/raid1/www/Hosts/bankrupt/TCRAP_Public/200717.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, July 17, 2020, Vol. 23, No. 143
Headlines
A U S T R A L I A
CONEKT AUSTRALIA: Second Creditors' Meeting Set for July 23
EQUESTRIAN AUSTRALIA: Members Vote for More Control of Sport
FIRSTMAC MORTGAGE 2-2020: S&P Assigns BB Rating on Cl. E Notes
GOLDEN CARLINGFORD: First Creditors' Meeting Set for July 23
HOUSE SPAGHETTI: First Creditors' Meeting Set for July 27
MCWILLIAM'S WINES: Creditors to Vote on Private Equity Deal
SWEENEY (YARRAVILLE): First Creditors' Meeting Set for July 27
TELEGRAPH POINT: Second Creditors' Meeting Set for July 23
TM LEWIN: Australian Business Owes AUD10MM, Administrators Say
TOMI-SASHA HOLDINGS: First Creditors' Meeting Set for July 24
TORO GROUP: Second Creditors' Meeting Set for July 23
C H I N A
GREENLAND GLOBAL: Moody's Rates New Senior Unsec. USD Notes 'Ba2'
TAHOE GROUP: Warns Creditors It Will Default Again
YANZHOU COAL: Fitch Puts 'BB-' LT IDR on Watch Positive
I N D I A
ASK HOME: CARE Keeps D Debt Ratings in Not Cooperating Category
AYKA MOULD: CARE Keeps D Debt Ratings in Not Cooperating Category
BALWAN POULTRY: CARE Keeps D on INR6cr Debt in Not Cooperating
BHORUKA POWER: CARE Keeps D Debt Ratings in Not Cooperating
DEWAN HOUSING: ED Files Supplementary Charge Sheet vs. Promoters
ESKAY SILK: CARE Keeps D Debt Ratings in Not Cooperating
GHANSHYAM DAS: CARE Keeps D on INR11.85cr Debt in Not Cooperating
GUPTA EXIM: CARE Keeps D Debt Ratings in Not Cooperating
J P AND COMPANY: CARE Lowers Rating on INR12cr LT Loan to C
JHARKHAND ROAD: CARE Hikes Rating on INR1,573.13cr Debentures to C
KALPANA SHIVHARE: CARE Lowers Rating on INR3.50cr Loan to C
KHUSHIYA INDUSTRIES: CARE Keeps D on INR20cr Debt in NonCooperating
LAKSHMI PRECISION: CARE Keeps D Debt Ratings in Not Cooperating
LATA EXPORTS: CARE Keeps D Debt Ratings in Not Cooperating
NAKKHEERAN PUBLICATIONS: CARE Keeps D Ratings in Not Cooperating
NEEL KRISHNA: CARE Keeps D on INR10cr Loans in Not Cooperating
NEW PRINTS: CARE Keeps D on INR10cr Bank Loans in Not Cooperating
PANAMA AGRICULTURE: CARE Keeps D on INR1cr Debt in Not Cooperating
PATE FUTURE: CARE Keeps D on INR45cr Debt in Not Cooperating
PINAKIN PLASTOFORMING: CARE Keeps D Debt Ratings in Not Cooperating
PRIMAFLEX: CARE Keeps D on INR8.30cr Debt in Not Cooperating
PV KNIT FASHIONS: CARE Raises Rating on INR5.05cr LT Loan to C
RAHUL ELECTRONIC: CARE Lowers Rating on INR6cr Bank Loans to C
RRB ENERGY: CARE Keeps D on INR135cr Loans in Not Cooperating
S.G. POLYPLAST: CARE Lowers Rating on INR15cr LT Loan to 'D'
S.R. INDUSTRIES: CARE Keeps D Debt Ratings in Not Cooperating
SAVITRIDEVI INDUSTRIES: CARE Keeps D Debt Rating in Not Cooperating
SHIKHAR MICROFINANCE: CARE Cuts Rating on INR50cr LT Loan to D
SKYPOINT MULTITRADE: CARE Keeps D Debt Ratings in Not Cooperating
VANI ORGANICS: CARE Lowers Rating on INR6.50cr LT Loan to C
WHITE HOUSE: CARE Keeps D on INR14cr Loans in Not Cooperating
[*] INDIA: Plan to Help Small Businesses Does Little to Save Them
M A L A Y S I A
BERJAYA MEDIA: To Be Delisted From Bursa on July 17
KHEE SAN: Triggers PN17 Criteria After Defaulting on Loans
P A P U A N E W G U I N E A
BANK OF SOUTH PACIFIC: S&P Withdraws 'B-/B' Issuer Credit Ratings
S I N G A P O R E
EPICENTRE HOLDINGS: To Sell SGX Listing Status for SGD3 Million
T H A I L A N D
THAI AIRWAYS: To Submit Partial Rehabilitation Plan in August
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A U S T R A L I A
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CONEKT AUSTRALIA: Second Creditors' Meeting Set for July 23
-----------------------------------------------------------
A second meeting of creditors in the proceedings of Conekt
Australia Pty Ltd as trustee for Conekt Unit Trust has been set for
July 23, 2020, at 11:00 a.m. via teleconference.
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 July 22, 2020, at 4:00 p.m.
Mark Robinson and Riad Tayeh of de Vries Tayeh were appointed as
administrators of Conekt Australia on June 18, 2020.
EQUESTRIAN AUSTRALIA: Members Vote for More Control of Sport
------------------------------------------------------------
Roy Masters at The Sydney Morning Herald reports that a historic
vote for constitutional reform at Equestrian Australia could give
members more control of the sport, which has been troubled by state
conflicts and a string of resignations.
An online creditors meeting on July 14 accepted a recommendation
from the governing body's administrators, KordaMentha, that it
adopt a plan aimed at regaining Sport Australia funding and
maintaining Olympic affiliation so it can compete at next year's
Tokyo Games, SMH relates.
Under the approved deed of company arrangement, Equestrian
Australia must call a special meeting of its six state
representatives to consider the constitutional amendment to give
its 20,000 members equal rights to the states, according to SMH.
If that resolution is passed, KordaMentha, will establish a
nominations committee to form a skills-based interim board within
45 days. No Equestrian Australia board member who has served in
the past three years will be appointed.
According to SMH, administrator Craig Shepard told the creditors'
meeting the plan was formulated after extensive consultation with
members and other stakeholders.
Equestrian Australia went into administration last month when Sport
Australia withdrew funding because of what it perceived to be poor
governance and bickering between Equestrian Australia and its state
branches.
Last week, five state branches (NSW, Victoria, Tasmania, South
Australia and Western Australia) threatened to block the proposed
reforms at the special meeting, SMH recalls. The veto risked a
liquidation of Equestrian Australia, a liability for bigger debts
and an unacceptable outcome for Australia's two peak sporting
bodies, Sport Australia and the Australian Olympic Committee.
SMH relates that an alternative plan proposed by the state
presidents was voted down at the meeting, despite the branches
having the advantage of direct contact with members. The states'
plan included no constitutional reform on member rights.
In June, Sport Australia forced Equestrian Australia into voluntary
administration, deeming its governance perennially unacceptable
after the resignation of eight directors and three chairs in just
over 16 months, the report recalls.
In the 35 years of Sport Australia, formerly the Australian Sports
Commission, it had never taken action which would lead a sport into
voluntary administration, adds SMH.
Catherine Margaret Conneely and Craig Peter Shepard of KordaMentha
were appointed as administrators of Equestrian Australia on June 9,
2020.
FIRSTMAC MORTGAGE 2-2020: S&P Assigns BB Rating on Cl. E Notes
--------------------------------------------------------------
S&P Global Ratings assigned ratings to eight of the nine classes of
prime residential mortgage-backed securities (RMBS) issued by
Firstmac Fiduciary Services Pty Ltd. as trustee for Firstmac
Mortgage Funding Trust No.4 Series 2-2020.
The ratings reflect:
-- S&P's view of the credit risk of the underlying collateral
portfolio, including the fact that this is a closed portfolio,
which means no further loans will be assigned to the trust after
the closing date.
-- S&P's view of the credit support, which is sufficient to
withstand the stresses we apply. Credit support for the rated notes
comprises note subordination, excess spread, and lenders' mortgage
insurance on 12.9% of the portfolio.
-- S&P's expectation that the various mechanisms to support
liquidity within the transaction, including a liquidity reserve
equal to 1.2% of the outstanding note balance, subject to a floor
of A$1,560,000, and the principal draw function are sufficient to
ensure timely payment of interest.
-- The extraordinary expense reserve of A$150,000, funded from day
one by Firstmac Ltd., available to meet extraordinary expenses. The
reserve will be topped up via excess spread if drawn.
-- The fixed- to floating-rate interest-rate swap provided by
National Australia Bank Ltd. to hedge the mismatch between receipts
from fixed-rate mortgage loans and the variable-rate RMBS.
-- Loss of income for borrowers in the coming months due to the
effects of COVID-19 might put upward pressure on mortgage arrears
over the longer term. S&P said, "We recently updated our outlook
assumptions for Australian RMBS in response to changing
macroeconomic conditions as a result of the COVID-19 outbreak. The
collateral pool at close for this transaction will not include any
loans where the borrower has applied for a COVID-19 hardship
payment arrangement. Nevertheless, we undertook additional
cash-flow sensitivity analysis to assess the rated notes'
sensitivity to delays in borrower payments should some loans enter
hardship arrangements following the closing date."
S&P Global Ratings acknowledges a high degree of uncertainty about
the evolution of the coronavirus pandemic. The consensus among
health experts is that the pandemic may now be at, or near, its
peak in some regions but will remain a threat until a vaccine or
effective treatment is widely available, which may not occur until
the second half of 2021. S&P said, "We are using this assumption in
assessing the economic and credit implications associated with the
pandemic. As the situation evolves, we will update our assumptions
and estimates accordingly."
RATINGS ASSIGNED
Firstmac Mortgage Funding Trust No.4 Series 2-2020
Class Rating Amount (mil. A$)
A-1a AAA (sf) 624.00
A-1b AAA (sf) 481.00
A-2 AAA (sf) 91.00
A-3 AAA (sf) 39.00
B AA (sf) 31.20
C A (sf) 14.30
D BBB (sf) 7.80
E BB (sf) 5.20
F NR 6.50
NR--Not rated.
The issuer will not be publicly disclosing all relevant information
about the structured finance instruments that are subject to this
rating report or whether relevant information remains nonpublic.
GOLDEN CARLINGFORD: First Creditors' Meeting Set for July 23
------------------------------------------------------------
A first meeting of the creditors in the proceedings of:
- Golden Carlingford Pty Ltd
- Pennant Hills Estates 88 Pty Ltd
- Rainbowforce Pty Ltd
- Stamford House 88 Pty Ltd
will be held on July 23, 2020, at 11:00 a.m. at the offices of HLB
Mann Judd (NSW) Pty Ltd, Level 19, 207 Kent Street, in Sydney,
NSW.
Barry Anthony Taylor and Todd Andrew Gammel of HLB Mann Judd were
appointed as administrators of Golden Carlingford et al. on July
13, 2020.
HOUSE SPAGHETTI: First Creditors' Meeting Set for July 27
---------------------------------------------------------
A first meeting of the creditors in the proceedings of House
Spaghetti Pty Ltd, trading as "Spaghettihouse", "The
Spaghettihouse", and "The Spaghetti House Trattoria", will be held
on July 27, 2020, at 11:00 a.m. at Level 54, 111 Eagle Street, in
Brisbane, Queensland.
Stephen Robert Dixon of Hamilton Murphy Advisory was appointed as
administrator of House Spaghetti on July 15, 2020.
MCWILLIAM'S WINES: Creditors to Vote on Private Equity Deal
-----------------------------------------------------------
Darren Gray at The Sydney Morning Herald reports that private
equity firm Prcstnt Asset Management is in the box seat to pick up
one of Australia's oldest family-owned wine companies, McWilliam's
Wines Group, with creditors to vote on a $50 million deal next
week.
McWilliam's, which has been operating for nearly 150 years and been
led by six generations of the McWilliam family, appointed voluntary
administrators from KPMG in January after battling inadequate cash
flows and a long history of trading losses, the report notes.
According to SMH, KPMG's Gayle Dickerson, Tim Mableson and Ryan
Eagle have recommended that creditors support the recapitalisation
proposal from Prcstnt Asset Management. McWilliam's, which has
about 150 employees, owed close to $40 million to about 300
creditors when it went into voluntary administration.
SMH says the McWilliam's/Prcstnt Asset Management deal comes after
a number of parties expressed interest in the winemaker. In a
257-page report, the administrators said the return to unsecured
creditors under the deed of company arrangement proposed was
estimated at 94 cents to 100 cents in the dollar, SMH discloses.
According to SMH, McWilliam's was ranked Australia's seventh
biggest wine company by revenue in a recent report by The
Australian & New Zealand Grapegrower & Winemaker magazine. It is an
unlisted publicly owned company with 80 shareholders, many of whom
are from the McWilliam family. It recorded gross sales of $97
million in 2018-19.
By way of comparison, Australia's biggest wine company, the
ASX-listed Treasury Wine Estates, recorded net sales revenue of
$2.83 billion in 2018-2019, SMH discloses.
It has a heritage stretching back nearly 150 years to when Samuel
McWilliam planted the family's first vines in 1877 at Corowa, NSW.
The company has significant operations in the NSW Riverina and the
Hunter Valley and owns the Hanwood winery, one of the country's
biggest wineries, and Mount Pleasant. Its ranges include
McWilliam's, Mount Pleasant and McW.
"Our potential investment in McWilliam's Wines Group is a great
opportunity to make a cornerstone investment in the viticulture
sector in Australia," SMH quotes Charles Hunting, the
Australian-based executive chairman of Prcstnt (pronounced
"persistent") Asset Management, as saying.
"Whilst it is critical that McWilliam's is moved out of
Administration and returned to profitability in the immediate term,
over the medium to longer term we will look to inject further
capital to scale the business in both domestic and international
markets, while driving environmental outcomes in line with our
philosophy," he said.
SMH relates that Ms. Dickerson said a significant milestone in the
administration process for McWilliam's had been reached.
"The proposal received from Prcstnt Asset Management provides a
platform for growth and a confident step forward for the company,
employees and stakeholders," the report quotes Ms. Dickerson as
saying.
The KPMG report outlined a range of reasons the administrators
believed were behind the wine group's failure, including a history
of significant trading losses, a failure to secure adequate debt
and equity funding, pressure on margins and declining sales, SMH
notes.
SWEENEY (YARRAVILLE): First Creditors' Meeting Set for July 27
--------------------------------------------------------------
A first meeting of the creditors in the proceedings of Sweeney
(Yarraville) Pty Ltd will be held on July 27, 2020, at 2:30 p.m.
via teleconference.
Con Kokkinos of Worrells Solvency & Forensic Accountants was
appointed as administrator of Sweeney (Yarraville) on July 16,
2020.
TELEGRAPH POINT: Second Creditors' Meeting Set for July 23
----------------------------------------------------------
A second meeting of creditors in the proceedings of Telegraph Point
Sports & Recreation Club Limited has been set for July 23, 2020, at
9:00 a.m. at Telegraph Sports & Recreation Club, 182 Mooney Street,
in Telegraph Point, NSW.
The purpose of the meeting is (1) to receive the report by the
Administrator about the business, property, affairs and financial
circumstances of the Company; and (2) for the creditors of the
Company to resolve whether the Company will execute a deed of
company arrangement, the administration should end, or the Company
be wound up.
Creditors wishing to attend are advised proofs and proxies should
be submitted to the Administrator by July 22, 2020, at 5:00 p.m.
Gregory J Parker and Christopher J MacDonnell of Restructuring
Solutions were appointed as administrators of Telegraph Point on
June 18, 2020.
TM LEWIN: Australian Business Owes AUD10MM, Administrators Say
--------------------------------------------------------------
Heather McIlvaine at Inside Retail reports that TM Lewin's
Australian business owes approximately AUD10 million to around 70
creditors, according to administrators from EY, who held the first
meeting of creditors on July 13.
Most of that debt, approximately AUD8.6 million, is owed to TM
Lewin-related entities in the UK, where the British suitmaker's
owner, Torque Brands, is based, Inside Retail discloses.
Torque Brands purchased TM Lewin from Bain Capital in May and
announced the closure of all 66 TM Lewin stores in the UK just a
few weeks later on July 1.
"The Torque team has worked to assess all available avenues for the
business model going forwards, but having done so, has formed the
view that TM Lewin is no longer a viable going concern in its
current format," the company said, according to the BBC, relays
Inside Retail.
According to Inside Retail, EY partner Stewart McCallum said the
appointment of administrators in Australia earlier this month was
due to the brand's collapse in the UK and the impact of Covid-19 on
foot traffic in Sydney, Melbourne and Brisbane CBDs, where stores
are located.
"Different parts of the retail sector are performing differently
during Covid, and have been impacted differently by Covid," the
report quotes Mr. McCallum as saying. "In TM Lewin Australia's
case, the reduction in foot traffic in the CBD - as a result of
significantly increased working from home - had a material negative
impact on the business."
All five TM Lewin stores in Australia remain closed, though
McCallum said the administrators are considering reopening stores
in Brisbane and Sydney, with the idea that stores in Melbourne
would reopen after stage 3 restrictions lift, the report notes.
Mr. McCallum said the administrators have yet to commence a formal
sale process for the business, but have already received multiple
unsolicited approaches, according to the report.
A second creditors meeting is scheduled for late October, Inside
Retail adds.
Stewart McCallum, Adam Nikitins and Colby O'Brien of Ernst & Young
were appointed as administrators of T.M. Lewin Australia Pty Ltd on
July 1, 2020.
TOMI-SASHA HOLDINGS: First Creditors' Meeting Set for July 24
-------------------------------------------------------------
A first meeting of the creditors in the proceedings of Tomi-Sasha
Holdings Pty Ltd will be held on July 24, 2020, at 3:00 p.m. at the
offices of Vince & Associates, 51 Robinson Street, in Dandenong,
Victoria.
Paul William Langdon and Ian Graham Grant of Vince & Associates
were appointed as administrators of Tomi-Sasha Holdings on July 14,
2020.
TORO GROUP: Second Creditors' Meeting Set for July 23
-----------------------------------------------------
A second meeting of creditors in the proceedings of Toro Group Pty
Ltd has been set for July 23, 2020, at 11:30 a.m. at the offices of
Worrells Solvency & Forensic Accountants, Suite 1, 151 Tongarra
Road, in Albion Park, NSW.
The purpose of the meeting is (1) to receive the report by the
Administrator about the business, property, affairs and financial
circumstances of the Company; and (2) for the creditors of the
Company to resolve whether the Company will execute a deed of
company arrangement, the administration should end, or the Company
be wound up.
Creditors wishing to attend are advised proofs and proxies should
be submitted to the Administrator by July 23, 2020, at 11:30 a.m.
Stephen John Hundy and Daniel Ivan Cvitanovic of Worrells Solvency
& Forensic Accountants were appointed as administrators of Toro
Group on June 24, 2020.
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C H I N A
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GREENLAND GLOBAL: Moody's Rates New Senior Unsec. USD Notes 'Ba2'
-----------------------------------------------------------------
Moody's Investors Service has assigned a Ba2 rating to the proposed
senior unsecured USD notes to be issued by Greenland Global
Investment Limited.
The notes will be issued under Greenland Global's medium-term note
program ((P)Ba2), which is unconditionally and irrevocably
guaranteed by Greenland Holding Group Company Limited (Ba1
stable).
The outlook on the rating is stable.
Greenland Holding will primarily use the proceeds from the issuance
to refinance its existing debt.
RATINGS RATIONALE
"The proposed notes will lengthen Greenland Holding's debt maturity
profile without materially impacting its credit metrics, because
the proceeds will mainly be used to refinance its existing debt,"
says Danny Chan, a Moody's Assistant Vice President and Analyst,
who is also the Lead Analyst for Greenland Holding.
Moody's expects Greenland Holding's revenue/adjusted debt will
weaken to around 131% in 2020 from 137% in 2019, as construction
suspensions and delays caused by the coronavirus outbreak adversely
affect the revenue growth of its property development and
construction businesses. Its revenue/debt will likely recover to
143% in 2021, supported by an expected rebound in revenue from
these businesses and slowing debt growth.
At the same time, Moody's expects Greenland Holding's EBIT/interest
coverage will decline to 2.7x-2.8x over the next 12-18 months from
3.3x in 2019, mainly because of higher interest expenses as well as
weakening profit margins due to increasing revenue contribution
from its low-margin construction business.
The company's contracted sales fell 27% to RMB50.5 billion in the
first quarter of 2020 compared with the same period last year, as
disruptions caused by the coronavirus outbreak weakened sales.
Moody's expects contracted sales to remain stable at RMB380
billion-RMB400 billion over the next 12-18 months compared with
RMB388 billion in 2019, supported by Greenland Holding's sizable
land bank and strong sales execution.
Greenland Holding's Ba1 corporate family rating reflects its: (1)
large-scale and nationwide coverage, as well as wide range of
products in the property business across different tier cities in
China (A1 stable); (2) fast-growing construction business driven by
acquisitions and organic growth; and (3) access to funding because
of its local state-owned enterprise background.
On the other hand, Greenland Holding's rating is constrained by its
weak interest coverage and the execution risks associated with its
fast-growing construction business.
The company's liquidity is adequate, despite its cash holdings
covering only 72% of its short-term debt as of March 2020. Moody's
expects the company's cash holdings, together with cash flow
generated from operating activities, will be sufficient to cover
its maturing debt (including onshore puttable bonds) and committed
land payments over the next 12-18 months.
The company has a good history of accessing different funding
channels to support its debt refinancing and high funding needs
because of its ownership by the Shanghai municipal government.
Moreover, the proposed notes, together with the USD500 million
notes issued in June 2020, will help improve its liquidity.
The Ba2 rating on the proposed notes reflects the risk of
structural subordination, given that the majority of claims are at
the operating subsidiaries and will be prioritized over claims at
the holding company in the event of a bankruptcy. In addition,
there are few mitigating factors for structural subordination at
the holding company, reducing the likely recovery rate for claims
at the holding company level.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
The stable outlook reflects Moody's expectation that the company
will continue to control its debt growth and pace of land
acquisitions while growing its scale over the next 12-18 months.
Moody's could upgrade the rating if the company (1) sustains its
leading position in China's residential market; (2) maintains
prudent practices in its land acquisition and financial management;
and (3) improves its credit metrics, such that its revenue/debt
remains above 140% and EBIT/interest remains above 3.5x on a
sustained basis.
On the other hand, Moody's could downgrade the rating if the
company experiences (1) weak sales performance or weak collections
on its sales proceeds; (2) a decline in its profit margin; (3) a
sizable increase in debt, arising from aggressive expansion or land
acquisitions; or (4) an increase in the risk profile of its
non-property businesses.
Moody's would also consider downgrading the rating if the company's
credit metrics weaken, such that its revenue/adjusted debt falls
below 100% and adjusted EBIT/interest declines to 2.0x-2.5x on a
sustained basis.
A significant reduction in the Shanghai government's ownership of
Greenland Holding, which would hurt the company's access to
funding, could also bring about a downgrade.
The principal methodology used in these ratings was Homebuilding
and Property Development Industry published in January 2018.
Headquartered in Shanghai, Greenland Holding Group Company Limited
is a state-controlled enterprise that primarily focuses on the real
estate sector, with dealings in construction, finance and auto
dealerships as well. The Shanghai State-owned Assets Supervision
and Administration Commission is effectively the largest
shareholder of Greenland Holding.
TAHOE GROUP: Warns Creditors It Will Default Again
--------------------------------------------------
Qu Hui and Timmy Shen of Caixin Global report that debt-laden
luxury villa developer Tahoe Group Co. Ltd. recently estimated that
it had booked a loss in the first half of the year, and warned
creditors it expects to default on more debts.
The Fujian province-based developer said that it expects a net loss
of CNY1.46 billion (US$209 million) to CNY1.86 billion for the
first half of this year, down from a net profit of CNY1.56 billion
over the same period last year, Caixin discloses citing to a
statement on July 15.
The company is facing mounting losses amid declining sales and
rising interest payments, Caixin notes. Its 2019 annual report
showed the company was struggling even before the coronavirus
outbreak, losing some CNY1.9 billion - excluding extraordinary
profit and loss - in the fourth quarter of last year, down
significantly from a net profit of CNY627 million over the same
period in 2018.
The property developer said that whether it can meet upcoming
payments on its existing debt obligations will be based on an
assessment of its overall financial condition, and that "lenders
and noteholders should not expect payments of principal and
interest according to existing terms" in a statement published July
14 on the Singapore Stock Exchange's website, Caixin relays.
Just last week, the company failed to repay a CNY1.5 billion bond,
taking its total overdue borrowings to CNY27.1 billion, Caixin
recalls. The default underscores the growing financial stress on
cash-strapped home-builders hit by the double whammy of a slowing
economy and the fallout from the coronavirus pandemic.
Caixin adds that the company also disclosed in a filing to the
Shenzhen Stock Exchange last week that it has a total of CNY55.5
billion of debt maturing this year, but had only repaid CNY4.8
billion by July 7 and managed to extend the repayment period for
another CNY6.2 billion of debt which was originally due in the
first half of the year.
According to Caixin, the growing risks attached to Tahoe's bonds
and its limited ability to refinance its debts prompted Fitch
Ratings Inc. to cut the company's long-term foreign currency issuer
rating last week to RD (restricted default) from CC, dropping
further into junk bond territory, "as the company has experienced
an uncured payment default on a material financial obligation but
has not yet entered into bankruptcy filings, administration,
receivership, liquidation, or other formal winding-up procedures,
and has not otherwise ceased operating." Fitch Ratings previously
cut the firm's rating twice in four days in May, first from B- to
CCC+ on May 11 and then to CC on May 14.
In order to stabilize itself, Tahoe has sought financial advisors
to provide strategic advice with respect to its capital structure,
it said in the Singapore bourse statement, Caixin relays. "Such
financial advisors will assist the company in reviewing and
assessing various options and in formulating a plan to implement an
appropriate restructuring of the group's onshore and offshore debt
obligations," Tahoe said.
About Tahoe Group
Tahoe Group Co., Ltd operates real estate development businesses.
The Company provides house loans, housing renovation, housing
loans, real estate brokerage, property management, and other
services. Tahoe Group also operates hotel management, investment
management, and other businesses.
As reported in the Troubled Company Reporter-Asia Pacific on July
14, 2020, Moody's Investors Service has downgraded the corporate
family rating of Tahoe Group Co., Ltd to Caa3 from Caa1. At the
same time, Moody's has downgraded to Ca from Caa2 the backed senior
unsecured rating on the notes issued by Tahoe Group Global (Co.)
Limited and unconditionally and irrevocably guaranteed by Tahoe.
The outlook on the ratings remains negative.
YANZHOU COAL: Fitch Puts 'BB-' LT IDR on Watch Positive
-------------------------------------------------------
Fitch Ratings has placed Yanzhou Coal Mining Company Limited's
Long-Term Issuer Default Rating and senior unsecured rating of
'BB-' on Rating Watch Positive. At the same time, Fitch has placed
the 'BB-' rating on Yanzhou Coal's USD550 million 5.73% senior
unsecured notes due 2022 on RWP. The notes are issued by Yancoal
International Resources Development Co., Limited, a wholly owned
subsidiary, and unconditionally and irrevocably guaranteed by
Yanzhou Coal.
The RWP reflects Fitch's expectation that when the merger of
Yankuang Group Co., Ltd., which owns 51.8% of Yanzhou Coal, and
Shandong Energy Group Co., Ltd is completed, the combined entity
will have a stronger likelihood of support from Shandong province
than Yankuang has currently due to the enhanced strategic role in
coal supply and leading position among state-owned-enterprises in
Shandong province. Fitch awaits further clarity on the deal,
including timeline for completion, potential asset restructuring
and integration, among others. Still, it is likely to assess the
credit profile of the combined entity under a top-down approach
from Fitch's internal assessment of the credit worthiness of the
Shandong province, based on Fitch's Government-Related Entities
Rating Criteria.
In addition, Fitch is likely to rate Yanzhou Coal based on a
top-down approach on completion of the merger, under its Parent
Subsidiary Rating Linkage criteria, as Fitch expects Yanzhou Coal's
linkage with the combined entity's to be strong. Fitch expects to
resolve the RWP on completion of the merger.
KEY RATING DRIVERS
Parent's Merger with Shandong Energy: Yanzhou Coal announced on
July 12 that its parent, Yankuang, plans to merge with Shandong
Energy, the other provincial coal mining SOE in Shandong province.
Multiple Chinese news media outlets reported that a government
meeting hosted by the head of the Shandong State-owned Asset
Supervision and Administration Commission was held on July 13 to
announce the merger. Yankuang's chairman will become the chairman
of the combined entity.
Fitch believes the merger is being driven by the Shandong SASAC's
SOE reform agenda, which aims to reduce the number of provincial
SOEs and increase their asset return.
Strengthened Likelihood of Support: The combined entity is likely
to receive stronger likelihood of support that warrants a top-down
approach in assessing its credit profile under Fitch's GRE
criteria. Yankuang and Shandong Energy combined account for most of
the coal production in Shandong and meet around 40% of the
province's coal consumption. Fitch regards partial self-sufficiency
of coal facilitated by Yankuang and Shandong Energy as important to
Shandong province due to the energy-intensive economy. In addition,
individually Yankuang and Shandong Energy are among the top five
largest provincial SOEs in Shandong in terms of assets. The
combined entity will rank the second in asset and equity size, next
to the combined entity of Shandong High-speed Group Co., Ltd. (SHS,
A/Stable) and Qilu Transportation Development Group Co., Ltd.
(A/Stable), and the first in the scale of revenue, profit and cash
flow.
Strong Linkage: Fitch expects to rate Yanzhou Coal based on a
top-down approach from its parent after the merger, as the linkage
between Yanzhou Coal and the combined entity is likely to remain
strong. Yanzhou Coal will remain the combined entity's only listed
subsidiary engaged in coal mining other than Yanzhou Coal's
subsidiary Yancoal Australia Ltd. Fitch estimates Yanzhou Coal
contributes around 45% of the combined entity's coal production and
a third of its EBITDA as of 2019 and holds most of the overseas
coal mines. In addition, Yankuang guarantees CNY12.8 billion of
Yanzhou's debt as of end-2019, which Fitch views as strong tangible
support.
Stronger Standalone Profile of Parent: Fitch expects the combined
entity to have a stronger Standalone Credit Profile than 'b-' due
to its significantly larger scale and a better free cash flow
profile compared with Yankuang. Yankuang and Shandong Energy
combined will be the second-largest coal mining company in China
after China Energy Investment Corporation Limited. The average mine
life and cost position of Shandong Energy's coal mines are
comparable with those of Yankuang. Fitch estimates 2019 fund from
operations net leverage of 5.7x for the combined group on a pro
forma basis, compared with Yankuang's 5.8x. The FCF of the combined
entity is likely to be better than that of Yankuang due to Shandong
Energy's stronger operating cash flow and more conservative capex.
DERIVATION SUMMARY
Yanzhou Coal's rating is based on the consolidated credit profile
of Yankuang, reflecting the moderate linkage between the two
entities under Fitch's Parent and Subsidiary Rating Linkage
criteria. Yankuang's consolidated credit profile incorporates an
uplift from its standalone profile based on its GRE criteria.
Yankuang's assessment of 'Strong' under the status, ownership and
control factor is lower than that of SHS due to exceptionally high
degree of government control over the latter's strategic and
investment decisions as a key provincial infrastructure investment
platform, while Yankuang's business is more commercially oriented.
Yankuang's 'Moderate' support record and 'Strong' financial
implications of a default are in line with the assessment for other
large provincial SOEs in the energy or commodity sectors, including
Gansu Province Electric Power Investment Group Co., Ltd.
(BBB-/Stable) and Jiuquan Iron and Steel (Group) Co., Ltd.
(BBB-/Stable). The 'Weak' assessment of the socio-political impact
of a default takes into account Yankuang's large asset exposure
outside Shandong province as well as the province's heavy reliance
on coal supply from other provinces.
Yankuang's SCP of 'b-' is comparable with that of HBIS Group Co.,
Ltd. (BBB+/Stable; SCP: b-). Both are big companies in their
respective sectors, coal mining and steel. Yankuang and HBIS have
similar operating scales and single-digit market shares in
industries with many smaller companies. The SCPs of both companies
are constrained by their weak financial profiles, which are
characterised by higher leverage and structurally negative FCF.
Yankuang's FFO net leverage averaged 8.5x in 2015-2018, a similar
level to HBIS's 9.1x.
KEY ASSUMPTIONS
Fitch's Key Assumptions Within Its Rating Case for the Issuer
- Average selling price of self-produced coal at CNY512/tonne in
2019, CNY477/tonne in 2020, CNY473/tonne in 2021 and CNY468/tonne
in 2022;
- Unit coal production cost to remain flat in the coming years;
- Coal production to rise at 2.2% CAGR in 2019-2022;
- Annual capex averaging CNY7.3 billion in 2019-2022 and on a
downward trend.
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
- Fitch may upgrade Yanzhou Coal's ratings by more than one notch
upon completion of the announced merger
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
- The RWP will be resolved and the rating will be affirmed at
'BB-' if the merger is not completed.
BEST/WORST CASE RATING SCENARIO
International scale credit ratings of Non-Financial Corporate
issuers have a best-case rating upgrade scenario (defined as the
99th percentile of rating transitions, measured in a positive
direction) of three notches over a three-year rating horizon; and a
worst-case rating downgrade scenario (defined as the 99th
percentile of rating transitions, measured in a negative direction)
of four notches over three years. The complete span of best- and
worst-case scenario credit ratings for all rating categories ranges
from 'AAA' to 'D'. Best- and worst-case scenario credit ratings are
based on historical performance.
LIQUIDITY AND DEBT STRUCTURE
Sufficient Liquidity: Yanzhou Coal had readily available cash of
CNY22.8 billion by end-2019 (end-2018: CNY27.4 billion), enough to
cover its debt maturing within one year of CNY16.2 billion
(end-2018: CNY20.1 billion). The company also had total undrawn
bank credit facilities of CNY62.3 billion as of end-2019. Fitch
expects the company to continue to benefit from strong access to
domestic funding sources due to its large SOE status.
REFERENCES FOR SUBSTANTIALLY MATERIAL SOURCE CITED AS KEY DRIVER OF
RATING
The principal sources of information used in the analysis are
described in the Applicable Criteria.
=========
I N D I A
=========
ASK HOME: CARE Keeps D Debt Ratings in Not Cooperating Category
---------------------------------------------------------------
CARE Ratings said the rating for the bank facilities of ASK Home
Furnishings Private Limited (ASK) continues to remain in the
'Issuer Not Cooperating' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term bank 17.53 CARE D Issuer not cooperating;
facilities Based on best available
information
Short Term Bank 1.00 CARE D; Issuer not cooperating;
Facilities Based on best available
Information
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated June 11, 2019 placed the
ratings of ASK under the 'issuer non-cooperating' category as ASK
Home Furnishing Private Limited had failed to provide information
for monitoring of the rating. ASK Home Furnishing Private Limited
continues to be non-cooperative despite repeated requests for
submission of information through e-mails, phone calls and a
letter/email dated June 23, 2020, June 25, 2020. 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.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above ratings.
Detailed description of the key rating drivers
At the time of last rating on June 11, 2019, the following were the
rating weakness:
The ratings take into account the ongoing delays in debt servicing
obligations due to stressed liquidity position.
Delhi based ASK Home Furnishings Private Limited (ASK) was
incorporated in February 2005, is promoted by Mr. Sandeep Singh
Kochar and his wife, Ms Amita Kochar. Earlier, the company was also
into the trading of bed sheet, and the same was discontinued from
FY11. Currently the company is engaged in manufacturing of mink
blankets and mink blankets fabric from its manufacturing facility
located at village Pathredi, Gurgaon in Haryana. ASK manufactures
wide range of blankets like double bed, single bed and baby
blankets. It sells its products all over India under the brand name
'Home Jewels'. The main raw materials used for manufacturing
blankets are yarn and fabric, which are procured domestically from
Silwasa near Mumbai.
AYKA MOULD: CARE Keeps D Debt Ratings in Not Cooperating Category
-----------------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Ayka Mould
Tech Industries Limited (AMTIL) continues to remain in the 'Issuer
Not Cooperating' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term bank 7.43 CARE D Issuer not cooperating;
facilities Based on best available
information
Short-term bank 0.50 CARE D Issuer not cooperating;
facilities Based on best available
Information
Detailed Rationale & Key Rating Drivers
CARE had, vide press release dated November 14, 2019, placed the
ratings of AMTIL under the 'Issuer Non-cooperating' category as
AMTIL had failed to provide information for monitoring of the
ratings. AMTIL continues to be non-cooperative despite requests for
submission of information through phone calls and e-mails dated
June 10, 2020, June 12, 2020 and June 15, 2020. 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.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating.
Detailed description of the key rating drivers
At the time of last rating on November 14, 2019, the following were
the rating weaknesses (updated based on best available
information):
Key Rating Weaknesses
* Ongoing delays in debt servicing: There are ongoing delays in
debt servicing in the bank facilities availed by AMTIL.
Daman-based Ayka Mould Tech Industries Limited (AMTIL) was
incorporated by Mr. Sahil Basir Shaikh, Mr. Asfaq Basir Shaikh, Ms.
Samimbanu Basirbhai Shaikh and Ms. Sahnaj Sahil Shaikh. The entity
is established to carry on the business of manufacturing plastic
crates, plastic chairs and other plastic products from its sole
manufacturing facility located in Daman, with an installed capacity
of 15 tons of plastic goods per day. AMTIL completed its project in
June, 2017, with a total cost of INR5.60 crore and a debt-equity
mix of 2.37 times, while it commenced its commercial production
from June, 2017 onwards. While, it imports Polypropylene (PP)/
High-density polyethylene (HDPE)/ Low-density polyethylene (LDPE)
granules from UAE as well as purchases domestically, it sells it
finished products to various traders in India.
BALWAN POULTRY: CARE Keeps D on INR6cr Debt in Not Cooperating
--------------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Balwan
Poultry and Breeding Farm (BPB) continues to remain in the 'Issuer
Not Cooperating' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term bank 6.00 CARE D Issuer not cooperating;
facilities Based on best available
information
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated June 6, 2019 placed the
ratings of BPB under the 'issuer non-cooperating' category as
Balwan Poultry & Breeding Farm had failed to provide information
for monitoring of the rating. Balwan Poultry & Breeding Farm
continues to be non-cooperative despite repeated requests for
submission of information through e-mails, phone calls and a
letter/email dated June 23, 2020, June 25, 2020. 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.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above ratings.
Detailed description of the key rating drivers
At the time of last rating on June 6, 2019, the following were the
rating weakness:
The ratings take into account the ongoing delays in debt servicing
obligations due to stressed liquidity position.
Balwan Poultry and Breeding Farm (BPB) was established in 2000 as a
proprietorship firm. The operations of the firm are currently being
managed by Mr. Balwan Singh. BPB is engaged in poultry farming
business which involves growing of 1 day chick into egg laying
birds. Subsequently, the eggs laid by them are artificially
incubated into chicks (incubation time is 21 days). The processing
facility of the firm is located at Karnal, Haryana. BPB sells the
day-old chick mainly through the commission agents located in
Haryana and Punjab. The firm procures day-old chicks from
Venkateshwara Hatcheries and feeding materials for the chicken viz.
maize, soyabean and defatted rice bran from traders located in
Haryana and near regions.
BHORUKA POWER: CARE Keeps D Debt Ratings in Not Cooperating
-----------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Bhoruka
Power Corporation Ltd. (BPCL) continues to remain in the 'Issuer
Not Cooperating' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long term Bank 522.67 CARE D; Issuer not cooperating;
Facilities– Based on best available
Term Loan Information
Long term Bank 8.00 CARE C; Issuer not cooperating;
Facilities– Based on best available
Cash Credit Information
Medium Term 10.00 CARE C(FD); Issuer not
Instruments– cooperating; Based on best
Fixed Deposit available information
Short term 40.00 CARE A4; Issuer not
Bank Facilities cooperating; Based on best
available information
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated April 4, 2019, placed the
rating(s) of BPCL under the 'Issuer non-cooperating' category as
Bhoruka Power Corporation Ltd had failed to provide information for
monitoring of the rating as agreed to in its Rating Agreement. BPCL
continues to be non-cooperative despite repeated requests for
submission of information through e-mails, phone calls and a
letter/email dated June 11, 2020. 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.
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 of the company continues to factor in delays in debt
servicing by the company as confirmed with lenders. However, CARE
is unable to ascertain on timely repayment of interest/principal
amount on FD.
Detailed description of the key rating drivers
At the time of last rating on April 4, 2019 the following were the
rating strengths and weaknesses:
Key Rating Weaknesses
* Delays in debt servicing: There have been ongoing delays in term
debt servicing by the company due to tight liquidity position.
* Lower than expected generate on resulting in tight liquidity
position: During FY18 and 9MFY19, the generation was lower than
anticipated. Resultantly, the company's cash flow has been under
pressure and the company had relied on refinancing part of debt and
availing additional debt during the year to manage the tight
liquidity position. Additionally, delayed realization of
receivables from its major counter party, HESCOM continues to keep
its liquidity position tight.
Key Rating Strengths
* Established track record of the company in commissioning and
operating hydro and wind power plants: With more than three decades
of operations, BPCL has a well-established track record in
developing &operating hydel& wind power plants. As on March 31,
2019, BPCL has 13 hydro power plants, 8 wind power plants and two
solar power plants with an installed capacity of 96.9 MW, 181.3 MW
and 30 MW respectively. Group runs a hydro project also under its
subsidiary with installed capacity of 13 MW.
Analytical approach: Consolidated. For Analytical purposes, the
credit profile of Bhoruka Power Corporation Limited (BPCL) along
with its wholly owned subsidiary Sagar Power (Dandela) Limited
(Hydro unit with a capacity of 13 MW) is considered as both the
entities are engaged in generation of renewable energy and operate
under the same management.
Incorporated in 1986, Bhoruka Power Corporation Ltd (BPCL) is
engaged in the generation of renewable energy. BPCL is a part of
Bhoruka group promoted by Mr. S. N. Agarwal, engaged in various
businesses such as industrial gases, refractory items, power, real
estate etc. The company has 13 hydro power plants (96.90 MW), 8
wind power plants (181.3 MW) and 2 solar power plants (30 MW), all
of which are operational.
DEWAN HOUSING: ED Files Supplementary Charge Sheet vs. Promoters
----------------------------------------------------------------
ETRealty.com reports that five days after it attached properties
worth INR2,203 crore in the Yes Bank fraud case, the Enforcement
Directorate filed a supplementary charge sheet before a special
court in Mumbai, naming 11 other accused in the matter, official
sources said on July 13.
According to ETRealty.com, the over 100-page charge sheet has been
filed against 19 persons or entities, including 8 named in the
previous charge sheet, filed before the Special Court under the
Prevention of Money Laundering Act.
Among the accused are: Kapil Wadhawan, Promoter of Diwan Housing
Finance Ltd, Dhiraj Wadhawan, DHFL's non-executive director, Yes
Bank's former MD & CEO Rana Kapoor, his wife Bindu, their daughters
Radha, Rekha and Roshni, and chartered accountant Dhulresh Jain.
Besides, the entities named are the Kapoors' family concern, DHFL,
Yes Capital Pvt Ltd, DoIt Urban Ventures Pvt Ltd, Rab Ventures,
Kyta Advisors Ltd, RKW Developers, Morgan Credit Pvt Ltd, Belief
Realty, Golden Western Ltd, Samapti Trading Pv Ltd. and Valencia
Developers, ETRealty.com discloses.
ETRealty.com relates that the development came barely 5 days after
the ED attached all the assets, around 344 bank accounts,
investments and high-end vehicles in India, New York and Australia
belonging to the Kapoors and Wadhawans, collectively worth INR2,203
crore.
Contending that the proceeds of crime amount to around
INR5,000-plus crore besides the value of the attachments last week,
the ED has said that an amount of INR600 crore was allegedly given
as a kickback to companies owned by Kapoor's daughters in return
for loans sanctioned by Yes Bank to some companies, ETRealty.com
relays.
ETRealty.com says the Wadhawan brothers were arrested by the CBI -
which is also probing the case - from Mahabaleshwar hill station in
Maharashtra on April 26 and later the ED also nabbed them in May.
About DHFL
Dewan Housing Finance Corporation Limited (DHFL) operates as a
housing finance company in India. The company's deposit products
include fixed deposit products for individuals, and trusts and
institutions; and corporate, recurring, and Wealth2Health deposits
products. It also offers home loans, which include home improvement
loans, home construction loans, home extension loans, plot
loans/land loans, plot and construction loans, and balance transfer
of home loans, as well as home loans for the self-employed; small
and medium enterprise loans, including property term, plant and
machinery, medical equipment, and business loans; mortgage loans,
such as loans against property, loan for purchase of commercial
premises, and loan through lease rental discounting; and NRI home
loans.
As reported in the Troubled Company Reporter-Asia Pacific, Deccan
Herald said the Mumbai bench of the National Company Law Tribunal
(NCLT) on Dec. 2, 2019, admitted a petition by the Reserve Bank of
India (RBI) seeking bankruptcy proceedings to resolve DHFL. The
move came in after the Reserve Bank on Nov. 29, 2019, made an
application for bankruptcy proceedings to resolve the credit and
liquidity crisis at the company, which became the first financial
sector player being sent for bankruptcy. RBI appointed R
Subramaniah Kumar as the company's administrator. Financial
creditors to DHFL have submitted claims worth INR86,892 crore
against the mortgage lender, BloombergQuint disclosed.
ESKAY SILK: CARE Keeps D Debt Ratings in Not Cooperating
--------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Eskay Silk
Industries Private Limited (ESIPL) continues to remain in the
'Issuer Not Cooperating' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term bank 16.19 CARE D Issuer not cooperating;
facilities Based on best available
information
Short-term bank 2.50 CARE D Issuer not cooperating;
facilities Based on best available
Information
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated June 19, 2019, placed the
rating(s) of ESIPL under the 'issuer non-cooperating' category as
ESIPL had failed to provide information for monitoring of the
rating and had not paid the surveillance fees for the rating
exercise as agreed to in its Rating Agreement. ESIPL continues to
be non-cooperative despite repeated requests for submission of
information through e-mails, phone calls and a letter/email dated
May 28, 2020. 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.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating.
The rating takes into account the delays in debt servicing.
Detailed description of the key rating drivers
At the time of last rating on June 19, 2019, the following were the
rating strengths and weaknesses (updated for the information
available from Registrar of Companies):
Key Rating Weaknesses
* Delays in debt servicing: Earlier, the account was classified as
NPA. Further, current status of the debt servicing is not
available.
Eskay Silk Industries Private Limited (ESIPL) was promoted by Shri
Motilal Jain and Shri Suresh Kumar Jain in 1984 and later taken
over by Agarwal family in 1991. ESIPL was earlier primarily engaged
in trading of high quality textile fabrics has now ventured into
fabric manufacturing from FY12. The capacity of ESIPL stood at
36.72 lakh pieces per annum as on March 31, 2015.
GHANSHYAM DAS: CARE Keeps D on INR11.85cr Debt in Not Cooperating
-----------------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Ghanshyam
Das Rungta Foundation (GDRF) continues to remain in the 'Issuer Not
Cooperating' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term bank 11.85 CARE D Issuer not cooperating;
facilities Based on best available
information
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated March 15, 2019, placed the
ratings of GDRF under the 'issuer non-cooperating' category as GDRF
had failed to provide information for monitoring of the rating and
had not paid the surveillance fees for the rating exercise as
agreed to in its Rating Agreement. GDRF continues to be
noncooperative despite request for submission of information
through a letter and email dated June 19, 2020. 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.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating.
Detailed description of the key rating drivers
At the time of last rating on March 15, 2019, the following was the
rating weakness:
Key Rating Weaknesses
* Ongoing delay in debt servicing: There are ongoing delays in the
servicing of GDRF's debt obligations.
Ghanshyam Das Rungta Foundation (GDRF), registered under Societies
Registration Act 1961, was established in November 27, 2008 by Mr.
Santosh Rungta for developing and running educational institutes in
and around Chhattisgarh. The society commenced operation in April,
2009 with two engineering institutes (named Rungta College of
Engineering & Technology and RSR Rungta College of Engineering &
Technology) and one general college (i.e. KD Rungta College of
Science & Technology). Subsequently in April 2012, the society
commenced a school named Rungta International School. The society
offers diverse programmes across various streams like engineering,
computer application, commerce, science, business administration
and Arts. The campus of the institutes is located at Bhilai and
Raipur in Chhattisgarh. The campuses of all the institutes are
spread over an aggregate area of 37 acres. The engineering colleges
are approved by AICTE (Ministry of HRD, Govt. of India) and
affiliated to Chhattisgarh Swami Vivekanand Technical University,
while general courses are affiliated to Pt. Ravishankar Shukla
University.
GUPTA EXIM: CARE Keeps D Debt Ratings in Not Cooperating
--------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Gupta Exim
India Private Limited (GEIPL) continues to remain in the 'Issuer
Not Cooperating' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term bank 457.92 CARE D Issuer not cooperating;
facilities Based on best available
information
Short-term bank 0.50 CARE D Issuer not cooperating;
facilities Based on best available
Information
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated April 3, 2019, placed the
ratings of GEIPL under the 'issuer non-cooperating' category as
GEIPL had failed to provide information for monitoring of the
rating. GEIPL continues to be non-cooperative despite repeated
requests for submission of information through e-mails, phone calls
and a letter dated June 12, 2020. 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.
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 assigned to the bank facilities of Gupta Exim India
Private Limited (GEIPL) continue to take into account the ongoing
delays in the servicing of debt obligations by the company.
Detailed description of the key rating drivers
At the time of last rating on April 3, 2019 the following were the
rating strengths and weaknesses (updated for the information
available from Ministry of Corporate Affairs):
Key Rating Weaknesses
* Ongoing delays in debt servicing: There are ongoing delays in the
servicing of debt obligations by the company. The company's debt
was restructured during FY14 (refers to the period April 1 to March
31) with cut-off date as July 1, 2013. Oriental Bank of Commerce
classified the loans as Non- Performing Assets on June 30, 2016.
The bank has filed petition to National Company Law tribunal under
section 7 of the Insolvency & Bankruptcy Code,2016 on September
02,2019. The Small Industries Development Bank of India had
classified the Company as NPA on April 10, 2016 and has filed a
Recovery Suit at DRT Chandigarh on September 10, 2018. The company
has reported losses at net level which has impacted its liquidity
position and the ability to timely service the debt.
* Loss at net level: The company reported net losses of INR26.05
crore during FY19 (PY: loss of Rs 53.74 crore). The PBILDT
deteriorated to loss of Rs 11.48 crore during FY19 (PY: INR17.92
crore).
* Volatility in the raw material prices: The primary raw material
used for the manufacturing of the garments is cotton yarn and the
domestic cotton prices continue to be governed by various external
factors including the international prices, the government
regulations in the domestic market etc. Hence, the margins of the
company are susceptible to the volatility in the cotton yarn
prices.
* Foreign Exchange Risk: In FY18, GEIPL exported around 70% of its
net sales. With most of the initial cash outlay for procurement in
domestic currency and major portion of sales realization in foreign
currency, the company is exposed to the fluctuation in exchange
rates. Moreover, the company has no defined policy of hedging and
is vulnerable to foreign exchange rates fluctuations
GEIPL, a Govt. of India recognized Export House, was established in
1990 and started commercial operations in 1992. The company is
engaged in knitting, dyeing, printing and processing of knitted
fabrics and manufacturing of garments like cotton T-Shirts and
Sweaters. GEIPL was promoted by Mr. Sandeep Gupta and his family
members in 1990, which have an experience of more than two decades
in manufacturing and export of garments. The company has six
integrated production units spread over 660,000 sq ft area in
Faridabad and Prithla, Haryana. GEIPL has an installed capacity of
8,000 tonnes p.a. for fabric processing (dyeing and manufacturing
of fabric) and has installed capacity of 10.8 million pieces p.a.
for garment manufacturing as on March 31, 2018.
J P AND COMPANY: CARE Lowers Rating on INR12cr LT Loan to C
-----------------------------------------------------------
CARE Ratings revised the ratings on certain bank facilities of J P
and Company (JPC), as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank 12.00 CARE C; ISSUER NOT COOPERATING;
Facilities Revised from CARE B-; Stable;
ISSUER NOT COOPERATING; on the
basis of best available
information
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated May 27, 2019, placed the
rating of JPC under the 'Issuer noncooperating' category as JPC had
failed to provide information for monitoring of the ratings as
agreed to in its rating agreement. JPC continues to be
non-cooperative despite repeated requests for submission of
information through e-mails, phone calls and a letter dated June 8,
2020, June 11, 2020 and June 18, 2020. 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.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating.
The rating assigned to the bank facilities of JPC have been revised
on account of non-availability of requisite information for
monitoring the rating.
Detail description of the key rating drivers
At the time of last rating on May 27, 2019, the following were the
rating strengths and weaknesses.
Key rating weaknesses
* Project implementation risk: JPC had envisaged total project cost
of INR31.20 crore towards the project to be funded through term
loan of INR12 crore, partner's capital of INR14.19 crore and
remaining through unsecured loans from promoters and related
parties. As on March 22, 2017, JPC had incurred total cost of
INR21.50 crore towards the project funded through term loan of
INR9.50 crore, share capital of INR11.50 crore and remaining
through unsecured loans. The company was expected to commence its
operations from May, 2017.
* Cyclical and Competitive nature of the industry with dependence
on tourist arrivals: Indian hotel industry is highly fragmented in
nature with presence of large number of organized and unorganized
players spread across all regions. The hospitality industry is
highly cyclical in nature and sensitive to any untoward events such
as slowdown in the economy. Further, Due to COVID-19 pandemic,
various countries had inhibited cross-border travelling and imposed
lockdown to contain the spreading of coronavirus, resulting in
suspension of all flights, trains and even prohibiting interstate
travel in India. Hospitality industry has faced mass scale
cancellations for travel bookings and hotel
accommodations and is highly unlikely to see any revival before
October, 2020.
Key rating strengths
* Experienced and qualified promoters in the industry with strong
group support: Mr Shahil Wadhwani and Mr Vansh Wadhwani are key
partners of the firm and MBA by qualification. They will look after
overall management, strategy and policy making functions of JPC and
will be supported from others partners. Wadhwani Family have been
engaged in the hotel industry since, 2012 through its group
concern, M/s V.S. Entertainment (VSE). VSE is running "Hotel
Winway" in Indore.
Location advantage Indore is the financial hub of Madhya Pradesh
(MP) and it is an industrial town having industries in all
directions of the city. The hotel is located near to proposed
super corridor by the government of MP for Information Technology,
Medical and Education industry.
Indore-based JPC was originally formed in 2013 as a partnership
concern by Maltani Family. However, in December, 2015, the firm was
taken over by Wadhwani Family. JPC was established with an
objective to set up a hotel in Indore (Madhya Pradesh). The hotel
will have facility of total 121 rooms includes; 89 Typical Rooms,
30 Jr. Suite rooms, 2 Suite rooms along with separate Vegetarian
and Non-Vegetarian restaurant, Gym, Swimming Pool, 3 banquet hall
and bar. JPC has envisaged that project will be completed in the
month of May, 2017 and is expected to commence its operations from
May, 2017.
JHARKHAND ROAD: CARE Hikes Rating on INR1,573.13cr Debentures to C
------------------------------------------------------------------
CARE Ratings revised the ratings on certain bank facilities of
Jharkhand Road Projects Implementation Company Limited (JRPICL),
as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Non-Convertible (1571.13) CARE C; Issuer not cooperating;
Debentures (NCD) Revised from CARE D; Issuer Not
Cooperating; Based on best
available information
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated April 4, 2019, placed the
ratings of JRPICL under the 'issuer non-cooperating' category as
JRPICL had not paid the surveillance fees for the rating exercise
as agreed to in its Rating Agreement. Although JRPICL has submitted
partial information for rating review, it continues to be
non-cooperative despite repeated requests for adherence to Rating
Agreement clauses. Resultantly it continues to be under "Issuer
non-cooperating" category in line with CARE's extant policy in
respect of non-cooperation by Issuer. CARE has reviewed the rating
on the basis of the information as submitted by the Company.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating(s).
Timely debt servicing of the aforementioned debentures have been
confirmed by Debenture Trustee since September 2019. The revision
in the long term ratings assigned to Non-Convertible Debentures
(NCDs) of the Company takes into consideration the timely debt
servicing by the Company since September 2019.
Despite structured payment mechanism in place and adequate
liquidity, the Company had defaulted in its payment obligations due
on January 21, 2019. The default was made despite of Debenture
Trustee (on instructions received from debenture holders) directing
the escrow bank to process the payment on due date to debenture
holders. However, the same was not adhered to, leading to default
in interest/principal payment to debenture holders.
Based on the ability of a particular company to repay debt and
interest, the Appellate Tribunal had classified the total debt of
IL&FS and its group companies in to three loan categories, Green,
Amber and Red. Previously, keeping in view the financial position
and ability of JRPICL to service debt, the Loan w.r.t. JRPICL was
classified under Amber category.
Subsequent to execution of a Master Term Agreement with
modification in terms of debentures after payment of all the dues
to debenture holder till July 20, 2019 and subsequently to
operational creditors of JRPICL and accrued & unpaid interest due
to unsecured lender (ITNL) from the escrow account, the Company has
been reclassified as Green entity.
As per the terms of MTA, after payment of all the dues to debenture
holder till July 20, 2019, payments amounting to INR167.50 crore
were allowed from escrow account to settle overdue of operational
creditors of JRPICL, and pay accrued & unpaid interest due to
unsecured lender (ITNL) till June 30, 2019. As per the revised
structure, a defined repayment schedule has been stipulated with a
fixed interest rate of 8.4% p.a. in line with debenture holders.
Out of the principal outstanding to unsecured lenders amounts to
INR815.99 crore, loans amounting to INR185 crore (non-interest
bearing) will be repaid in one shot repayment in September 2029 and
balance will be repaid in unequal quarterly instalments from Oct
20, 2019 to Oct 20, 2029. It has been agreed by all the parties to
MTA that in the event the cash flows of the issuer are insufficient
to discharge the amounts as fallen due on the day such payment is
to be made to them, then the cash flows of the Company would be
utilized first to the extent of clearing the secured overdue amount
to debenture holders before any payment is made to unsecured
lenders. Though with reduction in interest rate, the interest
expense will reduce going forward but considering the repayments to
be made to unsecured lenders along with secured lenders, the debt
service obligations of the Company will increase thereby impacting
the Debt servicing capability of the company keeping in mind the
fixed annuity payments from Government of Jharkhand (GoJ) with no
upside. All the 5 stretches continue to receive semi-annual annuity
payments which are spread over 8 months in a year. Also all the
annuities are transferred to master escrow account and thus there
is pooling of funds in master escrow account.
In addition, certain modifications have been made in the terms of
Debentures diluting the requirement of DSRA, lowering the O&M
budget and amending the method of DSCR calculation.
The Rating continues to be affected by weak credit profile of
sponsor and O&M contractor. With downward revision in budget
estimates for O&M and Major Maintenance as against previous
estimates, any increase in the actual expenditure may not be
fulfilled by the contractor. Thus, ensuring the quality of
maintenance activity within the limited budget would be key
rating monitorable.
As per the LIE report for the month of March 2020, Major
Maintenance work is behind schedule. Poor and delayed maintenance
may lead to imposition of damages and or deduction in annuities
going forward. CARE also takes in to consideration the delay in
receipt of annuity from GoJ with no annuities received for 2
project stretches pertaining to FY 2020 and none received for
Q1FY21 which were due. Thus, timely receipt of annuity would be a
key rating sensitivity.
Rating Sensitivities
Positive Factors
1. Receipt of pending annuity and timely receipt of annuities
without deductions for all the project stretches going
forward.
2. Ability to complete O&M activity within the budgeted cost
3. Initiate Major Maintenance on the pending stretches and
completion of the MM activity in line with the standards
of respective Concession Agreements
Negative Factors
1. Deductions in Annuity receipts
2. Delay in servicing of both secured and unsecured debt.
3. Any change in structured payment mechanism, affecting
the company's debt servicing ability adversely.
Detailed description of the key rating drivers
Key Rating Strengths
* Reclassified as Green Entity by NCLAT and regular debt servicing
since September 2019: Considering the debt servicing capability of
the Company, it has been reclassified as a Green entity. The Master
Term Agreement executed for this purpose modifies certain terms for
debenture holders diluting DSRA requirement and O&M budget going
forward with reduction in rate of interest. Further, as per the
modified terms, any surplus after meeting operational expenses,
statutory dues, topping up reserve requirements and debt servicing
due to both debentures holders and unsecured lenders, would be
utilized proportionately in prepaying the principal outstanding of
debenture holders and unsecured lenders in inverse order of
maturity. The same shall not be used for distribution of dividend
to sponsors. Both the Company and the Debenture Trustee have
confirmed timely debt servicing without delays and defaults.
* Diversified Annuity streams: JRPICL has achieved COD for all the
five stretches; with COD for the last stretch being achieved on
30th November 2014. However, for balance 7.6 kms stretch in
Chaibasa Kandra Chowka (CKC) project, COD was achieved on January
31, 2017. All the 5 stretches continue to receive semiannual
annuity payments which are spread over 8 months in a year. Also all
the annuities are transferred to master escrow account and thus
there is pooling of funds in master escrow account.
Key Rating Weaknesses
* Weakened credit profile of Sponsor i.e. ITNL: Rating of main
sponsor ITNL continues to be CARE D, INC on account of continuing
delays and defaults as confirmed by lenders and disclosures by ITNL
on stock exchanges in its debt servicing. ITNL is also the O&M
contractor for undertaking the routine as well as major maintenance
activity for the project. Considering current credit profile of
ITNL, its ability to support the project in times of need as
sponsor and O&M contractor is restricted. Though, as per MTA, all
other existing sponsor undertakings such as cost overrun or
additional funding requirement will stand suspended for ITNL and
IL&FS group.
IL&FS on December 18, 2018 invited expression of interest for
potential acquisition of IL&FS group's equity stake/interest in
certain road assets and businesses including JPRICL.
CARE understands that based on the information as submitted by the
Company, the bid received for JPRICL were lower than the Fair
Market Value as determined by two independent valuers appointed by
IL&FS Board for the valuation. Since the bid received was lower,
the IL&FS Board has rejected the bid. Subsequently, the IL&FS Board
has proposed the setting up of an Infrastructure Investment Trust
(InvIT) for resolution of ITNL SPVs where either no bid was
received or the bid was rejected due to it being lower than the
FMV. JPRICL is also included in the list of ITNL SPVs being
considered for inclusion in the InvIT. It is currently in the
process of registration of the InvIT with SEBI.
* Exposure to O&M and Major Maintenance risk: Fixed price contract
for O&M and Major Maintenance continues to be with ITNL, through
one of its group company, Elsamex Maintenance Services Ltd (EMSL).
As per the terms of MTA, an amendment in O&M agreement was agreed.
As per the amended contract for all 5 projects, the contract price
for O&M and Major Maintenance has been revised downwards. The price
as per the amended contract is fixed (inclusive of applicable
taxes) and agreed by the debenture holders as part of MTA. The
revised contracted price is almost in line with the CARE's
benchmark considering the projects being state highways and annuity
based. Further, keeping in view the weak credit profile of ITNL
(CARE D, INC), no comfort from the fixed price contract can be
drawn as in case of any shortfall in routine and well as periodic
maintenance arise, ITNL may not be in a position to meet the same.
Thus, ability of undertaking O&M within agreed budget in a timely
manner as per the prescribed standard would remain a key rating
sensitivity.
* Delayed Major Maintenance: As per the LIE report for the month of
March 2020, Major Maintenance work is behind the schedule and
considering the COD achieved, Major Maintenance work should have
been completed till now. However, work on 3 project stretches are
still in progress and work on the remaining 2 stretches are yet to
begin till June 2020. Further, Issues with respect to slippages,
cracks, potholes etc have been observed across all locations.
Continued poor Major Maintenance activity leading to levying of any
damages in the form of reduced annuity from the Authority would be
a key rating monitorable.
* Delays in receipt of Annuity: All the 5 stretches have been
receiving annuity for at least 4-5 years in the past with slight
delays. However, in FY 2020, annuity payment for 2 of its projects
(RRR and AK) due on 22-03-2020 and 31-01-2020 for RRR and AK
respectively has not been received so far. In addition, no
annuities have been received in FY 21 so far out of the annuities
due till now (pertaining to 3 road stretches). Based on CARE
Ratings' discussion with one of the investor, CARE understands that
the non-receipt of annuity was on account of delay in site visit
initially which was further delayed due to Covid. However, the site
visit has since been conducted and recommendation for release has
been made to the relevant department and the annuity is expected to
be received by July 2020.
With annuity receipts being the major source of income, timely
receipt thereof is of paramount importance and requires close
monitoring. Delay in receipt of Annuity will increase the cash flow
mismatch for timely debt servicing. Thus, receipt of pending
annuity and timely receipt of annuities without any deductions for
all the project stretches going forward remains a key rating
sensitivity.
* Moderate credit profile of annuity provider (counter party credit
risk): JRPICL's project stretches are annuity-based, under which
JRPICL will get semi-annual annuity payments from GoJ. It is
exposed to counter party credit risk as Dept. of Road
Construction, GoJ is the sole party. The rating gets constrained by
the higher dependence of the state on contributions and allocations
from the Center in the form of grants and share in central taxes.
* Dilution of DSRA and MMRA requirement: As per the modified terms,
the requirement for DSRA has been diluted. The Company is now
required to maintain a DSRA equivalent to aggregate of principal
and interest of ensuing 3 months due and payable in relation to
both debenture holders and unsecured loan. The Company had created
a DSRA of INR213.55 crore on March 31, 2018 upfront equivalent to
next 9 months of peak debt servicing (principal and interest) in
liquid mutual fund investments. The same was required to be
maintained throughout the tenure of NCD. However, the balance as on
December 31, 2019 stands at INR85.71 crore. Latest position has not
been provided by the Company so far.
As per the terms of Debentures, the Company was required to
maintain major maintenance reserve as per the Base Case Business
Model for the purpose of meeting major maintenance expenses in
relation to each of the projects. Major Maintenance Expenses in
succeeding 6 months to be withdrawn from the Escrow Account and be
deposited in MMR Sub Account. As on December 31, 2019, the
outstanding balance in MMRA was INR133.30 crore. However, the
latest position of the account has not been submitted by the
Company so far. With reduction in Major Maintenance cost the
reserve requirement will also reduce and thus erode the cushion
available.
Liquidity (Poor):
Considering the debt servicing for both debentures and unsecured
debt as due in FY 2021 being more than INR300 crore, the cash
accruals from the operations will not be sufficient to meet the
debt servicing. Though, sufficient balance would be available to
meet debt servicing for debenture holders. Based on the information
as submitted to CARE, as on December 31, 2019, the cash balance in
Escrow account was INR65 crore along with MMRA of INR133.31 crore
and DSRA of INR85.71 crore. However, the latest balances have not
been made available to CARE so far. Further Audited/Provisional
Financials for FY 2019 and FY 2020 has also not been submitted.
The Government of Jharkhand (GoJ) has conceptualized a
comprehensive programme titled the Jharkhand Accelerated Road
Development Programme (JARDP) to improve road infrastructure in the
state through Public Private Partnership framework. IL&FS [rated
CARE D, INC] won the bid and a Programme Development Agreement
(PDA) was signed between GoJ and IL&FS Group for the improvement of
1500 km lane of selected project road corridors. Certain road
stretches had been selected for development under this programme.
The programme was being implemented under an SPV named Jharkhand
Accelerated Road Development Company Limited (JARDCL), a JV between
IL&FS group and GoJ with shareholding pattern in ratio of 74:26
respectively. In terms of the PDA, the GoJ and IL&FS group may take
up the financing, construction, operation and maintenance of the
roads either through JARDCL or through separate SPV's incorporated
by GoJ and/or IL&FS. Accordingly, IL&FS group incorporated JRPICL
for undertaking the design, engineering, financing, procurement,
construction, operation and maintenance of the programme, on Build,
Operate & Transfer (BOT) Annuity Basis. The promoters of JRPICL are
ITNL (rated CARE D; Issuer Not Cooperating, 93.43%) and IL&FS
(rated CARE D, 6.57%). Separate Concession Agreements (CAs) have
been signed between the GoJ (annuity provider), JARDCL (JV partner
of GoJ for road development) and JRPICL (as concessionaire) for
implementation of the projects in phases. JRPICL has implemented
five different stretches of roads under JARDP details are provided
above. All the projects are implemented in one balance-sheet though
they have separate escrow arrangement and concession agreement for
individual project lenders.
KALPANA SHIVHARE: CARE Lowers Rating on INR3.50cr Loan to C
-----------------------------------------------------------
CARE Ratings revised the ratings on certain bank facilities of
Kalpana Shivhare (KSH), as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank 3.50 CARE C; Stable; Issuer not
Facilities cooperating; Revised from
CARE B; Stable; ISSUER NOT
COOPERATING on the basis of
best available information
Long-term/Short- 5.00 CARE C; Stable/CARE A4;
term Bank Issuer not cooperating;
Facilities Revised from CARE B;
Stable/CARE A4; ISSUER NOT
COOPERATING on the basis of
best available information
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated June 5, 2019, placed the
rating of KSH under the 'Issuer noncooperating' category as KSH had
failed to provide information for monitoring of the ratings as
agreed to in its rating agreement. KSH continues to be
non-cooperative despite repeated requests for submission of
information through e-mails, phone calls and a letter dated June
8, 2020, June 11, 2020 and June 18, 2020. 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.
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 assigned to the bank facilities of KSH have been
revised on account of non-availability of requisite information for
monitoring the ratings.
Detail description of the key rating drivers
At the time of last rating on June 5, 2019, the following were the
rating strengths and weaknesses
Key rating weaknesses
* Fluctuating Total Operating Income with moderate profitability:
Total Operating Income (TOI) of the firm has witnessed fluctuations
during the past three financial years ended FY18 on account of the
nature of the business as it depends on the number of shops
allotted. During FY18, TOI of the firm has improved marginally by
1.19% over FY17. PBILDT margin has also increased mainly due to
lower cost of materials consumed and remained at 3.61% in FY18 as
compared to 3.51% in FY17. However, due to higher interest and tax
expenses, PAT margin declined marginally by 13 bps and remained at
0.87% in FY18.
* Moderate solvency position and weak debt coverage indicators:
The capital structure of the firm stood moderate with an overall
gearing of 0.74 times as on March 31, 2018. Further, debt coverage
indicators of the firm stood weak marked by total debt to GCA
deteriorated as against March 31, 2017 mainly on account full
utilization of working capital bank borrowings as on balance sheet
date. Moreover, interest coverage ratio remained moderate at 1.58
times in FY18 improved from 1.51 times in FY17 on account of
improvement in operating margin.
* High business risk due to regulated nature of liquor industry:
The Indian liquor industry is highly regulated. The industry is
witnessing high taxes and numerous regulations from government
which impacts the pricing flexibility of the industry. The state
governments are also given liberty to enact the bye-laws for liquor
industry on their own hence any significant policy changes
adversely affect the whole industry.
Key rating strengths
* Rich experience of promoters in liquor trading business: KSH has
been in the liquor business from the last 10 years. Firm is belongs
to Shivhare Group in Madhya Pradesh trading in liquor business more
than a decade since 1990.
* Favorable demand outlook with steady increase in consumption of
liquor: Indian Liquor industry is one of the growing industries
despite being subjected to high taxes and innumerable regulations
by government. In addition, changing consumer preference towards
premium varieties has resulted in improvement in sales mix of
industry. Hence, Indian liquor industry is envisaged to continue
the trend of steady growth supported by increasing demand led
volume growth.
Incorporated in 1990, M/s Kalpana Shivhare (KSH) is a sole
proprietorship firm which is into the business of retailing of
alcohol. The firm also own and operates petrol pump under the name
M/s Patel & Sons in Madhya Pradesh. KSH is part of Shivhare Liquor
Group which is based out of Madhya Pradesh. KSH undertakes retail
trade of Indian made foreign liquor (IMFL), country liquor (CL),
wine etc and holds retail license for liquor shops in the state of
MP. KSH has been allotted retail liquor license in different
districts of Madhya Pradesh. The firm enters into open tendering
process every year to avail license for the retailing of the
liquor. Depending upon the allotment of shops during tendering, the
number of shops held by the company varies every year.
KHUSHIYA INDUSTRIES: CARE Keeps D on INR20cr Debt in NonCooperating
-------------------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Khushiya
Industries Pvt. Ltd. (KIPL) continues to remain in the 'Issuer Not
Cooperating' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term bank 20.80 CARE D Issuer not cooperating;
facilities Based on best available
information
Detailed Rationale & Key Rating Drivers
CARE had, vide press release dated February 6, 2018, placed the
rating of KIPL under the 'Issuer Non-cooperating' category as the
company had failed to provide information for monitoring of the
ratings and had not paid the surveillance fees for the rating
exercise as agreed to in its Rating Agreement. Further, CARE had
revised the rating of KIPL to 'CARE D; Issuer Not Cooperating' vide
its press release dated May 22, 2019 due to on-going delays in debt
servicing obligations.
KIPL continues to be non-cooperative despite requests for
submission of information through e-mails, phone calls and a
letter/e-mail dated June 11, 2020. 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.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating(s).
Detailed description of the key rating drivers
At the time of last rating on May 22, 2019, the following was the
rating weakness (updated based on the best available information).
Key Rating Weaknesses
* Delays in servicing of debt obligations: As per recent
telephonic interaction with lenders of KIPL, the lenders have
confirmed that there are delay/ irregularities in serving of debt
obligations by the company and the account has been treated as
NPA.
Banaskantha, Gujarat based, KIPL was incorporated in 2012 by Mr.
Mehul Thakkar, Mr. Dalpatram Thakkar and Ms. Ritaben Thakkar. KIPL
is engaged in the business of extraction of mustard oil and castor
oil. KIPL operates from its manufacturing facilities located at
Banaskantha with an installed capacity of 30,000 metric tons per
annum (MTPA) as on March 31, 2016. KIPL entered into forward
integration in the value chain by setting up solvent extraction
plant with total installed capacity of 90,000 MTPA in February
2016, which commenced commercial production from February 2016.
LAKSHMI PRECISION: CARE Keeps D Debt Ratings in Not Cooperating
---------------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Lakshmi
Precision Screws Limited (LPS) continues to remain in the 'Issuer
Not Cooperating' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term bank 115.50 CARE D Issuer not cooperating;
facilities Based on best available
information
Short-term bank 77.00 CARE D Issuer not cooperating;
facilities Based on best available
Information
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated March 13, 2019, placed the
rating of LPS under the 'issuer non-cooperating' category as LPS
had failed to provide information for monitoring of the rating. LPS
continues to be non-cooperative despite repeated requests for
submission of information through e-mails, phone calls and a letter
dated June 15, 2020. 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.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating(s).
Detailed description of the key rating drivers
At the time of last rating on March 13, 2019, the following was the
rating weaknesses (updated for the information available from stock
exchange):
Key Rating Weaknesses
* Ongoing delays in debt servicing: There are ongoing delays in
the servicing of the debt obligations by LPS. The company has been
classified as Non-Performing Asset (NPA) by the banks. Initiation
of Corporate Insolvency Resolution Process (CIRP): By the order of
the National Company Law Tribunal (NCLT), CIRP was initiated
against LPS under the provisions of Insolvency and Bankruptcy Code,
2016 (IBC). The petition for initiation of the CIRP was filed by an
operational creditor of the company. The Insolvency Resolution
Professional (IRP) appointed by NCLT had constituted a Committee of
Creditors (COC) which approved the resolution plan submitted by a
creditor. Further, the COC also authorized IRP to file an
application for the approval of the resolution plan from the NCLT.
Lakshmi Precision Screws Ltd (LPS) was incorporated in January 1968
as a private limited company. Subsequently, the company was
reconstituted as a public limited company in 1972. LPS is engaged
in the manufacturing of high-tensile fasteners with total installed
capacity of 28,432 Metric Tonnes Per Annum (MTPA), as on March 31,
2017. The company currently has four manufacturing units, three are
situated in Rohtak and one in Gurgaon, Haryana. The company caters
to various sectors such as wind Energy, Oil & Gas, Locomotives,
Automobiles, Agriculture Equipments (tractors) and different
industrial requirements. Apart from this, the company is also
engaged in trading of high-tensile fasteners.
LATA EXPORTS: CARE Keeps D Debt Ratings in Not Cooperating
----------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Lata
Exports Apparels Private Limited (LEAPL) continues to remain in the
'Issuer Not Cooperating' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term bank 7.50 CARE D Issuer not cooperating;
facilities Based on best available
information
Short-term Bank 6.75 CARE D; Issuer not cooperating;
Facilities Based on best available
Information
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated May 6, 2019, placed the
rating(s) of LEAPL under the 'issuer non-cooperating' category as
Lata Exports Apparels Private Limited had failed to provide
information for monitoring of the rating and had not paid the
surveillance fees for the rating exercise as agreed to in its
Rating Agreement.
LEAPL continues to be non-cooperative despite repeated requests for
submission of information through e-mails, phone calls and a
letter/email dated June 1, 2020. 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.
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 takes into account the ongoing delays in the debt
servicing.
Detailed description of the key rating drivers
At the time of last rating on May 6, 2019, the following were the
rating strengths and weaknesses:
Key Rating Weakness
* Ongoing delays in debt servicing: As per the interaction with
the banker, there are ongoing delays in debt servicing and the
account has been classified as NPA.
Incorporated in 1996 by the Karthikeyan family, Lata Exports
Apparels Private Limited (LEAPL) is engaged into manufacturing of
ready-made garments and uniforms for men, women and children. It
exports its products to USA, UK, Germany, Mexico and Australia
(contributing ~56.30% to total income) and domestically to
retailers and wholesalers (contributing ~13.72% to total income).
Furthermore, LEAPL undertakes job work of garment manufacturing for
other entities and brands such as Ashima Limited and India Fashions
Limited (contributing ~29.98% to total income during FY16). LEAPL
has its manufacturing facility at Bhiwandi with an installed
capacity of 75,000 pieces per month having capacity utilisation of
65% during FY16.
NAKKHEERAN PUBLICATIONS: CARE Keeps D Ratings in Not Cooperating
----------------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Nakkheeran
Publications (NP) continues to remain in the 'Issuer Not
Cooperating' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term bank 12.95 CARE D Issuer not cooperating;
facilities Based on best available
information
Short-term bank 0.75 CARE D Issuer not cooperating;
facilities Based on best available
Information
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated March 29, 2019, placed the
rating(s) of NP under the 'Issuer non-cooperating' category as NP
had failed to provide information for monitoring of the rating. NP
continues to be noncooperative despite repeated requests for
submission of information through e-mails, phone calls and email
dated April 28, 2020 and April 29, 2020. 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.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating.
Detailed description of the key rating drivers
At the time of last rating on March 29, 2019, the following were
the rating weaknesses:
Key Rating Weakness
* Ongoing delays in meeting debt obligations: The firm was unable
to generate sufficient cash flows leading to strained liquidity
position resulting in ongoing delays in meeting its debt
obligations in time.
Chennai based, Nakkheeran Publications (NP) was incorporated in the
year 1988 by Mr. Nakkheeran Gopal. The firm is engaged in printing
of magazines and journals.
NEEL KRISHNA: CARE Keeps D on INR10cr Loans in Not Cooperating
--------------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Neel
Krishna Brothers (NKB) continues to remain in the 'Issuer Not
Cooperating' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term bank 10.03 CARE D Issuer not cooperating;
facilities Based on best available
information
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated May 27, 2019, placed the
rating of NKB under the 'Issuer noncooperating' category as NKB had
failed to provide information for monitoring of the ratings as
agreed to in its rating agreement. NKB continues to be
non-cooperative despite repeated requests for submission of
information through e-mails, phone calls and a letter dated June 8,
2020, June 11, 2020 and June 18, 2020. 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.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating.
Detail description of the key rating drivers
At the time of last rating on May 27, 2019, the following was the
rating weakness
Key rating weaknesses
* Delays in debt servicing: As per banker interaction, there were
delays in debt servicing.
Ujjain (Madhya Pradesh) based Neel Krishna Brothers (NKB) was
formed as a proprietorship concern in April, 2000 by Mr. Kishore
Kumar Jaiswal. NKB is engaged in the business of trading, sorting
and processing of grains and pulses as well as manufacturing of
wheat flour.
NEW PRINTS: CARE Keeps D on INR10cr Bank Loans in Not Cooperating
-----------------------------------------------------------------
CARE Ratings said the rating for the bank facilities of New Prints
India Private Limited (NPI) continues to remain in the 'Issuer Not
Cooperating' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term bank 6.22 CARE D Issuer not cooperating;
facilities Based on best available
information
Short-term bank 3.78 CARE D Issuer not cooperating;
facilities Based on best available
Information
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated May 23, 2019 placed the
ratings of NPI under the 'issuer non-cooperating' category as New
Print India Private limited had failed to provide information for
monitoring of the rating. New Print India Private limited continues
to be non-cooperative despite repeated requests for submission of
information through e-mails, phone calls and a letter/email dated
June 23, 2020, June 25, 2020. 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.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above ratings.
Detailed description of the key rating drivers
At the time of last rating on May 23, 2019, the following were the
rating weakness:
The ratings take into account the ongoing delays in debt servicing
obligations due to stressed liquidity position.
New Prints India Private Limited (NPI) was incorporated in 1979 by
Mr. Subhash Goel and Mr Suresh Goel. New Prints Private Limited
(NPI) is engaged in manufacturing of paper products like books,
calendar, diary etc. The company is into offset printing, pre-press
and post-press (i.e. binding, stitching, lamination etc)
activities. The raw material used in manufacturing includes paper
reels/rolls, chemicals & inks, printed covers, nylo polymer plates
and CNG which the firm procures mainly from dealers located in
Noida and Delhi. The end users of the products manufactured by the
firm are government departments, banks, school, colleges and
household sector.
PANAMA AGRICULTURE: CARE Keeps D on INR1cr Debt in Not Cooperating
------------------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Panama
Agriculture Private Limited (PAPL) continues to remain in the
'Issuer Not Cooperating' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term bank 1.25 CARE D Issuer not cooperating;
facilities Based on best available
information
Note: Term loan sanctioned from Bank of Maharashtra was withdrawn
based on No Due Certificate from the lender
Detailed description of the key rating drivers
CARE had, vide its press release dated March 29, 2019, placed the
rating of PAPL under the 'issuer non-cooperating' category as PAPL
had failed to provide information for monitoring of the rating as
agreed to in its rating agreement. PAPL continues to be
non-cooperative despite repeated requests for submission of
information through email dated June 11, 2020, June 15, 2020, June
18, 2020, June 24, 2020 and numerous phone calls. 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.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating.
At the time of last rating on March 29, 2019, the following were
the rating weaknesses:
Detailed description of the key rating drivers
Key Rating Weaknesses
* Delay in debt servicing obligations and weak liquidity position:
There have been instances of delays in repayment of principal and
interest obligation of term facility. The delays were on account of
weak liquidity position.
Pune based, Panama Agritech Private Limited was promoted by Ladkat
brothers with Mr. Sameer Ladkat as Chairman and Mr. GautamLadkat as
Director. Further, since Feb. 8, 2016, the name of the company was
changed to PAPL.The company is engaged in providing services for
scientific and safe storage of grains in silo bags. The company
primarily provides its services to Madhya Pradesh Warehousing and
Logistic Corporation (MPWLC) on rental basis at a pre agreed price
per quintal.
PATE FUTURE: CARE Keeps D on INR45cr Debt in Not Cooperating
------------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Pate Future
Constructions LLP (PFCL) continues to remain in the 'Issuer Not
Cooperating' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term bank 45.00 CARE D Issuer not cooperating;
facilities Based on best available
information
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated March 11, 2019, placed the
rating of PFCL under the 'issuer non-cooperating' category as PFCL
had failed to provide information for monitoring of the rating as
agreed to in its Rating Agreement. PFCL continues to be
non-cooperative despite repeated requests for submission of
information through email letter dated June 11, 2020, June 15,
2020, June 18, 2020, June 24, 2020, and numerous phone calls. 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.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating.
Detailed description of the key rating drivers
At the time of last rating on March 11, 2019, the following were
the rating weaknesses
Key Rating Weaknesses
* Delay in debt servicing obligations: There are continuous delays
in debt servicing obligations and the account continues to remain
in NPA category.
Pate Future Constructions LLP (PFLP) is a limited liability
partnership firm formed on January, 2015 and belongs to Pune based
Pate Developers. PFCL is formed for developing a budget residential
development under the name "LIFE MAXIMA" at Kirkatwadi, Pune.
PINAKIN PLASTOFORMING: CARE Keeps D Debt Ratings in Not Cooperating
-------------------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Pinakin
Plastoforming Limited (PPL) continues to remain in the 'Issuer Not
Cooperating' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term bank 8.00 CARE D Issuer not cooperating;
facilities Based on best available
information
Short-term Bank 0.50 CARE D; Issuer not cooperating;
Facilities Based on best available
Information
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated Sept. 4, 2019, placed the
rating(s) of PPL under the 'issuer non-cooperating' category as PPL
had failed to provide information for monitoring of the rating. PPL
continues to be non-cooperative despite repeated requests for
submission of information through e-mails, phone calls and a
letter/email dated June 12, 2020, June 16, 2020 and June 22, 2020.
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.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating(s).
Detailed description of the key rating drivers
At the time of last rating on Sept. 4, 2019, the following was the
rating weakness:
Key Rating Weaknesses
* On-going delay in debt servicing: Owing to weak liquidity
position, there has been an irregularity in debt servicing.
Vadodara-based (Gujarat) PFL was incorporated in 2002 by Joshi
family as a private limited company and changed its constitution to
closely held limited company during February 2016. The operation of
PFL is currently managed by Mr. Dinesh Joshi, Mr. Divyesh Joshi and
Ms. Pratiksha Joshi. PFL is engaged into manufacturing
Polypropylene (PP) Disposable plastic products such as disposable
glass, cups etc. PFL is operating from its sole manufacturing unit
located in Vadodara(Gujarat), having installed capacity of 1,500
Metric Tonne Per Annum (MTPA) as on March 31, 2017. Siddhivinayak
Industries and Shri Sainath Industries are associated entities
managed and owned by members of Joshi family. Both entities are
engaged into manufacturing and trading of plastic disposables.
PRIMAFLEX: CARE Keeps D on INR8.30cr Debt in Not Cooperating
------------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Primaflex
(PF) continues to remain in the 'Issuer Not Cooperating' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term bank 8.30 CARE D Issuer not cooperating;
facilities Based on best available
information
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated July 23, 2019, placed the
rating of PF under the 'Issuer non-cooperating' category as PF had
failed to provide information for monitoring of the ratings as
agreed to in its rating agreement. PF continues to be
non-cooperative despite repeated requests for submission of
information through e-mails, phone calls and a letter dated June 9,
2020, June 15, 2020 and June 18, 2020. 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.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating.
Detail description of the key rating drivers
At the time of last rating on July 23, 2019, the following was the
rating weakness:
Key rating weaknesses
* Delays in debt servicing: As per banker interaction, there were
delays in debt servicing.
Primaflex (PFX) was formed in 2015 as a partnership concern by Mr.
Rishipal Bhatiya and Mr. Mishipal Bhatiya in Indore (Madhya
Pradesh) with an objective to set up a green field project for
manufacturing of printed and laminated flexible packaging. PFX
envisaged total project cost of INR8.96 crore towards the project
envisaged to be funded through term loan of INR6.30 crore and
promoter's contribution of INR2.66 crore in form of partner's
capital and unsecured loan from partners. PFX had envisaged that
project would be completed by last week of July, 2017 and is
expected to commence its operations from last week of July, 2017.
The plant has the processing capacity of 200 Metric Tonnes Per
Month (MTPM) of flexible packaging.
PV KNIT FASHIONS: CARE Raises Rating on INR5.05cr LT Loan to C
--------------------------------------------------------------
CARE Ratings revised the ratings on certain bank facilities of PV
Knit Fashions (PKF), as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long term Bank 5.05 CARE C; Stable; Revised from
Facilities CARE D and removed from Issuer
Not cooperating category
Short term Bank 3.15 CARE A4 Revised from CARE D
Facilities and removed from Issuer not
cooperating category
Detailed Rationale & Key Rating Drivers
The revision in the rating assigned to the bank facilities of PKF
takes into account moderate improvement in the liquidity position
although continues to remain stretched. The rating also factors
increase in total operating income during review period, increase
in profitability margins albeit fluctuating, improved capital
structure during review period, established business relations with
customers and suppliers.
The rating continues to be tempered by small scale of operations
along with partnership nature of constitution, moderately weak debt
coverage indicators, working capital intensive nature of
operations, profitability margins susceptible to volatility in raw
material prices and foreign exchange rates and presence in a highly
fragmented garment industry. However, the rating continues to
derive benefits from long experience of partners in textile
industry with established track record of entity and in-house
designing capabilities along with operational support from
associate concern.
Rating sensitivities
Positive Factors
* Consistent increase in the firm's scale of operations above
INR35 crore while maintaining minimum PBILDT margin of 13%
on a sustained basis.
* Improvement in overall gearing by 1.00x and interest coverage
above 3.5x in future years.
* No capital withdrawals by the partners thereby keeping the
Tangible Net worth intact.
Negative Factors
* Decrease in scale of operations along with decline in
profitability margins with PBILDT margin falling below 9%
in future.
* Further elongation in operating in cycle future years.
* Any stress in liquidity position results in delays or
defaults in debt servicing going forward.
Key Rating Weaknesses
* Small scale of operations along with partnership nature of
constitution: The firm's size of operations stood small
however scaling up during the review period. The total
operating income has increased to INR21.74 crore in FY19 as
against INR20.08 crore in FY18 coupled with satisfactory
networth base of INR7.42 crore as of March 31, 2019.
PKF is a partnership nature of business wherein the inherent
risk of withdrawal of capital by the partners at the time of
their personal contingencies resulting in erosion of capital
base leading to adverse effect on capital structure.
* Moderately weak debt coverage indicators: The interest
coverage
ratio of the firm deteriorated during FY18 to 1.77x from 2.20x
in FY17, due to decrease in PBILDT levels along with marginal
increase in interest and finance charges. However, in FY19,
the same has improved to 1.95x owing to increase in PBILDT,
despite increase in interest and finance charges. With
increase in debt levels coupled with decrease in accruals,
TD/GCA of the firm has deteriorated to 16.53x in FY18 and the
same has improved in FY19 to 10.28x, owing to increase in the
cash accruals as against reduction in debt levels.
* Working capital intensive nature of operations: Since the PKF
is into manufacturing of knitted garments, the major raw
material used to manufacture the garment is cotton yarn and
the price of cotton yarn is being volatile which adds
significant risk to the business. Hence the firm has to hold
the sufficient stock of raw materials to meet continues
demand from customers. The inventory period stood elongated
at 97 days in the said period. The major raw materials that
include cotton yarn (90%), polyester which are sourced
domestically and availed a credit period of 60-65 days from
its suppliers and the firm also imports accessories such as
zip, button, labels, etc. from China by paying 100% of
payment as advance. PKF exports (100%) the goods to its
customers located at France, Sweden, Germany and offers
credit period upto 60-85 days.
* Profitability margins susceptible to volatility in raw
material prices and foreign exchange rates: PKF is engaged in
manufacturing and export of readymade garments business; 100%
of their sales are from exports and due to the export nature
of business. The firm is inherently exposed to foreign
exchange risk. To mitigate the risk, the firm books forward
contracts on the confirmed orders. The main raw material used
for the manufacturing of textiles is cotton yarn, prices of
cotton yarn being volatile which adds significant risk to the
business. In spite of having a well-diversified customer and
supplier base, fluctuating prices can affect the firm's
profit margins. Textile industry as a whole remains vulnerable
to various factors such as fluctuations in prices of cotton,
mobilization of adequate workforce and changes in government
policies. Any significant changes in such factors will have
direct impact on the business operations of the firm.
* Presence in a highly fragmented garment industry: With cluster
of textile players in and around Tirupur, the area is
burgeoning with both organized and unorganized players for
supply of power and weaving. So the firm faces intense
competition from both the segments. Hence the firm is also
constrained to provide more credit period to customers which
results in working capital intensive operations.
Key Rating Strengths
* Long experience of partners in textile industry with
established track record of entity: PKF was established in
January 1989 and has long established presence in the
industry. The firm was promoted by Mr. C. Kumarasamy, Mr. N.
Ramasamy and Ms. C.K. Meera, However in the year 2015 the
partners Mr. C. Kumarasamy & Ms. C. K. Meera retired and
partnership continued by Mr. N. Ramasamy as a Managing
partner appointing Ms. R. Vallinayaki as a partner. Both
the partners collectively have nearly three decades of
experience in the textile industry and their experience in
the apparel industry has benefited the business. The
promoters are supported by experienced management team
including managers and production staff who have experience
of more than two decades.
* In-house designing capabilities along with operational support
from associate concern: PKF has an in-house design development
department with an integrated manufacturing facility from
fabric dyeing to finishing. The firm develops its own
creations and specialty designs according to the taste and
preferences of the customers and the latest market trends.
PKF has installed latest technology machines for processing
and for other value added products like dying and printing,
embroidery and design, fabrication and stitching work with
experienced and skilled workforce and quality controls.
M/s P.M.V Dyeing Mills, a group concern of PKF is engaged in
dyeing and printing of cotton fabrics. PKF is supported by
their group concern and both the firms offer operational
support to each other as per requirement.
* Increase in total operating income during the review period:
The firm has reported increase in total operating income in
FY19 due to increase in sales volume on the back of increase
in order inflows from existing and new customers. This along
better sales realization which has supported the growth in
TOI by 9% in FY19. The firm has registered TOI of INR21.74
Crore in FY19 as against INR20.08 crore in FY18. PKF's 100%
of revenue driven through exports. Further in FY20, the
firm's sales volume has decreased backed by decrease in
price margin resulted in shortfall in the sales revenue
to INR17.87 crore(Prov.).
* Increase in profitability margins albeit fluctuating: During
FY18, the PBILDT margin of the firm has dropped by 168 bps to
7.59% due to increase in raw material costs, employees cost
and other operating expenses. Further in FY19, the same has
improved to 9.73% on account of increase in total operating
income coupled with decrease in fixed overheads such as sales
tax expenses and GST expenses. The PAT margin has declined to
2.34% in FY18 on account of decrease in absolute terms of
PBILDT and increased in in FY19 to 3.46% owing to increase
in absolute terms of PBILDT.
* Improved capital structure during the review period: The
firm's overall gearing deteriorated to 1.97x as of March 31,
2018 owing to rising debt levels. However, the same has
improved in FY19 on the back of improved networth base,
supported by infusion of capital by partners. This along with
scheduled repayment of term loans, has led to improvement in
the overall gearing to 1.16x during the said period. Due to
the aforesaid fact on term loan, the debt equity ratio has
improved and stood at 0.12x as on March 31, 2019 as against
0.28x as of March 31, 2018.
* Established business relations with customers and suppliers:
PKF has gained a list of dedicated customers who have been
with PKF for many years despite of high competition in
international market. The entire sales of the firm are order
based and mainly cater to the export market and the firm gets
repeated orders from these clients. The major customers of
PKF are located from France, Sweden and Germany. The firm
purchases raw materials from the suppliers domestically and
also imports raw materials from China.
Stretched Liquidity
Liquidity is stretched marked by its elongated operating cycle of
84 days, keeping the firm to rely highly on working capital bank
borrowings. The average utilisation of working capital facility
stood at 99% for last twelve months ended May 31, 2020. The current
ratio stood moderately satisfactory at 1.00x as on March 31, 2019
to meet out its short term debt obligations.
Further it has tightly matched accruals of INR0.83 crore to pay
against its term debt of INR0.86 crore as on March 31, 2019. The
firm has cash balance of INR0.03 crore as on March 31, 2019. The
firm has availed moratorium as per RBI announcement on COVID-19 for
all its bank facilities till August 2020.
PV Knit Fashion (PKF) was established in January, 1989 as a
partnership firm by Mr. N. Ramasamy as a Managing partner and
incoming partner, Ms. R. Vallinayaki. PKF is engaged in
manufacturing and exporting of readymade garments and Knits for
ladies, men's wear and kids wear. Their products ranges from T.
shirts, Polo shirts for men, Sweat shirts, Night wears, and Knits
for women and Men, Tracks, Shorts, Skirts, Trouser etc. PKF derives
its strength from their in-house designing, knitting, dyeing,
embroidering, printing, cutting, sewing and finishing and by being
acquainted with latest manufacturing technology. PKF is engaged
into order based manufacturing and generates over 100% of its total
income by exporting their products to traders based in Sweden,
France, Belgium and Switzerland.
RAHUL ELECTRONIC: CARE Lowers Rating on INR6cr Bank Loans to C
--------------------------------------------------------------
CARE Ratings revised the ratings on certain bank facilities of
Rahul Electronic Private Limited (REPL), as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank 6.00 CARE C; ISSUER NOT COOPERATING;
Facilities Revised from CARE B-; ISSUER
NOT COOPERATING; on the basis
of best available information
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated May 9, 2019, placed the
rating(s) of REPL under the 'issuer non-cooperating' category as
REPL had failed to provide information for monitoring of the rating
and had not paid the surveillance fees for the rating exercise as
agreed to in its Rating Agreement. REPL continues to be
non-cooperative despite repeated requests for submission of
information through e-mails, phone calls and a letter/email dated
May 28, 2020. 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.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating.
The rating has been revised on account of deterioration in the
financial risk profile of the company marked by decrease in the
scale of operations, deterioration in profit margins with net loss
incurred in FY19, deterioration in the capital structure and debt
coverage indicators during FY19 over FY18. CARE also views
information availability risk as a key factor in its assessment
of credit risk.
Detailed description of the key rating drivers
At the time of last rating on May 9, 2019, the following were the
rating strengths and weaknesses (updated for the information
available from Registrar of Companies):
Key Rating Weaknesses
* Modest scale of operations and net losses during FY19: REPL's
scale of operations remained modest with total operating income
stood in the range of INR73.70 crore to INR88.86 crore during
FY17-19. Given the trading nature of its operations, profit margins
remained low and the same have been fluctuating during the said
period. Moreover, the company has incurred net loss of INR1.72
crore in FY19 vis-à-vis net profit of INR0.07 crore in FY18.
* Leveraged capital structure and weak debt coverage indicators:
The capital structure of REPL stood distressed owing to eroded
tangible networth as on March 31, 2019. Further, with net losses
incurred, the debt coverage indicators also stood weak during
FY19.
* Working capital intensive nature of operations: The operations
of REPL are working capital intensive in nature with majority of
funds being blocked in inventory. On the other hand the company
receives lower credit from the suppliers which has resulted in high
level of utilization of its working capital limits.
* Highly competitive & fragmented nature of operations: REPL
operates in a highly competitive & fragmented industry environment
with a large number of players engaged into the trading of
electronics. Given this, the company faces stiff competition from
other small & medium players belonging to this segment. The said
competitiveness can be reflected in the low profit margins of the
company.
Key rating strengths
* Experienced promoters and long track record of operations: REPL
possesses a long track record of over two decades of operations in
trading in electronics. Further, the overall operations of REPL are
looked after by Mulchandani family, who possess an average of
two-decades of long standing experience in the activities of
trading.
* Diverse geographic presence offering multiple brand options:
REPL is engaged into retail trading of electronics and deals in
diverse consumer electronics of multiple brands and operates retail
stores which are situated at prime locations across the suburbs of
Mumbai and Palghar district.
Rahul Electronic Private Limited (REPL) was incorporated in the
year 1997 by Mulchandani family, and is engaged into trading of
consumer electronics (namely TV, mobile phones, refrigerators, home
entertainment system, air-conditioners, washing machines, and
microwaves). The company operates through ten retail stores across
Mumbai and Palghar under the name Rahul Electronic.
RRB ENERGY: CARE Keeps D on INR135cr Loans in Not Cooperating
-------------------------------------------------------------
CARE Ratings said the rating for the bank facilities of RRB Energy
Limited (REL) continues to remain in the 'Issuer Not Cooperating'
category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term/Short 40.00 CARE D; Issuer not cooperating;
term Bank Based on best available
Facilities information
Long-term bank 95.00 CARE D Issuer not cooperating;
facilities Based on best available
information
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated March 28, 2019 placed the
ratings of REL under the 'issuer non-cooperating' category as REL
had failed to provide information for monitoring of the ratings as
agreed to in its Rating Agreement. REL continues to be
non-cooperative despite repeated requests for submission of
information through phone calls and emails dated June 2, 2020 to
June 23, 2020. 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.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating(s).
Detailed description of the key rating drivers
At the time of last rating on March 28, 2019, the following were
the rating strengths and weaknesses
Key Rating Weaknesses:
* Ongoing Delays in Debt Servicing: The company has delays in the
servicing of interest for more than a month.
* Weak Financial Risk Profile: During FY19, the TOI of the company
decreased by ~37% to INR58.01 Cr (PY: INR91.88 Cr) with negative
PBILDT of - INR7.27 Cr (PY: INR9.24 Cr). As on March 31, 2019, the
company reported overall gearing of 2.83x (PY: 1.75x) on account of
losses at PAT level which result into decline in Networth of the
company to INR51.24 cr. in FY19 (PY: 81.35).
Incorporated in 1987, RRB Energy Limited engaged in the business of
manufacture, erection and commissioning of Wind Electric Generators
(WEGs) and also provides after-sales services and maintenance
services for WEGs. It currently manufactures WEGs with capacity of
225KW, 500KW and 600 KW. The company is ISO 9001:2008, ISO
14001:2004 and OHSAS 18001:2007 certified and has production plants
in Tamil Nadu, Maharashtra, Karnataka, Gujarat and Rajasthan. It
also has a government approved R&D facility which develops higher
MW capacity turbines.
S.G. POLYPLAST: CARE Lowers Rating on INR15cr LT Loan to 'D'
------------------------------------------------------------
CARE Ratings revised the ratings on certain bank facilities of S.G.
Polyplast Private Ltd (SGPPL), as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank 7.00 CARE D; ISSUER NOT COOPERATING;
Facilities Revised from CARE BB-; Stable;
ISSUER NOT COOPERATING; on the
basis of best available
information
Short Term Bank 15.00 CARE D; ISSUER NOT COOPERATING;
Facilities Revised from CARE A4; ISSUER NOT
COOPERATING on the basis of best
Available information
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated May 1, 2019, placed the
ratings of SGPPL under the 'Issuer non-cooperating' category as
SGPPL had failed to provide information for monitoring of the
rating. SGPPL continues to be non-cooperative despite repeated
requests for submission of information through e-mails, phone calls
and a letter/email dated June 15, 2020, June 3, 2020, May 14, 2020,
May 4, 2020, April 16, 2020, March 31, 2020. 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 sufficient to arrive at a fair rating.
Hence, based on the best available information in public domain
regarding the delay in timely repayment of its debt obligations,
CARE has downgraded its ratings on the bank facilities of SGPPL to
'CARE D/CARE D Issuer Not Cooperating' from 'CARE BB-; Stable/CARE
A4; Issuer Not Cooperating'.
The ratings on S.G. Polyplast Private Ltd's bank facilities will
now be denoted as CARE D; ISSUER NOT COOPERATING/ 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 ratings.
The rating has been revised by taking into account best available
information in public domain due to non-cooperation by S.G.
Polyplast Private Limited 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.
S. G. Polyplast Private Limited (SGPPL), incorporated on April 15,
2009 at Delhi by Mr. Ajit Kumar Gupta carry out the trading of
resins, polymers and other plastic raw materials. However, in the
year July 2014 the company was taken over by the Jindal Group been
promoted by Mr. Dalip Jindal along with his wife Mrs. Shaloo
Jindal. The company is engaged in import of pulses (Red Lentils,
Chickpeas, Green Peas, Yellow Peas, Pigeon Peas, Black Matpe, Green
Moong and Lentils) from countries like Singapore, China, Canada,
Australia, New Zealand and Russia. SGPPL sells its product mostly
in the domestic market through a network of wholesale dealers and
brokers.
S.R. INDUSTRIES: CARE Keeps D Debt Ratings in Not Cooperating
-------------------------------------------------------------
CARE Ratings said the rating for the bank facilities of S.R.
Industries Limited (SRIL) continues to remain in the 'Issuer Not
Cooperating' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term bank 29.33 CARE D Issuer not cooperating;
facilities Based on best available
information
Short-term bank 1.75 CARE D Issuer not cooperating;
facilities Based on best available
Information
Long/Short term 1.00 CARE D/CARE D; Issuer not
Bank Facilities cooperating; Based on best
available information
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated April 2, 2019, placed the
rating of SRIL under the 'issuer noncooperating' category as SRIL
had failed to provide information for monitoring of the rating.
SRIL continues to be noncooperative despite repeated requests for
submission of information through e-mails, phone calls and a letter
dated June 15, 2020. 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.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating(s).
Detailed description of the key rating drivers
At the time of last rating on April 2, 2019, the following was the
rating weaknesses (updated for the information available from stock
exchange):
Key Rating Weaknesses
* Ongoing delays in debt servicing: There are ongoing delays in the
servicing of the debt obligations by SRIL. The company has been
classified as Non-Performing Asset (NPA) by the banks.
* Weak financial risk profile: The financial risk profile of the
company remained weak, marked by small and declining scale of
operations with negative networth. During FY19 (refers to the
period April 1 to March 31), the total income of SRIL declined by
~33% on a year-on-year (y-o-y) basis to INR25.59 cr. from INR38.12
cr. in FY18. SRIL reported losses at PBILDT level in FY19 compared
to profits in FY18. The company continued to be in losses at net
level which increased in FY19 on a y-o-y basis. Further, the
solvency position of the company remained weak owing to losses at
the net level, leading to negative networth, as on March 31, 2019.
During 9MFY20 (Unaudited), the operating income of the company
declined by ~30% on a y-o-y basis to INR14.95 cr. from INR21.46 cr.
in the same period last year. The company remained in losses at net
level in 9MFY20 (Unaudited).
Established in 1989, SRIL is engaged in manufacturing of sports
footwear, chappals and sandals at its manufacturing unit located in
Una, Himachal Pradesh. The company was set up by Mr R C Mahajan and
Mr Yash Mahajan in 1989 for manufacturing of terry towel. The Terry
Towel business was subsequently sold in FY13 and the company
started manufacturing of footwears. Apart from contract
manufacturing, SRIL also manufactures footwear business under its
own brand name 'Red Zone' and 'Front Foot'.
SAVITRIDEVI INDUSTRIES: CARE Keeps D Debt Rating in Not Cooperating
-------------------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Savitridevi
Industries Limited (SIL) continues to remain in the 'Issuer Not
Cooperating' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term bank 9.53 CARE D Issuer not cooperating;
facilities Based on best available
information
Detailed Rationale, Key Rating Drivers and Detailed description of
the key rating drivers
CARE had, vide its press release dated March 18, 2019, placed the
rating of SIL under the 'issuer non-cooperating' category as SIL
had failed to provide information for monitoring of the rating as
agreed to in its Rating Agreement. SIL continues to be
non-cooperative despite repeated requests for submission of
information through email dated June 12, 2020, June 16, 2020, June
23, 2020 and numerous phone calls. 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.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above ratings.
Detailed description of the key rating drivers
At the time of last rating on March 18, 2019, the following were
the rating weaknesses:
Key Rating Weaknesses
* Delay in debt servicing obligations: As per banker interaction
during last review, there were on-going delays in repayment of term
loan and overdrawals in cash credit facility and the account has
been classified as NPA.
SIL was incorporated in October 2009 as Savitridevi Cotton and Oil
Limited. During December 2013, the name of company was changed to
Savitridevi Industries Limited on account of diversified business
division. SIL currently is engaged in ginning and pressing of
cotton, extraction of oil from cotton seed and trading of milk. The
ginning & pressing plant and oil extraction unit is located at
Atpadi, Sangli (Maharashtra) with an installed capacity of 73,000
bales per annum and to extract 2,628 mettic tones of cotton seed
oil per annum.
SHIKHAR MICROFINANCE: CARE Cuts Rating on INR50cr LT Loan to D
--------------------------------------------------------------
CARE Ratings revised the ratings on certain bank facilities of
Shikhar Microfinance Private Limited (SMPL), as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank 50.00 CARE D; ISSUER NOT COOPERATING;
Facilities Revised from CARE BB; Stable;
on the basis of best available
information
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated April 4, 2019, placed the
rating of SMPL under the 'issuer non-cooperating' category as SMPL
had failed to provide information for monitoring of the rating as
agreed to in its Rating Agreement. SMPL continues to be
non-cooperative despite repeated requests for submission of
information through e-mails, phone calls and a email dated June 12,
2020. 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.
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 delay in servicing of
debt obligations by the company as per confirmation received from
the bankers. CARE has not received any information from the
company.
Detailed description of the key rating drivers
At the time of last rating on April 4, 2019, the following were the
rating strengths and weaknesses (updated for the information
available from Registrar of Companies)
Key Rating Weaknesses
* Ongoing delays: There are ongoing delays in servicing of the
scheduled debt obligations by the company.
* Deteriorating capitalization profile: SFPL's capitalization
profile remain moderate with company's capital adequacy remained
adequate as reflected in CAR of 15.50% as on Mar-17 and 23.52% as
on Dec-17. On account of significant losses in FY19, the tangible
net worth of the company reduced from 11.2 crore as on March 31,
2018 to INR7.3 crore as on March 31, 2019. The overall gearing of
the company is at 6.3 times as on March-19.
* Small scale of operations and declining loan book: The
operations of SMPL remain small with a loan portfolio of INR36.5
crore as on March 31, 2019 reduced from loan portfolio of INR70.4
crore as on March 31, 2018.
* Weak financial risk profile: During FY19, the company reported
net loss of INR19.3 crore in FY19 on total income (net of interest
expense) of INR1.3 crore as against net profit of INR0.48 crore on
total income (net of interest expense) of INR6.39 crore in FY18.
The company wrote off loan assets amounting to Rs13 crore in FY19.
Key Rating Strengths
* Experienced promoters with long track record of operations in the
MFI industry: SMPL was promoted by Mr Satyavir Chakrapani and Mr
Vinoy Thomas. Mr Satyavir Chakrapani is the MD & CEO of SMPL having
experience of more than 16 years with the development sector and
microfinance initiatives providing consultations to various
e-governance projects and ICT initiatives in various capacities
like e-governance, developmental and community issues. Mr Vinoy
Thomas (CFO) has over 14 years of experience in serving various
roles that included working with development financial institutions
in the areas of infrastructure consulting, advisory, financial
modeling and analysis.
Shikhar Microfinance Private Limited (SMPL) is a Micro Finance
Institution (MFI) based out of Delhi and founded by Mr Satyavir
Chakrapani and Mr Vinoy Thomas. In 2007, Shikhar Development
Foundation (SDF) was registered as a trust under the Indian Trust
Act, 1882 for its microfinance operations. In 2008, the trustees of
SDF formed a special purpose vehicle namely Partners of Shikhar
Trust (POST). In March 2009, SDF along with Dia Vikas Capital
Private Limited acquired the nonbanking financial company (NBFC),
Anup Leasing Private Limited (ALPL-NBFC, incorporated on February
16, 1993). In October 2010, ALPL was renamed Shikhar Microfinance
Private Limited (SMPL) after obtaining due approvals from RBI.
However, on November 12, 2013, SMPL got converted to NBFC-MFI.
SMPL follows Joint Liability Group (JLG) model wherein it provides
financial assistance to poor women of urban and rural areas. The
company provides small value collateral free loans ranging from
INR15,000 up to INR50,000 for a tenure between 12-36 months. As on
March 31, 2019, SMPL had a total outstanding portfolio of INR36.5
crore.
SKYPOINT MULTITRADE: CARE Keeps D Debt Ratings in Not Cooperating
-----------------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Skypoint
Multitrade Private Limited (SMPL) continues to remain in the
'Issuer Not Cooperating' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term bank 8.48 CARE D Issuer not cooperating;
facilities Based on best available
information
Short-term Bank 10.05 CARE D; Issuer not cooperating;
Facilities Based on best available
Information
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated May 16, 2019, placed the
rating(s) of SMPL under the 'issuer non-cooperating' category as
Sulabh Pharmaceutical Private Limited had failed to provide
information for monitoring of the rating and had not paid the
surveillance fees for the rating exercise as agreed to in its
Rating Agreement. SMPL continues to be non-cooperative despite
repeated requests for submission of information through e-mails,
phone calls and a letter/email dated June 8, 2020. 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.
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 take into account the default in servicing its debt
obligations marked by overdues in the export packing credit
facility coupled with non-servicing of interest in the cash credit
facility.
Detailed description of the key rating drivers
At the time of last rating on February 22, 2017, the following were
the rating strengths and weaknesses
Key Rating Weaknesses
* Default in debt servicing: SMPL has been defaulting in its debt
servicing obligations. The CC facility is irregular with
nonservicing of interest since last 51 days as on February 21,
2017, whereas the EPC facility has remained overdue for more than
180 days. As per banker interaction, the account is classified as
NPA since March 30, 2017.
Incorporated in 2011 by Mr. Masiar Rahaman and Mr. Mijanur Rahaman,
Skypoint Multitrade Private Limited (SMPL, erstwhile Skypoint
Mercantile Private Limited) is engaged in trading of various
agro-commodities like basmati rice, boiled rice, parboiled rice,
raw rice, chana dal, moong dal, soya beans, raw cashew-nuts, yellow
corn, etc. The varieties of rice are sold under the brands "Jolly
Rice" and "Trendy Rice" which comprise 60-65% of the net sales in a
year. SMPL forayed into the exports of rice to the wholesalers in
African and Gulf countries in FY16 with exports constituting ~40%
of the net sales in FY16. All the supplies, on the other hand, are
procured from the domestic agro-producers.
VANI ORGANICS: CARE Lowers Rating on INR6.50cr LT Loan to C
-----------------------------------------------------------
CARE Ratings revised the ratings on certain bank facilities of Vani
Organics Private Limited (VOPL), as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank 6.50 CARE C; ISSUER NOT COOPERATING;
Facilities Revised from CARE B; Stable;
ISSUER NOT COOPERATING; on the
basis of best available
information
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated April 26, 2019, placed the
rating(s) of VOPL under the 'issuer not cooperating' category as
VOPL had failed to provide information for monitoring of the
rating. VOPL continues to be non-cooperative despite repeated
requests for submission of information through phone calls and
e-mails dated June 9, 2020 to June 15, 2020. 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.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating.
The revision in the rating assigned to the bank facilities of Vani
Organics Private Limited (VOPL) take into account operating and net
losses resulting erosion of net worth in FY19 (refers to the period
April 01 to March 31). The rating continues to be tempered by
tempered by small scale of operations, weak financial risk profile
marked by continuous losses, highly competitive and regulated
industry. The rating, however, continues to derive strength from
vast long track record of the company and regular support from
group company in the form of work orders received, extensive
experience of promoters in the industry.
Detailed Rationale& Key Rating Drivers
Updated for the information available from Registrar of Company
Affairs (ROC):
Key Rating Weakness
* Small scale of operations: The scale of operations marked by the
total operating income continues to remain small at INR3.70 crore
in FY19 as compared to INR3.69 crore in FY18.
* Weak financial risk profile marked by continuous losses: VOPL
continues to register operating and net losses of INR1.36 crore and
INR2.31 crore respectively in FY19. Further, the net worth of the
company eroded and stood negative as on March 31, 2019 due to
unabsorbed carry forwarded losses.
* Highly competitive and regulated industry: Indian pharmaceutical
industry is highly fragmented with presence of more than thousands
of players in APIs and formulations. It manufactures about 60,000
generic brands across 60 different therapeutic categories, about
1,500 bulk drugs and almost the entire range of formulations. The
industry is highly fragmented with around 20,000 players, of which,
around 250 in the organized sector primarily in formulations
control over 70% of the total domestic market. All the products and
companies in the pharmaceutical industry are regulated by several
policies and bodies in terms of manufacturing process, patents,
pricing, quality control, safety and health standards, and several
other certifications and control standards. Any policy changes or
regulations by the regulatory bodies may hamper the business of the
companies prevailing in the industry. Increasing regulation,
increased sensitivity towards product performance and pricing
pressure are the key challenges faced by the pharmaceutical
industry.
Key Rating Strengths
* Long track record of the company and regular support from group
company in the form of work orders received: VOPL has a track
record of more than three decades in the field of bulk drugs and
intermediaries manufacturing. The group company; VPL was
incorporated in the year 1976 there by having a track record of
over four decades. VOPL receives support from its flagship company,
VPL, by way of work orders. VPL is the major customer of VOPL.
* Extensive experience of promoters in the industry: Mr.
Mallampatti Chakradhar is the Managing Director and main promoter
of the company. He has gained experience in pharma industry by
working as an employee in Aventis India Limited. He was introduced
as a director into VOPL in the year 1998; he later became the
Managing Director in the year 2005 and looks after the day to day
affairs of the company. Mrs. Mallampati Anuradha is a post graduate
and started her career as the director of VPL during the 1980s. She
currently holds the post of the director and assists Mr. Chakradhar
in managing the daily operations of VOPL. Mrs. Mallampati Lakshmi
Kranthi is the wife of Mr. Chakradha, she is an engineering
graduate and one of the directors in VOPL and handles the human
resource development department of the company.
Vani Organics Private Limited (VOPL) belongs to Vani Group based
out of Hyderabad promoted by Late Mr. Subba Rao. The Group
commenced its business by incorporating Vani Pharma Labs Limited
(VPL) in the year 1976 which is the flagship company of the group
and engaged in manufacturing of Active Pharmaceutical Ingredients
(APIs) and bulk drugs. In 1984, the group expanded its production
facilities by incorporating VOPL in Bidar, Karnataka, to
manufacture bulk drugs.
WHITE HOUSE: CARE Keeps D on INR14cr Loans in Not Cooperating
-------------------------------------------------------------
CARE Ratings said the rating for the bank facilities of White House
Tiles Private Limited (WHTPL) continues to remain in the 'Issuer
Not Cooperating' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term bank 13.30 CARE D Issuer not cooperating;
facilities Based on best available
information
Short-term Bank 0.75 CARE D; Issuer not cooperating;
Facilities Based on best available
Information
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated September 4, 2019, placed
the rating(s) of WHTPL under the 'issuer non-cooperating' category
as WHTPL had failed to provide information for monitoring of the
rating. WHTPL continues to be non-cooperative despite repeated
requests for submission of information through e-mails, phone calls
and a letter/email dated June 12, 2020, June 16, 2020 and June 22,
2020. 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.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating(s).
Detailed description of the key rating drivers
At the time of last rating on September 4, 2019, the following was
the rating weakness:
Key Rating Weaknesses
* On-going delay in debt servicing: Owing to weak liquidity
position, there has been an irregularity in debt servicing.
Morbi (Gujarat) based White House Tiles Private Limited (WHTPL), is
a private limited company established in 2007 by four promoters led
by Mr Vimal Patel and Mr Chunilal Bhanvadia. Mr Vimal Patel and Mr
Chunilal Bhanvadia have 20 years and 30 years of industry
experience, respectively. WHTPL is engaged in the manufacturing of
vitrified floor tiles. WHTPL operates from its manufacturing
facility located in ceramic cluster (Morbi) and has an installed
capacity to manufacture 18 lakh boxes per annum of floor tiles as
on March 31, 2016. WHTPL is selling its product under brand name of
"White House".
[*] INDIA: Plan to Help Small Businesses Does Little to Save Them
-----------------------------------------------------------------
Reuters reports that India re-opened for business in June after
months of lockdown but for thousands of small entrepreneurs in the
town of Meerut, near Delhi, the blow has been devastating.
Businesses from textiles to sports goods and furniture are
shuttered or working at a bare minimum, and cows roam streets that
would be normally packed with workers and vehicles, Reuters says.
Prime Minister Narendra Modi's programme to help small businesses
back on their feet through $40 billion of government-guaranteed
loans is too little and may not be enough to save the many
companies that form the backbone of India's economy, nearly three
dozen entrepreneuers Reuters spoke to across the country said.
Some said their business was so hamstrung by the pandemic that
taking on new debt made little sense. They would rather the
government had helped them by cutting the goods and service tax or
waive off the interest on loans, Reuters relays.
Others said that despite Modi's promise to open up the credit
lines, it was not easy convincing bankers to lend because of the
death throes their businesses were in, Reuters relates.
According to Reuters, Ashok, whose near INR10 million ($133,000)
annual turnover company based in Meerut made steel furniture for
hotels and schools, said he had fired eight of his 10 workers and
was thinking of shutting down the operation.
"It would be better for me to close the unit than to run from
pillar to post to get a loan," said Ashok, who did not want to give
his full name, Reuters relays.
He said his banker told him his creditworthiness is low as his
business is struggling.
The Finance Ministry, which has made the loan support scheme the
centerpiece of the rescue effort, did not respond to a Reuters
request for comment on the problems faced by businessmen.
Small businesses that account for nearly one-quarter of India's
$2.9 trillion economy and employ more than 500 million workers are
the worst affected by the pandemic, Reuters notes.
Nearly 35% of the 650 million small businesses across the country
could shut down soon in the absence of government support, the
Consortium of Indian Associations said in a letter to Modi's office
seen by Reuters.
===============
M A L A Y S I A
===============
BERJAYA MEDIA: To Be Delisted From Bursa on July 17
---------------------------------------------------
Justin Lim at theedgemarkets.com reports that Berjaya Media Bhd
(BMedia) will be delisted from the Main Market of Bursa Malaysia
today, July 17, after Bursa Securities dismissed its appeal for an
extension of time to submit its regularisation plan.
In a bourse filing on July 14, the publisher of The Sun newspaper
said the regulator has decided to delist the company pursuant to
Paragraph 8.04 of Bursa's Main Market Listing Requirements, the
report relates.
"Upon the delisting of the company, the company will continue to
exist but as an unlisted entity. The company is still able to
continue its operations and business and proceed with its corporate
restructuring and its shareholders can still be rewarded by the
company's performance," BMedia said, according to
theedgemarkets.com.
"However, the shareholders will be holding shares which are no
longer quoted and traded on Bursa Securities," it added.
The Practice Note 17 (PN17) company on June 17 requested Bursa
Securities for an extension of time to submit its regularisation
plan, theedgemarkets.com notes.
About Berjaya Media
Berjaya Media Berhad is an investment holding company. The Company,
through its subsidiaries, is engaged in publication, printing and
distribution of daily newspaper. The Company's segments include
investment holding, publishing and others. The Company's
publication, theSun, is read in the market centers of the Klang
Valley, Penang and Johor Bharu, as well as in cities and towns of
Peninsular Malaysia. The Company's publication publishes news on
politics and business, human interest and governance, entertainment
and lifestyle, and sports. theSun also has an online presence at
www.thesundaily.my, where top news of the day is updated and
presented to its readers. The Company offers theSun through
approximately 3,200 sunspots or pick-up points along morning routes
to the workplace, gym, college or breakfast. The Company's
subsidiaries include Sun Media Corporation Sdn. Bhd. And Gemtech
(M) Sdn. Bhd.
Berjaya Media slipped into PN17 (Practice Note 17) status in June
2017 as its shareholders' equity on a consolidated basis fell short
of listing requirements.
Trading of BMedia shares has been suspended since Nov. 5, 2019,
after its failure to enter into a definitive agreement with a white
knight by Oct. 20 that year, theedgemarkets.com says.
KHEE SAN: Triggers PN17 Criteria After Defaulting on Loans
----------------------------------------------------------
Justin Lim at theedgemarkets.com reports that Khee San Bhd has
triggered the prescribed criteria for Practice Note 17 (PN17) under
Bursa Malaysia's Main Market Listing Requirements, after it has
defaulted on its payments to creditors.
However, it will not be classified a PN17 company, in line with the
PN17 relief measures implemented by Bursa from April 17 this year
until June 30, 2021, the candy manufacturer said in an exchange
filing on July 10, the report relays.
There are three criteria of PN17 which have been temporarily
switched off by Bursa during the relief period, including
defaulting in payment by the company and its major subsidiary, or a
major associated company, theedgemarkets.com notes.
Prior to this, Khee San's filing with the local bourse dated July 6
said the group has defaulted on repaying the loans it obtained from
eight banks, which amounted to MYR73.5 million as at March 31.
According to theedgemarkets.com, Khee San said the company had
originally intended to make repayments for the facilities to the
respective creditor banks. However, the funds earmarked for these
repayments were then channelled to its then-holding company, London
Biscuit Bhd (LBB), which had been wound up.
Khee San reported a net loss of MYR76.49 million for the 12 months
ended Dec 31, 2019, on a revenue of MYR129.35 million,
theedgemarkets.com discloses. There were no comparative figures,
following the change in Khee San's financial year end to Dec. 31
from June 30.
Khee San's share price closed two sen or 6.06% lower at 31 sen on
July 10, bringing it a market capitalisation of MYR35.46 million,
theedgemarkets.com discloses. Some 1.58 million were transacted.
Year-to-date, the stock has fallen 26% from when it was trading at
42 sen on Dec. 31.
Khee San Berhad is an investment holding company. The Company,
through its subsidiaries, manufactures sweets and confectionery
products.
===============================
P A P U A N E W G U I N E A
===============================
BANK OF SOUTH PACIFIC: S&P Withdraws 'B-/B' Issuer Credit Ratings
-----------------------------------------------------------------
S&P Global Ratings withdrew its 'B-' long-term and 'B' short-term
issuer and issue credit ratings on Bank of South Pacific Ltd. at
the company's request. At the time of the withdrawal, the outlook
was stable. S&P Global Ratings has also discontinued its Banking
Industry Country Risk Assessment of Papua New Guinea.
=================
S I N G A P O R E
=================
EPICENTRE HOLDINGS: To Sell SGX Listing Status for SGD3 Million
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Sharon See at The Business Times reports that Epicentre Holdings
has agreed to transfer its listing status on the Singapore
Exchange's Catalist board for SGD3 million to an unnamed entity
that will be incorporated in Singapore with the support of South
Korea-listed steel product manufacturer Kossen.
Epicentre, formerly an Apple authorised reseller, is currently
under judicial management, and its shares are suspended from
trading. One of its major intangible assets is its listing status,
its judicial managers said in an exchange filing, BT relays.
According to BT, the company's judicial managers said the company
has entered into an implementation agreement with Kossen and Tardis
Capital, a Singapore-based mergers-and-acquisitions advisory firm.
Tardis was the one that introduced Kossen and the transferee to the
judicial managers.
Upon the transfer, Epicentre's shares will be delisted and
withdrawn from the Catalist board, the report says.
BT relates that the filing said information on the transferee is
currently unavailable, and Epicentre "is given to understand" that
the transferee intends to undergo an internal reorganisation. This
means its financial information, such as its book value and net
tangible asset value, would be available only "in due course", the
filing said.
The transferee's business is in the business of manufacturing,
wholesale and retail of lactobacillus health products, it added.
ET adds that Kossen, key shareholder of BiogenicsKorea, will
procure the incorporation of the transferee and ensure that the
shares of BiogenicsKorea will be wholly-owned by the transferee, it
said.
Epicentre, which opened in 2002, sold all its four storefronts in
June 2018, citing stiff competition as a reason for its poor sales,
BT recalls. At one point in 2011, it had more than 10 stores in
Singapore, Malaysia and China.
In early December 2019, the company's former chief executive
officer and executive chairman Kenneth Lim was reported to be
facing a bankruptcy petition over a debt of SGD588,020, BT notes.
However, he had been uncontactable since late May that year. The
company requested a trading suspension shortly after his
disappearance and fired him in July 2019, BT adds.
About Epicentre Holdings
Epicentre Holdings Limited is an investment holding company. The
Company is an Apple Premium Reseller (APR), which offers a range of
Apple and Apple-related products, as well as pre- and post-sale
services. The Company's segments are Apple brand products, and
third party and proprietary brand complementary products. It also
retails a range of non-Apple branded fashion-skewed accessories in
EpiLife concept stores. EpiLife also carries merchandise under
iWorld, the Company's brand of accessories targeted at the young
and trendy. EpiCentre's e-stores offer a range of accessories,
cases, headphones and styluses from various brands such as,
Monster, JAYS, Belkin, Gosh, Klipsch and B&O. The Company, through
its subsidiary, Epicentre Solutions Pte. Ltd., provides information
technology solutions to educational institutions within Singapore.
It operates approximately five and over six EpiCentre stores in
Singapore and Malaysia (Kuala Lumpur) respectively, and an EpiLife
store in Singapore.
As reported in the Troubled Company Reporter-Asia Pacific on Aug.
5, 2019, The Business Times said interim judicial managers (IJMs)
have been appointed for Epicentre Holdings. On Aug. 2, 2019, after
hearing the IJM application, Justice Kannan Ramesh appointed Ernst
& Young's Ee Meng Yen Angela and Purandar Janampalli Rao as IJMs of
Epicentre "until the making of a judicial management order herein
or until further order", Epicentre said, BT related.
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T H A I L A N D
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THAI AIRWAYS: To Submit Partial Rehabilitation Plan in August
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Bangkok Post reports that Thai Airways International (THAI) will
speed up the drafting of its rehabilitation plan to submit it to
the Central Bankruptcy Court on Aug. 17, when the court is
scheduled to begin examining the airline's rehabilitation request,
acting THAI president Chansin Treenuchagron said.
Bangkok Post relates that the rehabilitation plan currently
consists of short-term, medium-term and long-term measures that Mr
Chansin believes will be successful if the airline's board,
management, creditors and debtors cooperate well.
"The rehabilitation plan still needs some more time before it's
ready [. . .] We will have to submit [what we have] to the court
on Aug 17, so it won't contain all of the details, but it will give
the court a clearer picture of its direction," the report quotes Mr
Chansin as saying.
"Of course, we want to complete it as soon as possible, but it
involves many elements."
THAI has already appointed advisers to help in various areas in the
rehabilitation plan, he said, adding Baker & McKenzie Co was
appointed as legal adviser, EY Corporate Advisory Services Co as an
accounting adviser and Finansa Securities Co as a financial
adviser, according to Bangkok Post.
Bangkok Post says the acting president insisted the airline is
doing its best to deal with cooperatives debenture holders,
aircraft lessors, banks, fuel suppliers and passengers with
cancelled flight tickets.
As part of the draft rehabilitation plan, THAI is deciding on what
to do with assets not worth holding, he said. There is a
possibility that THAI will allow joint ventures with its
non-performing assets, Bangkok Post notes.
About Thai Airways
Thai Airways International PCL (BAK:THAI) --
http://www.thaiairways.co.th/-- is the national carrier of
Thailand. The company provides air transportation, freight and
mail services on domestic and international routes including Asia,
Europe, North America, Africa and South West Pacific. The Company
is a state enterprise which is controlled by the government and
partly owned by the public.
As reported in Troubled Company Reporter-Asia Pacific on May 21,
2020, Reuters said Thailand's cabinet approved a plan to
restructure troubled Thai Airways International Pcl's finances
through a bankruptcy court, the Southeast Asian country's prime
minister said on May 19. The plan for a court-led restructuring of
the national carrier replaces a previous proposal of a
government-backed rescue package that was heavily criticised in the
country.
Thai Airways on May 27 said it appointed board members as
rehabilitation planners in a bankruptcy court submission.
Thai Airways posted losses every year after 2012, except in 2016.
In 2019, it reported losses of THB12.04 billion.
*********
S U B S C R I P T I O N I N F O R M A T I O N
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Copyright 2020. All rights reserved. ISSN: 1520-9482.
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