/raid1/www/Hosts/bankrupt/TCRAP

/raid1/www/Hosts/bankrupt/TCRAP_Public/160707.mbx T R O U B L E D C O M P A N Y R E P O R T E R A S I A P A C I F I C Thursday, July 7, 2016, Vol. 19, No. 133 Headlines A U S T R A L I A A & L EXCAVATIONS: First Creditors' Meeting Set For July 13 BENSIMON RETAIL: Collapses Into Liquidation KI RECRUITMENT: First Creditors' Meeting Slated For July 14 KLEEN GROUP: First Creditors' Meeting Slated For July 13 SMASH TECH: First Creditors' Meeting Scheduled For July 13 XCGV SERVICES: Goes into Voluntary Administration C H I N A CAR INC.: Fitch Lowers Long-Term Issuer Default Rating to 'BB' WEST CHINA CEMENT: Fitch Downgrades Long-Term IDR to 'B+' H O N G K O N G CHINA FISHERY: Fitch Cuts Issuer Default Rating to 'D' KAISA GROUP: Hong Kong Proceeding Granted Recognition KAISA GROUP: Recognition of Hong Kong Scheme Sought I N D I A ADITYA ULTRA: ICRA Lowers Rating on INR8cr Cash Loan to 'D' AKKAVILA K: ICRA Suspends 'B' Rating on INR3.5cr Term Loan ANUBHAV GEMS: ICRA Reaffirms B+ Rating on INR7.50cr Loan AVNI STEELS: ICRA Suspends 'B' Rating on INR5.95cr Loan BESTO MINING: ICRA Reaffirms 'B' Rating on INR18.14cr LT Loan CAPITAL STEEL: ICRA Lowers Rating on INR7cr Cash Loan to B+ CHANDAK MINING: ICRA Suspends 'B' Rating on INR9cr Loan CHINTAMANI COMMODITIES: ICRA Suspends D Rating on INR9.06cr Loan CIVITECH DEVELOPERS: ICRA Suspends B+ Rating on INR0.62cr Loan GEETHA TIMBER: ICRA Suspends 'B' Rating on INR2.27cr Loan HEM RAJ: ICRA Suspends 'B' Rating on INR45cr Bank Loan INDIABULLS REAL: S&P Affirms Then Withdraws 'B+' CCR INDIAN BANK: Fitch Affirms Long-Term IDR at 'BB+' JAIGO AGRO: ICRA Assigns B+ Rating to INR10cr Cash Credit KALINDI ISPAT: Ind-Ra Assigns 'IND BB-' Long-Term Issuer Rating KESAR IMPEX: ICRA Suspends 'B' Rating on INR9.0cr Cash Loan KINGFISHER: SBI Had Offered to Settle Loan Issue With Mallya KUBER FOODS: ICRA Suspends 'B' Rating on INR10cr Fund Based Loan L7H LIFE: ICRA Downgrades Rating on INR8.61cr LT Loan to 'D' LORDS MARK: Ind-Ra Assigns 'IND BB+' Long-Term Issuer Rating MANIKANTA CONSTRUCTIONS: ICRA Suspends B+ Rating on INR3cr Loan MONOPOLY YARNS: ICRA Revises Rating on INR4.39cr Loan to B- MONTFORT EDUCATIONAL: ICRA Assigns 'B' Rating to INR3.30cr Loan MOULI SPINNER: ICRA Suspends B+/A4 Rating on INR15cr Bank Loan NARULA EXPORTS: ICRA Suspends B+/A4 Rating on INR8cr Loan NITESH RESIDENCY: ICRA Suspends B+ Rating on INR312.50cr Loan P.A.S. COTTON: ICRA Suspends D Rating on INR6.89cr Term Loan PREMIER STEELS: ICRA Suspends B+ Rating on INR10cr LT Loan PSK DEVELOPERS: Ind-Ra Cuts Long-Term Issuer Rating to 'IND B+' QUAIL CV: Ind-Ra Assigns 'IND B+(SO)' Rating to Series A3 PTCs RAJNISH STEELS: ICRA Reaffirms B+ Rating on INR8.0cr LT Loan RAJU SPINNING: ICRA Suspends 'D' Rating on INR13.56cr Loan RAMANJANEYA MODERN: ICRA Suspends B+ Rating on INR5.0cr Loan SAHITYA SADAWART: ICRA Suspends D Rating on INR11.40cr Bank Loan SEEMA OIL: ICRA Suspends B+/A4 Rating on INR15cr Bank Loan SHARMA BROTHERS: ICRA Suspends B+ Rating on INR6.04cr Loan SHRI AGRAWAL: ICRA Reaffirms B+ Rating on INR21cr LT Loan SHRI MAHAVIR: ICRA Suspends 'B' Rating on INR8.0cr Bank Loan SHRI VASANTHRAJ: ICRA Assigns 'D' Rating to INR3.0cr LT Loan SIPAI COTTON: ICRA Suspends B+ Rating on INR6cr Cash Loan SPRINGBOARD ENTERPRISES: ICRA Suspends B Rating on INR6cr Loan SRI KARUNAMBIKAI: ICRA Suspends B Rating on INR20.3cr Term Loan TRISHLA BUILDTECH: ICRA Suspends 'B' Rating on INR34cr Loan TRIVENI SILK: ICRA Suspends B+ Rating on INR10.50cr Bank Loan TURBO TECH: ICRA Suspends B- Rating on INR4cr Loan V.P.S. TEXTILES: ICRA Assigns 'D' Rating to INR4.46cr Loan VIRENDER SINGH: ICRA Suspends B+ Rating on INR7.0cr Bank Loan WEBFIL LIMITED: ICRA Reaffirms 'C+' Rating on INR3.38cr Loan N E W Z E A L A N D POSTIE PLUS: Liquidator Cuts NZ$550K Deal With Former Supplier S O U T H K O R E A DOOSAN BOBCAT: Moody's Assigns B1 CFR; Outlook Stable - - - - - ================= A U S T R A L I A ================= A & L EXCAVATIONS: First Creditors' Meeting Set For July 13 ----------------------------------------------------------- Gavin Moss & James Stuart McPherson of Chifley Advisory Pty Ltd were appointed as administrators of A & L Excavations Pty. Ltd. on July 2, 2016. A first meeting of the creditors of the Company will be held at the boardroom of Servcorp, Level 27, Santos Place, 32 Turbot Street, in Brisbane, Queensland, on July 13, 2016, at 12:00 p.m. BENSIMON RETAIL: Collapses Into Liquidation ------------------------------------------- SmartCompany reports that luxury jewellery retailer Bensimon has collapsed into liquidation, with reported debts totaling close to AUD7 million. Bensimon Retail Group operates the Bensimon Diamonds retail outlet in Melbourne's Crown Casino, as well as an online retail business. Its related company, RR Fine Jewels, trades as Elizabeth Fine Jewellery on Elizabeth Street in the Melbourne CBD. SmartCompany relates that the businesses entered voluntary administration at the end of May and according to records from the Australian Securities and Investments Commission, a resolution to wind-up the companies was passed at a second meeting of creditors on July 1. Three companies -- Bensimon Retail Group Pty Ltd, Bensimon Pty Ltd and RR Fine Jewels -- are now in liquidation, with Gary Fettes and Shane Cremin of Rodgers Reidy managing the liquidation, according to SmartCompany. Jeweller Magazine, which has seen a report from the voluntary administration, said each of the businesses owes substantial debts to unsecured creditors: Bensimon Retail Group owes more then AUD2.5 million, RR Fine Jewels owes over AUD4 million and Bensimon owes more than AUD250,000, SmartCompany relays. The three companies also reportedly owe more than AUD2 million to trade creditors and AUD300,000 to the Australian Tax Office, while Crown Melbourne is owed close to AUD30,000 in rent for the retail store for April and May, SmartCompany adds. Jeweller Magazine reported that the failure of the business has been attributed to poor sales and the repayment of a loan to a former director, along with the withdrawal of working capital from the businesses and "poor or inadequate" management, according to SmartCompany. Liquidator Shane Cremin confirmed to SmartCompany on July 6 the businesses are continuing to trade while the liquidators continue to work towards selling the businesses. SmartCompany relates that Mr. Cremin said the liquidators have had interest from a potential buyer for the Bensimon Diamonds store at Crown Casino, which employs five people. KI RECRUITMENT: First Creditors' Meeting Slated For July 14 ----------------------------------------------------------- Jeremy Joseph Nipps and Glenn Spooner of Cor Cordis were appointed as administrators of KI Recruitment Pty Ltd on July 4, 2016. A first meeting of the creditors of the Company will be held at The Conference Room, BGC Centre, Plaza Level, 28 The Esplanade, in Perth, on July 14, 2016, at 10:00 a.m. KLEEN GROUP: First Creditors' Meeting Slated For July 13 -------------------------------------------------------- Amanda Young of Jirsch Sutherland was appointed as administrator of Kleen Group Pty Ltd on July 1, 2016. A first meeting of the creditors of the Company will be held at Level 27, 259 George Street, in Sydney, on July 13, 2016, at 10:00 a.m. SMASH TECH: First Creditors' Meeting Scheduled For July 13 ---------------------------------------------------------- Richard Albarran and Shahin Hussain of Hall Chadwick were appointed as administrators of Smash Tech 2 Pty Ltd, trading as Coomera Smash Repairs, on July 4, 2016. A first meeting of the creditors of the Company will be held at The Watermark Hotel 3032 Surfers Paradise Blvd, in Surfers Paradise, Queensland, on July 13, 2016, at 10:00 a.m. XCGV SERVICES: Goes into Voluntary Administration ------------------------------------------------- Cliff Sanderson at Dissolve.com.au reports that XCGV Services Pty Ltd, formerly known as Wardy IT Services, has gone into voluntary administration. Jonathan Paul McLeod from McLeod and Partners was appointed administrator of the company on June 23, 2016, the report discloses. The IT service provider was set up in June 2011. According to sources, the entrance of the company into administration is part of its ongoing corporate restructure efforts, Dissolve.com.au relays. The company reportedly gained AUD8.4 million of revenue in June 2015 which was a 30% increase in revenue compared to the previous year, Dissolve.com.au adds. ========= C H I N A ========= CAR INC.: Fitch Lowers Long-Term Issuer Default Rating to 'BB' -------------------------------------------------------------- Fitch Ratings has downgraded China-based rental auto group CAR Inc.'s (CAR) Long-Term Issuer Default Rating (IDR) and senior unsecured rating to 'BB' from 'BB+'. The Outlook is Negative. CAR's $US300 million 6% notes due 2021 and $US500 million 6.125% notes due 2020 have also been downgraded to 'BB' from 'BB+'. The downgrade reflects the substantial and growing related-party transactions with CAR's affiliate UCAR Inc, which has a weak credit profile. The Negative Outlook reflects the rapidly changing regulatory and market environment in the industries in which CAR and UCAR operate, and the risk that CAR's transactions with UCAR will remain high. KEY RATING DRIVERS Significant, Growing Related-Party Transactions: Related-party transactions between CAR and UCAR reached 33% of total revenue in 2015, and are poised to grow further in 2016. In addition to existing vehicle rentals to UCAR, CAR announced on 29 June 2016 that it will sell its used vehicles to UCAR and use UCAR's repair and maintenance services. CAR's largest shareholder is UCAR Cayman, and its largest customer is UCAR Inc, a ride-sharing company preparing to list on China's New Third Board. Charles Lu, who is currently chairman of CAR's board, is the actual controller of both UCAR Cayman and UCAR Inc. UCAR Raises Business Risk: UCAR China became CAR's largest customer in 2015, and accounted for more than one-third of rental revenue. At the same time, Fitch believes that UCAR's credit profile is weak: the company is a small #4 player in China's hyper-competitive and evolving ride-sharing industry, and has yet to break even on an EBITDA level. UCAR believes that regulatory developments in China may benefit UCAR's business-to-customer model, while the timing and details remain unclear. Fitch believes that there may be a major negative impact on CAR's operations if UCAR remains loss-making at the EBITDA level. Slower Car Rentals Business: Growth in the short-term rentals business began to slow down in 2015, as inexpensive rides offered by Didi and Uber began to lure customers away from traditional rental cars. Excluding UCAR's contribution, revenue from short- term car rentals grew only by the high single digits in 2015, compared with 30% in 2014. Management says it is planning to launch new marketing initiatives to attract and retain customers in 2016, and is targeting 20% revenue growth for the year. Fitch said, "Financial Profile Remains Healthy: Fitch expects the company to turn FCF positive after cutting back its fleet- expansion plans. Fitch expects a net fleet addition of only 7000- 8000 vehicles in 2016. We see FFO-adjusted net leverage peaking at 2.5x in 2016, and declining gradually over the next two to three years. CAR's liquidity is sufficient, as current cash and committed undrawn banking facilities are more than sufficient to cover its short-term obligations." Share Buybacks Credit Negative: CAR announced a share buyback plan in early June, and has already spent more than HKD300m between early June and early July 2016. If the company continues at the current pace, the share buybacks may more than cancel out the projected positive FCF for the year. If the company fully exercises its mandate to repurchase 10% of shares outstanding, Fitch estimates that the buybacks may cost up to HKD1.8billion in cash, based on the current share price. KEY ASSUMPTIONS -- Net rental fleet addition of 7,000 vehicles in 2016 -- Stable RevPac (average daily rental revenue per short-term rental vehicle) and utilisation rate of 63%-64% -- Flattish revenue contribution from UCAR -- EBITDA and EBIT margins maintained at 2015 levels -- CNY800 million cash outlay for share buybacks in 2016 -- No common dividends RATING SENSITIVITIES Negative: Developments that may, individually or collectively, lead to negative rating action include: -- Closer ties with UCAR, including (but not limited to) higher revenue contribution and higher share ownership -- FFO-adjusted net leverage sustained above 3.0x -- EBITDA margin sustained below 45% (FY15: 50.7%) -- EBIT margin sustained below 20% (FY15: 30.9%) -- Sustained negative FCF after share buybacks. Positive: Developments that may, individually or collectively, lead to the Outlook being revised to Stable include: -- UCAR generates sustained positive EBITDA -- Revenue contribution from UCAR sustained below 20%. WEST CHINA CEMENT: Fitch Downgrades Long-Term IDR to 'B+' --------------------------------------------------------- Fitch Ratings has downgraded West China Cement Limited's (WCC) Long-Term Issuer Default Rating and senior unsecured rating to 'B+' from 'BB-', and removed the Rating Watch Positive (RWP) on the ratings. The Outlook on the IDR is Stable. A full list of ratings is at the end of this commentary. The removal of the RWP follows the termination of Anhui Conch Cement Company Limited's (Conch; A-/Stable) plans to acquire a controlling stake in WCC. The downgrade is driven by WCC's increased leverage in the current weak operating environment. The Stable Outlook reflects Fitch's expectation that cement prices and volumes in WCC's key markets - and hence its financial performance - are unlikely to deteriorate. KEY RATING DRIVERS Acquisition by Conch Terminated: Conch and WCC jointly said on 30 June 2016 that Conch will not take a controlling stake in WCC as the parties did not obtain all necessary regulatory approvals by the targeted completion date. The transaction would have increased WCC's size as Conch would have injected four of its plants into WCC. Furthermore, as a subsidiary of a larger and financially stronger company, WCC would have been able to substantially lower its financial costs. Conch remains as the second-largest shareholder of WCC (owning 21.2%), but it is unclear what actions the two companies can take to improve WCC's business and financial profiles. Lower Profitability: Fitch said, "WCC's performance deteriorated in 2015 as a result of a sustained weakness in the cement market in Shaanxi, its main market. Gross profit/tonne (excluding depreciation) deteriorated to CNY68/tonne in 2015 from CNY69/ton and CNY72/ton in 2014 and 2013, respectively. We do not expect margins to improve meaningfully in the near term as prices continue to be weak. The average cement price in Shaanxi fell 2% in May 2016 from a year earlier. Higher Leverage: "WCC received CNY1.2billion from Conch's acquisition of a stake in 2015, but the company's FFO-adjusted net leverage increased to 4.0x in 2015 from 3.5x in 2014 due to lower profitability, high capex, and a longer cash cycle. We believe it would be hard for WCC to deleverage in the next three years given the low profitability." KEY ASSUMPTIONS Fitch's key assumptions within its rating case for the issuer include: -- WCC's market share remains stable in Shaanxi -- Average selling price to fall 2% in 2016 and remain unchanged in 2017 RATING SENSITIVITIES Positive: Future developments that may, individually or collectively, lead to positive rating action include: -- FFO-adjusted net leverage sustained below 3.5x -- Gross profit per tonne sustained above CNY70 -- Sustained positive FCF Negative: Future developments that may, individually or collectively, lead to negative rating action include: -- FFO-adjusted net leverage sustained above 4.5x -- Gross profit per tonne sustained below CNY50 FULL LIST OF RATINGS West China Cement Limited Long-Term IDR downgraded to 'B+' from 'BB-'; Outlook Stable; off RWP Senior unsecured rating downgraded to 'B+' from 'BB-'; Recovery Rating of 'RR4'; off RWP Rating on $US400m senior unsecured notes due 2019 downgraded to 'B+' from 'BB-'; Recovery Rating of 'RR4'; off RWP ================ H O N G K O N G ================ CHINA FISHERY: Fitch Cuts Issuer Default Rating to 'D' ------------------------------------------------------ Fitch Ratings has downgraded China Fishery Group Limited's (China Fishery) Issuer Default Rating to 'D' from 'RD'. No Outlook has been assigned. The downgrade follows China Fishery's announcement on 30 June that the company and its subsidiaries had filed for US bankruptcy protection under Chapter 15 and Chapter 11 of the US bankruptcy code. The bankruptcy filing with facilitate a debt restructuring arrangement with holders of the $US300m senior unsecured notes issued by CFG Investment S.A.C., China Fishery's financing vehicle. China Fishery failed to pay a coupon on the notes that was due on 30 January 2016. China Fishery's senior unsecured rating and the rating on the $US300m notes issued by CFG Investment S.A.C. have been affirmed at 'C', with a Recovery Rating of 'RR4'. RATING SENSITIVITIES Fitch will re-examine China Fishery's credit profile if it successfully restructures its debt. KAISA GROUP: Hong Kong Proceeding Granted Recognition ----------------------------------------------------- Judge Sean H. Lane of the U.S. Bankruptcy Court for the Southern District of New York issued an order recognizing the proceeding of Kaisa Group Holdings Ltd., pending before the High Court of Hong Kong Special Administrative Region, as a foreign main proceeding. Judge Lane also recognized Dr. Tam Lai Ling as the duly appointed authorized representative of Kaisa. Dr. Tam Lai Ling was authorized to operate Kaisa's business in relation to its chapter 15 case and was given authority to exercise the powers of a trustee. He was entrusted with the administration and realization of all of Kaisa's assets that are located in the territorial jurisdiction of the United States, including all claims and causes of action belonging to Kaisa. Judge Lane ordered all persons and entities that were given a notice of his Order and who are in possession, custody or control of property, or the proceeds thereof, of Kaisa located in the territorial jurisdiction of the United States to immediately Advise Dr. Tam Lai Ling by written notice sent to the following address: Suite 2001 20th Floor, Two International Finance Centre 8 Finance Street, Central, Hong Kong (Attn: Dr. Tam Lai Ling) Judge Lane further ordered that the written notice must set forth the following: (1) the nature of such property or proceeds; (2) when and how such property or proceeds came into the custody, possession and control of such person or entity; and (3) the full identity and contact information for such Person or entity. About Kaisa Group Kaisa Group Holdings Ltd. (HKG:1638) -- http://www.kaisagroup.com/english/-- is an investment holding company, and its subsidiaries are engaged in property development, property investment and property management. Shenzhen, China-based Kaisa became the first Chinese developer to default on dollar-denominated debt when it failed to pay the coupon on two securities earlier in 2014. In October 2015, the builder reached an agreement with Bank of China Ltd. that enabled it to restart sales of some projects. The company said its offshore debt restructuring plan was approved by requisite majority of creditors at scheme meetings held by courts in Hong Kong and the Cayman Islands on May 20, 2016. Kaisa said holders of 96 percent of its offshore obligations, which are from outside of China, support the restructuring agreement negotiated in the Hong Kong proceeding. Kaisa Group filed a Chapter 15 bankruptcy petition (Bankr. S.D.N.Y. Case No. 16-11303) in the U.S. on May 5, 2016, to seek recognition of its proceedings in Hong Kong. Dr. Tam Lai Ling, the foreign representative, signed the petition. Attorneys at Ropes & Gray LLP serve as counsel in the U.S. cases. Kaisa listed $14.9 billion in debt and $16.1 billion in assets. KAISA GROUP: Recognition of Hong Kong Scheme Sought --------------------------------------------------- Dr. Tam Lai Ling, foreign representative of the debtor Kaisa Group Holdings Ltd., asks the U.S. Bankruptcy Court for the Southern District of New York to recognize the terms of Kaisa's scheme of arrangement. "The Hong Kong Scheme provides for a restructuring in which Kaisa's creditors holding 'offshore' claims arising out of debt issued by non-PRC entities under non-PRC law the Scheme Claims will be restructured. The Scheme Claims consist of Existing HY Notes, Convertible Bonds, and Existing Offshore Loans... New York law governs both (i) the Existing HY Notes and (ii) an 'Intercreditor Agreement' providing that the holders of the Existing HY Notes, the Convertible Bonds and certain Existing Offshore Loans have equal priority in respect of, and a pro rata entitlement to, specified security interests," the Foreign Representative Contends. The Hong Kong Scheme contemplates a restructuring in which the Existing HY Notes, Convertible Bonds, and Existing Offshore Loans are combined into a single class for voting purposes, with each participating holder entitled to select among the following three options: (a) Option 1 - New HY Notes and CVRs: A combination of (i) new notes ("New HY Notes")30 issued at an exchange rate of 1:1 with new principal amounts, new maturity dates, and new interest coupon schedules; and (ii) contingent value rights ("CVRs"), providing upside sharing in the event that one or more specified trigger events occur. (b) Option 2 - New HY Notes Only: New HY Notes issued at an exchange rate of 1:1.02598 with new principal amounts, new maturity dates, and new interest coupon schedules; or (c) Option 3 - Mandatorily Exchangeable Bonds: New convertible bonds ("Mandatorily Exchangeable Bonds," and together with the New HY Notes and CVRs, the "Scheme Instruments") issued at an exchange rate of 1:1. The Foreign Representative tells the Court that the consummation of the Hong Kong Scheme and Scheme Releases will have, among others the following effects: (a) all Scheme Claims will be cancelled upon issuance of the Scheme Instruments; (b) Scheme Creditors will be deemed to have entered into, and be bound by, among others, the definitive restructuring agreements giving effect to the terms of the Hong Kong Scheme ("Restructuring Documents"); (c) Scheme Creditors holding Existing HY Notes, the Convertible Bonds and certain of the Existing Offshore Loans currently have the benefit of certain guarantees provided by some of Kaisa's subsidiaries ("Subsidiary Guarantors"). Those Scheme Creditors also separately have the benefit of certain share pledges which benefit is to be pari passu under the Intercreditor Agreement with, among others, Kaisa and certain of Kaisa's subsidiaries ("Subsidiary Guarantor Pledgors"). As part of the Hong Kong Scheme, each relevant trustee will enter into an "Amended and Restated Intercreditor Agreement," pursuant to which the security will be shared for the benefit of all Scheme Creditors on a pari passu basis; (d) the Scheme Claims will be released and discharged fully and absolutely upon the issuance of the Scheme Instruments; and (e) The Debtor and Debtor Related Parties shall also be released unconditionally from possible claims arising from the Scheme Claims ("Scheme Releases"). "Recognizing and enforcing the Hong Kong Scheme and the Hong Kong Sanction Order could thus not upset the principles of fairness under U.S. law and, indeed, would further the key policy considerations of comity and recognition of a foreign court's insolvency powers where procedural fairness is evident. In the absence of any public policy concerns, the Requested Relief must be granted on the basis of comity and Bankruptcy Code section 1509(b)(3)," the Foreign Representative avers. The Foreign Representative's Motion is scheduled for hearing on July 14, 2016 at 11:30 a.m. The deadline for the filing of objections to the Foreign Representative's Motion is set on July 8, 2016 at 5:00 p.m. Dr. Tam Lai Ling, Foreign Representative of Kaisa Group, is represented by: Mark I. Bane, Esq. ROPES & GRAY LLP 1211 Avenue of the Americas New York, NY 10036-8704 Telephone: (212)596-9000 Facsimile: (212)596-9090 E-mail: mark.bane@ropesgray.com - and - Joshua Y. Sturm, Esq. ROPES & GRAY LLP 800 Boylston Street Boston, MA 02199-3600 Telephone: (617)951-7000 Facsimile: (617)951-7050 E-mail: joshua.sturm@ropesgray.com About Kaisa Group Kaisa Group Holdings Ltd. (HKG:1638) -- http://www.kaisagroup.com/english/-- is an investment holding company, and its subsidiaries are engaged in property development, property investment and property management. Shenzhen, China-based Kaisa became the first Chinese developer to default on dollar-denominated debt when it failed to pay the coupon on two securities earlier in 2014. In October 2015, the builder reached an agreement with Bank of China Ltd. that enabled it to restart sales of some projects. The company said its offshore debt restructuring plan was approved by requisite majority of creditors at scheme meetings held by courts in Hong Kong and the Cayman Islands on May 20, 2016. Kaisa said holders of 96 percent of its offshore obligations, which are from outside of China, support the restructuring agreement negotiated in the Hong Kong proceeding. Kaisa Group filed a Chapter 15 bankruptcy petition (Bankr. S.D.N.Y. Case No. 16-11303) in the U.S. on May 5, 2016, to seek recognition of its proceedings in Hong Kong. Dr. Tam Lai Ling, the foreign representative, signed the petition. Attorneys at Ropes & Gray LLP serve as counsel in the U.S. cases. Kaisa listed $14.9 billion in debt and $16.1 billion in assets. ========= I N D I A ========= ADITYA ULTRA: ICRA Lowers Rating on INR8cr Cash Loan to 'D' ----------------------------------------------------------- ICRA has revised the long term rating assigned to the INR7.00 crore of term loan and INR8.00 crore cash credit limits of Aditya Ultra Steel Private Limited from [ICRA]C+ to [ICRA]D. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Term Loans 7.00 Revised to [ICRA]D from [ICRA]C+ Cash Credit 8.00 Revised to [ICRA]D from [ICRA]C+ The rating revision reflects delays in servicing debt obligations due to the stretched liquidity position of the company on account of low capacity utilization levels. Incorporated in July 2011, Aditya Ultra Steel Private Limited (AUSPL) is engaged in the business of manufacturing of TMT bars at its manufacturing facility located in Rajkot district of Gujarat having an installed capacity of 1,20,000 MTPA of TMT bars. The founder promoters of the company, namely Mr. Dipen Faldu, Mr. Chirag Lakhani and Mr. Bharat Pandey had sold the business and handed over management in 2014 to the seven new promoters. Further, in the current fiscal, the business was sold to Jain family consisting of Mr. Manoj Jain and his son Mr. Varun Jain. The Jain family has taken over the management of the company from May 2016 onwards. AKKAVILA K: ICRA Suspends 'B' Rating on INR3.5cr Term Loan ---------------------------------------------------------- ICRA has suspended the [ICRA]B rating assigned to the INR3.50 crore term loans, INR1.50 crore long term, fund-based facilities and INR1.14 crore proposed long term facilities of Akkavila K Lekshmanan & Co. 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. Akkavila K. Lekshmanan & Co (AKLC) was incorporated in December 2011 as a proprietorship concern by Mr. L. Saiju for the production of manufactured sand from crushed granite slabs. The promoter is a partner in another entity Akkavila Sajenan Aggregates, which has been engaged in the business of crushing granite slabs for over three decades. This plant was recently modernized and is located in proximity to AKLC, thereby easing operations of the sand manufacturing unit. The production operations of AKLC commenced in June 2013 and the day to day operations of the company is managed by the promoter Mr. L. Saiju. ANUBHAV GEMS: ICRA Reaffirms B+ Rating on INR7.50cr Loan -------------------------------------------------------- ICRA has reaffirmed its long term rating of [ICRA]B+ on the INR7.50 crore (enhanced from INR6.25 crore) fund-based bank limits of Anubhav Gems Private Limited. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Fund Based Limits 7.50 [ICRA]B+; reaffirmed ICRA's rating continues to draw comfort from the experience of promoters of AGPL with a well established track record in the gems and jewellery business. The rating also takes into account the company's healthy revenue growth in FY2015 backed by higher sales volumes and the equity infusion received resulting in increase in net worth in FY2016. The rating however remains constrained due to AGPL's presence in only the emerald trading business and its dependence primarily on one supplier resulting in limited control over availability, quality and price of gems. Further, AGPL's operations remain highly working capital intensive on account of the high inventory holding period due to bulk procurement. However, the same has witnessed an improvement over the last three years. Nevertheless, in the absence of any bank limit enhancement, the company's limit remains highly utilised. AGPL's financial risk profile remains moderate as reflected in high gearing levels with dependence on interest bearing unsecured loans and modest debt protection metrics. This apart the rating also factors in exposure of the company's profitability to the fluctuations in the exchange rates as it imports its entire raw material and does not follow a hedging mechanism. The company's ability to scale up its operations, improve its profit margins and debt coverage and manage its working capital requirements will remain the key rating sensitivities. Anubhav Gems Pvt. Ltd. was established in 2010 as a private limited company. The company is promoted by three brothers; Mr. Rizwan Ullah, Mr. Inam Ullah and Mr. Arifullah. It is engaged in cutting, polishing and finishing of emeralds and the manufacturing facility is in Jaipur. Recent Results For FY2015, the company reported a net profit of INR0.41 crore on an operating income of INR48.37 crore, as compared to a net profit of INR0.37 crore on an operating income of INR26.72 crore for the previous year. The company, on a provisional basis, reported a net profit of INR0.52 crore on an operating income of INR47.73 crore for FY2016. AVNI STEELS: ICRA Suspends 'B' Rating on INR5.95cr Loan ------------------------------------------------------- ICRA has suspended [ICRA]B rating assigned to the INR5.95 Crore fund based facilities of Avni Steels The suspension follows ICRA's inability to carry out a rating surveillance in the absence of the requisite information from the company. BESTO MINING: ICRA Reaffirms 'B' Rating on INR18.14cr LT Loan ------------------------------------------------------------- ICRA has reaffirmed the long term rating assigned to the INR18.14 crore (reduced from INR19.10) fund based limits of Besto Mining India Private Limited (BMIPL) at [ICRA]B. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long term Fund Based 18.14 [ICRA]B reaffirmed The rating reaffirmation takes into account the moderate scale of operations and the geographic concentration in and around Bangalore region, limiting operational and financial flexibility to an extent. The rating is constrained by the highly competitive and fragmented nature of the industry with large number of small and large players which puts pressure on the profitability of the company. ICRA notes that the installation of the plant facility has led to significant bank borrowings, resulting in sizable repayment obligations in the short to medium term, vis-a-vis, the scale of current operations and cash accruals. The rating, however, positively factors in the long track record of the promoter in the construction and mining industry and the relationship with builders and contractors which may aid in getting work orders. The rating also takes into account the improvement in the operating profile of the company in FY16 and the premium quality product portfolio including M-sand, plaster sand and aggregates, which aid in achieving above average realizations. ICRA takes note of the ease in raw material availability as the major raw material, granite, is available through quarries owned by the sister concern. Besto Mining (India) Private Ltd. (BMPL) was incorporated as a private concern by Mr. Roy Kurian, Mr. Alex PJ and Mr. Vincent Jospeh in 2014. The company produces M (Manufactured) Sand & Aggregate from its 5 stage 300 tons per day (tpd) plant located at Yalganhalli village in Chikballapur district (Bangalore). Recent Results During FY16 (provisional financials), the company reported a net profit of INR0.36 crore on an operating income of INR22.47 crore as against a net loss of INR1.58 crore on an operating income of INR0.11 crore during 1M FY15. CAPITAL STEEL: ICRA Lowers Rating on INR7cr Cash Loan to B+ ----------------------------------------------------------- ICRA has revised the long-term rating from [ICRA]BB to [ICRA]B+ assigned to the INR7.00 crore cash credit facility of Capital Steel Corporation (Prop. P. Rajesh Ship Breaking Private Limited). ICRA has reaffirmed the short term rating of [ICRA]A4 to the INR56.10 crore short term non fund based facilities of CSC. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Cash Credit 7.00 Revised from [ICRA]BB(Stable) to [ICRA]B+ Letter of Credit 55.00 [ICRA]A4 reaffirmed Credit Exposure Limit 1.10 [ICRA]A4 reaffirmed The revision in ratings reflects the significant de-growth in revenues of Capital Steel Corporation (CSC) in FY2015 and FY2016 following the slowdown in the ship-breaking industry and weak profitability and coverage indicators. The ratings further reflect the current challenging operating environment for the ship-breaking industry characterised by lower steel prices and increasing pressures from international competitors as well as from a large number of players operating in Alang. ICRA also notes that the company is exposed to any adverse movements in steel prices, foreign exchange rate fluctuations and the regulatory risks largely related to the environmental issues and any delays in obtaining requisite approvals. The ratings, however, positively factor in the extensive experience of the promoter of more than 25 years in the ship- breaking business and the expected revival of the ship-breaking industry following significant decline in ship procurement price and improvement in domestic steel prices, coupled with the imposition of Minimum Import Price (MIP). Incorporated in 1994, Capital Steel Corporation (Prop. P. Rajesh Ship Breaking Private Limited) (CSC) is a private limited company, which procures ships from the international market for ship-breaking and sells the scrap in the domestic market. CSC operates from Plot No. 84B at the Alang-Sosiya Ship-breaking Yard, Bhavnagar. Taken on lease, the area of the plot is 2,115 sq meters and can accommodate a vessel with a maximum width of around 35 metres. Recent Results During FY2015, the company reported an operating income of INR12.74 crore and profit after tax of INR0.42 crore as against the operating income of INR20.20 crore and profit after tax of INR1.26 crore during FY2014. Further during the first nine months of FY2016, the company reported an operating income of INR0.00 crore and net losses of INR0.04 crore (as per provisional unaudited financials). CHANDAK MINING: ICRA Suspends 'B' Rating on INR9cr Loan ------------------------------------------------------- ICRA has suspended [ICRA]B rating assigned to the INR9 Crore fund based facilities of Chandak Mining and Export. The suspension follows ICRA's inability to carry out a rating surveillance in the absence of the requisite information from the company. CHINTAMANI COMMODITIES: ICRA Suspends D Rating on INR9.06cr Loan ---------------------------------------------------------------- ICRA has suspended [ICRA]D rating assigned to the INR9.06 Crore fund based and non fund based facilities of Chintamani Commodities. The suspension follows ICRA's inability to carry out a rating surveillance in the absence of the requisite information from the company. CIVITECH DEVELOPERS: ICRA Suspends B+ Rating on INR0.62cr Loan -------------------------------------------------------------- ICRA has suspended the [ICRA] B+ rating for the INR0.62 crore bank facilities of Civitech Developers Private Limited. The suspension follows ICRA's inability to carry out a rating surveillance in the absence of the requisite information from the company. GEETHA TIMBER: ICRA Suspends 'B' Rating on INR2.27cr Loan --------------------------------------------------------- ICRA has suspended [ICRA]B ratings; assigned to the INR2.27 crore fund based facilities and the short term rating of [ICRA]A4 assigned to the INR12.70 crore short-term fund based facilities and INR12.70 crore sub limits of Geetha Timber. ICRA has also suspended the ratings of [ICRA]B/[ICRA]A4 to the INR0.03 crore long-term/short-term unallocated facility of the Firm. The suspension follows ICRA's inability to carry out a rating surveillance in the absence of the requisite information from the entity. 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. HEM RAJ: ICRA Suspends 'B' Rating on INR45cr Bank Loan ------------------------------------------------------ ICRA has suspended its long-term rating of [ICRA]B assigned to the INR45.00 crore bank facilities of Hem Raj Sohan Lal. The suspension follows ICRA's inability to carry out a rating surveillance in the absence of the requisite information from the company. INDIABULLS REAL: S&P Affirms Then Withdraws 'B+' CCR ---------------------------------------------------- S&P Global Ratings affirmed its 'B+' long-term corporate credit rating on Indiabulls Real Estate Ltd. (IBREL) with a stable outlook. S&P then withdrew the rating at the company's request. In addition, S&P affirmed and then withdraw the 'B+' long-term foreign currency issue rating on the outstanding senior unsecured notes issued by Century Ltd., a special purpose vehicle. IBREL guarantees the notes. At the time of the withdrawal, the stable outlook reflected improved levels of cash collections as IBREL completed the construction of several development projects. It also reflected S&P's expectation that the company will continue to achieve its target for debt reduction. IBREL has progressively reduced debt via the disposal of non-core assets and equity issuance. Foreign currency exposure has reduced as IBREL has progressively bought back US$122.8 million of its US$175 million senior unsecured notes. As of early June 2016, as part of its ongoing projects, IBREL has about Indian rupee (INR) 43 billion of pending collections from the sold inventory of its development projects, as well as some recurring leasing income from its investment properties, which should provide some buffer to its credit metrics. S&P expects EBITDA interest coverage to average slightly above 2x over the next 24 months. S&P assessed IBREL's liquidity as adequate. The company has cash and equivalents of about INR15 billion as of March 31, 2016. S&P believes that IBREL has the ability to scale back its capital expenditure or dispose of assets in a liquidity crunch. INDIAN BANK: Fitch Affirms Long-Term IDR at 'BB+' ------------------------------------------------- Fitch Ratings has affirmed the Long-Term Issuer Default Ratings on nine Indian banks as follows: -- State Bank of India (SBI), Bank of Baroda, Bank of Baroda (New Zealand) Limited (BoB NZ), Punjab National Bank (PNB), Canara Bank, IDBI Bank Ltd., ICICI Bank Ltd. and Axis Bank Ltd. have been affirmed at 'BBB-' -- Indian Bank has been affirmed at 'BB+' The Outlook on the IDRs is Stable. While the IDRs of Canara Bank and IDBI Bank were affirmed, their Viability Ratings (VRs) have been downgraded by one notch to 'bb' and 'bb-' respectively, to reflect their weaker intrinsic risk profiles compared with higher-rated peers. Both banks' capital positions are at greater risk because stressed assets have increased at faster pace than capital replenishment. Fitch has revised the sector outlook on Indian banks to Negative from Stable implying that there are more downside risks for bank VRs unless the risks of deteriorating asset quality and weak earnings are counterbalanced by sizeable capital infusions. Banking sector NPLs rose sharply in the financial year ended 31 March 2016 (FY16) as a result of stricter NPL recognition standards. Asset quality could deteriorate further over the next 12-18 months given the banks' exposure to stressed sectors, such as infrastructure and iron and steel, and the difficult resolution process for stressed assets in the near term. Earnings for the sector are also likely to be weak due to muted loan growth and high credit costs. Indian banks' capital positions have historically been weak. The situation has worsened for most public-sector banks due to delayed recognition of problem assets and high loan-loss provisions, and will remain weak in the near term unless the government makes significant capital investment in the banks. The government is committed to inject $US7billion of capital in public-sector banks by FY19, out of a budgeted investment of $US11billion. However, the government or other related entities are likely to have to inject more funds because Fitch estimates the banking system needs around $US90billion of capital while many public-sector banks are likely to find it difficult to access new capital from other sources (see "APAC Banks: Chart of the Month-July 2016", which is also released today). Resolving both the asset quality and capital questions are important conditions for some banks to regain market access. The VRs could come under more pressure if the banks' capital levels are not addressed. The asset-quality and capital pressures on the system in the near term drive Fitch's negative sector outlook, but the Reserve Bank of India's reforms of the banking sector are likely to be positive over the long term. If fully implemented, the reforms should lead to better lending practices, earlier recognition of problem exposures, improved creditor rights, greater transparency, and a better capitalised and more competitive banking system. KEY RATING DRIVERS IDRS, SUPPORT RATINGS (SRs) AND SUPPORT RATING FLOORS (SRFs) The Long-Term IDRs of SBI, Bank of Baroda, PNB, Canara Bank, IDBI Bank, and ICICI Bank are at their SRFs of 'BBB-'. The ratings are driven by their SRs of '2', which reflects Fitch's expectation that they are highly likely to receive extraordinary support from the Indian government due to their high systemic importance and the government's majority ownership in all except ICICI Bank. Indian Bank - which is also majority state-owned - has an IDR and an SRF that is a notch lower than the large state-owned banks', driven by its lower SR. Indian Bank's SR of '3' reflects the moderate probability that it would receive extraordinary timely support from the Indian government because of its lower systemic importance stemming from its smaller size and more regional character. Axis Bank's IDR is driven by its VR of 'bbb-' while its SRF and SR are lower at 'BB+' and '3', respectively, mainly due to its moderate systemic importance and private ownership. The VRs of SBI, ICICI Bank, Axis Bank and Indian Bank are at the same level as their IDRs and therefore, also act as drivers for their long-term ratings. BoB NZ is a fully owned subsidiary of Bank of Baroda and its IDR is driven by expectations of high support from its parent due to the strong linkages and close integration with the latter. Fitch said, "The Stable Outlook on the IDRs mirrors the Outlook on India's rating (BBB-/Stable). It reflects our view that there is no material change in the sovereign's ability to support banks in a situation of extraordinary stress. For SBI, ICICI Bank, Axis Bank and Indian Bank, it also reflects a degree of stability in their standalone credit profiles, which are also drivers for their IDRs." VIABILITY RATING (VR) State Bank of India (SBI) SBI is India's largest bank and the only state-owned bank to have an investment grade VR. The rating reflects its very strong deposit franchise and diversified business and earnings, partly helped by its very strong government links. SBI's core capitalisation (CET1 ratio: 9.8% at FYE16) is better than that of other state-owned banks. This is likely to increase by 75-80bp with the inclusion of revaluation reserves, but more importantly, SBI is better able to raise capital from the markets (and not rely on government capital) than other government banks', which provides it with more flexibility. SBI's ratio of stressed assets (NPLs plus restructured loans) to total assets was 9.1% at FYE16, better than that for other government banks. Its proportion of capital vulnerable to further erosion as a result of potential loan losses is also lower than most other public-sector peers. Fitch expects the impending merger of SBI with its five associate banks to be neutral for its asset quality and capital, although there could be some qualitative challenges in terms of integration. Fitch believes SBI will benefit in the long term from a stronger franchise and some cost synergies. Bank of Baroda Bank of Baroda's VR of 'bb+' reflects its slightly better intrinsic financial profile than most other state banks' due to better core capitalisation and lower risk of further loan losses after the extensive clean-up exercise in FY16. Its VR benefits from its position as India's second-largest public-sector bank. The strong franchise supports a stable funding base. The rating also reflects the bank's relatively higher specific loan-loss cover than peers. Although Bank of Baroda reported huge losses in FY16 due to significantly higher credit costs, its core capitalisation improved slightly, with CET1 ratio rising to 10.3% at FYE16 from 9.4% at FYE15. This was driven by contraction in its loan book, a government capital injection of INR17.8billion (4.5% of FYE15 equity), and regulatory dispensations that allowed the inclusion of revaluation, FX translation and deferred tax asset reserves in the computation of core capital. Punjab National Bank (PNB) PNB is the third-largest public-sector bank in India and has a strong local franchise. Its VR of 'bb' reflects pressures on asset quality and core capital due to a larger stock of stressed assets compared with other major government banks. The rating also factors in the bank's strong deposit franchise, which supports the bank's above-average pre-provision profitability. The central bank's system-wide review of asset quality led to a jump in the bank's NPL ratio at FYE16 12.9% from 6.6% a year earlier, but the 130bp rise in the overall stressed assets ratio to 17.6% was relatively moderate. PNB's higher pre-provision profitability mitigates the pressure on its VR, which gives the bank greater flexibility to absorb further loan losses compared with many other government banks. Canara Bank (Canara) Canara Bank is India's fifth-largest public-sector bank with a pan-India franchise and reasonable share in system assets and deposits. Canara's VR factors in its good franchise and market position but the one-notch downgrade to 'bb' reflects the sharp deterioration in the bank's asset quality and its relatively weak core capitalisation, which is vulnerable to further erosion due to a significant increase in the bank's ratio of unprovided NPLs to equity to 66% at FYE16 from 27% at FYE15. The rating also takes into account Canara's stable funding profile with improvement in its low-cost deposit ratio. However, pre-provision profitability is lower compared with many major government banks. IDBI Bank (IDBI) IDBI is a large public-sector bank that ranks seventh in India in terms of assets. The one-notch downgrade of IDBI's VR to 'bb-' reflects a sharper deterioration in the bank's asset quality than Fitch expected, and its larger proportion of loans at risk of being classed as vulnerable compared with most other banks. IDBI's VR also factors in its lower pre-provision earnings and weaker core capitalisation, which is at risk of further erosion in the absence of significant capital injection. The rating takes into account progress the bank has made in improving its low-cost deposit ratio, but at 26%, it is the weakest amongst large state banks. Indian Bank Indian Bank is a mid-sized government bank primarily operating in the southern states of India. Its VR of 'bb+' is at the same level as its IDR and reflects its relatively better core capitalisation and moderate profitability along with its strong regional franchise. The rating factors in the deterioration in the bank's asset quality in FY16, which was in line with the trend in the system, although its stressed asset ratio of 11.5% at FYE16 was better than that for most government banks. Indian Bank's franchise is weaker compared with its larger peers' but it enjoys a stable funding profile and has a stronger market presence in south India. ICICI Bank ICICI Bank is India's second-largest bank by assets after SBI. Its VR of 'bbb-' reflects the bank's strong pan-India franchise as well as superior capitalisation and adequate profitability, which gives it greater flexibility to negotiate the asset-quality pressures it faces. The rating also reflects the bank's improved funding profile, which is underpinned by a large share of retail term and low-cost deposits. ICICI Bank's NPL ratio rose to 5.8% at FYE16 from 3.8% at FYE15, and further deterioration is likely given the bank's exposure to the vulnerable, cyclical sectors (such as steel, power and mining) and hence credit costs will remain high. However, ICICI Bank's pre-provision profits at around 5.6% of loans provide significantly greater cushion to absorb higher credit costs (FYE16: 1.5%; FYE15: 0.8%) before capital impairment risks become real. ICICI Bank's CET1 ratio of 13.1% at FYE16 is among the best in the sector and the bank may consider selling stakes in some non- bank subsidiaries to offset near-term weakness in its internal capital generation. Axis Bank Axis Bank's VR of 'bbb-' is underpinned by its stronger core capitalisation, superior profitability and improving liability profile, which lends stability to its rating against manageable asset-quality pressure. Axis Bank is India's third-largest private sector bank and its strong franchise and market position also underpin its VR. The deterioration in Axis Bank's NPL ratio to 1.7% at FYE16 from 1.3% at FYE15 was much smaller compared with the government banks, while its broader stressed-asset ratio remained stable at around 4%. However, given its exposure to certain problematic sectors, and some specific accounts that may face potential stress, the bank's asset quality over the next one to two years is likely to worsen slightly. Axis Bank's relatively strong pre-provision profitability at 4.8% of loans as at FYE16 should provide adequate buffer against a moderate increase in credit costs, which rose to around 1% in FY16 (FY15: 0.7%). Capital impairment risks in Fitch's opinion, therefore, are low and its CET1 ratio at 12.5% at FYE16 was among the highest in the system. Axis Bank's internal capital generation has also improved, given the progress in the retail segment, both in asset mix and liabilities. The bank's net interest margin widened to 3.9% in FY16 from 3.4% in FY13, while fee income has increased over the last few years. SENIOR DEBT, SUBORDINATED DEBT AND OTHER HYBRID SECURITIES The senior debt ratings of SBI, Bank of Baroda, IDBI Bank, ICICI Bank, Axis Bank and Canara Bank are at the same level as their IDRs as the debts represent unsecured and unsubordinated obligations of the banks. Legacy Upper Tier 2 bonds are rated four notches below the VR for ICICI Bank, and three notches below the VR for Bank of Baroda and Canara Bank. The notching is in accordance with Fitch's assessment of each instrument's non-performance and loss-severity risk profiles and reflects some rating compression for VRs below 'bbb-'. These subordinated debts are legacy instruments that are not Basel III-compliant. SBI's legacy perpetual Tier 1 bonds are rated five notches below its VR in accordance with Fitch's assessment of the instrument's non-performance and relative loss-severity risk profile. This legacy hybrid debt is not Basel III-compliant. RATING SENSITIVITIES IDRS AND SENIOR DEBT The VRs on Bank of Baroda, PNB, Canara Bank and IDBI Bank are lower than their SRFs and their IDRs may be downgraded if factors underpinning the SRFs weaken. For SBI, ICICI Bank and Indian Bank, where the VRs and SRFs are at the same level, their IDRs would only be downgraded if both the SRFs and the VR were to be downgraded. A downgrade of India's sovereign rating will trigger a downgrade of the banks' IDRs that are at the same level as the sovereign. Likewise, a change in the sovereign's Outlook will also lead to a revision of the Outlooks on the banks' IDRs. Axis Bank's IDR is solely driven by its VR and a downgrade to its VR, while unlikely in the near term, will lead to a downgrade to its IDR. Any changes in the banks' IDRs would result in equivalent changes in their senior debt ratings. VRS, SUBORDINATED DEBT AND OTHER HYBRID SECURITIES The 'bbb-' VRs of the private banks, ICICI Bank and Axis Bank, remain sensitive to any unexpected and/or significant asset quality deterioration, particularly if that is accompanied by a reduction in capital buffers, which currently support their ratings. The VRs of ICICI Bank and Axis Bank may also move down if the sovereign is downgraded as it is not common to have bank VRs above the sovereign rating due to operating environment- related risks. There is a negative bias on the VRs of SBI, Bank of Baroda, Canara Bank, PNB, IDBI and Indian Bank, which are sensitive to rising pressures on asset quality and capitalisation. These VRs factor in periodic government capital injections, the absence of which may weaken the banks' capital positions if asset quality continues to deteriorate. The VR of SBI will be also sensitive to downward movement in the sovereign rating or Outlook. The banks' Upper Tier 2 and hybrid Tier 1 debt are all notched down from the VRs and will be sensitive to any change in the VRs. SUPPORT RATINGS (SRs) AND SUPPORT RATING FLOORs (SRFs) The SRs and SRFs are determined by the agency's assessment of the government's propensity and ability to support a bank, based on the bank's relative size and systemic importance. A change in the government's ability to provide extraordinary support due to a change in the sovereign ratings would affect the SRs and SRFs. The SRs and SRFs will also be impacted by any change in the government's propensity to extend timely support. The rating actions are as follows: SBI: -- Long-Term IDR affirmed at 'BBB-'; Outlook Stable -- Short-Term IDR affirmed at F3' -- Viability Rating affirmed at 'bbb-' -- Support Rating affirmed at '2' -- Support Rating Floor affirmed at 'BBB-' -- $US10billion MTN programme affirmed at 'BBB-' -- $US3.5billion senior unsecured notes affirmed at 'BBB-' -- $US400 million perpetual tier 1 bonds affirmed at 'B' PNB: -- Long-Term IDR affirmed at 'BBB-'; Outlook Stable -- Short-Term IDR affirmed at 'F3' -- Viability Rating affirmed at 'bb' -- Support Rating affirmed at '2' -- Support Rating Floor affirmed at 'BBB-' Bank of Baroda: -- Long-Term IDR affirmed at 'BBB-'; Outlook Stable -- Short-Term IDR affirmed at 'F3' -- Viability Rating affirmed at 'bb+' -- Support Rating affirmed at '2' -- Support Rating Floor affirmed at 'BBB-' -- $US3billion MTN Programme 'BBB-' -- $US1.5billion senior unsecured notes under the MTN programme affirmed at 'BBB-' -- $US300 million Upper Tier 2 notes under MTN programme affirmed at 'B+' BOBNZ: -- Long-Term IDR affirmed at 'BBB-'; Outlook Stable -- Support Rating affirmed at '2' Canara Bank: -- Long-Term IDR affirmed at 'BBB-'; Outlook Stable -- Short-Term IDR affirmed at 'F3' -- Viability Rating downgraded to 'bb', from 'bb+' -- Support Rating affirmed at '2' -- Support Rating Floor affirmed at 'BBB-' -- $US2billion MTN programme affirmed at 'BBB-' -- $US850 million of senior notes under MTN programme affirmed at 'BBB-' -- $US250 million Upper Tier 2 notes under MTN programme downgraded to 'B', from 'B+' IDBI Bank: -- Long-Term IDR affirmed at 'BBB-'; Outlook Stable -- Short-Term IDR affirmed at 'F3' -- Viability Rating downgraded to 'bb-', from 'bb' -- Support Rating affirmed at '2' -- Support Rating Floor affirmed at 'BBB-' -- $US5billion medium-term note programme affirmed at 'BBB-' -- $US2billion senior unsecured notes affirmed at 'BBB-' Indian Bank -- Long-Term IDR affirmed at 'BB+'; Outlook Stable -- Short-Term IDR affirmed at 'B' -- Viability Rating affirmed at 'bb+' -- Support Rating affirmed at '3' -- Support Rating Floor affirmed at 'BB+' ICICI Bank: -- Long-Term IDR affirmed at 'BBB-'; Outlook Stable -- Short-Term IDR affirmed at 'F3' -- Viability Rating affirmed at 'bbb-' -- Support Rating affirmed at '2' -- Support Rating Floor affirmed at 'BBB-' -- $US4.2billion senior notes affirmed at 'BBB-' -- $US750 million Upper Tier 2 bonds affirmed at 'B+' Axis Bank: -- Long-Term IDR affirmed at 'BBB-'; Outlook Stable -- Short-Term IDR affirmed at 'F3' -- Viability Rating affirmed at 'bbb-' -- Support Rating affirmed at '3' -- Support Rating Floor affirmed at 'BB+' -- $US5billion MTN programme affirmed at 'BBB-' -- $US1.75billion senior unsecured notes affirmed at 'BBB-' JAIGO AGRO: ICRA Assigns B+ Rating to INR10cr Cash Credit --------------------------------------------------------- ICRA has assigned a long-term rating of [ICRA]B+ to the INR10.00 crore cash credit facilities of Jaigo Agro Industries. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long term-Cash Credit 10.00 [ICRA]B+/assigned The assigned rating takes into consideration the significant experience of the partners in the rice and dhal mill industry of over a decade and the healthy growth in the revenues over the past few years (with a CAGR of over 50% in the past three years) aided by addition of new wholesale outlets spread across Chennai. The rating also favorably takes into account the captive consumption and monetization of by-products and the state of the art, fully automated manufacturing process in the rice mill resulting in cost and labor optimization. However, the ratings are constrained by the highly competitive nature of the milling industry with limited value addition, which limits the margins of the firm which has been on a declining trend over the past few years, the low capacity utilization of ~50%, and the vulnerability of the firm's profitability to fluctuations in raw material prices. The rating also takes into account the firm's highly geared capital structure, which coupled with the weak profitability has resulted in weak coverage indicators. Further, the rating continues to factor in the agro climatic risks, which can impact the availability of the basic raw material. Going forward, the key rating drivers would be the firm's ability to improve its capacity utilization and maintain/improve its operating profit margins while sustaining the growth momentum. Jaigo Agro Industries was incorporated in 2015 as a partnership firm by merging four proprietorship concerns owned by the managing partner and his family members, namely, Murrali Modern Rice Mill engaged in operating a rice mill since 2004, Sumathi Traders and Perumal Traders which have been engaged in the trading of dhal and rice since 2013 and Goutham Dhall Mill which has been operating a dhal mill from 2015. It is engaged in milling, processing, sorting and trading of rice and dhal. The firm's product profile comprises of non-basmati rice, Urid dhal, Moong dhal and Toor dhal. The firm sells the products in the brand name of "Jaigo" and "MMR". The firm has capacity to manufacture 100 tonnes per day of rice and 150 to 200 tonnes of dhal per month (operating in a single shift of 12 hours per day). The firm has a fully automated modernized facility in Redhills, Chennai. Recent Results The firm reported a net profit of INR0.4 crore on an operating income of INR27.8 crore during 2014-15 as against a net profit of INR0.3 crore on an operating income of INR19.3 crore during 2013- 14. KALINDI ISPAT: Ind-Ra Assigns 'IND BB-' Long-Term Issuer Rating --------------------------------------------------------------- India Ratings and Research (Ind-Ra) has assigned Kalindi Ispat Pvt Ltd (KIPL) a Long-Term Issuer Rating of 'IND BB-'. The Outlook is Stable. KEY RATING DRIVERS KIPL's ratings reflect its small scale of operations, with provisional (P) FY16 financials indicating revenue of INR322m (FY15: INR466m) and moderate operating margins of 7% (4.7%) The ratings also consider KIPL's weak credit profile, with gross interest coverage (operating EBITDA/gross interest expense) of 1.3x in FY16 (P) (FY15: 1.2x) and net financial leverage (total adjusted net debt/operating EBITDAR) of 3.8x (5.6x). The ratings also consider KIPL's tight liquidity; the average utilisation of its fund-based working capital limits was more than 97.20% for the six months ended May 2016. The ratings also factor its high customer concentration risk, as its top five customers contributed 51.51% to overall revenues during FY16 (P). However, the ratings are supported by KIPL's founders' experience of more than a decade in the steel industry. RATING SENSITIVITIES Positive: An improvement in the scale of operations, along with an improvement in credit metrics, would lead to a positive rating action. Negative: A decline in profitability, leading to deterioration in credit metrics, may lead to a negative rating action. COMPANY PROFILE KIPL was incorporated in 2004 and manufactures sponge iron. It has an installed capacity of 60,000mtpa at its manufacturing facility in Bilaspur, Chattisgarh. KIPL's ratings: -- Long-Term Issuer Rating: assigned 'IND BB-'/Stable -- INR117.50 million fund-based working capital limits: assigned 'IND BB-'/ Stable -- INR10 million non-fund-based working capital limits: assigned 'IND A4+' KESAR IMPEX: ICRA Suspends 'B' Rating on INR9.0cr Cash Loan ----------------------------------------------------------- ICRA has suspended the long term rating of [ICRA]B outstanding on the INR9.00 Crore cash credit facilities and the INR2.50 crore term loans of Kesar Impex. The suspension follows ICRA's inability to carry out a rating surveillance in the absence of the requisite information from the company. KINGFISHER: SBI Had Offered to Settle Loan Issue With Mallya ------------------------------------------------------------ The Times of India reports that State Bank of India (SBI) is willing to have a one-time settlement of the Kingfisher Airlines loan issue with Vijay Mallya if he agrees to repay the outstanding principal amount along with some interest and legal fees, but the former liquor baron has put conditions which are unacceptable to the bank, its top official has told a parliamentary panel. According to TOI, SBI chairman Arundhati Bhattacharya told the panel, which is scrutinizing amendments to debt recovery laws, that the bank has aggressively tackled the matter and is open to reaching one-time settlements if a debtor offers to repay the principal along with a reasonable amount of interest, sources said. "We are not insisting on payment of interest upon interest," she reportedly told MPs, TOI relays. This led some members of the all-party panel to ask the SBI boss about the bank's stance on Mallya, especially whether the largest bank, which leads the consortium of PSBs that sunk money in Kingfisher Airlines, was ready for a one-time settlement with Mallya after taking a haircut. She replied in the affirmative, but said that while Mallya had expressed his willingness to have a settlement he had ringed it with conditions which SBI could not accept, said a person familiar with the deliberations, TOI relates. Source said Bhattacharya stuck to her guns when some members mentioned reports about Mallya's counsel telling the Supreme Court that he was ready to pay INR6,000 crore against the INR4,900 crore he had borrowed from PSBs, according to TOI. If the lenders' stance finds resonance with the political establishment, the latest development could mean a breakthrough in settling one of the most high-profile bad loan cases involving Indian industrialists, TOI reports. TOI relates that members of the panel also asked RBI governor Raghuram Rajan whether lenders were mandated by the central bank to take personal guarantees from promoters of corporate units they lend to, but Rajan said the RBI had not issued any such directive. According to the report, advisers to Mallya's tottering UB Group have spoken about reaching an understanding with bankers on the broad contours of a possible settlement deal. This involves payment of the outstanding principal estimated at INR4,850 crore, an interest payout of around INR150 crore and the legal fees incurred by the lenders. But they have cautioned that any settlement could move forward only if the political leadership agrees with the assessment of the bankers, the report says. Mallya, who is currently holed up in London and whose extradition India has sought, has become the symbol of the domestic banking system's fight to recoup loans from defaulting billionaires. A settlement would enable Mallya to return to the country, TOI states. About Kingfisher Airlines Headquartered in Mumbai, India, Kingfisher Airlines -- http://www.flykingfisher.com/-- formerly known as Deccan Aviation Ltd., served about 35 domestic destinations with a fleet of more than 40 aircraft, including Airbus jets and ATR 72 turboprops. As reported in the Troubled Company Reporter-Asia Pacific on Jan. 15, 2014, Bloomberg News said Kingfisher has grounded planes since October 2012. The airline lost its operating license in January last year after failing to convince authorities it has enough funds to restart flights. The airline defaulted on payments to lessors, creditors and airports as losses widened amid rising fuel costs and competition. According to Bloomberg News, Mr. Mirpuri said in an e-mail on January 13 the airline continues its efforts to recapitalize and restart services. As reported in the TCR-AP on May 18, 2015, CRISIL's ratings on bank loan facilities of Kingfisher Airlines Ltd (KFAL) continue to reflect delays by KFAL in servicing its debt; the delays have been caused by the company's weak liquidity and continued losses at the operating level. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Cash Credit 8940 CRISIL D (Reaffirmed) Funded Interest Term Loan 2260 CRISIL D (Reaffirmed) Long Term Loan 5970 CRISIL D (Reaffirmed) Rupee Term Loan 35270 CRISIL D (Reaffirmed) Short Term Loan 390 CRISIL D (Reaffirmed) Working Capital Term Loan 2990 CRISIL D (Reaffirmed) Losses in the past seven years have resulted in a complete erosion of KFAL's net worth, leading to its weak financial risk profile. Presently, the company does not carry out any commercial operations. KUBER FOODS: ICRA Suspends 'B' Rating on INR10cr Fund Based Loan ---------------------------------------------------------------- ICRA has suspended the long term rating of [ICRA] B assigned to the INR10.0 crore fund based limits of Kuber Foods. The suspension follows ICRA's inability to carry out rating surveillance in the absence of 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. L7H LIFE: ICRA Downgrades Rating on INR8.61cr LT Loan to 'D' ------------------------------------------------------------ ICRA has revised the long term rating assigned to the INR8.61 crore term loan from [ICRA]B- to [ICRA]D and the short term rating assigned to the INR8.00 crore non-fund based (sub-limit) facilities from [ICRA]A4 to [ICRA]D for the bank facilities of L7H Life Resources Private Limited. The revision in ratings takes into account the recent developments of delays in meeting debt obligations on term loans. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long term-term loan 8.61 Revised from [ICRA]B- to [ICRA]D and suspended Short term-non fund (8.00) Revised from [ICRA]A4 based limits to [ICRA]D and suspended ICRA has also suspended the long term and short term ratings of [ICRA]D/ [ICRA]D for the bank facilities of L7H Life Resources Private Limited. The suspension follows ICRA's inability to carry out a rating surveillance in the absence of the requisite information from the company. LORDS MARK: Ind-Ra Assigns 'IND BB+' Long-Term Issuer Rating ------------------------------------------------------------ India Ratings and Research has assigned Lords Mark Industries Private Limited (LMIPL) a Long-Term Issuer Rating of 'IND BB+'. The Outlook is Stable. KEY RATING DRIVERS The ratings reflect LMIPL's moderate financial and credit profile. The company's provisional FY16 financials indicate revenue of INR875 million (FY15: INR735 million; CAGR 14.84% during FY12-FY16), net financial leverage (net adjusted debt/operating EBITDAR) of 3.4x (4.7x), interest coverage of 2.2x (2.2x) and EBITDA margins of 5.9% (3.9%). The management expects the EBITDA margin to improve in FY17 on scale benefits with top line growing at above 50% yoy because of increased order flow. The company had an order book worth INR1,150 million at FYE16 which will be executed by September 2016. In 1QFY17, the company is likely to have recorded revenue of INR370 million. The ratings further reflect LMIPL's modest liquidity profile with its fund-based facilities being utilised at an average of 94% over the 12 months ended June 2016. The ratings are supported by over two decades of operating experience of the company's promoters in the paper industry and solar LED manufacturing industry. RATING SENSITIVITIES Positive: Substantial growth in the top line and profitability leading to a sustained improvement in the overall credit metrics could lead to a positive rating action. Negative: A significant decline in the profitability resulting in a sustained deterioration in the overall credit metrics could lead to a negative rating action. COMPANY PROFILE LMIPL was incorporated in 1998 as a private limited company by Mr Sachidanand Upadhyay. The company produces and sells bottled water under the brand name AQUA FRESH in Maharashtra. The company entered into the business of paper trading in 2005 and started selling paper reams by procuring them from local paper mills and importers. In 2006, the company started manufacturing paper at its 96,000 metric tonnes per annum facility in Vasai, Maharashtra. It started solar LED products manufacturing in 2014 at the same facility with an installed capacity of 9.4 million units per annum. LMIPL's ratings: -- Long-Term Issuer Rating: assigned 'IND BB+'; Outlook Stable -- INR20.2 long-term loan: assigned 'IND BB+' Outlook Stable -- INR290 million fund-based facilities: assigned 'IND BB+'/Stable; 'IND A4+' -- INR50 million non-fund-based facilities: assigned 'IND A4+' MANIKANTA CONSTRUCTIONS: ICRA Suspends B+ Rating on INR3cr Loan --------------------------------------------------------------- ICRA has suspended long-term rating of [ICRA]B+ to INR3.00 crore fund based facilities and short-term rating of [ICRA]A4 to INR4.00 crore non fund based limits and long term and short term rating of [ICRA]B+/[ICRA]A4 to INR1.00 crore unallocated limits of Manikanta Constructions. The suspension follows ICRA's inability to carry out a rating surveillance in the absence of the requisite information from the firm. Manikanta Constructions is a partnership firm based out of Nizamabad, Telangana setup in 2002 by Mr. Surender Rao. The firm is engaged in civil construction and undertakes government projects for road development & construction of bridges in Andhra Pradesh and Telangana region. MONOPOLY YARNS: ICRA Revises Rating on INR4.39cr Loan to B- ----------------------------------------------------------- ICRA has revised the long-term rating from [ICRA]B to [ICRA]B- assigned to the INR5.89 crore fund based bank limits of Monopoly Yarns Private Limited. The long-term rating assigned to the INR6.46 crore unallocated limit of ICRA has been revised to [ICRA]B-, while the short-term rating has been reaffirmed at [ICRA]A4. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long term fund 1.50 [ICRA]B- Revised from based limit- [ICRA]B Overdraft Long term fund 4.39 [ICRA]B- Revised from based limit-Term [ICRA]B Loans Unallocated Limit 6.46 [ICRA]B-/[ICRA]A4 Revised/Reaffirmed The revision in rating takes into account the asset-liability mismatch caused by unfavorable repayment schedule of term loans availed and the company's weak profitability as a result of the adverse cost structure, which is unlikely to be corrected in the near term. The ratings also consider the small scale of the company's operations accompanied by flat revenue growth, and the weak financial profile characterized by continuing net losses leading to erosion of net worth, high debt and consequently an adverse capital structure. The ratings are constrained by the susceptibility of profit margins to volatility in the prices of polyester chips and a concentrated customer base with around 40% of the sales coming from the top five customers in the last two years. Further, the company procures polyester chips, its major raw material solely from JBF Industries Limited which results in weak bargaining power. The ratings, however, continue to favorably factor in the promoters' long experience in the yarn processing and manufacturing business and the locational benefits received by the company by virtue of its presence in Silvassa. ICRA expects MYPL's revenues to remain stagnant in FY2017; the prices of its key raw material follow the crude oil prices, a further decline of which may lead to a falling trend in sales realization. Timely debt servicing and achievement of financial breakeven will be critical for improvement of the company's credit profile and would be the key rating sensitivities going forward. Monopoly Yarns Private Limited (MYPL), a closely held company, is a part of the Shri Damodar Group, which processes and manufactures polyester filament yarn. The company was incorporated in 1995 and commenced operations from March 2010. MYPL is engaged in manufacturing polyester filament yarn, used as a raw material for textile and industrial applications and 20D (denier) monofilament polyester yarns, which is mostly used in the production of fabrics for automotive use. The company's manufacturing unit is in Silvassa (Union Territory of Dadra and Nagar Haveli) having a capacity of processing ~135 tonnes of yarn per month. The company has its registered office in Mumbai. Established in 1983, Shri Damodar Yarn Manufacturing Private Limited {Rated [ICRA]BBB-(Stable)/[ICRA]A3} is also a part of the Shri Damodar group and engaged in processing of yarn which involves binding, twisting and dyeing. The processed yarn is used by the manufacturers of fabric, dress materials, suiting and furnishing. Both the companies sell their products under the brand name 'Shri Damodar'. Recent results MYPL recorded a net loss of INR4.07 crore on an operating income of INR16.24 crore for the year ending March 31, 2016 (Provisional numbers). MONTFORT EDUCATIONAL: ICRA Assigns 'B' Rating to INR3.30cr Loan --------------------------------------------------------------- ICRA has assigned a long term rating of [ICRA]B to the INR9.07 crore fund based facilities of The Montfort Educational Society. ICRA has also assigned a long term rating of [ICRA]B to the INR0.93 crore unallocated amount of MES. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term Fund Based - OD 1.00 [ICRA]B assigned Long Term Fund Based- Term Loan 3.30 [ICRA]B assigned Long Term Fund Based- Term Loan 2.27 [ICRA]B assigned Long Term Fund Based- Term Loan 2.50 [ICRA]B assigned Unallocated amount 0.93 [ICRA]B assigned The assigned rating is constrained by Montfort's small scale of operations, increasing competitive intensity resulting in difficulty in attracting and retaining quality students and teachers and vulnerability of operations to the regulated nature of the Indian education industry. The rating is also constrained by the Inherent cash flow mismatches, given the nature of business of education institutes as fee receipts are collected on a quarterly basis vis-a-vis monthly obligations for interest payments. The assigned ratings however favourably factor in the extensive experience of the trustees spanning over a decade in the education sector; healthy occupancy levels with an overall occupancy ratio of 93% in Academic Year 2015-16 and comfortable capital structure with a gearing of 0.64 times as on March 31, 2016. ICRA expects Montfort's scale of operations to improve supported by new admissions, addition of a new school and expected rise in fees. In ICRA's view, the company's ability to attract and retain well qualified and experienced teaching staff to remain competitive and maintain profitability would be the key rating sensitivities. The Montfort Educational society (Montfort or MES) was established by Dr. John K V in 2006. The Montfort Educational society was registered after the catholic saint, St. Louise Mary Gregone de Montfort. The society started its first educational institution under the banner K John Public School in 2007 in Eastern Nagpur. The second institution under the same name was established in 2008 at Saoner, Nagpur. In April 2016, the society has also established a nursery school at Besa in Nagpur. Both the schools offer education from Nursery to Class 10 and are affiliated to the Central Board for Secondary Education (CBSE). The campus at Saoner is spread across an area of 10 acres and the campus at Asoli is spread across an area of 3 acres. It provides facilities like playground, indoor games, dance room, music room, science laboratory, computer lab, health & medical check-up room and transportation through its own buses. The total number of students in both the schools is 2,951 students and the number of teachers is 92, implying a student teacher ratio of 32:1. Recent Results MES recorded a net profit of INR1.84 crore on an operating income of INR7.13 crore for the year ending March 31, 2016 (as per the provisional figures disclosed by the management). MOULI SPINNER: ICRA Suspends B+/A4 Rating on INR15cr Bank Loan -------------------------------------------------------------- ICRA has suspended the long-term rating of [ICRA]B+ and the short-term rating of [ICRA]A4 assigned to the INR15.00 crore bank facilities of Mouli Spinner Limited. The suspension follows ICRA's inability to carry out a rating surveillance in the absence of the requisite information from the company. NARULA EXPORTS: ICRA Suspends B+/A4 Rating on INR8cr Loan --------------------------------------------------------- ICRA has suspended [ICRA]B+ and [ICRA]A4 ratings assigned to the INR8 Crore fund based and non fund based facilities of Narula Exports. The suspension follows ICRA's inability to carry out a rating surveillance in the absence of the requisite information from the company. NITESH RESIDENCY: ICRA Suspends B+ Rating on INR312.50cr Loan ------------------------------------------------------------- ICRA has suspended the rating of [ICRA]B+ assigned to the INR312.50 crore bank facilities of Nitesh Residency Hotels Private Limited. The suspension follows ICRA's inability to carry out a rating surveillance in the absence of the requisite information from the company. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term-Term Loans 312.50 [ICRA]B+ suspended 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. Nitesh Residency Hotels Private Limited (NRHPL), incorporated in 2006, is a Bangalore based company in the hospitality sector. It is promoted by Mr. Nitesh Shetty together with CPI India Limited for the development, operation and maintenance of a 5-star deluxe hotel at Residency Road, Bangalore. An operating agreement has been signed with M/s Marriott Hotels India Private Limited for the operation of the 277 room hotel as a Ritz Carlton brand hotel. The hotel has been operational since November 2013. P.A.S. COTTON: ICRA Suspends D Rating on INR6.89cr Term Loan ------------------------------------------------------------ ICRA has suspended [ICRA]D rating assigned to the INR6.89 crore term loan facilities, INR5.00 crore long-term fund based facilities, INR5.04 crore long-term proposed facilities and INR1.75 crore short-term non-fund based facilities of P.A.S. Cotton Mills Private Limited. The suspension follows ICRA's inability to carry out a rating surveillance in the absence of the requisite information from the Company. According to its suspension policy, ICRA may suspend any rating outstanding if in its opinion there is insufficient information to assess such rating during the surveillance exercise. PREMIER STEELS: ICRA Suspends B+ Rating on INR10cr LT Loan ---------------------------------------------------------- ICRA has suspended the [ICRA]B+ rating assigned to the INR10.00 crore long term fund based facilities of Premier Steels. 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 1983, Premier Steels is primarily engaged in trading of steel products such as Mild Steel (MS) Angles, MS Channels, MS Plates, HR (Hot Rolled) sheets and TMT (Thermo Mechanically Treated) bars. It has a stock yard located in Ernakulam (Kerala). The firm has three equal partners, Mr. T P Ismail, Mrs. Waheedha Mohammed Ashraf and Mr. V.A. Mohammed Ashraf. PSK DEVELOPERS: Ind-Ra Cuts Long-Term Issuer Rating to 'IND B+' ---------------------------------------------------------------- India Ratings and Research (Ind-Ra) has downgraded PSK Developers Pvt. Ltd's (PSK) Long-Term Issuer Rating to 'IND B+' from 'IND BB'. The Outlook is Stable. The agency has also downgraded PSK's INR1,850 million term loan to 'IND B+'/Stable from 'IND BB'. KEY RATING DRIVERS The downgrade reflects the increased funding and execution risks caused by the delay of almost a year in PSK's ongoing project - Fashion Index. Management had expected to complete construction till the plinth level by end-2QFY16, but it was eventually completed by end-1QFY17. Management has attributed this delay primarily to delayed approval from the Mumbai municipal corporation. The downgrade also factors in the cost escalation caused by the delay, as the increased rental expenses to INR382m from INR245.6 million led to a similar increase in the project cost to INR4,021 million from INR3,888 million. Since this is a redevelopment project and PSK does not receive any income for the redevelopment portion of the site (268 residential units), the funding gap has been further exacerbated with the high inventory. Of the total promoter contribution of INR980 million, INR570 million had been injected as at FYE16 in the form of equity. The increased project cost will also be borne by the promoters. The downgrade also reflects saleability risks as management initially planned to sell 22% (73) of the total commercial units (333) by FYE16, but this has been delayed due the delay in completion of plinth stage. The company has not sold any units so far, exacerbating the risk of cash flow mismatches. The ratings are supported by the large moratorium period, under which the first principal instalment is due in 2QFY19, while interest is being charged and paid currently. RATING SENSITIVITIES Positive: Project completion within the scheduled timeframe and strong cash flow visibility on account of an increase in unit sales could lead to a positive rating action. Negative: Further leveraging of the existing business for new projects and/or time and cost overruns, stressing cash flows for debt servicing, could lead to a negative rating action. COMPANY PROFILE Incorporated in 2004, Mumbai-based PSK is engaged in residential real estate redevelopment. Its ongoing project -- Fashion Index -- is a commercial as well as residential redevelopment located in Dadar (Mumbai). The project comprises 268 residential units (to be handed over to the current tenants) and 333 commercial units (developer's share). QUAIL CV: Ind-Ra Assigns 'IND B+(SO)' Rating to Series A3 PTCs -------------------------------------------------------------- India Ratings and Research (Ind-Ra) has assigned Quail CV IFMR Capital 2016 (an ABS transaction) provisional ratings as follows: -- INR89.4 million Series A1 pass through certificates (PTCs): assigned 'Provisional IND A-(SO)'; Outlook Stable -- INR53.9 million Series A2 PTCs: assigned 'Provisional IND A- (SO)'; Outlook Stable -- INR17.5 million Series A3 PTCs: assigned 'Provisional IND B+(SO)'; Outlook Stable The final ratings are contingent upon the receipt of final documents conforming to the information already received. The commercial vehicle loan, multi-utility vehicle loan, four- wheeler loan and tractor loan pool to be assigned to the trust has been originated byKogta Financial (India) Limited. KEY RATING DRIVERS The provisional ratings are based on the origination, servicing, collection and recovery expertise of Kogta Financial (India), the legal and financial structure of the transaction and the credit enhancement (CE) provided in the transaction. The provisional rating of Series A1 and Series A2 PTCs addresses the timely payment of interest on monthly payment dates and ultimate payment of principal by the final maturity date on 17 December 2019 in accordance with the transaction documentation. The provisional rating of Series A3 PTCs addresses the timely payment of interest on monthly payment dates only after the complete redemption of Series A1 and Series A2 PTCs and ultimate payment of principal by the final maturity date on 17 December 2019, in accordance with the transaction documentation. The transaction benefits from the internal CE on account of excess interest spread, subordination and over-collateralisation. The levels of overcollateralisation available to Series A1 and Series A2 is 18.0% of the initial pool principal outstanding (POS) and overcollateralisation available to Series A3 is 8.0% of the initial pool POS. The total excess cash flow or the internal CE available including overcollateralisation to Series A1 and Series A2 PTCs together and Series A3 PTCs is 36.3% and 23.2%, respectively, of the initial POS. The transaction also benefits from the external CE of 5.0% of the initial POS in the form of fixed deposits in the name of the originator with a lien marked in favour of the trustee. The collateral pool to be assigned to the trust at par had the initial POS of INR174.8m, as of the pool cut-off date of 31 May 2016. The external CE will be used in case of a shortfall in a) complete redemption of all Series of PTCs on the final maturity date, b) monthly interest payment to Series A1 and Series A2 investors c) monthly interest payment of Series A3 investors after the complete redemption of Series A1 and Series A2 investors and d) any shortfall in Series A3 maximum payout on the Series A3 final maturity date. RATING SENSITIVITIES As part of its analysis, Ind-Ra built a pool cash flow model based on the transaction's financial structure. The agency also analysed historical data to determine the base values of key variables that would influence the level of expected losses in this transaction. The base values of the default rate, recovery rate, time to recovery, collection efficiency, prepayment rate and pool yield were stressed to assess whether the level of CE was sufficient for the current rating levels. Ind-Ra also conducted rating sensitivity tests. If the assumptions of the base case default rate worsen by 20%, the model-implied rating sensitivity suggests that the rating of Series A1 and Series A3 PTCs will not be impacted. However if the assumptions of the base case default rate worsen by 20%, the model-implied rating sensitivity suggests that the rating of Series A2 PTCs will be downgraded by two notches. RAJNISH STEELS: ICRA Reaffirms B+ Rating on INR8.0cr LT Loan ------------------------------------------------------------ ICRA has reaffirmed the long-term rating of [ICRA]B+ and the short-term rating of [ICRA]A4 to the fund-based and non-fund based limits aggregating to INR11.00 crore of Rajnish Steels. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long-term: Fund Based Limits 8.00 [ICRA]B+/Reaffirmed Short-term: Non Fund Based Limits (5.40) [ICRA] A4 Reaffirmed Both Long Term and 3.00 [ICRA]B+/[ICRA] A4 Short Term Scale: Reaffirmed Unallocated Limits The ratings reaffirmation takes into account the over three- decade long experience of the promoters in the steel-trading business and the positive outlook on prices of long-steel products post implementation of MIP from February 2016. However, the ratings are constrained by the subdued profitability indicators on account of intense competition and limited value addition in steel-trading business. The company reported a revenue de-growth during FY2016 due to lower sales under the ship-breaking segment. The firm purchased only one ship during FY2016 due to sharp fall in prices of steel products. The ratings are also constrained by the high gearing level, resulting from working capital-intensive operations. The ratings action also factors in the susceptibility of the firm's profitability to adverse fluctuation in end-product prices, inherent cyclical nature as well as environmental risks related with the ship- breaking business. The ratings further take into account the high customer concentration risk as well as risks associated with its constitution as a proprietorship firm, including the possibility of capital withdrawals by the proprietor. Incorporated in 1980, Rajnish Steel (RS) is a proprietorship concern set up by Mr. Rajnish K. Gupta. The firm has been involved in steel-trading business for over three decades and primarily trades in long-steel products. During FY2013, it ventured into ship-breaking business to support revenue growth and diversify its revenue base. The ship-breaking operations are carried out at the ship-breaking yard at Darukhana, Mumbai. Recent Results For FY2016, the firm reported Profit after Tax (PAT) of INR0.08 crore on an Operating Income (OI) of INR17.56 crore. (Provisional). During FY2015, the firm reported a PAT of INR0.10 crore on an operating income of INR21.47 crore. RAJU SPINNING: ICRA Suspends 'D' Rating on INR13.56cr Loan ---------------------------------------------------------- ICRA has suspended [ICRA]D rating assigned to the INR13.56 crore term loan facilities, INR22.00 crore long-term fund based facilities, INR0.26 crore long-term non-fund based facilities, INR17.01 crore long-term proposed facilities and INR5.00 crore short-term non-fund based facilities of Raju Spinning Mills Private Limited. The suspension follows ICRA's inability to carry out a rating surveillance in the absence of the requisite information from the Company. According to its suspension policy, ICRA may suspend any rating outstanding if in its opinion there is insufficient information to assess such rating during the surveillance exercise. RAMANJANEYA MODERN: ICRA Suspends B+ Rating on INR5.0cr Loan ------------------------------------------------------------ ICRA has suspended long term rating of [ICRA]B+ assigned to the INR5.00 crore fund based facilities of Ramanjaneya Modern Rice Mill. The suspension follows ICRA's inability to carry out a rating surveillance in the absence of the requisite information from the firm. Ramanjaneya Modern Rice Mill (RMRM) is engaged in the milling of paddy and produces raw rice. The rice mill is located in Cherukuwada village of West Godavari in Andhra Pradesh. The production capacity is 120 MT per day and it produces non-basmati variety of rice which is non-sortex. RMRM, apart from selling rice to FCI, sells it to dealers in Assam and Maharashtra who then export it to countries like Bangladesh. SAHITYA SADAWART: ICRA Suspends D Rating on INR11.40cr Bank Loan ---------------------------------------------------------------- ICRA has suspended long term Rating of [ICRA]D assigned to the INR11.40 Crore bank lines of Sahitya Sadawart Samiti(SSS). The suspension follows ICRA's inability to carry out a rating surveillance in the absence of the requisite information from the company. SSS was incorporated in 1959 under the Rajasthan Societies Registration Act, 1953 and commenced operations in 1994. The society operates Suresh Gyan Vihar University and two schools in Jaipur (Rajasthan), namely Gyan Vihar School and Sahitya Sadawart Senior Secondary School. The university offers courses in Engineering (B.Tech, M.Tech, Ph D), Management (BBA, MBA, Ph.D, B.Com), Computer Applications (BCA, MCA), Science (M.Sc., Ph.D) Pharmacy (B.Pharm., M.Pharm., Ph.D), Education (B.Ed, M.Ed, Ph.D) and Hotel Management (BHMCT, BHMTT). The university campus is located in Jagatpura, Jaipur. Mr. Sunil Sharma is the chancellor of the Suresh Gyan Vihar University and is a key member of the society. SEEMA OIL: ICRA Suspends B+/A4 Rating on INR15cr Bank Loan ---------------------------------------------------------- ICRA has suspended its long-term rating of [ICRA] B+ and short- term rating of [ICRA] A4 assigned to the INR15.00 crore bank facilities of Seema Oil Traders. The suspension follows ICRA's inability to carry out a rating surveillance in the absence of the requisite information from the company. SHARMA BROTHERS: ICRA Suspends B+ Rating on INR6.04cr Loan ---------------------------------------------------------- ICRA has suspended the long term rating of [ICRA] B+ on the INR6.04 crore bank lines of Sharma Brothers. The suspension follows ICRA's inability to carry out a rating surveillance in the absence of the requisite information from the company. SHRI AGRAWAL: ICRA Reaffirms B+ Rating on INR21cr LT Loan --------------------------------------------------------- ICRA has reaffirmed its long-term rating of [ICRA]B+ on the INR21.00 crore fund-based bank facilities of Shri Agrawal Educational and Cultural Society. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term Fund Based Limits 21.00 [ICRA]B+; reaffirmed The rating reaffirmation takes into account the modest operational profile of the society given slight improvement in occupancy levels in the engineering college to 49% for Academic Year (AY) 2015-16 relative to 38% in the previous year along with year on year improvement in the occupancy of school in its third year of operations. Though the occupancies and student strength in school is expected to increase going forward; the accruals from the existing operations of the society are likely to remain modest. Given the increasing scheduled repayments, SAEC will shall continue to require funding support from the promoters, Further, the society is expected to incur some capital expenditure in the school on account of increasing student strength. The capital structure of the society is moderate with gearing of 1.7x as on March 31, 2016 owing to past deficits and debt funded capex for setting up the engineering college and school. The debt coverage indicators would continue to remain modest given the leveraged capital structure, modest accruals and high debt repayment liabilities. The rating also remains constrained on account of stretched liquidity profile of the society on account of delays in receipt of fees from the students. The rating however, favorably takes into account the extensive track record of the management in the education field in Madhya Pradesh, having established a total of five colleges and three schools in Bhopal, under two societies and their regular support towards funding the deficit and capex being undertaken. Going forward, the ability of the society to achieve adequate occupancies in the engineering college in the light of presence of a number of colleges / schools in nearby areas and manage the liquidity through timely fee collection would remain the key rating sensitivities. Any major debt funded capital expenditure and timely funding from promoters will be the key monitorables. SAEC was formed in FY 2008 by Mr. Sudhir Kumar Agrawal. The society has set up an engineering college under the name, Sagar Institute of Science, Technology and Engineering in Ratibad (Bhopal) which is affiliated to Rajiv Ghandhi Proudyogiki Vishwavidyalaya, Bhopal (Madhya Pradesh). The engineering college commenced operations from AY 2009-10 with an intake of 90 students and presently has a strength of 816 students (in AY 2015-16). The college offers graduate (B.E.) and post-graduate (M.E.) courses. The society has also set up a school - 'Sagar Public School' in Bhopal which commenced operations from AY 2014- 15 and currently running classes up to Standard VIII, and student strength of 1139 for AY 2016-17. SAEC is part of the Bhopal based Sagar group, which has operations across education, real estate and textile sectors. In addition to SAEC, another society in the Sagar group, Shri Agrawal Educational and Welfare Society, has set up four colleges and two schools in Bhopal which have a total strength of ~8,300 students (of which about 5,000 are students in schools). Two group companies, Agrawal Builders and Agrawal Builders and Colonizers have been engaged in civil construction and real estate development for the past three decades in Bhopal. Another group company - Sagar Manufacturers Private Limited (rated [ICRA]BBB-(Stable)/[ICRA]A3), manufactures cotton spun yarn and has a spinning unit in Madhya Pradesh with an installed capacity of 75,552 spindles, which commenced commercial production from March 2013. SHRI MAHAVIR: ICRA Suspends 'B' Rating on INR8.0cr Bank Loan ------------------------------------------------------------ ICRA has suspended the long term rating of [ICRA] B assigned to the INR8.00 crore fund based limits and the short term rating of [ICRA]A4 assigned to INR0.10 crore non fund based limits of Shri Mahavir Cereals. The suspension follows ICRA's inability to carry out rating surveillance in the absence of 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. SHRI VASANTHRAJ: ICRA Assigns 'D' Rating to INR3.0cr LT Loan ------------------------------------------------------------ ICRA has assigned a long-term rating of [ICRA]D to the INR2.02 crore term loan facilities and the INR3.00 crore fund based facilities of Shri Vasanthraj Textiles Private Limited. ICRA has also assigned a long-term/short-term rating of [ICRA]D to the INR2.98 crore proposed facilities of SVT. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term Loan Facilities 2.02 [ICRA]D/Assigned Long Term Fund based facilities 3.00 [ICRA]D/Assigned Short term/Long term Unallocated limits 2.98 [ICRA]D/Assigned The assigned ratings reflect the delays witnessed in servicing the debt obligations by the company, owing to its stressed liquidity position. The company's scale of operations remains small which restricts the benefits from economies of scale and the presence in the highly commoditized market with intense competition inhibits its pricing flexibility, thereby exposing the margins to fluctuations in cotton and yarn prices. Cumulatively, these have led to a weak financial profile of the company characterized by thin margins, stretched capital structure and inadequate debt protection metrics. ICRA takes note of the experience of promoters in the textile industry and the efforts taken by them to increase the scale of operations, although the results remain to be seen. Early regularisation of debt servicing is critical and remains the key rating sensitivity. Shri Vasanthraj Textiles Private Limited, established in the year 1992 is engaged in the manufacture of cotton yarn in the count range of 40's to 60's. The Company's manufacturing facility is located in R. Vadipatti (Tamil Nadu) with an installed capacity of ~14400 spindles. SVT sells its produce majorly in the markets of Malegoan, Berhampur etc mostly through agents. Recent Results The company reported a net profit of INR0.02 crore on an operating income of INR10.89 crore during 2014-15 as against a net loss of INR(0.19) crore on an operating income of INR13.32 crore during 2013-14. SIPAI COTTON: ICRA Suspends B+ Rating on INR6cr Cash Loan --------------------------------------------------------- ICRA has suspended the [ICRA]B+ rating assigned to the INR6.00 crore long term cash credit limit of Sipai Cotton Industries. The suspension follows ICRAs inability to carry out a rating surveillance in the absence of the requisite information from the company. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Fund Based-Cash Credit 6.00 [ICRA]B+; Suspended Sipai Cotton Industries (SCI) was set up in 1999 as a partnership firm by Mr. Ibrahim Sipai with an experience of more than a decade, and his family members and relatives as cotton ginning and pressing unit located at Wankaner, Gujarat. It is also engaged in trading activities of cotton bales and cottonseed. At present, the firm has installed 28 ginning machines and 1 pressing machine. SPRINGBOARD ENTERPRISES: ICRA Suspends B Rating on INR6cr Loan -------------------------------------------------------------- ICRA has suspended the long term rating of [ICRA] B assigned to the INR6.00 crore fund based limits and the long term rating of [ICRA] B and short term rating of [ICRA]A4 assigned to the INR4.00 crore unallocated Line of Credit of Springboard Enterprises India Limited. The suspension follows ICRA's inability to carry out rating surveillance in the absence of requisite information from the company. According to its suspension policy, ICRA may suspend any rating outstanding if in its opinion there is insufficient information to assess such rating during the surveillance exercise. SRI KARUNAMBIKAI: ICRA Suspends B Rating on INR20.3cr Term Loan --------------------------------------------------------------- ICRA has suspended the long-term rating of [ICRA]B assigned to the INR20.3 crore term loan facilities, INR12.50 crore fund based facilities of Sri Karunambikai Mills Private Limited. ICRA has also suspended the short-term rating [ICRA]A4 assigned to the INR30.75 crore fund based facilities and INR10.85 crore non-fund based facilities of the Company. 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. TRISHLA BUILDTECH: ICRA Suspends 'B' Rating on INR34cr Loan ----------------------------------------------------------- ICRA has suspended the long term rating of [ICRA] B on the INR34.0 crore bank lines of Trishla Buildtech Private Limited. The suspension follows ICRA's inability to carry out a rating surveillance in the absence of the requisite information from the company. TRIVENI SILK: ICRA Suspends B+ Rating on INR10.50cr Bank Loan ------------------------------------------------------------- ICRA has suspended long term Rating of [ICRA]B+ assigned to the INR10.50 Crore bank lines of Triveni Silk Mills. The suspension follows ICRA's inability to carry out a rating surveillance in the absence of the requisite information from the company. Triveni Silk Mills (TSM), a partnership firm established in 1990 is managed by Mr. Bhupinder Jaggi and Mr. Shakti Jaggi. The firm is engaged in the production of cotton and synthetic fabrics which is used in making ladies suits, dress materials, shawls, etc. The firm's manufacturing unit is located in Ludhiana and comprises of 7 looms, 30 embroidery machines and 4 printing machine. TURBO TECH: ICRA Suspends B- Rating on INR4cr Loan -------------------------------------------------- ICRA has suspended the [ICRA]B- rating assigned to the INR4.00 crore long-term fund-based facility and [ICRA]A4 rating assigned to the INR3.50 crore short-term non-fund based facilities of Turbo Tech Precision Engineering Private Limited. The suspension follows ICRA's inability to carry out a rating surveillance in the absence of the requisite information from the company. V.P.S. TEXTILES: ICRA Assigns 'D' Rating to INR4.46cr Loan ---------------------------------------------------------- ICRA has assigned a long-term rating of [ICRA]D to the INR0.54 crore term loan facility and the INR3.00 crore fund based facilities of V.P.S. Textiles (India) Private Limited. ICRA has also assigned a long term / short-term rating of [ICRA]D to the INR4.46 crore proposed facilities of VPS. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term Loan Facilities 0.54 [ICRA]D/Assigned Long Term Fund based facilities 3.00 [ICRA]D/Assigned Short term/Long Term- Unallocated Limits 4.46 [ICRA]D/Assigned The assigned ratings reflect the delays witnessed in servicing the debt obligations by the company, owing to its stressed liquidity position. The company's scale of operations remains small which restricts the benefits from economies of scale and the presence in the highly commoditized market with intense competition inhibits its pricing flexibility, thereby exposing the margins to fluctuations in cotton and yarn prices. Cumulatively, these have led to a weak financial profile of the company characterized by thin margins, stretched capital structure and inadequate debt protection metrics. ICRA takes note of the experience of promoters in the textile industry and the efforts taken by them to increase the scale of operations, although the results remain to be seen. Early regularisation of debt servicing is critical and remains the key rating sensitivity. V.P.S. Textiles (India) Private Limited, established in the year 2006 is engaged in the manufacture of cotton yarn in the count range of 40's to 60's. The company's manufacturing facility is located in R. Vadipatti (Tamil Nadu) with an installed capacity of 11616 spindles. VPS sells its produce majorly in the markets of Malegoan, Berhampur etc mostly through agents. Recent Results The company reported a net profit of INR0.03 crore on an operating income of INR8.82 crore during 2014-15 as against a net loss of INR(0.11) crore on an operating income of INR9.67 crore during 2013-14. VIRENDER SINGH: ICRA Suspends B+ Rating on INR7.0cr Bank Loan ------------------------------------------------------------- ICRA has suspended the long term rating of [ICRA]B+ assigned to the INR7.00 crore bank facilities of Virender Singh Harinder Singh. 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. WEBFIL LIMITED: ICRA Reaffirms 'C+' Rating on INR3.38cr Loan ------------------------------------------------------------ ICRA has reaffirmed the [ICRA]C+ rating of INR3.38 crore fund- based cash credit facility and INR10.30 crore non-fund based bank facilities of Webfil Limited. ICRA has reaffirmed the [ICRA]A4 rating to the non-fund based facilities, which are also rated on the short-term scale. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Cash Credit 3.38 [ICRA]C+ reaffirmed Letter of Credit 5.40 [ICRA]C+/A4 reaffirmed Bank Guarantee 4.90 [ICRA]C+/A4 reaffirmed The reaffirmation of the ratings takes into account the irregularities in payment of interest on the remaining loans taken from the West Bengal Industrial Development Corporation (WBIDC) and the Government of West Bengal (GoWB). Besides, the capital structure of the company is extremely weak due to its huge accumulated losses and large accumulated inventory, which is ageing. If written off, the same might result in additional losses. The ratings are also constrained by low net profitability of the company due to high employee expense and high interest expense. The ratings, however, derive support from the fact that the company is a part of the Andrew Yule group and that WBIDC holds a substantial stake in the company. ICRA also takes note of the strong order book position of the company, which provides revenue visibility in the near term. Besides, the strong research and development capability of the company helped it develop digital products for the domestic market that carries a high margin. WL was incorporated in 1979 as a joint venture company of West Bengal Infrastructure Development Corporation Limited and the Andrew Yule group. The company manufactures tungsten filament wires used in luminaries and digital products, which in turn is primarily used in communication and surveillance services. Recent Results During FY2016, WL reported a profit after tax (PAT) of INR0.05 crore (provisional) on an operating income (OI) of INR25.92 crore (provisional) compared to a PAT of INR2.63 crore on an OI of INR26.14 crore in FY2015. ==================== N E W Z E A L A N D ==================== POSTIE PLUS: Liquidator Cuts NZ$550K Deal With Former Supplier ------------------------------------------------------------ BusinessDesk reports that the liquidator of Postie Plus' former owner reached a NZ$550,000 settlement with the failed retailer's former logistics supplier, leaving creditor Bank of New Zealand facing a shortfall of more than NZ$5 million. In the final liquidators' report for Retva Ltd, the remaining shell of Postie Plus Group, PwC's David Bridgman said a "full and final" settlement was concluded in April 2016, ending proceedings brought by the retailer's secured creditor. BNZ had funded the initial legal proceedings against the third party supplier, but would have needed third party litigation funding to pursue the claim further, according to BusinessDesk. "The liquidators explored funding options and took this, and a number of other factors, into account in reaching the settlement, including consideration of the merits of the claim, the time and cost of taking the matter to a full court trial and the risks associated with ongoing litigation," BusinessDesk quotes Mr. Bridgman as saying in his report. BNZ was owed NZ$6 million at the time of liquidation and received NZ$298,000 as a distribution, implying it was still owed about NZ$5.7 million. The liquidators' fees and disbursements totalled NZ$166,000, while legal fees were NZ$65,000, BusinessDesk discloses. Postie Plus appointed PwC's Bridgman and Colin McCloy as voluntary administrators in June 2014 after losing the support of its lenders when it failed to recapitalise the business. BusinessDesk relates that the company had been hit by supply chain disruptions in 2012 and 2013 when it outsourced its distribution centre to Kuehne + Nagel, while shifting its headquarters to Auckland. Kuehne + Nagel was never formally named as the party being pursued in the courts. According to BusinessDesk, the retail business was sold as a going concern to South Africa's Pepkor for NZ$7.1 million which more than halved BNZ's outstanding loan of NZ$13.7 million and repaid other preferential creditors. After that, liquidators were appointed in September 2014. BusinessDesk relates that PwC's Bridgman said the shortfall to BNZ as the secured creditor meant unsecured creditors owed NZ$6.7 million were also left out of pocket. The liquidators have requested the company be removed from the register, adds BusinessDesk. Postie Plus Group Limited (NZE:PPG) -- http://www.ppgl.co.nz/-- comprises the retail businesses of Postie+, Baby City and Arbuckles. The company offers a range of products for all age groups. Postie+ sells casual family clothing through a chain of 79 stores. Colin McCloy and David Bridgman, Partners from PricewaterhouseCoopers, were appointed Administrators to Postie Plus Group Limited on June 3, 2014. The business is now in voluntary administration. Postie Plus has 64 retail stores located throughout New Zealand. ==================== S O U T H K O R E A ==================== DOOSAN BOBCAT: Moody's Assigns B1 CFR; Outlook Stable ----------------------------------------------------- Moody's Investors Service has assigned a B1 corporate family rating to Doosan Bobcat Inc. (DBI). The rating outlook is stable. At the same time, Moody's has withdrawn the B1 CFR of DBI's subsidiary, Doosan Infracore International, Inc. (DII), because DII's merger with its 100% owned subsidiary, Clark Equipment Company (CEC, unrated) was completed on June 30, 2016, with CEC as the surviving entity. Moody's has also affirmed the Ba3 rating on the $1.06 billion senior secured term loan co-borrowed by DII and Doosan Holdings Europe Limited (DHEL, unrated). DII's obligation has been assumed by CEC following the completion of the merger process. CEC and DHEL are co-borrowers on a joint and several basis for the senior secured term loan. Accordingly, the rating on the senior secured term loan is based on the credit quality of their parent DBI, which broadly reflects in turn the combined financials of the co-borrowers. RATINGS RATIONALE "DBI's B1 CFR primarily reflects its dominant position in the compact farm and construction equipment market in North America, as well as its good ability to generate positive free cash flow over the next 1-2 years," says Wan Hee Yoo, a Moody's Vice President and Senior Analyst. "However, the CFR is constrained by the company's moderate scale, high product concentration and the highly cyclical nature of the compact farm and construction equipment industry," adds Yoo. Moody's expects that DBI's adjusted debt/EBITDA will improve to about 3.3x-3.5x over the next 12-18 months from 4.0x in 2015, mainly driven by debt redemptions that occurred in 1H 2016, as well as the company's moderate growth in earnings. While this level of financial leverage is strong for its B1 CFR, DBI's rating is partly constrained by its parent, Doosan Infracore Co Ltd (DI, unrated), given that DI's overall credit profile is not as strong as that of DBI, and DI exerts full control over DBI and DBI's subsidiaries. Nevertheless, this drag on DBI's rating is partly mitigated by the following factors: (1) the covenant package in the senior secured term loan limits the risk of credit contagion and potential cash leakage to the parent; (2) DBI's limited dependence on its parent for its operations; and (3) DI's strong commitment to ensure that DBI maintains a viable standalone credit profile. The merger between DII and CEC will not affect the rating of the senior secured term loan, given the minimal impact of the merger on the companies' capital structure and financials. Moody's points out that according to DII, the purpose of the merger was to simplify the ownership structure to enhance operating efficiency. The Ba3 rating on the $1.06 billion senior secured term loan mainly reflects the first lien -- except for those assets secured by the first lien for the revolver -- on substantially all of the assets and capital stock of the co-borrowers, their parent DBI, as well as their subsidiaries. This structure means that the facility ranks ahead of most other debt and liabilities. The stable rating outlook reflects Moody's expectation that DBI's financial profile will gradually improve and that the company will maintain its robust market positions in its core businesses over the next 12-18 months. Upward pressure on the ratings could arise over time if: (1) DBI's financial profile improves through enhanced earnings, as well as the prudent management of its investments, such that its adjusted debt/EBITDA stays below 3.5x and retained cash flow (RCF)/adjusted net debt exceeds 20%-22% on a sustained basis; and (2) DI's credit quality improves considerably, or if there is a meaningful decline in DI's ownership stake in DBI. On the other hand, the ratings could be downgraded if DBI's profitability and cash flow remain weak, such that its adjusted debt/EBITDA exceeds 5.0x and RCF/adjusted net debt stays below 12%-13% on a sustained basis. The ratings could also be pressured if DI extracts large amounts of cash from DBI, and if DI's credit quality deteriorates considerably. The principal methodology used in this rating was Global Manufacturing Companies published in July 2014. Doosan Bobcat Inc. is the leading manufacturers of compact farm and construction equipment in North America and EMEA. It engages in the design, manufacture, sale and service of compact farm and construction equipment under the Bobcat brand and portable power products. It also distributes heavy construction equipment produced by its parent Doosan Infracore Co Ltd. ********* 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 ***