/raid1/www/Hosts/bankrupt/TCRAP

/raid1/www/Hosts/bankrupt/TCRAP_Public/170626.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 Monday, June 26, 2017, Vol. 20, No. 125 Headlines A U S T R A L I A ALINTA ENERGY: Moody's Assigns Ba1 Corporate Family Rating BLOOMER CONSTRUCTIONS: Second Creditors' Meeting Set for June 28 CAREERS AUSTRALIA: Second Creditors' Meeting Set for June 30 JENNARDS PORT: First Creditors' Meeting Set for July 3 M & M BUILDING: Second Creditors' Meeting Set for July 3 NUON PTY: First Creditors' Meeting Set for July 4 PROJECT RECYCLING: First Creditors' Meeting Set for July 3 QUINTIS LTD: S&P Cuts CCR to 'CCC-' on Increased Liquidity Stress TEN NETWORK: Creditors-Only Meeting Set Today, June 26 TRITON TRUST 2014-P: Fitch Raises Rating on Cl. E Notes to BB+ C H I N A CHINA LOGISTICS: Fitch Assigns B Long-Term IDR; Outlook Stable QINGHAI PROVINCIAL: S&P Assigns 'BB-' Rating to Proposed Notes SHIMAO PROPERTY: USD Bond Offer No Impact on Moody's Ba2 CFR SHIMAO PROPERTY: S&P Assigns 'BB' Rating to Proposed US$ Notes SPI ENERGY: Seeking to List Ordinary Shares on Nasdaq H O N G K O N G NOBLE GROUP: Attracts Goldilocks as New Major Holder I N D I A AADYA MOTOR: CRISIL Reaffirms 'D' Rating on INR20MM Loan AARVEE INTERNATIONAL: CRISIL Cuts Rating on INR18MM Loan to 'D' ASIAN THAI: CRISIL Reaffirms 'B' Rating on INR10MM LT Loan BABA BEARINGS: CRISIL Cuts Rating on INR2.64MM Loan to 'B' BRAHMANAND HIMGHAR: CRISIL Reaffirms B+ Rating on INR10MM Loan CARITAS HEALTHCARE: CRISIL Reaffirms B+ Rating on INR6MM Loan DERON PROPERTIES: CRISIL Assigns B+ Rating to INR25MM Term Loan DRASHTI INNOVATIVE: CRISIL Reaffirms D Rating on INR10.13MM Loan GAURI INTERNATIONAL: CRISIL Reaffirms D Rating on INR15MM Loan GK-AUTOPAL LIGHTING: CRISIL Reaffirms B Rating on INR5MM Loan GOUTHAMI HATCHERIES: CRISIL Reaffirms D Rating on INR16.5MM Loan GOYAL SONS: CRISIL Cuts Rating on INR2MM Cash Loan to 'B' GRAND HYUNDAI: CRISIL Reaffirms B+ Rating on INR9.2MM Loan GRAND MOTORS: CRISIL Reaffirms 'B' Rating on INR3.5MM Cash Loan JHUNJHUNWALA OIL: CRISIL Reaffirms D Rating on INR33MM Cash Loan JUMBO BAG: CRISIL Reaffirms B+ Rating on INR35.8MM Cash Loan K.T. MATHEW: CRISIL Reaffirms 'B' Rating on INR4MM Cash Loan KEWIN CHEMICALS: CRISIL Reaffirms B+ Rating on INR1.5MM Loan KUMARAGIRI SPINNERSS: CRISIL Cuts Rating on INR37.20MM Loan to B LEOFORTUNE INFRA: CRISIL Reaffirms D Rating on INR15MM Loan LOTUS INFRATECH: CRISIL Assigns 'B+' Rating to INR1.75MM Loan M.K. ROY: CRISIL Reaffirms 'B' Rating on INR5.42MM LT Loan METALLOY IMPEX: CRISIL Reaffirms 'B' Rating on INR8.25MM Loan MEWAR UNIVERSITY: CRISIL Reaffirms 'D' Rating on INR29.67MM Loan MOHAN GEMS: CRISIL Reaffirms D Rating on INR225MM Term Loan NOVA AGRI: CRISIL Assigns 'B' Rating to INR4MM Cash Loan ONE STOP ENTERTAINMENT: CRISIL Reaffirms 'B' on INR8MM Term Loan ORISSA DIESEL: CRISIL Reaffirms B+ Rating on INR3.12MM Loan PANDA INFRAPROJECT: CRISIL Reaffirms B Rating on INR15MM Loan PRACHIN FOUNDATION: CRISIL Reaffirms 'D' Rating on INR7.09MM Loan R T EXPORTS: CRISIL Reaffirms 'D' Rating on INR14.95MM Term Loan RAGHAV COTSPIN: CRISIL Reaffirms 'B' Rating on INR22MM Loan RAJPAL CARGO: CRISIL Reaffirms B+ Rating on INR5MM Cash Loan RAM MEHER: CRISIL Reaffirms B+ Rating on INR5.1MM LT Loan SAAKAAR CONSTRUCTIONS: CRISIL Reaffirms B Rating on INR5MM Loan SATYA JEWELLERS: CRISIL Reaffirms B Rating on INR3MM Cash Loan SHIVA GRAMODYOG: CRISIL Reaffirms B Rating on INR2.5MM Loan SHRADDHA GEMS: CRISIL Reaffirms B+ Rating on INR2.25MM Loan SHREE VISHWAKARMA: CRISIL Reaffirms 'B' Rating on INR6MM Loan SHRI GURU: CRISIL Reaffirms 'B' Rating on INR5MM Cash Loan SHRI RAM: CRISIL Assigns B+ Rating to INR3.0MM LT Loan SRI VARALAKSHMI: CRISIL Reaffirms 'B' Rating on INR2.65MM Loan SUNRISE PROCESS: CRISIL Reaffirms B Rating on INR3MM Cash Loan SURENDRA MINING: CRISIL Lowers Rating on INR55.2MM Term Loan to B SUVILAS PROPERTIES: CRISIL Reaffirms 'B' Rating on INR35MM Loan VINAYAK MINERALS: CRISIL Reaffirms B Rating on INR3MM Term Loan J A P A N TAKATA: Bankruptcy Would Cloud Auto Industry's Biggest Recall TOSHIBA CORP: Demoted to Tokyo Exchange's Second Tier TOSHIBA CORP: Chip Unit Deal 'Not Finished', SK Chairman Says M O N G O L I A GOLOMT BANK: S&P Affirms 'B-' ICR; Outlook Revised to Stable S O U T H K O R E A MAGNACHIP SEMICONDUCTOR: S&P Raises CCR to 'B-'; Outlook Stable SK HYNIX: Moody's Says Toshiba Deal May Cut Financial Flexibility - - - - - ================= A U S T R A L I A ================= ALINTA ENERGY: Moody's Assigns Ba1 Corporate Family Rating ---------------------------------------------------------- Moody's Investors Service has assigned a Ba1 corporate family rating to Alinta Energy Limited, which is the newly established holding company of the Alinta group and will issue debt on behalf of the group. The outlook on the rating is stable. At the same time, Moody's has withdrawn the Ba3 corporate family rating with a developing outlook previously assigned to Alinta Holdings. RATINGS RATIONALE Alinta's Ba1 rating considers the company's financial metrics (based on Moody's central scenario of the company issuing senior debt of up to AUD1 billion over the next 12-18 months), the evolving nature of its core energy markets, and the absence of a track record under the new owner. Moody's understands that Alinta currently has no material finance debt outstanding, following the repayment of the latter from shareholder capital, after the group was acquired by Chow Tai Fook Enterprises Limited (CTFE, unrated) in April 2017. CTFE is a privately held diversified conglomerate based in Hong Kong, with investments in property development, hotel accommodation and various private equity interests. Based on this central scenario, Moody's expects that Alinta's financial leverage - as measured by funds from operations (FFO)/debt - will remain above 30%, and its FFO/interest coverage around 7x, which represents a material strengthening compared to the previous financing structure. "The Ba1 rating balances the likely strengthening in Alinta's financial metrics, against the challenges facing the company, particularly the increasing competition in its core Western Australian gas retail business, its exposure to mining counterparties under its power purchase agreements and the challenges in the national electricity market," says Spencer Ng, a Moody's Vice President and Senior Analyst. The Ba1 rating reflects the absence of a track record under the new owner, as well as the possibility of future material acquisitions, which could increase financial leverage and/or the company's business risk. Moody's notes that the company is reportedly interested in bidding for Loy Yang B, a 1,050 MW coal- fired generator in Victoria. Furthermore, in addition to existing competition from Kleenheat -- which is a subsidiary of Wesfarmers Ltd (A3 stable) -- AGL Energy Ltd (Baa2 stable) and Origin Energy Limited (Baa3 negative) -- which are large vertically integrated utilities operating in Australia's east coast - have also announced plans to enter the Western Australian gas retail market. Consequently, the ability of the company to manage the challenges in the operating environment and visibility over the company's acquisition strategy under new ownership will be key rating drivers. The Ba1 rating recognizes Alinta's track record of implementing operating improvements and generally meeting or exceeding financial projections over recent years under the previous owners, as well as the average 10-year term of its contracted assets portfolio. These factors increase the likelihood of resilient earnings absent a material weakening in counterparty credit quality. "We believe Alinta in its current form has a manageable exposure to carbon transition risk in the energy market, particularly because most of its revenue is generated from gas, which is a lower emission fuel source," adds Ng. Alinta's Ba1 rating could be upgraded, if the group's future financial performance is consistent with Moody's central scenario, and there is no deterioration in its business risk profile. In particular, Moody's would consider upgrading the rating if, for example, Alinta's FFO/debt exceeds 30%, and its FFO/interest coverage stays above 5x on a consistent basis. On the other hand, Alinta's rating could experience downward pressure, if Moody's expects a material deterioration in its financial metrics, as indicated by FFO/debt falling below 20%, and/or interest cover below 3.5x on a sustained basis, and/or if there is a material increase in the company's business risk. Such an increase could result from a material weakening in the credit quality of key counterparties, larger-than-expected churn and discounting in the Western Australian gas market, and/or adverse regulatory developments. The principal methodology used in this rating was Unregulated Utilities and Unregulated Power Companies published in May 2017. Alinta Energy Limited is an energy retailer based in Australia, with a gas and electricity retail presence in Western Australia, and to a lesser extent, in the east coast national electricity market. The company serves around 800,000 customers. It owns and operates six intermediate or peaking power stations across the country, and a single power station in New Zealand. The company's generation fleet has a combined generation capacity of around 2,000 MW. BLOOMER CONSTRUCTIONS: Second Creditors' Meeting Set for June 28 ---------------------------------------------------------------- A second meeting of creditors in the proceedings of Bloomer Constructions (QLD) Pty Ltd has been set for June 28, 2017, at 11:00 a.m., at the offices of Cliftons Brisbane, Level 2, 288 Edward Street, in Brisbane, Queensland. The purpose of the meeting are (1) to receive the report by the Administrator about the business, property, affairs and financial circumstances of the Company; and (2) for the creditors of the Company to resolve whether the Company will execute a deed of company arrangement, the administration should end, or the Company be wound up. Creditors wishing to attend are advised proofs and proxies should be submitted to the Administrator by June 27, 2017, at 4:00 p.m. Trent Andrew Devine & Sule Arnautovic of Cliftons Brisbane were appointed as administrators of Bloomer Constructions on April 26, 2017. CAREERS AUSTRALIA: Second Creditors' Meeting Set for June 30 ------------------------------------------------------------ A second meeting of creditors in the proceedings of: - Careers Australia Group Limited; - Careers Australia Education Institute Pty Ltd; - Australian School of Management Pty Ltd; - Careers Australia Institute of Training Pty Ltd; - Australian College of Applied Education Pty Ltd; and - M & M Building Pty Ltd has been set for June 30, 2017, at 10:00 a.m., at Brisbane Convention & Exhibition Centre, Cnr Merivale & Glenelg Streets, South Bank, in Brisbane, Queensland. The purpose of the meeting are (1) to receive the report by the Administrator about the business, property, affairs and financial circumstances of the Company; and (2) for the creditors of the Company to resolve whether the Company will execute a deed of company arrangement, the administration should end, or the Company be wound up. Creditors wishing to attend are advised proofs and proxies should be submitted to the Administrator by June 29, 2017, at 4:00 p.m. David Laurence McEvoy of PPB Advisory was appointed as administrator of Careers Australia et al. on May 25, 2017. JENNARDS PORT: First Creditors' Meeting Set for July 3 ------------------------------------------------------ A first meeting of the creditors in the proceedings of Jennards Port Macquarie Pty Ltd, trading as "Clark Rubber Port Macquarie" and "Port Macquarie Clark Rubber", will be held at the offices of Deloitte Financial Advisory Pty Ltd, at Level 19, Eclipse Tower, 60 Station Street, in Parramatta, NSW, on July 3, 2017, at 11:00 a.m. Neil Robert Cussen and Michael James Billingsley of Deloitte Financial were appointed as administrators of Jennards Port on June 21, 2017. M & M BUILDING: Second Creditors' Meeting Set for July 3 -------------------------------------------------------- A second meeting of creditors in the proceedings of M & M Building Pty Ltd has been set for July 3, 2017, at 11:00 a.m., at the offices of Cor Cordis Chartered Accountants, One Wharf Lane Level 20, 161 Sussex Street, in Sydney. The purpose of the meeting are (1) to receive the report by the Administrator about the business, property, affairs and financial circumstances of the Company; and (2) for the creditors of the Company to resolve whether the Company will execute a deed of company arrangement, the administration should end, or the Company be wound up. Creditors wishing to attend are advised proofs and proxies should be submitted to the Administrator by June 30, 2017, at 4:00 p.m. Jason Tang & Ozem Kassem of Cor Cordis were appointed as administrators of M & M Building on May 26, 2017. NUON PTY: First Creditors' Meeting Set for July 4 ------------------------------------------------- A first meeting of the creditors in the proceedings of Nuon Pty Ltd and Nuon IP Pty Ltd will be held at the offices of Chartered Accountants Australia and New Zealand, at Level 18 Bourke Place, in Melbourne, Victoria, on July 4, 2017, at 11:00 a.m. Craig Crosbie and Robert Ditrich of PPB Advisory were appointed as administrators of Nuon Pty on June 22, 2017. PROJECT RECYCLING: First Creditors' Meeting Set for July 3 ---------------------------------------------------------- A first meeting of the creditors in the proceedings of Project Recycling Pty. Ltd., trading As "ACT Paper & Cardboard Recycling" and "MR. Skippy Bins", will be held at the Boardroom of Chifley Advisory, Suite 3.04, Level 3, 39 Martin Place, in Sydney, NSW, at July 3, 2017, at 3:00 p.m. Gavin Moss and Trent McMillen of Chifley Advisory were appointed as administrators of Project Recycling on June 23, 2017. QUINTIS LTD: S&P Cuts CCR to 'CCC-' on Increased Liquidity Stress ----------------------------------------------------------------- S&P Global Ratings lowered its corporate credit rating on Australia-based sandalwood producer Quintis Ltd. and issue ratings on the company's senior secured notes to 'CCC-' from 'CCC+'. The recovery rating on the notes remains unchanged at '4'. At the same time, S&P placed the ratings on CreditWatch with negative implications. S&P has lowered the ratings on Quintis because the company's liquidity pressure has increased pending an upcoming interest payment due on its bonds on Aug. 1, 2017, and the potential for a put option to be exercised in July 2017. In addition, further delays in the sales of Quintis' Indian sandalwood, lower investor cash flows, and a lack of clarity regarding any potential capital support have increased the company's liquidity risk. In S&P's view, the continued uncertainty regarding wood sales and cancellation of managed investment schemes (MIS) mean that without a sale of Indian sandalwood or capital injection, the company faces acute liquidity pressure. This creates significant uncertainty around the approximately US$13 million interest payment on the outstanding senior secured bonds due at the beginning of August. In addition, the prospect of a A$37 million put option being exercised in July 2017 could accelerate any liquidity event. Nevertheless, the company has announced an approach from more than one party regarding potential corporate transactions to provide capital support. S&P will consider the impact on the rating should any offer materialize. At this stage, S&P's view of the rating captures Quintis' current business conditions and the impact on the company's liquidity position. S&P will resolve the CreditWatch either by Aug. 1, 2017, when the bond interest payment is due, or prior to this date after S&P's assessment on the completion of a potential recapitalization or sandalwood sales to China. TEN NETWORK: Creditors-Only Meeting Set Today, June 26 ------------------------------------------------------ Christian Edwards at the Australian Associated Press reports that creditors of the Ten Network will gather for the first time next week to meet with the newly appointed administrators and discuss possible futures for the embattled broadcaster. The first meeting of the Ten Network's creditors will be held at the Sofitel Hotel in Sydney today, June 26, the report discloses. According to the AAP, the creditors-only meeting follows the third-ranking free-to-air network's failure to secure a new debt facility and its consequent slide into voluntary administration on June 14. After calling for refinancing or sale options with advertisements in national newspapers last week, administrators KordaMentha have drawn criticism from the Australian Shareholders' Association, which is angry that shareholders and media are barred from the meeting, AAP says. AAP relates that a spokesperson for KordaMentha said the administrators will provide creditors with an overview of the administration process so far and creditors will vote to appoint a committee of creditors and on whether the administrators should continue in their role. According to the report, lead administrator Mark Korda told the ASA on June 23 that only registered creditors would be admitted into the meeting in Sydney. However, Network Ten journalists, in their capacity as creditor employees will be admitted, the spokesperson said. AAP relates that ASA director Allan Goldin said the move was disappointing and that the ASA, as the peak body for Ten's 17,000 small shareholders, should be given access. "Since the administrators were appointed, Ten's own news services have been talking up the likelihood of the company regaining its listing, so with this in mind we were keen to be represented on the creditors' committee but now won't be able to put that proposition," the report quotes Mr. Goldin as saying. The ASA will instead be briefed by Mr Korda after the meeting, the report says. A second meeting will be held within 25 days for the administrator to provide a defined strategy to creditors, the AAP relates. AAP notes that the Ten Network called in the administrators after it became clear two key backers -- billionaire shareholders Lachlan Murdoch and Bruce Gordon -- would not extend their guarantee on the network's AUD200 million debt facility to a new, AUD250 million facility needed by December. Messrs. Murdoch and Gordon, who hold 7.7% and 15% of Ten, through their respective private investment companies Illyria and Birketu have combined their voting power and are working together on a plan to restructure or repay Ten's debt, according to the AAP. The two are not expected to attend today's meeting, the AAP notes. Following speculation that Messrs. Murdoch and Gordon could emerge as possible buyers should Ten go into liquidation, the network's fall has renewed concerns around Australian media ownership laws and that "business as usual" at Channel Ten -- as the administrator has pledged -- may not be an option, the report states. Ten shares are suspended from the ASX, having last traded at 16 cents, adds AAP. As reported in the Troubled Company Reporter-Asia Pacific on June 15, 2017, KordaMentha Restructuring partners Mark Korda, Jenny Nettleton and Jarrod Villani have been appointed voluntary administrators to Network Ten. "Network Ten will continue to operate under its existing management and operating structures with KordaMentha oversight. Customers, employees and other stakeholders are assured that the administrators intend to keep the business running. Viewers can expect the same content they currently enjoy on Network Ten," KordaMentha said in a statement. The appointment will allow the voluntary administrators to explore options for the recapitalisation or sale of Network Ten. Australia-based Ten Network Holdings Limited (ASX:TEN) -- http://tenplay.com.au/corporate-- is engaged in the investment in The Ten Group Pty Limited and controlled entities, whose principal activities are the operation of multichannel commercial television licenses in Sydney, Melbourne, Brisbane, Adelaide and Perth, and out-of-home advertising in the United States of America. The Company is engaged in two segments which includes Television and Out-of-Home (Roads and Maritime Services contract (RMS) and Eye US operations). The Company includes three free-to- air television channels, TEN, ELEVEN and ONE, in Sydney, Melbourne, Brisbane, Adelaide and Perth, plus the digital platform tenplay. TRITON TRUST 2014-P: Fitch Raises Rating on Cl. E Notes to BB+ -------------------------------------------------------------- Fitch Ratings has upgraded four tranches from Triton Trust No. 2 Bond Series 2014-P and affirmed 13 tranches of five Triton Trust RMBS transactions. These transactions are backed by pools of Australian residential mortgages. The notes have been issued by Perpetual Corporate Trust Limited, in its capacity as trustee. KEY RATING DRIVERS The upgrades to the class B, C, D and E notes of Triton 2014-P reflects the build-up of credit enhancement sufficient to achieve higher ratings. Concentration, based on pool composition, constrains the class E notes due to tail risk as the transaction gets smaller. The affirmations reflect Fitch's view that available credit enhancement is sufficient to support the notes' current ratings and the agency's expectations of Australia's economic conditions. Credit quality and performance of the underlying loans remain within Fitch's expectations. At end-April 2017, Triton 2014-P had the highest level of arrears, at 4.6%; above Fitch's 4Q16 Dinkum RMBS Index of 1.1%. Low- documentation loans made up 24.1% of the pool. The pool had an average loan/value ratio (LVR) of 64.3% and an indexed LVR of 51.3%. Interest-only loans accounted for 19.8% of the pool by balance and investment loans made up 52.9%. Lenders' mortgage insurance (LMI) covered 18.5% of the pool and was provided by Genworth Financial Mortgage Insurance Pty Limited (Insurer Financial Strength Rating: A+/Stable) and QBE Lenders' Mortgage Insurance Limited (Insurer Financial Strength Rating: AA-/Stable). At end-April 2017, Triton Trust No. 2 Bond Series 2013-1, Triton Trust No.7 Bond Series 2015-1 and Triton Trust No.7 Bond Series 2016-1 had arrears levels below Fitch's 4Q16 Dinkum RMBS Index, while Triton Trust No.2 Bond Series 2014-1 had 30+ days arrears of 1.2%. The transactions have performed within Fitch's expectations, with only Triton 2013-1 and Triton 2014-P experiencing losses since closing, resulting in zero losses across the outstanding Fitch- rated notes. All losses were covered by LMI or excess spread. The default model was not re-run for Triton 2013-1, Triton 2014-1 and Triton 2016-1, as the outstanding ratings were all 'AAAsf', the transactions did not have revolving periods and a review of pre-determined performance triggers indicated that the transaction displayed stable asset performance. Triton 2015-1 has a two-year revolving period, which ends in January 2018. The transaction includes rating and performance triggers to mitigate portfolio deterioration. RATING SENSITIVITIES The ratings are not expected to be affected by any foreseeable change in performance. Pro rata amortisation will switch to sequential when call-option triggers are met, mitigating tail risk. The ratings of class AB notes of Triton 2014-1 Trust and class B and C notes of Triton 2015-1 are LMI dependent. The remaining notes are independent of downgrade to the LMI providers' ratings. Full list of rating actions with balances as at end-April 2017: Triton Trust No. 2 Bond Series 2013-1: - AUD130.8 million Class A notes affirmed at 'AAAsf'; Outlook Stable - AUD20.6 million Class AB notes affirmed at 'AAAsf'; Outlook Stable Triton Trust No.2 Bond Series 2014-P: - AUD46.5 million Class A1 notes affirmed at 'AAAsf'; Outlook Stable - AUD10.5 million Class A2 notes affirmed at 'AAAsf'; Outlook Stable - AUD3.1 million Class B notes upgraded to 'AAAsf' from 'AAsf'; Outlook Stable - AUD2.3 million Class C notes upgraded to 'AAsf' from 'Asf'; Outlook Stable - AUD2.9 million Class D notes upgraded to 'Asf' from 'BBBsf'; Outlook Stable - AUD3.7 million Class E notes upgraded to 'BB+sf' from 'BBsf'; Outlook Stable Triton Trust No.2 Bond Series 2014-1: - AUD199.1 million Class A notes affirmed at 'AAAsf'; Outlook Stable - AUD28.5 million Class AB notes affirmed at 'AAAsf'; Outlook Stable Triton Trust No.7 Bond Series 2015-1: - AUD450.0 million Class A1 notes affirmed at 'AAAsf'; Outlook Stable - AUD0.0 million Class A2 notes affirmed at 'AAAsf'; Outlook Stable - AUD28.1 million Class B notes affirmed at 'AAsf'; Outlook Stable - AUD10.1 million Class C notes affirmed at 'BBBsf'; Outlook Stable Triton Trust No.7 Bond Series 2016-1: - AUD222.5 million Class A1-b notes affirmed at 'AAAsf'; Outlook Stable - AUD22.8 million Class A2 notes affirmed at 'AAAsf'; Outlook Stable - AUD11.4 million Class AB notes affirmed at 'AAAsf'; Outlook Stable ========= C H I N A ========= CHINA LOGISTICS: Fitch Assigns B Long-Term IDR; Outlook Stable -------------------------------------------------------------- Fitch Ratings has assigned China-based high-standard warehouse owner China Logistics Property Holdings Co., Ltd's (CNLP) Long- Term Foreign-Currency Issuer Default Rating at 'B' with a Stable Outlook. Fitch has also assigned CNLP's senior unsecured rating at 'B', with a Recovery Rating of 'RR4'. CNLP's ratings are supported by the strong industry demand for high-standard warehouses, the company's national geographic coverage and its extensive network. CNLP will also benefit from its advantage in China's Yangtze-River-Delta (YRD) region, being one of the largest logistic-property owners in the area. However, its ratings are constrained by small scale, low interest coverage of below 1.0x at 0.57x in 2016, and continuing funding demand for capex. CNLP's reliance on debt for this expansion indicates its limited financial flexibility, and is therefore a further constraint to its rating. KEY RATING DRIVERS Growing Industry, Regional Imbalance: China's high-standard warehouse industry is still underdeveloped. This presents enormous potential, accounting for only 2%-3% of total warehouse supply of around 1 billion square metres (sqm) as of end-2015 - in sharp contrast to a penetration rate of over 20% in the US. The industry has been growing rapidly over the past decade, driven by compound annual growth rate (CAGR) growth of over 40% in the e-commerce sector in 2011-2015. E-commerce (including related third-party logistics, or 3PLs) is likely to comprise 50% of the new warehouse demand in 2017, according to CBRE Research. Nevertheless, the favourable industry outlook and higher investment return have attracted so many new entrants that some Tier 2 cities in China started to show signs of overcapacity in 2016, especially in western China such as Chengdu, Chongqing and Wuhan. On the other hand, Fitch expects Tier 1 city rents to hold firm and enjoy 3%-6% rent reversion due to limited land supply. Fitch is likely to see rent divergence in different cities and some weakness in the rental growth of lower-tier cities in 2017. Strong Network Effect, YRD-Focused: CNLP is one of the top 10 high-standard warehouse owners in China, with more than 2 million sqm of completed logistic properties. CNLP is relatively stronger in the YRD, with 30%-40% completed gross floor area (GFA) concentrated in Zhejiang and Jiangsu provinces - of which Suzhou alone accounts for 20%-30%. JD.com is the largest customer and contributed 31% of CNLP's total revenue in 2016; 34% of the GFA completed is occupied by multi-location tenants. The market competition will continue to be intense, although Fitch believes that the industry will be increasingly dominated by large players with a strong network and solid customer relationships. Small Scale, Declining Occupancy Rate: CNLP had recurring EBITDA of USD17 million in 2016, much smaller than the industry leader Global Logistic Properties Limited's (BBB+/Stable) EBITDA USD772 million in the year ended March 2017. CNLP had a thin EBITDA margin of only 40% in 2016, due mainly to its small scale. The company is also facing a declining occupancy rate for its completed and 'stabilised' logistic assets, which dropped to 86.6% in 2016 from 97.3% in 2014. Judging by the relatively low occupancy rate of the 2016 new projects, Fitch expects the occupancy rate for stabilised assets to further decline in 2017, which will exert pressure on CNLP's EBITDA margin and pace of expansion. CNLP defines 'stabilised projects' as those in operation for more than 12 months or achieving a 90% occupancy rate. High Capex, Low Interest Coverage: CNLP's recurring EBITDA interest coverage was only 0.57x in 2016 (excluding all IPO- related expenses). Coverage may edge lower in 2017 because the interest payment will more than double after CNLP replaces all equity-like hybrid instruments with traditional debt funding, even if EBITDA doubles in 2017. Fitch expects coverage to rise to above 1x by end-2019 when more than 80% of CNLP's assets become stabilised. However, any significant changes in market demand/supply dynamics may delay the improvement in CNLP's interest coverage. Low Leverage: CNLP's LTV (net debt to investment property assets) was low at 26% at end 2016. However, Fitch expects the leverage headroom to be small as CNLP's unsecured assets/unsecured debt coverage was only 1.1x and will continue to hover around 1x in the next three years. CNLP had CNY1.5 billion in unpledged investment property at end-2016, while unsecured offshore debt amounted to CNY1.4 billion. DERIVATION SUMMARY CNLP's business profile is in line with the 'B+'/'BB-' category, but the recurring EBITDA interest coverage of only 0.6x is more in line with a 'B-' rating, which results in a final rating of 'B'. CNLP is still far away from 'BB-' rated peers such as Lai Fung Holdings Limited (BB-/Stable) with an interest coverage of 1.3x and better asset quality; and PT Pakuwon Jati Tbk (BB-/Positive) with an interest coverage of 2.5x, helped by its quality malls but constrained by its small scale and exposure to development property. CNLP's financials are weaker than PT Kawasan Industri Jababeka Tbk (KJIA, B+/Stable), whose recurring EBITDA is generated from its long-term electricity sales and purchase agreements with state- owned PT Perusahaan Listrik Negara (PLN, BBB-/Positive), and the interest coverage hovers consistently above 1x with temporary disruption due to power plant repair work. However, CNLP is expanding faster than KIJA, driven by demand from China's fast- growing e-commerce industry. Fitch expects CNLP's financial profile to be closer to a 'B' rating in 2019-2020, depending on market conditions and the ramp-up of progress in CNLP's new projects. CNLP's weaker financial profile than other investment- property owners is also due to the logistic property sector's longer return period and CNLP's fast expansion. KEY ASSUMPTIONS Fitch's key assumptions within its ratings case for the issuer include: - Completed and stabilised assets-occupancy rate to edge down to 86% in 2017-2018 due to a lower occupancy rate for pre- stabilised assets. - Effective rent growth of 2% in 2017-2018. - Total completed net leasable area of 2.6 million sqm and 3.5 million sqm in 2017-2018. - EBITDA margin to improve to 49% in 2017 and 59% in 2018. RATING SENSITIVITIES Future Developments That May, Individually or Collectively, Lead to Positive Rating Action - Stable occupancy rate for completed and stabilised assets above 80% - Recurring EBITDA/interest coverage sustained above 1.2x - Net debt/recurring EBITDA sustained below 10x (2016: 27.8x) Future Developments That May, Individually or Collectively, Lead to Negative Rating Action - Recurring EBITDA/interest coverage fails to improve significantly - Inability to secure funding for expansion or deterioration in liquidity - Weakening of business profile that would be reflected in a significant drop in occupancy rates or a sustained fall in rentals LIQUIDITY Weak Liquidity: CNLP had about CNY2 billion in cash equivalents as of end-2016 compared with CNY604 million of short-term debt. Liquidity is bolstered by CNY3 billion of equity proceeds from its IPO in June 2016. However, Fitch expects CNLP to rely on capital market debt, further equity placements, or to sell land to fund its CNY2 billion-3 billion capex per year over the next three years. QINGHAI PROVINCIAL: S&P Assigns 'BB-' Rating to Proposed Notes -------------------------------------------------------------- S&P Global Ratings assigned its 'BB-' long-term issue rating and 'cnBB+' long-term Greater China regional scale rating to Qinghai Provincial Investment Group Co. Ltd. (QPIG)'s proposed issue of U.S. dollar-denominated senior unsecured notes. The ratings are subject to S&P's review of the final issuance documentation. S&P's rating on the proposed senior unsecured notes is equalized to its issuer credit rating on QPIG because S&P expects the greater portion of this debt to be concentrated at the holding- company level after this bond issue, which will slightly reduce QPIG's ratio of priority debt to total assets to about 40%. In addition, the company's priority debt is diversified at its operational subsidiaries, and QPIG will downstream the proceeds to subsidiaries, which could reduce the structural subordination risk associated with debt at the holding-company level. S&P expects the China-based aluminum producer to use most of the proceeds to repay borrowings, with the rest slated for general corporate purposes. QPIG reduced its capital spending in 2016, and S&P anticipates that deleveraging measures will continue in 2017. In 2016, QPIG recorded higher-than-expected revenue growth, driven by a 12% increase in sales volume of primary aluminum, and a 3.7% increase in prices. However, margins narrowed due to high costs from the ramp-up of new aluminum production facilities. S&P expects that leverage will remain high for the next 12 months. In S&P's view, QPIG remains an important provincial state-owned enterprise in Qinghai province. At the end of 2016, the Qinghai provincial government extended a Chinese renminbi (RMB) 2.4 billion (US$356 million) capital injection, which raised the government's aggregate equity share in QPIG to 69.26% from 50.88%. This move reinforces our expectation that QPIG is highly likely to receive extraordinary government support in the event of distress. SHIMAO PROPERTY: USD Bond Offer No Impact on Moody's Ba2 CFR ------------------------------------------------------------ Moody's Investors Service said that Shimao Property Holdings Limited's Ba2 corporate family rating and Ba3 senior unsecured debt rating are unaffected by the company's announcement of a USD bond offering. The rating outlook remains stable. "The proposed bond issuance will have limited impact on the company's credit metrics, as the majority of the proceeds will be used to refinance its existing debt," says Franco Leung, a Moody's Vice President and Senior Credit Officer, also the Lead Analyst for Shimao. Moody's expects that following the bond issuance, Shimao's revenue/debt will be 76%-80% and its EBIT/interest coverage will be 3.3x-3.8x over the next 12-18 months. These credit metrics support its Ba2 corporate family rating. Shimao recorded a robust sales performance during the first five months of 2017, with contracted sales growing 39% year-on-year to RMB33.8 billion. Moody's estimates that the company is on track to achieve its annual target of RMB80 billion for 2017. Shimao's liquidity position is strong. Its cash balance of RMB22.2 billion at end-2016 was sufficient to meet its short- term debt of RMB17.9 billion and committed land payments in the next 12 months. Shimao's Ba2 corporate family rating reflects the company's conservative business growth targets, which in turn will reduce its capital expenditure requirements. The rating also reflects its diversified, well-located land bank and its portfolio of quality investment properties. The company's good access to funding channels is supported by its domestically listed subsidiary, Shanghai Shimao Co., Ltd. (unrated). However, the rating is constrained by the company's modest credit metrics for its rating level, as a result of its weakened profitability and increased debt leverage. The stable rating outlook reflects Moody's expectation that Shimao will slow its business growth, such that its debt leverage will fall to levels appropriate for the company's rating in the next 12-18 months. Moreover, Moody's expects Shimao's liquidity to remain adequate through disciplined land acquisitions and proactive management of capital. The principal methodology used in these ratings was Homebuilding And Property Development Industry published in April 2015. Shimao Property Holdings Limited is a Grand Cayman-incorporated Chinese property developer listed on the Hong Kong Stock Exchange in July 2006. Together with its majority-owned Shanghai A-share listed subsidiary, Shanghai Shimao Co., Ltd. (unrated), the company held an attributable land bank of 30.79 million square meters at December 31, 2016, distributed across 43 cities, mainly in eastern and northeastern China. SHIMAO PROPERTY: S&P Assigns 'BB' Rating to Proposed US$ Notes -------------------------------------------------------------- S&P Global Rating assigned its 'BB' long-term issue rating to a proposed issue of U.S.-dollar-denominated senior unsecured notes by Shimao Property Holdings Ltd. (BB+/Negative/--; cnBBB/--). S&P also assigned its 'cnBBB-' long-term Greater China regional scale rating to the notes. The issue rating is one notch lower than the long-term corporate credit rating on Shimao to reflect the structural subordination risk. The ratings are subject to S&P's review of the final issuance documentation. Shimao is planning to use the proceeds to refinance existing debt and for general working capital. S&P expects the refinancing could slightly reduce the company's effective interest cost and extend its debt maturity profile. In February, the China-based property developer early-redeemed U.S.-dollar-denominated senior notes due 2020 with an outstanding principal amount of US$800 million. The rating on Shimao is unaffected by the new issuance as the company's operating performance is within S&P's expectation. S&P anticipates the company will achieve its full-year sales target of Chinese renminbi (RMB) 80 billion. At the same time, S&P forecasts that Shimao's financial leverage will improve to between 4.0x-4.5x in 2017, driven by steady revenue growth, margin improvement, and disciplined debt management. The negative outlook on Shimao reflects the company's high leverage and the likelihood that leverage may not improve to the extent S&P anticipates. S&P could lower the rating if the ratio of debt-to-EBITDA ratio does not improve towards 4.0x. On the other hand, S&P could revise the outlook back to stable if Shimao demonstrates a gradual leverage improvement with the debt-to- EBITDA ratio moving towards 4.0x and at the same time Shimao's EBITDA interest coverage maintains at above 3.0x. SPI ENERGY: Seeking to List Ordinary Shares on Nasdaq ----------------------------------------------------- SPI Energy Co., Ltd., disclosed that it has had discussions with the Nasdaq Stock Market seeking to list the ordinary shares of the Company, par value US$0.000001 each, for trading on The Nasdaq Global Select Market in substitution for its American depositary shares, each representing ten Ordinary Shares. As previously disclosed, The Bank of New York Mellon, the depositary bank for the Company's American depositary shares facility, announced on March 17, 2017, that it would terminate the American depositary receipts facility of the Company at 5:00 PM (Eastern Time) on June 19, 2017. The Company expects that, upon the effectiveness of the Substitution Listing, its ADSs will cease to be listed on Nasdaq while the Ordinary Shares represented by the ADSs will trade on Nasdaq under the symbol of "SPI." The Company has appointed Computershare as the transfer agent for its Ordinary Shares in the United States. However, there remains uncertainty regarding whether the Company will be able to obtain clearance from Nasdaq to effectuate the Substitution Listing prior to the Termination Date. Subsequent to the Termination Date, Nasdaq may suspend the trading of the Company's ADSs until such time as the Substitution Listing shall have taken effect or as otherwise determined by the staff of Nasdaq. Owners and holders of the Company's ADSs may surrender their ADSs to the Depositary for delivery of the underlying Ordinary Shares. To surrender the ADRs, the address of the Depositary is: The Bank of New York Mellon, 101 Barclay Street, Depositary Receipts Division -- 22nd Floor, Attention: Cancellation Desk, New York, NY 10286. Registered or overnight mail is the suggested method of delivering ADRs to the Depositary. For further information regarding the ADRs, please contact the Depositary at 1-888-269- 2377 for US callers or 1-201-680-6825 for non-US callers. Subsequent to the Termination Date, under the terms of the deposit agreement among the Company, the Depositary and owners and holders of the American deposit receipts of the Company, the Depositary may attempt to sell the underlying shares. If the Depositary has sold such underlying shares or received value for such shares, holders must surrender the American depositary shares to obtain payment of the sale proceeds, net of expenses and applicable tax and charges. About SPI Energy Co., Ltd. SPI Energy Co., Ltd. (NASDAQ:SPI) is a global provider of photovoltaic (PV) solutions for business, residential, government and utility customers and investors. SPI Energy focuses on the downstream PV market including the development, financing, installation, operation and sale of utility-scale and residential solar power projects in China, Japan, Europe and North America. It operates online energy e-commerce and investment platforms, http://www.solarbao.com/and http://www.solartao.com/.The Company has its operating headquarters in Shanghai and maintains global operations in Asia, Europe, North America and Australia. SPI Energy reported a net loss of $185 million on $191 million of net sales for the year ended Dec. 31, 2015, compared to a net loss of $5.19 million on $91.6 million of net sales for the year ended Dec. 31, 2014. As of Dec. 31, 2015, SPI Energy had $710 million in total assets, $493 million in total liabilities and $216.6 million in total stockholders' equity. KPMG Huazhen LLP, in Shanghai, China, issued a "going concern" qualification on the consolidated financial statements for the year ended Dec. 31, 2015, citing that SPI Energy Co., Ltd., and its subsidiaries have suffered significant losses from operations and have a negative working capital as of Dec. 31, 2015. In addition, the Group has substantial amounts of debts that will become due for repayment in 2016. The auditors said these factors raise substantial doubt about the Group's ability to continue as a going concern. ================ H O N G K O N G ================ NOBLE GROUP: Attracts Goldilocks as New Major Holder ---------------------------------------------------- Jack Farchy and Jasmine Ng at Bloomberg News report that Noble Group Ltd., the commodity trader that's struggling for survival, has a new substantial shareholder after an Abu Dhabi fund built up a 5% stake over two days. The stock rallied in Singapore. Goldilocks Investment Co. added 50.5 million shares on June 20, after buying 15.5 million shares the day before, Bloomberg relates citing a filing to the Singapore Exchange late on June 22. Goldilocks now has a holding of 5.03 percent. Bloomberg notes that the investment came as Hong Kong-based Noble Group searches for a strategic investor to restore confidence after a collapse in its shares and bonds, and followed an agreement with core banks to extend a key credit facility. Goldilocks is controlled by investor Jassim Alseddiqi's Abu Dhabi Financial Group, which didn't respond to requests for comment, Bloomberg discloses. It started the $200 million fund last year, saying that it would target undervalued opportunities in the six Gulf Cooperation Council countries. "Goldilocks's involvement, together with the recent extension of Noble's credit facility, provides some encouragement that it can achieve a meaningful restructure," Bloomberg quotes Ric Spooner, chief market analyst at CMC Markets in Sydney, as saying in an email. "However, conservative investors are likely to need evidence of a more significant deal on equity partnership or asset sales." According to Bloomberg, Noble Group has rallied last week after the company agreed to extend by 120 days the $2 billion credit facility that had been due to mature, paring its slump since the start of the year. On June 23, the stock surged as much as 22% to 55.5 Singapore cents, and ended at 53 cents, Bloomberg notes. About Noble Group Hong Kong-based Noble Group Limited (SGX:N21) -- http://www.thisisnoble.com/-- engages in supply of agricultural, industrial and energy products. The Company supplies agricultural and energy products, metals, minerals and ores. Agriculture products include grains, oilseeds and sugar to palm oil, coffee, and cocoa. Energy business includes coal, gas and liquid energy products. In metals, minerals and ores (MMO), it supplies iron ore, aluminum, special ores and alloys. The Company operates nearly in 140 locations. It supplies growth demand markets in Asia and Middle East. Alcoa World Alumina and Chemicals is the subsidiary of this company. As reported in the Troubled Company Reporter-Asia Pacific on May 24, 2017, S&P Global Ratings lowered its long-term corporate credit rating on Noble Group Ltd. to 'CCC+' from 'B+'. The outlook is negative. At the same time, S&P lowered the long-term issue rating on Noble's outstanding senior unsecured notes to 'CCC' from 'B'. In addition, S&P lowered its long-term Greater China regional scale rating on the company to 'cnCCC+' from 'cnBB-' and on the notes to 'cnCCC' from 'cnB+'. S&P downgraded Noble because it believed the company's capital structure is not sustainable. This is due to continuing weak cash flows and profitability, and Noble's access to funding will have further weakened following its weak results for the three months ending March 31, 2017. The TCR-AP reported on May 18, 2017, that Moody's Investors Service has downgraded Noble Group Limited's corporate family rating and senior unsecured bond ratings to Caa1 from B2, and the rating on its senior unsecured medium-term note (MTN) program to (P)Caa1 from (P)B2. The ratings outlook remains negative. ========= I N D I A ========= AADYA MOTOR: CRISIL Reaffirms 'D' Rating on INR20MM Loan -------------------------------------------------------- CRISIL Ratings has been consistently following up with Aadya Motor Company India Private Limited (AMCPL) for obtaining information through letters and emails dated March 6, 2017, and March 22, 2017, among others, apart from telephonic communication. However, the issuer has remained non cooperative. CRISIL thus gave these ratings: Amount Facilities (INR Mln) Ratings ---------- --------- ------- Bank Guarantee 12 CRISIL D (Issuer Not Cooperating; Rating Reaffirmed) Working Capital 20 CRISIL D (Issuer Not Facility Cooperating) The investors, lenders and all other market participants should exercise due caution while using the rating assigned/reviewed with the suffix 'ISSUER NOT COOPERATING'. These ratings lack a forward looking component as it is arrived at without any management interaction and is based on best available or limited or dated information on the company. Detailed Rationale Despite repeated attempts to engage with the management, CRISIL failed to receive any information on either the financial performance or strategic intent of Aadya Motor Company India Private Limited. This restricts CRISIL's ability to take a forward looking view on the credit quality of the entity. CRISIL believes that the information available for Aadya Motor Company India Private Limited is consistent with 'Scenario 1' outlined in the 'Framework for Assessing Consistency of Information with CRISIL B' category or lower. Based on the last available information, CRISIL has reaffirmed the rating at 'CRISIL D/CRISIL D'. Incorporated in 2012, AMCPL, promoted by Mr. V Ramanand Rao, is the authorised dealer for Porsche, with its showroom in Mumbai. The company began operations in September 2012. The promoter also has interests in auto dealerships of other brands through group entities. AARVEE INTERNATIONAL: CRISIL Cuts Rating on INR18MM Loan to 'D' --------------------------------------------------------------- CRISIL has downgraded its rating on the long-term bank facilities Aarvee International (AI) to 'CRISIL D' from 'CRISIL BB/Stable'. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Cash Credit 18 CRISIL D (Downgraded from 'CRISIL BB/Stable') Proposed Cash 2 CRISIL D (Downgraded from Credit Limit 'CRISIL BB/Stable') The downgrade reflects the firm's overutilization of the cash credit facility for three consecutive months with delay in repaying its interest servicing of the WC facility. Key Rating Drivers & Detailed Description Weaknesses * Over utilization of the working capital facility: The limits have been over utilized since February 2017 with currently no operations being undertaken in the firm. Low accrual and large working capital debt resulted in stretched liquidity, resulting in delay in meeting interest obligation on working capital limits. Strengths * Extensive experience of promoters The promoters have close to two decades of experience in trading in agro commodities. For 15 years, the promoters were associated with various firms such as Aarvee Global Impex and Aarvee Agro Processing and then established AI in 2012. AI was established in 2012 by the Sorthaiya family based in Rajkot (Gujarat). The firm trades in agri-based commodities such as soyabean meal, rapeseed and groundnut extraction meal, and wheat. ASIAN THAI: CRISIL Reaffirms 'B' Rating on INR10MM LT Loan ---------------------------------------------------------- CRISIL Ratings has been consistently following up with Asian Thai Foods India Private Limited (ATFIPL) for obtaining information through letters and emails dated March 6, 2017, and March 22, 2017, among others, apart from telephonic communication. However, the issuer has remained non cooperative. CRISIL thus gave these ratings: Amount Facilities (INR Mln) Ratings ---------- --------- ------- Proposed Long Term 10 CRISIL B/Stable (Issuer Not Bank Loan Facility Cooperating; Rating Reaffirmed) The investors, lenders and all other market participants should exercise due caution while using the rating assigned/reviewed with the suffix 'ISSUER NOT COOPERATING'. These ratings lack a forward looking component as it is arrived at without any management interaction and is based on best available or limited or dated information on the company. Detailed Rationale Despite repeated attempts to engage with the management, CRISIL failed to receive any information on either the financial performance or strategic intent of Asian Thai Foods India Private Limited. This restricts CRISIL's ability to take a forward looking view on the credit quality of the entity. CRISIL believes that the information available for Asian Thai Foods India Private Limited is consistent with 'Scenario 1' outlined in the 'Framework for Assessing Consistency of Information with CRISIL B' category or lower. Based on the last available information, CRISIL has reaffirmed the rating at 'CRISIL B/Stable'. ATFIPL is a subsidiary of Asian Thai Foods (P) Ltd and was incorporated in December 2009. It is setting up a food processing plant at Chaygaon, Kamrup, Assam, and is promoted by the Sharda group, the Jaju group of Nepal, the Baid group headed by Mr. Mulchand Baid, and the Agarwal group of Assam. The plant is expected to have an installed capacity of 7875 MTPA for Instant Noodles and 225 MTPA for Noodles Bhujia. BABA BEARINGS: CRISIL Cuts Rating on INR2.64MM Loan to 'B' ---------------------------------------------------------- CRISIL Ratings has been consistently following up with Baba Bearings Private Limited (BBPL) for obtaining information through letters and emails dated January 27, 2017, and March 22, 2017, among others, apart from telephonic communication. However, the issuer has remained non cooperative. CRISIL thus gave these ratings: Amount Facilities (INR Mln) Ratings ---------- --------- ------- Cash Credit 2.6 CRISIL B/Stable (Issuer Not Cooperating; Downgraded from 'CRISIL B+/Stable') Letter of Credit 0.4 CRISIL A4 (Issuer Not Cooperating; Downgraded from 'CRISIL B+/Stable') Term Loan 2.64 CRISIL B/Stable (Issuer Not Cooperating; Downgraded from 'CRISIL B+/Stable') The investors, lenders and all other market participants should exercise due caution while using the rating assigned/reviewed with the suffix 'ISSUER NOT COOPERATING'. These ratings lack a forward looking component as it is arrived at without any management interaction and is based on best available or limited or dated information on the company. Detailed Rationale Despite repeated attempts to engage with the management, CRISIL failed to receive any information on either the financial performance or strategic intent of Baba Bearings Private Limited. This restricts CRISIL's ability to take a forward looking view on the credit quality of the entity. CRISIL believes that the information available for Baba Bearings Private Limited is consistent with 'Scenario 1' outlined in the 'Framework for Assessing Consistency of Information with CRISIL B' category or lower. Based on the last available information, CRISIL has downgraded the Long Term rating to 'CRISIL B/Stable' & Reaffirmed Short Term rating at 'CRISIL A4'. BBPL was incorporated in 1992, promoted by the Kansara family. The company manufactures all types of rollers (cylindrical, spherical, tapered, and flat-end needles) and supplies to major bearing manufacturing companies in India as well as in European countries such as the UK, Germany, Italy, and France. The products find application in the automotive and other precision engineering industries. The company's unit is at Boranada in Jodhpur, Rajasthan. Its operations are managed by Mr. Brijlal Kansara, Mr Balkishan Kansara, Mr. Hari Narayan Kansara, and other family members. BRAHMANAND HIMGHAR: CRISIL Reaffirms B+ Rating on INR10MM Loan -------------------------------------------------------------- CRISIL Ratings has been consistently following up with Brahmanand Himghar Limited (BHL) for obtaining information through letters and emails dated January 31, 2017, and February 28, 2017, among others, apart from telephonic communication. However, the issuer has remained non cooperative. CRISIL thus gave these ratings: Amount Facilities (INR Mln) Ratings ---------- --------- ------- Proposed Long Term 10 CRISIL B+/Stable (Issuer Not Bank Loan Facility Cooperating; Rating Reaffirmed) The investors, lenders and all other market participants should exercise due caution while using the rating assigned/reviewed with the suffix 'ISSUER NOT COOPERATING'. These ratings lack a forward looking component as it is arrived at without any management interaction and is based on best available or limited or dated information on the company. Detailed Rationale Despite repeated attempts to engage with the management, CRISIL failed to receive any information on either the financial performance or strategic intent of Brahmanand Himghar Limited. This restricts CRISIL's ability to take a forward looking view on the credit quality of the entity. CRISIL believes that the information available for Brahmanand Himghar Limited is consistent with 'Scenario 3' outlined in the 'Framework for Assessing Consistency of Information with CRISIL BBB' category or lower. Based on the last available information, CRISIL has reaffirmed the rating at 'CRISIL B+/Stable'. BHL, incorporated in June 1990, provides cold storage services to potato famers and traders. The company has two cold storages'one each in Paschim Medinipore (West Bengal) and Seraikella-Kharsawan (Jharkhand). Mr. Rajendra Kumar Agrawal is the managing director. CARITAS HEALTHCARE: CRISIL Reaffirms B+ Rating on INR6MM Loan ------------------------------------------------------------- CRISIL Ratings has been consistently following up with Caritas Healthcare Private Limited (CHPL) for obtaining information through letters and emails dated February 14, 2017, and March 8, 2017, among others, apart from telephonic communication. However, the issuer has remained non cooperative. CRISIL thus gave these ratings: Amount Facilities (INR Mln) Ratings ---------- --------- ------- Cash Credit 2 CRISIL B+/Stable (Issuer Not Cooperating; Rating Reaffirmed) Export Packing Credit 6 CRISIL B+/Stable (Issuer Not Cooperating; Rating Reaffirmed) The investors, lenders and all other market participants should exercise due caution while using the rating assigned/reviewed with the suffix 'ISSUER NOT COOPERATING'. These ratings lack a forward looking component as it is arrived at without any management interaction and is based on best available or limited or dated information on the company. Detailed Rationale Despite repeated attempts to engage with the management, CRISIL failed to receive any information on either the financial performance or strategic intent of Caritas Healthcare Private Limited. This restricts CRISIL's ability to take a forward looking view on the credit quality of the entity. CRISIL believes that the information available for Caritas Healthcare Private Limited is consistent with 'Scenario 3' outlined in the 'Framework for Assessing Consistency of Information with CRISIL BBB' category or lower. Based on the last available information, CRISIL has reaffirmed the rating at 'CRISIL B+/Stable'. Incorporated in 2012, CHPL is a Ahmedabad (Gujarat) based company. The company supplies and markets a wide range of pharmaceutical products across the globe. It is promoted by Mr. Ketan Patel and Mr. Jogendra Bhati. DERON PROPERTIES: CRISIL Assigns B+ Rating to INR25MM Term Loan --------------------------------------------------------------- CRISIL Ratings has assigned its 'CRISIL B+/Stable' rating to the long-term bank facilities of Deron Properties Private Limited (DPPL). Amount Facilities (INR Mln) Ratings ---------- --------- ------- Rupee Term Loan 17.5 CRISIL B+/Stable Cash Credit 12.5 CRISIL B+/Stable Proposed Rupee Term Loan 25 CRISIL B+/Stable The rating reflects the company's exposure to risks related to implementation, funding, and saleability of its projects, and susceptibility to intense competition and cyclicality inherent in the real estate industry. These weaknesses are partially offset by its promoters' extensive industry experience, and healthy sales in past projects. Key Rating Drivers & Detailed Description Weakness * Exposure to risks related to implementation, funding, and saleability of projects: DPPL is developing three projects (mix of residential and commercial) in Pune at an estimated cost of INR130 crore. Timely completion and sale of the projects will determine its liquidity over the medium term. * Vulnerability to cyclicality inherent in the Indian real estate industry: The real estate sector in India is cyclical and highly fragmented, and is affected by volatile prices and opaque transactions. The company's business risk profile will remain susceptible to risks arising from any industry slowdown. Strengths * Promoters' extensive experience in the real estate business: Mr Umang Madan has experience of 30 years and has established himself in the real estate market in Pune through successful project implementation. * Strategic location of projects: The company's three projects are in strategic locations (close to Hinjewadi information technology park) and are well connected to the industrial belt in Pune, which will support sales. Outlook: Stable CRISIL believes DPPL will continue to benefit from its promoters' extensive industry experience. The outlook may be revised to 'Positive' if substantial sales and timely receipt of customer advances lead to higher-than expected cash inflow. The outlook may be revised to 'Negative' if time or cost overrun in the projects, or slower-than-expected customer bookings result in low cash inflow and constrain the financial risk profile and liquidity. Incorporated in 2011, DPPL is engaged in residential and commercial real estate development. It is promoted by Mr Umang Madan and his wife Ms Mansi Madan. The company is developing Deron Bhushnam in Baner, Deron Business Square in Hinjewadi, and Deron Prosper and Deron Rise at Rahatani. DRASHTI INNOVATIVE: CRISIL Reaffirms D Rating on INR10.13MM Loan ---------------------------------------------------------------- CRISIL Ratings has been consistently following up with Drashti Innovative Syncotex Pvt. Ltd. (DISPL) for obtaining information through letters and emails dated March 6, 2017, and March 22, 2017, among others, apart from telephonic communication. However, the issuer has remained non cooperative. CRISIL thus gave these ratings: Amount Facilities (INR Mln) Ratings ---------- --------- ------- Bank Guarantee 1 CRISIL D (Issuer Not Cooperating; Rating Reaffirmed) Cash Credit 10.13 CRISIL D (Issuer Not Cooperating; Rating Reaffirmed) Proposed Long Term 4.00 CRISIL D (Issuer Not Bank Loan Facility Cooperating; Rating Reaffirmed) Term Loan 9.87 CRISIL D (Issuer Not Cooperating; Rating Reaffirmed) The investors, lenders and all other market participants should exercise due caution while using the rating assigned/reviewed with the suffix 'ISSUER NOT COOPERATING'. These ratings lack a forward looking component as it is arrived at without any management interaction and is based on best available or limited or dated information on the company. Detailed Rationale Despite repeated attempts to engage with the management, CRISIL failed to receive any information on either the financial performance or strategic intent of Drashti Innovative Syncotex Pvt. Ltd.. This restricts CRISIL's ability to take a forward looking view on the credit quality of the entity. CRISIL believes that the information available for Drashti Innovative Syncotex Pvt. Ltd. is consistent with 'Scenario 1' outlined in the 'Framework for Assessing Consistency of Information with CRISIL B' category or lower. Based on the last available information, CRISIL has reaffirmed the rating at 'CRISIL D/CRISIL D'. Incorporated in 2013 and based in Surat, Gujarat, DISPL manufactures and trades in fabrics used in home furnishing, readymade garments, and dress material. GIPL, also based in Surat and incorporated in 2010, is in a similar line of business. The manufacturing facilities of both companies are in Surat. DISPL is promoted by Mr. Dhaval Nakrani and Mr. Vishal Balar, while GIPL is promoted by Mr. Nakrani. GAURI INTERNATIONAL: CRISIL Reaffirms D Rating on INR15MM Loan -------------------------------------------------------------- CRISIL Ratings has been consistently following up with Gauri International Private Limited (GIPL) for obtaining information through letters and emails dated March 6, 2017, and March 22, 2017, among others, apart from telephonic communication. However, the issuer has remained non cooperative. CRISIL thus gave these ratings: Amount Facilities (INR Mln) Ratings ---------- --------- ------- Cash Credit 15 CRISIL D (Issuer Not Cooperating; Rating Reaffirmed) Proposed Long Term 10 CRISIL D (Issuer Not Bank Loan Facility Cooperating; Rating Reaffirmed) The investors, lenders and all other market participants should exercise due caution while using the rating assigned/reviewed with the suffix 'ISSUER NOT COOPERATING'. These ratings lack a forward looking component as it is arrived at without any management interaction and is based on best available or limited or dated information on the company. Detailed Rationale Despite repeated attempts to engage with the management, CRISIL failed to receive any information on either the financial performance or strategic intent of Gauri International Private Limited. This restricts CRISIL's ability to take a forward looking view on the credit quality of the entity. CRISIL believes that the information available for Gauri International Private Limited is consistent with 'Scenario 1' outlined in the 'Framework for Assessing Consistency of Information with CRISIL B' category or lower. Based on the last available information, CRISIL has reaffirmed the rating at 'CRISIL D'. Incorporated in 2010 and based in Surat, Gujarat, GIPL manufactures and trades in fabrics used in home furnishing, readymade garments, and dress material. DISPL, also based in Surat and incorporated in 2013, is in a similar line of business. The manufacturing facilities of both companies are in Surat. GIPL is promoted by Mr. Dhaval Nakrani and DISPL is promoted by Mr. Nakrani and Mr. Vishal Balar. GK-AUTOPAL LIGHTING: CRISIL Reaffirms B Rating on INR5MM Loan ------------------------------------------------------------- CRISIL Ratings has been consistently following up with GK-Autopal Lighting Solutions LLP (GKALS) for obtaining information through letters and emails dated January 25, 2017, and February 15, 2017, among others, apart from telephonic communication. However, the issuer has remained non cooperative. CRISIL thus gave these ratings: Amount Facilities (INR Mln) Ratings ---------- --------- ------- Cash Credit 5 CRISIL B/Stable (Issuer Not Cooperating; Rating Reaffirmed) Rupee Term Loan 1.5 CRISIL B/Stable (Issuer Not Cooperating; Rating Reaffirmed) The investors, lenders and all other market participants should exercise due caution while using the rating assigned/reviewed with the suffix 'ISSUER NOT COOPERATING'. These ratings lack a forward looking component as it is arrived at without any management interaction and is based on best available or limited or dated information on the company. Detailed Rationale Despite repeated attempts to engage with the management, CRISIL failed to receive any information on either the financial performance or strategic intent of GK-Autopal Lighting Solutions LLP. This restricts CRISIL's ability to take a forward looking view on the credit quality of the entity. CRISIL believes that the information available for GK-Autopal Lighting Solutions LLP is consistent with 'Scenario 1' outlined in the 'Framework for Assessing Consistency of Information with CRISIL B' category or lower. Based on the last available information, CRISIL has reaffirmed the rating at 'CRISIL B/Stable'. GKALS was registered as a partnership firm with limited liability (LLP) on December 29, 2014. The firm is currently engaged in trading of compact fluorescent lamps (CFLs) and is in the process of setting up a plant for manufacturing light-emitting diode (LED) luminaries. GOUTHAMI HATCHERIES: CRISIL Reaffirms D Rating on INR16.5MM Loan ---------------------------------------------------------------- CRISIL Ratings has been consistently following up with Gouthami Hatcheries Private Limited (GHPL) for obtaining information through letters and emails dated March 6, 2017, and March 22, 2017, among others, apart from telephonic communication. However, the issuer has remained non cooperative. CRISIL thus gave these ratings: Amount Facilities (INR Mln) Ratings ---------- --------- ------- Cash Credit 16 CRISIL D (Issuer Not Cooperating; Rating Reaffirmed) Long Term Loan 16.5 CRISIL D (Issuer Not Cooperating; Rating Reaffirmed) Proposed Long Term 7.12 CRISIL D (Issuer Not Bank Loan Facility Cooperating; Rating Reaffirmed) The investors, lenders and all other market participants should exercise due caution while using the rating assigned/reviewed with the suffix 'ISSUER NOT COOPERATING'. These ratings lack a forward looking component as it is arrived at without any management interaction and is based on best available or limited or dated information on the company. Detailed Rationale Despite repeated attempts to engage with the management, CRISIL failed to receive any information on either the financial performance or strategic intent of Gouthami Hatcheries Private Limited. This restricts CRISIL's ability to take a forward looking view on the credit quality of the entity. CRISIL believes that the information available for Gouthami Hatcheries Private Limited is consistent with 'Scenario 1' outlined in the 'Framework for Assessing Consistency of Information with CRISIL B' category or lower. Based on the last available information, CRISIL has reaffirmed the rating at 'CRISIL D'. GHPL, set up in 1999, produces hatching eggs and broiler birds. SFPL, set up in 2009, manufactures poultry feed. The companies are promoted by Mr. D Srinath Reddy and his wife, Ms. D Lokeshwari. GOYAL SONS: CRISIL Cuts Rating on INR2MM Cash Loan to 'B' --------------------------------------------------------- CRISIL Ratings has been consistently following up with Goyal Sons (GS) for obtaining information through letters and emails dated January 20, 2017, and February 10, 2017, among others, apart from telephonic communication. However, the issuer has remained non cooperative. CRISIL thus gave these ratings: Amount Facilities (INR Mln) Ratings ---------- --------- ------- Bank Guarantee .5 CRISIL A4 (Issuer Not Cooperating; Downgraded from 'CRISIL A4+') Cash Credit 2 CRISIL B/Stable (Issuer Not Cooperating; Downgraded from 'CRISIL BB/Stable') Letter of Credit 2.5 CRISIL A4 (Issuer Not Cooperating; Downgraded from 'CRISIL A4+') The investors, lenders and all other market participants should exercise due caution while using the rating assigned/reviewed with the suffix 'ISSUER NOT COOPERATING'. These ratings lack a forward looking component as it is arrived at without any management interaction and is based on best available or limited or dated information on the company. Detailed Rationale Despite repeated attempts to engage with the management, CRISIL failed to receive any information on either the financial performance or strategic intent of Goyal Sons. This restricts CRISIL's ability to take a forward looking view on the credit quality of the entity. CRISIL believes that the information available for Goyal Sons is consistent with 'Scenario 1' outlined in the 'Framework for Assessing Consistency of Information with CRISIL B' category or lower. Based on the last available information, CRISIL has downgraded the rating at 'CRISIL B/Stable/CRISIL A4'. GS was established as a proprietorship concern by Mr. Vinod Goyal in 1987. The firm is based in Ludhiana (Punjab) and trades in various types of blended yarn. It is also an authorised agent for distribution of synthetic textile yarn of Reliance Industries Ltd (RIL) ('CRISIL AAA/Stable/CRISIL A1+'), Chiripal Industries Ltd, Sanghi Polyester Ltd, Sanghi Spinners India Ltd, and JCT Ltd. GRAND HYUNDAI: CRISIL Reaffirms B+ Rating on INR9.2MM Loan ---------------------------------------------------------- CRISIL Ratings has reaffirmed its 'CRISIL B+/Stable' rating on the long-term bank facilities of Grand Hyundai (GH). Amount Facilities (INR Mln) Ratings ---------- --------- ------- Cash Credit 3 CRISIL B+/Stable (Reaffirmed) Inventory Funding Facility 9.2 CRISIL B+/Stable (Reaffirmed) Term Loan 0.8 CRISIL B+/Stable (Reaffirmed) The rating reflects a modest scale of operations, large working capital requirement, and a weak financial risk profile. These rating weaknesses are partially offset by the extensive experience of the promoters in automobile dealership industry and benefits of association with the principal, Hyundai Motor India Limited (HMIL; rated 'CRISIL A1+'). Key Rating Drivers & Detailed Description Weakness * Modest scale of operations: Revenue is estimated at a modest INR85.26 crore for fiscal 2017 (Rs 77.01 crore in fiscal 2016). The operating margin was low at 3.8% for fiscal 2016 and is estimated at 3.8 % for fiscal 2017 * Weak financial risk profile: The total outside liabilities to tangible networth ratio was high, estimated at 6.23 times as on March 31, 2017. The debt protection metrics were average, with interest coverage ratio estimated at 1.44 times and net cash accrual to total debt ratio at 0.04 time for fiscal 2017. * Susceptibility to risks relating to low bargaining power with the principal and intense industry competition: Owing to the modest scale of operations, there is limited bargaining power with HMIL. Furthermore, the principal faces competitive pressures from other four-wheel vehicle manufacturing brands such as Maruti Suzuki, Renault, Tata, and Ford. Competition has compelled automakers to cut costs, including reducing their commissions to dealers. Strengths * Extensive industry experience of the promoters: The promoters have an experience of 32 years in the automobile dealership business. They have another concern, Grand Motors, engaged in the dealership of Bajaj two- and three-wheelers in Palakkad and Thrissur, in Kerala. * Benefits from association with HMIL: HMIL has a dominant market position in the industry as the second-largest player in the passenger vehicle segment. Launch of new vehicles by the principal will continue to drive the market position of GH. Outlook: Stable CRISIL believes GH will maintain a stable business risk profile over the medium term backed by the extensive industry experience of its promoters and an established relationship with the main principal, HMIL. The outlook may be revised to 'Positive' if there is infusion of substantial equity, leading to a better financial risk profile and risk absorption capacity, and an increase in turnover resulting in improvement of the business risk profile. The outlook may be revised to 'Negative' in case of a stretched working capital cycle, a decline in the operating margin, or significant debt-funded capital expenditure, leading to deterioration in the financial risk profile, particularly liquidity. Set up in April 2012, GH is mainly engaged in HMIL's dealership for sale of cars, spares and service of vehicles in Kerala. The firm has seven showrooms and three service centers. The day to day operations are managed by Mr.Mohammed Iqbal. GH reported a book profit of INR0.57 crores on revenues of INR77.01 crores for fiscal 2017 against book profit INR0.55 crores on revenues of INR65.07 crore for fiscal 2016. GRAND MOTORS: CRISIL Reaffirms 'B' Rating on INR3.5MM Cash Loan --------------------------------------------------------------- CRISIL Ratings has reaffirmed its 'CRISIL B/Stable/CRISIL A4' ratings to the bank facilities of Grand Motors (GM). Amount Facilities (INR Mln) Ratings ---------- --------- ------- Bank Guarantee 1.5 CRISIL A4 (Reaffirmed) Cash Credit 3.5 CRISIL B/Stable (Reaffirmed) Inventory Funding Facility 3.5 CRISIL B/Stable (Reaffirmed) Proposed Long Term Bank Loan Facility .5 CRISIL B/Stable (Reaffirmed) The ratings continue to reflect modest scale of operations, weak financial risk profile and susceptibility to risks relating to low bargaining power with principal and intense competition in automotive (auto) dealership market. These rating weaknesses are partially offset by the extensive experience of promoters in automobile distribution and benefits of association with the principal, Bajaj Auto Limited (BAL; rated 'CRISIL AAA/FAAA/Stable/CRISIL A1+'). Key Rating Drivers & Detailed Description Weakness * Modest scale of operations: Revenue was modest at INR67.65 crore in fiscal 2017 (Rs 55.83 crore in fiscal 2016). The operating margin was low at 2.7% for fiscal 2017 due to the trading nature of operations. * Weak financial risk profile: The total outside liabilities to tangible net worth ratio was high at 14.93 times as on March 31, 2017. The debt protection metrics were weak, with interest coverage ratio at 1.22 times and net cash accrual to total debt ratio at 0.04 time for fiscal 2017. * Susceptibility to risks relating to low bargaining power with the principal and to intense industry competition: Owing to the modest scale of operations, there is limited bargaining power with BAL. Furthermore, the principal faces competitive pressures from other two- and three-wheeler manufacturing brands such as Hero MotoCorp, Suzuki Motorcycles India Pvt Ltd, TVS Motor Company Ltd. India, and Yamaha Motor Pvt Ltd. Competition has compelled automakers to cut costs, including reducing their commissions to dealers. Strengths * Extensive industry experience of the promoter: The promoter, Mr. Chola has experience of around 32 years in the auto and ancillary industry. He has been in the auto dealership business for about 10 years. Before establishing GM, he was a distributor of spare parts of two- and three-wheelers. He and his son Mr Saljas, manage operations. The promoters have also set up another entity, Grand Hyundai (rated CRISIL B+/ Stable), which is an authorised dealer of Hyundai Motor Company in Palakkad, Kerala. GM currently has 27 service, spare parts, and sales centres, with facilities spread across three districts of Kerala. * Benefits from association with BAL: The firm is an authorised dealer for the vehicles of BAL, which is a leader in the two- and three-wheeler segment. Furthermore, with the regular launch of new vehicles by the principal, sound business growth is expected. Outlook: Stable CRISIL believes GM will continue to benefit over the medium term from its exclusive dealership contract with BAL. The outlook may be revised to 'Positive' if GM's sales volume and operating margin increase substantially, or if promoter infuse equity, resulting in improvement in capital structure. Conversely, the outlook may be revised to 'Negative' if volume declines, significantly impacting revenue and profitability, or in case of large debt-funded capital expenditure, weakening capital structure and cash accrual. Incorporated in February 2007, GM is the sole distributor of Bajaj two wheelers in Thrissur & Palakkad district in Kerala and Bajaj's three wheeler (autos) for Malappuram, Kerala. GM reported a book profit of INR0.15 crores on revenues of INR67.65 crores for fiscal 2017 against book profit INR0.20 crores on revenues of INR55.83 crore for fiscal 2016. Any other information: GM achieved revenue of INR67.65 crores in fiscal 2017 against revenue of INR55.83 crores in fiscal 2016. This increase in sales will support business risk profile over the medium term. Operating margin was low at 2.7% for fiscal 2017 due to trading nature of operations. Working capital requirement is efficiently managed: gross current assets were 70 days as on March 31, 2017. Net cash accrual was INR0.30 crore and INR0.37 crore in fiscals 2016 and 2017, respectively, against no long-term debt obligation. The lack of any fixed debt repayment obligations enhance financial flexibility over the medium term. JHUNJHUNWALA OIL: CRISIL Reaffirms D Rating on INR33MM Cash Loan ---------------------------------------------------------------- CRISIL Ratings has been consistently following up with Jhunjhunwala Oil Mills Limited (JOML) for obtaining information through letters and emails dated January 24, 2017, and February 14, 2017, among others, apart from telephonic communication. However, the issuer has remained non cooperative. CRISIL thus gives these ratings: Amount Facilities (INR Mln) Ratings ---------- --------- ------- Cash Credit 33 CRISIL D (Issuer Not Cooperating; Rating Reaffirmed) Letter of Credit 2 CRISIL D (Issuer Not Cooperating; Rating Reaffirmed) Proposed Long Term 1.5 CRISIL D (Issuer Not Bank Loan Facility Cooperating; Rating Reaffirmed) Standby Line of Credit 3.5 CRISIL D (Issuer Not Cooperating; Rating Reaffirmed) Term Loan 18.5 CRISIL D (Issuer Not Cooperating; Rating Reaffirmed) The investors, lenders and all other market participants should exercise due caution while using the rating assigned/reviewed with the suffix 'ISSUER NOT COOPERATING'. These ratings lack a forward looking component as it is arrived at without any management interaction and is based on best available or limited or dated information on the company. Detailed Rationale Despite repeated attempts to engage with the management, CRISIL failed to receive any information on either the financial performance or strategic intent of Jhunjhunwala Oil Mills Limited. This restricts CRISIL's ability to take a forward looking view on the credit quality of the entity. CRISIL believes that the information available for Jhunjhunwala Oil Mills Limited is consistent with 'Scenario 1' outlined in the 'Framework for Assessing Consistency of Information with CRISIL B' category or lower. Based on the last available information, CRISIL has reaffirmed the rating at 'CRISIL D/CRISIL D'. JOML was established by Mr. Vishwanath Jhunjhunwala in 1973. The company manufactures and refines edible oil, mainly rice bran oil, through the solvent extraction process. JOML also has a cattle- feed plant, which processes de-oiled cake, a by-product of solvent extraction. The company has solvent extraction and cattle-feed manufacturing facilities in Varanasi (Uttar Pradesh) and a rice milling unit in Kudra (Bihar). JUMBO BAG: CRISIL Reaffirms B+ Rating on INR35.8MM Cash Loan ------------------------------------------------------------ CRISIL Ratings has reaffirmed its ratings on the bank facilities of Jumbo Bag Limited (JBL) at 'CRISIL B+/Stable/CRISIL A4'. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Bank Guarantee 0.4 CRISIL A4 (Reaffirmed) Cash Credit 35.8 CRISIL B+/Stable (Reaffirmed) Foreign Bill Discounting 9.25 CRISIL B+/Stable (Reaffirmed) Letter of Credit 13.70 CRISIL A4 (Reaffirmed) Long Term Loan 1.70 CRISIL B+/Stable (Reaffirmed) Proposed Long Term Bank Loan Facility 2.65 CRISIL B+/Stable (Reaffirmed) The ratings continue to reflect the company's below-average financial risk profile because of leveraged capital structure and subdued debt protection metrics, working capital-intensive operations, and exposure to intense competition. These weaknesses are partially offset by its established regional market position in the flexible intermediate bulk containers (FIBC) segment. Analytical Approach Unsecured loans of INR80 lakh as on May 15, 2017, from promoters have been treated as neither debt nor equity as these are non- interest bearing and are subordinate to bank debt. Key Rating Drivers & Detailed Description Weaknesses * Below-average financial risk profile: Total outside liabilities to tangible networth ratio was high at over 5 times as on March 31, 2017, while interest coverage ratio was 1.63 times in fiscal 2017. However, capital structure and interest coverage ratio are expected to improve over the medium term with better profitability. * Working capital-intensive operations: Gross current assets were high at around 300 days as on March 31, 2017, due to sizeable inventory. Exposure to intense competition, and limited pricing flexibility: The FIBC industry is highly fragmented due to low entry barrier in terms of capital and technology requirements, low gestation period, and easy availability of raw materials. Strength * Established regional market position: With experience of over two decades in the FIBC segment, JBL is one of the leading players with presence in both low and medium-end grade bags. It caters to a diverse range of industries such as chemicals, minerals, and fertilisers, and has developed healthy relationship with customers and suppliers. Outlook: Stable CRISIL believes JBL will continue to benefit over the medium term from its strong market position, supported by established relationship with customers and suppliers. The outlook may be revised to 'Positive' if a significant improvement in scale of operations and profitability, or substantial equity infusion leads to a better financial risk profile. The outlook may be revised to 'Negative' if decline in cash accrual, large, debt-funded capital expenditure, or deterioration in working capital management further weakens financial risk profile. Established in 1990 in Chennai by Mr. G P N Gupta, JBL manufactures FIBCs, also known as jumbo bags. The company is a part of the Bliss group. Profit after tax was INR87.61 lakh on an operating income of INR96.44 crore in fiscal 2017 against net losses of INR66.81 lakh on an operating income of INR83.89 crore in fiscal 2016. Status of non-cooperation with previous CRA JBL has not cooperated with ICRA Ltd which has suspended its rating vide release dated October 3, 2016. The reason provided by ICRA Ltd is non-furnishing of information for monitoring of ratings. K.T. MATHEW: CRISIL Reaffirms 'B' Rating on INR4MM Cash Loan ------------------------------------------------------------ CRISIL Ratings has been consistently following up with K.T. Mathew & Co. (KTMC) for obtaining information through letters and emails dated February 7, 2017, and March 6, 2017, among others, apart from telephonic communication. However, the issuer has remained non cooperative. CRISIL thus gave these ratings: Amount Facilities (INR Mln) Ratings ---------- --------- ------- Bank Guarantee 4 CRISIL A4 (Issuer Not Cooperating; Rating Reaffirmed) Cash Credit 4 CRISIL B/Stable (Issuer Not Cooperating; Rating Reaffirmed) Proposed Working 1 CRISIL B/Stable (Issuer Not Capital Facility Cooperating; Rating Reaffirmed) The investors, lenders and all other market participants should exercise due caution while using the rating assigned/reviewed with the suffix 'ISSUER NOT COOPERATING'. These ratings lack a forward looking component as it is arrived at without any management interaction and is based on best available or limited or dated information on the company. Detailed Rationale Despite repeated attempts to engage with the management, CRISIL failed to receive any information on either the financial performance or strategic intent of K.T. Mathew & Co. This restricts CRISIL's ability to take a forward looking view on the credit quality of the entity. CRISIL believes that the information available for K.T. Mathew & Co. is consistent with 'Scenario 1' outlined in the 'Framework for Assessing Consistency of Information with CRISIL B' category or lower. Based on the last available information, CRISIL has reaffirmed the rating at 'CRISIL B/Stable/CRISIL A4'. KTMC, set up in 1962, is a partnership firm. It is engaged in civil construction, primarily construction of roads, bridges, and canals, for government entities. It is based in Ernakulam, Kerala and is promoted by Mr. Paul T Mathew. KEWIN CHEMICALS: CRISIL Reaffirms B+ Rating on INR1.5MM Loan ------------------------------------------------------------ CRISIL Ratings has been consistently following up with Kewin Chemicals Private Limited (KCPL) for obtaining information through letters and emails dated January 23, 2017, and February 13, 2017, among others, apart from telephonic communication. However, the issuer has remained non cooperative. CRISIL thus gave these ratings: Amount Facilities (INR Mln) Ratings ---------- --------- ------- Cash Credit 1.5 CRISIL B+/Stable (Issuer Not Cooperating; Rating Reaffirmed) Foreign Discounting 7.0 CRISIL A4 (Issuer Not Bill Purchase Cooperating; Rating Reaffirmed) Proposed Long Term .04 CRISIL B+/Stable (Issuer Not Bank Loan Facility Cooperating; Rating Reaffirmed) Secured Overdraft .36 CRISIL B+/Stable (Issuer Not Facility Cooperating; Rating Reaffirmed) The investors, lenders and all other market participants should exercise due caution while using the rating assigned/reviewed with the suffix 'ISSUER NOT COOPERATING'. These ratings lack a forward looking component as it is arrived at without any management interaction and is based on best available or limited or dated information on the company. Detailed Rationale Despite repeated attempts to engage with the management, CRISIL failed to receive any information on either the financial performance or strategic intent of Kewin Chemicals Private Limited. This restricts CRISIL's ability to take a forward looking view on the credit quality of the entity. CRISIL believes that the information available for Kewin Chemicals Private Limited is consistent with 'Scenario 2' outlined in the 'Framework for Assessing Consistency of Information with CRISIL BB' category or lower. Based on the last available information, CRISIL has reaffirmed the rating at 'CRISIL B+/Stable/CRISIL A4'. Incorporated in 1999, KCPL is based in Ahmedabad (Gujarat) and owned and managed by brothers Mr. Devang Shah and Mr. Mitesh Shah. It trades in chemical intermediates, dyes, and pigments. KUMARAGIRI SPINNERSS: CRISIL Cuts Rating on INR37.20MM Loan to B ---------------------------------------------------------------- CRISIL Ratings has been consistently following up with Kumaragiri Spinnerss Private Limited (KSL) for obtaining information through letters and emails dated January 20, 2017 and February 10, 2017 among others, apart from telephonic communication. However, the issuer has remained non cooperative. CRISIL thus gave these ratings: Amount Facilities (INR Mln) Ratings ---------- --------- ------- Bank Guarantee .98 CRISIL A4 (Issuer Not Cooperating; Downgraded from 'CRISIL A4+') Cash Credit 18.50 CRISIL B/Stable (Issuer Not Cooperating; Downgraded from 'CRISIL BB+/Stable') Long Term Loan 37.20 CRISIL B/Stable (Issuer Not Cooperating; Downgraded from 'CRISIL BB+/Stable') The investors, lenders and all other market participants should exercise due caution while using the rating assigned/reviewed with the suffix 'ISSUER NOT COOPERATING'. These ratings lack a forward looking component as it is arrived at without any management interaction and is based on best available or limited or dated information on the company. Detailed Rationale Despite repeated attempts to engage with the management, CRISIL failed to receive any information on either the financial performance or strategic intent of Kumaragiri Spinnerss Private Limited. This restricts CRISIL's ability to take a forward looking view on the credit quality of the entity. CRISIL believes that the information available for Kumaragiri Spinnerss Private Limited is consistent with 'Scenario 1' outlined in the 'Framework for Assessing Consistency of Information with CRISIL B' category or lower. Based on the last available information, CRISIL has downgraded the rating at 'CRISIL B/Stable/CRISIL A4'. Incorporated in 2004 and promoted by Mr. T R Thangavelu, KSL manufactures cotton-and-polyester-blended yarn (blended typically in the ratio of 40:60). The company is based in Erode (Tamil Nadu). LEOFORTUNE INFRA: CRISIL Reaffirms D Rating on INR15MM Loan ----------------------------------------------------------- CRISIL Ratings has been consistently following up with Leofortune Infrabuildcon Private Limited (LIPL) for obtaining information through letters and emails dated February 8, 2017, and March 22, 2017, among others, apart from telephonic communication. However, the issuer has remained non cooperative. CRISIL thus gave these ratings: Amount Facilities (INR Mln) Ratings ---------- --------- ------- Term Loan 15 CRISIL D (Issuer Not Cooperating; Rating Reaffirmed) The investors, lenders and all other market participants should exercise due caution while using the rating assigned/reviewed with the suffix 'ISSUER NOT COOPERATING'. These ratings lack a forward looking component as it is arrived at without any management interaction and is based on best available or limited or dated information on the company. Detailed Rationale Despite repeated attempts to engage with the management, CRISIL failed to receive any information on either the financial performance or strategic intent of Leofortune Infrabuildcon Private Limited. This restricts CRISIL's ability to take a forward looking view on the credit quality of the entity. CRISIL believes that the information available for Leofortune Infrabuildcon Private Limited is consistent with 'Scenario 1' outlined in the 'Framework for Assessing Consistency of Information with CRISIL B' category or lower. Based on the last available information, CRISIL has reaffirmed the rating at 'CRISIL D'. LIPL was incorporated in 2009 by Mr. Pradeep K Swami, Mr. Sitapathy Chavali, Mr. Dhiren Savla, Mr. Prasad K Swami and Mr. Vasant D Bhambhaniya. The company is engaged in real estate development in Navi Mumbai. The company currently has three ongoing projects - Fortune Symphony, Fortune Calypso and Fortune Oriana. LOTUS INFRATECH: CRISIL Assigns 'B+' Rating to INR1.75MM Loan ------------------------------------------------------------- CRISIL Ratings has assigned its 'CRISIL B+/Stable/CRISIL A4' ratings to the bank loan facilities of Lotus Infratech (LI). Amount Facilities (INR Mln) Ratings ---------- --------- ------- Bank Guarantee 9.25 CRISIL A4 Overdraft 1.75 CRISIL B+/Stable The rating reflects its limited track record of operations, and its exposure to intense competition in the civil construction industry. These rating weaknesses are partially offset by the benefits that LI derives from its partners' extensive experience and its established relationships with key customers and suppliers. The rating also factors in its moderate financial risk profile marked by moderate capital structure and debt protection metrics and its moderate order book providing revenue visibility over the medium term. Key Rating Drivers & Detailed Description Weakness * Limited track record of operations: LI's scale of operations are modest with limited track record of operations, as indicated by its revenues of INR33 crores in fiscal 2017 (refers to financial year, April 1 to March 31) , its first full year of operations. * Intense competition in the construction industry. Construction and civil works sector is highly fragmented with the presence of very large companies as well as smaller local players. While large players operate in several sectors including roads, hydel projects, thermal plants and urban infrastructure, smaller players specialize in one or two business segments. Similarly, LI specializes in civil construction projects mainly in roads & over bridges and irrigation. Strengths * Partners' extensive experience and its established relationships with key customers and suppliers: LI is promoted and managed by Mr. N Srinivasa Rao who is engaged in civil construction work since 1994, which reflects large experience in the business and its established relationships with key customers and suppliers. * Moderate order book providing revenue visibility: LI has moderate unexecuted order book of INR50 crores as on May, 2017 to be executed over the next 12 months which provides moderate revenue visibility for the medium term. * Moderate financial risk profile: LI has moderate financial risk profile marked by estimated gearing of 0.3 times and moderate debt protection metrics with estimated net cash accruals to total debt (NCATD) and interest coverage of 0.89 times and 4.1 times, respectively for 2016-17. This is due to its moderate net cash accruals and higher debt contracted to meet its working capital requirements. Outlook: Stable CRISIL believes that LI will benefit over the medium term from the long standing experience of its partners and its established relationship with its key customers and suppliers. The outlook may be revised to 'Positive' if LI's revenues and profitability continue to improve while maintaining its capital structure. Conversely, the outlook may be revised to 'Negative' if LI's revenue and profitability deteriorates or if there is a delay in receipt of bills from various principal contractors leading deterioration in financial risk profile. Established in November, 2015 as a partnership firm, LI is engaged in civil construction mainly in activities like irrigation and roads & bridges. Based in Vijaywada (Andhra Pradesh), the firm is promoted and managed by Mr.N Srinivasa Rao. LI started its commercial operations in April, 2016. For fiscal 2017, LI is estimated to report profit after tax (PAT) of INR1.35 crores on net sales of INR33.9 crores. M.K. ROY: CRISIL Reaffirms 'B' Rating on INR5.42MM LT Loan ---------------------------------------------------------- CRISIL Ratings has been consistently following up with M. K. Roy and Bros. Project Private Limited (MKRBPPL) for obtaining information through letters and emails dated March 6, 2017, and March 22, 2017, among others, apart from telephonic communication. However, the issuer has remained non cooperative. CRISIL thus gave these ratings: Amount Facilities (INR Mln) Ratings ---------- --------- ------- Bank Guarantee 4.5 CRISIL A4 (Issuer Not Cooperating; Rating Reaffirmed) Cash Credit 5.15 CRISIL B/Stable (Issuer Not Cooperating; Rating Reaffirmed) Proposed Long Term 5.42 CRISIL B/Stable (Issuer Not Bank Loan Facility Cooperating; Rating Reaffirmed) Term Loan 0.18 CRISIL B/Stable (Issuer Not Cooperating; Rating Reaffirmed) The investors, lenders and all other market participants should exercise due caution while using the rating assigned/reviewed with the suffix 'ISSUER NOT COOPERATING'. These ratings lack a forward looking component as it is arrived at without any management interaction and is based on best available or limited or dated information on the company. Detailed Rationale Despite repeated attempts to engage with the management, CRISIL failed to receive any information on either the financial performance or strategic intent of M. K. Roy and Bros. Project Private Limited. This restricts CRISIL's ability to take a forward looking view on the credit quality of the entity. CRISIL believes that the information available for M. K. Roy and Bros. Project Private Limited is consistent with 'Scenario 1' outlined in the 'Framework for Assessing Consistency of Information with CRISIL B' category or lower. Based on the last available information, CRISIL has reaffirmed the rating at 'CRISIL B/Stable/CRISIL A4'. MKRBPPL, formed in 1989 as a proprietorship concern, was reconstituted as a private limited company in 2000. The company, promoted by Mr. M K Roy and family, is engaged in supply, design, fabrication, and erection of storage tanks, and laying of pipelines for transportation of petrochemical products; it also undertakes welding, testing, and repair works. METALLOY IMPEX: CRISIL Reaffirms 'B' Rating on INR8.25MM Loan ------------------------------------------------------------- CRISIL Ratings has been consistently following up with Metalloy Impex (MI) for obtaining information through letters and emails dated February 7, 2017, and March 6, 2017, among others, apart from telephonic communication. However, the issuer has remained non cooperative. CRISIL thus gave these ratings: Amount Facilities (INR Mln) Ratings ---------- --------- ------- Bill Purchase- .75 CRISIL A4 (Issuer Not Discounting Cooperating; Rating Facility Reaffirmed) Cash Credit 8.25 CRISIL B/Stable (Issuer Not Cooperating; Rating Reaffirmed) The investors, lenders and all other market participants should exercise due caution while using the rating assigned/reviewed with the suffix 'ISSUER NOT COOPERATING'. These ratings lack a forward looking component as it is arrived at without any management interaction and is based on best available or limited or dated information on the company. Detailed Rationale Despite repeated attempts to engage with the management, CRISIL failed to receive any information on either the financial performance or strategic intent of Metalloy Impex. This restricts CRISIL's ability to take a forward looking view on the credit quality of the entity. CRISIL believes that the information available for Metalloy Impex is consistent with 'Scenario 1' outlined in the 'Framework for Assessing Consistency of Information with CRISIL B' category or lower. Based on the last available information, CRISIL has reaffirmed the rating at 'CRISIL B/Stable/CRISIL A4'. Established in 2011, MI trades in stainless steel scrap, ferrous and non-ferrous metal scrap. The firm sells its products primarily in Rajkot (Gujarat). The firm is promoted by Kishor Patel. MEWAR UNIVERSITY: CRISIL Reaffirms 'D' Rating on INR29.67MM Loan ---------------------------------------------------------------- CRISIL Ratings has reaffirmed its rating on the long-term bank facility of Mewar University (MU) at 'CRISIL D'. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Term Loan 29.67 CRISIL D (Reaffirmed) The rating continues to reflect delays in servicing debt on account of cash flow mismatch and tight liquidity. The trust also has geographical concentration in revenue and susceptibility to regulatory risks associated with educational institutions. However, MU benefits from the extensive experience of its trustees. Key Rating Drivers & Detailed Description Weakness * Delays in servicing term debt due to cash flow mismatch and tight liquidity: Delays in realisation of large receivables (against government scholarships) and uneven cash flow led to constrained liquidity, which resulted in delays in debt servicing. * Exposure to intense competition and geographical concentration in revenue: MU has to compete with other educational institutes. Also, entire income comes from a single campus in Chittorgarh, Rajasthan. * Vulnerability to regulatory risks associated with educational institutions: Courses offered by MU have to comply with specific operational and infrastructure norms set by regulatory bodies such as the All India Council for Technical Education and state authorities. This leads to significant compliance requirements and restricts any substantial increase in revenue. Strengths * Established regional position in the education sector: MU is backed by the reputation of Mewar Education Society (MES), which has presence of over a decade in the education segment. MU was set up in 2008 in Chittorgarh under MES and became an autonomous university in 2009. It offers degrees in engineering, computer application, management and law. MES is only a sponsoring body with six members on MU's board. For fiscal 2016, surplus was INR10 crore on income of INR42.6 crore, against INR13.8 crore and INR48.2 crore, respectively, in the previous fiscal. MOHAN GEMS: CRISIL Reaffirms D Rating on INR225MM Term Loan ----------------------------------------------------------- CRISIL Ratings has been consistently following up with Mohan Gems and Jewels Private Limited (MGJPL) for obtaining information through letters and emails dated January 24, 2017, and February 14, 2017, among others, apart from telephonic communication. However, the issuer has remained non cooperative. CRISIL thus gave these ratings: Amount Facilities (INR Mln) Ratings ---------- --------- ------- Cash Credit 100 CRISIL D (Issuer Not Cooperating; Rating Reaffirmed) Funded Interest 25 CRISIL D (Issuer Not Term Loan Cooperating; Rating Reaffirmed) Working Capital 225 CRISIL D (Issuer Not Term Loan Cooperating; Rating Reaffirmed) The investors, lenders and all other market participants should exercise due caution while using the rating assigned/reviewed with the suffix 'ISSUER NOT COOPERATING'. These ratings lack a forward looking component as it is arrived at without any management interaction and is based on best available or limited or dated information on the company. Detailed Rationale Despite repeated attempts to engage with the management, CRISIL failed to receive any information on either the financial performance or strategic intent of Mohan Gems and Jewels Private Limited. This restricts CRISIL's ability to take a forward looking view on the credit quality of the entity. CRISIL believes that the information available for Mohan Gems and Jewels Private Limited is consistent with 'Scenario 1' outlined in the 'Framework for Assessing Consistency of Information with CRISIL B' category or lower. Based on the last available information, CRISIL has reaffirmed the rating at 'CRISIL D'. MGJPL, promoted by Mr. Murari Lal Soni, is a private limited company incorporated in 2006. It manufactures gold jewellery ranging from 18 to 24 carats. The company also has a retail showroom in the Karol Bagh area of Delhi. NOVA AGRI: CRISIL Assigns 'B' Rating to INR4MM Cash Loan -------------------------------------------------------- CRISIL Ratings has revoked the suspension of its ratings on the bank facilities of Nova Agri Sciences (P) Limited (NASPL) and has assigned its 'CRISIL B/Stable' rating to the facilities. CRISIL had, on September 27, 2016, suspended the rating as NASPL had not provided information required for a rating review. NASPL has now shared the requisite information, enabling CRISIL to assign a rating to its bank facilities. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Cash Credit 4 CRISIL B/Stable (Assigned; Suspension Revoked) Term Loan 2.5 CRISIL B/Stable (Assigned; Suspension Revoked) The rating reflects NASPL's exposure to risks inherent in domestic agrochemicals market, fluctuations in raw material prices, successful acceptance of its new products and weak financial risk profile. These rating weaknesses are partially offset by the extensive industry experience of its promoters. Key Rating Drivers & Detailed Description Weaknesses * Exposure to risks inherent in domestic agrochemicals market, fluctuations in raw material prices, and successful acceptance of its new products: The industry is marked by intense price and product competition from local players and multi-national companies. Acceptability of the product is yet to be seen. NSAPL's operating margin will remain susceptible to high competition from domestic players and increase in raw material prices. * Weak financial risk profile: NASPL has weak financial risk profile marked by modest net worth and below-average debt protection metrics. Strengths * Extensive industry experience of the promoters: NSAPL is aided by the extensive experience of its promoters in the manufacturing, and marketing of bio fertilizers and micro nutrients for a period of over a decade. Outlook: Stable CRISIL believes that NASPL will benefit over the medium term from the extensive industry experience of its promoters. The outlook may be revised to 'Positive' if the company records higher revenues and profitability, leading to improvement in its financial risk profile. Conversely, the outlook may be revised to 'Negative' if there is decline in profitability resulting in weakening of its financial risk profile. Incorporated in the year 2010, NASPL is engaged in the business of manufacturing of pesticides both liquids and wettable powders. Promoted by Mr. Mohammed Ali and Mr. Yeluri Sambasiva Rao, the company is operates a unit at Singannaguda, Medak district (Telangana). Net loss was INR0.11 crore on revenue of INR2.33 crore in fiscal 2017, against net loss of INR0.2 crore on revenue of INR0.75 crore in fiscal 2016. ONE STOP ENTERTAINMENT: CRISIL Reaffirms 'B' on INR8MM Term Loan ---------------------------------------------------------------- CRISIL has been consistently following up with One Stop Entertainment Private Limited (OSEPL) for obtaining information through letters and emails dated February 7, 2017, and March 22, 2017, among others, apart from telephonic communication. However, the issuer has remained non cooperative. CRISIL thus gave these ratings: Amount Facilities (INR Mln) Ratings ---------- --------- ------- Term Loan 8 CRISIL B/Stable (Issuer Not Cooperating; Rating Reaffirmed) The investors, lenders and all other market participants should exercise due caution while using the rating assigned/reviewed with the suffix 'ISSUER NOT COOPERATING'. These ratings lack a forward looking component as it is arrived at without any management interaction and is based on best available or limited or dated information on the company. Detailed Rationale Despite repeated attempts to engage with the management, CRISIL failed to receive any information on either the financial performance or strategic intent of One Stop Entertainment Private Limited. This restricts CRISIL's ability to take a forward looking view on the credit quality of the entity. CRISIL believes that the information available for One Stop Entertainment Private Limited is consistent with 'Scenario 3' outlined in the 'Framework for Assessing Consistency of Information with CRISIL BBB' category or lower. Based on the last available information, CRISIL has reaffirmed the rating at 'CRISIL B/Stable'. Incorporated in 2010, OSEPL is setting up a resort-cum- entertainment centre on the outskirts of Bhopal (Madhya Pradesh). The promoter, Mr. Avneet Singh Marwaha, oversees OSEPL's daily operations. ORISSA DIESEL: CRISIL Reaffirms B+ Rating on INR3.12MM Loan ----------------------------------------------------------- CRISIL Ratings has been consistently following up with Orissa Diesel Engines Private Limited (ODEPL) for obtaining information through letters and emails dated March 6, 2017, and March 22, 2017, among others, apart from telephonic communication. However, the issuer has remained non cooperative. CRISIL thus gave these ratings: Amount Facilities (INR Mln) Ratings ---------- --------- ------- Bank Guarantee 0.7 CRISIL A4 (Issuer Not Cooperating; Rating Reaffirmed) Cash Credit 3.3 CRISIL B+/Stable (Issuer Not Cooperating; Rating Reaffirmed) Corporate Loan 0.29 CRISIL B+/Stable (Issuer Not Cooperating; Rating Reaffirmed) Electronic Dealer 3.12 CRISIL B+/Stable (Issuer Not Financing Scheme Cooperating; Rating (e-DFS) Reaffirmed) Proposed Long Term 0.32 CRISIL B+/Stable (Issuer Not Bank Loan Facility Cooperating; Rating Reaffirmed) Term Loan 0.47 CRISIL B+/Stable (Issuer Not Cooperating; Rating Reaffirmed) The investors, lenders and all other market participants should exercise due caution while using the rating assigned/reviewed with the suffix 'ISSUER NOT COOPERATING'. These ratings lack a forward looking component as it is arrived at without any management interaction and is based on best available or limited or dated information on the company. Detailed Rationale Despite repeated attempts to engage with the management, CRISIL failed to receive any information on either the financial performance or strategic intent of Orissa Diesel Engines Private Limited. This restricts CRISIL's ability to take a forward looking view on the credit quality of the entity. CRISIL believes that the information available for Orissa Diesel Engines Private Limited is consistent with 'Scenario 2' outlined in the 'Framework for Assessing Consistency of Information with CRISIL BB' category or lower. Based on the last available information, CRISIL has reaffirmed the rating at 'CRISIL B+/Stable/CRISIL A4'. Set up in 1992, ODEPL is an authorised dealer of Ashok Leyland Ltd (ALL) in Bhubaneswar, Puri, Nayaghar, Ganjam, and Gajpati (all in Odisha). The company also deals in spare parts, and provides servicing facilities for ALL and Force Motors Ltd, as well as for other principals such as Tourbo Energy Ltd and Simpson & Company Ltd. The company has recently entered the three-wheeler market by taking up dealership of Atul Auto Ltd (rated 'CRISIL A/Stable'). The operations are managed by Mr. A K Patnaik. PANDA INFRAPROJECT: CRISIL Reaffirms B Rating on INR15MM Loan ------------------------------------------------------------- CRISIL Ratings has been consistently following up with Panda Infraproject Limited (PIPL) for obtaining information through letters and emails dated March 6, 2017, and March 22, 2017, among others, apart from telephonic communication. However, the issuer has remained non cooperative. CRISIL Ratings thus gave these ratings: Amount Facilities (INR Mln) Ratings ---------- --------- ------- Bank Guarantee 10 CRISIL A4 (Issuer Not Cooperating; Rating Reaffirmed) Cash Credit 15 CRISIL B/Stable (Issuer Not Cooperating; Rating Reaffirmed) The investors, lenders and all other market participants should exercise due caution while using the rating assigned/reviewed with the suffix 'ISSUER NOT COOPERATING'. These ratings lack a forward looking component as it is arrived at without any management interaction and is based on best available or limited or dated information on the company. Detailed Rationale Despite repeated attempts to engage with the management, CRISIL failed to receive any information on either the financial performance or strategic intent of Panda Infraproject Limited. This restricts CRISIL's ability to take a forward looking view on the credit quality of the entity. CRISIL believes that the information available for Panda Infraproject Limited is consistent with 'Scenario 1' outlined in the 'Framework for Assessing Consistency of Information with CRISIL B' category or lower. Based on the last available information, CRISIL has reaffirmed the rating at 'CRISIL B/Stable/CRISIL A4'. PIPL was founded in September 2002 by Odisha-based Mr. Pratap Kishore Panda and his wife Ms. Sujata Panda. The company constructs and repairs roads in Balasore, Keonjhar, and Khurda in Odisha. It also repairs buildings. PRACHIN FOUNDATION: CRISIL Reaffirms 'D' Rating on INR7.09MM Loan ----------------------------------------------------------------- CRISIL Ratings has been consistently following up with Prachin Foundation for obtaining information through letters and emails dated January 23, 2017, and February 13, 2017, among others, apart from telephonic communication. However, the issuer has remained non cooperative. CRISIL thus gave these ratings: Amount Facilities (INR Mln) Ratings ---------- --------- ------- Long Term Loan 7.09 CRISIL D (Issuer Not Cooperating; Rating Reaffirmed) Proposed Long Term 2.91 CRISIL D (Issuer Not Bank Loan Facility Cooperating; Rating Reaffirmed) The investors, lenders and all other market participants should exercise due caution while using the rating assigned/reviewed with the suffix 'ISSUER NOT COOPERATING'. These ratings lack a forward looking component as it is arrived at without any management interaction and is based on best available or limited or dated information on the company. Detailed Rationale Despite repeated attempts to engage with the management, CRISIL failed to receive any information on either the financial performance or strategic intent of Prachin Foundation. This restricts CRISIL's ability to take a forward looking view on the credit quality of the entity. CRISIL believes that the information available for Prachin Foundation is consistent with 'Scenario 1' outlined in the 'Framework for Assessing Consistency of Information with Crisil B Rating category.or Lower' Therefore, on account of inadequate information and lack of management co- operation, CRISIL is Reaffirming the rating at 'CRISIL D'. Prachin, based in Hyderabad (Telangana), was established by Mr. G Satyanarayana in June 2009. The society has a franchisee agreement with GIFL, Singapore, to manage the Global Indian International School. The school offers education from pre-school to high school level. Its operations are managed by Mr. A Venkateswara Rao. R T EXPORTS: CRISIL Reaffirms 'D' Rating on INR14.95MM Term Loan ---------------------------------------------------------------- CRISIL Ratings has been consistently following up with R T Exports Limited (RTEL) for obtaining information through letters and emails dated January 23, 2017, and February 13, 2017, among others, apart from telephonic communication. However, the issuer has remained non cooperative. CRISIL thus gave this rating: Amount Facilities (INR Mln) Ratings ---------- --------- ------- Term Loan 14.95 CRISIL D (Issuer Not Cooperating; Rating Reaffirmed) The investors, lenders and all other market participants should exercise due caution while using the rating assigned/reviewed with the suffix 'ISSUER NOT COOPERATING'. These ratings lack a forward looking component as it is arrived at without any management interaction and is based on best available or limited or dated information on the company. Detailed Rationale Despite repeated attempts to engage with the management, CRISIL failed to receive any information on either the financial performance or strategic intent of R T Exports Limited . This restricts CRISIL's ability to take a forward looking view on the credit quality of the entity. CRISIL believes that the information available for R T Exports Limited is consistent with 'Scenario 1' outlined in the 'Framework for Assessing Consistency of Information with Crisil B Rating category.or Lower' Therefore, on account of inadequate information and lack of management co- operation, CRISIL is Reaffirming the rating at 'CRISIL D'. RTEL was incorporated in 1980 and has since been engaged in the export of agri products, mainly Basmati rice. The company also has a warehouse facility in Bundi (Rajasthan), which it leases out to Food Corporation of India (FCI) and some other clients. RAGHAV COTSPIN: CRISIL Reaffirms 'B' Rating on INR22MM Loan ----------------------------------------------------------- CRISIL Ratings has been consistently following up with Raghav Cotspin Private Limited (RCPL) for obtaining information through letters and emails dated January 27, 2017, and March 3, 2017, among others, apart from telephonic communication. However, the issuer has remained non cooperative. CRISIL thus gave these ratings: Amount Facilities (INR Mln) Ratings ---------- --------- ------- Cash Credit 8 CRISIL B/Stable (Issuer Not Cooperating; Rating Reaffirmed) Term Loan 22 CRISIL B/Stable (Issuer Not Cooperating; Rating Reaffirmed) The investors, lenders and all other market participants should exercise due caution while using the rating assigned/reviewed with the suffix 'ISSUER NOT COOPERATING'. These ratings lack a forward looking component as it is arrived at without any management interaction and is based on best available or limited or dated information on the company. Detailed Rationale Despite repeated attempts to engage with the management, CRISIL failed to receive any information on either the financial performance or strategic intent of Raghav Cotspin Private Limited. This restricts CRISIL's ability to take a forward looking view on the credit quality of the entity. CRISIL believes that the information available for Raghav Cotspin Private Limited is consistent with 'Scenario 1' outlined in the 'Framework for Assessing Consistency of Information with CRISIL B' category or lower. Based on the last available information, CRISIL has reaffirmed the rating at 'CRISIL B/Stable'. Incorporated in 2013, RCPL is promoted by the Gondal (Gujarat)- based Gajera family. The company is setting up a unit to spin cotton yarn of 30s count, which is expected to commence operations in April 2016. RAJPAL CARGO: CRISIL Reaffirms B+ Rating on INR5MM Cash Loan ------------------------------------------------------------ CRISIL Ratings has been consistently following up with Rajpal Cargo Movers Private Limited (RCMPL) for obtaining information through letters and emails dated February 8, 2017, and March 22, 2017, among others, apart from telephonic communication. However, the issuer has remained non cooperative. CRISIL thus gave these ratings: Amount Facilities (INR Mln) Ratings ---------- --------- ------- Cash Credit 5 CRISIL B+/Stable (Issuer Not Cooperating; Rating Reaffirmed) Proposed Long Term 2.23 CRISIL B+/Stable (Issuer Not Bank Loan Facility Cooperating; Rating Reaffirmed) The investors, lenders and all other market participants should exercise due caution while using the rating assigned/reviewed with the suffix 'ISSUER NOT COOPERATING'. These ratings lack a forward looking component as it is arrived at without any management interaction and is based on best available or limited or dated information on the company. Detailed Rationale Despite repeated attempts to engage with the management, CRISIL failed to receive any information on either the financial performance or strategic intent of Rajpal Cargo Movers Private Limited. This restricts CRISIL's ability to take a forward looking view on the credit quality of the entity. CRISIL believes that the information available forRajpal Cargo Movers Private Limited is consistent with 'Scenario 3' outlined in the 'Framework for Assessing Consistency of Information with CRISIL BBB' category or lower. Based on the last available information, CRISIL has reaffirmed the rating at 'CRISIL B+/Stable'. RCMPL was incorporated in 2000 as Rajpal Cargo Movers South Pvt Ltd by Mr. Surinder Singh and his family members and was renamed as Rajpal Cargo Movers Pvt Ltd in 2004. It provides inland logistics (by road) services, mainly to steel manufacturing companies in Karnataka and Maharashtra. RAM MEHER: CRISIL Reaffirms B+ Rating on INR5.1MM LT Loan --------------------------------------------------------- CRISIL Ratings has been consistently following up with Ram Meher Infradevelopers Private Limited (RMIPL) for obtaining information through letters and emails dated February 6, 2017, and March 27, 2017, 2017, among others, apart from telephonic communication. However, the issuer has remained non cooperative. CRISIL thus gave these ratings: Amount Facilities (INR Mln) Ratings ---------- --------- ------- Overdraft 1.4 CRISIL B+/Stable (Issuer Not Cooperating; Rating Reaffirmed) Proposed Long Term 5.1 CRISIL B+/Stable (Issuer Not Bank Loan Facility Cooperating; Rating Reaffirmed) Term Loan 5.0 CRISIL B+/Stable (Issuer Not Cooperating; Rating Reaffirmed) The investors, lenders and all other market participants should exercise due caution while using the rating assigned/reviewed with the suffix 'ISSUER NOT COOPERATING'. These ratings lack a forward looking component as it is arrived at without any management interaction and is based on best available or limited or dated information on the company. Detailed Rationale Despite repeated attempts to engage with the management, CRISIL failed to receive any information on either the financial performance or strategic intent of Ram Meher Infradevelopers Private Limited. This restricts CRISIL's ability to take a forward looking view on the credit quality of the entity. CRISIL believes that the information available for Ram Meher Infradevelopers Private Limited is consistent with 'Scenario 3' outlined in the 'Framework for Assessing Consistency of Information with CRISIL BBB' category or lower. Based on the last available information, CRISIL has reaffirmed the rating at 'CRISIL B+/Stable'. RMIPL was incorporated in 2009 by the Agra based family. The company is engaged into residential real estate development in Agra. The company is being promoted by Mr. Ram Vinod Singh, Mr. Ravi Singhal, Mr. Girish Chand Goyal and Mr. Nitish Goyal. The company is implementing a residential real estate project with total cost of INR206.7 million. The project was launched on January 2015 and is expected to be completed by June 2018. SAAKAAR CONSTRUCTIONS: CRISIL Reaffirms B Rating on INR5MM Loan --------------------------------------------------------------- CRISIL Ratings has reaffirmed its rating on the long-term bank facility of Saakaar Constructions Private Limited (SCPL) at 'CRISIL B/Stable'. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Overdraft 5 CRISIL B/Stable (Reaffirmed) The rating continues to reflect slow booking progress in its ongoing project, resulting in subdued flow of advances, and exposure to risks and cyclicality inherent in the real estate sector. These weaknesses are partially offset by promoters' extensive experience in the real estate industry and established brand in Patna (Bihar). Key Rating Drivers & Detailed Description Weaknesses * Slow booking progress in ongoing project resulting in demand and funding risks: The ongoing project is exposed to demand and funding risks as slowdown in demand has resulted in low bookings. This has also led to slower flow of advances, leading to high funding risk. * Exposure to risks and cyclicality inherent in the real estate industry: PPPL remains exposed to inherent risks and cyclicality associated with the Indian real estate industry because of a highly fragmented market structure due to the presence of several regional players. Strength * Extensive experience of promoters and established brand: The promoters' experience of over two decades has helped them developed good understanding of industry dynamics. Furthermore, longstanding presence has enabled establishment of, Saakaar, as a brand in Patna. Outlook: Stable CRISIL believes SCPL will continue to benefit over the medium term from its promoters' extensive experience. The outlook may be revised to 'Positive' in case of higher-than-expected cash flow from operations, resulting from accelerated booking of its projects and improved flow of advances along with adequate construction progress. Conversely, the outlook may be revised to 'Negative' if significantly lower-than-expected cash flow from operations, either because of subdued response to its project or lower-than-envisaged flow of advances, weakens the financial risk profile, particularly liquidity. Incorporated in October 1996, SCPL develops residential real estate in Patna. It sells its projects under the Saakaar brand. Mr Sudip Kumar, Mrs Smita Choudhury, Mr Jitendra Nath Gupta, Ms Usha Agarwal, and Mr Ravi Talwar are the directors. For fiscal 2016, SCPL reported a profit after tax of INR1.48 crore on an operating income of INR19.21 crore against INR0.74 crore and INR17.08 crore, respectively, for the previous fiscal. SATYA JEWELLERS: CRISIL Reaffirms B Rating on INR3MM Cash Loan -------------------------------------------------------------- CRISIL Ratings has been consistently following up with Satya Jewellers (SJ) for obtaining information through letters and emails dated February 8, 2017, and March 22, 2017, among others, apart from telephonic communication. However, the issuer has remained non cooperative. CRISIL thus gave these ratings: Amount Facilities (INR Mln) Ratings ---------- --------- ------- Cash Credit 3 CRISIL B/Stable (Issuer Not Cooperating; Rating Reaffirmed) Long Term Loan 1.72 CRISIL B/Stable(Issuer Not Cooperating; Rating Reaffirmed) Overdraft 2 CRISIL A4 (Issuer Not Cooperating; Rating Reaffirmed) Proposed Long Term .28 CRISIL B/Stable (Issuer Not Bank Loan Facility Cooperating; Rating Reaffirmed) The investors, lenders and all other market participants should exercise due caution while using the rating assigned/reviewed with the suffix 'ISSUER NOT COOPERATING'. These ratings lack a forward looking component as it is arrived at without any management interaction and is based on best available or limited or dated information on the company. Detailed Rationale Despite repeated attempts to engage with the management, CRISIL failed to receive any information on either the financial performance or strategic intent of Satya Jewellers. This restricts CRISIL's ability to take a forward looking view on the credit quality of the entity. CRISIL believes that the information available for Satya Jewellers is consistent with 'Scenario 1' outlined in the 'Framework for Assessing Consistency of Information with CRISIL B' category or lower. Based on the last available information, CRISIL has reaffirmed the rating at 'CRISIL B/Stable/CRISIL A4'. SJ, a proprietorship concern, was established in 1980 by Mr. Shelender Verma. The firm retails gold and diamond-studded jewellery through its establishment in Mall Road, Shimla. SHIVA GRAMODYOG: CRISIL Reaffirms B Rating on INR2.5MM Loan ----------------------------------------------------------- CRISIL Ratings has been consistently following up with Shiva Gramodyog Sewa Sansthan (SGSS) for obtaining information through letters and emails dated February 8, 2017, and March 22, 2017, among others, apart from telephonic communication. However, the issuer has remained non cooperative. CRISIL thus gave these ratings: Amount Facilities (INR Mln) Ratings ---------- --------- ------- Proposed Fund- 2.5 CRISIL B/Stable (Issuer Not Based Bank Limits Cooperating; Rating Reaffirmed) The investors, lenders and all other market participants should exercise due caution while using the rating assigned/reviewed with the suffix 'ISSUER NOT COOPERATING'. These ratings lack a forward looking component as it is arrived at without any management interaction and is based on best available or limited or dated information on the company. Detailed Rationale Despite repeated attempts to engage with the management, CRISIL failed to receive any information on either the financial performance or strategic intent of Shiva Gramodyog Sewa Sansthan. This restricts CRISIL's ability to take a forward looking view on the credit quality of the entity. CRISIL believes that the information available for Shiva Gramodyog Sewa Sansthan is consistent with 'Scenario 1' outlined in the 'Framework for Assessing Consistency of Information with CRISIL B' category or lower. Based on the last available information, CRISIL has reaffirmed the rating at 'CRISIL B/Stable'. SGSS set up as a not-for-profit society, is managed by its secretary Mr. Rajender Kumar and chairperson Mr. Jogshewar Singh. Located in Kanpur district (Uttar Pradesh), the society is engaged in various schemes operated by the state and central governments in Kanpur and surrounding areas. The schemes include running the National Urban Livelihood Mission (NULM), old-age home, shelter home scheme, Kishori Shakti Yojana, providing training to Anganwadi teachers, and some other government-mandated schemes. SHRADDHA GEMS: CRISIL Reaffirms B+ Rating on INR2.25MM Loan ----------------------------------------------------------- CRISIL Ratings has been consistently following up with Shraddha Gems for obtaining information through letters and emails dated February 8, 2017, and March 6, 2017, among others, apart from telephonic communication. However, the issuer has remained non cooperative. CRISIL thus gave these ratings: Amount Facilities (INR Mln) Ratings ---------- --------- ------- Export Packing Credit 2.25 CRISIL B+/Stable (Issuer Not Cooperating; Rating Reaffirmed) Post Shipment Credit 5.25 CRISIL A4 (Issuer Not Cooperating; Rating Reaffirmed) The investors, lenders and all other market participants should exercise due caution while using the rating assigned/reviewed with the suffix 'ISSUER NOT COOPERATING'. These ratings lack a forward looking component as it is arrived at without any management interaction and is based on best available or limited or dated information on the company. Detailed Rationale Despite repeated attempts to engage with the management, CRISIL failed to receive any information on either the financial performance or strategic intent of Shraddha Gems. This restricts CRISIL's ability to take a forward looking view on the credit quality of the entity. CRISIL believes that the information available for Shraddha Gems is consistent with 'Scenario 2' outlined in the 'Framework for Assessing Consistency of Information with CRISIL BB' category or lower. Based on the last available information, CRISIL has reaffirmed the rating at 'CRISIL B+/Stable/CRISIL A4'. Shraddha, set up in 1990 as a partnership firm, is engaged in cutting and polishing of diamonds. The firm also trades in polished diamonds. The firm derives around 60 per cent of its revenues from trading in diamonds, and the balance 40 per cent from processing of diamonds. The firm currently has four partners Mr. Ashwin Sanghvi, Mr. Babulal Shah, Mrs. Chetna Shah and Mrs. Sonal Shah. SHREE VISHWAKARMA: CRISIL Reaffirms 'B' Rating on INR6MM Loan ------------------------------------------------------------- CRISIL Ratings has been consistently following up with Shree Vishwakarma Cold Storage (SVCS) for obtaining information through letters and emails dated February 8, 2017, and March 22, 2017, among others, apart from telephonic communication. However, the issuer has remained non cooperative. CRISIL thus gave these ratings: Amount Facilities (INR Mln) Ratings ---------- --------- ------- Overdraft 6 CRISIL B/Stable (Issuer Not Cooperating; Rating Reaffirmed) The investors, lenders and all other market participants should exercise due caution while using the rating assigned/reviewed with the suffix 'ISSUER NOT COOPERATING'. These ratings lack a forward looking component as it is arrived at without any management interaction and is based on best available or limited or dated information on the company. Detailed Rationale Despite repeated attempts to engage with the management, CRISIL failed to receive any information on either the financial performance or strategic intent of Shree Vishwakarma Cold Storage. This restricts CRISIL's ability to take a forward looking view on the credit quality of the entity. CRISIL believes that the information available for Shree Vishwakarma Cold Storage is consistent with 'Scenario 1' outlined in the 'Framework for Assessing Consistency of Information with CRISIL B' category or lower. Based on the last available information, CRISIL has reaffirmed the rating at 'CRISIL B/Stable'. SVCS is a partnership firm set up in 1998 by Mr. Chamanlal Rugnathji, Mr. Velaji Rugnathji, Mr. Thanaji Shankarji, Mr. Rugnathji Dharmaji, and Mr. Chunilal Haraji. The firm is based at Deesa, Banaskantha (Gujarat). It trades in potatoes and also provides a cold storage facility for potatoes with a capacity of 13,500 tonnes. SHRI GURU: CRISIL Reaffirms 'B' Rating on INR5MM Cash Loan ---------------------------------------------------------- CRISIL Ratings has been consistently following up with Shri Guru Stone Crusher Private Limited (SGSCPL) for obtaining information through letters and emails dated February 8, 2017, and March 22, 2017, among others, apart from telephonic communication. However, the issuer has remained non cooperative. CRISIL thus gave these ratings: Amount Facilities (INR Mln) Ratings ---------- --------- ------- Cash Credit 5 CRISIL B/Stable (Issuer Not Cooperating; Rating Reaffirmed) Term Loan 3 CRISIL B/Stable (Issuer Not Cooperating; Rating Reaffirmed) The investors, lenders and all other market participants should exercise due caution while using the rating assigned/reviewed with the suffix 'ISSUER NOT COOPERATING'. These ratings lack a forward looking component as it is arrived at without any management interaction and is based on best available or limited or dated information on the company. Detailed Rationale Despite repeated attempts to engage with the management, CRISIL failed to receive any information on either the financial performance or strategic intent of Shri Guru Stone Crusher Private Limited. This restricts CRISIL's ability to take a forward looking view on the credit quality of the entity. CRISIL believes that the information available for Shri Guru Stone Crusher Private Limited is consistent with 'Scenario 1' outlined in the 'Framework for Assessing Consistency of Information with CRISIL B' category or lower. Based on the last available information, CRISIL has reaffirmed the rating at 'CRISIL B/Stable'. Incorporated in 2012, the Rudrapur (Uttarakhand)-based SGSCPL is promoted by Mr. Satnam Singh Bedi. It crushes boulders, picked up from Kosi and Dabka river beds, at its crushing unit into stones of various sizes (up to 65 millimetres); the unit began commercial operations from September 2014. The company is managed by Mr. Satnam Singh Bedi, Mr. Jasvinder Singh Bedi, and Mr. Hemant Dwivedi. SHRI RAM: CRISIL Assigns B+ Rating to INR3.0MM LT Loan ------------------------------------------------------ CRISIL Ratings has assigned its 'CRISIL B+/Stable/CRISIL A4' ratings to the bank facilities of Shri Ram Autotech Private Limited (SRAPL). The rating reflects the company's average financial risk profile, and susceptibility to cyclicality in the automobile industry. These weaknesses are partially offset by its promoters' extensive experience in the automobile components industry. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Overdraft 4.5 CRISIL A4 Proposed Long Term Bank Loan Facility 3.0 CRISIL B+/Stable Key Rating Drivers & Detailed Description Weaknesses * Average financial risk profile: Debt protection metrics are moderate, with interest coverage and net cash accrual to term debt ratios estimated at 2.2 times and 0.13 time, respectively, in fiscal 2017. Gearing was high, estimated at 3 times as on March 31, 2017. * Susceptibility to cyclicality in the automobile industry: The company derives its entire revenue from the automobile industry, which is inherently cyclical with performance linked to the economy. The industry recently underwent a sharp downturn after four years of robust sales growth, on account of high financing cost, sharp contraction in credit, and macroeconomic slowdown. Strength * Extensive industry experience of the promoters: The promoters' experience of more than two decades in the automotive components business has helped them build healthy relationships with customers and suppliers. Outlook: Stable CRISIL believes SRAPL will continue to benefit from its longstanding presence in the automobile components industry and established relationships with customers. The outlook may be revised to 'Positive' if a considerable increase in revenue, and improvement in profitability and working capital cycle, lead to higher-than-expected cash accrual, and hence, to a better financial risk profile. The outlook may be revised to 'Negative' if revenue or profitability declines, leading to lower-than- expected cash accrual, weakening the financial risk profile, particularly liquidity. SRAPL, incorporated in 2010, manufactures automotive components such as sheet metals, plastic moulded components, flanges, jigs, and fixtures. It was established as a proprietorship firm in 1992 and was reconstituted as a private limited company in 2010. Its manufacturing units are in Gurgaon and Faridabad in Haryana. The company is promoted by Mr Rajesh Sharma, Mr Kartik Sharma, Mr Santosh Sharma and Mr Mohit Sharma. The company reported profit after tax of INR35 lacs on operating income of INR36.27 crores as on 2015-16 as against PAT of INR3 lac on operating income of INR17.82 crores in 2014-15. The company reported operating income on provisional basis of INR60.8 crores in 2016-17. SRI VARALAKSHMI: CRISIL Reaffirms 'B' Rating on INR2.65MM Loan -------------------------------------------------------------- CRISIL Ratings has been consistently following up with Sri Varalakshmi Solvent Oils Private Limited (SVSOPL) for obtaining information through letters and emails dated February 8, 2017, and March 22, 2017, among others, apart from telephonic communication. However, the issuer has remained non cooperative. CRISIL thus gave these ratings: Amount Facilities (INR Mln) Ratings ---------- --------- ------- Cash Credit 6 CRISIL B/Stable (Issuer Not Cooperating; Rating Reaffirmed) Proposed Cash 1.35 CRISIL B/Stable (Issuer Not Credit Limit Cooperating; Rating Reaffirmed) Term Loan 2.65 CRISIL B/Stable (Issuer Not Cooperating; Rating Reaffirmed) The investors, lenders and all other market participants should exercise due caution while using the rating assigned/reviewed with the suffix 'ISSUER NOT COOPERATING'. These ratings lack a forward looking component as it is arrived at without any management interaction and is based on best available or limited or dated information on the company. Detailed Rationale Despite repeated attempts to engage with the management, CRISIL failed to receive any information on either the financial performance or strategic intent of Sri Varalakshmi Solvent Oils Private Limited. This restricts CRISIL's ability to take a forward looking view on the credit quality of the entity. CRISIL believes that the information available for Sri Varalakshmi Solvent Oils Private Limited is consistent with 'Scenario 1' outlined in the 'Framework for Assessing Consistency of Information with CRISIL B' category or lower. Based on the last available information, CRISIL has reaffirmed the rating at 'CRISIL B/Stable'. SVSOPL, incorporated in 2010, manufactures rice bran oil. SVSOPL, promoted by Mr. Visweswara Rao and family, has its plant in Kotabammali, Andhra Pradesh. The commercial operations started from January 2012. SUNRISE PROCESS: CRISIL Reaffirms B Rating on INR3MM Cash Loan -------------------------------------------------------------- CRISIL has reaffirmed its 'CRISIL B/Stable/CRISIL A4' ratings on the bank facilities of Sunrise Process Equipments (SPE). Amount Facilities (INR Mln) Ratings ---------- --------- ------- Cash Credit 3 CRISIL B/Stable (Reaffirmed) Letter Of Guarantee 1.75 CRISIL A4 (Reaffirmed) Letter of Credit 1.75 CRISIL A4 (Reaffirmed) Packing Credit .25 CRISIL A4 (Reaffirmed) Proposed Long Term Bank Loan Facility 3.25 CRISIL B/Stable (Reaffirmed) The ratings continue to reflect the firm's modest scale of operations and below-average financial risk profile because of small net worth, moderate gearing, and subdued debt protection metrics. These weaknesses are partially offset by the extensive experience of its proprietor in the pharmaceutical and chemical equipment segment. Key Rating Drivers & Detailed Description Weakness * Modest scale of operations: With net sales of INR9.92 crore for fiscal 2017, scale remains small, which limits advantages of economies of scale available to players with larger volumes. Subdued scale will continue to constrain business risk profile over the medium term. * Below-average financial risk profile: Gearing is estimated to be moderate at 1.3 times and net worth small at INR4.2 crore as on March 31, 2017. Debt protection metrics were weak, with estimated net cash accrual to total debt and interest coverage ratios of over 0.08 time and 1.55 times, respectively, for fiscal 2017. Strengths * Extensive experience of proprietor: Presence of more than two decades in the equipment manufacturing industry has enabled the proprietor to establish strong relationship with customers and suppliers. Proprietor's experience will help maintain a stable business risk profile over the medium term. Outlook: Stable CRISIL believes SPE will continue to benefit over the medium term from the extensive experience of its proprietor. The outlook may be revised to 'Positive' in case of significant and sustainable growth in revenue, while maintaining operating margin and improving capital structure. The outlook may be revised to 'Negative' if decline in revenue or operating margin, stretch in working capital cycle, or large, debt-funded capital expenditure further weakens financial risk profile. Established in 1998 as a proprietorship concern by Mr. N Chaudhari, SPE manufactures machinery and equipment for the pharmaceutical and chemical sectors at its unit in Thane, Maharashtra. Estimated profit after tax (PAT) was INR32 lakh on net sales of INR9.92 crore for fiscal 2017; PAT was INR15 lakh on net sales of INR6.79 crore for fiscal 2016. SURENDRA MINING: CRISIL Lowers Rating on INR55.2MM Term Loan to B ----------------------------------------------------------------- CRISIL Ratings has been consistently following up with Surendra Mining Industries Private Limited (SMIPL) for obtaining information through letters and emails dated February 6, 2017, and March 22, 2017, among others, apart from telephonic communication. However, the issuer has remained non cooperative. CRISIL thus gave these ratings: Amount Facilities (INR Mln) Ratings ---------- --------- ------- Term Loan 55.2 CRISIL B/Stable (Issuer Not Co-operating; Downgraded from 'CRISIL BB+/Stable') The investors, lenders and all other market participants should exercise due caution while using the rating assigned/reviewed with the suffix 'ISSUER NOT COOPERATING'. These ratings lack a forward looking component as it is arrived at without any management interaction and is based on best available or limited or dated information on the company. Detailed Rationale Despite repeated attempts to engage with the management, CRISIL failed to receive any information on either the financial performance or strategic intent of Surendra Mining Industries Private Limited. This restricts CRISIL's ability to take a forward looking view on the credit quality of the entity. CRISIL believes that the information available for Surendra Mining Industries Private Limited is consistent with 'Scenario 1' outlined in the 'Framework for Assessing Consistency of Information with CRISIL B' rating category or lower. Based on the last available information, CRISIL has downgraded the rating at 'CRISIL B/Stable'. For arriving at the rating, CRISIL has combined the business and financial risk profiles of SMIPL and Vishal Metallics Pvt Ltd (VMPL). This is because the two companies, together referred to as the Surendra Mining group, are in the same line of business. Furthermore, any shortfall in sponge iron requirement for SMIPL's newly started billet manufacturing unit is planned to be met from VMPL. Besides, both the companies will be merged over the medium term, as indicated by the management. SMIPL, incorporated in 2004, commenced operations as a manufacturer of sponge iron with an installed capacity of 60,000 tonnes per annum (tpa) in Odisha. In January 2014, the company forward integrated with the commencement of commercial operations of its 90,000-tpa steel billet plant and 12-megawatt captive power plant. The company belongs to the SN Mohanty group, which has been in the business of iron ore mining in Odisha for over four decades. VMPL also manufactures sponge iron with an installed capacity of 60,000 tpa; its facility is located adjacent to SMIPL's plant. SUVILAS PROPERTIES: CRISIL Reaffirms 'B' Rating on INR35MM Loan --------------------------------------------------------------- CRISIL Ratings has been consistently following up with Suvilas Properties Pvt. Ltd. (SPPL) for obtaining information through letters and emails dated February 8, 2017, and February 23, 2017, among others, apart from telephonic communication. However, the issuer has remained non cooperative. Amount Facilities (INR Mln) Ratings ---------- --------- ------- Project Loan 35 CRISIL B/Stable (Issuer Not Cooperating; Rating Reaffirmed) The investors, lenders and all other market participants should exercise due caution while using the rating assigned/reviewed with the suffix 'ISSUER NOT COOPERATING'. These ratings lack a forward looking component as it is arrived at without any management interaction and is based on best available or limited or dated information on the company. Detailed Rationale Despite repeated attempts to engage with the management, CRISIL failed to receive any information on either the financial performance or strategic intent of Suvilas Properties Pvt. Ltd.. This restricts CRISIL's ability to take a forward looking view on the credit quality of the entity. CRISIL believes that the information available for Suvilas Properties Pvt. Ltd. is consistent with 'Scenario 1' outlined in the 'Framework for Assessing Consistency of Information with CRISIL B' category or lower. Based on the last available information, CRISIL has reaffirmed the rating at 'CRISIL B/Stable'. SPPL is a Bengaluru (Karnataka)-based real estate Development Company incorporated in 2012. Its day-to-day operations are managed by the managing director Mr. Sunil Chowdary. VINAYAK MINERALS: CRISIL Reaffirms B Rating on INR3MM Term Loan --------------------------------------------------------------- CRISIL Ratings has been consistently following up with Vinayak Minerals (VM) for obtaining information through letters and emails dated January 31, 2017, and March 3, 2017, among others, apart from telephonic communication. However, the issuer has remained non cooperative. CRISIL thus gave these ratings: Amount Facilities (INR Mln) Ratings ---------- --------- ------- Cash Credit 1.5 CRISIL B/Stable (Issuer Not Cooperating; Rating Reaffirmed) Proposed Long Term .5 CRISIL B/Stable (Issuer Not Bank Loan Facility Cooperating; Rating Reaffirmed) Proposed Short Term 1 CRISIL A4 (Issuer Not Bank Loan Facility Cooperating; Rating Reaffirmed) Term Loan 3 CRISIL B/Stable (Issuer Not Cooperating; Rating Reaffirmed) The investors, lenders and all other market participants should exercise due caution while using the rating assigned/reviewed with the suffix 'ISSUER NOT COOPERATING'. These ratings lack a forward looking component as it is arrived at without any management interaction and is based on best available or limited or dated information on the company. Detailed Rationale Despite repeated attempts to engage with the management, CRISIL failed to receive any information on either the financial performance or strategic intent of Vinayak Minerals. This restricts CRISIL's ability to take a forward looking view on the credit quality of the entity. CRISIL believes that the information available for Vinayak Minerals is consistent with 'Scenario 3' outlined in the 'Framework for Assessing Consistency of Information with CRISIL BBB' category or lower. Based on the last available information, CRISIL has reaffirmed the rating at 'CRISIL B/Stable/CRISIL A4'. Set up in February 2015 as a partnership firm, VM is promoted by Mr. Uttam Vadhadiya and others. The firm is setting up a facility to produce ceramic body clay with a capacity of 90,000 tonnes per annum. ========= J A P A N ========= TAKATA: Bankruptcy Would Cloud Auto Industry's Biggest Recall ------------------------------------------------------------- Kevin Buckland, Masatsugu Horie, and Ryan Beene at Bloomberg News report that the expected bankruptcy of troubled air-bag maker Takata Corp. isn't just a crisis for its employees and suppliers. It also throws a wild card into one of the biggest and most complicated recalls in automotive history, the report says. Bloomberg says the Japan-based auto supplier has pledged to recall and replace tens of millions of defective air-bag inflators used by 19 car and truck makers around the world, from Tesla Inc. to Toyota Motor Corp. Bloomberg relates that a filing to restructure in U.S. bankruptcy court, which could come as early as today, June 26, according to people familiar with the matter, doesn't relieve a manufacturer of recall responsibilities. However, should its financial assets be exhausted before all the work is done, carmakers may have to cover the difference. U.S. bankruptcy laws permit a would-be buyer to acquire Takata's desirable assets, but not necessarily assume unwanted liabilities -- including recall obligations, Bloomberg relates citing Robert Rasmussen, a University of Southern California law professor specializing in corporate reorganizations. Funds raised by an asset sale would go toward funding Takata's production of replacement parts, Mr. Rasmussen, as cited by Bloomberg, said. U.S. law treats a manufacturer's recall obligations in bankruptcy as a claim of the U.S. government and they receive priority "to ensure that consumers are adequately protected from any safety defect" in a manufacturer's products, according to statute. "The big risk is how much are the assets worth versus what's the cost to do the replacements," Bloomberg quotes Mr. Rasmussen as saying. Scott Upham, president of Valient Market Research, estimates that automakers and suppliers globally face $5 billion in future costs tied to the recalls, about $2 billion of which can be tied to Takata. He estimates a Takata asset sale will generate about $1.5 billion to $2 billion, Bloomberg discloses. "There's not enough money," Bloomberg quotes Mr. Upham as saying. Automakers may have to cover any shortfall, Mr. Upham said. Bloomberg notes that the car companies have already shifted business away from Takata and toward rivals for about 70% of the parts to repair the millions of vehicles recalled for the company's defective airbag inflators, which can explode with too much force and spray drivers and passengers with metal and plastic shards. That should assure enough new inflators for the estimated 100 million defective ones forecast to be replaced worldwide. Only 38 percent of the 43 million air bag inflators under recall in the U.S. had been repaired as of May 26, Bloomberg discloses citing data on the U.S. Department of Transportation's National Highway Traffic Safety Administration website. In Japan, 73% of the close to 19 million air bags under recall have been repaired, a spokesman at the country's transport ministry said this month. At least 17 deaths have been linked to the devices worldwide. Mounting liabilities associated with the faulty airbags have forced Takata to seek a buyer that would see it through a costly restructuring process, says Bloomberg. A Takata steering committee has recommended Key Safety Systems Inc. -- the U.S. air-bag maker owned by China's Ningbo Joyson Electronic Corp. -- as the preferred bidder, and bankruptcy filings would bring the Japanese company a step closer to a sale, according to Bloomberg. The challenges for the acquirer are manifold, Bloomberg notes. Takata posted its third-straight annual loss even without including the full costs of repairing millions of air bags, which automakers are now paying for, Bloomberg says. It faces a talent exodus and auto industry distrust, the report adds. "It would be hard for Key Safety Systems to put in huge amounts of money if there's no guarantee against unexpected liabilities, after any deal," Bloomberg quotes Mitsuhiro Harada, a researcher at Tokyo Shoko Research, as saying. "Takata is making money in non-airbag operations, so if they can drastically cut recall- related debt through bankruptcy, they can surely revive soon." Automakers have avoided supply disruptions by sourcing replacement parts from Takata competitors Autoliv Inc., ZF-TRW and Daicel Corp. Autoliv, for example, has already provided 15 million replacement inflators and has orders for another 15 million into 2019, company spokesman Thomas Jonsson said, Bloomberg relays. "We are working with suppliers to ensure a steady supply of replacement inflators for our customers," Bloomberg quotes Kelly Stefanich, a Toyota spokeswoman in Princeton, Indiana, as saying. "We don't anticipate any supply disruptions at this time." Honda Chief Executive Officer Takahiro Hachigo said at a June 16 media briefing that the automaker hasn't heard any specifics about the Takata bankruptcy plan. The Japanese government has said it's focused on completing the recall process and ensuring there's no disruption of the supply chain, adds Bloomberg. About Takata Corp Japan-based Takata Corporation (TYO:7312) -- http://www.takata.com/en/-- develops, manufactures and sells safety products for automobiles. The Company offers seatbelts, airbags, steering wheels, child seats and trim parts. The Company has subsidiaries located in Japan, the United States, Brazil, Germany, Thailand, Philippines, Romania, Singapore, Korea, China and other countries. In May 1995, a voluntary recall in the U.S. affecting 8 million predominantly Japanese built vehicles made from 1986 to 1991 with seat belts manufactured by the Takata was conducted. Large recalls of vehicles due to faulty Takata-made airbags began in 2013. Takata is presently facing massive costs of recalling 100 million defective airbag inflators worldwide and lawsuits tied to at least 16 deaths and numerous injuries. As of May 19, 2015, Takata has already recalled 40 million vehicles across 12 vehicle brands for defective airbags. In November 2015, Takata was fined $200 million by U.S. federal regulators for mishandling the way it recalled its air bag inflators. The fine is the largest civil penalty in NHTSA history. TOSHIBA CORP: Demoted to Tokyo Exchange's Second Tier ----------------------------------------------------- Nikkei Asian Review reports that Toshiba Corp. shares will be reassigned to the Tokyo Stock Exchange's second section on Aug. 1, the bourse said on June 23, demoting the industrial group after yet another delay in the release of its latest annual results. According to the report, Toshiba on June 23 postponed issuing its securities report for the year ended March 31 until Aug. 10. The Kanto Local Finance Bureau approved the extension beyond the June 30 deadline, Nikkei says. This marks the fifth time the Tokyo-based company has pushed back the release of the report and quarterly earnings statements, the report notes. Nikkei says the TSE requires companies with negative shareholder equity to be demoted to the second section -- a rule that Sharp ran afoul of last year. The latter company is now readying to apply to return to the first section, the report states. A drop down to the second section means a company is automatically removed from the Nikkei Stock Average and the broader Topix index, according to Nikkei. Nikkei adds that Toshiba also on June 23 revised up its estimated negative shareholder equity as of the March fiscal-year-end to JPY581.6 billion ($5.22 billion) from JPY540 billion. Its forecast group net loss widened to JPY995.2 billion from JPY950 billion owing to increased provisions against litigation and higher loan guarantee liabilities for Westinghouse Electric, a former subsidiary that filed for Chapter 11 bankruptcy protection in the U.S. in March. Toshiba's delays in finalizing its annual results reflect continued disagreement with auditor PricewaterhouseCoopers Aarata over when to recognize losses on Westinghouse nuclear power plant projects, Nikkei states. Nikkei adds that the TSE is probing Toshiba's internal controls and will wait for the securities report before determining whether to maintain the company's listing. A decision is not expected until September at the earliest, the report says. Toshiba President Satoshi Tsunakawa told reporters that the industrial group "is working to strengthen our internal controls, and we hope to keep our position as a listed company," adds Nikkei. About Toshiba Toshiba Corporation (TYO:6502) -- http://www.toshiba.co.jp/-- is a Japan-based manufacturer involved in five business segments. The Digital Products segment offers cellular phones, hard disc devices, optical disc devices, liquid crystal televisions, camera systems, digital versatile disc (DVD) players and recorders, personal computers (PCs) and business phones, among others. The Electronic Device segment provides general logic integrated circuits (ICs), optical semiconductors, power devices, large- scale integrated (LSI) circuits for image information systems and liquid crystal displays (LCDs), among others. The Social Infrastructure segment offers various generators, power distribution systems, water and sewer systems, transportation systems and station automation systems, among others. The Home Appliance segment offers refrigerators, drying machines, washing machines, cooking utensils, cleaners and lighting equipment. The Others segment leases and sells real estate. As reported in the Troubled Company Reporter-Asia Pacific on June 19, 2017, S&P Global Ratings said it has kept its 'CCC-' long-term and 'C' short-term ratings on Japan-based capital goods and diversified electronics company Toshiba Corp. on CreditWatch with negative implications. The long- and short-term ratings on Toshiba have remained on CreditWatch with negative implications since December 2016, when S&P also lowered the long-term ratings because of a likelihood that the company might recognize massive losses in its U.S. nuclear power business. S&P kept them on CreditWatch negative when it lowered the long- and short-term ratings in January 2017 and when S&P lowered the long-term ratings in March 2017. The ratings remain on CreditWatch, reflecting S&P's view that creditor banks' support for Toshiba together with the company's liquidity levels warrant continued close monitoring because its plan to sell its memory business has yet to materialize and additional losses or financial burdens might still arise in connection with its U.S. nuclear power business. S&P continues to hold the view that without unanticipated, significantly favorable changes in Toshiba's circumstances, the company might become unable to fulfill its financial obligations in a timely manner or might undertake a debt restructuring S&P classifies as distressed in the next six months. TOSHIBA CORP: Chip Unit Deal 'Not Finished', SK Chairman Says ------------------------------------------------------------- Yonhap News Agency reports that SK Group Chairman Chey Tae-won said on June 23 its semiconductor arm's move to join the acquisition of Toshiba Corp.'s chip business is "not finished," hinting there are still challenges moving forward. Yonhap relates that the remark came as a global consortium including South Korea's SK hyinx Inc. was tapped as the preferred bidder for the sale of the memory arm of Japanese tech giant Toshiba earlier last week. The consortium included Japanese players and U.S. Bain Capital. Taking anti-monopoly regulations into account, SK hynix is expected to join the consortium by offering loans, instead of directly contributing to buy the chipmaking operation, Yonhap notes. According to Yonhap, Mr. Chey's remarks come as many in the industry said the arrangement could face hurdles down the road, as U.S.-based Western Digital filed a request for arbitration with an international court, demanding exclusive negotiation rights. Japanese media reported that Toshiba is seeking to have Western Digital join the consortium, which would emerge as yet another variable for the deal, Yonhap says. If SK hynix secures at least half of Toshiba's shares, it will immediately grow to become the second-largest player in the NAND market, although it is more likely to only take over 15% of the combined stake in the consortium, Yonhap states. Even with this modest share, the deal can play a crucial role in the company's efforts to seek sustainable growth and position itself well going forward, the industry watchers said, adds Yonhap. About Toshiba Toshiba Corporation (TYO:6502) -- http://www.toshiba.co.jp/-- is a Japan-based manufacturer involved in five business segments. The Digital Products segment offers cellular phones, hard disc devices, optical disc devices, liquid crystal televisions, camera systems, digital versatile disc (DVD) players and recorders, personal computers (PCs) and business phones, among others. The Electronic Device segment provides general logic integrated circuits (ICs), optical semiconductors, power devices, large- scale integrated (LSI) circuits for image information systems and liquid crystal displays (LCDs), among others. The Social Infrastructure segment offers various generators, power distribution systems, water and sewer systems, transportation systems and station automation systems, among others. The Home Appliance segment offers refrigerators, drying machines, washing machines, cooking utensils, cleaners and lighting equipment. The Others segment leases and sells real estate. As reported in the Troubled Company Reporter-Asia Pacific on June 19, 2017, S&P Global Ratings said it has kept its 'CCC-' long-term and 'C' short-term ratings on Japan-based capital goods and diversified electronics company Toshiba Corp. on CreditWatch with negative implications. The long- and short-term ratings on Toshiba have remained on CreditWatch with negative implications since December 2016, when S&P also lowered the long-term ratings because of a likelihood that the company might recognize massive losses in its U.S. nuclear power business. S&P kept them on CreditWatch negative when it lowered the long- and short-term ratings in January 2017 and when S&P lowered the long-term ratings in March 2017. The ratings remain on CreditWatch, reflecting S&P's view that creditor banks' support for Toshiba together with the company's liquidity levels warrant continued close monitoring because its plan to sell its memory business has yet to materialize and additional losses or financial burdens might still arise in connection with its U.S. nuclear power business. S&P continues to hold the view that without unanticipated, significantly favorable changes in Toshiba's circumstances, the company might become unable to fulfill its financial obligations in a timely manner or might undertake a debt restructuring S&P classifies as distressed in the next six months. =============== M O N G O L I A =============== GOLOMT BANK: S&P Affirms 'B-' ICR; Outlook Revised to Stable ------------------------------------------------------------ S&P Global Ratings revised its outlooks on Trade And Development Bank of Mongolia LLC (TDB) and Golomt Bank of Mongolia to stable from negative. At the same time, S&P affirmed its 'B-' long-term and 'B' short-term issuer credit ratings on both the Mongolian banks. In addition, S&P affirmed its 'B-' long-term and 'B' short-term issue ratings on TDB's debt. S&P also affirmed its 'B-' long-term and 'B' short-term issuer credit ratings on Development Bank of Mongolia (DBM). The outlook on DBM remains stable. The rating actions reflect S&P's view that the Mongolian banking industry's reliance on external funding has reduced even though overall funding conditions remain tight. S&P has revised its view of the country's banking sector industry risk trend to stable from negative. In S&P's base case, it expects that the banking sector's two-year average net external debt as a percentage of total domestic loans will peak by end-2017 and then trend below 20%, the threshold supporting our current assessment. S&P's assessment of industry risk also considers the banking sector's slowing loan growth and declining foreign currency loans. These trends reduce the need for banks to issue cross-border foreign currency bonds to finance their domestic loan growth. S&P also notes that the International Monetary Fund's funding program and the successful refinancing of DBM's U.S. dollar-denominated bond in March 2017 improved external funding conditions and confidence. In S&P's opinion, dependence on cross-border funding can destabilize the Mongolian banking sector's overall funding profile, particularly during times of distress when access to liquidity can be restricted. S&P continues to view Mongolia's debt capital markets to be narrow and shallow. Domestically, the competition for core customer deposits, the key source of funding for banks, remains tight at around 56% of system loans (including corporate loans made by DBM, which are not funded by customer deposits) at the end of 2016. While S&P expects this ratio to slightly decline over the next couple of years, S&P believes its current funding risk assessment adequately captures this risk. The economic risk trend for Mongolia remains stable and at the extremely high risk level. S&P's assessment reflects the country's low income per capita, still increasing banking sector credit losses, declining house prices, cyclical exposures to the volatile mining sector, weak payment culture, and unfavorable rule of law for creditors. S&P sees the economy to be still in a correction phase, along with the continuation of current account deficit. S&P expects these trends to continue over the next couple of years with longer-term improvement potential depending on successful new government policies and foreign direct investment. Mongolia is a small, narrowly diversified economy with low income levels and high reliance on the mining sector. The economy is also vulnerable to the commodity cycle. Solid long-term economic growth prospects due to abundant natural resources, together with some progress in economic stabilization temper these weaknesses. TRADE AND DEVELOPMENT BANK OF MONGOLIA LLC The revised outlook on TDB reflects the improved industry funding conditions, which S&P believes will have a positive effect on the bank's operations. S&P expects TDB to maintain its overall credit profile over the next 18-24 months despite some asset quality pressures in line with the industry trend. The affirmed rating considers the bank's strong market position, which is moderated by a very low risk-adjusted capital ratio and large corporate loan concentrations. GOLOMT BANK OF MONGOLIA The revised outlook on Golomt also reflects the likely positive effect on the bank's operations from improved industry funding conditions. S&P expects Golomt to maintain its overall credit profile over the next 18-24 months notwithstanding its higher appetite for loan growth and some pressure on asset quality in line with the industry trend. The affirmed rating on Golomt reflects the combination of the bank's improved management and governance and weakening capital and earnings. S&P's positive revision of Golomt's management governance score lifts a previous constraint to its strong business position. At the same time, S&P revised downward its assessment of the bank's capital and earnings to very weak from weak primarily due to expected thinning of capital buffers from high credit growth notwithstanding potential capital replenishing plans. DEVELOPMENT BANK OF MONGOLIA The affirmed rating on DBM with stable outlook reflects S&P's assessment of the bank's almost certain likelihood of extraordinary government support. This is given DBM's critical role of financing projects for Mongolia's economic development and its integral link with the government despite the recent change in its balance sheet structure. The DBM law was recently revised--a measure to render it more financially independent and better able to sustainably achieve its policy functions. The revision resulted in a shrunken balance sheet, removing the bank's quasi- fiscal related activities and carving out government budget supported loans from its portfolio. The rating and outlook on DBM is equalized with those on the Mongolia sovereign and S&P no longer maintains a stand-alone credit profile on DBM noting it is not a significant rating driver given the bank's government- related entity status. BICRA Score Snapshot SCORE To From BICRA* 10 10 Economic Risk* 10 10 Economic Risk Trend Stable Stable Economic Resilience Very high risk Very high risk Economic Imbalances Very high risk Very high risk Credit Risk In The Economy Extremely high risk Extremely high risk Industry Risk* 9 9 Industry Risk Trend Stable Negative Institutional Framework Extremely high risk Extremely high risk Competitive Dynamics High risk High risk Systemwide Funding Very high risk Very high risk *On a scale of 1 (lowest risk) to 10 (highest risk) Ratings List Ratings Affirmed; CreditWatch/Outlook Action To From Golomt Bank of Mongolia Issuer Credit Rating B-/Stable/B B-/Neg./B Trade and Development Bank of Mongolia LLC Issuer Credit Rating B-/Stable/B B-/Neg./B Ratings Affirmed Development Bank of Mongolia Issuer Credit Rating B-/Stable/B Trade and Development Bank of Mongolia LLC Senior Unsecured B- Short-Term Debt B ==================== S O U T H K O R E A ==================== MAGNACHIP SEMICONDUCTOR: S&P Raises CCR to 'B-'; Outlook Stable --------------------------------------------------------------- S&P Global Ratings raised its long-term corporate credit rating on MagnaChip Semiconductor Corp. to 'B-' from 'CCC+'. The outlook is stable. At the same time, S&P raised its issue rating on the company's US$225 million notes due 2021 to 'B-' from 'CCC+'. MagnaChip is a Korea-based analog and mixed-signal semiconductor designer and manufacturer. S&P upgraded MagnaChip mainly because it expects the company to strengthen its operating and financial performances over the next one to two years. The improvement is primarily due to steady demand growth in MagnaChip's major businesses and ongoing cost- reduction efforts. S&P believes that MagnaChip's improving internal cash flow generation has increased its capacity to manage its debts coming due in 2021 with better access to capital markets. But the company is still somewhat vulnerable to market volatility. In S&P's view, MagnaChip can grow its display solution business over the next two years because of the increasing adoption of AMOLED technology for smartphones and other devices, given the company's good relationship with the leading AMOLED panel makers. Also, S&P anticipates its foundry business to show improving profitability over the next 12 months mainly due to the high utilization rate in its facilities with stronger market demand. The company is currently making efforts to improve its operating efficiency through headcount reduction, and S&P expects this measure to affect its overall profitability somewhat positively from the second half of 2017. Under S&P's base case, it estimates MagnaChip can improve its operating margin to 3%-6% over the next one to two years, compared with 0.6% in 2016 and negative EBITDA in 2015. Notwithstanding this, S&P believes the company's operating performances are still susceptible to industry volatility because of its relatively small scale and less competitive technological capabilities. As such, S&P revised its assessment of the company's business risk profile to weak from vulnerable. S&P expects the recovery in MagnaChip's operating performance to steadily improve its financial metrics. However, given the company's high debt level and still relatively low profitability, S&P expects credit metrics to remain highly leveraged over the next one to two years. Under S&P's base case, it expects the company's adjusted debt-to-EBITDA ratio to be around 5x-7x in 2017 and 2018, compared with 8.8x in 2016. S&P believes MagnaChip's enhancing operating performance, if sustained, can improve its access to capital markets and leave the company in a better position to address its large debt maturities in 2021. The company's issuance of US$86 million exchangeable notes in January 2017 indicates its improving access and reduces its liquidity risk with a significant cash position. S&P has therefore revised its assessment on the company's liquidity to adequate from less than adequate. The stable outlook reflects S&P's expectation that MagnaChip will further recover its operating cash flows over the next one to two years, albeit at a modest pace, mainly due to demand growth in its display solution products and foundry business. S&P may lower the ratings if MagnaChip's profitability deteriorates significantly, possibly due to a material weakening of its market position or key customer relationships, and, as a result, S&P sees heightening risk on sustaining its highly leveraged capital structure. Significantly increasing liquidity risk and a rapidly shrinking cash level would also pressure the ratings. S&P could also lower the ratings if the company's financial policy, such as shareholders' returns, becomes significantly more aggressive than S&P factors into the current rating. S&P could raise the ratings if the company significantly improves operating profitability and generates positive free operating cash flows, resulting in its debt-to-EBITDA ratio approaching 4.0x on a sustainable basis. SK HYNIX: Moody's Says Toshiba Deal May Cut Financial Flexibility ----------------------------------------------------------------- Moody's Investors Service notes that SK Hynix Inc.'s (Ba1 positive) participation in a consortium selected as a preferred bidder for Toshiba Corporation's (Caa1 negative) memory business, Toshiba Memory Corporation (TMC). In Moody's view, the transaction and related cash outlays, if successful, would reduce SK Hynix's financial flexibility, while whether the company can have access to TMC's technology and cash flows is uncertain. However, the potential impact on SK Hynix's credit quality could be mitigated by the company's robust operating performance, assuming that it will have a minority stake in the consortium. Given tight supply and demand conditions in the memory chip market, Moody's expects that SK Hynix will generate around KRW12 trillion in operating cash flow in 2017. The company is planning around KRW7 trillion in capex. As a result, it will have excess cash to deploy. However, if the company assumes a significant share of funding for the consortium, such that it exceeds its free cash flow, pressure could arise on its rating and outlook. Toshiba and the consortium are seeking to come to a definitive agreement by June 28, and to close the transaction by March 2018, upon clearance of all the required processes, including competition law approvals in key jurisdictions. The positive outlook on SK Hynix's ratings continues to reflect the increasing resilience of the company's credit profile through industry cycles, underpinned by its solid market position in DRAM, very low leverage, and strong liquidity. The principal methodology used in this rating was Semiconductor Industry Methodology published in December 2015. SK Hynix Inc., a Korea-based company, is engaged in the design, manufacture and sale of memory chips, such as DRAM and NAND flash memory. It is 20.07%-owned by SK Telecom Co., Ltd. (A3 stable). ********* 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. 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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, Ivy B. Magdadaro and Peter A. Chapman, Editors. Copyright 2017. 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. 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