/raid1/www/Hosts/bankrupt/TCRAP

/raid1/www/Hosts/bankrupt/TCRAP_Public/160406.mbx T R O U B L E D C O M P A N Y R E P O R T E R A S I A P A C I F I C Wednesday, April 6, 2016, Vol. 19, No. 67 Headlines A U S T R A L I A A M E PRODUCTS: First Creditors' Meeting Set For April 13 CANBERRA PACIFIC: Placed in Administration INLAND NSW: Placed in Administration LED4LIFE PTY: Placed in Administration PEAKE PTY: First Creditors' Meeting Set Today SIDOMA PTY: In Liquidation; First Meeting Set For April 13 VIRGIN AUSTRALIA: Moody's Puts B2 CFR on Review for Downgrade C H I N A TONGJI HEALTHCARE: Delays Filing of 2015 Form 10-K I N D I A AAROHI CONSTRUCTIONS: Ind-Ra Assigns 'IND B+' LT Issuer Rating AGNIBINA FOODS: CRISIL Suspends B Rating on INR82MM Term Loan ANG LIFE: CRISIL Raises Rating on INR60MM Term Loan to B- ARANI POWER: ICRA Suspends D Rating on INR36.92cr Loan ARCHIT PLYWOOD: ICRA Reaffirms B Rating on INR4.0cr Cash Loan BHAGWATI COTTON: CRISIL Reaffirms 'B' Rating on INR295.7MM Loan BRAHMAPUTRA INFRA: CRISIL Suspends B- Rating on INR255MM Loan CAR PLANET: CRISIL Assigns 'B' Rating to INR46MM Term Loan CARRIER WHEELS: Ind-Ra Assigns 'IND B' Long-Term Issuer Rating CHAMUNDA ELECTRICAL: ICRA Assigns B+ Rating to INR1.0cr Loan CMC COMMUTATORS: ICRA Revises Rating on INR3.35cr Loan to B D AND M CABLES: Ind-Ra Assigns 'IND B+' Long-Term Issuer Rating D.V. EXPORTS: ICRA Suspends B+ Rating on INR10cr Cash Loan DEVGAN SOLVEX: CRISIL Suspends B+ Rating on INR59MM Cash Loan DIVAKAR PV: Weak Financial Strength Cues ICRA SP 3D Grading EMAAR ALLOYS: CRISIL Lowers Rating on INR95.4MM Cash Loan to D ESSEL MARKETING: ICRA Lowers Rating on INR10.20cr Loan to B FOURTH DIMENSION: Weak Financial Strength Cues ICRA SP 2D Grading GAURAV RICE: CRISIL Suspends B Rating on INR147.1MM Term Loan HASAN MARKETING: Weak Financial Strength Cues ICRA SP 3D Grading HIVE INFRA: Weak Financial Strength Cues ICRA SP4D Grading INDO VACUUM: ICRA Revises Rating on INR2.20cr Cash Loan to B JAL EXPORTS: ICRA Reaffirms B+/A4 Rating on INR12cr LT Loan JSW STEEL: Fitch Cuts Issuer Default Rating to 'BB' K.C. TIMBER: CRISIL Assigns B Rating to INR80MM Credit Limit KAMAKHYA TRANSFORMERS: Ind-Ra Assigns 'IND BB' LT Issuer Rating LB COTTON: ICRA Lowers Rating on INR5cr LT Loan to D LINERS INDIA: ICRA Assigns 'C' Rating to INR12.50cr Loan MAHADEV INDUSTRIES: ICRA Reaffirms B Rating on INR20.80cr Loan MAHAKALESHWAR INFRATECH: Ind-Ra Affirms IND BB+ LT Issuer Rating MAN COTT: Ind-Ra Assigns 'IND BB' Long-Term Issuer Rating MANGAL SPONGE: ICRA Lowers Rating on INR25cr Cash Loan to B+ NEW FRONT: ICRA Suspends B Rating on INR20cr LT Loan NOVEL SUGAR: Ind-Ra Affirms 'IND BB' Long-Term Issuer Rating OMKAR INFRACON: Ind-Ra Assigns 'IND BB-' Long-Term Issuer Rating ORCHID CURE: CRISIL Reaffirms B+ Rating on INR105MM Term Loan PAWAN KUMAR: CRISIL Assigns B+ Rating to INR80MM Cash Loan RAHIS COLD: CRISIL Assigns 'B' Rating to INR75MM Cash Loan RATIONAL HANDLOOM: Ind-Ra Assigns IND BB Long-Term Issuer Rating RHIZOME DISTILLERIES: CRISIL Ups Rating on INR110MM Loan to B+ S. NANDA: ICRA Assigns B+ Rating to INR12cr LT Loan SAMBASADASHIV COLD: ICRA Suspends D Rating on INR7cr Loan SANGO AUTO: CRISIL Raises Rating on INR15MM Term Loan to B+ SHARMA CONSTRUCTION: CRISIL Assigns B+ Rating to INR50MM Loan SHIVAM COTTEX: ICRA Reaffirms B+ Rating on INR6cr Cash Loan SHREE RENUKA: Ind-Ra Downgrades Long-Term Issuer Rating to IND D SHRI BALAJI: ICRA Reaffirms B+ Rating on INR8cr Cash Loan SHRIMAN ENTERPRISES: ICRA Assigns 'B' Rating to INR36cr Loan SPJ SOLAR: Weak financial strength Cues ICRA SP 4D Grading SREE NARAYANA: CRISIL Suspends B- Rating on INR80MM Term Loan SRI ADHITYA: ICRA Assigns B- Rating to INR5.0cr LT Loan SRI KRISHNA: ICRA Reaffirms 'B' Rating on INR10.69cr Loan SRI LAKSHMI: ICRA Suspends B+ Rating on INR17cr Loan SRI SAI: ICRA Assigns 'B' Rating to INR5.60cr Unallocated Loan SRINITHI ENTERPRISES: ICRA Upgrades Rating on INR7cr Loan to BB- STEEL AUTHORITY: Fitch Cuts LT FC Issuer Default Rating to 'BB' SUSHIL ANSAL: CRISIL Lowers Rating on INR248MM Term Loan to D TAGORE SHIKSHAN: CRISIL Assigns B+ Rating to INR99MM LT Loan TAPAL STEEL: CRISIL Suspends 'D' Rating on INR100MM Cash Loan TARINI MOTORS: ICRA Reaffirms B+ Rating on INR3.25cr Cash Loan TATA STEEL: Fitch Cuts LT FC Issuer Default Rating to 'BB' THE HIMANIS: CRISIL Assigns B+ Rating to INR50MM Term Loan UNITED NANOTECHNOLOGIES: ICRA Assigns B- Rating to INR3.02cr Loan VINIRRMAA PROJECTS: Ind-Ra Affirms IND B Long-Term Issuer Rating VIVA VITA: CRISIL Suspends D Rating on INR50MM LT Loan VRIDHI IRON: Ind-Ra Assigns 'IND B+' Long-Term Issuer Rating YASH BREEDING: ICRA Suspends 'B' Rating on INR10cr Bank Loan I N D O N E S I A ALAM SUTERA: Moody's Lowers CFR to B2; Outlook Stable PERTAMINA ENERGI: Liquidation Set to be Complete in Mid-2016 J A P A N ASAHI LIFE: Fitch Affirms 'BB+' Insurer Fin'l Strength Rating N E W Z E A L A N D STONEWOOD HOMES: New Owner Seeks Legal Advice Over Contracts S I N G A P O R E S TRAVEL: Tour Operator Shuts Down Unexpectedly V I E T N A M VIETNAM BANK: Fitch Affirms 'B+' Long-Term Issuer Default Ratings * VIETNAM: 2,900 Firms Close Down in Q1 - - - - - ================= A U S T R A L I A ================= A M E PRODUCTS: First Creditors' Meeting Set For April 13 --------------------------------------------------------- Robert Hutson and Jarrod Villani of KordaMentha were appointed as administrators of A M E Products Pty Ltd on April 1, 2016. A first meeting of the creditors of the Company will be held at KordaMentha, Level 14, 12 Creek Street, in Brisbane, QLD, on April 13, 2016, at 10:00 a.m. CANBERRA PACIFIC: Placed in Administration ------------------------------------------ Antony Resnick and Riad Tayeh of de Vries Tayeh were appointed as administrators of Canberra Pacific Management Pty Ltd on March 31, 2016. INLAND NSW: Placed in Administration ------------------------------------ Cliff Sanderson at Dissolve.com.au reports that Inland NSW Regional Tourism Organisation Incorporated has been placed into administration. Andrew John Spring and Bradd William Morelli from Jirsch Sutherland were appointed administrators of the company on March 31, 2016, the report says. According to Dissolve.com.au, the appointment resulted from the company not receiving sufficient grant funding. Inland NSW Regional Tourism Organisation Incorporated is responsible for promoting tourism throughout the majority of the western and northern New South Wales. LED4LIFE PTY: Placed in Administration -------------------------------------- Robert Moodie and Will Griffiths of Rodgers Reidy were appointed as administrators of Led4Life Pty Ltd on April 4, 2016. PEAKE PTY: First Creditors' Meeting Set Today --------------------------------------------- Timothy Clifton and Daniel Lopresti of Clifton Hall were appointed as Joint and Several Administrators of Peake Pty Ltd, trading as Tanami Downs Station, on March 23, 2016. A meeting of creditors will be held at 10:30 a.m. today, April 6, 2016, at Clifton Hall, Level 3, 431 King William Street, in Adelaide. SIDOMA PTY: In Liquidation; First Meeting Set For April 13 ---------------------------------------------------------- Timothy Clifton and Mark Hall of Clifton Hall were appointed as Joint and Several Liquidators of Sidoma Pty Ltd, trading as All Bake Services, on March 30, 2016. A meeting of creditors will be held at 2:30 p.m. on April 13, 2016, at Clifton Hall, Level 3, 431 King William Street, in Adelaide. VIRGIN AUSTRALIA: Moody's Puts B2 CFR on Review for Downgrade ------------------------------------------------------------- Moody's Investors Service has placed the B2 corporate family rating and the B3 senior unsecured rating of Virgin Australia Holdings Limited on review for downgrade. Moody's has also placed on review for downgrade, the ratings assigned to Virgin Australia 2013-1A Trust, Virgin Australia 2013-1B Trust, Virgin Australia 2013-1C Trust, and Virgin Australia 2013-1D Trust. RATINGS RATIONALE "The review for downgrade reflects Moody's view of the uncertainty which has emerged over the outcome of Virgin Australia's capital structure review and the level of shareholder support given Air New Zealand's announcement that it is exploring options with respect to its shareholding in Virgin Australia, including a possible sale of all or part of its about 26% stake," says Ian Chitterer, a Moody's Vice President and Senior Analyst. "The review also reflects the slower-than-expected momentum now evident in the deleveraging of the business and the deterioration in its liquidity profile, as reported for July-December 2015," adds Chitterer. Virgin Australia was initially rated B2 in November 2014 and has not reduced its debt/EBITDA as quickly as Moody's had expected. Adjusted debt/EBITDA for the 12 months ended Dec. 31, 2015, was 7.2x, a level which exceeds Moody's tolerance of 6.5x for its B2 corporate family rating. Virgin Australia's unrestricted cash balance fell by 24% to AUD544 million at Dec. 31, 2015, compared to AUD719 million at June 30, 2015, thereby weakening the company's liquidity and credit profiles. Virgin Australia's strong shareholder base and its willingness to offer financial support in challenging times have historically provided additional support to the airline's ratings and increased Moody's rating tolerance for its current weak credit metrics. Moody's believes that Air New Zealand's announcement creates uncertainty around the future ownership structure, and this may impact shareholder support. During the review, Moody's will look for more clarity around the future of the shareholder base and support. The EENs are issued by separate Australian law trusts (EEN Trusts). The sole beneficiary of each EEN Trust is an orphan special purpose, Australian bankruptcy-remote vehicle. The transaction structure is based on that of the Enhanced Equipment Trust Certificates (EETCs) that have been issued by US and non-US airlines, with one key exception. In the case of the Virgin Australia transaction, the EEN Trusts issue debt instruments, the EENs, rather than the certificates issued in a traditional EETC, which represent fractional undivided interests in those trusts. The EENs originally financed 24 of the company's aircraft, then owned and operated by wholly-owned indirect subsidiaries of Virgin Australia. The aircraft were delivered new between August 2003 and August 2011. The notes on the two Boeing B737-700 aircraft in the transaction matured in 2015, leaving 22 aircraft in the collateral. Moody's assigns ratings to EETCs and the EENs by adding or subtracting notches to or from an airline's corporate family rating, based on its opinions of the importance of the aircraft collateral to the airline's network, whether there is a liquidity facility, its estimates of the size of the equity cushion, and each Classes' position in the waterfall. WHAT COULD CHANGE THE RATINGS - VIRGIN AUSTRALIA Should the outcome of the capital structure review bring Virgin Australia's financial metrics into line with expectations for a B2 rating, Moody's would affirm the current rating. If not, the airline will be downgraded to B3. In order for the rating agency to consider an upgrade to B1, Moody's would need to see strong shareholder support, operational initiatives to enhance cash flow and profitability, and debt reduction to a level well inside the thresholds for a B1 rating. The rating agency views this scenario as unlikely. WHAT COULD CHANGE THE RATINGS - EEN AND EETC Moody's will assess the positioning of the EEN ratings relative to the post-review corporate family rating of the airline. METHODOLOGIES The principal methodology used in rating Virgin Australia Holdings Limited was Global Passenger Airlines published in May 2012. The principal methodology used in rating Virgin Australia 2013-1A Trust, Virgin Australia 2013-1B Trust, Virgin Australia 2013-1C Trust, and Virgin Australia 2013-1D Trust was Enhanced Equipment Trust And Equipment Trust Certificates published in December 2015. Virgin Australia Holdings Limited headquartered in Brisbane, is Australia's second largest airline following its launch in 2000 and listing on the Australian Securities Exchange in 2003. As of June 2015 it generated revenues of AUD4.7 billion and around 23.5 million revenue passengers including Tigerair Australia (Tigerair). VAH operates 157 aircraft, including the fleet of Tigerair, its low cost carrier. ========= C H I N A ========= TONGJI HEALTHCARE: Delays Filing of 2015 Form 10-K -------------------------------------------------- Tongji Heahtcare Group, Inc. filed with the U.S. Securities and Exchange Commission a Notification of Late Filing on Form 12b-25 with respect to its annual report on Form 10-K for the year ended Dec. 31, 2015. According to the Company, it has encountered a delay in assembling the information, in particular its financial statements for the year ended Dec. 31, 2015, required to be included in its Annual Report. The Company expects to file its Dec. 31, 2015, Form 10-K Annual Report with the SEC within 15 calendar days of the prescribed due date. About Tongji Healthcare Based in Nanning, Guangxi, the People's Republic of China, Tongji Healthcare Group, Inc., a Nevada corporation, operates Nanning Tongji Hospital, a general hospital with 105 licensed beds. Tongji Healthcare reported a net loss of $462,000 on $2.52 million of total operating revenues for the year ended Dec. 31, 2014, compared with a net loss of $730,000 on $2.37 million of total operating revenues for the year ended Dec. 31, 2013. As of Sept. 30, 2015, the Company had $16.8 million in total assets, $19.4 million in total liabilities and a $2.60 million total stockholders' deficit. ========= I N D I A ========= AAROHI CONSTRUCTIONS: Ind-Ra Assigns 'IND B+' LT Issuer Rating -------------------------------------------------------------- India Ratings and Research (Ind-Ra) has assigned Aarohi Constructions Private Limited (ACPL) a Long-Term Issuer Rating of 'IND B+'. The Outlook is Stable. The agency has also assigned ACPL's INR100 million fund-based working capital limits an 'IND B+'/Stable rating. KEY RATING DRIVERS The ratings are constrained by ACPL's small scale of operations, as reflected in its revenues of INR9m in FY15 (FY14: INR8m) and moderate credit profile, with interest coverage (operating EBITDA/gross interest expense) of 2.9x (1.7x) and net financial leverage (total adjusted net debt/operating EBITDA) of 19x (6.1x). ACPL is developing two storeys over Aarohi Super Bazar in Lucknow, Uttar Pradesh, and this project is scheduled to be completed by May 2017, thereby increasing the risk of time or cost overruns, which could impact the project's profitability and debt servicing ability. The ratings draw comfort from ACPL's past projects, which have been completed, and its promoters' experience of over two decades in the construction of residential and commercial buildings. RATING SENSITIVITIES Positive: Timely completion of the Aarohi Super Bazar project in line with its cost outlays, will be positive for the ratings. Negative: Any time or cost overruns in the Aarohi Super Bazar project will be negative for the ratings. COMPANY PROFILE Established in 1986, ACPL is a developer of commercial and residential complexes across Lucknow. AGNIBINA FOODS: CRISIL Suspends B Rating on INR82MM Term Loan ------------------------------------------------------------- RISIL has suspended its rating on the bank facilities of Agnibina Foods Private Limited (AFPL). Amount Facilities (INR Mln) Ratings ---------- --------- ------- Cash Credit 40 CRISIL B/Stable Proposed Long Term Bank Loan Facility 3 CRISIL B/Stable Term Loan 82 CRISIL B/Stable The suspension of rating is on account of non-cooperation by AFPL with CRISIL's efforts to undertake a review of the ratings outstanding. Despite repeated requests by CRISIL, AFPL is yet to provide adequate information to enable CRISIL to assess AFPL's ability to service its debt. The suspension reflects CRISIL's inability to maintain a valid rating in the absence of adequate information. CRISIL considers information availability risk as a key factor in its rating process as outlined in its criteria 'Information Availability - a key risk factor in credit ratings' Incorporated in 2012, AFPL is engaged in milling and processing of paddy into rice, rice bran, broken rice, and husk. The promoter directors Mr. Biswajit Hazra, Mr. Dilip Kumar Shaw, Mr. Gopinath Dawn, and Partha Sarathi Hati manage the day-to-day operations. The company started commercial operations in April 2014. ANG LIFE: CRISIL Raises Rating on INR60MM Term Loan to B- --------------------------------------------------------- CRISIL has upgraded its ratings on the bank loan facilities of ANG Life Sciences India Private Limited (ANG) to 'CRISIL B- /Stable/CRISIL A4' from 'CRISIL D/CRISIL D '. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Cash Credit 30 CRISIL B-/Stable (Upgraded from 'CRISIL D') Letter of Credit 37.5 CRISIL A4 (Upgraded from 'CRISIL D') Proposed Long Term 52.5 CRISIL B-/Stable (Upgraded Bank Loan Facility from 'CRISIL D') Term Loan 60 CRISIL B-/Stable (Upgraded from 'CRISIL D') The upgrade reflects timely servicing of debt by ANG over the four months through February 2015. Furthermore, CRISIL's believes that the company will continue to service its debt in a timely manner over the medium term with its cash accrual expected to be sufficient to meet debt repayment obligations. The ratings also reflect the company's weak financial profile because of high gearing, and working capital-intensive operations. These rating weaknesses are partially offset by its promoters' extensive experience in the pharmaceutical Industry. Outlook: Stable CRISIL believes ANG will continue to benefit over the medium term from its promoters' industry experience. The outlook may be revised to 'Positive' in case of substantial growth in revenue or operating profitability, resulting in a better financial risk profile. Conversely, the outlook may be revised to 'Negative' in case of a decline in revenue or profitability, sizeable, debt- funded capital expenditure, or a stretched working capital cycle, adversely impacting liquidity. Incorporated in 2006, ANG manufactures dry powder injectables at its plant at Baddi, Himachal Pradesh. Its operations are currently being managed by Mr. Rajesh Gupta. ARANI POWER: ICRA Suspends D Rating on INR36.92cr Loan ------------------------------------------------------ ICRA has suspended the long term rating of [ICRA]D assigned to INR36.92 crore fund based limits and INR2.00 crore non-fund based limits of Arani Power Systems Ltd (APSL). ICRA has also suspended the short term rating of [ICRA]D assigned to the INR3.80 crore non-fund based limits of APSL. 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. Incorporated in 2006, APSL is a Hyderabad based original equipment manufacturer of 4-45 MW steam turbines and supplies systems, components and services in the field of steam based, medium capacity power generation equipments. The range of steam turbines is up to 45 Megawatts with inlet steam parameters ranging from 65ata/500 deg C up to 100ata/525 deg C. The systems cover widely TG (Turbo Generators) Island that includes steam turbines, alternators, gearboxes and heat exchangers with the state-of-the-art controls. The company offers turbo-generators packages from Co-generation, IPPs, CPPs, CCP's in sugar, steel, cement, paper, biomass and other core sectors including the utility segment. The company also provides value-added services that include erection, commissioning, supply of replaceable components, troubleshooting, engineering improvements and repairs. ARCHIT PLYWOOD: ICRA Reaffirms B Rating on INR4.0cr Cash Loan ------------------------------------------------------------- ICRA has reaffirmed its long term rating of [ICRA]B on the INR4.00 crore cash credit facilities and INR0.75 crore term loan facility of Archit Plywood Private Limited (APPL) and the short- term rating of [ICRA]A4 to the INR4.25 crore non-fund based limits of APPL. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Cash Credit Facilities (LT Scale) 4.00 [ICRA]B; reaffirmed Term Loan Facilities (LT Scale) 0.75 [ICRA]B; reaffirmed Letter of Credit (ST Scale) 4.00 [ICRA]A4; reaffirmed Unallocated (LT/ST Scale) 0.25 [ICRA]B/[ICRA]A4; reaffirmed ICRA's ratings continues to take into account the highly competitive and fragmented nature of the industry it operates in, with the presence of numerous players in both the organized and the unorganized sectors. The ratings also factor in the high inventory levels maintained for the primary raw material, timber, which is procured in bulk during the timber harvest season from different geographies along with the stretched receivables and payables levels during FY15. Further, the company is exposed to the risk of adverse foreign exchange movements due to the lack of a hedging mechanism. However, the ratings derive comfort from the presence of the company's manufacturing facility in the wood and wood product manufacturing hub- Gandhidham, Gujarat, which results in benefits such as proximity to customers, access to raw materials etc and the strong growth in the top line during FY15 and the net profits recorded during the year after the series of losses in the past. The ability of the company to further increase its scale of operations with improvement in profitability and better management of the working capital cycle will be the key rating sensitivities. APPL commenced operations from October 2011 and is engaged in the trading of timber and manufacturing of plywood, veneer, block board and flush doors. It sells the products under the registered brand name "Archit". The company's head office is located in New Delhi whereas the manufacturing facility is located in Gandhidham, Gujarat. Recent Results In 2014-15, APPL reported an operating income of INR16.35 crore and a net profit of INR0.10 crore as against an operating income of INR11.80 crore and a net loss of INR0.35 crore in the previous year. APPL on provisional basis has booked revenue of INR15.00 crore during FY16 (11m) period. BHAGWATI COTTON: CRISIL Reaffirms 'B' Rating on INR295.7MM Loan --------------------------------------------------------------- CRISIL's ratings on the bank facilities of Bhagwati Cotton and Spinning Mills Private Limited (BCSM) continue to reflect the company's below-average financial risk profile marked by high gearing and average debt-protection metrics, and exposure of its operating margin to volatility in raw material prices. These rating weaknesses are partially offset by the extensive experience of its promoters in the yarn industry and their funding support. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Bank Guarantee 2.5 CRISIL A4 (Reaffirmed) Cash Credit 100 CRISIL B/Stable (Reaffirmed) Letter of Credit 70 CRISIL A4 (Reaffirmed) Proposed Long Term Bank Loan Facility 31.8 CRISIL B/Stable (Reaffirmed) Term Loan 295.7 CRISIL B/Stable (Reaffirmed) Outlook: Stable CRISIL believes BCSM will continue to benefit over the medium term from its promoters' extensive industry experience. The outlook may be revised to 'Positive' if the financial risk profile improves significantly, most likely due to substantial cash accrual or equity infusion along with efficient working capital management. Conversely, the outlook may be revised to 'Negative' if the financial risk profile, particularly liquidity, weakens because of considerably low cash accrual or large working capital requirement. Update Operating revenue grew significantly to INR1006.1 million in 2014-15 (refers to financial year, April 1 to March 31) from INR800.6 million in 2013-14 due to the positive domestic market scenario. BCSM has achieved turnover of INR900 million for the 11 months through February 2016 and CRISIL believes that revenue will hover around INR1000-1010 million in 2015-16 owing to sluggish demand and declining trends of polyester prices. Operating margin improved to 7.7 percent in 2014-15 from 5.3 percent in 2013-14 as a low crude oil price led to low fuel and power costs. CRISIL believes that operating margin of the company will hover in the range of 7 to 8 percent over the medium term. Financial risk profile is characterized by moderate net worth and high gearing of INR140.0 million and 2.29 times as on March 31, 2015. The networth is expected to remain at a similar level over the medium term owing to modest accretion to reserves. Gearing is expected to improve to 1.90 times over this period owing to absence of significant debt-funded capex. Debt protection metrics were average with net cash accrual to total debt (NCATD) and interest coverage ratios (ICR) at 0.10 time and 1.7 times, respectively, in 2014-15 and CRISIL believe that debt-protection metrics will remain average with NCATD and ICR expected at 0.10- 0.13 and 1.80-2.00 times respectively over the medium term. BCSM's liquidity profile is expected to remain weak as the company is expected to generate low net cash accruals of INR36.90 million against repayment obligation of 49.10 million in 2015-16. Liquidity is however supported by promoters who have supported the liquidity through unsecured loans at INR18.8 million as on March 31 2015 and moderate utilisation of bank limit at around 85 percent over the 12 months through Jan 2016. BCSM was incorporated in 2000, promoted by the Ludhiana-based Dhir family. The company manufactures synthetic yarn such as polyester and acrylic yarn. At present, It has a production capacity of 16,000 spindles. BRAHMAPUTRA INFRA: CRISIL Suspends B- Rating on INR255MM Loan ------------------------------------------------------------- CRISIL has suspended its rating on the bank facility of Brahmaputra Infra Power Private Limited (BIPPL). Amount Facilities (INR Mln) Ratings ---------- --------- ------- Term Loan 255 CRISIL B-/Stable The suspension of rating is on account of non-cooperation by BIPPL with CRISIL's efforts to undertake a review of the ratings outstanding. Despite repeated requests by CRISIL, BIPPL is yet to provide adequate information to enable CRISIL to assess BIPPL's ability to service its debt. The suspension reflects CRISIL's inability to maintain a valid rating in the absence of adequate information. CRISIL considers information availability risk as a key factor in its rating process as outlined in its criteria 'Information Availability - a key risk factor in credit ratings' BIPPL, incorporated in February 2009, is a wholly owned subsidiary of Neccon. BIPPL is a special purpose vehicle created to execute a 4.7-megawatt run-of-the river hydropower project on Bordikorai river, a tranche on the northern bed of the Brahmaputra river, in Sonitpur (Assam). CAR PLANET: CRISIL Assigns 'B' Rating to INR46MM Term Loan ---------------------------------------------------------- CRISIL has assigned its 'CRISIL B/Stable' rating to the long-term bank facilities of Car Planet Enterprises Pvt Ltd (CEPL). Amount Facilities (INR Mln) Ratings ---------- --------- ------- Term Loan 46 CRISIL B/Stable Cash Credit 19 CRISIL B/Stable Inventory Funding Facility 30 CRISIL B/Stable The rating reflects CEPL's exposure intense competition in the automobile dealership business and a below-average financial risk profile because of a modest networth, high total outside liabilities to tangible networth ratio, and weak interest coverage ratio. These rating strengths are partially offset by the extensive experience of promoters in the automobile dealership business. Outlook: Stable CRISIL believes CEPL will benefit over the medium term from the promoters' extensive industry experience. The outlook may be revised to 'Positive' if higher-than-expected revenue or cash accrual, or substantial capital infusion by promoters leads to improvement in the financial risk profile. Conversely, the outlook may be revised to 'Negative' in case of lower-than- expected accrual or weaker-than-expected working capital management, or any larger-than-expected, debt-funded capital expenditure, leading to deterioration in the financial risk profile, particularly liquidity. Incorporated in 2009, CEPL, promoted by Mr. Amit Agarwal, is an authorised dealer for various companies such as Fiat Group Automobiles, Mitsubishi Motors, and Mahindra Earth Master; it also runs Mahindra First Choice service centre. Mr. Agarwal looks after the company's operations. CARRIER WHEELS: Ind-Ra Assigns 'IND B' Long-Term Issuer Rating -------------------------------------------------------------- India Ratings and Research (Ind-Ra) has assigned Carrier Wheels Private Limited (CWPL) a Long-Term Issuer Rating of 'IND B'. The Outlook is Stable. A full list of rating actions is at the end of this commentary. KEY RATING DRIVERS The ratings reflect CWPL's small scale of operations and moderate-to-weak credit metrics. Its FY15 revenue was INR204.80 million (FY14: INR79.54 million), net financial leverage (total adjusted net debt/operating EBITDA) was 14.60x (negative 139.4x) and gross interest coverage (operating EBITDA/gross interest expense) was 4.47x (negative 0.5x). However, the ratings are supported by CWPL's comfortable liquidity position, as evident from the about 44.73% average utilisation of its working capital limits during the 12 months ended March 2016. The ratings are further supported by CWPL's strong EBITDA margins of 13.04% in FY15 (FY14: negative 3.33%) and its promoters' strong track record of over 40 years in the auto industry. RATING SENSITIVITIES Positive: Substantial top-line growth and further improvement in profitability, leading to sustained improvement in credit metrics, will lead to a positive rating action. Negative: A decline in operating profitability, leading to deterioration in credit metrics, will be negative for the ratings. COMPANY PROFILE CWPL was established in January 2013 and manufactures tractor wheels. It exports 20%-25% of its products to Turkey, the UK, USA and Sudan. Its manufacturing plant is located in Shamli, Uttar Pradesh. CWPL's ratings: -- Long-Term Issuer Rating: assigned 'IND B'; Outlook Stable -- INR42.5 million fund-based limits: assigned 'IND B'/Stable/'IND A4' -- INR40 million proposed fund-based-limits: assigned 'Provisional IND B'/Stable/'Provisional IND A4' -- INR7.5 million non-fund based limits: assigned 'IND A4' CHAMUNDA ELECTRICAL: ICRA Assigns B+ Rating to INR1.0cr Loan ------------------------------------------------------------ ICRA has assigned the rating of [ICRA]B+ to INR1.00 crore long term fund based facilities of Chamunda Electrical (P) Limited. ICRA has also assigned the rating of [ICRA]A4 to the INR7.50 crore short term fund based facilities of CEPL. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Cash Credit 1.00 [ICRA]B+ assigned Bank Guarantee 7.50 [ICRA]A4 assigned The assigned ratings are constrained by the moderate scale of operations; limited profitability margins owing to low value addition nature of operations and high competitive intensity the electrical contracting business. The ratings also take into account the high customer concentration of the company's operations with single client being GETCO. ICRA also takes note of the sectoral and geographical risk arising from the company's operations dependent only on operation and maintenance contracts in the Gujarat state. The ratings, however, favourably takes into account the long track record of the promoter in the electrical contracting and maintenance business with more than two decades of experience coupled with company's certification as approved Class A contractor for 'operation and maintenance'. Incorporated in June 2013, Chamunda Electrical (P) Limited (CEPL) is engaged 'Operation and Maintenance' services of GETCO from its office located at Palanpur, Ahmedabad. CEPL is promoted by Mr. Chirag Patel and his father Mr. Natvarlal Rathod. Mr. Patel is engaged in the electrical contracting business since 1994 through his partnership firm which was later converted to proprietorship firm viz- Chamunda Construction Co. that carried out the business of electrical contracting services for Gujarat Energy Transmission Corporation Limited (GETCO). CEPL has been registered as Class 'A' electrical contractor for the 'Operation and Maintenance' services and 'B' class electrical contractor for the erection work wherein it can carry out erection of line on H- Frame Structure & Tower. Recent Results For the financial year ended March 2015, the company reported an operating income of INR9.68 crore and profit after tax of INR0.21 crore as against an operating income of INR4.87 crore and profit after tax of INR0.11 crore during the 6 months of operations for FY 2014. Further in 10M FY2016, the company has reported operating income of INR12.16 crore and profit after tax of INR0.31 crore (as per unaudited provisional financials). CMC COMMUTATORS: ICRA Revises Rating on INR3.35cr Loan to B ----------------------------------------------------------- ICRA has revised the long-term rating assigned to the INR3.00 crore (reduced from INR5.25 crore) cash credit facility, INR2.00 crore (enhanced from INR0.60 crore) term loan facility and INR3.35 crore (enhanced from INR2.00 crore) unallocated limits of CMC Commutators Private Limited from [ICRA]B+ to [ICRA]B. ICRA has re-affirmed the short-term rating of [ICRA]A4 assigned to the INR1.65 crore (reduced from INR2.15 crore) non-fund based limit of CMC. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Cash Credit 3.00 [ICRA]B/Revised from [ICRA]B+ Term Loan 2.00 [ICRA]B/Revised from [ICRA]B+ Unallocated Limits 3.35 [ICRA]B/Revised from [ICRA]B+ Non-Fund Based Limits 1.65 [ICRA]A4/Re-affirmed The rating revision takes note of the drop in profit margin owing to the price fluctuation of raw materials, primarily copper, which could not be passed on to the customers and the high working capital intensity due to high receivables and inventory holding. This, together with, the large debt funded investment in real estate properties lead to reduced financial flexibility with higher interest cost and inadequate funds to meet the working capital requirements. The ratings continue to remain constraint by the small scale of operations that limits economies of scale, the weak debt coverage indicators and the high client concentration risk. The ratings, however, take comfort from the long track record of the promoters of more than three decades in the manufacturing of commutators and moderate gearing of 0.82 times as on March 31, 2015. Going forward, the company's ability to scale up the operations, improve profitability and liquidity position would be the key rating sensitivities. Further, liquidation of the investments in real estate properties in near to medium term would also remain a key rating monitorable. Incorporated in 1977, CMC is owned and managed by Mr. Ramesh Gudi and family. Based in Belgaum (Karnataka), the company is engaged in the manufacturing of industrial commutators, molded commutators and sliprings. The company is ISO 9001:2000 certified. The company has an installed capacity to manufacture 75000 units per month. The promoters of the company own 72% stake in its subsidiary company- Indo Vacuum Technologies Private Limited (IVT) which is engaged in the manufacturing of vacuum pumps. Recent Results For FY 2015, CMC reported a net profit of INR0.25 crore on an operating income of INR11.77 crore, as against a net loss of INR0.47 crore on an operating income of INR10.06 crore in FY 2014. D AND M CABLES: Ind-Ra Assigns 'IND B+' Long-Term Issuer Rating ---------------------------------------------------------------- India Ratings and Research (Ind-Ra) has assigned D and M Cables Private Limited (DMCPL) a Long-Term Issuer Rating of 'IND B+'. The Outlook is Stable. A full list of rating actions is at the end of this commentary. KEY RATING DRIVERS The ratings factor in the company's likely weak credit profile and small scale of operations in FY16. The company's revenue was around INR73m and operating margin was around 3.16% in FY15, as it had only been operational for six months. For FY16, its gross interest coverage is likely to be at 2.5x-3x and net leverage is likely to be 4.5x-5x due to low operating profitability. Ind-Ra expects its revenue to be INR350 million by FYE16. The ratings are further constrained on account of DMCPL's lack of operational track record. However, the ratings are supported by DMCPL's promoter's experience of around three decades in the cables and wires business. RATING SENSITIVITIES Negative: A decline in its overall credit metrics could lead to a negative rating action. Positive: A sustained improvement in overall credit metrics, along with a substantial increase in revenue, will be positive for the ratings. COMPANY PROFILE DMCPL was incorporated in 2013 and began operations in 2014. It manufactures aluminium cable wires at its 12,000mtpa plant in Sonepat, Haryana. DMCPL's ratings: -- Long-Term Issuer Rating: assigned 'IND B+'; Outlook Stable -- INR60 million fund-based working capital limits: assigned Long-term 'IND B+'/Stable and Short-term 'IND A4' -- INR15 million non-fund-based limits: assigned Short-term 'IND A4' D.V. EXPORTS: ICRA Suspends B+ Rating on INR10cr Cash Loan ---------------------------------------------------------- ICRA has suspended the [ICRA]B+ rating assigned to the INR20.0 crore long term fund based facilities of D.V. Exports. The suspension follows ICRA's inability to carry out a rating surveillance in the absence of the requisite information from the company. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Cash Credit 10.00 [ICRA]B+, suspended EPC/FBP/FBN/FOBNLC 10.00 [ICRA]B+, suspended DV Exports is a proprietorship concern of Mr. Rajpal Singh S/o Bhupendra Singh Rajpal, who also holds directorship of Manjeet Cotton Private Limited, with operations purely in cotton trading. The firm is a part of Manjeet Cotton Group which consists of various companies and firms engaged in cotton ginning, cotton pressing and cotton trading activities. The promoters and other family concerns are in the various levels of the cotton value chain and well supported by the Manjeet group which is a dominant player in cotton trading and ginning business in central India. DEVGAN SOLVEX: CRISIL Suspends B+ Rating on INR59MM Cash Loan ------------------------------------------------------------- CRISIL has suspended its ratings on the bank facilities of Devgan Solvex Private Limited (DSPL). Amount Facilities (INR Mln) Ratings ---------- --------- ------- Cash Credit 59 CRISIL B+/Stable Proposed Long Term Bank Loan Facility 1.5 CRISIL B+/Stable Term Loan 19.5 CRISIL B+/Stable The suspension of ratings is on account of non-cooperation by DSPL with CRISIL's efforts to undertake a review of the ratings outstanding. Despite repeated requests by CRISIL, DSPL is yet to provide adequate information to enable CRISIL to assess DSPL's ability to service its debt. The suspension reflects CRISIL's inability to maintain a valid rating in the absence of adequate information. CRISIL considers information availability risk as a key factor in its rating process as outlined in its criteria 'Information Availability - a key risk factor in credit ratings' Incorporated in 1994, DSPL is promoted by Mr. Naresh Kumar and his family and is engaged in the extraction of rice bran oil. Its processing facility located at Amritsar (Punjab). DIVAKAR PV: Weak Financial Strength Cues ICRA SP 3D Grading ----------------------------------------------------------- ICRA has assigned a 'SP 3D' grading to Divakar PV Solar Solutions (DPSS), indicating the 'Moderate Performance Capability' and 'Weak Financial Strength' of the channel partner to undertake solar projects. The grading is valid till December 31, 2017 after which it will be kept under surveillance. Grading Drivers Strengths * Reputed clientele base resulting in lower counter party risk Risk Factors * Early stage of company's operations in the solar segment coupled with relatively small scale of operations * Large number of organized/ unorganized players in the solar industry indicating high level of competition which may lead to difficulties in getting client contracts and may pressurize margins * Weak financial risk profile of the company characterized by operating losses in FY15, high gearing levels with weak coverage indicators * Vulnerability of the profitability to the fluctuations in the raw material prices Fact Sheet Year of Establishment 2013 Office Address Nr. Biliyada Cross Road, At Shemla, Gondal, Rajkot-360331 Managing Partners Mr. Divyarasingh Jadeja Mr. Pratipalsinh Gohil Divakar PV Solar Solutions (DPSS) was established in 2013 as a partnership firm and is engaged in manufacturing of solar modules, solar roof top systems, solar street lights and pumping systems and solar water pumps. The firm started its commercial operations from August 2014 with its plant located at Gondal, Gujarat having an installed manufacturing capacity of 5 MW of solar module (considering one shift of operations). The firm has successfully supplied and installed ~810 KW of solar projects since inception. The current product profile of the firm includes PV module, solar lighting systems, solar power packs, solar pumps, thermal based solar water heaters etc. Promoter Track Record: The promoters have extensive experience of various industries such as Real Estate, Ceramic Tiles, operations of petrol pumps etc. However, the experience in solar operations remains limited to around 1.5 years. Established in 2013, DPSS is engaged module manufacturing and installation of solar PV based instruments like solar roof top system, solar street lighting systems, power packs and solar pumps and has supplied and installed 810 KW solar systems since inception. The firm is also involved in assembly and fabrication of Thermal based solar water heater. DPSS has primarily executed projects for private entities with the operations majorly concentrated in the state of Gujarat. * Technical competence and adequacy of manpower: DPSS has limited experience in executing solar projects. DPSS has executed various projects since August 2014 for solar products amounting to about INR1.87 crore (~810 kw) and has a firm order book position of about ~245 kW of solar products, translating to ~Rs 0.86 crores with deliverables based mainly in Gujarat. DPSS has a total installed capacity of manufacturing 5 MW of solar modules per annum and current capacity utilization levels remains at ~20%, enabling it to cater to increasing demand for solar products in the near to medium term. The entity operates with total staff strength of about 25 personnel, out of which ~5 are Diploma/ Degrees from I.T.I's whereas remaining are the contract laborers. * Quality of suppliers and tie ups: DPSS procures solar cells domestically from the suppliers/traders who imports from China, Taiwan and Korea. Other raw materials such as glass, aluminum frame, backsheet, junction box etc. are procured from domestic suppliers. DPSS enjoys healthy working relationship with most of these suppliers. The company shortlists the vendors based on product certifications, quality parameters and the service levels which suppliers can provide; resulting in minimal hindrances caused due to faulty supplies and increasing product credibility. * Customer and O&M Network: DPSS has executed various solar installations totaling to 810 KW since commencement of solar operations in August 2014. The firm's customer base mainly consists of EPC contractors/manufacturers and also the direct end customers. The company has provided quality deliverables; timely execution and prompt after sales service for the projects. Although currently DPSS operates a small team for its operations; the promoters support and are involved in the day-to- day operations of the firm. Moreover, the operations are supported by network of dealers numbering about 4-5 spread located at Gujarat, Rajasthan and Gurgaon. Financial Strength - Weak Revenues INR0.30 Cr. for FY2015 Return on Capital Employed (RoCE) - Total Outside Liabilities / Tangible Net worth 7.57 times Interest Coverage Ratio - Net-Worth The net-worth of the firm is INR0.09 Cr. (31st March 2015) Current Ratio 1.23 times Relationship with bankers The banker is satisfied with the performance of the accounts The overall financial profile of the firm is weak. EMAAR ALLOYS: CRISIL Lowers Rating on INR95.4MM Cash Loan to D -------------------------------------------------------------- CRISIL has downgraded its rating on long-term the bank loan facility of Emaar Alloys Pvt Ltd (EAPL) to 'CRISIL D' from 'CRISIL B/Stable'. The rating reflects continuous overdrawing in EAPL's cash credit account for more than 30 days consecutively. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Cash Credit 95.4 CRISIL D (Downgraded from 'CRISIL B/Stable') The company has marginal market share and is vulnerable to cyclicality in the steel industry, and has working capital- intensive operations. These weaknesses are partially offset by the extensive experience of the promoters in the sponge iron business. Incorporated in 2004, EAPL manufactures sponge iron. The company is promoted by Mr. Abhimanyu Singh, Mr. Manoj Sinha, and Mr. Vikas Sinha. ESSEL MARKETING: ICRA Lowers Rating on INR10.20cr Loan to B ----------------------------------------------------------- ICRA has revised the long-term rating assigned to the INR10.20 crore fund based facilities (increased from INR9.70 crore) of Essel Marketing & Promotions Private Limited from [ICRA]B+ to [ICRA]B. ICRA has reaffirmed the short-term rating of [ICRA]A4 to the INR2.00 crore short-term, non-fund-based facilities (reduced from INR2.50 crore) of EMPPL. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Fund Based, Rated 10.20 Revised to [ICRA]B on Long-Term Scale from [ICRA]B+ Short-term, non- fund based limits 2.00 [ICRA]A4 reaffirmed The revision in ratings takes into account the significant increase in the debt levels of the company in FY2014 & FY2015 coupled with increase in working capital intensity of operations leading to deterioration of capital structure & debt coverage indicators. Further, the increase in working capital intensity is due to increase in debtor levels since two fiscal years resulting in negative gross cash flows and consequential increase in utilization of working capital loans. The ratings are further constrained by EMPPL's relatively modest scale of operations, high dividend payments thereby impacting cash accruals, high client concentration with top 5 customers accounting for over 91% of total sales turnover in FY2015 and highly competitive industry thereby limting pricing flexibility. The ratings, however, favourably take into account the vast experience of the promoters in the trading of promotional products, the reputed customer base and the company's established relations with the customers which assist in procuring repeat orders. The ratings also factor in the consistent growth in the revenues of the company since last three fiscal years, albeit on a low base. EMPPL, incorporated in 2006 by Mr. Rohit Lamba, is engaged in the supply of a wide range of promotional products typically required in the trade/retail promotional campaigns of Fast Moving Consumer Goods (FMCG) and pharmaceutical companies. EMPPL supplies products such as toys, pencil boxes, plastic jars, stickers, pens, and other customized gift articles. Mr. Lamba is a first generation entrepreneur, supported by a team of professionals in the daily operations of the company. FOURTH DIMENSION: Weak Financial Strength Cues ICRA SP 2D Grading ----------------------------------------------------------------- ICRA has assigned a 'SP 2D' grading to Fourth Dimension Infra and Power Limited, indicating the 'High Performance Capability' and 'Weak Financial Strength' of the channel partner to undertake off-grid solar projects. The grading is valid for a period of two years from February 29, 2016 after which it will be kept under surveillance. Grading Drivers Strengths * Promoters established experience in architecture consultancy and solar business * Healthy growth in solar revenues in FY15 * Moderate order book in place Risk Factors * Small scale of operations * High gearing level of the company * Competitive pressure from other players in the industry Fact Sheet Year of Formation May 2010 Office Address FD House,Prabhat Road, Lane No.5, Deccan Gymkhana, Pune-411004 Partnership Pattern Mr Nitin Waghmare - 84% Others -16% Incorporated in 2010, Fourth Dimension Infra and Power Limited (FDIPL), is a part of Fourth Dimension Group based out of Pune. It is engaged in designing, implementation, commissioning and maintenance of PV based solar power projects. Currently, it is setting up 30 MW solar power park in Village: Andur, District: Osmanabad in Maharashtra. Out of 30 MW, 10 MW has been commissioned and it has order book of 15 MW in place Promoter Track Record: The promoters of the company have significant experience in providing architectural, construction & EPC consultancy services to clients across industries. However, the promoters entered into solar business since 2010 through FDIPL. FDIPL is currently constructing 30 MW solar power park in Village: Andur, District: Osmanabad in Maharashtra. * Technical competence and adequacy of manpower: The solar initiative of the group is headed by the Nitin Waghmare, Ashok Chachra and Satish Kolhekar who have significant experience in EPC consultancy services. For the solar initiative the company has also put in place key executives, who have proven experience in the solar space. The company has total 26 employees of which more than 50% is technical staff with engineering background. * Quality of suppliers and tie ups: FDIPL procures Solar PV Modules from Canadian Solar International Limited. Other components such as transformers, electrical parts & civil structures are procured from Rima Transformer & Conductors Pvt. Ltd, Vacon Drives & Controls Pvt. Ltd and Tata Blue Scope Steel Limited respectively. The company has been associated with most of its suppliers for more than 2 years. * Customer and O&M Network: FDIPL has 15 MW order book in place from S. R. Thorat Milk Products Pvt. Ltd (5 MW) and Altop Ishichi Renewable Projects Pvt. Ltd (10 MW). The company provides one year defect liability period and gives back to back guarantee for the equipments as given by the OEM itself. Going forward, the company also plans to undertake O&M contracts. Financial Strength - Weak Revenues INR14.87 crore in FY15 Return on Capital Employed (RoCE) 71.97% as of FY15 Total Outside Liabilities / Tangible Net worth 15.84 times in FY15 Interest Coverage Ratio 1.44 in FY15 Net-Worth (partner's capital) INR0.30 crore as on March 31, 2015 Current Ratio 0.78 time Relationship with bankers Bankers are satisfied with company's conduct The overall financial profile of the company is weak given low net worth base and high gearing level. GAURAV RICE: CRISIL Suspends B Rating on INR147.1MM Term Loan ------------------------------------------------------------- CRISIL has suspended its rating on the bank facility of Gaurav Rice & Food Processing Private Limited (GRFPPL). Amount Facilities (INR Mln) Ratings ---------- --------- ------- Term Loan 147.1 CRISIL B/Stable The suspension of rating is on account of non-cooperation by GRFPPL with CRISIL's efforts to undertake a review of the ratings outstanding. Despite repeated requests by CRISIL, GRFPPL is yet to provide adequate information to enable CRISIL to assess GRFPPL's ability to service its debt. The suspension reflects CRISIL's inability to maintain a valid rating in the absence of adequate information. CRISIL considers information availability risk as a key factor in its rating process as outlined in its criteria 'Information Availability - a key risk factor in credit ratings' Established in 2012, GRFPPL is setting up a non-basmati parboiled rice mill, with a processing capacity of 150 tonnes per day, in the Vaishali district of Bihar. The company's day-to-day operations are looked after by its promoter-directors Mr. Sunil Kumar, Mrs. Renu Devi, and Mr. Gaurav Gupta. HASAN MARKETING: Weak Financial Strength Cues ICRA SP 3D Grading ---------------------------------------------------------------- ICRA has assigned a 'SP 3D' grading to Hasan Marketing Private Limited, indicating the 'Moderate Performance Capability' and 'Weak Financial Strength' of the channel partner to undertake on- grid solar projects. The grading is valid for a period of two years from March 11, 2016 after which it will be kept under surveillance. Grading Drivers Strengths * Proven experience of promoters in the solar business * Cumulative installation of ~670 kW in place, however remains relatively on a modest level * Client base consists of various government agencies/ departments Risk Factors * Small scale of operations * Order book remains at moderate level for the Solar business * High gearing as well as TOL/TNW, on account of low net worth base * Competitive pressure from other players in the industry Fact Sheet Year of Formation November 2009 Office Address C/O Hotel Mid Town, Ekori Ward, Chandrapur, Maharashtra-442402 Partnership Pattern Hasan Ali - 40% Taher Hasan Ali - 40% Rashidabano Hasan Ali - 20% Incorporated in November 2009, HMPL is primarily engaged in designing; implementation, commissioning and maintenance of PV based solar power projects, both on-grids as well as off-grid domain. Apart from this, the company is also engaged in sales of solar lanterns, solar street lights, home lighting systems etc. Till date the company has executed 0.67 MW of solar PV projects. The grading is for Solar PV SI Related Business - Moderate Performance Capability * Promoter Track Record: The promoters of the company have dealership of major electrical goods companies in Chandrapur via group firm "Hasan Electricals". The promoters incorporated Hasan Marketing Pvt. Ltd in 2009 and have been in the solar business since last 3-4 years. Till date, the company has executed 0.67 MW of solar PV projects and has an order book of 0.77 MW. * Technical competence and adequacy of manpower: For the solar initiative the company has also put in place executives, who have proven experience in the solar space. HMPL has total of 6 key employees including promoters with technical background. * Quality of suppliers and tie ups: HMPL procures Solar PV Modules from Sri Savitr Solar Pvt. Ltd., and Waree Energy Pvt. Ltd. Other components such as electrical parts, invertors, batteries etc. are procured from Olympus Power Pvt. Ltd, Yash Industries and various other companies. The company has been associated with its suppliers for more than 2 years. * Customer and O&M Network: The client base of government departments/companies such as Solar Energy Corporation of India, Zila Parishad, Forest Department, Maharashtra Energy Development Agency etc as well as private companies. The company provides one year defect liability period and gives back to back guarantee for the equipments as given by the OEM itself. Financial Strength - Weak Revenues INR4.61 crore in FY15 Return on Capital Employed (RoCE) 14.46% in FY15 Total Outside Liabilities / Tangible Net worth 15.97 times Interest Coverage Ratio 1.26 times Net-Worth INR0.21 crore Current Ratio 1.91 times Relationship with bankers Bankers are satisfied with company's conduct The overall financial profile of the company is weak given low net-worth base and high gearing level of company. HIVE INFRA: Weak Financial Strength Cues ICRA SP4D Grading ---------------------------------------------------------- ICRA has assigned SP4D grading to Hive Infra Private Limited. The grading indicates Weak performance capability and Weak financial strength of the channel partner to undertake solar projects. The grading is valid for a period of two years from March 18, 2016 after which it will be kept under surveillance. Grading Drivers Strengths * Technically sound management. * Positive feedback from customers, suppliers and banker. * Strong Networth of directors. Risk Factors * Large number of unorganized players indicating high level of competition may lead to pressure on margins. * Nascent stage of operation in solar business * Losses being made at operating levels * Relatively smaller scale of operations Fact Sheet Year of Establishment 2007 Registered Office Address D-1, Kings Court, Shivaji Park, Kolhapur Incorporated in the year 2007, Hive Infra Private Limited (HIPL) act as system integrator for installation of solar water pumping systems and solar roof top projects. Director of the company have around 30 years of experience in real estate sector and 1 year of experience in solar sector. HIPL has an employee base of 10 to 12 permanent employees and hires contractual labours as and when required. The company has its registered office located in Kolhapur. Product profile of the company includes system integration and installation of Solar Water Pumping System and Solar roof top projects. Till date, the company has executed total of 5 KWp of solar projects till date. As per management, HIPL has an order book of INR550 KWp of solar projects to be executed by March 2017 and is in discussion with other customers to get new orders. SI Related Business - Weak Performance Capability Directors' Track Record: Mr. Jayesh Natwarlal Barot and Ms. Upasana Jayesh Barot are the director of the company. Mr. Jayesh Barot has around 30 years of experience in real estate business and 1 year of experience in solar sector. Technical competence and adequacy of manpower: HIPL act as system integrator for installation of solar water pumping systems and solar roof top projects Till date, the company has executed total of 5 KWp of solar water pumping systems till date. As per management, HIPL has an order book of INR550 KWp of solar projects to be executed by March 2017 and is in discussion with other customers to get new orders. The company has an employee base of 10 to 12 permanent employees and hires contractual labours whenever required. Quality of suppliers and tie ups: As per management, the entity sources various products like solar panels, solar pump structure, invertors, etc. required from various suppliers such as Vikram Solar Private Limited, Shakti Pumps (India) Limited, etc. Customer and O&M Network: Till date, the company has installed total of 5Kw solar water pump at the residence of Mr. Jayesh Natwarlal Barot. Management has indicated that they have an order book of 550 Kwp of solar pump system and solar roof top projects to be executed by March 2016. HIPL works to integrate systems for the customer directly at various sites. HIPL has tie-ups with various suppliers of products required for installation of solar water pumps and solar power projects to provide servicing for 2 to 3 years after installation INDO VACUUM: ICRA Revises Rating on INR2.20cr Cash Loan to B ------------------------------------------------------------ ICRA has revised the long-term rating assigned to the INR2.20 crore (reduced from INR4.15 crore) cash credit facility and INR1.50 crore (reduced from INR2.05 crore) term loan facility of Indo Vacuum Technologies Private Limited from [ICRA]B+ to [ICRA]B. ICRA has also re-affirmed the short-term rating of [ICRA]A4 assigned to the INR0.50 crore (reduced from INR0.85 crore) non-fund based limit of CMC. ICRA has also revised long- term rating from [ICRA]B+ to [ICRA]B and re-affirmed the short- term rating assigned to the INR3.35 crore (enhanced from INR0.50 crore) unallocated limit of IVT. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Cash Credit 2.20 [ICRA]B/Revised from [ICRA]B+ Term Loan 1.50 [ICRA]B/Revised from [ICRA]B+ Non-Fund Based Limits 0.50 [ICRA]A4/Re-affirmed Unallocated Limits 3.35 [ICRA]B/Revised from [ICRA]B+/[ICRA]A4/Re-affirmed The rating revision takes note of the drop in profit margin owing to the increase in input cost and adverse foreign exchange fluctuation since imports account for 40% of the total raw material procurement which could not be passed on to the customers due to intense competition. Further, large debt funded investment in real estate properties lead to stretched liquidity with higher interest cost and inadequate funds to meet the working capital requirements. The ratings continue to remain constraint by the small scale of operations that limits economies of scale, weak debt coverage indicators and high working capital intensity on account of high inventory holding. The ratings also remain constrained by the intense competition; however, technology tie-ups with Korean players provide a competitive edge to IVT over other players in terms of better quality. The ratings, however, take comfort from the long track record of the promoters of more than a decade in the manufacturing of vacuum pump, moderate gearing of 0.99 times as on March 31, 2015 and long established relationship with the customers. Going forward, the company's ability to scale up the operations, improve profitability and liquidity position would be the key rating sensitivities. Further, liquidation of the investments in real estate properties in near to medium term would also remain a key rating monitorable. Incorporated in 2001, IVT is owned and managed by Gudi family and is engaged in the manufacturing of a range of vacuum pumps in Belgaum (Karnataka). The company was established as a 50:50 joint venture with Woosung Vacuum Co Ltd, based out of South Korea; however, in 2009 the promoter family bought the stake from the Korean company. IVT is a subsidiary of its group concern- CMC Commutators Private Limited (CMC) with latter holding 72% stake in the former. Recent Results For FY 2015, IVT reported a net loss of INR0.21 crore on an operating income of INR7.58 crore, as against a net loss of INR0.48 crore on an operating income of INR6.84 crore in FY 2014. JAL EXPORTS: ICRA Reaffirms B+/A4 Rating on INR12cr LT Loan ----------------------------------------------------------- ICRA has assigned a long-term rating of [ICRA]B+ and re-affirmed the short-term rating of [ICRA]A4 for the INR12.00 crore fund- based limits and the INR0.50 crore non-fund based limits of Jal Exports. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long-term/Short- term Fund based limits 12.00 [ICRA]B+/[ICRA]A4 reaffirmed Short-term Non- fund based limits 0.50 [ICRA]A4 reaffirmed The re-affirmation of ratings continues to take into account the long and established track record of the partners of Jal Exports (JE) in the textile industry. ICRA notes the firm's established relationships with its customers in the international market and its healthy growth in revenues in FY2015. The ratings, however, are constrained by the firm's weak financial profile as characterized by low profitability margins, moderate debt-protection metrics and stretched capital structure. The rating is also constrained by the exposure of the firm's profitability to adverse fluctuations in raw material prices, given the high inventory holding period. ICRA notes the exposure to foreign exchange risks, although this is partially mitigated due to an active hedging policy. Furthermore, the rating is constrained due to the high working capital intensity and the intense competitive pressures in the business. Incorporated in 1976 as a partnership firm, Jal Exports (JE) is a Government recognized Star Export House engaged in the manufacturing and export of high fashion readymade garments (mainly men's casual shirts) catering mainly to the export markets of Europe, South America, USA and UK. The firm's registered office is located in Mumbai, and its manufacturing facilities are at Karnataka and Maharashtra with a total installed production capacity of 7.0 lakh pieces of ready garments annually. The firm primarily sells its products to private label brands like Lee Cooper and Seaport in the international markets. Recent Results The firm reported a Profit before Tax (PBT) of INR0.22 crore on an operating income (OI) of INR41.21 crore in FY2015, as compared to a PBT of INR0.49 crore on an OI of INR36.86 crore in FY2014. JSW STEEL: Fitch Cuts Issuer Default Rating to 'BB' --------------------------------------------------- Fitch Ratings has downgraded JSW Steel Limited's Long-Term Issuer Default Rating (IDR) to 'BB' from 'BB+'. The Outlook remains Negative. The agency also downgraded JSW Steel's senior unsecured rating and the rating on its $US500m 4.75% senior unsecured notes due 2019 to 'BB' from 'BB+'. The downgrade reflects the decline in profitability and rise in leverage during a prolonged period of weak international steel prices, coupled with debt-funded investment in capacity expansion. We expect JSW Steel's leverage to moderate, given that higher capacity is now on stream, and our assumption of a gradual improvement in average selling price (ASP) from financial year 2017 (FY17, ending March 2017) following government measures to support domestic prices. However, there are still risks to ASPs from a premature lifting of regulatory protection and to financial profiles should the company embark on another phase of debt-funded expansion. KEY RATING DRIVERS Challenging Market Conditions: JSW Steel's profitability has been severely affected by weak steel prices in 9MFY16. Its consolidated blended EBITDA per unit declined to around INR4,800/ton(t) ($US75/t) from INR7,800/t ($US130/t) in FY15, hit by a INR8,500/t ($US170/t) fall in ASP. The global steel industry is suffering from weak demand and overcapacity, and global capacity utilisation is at a level last seen during the 2008-2009 global financial crisis. Demand growth was tepid in India at 4.7% in 9MFY16, met largely by imports which jumped by 29% yoy. Supportive Regulation: Some relief has been provided by recent government action such as Minimum Import Prices (MIP) and a 20% safeguard duty (extended until March 2018) to protect domestic manufacturers from import pressure, with domestic steel prices having risen by around INR4,000/t (INR60/t) from the January 2016 lows. Nonetheless, prices are about 20% lower than the average for FY15, and domestic steel capacity is scheduled to jump by about 15 million tons over 2H15 and 2016. Fitch's forecast assumes that further price hikes will be constrained in the near term, given the heightened competition among domestic producers to support utilisation rates. However, should the government remove the protectionist policies ahead of any significant improvement in the global steel market, this would derail the company's ability to develerage to a level consistent with its current 'BB' rating. Higher Leverage: We estimate JSW Steel's consolidated FFO net leverage to jump to 6.4x in FY16 from 4.5x in FY15, due to the weak profitability. Leverage should moderate to 5.0x in FY17 and 4.1x by FY18. JSW Steel completed the expansion of its capacity by around 4 million tons per annum (mpta) to 18 mpta in March 2016. The company should benefit from FY17 from the completion of its capacity expansion, with lower capex and contribution to operating cash flows. For our leverage forecasts, we assume a gradual increase in ASPs. Hence, they are subject to the risk of weaker-than-expected steel prices. Robust Operational Profile: JSW Steel is among the largest steel producers in India. The company has a dominant market share in southern and western India where its plants are located, and its market position is supported by a rising share of value-added products. Its highly efficient operations and low costs for energy and labour result in one of the lowest conversion costs globally. Absence of Vertical Linkages: JSW Steel has minimal vertical integration for both iron ore and coking coal. This results in higher costs compared with some of its peers, because it needs to purchase these raw materials. However, the company's low conversion costs have mitigated the impact to a large extent. In the current scenario, JSW Steel has in fact benefited from the fall in raw material prices compared with integrated players. Lack of domestic mining leases has also insulated the company from political and legal risks related to licence cancellation. KEY ASSUMPTIONS Fitch's key assumptions within our rating case include: -- Average sales volume growth of 15% in FY17 and FY18, and around 5% annually thereafter. Volume growth would be driven by recent capacity expansion and improving utilisation rates. -- ASP to improve by 3% in FY17, and by 5% over each of the next two years. -- EBITDA margin to improve to 16%-17% in FY17-FY18, from 14% in FY16. EBITDA per ton would bounce back in FY17-FY18 from FY16 lows, but remain below the FY15 level. -- Annual capex of around INR40billion in FY17, and INR25billion thereafter. RATING SENSITIVITIES Positive: Developments that may, individually or collectively, lead to the Outlook being revised to Stable include: -- Improvement in FFO net leverage to below 4.0x by FY18 -- Ability to generate positive FCF by FY18 Negative: Developments that may, individually or collectively, lead to negative rating action include: -- Inability to improve FFO net leverage to below 4.0x by FY18 -- Failure to generate positive FCF by FY18 K.C. TIMBER: CRISIL Assigns B Rating to INR80MM Credit Limit ------------------------------------------------------------ CRISIL has assigned its 'CRISIL B/Stable' rating to the long-term bank loan facilities of K.C. Timber Traders (KCTT). Amount Facilities (INR Mln) Ratings ---------- --------- ------- Buyer Credit Limit 80 CRISIL B/Stable Cash Credit 20 CRISIL B/Stable The rating reflects the firm's modest scale of operations in the highly fragmented timber trading business, and weak financial risk profile because of small networth, high gearing, and subdued interest coverage ratio. These weaknesses are partially offset by its partners' extensive industry experience and their funding support. Outlook: Stable CRISIL believes KCTT will continue to benefit over the medium term from its partners' extensive industry experience. The outlook may be revised to 'Positive' in case of significant increase in revenue and cash accrual, and improvement in capital structure. Conversely, the outlook may be revised to 'Negative' if the firm reports lower-than-expected cash accrual or larger- than-expected working capital requirement, leading to pressure on financial risk profile, particularly liquidity. KCTT, set up as a partnership firm by Mr. Manish Bansal and Mr. Romesh Bansal in 1991, trades in timber logs primarily imported from West Africa and Latin America. The firm has its head office and three warehouses in New Delhi. KAMAKHYA TRANSFORMERS: Ind-Ra Assigns 'IND BB' LT Issuer Rating --------------------------------------------------------------- India Ratings and Research (Ind-Ra) has assigned Kamakhya Transformers (KT) a Long-Term Issuer Rating of 'IND BB'. The Outlook is Stable. A full list of rating actions is at the end of this commentary. KEY RATING DRIVERS The ratings reflect KT's moderate scale of operations and moderate credit profile. In FY15, its revenue was INR136 million (FY14: INR120 million), net financial leverage (net debt/EBITDA) was 1.7x (0.7x) and EBITDA interest coverage (EBITDA/gross interest) was 5.7x (3.4x). Its operating EBITDA margin was 9.1% for FY15 (FY14: 9.4%). The ratings also factor in the partnership nature of the organisation. However, the ratings benefit from KT's founders' experience of over two decades in the manufacture of distribution transformers as well as the company's existing relationship with valued customers such as the Assam State Electricity Board and Manipur Public Work Department (Irrigation) Department. RATING SENSITIVITIES Positive: A sustained improvement in its scale of operations, along with an increase in profitability, leading to an overall improvement in its credit profile, could lead to a positive rating action. Negative: A decline in the scale of operations, along with deterioration in profitability, leading to deterioration in its credit profile, could lead to a negative rating action. COMPANY PROFILE KT was incorporated in 2009 in Guwahati (Assam), by seven partners: Mr. Deepak Agarwal, Ms. Prita Agarwal, Ms. Rakhi Agarwal, Mr. Govindram Agarwal, Mr. Pramod Kumar Agarwal, Mr. Kamal Kant Agarwal and Mr. Bharat Agarwal. It manufactures and repairs distribution transformers with voltage capacities from 10kVA 1ph. to 630kVA 3ph. The company has a tie-up with the Central Power Research Institute in Bhopal for transformer testing. KT's ratings: -- Long-Term Issuer Rating: assigned 'IND BB'; Outlook Stable -- INR16 million fund-based working capital limits: assigned 'IND BB'; Outlook Stable -- INR23 million non-fund-based working capital limits: assigned 'IND A4+' -- INR13.5 million proposed non-fund-based working capital limits: assigned 'Provisional IND A4+' LB COTTON: ICRA Lowers Rating on INR5cr LT Loan to D ---------------------------------------------------- ICRA has revised the long term rating to [ICRA]D from [ICRA]B for the INR10.00 crore long-term fund based bank facilities of LB Cotton Industries LLP. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term- Term Loan 5.00 Revised to [ICRA]D from [ICRA]B Long Term Cash Credit 5.00 Revised to [ICRA]D from [ICRA]B The downward revision of rating primarily incorporates the instances of delay in debt servicing on account of lack of adequate cash flows to service its debt obligations driven by the cyclical trend in line with the seasonality of cotton crop and ginning business. The rating also takes into account the adverse capital structure of the firm on account of debt-funded capex, reliance on external borrowings to fund the working capital gap and weak tangible net worth. The rating also factors in subdued profitability on account of limited value addition and highly competitive and fragmented industry structure due to low entry barriers. Besides, the profitability is vulnerable to movement of raw cotton prices, which are subject to seasonality of crop, global demand-supply indicators and government regulations. Further, being a partnership firm, any withdrawal from the capital account can have an adverse impact on the capital structure of the firm. The rating, however, takes into account the significant experience of the promoters in the trading of agricultural commodities and the advantage arising from established relations with farmers through associate concerns. The ginning facility of LCIL is located in Nanded, which by virtue of being the cotton producing belt of India, accords the firm easy access to raw cotton. LB Cotton Industries LLP, was established as a partnership firm in August 2011 and commenced ginning operations from October 2013 and seed crushing from December 2014. The firm has its processing facility located at Dharmabad, Nanded and has a seasonal (eight months) installed input capacity of 28800 MTPA. Recent Results The firm recorded a net loss of INR0.79 crore on an operating income of INR37.89 crore in FY15. LINERS INDIA: ICRA Assigns 'C' Rating to INR12.50cr Loan -------------------------------------------------------- ICRA has assigned the long-term rating of [ICRA]C to INR12.50 crore1 fund based limits and short term rating of [ICRA]A4 to INR2.00 crore non fund based limits of Liners India Limited. ICRA has also assigned the long term / short term rating of [ICRA]C / [ICRA]A4 to INR0.50 crore unallocated limits of LIL. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Fund based limits 12.50 [ICRA]C assigned Non Fund based limits 2.00 [ICRA]A4 assigned Unallocated limits 0.50 [ICRA]C/[ICRA]A4 assigned The assigned ratings are constrained by the weak financial profile of the company characterized by net losses incurred in the past three financial years, high gearing and stretched coverage indicators. The ratings factor in the constrained liquidity position as indicated in high average utilization of working capital limits owing to high working capital requirements given the long collection period and high lead time in manufacturing. The ratings also takes into account the company's limited pricing power and its significant dependence on the M&HCV and tractor segment which are marked by cyclical demand. The ratings are further constrained by the company's exposure to fluctuations in the raw material prices and foreign exchanges. The ratings favorably factors in the longstanding experience of promoters in liners manufacturing and mechanical engineering industry, established position of the company as a recognized vendor in the liners sector to reputed clientele such as Mahindra & Mahindra Limited, Ashok Leyland, John Deere, Tata Motors Limited, Enfield Cycle Co. Limited etc. and long standing relationships with clients as demonstrated by repeat orders. Going forward, the ability of the company to improve its margins and capital structure, while effectively managing its working capital requirements, will be the key rating drivers from credit perspective. Liners India Limited was originally established in 1974 as a partnership firm by Mr. S Ganesh; the firm was reconstituted as a private limited company in 1986 and to a public limited company in 1994. LIL has two divisions: cylinder liner manufacturing and automobile components trading. LIL manufactures cylinder liners and cast iron products used in diesel automotive engines. LIL supplies to original equipment manufacturers of heavy, medium, and light commercial vehicles, tractors, and diesel engines worldwide. The company has manufacturing units in Vijayawada (Andhra Pradesh), and Rudrapur (Uttarakhand) with an installed capacity of 24 crore liners per annum. The company has set up the trading division after acquisition of Jai Motors Ltd in January 2009. LIL is a distributor in South India for automotive component manufacturing companies and LIL is an exclusive distributor of Shriram Pistons & Rings Ltd and Allied Nippon Ltd for AP, Telangana, Karnataka, Kerala, and Tamil Nadu. Recent Results For FY2015, the company reported net loss of 4.26 crore on an operating income of 106.80 crore as against net loss of INR114.74 crore on an operating income of INR114.74 crore during FY2014. MAHADEV INDUSTRIES: ICRA Reaffirms B Rating on INR20.80cr Loan -------------------------------------------------------------- ICRA has reaffirmed long term rating of [ICRA]B on the INR20.8 crore1 (enhanced from INR19.0 crore) working capital facility and short term rating of [ICRA]A4 on the INR5.0 crore warehouse receipts of Mahadev Industries. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Cash Credit 20.80 [ICRA]B; reaffirmed Warehouse Receipts (WHR) 5.00 [ICRA]A4; reaffirmed ICRA's ratings continue to be constrained by the intensely competitive nature of the industry in which Mahadev Industries operates, which exerts pressure on its operating margins. The ratings also take into account Mahadev Industries' high working capital intensity, with NWC/OI2 at 50% for FY2015 owing to increased inventory holding period. This has resulted in high reliance on bank borrowings, which coupled with the company's thin profitability has resulted in elevated gearing and weak debt coverage indicators. The ratings however, continue to derive support from the firm's experienced management and its presence in the paddy producing belt of India, which ensures easy availability of raw material. The rating also factors in the firm's established relationship with its customers and the positive demand outlook for the rice industry, with India being the second largest producer and consumer of rice in the world. Mahadev Industries was established in 2000 with Mr. Kapil Kumar, Mr. Kulbhusan Lal, Mr. Chaand Dhawan, Mr. Kunal Dhawan and Mr. Vikas Kumar as its partners. It has an installed milling capacity of 4 metric tonnes (MT) per hour and sorting capacity of 4 MT per hour. It undertakes milling of basmati as well as non-basmati rice, however ~75% of its revenue is derived from basmati rice. Recent Results The firm achieved an operating income (OI) of INR72.92 crore and a profit after tax (PAT) INR0.28 crore in FY2015, as against an OI of INR60.59 crore and a PAT of INR0.35 crore in the previous year. MAHAKALESHWAR INFRATECH: Ind-Ra Affirms IND BB+ LT Issuer Rating ---------------------------------------------------------------- India Ratings and Research (Ind-Ra) has affirmed Mahakaleshwar Infratech Private Limited's (MIPL; erstwhile Mahakaleshwar Construction) Long-Term Issuer Rating at 'IND BB+'. The Outlook is Stable. KEY RATING DRIVERS The ratings reflect MIPL's continued moderate credit metrics with interest coverage (operating EBITDA/gross interest expense) of 6.99% in FY15 (FY14: 7.86x) and gross leverage (total adjusted debt/operating EBITDAR) of 1.06x (0.89x). The ratings also reflect MIPL's nature of business which has high susceptibility to government regulations and availability of tenders/projects; any adverse change in the policy could hamper the operations severely. MIPL's current order book position is moderate at around INR580 million for FY17. The ratings are also affected by MIPL comfortable yet declining EBITDA margins (FY15: 11.11%; FY14: 11.72%) mainly on account of increasing administrative expenses. The ratings are supported by the company's established track record of over a decade in civil construction work. RATING SENSITIVITIES Negative: A decline in the revenue, along with deterioration in the credit metrics will be negative for the ratings. Positive: A significant improvement in the revenue while profitability, credit metrics and liquidity profile are maintained at the current levels will be positive for the ratings. COMPANY PROFILE Established in 2005 as a proprietorship concern, the company was converted into a private limited entity in April 2015. It is into engineering, procurement and construction work mainly related to road construction for various government departments. MIPL's ratings: -- Long-Term Issuer Rating: affirmed at 'IND BB+', Outlook Stable -- INR40 million fund-based working capital limit (increased from INR20 million): affirmed at Long-term 'IND BB+'/Stable and Short-term 'IND A4+' -- INR280 million non-fund-based limit (increased from INR130 million): affirmed at Short-term 'IND A4+' MAN COTT: Ind-Ra Assigns 'IND BB' Long-Term Issuer Rating --------------------------------------------------------- India Ratings and Research (Ind-Ra) has assigned Man Cott Private Limited (MCPL) a Long-Term Issuer Rating of 'IND BB'. The Outlook is Stable. The agency has also assigned MCPL's INR250.00 million fund-based working capital limits an 'IND BB' rating with a Stable Outlook. KEY RATING DRIVERS The ratings reflect MCPL's small scale of operations and moderate credit profile. In FY15, the company reported revenue of INR1262m, EBITDA interest coverage of 1.2x and net financial leverage of 5.0x. The EBITDA margins have been fluctuating since FY13 on account of volatile raw material prices and industry competition and were 3.1% in FY15. However, liquidity has been comfortable as reflected by the company's average utilisation of 63% of the working capital limits during the 2 months ended December 2016. The ratings are supported by the company's founders' experience of more than two decades in the cotton ginning business. RATING SENSITIVITIES Positive: A positive rating action may result from a substantial improvement in the scale of operations along with an improvement in the credit metrics of the company. Negative: A negative rating action may result from a decline in the scale of operations along with deterioration in the credit metrics. COMPANY PROFILE Incorporated in 2003, MCPL is promoted by Shri Bhupendra Singh Rajpal and Shri Rajendra Singh Rajpal of Manjeet Group of Sendhwa, Madhya Pradesh. It is primarily engaged in ginning and pressing of cotton and a 290bales/day manufacturing unit in Pimpalgaon (Maharashtra) and a 180bales/day manufacturing unit in Kuppa (Maharashtra). MANGAL SPONGE: ICRA Lowers Rating on INR25cr Cash Loan to B+ ------------------------------------------------------------ ICRA has revised downwards the long-term rating assigned to the INR2.50 crore1 term loans and INR25.00 crore fund-based bank facilities of Mangal Sponge and Steel Private Limited (MSSPL) to [ICRA]B+ from [ICRA]BB-. Also, ICRA has reaffirmed the short-term rating of [ICRA]A4 assigned to the INR8.00 crore non-fund based bank facilities of MSSPL. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Term Loans 2.50 [ICRA]B+; revised from [ICRA]BB-/Stable Fund-Based Limits 25.00 [ICRA]B+; revised from (Cash Credit) [ICRA]BB-/Stable Non-Fund Based Limits 8.00 [ICRA]A4; reaffirmed The downwards revision of the ratings take into consideration the ongoing slowdown in the steel industry, which is likely to keep MSSPL's turnover and profitability under pressure as reflected by a decline in its turnover and profitability during 2015-16. The downwards revision also takes into account the risk associated with the execution of the new induction furnace, proposed to be partly funded by a fresh term loan, which would impact MSSPL's liquidity position in the short to medium term. The ratings also take into consideration the long track record of the company in steel business and partially integrated nature of MSSPL's operations, which supports the profitability of the company to an extent, though the profit margins are estimated to decline during 2015-16. However, the ratings are constrained by the relatively small size of MSSPL's operations at present and MSSPL's weak return on capital employed because of a low operating profitability and low capacity utilisation levels during 2014-15 and 2015-16. The ratings are also impacted by the a high working capital intensive nature of MSSPL's operations as reflected by high inventory levels during the recent years and MSSPL's exposure to the inherent cyclicality of the steel industry, which is likely to keep the company's profitability and cash flows volatile. MSSPL, a closely held company by the Bilaspur based Agrawal Family, started production of sponge iron in 2004-05 followed by mild steel (MS) billets in 2009-10. The company is headed by Mr. Moolchand Agrawal as its managing director and supported by its directors, Mr. Suresh Agrawal, Mr. Manoj Agrawal and Mr. Ashish Agrawal. The plant of the company is located at Bilha Industrial Area, Bilaspur (Chhattisgarh). MSSPL has facilities for manufacturing sponge iron and billets with an annual capacity of 90,000 MT and 50,400 MT per annum respectively. Recent Results In 2014-15, as per the audited financial statements, MSSPL reported an operating income of INR76.12 crore and a net profit of INR0.24 crore, as against an operating income of INR88.11 crore and a net profit of INR0.29 crore in 2013-14. During the first nine months in 2015-16, the company reported an operating income of INR39.76 crore and a profit before tax of INR0.09 crore. NEW FRONT: ICRA Suspends B Rating on INR20cr LT Loan ---------------------------------------------------- ICRA has suspended [ICRA]B rating assigned to the INR20.00 crore long term fund based facilities of New Front Prabhavee Ventures.The suspension follows ICRA's inability to carry out a rating surveillance in the absence of the requisite information from the company. NFPV has been formed in December 2010 in order to develop residential and commercial real estate projects. The new front group has executed more than 20 projects in the past and all the promoters have experience of more than three decades in real estate development. Currently the firm is developing two residential projects. NOVEL SUGAR: Ind-Ra Affirms 'IND BB' Long-Term Issuer Rating ------------------------------------------------------------ India Ratings and Research (Ind-Ra) has affirmed Novel Sugar Limited's (NSL) Long-Term Issuer Rating at 'IND BB'. The Outlook is Stable. The agency has also affirmed NSL's INR47.5 million fund-based working capital limit at 'IND BB'/Stable/'IND A4+'. KEY RATING DRIVERS The affirmation reflects NSL's muted revenue growth in FY15 on account of poor realisation, and its small scale of operations. The ratings continue to be constrained by NSL's declining operating margins over the years (FY15: 6.23%, FY14: 6.63%, FY13: 7.90%) due to volatility in raw material prices and depressed sugar prices. Also, its liquidity remains stretched as reflected in almost full utilisation of the working capital facilities on average during the 12 months ended February 2016. The ratings however continue to be supported by NSL's strong credit metrics with gross interest coverage (EBITDA/gross interest expenses) of 4.89x in FY15 (FY14: 5.1x) and leverage (net adjusted debt/EBITDA) of 2.22x (1.78x). RATING SENSITIVITIES Positive: A sustained improvement in the top line while the profitability, credit metrics and liquidity profile being maintained or improving will be positive for the ratings. Negative: A sustained decline in the revenue, an increase in margin pressures or deterioration in the credit metrics and liquidity profile will be negative for the ratings. COMPANY PROFILE Established in 2003 by Yogesh Kumar Agarwal and Anupam Singhal, NSL manufactures khandsari sugar. Its 150 metric tonnes per day plant is located in Pilibhit, Uttar Pradesh. The company does not have any long-term loans. OMKAR INFRACON: Ind-Ra Assigns 'IND BB-' Long-Term Issuer Rating ---------------------------------------------------------------- India Ratings and Research (Ind-Ra) has assigned Omkar Infracon Private Limited a Long-Term Issuer Rating of 'IND BB-'. The Outlook is Stable. A full list of rating actions is at the end of this commentary. KEY RATING DRIVERS The ratings reflect OIPL's small scale of operations and moderate weak profile. In FY15, revenue was INR111 million (FY14: INR123 million), interest coverage was 0.6x (2.2x), net financial leverage was 15.4x (3.1x) and EBITDA margin was 6.5% (23%). Ind- Ra expects the credit metrics to improve during FY16 with a fall in raw material prices. The ratings also reflect the company's tight liquidity situation as reflected in its close to 100% maximum utilisation of the fund-based limits on an average for the six months ended February 2016. The ratings are supported OIPL's founders' experience of more than five years in manufacturing fly ash brick. The ratings are also supported by the company's low customer concentration with its top five customers accounting for 38% of revenue during 11MFY16. RATING SENSITIVITIES Positive: An improvement in the overall credit metrics would lead to a positive rating action. Negative: Deterioration in the overall credit metrics would lead to a negative rating action. COMPANY PROFILE OIPL was incorporated in 2010 and started its commercial operations in August 2012. The company has a 143,000MT per year fly ash brick plant near Kolaghat thermal power plant in West Bengal. OIPL's ratings: -- Long-Term Issuer Rating: assigned 'IND BB-'/Stable -- INR35.00 million fund based working capital limit: assigned 'IND BB-'/Stable -- INR39.36 million long-term loans: assigned 'IND BB-'/Stable -- INR6.00 million non-fund based working capital limits: assigned 'IND A4+' ORCHID CURE: CRISIL Reaffirms B+ Rating on INR105MM Term Loan ------------------------------------------------------------- CRISIL's rating on the long-term bank facility of Orchid Cure and Care Private Limited (OCCPL) continues to reflect the company's below-average financial risk profile because of high gearing and weak debt protection metrics, largely due to recently completed debt-funded capital expenditure to set up a hospital. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Term Loan 105 CRISIL B+/Stable (Reaffirmed) The rating also factors in exposure to risks associated with initial phase of operations. These weaknesses are partially offset by its promoters' established presence and extensive experience in the healthcare segment at Vishrantwadi in Pune, and expected steady cash generation once operations are stabilised. Outlook: Stable CRISIL believes OCCPL will benefit from its promoters' established presence and extensive industry experience in stabilising operations. The outlook may be revised to 'Positive' if operations stabilise faster than expected, cash accrual is higher than expected, and working capital cycle is small. Conversely, the outlook may be revised to 'Negative' if operations stabilise slower than expected, leading to low cash accrual and pressure on liquidity. OCCPL, incorporated in September 2012, has a multi-specialty hospital with 60 beds in Pune. The hospital commenced commercial operations in February 2016. PAWAN KUMAR: CRISIL Assigns B+ Rating to INR80MM Cash Loan ---------------------------------------------------------- CRISIL has assigned its 'CRISIL B+/Stable' rating to the long- term bank facility of Pawan Kumar Prem Kumar (PKP). Amount Facilities (INR Mln) Ratings ---------- --------- ------- Cash Credit 80 CRISIL B+/Stable The rating reflects the firm's modest scale of operations in a highly competitive industry, susceptibility of business and profitability to volatility in raw material prices, and its below-average financial risk profile marked by high total outside liabilities to total debt (TOLTNW) ratio. These weaknesses are partially offset by promoter's extensive experience in the agricultural commodities trading business leading to established customer and supplier relationships, and efficient working capital management Outlook: Stable CRISIL believes that PKP will benefit from its promoter's extensive industry experience and diverse product portfolio. The outlook may be revised to 'Positive' if financial risk profile improves because of sizeable capital infusion or large accretion to reserve driven by sustained and substantial increase in revenue and profitability. Conversely, the outlook may be revised to 'Negative' if liquidity weakens due to considerably low cash accrual (with decline in revenue or profitability), increase in working capital requirement, or sizeable debt-funded capital expenditure. PKP is a proprietorship firm of Mr. Pawan Goyal, set up in 1988. It trades in agricultural commodities and is based in Sri Ganganar, Rajasthan. The firm recorded book profit of INR1.88 million on operating income of INR530.5 million in 2014-15 (refers to financial year, April 1 to March 31), against book profit of INR1.76 million on operating income of INR568.6 million in 2013-14. RAHIS COLD: CRISIL Assigns 'B' Rating to INR75MM Cash Loan ---------------------------------------------------------- CRISIL has assigned its 'CRISIL B/Stable' rating to the long-term bank facility of Rahis Cold Storage Private Limited (RCS). Amount Facilities (INR Mln) Ratings ---------- --------- ------- Cash Credit 75 CRISIL B/Stable The ratings reflect RCS's initial stage of operations and exposure to highly regulated and fragmented nature of the West Bengal cold storage industry. These weaknesses are partly mitigated by the promoters' extensive experience in the cold storage and potato trading business. Outlook: Stable CRISIL believes RCS will benefit over the medium term from its promoters' industry experience. The outlook may be revised to 'Positive' if increase in scale of operations and adequate cash accrual is generated along with efficient management of farmers financing. Conversely, the outlook may be revised to 'Negative' if lower-than-expected cash accrual or stretch in realisation of loans from farmers weakens liquidity. Incorporated in August 2014 by Mr. Sk Jakir Ali and Ms. Tasmina Begam, RCS has recently set up a potato cold storage facility in Burdwan, West Bengal. The company has successfully commenced commercial operations in March 2016. RATIONAL HANDLOOM: Ind-Ra Assigns IND BB Long-Term Issuer Rating ---------------------------------------------------------------- India Ratings and Research (Ind-Ra) has assigned Rational Handloom Company Private Limited (RHCPL) a Long-Term Issuer Rating of 'IND BB' with a Stable Outlook. A full list of rating actions is given at the end of this commentary. KEY RATING DRIVERS The ratings reflect RHCPL's modest revenue growth with declining margins of 2.7% in FY15 compared with 3.5% in FY12 as well as its weak credit metrics, with net leverage (Ind-Ra adjusted net debt/operating EBITDAR) of 4.8x in FY15 (FY14: 4.8x) and EBITDAR interest cover of 1.5x (1.4x). In addition, the company's liquidity is stretched, with over 87% average utilisation of its sanctioned fund-based working capital limits for the 12 months ended February 2016 and consistently negative operating cash flow over FY12-FY15. The ratings are further constrained by severe competition in the retail industry, further intensified on account of compounded growth in e-commerce retailers, over the past few years However, the ratings are supported by its promoter's experience of more than three decades in the retail industry, diversified product profile and efficient working capital management on account of cash receivables and low inventory storing. RATING SENSITIVITIES Negative: Any deterioration in operating profitability and/or an increase in debt, resulting in significant weakening of credit metrics from FY15 levels, will result in a negative rating action. Positive: Significant improvement in operating profitability, resulting in sustained improvement in credit metrics, will result in a positive rating action. COMPANY PROFILE RHCPL was started as a proprietorship concern named M/s National Handloom Corporation, by Mr. Lalit Mehta in 1982; it was a shop in Jodhpur that sold handloom items. It was incorporated as RHCPL in 2000 and currently runs 12 showrooms: nine in Rajasthan and three in Gujarat. RHCPL's ratings: -- Long-Term Issuer Rating: assigned 'IND BB'; Outlook Stable -- INR350 million fund-based working capital facilities: assigned 'IND BB/Stable/'IND A4+' -- INR124.82 million term loan: assigned 'IND BB'; Outlook Stable RHIZOME DISTILLERIES: CRISIL Ups Rating on INR110MM Loan to B+ -------------------------------------------------------------- CRISIL has upgraded its rating on the long-term bank facilities of Rhizome Distilleries Pvt Ltd (RDPL) to 'CRISIL B+/Stable' from 'CRISIL B-/Stable'. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Long Term Loan 110 CRISIL B+/Stable (Upgraded from 'CRISIL B-/Stable') Secured Overdraft 60 CRISIL B+/Stable (Upgraded Facility from 'CRISIL B-/Stable') The upgrade reflects CRISIL's belief that the company's business and financial risk profiles will continue to improve over the medium term because of healthy growth in revenue and profitability and hence better debt protection metrics. Revenue was of INR102 million for the six months ended September 31, 2015, and is estimated at INR250 million for 2015-16 (refers to financial year, April 1 to March 31) aided by higher licensed capacity and retail sales in the Telangana region. Operating profitability is also expected to improve to around 16 percent in 2015-16 from 7.6 percent in 2014-15 with cost efficiencies from increased revenue. The upgrade also factors in moderate liquidity due to adequate cash accrual for debt repayment. Cash accrual is expected at INR32-37 million per annum over the medium term against annual debt obligations of INR27 million. CRISIL expects RDPL to have healthy revenue growth over the medium term, backed by strong demand for its products and supported by higher licensed capacity. The rating reflects RDPL's large working capital requirement, high degree of geographic concentration in its revenue profile, and susceptibility of operations to regulatory changes in the distillery industry. The rating also factors in a below-average financial risk profile because of a modest net-worth, high gearing, and average debt protection metrics. These rating weaknesses are partially offset by the extensive industry experience of the company's promoters. Outlook: Stable CRISIL believes RDPL will continue to benefit over the medium term from its promoters' extensive industry experience. The outlook may be revised to 'Positive' in case of sustained increase in scale of operations while profitability is maintained, or a substantial improvement in the company's working capital cycle. Conversely, the outlook may be revised to 'Negative' in case of a steep decline in profitability margins, or significant deterioration in its capital structure caused most likely by a stretched working capital cycle. RDPL was set up in 1993 by Mr. Manoj Rupani and his family members, and was taken over by Mr. Nishanth Bezawada and his family members in 2014-15. The company manufactures and sells India-made foreign liquor in Telangana and also has a job-work contract with Associated Breweries and Distilleries Ltd. The company's manufacturing unit is in Hyderabad. S. NANDA: ICRA Assigns B+ Rating to INR12cr LT Loan --------------------------------------------------- ICRA has assigned its [ICRA]B+ rating to the INR16.0 crore long- term fund-based bank facilities of S. Nanda Industries Private Limited. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term; Fund Based Limits 12.0 [ICRA]B+; assigned Long Term; Unallocated Limits 4.0 [ICRA]B+; assigned The assigned rating is constrained by the highly competitive nature of the textile industry owing to its fragmented nature, low value added nature of SNIPL's business with majority of the revenues coming from trading sales, and exposure to risks arising from fluctuations in prices of yarn and fabric. The rating is also constrained by modest financial profile characterised by low profitability, moderate return indicators and high gearing. However, the rating favourably takes into account the established track record and extensive experience of the promoters in the textile industry and the diversified customer base which reduces product off-take risk. Going forward, the ability of the firm to improve the profitability of its operations and prudently manage its working capital cycle will be the key rating sensitivities. SNIPL, promoted by Mr Sudhir Nanda in 1992, is engaged in the business of manufacturing and trading of cotton yarn, polyester fibre, recycled fibre and knitted yarn. Most of the sales (~98%) of the company are from trading operations. The company also manufactures fancy yarn at its own manufacturing capacities located in Ludhiana which has 39 machines with total capacity of 800-900 tonnes per annum. Recent Results SNIPL reported a net profit of INR0.22 crore on an operating income of INR167.59 crore in FY15 as against a net profit of INR0.28 crore on an operating income of INR136.04 crore in the previous year. As per the provisional results, the company reported an operating income of INR143.2 crore in the first eleven months of FY16. SAMBASADASHIV COLD: ICRA Suspends D Rating on INR7cr Loan --------------------------------------------------------- ICRA has suspended the long term rating of [ICRA]D assigned to INR7.00 crore term loan limits of Sambasadashiv Cold Roll Mills Private Limited (SCRMPL). 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. Sambasadashiv Cold Roll Mills Private Limited was incorporated in 2009 to manufacture cold rolled steel strips from hot rolled steel coils. The proposed unit is located at Laxmakkapally Village, Mulugu Mandal, Medak Dist., A.P. which is around 25 kms from the Hyderabad city. The company is promoted by Mr. Kapil Sharma and Mr. Umesh Sharma. The promoters are well experienced in iron & steel trading and the unit will be run under the direct supervision & control of the promoters. SANGO AUTO: CRISIL Raises Rating on INR15MM Term Loan to B+ ----------------------------------------------------------- CRISIL has upgraded its rating on the long-term bank facilities of Sango Auto Forge Private Limited (SAFPL) to 'CRISIL B+/Stable' from 'CRISIL B/Stable' and reaffirmed its rating on short-term bank facilities at 'CRISIL A4'. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Cash Credit 10 CRISIL B+/Stable (Upgraded from 'CRISIL B/Stable') Letter of Credit 40 CRISIL A4 (Reaffirmed) Proposed Long Term 9.7 CRISIL B+/Stable (Upgraded Bank Loan Facility from 'CRISIL B/Stable') Term Loan 15 CRISIL B+/Stable (Upgraded from 'CRISIL B/Stable') For arriving at the rating, CRISIL has combined the business and financial risk profiles of SAFPL and ANC Industries Pvt Ltd (AIPL; formerly, ANC Enterprises). This is because these entities, together referred to as the ANC group, are in similar lines of business, have significant operational and financial linkages with each other and have common promoters. The rating upgrade reflects CRISIL's belief that the group's credit profile will improve over the medium term on account of increase in scale of operations and equity infusion by the promoters. Operating Income is expected to increase by about 25 percent to INR317 million in 2015-16 from INR253.4 million in the previous year while its operating margin is expected to remain steady in the range of 15-16 percent. Also the promoters have infused equity of INR41 million over the past 9 months ending December 2015 and are further expected to infuse INR16 million in the near term. This is expected to result in an improvement in the networth and capital structure and the group's networth and gearing are estimated to improve to INR132.9 million and 1.39 times as on March 31 2016 as against INR75.5 million and 2.43 times respectively as on March 31 2015. Further, the group's annual net cash accrual is estimated to increase to INR190-220 million over the medium term from INR14 million in 2014-15. However the group's liquidity is expected to remain stretched over the medium term because of working capital intensive operations resulting in fully utilized bank lines. The ratings reflect the group's small scale of operations, large working capital requirements, high customer concentration in revenue profile, and susceptibility to cyclicality in the commercial vehicle industry. The ratings also factor in the group's below-average financial risk profile because of moderate net worth and sub-par debt protection metrics. These rating weaknesses are partially offset by the extensive industry experience of its promoters. Outlook: Stable CRISIL believes that the ANC group will continue to benefit over the medium term from its promoters' extensive industry experience. The outlook may be revised to 'Positive' if the group's liquidity improves significantly, most likely driven by sizeable equity infusion or improvement in its working capital management. Conversely, outlook may be revised to 'Negative' if the group's revenue and profitability decline, or it undertakes a large debt-funded capital expenditure programme, thereby weakening its financial risk profile, particularly its liquidity. AIPL undertakes the machining of components used in the automobile industry. The firm operates two machining units at Bhosari in Pune (Maharashtra) with an installed capacity of 600 tonnes per month (tpm). SAFPL, incorporated in 2007, has a forging capacity of 350 tpm and caters to AIPL's forging requirements. SHARMA CONSTRUCTION: CRISIL Assigns B+ Rating to INR50MM Loan ------------------------------------------------------------- CRISIL has revoked the suspension of its ratings on the bank facilities of Sharma Construction Co. (SCC) and has assigned its 'CRISIL B+/Stable/ CRISIL A4' ratings to these facilities. The ratings had been suspended by CRISIL on September 16, 2014, as SCC had not provided the necessary information for taking a rating view. The firm has now shared the requisite information, enabling CRISIL to assign ratings to the bank facilities. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Bank Guarantee 30 CRISIL A4 (Assigned; Suspension Revoked) Cash Credit 50 CRISIL B+/Stable (Assigned; Suspension Revoked) Proposed Long Term 28 CRISIL B+/Stable (Assigned; Bank Loan Facility Suspension Revoked) Proposed Standby 12 CRISIL B+/Stable (Assigned; Line of Credit Suspension Revoked) The ratings reflect modest scale of operations in the intensely competitive civil construction industry with geographical concentration and its average financial risk profile because of modest networth and working capital-intensive operations. These rating weaknesses are mitigated by the promoter's extensive experience in the civil construction industry and healthy operating profitability of the firm. Outlook: Stable CRISIL believes SCC will continue to benefit over the medium term from its promoter's extensive industry experience. The outlook may be revised to 'Positive' if increase in revenue along with prudent working capital management leads to higher-than-expected net cash accrual. Conversely, the outlook may be revised to 'Negative' if financial risk profile weakens on account of decline in revenue and profitability or in case of any large, debt-funded capital expenditure or if liquidity weakens significantly on account of increase in working capital requirement. SCC, a proprietorship firm of Mr. Rajinder Attri, was established in 1991 in Sangrur, Punjab. The firm undertakes civil construction works, mainly roads. SCC, registered as a class I contractor, generally undertakes the contracts for government organization's majorly Public Works Department (PWD), Municipal Corporations (MC), Development Authorities (DA) by biding through tenders. SCC's book profit was INR8.0 million on net sales of INR117.4 million in 2014-15 (refers to financial year, April 1 to March 31), against a book profit of INR5.9 million on net sales of INR112.7 million in 2013-14. SHIVAM COTTEX: ICRA Reaffirms B+ Rating on INR6cr Cash Loan ----------------------------------------------------------- ICRA has reaffirmed the long term rating of [ICRA]B+ to the INR1.50 crore1 term loan facility and INR6.00 crore cash credit facility of Shivam Cottex. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Fund Based Term Loan 1.50 [ICRA]B+ reaffirmed Fund Based Cash Credit 6.00 [ICRA]B+ reaffirmed The reaffirmation of rating continues to factor in stretched financial profile of Shivam Cottex (SC) characterized by modest scale of operations, low profitability and weak debt coverage indicators. The ratings are further constrained by stretched liquidity position due to high inventory level as evident from high working capital limit utilization. The ratings also continue to be constrained by the highly competitive and fragmented industry structure with the limited value additive nature of operations, which leads to pressure on profitability. The rating further incorporates the vulnerability to adverse movements in agricultural produce prices and any regulatory policy changes in terms of export and MSP. Also, being a partnership firm, substantial withdrawals by the partners can have an adverse impact on capital structure of the firm. The rating, however, positively considers the experience of the partners in the cotton industry as well as the favorable location of the firm, giving it easy access to high quality raw cotton. Shivam Cottex was established in February 2011 as a partnership firm owned and is managed by Mr. Kanubhai Vaghasiya, Mr. Rameshbhai Vaghasiya, Mr. Ashokbhai Vaghasiya and Mr. Hareshbhai Vaghasiya. Firm is engaged in raw cotton ginning and pressing. The manufacturing unit is located at Jasdan in Rajkot District, Gujarat. The firm is equipped with 24 ginning machines and one pressing machine with an installed capacity of producing 200 cotton bales per day (24 hours). Recent Results In FY15, the firm reported an operating income of INR30.03 crore and net profit of INR0.05 crore against an operating income of INR31.32 crore and net profit of INR0.17 crore in FY14. SHREE RENUKA: Ind-Ra Downgrades Long-Term Issuer Rating to IND D ---------------------------------------------------------------- India Ratings and Research (Ind-Ra) has downgraded Shree Renuka Sugars Limited's (SRSL) Long-Term Issuer Rating to 'IND D' from 'IND BB-'. The Outlook was Negative. The agency has also downgraded SRSL's INR2,500 million non-convertible debenture programme to 'IND D'. The Outlook was Negative. KEY RATING DRIVERS The downgrade indicates SRSL's delays in servicing its bank loan obligations for the six months ended 31 March 2016 on account of a stretched liquidity position. The agency's downgrade of the rating on the NCD reflects the impaired debt servicing capability currently. Ind-Ra attributes this to a significant deterioration in the consolidated EBITDA amid poor profitability in its domestic milling as well as in its overseas Brazilian operations. This coupled with depreciation in the Brazilian real has resulted in an increase in debt levels and affected SRSL's consolidated credit profile. SRSL reported consolidated net leverage of 20.0x (FY14: 10.5x) and interest coverage of 0.5x in FY15 (FY14: 1x). Ind-Ra in the previous rating action commentary had highlighted the refinancing risk the company would have to face in FY16. SRSL on a standalone basis had repayment obligations to the tune of (maturities of long-term loans) of INR4.1 billion and INR2.2 billion for FY16 and FY17, respectively. SRSL under the Joint Lenders Forum is in talks with its bankers for refinancing/restructuring its loans; however, uncertainty looms over the outcome of the same. The company's operating cash flows and its repayment capabilities have been affected due to muted sugar realisations in FY15 which has transpired a sharp correction in international and domestic sugar commodity prices. The ratings continue to reflect the vulnerability of sugar companies to government policies relating to cane pricing. In addition, SRSL remains exposed to the cyclicality risk of the sugar industry, climatic conditions and to comparative prices for other remunerative crops which determine acreage and sugar production. The ratings are underpinned by around 20 years of operating experience of SRSL's founders, the company's proximity to the sugar producing belt of Maharashtra and Karnataka with high recovery levels (11%-12%) as well as by the cushion available from high by-product realisations. For the purpose of its analysis, the agency has taken a consolidated view of SRSL, which includes the standalone entity (Indian operations) as well as its domestic and overseas subsidiaries (Brazilian operations). RATING SENSITIVITIES Positive: An improvement in SRSL's liquidity profile coupled with timely servicing of debt obligations for at least three consecutive months could result in a positive rating action. COMPANY PROFILE SRSL operates seven sugar mills in India with a total crushing capacity of 8.4 million metric tons per annum or 42,000 tons crushed per day. It also has two port-based sugar refineries with a total capacity of 2.3 million metric tons per annum. SRSL also has a significant presence in South Brazil, through the acquisitions of Renuka Vale do Ivai (100% owned) and Renuka do Brazil (59.4% owned). For 9MFY15, SRSL on a standalone basis reported sales of INR4,044.2 billion and an EBIDTA loss of INR54.7 million. SHRI BALAJI: ICRA Reaffirms B+ Rating on INR8cr Cash Loan --------------------------------------------------------- ICRA has reaffirmed the [ICRA]B+ rating to INR9.00 crore long term fund based facilities of Shri Balaji Ginning Factory. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term, Fund based limits Cash Credit 8.00 [ICRA]B+ reaffirmed Long Term, Fund based limits Term Loan 1.00 [ICRA]B+ reaffirmed The rating reaffirmation takes into account easy availability of raw cotton on back of favourable location and substantial experience of the promoters in the cotton ginning industry. The rating is however constrained by leveraged capital structure of the firm due to working capital intensive operations and low profit margins in line with low value add nature of business. Though, the gearing has improved in FY15 on account of repayment of short term debt of INR2.6 crore and decrease in working capital intensity resulting into decrease in cash credit utilisation. ICRA also takes note of moderate scale of operations and vulnerability associated with agro climatic conditions and regulatory environment which has direct bearing on capacity utilization and profitability of the firm. Established in 2004, SBGF is a proprietorship concern promoted by Mr. Aditya Goyanka. The firm is engaged in ginning and pressing of cotton and crushing of cotton seeds. Ginning facility of the firm is located in Hinganghat in Wardha district of Maharashtra. The plant has 36 gins with an annual capacity of 60000 bales. SHRIMAN ENTERPRISES: ICRA Assigns 'B' Rating to INR36cr Loan ------------------------------------------------------------ ICRA has assigned its long-term rating of [ICRA]B to the INR36.00 crore, fund-based bank facilities of Shriman Enterprises. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Fund-based facilities Term loans 36.00 [ICRA]B assigned ICRA's rating takes into account the project execution risk considering that the project is at a nascent stage at present and typically long gestation periods in new hospital projects, in light of which there may be losses in the initial year(s) which may require additional funding. The rating is also constrained on account of single asset nature of the entity limiting its geographical presence and scale and also the firm's constitution as a partnership concern exposing it to capital withdrawal risk etc. However, the rating draws comfort from SE's healthy operational prospects supported by the presence of experienced partners from diverse medical fields, which also mitigates the risk of attrition of key doctors. Further, the rating is supported by the favourable location of the project with ease of accessibility from the city. Going forward, the firm's ability to get the balance promoters' contribution as planned; implement the project within scheduled cost and time estimates; and ensure healthy operating metrics post-launch of operations, would be the key rating sensitivity. Constituted in 2015, SE is a partnership firm that is setting up a 150-bedded multi-speciality hospital in Jalandhar (Punjab). All the four partners of the firm are qualified doctors having relevant experience across different medical fields. The key project details are summarised in the adjoining table. The project is estimated to cost INR48.00 crore and is being funded in a debt: equity ratio of 3:1. Term loan for funding the capex has been tied up, and is repayable in 84 monthly instalments starting October 2017. SPJ SOLAR: Weak financial strength Cues ICRA SP 4D Grading ---------------------------------------------------------- ICRA has assigned 'SP 4D' grading to SPJ Solar Technology Private Limited. The grading indicates Weak performance capability and Weak financial strength of the channel partner to undertake off- grid solar projects. The grading is valid till two years from March 14, 2016. Grading Drivers Strengths * Well established relationships with the customers and suppliers as evident from the satisfactory feedbacks received * Healthy Order book position * Reputed customer base consisting of various government organizations including GAIL India Limited, ONGC, etc Risk Factors * Limited experience in the solar industry and limited contribution of solar operations in the top line * Leveraged capital structure reflected by the gearing of 2.25x; however entirely consists of the unsecured loans * Large number of unorganized players indicating high level of competition may lead to pressure on margins * Top line dependent on the ability of the company to successfully bid for tenders Fact Sheet Year of Establishment 2008 Office Address D-7/ F-2, Jyoti Nagar East, Loni Road, Shahdara, Delhi- 110093 Manufacturing facility Plot No. 3 Near Jain mandir, Sector 10, Vasundhara, Ghaziabad, Uttar Pradesh 201012 Established in June 2008, SPJ Solar Technologies Private Limited (SPJ), an ISO 9001:2008 certified company, is engaged in the manufacturing of solar and electrical CFL and LED lights. The manufacturing facility is located in Vasundhara, Ghaziabad in a total area of ~3,000 square feet and employs 9 employees. The entity provides a warranty of 1 to 5 years depending on the size and quality of the battery. Raw material procurement The company procures products like batteries, pole, solar panels and other consumables from reputed suppliers like Luminous Power Technologies Private Limited, Waaree Energies Limited, etc while few of the consumables are procured from the local markets also. However, the products like bulb are manufactured in-house. SI Related Business Moderate Performance Capability Promoter Track Record: Mr. Shailendra Jain, Director Mr. Shailendra Jain carries a total experience of ~30 years however the experience in the solar industry is ~3 years .i.e. since the commencement of SPJ. Mr. Jain is a graduate and looks after the finance and accounts operations of the business. Mr. Nishant Jain, Director Mr. Nishant Jain, son of Mr. Shailendra Jain looks after the production, procurement and the delivery functions of the business. He has been associated with the business since 2013 and holds a B.Tech degree. Mrs. Mamta Jain, Director Mrs. Mamta Jain is a graduate and looks after the administrative functions of the business. She has been associated with the company since 2013. Technical competence and adequacy of manpower: The total manpower of the company is 9 which include two B. tech and two ITI graduates looking after the technical issues of the business. Apart from this, there are 5 skilled and unskilled workers for undertaking the manufacturing activities. The employee base for the company looks adequate at the current scale of operations. Quality of suppliers and tie ups: The company has been procuring the products from reputed supplies like Luminous Power Technologies Private Limited, Waaree Energies Limited, etc while few of the consumables are also procured from the local markets. The company has been associated with these suppliers since past three years and enjoys a cordial relationship with them. Customer and O&M Network: The customer base of the company includes several government and private organizations such as Gail India Limited, ONGC Limited, PRG International Electrical Private Limited, etc. The orders from the government organization are tender based and contributes to ~50% of the total revenues. Going forward company has a healthy order book position which is expected to result in increase in turnover. Financial Strength - Weak Revenues Revenues of INR0.53 crore in FY15 INR1 crore in FY16 (11m) period and expects to earn INR1.45 crore in full year Return on Capital Employed (RoCE) 10.66% in FY15 Total Outside Liabilities / Tangible Net worth 2.38 times Interest Coverage Ratio 1.95 times Net-Worth INR0.16 crore Current Ratio 18.45 times Relationship with bankers SPJ has recently availed a cash credit limit of INR0.10 crore and bank guarantee limit of INR0.60 crore The overall financial profile of the firm is weak SREE NARAYANA: CRISIL Suspends B- Rating on INR80MM Term Loan ------------------------------------------------------------- CRISIL has suspended its rating on the bank facilities of Sree Narayana Guru Trust (SNGT; part of the Sree Narayana Guru Group). Amount Facilities (INR Mln) Ratings ---------- --------- ------- Proposed Term Loan 20 CRISIL B-/Stable Term Loan 80 CRISIL B-/Stable The suspension of rating is on account of non-cooperation by SNGT with CRISIL's efforts to undertake a review of the ratings outstanding. Despite repeated requests by CRISIL, SNGT is yet to provide adequate information to enable CRISIL to assess SNGT's ability to service its debt. The suspension reflects CRISIL's inability to maintain a valid rating in the absence of adequate information. CRISIL considers information availability risk as a key factor in its rating process as outlined in its criteria 'Information Availability - a key risk factor in credit ratings'. Set up in 1998, the group runs an engineering college, namely, the Gurudeva Institute of Science and Technology, in Kottayam, Kerala. SNGT is constituted and managed by the Sree Narayana Dharma Paripalana (SNDP) Kottayam Union. SRI ADHITYA: ICRA Assigns B- Rating to INR5.0cr LT Loan ------------------------------------------------------- ICRA has assigned a long term rating of [ICRA]B- to the INR5.00 crore long term fund based facilities and the INR0.67 term loan facility of Sri Adhitya Polyfilms Private Limited. ICRA has also assigned a short-term rating of [ICRA]A4 to the INR2.25 crore non-fund based facilities of SAPPL. ICRA has also assigned a long-term/ short-term rating of [ICRA]B- /[ICRA]A4 to the INR0.08 crore unallocated limits of SAPPL. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long-term Fund based limits 5.00 [ICRA]B-/Assigned Long-term Term loans 0.67 [ICRA]B-/Assigned Short-term - Non fund based limits 2.25 [ICRA]A4/Assigned Long-term/ Short- term - Unallocated 0.08 [ICRA]B-/A4 /Assigned The assigned ratings take into consideration the significant experience of SAPPL's promoters in the flexible packaging industry, spanning over 15 years; and the established track record of the company's operations. The rating also considers the company's established clientele, including companies such as Amruthavarshini Dairy Farms Pvt. Ltd., Sakthi Masala Pvt. Ltd. and Tamil Nadu Salt Corporation; and SAPPL's ability to retain its customers, resulting in very low churn witnessed over the past fiscals. The rating also takes into account the positive demand outlook for the flexible packaging industry in India supported by increasing purchasing power of consumers. The ratings are, however, constrained by SAPPL's financial risk profile, characterized by higher gearing and moderate interest cover and debt protection metrics. SAPPL's operations were affected during the Chennai floods, with the company suffering inventory losses as well as damage to capital assets leading to net worth erosion, which has adversely impact its capital structure and liquidity position. The ratings are further constrained by high working capital intensity owing to stretched receivables and high inventory holding period; and SAPPL's small scale of operations restricting economies of scale and financial flexibility. The ratings also consider the fragmented nature of flexible packaging industry, leading to intense competition that limits SAPPL's pricing flexibility and scope for margin expansion. The ratings also factor in SAPPL's exposure to volatility in raw material prices given the limited bargaining power with suppliers and customers; and the exposure to forex fluctuations. Going forward, the company's ability to scale up its operations, while improving its liquidity and working capital position would be critical to generate cash flows. Sri Adhitya Polyfilms Private Limited was incorporated in 2002 and commenced its operations in 2003. SAPPL is engaged in manufacturing flexible packaging material in roll form as well as pouch form, through the printing and laminating of plastic films. The company initially started with a capacity of 900 tonnes per annum (MTPA) and has expanded to current levels of 2000 MTPA. The company largely caters to localized demand from manufacturers of food products situated across Tamil Nadu, Andhra Pradesh and Karnataka. SAPPL operates out of its manufacturing facility at SIDCO Industrial Estate, Ambattur, Chennai. SAPPL is managed by Mr. S. P. Mohan Subramanian and Mrs. Vidhya Mohan who together manage the overall operations of the company. Recent Results As per provisional results, the company reported a profit-before- tax of INR0.12 crore on an operating income of INR10.26 crore in 7 months FY 2015-16. During FY 2014-15, the company has reported a profit after tax of INR0.13 crore on an operating income of INR15.69 crore as against a profit after tax of INR0.09 crore on an operating income of INR10.87 crore in FY 2013-14. SRI KRISHNA: ICRA Reaffirms 'B' Rating on INR10.69cr Loan --------------------------------------------------------- ICRA has reaffirmed the long-term rating [ICRA]B to INR10.69 crore (revised from INR9.69 crore) fund based limits and INR4.31 crore (revised from INR5.31 crore) unallocated limits of Sri Krishna Kireeti Food Products. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Fund based limits 10.69 [ICRA]B re-affirmed Unallocated limits 4.31 [ICRA]B re-affirmed The ratings are constrained by the weak financial profile of the firm characterised by low profitability, high gearing, modest coverage indicators, and stretched liquidity position. The ratings are further constrained by small scale of operations, high competition in the industry, and the susceptibility of profitability and revenues to agro-climatic risks which can impact the availability of the paddy in adverse weather conditions. ICRA notes that the reduction in levy has resulted in greater supplies to the open market, which has resulted in improved average realizations for the industry. However, the sustainability of the prices in a competitive environment is yet to be seen. The rating continues to be constrained by the vulnerability to any other regulatory changes, especially those pertaining to minimum support price and export restrictions. The rating also takes into account the risks inherent to the partnership nature of the firm. The ratings, however, take comfort from the long track record of the promoters in the rice mill business, the easy availability of paddy with proximity of the plant to the major paddy cultivating region of Andhra Pradesh and benefit from the group entities (Sri Srinivasa Rice Mill) which have established relationships with several customers. Further, favourable demand prospects for the industry, with India being the second largest consumer and producer of rice internationally, augurs well for the firm. Sri Krishna Kireeti Food Products was established as a partnership firm in January 2012 by Mr. C.H.S.V. Satyanarayana Murthy and other family members. The firm is engaged in milling of paddy to produce Raw and Boiled Rice and its by-products. The rice milling unit is located in East Godavari District of Andhra Pradesh and it has an installed capacity of 5 tonnes per hour. Recent Results According to audited results, the firm reported profit after tax of 0.05 crore on an operating income of 24.71 crore for FY2015, as against a profit after tax of INR0.05 crore on an operating income of INR29.47 crore during FY2014. SRI LAKSHMI: ICRA Suspends B+ Rating on INR17cr Loan ---------------------------------------------------- ICRA has suspended the long term rating of [ICRA]B+ assigned to the INR17.00 crore fund based facilities of Sri Lakshmi Kantha Boiled and Raw Rice Mill. ICRA has also suspended the ratings of [ICRA]B+/[ICRA]A4 assigned to the INR3.00 crore unallocated limits of SLKBRRM. The suspension follows ICRA's inability to carry out a rating surveillance in the absence of the requisite information from the company. Founded as a partnership firm in 1994, Sri Lakshmi Kantha Boiled and Raw Rice Mill is engaged in milling of paddy to produce raw and boiled rice. The firm is promoted by Mr. Veeera Raghava Reddy and is located in East Godavari District of Andhra Pradesh. The total installed capacity of the plant is 10 tons per hour. SRI SAI: ICRA Assigns 'B' Rating to INR5.60cr Unallocated Loan -------------------------------------------------------------- ICRA has assigned a long term rating of [ICRA]B for the INR5.60 crore unallocated fund based limits of Sri Sai Shivanagere Solar Power Private Limited. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Fund Based Limits/ Unallocated 5.60 [ICRA]B/Assigned The rating takes into account the incipient stage of the project, with SPL yet to obtain financial closure and certain key approvals; and that the work on the project is yet to commence. The rating is also constrained by execution risks, including that of time and costs overruns; and the promoter's limited track record in power generation. The rating also considers the small scale of its planned operations with only 1.1MW of generation capacity, and SPL's modest financial risk profile with high gearing and stretched debt protection metrics in the initial years of its operation. The rating also factors in the sensitivity of solar power generation to any adverse variations in weather conditions as well as to panel degradation, which would negatively impact the cash flows of the company. The rating however, favourably takes into account the Power Purchase Agreement (PPA) with BESCOM for full installed capacity with healthy tariffs locked in for 25 years. The rating also considers the favourable regulatory environment with both central power regulators and KERC incentivizing private renewable power generation. Timely commencement and execution of the project without any major cost overruns remain the key rating sensitivities. Sri Sai Shivanagere Solar Power Private Limited (SPL) was incorporated in June 2015. SPL plans to set up a 1.1 MW solar power plant at Kallukote Village, Sira Taluk, Tumkur District, Karnataka. The solar power plant is expected to be commissioned in September 2016 and a Power Purchase Agreement (PPA) has been signed by SPL with BESCOM for a period of 25 years. SRINITHI ENTERPRISES: ICRA Upgrades Rating on INR7cr Loan to BB- ---------------------------------------------------------------- ICRA has upgraded the long term rating for the INR7.00 crore fund based limits (Cash Credit facility) and the INR2.00 crore proposed long term facilities of Srinithi Enterprises Private Limited from [ICRA]B+ to [ICRA]BB-. The outlook on the rating is Stable. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long-term fund- based limits (Cash Credit facility) 7.00 [ICRA]BB-(Stable)/Upgraded Proposed long term facilities 2.00 [ICRA]BB-(Stable)/Upgraded The rating upgrade takes into account of healthy revenue growth witnessed over the last two fiscals, supported by SEPL's established customer and supplier network, and favourable demand for its key products - Butter, Ghee and Skimmed Milk Powder. The rating also considers SEPL's financial profile characterised by moderate gearing and adequate interest cover and debt protection metrics. The rating continues to draw comfort from the established track record and experience of its promoters in trading of milk and milk products; and the positive demand outlook for the company's products, over the medium to long term. The rating is, however, constrained by SEPL's thin profitability, due to the trading nature of its business; and the intense competition in a highly fragmented industry that restricts scope for margin expansion by limiting pricing flexibility. The rating also considers SEPL's tight liquidity position with its working capital facilities being fully utilized; nevertheless ICRA takes cognisance of the unsecured loans extended by SEPL's promoters in the current year, which is likely to ease its liquidity position to an extent. Incorporated in the year 2009, Srinithi Enterprises Private Limited is primarily engaged in trading milk and milk products like butter, ghee and skimmed milk powder (SMP). The promoters of the company have been involved in similar business for over a generation and have vast experience in the business. The company procures milk products in bulk primarily from suppliers in Andhra Pradesh, Tamil Nadu, Delhi, Maharashtra & Karnataka and caters to the demand from both organised and unorganised players in Tamil Nadu, Andhra Pradesh, Uttarakhand, Uttar Pradesh and Haryana, among others. Major customers include Patanjali Ayurved Limited, Urmila Milk Products, Bharath Ghee Store and Markandeshwar Foods & Allied Products Ltd. Recent Results During FY 2014-15, the company has reported a profit after tax of INR0.75 crore on an operating income of INR95.90 crore as against a profit after tax of INR0.53 crore on an operating income of INR73.36 crore in FY 2013-14. As per provisional results, the company has achieved an operating income of INR461.11 crore in 11 months FY 2015-16. STEEL AUTHORITY: Fitch Cuts LT FC Issuer Default Rating to 'BB' --------------------------------------------------------------- Fitch Ratings has downgraded Steel Authority of India Limited's (SAIL) Long-Term Foreign-Currency Issuer Default Rating (IDR) to 'BB' from 'BBB-'. The Outlook is Negative. The downgrade follows the deterioration in SAIL's financial profile after a prolonged weakening in international steel prices. SAIL's debt-funded capex programme has magnified the impact of weak prices. SAIL posted an EBITDA loss of INR25.3 billion in the nine months to 31 December 2015, compared with an EBITDA of INR36.8 billion a year earlier, due to weak steel prices, competition from increased steel imports into India and muted steel demand growth in India. Fitch expects SAIL's financial profile to remain weak for the next 18 months and improve only moderately towards the end of the financial year to 31 March 2018 (FY18). Indian steel demand is likely to improve over the medium term, which will support better profitability at SAIL. This will help the company to reduce net leverage to below 4.5x after FY18. The Negative Outlook reflects the risk of further weakening in steel prices, increases in Indian steel imports and weaker-than- expected steel demand over the next 12-18 months, which would make it difficult for SAIL to improve its profitability and thus its leverage. KEY RATING DRIVERS Challenging Market Dynamics: Indian steel makers have been battling falling steel prices, high imports and muted demand during the last 12 months. The imposition of a minimum import price by the Indian in February 2016 and the extension of a safeguard duty on certain steel imports till March 2018 will provide some relief to domestic producers. Indian steelmakers' profitability is likely to improve during 4QFY16 and 1HFY17. However, muted demand and expectations of overcapacity will limit the benefits of the measures for Indian steel producers in 2016. Fitch expects profitability of Indian steel producers, including SAIL, to remain weak in FY17. Weak Financial Profile: SAIL's financial profile has deteriorated significantly due to the EBITDA losses and increasing debt levels driven by its capex. We expect SAIL's financial profile to remain weak in FY17 with minimal improvement in EBITDA margin and additional debt from the final stage of its capex programme. SAIL's financial profile is likely to improve only from FY18, when sales volumes increase and profitability widens following better operating efficiency and cost control measures. Fitch expects SAIL's net leverage to reduce below 4.5x by FY19. Capex Largely Complete: SAIL's has almost completed its capex programme for modernising and expanding its manufacturing facilities after significant delays. Only the expansion of the Bhilai steel plant has yet to be finished. SAIL is enhancing its crude steel capacity to 21.4 million tonnes per annum (FY15: 13.9 mtpa) and has spent INR615.5 billion so far towards modernisation and expansion of the manufacturing facilities, and increasing iron ore and coal mining capacity. The delay in completion of the capex from the originally planned end-FY13 or early FY14, has resulted in weaker than expected cash flows and significantly higher debt. Comfortable Liquidity: SAIL had cash balance of INR20 billion and unutilised working capital limits of around INR11 billion at the end of 2015. This compares with debt maturities of INR16.6 billion in FY17. SAIL's cash balance has been steadily decreasing due to its capex programme. However, with its major capex projects nearing completion, Fitch expects SAIL's liquidity to remain adequate. SAIL also has strong access to the Indian debt market. Leadership Position: SAIL is largest manufacturer of steel in India. This position is supported by its high level of vertical integration. The company supplies all its iron ore requirements and it meets about two-thirds of its power needs from its captive power plants. However, SAIL has limited coking coal integration and imports more than 80% of its requirements. SAIL's leadership is also supported by its established brand, country-wide sales network and presence in almost the entire range of low-carbon steel products. Government Linkages: SAIL's rating incorporate a one notch uplift on its stand-alone credit profile reflecting the moderate linkages with the state, India (BBB-/Stable), in line with Fitch's Parent and Subsidiary Rating Linkage methodology. The state owns 75% of SAIL's equity and retains significant control of the company. As one of seven state-owned entities granted Maharatna status by the government, SAIL enjoys significant operational and financial autonomy, including being able to decide on investment of up to INR50 billion, or 15% of its net worth, in a project. KEY ASSUMPTIONS Fitch's key assumptions within the rating case for SAIL include -- Indian steel demand growth of around 5% in FY17, which will accelerate to around 8% over the medium term, resulting in SAIL's sales volume increasing around 15% over the medium term -- Stable Indian steel prices around current levels supported by continuation of government measures to check significant rise in steel imports during FY17 -- Capex of around INR550 billion over the next two years with completion of expansion of the Bhilai steel plant during FY17 RATING SENSITIVITIES Positive: Future developments that may, individually or collectively, lead to the Outlook being revised to Stable include: -- Improvement in SAIL's financial performance, resulting in net leverage (net debt/ operating EBITDA) falling below 4.5x on a sustained basis Negative: Future developments that may, individually or collectively, lead to negative rating action include: -- SAIL's failure to demonstrate that it is on track to deleverage to below 4.5x on a sustained basis; -- Any significant weakening of linkages with the state. SUSHIL ANSAL: CRISIL Lowers Rating on INR248MM Term Loan to D ------------------------------------------------------------- CRISIL has downgraded its rating on the long-term bank facility of Sushil Ansal Foundation to 'CRISIL D' from 'CRISIL B-/Stable'. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Term Loan 248 CRISIL D (Downgraded from 'CRISIL B-/Stable') The rating downgrade reflects instances of delay by SAF in meeting its debt obligations; the delays have been caused due to cash flow mismatches and week liquidity. The rating reflects SAF's exposure to funding and implementation risks associated with its expansion into a private university, its limited track record of operations, and its weak financial risk profile, marked negative net cash accruals. These rating weaknesses are partially offset by the extensive experience of SAF's promoters in the education sector, the funding support it receives from them and the benefits expected from the healthy demand prospects for the education sector in India. SAF was established in December 2010. The trust is currently running AITM, located at Sushant Golf City, Lucknow; Sushant Golf City is a township being set up by a group company, Ansal Properties and Infrastructure Ltd. AITM offers several technical and management courses affiliated with the requisite authorities; it has a total intake capacity of 600 students. The trust is also in the process of expanding the infrastructure to set up a private university, Ansal University, in the same campus, for which the approvals are under process. TAGORE SHIKSHAN: CRISIL Assigns B+ Rating to INR99MM LT Loan ------------------------------------------------------------ CRISIL has assigned its 'CRISIL B+/Stable' rating to the long- term bank facilities of Tagore Shikshan Sansthan (TSS). Amount Facilities (INR Mln) Ratings ---------- --------- ------- Cash Credit/ Overdraft facility 31 CRISIL B+/Stable Long Term Loan 99 CRISIL B+/Stable The rating reflects the trust's moderate scale of operations, exposure to intense competition and to any unfavourable change in government regulations. These weaknesses are partially offset by the trustees' extensive experience in the education industry and the comfortable capital structure. Outlook: Stable CRISIL believes TSS will continue to benefit over the medium term from the trustees' extensive industry experience. The outlook may be revised to 'Positive' if the trust significantly increases revenue and profitability while maintaining its capital structure. Conversely, the outlook may be revised to 'Negative' if any large, debt-funded capital expenditure, or any unfavourable regulatory change weakens the financial risk profile. TSS was established in 1992. In 2001, the trust was taken over by the current trustees Mr. Narayan Ram, Mr. Rameshwaran Lal, and Mr. Hanuman Ram. The trust runs two educational institutes Tagore Shikshan Prashikshan Sansthan which offers B Ed courses and Tagore Shikshan Sansthan Senior Secondary School which offers secondary and senior secondary courses from classes 9 to 12; and one hostel named Tagore Shikshan Sansthan Samiti. The trust is located in Nagaur which is around 100 kilometres away from Jaipur, Rajasthan. The institutes have total student intake capacity of around 4500 currently. TAPAL STEEL: CRISIL Suspends 'D' Rating on INR100MM Cash Loan ------------------------------------------------------------- CRISIL has suspended its ratings on the bank facilities of Tapal Steel Private Limited (TSPL; part of the Venkateshwara group). Amount Facilities (INR Mln) Ratings ---------- --------- ------- Cash Credit 100 CRISIL D Letter of Credit 50 CRISIL D Term Loan 43 CRISIL D The suspension of ratings is on account of non-cooperation by TSPL with CRISIL's efforts to undertake a review of the ratings outstanding. Despite repeated requests by CRISIL, TSPL is yet to provide adequate information to enable CRISIL to assess TSPL's ability to service its debt. The suspension reflects CRISIL's inability to maintain a valid rating in the absence of adequate information. CRISIL considers information availability risk as a key factor in its rating process as outlined in its criteria 'Information Availability - a key risk factor in credit ratings' For arriving at the ratings, CRISIL has combined the business and financial risk profiles of TSPL and Shree Venkateshwara Sponge and Power Pvt Ltd (SVSPPL). This is because the two companies, together referred to as the Venkateshwara group, have operational and financial linkages (fund transactions) with each other. Promoted by Mr. Bhavani Prasad in 2005, the Venkateshwara group manufactures sponge iron and steel ingots. TSPL manufactures steel ingots and thermo-mechanically treated (TMT) bars whereas SVSPPL manufactures sponge iron. TARINI MOTORS: ICRA Reaffirms B+ Rating on INR3.25cr Cash Loan -------------------------------------------------------------- ICRA has re-affirmed the [ICRA]B+ rating of the INR3.25 crore (revised from 2.00 crore) cash credit limit and the INR1.74 crore (revised from INR2.09 crore) term loan facility of Tarini Motors Private Limited. ICRA has also re-affirmed the [ICRA]A4 rating of the INR2.50 crore short-term non-fund based bank limits of TMPL. The rating suspension of January 2016 has been revoked. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Fund Based Cash Credit 3.25 [ICRA]B+ re-affirmed Fund Based Term Loan 1.74 [ICRA]B+ re-affirmed Non-fund Based Bank Guarantee 2.50 [ICRA]A4 re-affirmed While re-affirming the ratings, ICRA has considered TMPL's weak financial profile characterized by high gearing level, depressed coverage indicators and a high working capital intensity of operation due to higher inventory holding requirements, which adversely impacts the liquidity position of the concern, as also reflected by high utilization of working capital limits. The ratings are also constrained by thin margins on the auto dealership business due to bargaining power and margins being controlled by MTBL, coupled with the intense competition from other OEM dealerships in the region, thereby limiting growth to an extent. The re-affirmation in ratings is, however, supported by the consistent increase in the operating income of the company. The established position of MTBL in the commercial vehicle segment and the diversified portfolio of the vehicles, ranging from LCVs to 49T tractor - trailers provide a cushion against business downturns in any single segment. Going forward, the company's ability to improve its working capital cycle, and consequently its cash flow position, through inventory management while increasing the scale of operations, will remain the key rating sensitivities. Tarini Motors Private Limited is engaged in the automobile dealership of commercial vehicle of Mahindra Truck and Buses Limited. The company operates through a single showroom at Keonjhar in Odisha, and deals in HCVs, MCVs and LCVs. In addition, it is engaged in servicing of vehicles and deals in spare parts, besides providing lathe service to vehicles. Recent Results TMPL reported a profit after tax (PAT) of INR0.33 crore in FY2015 on an operating income (OI) of INR24.33 crore, as against a PAT of INR0.31 crore on an OI of INR13.47 crore in FY2014. TATA STEEL: Fitch Cuts LT FC Issuer Default Rating to 'BB' ---------------------------------------------------------- Fitch Ratings has downgraded Tata Steel Limited's (TSL) Long-Term Foreign Currency Issuer Default Rating (IDR) to 'BB' from 'BB+/Stable' and placed it on Rating Watch Evolving (RWE). Unsecured notes issued by TSL have also been downgraded to 'BB' from 'BB+' and placed on RWE. The agency has also downgraded the Long-Term Foreign Currency IDR for TSL's wholly owned subsidiary, Tata Steel UK Holdings Limited (TSUKH), to 'B' from 'B+/Stable' and placed it on RWE. A full list of rating actions is provided at the end of this commentary. The downgrade reflects the decline in TSL's profitability and jump in leverage during the financial year ending 31 March 2016 (FY16), following challenging market conditions for its operations in India and overseas, especially in the UK. The downgrade in TSUKH reflects the downgrade of its parent, TSL, and the weak operating environment in the UK and more broadly across Europe. The RWE reflects uncertainty following TSL's announcement on 29 March 2016 that it is exploring all options for portfolio restructuring in Europe, including the potential divestment of its UK operations, in part or in whole. Considerable uncertainty remains on timing and how the group and its debt will be structured going forward. Fitch believes TSL's disposal of its UK operations, in part or whole, will result in a change to TSL's ratings. KEY RATING DRIVERS Weaker Profitability in India: Profitability of TSL's Indian operations has been impacted by weak steel price realisation in 9MFY16. Its consolidated EBITDA per ton declined to about INR7,400/tonne ($US110/t) in 9MFY16 from INR11,400/t in FY15, hit by a INR7,150/t fall in realisation. Steel producers globally are suffering from weak demand and overcapacity, with current global capacity utilisation at a low last seen during the 2008 global financial crisis. In India, demand growth was a tepid 4.7% in 9MFY16, which was met largely by a 29% yoy increase in imports. Recent actions by the Indian government, such as the imposition of a minimum import price following a 20% safeguard duty on imports to protect domestic manufacturers, have provided some relief, with domestic steel prices rising around INR4,000/t from January 2016 lows. However, prices are still about 20% lower than the average for FY15. Fitch says increased competition among domestic producers to support utilisation rates will likely constrain further price hikes in the near term, given domestic steel capacity is scheduled to jump about 15 million tonnes over 2H15 and 2016. European Operations Under Stress: TSL's overseas business reported EBITDA losses consecutively in 2Q and 3QFY16, hit by weak performance in the UK. Its operations in Europe and UK in particular, have faced poor steel-raw material spreads and relatively high operating costs. Price realisation in Europe has faced pressure from cheap Chinese and Russian imports amid weak regional demand. TSL has taken steps to cut costs, including shutting down its plates business in the UK and laying off around 3,000 employees. The company is also focusing on value-added products and profitable market segments, such as the automotive sector. Recognising the need for further action, TSL is now exploring the sale of its UK business, in part or whole. Jump in Leverage: Fitch estimates TSL's consolidated net debt to EBITDA leverage will jump to 11.6x in FY16, from 5.8x in the previous year, due to poor profitability. Leverage is likely to remain high at 8.2x in FY17 and 5.7x by FY18. Fitch's forecast assumes a gradual improvement in realisations and a return to profitability for overseas operations in FY18. However, further details on restructuring in Europe may change this forecast. Benefit From Greenfield Plant: TSL is currently commissioning the first phase of its greenfield plant at Kalinganagar in Odisha, India, with a capacity of 3 million tonnes per annum. TSL expects to gradually increase output in FY17. Apart from increased sales, TSL would benefit from improved product mix from the new plant, as the plant will specialise in producing high-grade flat products. It will also be one of the most cost-efficient plant in the country. The bulk of the capex has been completed and TSL should begin deriving cash-flow benefits in FY17. TSUKH Gains from TSL Support: TSUKH is unprofitable, with a weak standalone credit profile. The business continues to face weak local demand and high costs. However, TSUKH benefits from strategic ties with its parent, TSL, so its IDR includes a two- notch uplift in line with Fitch's Parent and Subsidiary Linkage methodology. Tata Group Support: TSL's ratings also benefit from a one-notch uplift because of potential support from the Tata Group due to the former's strategic importance to the group. KEY ASSUMPTIONS "Fitch's key assumptions within our rating case for the issuer include: -- Sales volume to decline 8% in FY17 due to lower steel production in the UK. Thereafter, volume assumed to grow by around 6% annually, with a ramp up of Indian capacity. -- Average sales realisation to improve 3% in FY17 and by 5% each over the next two years. -- Consolidated operating EBITDA margin to improve to 9% in FY17 then to 11% in FY18 (FY16: 6%). EBITDA per tonne would bounce back over FY17-18 to FY15 levels. -- Average annual capex of around INR70 billion from FY17." RATING SENSITIVITIES TSL The RWE will be resolved following a review of TSL's credit profile once Fitch has more clarity around the portfolio restructuring exercise in Europe. An upgrade is likely if the proceeds of potential asset sales are used to repay debt, reducing leverage. However, if leverage increases due to significant closure costs for the UK operations, Fitch will downgrade the rating. TSUKH The RWE will be resolved following a review of the linkages between TSUKH and TSL and TSUKH's credit profile, once Fitch has more clarity around the portfolio restructuring exercise in Europe. If Fitch concludes that the linkage is enhanced or TSUKH's standalone profile improves, an upgrade in likely. A downgrade is likely if Fitch views that the linkage has weakened. The full list of rating actions follows: TSL Long-Term Foreign Currency IDR downgraded to 'BB' from 'BB+'; placed on RWE Senior unsecured rating: downgraded to 'BB' from 'BB+' ; placed on RWE $US500 million 4.85% senior unsecured guaranteed notes due 2020 and $US1 billion 5.95% senior unsecured guaranteed notes due 2024 issued by ABJA Investments Co Pte Ltd, a wholly owned subsidiary of TSL: downgraded to 'BB' from 'BB+' ; placed on RWE TSUKH: Long-Term Foreign Currency IDR downgraded to 'B' from 'B+'; placed on RWE THE HIMANIS: CRISIL Assigns B+ Rating to INR50MM Term Loan ---------------------------------------------------------- CRISIL has assigned its 'CRISIL B+/Stable' rating to the long- term bank facility of The Himanis. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Term Loan 50 CRISIL B+/Stable The rating reflects the firm's exposure to project risk driven by high offtake risk, and intense competition in the hospitality industry. These rating weaknesses are partially offset by the extensive experience of promoter in the hospitality industry and his successful track record of operating other hotels. Outlook: Stable CRISIL believes The Himanis 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 earlier-than- expected ramp-up of operations resulting in higher-than-expected scale of operations and profitability, leading to considerable net cash accrual. Conversely, the outlook may be revised to 'Negative' if financial risk profile weakens on account of lower- than-expected revenue and profitability, or in case of a larger- than-expected, debt-funded capital expenditure, or if liquidity weakens significantly on account of an increase in working capital requirement. The Himanis was set up as a partnership firm in 2015 by Mr. Dinesh Gupta and his family. It is setting up a hotel-cum-resort of 60 rooms (including five cottages) in Kasauli, Himachal Pradesh which is expected to be completed by March 2017. UNITED NANOTECHNOLOGIES: ICRA Assigns B- Rating to INR3.02cr Loan ----------------------------------------------------------------- ICRA has assigned a long-term rating of [ICRA]B- to the INR5.72 crore2 fund based bank facilities and the INR0.03 crore unallocated limits of United Nanotechnologies Limited. ICRA has also assigned a short-term rating of [ICRA]A4 to the INR0.25 crore non-fund based facilities of UNL. The above unallocated limits of INR0.03 crore have also been rated at [ICRA]A4 on the short term scale. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Fund Based Limit Cash Credit 2.70 [ICRA]B- Assigned Fund Based Limit Term Loan 3.02 [ICRA]B- Assigned Non-fund Based Limit Bank Guarantee 0.25 [ICRA]A4 Assigned Unallocated Limits 0.03 [ICRA]B-/[ICRA]A4 Assigned The ratings assigned are constrained by UNL's lack of operational track record, high operating losses and low capacity utilization, which has kept business return indicators negative till FY2015. ICRA notes the high working capital intensity of business operations that adversely impacts the company's liquidity position. Given the nascent stage of operations and commencement of debt repayment obligations, the cash accruals from the business were insufficient to meet the contractual debt repayment necessitating promoter support to infuse funds in the business. ICRA also notes that the promoters infused around INR1.60 crore in the current fiscal year that has eased liquidity pressures to some extent. The ratings further take note of the weak financial profile of the company, characterized by negative net-worth and depressed debt coverage indicators as on March 31, 2015. The ongoing partly debt funded capital expenditure (capex) is likely to keep the gearing at elevated levels at least over the near term. The ratings also take into consideration the susceptibility of UNL's margins to fluctuations in raw material prices. The ratings, however, take cognizance of the prior experience of the promoters for over a decade in the manufacturing of similar products through group companies. ICRA also takes note of the gradual increase in production in the current year aided by steady orders from key customers and the ongoing expansion for product diversification, which is likely to result in a growth in top-line and profitability over the near to medium term. ICRA notes that the increasing capacity utilization of existing facility coupled with increased revenue from new products is likely to result in an increase in cash accruals. In ICRA's opinion, the ability of the company to successfully diversify its product profile and improve its scale of operations and profitability while managing its working capital requirements efficiently would be the key rating sensitivities going forward. Established in 2004, United Nanotechnologies Private Limited was taken over by the current management in 2013. The manufacturing operations of the company commenced from January 2014, and the constitution was changed from a private limited company to a limited company in March 2014. The company is engaged in manufacturing filler master batches and compounds. The manufacturing unit is located at Dhulagori in Howrah, West Bengal, with an installed annual capacity of 6,000 MT. Recent Results UNL reported a net loss of INR0.17 crore (provisional) in 9M FY2016 on an operating income (OI) of INR8.46 crore, as compared to a net loss of INR1.90 crore on an OI of INR5.70 crore during FY2015. VINIRRMAA PROJECTS: Ind-Ra Affirms IND B Long-Term Issuer Rating ---------------------------------------------------------------- India Ratings and Research (Ind-Ra) has affirmed Vinirrmaa Projects Pvt Ltd's (VPPL) Long-Term Issuer Rating at 'IND B'. The Outlook is Stable. A full list of rating actions is at the end of this commentary. KEY RATING DRIVERS The affirmation reflects VPPL's continued tight liquidity position as reflected in its multiple instances of overutilisation of the cash credit limit which ranges up to 19 days for the 12 months ended February 2016. The ratings remain constrained by the company's moderate credit metrics. In FY15 (year end March interest cover was 2.1x (FY14: 1.9x) and net financial leverage at 3.5x (3.5x). Operating EBITDA margins declined to 15.9% in FY15 (FY14: 17.9%) due to competitive bidding. The ratings continue to reflect the company's high order book concentration. Work orders from Bharat Coking Coal Ltd (a subsidiary of Coal India Ltd) continued to constitute around 88% of the total order book of INR2.49 billion at FYE15 (7x FY15 revenue). The ratings, however, are supported by VPPL's established operating track record and over 20 years of experience of its founders in civil contracting & construction business. RATING SENSITIVITIES Negative: A sustained worsening of liquidity impairing timely debt servicing could lead to a negative rating action. Positive: A sustained improvement in liquidity leading to an improvement in the ability to service debt in a timely manner could lead to a positive rating action. COMPANY PROFILE Established in 1999, VPPL executes engineering, procurement and construction contracts in the civil building and mining segments. 9MFY16 provisional financials indicate revenue of INR232.3 million, EBITDA margin of 14.3% and interest coverage of 1.9x. VPPL's ratings are as follows: -- Long-Term Issuer Rating: affirmed at 'IND B'/Stable -- INR80.0 million fund-based working capital limits: affirmed at 'IND B'/Stable/'IND A4' -- INR150.0 million non-fund-based working capital limits: affirmed at 'IND A4' VIVA VITA: CRISIL Suspends D Rating on INR50MM LT Loan ------------------------------------------------------ CRISIL has suspended its rating on the bank facilities of Viva Vita Diagnostic Systems Private Limited (VVDSPL). Amount Facilities (INR Mln) Ratings ---------- --------- ------- Cash Credit 6.7 CRISIL D Long Term Loan 50 CRISIL D Proposed Long Term Bank Loan Facility 23.3 CRISIL D The suspension of ratings is on account of non-cooperation by VVDSPL with CRISIL's efforts to undertake a review of the ratings outstanding. Despite repeated requests by CRISIL, VVDSPL is yet to provide adequate information to enable CRISIL to assess VVDSPL's ability to service its debt. The suspension reflects CRISIL's inability to maintain a valid rating in the absence of adequate information. CRISIL considers information availability risk as a key factor in its rating process as outlined in its criteria 'Information Availability - a key risk factor in credit ratings' VVDSPL, based in Chennai, provides various diagnostic services. The company's day-to-day operations are managed by Dr. D Geetanjali. VRIDHI IRON: Ind-Ra Assigns 'IND B+' Long-Term Issuer Rating ------------------------------------------------------------ India Ratings and Research (Ind-Ra) has assigned Vridhi Iron and Steels (VIS) a Long-Term Issuer Rating of 'IND B+'. The Outlook is Stable. A full list of rating actions is at the end of this commentary. KEY RATING DRIVERS VIS's ratings reflect its small scale of operations and moderate credit profile. In FY15, revenue was INR212.4 million, interest coverage (operating EBITDA/gross interest expenses) was 2.1x and net financial leverage (total adjusted net debt/operating EBITDAR) was 3.0x. The ratings also reflect VIS's partnership nature of business. The ratings also factor in the company's moderate liquidity profile with its 97.5% utilisation of the working capital facility for the 12 months ended February 2016. The ratings are supported by over a decade of experience of VIS's partners in the steel manufacturing business. The EBITDA margin of the entity is also satisfactory (FY15: 9.0%). RATING SENSITIVITIES Positive: A substantial improvement in the scale of operations and EBITDA margin along with an improvement in other credit metrics would be positive for the ratings. Negative:Further deterioration in overall credit metrics will be negative for ratings. COMPANY PROFILE VIS was incorporated in 2008 as a partnership firm. The registered office of the company is located in Guwahati, Assam. The company manufactures structural steel products. The entity started commercial operation in June 2012. VIS's ratings: -- Long-Term Issuer Rating: assigned 'IND B+'/Stable -- INR10.8 million long-term loan: assigned 'IND B+'/Stable -- INR43.0 million fund-based working capital limit: assigned 'IND B+'/Stable YASH BREEDING: ICRA Suspends 'B' Rating on INR10cr Bank Loan ------------------------------------------------------------ ICRA has suspended its long-term rating of [ICRA]B assigned to the INR10.0 crores bank facilities of Yash Breeding Farm. The suspension follows ICRA's inability to carry out a rating surveillance in absence of requisite information from the company. ================= I N D O N E S I A ================= ALAM SUTERA: Moody's Lowers CFR to B2; Outlook Stable ----------------------------------------------------- Moody's Investors Service has downgraded to B2 from B1 the corporate family rating of Alam Sutera Realty Tbk and the senior unsecured debt rating of Alam Synergy Pte. Ltd. Alam Synergy is a wholly-owned subsidiary of Alam Sutera and its debt is guaranteed by Alam Sutera and some of Alam Sutera's subsidiaries. The outlook for the ratings has been changed to stable from negative. List of affected ratings: Downgrades: Issuer: Alam Sutera Realty Tbk Corporate Family Rating, Downgraded to B2 from B1 Issuer: Alam Synergy Pte. Ltd. BACKED Senior Unsecured Regular Bond/Debenture, Downgraded to B2 from B1 Outlook Actions: Issuer: Alam Sutera Realty Tbk Outlook, Changed To Stable From Negative Issuer: Alam Synergy Pte. Ltd. Outlook, Changed To Stable From Negative RATINGS RATIONALE "The downgrades reflect the weak state of Alam Sutera's operating performance, led by a decline in its marketing sales for 2015, and delays in one-off transactions," says Jacintha Poh, a Moody's Vice President and Senior Analyst. These factors have in turn weakened the company's financial profile to a point outside its B1-rating parameters. For calendar 2015, Alam Sutera achieved only IDR1.9 trillion in marketing sales, equivalent to 43% of its revised target of IDR4.5 trillion, and representing a 55% year-on-year decline from the IDR4.2 trillion seen in 2014. The result in 2015 also represented its first deterioration in marketing sales over the last six financial years. Furthermore, two one-off transactions -- which were supposed to conclude in the first quarter of 2016 -- were either cancelled or delayed until mid-2016. In both cases, these outcomes are credit negative developments. Alam Sutera's strata-titled sale of The Tower -- an office building located in Jakarta's central business district -- to a single buyer was cancelled after the buyer failed to make payments. In addition, its joint venture with an Asian-based developer to co-develop a 20-hectare land parcel located at Alam Sutera township -- which includes an International Exhibition and Congress Center -- will likely be delayed until mid-2016. Given that the company generates little recurring income due to its limited number of investment properties, the decline in marketing sales will negatively affect its earnings, leading to weaker financial metrics. In 2015, Alam Sutera's revenue fell 23% year-on-year to IDR2.8 trillion from IDR3.6 trillion in 2014. Its key financial metrics, such as its leverage ratio -- as measured by revenue/adjusted debt and adjusted debt/EBITDA -- weakened to 37% from 53% in 2014 and 4.6x from 3.5x. And its interest coverage ratio -- as measured by homebuilding EBIT/interest expense -- weakened to 3.3x compared to 3.9x in 2014. "In addition, Moody's sees a high degree of uncertainty over Alam Sutera's ability to achieve its marketing sales for 2016. In this year, it targets to achieve IDR5 trillion, including IDR1.4 trillion from strata-titled office sales, which we view as optimistic, given the current soft demand for residential properties and oversupply of office spaces within Jakarta's CBD," adds Poh, who is also Moody's Lead Analyst for Alam Sutera and the Indonesian property sector as a whole. For the two months ended Feb. 29, 2016, the company achieved marketing sales of only IDR169 billion. Moody's will monitor the company's progress towards achieving a total marketing sales of at least IDR3 trillion in 2016, an amount which would keep the company's financial profile within the parameters of a B2 rating category. Nonetheless, Alam Sutera is expected to have an adequate liquidity position and is not faced with any near-term refinancing risk. Its next major debt maturity will only be in 2019. The first installment on its outstanding amortizing bank loans will start on Nov. 21, 2016, and Moody's expects that the payment can be met. The ratings are unlikely to be upgraded over the near term given weak marketing sales. However, upward pressure could build should Alam Sutera show progress in achieving marketing sales of at least IDR4 trillion in 2016 and demonstrates its ability to maintain a stable financial profile such that adjusted debt/EBITDA is below 3.5x and adjusted EBIT -- including capitalized interest -- /interest expense is above 3.0x. In particular, Moody's would look for Alam Sutera to maintain a strong liquidity position supported by long dated debt maturity profile. On the other hand, the ratings could be downgraded, if Alam Sutera's financial and liquidity profile weaken owing to: (1) the company's failure to execute its business plans, (2) a deterioration in the property market, leading to protracted weakness in its operations and credit profile, and (3) a material depreciation in the rupiah, which may increase the company's debt-servicing obligations. Moody's would also consider downgrading the ratings if the company: (1) fails to improve its weakening revenue/adjusted debt levels, (2) demonstrates an adjusted debt/EBITDA in excess of 5.0x, (3) exhibits an adjusted EBIT -- including capitalized interest -- /interest expense below 2.0x, and/or (4) shows insufficient cash to cover its short-term debt obligations. The principal methodology used in these ratings was Homebuilding And Property Development Industry published in April 2015. Established on 3 November 1993, Alam Sutera Realty Tbk is an integrated property developer in Indonesia, with a sizeable land bank of 2,375 hectares (gross area) as of Dec. 31, 2015. The company focuses on the sale of land lots in accordance with township planning requirements, as well as property development in residential, commercial and industrial segments in Indonesia. Alam Sutera -- which was formerly known as PT Adhihutama Manunggal -- was founded by the family of The Ning King and listed on the Indonesian Stock Exchange on Dec. 18, 2007. PERTAMINA ENERGI: Liquidation Set to be Complete in Mid-2016 ------------------------------------------------------------ The Jakarta Post reports that the liquidation of Pertamina Energi Trading Ltd (Petral) and its subsidiaries, which has been under way since February, is set to be complete by the middle of 2016. According to the report, Pertamina finance director Arief Budiman said two of Petral's entities in Hong Kong, Petral and Zambesi Investment Limited (ZIL) were already in the process of tax clearance from the Hong Kong tax authorities. "Then the companies will be dissolved," the report quotes Arief as saying at the press conference held in Jakarta on April 4. Meanwhile, the liquidation of Petral's subsidiary Pertamina Energy Services Pte Ltd (PES) awaited debt settlement in Singapore, he continued, the Post relays. "The final decision on the debt will involve the State-owned Enterprises Ministry," he said. The Post relates that Pertamina president director Dwi Soetjipto said the initial liquidation process was faster than expected. "After tax clearance from the Hong Kong tax authorities, ZIL and Petral will be dissolved and we expect it to be completed by the middle of this year. As for PES, it must solve its debt problems first, before the liquidation," Dwi, as cited by the Post, said. The report notes that the liquidation of Petral Group was among the recommendations issued by the reform team for the oil and gas sector, led by well-known economist Faisal Basri. The team was formed to study restrictive practices in Pertamina Group's oil and gas procurement process. According to the Post, the Energy and Mineral Resources Minister Sudirman Said explained that a so-called "oil mafia" had damaged Indonesia in two ways. First, it led Indonesia to fail to develop and build production facilities. With oil consumption of 1.5 million barrels per day (bpd), Indonesia only produced 800,000 bpd, the rest must be imported. "It was impossible for oil experts during the 1990s to not predict the increased oil consumption in the future. They were lobbied by the oil mafia not to build new refineries," he said, adding that the last oil refinery built in Indonesia was the Balongan refinery-built in 1991, the Post relays. Second, the mafia left Indonesia heavily dependent on fossil fuel and did not develop renewable energy. Sudirman also stated that Petral Group's liquidation was necessary as part of an efforts to improve Pertamina's supply chain management, and to complement the plan to reactivate Integrated Supply Chains (ISC), adds the Post. ========= J A P A N ========= ASAHI LIFE: Fitch Affirms 'BB+' Insurer Fin'l Strength Rating ------------------------------------------------------------- Fitch Ratings has affirmed Asahi Mutual Life Insurance Co.'s (Asahi Life) Insurer Financial Strength (IFS) Rating at 'BB+', with a Stable Outlook. KEY RATING DRIVERS The rating is based on Asahi Life's steadily improving capital adequacy and financial leverage as well as its resilient insurance underwriting, which are supported by a strategic focus on the profitable "third" (health) sector in recent years. Its statutory solvency margin ratio (SMR) remained adequate at 669.1% at end-December 2015 compared with 667.7% at end-March 2015. Its financial leverage also continued to be reasonable at 40.1% at end-December 2015 compared with 38.7% at end-March 2015. Nevertheless, Asahi Life's capital position is weaker than its peers' average SMR of more than 900%. In addition, Asahi Life's negative spread burden of JPY33.1 billion in the first half of the financial year ending March 2016 (1HFYE16) (1HFYE15: JPY35.9 billion) is large, and continues to offset gains from better- than-projected mortality and morbidity rates. However, Fitch expects Asahi Life's negative spread burden to gradually shrink due to declining average guaranteed yields over the medium term. The underwriting business has been stable due to an effective focus on the third sector. The core profit margin remained adequate at 6.1% in April to December 2015 from 5.0% a year earlier. Annual premiums of in-force policies in this segment increased by 3.2% in April to December 2015, due partly to effective sales promotions via non-traditional channels. Fitch believes that efforts in marketing third-sector products via several non-traditional channels, such as telephone marketing, are likely to further strengthen this segment. RATING SENSITIVITIES Key rating triggers for an upgrade would include: a further strengthening of capitalisation, and a decline in financial leverage to below 35%, on a sustained basis. Growth in the third- sector business and reduction in the surrender and lapse rates of the death-protection products would also be viewed positively by Fitch. Key rating triggers for a downgrade would include: a major erosion of capitalisation, or increase in financial leverage to above 45%. Significant deterioration in profitability such as the core profit margin to below 5%, on a sustained basis, would also put the rating under pressure. ==================== N E W Z E A L A N D ==================== STONEWOOD HOMES: New Owner Seeks Legal Advice Over Contracts ------------------------------------------------------------ Stuff.co.nz reports that Stonewood Homes' new owner is seeking urgent legal advice over the franchisee contract confusion. A number of customers from failed Stonewood Home franchisees have been left in limbo waiting to hear who will finish building their homes, Stuff.co.nz relates. According to the report, contracts that were held by those failed franchisees were transferred to Stonewood Homes New Zealand Ltd - - the master franchisor of the Stonewood Group -- and sister companies Stonewood Homes and Sterling Homes (Christchurch). However, when Stonewood New Zealand was placed into receivership the franchise customers were left in limbo. Inno Capital, a company owned by brothers Michael and John Chow and finance specialist Clint Webber, bought the company in March, the report notes. Stuff.co.nz says franchise contracts involving the Stonewood Homes NZ founder Brent Mettrick were terminated, sparking confusion around what company was responsible for those contracts. "We are taking legal advice on the matter as it is quite a unique circumstance in that Stonewood NZ did take over the right to complete on the liquidation of theses franchisees but the contracts did not anticipate the subsequent insolvency of Stonewood NZ," the report quotes Mr. Webber as saying. "The ownership interest of Mr Mettrick in these franchisees further complicates the issue. Before we proceed to complete any of the affected builds we need to ensure we have the legal capacity to do so and we have sought an urgent legal opinion on this." The Stonewood Homes franchise was established in 1987 by Brent and Sue Mettrick with 21 franchise across New Zealand. ================= S I N G A P O R E ================= S TRAVEL: Tour Operator Shuts Down Unexpectedly ----------------------------------------------- TODAY reports that a Singapore-based Korea tour operator has abruptly shut down, with a notice on its door advising affected customers to contact their insurers or the Small Claims Tribunal. S Travel had "unexpectedly ceased operations", said the National Association of Travel Agents Singapore (NATAS) on April 1. S Travel was a member of the association, the report notes. When TODAY visited its outlet, a notice on its door said the agency had "ceased operation(s) with immediate effect due to unforeseen circumstances". According to the report, the notice was put up since March 31, said the Singapore Tourism Board (STB), which has served a notice to S Travel to revoke its travel agent licence. TODAY relates that the STB said in a statement it is looking into the matter and may consider taking further actions against S Travel and its directors, if necessary. S Travel will be given until April 21 to provide reasons against the revocation of its licence, otherwise the revocation will take effect unless an appeal is submitted to the Ministry of Trade and Industry, the report notes. STB advised affected consumers to S Travel regarding the status of their booking or refund. If S Travel cannot be reached or fails to provide relevant service delivery or refund, consumers with applicable travel insurance are advised to approach their insurance providers. Consumers who are not covered by travel insurance can approach the Consumers Association of Singapore or the Small Claims Tribunal, where appropriate, said the STB. Several NATAS member agencies have offered to help affected customers. They are Air Sino-Euro Associates Travel (ASA Tours), Citystate Travel, Scenic Travel and UOB Travel Planners. However, they will not be taking over the bookings without payment. The agencies will instead offer discounts to affected customers. Chan Brothers Travel, CTC Travel, Dynasty Travel and Hong Thai Travel have also "indicated their willingness to join this initiative", NATAS, as cited by TODAY, said. ============= V I E T N A M ============= VIETNAM BANK: Fitch Affirms 'B+' Long-Term Issuer Default Ratings ----------------------------------------------------------------- Fitch Ratings has affirmed the Long-Term Issuer Default Ratings (IDRs) on five Vietnamese banks as follows: -- Vietnam Bank for Agriculture and Rural Development (Agribank), Vietnam Joint Stock Commercial Bank for Industry and Trade (Vietinbank) and Joint Stock Commercial Bank for Foreign Trade of Vietnam's (Vietcombank) were affirmed at 'B+' -- Asia Commercial Joint Stock Bank (Vietnam) (ACB) and Military Commercial Joint Stock Bank (Military Bank) were affirmed at 'B' All of them have Stable Outlooks. A full list of the ratings is at the end of this commentary. "The ratings were affirmed because the banking sector is showing initial signs of stabilisation, aided by an improving economy. We expect funding and liquidity conditions for the sector to remain steady, aided by a relatively stable currency and benign inflation. If sustained, this is likely to alleviate asset- quality pressures on the system. However, we expect banks' profitability to still remain under pressure due to weak net interest margins and high credit costs on more stringent asset classification." The understatement of problem loans seen in the low reported-NPL ratios across the system suggests that the capitalisation of banks is likely to be weaker than their reported capital ratios. KEY RATING DRIVERS IDRS, SENIOR DEBT, SUPPORT RATINGS (SRS) AND SUPPORT RATING FLOORS (SRFS) OF AGRIBANK, VIETINBANK AND VIETCOMBANK The Long-Term IDRs of Agribank, Vietinbank and Vietcombank are driven by Fitch's expectation that the government would provide extraordinary support as these entities are systemically important and majority-owned by the Vietnamese government. They are among the top four Vietnamese banks by assets and have strong domestic franchises. The banks' SRFs and IDRs are one notch lower than Vietnam's sovereign rating (BB-/Stable). Fitch believes the large size of the banking industry relative to GDP, and the government's weak finances may constrain the timeliness of support. Vietinbank's senior notes are rated at the same level as its Long-Term IDR, given that the notes constitute direct, unsubordinated and senior unsecured obligations of the bank, and rank equally with other unsecured and unsubordinated obligations. The Recovery Rating of 'RR4' reflects average recovery prospects. The Stable Outlooks on Agribank, Vietinbank and Vietcombank reflect the Stable Outlook on Vietnam's sovereign rating. VRS OF VIETINBANK AND VIETCOMBANK The VRs of Vietinbank and Vietcombank reflect their weak credit metrics, characterised by weak asset quality and capitalisation, declining profitability and high loan concentration risk, especially in state-owned enterprises (SOEs). The VRs also incorporate their strong domestic franchises, which focus on commercial and corporate lending, and their stable funding profiles. Fitch believes these two state-owned banks have an advantage over private banks in times of stress as depositors would likely have higher confidence in a majority state-owned bank. Vietinbank's loan-to-deposit ratio of 107% at end-June 2015, as per Fitch's estimate, exceeds the 90% soft limit imposed by the State Bank of Vietnam on state-owned banks. In contrast, Vietcombank's 74% is lower. Fitch does not assign a VR to wholly government-owned Agribank. Providing support to the domestic economy has a high influence on its standalone profile and makes it likely that it will continue to benefit from regulatory forbearance. IDRS AND VRS OF ACB AND MILITARY BANK The Long-Term IDRs of ACB and Military Bank are driven by their VRs and reflect their smaller franchises but modestly better loan quality compared to state-owned banks'. Fitch believes that their capital encumbrance from the underreporting of NPLs is lower compared with the state-owned banks. ACB's ratings reflect its stable credit profile given its more moderate annual loan growth in the last three years and smaller exposure to SOEs. ACB's loan quality is likely to be better compared with most of its peers given its much lower loan concentration risk with small exposure to SOEs - 1.2% of total loans at end-June 2015. The reported NPL ratio was 1.7% at end- June 2015 (2014: 2.2%). Military Bank's ratings reflect its franchise as one of the largest private banks in Vietnam. Fitch expects that the bank will continue to generate stronger profitability than its peers, supported by its higher net interest margins and more favourable cost structure. Its recent new share issuance has also helped maintain its capitalisation ratio above the majority of its local peers'. The ratings also take into account the bank's above- industry loan growth, its better liquidity profile - with loan- to-deposit ratio of 64% at end-June 2015 - and its strong government ties. The Stable Outlooks on ACB and Military Bank reflect Fitch's expectation that their risk profiles will be maintained over the near to medium term amid macroeconomic stability in Vietnam. SRS AND SRFS OF ACB AND MILITARY BANK The '5' SRs and 'No Floor' SRFs of ACB and Military Bank reflect Fitch's view that state support may be possible but cannot be relied upon. RATING SENSITIVITIES IDRS, SRS and SRFS OF AGRIBANK, VIETINBANK, VIETCOMBANK, ACB AND MILITARY BANK The Long-Term IDRs, SRs and SRFs of Agribank, Vietinbank and Vietcombank are sensitive to shifts in the sovereign's creditworthiness and ratings. These ratings may also be affected by any perceived change in the government's propensity to support the banks, although such a scenario is unlikely in the near term for the systemically important state-owned banks like Agribank, Vietinbank and Vietcombank. The SRs and SRFs for ACB and Military Bank are already at the lowest end of the ratings scale. The Long-Term IDRs of ACB and Military Bank are sensitive to changes in their VRs. SENIOR UNSECURED NOTES The ratings on Vietinbank's senior unsecured notes are sensitive to any changes in the bank's Long-Term IDR. The Recovery Rating is sensitive to Fitch's assessment of potential recoveries for creditors in case of default/non- performance. VRS OF VIETINBANK, VIETCOMBANK, ACB AND MILITARY BANK Vietnamese banks may be pressured if asset quality deteriorates further and if problem loan recognition were to accelerate, in turn significantly weakening banks' profitability and capitalisation. Downward pressure for Vietinbank may be higher given its low and declining capital ratio and higher loan concentration risk. Negative rating action for Vietinbank, Vietcombank, ACB and Military Bank may also result from increasing risk appetite, which may be demonstrated by excessive loan growth, or event risks such as M&A or operational lapses that could materially affect the banks' credit profiles. The VRs may be upgraded if structural issues such as lack of uniformity in loan classification standards and bad debt resolution are more adequately addressed, leading to greater transparency and sustainable improvement in the banks' asset quality and their overall financial profiles. The full list of rating actions is as follows: Agribank Long-Term IDR affirmed at 'B+'; Outlook Stable Short-Term IDR affirmed at 'B' Support Rating Floor affirmed at 'B+' Support Rating affirmed at '4' Vietinbank Long- Term IDR affirmed at 'B+'; Outlook Stable Short-Term IDR affirmed at 'B' Viability Rating affirmed at 'b-' Support Rating Floor affirmed at 'B+' Support Rating affirmed at '4' $US250m 8% notes due 2017 affirmed at 'B+'; Recovery Rating of 'RR4' Vietcombank Long-Term IDR affirmed at 'B+', Outlook Stable Short-Term IDR affirmed at 'B' Viability Rating affirmed at 'b-' Support Rating Floor affirmed at 'B+' Support Rating affirmed at '4' Military Bank Long-Term IDR affirmed at 'B'; Outlook Stable Short-Term IDR affirmed at 'B' Viability Rating affirmed at 'b' Support Rating Floor affirmed at 'No Floor' Support Rating affirmed at '5' ACB Long-Term IDR affirmed at 'B'; Outlook Stable Short-Term IDR affirmed at 'B' Viability Rating affirmed at 'b' Support Rating Floor affirmed at 'No Floor' Support Rating affirmed at '5' * VIETNAM: 2,900 Firms Close Down in Q1 --------------------------------------- Viet Nam News reports that the shortage of long-term capital coupled with low competitiveness should be blamed for the rising number of firms going bankrupt and temporarily halting operations in the first quarter of 2016. According to the report, Tran Hoang Ngan, a member of HCM City National Assembly Delegation, said there were increases in new firms and shut-downs, reflecting a trend of firms being founded for seasonal business rather than for long-term investment. Viet Nam News relates that the General Statistics Office (GSO) revealed that the number of firms closing down reached more than 2,900 in the first quarter of this year, representing a rise of 13.8%over the same period last year. Of note, 93% of them were small enterprises with registered capital below VND10 billion (US$446,500). The report says struggling firms that were forced to temporarily halt operations in the quarter totaled more than 20,000, rising by 23.9% against the same period. Ngan said the shortage of long-term stable capital makes it difficult for firms to survive for long periods, according to the report. He pointed out that many firms did not dare to invest in technology and equipment due to the shortage of capital and unstable borrowing interest rates, the report relates. "Interest rates must be kept stable. If rates rise, firms will barely survive," he said. Viet Nam News relates that Cao Si Kiem, president of the Viet Nam Association of Small and Medium Sized Enterprises, said it was important to improve the health of businesses with strengths based on technology and high-quality resources. Kiem said local firms must reduce their dependence on imported raw materials while paying attention to improving their technology and quality of human resources to enhance their competitiveness in this era of rapid global integration, the report relays. On the plus side, in the first quarter of this year, more than 23,700 firms were founded with total registered capital of VND186 trillion, a rise of 24.8% and 67.2% over the same period last year, respectively, adds Viet Nam News. ********* Tuesday's edition of the TCR-AP delivers a list of indicative prices for bond issues that reportedly trade well below par. Prices are obtained by TCR-AP editors from a variety of outside sources during the prior week we think are reliable. Those sources may not, however, be complete or accurate. The Tuesday Bond Pricing table is compiled on the Friday prior to publication. Prices reported are not intended to reflect actual trades. Prices for actual trades are probably different. Our objective is to share information, not make markets in publicly traded securities. Nothing in the TCR-AP constitutes an offer or solicitation to buy or sell any security of any kind. It is likely that some entity affiliated with a TCR-AP editor holds some position in the issuers' public debt and equity securities about which we report. A list of Meetings, Conferences and Seminars appears in each Wednesday's edition of the TCR-AP. Submissions about insolvency- related conferences are encouraged. Send announcements to conferences@bankrupt.com Friday's edition of the TCR-AP features a list of companies with insolvent balance sheets obtained by our editors based on the latest balance sheets publicly available a day prior to publication. At first glance, this list may look like the definitive compilation of stocks that are ideal to sell short. Don't be fooled. Assets, for example, reported at historical cost net of depreciation may understate the true value of a firm's assets. A company may establish reserves on its balance sheet for liabilities that may never materialize. The prices at which equity securities trade in public market are determined by more than a balance sheet solvency test. ********* S U B S C R I P T I O N I N F O R M A T I O N Troubled Company Reporter-Asia Pacific is a daily newsletter co- published by Bankruptcy Creditors' Service, Inc., Fairless Hills, Pennsylvania, USA, and Beard Group, Inc., Washington, D.C., USA. Valerie U. Pascual, Marites O. Claro, Joy A. Agravante, Rousel Elaine T. Fernandez, Julie Anne L. Toledo, and Peter A. Chapman, Editors. Copyright 2016. All rights reserved. ISSN: 1520-9482. This material is copyrighted and any commercial use, resale or publication in any form (including e-mail forwarding, electronic re-mailing and photocopying) is strictly prohibited without prior written permission of the publishers. Information contained herein is obtained from sources believed to be reliable, but is not guaranteed. TCR-AP subscription rate is US$775 for 6 months delivered via e- mail. Additional e-mail subscriptions for members of the same firm for the term of the initial subscription or balance thereof are US$25 each. For subscription information, contact Peter Chapman at 215-945-7000 or Nina Novak at 202-362-8552. *** End of Transmission ***