/raid1/www/Hosts/bankrupt/TCRAP_Public/220715.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
A S I A P A C I F I C
Friday, July 15, 2022, Vol. 25, No. 135
Headlines
A U S T R A L I A
A. NOBLE: Second Creditors' Meeting Set for July 20
AUTOMATION POOL: Second Creditors' Meeting Set for July 21
EMERALD REFRIGERATED: First Creditors' Meeting Set for July 15
GREENPLAY AUSTRALIA: Second Creditors' Meeting Set for July 20
SIRIUS FINANCIAL: Surrenders License; Former Execs Banned for 8 Yrs
SNOWDON DEVELOPMENTS: Bought Out by Victorian Builder Mimosa Homes
SODA SHADES: Enters Voluntary Administration
ZIGAROO PTY: First Creditors' Meeting Set for July 21
C H I N A
CENTRAL CHINA REAL: Fitch Cuts FC IDR to 'B', Put on Watch Neg.
GUANGZHOU R&F: Creditors OK Regroup of 10 Offshore Bonds
HO WAN KWOK: Court Approves Appointment of Luc Despins as Trustee
INNER MONGOLIA BAOTOU: Fitch Affirms FC IDR at BB+, Outlook Stable
REMARK HOLDINGS: Holds Annual Stockholders' Meeting
SANSHENG HOLDINGS: Moody's Withdraws 'Ca' Corporate Family Rating
STX DALIAN: Chinese Shipyard Sold Decade After Financial Collapse
I N D I A
ACEBRIGHT PHARMA: Ind-Ra Cuts Long-Term Issuer Rating to 'BB'
AMKO EXPORTS: CRISIL Withdraws B Rating on INR1.12cr Term Loan
ANGEL BABY: Ind-Ra Assigns BB+ LT Issuer Rating, Outlook Stable
APSARA POWER: CRISIL Assigns B+ Rating to INR12cr Term Loan
ASIAN HOTELS: Ind-Ra Moves 'D' LT Issuer Rating to Non-Cooperating
ATHAVAN SOLAR: CRISIL Assigns B+ Rating to INR13.5cr Term Loan
BENGAL EMTA: Insolvency Resolution Process Case Summary
BINDAL FASHION: Insolvency Resolution Process Case Summary
BLDEU: Ind-Ra Downgrades Long-Term Issuer Rating to 'BB'
BOLA RAGHAVENDRA: CRISIL Raises Rating on INR75cr Loan to B+
CHOKSEY CHEMICALS: CRISIL Hikes Rating on INR8cr Cash Loan to B+
CITRON ECOPOWER: Ind-Ra Affirms 'B' Loan Rating, Outlook Stable
CLASSIC PROMOTERS: Ind-Ra Cuts Loan Rating to B-, Outlook Negative
DOLPHIN PROMOTERS: CRISIL Cuts Rating on INR19cr LT Loan to D
DOSHION WATER: Insolvency Resolution Process Case Summary
ELYSIUM PHARMACEUTICALS: Ind-Ra Hikes LT Issuer Rating to 'BB+'
FATEH CHAND: Ind-Ra Moves BB+ Bank Loan Rating in Non-Cooperating
FUTURE LIFESTYLE: CRISIL Reaffirms D Rating on INR500cr NCD
GANPATI AGRI: Ind-Ra Affirms BB+ LT Issuer Rating, Outlook Stable
GINNI FILAMENTS: CRISIL Withdraws B+ Rating on INR18.18cr Loan
GONGLU AGRO: Insolvency Resolution Process Case Summary
INCI CONSTRUCTION: CRISIL Lowers Rating on Long Term Debt to D
J M J CHARITABLE: Ind-Ra Moves 'BB' Loan Rating to Non-Cooperating
JAMES & CO: Ind-Ra Moves BB- LT Issuer Rating to Non-Cooperating
JAMES RETAIL: Ind-Ra Moves BB- LT Issuer Rating to Non-Cooperating
JANA CAPITAL: Ind-Ra Affirms 'B+' Non-Convertible Debt Rating
KAMAL AND COMPANY: CRISIL Moves B Debt Rating to Not Cooperating
KASHIPUR INFRASTRUCTURE: Ind-Ra Keeps BB Rating in Non-Cooperating
KLSR INFRATECH: Ind-Ra Downgrades Bank Loan Rating to 'B+'
KSM EDUCATIONAL: Ind-Ra Keeps 'D' Loan Rating in Non-Cooperating
LEO ENTERPRISES: Ind-Ra Moves B+ Issuer Rating to Non-Cooperating
MAAN SAROVAR: Insolvency Resolution Process Case Summary
MAHANADI EDUCATION: Ind-Ra Keeps BB Loan Rating in Non-Cooperating
MAHARANA CHAINS: CRISIL Reaffirms B+ Rating on INR12cr Cash Loan
MANIPAL ENERGY: Ind-Ra Hikes Long-Term Issuer Rating to 'BB+'
MANIPAL MEDIA: Ind-Ra Affirms BB+ Issuer Rating, Outlook Positive
MARIGOLD TRUST: Ind-Ra Gives 'B' Bank Loan Rating, Outlook Stable
NAV DURGA: CRISIL Keeps D Debt Ratings in Not Cooperating
NEXUS HEALTH: Insolvency Resolution Process Case Summary
ORANGE MEGASTRUCTURE: CRISIL Withdraws B+ Rating on INR100cr Loan
ORISSA STATE: Ind-Ra Keeps BB Bank Loan Rating in Non-Cooperating
OSL AUTOMOTIVES: CRISIL Reaffirms B+ Rating on INR8.75cr Loan
PLANET MOBILES: Insolvency Resolution Process Case Summary
POLYOLEFIN SACKS: Ind-Ra Affirms BB+ Issuer Rating, Outlook Stable
PRAGATI GRANITO: CRISIL Reaffirms B+ Rating on INR6.0cr Loans
RAMANI TIMBER: Ind-Ra Affirms B- LT Issuer Rating, Outlook Stable
RARE ROCKS: CRISIL Reaffirms B+ Rating on INR4.75cr Cash Credit
RAVINDRA BHARATHI: Ind-Ra Keeps 'D' Loan Rating in Non-Cooperating
ROBIN POWER: Ind-Ra Assigns BB LT Issuer Rating, Outlook Stable
S. A. IRON: CRISIL Lowers Rating on INR20cr Term Loan to D
SARAF TRADING: Ind-Ra Affirms B+ LT Issuer Rating, Outlook Stable
SAVI LEATHERS: Ind-Ra Hikes LT Issuer Rating to B+, Outlook Stable
SHIV METTALICKS: Ind-Ra Hikes Long-Term Issuer Rating to 'BB'
SHIVAM WOOD: Ind-Ra Cuts LT Issuer Rating to 'B', Outlook Stable
SHIVANI LOCKS: CRISIL Withdraws B+ Rating on INR25cr Term Loan
SIR BIOTECH: Ind-Ra Keeps 'D' LT Issuer Rating in Non-Cooperating
SOUMAK FLOATING: CRISIL Assigns B Rating to INR9.90cr Term Loan
SPAHJ INDIA: CRISIL Assigns B Rating to INR20cr Proposed Loan
SPICEJET LTD: Has Problems Over and Above INR10.29BB in Losses
SUBIR DIAMONDS: Ind-Ra Moves 'B' Issuer Rating to Non-Cooperating
SWARGIYA BHIKAM: Ind-Ra Keeps BB Loan Rating in Non-Cooperating
UNITED TECHFAB: CRISIL Lowers Rating on INR23.35cr Term Loan to B
UTHARA FASHION: Insolvency Resolution Process Case Summary
VANILLA CLEAN: Ind-Ra Affirms B+ LT Issuer Rating, Outlook Stable
VISHAL CONSTRUCTION: CRISIL Moves B Rating to Not Cooperating
I N D O N E S I A
SAWIT SUMBERMAS: S&P Downgrades ICR to 'CC', Outlook Negative
J A P A N
JPA NO. 111: Unsecureds Unimpaired Under Joint Chap. 11 Plan
M A L A Y S I A
1MDB: Court Sets Aug 4 for Decision on bid to Get Docs from Aziz
N E W Z E A L A N D
FITLINK NEW ZEALAND: Creditors' Proofs of Debt Due on Aug. 4
LAMBERT'S LUSCIOUS: Court to Hear Wind-Up Petition on July 26
PORANA ROOFING: Court to Hear Wind-Up Petition on July 26
SAVCON 2016: Court to Hear Wind-Up Petition on July 26
TTIGR LIMITED: Court to Hear Wind-Up Petition on July 26
P H I L I P P I N E S
BANCO RURAL DE GENERAL: Creditors' Claims Deadline Set for Aug. 22
S I N G A P O R E
BMF BUSINESS: Court Enters Wind-Up Order
NEM.IO FOUNDATION: Creditors' Proofs of Debt Due on Aug. 13
S R I L A N K A
SRI LANKA: Rajapaksa Has Yet to Resign, Whereabouts Unknown
- - - - -
=================
A U S T R A L I A
=================
A. NOBLE: Second Creditors' Meeting Set for July 20
---------------------------------------------------
A second meeting of creditors in the proceedings of A. Noble & Sons
Limited has been set for July 20, 2022, at 11:00 a.m. via
teleconference.
The purpose of the meeting is (1) to receive the report by the
Administrator about the business, property, affairs and financial
circumstances of the Company; and (2) for the creditors of the
Company to resolve whether the Company will execute a deed of
company arrangement, the administration should end, or the Company
be wound up.
Creditors wishing to attend are advised proofs and proxies should
be submitted to the Administrator by July 18, 2022, at 4:00 p.m.
Austin R M Taylor and James S McPherson of Meertens were appointed
as administrators of the company on June 15, 2022.
AUTOMATION POOL: Second Creditors' Meeting Set for July 21
----------------------------------------------------------
A second meeting of creditors in the proceedings of Automation Pool
Shops Pty Ltd has been set for July 21, 2022, at 11:00 a.m. via
virtual meeting technology.
The purpose of the meeting is (1) to receive the report by the
Administrator about the business, property, affairs and financial
circumstances of the Company; and (2) for the creditors of the
Company to resolve whether the Company will execute a deed of
company arrangement, the administration should end, or the Company
be wound up.
Creditors wishing to attend are advised proofs and proxies should
be submitted to the Administrator by July 20, 2022, at 4:00 p.m.
Glenn Livingstone and Scott Pascoe of WLP Restructuring were
appointed as administrators of the company on June 16, 2022.
EMERALD REFRIGERATED: First Creditors' Meeting Set for July 15
--------------------------------------------------------------
A first meeting of the creditors in the proceedings of Emerald
Refrigerated Logistics Pty Ltd will be held on July 15, 2022, at
11:00 a.m. at the offices of Chartered Accountants Australia and
New Zealand at Level 13/1 Eagle Street, Brisbane QLD 4000 and via
virtual facilities.
Bradd William Morelli and Gavin Moss of Jirsch Sutherland were
appointed as administrators of the company on July 5, 2022.
GREENPLAY AUSTRALIA: Second Creditors' Meeting Set for July 20
--------------------------------------------------------------
A second meeting of creditors in the proceedings of Greenplay
Australia Pty Ltd has been set for July 20, 2022, at 2:30 p.m. at
Aurora SkyDeck at Level 13, 147 Pirie Street, in Adelaide, South
Australia and by Zoom and telephone.
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 June 19, 2022, at 5:00 p.m.
Dominic Charles Cantone of Oracle Insolvency Services was appointed
as administrator of the company on June 15, 2022.
SIRIUS FINANCIAL: Surrenders License; Former Execs Banned for 8 Yrs
-------------------------------------------------------------------
Following an Australian Securities and Investments Commission
(ASIC) investigation, over-the-counter (OTC) derivatives provider
Sirius Financial Markets Pty Ltd, trading as 'Trade360', has
surrendered its Australian Financial Services licence.
ASIC has also banned two of Sirius Financial's former executives,
Mr. Jonathan Schneider and Mr. Oskar Pecyna, from controlling an
entity that carries on a financial services business or performing
any executive or management role in relation to a financial
services business for eight years.
ASIC Commissioner Danielle Press said, 'ASIC's investigation
uncovered concerning consumer losses from trading in CFDs,
including a Sirius Financial investor, who had limited knowledge of
the market, losing over AUD400,000 after being told CFDs were a
safe investment.'
Sirius Financial engaged an off-shore call centre, Toyga Media Ltd
(Toyga), to source clients to trade in high-risk
contracts-for-difference (CFDs) and margin foreign exchange
contracts products issued by Sirius Financial. ASIC's investigation
found the call centre representatives persuaded Sirius Financial
clients to trade using pressure selling tactics and provided
clients with personal advice when Sirius Financial was not licenced
to do so. Sirius Financial was also found to have engaged in
unconscionable conduct and conduct that was likely to mislead or
deceive.
ASIC's investigation also found that, in failing to take adequate
steps to address Toyga's conduct, Sirius Financial has breached its
licence obligations to:
* do all things necessary to ensure that the financial services
covered by the licence are provided efficiently, honestly and
fairly;
* take reasonable steps to ensure that its representatives
comply with the financial services laws; and
* have in place adequate arrangements for the management of
conflicts of interest.
In banning Mr. Pecyna and Mr. Schneider, ASIC found both men were
involved in Sirius Financial's breaches of its licence obligations
and were not adequately trained or competent to be involved in the
control of a financial services business. In reaching these
findings, ASIC found that both men failed to adequately perform
their duties as responsible managers and lacked the necessary
professionalism, integrity, judgement and diligence to play a role
in the management or control of a financial services provider.
Also following ASIC's investigation, Sirius Financial will
surrender its licence and wind down retail and wholesale operations
and will cease providing financial services on July 29, 2022.
Mr. Pecyna's and Mr. Schneider's banning is recorded on ASIC's
Banned and Disqualified Persons Register.
ASIC has taken previous action against OTC derivates providers,
which has resulted in penalties handed down by the Federal Court.
AGM Markets was ordered to pay a AUD75 million penalty and Forex CT
ordered to pay a AUD20 million penalty for various breaches of the
Corporations Act, including unconscionable conduct.
SNOWDON DEVELOPMENTS: Bought Out by Victorian Builder Mimosa Homes
------------------------------------------------------------------
News.com.au reports that a collapsed building firm has been saved
less than 24 hours after going bust after another construction
company bought them out.
On July 13, news.com.au reported that the Victorian Supreme Court
had ordered builder Snowdon Developments to go into liquidation.
However, just a few hours later, the company was purchased by
another Victorian construction company, Mimosa Homes.
The move impacts 52 staff members, 550 homes and more than 250
creditors owed just under AUD18 million.
According to the report, liquidators informed customers late on
July 13 that "one of Victoria's top 15 residential builders that
has the financial backing with many years of experience in
construction and business, has acquired some of the assets owned by
the company, including any owned master plans, copyright materials,
branding and customer database".
This company has since emerged to be Mimosa Homes, news.com.au
notes.
Customers were alarmed by a few additional sentences in the email
they received about the acquisition, however.
"They [Mimosa Homes] may be in contact with you in the next seven
business days to discuss your options moving forward," it read.
"They may be able to assist with providing quotations for
completion and your claims with your Domestic Building Insurer, or
if your works have not commenced, may be able to assist in the
completion of your works . . . Accordingly, it would be prudent to
contact them to discuss any copyright and other issues that may
affect your building."
Creditors are concerned about what this means for them - especially
as they have yet to receive correspondence from liquidators about
it, news.com.au says.
Snowdon Developments entered a creditor's voluntary administration
on July 1. Shane Deane and Nicholas Giasoumi of Dye & Co, Solvency
and Turnaround, were appointed as administrators.
SODA SHADES: Enters Voluntary Administration
--------------------------------------------
SmartCompany reports that Soda Shades, the buzzy eyewear label once
part-owned by entrepreneur Steph Claire Smith and husband Josh
Miller, has entered voluntary administration.
In a statement released on July 14, KordaMentha Restructuring
confirmed the brand had secured its services to oversee the
restructuring process, SmartCompany says.
SmartCompany relates that the brand, which reportedly boasted more
than 5,000 customer expressions of interest before its 2018 launch,
has become another victim of supply chain disruptions, said Rahul
Goyal, one of two voluntary administrators now overseeing the
brand.
According to SmartCompany, Mr. Goyal voiced his hopes of selling
Soda Shades as a going concern, with core stock, incoming items,
and marketing material available for use by the brand's new owner.
Also included in the sale is Soda Shades' considerable social media
profile.
The brand currently counts almost 50,000 followers on the platform,
with its last post arriving on June 24 this year.
The brand's website is currently in password-only mode, although a
number of models are still available for sale on The Iconic, the
report notes.
Any company hoping to acquire Soda Shades would be able to take
advantage of sales in the lead-up to the Australian summer,
KordaMentha Restructuring said, reflecting an appetite to find a
new buyer in the very near future, SmartCompany relays.
"We expect there will be a high level of interest in purchasing
such a fresh label. We have quality stock on hand, marketing ready
to roll out, and a significant social media following,"
SmartCompany quotes Mr. Goyal as saying.
"This is a great opportunity for any interested buyer," he added.
Steph Claire Smith, known for her co-leadership of health and
wellness brand Keep It Cleaner, and Mr. Miller stepped away from
the Soda Shades brand in late 2021 after the birth of their child
Harvey.
"We felt it was time to step away and keep more time aside for our
little man," she said at the time, SmartCompany relays.
ZIGAROO PTY: First Creditors' Meeting Set for July 21
-----------------------------------------------------
A first meeting of the creditors in the proceedings of Zigaroo Pty
Ltd will be held on July 21, 2022, at 11:00 a.m. at the offices of
SV Partners Melbourne at Level 17, 200 Queen Street, in Melbourne
Victoria and by way of teleconference facilities.
Michael Carrafa and Fabian Kane Micheletto of SV Partners were
appointed as administrators of the company on July 11, 2022.
=========
C H I N A
=========
CENTRAL CHINA REAL: Fitch Cuts FC IDR to 'B', Put on Watch Neg.
---------------------------------------------------------------
Fitch Ratings has downgraded the Chinese homebuilder Central China
Real Estate Limited's (CCRE) Long-Term Foreign-Currency Issuer
Default Rating (IDR) to 'B' from 'B+', and the senior unsecured
rating and the ratings on CCRE's outstanding US dollar senior notes
to 'B' from 'B+' with Recovery Rating of 'RR4'. Fitch has also put
all the ratings on Rating Watch Negative (RWN).
The downgrade reflects CCRE's tight liquidity and weak contracted
sales in 1H22. Fitch believes that CCRE is likely to repay the
USD500 million bonds due in August 2022 using proceeds from recent
asset disposals and cash from operations. The RWN is due to
uncertainties about the repayment of the US dollar bonds and
completion of the proposed equity transaction.
KEY RATING DRIVERS
Tight Liquidity: Fitch expects CCRE's liquidity position to remain
tight on weak contracted sales in 1H22. Its unrestricted cash of
CNY5.9 billion as of end-2021 appears sufficient to cover the
USD500 million offshore bonds due in August 2022 and CNY1.2 billion
trust loans maturing in 2022. The company has not provided its
latest cash balance to Fitch, as it is in the process of an interim
review.
Proposed Share and CB Sale: Fitch expects the equity stake sale by
the CCRE chairman to Henan Railway Construction & Investment Group
Co., Ltd. to be completed soon, although timing uncertainties
remain. CCRE announced on June 1 the proposed sale of a 29% equity
stake from its chairman to a Henan Railway Construction wholly
owned subsidiary.
The share sale consideration of HKD688 million will be provided to
CCRE as a shareholder loan. CCRE will also issue HKD708 million
convertible bonds (CB) at 5% a year maturing in 24 months (which
may be extended for another 12 months), with a conversion price of
not higher than HKD1.20, to the same entity. CCRE said on 30 June
that the negotiation and due diligence were at an advance stage.
Weak Contracted Sales: Fitch expects CCRE's full-year contracted
sales to drop by 30% to around CNY42 billion in 2022, a similar
decline to Fitch's expectation for China's overall property market.
CCRE's contracted sales in 1H22 fell by 55% yoy to CNY14 billion,
broadly in line with the sector.
Leading Position in Henan: Fitch believes CCRE's concentration in
Henan may enable the company to obtain some support from the Henan
government. CCRE has maintained a leading market position in Henan
with a market share of about 7% for heavy asset sales in 2021. It
has been developing residential properties almost entirely in Henan
for nearly 30 years, and had 230 projects in Henan at end 2021.
Adequate Land Bank: CCRE's attributable land bank of around 38.6
million square metres with estimated sales value of CNY200 billion
can sustain its sales for three to four years, taking into account
there are some large projects that may take time to churn.
Guarantees to Related Parties: CCRE provided a CNY500 million
financial guarantee to Henan Hongdao for a five-year bank loan,
which has been included in Fitch's leverage calculation. Henan
Hongdao is owned by CCRE's chairman and largest shareholder, and
Henan Hongdao's subsidiary is a supplier to CCRE. An increase in
related-party transactions and financial guarantees would cause
Fitch to consider negative rating action.
DERIVATION SUMMARY
The downgrade of CCRE's ratings to 'B' reflects its weak sales in
1H22 and limited financial flexibility. The RWN reflects Fitch's
uncertainties on its repayment of the USD500 million offshore bonds
in August 2022, and the completion of the proposed equity
transaction.
CCRE has stronger business profile and better liquidity than China
South City Holdings Limited (CSC, B-/Negative). CSC's attributable
contracted sales is about CNY10 billion a year, compared with
CCRE's about CNY30 billion a year. CSC completed the equity sale
with Shenzhen SEZ Construction and Development Group Co Ltd in May
2022, with has improved its onshore funding access. Fitch also
expects CCRE's funding access to improve after the completion of
its equity transaction.
KEY ASSUMPTIONS
Fitch's Key Assumptions Within Its Rating Case for the Issuer:
-- Total contracted sales of CNY40 billion-60 billion a year in
2022-2024;
-- Cash collection rate at 80-90% in 2022-2024;
-- Gross profit margin of about 15% in 2022-2024;
-- Annual land acquisition budget to be about 10%-30% of
contracted sales proceeds in 2022-2024.
Recovery Rating Assumptions:
Liquidation Approach
-- The liquidation estimate reflects Fitch's view of the value of
balance-sheet assets that can be realised in a sale or
liquidation process conducted during bankruptcy or insolvency
proceedings and distributed to creditors.
-- Advance rate of 80%, applied to accounts receivable. This
treatment is in line with Fitch's recovery rating criteria.
-- Advance rate of 57% applied to the book value of self-owned
investment properties. The portfolio has an average rental
yield of 3%, which is reasonable. The implied rental yield on
the liquidation value for the investment-property portfolio
would improve to 6%, which will be considered acceptable in a
secondary market transaction.
-- Advance rate of 50%, applied to property, plant and equipment,
which mainly consists of buildings, the value of which is
insignificant.
-- Advance rate of 62%, applied to net property inventory. The
inventory mainly consists of completed properties held for
sales, and properties under development (PUD), prepayments for
land acquisitions. Different advance rates were applied to
these different inventory categories to derived the blended
advance rates for net inventory.
-- Advance rate of 70% to completed properties held for sale.
Completed commodity housing units are closer to readily
marketable inventory. The company has historically a gross
margin for development property of around 15%. The company
also adopts a fast churn strategy, so its book value of
inventory should be close to the market value. Therefore, a
higher advance rate of 70% (against the typical 50% mentioned
in the criteria for inventory) was applied.
-- Advance rate of 50% to PUD and prepayment for development
projects. Unlike completed projects, PUD are more difficult to
sell. These assets are also in various stages of completion. A
50% advance rate was applied. The PUD balance - before
applying the advance rate - is net of margin adjusted customer
deposits.
-- Advance rate of 90% to deposits for land acquisitions. In a
similar way to completed commodity housing units, land held
for development is closer to readily marketable inventory. The
company has been the leading developer in Henan and has good
relationship with the Henan government. Fitch believes that
the company may be able to resell the land bank to the
government, if needed. Therefore, Fitch considered a higher
advance rate than the typical 50% mentioned in the criteria.
-- Advance rate of 50%, applied to joint-venture (JV) net assets.
JV assets typically include a combination of completed units,
PUD and land bank. A 50% advance rate was applied in line with
the baseline advance rate for inventories.
The allocation of value in the liability waterfall results in a
Recovery Rating corresponding to 'RR4' for the offshore senior
notes.
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
The RWN would be removed if the negative sensitivities are avoided,
in particular:
-- Timely repayment of the offshore bonds due in August 2022;
-- Completion of the proposed equity transaction resulting in an
improved liquidity and capital structure.
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
-- Failure to repay the offshore bonds due in August 2022;
-- Prolonged delay of the proposed equity transaction;
-- Deterioration in liquidity, funding access or sales proceeds.
BEST/WORST CASE RATING SCENARIO
International scale credit ratings of Non-Financial Corporate
issuers have a best-case rating upgrade scenario (defined as the
99th percentile of rating transitions, measured in a positive
direction) of three notches over a three-year rating horizon; and a
worst-case rating downgrade scenario (defined as the 99th
percentile of rating transitions, measured in a negative direction)
of four notches over three years. The complete span of best- and
worst-case scenario credit ratings for all rating categories ranges
from 'AAA' to 'D'. Best- and worst-case scenario credit ratings are
based on historical performance.
LIQUIDITY AND DEBT STRUCTURE
Tight Liquidity: CCRE had unrestricted cash of CNY5.9 billion
(excluding restricted cash of CNY2.7 billion) as of end-December
2021, while it had short-term debt of CNY3.8 billion. Fitch expects
the company to repay the USD500 million maturity due on 8 August
2022, mainly using proceeds from operational cash and asset
disposals.
ISSUER PROFILE
CCRE, established in 1992, is a leading property developer in Henan
province, focusing on developing residential properties, with about
7% market share in Henan for its heavy asset business.
ESG CONSIDERATIONS
Unless otherwise disclosed in this section, the highest level of
ESG credit relevance is a score of '3'. This means ESG issues are
credit-neutral or have only a minimal credit impact on the entity,
either due to their nature or the way in which they are being
managed by the entity.
DEBT RATING RECOVERY PRIOR
---- ------ -------- -----
Central China LT IDR B Downgrade B+
Real Estate Limited
senior unsecured LT B Downgrade RR4 B+
GUANGZHOU R&F: Creditors OK Regroup of 10 Offshore Bonds
--------------------------------------------------------
South China Morning Post reports that a Chinese property developer
has received a go-ahead from its offshore bond holders to regroup
all of its outstanding debt, in a restructuring that gives it three
to four years of breathing room as it struggles to raise cash.
According to the Post, Guangzhou R&F Properties will regroup all 10
tranches of its offshore bonds with US$4.94 billion in combined
principal amount due between now and 2024 into three amortisation
notes that mature in 2025, 2027 and 2028. The coupon rates of the
existing bonds, ranging between 5.75 per cent and 12.375 per cent,
will be fixed at 6.5 per cent for the new notes.
The new bonds are scheduled to be listed on the Singapore stock
exchange on July 15, according to R&F.
"The [payment] extension for the bonds, with no haircuts in the
face value and a slight coupon reduction is acceptable as the
extension would allow [investors] to avoid a lengthy debt
restructuring, and [still] be able to receive coupons in the
meantime," the Post quotes Lucror Analytics' credit analyst Leonard
Law as saying. "The holistic restructure could be a possible
approach for struggling developers that have yet to default."
The Post notes that the workout, advised by solicitation agents
including JPMorgan Securities (Asia Pacific), is good news for
China's beleaguered developers as they struggle to raise cash to
repay US$84 billion of debt due this year alone. A third of these
developers – such as China Evergrande Group, with the dubious
honour as the world's most indebted developer – may be "acutely
strained" in the worst-case scenario, said S&P Global Ratings.
"Investors understood that the key objective was to achieve a
sustainable capital structure without principal haircut and hence
they remain supportive to the structure," the report quotes
JPMorgan's executive director of Asia ex-Japan DCM origination Alan
Chan as saying.
R&F, founded by the developers Li Sze-lim and Zhang Li in 1994, has
been trying to dispose of its assets to avert a collapse from debt,
according to the Post. The company, based in the Guangdong
provincial capital, sold 30% of the Guangzhou International Airport
R&F Integrated Logistics Park for CNY7.3 billion (US$1.08 billion)
in December. It sold the Vauxhall Square parcel of land in London
for GBP95.7 million (US$113.6 million) in March, at a discount of
about 42% to market valuation.
The Post adds that the company is in the process of selling the R&F
Princess Cove project in southern Malaysia's Johor Baharu city, and
the London ONE project. R&F said it would use the proceeds of these
disposals to partially refinance its offshore bonds.
"It set a good benchmark," the Post quotes JPMorgan's Asia ex-Japan
head of real estate investment banking Rita Chan as saying. "The
sector needs clarity like this where issuers provide that
transparency to creditors ahead of time instead of leaving
investors to guess whether a company will be able pay or not."
The Post says the queue of struggling Chinese developers has grown
longer, as China's real estate sales slowed to a trickle in early
2022, as a resurgent Covid-19 outbreak in several major cities such
as Shanghai, Beijing and Shenzhen deterred consumers from
committing to big-ticket investments. That sapped developers of
cash, the very life blood they need to stay alive, after the
Chinese central bank barred indebted borrowers from taking on more
loans.
HO WAN KWOK: Court Approves Appointment of Luc Despins as Trustee
-----------------------------------------------------------------
Judge Julie A. Manning of the U.S. Bankruptcy Court for the
District of Connecticut approved the United States Trustee's
application to appoint Luc A. Despins as Chapter 11 Trustee in the
case of Ho Wan Kwok a/k/a Wengui Guo a/k/a Miles Guo.
Judge Manning further ordered that, within seven days after his
appointment, Despins must obtain a bond in favor of the United
States in the initial amount of $25,000, subject to further
increase or decrease as needed, conditioned on the faithful
performance of his official duties pursuant to 11 U.S.C. Section
322(a) of the Bankruptcy Code.
A copy of the order is available for free at https://bit.ly/3yTmBGa
from PacerMonitor.com.
About Ho Wan Kwok
Ho Wan Kwok sought protection under Chapter 11 of the Bankruptcy
Code (Bankr. D. Conn. Case No. 22-50073) on Feb. 15, 2022. Judge
Julie A. Manning oversees the case. Dylan Kletter, Esq., is the
Debtor's legal counsel.
Ho Wan Kwok aka Guo Wengui is an exiled Chinese businessman.
According to Reuters, Guo was a former real estate magnate who fled
China for the U.S. in 2014 ahead of corruption charges. Guo filed
for bankruptcy after a New York court ordered him to pay lender
Pacific Alliance Asia Opportunity Fund $254 million stemming from a
contract dispute. PAX had initially loaned two of Guo's companies
$100 million in 2008 for a construction project in Beijing and sued
Guo when he failed to pay off the loan.
An Official Committee of Unsecured Creditors has been appointed in
the case and is represented by Pullman & Comley, LLC.
INNER MONGOLIA BAOTOU: Fitch Affirms FC IDR at BB+, Outlook Stable
------------------------------------------------------------------
Fitch Ratings has affirmed China-based steel producer Inner
Mongolia Baotou Steel Union Co., Ltd.'s (BSUC) Long-Term
Foreign-Currency Issuer Default Rating (IDR) and foreign-currency
senior unsecured rating at 'BB+'. The Outlook is Stable.
BSUC's ratings are derived from Fitch's internal assessment of the
consolidated credit profile of its immediate 55% parent, Baotou
Iron & Steel (Group) Co., Ltd. (BISC). BSUC's ratings are linked to
the creditworthiness of BISC under Fitch's Parent and Subsidiary
Linkage Rating Criteria due to strong linkages between the two
entities. BISC is 77% owned by the Inner Mongolia Autonomous Region
and Fitch assesses its creditworthiness based on the four factors
set out in Fitch's Government-Related Entities Rating Criteria.
The Stable Outlook reflects Fitch's expectation of BSUC's steady
operation, with continued operational, management and financial
support from BISC.
KEY RATING DRIVERS
Parent's Solid State Linkages: BISC is the world's largest rare
earth producer and has historically received around half (55% in
2021) of the annual rare earth ore production quota issued by
China's Ministry of Industry and Information Technology. BISC has
China's largest reserves of rare earth and niobium, in which the
country has a near monopolistic position. The government deems
BISC's rare earth and niobium reserves as nationally strategic.
BISC is also the largest industrial company in the Inner Mongolia
Autonomous Region by revenue and provides significant employment
opportunities, with 48,300 employees at end-2021. This reinforces
social stability.
'High' Operational, Strategic Incentive For Parental Support: Fitch
believes BISC has a 'High' operational and strategic inventive to
support BSUC. BISC owns 55% of BSUC, which is its main steel
operating subsidiary, accounting for more than 70% of the group's
total assets and over 50% of consolidated EBITDA at end-2021. BISC
also has absolute management control over BSUC, with significant
management overlap. Meanwhile, some of group's rare earths serve as
raw material for BSUC's steel products.
'Medium' Legal Incentive For Parental Support: Fitch believes that
BISC has a 'Medium' legal incentive to support BSUC, as it
continuously guarantees to a significant part of BSUC's bank debt.
Persistently High Leverage: Fitch expects BSUC's Standalone Credit
Profile to stay weak amid high leverage, as measured by net
debt/EBITDA. Fitch expects net leverage to remain above 4.0x in
2022-2025 (2021: 3.3x), as the average selling price for steel is
likely to drop from 2021's high levels. Fitch expects a slight
pick-up in capex in the medium term, but it should remain
reasonable compared with revenue. Fitch expects BSUC's financial
flexibility metrics to remain intact, with EBITDA/interest paid
maintained at above 4.0x (2021: 5.7x)
Stable Funding Provides Liquidity: BSUC had CNY22 billion in
short-term debt outstanding at end-2021, against CNY5 billion of
cash on hand and CNY5 billion in unused available credit
facilities. Capital market debt accounts for around 40% of its
total debt and about half of total debt is short-term.
Fitch expects BSUC to be able to roll over its short-term debt,
given support from BISC. BISC had CNY19 billion in unused available
credit facilities at end-2021 and has reliable funding access due
to strong government support and long-term relationships with major
commercial and policy banks.
DERIVATION SUMMARY
We rate BSUC on a top-down basis from its parent under Fitch's
Parent and Subsidiary Linkage Rating Criteria. Fitch's internal
assessment of BISC's credit profile is based on Fitch's
Government-Related Entities Rating Criteria.
BSUC's rating is derived under the same methodology as used for
Sinochem Hong Kong (Group) Company Limited (A/Stable) and COFCO
(Hong Kong) Limited (A/Stable).
KEY ASSUMPTIONS
-- Revenue to drop to below CNY80 billion in 2022 amid falling
average selling prices for steel, then falling to below CNY70
billion in 2023 as Fitch expects steel prices to continue
declining;
-- EBITDA margin to drop to 10% in 2022 due to high raw material
costs, then stabilising at 12% in 2023-2025, supported by
lower input costs and a margin recovery;
-- Capex of around 3%-4% of revenue during 2022-2025, mainly for
facility technical and environmental upgrades.
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
-- An upgrade of Fitch's internal assessment of the
creditworthiness of Inner Mongolia Autonomous Region;
-- Increase in the likelihood of support from the Inner Mongolia
government.
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
-- A downgrade of Fitch's internal assessment of the
creditworthiness of Inner Mongolia;
-- Weakening of likelihood of support from the Inner Mongolia
government;
-- Weakening linkages between BISC and BSUC.
BEST/WORST CASE RATING SCENARIO
International scale credit ratings of Non-Financial Corporate
issuers have a best-case rating upgrade scenario (defined as the
99th percentile of rating transitions, measured in a positive
direction) of three notches over a three-year rating horizon; and a
worst-case rating downgrade scenario (defined as the 99th
percentile of rating transitions, measured in a negative direction)
of four notches over three years. The complete span of best- and
worst-case scenario credit ratings for all rating categories ranges
from 'AAA' to 'D'. Best- and worst-case scenario credit ratings are
based on historical performance.
LIQUIDITY AND DEBT STRUCTURE
Adequate Liquidity: BSUC had CNY22 billion in short-term debt
outstanding at end 2021, compared with CNY5 billion in cash on hand
and CNY5 billion in unused available credit facilities. The credit
facilities were uncommitted, but Fitch believes they are adequate,
as committed facilities are uncommon in China. BSUC's debt maturity
is concentrated, with short-term debt accounting for over half of
total debt. Fitch expects BSUC to be able to continue rolling over
its short-term debt, given support from BISC. BSUC expects total
uncommitted facilities to increase by around CNY25 billion from the
end-2021 level, according to its 2022 credit facility application.
ISSUER PROFILE
BISC is engaged in iron ore and rare earth mining and steel
production and BSUC is its main operating subsidiary. BSUC has an
annual steel product production capacity of around 17 million
tonnes. Its main products include pipes, flat steel, section steel
and long products. BSUC has expanded its business profile to
include iron ore and rare earth mining in recent years, supported
by asset injections from BISC.
ESG CONSIDERATIONS
Unless otherwise disclosed in this section, the highest level of
ESG credit relevance is a score of '3'. This means ESG issues are
credit-neutral or have only a minimal credit impact on the entity,
either due to their nature or the way in which they are being
managed by the entity.
DEBT RATING PRIOR
---- ------ -----
Inner Mongolia LT IDR BB+ Affirmed BB+
Baotou Steel
Union Co., Ltd.
senior unsecured LT BB+ Affirmed BB+
REMARK HOLDINGS: Holds Annual Stockholders' Meeting
---------------------------------------------------
Remark Holdings, Inc. held its annual meeting of stockholders at
which the stockholders:
(1) elected Theodore P. Botts, Brett Ratner, Daniel Stein,
Kai-Shing Tao, and Elizabeth Xu as directors to serve until the
Company's 2023 annual meeting of stockholders and until their
successors are duly elected and qualified;
(2) ratified the appointment of Weinberg & Company, P.A. as the
Company's independent registered public accounting firm for the
fiscal year ending Dec. 31, 2022;
(3) approved a non-binding, advisory resolution authorizing the
compensation of the Company's named executive officers; and
(4) adopted and approved the Company's 2022 Incentive Plan.
About Remark Holdings
Remark Holdings, Inc. (NASDAQ: MARK) --
http://www.remarkholdings.com-- its subsidiaries, and the
variable-interest entities that the company consolidates,
constitute a diversified global technology business with leading
artificial intelligence and data-analytics, as well as a portfolio
of digital media properties The company's easy-to-install AI
products are being rolled out in a wide range of applications
within the retail, urban life cycle and workplace and food safety
arenas. The company also owns and operates digital media
properties that deliver relevant, dynamic content and ecommerce
solutions. The company's corporate headquarters and U.S.
operations are based in Las Vegas, Nevada, and it also maintain
operations in London, England and Shanghai, China. The operations
of the variable interest entities the company consolidates are
headquartered in Chengdu, China with additional operations in
Hangzhou.
As of March 31, 2022, the Company had $47.12 million in total
assets, $40.99 million in total liabilities, and $6.12 million in
total stockholders' equity.
Los Angeles, California-based Weinberg & Company, the Company's
auditor since 2020, issued a "going concern" qualification in its
report dated March 31, 2022, citing that the Company has suffered
recurring losses from operations and negative cash flows from
operating activities and has a negative working capital and a
stockholders' deficit that raise substantial doubt about its
ability to continue as a going concern.
SANSHENG HOLDINGS: Moody's Withdraws 'Ca' Corporate Family Rating
-----------------------------------------------------------------
Moody's Investors Service has withdrawn the Ca corporate family
rating of Sansheng Holdings (Group) Co. Ltd.
Prior to the withdrawal, the rating outlook on Sansheng was
negative.
RATINGS RATIONALE
Moody's has decided to withdraw the rating for its own business
reasons.
COMPANY PROFILE
Based in China, Sansheng has over 20 years of property development
experience. Its gross contracted sales reached RMB24.5 billion in
2021. As of the end of 2021, the company had 55 property
development projects with a land bank of 7.4 million square meters.
STX DALIAN: Chinese Shipyard Sold Decade After Financial Collapse
-----------------------------------------------------------------
The Maritime Executive reports that nearly eight years after all
work stopped at the Dalian shipyard, one of the last pieces in the
long-running bankruptcy of STX has been sold. Chinese officials
reported that they completed the auction of the remaining assets of
STX Dalian Shipbuilding, which had been the largest foreign
investment in the Chinese shipbuilding industry.
The Maritime Executive relates that Hengli Heavy Industry Group
Co., a subsidiary of Hengli Group, was the successful bidder for
the shipyard with reports indicating that they paid $257 million
for the assets. Hengli is said to be the second-largest private
enterprise in China with diversified interests including large
operations in the refining and chemical industries. The Maritime
Executive relates that the company is reported to have shipbuilding
and marine heavy tool manufacturing interests but it was unclear if
they planned to open a commercial shipyard on the site at Changxing
Island. Chinese media reports said the company plans to establish a
"high-end port equipment manufacturing base."
The STX shipyard opened in 2006 and was widely promoted as part of
the industrial development of Changxing and Dalian. At its peak, it
employed 30,000 people before beginning to experience financial
troubles in 2012, the report notes. The downturn in the global
shipbuilding industry led to financial problems for all of the
South Korean company's operations and by 2013 there were reports
that the company was exploring the sale of assets possibly in
Finland, France, and China. Chinese tried to raise additional
capital for the Dalian shipyard.
Bankruptcy proceedings for the Dalian shipyard were initiated in
2014, a year before STX collapsed, the report recalls. The Chinese
yard sought court permission to restructure and reorganize, laying
off 10,000 people while losing several shipbuilding orders. In
March 2015, however, the yard was declared bankrupt with reports
saying China was selling off the company in pieces, The Maritime
Executive relates. The company was said to have debt of $3.2
billion.
According to the report, Dalian Shipbuilding Industry Company was
interested in acquiring the main shipyard facility but the deal was
blocked by its parent company. After that, China attempted to
auction off the STX Dalian facility with as many as 10 auctions
failing to find a buyer for the facility. The shipyard has remained
idle since 2015.
The Maritime Executive says the sale of the shipyard in China comes
a year after South Korea's state-owned bank completed the sale of
the company's South Korean operations. Two South Korean investment
firms acquired the company for just over $200 million and
relaunched the shipyard as K Shipbuilding, the report notes. The
company's other assets, including the yards in France and Finland,
had been sold several years earlier. At its peak, STX, which was
started in 1967, had been the world's fourth largest shipbuilder
and the first to have an extensive network of yards ranging from
Europe to Asia.
STX Dalian was established in 2007, with a registered capital of
USD1.125 billion, and employed over 20,000 people at its peak time.
However, the STX chaebol's deterioration into financial trouble in
2013 precipitated STX Dalian's demise.
STX Dalian is a subsidiary of Korea's STX Offshore & Shipbuilding.
The company is based in Dalian, China.
=========
I N D I A
=========
ACEBRIGHT PHARMA: Ind-Ra Cuts Long-Term Issuer Rating to 'BB'
-------------------------------------------------------------
India Ratings and Research (Ind-Ra) has downgraded Acebright
(India) Pharma Private Limited's Long-Term Issuer Rating to 'IND BB
(ISSUER NOT COOPERATING)' from 'IND BBB- (ISSUER NOT COOPERATING)'.
The instrument-wise rating actions are:
-- INR70 mil. Fund-based limit downgraded with IND BB (ISSUER NOT
COOPERATING) rating;
-- INR5 mil. Non-fund-based limit downgraded with IND A4+ (ISSUER
NOT COOPERATING) rating; and
-- INR780 mil. Term loan due on October 31, 2028 downgraded with
IND BB (ISSUER NOT COOPERATING) rating.
Note: ISSUER NOT COOPERATING: Issuer not cooperating; based on the
best available information
Key Rating Drivers
The downgrade is pursuant to the Securities and Exchange Board of
India's circular SEBI/HO/MIRSD/CRADT/CIR/P/2020/2 dated January 3,
2020. As per the circular, any issuer with an investment-grade
rating remaining non-cooperative with a rating agency for more than
six months should be downgraded to a sub-investment grade rating.
The current outstanding rating of 'IND BB (ISSUER NOT COOPERATING)'
may not reflect Acebright (India) Pharma's credit strength as the
company has been non-cooperative with the agency since December
2021. Therefore, investors and other users are advised to take
appropriate caution while using these ratings.
Company Profile
Bengaluru-based Acebright (India) Pharma primarily manufactures
oncology active pharmaceutical ingredients (APIs) and general APIs.
It has a total installed capacity of 320 million tons per annum
(mtpa) (general API 200mtpa and oncology API 120mtpa).
AMKO EXPORTS: CRISIL Withdraws B Rating on INR1.12cr Term Loan
--------------------------------------------------------------
CRISIL has withdrawn the ratings on certain bank facilities of Amko
Exports (AE), as:
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Letter of Credit 2 CRISIL A4/Issuer Not
Cooperating (Withdrawn)
Packing Credit 4.2 CRISIL A4/Issuer Not
Cooperating (Withdrawn)
Post Shipment Credit 2.4 CRISIL A4/Issuer Not
Cooperating (Withdrawn)
Pre Shipment Credit 0.4 CRISIL A4/Issuer Not
Cooperating (Withdrawn)
Proposed Long Term 0.88 CRISIL B/Stable/Issuer Not
Bank Loan Facility Cooperating (Withdrawn)
Rupee Term Loan 1.12 CRISIL B/Stable/Issuer Not
Cooperating (Withdrawn)
CRISIL Ratings has been consistently following up with AE for
obtaining information through letters and emails dated March 26,
2021 and September 14, 2021 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
Ratings failed to receive any information on either the financial
performance or strategic intent of AE. This restricts CRISIL
Rating's ability to take a forward looking view on the credit
quality of the entity. CRISIL Ratings believes that rating action
on AE is consistent with 'Assessing Information Adequacy Risk'.
CRISIL Ratings has Continues the ratings on the bank facilities of
AE to 'CRISIL B/Stable/CRISIL A4 Issuer not cooperating'.
CRISIL Ratings has withdrawn its rating on the bank facilities of
AE on the request of the company and after receiving no objection
certificate from the bank. The rating action is in-line with CRISIL
Rating's policy on withdrawal of its rating on bank loan
facilities.
Established in 1992, AE is promoted by Mr Mahesh Singhal. AE is an
export-oriented unit engaged in the manufacturing & export of
textile home furnishing made-ups such as bedsheets, curtains,
cushion covers and cotton blankets.
ANGEL BABY: Ind-Ra Assigns BB+ LT Issuer Rating, Outlook Stable
---------------------------------------------------------------
India Ratings and Research (Ind-Ra) has assigned Angel Baby
Products Private Limited (ABPPL) a Long-Term Issuer Rating of 'IND
BB+'. The Outlook is Stable.
The instrument-wise rating action is:
-- INR100 mil. Term loan due on March 2029 assigned with IND BB+/
Stable rating.
ANALYTICAL APPROACH: Ind-Ra has taken a consolidated view of ABPPL
and its group companies Brandavan Food Products ('IND
BBB-'/Stable), RK Hoteliers and Developers, Pacifica Hotels
(Ahmedabad Project) Private Limited, Roop Caterers ('IND
BBB-'/Stable), R. K. Associates & Hotelier Private Limited (RKAHPL;
'IND BBB-'/Stable) and Satyam Caterers; collectively referred to as
the RK Group, while assigning the ratings. This is due to the
strong operational and legal linkages among them, a common
management, similar line of business and corporate guarantees
provided to each other's entire debt. ABPPL's standalone rating is
a notch lower than the rating assigned at the group level on
account of smaller scale of operations. The group also has
additional entities apart from those mentioned above; although,
Ind-Ra has not considered them while assigning the ratings due to
the lack of operational or legal linkages.
Key Rating Drivers
Need-Based Financial Support: The group provides need-based
financial support for project funding and debt servicing by way of
unsecured loans. In FY22, the group infused interest-free unsecured
loans worth INR688 million across group companies. However, the
loan agreement does contain covenants for specific companies, which
require authorization for any cash flow fungibility. Nevertheless,
Ind-Ra continues to take a consolidated approach due to the strong
operational and legal linkages.
High Entry Barriers: RK group has a dominant position in the
railway catering business with a 64% market share in FY20. Despite
the high entry barriers, the group has strategies in place as
competitors tend to bid for a higher number of tenders to sustain
in the long term. The group has over three decades of experience in
the railway catering and hospitality business.
Medium Scale of Operations: The group's revenue surged to INR3,235
million in FY22 (FY21: INR679.91 million, FY20: INR7,087.07
million), on account of increase in occupancy levels in hotel and
train passenger traffic, following the relaxation of COVID-19-led
restrictions. Ind-Ra expects the revenue to gradually improve with
the increase in hotel occupancy rates, backed by increased
promotional activities. The railway restaurant and catering segment
was operational only in 4QFY22 and the food fare was not included
in the ticket fare. Thus, Ind-Ra expects with steady state
performance, the revenue to reach pre-covid levels of around
INR7,000 million in FY23. The group booked revenue of INR2,400
million during April-May 2022 and is likely to record revenue of
INR9,000 million in FY23. The group has also ventured into the
Bharat Gaurav Scheme, India's first private train service for its
business growth; however, the revenue contribution from such trains
is yet to be witnessed. FY22 financials are provisional in nature.
Experienced Promoters: The group's founder S.B Agrawal has around
six decades of experience in the catering business and the promoter
Rahul Agrawal, who is actively involved in the railway catering
business, has three decades of experience. The RK group has an
extensive experience of over six decades in rail catering business.
The group operates three divisions: railways, hotels and hospitals.
RKAHPL, Roop Caterers, Brandavan Food Products and Satyam Caterers
together operate the catering business. While Pacifica Hotels
(Ahmedabad Project) and ABPPL operate hotels in Ghaziabad, Noida,
Raipur, Ahmedabad and Goa. The hotels in Ghaziabad and Goa are
operated Imperial Tobacco Company of India Limited (ITC), Raipur
and Ahmedabad hotels by Marriott International Inc, and Goa hotel
by Westin Hotels and Resorts. The hotels in Ahmedabad and Goa are
managed by Pacifica Hotels (Ahmedabad Project), while the hotel in
Noida (ITC) and Raipur are managed by ABPPL and RK Hoteliers and
Developers, respectively.
Liquidity Indicator - Adequate: The group's cash and cash
equivalents stood at INR969 million at FYE22. Ind-Ra expects the
group to maintain similar cash balances in the foreseeable future.
Furthermore, during COVID-19, the group did not opt for loan
restructuring and second moratorium on account of the sufficient
cash in hand and unsecured loans being infused by the promoters.
The cash flow from operations turned positive to INR240.76 million
in FY22 (FY21: negative INR55.36 million) backed by improved
operating performance. The average utilization of the fund-based
working capital limits was 98.49% for the 12 months ended May 2022.
The group has scheduled repayments of INR362 million in FY23. The
working capital cycle was negative 174 days in FY22 (FY21: negative
147 days, FY20: negative 54 days) owing to an increase in payable
period. Ind-Ra expects the working capital cycle to remain at
similar levels in FY23 on account of the long creditor period. The
management expects to maintain a sizeable cash balance of around
INR500 million at all times.
Modest EBITDA Margins: The group operates its railway catering
business through Brandavan Food Products, Roop Caterers, Satyam
Caterers and RKAHPL to bid for higher tenders. The tenders are
entered for a period of five years where the license fee is
determined after factoring in the inflation and is disbursed in the
first year. Thus, the margins are highest in the initial year and
decline in the succeeding years. The group had modest EBITDA
margins of 15.97% in FY22 (FY21: negative 16.99%) with a return on
capital employed of 3.3% (negative 3.6%). The margins have expanded
due to the stabilization of the railway catering and hospitality
segments following the unlocking of economic activities.
Furthermore, the hospitality business fetched higher margins in
FY22 than FY21 by offering discounts. The room fare is also
adjusted based on the prevailing inflation, thus helping the group
to attain margins of 20%-23%. Moreover, the group's tie-ups with
established brands provides comfort in determining the fare/room
tariffs mainly because of the reputation and the quality of
services offered.
Modest Credit Metrics: The interest coverage (operating
EBITDAR/gross interest expense) improved to 1.16x in FY22 (FY21:
negative 0.66x, FY20: 4.30x) and the net leverage (total adjusted
net debt/operating EBITDAR) to 6.96x (negative 31.14x, 2.92x) as
the group reported an EBITDA profit in FY22, against a loss in
FY21. Around 33% of the group's debt is unsecured loans from
related parties. The debt is likely to remain at similar levels in
FY23-FY24.
Cyclical and Seasonal Business: The hospitality industry is
witnessing a higher level of competition, particularly in the
high-end segment, with the arrival of several new players and
expansion by existing players. The hotel industry is influenced by
the prevailing economic conditions. The hotel industry particularly
those catering to leisure travel is seasonal in nature. These
factors could impact occupancy levels, room rate realization and
cash flows generated by hotels. Also, railway catering is
interlinked to the hospitality business and eventually is also
cyclical in nature.
Standalone Performance: On a standalone basis, revenue was
INR110.81 million in FY22 (FY21: INR67.73 million), EBITDA margin
was 18.16%% (0.09%), interest coverage was 0.83x (0.00x) and net
leverage was 8.35x (3,009.83x). The company did not avail any
fund-based limits to meet its working capital requirements. The
company has scheduled repayments of INR42.62 million in FY23.
During April-May 2022, it achieved revenue of INR24.895 million.
Rating Sensitivities
Positive: A substantial improvement in the scale of operations
along with the consolidated net leverage reducing below 4.0x, while
maintaining its liquidity profile, all on a sustained basis, will
be positive for the ratings.
Negative: A substantial decline in scale of operations or any
deterioration in the liquidity position or the consolidated net
leverage remaining above 5.0x on a sustained basis, will be
negative for the ratings.
Company Profile
Established in 1995, ABPPL has a hotel in Noida which is operated
by ITC.
APSARA POWER: CRISIL Assigns B+ Rating to INR12cr Term Loan
-----------------------------------------------------------
CRISIL Ratings has assigned its 'CRISIL B+/Stable' rating to the
bank facilities of Apsara Power India Private Limited (APIPL).
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Term Loan 12 CRISIL B+/Stable (Assigned)
The rating reflects customer concentration risks and susceptibility
to risks inherent in wind power projects. The rating also factors
in modest scale of operations and weak financial risk profile.
These weaknesses are partially offset by extensive industry
experience of the promoters.
Key Rating Drivers & Detailed Description
Weaknesses:
* Customer concentration risk: The company's revenues are mainly
derived from supplying to one to only counterparty - Agni Steels
Pvt Ltd. Although the payments are largely received in 20-30 days
from counterparty, concentration risk on a single customer
persists.
* Exposure to risks inherent in operating wind-energy assets: Wind
power generation is highly vulnerable to seasonality and variance
in wind intensity, which could reduce the operating PLF, thus
impairing the project's debt-servicing ability. Cash flow of wind
power projects is highly sensitive to PLF, while also being
impacted by other factors such as operating cost and interest rate.
PLF is inherently unpredictable as it depends on wind patterns and
any unfavourable deviation in wind speed and pattern will
significantly reduce PLF, thereby impairing debt servicing
ability.
* Modest scale of operation and weak financial risk profile: APIPLs
business profile is constrained by its scale of operations in the
intensely competitive industry. APIPLs scale of operations will
continue limit its operating flexibility. It currently has a
capacity of 2.5 MW and is adding capacities of another 2 MW. The
company has had losses in fiscal 2021, leading to negative cash
accruals as against its repayment obligations. The DSCR over the
medium term is expected to improve to over 1 time; nevertheless,
would remain contingent on PLF and maintenance costs.
Strength:
* Extensive industry experience of the promoters: The promoters
have an experience of over 25 years in Independent Power Producers
& Energy Traders industry. This has given them an understanding of
the dynamics of the market, and enabled them to establish
relationships with suppliers and customers.
Liquidity: Stretched
The DSCR is likely to be greater than a unity in the next three
years as well as over the repayment tenure. However, the company
had negative cash accruals in fiscal 2021. Furthermore,
unencumbered bank balance of INR0.08-0.1 crore and unsecured loans
from promoters will act as a cushion to the liquidity. Bank loan is
being used to fund ongoing project.
The promoters are likely to extend support in the form of unsecured
loans to meet its working capital requirements and repayment
obligations. Negative net worth limits its's financial flexibility
and restricts the financial cushion available to the company in
case of any adverse conditions or downturn in the business. Also,
the company does not maintain any DSRA (debt service reserve
account) with the bank.
Outlook: Stable
CRISIL Ratings believes APIPL's debt servicing coverage ratio
(DSCR) will improve over the medium term, backed by steady cash
inflow.
Rating Sensitivity factors
Upward factors
* If DSCR improves to 1.3 times due to better PLF and tariff
* Commencement and stabilization in new capacities resulting in
improved cash flows
Downward factors
* Significant degradation in plant load factor (PLF) to below 15%
or delays in receipts
* Delay in commencement and stabilization of new project impacting
liquidity
* Inability to achieve anticipated rates or weak operating
performance hits profitability
APIPL was incorporated in 2015. APIPL is engaged in operating wind
power plant at Karur, TN. APIPL is owned & managed by Mr. M
Chinnasami, Mr. R Krishnamoorthy and Mr. K Thangavelu.
ASIAN HOTELS: Ind-Ra Moves 'D' LT Issuer Rating to Non-Cooperating
------------------------------------------------------------------
India Ratings and Research (Ind-Ra) has migrated Asian Hotels
(West) Limited's (AHWL) Long-Term Issuer Rating to the
non-cooperating category. The issuer did not participate in the
rating exercise despite continuous requests and follow-ups by the
agency. Therefore, investors and other users are advised to take
appropriate caution while using these ratings. The rating will now
appear as 'IND D (ISSUER NOT COOPERATING)' on the agency's website.
The instrument-wise rating actions are:
-- INR2,207.65 bil. Term loan (Long-term) due on March 2033
migrated to non-cooperating category with IND D (ISSUER NOT
COOPERATING) rating; and
-- INR270 mil. Fund-based working capital limits (Long-term/
Short-term) migrated to non-cooperating category with IND D
(ISSUER NOT COOPERATING) rating.
Note: ISSUER NOT COOPERATING: The ratings were last reviewed on May
5, 2021. Ind-Ra is unable to provide an update, as the agency does
not have adequate information to review the ratings.
Company Profile
AHWL was incorporated on January 8, 2007 as Chillwinds Hotels
Private Limited and was changed to the present name on February 12,
2010. The company entered into a scheme of arrangement and demerger
with Asian Hotels Limited, under which Hyatt Regency Mumbai of the
Asian Hotels was demerged and vested in the company.
AHWL operates a 401-room five-star hotel in Mumbai and has
partnered with Hyatt Hotels India for branding, operating and
marketing the hotel under the Hyatt Regency brand.
ATHAVAN SOLAR: CRISIL Assigns B+ Rating to INR13.5cr Term Loan
--------------------------------------------------------------
CRISIL Rating has assigned its 'CRISIL B+/Stable' rating to the
bank facilities of Athavan Solar Projects (ASP).
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Rupee Term Loan 13.5 CRISIL B+/Stable (Assigned)
The rating reflects customer concentration risks and susceptibility
to risks inherent in wind power projects. The rating also factors
in modest scale of operations and weak financial risk profile.
These weaknesses are partially offset by extensive industry
experience of the promoters
Key Rating Drivers & Detailed Description
Weaknesses:
* Customer concentration risk: The company's revenues are mainly
derived from supplying to one to only counterparty - Agni Steels
Pvt Ltd. Although the payments are largely received in 20-30 days
from counterparty, concentration risk on a single customer
persists.
* Exposure to risks inherent in operating wind-energy assets: Wind
power generation is highly vulnerable to seasonality and variance
in wind intensity, which could reduce the operating PLF, thus
impairing the project's debt-servicing ability.
* Cash flow of wind power projects is highly sensitive to PLF,
while also being impacted by other factors such as operating cost
and interest rate. PLF is inherently unpredictable as it depends on
wind patterns and any unfavourable deviation in wind speed and
pattern will significantly reduce PLF, thereby impairing debt
servicing ability.
* Modest scale of operation and weak financial risk profile: ASPs
business profile is constrained by its scale of operations in the
intensely competitive industry. ASP's scale of operations will
continue limit its operating flexibility. It currently has a
capacity of 4 MW and is adding capacities of another 4.2 MW.
The company has had losses in fiscal 2021, leading to negative cash
accruals as against its repayment obligations. The DSCR over the
medium term is expected to improve to over 1 time; nevertheless,
would remain contingent on PLF and maintenance costs.
Strength:
* Extensive industry experience of the promoters: The promoters
have an experience of over 25 years in Independent Power Producers
& Energy Traders industry. This has given them an understanding of
the dynamics of the market and enabled them to establish
relationships with suppliers and customers.
Liquidity: Stretched
The DSCR is likely to be greater than a unity in the next three
years as well as over the repayment tenure. However, the company
had negative cash accruals in fiscal 2021. Furthermore,
unencumbered bank balance of INR0.08-0.1 crore and unsecured loans
from promoters will act as a cushion to the liquidity. Bank loan is
being used to fund ongoing project.
The promoters are likely to extend support in the form of unsecured
loans to meet its working capital requirements and repayment
obligations. Negative net worth limits its's financial flexibility
and restricts the financial cushion available to the company in
case of any adverse conditions or downturn in the business. Also,
the company does not maintain any DSRA(debt service reserve
account) with the bank.
Outlook: Stable
CRISIL Ratings believes ASP's debt servicing coverage ratio (DSCR)
will improve over the medium term, backed by steady cash inflow
Rating Sensitivity factors
Upward factors
* If DSCR improves to 1.25 times due to better PLF and tariff
* Commencement and stabilization in new capacities resulting in
improved cash flows
Downward factors
* Significant degradation in plant load factor (PLF) below 20% or
delays in receipts
* Delay in commencement and stabilization of new project impacting
liquidity
* Inability to achieve anticipated rates or weak operating
performance hits profitability
ASP was incorporated in 2013, engaged in operating wind power plant
at Karur. ASP is owned & managed by Mr. M Chinnasami, Mr. R
Krishnamoorthy and Mr.K Thangavelu
BENGAL EMTA: Insolvency Resolution Process Case Summary
-------------------------------------------------------
Debtor: Bengal Emta Coal Mines Limited
5B, Nandalal Bose Sarani
Russel Street
Kolkata 700071
West Bengal, India
Insolvency Commencement Date: June 30, 2020
Court: National Company Law Tribunal, Kolkata Bench
Estimated date of closure of
insolvency resolution process: December 26, 2022
Insolvency professional: Swapnil Jain
Interim Resolution
Professional: Swapnil Jain
CA 10, Sector I
Salt Lake
Kolkata 700064
E-mail: swapniljain88@gmail.com
- and -
Central Plaza, 5th Floor
Room No. 5A
41 B B Ganguly Street
Kolkata 700012
E-mail: cirp.becml@gmail.com
Last date for
submission of claims: July 16, 2022
BINDAL FASHION: Insolvency Resolution Process Case Summary
----------------------------------------------------------
Debtor: Bindal Fashion Private Limited
"Bindal House", Plot No. 23
Fudinawadi, Near Sahara Darwaja
Ring Road, Surat
Gujarat 395002
Insolvency Commencement Date: July 11, 2022
Court: National Company Law Tribunal, Mumbai Bench
Estimated date of closure of
insolvency resolution process: January 4, 2023
(180 days from commencement)
Insolvency professional: Mr. Shreyansh Jain
Interim Resolution
Professional: Mr. Shreyansh Jain
505 Silver Coin Apartment
Behind Aakashwani, Paota C Road
Jodhpur, Rajasthan 342001
E-mail: ca.shrevansh@gmail.com
- and -
B Wing 601-604, Raylon Arcade
RK Mandir Road, Near Pidilite
Kondivita, Andheri (East)
Mumbai 400050
E-mail: cirp.bindalfashion@gmail.com
Last date for
submission of claims: July 25, 2022
BLDEU: Ind-Ra Downgrades Long-Term Issuer Rating to 'BB'
--------------------------------------------------------
India Ratings and Research (Ind-Ra) has downgraded BLDE (Deemed to
be University)'s (BLDEU) Long-Term Issuer Rating to 'IND BB (ISSUER
NOT COOPERATING)' from 'IND BBB- (ISSUER NOT COOPERATING)'. The
issuer did not participate in the rating exercise despite
continuous requests and follow-ups by the agency.
The instrument-wise rating action is:
-- INR50 mil. Proposed bank loans downgraded with IND BB (ISSUER
NOT COOPERATING) rating.
Note: ISSUER NOT COOPERATING: Issuer did not cooperate; based on
the best available information.
Key Rating Drivers
The downgrade is pursuant to the Securities and Exchange Board of
India's circular SEBI/HO/MIRSD/CRADT/CIR/P/2020/2 dated January 3,
2020. As per the circular, any issuer with an investment-grade
rating remaining non-cooperative with a rating agency for more than
six months should be downgraded to a sub-investment grade rating.
The current outstanding rating of 'IND BB (ISSUER NOT COOPERATING)'
may not reflect BLDE (Deemed to be University)'s credit strength
as the company has been non-cooperative with the agency since
December 2021. Therefore, investors and other users are advised to
take appropriate caution while using these ratings.
Company Profile
BLDEU was established as a deemed university under section 3 of the
University Grants Commission Act, 1956. BLDEU, registered under the
Karnataka Societies Registration Act, 1960. manages a college -
Shri B. M. Patil Medical College and a 1,250-bed hospital Shri B.
M. Patil Medical College Hospital & Research Centre.
Shri B. M. Patil Medical College offers under graduate programme
MBBS (with an annual intake of 150 students), postgraduate
programmes in 18 disciplines, postgraduate super specialty
programme in urology, Doctor of Philosophy programme in 14
disciplines and innovative courses such as fellowship, diploma and
certificate courses in medical and allied sciences.
BOLA RAGHAVENDRA: CRISIL Raises Rating on INR75cr Loan to B+
------------------------------------------------------------
CRISIL Ratings has upgraded its ratings on the bank facilities of
Bola Raghavendra Kamath and Sons (BRKS) to 'CRISIL B+/Stable/CRISIL
A4' from 'CRISIL D/CRISIL D.'
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Packing Credit 75 CRISIL B+/Stable (Upgraded
from 'CRISIL D')
Proposed Short Term 25 CRISIL A4 (Upgraded from
Bank Loan Facility 'CRISIL D')
The rating upgrade reflects timely servicing of debt obligations
and improvement in the financial risk profile. Also, operating
income is expected to increase from INR177 crores in FY22 to around
INR200-200 crore in FY 23; while margin has remained stable at 8-9%
in the last two fiscals. However, this is partially offset by its
susceptibility to volatility in cashew prices and below average
financial profile.
Key Rating Drivers & Detailed Description
Weaknesses:
* Susceptibility to volatility in cashew prices: BRKS's operating
margin is constrained by the commodity nature of its products, and
has remained in the range of 8-9% in FY21 and FY22. Presence in a
segment with limited value addition and negligible differentiation
in products of different players also constrains the margin.
* Below average financial profile: BRKS has below average financial
profile marked by gearing of 2.32 times and Total Outside
Liabilities to Tangible Networth (TOL/TNW) of 2.5 times for the
year ending on 31st March 2022 BRKS's debt protection measures are
moderate with interest coverage and net cash accrual to total debt
(NCATD) ratio at 2.3 times and 0.6 times for FY22. BRKS debt
protection measures are expected to improve over the medium term.
Strength:
* Established market position supported by extensive industry
experience of the partners: The partners have an extensive
experience of more than six decades in Cashew industry. This has
given them an understanding of the dynamics of the market and
enabled them to establish relationships with suppliers and
customers.
Liquidity: Stretched
Expected cash accrual of over INR8-11 crore per fiscal will
sufficiently cover yearly term debt obligation of INR2 crore over
the medium term. Bank limit utilization was high, averaging 88-for
the 12 months through May 2022. Current ratio was average at less
than 1 time as on March 31, 2022. Moderate cash and bank balances
will also support liquidity. Improved working capital cycle to aid
in improved liquidity profile shall continue to remain a key
sensitivity factor.
Outlook: Stable
CRISIL Ratings believe BRKS will continue to benefit from the
extensive experience of its promoter, and established relationships
with clients.
Rating Sensitivity factors
Upward factors
* Sustenance in margins and improvement in scale by 20%, leading to
higher cash accruals.
* Improvement in financial risk profile
Downward factors
* Decline in revenues by 30% and operating margins
* Large debt-funded capital expenditure, further weakening capital
structure
Established in 1958, BRKS is engaged in processing and trading of
cashew nuts, raw cashew nuts, cashew nut shell liquid (CNSL),
coffee beans etc. The firm is based in Kukkundoor (Karnataka) with
an installed capacity of 30000 kg per day of cashew. BRKS is owned
& managed by Mr. Bola Raghavendra Kamath and family.
CHOKSEY CHEMICALS: CRISIL Hikes Rating on INR8cr Cash Loan to B+
----------------------------------------------------------------
CRISIL Ratings has upgraded its rating on the long-term bank
facilities of Choksey Chemicals Private Limited (CCPL) to 'CRISIL
B+/Stable' from 'CRISIL B/Stable' and has reaffirmed the short-term
rating at 'CRISIL A4'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Bank Guarantee 2 CRISIL A4 (Reaffirmed)
Cash Credit 8 CRISIL B+/Stable (Upgraded
from 'CRISIL B/Stable')
Letter of Credit 1 CRISIL A4 (Reaffirmed)
Working Capital 0.54 CRISIL B+/Stable (Upgraded
Term Loan from 'CRISIL B/Stable')
Working Capital 1.75 CRISIL B+/Stable (Upgraded
Term Loan from 'CRISIL B/Stable')
The upgrade reflects improvement in business risk profile with
growth in revenue as well as better operating margin. Increase in
revenue was driven by better offtake leading to higher volume
sales. Revenue is estimated at INR55.71 crores in fiscal 2022,
recording a rise of around 28% from INR43.23 crores in fiscal 2021.
Operating margin is estimated at around 5% in fiscal 2022.
Consequently, company's liquidity is expected to improve over the
medium term.
The ratings continue to reflect the leveraged capital structure and
working capital-intensive nature of operations. These weaknesses
are partially mitigated by extensive experience of the promoters in
the chemicals (bulk and polymers) industry, and the diverse
customer base along with moderate debt protection metrics
Analytical Approach
Unsecured loans (outstanding at INR2.12 crore as on March 31, 2022)
extended by the promoters, have been treated as debt as the funds
are unlikely to remain in the business over the medium term.
Key Rating Drivers & Detailed Description
Weaknesses:
* Leveraged capital structure: The total outside liabilities to
adjusted networth (TOLANW) was high at around 24 times as on March
31, 2021. While it has improved in fiscal 2022, it was estimated at
around 15 times as on March 31, 2022. Leveraged capital structure
is primarily on account of low networth base of around 2.3 crore
and reliance on external debt.
* Working capital-intensive operations: Gross current assets (GCAs)
have been high between 190 to 254 days over three fiscals ended
March 31, 2022 primarily on account of high debtors. While there
has been marginal improvement in working capital cycle, operations
continue to remain working capital intensive.
Strengths:
* Extensive industry experience of the promoters and diverse
customer base: The company has been manufacturing waterproofing and
related products for more than three decades. It manufactures a
wide range of construction chemicals and related products and
provides services for the application of its products. Benefits
from the industry experience of the promoter should continue.
Further, company has diverse customer base and has also tied up
with Nippon Paints which is expected to support revenue growth over
medium term.
* Moderate debt protection metrics: Company's debt protection
metrics is moderate indicated by interest coverage ratio and net
cash accruals to adjusted debt estimated at around 2.3 times and
0.09 times for fiscal 2022.
Liquidity: Poor
Company is expected to have limited cushion between net cash
accruals and repayment obligation with accruals expected above INR1
crore against repayment obligation of around INR0.7 crore per annum
over the medium term. Bank limit utilization is moderate at around
78.28% during the 11 months through February 2022. Current ratio
was at 1.30 times for fiscal ended 31st March 2021. The company has
no major debt-funded capex plans over the medium term
Outlook: Stable
CRISIL Ratings believes CCPL should continue to benefit from the
extensive industry experience of the promoter.
Rating Sensitivity factors
Upward factors
* Growth in revenue and steady operating margin of around 5%,
resulting in higher net cash accruals
* Significant improvement in the working capital cycle and capital
structure
Downward factors
* Lower than expected revenue or dip in operating margin resulting
in accruals to repayment obligation remaining below 1.2 times.
* Further stretch in working capital cycle or higher than expected
debt-funded capex weakening the financial risk profile and
liquidity
CCPL was established in 1985, promoted by Mr Girish C Choksey. It
manufactures construction chemicals and concrete admixtures. The
company provides a range of pre- and post-construction chemicals.
It manufactures construction chemicals at its unit in Taloja,
Maharashtra, and concrete admixtures at its facility in Silvassa,
Union Territory of Dadra and Nagar Haveli. It also provides
water-proofing services.
CITRON ECOPOWER: Ind-Ra Affirms 'B' Loan Rating, Outlook Stable
---------------------------------------------------------------
India Ratings and Research (Ind-Ra) has affirmed Citron Ecopower
Private Limited's bank loan ratings as follows:
-- INR2.750 bil. Term loan due on November 30, 2028 affirmed with
IND B/Stable rating; and
-- INR250 mil. Overdraft affirmed with IND B/Stable rating.
Key Rating Drivers
The affirmation reflects Citron's moderate operational performance,
below Ind-Ra's base case expectations.
The generation levels at 18.85% in FY22 (FY21: 18.05%) remained
lower than P90 levels of 21.59%. Wind projects are generally
susceptible to wind speed that could affect their cash flows. In
FYE22, the average grid availability was 94.86% (FY21: 93.49%) and
machine availability was 97.76% (96.71%).
Also, the ratings continue to reflect the lack of significant
improvement in Citron's debt service coverage ratios (below 1x)
since FY19.
Moreover, the project's average receivable days for the group
captive consumers (accounting for around 94% of FY22 revenue)
remained high at 77 days at FYE22 (FY21: 82 days; FY20: 81 days).
However, an improvement was seen in the overall receivable days to
around 75 days in FY22 (FY21: 111 days).
The ratings also remain constrained by the regulatory risk
associated with a group captive business, as any adverse changes in
Electricity Rules, 2005 notified by the Ministry of Power and/or
the regulations notified by Tamil Nadu Electricity Regulatory
Commission may directly impact the project's cash flows.
Liquidity Indicator – Poor: The project still has not created a
debt service reserve account (DSRA), equivalent to two quarters'
debt servicing, depleted in FY19, and hence the lenders have
charged a penal interest of 2%. The sponsor injected INR55 million
in FY22 to support CEPPL for its debt servicing. Management expects
to create the required DSRA after the end of the high wind season
in FY23. Moderate liquidity support of about INR373.5 million
(unrestricted balance) is available at the sponsor level. Also,
Citron's utilization of working capital increased to an average of
41% in FY22 (FY21: 21.89%). The company has unutilized working
capital limits of around INR4.6 million.
The ratings factor in a moderate operational risk for the project,
with contracted operation and maintenance (O&M) expenses being in
line with the base case estimates. Citron has an O&M contract with
Siemens Gamesa Renewable Energy S.A. and Suzlon Energy Limited. The
contracted O&M expenses as per provisional FY22 financials were
INR1. 61 million/MW (FY21: INR1.68 million/MW).
The ratings however continue to be supported by the presence of a
medium-term power purchase agreement for the 66.45MW capacity with
captive consumers, where power is directly sold to industries or
commercial entities and the tariff tracks the state's industrial
tariff. The presence of diversified off-takers for the captive
business reduces the receivable risk to a certain extent. The
balance 9MW was sold to Tamil Nadu Generation and Distribution
Corporation Limited ('IND BBB'/Negative) until March 2022. However,
the company has been selling the entire 75.45MW from April 2022 to
industrial and commercial entities at a tariff of INR6.1/unit,
thereby reducing TANGEDCO exposure to nil from FY23.
Rating Sensitivities
Negative: A significant increase in the operating expenses beyond
Ind-Ra's base case, an increase in the average receivable days by
30 days in FY23 from the current level or any adverse impact on
revenue could lead to a negative rating action.
Positive: A sustained improvement in the internal liquidity and
plant generation could result in a positive rating action.
Company Profile
Incorporated on 8 March 2016, Citron is a special purpose vehicle
that was formed by Leap Green Energy Private Limited to operate two
wind power plants (42.45MW and 33.00MW) in Tamil Nadu.
CLASSIC PROMOTERS: Ind-Ra Cuts Loan Rating to B-, Outlook Negative
------------------------------------------------------------------
India Ratings and Research (Ind-Ra) has downgraded Classic
Promoters and Builders Private Limited's (CPBPL) term loan to 'IND
B-' from 'IND BBB-'. The Outlook is Negative.
The detailed rating action is:
-- INR5,000.1 bil. Term loan due on September 2024 downgraded
with IND B-/Negative rating.
Analytical Approach: Ind-Ra continues to take a consolidated view
of CPBPL and its group concerns, namely Atul Builders ('IND
BB+'/Negative); Jairaj Realty LLP; AC Realty LLP; Renonzo
Developers LLP, Baner Land Development LLP, and M/s Ashok Chordia,
besides Ashdan Developers Private Ltd., Ashdan Township Ventures
Pvt Ltd and Mahalunge Land Developers Pvt Ltd to arrive at the
ratings owing to the strong legal, and moderate operational and
strategic linkages among them. The companies, collectively known as
the Solitaire group, operate in the same line of business and have
a common management and cross-default clauses in their loan
agreements.
The downgrade of instrument rating reflects the deferment of The
Alternative Investment Fund's (AIF) non-convertible debentures
(NCDs) by a further three months to September 14, 2022 from June
14, 2022. Given the deferment was carried out prior to the due date
with the consent of the investors, with terms which do not lead to
a loss to the investors and Ind-Ra's assessment that the company
had liquidity to repay before it sought deferment, this has not
been treated as a default under the Distressed Debt Exchange
criteria. The instrument rating also reflects regular repayments in
all other bank/non-bank financial company facilities by CPBPL.
The Negative Outlook reflects lower-than-projected land deal
receipts and lower collections than anticipated. CPBPL had earlier
deferred the NCD repayment to June 2022 from December 2021 to match
the date of commencement of commercial operations of the projects
with the loan repayments. Due to adequate liquidity, Ind-Ra had
similarly not construed this as a default then and had affirmed the
ratings while revising the outlook to Negative.
Key Rating Drivers
The Solitaire group had over the last three months purchased
parcels of land through NNP Constructions (its group company) with
a back-to-back arrangement to sell the same to a leading real
estate counterparty. As per the terms of the entire transaction,
the property purchased would have to be initially funded by the
Solitaire group, and then paid for by the counterparty in phases
upon achievement of certain milestones. CPBPL had been in
negotiations with AIF for part funding the above transaction. The
company has informed the agency that AIF had agreed to extend the
NCD repayment for a period of three months instead of sanctioning a
fresh NCD.
Liquidity Indicator - Poor: Liquidity is poor given the shortfall
in cash flows at CPBPL, and the deployment of the group's liquidity
for land purchase. CPBPL had access to liquidity of INR1.7 billion
from sales as of April 12, 2022 (the date on which the request to
extend the NCD was placed), which was subsequently deployed for
land purchase in a group company with the consent of the company's
lender. During April 2022 until June 15, 2022, the group collected
INR2.91 billion from sales which was lower than projected.
Rating Sensitivities
Positive: Any improvement in liquidity by way of improved
collections and/or liquidity support from land deals would result
in the Outlook revision to Stable.
Negative: Any deterioration in liquidity by way of
lower-than-expected collections and/or lower liquidity support from
land deals would be negative for the ratings.
Company Profile
Incorporated in 1988, CPBPL, a flagship company of the Solitaire
Group, executes luxurious residential and commercial projects in
Pune. The group's overall operations are managed by its promoter
Ashok Dhanraj Chordia and his son Atul Chordia. The group is
involved in real estate development business and Transfer of
Development Rights business, hospitality and textile business. It
also generates lease/rental income by leasing out its developed
properties. The group has eight ongoing and six upcoming projects.
DOLPHIN PROMOTERS: CRISIL Cuts Rating on INR19cr LT Loan to D
-------------------------------------------------------------
CRISIL Ratings has downgraded its rating on the bank facilities of
Dolphin Promoters and Builders (DPB) to 'CRISIL D Issuer Not
Cooperating' from 'CRISIL B+/Stable Issuer Not Cooperating' based
on publicly available information.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Long Term Loan 19 CRISIL D (ISSUER NOT
COOPERATING; Downgraded from
'CRISIL B+/Stable ISSUER NOT
COOPERATING')
CRISIL Ratings has been consistently following up with DPB for
obtaining information through email dated January 26, 2021, July 9,
2021 and July 6, 2022, 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
Ratings failed to receive any information on either the financial
performance or strategic intent of DPB, which restricts CRISIL
Ratings' ability to take a forward-looking view on the entity's
credit quality. CRISIL Ratings believes that rating action on DPB
is consistent with 'Assessing Information Adequacy Risk'.
DPB is a partnership firm, established in August 2003. It
undertakes real estate development for residential and commercial
projects in Raipur, Chhattisgarh. The firm is currently developing
two residential projects with aggregate saleable area of about 6
lakh square feet.
DOSHION WATER: Insolvency Resolution Process Case Summary
---------------------------------------------------------
Debtor: M/s. Doshion Water Umbrella (Cuddalore) Private Limited
Registered office:
Building No. 9 10, Sigma Corporate
Behind Rajpath Club
Off. S.G. Road
Bodakdev Ahmedabad 380054
Principal office:
A-103/10, Tirth Bhumi Apartment
Nr. Law Garden Ellisbridge
Ahmedabad 380006
Insolvency Commencement Date: July 6, 2022
Court: National Company Law Tribunal, Ahmedabad Bench
Estimated date of closure of
insolvency resolution process: January 3, 2023
(180 days from commencement)
Insolvency professional: Mr. Chandra Prakash Jain
Interim Resolution
Professional: Mr. Chandra Prakash Jain
D-501, Ganesh Meridian
Opp. Gujarat High Court
S.G. Road, Ahmedabad 380060
E-mail: jain_cp@yahoo.com
cirp.doshionwater@gmail.com
Last date for
submission of claims: July 20, 2022
ELYSIUM PHARMACEUTICALS: Ind-Ra Hikes LT Issuer Rating to 'BB+'
---------------------------------------------------------------
India Ratings and Research (Ind-Ra) has upgraded Elysium
Pharmaceuticals Limited's (EPL) Long-Term Issuer Rating to 'IND
BB+' from 'IND BB'. The Outlook is Stable.
The instrument-wise rating actions are:
-- INR293 mil. Term loan due on June 2024 upgraded with IND BB+/
Stable rating;
-- INR710 mil. (increased from INR270 mil.) Fund-based limits
upgraded with IND BB+/Stable rating; and
-- INR40.1 mil. (increased from INR17 mil.) Non-fund-based limits
affirmed with IND A4+ rating.
The upgrade reflects the improvement in EPL's revenue (91.66% yoy),
EBITDA margins and credit metrics in FY21.
Key Rating Drivers
The company's scale of operations remains medium, despite its
revenue rising to INR1,605.45 million in FY21 (FY20: INR837.64
million) on the back of an increase in exports due to a growing
demand for its products in the international market. The revenue
further improved to INR1,901 million in FY22, based on provisional
key financials, due to the introduction of new products along with
a sustained demand. The scale of operations however remains medium.
The management expects the sales to continue to grow over the
medium term, due to a continued increase in the demand.
Furthermore, the company's EBITDA margin are healthy and improved
to an average 28.89% in FY21 (FY20: 27.34%) due to an increase in
the sales of high-margin products and a decline in personnel and
administrative expenses. The return on capital was 30.4% in FY21
(FY20: 14.1%). EBITDA margin were around 29.02% in FY22. In the
short term, Ind-Ra expects the EBITDA margin to remain at a similar
level on a similar revenue share of the higher margin segment.
Moreover, the credit metrics improved substantially, but remained
at modest levels. In FY21, EPL's interest coverage (operating
EBITDA/gross interest expense) was 10.61x (FY20: 4.44x) and net
leverage (net debt/operating EBITDA) was 1.21x (2.32x). The
improvement in the metrics was owing to a significantly higher
absolute EBITDA (FY21: INR463.74 million, FY20: INR228.97 million)
than debt and interest obligations due to its size of operations
achieved during FY21. According to FY22 key provisional financials,
the net leverage was 0.62x and interest coverage was 15.63x. In the
short term, Ind-Ra expects the credit metrics to improve further
due to an expected improvement in absolute EBITDA, considering the
absence of any major debt-led capex.
Liquidity Indicator – Stretched: The cash and cash equivalents
stood at INR56.37 million at end-FY21 (FY20: INR20.36 million). The
company had cash and cash equivalents of INR5.24 million at FYE22.
EPL has debt repayment obligations of around INR87 million in FY23
and INR70 million in FY24. EPL's average maximum utilization of the
fund-based limits remained low at 13.81% during the 12 months ended
April 2022. The cash flow from operations deteriorated slightly to
INR71.35 million in FY21 (FY20: INR72.01 million) due to adverse
changes in working capital. Furthermore, the free cash flow
deteriorated to negative INR29.33 million (FY20: INR10.16 million).
The net working capital cycle remained elongated and increased to
147 days in FY21 (FY20: 144 days) due to higher inventory days of
72 days (45 days), lesser debtor days of 129 days (187 days) and
lesser creditor days of 54 days (88 days). In FY22, EPL had
outstanding receivables of around INR1,200 million, resulting from
delays in the delivery of orders in the wake of COVID-19-led
disruptions. However, EPL does not have any capital market exposure
and relies on banks and financial institutions to meet its funding
requirements.
The ratings continue be constrained by the customer concentration
risk, as the top three customers accounted for around 50% of the
FY22 total export sales. The company's exports accounts for 95% of
its total sales and hence any regulatory changes in the exporting
countries can affect the earnings of the company.
The ratings continue to be supported by the promoter's experience
of over two decades in generic drug manufacturing.
Rating Sensitivities
Positive Substantial growth in the scale of operations, along with
an improvement in the overall credit metrics and liquidity profile,
all on a sustained basis, could lead to a positive rating action.
Negative: A dip in the scale of operations, leading to
deterioration in the credit metrics, or a stretch in the liquidity
position, all on a sustained basis could lead to negative rating
action.
Company Profile
Incorporated in 1995 by Yashwant Patel, EPL manufactures sterile
formulations such as liquid and dry parenteral and non-sterile
formulations such as tablets, capsules, liquid orals, ointment and
dry syrups under third-party and contract manufacturing agreements
for established pharmaceutical firms. The company is based out of
Dabhasa, 19km from Vadodara, Gujarat. The company commenced
commercial operations in 1997.
FATEH CHAND: Ind-Ra Moves BB+ Bank Loan Rating in Non-Cooperating
-----------------------------------------------------------------
India Ratings and Research (Ind-Ra) has migrated Fateh Chand
Charitable Trust's (FCCT) bank facilities to the non-cooperating
category. The issuer did not participate in the rating exercise
despite continuous requests and follow-ups by the agency.
Therefore, investors and other users are advised to take
appropriate caution while using these ratings. The rating will now
appear as 'IND BB+ (ISSUER NOT COOPERATING)' on the agency's
website.
The instrument-wise rating actions are:
-- INR76.4 mil. Term loan due on March 2023 migrated to non-
cooperating category with IND BB+ (ISSUER NOT COOPERATING)
rating; and
-- INR42.8 mil. Non-fund-based bank facilities (bank guarantee)
migrated to non-cooperating category with IND BB+ (ISSUER NOT
COOPERATING) rating.
Note: ISSUER NOT COOPERATING: The ratings were last reviewed on May
3, 2021. Ind-Ra is unable to provide an update as the agency does
not have adequate information to review the ratings.
Company Profile
Established in 2005, FCCT is chaired by Satish C. Goel and is
affiliated to the Chaudhary Charan Singh University, Meerut.
Approved by Medical Council of India, Muzaffarnagar Medical College
and Hospital, under FCCT's aegis, started its operations in 2006.
The courses offered are MBBS, post-graduation along with
para-medical courses to impart nursing education and training. The
hospital, presently with a capacity of 700 beds, was established
primarily to support the college as a teaching hospital.
FUTURE LIFESTYLE: CRISIL Reaffirms D Rating on INR500cr NCD
-----------------------------------------------------------
CRISIL Ratings has downgraded its ratings on the bank loan
facilities of Future Lifestyle Fashions Ltd (FLFL) to 'CRISIL
D/CRISIL D' from 'CRISIL C/CRISIL A4'. CRISIL Ratings has also
reaffirmed its 'CRISIL D' rating on the non-convertible debentures
(NCDs).
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Long Term Rating - CRISIL D (Downgraded from
'CRISIL C')
Short Term Rating - CRISIL D (Downgraded from
'CRISIL A4')
Non Convertible
Debentures 500 CRISIL D (Reaffirmed)
The downgrade reflects default on ~Rs 335 crore bank loans as
disclosed by FLFL to the Bombay Stock Exchange (BSE) on July 1,
2022 (BSE disclosure). The ratings remain constrained by the tight
liquidity position of the company.
Analytical Approach
For arriving at the ratings, CRISIL Ratings has combined the
business and financial risk profiles of FLFL and all its
subsidiaries, given their common business. Also, the company's
networth has been adjusted for revaluation reserve.
Key Rating Drivers & Detailed Description
Weakness:
* Stretched liquidity with substantially high debt obligation:
The company's liquidity was constrained on account of severe impact
on cash flow following the Covid-19 pandemic. This weakened its
debt protection metrics since fiscal 2021 and consequently, the
company applied for one-time restructuring plan for its bank loans
with its lenders under the guidelines issued by the Reserve Bank of
India (RBI). The restructuring plan was implemented on April 30,
2021.
Additionally, in the past few months, Reliance entities have
terminated its sub-lease to FLFL on ~112 of its stores that have
historically contributed to around 55-65% of the retail revenue
operations of the company. As per the disclosure on BSE dated March
9, 2022, by FLFL, these stores are not operational for stock and
inventory reconciliation. This, along with an already tight working
capital position, has also impacted the liquidity position of the
company.
The company had scheduled bank loan servicing obligation of around
INR335 crore (as of June 30, 2022 as per the BSE disclosure by
FLFL). Although the interest due and payable on the bank loan
facilities has been paid up to June 30, 2022, the company could not
meet its principal repayment obligation to the extent of around
INR335 crore.
The scheduled servicing for NCDs has been regular after the
restructuring in April 2021.
* Weakened operating efficiency: High operating leverage impacted
the operating profitability last fiscal and in the first quarter of
fiscal 2022. However, in the second quarter of fiscal 2022, sales
picked up gradually, thereby lowering losses. Also,
cost-optimization initiatives, including reduction of fixed
overheads and store optimization, resulted in improvement in
liquidity. However, the recent takeover of some of the stores by
Reliance entities and the stretch in the working capital cycle are
expected to have an adverse impact on the operations of the
company.
Strengths:
* Established position in the past in the departmental stores
segment: The company has historically been one of the largest
players in the domestic departmental store format. However, this
has been impacted on account of the takeover of some of its stores
by Reliance entities and a tight liquidity position.
Liquidity: Poor
Due to the pandemic, cash flow to service debt was severely
impacted. Working capital lines are almost fully utilized. FLFL had
defaulted in November 2020, which were later restructured in April
2021. There has been no default under the NCDs after the
restructuring.
The company has defaulted on its bank loan servicing in the first
quarter of fiscal 2023. FLFL plans to take necessary steps to
further restructure its debts and fulfill other commitments as
agreed with the lenders under the one-time restructuring plan as
per its BSE disclosure.
Rating Sensitivity factors
Upward factors
* Repayment of entire overdue amount along with track record of
timely servicing of debt
* Sustained improvement in the financial risk profile with debt
service coverage ratio of over 1.1 times
Incorporated in 2012, FLFL is the apparel retail venture of the
Future group. It was established by combining apparel retail
formats and fashion brands that were demerged from Pantaloon Retail
India Ltd and Future Ventures India Ltd, respectively.
The company has a portfolio of brands that cover a range of fashion
categories, including apparel and footwear. It has Central and
Brand Factory stores, along with exclusive Brand Factory outlets.
Central operates primarily in the premium apparel, footwear,
watches and fashion accessories segment, while Brand Factory
operates mainly in the off-price apparel retailing (discount-based)
segment.
GANPATI AGRI: Ind-Ra Affirms BB+ LT Issuer Rating, Outlook Stable
-----------------------------------------------------------------
India Rating and Research (Ind-Ra) has affirmed Ganpati Agri
Business Pvt Ltd.'s (GABPL) Long-Term Issuer Rating at 'IND BB+'.
The Outlook is Stable.
The instrument-wise rating action are:
-- INR320 mil.(increased from INR170 mil.) Fund-based working
capital limit affirmed with IND BB+/Stable rating;
-- INR134.54 mil. (increased from INR37.82 mil.) Term loan due on
March 2028 affirmed with IND BB+/Stable rating;
-- INR115 mil. Proposed fund-based working capital limit assigned
with IND BB+/Stable rating; and
-- INR20 mil. Proposed term loan assigned with IND BB+/Stable
rating.
Key Rating Drivers
The affirmation reflects GABPL's continued weak credit metrics. In
FY22, the interest coverage (Operating EBITDA/Gross Interest
Expense) was marginally improved to 2.7x (FY21: 2.1x) and the net
leverage (Total Adjusted Net Debt/Operating EBITDAR) was reduced to
7.7x (8.7x), due to an increase in the absolute EBITDA to INR72.9
million (INR57.9 million). As of March 31, 2022, GABPL's interest
free unsecured loans from directors/ shareholders was increased to
INR110.1 million (FY21: INR109.0 million) and State Bank of India
('IND AAA'/Stable) prior approval is required for the repayment of
unsecured loans. The management expects the unsecured loans to
increase by INR30 million in FY23 due to the increase in its
revenue. GABPL has no major debt-led capex plans in the next two
years. GABPL plans to install a refinery of vegetable oil at a cost
of around INR500 million by FY25, of which INR150 million would be
internal accruals and the balance would be external borrowings.
Ind-Ra expects the credit metrics to remain weak in FY23, on
account of an increase in the unsecured loans.
The ratings also reflect GABPL's continued modest EBITDA margins in
FY22 of 3.15% (FY21: 3.07%) with a return on capital employed of
6.4% (5.9%) due to its control on the operating expenses. Ind-Ra
expects the company's EBITDA margin to marginally improve in FY23,
due to its control on the operating expenses.
Liquidity Indicator-Stretched: The company's average utilization of
the fund-based limits was 94.2% in the 12 months ended May 2022.
Also, the temporary over draft (TOD) of INR7.5 million was taken
and repaid by GABPL to Bank of Baroda for August, November,
December of 2021 and January 2022. At FYE22, the cash and cash
equivalent was INR20.7 million (FY21: INR15.9 million). In FY22,
the cash flow from operations turned positive at INR22.3 million
(FY21: negative INR79.6 million), due to a favorable change in the
working capital. In FY22, the net cash conversion cycle was
improved to 71 days (FY21: 83 days) on account of a reduction in
inventory holding period to 31 days (58 days), due to the timely
execution of orders in hand.
GABPL has a medium scale of operations with its revenue increasing
to INR2,315.1 million in FY22 (FY21: INR1,884.5 million), due to an
increase in work orders lead by the addition of new customers along
with continued repeat orders. Ind-Ra expects GABPL revenue to rise
further in FY23, due to an increase in existing capacity
utilization (FY22: 81%; FY21: 67%) and the revenue generation from
new menthol plant which started production in April 2022.
The ratings are constrained by GABPL's moderate customers
concentration risk as top 10 customers accounted for around 66% of
the total sales in FY22, of which top three customers contributed
around 39% to its total sales. Further, the company's does not have
any exposure to the capital market and relies on a single bank to
meet its funding requirements.
The ratings continue to be supported by its promoters' nearly two
decades of experience in the vegetable oil, poultry and cattle feed
industry, leading to established relationships with its customers
and suppliers.
Rating Sensitivities
Negative: Any deterioration in the scale of operations or weakening
of the credit profile or the liquidity position, will be negative
for the ratings.
Positive: A significant improvement in the scale of operations,
leading to a fall in the net leverage below 3.5x and an improvement
in the liquidity position, will be positive for the ratings.
Company Profile
GABPL was incorporated in 2011 by Atul Kumar Singh and his wife
Anjali Singh, who are both directors. The company manufactures rice
bran oil (unfinished cooking oil) and its by-products, de-oiled
rice bran cake along with allied products such as mustard cake,
de-oiled mustard cake, among others for poultry and cattle feed.
GINNI FILAMENTS: CRISIL Withdraws B+ Rating on INR18.18cr Loan
--------------------------------------------------------------
CRISIL Ratings has withdrawn its rating on the bank facilities of
Ginni Filaments Limited (GFL) on the request of the company and
after receiving no objection certificate from the bank. The rating
action is in-line with CRISIL Rating's policy on withdrawal of its
rating on bank loan facilities.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Bank Guarantee 0.63 CRISIL A4/Issuer Not
Cooperating (Withdrawn)
Bank Guarantee 0.40 CRISIL A4/Issuer Not
Cooperating (Withdrawn)
Bill Discounting 10.00 CRISIL A4/Issuer Not
Cooperating (Withdrawn)
Cash Credit 18.18 CRISIL B+/Stable/Issuer Not
Cooperating (Withdrawn)
Cash Credit 50 CRISIL B+/Stable/Issuer Not
Cooperating (Withdrawn)
Cash Credit 8.2 CRISIL B+/Stable/Issuer Not
Cooperating (Withdrawn)
Export Packing 12 CRISIL A4/Issuer Not
Credit Cooperating (Withdrawn)
Letter of Credit 0.94 CRISIL A4/Issuer Not
Cooperating (Withdrawn)
Letter of Credit 11.25 CRISIL A4/Issuer Not
Cooperating (Withdrawn)
Letter of Credit 7.00 CRISIL A4/Issuer Not
Cooperating (Withdrawn)
Letter of Credit 2.97 CRISIL A4/Issuer Not
Cooperating (Withdrawn)
Term Loan 1.82 CRISIL B+/Stable/Issuer Not
Cooperating (Withdrawn)
CRISIL Ratings has been consistently following up with GFL for
obtaining information through letters and emails dated November 21,
2020 and May 19, 2021 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
Ratings failed to receive any information on either the financial
performance or strategic intent of GFL. This restricts CRISIL
Ratings' ability to take a forward looking view on the credit
quality of the entity. CRISIL Ratings believes that rating action
on GFL is consistent with 'Assessing Information Adequacy Risk'.
CRISIL Ratings has Continues the ratings on the bank facilities of
GFL to 'CRISIL B+/Stable/CRISIL A4 Issuer not cooperating'.
GFL, incorporated in 1982 and promoted by Mr. Rajaram Jaipuria and
Mr. Shishir Jaipuria, is an integrated textile manufacturer. It
commenced operations in 1990 and has two divisions: textiles and
consumer products. In the textile division, it produces yarn,
fabrics, non-woven fabrics, and garments. Its consumer products
include wet wipes, medical disposables, and wound-care products.
GFL has production facilities in Panoli (Gujarat), Mathura (Uttar
Pradesh), Haridwar (Uttarakhand), and Noida (Uttar Pradesh).
GONGLU AGRO: Insolvency Resolution Process Case Summary
-------------------------------------------------------
Debtor: Gonglu Agro Private Limited
No. 1B & 1C, Sivanandham Apartments
4th Floor, 4A, East Park Road
Pulla Avenue, Shenoy Nagar
Chennai, Tamil Nadu 600030
Insolvency Commencement Date: May 30, 2022
Court: National Company Law Tribunal, Mumbai, Maharashtra Bench
Estimated date of closure of
insolvency resolution process: November 26, 2022
Insolvency professional: Mr. Lalit Kumar Dangi
Interim Resolution
Professional: Mr. Lalit Kumar Dangi
104, M.K. Bhavan
300 Shahid Bhagat Singh Road
Fort, Mumbai City 400001
Maharashtra
E-mail: lalitkumardangi@gmail.com
- and -
B-526, Chintamani Plaza
Near W.E. Highway Metro Station
Andheri Kurla Road, Andheri (East)
Mumbai 400099
E-mail: cirp.gongluagro@gmail.com
Last date for
submission of claims: June 13, 2022
INCI CONSTRUCTION: CRISIL Lowers Rating on Long Term Debt to D
--------------------------------------------------------------
CRISIL Ratings has downgraded its ratings on the bank facilities of
INCI Construction and Interiors Private Limited (ICIPL) to 'CRISIL
D/CRISIL D Issuer Not Cooperating' from 'CRISIL B+/Stable/CRISIL A4
Issuer Not Cooperating' based on publicly available information.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Long Term Rating - CRISIL D (ISSUER NOT
COOPERATING; Downgraded from
'CRISIL B+/Stable ISSUER NOT
COOPERATING')
Short Term Rating - CRISIL D (ISSUER NOT
COOPERATING; Downgraded from
'CRISIL A4 ISSUER NOT
COOPERATING*')
CRISIL Ratings has been consistently following up with INCI
Construction and Interiors Private Limited (ICIPL) for obtaining
information through letters and emails dated January 22, 2022 and
March 12, 2022 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
Ratings failed to receive any information on either the financial
performance or strategic intent of ICIPL, which restricts CRISIL
Ratings' ability to take a forward-looking view on the entity's
credit quality. CRISIL Ratings believes that rating action on ICIPL
is consistent with 'Assessing Information Adequacy Risk'.
Incorporated in 2006, ICIPL undertakes interior designing projects
and construction projects. It is also engaged in manufacturing of
furniture. The company is based out of Chennai and is promoted by
Mr. T Sarvanan.
J M J CHARITABLE: Ind-Ra Moves 'BB' Loan Rating to Non-Cooperating
------------------------------------------------------------------
India Ratings and Research (Ind-Ra) has migrated J M J Charitable
Education Society's bank loan rating to the non-cooperating
category. The issuer did not participate in the rating exercise
despite continuous requests and follow-ups by the agency.
Therefore, investors and other users are advised to take
appropriate caution while using these ratings. The rating will now
appear as 'IND BB (ISSUER NOT COOPERATING)' on the agency's
website.
The detailed rating action is:
-- INR200 mil. Bank loans migrated to the non-cooperating
category with IND BB (ISSUER NOT COOPERATING) rating.
Note: ISSUER NOT COOPERATING: The rating was last reviewed on June
1, 2021. Ind-Ra is unable to provide an update as the agency does
not have adequate information to review the ratings.
Company Profile
JMJCES was established on May 16, 2013 under the Registrar of
Societies, Rajajinagar, Bengaluru Urban district. The Acharya
Institute of Management & Sciences was initially under the
management of J M J Education Society (debt rated at 'IND
BBB-'/Stable). All the Acharya institutes managed under JMJES were
transferred to Soldevanahalli, Bengaluru, except JMJCES, which was
remained as the Peenya campus, Bengaluru.
JAMES & CO: Ind-Ra Moves BB- LT Issuer Rating to Non-Cooperating
----------------------------------------------------------------
India Ratings and Research (Ind-Ra) has migrated James & Co's
Long-Term Issuer Rating to the non-cooperating category. The issuer
did not participate in the rating exercise despite continuous
requests and follow-ups by the agency. Therefore, investors and
other users are advised to take appropriate caution while using
these ratings. The rating will now appear as 'IND BB-(ISSUER NOT
COOPERATING)' on the agency's website.
The instrument-wise rating actions are:
-- INR26.7 mil. Term loan due on October 2025 migrated to non-
cooperating category with ND BB- (ISSUER NOT COOPERATING)
rating; and
-- INR96 mil. Fund-based limits migrated to non-cooperating
category with IND BB- (ISSUER NOT COOPERATING)/IND A4+
(ISSUER NOT COOPERATING) rating.
Note: ISSUER NOT COOPERATING: The ratings were last reviewed on May
24, 2021. Ind-Ra is unable to provide an update, as the agency does
not have adequate information to review the ratings.
Company Profile
Incorporated in 2002, James and Co is engaged in retailing
electrical, electronic goods and furniture items, and has 10 retail
outlets in south Tamil Nadu. The firm was started and led by James
Kanikkaraj.
JAMES RETAIL: Ind-Ra Moves BB- LT Issuer Rating to Non-Cooperating
------------------------------------------------------------------
India Ratings and Research (Ind-Ra) has migrated James Retail
Private Limited's Long-Term Issuer Rating to the non-cooperating
category. The issuer did not participate in the rating exercise
despite continuous requests and follow-ups by the agency.
Therefore, investors and other users are advised to take
appropriate caution while using these ratings. The rating will now
appear as 'IND BB- (ISSUER NOT COOPERATING)' on the agency's
website.
The instrument-wise rating actions are:
-- INR40 mil. Term loan due on March 2023 migrated to non-
cooperating category with IND BB- (ISSUER NOT COOPERATING)
rating; and
-- INR90 mil. Fund-based limits migrated to non-cooperating
category with IND BB- (ISSUER NOT COOPERATING)/IND A4+
(ISSUER NOT COOPERATING) rating.
Note: ISSUER NOT COOPERATING: The ratings were last reviewed on May
27, 2021. Ind-Ra is unable to provide an update, as the agency does
not have adequate information to review the ratings.
Company Profile
Incorporated in 2018, James Retail is engaged in retailing
electrical, electronic goods and furniture items. The firm has
three retail outlets in Tamil Nadu's Madurai and Virudunagar
regions.
JANA CAPITAL: Ind-Ra Affirms 'B+' Non-Convertible Debt Rating
-------------------------------------------------------------
India Ratings and Research (Ind-Ra) has taken the following rating
actions on Jana Capital Limited's (JCL) non-convertible debentures
(NCDs):
-- INR1.5 mil. NCDs issued on October 30, 2019 coupon rate 5% due
on May 31, 2023 affirmed with IND B+/Stable rating; and
-- INR1.0 mil. NCD^ assigned with IND B+/Stable rating.
^Yet to be issued
Analytical Approach: To arrive at the ratings, Ind-Ra continues to
take a consolidated view of the credit profiles of JCL and Jana
Holdings Limited (JHL; debt rated 'IND B+'/Stable) and consider the
parent-subsidiary linkage to arrive at the rating of the holding
company of Jana Small Finance Bank (JSFB). JCL, a non-deposit
taking non-bank finance company-core investment company, holds 100%
stake in JHL. JHL has limited financial strength. It is a
non-operating financial holding company of JSFB (42.84% stake held
by JHL) and the value of its investments is derived solely from its
shareholding in JSFB. The value of the stake in JSFB is largely
subject to the bank's incremental performance (banking operations
commenced in March 2018) and its ability to manage the credit
costs.
The rated INR1.0 billion NCDs, issued to TPG Asia VI India Markets
Pte. Ltd, are junior to all other issues raised by JHL.
Nevertheless, the NCDs raised by JHL and JCL have a cross-default
clause with JHL's indebtedness. The NCDs are created in the favor
of Catalyst Trusteeship Limited and are subservient to the first
ranking pledge created for the benefit of the holders of the NCDs
issued by JHL over the equity shares of JSFB held by JHL until the
senior instruments are paid-off on their due dates.
A common independent director serving on the boards of JCL and
Ind-Ra did not participate in the rating process.
Key Rating Drivers
COVID-19 Continues to Weigh on JSFB's Asset Quality: JSFB's asset
quality, which improved when its gross non-performing assets
(GNPAs) had reduced to 3.2% in FY20 (FY19: 8.1%) on account of
reported write-downs of INR3 billion, came under pressure amid the
first and the second waves of COVID-19. The GNPAs increased to 7.2%
in March 2021 and slightly improved to 5% in March 2022. Also, the
provision coverage ratio including technical write-offs was at 87%
and excluding technical write-offs was at 32% 32.2% at end-March
2022 (end-March 2021: 27.9%). The bank has made lower provisions on
incremental GNPAs as it expects material recoveries or limited loss
given defaults over the near term. Also, about 4% of the portfolio
was restructured for JSFB at end-March 2022. In case recoveries do
not pan out as per the bank's expectations, JSFB could see
incremental credit costs (4%-8%) in FY23 on unsecured loans; share
of unsecured at end-FY22 was 50%. Also, the collection efficiencies
& recoveries picked up in the unsecured segment in 2HFY22,
supported by the gradual relaxation of state-wise lockdowns.
Near-term Profitability for JSFB may Remain Constrained due to High
Credit Costs: JSFB's net profit fell to INR54 million in FY22
(FY21: INR843 million), due to an increase in the credit costs to
INR5.7 billion (INR3.7 billion). Furthermore, the bank could face
continued high credit costs amid the lingering effects of the
COVID-19-led lockdowns and low provisions, which could impact its
profitability at least over the medium term. Under stress case, the
effects of the scale and repricing of deposits at lower levels
could be offset by incremental credit costs.
High Refinancing and Valuation Risks for Holding Companies: The
issued NCDs face refinancing risks. The NCDs need to be refinanced
to the extent of the principal and the rate of return promised to
the investors. While the refinancing risk is not immediate, JCL's
NCDs have a cross-default clause with the existing indebtedness of
JHL. JHL has successfully refinanced its NCDs which were falling
due in December 2021 and January 2022. JCL and JHL do not have any
NCD due until May 2023. Furthermore, an increase in JHL's
shareholding, on account of the proposed infusion, alone might be
insufficient to repay the existing obligations; hence, the
valuation risk is significant and depends on the bank's standalone
performance.
Raising Funds over Near-term Crucial: At FYE22, JSFB reported a
tier 1 capital ratio of 11.83% (FYE21: 11.75%) and a total capital
adequacy ratio of 15.26% (15.51%) which are lower than its peers'.
Furthermore, given the bank's low provisioning levels, its net
NPA/equity stood high at 42.7% at end-March 2022 (end-March 2021:
54%) and hence the bank would need to build higher capital buffers,
especially if the recovery slows. JSFB had disclosed in the Draft
Red Herring Prospectus filed with the Securities & Exchange Board
of India in March 2021 that it will undertake a total capital raise
of INR7 billion as part of pre-IPO and the IPO. The new NCDs which
the JCL is raising could be utilized for a capital infusion in JSFB
and is crucial over the near term. Also, JSFB has been supported by
regular equity infusions in the past from investors. The bank had
raised INR3.4 billion equity in FY20, INR10.9 billion in FY19 and
INR16.4 billion in FY18 from existing and new investors. As per the
licensing guidelines, the bank was going to list itself on the
stock exchanges by March 2021. However, it has delayed due to the
pandemic and is under process.
Liquidity Indicator for JCL - Poor: JCL does not have cash flows to
service its debt obligations and will have to depend on the
monetization of its stake in JSFB or the secondary sale of shares,
among other options, before the maturity date of the respective
instruments. JHL is in the process of listing the bank. JHL and JCL
are also getting merged and. Ind-Ra expects this merger to be
completed over the near term. Furthermore, the debt raised by both
the holding companies are in the form of zero-coupon bonds that
would have lumpy pay-outs on maturity, adding to the liquidity
demands.
Liquidity Indicator for JSFB – Adequate; Deposits Continue to See
Traction: The bank's liquidity coverage ratio stood at 555.1% at
FYE22 (1,199.67% at FYE21). Basis the bank's asset liability
mismatch statement at end-March 2022, there were no cumulative
mismatches for the period of up to one year. JSFB has also been
able to mobilize deposits, with the term deposits increasing to
INR104.8 billion in FY22 (FY21: INR103.1 billion; FY20: INR89.4
billion), and the current and savings accounts to INR30.5 billion
(INR20.8 billion; INR7.1 billion). The total deposits stood at
INR135.4 billion at end-March 2022, and 96% of the term deposits
have a tenor of more than one year. Given the substantial traction
in low-cost deposits, the cost of funds for JSFB also improved to
7.6% in FY22 (FY11: 8.3%; FY20: 9.4%, FY19: 10.2%).
Portfolio Mix Changing in Favor of Secured Loans: JSFB is
strategically shifting towards a secured loan portfolio and the
share of secured portfolio in its portfolio increased to 50% at
end-March 2022 from 25% at end-March 2020. JSFB has also been
lowering its group loan exposure continuously (FY22: 11%; FY20:
around 46%). Ind-Ra believes the group loan portfolio will continue
to decline with the share of secured portfolio going up. Ind-Ra
believes this will improve the asset quality of the bank over the
medium term.
Rating Sensitivities
Positive: A timely successful merger with JHL and raising of funds
as planned could lead to a positive rating action. A significant
improvement in the bank's asset quality, the capitalization and
leverage (advances to equity) and an achievement of material
profitability earlier than as expected by the agency could also
result in a positive rating action.
Negative: A negative rating action could result from:
- inability to raise adequate funds before refinancing is due;
- a sustained weakness in the bank's asset quality, its capital
levels close to the regulatory minimum consistently or a weakness
in the deposit/liquidity profile; and
- any unrelated diversification of the holding company, although
unlikely.
ESG Issues
ESG Factors Minimally Relevant to Rating: Unless otherwise
disclosed in this section, the ESG issues are credit neutral or
have only a minimal credit impact on JCL, due to either their
nature or the way in which they are being managed by the entity.
For more information on Ind-Ra's ESG Relevance Disclosures, please
click here.
Company Profile
JCL was incorporated on March 26, 2015 to carry on the business of
an investment company and to invest, buy, sell or deal in any
share, stock, and debenture. The company received a certificate of
registration dated 24 March 2017 from the Reserve Bank of India as
a non-banking financial institution – non-deposit taking –
systematically important core investment company under section 45IA
of the Reserve Bank of India Act, 1934. JSFB had total advances of
INR116 billion and a diversified presence across 25 states and
union territories in India at end-March 2022.
KAMAL AND COMPANY: CRISIL Moves B Debt Rating to Not Cooperating
----------------------------------------------------------------
CRISIL Ratings has migrated the rating on bank facilities of Kamal
and Company (KC) to 'CRISIL B/Stable Issuer not cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 5 CRISIL B/Stable (ISSUER NOT
COOPERATING; Rating Migrated)
CRISIL Ratings has been consistently following up with KC for
obtaining information through letters and emails dated May 23,
2022, June 22, 2022 and June 27, 2022 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
Ratings failed to receive any information on either the financial
performance or strategic intent of KC, which restricts CRISIL
Ratings' ability to take a forward-looking view on the entity's
credit quality. CRISIL Ratings believes that rating action on KC is
consistent with 'Assessing Information Adequacy Risk'. Therefore,
on account of inadequate information and lack of management
cooperation, CRISIL Ratings has migrated the rating on bank
facilities of KC to 'CRISIL B/Stable Issuer not cooperating'.
KC was established in 1936 as a proprietorship firm and was later
reconstituted as a partnership firm. It is an authorized dealer of
vehicles of Tata Motors Ltd (TML). The firm has a showroom and two
service centres in Jaipur and has been appointed sub dealer in
Dausa and Kothputli in Rajasthan. KC is owned and managed by Mr
Dayanidhi Kasliwal, Mr Ishnidhi Kasliwal, Mr Deshnidhi Kasliwal, Mr
Payonidhi Kasliwal and Mr Sudhanidhi Kasliwal.
KASHIPUR INFRASTRUCTURE: Ind-Ra Keeps BB Rating in Non-Cooperating
------------------------------------------------------------------
India Ratings and Research (Ind-Ra) has maintained Kashipur
Infrastructure and Freight Terminal Private Limited's Long-Term
Issuer Rating in the non-cooperating category. The issuer did not
participate in the rating exercise despite continuous requests and
follow-ups by the agency. Therefore, investors and other users are
advised to take appropriate caution while using these ratings. The
rating will now appear as 'IND BB (ISSUER NOT COOPERATING)' on the
agency's website.
The instrument-wise rating actions are:
-- INR390.1 mil. Term loan due on March 2023 maintained in non-
cooperating category with IND BB (ISSUER NOT COOPERATING)
rating; and
-- INR50 mil. Working capital limits maintained in non-
cooperating category with IND BB (ISSUER NOT COOPERATING)/IND
A4+ (ISSUER NOT COOPERATING) rating.
Note: ISSUER NOT COOPERATING: The ratings were last reviewed on
January 10, 2020. Ind-Ra is unable to provide an update, as the
agency does not have adequate information to review the ratings.
Company Profile
Kashipur Infrastructure and Freight Terminal is a JV between India
Glycols Limited ('IND A'/Stable) and Apollo Logisolutions Limited.
It has been set up to operate an inland container depot in
Kashipur, Uttarakhand.
KLSR INFRATECH: Ind-Ra Downgrades Bank Loan Rating to 'B+'
----------------------------------------------------------
India Ratings and Research (Ind-Ra) has downgraded KLSR Infratech
Limited's bank loans' ratings to 'IND B+ (ISSUER NOT COOPERATING)'
from IND BB (ISSUER NOT COOPERATING)' and has simultaneously
withdrawn it.
The instrument-wise rating actions are:
-- INR325 mil. Fund-based working capital limit* downgraded and
withdrawn; and
-- INR1.650 bil. Non-fund-based working capital limit**
downgraded and withdrawn.
*Downgraded to 'IND B+ (ISSUER NOT COOPERATING)'/ 'IND A4 (ISSUER
NOT COOPERATING)' from 'IND BB (ISSUER NOT COOPERATING)'/'IND
A4+ (ISSUER NOT COOPERATING)' before being withdrawn
**Downgraded to 'IND A4 (ISSUER NOT COOPERATING)' from 'IND A4+
(ISSUER NOT COOPERATING)' before being withdrawn
Key Rating Drivers
The downgrade reflects an instance of invocation of bank guarantee
of up to 10 days during May 2022.
The ratings have been maintained in the non-cooperating category
before being withdrawn because the issuer did not participate in
the rating exercise, despite repeated requests by the agency, and
has not provided information about interim financials, sanctioned
bank facilities and utilization levels, business plan, and
projections for next three years, information on corporate
governance, and management certificate.
Ind-Ra is no longer required to maintain the ratings, as the agency
has received a no-objection certificate from the lenders. This is
consistent with the Securities and Exchange Board of India's
circular dated March 31, 2017 for credit rating agencies.
Company Profile
KLSR Infratech undertakes construction contracts, which mainly
include water supply projects, cement concrete drains, cement
concrete roads, among others, in Tamil Nadu, Andhra Pradesh,
Telangana and Odisha.
KSM EDUCATIONAL: Ind-Ra Keeps 'D' Loan Rating in Non-Cooperating
----------------------------------------------------------------
India Ratings and Research (Ind-Ra) has maintained KSM Educational
& Charitable Trust's bank loans' rating in the non-cooperating
category. The issuer did not participate in the rating exercise
despite continuous requests and follow-ups by the agency.
Therefore, investors and other users are advised to take
appropriate caution while using the rating. The rating will
continue to appear as 'IND D (ISSUER NOT COOPERATING)' on the
agency's website.
The detailed rating action is:
-- INR65.20 mil. Bank loans (Long-term) maintained in non-
cooperating category with IND D (ISSUER NOT COOPERATING)
rating.
Note: ISSUER NOT COOPERATING: The rating was last reviewed on May
17, 2019. Ind-Ra is unable to provide an update as the agency does
not have adequate information to review the ratings.
Company Profile
KSM Educational & Charitable Trust was established in 2007 and is
registered under the Indian Trust Act 1872. In 2008, it started a
college - Holy Trinity College of Education - in Kanyakumari
district. The trust also started a CBSE school named Holy Trinity
International School in the academic year 2015-2016.
LEO ENTERPRISES: Ind-Ra Moves B+ Issuer Rating to Non-Cooperating
-----------------------------------------------------------------
India Ratings and Research (Ind-Ra) has migrated Leo Enterprises'
Long-Term Issuer Rating to the non-cooperating category. The issuer
did not participate in the rating exercise despite continuous
requests and follow-ups by the agency. Therefore, investors and
other users are advised to take appropriate caution while using
these ratings. The rating will now appear as 'IND B+ (ISSUER NOT
COOPERATING)' on the agency's website.
The instrument-wise rating actions are:
-- INR3 mil. Fund-based facilities migrated to non-cooperating
category with IND B+ (ISSUER NOT COOPERATING)/IND A4 (ISSUER
NOT COOPERATING) rating;
-- INR10 mil. Proposed fund-based facilities* migrated to non-
cooperating category with IND B+ (ISSUER NOT COOPERATING)/IND
A4 (ISSUER NOT COOPERATING) rating;
-- INR20 mil. Proposed term loan* migrated to non-cooperating
category with IND B+ (ISSUER NOT COOPERATING)rating; and
-- INR17 mil. Proposed non-fund-based facilities* migrated to
non-cooperating category with IND A4 (ISSUER NOT COOPERATING)
rating.
Note: ISSUER NOT COOPERATING: The ratings were last reviewed on
June 22, 2021. Ind-Ra is unable to provide an update, as the agency
does not have adequate information to review the ratings.
Company Profile
Incorporated in 2014, Leo Enterprises is managed by Narasimha
Murthy. The firm is engaged in the manufacturing, installing, and
commissioning of industrial machinery for industrial sectors like
defense, steel, marine, power, civil, and solar photo voltaic plant
installation. The firm is located in Visakhapatnam (Andhra
Pradesh).
MAAN SAROVAR: Insolvency Resolution Process Case Summary
--------------------------------------------------------
Debtor: Maan Sarovar Properties Development Private Limited
No. 33/2, Gangai Street
Kalashethra Colony
Besant Nagar Extension
Besant Nagar
Chennai 600090
Insolvency Commencement Date: July 5, 2022
Court: National Company Law Tribunal, Chennai Bench
Estimated date of closure of
insolvency resolution process: December 28, 2022
(180 days from commencement)
Insolvency professional: J. Karthiga
Interim Resolution
Professional: J. Karthiga
Sri Nivas, New No. 1
Old No. 1052, 41st Street
Korattur, Chennai 600080
E-mail: karthigasri@hotmail.com
cirp.maansarovar@gmail.com
Last date for
submission of claims: July 19, 2022
MAHANADI EDUCATION: Ind-Ra Keeps BB Loan Rating in Non-Cooperating
------------------------------------------------------------------
India Ratings and Research (Ind-Ra) has maintained the ratings on
Mahanadi Education Society's bank facilities in the non-cooperating
category. The issuer did not participate in the rating exercise
despite continuous requests and follow-ups by the agency.
Therefore, investors and other users are advised to take
appropriate caution while using the rating. The rating will
continue to appear as 'IND BB (ISSUER NOT COOPERATING)' on the
agency's website.
The instrument-wise rating actions are:
-- INR74.5 mil. Term loan due on September 2019 maintained in
non-cooperating category with IND BB (ISSUER NOT COOPERATING)
rating; and
-- INR100 mil. Working capital facility maintained in non-
cooperating category with IND BB (ISSUER NOT COOPERATING)
rating.
Note: ISSUER NOT COOPERATING: The rating was last reviewed on May
2, 2017. Ind-Ra is unable to provide an update, as the agency does
not have adequate information to review the ratings.
Company Profile
Founded in 1994, Mahanadi Education Society was registered with the
Registrar of Firms and Societies, the government of Madhya Pradesh.
The society manages and operates Raipur Institute of Technology
(1995), Kaanger Valley Academy (2005), RIT College of Nursing
(2008), RIT College of Management (2009), RIT College of Hotel
Management (2016) and RIT College of Education (2013).
MAHARANA CHAINS: CRISIL Reaffirms B+ Rating on INR12cr Cash Loan
----------------------------------------------------------------
CRISIL Ratings has reaffirmed its 'CRISIL B+/Stable' rating on the
long-term bank facilities of Shri Maharana Chains (SMC).
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 12 CRISIL B+/Stable (Reaffirmed)
The rating continues to reflect susceptibility of operating
performance to volatility in gold prices and intense competitive
pressure in the domestic jewellery segment and its below-average
financial risk profile. These weaknesses are partially offset by
the proprietor's extensive experience in the gold jewellery
business.
Analytical Approach
Unsecured loans of INR2.47 crore as of March 31, 2022, have been
treated as NDNE.
Key Rating Drivers & Detailed Description
Weaknesses:
* Intense competitive pressure in the domestic jewellery segment:
Intense competition along with fragmented nature of jewellery
industry with large number of players has constrained operating
margins in the range of 1.2-3.3% over the last 5 years ended fiscal
2022. The margins are expected to remain in the similar range over
the medium term.
* Below average financial risk profile: Small net worth and high
total outside liabilities to adjusted networth (TOL/ANW) (INR2.88
crore and 4.95 times estimated as on March 31, 2022) represents
below average financial risk profile. Debt protection matrix is
subdued indicated by coverage of 1.59 times as of March 31,2022.
Strengths:
* Proprietor's extensive experience in the gold jewellery business:
Decade-long experience of the promoter, Mr Chunasingh Dasana, in
the gold jewelery industry, and their longstanding relationships
with customers and suppliers have helped the firm successfully
navigate business cycles over the years and establish its market
position. Benefits from the extensive industry experience of the
promoters would continue over the medium term
Liquidity: Poor
Cash accruals of the firm is expected to be modest at around INR58
lakhs for fiscal 2022 against repayment obligation of INR18 lakhs
in fiscal 2022. Firm has also availed INR1.32 crores under Covid-19
government emergency credit scheme. Timely funding from proprietor
is expected to support liquidity of the firm.
Firm has fund based limit of INR13.5 crore which is utilized to the
tune of 96.63% for last 12 months ending March 31, 2022. Current
ratio of the firm is expected to be around 1.42 times as on March
31, 2022.
Outlook: Stable
CRISIL Ratings believes the firm will continue to benefit from its
established presence in the gold jewellery industry, supported by
its proprietor's extensive experience and established relations
with suppliers and customers
Rating Sensitivity factors
Upward factors
* Growth in revenues while sustaining operating margins leading to
sustenance of cash accruals more than INR1 crore per fiscal
* Improvement in financial risk profile especially interest
coverage
Downward factors
* Decline in operating margin leading to interest coverage below
1.2 times.
* Deterioration in capital structure caused by more than expected
debt funded capex, capital withdrawal or further stretch in working
capital cycle
Set up in 2006 and promoted by Mr Chunasingh Dasana, SMC
manufactures gold chains at its facility in Mumbai.
MANIPAL ENERGY: Ind-Ra Hikes Long-Term Issuer Rating to 'BB+'
-------------------------------------------------------------
India Ratings and Research (Ind-Ra) has upgraded Manipal Energy and
Infratech Limited's (MEIL) Long-Term Issuer Rating to 'IND BB+'
from 'IND BB'. The Outlook is Positive.
The instrument-wise rating actions are:
-- INR150 mil. Fund-based working facilities Long-term rating
upgraded; Short-term rating affirmed with IND
BB+/Positive/IND A4+ rating;
-- INR250 mil. Non-fund-based working facilities Long-term rating
upgraded; Short-term rating affirmed with IND BB+/Positive
/IND A4+ rating; and
-- INR39 mil. (reduced from INR43 mil.) Term loan due on FY26
Long-term rating upgraded with IND BB+/Positive rating.
Analytical Approach:
Ind-Ra continues to take a consolidated view of MMNL and its
wholly-owned subsidiaries — Manipal Energy & Infratech Limited
(MEIL; 'IND BB+'/Positive); Manipal Digital Network Limited; and
Manipal Ace Event Management Company Private Limited. The ratings
factor in the cash flow fungibility and common management among
these entities.
The upgrade reflects the strengthening of linkages between MMNL and
MEIL as a result of increasing contribution of MEIL to MMNL.
The Positive Outlook reflects: (a) the likely improvement in the
consolidated profitability and the credit metrics in FY22 and (b)
the enhanced visibility on the repayment (timelines and amount) of
unsecured loans extended by MMNL to MVP Group International Inc.
(MVP, a US-based Manipal Group company). The repayment of this
unsecured loan could lead to a significant improvement in the net
leverage of the company by FYE23.
Key Rating Drivers
Likely Improved Credit Metrics: The consolidated credit metrics
are likely to have improved in FY22 with the net adjusted leverage
(net debt/EBITDA) of just above 5.0x at FYE22 (FYE21: 11.1x) and
the gross interest coverage (EBITDA/ gross interest) of 1.6x (0.8x)
due to EBITDA improvement. This was despite the consolidated
adjusted gross debt (including 50% equity credit for preference
shares) increasing to INR1,483 million at FYE22 (FYE21: INR1,424
million). The high debt levels are mainly due to inter-corporate
loans (ICD) of INR975 million at FYE22 (FYE21: INR927 million)
received from the group companies, which had been on-lent primarily
to MVP. The total loan extended to the group companies is likely to
have been INR1,154 million at FYE22 (FYE21: INR1,144 million),
which represents nearly 50% of MMNL's net worth. According to the
management articulation, MVP will settle a substantial portion of
the ICDs by FYE23 on the acquisition of GP Global (Hold Co. of MVP
and Primacy Industries Limited) by NASDAQ-listed Global Consumer
Acquisition Corp (special purpose acquisition company).
Improved Operating Performance: The consolidated revenue was up 80%
yoy in FY22, primarily due to robust growth in MEIL's operations
(revenue up 217% yoy to INR1,191 million) and an improvement in
MMNL's standalone operations (revenue up 16% yoy to INR903
million). MMNL's standalone revenue improved mainly due to a 25%
yoy rise in the advertisement revenue (about 28% of the
consolidated revenue). MEIL's revenue (about 56% of the
consolidated revenue) improved due to the timely execution of
projects, entry into new geographies and a healthy order book. The
consolidated EBITDA margins are likely to improve to 12.9% in FY22
(FY21: 10.7%); the rise in margins is attributed to the various
cost-cutting initiatives taken by the company. Ind-Ra believes a
recovery in the consolidated operational and financial profile will
continue over the medium term.
Weak Counterparties Despite Healthy Order Book: Despite MEIL having
a healthy order book of about INR2,298 million in March 2022,
providing a revenue visibility of almost 2x of FY22 revenue, the
counterparty profile of a majority of its customers remained weak.
Majority of MEIL's customers are regional electricity boards that
have weak financial profiles. The receivable days (FY22: 330 days;
FY21: 432 days) were on a higher side. However, the increase in
payable days and a fall in receivable days led to a reduction in
the working capital cycle, although slightly elongated.
Liquidity Indicator - Stretched: MEIL's free cash flows have been
negative since FY17, except in FY19 when it turned slightly
positive. The company needed continuous financial support from the
parent, either in the form of equity or inter-corporate loans over
FY17-FY22 as its operations remained susceptible to the high
working capital requirements. Ind-Ra, thus, believes that any cash
shortfall to meet the working capital requirements will be met by
the support from the parent. Cash and cash equivalents stood at
INR0.6 million at FYE22 (FYE21: INR0.2 million). The company's
average utilization of the fund-based limits remained high at about
95% over the 12 months ended April 2022. Liquidity of MEIL's parent
MMNL is also stretched, although is backed by the continuous
support from other Manipal group entities.
Strong Parent Support: Ind-Ra believes the overall linkages between
MEIL and MMNL are strong and MEIL will continue to receive such
support (if required) from MMNL and other group entities. The
strategic linkages between the entities are strong, given the
history of continuous tangible support from MMNL to MEIL and also
MEIL contributed around 56% to the total consolidated revenue in
FY22. At FYE22, MMNL provided an unsecured borrowing of INR205
million (FYE21: INR186 million) to MEIL, and other group entities
infused INR26 million in MEIL (INR24 million). The unsecured loans
from the group entities stood at INR231 million at FYE22, as
additional support of INR21 million was extended during FY22.
Moreover, MEIL has the repayment flexibility for the extended
loans. The legal linkages are strong as MMNL has provided a
post-default irrevocable and unconditional corporate guarantee for
MEIL's entire external debt, which was about 46% of the total debt
outstanding at FYE22 (FYE21: 45%). Despite being in unrelated
businesses, the operational linkages between these two entities are
moderate, owing to the strong supervision of operations by the
parent and common treasury functions between these two entities.
MEIL executes civil construction and rural electrification works
for various state electricity boards, while MMNL has a newspaper
publishing business.
Improvement in Standalone Credit Metrics: The net leverage declined
to 4.5x at FYE22 (FYE21: 8.3x) and the interest coverage
(EBITDA/gross interest cost) improved to 1.7x (1.1x), primarily due
to the improved EBITDA (FY22: INR92 million; FY21: INR46 million).
Majority of the debt (around 48%) continues to be from the parent
entity. Excluding the inter-corporate loans of MMNL, the net
leverage came out to be 2.2x at FYE22 (FYE21: 3.8x).
Rating Sensitivities
Positive: Developments that could, individually or collectively,
lead to a positive rating action include:
-- a positive rating action on MMNL
-- a rise in the standalone revenue and EBITDA margin expansion,
along with an improvement in the working capital cycle, leading to
a sustained improvement in MEIL's standalone credit profile
Negative: Developments that could, individually or collectively,
lead to a negative rating action include:
-- any negative rating action on MMNL
-- any weakening of linkages between MMNL and MEIL
-- a sharper-than-expected decline in the MEIL's standalone
revenue and profitability, leading to deterioration in the credit
metrics, on a sustained basis.
Company Profile
MEIL, a 100% subsidiary of MMNL, is an engineering, procurement and
construction contractor executing civil construction and rural
electrification work for various state electricity boards.
MANIPAL MEDIA: Ind-Ra Affirms BB+ Issuer Rating, Outlook Positive
-----------------------------------------------------------------
India Ratings and Research (Ind-Ra) has revised Manipal Media
Network Limited's (MMNL) Outlook to Positive from Negative while
affirming its Long-Term Issuer Rating at 'IND BB+'.
The instrument-wise rating actions are:
-- INR207 mil. (increased from INR172 mil.) Term loans due on
FY29 affirmed; Outlook revised to Positive from Negative with
IND BB+/Positive rating;
-- INR150 mil. (reduced from INR250 mil.) Fund-based working
facilities affirmed; Outlook revised to Positive from
Negative with IND BB+/Positive /IND A4+ rating; and
-- INR100 mil. Non-fund-based working facilities assigned with
IND BB+/Positive /IND A4+ rating.
Analytical Approach: Ind-Ra continues to take a consolidated view
of MMNL and its wholly-owned subsidiaries — Manipal Energy &
Infratech Limited (MEIL; 'IND BB+'/Positive); Manipal Digital
Network Limited and Manipal Ace Event Management Company Private
Limited. The ratings factor in the cash flow fungibility and common
management among these entities.
The Positive Outlook reflects (a) the likely improvement in the
consolidated profitability and credit metrics in FY22 and (b) the
enhanced visibility on repayment (timelines and amount) of
unsecured loans extended by MMNL to MVP Group International Inc.
(MVP, a US-based Manipal Group company). The repayment of this
unsecured loan could lead to a significant improvement in the net
leverage of the company by FYE23.
Key Rating Drivers
Likely Improved Credit Metrics: The consolidated credit metrics
are likely to have improved in FY22 with the net adjusted leverage
(net debt/EBITDA) of just above 5.0x at FYE22 (FYE21: 11.1x) and
the gross interest coverage (EBITDA/ gross interest) of 1.6x (0.8x)
due to EBITDA improvement. This was despite the consolidated
adjusted gross debt (including 50% equity credit for preference
shares) increasing to INR1,483 million at FYE22 (FYE21: INR1,424
million). The high debt levels are mainly due to inter-corporate
loans (ICD) of INR975 million at FYE22 (FYE21: INR927 million)
received from the group companies, which had been on-lent primarily
to MVP. The total loan extended to the group companies is likely to
have been INR1,154 million at FYE22 (FYE21: INR1,144 million),
which represents nearly 50% of MMNL's net worth. According to the
management articulation, MVP will settle a substantial portion of
the ICDs by FYE23 on the acquisition of GP Global (Hold Co. of MVP
and Primacy Industries Limited) by NASDAQ-listed Global Consumer
Acquisition Corp (special purpose acquisition company).
Improved Operating Performance: The consolidated revenue was up 80%
yoy in FY22, primarily due to robust growth in MEIL's operations
(revenue up 217% yoy to INR1,191 million) and an improvement in
MMNL's standalone operations (revenue up 16% yoy to INR903
million). MMNL's standalone revenue improved mainly due to a 25%
yoy rise in the advertisement revenue (about 28% of the
consolidated revenue). MEIL's revenue (about 56% of the
consolidated revenue) improved due to the timely execution of
projects, entry into new geographies and a healthy order book. The
consolidated EBITDA margins are likely to improve to 12.9% in FY22
(FY21: 10.7%); the rise in margins is attributed to the various
cost-cutting initiatives taken by the company. Ind-Ra believes a
recovery in the consolidated operational and financial profile will
continue over the medium term.
Liquidity Indicator - Stretched: Ind-Ra believes MMNL's cash flow
from operations will remained stretched over the medium term to
meet its debt-servicing requirements. That said, Ind-Ra expects
MMNL will continue to receive support from the Manipal Group over
the next two years on a timely basis. MMNL's standalone cash and
equivalents increased to INR33 million at FYE22 (FYE21: INR15
million). The company's working capital cycle remained elongated at
154 days in FY21 (FY20: 108 days), on account of high receivables
levels in MEIL. Ind-Ra has not factored in the repayment of loan by
MVP; however, the loan, once repaid, will aid MMNL's liquidity
substantially. Also, the company had availed COVID emergency loans
of INR77 million from banks during FY21 and FY22.
Support from Manipal Group: The ratings continue to be supported by
MMNL's association with the Manipal Group (promoted by Satish Pai);
this includes MMNL, Manipal Technologies Limited ('IND
BBB+'/Negative) and Primacy Industries Limited ('IND D (ISSUER NOT
COPERATING)'). With MMNL operating as a holding company for Manipal
Group, the likelihood of MMNL receiving support from the promoters
and other group companies is high. Ind-Ra expects the support to
continue to flow to MMNL from the group, if required.
Territorial Market Leadership: MMNL is among the top players in the
coastal Karnataka region. As per the management, the company holds
around 70% of the circulation market share in the coastal region,
with an average daily circulation of about 195,226 daily copies in
FY22. MMNL is also known for its weekly and monthly publications in
Kannada language. The company's regional focus has resulted in a
moderate scale of operations, which is unlikely to grow
substantially.
Improvement in Standalone Credit Profile: MMNL's performance
improved in FY22 with the revenue increasing to INR903 million
(FY21: INR777 million), EBITDA margins to 20.0% (15.0%) and
absolute EBITDA to INR180 million (INR117 million). MMNL's gross
debt increased to INR1,242 million at FYE22 (FYE21: INR1,215
million); a significant portion of the total debt is from other
group companies and directors. The standalone profitability in FY23
could remain under pressure due to high input cost; however, the
likely reduction in the net debt will improve the standalone credit
profile of the company significantly.
Rating Sensitivities
Positive: A reduction in the consolidated debt levels, along with
an increase in the operating profits leading to the consolidated
net adjusted leverage reducing below 4.0x on a sustained basis
could lead to a positive rating action
Negative: Developments that could, individually or collectively,
lead to a negative rating action include:
-- higher-than-expected financial support provided by MMNL to
other group entities
-- deterioration in the consolidated credit profile with the net
adjusted leverage remaining above 4.0x on a sustained basis
-- a weakening of MMNL's importance to the overall Manipal Group,
thereby limiting the possibility of receiving further support from
the group
Company Profile
Incorporated in 1948 in Manipal, Udupi, by the Manipal Group, MMNL
is a newspaper publishing house. Its flagship Kannada daily
newspaper - Udayavani - commands 70%-80% regional language market
share and reasonable market share in its English edition. Udayavani
publishes editions in Manipal, Bengaluru, Hubli, Gulbarga,
Davanagere and Mumbai.
MARIGOLD TRUST: Ind-Ra Gives 'B' Bank Loan Rating, Outlook Stable
-----------------------------------------------------------------
India Ratings and Research (Ind-Ra) has rated Marigold Trust's (MT)
bank loans as follows:
-- INR245 mil. Bank loans assigned with IND B/Stable rating.
Key Rating Drivers
The rating reflects MT's limited track record and small scale of
operations. The trust began operating only in FY21. Furthermore,
the trust manages only one school. The total student headcount grew
by 192.59% yoy to 158 in FY22, and further to 842 as of June 2022.
Ind-Ra expects the student headcount to grow further in FY24, given
the availability of infrastructure for the same.
The rating is constrained by the trust's continued operating losses
during FY21-FY22 due to high expenditure. In FY22 (provisional
financials), the trust's EBITDA loss widened to INR16.98 million
(FY21: INR13.80 million), as the total expenditure increased to
INR62.52 million (INR34.96 million). Other operating expenses
accounted for the largest share (41.36%) of the total expenditure,
followed by interest costs (proportioned 33.70%) and staff cost
(23.85%). Ind-Ra expects the operating profitability to improve
gradually from FY23 on account of an improvement in tuition fee
collection.
The rating is further constrained by MT's high debt burden, as
indicated by debt /income of 3,884.14% in FY22. The debt/EBITDA
ratio and net debt/EBITDA ratio were negative during FY21-FY22 due
to the EBITDA losses. The total debt increased by 22.75% yoy to
INR773.34 million in FY22, mainly because unsecured loans rose by
16.63% yoy and bank loans rose by 36.11%.
Liquidity Indicator - Poor: The trust's liquidity profile is poor
due to its nascent stage of operations. The trust relies on a
single bank for funding diversification and does not have access to
the capital market. Furthermore, the small scale of operations
limits the trust's ability to absorb any shocks to the liquidity
position. Nevertheless, the cash and bank balance increased to
INR43.82 million in FY22 from INR11.59 million in FY21.
Furthermore, the liquidity profile is supported by the trustee's
funds in the form of interest-free unsecured loans. The available
funds/total debt ratio was only 5.67% in FY22 (FY21:1.43%). The
principal repayments will start from FY24. MT's debt service
commitments as a percentage of the total income fell to 125.26% in
FY22 (FY21: 387.97%), mainly due to the increase in the total
income. In Ind-Ra's opinion, the liquidity profile is likely to
remain weak in FY23 due to MT's past and ongoing capex plan and
weak operating profitability.
The ratings derive support from the strong financial support from
trustees, as reflected in the outstanding interest-free unsecured
loans of INR524.46 million in FY22 (FY21: INR449.69 million).
Despite incurring operating losses, the trust has been able to meet
its debt service obligations in a timely manner, on the back of the
funds provided by the trustees in the form of unsecured loans.
Ind-Ra believes the trust would continue to rely on the trustees'
financial support during FY23-FY24 for timely debt servicing. The
trustees have vast experience in the medical field and also manage
other group companies, including a hospital.
The rating benefits from the increase in the trust's total income
to INR19.91 million in FY22 (FY21: INR4.22 million) owing to the
growth in the student headcount. The rating is also supported by an
increase in capacity utilization to 72% in FY22 (FY21: 26%). Ind-Ra
expects the revenue to increase on a yoy basis in FY23, as the
student headcount had already increased to 842 as of June 2022.
Rating Sensitivities
Negative: Inability to improve the operating profitability, lack of
timely support from trustees to meet debt obligations and further
stress on the liquidity position will be negative for the ratings.
Positive: Sustained growth in headcount, resulting in growth in the
scale of operations along with an improvement in operating
profitability and liquidity position could lead to a positive
rating action.
Company Profile
MT was formed in 2018 by Ujwala Nagaraja Rao Jagdale, who manages
other companies and has set up the Marigold Hospital in Bangalore.
She has worked in the pharmaceutical industry for a span of 14
years. Sudhindra Damodhar Rao is also a trustee and a doctor by
profession. He consults in various hospitals. The trust manages the
Marigold International School in Bangalore. Marigold International
School, a CBSE school, started in FY21 and offers education to K-9
students. FY21 was the first academic year of operation and 54
students were enrolled in grade K-7, which increased to 158
students in FY22.
NAV DURGA: CRISIL Keeps D Debt Ratings in Not Cooperating
---------------------------------------------------------
CRISIL Ratings said the ratings on bank facilities of Nav Durga
Fuel Private Limited (NDFPL) continue to be 'CRISIL B/Stable/CRISIL
A4 Issuer Not Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Bank Guarantee 2 CRISIL A4 (Issuer Not
Cooperating)
Cash Credit 55 CRISIL B/Stable (Issuer Not
Cooperating)
Corporate Loan 3 CRISIL B/Stable (Issuer Not
Cooperating)
Letter of Credit 6 CRISIL A4 (Issuer Not
Cooperating)
Proposed Long Term
Bank Loan Facility 1 CRISIL B/Stable (Issuer Not
Cooperating)
Standby Line
of Credit 3 CRISIL B/Stable (Issuer Not
Cooperating)
CRISIL Ratings has been consistently following up with NDFPL for
obtaining information through letters and emails dated March 14,
2022 and May 30, 2022 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
Ratings failed to receive any information on either the financial
performance or strategic intent of NDFPL, which restricts CRISIL
Ratings' ability to take a forward-looking view on the entity's
credit quality. CRISIL Ratings believes that rating action on NDFPL
is consistent with 'Assessing Information Adequacy Risk'. Based on
the last available information, the ratings on bank facilities of
NDFPL continue to be 'CRISIL B/Stable/CRISIL A4 Issuer Not
Cooperating'.
NDFPL, incorporated in February 2004 and promoted by Mr G.S.
Agarwal and family was taken over by Gadodia family in February
2006. It manufactures sponge iron (90,000 MTPA), ingots (66,000
MTPA) and TMT bars (90,000 MTPA) and sells them under the 'Shristi'
brand. It also has a waste heat recovery-based power plant of 12 MW
and a coal washery unit.
NEXUS HEALTH: Insolvency Resolution Process Case Summary
--------------------------------------------------------
Debtor: Nexus Health & Beauty Care Private Limited
C/o Raj Kamal Singh Grewal
Karnani Mansion, 1st Floor
Flat-114, 25A Park Street
Kolkata 700016
West Bengal
Insolvency Commencement Date: July 6, 2022
Court: National Company Law Tribunal, Kolkata Bench
Estimated date of closure of
insolvency resolution process: January 2, 2023
Insolvency professional: CA Pankaj Lunawat
Interim Resolution
Professional: CA Pankaj Lunawat
Everest House, Suite No. 8C
8th Floor, 46C
Jawahar Lal Nehru Road
Kolkata 700071
E-mail: plunawatca@gmail.com
Last date for
submission of claims: July 20, 2022
ORANGE MEGASTRUCTURE: CRISIL Withdraws B+ Rating on INR100cr Loan
-----------------------------------------------------------------
CRISIL has withdrawn the ratings on certain bank facilities of
Orange Megastructure LLP (OMLLP), as:
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 2.5 CRISIL B+/Stable (Issuer Not
Cooperating)
Lease Rental 100.0 CRISIL B+/Stable/Issuer Not
Discounting Loan Cooperating (Withdrawn)
Lease Rental 40 CRISIL B+/Stable (Issuer Not
Discounting Loan Cooperating)
Long Term Loan 15 CRISIL B+/Stable (Issuer Not
Cooperating)
Proposed Fund- 0.5 CRISIL B+/Stable/Issuer Not
Based Bank Limits Cooperating (Withdrawn)
CRISIL Ratings has been consistently following up with OMLLP for
obtaining information through letters and emails dated May 10, 2022
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
Ratings failed to receive any information on either the financial
performance or strategic intent of OMLLP, which restricts CRISIL
Ratings' ability to take a forward-looking view on the entity's
credit quality. CRISIL Ratings believes that rating action on OMLLP
is consistent with 'Assessing Information Adequacy Risk'. Based on
the last available information, the ratings on bank facilities of
OMLLP continue to be 'CRISIL B+/Stable Issuer Not Cooperating'.
CRISIL Ratings has withdrawn its rating on INR100 Crore Lease
Rental Discounting Loan, INR0.5 Crore Proposed fund-based Bank
Limits on the bank facilities of OMLLP on the request of the
company and after receiving no objection certificate from the bank.
The rating action is in-line with CRISIL Ratings policy on
withdrawal of its rating on bank loan facilities.
OMLLP owns Le-Meridien, a five-star hotel in Surat. The firm is
promoted by Century 21 Town Planners Pvt Ltd, Mr. Rajesh Mehta and
Mr. Gurjeet Singh Chhabra with shareholding of 49.92%, 50% and
0.08% respectively. The firm is operational from April 2017.
ORISSA STATE: Ind-Ra Keeps BB Bank Loan Rating in Non-Cooperating
-----------------------------------------------------------------
India Ratings and Research (Ind-Ra) has maintained The Orissa State
Co-operative Milk Producers' Federation Ltd.'s bank facilities
ratings in the non-cooperating category. The issuer did not
participate in the rating exercise despite continuous requests and
follow-ups by the agency. Therefore, investors and other users are
advised to take appropriate caution while using the rating. The
rating will continue to appear as 'IND BB (ISSUER NOT COOPERATING)'
on the agency's website.
The detailed rating action is:
-- INR500 mil. Fund-based working capital limits maintained in
non-cooperating category with IND BB (ISSUER NOT COOPERATING)
rating.
Note: ISSUER NOT COOPERATING: The rating was last reviewed on July
10, 2020. Ind-Ra is unable to provide an update, as the agency does
not have adequate information to review the rating.
Company Profile
Formed in 1981, The Orissa State Co-operative Milk Producers'
Federation is the leading organized milk producer in Odisha and
processes and markets liquid milk and milk products.
OSL AUTOMOTIVES: CRISIL Reaffirms B+ Rating on INR8.75cr Loan
-------------------------------------------------------------
CRISIL Ratings has reaffirmed its 'CRISIL B+/Stable' rating on the
long-term bank facilities of OSL Automotives Private Limited
(OAPL).
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 5 CRISIL B+/Stable (Reaffirmed)
Inventory Funding 8.46 CRISIL B+/Stable (Reaffirmed)
Facility
Inventory Funding 8.75 CRISIL B+/Stable (Reaffirmed)
Facility
Inventory Funding 5.00 CRISIL B+/Stable (Reaffirmed)
Facility
Inventory Funding 7.28 CRISIL B+/Stable (Reaffirmed)
Facility
Inventory Funding 5.00 CRISIL B+/Stable (Reaffirmed)
Facility
Inventory Funding 7.00 CRISIL B+/Stable (Reaffirmed)
Facility
Inventory Funding 2.00 CRISIL B+/Stable (Reaffirmed)
Facility
Inventory Funding 12.26 CRISIL B+/Stable (Reaffirmed)
Facility
Long Term Loan 5.9 CRISIL B+/Stable (Reaffirmed)
Medium Term Loan 2.99 CRISIL B+/Stable (Reaffirmed)
Term Loan 0.98 CRISIL B+/Stable (Reaffirmed)
Term Loan 1.38 CRISIL B+/Stable (Reaffirmed)
The rating continues to reflect the subdued financial risk profile
of the company, its exposure to intense competition and low
profitability in the trading business. These weaknesses are
partially offset by the extensive experience of the promoter in the
automobile (auto) dealership industry, his established relationship
with the principal supplier, Tata Motors Ltd (TML; 'CRISIL
AA-/Stable'), and the prudent working capital management of the
company.
Key Rating Drivers & Detailed Description
Weaknesses:
* Low profitability: OAPL has modest scale compared with large auto
dealership players. Revenue and profitability depend on the
principal supplier, TML, with limited scope for value addition in
the dealership model. The operating margin was low at 3.99% in the
three fiscals through 2022.
* Average financial risk profile: Networth was modest at INR10.73
crore and total outside liabilities to tangible networth (TOLTNW)
ratio was high at 7.09 times, as on March 31, 2022. Debt protection
metrics were subdued, as reflected in interest coverage and net
cash accrual to total debt ratios of 1.15 times and 0.01 time,
respectively, in fiscal 2022.
* Exposure to intense competition: The auto dealership business is
highly competitive. Intense competition constrains scalability, as
indicated by revenue of INR168.92 crore in fiscal 2022. Sale of
commercial vehicles contributes to around 90% revenue.
Strengths:
* Extensive experience of the promoter, and healthy relationship
with TML: The promoter has experience of over eight years in the
auto dealership business. His longstanding presence and healthy
relationship with TML has helped scale up operations in a short
period by identifying untapped markets.
* Efficient working capital requirement: Gross current assets were
at 138 days as of March 31, 2022. The company faces negligible
receivables risk as sales are diversified across large clientele
and backed by financial institutions, which pay in 8-10 days
Liquidity: Stretched
Expected cash accrual of over INR89.92 lakh per annum will
comfortably cover yearly term debt obligation over the medium term.
Bank limit utilization averaged 94% for the six months through 31st
March 2022. Any shortfall will be funded by the promoter and
short-term loans. Current ratio was moderate at 1.28 times as of
March 31, 2022
Outlook: Stable
CRISIL Ratings believes OAPL will continue to benefit from the
extensive experience of the promoter in the auto dealership
business and his established relationship with TML
Rating Sensitivity factors
Upward factors
* Sustained revenue growth of 20%, strengthening the financial risk
profile, with TOLTNW ratio of 3.5% times
* Strong relationships with vendors
* Better working capital management
Downward factors
* Stagnation in business owing to weak demand, or stretch in
receivables or pile-up of inventory, weakening the liquidity
* Decline in cash accrual below INR60 lakh
* Weakening of relationships with major vendors
Incorporated in 2007, OAPL is an authorized dealer for commercial
vehicles of TML in Bengal. Its operates in five districts:
Jalpaiguri, Cooch Behar, Uttar Dinajpur, Siliguri and Darjeeling.
The company is promoted by Mr. Pawan Kumar Goyal.
PLANET MOBILES: Insolvency Resolution Process Case Summary
----------------------------------------------------------
Debtor: Planet Mobiles Private Limited
171-C, 17th Floor Mittal Court C Wing
Nariman Point Mumbai City
MH 400021
IN
Insolvency Commencement Date: July 9, 2022
Court: National Company Law Tribunal, Aurangabad, Maharashtra
Estimated date of closure of
insolvency resolution process: January 4, 2023
(180 days from commencement)
Insolvency professional: Neha Punit Agrawal
Interim Resolution
Professional: Neha Punit Agrawal
Practicing Company Secretary
B-3, Kalyani Gurumukh Heights
Osmanpura, Aurangabad 431001
Email: nehapagrawal@gmail.com
csnehapagrawal@gmail.com
Last date for
submission of claims: July 23, 2022
POLYOLEFIN SACKS: Ind-Ra Affirms BB+ Issuer Rating, Outlook Stable
------------------------------------------------------------------
India Ratings and Research (Ind-Ra) has affirmed KP Polyolefin
Sacks Private Limited's (KPPSPL) Long-Term Issuer Rating at 'IND
BB+'. The Outlook is Stable.
The instrument-wise rating actions are:
-- INR96 mil. Fund-based working capital limit affirmed with IND
BB+/Stable/IND A4+ rating; and
-- INR18.88 mil. Term loan due on May 2024 affirmed with IND BB+/
Stable rating.
Key Rating Drivers
The affirmation reflects KPPSPL's continued small scale of
operations, with its revenue rising to INR550.12 million in FY22
(FY21: INR441.53 million), due to an increase in the selling price
of end-products coupled with an increase in its order execution.
Ind-Ra expects the revenue to improve slightly, despite remaining
small, in the near term, on account of repeated orders from
customers. Its FY22 numbers are provisional in nature.
Liquidity Indicator – Stretched: KPPSPL's average maximum
utilization of the fund-based limits was 89.50% for the 12 months
ended June 2022. The company's cash flow from operations stood at
negative INR10.85 million in FY22 (FY21: negative INR10.02
million), due to the increase in working capital requirement.
Consequently, KPPSPL's free cash flow stood at negative INR11.97
million in FY22 (FY21: negative INR14.52 million). The net working
capital cycle deteriorated to 192 days in FY22 (FY21: 174 days),
due to an increase in receivable period to 87 days (77 days), on
account of a customer applying for insolvency in FY22. Besides, the
company saw a decline in its credit period to four days in FY22
(FY21: 11 days), due to the management's decision to make the
purchases with advance payments to maintain relationship with newly
added suppliers. The company had unencumbered cash of INR0.38
million at FYE22 (FYE21: INR0.56 million). Furthermore, the company
does not have any capital market exposure and relies on banks and
financial institutions to meet its funding requirements.
The ratings reflect KPPSPL's average EBITDA margin due to intense
competition in the industry and the sharp volatility in raw
material prices. The margin remained stable at 10.39% in FY22
(FY21: 10.17%), owing to the similar nature of operations. The
return over capital employed was 13.4% in FY22 (FY21: 7.9%). Ind-Ra
expect the margin to remain stable in the near term, on account of
the similar nature operations.
The ratings also factor in KPPSPL's modest credit metrics with the
gross interest coverage (operating EBITDA/gross interest expense)
at 5.88x in FY22 (FY21: 4.97x) and the net leverage (adjusted net
debt/operating EBITDA) at 1.48x (1.66x). The metrics improved in
FY22 due to an increase in the absolute EBITDA to INR57.15 million
in FY22 (FY21: INR44.91 million) along with a decline in the total
debt on account of the scheduled repayment of term loans. Ind-Ra
expect the credit metrics to improve in the near term, on account
of scheduled repayments of its term loans of INR6.29 million,
INR6.29 million and INR2.09 million over FY23, FY24 and FY25,
respectively.
The ratings, however, continue to be supported by the usage of
KPPSPL's packaging products across various industries, including
fertilizers, food, sugar and textiles, thereby ensuring continuous
demand, and getting protection from the cyclicality in any one
sector and the promoters' over one-decade experience in the plastic
industry.
Rating Sensitivities
Negative: A decline in the scale of operations, leading to a
deterioration in the credit metrics, with the interest coverage
falling below 2.4x, on a sustained basis, and/or pressure on the
liquidity position, will be negative for the ratings.
Positive: A substantial improvement in the scale of operations
while maintaining the credit metrics on a sustained basis, along
with an improvement in the liquidity position, will be positive for
the ratings.
Company Profile
Incorporated in 2011, KPPSPL manufactures woven fabric, bags, sacks
and tarpaulin for cargo packaging. The company is promoted by KPCL
and Middle East Industrial Investment LLC. Its manufacturing
facility has an installed capacity of 6,500 metric tons per annum.
PRAGATI GRANITO: CRISIL Reaffirms B+ Rating on INR6.0cr Loans
-------------------------------------------------------------
CRISIL Ratings has reaffirmed its 'CRISIL B+/Stable' rating on the
bank facilities of Pragati Granito (India) Private Limited
(PGIPL).
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 0.72 CRISIL B+/Stable (Reaffirmed)
Term Loan 5.28 CRISIL B+/Stable (Reaffirmed)
The rating reflects improvement in business risk profile of the
client, backed by increased scale of operations and profitability.
Operating income is estimated around INR4.86 crore in FY22 against
INR2.63 crore in FY21 with capacity utilization of 45-50%. Margins
are at same levels of just over 4.15% to 5% and working capital
cycle is to remain at similar level. The ratings continue to
reflect the group's established market position supported by the
extensive experience of its promoters in the industry
CRISIL Ratings had upgraded its rating on the bank facilities of
PGIPL to 'CRISIL B+/Stable' from 'CRISIL B/Stable' as on June 14,
2022.
Key Rating Drivers & Detailed Description
Weaknesses:
* Working capital intensive operations: Operations are highly
working capital intensive as reflected in gross current assets of
235 days as of March 31, 2021, led by large receivables and
inventory of 79 and 147 days, respectively. The company must keep
substantial amount of inventory since there is some seasonality in
procurement of graphite.
* Average financial risk profile: The financial risk profile of the
company is expected to be modest with modest networth of
INR2.14crore, high gearing around 3.13 times respectively, as of
March 31, 2021and subdued debt protection metrics.
Strength:
* Extensive entrepreneurial experience of the promoters: The
promoters have long-standing presence in different businesses and
have established a healthy reputation in West Bengal.
Liquidity: Stretched
Liquidity risk profile of company is weak marked by high
debt-funded capital expenditure. Cash accruals are expected to be
over INR0.70 -0.75 crore which are sufficient against term debt
obligation of INR0.70 crore over the medium-term Bank limits were
utilized at 55% on an average through the past 12 months ended in
April 2022, while the utilization is expected to increase with
increased operations. Support from promoters is also available in
case of any exigencies. The client has already introduced unsecured
loan of Rs.1crore in Fy'22
Outlook: Stable
CRISIL Ratings believes PGIPL will continue to benefit from the
extensive experience of its promoters.
Rating Sensitivity factors
Upward Factors:
* Growth in topline by more than 40% leading to higher cash
accrual.
* Improvement in the capital structure and liquidity position.
Downward Factors:
* Decline in revenue by more than 30% leading to lower cash
accrual.
* Stretch in the working capital cycle.
Incorporated in 2018, PGIPL has a granite cutting and polishing
unit in Purulia, West Bengal, with installed capacity of 12 lakh
square feet per annum. The plant was commissioned in November 2019.
Mr Ajit Kumar Sarawgi, Mr Siddharth Sarawgi and Mr Yash Sureka are
the promoters.
RAMANI TIMBER: Ind-Ra Affirms B- LT Issuer Rating, Outlook Stable
-----------------------------------------------------------------
India Ratings and Research (Ind-Ra) has affirmed Ramani Timber
Corporation's (RTC) Long-Term Issuer Rating at 'IND B-'. The
Outlook is Stable.
The instrument-wise rating actions are:
-- INR55 mil. Fund-based working capital limits affirmed with
IND B-/Stable /IND A4 rating;
-- INR14.4 mil. (reduced from INR18.7 mil.) Term loan due on
February 2027 affirmed with IND B-/Stable rating; and
-- INR140 mil. Non-fund-based working capital limits affirmed
with IND A4 rating.
Key Rating Drivers
The affirmation reflects RTC's continued small scale of operations,
as indicated by revenue of INR182.73 million in FY22 (FY21:
INR209.01 million). The revenue declined by 12.5% yoy due to a fall
in the number of orders received by the company owing to lower
demand in the domestic market and the lingering impact of
COVID-19-led disruptions. Ind-Ra expects the revenue to remain
stable in FY23, with the normalizing of operations post the
pandemic. FY22 numbers are provisional in nature.
The ratings reflect RTC's modest EBITDA margins owing to the
trading nature of business. The margin declined to 4.1% in FY22
(FY21: 5.56%) due to an increase in raw material (imported timber)
prices. The firm's ROCE was 7.1% in FY22 (FY21: 9.3%). Ind-Ra
expects the margins to improve slightly in FY23, backed by a fall
in raw material prices.
Liquidity Indicator-Poor: RTC does not have any capital market
exposure and relies on banks and financial institutions to meet its
funding requirements. The firm's average maximum utilization of the
fund-based limits was 72.75% for the 12 months ended April 2022.
The working capital cycle elongated to 85 days in FY22 (FY21: 26
days) owing to an increase in the debtor days to 261 days (132
days). The cash flow from operations turned negative at IN4.71
million in FY22 (FY21: INR43.16 million) due to unfavorable changes
in the working capital. Ind-Ra expects the cash flow from
operations to marginally improve in FY23 due to a shorter working
capital cycle, led by a fall in debtor days. At FYE22, the
company's cash balance was INR0.3 million (FYE21: INR1.15 million).
The ratings are constrained by RTC's weak credit metrics due to the
modest margins. The credit metrics deteriorated in FY22 due to a
decrease in the absolute EBITDA to INR7.42 million (FY21: INR11.62
million). In FY22, the interest coverage (operating EBITDA/gross
interest expense) was 0.79x (FY21: 1.14x) and the net leverage
(adjusted net debt/operating EBITDA) was 14.73x (8.75x). Ind-Ra
expects the metrics to improve in FY23 due to scheduled debt
repayments.
The ratings, however, are supported by the promoters' experience of
three decades in the timber trading business, which has helped the
company establish strong relationships with customers as well as
suppliers.
Rating Sensitivities
Negative: A substantial decline in the revenue and the EBITDA
margin, leading to deterioration in the overall credit metrics and
weakening of the liquidity position, will lead to a negative rating
action.
Positive: An improvement in the liquidity position along with a
significant rise in the revenue and EBITDA margins, leading to the
gross interest coverage exceeding 1.3x, on a sustained basis, will
lead to a positive rating action.
Company Profile
RTC was established in 1985 as partnership firm. The firm is
engaged in the trading of timber in Trichy, Tamil Nadu.
RARE ROCKS: CRISIL Reaffirms B+ Rating on INR4.75cr Cash Credit
---------------------------------------------------------------
CRISIL Ratings has reaffirmed its 'CRISIL B+/Stable/CRISIL A4'
ratings on the bank facilities of Rare Rocks (RR).
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 4.75 CRISIL B+/Stable (Reaffirmed)
Cash Credit 0.25 CRISIL B+/Stable (Reaffirmed)
Letter of Credit 1.0 CRISIL A4 (Reaffirmed)
Packing Credit in
Foreign Currency 3.0 CRISIL A4 (Reaffirmed)
Proposed Fund-
Based Bank Limits 2.1 CRISIL B+/Stable (Reaffirmed)
Working Capital
Term Loan 0.65 CRISIL B+/Stable (Reaffirmed)
Working Capital
Term Loan 1.25 CRISIL B+/Stable (Reaffirmed)
The ratings continue to reflect the firm's modest scale of
operations, amidst intense competition and customer concentration
in revenue, and susceptibility to change in economic cycles in the
US and UK, and fluctuation in foreign exchange (forex) rates. These
weaknesses are partially offset by the extensive experience of the
partners in the granite industry.
Key Rating Drivers & Detailed Description
Weaknesses:
* Modest scale of operations amid intense competition and customer
concentration: Intense competition in the granite industry has kept
the scale of operations of RR modest, as reflected in revenue of
INR35 crore in fiscal 2022. Further, the top five customers
contribute over 70% of its sales and thus the firm remains exposed
to customer concentration risk.
* Susceptibility to economic cycles in overseas markets, and
fluctuation in forex rates: The firm derives a sizeable chunk of
income from granite exports to US and UK. Hence, revenue and
profitability remain vulnerable to economic cycles in these
markets, and sharp movement in forex rates.
Strengths:
* Extensive experience of the partners: The decade-long experience
of the partners in the granite industry, and their established
relationships with customers and suppliers, will continue to
support the business.
* Average financial risk profile: Networth is estimated at around
INR8 crore and gearing at 1.2 times as on March 31, 2022. The total
outside liabilities to tangible networth ratio has remained
satisfactory at an estimated 1.5 times. The debt coverage
indicators are likely to remain average over the medium term.
Liquidity: Stretched
Expected cash accrual of INR2 crore per annum over the medium term
will cover yearly debt obligation of INR0.9-1.0 crore. Bank limit
utilisation averaged a high 94.87% for the 12 months ended April
2022. Need-based funding support from the partners is expected to
continue.
Outlook: Stable
CRISIL Ratings believes RR will continue to benefit from the
extensive experience of its partners, and their established
relationships with key customers.
Rating Sensitivity factors
Upward factors
* Sustained growth in revenue and steady operating margin, leading
to cash accruals of over INR1.5 crore
* Improvement in financial risk profile
Downward factors
* Decline in revenue and/or profitability to less than 7% leading
to lower accruals
* Any large debt-funded capital expenditure, or substantial capital
withdrawals, weakening the financial risk profile.
RR was formed as a partnership firm by Mr Majeti Rakesh and family
members in 2010. Based in Andhra Pradesh, the firm processes and
exports granite blocks to the US and UK.
RAVINDRA BHARATHI: Ind-Ra Keeps 'D' Loan Rating in Non-Cooperating
------------------------------------------------------------------
India Ratings and Research (Ind-Ra) has maintained Ravindra
Bharathi Educational Society's bank facilities' ratings in the
non-cooperating category. The issuer did not participate in the
rating exercise despite continuous requests and follow-ups by the
agency. Therefore, investors and other users are advised to take
appropriate caution while using these ratings. The rating will
continue to appear as 'IND D (ISSUER NOT COOPERATING)' on the
agency's website.
The detailed rating actions are:
-- INR1,765.33 bil. Bank loans (Long-term) maintained in the non-
cooperating category with IND D (ISSUER NOT COOPERATING)
rating; and
-- INR250 mil. Fund-based working capital (Long-term) maintained
in the non-cooperating category with IND D (ISSUER NOT
COOPERATING) rating.
Note: ISSUER NOT COOPERATING: The rating was last reviewed on June
5, 2019. Ind-Ra is unable to provide an update as the agency does
not have adequate information to review the ratings.
Company Profile
Ravindra Bharathi Educational Society, registered under the
Societies Registration Act XXI of 1860, established its first
school at Nellore in 1994.
ROBIN POWER: Ind-Ra Assigns BB LT Issuer Rating, Outlook Stable
---------------------------------------------------------------
India Ratings and Research (Ind-Ra) has assigned F Robin Power
Solutions Private Limited (FRPSPL) a Long-Term Issuer Rating of
'IND BB'. The Outlook is Stable.
The instrument-wise rating action is:
-- INR1.0 bil. Proposed fund-based working capital limits
assigned with IND BB/Stable/IND A4+ rating.
Key Rating Drivers
The ratings reflect FRPSPL's lack of operational track record as it
commenced operations during FY21 and FY22 was the first full year
of operations. The ratings also factor in the company's medium
scale of operations as indicated by revenue of INR3,447 million in
FY22 (FY21: INR11.9 million), owing to increased demand for solar
panels by textile manufacturers in southern part of India. The
company imports Canadian solar panels from China, which are under
the top 10 demanded solar panels worldwide. Ind-Ra expects the
revenue to increase in the medium term due to its strong order book
of INR3,755 million as of June 2022, to be executed till September
2022. FY22 financials are provisional.
Liquidity Indicator - Poor: FRPSPL does not have any capital market
exposure and relies on a single bank and/or financial institution
to meet its funding requirements. The company has availed a working
capital limit of INR1,000 million to fund its day-to
day-operations, which is yet to be sanctioned. The cash flow from
operations stood at INR774.49 million in FY22 (FY21: INR2.36
million). Consequently, the free cash flow improved to INR605.08
million in FY22 (FY21: negative INR0.73 million). The net working
capital cycle was negative 123 days in FY22 (FY21:115 days). The
cash and cash equivalents (backed by customer advances) stood at
INR702.84 million at FYE22 (FYE21: INR0.20 million).
However, the ratings are supported by FRPSPL's healthy EBITDA
margins of 7.40% in FY22 (FY21: 9.66%) with a return on capital
employed of 137% (89.4%). However, Ind-Ra expects the EBITDA margin
to deteriorate in the near term as majority of its customers are
from the textile sector. The company received advances of INR3,031
million in FY22 and is predominantly dependent on customer advances
for its operations.
The ratings also benefit from the company's comfortable credit
metrics. The interest coverage (operating EBITDA/gross interest
expenses) of 87.66x in FY22 (FY21:28.75x) and the net leverage
(total adjusted net debt/operating EBITDAR) was negative 2.57x
(0.54x) as there was no debt on its balance sheet. Ind-Ra expects
the credit metrics to marginally deteriorate in the medium term,
due to debt-funded construction of a 200MWcolling sub-station
plant, of which 100MW would be completed by September 2022 and
remaining until March 2023.
The ratings are also supported by the promoters' nearly 15 years of
experience in the execution of engineering, procurement and
construction contracts. This has facilitated the company to
establish strong relationships with customers as well as
suppliers.
Rating Sensitivities
Positive: A significant increase in the scale of operations and
EBITDA margins, along with an improvement in the overall credit
metrics and liquidity profile, all on a sustained basis, could lead
to a positive rating action.
Negative: A decline in the scale of operations or orderbook and
EBITDA margins, leading to deterioration in the overall credit
metrics or liquidity profile, all on a sustained basis, could lead
to a negative rating action.
Company Profile
Incorporated in 2020, Tamil Nadu-based FRPSPL is engaged in
installing, erecting, testing and commissioning of all types of
solar power plants.
S. A. IRON: CRISIL Lowers Rating on INR20cr Term Loan to D
----------------------------------------------------------
CRISIL Ratings has downgraded the rating on the bank facilities of
S. A. Iron And Alloys Private Limited (SAPL) to 'CRISIL D' from
'CRISIL B/Stable'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 19 CRISIL D (Downgraded from
'CRISIL B/Stable')
Proposed Cash 1 CRISIL D (Downgraded from
Credit Limit 'CRISIL B/Stable')
Term Loan 20 CRISIL D (Downgraded from
'CRISIL B/Stable')
The rating reflects instances of delay in servicing debt
obligations in recent months on term loan availed by SAPL due to
weak liquidity.
The rating also reflects SAPL's susceptibility to raw material rate
fluctuations. However, the company benefits from extensive
experience of promoter in the iron and steel industry.
Key Rating Drivers & Detailed Description
Weaknesses:
* Instances of delays in servicing repayment towards term loan:
Owing to weak liquidity, the company has not been able to service
its repayment obligations towards its term loan in a timely
manner.
* Susceptibility to volatility in steel prices: The operating
margin has been volatile between 5.6- 8.7% in the last 3 years
ended March 31, 2022. The operating margins are expected to remain
volatile due to the volatility of raw material prices with the
company unable to pass on fluctuations to its customers at times.
Strengths:
* Extensive industry experience of the promoters: A presence of
more than a decade in the iron and steel industry has enabled the
promoters to understand market dynamics and establish a healthy
relationship with suppliers and customers. They have, over the
years, weathered the cyclicality inherent in the industry.
Liquidity: Poor
Liquidity is poor as indicated by instances of delay in repayments
in debt obligation towards term loan obligations in recent months.
Bank limits of INR19 crore were utilized at an average of 88% in
the 6-month period ending June 2022.
Rating Sensitivity factors
Upward Factors
* Timely servicing of debt consistently for three months
* Improvement in liquidity profile of the company
SAPL is a private limited company and was incorporated in 2003 and
is promoted by Mr. Arun Jain and Mr Subhash Chandra Aggarwal. SIPL
is engaged in the manufacturing of sponge iron and ingot/billet and
has also set up a captive power plant. The manufacturing facility
of SAPL is located at Ramnagar (Varanasi).
SARAF TRADING: Ind-Ra Affirms B+ LT Issuer Rating, Outlook Stable
-----------------------------------------------------------------
India Rating and Research (Ind-Ra) has affirmed Saraf Trading
Corporation Private Limited's (STCPL) Long-Term Issuer Rating at
'IND B+'. The Outlook is Stable.
The instrument-wise rating actions are:
-- INR140 mil. (increased from INR70 mil.) Fund-based working
capital limits affirmed with IND B+/Stable/IND A4 rating;
-- INR37.2 mil. (increased from INR17 mil.) Term loan due on
March 2027 affirmed with IND B+/Stable rating; and
-- INR7.5 mil. (increased from INR0.5 mil.) Non-fund-based
working capital limits affirmed with IND A4 rating.
Key Rating Drivers
The affirmation reflects STCPL's continued small scale of
operations, as indicated by revenue of INR412.7 million in FY22
(FY21: INR252.7 million). The revenue rose substantially in FY22 on
the back of higher demand from an Australia-based customer. Ind-Ra
expects STCPL's revenue to grow on a yoy basis in FY23, supported
by the overall business scenario returning to normalcy post the
disruptions caused by the pandemic. The figures for FY22 are
provisional.
The ratings also reflect STCPL's modest EBITDA margins due to the
nature of the business. The margin fell sharply to 3.0% in FY22
(FY21: 8.7%) on account of an increase in the cost of goods sold.
The ROCE was 3.0% in FY22 (FY21: 9.7%). Ind-Ra expects STCPL's
EBITDA margin to increase on a yoy basis in FY23, led by control
over the operating expenses.
The ratings factor in the company's weak credit metrics because of
the modest margins. The metrics deteriorated in FY22 on account of
an increase in the total debt to INR212.1 million (FY21: INR152.8
million), due to increased utilization of the fund-based limits,
and the fall in the absolute EBITDA to INR12.5 million (INR21.9
million). In FY22, the interest coverage (operating EBITDA/gross
interest expense) reduced to 1.3x (FY21: 4.1x) and the net leverage
(total adjusted net debt/operating EBITDAR) increased to 16.8x
(FY21: 6.8x). As on 31 March 2022, the total interest free
unsecured loans from directors/ shareholders stood at INR69.2
million (FY21: INR53.6 million), out of which only INR12.5 million
is subordinated debt. STCPL does not have any major debt-led capex
plans in the next two-to-three years. Ind-Ra expects the credit
metrics to improve in FY23 on account of the scheduled repayment of
term loans and the absence of any major debt-led capex plans.
Liquidity Indicator-Stretched: The average maximum utilization of
the fund-based limits was 91.4% over the 12 months ended May 2022.
In FY22, the cash flow from operations remained negative at INR36.2
million (FY21: negative INR28.4 million) on account of unfavorable
changes in the working capital. The cash and cash equivalent
remained low at INR1.4 million in FY22 (FY21: INR4.4 million). In
FY22, the net cash conversion cycle improved to 179 days (FY21: 240
days) on account of a reduction in inventory days to 125 days
(FY21: 223 days).
The ratings are constrained by the intense competition in the tea
processing industry and customer concentration. The tea industry is
price sensitive and is heavily dependent on certain geographies and
customers. STCPL faces high competition from organized as well as
unorganized players. Furthermore, in FY22, the top three customers
contributed around 67% to the total sales (FY21: 49%).
The ratings, however, continues to be supported by STCPL's
promoters' experience of three decades in the tea industry, which
has led to established relationships with customers and suppliers.
Rating Sensitivities
Negative: Any decline in the scale of operations or EBITDA margin,
leading to the interest coverage falling below 1.3x, and/or further
deterioration in the overall liquidity profile, could be negative
for the ratings.
Positive: Substantial growth in the scale of operations, while
maintaining the EBITDA margin, leading to the interest coverage
exceeding 1.7x, along with an improved liquidity position, could be
positive for the ratings.
Company Profile
STCPL was founded by V.G. Saraf in 1948 and incorporated in 1994.
It is engaged in the processing, blending and exporting of packaged
tea under the brand name of Suntips. It is located in Thoothukudi
(Tamil Nadu).
SAVI LEATHERS: Ind-Ra Hikes LT Issuer Rating to B+, Outlook Stable
------------------------------------------------------------------
India Ratings and Research (Ind-Ra) has upgraded Savi Leathers'
Long-Term Issuer Rating to 'IND B+' from 'IND D'. The Outlook is
Stable.
The instrument-wise rating actions are:
-- INR288 mil. (increased from INR150 mil.) Fund-based working
capital limits upgraded with IND B+/Stable/IND A4 rating;
-- INR60 mil. (reduced from INR80 mil.) Non-fund-based working
capital limits upgraded with IND A4 rating; and
-- INR107 mil. Term loans due on FY30 assigned with IND B+/Stable
rating.
The upgrade reflects the timely repayment of SL's debt obligations
since March 2022, along with its healthy profitability and average
credit metrics in FY22.
Key Rating Drivers
SL's EBITDA rose to INR138.2 million in FY22 (FY21: INR73.31
million; FY20: INR128.99 million), as the raw material cost
reduced, leading to an improvement in the credit metrics with the
gross interest coverage rising to 2.1x (1.39x; 2.53x) and net
leverage reducing to 3.3x (5.85x; 1.99x). Ind-Ra expects the credit
metrics to marginally deteriorate in FY23, owing to an addition in
the total debt to fund the capex for enhancing the installed
capacity of garments to 300,000 garments from 150,000; however,
scheduled repayments of term loans will keep the ratios at average
levels. The capex will be funded by an INR250 million term loan and
INR200 million of capital infusion. The management expects the
capex to commence from October-November 2022. The production and
revenue generation may commence from FY25. The Noida Government has
allotted a land of 1.5 acres worth INR123.7 million to SL, of which
20% i.e. INR24.8 million was paid upfront. The remaining amount
will be paid in 10 instalments within five years; the first
instalment has already been paid on 31 December 2021 through equity
infusion.
The revenue improved in FY22 to INR1,192.39 million in FY22 (FY21:
INR1,106.48 million; FY20: INR1,327.72 million), as the business
operations normalized post COVID-19; however, the scale of
operations remain small. Out of the total sales, 60% are to the
US, followed by Germany (15%-20%), Italy (10%), Netherland and
Australia. SL had an order book of INR1,300 million at end-June
2022, majorly from the US, to be executed in FY23. SL thus expects
to achieve revenue of INR1,600 million in FY23.
SL's EBITDA margins improved to average levels of 11.59% in FY22
(FY21: 6.63%, 9.71%) as the raw material cost reduced to 45.62%
(60.07%, 46.04%) with the resolution of supply chain issues through
the resumption of imports. The margins are supported by the export
incentives and duty drawbacks received by the company yearly. The
return on capital employed improved to 14% in FY22 (FY21: 8%; FY20:
19%). Ind-Ra expects the margins in FY23 to continue to be at the
FY22 level, as there is no change in the cost structure. Since the
partnership firm is majorly into exports and imports, the foreign
exchange risk is hedged naturally.
Liquidity indicator - Poor: The average month-end utilization of
fund-based working capital limits was 97.68% and non-fund-based
working capital limits for 12 months ended May 2022. The unutilized
fund-based limits were low at INR18.68 million as of May 31, 2022.
The cash and cash equivalents were also low at INR26.99 million in
FY22 (FY21: INR30.97 million), of which fixed deposits were
INR21.33 million (INR11.44 million). The cash flow from operations
are likely to have remained negative in FY22 owing to unfavorable
changes in working capital (FY21: negative INR210.87 million). The
working capital cycle deteriorated to 289 days in FY22 (FY21: 197
days) as the inventory days increased to 313 days (237 days),
because SL stocked inventory to avoid any shortage of raw
materials. Also, the payable days reduced to 78 days in FY22
(FY21: 108 days). The debt obligations for FY23 and FY24 are INR39
million and INR48.1 million, respectively. SL does not have any
capital market exposure and relies on single bank to meet its
funding requirements.
The partners have an experience of more than a decade in the
leather garments and accessories manufacturing industry. It
manufactures 150,000 garments, 3,000,000 belts, 300,000 big sized
bags, 1,000,000 small-sized bags per annum. It has four
manufacturing units, all located in Noida, which are running at
full capacity.
Rating Sensitivities
Negative: Any significant decline in the revenue or EBITDA margin,
leading to deterioration in the credit metrics with net leverage
exceeding 5x, on a sustained basis, would be negative for the
ratings.
Positive: Substantial improvement in the liquidity and improvement
in credit metrics, both on a sustained basis, would be positive for
the ratings.
Company Profile
Incorporated in 2009, SL manufactures and exports leather garments
and accessories. It is an export-oriented unit and has clients in
USA, Germany, Italy, the Netherlands and Australia.
SHIV METTALICKS: Ind-Ra Hikes Long-Term Issuer Rating to 'BB'
-------------------------------------------------------------
India Ratings and Research (Ind-Ra) has upgraded Shiv Mettalicks
Private Limited's Long-Term Issuer Rating to 'IND BB' from 'IND BB-
(ISSUER NOT COOPERATING)'. The Outlook is Stable.
The instrument-wise rating actions are:
-- INR160 mil. (increased from INR116 mil.) Fund-based facilities
upgraded with IND BB/Stable rating;
-- INR5.9 mil. (increased from INR4 mil.) Non-fund-based
facilities affirmed with IND A4+ rating; and
-- INR32.5 mil. Term loan due on December 2026 assigned with IND
BB/Stable rating.
The upgrade reflects the improvement in SMPL's revenue, absolute
EBITDA and interest coverage in FY22.
Key Rating Drivers
SMPL's revenue grew to INR1,413.36 million in FY22 (FY21: INR892.57
million) due to the increased prices of iron as well as the
improved demand for sponge iron as seen by the higher capacity
utilization of 80.2% in FY22 (FY21: 72.8%). Ind-Ra expects the
revenue to increase in FY23 due to the execution of a higher number
of orders. However, the scale of operations remains small. FY22
numbers are provisional in nature.
The ratings also reflect SMPL's continued healthy credit metrics
with gross interest coverage (operating EBITDA/gross interest
expense) of 5.02x (FY21: 3.61x) and net leverage (adjusted net
debt/operating EBITDAR) of 4.07x (1.7x) in FY22. The gross interest
cover improved in FY22 due to higher EBITDA and lower daily
utilization of fund-based facilities leading to lower interest
costs while the net leverage deteriorated due to an increase in the
total debt to INR196.96 million in FY22 (FY21: INR114.26 million)
and lower cash balances.
The modest EBITDA margins deteriorated to 3.4% in FY22 (FY21:
4.06%) due to increased raw material (iron ore) prices with a
return on capital employed of 7.6% in FY22 (FY21: 6%). However,
Ind-Ra expects the margins to improve marginally in FY23 as the
company plans to install a screener to remove the impurities in
iron ore which will lead to a cost saving of INR200-INR300 per
ton.
Liquidity Indicator - Stretched: The net working capital cycle
elongated to 90 days in FY22 (FY21: 78 days) due to an increase in
the inventory days to 105 (94). The cash flow from operations
turned negative at INR137.25 million in FY22 (FY21: INR52.92
million) due to unfavorable working capital changes. The average
maximum utilization of the fund-based limits was 80.25% during the
12 months ended April 2022. At FYE22, SMPL had cash and cash
equivalents of INR1.05 million (FYE21: INR52.65 million).
Furthermore, the company does not have any capital market exposure
and relies on banks and financial institutions to meet its funding
requirements.
The ratings are supported by the promoters' experience of more than
two decades in the sponge iron business leading to established
relationships with customers and suppliers.
Rating Sensitivities
Positive: An increase in the scale, profitability and liquidity
while maintaining the credit metrics, all on a sustained basis,
will lead to a positive rating action.
Negative: Deterioration in the scale of operations, liquidity and
credit metrics, all on a sustained basis, will be negative for the
ratings.
Company Profile
Established in 2004, SMPL manufactures sponge iron and has an
installed capacity of 60,000 metric tons per annum. The registered
office is in Odisha.
SHIVAM WOOD: Ind-Ra Cuts LT Issuer Rating to 'B', Outlook Stable
----------------------------------------------------------------
India Ratings and Research (Ind-Ra) has downgraded Shivam Wood
Works' (SWW) Long-Term Issuer Rating to 'IND B' from 'IND B+'. The
Outlook is Stable.
The instrument-wise rating actions are:
-- INR20 mil. (reduced from INR36 mil.) Fund-based working
capital limits Long-term downgraded and short-term affirmed
with IND B/Stable/IND A4 rating;
-- INR200 mil. Non-fund-based working capital limits affirmed
with IND A4 rating; and
-- INR26 mil. (increased from INR10 mil.) Term loan due on
February 2027 downgraded with IND B/Stable rating.
The downgrade reflects the fall in SWW's revenue, along with its
poor liquidity in FY22.
Key Rating Drivers
SWW's scale of operations remained small as its revenue declined to
INR266.24 million in FY22 (FY21: INR329.17 million), due to a fall
in the number of orders received by the company owing to the low
demand in the domestic market and the lingering impact of COVID.
Ind-Ra expects the scale of operations to remain small in FY23.
SWW's credit metrics are weak with the gross interest coverage
(operating EBITDA/gross interest expense) deteriorating to 1.24x in
FY21 (FY20: 1.32x) and the net leverage (adjusted net
debt/operating EBITDA) to 10.14x (8.68x), due to a fall in the
absolute EBITDA to INR16.16 million (INR21.32 million). Ind-Ra
expects the credit metrics to have remained weak despite improving
in FY22 due to a decrease in the fund-based working capital
utilization (the firm reduced its fund-based limits to INR20
million in FY22 from INR36 million in FY21) and the consequent
reduction in the interest cost.
Liquidity Indicator - Poor: The cash flow from operations decreased
marginally to INR13.72 million in FY21 (FY20: INR13.88 million),
due to unfavorable working capital changes. The working capital
cycle elongated to 88 days in FY21 (80 days) owing to an increase
in the inventory days to 71 (55). At FYE22, the firm's cash balance
was INR0.3 million (FYE21: INR0.6 million). The average maximum
utilization of SWW's fund-based working capital limits was 76.22%
for the 12 months ended April 2022. The use is likely to have been
on similar lines in May 2022. Furthermore, the firm does not have
any capital market exposure and relies on banks and financial
institutions to meet its funding requirements. There has not been
any substantial withdrawal of capital by the partners since FY18
and Ind-Ra understands that this will continue over the
near-to-medium term. SWW's disclosure standards are in line with
the agency's corporate governance criteria for its rating level;
this is likely to continue.
SWW's EBITDA margins were modest at 4.91% in FY21 (FY20: 5.25%),
owing to the trading nature of its business. The firm's EBITDA
margin declined in FY21 due to an increase in raw material
(imported timber) prices. The company's return on capital employed
was 10.7% in FY21 (FY20: 12.8%). Ind-Ra expects the margins to have
remained at similar levels in FY22 due to the nature of business.
The ratings, however, continue to be supported by the promoters'
experience of three decades in the trading of timber which has
helped the firm establish strong relationships with customers as
well as suppliers.
Rating Sensitivities
Negative: A decline in the revenue or the EBITDA margin, leading to
any deterioration in the overall credit metrics, along with
deterioration in the liquidity will lead to a negative rating
action.
Positive: A significant rise in the revenue and the EBITDA margin,
leading to the interest coverage exceeding 1.5x, along with a
further improvement in the liquidity position will lead to positive
rating action.
Company Profile
SWW was established in 1999 as a partnership firm and is engaged in
the trading of timber in Trichy (Tamil Nadu).
SHIVANI LOCKS: CRISIL Withdraws B+ Rating on INR25cr Term Loan
--------------------------------------------------------------
CRISIL has revised the ratings on certain bank facilities of
Shivani Locks Private Limited (SLPL), as:
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 15 CRISIL B+/Stable/Issuer Not
Cooperating (Withdrawn)
Letter of Credit 1 CRISIL A4/Issuer Not
Cooperating (Withdrawn)
Proposed Long Term 4 CRISIL B+/Stable/Issuer Not
Bank Loan Facility Cooperating (Withdrawn)
Term Loan 25 CRISIL B+/Stable/Issuer Not
Cooperating (Withdrawn)
CRISIL Ratings has been consistently following up with SLPL for
obtaining information through letters and emails dated June 30,
2021 and July 20, 2021 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
Ratings failed to receive any information on either the financial
performance or strategic intent of SLPL. This restricts CRISIL
Ratings' ability to take a forward-looking view on the credit
quality of the entity. CRISIL Ratings believes that rating action
on SLPL is consistent with 'Assessing Information Adequacy Risk'.
CRISIL Ratings has Continues the ratings on the bank facilities of
SLPL to 'CRISIL B+/Stable/CRISIL A4 Issuer not cooperating'.
CRISIL Ratings has withdrawn its rating on the bank facilities of
SLPL on the request of the company and after receiving no objection
certificate from the bank. The rating action is in-line with CRISIL
Rating's policy on withdrawal of its rating on bank loan
facilities.
CRISIL Ratings has consolidated the business and financial risk
profile of SLPL with its group companies Venus Stampings Private
Limited (VSPL) and Venus Industrial Corporation Pvt Ltd (VICPL),
together referred as the Venus group, as all the companies are
engaged in similar line of business and have common management.
About the Group
SLPL was incorporated in 1988 by Mr. D N Kathuria, Mr. K L
Kathuria, Mr. Naresh Kathuria and Mr. Raj Kathuria. The company is
engaged in the manufacturing of precision sheet metal components,
primarily, to the automotive industry. The company's manufacturing
facilities are situated at Faridabad, Haryana.
VICPL was incorporated in 1996 by Mr. D N Kathuria, Mr. R D
Kathuria & Mr. K L Kathuria. The company is engaged in the
manufacturing of precision sheet metal components, primarily, to
the automotive industry. The company's manufacturing facilities are
situated at Faridabad, Haryana.
VSPL was incorporated in 1985 by Mr. KrishanLal Kathuria and
family. The company is engaged into manufacturing of electrical
lamination for electric motors, starter motors, alternators, wiper
motors, radiator fan motors, switch gear controls and energy
meters. The company's manufacturing facilities are situated at
Faridabad, Haryana.
SIR BIOTECH: Ind-Ra Keeps 'D' LT Issuer Rating in Non-Cooperating
-----------------------------------------------------------------
India Ratings and Research (Ind-Ra) has maintained Sir Biotech
India Limited's Long-Term Issuer Rating of 'IND D (ISSUER NOT
COOPERATING)' in the non-cooperating category and has
simultaneously withdrawn it.
The instrument-wise rating actions are:
-- INR15 mil. Term loan-1 (long-term)# due on March 2018 is
withdrawn;
-- INR506.25 mil. Term loan-2 (long-term)* due on March 2028
maintained in non-cooperating category and withdrawn;
-- INR568.75 mil. Term loan-3 (long-term)* due on March 2028
maintained in non-cooperating category and withdrawn;
-- INR325.0 mil. Term loan-4 (long-term)* due on March 2027
maintained in non-cooperating category and withdrawn; and
-- INR150 mil. Non-fund-based facility (short-term)# is
withdrawn.
*Maintained at 'IND D (ISSUER NOT COOPERATING)' before being
withdrawn.
# No-dues certificate received
Key Rating Drivers
Ind-Ra has maintained the ratings in the non-cooperating category
because the issuer did not participate in the rating exercise,
despite requests by the agency and has not provided information
pertaining to full-year financial performance for FY21, sanctioned
bank facilities and utilization, business plan and projections for
the next three years, information on corporate governance, and
management certificate.
Ind-Ra is no longer required to maintain the ratings, as the agency
has received no-objection certificates and no dues certificates
from the lenders. This is consistent with the Securities and
Exchange Board of India's circular dated March 31, 2017 for credit
rating agencies. Ind-Ra will no longer provide analytical and
rating coverage.
Company Profile
Incorporated in 1995, Sir Biotech India is engaged in the trading
of iron ore, plastic polymer, raw cotton, copper rods, alkaline
battery and metal products, and the processing of peanuts. It is
also engaged in the hospitality and real estate businesses.
SOUMAK FLOATING: CRISIL Assigns B Rating to INR9.90cr Term Loan
---------------------------------------------------------------
CRISIL Ratings has assigned its 'CRISIL B/Stable/CRISIL A4' ratings
to the bank facilities of Soumak Floating Feed Mills Pvt Ltd
(SFFMPL).
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Bank Guarantee 0.56 CRISIL A4 (Assigned)
Cash Credit 2.06 CRISIL B/Stable (Assigned)
Proposed Fund-
Based Bank Limits 2.48 CRISIL B/Stable (Assigned)
Term Loan 9.90 CRISIL B/Stable (Assigned)
The ratings reflect the company's susceptibility to fluctuations in
raw material prices, intense competition and regulatory risks, and
its leveraged capital structure. These weaknesses are partially
offset by the extensive experience of the promoters.
Key rating drivers and detailed description
Weaknesses:
* Susceptibility to fluctuations in raw material prices, intense
competition, and regulatory risks: The fish feed industry is highly
competitive due to presence of numerous unorganized players, which
exerts pricing pressure on individual entities. This company has to
remain cost competitive to maintain profitability.
* Leveraged capital structure: The financial risk profile is
average, constrained by high gearing and moderate debt protection
metrics. The project was aggressively funded through a
debt-to-equity ratio 3:1 times. Networth remained modest at INR2.26
crore in fiscal 2022 but is estimated to improve over the medium
term supported by equity infusion and steady accretion to
reserves.
Strength:
* Extensive industry experience of the promoters: Experience of
more than 20 years through other businesses has enabled the
promoters to get an understanding of the market dynamics and helped
establish relationships with suppliers and customers.
Liquidity: Stretched
Cash accrual is expected at INR1.6-2.6 crore against term debt
obligation of INR1.08 crore over the medium term. Current ratio was
moderate estimated at 1.24 times on March 31, 2022. The promoters
are likely to extend support in the form of unsecured loans to meet
working capital requirements and debt obligations.
Outlook: Stable
CRISIL Ratings believes SFFMPL will continue to benefit from the
extensive experience of its promoters and established relationships
with clients.
Rating sensitivity factors
Upward factors
* Timely stabilization of operations and ramp-up of revenue and
profitability
* Substantial improvement in the financial risk profile
Downward factors
* Significantly low cash accrual in initial phase of operations
* Substantial increase in working capital requirement weakening
liquidity and financial risk profile
SFFMPL was incorporated in 2020 to set up a unit for floating feed
for fish with capacity of 3 tonne of fish feed per hour.
The company is promoted and managed by Mr Sambhu Pal, Mr Gunakar
Paul, Mr Santanu Paul and started commercial operations in March
2022.
SPAHJ INDIA: CRISIL Assigns B Rating to INR20cr Proposed Loan
-------------------------------------------------------------
CRISIL Ratings has assigned its 'CRISIL B/Stable' ratings to the
bank facilities of Spahj India Trading Private Limited (SITPL).
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Proposed Working
Capital Facility 20 CRISIL B/Stable (Assigned)
The rating reflects SITPL's modest scale of operations, low
operating margins due to trading nature of the business, and weak
financial profile. These weaknesses are partially offset by the
extensive industry experience of its promoters.
Key Rating Drivers & Detailed Description
Weaknesses
* Modest scale of operations: SITPL's operations have commenced in
fiscal 2022 and its business profile is constrained by the modest
scale of operations. Revenue is estimated to be INR33.34 crore for
fiscal 2022. SITPL's scale of operations will continue to limit its
operating flexibility over the medium term.
* Low operating margins due to competition and trading nature of
the business: The moderate initial investment and the low
complexity of operations have resulted in existence of many
players, leading to significant fragmentation and low operation
margins. Operating margin may remain modest over the medium term,
constrained by the trading nature of business and limited
bargaining power with customers.
* Weak financial profile: SITPL has a weak financial profile marked
by a low networth of INR0.19 crore and high total outside
liabilities to adj tangible networth (TOL/ANW) of 38.90 for year
ending on 31st March 2022. SITPL's debt protection measures have
also been at weak level in past due to high gearing and low
accruals from the operations. The interest coverage and net cash
accrual to total debt (NCATD) ratio are at 43.1 times and 0.04
times for fiscal 2022. SITPL's debt protection measures are
expected to remain at similar level with high debt levels.
Strengths
* Extensive industry experience of the promoters: The promoters
have a total business experience of over 3 decades. Their
experience in trading activities has given them an understanding of
the dynamics of the market and enabled them to establish
relationships with suppliers and customers. The promoters run
another company Aqua World Exports Private Limited (CRISIL
B+/Stable), which is involved in packing and exporting of marine
products.
Liquidity: Stretched
Liquidity is stretched due to working capital-intensive nature of
operations. Cash accruals are expected to be over INR1-4 crore
which are sufficient against no major term debt obligation over the
medium term. Current ratio is low at 0.66 times on March 31, 2022.
Outlook Stable
CRISIL Ratings believes that SITPL will continue to benefit from
its promoter's extensive industry experience over the medium term.
Rating Sensitivity factors
Upward factor
* Revenue growing above INR100 crore over the medium term while
ensuring margin above 3% on a consistent basis
* Improvement in financial risk profile with TOLTNW below 5 times.
Downward factors
* If its business stagnant due to weak demand or a stretch in
receivables or pile-up of inventory adversely affects liquidity
* Stretch in working capital cycle, with gross current assets
growing above 150 days
SITPL was incorporated in 2019 by Anupama Haridas and Shreedharan
Pillai Haridas. The company is engaged in business of trading of
metals, non-metals, plant and machineries, used vehicles,
miscellaneous scrap, surplus items, etc in Andaman and Tamil Nadu.
Company has also ventured into the pharma sector focusing on
supplying pharma products to government and private institutions.
SPICEJET LTD: Has Problems Over and Above INR10.29BB in Losses
--------------------------------------------------------------
Gulf News reports that even as new airlines get ready to fly in
India, SpiceJet, one of the older carriers, is not having such a
good time of it. Gulf News says the low-cost operator received a
show cause notice from the country's aviation regulator last week,
while its aircraft suffered several mid-air lapses over the last
month and has many in the industry concerned about its future.
According to Gulf News, the airline, which came back from near
bankruptcy in 2014, saw annual losses nearly triple to INR10.29
billion in the last financial year compared to 2019 figures.
SpiceJet, which recently settled a lawsuit over non-payment of dues
to a Swiss MRO firm, has been put in the 'cash-and-carry' category
by many of its suppliers - this means the carrier can buy spare
parts only on immediate payment, the report says.
"Nobody wants to lend to SpiceJet, and they have gotten themselves
into this really bad position," Gulf News quotes an industry source
as saying. Last year, Crisil Ratings withdrew its 'Crisil D' credit
ratings after the company did not provide information essential to
take a forward-looking view on its credit quality.
"A lot of the issues are because of pure maintenance
mismanagement," the source, as cited by Gulf News, said. "The
airline need a maintenance engineering guide to be proactive and
fix problems pre-emptively."
This could be an oversimplification of what's happening at the
airline, Gulf News notes. "SpiceJet has been on cash-and-carry for
a while," Gulf News quotes Vinamra Longani, head of operations at
Sarin & Co, an aviation law firm, as saying.
In a statement to 'Gulf News', SpiceJet called the recent incidents
"isolated" and said that initial investigation did not indicate a
specific maintenance issue in the airline's fleet. "Preventive
actions are formulated, implemented and audited frequently to
ensure no recurrence of a similar nature occurs in the future," the
airline said.
"The fact that we have had the highest load factor among all
domestic airlines shows we are the most preferred and trusted
airline in the country. Our current occupancy rates continue to be
the highest in the country."
In May, SpiceJet delivered a load factor at around 89% followed by
Go First at 86.5%, Gulf News discloses citing a DGCA's report. It
also showed that Indian carriers flew 12 million passengers on
domestic routes in May compared to just 2.1 million in the same
period a year earlier.
Gulf News says SpiceJet's problems came to the regulator's
attention after a Delhi-Dubai flight was diverted to Karachi due to
a malfunctioning indicator. On the same day, the airline's
Kandla-Mumbai flight got a cracked windshield during cruise. In
June, a Delhi-Patna flight was thought to have caught fire after
the Boeing 737-800 was seen with a trail of smoke.
On July 11, a SpiceJet flight (SG23) operating from Dubai to
Madurai was delayed due to a last-minute technical issue, the
report says. "Flight delays can happen with any airline - there has
been no incident or a safety scare on this flight," said the
airline in a statement.
Due to these glitches and the DGCA's notice, SpiceJet's shares are
down 44% this year, Gulf News notes. Shares of Indigo, which is
seeing some cancellations due to staff shortages, are down 16%
since the beginning of 2022.
About SpiceJet
SpiceJet Limited -- http://www.spicejet.com/-- is an India-based
low-budget air carrier. The Company operates daily flights between
major cities in India. The carrier is India's second-biggest budget
airline, after IndiGo.
As reported in the Troubled Company Reporter-Asia Pacific on Jan.
4, 2022, auditors have cast a doubt on the ability of debt-laden
SpiceJet, to remain a going concern as its net worth has eroded.
In the annual report for FY21, the independent auditors pointed out
that SpiceJet has defaulted on tax payments, GST payments and
employee provident fund dues in FY21 totalling INR90 crore,
according to The Hindu BusinessLine.
SUBIR DIAMONDS: Ind-Ra Moves 'B' Issuer Rating to Non-Cooperating
-----------------------------------------------------------------
India Ratings and Research (Ind-Ra) has migrated Subir Diamonds Pvt
Ltd.'s Long-Term Issuer Rating of 'IND B (ISSUER NOT COOPERATING)'
to the non-cooperating category and has simultaneously withdrawn
it.
The instrument-wise rating action is:
-- INR90 mil. Fund-based limits migrated to non-cooperating
category and withdrawn;
*Migrated to 'IND B (ISSUER NOT COOPERATING)' before being
withdrawn
Key Rating Drivers
Ind-Ra has migrated the ratings in the non-cooperating category
because the issuer did not participate in the rating exercise,
despite requests by the agency and has not provided information
pertaining to full-year financial performance for FY21, sanctioned
bank facilities and utilization, business plan and projections for
the next three years, information on corporate governance, and
management certificate.
Ind-Ra is no longer required to maintain the ratings, as the agency
has received no-objection certificates from the lenders. This is
consistent with the Securities and Exchange Board of India's
circular dated March 31, 2017 for credit rating agencies. Ind-Ra
will no longer provide analytical and rating coverage.
Company Profile
Subir Diamonds was incorporated in 1982 as a private limited
company. Its registered office is located in Mumbai. The company
trades and manufactures rough, cut and polished diamonds.
SWARGIYA BHIKAM: Ind-Ra Keeps BB Loan Rating in Non-Cooperating
---------------------------------------------------------------
India Ratings and Research (Ind-Ra) has maintained Swargiya Bhikam
Singh Smriti Samaj Kalyan Sansthan's bank loan rating in the
non-cooperating category. The issuer did not participate in the
rating exercise despite continuous requests and follow-ups by the
agency. Therefore, investors and other users are advised to take
appropriate caution while using the rating. The rating will
continue to appear as 'IND BB (ISSUER NOT COOPERATING)' on the
agency's website.
The detailed rating action is:
-- INR74.28 mil. Bank loans maintained in non-cooperating
category with IND BB (ISSUER NOT COOPERATING) rating.
Note: ISSUER NOT COOPERATING: The rating was last reviewed on July
10, 2015. Ind-Ra is unable to provide an update, as the agency does
not have adequate information to review the ratings.
Company Profile
Swargiya Bhikam Singh Smriti Samaj Kalyan Sansthan was established
in 1998 under the Societies Registration act, 1973 in Gwalior,
Madhya Pradesh. It manages two colleges and offers nursing,
computer application and business administration courses. The
society also has a 350-bed hospital.
UNITED TECHFAB: CRISIL Lowers Rating on INR23.35cr Term Loan to B
-----------------------------------------------------------------
CRISIL Ratings has revised the ratings on bank facilities of United
Techfab Private Limited (UTPL) 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 1 CRISIL A4 (ISSUER NOT
COOPERATING; Revised from
'CRISIL A4+ ISSUER NOT
COOPERATING')
Cash Credit 2 CRISIL B/Stable (ISSUER NOT
COOPERATING; Revised from
'CRISIL BB-/Stable ISSUER
NOT COOPERATING')
Proposed Long Term 2 CRISIL B/Stable (ISSUER NOT
Bank Loan Facility COOPERATING; Revised from
'CRISIL BB-/Stable ISSUER
NOT COOPERATING')
Term Loan 23.35 CRISIL B/Stable (ISSUER NOT
COOPERATING; Revised from
'CRISIL BB-/Stable ISSUER
NOT COOPERATING')
CRISIL Ratings has been consistently following up with UTPL for
obtaining information through letters and emails dated March 14,
2022 and May 30, 2022 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
Ratings failed to receive any information on either the financial
performance or strategic intent of UTPL, which restricts CRISIL
Ratings' ability to take a forward-looking view on the entity's
credit quality. CRISIL Ratings believes that rating action on UTPL
is consistent with 'Assessing Information Adequacy Risk'. Based on
the last available information, the ratings on bank facilities of
UTPL revised to 'CRISIL B/Stable/CRISIL A4 Issuer Not Cooperating'
from 'CRISIL BB-/Stable/CRISIL A4+ Issuer Not Cooperating'.
Incorporated in 2012, UTPL is engaged in the manufacturing of grey
denim fabrics. The company also does job work of manufacturing of
grey denim fabric.
UTHARA FASHION: Insolvency Resolution Process Case Summary
----------------------------------------------------------
Debtor: Uthara Fashion Knitwear Limited
57, Elango Street
Mahalingapuram
Pollachi 642002
Coimbatore District
TN, IN
Insolvency Commencement Date: July 1, 2022
Court: National Company Law Tribunal, Chennai Bench
Estimated date of closure of
insolvency resolution process: December 28, 2022
(180 days from commencement)
Insolvency professional: Thilagar Murugesan
Interim Resolution
Professional: Thilagar Murugesan
28/532, Lifestyle Apartment
Perundurai Road
Erode 638011
Tamilnadu
E-mail: mthilagar@tacas.org
Last date for
submission of claims: July 21, 2022
VANILLA CLEAN: Ind-Ra Affirms B+ LT Issuer Rating, Outlook Stable
-----------------------------------------------------------------
India Ratings and Research (Ind-Ra) has taken the following rating
actions on Vanilla Clean Power Private Limited's (VCPPL) debt
facilities:
-- INR1,785.82 bil. (reduced from INR2.30 bil.) Term loan due on
June 30, 2030 affirmed; Outlook revised to Positive from
Stable with IND BB-/Positive rating;
-- INR210 mil. Overdraft affirmed; Outlook revised to Positive
from Stable with IND BB-/Positive rating; and
-- INR203.3 mil. Term loan assigned with IND BB-/Positive rating.
The Positive Outlook reflects VCPPL's improved operational and
financial performance in FY22, with adequate liquidity in the
project for about 11 months of debt servicing, stemming from the
reduced payment cycle from the counterparties.
Key Rating Drivers
The plant load factor (PLF) improved to 18.74% during FY22 (FY21:
15.28%), higher than the P90 levels (16.6%), owing to an
improvement in machine availability. During FY17-FY20, the PLF had
been low due to weak machine availability and wind resource
volatility. However, a change in its operations and maintenance
contractor to Renom Energy Services LLP on 16 May 2019 augured well
for VCPPL, and its machine availability increased to 96.5% in FY22
(FY21: 94.4%).
In January 2022, VCPPL created a debt service reserve (DSR) worth
INR212 million, equivalent to two quarters' principal and interest
due, primarily funded from the proceeds of a loan under the
emergency credit line guarantee scheme (ECLGS) worth INR203.3
million. This provides a buffer for managing the volatile payment
cycle from counterparties. The management has stated that the
increase in debt repayments from 4QFY23 due to the ECLGS loan will
be managed by reducing the management service fees paid to its
sponsor, Leap Green Energy Private Limited (LGEPL).
Liquidity Indicator – Adequate: As of June 14, 2022, VCPPL had
consolidated liquidity of INR441.6 million (including free cash,
unutilized working capital and debt service reserve account
(DSRA)), equivalent to about 11 months of debt servicing. VCPPL
reduced its reliance on the working capital limits of INR210
million (average maximum utilization of 66% in the six months ended
April 2022) to manage delays from its counterparties - Jodhpur
Vidyut Vitran Nigam Limited (Jodhpur discom) and Ajmer Vidyut
Vitran Nigam Limited (Ajmer discom).
VCPPL received payments from both the counterparties for about
six-to-seven months of billing until December 2021 in March 2022,
and received regular payments within 70 days thereafter.
A DSRA equivalent to six months of debt servicing is available to
manage volatility in payment receipts from counterparties. In FY22,
the receivable days for the Jodhpur discom and Ajmer discom reduced
to 146 days (FY21: 266 days) and 130 days (FY21: 144 days),
respectively. Ind-Ra has analyzed the debt service coverage ratio
based on VCPPL's total term loan of INR1,989.12 million (including
ECLGS loan) as of May 30, 2022. The ECLGS loan has a one-year
moratorium and equal monthly amortization for four years.
Moreover, Ind-Ra has taken comfort from the support provided by
LGEPL to VCPPL in FY22. LGEPL has also stated that it will continue
to support VCPPL before accessing the DSRA. The company has a cross
default with respect to Ivy Ecoenergy India Private Limited
(another special purpose vehicle company owned by the sponsor). Any
deterioration in the liquidity or financial profile of Ivy
Ecoenergy India might constrain the rating of VCPPL.
The ratings are supported by the presence of VCPPL's 25-year power
purchase agreements with the Jodhpur distribution company for 56MW
capacity and the Ajmer discom for the balance 8MW capacity, at a
fixed tariff of INR5.18/kWh.
The ratings are supported by the annual generation-based incentive
(GBI) of INR0.50/unit that VCPPL is entitled to receive from Indian
Renewable Energy Development Agency Limited ('IND AA+'/ Stable)
until FY23. While Indian Renewable Energy Development Agency is a
financially strong counterparty, any material delay in GBI payments
could affect VCPPL's liquidity. As of December 2021, the company
had received the GBI payments for the bills raised until June 2021,
amounting to a total of INR47.92 million.
Rating Sensitivities
Negative: A depletion of DSRA to less than three months, an
increase in the receivable days, and PLF levels falling below
16.5%, on a sustained basis, may result in a rating downgrade.
Positive: The operating and financial performance being sustained
at existing levels, leading to an improvement in the debt service
coverage ratio to 1.10x and receivable days sustaining at six
months for a continuous period of 12 months might lead to a rating
upgrade.
Company Profile
VCPPL is a special purpose vehicle formed by LGEPL to operate two
wind farms in Jaisalmer, Rajasthan. These plants were acquired from
Inox Renewables (Jaisalmer) Limited on a slump sale basis in August
2017.
VISHAL CONSTRUCTION: CRISIL Moves B Rating to Not Cooperating
-------------------------------------------------------------
CRISIL Ratings has migrated the rating on bank facilities of Vishal
Construction (VC) to 'CRISIL B/Stable/CRISIL A4 Issuer not
cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Bank Guarantee 5.55 CRISIL A4 (ISSUER NOT
COOPERATING; Rating Migrated)
Cash Credit 3 CRISIL B/Stable (Issuer Not
COOPERATING; Rating Migrated)
Proposed Fund- 1.45 CRISIL B/Stable (Issuer Not
Based Bank Limits COOPERATING; Rating Migrated)
CRISIL Ratings has been consistently following up with VC for
obtaining information through letters and emails dated June 20,
2022 and June 25, 2022 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
Ratings failed to receive any information on either the financial
performance or strategic intent of VC, which restricts CRISIL
Ratings' ability to take a forward-looking view on the entity's
credit quality. CRISIL Ratings believes that rating action on VC is
consistent with 'Assessing Information Adequacy Risk'. Therefore,
on account of inadequate information and lack of management
cooperation, CRISIL Ratings has migrated the rating on bank
facilities of VC to 'CRISIL B/Stable/CRISIL A4 Issuer not
cooperating'.
VC is a partnership firm set up in 1996 by Mr Vikas Kakad and Ms
Shakuntala Kakad. Based in Mumbai, the firm primarily undertakes
construction of bridges in Maharashtra.
=================
I N D O N E S I A
=================
SAWIT SUMBERMAS: S&P Downgrades ICR to 'CC', Outlook Negative
-------------------------------------------------------------
On July 13, 2022, S&P Global Ratings downgraded its long-term
issuer credit rating on Indonesian palm oil producer Sawit
Sumbermas Sarana Tbk. PT (SSMS) to 'CC' from 'CCC'. S&P removed the
ratings from CreditWatch, where they were placed with developing
implications on July 1, 2022.
The negative rating outlook reflects that S&P will lower its issuer
credit rating on SSMS to 'SD' (selective default) on settlement of
the transaction.
SSMS has obtained consent from the majority of noteholders for a
proposed below-par cash tender for its guaranteed senior unsecured
notes. S&P views this transaction as tantamount to a distressed
transaction and a default because the creditors will receive less
than the full value they were originally promised.
S&P lowered its ratings after SSMS obtained consent from the
majority of noteholders for a proposed below-par cash tender for
its guaranteed senior unsecured notes.
S&P said, "Once the cash tender is formally completed on July 14,
2022, we expect to lower the ratings to 'SD'. This is given our
views of: (1) unsecured noteholders receiving less than what was
originally promised because the cash tender of 90 cents is below
par and will be for US$260 million, representing about 85% of the
outstanding US$300 million notes; and (2) the tender offer comes
just a little over two quarters from the maturity of the notes.
"We will reassess and likely raise our ratings on SSMS to the
appropriate level after the new capital structure has been
instated. We will focus on the sustainability of the new capital
structure and SSMS' business prospects."
Any upward rating momentum would depend on increased transparency
on the terms of the syndicated debt facility – including its
amortization profile and main covenants.
SSMS' governance issues and weak risk management practices will
remain a key credit consideration, given the recurring financial
support SSMS provides to related entities at the expense of its own
financial viability. A rating beyond the 'CCC' category would
depend on greater visibility on the wider group's financial
performance. S&P said, "Particularly, we would assess the liquidity
of the parent Citra Borneo Indah PT (CBI) and palm oil refining
sister company Citra Borneo Utama PT (CBU), as well as the
potential cash leakage within the wider group. This is because we
believe SSMS's liquidity would be sufficient to repay the residual
US$40 million noteholders in full when the notes mature in January
2023, barring any cash leakage."
The operating performance of the wider group seems to have
stabilized in the past few quarters. CBU benefited from better
pricing conditions for refined palm oil products. Based on CBU's
financial disclosures for the quarter ended March 31, 2022, the
company posted its fourth consecutive quarter of net profits.
Moreover, SSMS reported EBITDA of Indonesian rupiah (IDR) 1.2
trillion over the same quarter, about 60% of its 2021 full-year
earnings. Visibility over the debt structure of CBI remains limited
because the company has stopped disclosing its financial statements
since September 2020.
S&P said, "The negative rating outlook reflects that we would lower
our issuer credit rating on SSMS to 'SD' upon settlement of the
cash tender for the company's guaranteed senior unsecured notes.
"We would lower our issuer credit rating on SSMS to 'SD' when the
cash tender is completed.
"We consider any upside to the ratings as highly unlikely because
the majority of the noteholders have consented to the cash tender.
We will reassess and likely raise our ratings on SSMS to the
appropriate level after the new capital structure has been instated
post transaction close."
ESG credit indicators: E-5, S-2, G-5
=========
J A P A N
=========
JPA NO. 111: Unsecureds Unimpaired Under Joint Chap. 11 Plan
------------------------------------------------------------
JPA No. 111 Co., Ltd. and JPA No. 49 Co., Ltd. submitted a Joint
Chapter 11 Plan of Reorganization and a Disclosure Statement.
Pursuant to the Sale and Global Settlement, the Debtors received $5
million in cash to their estates and obtained the rights to receive
the proceeds of the VNA Claims (Seller) Portions valued at roughly
$7 million. The Plan provides that (a) the Debtors will use cash
on hand, including the proceeds of the Sale, to pay all remaining
administrative, priority, and unsecured claims in full on the
effective date of the Plan to the extent not paid prior to the
Effective Date in accordance with the Bankruptcy Code and the Plan
or thereafter as such claims may be reconciled and allowed, and (b)
any remaining cash, including on account of the VNA Claims (Seller)
Portions, will remain with the Debtor for the ultimate benefit of
JP Lease Products & Services Co. Ltd. ("JPL"), the sole remaining
creditor and the sole equity holder of each of the Debtors.
Subsequent to the Sale Ruling, the JPA Parties, the FitzWalter
Parties, the Intermediate Lessors, and the Purchasers, and the
foregoing parties' respective agents, officers, directors, and
affiliates (the "Settlement Parties") negotiated a global
resolution of all material issues impacting the Chapter 11 Cases
and the Sale (including the Sale Objections) and entered into that
certain Settlement Addendum, dated March 25, 2022 (the "Global
Settlement"). The Global Settlement paved the way for the entry of
a consensual order approving the Sale and provided for the mutual
release of actual and potential claims and causes of action by and
among the Settlement Parties and their respective Related Parties
(as defined in the Global Settlement).
Among other things, the Global Settlement provided that, upon
closing of the Sale, (a) the Stalking Horse Bidders agreed to pay
an amount to FitzWalter as part of the Sale to settle certain
disputed amounts asserted as secured obligations and identified by
the Bankruptcy Court in the Sale Ruling, (b) FitzWalter agreed to
withdraw the FitzWalter Appeal with prejudice, (c) FitzWalter
agreed to withdraw certain claims it had asserted against certain
of the Debtors' non-debtor affiliates, including JPL, JPLS Ireland,
and Heinrich Loechteken, a director of the Debtors, in England, (d)
the Debtors agreed to withdraw an adversary complaint filed against
FitzWalter in the Bankruptcy Court relating to FitzWalter's
prepetition foreclosure and enforcement process as well as certain
alleged actions taken during the Chapter 11 Cases, and (e) all
parties to the settlement agreed to execute mutual releases as
provided in the Global Settlement.
On March 25, 2022, the Bankruptcy Court entered an order (the "Sale
Order") approving, among other things, (a) the Sale to affiliates
of the Stalking Horse Bidders (the "Purchasers") pursuant to the
purchase agreements attached to the Sale Order as Exhibit A and
Exhibit B (together, the "Stalking Horse Purchase Agreements") and
(b) the Global Settlement. The closing of the MSN 173 Stalking
Horse Purchase Agreement (as defined in the Sale Order) occurred on
June 14 (the "MSN 173 Closing"). The closing of the MSN 067
Stalking Horse Purchase Agreement (as defined in the Sale Order)
occurred on June 15, 2022 (the "MSN 067 Closing" and together with
the MSN 173 Closing, the "Sale Closing").
Under the Plan, holders of Class 3 General Unsecured Claims will
receive payment in full in Cash on or as soon as is reasonably
practicable after the later of (A) the Effective Date and (B) the
date on which such General Unsecured Claim is Allowed by a Final
Order of the Bankruptcy Court; provided, however, that no General
Unsecured Claims shall be deemed Allowed to the extent such Claims
have been resolved by the Global Settlement, the Asset Purchase
Agreements, the Sale Order, or any other Sale and Settlement
Transaction Documents. Creditors will recover 100% of their claims.
Class 3 is unimpaired.
The Combined Hearing is scheduled for 10:00 a.m. (prevailing
Eastern Time) on August 4, 2022. Any objections to confirmation of
the Plan must be filed and served by no later than 4:00 p.m.
(Eastern Time) on July 28, 2022.
Attorneys for the Debtors:
Kyle J. Ortiz, Esq.
Bryan M. Kotliar, Esq.
John C. Gallego, Esq.
TOGUT, SEGAL & SEGAL LLP
One Penn Plaza, Suite 3335
New York, NY 10119
Tel: (212) 594-5000
A copy of the Disclosure Statement dated June 29, 2022, is
available at https://bit.ly/3uhiTDt from PacerMonitor.com.
About JPA No. 111 and JPA No. 49
Tokyo-based JPA No. 111 Co., Ltd., and its subsidiary JPA No. 49
Co., Ltd., filed a Chapter 11 Petition (Bankr. S.D.N.Y., Case No.
21-12075) on December 17, 2021. The Debtors are special purpose
vehicles wholly owned by JP Lease Products & Services Co. Ltd.,
which offers financial services based on a financial scheme
combining the borrowings from financial institutions and funds to
manage valuable assets including aircraft, ships, containers for
maritime transportation, and solar power generation equipment,
which is a direct wholly-owned subsidiary of JIA. JIA, in turn,
creates and sells unique financial instruments to investors that
consist of small and medium enterprises in Japan through a network
of financial institutions, including banks and securities
companies, and tax and accounting firms.
The Debtors had estimated liabilities of $100 million to $500
million.
The case is assigned to Honorable David S. Jones.
The Debtor's counsel is Kyle J. Ortiz, Esq., Bryan M. Kotliar,
Esq., Amy M. Oden, Esq., and Amanda C. Glaubach, Esq., at Togut,
Segal & Segal LLP, in New York. The petition was signed by Teiji
Ishikawa, representative director.
===============
M A L A Y S I A
===============
1MDB: Court Sets Aug 4 for Decision on bid to Get Docs from Aziz
----------------------------------------------------------------
theedgemarkets.com reports that the High Court has set Aug. 4 to
deliver its decision on 1Malaysia Development Bhd (1MDB) and its
three subsidiaries' bid to obtain certain documents for their
US$248 million suit against Hollywood producer Riza Aziz and his
two companies - Red Granite Pictures Inc (California) and Red
Granite Capital Ltd (BVI).
Speaking to reporters after the proceedings in chambers on July 14,
Riza's counsel Datuk Hariharan Tara Singh said that High Court
Judge Datuk Amarjeet Singh Serjit Singh will deliver his decision
via email, theedgemarkets.com relates.
The plaintiffs, namely 1MDB, 1MDB Energy Holdings Ltd, 1MDB Energy
Ltd and 1MDB Energy (Langat) Ltd, were represented by Rabindra S
Nathan.
In summary, 1MDB and its subsidiaries hope the discovery
application will give them "the full opportunity" to establish
their claims against the defendants, the report says.
Previously theedgemarkets.com reported that according to an
affidavit in support of the application, 1MDB director Mohd
Hisyamuddin Awang Abu Bakar said that without the requested
documents, 1MDB and its subsidiaries' ability to present their
arguments would be severely prejudiced.
In addition to saving the court's as well as the parties' time, he
added that the discovery of the documents was necessary for the
fair disposal of the matter, theedgemarkets.com relays.
theedgemarkets.com relates that the discovery application - filed
in January this year by Messrs Shearn Delamore & Co - refers to a
request for parties in a legal action to disclose each other's
documents which are deemed to be linked to a subject matter in a
case.
According to theedgemarkets.com, the documents sought included
Riza's correspondence with fugitive businessman Low Taek Jho, or
Jho Low, from 2009 to 2015, all documents concerning the receipt of
US$10.173 million by Red Granite Pictures between April 12, 2011
and Sept. 10, 2012.
They also sought all documents in relation to Red Granite's receipt
of US$238 million between June 18, 2012 and Nov. 14, 2012.
In addition, they are seeking the purported loan agreements Red
Granite had with Aabar BVI as well as International Petroleum
Investment Corp (IPIC), as well as documents relating to movie
posters and memorabilia, and the purchases of real estate such as
the Hillcrest property in Beverly Hills, California, the Park
Laurel condo in New York, and Qentas townhouse in London, the
report says.
The purchases of the properties were done between July 2, 2012 and
Sept. 28, 2012.
In his affidavit in reply, Riza contended that it was a fishing
expedition which among others amounted to an abuse of process.
In May 2021, 1MDB and its subsidiaries filed a US$248 million suit
against Riza along with Red Granite Pictures and Red Granite
Capital, claiming that Riza received misappropriated funds from Jho
Low or was willful and reckless in failing to make relevant
inquiries as to the sources of the funds, theedgemarkets.com
discloses.
In its statement of claim, it said that the first tranche of
payment of more than US$10 million made to Riza was from Good Star
Ltd, a company controlled by Jho Low.
It also claimed that the additional US$238 million that Red Granite
Capital received was actually from bonds raised by 1MDB for the
purchases of several power plants.
Riza in his defence claimed that the US$10 million was borrowed
from the Saudi royal family while the US$238 million was borrowed
from IPIC. He maintained the monies were not sourced from 1MDB or
its subsidiaries.
He also claimed to have paid US$10 million back to the Saudi royal
family, theedgemarkets.com adds.
About 1MDB
Kuala Lumpur-based 1Malaysia Development Bhd (1MDB) is an insolvent
Malaysian strategic development company, wholly owned by the
Malaysian Minister of Finance. 1MDB was established in 2009 to
foster long-term economic development for the country by forging
global partnerships, particularly in energy, real estate, tourism,
and agribusiness.
The Company was founded shortly after Dato Sri Najib Razak became
Prime Minister of Malaysia in July 2009. Najib said the
establishment of 1MDB into a federal entity was to benefit a
majority of Malaysians.
1MDB is said to have raised billions of dollars in bonds, for
investment projects and joint ventures, between 2009 and 2013.
Among those projects are the Tun Razak Exchange, Tun Razak
Exchange's sister project Bandar Malaysia, and the acquisition of
three independent power producers.
The Company came into heavy scrutiny in 2015 for suspicious money
transactions and evidence pointing to money laundering, fraud and
theft. The corruption scandal in 1MDB has implicated high-level
officials, including Prime Minister Najib Razak, as wells as banks
and financial institutions around the world.
In 2016, the U.S. Department of Justice filed a lawsuit, alleging
that at least US$3.5 billion has been stolen from 1MDB. In
September 2020, the alleged amount stolen had been raised to US$4.5
billion and a Malaysian government report listed 1MDB's outstanding
debts to be US$7.8 billion.
Malaysia has been filing lawsuits over the years in an effort to
recover the missing billions of dollars. Among others, in May
2021, Malaysia filed 22 civil suits against entities and people
involved in the corruption scandal, including units of Deutsche
Bank and JP Morgan.
Malaysia said in September 2020 it has so far recovered about
US$3.24 billion in assets linked to the 1MDB matter. This amount
includes about US$600 million cash and assets returned by U.S.
authorities; about US$2.5 billion paid by Goldman Sachs as
settlement; as well as US$780 million in settlement amounts from
Malaysian banking group AmBank and audit firm Deloitte.
=====================
N E W Z E A L A N D
=====================
FITLINK NEW ZEALAND: Creditors' Proofs of Debt Due on Aug. 4
------------------------------------------------------------
Creditors of Fitlink New Zealand Limited are required to file their
proofs of debt by Aug. 4, 2022, to be included in the company's
dividend distribution.
The company commenced wind-up proceedings on July 7, 2022.
The company's liquidators are:
Steven Khov
Kieran Jones
Khov Jones Limited
PO Box 302261
North Harbour
Auckland 0751
LAMBERT'S LUSCIOUS: Court to Hear Wind-Up Petition on July 26
-------------------------------------------------------------
A petition to wind up the operations of Lambert's Luscious Limited
will be heard before the High Court of New Zealand at Wellington on
July 26, 2022, at 10:00 a.m.
The Commissioner of Inland Revenue filed the petition against the
company on May 30, 2022.
The Petitioner's solicitor is:
Julia Marie Snelson
Legal Services
11 Jepsen Grove
Wallaceville
Upper Hutt 5018
PORANA ROOFING: Court to Hear Wind-Up Petition on July 26
---------------------------------------------------------
A petition to wind up the operations of Porana Roofing Limited will
be heard before the High Court of New Zealand at Wellington on July
26, 2022, at 10:00 a.m.
The Commissioner of Inland Revenue filed the petition against the
company on May 24, 2022.
The Petitioner's solicitor is:
Tara Nicola Carr
Legal Services
11 Jepsen Grove
Wallaceville
Upper Hutt 5018
SAVCON 2016: Court to Hear Wind-Up Petition on July 26
------------------------------------------------------
A petition to wind up the operations of Savcon 2016 Limited will be
heard before the High Court of New Zealand at Wellington on July
26, 2022, at 10:00 a.m.
The Commissioner of Inland Revenue filed the petition against the
company on May 12, 2022.
The Petitioner's solicitor is:
Emily Rebecca Erin O'Sullivan
Legal Services, 11 Jepsen Grove
Wallaceville
Upper Hutt 5018
TTIGR LIMITED: Court to Hear Wind-Up Petition on July 26
--------------------------------------------------------
A petition to wind up the operations of Ttigr Limited will be heard
before the High Court of New Zealand at Wellington on July 26,
2022, at 10:00 a.m.
The Commissioner of Inland Revenue filed the petition against the
company on May 9, 2022.
The Petitioner's solicitor is:
Tara Nicola Carr
Legal Services, 11 Jepsen Grove
Wallaceville
Upper Hutt 5018
=====================
P H I L I P P I N E S
=====================
BANCO RURAL DE GENERAL: Creditors' Claims Deadline Set for Aug. 22
------------------------------------------------------------------
All creditors of the closed Banco Rural de General Tinio (BRGT),
Inc. have until Aug. 22, 2022 to file their claims against the
assets of the closed bank either by e-mail, mail, or personal
filing.
Creditors refer to any individual or entity with a valid claim
against the assets of the closed Banco Rural de General Tinio
(BRGT), Inc. and include depositors whose deposits exceed the
maximum deposit insurance coverage (MDIC) of PHP500,000. The
Philippine Deposit Insurance Corporation (PDIC) said that creditors
may file their claims through any of the following:
1. Online through e-mail at tinio-pad@pdic.gov.ph;
2. Through mail addressed to the PDIC Public Assistance
Department, Ground Floor, PDIC Chino Bldg., 2228 Chino Roces
Avenue, Makati City 1231. Claims filed by mail must have a postmark
date no later than Aug. 22, 2022; or
3. Personal filing at the PDIC Public Assistance Center located at
the 3rd Floor, SSS Bldg., 6782 Ayala Avenue corner V.A. Rufino St.,
Makati City, Monday to Friday, 8:00 AM to 5:00 PM. For visits to
the PAC, clients are highly encouraged to request for an
appointment, observe health protocols and present their vaccination
cards. Appointments may be requested through the Public Assistance
Hotline at (02) 8841-4141 or at Toll Free number 1-800-1-888-7342
or 1-800-1-888-PDIC, by sending an e-mail request to
tinio-pad@pdic.gov.ph, or by sending a request through private
message at PDIC's official Facebook page at
www.facebook.com/OfficialPDIC.
The prescribed Claim Form against the assets of the closed bank may
be downloaded from the PDIC website at
http://www.pdic.gov.ph/files/Claim_Form_Against_Assets_of_Closed_Banks.pdf.
PDIC reminds creditors to transact only with authorized PDIC
personnel.
Claims filed after Aug. 22, 2022 shall be disallowed. PDIC, as
Receiver, shall notify creditors of denial of claims through mail.
Claims denied or disallowed by the PDIC may be filed with the
liquidation court within 60 days from receipt of final notice of
denial of claim or within 20 days from date of publication of the
Order setting the Petition for Assistance in the Liquidation
Proceeding for initial hearing, whichever is later.
In addition, PDIC said that depositors with account balances of
more than the MDIC of PHP500,000 who have already filed claims for
the insured portion of their deposits as of Aug. 22, 2022 are
deemed to have filed their claims for the uninsured portion or the
amount in excess of the MDIC.
PDIC, as Receiver of closed banks, requires personal data from
creditors to be able to process their claims and protects these
data in compliance with the Data Privacy Act of 2012.
Banco Rural de General Tinio (BRGT), Inc. was ordered closed by the
Monetary Board (MB) of the Bangko Sentral ng Pilipinas on June 9,
2022 and PDIC, as the designated Receiver, was directed by the MB
to proceed with the takeover and liquidation of the closed bank in
accordance with Section 12(a) of Republic Act No. 3591, as amended.
It is a single-unit rural bank located in Brgy. Poblacion Central,
General Tinio (Papaya), Nueva Ecija.
All requests and inquiries relating to Banco Rural de General Tinio
(BRGT), Inc. shall be addressed to the PDIC Public Assistance
Department through e-mail at tinio-pad@pdic.gov.ph, or through
telephone number (02) 8841-4141.
Creditors outside Metro Manila may call the PDIC Toll Free Hotline
during office hours at 1-800-1-888-PDIC (7342). Inquiries may also
be sent as private message to the PDIC's official Facebook page at
www.facebook.com/OfficialPDIC.
=================
S I N G A P O R E
=================
BMF BUSINESS: Court Enters Wind-Up Order
----------------------------------------
The High Court of Singapore entered an order on July 8, 2022, to
wind up the operations of BMF Business Group Pte. Ltd.
Maybank Singapore Limited filed the petition against the company.
The company's liquidators are:
Lin Yueh Hung
Goh Wee Teck
RSM Corporate Advisory
8 Wilkie Road, #03-08
Wilkie Edge
Singapore 228095
NEM.IO FOUNDATION: Creditors' Proofs of Debt Due on Aug. 13
-----------------------------------------------------------
Creditors of Nem.Io Foundation Limited are required to file their
proofs of debt by Aug. 13, 2022, to be included in the company's
dividend distribution.
The company commenced wind-up proceedings on July 6, 2022.
The company's liquidators are:
Lo Wei Min @Mrs Pearlyn Chong
Chan Tuck Chee
Lo Hock Ling & Co.
101A Upper Cross Street
#11-22 People's Park Centre
Singapore 058358
=================
S R I L A N K A
=================
SRI LANKA: Rajapaksa Has Yet to Resign, Whereabouts Unknown
-----------------------------------------------------------
Bloomberg News reports that Sri Lanka President Gotabaya Rajapaksa
missed a deadline announced by the Parliament Speaker to submit his
resignation after he fled the country for Maldives as months of
inflation-fueled protests gained momentum.
According to Bloomberg, reports indicate that Rajapaksa is leaving
the Maldives for another country, possibly Singapore. His
whereabouts remain unknown and he hasn't been in touch with the
Parliament Speaker Mahinda Yapa Abeywardena.
Bloomberg says the developments have left a power vacuum in
Rajapaksa's wake as demonstrators continued to push for new
leadership and have stormed and occupied the president and prime
minister's offices and residences.
They are now up against Prime Minister Ranil Wickremesinghe, who
was made acting president and earlier imposed as state of emergency
from July 13, the report says. Wickremesinghe said he formed a
committee including the police and military chiefs to de-escalate
the situation, while reiterating that parliament will choose a new
president on July 20.
Let alone receiving the official presidential resignation letter by
a promised July 13 deadline, Sri Lanka's speaker hasn't had any
communication with Rajapaksa since earlier on July 13, according to
his media secretary. Mahinda Yapa Abeywardena will make an
announcement once he receives an update from Rajapaksa, he said.
According to Bloomberg, the legislature's proposed July 15 special
meeting, meant to start the process of electing a new president,
now hangs in balance because Rajapaksa didn't resign on July 13.
Even if the president did send in his resignation on July 14, it's
uncertain whether the required paperwork can be done in time for
parliament to meet on July 15, according to Janakantha Silva, the
legislature's director of communication. The next scheduled session
is July 19, he said.
As recently reported in the Troubled Company Reporter-Asia
Pacific,
S&P Global Ratings, on May 27, 2022, affirmed its long-term and
short-term foreign currency sovereign ratings on Sri Lanka at
'SD/SD.' At the same time, S&P affirmed its 'CCC-' long-term and
'C' short-term local currency sovereign ratings. The outlook on
the
local currency ratings remains negative.
In addition, S&P lowered to 'D' from 'CC' the issue ratings on the
following bonds with missed interest payments in May:
-- US$1.5 billion, 6.85% bonds due Nov. 3, 2025.
-- US$1.5 billion, 6.20% bonds due May 11, 2027.
S&P's transfer and convertibility assessment at 'CC' is unchanged.
*********
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 2022. All rights reserved. ISSN: 1520-9482.
This material is copyrighted and any commercial use, resale or
publication in any form (including e-mail forwarding,
electronic re-mailing and photocopying) is strictly prohibited
without prior written permission of the publishers.
Information contained herein is obtained from sources believed
to be reliable, but is not guaranteed.
TCR-AP subscription rate is US$775 for 6 months delivered via e-
mail. Additional e-mail subscriptions for members of the same
firm for the term of the initial subscription or balance
thereof are US$25 each. For subscription information, contact
Peter Chapman at 215-945-7000.
*** End of Transmission ***