/raid1/www/Hosts/bankrupt/TCRAP

/raid1/www/Hosts/bankrupt/TCRAP_Public/181122.mbx T R O U B L E D C O M P A N Y R E P O R T E R A S I A P A C I F I C Thursday, November 22, 2018, Vol. 21, No. 232 Headlines A U S T R A L I A BIG REVIEW: Creditors Vote to Wind Up Business BOHEMIA CRYSTAL: Second Creditors' Meeting Set for Nov. 28 DAMPIER FINANCE: Convicted and Fined for Failure to File Results FINETUNE INVESTMENTS: Second Creditors' Meeting Set for Nov. 28 GFIN PTY: Second Creditors' Meeting Set for Nov. 28 MUNGI GROUP: First Creditors' Meeting Set for Nov. 29 OPEN SPATIAL: First Creditors' Meeting Set for Nov. 29 PINNACLE BUSINESS: First Creditors' Meeting Set for Nov. 28 STR TRUCK: First Creditors' Meeting Set for Nov. 29 VIADAR HOLDINGS: First Creditors' Meeting Set for Nov. 28 C H I N A CBAK ENERGY: Delays Filing of Third Quarter Form 10-Q HNA GROUP: To Sell Controlling Stake in Urumqi Airlines WINTIME ENERGY: $10 Billion Restructuring Plan Scaring Investors YANAN BICON: S&P Lowers ICR to 'CCC' on Refinancing Risk H O N G K O N G NOBLE GROUP: To Stick with Restructuring Deadline Despite Probe PRIME SOURCE: Allowed to Reject Commercial Lease with Peacock I N D I A A. RAMANATHAN: CRISIL Reaffirms B+ Rating on INR13cr Cash Loan ABZ AGRO: CRISIL Withdraws B+ Rating on INR30cr Loans AMAR JYOTHI: CRISIL Maintains 'B' Rating in Not Cooperating AQUA WORLD: CRISIL Reaffirms B+ Rating on INR9cr Packing Credit AVIRAT COTTON: CARE Reaffirms B+ Rating on INR17.30cr LT Loan B.G. TRANSPORT: Ind-Ra Maintains BB- LT Rating in Non-Cooperating BAJAJ PROCESSPACK: CARE Hikes Rating on INR4cr LT Loan to B+ BEE JAY: Ind-Ra Maintains BB- LT Issuer Rating in Non-Cooperating BHUPINDER SINGH: Ind-Ra Maintains BB- Rating in Non-Cooperating BLUE DUCK: Ind-Ra Maintains 'BB-' LT Rating in Non-Cooperating DHARIYA CONSTRUCTION: CRISIL Withdraws B Rating on INR12cr Loan ENCORP POWERTRANS: CRISIL Withdraws B Rating on INR9cr Loans ESSAR STEEL: GAIL Seeks Rejection of ArcelorMittal's Bid FULETRA AGRO: CARE Reaffirms B+ Rating on INR4.01cr LT Loan GAYATRI VIDYA: CARE Hikes Rating on INR76cr LT Loan to BB- GAZEBO INDUSTRIES: CRISIL Reaffirms B+ Rating on INR.75cr Loan GLOBAL ESTATES: CRISIL Maintains 'B' Rating in Not Cooperating GOPAL KRISHNA: Ind-Ra Maintains 'B' LT Rating in Non-Cooperating GVRMP WHAGDHARI: CRISIL Lowers Rating on INR202cr LT Loan to D HARSHA INTERNATIONAL: CARE Reaffirms B+ Rating on INR25cr Loan IRRILINK DRIP: CRISIL Maintains 'B-' Rating in Not Cooperating J B PUBLISHING: CRISIL Withdraws B+ Rating on INR17.5cr Loans JAI JALARAM: CRISIL Maintains 'B' Ratings in Not Cooperating JAYAHO AGRI: CRISIL Maintains 'D' Rating in Not Cooperating KHUSHI COTSPIN: CARE Assigns B+ Rating to INR9.19cr LT Loan LAKSHMI COT: CARE Reaffirms B+ Rating on INR13.10cr LT Loan LAMANE INFRA: Ind-Ra Maintains 'BB-' LT Rating in Non-Cooperating M.K.V.K. TIMBERS: CRISIL Reaffirms 'B' Rating on INR8.5cr Loan NAMAN METAL: CRISIL Assigns B+ Rating to INR6.25cr Cash Loan NEW AGE: CRISIL Lowers Rating on INR3cr Cash Loan to D PERFECT INFRAENGINEERS: Ind-Ra Affirms 'D' LT Issuer Rating PRAMODKUMAR PRAVINKUMAR: CARE Assigns B+ Rating to INR9.29cr Loan PSK TEXTILES: Ind-Ra Assigns BB+ LT Issuer Rating, Outlook Stable RANGOLI INDUSTRIES: CARE Assigns B+ Rating to INR12.50cr Loan RATHI SPECIAL: CRISIL Withdraws B Rating on INR28cr Cash Loan RATTAN KAUR: Ind-Ra Maintains 'BB-' LT Rating in Non-Cooperating SHREE DOODHAGANGA: Ind-Ra Assigns 'BB-' LT Rating, Outlook Stable SREE PADMANABHA: CARE Moves B+ Rating to Not Cooperating Category SRI M.K.V. KANDASAMY: CRISIL Reaffirms B Rating on INR6cr Loan TANVIRKUMAR & CO: CRISIL Hikes Rating on INR11.2cr LT Loan to B+ TEJINDER KAUR: Ind-Ra Maintains BB- LT Rating in Non-Cooperating UNNATI WRITING: CRISIL Withdraws 'B' Rating on INR10cr Loans VEDIKA AGRO: CRISIL Hikes Rating on INR10cr Loans to B+ S I N G A P O R E AVATION PLC: S&P Affirms 'B+' Long-Term ICR, Outlook Positive SWISSCO HOLDINGS: Judicial Management Extended Until March 30 S R I L A N K A SRI LANKA: Risks Debt Default Amid Political Crisis - - - - - ================= A U S T R A L I A ================= BIG REVIEW: Creditors Vote to Wind Up Business ---------------------------------------------- The Sydney Morning Herald reports that Big Review TV (BRT), the operating subsidiary of failed tech darling Big Un, is no more after the company was put into liquidation earlier this month and the business closed. Big Un could follow BRT into liquidation as early as today, Nov. 22, when the administrators are expected to make an announcement. Anthony Elkerton, one of BRT's appointed liquidators from DW Advisory, confirmed to The Sydney Morning Herald/The Age that the business had closed down after creditors voted to wind it up in early November, SMH relates. According to SMH, BRT had been handed back to its directors, Big Un founder Brandon Evertz and Sonia Thurston, after creditors approved a deed of company arrangement (DOCA) in June. These same creditors voted this month to wind up BRT and appoint the previously appointed administrators from DW Advisory as liquidators, after it failed to comply with parts of the agreement, including chasing up debtors for repayment, SMH says. SMH relates that Mr. Elkerton said the directors were not meeting their commitments "so we formed a view that it was not practical for the DOCA to continue". The business was shut down along with the remaining 20 employees, the report states. Big Un was the best-performing stock on the ASX in 2017. Its shares had increased nearly 20-fold for the year, or 2000 per cent, on claims it successfully charged small businesses thousands of dollars to make videos via BRT and post them on social media. "The company's just a basket-case," said one creditor who did not wish to be named, SMH relays. "I just don't think there was a business there." SMH notes that the collapse of BRT into liquidation is expected to see its parent company Big Un follow suit. Big Un is now unlikely to see any return from the AUD9.8 million it is owed by BRT. Big Un's father and son founders, Richard and Brandon Evertz, have made a claim for more than AUD1.5 million between them. This is separate to the AUD1.33 million termination payment that Richard Evertz is claiming from Big Un itself, SMH discloses. Doubts about the company's financial accounts surfaced in February, by which time the stock had more than halved in price. Anthony Elkerton and Cameron Gray of DW Advisory were appointed as administrators of Big Review on May 21, 2018. BOHEMIA CRYSTAL: Second Creditors' Meeting Set for Nov. 28 ---------------------------------------------------------- A second meeting of creditors in the proceedings of Bohemia Crystal Pty Ltd has been set for Nov. 28, 2018, at 10:00 a.m. at the offices of DW Advisory, at Level 2, 32 Martin Place, in Sydney, NSW. The purpose of the meeting is (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 Nov. 27, 2018, at 5:00 p.m. Ronald John Dean-Willcocks and Cameron Hamish Gray of DW Advisory were appointed as administrators of Bohemia Crystal on Oct. 24, 2018. DAMPIER FINANCE: Convicted and Fined for Failure to File Results ---------------------------------------------------------------- Sydney-based company Dampier Finance Australia Limited, who holds an Australian Financial Services licence (AFSL), has been fined AUD240,000 for failing to lodge its company annual reports and financial statements with Australian Securities and Investments Commission. On November 13, 2018, Dampier Finance Australia was found guilty in the Downing Centre Local Court of failing to submit annual financial reports with ASIC for the financial years ending 2012 to 2017, inclusive. Dampier was also found guilty of failing to prepare and lodge audited annual financial statements and balance sheets with ASIC for the same period. In failing to comply with its obligations to lodge annual reports and financial statements, the Magistrate stated that the fine imposed was justified, citing the serious and systemic nature of the offending. The Magistrate also added that the sentence provided for general and specific deterrence. The Commonwealth Director of Public Prosecutions prosecuted the matter. Investigations by ASIC into Dampier Finance Australia continue. Certain types of companies, which include public listed and unlisted companies and large property limited companies, have an obligation to lodge annual financial reports with ASIC within a prescribed period. Holders of Australian Financial Services licenses are required to prepare and lodge audited annual profit and loss statements and balance with ASIC within a prescribed period. Failing to lodge these reports within the prescribed period is a criminal offence. Dampier Finance Australia Limited AFSL number: 319331. FINETUNE INVESTMENTS: Second Creditors' Meeting Set for Nov. 28 --------------------------------------------------------------- A second meeting of creditors in the proceedings of Finetune Investments Pty Ltd as trustee for the Finetune No. 1 Unit Trust has been set for Nov. 28, 2018, at 11:00 a.m. at the offices of Ferrier Hodgson, at Level 28, 108 St Georges Terrace, in Perth, WA. The purpose of the meeting is (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 Nov. 27, 2018, at 4:00 p.m. Martin Bruce Jones and Andrew Michael Smith of Ferrier Hodgson were appointed as administrators of Finetune Investments on Oct. 24, 2018. GFIN PTY: Second Creditors' Meeting Set for Nov. 28 --------------------------------------------------- A second meeting of creditors in the proceedings of GFIN Pty Limited has been set for Nov. 28, 2018, at 11:00 a.m. at the offices of Pitcher Partners, at Level 22 MLC Centre, 19 Martin Place, in Sydney, NSW. The purpose of the meeting is (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 Nov. 27, 2018, at 4:00 p.m. Paul Gerard Weston of Pitcher Partners was appointed as administrator of GFIN Pty on Oct. 3, 2018. MUNGI GROUP: First Creditors' Meeting Set for Nov. 29 ----------------------------------------------------- A first meeting of the creditors in the proceedings of Mungi Group Pty Ltd, trading as Mungi Internet, will be held at Christie Conference Space, at 1/320 Adelaide Street, in Brisbane, Queensland, on Nov. 29, 2018, at 11:00 a.m. Brendan Nixon of SM Solvency Accountants was appointed as administrator of Mungi Group on Nov. 20, 2018. OPEN SPATIAL: First Creditors' Meeting Set for Nov. 29 ------------------------------------------------------ A first meeting of the creditors in the proceedings of Open Spatial Australia Pty Ltd, trading Geosential, will be held at the offices of Mackay Goodwin, at Level 2, 10 Bridge Street, in Sydney, NSW, on Nov. 29, 2018, at 12:00 p.m. Grahame Robert Ward of Mackay Goodwin was appointed as administrator of Open Spatial on Nov. 19, 2018. PINNACLE BUSINESS: First Creditors' Meeting Set for Nov. 28 ----------------------------------------------------------- A first meeting of the creditors in the proceedings of Pinnacle Business Advisory Pty Ltd will be held at CPA Australia, Level 3, 111 Harrington Street, in Sydney, NSW, on Nov. 28, 2018, at 10:00 a.m. Nicarson Natkunarajah of Roger and Carson Pty Limited was appointed as administrator of Pinnacle Business on Nov. 17, 2018. STR TRUCK: First Creditors' Meeting Set for Nov. 29 --------------------------------------------------- A first meeting of the creditors in the proceedings of STR Truck Bodies Pty Ltd, trading as STR Towing Equipment, STR Truck Bodies & Trailers and Kilar Towing Equipment, will be held at the offices of Mackay Goodwin, at Level 9, 440 Collins Street, in Melbourne, Victoria, on Nov. 29, 2018, at 4:00 p.m. Domenico Alessandro Calabretta, Grahame Robert Ward and Thyge Trafford-Jones of Mackay Goodwin were appointed as administrators of STR Truck on Nov. 19, 2018. VIADAR HOLDINGS: First Creditors' Meeting Set for Nov. 28 --------------------------------------------------------- A first meeting of the creditors in the proceedings of Viadar Holdings Pty Ltd will be held at the offices of Hayes Advisory, Level 16, 55 Clarence Street, in Sydney, NSW, on Nov. 28, 2018, at 11:00 a.m. Alan Hayes of Hayes Advisory was appointed as administrator of on Nov. 17, 2018. ========= C H I N A ========= CBAK ENERGY: Delays Filing of Third Quarter Form 10-Q ----------------------------------------------------- CBAK Energy Technology, Inc. said in a Form 12b-25 filed with the Securities and Exchange Commission that it has not finalized its financial statements for the quarter ended Sept. 30, 2018. As a result, the Company was unable to file its Form 10-Q within the prescribed time period without unreasonable effort or expense. The Company anticipates that it will file the Form 10-Q within the five-day grace period provided by Exchange Act Rule 12b-25. About CBAK Energy Dalian, China-based CBAK Energy Technology, Inc., formerly China BAK Battery, Inc. -- http://www.cbak.com.cn/-- is engaged in the business of developing, manufacturing and selling new energy high power lithium batteries, which are mainly used in the following applications: electric vehicles; light electric vehicles; and electric tools, energy storage, uninterruptible power supply, and other high power applications. CBAK Energy reported a net loss of US$21.46 million for the year ended Dec. 31, 2017 compared to a net loss of US$12.65 million for the year ended Sept. 30, 2016. As of June 30, 2018, the Company had US$135.68 million in total assets, US$139.20 million in total liabilities and a total deficit of US$3.51 million. Centurion ZD CPA Limited, in Hong Kong, China, the Company's auditor since 2016, issued a "going concern" opinion in its report on the consolidated financial statements for the year ended Dec. 31, 2017 stating that the Company has a working capital deficiency, accumulated deficit from recurring net losses and significant short-term debt obligations maturing in less than one year as of Dec. 31, 2017. All these factors raise substantial doubt about its ability to continue as a going concern. HNA GROUP: To Sell Controlling Stake in Urumqi Airlines ------------------------------------------------------- Don Weinland at The Financial Times reports that HNA, the sprawling Chinese conglomerate, is stepping up divestments and cancelling deals for airline services as it sheds tens of billions of dollars worth of assets including many of its core airline businesses. The FT relates that the company said this week that it would sell down its controlling stake in Urumqi Airlines from 70 per cent to 30 per cent. The Urumqi government will take on HNA's shares, the FT says. Earlier this month, HNA cancelled the purchase of a 60 per cent stake in Chongqing Western Airlines and last month, the Financial Times reported that the company planned to sell Lucky Airlines to two government-backed companies. HNA is also in talks to sell air services company Swissport International to Canada's Brookfield Asset Management, the FT notes. According to the FT, Hainan-based HNA grabbed global attention over the past four years by taking large stakes in companies including Deutsche Bank and Hilton Worldwide, part of a $40 billion acquisition binge that made it one of China's largest owners of overseas assets. But since coming under Chinese government scrutiny in mid-2017, due to concerns over the rapid build-up in debt associated with the buying spree, the group has unwound many of those deals, the report adds. The FT says HNA has shown clear signs of struggling under a burden of at least $78 billion in official debt -- a number that does not include its high-interest borrowing through peer-to-peer platforms -- accumulated during its rapid expansion. Since the start of the year, the group has sold off some RMB300 billion (US$43 billion) in assets, HNA chairman Chen Feng told journalists in China earlier this month. The FT relates that the rapid sales of aviation assets flies in the face of assurances from the company that it would only sell non-core businesses - ranging from financial services and trucking companies to office towers and golf courses - but would retain its core airline holdings. At the height of its dealmaking activity, HNA had purchased stakes in airlines across China and around the world. The conglomerate also bought into airports, logistics networks, banks and hotels in what many people close to the company viewed as an ambitious attempt to build a top-to-bottom business that spanned tourism, transport and finance. Advisers who worked closely with the group during that period have said HNA's current strategy and the future state of its business is unclear, the FT relays. HNA's leadership was shaken in July when the group's founder Wang Jian died after a fall while on holiday in France, the FT recalls. Wang was credited as the driving force behind many of the company's overseas acquisitions. In September, Mr. Chen promoted two close family members, tightening family control over the company in the aftermath of Wang's death, the FT says. About HNA Group China-based HNA Group Co. Ltd. offers airlines services. The Company provides domestic and international aviation transportation, air travel, aviation maintenance, and aviation logistics services. HNA Group also operates holding, capital, tourism, logistics, and other business. As reported in the Troubled Company Reporter-Asia Pacific on Sept. 17, 2018, the Financial Times said reports that the Chinese aviation-to-finance conglomerate defaulted on a CNY300 million (US$44 million) loan raised through a trust company, the lender said on Sept. 13 as it sought to freeze HNA assets. The FT said the announcement by Hunan Trust is a sign that HNA's liquidity woes are beginning to have a broader impact outside China's formal banking sector. According to the FT, the company is already under strict supervision by a group of bank creditors, led by China Development Bank, following a liquidity crunch in the final quarter of last year. The default came despite an estimated $18 billion in asset sales by HNA this year that have done little to address its ability to meet its domestic debts, the FT noted. WINTIME ENERGY: $10 Billion Restructuring Plan Scaring Investors ---------------------------------------------------------------- Carrie Hong and Ina Zhou at Bloomberg News report that a move by one of China's biggest corporate delinquents to include bonds sold by a healthier subsidiary in a workout proposal has stoked concerns about creditors' rights in a market still getting used to the concept of defaults. According to Bloomberg, Wintime Energy Co. by mid-2018 found itself incapable of servicing debt that quadrupled in less than five years. Now it's proposing the inclusion of a $500 million note sold by Huachen Energy Co. in a CNY70 billion (US$10 billion) overall restructuring package. Huachen hasn't defaulted on those offshore notes, and bundling them together with the obligations of its more sickly parent could appeal to Wintime creditors. Bloomberg relates that the move is less appealing to investors who had considered subsidiaries as independent issuers -- with their own balance sheets -- when it came to creditworthiness. Should the plan go ahead, a greater degree of due diligence may be needed as fund managers grapple with the implications of a record run of defaults in the world's third-largest bond market, Bloomberg says. "If substantive consolidation was applied in China in the Wintime case, without the consent of the offshore bondholders, it would certainly be very surprising," Bloomberg quotes Kingsley Ong, a Hong Kong-based partner at Eversheds Sutherland, as saying. "Any attempt to apply the concept in a cowboy fashion, against the interests of the offshore bondholders, will almost certainly hurt foreign investors' confidence toward debt issued by Chinese entities." While Huachen itself has had challenges -- missing a coupon payment on its 2020 dollar bonds in recent days -- the company said in a statement on Nov. 20 that it will make that payment by Dec. 18, within the grace period, Bloomberg notes. In a developed market such as the U.S., there's less focus on any parent company when considering the credit profile of a bond issuer, and any move by the parent that impinges on its unit could end up in court, market participants said, Bloomberg relays. As the Wintime case affects dollar bonds, it also raises questions about creditor rights in the $804 billion offshore Chinese corporate-note market. "The case highlights that even though the dollar bonds are issued directly by Huachen, as a subsidiary to Wintime it can still be impacted by what has gone wrong at the parent level," Bloomberg Gary Zhou, fixed-income director at China Securities International, as saying. He reckons that investors should be more cautious towards those issues and rethink the way they look at certain Chinese credits. Details on Wintime's debt are: * It is delinquent on CNY15 billion of local bonds, making it China's biggest defaulter this year after oil trader CFEC Shanghai International Group Ltd., according to data compiled by Bloomberg. * The company has proposed repackaging its debt into a rolling three-year maturity extension structure, where it pays 10 to 15 percent of the principle back every three years, with coupons set at the central bank's benchmark lending rate. * It also proposed applying CNY20 billion of the CNY70 billion in obligations toward a debt-to-equity swap. Bloomberg says grouping a parent's debt with that of its units' in a restructuring is known as substantive consolidation, a concept that wasn't covered in China's 2007 Enterprise Bankruptcy Law. While it wasn't unusual in the past, China's top court, the Supreme People's Court, said earlier this year that such a move should only be done in exceptional circumstances with strict conditions -- such as when the legal identification of the affiliate is highly mingled with the parent, or the differentiation of assets is excessively costly, Bloomberg states. That makes Wintime a test case for market observers, at a time when stress is rising, says Bloomberg. Total local note delinquencies hit a record of CNY83.4 billion so far this year, according to Bloomberg-compiled data. Average yield on junk-rated dollar bonds from China almost doubled this year to 11.6 percent, according to ICE BofAML indexes. "This incident highlights investors need to be more aware of inter-company relationships such as who is controlling the issuer," Bloomberg quotes Ek Pon Tay, portfolio manager for emerging market fixed income at BNP Paribas Asset Management, as saying. "That needs to be the factor that investors give a bigger weight to going forward. This scenario is a reminder for that." About Wintime Energy China-based Wintime Energy Co., Ltd., engages in the power, mining, petrochemical, logistics and investment, and other businesses in China. The company generates power; mines and produces coking coal; and processes shale gas. It has an electric power installed capacity of 10.94 million kilowatts; a total of 14 producing mines; and shale gas exploration rights. The company is also involved in the new energy business; and distribution of petrochemicals. In addition, it invests in strategic emerging industry projects, financial sector, coking coal and thermal coal projects, and power and new energy projects. As reported in the Troubled Company Reporter-Asia Pacific on Oct. 24, 2018, Reuters said Wintime Energy Co. had defaulted on principal and interest payments on a puttable medium-term note after investors exercised their options to sell bonds back to the company. The payments, worth a total of CNY1.49 billion ($214.74 million), were due Oct. 22, the company said in a statement on the website of the Shanghai Clearing House, Reuters relates. In a separate statement, the company said the default had triggered cross-protection clauses in six of its other outstanding debt instruments. YANAN BICON: S&P Lowers ICR to 'CCC' on Refinancing Risk -------------------------------------------------------- S&P Global Ratings lowered its issuer credit rating on YanAn Bicon Pharmaceutical Listed Co. (formerly Jiangsu Bicon Pharmaceutical Listed Co.) to 'CCC' from 'B'. S&P placed the ratings on CreditWatch with developing implications. S&P said, "We lowered the issuer credit rating on YanAn Bicon due to company's significant near term maturities and insufficient cash on hand to repay the obligations. These near term maturities include Chinese renminbi (RMB) 1.8 billion of bonds with put options that will likely be exercised on Nov. 30 and Dec. 7 this year. "The CreditWatch placement with developing implications reflects the potential for us to lower the rating if a successful refinancing appears unlikely, or raise the rating if the company sufficiently addresses the near-term maturity." YanAn Bicon is in the process of pursuing multiple financing options to address the RMB1.8 billion of bonds that can be put in the next 30 days. S&P expects such financing to include bank loans and private bond placements, based on the company's track record. However, there is no certainty as to whether any of these financing plans will bear fruit and refinancing risk continues to increase as the maturities fast approach. Additional support to the company's financing efforts could come from a recent cooperation framework with the Yan'an city government and a subsequent investment by the government's investment vehicle in the company. The two sides have agreed to jointly research new drug products, invest in new projects, and develop new pharmaceutical markets both domestically and internationally. In return, the company has agreed to register its headquarters in Yan'an, becoming the first publicly-listed company in the city, and jointly establish and invest in the "Bicon Smart Industrial Town." S&P's base case no longer assumes the sale of YanAn Bicon's non- core businesses. The sale of these businesses, including new materials, alternative energy, and chemicals has been delayed due to the buyer's inability to obtain shareholder approval for the transaction. However, the transaction has not been terminated and could still occur within the coming months, which S&P believes to be marginally positive because the buyer is expected to only acquire a 51% interest instead of the entire business. S&P said, "We reflect YanAn Bicon's upcoming maturities by assessing the company's capital structure as negative. We also assess the company's management and governance score as weak, reflecting the management's inadequate financial management resulting in the company's material liquidity risk. The CreditWatch with developing implications reflects the uncertainty associated with YanAn Bicon's ability to refinance the RMB1.8 billion puttable bonds that will likely be put back to the company at the end of November and early December 2018. We expect to resolve the CreditWatch placement following the conclusion of the debt-refinancing process, likely within the next 90 days. "We could lower the rating by one or more notches, if we do not believe the company will complete its refinancing plans prior to put dates on the bonds. "On the other hand, we could raise the rating if the company successfully executes its refinancing plans and if the refinancing enhances the company's capital structure and liquidity. "We expect to resolve the CreditWatch placement following the conclusion of the debt-refinancing process, likely within the next 90 days." ================ H O N G K O N G ================ NOBLE GROUP: To Stick with Restructuring Deadline Despite Probe --------------------------------------------------------------- The Business Times reports that Noble Group will continue to work towards implementing its proposed restructuring within previously disclosed timelines despite the launch of investigations by Singapore law enforcement and regulators, the commodities trading company announced on Nov. 21. According to BT, the statement came after the Singapore Police Force's Commercial Affairs Department, the Monetary Authority of Singapore (MAS) and the Accounting and Corporate Regulatory Authority (ACRA) said on Nov. 21 that they were investigating suspected false and misleading statements and breaches of disclosure requirements by Noble, and potential non-compliance with accounting standards by Noble's wholly owned Noble Resources International unit. That joint investigation came following a review of Noble Resources' financial statements for the years 2012 through 2016 by ACRA, BT says. On Nov. 21, Noble said that the investigators have sought documents and information relating to contracts and accounts for the years 2012 through 2017. Noble and its subsidiary intend to fully cooperate with the investigations, Noble said, BT relays. About Noble Group Noble Group has been in operation since 1986 and, today, is one of the world's largest commodity traders by volume. Noble maintains its corporate office in London, England, and is listed on the Singapore Exchange Limited (SGX: CGP). Though its registered office is located in Bermuda, Noble engages in no activities or operations there. Noble Group Limited functions as the ultimate holding company of Noble Group, holding shares in a number of intermediate holding companies incorporated in several jurisdictions including Bermuda, the British Virgin Islands, Singapore, and Hong Kong, which in turn own shares in additional holding companies and operating companies in various jurisdictions. In March 2018, Noble reached terms of a restructuring plan that will hand over a bulk or 70 per cent of the equity to senior creditors, 10 per cent to management and the rest to existing shareholders. In August, 99.96 percent of shareholders approved the plan, and as of October 2018, 88% of the holders of existing senior debt instruments have acceded to the RSA. To effectuate the restructuring, the restructuring support agreement contemplates two inter-conditional schemes of arrangement under section 99 of the Companies Act 1981 of Bermuda (the "Bermudan Scheme") and Part 26 of the Companies Act 2006 of England and Wales. The English Scheme will be the primary proceeding to restructure Noble's funded debt. On Sept. 21, 2018, Noble notified its creditors of its intention to propose the English Scheme. The English Court will conduct the English Scheme Sanction Hearing on Nov. 12, 2018 to consider approving the English Scheme. Noble has obtained an order from the Supreme Court of Bermuda, pursuant to section 99 of the Companies Act 1981 of Bermuda granting leave to convene meetings of the Scheme Creditors of Bermuda to consider and approve a Bermudan scheme of arrangement for Noble. Noble Group on Oct. 17, 2018, filed a Chapter 15 bankruptcy petition in New York to seek U.S. recognition of its restructuring (Bankr S.D.N.Y. Case No. 18-13133). Kirkland & Ellis LLP serves as U.S. counsel. PRIME SOURCE: Allowed to Reject Commercial Lease with Peacock ------------------------------------------------------------- Judge Mindy A. Mora of the U.S. Bankruptcy Court for the Southern District of Florida authorized Prime Source Accessories, Inc. (i) to reject the unexpired commercial lease with Peacock Development/Treasure Coast L.L.C., doing business as North Stuart Centre, and (ii) to sell the furniture, fixtures and equipment located at the leased premises, or, in the alternative, abandon the FF&E to Peacock, nunc pro tunc to Oct. 31, 2018. The unexpired commercial lease with Peacock is deemed rejected nunc pro tunc to Oct. 31, 2018. The Debtor is authorized to sell the furniture, fixtures and equipment located in the office premises without further order of the Court and deposit funds from any sale in the DIP bank account. To the extent the Debtor is unable to sell any the furniture, fixtures and equipment located in the office premises, the Debtor is authorized to abandon the FF&E to Peacock as having de minimus value. Certain FF&E has been previously sold. The Debtor received net proceeds of $1,749, which was deposited in the DIP account. Exhibit A is a detailed listing of the FF&E that has been sold with the sales price received. The remaining items that have not been sold will be abandoned to the landlord. Nothing in the Order will be construed that the Debtor is rejecting Storage Unit E4, which is leased by the Debtor under a separate lease agreement. Any Claim arising from the rejection of the Contracts and/or Leases set forth in the Motion and referenced will be filed by the claims bar date set by the Court, specifically, Dec. 31, 2018. A copy of the Exhibit A attached to the Order is available for free at http://bankrupt.com/misc/Prime_Source_71_Order.pdf About Prime Source Accessories Prime Source Accessories, Inc., with headquarters in south Florida and full service sourcing offices in Hong Kong & Shenzhen, China, is a design and manufacturing and sourcing firm targeting the teen, collegiate and adult segments of the retail industry. Prime Source is a privately held company founded in 1997. Prime Source Accessories filed a voluntary petition under Chapter 11 of the U.S. Bankruptcy Code (Bankr. S.D. Fla. Case No. 18- 20158) on Aug. 21, 2018. In the petition signed by Jamie Chauss, president, the Debtor disclosed $394,163 in assets and $1,011,261 in liabilities. The case is assigned to the Hon. Erik P. Kimball. Craig I. Kelley, Esq., at Kelley & Fulton, PL, is the Debtor's counsel. ========= I N D I A ========= A. RAMANATHAN: CRISIL Reaffirms B+ Rating on INR13cr Cash Loan -------------------------------------------------------------- CRISIL has reaffirmed its ratings on the bank facilities of A. Ramanathan & Company (ARC) at 'CRISIL B+/Stable/CRISIL A4'. The ratings reflect the firm's small scale, working capital intensive operations and weak financial risk profile. These weaknesses are partially offset by the extensive experience of the partners in the construction business. Amount Facilities (INR Crore) Ratings ---------- ----------- ------- Bank Guarantee 2 CRISIL A4 (Reaffirmed) Cash Credit 13 CRISIL B+/Stable (Reaffirmed) Key Rating Drivers & Detailed Description Weaknesses * Small scale and working capital-intensive operations: ARC is a small player generating revenue of around INR18 crore in fiscal 2018 and the construction business is inherently working capital intensive. However, with improved order book position (Rs 40 crore outstanding as of October 2018), the revenue is should increase over the medium term. * Weak financial risk profile: The financial risk profile has deteriorated post addition of term debt and increased bank borrowings. Furthermore, due to capital withdrawal by partners, the networth has come down leading to increase in gearing to 2.75 times as on March 31, 2018 from 1.18 times a year earlier. Debt protection metrics also deteriorated with interest coverage of about 2 times in fiscal 2018 against 2.4 times in fiscal 2017. Strength: * Partners' extensive experience and established track record of operations: Established in 1955, ARC has a long track record of operations and the partners' extensive experience in the construction industry has further enabled the firm to secure several tenders in Tamil Nadu and expand its operations. Outlook: Stable CRISIL believes ARC will maintain a stable business risk profile backed by its partners' extensive experience. The outlook may be revised to 'Positive' if expanded geographical reach and diversification in customer base strengthen the business risk profile, and if revenue and profitability increase significantly, while improving capital structure. Conversely, the outlook may be revised to 'Negative' if significant decline in revenue and profitability, or if considerable delays in realisation of receivables, or larger-than-expected, debt-funded capital expenditure, weakens the financial risk profile and liquidity. Established in 1955 as a partnership between Mr R Panneerselvam and family, ARC, located in Trichy (Tamil Nadu) and managed by Mr PA Paranthaman, undertakes civil contracts to build roads, bridges and canals. ABZ AGRO: CRISIL Withdraws B+ Rating on INR30cr Loans ----------------------------------------------------- CRISIL has withdrawn its rating on the long-term bank facility of ABZ Agro Foods Limited (ABZ) following a request from the company. The rating action is in line with CRISIL's policy on withdrawal of bank loan ratings. Amount Facilities (INR Crore) Ratings ---------- ----------- ------- Proposed Fund- Based Bank Limits 5 CRISIL B+/Stable (Withdrawn) Proposed Long Term Bank Loan Facility 25 CRISIL B+/Stable (Withdrawn) ABZ was incorporated in 2008, promoted by Mr. Mohd. Saleem Gulam Rasool Qureshi, Ms. Shaheen Qureshi, and Ms. Atika Mohd. Saleem Qureshi. The company is setting up an integrated abattoir-cum- meat processing plant with a capacity of 1000 head of cattle per day in Kishanganj, Bihar. Operations are expected start from September 2018. AMAR JYOTHI: CRISIL Maintains 'B' Rating in Not Cooperating ----------------------------------------------------------- CRISIL's rating on bank facilities of Amar Jyothi Paper Co. (AJPC) continues to be CRISIL B/Stable/CRISIL A4 Issuer not cooperating'. Amount Facilities (INR Crore) Ratings ---------- ----------- ------- Cash Credit 8 CRISIL B/Stable (ISSUER NOT COOPERATING) Letter of Credit 4 CRISIL A4 (ISSUER NOT Bill Discounting COOPERATING) CRISIL has been consistently following up AJPC for obtaining information through letters and emails dated April 30, 2018 and October 30, 2018 among others, apart from telephonic communication. However, the issuer has remained non cooperative. 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 AJPC, which restricts CRISIL's ability to take a forward looking view on the entity's credit quality. CRISIL believes information available on AJPC, is consistent with 'Scenario 1' outlined in the 'Framework for Assessing Consistency of Information with 'CRISIL BB' category or lower'. Based on the last available information, the rating on bank facilities of AJPC, continues to be CRISIL B/Stable/CRISIL A4 Issuer not cooperating'. AJPC, established in 1990, is a Bengaluru-based proprietorship firm of Mr. Kantilal Jain; the firm trades in writing and printing paper. AQUA WORLD: CRISIL Reaffirms B+ Rating on INR9cr Packing Credit --------------------------------------------------------------- CRISIL has reaffirmed its 'CRISIL B+/Stable' rating on the long- term bank facility of Aqua World Exports Private Limited (AWEPL). Amount Facilities (INR Crore) Ratings ---------- ----------- ------- Export Packing 9 CRISIL B+/Stable (Reaffirmed) Credit The rating continues to reflect AWEPL's exposure to customer concentration risks and a below-average financial risk profile. These weaknesses are partially offset by a stable business risk profile and prudent working capital management. Key Rating Drivers & Detailed Description Weaknesses * Exposure to customer concentration risks: AWEPL derives about 40% revenue from a single client, Lulu, rendering the business vulnerable to customer concentration. Any vendor rationalisation effort by the client could weaken the business. * Below-average financial risk profile: Financial risk profile may continue to be below average due to a leveraged capital structure, resulting from high reliance on creditors and large working capital debt. Total outside liabilities to tangible networth ratio was high at 13 times as on March 31, 2018. Strengths * Stable business risk profile: Operating margin remained stable at 1.1-1.7 percent for the four fiscals through 2018 due to nil inventory as AWEPL ships the catch on the same day. * Prudent working capital management: Working capital requirement will remain comfortable over the medium term. Inventory is nil and receivables moderate at 15-30 days due to established relationship with customers. Outlook: Stable CRISIL believes AWEPL will continue to benefit the experience of the promoters' experience. The outlook may be revised to 'Positive' if substantial and sustainable increase in revenue and profitability strengthens financial risk profile. Conversely, the outlook may be revised to 'Negative' if stretch in working capital cycle or any large, debt-funded capital expenditure weakens financial risk profile and liquidity. AWEPL, established in 2003 at Chennai exports marine products like shrimp, squid, octopus, groupers and various varieties of fish. The company currently has a capacity to process 40 tonne of marine products per day. Mr.S. Hari dass and Ms Anupama Hari dass are the promoters. AVIRAT COTTON: CARE Reaffirms B+ Rating on INR17.30cr LT Loan ------------------------------------------------------------- CARE Ratings reaffirmed ratings on certain bank facilities of Avirat Cotton Industries Private Limited (ACIPL), as: Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long-Term Bank 17.30 CARE B+; Stable (Rating Facilities Reaffirmed and outlook revised from Positive to Stable) Detailed Rationale & Key Rating Drivers The rating assigned to the bank facilities of ACIPL continues to remain constrained on account of moderate scale of operations, thin profit margins, moderate capital structure, weak debt coverage indicators and moderate liquidity position. The rating also continue to remain constrained owing to the susceptibility of operating margins to cotton price fluctuations, regulatory changes governing cotton industry, its presence in the lowest segment of textile value chain and highly fragmented cotton ginning industry. The rating, however, continues to derive strength from the promoters' experience of more than a decade in cotton ginning business and its proximity to cotton-producing area of Gujarat. ACIPL's ability to increase its scale of operations and improve its profitability by managing the volatility associated with prices in cotton and improvement in capital structure and debt coverage indicators coupled with efficient working capital management remains the key rating sensitivities. Outlook: Stable The outlook is revised from Positive to Stable owing to lower than envisaged performance during FY18; marked by decline in scale of operations and elongation of operating cycle. Detailed description of the key rating drivers Key Rating Weaknesses Moderate scale of operations and thin profit margins: The scale of operations of ACIPL as marked by total operating income (TOI) declined over previous year and stood moderate at INR77.81 crore during FY18 as against INR88.43 crore during FY17. During FY18, AICPL reported around 80% of its sales from cotton bales and rest 20% through other by-products like cotton seeds, cotton seed cake and cotton wash oil. The profit margin of ACIPL remained thin marked by PBILDT margin of 1.86% and PAT margin of 0.07% during FY18 on account of limited value addition and presence in the highly competitive segment of the cotton industry. Moderate capital structure, weak debt coverage indicators and moderate liquidity position: The capital structure stood moderate marked by overall gearing ratio of 1.35 times as on March 31, 2018 on account of moderate net worth base (1.74 times as on March 31, 2017). As a result of its thin profitability, the debt coverage indicators remained weak marked by high ratio of total debt to GCA of 28.48 times during FY18 (29.35 times during FY17). The liquidity position stood moderate marked by current ratio of 1.44 times as on March 31, 2018. Also, the operating cycle elongated by 5 days and stood at 71 days during FY18 as compared to 66 days during FY17 owing to increase in collection period. Susceptibility of operating margins to cotton price fluctuations, regulatory changes governing cotton industry: The profitability of ACIPL is exposed to fluctuations in raw material prices, which being agricultural commodity, its prices are volatile in nature and linked to production in the domestic market. Further, the supply of key raw materials is primarily dependent upon monsoon during a particular year as well as overall climatic conditions. Hence any adverse movement in cotton prices would impact profitability of the company. Presence in the highly competitive and fragmented cotton ginning industry: ACIPL operates in an industry characterized by high fragmentation and intense competition on account of presence of a large number of small and medium-scale units due to minimal technological and financial investment requirement. Furthermore, due to limited value addition, players present in this segment operate at a very low bargaining power against its customers as well as suppliers. Key rating strengths Experienced promoters: ACIPL is promoted and managed by Mr. Bhupendrabhai Tala and Mr. Bharatbhai Vataliya, who hold more than a decade of experience in cotton ginning industry. Proximity to the cotton-producing region of Gujarat: ACIPL's plant is located in (Rajkot) Gujarat region which is the largest producer of raw cotton in India. ACIPL's presence in cotton- producing region results in benefit derived from lower logistics expenditure (both on transportation and storage), easy availability and procurement of raw materials at effective price and consistent demand for finished goods resulting in sustainable revenue visibility. Rajkot (Gujarat) based ACIPL was incorporated in 2005 as a partnership firm under the name M/s. Avirat Cotton Industries (ACI) and then converted into a private limited company in 2008. ACIPL is involved in cotton ginning & pressing, cotton seed crushing and trading in agro commodities. ACIPL operates from its sole manufacturing unit located at Gondal (Gujarat) with an installed processing capacity to manufacture 8,250 metric tonne per annum (MTPA) of cotton bales, 1,460 MTPA of oil extraction and 10,950 MTPA of de-oiled cake as on March 31, 2018. B.G. TRANSPORT: Ind-Ra Maintains BB- LT Rating in Non-Cooperating ----------------------------------------------------------------- India Ratings and Research (Ind-Ra) has maintained B.G. Transport Company's Long-Term Issuer Rating in the non-cooperating category. The issuer did not participate in the rating exercise despite continuous requests and follow-ups by the agency. Therefore, investors and other users are advised to take appropriate caution while using these ratings. The rating will continue to appear as 'IND BB- (ISSUER NOT COOPERATING)' on the agency's website. The instrument-wise rating actions are: -- INR59.87 mil. Term loan maintained in non-cooperating category with IND BB- (ISSUER NOT COOPERATING) rating; -- INR13.5 mil. Fund-based working capital limits maintained in non-cooperating category with IND BB- (ISSUER NOT COOPERATING) rating; and -- INR1 mil. Non-fund-based working capital limits maintained in non-cooperating category with IND A4+ (ISSUER NOT COOPERATING) rating. Note: ISSUER NOT COOPERATING: The ratings were last reviewed on October 7, 2016. Ind-Ra is unable to provide an update, as the agency does not have adequate information to review the ratings. COMPANY PROFILE B.G. Transport, incorporated in 2011 as a partnership firm by the Gujral Group, is primarily involved in the transportation business. BAJAJ PROCESSPACK: CARE Hikes Rating on INR4cr LT Loan to B+ ------------------------------------------------------------ CARE Ratings revised the ratings on certain bank facilities of Bajaj Processpack Limited (BPL), as: Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long-term Bank 4 CARE B+; Stable Revised from Facilities CARE B Short-term Bank Facilities 2 CARE A4 Reaffirmed Detailed Rationale and key rating drivers The revision in the long-term rating assigned to the bank facilities of BPL factors in improvement in net profitability margin and capital structure along with improvement in operating cycle. The ratings further continue to derive strength from the experienced management. The ratings, however, continue to remain constrained by small and fluctuating scale of operations with low net worth base and its presence in the competitive nature of industry. Going forward; BPL's ability to scale up its scale of operations while improving its profitability margins and capital structure shall be the key rating sensitivities. Detailed description of the key rating drivers Key Rating Strengths Experienced management: The company is currently being managed by Mr. Girish Bajaj and Mr. Sushil Kumar. Both of them are engineering graduates and have an experience of around half a decade in manufacturing of food processing and packaging machines through his association with BPL. Improvement in net profitability margin, capital structure and operating cycle: PBILDT margin which stood at 6.20% in FY18 as against 7.71% in FY17 on account of fluctuation in raw material price and increment in employee and other manufacturing cost .PAT margin stood at 0.84% in FY18 as against losses in FY17. Further, gross cash accruals stood at INR0.52 crore in FY18 as against cash losses in FY17, the improvement was on account of higher sales and lower finance cost. The capital structure of the company marked by overall gearing improved at 3.44x on March 31, 2018 as against 5.11x on March 31, 2017, on account of higher net worth base owing to accretion of profit and infusion of fund in form of equity and lower utilization of working capital limit as on March 31, 2018. The average working capital limits of the company remained fully utilized for 12 months ending September, 2018. Further, owing to improvement in profitability and lower debt level; the debt coverage indicators of the company as marked by interest coverage and total debt to GCA stood at 1.71x and 9.90x for FY18. The operating cycle of the company improved and stood at 86 days in FY18 against 164 days in FY17. The improvement was mainly on account of better management of inventory levels and faster realization of the debtor. Key Rating Weakness Small scale of operations with low net worth base: The scale of operations remained small marked by total operating income (TOI) of INR20.29 crore during FY18 (FY refers April 1st to March 31). Further, the scale of operations stood fluctuating for the past three (FY16-FY18). TOI has registered a decline in FY16 and registers a growth in FY17. The total operating income registered growth in FY17 over previous year owing to increase in machines sold Furthermore, the net worth continues to remain small at INR1.49 crore as on March 31, 2018. The small scale limits the company's financial flexibility in times of stress and deprives it from scale benefits. Further, the company has achieved TOI of about Rs.9 crore for 6MFY19 (refers to period from April 1 to September 30). Inventory holding risk coupled with presence in highly competitive industry: The company is exposed to raw material price fluctuation risk as the company needs to maintain adequate inventory for smooth execution of orders. Any volatility in the prices of steel can lead in adverse performance of the company. Also the company operates in a competitive industry wherein there is presence of a large number of players in the unorganized and organized sectors. Hence, the players in the industry do not have any pricing power and are exposed to competition induced pressures on profitability. New Delhi based, Bajaj Processpack Limited (BPL) was incorporated in July 2010 and started its commercial operations in December 2011. The company is currently being managed by Mr Girish Bajaj and Mr Sushil Kumar. BPL is engaged in manufacturing of food processing and packaging machines. BEE JAY: Ind-Ra Maintains BB- LT Issuer Rating in Non-Cooperating ----------------------------------------------------------------- India Ratings and Research (Ind-Ra) has maintained Bee Jay Industrial Corporation's Long-Term Issuer Rating in the non- cooperating category. The issuer did not participate in the rating exercise despite continuous requests and follow-ups by the agency. Therefore, investors and other users are advised to take appropriate caution while using these ratings. The rating will continue to appear as 'IND BB- (ISSUER NOT COOPERATING)' on the agency's website. The instrument-wise rating action is: -- INR200 mil. Fund-based working capital limit maintained in non-cooperating category with IND BB- (ISSUER NOT COOPERATING) / IND A4+ (ISSUER NOT COOPERATING) rating. Note: ISSUER NOT COOPERATING: The ratings were last reviewed on November 10, 2016. Ind-Ra is unable to provide an update, as the agency does not have adequate information to review the ratings. COMPANY PROFILE Established as a partnership concern in 1996 by Mr. Devender Garg and Mrs. Anju Garg, Bee Jay Industrial Corporation is engaged in the trading of iron and steel products. BHUPINDER SINGH: Ind-Ra Maintains BB- Rating in Non-Cooperating --------------------------------------------------------------- India Ratings and Research (Ind-Ra) has maintained Bhupinder Singh's Long-Term Issuer Rating in the non-cooperating category. The issuer did not participate in the rating exercise despite continuous requests and follow-ups by the agency. Therefore, investors and other users are advised to take appropriate caution while using these ratings. The rating will continue to appear as 'IND BB- (ISSUER NOT COOPERATING)' on the agency's website. The instrument-wise rating actions are: -- INR64 mil. Fund-based limit maintained in non-cooperating category with IND BB- (ISSUER NOT COOPERATING) rating; -- INR2.14 mil. Non-fund-based limits maintained in non- cooperating category with IND A4+ (ISSUER NOT COOPERATING) rating; and -- INR44.31 mil. Term loans maintained in non-cooperating category with IND BB- (ISSUER NOT COOPERATING) rating. Note: ISSUER NOT COOPERATING: The ratings were last reviewed on October 3, 2016. Ind-Ra is unable to provide an update, as the agency does not have adequate information to review the ratings. COMPANY PROFILE Incorporated in 2011, Bhupinder Singh is a partnership firm that provides LPG transportation services to major oil companies such as Bharat Petroleum Corporation Limited, Indian Oil Corporation Limited ('IND AAA'/Stable) and Hindustan Petroleum Corporation Limited ('IND AAA'/Stable) in the eastern region of India. BLUE DUCK: Ind-Ra Maintains 'BB-' LT Rating in Non-Cooperating -------------------------------------------------------------- India Ratings and Research (Ind-Ra) has maintained Blue Duck Textiles Private Limited's Long-Term Issuer Rating in the non- cooperating category. The issuer did not participate in the rating exercise despite continuous requests and follow-ups by the agency. Therefore, investors and other users are advised to take appropriate caution while using these ratings. The rating will continue to appear as 'IND BB- (ISSUER NOT COOPERATING)' on the agency's website. The instrument-wise rating actions are: -- INR60.00 mil. Fund-based working capital limit maintained in non-cooperating category with IND BB- (ISSUER NOT COOPERATING)/IND A4+ (ISSUER NOT COOPERATING) rating; and -- INR18.36 mil. Term loan maintained in non-cooperating category with IND BB- (ISSUER NOT COOPERATING) rating. Note: ISSUER NOT COOPERATING: The ratings were last reviewed on August 19, 2016. Ind-Ra is unable to provide an update, as the agency does not have adequate information to review the ratings. COMPANY PROFILE Incorporated in 2013, Blue Duck Textiles Private Limited is engaged in the dyeing and printing of fabrics. DHARIYA CONSTRUCTION: CRISIL Withdraws B Rating on INR12cr Loan --------------------------------------------------------------- Due to inadequate information, CRISIL, in line with SEBI guidelines, had migrated the rating of Dhariya Construction Private Limited (DCPL) to 'CRISIL B-/Stable/Issuer not cooperating'. CRISIL has withdrawn its rating on bank facility of DCPL following a request from the company and on receipt of a 'no dues certificate' from the banker. Consequently, CRISIL is migrating the ratings on bank facilities of DCPL from 'CRISIL B- /Stable/Issuer Not Cooperating to 'CRISIL B-/Stable'. The rating action is in line with CRISIL's policy on withdrawal of bank loan ratings. Amount Facilities (INR Crore) Ratings ---------- ----------- ------- Cash Credit 4 CRISIL B-/Stable (Migrated from 'CRISIL B-/Stable ISSUER NOT COOPERATING'; Rating Withdrawn) Working Capital Term Loan 8 CRISIL B-/Stable (Migrated from 'CRISIL B-/Stable ISSUER NOT COOPERATING'; Rating Withdrawn) Set up in 2003 by Mr. Mukund Dhariya, DCPL undertakes civil work contracts involving construction of dams, roads, tunnels, and others for the Kumbhe hydroelectric project in Maharashtra. In March 2005, the company won the bid for construction of the Kumbhe dam, and since then has been awarded several other assignments related to the same project. ENCORP POWERTRANS: CRISIL Withdraws B Rating on INR9cr Loans ------------------------------------------------------------ CRISIL has withdrawn its ratings on the bank facilities of Encorp Powertrans Private Limited (Encorp) on the request of the company and receipt of a no objection certificate from its bank. The rating action is in line with CRISIL's policy on withdrawal of its ratings on bank loans. Amount Facilities (INR Crore) Ratings ---------- ----------- ------- Cash Credit 5 CRISIL B/Stable (ISSUER NOT COOPERATING; Rating Withdrawn) Term Loan 4 CRISIL B/Stable (ISSUER NOT COOPERATING; Rating Withdrawn) CRISIL has been consistently following up with Encorp for obtaining information through letters and emails dated December 31, 2017 and June 29, 2018, among others, apart from telephonic communication. However, the issuer has remained non cooperative. 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 they are arrived at without any management interaction and are 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 ENCORP. This restricts CRISIL's ability to take a forward ENCORP is consistent with 'Scenario 1' outlined in the 'Framework for Assessing Consistency of Information with CRISIL BB rating category or lower. Based on the last available information, the rating on bank facilities of ENCORP continues to be 'CRISIL B/Stable Issuer Not Cooperating'. CRISIL has withdrawn its ratings on the bank facilities of ENCORP on the request of the company and receipt of a no objection certificate from its bank. The rating action is in line with CRISIL's policy on withdrawal of its ratings on bank loans. Encorp was set up in 2010 by Mr. Rahul Nowal and his brother Mr. Vinay Nowal. The company is engaged in fabrication of power transmission towers. It also undertakes galvanisation work for fabricated steel structures. The company's manufacturing facility is at Tarapur (Maharashtra). ESSAR STEEL: GAIL Seeks Rejection of ArcelorMittal's Bid -------------------------------------------------------- BloombergQuint reports that GAIL (India) Ltd. and Gujarat Energy Transmission Corp. have moved the National Company Law Tribunal seeking rejection of ArcelorMittal's INR42,000-crore takeover plan for Essar Steel, saying operational creditors have been left out in the proposal. A committee of Essar Steel lenders last month picked ArcelorMittal's INR42,000-crore proposal to take over the debt- laden company by paying INR41,987 crore out of total dues of INR49,395 crore of financial creditors. Operational creditors, under the plan, are to get just INR214 crore against the outstanding of INR4,976 crore, BloombergQuint discloses. Aggrieved by ArcelorMittal's resolution plan, GAIL and GETCO filed separate interlocutory applications in the Ahmedabad-bench of NCLT. The companies said they have claims of over INR1,800 crore against Essar Steel India, which are not being fully cleared. BloombergQuint relates that GAIL in the Nov. 16 application said it has a claim of INR907.20 crore towards non-offtake of gas that it had signed for under a take or pay agreement. Of this, about INR125 crore has already been admitted in the list of creditors of the company. According to BloombergQuint, GAIL petition sought rejection of the ArcelorMittal proposal stating that the resolution plan was in contravention of Section 30 (2) of Insolvency and Bankruptcy Code and "completely fails to protect the interest of operational creditors". GETCO, which wheeled power for the company, in a separate petition sought a direction to include its entire claim of INR896.52 crore and rejection of the resolution plan in case this is not met, BloombergQuint relays. Last week, as many as 29 operational creditors of Essar Steel had filed petitions in NCLT pleading that the debt settlement proposal made by shareholders of Essar Steel be considered as it would pay off all outstanding of both financial and operational creditors, BloombergQuint recalls. BloombergQuint relates that the 29 operational creditors, which have about INR381 crore in outstanding dues from Essar Steel, wanted ArcelorMittal -- which the lenders have picked to take over the debt-ridden firm -- to pay in full to all operational creditors or allow consideration of the INR54,389 crore proposal of the owners of Essar Steel to be considered. Essar Steel Asia Holding Ltd., the promoter of Essar Steel, has proposed to pay INR54,389 crore to clear all dues of the financial and operational creditor in a last-ditch effort to avert losing their flagship company, according to BloombergQuint. About Essar Steel Incorporated in 1976, Essar Steel India Ltd. is a part of the Essar Group and is having 10 MTPA integrated steel manufacturing facilities at Hazira, Gujarat and iron ore beneficiation and pelletisation facilities in Paradeep, Odisha (12 mtpa) and Vizag, Andhra Pradesh (8 mtpa). The company also owns and operates two iron ore slurry pipelines -- one each in Odisha (Dabuna to Paradip) and Andhra Pradesh (Kirandul-Vizag), which transport the iron ore slurry from the beneficiation plant (located near the iron ore mines in Dabuna and Kirandul) to the pellet plant (located near the Paradip and Vizag ports). A large portion of the iron ore pellets produced are intended for captive consumption by ESIL's steel plant at Hazira for cost optimization. The National Company Law Tribunal (NCLT) - Ahmedabad Bench admitted Essar Steel's insolvency case on Aug. 2, 2017. Satish Kumar Gupta of Alvarez and Marsal India has been appointed as interim resolution professional upon the suggestion of State Bank of India (SBI). Essar Steel owes more than INR45,000 crore to lenders, of which INR31,671 crore had already been declared as non-performing as of March 31, 2016, The Economic Times disclosed. The SBI-led consortium of 22 creditors accounts for 93% of this amount. Essar Steel owes $450.67 million to Standard Chartered Bank (SCB) in debt. FULETRA AGRO: CARE Reaffirms B+ Rating on INR4.01cr LT Loan ----------------------------------------------------------- CARE Ratings reaffirmed ratings on certain bank facilities of Fuletra Agro Food (FAF), as: Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long-term Bank 4.01 CARE B+; Stable Reaffirmed Facilities Long-term/ 5.00 CARE B+; Stable/CARE A4 Short-term Reaffirmed Bank Facilities Detailed Rationale & Key Rating Drivers The ratings assigned to the bank facilities of FAF continue to remain constrained on account of nascent stage of operations and weak financial risk profile during FY18 (Provisional; refers to the period April 1 to March 31). The ratings, further, continue to remain constrained on account of its presence in a highly fragmented and seasonal agro processing industry, constitution as a partnership firm and susceptibility of its margins to raw material price fluctuations & foreign exchange fluctuation risks. The ratings, however, continue to derive strength from the FAF's experienced partners, location advantage and its eligibility to avail fiscal benefits from the government. The ability of FAF to increase its scale of operations and profitability are the key rating sensitivities. Further, improvement in solvency position along with efficient management of working capital borrowings would also remain crucial. Detailed Description of Key Rating Drivers Key Rating Weaknesses Nascent stage of operations and weak financial risk profile: FAF successfully completed its capex with a total cost of INR7.02 crore funded through debt equity mix of 1.93:1 times; while it commenced its commercial operations from October 2017 onwards. The total operating income (TOI) of FAF stood modest at INR21.67 crore for its six months of operations during FY18 (Prov.). Furthermore, PBILDT margin stood low at 4.57%, while it registered net losses to the tune of INR0.40 crore during FY18 (Prov.). As on March 31, 2018 (Prov.) FAF's capital structure stood leveraged marked by overall gearing ratio of 4.18 times, while debt coverage indicators stood weak as marked by total debt to GCA that stood weak owing to higher debt level coupled with low cash accruals and moderate interest coverage ratio at 1.37 times during FY18 (Prov.). The current ratio of FAF stood modest at 1.02 times as on March 31, 2018, while average utilization of working capital limits remained high at 95% during the past 12 months period ended September, 2018. Presence in highly fragmented industry and constitution as partnership firm: High proportion of small scale units operating in the peanut value chain has resulted in the fragmented nature of the industry as well as intense competition within the players. Players present in segment operate at very low bargaining power against its customers. In addition to this; the firm faces inherent risk of withdrawal of capital and limited financial flexibility owing to its partnership nature of its constitution. Susceptibility of profit margins to raw material price fluctuations and foreign exchange rates along with seasonal nature of business: Prices of raw material i.e. peanut are volatile in nature and depend upon various factors. Further, peanut is a seasonal crop as is available mainly from late October, which results into a higher inventory holding period for the business. Thus, aggregate effect of both the above factors results in exposure of food processors to price volatility risk. Furthermore, FAF is also exposed to foreign exchange rate fluctuations risk as it is engaged in exports. Key Rating Strengths Experienced partners: FAF was established by three partners namely Mr. Dinesh Fuletra, Mr. Jignesh Dadhania and Mr. Atman Bhesdadia having vast industrial experience. Mr. Dinesh Fuletra and Mr. Jignesh Dadhania look after overall operations of the firm and Mr. Atman Bhesdadia looks after all export procedures of the firm. Location Advantage: FAF is located in peanut growing belt of Gujarat having large network of peanut producers, which benefits FAF in terms of transportation and connectivity. FAF's presence in peanut producing region results in benefit in terms of easy availability of raw materials and customer base as well. Fiscal benefits from the government: Government of Gujarat (GOG) is providing certain benefits for encouraging small scale business via Gujarat Agro Industries Corporation Limited. FAF is eligible for interest subsidy which is expected to benefit the firm in the nearmedium term. Rajkot-based (Gujarat) FAF; a partnership firm was formed in October, 2016 by Mr. Dinesh Fuletra, Mr. Jignesh Dadhania and Mr. Atman Bhesdadia. FAF is into processing of agro commodities like peanuts, pulses, spices, dry fruits etc. The manufacturing unit of FAF is located at Morbi, Gujarat with installed capacity of processing 10,500 Metric Tonne (MT) of agro commodities per annum as on March 31, 2018. The firm caters to foreign market mainly to European, African, Gulf countries, Russia and Ukraine. GAYATRI VIDYA: CARE Hikes Rating on INR76cr LT Loan to BB- ---------------------------------------------------------- CARE Ratings revised the ratings on certain bank facilities of Gayatri Vidya Parishad (GVP), as: Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term Bank 76.00 CARE BB-; Stable Revised Facilities from CARE D Long Term/ 9.50 CARE BB-; Stable/CARE A4 Short Term Assigned Bank Facilities Detailed Rationale & Key Rating Drivers The revision in rating assigned to the bank facilities of GVP takes into account regularization of dues, debt servicing without delay since June 30, 2018, improved financial performance during 5MFY19 and realization of fee reimbursement from Government of Andhra Pradesh. The rating continues to be tempered by Inherent cash flow mismatches associated with educational institutions resulting in delays in debt servicing and high working capital utilisation, decline in profitability margins during FY18 (period from April 1 to March 31), delay in receipt of license to commence 3rd batch of MBBS course, limited outreach on account of geographical concentration with respect to operations being limited to the city of Visakhapatnam, the risks involved in the highly regulated educational sector with limited track record of the group in the medical stream and competition from other institutions offering similar courses in the engineering and medical segment in Andhra Pradesh and neighboring states. The rating however derives strength from the long operational track record of GVP with an established board of governing members, diversified revenue stream, satisfactory enrolment ratio, comfortable capital structure and Interest coverage ratios and stable industry outlook. Going forward, the ability of GVP to receive license from government for commencing 3rd batch of MBBS course and thereof in successive years, increase in scale of operations and profitability and timely receipt of fee reimbursement from government of Andhra Pradesh are considered key rating sensitivities. Detailed description of the key rating drivers Key Rating Weaknesses Inherent cash flow mismatches associated with educational institutions resulting in delays in debt servicing and high working capital utilisation: Delay in receipt of fee reimbursement from government of Andhra Pradesh resulting in higher utilization of working capital funds coupled with utilization of surplus cash towards the capex requirement for commencement of 3rd batch of MBBS course of GVP HMT resulted in cash flow mismatch during Q4FY18. Delay in receipt of license for 3rd Batch of MBBS course: In spite of complying the requirements in Q1FY19, MCI cancelled the application to commence 3rd batch of MBBS course in October 2018. GVP approached central government to resolve the issue but central government declined their request. Subsequently, GVP has filed a case in Hon'ble High Court of Andhra Pradesh and got a relief from the court directing MCI to reconsider GVP'S application. Meanwhile, Government of India under National Medical Commission Act, passed an ordinance on September 26, 2018 abolishing MCI and placed board of governors in its place immediately to carry out the activities. Debt Funded Capex: The total estimated balance capex for completing the medical college is about INR43 core, the society has incurred about INR17.25 crore as on Sep 2018 through internal accruals. Tie-up of debt funds are critical for completion of the balance works and any delay may force the society to postpone the capex program. Decline in profitability margins during the period FY18: During FY18, the society's SBID margin declined marginally by 17 bps to 32.03% vis-a-vis 32.30% in FY17 on account of increase in employee expenses at the back of recruitment of additional faculty. However the surplus margins declined significantly by 254 bps in FY18 to 12.55% vis-a-vis 15.09% in FY17 on account of increased capital charges due to delay in servicing. Limited outreach and competition from other institutions: The entire operations of GVP are concentrated in the city of Visakhapatnam and hence, the entire revenue of the society is dependent upon the business/ education potential from the city. Further, increased number of educational institutions in the state/country has resulted in severe competition. Risks involved in the highly regulated educational sector: Despite the increasing trend of privatization of education sector in India, the sector continues to operate under stringent regulatory purview. The operating flexibility of the education sector are limited, as regulations governs almost all aspects of operations, including fee structure, number of seats, changes in curriculum and infrastructure requirements. Key Rating Strengths Regularisation of Delays: The Lenders have confirmed that society has regularized its debt servicing from June 2018 on the back of June quarter increased academic receipts. Revision in engineering fee from INR70,000 per year to INR100,000 per year and increase in medical tuition fee by 5% has improved GVP cashflows. Increase in TOI during FY18: Total Operating Income (TOI) of the society has increased by 9% to INR124.83 crore vis-a-vis INR114.64 crore in FY17, Increase in income is mainly on account of high enrollment ratio owing to good placement track. Improved financial performance during 5MFY19 and receipt of fee reimbursement from Government of Andhra Pradesh: During 5MFY19 GVP achieved TOI of INR82.61 crore with SBID margin of 43.97% and surplus margins of 37.12%. From April 1, to September 19, 2018 the society has received fee reimbursement of INR7.55 crore from Govt. of Andhra Pradesh Welfare Department. Track record of college and experienced governing body: GVP has a long operational track record of over 25 years in the field of running educational institutions. The president of GVP is a Mechanical Engineer and a Philanthropist and serves as a Director of Sri Rama Corporation; Secretary of Institute of Development & Planning Studies. Diversified revenue stream with consistent growth and satisfactory enrolment ratio: GVP offers academic courses at Under-Graduate and Post-graduate levels in various fields. Out of which engineering courses contribute a significant portion the total revenue with contribution of 59% during FY18 (66.45% in FY17). Comfortable capital structure and interest coverage ratios: Overall gearing of the society improved from 0.61x as on March 31, 2017 to 0.52x as on March 31, 2018 on account of repayment of term loan installments. SBID interest coverage ratio deteriorated from 4.09x in FY18 to 2.94x in FY18 on account of high interest charges. Satisfactory enrollment rations despite presence in the highly competitive education sector: Despite being present in the highly competitive education sector, the enrollment ratios of GVP are at satisfactory levels of 97% for FY18. Stable Industry Outlook: The Indian Education sector is amongst the largest in the world, with an extensive network of more than 1.4 million schools (with over 200 million students enrolled) and more than 850 universities and 40,000 higher education institutes. The market size of the Indian higher education segment stood at approximately INR2,230 billion in FY17 and is expected to grow at a CAGR of over 11% over the next three years to reach INR3,100 billion; driven by increasing no of enrolments, large no. of courses offered and the higher fees (especially in case of the private institutes). Gayatri Vidya Parishad (GVP) is a registered, charitable, educational society, established by a group of educationists in 1988, has 12 operational institutions in Visakhapatnam, Andhra Pradesh. GVP commenced its operations in 1989 with the establishment of GVP College for Degree and PG courses (GVPCD). Subsequently, in 1996 GVP College of Engineering (GVPCE) was established and was followed by various institutes such as GVP College of Engineering for Women (GVPCEW), GVP Technical School of Engineering (GVPTSE), GVP Institute of Healthcare and Medical Technology (GVP HMT) etc. GVP proposed to establish Gayatri Vidya Parishad Hospital (GVPH) having 300 bed and GVP Institute of Healthcare and Medical Technology (GVP HMT) in 3 phases with an estimated total capex of INR192.86 crore. The funding for the same was envisaged by way of term loan from lenders of about INR132 Crore and balance from internal accruals. With the implementation of Phase 1 and 2, GVP commenced operations of GVPH during FY2012 and commenced operations of GVP HMT from October 2016 with 1st batch of 150 students and 2nd batch of 150 students from October 2017. GVP also extended its expertise in the field of Higher Education by assisting the Sathya Institute of Technology and Management (SITAM) run by Sri Bothsa Guru Naidu Memorial Educational Society, Vizianagaram for its development. GAZEBO INDUSTRIES: CRISIL Reaffirms B+ Rating on INR.75cr Loan -------------------------------------------------------------- CRISIL has reaffirmed its 'CRISIL B+/Stable/CRISIL A4' ratings on the bank facilities of Gazebo Industries Limited (GIL). Amount Facilities (INR Crore) Ratings ---------- ----------- ------- Cash Credit .75 CRISIL B+/Stable (Reaffirmed) Foreign Exchange Forward 0.10 CRISIL A4 (Reaffirmed) Letter of credit & Bank Guarantee 7.00 CRISIL A4 (Reaffirmed) Packing Credit 10.50 CRISIL A4 (Reaffirmed) The ratings continue to reflect the susceptibility of the company's profitability to volatility in raw material prices, its exposure to risks inherent in tender-based business, and large working capital requirement. These weaknesses are partially offset by the promoters' extensive experience in trading and the company's moderate financial risk profile. Analytical Approach For arriving at the ratings, CRISIL has treated unsecured loans of INR3.09 crore as on March 31, 2018, as neither debt nor equity as the loans are from the promoters and are expected to remain in the business. Key Rating Drivers & Detailed Description Weaknesses * Susceptibility to volatility in raw material prices and exposure to risks inherent in tender-based business: With limited value addition in operations, operating profitability is volatile and susceptible to fluctuations in raw material prices and to risks inherent in the tender-based business. Operating margin was 2.34% in fiscal 2018, and fluctuated between 2.3% and 5.1% in the past four fiscals. * Large working capital requirement: Gross current assets were at 116 days as on March 31, 2018, driven by sizeable receivables and inventory of 65 and 49 days, respectively. Strengths * Promoters' extensive experience in trading: The promoter's experience of over three decades in trading business and established relationships with customers and suppliers should continue to support the business risk profile. * Moderate financial risk profile: Total outside liabilities to adjusted networth ratio was comfortable at 0.85 time as on March 31, 2018, on account of moderate networth of INR14.85 crore, supporting the financial risk profile. Interest coverage ratio was 1.3 times for fiscal 2018. Outlook: Stable CRISIL believes GIL will continue to benefit from the promoters' extensive industry experience and established relationships with customers and suppliers. The outlook may be revised to 'Positive' if a sustained increase in revenue and profitability or improvement in working capital cycle leads to a better financial risk profile. The outlook may be revised to 'Negative' if the financial risk profile and liquidity weaken because of significant decline in cash accrual, substantial increase in working capital requirement, or large, debt-funded capital expenditure. GIL was established in 1970 as a proprietorship firm, Gazebo Industries, and was reconstituted as a private limited company in 1988, and as a closely held public limited company with the current name in 1991. GIL primarily trades in railway parts and has been exporting to Africa for four fiscals. It also trades in plastic granules, polyvinyl chloride resin, and polypropylene woven sacks in the domestic market. GLOBAL ESTATES: CRISIL Maintains 'B' Rating in Not Cooperating -------------------------------------------------------------- CRISIL said the rating on bank facilities of Global Estates AC Ambassador Hotel (GEAH) continues to be 'CRISIL B/Stable Issuer not cooperating'. Amount Facilities (INR Crore) Ratings ---------- ----------- ------- Cash Credit 0.5 CRISIL B/Stable (ISSUER NOT COOPERATING) Proposed Long Term .08 CRISIL B/Stable (ISSUER NOT Bank Loan Facility COOPERATING) Term Loan 8.42 CRISIL B/Stable (ISSUER NOT COOPERATING) CRISIL has been consistently following up with GEAH for obtaining information through letters and emails dated April 30, 2018 and October 30, 2018 among others, apart from telephonic communication. However, the issuer has remained non cooperative. 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 GEAH, which restricts CRISIL's ability to take a forward looking view on the entity's credit quality. CRISIL believes information available on GEAH, is consistent with 'Scenario 1' outlined in the 'Framework for Assessing Consistency of Information with 'CRISIL BB' category or lower'. Based on the last available information, the rating on bank facilities of GEAH continues to be 'CRISIL B/Stable Issuer not cooperating'. GEAH, set up in 2013 by Mr. Simerdeep Singh, operates Ambassador Hotel in Jalandhar. The hotel commenced operations in August 2015. GOPAL KRISHNA: Ind-Ra Maintains 'B' LT Rating in Non-Cooperating ---------------------------------------------------------------- India Ratings and Research (Ind-Ra) has maintained Gopal Krishna Rice Mills' Long-Term Issuer Rating in the non-cooperating category. The issuer did not participate in the rating exercise despite continuous requests and follow-ups by the agency. Therefore, investors and other users are advised to take appropriate caution while using these ratings. The rating will continue to appear as 'IND B (ISSUER NOT COOPERATING)' on the agency's website. The instrument-wise rating action is: -- INR70 mil. Fund-based working capital limit maintained in non-cooperating category with IND B (ISSUER NOT COOPERATING)/IND A4 (ISSUER NOT COOPERATING) rating. Note: ISSUER NOT COOPERATING: The ratings were last reviewed on November 16, 2016. Ind-Ra is unable to provide an update, as the agency does not have adequate information to review the ratings. COMPANY PROFILE Gopal Krishna Rice Mills is a partnership entity engaged in rice milling and sorting. GVRMP WHAGDHARI: CRISIL Lowers Rating on INR202cr LT Loan to D -------------------------------------------------------------- CRISIL has downgraded the rating on bank facilities of GVRMP Whagdhari Ribbanpally Tollway Private Limited (GVRMP) to 'CRISIL D Issuer Not Cooperating' from 'CRISIL B/Stable Issuer Not Cooperating' as there have been delays in servicing debt. Amount Facilities (INR Crore) Ratings ---------- ----------- ------- Long Term Loan 202 CRISIL D (ISSUER NOT COOPERATING; Downgraded from 'CRISIL B/Stable ISSUER NOT COOPERATING') CRISIL has been consistently following up with GVRMP for obtaining information through letters and emails dated December 31, 2017 and April 30, 2018 among others, apart from telephonic communication. However, the issuer has remained non cooperative. 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 GVRMP, which restricts CRISIL's ability to take a forward looking view on the entity's credit quality. CRISIL believes information available on GVRMP is consistent with 'Scenario 1 ' outlined in the 'Framework for Assessing Consistency of Information with CRISIL BB' rating category or lower'. Based on best available information, CRISIL has downgraded the rating to 'CRISIL D Issuer Not Cooperating' from 'CRISIL B/Stable Issuer Not Cooperating' as there have been delays in servicing debt. GVRMP is a special purpose vehicle (SPV) set up as a joint venture in 2010 by GVR Infra Projects Ltd, RMN Infrastructures Ltd, and the Prathyusha group (51:25:24) to improve and widen a 141.2-kilometre stretch (from Maharashtra border to Andhra Pradesh [Whagdhari-Ribbanpally]) of State Highway-10 on build- operate-transfer toll basis. Commercial operations began in September 2012. HARSHA INTERNATIONAL: CARE Reaffirms B+ Rating on INR25cr Loan -------------------------------------------------------------- CARE Ratings reaffirmed ratings on certain bank facilities of Harsha International (HI), as: Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long-term Bank Facilities 25.00 CARE B+; Stable Reaffirmed Detailed Rationale The rating assigned to the bank facilities of HI continues to be tempered by project implementation risk, competition from other players in the industry, seasonality associated with hotel industry and constitution of entity as the partnership firm with inherent risk of withdrawal of capital. The rating also takes into account the 95% completion in the project, although with marginal time and cost overruns and tie up with Concept Hospitality Private Limited (The Ferns Hotels) for management of hotel operations. However, the rating continues to derive benefits from experienced partner, achievement of financial closure and stable demand of hotel industry. Going forward, the ability of the firm to complete the project in timely manner and start the commercial operations as envisaged would be key rating sensitivity. Detailed Description of Key Rating Drivers Key Rating Weaknesses Project implementation risk: The firm plans to construct 80 rooms along with food and beverage facilities. The revised project cost, as on September 30, 2018, is estimated at INR46.37 crore (as compared to INR43.28 crore, envisaged as on, December 31, 2017) of which INR 19.13 crore (41.25%) has been contributed by promoters', INR25.50 crore (55.00%) through term loans and equipment/vehicle loan, and INR0.03 crore through creditors for capital goods. The project is expected to be completed by December 2018 and commercial operations are expected to start from January 2019. The one month gap in commencement of operations is due to firm planned to provide training to its employees. As on September 30, 2018, the firm has incurred INR44.22 crore (95.36% of total project cost) which is funded through partners' capital, term loan and creditors/others. Financial closure achieved for the project. Moreover, any significant time or cost overruns could impact the firm's liquidity and profitability since repayments are scheduled to commence from June 2019. Time overrun by 5 months was recorded in project execution (As originally expected completion date was August 2018) due to change in plans of procuring interiors from abroad instead of from India, Now the firm is importing interior items from China. Competition from other players in the industry: The firm faces competition from a number of small and medium players. Though there are other regional players offering services, along with upcoming players in the market. Seasonality associated with hotel industry: The demand for hotel and hospitality sector has direct relation to the overall health of economy. The Indian hotel industry normally experiences high demand during October-April, followed which the monsoon months entail low demand. Usually the December and March quarters bring in 60% of the year's turnover for India's hoteliers. However, this trend is seeing a change over the recent few years. Hotels have introduced various offerings to improve performance (occupancy) during the lean months. These include targeting the conferencing segment and offering lucrative packages during the lean period. Constitution of entity as the partnership firm: The firm being a partnership firm is exposed to inherent risk of capital withdrawal by partners due its nature of constitution. Any substantial withdrawals from capital account would impact the net worth and thereby the gearing levels. Key Rating Strengths Experienced partner: HI was promoted by Mr Maharudrappa, along with his spouse. Mr. Maharudrappa is a qualified graduate having more than two decades of experience in real estate and other trading business. Tie up with Concept Hospitality Private Limited (The Ferns Hotels) for management of hotel operations: Harsha International (HI) has entered an agreement with Concept Hospitality Private Limited (The Ferns Hotel) to manage the day-to-day operations of the hotel for 15 years and thereafter renewable with mutual consent of parties hereto for further 15 years based on mutually agreed conditions. HI will provide all the facilities for the operation of hotel. The business model is based on the profit sharing between the parties. Stable demand of hotel business: The Indian tourism and hospitality industry has emerged as one of the key drivers of growth among the services sector in India. Tourism in India has significant potential considering the rich cultural and historical heritage, variety in ecology, terrains and places of natural beauty spread across the country. Tourism is also a potentially large employment generator besides being a significant source of foreign exchange for the country. Harsha International (HI) was established in the year 2015. HI is promoted by Mr Maharudrappa along with his spouse Ms. Annapurneswari. The firm plans to engage in hospitality business and offer services in the area of hotel and restaurant under the name "Harsha Internationals". The firm plans to construct 80 rooms along with food and beverage facilities. The revised project cost, as on September 30, 2018, is estimated at INR46.37 crore (as compared to INR43.28 crore, envisaged as on, December 31, 2017) of which INR19.13 crore (41.25%) has been contributed by promoters', INR25.50 crore (55.00%) through term loans and equipment/vehicle loan, and INR0.03 crore through creditors for capital goods. Further, the partners intend to infuse INR1.71 crore as capital into the firm during FY19. IRRILINK DRIP: CRISIL Maintains 'B-' Rating in Not Cooperating -------------------------------------------------------------- CRISIL said the ratings on bank facilities of Irrilink Drip Irrigation Industries (IDII) continues to be 'CRISIL B-/Stable Issuer not cooperating'. Amount Facilities (INR Crore) Ratings ---------- ----------- ------- Cash Credit 3.25 CRISIL B-/Stable (ISSUER NOT COOPERATING) Proposed Cash Credit Limit 1.81 CRISIL B-/Stable (ISSUER NOT COOPERATING) Term Loan 4.94 CRISIL B-/Stable (ISSUER NOT COOPERATING) CRISIL has been consistently following up with IDII for obtaining information through letters and emails dated April 30, 2018 and October 30, 2018 among others, apart from telephonic communication. However, the issuer has remained non cooperative. 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 IDII, which restricts CRISIL's ability to take a forward looking view on the entity's credit quality. CRISIL believes information available on IDII is consistent with 'Scenario 1' outlined in the 'Framework for Assessing Consistency of Information with CRISIL BB' rating category or lower'. Based on the last available information, the ratings on bank facilities of IDII continues to be 'CRISIL B-/Stable Issuer not cooperating'. Incorporated in 2011, IDII is promoted by members of the Mali Ji and Mafa Ji families. The firm manufactures irrigation systems (drip and sprinkler systems) and polyethylene pipes. Facility in Sirohi, Rajasthan, has an installed capacity of 200 kilogram per hour of round drip line, 300 kilogram per hour of flat drip line, 300 kilogram per hour of HDPE pipes and 250 kilogram per hour of mini sprinkler (lateral). J B PUBLISHING: CRISIL Withdraws B+ Rating on INR17.5cr Loans ------------------------------------------------------------- CRISIL has reaffirmed its ratings on the bank facilities of J B Publishing House Private Limited (JBPL) and subsequently Withdrawn the ratings at the company's request and on receipt of a no-objection certificate from the bankers. The withdrawal is in line with CRISIL's policy on withdrawal of bank loan ratings. Amount Facilities (INR Crore) Ratings ---------- ----------- ------- Cash Credit 12.5 CRISIL B+/Stable (Rating reaffirmed and Withdrawn) Long Term Loan 3.5 CRISIL B+/Stable (Rating reaffirmed and Withdrawn) Proposed Term Loan 1.5 CRISIL B+/Stable (Rating reaffirmed and Withdrawn) JBPL was incorporated in 1997, and is promoted by the Agrawal family of Mathura, Uttar Pradesh. The company publishes educational books for pre-school to standard VIII. Mr. Gopal Prasad Agrawal and Mr. Rakesh Kumar Agrawal are its key promoters, and manage operations. JAI JALARAM: CRISIL Maintains 'B' Ratings in Not Cooperating ------------------------------------------------------------ CRISIL said the ratings on bank facilities of Jai Jalaram Ceramic Works Private Limited (JJCWPL) continues to be 'CRISIL B/Stable Issuer not cooperating'. Amount Facilities (INR Crore) Ratings ---------- ----------- ------- Cash Credit 5.5 CRISIL B/Stable (ISSUER NOT COOPERATING) Proposed Long Term 2.0 CRISIL B/Stable (ISSUER NOT Bank Loan Facility COOPERATING) CRISIL has been consistently following up with JJCWPL for obtaining information through letters and emails dated April 30, 2018 and October 30, 2018 among others, apart from telephonic communication. However, the issuer has remained non cooperative. 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 JJCWPL, which restricts CRISIL's ability to take a forward looking view on the entity's credit quality. CRISIL believes information available on JJCWPL is consistent with 'Scenario 1' outlined in the 'Framework for Assessing Consistency of Information with CRISIL BB' rating category or lower'. Based on the last available information, the ratings on bank facilities of JJCWPL continues to be 'CRISIL B/Stable Issuer not cooperating'. JJCWPL, originally set up in 1973, was purchased by its present promoter, Mr. Raman Patel, in 2007. The company undertakes cotton ginning, which contributes the major portion of its revenue, and also manufactures ceramic pipes. It is located in Vijapur, Gujarat, and is managed by Mr. Patel. JAYAHO AGRI: CRISIL Maintains 'D' Rating in Not Cooperating ----------------------------------------------------------- CRISIL said the ratings on bank facilities of Jayaho Agri Ventures Private Limited (JAVPL) continues to be 'CRISIL D Issuer not cooperating'. Amount Facilities (INR Crore) Ratings ---------- ----------- ------- Cash Credit 12 CRISIL D (ISSUER NOT COOPERATING) CRISIL has been consistently following up with JAVPL for obtaining information through letters and emails dated April 30, 2018 and October 30, 2018 among others, apart from telephonic communication. However, the issuer has remained non cooperative. 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 JAVPL, which restricts CRISIL's ability to take a forward looking view on the entity's credit quality. CRISIL believes information available on JAVPL is consistent with 'Scenario 1' outlined in the 'Framework for Assessing Consistency of Information with CRISIL BB' rating category or lower'. Based on the last available information, the ratings on bank facilities of JAVPL continues to be 'CRISIL D Issuer not cooperating'. Set up in 2009 by Mr. Nagothu Sleeva Raju and his family members, JAVPL trades in tobacco. The company is based in Guntur district, Andhra Pradesh. KHUSHI COTSPIN: CARE Assigns B+ Rating to INR9.19cr LT Loan ----------------------------------------------------------- CARE Ratings has assigned rating to the bank facilities of Khushi Cotspin Private Limited (KCPL), as: Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long-term Bank Facilities 9.19 CARE B+; Stable Assigned Detailed Rationale & Key Rating Drivers The rating assigned to the bank facilities of KCPL is constrained on account of small scale of operation with low profitability margins, moderate capital structure, weak debt coverage indicators and working capital intensive nature of operations due to seasonal nature of business. The rating also factors in the susceptibility of margins to fluctuations in cotton prices, presence in fragmented industry with susceptibility to government regulations. The rating, however, derives strength from the experienced promoters and long operational track record of the company as well as locational advantage emanating from proximity to raw material. Ability of the company to increase the overall scale of operations and improve profitability and capital structure amidst intense competition and efficient management of working capital requirement are the key rating sensitivities. Detailed description of Key rating drivers Key rating Weakness Small scale of operations with low profitability margins: The scale of operations of the company remained small with total operating income (TOI) of INR47.59 crore in FY18 (Provisional) and total capital employed of INR14.30 crore as on March 31, 2018, thus limiting financial flexibility of the company in times of stress. Further, the profitability margins of KCPL stood low with PBILDT margin in the range of 1.37%-2.40%%. and PAT margin in the range of 0.15%-1.01% during the last three financial years ended in FY18 (Provisional). Moderate capital structure and weak debt coverage indicators: The capital structure of KCPL stood moderate as reflected by overall gearing ratio of 1.27x as on March 2018. Moreover, with low profitability and moderate gearing levels, the debt coverage indicators of the company remained weak. Working capital intensive nature of operation: The operations of the company remained working capital intensive with gross current asset of 71 days for FY18 (Provisional) with funds majorly blocked in receivables and inventory. The working capital requirements of the company are met by cash credit facility, the utilization of which remained high. Susceptibility to adverse changes in government regulations and climatic condition: The price of raw cotton is highly volatile in nature owing to its seasonal nature and the price is regulated through function of MSP by the government along with export of cotton. Hence, any adverse change in government policy and climatic condition may negatively impact the prices of raw cotton in domestic market and could result in lower realizations and profit for KCPL. Presence in seasonal and fragmented industry: Operation of cotton business is highly seasonal in nature, as the sowing season is from March to July and the harvesting season is spread from November to February. Moreover, on account of large number of units operating in cotton ginning business, the competition within the players remains very high resulting in high fragmentation and further restricts the profitability. Thus, ginning players have very low bargaining power against its customer as well as suppliers. Key rating Strengths Experienced promoters with long operational track record of the company: The company is managed by Mr Gokuldas Lunkaranji Chandak and Mr. Navinkumar Gokuldasji Chandak having an average experience of about one and a half decade in textile industry which aids in smooth operations of the company. The promoters look after the day to day affairs of the business with adequate support from a team of experienced personnel. Moreover, the promoters continuously infuse capital into the business to support the growing scale of operations. Locational advantage emanating from proximity to raw material: KCPLs unit has close proximity to local markets of Akola, major raw material procurement destinations for the entity. Akola is one of the major cotton producing districts in vidarbha region of central India. Furthermore, the plant is having good transportation facilities and other requirements like good supply of power, water etc. Accordingly, KCPL has locational advantage in terms of proximity to raw material and connectivity. KCPL, incorporated in 2013 was promoted by Ms. Kavita Navinkumar Chandak, Mr. Gokuldas Lunkaranji Chandak, Mr. Navinkumar Gokuldasji Chandak and Mr. Nirmala Chandak. The company is engaged in cotton ginning & pressing and processing of cotton seeds to produce cotton seed oil and oil cake at its manufacturing facility located at Akot, Akola with an installed capacity for cotton seeds - 80,000 quintal, cotton seed oil - 15,000 quintal, oil cake 60,000 quintal and Cotton bales 70000 Metric tonnes per annum. KCPL has one group company namely Pramodkumar Pravinkumar Ginning and Pressing Factory which is also engaged in similar line of business. LAKSHMI COT: CARE Reaffirms B+ Rating on INR13.10cr LT Loan ----------------------------------------------------------- CARE Ratings reaffirmed ratings on certain bank facilities of Lakshmi Cot Fab Private limited (LCFPL), as: Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long-term Bank Facilities 13.10 CARE B+; Stable Reaffirmed Detailed Rationale & Key Rating Drivers The rating assigned to the bank facilities of LCFPL continues to remain constrained on account of its overall financial risk profile marked by moderate scale of operations, low profit margins, moderate capital structure, weak debt coverage indicators and working capital intensive nature of operations duringFY18 (FY refers to the period April 1 to March 31). The rating, further, continues to remain constrained on account of susceptibility of operating margins to cotton price fluctuation and presence in a highly fragmented and competitive cotton industry with regulatory controls. The rating, however, continues to derive strength from the vast experience of promoters and location advantage on account of it being located in the cotton producing belt of Gujarat. The ability of LCFPL to improve its scale of operations, profit margins and solvency position along with efficient working capital management are the key rating sensitivities. Detailed description of the key rating drivers Key Rating Weaknesses Moderate scale of operations with low profit margins: The total operating income (TOI) of LCFPL increased by 6.21% y-o-y and continued to remain moderate at INR62.51 crore during FY18 as against INR58.86 crore in FY17. Furthermore, PBILDT margin of LCFPL continued to remain low at 2.82% in FY18 from 2.76% in FY17 while the PAT margin continued to remain thin at 0.33% in FY18. Moderate capital structure, weak debt coverage indicators and working capital intensive nature of operations: The capital structure of LCFPL, though improved, continued to remain moderate as marked by overall gearing ratio of 2.43 times as on March 31, 2018 as against 4.01 times as on March 31, 2017. Furthermore, the debt coverage indicators, though improved, continued to remain weak as marked by total debt to GCA of 16.12 times as on March 31, 2018 (27.44 times as on March 31, 2017), while the interest coverage remained moderate at 1.70 times during FY18. The operations of LCFPL continued to remain working capital intensive in nature marked by current ratio of 1.38 times as on March 31, 2018 as against 1.33 times as on March 31, 2017. Operating cycle remained elongated at 82 days in FY18, while average utilization of its working capital facilities remained moderate at around 80% during past 12 months period ended September, 2018. Susceptibility of operating margins to cotton price fluctuation and presence in a highly fragmented and competitive cotton industry with regulatory controls: The main raw material used by LCFPL is raw cotton, the prices of which are highly volatile in nature, cotton being a seasonal crop having dependency upon the vagaries of monsoon resulting into a higher inventory holding period for the business. Furthermore, LCFPL operates in highly fragmented market characterized by presence of large numbers of unorganized players. Also, the cotton supply and prices in India are highly regulated by government through MSP (Minimum Support Price) fixed by government and export regulations. Key Rating Strengths Experienced promoters along with established track record of operations: LCFPL is promoted by Mr. Nimish Lotiya, Mr. Vishal Lotiya and Mr. Harilial Khakhar who have an experience of more than a decade in the field of cotton ginning through other group entity namely Lakshmi Cot Gin Private Limited which is in the similar line of business. Location Advantage: The manufacturing facilities of LCFPL are located in Gujarat, which is one of the largest producers of cotton in India resulting in benefits derived from lower logistic expenditure, easy availability and procurement of raw materials at effective prices, labour, water and power connection. Rajkot-based (Gujarat) LCFPL was incorporated in September, 2013 by Mr. Nimish Lotiya, Mr. Vishal Lotiya and Mr. Harilal Khakhar. LCFPL is engaged into cotton ginning, cleaning and bailing process having an installed capacity of 350 full pressed cotton bales per day (165 kg each) as on March 31, 2018. The company procures raw cotton from farmers and sells its final products in domestic market to the states like Gujarat, Maharashtra, Tamil Nadu etc. LAMANE INFRA: Ind-Ra Maintains 'BB-' LT Rating in Non-Cooperating ----------------------------------------------------------------- India Ratings and Research (Ind-Ra) has maintained Lamane Infrastructure Private Limited's Long-Term Issuer Rating in the non-cooperating category. The issuer did not participate in the rating exercise despite continuous requests and follow-ups by the agency. Therefore, investors and other users are advised to take appropriate caution while using these ratings. The rating will continue to appear as 'IND BB- (ISSUER NOT COOPERATING)' on the agency's website. The instrument-wise rating action is: -- INR200 mil. Term loan maintained in non-cooperating category with IND BB- (ISSUER NOT COOPERATING) rating. Note: ISSUER NOT COOPERATING: The ratings were last reviewed on November 8, 2016 Ind-Ra is unable to provide an update, as the agency does not have adequate information to review the ratings. COMPANY PROFILE Incorporated in 1980, Lamane Infrastructure runs a real estate development business. M.K.V.K. TIMBERS: CRISIL Reaffirms 'B' Rating on INR8.5cr Loan -------------------------------------------------------------- CRISIL has reaffirmed its ratings on the bank facilities of M.K.V.K. Timbers and Saw Mills (MKVKTSM) at 'CRISIL B/Stable/CRISIL A4'. Amount Facilities (INR Crore) Ratings ---------- ----------- ------- Cash Credit 1.25 CRISIL B/Stable (Reaffirmed) Foreign Letter of Credit 8.50 CRISIL B/Stable (Reaffirmed) Proposed Short Term Bank Loan Facility 1.25 CRISIL A4 (Reaffirmed) The rating continues to reflect the group's modest scale of operations, its large working capital requirement and weak financial risk profile. These weaknesses are partly offset by the promoters' experience in the timber industry. Analytical Approach For arriving at its ratings, CRISIL has combined the business and financial risk profiles of MKVKTSM and its sister concern Sri M.K.V.Kandasamy Nadar Firm (MKVKNF). This is because the two firms, together referred to as the MKVK group, are under common promoters, in the same line of business, and have fungible cash flows between them. Key Rating Drivers & Detailed Description Weaknesses: * Modest scale of operations in a highly fragmented industry: The group's modest scale of operations is reflected in revenue of about INR18 crore in fiscal 2018 in a highly fragmented timber industry and should continue to constrain its profitability. * Large working capital requirement: Operations are working capital intensive marked by gross current assets (GCA) of 288 days as on March 31, 2018, due to high inventory of 188 days and moderate debtors of 89 days. Inventory remains high, owing to high lead time in procurement and seasonal availability of timber. Strength * Promoters' extensive experience in the timber trading business: Benefits from promoters' experience of over three decades in the timber trading business should continue to support the business risk profile. Outlook: Stable CRISIL believes the MKVK group will continue to benefit from its established relationships with customers. The outlook may be revised to 'Positive' if scaling up of operations along with improvement in profitability, leads to better liquidity. The outlook may be revised to 'Negative' if stretch in the working capital cycle or deterioration in margins weakens liquidity. Established in 1987 in Pavoorchatram, Tamil Nadu, MKVKTSM, promoted by Mr KP Arunachalarajan and Mr J Thilagam, processes and trades in timber, MKVKNF trades in timber, cement, asbestos, bamboo, and thermo-mechanically treated bars. NAMAN METAL: CRISIL Assigns B+ Rating to INR6.25cr Cash Loan ------------------------------------------------------------ CRISIL has assigned its 'CRISIL B+/Stable' rating to the bank facility of Naman Metal (NM). The rating reflects firm's modest scale of operations in a competitive industry, and below average financial risk profile. These weaknesses are partially offset by the promoter's extensive experience in steel trading business and established relationship with customers. Amount Facilities (INR Crore) Ratings ---------- ----------- ------- Cash Credit 6.25 CRISIL B+/Stable (Assigned) Analytical Approach Unsecured loans of INR1.08 crore as on March 31, 2018 has been treated as Neither debt nor equity as these loans are extended by promoter and his friends/family members and would remain in business over medium term. Key Rating Drivers & Detailed Description Weaknesses * Modest scale of operations in a competitive industry: Scale of operations is modest, with revenue of INR19.89 crore in fiscal 2018. Competitive and fragmented nature of industry restricts scalability and profitability. Further business is dependent on uninterrupted import of steel scrap and end user industry demand. * Below-average financial risk profile: Modest networth and high gearing - INR1.98 crore and 1.62 times, respectively, as of March 2018 - keep financial risk profile below-average. Debt protection metrics are subdued: interest coverage was at 1.3 times in fiscal 2018. Large working capital requirements should keep financial risk profile constrained over medium term. Strengths * Extensive industry experience of promoter: NM's promoter Mr. Shripal Jain, has been in the steel scrap trading business for over one and half decades, leading to strong expertise and established relationship with its customers and suppliers. This will continue to support the business risk profile in the medium- term. Outlook: Stable CRISIL believes NM will continue to benefit over the medium term from the extensive experience of its proprietor. The outlook may be revised to 'Positive' if there is substantial increase in revenue & operating margin, leading to healthy cash accruals coupled with improvement in financial risk profile. Conversely, the outlook may be revised to 'Negative' if low cash accrual or large working capital requirements weaken financial risk profile and liquidity. NM a proprietorship firm, is involved in trading of stainless steel scrap and is based out of Mumbai. The firm imports scrap materials and sells it to domestic customers. NEW AGE: CRISIL Lowers Rating on INR3cr Cash Loan to D ------------------------------------------------------ CRISIL has downgraded its ratings on bank facilities of New Age False Ceiling Private Limited (NAFCPL) to 'CRISIL D/CRISIL D' from 'CRISIL B+/Stable/CRISIL A4'. Amount Facilities (INR Crore) Ratings ---------- ----------- ------- Cash Credit 3 CRISIL D (Downgraded from 'CRISIL B+/Stable') Letter of Credit 2 CRISIL D (Downgraded from 'CRISIL A4') Proposed Long Term 3 CRISIL D (Downgraded from Bank Loan Facility 'CRISIL B+/Stable') The rating action follows ongoing delays in servicing term debt obligations and overdrawals in cash credit utilization due to NAFCPL's weak liquidity. The rating also reflects NAFCPL's modest scale of operations and below-average financial risk profile. However, it benefits from extensive experience of promoters. Key Rating Drivers & Detailed Description Weakness * Overdrawals in cash credit limit and ongoing delays in term loan repayment: There are overdrawals in cash credit utilization for more than 30 days. Also, there are ongoing delays in repayment of term loan. This is primarily on account of weak liquidity marked by stretched receivables. * Modest scale of operations: Small scale of operations is reflected in modest revenue of INR43 crore in fiscal 2017. * Below-average financial risk profile: Total outside liabilities to tangible networth ratio was high at 5 times as on March 31, 2017, while interest coverage and net cash accrual to total debt ratios were weak at 1.5 times and 0.06 time, respectively, in fiscal 2017. Strength * Experience of promoters: Benefits derived from the promoters' experience of over two decades and relations with customers and suppliers should continue to support the business. NAFCPL, incorporated in 2008, manufactures false ceilings at its facility in Nagpur, Maharashtra. It started production in 2012; before that, it traded in false ceiling materials. Mr Manoj Gupta and family are the promoters. PERFECT INFRAENGINEERS: Ind-Ra Affirms 'D' LT Issuer Rating ----------------------------------------------------------- India Ratings and Research (Ind-Ra) has affirmed Perfect Infraengineers Ltd.'s Long-Term Issuer Rating at 'IND D' and simultaneously migrated the rating to the non-cooperating category. The issuer did not participate in the rating exercise despite continuous requests and follow-ups by the agency. Thus, the rating is based on the best available information. Therefore, investors and other users are advised to take appropriate caution while using the rating. The rating will now appear as 'IND D (ISSUER NOT COOPERATING)' on the agency's website. The instrument-wise rating actions are: -- INR0.9 mil. Term loan (long-term) due on March 2020 affirmed and migrated to Non-Cooperating Category with IND D (ISSUER NOT COOPERATING) rating; -- INR47.5 mil. Fund-based working capital limits (long-term) affirmed and migrated to Non-Cooperating Category with IND D (ISSUER NOT COOPERATING) rating; and -- INR45 mil. Non-fund-based working capital limits (short-term) affirmed and migrated to Non-Cooperating Category with IND D (ISSUER NOT COOPERATING) rating. Note: ISSUER NOT COOPERATING: Issuer did not cooperate; Based on the best available information KEY RATING DRIVERS The affirmation reflects continued delays by Perfect Infraengineers in debt servicing, the details of which are not available. RATING SENSITIVITIES Positive: Timely debt servicing for at least three consecutive months could result in an upgrade. COMPANY PROFILE Incorporated in 1993, Perfect Infraengineers is a turnkey project contractor for the supply, installation, testing, commissioning and maintenance of mechanical, electrical and plumbing and heating, ventilation and air conditioning equipment. It is listed on the National Stock Exchange. PRAMODKUMAR PRAVINKUMAR: CARE Assigns B+ Rating to INR9.29cr Loan ----------------------------------------------------------------- CARE Ratings has assigned rating to the bank facilities of Pramodkumar Pravinkumar Ginning and Pressing Factory (PP), as: Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long term Bank Facilities 9.29 CARE B+; Stable Assigned Detailed Rationale & Key Rating Drivers The rating assigned to the bank facilities of PP is constrained on account of small scale of operation with low profitability margins, leveraged capital structure, weak debt coverage indicators and working capital intensive nature of operations due to seasonal nature of business. The rating also factors in the susceptibility of margins to fluctuations in cotton prices, presence in fragmented industry with susceptibility to government regulations and partnership nature of constitution of firm. The rating, however, derives strength from the experienced promoters and long operational track record of the entity as well as locational advantage emanating from proximity to raw material. Ability of the entity to increase the overall scale of operations and improve profitability and capital structure amidst intense competition and efficient management of working capital requirement are the key rating sensitivities. Detailed description of Key rating drivers Key rating Weakness Small scale of operations with low profitability margins: The scale of operations of the entity remained small with total operating income (TOI) of INR54.19 crore in FY18 (Provisional) and total capital employed of INR13.89 crore as on March 31, 2018, thus limiting financial flexibility of the entity in times of stress. Further, the profitability margins of PP stood low with PBILDT margin in the range of 1.61%-2.93% and PAT margin in the range of 0.06%-0.96% during the last three financial years ended in FY18 (Provisional). Leveraged capital structure and weak debt coverage indicators: The capital structure of PP stood leveraged as reflected by overall gearing ratio of 2.76x as on March 2018. Moreover, with low profitability and high gearing levels, the debt coverage indicators of the entity remained weak. Working capital intensive nature of operation: The operations of the entity remained working capital intensive with gross current asset of 72 days for FY18 (Provisional) with funds majorly blocked in inventory. The working capital requirements of the entity are met by cash credit facility, the utilization of which remained high. Susceptibility to adverse changes in government regulations and climatic condition: The price of raw cotton is highly volatile in nature owing to its seasonal nature and the price is regulated through function of MSP by the government along with export of cotton. Hence, any adverse change in government policy and climatic condition may negatively impact the prices of raw cotton in domestic market and could result in lower realizations and profit for PP. Presence in seasonal and fragmented industry: Operation of cotton business is highly seasonal in nature, as the sowing season is from March to July and the harvesting season is spread from November to February. Moreover, on account of large number of units operating in cotton ginning business, the competition within the players remains very high resulting in high fragmentation and further restricts the profitability. Thus, ginning players have very low bargaining power against its customer as well as suppliers. Partnership nature of constitution of firm: Being a partnership concern, PP has inherent risk of withdrawal of partner's capital at the time of personal contingency. Furthermore, it has restricted access to external borrowings where net worth as well as creditworthiness of the promoter are the key factors affecting credit decision of the lenders. Hence, limited funding avenues along with limited financial flexibility have resulted in small scale of operations for the firm. Key rating Strengths Experienced promoters with long operational track record of the entity: The entity is managed by Mr. Pramodkumar Chandak and Mr. Navinkumar Gokuldasji Chandak having an average experience of about one and a half decade in textile industry which aids in smooth operations of the entity. The promoters look after the day to day affairs of the business with adequate support from a team of experienced personnel. Moreover, the promoters continuously infuse capital into the business to support the growing scale of operations. Locational advantage emanating from proximity to raw material: PP's unit has close proximity to local markets of Akola, major raw material procurement destinations for the entity. Akola is one of the major cotton producing districts in vidarbha region of central India. Furthermore, the plant is having good transportation facilities and other requirements like good supply of power, water etc. Accordingly, PP has locational advantage in terms of proximity to raw material and connectivity. PP incorporated in 1999 was promoted by Mr. Pramodkumar Chandak, Mr. Navinkumar Chandak, Mr. Pravinkumar Chandak. The firm is engaged in cotton ginning & pressing and processing of cotton seeds to produce cotton seed oil and oil cake and cotton bales at its manufacturing facility located at Akola with installed capacity for cotton seeds - 65,000 quintal, cotton seed oil - 15,000 quintal, oil cake 60,000 and Cotton bales 70000 metric tonnes per annum. PP has one group company namely Khushi Cotspin Private Limited which is also engaged in same line of business. PSK TEXTILES: Ind-Ra Assigns BB+ LT Issuer Rating, Outlook Stable ----------------------------------------------------------------- India Ratings and Research (Ind-Ra) has assigned PSK Textiles India Private Limited (PSK) a Long-Term Issuer Rating of 'IND BB+'. The Outlook is Stable. The instrument-wise rating actions are: -- INR50 mil. Term loan due on May 2024 assigned with IND BB+/Stable rating; and -- INR50 mil. Fund-based facilities assigned with IND BB+/ Stable/IND A4+ rating. KEY RATING DRIVERS The ratings reflect PSK's small scale of operations. Its revenue raised 3.8% yoy to INR105 million in FY18, driven by an increase in the number of orders obtained and executed. PSK achieved INR205.8 million in revenue during April-September 2018. The ratings also reflect a modest EBITDA margin of 35.8% in FY18 (FY17: 44.1%). The decline in the margin was due to an increase in variable expenses. Moreover, its return on capital employed was 7% in FY18 (FY17: 10%). The ratings further reflect the project risk associated with PSK's ongoing INR350 million capex (80% debt-funded) for the modernization of machinery. The company plans to buy additional 60 air jet looms. The ratings, however, are supported by PSK's comfortable credit metrics. Its gross interest coverage (operating EBITDAR/gross interest expense) was 4.2x in FY18 (FY17: 4.0x). The marginal improvement in the coverage was driven by a decrease in interest expenses. Its net financial leverage (adjusted net debt/operating EBITDA) was stable at 2.3x in FY18 (FY17: 2.3x) because of a decrease in debt to INR87 million from INR105 million. Ind-Ra expects PSK's credit metrics to deteriorate to modest in FY20, as the majority of the debt will disbursed in that year. The ratings are also supported by PSK's comfortable liquidity. Its average maximum fund-based limit utilization was 35 % for the 12 months ended October 2018. The ratings also benefit from the three-decade-long experience of the promoter in the textile industry that enables it to maintain strong customer relationships. RATING SENSITIVITIES Negative: A decline in the revenue and the EBITDA margin, leading to deterioration in the credit metrics, all on a sustained basis, or a stretch in the liquidity position would be a negative for the ratings. Positive: A substantial improvement in the revenue while maintaining the EBITDA margin, leading to an improvement in the credit metrics, all on a sustained basis, would be positive for the ratings. COMPANY PROFILE Incorporated in 2005 by Mr. KS Shekar, Namakkal (Tamil Nadu)- based PSK primarily weaves fabrics on job work basis. RANGOLI INDUSTRIES: CARE Assigns B+ Rating to INR12.50cr Loan ------------------------------------------------------------- CARE Ratings has assigned rating to the bank facilities of Rangoli Industries Private Limited (RIPL), as: Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long-term Bank 12.50 CARE B+; Stable Assigned Facilities Long-term/ 0.43 CARE B+; Stable/CARE A4 Short-term Assigned Bank Facilities Detailed Rationale & Key Rating Drivers The ratings assigned to the bank facilities of RIPL are constrained on account of its modest scale of operations with thin profit margins, working capital intensive nature of its operations and weak debt coverage indicators during FY18 (refers to the period April 1 to March 31). The ratings, further, are constrained due to susceptibility of its operations to raw material price fluctuation and inherent cyclicality associated with the textile industry. The ratings, however, derive strength from the vast experience of RIPL's promoters along with well established presence in the textile industry, location advantage and comfortable capital structure. The ability of RIPL to improve its scale of operations, profitability and solvency position with effective working capital management are the key rating sensitivities. Detailed description of key rating drivers Key Rating Weaknesses Modest scale of operations with thin profit margins: The scale of operations declined marked by total operating income of INR45.81 crore during FY18 (Prov.) as against INR72.43 crore during FY17 (A) due to adverse effect of implementation of GST Tax Regime during FY18. RIPL's PBILDT margin stood moderate at 6.29% during FY18 (Prov.) as compared to 3.54% during FY17, while the PAT margin of the company stood thin at 0.54% during FY18 (Prov.) as against net losses in FY17. Working capital intensive nature of operations and weak debt coverage indicators: The operations of RIPL are working capital intensive in nature marked by elongated operating cycle at 130 days and a moderate current ratio at 1.44 times as on March 31, 2018 (Prov.). Also, the average working capital limit utilization remained high at ~95% for the past 12 months period ended July, 2018. The debt coverage indicators of the company stood weak marked by total debt to GCA of 14.20 times and interest coverage of 1.47 times during FY18 (Prov.). Susceptibility of operations to raw material price fluctuation and inherent cyclicality associated with the textile industry: Textile is a cyclical industry and closely follows the macroeconomic business cycles. High competitive intensity in the textile industry, volatility of cotton prices and sluggish demand outlook from developed markets are the major cause of concern for the Indian textile industry. Prices of raw cotton are volatile in nature and depend upon different factors. Further, due to fragmented nature of the industry, ability of the company to pass on the increase in raw material prices to end customers is limited and is usually accompanied by a time lag. Key Rating Strengths Experienced promoters and well established presence in the textile industry: RIPL is managed by Mr. Arun Kumar Agarwal and Ms. Sangita Agarwal; each director holding a vast experience of more than two and a half decades in the textile industry. RIPL's presence in this industry for more than two decades has helped it in establishing long term associations and getting repeat orders from customers. Location advantage due to presence in textile hub of Gujarat: The manufacturing facility of the company is situated in Surat (Gujarat) which is considered to be one of the major textile hubs of the country. RIPL's presence in the textile manufacturing region results in benefit derived from easy availability of labour, raw material and logistics. Comfortable capital structure: The capital structure of RIPL is comfortable as marked by LT debt equity ratio and overall gearing ratio of 0.03 times and 0.88 times respectively as on March 31, 2018 (Prov.) (P.Y.: 0.06 times and 0.93 times respectively). Surat-based (Gujarat) RIPL was incorporated in April 1997 as a private limited company which was promoted by Mr. Arun Kumar Agarwal. Later during the year 2015 Ms. Sangita Agarwal also joined as director in RIPL. RIPL is engaged into manufacturing of texturized yarn. The company also generates revenue from trading of Partially Oriented Yarn (POY) and Jari. The manufacturing unit of the company is located near Mangrol, Surat, which has an installed capacity of 6,834 tonnes per annum for manufacturing texturized yarn as on March 31, 2018. It purchases Partially Oriented Yarn (POY) from domestic market and sells its final products to manufacturers of textile fabrics and related products. RIPL has associate entities namely Gedeelon Texo Twist Private Limited, Zoom Synthetic Private Limited and Sundaram Sizers which are into same line of business. RATHI SPECIAL: CRISIL Withdraws B Rating on INR28cr Cash Loan ------------------------------------------------------------- Due to inadequate information, CRISIL, in line with SEBI guidelines, had migrated the rating of Rathi Special Steels Limited (RSSL) to 'CRISIL B/Stable/CRISIL A4/Issuer not cooperating'. CRISIL has withdrawn its rating on bank facility of RSSL following a request from the company and on receipt of a 'no dues certificate' from the banker. Consequently, CRISIL is migrating the ratings on bank facilities of RSSL from 'CRISIL B/Stable/CRISIL A4/Issuer Not Cooperating to 'CRISIL B/Stable/CRISIL A4'. The rating action is in line with CRISIL's policy on withdrawal of bank loan ratings. Amount Facilities (INR Crore) Ratings ---------- ----------- ------- Cash Credit 28.00 CRISIL B/Stable (Migrated from 'CRISIL B/Stable ISSUER NOT COOPERATING'; Rating Withdrawn) Letter of Credit 1.25 CRISIL A4 (Migrated from 'CRISIL A4 ISSUER NOT COOPERATING'; Rating Withdrawn) Proposed Long 3.15 CRISIL B/Stable (Migrated Term Bank Loan from 'CRISIL B/Stable ISSUER Facility NOT COOPERATING'; Rating Withdrawn) Term Loan 13.60 CRISIL B/Stable (Migrated from 'CRISIL B/Stable ISSUER NOT COOPERATING'; Rating Withdrawn) RSSL was set up by Mr. Kamlesh Kumar Rathi in 2004. The company manufactures steel long products such as cold twisted deformed bars and thermo-mechanically treated (TMT) steel bars of various dimensions. It markets its products under the Rathi and Rathi Thermex brands. It is managed by Mr. Rathi and his sons, Mr. Anupam Rathi and Mr. Anurag Rathi. RSSL's manufacturing facility at RIICO Industrial Area at Bhiwadi in Alwar, Rajasthan, has a rolling mill capacity of 150,000 tonnes per annum. RATTAN KAUR: Ind-Ra Maintains 'BB-' LT Rating in Non-Cooperating ---------------------------------------------------------------- India Ratings and Research (Ind-Ra) has maintained Rattan Kaur's Long-Term Issuer Rating in the non-cooperating category. The issuer did not participate in the rating exercise despite continuous requests and follow-ups by the agency. Therefore, investors and other users are advised to take appropriate caution while using these ratings. The rating will continue to appear as 'IND BB- (ISSUER NOT COOPERATING)' on the agency's website. The instrument-wise rating actions are: -- INR13.9 mil. Fund-based limits maintained in non-cooperating category IND BB- (ISSUER NOT COOPERATING) rating; -- INR1.12 mil. Non-fund-based limits maintained in non- cooperating category with IND A4+ (ISSUER NOT COOPERATING) rating; and -- INR49.76 mil. Term loans maintained in non-cooperating category with IND BB- (ISSUER NOT COOPERATING) rating. Note: ISSUER NOT COOPERATING: The ratings were last reviewed on October 3, 2016. Ind-Ra is unable to provide an update, as the agency does not have adequate information to review the ratings. COMPANY PROFILE Incorporated in 2011, Rattan Kaur is a partnership firm that provides LPG transportation services to major oil companies such as Bharat Petroleum Corporation Limited, Indian Oil Corporation Limited ('IND AAA'/Stable) and Hindustan Petroleum Corporation Limited ('IND AAA'/Stable) in the eastern region of India. SHREE DOODHAGANGA: Ind-Ra Assigns 'BB-' LT Rating, Outlook Stable ----------------------------------------------------------------- India Ratings and Research (Ind-Ra) has assigned Shree Doodhaganga Krishna Sahakari Sakkare Karkhane Niyamit (SDKSSKN) a Long-Term Issuer Rating of 'IND BB-'. The Outlook is Stable. The instrument-wise rating action is: -- INR 600 mil. Fund-based working capital facilities assigned with IND BB-/Stable/IND A4+ rating. KEY RATING DRIVERS The ratings reflect SDKSSKN's weak credit profile. Interest coverage (EBITDA/interest) and net leverage (net debt/EBITDA) improved to 1.1x in FY18 (FY17: 0.5x) and 6.4x (16x) on account of a higher operating profitability, lower debt and lower interest expenses. The operating profitability improved to INR357 million in FY18 (FY17: INR211 million) due to increased revenue share of the higher margin co-generation segment in the overall revenues, lower repair and maintenance costs and other operating expenses. In that respect, the operating margins, albeit modest, improved to 7.7% in FY18 (FY17: 5.1%). The ROCE was 3% in FY18 (FY17: negative 1%). Ind-Ra expects the credit profile to moderate further in the near term, primarily on account of weak accruals and increased working capital requirements mainly because of likely higher sugar production for SS 2018-19 and regulated release of sugar. However, the credit metrics are likely to remain comfortable for the rating level on account of modest levels of term debt and no capex plans as on date. The co-operative also has a modest liquidity position, which is evidenced from a weak debt service coverage ratio, current ratio and high TOL/TNW ratio. However, its maximum utilization of the fund-based working capital facilities averaged 82% of the drawing power in the 12 months ended September 2018 on account of lower working capital requirements. Ind-Ra expects the liquidity position to remain tight in the near term on account of pressure on operating profitability (due to weak sugar prices, higher cane costs), increased working capital requirements and sizeable repayment obligations. However, the measures introduced by the government to support the industry such as minimum support price, cane subsidy, regulated release of sugar etc. would mitigate liquidity pressure to certain extent. Moreover, the support from member co-operative societies provides some degree of liquidity cushion to the co-operative. The ratings are supported by SDKSSKN's fully integrated nature and moderate scale of operations, which provide cushion against volatility in sugar segment and support cash flows. The co- operative has a medium-term power purchase agreement with five distribution companies in Karnataka for the export of surplus power and contracts with oil marketing companies to supply ethanol at government-regulated rates. In FY18, SDKSSKN's revenues grew 10.9% yoy to INR4,635 million (FY17: INR4,181 million). The ratings are also supported by extensive operational track record of the co-operative of over four decades in the sugar industry, which has led to established relationships with suppliers and customers. Moreover, the co-operative has taken various initiatives such as implementing lift and drip irrigation, distribution of seeds, seedlings, compost and fertilizer etc., free soil & water testing to improve yields, recovery, command area and water availability. RATING SENSITIVITIES Negative: A significant decline in the operating profitability and/or liquidity position leading to deterioration in the credit metrics, all on a sustained basis, will be negative for ratings. Positive: A significant improvement in the operating profitability and/or liquidity position leading to an improvement in the credit metrics, all on a sustained basis, will be positive for the ratings. COMPANY PROFILE SDKSSKN has an integrated sugar plant with a cane crushing, distillery and power generation capacity of 9,000 tons of cane crushed/day, 30,000 liter/day and 28.7MW, respectively, in Chikodi, Karnataka. SREE PADMANABHA: CARE Moves B+ Rating to Not Cooperating Category ----------------------------------------------------------------- CARE Ratings has migrated the rating on bank facility of Sree Padmanabha Cashew to Issuer Not Cooperating category. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long-term Bank 5.00 CARE B+; Issuer Not Cooperating; Facilities Based on best available Information Short-term Bank 0.50 CARE A4; Issuer Not Cooperating; Facilities Based on best available Information Detailed Rationale & Key Rating Drivers CARE has been seeking information from Sree Padmanabha Cashew to monitor the rating vide e-mail communications dated July 10, 2017, August 16, 2018, August 30, 2018, October 10, 2018 and October 15, 2018 and numerous phone calls. However, despite CARE's repeated requests, the firm has not provided the requisite information for monitoring the rating. In line with the extant SEBI guidelines, CARE has reviewed the rating on the basis of best available information which however, in CARE's opinion is not sufficient to arrive at fair rating. The rating on Sree Padmanabha Cashew's bank facilities will now be denoted as CARE B+; Stable/CARE A4; ISSUER NOT COOPERATING. Users of this rating (including investors, lenders and the public at large) are hence requested to exercise caution while using the above rating. Detailed description of the key rating drivers At the time of last rating on August 29, 2017, the following were the rating strengths and weaknesses: Key Rating Weakness Small scale of operations: The firm has small size of operations marked by low networth of INR0.48 crore as on March 31, 2016 albeit year-on-year increase from INR0.30 crore as on March 31, 2014. Furthermore, TOI even though more than tripled during the review period, stood small at INR13.91 crore in FY16. Declining profitability margins: The profitability margins of the firm have been declining year-on-year during the review period. The PBILDT margin of the firm has been decreasing year-on-year from 11.64% in FY14 to 1.60% in FY16 due to increasing competition from various players along with low value addition associated with manufacturing of cashew based products. Furthermore, the PAT margin has also been declining in line with the PBILDT margin and stood at 0.79% in FY16 due to under absorption of fixed expenses. Fragmented and competitive business segment: The firm is into a fragmented business segment and competitive industry. The market consists of several small to medium-sized companies that compete with each other along with several large enterprises. Constitution as a proprietorship concern with risk of withdrawal of capital: SPC was established as a proprietorship concern and the risk of withdrawal of proprietor's capital prevails. There is parity between the existence of the firm and proprietor's life. Key Rating Strengths Experienced proprietor in manufacturing cashew nuts: The proprietor of SPC, Ms. Anithakumari and her husband, Mr. Muraleedharan Nair has experience of more than two decades in manufacturing cashew nuts. Growth in total operating income during review period: The total operating income (TOI) of the firm had more than tripled from INR0.77 crore in FY14 to INR13.91 crore in FY16 on account of increased production and sale of cashew based products. The firm reported a TOI of INR16.58 crore for FY17 (Prov.). Clientele base in three states: The firm's clientele base comprises of customers located in the states of Madhya Pradesh, Kerala and Tamil Nadu. The customers of SPC include Rajkumar Magasthi Traders, Nijam Private Limited, Sri Vinayaga Cashew, Sai Export Enterprises, Poorna Chandra Cashew and Sailakshmi Cashew. The firm procures its raw material being raw cashew fruits from Singapore, Dubai and from local suppliers in Kerala and Tamil Nadu. Growing demand for cashew based products across the globe: India accounts for about 65 per cent of global cashew exports and exports cashew kernels to over 60 countries. Its major markets are the US, the Netherlands, Japan, Spain, France, Germany, the UK as well as Middle East countries such as the UAE and Saudi Arabia. Comfortable working capital cycle along with satisfactory capital structure and debt coverage indicators: The firm's working capital cycle stood comfortable at 24 days in FY16. The firm procures raw cashew fruits from its suppliers and avails a credit period of upto one week and sells it to its customers predominantly on cash and carry basis. The working capital utilization of SPC stood at 54% in the last one year ended July 30, 2017. The capital structure of the firm marked by overall gearing stood satisfactory at 1.54x as on March 31, 2016, however, deteriorated from 0.87x as on March 31, 2014 on the back of increase in total debt associated with utilisation of cash credit facilities for managing day-to-day business. The interest coverage ratio, though stood satisfactory, has been deteriorating year-on-year from 14.74x in FY14 to 4.19x in FY16 due to increasing finance charges associated with short term borrowings. Furthermore, TD/GCA increased from 2.52x in FY15 to 4.61x in FY16 due to increase in working capital borrowings from TMB Ltd. The current ratio of SPC has been decreasing year-on-year and stood at 1.24x as of FY16 since the increase in current liabilities associated with short term borrowings. Sree Padmanabha Cashew (SPC) was established on May 23, 2013 by Ms. O.A. Anithakumari in Kannumamoodu, Kanyakumari, Tamil Nadu. The firm is engaged in manufacturing of cashew nuts. The installed capacity of SPC stood at approx. 16 tonnes per month with utilization capacity of 86% as of August 07, 2017. SRI M.K.V. KANDASAMY: CRISIL Reaffirms B Rating on INR6cr Loan -------------------------------------------------------------- CRISIL has reaffirmed its ratings on the bank facilities of Sri M.K.V. Kandasamy Nadar Firm (MKVKNF) at 'CRISIL B/Stable/CRISIL A4'. Amount Facilities (INR Crore) Ratings ---------- ----------- ------- Cash Credit .65 CRISIL B/Stable (Reaffirmed) Foreign Letter of Credit 6.00 CRISIL B/Stable (Reaffirmed) Proposed Short Term Bank Loan Facility 3.35 CRISIL A4 (Reaffirmed) The ratings continue to reflect the group's modest scale of operations, its large working capital requirement and weak financial risk profile. These weaknesses are partly offset by the promoters' experience in the timber industry. Analytical Approach For arriving at its ratings, CRISIL has combined the business and financial risk profiles of MKVKNF and its sister concern M.K.V.K. Timbers and Saw Mills (MKVKTSM). This is because the two firms, together referred to as the MKVK group, are under common promoters, in the same line of business, and have fungible cash flows between them. Key Rating Drivers & Detailed Description Weaknesses * Modest scale of operations in a highly fragmented industry: The group's modest scale of operations is reflected in revenue of about INR18 crore in fiscal 2018 in a highly fragmented timber industry and should continue to constrain its profitability. * Large working capital requirement: Operations are working capital intensive marked by gross current assets (GCA) of 288 days as on March 31, 2018, due to high inventory of 188 days and moderate debtors of 89 days. Inventory remains high, owing to high lead time in procurement and seasonal availability of timber. Strength * Promoters' extensive experience in the timber trading business: Benefits from promoters' experience of over three decades in the timber trading business should continue to support the business risk profile. Outlook: Stable CRISIL believes the MKVK group will continue to benefit from its established relationships with customers. The outlook may be revised to 'Positive' if scaling up of operations along with improvement in profitability, leads to better liquidity. The outlook may be revised to 'Negative' if stretch in the working capital cycle or deterioration in margins weakens liquidity. Established in 1987 in Pavoorchatram, Tamil Nadu, MKVKNF, promoted by Mr KP Arunachalarajan and Mr J Thilagam, processes and trades in timber., MKVKTSM trades in timber, cement, asbestos, bamboo, and thermo-mechanically treated bars. TANVIRKUMAR & CO: CRISIL Hikes Rating on INR11.2cr LT Loan to B+ ---------------------------------------------------------------- CRISIL has upgraded its rating on the long-term bank facility of Tanvirkumar & Co (TKC) to 'CRISIL B+/Stable' from 'CRISIL B/Stable', and reaffirmed the rating on the short-term facility at 'CRISIL A4'. Amount Facilities (INR Crore) Ratings ---------- ----------- ------- Post Shipment 53.3 CRISIL A4 (Reaffirmed) Credit Proposed Long Term 11.2 CRISIL B+/Stable (Upgraded Bank Loan Facility from 'CRISIL B/Stable') The upgrade reflects sustained improvement in receivables management over the past two fiscals as seen in reduction of debtors to 156 days as on March 31, 2018, from 194 days as on March 31, 2016, while maintaining the scale of operations and profitability. The ratings continue to reflect large working capital requirement and a leveraged capital structure. These weaknesses are partially offset by the extensive experience of the partners in the diamond industry. Analytical Approach CRISIL has treated unsecured loans from partners as debt as a part of the loans were withdrawn in fiscal 2018, and they carry interest at 10-12% per annum. Key Rating Drivers & Detailed Description Weakness * Large working capital requirement: Gross current assets remained high at 335 days as on March 31, 2018, in spite of some reduction in receivables, driven by large inventory requirement for the jewellery business and high debtors for the diamond polishing business. * Leveraged capital structure: The total outside liabilities to adjusted networth ratio was high at 4.1 times, while the networth was moderate at around Rs.26 crore, as on March 31, 2018. Strength: * Extensive industry experience of the partners: The partners have an experience of over five decades in the diamond industry. This has led to a healthy relationship with customers, which include Tribhovandas Bhimji Zaveri ('CRISIL BBB+/Stable'), C Krishniah Chetty & Sons, and Joyalukkas India Private Limited ('CRISIL A/Stable'). Outlook: Stable CRISIL believes TKC will continue to benefit from the extensive industry experience of its partners and longstanding customer relationships. The outlook may be revised to 'Positive' if there is a substantial and sustained increase in profitability resulting in better cash accrual, along with significant improvement in the working capital cycle. The outlook may be revised to 'Negative' in case of much lower-than-expected cash accrual, considerable deterioration in the capital structure, or a further stretch in the working capital cycle. TKC (formerly, Milan Jewellers) was set up in 1976 by Mr Tanvir Kirtilal Chokshi and Mr Kamlesh Jhaveri. Currently, Mr Milan Choksi, Mr Mihir Jhaveri, Mr Shanay Choksi, and Mr Nailesh Choksi are the key partners. The firm manufactures and trades in polished diamonds and diamond-studded jewellery, through its retail outlet, under the brand Moksh. TEJINDER KAUR: Ind-Ra Maintains BB- LT Rating in Non-Cooperating ---------------------------------------------------------------- India Ratings and Research (Ind-Ra) has maintained Tejinder Kaur's Long-Term Issuer Rating in the non-cooperating category. The issuer did not participate in the rating exercise despite continuous requests and follow-ups by the agency. Therefore, investors and other users are advised to take appropriate caution while using the rating. The rating will continue to appear as 'IND BB- (ISSUER NOT COOPERATING)' on the agency's website. The instrument-wise rating actions are: -- INR13.9 mil. Fund-based limit maintained in Non-Cooperating Category with IND BB- (ISSUER NOT COOPERATING) rating; -- INR1.0 mil. Non-fund-based limits maintained in Non- Cooperating Category with IND A4+ (ISSUER NOT COOPERATING) rating; and -- INR40.38 mil. Term loans maintained in Non-Cooperating Category with IND BB- (ISSUER NOT COOPERATING) rating. Note: ISSUER NOT COOPERATING: The ratings were last reviewed on September 27, 2016. Ind-Ra is unable to provide an update, as the agency does not have adequate information to review the ratings. COMPANY PROFILE Tejinder Kaur is a partnership firm that provides LPG transportation services to major oil companies. UNNATI WRITING: CRISIL Withdraws 'B' Rating on INR10cr Loans ------------------------------------------------------------ CRISIL has withdrawn its ratings on the bank facilities of Unnati Writing Products Private Limited (Unnati) on the request of the company and receipt of a no objection certificate from its bank. The rating action is in line with CRISIL's policy on withdrawal of its ratings on bank loans. Amount Facilities (INR Crore) Ratings ---------- ----------- ------- Cash Credit 8 CRISIL B/Stable (ISSUER NOT COOPERATING; Rating Withdrawn) Proposed Long Term 2 CRISIL B/Stable (ISSUER NOT Bank Loan Facility COOPERATING; Rating Withdrawn) CRISIL has been consistently following up with Unnati for obtaining information through letters and emails dated March 28, 2018, April 10, 2018 and April 16, 2018, among others, apart from telephonic communication. However, the issuer has remained non cooperative. 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 they are arrived at without any management interaction and are 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 UNNATI. This restricts CRISIL's ability to take a forward UNNATI is consistent with 'Scenario 1' outlined in the 'Framework for Assessing Consistency of Information with CRISIL BB rating category or lower. Based on the last available information, the rating on bank facilities of UNNATI continues to be 'CRISIL B/Stable Issuer Not Cooperating'. CRISIL has withdrawn its ratings on the bank facilities of UNNATI on the request of the company and receipt of a no objection certificate from its bank. The rating action is in line with CRISIL's policy on withdrawal of its ratings on bank loans. Unnati was established as a partnership firm in 2001, by Mr Sudarshan Gupta, Mr Suranjan Gupta and Mr Raj Kumar Goel, and reconstituted as a private limited company in 2009. The company manufactures ball pens, fountain pens, roller pens and gel pens. The price range of the products varies from INR1.75 to INR20.0. VEDIKA AGRO: CRISIL Hikes Rating on INR10cr Loans to B+ ------------------------------------------------------- CRISIL has upgraded its rating on the long-term bank facilities of Vedika Agro Industries (VAI) to 'CRISIL B+/Stable' from 'CRISIL B/Stable'. Amount Facilities (INR Crore) Ratings ---------- ----------- ------- Cash Credit 5 CRISIL B+/Stable (Upgraded from 'CRISIL B/Stable') Long Term Loan 3.75 CRISIL B+/Stable (Upgraded from 'CRISIL B/Stable') Proposed Working Capital Facility 1.25 CRISIL B+/Stable (Upgraded from 'CRISIL B/Stable') The upgrade reflects improvement in VAI's business and financial risk profiles. Revenue grew 120% year-on-year, to INR22.66 crore in fiscal 2018 from INR10.31 crore, and further expected to clock INR26.06 crore by fiscal 2019. The networth has improved to INR4.23 crore as on March 31, 2018, from INR0.58 crore as on March 31, 2016 resulting improvement in financial risk profile of the company. The rating continues to reflect VAI's improving, but modest, scale of operations, low profitability, and average financial risk profile. These weaknesses are partially offset by the extensive experience of the proprietor and moderate working capital requirement. Key Rating Drivers & Detailed Description Weaknesses * Improving, but modest, scale of operations and low operating margin: Despite steady growth over the past four fiscals, scale continues to be modest due to intense competition in xxx industry and small capacities. Operating margin was modest at 6.5% in fiscal 2018 due to limited value addition in the end product. * Average financial risk profile: Financial risk profile, although strengthened by the financial assistance provided by the proprietor, remains average: gearing was 1.96 times as on March 31, 2018. Debt protection metrics were comfortable, with interest coverage and net cash accrual to total debt ratios of 2.1 times and 0.08 time, respectively, in fiscal 2018. Strengths * Proprietor's extensive experience in the poultry business and established relationship with key client: Benefits from the proprietor's experience of over two decades, and established relationship with SKM EGG Products Exports (India) Ltd should continue to support business risk profile. * Moderate working capital requirement: Gross current assets were 105 days as on March 31, 2018 (163 days a year before), aided by inventory of around 55 days. Credit of only 30-45 days is extended to customers. Working capital requirement is partly met by supplier credit, leading to moderate reliance on bank debt which is utilised at 100 percent. Outlook: Stable CRISIL believes VAI will continue to benefit from the extensive experience of its proprietor. The outlook may be revised to 'Positive' if significant increase in revenue, and further improvement in working capital cycle strengthen credit metrics. The outlook may be revised to 'Negative' if lower-than-expected accrual, stretch in working capital cycle, or any debt-funded capital expenditure weakens liquidity. VAI was set up in 2011 by Mr Uday Jankar. It processes chana to chana dal, and then to flour. The manufacturing unit is in Ambegaon (Maharashtra), the capacity of which is 15 tonne per day. ================= S I N G A P O R E ================= AVATION PLC: S&P Affirms 'B+' Long-Term ICR, Outlook Positive ------------------------------------------------------------- S&P Global Ratings affirmed its 'B+' long-term issuer credit rating on Avation PLC, a Singapore-based aircraft leasing company. The outlook remains positive. S&P said, "At the same time, we raised the long-term issue rating on the senior unsecured notes to 'B+' from 'B' and removed the rating from CreditWatch where it was placed with positive implications. Avation Capital S.A. issued these bonds under the medium-term notes (MTN) program that Avation guarantees. The upgrade is driven by a US$50 million addition to the existing US$300 million issue and repayment of US$49 million of senior secured debt. We therefore evaluate the recovery rating on the notes at '4', from '5' previously, because we expect more value to flow to the unsecured lenders in the event of a default. "We affirmed the issuer credit rating because we do not view the transaction as significantly changing the credit risk for Avation. The issuance is financial in nature and does not meaningfully affect our view on Avation's underlying business model and operational risks. "We view the transaction as slightly positive because it will provide additional financial flexibility that the company can use to grow its fleet of aircraft. The transaction is leverage neutral and does not alter Avation's credit metrics enough to affect the rating. We also view as positive the company's proactive approach to lengthening the debt maturity profile and adding to undrawn bank line availability. "The positive outlook reflects our expectation that Avation will expand its fleet and reduce its customer concentration in the next 12-24 months. We also anticipate the company's financial strength will be at least stable, given its growing cash flows are likely to cover higher debt incurred for new planes. "Avation's capital structure reflects the company's aggressive growth and the associated high leverage. Given the company's fleet expansion plan, we expect its capital expenditure to remain high at US$175 million-US$225 million in fiscal 2019, and US$125 million-US$175 million in fiscal 2020. We project Avation's debt to increase to US$900 million-US$950 million in fiscal 2019. "The positive outlook reflects our expectation that Avation will expand its fleet and reduce earnings concentration from its top three customers over the next 12-18 months. We anticipate the company will maintain good profitability and moderately increase leverage, with EBIT interest coverage of about 1.6x and a ratio of FFO to debt of 7%-9% over the period. "We may revise the outlook to stable if Avation fails to meaningfully broaden its asset base. This could happen if the company's fleet mix remains concentrated on turbo-prop aircraft, or if the new planes on order are mainly placed with the largest customers." The EBIT interest coverage deteriorating to below 1.5x could also trigger an outlook revision. S&P would upgrade Avation if the company continues to grow and diversify its operations. S&P would also expect Avation to maintain a consistent financial policy, so that its EBIT interest coverage remains above 1.5x and FFO-to-debt ratio stays above 7%. SWISSCO HOLDINGS: Judicial Management Extended Until March 30 ------------------------------------------------------------- The Strait Times reports that the Singapore High Court has granted the judicial managers of Swissco Holdings and its subsidiary extensions of time to carry out their tasks. The period of judicial management of Swissco Offshore has been extended by six months to July 31, 2019, from Jan. 31, 2019, according to the Strait Times. The report says the judicial managers of Swissco and the subsidiary will have until March 30, 2019, from the earlier deadline of Nov. 15, 2018, to submit their proposals for the offshore support vessel companies. The deadline for creditors' meetings to be held has also been pushed to April 14, 2019, from Nov. 30, 2018, the report adds. About Swissco Holdings Swissco Holdings Limited (SGX:ADP), along with its subsidiaries -- http://swissco.net/html/index.php-- is a Singapore-based integrated oil and gas service provider. The Company provides drilling rigs, accommodation jackups and vessel chartering services for the oil and gas industry. The Company's segments are Drilling, which includes drilling rig chartering; Offshore support vessels (OSV), which includes vessel chartering (such as sale of out-port-limit services), ship repair and maintenance services, maritime related services (such as sale of vessels) and OSV related investment activities; Service assets, which includes accommodation and service rig chartering, and Others segment, which includes corporate activities. Its OSV segment owns and operates a fleet of over 40 offshore support vessels that provide a range of offshore chartering services for the marine, offshore oil and gas, and civil construction industries. Its subsidiaries include Swissco Energy Services Pte Ltd, Swissco Offshore (Pte) Ltd (SOPL) and Seawell Drilling Pte Ltd. Swissco and SOPL entered into judicial management in November 2016 after the listed holding company slipped into a US$296 million quarterly loss on booking massive impairments. A Singapore court in April 2017 approved the application made by Swissco to be placed under judicial management. In November 2017, the High Court granted Swissco an extension of its judicial management order to Sept. 18 this year, the Strait Times said. ================ S R I L A N K A ================ SRI LANKA: Risks Debt Default Amid Political Crisis --------------------------------------------------- AFP reports that Sri Lanka's ongoing political crisis could lead the country into an "economic abyss" The news agency relates that Sri Lanka's largest party warned on Nov. 20 that the island could default on its debt as Moody's slashed its credit rating and a bitter power struggle dragged into a fourth week. According to AFP, the South Asian nation has been gripped by an unprecedented political crisis since the president sacked his prime minister on October 26 and appointed former strongman Mahinda Rajapakse in his place. Ranil Wickremesinghe, the ousted premier and leader of the United National Party -- the largest single party in parliament -- refused to step down, declaring his sacking illegal, AFP says. AFP relates that President Maithripala Sirisena then dissolved parliament and called snap elections for January 5 -- a decision later suspended by the Supreme Court. The parliament, restored by court order, voted twice to topple Rajapakse last week but he has also refused to step down, leaving Sri Lanka without a government since November 15, according to AFP. AFP adds that Mangala Samaraweera, a member of Wickremesinghe's party who served as finance minister until the chaos broke out, said he was worried the crisis could lead the country into an "economic abyss". "If we don't have a budget approved unveiled in the next few weeks, the government will not be able to spend any money from January 1, 2019," he told reporters in Colombo, AFP relays. According to AFP, international ratings agency Moody said its decision to downgrade Sri Lanka's credit rating from B1 to B2 reflected external and internal issues, which were "exacerbated most recently by a political crisis which seems likely to have a lasting impact on policy even if ostensibly resolved quickly." A credit downgrade means Sri Lanka would have to pay more by way of interest on its foreign borrowings, because of a greater risk of default, the report notes. AFP says the political unrest also saw the International Monetary Fund (IMF) suspend a tranche of a $1.5-billion bailout loan agreed to in 2016. Samaraweera said there was a serious risk of the country defaulting on a $1-billion sovereign bond that matures on January 10, AFP relays. "We are now in uncharted territory," Samaraweera, as cited by AFP, said. "We have never been in a situation where we were unable to meet our foreign debt." ********* Tuesday's edition of the TCR-AP delivers a list of indicative prices for bond issues that reportedly trade well below par. Prices are obtained by TCR-AP editors from a variety of outside sources during the prior week we think are reliable. Those sources may not, however, be complete or accurate. The Tuesday Bond Pricing table is compiled on the Friday prior to publication. Prices reported are not intended to reflect actual trades. Prices for actual trades are probably different. Our objective is to share information, not make markets in publicly traded securities. Nothing in the TCR-AP constitutes an offer or solicitation to buy or sell any security of any kind. It is likely that some entity affiliated with a TCR-AP editor holds some position in the issuers' public debt and equity securities about which we report. 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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. Marites O. Claro, Joy A. Agravante, Rousel Elaine T. Fernandez, Julie Anne L. Toledo, Ivy B. Magdadaro and Peter A. Chapman, Editors. Copyright 2018. 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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