/raid1/www/Hosts/bankrupt/TCRAP_Public/220822.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
A S I A P A C I F I C
Monday, August 22, 2022, Vol. 25, No. 161
Headlines
A U S T R A L I A
EFP EMPLOYMENT: Second Creditors' Meeting Set for Aug. 25
GGPG DEVELOPMENTS: First Creditors' Meeting Set for Aug. 25
LIBERTY SERIES 2020-4: Moody's Ups Rating on Class F Notes to Ba1
METRO GLOBAL: Second Creditors' Meeting Set for Aug. 24
MOULAMEIN GRAIN: First Creditors' Meeting Set for Aug. 25
SIMPLEMOTION PTY: Second Creditors' Meeting Set for Aug. 25
C H I N A
CENTRAL CHINA REAL: Fitch Affirms 'B' LongTerm Foreign Currency IDR
DEER INVESTMENT: Moody's Assigns First Time B2 Corp. Family Rating
KUNMING INDUSTRIAL: Fitch Cuts LongTerm IDRs to BB, Outlook Stable
KWG GROUP: Fitch Withdraws 'CCC+' Foreign Currency IDR
TIMES CHINA: Fitch Raises Foreign Currency IDR to 'CC'
TOMORROW HOLDINGS: Xiao Jianhua to 13 Years for Financial Crimes
H O N G K O N G
CATHAY PACIFIC: Net Loss Narrows to US$637MM in H1 Ended June 30
HONG YANG: Fitch Corrects July 29 Ratings Release
I N D I A
AASTHA COLD: CARE Keeps D Debt Rating in Not Cooperating
ADHUNIK POWER: CARE Keeps D Debt Rating in Not Cooperating
AG8 VENTURES: Insolvency Resolution Process Case Summary
AMEREX PRIVATE: Insolvency Resolution Process Case Summary
ANAND ELECTRICALS: CRISIL Keeps D Debt Ratings in Not Cooperating
ANGEL PROMOTERS: CRISIL Keeps C Debt Rating in Not Cooperating
ANLON HEALTHCARE: CARE Keeps D Debt Ratings in Not Cooperating
BENCO THERMAL: CRISIL Withdraws B+ Rating on INR4cr Cash Loan
BHAVANI RICE: CARE Keeps D Debt Rating in Not Cooperating
BHAVI CREATIONS: CRISIL Keeps D Debt Rating in Not Cooperating
CHITTARANJAN MULTI: CRISIL Keeps D Ratings in Not Cooperating
CP ARORA: Ind-Ra Assigns BB+ LT Issuer Rating, Outlook Stable
DANIA ORO: CRISIL Keeps D Debt Ratings in Not Cooperating
DYNAMIX CHAINS: CRISIL Keeps D Debt Ratings in Not Cooperating
FENIX PROCESS: CRISIL Keeps D Debt Ratings in Not Cooperating
FUTURE ENTERPRISES: Creditor Files Insolvency Bid in NCLT
HANSRAJ MEMORIAL: CARE Keeps D Debt Ratings in Not Cooperating
HINDUSTAN TANKERS: Insolvency Resolution Process Case Summary
JUBILANT PHARMA: S&P Lowers LT ICR to 'BB-' Then Withdraws Rating
KOMAL KAKADE: Insolvency Resolution Process Case Summary
KRISH AGRO: CRISIL Reaffirms B+ Rating on INR12cr Cash Loan
LAKSHMI RANGA: CRISIL Keeps D Debt Ratings in Not Cooperating
MAA KALIKA: CRISIL Keeps D Debt Ratings in Not Cooperating
MAHIP INDUSTRIES: Ind-Ra Cuts Long-Term Issuer Rating to 'D'
MEDICON LEATHER: CRISIL Reaffirms D Rating on INR5cr Cash Loan
MEGI AGRO CHEM: Insolvency Resolution Process Case Summary
MICRO DYNAMICS: Insolvency Resolution Process Case Summary
NATHJI COTTON: CARE Keeps D Debt Rating in Not Cooperating
NCL BUILDTEK: Ind-Ra Withdraws 'BB+' Term Loan Rating
NEUEON TOWERS: CARE Keeps D Debt Ratings in Not Cooperating
NITYA REALTECH: Insolvency Resolution Process Case Summary
NIZAM DECCAN: CRISIL Keeps D Debt Ratings in Not Cooperating
PODDAR CAR: Ind-Ra Moves BB+ Issuer Rating to Non-Cooperating
PRIME INFRAPARK: Insolvency Resolution Process Case Summary
PROVIEW INFRASTRUCTURE: Insolvency Resolution Process Case Summary
RICH FRUITS: Liquidation Process Case Summary
SATHWIK EXPORTS: CARE Keeps C Debt Rating in Not Cooperating
SHAH HOUSECON: Insolvency Resolution Process Case Summary
SNAP FINSERV: Voluntary Liquidation Process Case Summary
SNH CONSTRUCTION: Insolvency Resolution Process Case Summary
SNS LABORATORIES: Insolvency Resolution Process Case Summary
SPLENDID METAL: CARE Keeps D Debt Ratings in Not Cooperating
TERRA REALCON: CRISIL Keeps D Debt Rating in Not Cooperating
TOPWORTH URJA: Insolvency Resolution Process Case Summary
TOPWORTH URJA: NCLT Admits Firm Under Insolvency Process
TRIMURTI CORNS: CRISIL Keeps D Debt Ratings in Not Cooperating
VARDHMAN ROLLER: CARE Lowers Rating on INR31.90cr LT Loan to C
VASAVI AGRO: CRISIL Keeps D Debt Ratings in Not Cooperating
VEL TECH: Ind-Ra Assigns BB+ Bank Loan Rating
YANTRA GREEN: CRISIL Keeps D Debt Rating in Not Cooperating
I N D O N E S I A
AGUNG PODOMORO: Fitch Affirms 'CCC' LongTerm IDR
J A P A N
AEON CO: Egan-Jones Retains BB Senior Unsecured Ratings
N E W Z E A L A N D
DELTA CIVIL: Court to Hear Wind-Up Petition on Sept. 2
EXUBERANT LIMITED: Court to Hear Wind-Up Petition on Sept. 6
FASHION FOCUS: To Shut Up Shop on End of September
FRIENDLY BEANS: Creditors' Proofs of Debt Due on Sept. 15
WILSON AND GILLGREN: BDO Tauranga Appointed as Liquidators
ZAC CONSTRUCTION: Court to Hear Wind-Up Petition on Sept. 9
S I N G A P O R E
CHONG SING: Court Enters Wind-Up Order
HANNA'S FUSION: Court Enters Wind-Up Order
SIGNATURE BRIDAL: Court Enters Wind-Up Order
SOI GLOBAL: Court to Hear Wind-Up Petition on Sept. 2
SUNMAX GLOBAL: Court Enters Wind-Up Order
S R I L A N K A
SRI LANKA: Hopes to Reach Initial Agreement with IMF for Help
T H A I L A N D
KTBST SECURITIES: Fitch Gives 'BB(tha)' Rating on Sub. Debentures
V I E T N A M
MONG DUONG FINANCE: Fitch Affirms BB on USD679MM Notes Due 2029
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A U S T R A L I A
=================
EFP EMPLOYMENT: Second Creditors' Meeting Set for Aug. 25
---------------------------------------------------------
A second meeting of creditors in the proceedings of EFP Employment
Services Pty Limited has been set for Aug. 25, 2022, at 10:00 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 Aug. 24, 2022, at 4:00 p.m.
Geoffrey Trent Hancock of Hamilton Murphy Advisory was appointed as
administrator of the company on July 21, 2022.
GGPG DEVELOPMENTS: First Creditors' Meeting Set for Aug. 25
-----------------------------------------------------------
A first meeting of the creditors in the proceedings of GGPG
Developments (No.8) Pty Ltd will be held on Aug. 25, 2022, at 10:00
a.m. at the offices of BRI Ferrier at Level 4, 307 Queen Street in
Brisbane.
James Taplin and Stefan Dopking of BRI Ferrier were appointed as
administrators of the company on Aug. 16, 2022.
LIBERTY SERIES 2020-4: Moody's Ups Rating on Class F Notes to Ba1
-----------------------------------------------------------------
Moody's Investors Service has upgraded the ratings on six classes
of notes issued by two Liberty Series residential mortgage-backed
securities (RMBS) transactions.
The affected ratings are as follows:
Issuer: Liberty Series 2020-4
Class C Notes, Upgraded to Aa3 (sf); previously on Oct 20, 2021
Upgraded to A1 (sf)
Class D Notes, Upgraded to A2 (sf); previously on Oct 20, 2021
Upgraded to Baa1 (sf)
Class E Notes, Upgraded to Baa2 (sf); previously on Oct 20, 2021
Upgraded to Ba1 (sf)
Class F Notes, Upgraded to Ba1 (sf); previously on Oct 20, 2021
Upgraded to Ba3 (sf)
Issuer: Liberty Series 2021-1
Class B Notes, Upgraded to Aa1 (sf); previously on Mar 31, 2021
Definitive Rating Assigned Aa2 (sf)
Class C Notes, Upgraded to A1 (sf); previously on Mar 31, 2021
Definitive Rating Assigned A2 (sf)
RATINGS RATIONALE
The upgrades were prompted by better-than-expected collateral
performance to date, with a moderate level of loans in arrears and
no losses to date. Another positive factor is the shortening of the
remaining substitution period which progressively reduces the
limited risk posed by the substitutions.
Both deals are currently within their two-year substitution period,
whereby additional loans can be sold into the portfolio on a
monthly basis, subject to substitution loan parameters and
portfolio performance triggers being met. As such, there has been
no principal repayments or increase in note subordination since
closing.
Liberty Series 2020-4
As of June 2022, 0.5% of the outstanding pool was 30-plus day
delinquent, and 0.1% was 90-plus day delinquent. The deal has
incurred no losses to date.
Based on the observed performance to date and loan attributes,
Moody's has maintained its expected loss assumption at 1.2% of the
original note balance, same level as at last rating action.
Based on the current portfolio characteristics and incorporating
the potential characteristics of the new loans to be added during
the remaining shorter substitution period, Moody's has lowered its
MILAN CE assumption to 7.3% from 8.1% at last rating action.
Liberty Series 2021-1
As of June 2022, 1.4% of the outstanding pool was 30-plus day
delinquent, and 0.7% was 90-plus day delinquent. The deal has
incurred no losses to date.
Based on the observed performance to date and loan attributes,
Moody's has maintained its expected loss assumption at 1.2% of the
original note balance, same level as at last rating action.
Based on the current portfolio characteristics and incorporating
the potential characteristics of the new loans to be added during
the remaining shorter substitution period, Moody's has lowered its
MILAN CE assumption to 6.9% from 7.3% at last rating action.
The transactions are Australian RMBS originated and serviced by
Liberty Financial Pty Ltd, an Australian non-bank lender. A small
portion of the portfolios consists of loans extended to borrowers
with impaired credit histories or loans made on a limited
documentation basis.
The principal methodology used in these ratings was "Moody's
Approach to Rating RMBS Using the MILAN Framework" published in
July 2022.
Factors that would lead to an upgrade or downgrade of the ratings:
Factors that could lead to an upgrade of the ratings include: (1)
performance of the underlying collateral that is better than
Moody's expectations, and (2) an increase in credit enhancement
available for the notes.
Factors that could lead to a downgrade of the ratings include: (1)
performance of the underlying collateral that is worse than Moody's
expectations, (2) a decrease in credit enhancement available for
the notes, and (3) a deterioration in the credit quality of the
transaction counterparties.
METRO GLOBAL: Second Creditors' Meeting Set for Aug. 24
-------------------------------------------------------
A second meeting of creditors in the proceedings of Metro Global
Technology Supplies Pty Ltd has been set for Aug. 24, 2022, at
10:00 a.m. via virtual facility only.
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 Aug. 23, 2022, at 4:00 p.m.
David Coyne of BRI Ferrier was appointed as administrator of the
company on July 20, 2022.
MOULAMEIN GRAIN: First Creditors' Meeting Set for Aug. 25
---------------------------------------------------------
A first meeting of the creditors in the proceedings of Moulamein
Grain Services Pty Ltd, trading as Northern Valley Stockfeed, will
be held on Aug. 25, 2022, at 2:00 p.m. via virtual meeting
technology.
Nathan Deppeler and Matthew Jess of Worrells were appointed as
administrators of the company on Aug. 15, 2022.
SIMPLEMOTION PTY: Second Creditors' Meeting Set for Aug. 25
-----------------------------------------------------------
A second meeting of creditors in the proceedings of SimpleMotion
Pty Ltd has been set for Aug. 25, 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 Aug. 25, 2022, at 11:00 a.m.
Adam Shepard of Setter Shepard was appointed as administrator of
the company on July 21, 2022.
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C H I N A
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CENTRAL CHINA REAL: Fitch Affirms 'B' LongTerm Foreign Currency IDR
-------------------------------------------------------------------
Fitch ratings has affirmed Central China Real Estate Limited's
(CCRE) Long-Term Foreign-Currency Issuer Default Rating (IDR) at
'B' with a Negative Outlook. Fitch has also affirmed the senior
unsecured rating and the ratings on CCRE's outstanding US-dollar
senior unsecured notes at 'B' with a Recovery Rating of 'RR4'.
Fitch has removed all ratings from Rating Watch Negative.
The affirmation and removal of the Rating Watch Negative follows
CCRE's timely repayment of its USD500 million bonds maturing on 8
August 2022.
The Negative Outlook reflects tight liquidity, weak sales and large
capital market debt that matures in 2023.
KEY RATING DRIVERS
Repayment of Bond: CCRE has repaid the USD500 million bond maturing
on August 8 mainly using internal cash and asset sale proceeds.
Fitch believes CCRE's liquidity position could remain tight
following the bond repayment, as contracted sales declined by 55%
yoy in 1H22 and will limit cash generation.
Significant Maturities in 2023: CCRE has significant offshore bonds
maturing in 2023, including the USD300 million bond maturing in
April and USD400 million bond maturing in August. CCRE may need to
obtain additional funding to repay these bonds should its weak
sales performance continue.
Share Sale Agreement: CCRE announced on July 21 that it has entered
into a sale and purchase agreement to sell a 29% stake of the
company to a wholly owned subsidiary of Henan Railway Construction.
The sale proceeds of HKD648 million will be provided to CCRE as a
shareholder loan. Fitch believes negotiation with Henan Railway
Construction on the proposed issuance of convertible bonds is
ongoing and on 1 August CCRE said that it had appointed two
non-executive directors from Henan Railway Construction to its
board.
Weak Contracted Sales: Fitch said, "We expect CCRE's full-year 2022
contracted sales to drop by 30% to around CNY42 billion, a decline
that is similar to our expectation for China's overall property
market. CCRE reported 1H22 contracted sales of CNY14 billion; the
55% drop is broadly in line with private property-development
peers. We believe a broader sales recovery in 2H22 remains
uncertain."
Leading Position in Henan: Fitch said, "We believe CCRE's
concentration in Henan may enable the company to obtain some
support from the Henan government. CCRE maintains a leading market
position in the province, with a market share of about 7% by
heavy-asset sales in 2021. It has been developing residential
properties almost entirely in Henan for nearly 30 years and had 230
projects there at end-2021."
Adequate Land Bank: CCRE's attributable land bank of around 38.6
million square metres, which the company estimates is valued at
CNY200 billion, can sustain its sales for three to four years,
taking into account that some large projects may take time to
churn.
DERIVATION SUMMARY
CCRE's ratings and the Negative Outlook reflect its weak sales and
tight liquidity.
CCRE has a weaker business profile than Radiance Group Co., Ltd.
(B+/Stable), as its total contracted sales in 1H22 amounted to
CNY14 billion, which was less than Radiance's CNY24 billion in the
same period.
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 of 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% is applied to accounts receivable. This
treatment is in line with our Recovery Rating criteria.
- Advance rate of 57% is 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 we consider as acceptable in a
secondary market transaction.
- Advance rate of 50% is applied to property, plant and
equipment, which mainly consists of buildings, the value of
which is insignificant.
- Advance rate of 62% is applied to net property inventory, which
mainly consists of completed properties held for sales,
properties under development (PUD) and prepayments for land
acquisitions. Different advance rates were applied to these
various inventory categories to derive the blended advance
rate.
- Advance rate of 70% is applied to completed properties held for
sale. Completed commodity housing units are closer to readily
marketable inventory. The company's historical gross margin for
development property is around 15% and it adopts a fast-churn
strategy. This means its book value of inventory should be
close to market value and we therefore applied a higher advance
rate than the typical 50% mentioned in the criteria.
- Advance rate of 50% is applied 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. The PUD balance - before applying the advance rate
- is net of margin-adjusted customer deposits.
- Advance rate of 90% is applied to deposits for land
acquisitions. Similarly to completed commodity housing units,
land held for development is close to readily marketable
inventory. The company is a leading developer in Henan and has
good relationship with the local government. Fitch said, "We
believe it may be able to resell the land bank to the
government, if needed. Therefore, we considered a higher
advance rate than the typical 50% mentioned in the criteria."
- Advance rate of 50% is applied to joint-venture (JV) net
assets. JV assets typically include a combination of completed
units, PUD and land bank. The advance rate is applied in line
with the baseline advance rate for inventory.
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 Outlook will be revised to Stable if the negative sensitivities
are not met. This includes a sustained improvement in contracted
sales, liquidity and capital structure, and greater clarity in the
repayment of the offshore bonds maturing in 2023.
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
- Deterioration in liquidity or funding access
- No meaning recovery in contracted sales or cash collection
LIQUIDITY AND DEBT STRUCTURE
Tight Liquidity: CCRE had unrestricted cash of CNY5.9 billion,
excluding restricted cash of CNY2.7 billion, as of end-2021, while
it had short-term debt of CNY3.8 billion. The company repaid the
USD500 million maturity due on 8 August 2022 using internal cash
and asset disposal proceeds. The company has not provided its
latest cash balance to Fitch, as it is in the process of an interim
review.
REFERENCES FOR SUBSTANTIALLY MATERIAL SOURCE CITED AS KEY DRIVER OF
RATING
The principal sources of information used in the analysis are
described in the Applicable Criteria.
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.
Rating Actons
Rating Prior
------ -----
Central China Real
Estate Limited
LT IDR B Affirmed B
senior unsecured LT B Affirmed RR4 B
DEER INVESTMENT: Moody's Assigns First Time B2 Corp. Family Rating
------------------------------------------------------------------
Moody's Investors Service has assigned a first-time B2 corporate
family rating to Deer Investment Holdings Limited.
The rating outlook is stable.
The rating is dependent on the satisfactory documentation and
successful completion of the acquisition financing for Carlyle's
acquisition of HCP Global Limited. A failure to meet such
conditions could pressure the rating.
Moody's assessed Deer's financial performance when considering
HCP's financial profile because HCP will be Deer's only operating
subsidiary upon the completion of the acquisition.
RATINGS RATIONALE
"The B2 CFR reflects HCP's long operating track record, strong
market position, very good liquidity and good profitability," says
Shawn Xiong, a Moody's Vice President and Senior Analyst.
"On the other hand, the rating is constrained by HCP's small
revenue scale and exposure to cyclical end markets, high financial
leverage and ownership by a private equity firm," adds Xiong.
Founded in 1960, HCP has over 60 years of operating history in the
cosmetic and skincare product packaging manufacturing industry. The
company is a market leader in the rigid plastic packaging sector.
On the other hand, the company's absolute revenue scale is small
and it operates in a highly competitive and fragmented market. Its
products focus on and are limited to premium packaging for cosmetic
and skincare products, which are discretionary purchases by
consumers.
The company has on average over 20 years of business relationship
with cosmetic market leaders, including Estee Lauder Companies Inc.
(The) (A1 stable) and L'Oreal S.A. (Aa1 stable). For 2021, HCP
generated around 40% of its total revenues from these two
companies. These longstanding business relationships provide a
degree of revenue visibility over the next two years.
Moody's expects HCP will benefit from the strong recovery in the
cosmetic and skincare industry, underpinned by consumers' return to
offices with normalized routines. Moody's also expects this
recovery to benefit large incumbents in the cosmetic and skincare
sector, and for consumers to continue to trade up for premium
products.
Notwithstanding the above, Moody's expects HCP's revenue recovery
to slow to 5%-6% growth in 2022 due to the pandemic-related
disruptions in China (A1 stable), particularly during the first
four months of the year. The company's revenue growth should be
much stronger at 15%-20% for 2023, driven by organic revenue growth
and synergistic benefits with Tokiwa, a Carlyle-owned cosmetic and
skincare original equipment manufacturer based in Japan.
HCP has exhibited strong adjusted EBITDA margins in the range of
24%-25%, historically supported by its focus on premium products
and significant manufacturing capacities in China, where costs are
comparatively lower. Due to pandemic-related disruptions and
product mix changes, the company's adjusted EBITDA margin declined
significantly to around 16.5% for 2021. Moody's expects HCP's
sales to higher-margined North American and European markets to
increase proportionally and pandemic-related disruptions to
gradually subside over the next 12-18 months, which should help the
company's margin recovery.
Additionally, despite the fact that most of its customer contracts
are fixed price, HCP has demonstrated an ability to negotiate with
its large customers to pass through some of its significant cost
increases. This should temper the negative impact of rising raw
material, labor and freight costs. Consequently, Moody's expects
HCP's adjusted EBITDA margin to recover to 18.5%-21.0% over the
next 12-18 months.
As a result, Moody's expects HCP's financial leverage, as measured
by adjusted debt/EBITDA, to improve toward 7.5x-8.0x in 2022 and
5.5x-6.0x in 2023, from 11.7x in 2021. The starting leverage level
is weak for the B2 CFR, although this is mitigated by HCP's very
good liquidity and expected positive free cash flow over the next
12-18 months.
Deer's ratings also consider the company's private company status,
which result in low corporate transparency. In addition, Moody's
has considered event risks related to material merger and
acquisitions and financing activities, given its full ownership by
a private equity firm.
HCP's liquidity will be very good upon completion of the
acquisition financing. Its liquidity is supported by an expected
$35 million opening cash balance, a $75 million undrawn revolving
credit facility, and an expected largely positive free cash flow
generation over the next 12-18 months. Meanwhile, the company will
not have any material debt maturity until 2029.
ENVIRONMENTAL, SOCIAL, GOVERNANCE (ESG) CONSIDERATIONS
As a manufacturer of packaging products made of plastic and metal
for the cosmetic and skincare industry, HCP is exposed to
environmental and social risks stemming from an increasing focus on
sustainable packaging among consumers, customers and regulators.
These trends could result in not only lower volumes but also
incremental costs, which will weigh on the company's profitability
and cash flow. According to the company, around 35% of its products
are made using recycled materials.
With regard to governance risks, HCP is controlled by private
equity firm, the Carlyle, which like other financial sponsors has
tolerance for relatively high leverage in the companies it
controls.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
The stable outlook reflects Moody's expectation that HCP's
operating performance will recover, supported by strong demand
growth; and that its financial leverage will improve to a level
consistent with the B2 rating over the next two years, while
maintaining good liquidity. The outlook also assumes that the
company will not embark on any material debt funded acquisitions or
shareholder distributions.
Upward pressure on the ratings could develop if HCP's adjusted
debt/EBITDA improves to 4.5x on a sustained basis, and if it
maintains positive free cash flow generation and a good liquidity
profile.
Conversely, negative pressure on the rating could develop if the
company's operating performance materially deteriorates or it
embarks on large debt-funded acquisitions or shareholder
distributions, such that its Moody's-adjusted leverage fails to
improve toward 6.0x and its free cash flow remains negative for a
prolonged period. Downward pressure on the rating could also arise
if the company's liquidity deteriorates.
The principal methodology used in these ratings was Packaging
Manufacturers: Metal, Glass and Plastic Containers published in
December 2021.
Founded in 1960, HCP currently has 10 manufacturing plants and 11
sales office across China, Europe and America. Upon completion of
the acquisition, Carlyle will own a 100% stake in HCP through its
various intermediate holding companies, including Deer.
KUNMING INDUSTRIAL: Fitch Cuts LongTerm IDRs to BB, Outlook Stable
------------------------------------------------------------------
Fitch Ratings has downgraded the Long-Term Foreign- and
Local-Currency Issuer Default Ratings (IDRs) on Kunming Industrial
Development & Investment Co. Ltd. (KIDI) to 'BB' from 'BB+'. The
Outlook is Stable.
KEY RATING DRIVERS
The downgrade follows Fitch's revision of its perception of Kunming
municipality's ability to provide subsidies, grants and other
legitimate resources allowed under China's policies and
regulations, owing to slowing economic growth, weaker capital
revenue performance and increasing debt.
KIDI's linkage with the municipal government is based on the
municipality's close to full ownership and direct control of the
group, a 'Strong' record of government support, 'Moderate'
socio-political and 'Strong' financial implications should KIDI
default. These factors result in a high likelihood of extraordinary
government support for KIDI, if needed.
DERIVATION SUMMARY
KIDI's ratings are assessed under Fitch's Government-Related
Entities Rating Criteria, reflecting the entity's control and
ownership by Kunming municipality, the government's support record
as well as the socio-political and financial impact on the
government from a default by KIDI.
Fitch assessment of KIDI's Standalone Credit Profile is based on
our Public Sector, Revenue-Supported Entities Rating Criteria.
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
- An upward revision in Fitch's credit view of Kunming
municipality's ability to provide subsidies, grants or other
legitimate resources allowed under China's policies and
regulations would lead to a positive change in KIDI's ratings.
- An increase in the incentive for Kunming municipality to
provide support to KIDI, including stronger socio-political or
financial implications of default or a stronger support record
may trigger positive rating action.
- An improvement in KIDI's Standalone Credit Profile.
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
- A lowering of Fitch's credit view of Kunming municipality's
ability to provide subsidies, grants or other legitimate
resources allowed under China's policies and regulations would
lead to a negative change in KIDI's ratings.
- Weaker assessment of the socio-political and financial
implications of default, a weaker support record or a dilution
in the government's shareholding may trigger negative rating
action.
ISSUER PROFILE
KIDI was established in 2005 and is majority owned by the
government of Kunming, the capital of China's Yunnan province. The
company is tasked with promoting domestic industry investment and
development and is mainly engaged in primary land and industrial
park development, industrial and financial investment, commodity
trading and civil-use explosives production.
Rating Prior
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Kunming Industrial
Development &
Investment Co. Ltd. LT IDR BB Downgrade BB+
LC LT IDR BB Downgrade BB+
KWG GROUP: Fitch Withdraws 'CCC+' Foreign Currency IDR
------------------------------------------------------
Fitch Ratings has withdrawn Chinese homebuilder KWG Group Holdings
Limited's Long-Term Foreign-Currency Issuer Default Rating (IDR) of
'CCC+' and senior unsecured rating of 'CCC+', with recovery rating
at RR4.
Fitch is withdrawing the ratings as KWG has chosen to stop
participating in the rating process. Therefore, Fitch will no
longer have sufficient information to maintain the ratings.
Accordingly, Fitch will no longer provide ratings or analytical
coverage for KWG.
KEY RATING DRIVERS
No longer relevant, as the ratings have been withdrawn.
RATING SENSITIVITIES
No longer relevant, as the ratings have been withdrawn.
ISSUER PROFILE
KWG is a medium-sized developer with 27 years of experience in
building residential and commercial properties. It specialises in
developing mid- to high-end residential properties, office
buildings, shopping malls and hotels in China's Greater Bay Area
and Yangtze River Delta.
ESG CONSIDERATIONS
KWG has an ESG Relevance Score of '4' for Financial Transparency
due to previously undisclosed contingent liabilities and the
delayed issuance of its 2021 audited financial reports, which has a
negative impact on the credit profile, and is relevant to the
rating in conjunction with other factors.
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.
Following the withdrawal of ratings for KWG, Fitch will no longer
be providing the associated ESG Relevance Scores.
TIMES CHINA: Fitch Raises Foreign Currency IDR to 'CC'
------------------------------------------------------
Fitch Ratings has upgraded the Long-Term Foreign-Currency Issuer
Default Rating (IDR) and senior unsecured rating of Chinese
homebuilder Times China Holdings Limited to 'CC' from 'C'. The
Recovery Rating remains at 'RR4'.
The upgrade follows Times China's repayment of interest on two
bonds before the grace periods end on August 12 and August 14.
Fitch believes the company will continue to face liquidity
challenges, with a large amount of capital-market maturities and
interest payments in 2H22 and 1H23, while its access to funding
could remain limited and sales performance may stay weak.
KEY RATING DRIVERS
Bond Interest Paid: Times China missed the interest payment due on
July 14 and July 16 on its USD350 million 5.75% bond due January
2027 and USD500 million 6.75% bond due July 2023, respectively. The
company repaid the interest on 4 and 5 August before the grace
periods end.
Heightened Refinancing Risk: Fitch expects Times China's
capital-market access to remain limited in the medium term. Fitch
believes the company will rely on sales proceeds, refunds from the
government on its urban renewal projects (URPs), and potential
disposals of stakes in projects to repay its capital-market debt
during this time.
Times China has CNY1.1 billion of onshore bonds maturing in
September. It also has CNY12.8 billion of capital-market debt
maturing in 2023, including CNY5.0 billion of offshore bonds and
CNY7.8 billion of onshore bonds that turn puttable in 2023.
Sales Decline: Contracted sales dropped by 43% yoy in 7M22, broadly
in line with the market. Sales in July fell by 65% yoy to CNY2.8
billion. Fitch believes a broader sales recovery in 2H22 remains
uncertain. Apart from property sales, Time China's primary
development business may generate some cash flow from the
conversion of land parcels for local governments. However, the
receipt of this cash flow is subject to the timing set by the local
governments.
DERIVATION SUMMARY
Times China's ratings are driven by its high level of credit risks
related to the repayment of its upcoming capital-market maturities
amid negative capital-market sentiment.
KEY ASSUMPTIONS
-- Total contracted sales of CNY55 billion-65 billion a year in
2022 and 2023;
-- Unsold land bank life maintained at two to three years, and
Times China will slow down land acquisitions to prioritise
debt repayment, if needed.
KEY RECOVERY RATING ASSUMPTIONS
-- 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 24% applied to the book value of self-owned
investment properties. The portfolio has an average rental
yield of about 1%, which is low. The implied rental yield on
the liquidation value for the investment-property portfolio
would improve to 6%, which would be considered acceptable in a
secondary market transaction.
-- Advance rate of 50% applied to property, plant and equipment,
which consists mainly of buildings, the value of which is
insignificant.
-- Advance rate of 59% applied to net property inventory. The
inventory consists mainly of completed properties held for
sale, properties under development (PUD), prepayments for
redevelopment projects, and deposits for land acquisitions.
Different advance rates were applied to these different
inventory categories to derive the blended advance rate for
net inventory.
-- Advance rate of 70% to completed properties held for sale.
Completed commodity housing units are closer to readily
marketable inventory. The historical gross margin for
development property is around 20%-25%. 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% applied to deposits for land acquisitions.
In a similar way to completed commodity housing units, land
held for development is closer to readily marketable
inventory, provided it is in satisfactory locations. The
company's land in general is not located in significantly
disadvantaged areas. Fitch applied a higher advance rate than
the typical 50% mentioned in the Criteria.
-- Advance rate of 80% applied to prepayments for URPs. Fitch
views this as similar to prepayments for land, as primary
development will typically go through a land auction again,
and the developer that conducted the primary development will
be fully compensated even if it had not secured the land in
the auction. Fitch applied 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 'RR1' for the offshore senior
notes. However, the Recovery Rating for senior unsecured debt is at
'RR4', as China falls into Group D of creditor-friendliness under
Fitch's Country-Specific Treatment of Recovery Ratings Criteria.
The Recovery Ratings for instruments by issuers with assets in this
group are subject to a cap of 'RR4'.
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
-- Greater clarify on the repayment plans for capital-market
maturities for the rest of 2022 and 1H23.
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
-- Failure to repay capital-market maturities or bond interest
falling due in 2022;
-- Any announcement of a default or default-like process.
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: Times China had available cash of CNY14.7 billion,
excluding restricted cash of CNY5.9 billion, at end-2021, covering
CNY11 billion of short-term debt. The company has not disclosed to
Fitch its latest cash balance as it is conducting an interim
review, while it has CNY1.1 billion of onshore bonds maturing in
September. It also has CNY2 billion in offshore bonds maturing in
March 2023 and CNY4.8 billion in onshore bonds puttable in 1H23.
ISSUER PROFILE
Times China, established in 1999, focuses on residential projects
in Guangdong province. Its total land bank was 19.9 million sq m at
end-2021. The company has also acquired or signed preliminary
agreements for about 160 URPs.
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.
RATING ACTIONS
ENTITY/DEBT RATING RECOVERY PRIOR
----------- ------ -------- -----
Times China LT IDR CC Upgrade C
Holdings Limited
senior unsecured LT CC Upgrade RR4 C
TOMORROW HOLDINGS: Xiao Jianhua to 13 Years for Financial Crimes
----------------------------------------------------------------
Reuters reports that a Shanghai court on Aug. 19 sentenced
Chinese-Canadian billionaire Xiao Jianhua, not seen in public since
2017, to 13 years in jail and fined his Tomorrow Holdings
conglomerate CNY55.03 billion (US$8.1 billion), a record in China.
Xiao and Tomorrow Holdings were charged with illegally siphoning
away public deposits, betraying the use of entrusted property, and
the illegal use of funds and bribery, the Shanghai First
Intermediate Court said, according to Reuters.
It added the punishment was mitigated because both had admitted
their crimes and cooperated in recovering illegal gains and in
restoring losses, Reuters relates.
China-born Xiao, known to have links to China's Communist Party
elite, was last seen whisked away in a wheelchair from a luxury
Hong Kong hotel in the early hours with his head covered, a source
close to the tycoon told Reuters at the time.
According to Reuters, Xiao and Tomorrow have "severely violated a
financial management order" and "hurt state financial security",
the court said, with the tycoon additionally fined CNY6.5 million
for the crimes.
From 2001 to 2021, Xiao and Tomorrow gave shares, real estate, cash
and other assets to government officials totalling more than 680
million yuan, to evade financial supervision and seek illegitimate
benefits, the court, as cited by Reuters, said.
In July 2020, nine of the group's related institutions were seized
by Chinese regulators as part of a crackdown on risks posed by
financial conglomerates, recalls Reuters.
Among the nine firms were four insurers - Tianan Property Insurance
Co of China, Huaxia Life Insurance Co, Tianan Life Insurance Co and
Yi'an P&C Insurance Co - as well as New Times Trust Co and New
China Trust Co. The other three were Chengtong Securities, Guosheng
Securities and Guosheng Futures, Reuters discloses.
Reuters relates that the court said that from 2004, Xiao and
Tomorrow controlled multiple financial institutions and internet
financial platforms, including the failed Baoshang Bank, via
multiple layers of indirect shareholders and anonymous ownership.
It said Xiao used the illegal gains for the acquisition of
financial institutions, securities trading and overseas investment.
But it acknowledged his attempts to make amends.
"Xiao Jianhua has taken commendable actions, so he was given a
mitigated punishment in accordance with the law," it said.
Asked about Xiao's right to consular access as a Canadian citizen
at briefing on Aug. 19, Chinese foreign ministry spokesperson Wang
Wenbin said Xiao was not entitled to such rights as Chinese law did
not recognise dual nationality, according to Reuters.
Reuters adds that Canada's foreign ministry said it was aware of
media reports about the sentencing, and its officials would monitor
the case and press for consular access.
"The lack of transparency in Mr. Xiao's legal process is very
concerning, as is the ongoing lack of consular access, which
prevents us from being able to assess his wellbeing," it said in a
statement.
=================
H O N G K O N G
=================
CATHAY PACIFIC: Net Loss Narrows to US$637MM in H1 Ended June 30
----------------------------------------------------------------
Japan Today reports that Cathay Pacific on Aug. 10 reported losses
had narrowed in the first half after an "extremely difficult start"
to the year, but said its capacity will improve in coming months as
travel sentiment improves.
The US$637 million loss in January-June was narrower than the $968
million deficit suffered in the same period last year, as the
airline benefited from strong cargo demand and cost-cutting
measures, Japan Today discloses.
According to the report, Chairman Patrick Healey said in a
statement that the first few months were "particularly unfavorable"
as pandemic-related travel restrictions severely constrained
Cathay's flight operations and greatly affected demand for travel.
But he added that the airline was gearing up for borders reopening
and expected a stronger second-half.
Cathay aims to boost passenger flight capacity to a quarter of
pre-pandemic levels by the end of 2022, while it is looking to lift
cargo capacity to 65 percent, Mr. Healey said.
The airline carried 335,000 passengers in the first half of the
year, more than double that of the same period in 2021, bringing in
$263 million in revenue. Income from the cargo unit jumped 9.3
percent to $1.5 billion.
Total revenue was up 17 percent on-year at $2.4 billion, Japan
Today discloses.
According to the report, Hong Kong has taken tentative steps toward
reopening its borders after being internationally isolated for two
and a half years owing to strict COVID rules for travelers.
On Aug. 8, authorities said visitors would now have to spend just
three days in hotel quarantine, down from seven and much lower than
the three weeks earlier in the year.
Cathay praised the adjustments as "positive steps" but pressed the
government to "urgently provide a clear roadmap" to remove all
pandemic-related restrictions on passengers and aircrew.
The firm's ability to operate more flights "continues to be
severely constrained by a bottleneck on crewing resources under the
existing quarantine requirements", Healey said on Wednesday.
Last month, Hong Kong also suspended a circuit-breaker mechanism
that penalised airlines for bringing in coronavirus cases -- which
had affected numerous Cathay routes, including for key markets such
as the United States and Britain.
The airline operated just 29 destinations in January, compared with
more than 100 before the pandemic.
Hong Kong authorities are hinting at a potential international
reopening in November, timed to coincide with the high-profile
Rugby Sevens tournament and a banking summit.
Cathay is bringing aircraft parked overseas back to Hong Kong and
is aiming to hire more than 4,000 front-line employees over the
next 18 to 24 months, Mr. Healey said.
In June, Hong Kong also extended the drawdown period of a $1
billion bridge loan to Cathay -- the second time in two years -- as
part of a $5 billion government bailout to help the airline weather
the pandemic.
Hong Kong's home carrier suffered a reputational blow earlier this
year when a coronavirus outbreak was traced to two of its flight
attendants who breached their quarantine rules. They were fired and
later prosecuted.
About Cathay Pacific
Cathay Pacific Airways Ltd., is the flag carrier of Hong Kong, with
its head office and main hub located at Hong Kong International
Airport. Cathay operates scheduled airline services.
As reported in the Troubled Company Reporter-Asia Pacific on April
26, 2022, Egan-Jones Ratings Company, on March 23, 2022, maintained
its 'CC' foreign currency and local currency senior unsecured
ratings on debt issued by Cathay Pacific Airways Limited. EJR also
maintained its 'C' rating on commercial paper issued by the
Company.
HONG YANG: Fitch Corrects July 29 Ratings Release
-------------------------------------------------
Fitch Ratings issued a correction on a release on Hong Yang Group
Company Limited published on July 29, 2022. It includes the senior
unsecured rating of Hong Seng Limited that was downgraded to 'CC'
from 'B-' and removed from Rating Watch Negative (RWN), which was
omitted from the original release.
The amended release is as follows:
Fitch Ratings has downgraded the Long-Term Issuer Default Ratings
and senior unsecured ratings on China-based property developer Hong
Yang Group Company Limited and its subsidiary Redsun Properties
Group Limited to 'CC' from 'B-'. All ratings are removed from RWN.
The Recovery Rating remains at 'RR4'.
The downgrade reflects Redsun's increasing refinancing risks, amid
market reports that the company failed to make an interest payment
that was due on 13 July for a bond.
The company has not provided further information to Fitch beyond
its public announcements and Fitch was unable to verify the
non-payment of interest.
KEY RATING DRIVERS
Uncertain Bond Interest Payment: Redsun has not made any public
statements in response to market news that the company missed an
interest payment due on 13 July 2022 on its USD350 million notes
that mature on 13 January 2025. The company is in the 30-day grace
period for interest non-payment before an event of default is
triggered, the reports say. Fitch was unable to verify the accuracy
of this news.
Heightened Refinancing Risk: We believe the company may not be able
to access the capital market in the short term and expect it to
rely on cash on hand and internal cash flow to address upcoming
maturities in 2H22 and 1H23.
Fitch estimates Hong Yang and Redsun had over CNY5 billion of
available cash for debt repayment as of May 2022, including CNY0.5
billion-1 billion at Hong Yang alone (excluding Redsun and Redsun
Services) and CNY4.5 billion at Redsun. This appears sufficient to
cover only the group's debt maturities for the rest of 2022, but
will deplete its liquidity buffer.
Weak Contracted Sales: Redsun's total contracted sales fell by 60%
yoy in 6M22 to CNY19.6 billion, on the recent resurgence of
Covid-19 cases in China and related lockdowns, which led to weaker
housing demand and consumer confidence. Sales in June 2022
increased by 32% month-on-month to CNY4.1 billion, but we believe a
broader sales recovery in 2H22 remains uncertain and Redsun's
full-year contracted sales will probably decline by over 30%. The
weak sales will continue to hamper the company's cash flow
generation and build-up of its liquidity buffer.
DERIVATION SUMMARY
Hong Yang's ratings reflect the increasing refinancing risks amid
market reports about its non-payment of the bond interest.
KEY ASSUMPTIONS
Fitch's Key Assumptions Within Our Rating Case for the Issuers:
- Total contracted sales to decline by 36% in 2022 before
increasing by 3% a year in 2023-2025;
- Contracted average selling price to decrease by 15% in 2022
before recovering to low single-digit growth in 2023-2025;
- Property development gross profit margin of about 16.9% in
2022-2025 (2021: 18%);
- Minimal land acquisitions to prioritise debt repayment
KEY RECOVERY RATING ASSUMPTIONS
Fitch's recovery analysis assumes that Hong Yang and Redsun would
be liquidated in a bankruptcy, as they are essentially
asset-trading companies. The nature of homebuilding means the
liquidation-value approach will almost always result in a higher
value than the going-concern approach.
Fitch assumes a 10% administrative claim, in line with criteria.
Liquidation Approach
The liquidation estimate reflects our 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 Corporates Recovery Ratings and
Instrument Ratings Criteria.
- Advance rate of 58% applied to net property inventory. Redsun's
inventory consists mainly of completed properties held for sale,
properties under development (PUD) and deposits and prepayments for
land acquisition. Different advance rates were applied to the
various inventory categories to derive a blended advance rate.
- Advance rate of 65% applied to completed properties held for
sale. Completed commodity housing units are closer to readily
marketable inventory and Redsun has a historically strong gross
margin of around 20%. As such, we applied a higher advance rate
than under criteria.
- Advance rate of 55% applied to PUD. PUD are more difficult to
sell than completed projects and are at various stages of
completion. The PUD balance - prior to applying the advance rate -
is net of margin-adjusted customer deposits.
- Advance rate of 90% applied to deposits and prepayments for land
acquisitions. Similar to completed commodity housing units, land
held for development is closer to readily marketable inventory.
Redsun's land is mostly located in Tier 2 and 3 in the Yangtze
River Delta.
- Advance rate of 50% applied to property, plant and equipment,
which consists mainly of buildings, the value of which is
insignificant.
- Advance rate of 60% applied to Redsun's investment properties.
Redsun's investment property portfolio consists mainly of
commercial buildings located in the Yangtze River Delta area. The
portfolio has an average rental yield of 4%, in line with the
industry average.
- Advance rate of 100% applied to Hong Yang's investment
properties, excluding Redsun, based on a high rental yield of over
10% and the location of the assets.
- Advance rate of 50% applied to joint-venture net assets, which
typically include a combination of completed units, PUD and land
bank. The advance rate is in line with the baseline rate for
inventory.
- Advance rate of 0% applied to excess cash after netting the
amount of note payables and trade payables (construction fee and
retention payables).
The above items exclude the portion from Redsun Services Group Ltd,
the listed property-management arm of Hong Yang group. The recovery
value of Hong Yang's stake in Redsun Services is based on the
going-concern approach.
The allocation of value in the liability waterfall results in
recovery corresponding to a Recovery Rating of 'RR2' for Redsun's
senior unsecured offshore bonds and 'RR1' for Hong Yang's senior
unsecured bonds. However, the Recovery Rating for senior unsecured
debt is capped at 'RR4', because under Fitch's Country-Specific
Treatment of Recovery Ratings Criteria, China falls into Group D of
creditor friendliness, and Recovery Ratings of instruments from
issuers with assets in this group are subject to a cap of 'RR4'.
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
- Greater clarity on the repayment plans for capital-market
maturities
for the rest of 2022
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
- Failure to repay capital-market maturities or bond interest
falling
due in 2022
LIQUIDITY AND DEBT STRUCTURE
Tight Liquidity: Hong Yang and Redsun have large capital-market
maturities of CNY3.4 billion in the remainder of 2022 and CNY3
billion in 1H23. We think the group's access to capital markets
will probably remain limited in near term, and it will have to rely
on internal cash to repay debt. This will deplete its available
cash balance and reduce its liquidity buffer.
ISSUER PROFILE
Hong Yang owns 72% of Hong Kong-listed Redsun. Hong Yang group has
a property management services company Redsun Services, which was
separately listed in Hong Kong in July 2020, as well as a large
retail and wholesale centre for home decoration material and
furniture in Nanjing, Jiangsu province. Redsun develops residential
properties mainly in Jiangsu province. It also operates retail
malls, offices and hotels.
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.
Rating
------
Redsun Properties
Group Limited LT IDR CC Downgrade
senior unsecured LT CC Downgrade RR4
senior unsecured LT CC Downgrade RR4
Hong Seng Limited
senior unsecured LT CC Downgrade RR4
Hong Yang Group
Company Limited LT IDR CC Downgrade
senior unsecured LT CC Downgrade RR4
senior unsecured LT CC Downgrade RR4
=========
I N D I A
=========
AASTHA COLD: CARE Keeps D Debt Rating in Not Cooperating
--------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Aastha Cold
Storage (ACS) continues to remain in the 'Issuer Not Cooperating'
category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Bank 7.90 CARE D; ISSUER NOT COOPERATING
Facilities Rating continues to remain
under ISSUER NOT COOPERATING
category
Detailed Rationale & Key Rating Drivers
CARE Ratings Ltd. had, vide its press release dated June 4, 2021,
placed the rating(s) of ACS under the 'issuer non-cooperating'
category as ACS had failed to provide information for monitoring of
the rating and had not paid the surveillance fees for the rating
exercise as agreed to in its Rating Agreement. ACS continues to be
non-cooperative despite repeated requests for submission of
information through e-mails, phone calls and a letter/email dated
April 20, 2022, April 30, 2022, May 10, 2022.
In line with the extant SEBI guidelines, CARE Ratings Ltd. has
reviewed the rating on the basis of the best available information
which however, in CARE Ratings Ltd.'s opinion is not sufficient to
arrive at a fair rating.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating(s).
Deesa-based (Gujarat) Aastha Cold Storage (ACS) is a partnership
firm engaged in the business of providing cold storage services.
Established in the year 2013, ACS is operating from its plant
located at Modasa-Gujarat. ACS has installed capacity of 5000
metric tonnes of storage capacity as of March 31, 2015.
ADHUNIK POWER: CARE Keeps D Debt Rating in Not Cooperating
----------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Adhunik
Power & Natural Resources Limited (APNRL) continues to remain in
the 'Issuer Not Cooperating' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Bank 90.0 CARE D; ISSUER NOT COOPERATING
Facilities Rating continues to remain
under ISSUER NOT COOPERATING
category
Detailed rationale and key rating drivers
CARE Ratings Ltd. had, vide its press release dated March 20, 2018,
placed the rating(s) of APNRL under the 'issuer non-cooperating'
category as APNRL had failed to provide information for monitoring
of the rating. APNRL continues to be non-cooperative despite
repeated requests for submission of information through e-mails,
phone calls and letter/emails dated July 22, 2022 and July 25,
2022.
In line with the extant SEBI guidelines, CARE Ratings Ltd. has
reviewed the rating on the basis of the best available information
which however, in CARE Ratings Ltd.'s opinion is not sufficient to
arrive at a fair rating.
At the request of Adhunik Power & Natural Resources Limited and
based on Audited Report for FY21, CARE has withdrawn the ratings of
bank facilities of APNRL as all the bank facilities have been taken
over by another lender, except facilities of Life Insurance
Corporation of India (LICI), with new terms and conditions and no
longer with existing lenders rated by CARE. Also, facilities of
Bank of Baroda have been repaid based on One Time Settlement
(OTS).
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating(s).
Detailed description of the key rating drivers
At the time of last rating on January 27, 2022 the following were
the rating strengths and weaknesses (updated for the information
available from Registrar of companies):
Key Rating Weaknesses
* On-going delays in debt servicing: APNRL's debt servicing track
record is characterized by delays in servicing of its debt
obligations. The increase in raw material prices on account of
de-allocation of coal mines led to negative cash accruals. Further
the company continues to have elongated operating cycle of the
company as characterised through its extended debtor's collection
period which has resulted in a stretched liquidity position of the
company.
Incorporated on May 3, 2005 and promoted by the Kolkata-based
Adhunik group, APNRL (erstwhile known as Adhunik Thermal Energy
Ltd.), operates a 540 MW coal-based thermal power plant in Kandra,
Saraikela district of Jharkhand. The plant has been set up at a
cost of INR3,376.7 crore (i.e.; INR6.25 crore per MW), being
financed at a debt-equity ratio of 2.74:1. The plant had been
commissioned in two phases - Phase I (270 MW) was commissioned in
Jan 2013; and Phase II (270 MW) got commissioned in May
2013.Adhunik group is engaged in manufacturing of steel with
interests in coal, manganese & iron ore mining. The company has
gone under Strategic Debt Restructuring (SDR) in December 2015.
AG8 VENTURES: Insolvency Resolution Process Case Summary
--------------------------------------------------------
Debtor: AG8 Ventures Limited
Aakriti House
E-8 Extension
Aakrii Eco City
(In front the Nest Aakriti Eco City)
Bawadia Kalan, Bhopal
Madhya Pradesh 462026
Insolvency Commencement Date: August 11, 2022
Court: National Company Law Tribunal, Indore Bench
Estimated date of closure of
insolvency resolution process: February 7, 2023
Insolvency professional: Mr. Anil Goel
Interim Resolution
Professional: Mr. Anil Goel
E-10A, Kailash Colony
Greater Kailash-1
New Delhi 110048
E-mail: anilgoel@aaainsolvency.com
- and –
AAA Insolvency Professionals LLP
E-10A, Lower Ground Floor
Kailash Colony, Greater Kailash-1
New Delhi 110048
E-mail: ag8@aaainsolvecny.com
Classes of creditors: Home Buyers
Insolvency
Professionals
Representative of
Creditors in a class: Mr. Piyush Kumar Kapoor
Mr. Saurabh Dhoot
Mr. Sanjay Kumar Gupta
Last date for
submission of claims: August 27, 2022
AMEREX PRIVATE: Insolvency Resolution Process Case Summary
----------------------------------------------------------
Debtor: Amerex Private Limited
Registered office:
1/20, Asaf Ali Road
Delhi 110002
New Delhi
India
Also at:
Pinnacle Business Park
Sector 3, Noida
Uttar Pradesh 201301
Insolvency Commencement Date: August 10, 2022
Court: National Company Law Tribunal, Bench-IV, New Delhi
Estimated date of closure of
insolvency resolution process: February 1, 2023
(180 days from commencement)
Insolvency professional: Mr. Varun Sethi
Interim Resolution
Professional: Mr. Varun Sethi
B1, First Floor, C85A
Street No. 7, C Block
Phase 2, Chhatarpur Enclave
Near 100FT Road
Chhatarpur, South West
National Capital Territory of Delhi
110074
E-mail: ca.varun.sethi.81@gmail.com
- and -
B1, 1603 Puri Emerald Bay
Dwarka Expressway
Sector 104, Tower B
Gurugram 122006
E-mail: cirp.amerex@gmail.com
Last date for
submission of claims: August 24, 2022
ANAND ELECTRICALS: CRISIL Keeps D Debt Ratings in Not Cooperating
-----------------------------------------------------------------
CRISIL Ratings said the ratings on bank facilities of Anand
Electricals (AE) continue to be 'CRISIL D/CRISIL D Issuer Not
Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Bank Guarantee 1 CRISIL D (Issuer Not
Cooperating)
Cash Credit 2 CRISIL D (Issuer Not
Cooperating)
Letter of Credit 2 CRISIL D (Issuer Not
Cooperating)
Proposed Long Term 10 CRISIL D (Issuer Not
Bank Loan Facility Cooperating)
CRISIL Ratings has been consistently following up with AE for
obtaining information through letters and emails dated May 24, 2022
and July 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 AE, which restricts CRISIL
Ratings' ability to take a forward-looking view on the entity's
credit quality. CRISIL Ratings believes that rating action on AE is
consistent with 'Assessing Information Adequacy Risk'. Based on the
last available information, the ratings on bank facilities of AE
continues to be 'CRISIL D/CRISIL D Issuer Not Cooperating'.
Formed in 2005 as a proprietorship firm by Mr. Ramakrishna Vetal,
AE, an EPC contractor, undertakes projects to set up transmission
lines and towers for public and private entities.
ANGEL PROMOTERS: CRISIL Keeps C Debt Rating in Not Cooperating
--------------------------------------------------------------
CRISIL Ratings said the rating on bank facilities of Angel
Promoters Private Limited (APPL) continues to be 'CRISIL C Issuer
Not Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Term Loan 20 CRISIL C (Issuer Not
Cooperating)
CRISIL Ratings has been consistently following up with APPL for
obtaining information through letters and emails dated May 10, 2022
and July 11, 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 APPL, which restricts CRISIL
Ratings' ability to take a forward-looking view on the entity's
credit quality. CRISIL Ratings believes that rating action on APPL
is consistent with 'Assessing Information Adequacy Risk'. Based on
the last available information, the ratings on bank facilities of
APPL continues to be 'CRISIL C Issuer Not Cooperating'.
Established in 2006 in Sahibabad, Uttar Pradesh (UP), by Mr. DB
Jain and his son, Mr. Abhishek Jain, APPL is engaged in real estate
development and has currently undertaken a hotel-cum-banquet halls
project in Sahibabad, which is expected to commence operations in
2016-17. The company completed a group housing project,Angel
Mercury, in Indirapuram, UP, in 2012.
ANLON HEALTHCARE: CARE Keeps D Debt Ratings in Not Cooperating
--------------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Anlon
Healthcare Private Limited (AHPL) continues to remain in the
'Issuer Not Cooperating' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Bank 11.50 CARE D; ISSUER NOT COOPERATING
Facilities Rating continues to remain
under ISSUER NOT COOPERATING
category
Long Term/ 3.00 CARE D/CARE D; ISSUER NOT
Short Term COOPERATING; Rating continues
Bank Facilities to remain under ISSUER NOT
COOPERATING category
Detailed Rationale & Key Rating Drivers
CARE Ratings Ltd. had, vide its press release dated June 2, 2021,
placed the rating(s) of AHPL under the 'issuer non-cooperating'
category as AHPL had failed to provide information for monitoring
of the rating and had not paid the surveillance fees for the rating
exercise as agreed to in its Rating Agreement. AHPL continues to be
noncooperative despite repeated requests for submission of
information through e-mails, phone calls and a letter/email dated
April 18, 2022, April 28, 2022, May 8, 2022.
In line with the extant SEBI guidelines, CARE Ratings Ltd. has
reviewed the rating on the basis of the best available information
which however, in CARE Ratings Ltd.'s opinion is not sufficient to
arrive at a fair rating.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating(s).
Rajkot (Gujarat)-based, AHPL was incorporated in March 20, 2014 by
three directors namely Mr. Punit Rasadia, Mr. Vaibhav Ramani and
Mr. Meet Vachhani. The company is setting up a unit for
manufacturing of pharma intermediates and ingredients. The company
will operate with an installed capacity of 11 metric tonne per
month of pharma intermediates and ingredients which will find its
application in preparation of medicines. Anlon Healthcare Private
Limited belongs to Anlon group with group entity named Anlon
Chemical Research Organization.
BENCO THERMAL: CRISIL Withdraws B+ Rating on INR4cr Cash Loan
-------------------------------------------------------------
CRISIL has withdrawn the ratings on certain bank facilities of
Benco Thermal Technologies Private Limited (BTTPL), as:
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Bank Guarantee 5 CRISIL A4/Issuer Not
Cooperating (Withdrawn)
Cash Credit 4 CRISIL B+/Stable/Issuer Not
Cooperating (Withdrawn)
CRISIL Ratings has been consistently following up with BTTPL for
obtaining information through letters and emails dated July 21,
2022 & July 26, 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 BTTPL, which restricts CRISIL
Ratings' ability to take a forward-looking view on the entity's
credit quality. CRISIL Ratings believes that rating action on SMPL
is consistent with 'Assessing Information Adequacy Risk'. CRISIL
Ratings has migrated the ratings on the bank facilities of SMPL to
'CRISIL B+/Stable/CRISIL A4 Issuer Not Cooperating' from 'CRISIL
B+/Stable/CRISIL A4'.
CRISIL Ratings has withdrawn its rating on INR4 Crore Cash credit,
INR5 Crore bank Guarantee of BTTPL 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.
Incorporated in 1988, BTTPL designs, manufactures, supplies,
erects, and commissions heating and heat treatment furnaces and
associated equipment on turnkey basis. The manufacturing facility
is in Chennai. The operations of the company are managed by Mr. P
Ramachandran and Mr. R Rangarajan.
BHAVANI RICE: CARE Keeps D Debt Rating in Not Cooperating
---------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Bhavani
Rice Mill (BRM) continues to remain in the 'Issuer Not Cooperating'
category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Bank 7.00 CARE D; ISSUER NOT COOPERATING
Facilities Rating continues to remain
under ISSUER NOT COOPERATING
category
Detailed Rationale & Key Rating Drivers
CARE Ratings Ltd. had, vide its press release dated June 30, 2021,
placed the rating(s) of BRM under the 'issuer non-cooperating'
category as BRM had failed to provide information for monitoring of
the rating and had not paid the surveillance fees for the rating
exercise as agreed to in its Rating Agreement. BRM continues to be
non-cooperative despite repeated requests for submission of
information through e-mails, phone calls and a letter/email dated
May 16, 2022, May 26, 2022, June 5, 2022.
In line with the extant SEBI guidelines, CARE Ratings Ltd. has
reviewed the rating on the basis of the best available information
which however, in CARE Ratings Ltd.'s opinion is not sufficient to
arrive at a fair rating.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating(s).
Bavla (Gujarat) based Bhavani Rice Mill (BRM) was established in
1975 as a proprietorship firm by Mr. Bhailalbhai Patel and later
converted into partnership firm. BRM is engaged in the milling and
processing of non-basmati rice. BRM is operating from its sole
manufacturing plant located in Bavla (Gujarat) having installed
paddy processing capacity of 100 Metric Tonnes per day as on March
31, 2017.
BHAVI CREATIONS: CRISIL Keeps D Debt Rating in Not Cooperating
--------------------------------------------------------------
CRISIL Ratings said the ratings on bank facilities of Bhavi
Creations (BC) continue to be 'CRISIL D Issuer Not Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 5.5 CRISIL D (Issuer Not
Cooperating)
Proposed Long Term 4.5 CRISIL D (Issuer Not
Bank Loan Facility Cooperating)
CRISIL Ratings has been consistently following up with BC for
obtaining information through letters and emails dated May 24, 2022
and July 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 BC, which restricts CRISIL
Ratings' ability to take a forward-looking view on the entity's
credit quality. CRISIL Ratings believes that rating action on BC is
consistent with 'Assessing Information Adequacy Risk'. Based on the
last available information, the ratings on bank facilities of BC
continue to be 'CRISIL D Issuer Not Cooperating'.
BC is a proprietorship firm set up in 1970, by Mr. Pritpal Singh.
The Delhi-based firm trades in various types of fabrics, including
cotton, denim, suiting and shirting.
CHITTARANJAN MULTI: CRISIL Keeps D Ratings in Not Cooperating
-------------------------------------------------------------
CRISIL Ratings said the ratings on bank facilities of Chittaranjan
Multipurpose Heemghar Private Limited (CMHPL) continue to be
'CRISIL D Issuer Not Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 1 CRISIL D (Issuer Not
Cooperating)
Cash Credit 5.6 CRISIL D (Issuer Not
Cooperating)
Term Loan 7.4 CRISIL D (Issuer Not
Cooperating)
CRISIL Ratings has been consistently following up with CMHPL for
obtaining information through letters and emails dated May 24, 2022
and July 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 CMHPL, which restricts CRISIL
Ratings' ability to take a forward-looking view on the entity's
credit quality. CRISIL Ratings believes that rating action on CMHPL
is consistent with 'Assessing Information Adequacy Risk'. Based on
the last available information, the ratings on bank facilities of
CMHPL continue to be 'CRISIL D Issuer Not Cooperating'.
Incorporated in 2012 and promoted by Mr. Kartik Ghosh and Ms Jhulan
Ghosh, CMHPL provides cold storage services to potato farmers and
traders, and also undertakes opportunistic trading of potatoes.
Unit in Hooghly, West Bengal, commenced operations in March 2017.
CP ARORA: Ind-Ra Assigns BB+ LT Issuer Rating, Outlook Stable
-------------------------------------------------------------
India Ratings and Research (Ind-Ra) has assigned C.P. Arora
Engineers-Contractors Private Limited (CPA) a Long-Term Issuer
Rating of 'IND BB+'. The Outlook is Stable.
The instrument-wise rating actions are given below:
-- INR182.50 mil. Fund-based limits assigned with IND BB+/Stable/
IND A4+ rating;
-- INR82.20 mil. Non-fund-based limits assigned with IND A4+
rating; and
-- INR35.30 mil. Proposed non-fund-based limits assigned with
IND A4+ rating.
Key Rating Drivers
The ratings reflect CPA's medium scale of operations as indicated
by its revenue of INR2,662 million in FY22 (FY21: INR1,996 million,
FY20: INR620 million). The growth in revenue was driven by a
consistent increase in the number of orders received. As of 30 June
2022, it had a strong order book of INR5,418.92 million (2.2x of
FY22 revenue), to be executed during FY23-FY24. Around 71% of the
total order book was for road construction from the National
Highways Authority of India (IND AAA/Stable; 100% through
subcontracting), 15% from the Public Works Department, 7% from Tata
Projects Limited (TPL; IND AA/Stable) and Yamuna International
Airport Private Limited (IND A-/Stable) for Noida International
Airport, and the rest from Delhi International Airport Limited
(debt rated at IND A+/Stable), Puintola Tollway Pvt. Ltd and
Icchapuram Tollway Pvt Ltd. Around 23% of the total order book
needs to be completed by September 2022. Furthermore, the company
expects to receive INR5,000 million of work orders from TPL for
Noida International Airport. The company booked revenue of INR689.7
million in 1QFY23 and is expected by the management to book around
INR3,000 million in FY23 on the back of a strong order book. FY22
financials are provisional.
Liquidity Position - Stretched: CPA's average peak use of the
fund-based limits was 98% during the 12 months ended June 2022. The
cash flow from the operations increased to around INR197 million in
FY22 (FY21: INR126 million, FY20: INR34 million) due to an increase
in the EBITDA to INR273 million (INR175 million, INR121 million).
The company had an unencumbered cash balance of around INR3.60
million at FYE22 (FYE21: INR5.63 million). The company also uses
fixed deposits backed by bill guarantees (FY22E: INR90 million) as
the sanctioned bank guarantee was only INR82 million. The company
has applied for the enhancement of the non-fund-based limits which
would partially release the tied-up fixed deposits. The company's
fund-based limits have reduced to INR167.50 million from INR182.50
million, and would further reduce by INR5 million in FY23. The
company has scheduled repayments of INR45 million and INR10 million
in FY23 and FY24, respectively. CPA does not have any capital
market exposure and relies on banks and financial institutions to
meet its funding requirements.
Ind Ra believes that working capital management would be critical
due to the reduced fund-based working capital limits, in case of an
elongation of the net working capital cycle (FY22: 41 days: FY21:
19 days) and an increase in the working capital requirement in line
with the expected revenue growth.
However, the ratings are supported by the company's strong EBITDA
margins of 10.26% in FY22 (FY21: 8.76%) due to better absorption of
fixed cost, resulting from the increase in the top line. Its return
on capital employed was 39% in FY22 (FY21: 26%; FY20: 14%).
Ind-Ra expects the margins to remain in the range of 8%-10% in the
short term, as the company works on cost-plus conversion basis in a
few orders while in others, it has a price escalation clause.
The ratings also benefit from CPA's comfortable credit metrics as
indicated by the interest coverage (operating EBITDA/gross interest
expense of 6.9x in FY22 (FY21: 3.8x, FY20: 2.2x) and the net
leverage (total adjusted net debt/operating EBITDAR) of 0.9x (1.9x,
3.1x). The improvement in the credit metrics was due to the
increase in EBITDA. The company takes loans for the purchase of
machinery and vehicles for road construction and other works. At
FYE22, it had outstanding term loans of INR55 million. Of the total
debt of INR236.91 million at FYE22, 69% was in the form of working
capital loans, 23% in the form of term loans and the rest was
unsecured loans from directors and relatives. CPA's promoter
provides funds in the business, if required. The company partially
repaid its unsecured loans from internal accruals during FY21-FY22.
Ind-Ra expects the credit metrics to remain comfortable due to the
presence of adequate profitability, low debt, and absence of any
significant debt-led capex in the medium term.
The ratings also derive comfort from the promoter's over two
decades of experience in the road construction sector.
Rating Sensitivities
Positive: Sustaining the scale of operations and credit metrics,
along with an improvement in the liquidity position and order book
profile, would lead to a positive rating action.
Negative: Deterioration in the scale of operations and/or liquidity
position leading to the interest coverage reducing below 1.75x on a
sustained basis, would lead to a negative rating action.
Company Profile
Incorporated in 2003, CPA undertakes tender-based road projects on
a sub-contract basis. The company is also involved in various
ancillary works, required for the completion of a road project,
including the construction of footpaths, walkways, cross drainage
works, culverts, sewer lines, water supply lines, and landscaping
jobs. The company is managed by Karun Arora.
DANIA ORO: CRISIL Keeps D Debt Ratings in Not Cooperating
---------------------------------------------------------
CRISIL Ratings said the ratings on bank facilities of Dania Oro
Jewellery Private Limited continue to be 'CRISIL D/CRISIL D Issuer
Not Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Packing Credit 12.5 CRISIL D (Issuer Not
Cooperating)
Post Shipment 12.5 CRISIL D (Issuer Not
Credit Cooperating)
Proposed Long Term 17.31 CRISIL D (Issuer Not
Bank Loan Facility Cooperating)
CRISIL Ratings has been consistently following up with Dania Oro
for obtaining information through letters and emails dated May 24,
2022 and July 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 Dania Oro, which restricts
CRISIL Ratings' ability to take a forward-looking view on the
entity's credit quality. CRISIL Ratings believes that rating action
on Dania Oro is consistent with 'Assessing Information Adequacy
Risk'. Based on the last available information, the ratings on bank
facilities of Dania Oro continues to be 'CRISIL D/CRISIL D Issuer
Not Cooperating'.
Dania Oro was incorporated in 2006, promoted by Mr. Pramod Goenka
of Mumbai. The company exports diamond studded gold jewellery to
the US and UK.
DYNAMIX CHAINS: CRISIL Keeps D Debt Ratings in Not Cooperating
--------------------------------------------------------------
CRISIL Ratings said the ratings on bank facilities of Dynamix
Chains Manufacturing Private Limited continue to be 'CRISIL
D/CRISIL D Issuer Not Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Funded Interest 4.97 CRISIL D (Issuer Not
Term Loan Cooperating)
Packing Credit 5 CRISIL D (Issuer Not
Cooperating)
Post Shipment 9 CRISIL D (Issuer Not
Credit Cooperating)
Proposed Long Term 35.15 CRISIL D (Issuer Not
Bank Loan Facility Cooperating)
Term Loan 2.84 CRISIL D (Issuer Not
Cooperating)
Working Capital 15.89 CRISIL D (Issuer Not
Demand Loan Cooperating)
CRISIL Ratings has been consistently following up with Dynamix for
obtaining information through letters and emails dated May 24, 2022
and July 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 Dynamix, which restricts CRISIL
Ratings' ability to take a forward-looking view on the entity's
credit quality. CRISIL Ratings believes that rating action on
Dynamix is consistent with 'Assessing Information Adequacy Risk'.
Based on the last available information, the ratings on bank
facilities of Dynamix continue to be 'CRISIL D/CRISIL D Issuer Not
Cooperating'.
Dynamix, established in October 2007, is promoted by Mr. Pramod
Goenka of Mumbai. It manufactures specialized chains and pendants,
which are exported to the US.
FENIX PROCESS: CRISIL Keeps D Debt Ratings in Not Cooperating
-------------------------------------------------------------
CRISIL Ratings said the ratings on bank facilities of Fenix Process
Technologies Private Limited (FPTPL) continue to be 'CRISIL
D/CRISIL D Issuer Not Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Bank Guarantee 8 CRISIL D (Issuer Not
Cooperating)
Cash Credit 6.5 CRISIL D (Issuer Not
Cooperating)
Export Packing 8 CRISIL D (Issuer Not
Credit Cooperating)
Proposed Long Term 1.02 CRISIL D (Issuer Not
Bank Loan Facility Cooperating)
Term Loan 6.48 CRISIL D (Issuer Not
Cooperating)
CRISIL Ratings has been consistently following up with FPTPL for
obtaining information through letters and emails dated May 10, 2022
and July 11, 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 FPTPL, which restricts CRISIL
Ratings' ability to take a forward-looking view on the entity's
credit quality. CRISIL Ratings believes that rating action on FPTPL
is consistent with 'Assessing Information Adequacy Risk'. Based on
the last available information, the ratings on bank facilities of
FPTPL continue to be 'CRISIL D/CRISIL D Issuer Not Cooperating'.
Incorporated in 2006 and based in Pune, FPTPL is promoted by Mr. M
V Rao. The company undertakes process engineering and
manufacturing, involving the provision of complete design,
engineering, and equipment solutions for distillation and other
mass-transfer operations.
FUTURE ENTERPRISES: Creditor Files Insolvency Bid in NCLT
---------------------------------------------------------
Livemint.com reports that Future Enterprises Ltd said an
operational creditor of the company has filed a plea before the
National Company Law Tribunal (NCLT) to initiate insolvency
proceedings against it. Future Enterprises Ltd (FEL), part of the
Kishore Biyani-led Future Group, is facing difficulties like other
firms of the group.
"Foresight Innovations Private Limited . . . Operational Creditors
of the Company had filed an application under Section 9 of the
Insolvency and Bankruptcy Code 2016 for an alleged default amount
of INR1.58 crore -with National Company Law Tribunal, Mumbai Bench
(NCLT)," Future Enterprises said in a regulatory filing.
The next date of hearing is Aug. 26, 2022, it added, Livemint.com
relays.
Section 9 of the Insolvency and Bankruptcy Code (IBC) gives power
to operational creditors of a company to initiate corporate
insolvency resolution process in case of a default.
On Aug. 16, its Non-Executive Director Chandrapraksh Toshniwal
resigned from the board of directors, Livemint.com reports.
FEL was part of the 19 group companies operating in retail,
wholesale, logistics and warehousing segments which were supposed
to be transferred to Reliance Retail as part of a INR24,713-crore
deal announced in August 2020, the report recalls.
The deal was called off by the billionaire Mukesh Ambani-led
Reliance Industries Ltd in April.
It had recently committed several defaults on payment of interest
on its several non-convertible debentures.
Livemint.com says the NCLT has already initiated insolvency
proceedings against Future Group's flagship firm Future Retail
Ltd.
Livemint.com meanwhile reports that e-commerce major Amazon has
moved Supreme Court against an order of the National Company Law
Appellate Tribunal (NCLAT), which upheld fair trade regulator CCI's
decision to suspend its approval for investment in a Future Group
company.
According to the report, the NCLAT on June 13 rejected Amazon's
plea challenging the decision of the Competition Commission of
India (CCI) to suspend the approval for the e-commerce major's deal
with Future Coupons and directed the company to pay over INR200
crore penalty imposed on it, within next 45 days.
Livemint.com relates that the said order has now been challenged by
Amazon before the apex court. In its petition, a copy of which has
been seen by PTI, the e-commerce major has said the NCLAT order has
several glaring defects and suffers from a total non-application of
mind by the appellate tribunal.
Livemint.com says the matter is expected to be listed this week
before the apex court. In December last year, the CCI suspended the
approval given by it in 2019 for Amazon's deal to acquire a 49 per
cent stake in Future Coupons Pvt Ltd (FCPL).
The regulator had said that Amazon suppressed information while
seeking clearances for the transaction back then and also slapped a
fine of INR202 crore on the company.
This includes a INR200 crore penalty for Amazon to notify the
combination in the requisite terms and two penalties of ₹1 crore
each for suppressing the actual scope and purpose of the
combination.
According to Livemint.com, the CCI order was challenged by Amazon
before the NCLAT, an appellate authority over the fair trade
regulator, which in turn upheld the findings.
The NCLAT said the e-commerce major "has not made full, whole,
forthright and frank disclosures of relevant materials and had
furnished only limited details/disclosures, pertaining to its
'acquiring strategic rights and interests' over "FRL (Future Retail
Ltd)" and executing the commercial contract.
"In this regard, this appellate tribunal is in complete agreement
with the view arrived at by the first respondent (CCI) . . . ",
NCLAT had said.
Future Enterprises Limited owns and operates retail stores. The
Company offers a variety of household, consumer and fashion
products and also engaged in manufacturing of garments.
HANSRAJ MEMORIAL: CARE Keeps D Debt Ratings in Not Cooperating
--------------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Hansraj
Memorial Educational Society (HMES) continues to remain in the
'Issuer Not Cooperating' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Bank 19.90 CARE D; ISSUER NOT COOPERATING
Facilities Rating continues to remain
under ISSUER NOT COOPERATING
category
Short Term Bank 13.00 CARE D; ISSUER NOT COOPERATING
Facilities Rating continues to remain
under ISSUER NOT COOPERATING
category
Detailed Rationale & Key Rating Drivers
CARE Ratings Ltd. had, vide its press release dated July 07, 2021,
placed the rating(s) of HMES under the 'issuer non-cooperating'
category as HMES had failed to provide information for monitoring
of the rating and had not paid the surveillance fees for the rating
exercise as agreed to in its Rating Agreement. HMES continues to be
noncooperative despite repeated requests for submission of
information through e-mails, phone calls and a letter/email dated
May 23, 2022, June 2, 2022, June 12, 2022.
In line with the extant SEBI guidelines, CARE Ratings Ltd. has
reviewed the rating on the basis of the best available information
which however, in CARE Ratings Ltd.'s opinion is not sufficient to
arrive at a fair rating.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating(s).
Hansraj Memorial Educational Society (HMES) is a part of Jalandhar
(Punjab) based Airwings Services group which is engaged in the
business of tours & travels and HR management. HMES was founded by
Late Mr. Hans Raj Bhatia under the Societies Registration Act of
India on February 1, 2000. Mr. Ajay Bhatia is the President of the
society and his brother, Mr. Deepak Bhatia, is the General
Secretary. HMES is currently operating three schools in the
Jalandhar city- Cambridge International school for girls (CISFG;
established in 2005), Cambridge International School Co-ed (CISC;
established in 2008) and Cambridge International (CISFG;
established in 2005), Cambridge International School Co-ed (CISC;
established in 2008) and Cambridge International Foundation School
(CIFS; established in 2012) and is setting up a new school in
Mohali (Punjab). The schools are affiliated to CBSE (Central Board
of Secondary Education) and are ISO-9001:2008 accredited.
HINDUSTAN TANKERS: Insolvency Resolution Process Case Summary
-------------------------------------------------------------
Debtor: Hindustan Tankers Private Limited
Highway Fuels, Salakhedi
Mhow-Neemuch Road
Ratlam, MP 457001
IN
Insolvency Commencement Date: August 8, 2022
Court: National Company Law Tribunal, Indore Bench
Estimated date of closure of
insolvency resolution process: February 4, 2023
Insolvency professional: Chhaya Gupta
Interim Resolution
Professional: Chhaya Gupta
1, Bima Nagar
202, Almas Dreams Apartment
Near Anand Bazaar
Indore 452018
MP
E-mail: guptachayacs@gmail.com
- and -
911, Apollo Premier
Near Vijay Nagar Square
Indore 452010
MP
E-mail: cirp.htpvtltd@gmail.com
Last date for
submission of claims: August 22, 2022
JUBILANT PHARMA: S&P Lowers LT ICR to 'BB-' Then Withdraws Rating
-----------------------------------------------------------------
S&P Global Ratings lowered its long-term issuer rating on Jubilant
Pharma Ltd. and the long-term issue rating on its US$200 million
senior unsecured notes to 'BB-' from 'BB'. The recovery rating on
the notes is '3'.
S&P then withdrew all the ratings at the company's request. The
outlook was stable at the time of the withdrawal.
Weakness in Jubilant Pharma's generics business will weigh on
earnings and credit metrics. S&P anticipates the generics business'
earnings will remain weak over the rest of fiscal 2023 in the
absence of new product approvals and amid import restrictions
imposed by the U.S. Food and Drug Administration (USFDA) on the
company's Roorkee facility. Pricing pressure in the highly
competitive U.S. generics market and negligible revenues from
COVID-related drugs (Remdesivir) are also likely to remain a drag
on earnings. These factors will offset a recovery in Jubilant
Pharma's radiopharmaceuticals business and stable performance of
the allergy therapy and contract manufacturing operations.
S&P said, "We estimate Jubilant Pharma's EBITDA will be about
Indian rupee (INR) 10 billion in fiscal 2023, compared with about
INR12 billion in fiscal 2022. The group's EBITDA should thereafter
recover to fiscal 2021 levels of INR14 billion-INR15 billion in
fiscal 2024. This is based on a turnaround in the generics
business, assuming the challenges at the Roorkee facility are
resolved at the end of fiscal 2023.
"Our assessment of Jubilant Pharma's credit profile is based on
parent Jubilant Pharmova Ltd. This is because we consider Jubilant
Pharma core to the group. Jubilant Pharma is the holding company
for the group's key pharmaceutical assets. These contribute to over
90% of the group's revenues and EBITDA and also account for the
majority of the group's debt. We therefore consider Jubilant
Pharma's credit quality to be the same as that of the parent.
"Increased capital investments will restrict deleveraging at
Jubilant Pharma over the next two years. We expect the group's debt
to remain stable at INR33 billion-INR35 billion over the next two
years, compared with about INR32 billion as of March 31, 2022.
Still, leverage is likely to remain elevated absent a recovery in
earnings. We estimate the group's debt-to-EBITDA ratio at 3.0x-3.5x
in fiscal 2023 and about 2.5x in fiscal 2024. This is materially
above our threshold of about 2x for a 'BB' rating."
Jubilant Pharma announced incremental capex of about INR22 billion
(US$275 million) over the past six months to increase its sterile
injectables contract manufacturing capacities at Spokane and
Montreal. The company will receive a grant of about INR11.5 billion
(US$150 million) from the U.S. government and a term loan of about
INR1.5 billion (US$20 million) from the government of Quebec to
fund this capex. S&P now expects the group to spend about INR10
billion annually over the next two years. While the expansion
offers potential business profile and earnings benefit, these will
accrue beyond fiscal 2024.
Jubilant Pharma has sufficient liquidity following a refinancing of
its existing debt.The company is refinancing its outstanding US$200
million senior unsecured notes due March 2024 and US$150 million
amortizing term loan through a new bank loan. This improves the
group's financial flexibility by extending its debt maturities,
especially refinancing of the unsecured notes.
ESG credit indicators: E-2, S-2, G-3
KOMAL KAKADE: Insolvency Resolution Process Case Summary
--------------------------------------------------------
Debtor: Komal Kakade Construction Private Limited
Kakade Capital
1205, Shirole Road
Near P. Jog Class
Opp. Sambhaji Park
JM Road, Shivaji Nagar
Pune, MH 411005
IN
Insolvency Commencement Date: August 11, 2022
Court: National Company Law Tribunal, Pune Bench
Estimated date of closure of
insolvency resolution process: February 6, 2023
Insolvency professional: Vinit Gangwal
Interim Resolution
Professional: Vinit Gangwal
Office No. 503, 5th Floor
Varun Capital, CTS No. 364-365/13
Off JM Road, Bharat Petroleum Lane
Next to Citiotel, Shivaji Nagar
Pune 411005
E-mail: ip.vinitgangwal@sudharman.in
- and -
Sankalp Resolution Professionls LLP
401, 4th Floor, The Central Building
Shell Colony Road, Chembur (East)
Mumbai 400071
E-mail: ip.komalkakade@sankalp-ipe.com
Last date for
submission of claims: August 24, 2022
KRISH AGRO: CRISIL Reaffirms B+ Rating on INR12cr Cash Loan
-----------------------------------------------------------
CRISIL Ratings has reaffirmed its 'CRISIL B+/Stable' rating on the
long-term facilities of Krish Agro Farms Private Limited (KAFPL).
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 12 CRISIL B+/Stable (Reaffirmed)
Proposed Cash
Credit Limit 2.05 CRISIL B+/Stable (Reaffirmed)
Term Loan 3.75 CRISIL B+/Stable (Reaffirmed)
Term Loan 4.20 CRISIL B+/Stable (Reaffirmed)
The rating continues to reflect KAFPL's susceptibility to climatic
conditions and volatility in raw material prices, and modest scale
of operation amid intense competition. These weaknesses are
partially offset by the extensive experience of the promoter and
the company's efficient working capital management.
Analytical Approach
Unsecured loan of INR4.89 crore from the promoter as on March 31,
2022, has been treated as neither debt nor equity, as the loan is
expected to remain in the business
Key Rating Drivers & Detailed Description
Weaknesses:
* Susceptibility to climatic conditions and volatility in raw
material prices: The crop yield of agricultural commodities is
dependent upon adequate and timely monsoons. Thus, the company is
exposed to the risk of limited availability of its key raw material
during a weak monsoon. Also, production may be impacted by pests or
crop infection, leading to higher unpredictability in the
production and pricing of agricultural commodities and derived
products.
* Modest scale of operation amid intense competition: Revenue has
remained at INR79-86 crore over the last three fiscals, scale of
operation remains modest because of intense competition in the rice
milling industry and limited value-addition. The scale is likely to
improve over the medium term.
Strengths:
* Extensive experience of the promoter: The two-decade-long
experience of the promoter in the rice milling industry, his strong
understanding of market dynamics and healthy relationships with
suppliers and customers should continue to support the business.
* Efficient working capital management: Gross current assets were
78-106 days in the past three fiscals (99 days as on March 31,
2022) against over 120 days for some peers. The company is required
to extend a long credit period, in keeping with the industry
standards, as its customers are small and medium-sized players with
weak credit profiles. Furthermore, to meet business requirement,
KAFPL holds moderate work-in-process and other inventory to cater
to sudden large orders.
Liquidity: Stretched
Expected cash accrual of INR2.43-2.87 crore per annum, will
sufficiently cover yearly debt obligation of INR2.05-2.20 crore
over the medium term. Bank limit remained highly utilised at around
95% over the 12 months through July 2021. Liquidity is partially
supported by unsecured loans from the promoter.
Outlook: Stable
KAFPL will continue to benefit from the extensive experience of its
promoter and healthy relationships with clients.
Rating Sensitivity Factors
Upward factors
* Sustained increase in revenue and stable operating margin leading
to cash accrual of above INR4 crore per fiscal
* Efficient working capital management
Downward factors
* Decline in profitability or revenue leading to cash accrual of
less than INR2 crore per fiscal
* Any large, debt-funded capital expenditure weakening the capital
structure.
Incorporated in 2013 and owned by Mr. Chandra Jeet Shaw, KAFPL
processes and mills non-basmati and parmal rice and produces broken
rice and rice bran at its unit in Hooghly, West Bengal.
LAKSHMI RANGA: CRISIL Keeps D Debt Ratings in Not Cooperating
-------------------------------------------------------------
CRISIL Ratings said the ratings on bank facilities of Lakshmi Ranga
Enterprises Private Limited (LREPL) continue to be 'CRISIL D Issuer
Not Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 7.75 CRISIL D (Issuer Not
Cooperating)
Term Loan 2.25 CRISIL D (Issuer Not
Cooperating)
CRISIL Ratings has been consistently following up with LREPL for
obtaining information through letters and emails dated May 10, 2022
and July 11, 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 LREPL, which restricts CRISIL
Ratings' ability to take a forward-looking view on the entity's
credit quality. CRISIL Ratings believes that rating action on LREPL
is consistent with 'Assessing Information Adequacy Risk'. Based on
the last available information, the ratings on bank facilities of
LREPL continue to be 'CRISIL D Issuer Not Cooperating'.
For arriving at the rating, CRISIL Ratings has combined the
business and financial risk profiles of LREPL and Lakshmi Traders
(LT). This is because the two entities, together referred to as the
Lakshmi group, have a common management and are engaged in similar
lines of business.
LREPL, set up in 1984, trades in paints, hardware, plywood, and
various building construction material. LT, established in 2009,
trades in white cement and other building construction material.
The group is managed by Mr. R. Anbalagan and his family members,
and based in Thiruvannamalai (Tamil Nadu).
MAA KALIKA: CRISIL Keeps D Debt Ratings in Not Cooperating
----------------------------------------------------------
CRISIL Ratings said the ratings on bank facilities of Maa Kalika
Bhandar (MKB) continue to be 'CRISIL D Issuer Not Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 7.5 CRISIL D (Issuer Not
Cooperating)
Cash Credit 15 CRISIL D (Issuer Not
Cooperating)
CRISIL Ratings has been consistently following up with MKB for
obtaining information through letters and emails dated May 10, 2022
and July 11, 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 MKB, which restricts CRISIL
Ratings' ability to take a forward-looking view on the entity's
credit quality. CRISIL Ratings believes that rating action on MKB
is consistent with 'Assessing Information Adequacy Risk'. Based on
the last available information, the ratings on bank facilities of
MKB continue to be 'CRISIL D Issuer Not Cooperating'.
For arriving at its rating, CRISIL Ratings has combined the
business and financial risk profiles of MKB, Kohenoor Industries
(KI), Shree Krushna Enterprises (SKE), and Dwarikamayee Bhandar
(DB). The firms, together referred to as the Maa Kalika group, are
under a common management with common customer and supplier base.
Moreover, the promoters treat the four entities as one single group
for funding and support.
The Maa Kalika group, promoted by the Odisha-based Jajodia family
is primarily engaged in wholesale trading in of agro items such as
sugar, pulses, and edible oil. Operations are primarily managed by
Mr. Pawan Kumar Jajodia and his son, Mr. Jay Jajodia.
MAHIP INDUSTRIES: Ind-Ra Cuts Long-Term Issuer Rating to 'D'
------------------------------------------------------------
India Ratings and Research (Ind-Ra) has downgraded Mahip Industries
Limited's Long-Term Issuer Rating to 'IND D (ISSUER NOT
COOPERATING)' from 'IND BB (ISSUER NOT COOPERATING)'.
The instrument-wise rating actions are:
-- INR170 mil. Fund-based working capital limit (long term)
downgraded with IND D (ISSUER NOT COOPERATING) rating; and
-- INR46.8 mil. Term loan due on March 31, 2022 downgraded with
IND D (ISSUER NOT COOPERATING) rating.
Note: ISSUER NOT COOPERATING: Issuer did not cooperate; based on
the best-available information
Key Rating Drivers
The downgrade reflects MIL's delays in the debt servicing of term
loans availed during December 2018 to April 2021, based on the
information from public sources. The lender has since then declared
the asset as non-performing and moved to the court for a
resolution. MIL has filed the petition against the case and the
matter is sub-judice.
Ind-Ra has not been able to ascertain the reason for the delays, as
the company has been non-cooperative.
Company Profile
MIL was incorporated in 1995 and commenced commercial operations in
1997. The company has its registered office in Ahmedabad, Gujarat.
It manufactures packaging products and services such as corrugated
boxes, carton boxes, corrugated sheets, corrugated rolls and paper
pallets at its plants in Godhneswar, Ahmedabad. The manufacturing
capacity of the company to produce printed cartons and corrugated
boxes is 35,000 metric tons per year.
MEDICON LEATHER: CRISIL Reaffirms D Rating on INR5cr Cash Loan
--------------------------------------------------------------
CRISIL Ratings has reaffirmed its rating on the bank facilities of
Medicon Leather Private Limited (MLPL) at 'CRISIL D'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 5 CRISIL D (Reaffirmed)
The rating reflects MLPL's delay in repayment of term loan, modest
scale of operation, working capital intensive operations and weak
debt protection metrics. These weaknesses are partially offset by
its extensive industry experience of the promoters.
Key Rating Drivers & Detailed Description
Weakness:
* Delays in debt servicing: There has been delay in repayment of
term loans during the last 6 months due to stretched liquidity.
* Modest scale and working capital intensive operations: MLPLs
business profile is constrained by its modest scale of operations
in the intensely competitive Leather & Leather goods industry as
reflected in its turnover of around Rs.5 crore for fiscal 2022.
MLPLs scale of operations will continue to limit its pricing
flexibility. The operations are working capital intensive as
reflected in the gross current asset days of 919 days as on March
2022. The large working capital requirements arise from its high
debtor and inventory levels of 183 days and 494 days respectively,
as on 31 March, 2022.
* Weak debt protection metrics: Financial risk profile is weak with
operating losses, thus significantly impacting debt protection
metrics.
Strengths:
* Extensive industry experience of the promoters: The promoters
have an experience of around 2 decades in leather & leather goods
industry. This has given them an understanding of the dynamics of
the market, and enabled them to establish relationships with
suppliers and customers.
Liquidity: Poor
Liquidity is poor, as reflected in delays in the repayment of
loans. The working capital limit was fully utilized during the last
12 months.
Rating Sensitivity factors
Upward factor
* 90 day track record of timely repayment of debt obligations
* Increase in revenue and operating margin
MLPL was incorporated in 1987. It is engaged into manufacturing of
leather products such as belts, bags, wallets, etc. It has
manufacturing facility locate in Bommanahalli-Bangalore. It is
promoted by Mr. Sangieve Bulchandani and Neeta Bulchandani.
MEGI AGRO CHEM: Insolvency Resolution Process Case Summary
----------------------------------------------------------
Debtor: Megi Agro Chem Limited
504, Neelambari
Thane Belapur Road
Vitava, Thane
MH 400605
IN
Insolvency Commencement Date: August 5, 2022
Court: National Company Law Tribunal, Mumbai Bench
Estimated date of closure of
insolvency resolution process: February 1, 2023
Insolvency professional: Vakati Balasubramanyam Reddy
Interim Resolution
Professional: Vakati Balasubramanyam Reddy
E-505, Galaxy
Qureshi Nagar, Kurla (East)
Mumbai 400070
E-mail: vbsreddy7@gmail.com
Mobile: 8369170484
- and -
C 1205, Galaxy
Qureshi Nagar, Kurla (East)
Mumbai 400070
E-mail: ipmegiagro@gmail.com
Last date for
submission of claims: August 19, 2022
MICRO DYNAMICS: Insolvency Resolution Process Case Summary
----------------------------------------------------------
Debtor: Micro Dynamics Private Limited
T-178 MIDC Bhosari
Pune MH 411026
IN
Insolvency Commencement Date: February 28, 2022
Court: National Company Law Tribunal, Pune Bench
Estimated date of closure of
insolvency resolution process: August 23, 2022
(180 days from commencement)
Insolvency professional: Anagha Anasingaraju
Interim Resolution
Professional: Anagha Anasingaraju
C/o Kanjmag & Co
Company Secretaries
1-2, Aishwarya Sankul
17 G.A. Kulkarni Path
Opp. Joshi's Railway Museum
Kothrud, Pune 411038
E-mail: rp.anagha@kanjcs.com
Last date for
submission of claims: March 14, 2022
NATHJI COTTON: CARE Keeps D Debt Rating in Not Cooperating
----------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Shree
Nathji Cotton & Oil Industries (SNCOI) continues to remain in the
'Issuer Not Cooperating' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Bank 7.66 CARE D; ISSUER NOT COOPERATING
Facilities Rating continues to remain
under ISSUER NOT COOPERATING
category
Detailed Rationale & Key Rating Drivers
CARE Ratings Ltd. had, vide its press release dated June 30, 2021,
placed the rating(s) of SNCOI under the 'issuer non-cooperating'
category as SNCOI had failed to provide information for monitoring
of the rating and had not paid the surveillance fees for the rating
exercise as agreed to in its Rating Agreement. SNCOI continues to
be noncooperative despite repeated requests for submission of
information through e-mails, phone calls and a letter/email dated
May 16, 2022, May 26, 2022, June 5, 2022.
In line with the extant SEBI guidelines, CARE Ratings Ltd. has
reviewed the rating on the basis of the best available information
which however, in CARE Ratings Ltd.'s opinion is not sufficient to
arrive at a fair rating.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating(s).
Morbi-based (Gujarat) SNCOI is a partnership firm and was
established in July, 2015 by Mr Kamleshbhai Likhiya Mr Girishbhai
Likhiya and Mr Bharatbhai Charola. SNCOI is engaged into cotton
ginning, cleaning and bailing process. The firm procures raw cotton
from farmers and sells its products in domestic market to the
states like Maharshtra, Tamilnadu etc.
NCL BUILDTEK: Ind-Ra Withdraws 'BB+' Term Loan Rating
-----------------------------------------------------
India Ratings and Research (Ind-Ra) has assigned NCL Buildtek & NCL
Industries JV a Long-Term Issuer Rating of 'IND BB+' while placing
it on Rating Watch Positive (RWP). The agency has simultaneously
withdrawn the rating on proposed bank facilities and unsupported
rating.
The instrument-wise rating actions are:
-- INR900 mil. Proposed fund-based working capital facility^ is
withdrawn;
-- INR586.3 mil. Proposed non-fund-based facility^ is withdrawn;
-- Unsupported rating^ is withdrawn;
-- INR200 mil. Fund-based working capital Facility assigned with
IND BB+/RWP/IND A4+/RWP rating;
-- INR286.3 mil. Non-fund-based facility assigned with IND A4+/
RWP rating.
^The ratings have been withdrawn due to a change in the financial
structure of the transaction. The partners have not extended a
pre-default corporate guarantee since there is a reduction in the
requirements of bank facilities in NCL JV.
Analytical Approach: Ind-Ra has followed a top-down rating approach
using the Parent and Subsidiary Rating Linkage Criteria for
arriving at the ratings of NCL JV. NCL JV was formed by NCL
Buidltek Ltd (NCL) and NCL Industries Ltd (NCL IL) in FY22 in a
profit sharing ratio of 50:50 with NCL being the lead partner. NCL
JV has strong operational, legal and strategic linkages with NCL.
The ratings have been placed on RWP on account of NCL's proposed
sale of its stake in its associate company NCL Veka Limited which
is likely to be completed by November 2022. RWP reflects the
expected improvement NCL's financial and liquidity profile based on
the completion of this transaction.
Key Rating Drivers
The ratings reflect NCL JV's lower-than-expected revenue of INR86.2
million in FY22, the first year operations. This was mainly on
account of a change in the scope of work assigned to the JV,
resulting in smaller quantities of orders received. Considering the
delays in the handover of the required land to beneficiaries and
smaller quantities of orders received so far, Ind-Ra expects the JV
to generate revenue in the range of INR1,000 million-1,700 million
in FY23. The agency also expects project completion time to get
extended, resulting in revenue generation from this project to
spread over until FY25. The total contract value is INR18,632
million, comprising 75% for the windows segment and the remaining
25% for door frames.
The EBITDA margin of the JV remained modest at 7.5% in FY22. The
major raw material is steel and the cost of materials consumed
constitutes around 66% of the total sales. The operating
profitability is susceptible to volatility in raw material prices
as the JV is implementing the project under a fixed-price contract
for a period of 12 months. However, as informed by the management,
5% has already been provided to meet any contingency. The return on
capital employed was 4%. FY22 financials are provisional in nature.
The ratings continue to reflect the project and geographic
concentration risk as NCL JV generates revenue through the sole
customer – the government of Andhra Pradesh under the Navaratnalu
- Pedalandariki Illu scheme.
The ratings factor in the JV's reduced working capital requirements
and the resultant reduction in the sanctioned limits from the
proposed limits on account of the smaller quantities of orders
received. As per the management, the working capital requirements
will be managed with available limits and the JV is able to recover
the receivables on time. As per Ind-Ra's estimation, the net cash
conversion cycle of the company likely to be in the range of 80-87
days over the medium term (FY22: not applicable). The working
capital limits were sanctioned in June 2022 and the maximum
utilization was INR17.6 million as against the sanctioned limit of
INR200 million. The working capital utilization is likely to
increase based on the increase in the flow of orders and execution
of the same.
Liquidity Indicator – Stretched: The liquidity indicator remains
stretched based on reliance on a single banker and no access to
capital markets. The cash flow from operations remained negative of
INR317.6 million in FY22. The JV does not have any term loan
repayments. The cash and cash equivalents as of FY22 amounted to
INR9.42 million.
The ratings factor in the strong legal, strategic and operational
linkages between NCL JV and NCL and the strong legal, strategic and
moderate operational ties between NCL JV and NCL IL. There is no
corporate guarantee extended by the corporate partners; however, an
undertaking has been extended by them to infuse funds if the JV's
cash flows are not sufficient to meet its debt obligations. So far,
the partners have infused INR160 million towards the capex for roll
forming and fabrication process and working capital margin. The JV
in FY22 incurred capex of INR22.2 million, and no further capex is
likely to be incurred over the medium term. The manufacturing
process of window and door frames is primarily labor oriented and
around 60% of the roll forming process and 25%-30% of the
fabrication process will be met through the idle capacity of NCL on
job-work basis and the remaining through JV. Given the strategic
importance, Ind-Ra expects NCL and NCL IL to provide timely support
to the JV in the event of any financial distress. NCL JV and the JV
partners have a common treasury team and common directors, and also
raw materials are sourced from NCL suppliers.
The ratings also factor in the strong market position of NCL JV
partners in the industry. NCL is an established brand in the
building material industry in southern India with an experience of
around three decades, supported by its longstanding relationships
with customer and suppliers. NCL IL has an experience of over three
decades in the cement manufacturing industry.
Consolidated Profile: On a consolidated basis, the EBITDA margin
likely to be improved in FY23 mainly on account of an improvement
in NCL's EBITDA margin, as the company now would be able to pass on
increases in raw material prices to its end-customers, while adding
high-margin products in the product portfolio and securing a higher
number of orders for the high-margin aluminum windows. In addition,
NCL benefits from better pricing from its steel suppliers due to
the high volumes required on account Andhra Pradesh Housing
Contracts and stable margins from the JV. The consolidated debt
position is likely to be increased in FY23 on account of an
enhancement of working capital limits under NCL and sanctioning of
new working capital loan under the JV. Despite the increase in the
total debt levels, the consolidated credit metrics could improve
over the medium term, backed by an increase in the absolute EBITDA
resulting from an increase in the sales from NCL and NCL JV.
Ind-Ra expects the revenue growth momentum to continue over the
medium term in NCL, backed by the receipt of continuous orders from
the existing as well as new customers. Resumption of the execution
of APTIDCO project, which was halted for the past two years, and
increased orders for aluminum windows along with increased demand
from the real estate sector will also aid the continuous revenue
growth in FY23.
Rating Sensitivities
Positive: A rating upgrade for NCL and strengthening of the
linkages between NCL and NCL JV would be positive for the ratings.
Negative: Any adverse change in the rating of NCL and weakening of
the linkages would be negative for the ratings.
Company Profile
NCL JV is a 50:50 JV incorporated in June 2021 by NCL and NCL IL to
supply windows and door frames under the flagship program
Navaratnalu - Pedalandariki Illu scheme of the government of Andhra
Pradesh.
NEUEON TOWERS: CARE Keeps D Debt Ratings in Not Cooperating
-----------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Neueon
Towers Limited (NTL) continues to remain in the 'Issuer Not
Cooperating' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Bank 1,420.24 CARE D; ISSUER NOT COOPERATING
Facilities Rating continues to remain
under ISSUER NOT COOPERATING
category
Short Term Bank 200.02 CARE D; ISSUER NOT COOPERATING
Facilities Rating continues to remain
under ISSUER NOT COOPERATING
category
Detailed rationale and key rating drivers
CARE had, vide its press release dated August 6, 2021 placed the
rating(s) of NTL under the 'issuer non-cooperating' category as NTL
had failed to provide information for monitoring of the rating. NTL
continues to be noncooperative despite repeated requests for
submission of information through e-mails, phone calls and an email
dated July 6, 2022, July 08, 2022 and July 21, 2022.
In line with the extant SEBI guidelines, CARE has reviewed the
rating based on the best available information which however, in
CARE's opinion is not sufficient to arrive at a fair rating.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating(s).
Detailed description of the key rating drivers
At the time of last rating on August 6, 2021 the following were the
rating strengths and weaknesses:
Key Rating Weaknesses
* Stretched liquidity position with ongoing delays in debt
servicing: Stretched liquidity position along with delays in
meeting the debt obligation and the accounts are classified are
Non-Performing Assets and the company is currently under resolution
process.
Neueon Towers Limited (erstwhile Sujana Towers Limited) was
established in April 2006 after demerger of Towers Division of
Splendid Metal Products Limited (erstwhile Sujana Metal Products
Limited), pursuant to the scheme of arrangement and amalgamation as
approved by the High Court Andhra Pradesh. Neueon Towers Limited
(NTL) is engaged in manufacturing of galvanized steel towers used
in the power transmission and telecom tower sector. NTL was
initially a part of the Sujana group, promoted by Y.S. Chowdhary
who has more than 23 years of experience in steel products
manufacturing and trading. The group has diversified business
activity with presence in construction & structural steel, power
transmission & telecom towers and allied services, energy
(generation, distribution, green energy consulting and manufacture
of energy saving LEDs), basic and urban infrastructure development,
precision engineering components, domestic appliances and
international trade.
NITYA REALTECH: Insolvency Resolution Process Case Summary
----------------------------------------------------------
Debtor: Nitya Realtech Private Limited
220, Opposite Veternity Hospital
Village Burari, Delhi 110084
India
Insolvency Commencement Date: August 9, 2022
Court: National Company Law Tribunal, New Delhi Bench IV
Estimated date of closure of
insolvency resolution process: February 1, 2023
(180 days from commencement)
Insolvency professional: Sanyam Goel
Interim Resolution
Professional: Sanyam Goel
Unit No. 110, First Floor
JMD Pacific Square, Sector 15
Part II, Gurugram 122001
Haryana, India
E-mail: goelsanyam@gmail.com
cirp.nityarealtech@gmail.com
Classes of creditors: Real Estate Project
Insolvency
Professionals
Representative of
Creditors in a class: Mr. Aishwarya Mohan Gahrana
4, Birbal Marg, 2nd Floor
Jangpura Extension
New Delhi 110014
E-mail: aishwaryam_gahrana@yahoo.com
Mr. Vikky Dang
B-11, Near Mangal Bazar
Gurudwara, Vishnu Garden
New Delhi 110018
E-mail: vikkydang@gmail.com
Mr. Pramod Kumar Gupta
B-1/10, Lower Ground Floor
Hauz Khas, Delhi 110016
E-mail: variety.financial@gmail.com
Last date for
submission of claims: August 23, 2022
NIZAM DECCAN: CRISIL Keeps D Debt Ratings in Not Cooperating
------------------------------------------------------------
CRISIL Ratings said the ratings on bank facilities of Nizam Deccan
Sugars Limited (NDSL) continue to be 'CRISIL D/CRISIL D Issuer Not
Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 50.7 CRISIL D (Issuer Not
Cooperating)
Cash Credit 24.6 CRISIL D (Issuer Not
Cooperating)
Cash Credit 19 CRISIL D (Issuer Not
Cooperating)
Cash Credit 9 CRISIL D (Issuer Not
Cooperating)
Letter of credit 0.5 CRISIL D (Issuer Not
& Bank Guarantee Cooperating)
Proposed Long Term 48.09 CRISIL D (Issuer Not
Bank Loan Facility Cooperating)
Term Loan 16.14 CRISIL D (Issuer Not
Cooperating)
Term Loan 17.2 CRISIL D (Issuer Not
Cooperating)
CRISIL Ratings has been consistently following up with NDSL for
obtaining information through letters and emails dated May 10, 2022
and July 11, 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 NDSL, which restricts CRISIL
Ratings' ability to take a forward-looking view on the entity's
credit quality. CRISIL Ratings believes that rating action on NDSL
is consistent with 'Assessing Information Adequacy Risk'. Based on
the last available information, the ratings on bank facilities of
NDSL continue to be 'CRISIL D/CRISIL D Issuer Not Cooperating'.
NDSL, incorporated in 2002, manufactures sugar and extra neutral
alcohol, and generates power. NDSL has three sugar plants in
Telangana. The company also has a distillery unit, and a
20-megawatt biomass-based power generation plant. Dr. G Ganga Raju
and family (promoters of the Laila group of companies) hold a 51
per cent stake in NDSL; the balance 49 per cent stake is held by
Nizam Sugars Ltd. The Laila group is engaged in diverse businesses
including sugar, paper, nutraceuticals, and education.
PODDAR CAR: Ind-Ra Moves BB+ Issuer Rating to Non-Cooperating
-------------------------------------------------------------
India Ratings and Research (Ind-Ra) has migrated Poddar Car World
Private Limited's Long-Term Issuer Rating to the non-cooperating
category. The issuer did not participate in the 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 surveillance COOPERATING)' on the agency's website.
The instrument-wise rating actions are:
-- INR831.5 mil. Fund-based limits migrated to non-cooperating
category with IND BB+ (ISSUER NOT COOPERATING)/IND A4+
(ISSUER NOT COOPERATING) rating; and
-- INR5 mil. Non-fund-based limits migrated to non-cooperating
category with IND A4+ (ISSUER NOT COOPERATING) rating.
Note: ISSUER NOT COOPERATING: The ratings were last reviewed on
July 8, 2021. Ind-Ra is unable to provide an update, as the agency
does not have adequate information to review the ratings.
Company Profile
Poddar Car World has 3S (sales, service and spares) showrooms
located in Assam and West Bengal for cars manufactured by Maruti
Suzuki India Limited. In addition, it deals in pre-owned car sales
and provides facility for exchanging used cars through Maruti True
Value.
PRIME INFRAPARK: Insolvency Resolution Process Case Summary
-----------------------------------------------------------
Debtor: Prime Infrapark Private Limited
Registered office:
B-85, 1st Floor, Defence Colony
South Delhi, New Delhi 110024
Corporate office:
Universal Majestic, 14th Floor
PL Lokhande Marg
Govandi-W. Mumbai 400043
Insolvency Commencement Date: August 12, 2022
Court: National Company Law Tribunal, Bench III, New Delhi
Estimated date of closure of
insolvency resolution process: February 8, 2023
(180 days from commencement)
Insolvency professional: Santanu Kumar Samanta
Interim Resolution
Professional: Santanu Kumar Samanta
C-170 Golf View Apartments
Saket South
National Capital Territory of Delhi
110017
E-mail: santanukumar@yahoo.com
- and -
Immaculate Resolution Professionals
Private Limited
Unit No. 112, First Floor, Tower-A
Spazedge Commercial Complex
Sector-47, Sohna Road
Gurgaon 122018
E-mail: cirp.prime@gmail.com
Last date for
submission of claims: August 26, 2022
PROVIEW INFRASTRUCTURE: Insolvency Resolution Process Case Summary
------------------------------------------------------------------
Debtor: Proview Infrastructure Private Limited
220, Opposite Veternity Hospital
Village Burari, Delhi
North Delhi 110084
India
Insolvency Commencement Date: August 9, 2022
Court: National Company Law Tribunal, New Delhi Bench IV
Estimated date of closure of
insolvency resolution process: February 1, 2023
(180 days from commencement)
Insolvency professional: Sanyam Goel
Interim Resolution
Professional: Sanyam Goel
Unit No. 110, First Floor
JMD Pacific Square, Sector 15
Part II, Gurugram 122001
Haryana, India
E-mail: goelsanyam@gmail.com
cirp.proviewinfrastructure@
gmail.com
Classes of creditors: Real Estate Project
Insolvency
Professionals
Representative of
Creditors in a class: Mr. Aishwarya Mohan Gahrana
4, Birbal Marg, 2nd Floor
Jangpura Extension
New Delhi 110014
E-mail: aishwaryam_gahrana@yahoo.com
Mr. Vikky Dang
B-11, Near Mangal Bazar
Gurudwara, Vishnu Garden
New Delhi 110018
E-mail: vikkydang@gmail.com
Mr. Pramod Kumar Gupta
B-1/10, Lower Ground Floor
Hauz Khas, Delhi 110016
E-mail: variety.financial@gmail.com
Last date for
submission of claims: August 23, 2022
RICH FRUITS: Liquidation Process Case Summary
---------------------------------------------
Debtor: Rich Fruits Private Limited
Unit: F1 & F2, No. 41
Mosque Complex, MM Road
Fraser Town Bangalore
KA 560005
Liquidation Commencement Date: August 11, 2022
Court: National Company Law Tribunal, Bengaluru Bench
Date of closure of
insolvency resolution process: July 28, 2022
Insolvency professional: Hari Babu Thota
Interim Resolution
Professional: Hari Babu Thota
#41/1, 2nd Floor, A Wing
11th Cross, 8th Main 2nd Block
Jayanagar, Bangalore
Karnataka 560011
E-mail: csharibabuthota@gmail.com
richfruitsip@gmail.com
Last date for
submission of claims: August 27, 2022
SATHWIK EXPORTS: CARE Keeps C Debt Rating in Not Cooperating
------------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Sathwik
Exports (SE) continues to remain in the 'Issuer Not Cooperating'
category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Bank 5.50 CARE C; ISSUER NOT COOPERATING
Facilities Rating continues to remain
under ISSUER NOT COOPERATING
category
Detailed Rationale & Key Rating Drivers
CARE Ratings Ltd. had, vide its press release dated June 22, 2021,
placed the rating(s) of SE under the 'issuer non-cooperating'
category as SE had failed to provide information for monitoring of
the rating and had not paid the surveillance fees for the rating
exercise as agreed to in its Rating Agreement. SE continues to be
non-cooperative despite repeated requests for submission of
information through e-mails, phone calls and a letter/email dated
May 8, 2022, May 18, 2022, May 28, 2022.
In line with the extant SEBI guidelines, CARE Ratings Ltd. has
reviewed the rating on the basis of the best available information
which however, in CARE Ratings Ltd.'s opinion is not sufficient to
arrive at a fair rating.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating(s).
Karnataka based, Sathwik Exports (SE) was established in 2003 as a
partnership firm by Mr. Janardhana Nayak and his family members. SE
is engaged in the manufacturing of Desiccated Coconut Powder. The
firm purchases Coconut from the farmers located in and around
Karnataka. The firm sells its final products to the customers
located in Madhya Pradesh, Uttar Pradesh, Delhi and Gujarat. The
current installed capacity for the manufacturing of Desiccated
Coconut Powder is 80,000 units per month. The firm generates 85 per
cent of the revenue by manufacturing and export of Desiccated
Coconut Powder and the remaining 15 per cent of the revenue by
selling its by products such as Coconut Chips, Husks and Coconut
Shells respectively.
SHAH HOUSECON: Insolvency Resolution Process Case Summary
---------------------------------------------------------
Debtor: Shah Housecon Private Limited
Office No. 1 & 2, 8th Floor
Shah Trade Centre
Rani Sati Marg, Malad (East)
Mumbai 400097
Insolvency Commencement Date: August 8, 2022
Court: National Company Law Tribunal, Mumbai Bench
Estimated date of closure of
insolvency resolution process: January 14, 2023
(180 days from commencement)
Insolvency professional: Mr. Kunal Jayant Waje
Interim Resolution
Professional: Mr. Kunal Jayant Waje
Plot no. 26, Snehal Bunglow
Gokulwadi, Shrirang Nagar
Gangapur Road
Near Rathi-Amrai
Nashik, Maharashtra
E-mail: shplmum2022@gmail.com
Classes of creditors: Home Buyers
Insolvency
Professionals
Representative of
Creditors in a class: Anish Gupta
Vaishali Arun Patrikar
Dipti Amit Thite
Last date for
submission of claims: August 21, 2022
SNAP FINSERV: Voluntary Liquidation Process Case Summary
--------------------------------------------------------
Debtor: SNAP Finserv Private Limited
House No. 17, Basement Floor
BLK-F-11, Model Town
Delhi 110009
Liquidation Commencement Date: August 4, 2022
Court: National Company Law Tribunal, Delhi Bench
Insolvency professional: Lekhraj Bajaj
Interim Resolution
Professional: Lekhraj Bajaj
107, Agarwal Prestige Mall
Adjoining to M2K, Pitampura
New Delhi 110034
E-mail: lekhrajbajaj@rediffmail.com
Tel: 9810109335
Last date for
submission of claims: September 3, 2022
SNH CONSTRUCTION: Insolvency Resolution Process Case Summary
------------------------------------------------------------
Debtor: M/s SNH Construction Private Limited
Business Suit No. 19, Sector-48
INHWA Business Centre, Ground Floor
Iris Tech Park, Tower A
Gurgaon 122018
Insolvency Commencement Date: August 10, 2022
Court: National Company Law Tribunal, Chandigarh Bench
Estimated date of closure of
insolvency resolution process: February 6, 2023
Insolvency professional: Mr. Harsh Garg
Interim Resolution
Professional: Mr. Harsh Garg
Room No. 14, Punjab & Haryana High Court
Chandigarh 160001
E-mail: harsh.garg81@gmail.com
- and –
H.No. 170, Sector 21-A
Chandigarh 160022
E-mail: ip.snhconstruction@gmail.com
Last date for
submission of claims: August 24, 2022
SNS LABORATORIES: Insolvency Resolution Process Case Summary
------------------------------------------------------------
Debtor: SNS Laboratories Limited
Office No. 322, 3rd Floor
S.S. Plaza Commercial Complex
Mayfield Garden, Sector 47
Gurgaon 122001
Haryana
Insolvency Commencement Date: August 11, 2022
Court: National Company Law Tribunal, Chandigarh Bench
Estimated date of closure of
insolvency resolution process: February 7, 2023
(180 days from commencement)
Insolvency professional: Mohd Nazim Khan
Interim Resolution
Professional: Mohd Nazim Khan
MNK House
9A/9-10, Basement
East Patel Nagar
New Delhi 110008
India
E-mail: nazim@mnkassociates.com
cirp.snslaboratories@gmail.com
Last date for
submission of claims: August 25, 2022
SPLENDID METAL: CARE Keeps D Debt Ratings in Not Cooperating
------------------------------------------------------------
CARE Ratings said the rating for the bank facilities of Splendid
Metal Products Limited (SMPL) continues to remain in the 'Issuer
Not Cooperating' category.
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Bank 1,701.84 CARE D; ISSUER NOT COOPERATING
Facilities Rating continues to remain
under ISSUER NOT COOPERATING
category
Short Term Bank 269.13 CARE D; ISSUER NOT COOPERATING
Facilities Rating continues to remain
under ISSUER NOT COOPERATING
category
Detailed rationale and key rating drivers
CARE had, vide its press release dated August 6, 2021 placed the
rating(s) of SMPL under the 'issuer non-cooperating' category as
SMPL had failed to provide information for monitoring of the
rating. SMPL continues to be non-cooperative despite repeated
requests for submission of information through e-mails, phone calls
and an email dated July 6, 2022, July 8, 2022 and July 25, 2022.
In line with the extant SEBI guidelines, CARE has reviewed the
rating based on the best available information which however, in
CARE's opinion is not sufficient to arrive at a fair rating.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating(s).
Detailed description of the key rating drivers
At the time of last rating on August 6, 2021 the following were the
rating strengths and weaknesses:
Key Rating Weaknesses
* Stretched liquidity position with ongoing delays in debt
servicing: Stretched liquidity position along with delays in
meeting the debt obligation and the accounts are classified are
Non-Performing Assets and the company is currently under resolution
process.
Splendid Metal Products Limited (Erstwhile Sujana Metal Products
Limited), belongs to Hyderabad based Sujana Group. SMPL was
incorporated in May 1988 under the name of Sujana Steel Re-Rolling
Industries (P) Limited. The name of the company was later changed
to Sujana Steels Private Limited in March 1992 and got converted
into public limited company in April 1992. SMPL is engaged in
trading of steel products and manufacturing of TMT bars &
structural steel products at its facilities located at Hyderabad,
Chennai and Vizag. Sujana group, belonging to Y. S. Chowdhary, is a
South India based industrial house having about two decades of
experience in the steel industry. The group is involved in
manufacturing of Thermo Mechanical Treated (TMT) bars, Structural
Steels, Galvanised Steel towers (used in power transmission &
telecom sector) and steel trading through its companies; Sujana
Universal Industries Ltd, Sujana Towers Ltd. etc.
TERRA REALCON: CRISIL Keeps D Debt Rating in Not Cooperating
------------------------------------------------------------
CRISIL Ratings said the rating on bank facilities of Terra Realcon
Private Limited (TRPL) continues to be 'CRISIL D Issuer Not
Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Term Loan 10 CRISIL D (Issuer Not
Cooperating)
CRISIL Ratings has been consistently following up with TRPL for
obtaining information through letters and emails dated May 10, 2022
and July 11, 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 TRPL, which restricts CRISIL
Ratings' ability to take a forward-looking view on the entity's
credit quality. CRISIL Ratings believes that rating action on TRPL
is consistent with 'Assessing Information Adequacy Risk'. Based on
the last available information, the ratings on bank facilities of
TRPL continue to be 'CRISIL D Issuer Not Cooperating'.
Incorporated in 2007 and promoted by Mr. Mahender Arora and Mr.
Sunil Chutani, TRPL develops real estate and is currently
constructing a residential project, Terra Castle, in Bhiwadi,
Rajasthan.
TOPWORTH URJA: Insolvency Resolution Process Case Summary
---------------------------------------------------------
Debtor: Topworth Urja & Metals Limited
308, 3rd Floor Ceejay House
Dr. A.B. Road, Worli
Mumbai 400018, Maharashtra
Insolvency Commencement Date: August 12, 2022
Court: National Company Law Tribunal, Mumbai Bench
Estimated date of closure of
insolvency resolution process: February 8, 2023
(180 days from commencement)
Insolvency professional: Alok Kailash Saksena
Interim Resolution
Professional: Alok Kailash Saksena
1st Floor, Laxmi Building
Sir P M Road
Fort, Mumbai
Maharashtra 400001
E-mail: aks@dsaca.co.in
cirp.urja@gmail.com
Last date for
submission of claims: August 26, 2022
TOPWORTH URJA: NCLT Admits Firm Under Insolvency Process
--------------------------------------------------------
The Economic Times reports that the National Company Law Tribunal
(NCLT) has admitted Mumbai-based Topworth Urja & Metals Ltd under
the Corporate Insolvency Resolution Process (CIRP) and appointed
Alok Kailash Saksena as an interim resolution professional for the
company.
ET relates that state-owned lender Bank of Baroda had approached
the bankruptcy court in 2018 against Abhay Lodha-promoted Topworth
Urja & Metals after it defaulted on its dues of about INR218
crore.
"The application made by the financial creditor is complete in all
respects as required by law. It clearly shows that the corporate
debtor is in default of a debt due and payable, and the default is
in excess of the minimum amount stipulated under the IBC
(Insolvency and Bankruptcy Code)," a bench of justices PN Deshmukh
and Shyam Babu Gautam said in its 23-page order, ET relays.
In its August 12 order, the tribunal said, "Therefore, the debt and
default stands established and there is no reason to deny the
admission of the petition. In view of this, this tribunal admits
this petition and orders initiation of CIRP against the corporate
debtor (Topworth Urja)," according to ET.
ET says Bank of Baroda had argued that it had granted certain term
loans and working capital facilities to Topworth Urja & Metals from
time to time, which were restructured on the terms and conditions
set out under the sanction letter of March 27, 2015.
While opposing this plea for admission, the company argued that the
application was filed on the basis of an incorrect date of default.
The company also argued that the alleged amount claimed by the
lender was not due and payable. It said the application was
defective and also barred by limitation.
In March, the country's largest, lender State Bank of India (SBI),
lined up about a dozen non-performing assets (NPAs) on sale to
recover loan dues of about INR820 crore. The list included Topworth
Urja & Metals, with a loan outstanding of INR396.74 crore.
Mumbai-based Topworth Group's other affiliate firm, Topworth Steel
& Power Pvt Ltd, is also undergoing an insolvency process, the
report notes. On Feb. 29, 2020, the tribunal admitted the company
on a plea filed by the SBI. The lender had approached the tribunal
after the company defaulted on its dues of about INR835 crore. The
company has admitted financial claims of more than INR2,845 crore.
TRIMURTI CORNS: CRISIL Keeps D Debt Ratings in Not Cooperating
--------------------------------------------------------------
CRISIL Ratings said the ratings on bank facilities of Trimurti
Corns Agro Foods Private Limited (TCAFPL) continue to be 'CRISIL D
Issuer Not Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 2.5 CRISIL D (Issuer Not
Cooperating)
Export Packing 2 CRISIL D (Issuer Not
Credit Cooperating)
Long Term Loan 4.62 CRISIL D (Issuer Not
Cooperating)
Long Term Loan 12.35 CRISIL D (Issuer Not
Cooperating)
CRISIL Ratings has been consistently following up with TCAFPL for
obtaining information through letters and emails dated May 10, 2022
and July 11, 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 TCAFPL, which restricts CRISIL
Ratings' ability to take a forward-looking view on the entity's
credit quality. CRISIL Ratings believes that rating action on
TCAFPL is consistent with 'Assessing Information Adequacy Risk'.
Based on the last available information, the ratings on bank
facilities of TCAFPL continue to be 'CRISIL D Issuer Not
Cooperating'.
For arriving at the rating, CRISIL Ratings has combined the
business and the financial risk profile of TCAFPL and Mrunmaha Agro
Foods Pvt Ltd (MAFPL). This is because these two companies,
together referred as the Trimurti group, are under a common
management, are engaged in a similar line of business, and have
operational and financial linkages. Furthermore, both these
companies have given corporate guarantees for each other's bank
facilities.
The Trimurti group processes agro-commodities such as sweet corn,
baby corn, and green peas, and manufactures frozen, non-frozen, and
ready-to-eat products. TCAFPL and MAFPL have a combined processing
capacity of 183 tonnes per day (tpd) at their manufacturing units
in Pune (Maharashtra).
VARDHMAN ROLLER: CARE Lowers Rating on INR31.90cr LT Loan to C
--------------------------------------------------------------
CARE Ratings has revised the ratings on certain bank facilities of
Vardhman Roller Flour Mills Private Limited (VRFMPL), as:
Amount
Facilities (INR crore) Ratings
---------- ----------- -------
Long Term Bank 31.90 CARE C; Stable; ISSUER NOT
Facilities COOPERATING; Rating continues
To remain under ISSUER NOT
COOPERATING category and
Revised from CARE B-; Stable
Detailed Rationale & Key Rating Drivers
CARE Ratings Ltd. had, vide its press release dated June 17, 2021,
placed the rating(s) of VRFMPL under the 'issuer non-cooperating'
category as VRFMPL had failed to provide information for monitoring
of the rating and had not paid the surveillance fees for the rating
exercise as agreed to in its Rating Agreement. VRFMPL continues to
be non-cooperative despite repeated requests for submission of
information through e-mails, phone calls and a letter/email dated
May 3, 2022, May 13, 2022, May 23, 2022.
In line with the extant SEBI guidelines, CARE Ratings Ltd. has
reviewed the rating on the basis of the best available information
which however, in CARE Ratings Ltd.'s opinion is not sufficient to
arrive at a fair rating.
Users of this rating (including investors, lenders and the public
at large) are hence requested to exercise caution while using the
above rating(s).
The ratings assigned to the bank facilities of VRFMPL have been
revised on account of non-availability of requisite information.
The ratings also consider decline in scale of operations as well as
increase in net loss during FY21 compared to FY20.
Vardhman Roller Flour Mills Private Limited (VRFMPL), originally
promoted by Mr. Ashok Kumar Jain was incorporated on Feb. 27, 1997.
Later on Mr. Rajesh Kumar Jain on March 3, 1997 & Mr. Manoj Kumar
Gupta on March 16, 2010 respectively were appointed as other
Directors of company. The company is engaged in manufacturing of
maida, suji, atta & bran and sells with branded name "Double
Kalash". It has two manufacturing facilities with one located at
Mohkampur Industrial Area and other at Faridpur, Bareilly.
VASAVI AGRO: CRISIL Keeps D Debt Ratings in Not Cooperating
-----------------------------------------------------------
CRISIL Ratings said the ratings on bank facilities of Sri Vasavi
Agro Foods (SVAF) continue to be 'CRISIL D Issuer Not
Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Cash Credit 19 CRISIL D (Issuer Not
Cooperating)
Long Term Loan 2 CRISIL D (Issuer Not
Cooperating)
CRISIL Ratings has been consistently following up with SVAF for
obtaining information through letters and emails dated May 10, 2022
and July 11, 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 SVAF, which restricts CRISIL
Ratings' ability to take a forward-looking view on the entity's
credit quality. CRISIL Ratings believes that rating action on SVAF
is consistent with 'Assessing Information Adequacy Risk'. Based on
the last available information, the ratings on bank facilities of
SVAF continue to be 'CRISIL D Issuer Not Cooperating'.
Set up in fiscal 2013 as a partnership firm, SVAF processes paddy
into rice, rice bran, broken rice, and husk; it commenced
commercial production in December 2013. The rice mill is located at
Karatagi in Koppal (Karnataka). The operations are managed by the
chief partner Mr. Y Vasudev Shetty.
VEL TECH: Ind-Ra Assigns BB+ Bank Loan Rating
---------------------------------------------
India Ratings and Research (Ind-Ra) has rated Vel Tech Rangarajan
Dr. Sagunthala R&D Institute of Science and Technology Trust's
(VTRS) following bank facilities:
-- INR245.00 mil. Fund-based working capital limits assigned with
IND BB+/Stable rating;
-- INR440.31 mil. Bank loans assigned with IND BB+/Stable rating;
and
-- INR214.69 mil. Proposed bank loans assigned with IND BB+/
Stable rating.
Key Rating Drivers
Liquidity Indicator – Stretched: Although trust's cash and
balance remained moderate at above INR148 million during FY17-FY22,
it did not provide adequate cover to the total debt and operating
expenditure. The unencumbered cash and balance rose 70.76% yoy to
INR253.81 million in FY22, due to a 305.53% yoy increase in the net
surplus to INR463.34 million, however covered just 31.46% (FY21:
10.55%) of the total debt and 26.46% (14.86%) of the total
operating expenditures. The collection days fell to 50 days for
FY22 declined from 81 days in FY21 on the back of an improvement in
fee collections. The trust has availed INR245 million of working
capital facilities from banks and utilization was within the
sanctioned limits during the 12 months ended June 2022. Moreover,
it maintained a credit balance in the working capital facilities
for most of the time during the 12 months ended June 2022. However,
there were delays in debt servicing during May 2021, June 2021,
December 2021 and January 2022 due to stretched working capital
with high utilization of limits and absence of auto-debit system.
Enabling auto-debit system and timely debt servicing track record
would be positive for the ratings. The figures for FY22 are
provisional in nature.
The trust's debt service commitments stood at INR291.01 million
(17.23% of the total income) in FY22 (FY21: INR465.64 million;
32.52%), and it is likely to amount to INR299.38 million (117.95%
of unencumbered cash and balance outstanding at FYE22) in FY23.
Ind-Ra expects the liquidity profile to improve over the medium
term, due to the absence of any major capex plan and maintenance of
operating profitability.
Modest Operating Profitability: The trust's operating profitability
rose steadily during FY19-FY22 owing to the higher yoy growth in
the operating income than the operating expenditure. The operating
margin increased to 42.28% in FY22 from 29.21% in FY21, mainly due
to a 17.62% yoy increase in the operating income to INR1,661.74
million. The EBITDA margin increased to 43.22% in FY22 from 30.15%
in FY21. Ind-Ra expects the operating margin to remain modest above
30% for FY23-FY24 on account of sustained revenue growth.
Moderate Revenue Base: The trust's revenue base grew steadily at a
CAGR of 13.54% to INR1,689.21 million during FY17-FY22 owing to
steady growth in its student headcount. Tuition fee was the major
source of revenue, which accounted 71.59% averagely of the total
income and increased at a CAGR of 9.86% during FY17-FY22. Hostel
receipts was the second major source of revenue, which accounted
25.58% averagely of the total income and increased at a CAGR of
23.58% during FY17-FY22. The total revenue had declined 35.12% yoy
to INR1,431.77 million in FY21 due to a 14.84% yoy fall in the
tuition fee to INR1,313.48 million, due to netting off of
scholarship of expenses against tuition fee, while the hostel fee
receipts also declined 85.90% yoy to INR89.04 million, due to the
COVID-19-led lockdown as the classes were conducted through online.
As the lockdown was lifted and the institutions started conducting
physical classes during FY22, the hostel fee receipts increased to
INR608.48 million and consequently, the total revenue increased
17.98% yoy to INR1,689.21 million during the year. Ind-Ra expects
the revenue to grow gradually over the medium term on account of
expected growth in student headcount.
Reduced Debt Burden and Improvement in Coverage: The trust's debt
burden (debt/EBITDA) was high during FY17-FY21, due to its
debt-funded capex plan. However, the deb/EBITDA decreased to 1.10x
in FY22 (FY21: 3.26x) mainly due to a 42.72% yoy fall in total debt
to INR806.66 million. Moreover, the EBITDA increased by 69.11% yoy
to INR730.02 million in FY22. The debt service coverage ratio
improved to 2.51x in FY22 (FY21: 0.93x) due to the increased EBITDA
and a 37.50% yoy reduction in the debt service commitments to
INR291.01 million. Also, the interest service coverage ratio
improved to 9.50x in FY22 (FY21: 3.64x). Ind-Ra expects the debt
burden and coverage metrics to remain comfortable over the medium
term.
Increasing Headcount: The trust reported steady growth in its
student headcount during FY16-FY22 by adding a minimum of 451
students every year. The student headcount increased at a CAGR of
19.58% to 10,345 during FY16-FY22 owing to constant growth in
enrolments for engineering courses. In FY22, the student headcount
increased 4.56% yoy to 10,345, mainly due to increased enrolment
for arts courses. Students in engineering course proportioned 81%
of the total student's headcount in FY22. The capacity utilization
increased to 89% in FY22 from 85% in FY21. Ind-Ra expects the
student headcount to grow gradually over the medium term on account
of the availability of infrastructure.
Experienced Promoters and Continued Financial Support: The trust
benefits from the group brand name Vel Tech and long operational
track record of more than 25 years. Furthermore, the trust receives
strong financial support from the trustee's and group entities in
the form of unsecured loans stood at INR200.01 million as on FYE22.
The trust-run institution secured 84th rank in the engineering
category, 147th rank in the university category and 197th rank in
the overall category of NIRF for 2022.
Rating Sensitivities
Positive: A sustained improvement in the cash flow from operation,
and the debt service coverage ratio sustaining above 1.5x coupled
with timely debt servicing could lead to a positive rating action.
Negative: Inability to maintain the operating profitability which
could lead to deterioration in debt and coverage metrics and stress
on the liquidity position will be negative for the ratings.
Company Profile
Established in 1997, VTRS is promoted by Dr. R Rangarajan (Founder
and Chairman) who is also the founder of Vel Group, which also
manages Vel Trust (1997) (debt rated at 'IND BB'/Stable) and R.S.
Trust (debt rated at 'IND BB'/Stable), along with VTRS. VTRS is a
private university which offers various undergraduate and
postgraduate courses in engineering, management, law and media
technology & communication.
YANTRA GREEN: CRISIL Keeps D Debt Rating in Not Cooperating
-----------------------------------------------------------
CRISIL Ratings said the rating on bank facilities of Yantra Green
Power Private Limited (YGP) continues to be 'CRISIL D Issuer Not
Cooperating'.
Amount
Facilities (INR Crore) Ratings
---------- ----------- -------
Long Term Loan 31.19 CRISIL D (Issuer Not
Cooperating)
CRISIL Ratings has been consistently following up with YGP for
obtaining information through letters and emails dated May 10, 2022
and July 11, 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 YGP, which restricts CRISIL
Ratings' ability to take a forward-looking view on the entity's
credit quality. CRISIL Ratings believes that rating action on YGP
is consistent with 'Assessing Information Adequacy Risk'. Based on
the last available information, the ratings on bank facilities of
YGP continue to be 'CRISIL D Issuer Not Cooperating'.
YGP was set up in 2012 by Vivimed Labs Ltd, BBR Projects Pvt Ltd,
Mr. Santosh Varalwar, and Mr. Sandeep Varalwar. The company is
setting up a 5-megawatt solar photovoltaic-based power plant in
Hyderabad. The plant is expected to commence operations in October
2015.
=================
I N D O N E S I A
=================
AGUNG PODOMORO: Fitch Affirms 'CCC' LongTerm IDR
------------------------------------------------
Fitch Ratings has affirmed Indonesia-based developer PT Agung
Podomoro Land Tbk's (APLN) Long-Term Issuer Default Rating (IDR) at
'CCC'. Fitch has also affirmed the rating on APLN's USD300 million
5.95% notes due June 2024 at 'CCC' with a Recovery Rating of 'RR4'.
The notes are issued by APLN's wholly owned subsidiary, APL Realty
Holdings Pte. Ltd., and are guaranteed by APLN and several of its
subsidiaries.
APLN's ratings reflect its weak liquidity, in particular to cover
interest payments and operating costs at the holding company. The
ratings also recognise the high refinancing risk associated with
the maturity of APLN's SGD172.8 million loan from Guthrie Venture
Pte. Ltd., due on 20 November 2022. The loan repayment is
contingent on the sale of Central Park Mall, which is pledged
against the facility, or a renegotiation of terms with the lender.
The holding company's liquidity depends mostly on cash on hand,
rental income from Central Park Mall and cash flow from
subsidiaries, including dividends and the recovery of shareholder
loans. Fitch expects property presales to remain healthy in 2022,
supporting a steady consolidated cash balance at subsidiaries and,
in turn, the holding company's ability to meet its interest and
operating costs in the next six months.
KEY RATING DRIVERS
Minimal Holding Company Liquidity: Fitch estimates cash burn of
about IDR230 billion at the holding company in 2H22. This includes
cash inflow of about IDR140 billion, comprising mostly of rent from
Central Park Mall (2021: IDR287 billion), and outflow of about
IDR375 billion, predominantly interest payments and costs on
foreign-currency hedges (2021: IDR592 billion). APLN should be able
to address the IDR235 billion liquidity gap in 2H22 using dividend
receipts and by recovering shareholder loans (end-2021 shareholder
loan balance: IDR896 billion).
Cash Available at Subsidiaries: APLN reported a total consolidated
cash balance of about IDR1.2 trillion at end-1Q22. Fitch estimatse
that the five subsidiaries with the largest cash balances held
about IDR650 billion of cash, or about IDR450 billion excluding
minorities' share. About 35% of this cash is held at debt-free
subsidiaries, where the company has confirmed there is no further
construction spend. Fitch therefore expects this cash to be the
most easily accessible to APLN.
High Refinancing Risk: The SGD172.8 million (IDR1.8 trillion) loan
from Guthrie Venture, secured by Central Park Mall, is due to
mature on 20 November 2022. APLN plans to sell Central Park Mall
and use the proceeds to repay the debt. APLN has been trying to
sell the mall for the last two years and sold a 15% stake to CPM
Assets Indonesia in December 2020 for IDR705 billion. The company
has confirmed that the sale is progressing, but the timeline is
extremely tight, raising timely execution risk.
Recovery of Rental Income: Fitch expects the performance of Central
Park Mall to improve in line with Fitch's view for shopping malls
in Indonesia, with the removal of pandemic-led restrictions leading
to a recovery in footfall and tenant sales. The mall's occupancy
rate exceeded 93% at end-2021 and rental income rose during the
year. Fitch believes APLN may be able to negotiate an extension of
the loan's maturity with the lender should the mall sale be delayed
based on the quality of the collateral.
Lower, but Healthy Pre-Sales: Fitch expects consolidated pre-sales
to fall by about 15% to IDR2.5 trillion in 2022 (1H22: IDR1.2
trillion), but to remain healthy. Pre-sales in 2021 were supported
by Bank Indonesia incentives, such as the value-added tax rebate on
completed inventory. This rebate, which applies to homes valued at
less than IDR5 billion, was halved in 2022. The measure is due to
expire at end-September 2022. Fitch believes that the rebate pulled
forward housing demand, supporting consolidated pre-sales of IDR2.9
trillion in 2021.
SCP Aligned with Parent: APLN is 83% owned by PT Indofica, a
private company controlled by Trihatma Kusuma Haliman. Fitch
assesses the Standalone Credit Profiles (SCPs) of APLN and PT
Indofica at the same level; PT Indofica is debt free, with a small
portfolio of commercial property and land. Therefore, its SCP is
driven by its 83% stake in APLN, as its assets and EBITDA are not
significant enough to warrant a different SCP to APLN. As such, the
credit profile of PT Indofica does not impact APLN's rating under
Fitch's Parent and Subsidiary Linkage Criteria
DERIVATION SUMMARY
APLN's rating is lower than that of Indonesian peers, PT Alam
Sutera Realty Tbk (ASRI, B-/Stable), PT Lippo Karawaci TBK
(B-/Stable) and PT Kawasan Industri Jababeka Tbk (KIJA,
B-/Negative).
APLN's weak liquidity and high refinancing risk differentiate it
from ASRI, which has sufficient cash to cover its 2022-2023 debt
maturities, and Lippo, which has no debt maturities until 2025, but
enough cash to cover its negative free cash flow in 2022 and 2023.
The Negative Outlook on KIJA reflects the risk that its current
cash, combined with negative free cash flow, will not be enough to
cover its USD300 million bond maturity in October 2023.
KEY ASSUMPTIONS
-- Consolidated presales of IDR2.5 trillion-2.7 trillion
(attributable: IDR1.9 trillion-2.0 trillion) in 2022 and 2023;
-- EBITDA margin of about 30% in 2022 and 2023;
-- Cash outflow for construction of IDR1.7 billion in 2022;
-- Capex on fixed assets and investment properties of IDR300
billion in 2022 and 2023;
-- Consolidated free cash flow of about negative IDR650 billion
in 2022 and negative IDR300 billion in 2023.
RECOVERY RATING ASSUMPTIONS
Fitch assumes APLN will be liquidated in a bankruptcy rather than
continue as a going concern, because it is an asset-trading
company. In estimating APLN's liquidation and distribution value,
Fitch have made the following adjustments and assumptions:
-- Fitch uses a 75% advance rate against the value of trade
receivables;
-- Fitch uses a 65% advance rate against the value of inventory,
net of advances. This reflects Fitch’s assumption of a 100%
advance rate against the value of completed buildings and land
and a 50% advance rate against buildings under construction;
-- Fitch uses a 100% advance rate against investment properties
and property, plant and equipment, which is mainly related to
shopping mall and hotel assets. Fitch believes a 100% advance
rate is reasonable, as these assets are recognised at
historical cost, including depreciation, while the market
value is considerably higher;
-- Fitch has deducted the carrying value of the Pluit City and
Green Lake Sunter assets from investment property due to the
uncertainty around the development of these projects;
-- Fitch assumes committed undrawn construction facilities of
IDR800 billion are drawn and will rank prior to unsecured
noteholders in a liquidation. Fitch also assumes the funds
will be used to increase property inventory;
-- Fitch deducted 10% of the resulting liquidation value for
administrative claims.
These assumptions result in a recovery rate corresponding to an
'RR2' Recovery Rating for APLN's unsecured notes. Nevertheless,
Fitch rates the senior unsecured notes at 'CCC' with a Recovery
Rating of 'RR4', because under Fitch's Country-Specific Treatment
of Recovery Ratings Criteria, Indonesia falls into Group D of
creditor friendliness. Instrument ratings of issuers with assets in
this group are subject to a soft cap at the issuer's IDR and a
Recovery Rating at 'RR4'.
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
-- Fitch does not expect an upgrade until there is a significant
improvement in liquidity, including addressing the USD300
million bond maturing in June 2024;
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
-- Unsuccessful resolution of the November 2022 Guthrie loan
maturity in a timely manner;
-- Further weakening in liquidity.
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
Weak Liquidity: APLN's liquidity profile is under pressure due to
its November 2022 loan maturity, however, Fitch believes the
company may be able to negotiate an extension of the loan given the
quality of underlying collateral should the sale of its mall be
delayed.
APLN was not in compliance with the debt incurrence test on its
US-dollar notes as of end-2021, whereby its fixed-charge coverage
ratio was below 2.5x. This means additional debt issuance,
excluding refinancing, is capped under its permitted debt basket,
which the company confirmed was about IDR500 billion at 1H22. Fitch
estimates this IDR500 billion should be sufficient to fund
construction and capex for the next six to nine months.
Excluding the Guthrie loan, debt amortisation at subsidiaries of
about IDR180 billion in 2H22 is manageable. Fitch expects APLN to
fund the forecast negative free cash flow through the use of its
permitted debt basket, cash flow from operations and by using its
consolidated cash balance of IDR1.2 trillion at 1Q22. APLN had
committed credit lines for construction of about IDR800 billion in
1Q22, mainly for the Podomoro Park Bandung asset. Fitch believes
APLN may be able to use part of these lines to fund construction,
which could free up project cash flow to support the holding
company in the near term.
ISSUER PROFILE
APLN is an Indonesian property developer, with exposure to
residential and commercial properties. The company has generated an
average of IDR2 trillion of consolidated presales annually over the
last three years, excluding bulk land sales, mainly from four
projects in Jakarta, Bandung and Medan. It also owns and operates
malls, hotels and offices. Fitch expects presales to generate about
70% of consolidated revenue in 2022, with the remaining revenue
generated by recurring income from mall, hotel and office assets.
ESG CONSIDERATIONS
APLN has an ESG Relevance Score of '4' for Management Strategy and
Governance Structure due to the company's high development risk
profile, a key part of its strategy. This hampers financial
flexibility and leads to impending risk of default, which has a
negative impact on the credit profile, and is relevant to the
ratings in conjunction with other factors.
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.
RATING ACTIONS
ENTITY/DEBT RATING RECOVERY PRIOR
----------- ------ -------- -----
PT Agung LT IDR CCC Affirmed CCC
Podomoro Land Tbk
APL Realty Holdings
Pte. Ltd.
senior unsecured LT CCC Affirmed RR4 CCC
=========
J A P A N
=========
AEON CO: Egan-Jones Retains BB Senior Unsecured Ratings
-------------------------------------------------------
Egan-Jones Ratings Company, on August 11, 2022, retained its 'BB'
foreign currency and local currency senior unsecured ratings on
debt issued by AEON CO., LTD.
Headquartered in Chiba, Chiba, Japan, AEON CO., LTD. operates
general merchandise stores, supermarkets, and convenience stores
throughout Japan.
=====================
N E W Z E A L A N D
=====================
DELTA CIVIL: Court to Hear Wind-Up Petition on Sept. 2
------------------------------------------------------
A petition to wind up the operations of Delta Civil Limited will be
heard before the High Court at Auckland on Sept. 2, 2022, at 10:45
a.m.
The Commissioner of Inland Revenue filed the petition against the
company on July 19, 2022.
The Petitioner's solicitor is:
Cloete Van Der Merwe
Inland Revenue, Legal Services
5 Osterley Way
Manukau City
Auckland 2104
EXUBERANT LIMITED: Court to Hear Wind-Up Petition on Sept. 6
------------------------------------------------------------
A petition to wind up the operations of Exuberant Limited will be
heard before the High Court at Wellington on Sept. 6, 2022, at
10:00 a.m.
Ross Scott Davey and Lana Doreen Davey filed the petition against
the company on July 26, 2022.
The Petitioner's solicitor is:
Edward Cox
Gibson Sheat Lawyers
Level 5, 50 Customhouse Quay
Wellington 6011
FASHION FOCUS: To Shut Up Shop on End of September
--------------------------------------------------
Stuff.co.nz reports that another long-running South Canterbury
clothing store is closing, with the finger of blame pointed firmly
at Covid-19.
Stuff relates that Fashion Focus, in Timaru's Highfield Village
Mall, will close at the end of September, after owner Suzanne
Talbot took the "tough decision to close".
"It was tough, but it was the right thing to do - you've just got
to draw a line in the sand somewhere," she said.
According to Stuff, the decision follows the closure of Cameron's
stores in Timaru, Waimate and Oamaru, which closed after the
company which owned them went into voluntary liquidation in March
just shy of the brand clocking up 100 years in business.
Fashion Focus has been in business at the Highfield location, under
different owners, for "more than fifty years", Ms. Talbot said.
When she bought the business in March 2019, she focused on
developing special occasion wear and older women's fashion as her
niche areas.
But the pandemic made particular inroads into those markets, both
during lockdown and in the ensuing months when events were
cancelled, with many people, especially the elderly, choosing to
stay at home, Stuff relays.
In 2021, Ms. Talbot expanded into a new shop on Stafford St, which
she said at the time was in response to the need for more space, a
desire to expand into the younger and plus-sized fashion markets,
and to support the downtown retail area.
But in retrospect, she described the move as "a supreme disaster."
Stuff relates that Ms. Talbot said she had been reassured by the
positive economic recovery following the first lockdown, in which
spending surged across the economy.
"It didn't quite make up for the fact that you were shut, but there
was definite a bounce back, so we thought, well, if we go back into
another lockdown, we'll get the bounce back which will help."
But following the second lockdown retail spending dropped
significantly across the country, with no resurgence in spending to
match 2020.
"With both stores, Fashion Focus and Inspired on Stafford, we just
kind of limped after that.
"We had terrible summer trading - the weather was terrible - and we
went straight from there into minimal trade over autumn because
everyone was sick or wanting to stay home because they didn't want
to get Covid."
FRIENDLY BEANS: Creditors' Proofs of Debt Due on Sept. 15
---------------------------------------------------------
Creditors of The Friendly Beans Cafe Limited are required to file
their proofs of debt by Sept. 15, 2022, to be included in the
company's dividend distribution.
The company commenced wind-up proceedings on Aug. 15, 2022.
The company's liquidator is:
Bryan Edward Williams
BWA Insolvency Limited
PO Box 609
Kumeu 0841
WILSON AND GILLGREN: BDO Tauranga Appointed as Liquidators
----------------------------------------------------------
Paul Thomas Manning and Kenneth Peter Brown of BDO Tauranga on Aug.
15, 2022, were appointed as liquidators of Wilson and Gillgren
Limited.
The liquidators may be reached at:
BDO Tauranga Limited
Level 1, The Hub
525 Cameron Road
PO Box 15660
Tauranga 3144
ZAC CONSTRUCTION: Court to Hear Wind-Up Petition on Sept. 9
-----------------------------------------------------------
A petition to wind up the operations of Zac Construction Limited
will be heard before the High Court at Auckland on Sept. 9, 2022,
at 10:00 a.m.
The Commissioner of Inland Revenue filed the petition against the
company on July 19, 2022.
The Petitioner's solicitor is:
Cloete Van Der Merwe
Inland Revenue, Legal Services
5 Osterley Way
Manukau City
Auckland 2104
=================
S I N G A P O R E
=================
CHONG SING: Court Enters Wind-Up Order
--------------------------------------
The High Court of Singapore entered an order on Aug. 1, 2022, to
wind up the operations of Chong Sing Fintech (Singapore) Pte. Ltd.
Phang Yew Kiat filed the petition against the company.
The company's liquidators are:
Abuthahir Abdul Gafoor
Yessica Budiman
AAG Corporate Advisory Pte Ltd
144 Robinson Road
#14-02, Robinson Square
Singapore 068908
HANNA'S FUSION: Court Enters Wind-Up Order
------------------------------------------
The High Court of Singapore entered an order on Aug. 12, 2022, to
wind up the operations of Hanna's Fusion Pte. Ltd.
DBS Bank LTD filed the petition against the company.
The company's liquidator is:
Gary Loh Weng Fatt
BDO Advisory Pte Ltd
600 North Bridge Road
#23-01 Parkview Square
Singapore 188778
SIGNATURE BRIDAL: Court Enters Wind-Up Order
--------------------------------------------
The High Court of Singapore entered an order on Aug. 5, 2022, to
wind up the operations of Signature Bridal Pte. Ltd.
DBS Bank LTD filed the petition against the company.
The company's liquidator is:
Gary Loh Weng Fatt
BDO Advisory Pte Ltd
600 North Bridge Road
#23-01 Parkview Square
Singapore 188778
SOI GLOBAL: Court to Hear Wind-Up Petition on Sept. 2
-----------------------------------------------------
A petition to wind up the operations of Soi Global Pte Ltd will be
heard before the High Court of Singapore on Sept. 2, 2022, at 10:00
a.m.
Australian Grain Export Pty Ltd filed the petition against the
company on Aug. 12, 2022.
The Petitioner's solicitors are:
Messrs. Haridass Ho & Partners
24 Raffles Place
#18-00 Clifford Centre
Singapore 048621
SUNMAX GLOBAL: Court Enters Wind-Up Order
-----------------------------------------
The High Court of Singapore entered an order on Aug. 5, 2022, to
wind up the operations of Sunmax Global Capital Fund 1 Pte. Ltd.
Song Jianbo filed the petition against the company.
The company's liquidator is:
Wong Joo Wan
Alternative Advisors Pte Ltd
1 Commonwealth Lane
#06-21 One Commonwealth
Singapore 149544
=================
S R I L A N K A
=================
SRI LANKA: Hopes to Reach Initial Agreement with IMF for Help
-------------------------------------------------------------
The Associated Press reports that Sri Lanka's central bank chief
said Aug. 18 he hopes the government can reach a preliminary
agreement that could lead to a bailout package with the
International Monetary Fund when its officials visit the crisis-hit
island nation later this month.
The Indian Ocean country is effectively bankrupt and its economic
crisis set off massive public protests that led to the ouster of
President Gotabaya Rajapaksa last month. The government has said
the crisis has made the negotiations with the IMF difficult.
According to the AP, Nandalal Weerasinghe, the governor of Sri
Lanka's central bank, said he hoped IMF officials and Sri Lanka's
government could "finalize and reach a staff-level agreement" on
the policy package during their meetings.
Sri Lanka announced in April that it is suspending repayment of
foreign loans. Its total foreign debt is $51 billion, of which it
must pay $28 billion by 2027. The country has said it needs to
restructure all of its debt.
The AP says Weerasinghe told reporters Aug. 05 that the agreement
being sought with the IMF would give them "a clear picture on debt
sustainability and debt targets for us to achieve in the next 10
years."
Once an agreement is reached, Weerasinghe said, Sri Lanka would
approach sovereign bond holders and other external creditors.
"We hope all our creditors will support Sri Lanka once they see the
strong macro program endorsed by the IMF," the report quotes
Weerasinghe as saying.
The AP relates that Sri Lanka's new President Ranil Wickremesinghe
said two weeks ago that his government had initiated negotiations
with the IMF on a four-year rescue plan and had commenced the
finalization of a debt restructuring plan.
However, Wickremesinghe also said negotiations with the IMF have
been difficult because of Sri Lanka's bankruptcy and that an
expected early August target for an agreement with the agency was
not possible. It is now expected in September, the report notes.
Wickremesinghe was elected last month to complete the rest of
Rajapaksa's five-year term, which ends in 2024. Rajapaksa resigned
in exile and is now in Thailand.
The AP says the protesters blamed Rajapakasa and his powerful
family for years of mismanagement and corruption that have
bankrupted the nation and led to unprecedented shortages of
essential imports like fuel, medicine and cooking gas.
According to the report, Wickremesinghe's government is preparing a
national policy roadmap for the next 25 years that aims to cut
public debt and turn the country into a competitive export
economy.
Wickremesinghe has stressed that Sri Lanka needs long-term
solutions and a strong foundation to stop a recurrence of economic
crises, the AP relays.
About Sri Lanka
Sri Lanka, formerly known as Ceylon and officially the Democratic
Socialist Republic of Sri Lanka, is an island country in South
Asia. It lies in the Indian Ocean, southwest of the Bay of Bengal,
and southeast of the Arabian Sea; it is separated from the Indian
subcontinent by the Gulf of Mannar and the Palk Strait. Sri Lanka
shares a maritime border with India and the Maldives. Sri
Jayawardenepura Kotte is its legislative capital, and Colombo is
its largest city and financial centre.
Sri Lanka has been mired in turmoil amid surging inflation, a
plummeting currency and an economic crisis that has left the
country short of the hard currency it needs to import food and
fuel, according to Bloomberg News. Public anger has boiled over
into violent protests and led the government to announce in April
2022 it would halt payments on its $12.6 billion pile of foreign
debt to preserve cash for essential goods.
That marks the nation's first sovereign debt default since it
gained independence from Britain in 1948, Bloomberg said. Its bonds
are among the worst performers in the world this year and trade
deep in distressed territory, with holders bracing for losses
approaching 60 cents on the dollar.
Sri Lanka's crisis sparked months of mass protests and eventually
forced then president Gotabaya Rajapaksa to flee the country.
On July 20, 2022, Ranil Wickremesinghe was elected as Sri Lanka's
new head of state backed by a majority of lawmakers from ousted
leader Gotabaya Rajapaksa's party.
===============
T H A I L A N D
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KTBST SECURITIES: Fitch Gives 'BB(tha)' Rating on Sub. Debentures
-----------------------------------------------------------------
Fitch Ratings (Thailand) has assigned a National Long-Term Rating
of 'BB(tha)' to KTBST Securities Public Company Limited's
(KTBSTSEC, BB+(tha)/Stable/B(tha)) upcoming issue of up to THB150
million in subordinated unsecured debentures.
The debentures will have a maturity of 11 months and 30 days. The
company plans to use the proceeds to refinance outstanding
subordinated debentures.
KEY RATING DRIVERS
KTBSTSEC's subordinated debentures are rated one notch below its
National Long-Term Rating to reflect the subordinated debentures'
higher loss-severity risk relative to senior unsecured instruments,
as per Fitch's Corporate Hybrids Treatment and Notching Criteria.
This arises from the debentures' subordinated status, as
subordinated noteholders rank after senior creditors in the
priority of claims. Additional notching has not been applied due to
the lack of going-concern loss-absorption and equity-conversion
features. Fitch has not assigned equity credit to the issue as the
instrument is not designed to be a permanent part of the company's
capital structure.
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
-- The National Long-Term Rating on the subordinated debentures
is sensitive to changes in KTBSTSEC's National Long-Term
Rating, which is the anchor rating.
-- A downgrade of KTBSTSEC's National Long-Term Rating would
result in a downgrade of the subordinated debenture rating.
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
-- An upgrade of KTBSTSEC's National Long-Term Rating is likely
to lead to similar action on the rating of the subordinated
debentures.
RATING ACTIONS
ENTITY/DEBT RATING PRIOR
----------- ------ -----
KTBST Securities
Public Company
Limited
subordinated Natl LT BB(tha) New Rating
=============
V I E T N A M
=============
MONG DUONG FINANCE: Fitch Affirms BB on USD679MM Notes Due 2029
---------------------------------------------------------------
Fitch Ratings has affirmed the 'BB' rating on the USD679 million
5.125% senior secured notes due 2029 issued by Mong Duong Finance
Holdings B.V., a Netherlands-domiciled SPV. The Outlook is
Positive. The issuer acquired all of Vietnam-based AES Mong Duong
Power Company Limited's (AES MD) outstanding project financing
loans raised for the Mong Duong 2 (MD2) power plant.
RATING RATIONALE
The notes' rating remains constrained by Vietnam's sovereign rating
(BB/Positive) due to the government guarantee of state counterparty
obligations. The underlying standalone credit profile is assessed
as 'bbb-', on the robust take-or-pay power purchase agreement (PPA)
with state-owned Vietnam Electricity (EVN, BB/Positive) until 2040,
pass-through of fuel costs, government guarantee covering
obligations of Vietnamese state counterparties under the PPA and
coal supply agreement, experienced in-house management and a fully
amortising debt structure insulates the project against refinancing
risk.
KEY RATING DRIVERS
Robust Long-Term PPA: Revenue Risk - Stronger
MD2 has a long-term PPA with EVN until 2040. The tariff structure
is designed to cover debt servicing, a certain return of equity and
fixed operating and maintenance (O&M) costs, regardless of
electricity output, and compensate variable O&M costs and fuel
reimbursement, although the latter is subject to meeting contracted
heat rate requirements. The take-or-pay mechanism effectively
eliminates merchant power-price risk and underpins the visibility
of cash flow. Inflation risk is further mitigated through
indexation to the US's and Vietnam's CPI for O&M components in the
tariff.
In addition, Fitch views the pass-through of costs associated with
changes in environmental legislation or permits to EVN as standard
and the termination provisions under the PPA as a stronger
attribute.
Experienced In-House Operator: Operation Risk - Midrange
MD2 is run by an experienced in-house team under cost-plus
technical services agreements and employs conventional commercially
proven technology with a stable operating record. MD2 has
maintained its availability above the contracted level.
The allowed outages energy is calculated annually, which allows a
forced outage in one month to be compensated by higher availability
in the next month. MD2 is also permitted to carry up to 160GWh of
allowed outages energy from one year to another if it remains
unutilised.
Heat rates have improved after combustion issues were resolved and
through the use of better quality coal and an enhanced operating
system, coupled with operational efficiency improvements, such as
reduction in load change times. However, it is too early to gauge
the sustainability of the improvement. In addition, the cost-plus
nature of the O&M contract and limited technical advisor inputs in
the rating process expose the project to a certain level of cost
uncertainty. These factors constrain Fitch's operation risk
assessment to 'Midrange'.
Fuel Supply Risk Passed Through: Supply Risk - Midrange
MD2 benefits from a 25-year coal-supply agreement signed with
Vinacomin, at a regulated coal price not exceeding that charged to
other EVN power plants. The performance obligations and financial
commitments of Vinacomin are further backed by a government
guarantee covering the whole debt tenor. The build-operate-transfer
(BOT) contract further insulates the project against the risk of
coal supply interruptions.
It also reserves the right to buy coal from an alternative source
while Vinacomin is obligated to compensate the increase in cost
capped by 3%. In addition to abundant supply of fuel sources
available near the project site, Vinacomin has a large pipeline of
projects and planned new coal mines to sustain the domestic coal
supply.
Fully Amortising, Non-Standard Structure - Debt Structure:
Midrange
The offshore SPV issued a four-year loan and 10-year senior secured
fixed-rate notes to refinance the BOT loan of AES MD at a lower
interest rate. The new debt, which has the same quantum and
amortisation profile as the BOT loan, will be serviced by BOT loan
debt-service payments.
The security package of the original financing is available to the
new lenders, but indirectly through the loan provided by the
offshore SPV to AES MD. The new lenders will also benefit from a
pledge of shares in the SPV and security over the SPV's assets. The
transaction's structure is not standard due to a lack of a direct
relationship between the offshore SPV and AES MD, either through
the shareholding of the offshore SPV or a guarantee from AES MD.
The debt is fully amortising and ranks pari passu. The amortisation
will be sequential among the two tranches. The debt is protected by
covenants, including limitations on indebtedness, business
activities and asset disposals. It further benefits from a
backward-looking distribution lock-up at a 1.15x debt-service
coverage ratio (DSCR) and six-month debt-service reserve in the
form of a letter of credit. The maintenance reserve account will
also be prefunded for major overhaul capex over the next six
years.
PEER GROUP
Fitch said, "We view the notes (BBB-/Stable) issued under Minejesa
Capital BV and guaranteed by PT Paiton Energy as comparable.
Paiton, in eastern Java, is the second-largest independent power
producer in Indonesia with an installed capacity of 2,045MW (net)
for its three-unit power complex, of which one unit is also using
super-critical pulverised coal technology. Both projects are
protected by take-or-pay long-term PPAs with fuel cost effectively
passed through to off-takers, and run by experienced in-house
teams, while Paiton benefits from a longer operating history.
Paiton's debt structure is more typical of project finance
transactions. Paiton has an average profile annual DSCR of 1.42x
and a minimum of 1.21x in Fitch's rating case."
MD2 also compares well against PT Lestari Banten Energi (LBE),
which guaranteed the notes (BBB-/Stable) issued under LLPL Capital
Pte. LBE operates a 635MW super-critical coal-fired power plant in
west Java. Similar to MD2, the project has a favourable long-term
PPA with the state-owned electricity supplier to insulate it
against merchant risk. LBE also benefits from input from US-based
Black & Veatch, which allows Fitch to apply lower stress in the
rating case. LBE's debt is fully amortising with a six-month
debt-service reserve account and a distribution lockup at 1.20x
DSCR, which is slightly stronger than that of MD2. LBE has an
average profile annual DSCR of 1.37x and a minimum of 1.17x in
Fitch's rating case.
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
-- A downgrade of Vietnam's sovereign rating to 'BB-';
-- Operational difficulties or other developments that result in
the projected annual DSCR dropping below 1.20x in Fitch's rating
case.
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
-- An upgrade of Vietnam's sovereign rating to 'BB+' with no
deterioration in the underlying credit profile.
CREDIT UPDATE
MD2 generally recorded a satisfactory operational performance in
Contract Year 7 (22 April 2021 - 21 April 2022). It managed to beat
the PPA availability target by 0.6% and maintain the actual
availability close to the PPA level to optimise the return. No
penalty is imposed due to the failure of meeting PPA availability
requirement.
During the same period, the net capacity factor averaged 69%,
against 64% in the prevailing contract year, despite the low
generation during 2H21, due mainly to the scheduled outage and
limited forced outage. Fitch deems the impact of the dispatch level
to cash flow volatility as minimal under the take-or-pay PPA
structure.
The improvement of the heat rate continued after combustion issues
were resolved in 2020. In Contract Year 7, the heat rate
outperformed PPA requirement on better coal quality, an enhanced
operating system and improved operational efficiency. Fitch will
continue to monitor the heat rate performance and the
sustainability of the improvement.
The sound operation overall leads to a healthy cash flow with DSCR
of 1.58x for the 12-month period ended in March 2022, without any
breach of debt covenants.
It is reported that AES Corporation signed an agreement on
December 31, 2020 to sell its entire equity interest in MD2 to a
consortium led by a US-based investor. China Investment Corporation
(CIC) then tagged along to sell its 19% interest. AES and CIC are
in midst of obtaining transaction approvals from the Vietnamese
government, subject to a government evaluation process with
uncertain timing. The potential effect on the rating will be
further assessed when more information is disclosed publicly.
FINANCIAL ANALYSIS
Fitch focuses on average and minimum profile DSCRs to evaluate the
resilience of the projected cash flow, given the fully amortising
nature of the debt and definite term of PPA.
Fitch's base case largely follows management's forecast on key
operating assumptions except the heat rate, which is projected to
be 0.5% above the PPA's target. It also factors Fitch's
macroeconomic assumptions for the US's and Vietnam's CPI and
exchange rates. MD2's annual DSCR is averaged at 1.48x with a
minimum DSCR of 1.43x (previously 1.49x and 1.43x) under Fitch's
base case.
Fitch's rating case further applies a combination of stresses on
outage durations (1pp increase to annual forced outages duration
and 10% stress to planned outage durations), and a heat rate 2%
above the PPA's target given historical underperformance of the
plant and 15% increase on the operating costs and capex, in line
with Fitch's Thermal Power Projects Rating Criteria, resulting in a
revised average annual DSCR of 1.39x and minimum of 1.33x
(previously 1.40x and 1.32x).
REFERENCES FOR SUBSTANTIALLY MATERIAL SOURCE CITED AS KEY DRIVER OF
RATING
The principal sources of information used in the analysis are
described in the Applicable Criteria.
PUBLIC RATINGS WITH CREDIT LINKAGE TO OTHER RATINGS
The rating of MD2's notes is capped at Vietnam's country ceiling.
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.
Rating Action
Rating Prior
------ -----
Mong Duong Finance Holdings B.V.
Mong Duong Finance Holdings
B.V./Debt/1 LT LT BB Affirmed BB
*********
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-
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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.
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