weakens or if the firm undertakes a
large debt-funded capital expenditure programme or if its promoter
withdraw large capital, thus weakening its capital structure and
liquidity.
RN, based in Pondicherry, executes civil contracts. The firm is
promoted by Mr. R Natarajan.
R.K NATURAL: Ind-Ra Assigns 'IND B' Long-Term Issuer Rating
-----------------------------------------------------------
India Ratings and Research (Ind-Ra) has assigned R.K Natural Fibre
Private Limited (RKN) a Long-Term Issuer Rating of 'IND B'. The
Outlook is Stable. The agency also assigned RKN's INR68 million
fund-based facilities Long-term 'IND B'/Stable and Short-term 'IND
A4' ratings.
KEY RATING DRIVERS
The ratings reflect RKN's small scale of operations and weak
credit metrics. In FY15, revenue was INR98m (FY14: INR236m),
EBITDA interest coverage was 1.4x (1.5x) and net financial
leverage (Ind-Ra adjusted net debt/operating EBITDA) was 6.9x
(11.5x). EBITDA margins remained volatile and fluctuated between
0.4% and 8.6% over FY12-FY15 on cotton price fluctuation. The
ratings are constrained by the agricultural commodity-based
business which exposes the company to seasonality and price
volatility.
The company's liquidity was moderate with average utilisation of
the fund-based working capital limits being around 87.3% for the
12 months ended November 2015.
The ratings are supported by over two decades of experience of the
company's promoter in the ginning and pressing of cotton.
RATING SENSITIVITIES
Positive: A significant increase in the scale and profitability
leading to a sustained improvement in the credit metrics will be
positive for the ratings.
Negative: Any deterioration in the EBITDA margins leading to
sustained deterioration in the credit metrics will be negative for
the ratings.
COMPANY PROFILE
RKN was incorporated in 2010 and is engaged in the business of
ginning and pressing of raw cotton. The company's plant is located
near Vadodara with production capacity of 16,000 MT per annum.
RAAM FOUR: ICRA Suspends 'B' Rating on INR9.45cr Loan
-----------------------------------------------------
ICRA has suspended [ICRA]B rating assigned to the INR3.50 crore
fund based facilities, INR9.45 crore non-fund based limits and
INR7.05 crore unallocated limits of Raam Four Wheelers India
Private Limited. The suspension follows ICRA's inability to carry
out a rating surveillance in the absence of the requisite
information from the company.
Raam Four Wheelers India Private Limited (RFWIPL) was incorporated
in the year 2012. The company is an authorized dealer for Hyundai
Motor India Limited (HMIL) and has its showroom in Bijapur Road
Hubli, Karnataka. The showroom was opened in the month of July,
2013.
RADHA SMELTERS: Ind-Ra Cuts Long-Term Issuer Rating to 'IND D'
--------------------------------------------------------------
India Ratings and Research (Ind-Ra) has downgraded Radha Smelters
Ltd's (RSL) Long-Term Issuer Rating to 'IND D' from 'IND BB+'. The
Outlook was Stable. Simultaneously, Ind-Ra has reassigned RSL a
Long-Term Issuer Rating of 'IND BB' with a Stable Outlook. A full
list of rating actions is at the end of this commentary.
KEY RATING DRIVERS
The downgrade reflects the reschedulement of RSL's term loans from
Andhra Pradesh State Financial Corporation in December 2014. The
management opted for restructuring due to the continuous liquidity
pressure arising out of the weak demand-supply position of steel
globally.
The reassignment of the 'IND BB' rating reflects RSL's timely
repayment of all the term loans post reschedulement.
The ratings are however constrained by the deterioration in RSL's
credit profile with net leverage increasing to 4.8x in FY15 from
4.0x in FY14 and interest coverage decreasing to 1.2x from 1.7x,
due to a drop in EBITDA margin to 3.4% from 4.6%, while working
capital cycle increased to 68 days from 62 days.
The ratings are also constrained by company's weak liquidity
position as evident from the near full utilisation of the working
capital limits with average peak utilisation of around 99% in the
12 months ended January 2016. The company plans to pump funds in
the form unsecured loans to manage the cash flow pressures.
RATING SENSITIVITIES
Negative: Continued liquidity stress and/or further deterioration
in the credit profile will be negative for the ratings.
Positive: A significant improvement in the liquidity and credit
metrics will be positive for the ratings.
COMPANY PROFILE
Incorporated in 2007, RSL manufactures billets (36,000mtpa),
thermo-mechanically treated bars (6,0000mtpa), mild steel angels
and sections (9,600mtpa) at its facilities in Nacharam, near
Hyderabad.
During FY15, company reported revenue of INR2,903.9 million (FY14:
INR2717.7 million) and profit after tax of INR13.0m (INR17.5m).
RSL' ratings are as follows:
-- Long-Term Issuer Rating: downgraded from 'IND BB+' to
'IND D'; reassigned 'IND BB'/Stable
-- INR410 million fund-based working capital limit (increased
from INR330m): downgraded to 'IND C'/'IND A4' from 'IND
BB+'/'IND A4+' and reassigned 'IND BB'/Stable/'IND A4+'
-- INR17.2 million term loan limit (reduced from INR36.9m):
downgraded to 'IND C' from 'IND BB+' and reassigned 'IND
BB'/Stable
-- INR60 million non-fund-based working capital limit (reduced
from INR140 million): downgraded to 'IND A4' from 'INDA4+'
and reassigned 'IND A4+'
RAMKY PHARMA: ICRA Revises Rating on INR15cr Loan to C+
-------------------------------------------------------
ICRA has revised the long term rating for INR15.00 crore fund
based facilities of Ramky Pharma City India Limited to [ICRA]C+
from [ICRA]B- assigned earlier. The rating suspension action taken
in Dec'15 has been revoked.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Fund based limits 15.00 [ICRA]C+ revised; Suspension
Revoked
The revision in rating factors in the ongoing delays by RPCIL in
servicing debt obligations for bank facilities not rated by ICRA,
owing to stretched liquidity. Further, although the overall
utilization for the cash credit account is within the sanctioned
limit, the drawings continue to remain higher than the permissible
drawing limit as per the terms of sanction. RPCIL's liquidity is
stretched on account of large advances to weaker group entities,
pending receivables from Smilax Laboratories Limited, a group
company, and increasing receivables arising out of non receipt of
operations & maintenance (O&M) charges from customers who are yet
to set up their units. There has been slow progress in setting up
manufacturing units by customers with 30% under/yet to start
construction as on Dec 30, 2015. Further 135.46 acres of RPCIL's
assets which includes 25% (107 acres) of the leasable SEZ area,
that had been attached by the Enforcement Directorate during FY14
based on allegations that the company has received undue favors by
way of reduction in the green belt area, has not been released
yet, resulting in loss of revenues from the attached assets.
Ramky Pharma City India Limited (RPCIL) is a special purpose
vehicle promoted by Ramky Infrastructure Limited (RIL, 51%
shareholding), Ramky Estates and Farms Limited (REFL, 38%) and
Andhra Pradesh Industrial Infrastructure Corporation Limited
(11%). The company was incorporated in 2004 to develop SEZ over
2143 acres (of which SEZ area is only 431 acres) over two phases
in Parwada Mandal, Visakhapatnam. 47% of the total area is
classified as Non-SEZ and 20% as SEZ. The initial total project
cost was INR474.16 crore which was funded through INR18 crore
equity, INR178 crore term loans and remaining INR278.16 crore
through lease deposits. Considering lease deposits as equity, the
D/E ratio is 0.60 times. There has been cost escalation by around
INR50 crore which is yet to be incurred.
Recent Results
As per the audited financials for FY!5, the company reported
operating income of INR75.18 crore and PAT of INR1.08 crore
against INR122.75 crore and INR1.08 crore respectively for FY14.
RIA HOTELS: ICRA Suspends B- Rating on INR17.5cr Loan
-----------------------------------------------------
ICRA has suspended the long term rating of [ICRA]B- on the
INR17.50 crore bank lines of Ria Hotels Private Limited. The
suspension follows ICRA's inability to carry out a rating
surveillance in the absence of the requisite information from the
company.
RUPESH & COMPANY: ICRA Suspends B+ Rating on INR7cr Loan
--------------------------------------------------------
ICRA has suspended the long-term rating of [ICRA]B+ assigned to
the INR7.00 crore bank facilities of Rupesh & Company. The
suspension follows ICRA's inability to carry out a rating
surveillance in the absence of the requisite information from the
firm.
S.P.P FOOD PRODUCTS: Ind-Ra Suspends 'IND BB+' LT Issuer Rating
---------------------------------------------------------------
India Ratings and Research (Ind-Ra) has migrated S.P.P Food
Products Private Limited's 'IND BB+' Long-Term Issuer Rating to
the suspended category. The Outlook was Stable. This 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 of S.P.P Food Products.
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.
S.P.P Food Products' ratings:
-- Long-Term Issuer Rating: migrated to 'IND BB+(suspended)'
from 'IND BB+'
-- INR46.6 million term loan limits: migrated to 'IND
BB+(suspended)' from 'IND BB+'
-- INR100 million fund-based limits: migrated to 'IND
BB+(suspended)' from 'IND BB+' and 'IND A4+(suspended)' from
'IND A4+'
-- INR35 million non-fund-based limits: migrated to 'IND
BB+(suspended)' from 'IND BB+' and 'IND A4+(suspended)' from
'IND A4+'
S.R.CONSTRUCTIONS: ICRA Suspends B Rating on INR15cr Loan
---------------------------------------------------------
ICRA has suspended [ICRA]B rating assigned to the INR15.00 crore
fund based facilities, and INR7.00 unallocated limits of
S.R.Constructions. ICRA has also suspended [ICRA]A4 rating
assigned to the INR100.00 crore non-fund based limits of
S.R.Constructions. The suspension follows ICRA's inability to
carry out a rating surveillance in the absence of the requisite
information from the company.
Company Profile
M/s. SR Constructions incorporated as a partnership firm in the
year 1998 is into providing construction services as a contractor,
mainly to government departments. It undertakes irrigation, civil
and structural works for public infrastructure & residential
buildings etc. in India. The firm has its registered office in
Anantapur, Andhra Pradesh and an administrative office in
Bangalore, Karnataka.
SADHANA SUITINGS: CARE Assigns B+ Rating to INR8.25cr LT Loan
-------------------------------------------------------------
CARE assigns 'CARE B+' rating to the bank facilities of Sadhana
Suitings Private Company.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank Facilities 8.25 CARE B+ Assigned
Rating Rationale
The rating assigned to the bank facilities of Sadhana Suitings
Private Limited (SSPL) is primarily constrained on account of
its nascent stage of operations in a highly competitive and
fragmented textile industry and vulnerability of margins to
fluctuation in the raw material prices.
The rating, however, favourably takes into account experienced
management with synergic benefit from group concern and its
location advantage by virtue of being situated in the textile
cluster of Bhilwara.
The ability of the company to stabilize its operations with
achievement of envisaged TOI and profitability are the key
rating sensitivities.
Bhilwara-based (Rajasthan) SSPL was incorporated in 2014 by Mr
Anil Kumar Chordia andMr Sunil Kumar Chordia along with their
family members. SSPL was formed with a purpose to establish a unit
for manufacturing of synthetics grey fabrics at Bhilwara. The
company has completed its project in September 2015 and started
commercial production from October 2015. It had incurred INR9.90
crore towards the project which was financed through share capital
of INR2.05 crore including share premium, term loan of INR6.75
crore and the remaining through unsecured loans. It has installed
capacity of 3 LakhMeter Per Month (LMPM) having 24 airjet looms as
on December 31, 2015. In FY15 ( refers to the period April 1 to
March 31), the company has got finished fabrics on job work basis
from other processing house and sold in the market.
The promoters have also promoted Sadhana Sulzfab Private Limited
(Sadhana) which is engaged in manufacturing of synthetics fabrics.
During FY15, SSPL has registered TOI of INR0.27 crore with PAT of
INR19,000 being the first year of operations.
SAI-LAXMI TEXOFAB: ICRA Reaffirms 'B' Rating on INR6.50cr Loan
--------------------------------------------------------------
ICRA has reaffirmed the long-term rating of [ICRA]B to the INR6.50
crore (reduced from INR6.65 crore) fund based bank limits and the
short term rating of [ICRA]A4 to the INR0.16 crore non fund based
bank limit of Sai-Laxmi Texofab. ICRA has also assigned ratings of
[ICRA]B and/or [ICRA]A4 to the INR0.15 crore unallocated limit of
SLT.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Fund
Based Limits 6.50 [ICRA]B Reaffirmed
Short-term Non
fund Based Limit 0.16 [ICRA]A4 Reaffirmed
Unallocated limit 0.15 [ICRA]B and/or [ICRA]A4
Assigned
The reaffirmed ratings continue to reflect the weak financial
profile of SLT, characterized by fall in operating income on
account of decline in sales volume, thin profitability, high
gearing levels and stretched liquidity following its working
capital intensive nature of operations. The ratings are also
constrained on account of vulnerability of profit margins to
volatility in raw material prices and the high competitive
pressure prevailing in the industry because of the presence of
many unorganized players. Further, SLT is a partnership concern
and withdrawals from the capital account have affected its capital
structure in the past.
However, the ratings favorably factor in the promoter's long track
record in the textile industry and location advantages due to its
presence in the textile belt of Surat.
Sai-Laxmi Texofab (SLT) started operations in 2002 and is involved
in texturising of yarn and manufacturing of grey cloth. Its
registered office and its manufacturing facility for grey cloth
are located at Surat city, while the facility for yarn is located
at Kim village, Surat.
Recent Results
The firm recorded a net profit of INR0.35 crore on an operating
income of INR39.17 crore for the year ending March 31, 2015.
SAIKRUPA FIBRES: Ind-Ra Suspends 'IND B-' Long-Term Issuer Rating
----------------------------------------------------------------
India Ratings and Research (Ind-Ra) has migrated Saikrupa Fibres
Pvt Ltd's (SFPL) '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 ratings have been migrated to the suspended category due to
lack of information. Ind-Ra will no longer provide ratings or
analytical coverage for SFPL.
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.
SFPL's ratings are as follows:
-- Long-Term Issuer rating: migrated to 'IND B-(suspended)' from
'IND B-'
-- INR90 million fund-based working capital limit: migrated to
'IND B-(suspended)' from 'IND B-'
-- INR40 million term loan: migrated to 'IND B-(suspended)' from
'IND B-'
SANGAM STEELS: CARE Assigns 'B' Rating to INR7cr LT Loan
--------------------------------------------------------
CARE assigns 'CARE B' rating to the bank facilities of Sangam
Steels.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank Facilities 7 CARE B Assigned
Rating Rationale
The rating assigned to the bank facilities of Sangam Steels (SS)
is primarily constrained by its declining operating income, low
profitability margins and weak overall solvency position. The
rating is further constrained by the working capital intensive
nature of operations, risk associated with the sole proprietorship
nature of constitution and the inherent cyclicality in the steel
industry. The rating, however, derives strength from the
experience of the promoters, established track record of
operations and association with well-known steel manufacturers.
Going forward, the ability of the company to increase its scale of
operations along with improvement in profitability margins and the
overall solvency position would remain the key rating
sensitivities.
Sangam Steels (SS) was incorporated in 1983 by Mr Sandeep Gupta,
as a proprietorship concern. The firm is an authorized dealer of
JSW Steel Limited, since 1999, and is engaged in the distribution
of steel products (HR sheets, rounds etc.), for the company. The
firm is also engaged in the distribution of steel products like
wires, coils, rods, bars etc. for Steel Authority of India Ltd.
(SAIL), with whom it is associated since 2010. These products,
primarily sold in the Punjab region, find application in
bicycle parts, automobile components, etc.
In FY15 (refers to the period April 01 to March 31), SS achieved a
total operating income of INR 75.04 crore with a PAT of INR0.12
crore as against the total operating income of INR78.80 crore PAT
of INR0.09 crore for FY14.
SANJAY INDUSTRIAL: Ind-Ra Suspends 'IND B+' LT Issuer Rating
------------------------------------------------------------
India Ratings and Research (Ind-Ra) has migrated Sanjay Industrial
Steels (Bhopal) Pvt. Ltd.'s (SISPL) '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 SISPL.
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.
SISPL's ratings:
-- Long-Term Issuer Rating: migrated to 'IND B+(suspended)' from
'IND B+'/Stable
-- INR80 million fund-based limits: migrated to 'IND
B+(suspended)'from 'IND B+'
SHIVAM MOTORS: ICRA Reaffirms B+ Rating on INR38cr Cash Loan
------------------------------------------------------------
ICRA has reaffirmed [ICRA]B+/A4 for the INR78.0 Crore bank
facilities of Shivam Motors Private Limited. The outlook on the
long term rating is 'Stable'.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Cash Credit 38.00 [ICRA]B+ reaffirmed
Inventory Funding 15.00 [ICRA]B+ reaffirmed
Over Draft 3.00 [ICRA]A4 reaffirmed
Long-term/Short-
term Unallocated 22.0 [ICRA]B+/A4 reaffirmed
The rating reaffirmation continues to take into account the
competitive position of SMPL as the sole dealer of Tata Motors
Limited's (TML) commercial vehicles in seven districts of
Chhattisgarh, the dealership's long standing relationship with the
OEM and the promoter's strong experience of over three decades in
the automobile dealership business. Although the demand for light
commercial vehicles and small commercial vehicles declined
significantly in FY15, higher income from sale of medium and heavy
commercial vehicles, built bodies and incentives supported the
dealership's revenues and profitability.
The ratings continue to be constrained by the inherent cyclicality
in the commercial vehicle segment, thin profitability margins and
high working capital requirements that are inherent in the
automobile dealership business. The ratings also factor in the
dealership's leveraged capital structure and consequently moderate
debt coverage indicators. The ability of the company to capitalize
on the recovery of commercial vehicle sales, stabilize margins and
increase sales from higher margin segments like service income and
spare parts will remain the key rating sensitivities.
Recent Results
In FY15, SMPL recorded an operating income of INR350.6 crore and
an operating profit before depreciation, interest and tax of
INR9.9 crore. The company recorded a net profit of INR0.3 crore.
SMPL is the sole supplier of TML commercial vehicles and spare
parts in seven districts of Chhattisgarh, namely, Bilaspur, Korba,
Janjgir, Surguja, Koriya, Raigarh and Jashpur. The company was
incorporated in 1983 by Mr. Kailash Gupta as its key director and
other family members - Mr. Prem Chand Gupta and Mrs. Shalini Gupta
as directors.
SMPL is one of the several companies led by Mr. Kailash Gupta. The
flagship company of the group is Commercial Automobiles Private
Limited (CAPL), a dealership of TML CVs and PVs in Madhya Pradesh.
Another group company of SMPL is Commercial Engineers and Body
Builders Company Limited (CEBBCO), which manufactures bodies for
commercial vehicles.
SHREE RAJASVI: CRISIL Lowers Rating on INR160MM Loan to 'B-'
------------------------------------------------------------
CRISIL has downgraded its rating on the long term bank facilities
of Shree Rajasvi Polyesters to 'CRISIL B-/Stable' from 'CRISIL
B/Stable'.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 160 CRISIL B-/Stable (Downgraded
from 'CRISIL B/Stable')
Proposed Long Term 20.3 CRISIL B-/Stable (Downgraded
Bank Loan Facility from 'CRISIL B/Stable')
Term Loan 21.8 CRISIL B-/Stable (Downgraded
from 'CRISIL B/Stable')
The downgrade reflects deterioration in Rajasvi's credit profile,
marked by an expected elongation in working capital cycle and
lower cash accruals. While Rajasvi's net sales are expected to
remain stable at over INR 850 million for 2015-16 (refers to
financial year, April 1 to March 31); the firm's working capital
requirements are expected to increase with expected gross current
asset (GCA) days of over 150 days as on March 31, 2016 as against
GCA days of 125 days as on March 31, 2015, emanating primarily
from increased receivables. Increasing working capital
requirements will enhance firm's dependence on external
borrowings, leading to higher interest costs. Further, the
entity's annual term repayment obligations of about INR 7.5
million continue to remain high against expected cash accruals
over the medium term. CRISIL believes that the level of operating
profitability along with the extent of promoter fund support will
remain key monitorables over the medium term.
The ratings continue to reflect Rajasvi's below-average financial
risk profile, marked by high gearing and weak debt protection
metrics, and its modest scale and working-capital-intensive nature
of operations. These rating weaknesses are partially offset by the
extensive experience of the firm's partners in the yarn industry.
Outlook: Stable
CRISIL believes that Rajasvi will continue to benefit over the
medium term from its partners' extensive industry experience and
their funding support. The outlook may be revised to 'Positive' in
case of improvement in the firm's liquidity, most likely due to
substantial capital infusion or a considerable improvement in
revenue and profitability, resulting in much higher cash accruals.
Conversely, the outlook may be revised to 'Negative' if Rajasvi's
financial risk profile, especially its liquidity, deteriorates,
owing to a stretch in its working capital cycle, lower-than-
expected net cash accruals, or a sizeable withdrawal from
partners' capital.
Rajasvi manufactures texturised and twisted polyester yarn from
POY. The firm's manufacturing facilities are in Surat (Gujarat).
It also acts as a del credere agent for selling POY of Garden Silk
Mills Pvt Ltd. Rajasvi was set up in 2010 by Mr. Naresh Gandhi and
his family by dissolving multiple entities and consolidating their
operations under Rajasvi.
SHREERANGAM PACKAGING: CARE Reaffirms B+ Rating on INR9.71cr Loan
-----------------------------------------------------------------
CARE reaffirms the rating assigned to the bank facilities of
Shreerangam Packaging Pvt. Ltd.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank Facilities 9.71 CARE B+ Reaffirmed
Rating Rationale
The rating assigned to the bank facilities of Shreerangam
Packaging Private Limited (SPPL) continues to remain constrained
on account of its low profitability, weak liquidity position with
long inventory holding. The ratings are further constrained on
account of high competition in the packaging industry along with
susceptibility of margins to volatility in prices of raw
materials. The ratings take into account the increase in total
operating income (TOI) with net loss, deterioration in capital
structure and debt coverage indicator during FY15 (refers to the
period April 1 to March 31).
The ratings, however, continue to derive strength from vast
experience of the promoter and well established track record of
operations of SPPL.
The ability of SPPL to increase the scale of operations, improve
profitability and capital structure with efficient management of
its working capital requirements remain the key rating
sensitivities.
Shreerangam Packaging Private Limited (SPPL) was incorporated on
September 4, 1991 by three key promoters i.e. Mr Bharat Patel, Mr
Kirit Patel and Mr Ramakant Patel. SPPL is engaged in designing,
printing & packaging of wide range of corrugated boxes and printed
cartons. It is an ISO 9001:2008 certified company and caters to
various industries such as ceramic tiles, food & beverages,
cosmetics and pharmaceuticals. The unit of SPPL is spread over an
area of 30,000 sq. mtr having an installed
capacity of 5 metric tonne (MT) per month located at Ahmedabad-
Viramgam highway, Gujarat.
SPPL produces variety of corrugated boxes such as "E" Flute,
"Narrow Flute and "Broad" Flute corrugation kraft paper in the
range of 12 to 28 Busting Factor (BF). SPPL also manufactures
Offset Printed Duplex Boxes with "E" fluted Corrugation with Glue
Pasting and Bottom Lock.
SHRI RAMESHWAR: CRISIL Lowers Rating on INR300MM Loan to C
----------------------------------------------------------
CRISIL has downgraded its rating on the bank facility of Shri
Rameshwar Sahakari Sakhar Karkhana Limited (SRSSKL) to 'CRISIL C'
from 'CRISIL B-/Stable'.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 300 CRISIL C (Downgraded from
'CRISIL B-/Stable')
The downgrade reflects SRSSKL's weak liquidity due to continued
substantial cash losses and working capital-intensive operations.
Continued low realisations and increasing financing costs will
lead to considerable cash losses of close to INR70 million in
2015-16 (refers to financial year, April 1 to March 31) as well.
While the company does not have any debt repayments in 2016-17,
the interest coverage ratio will remain under pressure owing to
low operating margin and high interest expenses.
The rating reflects the society's below-average financial risk
profile, because of weak capital structure and inadequate debt
protection metrics, and its exposure to risks related to
cyclicality in the sugar industry and regulatory framework. These
rating weakness are partially offset by the established regional
position of SRSSKL in the sugar industry.
SRSSKL, set up in 2001, is a co-operative society that
manufactures sugar. It is based in Jalna (Maharashtra). Mr.
Santosh Patil Danve is the chairman of the society and the day-to-
day operations are managed by Mr. Dharmaraj Shewale (managing
director) with support from other functional personnel.
SHRISHTI TECHNOLOGIES: ICRA Reaffirms B+ Rating on INR6cr Loan
--------------------------------------------------------------
ICRA has reaffirmed its long-term rating of [ICRA]B+ on the
INR6.00 crore fund based bank limits of Shrishti Technologies.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Fund Based Limits 6.00 [ICRA]B+; reaffirmed
The rating reaffirmation takes into account the 13% year-on-year
growth in Operating Income registered by the company in FY2015,
which was also accompanied by some improvement in margins.
However, the company's gearing and coverage indicators remained
broadly at the same levels as last year.
ICRA's ratings continue to take into account the long experience
of the promoters in the electric fan manufacturing business and
healthy revenue growth witnessed in the past. The revenue growth
is driven mainly by addition of newer customers i.e., Luminous
Power Technologies Private Limited, Maharaja Whiteline Industries
Private Limited, in addition to strong order inflow from existing
clientele. The rating continues to be constrained by the firm's
relatively modest scale of operations in its business of
manufacturing and assembling electric fans, and the firm's
moderate profitability levels owing to low value additive nature
of its core business. The firm remains exposed to customer
concentration risk as a single customer accounted for around 70%
of its total sales in the first nine months of FY2016. The rating
is further constrained by the relatively high gearing levels of
the firm, primarily owing to high working capital debt coupled
with the firm's modest net worth.
Going forward, the ability of the firm to increase its scale of
operations, diversify its customer base while improving
profitability, will be the key rating sensitivities.
Shrishti Technologies is a partnership firm which was incorporated
in 2004 by the Tibrewal family and has its manufacturing facility
in Baddi, Himachal Pradesh. The firm is engaged in the assembling
and manufacturing of electric fans for Bajaj Electricals Limited,
Luminous Power Technologies Private Limited, Maharaja Whiteline
Industries Private Limited and Anchor Electricals Private Limited.
Recent Results
For FY2015, the firm achieved an operating income of INR81.43
crore and a net profit of INR0.43 crore, as against an operating
income of INR71.83 crore and a net profit of INR0.46 crore for the
previous year.
SIDDHARTH EXPORTS: ICRA Assigns B+ Rating to INR4.0cr Loan
----------------------------------------------------------
ICRA has assigned its rating of [ICRA]B+ to the INR4.65 crore long
term fund based facilities and short term rating of [ICRA]A4 to
the INR2.70 crore non fund based facilities of Siddharth Exports.
ICRA has also assigned its rating of [ICRA]B+/A4 to the INR2.65
crore unallocated limits of Siddharth Exports.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Fund Based Limits
Term Loan 0.65 [ICRA]B+; assigned
Fund Based Limits
Packing Credit 4.00 [ICRA]B+; assigned
Non Fund Based
Limits 2.70 [ICRA]A4; assigned
Unallocated Limits 2.65 [ICRA]B+/A4; assigned
ICRA's assigned ratings are constrained by the moderate scale of
operations of the company (with operating income of INR35.71 crore
during 2014-15). The ratings also factor in the vulnerability of
profitability to increase in prices of major raw materials and the
variations in foreign exchange rates as sales comprise entirely of
exports. Further, the ratings also take into account the risky
financial profile characterised by high gearing and tight
liquidity position as reflected by full utilisation of working
capital limits and the risks associated with proprietorship form
of business in terms of continuity, capital infusions and
withdrawals. However, the ratings favourably factor in the long
and established track record of promoters in the footwear
industry, the established contacts with reputed international
brands helps in smooth running of operations and the healthy
profitability margins over the last few years.
Going forward the ability of the company to increase its scale of
operations while maintaining moderate gearing levels and debt
coverage indicators would remain the key rating sensitivities.
The firm was established as a proprietorship concern in 1993 by Mr
Sunil Harjai and is engaged in the business of manufacturing and
export of leather shoes for both men and women. The manufacturing
facility of the firm is located in Noida, Uttar Pradesh and is
well equipped with the requisite equipments.
As per the audited financials for 2014-15, the firm reported a net
profit of INR2.61 crore on an operating income of INR35.71 crore
as against a net profit of INR2.71 crore on an operating income of
INR31.17 crore in 2013-14.
SIRIUS INFRA: CARE Reaffirms 'D' Rating on INR5cr Loan
------------------------------------------------------
CARE reaffirms the rating assigned to the bank facilities of
Sirius Infra Projects Private Limited.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank Facilities 4 CARE D Reaffirmed
Short-term Bank Facilities 5 CARE D Reaffirmed
Rating Rationale
The ratings assigned to the bank facilities of Sirius Infra
Projects Private Limited (SIPPL) continue to be constrained by
continued overdrawals in the fund-based limits and regular
invocations of bank guarantee on account of stressed liquidity
position of the company.
SIPPL was promoted by Mr B Narsimha Reddy and Mr Rajeev Mayor in
2008. The company is engaged in civil construction works such as
laying of roads and irrigation works for government organizations
covering the states of Madhya Pradesh and Odisha. Till March 2011,
the company used to work as a sub-contractor for Patel Engineering
Limited and KNR Constructions Limited, whereas from April 2012
onwards, the company started participating in tenders and
executing the projects directly for the government. The company
has executed around INR12.98 crore for Madhya Pradesh Road
Development Corporation Limited (MPRDCL) (road work) during FY13
(refers to the period April 1 to March 31).
During FY15, SIPPL reported a PAT of INR2.34 crore on a total
operating income of INR49.44 crore as against net profit of
INR1.81 crore on a total operating income of INR31.25 crore in
FY14.
SMITABH INTERCON: Ind-Ra Suspends IND B- Long-Term Issuer Rating
----------------------------------------------------------------
India Ratings and Research (Ind-Ra) has migrated Smitabh Intercon
Ltd.'s (SIL) '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 SIL.
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.
SIL's ratings are as follows:
-- Long Term Issuer Rating: migrated to 'IND B-(suspended)' from
'IND B-'/Stable
-- INR20 million fund-based limit: migrated to 'IND B-
(suspended)' from 'IND B-'
-- INR30 million non-fund based limit: migrated to 'IND
A4(suspended)' from 'IND A4'
SOWBHAGYA ISPAT: Ind-Ra Suspends 'IND D' Long-Term Issuer Rating
----------------------------------------------------------------
India Ratings and Research (Ind-Ra) has suspended Sowbhagya Ispat
India Private Limited (SIIPL) 'IND D' Long-Term Issuer Rating to
the suspended category. This rating will now appear as 'IND D
(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 SIIPL.
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.
SIIPL's ratings are as follows:
-- Long-Term Issuer Rating: migrated to 'IND D(suspended)' from
'IND D'
-- INR49.4 million long-term loan: migrated to Long-term 'IND
D(suspended)' from 'IND D'
-- INR150 million fund-based working capital limits: migrated to
Long-term/Short-term 'IND D(suspended)' from 'IND D'
SRI GOWRI: CRISIL Assigns B+ Rating to INR60MM Cash Loan
--------------------------------------------------------
CRISIL has assigned its 'CRISIL B+/Stable' rating to the long-term
bank facilities of Sri Gowri Cashews (SGC).
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Term Loan 15 CRISIL B+/Stable
Cash Credit 60 CRISIL B+/Stable
Proposed Long Term
Bank Loan Facility 5.1 CRISIL B+/Stable
The rating reflects SGC's modest scale of operations in the
intensely competitive cashew industry and below-average financial
risk profile, marked by high gearing and average debt protection
metrics. These rating weaknesses are partially offset by the
proprietor's extensive experience in the cashew industry and
established relationships with suppliers.
Outlook: Stable
CRISIL believes SGC will benefit over the medium term from its
proprietor's extensive experience in the cashew industry. The
outlook may be revised to 'Positive' if considerable increase in
revenue and profitability leads to better cash accruals and a
stronger financial risk profile. Conversely, the outlook may be
revised to 'Negative' if low revenue or profitability, weakening
in working capital management, or any large, debt-funded capital
expenditure considerably constrains the financial risk profile.
Set up as a proprietorship firm in 2006, SGC processes raw cashew
nuts and sells cashew kernels. Its facility in Udupi District,
Karnataka, has capacity to process around 8 tonnes of cashew
kernels per day. The operations are managed by the proprietor, Mr.
Mohan Das Hegde.
Profit after tax (PAT) and net sales increased to INR2.2 million
and INR126.6 million, respectively, for 2014-15 (refers to
financial year, April 1 to March 31) from INR1.7 million and
INR81.3 million for 2013-14.
SRI LAKSHMI: ICRA Reaffirms 'B' Rating on INR5.50cr Cash Loan
-------------------------------------------------------------
ICRA has reaffirmed the long-term rating of [ICRA]B to INR5.50
Crore Cash Credit and INR2.27 crore Term Loan facilities of Sri
Lakshmi Poultry Farms.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Cash Credit 5.50 [ICRA]B; re-affirmed
Term Loan 2.87 [ICRA]B; re-affirmed
The rating re-affirmation takes into account the small scale of
operations in the poultry farming business with weak financial
profile as reflected in decline in operating income in FY2015 on
account of lower eggs produced as most of the birds were in non-
laying stage in the starting months of FY 2015 which was on
account of disease outbreak in December, 2013, high gearing, and
stretched coverage indicators. The rating also considers high
working capital intensity in FY2015 on account of high inventory
leading to constrained liquidity position as indicated in high
average utilization of working capital limits (99%) over the past
12 months. The rating factors in the cyclicality associated with
the poultry industry, resultant table egg price volatility and
vulnerability of profits to fluctuation in prices of feed
(primarily maize, broken rice and soya), which accounts for more
than 75% of manufacturing cost. The ratings, however, draws
comfort from the vast experience of the management in the poultry
farming and the healthy demand outlook for the layer eggs on
account of increasing acceptance of eggs as a daily meal
component.
Going forward the ability of company to scale up the operations
and improve capital structure while effectively managing the
working capital requirements would be key rating sensitivities.
Sri Lakshmi Poultry Farm (SLPF) was incorporated as a partnership
firm during the year 2007. The firm is engaged in the business of
commercial layer poultry farming and currently operates through
facilities located in Brahmanagudem Village and Chikkala Village
with total capacity of 2,80,000 commercial layers.
Recent Results
As per the audited financial for FY2015 the firm registered PAT of
INR0.04 crore on an operating income of INR13.62 crore as against
the PAT of INR0.06 crore on an operating income of INR18.46 crore
in FY2014.
SRI SRINIVASA: ICRA Suspends B+ Rating on INR4.80cr Loan
--------------------------------------------------------
ICRA has suspended the long term rating of [ICRA]B+ assigned to
INR4.80 crore cash credit facility and INR1.20 crore term loan of
Sri Srinivasa Ginning Mill. The suspension follows ICRA's
inability to carry out a rating surveillance in the absence of the
requisite information from the company.
According to its suspension policy, ICRA may suspend any rating
outstanding if in its opinion there is insufficient information to
assess such rating during the surveillance exercise.
Sri Srinivasa Ginning Mill (SSGM) is engaged in cotton ginning and
pressing with the product mix of cotton bales and cottonseed. SSGM
was incorporated as a proprietorship firm in the year 2006 by Mr.
M. Srinivasa Rao and was converted into partnership firm in 2012.
It has its production facilities at Pulladigunta, Guntur District
of Andhra Pradesh. Prior to 2009, the firm has done job works for
Cotton Corporation of India and started its ginning operations
from 2009 onwards. The firm has 12 ginning machines with intake
capacity of 576 Quintal/day.
SRINIVASA AGRO: Ind-Ra Assigns 'IND BB-' Long-Term Issuer Rating
----------------------------------------------------------------
India Ratings and Research (Ind-Ra) has assigned Srinivasa Agro
Products (SAP) a Long-Term Issuer Rating of 'IND BB-'. The Outlook
is Stable. The agency has also assigned NCJ's INR180 million fund-
based working capital facility a Long-term rating of 'IND BB-'
with a Stable Outlook and a Short-term rating of 'IND A4+'.
KEY RATING DRIVERS
The ratings reflect SAP's small scale of operations, low yet
stable profitability and moderate credit metrics. Revenue was
INR771 million in FY15 (FY14: INR652m) with EBITDA margins in the
range of 2%-3%. Net leverage during FY15 was 4.7x (FY14: 5.7x) and
EBITDA interest coverage was 1.4x (1.7x).
The ratings are supported SAP's comfortable liquidity position
with the fund-based facilities being utilised at an average of 68%
over the 12 months ended October 2015.
The ratings are also supported by SAP's promoters' two-decade-long
experience in processing cotton oil.
RATING SENSITIVITIES
Positive: Substantial growth in the top line and stable
profitability leading to a sustained improvement in the credit
metrics and a comfortable liquidity position will lead to a
positive rating action.
Negative: Any further decline in profitability resulting in a
sustained deterioration in credit profile of the company will lead
to a negative rating action.
COMPANY PROFILE
Incorporated in 1991, SAP is engaged in the delintering and
processing of cotton seeds. Its 160 million tons/day manufacturing
facility is located in Guntur, Andhra Pradesh.
SUPREME BEST: Ind-Ra Cuts INR2.4BB Term Loan Rating to 'IND D'
--------------------------------------------------------------
India Ratings and Research (Ind-Ra) has downgraded Supreme Best
Value Kolhapur (Shiroli) Sangli Tollways Private Limited's
(SKSTPL) INR2,475 million term loan to 'IND D' from 'IND B+'. The
Outlook was Negative.
KEY RATING DRIVERS
The downgrade reflects SKSTPL's delays in debt servicing for a
period up to 180 days on 31 March 2015, as reported in the audited
financial statements shared with Ind-Ra for FY15.
RATING SENSITIVITIES
Timely debt servicing for three consecutive months could result in
a positive rating action.
COMPANY PROFILE
SKSTPL was set up by Supreme Infrastructure BOT Holdings Private
Limited, a subsidiary of Supreme Infrastructure India Ltd ('IND
D') to complete the construction of, and operate and maintain, the
52km stretch of state highway connecting Shiroli and Sangli under
a concession from the Public Works Department, the government of
Maharashtra.
SUPREME SUYOG: Ind-Ra Cuts INR500M LT Sr. Proj. Loan to 'IND D'
---------------------------------------------------------------
India Ratings and Research (Ind-Ra) has downgraded Supreme Suyog
Funicular Ropeways Private Ltd.'s (SSFRPL) INR500 million long-
term senior project bank loan to 'IND D' from 'IND B+'. The
Outlook was Negative.
KEY RATING DRIVERS
The downgrade reflects SSFRPL's delays in debt servicing for a
period of more than 31 days, as reported in the audited financial
statements shared with Ind-Ra for FY15.
RATING SENSITIVITIES
Timely debt servicing for three consecutive months could result in
a positive rating action.
COMPANY PROFILE
SSFRPL is an SPV, incorporated to construct a funicular railway at
Haji Malang Gad, Ambernath (Maharashtra) on a build, operate and
transfer basis under a 24-year and five months concession
agreement with the government of Maharashtra. SSFRPL is sponsored
by Supreme Infra BOT Private Limited (98%), a 100% subsidiary of
Supreme Infrastructure India Ltd,('IND D'), Suyog Telematics
Private Ltd (1%) and Yashita Automotive Engineering Private Ltd
(1%).
SURYA COTTON: CARE Reaffirms B+ Rating on INR7.56cr LT Loan
-----------------------------------------------------------
CARE reaffirms the rating assigned to the bank facilities of
Surya Cotton Industries.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank Facilities 7.56 CARE B+ Reaffirmed
Rating Rationale
The rating assigned to the bank facilities of Surya Cotton
Industries (SCI) continues to remain constrained on account of
its financial risk profile marked by decline in the total
operating income (TOI) during FY15 (refers to the period April 1
to March 31), thin profit margins, leveraged capital structure and
weak debt coverage indicators. The rating continues to remain
constrained on account of its constitution as a partnership firm,
its working capital intensive nature of operations and
vulnerability of profits to fluctuations in the raw material
prices along with government regulations for price and
supply of cotton.
The rating, however, continues to derive benefits from the vast
experience of partners in the cotton industry and location
advantage.
The ability of SCI to increase the scale of operations along with
an improvement in profit margins and capital structure
while managing its working capital requirements efficiently are
the key rating sensitivities.
SCI was established in October 2011 as a partnership concern by
five partners. SCI is engaged in cotton ginning and pressing. SCI
is into the business of manufacturing of cotton bales, cotton seed
cake and cotton seed oil with installed capacity of 1,500 metric
tonnes per annum (MTPA), 2,800 MTPA and 336 MTPA, respectively.
During FY15, SCI reported a total operating income (TOI) of
INR30.05 crore with Profit After Tax (PAT) of INR0.03 crore as
compared with TOI of INR34.98 crore and PAT of INR0.07 crore
during FY14. During 9MFY16 (Provisional), SCI has achieved a
turnover of INR17.97 crore.
SURYAVANSHI SPINNING: ICRA Revises Rating on INR48cr Loan to B
--------------------------------------------------------------
ICRA has revised the ratings assigned to the INR117.41 crore bank
facilities of Suryavanshi Spinning Mills Ltd. to [ICRA]B/[ICRA]A4
from [ICRA]BB (stable)/[ICRA]A4+ assigned earlier.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Term loans 31.04 [ICRA]B revised
Cash credit limits 48.00 [ICRA]B revised
Long term non fund
based limits 2.00 [ICRA]B revised
Short term non fund
based limits 31.25 [ICRA]A4 revised
Unallocated 5.12 [ICRA]B/A4 revised
The rating revision factors in the deterioration in the financial
risk profile of SVSML during 9mFY16 with operating profitability
declining to 4.28% against 5.63% for 9m FY15 coupled with
increased interest expenses resulting in cash losses and
deterioration in interest cover (OBITDA/interest charges) to 0.81
times for 9mFY16 against 1.33 times for 9mFY15. Overall risk
profile of the company deteriorated post merger (effective August
2014) ) owing to significant decline in scale of operations in a
highly competitive and fragmented spinning industry with SVSML
retaining 36912 spindles; 33% of the earlier installed capacity.
SVSML now manufactures only polyester and poly-viscose yarn along
with the medical textiles unlike the diversified product profile
of SVSML before demerger comprising blended, synthetic and cotton
yarn along with garments and medical textiles. Further the capital
structure of the entity after demerger continued to remain
stretched with gearing of 2.59 times as on year end FY15. This
coupled with decline in scale of operations resulted in
deterioration in coverage indicators with NCA/Debt of 6% and
Debt/OBITDA of 5.61 times for FY15. Nevertheless ICRA continues to
take comfort from the long track record of operations of over four
decades of SVSML along with location advantage of the unit leading
to savings on logistics.
SVSML was established in 1978 and had been engaged in the
production of yarn and garments with installed spinning capacity
of 1,11,584 spindles and 21 lakh pieces of garments annually
spread at three facilities - Bhongir (Telangana), Aliabad
(Telangana) and Rajna (Madhya Pradesh). During FY14-15, Hon'ble
High Court at Hyderabad vide its Order dated 30th July 2014
sanctioned the demerger scheme 2(19AA) of the Income tax Act,1961
. The said Orders of the Hon'ble High Court were filed with
Registrar of Companies,at Hyderabad on August 21, 2014 (Effective
Date). The company continued to retain the residual business of
yarn unit for 36912 spindles and Medical textile unit at Aliabad,
in the state of Telangana. SSML is now in the business of
manufacturing of Polyester, polyester-viscose Blended Yarns and
Medical Textiles Products catering to both domestic and the export
markets.
Recent Results
During 9mFY16, SVSML reported PAT loss of INR1.48 crore on an
operating income (OI) of INR76.34 crore as against PAT of INR0.29
crore on an operating income of INR106.35 crore for FY14-15.
SWADESHI TEXTILES: Ind-Ra Assigns 'IND B' Long-Term Issuer Rating
----------------------------------------------------------------
India Ratings and Research (Ind-Ra) has assigned Swadeshi Textiles
Private Limited (STPL) a Long-Term Issuer Rating of 'IND BB-'. The
Outlook is Stable.
KEY RATING DRIVERS
The ratings reflect STPL's stressed liquidity as evident from its
more than 99% utilisation of the working capital limits on an
average during the six months ended January 2016.
The ratings are constrained by STPL's low revenue base and weak
credit metrics. In FY15, revenue was INR427m (FY14: INR559m), net
financial leverage (total adjusted net debt/operating EBITDA) was
6.4x (6.7x) and EBITDA interest coverage was 1.9x (1.7x).
The ratings are, however, supported by over 15 years of experience
of STPL's promoters in manufacturing fabrics.
RATING SENSITIVITIES
Positive: An improvement in the scale of operations along with
overall credit metrics could be positive for the ratings.
Negative: Further deterioration in the credit profile along with
overall liquidity profile could be negative for the ratings.
COMPANY PROFILE
Mumbai-based STPL was incorporated in 2001. The company
manufactures interlining fabric and wide width fabric.
STPL's ratings are as follows:
-- Long-Term Issuer Rating: assigned 'IND BB-'/Stable
-- INR60.0 million fund-based working capital limits: assigned
'IND BB-'/Stable
-- Proposed INR40.0 million fund-based working capital limits:
assigned 'Provisional IND BB-'/Stable
-- INR2.0 million non-fund-based working capital limits:
assigned 'IND A4+'
SWASTIK CEMENT: Ind-Ra Suspends 'IND BB-' Long-Term Issuer Rating
----------------------------------------------------------------
India Ratings and Research (Ind-Ra) has migrated Swastik Cement
Products Private Limited's 'IND BB-' Long-Term Issuer Rating to
the suspended category. The Outlook was Stable. This 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 of Swastik Cement Products Private
Limited.
he 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.
Swastik Cement Products Private Limited's ratings:
-- Long-Term Issuer Rating: migrated to 'IND BB-(suspended)'
from 'IND BB-
-- INR54.5 million fund-based limits: migrated to 'IND BB-
(suspended)' from 'IND BB-' and 'IND A4+ (suspended)' from
'IND A4+'
TARACHAND INTERNATIONAL: CARE Revises Rating on INR50cr Loan to D
-----------------------------------------------------------------
CARE revises the ratings assigned to the bank facilities of
Tarachand International Private Limited.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term/Short term 50.00 CARE D Revised from
Bank Facilities CARE B/CARE A4
Rating Rationale
The revision in rating assigned to the bank facilities of
Tarachand International Private Limited takes into consideration
the delay in debt servicing and classification of the company's
account as Non-Performing Asset by Union Bank of India.
TIPL's ability to timely service its debt obligations is the key
rating sensitivity.
Tarachand International Private Limited (TIPL) was set-up in 2011
byMr. Vinod Kariya and Mrs. Sunita Kariya. The company is into the
business of steel trading (viz. sheets, plates, channels, angels &
others) and ship breaking. TIPL has its registered office in
Mumbai and carries out the ship breaking activity from the Mumbai
port. During FY14, TIPL successfully purchased 3 vessels
aggregating 11,000 ldt (liquid displacement tonnage) for
demolition at an average rate of US$435/ ldt.
THRIIVE CARS: CRISIL Reaffirms B+ Rating on INR35MM Loan
--------------------------------------------------------
CRISIL has assigned its 'CRISIL A4' rating to the short term bank
facilities of Thriive cars (Thriive) while reaffirming its rating
on the long term bank facilities.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Inventory Funding
Facility 35 CRISIL B+/Stable (Reaffirmed)
Long Term Loan 8.5 CRISIL B+/Stable (Reaffirmed)
Overdraft Facility 9 CRISIL A4 (Reassigned)
Proposed Long Term 8.5 CRISIL B+/Stable (Reaffirmed)
Bank Loan Facility
Proposed Term Loan 6 CRISIL B+/Stable (Reaffirmed)
CRISIL's rating on the long-term bank facilities of Thriive Cars
(Thriive) continue to reflect the firm's average financial risk
profile because of high indebtedness as indicated by a high total
outside liabilities to tangible net worth ratio, and exposure to
intense competition in the automobile dealership business. These
rating weaknesses are partially offset by an established market
position as a dealer for General Motors India Pvt Ltd (GM) in
Tamil Nadu.
Outlook: Stable
CRISIL believes Thriive will continue to benefit over the medium
term from its established market position. The outlook may be
revised to 'Positive' in case of a significant increase in sales
volumes and operating profitability, or a substantial improvement
in capital structure and debt protection metrics. Conversely, the
outlook may be revised to 'Negative' in case of a slowdown in the
automobile industry, adversely impacting revenue and
profitability, or large debt-funded capital expenditure, leading
to weakening of the capital structure.
Thriive, set up in 2006, is an authorised dealer of GM's passenger
vehicles in Tamil Nadu.
TIRUPATI AGENCIES: Ind-Ra Suspends IND D Long-Term Issuer Rating
----------------------------------------------------------------
India Ratings and Research (Ind-Ra) has migrated Tirupati Agencies
Pvt Ltd.'s (TAPL) 'IND D' Long-Term Issuer Rating to the suspended
category. This rating will now appear as 'IND D(suspended)' on the
agency's website. A full list of rating actions is at the end of
the 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 TAPL.
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.
Ind-Ra has also taken the following rating actions on TAPL's bank
loan ratings:
-- Long-Term Issuer Rating: migrated to 'IND D(suspended)' from
'IND D'
-- INR80 million fund-based limits: migrated to Long-term 'IND
D(suspended)' from Long-term 'IND D'
-- INR6 million non-fund-based limits: migrated to Short-term
'IND D(suspended)' from Short-term 'IND D'
YESKAY CONSTRUCTIONS: CRISIL Reaffirms B+ Rating on INR60MM Loan
----------------------------------------------------------------
CRISIL's rating on the long-term bank facility of Yeskay
Constructions (Yeskay) continues to reflect its modest scale of
operations and exposure to intense competition in the fragmented
civil construction industry. These weaknesses are partially offset
by Yeskay's above-average financial risk profile, because of
moderate gearing and debt protection metrics, the extensive
experience of the proprietor in the infrastructure segment, and
its moderate order book.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Cash Credit 60 CRISIL B+/Stable (Reaffirmed)
Outlook: Stable
CRISIL believes Yeskay will benefit over the medium term from the
proprietor's industry experience and its moderate order book. The
outlook may be revised to 'Positive' in case of significant
improvement in the scale of operations and profitability leading
to substantial cash accrual. Conversely, the outlook may be
revised to 'Negative' in case of a steep decline in revenue and
profitability, or deterioration in the working capital management,
or implementation of a large, debt-funded capital expenditure
(capex) programme, weakening the financial risk profile.
Update
Revenue was around INR349 million in 2014-15 (refers to financial
year, April 1 to March 31), a year-on-year increase of around 20
percent on account of steady orders. Operating margin, however,
declined to 7.81 percent in 2014-15 from 11.30 percent in 2013-14,
marked by intense competition in the civil construction industry.
CRISIL believes the business risk profile will remain stable over
the medium term supported by its moderate order book position.
The capital structure is modest with networth of around INR65
million and gearing of 1.60 times as on March 31, 2015. The
capital structure is expected to improve gradually with repayment
of term debt and absence of any debt-funded capex plan. The debt
protection metrics are moderate as indicated by interest coverage
ratio of around 2.43 times and net cash accrual to total debt
ratio of around 11 percent for 2014-15. CRISIL believes the
financial risk profile will remain above average over the medium
term.
The bank limits were fully utilised during the 12 months through
September 2015 owing to working capital intensive operations. The
cash accrual of around INR12 million per annum is expected to be
sufficient to meet repayment obligations over the medium term.
Yeskay, set up in 1988 as a proprietary concern and promoted by
Mr. Sunil Kumar, is a sub-contractor in the infrastructure
segment; it offers civil construction services such as
construction of industrial, residential, and commercial buildings.
=================
I N D O N E S I A
=================
MERPATI NUSANTARA: Restructuring to be Completed This Year
----------------------------------------------------------
Royke Sinaga at ANTARA News reports that the government expects to
complete comprehensive restructuring of cash-strapped carrier
Merpati Nusantara Airlines later this year.
"We want Merpati to continue to exist. This month, all the
obligations towards employees will be completed, and that will be
the basis to continue the privatization of Merpati," the news
agency quotes Deputy State Enterprises Minister for Restructuring
and Business Development, Aloysius K. Ro, as saying.
He said as part of the process of restructuring of Merpati, debt
payments to its employees are being made, ANTARA News relates.
The company has paid what it owed to 900 of its 1,120 workers
through the industrial relations settlement mechanism, he said.
"The amounts owed to 85 percent of Merpati employees have been
settled. Hopefully, the obligations to all employees will be
completed later this month," Ro said.
As the proxy of Merpati stakeholder, the State Enterprises
Ministry is proposing to the Coordinating Minister for Economic
Affairs to endorse the privatization of Merpati, he said, the
report relays.
"We are waiting for a letter of approval from the privatization
committee and will later ask for a seal of approval from the House
of Representatives to continue the privatization of Merpati," Mr.
Ro, as cited by ANTARA News, said.
As part of the privatization program, the government will invite
strategic investors to invest in the carrier, he said.
Some time ago, two investors from China and Europe had expressed
keen interest in developing Merpati by setting up a consortium
with an Indonesian company, he said, adds ANTARA News.
About Merpati Nusantra
Headquartered in Jakarta, Indonesia, PT Merpati Nusantara
Indonesia -- http://www.merpati.co.id/-- is a state-owned
carrier that services predominantly international routes.
* * *
As reported in the Troubled Company Reporter-Asia Pacific on
Feb. 6, 2014, Antara News said that state-owned airline Merpati
Nusantara Airlines has temporarily shut down its operation in the
face of its consolidation period, according to a cabinet minister.
The state-owned airline which is now burdened with debts amounting
to IDR6.7 trillion has been carrying out restructuring since 2005.
It has spent IDR3.6 trillion for its salvaging efforts, according
to Antara News.
====================
N E W Z E A L A N D
====================
MERCER GROUP: To Refinance Bank Debt With Newly Structured Loan
---------------------------------------------------------------
Paul McBeth at BusinessDesk reports that Mercer Group, the
stainless steel fabricator planning to split its businesses in
two, will repay bank debt after restructuring a loan with
shareholder and director Humphrey Rolleston.
Rolleston will provide a NZ$750,000 underwrite on the deferred
consideration from Mercer's sale of its interiors unit, and
provide a NZ$2.5 million 12-month loan at 12 percent interest, the
company said in a statement, BusinessDesk relays. That will let
Mercer repay NZ$1.5 million to Bank of New Zealand and provide it
with working capital of NZ$1.75 million.
BusinessDesk relates that Mercer also restructured an existing
NZ$1 million loan with Rolleston's Gresham Finance unit set to
mature in July, reducing the annual interest rate to 12 percent
from 15 percent.
According to BusinessDesk, the company's directors noted a
"material uncertainty" in signing off on the first-half accounts
over Mercer's ability to continue as a going concern due to its
reliance on BNZ funding. The company had a NZ$2.7 million
overdrawn bank account and NZ$8.5 million of borrowings as at Dec.
31.
BusinessDesk relates that Mercer said it's in "positive
discussions" with the bank, and expects to restructure those
facilities before the end of the financial year on June 30.
Because Rolleston and his Gresham Finance unit are a related party
of Mercer, the company needs an NZX waiver from having to seek
shareholder approval, the report states.
"If the waiver is not granted, the company will be unable to draw
down the funding until the necessary shareholder approval has been
obtained, which will involve a delay of several weeks," the group,
as cited by BusinessDesk, said. "This delay would place additional
stress on the company's working capital position for that period."
Mercer's shares were unchanged at 4 cents, and have dropped 22
percent so far this year, adds BusinessDesk.
Established in 1882, Mercer Group [NZX: MGL] designs, makes and
distributes stainless steel products for the industrial, dairy,
commercial, food processing, healthcare and residential buildings
industries. The Mercer group of companies are subsidiaries of the
New Zealand listed company Broadway Industries Limited (NZE:BWY).
=====================
P H I L I P P I N E S
=====================
RURAL BANK OF BAYAWAN: Placed Under PDIC Receivership
-----------------------------------------------------
The Monetary Board (MB) placed Rural Bank of Bayawan (Negros
Oriental), Inc. under the receivership of the Philippine Deposit
Insurance Corporation (PDIC) by virtue of MB Resolution No. 320
dated February 24, 2016. As Receiver, PDIC took over the bank on
February 26, 2016.
Rural Bank of Bayawan is a single unit rural bank located at 807
H. Bollos Sr. St., 6221 Bayawan City, Negros Oriental. Based on
the Bank Information Sheet filed by the bank with the PDIC as of
December 31, 2015, Rural Bank of Bayawan is owned by Telesforo Y.
Diao, Jr. (26.31%), Leticia Y. Diao (17.66%), the Estate of
Telesforo A. Diao, Sr. (9.57%), Guillermo A. Diao (9.27%),
Raymundo Dela Cruz Siason (9.26%), Ester Grace D. Tiro (6.61%),
Jose V. Torreda, Jr. (4.50%), Edmundo Y. Diao (4.26%), Atilano B.
Cabangal (4.07%), Geraldina D. Gaga-a (3.76%), and other
shareholders (4.73%). The Bank's President is Leticia Y. Diao and
its Chairman is Telesforo Y. Diao, Jr.
Latest available records show that as of December 31, 2015, Rural
Bank of Bayawan had 402 accounts with total deposit liabilities of
PHP10.8 million. Total insured deposits amounted to PHP9.9 million
or 91.8% of total deposits.
PDIC said that during the takeover, all bank records shall be
gathered, verified and validated. The state deposit insurer
assured depositors that all valid deposits shall be paid up to the
maximum deposit insurance coverage of PHP500,000.00.
Depositors with valid deposit accounts with balances of
PHP100,000.00 and below shall be eligible for early payment and
need not file deposit insurance claims, except accounts maintained
by business entities, or when they have outstanding obligations
with Rural Bank of Bayawan or acted as co-makers of these
obligations. Depositors have to ensure that they have complete and
updated addresses with the bank. PDIC will start mailing payments
to these depositors at their addresses recorded in the bank by the
second week of March 2016.
Depositors may update their addresses until March 4, 2016 using
the Mailing Address Update Forms to be distributed by PDIC
representatives at the bank premises.
For depositors that are required to file deposit insurance claims,
the PDIC will start claims settlement operations for these
accounts by the third week of March 2016.
The PDIC also announced that it will conduct a Depositors-
Borrowers' Forum on March 7, 2016. It enjoins all depositors to
attend the Forum to verify with PDIC representatives if they are
eligible for early payment. Those not eligible will be informed of
the requirements and procedures for filing deposit insurance
claims. The time and venue of the Forum will be posted in the
bank's premises and announced in the PDIC website,
www.pdic.gov.ph. Likewise, the schedule of the claims settlement
operations, as well as the requirements and procedures for filing
claims will be announced through notices to be posted in the bank
premises, other public places and the PDIC website.
For more information, depositors may communicate with PDIC Public
Assistance personnel stationed at the bank premises. They may also
call the PDIC Toll Free Hotline at 1-800-1-888-PDIC (7342), the
PDIC Public Assistance Hotlines at (02) 841-4630 to (02) 841-4631,
or send their e-mail to pad@pdic.gov.ph.
=================
S I N G A P O R E
=================
FIDJI LUXEMBOURG: Moody's Withdraws B1 Corporate Family Rating
--------------------------------------------------------------
Moody's Investors Service has withdrawn all ratings on Fidji
Luxembourg (BC4) S.a r.l., including its B1 corporate family
rating and B1 first lien term loan rating and the B1 rating on the
first lien revolving credit facility of its wholly owned
subsidiary FCI Asia Pte Ltd's (together FCI).
Moody's has withdrawn the ratings following the acquisition of FCI
by Amphenol Corporation (Baa1 stable) and the repayment of all
outstanding loans.
RATINGS RATIONALE
On Jan. 8, 2016, Amphenol announced that it completed the
previously announced acquisition of FCI for an aggregate purchase
price of approximately $1,179 million, net of cash acquired. In
connection with the acquisition, all existing rated debt was
repaid in full and therefore all ratings have been withdrawn.
FCI, based in Singapore, is a specialized manufacturer of
electronic connectors for the telecom, data, commercial, and
consumer markets. FCI has a broad customer base in different end
markets, operating in over 30 countries. FCI reported around $600
million of revenues for the year ended December 2014.
=============
V I E T N A M
=============
SAIGON THUONG: Moody's Confirms B3 Deposit and Issuer Ratings
-------------------------------------------------------------
Moody's Investors Service has confirmed Saigon Thuong Tin
Commercial Joint-Stock Bank's (Sacombank) deposit and issuer
ratings of B3.
Moody's has also confirmed the bank's standalone baseline credit
assessment (BCA) and adjusted BCA of caa1, as well as its
counterparty risk assessment of B2(cr).
The outlook on all ratings is stable.
This action concludes the review with direction uncertain
initiated on Oct. 9, 2015, when Sacombank announced its merger
with Phuong Nam Commercial Joint Stock Bank (Southern Bank; not
rated).
RATINGS RATIONALE
The confirmation of Sacombank's ratings reflects Moody's review of
the bank's consolidated financial report for 2015, which includes
the operations of Southern Bank, and discussions with the
management of Sacombank.
The consolidation of Southern Bank results in an increase in
Sacombank's asset base by 37%. The post-merger Sacombank ranks as
the largest privately-owned bank in Vietnam by assets, and fifth
largest if government banks are considered.
In Moody's opinion, while the impact of the merger is negative for
Sacombank's key financial fundamentals, the risks associated with
the addition of Southern Bank are reflected in Sacombank's rating
level of B3 and BCA of caa1.
Moody's notes that the transaction results in a higher level of
problem assets for the enlarged Sacombank. Problem assets -- such
as non-performing loans, special mention loans, and the bonds of
Vietnam Asset Management Company (VAMC) -- increased to 8.4% of
gross loans at end-2015, from 7.4% before the merger in September
2015.
At the same time, in Moody's view, Sacombank's level of problem
assets is largely in line with that of other rated Vietnamese
banks.
The merger also contributes to higher non-interest-generating
assets, such as interest income and fees receivables, and
repossessed collateral. Repossessed collateral, which is mostly
real estate, increased to around 38% of shareholders' equity at
end-2015 from 7% at end-2014.
Overall, non-interest yielding assets comprised 26% of assets at
end-2015, up from 15% at end-September 2015. In Moody's view,
these assets contribute to a lower net interest margin for
Sacombank.
In addition, the capital buffer of the merged bank has weakened
moderately. Its tangible common equity-to-adjusted risk weighted
assets (RWA) fell to 8.2% at end-2015 from 9.4% at end-2014. This
ratio includes Moody's standard RWA adjustment, where Vietnam
government securities are risk weighted at 100%. Without these
adjustments, the Tier 1 ratio fell to 9.4% from 10.2%.
Sacombank's liquidity position has also weakened, with cash, money
market, interbank and available-for-sale and trading securities
making up 14% of total assets at end-2015, compared to 22% at end-
September 2015.
The inclusion of additional problem assets in the fourth quarter
of 2015 resulted in a net loss of VND520 billion in that quarter,
due to new loan-loss provisions of VND1.1 trillion.
For the full year of 2015, credit costs consumed 60% of pre-
provision income. As a result, the return on average assets
decreased to 0.4% in 2015 from 1.2% in 2014.
Moody's expects that Sacombank's profitability will remain weak in
2016 due to the need to create additional provisions against
problem assets.
Moody's understands that following the merger, the State Bank of
Vietnam (SBV) -- the banking regulator -- received voting rights
on 51% of the voting shares of Sacombank from private
shareholders.
According to Sacombank's management, the devolution of voting
rights to the SBV was driven by the regulator's desire to ensure a
smooth merger process and a timely resolution of problem assets.
To capture the uncertainty over corporate control and governance
arising from the voting structure, the BCA of caa1 now
incorporates a negative adjustment for "corporate behavior".
WHAT COULD CHANGE THE RATINGS UP/DOWN
A ratings downgrade could occur if Moody's determines that
Sacombank's financial profile has materially weakened. Downgrade
drivers include a significant erosion in asset quality, a
substantial decrease in the tangible common equity to risk
weighted assets ratio, weaker profitability, and/or pressure on
its funding and liquidity profiles.
Improvements in Sacombank's asset quality and capital adequacy
would be positive for the ratings.
The principal methodology used in these ratings was Banks
published in January 2016.
The ratings affected by today's action are:
Saigon Thuong Tin Commercial Joint-Stock Bank (Sacombank)
-- The local currency and foreign currency long-term deposit
ratings of B3; confirmed
-- The local currency and foreign currency long-term issuer
ratings of B3; confirmed
-- The BCA and Adjusted BCA of caa1; confirmed
-- The long-term counterparty risk assessment of B2(cr);
confirmed
Headquartered in Ho Chi Mihn City, Vietnam, Sacombank had total
assets of VND292 billion (around USD13 billion) at end-2015.
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* Steel Producers to Report Lower Earnings in 2016, Moody's Says
----------------------------------------------------------------
Moody's Investors Service says that steel producers in Asia will
see their overall earnings in 2016 fall to levels even lower than
the weak results reported in 2015 because production volumes and
spreads will contract further, against the backdrop of oversupply
and the resulting low prices.
"Debt leverage for rated Asian steel producers in 2016 will remain
high in 2016, after increasing significantly in 2015," says Jiming
Zou, a Moody's Vice President and Senior Analyst. "Nevertheless,
the levels in 2016 will likely fall year-over-year due to
corporate austerity measures."
Zou points out that such expectations for the steel sector led to
Moody's taking negative rating actions on most steel companies in
recent weeks.
"As demand for steel in China declines further -- against the
backdrop of slower Chinese economic growth -- the country's steel
producers will continue to export their giant stockpiles of steel,
pressuring prices in Asia," adds Zou. "Anti-dumping measures and
safeguard duties will slow Chinese export growth, but overall
volumes will remain high."
Zou explains that China accounts for half of all steel production
globally, and three-quarters of such production in Asia. It is
also a giant steel consumer. Consequently, Chinese steel supply
and demand dynamics show significant effects beyond the country's
borders.
Moody's analysis is contained in its just-released report titled
"Steel Producers - Asia: Supply Glut and Low Prices Will Reduce
Earnings and Keep Leverage High in 2016," and is authored by Zou.
Moody's report says that in 2015, China's apparent steel
consumption declined 5% year on year, while net exports grew
25.5%. Moody's expects that steel demand in China will fall
another 5% in 2016 and exports will rise by a single-digit
percentage.
Moody's says that large steel producers can improve their business
scale and market share by acquiring small or inefficient steel
producers that become unviable due to the challenging market
conditions.
However, in terms of the Chinese market in particular, despite the
government's efforts to consolidate the domestic steel industry,
there is significant uncertainty over the pace of the capacity
reduction and rebalancing of supply and demand in the country.
On specific steel markets, Moody's report says that Chinese
producers will underperform those in other parts of Asia, because
of the massive supply situation in China.
As for Korean and Japanese steel companies, they are better
positioned to weather adverse market conditions because of their
focus on premium products, although earnings will stay below their
historical levels.
For major Indian steel mills, the ramp-up of new steel-production
capacity, resumption of captive iron ore production and the
government's introduction of minimum import prices will help the
sector mitigate earnings pressure during 2016.
*********
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
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without prior written permission of the publishers.
Information contained herein is obtained from sources believed
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TCR-AP subscription rate is US$775 for 6 months delivered via e-
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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 ***