/raid1/www/Hosts/bankrupt/TCRAP

/raid1/www/Hosts/bankrupt/TCRAP_Public/221003.mbx T R O U B L E D C O M P A N Y R E P O R T E R A S I A P A C I F I C Monday, October 3, 2022, Vol. 25, No. 191 Headlines A U S T R A L I A CHAUFFEURS AUSTRALIA: First Creditors' Meeting Set for Oct. 10 GEORGE PITT: First Creditors' Meeting Set for Oct. 7 PITHARA QUARRIES: Second Creditors' Meeting Set for Oct. 6 ROWE STREET: First Creditors' Meeting Set for Oct. 7 SUPERANNUATION AND INVESTMENTS: S&P Lowers Long-Term ICR to 'BB-' VALOR DEVELOPMENTS: First Creditors' Meeting Set for Oct. 10 [*] Bankruptcy Laws to be Reviewed Amid Jump in Business Failures C H I N A FOSUN GROUP: Close to Getting US$2.11BB Loan Amid Cash Crunch GOME ELECTRICAL: Loses Third CEO in 14 Months I N D I A AKASH PET: CARE Keeps C Debt Ratings in Not Cooperating AMANTA HEALTHCARE: Ind-Ra Gives BB+ Issuer Rating, Outlook Stable ARYAVRAT TRADING: Liquidation Process Case Summary BANSAL SUPER: Ind-Ra Moves BB+ Issuer Rating to Non-Cooperating BBT ELEVATED: CARE Keeps D Debt Rating in Not Cooperating BP FERRIUM INDUSTRIES: Liquidation Process Case Summary DAKSHIN BUDHAKHALI: CARE Keeps D Debt Rating in Not Cooperating DEEM CONSTRUCTION: CARE Keeps D Debt Rating in Not Cooperating DENEB AUTOMOTIVES: Insolvency Resolution Process Case Summary DEVI INFRADEVELOPERS: Liquidation Process Case Summary DURGESHWARI INDUSTRIES: CARE Keeps D Ratings in Not Cooperating EASUN PRODUCTS: Insolvency Resolution Process Case Summary ECLAT INDUSTRIES: Insolvency Resolution Process Case Summary EZHIL CHEMICAL: Insolvency Resolution Process Case Summary GAYATRI PROJECTS: Canara Bank Files Insolvency Plea vs. Company GINGER INFRASTRUCTURE: CARE Keeps D Debt Rating in Not Cooperating GMR WARORA: Ind-Ra Affirms 'D' NonConvertible Debt Rating GOODWILL TEA: CARE Keeps D Debt Rating in Not Cooperating ICE TOUCH: CARE Keeps C Debt Rating in Not Cooperating INDIAN STATE OF KERALA: S&P Affirms 'BB-/B' ICRs, Outlook Stable INDSIL HYDRO: Ind-Ra Affirms 'D' Long-Term Issuer Rating JOVIAL STAINLESS: CARE Keeps D Debt Rating in Not Cooperating KADAM AND KADAM: CARE Keeps D Debt Ratings in Not Cooperating KALYAN JEWELLERS: S&P Withdraws Prelim 'B' Issuer Credit Rating KAMACHI INDUSTRIES: Ind-Ra Affirms 'D' Long-Term Issuer Rating KASHIPUR INFRASTRUCTURE: Ind-Ra Keeps BB Rating in Non-Cooperating KERALA INFRASTRUCTURE: S&P Affirms 'BB-/B' ICRs, Outlook Stable MICROTEX FASHION: CARE Keeps D Debt Ratings in Not Cooperating MOHAN MOTOR: Liquidation Process Case Summary NARAYAN BUILDERS: Ind-Ra Affirms BB- Issuer Rating, Outlook Stable PADMAVATI ASSOCIATES: CARE Keeps C Debt Rating in Not Cooperating PARASHAR COKE: CARE Keeps D Debt Rating in Not Cooperating PMV MALTINGS: ICRA Keeps B+ Debt Ratings in Not Cooperating PRASAD EDUCATION: CARE Keeps D Debt Rating in Not Cooperating SANGHI INDUSTRIES: Ind-Ra Cuts Long-Term Issuer Rating to 'BB+' SHAKTI BHOG: Insolvency Resolution Process Case Summary SIDDHI VINAYAK: CARE Keeps C Debt Rating in Not Cooperating SINHA SQUARE: CARE Keeps D Debt Rating in Not Cooperating SOUTH EAST UP: Ind-Ra Withdraws 'D' Sr. Project Bank Loan Rating SREEVEN CONSTRUCTIONS: CARE Keeps C Debt Rating in Not Cooperating SULABH PHARMACEUTICAL: CARE Keeps D Ratings in Not Cooperating UMANG BOARDS: Ind-Ra Gives 'BB+' LT Issuer Rating, Outlook Stable V AND S INTERNATIONAL: CARE Keeps D Ratings in Not Cooperating VANI ORGANICS: CARE Keeps C Debt Rating in Not Cooperating VENTURE POWER: Liquidation Process Case Summary VRJ TRADERS PRIVATE: Liquidation Process Case Summary J A P A N TOSHIBA CORP: Bidders Narrowed Down to Two Company Groups N E W Z E A L A N D DOGTAG (2018): Creditors' Proofs of Debt Due on Oct. 19 LUSCIOUS LIVING: BDO Tauranga Appointed as Liquidators TFS 2012: Court to Hear Wind-Up Petition on Oct. 10 WE FENCE: Court to Hear Wind-Up Petition on Oct. 25 WELDERS & STEEL: Court to Hear Wind-Up Petition on Oct. 10 P H I L I P P I N E S MACTAN APPARELS: 4,000 Workers From 5 MEPZ Firms Lose Jobs S I N G A P O R E SEA GROUP: Shopee Cuts Jobs in Malaysia UNIQUE REALTY: Creditors' Proofs of Debt Due on Oct. 30 VANTERES PTE: Commences Wind-Up Proceedings WAN CHUNG: Foo Kon Tan Appointed as Liquidators WATERVILLE INVESTMENT: Creditors' Proofs of Debt Due on Oct. 31 WAYNE BURT: Creditors' Proofs of Debt Due on Oct. 14 S R I L A N K A AMANA BANK: Fitch Maintains 'BB+(1ka)' Rating on Watch Neg. HOUSING DEVELOPMENT: Fitch Keeps 'BB+(1ka)' Rating on Watch Neg. SANASA DEVELOPMENT: Fitch Keeps 'BB+(1ka)' Rating on Watch Neg. - - - - - ================= A U S T R A L I A ================= CHAUFFEURS AUSTRALIA: First Creditors' Meeting Set for Oct. 10 -------------------------------------------------------------- A first meeting of the creditors in the proceedings of Chauffeurs Australia Pty. Ltd. will be held on Oct. 10, 2022, at 11:00 a.m. via electronic means. Richard Stone of RSM Australia Partners was appointed as administrator of the company on Sept. 27, 2022. GEORGE PITT: First Creditors' Meeting Set for Oct. 7 ---------------------------------------------------- A first meeting of the creditors in the proceedings of George Pitt Pty Ltd, trading as Taste of Shanghai (World Square) will be held on Oct. 7, 2022, at 10:00 a.m. via virtual meeting technology. Christopher Damien Darin of Worrells Solvency & Forensic Accountants was appointed as administrator of the company on Sept. 27, 2022. PITHARA QUARRIES: Second Creditors' Meeting Set for Oct. 6 ---------------------------------------------------------- A second meeting of creditors in the proceedings of Pithara Quarries Pty Ltd has been set for Oct. 6, 2022, at 2:00 p.m. via virtual meeting 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 Oct. 5, 2022, at 4:00 p.m. Robert Michael Kirman of McGrathNicol was appointed as administrator of the company on Aug. 30, 2022. ROWE STREET: First Creditors' Meeting Set for Oct. 7 ---------------------------------------------------- A first meeting of the creditors in the proceedings of Rowe Street Pty Ltd will be held on Oct. 7, 2022, at 10:30 a.m. via virtual meeting technology. Christopher Damien Darin of Worrells Solvency & Forensic Accountants was appointed as administrator of the company on Sept. 27, 2022. SUPERANNUATION AND INVESTMENTS: S&P Lowers Long-Term ICR to 'BB-' ----------------------------------------------------------------- On Sept. 29, 2022, S&P Global Ratings lowered its long-term issuer credit rating on Superannuation and Investments Finco Pty Ltd. (SIF), the nonoperating holding company and debt-issuing vehicle of Australia-based wealth manager Colonial First State group, to 'BB-' from 'BB'. At the same time, S&P affirmed its 'B' short-term issuer credit rating on the entity. The outlook on the long-term rating is stable. The recovery rating is unchanged at '3'. S&P said, "We now believe that SIF is likely to operate with a leverage ratio (debt to adjusted EBITDA) of above 5x over the next 12 months. This is higher than our previous expectation of 4x-5x. Lower earnings than we previously forecast and increased debt issuance to fund investments in new technologies will drive the higher leverage. "We now consider SIF's financial risk profile to be highly leveraged and more in line with that of entities owned by financial sponsors such as private equity funds. We previously believed the company's minority shareholder, Commonwealth Bank of Australia (CBA; AA-/Stable/A-1+), would maintain strong influence over SIF's financial policy, including leverage. We expected CBA's lower risk appetite relative to the major shareholder (KKR & Co. Inc.) to mitigate some of the risks associated with SIF's ownership by a financial sponsor. "In our view, SIF will be prepared to increase leverage, if needed. This is notwithstanding a potential decline in leverage from its peak in 2023 as earnings benefit from technology investments and improving markets. "We apply a one-notch positive comparative ratings adjustment to reflect our view that some elements of SIF's financial profile such as liquidity and leverage are stronger than a peer owned by a financial sponsor. The adjustment also reflects our expectation that SIF's leverage will remain at 5x-6x over the next 12 months. "The outlook on SIF is stable. We expect the company's debt-to-adjusted EBITDA ratio to remain at 5x-6x over the next 12 months. "We could lower the ratings if SIF's ratio of debt to adjusted EBITDA rises further or its business operations and market share deteriorate significantly." Upside scenario In S&P' view, an upside scenario is remote. It is unlikely to raise the ratings as long as KKR or another financial sponsor remains a majority shareholder, even if SIF's leverage falls below 5x. ESG credit indicators: E-2, S-2, G-3 VALOR DEVELOPMENTS: First Creditors' Meeting Set for Oct. 10 ------------------------------------------------------------ A first meeting of the creditors in the proceedings of Valor Developments Pty Ltd will be held on Oct. 10, 2022, at 11:00 a.m. via virtual meeting technology. Daniel Frisken of O'Brien Palmer was appointed as administrator of the company on Sept. 27, 2022. [*] Bankruptcy Laws to be Reviewed Amid Jump in Business Failures ----------------------------------------------------------------- The Australian Financial Review reports that Australia's bankruptcy laws will come under the microscope in the most extensive review into insolvency in more than three decades, as the end of pandemic-era support prompts the collapse of financially stretched businesses. AFR relates that the inquiry is likely to recommend ways to simplify the country's notoriously complex insolvency regime, but the Albanese government said it wants to find new ways to help struggling businesses and solidify insolvency as a last resort measure. According to AFR, Parliament's Joint Committee on Corporations and Financial Services announced on Sept. 28 it would review existing bankruptcy laws, the effectiveness of regulators such as the Australian Securities and Investments Commission (ASIC) and the fees paid to liquidators. The inquiry comes amid a jump in business failures, which hit a 2-1/2-year high in July after a surge in construction-sector insolvencies, the report notes. AFR says the push for a sweeping review into bankruptcy laws has grown since March, when a panel of experts commissioned by the Morrison government found the current regimen was "an impenetrable quagmire that is scary, complex and unknown" and merited fresh scrutiny. Committee chairwoman Deborah O'Neill said turbulent economic conditions meant a review was necessary. "There has been no substantive review in 34 years of Australia's insolvency structures. The historical moment is now, especially as Australia sees an uptick of insolvencies as pandemic-era protections wane, and businesses battle inflation and supply-chain issues," the Labor senator said. More than 700 firms entered into external administration in July, AFR discloses citing data from the ASIC. The figure was the highest level since November 2019 and more than double the lows of 2020 and 2021, when a range of government policies such as JobKeeper and temporary changes to insolvent trading laws kept a lid on failures. According to the report, experts and the Reserve Bank said business failures are poised to increase further, as soaring costs and a Tax Office crackdown on unpaid debts heap further pressure on firms in the embattled construction and manufacturing sectors. AFR relates that the largest increase in administrations over the past year was in the construction sector, where firms are laying off workers or collapsing in response to supply shortages and sharply increasing material costs. Manufacturing sector administrations also increased sharply in July. East coast manufacturers have been hit by surging natural gas prices due to a mixture of coal power outages and instability in global energy markets owing to Russia's invasion of Ukraine. Among the issues the review will canvass is the role and remuneration of liquidators, the effectiveness of ASIC as the insolvency regulator, the Tax Office's approach to debt collection and the operation of existing pieces of legislation, AFR notes. The committee flagged multiple potential areas for reform, including unfair preference claims, which is when an insolvent company pays one creditor and not another, as well as safe harbour provisions, which provide protection to directors from insolvent trading laws while they try to save a failing business. Small business restructuring laws, which allow firms with up to $1 million in liabilities to seek advice from an insolvency practitioner on developing a restructuring plan, will also be reviewed, as will new laws penalising directors who avoid paying workers' entitlements during insolvency. AFR adds that Ms. O'Neill said insolvency should be the last intervention for struggling businesses, with the review also set to assess how to improve access to corporate support for firms in financial distress. ========= C H I N A ========= FOSUN GROUP: Close to Getting US$2.11BB Loan Amid Cash Crunch ------------------------------------------------------------- Caixin Global reports that Fosun Group is close to receiving a CNY15 billion (US$2.11 billion) syndicated loan from a group of banks to help one of China's largest private conglomerates through a short-term cash crunch, according to people familiar with the matter. The loan completed reviews by participating banks including Industrial and Commercial Bank of China and China Minsheng Bank and is pending final approval, sources from the banks told Caixin. The first tranche of funds is expected to be released next month, they said. The loan will go to Fosun International Ltd., the group's main investment arm, the report relates. Fosun International Limited provides diversified services. The Company offers products and services for families in health, happiness, and wealth businesses. Fosun International serves clients worldwide. As recently reported in the Troubled Company Reporter-Asia Pacific, on Sept. 16, 2022, S&P Global Ratings lowered the long-term issuer credit rating on China-based investment holding company Fosun International Ltd. and the issue rating on the company's guaranteed senior unsecured debts to 'BB-' from 'BB'. The negative outlook reflects the difficulties to meaningfully extend the company's debt maturity profile over the next 12 months and uncertainties in its plan to sell assets. Fosun faces narrowing liquidity headroom and a shortening debt maturity profile amid hurdles to access both onshore and offshore bond markets and macroeconomic uncertainty. GOME ELECTRICAL: Loses Third CEO in 14 Months --------------------------------------------- Yicai Global reports that the chief executive officer of troubled Chinese home appliance retailer Gome Electrical Appliances has departed after less than a year in the job, in the third such resignation in the last 14 months. Wang Wei stepped down as CEO late last month due to personal reasons, Yicai Global learnt from an insider familiar with this matter. Senior Vice President Li Juntao will take charge until a replacement can be found. Yicai Global says there have been three CEOs at the unit of beleaguered white goods retailer Gome Holdings Group in little over a year. 45-year-old Wang Wei took over from Wang Bo earlier this year, when Wang Bo was transferred to head the firm's businesses in eastern China and Shanghai. Wang Bo had only been in the position since October last year after Zhang Deju stepped down due to health issues last July. And it is not just the CEO post that is proving hard to fill. The CEO of Gome Holdings' after-sales services, Zeng Zhining, quit last month together with Ding Wei, executive vice president of Gome Holdings' e-commerce platform Zhenkuaile, Yicai Global learnt. And He Yangqing, head of the group's investment company, also stood down recently. Yicai Global relates that the instability is indicative of the debt-crisis engulfing the parent firm. Beijing-based Gome Holdings told Yicai Global earlier last week that it was unable to pay its staff wages this month and it that may have to start letting staff go. As one of the largest brick-and-mortar retailers in China, Gome Holdings has struggled to find its feet since its founder Huang Guangyu was jailed for insider trading and graft in 2010, although he has since been released, according to Yicai Global. Business was also hard hit by coronavirus outbreaks that shuttered stores and upended deliveries of online orders, the firm said in its first-half earnings report. And the company has stumbled amid stiff online competition from the likes of Alibaba Group Holding and JD.com and has lost money for five consecutive years, Yicai Global notes. Its losses widened 50 percent to CNY2.9 billion (USD414 million) in the six months ended June 30 from a year earlier, while revenue sank 53 percent to CNY12.1 billion (USD1.6 billion), Yicai Global discloses. The share price of the group's listed arm Gome Retail closed down 3.23 percent at HKD0.15 (USD0.19) on Sept. 28. The stock has lost 77 percent in value so far this year. GOME Retail Holdings Limited (HK:0493) -- https://www.gome.com.hk/ -- together with its subsidiaries, engages in the retail of electrical appliances, consumer electronic products, and general merchandise in the People's Republic of China. The company also sells its products online through self-operated and platform models. In addition, it is involved in the provision of logistics and procurement, storage and delivery, IT development, and business management services; retailing of mobile phones and accessories; and property holding activities. As of December 31, 2021, it operated 4,195 stores in 1,439 cities. The company was formerly known as GOME Electrical Appliances Holding Limited and changed its name to GOME Retail Holdings Limited in 2017. GOME Retail Holdings Limited was founded in 1987 and is headquartered in Central, Hong Kong. ========= I N D I A ========= AKASH PET: CARE Keeps C Debt Ratings in Not Cooperating ------------------------------------------------------- CARE Ratings said the rating for the bank facilities of Akash Pet Containers Private Limited (APCPL) continues to remain in the 'Issuer Not Cooperating' category. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term 6.80 CARE C; Stable; ISSUER NOT Bank Facilities COOPERATING; Rating continues to remain under ISSUER NOT COOPERATING category Detailed Rationale & Key Rating Drivers CARE Ratings Ltd. had, vide its press release dated July 22, 2021, placed the rating(s) of APCPL under the 'issuer non-cooperating' category as APCPL 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. APCPL continues to be noncooperative despite repeated requests for submission of information through e-mails, phone calls and a letter/email dated June 7, 2022, June 17, 2022, June 27, 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). Akash Pet Containers Private Limited (APCPL) was incorporated in 2011 promoted by Mr. D. Manickasundaram, Managing Director along with Ms. A. Indira and Mr. V. Ramakrishna. APCPL is engaged in manufacturing of Polyethylene terephthalate (PET) bottle since its inception (commercial operation started from September 2012 and FY14 was the first full year of operation). AMANTA HEALTHCARE: Ind-Ra Gives BB+ Issuer Rating, Outlook Stable ----------------------------------------------------------------- India Ratings and Research (Ind-Ra) has assigned Amanta Healthcare Limited (AHL) a Long-Term Issuer Rating of 'IND BB+'. The Outlook is Stable. The instrument-wise rating actions are: -- INR382.5 mil. Fund-based limits assigned with IND BB+/Stable/ IND A4+ rating; -- INR107.5 mil. Non-fund-based limits assigned with IND A4+ rating; -- INR10.0 mil. Proposed fund-based/non-fund-based limits assigned with IND BB+/Stable/IND A4+ rating; and -- INR50.0 mil. Fixed deposit program assigned with IND BB+/ Stable rating. Key Rating Drivers The rating reflects AHL's medium scale of operations. The company's revenue grew at a CAGR of 6.84% to INR2,254.4 million over FY19-FY22 (FY22: up 31.6% yoy), majorly driven by an 87% increase in manufacturing capacity of Steriport and addition of new distributors in FY22. During FY22, AHL derived more than 58% of its revenue from fluid therapy, followed by formulations (11.1%) and injections (10.2%). Exports accounted for 28%-35% of the sales in FY22. Ind-Ra expects the revenue to increase further in the near-to-medium team owing to full-year utilization of the expanded capacity in FY23. The company holds about 40% market share in Steriport as of August 2022. The ratings also factor in AHL's average EBITDA margins of 23.09% in FY22 (FY21: 22.38%, FY20: 20.27%) with a return on capital employed of 12.05% (8.81%, 8.02%). The improvement in the margins was due to a reduction in administration and selling expenses. The absolute EBITDA stood at INR520.59 million in FY22 (FY21: INR383.38 million; FY20: INR373.70 million). The agency expects the EBITDA margins to remain at 20%-22% in FY23 while the absolute EBITDA is expected to improve with the growth in revenue. Despite generating EBITDA profits, AHL reported losses after tax over FY19-FY21, majorly driven by increasing interest and finance cost owing to the high-cost debt availed by the company, resulting in an erosion of net worth to INR72.6 million in FY21. However, in FY22, AHL recorded a net profit of INR551.06 million, due to an exceptional gain of INR746.6 million owing to write-off of accrued interest by the lenders, which was part of the settlement deal, leading to an improvement in its net worth to INR623.7 million. In FY22, KKR India Financial Services Private Limited and its consortium debt was replaced with Piramal Alternatives Private Limited's debentures. The ratings are also constrained by AHL's weak credit metrics with net leverage (net adjusted debt/EBITDAR) of 4.09x in FY22 (FY21: 6.0x, FY20: 6.14x) and interest coverage (operating EBITDA/gross interest expense) of 1.26x (1.82x, 1.93x). The total debt stood at INR2,256.4 million at FYE22 (FYE21: INR2,346.4 million, FYE20: INR2,311.6 million), comprising of short-term debt of INR404.49 million (INR370.3 million, INR336.4 million), unsecured loans from directors/promoters of INR52.16 million (INR52.88 million, INR48.5 million), non-convertible redeemable preference shares of INR100 million (nil, nil), high-cost debt in the form of 14% seven-year non-convertible debentures of INR1,520 million (nil, nil) and term loans of INR179.8 million ( INR1,207.93 million, INR1,207.02 million). The company has scheduled repayments of INR34.6 million in FY23 and INR35.34 million in FY24, against net cash accruals of INR724.4 million in FY22. The repayment of non-convertible debentures is likely to commence from June 2024 on a quarterly basis, while the preference shares have a bullet repayment on maturity in FY26. Since there are no major repayments till June 2024, the agency expects the credit metrics to improve in FY23, subject to a growth in the scale of operations. In FY23, the company prepaid Piramal Alternatives's debentures of about INR42.5 million, for which the repayment will commence in June 2024. Liquidity Indicator – Stretched: AHL's peak average utilization of the fund-based limits was 95.2% for the 12 months ended July 2022. The working capital cycle improved to 132 days in FY22 (FY21: 188 days) owing to a decline in the receivable period to 73 days (110 days), resulting from lower credit period offered to new customers as well as an increase in receipt of receivables from old customers. Furthermore, the payable period increased to 91 days in FY22 (FY21: 79 days) and the inventory holding period reduced to 150 days (157days). The cash flow from operations increased to INR201.3 million in FY22 (FY21: INR126.4 million, FY20: INR175.4 million), due to favorable changes in working capital. However, the ratings are supported by AHL's more than 27 years of operational track record and the promoter Bhavesh Patel's more than 20 years of experience in the pharmaceutical industry. Rating Sensitivities Positive: An increase in the scale of operations, leading to an improvement in the liquidity position and the net leverage reducing below 3.5x on a sustained basis, will lead to a positive rating action. Negative: Deterioration in the EBITDA margin leading to deterioration in the liquidity position or the net leverage remaining above 4.0x or the interest coverage remaining below 1.8x, all on a sustained basis, will lead to a negative rating action. Company Profile Incorporated in 1994, AHL manufactures sterile liquid parenteral in Kheda, Gujarat. The company has presence in the domestic markets and exports to about 77 countries across Africa, Europe, Asia, the Middle East, the US and the UK. ARYAVRAT TRADING: Liquidation Process Case Summary -------------------------------------------------- Debtor: Aryavrat Trading Private Limited Crescent Tower, 229 AJC Bose Road, 5th Fl. Bhowanipure, Kolkata WB 700020 IN Liquidation Commencement Date: September 21, 2022 Court: National Company Law Tribunal, Kolkata Bench Date of closure of insolvency resolution process: September 21, 2022 Insolvency professional: Rachna Jhunjhunwala Interim Resolution Professional: Rachna Jhunjhunwala Vikram Vihar, Block H 493/B/18 G.T. Road Shibpur, Howrah West Bengal 711102 E-mail: jsa.jhunjhunwala@gmail.com - and - Siddha Weston 9 Weston Street Suit No. 134, 1st Floor Kolkata 700013 E-mail: aryavrat.cirp@gmail.com Last date for submission of claims: October 21, 2022 BANSAL SUPER: Ind-Ra Moves BB+ Issuer Rating to Non-Cooperating --------------------------------------------------------------- India Ratings and Research (Ind-Ra) has migrated Bansal Super Market's Long-Term Issuer Rating to the non-cooperating category. The issuer did not participate in the rating exercise despite continuous requests and follow-ups by the agency. Therefore, investors and other users are advised to take appropriate caution while using these ratings. The rating will now appear as 'IND BB+ (ISSUER NOT COOPERATING)' on the agency's website. The instrument-wise rating actions are: -- INR235 mil. Fund-based working capital limits migrated to non- cooperating category with IND BB+ (ISSUER NOT COOPERATING)/ IND A4+ (ISSUER NOT COOPERATING) rating; and -- INR260.21 mil. Term loan due on January 2029 migrated to non- cooperating category with IND BB+ (ISSUER NOT COOPERATING) rating. Note: ISSUER NOT COOPERATING: The ratings were last rated on August 27, 2021. Ind-Ra is unable to provide an update, as the agency does not have adequate information to review the ratings. Company Profile Gujarat-based BSM is a partnership concern that operates a supermarket chain providing food and groceries, general merchandise, including home, furniture, electronics and appliances, and apparels and accessories. BBT ELEVATED: CARE Keeps D Debt Rating in Not Cooperating --------------------------------------------------------- CARE Ratings said the rating for the bank facilities of BBT Elevated Road Private Limited (BERPL) continues to remain in the 'Issuer Not Cooperating' category. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term 1355.00 CARE D; ISSUER NOT COOPERATING; Bank 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 22, 2021, placed the rating(s) of BERPL under the 'issuer non-cooperating' category as BERPL 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. BERPL continues to be noncooperative despite repeated requests for submission of information through e-mails, phone calls and a letter/email dated June 7, 2022, June 17, 2022, June 27, 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). BBT Elevated Road Private Limited (BERPL), incorporated in February 2014, promoted by Riverbank Holdings Pvt. Ltd (RHPL, 90% stake) and Larsen & Toubro Ltd (L&T, 10% stake), as a Special Purpose Vehicle (SPV) to undertake the construction, operation and maintenance of an elevated road of 7.4 Km between Jinzira Bazar and Batanagar on Budge Budge Trunk Road (BBTR) in Kolkata, West Bengal on Public Private Partnership (PPP) model and Design, Build, Operate and Transfer (DBFOT) – Toll basis under Jawaharlal Nehru National Urban Renewal Mission (JnNURM). The total project cost of INR336.25 crore is being financed at a debt equity ratio of 0.65:1. The Concession Agreement (CA) was executed between BBT (Concessionaire) and Kolkata Metropolitan Development Authority (KMDA) on May 28, 2014 for a concession period of 32 years from the appointed date. BP FERRIUM INDUSTRIES: Liquidation Process Case Summary ------------------------------------------------------- Debtor: BP Ferrium Industries Private Limited Plot No. 247, 3rd Floor Dwarakapuri Colony Panjagutta Hyderabad TG 500082 IN Liquidation Commencement Date: July 27, 2022 Court: National Company Law Tribunal, Hyderabad Bench Date of closure of insolvency resolution process: July 21, 2022 Insolvency professional: Mummneni Vazra Laxmi Interim Resolution Professional: Mummneni Vazra Laxmi Flat No. G-2, ENCEE Residency Nagarjuna Nagar Colony Yellarreddyguda Hyderabad 500073 E-mail: emailtolak@gmail.com - and - Flat No. 107, V.V. Vintage Residency Somajiguda, Hyderabad 500082 Last date for submission of claims: August 29, 2022 DAKSHIN BUDHAKHALI: CARE Keeps D Debt Rating in Not Cooperating --------------------------------------------------------------- CARE Ratings said the rating for the bank facilities of Dakshin Budhakhali Improvement Society (DBIS) continues to remain in the 'Issuer Not Cooperating' category. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term 14.11 CARE D; ISSUER NOT COOPERATING; Bank Facilities Rating continues to remain under ISSUER NOT COOPERATING category Detailed rationale and key rating drivers CARE had, vide its press release dated December 05, 2018, placed the ratings of DBIS under the 'issuer non-cooperating' category as DBIS 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. DBIS continues to be noncooperative despite repeated requests for submission of information through e-mails, dated June 13, 2022, June 03, 2022 and May 24, 2022. In line with the extant SEBI guidelines, CARE has reviewed the rating on the basis of the best available information which however, in CARE's opinion is not sufficient to arrive at a fair rating. The rating reaffirmation of the long-term bank facilities of DBIS at CARE D; ISSUER NOT COOPERATING* as the society has been declared as defaulter by one of the Bank. Users of this rating (including investors, lenders and the public at large) are hence requested to exercise caution while using the above ratings. Detailed description of the key rating drivers At the time of last rating on September 29, 2017 the following were the rating strengths and weaknesses (updated for the information available from public domain): Key rating weaknesses * Small scale of operation: DBIS's loan portfolio was small at INR25.15 crore as on Sep 30, 2018 as against to INR14.06 crore as on Mar 31, 2017. However, the scale of operation continues to remain small in comparison to other players operating in this industry. * Concentration of operation in West Bengal: DBIS's operations continue to remain majorly concentrated in West Bengal. * Moderate liquidity profile: Liquidity position has been moderate with positive cumulative mismatches in the short term (upto 1 year) bucket. Key rating strengths * Experienced promoters and management: DBIS was formed in 1995 as a charitable society, and started micro finance operations from 2006. The affairs of the society are managed by Mr. Prasanta Kr. Panda (Secretary) and Ms. Swapna Das (President) along with the support of governing body members. Both Mr. Prasanta Kr. Panda and Ms. Swapna Das have around a decade of experience in the MFI sector. * Improvement in financial performance: DBIS's total operating income increased from INR2.45 crore in FY17 to INR5.65 crore in FY18 driven by healthy increase in loan portfolio during the year. * Adequate capitalization level: DBIS's CAR has improved from 23.92% as on Mar 31, 2017. * Comfortable asset quality: The collection efficiency of DBIS was comfortable at around 99% in FY17. GNPA and NNPA stood at 0.40% & 0.21% respectively as on Mar 31, 2017. Dakshin Budhakhali Improvement Society (DBIS) was formed in 1995 as a charitable society. DBIS started MFI activity from May 2006 by lending to women borrowers engaged in small businesses under 'Self Help Groups' model in rural area of West Bengal. It also provides other technical support services to its borrowers which enables them to achieve self-sustainability. DEEM CONSTRUCTION: CARE Keeps D Debt Rating in Not Cooperating -------------------------------------------------------------- CARE Ratings said the rating for the bank facilities of Deem Construction Company Private Limited continues to remain in the 'Issuer Not Cooperating' category. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term 10.00 CARE D; ISSUER NOT COOPERATING; Bank Facilities Rating continues to remain under ISSUER NOT COOPERATING category Long Term/ 29.00 CARE D/CARE D; ISSUER NOT Short Term COOPERATING; Rating continues Bank Facilities to remain under ISSUER NOT COOPERATING category Short Term 5.00 CARE D; ISSUER NOT COOPERATING; Bank 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 9, 2021, placed the rating(s) of DCCPL under the 'issuer non-cooperating' category as DCCPL 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. DCCPL continues to be non-cooperative despite repeated requests for submission of information through e-mails, phone calls and a letter/email dated May 25, 2022, June 4, 2022, June 14, 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). Jaipur-based (Rajasthan) Deem Construction Company Private Limited (DCPL) was incorporated in 2007 by Mr. Naseem Qureshi along with his family members. DCPL is mainly engaged in the business of construction, installation and commissioning of water supply lines, distribution lines, construction of sewage lines and sewage treatment plants and construction and repair of roads. DCPL is registered 'AA' class (highest in the scale of AA to E) contractor with Public Health Engineering Department (PHED). Further, the company also executes contracts for Rajasthan Urban Infrastructure Development Project (RUIDP). DENEB AUTOMOTIVES: Insolvency Resolution Process Case Summary ------------------------------------------------------------- Debtor: M/s Deneb Automotives Private Limited Building No. 724, Sector-37 Part-II, Gurgaon 122001 Haryana Insolvency Commencement Date: September 22, 2022 Court: National Company Law Tribunal, Chandigarh Bench Estimated date of closure of insolvency resolution process: March 21, 2023 Insolvency professional: Mr. Sunil Kumar Agrawal Interim Resolution Professional: Mr. Sunil Kumar Agrawal E-205, LGF Greater Kailash-II New Delhi 110048 E-mail: aggarwalsk21@yahoo.com - and - 904, GF, Sector-7C Faridabad 121006 E-mail: cirpdenebauto2022@gmail.com Last date for submission of claims: October 6, 2022 DEVI INFRADEVELOPERS: Liquidation Process Case Summary ------------------------------------------------------ Debtor: Devi Infradevelopers Private Limited 116, Anand Nagar Sirsi Road, Vaishali Nagar Jaipur 302021 Liquidation Commencement Date: September 9, 2022 Court: National Company Law Tribunal, Jaipur Bench Date of closure of insolvency resolution process: September 8, 2022 Insolvency professional: Brij Kishore Sharma Interim Resolution Professional: Brij Kishore Sharma AB-162, Vivekanand Marg Nirman Nagar, Ajmer Road Jaipur 302019 Rajasthan E-mail: bksharmal62@gmail.com Last date for submission of claims: October 9, 2022 DURGESHWARI INDUSTRIES: CARE Keeps D Ratings in Not Cooperating --------------------------------------------------------------- CARE Ratings said the rating for the bank facilities of Durgeshwari Industries Limited (DIL) continues to remain in the 'Issuer Not Cooperating' category. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term 15.00 CARE D; ISSUER NOT COOPERATING; Bank 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 2, 2021, placed the rating(s) of DIL under the 'issuer non-cooperating' category as DIL 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. DIL continues to be non-cooperative despite repeated requests for submission of information through e-mails, phone calls and a letter/email dated May 18, 2022, May 28, 2022, June 7, 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). DIL, was initially established in 1994, as a seed processing company under the name Durgeshwari Seeds Private Limited and was further converted into Public Ltd Company under the current name in the year 2011. The operations of the entity are being handled by Mr. Vijay Agrawal and his brothers. The entity operates from its sole manufacturing plant at Parbhani (Maharashtra). EASUN PRODUCTS: Insolvency Resolution Process Case Summary ---------------------------------------------------------- Debtor: Easun Products of India Private Limited Temple Tower 6th Floor 672, Annasalai Chennai 35 Tamil Nadu 600035 IN Insolvency Commencement Date: September 19, 2022 Court: National Company Law Tribunal, Mumbai Bench Estimated date of closure of insolvency resolution process: March 18, 2023 Insolvency professional: Ravindra Chaturvedi Interim Resolution Professional: Ravindra Chaturvedi Parekh Shah & Lodha 31E, BKC Centre Laxmi Industrial Estate New Link Road, Andheri (W) Mumbai City Maharashtra 400053 E-mail: ravinchaturvedi@hotmail.com - and - Flat No. 8, 3rd floor 12/19, Sri Rama Mandiram CP Ramaswarry Street Abhiramapuram Chennai 600018 E-mail: cirp.easunproducts@gmail.com Last date for submission of claims: October 3, 2022 ECLAT INDUSTRIES: Insolvency Resolution Process Case Summary ------------------------------------------------------------ Debtor: Eclat Industries Limited C-30/31, Industrial Area Pataliputra Patna Patna BR 800013 India Insolvency Commencement Date: September 21, 2022 Court: National Company Law Tribunal, Kolkata Bench Estimated date of closure of insolvency resolution process: March 20, 2023 (180 days from commencement) Insolvency professional: Mr. Avishek Gupta Interim Resolution Professional: Mr. Avishek Gupta CK-104, Sector II Salt Lake City Kolkata 700091 E-mail: avishek@optimusresolution.net cirp.eclatindustries@gmail.com Last date for submission of claims: October 5, 2022 EZHIL CHEMICAL: Insolvency Resolution Process Case Summary ---------------------------------------------------------- Debtor: Ezhil Chemical Private Limited No. 2 Sirunangai Main Road Narimanam PO Nagapattinam Distt 611002 Insolvency Commencement Date: September 23, 2022 Court: National Company Law Tribunal, Chennai Bench Estimated date of closure of insolvency resolution process: March 22, 2023 Insolvency professional: Tharuvai Ramachandran Ravichandran Interim Resolution Professional: Tharuvai Ramachandran Ravichandran G3, Block II, Shivani Apartments 40 East Coast Road Thiruvanmiyur, Chennai 600041 E-mail: trravichandran@yahoo.com - and - 27, Third Floor 15 Kasturibai Nagar First Main Road Adyar (above PNB) Chennai 600020 E-mail: ezhilchemcirp@gmail.com Last date for submission of claims: October 7, 2022 GAYATRI PROJECTS: Canara Bank Files Insolvency Plea vs. Company --------------------------------------------------------------- The Economic Times reports that Canara Bank has filed a fresh insolvency petition against Hyderabad based engineering, procurement and construction (EPC) company Gayatri Projects, increasing pressure on the debt-laden borrower that owes lenders more than INR6,000 crore. A failed restructuring plan first initiated in 2015 and subsequent default have marked the account as non- performing asset (NPA) in the books of banks, ET recalls. Canara is the second bank to file an insolvency plea against the company even as a petition by lead lender Bank of Baroda filed in February is awaiting approval from the Hyderabad bench of the National Company Law Tribunal (NCLT). "This is a classic case of why the bankruptcy code has failed to meet expectations. Despite rules saying that the application of financial creditor should be admitted within 14 days, it has been delayed without any reason," ET quotes a person aware of the case as saying. "Meanwhile, the market cap of the company is regularly declining day by day and all banks can do is sell the pledged shares in the open market for a loss." The next date for the hearing in NCLT is October 10, the report discloses. Banks including lead lender BoB have sold pledged shares of the company in the open market, stock market notices showed, ET relays. Some banks have also labelled the account as fraud after evidence was found that the company diverted payments to fictitious subcontractors and never pursued recovery despite contracts getting cancelled. "This company has been found to be diverting funds to entities related to the promoters by multiple forensic audits as a result banks have to make a 100% provision for this account," the person cited above said. "However, the company has filed writ petition in the Telangana High Court against such coercive action by lenders, stalling proceedings." The next date for the High Court case is October 11. Gayatri Projects is promoted by former Rajya Sabha member and film producer T Subbarami Reddy. His wife T Indira Reddy and son TV Sandeep Kumar Reddy are the non-executive chairperson and managing director, respectively, of the company, its website showed. BoB and Canara are the top two lenders to the company with almost identical 30% share of the debt, ET discloses. Other lenders to the company include State Bank of India, Federal Bank, Punjab National Bank, Union Bank of India, Bank of Maharashtra and Indian Overseas Bank. "The company has been promising repayment for the last one year but the intent has been to delay proceedings. A second restructuring proposal by the company last year was rejected because it was not sustainable," ET quotes a second person aware of the account as saying. "Now, with all this delay the unsustainable debt would have gone up. The only hope is that the NCLT will admit this case which will shift the complete management of the company to a neutral resolution professional and banks can take concrete steps for the resolution of the debt." ET notes that lenders are still hopeful that some money can be salvaged from the company because it has ongoing road, water and irrigation projects across the country. There are as many as 32 running projects that offer value to a buyer and could help banks recover some of their debt. Gayatri Projects Ltd. offers construction services. The Company builds infrastructure projects such as dams, highways, bridges, canals, aqueducts, and ports. GINGER INFRASTRUCTURE: CARE Keeps D Debt Rating in Not Cooperating ------------------------------------------------------------------ CARE Ratings said the rating for the bank facilities of Ginger Infrastructure Private Limited (GIPL) continues to remain in the 'Issuer Not Cooperating' category. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term 15.00 CARE D; ISSUER NOT COOPERATING; Bank 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 9, 2021, placed the rating(s) of Ginger Infrastructure Private Limited (GIPL) under the 'issuer non-cooperating' category as GIPL 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. GIPL continues to be noncooperative despite repeated requests for submission of information through e-mails, phone calls and a letter/email dated May 25, 2022, June 4, 2022, June 14, 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). Incorporated in December 19, 2012, GIPL is a Nagpur based special purpose vehicle (SPV) formed by Diamant Infrastructure Limited (DIL) for construction and development of commercial complex at Jaripatka, Nagpur under the name and style of "Ginger Square" to be operated on a built-operate-transfer (B-O-T) basis for a concession period of 30 years commencing from August 2016 and ending in August 2046, with renewal of lease for further period of 30 years. GMR WARORA: Ind-Ra Affirms 'D' NonConvertible Debt Rating --------------------------------------------------------- India Ratings and Research (Ind-Ra) has affirmed GMR Warora Energy Limited's (GWEL) non-convertible debentures' (NCDs) rating at 'IND D'. The detailed rating action is: -- INR750 mil. NCDs (long-term)* affirmed with IND D rating. * Details in annexure Key Rating Drivers The affirmation reflects GWEL's continued delays in debt servicing due to cash flow mismatches during FY22 and 5MFY23. GWEL is implementing a debt restructuring through a resolution plan under the Reserve Bank of India's guidelines pertaining to Prudential Framework for Resolution of Stressed Assets dated June 7, 2019. Ind-Ra will review the rating post the implementation of the resolution plan. Rating Sensitivities Positive: The successful implementation of the resolution plan or timely debt servicing for three successive months will be positive for the rating. ESG Issues ESG Factors Minimally Relevant to Rating: Unless otherwise disclosed in this section, the ESG issues are credit neutral or have only a minimal credit impact on GWEL, due to either their nature or the way in which they are being managed by the entity. For more information on Ind-Ra's ESG Relevance Disclosures, please click here. Company Profile GWEL is a special purpose vehicle incorporated to build, maintain and operate a 600MW (two units of 300MW each) coal-fired, subcritical technology-based thermal power plant in Warora, Maharashtra. GMR Energy Limited is the primary sponsor of the project, with 100% equity investment. GMR Energy is held by GMR Infrastructure Limited (52%), Tenaga Nasional Berhad (30%) and private equity investors (18%). GOODWILL TEA: CARE Keeps D Debt Rating in Not Cooperating --------------------------------------------------------- CARE Ratings said the rating for the bank facilities of Goodwill Tea And Industries Limited (GTIL) continues to remain in the 'Issuer Not Cooperating' category. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term 8.00 CARE D; ISSUER NOT COOPERATING; Bank 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 30, 2021, placed the rating(s) of GTIL under the 'issuer non-cooperating' category as GTIL 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. GTIL continues to be noncooperative despite repeated requests for submission of information through e-mails, phone calls and a letter/email dated June 15, 2022, June 25, 2022, July 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). Goodwill Tea and Industries Limited (GTIL) was incorporated during 1919 by one Mundra family in West Bengal for setting up a business of green/CTC tea plantation, processing and sales. The company has a tea garden in Jalpaiguri, West Bengal, namely Bandiguri Tea Estate which spread over 966 acres of land and a tea manufacturing unit with installed capacity of 16,00,000 kgs per annum. The total green leaf harvested in the year FY19 -20 is 44.17 Kg lakhs. Mr. Arun Kumar Mundra and Ms. Sunita Mundra are the promoters of the company with overall experience of more 30 and 20 years in the tea industry. They are supported by other three directors along with a team of experienced professional who are having long experience in similar line of business. ICE TOUCH: CARE Keeps C Debt Rating in Not Cooperating ------------------------------------------------------ CARE Ratings said the rating for the bank facilities of Ice Touch Resort Private Limited (ITRPL) continues to remain in the 'Issuer Not Cooperating' category. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term 7.00 CARE C; Stable; ISSUER NOT Bank Facilities COOPERATING; Rating continues to remain under ISSUER NOT COOPERATING category Detailed Rationale & Key Rating Drivers CARE Ratings Ltd. had, vide its press release dated July 06, 2021, placed the rating(s) of ITRPL under the 'issuer non-cooperating' category as ITRPL 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. ITRPL continues to be noncooperative despite repeated requests for submission of information through e-mails, phone calls and a letter/email dated May 22, 2022, June 1, 2022, June 11, 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). New Delhi based, Ice Touch Resorts Private Limited (ITRL) was incorporated in 2005. The company is currently promoted by Mr. Ramesh Chander Khanna, Mr. Rakesh Sehgal, Mr. Vinod Nagrath, Mr. Ghanshyam Kapoor and Mr. Rajinder Kumar Malhotra. ITRL is setting up a four-star hotel "Radisson Blu" in Kufri near Shimla. The proposed hotel is being developed on a land parcel of 7,700 sq mtrs. The hotel would consist of 2 main blocks & conference block wherein, the main blocks will consist of 76 deluxe rooms, reception area, lobby, restaurant etc. INDIAN STATE OF KERALA: S&P Affirms 'BB-/B' ICRs, Outlook Stable ---------------------------------------------------------------- On Sept. 29 2022, S&P Global Ratings affirmed its 'BB-' long-term and 'B' short-term issuer credit ratings on the Indian state of Kerala. The outlook on the long-term rating remains stable. Outlook The stable outlook reflects S&P's view that Kerala will continue to benefit from strong access to domestic capital markets and liquidity support from the Indian central bank even as its funding needs remain elevated. Downside scenario S&P may lower the ratings on Kerala if the state fails to gradually consolidate its budget to achieve a projected stabilization of its debt burden at 240%-250% of consolidated operating revenue. Downward pressure could also occur if S&P views the Indian central government to be less likely to provide the state a credit-stability mechanism under a financial stress scenario. This could arise if the central government or RBI becomes more selective in providing support to states. Upside scenario S&P said, "We could raise the ratings if Kerala's economic growth bounces back much faster than we expect and the state's credit metrics improve materially from current levels. The state's deficit in the after-capital account improving to below 25% of revenue would indicate such an improvement. This could result from a much stronger recovery of the economy than we expect, and a combination of stronger revenue streams under a new goods and services tax (GST) regime, higher efficiency of GST collections, and rationalization of expenditure." Rationale Kerala's large deficits resulting from considerable spending on socio-economic programs constrain the ratings on the state. The pandemic had necessitated fiscal measures to stabilize its economy and support the healthcare response. However, as the economy recovers, the state's revenue has also started to improve. In particular, the tourism sector has shown positive traction. This will likely alleviate the budgetary pressure and gradually strengthen the economy over the next four to five years. Kerala's satisfactory financial management supports the recovery momentum. The state's long-term planning and level of transparency and disclosure compare favorably with those of domestic peers. Despite the state's large number of infections, Kerala has managed the health impact of COVID-19 better than domestic peers due to the healthcare infrastructure it has built over the years. The ratings also benefit from Kerala's strong access to domestic capital markets via the RBI's bond auction window. This mitigates the state's lack of internal cash holdings to cover debt servicing. S&P also expects state-specific support from the central government in the event of financial emergency. Strengths in financial management temper a weak economic profile and unbalanced intergovernmental system. The institutional framework of Indian states suffers from a chronic mismatch in revenue and expenditure, and high local and regional government debt. That said, India's intergovernmental structure is mature, with adequate transparency and accountability. The system is built on strong democratic institutions and policy stability. Although the pace of intergovernmental reforms is slow, there is no history of significant policy flip-flops. The poor, albeit improving, productivity of Kerala's economic base constrain its creditworthiness. S&P estimates India's GDP per capita at US$2,457 in 2022. Kerala's economy is wealthier, with a per capita GDP of about US$3,500. Kerala's more educated workforce has raised its per capita productivity to above that of other states in the country. The state's traditionally strong focus on social welfare programs has boosted its development. This is reflected in its high placing on the Human Development Index relative to many other Indian states. S&P Global Ratings forecasts India's GDP will grow by 7.3% this year. It expects Kerala to recover in line with the sovereign. COVID-19 and uncertainties from resurgent waves have immensely shocked the state's economy. As demand for domestic tourism recovers, its revenue should start to improve. S&P expects growth to take off in fiscal 2023 (year-end March) as the economy opens up. S&P continues to assess Kerala's financial management as satisfactory. Policymakers are generally in accord on key development issues, as seen in their coordinated response to COVID-19. Kerala adheres to targets set in its five-year plan, with a focus on infrastructure development, and improving healthcare and educational standards. The re-election of the incumbent government for a successive term in 2021 was unprecedented in the state's political history. S&P believes this will provide continuity in policy directions such as delivering quality public service and economic development. The election result also reflects a favorable public view on the state's handling of the COVID-19 response and overall socio-economic development. Kerala is ahead of all Indian states in the vaccination rate. Like other Indian states, Kerala relies on strong liquidity support from the RBI. The state has weaker debt management than international peers but better than some other domestic states. The bulk of its debt is also on-balance-sheet, with limited off-budget exposure. The results of Kerala's investment in healthcare are visible in the state's response to COVID-19. Notwithstanding a large caseload, the healthcare system has been able to respond better than domestic states, reflecting years of planning and investment. Revenue recovery will cushion large spending requirements and indebtedness that COVID-19 exacerbated. S&P expects Kerala's budgetary performance to gradually improve, albeit from a very large deficit that widened substantially during the pandemic. Large COVID-19-related expenditure and revenue shortfalls due to the economic shutdown in 2020 and 2021 have pushed up the deficits to more than 40% of total revenue. Larger-than-usual transfers from the central government helped temper the revenue shock for Kerala in the past fiscal year. As the state's own revenue rises in tandem with the economic recovery, S&P expects operating deficits to gradually drop to about 6.5% on average in 2022-2024. Its after-capital-account deficit could average about 38.5% of total adjusted revenue over the same period, after spiking to 49.6% in fiscal 2021. Kerala's underdeveloped infrastructure and high demand for public services will continue to constrain its ability to substantially improve budgetary performance to below 25% over the next two to three years, in S&P's view. Kerala's capacity to self-finance is limited. This forces the state to increase debt to deliver basic services. Its fiscal response to support an economic recovery in fiscal 2022 led to a spike in tax-supported debt, to 217% of consolidated operating revenue. We except a continued need for spending to push up this debt to 240% by fiscal 2025. This will keep Kerala's interest burden elevated, averaging 17.5% over 2021-2023. This burden is much higher than that of international peers. S&P said, "We expect state-owned Kerala Infrastructure Investment Fund Board (KIIFB) to push ahead with its project pipeline. This will support the capital expenditure requirements of Kerala, given that the state's own budget remains under strain. We assess Kerala's government-related entities as mostly non-self-supporting. This is because the sector is loss-making. That said, the sector has relatively low indebtedness. "We assess Kerala's liquidity as adequate. Given its large deficits, the state is unable to accumulate cash reserves to improve its internal liquidity. However, India's deep domestic capital market is the state's main avenue for financing. The RBI enhances external liquidity access for Indian states by conducting bond auctions regularly on behalf of state governments." Notwithstanding market volatility, Indian states (including Kerala) have been able to access capital markets in recent months. States in India are not allowed to directly access capital markets themselves. Bond issuances are done on a pooled basis through the RBI, enhancing the states' access to external liquidity. Furthermore, the RBI concludes settlement on behalf of the states, in case a state does not have sufficient funds to make payment on due dates. This suggests very strong liquidity support, in our view. Kerala can rely on the RBI for short-term committed liquidity facilities through ways and means of advances (WMAs), overdrafts, and special drawing facilities. Furthermore, Indian states, including Kerala, have benefited from timely and rule-based debt relief mechanisms from the central government via the Finance Commission. In accordance with S&P's relevant policies and procedures, the Rating Committee was composed of analysts that are qualified to vote in the committee, with sufficient experience to convey the appropriate level of knowledge and understanding of the methodology applicable. At the onset of the committee, the chair confirmed that the information provided to the Rating Committee by the primary analyst had been distributed in a timely manner and was sufficient for Committee members to make an informed decision. After the primary analyst gave opening remarks and explained the recommendation, the Committee discussed key rating factors and critical issues in accordance with the relevant criteria. Qualitative and quantitative risk factors were considered and discussed, looking at track-record and forecasts. The committee's assessment of the key rating factors is reflected in the Ratings Score Snapshot above. The chair ensured every voting member was given the opportunity to articulate his/her opinion. The chair or designee reviewed the draft report to ensure consistency with the Committee decision. The views and the decision of the rating committee are summarized in the above rationale and outlook. The weighting of all rating factors is described in the methodology used in this rating action. Ratings List RATINGS AFFIRMED KERALA (STATE OF) Issuer Credit Rating BB-/Stable/B KERALA INFRASTRUCTURE INVESTMENT FUND BOARD Issuer Credit Rating BB-/Stable/B KERALA INFRASTRUCTURE INVESTMENT FUND BOARD Senior Unsecured BB- INDSIL HYDRO: Ind-Ra Affirms 'D' Long-Term Issuer Rating -------------------------------------------------------- India Ratings and Research (Ind-Ra) has affirmed Indsil Hydro Power and Manganese Limited's (IHPML) Long-Term Issuer Rating at 'IND D'. The instrument-wise rating actions are: -- INR33 mil. Term loan (Long term) due on March 2023 affirmed with IND D rating; -- INR804.7 mil. (reduced from INR825.5 mil.) Fund-based facilities (Long term/Short term) affirmed with IND D rating; and -- INR147.50 mil. Non-fund-based facilities.(Short term) affirmed with IND D rating. ANALYTICAL APPROACH: Ind-Ra has continued to take a consolidated view of IHPML, its two UAE-based 100% subsidiaries, Indsil Hydro Global (FZE) and Indsil Energy Global (FZE), and the Oman-based 50% joint venture company, Al Tamman Indsil Ferro Chrome LLC, to arrive at the ratings, on account of the strong operational and strategic linkages among them. Since FY21, IHPML has not consolidated the revenue, expenses, assets and liabilities from Al Tamman Indsil Ferro Chrome and the interest in the joint venture has been accounted for using the equity method. Key Rating Drivers The affirmation reflects the continued delays in debt servicing by IHPML due to its tight liquidity position and the classification of its account as a non-performing asset by some of its lenders. Rating Sensitivities Positive: Timely debt servicing for three consecutive months could result in an upgrade. Company Profile Incorporated in 1990 and promoted by S N Varadarajan, IHPML manufactures ferro alloys and operates hydro and thermal power plants. The company produces low carbon silicon manganese/medium carbon silicon manganese and ferro chrome from Palakkad, Raipur and Andhra Pradesh plants, respectively. JOVIAL STAINLESS: CARE Keeps D Debt Rating in Not Cooperating ------------------------------------------------------------- CARE Ratings said the rating for the bank facilities of Jovial Stainless Steel and Alloys (JSSA) continues to remain in the 'Issuer Not Cooperating' category. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term 15.00 CARE D; ISSUER NOT COOPERATING; Bank Facilities Rating continues to remain under ISSUER NOT COOPERATING category Detailed Rationale & Key Rating Drivers CARE Ratings Ltd. had, vide its press release dated September 23, 2021, placed the rating(s) of JSSA under the 'issuer non-cooperating' category as JSSA 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. JSSA continues to be noncooperative despite repeated requests for submission of information through e-mails, phone calls and a letter/email dated August 9, 2022, August 19, 2022, August 29, 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). of factual information about company incorporation, name of promoters, products manufactured/services offered and installed capacity. KADAM AND KADAM: CARE Keeps D Debt Ratings in Not Cooperating ------------------------------------------------------------- CARE Ratings said the rating for the bank facilities of Kadam And Kadam Jewellers Private Limited (KKJPL) continues to remain in the 'Issuer Not Cooperating' category. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term/ Short Term Bank Facilities 60.00 CARE D/CARE D; ISSUER NOT COOPERATING; Rating continues to remain under ISSUER NOT COOPERATING category Detailed Rationale & Key Rating Drivers CARE Ratings Ltd. had, vide its press release dated July 14, 2021, placed the rating(s) of KKJPL under the 'issuer non-cooperating' category as KKJPL 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. KKJPL continues to be non-cooperative despite repeated requests for submission of information through e-mails, phone calls and a letter/email dated May 30, 2022, June 9, 2022, June 19, 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). Kadam and Kadam Jewellers Pvt Ltd (KKJPL) was established in the year 2000 in Mumbai by Mr. Nitin Kadam, who is also one of the founder directors of The All India Gems & Jewellery Trade Federation. KKJPL is in the business of manufacturing and trading of gold/silver/diamond studded jewellery and sells them to retailers, wholesalers and traders across India. KKJPL has recently set up a subsidiary company named "Kadam & Kadam International DMCC" in Dubai during FY17. KALYAN JEWELLERS: S&P Withdraws Prelim 'B' Issuer Credit Rating --------------------------------------------------------------- S&P Global Ratings withdrew its preliminary 'B' issuer credit rating on Kalyan Jewellers. At the same time, S&P withdrew the preliminary 'B' issue rating on the proposed senior secured notes to be issued by Kalyan Jewellers FZE and guaranteed by Kalyan Jewellers. In view of the current market conditions, the company has pushed back its plans to access the international debt capital markets. The preliminary ratings were assigned on the condition of a successful issuance of the notes, which did not occur. So the preliminary ratings does not apply. KAMACHI INDUSTRIES: Ind-Ra Affirms 'D' Long-Term Issuer Rating -------------------------------------------------------------- India Ratings and Research (Ind-Ra) has affirmed Kamachi Industries Limited's (KIL) Long-Term Issuer Rating at 'IND D (ISSUER NOT COOPERATING)'. The issuer did not participate in the rating exercise despite continuous requests and follow-ups by the agency. Thus, the rating is based on the best available information. Therefore, investors and other users are advised to take appropriate caution while using these ratings. The instrument-wise rating actions are: -- INR2,119.8 bil. Fund-based working capital limits (Long- term/Short-term) affirmed with IND D (ISSUER NOT COOPERATING) rating; -- INR4,476.8 bil. Non-fund-based working capital limits (Short- term) affirmed with IND D (ISSUER NOT COOPERATING) rating; and -- INR7,131.1 bil. Term loans (Long-term) due on June 2022 affirmed 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 affirmation reflects KIL's continued delays in debt servicing for a period exceeding 30 days. KIL has been classified as a non-performing asset by its lenders. Ind-Ra has not been able to ascertain the reason for the delay, as the issuer has been non-cooperative. Company Profile Incorporated in 2003, KIL manufactures and trades sponge iron, mild steel billets and thermo-mechanically treated bars. The company has an integrated steel plant with facilities to manufacture 120,000 metric tons (MT) of sponge iron, 205,000MT of steel billets and 500,000MT of thermo-mechanically treated bars. It also operates a 10MW waste heat recovery plant and a 70MW thermal power plant. KASHIPUR INFRASTRUCTURE: Ind-Ra Keeps BB Rating in Non-Cooperating ------------------------------------------------------------------ India Ratings and Research (Ind-Ra) has maintained Kashipur Infrastructure and Freight Terminal Private Limited's Long-Term Issuer Rating of 'IND BB (ISSUER NOT COOPERATING)' in the non-cooperating category and has simultaneously withdrawn it. The instrument-wise rating actions are: -- INR390.1 mil. Term loan* due on March 2023 maintained in non- cooperating category and withdrawn; and -- INR50 mil. Working capital limits# maintained in non- cooperating category and withdrawn *Maintained at IND BB (ISSUER NOT COOPERATING) before been withdrawn #Maintained at IND BB (ISSUER NOT COOPERATING)/IND A4+ (ISSUER NOT COOPERATING) before been withdrawn Key Rating Drivers Ind-Ra has maintained the ratings in the non-cooperating category because the issuer did not participate in the rating exercise despite continuous requests and follow-ups by the agency and has not provided information regarding financials, sanctioned bank facilities and utilization, business plans, and projections for the next three years, information on corporate governance, and management certificate. Ind-Ra is no longer required to maintain the ratings, as the agency has received a no-objection certificate from the lenders. This is consistent with the Securities and Exchange Board of India's circular dated March 31, 2017 for credit rating agencies. Ind-Ra will no longer provide analytical and rating coverage for the company. Company Profile Kashipur Infrastructure and Freight Terminal is a joint venture between India Glycols Limited 'IND A'/Stable) and Apollo Logisolutions Limited. It has been set up to operate an inland container depot in Kashipur, Uttarakhand. KERALA INFRASTRUCTURE: S&P Affirms 'BB-/B' ICRs, Outlook Stable --------------------------------------------------------------- S&P Global Ratings affirmed its 'BB-/B' ratings on Kerala Infrastructure Investment Fund Board (KIIFB). The outlook is stable. S&P also affirmed the 'BB-' issue rating on the company's outstanding debt. The stable outlook on KIIFB reflects the long-term rating outlook on the government of Kerala (BB-/Stable/B). It takes into account S&P's view of KIIFB as a strategic policy instrument of the government of Kerala to promote infrastructure financing for at least the next 12-24 months. S&P said, "We may lower the ratings on KIIFB if we see signs of a change in the entity's policy role, a reduction in government support, or a move to significantly lower the government's stake in KIIFB. These could erode the government's obligation or incentive to support the entity. "We may also downgrade KIIFB if we lower the ratings on the government of Kerala. "We may upgrade KIIFB if we raise the ratings on Kerala, and KIIFB continues to perform the same level of service for the state government. "The ratings reflect our expectation that the likelihood of support to KIIFB from the government of Kerala is almost certain, given the entity's critical role and integral link to the state. We believe that KIIFB executes strategic government policies and is a non-severable arm of the Kerala state government. Thus the ratings on KIIFB mirror those on Kerala. In addition, we do not believe the government support is subject to transition risk." The ratings on KIIFB are supported by the board's position as the sole agency for the state to implement strategic infrastructure projects. The ratings benefit from the support KIIFB receives from the government in several forms, including guarantees, capital injections, tax revenue streams for funding, and an escrow mechanism. KIIFB was set up in 1999 as an agency to mobilize funds for capital expenditure on behalf of the Kerala government. After being dormant for more than a decade, the government amended the KIIF Act in 2016 to strengthen oversight, guarantee structure, and controls, with the government intending to use the vehicle in a major way for its infrastructure plans. S&P said, "We view KIIFB's role as critical given that it is the nodal infrastructure-funding agency of the Kerala government, focused on strategic projects that are crucial for the economy. KIIFB's policy role and the terms of operations are spelt out clearly in the KIIF Act. KIIFB has approved infrastructure projects worth Indian rupee (INR) 707 billion to date, of which INR164 billion worth are under construction. To support the state's pandemic-related spending, disbursements by KIIFB for the fiscal year ending March 31, 2022, increased by more than 50% year on year to INR85 billion. We expect KIIFB's role in supporting capital expenditure to be paramount in the coming years for the overall development and growth within the state." There is no clear line of separation between the government of Kerala and KIIFB for infrastructure projects. The state has made public its intention to place all its strategic and large-scale projects with KIIFB. The government's budget has mandated KIIFB as the execution agency across various strategic projects. S&P said, "In our view, KIIFB is integrally linked to the state through the government's tight supervisory control and support in the shape of a statutory guarantee on the company's debt obligations. KIIFB benefits from having all its debt obligations guaranteed by the state under the KIIF Act. The support reflects the government's commitment to expanding the entity's scale and scope of operations. KIIFB continued to receive its share of revenues during the pandemic despite a strain on the state's finances amid a revenue shortfall and elevated spending needs." S&P believes KIIFB's board structure reflects the highest level of commitment and a tight link with the state government. The government appoints KIIFB's CEO and most of the board of directors. KIIFB is the only state government-related entity (GRE) that has the state's chief minister, finance minister, budget secretary, finance secretary, and chief secretary present on the board. The chief minister is the chairman of the board while the minister of finance heads the executive committee. The presence of top government officials heightens the reputational risk for the government if KIIFB were to fail to meet its debt obligations. The CEO is also the chief principal secretary to the chief minister. The government has in place an escrow mechanism to ensure that tax revenue due to KIIFB from the government is received in a timely manner. KIIFB received INR28 billion from the government of Kerala in the shape of a Motor Vehicle Tax and petroleum cess (levy) in the fiscal year ended March 31, 2022. This is on top of ongoing support, mainly through regular capital infusions and loan guarantees. S&P said, "In our view, the safeguards and support mechanisms deployed by Kerala for KIIFB are more than what we have generally observed in state-level government-related entities in India. For example, the Fund Trustee and Advisory Commission (FTAC) is an additional oversight body, besides the usual supervision by the Bureau of Public Enterprises, to ensure that investments of the fund are ring-fenced in line with the intent of the KIIF Act and that there is no diversion of funds. Notably, the three-person FTAC is headed by eminent central officials--a former comptroller and auditor-general of India, a former deputy governor of the Reserve Bank of India (RBI), and a retired executive director of the RBI. "We believe the strength of government support for KIIFB offsets the uncertainties relating to the company's financial position. In our view, KIIFB's importance to the government of Kerala, at least in the next few years, will translate into timely funding support should the entity encounter difficulty in servicing its debt obligations." MICROTEX FASHION: CARE Keeps D Debt Ratings in Not Cooperating -------------------------------------------------------------- CARE Ratings said the rating for the bank facilities of Microtex Fashion Industries (MFI) continues to remain in the 'Issuer Not Cooperating' category. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term 7.23 CARE D; ISSUER NOT COOPERATING; Bank Facilities Rating continues to remain under ISSUER NOT COOPERATING category Detailed Rationale & Key Rating Drivers CARE Ratings Ltd. had, vide its press release dated August 17, 2021, placed the rating(s) of MFI under the 'issuer non-cooperating' category as MFI 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. MFI continues to be non-cooperative despite repeated requests for submission of information through e-mails, phone calls and a letter/email dated July 3, 2022, July 13, 2022, July 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). Valsad-based (Gujarat) MTFI was established in the year 2015 by the proprietor Ms Beena Jayesh Gor, with an objective of manufacturing and trading of linen fabric from flax yarn, which finds application in the textile industry. MTFI commenced trading operations in linen fabric from April 2015 while the manufacturing operations commenced from September 2015 from its sole manufacturing facility located in Valsad (Gujarat) with 48 rapier looms having an installed capacity of about 1.75 lakh metres of linen fabric per month. MTFI procures flax yarn domestically and sells the finished product to retailers and wholesalers located in various cities of India like Ludhiana, Hyderabad, Kanpur etc. MOHAN MOTOR: Liquidation Process Case Summary --------------------------------------------- Debtor: Mohan Motor Dealers Private Limited 9/12, Lalbazar Street Kolkata 700001 Liquidation Commencement Date: September 18, 2022 Court: National Company Law Tribunal, Kolkata Bench Date of closure of insolvency resolution process: May 30, 2022 Insolvency professional: Vaibhav Khandelwal Interim Resolution Professional: Vaibhav Khandelwal 6, Old Post Office Street Temple Chambers, 3rd Floor Room No. 80, Kolkata 700001 E-mail: vaaibhavkkhandelwal@gmail.com mmdpl.liquidator@gmail.com Last date for submission of claims: October 14, 2022 NARAYAN BUILDERS: Ind-Ra Affirms BB- Issuer Rating, Outlook Stable ------------------------------------------------------------------ India Ratings and Research (Ind-Ra) has affirmed Sree Narayan Builders' (SNB) Long-Term Issuer Rating at 'IND BB-'. The Outlook is Stable. The instrument-wise rating action is: -- INR310 mil. (reduced from INR350 mil.) Fund-based facilities affirmed with IND BB-/Stable rating. Key Rating Drivers The affirmation reflects SNB's continued medium scale of operations, as indicated by revenue of INR1334.92 million in FY22 (FY21: INR1974.56 million). The revenue declined because of a disruption in the supply chain due to a major change in suppliers to JSW Steel Limited ('IND AA'/Stable) from Jindal Steel & Power Limited (debt rated 'IND A1+'). The revenue also declined due to increased competition in the segment. SNB recorded a revenue of INR220 million in 1QFY23. Ind-Ra expects SNB's revenue to be stable on a yoy basis in FY23, as demand is likely to be steady. FY22 numbers are provisional in nature. Liquidity Indicator - Stretched: The average maximum utilization of the fund-based limits was 92.08% during the 12 months ended June 2022. The net working capital cycle elongated to 100 days in FY22 (FY21: 58 days) due to an increase in the inventory days to 58 days (22 days). The inventory days increased as the company held stock from both Jindal steel and JSW Steel during the supplier transition. The cash flow from operations remained negative and deteriorated to INR67.55 million in FY22 (FY21: negative INR2.52 million) due to unfavorable changes in the working capital. SNB had cash and cash equivalents of INR16.7 million at FYE22 (FYE21: INR93.97 million). There has not been any substantial withdrawal of capital by the promoters since FY18 and Ind-Ra expects this to continue in the foreseeable future. SNB's disclosure standards are in line with the agency's corporate governance criteria for its rating level; this is likely to continue. The ratings factor in SNB's modest EBITDA margins on account of the intense competition in the industry and trading nature of the business. The EBITDA margins rose to 3.49% in FY22 (FY21:2.3%) due to the higher margins offered by JSW Steel. The ROCE was 10.1% in FY22 (FY21: 11.3%). Ind-Ra expects the margins to remain at similar levels in FY23. The ratings also reflect SNB's modest credit metrics due to the modest margins. The gross interest coverage (operating EBITDA/gross interest expense) improved to 1.6x in FY22 (FY21: 1.45x) due to an increase in the absolute EBITDA to INR46.65 million (INR45.43 million). However, the net leverage (adjusted net debt/operating EBITDAR) deteriorated to 8.03x in FY22 (FY21: 6.42x) due to decrease in the cash reserves to INR16.7 million (INR93.97 million). Ind-Ra expects the credit metrics to be stable in FY23. However, the ratings are supported by the promoters' experience of nearly three decades in the industry, which has helped the firm establish strong relationships with suppliers. Rating Sensitivities Negative: A decline in the scale of operations, leading to deterioration in the credit metrics and/or further weakening of the liquidity profile will be negative for the ratings. Positive: An improvement in the scale of operations, leading to an improvement in the credit metrics and liquidity, with the interest coverage exceeding 1.8x, on a sustained basis, will be positive for the ratings. Company Profile SNB is a distributor of thermo mechanical treatment rods, steels and roof sheets in South-Bengal region, with a presence of over 30 years. It procures materials from suppliers such as Jindal Steel & Power Ltd., JSW Steel Coated Product, and SPS Steel Rolling Mills Ltd., and distributes the same to the dealers. PADMAVATI ASSOCIATES: CARE Keeps C Debt Rating in Not Cooperating ----------------------------------------------------------------- CARE Ratings said the rating for the bank facilities of Padmavati Associates (PA) continues to remain in the 'Issuer Not Cooperating' category. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term 7.00 CARE C; Stable; ISSUER NOT Bank Facilities COOPERATING; Rating continues to remain under ISSUER NOT COOPERATING category Detailed Rationale & Key Rating Drivers CARE Ratings Ltd. had, vide its press release dated August 20, 2021, placed the rating(s) of PA under the 'issuer non-cooperating' category as PA 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. PA continues to be non-cooperative despite repeated requests for submission of information through e-mails, phone calls and a letter/email dated July 6, 2022, July 16, 2022, July 26, 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). Padmavati Associates (PA) was established in the year 2013 as a partnership firm and is promoted by Mr. Y Suresh, Ms. Y Kavitha and Ms. Y D Prasunamba. The firm is engaged in construction of residential apartments and PA is currently implementing its first project; Aakasha Lake View, located at Survey No.225/a, Opp. Mythri Nagar, Beside Kalki Chambers, Allwin Signal, Madinaguda, Miyapur, Hyderabad. PARASHAR COKE: CARE Keeps D Debt Rating in Not Cooperating ---------------------------------------------------------- CARE Ratings said the rating for the bank facilities of Parashar Coke continues to remain in the 'Issuer Not Cooperating' category. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term 74.00 CARE D; ISSUER NOT COOPERATING; Bank 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 29, 2021, placed the rating(s) of PCPL under the 'issuer non-cooperating' category as PCPL 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. PCPL continues to be non-cooperative despite repeated requests for submission of information through e-mails, phone calls and a letter/email dated June 14, 2022, June 24, 2022, July 4, 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). Parashar Coke Private Limited (PCPL) was incorporated in 2006 by Mr. Mithilesh Pandey, Mr. Sanjay Kumar Shah (friend of Mr. Mithilesh Pandey) and Mr. Shiv Nandan Prasad Singh (relative of Mr. Mithilesh Pandey). PCPL has set up a LAMC facility in Saraikela, Jharkhand, having an installed capacity of 224,065 MTPA for coke and 4,573 MTPA for coke fines at a cost of INR115.47 crore. The project was funded at a debt-equity ratio of 1.78:1. PMV MALTINGS: ICRA Keeps B+ Debt Ratings in Not Cooperating ----------------------------------------------------------- ICRA has retained the long-term rating of Pmv Maltings Private Limited in the 'Issuer Not Cooperating' category. The rating is denoted as [ICRA]B+(Stable); ISSUER NOT COOPERATING". Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term- 51.00 [ICRA]B+ (Stable) ISSUER NOT Fund Based- COOPERATING; Rating continues Term Loan to remain under 'Issuer Not Cooperating' category Long Term- 35.00 [ICRA]B+ (Stable) ISSUER NOT Fund Based- COOPERATING; Rating continues Cash Credit to remain under 'Issuer Not Cooperating' category Long Term- 14.00 [ICRA]B+ (Stable) ISSUER NOT Unallocated COOPERATING; Rating continues to remain under 'Issuer Not Cooperating' category ICRA has been trying to seek information from the entity so as to monitor its performance. Further, ICRA has been sending repeated reminders to the entity for payment of surveillance fee that became due. Despite repeated requests by ICRA, the entity's management has remained non-cooperative. The current rating action has been taken by ICRA basis best available/dated/limited information on the issuers' performance. Accordingly, the lenders, investors and other market participants are advised to exercise appropriate caution while using this rating as the rating may not adequately reflect the credit risk profile of the entity. The rating action has been taken in accordance with ICRA's policy in respect of non-cooperation by a rated entity available at www.icra.in. Incorporated in 2008, PMV was a dormant company till the demerger of The Malt Company India Private Limited (MCIPL) with effect from April 2013. Under the demerger scheme, MCIPL handed over two of its units – Pataudi (Haryana) and Kashipur (Uttarakhand) – to PMV, while retaining the Khandsa (Haryana)-based unit. PMV manufactures barley malt with an installed capacity of 30,000 MTPA and 150,000 MTPA at its Pataudi and Kashipur units, respectively. In FY2017, the company reported a profit after tax (PAT) of INR0.59 crore on operating income (OI) of INR139.64 crore compared to a PAT of INR0.41 crore on an OI of INR126.52 crore in the previous year. PRASAD EDUCATION: CARE Keeps D Debt Rating in Not Cooperating ------------------------------------------------------------- CARE Ratings said the rating for the bank facilities of Prasad Education Trust (PET) continues to remain in the 'Issuer Not Cooperating' category. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term 43.82 CARE D; ISSUER NOT COOPERATING; Bank Facilities Rating continues to remain under ISSUER NOT COOPERATING category Detailed Rationale & Key Rating Drivers CARE Ratings Ltd. had, vide its press release dated September 13, 2021, placed the rating(s) of PET under the 'issuer non-cooperating' category as PET 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. PET continues to be non-cooperative despite repeated requests for submission of information through e-mails, phone calls and a letter/email dated July 30, 2022, August 9, 2022, August 19, 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). Uttar Pradesh based PET was established in 1997 with an objective to provide education services. The society is managed by Mr. B. P. Singh (Chairman), Mrs. Anita Yadav (Trustee) and Mr Palash P Yadav (Vice Chairman). PET provides undergraduate and post-graduate courses in various fields of Engineering, Computers Science, Management and Pharma. The college is affiliated to Uttar Pradesh Technical University, Dr. Ram Manohar Lohia Avadh University and is approved by the All India Council for Technical Education (AICTE). The society also operates a CBSE school in the name of Prasad International School providing primary and secondary education from Nursery to class XIIth. The school is affiliated to Central Board of Secondary Education (CBSE). SANGHI INDUSTRIES: Ind-Ra Cuts Long-Term Issuer Rating to 'BB+' --------------------------------------------------------------- India Ratings and Research (Ind-Ra) has downgraded Sanghi Industries Limited's (SIL) Long-Term Issuer Rating to 'IND BB+' from 'IND BBB' and placed the ratings on Rating Watch Negative (RWN). The instrument-wise rating actions are: -- INR7.945 bil. Term loan due on FY31 downgraded; placed on RWN with IND BB+/RWN rating; -- INR3.050 bil. Non-convertible debentures (NCDs) issued on February 23, 2021 ISIN INE999B07036 14/15/16* due on February 23, 2027 downgraded; placed on RWN with IND BB+/RWN rating; -- INR2.850 bil. Fund-based limits downgraded; placed on RWN with IND BB+/RWN rating; and -- INR400 mil. Non-fund-based limits^ downgraded; placed on RWN with IND A4+/RWN rating. ^interchangeable with fund-based limits *first 12 months/13-24 months/25th month onwards The downgrade reflects the worsening of SIL's liquidity cushion owing to the delay in the management's liquidity infusion plan exacerbated by the high input cost environment, leading to a weak profitability. The management is tying up funds by mid-October 2022 to improve the company's liquidity position. The RWN reflects the risks to SIL's credit profile in case of a delay in the consummation of the transaction. Ind-Ra will continue to monitor the progress and timelines of the transaction, and any further delay would be negative for the ratings. Key Rating Drivers Liquidity Indicator - Poor; Delay in Fund Infusion and Cost Headwinds Limit Headroom: After a modest scheduled repayment of INR0.5 billion in FY22 post the debt refinancing in February 2021, SIL has a scheduled debt repayment of around INR0.9 billion in FY23 (including expansion loans which commence repayment from October 2022), for which the company has a limited cushion in the form of internal accruals, given the impact of cost headwinds on profitability. SIL continued to witness a fall in profitability with EBITDA/metric ton (mt) declining sharply to INR309 in 1QFY23 (FY22: INR821, 1QFY22:INR1,100) owing to the doubling of power and fuel cost/mt. Sale volumes (cement and clinker) remained flattish at 0.61million ton (mnt; 1QFY22: 0.60mnt) while cement sale volumes grew 15% yoy after around 20% yoy growth in volumes in April and May 2022. As a result, the overall EBITDA contracted to INR0.2 billion in 1QFY23 (1QFY22: INR0.7 billion). With a weak start to the year and input costs at elevated levels in 2QFY22, Ind-Ra expects SIL's overall EBITDA generation in FY23 to fall short of Ind-Ra's expectations in its last review, despite the cost-reduction measures being taken by the management. Furthermore, SIL's average utilization of its fund-based working capital limits was around 95% during the 12 months ended July 2022 with unused lines of around INR200 million-INR250 million over the last six months ended July 2022. Ind-Ra understands from the management that the company has unused drawable bank lines of around INR250 million in addition to a debt service reserve account of around INR300 million at mid-September 2022, which can be used towards debt servicing if required. The free cash balances remained low at INR1.4 million at FYE22. SIL's cash flow from operations post net interest expense rose to INR3,241 million in FY22 (FY21: INR2,372 million), mainly due to a reduction in working capital owing to an increase in trade payables. The company's ability to manage its working capital would be key to the overall liquidity. Management has been working on various measures to infuse significant funds into the company, which were likely to be completed by August 2022 (after a delay from 1QFY23). The liquidity infusion is likely to be used for the prepayment of high-cost debt and improve its working capital levels to aid the increasing scale of operations. The delay in fruition of these plans coupled with a lower-than-expected internal accruals, leaves limited liquidity headroom. While the company is tying up funds, the infusion is likely only by mid-October as per management. In FY21, the promoters and group company infused unsecured loans of INR71.8 million. Management has been communicating to Ind-Ra that the promoters can readily infuse the required funds in the company to manage any liquidity mismatch. Thus, Ind-Ra will continue to closely monitor the developments on the liquidity infusion plans and any further delay could significantly affect the company's credit profile. Deleveraging Delayed due to Delay in Capex Completion and Stabilization; Volume Ramp-up and Equity Infusion Key to Deleveraging: SIL had completed the capex towards its 3.3mnt clinker and 2mnt grinding unit in Kutch in February 2021 (after a delay of around a year exacerbated by COVID-19), however, the new unit was under stabilization process till 3QFY22 and the limited production had to be blended with production from the existing plant. With the stabilization process and a slow recovery in demand in the western region post COVID-19, SIL's total sales volumes stood at 2.3mnt during FY22 (FY21: 2.1mnt), lower than the annual sales volumes of 2.4-2.9mnt over FY17-FY19. As a result, after improving to 5.7x in FY21, the net leverage (net debt/EBITDA) deteriorated to 7.0x in FY22, due to a decline in the EBITDA to INR1.9 billion (FY21: INR2.4 billion). The capex of around INR16.6 billion over FY19-FY22 (including the expansion) coupled with the production issues faced by the company and the hit on sales demand due to COVID-19 led to the deterioration in the net leverage from a comfortable level of 1.5x in FY18 (FY19: 4.2x, FY20: 6.2x). The new plant was stabilized during 4QFY22. Thus, Ind-Ra expected the volumes and market share to improve over FY23 with the availability of higher capacity and the government's increased focus on infrastructure, along with its sale contracts for domestic sales and export of clinker. However, SIL's operational performance was weak in 1QFY23 and given the continued pressure from high power and fuel costs, ramp-up in volumes and improvement in operating efficiencies are key for growth in EBITDA. Management has informed Ind-Ra that the company has initiated cost-reduction measures by substituting coal with high-quality lignite sourced from Gujarat Mineral Development Corporation Ltd and waste heat recovery system to about half of the requirements, which is likely to partially mitigate the impact of high power and fuel prices. However, with the industry capacity utilizations remaining range bound in FY23, Ind-Ra expects an increase in cement prices to be restricted to a mid-single digit, falling short of the increase in costs due to elevated fuel prices, thereby pressuring the EBITDA/mt. In the absence of liquidity infusion, Ind-Ra expects the net leverage to remain high in FY23. The fructification of liquidity plans could improve the net leverage depending on the debt-equity mix and will be a key rating monitorable. SIL's EBITDA interest coverage (EBITDA/interest expense) deteriorated to 2.3x in FY22 (FY21: 3.3x) due to the decline in EBITDA. The interest coverage is likely to deteriorate further in FY23 as the company stops interest capitalization along with the fact that the NCDs carry a stepped-up interest rate of 14%-16%, higher than other loans. Robust Business Profile despite Limited Geographical Diversification: SIL is the third-largest cement company in Gujarat. Furthermore, its market share is likely to strengthen over the medium term with the smooth operations of the existing plants and a gradual ramp-up of its expanded capacity. The company completed its capex in February 2021, which resulted in a significant increase in its grinding capacity to 6.1mnt from 4.1mnt and clinker capacity to 6.6mnt from 3.3mnt. Management plans to increase its clinker exports, since the capacity has doubled, which is not commensurate with the increase in the grinding capacity. The company also sells cement in the markets of Rajasthan, Maharashtra and Kerala. SIL, post the capex completion, has a 130MW multi-fuel captive thermal power plant and a 13MW waste heat recovery system which fulfil its entire power requirements. Also, SIL has a multi-fuel kiln (pet coke, coal, and lignite), which enables it to switch fuels depending on their prices. Moreover, the company can source lignite at competitive rates, given its proximity to Gujarat Mineral Development Corporation's lignite mines. SIL also has a private jetty for exporting clinkers to countries such as Sri Lanka, the UAE and Africa. The private jetty also assists SIL in accessing other Indian states on the coastal line for clinker sales and import pet coke and coal directly to the plant. While SIL is a strong player in Gujarat, its geographical presence remains limited as the state constitutes 80%-85% of the company's total cement sales. Management expects sales from Kerala and Maharashtra, and the export of clinker to improve over the medium term due to the increased capacity. However, Ind-Ra believes the company will continue to focus on Gujarat market, given its established market position and freight cost advantage. Rating Sensitivities The RWN indicates that the ratings may be either downgraded or affirmed upon resolution. Ind-Ra will review the ratings in mid-October 2022 and resolve the RWN upon completion of the liquidity infusion transaction. Any further delay in liquidity infusion will be negative for the ratings. ESG Issues ESG Factors Minimally Relevant to Rating: Unless otherwise disclosed in this section, the ESG issues are credit neutral or have only a minimal credit impact on SIL, either due to their nature or the way in which they are being managed by the entity. For more information on Ind-Ra's ESG Relevance Disclosures, please click here. Company Profile Incorporated in 1985, SIL has a grinding capacity of 6.1mmtpa and a clinker capacity of 6.6mmtpa. It also has a 130MW captive thermal power plant, captive mines, a water de-salination facility, and a captive port in Kutch which can handle 1mmtpa of cargo. SIL sells ordinary portland cement, portland pozzolana cement and portland slag cement in Gujarat, Rajasthan, Maharashtra and Kerala and international markets of the Middle East, Africa and the Indian sub-continent. SHAKTI BHOG: Insolvency Resolution Process Case Summary ------------------------------------------------------- Debtor: Shakti Bhog Foods Limited 1101-1103, Pearls Business Park Netaji Subhash Place Pitampura, New Delhi 11034 Insolvency Commencement Date: September 22, 2022 Court: National Company Law Tribunal, Principal Bench, New Delhi Estimated date of closure of insolvency resolution process: March 21, 2023 Insolvency professional: Ram Ratan Kanoongo Interim Resolution Professional: Ram Ratan Kanoongo Headway Resolution and Insolvency Services Pvt. Ltd. 708, Raheja Centre Nariman Point Mumbai 400021 Maharashtra E-mail: cirpshakti@gmail.com rrkanoongo@gmail.com Last date for submission of claims: October 6, 2022 SIDDHI VINAYAK: CARE Keeps C Debt Rating in Not Cooperating ----------------------------------------------------------- CARE Ratings said the rating for the bank facilities of Siddhi Vinayak Cottsin (SVC) continues to remain in the 'Issuer Not Cooperating' category. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term 6.50 CARE C; ISSUER NOT COOPERATING; Bank Facilities Rating continues to remain under ISSUER NOT COOPERATING category Detailed Rationale & Key Rating Drivers CARE Ratings Ltd. had, vide its press release dated August 13, 2021, placed the rating(s) of SVC under the 'issuer non-cooperating' category as SVC 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. SVC continues to be non-cooperative despite repeated requests for submission of information through e-mails, phone calls and a letter/email dated June 29, 2022, July 9, 2022, July 19, 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). Established in July 2010, Siddhi Vinayak Cottsin (SVC) is a partnership firm formed by two partners named Mr. Kishanlal Padamdas Swami and Mr. Sanjay Trilokchand Goyal. SVC is engaged into cotton ginning and pressing activity. The partners were primarily engaged in processing of raw cotton and manufacturing and trading of cotton bales and cotton seeds. SVC operates from its sole manufacturing facility located at Ralegaon (Maharashtra) with an installed capacity to process 475 cotton bales per day as on March 31, 2013. In addition to SVC, other associate entities also operate in other cotton processing units named Riddhi Siddhi Cotex Private Limited and Rishi Fibers Private Limited in Ahmednagar district and Aurangabad district of Maharashtra respectively. Furthermore, two proprietorship firms namely Riddhi Siddhi Enterprises and Riddhi Siddhi Cotton Corporation in Sendhwa District of Madhya Pradesh are engaged in trading of cotton bales and cotton seeds. SINHA SQUARE: CARE Keeps D Debt Rating in Not Cooperating --------------------------------------------------------- CARE Ratings said the rating for the bank facilities of Sinha Square (SS) continues to remain in the 'Issuer Not Cooperating' category. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term 9.42 CARE D; ISSUER NOT COOPERATING; Bank Facilities Rating continues to remain under ISSUER NOT COOPERATING category Detailed Rationale & Key Rating Drivers CARE Ratings Ltd. had, vide its press release dated August 11, 2021, placed the rating(s) of SS under the 'issuer non-cooperating' category as SS 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. SS continues to be non-cooperative despite repeated requests for submission of information through e-mails, phone calls and a letter/email dated June 27, 2022, July 7, 2022, July 17, 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). Mr. Anirudh Kumar is setting up a modern and luxury hotel under the name "Sinha Square" in Deoghar, Jharkhand. The hotel has proposed to provide services like multi-cusine restaurant, banquet, swimming pool and conference hall. The hotel is expected to comprise of 60 double bed rooms. The total cost of the project is INR14.75 crore and the same is funded by proprietor contribution of INR4.75 crore and term loan of INR10.00 crore. The project is expected to be completed by March 2019 and the commercial operations expected to start from April 2019. The firm has already invested INR14.00 crore towards land & site development, building, civil works etc. till November 29, 2018 which is met through proprietor's contribution and term loan from bank. The financial closure of the aforesaid term loan has already been achieved. Mr. Anirudh Kumar has three decades of experience in different business like civil construction, mining and roadways. He is proposed to look after the overall management of the hotel, with adequate support from a team of experienced personnel. SOUTH EAST UP: Ind-Ra Withdraws 'D' Sr. Project Bank Loan Rating ---------------------------------------------------------------- India Ratings and Research (Ind-Ra) has withdrawn South East U.P. Power Transmission Company Limited's (SEUPTCL) senior project bank loans' rating as follows: -- The 'IND D' rating on the INR37.132 bil. Senior project bank loans (long-term) is withdrawn. Key Rating Drivers Ind-Ra is no longer required to maintain the ratings, as the agency has received a no-dues certificate from the lender. The agency will no longer provide ratings or analytical coverage for the company. Company Profile Incorporated on September 11, 2009, SEUPTCL was a wholly-owned subsidiary of UP Power Transmission Company Limited (UPPTCL). It was subsequently acquired by Resurgent Power Ventures Pvt Ltd (Resurgent Power) through a competitive bidding process under the Insolvency and Bankruptcy Code, 2016; the acquisition was completed on September 17, 2022. Resurgent Power is a Singapore-based joint venture between Tata Power Company Limited (TPCL, 'IND AA'/Stable), ICICI Bank and investors of international repute. SREEVEN CONSTRUCTIONS: CARE Keeps C Debt Rating in Not Cooperating ------------------------------------------------------------------ CARE Ratings said the rating for the bank facilities of Sreeven Constructions (SC) continues to remain in the 'Issuer Not Cooperating' category. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term 4.40 CARE C; Stable; ISSUER NOT Bank Facilities COOPERATING; Rating continues to remain under ISSUER NOT COOPERATING category Short Term 3.60 CARE A4; ISSUER NOT Bank Facilities COOPERATING; Rating continues to remain under ISSUER NOT COOPERATING category Detailed Rationale & Key Rating Drivers CARE Ratings Ltd. had, vide its press release dated August 23, 2021, placed the rating(s) of SC under the 'issuer non-cooperating' category as SC 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. SC continues to be non-cooperative despite repeated requests for submission of information through e-mails, phone calls and a letter/email dated July 9, 2022, July 19, 2022, July 29, 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). Hyderabad (Telangana) based, Sreveen Constructions (SC) was established in 2013 as Partnership Firm by Mr. J Venkat Reddy, Mr. B Subramanya Reddy and Mr. S Krishna Reddy. The firm is engaged in civil engineering of roads, bridges and buildings for South Central Railways and GVV Constructions (P) Limited. The day-to-day operations of the firm are managed by Mr. J Venkat Reddy who has experience of around 30 years in construction industry and Mr. B Subramanya Reddy. SULABH PHARMACEUTICAL: CARE Keeps D Ratings in Not Cooperating -------------------------------------------------------------- CARE Ratings said the rating for the bank facilities of Sulabh Pharmaceutical Private Limited (SPPL) continues to remain in the 'Issuer Not Cooperating' category. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term 12.00 CARE D; ISSUER NOT COOPERATING; Bank 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 14, 2021, placed the rating(s) of SPPL under the 'issuer non-cooperating' category as SPPL 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. SPPL continues to be noncooperative despite repeated requests for submission of information through e-mails, phone calls and a letter/email dated May 30, 2022, June 9, 2022, June 19, 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). Established in March 2012, Sulabh Pharmaceutical Pvt Ltd. is promoted by Mr. Pravinkumar N. Prajapati and Mrs. Anita P. Prajapati. SPPL is a distributor of pharmaceuticals products especially in western region of Mumbai covering areas upto Mira Road. Furthermore, SPPL manufactures pharmaceutical products (manufacturing contributes to 5% of the business operations) under its brand name on loan and license basis (outsourced) from units situated in Baddi, Himachal Pradesh and distributes the same to various stockists in Mumbai. SPPL has three warehouses situated in Bhiwandi, Thane District, Maharashtra. UMANG BOARDS: Ind-Ra Gives 'BB+' LT Issuer Rating, Outlook Stable ----------------------------------------------------------------- India Ratings and Research (Ind-Ra) has assigned Umang Boards Limited (UBL) a Long-Term Issuer Rating of 'IND BB+'. The Outlook is Stable. The instrument-wise rating actions are: -- INR251.99 mil. Term loan due on July 27 assigned with IND BB+/ Stable rating; -- INR151.1 mil. Fund-based working capital limits assigned with IND BB+/Stable/ IND A4+ rating; and -- INR158.4 mil. Non-fund based working capital limits assigned with IND A4+ rating. Key Rating Drivers The ratings reflect UBL's small scale of operations with its revenue rising to INR763.94 million in FY22 (FY21: INR603.53 million), mainly due to increased demand coupled with the increased efficiency of its unit II that started operations in FY20 for manufacturing super enamelled and paper coated winding wires of copper and aluminum and insulating chemicals. As of 5MFY23, UBL booked a revenue of INR376.1 million and has running orders from its customers, which as per the management, would enable it to achieve a revenue of INR1,000 million in FY23. Ind-Ra expects UBL's revenue to improve in FY23, due to increased demand. The ratings also factor in the UBL's modest EBITDA margin of 13.55% in FY22 (FY21: 18.42%) with a return on capital employed of 7.7% (8.4%). In FY22, the EBITDA margin declined due to the increase in its revenue from its unit II which has lower EBITDA margin. The management plans to focus on its unit I which has higher margins due to its niche nature. For FY23, Ind-Ra expects the EBITDA margin to remain at the similar level due to a likely increase in its unit I production. Liquidity Indicator - Stretched: UBL's net working capital cycle improved but remained elongated at 145 days in FY22 (FY21: 181 days), mainly due to a reduction in its inventory days to 165 days (190 days). The company's average maximum utilization of the fund-based limits was 61.4% and non-fund-based limits was 92.40% during the 12 months ended July 2022. The cash flow from operations improved to INR51.38 million in FY22 (FY21: INR21.45 million) due to lower working capital requirements. Furthermore, its free cash flow stood at INR41.12 million (FY21: INR10.98 million). The cash and cash equivalents stood at INR0.84 million at FYE22 (FYE21: INR0.36 million). UBL does not have any capital market exposure and relies on banks and financial institutions to meet its funding requirements. The ratings also reflect UBL's moderate credit metrics with its gross interest coverage (operating EBITDA/gross interest expenses) improving to 3.16x in FY22 (FY21: 2.44x) and the net leverage (total adjusted net debt/operating EBITDAR) slightly falling to 4.71x (4.73x). In FY22, the credit metrics improved due to a reduction in its debt and interest obligations. For FY23, Ind-Ra expects the credit metrics to improve due to the repayments of its term loans worth INR63.4 million and INR64.8 million for FY24. However, the ratings are supported by the promoters' nearly two decades of experience in manufacturing of insulated paper, leading to established relationships with its customers and suppliers. Rating Sensitivities Negative: A decline in the scale of operations, leading to a deterioration in the overall credit metrics and/or further pressure on the liquidity position, could lead to a negative rating action. Positive: An increase in the scale of operations, along with an improvement in the overall credit metrics with the net leverage remaining below 3.5x and an improvement in the liquidity profile, all on a sustained basis, could lead to a positive rating action. Company Profile Incorporated in 1999, Jaipur-based UBL manufactures cellulose-based insulations, super enamelled and paper coated winding wires of copper and aluminum and insulating chemicals. Its products being used in the transformer industry. V AND S INTERNATIONAL: CARE Keeps D Ratings in Not Cooperating -------------------------------------------------------------- CARE Ratings said the rating for the bank facilities of V And S International Private Limited (VSIPL) continues to remain in the 'Issuer Not Cooperating' category. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term 34.50 CARE D; ISSUER NOT COOPERATING; Bank Facilities Rating continues to remain under ISSUER NOT COOPERATING category Short Term 0.50 CARE D; ISSUER NOT COOPERATING; Bank 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 06, 2021, placed the rating(s) of VSIPL under the 'issuer non-cooperating' category as VSIPL 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. VSIPL continues to be noncooperative despite repeated requests for submission of information through e-mails, phone calls and a letter/email dated May 22, 2022, June 1, 2022, June 11, 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). Delhi based, V and S International (VSI) was incorporated on August 14, 1992. VSI is currently being managed by Mr. Chander Parkash Gauba and Mrs. Neeta Gauba with the help of qualified management. VSI is engaged in manufacturing, dyeing and knitting of fabric and manufacturing of readymade garments. The manufacturing facility is located in Gurgaon, Haryana. VANI ORGANICS: CARE Keeps C Debt Rating in Not Cooperating ---------------------------------------------------------- CARE Ratings said the rating for the bank facilities of Vani Organics Private Limited (VOPL) continues to remain in the 'Issuer Not Cooperating' category. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term 6.50 CARE C; ISSUER NOT COOPERATING; Bank 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 23, 2021, placed the rating(s) of VOPL under the 'issuer non-cooperating' category as VOPL 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. VOPL continues to be non-cooperative despite repeated requests for submission of information through e-mails, phone calls and a letter/email dated June 8, 2022, June 18, 2022, June 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). Vani Organics Private Limited (VOPL) belongs to Vani Group based out of Hyderabad promoted by Late Mr. Subba Rao. The Group commenced its business by incorporating Vani Pharma Labs Limited (VPL) in the year 1976 which is the flagship company of the group and engaged in manufacturing of Active Pharmaceutical Ingredients (APIs) and bulk drugs. In 1984, the group expanded its production facilities by incorporating VOPL in Bidar, Karnataka, to manufacture bulk drugs. VENTURE POWER: Liquidation Process Case Summary ----------------------------------------------- Debtor: Venture Power Systems India Private Limited Plot D6 Phase II, Zone B MEPZ Tambaram, Chennai TN 600045 IN Liquidation Commencement Date: September 12, 2022 Court: National Company Law Tribunal, Chennai Bench Court-II Date of closure of insolvency resolution process: September 11, 2022 Insolvency professional: Thilagar Murugesan Interim Resolution Professional: Thilagar Murugesan 28/532, Lifestyle Apartment Perundurai Road Erode 638011 Tamilnadu 638011 E-mail: mthilagar@tacas.org Last date for submission of claims: October 14, 2022 VRJ TRADERS PRIVATE: Liquidation Process Case Summary ----------------------------------------------------- Debtor: VRJ Traders Private Limited 2, Press Enclave Road Saket, New Delhi 110017 Liquidation Commencement Date: September 13, 2022 Court: National Company Law Tribunal, New Delhi Bench Court-VI Date of closure of insolvency resolution process: June 20, 2022 Insolvency professional: Alok Kumar Kuchhal Interim Resolution Professional: Alok Kumar Kuchhal C-154, Sector-51 Noida, Uttar Pradesh 201301 E-mail: akkuchhal.ip@gmail.com vrjtraders.cirp@gmail.com Last date for submission of claims: October 12, 2022 ========= J A P A N ========= TOSHIBA CORP: Bidders Narrowed Down to Two Company Groups --------------------------------------------------------- The Japan Times reports that Toshiba Corp. has received bids for rebuilding the conglomerate from two groups of companies, one led by state-backed fund Japan Investment Corp. and another by Tokyo-based fund Japan Industrial Partners Inc., sources familiar with the matter have said. With Sept. 30 being the deadline for the second round of bidding following the first in July, potential buyers of the troubled conglomerate have been narrowed down to the two groups, the report says. According to The Japan Times, Japan Investment has partnered with U.S. investment fund Bain Capital, while Japan Industrial Partners has formed an alliance with European fund CVC Capital Partners, with both of them eyeing delisting Toshiba, the sources said. The company will consider the proposals by the two groups in light of financials and other aspects, then negotiate with them over the next several months, according to the sources. The Japan Times relates that the conglomerate said Sept. 30 it has received multiple bids without detailing the number. Since the first round of bidding in July, the number of potential bid participants had been narrowed down to four, including Japan Investment and Bain Capital, the report notes. The company's plight began with an accounting scandal in 2015, followed by the 2017 bankruptcy of its U.S. nuclear plant subsidiary Westinghouse Electric Co. A series of management woes have further tarnished its corporate image, the report notes. In 2021, Toshiba executives were found to have colluded with the Ministry of Economy, Trade and Industry to prevent foreign activist shareholders from influencing the board by sending in directors, leading its shareholders to vote out some of the board members at the time. About Toshiba Corp. Toshiba Corporation (TYO:6502) -- http://www.toshiba.co.jp/-- manufactures and markets electrical and electronic products. The Company's products include digital products such as PCs and televisions, NAND flash memories, and system LSIs (large-scale integrated), as well as social infrastructures such as power generators, medical equipment, and home appliances. As reported in the Troubled Company Reporter-Asia Pacific on April 1, 2022, S&P Global Ratings has affirmed its 'BB+' long-term issuer credit rating and 'B' short-term issuer and issue credit ratings on Toshiba Corp. S&P removed the long-term issuer credit rating from CreditWatch with negative implications, on which S&P placed it on Nov. 16, 2021. The outlook is negative. ===================== N E W Z E A L A N D ===================== DOGTAG (2018): Creditors' Proofs of Debt Due on Oct. 19 ------------------------------------------------------- Creditors of Dogtag (2018) Limited are required to file their proofs of debt by Oct. 19, 2022, to be included in the company's dividend distribution. The company commenced wind-up proceedings on Sept. 20, 2022. The company's liquidators are: Steven Khov Kieran Jones Khov Jones Limited PO Box 302261 North Harbour Auckland 0751 LUSCIOUS LIVING: BDO Tauranga Appointed as Liquidators ------------------------------------------------------ Thomas Lee Rodewald and Paul Thomas Manning of BDO Tauranga Limited on Sept. 20, 2022, were appointed as liquidators of Luscious Living Botany Limited. The liquidators may be reached at: Level 1, The Hub 525 Cameron Road PO Box 15660 Tauranga 3144 TFS 2012: Court to Hear Wind-Up Petition on Oct. 10 --------------------------------------------------- A petition to wind up the operations of TFS 2012 Limited will be heard before the High Court at Napier on Oct. 10, 2022, at 2:15 p.m. The Commissioner of Inland Revenue filed the petition against the company on June 17, 2022. The Petitioner's solicitor is: Emily Rebecca Erin O'Sullivan Legal Services, 11 Jepsen Grove Wallaceville Upper Hutt 5018 WE FENCE: Court to Hear Wind-Up Petition on Oct. 25 --------------------------------------------------- A petition to wind up the operations of We Fence Limited will be heard before the High Court at Hamilton on Oct. 25, 2022, at 10:45 a.m. Carters Building Supplies Limited filed the petition against the company on July 22, 2022. The Petitioner's solicitor is: Philip John Morris Stace Hammond Lawyers KPMG Building, Level 7 85 Alexandra Street Hamilton 3240 WELDERS & STEEL: Court to Hear Wind-Up Petition on Oct. 10 ---------------------------------------------------------- A petition to wind up the operations of Welders & Steel Structures (2009) Limited will be heard before the High Court at Napier on Oct. 10, 2022, at 2:15 p.m. The Commissioner of Inland Revenue filed the petition against the company on July 4, 2022. The Petitioner's solicitor is: Emily Rebecca Erin O'Sullivan Legal Services, 11 Jepsen Grove Wallaceville Upper Hutt 5018 ===================== P H I L I P P I N E S ===================== MACTAN APPARELS: 4,000 Workers From 5 MEPZ Firms Lose Jobs ---------------------------------------------------------- Cebu Daily News reports that around 4,000 workers from five locators of Mactan Export Processing Zone (MEPZ) in Lapu-Lapu City, which engaged in manufacturing clothes have lost their jobs after they were retrenched by these firms. In their official statement, the five MEPZ firms explained that the downsizing of workers was needed since the world was now on the brink of a global recession, CDN relays. "As the world is now on the brink of global recession, with higher than expected inflation and the global financial conditions are becoming tighter, our business and that of our customers are not an exemption especially being classified as a non-essential luxury product," read their statement. Among the locators, who implemented a retrenchment program, were Mactan Apparels, Inc.; Metro Wear, Inc; Globalwear Manufacturing, Inc.; Feeder Apparel Corporation; and Vertex OOne Apparel Phils. Inc., CDN discloses. According to CDN, the locators also explained that their financial health was also affected by the COVID-19 pandemic, the onslaught of super typhoon Odette, supply chain issues, increasing gas prices, and the conflict war between Russia and Ukraine, which has resulted in their unstable operations. "The sudden dropping and reduction of orders from our clients while increasing operational costs left us to face head-on to deal with the economic struggles and financial shortage; thus, our company perceived objectively and in good faith the need to downsize our current manpower through a retrenchment program," it added. The retrenchment program will also help to keep their business afloat and continue the employment of 75 percent of their workforce, CDN relays. The total workforce of the five locators is more than 18,000. "The affected workers shall receive a separation pay in accordance with the law," the official statement said, adding that they were grateful to the contributions of those affected workers. ================= S I N G A P O R E ================= SEA GROUP: Shopee Cuts Jobs in Malaysia --------------------------------------- Tech in Asia reports that ecommerce titan Shopee has slashed jobs in Malaysia following a retrenchment round in three other countries. People familiar with the matter told Tech in Asia that an announcement by senior management was made during a town hall on Sept. 26. A source who was affected by the job cuts couldn't confirm the number of employees who were laid off, but they told us that some of their affected peers came from the business development, marketing, and customer service departments. Another source told Tech in Asia that the layoff announcement was part of earlier round of retrenchments. According to Tech in Asia, the delay for Malaysia was due to the scale and size of the exercise, the source said, but they added that cuts "remain in the low single-digit percentage across all teams affected." In a statement, Shopee said that like the exercise two weeks ago, the Malaysia cuts are part of ongoing efforts to "optimize operating efficiency with the goal of achieving self-sufficiency across our business," the report relays. September has been a rough month for Shopee, Tech in Asia notes. On September 19, Indonesian business portal Kumparan reported that the company will be laying off staff in Singapore, China, and Indonesia, dismissing 180 employees in total. An undisclosed number of employees in Taiwan and the Philippines were also recently let go, the report says. Earlier this month, the ecommerce platform closed operations in Argentina, Chile, Colombia, and Mexico. Shopee's parent firm, Sea Group, has also announced belt-tightening measures, reports Tech in Asia. Citing an internal memo to staff sent by CEO Forrest Li, Bloomberg reported on September 15 that the group revised company expense guidelines with the top management forgoing salaries until self-sufficiency was achieved, Tech in Asia relays. Mr. Li added that for business travel, Sea staff would stick to economy class. Travel and hotel stay expenses would also be limited to US$30 and US$150 per day, respectively. About Sea Limited Headquartered in Singapore, Sea Limited, together with its subsidiaries, engages in the digital entertainment, e-commerce, and digital financial service businesses in Southeast Asia, Latin America, rest of Asia, and internationally. It offers Garena digital entertainment platform for users to access mobile and PC online games, as well as eSports operations; and access to other entertainment content, including livestreaming of gameplay and social features, such as user chat and online forums. The company also operates Shopee e-commerce platform, a mobile-centric marketplace that provides integrated payment and logistics infrastructure and seller services. In addition, it offers SeaMoney digital financial services to individuals and businesses, including offline and online mobile wallet, and payment processing services, as well as other offerings across credit, insurtech, and digital bank services under the ShopeePay, SPayLater, SeaBank, and other digital financial services brands; and payment processing services for Shopee. The company was formerly known as Garena Interactive Holding Limited and changed its name to Sea Limited in April 2017. Sea Limited reported annual net losses of US$1.46 billion, US$1.61 billion and US$2.04 billion for the years ended Dec. 30, 2019, 2020 and 2021, respectively. UNIQUE REALTY: Creditors' Proofs of Debt Due on Oct. 30 ------------------------------------------------------- Creditors of Unique Realty Pte Ltd are required to file their proofs of debt by Oct. 30, 2022, to be included in the company's dividend distribution. The company commenced wind-up proceedings on Sept. 23, 2022. The company's liquidator is Mr. Tan Chin Ren of Tan, Chan & Partners. VANTERES PTE: Commences Wind-Up Proceedings ------------------------------------------- Members of Vanteres Pte Ltd, on Sept. 26, 2022, passed a resolution to voluntarily wind up the company's operations. The company's liquidator is Ms. Valerie Lim Lee Huang. WAN CHUNG: Foo Kon Tan Appointed as Liquidators ----------------------------------------------- Messrs. Kon Yin Tong and Aw Eng Hai of Foo Kon Tan on Sept. 19, 2022, were appointed as liquidators of Wan Chung Construction (Singapore) Pte Ltd. The liquidators may be reached at: Foo Kon Tan LLP 24 Raffles Place #07-03 Clifford Centre Singapore 048621 WATERVILLE INVESTMENT: Creditors' Proofs of Debt Due on Oct. 31 --------------------------------------------------------------- Creditors of Waterville Investment Pte Ltd are required to file their proofs of debt by Oct. 31, 2022, to be included in the company's dividend distribution. The company commenced wind-up proceedings on Sept. 27, 2022. The company's liquidators are: Leow Quek Shiong Gary Loh Weng Fatt Seah Roh Lin c/o BDO Advisory Pte. Ltd. 600 North Bridge Road #23-01 Parkview Square Singapore 188778 WAYNE BURT: Creditors' Proofs of Debt Due on Oct. 14 ---------------------------------------------------- Creditors of Wayne Burt Pte. Ltd. are required to file their proofs of debt by Oct. 14, 2022, to be included in the company's dividend distribution. The company's liquidator is: Farooq Ahmad Mann No. 3 Shenton Way #03-06C Shenton House Singapore 068805 ================= S R I L A N K A ================= AMANA BANK: Fitch Maintains 'BB+(1ka)' Rating on Watch Neg. ----------------------------------------------------------- Fitch Ratings has maintained the Rating Watch Negative (RWN) on Amana Bank PLC's National Long-Term Rating of 'BB+(lka)'. KEY RATING DRIVERS Downside Risks Significant: The RWN on Amana's National Long-Term Rating reflects potential for deterioration in the bank's creditworthiness relative to other entities on the Sri Lankan national ratings scale, given the heightened stress on the bank's funding and liquidity, which raises risks to its overall credit profile. Fitch believes that the sharp rise in inflation, depreciation of the local currency and other economic stresses can distort the bank's underlying financial position in the current operating environment. Weakening Operating Environment: Its assessment of Sri Lankan banks' operating environment (OE) reflects the pressure on the banks' already stressed credit profiles following the sovereign's default on its foreign-currency obligations. It also captures the rapid deterioration in the broader economy, including increased interest rates, very high inflation and acute currency depreciation. The economic stress has limited Amana's operational flexibility. Economic Volatility Weighs on Business Model: Fitch believes that Amana's business profile, like that of most domestic peers, is highly vulnerable to the intensifying risks in the domestic market, given the high concentration of its business on the weak and unstable Sri Lankan economy. This, in turn, could limit the bank's ability to generate and defend business volume while controlling risks. High Risk Profile: Amana's elevated risk profile, similar to local peers, is mainly the result of the very challenging OE. In addition, Amana has material exposure to high-risk SME and retail customer segments that have weak credit quality, although it has no exposure to distressed government securities. That said, Fitch believes that the bank is not immune to the second-order effects of any risks to the banking sector, given the sector's considerable exposure to the sovereign's weak credit profile. Rising Pressure on Credit Quality: Fitch expects Amana's impaired (stage 3) loan ratio to rise sharply in the near to medium term as borrower repayment capacity weakens following the rapid deterioration of the economy. That said, the rise in the ratio will depend on the extent of economic instability, the bank's impaired-loan recognition policies and exchange rate volatility, among others. Profitability to Deteriorate: Fitch expects Amanas profitability to remain under significant pressure in the near to medium term due to higher credit and operational costs. The bank's operating profit/risk-weighted asset (RWA) ratio improved marginally to 1.8% in 1H22 from 1.6% in 2021, but it remained lower than the peer bank median of 2.1%. Cost pressures are likely to increase due to high inflation. Capital Impairment Risk: Pressure on Amana's capitalisation stems primarily from its loan portfolio as the bank does not hold any sovereign foreign-currency securities, which are in default. Fitch expects increased asset-quality risks and weaker earnings retention to exert significant pressure on the bank's capitalisation metrics in the near term. The bank's reported common equity Tier 1 ratio decreased to 13.4% by end-1H22 from 13.7% at end-2021. Strained Foreign-Currency Liquidity: Fitch believes Amana's foreign-currency funding and liquidity position is under stress and vulnerable to sudden shocks. The bank's ability to seek funding through wholesale, institutional and foreign-currency funding is highly stretched due to the sovereign's default on its foreign-currency obligations, and the bank has had to rely on limited flows of remittances and exporter proceeds to meet its foreign-currency obligations. RATING SENSITIVITIES Factors that could, individually or collectively, lead to negative rating action/downgrade: The RWN reflects rising risks to the bank's rating from funding stresses, which could lead to a multiple-notch downgrade. Fitch expects to resolve the RWN once the impact on the issuer's credit profile becomes more apparent, which may take more than six months. Developments that could lead to a multiple-notch downgrade include: - funding stress that impedes Amana's repayment ability - significant banking-sector intervention by the authorities that constrains the bank's ability to service its obligations - a temporary negotiated waiver or standstill agreement following a payment default on a material financial obligation - Fitch's belief that Amana has entered into a grace or cure period following non-payment of a material financial obligation. A downgrade of the sovereign's Long-Term Local-Currency Issuer Default Rating (CCC and under criteria observation) could also lead to a downgrade of the bank's rating. Factors that could, individually or collectively, lead to positive rating action/upgrade: There is limited scope for upward rating action given the RWN. HOUSING DEVELOPMENT: Fitch Keeps 'BB+(1ka)' Rating on Watch Neg. ---------------------------------------------------------------- Fitch Ratings has maintained the Rating Watch Negative (RWN) on Housing Development Finance Corporation Bank of Sri Lanka's (HDFC) National Long-Term Rating of 'BB+(lka)'. KEY RATING DRIVERS Risks Remain Significant: The RWN on HDFC's National Long-Term Rating reflects potential for deterioration in the bank's creditworthiness relative to other entities on the Sri Lankan national ratings scale, given the heightened stress on the bank's funding and liquidity. The risk is exacerbated by the sovereign's credit profile (Long-Term Foreign-Currency Issuer Default Rating (IDR): RD, Long-Term Local-Currency IDR: CCC (UCO)) and the ensuing risks to the stability of the financial system. Fitch also believes that the sharp rise in inflation, depreciation of the local currency and other economic stresses can distort the bank's underlying financial position in the current operating environment. Elevated Liquidity Risk: Fitch expects HDFC funding and liquidity profile to be exposed to dislocations in funding markets and highly volatility in local-currency markets as a result of the weakened sovereign profile. The bank's liquidity was stretched, as reflected in its loan/customer deposit ratio, which increased to 93.6% by end-1H22 from 87.5% at end-2021 due to high deposit withdrawals. Additionally, HDFC's high asset and liability mismatches, reflecting its longer-tenor loan book and short-tenor deposit base, could also intensify the bank's liquidity risk. Weakening Operating Environment: Its assessment of Sri Lankan banks' operating environment (OE) reflects the pressure on the banks' already stressed credit profiles following the sovereign's default on its foreign-currency obligations. It also captures the rapid deterioration in the broader economy, including increased interest rates, very high inflation and acute currency depreciation. The economic stress has limited HDFC's operational flexibility. Heightened Asset-Quality Risk: Fitch expects HDFC's asset quality metrics to deteriorate in 2022 given the bank's exposure to more vulnerable low-to-middle income earners amid the weakening OE. Rising interest rates, high inflation and the contracting economy will likely rapidly undermine the repayment capacity of corporates and household. HDFC's stage 3 loan ratio, excluding loans backed by Employee Provident Fund (EPF) contributions, climbed to 19% by end-1H22 from 15% at end-2021. Capital Vulnerable to Moderate Shocks: Its assessment of HDFC's capitalisation captures its relatively small capital base (LKR6.7 billion at end-1H22), and its limited access to capital due to the state's weakened ability to participate in the bank's capital through rights issues. This has exposed HDFC's capitalisation to profitability and asset-quality shocks more than its peers. Fitch estimates that additional capital of around LKR800 million would be needed for HDFC to meet the enhanced regulatory capital threshold of LKR7.5 billion by the extended deadline of end-2023, and internal capital generation may not be adequate to address this shortfall. Notwithstanding that, HDFC's reported common equity tier 1 (CET1) ratio of 24.3% at end-1H22 remains significantly higher than the peer median of 14.7%. Increased Pressure on Profitability: Fitch expects HDFC's profitability to come under increased pressure in 2022 due to rising credit costs, high inflation and muted loan growth. The bank's operating profits/risk-weighted assets ratio fell to 4.0% by end-1H22 from 4.2% at end-2021due to increased credit and operational costs. However, HDFC's profitability continued to be higher than peers' (peer average for 1H22: 1.2%), benefiting from lower risk density due to EPF-backed loans and mortgage-backed housing loans, which are risk-weighted at 0% and 50%, respectively. Economic Volatility Weighs on Business Model: Fitch believes that HDFC's business profile, like most domestic peers, is highly vulnerable to the intensifying risks in the domestic market given its high exposure to the weak and unstable Sri Lankan economy. This, in turn, could limit the bank's ability to generate and defend business volume while controlling risks. Elevated Risk Profile: HDFC's elevated risk profile, similar to local peers, stems from its exposure to Sri Lanka's stressed economy. In addition, its main exposure is to high-risk customer segments with weak credit quality, although HDFC has no exposure to defaulted foreign-currency government securities. However, the bank is still exposed to the risk of market dislocation or tighter local-currency markets as a result of measures to improve government's debt sustainability. HDFC's exposure to local-currency government bonds was around 11% of total assets at end-2021. RATING SENSITIVITIES Factors that could, individually or collectively, lead to negative rating action/downgrade: The RWN reflects rising risks to the bank's rating from funding stresses, which could lead to a multiple-notch downgrade. Fitch expects to resolve the RWN once the impact on the bank's credit profile becomes more apparent, which may take more than six months. Developments that could lead to a multiple-notch downgrade include: - funding stress that impedes HDFC's repayment ability - banking-sector intervention by the authorities that constrains the bank's ability to service its obligations - a temporary negotiated waiver or standstill agreement following a payment default on a material financial obligation - Fitch's belief that HDFC has entered into a grace or cure period following non-payment of a material financial obligation. A downgrade of the sovereign's Long-Term Local-Currency Issuer Default Rating could also lead to a downgrade of the bank's rating. Factors that could, individually or collectively, lead to positive rating action/upgrade: There is limited scope for upward rating action, given the RWN. OTHER DEBT AND ISSUER RATINGS: KEY RATING DRIVERS HDFC's outstanding senior unsecured debentures are rated at the same level as its National Long-Term Rating in accordance with Fitch's criteria. This is because the issue ranks equally with the claims of the bank's other senior unsecured creditors. OTHER DEBT AND ISSUER RATINGS: RATING SENSITIVITIES The ratings of the senior unsecured debentures will move in tandem with HDFC Bank's National Long-Term Rating. SANASA DEVELOPMENT: Fitch Keeps 'BB+(1ka)' Rating on Watch Neg. --------------------------------------------------------------- Fitch Ratings has maintained the Rating Watch Negative (RWN) on SANASA Development Bank PLC's (SDB) National Long-Term Rating of 'BB+(lka)'. KEY RATING DRIVERS Risks Remain Significant: The RWN on SDB's National Long-Term Rating reflects potential for deterioration in the bank's creditworthiness relative to other entities on the Sri Lankan national ratings scale, given the heightened stress on the bank's funding and liquidity. The risk is exacerbated by the sovereign's credit profile (Long-Term Foreign-Currency Issuer Default Rating (IDR): RD; Long-Term Local-Currency IDR: CCC (UCO)) and the ensuing risks to the stability of the financial system. Fitch also believes that the sharp rise in inflation, depreciation of the local currency and other economic stresses can distort the bank's underlying financial position in the current operating environment. Heavy Reliance on Wholesale Funding: Fitch views SDB's funding profile to be highly susceptible to changes in investor confidence in a weakening operating environment (OE) given the bank's higher reliance on wholesale funding than peers. SDB's loan/deposit ratio fell marginally to 119.4% by end-1H22 from 123.3% at end-2021 due to muted loan growth, but it remained higher than the peer median of 96%, reflecting the lower 67.6% share of deposits in SDB's funding mix compared with the peer median of 86% in 1H22. The bank has accessed funding from foreign development-finance agencies in the past to support its business model of serving the rural and underbanked communities in Sri Lanka, but accessing fresh funding could remain under pressure due to the weakened sovereign profile. Weakening Operating Environment: Its assessment of Sri Lankan banks' OE reflects the pressure on the banks' already stressed credit profiles following the sovereign's default on its foreign-currency obligations. It also captures the rapid deterioration in the broader economy, including increased interest rates, very high inflation and acute currency depreciation. The economic stress has limited SDB's operational flexibility. Pressure on Asset Quality: Fitch expects increased pressure on SDB's asset quality, similar to peers, in 2022, which is likely to extend into 2023 due to the weak OE. SDB's stage 3 loan/gross loan ratio increased to an estimated 8.0% by end-1H22 from 6.4% at end-2021. High interest rates and inflation, together with the economic slowdown, will hurt the borrowers' repayment capacity in the medium term, weakening the quality of the overall loan book. Moderate Capital Buffers: Fitch expects moderate pressure on SDB's capital ratio in 2022 and 2023 with weak internal capital generation, particularly as we expect marginal losses in 2022 and an increase in risk-weighted assets (RWAs) as the credit quality of assets weakens. The bank's reported common equity Tier 1 (CET1) capital ratio stood at 13.4% at end-1H22, up from 9.8% at end-2020 after a LKR3.6 billion capital infusion through a secondary public offering. The capital infusions were prompted by the need to replenish the bank's capital buffers. Profitability to Decline Further: SDB's operating profit/RWA ratio fell to 0.7% by end-1H22 from 1.8% at end-2021 due to high credit costs and narrowed net interest margins. Fitch expects further pressure on operating profitability in the medium term due to rising credit costs, the impact of inflation on the bank's already high operating costs and narrowing net interest margins due to muted loan growth and high funding costs. Any increase in taxation will hurt the bank's bottom-line profitability. Economic Volatility Weighs on Business Model: Fitch believes that SDB's business profile is highly vulnerable to the intensifying risks in the domestic market, similar to peers, given the high concentration of its business profile on the weak and unstable Sri Lankan economy. This, in turn, could limit the bank's ability to generate and defend business volume while controlling risks. Elevated Risk Profile: SDB's elevated risk profile, similar to local peers, is driven by the weak OE. In addition, its assessment also takes into account that SDB's main exposure is to high-risk customers, who are susceptible to economic cycles. SDB has no exposure to defaulted foreign-currency government securities and, as such, is not directly affected by restructuring of these securities. However, the bank is still exposed to the risk of market dislocation or tighter local-currency markets as a result of austerity measures to improve the government's debt sustainability. RATING SENSITIVITIES Factors that could, individually or collectively, lead to negative rating action/downgrade: The RWN reflects rising risks to the bank's rating from funding stresses, which could lead to a multiple-notch downgrade. Fitch expects to resolve the RWN once the impact on the issuer's credit profile becomes more apparent, which may take more than six months. Developments that could lead to a multiple-notch downgrade include: - funding stress that impedes SDB's repayment ability - significant banking-sector intervention by authorities that constrains the bank's ability to service its obligations - a temporary negotiated waiver or standstill agreement following a payment default on a material financial obligation - Fitch's belief that SDB has entered into a grace or cure period following non-payment of a material financial obligation. A downgrade of the sovereign's Long-Term Local-Currency Issuer Default Rating could also lead to a downgrade of the bank's rating. Factors that could, individually or collectively, lead to positive rating action/upgrade: There is limited scope for upward rating action given the RWN. ********* S U B S C R I P T I O N I N F O R M A T I O N Troubled Company Reporter-Asia Pacific is a daily newsletter co- published by Bankruptcy Creditors' Service, Inc., Fairless Hills, Pennsylvania, USA, and Beard Group, Inc., Washington, D.C., USA. Marites O. Claro, Joy A. Agravante, Rousel Elaine T. Fernandez, Julie Anne L. Toledo, Ivy B. Magdadaro and Peter A. Chapman, Editors. Copyright 2022. All rights reserved. ISSN: 1520-9482. This material is copyrighted and any commercial use, resale or publication in any form (including e-mail forwarding, electronic re-mailing and photocopying) is strictly prohibited without prior written permission of the publishers. Information contained herein is obtained from sources believed to be reliable, but is not guaranteed. TCR-AP subscription rate is US$775 for 6 months delivered via e- mail. 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