/raid1/www/Hosts/bankrupt/TCRAP_Public/201019.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
A S I A P A C I F I C
Monday, October 19, 2020, Vol. 23, No. 209
Headlines
A U S T R A L I A
A ONE AUDIO: Second Creditors' Meeting Set for Oct. 26
ALLIED CREDIT 2020-1: Moody's Assigns (P)B2 Rating on Cl. F Notes
AMS HOLDINGS: Second Creditors' Meeting Set for Oct. 26
JABIRU SPORTS: Second Creditors' Meeting Set for Oct. 26
METRO FINANCE 2019-1: Moody's Upgrades Class F Notes to Ba3(sf)
MINISO MASTER: Up to 100 Jobs Saved as Creditors Accept DOCA
MONALENIC PTY: Second Creditors' Meeting Set for Oct. 26
THINK TANK 2020-1: S&P Assigns B (sf) Rating on Class F Notes
C H I N A
SHANGRAO INNOVATION: Fitch Assigns BB LT IDR, Outlook Stable
H O N G K O N G
[*] HONG KONG: Bankruptcy Orders Surge to 778 in September
I N D I A
A. F. CASHEWS: CRISIL Keeps B Debt Ratings in Not Cooperating
AUM SHRI: CRISIL Keeps B+ Debt Rating in Not Cooperating Category
AZAD EDUCATIONAL: CARE Keeps C Debt Rating in Not Cooperating
B. RAMANAIAH: CRISIL Lowers Rating on INR14cr Overdraft to B
BHADOHI CARPETS: CRISIL Keeps B+ Debt Ratings in Not Cooperating
BNK ENERGY: CARE Lowers Rating on INR2.0cr LT Loan to C
BRIJLAX MOTORS: CRISIL Lowers Rating on INR12.5cr Loans to B
BULAND CONSTRUCTION: CARE Keeps D Debt Ratings in Not Cooperating
CAPITAL PROPMART: CRISIL Keeps B+ Debt Rating in Not Cooperating
CASTWEL INDUSTRIES: CRISIL Lowers Rating on INR5cr Loan to B
DEEPAK YADAV: CRISIL Keeps B Debt Rating in Not Cooperating
DELTA CROP: CRISIL Keeps B+ Debt Ratings in Not Cooperating
ELWOOD PARK: Second Creditors' Meeting Set for Oct. 26
EXCEL METAL: CARE Keeps D Debt Ratings in Not Cooperating Category
HERO FINCORP: Moody's Assigns Ba1 CFR, Outlook Negative
K. T. RAVI: CARE Lowers Rating on INR7cr LT Loan to C
KARPADHA AGRO: CARE Keeps D Debt Ratings in Not Cooperating
MAHAA LAKSHMI: CRISIL Keeps B- Debt Ratings in Not Cooperating
MANGALORE MARKETING: CRISIL Keeps B+ Rating in Not Cooperating
PRASHANT CASTECH: CRISIL Lowers Rating on INR1cr Cash Loan to B
RAJRANI COLD: CARE Keeps D Debt Rating in Not Cooperating Category
RELIANCE COMM: Court Seeks Chinese Banks' View on Ambani's Plea
RENEW POWER: Fitch Assigns BB-(EXP) Rating on New Sec. Notes
ROLTAS PAPER: CRISIL Assigns B+ Rating to INR12cr Fund Based Loan
SAI RAMA: CRISIL Downgrades Rating on INR10cr Loans to B
SEA BLUE: CARE Keeps D Debt Ratings in Not Cooperating Category
SHIVHARE ROAD: CRISIL Keeps B+ Debt Ratings in Not Cooperating
SPRING DYNAMICS: CRISIL Keeps B Debt Ratings in Not Cooperating
SUBRA INTERNATIONAL: CRISIL Cuts Rating on INR24cr Loan to B
SUMANGAL POLYMERS: CRISIL Lowers Rating on INR15cr Loan to B
I N D O N E S I A
MODERNLAND REALTY: S&P Downgrades Issuer Credit Rating to 'D'
M A L A Y S I A
AIRASIA GROUP: Unit to Liquidate Indonesia Operations Amid Woes
MALAYSIA AIRLINES: Restructuring Talks Prolonged, CEO Tells Staff
S I N G A P O R E
KRISENERGY: Court to Hear Bid to Convene Scheme Meeting on Oct. 30
NEW SILKROUTES: Goh Jin Hian Steps Down as Chairman
- - - - -
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A U S T R A L I A
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A ONE AUDIO: Second Creditors' Meeting Set for Oct. 26
------------------------------------------------------
A second meeting of creditors in the proceedings of A One Audio Pty
Ltd has been set for Oct. 26, 2020, at 2:00 p.m. at Mezzanine
Level, 28 The Esplanade, in Perth, WA.
The purpose of the meeting is (1) to receive the report by the
Administrator about the business, property, affairs and financial
circumstances of the Company; and (2) for the creditors of the
Company to resolve whether the Company will execute a deed of
company arrangement, the administration should end, or the Company
be wound up.
Creditors wishing to attend are advised proofs and proxies should
be submitted to the Administrator by Oct. 25, 2020, at 4:00 p.m.
Jeremy Joseph Nipps of Cor Cordis was appointed as administrator of
A One Audio on Sept. 21, 2020.
ALLIED CREDIT 2020-1: Moody's Assigns (P)B2 Rating on Cl. F Notes
-----------------------------------------------------------------
Moody's Investors Service has assigned the following provisional
ratings to the notes to be issued by AMAL Trustees Pty Ltd as
trustee of Allied Credit ABS Trust 2020-1.
Issuer: Allied Credit ABS Trust 2020-1
AUD149.0 million Class A Notes, Assigned (P)Aaa (sf)
AUD16.0 million Class B Notes, Assigned (P)Aa2 (sf)
AUD9.6 million Class C Notes, Assigned (P)A2 (sf)
AUD7.0 million Class D Notes, Assigned (P)Baa2 (sf)
AUD7.8 million Class E Notes, Assigned (P)Ba2 (sf)
AUD3.0 million Class F Notes, Assigned (P)B2 (sf)
AUD7.6 million Equity G Notes are not rated by Moody's
Allied Credit ABS Trust 2020-1 is the first term securitisation of
loans backed by motorcycle, marine and other assets by Allied
Credit Pty Ltd (Allied Credit, unrated). This is also the first
term securitisation backed by motorcycle and marine receivables in
Australia.
The securitised loans are mainly consumer, and backed by
motorcycles (71.4%), marine assets (15.2%), auto (10.0%) and other
recreational vehicles (3.5%). The loans were originated by entities
either 100% owned by Allied Credit or 50% owned by Allied Credit
together with a joint venture partner. All receivables were
underwritten by Allied Credit. The receivables are serviced by
Allied Retail Finance Pty Ltd (ARF, unrated), a wholly owned
subsidiary of Allied Credit.
Allied Credit, a privately owned company, was established in 2010
with a primary focus on financing of motorcycle and marine consumer
loans. In 2019, Allied expanded into financing of auto loans.
Allied Credit's total loan book was around AUD430 million as at
August 31, 2020.
RATINGS RATIONALE
The provisional ratings take into account, among other factors,
evaluation of the underlying receivables and their expected
performance, evaluation of the capital structure and credit
enhancement provided to the notes, availability of excess spread
over the life of the transaction, the liquidity facility in the
amount of 3.00% of the rated notes balance, the legal structure,
and the experience of Allied Credit as servicer.
Moody's PCE — representing the loss that Moody's expects the
portfolio to suffer in the event of a severe recession scenario —
is 27.5%. Moody's mean default for this transaction is 5.2%.
The coronavirus outbreak, the government measures put in place to
contain it, and the weak global economic outlook continue to
disrupt economies and credit markets across sectors and regions.
Its analysis has considered the effect on the performance of
consumer assets from the current weak Australian economic activity
and a gradual recovery for the coming months. Although an economic
recovery is underway, it is tenuous and its continuation will be
closely tied to containment of the virus. As a result, the degree
of uncertainty around its forecasts is unusually high. Moody's
regards the coronavirus outbreak as a social risk under its ESG
framework, given the substantial implications for public health and
safety.
Key transactional features are as follows:
- Once step-down conditions are satisfied, all notes, excluding
class G notes, will receive their pro-rata share of principal. Step
down conditions include, among others, 35% subordination to the
Class A notes and no unreimbursed charge-offs.
- A swap provided by National Australia Bank Limited
(Aa3/P-1/Aa2(cr)/P-1(cr)) will hedge the interest rate mismatch
between the assets bearing a fixed rate of interest, and floating
rate liabilities. The notional balance of the swap will follow a
schedule based on amortisation of the rated notes assuming certain
prepayments.
- AMAL Asset management Limited is the back-up servicer. If ARF
is terminated as servicer, AMAL will take over the servicing role
in accordance with the standby servicing deed and its back-up
servicing plan.
Key pool features are as follows:
- Interest rates in the portfolio range from 0.00% to 21.95%,
with a weighted average interest rate of 10.2%.
- The weighted average seasoning of the portfolio is 13.6 months,
while the weighted average remaining term of the portfolio is 47.5
months.
- The portfolio is well diversified geographically relative to
state population distribution in Australia, with only some excess
concentration in the state of Queensland.
The principal methodology used in these ratings was "Moody's Global
Approach to Rating Auto Loan- and Lease-Backed ABS" published in
July 2020.
Factors That Would Lead to an Upgrade or Downgrade of the Ratings:
Up
Levels of credit protection that are greater than necessary to
protect investors against current expectations of loss could lead
to an upgrade of the ratings. Moody's current expectations of loss
could be better than its original expectations because of fewer
defaults by underlying obligors. The Australian job market is a
primary driver of performance.
Down
Levels of credit protection that are insufficient to protect
investors against current expectations of loss could lead to a
downgrade of the ratings. Moody's current expectations of loss
could be worse than its original expectations because of more
defaults by underlying obligors. The Australian job market is a
primary driver of performance. Other reasons for worse performance
than Moody's expects include poor servicing, error on the part of
transaction parties, a deterioration in credit quality of
transaction counterparties, lack of transactional governance and
fraud.
AMS HOLDINGS: Second Creditors' Meeting Set for Oct. 26
-------------------------------------------------------
A second meeting of creditors in the proceedings of AMS Holdings
(WA) Pty Ltd has been set for Oct. 26, 2020, at 11:00 a.m. at
Duxton Hotel Perth, 1 St Georges Terrace, in Perth, WA.
The purpose of the meeting is (1) to receive the report by the
Administrator about the business, property, affairs and financial
circumstances of the Company; and (2) for the creditors of the
Company to resolve whether the Company will execute a deed of
company arrangement, the administration should end, or the Company
be wound up.
Creditors wishing to attend are advised proofs and proxies should
be submitted to the Administrator by Oct. 23, 2020, at 5:00 p.m.
Cameron Shaw, Richard Albarran and Marcus Watters of Hall Chadwick
were appointed as administrators of AMS Holdings on Sept. 24, 2020.
JABIRU SPORTS: Second Creditors' Meeting Set for Oct. 26
--------------------------------------------------------
A second meeting of creditors in the proceedings of Jabiru Sports &
Social Club Inc has been set for Oct. 26, 2020, at 11:00 a.m. at
the offices of Rodgers Reidy, Unit 13, 16 Charlton Court, in
Woolner, NT.
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 Oct. 23, 2020, at 5:00 p.m.
S G Reid of Rodgers Reidy was appointed as administrator of Jabiru
Sports on Sept. 21, 2020.
METRO FINANCE 2019-1: Moody's Upgrades Class F Notes to Ba3(sf)
---------------------------------------------------------------
Moody's Investors Service has upgraded the ratings for five classes
of notes issued by Metro Finance 2019-1 Trust.
The affected ratings are as follows:
Issuer: Metro Finance 2019-1 Trust
Class B Notes, Upgraded to Aa1 (sf); previously on Jul 11, 2019
Definitive Rating Assigned Aa2 (sf)
Class C Notes, Upgraded to A1 (sf); previously on Jul 11, 2019
Definitive Rating Assigned A2 (sf)
Class D Notes, Upgraded to A3 (sf); previously on Jul 11, 2019
Definitive Rating Assigned Baa2 (sf)
Class E Notes, Upgraded to Baa3 (sf); previously on Jul 11, 2019
Definitive Rating Assigned Ba1 (sf)
Class F Notes, Upgraded to Ba3 (sf); previously on Jul 11, 2019
Definitive Rating Assigned B1 (sf)
RATINGS RATIONALE
The upgrades were prompted by the increase in credit enhancement
available for the affected notes. In addition, the loan portfolio
has been performing within Moody's expectation even after
incorporating the potential impact from COVID-19 disruptions.
Following the September 2020 payment date, the credit enhancement
available for the Class B, Class C, Class D, Class E and Class F
Notes increased to 17.8%, 12.6%, 9.6%, 5.2% and 3.6% respectively
from 12.0%, 8.5%, 6.5%, 3.5% and 2.4% at closing.
As of August 2020, 0.8% of the outstanding pool was 30-plus day
delinquent, and 0.25% was 90-plus day delinquent. However, these
numbers may be understated, because loans that are under
COVID-19-related hardship assistance are classified as current. As
of the end of August 2020, 5.0% of the portfolio was under such
assistance. The portfolio has incurred 0.1% (as a percentage of the
original pool balance) of losses to date, all of which have been
covered by excess spread.
Based on the observed performance to date, COVID-19-related
hardship assistance and considering the ongoing economic
disruptions, Moody's has increased its default assumption to 3.7%
of the outstanding pool balance from 3.25%. Moody's has also
lowered the Aaa portfolio credit enhancement to 20% from 22%.
Moody's analysis has also considered various stressed scenarios of
higher mean default rates and backloading of losses to evaluate the
resiliency of the note ratings.
The coronavirus outbreak, the government measures put in place to
contain it, and the weak global economic outlook continue to
disrupt economies and credit markets across sectors and regions.
Moody's analysis has considered the effect on the performance of
commercial auto loans from the current weak Australian economic
activity and a gradual recovery over coming months. Although an
economic recovery is underway, it is tenuous and its continuation
will be closely tied to containment of the virus. As a result, the
degree of uncertainty around Moody's forecasts is unusually high.
Moody's regards coronavirus as a social risk under its environment,
social and governance (ESG) framework, given the substantial
implications for public health and safety.
Metro Finance 2019-1 Trust is a cash securitisation of auto loans
and leases originated by Metro Finance Pty Limited and extended to
prime commercial obligors located in Australia.
The transaction is supported by a liquidity facility in the amount
of 2.0% of the notes balance, which can cover approximately six
months of interest payments.
The principal methodology used in these ratings was Moody's Global
Approach to Rating Auto Loan- and Lease-Backed ABS published in
July 2020.
Factors that would lead to an upgrade or downgrade of the ratings:
Factors that could lead to an upgrade of the ratings include (1)
performance of the underlying collateral that is better than
Moody's expectations, and (2) an increase in the notes' available
credit enhancement.
Factors that could lead to a downgrade of the ratings include (1)
performance of the underlying collateral that is worse than Moody's
expectations, (2) a decrease in the notes' available credit
enhancement, and (3) a deterioration in the credit quality of the
transaction counterparties.
MINISO MASTER: Up to 100 Jobs Saved as Creditors Accept DOCA
------------------------------------------------------------
Inside Retail reports that creditors of Miniso's Australian
business have overwhelmingly voted in favor of a proposed Deed of
Company Arrangement, which will see 30 of its 32 stores across
Australia remain open and up to 100 staff keep their job.
While creditors claims topped AUD18 million, this amount would have
ballooned to AUD49 million had the business collapsed due to the
impact of lease terminations, Inside Retail relates.
"It's a great outcome, and it shows that a voluntary administration
done the right way can provide a platform for a business like
Miniso to reset and trade profitability off the back of Covid-19
trading conditions," the report quotes administrator Philip
Campbell-Wilson as saying.
"It needed the support of franchisees, employers and commercial
landlords alike, which was greatly appreciated throughout the
process."
As part of the restructure, administrators made deals with
landlords such as Scentre Group and Vicinity Centres to achieve
better leases moving forward, while also closing two unprofitable
stores in Southland, Victoria and Merrylands, NSW, as well as its
head offices in Sydney and Melbourne, according to Inside Retail.
The business will be run remotely from its headquarters in China
until business conditions improve.
Inside Retail relates that Miniso director Wing Kin Yip said the
restructure has enabled them to retain the majority of their
stores, and now has plans to open a further 15 stores by the end of
2021.
As reported in the Troubled Company Reporter-Asia Pacific on July
20, 2020, the Australian master franchisee for multinational
discount retailer Miniso has collapsed into voluntary
administration after the COVID-19 pandemic saw sales tank.
Miniso Master Franchisee Pty Ltd, the main revenue generating
entity associated with Miniso's business in Australia, has
appointed administrators from Grant Thornton, owing an estimated
AUD14.6 million to creditors, according to SmartCompany.
Philip Campbell-Wilson and Said Jahani of Grant Thornton Australia
Limited were appointed as administrators of Miniso Master on July
13, 2020.
Miniso has 31 trading stores in Australia. However, about a dozen
franchises, and eight other stores owned under various joint
venture arrangements, are not in administration, SmartCompany
noted.
MONALENIC PTY: Second Creditors' Meeting Set for Oct. 26
--------------------------------------------------------
A second meeting of creditors in the proceedings of Monalenic Pty
Ltd has been set for Oct. 26, 2020, at 2:00 p.m. at Mezzanine
Level, 28 The Esplanade, in Perth WA.
The purpose of the meeting is (1) to receive the report by the
Administrator about the business, property, affairs and financial
circumstances of the Company; and (2) for the creditors of the
Company to resolve whether the Company will execute a deed of
company arrangement, the administration should end, or the Company
be wound up.
Creditors wishing to attend are advised proofs and proxies should
be submitted to the Administrator by Oct. 26, 2020, at 2:00 p.m.
Jeremy Joseph Nipps of Cor Cordis was appointed as administrator of
Monalenic Pty on Sept. 21, 2020.
THINK TANK 2020-1: S&P Assigns B (sf) Rating on Class F Notes
-------------------------------------------------------------
S&P Global Ratings assigned its ratings to seven of the nine
classes of small-ticket commercial mortgage-backed, floating rate,
pass-through notes issued by BNY Trust Co. of Australia Ltd. as
trustee of Think Tank Series 2020-1 Trust.
Think Tank Series 2020-1 Trust is a securitization of loans to
commercial borrowers, secured by first-registered mortgages over
Australian commercial or residential properties originated by Think
Tank Group Pty Ltd. (Think Tank).
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 that the credit support is sufficient to withstand
the stresses it applies. This credit support comprises note
subordination for each class of rated note.
-- That the transaction's cash flows can meet timely payment of
interest and ultimate payment of principal to the noteholders under
the rating stresses. Key factors are the level of subordination
provided, the condition that a minimum margin will be maintained on
the assets, an amortizing liquidity facility sized at 3.0% of the
outstanding balance of the rated notes, and the principal draw
function.
-- The extraordinary expense reserve of A$250,000, funded from day
one by Think Tank, available to meet extraordinary expenses.
-- The reserve will be topped up via excess spread if drawn.
-- The legal structure of the trust, which has been established as
a special-purpose entity and meets our criteria for insolvency
remoteness.
-- That loss of income for borrowers in the coming months due to
the effects of COVID-19 will likely put upward pressure on mortgage
arrears. S&P said, "In our credit analysis, we have assessed those
loans in the portfolio where the borrower has applied for a
COVID-19 hardship payment arrangement. We have increased the
minimum credit support levels to reflect the likelihood that
arrears increase following the end of the hardship arrangement
period. In our cash-flow analysis, we have assumed a portion of
principal and interest collections are delayed to stress test the
liquidity provided to the transaction." As of Oct. 9, 2020,
borrowers with COVID-19-related hardship arrangements make up 11.6%
of the pool balance.
S&P Global Ratings acknowledges a high degree of uncertainty about
the evolution of the coronavirus pandemic. The current consensus
among health experts is that COVID-19 will remain a threat until a
vaccine or effective treatment becomes widely available, which
could be around mid-2021. S&P said, "We are using this assumption
in assessing the economic and credit implications associated with
the pandemic. As the situation evolves, we will update our
assumptions and estimates accordingly."
RATINGS ASSIGNED
Think Tank Series 2020-1 Trust
Class Rating Amount (mil. A$)
A1 AAA (sf) 360.00
A2 AAA (sf) 110.40
B AA (sf) 36.00
C A (sf) 32.40
D BBB (sf) 28.20
E BB (sf) 13.20
F B (sf) 9.60
G NR 4.20
H NR 6.00
NR--Not rated.
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C H I N A
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SHANGRAO INNOVATION: Fitch Assigns BB LT IDR, Outlook Stable
------------------------------------------------------------
Fitch Ratings has assigned Shangrao Innovation Development Industry
Investment Group Co., Ltd. (SIIG) first-time Long-Term Foreign- and
Local-Currency Issuer Default Ratings (IDR) of 'BB'. The Outlook is
Stable.
SIIG was established in 2015 and is one of the largest
government-related entities in Shangrao municipality, Jiangxi
province. It is mainly engaged in infrastructure construction,
carrying out industrial investment on behalf of the Shangrao
municipality, supplying water and providing sewage treatment.
KEY RATING DRIVERS
'Very Strong' Status, Ownership, and Control: SIIG is a limited
liability company wholly owned, controlled and supervised by the
Shangrao municipality via the Shangrao State-owned Assets
Supervision and Administration Commission, which owns a 55% stake,
and the Shangrao Economic and Technical Development Zone (ETDZ)
Management Committee, with the remaining 45%. Shangrao
municipality's approval is required for senior management
appointments, and major investment and financing activities.
'Strong' Support Record and Expectations: SIIG receives regular
contracted payments from the Shangrao ETDZ Administrative Committee
for its commissioned urban-development projects. It uses a
cost-plus business model with margins of 6%-18%. Transfers and
grants accounted for 18% of total revenue on average in the past
four years. Cash capital injections from the public sector in
2017-2019 amounted to CNY2.6 billion on average, which accounted
for around 12% of its net asset increase. SIIG also received
interest subsidies of CNY264 million and CNY118 million in 2018 and
2019, respectively, for the financing provided to local industrial
enterprises as the municipality's main agent in developing the
city's industries. It also has sole franchise rights to supply
water and treat sewage in the Shangrao ETDZ with support such as
operating subsidies and taxation benefits.
'Moderate' Socio-Political Implications of Default: SIIG relies on
access to debt funding to continue its projects, especially those
that can cause social problems if delayed, including resettlement
housing. However, it has a diverse project portfolio and if a
default occurs, the municipality may use administrative and fiscal
measures to ensure operations are not disrupted on a long-term
basis.
'Strong' Financial Implications of Default: SIIG raises debt to
finance policy-driven construction and investment, and relies on
regular contracted revenue and equity injections from the public
sector to service its debt. SIIG is one of the largest
policy-driven entities under the Shangrao municipality and its
total debt accounts for a significant proportion of the
municipality's overall risk. Other government-related entities in
Shangrao have provided entrusted loans or financial guarantees to
SIIG. A default by SIIG would have a major impact on local
financing costs.
Standalone Credit Profile 'b': Fitch has assessed SIIG's revenue
defensibility as 'Midrange'. Its urban-development and utility
businesses have a diversified project or user portfolio although
they are mainly concentrated in the Shangrao ETDZ. The industrial
investment business mainly focuses on Shangrao's flagship
industrial enterprises, including automobile and photovoltaic
industries. Cost-pass-through mechanisms are in place to smooth
over price volatility. Fitch assesses the operating risk at
'Midrange' based on its relatively predictable cost structure and
long investment horizon. Fitch assesses its financial profile at
'Weaker' due to high leverage from heavy capex.
DERIVATION SUMMARY
Fitch assessed SIIG under its Government-Related Entities Rating
Criteria, reflecting Shangrao municipality's ultimate ownership and
oversight over SIIG, a record of financial support and the
company's functional role in Shangrao's development, a key
strategic initiative of the government. These factors indicate a
strong incentive by the sponsor to provide extraordinary support to
SIIG, if needed.
SIIG's IDR was derived from the four factors under Fitch's
Government-Related Entities Rating Criteria and the Standalone
Credit Profile of 'b' from its Public Sector, Revenue-Supported
Entities Rating Criteria.
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
- Upward revision in Fitch's credit view of the Shangrao
municipality's ability to provide subsidies, grants or other
legitimate resources allowed under China's policies and
regulations.
- An increase in Shangrao's incentive to support SIIG, including
stronger socio-political and financial implications of a default or
a stronger support record and expectation.
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
- Downward revision in Fitch's credit view of the Shangrao
municipality's ability to provide subsidies, grants or other
legitimate resources allowed under China's policies and
regulations
- Significant weakening in the socio-political and financial
implications of a default by SIIG, a weaker government support
record and expectation or a dilution in the government's
shareholding.
ESG CONSIDERATIONGS
The highest level of ESG credit relevance, if present, is a score
of 3. This means ESG issues are credit-neutral or have only a
minimal credit impact on the entity(ies), either due to their
nature or to the way in which they are being managed by the
entity(ies).
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H O N G K O N G
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[*] HONG KONG: Bankruptcy Orders Surge to 778 in September
----------------------------------------------------------
The Standard reports that the bankruptcy orders and winding-up
orders in September recorded a new high for more than four years,
data from Official Receiver's Office showed.
Receiving and bankruptcy orders surged by 50% month-on-month to 778
or up 32% year-on-year to 778 last month, The Standard discloses.
The report says compulsory winding-up orders amounted to 44, rising
by 83% from a previous month and 190% compared with the same period
last year.
Bankruptcy petitions dropped by 0.7% month-on-month but increased
by 4% to 716.
For the first nine months, the bankruptcy petitions amounted to
6,656, up by 12% from a year ago, the report adds.
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I N D I A
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A. F. CASHEWS: CRISIL Keeps B Debt Ratings in Not Cooperating
-------------------------------------------------------------
CRISIL said the ratings on bank facilities of A. F. Cashews (AFC)
continue to be 'CRISIL B/Stable/CRISIL A4 Issuer not cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 3 CRISIL B/Stable (ISSUER NOT
COOPERATING)
Packing Credit 1.5 CRISIL A4 (ISSUER NOT
COOPERATING)
Proposed Long Term 5 CRISIL B/Stable (ISSUER NOT
Bank Loan Facility COOPERATING)
Term Loan 0.5 CRISIL B/Stable (ISSUER NOT
COOPERATING)
CRISIL has been consistently following up with AFC for obtaining
information through letters and emails dated March 17, 2020 and
September 16, 2020 among others, apart from telephonic
communication. However, the issuer has remained non cooperative.
'The investors, lenders and all other market participants should
exercise due caution with reference to the rating assigned/reviewed
with the suffix 'ISSUER NOT COOPERATING' as the rating is arrived
at without any management interaction and is based on best
available or limited or dated information on the company. Such non
co-operation by a rated entity may be a result of deterioration in
its credit risk profile. These ratings with 'ISSUER NOT
COOPERATING' suffix lack a forward looking component.'
Detailed Rationale
Despite repeated attempts to engage with the management, CRISIL
failed to receive any information on either the financial
performance or strategic intent of AFC, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes that rating action on AFC is consistent
with 'Assessing Information Adequacy Risk'. Based on the last
available information, the ratings on bank facilities of AFC
continues to be 'CRISIL B/Stable/CRISIL A4 Issuer not
cooperating'.
AFC was established in 2012 by Mr. Shihab S along with his wife as
a partnership concern, to process and trade in cashew kernels. He
was later joined by his friend Mr. Nizamudeen I as partner, while
his wife retired. Currently, the firm is managed by the two
partners.
AUM SHRI: CRISIL Keeps B+ Debt Rating in Not Cooperating Category
-----------------------------------------------------------------
CRISIL said the rating on bank facilities of Aum Shri Hotels and
Resorts Private Limited (Aum) continues to be 'CRISIL
B+/Stable/CRISIL A4 Issuer not cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Bank Guarantee 17.31 CRISIL A4 (ISSUER NOT
COOPERATING)
Proposed Long Term .69 CRISIL B+/Stable (ISSUER NOT
Bank Loan Facility COOPERATING)
CRISIL has been consistently following up with Aum for obtaining
information through letters and emails dated March 17,2020 and
September 16,2020 among others, apart from telephonic
communication. However, the issuer has remained non cooperative.
'The investors, lenders and all other market participants should
exercise due caution with reference to the rating assigned/reviewed
with the suffix 'ISSUER NOT COOPERATING' as the rating is arrived
at without any management interaction and is based on best
available or limited or dated information on the company. Such non
co-operation by a rated entity may be a result of deterioration in
its credit risk profile. These ratings with 'ISSUER NOT
COOPERATING' suffix lack a forward looking component.'
Detailed Rationale
Despite repeated attempts to engage with the management, CRISIL
failed to receive any information on either the financial
performance or strategic intent of Aum, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes that rating action on Aum is consistent
with 'Assessing Information Adequacy Risk'. Based on the last
available information, the ratings on bank facilities of Aum
continues to be 'CRISIL B+/Stable/CRISIL A4 Issuer not
cooperating'.
Aum is a closely held private limited company, promoted by Mr.
Arvind Preet Singh and Mr. Anil Thakran. The company was
incorporated in July 2012 and has entered into a joint development
agreement with Three C Properties Pvt. Ltd. (TCPL) for development
of residential township in Gurgaon. Aum owns the land and is
entitled to 44 per cent of the saleable proceeds from the project,
while the joint development partner - TCPL, who undertake
development of the project, is entitled to remainder of the sale
proceeds.
AZAD EDUCATIONAL: CARE Keeps C Debt Rating in Not Cooperating
-------------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Azad
Educational Society (AES) continues to remain in the 'Issuer Not
Cooperating' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Bank 14.30 CARE C; Issuer not cooperating;
Facilities Based on best available
information
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated August 7, 2019 placed the
ratings of AES under the 'issuer non-cooperating' category as Azad
Educational Society had failed to provide information for
monitoring of the rating. Azad Educational Society continues to be
non-cooperative despite repeated requests for submission of
information through e-mails, phone calls and a letter/email dated
September 21, 2020, September 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. Further banker could not be
contacted.
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 August 7, 2019 the following were the
rating weaknesses and strengths:
Detailed description of the key rating drivers
Key Rating Weaknesses
* Small scale of operations: The scale of operations of the society
has remained small for the past three financial years i.e.
FY15-FY17. The total operating income and gross cash accruals stood
at INR19.17crore and INR 3.44 crore for FY17 (FY refers to the
period April 1 to March 31). Further, the society's net worth base
was relatively small at INR 12.91 crore as on March 31, 2017. The
small scale limits the society's financial flexibility in times of
stress and deprives it of scale benefits.
* Low enrolment ratio: Through its five colleges, AES offers
education in a wide range of courses namely B.Tech, M.Tech., BCA,
BBA, MCA, diploma, etc. Except few courses, enrolment ratio has
been weak across majority of the courses including engineering and
management courses. Low enrolment is also reflected in consistent
decline in scale of operations. CARE will not comment on the
enrolment ratio due to non-submission of latest information by the
society.
* Low profitability margins and leveraged capital structure: The
society has moderate profitability margins marked by SBID margin
and surplus margin for the past three financial years i.e.
FY15-FY17. SBID margins stood at 33.10% in FY17 as against 30.26%
in FY16 mainly on account of decline in expenses. Further, surplus
margin stood low at 3.54% in FY17 on account of high interest and
depreciation expenses. The capital structure of the society
comprised of term loan, unsecured loans from related parties and
working capital bank borrowings amounting to INR3.09 crore, INR3.15
crore and INR23.17 crore respectively as on March 31, 2017 as
against corpus fund of INR12.91 crore. The capital structure of the
society as marked by debt equity and overall gearing ratio stood
leveraged as on past three balance sheet dates (FY15-FY17) due to
high dependence on external borrowings to meet the working capital
requirements. Debt equity and overall gearing ratio stood at 2.28x
and 0.24x respectively as on March 31, 2017. In addition to AICTE,
the educational institutes are regulated by respective State
Governments with respect to the number of management seats, amount
of the tuition fees charged for the Government quota (10% fee hike
per annum allowed) and management quota. The factors have a
significant impact on the revenue and profitability of the
institution. The state and central Government have provided thrust
to demand for engineering colleges by introducing policy changes
like abolition of entrance exams for admission in professional
course. The education industry remains highly regulated industry
with constant intervention from the central state government and
other regulatory bodies.
* Intense competition from established and upcoming educational
institutes: AES operates through its four colleges in Uttar Pradesh
(UP). The society faces intense competition in UP in the management
and engineering courses from well-established and reputed
institutes like Institute of Management Studies, Ghaziabad, Ajay
Kumar Garg Engineering College, HRIT Group of Institutions, Raj
Kumar Goel Institute of Technology, etc. Operations concentrated
primarily to a single geographical area AES caters mainly to the
Lucknow area with four colleges situated at the same campus which
limits the reach penetration level for the society to tap
opportunities. Further, due to increasing focus on technical
education in India, a number of colleges have been opened up in
close proximity. This exposes the revenue of AES to competition
from other colleges. However, over the years new courses have been
added and there has been a consistent growing base of students
which has steadily increased the scale of operation though within
the same geographical region.
Key Rating Strengths
* Experienced members of the society: Azad educational Society is
being managed by Mr. Suhail Ahmad and Mr. Abdullah Ahmad. Mr.
Suhail Ahmad is a post graduate by qualification and has an
experience of more than two decades in the education industry
through his association with this society. Mr. Abdullah Ahmad is a
graduate by qualification and has an experience of 3 years through
his association as the Secretary of the society.
* Diverse course offerings: The society runs the institute under
which it manages various different colleges. Various different
fields being covered by the trust diversifies the revenue sources
resulting in different stream of revenue generation along with less
vulnerability to changes proposed in the course structure by AES.
Thus, the revenue of AES is not concentrated to a single college or
course thereby reducing dependency on a particular course or
college.
* Well established infrastructure: The society has its campus
situated on the outer periphery of Lucknow, is well connected to
NCR through NH-24. The campus environment and facilities are
conductive to professional studies with ample facilities such as
sports, transportation facility, state-of-the-arts laboratories,
modern classrooms, computer centres including conference halls,
auditoriums, video conferencing, medical facilities, multi-media
projectors, well stocked libraries, classrooms etc.
* Buoyant prospects of higher/professional education of sectors:
AES is primarily engaged in providing higher education which
comprises of graduation and post-graduation courses, demand of
these courses are growing at a phenomenal pace in India targeting
approximately 12.7% of Indian population in the age group of 18-24
years of age. The increase in government spending on education over
the years has provided an impetus to the growth of Higher education
in India. Likewise, the budgetary allocation towards Higher
education increased from INR29,703 crore in FY17 to INR33,330 crore
in FY18 recording y-o-y growth of 12.2%. Higher governmental
expenditure is propelling the growth of Universities and with the
growing number of universities, the number of colleges affiliated
to these universities also witnessed a rise which has facilitated
more and more opportunities to students spread across the nation.
The growth in the number of universities and colleges together with
the variety of courses on offer has resulted in an increase in the
overall market size of Indian higher education segment and also
number of student enrolments over a period of time.
Azad Educational Society was established in 1998 under the Society
Registration Act, 1992 with an objective to provide education
services by establishing and operating various educational
institutions. The society is presently running 5 colleges under the
name of "Azad Group of Educational Institutions" (AGEI) at its 55
acre campus at Cantt. Road.
B. RAMANAIAH: CRISIL Lowers Rating on INR14cr Overdraft to B
------------------------------------------------------------
CRISIL has revised the ratings on bank facilities of B. Ramanaiah
Constructions (BRC) to 'CRISIL B/Stable/CRISIL A4 Issuer Not
Cooperating' from 'CRISIL BB-/Stable/CRISIL A4+ Issuer Not
Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Bank Guarantee 10 CRISIL A4 (ISSUER NOT
COOPERATING; Revised from
'CRISIL A4+ ISSUER NOT
COOPERATING')
Overdraft 14 CRISIL B/Stable (ISSUER NOT
COOPERATING; Revised from
'CRISIL BB-/Stable ISSUER NOT
COOPERATING')
CRISIL has been consistently following up with BRC for obtaining
information through letters and emails dated March 17, 2020 and
September 16, 2020 among others, apart from telephonic
communication. However, the issuer has remained non cooperative.
'The investors, lenders and all other market participants should
exercise due caution with reference to the rating assigned/reviewed
with the suffix 'ISSUER NOT COOPERATING' as the rating is arrived
at without any management interaction and is based on best
available or limited or dated information on the company. Such non
co-operation by a rated entity may be a result of deterioration in
its credit risk profile. These ratings with 'ISSUER NOT
COOPERATING' suffix lack a forward looking component.'
Detailed Rationale
Despite repeated attempts to engage with the management, CRISIL
failed to receive any information on either the financial
performance or strategic intent of BRC, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes that rating action on BRC is consistent
with 'Assessing Information Adequacy Risk'. Based on the last
available information, the ratings on bank facilities of BRC
revised to 'CRISIL B/Stable/CRISIL A4 Issuer Not Cooperating' from
'CRISIL BB-/Stable/CRISIL A4+ Issuer Not Cooperating'.
Incorporated in 1986 as a sole-proprietorship concern, Andhra
Pradesh-based BRC was reconstituted as partnership concern in 2001.
It constructs roads and undertakes maintenance activities. The firm
is promoted by Mr. B. Ramanaiah and family.
BHADOHI CARPETS: CRISIL Keeps B+ Debt Ratings in Not Cooperating
----------------------------------------------------------------
CRISIL said the ratings on bank facilities of Bhadohi Carpets (BCT)
continue to be 'CRISIL B+/Stable Issuer Not Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Export Packing 9 CRISIL B+/Stable (ISSUER NOT
Credit COOPERATING)
Foreign Bill 3 CRISIL B+/Stable (ISSUER NOT
Purchase COOPERATING)
Foreign Letter 0.5 CRISIL B+/Stable (ISSUER NOT
of Credit COOPERATING)
CRISIL has been consistently following up with BCT for obtaining
information through letters and emails dated March 17, 2020 and
September 16, 2020 among others, apart from telephonic
communication. However, the issuer has remained non cooperative.
'The investors, lenders and all other market participants should
exercise due caution with reference to the rating assigned/reviewed
with the suffix 'ISSUER NOT COOPERATING' as the rating is arrived
at without any management interaction and is based on best
available or limited or dated information on the company. Such non
co-operation by a rated entity may be a result of deterioration in
its credit risk profile. These ratings with 'ISSUER NOT
COOPERATING' suffix lack a forward looking component.'
Detailed Rationale
Despite repeated attempts to engage with the management, CRISIL
failed to receive any information on either the financial
performance or strategic intent of BCT, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes that rating action on BCT is consistent
with 'Assessing Information Adequacy Risk'. Based on the last
available information, the ratings on bank facilities of BCT
continues to be 'CRISIL B+/Stable Issuer Not Cooperating'.
BCT was incorporated in March 2012 after the partition of Rupesh
Kumar & Brothers into the firms BCT and Rupesh Kumar & Sons. BCT,
promoted by Mr. Pankaj Kumar Baranwal, Ms Madhu Baranwal, and Mr.
Priyam Baranwal, manufactures and exports carpets. It has multiple
production centres in Bhadohi, Uttar Pradesh.
BNK ENERGY: CARE Lowers Rating on INR2.0cr LT Loan to C
-------------------------------------------------------
CARE Ratings revised the ratings on certain bank facilities of BNK
Energy Alternatives (BNK), as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank 2.00 CARE C; Stable; Issuer not
Facilities cooperating; Revised from
CARE B; Stable; on the basis
of best available information
Short-term Bank 3.00 CARE A4; Issuer not
Facilities cooperating; Based on best
available information
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated August 26, 2019, placed the
ratings of BNK under the 'issuer non-cooperating' category as BNK
had failed to provide information for monitoring of the rating. BNK
continues to be non-cooperative despite repeated requests for
submission of information through e-mails, phone calls and email
dated September 21, 2020, September 18, 2020 and September 16,
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 has been revised by taking into account non-availability
of requisite information and no due-diligence conducted due to
non-cooperation by BNK Energy Alternatives 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. Further, the ratings continue to remain constrained by
firm's small scale of operations, leveraged capital structure and
working capital intensive nature of business. Further, the ratings
are also constrained by risk associated with stiff competition from
large number of unorganized players, business risk associated with
tender-based orders and operations exposed to climatic conditions
and technological risks. The ratings, however, continue to take
comfort from experienced partners coupled with moderate
profitability margins and debt coverage indicators.
Detailed description of the key rating drivers
Key Rating Weaknesses
* Small scale of operations: The firm is a small regional player
involved in installation and commissioning of solar power plants.
The ability of the firm to scale up to larger-sized contracts
having better operating margins is constrained by its comparatively
low capital base of INR1.05 crore as on March 31, 2017 and total
operating income of INR7.31 crore in FY17 (refers to the period
April 01 to March 31).
* Leveraged capital structure: The capital structure of the firm
stood leveraged owing to higher dependence on external borrowings
coupled with low net worth base as marked by overall gearing ratio
which stood above 1.50x as on March 31, 2017.
* Working capital intensive nature of business: The operations of
the firm are working capital intensive in nature as reflected by
higher average utilization of its sanctioned working capital
limits. The operating capital cycle however appears to be moderate
primarily as the firm receives a high payable period of around 5-6
months from its suppliers; while on the other hand, realization of
receivables owing to lengthy clearance processes with the
government departments results in a similar collection period. The
average creditor's period and average collection period for FY17
stood high at 169 days and 199 days respectively. The firm
maintains inventory in the form of raw material as well as finished
goods of around two months to ensure smooth execution of order and
meet the immediate demand of its customers
* Stiff competition from large number of unorganized players: No
significant investment or specialization is required for the system
integrator (SI) work carried out by BNK which results in low entry
barriers for the business. These low entry barriers have resulted
in large number of organized and unorganized players entering the
industry which has led to increased competition. Further, with
increasing growth opportunities for solar energy sector due to
government support/incentives, more players are entering the
industry thereby increasing competition.
* Business risk associated with tender-based orders: The firm
undertakes solar projects, which are awarded through the
tender-based system. The firm is exposed to the risk associated
with the tender-based business, which is characterized by intense
competition. The growth of the business depends on its ability to
successfully bid for the tenders and emerge as the lowest bidder.
Further, any changes in the government policy or government
spending on projects are likely to affect the revenues of the
firm.
* Operations exposed to climatic conditions and technological
risks: The operations of the firm are exposed to climatic
conditions as well as technological risks pertaining to adequate
availability of sunlight and any redundancy associated with the
operational efficiency of PV modules. As per government of
Rajasthan (GoR), Rajasthan enjoys around 300 to 330 days of
sunshine in a year and solar energy is estimated at 6-7 KWH/ sq.
mtr of solar insolation levels.
Key Rating Strengths
* Experienced partners coupled with moderate profitability margins
and debt coverage indicators: BNK is being managed by seven
partners i.e. Mr. Santosh Kumar Rajgarhia, Mr. Shailesh Ram
Rajgarhia, Ms. Neetu Kumari, Ms. Sonu Kumari, Mr. Sanjay Kumar
Rajgarhia, Mr. Raminder Singh and Mr. Raj Kumar Roy. All the
promoters are from diverse business background and have good
experience in solar industry. Besides that, the firm is managed by
qualified professionals having the requisite technical knowledge
and skills thereby providing synergistic advantage to the firm in
terms of successful project execution and commissioning. The
profitability margins of BNK stood moderate owing to service nature
of industry where profitability margins are moderate as marked by
PBILDT and PAT margin which remained above 5.60% and 2.90%
respectively for the past two financial years i.e. FY16-FY17.
Further, the debt coverage indicators stood moderate as marked by
interest coverage ratio of 1.88x and total debt to GCA of 7.37x in
FY17 on account of moderate profitability margins.
Ghaziabad (Uttar Pradesh) based, BNK Energy Alternatives (BNK) was
established as a partnership firm in the year 2016 and is currently
being managed by its partners namely Mr. Santosh Kumar Rajgarhia,
Mr. Shailesh Ram Rajgarhia, Ms. Neetu Kumari, Ms. Sonu Kumari, Mr.
Sanjay Kumar Rajgarhia, Mr. Raminder Singh and Mr. Raj Kumar Roy
sharing profit and loss in the ratio of 49%, 49%, 0.40%, 0.40%,
0.40%, 0.40% and 0.40%. The firm has succeeded an erstwhile
proprietorship firm M/s BNK Energy Alternatives which was
established in 2006 by Mr. Santosh Rajgharia. The firm is engaged
into installation and commissioning of solar power plants. The key
raw material required are solar panels, solar modules, batteries,
cables, solar inverters, etc. which they procure from manufacturers
located locally.
BRIJLAX MOTORS: CRISIL Lowers Rating on INR12.5cr Loans to B
------------------------------------------------------------
CRISIL has revised the ratings on bank facilities of Brijlax Motors
Private Limited (BMPL) to 'CRISIL B/Stable Issuer Not Cooperating'
from 'CRISIL BB-/Stable Issuer Not Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 2.5 CRISIL B/Stable (ISSUER NOT
COOPERATING; Revised from
'CRISIL BB-/Stable ISSUER NOT
COOPERATING')
Electronic Dealer 10 CRISIL B/Stable (ISSUER NOT
Financing Scheme COOPERATING; Revised from
(e-DFS) 'CRISIL BB-/Stable ISSUER NOT
COOPERATING')
CRISIL has been consistently following up with BMPL for obtaining
information through letters and emails dated March 17, 2020 and
September 16, 2020 among others, apart from telephonic
communication. However, the issuer has remained non cooperative.
'The investors, lenders and all other market participants should
exercise due caution with reference to the rating assigned/reviewed
with the suffix 'ISSUER NOT COOPERATING' as the rating is arrived
at without any management interaction and is based on best
available or limited or dated information on the company. Such non
co-operation by a rated entity may be a result of deterioration in
its credit risk profile. These ratings with 'ISSUER NOT
COOPERATING' suffix lack a forward looking component.'
Detailed Rationale
Despite repeated attempts to engage with the management, CRISIL
failed to receive any information on either the financial
performance or strategic intent of BMPL, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes that rating action on BMPL is consistent
with 'Assessing Information Adequacy Risk'. Based on the last
available information, the ratings on bank facilities of BMPL
Revised to 'CRISIL B/Stable Issuer Not Cooperating' from 'CRISIL
BB-/Stable Issuer Not Cooperating'.
BMPL, established in 1995 at Varanasi, is a dealer for passenger
vehicles of TML. Mr. Bimal, Mr. Vinamra and Ms Asha are the
promoters.
BULAND CONSTRUCTION: CARE Keeps D Debt Ratings in Not Cooperating
-----------------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Buland
Construction (BC) continues to remain in the 'Issuer Not
Cooperating' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Bank 5.25 CARE D; Issuer not cooperating;
Facilities Based on best available
information
Long 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 August 26, 2019, placed the
ratings of BC under the 'issuer non-cooperating' category as BC had
failed to provide information for monitoring of the rating. BC
continues to be noncooperative despite repeated requests for
submission of information through e-mails, phone calls and an email
dated September 21, 2020, September 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. Further
banker could not be contacted.
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 non-availability of requisite
information and no due-diligence conducted due to noncooperation by
Buland Construction 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.
Detailed description of the key rating drivers
At the time of last rating on August 26, 2019, the following were
the rating strengths and weaknesses:
The rating takes into account on-going delays in debt servicing
due to stretched liquidity position.
Ghaziabad (Uttar Pradesh) based Buland construction (BC) was
incorporated in 2011 as a partnership firm Mr. Sandeep Sharma and
Mr. Rakesh Sharma. They manage the overall business operations of
the firm. BC is engaged in execution of civil construction projects
such as construction of roads and bridges mainly for PWD (Public
Works Department) in Haryana, and Uttar Pradesh. The raw material
for the firm consists mainly of sand, cement, steel bars etc. which
it procures from various dealers and distributors in the domestic
market.
CAPITAL PROPMART: CRISIL Keeps B+ Debt Rating in Not Cooperating
----------------------------------------------------------------
CRISIL said the rating on bank facilities of Capital propmart
Private Limited (CPPL) continues to be 'CRISIL B+/Stable Issuer Not
Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Term Loan 9.5 CRISIL B+/Stable (ISSUER NOT
COOPERATING)
CRISIL has been consistently following up with CPPL for obtaining
information through letters and emails dated March 17, 2020 and
September 16, 2020 among others, apart from telephonic
communication. However, the issuer has remained non cooperative.
'The investors, lenders and all other market participants should
exercise due caution with reference to the rating assigned/reviewed
with the suffix 'ISSUER NOT COOPERATING' as the rating is arrived
at without any management interaction and is based on best
available or limited or dated information on the company. Such non
co-operation by a rated entity may be a result of deterioration in
its credit risk profile. These ratings with 'ISSUER NOT
COOPERATING' suffix lack a forward looking component.'
Detailed Rationale
Despite repeated attempts to engage with the management, CRISIL
failed to receive any information on either the financial
performance or strategic intent of CPPL, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes that rating action on CPPL is consistent
with 'Assessing Information Adequacy Risk'. Based on the last
available information, the ratings on bank facilities of CPPL
continues to be 'CRISIL B+/Stable Issuer Not Cooperating'.
CPPL, set up in 2006, is based in Bihar, and is setting up a godown
which will be leased to Food Corporation of India. The company is
owned and managed by the Jhawar family.
CASTWEL INDUSTRIES: CRISIL Lowers Rating on INR5cr Loan to B
------------------------------------------------------------
CRISIL has revised the ratings on bank facilities of Castwel
Industries (Castwel) to 'CRISIL B/Stable/CRISIL A4 Issuer Not
Cooperating' from 'CRISIL BB+/Stable/CRISIL A4+ Issuer Not
Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Bank Guarantee 4 CRISIL A4 (ISSUER NOT
COOPERATING; Revised from
'CRISIL A4+ ISSUER NOT
COOPERATING')
Cash Credit 5 CRISIL B/Stable (ISSUER NOT
COOPERATING; Revised from
'CRISIL BB+/Stable ISSUER NOT
COOPERATING')
Letter of Credit 3 CRISIL A4 (ISSUER NOT
COOPERATING; Revised from
'CRISIL A4+ ISSUER NOT
COOPERATING')
Proposed Long Term 1.09 CRISIL B/Stable (ISSUER NOT
Bank Loan Facility COOPERATING; Revised from
'CRISIL BB+/Stable ISSUER NOT
COOPERATING')
Standby Letter .75 CRISIL B/Stable (ISSUER NOT
of Credit COOPERATING; Revised from
'CRISIL BB+/Stable ISSUER NOT
COOPERATING')
CRISIL has been consistently following up with Castwel for
obtaining information through letters and emails dated
March 17, 2020 and September 16, 2020 among others, apart from
telephonic communication. However, the issuer has remained non
cooperative.
'The investors, lenders and all other market participants should
exercise due caution with reference to the rating assigned/reviewed
with the suffix 'ISSUER NOT COOPERATING' as the rating is arrived
at without any management interaction and is based on best
available or limited or dated information on the company. Such non
co-operation by a rated entity may be a result of deterioration in
its credit risk profile. These ratings with 'ISSUER NOT
COOPERATING' suffix lack a forward looking component.'
Detailed Rationale
Despite repeated attempts to engage with the management, CRISIL
failed to receive any information on either the financial
performance or strategic intent of Castwel, which restricts
CRISIL's ability to take a forward looking view on the entity's
credit quality. CRISIL believes that rating action on Castwel is
consistent with 'Assessing Information Adequacy Risk'. Based on the
last available information, the ratings on bank facilities of
Castwel revised to 'CRISIL B/Stable/CRISIL A4 Issuer Not
Cooperating' from 'CRISIL BB+/Stable/CRISIL A4+ Issuer Not
Cooperating'.
Set up in 1982, Castwel is a Nagpur (Maharashtra)-based partnership
firm that manufactures various refractory products such as
high-alumina cement, castables, and pre-cast pre-fired shapes.
These products are used in the cement, steel, power, hydrocarbon,
and other industries. Castwel also undertakes product installation
and commissioning. Mr. M Shiv Kumar is the managing partner of the
firm.
DEEPAK YADAV: CRISIL Keeps B Debt Rating in Not Cooperating
-----------------------------------------------------------
CRISIL said the rating on bank facilities of Deepak Yadav & others
(DYAT) continues to be 'CRISIL B/Stable Issuer Not Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Term Loan 9 CRISIL B/Stable (ISSUER NOT
COOPERATING)
CRISIL has been consistently following up with DYAT for obtaining
information through letters and emails dated March 17, 2020 and
September 16, 2020 among others, apart from telephonic
communication. However, the issuer has remained non cooperative.
'The investors, lenders and all other market participants should
exercise due caution with reference to the rating assigned/reviewed
with the suffix 'ISSUER NOT COOPERATING' as the rating is arrived
at without any management interaction and is based on best
available or limited or dated information on the company. Such non
co-operation by a rated entity may be a result of deterioration in
its credit risk profile. These ratings with 'ISSUER NOT
COOPERATING' suffix lack a forward looking component.'
Detailed Rationale
Despite repeated attempts to engage with the management, CRISIL
failed to receive any information on either the financial
performance or strategic intent of DYAT, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes that rating action on DYAT is consistent
with 'Assessing Information Adequacy Risk'. Based on the last
available information, the ratings on bank facilities of DYAT
continues to be 'CRISIL B/Stable Issuer Not Cooperating'.
Established in 2016 by Mr. Deepak Yadav, Mr. Pawan Kumar, Mr.
Hoshiyar Singh and Mr. Ravinder Singh Yadav, DYAT is setting up a
warehouse in Pathredi, Gurgaon district.
DELTA CROP: CRISIL Keeps B+ Debt Ratings in Not Cooperating
-----------------------------------------------------------
CRISIL said the ratings on bank facilities of Delta Crop Sciences
Private Limited (DCSPL) continue to be 'CRISIL B+/Stable/CRISIL A4
Issuer not cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Bank Guarantee 1 CRISIL A4 (ISSUER NOT
COOPERATING)
Cash Credit 5 CRISIL B+/Stable (ISSUER NOT
COOPERATING)
Proposed Long Term 2 CRISIL B+/Stable (ISSUER NOT
Bank Loan Facility COOPERATING)
Working Capital 2 CRISIL B+/Stable (ISSUER NOT
Demand Loan COOPERATING)
CRISIL has been consistently following up with DCSPL for obtaining
information through letters and emails dated March 17, 2020 and
September 16, 2020 among others, apart from telephonic
communication. However, the issuer has remained non cooperative.
'The investors, lenders and all other market participants should
exercise due caution with reference to the rating assigned/reviewed
with the suffix 'ISSUER NOT COOPERATING' as the rating is arrived
at without any management interaction and is based on best
available or limited or dated information on the company. Such non
co-operation by a rated entity may be a result of deterioration in
its credit risk profile. These ratings with 'ISSUER NOT
COOPERATING' suffix lack a forward looking component.'
Detailed Rationale
Despite repeated attempts to engage with the management, CRISIL
failed to receive any information on either the financial
performance or strategic intent of DCSPL, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes that rating action on DCSPL is consistent
with 'Assessing Information Adequacy Risk'. Based on the last
available information, the ratings on bank facilities of DCSPL
continues to be 'CRISIL B+/Stable/CRISIL A4 Issuer not
cooperating'.
Delta Crop Sciences Private Limited (DCSPL), established in 2007 is
involved in the business of production, processing and sale of
hybrid seeds. The Company has a seed processing facilities at
Yediur near Bangalore and a corporate office in Bangalore.
ELWOOD PARK: Second Creditors' Meeting Set for Oct. 26
------------------------------------------------------
A second meeting of creditors in the proceedings of Elwood Park Pty
Ltd ATF The Richard Johnson Family Trust, trading as Justeel, has
been set for Oct. 26, 2020, at 11:00 a.m. The meeting will be
conducted by online video conference using Zoom Meetings.
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 Oct. 22, 2020, at 5:00 p.m.
Sam Kaso and Barry Wight of Cor Cordis were appointed as
administrators of Elwood Park on Sept. 18, 2020.
EXCEL METAL: CARE Keeps D Debt Ratings in Not Cooperating Category
------------------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Excel Metal
Processors Private Limited (EMPPL) continues to remain in the
'Issuer Not Cooperating' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long term Bank 38.12 CARE D; Issuer not cooperating;
Facilities Based on best available
information
Short term Bank 20.00 CARE D; Issuer not cooperating;
Facilities Based on best available
information
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated July 8, 2019, placed rating
of EMPPL under CARE D 'Issuer not cooperating' category as EMPPL
had failed to provide information for monitoring as agreed in
Rating Agreement. EMPPL continues to be non-cooperative despite
repeated requests for submission of information through e-mails
dated September 18, 2020, September 21, 2020 and September 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. The rating of EMPPL will now be denoted as CARE D; ISSUER
NOT COOPERATING.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating(s).
The ratings take into account the ongoing delays in debt servicing
by the company.
Detailed description of the key rating drivers
Key Rating Weaknesses
* Delay in debt servicing obligations: The ratings of Excel Metal
Processors Private Limited continue to reflect on-going delays in
servicing of debt obligations by the company.
Excel Metal Processors Private Limited (EMPPL) is promoted by Mr.
Mohammed Iqbal Khan and Mr. Imran Khan, whose family has been in
the steel business for more than five decades. The other major
company of the promoters is Western India Metal Processors Limited
which is engaged in trading in prime steel, metal scrap and
chemical trading and metal recycling processes for separation of
scrap. EMPPL, incorporated in May 2012, is engaged in processing of
hot rolled and cold rolled steel coils by cutting, slitting and
then marketing for retail requirements.
HERO FINCORP: Moody's Assigns Ba1 CFR, Outlook Negative
-------------------------------------------------------
Moody's Investors Service assigned a Ba1 Corporate Family Rating to
Hero FinCorp Limited and has withdrawn the Ba1 local and foreign
currency issuer rating.
Hero FinCorp's rating outlook, as applicable, is maintained as
negative.
RATINGS RATIONALE
Hero FinCorp's Ba1 CFR is three notches higher than its b1
standalone assessment, reflecting Moody's assumption of a very high
likelihood of support from its key shareholder, Hero MotoCorp
Limited (HMCL), in times of need.
Hero FinCorp's b1 standalone assessment incorporates Moody's
expectation that Hero FinCorp's asset quality and profitability
will weaken as loan delinquencies and defaults increase, because
customers and businesses face a drop in earnings and cash flows due
to the economic disruptions caused by the coronavirus outbreak.
Hero FinCorp's unseasoned loan book also poses risks to asset
quality, given its limited operating track record and rapid growth
in the past few years.
Capital is a credit strength of Hero FinCorp, supported by capital
infusions from its shareholders. Moody's expects Hero FinCorp's
capital will remain largely stable as the company looks to conserve
liquidity and avoid expanding its balance sheet until economic
conditions normalize. Hero FinCorp has access to committed capital
from its shareholders that is callable by the company before the
end of the fiscal year ending March 2021.
Despite the tight liquidity conditions for Indian non-bank
financial companies (NBFCs), Hero FinCorp has been able to
refinance its maturing obligations. The company's strong links with
its parent helps it access banks and debt market investors for
funding.
Nevertheless, its modest liquidity buffers have left it exposed to
volatile refinancing conditions.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
Given the negative outlook, an upgrade is unlikely in the near
term. The outlook could return to stable if Hero FinCorp is able to
absorb the impact of the asset quality deterioration and higher
credit costs in the current fiscal year without materially
impacting its capital position, and if profitability and asset
quality are likely to stabilize beyond fiscal year ending March
2021.
Moody's could downgrade the company's ratings if there is a
material deterioration in its asset quality, which leads to more
pressure on its profitability, or if its funding and liquidity
profiles deteriorate. Any change to Moody's expectation of support
from HMCL will also lead to pressure on Hero FinCorp's ratings.
PRINCIPAL METHODOLOGY
The principal methodology used in these ratings was Finance
Companies Methodology published in November 2019.
Headquartered in New Delhi, Hero FinCorp Limited reported total
assets of INR 256 billion at March 31, 2020.
K. T. RAVI: CARE Lowers Rating on INR7cr LT Loan to C
-----------------------------------------------------
CARE Ratings revised the ratings on certain bank facilities of K.
T. Ravi (KTR), as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long-term Bank 7.00 CARE C; Stable; Issuer not
Facilities cooperating; Revised from
CARE BB-; Stable; on the basis
of best available information
Short-term Bank 3.00 CARE A4; Issuer not
Facilities cooperating; Based on best
available information
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated August 8, 2019, placed the
rating(s) of KTR under the 'issuer not cooperating' category as KTR
had failed to provide information for monitoring of the rating. KTR
continues to be non-cooperative despite repeated requests for
submission of information through phone calls and e-mails dated
September 2, 2020 to September 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.
The ratings have been revised on account of non-availability of
last three year financials.
Detailed description of the key rating drivers
At the time of last press release dated August 8, 2019 the
following were the rating strengths and weaknesses:
Key Rating Weakness
* Small sale of operations: The firm was established in the year
1994 and despite long track record of the firm; its scale of
operations remained small as compared to other industry peers. The
total operating income was INR25.15 crore during FY15 (Provisional
– refers to the period April 1 to March 31) and the firm also had
low net worth base of INR5.56 crore as on March 31, 2015.
Furthermore, the works executed include majorly road works and
irrigation works which are procured from government organizations,
representing revenue concentration risk.
* Working capital intensive nature of business: The firm is engaged
in civil construction works such as laying roads and irrigation
works for government organizations which is working capital
intensive in nature. The firm follows percentage completion method
billing cycle and receives payment within 3 - 4 months. However, it
has to pay the creditors in about 30 - 40 days for the raw
materials supplied. On account of these factors, the firm relies on
the bank borrowings for funding their day to day operations and to
bridge the gap between the receivables and payables. Average
working capital utilization of KTR stood high at about 90% for the
last 12 months ended May 31, 2015.
* Constitution of the entity as a proprietorship firm: Constitution
as a proprietorship firm has the inherent risk of possibility of
withdrawal of the proprietors' capital at the time of personal
contingency which can affect its capital structure. This was
reflected in the balance sheet as on March 31, 2015 when
the capital to the tune of INR0.11 crore was withdrawn to meet
personal contingency. Furthermore, the proprietorship firm
has restricted access to external borrowing which limits its growth
opportunities to some extent.
Key Rating Strengths
* Qualified and experienced proprietor in the same line of
business: The firm is established and managed by Mr. K T Ravi, an
Engineering graduate and Class – I contractor, with around 21
years of experience in civil contract works. Mr. K T Ravi has been
successfully handling road construction and maintenance works under
Public Works Department (PWD), State Highway Development Projects
of Government of Karnataka and rural development programs by
Panchayat Raj. The industry experience of the proprietor has helped
the firm in procuring contracts from government organizations.
* Healthy growth in total operating income and comfortable profit
margins during FY13-FY15: The total operating income of the company
grew y-o-y during the last three financial year ended FY15, at a
Compounded Annual Growth Revenue (CAGR) of 35.19%. The revenue has
increased from INR21.70 core in FY14 to INR25.15 crore in FY15
representing a growth of 15.93% on account of increase in new
projects and completion of ongoing projects. PBILDT and APAT
margins of the company have remained comfortable at 13.60% and
7.99% during FY15 albeit have declined compared to the previous
year on account of increased input cost which could not be passed
on due to absence of escalation clause in contracts.
* Moderate financial risk profile: The financial risk profile of
the company is marked by moderate capital structure and
satisfactory debt coverage indicators. The overall gearing ratio
has improved from 1.71 times as on March 31, 2014 to 1.06 times as
on March 31, 2015 on account of accretion of profits to the net
worth and scheduled repayment of existing debt. The reduced
interest burden on term debt coupled with increase in PBILDT has
led to a favourable interest coverage of 5.51 times in FY15
provisional (4.55 times in FY14) and total debt/GCA of 2.47 times
in FY15 provisional (2.95 times in FY14). The firm had not availed
any moratorium on its debt obligations.
Mysore-based M/s. K. T. Ravi (KTR) was established by an
engineering graduate, Mr. K T Ravi in the year 1994 as a
proprietorship concern. The firm is engaged in civil construction
works such as laying roads and irrigation works for government
organizations covering Public Works Department (PWD) and Panchayat
Raj which are procured through tenders. Mr. K T Ravi is a Class
– I contractor and has experience of more than two decades in
civil contract works.
KARPADHA AGRO: CARE Keeps D Debt Ratings in Not Cooperating
-----------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Shri
Karpadha Agro Foods (SKAF) continues to remain in the 'Issuer Not
Cooperating' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Bank 9.40 CARE D; Issuer not cooperating;
Facilities Based on best available
information
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated August 2, 2019, placed the
rating(s) of SKAF under the 'issuer not cooperating' category as
SKAF had failed to provide information for monitoring of the
rating. Shri Karpadha Agro Foods continues to be non-cooperative
despite repeated requests for submission of information through
phone calls and emails dated September 14, 2020 to September 21,
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 press release dated August 2, 2019 the
following were the rating strengths and weaknesses:
Key Rating Weakness
* Ongoing delays in meeting of debt obligations: The firm is unable
to generate sufficient cash flows leading to strained liquidity
position resulting in ongoing delays in meeting its debt
obligations in time.
Key rating strengths
* Long experience of promoters' family in rice milling industry:
Mr. P.Palanisamy is the main promoter of SKAF and has an overall
experience of 17 years in this industry. Prior to establishment of
KAF, he was engaged in rice milling business as a partner in a firm
established by family members. Subsequently, he retired from that
firm and established KAF. Mr.P.Kalaivanan, one of the promoters is
an Electronics and Electrical Engineering graduate and was looking
after machinery maintenance. Mr.P.Arul, presently the Managing
Partner in SKAF is an MBA graduate specialized. Prior to
establishment of KAF, he was assisting in rice milling business
established by family members looking after the overall operations.
Ms. Lalithambigai, partner joined the firm from April 2016.
Shri Karpadha Agro Foods (SKAF) is a partnership firm engaged in
rice milling business and the present partners are Mr. Arul and Ms.
Lalithambigai. Originally the firm was established in 2006 in the
name of "Karpadha Agro Foods" (KAF) promoted by Mr. P. Palanisamy,
Mrs. P. Dhanam, Mr. P. Kalaivanan and Mr. P. Arul. Subsequently the
partnership was reconstituted in April 2015.
MAHAA LAKSHMI: CRISIL Keeps B- Debt Ratings in Not Cooperating
--------------------------------------------------------------
CRISIL said the ratings on bank facilities of Mahaa Lakshmi Cold
Storage (MLCS) continue to be 'CRISIL B-/Stable Issuer Not
Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Long Term Loan 4.5 CRISIL B-/Stable (ISSUER NOT
COOPERATING)
Proposed Long Term 1.5 CRISIL B-/Stable (ISSUER NOT
Bank Loan Facility COOPERATING)
CRISIL has been consistently following up with MLCS for obtaining
information through letters and emails dated March 17, 2020 and
September 16, 2020 among others, apart from telephonic
communication. However, the issuer has remained non cooperative.
'The investors, lenders and all other market participants should
exercise due caution with reference to the rating assigned/reviewed
with the suffix 'ISSUER NOT COOPERATING' as the rating is arrived
at without any management interaction and is based on best
available or limited or dated information on the company. Such non
co-operation by a rated entity may be a result of deterioration in
its credit risk profile. These ratings with 'ISSUER NOT
COOPERATING' suffix lack a forward looking component.'
Detailed Rationale
Despite repeated attempts to engage with the management, CRISIL
failed to receive any information on either the financial
performance or strategic intent of MLCS, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes that rating action on MLCS is consistent
with 'Assessing Information Adequacy Risk'. Based on the last
available information, the ratings on bank facilities of MLCS
continues to be 'CRISIL B-/Stable Issuer Not Cooperating'.
Established in June 2017, Mahaa Lakshmi Cold Storage (MLCS) runs a
cold storage unit in Narasaraopet, Andhra Pradesh. The unit started
commercial operations in March 2018. It provides services of cold
storage to farmers and traders in Narasaraopet Village and
surrounding area and is promoted by Mr. Mallikarjuna Rao and 8
other partners.
MANGALORE MARKETING: CRISIL Keeps B+ Rating in Not Cooperating
--------------------------------------------------------------
CRISIL said the rating on bank facilities of Mangalore Marketing
(MM) continues to be 'CRISIL B+/Stable Issuer Not Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 9 CRISIL B+/Stable (ISSUER NOT
COOPERATING)
CRISIL has been consistently following up with MM for obtaining
information through letters and emails dated March 17, 2020 and
September 16, 2020 among others, apart from telephonic
communication. However, the issuer has remained non cooperative.
'The investors, lenders and all other market participants should
exercise due caution with reference to the rating assigned/reviewed
with the suffix 'ISSUER NOT COOPERATING' as the rating is arrived
at without any management interaction and is based on best
available or limited or dated information on the company. Such non
co-operation by a rated entity may be a result of deterioration in
its credit risk profile. These ratings with 'ISSUER NOT
COOPERATING' suffix lack a forward looking component.'
Detailed Rationale
Despite repeated attempts to engage with the management, CRISIL
failed to receive any information on either the financial
performance or strategic intent of MM, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes that rating action on MM is consistent
with 'Assessing Information Adequacy Risk'. Based on the last
available information, the ratings on bank facilities of MM
continues to be 'CRISIL B+/Stable Issuer Not Cooperating'.
MM, set up in 2001 by Mr. Basheer, is a partnership firm based in
Mangalore. The firm distributes electronics equipment of LG,
Preethi and Ajanta Stabilisers, and is the distributor for dish TV.
PRASHANT CASTECH: CRISIL Lowers Rating on INR1cr Cash Loan to B
---------------------------------------------------------------
CRISIL has revised the ratings on bank facilities of Prashant
Castech Private Limited (PCPL) to 'CRISIL B/Stable/CRISIL A4 Issuer
Not Cooperating' from 'CRISIL BB+/Stable/CRISIL A4+ Issuer Not
Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 1 CRISIL B/Stable (ISSUER NOT
COOPERATING; Revised from
'CRISIL BB+/Stable ISSUER NOT
COOPERATING')
Export Packing 9 CRISIL A4 (ISSUER NOT
Credit COOPERATING; Revised from
'CRISIL A4+ ISSUER NOT
COOPERATING')
CRISIL has been consistently following up with PCPL for obtaining
information through letters and emails dated March 17, 2020 and
September 16, 2020 among others, apart from telephonic
communication. However, the issuer has remained non cooperative.
'The investors, lenders and all other market participants should
exercise due caution with reference to the rating assigned/reviewed
with the suffix 'ISSUER NOT COOPERATING' as the rating is arrived
at without any management interaction and is based on best
available or limited or dated information on the company. Such non
co-operation by a rated entity may be a result of deterioration in
its credit risk profile. These ratings with 'ISSUER NOT
COOPERATING' suffix lack a forward looking component.'
Detailed Rationale
Despite repeated attempts to engage with the management, CRISIL
failed to receive any information on either the financial
performance or strategic intent of PCPL, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes that rating action on PCPL is consistent
with 'Assessing Information Adequacy Risk'. Based on the last
available information, the ratings on bank facilities of PCPL
revised to 'CRISIL B/Stable/CRISIL A4 Issuer Not Cooperating' from
'CRISIL BB+/Stable/CRISIL A4+ Issuer Not Cooperating'.
Incorporated in 2009, Prashant Castech is promoted by the Rajkot
(Gujarat)-based Parsana family. It manufactures cast iron castings
of various sizes for large global engineering companies. The
Prashant group has manufacturing units in Rajkot.
Incorporated in 1987, Prashant Castings also manufactures cast iron
castings.
RAJRANI COLD: CARE Keeps D Debt Rating in Not Cooperating Category
------------------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Rajrani
Cold Storage and Ice Plant Private Limited (RCI) continues to
remain in the 'Issuer Not Cooperating' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Bank 13.71 CARE D; Issuer not cooperating;
Facilities Based on best available
information
Detailed Rationale & Key Rating Drivers
CARE had, vide its press release dated August 20, 2019, placed the
ratings of RCI under the 'issuer non-cooperating' category as RCI
had failed to provide information for monitoring of the rating. RCI
continues to be non-cooperative despite repeated requests for
submission of information through e-mails, phone calls and an email
dated September 7, 2020, September 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. Further banker could
not be contacted.
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 non-availability of requisite
information and no due-diligence conducted due to noncooperation by
Rajrani Cold Storage and Ice Plant 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.
Detailed description of the key rating drivers
At the time of last rating on August 20, 2019, the following were
the rating strengths and weaknesses:
The rating takes into account on-going delays in debt servicing due
to stretched liquidity position
Incorporated in 1989, Raj Rani Cold Storage and Ice Plant Private
Limited (RCI) was promoted by Mr. Sushil Tripathi. The company is
engaged in manufacturing and processing of milk and milk products
and also operates a cold storage unit for storage of potatoes. The
main products of RCI includes skimmed milk powder (SMP), Desi Ghee,
condensed milk, Whole Milk Powder, Poly pack milk, table butter,
sweet curd etc. The company sells its products under the brand name
'Raj'. The company caters to various dairy companies of Uttar
Pradesh, Haryana, Punjab and other states, through a network of
distributors. Most of the sales of the company are institutional
sales and retail sales are done by the company in states like
Delhi, Mumbai, etc. In addition to the milk processing, the company
has a cold storage facility for storing potatoes for the local
farmers. RCI is an ISO 22000:2005 and HACCP (Hazard Analysis and
Critical Control Points) certified company. In addition to this the
Ghee supplied by the company is hallmarked by Agmark for quality
purposes.
RELIANCE COMM: Court Seeks Chinese Banks' View on Ambani's Plea
---------------------------------------------------------------
BloombergQuint reports that an Indian court has reached out to a
group of Chinese banks that are trying to recover money from Anil
Ambani, in the latest twist in a personal bankruptcy case against
the former billionaire.
The trio of Chinese lenders won a ruling in a London court in May
after pursuing Ambani for more than $700 million in a dispute over
defaulted loans, BloombergQuint says. Ambani has requested that the
banks be included in his challenge to a separate bankruptcy case
against him in India, and the Delhi High Court is asking for their
views on that. It did not identify the banks by name.
In the London case, the Chinese lenders argued that they provided
funding to Ambani's Reliance Communications Ltd. in 2012 with the
condition that he personally guarantee the debt. They have yet to
receive any funds despite winning that ruling, BloombergQuint
notes.
BloombergQuint relates that the Delhi High Court also ordered a
moratorium on recoveries from any sale of Ambani's personal assets.
State Bank of India, which had earlier this year filed a bankruptcy
case against Ambani, had requested the moratorium, saying Indian
lenders might not get anything if Chinese banks execute the U.K.
court's orders.
According to BloombergQuint, a spokesperson for Anil Ambani said
the moratorium will protect SBI's interest and the court has issued
notices to three Chinese Banks -- Industrial and Commercial Bank of
China, Export Import Bank of China, and China Development Bank --
since the Indian lender based its application on apprehension that
the Chinese lenders may attempt to execute the U.K. Court's order.
Ambani will continue to take steps to defend himself in the matter,
the spokesperson said.
The bankruptcy case in India against Ambani remains halted by a
court order that also directed Ambani to not sell his assets,
BloombergQuint notes.
About Reliance Communications
Based in Mumbai, India, Reliance Communications Ltd is a
telecommunications service provider. The Company operates through
two segments: India Operations and Global Operations. India
operations segment comprises wireless telecommunications services
to retail customers through global system for mobile communication
(GSM) technology-based networks across India; voice, long distance
services and broadband access to enterprise customers; managed
Internet data center services, and direct-to-home (DTH) business.
Global operations comprise Carrier, Enterprise and Consumer
Business units. It provides carrier's carrier voice, carrier's
carrier bandwidth, enterprise data and consumer voice services. The
Company owns and operates Internet protocol (IP) enabled
connectivity infrastructure, comprising over 280,000 kilometers of
fiber optic cable systems in India, the United States, Europe,
Middle East and the Asia Pacific region.
The National Company Law Tribunal on May 9, 2019, allowed Reliance
Communications (RCom) to exclude the 357 days spent in litigation
and admitted it for insolvency. With this, RCom, which owes over
INR50,000 crore to banks, has become the first Anil Ambani group
company to be officially declared bankrupt after the NCLT on May 9
superseded its board and appointed a new resolution professional to
run it and also allowed the SBI-led consortium of 31 banks to form
a committee of creditors.
RENEW POWER: Fitch Assigns BB-(EXP) Rating on New Sec. Notes
------------------------------------------------------------
Fitch Ratings has assigned ReNew Power Private Limited Restricted
Group 3's (ReNew RG3) proposed US-dollar senior secured notes due
2024 an expected rating of 'BB-(EXP)'. The Outlook is Stable.
The final rating is contingent upon the receipt by Fitch of final
documents conforming to information already received as well as the
final pricing and financial close on the proposed notes.
RATING RATIONALE
The proposed 3.5-year bullet US-dollar bond will be issued by India
Green Energy Holdings (IGEH), a financing vehicle that has no
linkage with ReNew Power Private Limited (ReNew, BB-/Stable). IGEH
will use the proceed to subscribe to the Indian-rupee
non-convertible debentures (NCD) issued by the restricted group.
The restricted group will use the proceed to refinance its existing
senior debt and upstream a portion of it to ReNew as the initial
parent guarantor loan. The NCD benefits from a full-tenor guarantee
from ReNew as the parent guarantor.
Prior to the US dollar bond's maturity, ReNew will repay the
initial parent guarantor loan, which ReNew RG3 will use to
partially redeem the US dollar bond, and ReNew RG3 will refinance
its outstanding amount by a refinancing debt. Under the Fitch's
rating case, ReNew RG3 would not be able to fully amortise its
refinancing debt over the refinancing period without ReNew's
repayment of the initial parent guarantor loan. In addition, a
failure by ReNew to repay the initial parent guarantor loan would
result in an event of default. As such, the rating on the proposed
notes relies on ReNew's credit quality and, hence, Fitch rates the
proposed notes in line with ReNew.
The rating also reflects ReNew RG3's contracted revenue with
various state distribution companies (discoms) under long-term
fixed-price power-purchase agreements (PPA) for 324 MW of its total
capacity. The restricted group uses commercially proven wind and
solar technology. All projects are commissioned with a two- to
seven-year operating record. The restricted group has moderate
variability between its P50 and one-year P90 forecasts. Its
generation performance in 2019 was in line with its one-year P90
forecast.
ReNew Solar Energy Private Limited (RSEPL), a wholly owned
subsidiary of ReNew operating 38MW rooftop solar capacity, is not a
co-issuer within the restricted group, but will invest the free
cash flow generated from its rooftop solar projects as equity or
lend it as subordinated loans to the co-issuers. These projects,
while not part of the security package, will have negative liens to
not incur additional debt. This provides extra cash flow to the
restricted group, but is untested.
Fitch applies a criteria variation with respect to the counterparty
risk related to the state discoms and captive/third-party
customers. Fitch does not rate the off-takers, but Fitch does not
think that a default by one of them would necessarily lead to a
default of the transaction. However, Fitch believes it is prudent
to apply the merchant project threshold to revenue; Fitch applies a
revenue-based weighted average of the wind and solar merchant
project threshold to determine the rating.
KEY RATING DRIVERS
Short-Term O&M Contracts; Proven Technology: Operation Risk −
Midrange
ReNew RG3 consists of 282MW wind projects and 138 MW solar
projects, including 38MW rooftop solar projects operated by
non-restricted RSEPL, with an operating history of three years on a
capacity weighted-average basis. Fitch considers the technologies
deployed in this project as proven. Solar modules are sourced from
various internationally known suppliers, while wind turbines are
procured from some of the world's largest manufacturers. Operation
and maintenance (O&M) for the utility-scale solar projects is
carried out by an affiliate company, ReNew Power Services Private
Limited, under five-year fixed-price contracts with a 4% annual
price escalation. Meanwhile, O&M for the wind projects is carried
out by the original equipment manufacturers under long-term
contracts. The operation risk assessment is constrained to
'Midrange', given that the operating cost forecast is not validated
by an independent technical advisor and the absence of a
maintenance reserve account.
Operating Record Shows Moderate Variability: Revenue Risk (Volume)
− Midrange
The energy yield forecast produced by third-party consultants
indicates an overall P50/one-year P90 spread of between 6% and 16%,
leading to a 'Midrange' assessment for volume risk. All projects
have an operating history of more than two years. Since
commissioning, generation for most project has been in line with
P90 forecasts. Curtailment risk is limited in light of the must-run
status of Indian renewable energy plants.
Contract Renewal Risk Mitigated: Revenue Risk (Price) − Midrange
ReNew RG3 contracts 77% of its total capacity with state discoms
under long-term fixed-price PPA, which protect the portfolio from
merchant price volatility. PPAs with private customers have
contract terms that generally range from 10 to 25 years. The
restricted group has a capacity weighted-average remaining tenor of
19 years. Tariffs are fixed for most projects, except for
captive/third-party wind projects, whose tariffs are adjusted for
changes in grid tariffs. PPAs for captive/third-party solar
projects are close to expiry, with two to five years remaining
tenor, and are subject to contract renewal risk. Price risk related
to contract renewal is mitigated by rising grid tariffs and strong
energy demand in India. In addition, captive/third-party solar
projects account for only 14% of total capacity. Fitch assesses
price risk as 'Midrange'.
Significant Refinancing Risk; Reliance on Parent's Repayment: Debt
Structure - Midrange
IGEH will use the proceeds from the proposed US-dollar bond to
subscribe to the Indian-rupee NCD issued by ReNew RG3. IGEH is a
Mauritius-based SPV held by a trust that does not have linkages to
ReNew. It will not undertake any business activity other than
investing in the Indian-rupee NCD via issuance of the proposed
US-dollar bond.
The NCD is guaranteed by ReNew as the parent guarantor and benefits
from the usual protective structural features, including
distribution lockup at 1.30x the 12-month backward-looking interest
service coverage ratio. ReNew RG3 does not maintain debt service or
major maintenance reserve accounts. However, refinancing risk is
mitigated by the cash-trap requirement in the last six months of
the notes. RSEPL will invest the free cash flow generated from its
rooftop solar projects as equity or lend it as subordinated loans
to the co-issuers. The rooftop solar projects though will not form
a part of the security package, but are covenanted to not incur
additional indebtedness.
The proposed US-dollar bond benefits from IGEH's 100% share pledge
and a charge over all of IGEH's assets. Meanwhile, the NCD includes
a standard security package, such as a charge over movable and
immovable assets, and a share pledge of the restricted entities.
This provides US-dollar noteholders with indirect access to the
NCD's security package and is a common issuance structure adopted
by several other Fitch-rated transactions.
PEER GROUP
Fitch regards ReNew RG3 as comparable with Azure Power Solar Energy
Private Limited (APSEPL, senior secured: BB/Stable). Both projects
benefit from long-term fixed-price PPAs. APSEPL contracts with
sovereign-backed off-takers and unrated state discoms, while ReNew
RG3 contracts with unrated state discoms and private customers.
The expiring PPAs with private customers also expose ReNew RG3 to
contract renewal risk. ReNew RG3's wind projects have a higher
energy generation variation than its solar projects, while APSEPL
has only solar projects. Both groups have bullet US-dollar bonds.
The average annual debt service coverage ratio (DSCR) metric for
ReNew RG3 is higher than for APSEPL. Fitch applies a blended
merchant threshold for both ReNew RG3 and APSEPL to determine their
ratings, given the unrated off-takers; the threshold for ReNew RG3
is higher, as it is calculated on a revenue-based weighted average
of its wind and solar merchant projects.
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
An upgrade of the parent guarantor to above 'BB-'.
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
A downgrade of the parent guarantor to below 'BB-.
TRANSACTION SUMMARY
ReNew RG3 is a restricted group consisting of 11 SPVs under ReNew,
with total capacity of 382MW, mainly in Karnataka and Andhra
Pradesh. RSEPL, a subsidiary of ReNew, operates 38MW of rooftop
solar capacity; it is not a restricted entity within the restricted
group, but will invest the free cash flow generated from its
rooftop solar projects as equity or lend it as subordinated loans
to the co-issuers. The rooftop solar projects will not form part of
the security package, but are covenanted to not incur additional
debt. This provides extra cash flow to the restricted group, but is
untested.
IGEH is a Mauritius-based SPV that will issue the proposed
US-dollar bullet bond and use the proceed to subscribe to the
Indian-rupee NCDs issued by ReNew RG3.
The NCD proceeds will be used to repay the debt of the restricted
group, for capital expenditure, for distribution to shareholders
and other corporate uses as permitted under the end-use guidance.
The proposed bond benefits from a full-term guarantee by ReNew.
FINANCIAL ANALYSIS
Fitch assumes ReNew will repay the initial parent guarantor loan
and ReNew RG3 will use the repayment to partially redeem the
proposed US-dollar bond at the end of the bond maturity. Fitch
further assumes that the outstanding US-dollar bond at maturity
will be refinanced by another debt that will amortise across the
remaining PPA terms or the projects' useful life, whichever is
longer. Fitch will focus on the average annual DSCR over the
refinancing period until the end of the PPA terms for projects
contracted with state discoms and the end of the asset useful life
for projects contracted with captive/third-party off-takers, given
the bond's bullet structure. Fitch's base case assumes P50
generation, a 7% production haircut and a 13% refinancing interest
rate. It generates an average annual DSCR of 2.23x during the
refinancing period.
Fitch's rating case assumes one-year P90 generation and a 7%
production haircut. For wind projects contracted with
captive/third-party customers, Fitch assumes a tariff of
INR5.5/kwh, which is equal to the lowest price in the India Energy
Exchange in the past 10 years plus additional surcharges, after the
expiry of the existing PPAs. Fitch also applies a 15% stress on
management's operating expense forecast and a 13% refinancing
interest rate. Its rating case generates an average annual DSCR of
1.47x.
CRITERIA VARIATION
Fitch applied a variation to the Renewable Energy Project Rating
Criteria with respect to the counterparty risk related to the state
discoms and private customers. Fitch does not rate the state
discoms nor private customers that purchase power from ReNew RG3
under PPAs, but Fitch does not believe a default by one of the
companies would necessarily lead to a default of the transaction.
However, Fitch sees it prudent to apply the merchant project
threshold for the revenue from these off-takers. Therefore, Fitch
applies a revenue-based weighted-average threshold to determine the
rating, while cash flow is evaluated based on contracted prices.
ROLTAS PAPER: CRISIL Assigns B+ Rating to INR12cr Fund Based Loan
-----------------------------------------------------------------
CRISIL has assigned its 'CRISIL B+/Stable' rating to the long-term
bank facility of Roltas Paper LLP (RPL).
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Proposed Fund-
Based Bank Limits 12 CRISIL B+/Stable (Assigned)
The rating reflects RPL's exposure to project implementation risks
and to timely stabilisation and commensurate ramp-up in sales
during the initial phase of operations. The rating also factors in
an average financial risk profile. These weaknesses are partially
offset by the extensive entrepreneurial experience of the partners
in paper and ceramic industries, their funding support and
favourable repayment structure of project loan.
Key Rating Drivers & Detailed Description
Weaknesses
* Exposure to timely project implementation and stabilisation of
operations thereafter: Commercial production of kraft paper is
expected to commence from January 2021. Timely implementation, and
stabilisation and commensurate ramp-up in sales during the initial
phase of operations, remain critical, and hence will be closely
monitored.
* Average financial risk profile: Financial risk profile is likely
to remain weak owing to the ongoing debt-funded capital expenditure
is likely to result in average estimated gearing of around 1.4
times, thus impacting the financial risk profile.
Strengths
* Extensive experience and funding support of partners: Benefits
from the partners' expertise, their strong understanding of local
market dynamics, healthy relations with suppliers and customers,
and their timely, need-based funding support should continue to aid
the business.
* Favourable repayment structure of project loan: Long tenure of
the term loan with moratorium of six months may aid liquidity in
the initial years.
Liquidity Stretched
Liquidity is likely to remain stretched. Cash accrual is projected
at INR1.0-1.5 crore per fiscal over the medium term, barely
sufficient to meet the yearly debt obligation of INR1.0-1.2 crore.
However, liquidity may be supported by the long tenure of loan and
the need-based funds extended by the partners.
Outlook: Stable
CRISIL believes RPL should continue to benefit from the extensive
experience of the partners and favourable repayment structure of
project loan.
Rating Sensitivity Factors
Upward Factors
* Cash accrual increasing to more than INR1.5 crore per fiscal
* Significant ramp-up in production
Downward Factors
* Substantial overrun of 20% or more in project cost
* Major delay in commencement of operations.
RPL was set up in March 2020 by members of Dalsaniya, Moradiya and
Kanjiya families; the Dalsaniya and Moradiya families are major
stakeholders. The firm has set up a greenfield project for
manufacturing kraft paper in Morbi, Gujarat.
SAI RAMA: CRISIL Downgrades Rating on INR10cr Loans to B
--------------------------------------------------------
CRISIL has revised the ratings on bank facilities of Sai Rama Sea
Foods (SRSF) to 'CRISIL B/Stable Issuer Not Cooperating' from
'CRISIL BB/Stable Issuer Not Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 5.25 CRISIL B/Stable (ISSUER NOT
COOPERATING; Revised from
'CRISIL BB/Stable ISSUER NOT
COOPERATING')
Proposed Working 4.75 CRISIL B/Stable (ISSUER NOT
Capital Facility COOPERATING; Revised from
'CRISIL BB/Stable ISSUER NOT
COOPERATING')
CRISIL has been consistently following up with SRSF for obtaining
information through letters and emails dated March 17,2020 and
September 16,2020 among others, apart from telephonic
communication. However, the issuer has remained non cooperative.
'The investors, lenders and all other market participants should
exercise due caution with reference to the rating assigned/reviewed
with the suffix 'ISSUER NOT COOPERATING' as the rating is arrived
at without any management interaction and is based on best
available or limited or dated information on the company. Such non
co-operation by a rated entity may be a result of deterioration in
its credit risk profile. These ratings with 'ISSUER NOT
COOPERATING' suffix lack a forward looking component.'
Detailed Rationale
Despite repeated attempts to engage with the management, CRISIL
failed to receive any information on either the financial
performance or strategic intent of SRSF, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes that rating action on SRSF is consistent
with 'Assessing Information Adequacy Risk'. Based on the last
available information, the ratings on bank facilities of SRSF
Revised to 'CRISIL B/Stable Issuer Not Cooperating' from 'CRISIL
BB/Stable Issuer Not Cooperating'.
SRSF, set up in 2006 and based in Amalapuram, Andhra Pradesh, sells
raw shrimp to shrimp processing companies.
SEA BLUE: CARE Keeps D Debt Ratings in Not Cooperating Category
---------------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Sea Blue
Shipyard Limited (SBSL) continues to remain in the 'Issuer Not
Cooperating' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Bank 11.57 CARE D; Issuer not cooperating;
Facilities Based on best available
information
Long Term Bank 13.00 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(s) of SBSL under the 'issuer not cooperating' category as
SBSL had failed to provide sufficient information for monitoring of
the rating. Sea Blue Shipyard Limited continues to be
non-cooperative despite repeated requests for submission of
information through phone calls and emails dated August 28, 2020 to
September 3, 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
obligations and classification of the company's account as
NonPerforming Asset (NPA).
Detailed description of the key rating drivers
At the time of last press release dated July 23, 2019 the following
were the rating strengths and weaknesses:
Key Rating Weakness
* Delays in meeting of debt obligations: The company's account has
been classified as Non-performing Asset (NPA) by lenders during
FY2017-18.
Key Rating Strengths
* Experienced promoter in ship building industry: The promoters
have good experience in ship building and repairing industry. Mr.
OC John, Promoter and Managing Director, is a post graduate in
commerce and a graduate in law. He joined a ship building and
repairing firm in Kochi in 1983 and resigned from the firm in 2002
as Chief Executive Officer and promoted SBS in 2003 along with four
other technocrats. Mr. E Tojen, promoter and director, is a marine
engineer by profession, has 21 years of experience in shipping
industry and merchant navy. Capt Ruskin A Thomas, promoter and
director, is a master mariner, and has 20 years of experience in
this industry. Mr. Santosh Abraham, promoter and director, is a
Bachelor in Engineering, manages quality, health safety and
environmental function of an upcoming large industrial estate in
Dubai, UAE.
SBS incorporated on December 8, 2003, is promoted by Mr. OC John
and is engaged in ship building and ship repairs activities.
Initially the company was established under the name of Sea Blue
Marine Engineering (Pvt.) Ltd. and later converted into a Public
Limited Company in 2009, with its new name SBS. SBS operates from a
yard located at Vypin (Kerala) and a branch office in Goa. It
undertakes contractual work of public sector as well as private
sector agencies operating in the Western region. SBS is registered
with Indian Coast Guard for undertaking repairs of their vessels.
It provides afloat repairs of medium sized vessels and also
provides shelter to vessels during off season especially to those
vessels plying between Kochi and Lakshadweep Islands.
SHIVHARE ROAD: CRISIL Keeps B+ Debt Ratings in Not Cooperating
--------------------------------------------------------------
CRISIL said the ratings on bank facilities of Shivhare Road lines
(SRL) continue to be 'CRISIL B+/Stable/CRISIL A4 Issuer not
cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Bank Guarantee 3.5 CRISIL A4 (ISSUER NOT
COOPERATING)
Cash Credit 1 CRISIL B+/Stable (ISSUER NOT
COOPERATING)
Letter of Credit 1.5 CRISIL A4 (ISSUER NOT
COOPERATING)
Term Loan 8.8 CRISIL B+/Stable (ISSUER NOT
COOPERATING)
CRISIL has been consistently following up with SRL for obtaining
information through letters and emails dated March 17, 2020 and
September 16, 2020 among others, apart from telephonic
communication. However, the issuer has remained non cooperative.
'The investors, lenders and all other market participants should
exercise due caution with reference to the rating assigned/reviewed
with the suffix 'ISSUER NOT COOPERATING' as the rating is arrived
at without any management interaction and is based on best
available or limited or dated information on the company. Such non
co-operation by a rated entity may be a result of deterioration in
its credit risk profile. These ratings with 'ISSUER NOT
COOPERATING' suffix lack a forward looking component.'
Detailed Rationale
Despite repeated attempts to engage with the management, CRISIL
failed to receive any information on either the financial
performance or strategic intent of SRL, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes that rating action on SRL is consistent
with 'Assessing Information Adequacy Risk'. Based on the last
available information, the ratings on bank facilities of SRL
continues to be 'CRISIL B+/Stable/CRISIL A4 Issuer not
cooperating'.
SRL was incorporated in 1983 by Mr. Suresh Chand Shivhare and is
engaged in material handling and transportation. Based in Gwalior
(Madhya Pradesh), the firm primarily works for oil refineries in
government and private sector.
SPRING DYNAMICS: CRISIL Keeps B Debt Ratings in Not Cooperating
---------------------------------------------------------------
CRISIL said the ratings on bank facilities of Spring Dynamics
Private Limited (Spring Dynamics) continue to be 'CRISIL B/Stable
Issuer Not Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 1.5 CRISIL B/Stable (ISSUER NOT
COOPERATING)
Proposed Long Term 2.9 CRISIL B/Stable (ISSUER NOT
Bank Loan Facility COOPERATING)
Term Loan 1.4 CRISIL B/Stable (ISSUER NOT
COOPERATING)
CRISIL has been consistently following up with Spring Dynamics for
obtaining information through letters and emails dated March 17,
2020 and September 16, 2020 among others, apart from telephonic
communication. However, the issuer has remained non cooperative.
'The investors, lenders and all other market participants should
exercise due caution with reference to the rating assigned/reviewed
with the suffix 'ISSUER NOT COOPERATING' as the rating is arrived
at without any management interaction and is based on best
available or limited or dated information on the company. Such non
co-operation by a rated entity may be a result of deterioration in
its credit risk profile. These ratings with 'ISSUER NOT
COOPERATING' suffix lack a forward looking component.'
Detailed Rationale
Despite repeated attempts to engage with the management, CRISIL
failed to receive any information on either the financial
performance or strategic intent of Spring Dynamics, which restricts
CRISIL's ability to take a forward looking view on the entity's
credit quality. CRISIL believes that rating action on Spring
Dynamics is consistent with 'Assessing Information Adequacy Risk'.
Based on the last available information, the ratings on bank
facilities of Spring Dynamics continues to be 'CRISIL B/Stable
Issuer Not Cooperating'.
Spring Dynamics was incorporated in July 2013 and is promoted Mr.
B. V. Srinivas Prasad, Mr. Guruprasad and Mr. Srinath. The company
is engaged in the manufacturing of automobile and industrial
springs and has its facility at Bengaluru.
SUBRA INTERNATIONAL: CRISIL Cuts Rating on INR24cr Loan to B
------------------------------------------------------------
CRISIL has revised the ratings on bank facilities of Subra
International Private Limited (SIPL) to 'CRISIL B/Stable Issuer Not
Cooperating' from 'CRISIL BB-/Stable Issuer Not Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Proposed Long Term 24 CRISIL B/Stable (ISSUER NOT
Bank Loan Facility COOPERATING; Revised from
'CRISIL BB-/Stable ISSUER
NOT COOPERATING')
CRISIL has been consistently following up with SIPL for obtaining
information through letters and emails dated March 17, 2020 and
September 16, 2020 among others, apart from telephonic
communication. However, the issuer has remained non cooperative.
'The investors, lenders and all other market participants should
exercise due caution with reference to the rating assigned/reviewed
with the suffix 'ISSUER NOT COOPERATING' as the rating is arrived
at without any management interaction and is based on best
available or limited or dated information on the company. Such non
co-operation by a rated entity may be a result of deterioration in
its credit risk profile. These ratings with 'ISSUER NOT
COOPERATING' suffix lack a forward looking component.'
Detailed Rationale
Despite repeated attempts to engage with the management, CRISIL
failed to receive any information on either the financial
performance or strategic intent of SIPL, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes that rating action on SIPL is consistent
with 'Assessing Information Adequacy Risk'. Based on the last
available information, the ratings on bank facilities of SIPL
Revised to 'CRISIL B/Stable Issuer Not Cooperating' from 'CRISIL
BB-/Stable Issuer Not Cooperating'.
SIPL was set up in 1994 as a proprietorship concern by Mr.
Maninder. It was later in 2011 converted into a private limited
company. The company is engaged in selling of handmade gold
jewellery.
SUMANGAL POLYMERS: CRISIL Lowers Rating on INR15cr Loan to B
------------------------------------------------------------
CRISIL has revised the ratings on bank facilities of Sumangal
Polymers (A-Division of Shree Sumangal India Private Limited) (SP)
to 'CRISIL B/Stable/CRISIL A4 Issuer Not Cooperating' from 'CRISIL
BB+/Stable/CRISIL A4+ Issuer Not Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 10 CRISIL B/Stable (ISSUER NOT
COOPERATING; Revised from
'CRISIL BB+/Stable ISSUER NOT
COOPERATING')
Electronic Dealer 15 CRISIL B/Stable (ISSUER NOT
Financing Scheme COOPERATING; Revised from
(e-DFS) 'CRISIL BB+/Stable ISSUER NOT
COOPERATING')
Letter of Credit 10 CRISIL A4 (ISSUER NOT
COOPERATING; Revised from
'CRISIL A4+ ISSUER NOT
COOPERATING')
CRISIL has been consistently following up with SP for obtaining
information through letters and emails dated March 17,2020 and
September 16,2020 among others, apart from telephonic
communication. However, the issuer has remained non cooperative.
'The investors, lenders and all other market participants should
exercise due caution with reference to the rating assigned/reviewed
with the suffix 'ISSUER NOT COOPERATING' as the rating is arrived
at without any management interaction and is based on best
available or limited or dated information on the company. Such non
co-operation by a rated entity may be a result of deterioration in
its credit risk profile. These ratings with 'ISSUER NOT
COOPERATING' suffix lack a forward looking component.'
Detailed Rationale
Despite repeated attempts to engage with the management, CRISIL
failed to receive any information on either the financial
performance or strategic intent of SP, which restricts CRISIL's
ability to take a forward looking view on the entity's credit
quality. CRISIL believes that rating action on SP is consistent
with 'Assessing Information Adequacy Risk'. Based on the last
available information, the ratings on bank facilities of SP revised
to 'CRISIL B/Stable/CRISIL A4 Issuer Not Cooperating' from 'CRISIL
BB+/Stable/CRISIL A4+ Issuer Not Cooperating'.
Shree Sumangal India Pvt. Ltd., incorporated on June 8, 2005, is
promoted by the Parekh family. SP is engaged in trading and
distribution of polymers. It operates as a del credere agent for
CSL. In addition, it imports polymers from the US, the Middle East,
France, and other countries.
=================
I N D O N E S I A
=================
MODERNLAND REALTY: S&P Downgrades Issuer Credit Rating to 'D'
-------------------------------------------------------------
On Oct. 15, 2020, S&P Global Ratings lowered both its issuer credit
ratings on Indonesia-based property developer PT Modernland Realty
Tbk. and the issue rating on the company's guaranteed 2024 senior
unsecured notes to 'D'.
S&P said, "The downgrade reflects our view that Modernland will not
make the coupon payment on its US$240 million senior unsecured
notes due 2024 within the stated grace period of 30 days. This
comes after the company missed the coupon payment on its 2021 notes
of about US$8 million on Aug. 30, 2020. We lowered the issuer
credit rating to 'D' from 'SD' because the company remains in
default for both its rated debt obligations. Together, the two
notes account for over 95% of Modernland's total outstanding debt
as of March 31, 2020.
"In our view, Modernland is likely to restructure both its
U.S.-dollar-denominated debts. The company initiated restructuring
talks with its bondholders on Aug. 12, 2020, and Sept. 25, 2020. We
believe a restructuring plan could materialize over the next few
months."
Meanwhile, Modernland is likely to file for moratorium on its 2024
notes to avoid creditors' claim, similar to the action taken for
the 2021 notes. On Sept. 29, 2020, Modernland filed for moratorium
in the Singapore High Court on its US$150 million notes due 2021.
The moratorium application provided an automatic 30-day protection
to restrict creditor action. This includes restraining the
bondholders from triggering the cross-acceleration clause to the
2024 notes. The company's bond indenture states that early
repayment of the 2024 notes will happen if bondholders constituting
at least 25% of outstanding notes call for an acceleration.
Modernland's court hearing is set on Oct. 29, 2020, when the 30-day
protection period ends.
The ratings will be reviewed once S&P has further clarity on the
restructuring outcome.
Modernland primarily engages in residential and industrial township
development in the suburbs of Jakarta. Its major projects include
Jakarta Garden City, Modern Cikande, and Modern Bekasi.
===============
M A L A Y S I A
===============
AIRASIA GROUP: Unit to Liquidate Indonesia Operations Amid Woes
---------------------------------------------------------------
Anisah Shukry at Bloomberg News reports that AirAsia X Bhd. is
liquidating its Indonesian arm in a bid to survive the virus
pandemic that has left the low-cost airline's planes grounded since
late March.
The long-haul arm of AirAsia Group Bhd. has also written down its
49% stake in Thai AirAsia X, the airline's deputy chairman Lim Kian
Onn said in an interview with the Star newspaper, Bloomberg
relays.
These efforts come amid AirAsia X's proposed restructuring plan to
wipe out almost MYR63.5 billion (US$15.3 billion) in debt and save
it from collapse, according to Bloomberg. The proposal requires
approval from investors and creditors.
Initial negotiations with creditors have been tough as they are
understandably upset, Mr. Lim said in the interview. They had asked
for better terms, including free equity for forgiven debt --
something that would be impossible for the airline to fulfill, he
added, the report relays.
Still, Mr. Lim said all of them genuinely wanted to find a common
ground to take the airline forward. "No one has anything to gain
from our demise," he told the newspaper.
The airline is planning to resume flights in the first quarter,
though the process remains "dynamic," said Mr. Lim. Should the
rescue plan get approval, the company will have to renegotiate
every single contract and will do its best to look after all
stakeholders' interests, he said, Bloomberg adds.
About AirAsia
AirAsia Berhad provides low-cost air carrier service. The company
provides services on short-haul, point-to-point domestic and
international routes. AirAsia, headquartered in Malaysia, operates
from hubs in Malaysia, Thailand, Indonesia, Philippines and India.
As reported in the Troubled Company Reporter-Asia Pacific on July
9, 2020, auditor Ernst & Young said the carrier's ability to
continue as a going concern may be in "significant doubt." In a
statement to the Kuala Lumpur stock exchange, Ernst & Young said
AirAsia's current liabilities already exceeded its current assets
by MYR1.84 billion at the end of 2019, a year when it posted a
MYR283 million net loss, Bloomberg News disclosed. That was before
the coronavirus crisis, which has further hit the carrier's
financial performance and cash flow.
MALAYSIA AIRLINES: Restructuring Talks Prolonged, CEO Tells Staff
-----------------------------------------------------------------
Reuters reports that Malaysia Airlines' parent company is still
holding negotiations with lessors and creditors over a
restructuring plan to keep the carrier alive, but the talks are
taking longer than planned, according to a staff memo seen by
Reuters.
"The negotiations are still ongoing and taking longer than the
planned timeline, but we are gaining encouraging traction from the
lessors and creditors thus far," Reuters quotes Izham Ismail, chief
executive of Malaysia Airlines and group CEO of parent Malaysia
Aviation Group (MAG), as saying in a memo to staff on Oct. 16.
In response to a Reuters query, MAG said in an email on Oct. 17 it
is "continuing discussions with creditors on its ongoing
restructuring exercise".
Reuters relates that MAG, owned by state fund Khazanah, said
Izham's memo to staff was to address concerns among employees.
Malaysia's national airline is seeking to restructure after the
coronavirus pandemic forced it to slash operations, Reuters notes.
The carrier had restructured after two deadly crashes in 2014 but
unlike at that time the government is unwilling to bail it out this
time.
Reuters reported two weeks ago that a group of lessors had rejected
a restructuring plan that involved steep discounts, bringing the
carrier closer to a showdown over its future.
In the memo to staff, Izham assured them that MAG's restructuring
exercise "is still work in progress".
"Do you see me throwing in the towel yet? Together with the senior
leadership team, we are here still fighting for the company's
survival," Izham said.
On Oct. 15, MAG said subsidiary Firefly Airlines will start flying
in early 2021 as part of a realigned group-wide business strategy,
Reuters adds.
Reuters reported two weeks ago that MAG had warned lessors that its
sole shareholder would wind down the airline if restructuring talks
are unsuccessful, and would focus on Firefly.
About Malaysia Airlines
Headquartered in Selangor, Malaysia, state-owned Malaysia Airlines
-- http://www.malaysiaairlines.com/-- engages in the business of
air transportation and the provision of related services.
As reported in the Troubled Company Reporter-Asia Pacific on March
19, 2020, The Malaysian Reserve said that Malaysia Airlines Bhd
(MAB) is at risk of bankruptcy and staff are encouraged to take the
voluntary unpaid leave programme, said the group CFO Boo Hui Yee in
an internal memo addressed to the airline's 13,000 staff.
Khazanah is the sole shareholder of MAB after taking the airline
private in 2014. The sovereign wealth fund injected MYR6 billion
into the airline to keep it afloat.
From its delisting from Bursa Malaysia from 2015 to 2017, MAB had
registered a loss of MYR2.3 billion due to the ringgit's weakness
and higher jet fuel costs.
According to Reuters, the Malaysian government has been seeking a
strategic partner for its national airline, which has struggled to
recover from two tragedies - the mysterious disappearance of flight
MH370 and the shooting down of flight MH17 over eastern Ukraine.
=================
S I N G A P O R E
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KRISENERGY: Court to Hear Bid to Convene Scheme Meeting on Oct. 30
------------------------------------------------------------------
The Business Times reports that KrisEnergy Ltd has applied for
permission to convene a meeting of the scheme creditors as well as
an extension to its debt moratorium for two months, the upstream
oil and gas company said in a regulatory filing on Oct. 16.
According to BT, the High Court will hear these applications on
Oct. 30, and has directed that whoever objects to these requests is
to file an affidavit by Oct. 22, 4:00 p.m.
BT relates that KrisEnergy said that the meeting of the scheme
creditors will allow only those scheme creditors in a contractual
relationship with the company to vote by appointing the chairman of
the meeting.
The Central Depository (CDP) account holders who invested in the
S$130,000,000 senior unsecured notes due 2022 and the S$200,000,000
senior unsecured notes due 2023 will also be entitled to nominate
the chairman for the purposes of voting at the meeting, the report
says.
BT notes that KrisEnergy has proposed a debt-to-equity swap to
settle its liabilities, with the shareholding structure post
restructuring to see unsecured creditors owning 46.2% and the zero
coupon note holders holding 43.8 per cent.
Also, the company is seeking a fifth extension to its debt
moratorium, which was first granted in September last year and was
last extended to Oct. 27, the report adds.
About KrisEnergy
KrisEnergy Limited -- https://krisenergy.com/ -- is a
Singapore-based investment holding company. The Company is an
independent upstream oil and gas company with a portfolio of
exploration, appraisal, development and production assets focused
on the geological basins in Asia. The Company operates through
exploration and production of oil and gas in Asia segment. The
Company holds interests in approximately 20 licenses in Bangladesh,
Cambodia, Indonesia, Thailand and Vietnam covering a gross acreage
of approximately 60,750 square kilometers.
In August 2019, the firm sought court protection from creditors'
legal action while it restructured its debts, according to The
Business Times. Keppel Corporation, a creditor and shareholder of
KrisEnergy, then publicly came out to support the application and
KrisEnergy's management in formulating a restructuring plan.
Trading in its shares has been suspended pending the restructuring,
BT noted.
Total debts stood at around US$558.8 million as at June 30, 2019,
according to KrisEnergy's presentation slides for its Sept. 10,
2019, informal investor meeting for noteholders and shareholders.
NEW SILKROUTES: Goh Jin Hian Steps Down as Chairman
---------------------------------------------------
The Business Times reports that New Silkroutes Group has announced
that non-independent, non-executive chairman Goh Jin Hian and
finance director William Teo Thiam Chuan have resigned.
At the same time, Dr Goh has also quit as independent director of
cord-blood banking firm Cordlife Group with immediate effect, the
report discloses.
According to BT, New Silkroutes said on Oct. 15 that Dr. Goh
stepped down as its chairman to "focus on personal matters and to
pursue other interests".
Mr. Teo, meanwhile, stepped down "to devote more time to his
personal affairs", it added.
BT relates that the resignations of the two New Silkroutes
directors also came after the firm announced on Oct. 15 that its
auditor Deloitte & Touche has given a disclaimer of opinion on the
financial statements of the group for the financial year ended June
30.
Dr. Goh, the medically-trained son of former Singapore prime
minister Goh Chok Tong, was New Silkroutes' chief executive officer
till Oct. 1, when he assumed the position of non-executive
chairman.
He also quit as Cordlife's chairman, after Inter-Pacific
Petroleum's (IPP) judicial managers sued him in relation to an
alleged breach of director's duties, BT recalls.
At the time, he had remained as an independent director because the
cessation of his role as chairman would allow him to give
sufficient time and attention to the company's affairs as an
independent director, said Cordlife, the report relays.
On Oct. 15, Cordlife said Dr. Goh was leaving the board "to devote
more time to his personal affairs".
BT says New Silkroutes earlier disclosed that Dr. Goh and Mr. Teo
were assisting the Commercial Affairs Department with
investigations. The company said it understands that the alleged
offence is false trading and market rigging pursuant to Section 197
of the Securities and Futures Act in view of past share buybacks
and acquisitions of shares.
Also assisting with the investigation is Kelvyn Oo, who was the
executive director and chief corporate officer of New Silkroutes
until he left on Aug. 1, the report relates.
According to BT, New Silkroutes had separately said two weeks ago
that Dr. Goh was suitable to continue as a board member despite the
IPP litigation, because that is a civil suit against him and the
allegations are without merit, based on his lawyers' legal advice.
About New Silkroutes
Based in Singapore, New Silkroutes Group Limited (SGX:BMT) --
http://www.newsilkroutes.org/-- is an investment holding company
focused on healthcare and energy. The Company owns and operates
primary care medical and dental facilities in Singapore and
Vietnam, as well as pharmacy management systems in Singapore and
China. New Silkroutes's energy division is involved in physical oil
trades in SEA and North Asia.
*********
S U B S C R I P T I O N I N F O R M A T I O N
Troubled Company Reporter-Asia Pacific is a daily newsletter co-
published by Bankruptcy Creditors' Service, Inc., Fairless Hills,
Pennsylvania, USA, and Beard Group, Inc., Washington, D.C., USA.
Marites O. Claro, Joy A. Agravante, Rousel Elaine T. Fernandez,
Julie Anne L. Toledo, Ivy B. Magdadaro and Peter A. Chapman,
Editors.
Copyright 2020. All rights reserved. ISSN: 1520-9482.
This material is copyrighted and any commercial use, resale or
publication in any form (including e-mail forwarding,
electronic re-mailing and photocopying) is strictly prohibited
without prior written permission of the publishers.
Information contained herein is obtained from sources believed
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TCR-AP subscription rate is US$775 for 6 months delivered via e-
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firm for the term of the initial subscription or balance
thereof are US$25 each. For subscription information, contact
Peter Chapman at 215-945-7000.
*** End of Transmission ***