/raid1/www/Hosts/bankrupt/TCRAP

/raid1/www/Hosts/bankrupt/TCRAP_Public/190111.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 Friday, January 11, 2019, Vol. 22, No. 008 Headlines A U S T R A L I A AB IMAGE: Second Creditors' Meeting Set for Jan. 17 BALDWIN DISTILLING: First Creditors' Meeting Set for Jan. 18 BIAS INDUSTRY: First Creditors' Meeting Set for Jan. 21 BORON INVESTMENTS: Second Creditors' Meeting Set for Jan. 17 MAITLAND LEAGUES: In Liquidation; Assets to be Sold NIVEAU PTY: Second Creditors' Meeting Set for Jan. 17 PICTON PRESS: ATO Takes Administrators to Court Over Ruling URBAN COUTURE: First Creditors' Meeting Set for Jan. 21 C H I N A BIOSTAR PHARMACEUTICALS: Common Stock Delisted from Nasdaq HNA GROUP: Hong Kong Office Landlord Sue Over HK$8.3MM Debt RKPF OVERSEAS: S&P Puts BB- Rating to New US Dollar Unsec. Notes SUNAC CHINA: S&P Rates New U.S. Dollar Senior Unsecured Notes 'B' YINGLI GREEN: Amends Supply Agreements with Wacker Chemie AG I N D I A AERCOMFORT PRIVATE: CARE Lowers Rating on INR3.75cr Loan to B+ ALIGARH ROLLER: CRISIL Reaffirms B+ Rating on INR7cr Cash Loan BALAJI AUTO: CARE Assigns 'B' Rating to INR5.50cr LT Loan BALRAM COTEX: CARE Reaffirms B+ Rating on INR6.50cr LT Loan BHAGAWATI DEVELOPMENT: CARE Reaffirms B+ Rating on INR3cr Loan BHAGAWATI INDIA: CARE Lowers Rating on INR15.24cr Loan to BB- BHINMAL CONTRACTORS: CARE Assigns B+ Rating to INR1.50cr Loan BOMMIDALA SREERAM: CRISIL Migrates B Rating from Not Cooperating GADDALA FINANCIAL: CRISIL Reaffirms B Rating on INR10cr Loan GAMA INFRAPROP: Ind-Ra Assigns 'B-' Rating, Outlook Stable HARIOM TRADERS: CARE Raises Rating on INR12cr LT Loan to B+ INDRAYANI SALES: CARE Reaffirms B/A4 Rating on INR15cr Loan JINDAL POLYWEAVES: Ind-Ra Withdraws BB LT Rating, Stable Outlook JODHANI PAPERS: CARE Hikes Rating on INR11.0cr LT Loan to BB KHT AGENCIES: CARE Cuts INR53.06cr Loan Rating to B+, Not Coop. KL VENTURES: CARE Removes D Rating from Not Cooperating K MOHAN: CRISIL Downgrades Rating on INR40cr Loan to D KRUPANIDHI CONST'N: CARE Reaffirms B+ Rating on INR3.5cr Loan M G THREADS: CARE Reaffirms B+ Rating on INR15.70cr LT Loan NARESH SINGHAL: CARE Reaffirms B+ Rating on INR3.25cr LT Loan PATEL CONSTRUCTION: CARE Moves B+ Rating to Not Cooperating PIYUSH ENTERPRISES: CRISIL Reaffirms B+ Rating on INR1cr Loan PRASHANT ENTERPRISES: CRISIL Lowers Rating on INR25cr Loan to B+ RAM COTEX: CARE Reaffirms B+ Rating on INR6.50cr LT Loan RAMCO EXTRUSION: CARE Reaffirms B+ Rating on INR20.35cr Loan REAL VALUE: CARE Maintains B+ Rating in Not Cooperating Category REGALIA JEWELS: CARE Migrates 'B' Rating to Not Cooperating SHREE RAMKRISHNA: CARE Reaffirms B+ Rating on INR9.50cr Loan SOHAM COLD: CARE Reaffirms B+ Rating on INR5.06cr LT Loan TORO PROCESSORS: CARE Migrates D Rating to Not Cooperating ULTIMA SWITCHGEARS: Ind-Ra Affirms BB- LT Rating, Outlook Stable VIKAS TECHNOPLAST: Ind-Ra Lowers Long Term Issuer Rating to 'D' VINAYAK AUTOLINK: CRISIL Hikes Rating on INR12cr Loan to B- P H I L I P P I N E S COUNTRYSIDE COOPERATIVE: Deposit Claims Deadline Set for Jan. 14 S I N G A P O R E COASTAL OIL: At Least 10 Banks Face HK$3 Billion Loss - - - - - ================= A U S T R A L I A ================= AB IMAGE: Second Creditors' Meeting Set for Jan. 17 --------------------------------------------------- A second meeting of creditors in the proceedings of AB Image Distribution Pty Ltd Formerly known as Rectron Electronics has been set for Jan. 17, 2019, at 10:00 a.m. at the offices of Regus Brisbane, at Level 22, 127 Creek Street, in Brisbane, Queensland. 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 Jan. 16, 2019, at 4:00 p.m. Christopher John Baskerville of Jirsch Sutherland was appointed as administrator of AB Image on Dec. 3, 2018. BALDWIN DISTILLING: First Creditors' Meeting Set for Jan. 18 ------------------------------------------------------------ A first meeting of the creditors in the proceedings of Baldwin Distilling Company Pty Ltd will be held on Jan. 18, 2019, at 10:30 a.m. at the offices of Worrells Solvency & Forensic Accountants, at Level 2 AMP Building, 1 Hobart Place, in Canberra City, ACT. Stephen John Hundy of Worrells Solvency was appointed as administrators of Baldwin Distilling on Jan. 8, 2019. BIAS INDUSTRY: First Creditors' Meeting Set for Jan. 21 ------------------------------------------------------- A first meeting of the creditors in the proceedings of Bias Industry Group Pty Ltd, formerly trading as "Building Industry Advisory Group" and "Owner Builders Advisory Service", will be held on Jan. 21, 2019, at 10:30 a.m. at the offices of BRI Ferrier Western Australia, at Unit 3, 99-101 Francis Street, in Northbirde, WA. Giovanni Maurizio Carrello of BRI Ferrier was appointed as administrators of Bias Industry on Jan. 10, 2019. BORON INVESTMENTS: Second Creditors' Meeting Set for Jan. 17 ------------------------------------------------------------ A second meeting of creditors in the proceedings of Boron Investments Pty Ltd has been set for Jan. 17, 2019, at 10:00 a.m. at Pelican Room, Level 24, Allendale Square, 77 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 Jan. 16, 2019, at 4:00 p.m. Mathieu Tribut of GTS Advisory was appointed as administrator of Boron Investments on Dec. 3, 2018. MAITLAND LEAGUES: In Liquidation; Assets to be Sold --------------------------------------------------- Donna Sharpe at The Maitland Mercury reports that nine of Maitland Leagues Club's 124 creditors have met and voted to terminate the Deed of Company Arrangement they made with the club and sadly place the Hunter institution into liquidation. The meeting, held on January 3 appointed insolvency firm Shaw Gidley's Jeff Shute -- jshute@shawgidley.com.au -- as liquidator, the report says. According to the report, Mr. Shute will now release the club's assets and distribute the funds to the business's creditors. All assets of the club, including the building, poker machine entitlements, equipment and furniture will be sold to pay out creditor claims. In terms of a potential sale, Mr. Shute said: "We are currently liaising with several parties who have expressed interest in acquiring the building," the report relays. Maitland Leagues Club went into voluntary administration early last year owing creditors, including St George Bank, AUD4.5 million, the Maitland Mercury discloses. Its Bulwer Street premises has now been listed for sale under private treaty, the report notes. If sold for the AUD2.3 million it has been listed for, employees and St George Bank will be paid in full, but other creditors will only receive between 39 to 52 cents for every dollar owed, according to the report. After the announcement the club had gone into administration, Club Maitland City bankrolled it with a AUD200,000 loan. Maitland City CEO Ian Martin said late last year his club was still owed that money, the report relates. In March last year, Maitland City signed a 30-year-deal, worth tens of thousands of dollars annually, to guarantee Maitland rugby league club, The Pickers', long-term future which came with the blessing of the leagues club -- The Pickers' traditional backer, the report recalls. The Maitland Mercury says the leagues club was unable to trade its way out of its deep financial hole, and was unable to secure additional funding from Maitland City to enable ongoing trade to achieve amalgamation. This left the club's board with no alternative but to close its doors in December, the report says. "The club's assets are insufficient to pay creditors' in full as required by the Deed of Company Arrangement," the report quotes Mr. Shute as saying. "It appears the club is unable to meet certain pre-conditions associated with the amalgamation. "Unfortunately, it appears that the amalgamation will no longer proceed," he said. NIVEAU PTY: Second Creditors' Meeting Set for Jan. 17 ----------------------------------------------------- A second meeting of creditors in the proceedings of Niveau Pty Ltd has been set for Jan. 17, 2019, at 11:30 a.m. at Pelican Room, Level 24 Allendale Square, 77 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 Jan. 16, 2019, at 4:00 p.m. Mathieu Tribut of GTS Advisory was appointed as administrator of Niveau Pty on Dec. 3, 2018. PICTON PRESS: ATO Takes Administrators to Court Over Ruling ----------------------------------------------------------- Wayne Robinson at Print21.com.au reports that the Australian Tax Office is lodging further legal action against the directors of debt-ridden Picton Press, taking them back to court, and this time has named the company's administrators in its lawsuit, as it seeks to overturn the Dec. 18 court ruling, which dismissed its winding up order. Print21.com.au says that in a separate development long-time well respected operations manager Murray Scott has joined the exodus out of the company, with two pre-press operators also just leaving. Print21.com.au relates that the ATO -- which is owed AUD1.3 million by Picton -- lodged an application to the Federal Court on Dec. 21, three days after the ruling that dismissed its original winding up order. For the first time, the ATO named administrators Jeremy Nipps and Clifford Rocke from Cor Cordis in the lawsuit, as well as Picton directors Garry Kennedy and Dennis Hague, and Picton Press itself, as the defendants. No date has yet been set for the court hearing, the report states. According to Print21.com.au, administrator Jeremy Nipps steered the business into a Deed of Company Arrangement (DOCA), thanks to what creditors at the meeting said was a highly controversial vote he managed. Almost all unsecured creditors -- including the ATO -- voted against, but all employees voted for, with Mr. Nipps then declaring the vote deadlocked, before casting his vote in favor to get the DOCA over the line. Print21.com.au notes that the DOCA will enable the company to shed between 98 and 99 per cent of its AUD3.6 million unsecured debt, with unsecured creditors -- including the ATO -- getting between just 1c and 2c in the dollar. In the ATO's case, this translates into somewhere between just AUD13,000 and AUD26,000 of its AUD1.3 million, the report says. Cor Cordis received AUD356,000 for its six-month stint as administrator, from May 22 to November 29, a period which saw Picton gain receipts in of AUD3.12 million, while payments out were AUD2.95 million, Print21.com.au discloses. Print21.com.au says the Dec. 18 court case came after several adjournments. The court ruled against the ATO, citing the approved DOCA, but in an interesting move it awarded the ATO's costs against Picton. Print21.com.au relates that the DOCA has caused uproar in the WA printing community, as they point out that it effectively means that while they have all been writing cheques to the tax office for 100c in the dollar, and paying their paper bills in full for the past four years, and pricing their jobs accordingly, Picton has not, and now does not have to, having shed itself of more than AUD3.5 million of its AUD3.6 million debt, which is owed to 72 unsecured creditors. According to the report, administrator Jeremy Nipps said the DOCA is a legitimate tool to help a struggling business move forward. However, one local print identity told Print21, "If this is the outcome then the ATO's new anti-phoenixing unit is a gigantic waste of time and money. It beggars belief." Jeremy Joseph Nipps and Clifford Stuart Rocke of Cor Cordis were appointed as administrators of Picton Press on May 22, 2018. Picton put itself into voluntary administration in May when the ATO initiated its winding up order as Picton failed to pay its AUD1.3 million tax bill. As well as the unsecured debts Picton has around AUD5.5 million in loans from banks, secured against various properties, the report discloses. URBAN COUTURE: First Creditors' Meeting Set for Jan. 21 ------------------------------------------------------- A first meeting of the creditors in the proceedings of Urban Couture Pty Ltd will be held on Jan. 21, 2019, at 10:00 a.m. at the offices of O'Brien Palmer, at Level 9, 66 Clarence Street, in Sydney, NSW. Daniel John Frisken and Liam Bailey of O'Brien Palmer were appointed as administrators of Urban Couture on Jan. 9, 2019. ========= C H I N A ========= BIOSTAR PHARMACEUTICALS: Common Stock Delisted from Nasdaq ---------------------------------------------------------- The Nasdaq Stock Market LLC has filed a Form 25 with the Securities and Exchange Commission notifying the removal from listing or registration of Biostar Pharmaceuticals, Inc.'s common stock from the Exchange. About Biostar Pharmaceuticals Based in Xianyang, China, Biostar Pharmaceuticals, Inc., through its wholly owned subsidiary and controlled affiliate in China -- http://www.biostarpharmaceuticals.com/-- develops, manufactures, and markets pharmaceutical and health supplement products for a variety of diseases and conditions. Biostar incurred a net loss of $5.69 million in 2016 and a net loss of $25.11 million in 2015. As of Sept. 30, 2017, the Company had $41.42 million in total assets, $5.27 million in total current liabilities, and $36.14 million in total stockholders' equity. Mazars CPA Limited, Certified Public Accountants, in Hong Kong, issued a "going concern" qualification in its report on the consolidated financial statements for the year ended Dec. 31, 2016, stating that the Company had experienced a substantial decrease in sales volume which resulted a net loss for the year ended Dec. 31, 2016. Also, part of the Company's buildings and land use rights are subject to litigation between an independent third party and the Company's chief executive officer, and the title of these buildings and land use rights has been seized by the PRC Courts so that the Company cannot be sold without the Court's permission. In addition, the Company already violated its financial covenants included in its short-term bank loans. These conditions raise substantial doubt about the Company's ability to continue as a going concern. HNA GROUP: Hong Kong Office Landlord Sue Over HK$8.3MM Debt ----------------------------------------------------------- The South China Morning Post reports that embattled HNA Group is being sued by its office landlord in Hong Kong's main business district over a debt of about HK$$8.3 million (US$1.06 million), according to a writ filed with the city's High Court. The unpaid money is the costs allegedly incurred by HNA when it surrendered five floors of office space at Three Exchange Square, in Central, as part of a cost-cutting exercise, two sources close to the matter said, SCMP relays. Mulberry Land, a wholly owned subsidiary of Hongkong Land, claims the debt-laden Chinese conglomerate owes two instalments - one worth HK$3.65 million which had been due on December 1, 2018 and another of HK$4.65 million due on January 1 this year, according to the writ cited by SCMP. According to the report, HNA said in a statement on Jan. 9 that "the relevant money has been paid in full" and that the delay was due to a "liquidity problem". The company did not elaborate. SCMP notes that the group, whose interests span aviation to finance, gave up five of eight floors it rented at Three Exchange Square last year to cut its borrowing costs. The spaces were taken up by China Merchants Bank, according to property agents. Costs incurred in finding replacement tenants must be borne by the "defaulting tenant", the agents said, the report relays. Such costs may include agency fees and legal fees, subject to the agreement between landlord and tenant. Mainland Chinese companies have been under financial pressure recently, and their demand for office space has slowed, the report notes citing international property consultant Savills. The report says a downturn in business sentiment and the tightening of liquidity in China have prompted commercial landlords in Hong Kong to double or triple the money tenants must put down as a deposit. To ease its crippling debt load, HNA Group has sold billions of dollars worth of assets in the last year or so. It was formerly one of China's most prolific offshore asset buyers. Its divestments continued this week with the sale of 70 per cent of its space in a Shanghai office building, Pufa Tower, for CNY2.75 billion, and an office building at 850 Third Ave in Manhattan for an undisclosed price, SCMP adds. 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 related that HNA Group defaulted on a CNY300 million (US$44 million) loan raised through Hunan Trust. 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 $18 billion in asset sales by HNA this year that have done little to address its ability to meet its domestic debts, the FT noted. RKPF OVERSEAS: S&P Puts BB- Rating to New US Dollar Unsec. Notes ---------------------------------------------------------------- S&P Global Ratings assigned its 'BB-' long-term issue rating to the U.S.-dollar-denominated senior unsecured notes that RKPF Overseas 2019 (B) Ltd. proposes to issue. Road King Infrastructure Ltd. (BB-/Stable/--) guarantees the notes. The China-focused developer with a toll-road portfolio will use the proceeds to refinance its existing debt. The issue rating is subject to its review of the final issuance documentation. S&P rates RKI's guaranteed senior unsecured notes the same as the issuer credit rating, given limited subordination risk in the company's capital structure. As of Dec. 31, 2017, RKI's capital structure consisted of Hong Kong dollar (HK$) 6.9 billion in secured debt, HK$15.0 billion in unsecured debt at the parent level, and HK$5.9 billion unsecured debt issued or guaranteed by the company's operating subsidiaries. S&P considers the company's priority debt ratio to be below 50%. RKI will use the net proceeds to purchase part of its US$450 million guaranteed senior unsecured notes due August 2019 by tender. The company has another Chinese renminbi (RMB) 1.5 billion in domestic corporate bonds maturing in the second half of 2019. S&P expects RKI to maintain prudent financial management and keep leverage largely stable, with the ratio of debt to EBITDA at 4.3x-4.6x in 2018 and 2019, up slightly from 4.2x in 2017. RKI's contracted sales rose to RMB32.1 billion in 2018, 31% higher than the same period in 2017. This exceeded S&P's base- case projection, due to strong growth in the second half. However, RKI's market position in China property development remains weak compared with other similar rated peers', owning to the company's small scale, weak brand recognition, and geographical concentration in the Yangtze River Delta. S&P said, "The stable outlook on the issuer credit rating on RKI reflects our expectation that the company will moderately increase its property sales over the next 12 months. We also anticipate that the company will maintain its strong profit margin over this period due to its steady execution of property development and stable income from its toll-road business." SUNAC CHINA: S&P Rates New U.S. Dollar Senior Unsecured Notes 'B' ----------------------------------------------------------------- S&P Global Ratings assigned its 'B' long-term issue rating to a proposed issue of U.S. dollar-denominated senior unsecured notes by Sunac China Holdings Ltd. (Sunac: B+/Positive/--). The China- based developer intends to use the net proceeds primarily to refinance its existing debt. S&P said, "We rate the notes one notch below the issuer credit rating on Sunac to reflect structural subordination risk. The issue rating is subject to our review of the final issuance documentation. "We do not expect the new issuance to have any significant impact on Sunac's credit profile. In our view, the company will maintain strong sales execution and sustainable profitability while continuing to improve its financial leverage through more controlled spending. This is reflected in the positive rating outlook on the company. We could raise the rating if Sunac can demonstrate a more consistent track record of financial prudence and improve its proportionally consolidated debt-to-EBITDA ratio to below 5.0x on a sustained basis." YINGLI GREEN: Amends Supply Agreements with Wacker Chemie AG ------------------------------------------------------------ Yingli Green Energy Holding Company Limited has entered into an amendment to all existing supply agreements between the Company and Wacker Chemie AG of Germany. Under the terms of the Amendment, several operating entities of the Company in China will continue to purchase polysilicon from Wacker from 2019 to 2028 with quantities and price specified in the Amendment and Wacker will suspend the damage claims against the Company arising from the Pre-Amendment Agreements. In addition, Wacker is entitled to retain the forfeited prepayments that were paid by the Company to Wacker and kept by Wacker under the Pre-Amendment Agreements. About Yingli Green Energy Yingli Green Energy Holding Company Limited (NYSE: YGE), known as "Yingli Solar", -- http://www.yinglisolar.com/-- is a solar panel manufacturer. Yingli Green Energy's manufacturing covers the photovoltaic value chain from ingot casting and wafering through solar cell production and solar panel assembly. Headquartered in Baoding, China, Yingli Green Energy has more than 20 regional subsidiaries and branch offices and has distributed more than 20 GW solar panels to customers worldwide. Yingli Green reported a net loss attributable to the Company of RMB3.31 billion for the year ended Dec. 31, 2017, compared to a net loss attributable to the Company of RMB2.09 billion for the year ended Dec. 31, 2016. As of Dec. 31, 2017, Yingli Green had RMB10.34 billion in total assets, RMB20.83 billion in total liabilities and a total shareholders' deficit of RMB10.49 billion. The report from the Company's independent accounting firm PricewaterhouseCoopers Zhong Tian LLP on the consolidated financial statements for the year ended Dec. 31, 2017, includes an explanatory paragraph stating that facts and circumstances including accumulated and recurring losses from operations, negative working capital, cash outflows from operating activities, and uncertainties regarding the repayment of financing obligations raise substantial doubt about the Company's ability to continue as a going concern. ========= I N D I A ========= AERCOMFORT PRIVATE: CARE Lowers Rating on INR3.75cr Loan to B+ -------------------------------------------------------------- CARE Ratings revised the ratings on certain bank facilities of Aercomfort Private Limited (APL), as: Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long-term Bank 3.75 CARE B+; Stable Issuer Not Facilities Cooperating; Revised from CARE BB-; Stable on the basis of best available information Short-term Bank 5.25 CARE A4; Issuer Not Facilities Cooperating; on the basis of best available information Detailed Rationale & Key Rating Drivers CARE has been seeking information from APL to monitor the rating(s) vide e-mail communications/letters December 4, 2018, November 12, 2018 & 0ctocber 25, 2018 and numerous phone calls. However, despite CARE's repeated requests, the company has not provided the requisite information for monitoring the ratings. In line with the extant SEBI guidelines, CARE has reviewed the rating on the basis of the best available information which however, in CARE's opinion is not sufficient to arrive at a fair rating. The rating on Aercomfort Private Limited (APL) facilities will now be denoted as CARE B+ /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. The long-term rating has been revised by taking into account non- availability of information and no due-diligence conducted due to non-cooperation by Aercomfort Private Limited (APL) with CARE'S efforts to undertake a review of the rating outstanding. CARE views information availability risk as a key factor in its assessment of credit risk. The ratings of APL are continue to be constrained by its small scale of operations with low net worth base and weak coverage indicators. The ratings are further continue to be constrained by highly competitive industry and risks associated with tender- based orders. The ratings, however, draw comfort from experienced management along with reputed customer base, moderate profitability margins, capital structure and moderate operating cycle. Detailed description of the key rating drivers Credit Risk Assessment Key Rating Weakness Small scale of operations with low net worth base: The scale of operations has remained small marked by a total operating income and gross cash accruals of INR24.11 crore and INR0.60 crore respectively for FY17 (FY refers to the period April 1 to March 31). Further, the company's net worth base was relatively low at INR6.71 crore as on March 31, 2017. The small scale of operations and net worth base in a competitive industry limits the bidding capability and pricing power. Further, the small scale limits the company's financial flexibility in times of stress and deprives it from scale benefits. Further, during the current year i.e. 7MFY18 (refers to April 1 to October 31), the company has achieved a total operating income of INR16.00 crore. Weak Coverage indicators: The coverage indicators of the company stood weak marked by interest coverage ratio and total debt to gross cash accruals stood weak of 1.55x and 15.30x for FY17 owning to high dependence on external funds in form of bank borrowings and unsecured borrowings and lower level of gross cash accruals. Highly competitive industry and risks associated with tender- based orders: APL faces direct competition from various organized and unorganized players in the market. There are number of small and regional players catering to the same market which has limited the bargaining power of the company and therefore has a bearing on its margins. Furthermore, the company majorly undertakes government projects, which are awarded through the tender-based system. The growth of the business depends on its ability to successfully bid for the tenders and emerge as the lowest bidder. This apart, any changes in the government policy or government spending on projects are likely to affect the revenues and profits of the company. Key Rating Strengths Established presence with extensive experience of the promoter in the industry: Mr. Vijay Kumar Gupta in 1968 has nearly 4 decades of experience in service industry. Mr. Mayank Gupta; another director is an engineer by qualification. He has more than a decade of experience in the industry through his association with the company. Both the directors collectively look after the overall operations of the company. APL has been operational for around half a decade and has been able to establish relationship with its suppliers and customers. Moderate profitability margins and comfortable capital structure: The company majorly undertakes government projects, which are awarded through the tender-based system. Therefore, the margins largely depend on nature of contract executed. The profitability of the company stood at moderate levels marked by PBILDT and PAT margins at around 10% and 2% respectively for the last 3 years i.e. FY15-FY17 (FY refers to April 01 to March 31). As on March 31, 2017, the capital structure of the company stood moderate marked by debt equity ratio and overall gearing ratio of 0.80x and 1.37x. Moderate operating cycle: The company's customers are companies like government bodies/departments which have longer payment periods attributable to varying inspection and approval timelines. The company raises bill on percent completion basis and receives nearly 80%-90% of the payment within 60-90 days and remaining is kept as retention money which is normally released after the project completion. The company has to keep inventory at different sites for smooth execution of contracts which results in average inventory days of around 52 days. The moderate working capital cycle is emanates from collection and inventory holding period of 89 days and 52 days, respectively, and adequate average payable period of 67 days in FY17. Delhi based Aercomfort Private Limited (APL) was incorporated in September, 1998. The company has succeeded an erstwhile proprietary concern established in 1968. The company provides turnkey solutions for heating, ventilation, and air conditioning (HVAC) projects for Central public works department, Airport authority of India etc. ALIGARH ROLLER: CRISIL Reaffirms B+ Rating on INR7cr Cash Loan -------------------------------------------------------------- CRISIL has reaffirmed its 'CRISIL B+/Stable' rating on the long- term bank facility of Aligarh Roller Flour Mills Private Limited (ARFM). Amount Facilities (INR Crore) Ratings ---------- ----------- ------- Cash Credit 7 CRISIL B+/Stable (Reaffirmed) The rating continues to reflect modest scale of ARFM's operations in the intensely competitive flour mill industry, low interest coverage ratio, and a small networth. These weaknesses are partially offset by the extensive experience of the promoters and a comfortable total outside liabilities to tangible networth (TOL/TNW) ratio. Analytical Approach Unsecured loans (outstanding at INR1.02 crore as on March 31, 2018) extended to ARFM by the promoters have been treated as neither debt nor equity. That is because these loans are expected to remain in the business over the medium term and are subordinated to bank debt. Key Rating Drivers & Detailed Description Weaknesses * Modest scale of operations amid intense competition: Intense competition may continue to constrain scalability, pricing power, and profitability. Hence, revenue and operating margin were modest at INR47.73 crore and 1.59%, respectively, in fiscal 2018. * Low interest coverage and small networth: The interest coverage ratio was average at 1.08 times in fiscal 2018, while networth was modest at INR5.21 crore as on March 31, 2018. Strengths * Extensive experience of the promoters: Benefits from the promoters' experience of nearly three decades, their strong understanding of local market dynamics, and healthy relations with customers and suppliers should continue to support the business. * Comfortable TOL/TNW ratio: The ratio may moderate to 1.20 times as on March 31, 2019, from 1.49 times as on March 31, 2018, and should remain stable over the medium term, in the absence of any term debt. Outlook: Stable CRISIL believes ARFM will continue to benefit from the extensive experience of the promoters. The outlook may be revised to 'Positive' if a substantial and sustainable increase in cash accrual or a sizeable fund infusion strengthens the financial risk profile. Conversely, the outlook may be revised to 'Negative' if a steep decline in profitability or any large, debt-funded capital expenditure (capex) weakens the financial risk profile and liquidity. Liquidity Liquidity is likely to remain adequate over the medium term. Cash and cash equivalents was INR0.21 crore as on March 31, 2018. Cash accrual is projected at just INR0.33-0.36 crore per annum over the medium term, against yearly maturing debt of INR0.03 crore. Thus, bank limit utilisation has been high, averaging 99% over the 12 months through October 2018. With no large capex plans over the medium term, cash accrual along with cash and cash equivalents may be able to meet maturing debt and the working capital requirement. ARFM, incorporated in 1990, produces atta, maida, sooji, and wheat bran. The Aligarh (Uttar Pradesh)-based company has capacity of 200 tonne per day, and operates at 50-55% of capacity. BALAJI AUTO: CARE Assigns 'B' Rating to INR5.50cr LT Loan --------------------------------------------------------- CARE Ratings has assigned rating to the bank facilities of Balaji Auto Pack (Balaji), as: Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long-Term Bank Facilities 5.50 CARE B; Stable Assigned The rating assigned to the bank facilities of Balaji is constrained on account of inherent implementation and stabilization risk associated with its on-going greenfield manufacturing project, susceptibility of profit margins to volatility in raw material prices, high competition in packaging industry along partnership nature of constitution. The rating, however, derives strength from Balaji's experienced promoters, location advantage, and its diversified product portfolio and stable outlook of paper industry. Balaji's ability to complete the greenfield project within envisaged time and cost parameters and achievement of envisaged sales and profitability while managing its working capital efficiently post completion of project are the key rating sensitivity. Detailed description of the key rating drivers Key Rating Weaknesses Risk associated with implementation and stabilization of green field project: Balaji is implementing greenfield project of manufacturing of corrugated boxes at a total envisaged project cost of INR7.55 crore crore with project debt/equity mix of 2.78x. Balaji has incurred 67.55% of the total project cost till December 24, 2018. With balance cost yet to be incurred, timely completion and stabilization of operations will be crucial. Partnership nature of constitution: Being a partnership firm, Balaji is exposed to inherent risk of partners' capital being withdrawn at time of personal contingency, and firm being dissolved upon the death/retirement/insolvency of partners which may affect financial flexibility of the firm. High competition in packaging industry as well as volatility in prices of raw materials: The Indian packaging industry is a combination of organized large Indian and International companies and the unorganized small and medium local companies. Balaji operates in a competitive segment of the packaging industry which has relatively lower profitability due to highly fragmented industry, high raw material prices, low entry barriers, presence of large number of unorganized players with capacity additions by existing players as well as new entrants. Kraft paper is the raw material which is driven by demand and supply scenario led to volatility in the prices. Key Rating Strengths Experienced promoters: Balaji was formed by five promoters namely Mr. Hardikbhai Durlabhjibhai Bhalodiya, Mrs. Anjanaben Hardikbhai Bhalodiya, Mrs. Axitaben Hiteshbhai Bhalodiya, Mr. Hirenbhai Prabhubhai Marvaniya and Mr. Kishanbhai Narbherambhai Panchotiya. Mr. Hardik Bhalodiya and Mr. Hiren Marvaniya hold total experience of more than a decade in packing and paper industry through other entities. Location advantage: Balaji's manufacturing facilities are located in Morbi, Gujarat. Balaji's manufacturing facility is strategically located in ceramic zone with large number of manufacturing companies thereby would lead to ready market available for Balaji's products. The place enjoys good road & rail connectivity leading to better lead time and facilitating delivery of finished products in a timely manner. The manufacturing unit is located in the industrial hub which will ensure easy access to customers and suppliers and will provide competitive advantage in terms of lower logistic expenditure (both on the transportation and storage). Diversified product portfolio catering to diversified industries: Balaji will be engaged in manufacturing of corrugated boxes which can be used for packaging for various goods and are supplied to various industries viz. FMCG industry, home appliances industry, pharmaceutical industry etc. Balaji would manufacture various types of boxes which are designed to carry products with different size, weight and shape and caters to various industries. Balaji will manufacture boxes which handles varied needs of end- users from various industries. Thus, catering to diversified user industries would lead to reduction in industry concentration risk. Stable outlook of paper industry: Balaji will be engaged in manufacturing of corrugated boxes of various sizes and strengths with use of kraft paper which finds its application in packaging of various goods. The fortune of Indian paper packaging industry is closely linked with the economic growth as demand of paper for packaging increases with increase in industrial output. While the rising cost of raw material and power cost may impact the profitability of the paper industry in the short-medium term, the outlook for the long term remains stable as the key demand drivers such as increased economic activity, increasing government spending on education, rising population and incomes levels and greater use of paper packaging over plastic packaging. Morbi (Gujarat) based Balaji was formed in December 2018 as a partnership firm by five promoters to undertake a green field project for manufacturing of corrugated boxes. Balaji proposes to establish a manufacturing unit with a proposed installed capacity of 12000 (MTPA) Metric Tonnes Per Annum. The total project cost is envisaged at INR7.55 crore, which is to be funded through term loan of INR3.20 crore, unsecured loan of INR2.35 and balance INR2.00 crore by way of partners' capital. Balaji has incurred INR5.10 crore till December 24, 2018 which was funded through share capital of INR2.34 crore, unsecured loans of INR0.19 crore, and project creditors of INR2.57 crore. The project is envisaged to commence commercial operations from April 2019. BALRAM COTEX: CARE Reaffirms B+ Rating on INR6.50cr LT Loan ----------------------------------------------------------- CARE Ratings reaffirmed ratings on certain bank facilities of Balram Cotex (BAC), as: Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term Bank Facilities 6.50 CARE B+; Stable Reaffirmed Detailed rationale and key rating drivers The rating assigned to the bank facilities of BAC continues to remain constrained on account of its moderate scale of operations and overall financial risk profile marked by thin profit margins, moderately leveraged capital structure, weak debt coverage indicators and working capital intensive nature of its operations during FY18 (refers to the period April 1 to March 31). The rating, further, continues to remain constrained on account of its constitution as a partnership firm, susceptibility of its operating margins to cotton price fluctuations and its presence in a fragmented and seasonal cotton industry with regulatory controls. The rating, however, continues to derive benefits from experienced partners in cotton industry along with location advantage on account of it being located in the cotton-producing belt of Gujarat. The ability of BAC to increase its scale of operations with improvement in profitability and solvency position along with efficient working capital management are the key rating sensitivities. Detailed description of key rating drivers Key Rating Weaknesses Moderate scale of operations along with thin profit margins: The scale of operations as marked by Total operating Income (TOI) of BAC has exhibited a fluctuating trend since the past three years ended FY18. It decreased significantly by 29.08% y-o-y and stood at INR36.92 crore during FY18 as against INR52.05 crore during FY17; albeit it continued to remain moderate. PBILDT margin continued to remain low at 1.72% in FY18 as against 1.14% during FY17. Consequently, PAT margin remained thin at 0.09% during FY18 as against 0.08% during FY17. Moderately leveraged capital structure and weak debt coverage indicators: Capital structure as marked by overall gearing ratio continued to remain moderately leveraged at 2.42 times as on March 31, 2018 as against 2.33 times as on March 31, 2017, owing to an increase in total debt level. Debt coverage indicators continued to remain weak as marked by total debt to gross cash accruals of 74 times as on March 31, 2018 (26.32 times as on March 31, 2017) owing to an increase in total debt level coupled with decrease in the level of gross cash accruals. Further, interest coverage ratio stood low at 1.18 times during FY18 (1.75 times during FY17). Liquidity Analysis: Working capital intensive nature of operations: The operations remained working capital intensive in nature as indicated by modest current ratio of 1.21 times as on March 31, 2018 as against 1.14 times as on March 31, 2017. Further, BAC's operating cycle elongated to 58 days during FY18 as against 33 days in FY17, while the average utilization of its working capital facilities remained high at around 90% during past 12 months period ended November, 2018. The cash flow from operating activities stood low at INR0.83 crore while the cash and bank balance stood at INR1.30 crore as on March 31, 2018. Partnership nature of its constitution with presence in a highly fragmented and seasonal industry along with regulatory controls: BAC being a partnership firm faces risk of withdrawal of capital by the partners which may affect the overall financial flexibility of the firm. Also, the industry is highly fragmented marked by presence of large number of units operating in cotton ginning business, while cotton being a seasonal crop is dependent upon the vagaries of monsoon. Furthermore, the cotton supply and prices in India are highly regulated by the government through Minimum Support Price (MSP) and export regulations. Susceptibility of operating margin to cotton price fluctuations: The price of raw material i.e. raw cotton is highly volatile in nature and depends upon factors like area under production, yield for the year, international demand supply scenario, export quota decided by government and inventory carry forward of last year which exposes the ginners to price volatility risk. Key Rating Strengths Experienced partners in the cotton industry with location advantage: The key partners of the company have vast experience in the cotton industry and have been involved in cotton ginning business for more than two decades. BAC is based at Kadi region in Gujarat which is one of the largest cotton producing region having benefits derived out of stable power supply, labour, lower logistics expenditure and easy availability and procurement of raw cotton at effective prices. Kadi-Mehsana (Gujarat) based BAC was formed in April 2013 by Patel family, having seven partners. Mr Hasmukhbhai Motilal Patel, having experience of more than two decades in the similar line of business, looks after overall management of the business. BAC is primarily engaged in the business of cotton ginning and bailing. The manufacturing facilities of the firm is in Kadi (Mehsana-Gujarat) with installed capacity of 40.20 lakh kg per annum of cotton bales and 60 lakh kg per annum of cotton seeds as on March 31, 2018. BHAGAWATI DEVELOPMENT: CARE Reaffirms B+ Rating on INR3cr Loan -------------------------------------------------------------- CARE Ratings reaffirmed ratings on certain bank facilities of Bhagawati Development Services Private Limited, as: Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long-term Bank Facilities 3.00 CARE B+; Stable Reaffirmed Short-term Bank Facilities 5.25 CARE A4 Reaffirmed Detailed Rating Rationale & Key Rating Drivers The ratings continue to remain constrained on account of leveraged capital structure, weak debt coverage indicators and stressed liquidity position. The ratings, further constrained on account of exposure to risk related to strong linkage to the agricultural output. The rating, however, derives strength from the experienced promoter and established presence of group and improvement in scale of operations with moderate profitability. The ability of BDSPL to improve its scale of operation along with profitability, capital structure, and debt coverage indicators coupled with efficient management of its working capital requirements in light of competitive nature of the industry will remain the key rating sensitivities. Detailed description of the key rating drivers Key Rating Weakness Leveraged capital structure, weak debt coverage indicators: Capital structure of BDSPL remained leveraged marked by overall gearing of 5.57 times as on March 31, 2018, deteriorated from 4.79 times as on March 31, 2017. The deterioration was on account of higher utilisation of workings capital borrowings and increase in unsecured loans which resulted in higher increase in total debt as compared to increase in net worth. However, total debt to GCA has deteriorated and remained at 50.15 times in FY18 as compared to 32.79 times in FY17 mainly due to increase in total debt and decline in GCA level. Interest coverage stood moderate and remained at 1.26 times in FY18 as compared to 1.40 times in FY17, declined on account of higher interest cost. Stressed liquidity position: Liquidity position remained stressed marked by current ratio of 1.06 times and below unity quick ratio of 0.57 times as on March 31, 2018. The operating cycle remained elongated at 118 days mainly due to higher inventory period and collection period. The cash flow from operating activities was stood negative at INR1.75 crore during FY18 mainly due to higher working capital changes. It has utilized 90% of its working capital bank borrowings in last twelve month ended November 2018. It has cash & bank balance of INR0.24 crore as on March 31, 2018. Exposure to risk related to strong linkage to the agricultural output: BDSPL derives majority of its income from sales of tractors and the demand for the same largely depends on number of factors including ease availability of credit from bank, agriculture output and rural income. BDSPL's business activities are dependent on the output level of agriculture which in turn is dependent upon monsoon. Hence, any adverse movement in the farm output would impact the debt servicing capability of the company. Key Rating Strengths Experienced promoters and established presence of group: Mr. Saurabh Singh, Director, who has done his Engineering and is actively involved in business with an experience of nearly eight years. BDSPL being a family business all the key management positions are being held by family members of promoter. The promoters also engaged in similar business through its other entity BCPL which also engaged in warehousing and agro commodity trading and holds distributorship for M&M tractors. Bhagawati group was established in 1997 with the formation of Karan Developers (KD) followed by Bhagawati Palace in Bhind. Mr. Vikram Singh served as a director in KD for 14 years and now the operations are looked after by his elder brother, Mr. Karan Singh who is also the chairman of KD. Later in September 2000, BCPL was formed to undertake warehousing and trading of agro commodities in Bhind, MP. In 2005, BCPL started the distributorship of M&M tractors in Gwalior. In 2002, Bhagawati Estate Warehouse Private Limited (BEWPL) started the business of warehousing and trading of agro commodities. Bhagawati Frontline Motorizer Private Limited (BFMPL) and Bhagawati India Motorizer Private Limited (BIMPL) are engaged in the dealership of passanger and commercial vehicle of M&M. Increase in scale of operations with moderate profitability Total Operating Income (TOI) of BDSPL has increased by 8.58% in FY18 over FY17 owing to increase in sales volume of tractor sales. Further, during FY18, sale of tractors and e-rickshaws increases and contributes 69.18% in TOI in FY18 as against 67.30% in FY17 and remaining income was generated from trading. PBILDT margin for FY18 has increased by 81 bps and remained at 6.26% in FY18 as against 5.45% in FY17 on account of decline in other manufacturing cost and selling costs. However, PAT margin decreased by 23 bps in FY18 and remained at 0.61% as compared to 0.84% in FY17 owing to higher interest cost. As a result of decline in profitability, GCA also declined marginally and remained at INR0.26 crore. Till November 30, 2018 BDSPL has achieved a turnover of INR 13.64 crore out of which tractor sales of INR10.41 crore, e-rickshaw sales of 0.03 core and wheat & other commodity of INR 3.20 crore. Diversified revenue stream including distributorship of M&M tractors, cold storage, warehousing and commodity trading BDSPL operates into the various segments such as M&M tractor distributorships (presence in Agra Mandal, Bhopal and Gwalior), running cold storage, providing warehousing facilities and trading of commodities. Incorporated in November 2005, BDSPL is a private limited company promoted by Mr.Vikram Singh Kirar. BDSPL is engaged into the warehousing and trading of commodities since 2005. BDSPL also offers finance against warehouse receipt to farmers. Further, during FY12 (refers to the period April 1 to March 31), BDSPL took the distributorship of Indo Farm tractors for the entire Madhya Pradesh (MP) region. Its group concern Bhagawati Cools Private Limited is the distributor of Mahindra and Mahindra (M&M) tractors in Gwalior, Agra Mandal and Bhopal region and is also engaged into the trading and warehousing of commodities, cold storage like BDSPL. The group incorporated Bhagawati India Motorizer Private Limited in October 2013 to take up the dealership of Mahindra & Mahindra (M&M) vehicles and servicing of auto parts in four districts of Madhya Pradesh (MP) namely Shahdol, Mandla, Dindori and Anuppur. The group also extends warehousing facilities through Bhagawati Estate Warehouse, Kolaras. Another group entity named Bhagawati Estate Warehouse; Ashoknagar is also engaged in warehousing and trading of agro-commodities like potatoes and wheat. BHAGAWATI INDIA: CARE Lowers Rating on INR15.24cr Loan to BB- ------------------------------------------------------------- CARE Ratings revised the ratings on certain bank facilities of Bhagawati India Motorizer Private Limited (BIMPL), as: Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long-term Bank 15.24 CARE BB-; Stable Revised from Facilities CARE B+; Stable Detailed Rating Rationale & Key Rating Drivers The revision in the ratings of BIMPL take into account continuous improvement in Total Operating Income (TOI) in last three financial year ended FY18 (FY refers to the period April 1, to March 31). The ratings, however, continue to remain constrained on account of leveraged capital structure and weak debt coverage indicators with moderate liquidity position. The rating is, further, continued to remain constrained on account of volume driven business with high competition in auto dealership industry and limited bargaining power with principal automobile manufacturer. The rating, however, continues to derive strength from the wide experience of the promoters and established presence of the group in various business segments and significant improvement in Total Operating Income (TOI) along with moderate profitability margins. BIMPL's ability to improve its scale of operations with an improvement in overall financial risk profile marked by improvement in profit margins and better management of working capital would be the key rating sensitivities. Detailed description of the key rating drivers Key Rating Weakness Leveraged capital structure and weak debt coverage indicators: The capital structure of BIML stood leveraged although improved marginally with an overall gearing from 8.03 times as on March 31, 2017 to 6.95 times as on March 31, 2018 mainly on account of schedule repayment of term debt and accretion in reserves. Further, the debt service coverage indicators stood weak marked by Total debt to GCA at 16.08 times as on March 31, 2018 improved as against 18.32 times as on March 31, 2017 owing to decline in total debt and increase in GCA level. Further, Interest coverage ratio remained at 1.73 times in FY18 as compared to 1.72 times in FY17. Moderate liquidity position: On account of high working capital intensity, BIMPL's fund based limits remained almost fully utilised during past 12 months ending November, 2018.Current ratio and Quick ratio stood below unity at 0.85 times and 0.37 times respectively in FY18.Operating cycle remained comfortable at 55 days in FY18 as against 58 days in FY17. The cash flow from operating activities has deteriorated from positive cash flow of INR0.52 crore in FY17 to negative cash flow of INR0.13crore mainly due to higher working capital gap. It has cash & bank balance of INR0.20 crore as on March 31, 2018. Volume driven business with high competition in auto dealership industry and limited bargaining power with principal automobile manufacturer: Indian automobile industry is highly competitive in nature as there are large numbers of players operating in the market like MSIL, Tata Motors, Hyundai, Honda, Toyota, Renault etc. in the passenger vehicle segment. Original Equipment Manufacturers (OEMs) are encouraging more dealerships to improve penetration and sales, thereby increasing competition amongst dealers. Entry of the global players in the Indian market has further intensified the competition. Hence, OEMs offer various discount schemes to attract customers. Due to very high competition in the industry, dealers are also forced to pass on discounts and exchange schemes to attract customer as this is a volume driven business. Dealers' fate is also linked to the industry scenario and performance of OEMs. BIML is dealer of Mahindra & Mahindra (M&M) and it derives its TOI from sale of M&M's passenger cars and spare parts. Hence, performance and prospects of BIML is highly dependent on M&M being its principal. Further, in this business a dealer has very less bargaining power over principal manufacturer. The margin on products is set at a particular level by the principal manufacturer thereby restricting the company to earn incremental income. Key Rating Strengths Experienced promoters and established presence of group: BIML is promoted mainly by Mr.Saurabh Singh, nephew of Mr.Vikram Singh, who is the key promoter of Bhagawati group. Mr.Saurabh Singh is associated with Bhagawati group over the past 10 years and is also a director in BDSPL (Bhagawati Development Services Private Limited). He is an engineer by qualification and is actively involved in the family business along with Mr.Vikram Singh. Continuous improvement in Total Operating Income (TOI) along with moderate profitability margin: Total Operating Income (TOI) of the company has witnessed continuous growth and grew at a CAGR of 26.39% in last three financial years ended FY18. During FY18 TOI of the company has improved by 18.77% over FY17 mainly on account of increase in sale of vehicles. During FY18, BIML has sold total 1700 vehicles (out of which 877 personal vehicles and 823 commercial vehicles) as against 1453 vehicles during FY17. From September 2018, the company has also took the distributorship of Ford passenger carsand till November, 2018 it has sold around 15 cars. Further, the profitability of the company stood moderate marked by PBILDT and PAT margin of 3.37% and 0.73% respectively in FY18. During FY18, PBILDT margin has declined by 9 bps and remained at 3.37% in FY18 as compared to 3.46% in FY17 owing to increase in employee and administration cost. However, PAT margin of the company has increased by 28 bps owing to proportionality higher increase in TOI. Further, The gross cash accruals of the company has improved by 27.16% and registered GCA of INR1.57 crore in FY18 owing to increase in scale of operations. BIML was incorporated in October 2013 to take up the dealership of Mahindra & Mahindra (M&M) vehicles and servicing of auto parts in four districts of Madhya Pradesh (MP) namely Shahdol, Mandla, Dindori and Anuppur. BIML is a part of Gwalior based Bhagawati group which has varied business interests in the state of Madhya Pradesh. The group is engaged in dealership of Mahindra & Mahindra and Indo farm tractors through Bhagawati Cools Private Limited and Bhagawati Development Services Private Limited. The group also extends warehousing facilities through Bhagawati Estate Warehouse, Kolaras. BCPL and BDSPL are also engaged in trading of agro-commodities like wheat, potato, soya etc. Another group entity named Bhagawati Estate Warehouse; Ashoknagar is also engaged in warehousing and trading of agro-commodities like potatoes and wheat. BHINMAL CONTRACTORS: CARE Assigns B+ Rating to INR1.50cr Loan ------------------------------------------------------------- CARE Ratings has assigned rating to the bank facilities of Bhinmal Contractors Property & Land Developers Private Limited (BCPL), as: Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long-term Bank Facilities 1.50 CARE B+; Stable Assigned Short-term Bank Facilities 5.00 CARE A4 Assigned Detailed Rationale & Key rating Drivers The ratings assigned to the bank facilities of BCPL are primarily constrained on account of small scale of operations coupled with net loss in FY18 (FY refers to the period from April 1 to March 31) in the highly competitive civil construction industry and vulnerability of margins to fluctuation in the raw material prices. The ratings, further, constrained on account of leveraged capital structure and moderate liquidity position. The ratings, however, favorably takes into account the vide experience of the promoters in the civil construction industry and moderate order book position. The ability of the company to increase its scale of operations by securing more contracts along with speedy execution of same with better management of working capital would be the key rating sensitivities. Detailed description of the key rating drivers Key Rating Weakness Small scale of operation coupled with net loss in FY18: Owing to tender driven nature of business, BCPL's scale of operation remained fluctuating during past three years ended FY18 and stood low at INR10.46 crore in FY18. Further, PBILDT margin stood moderate at 11.63% in FY18, significantly improved by 486 bps over FY17 owing to proportionately lower subcontractor expenses. However, due to higher interest and depreciation expenses, it has reported net loss of INR0.01 crore in FY18. Leveraged Capital structure and moderate debt coverage indicators: BCPL's capital structure stood leveraged owing to low net worth base of INR1.88 crore in FY18 which led to overall gearing of 2.86 times as on March 31, 2018. Further, the debt coverage indicators of the company stood moderate marked by Total debt to GCA of 8.19 times and interest coverage at 2.00 times in FY18. Moderate liquidity position: BCPL recognizes revenue after completion and certification of work and does not maintain inventory hence inventory holding period remains zero. Further, operating cycle remained negative in past three financial years owing to higher creditor days than collection period. However, utilization of working capital bank borrowing of the company remained more than 90% during last 12 month ended November 2018. Further, current ratio and quick ratio also stood below unity at 0.83 times and 0.63 times respectively as on March 31, 2018. Cash and bank balance stood at INR0.52 crore as on March 31, 2018. High competitive intensity in the government civil construction segment and vulnerability of margins to fluctuation in raw material prices: The construction industry is highly fragmented in nature with presence of large number of unorganized players and a few large organized players coupled with the tender driven nature of construction contracts poses huge competition and puts pressure on the profitability margins of the players. Further, as the company participates in tenders invited by large lead contractor, high competition and lower bargaining power restricts its profitability margins. Further, the profitability of the company is exposed to fluctuation in raw material prices where contract size is less than one contract and contract period is less than one year. Key Rating Strengths Experienced management coupled with long track record of operation: The company is engaged in the civil construction industry for more than two decades and hence it has long track record of operations in the industry. The overall affairs of the company are managed by Mr. Suresh Mehta and Mr. Ashok Mehta since incorporation of the company. Moderate order book position: As on September 30, 2018, BCPL has moderate order book position of INR16.59crore, forming 1.59 times of Total Operating Income (TOI) in FY18 with total eight projects in hand related to construction of road. The on-going projects of the company are likely to be executed within a period of 12months, providing short term revenue visibility. Bhinmal Contractors Property & Land Developers Private Limited (BCPL) was incorporated in 1996 by Mr. Suresh Mehta and Mr Ashok Mehta with an objective to carry out all kind of construction and development work. The company is 'AA' class approved contractor with Public Works Department (PWD), Rajasthan and is engaged in the construction of roads for government department. BOMMIDALA SREERAM: CRISIL Migrates B Rating from Not Cooperating ---------------------------------------------------------------- Due to inadequate information and in line with Securities and Exchange Board of India guidelines, CRISIL had migrated its rating on the long-term bank facilities of Bommidala Sreeram Agro Traders Pvt Ltd (BSAT) to 'CRISIL B/Stable Issuer Not Cooperating'. However, the company's management has shared the information necessary for a comprehensive review of the rating. Consequently, CRISIL is migrating the rating to 'CRISIL B/Stable' from 'CRISIL B/Stable Issuer Not Cooperating'. Amount Facilities (INR Crore) Ratings ---------- ----------- ------- Cash Credit 7 CRISIL B/Stable (Migrated from 'CRISIL B/Stable ISSUER NOT COOPERATING') Long Term Loan 5.5 CRISIL B/Stable (Migrated from 'CRISIL B/Stable ISSUER NOT COOPERATING') Proposed Long 14.5 CRISIL B/Stable (Migrated from Term Bank Loan 'CRISIL B/Stable ISSUER NOT Facility COOPERATING') The rating reflects the company's large working capital requirement, small scale of operations in the intensely competitive edible oil industry, and susceptibility of profitability to volatility in raw material prices. These weaknesses are partially offset by the extensive industry experience of the promoters, and the company's comfortable financial risk profile driven by above-average networth, low gearing, and comfortable debt protection metrics. Key Rating Drivers & Detailed Description Weaknesses * Modest scale of operations: BSAT is a small player in the highly fragmented edible oil extraction industry. Its revenue was INR3.03 crore in fiscal 2018. The industry is fragmented due to low capital intensity and limited value addition, which results in low entry barriers. Around 70% of the edible oil industry comprises unorganised players, primarily catering to regional demand to save on high transportation cost. * Large working capital requirement: The company's working capital-intensive operations are reflected in gross current assets of 2832 days as on March 31, 2018, driven by large inventory and receivables of 2706 and 289 days, respectively. CRISIL believes the company's operations will remain working capital intensive over the medium term on account of the seasonal nature of the product. * Susceptibility to volatility in raw material prices: BSAT's operating margin was highly volatile over the three fiscals ended March 31, 2018 (22.85% in fiscal 2018) and the company had an operating loss in fiscal 2014. Cotton seed, being an agricultural product, is vulnerable to scanty/excess rainfall, crop diseases, pest attacks, low yield, limited availability of fertilisers, among other issues. Cotton seed oil prices are, therefore, volatile and prone to fluctuations in supply of seeds. Any unforeseen and significant increase in raw material prices can adversely affect BSAT's operating margin. Hence, CRISIL believes BSAT will remain susceptible to volatility in raw material prices. Strengths * Extensive industry experience of the promoters: BSAT's business risk profile benefits from its established regional presence in the edible oil industry aided by its promoters' extensive experience. The company has been associated with the edible oil industry for around a decade. The promoters' experience has enabled the company to establish healthy relationships with local cotton farmers and traders, thereby enabling timely availability of raw material. * Comfortable financial risk profile: The financial risk profile is supported by low gearing and comfortable debt protection metrics. The promoters have been conservative with respect to debt. Because of large networth of INR34.64 crore, the company reported low gearing and total outside liabilities to tangible networth ratio of 0.07 and 0.10 time, respectively, as on March 31, 2018. Interest coverage and net cash accrual to adjusted debt ratio were 10.45 times and 0.47 time, respectively, for fiscal 2018. Outlook: Stable CRISIL believes BSAT will continue to benefit from its promoters' extensive industry experience. The outlook may be revised to 'Positive' if the company registers a substantial and sustained increase in revenue, while maintaining profitability, or improves working capital management. The outlook may be revised to 'Negative' if there is a steep decline in revenue or profitability, or significant weakening of capital structure because of large debt-funded capital expenditure or a stretch in working capital cycle. Liquidity Liquidity is likely to remain heathy over the medium term. Cash and cash equivalents was INR1.28 crore as on March 31, 2018. Cash accrual is projected at INR18.0-20.0 crore per annum over the medium term, against no debt obligations. Bank limit utilisation has been low, averaging merely 9% over the 12 months through October 2018. With no large capex plans over the medium term, cash accrual along with cash and cash equivalents will be able to meet the working capital requirement. BSAT, a part of the Bommidala group, was established in 1996 after the division of assets in the Bommidala family of Guntur (Andhra Pradesh). The company trades in cotton lint and seed, and operates a cotton seed oil processing facility. GADDALA FINANCIAL: CRISIL Reaffirms B Rating on INR10cr Loan ------------------------------------------------------------ CRISIL has reaffirmed its 'CRISIL B/Stable' rating on the proposed long-term bank loan facility of Gaddala Financial Services Private Limited (GFS). The rating reflects the company's small scale of operations with geographic concentration, and modest resource profile. These weaknesses are partially offset by adequate capitalisation and extensive experience of the promoter. Amount Facilities (INR Crore) Ratings ---------- ----------- ------- Proposed Long Term 10 CRISIL B/Stable Reaffirmed) Bank Loan Facility Analytical Approach For arriving at the rating, CRISIL has considered the standalone business and financial risk profile of GFS. Key Rating Drivers & Detailed Description Weakness * Small scale of operations with geographic concentration: With assets under management of INR3.7 crore as on September 30, 2018, the company's scale is small compared with other non-banking financial companies. Moreover, operations are confined to five districts in Telangana and are susceptible to local and social economic issues. * Modest resource profile: GFS has only one financing relationship. The ability to raise more borrowed funds needs to be demonstrated. * Inherent modest credit profile of the borrowers: A significant portion of the portfolio comprises unsecured lending portfolio with below average credit risk profiles and lack of access to formal credit. These borrowers are small business owners or small traders and their income flows could be volatile and dependant on the local money. Strengths * Adequate capitalisation: Capitalisation remained adequate, as reflected in networth of INR2.4 crore and gearing of 0.7 time as on September 30, 2018. The gearing is expected to remain below 2 times in the near term. * Extensive experience of the promoter: The promoter has extensive experience in the financing business. Before GFS, he managed a society that had a considerable microfinance portfolio. However, due to crisis in the microfinance sector in Andhra Pradesh, the society shut down operations. The management has deep understanding of the region the company operates in. Outlook: Stable Capitalisation is likely to remain adequate over the medium term. However, the scale of operations is expected to remain modest and geographically concentrated. The outlook may be revised to 'Positive' if market position improves significantly and if the company is able to borrow funds without compromising asset quality. The outlook may be revised to 'Negative' if asset quality and profitability deteriorate, thereby impacting capitalisation. Liquidity The company has maintained cash and cash equivalent of INR2.2 lakh. It has projected receipts of INR74.7 lakh from its borrowers against debt obligation of INR26 lakh for the next 4 months. GFS is promoted by Mr John Gaddala, who acquired the company from Mr Poorna Chandra Rao in 2009. The company was earlier called Vanki Neni, and operated as a hire purchase firm. After its acquisition and renaming, it started operations as an NBFC in 2010. The company is a NBFC offering secured & unsecured loans to individuals. The company directly lends to individuals. GFS is based out of Telangana confined to only few districts such as Warangal, Mahubudabad, Jangaon and Hyderabad. The company offers two types of portfolio unsecured loans to small business or traders and housing construction loans. The unsecured business loans have a shorter tenure with three months to one year. The yields charged by the company range between 20 to 24%. The housing construction loans typically have a long tenure of three years and the yields charged are at 15%.It operates only in a few districts of Telangana, such as Warangal, Mahubudabad, Jangaon, and Hyderabad. GAMA INFRAPROP: Ind-Ra Assigns 'B-' Rating, Outlook Stable ---------------------------------------------------------- India Ratings and Research (Ind-Ra) has assigned ratings to Gama Infraprop Private Limited's (GIPL) debt facilities as follows: -- INR3,016.42 bil. Senior project bank loans assigned with IND B-/Stable rating; -- INR299.8 mil. Cash credit facility assigned with IND B-/Stable rating; -- INR651.8 mil. Letter of credit assigned with IND B-/Stable rating; -- INR175.8 mil. Bank guarantee assigned with IND B-/Stable rating; and -- INR40.0 mil. Performance bank guarantee assigned with IND B-/Stable rating. KEY RATING DRIVERS The ratings reflect the gas availability risk, as the amount of gas required by the power plant is never met fully due to the overall gas supply deficit scenario in the country, The fuel supply agreement with Gas Authority of India Limited (GAIL: 'IND AAA'/Stable) is short-term, on a take-or-pay basis and valid from October 3, 2018 till October 1, 2019 only. The contracted gas price is USD8.03/million metric British thermal unit (MMBTU) (INR123.89/MMBtu). The agency expects prices of liquified natural gas (LNG) to stand at USD8.0-9.0/MMBTU in FY19, driven by China's transition towards cleaner fuels. Furthermore, GIPL has entered into tie-ups for only 50% capacity (107MW) of the power plant. The power is being purchased by Uttarakhand Power Corporation Limited (UPCL), and the power purchase agreement is valid for 25 years from the commercial operations date. UPCL has been making payments on an average of 20 days from the date of invoice. The tariff payments, comprising capacity and energy charges, are determined by Uttarakhand Electricity Regulatory Commission (UERC). However, during 2017, the company filed a petition with the Appellate Tribunal for Electricity, New Delhi for hiking the tariff fixed by UERC. The ratings also reflect GIPL's tight liquidity position, with high cash credit utilization during April-December 2018. Also, the cash and bank balance as on December 31, 2018 was just INR27 million and the company does not maintain a debt service reserve. Hence, any delay in payments from the off-taker can lead to a delay in debt servicing. The ratings, however, are supported by limited refinancing risks, given a long tail period of about 13 years. The company's original sanctioned senior debt facilities had been restructured under the S4A scheme in January 2017. The sustainable debt was ascertained at INR4,495.3 million (54.54% of the total debt). The sustainable debt is repayable in 47 structured quarterly installments, which commenced from 31 December 2016 and will end on 30 June 2028. The balance original sanctioned debt had been converted during the restructuring exercise into equity, optionally convertible debentures (OCD), and redeemable cumulative optionally convertible preference shares (RCOCPS) (total outstanding of INR3,717.3 million as on January 1, 2019). The repayments for OCD/RCOCPS will be subordinate to the sustainable debt and will be paid in five installments of 20% each (INR500 million for preference shares and INR226.7 million for OCDs), starting November 30, 2025 and ending November 30, 2029. Also, operational risks are mitigated by GIPL's routine O&M requirements being handled by an established contractor, M/s STEAG Energy Services India Private Limited, which provides O&M services to over 5000MW of thermal power plants (both gas-fired and coal fired) across the country. RATING SENSITIVITIES Positive: Creation of adequate liquidity and operational and financial performance that is better than base case estimates , all on a sustained basis, could result in a rating upgrade. Negative: Discontinuation of plant operations due to plant breakdowns, continued unavailability of gas, non-payment or material delay in receivables from the off-taker could lead to a negative rating action. COMPANY PROFILE GIPL is promoted by M/s RLG group, which is engaged in chemical manufacturing, pharmaceutical manufacturing, and power generation. It was incorporated under the Companies Act, 1956, to develop and operate a 225MW (name plate capacity) combined cycle gas-fired power plant in Udhamsinghnagar, Uttarakhand. The project is designed to use natural gas/re-gasified liquefied natural Gas as the main fuels for power generation. The power plant achieved commercial operations date on 16 March 2016. HARIOM TRADERS: CARE Raises Rating on INR12cr LT Loan to B+ ----------------------------------------------------------- CARE Ratings revised the ratings on certain bank facilities of Hariom Traders, as: Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long-term Bank 12.00 CARE B+; Stable Revised from Facilities CARE B; Stable; Issuer Not Cooperating In the absence of minimum information required for the purpose of rating, CARE was unable to express an opinion on the rating of Hariom Traders and in line with the extant SEBI guidelines, CARE revised the rating of bank facilities of the entity to 'CARE B; Stable; ISSUER NOT COOPERATING'. However, the entity has now submitted the requisite information to CARE. CARE has carried out a full review of the rating and the long term rating stands at CARE B+; Stable. Detailed Rationale & Key Rating Drivers The rating assigned to the bank facility of Hariom Traders is constrained by its constitution as a proprietorship entity, small scale of operation with low profitability margin, competitive nature of industry, high working capital intensity, and high leverage ratios with weak debt coverage indicators. However, the aforesaid constraints are partially offset by its experienced proprietor, satisfactory track record of operation and satisfactory demand outlook of grocery items. The ability of the entity to grow its scale of operations and improve its profit margins and ability to manage working capital effectively would be the key rating sensitivities. Detailed description of the key rating drivers Key Rating Strengths Experienced proprietor: Mr. Ashis Kumar Sahoo (proprietor) who has 19 years of experience in the similar line of business looks after day to day operation of the entity. Further, he is supported by his brother Mr. Manoj Kumar Sahoo and Mr. Manish Kumar Sahoo who have rich experience in the same line of business. Satisfactory track record of operation: Hariom Traders has commenced operations from October 1947. Since its inception the entity has been engaged in the grocery business. The entity has long track record of operation. Over the years, Hariom Traders has been able to grow over the years by constantly improving its service. Satisfactory demand outlook of grocery items: Grocery stores and supermarkets stock a wide variety of food, beverages, and household items. Generally, stores sell a mix of fresh and frozen foods, packaged and canned goods, produce, meats, dairy products, nonfood items, and household goods. Selection may vary depending on format, retail strategy, and location. Accordingly, the demand of grocery items is satisfactory in near future. Key Rating Weaknesses Constitution as a proprietorship entity: Hariom Traders, being a proprietorship entity, is exposed to inherent risk of the proprietor's capital being withdrawn at time of personal contingency and entity being dissolved upon the death/insolvency of the proprietor. Furthermore, proprietorship entities have restricted access to external borrowing as credit worthiness of proprietor would be the key factors affecting credit decision for the lenders. Small scale of operation with low profitability margin: The entity is a relatively small player vis-a-vis other players in wholesale and retail business of grocery & FMCG products marked by its total operating income of INR69.63 crore (INR67.32 crore in FY17) with a PAT of INR0.22 crore (INR0.22 crore in FY17) in FY18. The total operating income increased in FY18 on account of stable demand of grocery and FMCG products in the market. The tangible net worth of the entity was at INR3.62 crore as on March 31, 2018. The small size restricts the financial flexibility of the entity in terms of stress and deprives it from benefits of economies of scale. Due to its relatively small scale of operations, the absolute profit levels of the entity also remained low. Furthermore, the profitability margins of the entity remained moderate marked by PBILDT margin of 2.00% (2.27%:FY17) and PAT margin of 0.32% (0.33%: FY17) in FY18. This apart the entity has achieved sale of INR55.00 crore during 9MFY19. Competitive nature of the industry: Grocery business is a dynamic and highly competitive industry, and it's becoming more so. With the economy seemingly emerging from the downturn, industry leaders are looking for a heightened understanding of shoppers' mind-sets. Grocery retailers will have to respond to four increasingly important trends that will reshape competition over the next several years, permanent shift to value seeking among consumers, rise of technology-enabled shopping, greater online encroachment and format and merchandise innovation. For grocery retailers to respond to these forces successfully, they need to rethink their strategies. This means assessing their overall strategic value proposition and the key capabilities system that will distinguish them from competitors. High working capital intensity: In grocery store and supermarket has a wide variety of food, beverages and household items. Grocery retailing business is a working capital intensive nature of business as the grocery retailers have to store grocery items in large quantity. Also, for obtaining grocery items need to deposit some security amount with the entity who manufactures that item. Accordingly, the working capital intensity remains high leading to higher stress on the financial risk profile of the grocery store. Average working capital utilization remained around 95% during last twelve months ended November, 2018. Leveraged capital structure with weak debt coverage indicators Capital structure of the entity remained leveraged as marked by overall gearing ratio of 3.95x as on March 31, 2017. Moreover, the debt coverage indicators also remained weak as marked by total debt to GCA ratio of 51.18x in FY18. However, interest coverage ratio remained moderate at 1.13x in FY18. Hariom Traders was established in October 1947 by Sahoo family of Oddisa with an objective to enter into the grocery business. The entity is engaged in wholesaling, retailing and distribution of all types of grocery items. The entity has taken distributorship of HUL and PepsiCo in the year 2011 and 2012 respectively. The registered office of the entity is located at PO- Chandanpur, Dist- Puri, Oddisa- 752001. The entity sells its products through dealers and distributors. Mr. Ashis Kumar Sahoo (Proprietor) who has around 18 years of experience in similar line of business looks after the day to day operation of the entity. Further, he is supported by his brother Mr. Manoj Kumar Sahoo and Mr. Manish Kumar Sahoo who have rich experience in the same line of business. INDRAYANI SALES: CARE Reaffirms B/A4 Rating on INR15cr Loan ----------------------------------------------------------- CARE Ratings reaffirmed ratings on certain bank facilities of Indrayani Sales Private Limited (ISPL), as: Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long-term/ 15.00 CARE B; Stable/CARE A4 Short-term Reaffirmed Bank Facilities Detailed Rationale & Key Rating Drivers The ratings assigned to the bank facilities of ISPL are continues to be constrained by relatively small & fluctuating scale of operations, moderate & fluctuating profit margins, highly leveraged capital structure, weak debt coverage indicators, working capital intensive nature of operations with stretched liquidity position, supplier concentration & foreign exchange fluctuation risk and presence in competitive & fragmented industry. The ratings, however, derive strength from the company's established track record of operations coupled with highly experienced promoters in remanufacturing and trading of cartridges & parts business, established relationship with diversified customer base. The ability of the company to increase the scale of operations and improve profit margins amidst competitive scenario and to improve the capital structure and the liquidity position by efficiently managing the operating cycle is the key rating sensitivity. Detailed description of the key rating drivers Key Rating Weaknesses Relatively small scale of operations with fluctuations over last 3 years: Overall, the scale of operations of ISPL stood small and the same has declined over past three years ended FY18 with a total operating income of INR23.83 crore in FY18 (vis-Ö-vis INR31.28 crore in FY17 and INR34.01 crore in FY16), due to discontinuation of manufacturing of cartridges activity. However, the same was routed through its group concern i.e. Print It India Pvt Ltd, which was incorporated in July 2016. Further, the net- worth base also remained low at INR4.55 crore as on March 31, 2018, thereby limiting the financial flexibility of the company. Moderate & fluctuating profit margins: The PBILDT margin of ISPL stood moderate in the range of 5-11% over FY16-FY18. Moreover, the same has been fluctuating over the same period owing to fluctuations in raw material prices and employee costs. Highly leveraged capital structure & weak debt coverage indicators: The capital structure of ISPL is highly leveraged with overall gearing stood at 3.24x as on March 31, 2018, given the high reliance on external borrowings to fund the working capital requirements of the company. Given this, coupled with low profitability and high interest costs, the debt coverage indicators stood weak over the aforementioned period. Working capital intensive nature of operations marked by elongated operating cycle: The operations of ISPL are highly working capital intensive in nature with majority of funds of over 130-165 days blocked in inventory and over 80-125 days blocked in debtors. Against the same, the company receives limited credit period of 15 to 30 days from its suppliers. Due to which working capital utilization remained high. Furthermore, operating cycle remained significantly stretched at 274 days in FY18 (vis-Ö-vis 227 days FY17). Supplier concentration & foreign exchange fluctuation risk: ISPL is exposed to supplier concentration risk with the top 5 suppliers comprising 69.01% (vis-Ö-vis 54.82% of the total purchases in FY17). Moreover, the company is also exposed to significant foreign exchange fluctuation risk since the entire procurement requirement is met by way of imports from China and Korea. Furthermore, the company doesn't undertake any hedging activities to mitigate the said risk. Presence in competitive & fragmented industry: ISPL operates in a highly competitive & fragmented industry wherein a large number of small & medium players are engaged in manufacturing & remanufacturing of cartridges and trading of parts thereof. Moreover, the said line of activity is not much capital intensive, since it involves only assembling & reassembling of various cartridge parts, which intensifies the competition in the market. Key Rating Strengths Established track record of operations in remanufacturing of cartridges and trading of parts thereof: ISPL possesses and established track record of over 13 years of operations in remanufacturing of cartridges and trading of various cartridge parts, which are used in laser printers & copiers at various corporate offices, shops, copy centers, etc. The remanufacturing process comprises dismantling of old cartridges received from the customers, thereby replacing the worn & torn parts with the new ones and re-assembling the same. The manufacturing facility of ISPL is located at Patalganga in Raigad, whereas the same is certified by BSCIC and ISO 14001:2004. Experienced promoters in remanufacturing and trading of cartridges and their spare parts business: The overall operations of ISPL are looked after by the promoters - Mr. Rahul Zine with Mr. Bapusaheb Jadhav, both of who possess a total experience of over 14 years in the field of remanufacturing of cartridges and trading of parts thereof. Established relationship with diversified customer base: The cartridges remanufactured by ISPL are sold to various corporates, shops, copy centers, etc. across various parts of India viz. Rajasthan, Tamil Nadu, Kerala, Maharashtra, West Bengal, Andhra Pradesh, etc. Moreover, the customer profile of the company is diversified with the top 5 customers comprising 20.54% of the net sales in FY18 (vis-Ö-vis 17.81% in FY17). Liquidity Analysis: The liquidity position of the company is marked by low current ratio and quick ratio at 1.11 times and 0.58 times as on Mar 31, 2018 respectively (vis-Ö-vis 1.19 times and 0.56 times as on March 31, 2017 respectively). Further, cash flow from operating activities remained negative of INR0.44 crore (vis-Ö-vis positive INR4.00crore in FY17). The utilization of working capital limits remained high at 99% during past 12 months ended November, 2018. Further, cash and bank balance remained at INR0.45 crore in FY18 (vis-Ö-vis 0.40 crore in FY17). Incorporated in 2005 by Mr. Rahul Zine with Mr. Bapusaheb Jadhav, ISPL is engaged in trading of cartridges and cartridge parts which are used in laser printers & copiers. The said cartridges & parts thereof are sold to various corporates, shops, copy centers, etc. all over India, whereas the various parts & components viz. laser toner, OPC (Organic Photo Conductor) drums, toner powder, PCR (Primary Charge Roller) & roller parts, etc. are entirely procured from Korea and China. JINDAL POLYWEAVES: Ind-Ra Withdraws BB LT Rating, Stable Outlook ---------------------------------------------------------------- India Ratings and Research (Ind-Ra) has withdrawn Jindal Polyweaves Private Limited's (JPPL) Long-Term Issuer Rating of 'IND BB'. The Outlook was Stable. The instrument-wise rating action is: -- The 'IND BB' rating on the INR89 mil. Fund-based working capital facilities are withdrawn. KEY RATING DRIVERS Ind-Ra is no longer required to maintain the ratings as it has received a no dues certificate from the lender. COMPANY PROFILE Incorporated in 2005, Gujarat-based Jindal Polyweaves manufactures grey fabrics and texturized yarn. The company is also engaged in the trading of metalized polyester films. JODHANI PAPERS: CARE Hikes Rating on INR11.0cr LT Loan to BB ------------------------------------------------------------ CARE Ratings revised the ratings on certain bank facilities of Jodhani Papers Limited (JPL), as: Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long-term Bank 11.00 CARE BB; Stable Revised from Facilities CARE B+; Stable Detailed Rationale & Key Rating Drivers The revision in rating of JPL takes into account of significant increase in scale of operations due to capacity addition by the company, improvement in capital structure though remained at moderate level. The rating also positively factors in satisfactory liquidity profile, stable profitability margins and the long-standing experience of promoters in the paper manufacturing industry. However, these rating strengths are partially offset by highly fragmented paper industry and volatility in prices of waste paper. Going forward, the ability of JPL in to further scale up the operations by optimum capacity utilization while maintaining the profitability margins and improving the capital structure will be the key rating sensitivity Detailed description of the key rating drivers Key Rating Strengths Improvement in financial risk profile of company: JPL's operating income increased by 90.5% from INR 63.5 crore in FY17 to INR 121.0 crore in FY18 on account of completion of capex in Mar'17 which increased installed capacity from 30,000 MTPA to 54,000 MTPA. Despite FY18 being first year of operations of enhanced capacity, overall plant capacity utilization was high at 80.00% (FY17: 85.13%). Increase in sales translated into increase in cash profits from INR 3.77 crore in FY17 to INR 10.12 crore in FY18. However, due to higher repair and maintenance cost incurred by company in FY18, PBDIT margins remained stable. Satisfactory liquidity profile: Procurement of waste paper is largely on cash-n-carry basis while the company extends credit period of around 60 days to its customers. WC cycle reduced to 59 days in FY18 from 67 days in FY17 as company was efficient in receivables collection. Average CC utilization was around 70-75% for 12 months ended Nov'18. Long standing Experience of Promoters in paper manufacturing industry: JPL is promoted by Mr. Narendra Kumar Jodhani (MD), Mr. Nirmal Kumar Jodhani and Mr. Surendra Kumar Jodhani. Both have more than two decades of experience in paper manufacturing industry and look after all the financial, technical and marketing matters of the company. Mr. Nirmal also serves as a Director to Jodhani Foods Private Limited and Sri Balaji Malts Private Limited engaged in flour production and manufacturing of paper respectively. Key Rating Weaknesses Improving capital structure though leveraged: Overall gearing of the company though improved remains high at 2.06x as on Mar'18 (Mar'17: 3.28x). Improvement in capital structure was on account of debt repayments and accretion of profits. Fragmented nature of the industry and risks related to fluctuation in prices of waste paper: The paper manufacturing industry is highly fragmented in nature with stiff competition from a large number of organized as well as unorganized players limiting the pricing power of the manufacturers and hence the pressure on profitability. As the waste paper prices are volatile in nature which the raw material for JPL and constituted nearly 65% of the cost of production of the company in FY18; any volatility in the same can adversely impact the profitability margins of the company. Jodhani Papers Limited (JPL) was incorporated in the year 1992 as a public limited company (unlisted) by Mr. Narendra Kumar Jodhani, Mr. Nirmal Kumar Jodhani, Mr. Surendra Kumar Jodhani and other family members. The company is engaged in the manufacturing of kraft paper and has an installed capacity of 54,000 metric tonnes per annum (MTPA). The plant is located in the Doddaballapur Industrial Area, Bangalore (Karnataka). The entire revenue of the company is realized from domestic sales. The company procures raw materials majorly from domestic vendors. KHT AGENCIES: CARE Cuts INR53.06cr Loan Rating to B+, Not Coop. --------------------------------------------------------------- CARE Ratings revised the ratings on certain bank facilities of K.H.T. Agencies Private Limited (KHTAPL), as: Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long term Bank 53.06 CARE B+; Stable; ISSUER NOT Facilities COOPERATING Revised from CARE BB-; Stable on the basis of best available information Short term Bank 37.00 CARE A4; ISSUER NOT COOPERATING Facilities Revised from CARE A4 on the basis of best available information Detailed Rationale & Key Rating Drivers CARE has been seeking information from KHTAPL to monitor the rating(s) vide e-mail communications/letters dated December 7, 2018, December 5, 2018, November 30, 2018, November 15, 2018, November 1, 2018, October 31, 2018, October 4, 2018, October 1, 2018, September 4, 2018, August 2, 2018 and numerous phone calls. However, despite CARE's repeated requests, the company has not provided the requisite information for monitoring the ratings. In line with the extant SEBI guidelines, CARE has reviewed the rating on the basis of the best available information which however, in CARE's opinion is not sufficient to arrive at a fair rating. The rating on K.H.T. Agencies Private Ltd.'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(s). The ratings have been revised on account of continued losses reported by the company in FY18 and significant deterioration in capital structure. Detailed description of the key rating drivers At the time of last rating on December 11, 2017 the following were the rating strengths and weaknesses (updated for the FY18 audited annual report available from company): Key Rating Weaknesses Continued losses reported by company and deterioration in capital structure: Company continued to report net losses in FY18 though reduced to INR2.25 crore as against net loss INR4.44 crore in FY17. PBILDT margin has been thin at 1.75% in FY18 on account of low dealer margins. It may be mentioned that company had reported net profit of INR0.5 crore in 7MFY18. Owing to losses reported by company, overall gearing deteriorated from 4.03x as on Mar'17 to 5.92x as on Mar'18. Prospects linked to performance of its principals and intense competition in the dealership market: KHTAPL is an authorized dealer of TML, FIAT, Jeep, SMLI, and Ashok Leyland which makes the company vulnerable to the risk of change in policy by the principal with regards to the dealership. Product pricing is level marked by the principal companies at the time of dispatch, thereby restricting the company to earn incremental margins. Further, KHTAPL is also exposed to competition from the products of other OEM's and dealers operating in the same region. Key Rating Strengths Experienced & Resourceful Promoters: Mr. Kirit Morzaraia has been in the business for around nearly three decades. He looks after the dealership of SMLI. His son Mr. Adit Morzaraia looks after the passenger vehicle segment of TML, FIAT and Jeep. The promoters are also involved in the real estate business and entered into joint development with Sobha Limited for a luxury residential project in South Bangalore. Established presence in the auto dealership market with revenue diversification: KHTAPL has been dealing with SML Isuzu dealership since 1990 and over the years has added dealership of Tata and Fiat. In FY17 the company commenced Jeep dealership. Further, KHTAPL recently commenced Ashok Leyland dealership for supply of buses and plans to leverage the strong client base the company holds. M/s KHT Agencies Pvt. Ltd. (KHTAPL) was incorporated in 1990 by Mr. Kirit Morzaria. Initially it started with the dealership of commercial vehicles of SML Isuzu Limited (SMLI). After 19 years, in 2009, it entered into the dealership of passenger car segment of Tata Motors Limited (TML) & further expanded its product portfolio after getting passenger vehicle dealership of FIAT Group Automobiles India Private Limited (FIAT) in 2013. The company has 7 showrooms & 4 service centers in Bengaluru. In FY17, the company was awarded exclusive Jeep dealership in Bengaluru. Further, the company had taken up Ashok Leyland dealership in FY18. KL VENTURES: CARE Removes D Rating from Not Cooperating ------------------------------------------------------- CARE Ratings has removed the rating on bank facility of K. L. Ventures & Enterprises (KLVE) from Issuer Not Cooperating category. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long-term Bank 5.00 CARE D Revised from CARE D; Facilities ISSUER NOT COOPERATING Detailed Rationale & Key Rating Drivers The rating assigned to the bank facilities of KLVE is constrained by ongoing delays in debt servicing. The rating is further constrained by major pending execution work, funding & marketing risk inherent to high dependence on customer advances coupled with low booking status as on December 27, 2018 and presence in cyclical nature of the real estate industry. Hence, timely execution of projects by getting all necessary approvals coupled with timely execution of construction and other project works, along with timely funding availability in form of receipt of envisaged customer advances are the key rating sensitivities. Detailed description of the key rating drivers Key Rating Weaknesses Delays in debt servicing: There have been delays in debt servicing over 2-10 days in interest payments during past 12 months ended November 2018. Project execution risk inherent to majority unexecuted portion in ongoing project: KLVE's Satya Niwas Tower II project has been slow-moving, since as per the stay order from Bombay High Court on the new constructions in the BMC limits. Moreover, the project cost got escalated from INR19.40 crore (estimated at the time of initial rating in July 2017) to INR22.55 crore, of which the firm has incurred only 50.02% of the total project cost. Funding & marketing risk inherent to high dependence on customer advances coupled with unsold flats: Given the slow movement of Satya Niwas Tower II project owing to the reasons mentioned earlier, the term loan to the tune of only INR1.71 crore has been disbursed as on August 31, 2018, whereas the customer advances as on the same date stood at INR1.50 crore (vis-Ö-vis INR1.11 crore as on June 30, 2017). Incorporated in 2011 by Mr. Satish Aggarwal, K L Ventures & Enterprises (KLVE) belongs to the Lotus Group (LG), and is engaged in construction & development of residential spaces. The firm has recently completed a residential redevelopment project named Bhagwati Kripa at Malad (West), spanning across a total saleable area of 19,000 Sq. Ft. with G+9 floors of residential spaces. Moreover, LG has developed many residential as well as commercial spaces in Thane, Kandivali (West) and Malad (West). Currently, KLVE is undertaking a residential redevelopment cum fresh sale project named Satya Niwas Tower II at Malad (West), spanning across a total area of 41,176.05 Sq. Ft. (including area of tenant building, area of saleable building and common area) with 2 wings (A wing would be existing tenant building comprising G+9 floors with 3 1-BHK flats per floor, whereas B wing would be new saleable building comprising G+9 floors with 2 2-BHK flats per floor). K MOHAN: CRISIL Downgrades Rating on INR40cr Loan to D ------------------------------------------------------ CRISIL has downgraded the rating on the bank facilities of K Mohan and Company (Exports) Private Limited (KMCPL) to 'CRISIL D/CRSIL D/Issuer Not Cooperating' from 'CRISIL B/Stable/CRISIL A4 Issuer Not Cooperating' as there are delays in the repayment of the packing credit facility due to stretched liquidity and reduced profitability. Amount Facilities (INR Crore) Ratings ---------- ----------- ------- Export Packing 40 CRISIL D/Issuer Not Credit & Export Cooperating (ISSUER NOT Bills Negotiation COOPERATING; Downgraded from 'CRISIL A4 ISSUER NOT COOPERATING') Foreign Exchange 12 CRISIL D/Issuer Not Forward Cooperating (ISSUER NOT COOPERATING; Downgraded from 'CRISIL A4 ISSUER NOT COOPERATING') Proposed Long Term 4.5 CRISIL D/Issuer Not Bank Loan Facility Cooperating (ISSUER NOT COOPERATING; Downgraded from 'CRISIL A4 ISSUER NOT COOPERATING') CRISIL has been consistently following up with KMCPL for obtaining information through letters and emails dated March 31, 2018, and September 28, 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 KMCPL, which restricts CRISIL's ability to take a forward-looking view on the entity's credit quality. CRISIL believes information available on KMCPL 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, CRISIL has downgraded the rating on the bank facilities of KMCPL to 'CRISIL D/CRSIL D/Issuer Not Cooperating' from 'CRISIL B/Stable/CRISIL A4 Issuer Not Cooperating' as there are delays in the repayment of the packing credit facility due to stretched liquidity and reduced profitability. Set up in 1973 in Bengaluru, Karnataka, by Mr Raju M Mahtaney, KMCPL manufactures and exports ready-made garments. KRUPANIDHI CONST'N: CARE Reaffirms B+ Rating on INR3.5cr Loan ------------------------------------------------------------- CARE Ratings reaffirmed ratings on certain bank facilities of Krupanidhi Construction (KC), as: Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long-term Bank 3.50 CARE B+; Stable Reaffirmed Facilities Long-term/ 2.30 CARE B+; Stable/CARE A4 Short-term Reaffirmed Bank Facilities Detailed Rationale & Key Rating Drivers The ratings assigned to the bank facilities of KC continue to remain constrained on account of its overall financial risk profile marked by small scale of operations with modest profitability, moderate capital structure and weak debt coverage indicators along with modest liquidity position during FY18 (refers to the period April 1 to March 31). The ratings, further, continue to remain constrained on account of its proprietorship nature of constitution, susceptibility of its profit margins to fluctuations in raw material prices, geographical concentration risk and presence in a competitive and fragmented construction industry. The ratings, however, continue to derive strength from the vast experience of proprietor in the construction industry. The ability of KC to increase its scale of operations by bagging higher number of orders in the highly competitive civil construction industry along with improvement in overall financial risk profile marked by improvement in profit margins, solvency and overall liquidity position are the key rating sensitivities. Detailed description of the key rating drivers Key Rating Weaknesses Small scale of operations with modest profitability: During FY18, the scale of operations of KC as marked by total operating income (TOI) remained small at INR4.11 crore from INR5.97 crore during FY17 while the PBILDT continued to remain modest at INR1.03 crore (25.04%) during FY18 from INR0.99 crore (16.61%) during FY17. Consequently, PAT also stood low at INR0.34 crore (8.22%) during FY18 as against INR0.24 crore (3.94%) during FY17. The combined TOI of KC and KC's (49%) stake in Joint Venture formed by KC and Phaloudi Construction and Infrastructure Private Limited - PC AND IPL JV KC stood at INR13.79 crore in FY18 against INR13.63 crore in FY17, while the combined PBILDT stood at INR1.43 crore (10.37%) during FY18 as against INR1.86 crore (13.65%) during FY17. The combined PAT stood at INR0.57 crore (4.13%) during FY18 as against INR1 crore (7.34%) during FY17. The combined TOI of KC and KC's stake in PC AND IPL JV KC, stood at INR9.37 crore till November 30, 2018 (Prov.). Moderate capital structure and weak debt coverage indicators: Capital structure of the firm improved, albeit continued to remain moderate marked by overall gearing of 1.23 times as on March 31, 2018 as against 2.07 times as on March 31, 2017 on account of an increase in the tangible net worth level led by infusion of proprietor's capital coupled with a decrease in total debt level as on balance sheet date due to reduction in utilization of working capital borrowings. The debt coverage indicators of KC though improved over previous year, continued to remain weak as marked by total debt to GCA which stood at 11.03 times as on March 31, 2018 (P.Y.: 14.39), while the interest coverage ratio also stood moderate at 1.87 times during FY18 from 1.73 times during FY17. Modest liquidity position: The liquidity position of KC remained modest as marked by current ratio of 0.81 times as on March 31, 2018 as against 0.93 times as on March 31, 2017 owing to reduction in the value of trade receivables as on balance sheet date. The operating cycle of KC remained elongated at 83 days in FY18 (P.Y.:6 days). The average utilization of its working capital limit also stood higher around 98% during past twelve months ended November 2018. The cash and bank balance stood at INR0.25 crore, while the net cash flow from operations stood negative as on March 31, 2018. Proprietorship nature of constitution: KC being a proprietorship firm is exposed to the risk of withdrawal of capital by proprietor due to personal exigencies as well as dissolution of firm due to retirement of proprietor which restricts the overall financial flexibility of the firm. Susceptibility of its profit margins to fluctuations in raw material prices along with geographical concentration risk: The basic raw materials required by the firm are structural steel, cement, bitumen, asphalt; the prices of which are volatile in nature. In absence of price escalation clause, the profitability of KC is exposed to variations in raw material prices. Furthermore, during FY18 KC has executed the construction orders largely in the state of Madhya Pradesh (M.P.). Hence it exposes the firm to economic and political risk associated with concentrated geographical location. Competitive and fragmented nature of industry: The construction industry is fragmented in nature with a large number of medium scale players present at the regional level coupled with the tender driven nature of the construction contracts that poses huge competition and puts pressure on the profitability margins of the players. Key Rating Strengths Experienced proprietor: KC was established by Mr Ajay Shah having an experience of around more than 17 years in the construction industry. The long standing industry experience of the proprietor has led to strong relationships with the customers and suppliers. Vadodara-based (Gujarat) KC is a proprietorship firm established by Mr Ajay Shah in the year 2000. Mr Ajay Shah has an experience of 17 years in the construction industry. KC undertakes construction work of roads and canals; largely for the state of Madhya Pradesh. KC is 'AA' class rated contractor by Water Resources Department, Madhya Pradesh. KC sub contracts majority of construction work. KC has also formed a joint venture (49% share) with Phaloudi Constructions and Infrastructure Private Limited (PCIPL) named as PC AND IPL JV KC. M G THREADS: CARE Reaffirms B+ Rating on INR15.70cr LT Loan ----------------------------------------------------------- CARE Ratings reaffirmed ratings on certain bank facilities of M G Threads (MGT), as: Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term Bank Facilities 15.70 CARE B+; Stable Reaffirmed Short Term Bank Facilities 0.70 CARE A4 Reaffirmed Detailed Rationale & Key Rating Drivers The rating assigned to the bank facilities of MGT continues to remain constrained on account of susceptibility of its operating margin to fluctuations in raw material price along with presence in highly fragmented and competitive textile industry and partnership nature of its constitution. The ratings further remain constrained due to nascent stage of its operations with net losses, highly leveraged capital structure with weak debt coverage indicators and modest liquidity with working capital intensive nature of operations. The rating, however, continues to draw strength from experienced promoters. MGT's ability to increase its scale of operations along with improvement in profitability, capital structure and debt coverage indicators and efficient working capital management are key rating sensitivities. Detailed description of the key rating drivers Key Rating Weaknesses Nascent stage of operations with net losses incurred during the year: MGT commenced its operation from August 2017 onwards hence its operation is at nascent stage. Thus, MGT reported modest total operating income (TOI) of INR11.07 crore in FY18 (A). Further, MGT has reported moderate PBILDT margin of 5.34% during FY18 (A). However, owing to higher depreciation and interest costs incurred during the year, MGT has incurred net losses of INR3.01 crore during FY18 (A). Further MGT has incurred cash losses of INR0.57 crore during FY 18. Highly leveraged capital structure with weak debt coverage indicators: Owing to high debt level due to higher amount of term loan outstanding along with high working capital utilisation as on balance sheet date; coupled with low net-worth base, MGT's capital structure remained highly leveraged marked by an overall gearing ratio of 5.30 times as on March 31, 2018 (A). Further, debt coverage indicators of the MGT remained weak due to cash losses of INR0.57 crore during FY 18 (A). Further, interest coverage ratio also remained weak at 0.51 times in FY18 (A) owing to higher amount of interest cost incurred during the year. Modest liquidity with working capital nature of operations: Liquidity stood modest marked by current ratio of 1.05 times as on March 31, 2018 (A). During FY18 Cash flow from operating activities (CFO) remained negative at INR3.83 crore. Liquidity in form of cash and bank balance remained low at INR0.04 crore as on March 31, 2018. Average utilization of its working capital limit remained at 85% for past one year ended November 2018. Susceptibility of operating margins to fluctuations in raw material price: The raw material cost accounts for high proportion among total operating income for MGT. The basic raw materials used for manufacturing of polyester staple yarn (PSY) are polyester staple fibre (PSF) and to manufacture cotton yarn is raw cotton. Prices of these raw materials are volatile in nature which exposes its operating profitability to fluctuations in raw material prices. Highly fragmented and competitive nature of industry: The Indian textile industry also faces competition from the low cost manufacturing countries like China and Bangladesh. Smaller companies are more vulnerable to intense competition and have limited pricing flexibility, which constrains their profitability as compared with larger companies who have better efficiencies and pricing power considering their scale of operations. The highly fragmented textile processing industry restricts ability to completely pass the volatility in cost to customers, leading to lower profit margins. Partnership nature of its constitution: The constitution as a partnership firm restricts MGT's overall financial flexibility in terms of limited access to external funds for any future expansion plans. Furthermore, there is inherent risk of possibility of withdrawal of capital and dissolution of the firm in case of death/insolvency of partner which may affect financial flexibility of the firm. Key rating strengths Experienced promoters: The management of MGT rests in the hands of four partners viz. Mr Arvindbhai Modi, Mr Mahindrabhai Modi, Mr Hiteshbhai Modi and Mr Riteshbhai Modi. Mr Mahindrabhai Modi and Mr Arvindbhai Modi hold total experience of more than 25 years, while Mr Hiteshbhai Modi and Mr Riteshbhai Modi hold total experience of more than a decade. Banaskantha-based (Gujarat), M G Threads (MGT) was established in December 2015 by Mr Mahendra Modi, Mr Arvind Modi, Mr Hitesh Modi and Mr Ritesh Modi to carry out business of manufacturing cotton and polyester yarn through spinning process. MGT is completed its greenfield project to manufacture cotton and polyester yarn with installed capacity of 1500 MT per annum at its manufacturing facilities located at Banaskantha, Gujarat. MGT commenced operations from August 2017 onwards. Also, its associate concerns viz. M G Spintex Private Limited is also engaged in similar line of business. While M/s M G Textiles is engaged in trading of second hand machineries. NARESH SINGHAL: CARE Reaffirms B+ Rating on INR3.25cr LT Loan ------------------------------------------------------------- CARE Ratings reaffirmed ratings on certain bank facilities of Naresh Singhal & Company (NSC), as: Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long term Bank Facilities 3.25 CARE B+; Stable Reaffirmed Short term Bank Facilities 5.50 CARE A4 Reaffirmed Detailed Rational and key rating drivers The ratings assigned to the bank facilities of NSC continue to remain constrained by its small scale of operations coupled with low net worth base, leveraged capital structure and weak coverage indicators. The ratings are further constrained by elongated inventory holding, proprietorship nature of constitution and its presence in the highly fragmented and competitive industry. The ratings, however, continue to draw strength from the experienced proprietor in execution of civil contracts and long track record of operations of the firm and moderate profitability margins. Going forward, NSC's ability to profitably scale-up its operations while improving its capital structure along with successful execution of projects within the estimated time and costs would be the key rating sensitivities. Detailed description of key rating drivers Key rating weakness Small scale of operations with low net worth base: The scale of operations of the firm continues to remain small marked by a total operating income and gross cash accruals of INR11.84 crore and INR0.52 crore respectively during FY18 (FY refer to April 01 to March 31). Furthermore, as on March 31, 2018, the net worth base of the firm remained small at INR1.78 crore. The small scale of operations and low net worth base restricts the ability of the firm to scale up and bid for larger sized contracts having better operating margins. The firm has achieved total operating income of INR9.50 crore till 8MFY18 (refers to the period April 01 to November 30, based on provisional results). Leveraged capital structure coupled with weak debt service coverage indicators: The capital structure of the firm continues to remain leveraged owing to higher dependence on the external borrowing to meet the working capital requirements as marked by overall gearing ratio of above 3.00x as on the balance sheet date of the past two financial years i.e. FY17-FY18. The debt service coverage indicators continue to remain weak marked by interest coverage ratio and the total debt to GCA of 1.78x and 10.49 times respectively for FY18. Constitution of the entity being a proprietorship firm: NSC's constitution as a proprietorship firm has the inherent risk of possibility of withdrawal of the proprietor's capital at the time of personal contingency and firm being dissolved upon the death/retirement and insolvency of proprietor. Moreover, proprietorship firms have restricted access to external borrowing as credit worthiness of proprietor would be the key factors affecting credit decision for the lenders. Business risk associated with tender-based orders: The firm majorly undertakes projects for Public Works Department (PWD) and Municipal Corporation projects, which are awarded through the tender-based system. The tender-based business is characterized by intense competition and the growth of the business depends on its ability to successfully bid for the tenders and emerge as the lowest bidder. Also, as most of the business is tender-driven, the incumbent players have witnessed margin pressures due to aggressive bidding from the players seeking an entry in the market. Presence in the highly fragmented and competitive industry: The industry is characterized as fragmented and competitive nature as there are a large number of players in the organized and unorganized sector. Hence, going forward, due to increasing level of competition, the profits margins are likely to be range bound. Key rating strengths Experienced proprietor in execution of civil contracts and long track record of operations: NSC was established in 1992 by Mr. Naresh Singhal. Mr. Naresh Singhal is a graduate and has almost two and a half decades of experience in executing civil contracts through his association with NSC. He looks after the overall operations of the firm. Moderate Profitability margins: The profitability margins of NSC are directly associated with technical aspect of the contract. Further, the profitability varies with the project due to tender driven nature of the business owing to varying margins in the different projects undertaken by the company. The profitability margins of NSC stood moderate as marked by PBILDT margin and PAT margin of above 10.00% and 4.00% respectively for the past three financial years i.e. FY16-FY18. Moderate operating cycle: The operating cycle of the firm stood moderate at 29 days. The firm's customers are government departments of various states which have payment periods of around 1 month attributable to varying inspection and approval timelines. The firm kept optimum inventory at its sites resulting in an average inventory days of around 58 days in FY18. The firm received a credit period of around 45-60 days resulting in an average creditor period stood at 46 days for FY18. The sanctioned working capital limits remained fully utilized for the past 12- months period ending November 30, 2018. Naresh Singhal & Company (NSC) was established as a proprietorship firm in 1992 by Mr. Naresh Singhal. The firm is engaged execution of civil contracts viz. execution of sewage water pipelines, overhead tanks and water treatment facilities mainly in Delhi-NCR region. The majority of the contracts are obtained from Public Works Department (PWD) and Municipal Corporation through competitive bidding process. PATEL CONSTRUCTION: CARE Moves B+ Rating to Not Cooperating ----------------------------------------------------------- CARE Ratings has migrated the rating on bank facility of Patel Construction (Biaora) Private Limited (PCBPL) to Issuer Not Cooperating category. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long-term Bank 4.00 CARE B+; Stable; Issuer not Facilities cooperating; Based on best available information Short-term Bank 4.50 CARE A4; Issuer not Facilities cooperating; Based on best available information Detailed Rationale & Key rating Drivers PCBPL has not paid the surveillance fees for the rating exercise agreed to in its Rating Agreement. In line with the extant SEBI guidelines, CARE's rating on PCBPL's bank facilities will now be denoted as CARE B+/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(s). The rating assigned to the bank facilities of PCBPL is primarily constrained on account of its modest scale of operation with moderate profitability and stressed liquidity position and geographical and customer concentration of order book. The rating is, further, constrained on account of high competitive intensity in the government civil construction segment. The rating, however, derives strength from the experienced promoters and management, reputed client base. Detailed description of the key rating drivers Key Rating Weakness Modest scale of operation with moderate profitability: The scale of operations of the company remained modest with Total Operating Income (TOI) by 48.08% and stood at INR17.43 crore ending FY18. Further, profitability of the company stood moderate with PBILDT margin and PAT margin of 7.70% and 2.84% respectively in FY18 Provisional (P). Stressed liquidity position: Liquidity position of the company stood stressed with negative operating cycle in FY18. PCBPL's current and quick ratio 1.54 times as on March 31, 2018. Further, it has cash and bank balance of INR 0.03 crore ended March 31, 2018 (P). Geographical and customer concentration of order book: The client base of the firm is skewed towards government departments in Rajasthan with firm generating majority of its income from this institution. Further, unlike many other construction companies, it has remained focused on the road segment and moreover its orders under execution and the orders at bidding stage are also in the road segment. This makes it dependent on opportunities only in the road sector which is saddled with increased execution challenges. High competitive intensity in the government civil construction segment: The construction industry is highly fragmented in nature with presence of large number of unorganized players and a few large organized players which coupled with the tender driven nature of construction contracts poses huge competition and puts pressure on the profitability margins of the players. Key Rating Strengths Experienced promoters and management: Mr Goverdhan Dangi, graduate by qualification, looks after overall affairs of the company. He has experience of around fifteen years in the civil construction industry. He is assisted by Mr. Mahesh Dangi, MBA by qualification, having an experience of 5 years. Further, the directors are assisted by second tier management persons such as Mr Vishnu Dangi having an experience of 17 years who helps in managing the day to day affairs of the company. Reputed clientele base: PCBPL has established relationship with MPRRDA, WRD & PWD. PCBPL is eligible to participate in contracts of any amount pertaining to construction, installation and commissioning of road construction. Due to established relationship, PCBPL has been receiving repetitive orders from government departments. Moreover, it owns most of the machinery and equipment's it requires for project execution. on regular basis company is use to add latest plant and machinery since last few years to commensurate with the increase in the scale of operations and to facilitate efficient deployment of the resources and in order to timely execution of projects. Comfortable solvency position: The capital structure of the company stood comfortable with an overall gearing of 0.22 times as on March 31, 2018, improved from 0.57 times as on March 31, 2017. Further, debt service coverage indicators also stood comfortable with total debt to GCA of 1.58 times as on March 31, 2018, improved from 4.11 times as on March 31, 2017. Furthermore, interest coverage stood at 2.77 times in FY17. Patel Construction (Biaora) Private Limited (PCBPL) initially incorporated as Dangi Construction Private Limited in March 2000 by Mr. Goverdhan Dangi, subsequently renamed as PCBPL in October 8, 2002. PCBPL is engaged in the business of civil construction business with major focus on construction of roads and bridges for government department. It directly participates in government contracts and has long standing association with Madhya Pradesh Rural Road Development Authority (MPRRDA) and Public Works Department (PWD) Rajgarh, & Water Resources Department (WRD), in Madhya Pradesh for whom the company has been executing projects since its incorporation. PIYUSH ENTERPRISES: CRISIL Reaffirms B+ Rating on INR1cr Loan ------------------------------------------------------------- CRISIL has reaffirmed its 'CRISIL B+/Stable/CRISIL A4' ratings on the bank facilities of Piyush Enterprises (PE). Amount Facilities (INR Crore) Ratings ---------- ----------- ------- Bank Guarantee 5 CRISIL A4 (Reaffirmed) Cash Credit 1 CRISIL B+/Stable (Reaffirmed) The rating continues to reflect the firm's modest scale of operations, exposure to intense competition, large working capital requirement, and average financial risk profile. These weaknesses are partially offset by its established track record in the electrical contracting industry. Analytical Approach Unsecured loans of INR2.95 crore, extended by the proprietor as on March 31, 2018, are being treated as debt in absence of any track record of such loans. Key Rating Drivers & Detailed Description Weaknesses * Modest scale of operations: Scale of operations remains modest in the electrical contracting business, as reflected in operating revenue of INR5.89 crore in fiscal 2018. The firm undertakes projects for construction of substations and electrification work for state utilities, and thus, has limited scope to widen its scale. * Working capital-intensive operations: Operations were highly working capital intensive, as reflected in gross current assets of 342 days as on March 31, 2018, mainly due to the various deposits to be maintained with government agencies, and blockage of funds in the form of retention money and margin money for bank guarantee. * Average financial risk profile: Financial risk profile is constrained by modest networth and high gearing of INR11.1 crore and 4.91 times, respectively, as on March 31, 2018. Debt protection metrics were subdued, with interest coverage and net cash accrual to term debt ratios of 1.61 times and 0.05 time, respectively, in fiscal 2018. Strength * Extensive eperience of the proprietor in the electrical contracting industry: The nearly three-decade-long experience of the proprietor in undertaking substation and electrification work, and his track record of successful completion of several contracts for state utilities such as Uttar Pradesh Power Corporation Ltd (UPPCL), have helped the firm become an established player in the electrical contracting industry. Outlook: Stable CRISIL believes PE will continue to benefit from the extensive experience of its proprietor. The outlook may be revised to 'Positive' if the firm reports significant and sustained growth in revenue, and better profitability, and maintains a stable working capital cycle, and capital structure. The outlook may be revised to 'Negative' if a significant decline in revenue or profitability, stretched working capital cycle, or large, debt- funded capital expenditure, weakens the financial risk profile. Liquidity Liquidity is comfortable, marked by expected cash accrual of over INR0.62 crore against term debt of INR0.13 crore in the medium term, and a healthy current ratio of 2.28 times as on March 31, 2018. Bank limit utilisation was however high, averaging around 92% for the 12 months ended Oct 31, 2018. PE was set up in 1990, as a proprietorship firm of Mr Rajendra Prasad Gupta. It sets up substations and undertakes electrification work for state power transmission and distribution utilities in Uttar Pradesh. PRASHANT ENTERPRISES: CRISIL Lowers Rating on INR25cr Loan to B+ ---------------------------------------------------------------- CRISIL has downgraded its ratings on the bank facilities of Prashant Enterprises (PE) to 'CRISIL B+/Stable/CRISIL A4' from 'CRISIL BB/Stable/CRISIL A4+'. Amount Facilities (INR Crore) Ratings ---------- ----------- ------- Foreign Bill 25 CRISIL B+/Stable (Downgraded Discounting from 'CRISIL BB/Stable') Foreign Exchange 2 CRISIL A4 (Downgraded from Forward 'CRISIL A4+') Packing Credit 40 CRISIL A4 (Downgraded from 'CRISIL A4+') Proposed Fund- 3 CRISIL B+/Stable (Downgraded Based Bank Limits from 'CRISIL BB/Stable') The downgrade reflects deterioration in business risk profile, reflected in revenue and operating margin of INR83.56 crore and 8.9%, respectively, in fiscal 2018; against INR99.09 crore and 9.9%, respectively, in fiscal 2017. Working capital cycle was also stretched, with gross current assets (GCAs) of 467 days as on March 31, 2018, against 434 days in the previous year. The ratings reflect PE's average financial risk profile because of high gearing and large working capital requirement. These strengths are partially offset by the extensive experience of its promoters in the architectural hardware industry, and established relationship with principal clients. Key Rating Drivers & Detailed Description Weakness * Average financial risk profile: Though networth increased to INR35.74 crore as on March 31, 2018, from INR33.39 crore as on March 31, 2017; large inventory led to considerable debt. Hence, gearing remained high at 2.04 times as on March 31, 2018, while interest coverage ratio was weak at 1.7 times in fiscal 2018. * Large working capital requirement: The GCAs were 467 days as on March 31, 2018, on account of large inventory and stretched receivables. Operations will remain working capital intensive, leading to high bank limit utilisation. Strengths: * Extensive experience of promoters and established client base: Presence of over three decades in the architectural hardware segment has enabled the promoters to specialise in door knobs, handles, and hinges and also successfully enter the international market. Promoters have forged strong relationship with key customers in the UK, the US, and in a few European countries. Outlook: Stable PE will continue to benefit from its promoters' extensive experience and established clientele. The outlook may be revised to 'Positive' if sustained increase in revenue and profitability or improved working capital management strengthens financial risk profile. The outlook may be revised to 'Negative' if lower-than- expected revenue and accrual, stretch in working capital cycle, or capital withdrawal further weakens financial risk profile, especially liquidity. Liquidity Liquidity is adequate, driven by expected cash accrual of more than INR0.8 crore per annum in fiscals 2019 and 2020 against nil term debt. Cash and cash equivalents were healthy at INR5.82 crore as on March 31, 2018. Fund-based bank limit of INR68 crore was utilised at 87% during the 11 months ended September 2018. Set up in 1979 as a partnership firm by Singhal family in Aligarh, Uttar Pradesh; PE manufactures building and architectural hardware such as door knobs, handles, hinges, and hooks for exports to the US, South America, and Europe. RAM COTEX: CARE Reaffirms B+ Rating on INR6.50cr LT Loan -------------------------------------------------------- CARE Ratings reaffirmed ratings on certain bank facilities of Ram Cotex (RMC), as: Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long-term Bank Facilities 6.50 CARE B+; Stable Reaffirmed Detailed Rationale & Key Rating Drivers The rating assigned to the bank facilities of RMC continues to remain constrained on account of its moderate scale of operations coupled with thin profitability, moderate capital structure, weak debt coverage indicators during FY18 (refers to the period April 1 to March 31). The ratings further continue to remain constrained due to its presence in presence in highly fragmented textile industry along with seasonality associated with cotton availability and susceptibility of margins to cotton price fluctuations & government regulations and partnership nature of constitution. The rating, however, continues to draw strength from experienced partners, proximity to cotton growing area of Gujarat and satisfactory liquidity position. RMC's ability to increase its scale of operations along with improvement in profitability, capital structure anddebt coverage indicators and efficient working capital management are key rating sensitivities. Detailed description of the key rating drivers Key Rating Weaknesses Moderate scale of operations with thin profitability: The scale of operation marked by total operating income marginally deteriorated during FY18 due to decrease in demand from customers and remained moderate at INR46.41 crore as against INR46.86 crore in FY17. The profitability of RMC remained low as marked by PBILDT margin and PAT margin of 1.18% and 0.07% respectively during FY18 (A) as against 1.28% and 0.02% respectively during FY17 owing to its low value additive nature of business operation. Moderate capital structure and weak debt coverage indicators: Owing to high debt level with moderate net-worth base, RMC's capital structure stood moderate marked by an overall gearing ratio of 1.57 times as on March 31, 2018 (A) as against 2.23 times as on March 31, 2018. The debt coverage indicators of the firm remained weak marked by total debt to GCA of 13.35 times and interest coverage of 1.85 times in FY18 (A) owing to thin profitability with high debt level. Presence in highly fragmented textile industry: RMC operates in textile industry characterized by low entry barriers, high fragmentation, the presence of a large number of players in the organized and unorganized sector and very low bargaining power against its customers, puts pressure on the profitability margins. Seasonality associated with cotton availability and susceptibility of margins to cotton price fluctuations and government regulations: Prices of raw material i.e. raw cotton are highly volatile in nature and depend upon factors like, area under production, yield for the year, international demand supply scenario, export quota decided by government and inventory carry forward of last year. Further, cotton being a seasonal crop as it is available mainly from November to February results into a higher inventory holding period for the business. Thus, aggregate effect of both the above factors results in exposure of ginners to price volatility risk. Furthermore, the cotton prices in India are highly regulated by government through MSP (Minimum Support Price) fixed by government, though due to huge demand supply mismatch the prices have rarely been below the MSP. Hence, any adverse change in government policy may negatively impact the prices of raw cotton in domestic market and could result in lower realizations and profit. Partnership nature of constitution: Being a partnership firm, RMC is exposed to inherent risk of partners' capital being withdrawn at time of personal contingency, and firm being dissolved upon the death/retirement/insolvency of partners. Key rating strengths Experienced partners: Mr. Pankaj Patel, Mr. Bharatkumar Patel and MrShantilal Patel are the key partners of RMC, who looks after all day to day operation of the firm. All the partners possess more than a decade of experience in the same line of business. Proximity to cotton growing area of Gujarat: RMC's plant is located in cotton-producing belt of Gujarat region which is the largest producer of raw cotton in India. RMC'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. Satisfactory liquidity position: Liquidity position stood moderate marked by current ratio at 1.34 times as on March 31, 2018 (A) as against 1.04 times as on March 31, 2018. During FY18, cash flow from operating activities (CFO) remained at INR1.23 crore during FY 18 as against INR1.14 crore during FY17. Further liquidity in form of cash and bank balance remained low at INR0.43 crore as on March 31, 2018. Established in 2013, Ram Cotex (RMC) is a partnership firm. The firm is owned and managed by seven partners belong to Patel family. Mr. Pankaj Patel, Mr. Bharatkumar Patel and Mr. Shantilal Patel are the key partners of RMC, who looks after all day to day operation of the firm. RMC is engaged in ginning and pressing of raw cotton. RMC's manufacturing facility is located at Kadi in Mehsana District of Gujarat. RMC has an installed raw cotton processing capacity of 14,500 Metric Tonne per Annum(MTPA) as on March 31, 2018. Shree Ramlkrishna Oil Industries (rated CARE B+; Stable) is associate entity of RMC, which is engaged into cotton ginning, pressing and crushing of cotton seed since 1986. RAMCO EXTRUSION: CARE Reaffirms B+ Rating on INR20.35cr Loan ------------------------------------------------------------ CARE Ratings reaffirmed ratings on certain bank facilities of Ramco Extrusion Private Limited (REPL), as: Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long term Bank Facilities 10.00 CARE B+: Stable Reaffirmed Proposed Long term Bank Facilities 20.35 CARE B+: Stable Reaffirmed Detailed Rationale & Key Rating Drivers The rating assigned to the bank facilities of REPL continues to be constrained on account of moderate scale of operation coupled with low net worth base, moderate operating profit margin and relatively low net profit margin, leveraged capital structure and weak debt coverage indicators and working capital intensive nature of operations. The ratings further continue to be constrained on account of susceptibility to fluctuation in prices of raw materials and presence in highly fragmented and cyclical nature of metal industry. The rating however continues to derive strength from experienced and resourceful promoters and established relationship with clients. Ability to increase the scale of operation with increase in operating profitability margin and net profit margin along with to ability manage the working capital are the key rating sensitivities. Detailed description of Key rating drivers Key rating Weakness Moderate scale of operation coupled with low net worth base: During FY18, total operating income of the company grew by 19.50% in FY18 over FY17 to INR 50.98 crore on account of increased demand from regular customers. Further during 8MFY19, REPL posted total income of INR 50 crore. Nonetheless the scale of operation continues to remain moderate. Though REPL's net worth continued to remain low, it increased to INR 4.55 crore as on March 31, 2018 as against INR 2.83 crore as on March 31, 2017 due to issue of additional 1320000 shares of INR 10 each amounting to INR 1.32 crore in FY18 and accretion of profit to the net worth. Moderate operating profit margin and relatively low net profit margin: The operating profitability margins of REPL moderated to 4.24% in FY18 from 4.75% in FY17 due to lower realization with increase in power and fuel expenses, selling and distribution expenses. However, PAT margin increased to 0.46% during FY18 vis-Ö-vis 0.46% during FY17) due to lower depreciation expenses. Leveraged capital structure and weak debt coverage indicators: The capital structure of REPL remained highly leveraged on account of high reliance on external debt to fund the business operation coupled with low net worth base. The capital structure improved with overall gearing of 2.73x as on March 31, 2018 vis- Ö-vis 4.16x as on March 31, 2017 on account of increase in net worth base due to issue of additional 1320000 shares of INR 10 each amounting to INR 1.32 crore in FY18 and accretion of profit to the net worth. However, capital structure continues to remain leveraged. Further, the debt coverage indicators moderated with total debt to GCA of 19.17x as on March 31, 2018 (vis-Ö-vis 18.71x as on March 31, 2017) and interest coverage of 1.56x as on March 31, 2018 (vis-Ö-vis 1.55x as on March 31, 2017). Working capital intensive nature of operations: Working capital cycle of REPL improved in FY18 mainly on account of improvement in collection period to 53 days in FY18 from 185 days in FY17 due to early recovery of payment from its clients and improvement in inventory period to 21 days in FY18 from 57 days in FY17. Further, company has also made early payment to its suppliers. Therefore, operations remained moderately working capital intensive and average utilization of working capital limits (of INR 8.00 crore) of 50% for the past 12 months ended May 2018. Moderate liquidity position: Liquidity position of the company remained moderate with current ratio of 2.21x in FY18 vis-Ö-vis 1.10x and quick ratio 1.13x in FY18 vis-Ö-vis 0.52x in FY17. Further free cash and bank balance remained low at 0.37 crore as on March 31, 2018 vis-Ö-vis INR 1.16 crore as on March 31, 2018. Project execution and funding risk as debt is yet to be tied up: Company has undertaken a capacity enhancement project wherein company is planning to buy advanced machinery in the existing plant. Machineries are expected to be installed till October 2019. Total estimated cost of the project is INR 20.00 crore out of which INR 4.65 crore will be funded through promoters' own funds and rest INR 15.35 crore will be funded through term loan from bank however debt is not yet tied up. As on December 27, 2018, company has not incurred any expenses towards the project. Thus going forward REPL's ability to complete the project in timely manner without any cost and time overrun shall be critical from credit perspective. Susceptibility to fluctuation in prices of raw materials: The raw material is the major cost driver (constituting about 82% of total cost of sales in FY18) and the prices of the same are volatile in nature therefore cost base remains exposed to any adverse price fluctuations. The key raw material for REPL is aluminum whose prices are volatile in nature on account of demand and supply factor and exposure to the cyclicality inherent in the metals and mining industry as well. Thus, the fluctuation in the prices of raw materials shall be the critical factor as it can affect the production capacity to manufacture and export its' products too. Presence in highly fragmented and cyclical nature of metal industry: REPL operates in highly fragmented industry marked by the presence of organized as well unorganized segment. Furthermore, advancement in quality of metal and steel industry is leading to affect the operation. Increasing advancement and utilization of aluminum products pertaining to end-use industry shall be the significant portion. Key rating Strengths Experienced and resourceful promoters: REPL is managed by Jain family, with the promoter-director Mr. Suresh Jain having more than 30 years of experience in metal industry. Furthermore, the directors are assisted by experienced management team to carry out day-to-day operations. Further, promoters have infused additional 1320000 shares of INR 10 each amounting to INR 1.32 crore in FY18 to support its working capital requirement. Established relationship with clients: With the vast experience of promoters in the metal industry, they have developed established relation in the market with various customers. The customer profile includes mainly from domestic level, further, it also deals with various suppliers from domestic level. With the established relation with various domestic customers and suppliers, REPL gets benefit out of it. Ramco Extrusion Private Limited (REPL), Incorporated in February 2003 by Mr. Suresh Jain and family, engaged into manufacturing & trading of aluminum extrusion products (includes alloying, tooling, finishing and assembling) with installed capacity of 600 MTPA. REPL's main products include aluminum-sections and profiles which produce up to 200mm width for 'solid-profile' and up to 160mm 'CCD hollow-profile'. REPL has its factory unit located at MIDC, Murbad, Thane with having 6303 Sq. Ft area. REAL VALUE: CARE Maintains B+ Rating in Not Cooperating Category ---------------------------------------------------------------- CARE has sought confirmation from Real Value Ventures Private Limited on repayment and no confirmation on the same has been received till date. In line with SEBI circular No.SEBI/HO/MIRSD/MIRSD4/CIR/2017/71 dated June 30, 2017 regarding monitoring and review of ratings by CRAs, following is the list of debt instruments where no confirmation has been received from the issuer or debenture trustee on the payment status: Amount Facilities (INR crore) Ratings ---------- ----------- ------- Non-Convertible 140 CARE B+; Stable; ISSUER NOT Debenture COOPERATING* Non-Convertible 29 CARE B+; Stable; ISSUER NOT Debenture COOPERATING* Non-Convertible 27 CARE B+; Stable; ISSUER NOT Debenture COOPERATING* Non-Convertible 16 CARE B+; Stable; ISSUER NOT Debenture COOPERATING* *Issuer did not cooperate; Based on best available information The above instruments have been identified as "potential defaults" in line with the above mentioned SEBI guidelines and CARE shall review the ratings as and when any information on the said instrument is available. REGALIA JEWELS: CARE Migrates 'B' Rating to Not Cooperating ----------------------------------------------------------- CARE Ratings has migrated the rating on bank facility of Regalia Jewels Private Limited (RJP) to Issuer Not Cooperating category. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long-term Bank 6.50 CARE B; Stable Issuer Not Facilities Cooperating; based on best available information Detailed Rationale & Key Rating Drivers CARE has been seeking information from RJP to monitor the rating(s) vide e-mail communications/letters dated December 4, 2018, November 12, 2018, & October 25, 2018, and numerous phone calls. However, despite CARE's repeated requests, the company has not provided the requisite information for monitoring the ratings. In line with the extant SEBI guidelines, CARE has reviewed the rating on the basis of the publicly available information which however, in CARE's opinion is not sufficient to arrive at a fair rating. The rating on Regalia Jewels Private Limited facilities will now be denoted as CARE B; Stable; 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. The ratings of RJPL are continue to be constrained by its small scale of operations with low net worth base, low profitability margins, leveraged capital structure and elongated inventory holding period. The rating is further continue to be constrained by vulnerability of margins to gold price fluctuations and competition from various organized or unorganized players and unfavorable supply outlook. The rating, however continue to draws comfort from experienced promoters and long track record of operations and favorable location of showroom. Detailed description of the key rating drivers At the time of last rating on August 10, 2017, the following were the rating weaknesses and strengths. Credit Risk Assessment Key Rating Weakness Small scale of operations with low net worth base: The scale of operations has remained low marked by a total operating income and gross cash accruals of INR10.47 crore and INR0.15 crore, respectively, during FY17. Furthermore, the company's net worth base was relatively small at INR1.58 crore as on March 31, 2017. The small scale limits the company's financial flexibility in times of stress and deprives it from scale benefits. Further, the TOI has declined significantly from INR33.48 crore in FY16 to INR10.47 in FY17 on account of discontinuation of manufacturing business. Low profitability margins, leveraged capital structure and weak coverage indicators: The profitability margins have been historically on the lower side owing to intense market competition given the highly fragmented nature of the industry. The profitability margins of the company have been fluctuating during the past three financial years (FY15-FY17) on account of change in product mix. Further, the capital structure of the company stood leveraged marked by overall gearing of 1.39x as on March 31, 2017 due to low net worth base and high dependence on external borrowings to meet working capital borrowings. The debt protection metrics remained weak for the past three financial years owing to low profitability as against debt levels. The Interest coverage and total debt to GCA stood at 1.44x and 14.56x in FY17 (Provisional). Elongated inventory holding period: Being a jewelry retailer, it is critical for the company to provide a wide range designs to its customers and cater the immediate demand. This results in significant finished goods inventory leading to elongated inventory holding to carry business operations smoothly (inventory days of 220 days in FY17). Being in a retailing business, the company sells mainly on cash basis however few customers given credit period of around a week. Furthermore, the company purchases gold on cash or on advance basis , however gems and diamonds are generally bought on credit of around 40-50 days resulting in an average creditors remained at around 43 days. Vulnerability of margins to gold price fluctuations: The prices of gold have experienced high volatility in the past one year. Therefore, any adverse change in prices of the same is likely to have a significant impact on margins of the players in the G&J industry. However, the vast experience of the promoters of RJP coupled with their policy of inventory replenishment model helps it in managing this risk to some extent. Further, the high price gold can also have an adverse impact on the demand for jewellery, thereby exposing the company to risk of decline in sales volume. Competition from various organized or unorganized players and unfavorable supply outlook: The company operates in the Gems & Jewelry (G&J) industry, which is a fragmented industry with a high level of competition from both the organized and unorganized sector. Key Rating Strengths Experienced promoters and long track record of operations: The directors are actively involved in day-to-day operations of the business. Mrs. Poonam Verma, Mr. Sumit Verma and Mr. Shobhit Verma have their experience in the field of gems and jewelley industry though the company has its associate concerns. Due to their longstanding industry presence, the directors have been able to establish their own reputation. Favorable location of showroom: RJP has its showroom located in Karol Bagh (Central Delhi) and Gurgaon (Gold Sukh Building) the market is known for jewellery in New Delhi and Gurgaon respectively). The store is located in prime area which ensures the higher probability of footfall in its showroom, thereby, ensuring a good customer base for the company. Regalia Jewels Private Limited (RJP) was incorporated in 2005. The company is currently being managed by the Mrs. Pushpalata Verma, Mr. Sumit Verma and Mr. Shobhit Verma. The company is engaged in retailing of gold jewellery and diamond studded gold jewellery (necklaces, earrings, rings, pendants and bangles). SHREE RAMKRISHNA: CARE Reaffirms B+ Rating on INR9.50cr Loan ------------------------------------------------------------ CARE Ratings reaffirmed ratings on certain bank facilities of Shree Ramkrishna Oil Industries (SROI), as: Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long-term Bank Facilities 9.50 CARE B+; Stable Reaffirmed Detailed rationale The rating assigned to the bank facilities of SROI continues to remain constrained on account of its moderate scale of operations with thin profitability during FY18 (refers to the period April 1 to March 31), weak debt coverage indicators and moderate liquidity. Further, the rating also continues to remain constrained owing to its partnership nature of constitution, susceptibility of operating margins to cotton price fluctuations, its presence in highly fragmented, seasonal and regulated cotton industry with limited value addition. The rating, however, continues to derive benefit from vast experience of promoters and locational advantage in terms of proximity to the cotton-growing region in Gujarat. The rating also factors in improvement in capital structure. The ability of SROI to increase its scale of operations and improve its overall financial risk profile by improving its profitability debt coverage indicators along with efficient working capital management would remain the key rating sensitivities. Detailed description of the key rating drivers Key Rating Weaknesses Moderate Scale of operation along with thin profit margins: SROI has reported growth in its scale of operations marked by its Total Operating Income (TOI) by 14.08% but remained moderate at INR 70.23 crore during FY18 as against INR61.56 crore during FY17. Further, the profit margin of SROI remained thin marked by PBILDT and PAT margins which stood at 0.63% and 0.04% respectively during FY18 as against 1.21% and 0.03% respectively during FY17 owing to its low value additive nature of business with presence in highly competitive industry. Weak debt coverage indicators: As a result of its thin profitability, the debt coverage indicators remained weak marked by high ratio of total debt to GCA of 25.74x during FY18 as against 45.81x during FY17. Further interest coverage ratio also remained modest at 1.67x during FY18 as against 1.34x during FY17. Moderate liquidity: As on March 31, 2018, liquidity has been improved but stood moderate marked by current ratio of 2.49x as against 1.56x as on March 31, 2017. Working capital cycle also remained moderate at 45days during FY18. Further, average utilization of its working capital limit during past one year ended November 2018 remained moderate at 60%, however peak utilisation remains 60%. Cash flow from operations stood positive at INR 1.63 crore as against negative INR 0.94 crore during FY17, however are modest. Further, cash and bank balance stood low at INR 1.14 crore as on March 31, 2018. Partnership nature of constitution: The constitution as a partnership firm restricts SROI's overall financial flexibility in terms of limited access to external funds for any future expansion plans. Further, there is inherent risk of possibility of withdrawal of capital and dissolution of the firm in case of death/insolvency of partner. Susceptibility of operating margins to cotton price fluctuations: The profitability of SROI is exposed to fluctuations in raw material prices, which is 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 firm. Presence in the highly fragmented, seasonal and regulated cotton industry with limited value addition: SROI is engaged in the ginning and pressing of cotton which involves very limited value addition and hence results in thin profitability SROI operates in industry characterized by low entry barriers, high fragmentation, the presence of a large number of players in the organized and unorganized sector and very low bargaining power against its customers puts pressure on the profitability margins. Further, cotton being a seasonal crop as it is available mainly from November to February results into a higher inventory holding period for the business. Furthermore, the cotton prices in India are highly regulated by government through MSP (Minimum Support Price) fixed by government. Any adverse change in government policy may also impact the prices of raw cotton in domestic market and could result in lower realizations and profit. Key rating strengths Experienced partners: Mr. Bharatbhai Patel, Mr. Manjibhai Narshibhai Patel, Mr. Bhudarbhai Shankarbhai Patel and Mr. Laljibhai Chaturdas Patel are key partners of SROI, who holds more than a decade of experience in the cotton industry and jointly look after overall operation of the firm. Proximity to the cotton-producing region of Gujarat: The processing facility of SROI is located at Kadi (Gujarat). Gujarat is one of the major cotton producing states hence, SROI's presence in cotton producing region results in benefit derived from lower logistic expenditure (both on transportation and storage), easy availability and procurement of raw materials at effective prices and consistent demand for finished goods resulting in easy access to customer base. Improvement in capital structure: On the back of decrease in total debt level as a consequence of lower utilization of its working capital borrowing along with increase in tangible net worth level as a result of infusion of capital by partners during the year, capital structure has improved and remained comfortable marked by overall gearing ratio of 0.68x as on March 31, 2018 as against 1.63x as on March 31, 2017. Kadi (Gujarat) based SROI was established in the year 1986 as a partnership firm by 11 partners with Mr. Bharatbhai Bhudarbhai Patel, Mr. Manjibhai Narshibhai Patel, Mr. Bhudarbhai Shankarbhai Patel and Mr. Laljibhai Chaturdas Patel being the key partners who are actively involved in business operations. SROI is engaged in cotton ginning & pressing and seed crushing with installed capacity of 52.48 MT of cotton bales per day, 49.5 MT of oil cake per day and 7.00 MT of cotton seed wash oil per day as on March 31, 2018. SOHAM COLD: CARE Reaffirms B+ Rating on INR5.06cr LT Loan --------------------------------------------------------- CARE Ratings reaffirmed ratings on certain bank facilities of Soham Cold Storage and Chilling Plants (SCS), as: Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long-term Bank Facilities 5.06 CARE B+; Stable Reaffirmed Detailed Rationale & Key Rating Drivers The rating assigned to the bank facilities of SCS continues to remain constrained on account of its short track record and small scale of operations, net losses, leveraged capital structure and weak coverage indicators. The ratings are further constrained on account of constitution as a partnership firm, fragmented nature of industry due to competitive nature of business, business prospects depends on vagaries of nature and seasonality of business along with the risk of delinquency in loans extended to farmers. However, the ratings derive strengths from experienced partners and location advantage with proximity to potato growing region of Uttar Pradesh and eligibility of capital subsidy from Central as well as state Government. The ability of SCS to increase its scale of operations while improving it's profitability margins and capital structure would remain the key rating sensitivities. Detailed description of the key rating drivers Key Rating Weaknesses Short track record and small scale of operations: The company commenced operations in March 2017 and has short of track record in this industry as compared to other established players. FY18 would be its first full year of operations. The scale of operations of the company stood small as marked by total operating income and gross cash accruals of INR 1.30 crore and INR 0.28 crore respectively in FY18( refers to the period April 1 to March 31). The small scale deprives the company of scale benefits and restricts flexibility in times of stress. Further, SCS has achieved a total operating income of around INR1.00 crore in 8MFY19 (refers to period starting from April 01 to November 30; based on provisional results). Net losses, leveraged capital structure and weak coverage indicators: The PBILDT margin of the company stood moderate owing to service sector undertaking with only fixed cost, however high depreciation and interest cost resulted in net losses in FY18. The capital structure of the firm stood leveraged owing to high dependence on the external borrowing to meet the working capital requirements coupled with CAPEX undertaken in the past. The overall gearing ratio stood at 6.07x as on March 31, 2018. Owing to high total debt and interest cost the coverage indicators stood weak as marked by interest coverage and total debt to GCA of 1.86x and 23.84x respectively for FY18. Constitution of the entity as a partnership firm: SCS, being a partnership firm, is exposed to inherent risk of partners' capital being withdrawn at time of personal contingency, and firm being dissolved upon the death/retirement/insolvency of partners. Further, partnership firms have restricted access to external borrowing as credit worthiness of partners would be key factors affecting credit decision for lenders. Fragmented nature of industry coupled with competitive nature of business: SCS operates in the cold storage services industry which is highly fragmented with presence of numerous independent small-scale enterprises owing to low entry barriers leading to high level of competition in the segment. Furthermore, being engaged in to cold storage service industry for fruits and vegetables, SCS requires storing fruits and vegetables in the season itself for future off-season sale which allow SCS to keep the profit margin moderately high. However, higher profit margin attracts new players to enter in the industry and thereby competition is bound to increase in future which may expose SCS to lower down its profit margin in future. Risk of delinquency in loans extended to farmers: As a part of the government's initiative to support agriculture, banks extend financial assistance to farmers through cold storages against the pledge of cold storage receipts. In accordance with the same, SCS provides interest bearing advances to farmers. Working capital limits under potato on lending to farmers scheme from banks are used to extend advances to farmers, which are routed to the farmers through SCS. Before the close of the season in November, the farmers are required to pay their outstanding dues, including repayment of the loan taken, along with the interest. In view of this, there exists a risk of delinquency in loans extended to the farmers, in case of downward correction in the potato prices being an agro commodity. Key Rating Strengths Diversified experienced partners albeit no relevant experience in the storage service industry: SCS has been established by two partners' viz. Mr. Pravesh Gupta and Mrs Manju Gupta. Mr. Pravesh Gupta has 28 years of experience in jewellery business through his association with Soham Jeweller. Mr. Pravesh Gupta is looking after overall operations of the entity. Overall supervision and control will be done by both the partners collectively and technically qualified and well experienced operators will assist them. Although, partners possess long experience in the trading segment, they do not have any relevant experience with respect to cold storage facilities and controlled environment services. Hence, their ability to manage the operations of SCS is yet to be ascertained. Proximity to potato growing region of Uttar Pradesh: Uttar Pradesh is the largest producer of potato in India. The potato belt in Uttar Pradesh stretches from Agra in the west to Kanpur in central part of the state. The quality of potato produced in vast farms in Agra, Firozabad, Aligarh, Hathras and Mathura districts is considered to be the best in terms of size and robustness. The cold storage facility of the firm is located in potato growing belt of Uttar Pradesh having large network of potato growers, thereby making it suitable for the farmers in terms of transportation and connectivity. The harvesting of potato is done in February and March. Hence, SCS's presence in potato producing region results in benefit of consistent demand from potato chips manufacturers and farmers; providing sustainable and clear revenue visibility. Capital investment subsidy from the Central and State government: As per the revised policy of National Horticulture Mission (NHM), proposed cold storage facility of SCS will be eligible for credit linked back-ended subsidy at 35% of the capital cost of project. Further, SCS is also eligible for 7.5% electricity duty concession for ten years from Government of Uttar-Pradesh. SCS was established in July 2016 by Mr. Pravesh Gupta and his wife Mrs. Manju Gupta. SCS was established to provide cold storage facilities at Agra through 3 chambers with total installed capacity of 80631 quintals of potatoes per annum as on December 31, 2018. The main objective of setting up SCS is to preserve potatoes for longer duration. The plant is located in Agra which contributes significantly to agricultural production of the state. TORO PROCESSORS: CARE Migrates D Rating to Not Cooperating ---------------------------------------------------------- CARE Ratings has migrated the rating on bank facility of Toro Processors India Private Limited (TPIPL) to Issuer Not Cooperating category. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long term Bank 15.00 CARE D; Issuer Not Cooperating; Facilities Based on best available information. Detailed Rationale and key rating drivers CARE has been seeking information from TPIPL to monitor the ratings vide e-mail communications/letters dated October 9, 2018, December 3, 2018, December 7, 2018 and numerous phone calls. However, despite CARE's repeated requests, the company has not provided the requisite information for monitoring the ratings. In line with the extant SEBI guidelines, CARE has reviewed the rating on the basis of the publicly available information which however, in CARE's opinion is not sufficient to arrive at a fair rating. The rating on TPIPL's bank facilities will now be denoted as CARE D; 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 in December 20, 2017 the following were the rating strengths and weaknesses. Key Rating Weaknesses Ongoing delay in debt servicing due to stressed liquidity position: There is ongoing delay in servicing of term loan interest and principal for more than two months. The liquidity position of the company is also seen to be very weak marked by below unity current ratio at 0.07x as on March 31, 2017 due to higher current liabilities along with the presence of current portion of long term debts in FY17. As the company receives delayed collections from its customers owing to its low bargaining power as compared to its customers, it stretches its creditors. TPIPL was incorporated in April 2011 for setting up a manufacturing and fabrication of heavy steel aggregates plant. The commercial operation of the company started in February 2017 and the plant is located at Kharagpur, West Bengal with an installed capacity of 24000 metric tonnes per annum. The company caters to the requirements of reputed clients like Indian Oil Corporation Limited, Larsen and Toubro Limited, etc. ULTIMA SWITCHGEARS: Ind-Ra Affirms BB- LT Rating, Outlook Stable ---------------------------------------------------------------- India Ratings and Research (Ind-Ra) has affirmed Ultima Switchgears Limited's (USL) Long-Term Issuer Rating at 'IND BB-'. The Outlook is Stable. The instrument-wise rating actions are: -- INR90 mil. (increased from INR50 mil.) Non-fund-based working capital limit affirmed with IND A4+ rating; and -- INR65 mil. (reduced from INR100 mil.) Fund-based working capital limit affirmed with IND BB-/Stable/IND A4+ rating. KEY RATING DRIVERS The affirmation reflects USL's continued small scale of operations, with revenues declining to INR249.11 million (FY17: INR262.3 million) due to GST implementation. During April- December 2018, the company has already booked revenue of around INR210 million. The ratings are constrained by the company's modest operating profitability and weak credit metrics, because of intense competition, low value addition in operations and delays in receivables from government projects, leading to a long working capital cycle and high debt. EBITDA margins fell to 7.01% in FY18 (FY17: 7.62%), with ROCE of 6%, because of an increase in the administrative expenses. Interest coverage (operating EBITDA/gross interest expense) declined to 1.32x in FY18 (FY17: 1.58x), because of the decline in the operating profitability and revenue. The net leverage (total adjusted net debt/operating EBITDA) declined to 3.93x in FY18 (FY17: 2.70x), due to an increase in debt. However, Ind-Ra expects an improvement in the credit metrics in FY19, on account of an increase in EBITDA, backed by a significant increase in top line. Moreover, the liquidity position of the company is tight, as evident from around 97% utilization of its fund-based limit during the 12 months ended November 2018. Also, the cash flow from operations of the company turned negative in FY18 at INR4.09 million (FY17: INR54.81 million). The ratings, however, are supported by the promoter's experience of more than two decades in the electronics business. RATING SENSITIVITIES Positive: Substantial improvement in revenue and working capital cycle leading to improvement in the overall credit metrics could lead to a positive rating action. Negative: A Decline in the operating profitability and/or further deterioration in the working capital cycle leading to deterioration in the overall credit metrics could lead to a negative rating action. COMPANY PROFILE Incorporated in 1997, USL manufactures electrical components such as electrical control panels and boards, switchgears and HG fuses up to 132kV. The company has manufacturing plants in Roorkee and Noida. The company also executes EPC substation projects for distribution companies. VIKAS TECHNOPLAST: Ind-Ra Lowers Long Term Issuer Rating to 'D' --------------------------------------------------------------- India Ratings and Research (Ind-Ra) has downgraded Vikas Technoplast Pvt Ltd.'s (VTPL) Long-Term Issuer Rating to 'IND D' from 'IND BB- (ISSUER NOT COOPERATING)'. The instrument-wise rating actions are: -- Fund-based limits (Long-term/Short-term) downgraded with IND D rating; and -- INR10.28 mil. (reduced from INR25.2 mil.) Term loan (Long- term) due on September 2021 downgraded with IND D rating. KEY RATING DRIVERS The downgrade reflects SFPL's stressed liquidity position leading to delays in debt servicing during the three months ended November 2018. RATING SENSITIVITIES Positive: Timely debt servicing for at least three consecutive months could result in a positive rating action. COMPANY PROFILE Incorporated in 2013, VTPL manufactures plastic bottles, pet jars, preforms, molds and other plastic products used for packaging and storage purposes. VINAYAK AUTOLINK: CRISIL Hikes Rating on INR12cr Loan to B- ----------------------------------------------------------- CRISIL has upgraded its ratings on bank facilities of Vinayak Autolink Private Limited (VAPL) to 'CRISIL B-/Stable' from 'CRISIL D'. Amount Facilities (INR Crore) Ratings ---------- ----------- ------- Inventory Funding 12 CRISIL B-/Stable (Upgraded Facility from 'CRISIL D') The rating upgrade reflects track record of the VAPL in meeting interest and repayment obligation owing to improvement working capital cycle. VAPL has recorded sales of around Rs.78 crore with operating margins of over 4% up to November 2018. Working capital cycle has improved due to reduction in inventory days to around 50 days as on 30th November 2018 as compared to 90 days as on 31st March 2018. CRISIL expects this improvement in working capital cycle to sustain over medium term. Ratings continue to reflect a weak financial risk profile and intense competition. These rating weaknesses are partially offset by benefits that the company derives from extensive experience of its promoters in the automobile dealership business, and their established relations with the principal, Ford India Pvt Ltd (Ford India). Key Rating Drivers & Detailed Description Weakness * Weak financial risk profile: Financial risk profile is marked by modest net worth and high TOL/TNW and weak debt protection metrics. * Exposure to intense competition: Business risk profile is constrained by intense competition in the automobile dealership business. Also, the company does not have an exclusive dealership agreement with Ford India, which increases the risk of competition as the principal could appoint any new dealer in the same area. Strength * Promoters' extensive industry experience and established relations with the principal: The company's established infrastructure, promoter's extensive experience and long-standing association with Ford India has helped in gradually increasing its scale of operations. Outlook: Stable CRISIL believes VAPL will continue to benefit from the experience of its promoters. The outlook may be revised to 'Positive' if substantial and sustained improvement in scale of operations, cash accrual, and working capital management strengthens the credit metrics. The outlook may be revised to 'Negative' if low operating income or cash accrual, a stretched working capital cycle, or any large capital expenditure or further advances to associate concerns weakens the financial risk profile, particularly liquidity. Liquidity The liquidity position is weak with high bank line utilization for the past 12 months ending November' 2018. The bank line utilizations are expected to remain high owing to working capital intensive operations. Further, the net cash accruals are tightly matched against the repayment obligations. VAPL, incorporated in March 2008, is an authorised dealer for the passenger vehicles of Ford India in Indore. The promoters have extensive experience in the automobile dealership business. The company has one 3S (sales, spares and services) outlet, one 2S (sales and spares) and two workshops. Ms Vandana Sanghi and Mr Santosh Korde are the directors. ===================== P H I L I P P I N E S ===================== COUNTRYSIDE COOPERATIVE: Deposit Claims Deadline Set for Jan. 14 ---------------------------------------------------------------- The Philippine Deposit Insurance Corporation (PDIC) urged depositors of the closed Countryside Cooperative Rural Bank of Batangas to file their deposit insurance claims on or before the last day for filing of claims for insured deposits on January 14, 2019 either through mail addressed to the PDIC Public Assistance Department, 6th Floor, SSS Bldg., 6782 Ayala Avenue corner V.A. Rufino Street, Makati City, or personally during business hours at the PDIC Public Assistance Center, 3rd Floor, SSS Bldg., 6782 Ayala Avenue corner V.A. Rufino Street, Makati City. The PDIC Charter provides that depositors have until two years from bank takeover to file their deposit insurance claims. Countryside Cooperative Rural Bank of Batangas was ordered closed by the Monetary Board (MB) of the Bangko Sentral ng Pilipinas on January 12, 2017. According to PDIC, deposit insurance claims for 5,544 deposit accounts with aggregate insured deposits amounting to PHP5.1 million have yet to be filed by depositors. Data show that as of November 30, 2018, PDIC had paid depositors of the closed Countryside Cooperative Rural Bank of Batangas the total amount of PHP144.5 million, corresponding to 96.4% of the bank's total insured deposits amounting to PHP149.9 million. In filing claims personally, depositors are required to submit their original evidence of deposit and present one (1) valid photo-bearing ID with signature of the depositor. It is recommended, however, to bring at least two (2) valid IDs in case of discrepancies in signature. Depositors may also file claims through mail and enclose their original evidence of deposit and photocopy of one (1) valid photo-bearing ID with signature together with a duly accomplished Claim Form which can be downloaded from the PDIC website, www.pdic.gov.ph. Depositors who are below 18 years old should submit either a photocopy of their Birth Certificate issued by the Philippine Statistics Authority (PSA) or a duly certified copy issued by the Local Civil Registrar. Representatives of claimants are required to submit an original copy of a notarized Special Power of Attorney of the depositor or parent of a minor depositor. The Special Power of Attorney template may be downloaded from the PDIC website. Depositors who have been notified of their documentary deficiencies through official letters from PDIC are requested to comply with the indicated requirements. The procedures and requirements for the filing of deposit insurance claims are posted in the PDIC website, www.pdic.gov.ph. Meanwhile, depositors with balances of more than the maximum deposit insurance coverage (MDIC) of PHP500,000 who were not able to file their claims on April 3, 2017, the deadline earlier set, should file their claims with the Regional Trial Court, Branch 2, Batangas City where the Petition for Assistance in the Liquidation (PAL) of Countryside Cooperative Rural Bank of Batangas is pending under Special Proceedings No. 17-50. Likewise, depositors who will not be able to file their deposit insurance claims on January 14, 2019 should file their claims with said Liquidation Court. Payment of these claims shall be subject to availability of assets of the closed bank, legal priority and approval of the Liquidation Court. Depositors who have outstanding loans or payables to the bank will be referred to the duly designated Loans Officer prior to the settlement of their deposit insurance claims. For more information, depositors and depositor-borrowers may contact the Public Assistance Department at telephone numbers (02) 841-4630 to 31, or e-mail at pad@pdic.gov.ph. Those outside Metro Manila may call the PDIC toll free at 1-800-1-888-PDIC or 1-800-1-888- 7342. Inquiries may also be sent as private message at Facebook through www.facebook.com/OfficialPDIC. ================= S I N G A P O R E ================= COASTAL OIL: At Least 10 Banks Face HK$3 Billion Loss ----------------------------------------------------- The Standard reports that local banks are likely to suffer losses linked to the closure of Coastal Oil Singapore, according to reports. The closure of Coastal Oil Singapore may affect at least 10 banks in both Singapore and Hong Kong for a total of HK$3 billion, the report says. A unit of Coastal Oil, Coastal Oil Singapore entered liquidation in December due to the sharp plunge in oil prices, the Standard notes. According to the report, DBS Bank (Hong Kong) and Standard Chartered Hong Kong were among other lenders to the related companies, and the two banks have filed in the local high court for reclaiming the funds. The Standard relates that DBS Bank (Hong Kong) filed to reclaim US$30.07 million (HK$234 million) in loans and interest from Coastal Oil Singapore's guarantors, including Coastal Oil (HK). Standard Chartered Hong Kong last month also requested the Coastal Oil Singapore's guarantor to pay off US$15.73 million (HK$122 million) loans and related interests. It is reported that 60 percent of the company's loans were offered by Singapore's banks, the Standard notes. ********* Tuesday's edition of the TCR-AP delivers a list of indicative prices for bond issues that reportedly trade well below par. Prices are obtained by TCR-AP editors from a variety of outside sources during the prior week we think are reliable. Those sources may not, however, be complete or accurate. The Tuesday Bond Pricing table is compiled on the Friday prior to publication. Prices reported are not intended to reflect actual trades. Prices for actual trades are probably different. Our objective is to share information, not make markets in publicly traded securities. Nothing in the TCR-AP constitutes an offer or solicitation to buy or sell any security of any kind. It is likely that some entity affiliated with a TCR-AP editor holds some position in the issuers' public debt and equity securities about which we report. A list of Meetings, Conferences and Seminars appears in each Wednesday's edition of the TCR-AP. Submissions about insolvency- related conferences are encouraged. Send announcements to conferences@bankrupt.com Friday's edition of the TCR-AP features a list of companies with insolvent balance sheets obtained by our editors based on the latest balance sheets publicly available a day prior to publication. At first glance, this list may look like the definitive compilation of stocks that are ideal to sell short. Don't be fooled. Assets, for example, reported at historical cost net of depreciation may understate the true value of a firm's assets. A company may establish reserves on its balance sheet for liabilities that may never materialize. The prices at which equity securities trade in public market are determined by more than a balance sheet solvency test. ********* S U B S C R I P T I O N I N F O R M A T I O N Troubled Company Reporter-Asia Pacific is a daily newsletter co- published by Bankruptcy Creditors' Service, Inc., Fairless Hills, Pennsylvania, USA, and Beard Group, Inc., Washington, D.C., USA. Marites O. Claro, Joy A. Agravante, Rousel Elaine T. Fernandez, Julie Anne L. Toledo, Ivy B. Magdadaro and Peter A. Chapman, Editors. Copyright 2019. All rights reserved. ISSN: 1520-9482. This material is copyrighted and any commercial use, resale or publication in any form (including e-mail forwarding, electronic re-mailing and photocopying) is strictly prohibited without prior written permission of the publishers. Information contained herein is obtained from sources believed to be reliable, but is not guaranteed. TCR-AP subscription rate is US$775 for 6 months delivered via e- mail. Additional e-mail subscriptions for members of the same firm for the term of the initial subscription or balance thereof are US$25 each. For subscription information, contact Peter Chapman at 215-945-7000. *** End of Transmission ***