/raid1/www/Hosts/bankrupt/TCRAP

/raid1/www/Hosts/bankrupt/TCRAP_Public/221024.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 24, 2022, Vol. 25, No. 206 Headlines A U S T R A L I A AUSTRALIA: Business Insolvencies Set to Rise, Credit Managers Say BASSLINK PTY: G+T Advises APA Group on AUD733M Acquisition Deal GEORGE PITT: Second Creditors' Meetings Set for Oct. 27 HAEMOKINESIS LIMITED: First Creditors' Meeting Set for Nov. 2 JIN RESOURCES: First Creditors' Meeting Set for Oct. 28 LA TROBE 2020-S1: S&P Affirms B (sf) Rating on Class F Notes OVH SERVICES: Second Creditors' Meeting Set for Oct. 27 SD MOTOR: Second Creditors' Meeting Set for Oct. 28 C H I N A CHINA SCE: S&P Cuts ICR to 'CCC+' Then Withdraws Rating DEXIN CHINA: Moody's Lowers CFR to Caa2 & Unsecured Notes to Caa3 GUANGZHOU R&F: Moody's Withdraws 'Caa2' Corporate Family Rating HUARONG INDUSTRIAL: Fitch Affirms 'B-' Foreign Currency IDR YANGO GROUP: Winding-Up Order Made Against Unit I N D I A AG8 VENTURES: CARE Keeps D Debt Rating in Not Cooperating Category AGH WIRES: CARE Keeps D Debt Ratings in Not Cooperating Category ARVIND KUMAR: CARE Keeps C Debt Rating in Not Cooperating ASHASHREE FROZEN: CARE Keeps D Debt Rating in Not Cooperating BHAKTI INFRACON: CARE Keeps D Debt Rating in Not Cooperating ESKAY SILK: CARE Keeps D Debt Ratings in Not Cooperating Category HAPPY ACOUSTICS: CARE Keeps D Debt Ratings in Not Cooperating JET AIRWAYS: NCLAT Hikes Admitted Claims of PNB to INR956 crore LATA EXPORT: CARE Keeps D Debt Ratings in Not Cooperating Category MA CHANDI: CARE Keeps D Debt Ratings in Not Cooperating Category MCNALLY SAYAJI: CARE Keeps D Debt Ratings in Not Cooperating MSR INDIA: CARE Lowers Rating on INR10cr LT Loan to D NANDAN BUILDCON: CARE Keeps D Debt Ratings in Not Cooperating NARAYANI FLOUR: CARE Keeps C Debt Rating in Not Cooperating NOVELTY REDDY: CARE Keeps C Debt Rating in Not Cooperating PRATIBHA MILK: CARE Keeps D Debt Rating in Not Cooperating PRINCE MARINE: CARE Keeps D Debt Ratings in Not Cooperating RAJ TRANSMISSION: Insolvency Resolution Process Case Summary RAJALAKSHMY PACKAGING: CARE Keeps D Ratings in Not Cooperating RATNAGARBHA AGRO: CARE Keeps D Debt Rating in Not Cooperating S.G. POLYPLAST: CARE Keeps D Debt Ratings in Not Cooperating SATISH MARINE: CARE Lowers Rating on INR51.01cr LT Loan to D SATURN RINGS: CARE Keeps D Debt Rating in Not Cooperating Category SENBO ENGINEERING: CARE Keeps D Debt Ratings in Not Cooperating SHANTI HOSPITAL: CARE Keeps D Debt Rating in Not Cooperating SHIV GORAKH: CARE Keeps D Debt Ratings in Not Cooperating Category SHREEJI CONSTRUCTION: CARE Keeps D Debt Rating in Not Cooperating TULSYAN NEC: CARE Keeps D Debt Ratings in Not Cooperating VISHWA (DWARAKA-OKHA): CARE Keeps D Rating in Not Cooperating VIZEBH AGRI: CARE Keeps D Debt Rating in Not Cooperating Category VIZEBH COMPOSITECH: CARE Keeps D Debt Rating in Not Cooperating N E W Z E A L A N D LOYAL VENTURE: Court to Hear Wind-Up Petition on Oct. 31 OPTIC SECURITY: Calibre Partners Appointed as Receivers OPTIC SECURITY: First Creditors' Meeting Set for Oct. 27 P C HAAK: Court to Hear Wind-Up Petition on Nov. 11 PIRATE CREW: Court to Hear Wind-Up Petition on Oct. 31 P H I L I P P I N E S SQUIDPAY: Founder Faces Ban from Holding Key Positions in NBFI S I N G A P O R E NIGELLA SG: Creditors' Proofs of Debt Due on Nov. 22 PRIME POINT: Creditors' Proofs of Debt Due on Nov. 21 SEVEN STAR: Creditors' Proofs of Debt Due on Nov. 21 THONG YONG: Deloitte Appointed as Liquidators VIOLET OON: Court to Hear Wind-Up Petition on Oct. 28 S O U T H K O R E A [*] SOUTH KOREA: Builders Face Bankruptcy Concerns T H A I L A N D THAI AIRWAYS: Bankruptcy Court Approves Bid to Amend Plan X X X X X X X X MALDIVES: Fitch Alters Outlook on 'B-' Foreign Currency IDR to Neg. - - - - - ================= A U S T R A L I A ================= AUSTRALIA: Business Insolvencies Set to Rise, Credit Managers Say ----------------------------------------------------------------- Mortgage Professional Australia reports that the current economic climate and expected slowdown is eliciting a more cautious approach from credit managers, according to a latest Equifax report. Australian credit managers expect business insolvencies and delinquencies to rise over the next six to 12 months, as concerns around interest rate rises, supply chain delays and stock availability, input costs and global economic pressures build, MPA relates In an 11th annual national credit managers' survey, released in October, Equifax assessed the role of credit management in Australian businesses, and the importance of a "360-degree customer view" when managing credit risk. According to MPA, Equifax general manager commercial Scott Mason said the level of optimism observed in 2021 had "taken a hit". Many credit managers were concerned about how their customers would weather the "perfect storm" of higher interest rates, elevated inflation, and the gloomy and uncertain economic outlook, he said. "We anticipate that the shift from credit management to risk management will ramp up significantly as a result, and they will need as much insight into their customers as possible to make accurate decisions about risk," the report quotes Mr. Mason as saying. After economic concerns, finding and attracting quality customers was the second leading issue for credit management companies to manage over the next six months, he said. MPA says Equifax referred to ASIC data, which showed an upward trend in business insolvencies in 2022, largely driven by "creditor wind ups and companies going into voluntary administration". Customers previously considered "high quality" may recently have experienced a change in their risk profile, the data and analytics provider warned. MPA relates that credit managers surveyed by Equifax identified three ways they could manage the change in risk: a. Monitor high-risk customers more closely, b. Review risk within their portfolios and c. Increase account reviews Almost two-thirds (65%) of credit managers said they planned to tighten collections this year, up from just over half (53%) last year, Equifax said. Managing risk against more volatile economic conditions would take precedence over credit managers' focus on enhancing processes, the company said. According to the report, Equifax advises credit managers to "gain a clearer understanding" of the people behind the businesses they're working with. This 360-degree view of business customers is particularly important for businesses operating within sectors exposed to market and supply chain disruption, it said. Sole traders in the construction industry were "twice as likely" to be in mortgage arrears than the average customer, Equifax data showed. Compared to the national average, SMEs and sole traders operating in accommodation and food services, construction, and wholesale trade were more likely to have personal loan arrears of 30 or more days. MPA relates that Mr. Mason said credit managers were aware that broader economic conditions affect how they approach high-risk customers. Many smaller operators were already experiencing financial pressures, and some may be dipping into their personal finances to keep their business afloat, he said. "Understanding the pain points of the people behind the businesses in their portfolios will help credit managers minimise cash flow exposure and prevent regulatory scrutiny and financial and reputational damage for their customers," Mr. Mason said. Understanding the people behind the business would enable credit managers to take immediate action, to help them better prepare for turbulence down the line. "These actions could include identifying customers that are exhibiting signs of financial difficulty and adapting their collection and lending risk parameters accordingly; being more vigilant and taking action sooner around late payers; and ensuring their PPSR registrations are up to date and correct, to protect against loss if a customer goes into administration," Mr. Mason said. BASSLINK PTY: G+T Advises APA Group on AUD733M Acquisition Deal --------------------------------------------------------------- Gilbert + Tobin advised leading Australian energy infrastructure business, ASX-listed APA Group, on all aspects of its AUD773 million acquisition of Basslink Pty Ltd (Basslink), including APA's acquisition of 100% of the secured bank debt which had a face value of approximately AUD526 million in late 2021 and early 2022, and the entry into revised network services and operational arrangements with Hydro Tasmania and the State of Tasmania respectively, to facilitate the operations of the interconnector and also provide APA with a pathway to convert Basslink to a regulated asset. Basslink owns and operates a 370km high voltage direct current electricity interconnector between Victoria and Tasmania. In November 2021, Basslink's Singaporean owner, Keppel Infrastructure Trust, placed the business into administration and the senior secured lenders at the time appointed receivers and managers to Basslink and its related entities who have had day to day control of Basslink's operations since. G+T assisted APA in its strategy to secure this unique piece of critical infrastructure, with APA confirming its interest in acquiring Basslink through its acquisition of the secured debt. This involved APA participating in the receiver-led competitive process for the sale, restructure or recapitalisation of the business, which concluded with APA being selected preferred bidder. The complex transaction then involved APA entering into binding documentation with the receivers which led to APA acquiring the shares in Basslink from the Cayman Islands-based holding company (to which the receivers were also appointed) and entering into a Deed of Company Arrangement with the Ernst & Young administrators in relation to Basslink (the DOCA). The DOCA provided the platform for Basslink to exit external administration and continue trading, unsecured trade creditors to be paid in full and the ongoing employment of Basslink's staff. The creditors of Basslink voted in favour of the Deed of Company Arrangement at the second creditors' meeting convened by the administrators of the entities on Oct. 18, 2022. As part of the transaction, complex contractual arrangements were negotiated and agreed with secured parties Hydro Tasmania and the State of Tasmania to facilitate the operations of the interconnector and provide a pathway to regulating the asset, as well as address historical matters and litigation relating to Basslink. The G+T team was jointly led by co-head of M&A and Corporate Advisory Partner, Costas Condoleon and Head of Restructuring + Insolvency Partner, Peter Bowden, and Head of Energy + Infrastructure Partner, Alexander Danne. Costas and Peter were supported by lawyers Wes Bainbridge and Megan Lowe and drew upon the support of lawyers Becci Cartoon, Nikita Goodwill and Peter Hession from the Restructuring + Insolvency team at various pressure points in the complex transaction. Alex advised on the complex negotiations with the State parties with support from energy regulatory Special Counsel Geoff Petersen, and lawyers Kestin Brown and Chi Han Yeo. Drawing on expertise from the wider Banking + Projects team and the G+T firm more generally, Banking Partner David Kirkland advised on debt financing aspects of the transaction with support from lawyer Mark Nichol, and the team was supported by various other lawyers across the firm throughout the transaction lifecycle. Mr. Condoleon commented "In a true team effort working closely with APA and its outstanding senior legal counsel, we are pleased to have successfully advised APA on this milestone transaction. This is an excellent example of G+T's ability to provide a full-service offering and collaborate seamlessly across several practice groups to deliver a desirable outcome to our client." Mr. Bowden added "It was a pleasure to advise APA Group on this significant acquisition of Basslink and be able to support APA throughout the multiple phases of the transaction. Under extremely complex circumstances and accelerated timeframes, our leading Restructuring + Insolvency group drew on the expertise of wide G+T to team navigate APA through the acquisition process. In the midst of a challenging economic landscape, I am delighted that we were able to deliver a successful outcome in the administration of Basslink and for the creditors and other stakeholders, creating much needed operational suitability for Basslink, whilst bolstering APA's infrastructure portfolio." Mr. Danne commented "G+T's Energy + Infrastructure group continues to advise on the leading energy transactions and projects in the market. We wish our client APA continued success as they continue to diversify and build upon their impressive energy infrastructure portfolio by adding a third electricity interconnector to their remit." FTI Consulting were running the sale process with advisers Houlihan Lokey and King & Wood Mallesons. About Basslink Basslink Group owns and operates the Basslink undersea power cable between Tasmania and Victoria. Basslink entered into voluntary administration and receivership on Nov. 12, 2021. GEORGE PITT: Second Creditors' Meetings Set for Oct. 27 ------------------------------------------------------- A second meeting of creditors in the proceedings of George Pitt Pty Ltd and Rowe Street Pty Ltd has been set for Oct. 27, 2022, at 9:30 a.m. and 10:30 am respectively, 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. 26, 2022, at 4:00 p.m. Christopher Damien Darin of Worrells was appointed as administrator of the company on Sept. 27, 2022. HAEMOKINESIS LIMITED: First Creditors' Meeting Set for Nov. 2 ------------------------------------------------------------- A first meeting of the creditors in the proceedings of Haemokinesis Limited will be held on Nov. 2, 2022, at 3:00 p.m. via virtual facilities. Manuel Hanna and Renee Di Carlo of Romanis Cant were appointed as administrators of the company on Oct. 20, 2022. JIN RESOURCES: First Creditors' Meeting Set for Oct. 28 ------------------------------------------------------- A first meeting of the creditors in the proceedings of Jin Resources (Aus) Pty Ltd will be held on Oct. 28, 2022, via virtual meeting technology. Marcus Watters, Richard Albarran and Brent Kijurina of Hall Chadwick were appointed as administrators of the company on Oct. 18, 2022. LA TROBE 2020-S1: S&P Affirms B (sf) Rating on Class F Notes ------------------------------------------------------------ S&P Global Ratings raised its ratings on four classes of nonconforming RMBS notes issued by Perpetual Corporate Trust Ltd. as trustee of La Trobe Financial Capital Markets Trust 2019-1 and La Trobe Financial Capital Markets Trust 2020-S1. At the same time, s&p affirmed its ratings on 11 classes of notes issued out of the same trusts. S&P said, "The rating actions reflect our view of the credit support available, which is sufficient to withstand the stresses we apply. Current loan-to-value ratios across the pools have been declining and seasoning has increased, which lowers our expectation of loss for the pool. Credit support provided in percentage terms has increased as the pools have paid down. As of Aug. 31, 2022, the pool factors for the transactions are 36.7% for 2019-1 and 52.3% for 2020-S1. "We have also factored into our analysis the arrears performance and relatively high level of self-employed borrowers and investment loans in the pool. These characteristics increase our expectation of loss for the portfolio." As of Aug. 31, 2022, loans greater than 30 days in arrears represent 3.65% for 2019-1, of which 2.08% are more than 90 days in arrears, and 1.2% for 2020-S1, all of which are more than 90 days in arrears. Losses to date have been minimal and have all been covered by excess spread. There have been no charge-offs to any of the notes. The transactions' cash flows support the timely payment of interest and ultimate payment of principal to the noteholders under S&P's rating stress assumptions. For both transactions, under the pro-rata payment structure, the Equity notes allocated principal is paid to the class F notes until the class F notes are fully repaid, followed by the remaining subordinated notes once the class F notes have fully repaid. Therefore, the class F notes will continue to benefit from an increase in the percentage of credit support provided as the pool amortizes under a pro rata structure, while for the remaining rated notes the percentage of credit support will remain static. Currently, the 2019-1 has reverted to pro-rata payment, whereas the 2020-S1 transaction is sequential pay until the pro-rata triggers are met. S&P expects 2020-S1 will convert to pro rata in the coming months. The turbo repayment of the class F notes, being the most subordinated rated notes, has created overcollateralization, which provides additional credit support for the rated tranches in both transactions. Constraining factors on the degree of upgrades for both transactions are the likely effect of currently rising interest rates on the arrears of nonconforming borrowers within the pool and on the increasing risk of borrower concentration as the pools continue to amortize. S&P's view is that the lower-rated notes are more susceptible to increasing borrower concentration risk. As of June 30, 2022, the largest 10 borrowers comprise 4.70% of the pool for 2019-1 and 7.07% for 2020-S1. In addition, the structures incorporate a trigger that if cumulative losses experienced on mortgage loans exceed 110% of the initial credit enhancement provided to a class of notes--other than the class A notes--then that class of notes cannot utilize these liquidity mechanisms. This also acts as a constraining factor when raising ratings. These qualitative factors constrain the ratings beyond quantitative factors alone. Ratings Raised La Trobe Financial Capital Markets Trust 2019-1 Class B: to AAA (sf) from AA+ (sf) Class C: to AA (sf) from A+ (sf) La Trobe Financial Capital Markets Trust 2020-S1 Class B: to AA+ (sf) from AA (sf) Class C: to A+ (sf) from A (sf) Ratings Affirmed La Trobe Financial Capital Markets Trust 2019-1 Class A1L: AAA (sf) Class A2S: AAA (sf) Class A2L: AAA (sf) Class D: BBB+ (sf) Class E: BB (sf) Class F: B (sf) La Trobe Financial Capital Markets Trust 2020-S1 Class A1L: AAA (sf) Class A2: AAA (sf) Class D: BBB (sf) Class E: BB (sf) Class F: B (sf) OVH SERVICES: Second Creditors' Meeting Set for Oct. 27 ------------------------------------------------------- A second meeting of creditors in the proceedings of OVH Services Pty Ltd has been set for Oct. 27, 2022, at 10:30 a.m. via teleconference facilities. The purpose of the meeting is (1) to receive the report by the Administrator about the business, property, affairs and financial circumstances of the Company; and (2) for the creditors of the Company to resolve whether the Company will execute a deed of company arrangement, the administration should end, or the Company be wound up. Creditors wishing to attend are advised proofs and proxies should be submitted to the Administrator by Oct. 26, 2022, at 4:30 p.m. Stephen Dixon of HM Advisory was appointed as administrator of the company on Sept. 20, 2022. SD MOTOR: Second Creditors' Meeting Set for Oct. 28 --------------------------------------------------- A second meeting of creditors in the proceedings of SD Motor Vehicle Group Pty Ltd has been set for Oct. 28, 2022, at 2:00 p.m. via virtual meeting technology. The purpose of the meeting is (1) to receive the report by the Administrator about the business, property, affairs and financial circumstances of the Company; and (2) for the creditors of the Company to resolve whether the Company will execute a deed of company arrangement, the administration should end, or the Company be wound up. Creditors wishing to attend are advised proofs and proxies should be submitted to the Administrator by Oct. 27, 2022, at 5:00 p.m. Anne Meagher and Adam Peter Kersey of SV Partners were appointed as administrators of the company on July 19, 2022. ========= C H I N A ========= CHINA SCE: S&P Cuts ICR to 'CCC+' Then Withdraws Rating ------------------------------------------------------- On Oct. 21, 2022, S&P Global Ratings lowered its long-term issuer credit ratings on China-based property developer China SCE Group Holdings Ltd. to 'CCC+' from 'B-'. At the same time, S&P lowered its long-term issue rating on the company's outstanding senior unsecured notes to 'CCC' from 'CCC+'. S&P withdrew its issuer credit ratings and issue ratings on China SCE at the company's request. The rating outlook was negative at the time of the withdrawal. S&P lowered the ratings because it sees heightened contagion risk from JV partners. China SCE's recent disputes with financial institutions over the repayment of trust loans related to a project with a distressed developer could tighten the company's funding channels. The financial institutions could potentially slow the drawdown of construction loans by China SCE or reduce their exposure to the company. This could further dampen the company's liquidity, given that bank loans and nonbank financing accounted for a significant 62% of its total borrowings as of June 30, 2022. China SCE's access to cash could also be affected. This is because creditors or other stakeholders might prefer cash to stay at project companies or in accounts managed by them, considering the company's weakening credit profile. Continuous repayment of capital-market financing with internal resources further weakens liquidity.China SCE has Chinese renminbi (RMB) 1.28 billion of asset-backed securities maturing in December 2022. The company also has a US$500 million offshore bond maturing in April 2023. Refinancing of these bonds is highly unlikely, given current weak market sentiment. This leads us to believe that China SCE would need to repay the debts with internal resources. The company had about RMB7 billion at the holding company level as of Dec. 31, 2021. S&P estimates the amount declined to RMB5 billion-RMB6 billion as of June 30, 2022. S&P believes China SCE is still actively managing its upcoming maturities with high willingness. The company wired its repayment of a 2023 US dollar bond coupon early, before the due date. It also managed to repay its RMB2 billion domestic bonds puttable in October 2022 with internal resources. Investors had exercised puts on about RMB1.4 billion of these bonds. The company also has some asset divestment plans for debt repayment, although execution of these plans is subject to high uncertainty. China SCE's leverage will likely further increase, making its capital structure unsustainable. This is due to slower sales execution. By S&P's estimate, the company's leverage in terms of the debt-to-EBITDA ratio could trend toward 11x in 2022-2023. Its EBITDA interest coverage could stay at 1.3x-1.5x. The negative rating outlook prior to the rating withdrawal reflects S&P's view that China SCE's liquidity could further deteriorate over the next 12 months. This is due to weaker cash generation from operations than it expects and cash outflow to JV partners. Environmental, Social, And Governance ESG credit indicators: To E-3, S-2, G-4; From E-3, S-2, G-3 Governance factors are now a negative consideration in our credit rating analysis of China SCE. Governance constraints include a lack of sufficient risk management standards to identify and control the company's JV and nonbank financing exposure, which has caused liquidity and reputational risk. Meanwhile, China SCE did not make enough disclosure on its exposure to JVs. This makes it difficult to gauge contagion risk from JV partners. Environmental, social, and governance (ESG) credit factors for this change in credit rating/outlook and/or CreditWatch status: -- Risk management, culture, and oversight -- Transparency and reporting DEXIN CHINA: Moody's Lowers CFR to Caa2 & Unsecured Notes to Caa3 ----------------------------------------------------------------- Moody's Investors Service has downgraded Dexin China Holdings Company Limited's corporate family rating to Caa2 from Caa1 and the company's senior unsecured rating to Caa3 from Caa2. The outlook remains negative. "The rating downgrade reflects Dexin's heightened default risks considering its sizable debt maturities over the next 6-12 months and stressed liquidity due to declining contracted sales and weakened funding access," says Alfred Hui, a Moody's Analyst. "The negative outlook reflects Moody's expectation that creditors' recovery prospects could deteriorate if the company defaults," adds Hui. RATINGS RATIONALE Moody's estimates that Dexin's RMB10.6 billion of unrestricted cash as of June 2022, together with operating cash flow, will be insufficient to cover all of its debt maturities over this period. Dexin has sizable debt maturities over the next 6-12 months, including the USD348 million offshore bond maturing in December 2022. Although Dexin plans to raise funds from asset disposals or other channels, these fundraising activities entail high execution risks amid weak market sentiment and tight funding conditions. There has been little progress on Dexin's fundraising plans over the past two to three months, which raises the repayment risks for the company's upcoming debt maturities. Moody's forecasts Dexin's contracted sales will remain sluggish with a 50% decline to RMB37 billion in 2022. The weak contracted sales would weigh on the company's operating cash flow and liquidity. Dexin's contracted sales dropped 37% year on year in September and 52% to RMB27.5 billion for the first nine months. In addition, Dexin has a high exposure to joint ventures (JV). These JV partnership arrangements will weaken its control over the cash flow and operation of the JV projects. Dexin may also need to seek consent from JV partners if it wants to remit funds at the project level. This increases uncertainty over Dexin's ability to deploy its project-level cash to meet its debt obligations. Dexin's Caa3 senior unsecured debt rating is one notch lower than the company's CFR due to structural subordination risk. This risk reflects the fact that the majority of claims are at the operating subsidiaries and have priority over Dexin's senior unsecured claims in a bankruptcy scenario. In addition, the holding company lacks significant mitigating factors for structural subordination. As a result, the expected recovery rate for claims at the holding company will be lower. In terms of environmental, social and governance factors, Moody's has considered the risks associated with Dexin's concentrated ownership by its key shareholder and chairman, Mr. Hu Yiping, who held a stake of 71% in the company as of the end of June 2022. The delay in the release of its 2021 audited financial results and the auditor change earlier this year, as well as its failure to report a disclosable transaction as required by the Hong Kong Stock Exchange's listing rules, also reflect the company's weak corporate governance, transparency and information disclosure. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS Moody's could downgrade the ratings if Dexin defaults on its debt repayment obligations or the recovery prospects for Dexins creditors deteriorate further. Meanwhile, an upgrade of Dexin's ratings is unlikely given the negative outlook. However, positive rating momentum could emerge if Dexin successfully addresses its near-term debt repayment, improves its operating cash flow, liquidity and access to funding over the next 12-18 months. The principal methodology used in these ratings was Homebuilding And Property Development Industry published in January 2018. Dexin China Holdings Company Limited is a Zhejiang-based residential property developer. As of June 30, 2022, its land reserves totaled 17.5 million square meters in gross floor area, with most of them in the Yangtze River Delta cities such as Hangzhou, Wenzhou, Ningbo and Nanjing. GUANGZHOU R&F: Moody's Withdraws 'Caa2' Corporate Family Rating --------------------------------------------------------------- Moody's Investors Service has withdrawn the Caa2 corporate family rating of Guangzhou R&F Properties Co., Ltd. and Caa3 corporate family rating of R&F Properties (HK) Company Limited. Prior to the withdrawal, the rating outlooks on both entities were negative. RATINGS RATIONALE Moody's has decided to withdraw the ratings for its own business reasons. COMPANY PROFILE Established in 1994 and listed on the Hong Kong Stock Exchange in 2005, Guangzhou R&F Properties Co., Ltd. is a residential and commercial property developer in China. Mr. Li Sze Lim and Mr. Zhang Li are the company's co-founders and owned 29.0% and 27.8% in equity interest, respectively, as of June 30, 2022. R&F Properties (HK) Company Limited (R&F HK) and its subsidiaries are principally engaged in the development and sale of properties, property investment and hotel operations in China. The company was established in Hong Kong SAR, China, on August 25, 2005. It serves as an offshore funding vehicle and holding company for some of Guangzhou R&F's property projects in China. HUARONG INDUSTRIAL: Fitch Affirms 'B-' Foreign Currency IDR ----------------------------------------------------------- Fitch Ratings has affirmed Huarong Industrial Investment & Management Co., Ltd.'s Long-Term Foreign-Currency Issuer Default Rating (IDR) at 'B-'. The Outlook is Stable. Fitch has also affirmed the rating on the outstanding senior unsecured bonds issued by Huarong Universe Investment Holding Limited and guaranteed by Huarong Industrial at 'B-'. The recovery rating is 'RR4'. Huarong Industrial's ratings incorporate a two-notch uplift from its Standalone Credit Profile (SCP) of 'ccc' under the strong parent, weak subsidiary approach in its Parent and Subsidiary Linkage Rating Criteria. Fitch assesses the linkage factors of legal incentives as 'Medium', strategic incentives as 'Weak' and operational incentives as 'Medium'. Huarong Industrial is a wholly owned subsidiary of China Huarong Asset Management Co., Ltd. (China Huarong, BBB+/Stable). The Stable Outlook reflects its belief that Huarong Industrial will continue to receive strong liquidity support from the parent. KEY RATING DRIVERS 'Medium' Legal Incentive for Parent to Provide Support: The shareholder loans of Huarong Industrial's parent, China Huarong, accounted for 67% of Huarong Industrial's total debt as of end-1H22. The parent also guaranteed 10% of Huarong Industrial's external debt. However, Huarong Industrial said that there is no cross default in the two companies' debt. 'Weak' Strategic Incentive for Parent to Provide Support: Huarong Industrial's financial contribution to the parent is low, accounting for only 1%-3% of China Huarong's profit and assets. Most distressed assets are resolved by the group, rather than through subsidiaries. Huarong Industrial provides the parent with cost advantages, rather than competitive advantages, as some property-related work can theoretically be outsourced to other developers or consultants. Fitch believes Huarong Industrial's growth potential is moderate in the short-term as the property industry is in the trough of a business cycle. 'Medium' Operational Incentive for Parent to Provide Support: Huarong Industrial develops distressed property assets acquired from the parent and advises on distressed property management resolution. Over 70% of its land bank is sourced from the parent. Huarong Industrial sometimes helps China Huarong value distressed asset packages before they are acquired by the parent. Huarong Industrial's management decisions and product and services branding are full integrated with those of the parent. Reliant on Parent for Liquidity: Huarong Industrial reported CNY1.7 billion in available cash at hand at end-1H22. This was insufficient to cover CNY30.0 billion in short-term debt. Huarong Industrial has CNY5.8 billion in capital market instruments due in the next three months, including a EUR500 million bond due December 2022 and CNY2.3 billion in domestic bonds. The company plans to refinance the bonds with new issues and borrow from China Huarong to service the remaining amount, if necessary. Fitch believes China Huarong will continue to provide extensive liquidity support to Huarong Industrial, as stated explicitly by the parent in Huarong Industrial's annual report. Weak SCP Assessment: The weak SCP stems from Huarong Industrial's small scale and unsustainably high leverage compared with peers. It generated CNY492 million in contracted sales in 2021, while January-July 2022 sales were around CNY100 million. Total land bank is around 4.5 million square metres, of which 44% is a project in Xiangtan - a tier-three city in Hunan province - acquired from China Huarong's subsidiary in 2011. Huarong Industrial does not run a commercial homebuilding business and relies entirely on China Huarong operationally and financially. DERIVATION SUMMARY Huarong Industrial is rated two notches above its SCP. The ratings are supported by its linkage with its parent, China Huarong. The linkage is similar to that between Yuexiu Property Company Limited (YXP, BBB-/Stable) and Guangzhou Yuexiu Holdings Limited (GYX). GYX's legal incentive to support YXP is 'Weak', the operational incentive is 'Medium' and the strategic incentive is 'Medium'. Fitch believes China Huarong's legal incentive to support Huarong Industrial is stronger due to the large amount of shareholder loans extended, but the strategic incentive is weaker due to Huarong Industrial's much smaller contribution to its parent. KEY ASSUMPTIONS Fitch's Key Assumptions Within Its Rating Case for the Issuer - CNY150 million in property development contracted sales in 2022 and CNY800 million in 2023 - 30% property development gross profit margin in 2022-2023 (2021: 42%) - No land acquisitions from 2022 in the medium term, in line with management forecast. KEY RECOVERY RATING ASSUMPTIONS The recovery analysis assumes Huarong Industrial would be liquidated rather than reorganised as a going-concern in bankruptcy. Fitch assumes a 10% administrative claim. Liquidation Approach The liquidation estimate reflects its view of the value of balance-sheet assets that can be realised in a sale or liquidation process conducted during bankruptcy or insolvency proceedings and distributed to creditors. - Advance rate of 80%, raised from 70%, applied to account receivables. This treatment is in line with its Recovery Rating criteria. - Advance rate of 63% applied to net property inventory. Huarong Industrial's inventory consists mainly of completed properties held for sale and properties under development (PUD). Different advance rates were applied to the various inventory categories to derive the blended advance rates for net inventory. - Advance rate of 80% applied to completed properties held for sale due to Huarong Industrial's high gross development- property margin of above 35%. Completed commodity housing units are closer to readily marketable inventory. - Advance rate of 60% applied to PUD, which are more difficult to sell than completed projects and are at various stages of completion. The PUD balance - prior to applying the advance rate - is net of margin-adjusted customer deposits. - Advance rate of 50% applied to property, plant and equipment. - Advance rate of 60% applied to investment properties booked at cost. Huarong Industrial's investment-property portfolio consists mainly of an urban complex project in Chongqing, which accounted for 67% of the total value. The portfolio has an average rental yield at cost of around 5%. - Advance rate of 50% applied to joint venture net assets. These typically include a combination of completed units, PUD and land bank. The advance rate is in line with the baseline advance rate for inventory. - Advance rate of 0% applied to excess cash, after netting the amount of note payables and trade payables. Fitch does not assume available cash in excess of outstanding trade payables would be available for other debt- servicing purposes. - The allocation of value in the liability waterfall results in a Recovery Rating corresponding to 'RR4' for the senior unsecured offshore bonds. RATING SENSITIVITIES Factors that could, individually or collectively, lead to negative rating action/downgrade: - A perceived weakening of incentives for China Huarong to support Huarong Industrial - Evidence of deterioration in liquidity and heightened refinancing risks Factors that could, individually or collectively, lead to positive rating action/upgrade: - A perceived strengthening of incentives for China Huarong to support Huarong Industrial - Sustained improvement in liquidity and financial transparency ISSUER PROFILE Huarong Industrial is China Huarong's property-development platform, and one of three "first-level" subsidiaries of China Huarong's distressed asset-management business. It develops distressed property projects and provides property-related advisory services to the parent. ESG CONSIDERATIONS Fitch has revised Huarong Industrial's ESG Relevance Score for Management Strategy to '4' from '5' amid the parent's strategy of focusing on distressed-asset management and divesting non-core businesses. Risks of deviation from or failure of the strategy have a negative impact, and is relevant to the ratings in conjunction with other factors. The scoring is in line with that of the parent. Fitch has revised Huarong Industrial's ESG Relevance Score for Governance Structure to '4', from '5', following the recapitalisation and introduction of new strategic shareholders for its parent. Governance under the new shareholding structure may have a positive or negative impact, and is relevant to the ratings in conjunction with other factors. The scoring is in line with that of the parent. Fitch has revised Huarong Industrial's ESG Relevance Score for Financial Transparency to '4' from '5', following the resolution of its audit issue and the subsequent publication of the 2020 annual report for both the subsidiary and the parent. Limited transparency over the subsidiary's or the parent's asset quality has a negative impact, and is relevant to the ratings in conjunction with other factors. The scoring is in line with that of the parent. Unless otherwise disclosed in this section, the highest level of ESG credit relevance is a score of '3'. This means ESG issues are credit-neutral or have only a minimal credit impact on the entity, either due to their nature or the way in which they are being managed by the entity. Entity/Debt Rating Recovery Prior ----------- ------ -------- ----- Huarong Industrial Investment & Management Co., Ltd. LT IDR B- Affirmed B- Huarong Universe Investment Holding Limited senior unsecured LT B- Affirmed RR4 B- YANGO GROUP: Winding-Up Order Made Against Unit ----------------------------------------------- Bloomberg News reports that a winding-up order has been issued in Hong Kong against Yango Group Co.'s unit that defaulted on offshore bonds, as debtholders of distressed builders increasingly seek court help in recovering funds amid record missed payments. The order regarding Yango Justice International Ltd. was dated Oct. 17, Bloomberg relates citing a winding up search report done through the website of Hong Kong's Official Receiver's Office. The case's first hearing date was Sept. 14 and the adjourned hearing was Oct. 17, the same day of the order. The development makes Yango one of the first major Chinese developers to receive a winding-up order for a unit via the courts in Hong Kong, a city which has acted as a gateway for investors to access China's high-yield credit, Bloomberg notes. Those bonds, largely issued by builders, have slid into unprecedented distress this year, reversing what was once one of the world's most lucrative debt trades, says Bloomberg. The tumble comes as China grapples with a real estate crisis fueled in part by a clampdown started in 2020 on excessive borrowing by property firms and speculation by home buyers. Some builders have left projects unfinished as they struggle to pay suppliers and creditors, causing defaults to surge. That's sparked a flurry of winding-up petitions filed in Hong Kong or Cayman Islands courts against developers, including China Evergrande Group -- the giant whose default on dollar notes in late 2021 exacerbated the broader industry crisis, the report states. Evergrande has said that it's actively pushing forward offshore debt restructuring work with its financial and legal advisers. If a Hong Kong court gives a winding-up order and appoints a provisional liquidator, the latter takes control of the firm in question and disposes of realizable assets, according to an explanation posted on the Official Receiver's Office website, Bloomberg relays. Any remaining funds are distributed to creditors whose claims have been admitted. When Yango Group was asked by Bloomberg News on Oct. 21 whether it could confirm the winding-up order, the company wouldn't comment on any issuance of an order, but said it is still actively negotiating and handling matters with creditors. The search report from Hong Kong's Official Receiver's Office lists "official receiver" in the line for provisional liquidator, without giving further details. Yango Justice defaulted for the first time in February when it missed paying $27.3 million of interest on two dollar bonds within a 30-day grace period, capping months of debt struggles that included seeking payment extensions, according to Bloomberg. Bloomberg adds that parent Yango disclosed a winding-up petition against its unit in July involving an $8.5 million payment for offshore notes and said it "strongly" opposed the filing. It's unclear whether the order is related to that case. Yango Group was China's 19th-largest builder by contracted sales in 2021 but has fallen to 36th so far this year, according to China Real Estate Information Corp. The developer said in a July exchange filing that Hong Kong-incorporated Yango Justice made up less than 10% of its net assets as of the end of 2021. Yango Group Co.,Ltd is a China-based company principally engaged in the development and sale of real estates. The Company's property projects include residential buildings, office buildings and commercial properties, among others. The Company is also involved in the import and export trading, hotel operation, education management and other businesses. The Company mainly operates its business in domestic market, with East China as its main market. ========= I N D I A ========= AG8 VENTURES: CARE Keeps D Debt Rating in Not Cooperating Category ------------------------------------------------------------------ CARE Ratings said the rating for the bank facilities of AG8 Ventures Limited (AVL) continues to remain in the 'Issuer Not Cooperating' category. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term Bank 150.40 CARE D; ISSUER NOT COOPERATING Facilities Rating continues to remain under ISSUER NOT COOPERATING category Detailed Rationale & Key Rating Drivers CARE Ratings Ltd. had, vide its press release dated August 17, 2021, placed the rating(s) of AVL under the 'issuer non-cooperating' category as AVL 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. AVL 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). Originally incorporated in 1997 as Aakriti Dwellings Pvt. Ltd., AVL is the flagship company of the Bhopal based "Aakriti Group". AVL is engaged in development of multi-storied residential as well as commercial properties around Bhopal region. In addition to the real estate sector, "Aakriti Group" has presence in sugar, hospitality and education industry. AGH WIRES: CARE Keeps D Debt Ratings in Not Cooperating Category ---------------------------------------------------------------- CARE Ratings said the ratings for the bank facilities of Agh Wires Private Limited (AWPL) continue to remain in the 'Issuer Not Cooperating' category. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term Bank 10.73 CARE D; ISSUER NOT COOPERATING Facilities Rating continues to remain under ISSUER NOT COOPERATING category Short Term Bank 2.16 CARE D; ISSUER NOT COOPERATING Facilities Rating continues to remain under ISSUER NOT COOPERATING category Detailed Rationale & Key Rating Drivers CARE Ratings Ltd. had, vide its press release dated August 18, 2021, placed the rating(s) of AWPL under the 'issuer non-cooperating' category as AWPL 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. AWPL continues to be non-cooperative despite repeated requests for submission of information through e-mails, phone calls and a letter/email dated July 4, 2022, July 14, 2022, July 24, 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). AGH Wires Private Limited was incorporated in July 2011 and is engaged in the business of manufacturing aluminium and copper enamelled wires which are used in generators, transformers, air conditioners, audio devices, watches, microphones etc. ARVIND KUMAR: CARE Keeps C Debt Rating in Not Cooperating --------------------------------------------------------- CARE Ratings said the rating for the bank facilities of Arvind Kumar Nand Kumar Limited (AKNKL) continues to remain in the 'Issuer Not Cooperating' category. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term Bank 5.49 CARE C; Stable; ISSUER NOT Facilities COOPERATING; Rating continues To remain under ISSUER NOT COOPERATING category Short Term 0.51 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 12, 2021, placed the rating(s) of AKNKL under the 'issuer non-cooperating' category as AKNKL 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. AKNKL continues to be noncooperative despite repeated requests for submission of information through e-mails, phone calls and a letter/email dated June 28, 2022, July 8, 2022, July 18, 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). Arvind Kumar Nand Kumar Limited (AKNKL) was promoted by Mr. P. D. Bhatter along with his brother Mr. H. D. Bhatter in 1973 as a private limited company. Then after in the year 1981, it was converted into public limited company. AKNKL is engaged in the milling and processing of rice at its processing plant located at Kolkata and production of PCC poles at its plant located at Jaipur since incorporation. ASHASHREE FROZEN: CARE Keeps D Debt Rating in Not Cooperating ------------------------------------------------------------- CARE Ratings said the rating for the bank facilities of Ashashree Frozen foods Private Limited (AFFPL) continues to remain in the 'Issuer Not Cooperating' category. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term Bank 6.70 CARE D; ISSUER NOT COOPERATING Facilities Rating continues to remain under ISSUER NOT COOPERATING category Detailed Rationale & Key Rating Drivers CARE Ratings Ltd. had, vide its press release dated August 12, 2021, placed the rating(s) of AFFPL under the 'issuer non-cooperating' category as AFFPL 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. AFFPL continues to be non-cooperative despite repeated requests for submission of information through e-mails, phone calls and a letter/email dated June 28, 2022, July 8, 2022, July 18, 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 2014, Ashashree Frozen Foods Private Limited (AFFPL) was promoted by Shri Srikanta Kumar Khuntia and Smt. Anupama Khuntia for setting up a dairy processing plant in Odisha. AFFPL has already set up the dairy processing unit at Hatibari, Sambalpur with a processing capacity of 45,000 litre of milk per day. The commercial operation of the unit has started from January 14, 2018. AFFPL procures from locally and sells its milk products through distributors. The company has not availed moratorium from its lender that could be availed as per RBI circular. BHAKTI INFRACON: CARE Keeps D Debt Rating in Not Cooperating ------------------------------------------------------------ CARE Ratings said the rating for the bank facilities of Bhakti Infracon LLP (BIL) continues to remain in the 'Issuer Not Cooperating' category. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term Bank 40.00 CARE D; ISSUER NOT COOPERATING Facilities Rating continues to remain under ISSUER NOT COOPERATING category Detailed Rationale & Key Rating Drivers CARE Ratings Ltd. had, vide its press release dated August 23, 2021, placed the rating(s) of BIL under the 'issuer non-cooperating' category as BIL 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. BIL 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). Surat (Gujarat) based, BIL was established as a partnership firm during July 2017 named Bhakti Buildcon by Mr.Rakeshkumar Dudhwala, Ms. Dimpleben Dudhwala, Mr. Pradipkumar Patel, Mr.Banti Sadadiwala, Mr. Dineshbhai Patel and Mr. Jigarbhai Gajjar. In February 2018, the firm converted to Limited Liability Partnership and named Bhakti Infracon LLP. BIL is currently executing a commercial project named 'Walk Way The Mall' (RERA Registration No. PR/GJ/SURAT/SURAT CITY/SUDA/CAA02185/270318) with 250 proposed units (223 shops, 12 food shops, a restaurant, a gym, a game zone and a multiplex) at Surat. BIL is part of Surat based 'Bhakti group' which has strong presence in Surat. Over the period, the group has completed various projects of more than 11.62 lakh Sq. feet. Currently the group has on-going projects with cost of more than Rs.118.95 crore under different entities. ESKAY SILK: CARE Keeps D Debt Ratings in Not Cooperating Category ----------------------------------------------------------------- CARE Ratings said the rating for the bank facilities of Eskay Silk Industries Private Limited (ESIPL) continues to remain in the 'Issuer Not Cooperating' category. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term Bank 16.19 CARE D; ISSUER NOT COOPERATING Facilities Rating continues to remain under ISSUER NOT COOPERATING category Short Term Bank 2.50 CARE D; ISSUER NOT COOPERATING Facilities Rating continues to remain under ISSUER NOT COOPERATING category Detailed Rationale & Key Rating Drivers CARE Ratings Ltd. had, vide its press release dated August 23, 2021, placed the rating(s) of ESIPL under the 'issuer non-cooperating' category as ESIPL had failed to provide information for monitoring of the rating and had not paid the surveillance fees for the rating exercise as agreed to in its Rating Agreement. ESIPL continues to be non-cooperative despite repeated requests for submission of information through e-mails, phone calls and a letter/email dated 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). Eskay Silk Industries Private Limited (ESIPL) was promoted by Shri Motilal Jain and Shri Suresh Kumar Jain in 1984 and later taken over by Agarwal family in 1991. ESIPL was earlier primarily engaged in trading of high-quality textile fabrics has now ventured into fabric manufacturing from FY12. The capacity of ESIPL stood at 36.72 lakh pieces per annum as on March 31, 2015. HAPPY ACOUSTICS: CARE Keeps D Debt Ratings in Not Cooperating ------------------------------------------------------------- CARE Ratings said the rating for the bank facilities of Happy Acoustics Private Limited (HAPL) continues to remain in the 'Issuer Not Cooperating' category. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term Bank 1.50 CARE D; ISSUER NOT COOPERATING Facilities Rating continues to remain under ISSUER NOT COOPERATING category Short Term Bank 36.50 CARE D; ISSUER NOT COOPERATING Facilities Rating continues to remain under ISSUER NOT COOPERATING category Detailed Rationale & Key Rating Drivers CARE Ratings Ltd. had, vide its press release dated August 30, 2021, placed the rating(s) of HAPL under the 'issuer non-cooperating' category as HAPL 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. HAPL continues to be noncooperative despite repeated requests for submission of information through e-mails, phone calls and a letter/email dated July 16, 2022, July 26, 2022, August 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). HAPL was incorporated on March 16, 2012 by Mr Amarjit Singh Kalra and his wife, Ms Surinder Kaur Kalra. The company is involved in the manufacturing and assembling of public address (PA) systems and components, including loud speakers, amplifiers, microphones, and woofers, and related electronic and electrical equipment. The company commenced operations in September, 2012 and its manufacturing facility is located in Delhi. JET AIRWAYS: NCLAT Hikes Admitted Claims of PNB to INR956 crore --------------------------------------------------------------- Financial Express reports that a National Company Law Appellate Tribunal (NCLAT) bench on Oct. 21 increased the admitted claims of Punjab National Bank (PNB) to INR956 crore, from INR754 crore, in the Jet Airways insolvency case. "It is held that the appellant is entitled to their accepted claim of INR956.21 crore. Reduction of their claim by resolution professional is set aside," said the NCLAT order. PNB was the appellant, while the respondents were the resolution professional, the Jalan-Kalrock consortium and the committee of creditors, according to FE. FE notes that PNB had submitted its initial claim of INR963.47 crore in July 2019 but later revised it to INR956.11 crore in August 2019. The final claim submitted in September 2020 stood at INR994.16 crore. FE relates that the resolution professional had reduced the claim by INR202.09 crore, following which PNB filed an application objecting to the reduction. PNB is one of the largest shareholders in Jet Airways, holding 26% in the company as at September-end. "The appellant is aggrieved by reduction of its admitted claim and is entitled for payment of its full debt as per the Resolution Plan," the senior counsel appearing for PNB stated. About Jet Airways Based in Mumbai, India, Jet Airways (India) Limited was one of India's top airlines founded by Naresh Goyal. It provided passenger and cargo air transportation services as well aircraft leasing services. It operated flights to 66 destinations in India and international countries. Jet Airways on April 17, 2019, halted all flight operations after its lenders rejected its plea for emergency funds. On June 20, 2019, the National Company Law Tribunal (NCLT), Mumbai Bench, accepted an insolvency petition against Jet Airways filed by its creditors as they attempt to recover some of their dues. Ashish Chhawchharia of Grant Thornton India has been named as the resolution professional in the case. Law firm Cyril Amarchand Mangaldas will represent the interests of the lenders' consortium, according to a Reuters report. Creditors have filed claims worth INR30,907 crore, according to Financial Express. The RP has so far admitted claims worth over INR14,000 crore. In July last year, the Jalan-Kalrock consortium was declared as the winning bidder for Jet Airways. In June last year, the NCLT approved the consortium's resolution plan for the troubled carrier. Jet Airways got its air operator certificate revalidated in May this year. The Mumbai-based company had plans to resume operations in October but has not provided any official comments on the same, according to Financial Express. LATA EXPORT: CARE Keeps D Debt Ratings in Not Cooperating Category ------------------------------------------------------------------ CARE Ratings said the ratings for the bank facilities of Lata Export Apparels Private Limited (LEAPL) continue to remain in the 'Issuer Not Cooperating' category. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term Bank 7.50 CARE D; ISSUER NOT COOPERATING Facilities Rating continues to remain under ISSUER NOT COOPERATING category Short Term Bank 6.75 CARE D; ISSUER NOT COOPERATING Facilities Rating continues to remain under ISSUER NOT COOPERATING category Detailed Rationale & Key Rating Drivers CARE Ratings Ltd. had, vide its press release dated August 25, 2021, placed the rating(s) of LEAPL under the 'issuer non-cooperating' category as LEAPL had failed to provide information for monitoring of the rating and had not paid the surveillance fees for the rating exercise as agreed to in its Rating Agreement. LEAPL continues to be non-cooperative despite repeated requests for submission of information through e-mails, phone calls and a letter/email dated July 11, 2022, July 21, 2022, July 31, 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 1996 by the Karthikeyan family, Lata Exports Apparels Private Limited (LEAPL) is engaged into manufacturing of ready-made garments and uniforms for men, women and children. LEAPL has its manufacturing facility at Bhiwandi. MA CHANDI: CARE Keeps D Debt Ratings in Not Cooperating Category ---------------------------------------------------------------- CARE Ratings said the ratings for the bank facilities of Ma Chandi Rice mill (MCRM) continue to remain in the 'Issuer Not Cooperating' category. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term Bank 7.49 CARE D; ISSUER NOT COOPERATING Facilities Rating continues to remain under ISSUER NOT COOPERATING category Short Term Bank 0.25 CARE D; ISSUER NOT COOPERATING Facilities Rating continues to remain under ISSUER NOT COOPERATING category Detailed Rationale & Key Rating Drivers CARE Ratings Ltd. had, vide its press release dated August 26, 2021, placed the rating(s) of MCRM under the 'issuer non-cooperating' category as MCRM 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. MCRM continues to be non-cooperative despite repeated requests for submission of information through e-mails, phone calls and a letter/email dated July 12, 2022, July 22, 2022, August 1, 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). Ma Chandi Rice Mill (MCRM) was established as a partnership firm in December 2000 by Mr. Rama Pada Shaw and Mr. Mukti Pada Shaw for setting up a rice processing plant. The firm has commenced its commercial operations from June 2006 onwards and it is engaged in milling and processing of parboiled and raw rice. The rice milling and processing plant of the firm is located at Burdwan, West Bengal with a processing capacity of 150 tons per day (TPD) which is in the vicinity to a major paddy growing area. MCRM procure paddy from farmers & local agents and sells its products through the wholesalers and distributors across West Bengal. MCNALLY SAYAJI: CARE Keeps D Debt Ratings in Not Cooperating ------------------------------------------------------------ CARE Ratings said the rating for the bank facilities of McNally Sayaji Engineering Limited (MSEL) continues to remain in the 'Issuer Not Cooperating' category. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term Bank 173.75 CARE D; ISSUER NOT COOPERATING Facilities Rating continues to remain under ISSUER NOT COOPERATING category Long Term/ 89.00 CARE D/CARE D; ISSUER NOT Short Term COOPERATING; Rating continues Bank Facilities to remain under ISSUER NOT COOPERATING category Detailed rationale and key rating drivers CARE had, vide its press release dated July 28, 2021, continued the ratings of MSEL under the 'issuer non-cooperating' category as MSEL 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. MSEL continues to be non-cooperative despite repeated requests for submission of information through phone calls and letters/emails dated June 13, 2022, June 23, 2022, July 3, 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 ratings. Detailed description of the key rating drivers At the time of last rating on July 28, 2021, the following were the rating strengths and weaknesses (updated for the information available from stock exchange fillings): Key Rating Weaknesses: * Ongoing delays in debt servicing: MSEL's liquidity position remains impacted due to losses. There are ongoing delays in debt servicing. The company is presently under Corporate Insolvency Resolution Process (CIRP). * Stretched operating cycle: MSEL has high working capital requirement due to elongated operating cycle. The average collection period was high at 163 days in FY22. Further, the inventory period was high at 189 days in FY22. Accordingly, the operating cycle is elongated. MSEL, incorporated in December 1943, is a subsidiary of McNally Bharat Engineering Co. Ltd belonging to the B. M. Khaitan group. The company has manufacturing units located at Vadodara (Gujarat), Kumardhubi (Jharkhand) and Asansol (West Bengal) engaged in the manufacturing of various construction and material handling equipment & spares and has slurry pump thickeners and floatation unit at Bengaluru (Karnataka). Besides, the company also has two windmills (aggregate capacity - 1.6 MW) at Jamnagar, Gujarat. MSR INDIA: CARE Lowers Rating on INR10cr LT Loan to D ----------------------------------------------------- CARE Ratings revised the ratings on certain bank facilities of MSR India Limited. (MSR), as: Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term Bank 10.00 CARE D; ISSUER NOT COOPERATING; Facilities Rating continues to remain under ISSUER NOT COOPERATING category and Revised from CARE B-; Stable Short Term Bank 3.00 CARE D; ISSUER NOT COOPERATING Facilities Rating continues to remain under ISSUER NOT COOPERATING category and Revised from CARE A4 Detailed Rationale & Key Rating Drivers CARE Ratings Ltd. had, vide its press release dated April 29, 2022, placed the rating(s) of MSR under the 'issuer non-cooperating' category as MSR had failed to provide information for monitoring of the rating for the rating exercise as agreed to in its Rating Agreement. MSR continues to be non-cooperative despite repeated requests for submission of information through e-mails dated August 22, 2022 and September 2, 2022, October 5, 2022, amongst others. In line with the extant SEBI guidelines, CARE Ratings Ltd. has reviewed the rating on the basis of the best available information which however, in CARE Ratings Ltd.'s opinion is not sufficient to arrive at a fair rating. Users of this rating (including investors, lenders and the public at large) are hence requested to exercise caution while using the above rating(s). The ratings have been revised as the lenders have classified the account as NPA. Detailed description of the key rating drivers At the time of last rating on April 29, 2022 the following were the rating strengths and weaknesses (updated for the information available from stock exchange): Key Rating Weakness Liquidity position - Poor The liquidity position of the company is poor, and the company has not been able to meet its debt repayment obligations. In 2007, MSR India Limited (MSR) had acquired Star Leasing Limited and changed its name to Remidicherla Power Ltd and ventured into power sector. Further, the company entered into Infrastructure segment and changed the name to Remidicherla Power & Infra Limited. Later during FY14, the company has moved into trading of Milk products & consumer goods and the company was renamed to MSR India Limited (MSR). Further, after establishing a proper distribution network MSR ventured into manufacturing of copper water bottles and consumer goods such as Pasta, Vermicelli and Chakki Atta since July 2016. The company is engaged in manufacturing of consumer goods such as Pasta, Vermicelli, Chakki Atta marketed under the brand name "Today", copper water bottles which are marketed under the brand "Dr. Copper". Also, the company manufactures battery cell cases for aerospace & defence industry. NANDAN BUILDCON: CARE Keeps D Debt Ratings in Not Cooperating ------------------------------------------------------------- CARE Ratings said the ratings for the bank facilities of Nandan Buildcon Private Limited (NBPL) continue to remain in the 'Issuer Not Cooperating' category. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term Bank 103.76 CARE D; ISSUER NOT COOPERATING Facilities Rating continues to remain under ISSUER NOT COOPERATING category Short Term Bank 25.00 CARE D; ISSUER NOT COOPERATING Facilities Rating continues to remain under ISSUER NOT COOPERATING category Detailed Rationale & Key Rating Drivers CARE Ratings Ltd. had, vide its press release dated August 18, 2021, placed the rating(s) of NBPL under the 'issuer non-cooperating' category as NBPL 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. NBPL continues to be noncooperative despite repeated requests for submission of information through e-mails, phone calls and a letter/email dated July 4, 2022, July 14, 2022, July 24, 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). NBPL is a part of 'NANDAN' Group, engaged in the construction of residential and commercial properties. Till date, the group has completed 34 projects in Pune through various group entities (SPVs, Partnership firms & AoP) with total saleable area admeasuring approximately 33.93 lakh square feet (lsf.). Apart from NBPL, Nandan group consists of Nandan Associates and Nandan VSP Developers. NARAYANI FLOUR: CARE Keeps C Debt Rating in Not Cooperating ----------------------------------------------------------- CARE Ratings said the rating for the bank facilities of Narayani Flour Mill (NFM) continues to remain in the 'Issuer Not Cooperating' category. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term Bank 1.20 CARE C; Stable; ISSUER NOT Facilities COOPERATING; Rating continues to remain under ISSUER NOT COOPERATING category Short Term 5.40 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 September 15, 2021, placed the rating(s) of NFM under the 'issuer non-cooperating' category as NFM 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. NFM continues to be non-cooperative despite repeated requests for submission of information through e-mails, phone calls and a letter/email dated August 1, 2022, August 11, 2022, August 21, 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). Narayani Flour Mill (NFM), established in December, 2011 as a partnership firm in the view of initiating a flour milling business in West Bengal. Currently the firm is operating as per partnership deed signed on December 2011. The firm has installed its manufacturing facility at Paraj, Burdwan with an installed capacity of 200 MT per day. NFM commenced commercial production from March 2012. The firm manufactures wheat flour and wheat bran. NFM procures wheat from the govt. of West Bengal and processes wheat flour and bran. After processing NFM keeps the bran with itself and sells the flour to Govt. of West Bengal. Further, NFM also caters to local wholesalers and retailers. NOVELTY REDDY: CARE Keeps C Debt Rating in Not Cooperating ---------------------------------------------------------- CARE Ratings said the rating for the bank facilities of Novelty Reddy And Reddy Motors Private Limited (NRRMPL) continues to remain in the 'Issuer Not Cooperating' category. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term Bank 10.00 CARE C; Stable; ISSUER NOT Facilities COOPERATING; Rating continues to remain under ISSUER NOT COOPERATING category Short Term 1.50 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 30, 2021, placed the rating(s) of NRRMPL under the 'issuer non-cooperating' category as NRRMPL 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. NRRMPL continues to be non-cooperative despite repeated requests for submission of information through e-mails, phone calls and a letter/email dated July 16, 2022, July 26, 2022, August 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). Novelty Reddy & Reddy Motors Private Ltd (NRRMPL) was incorporated in 2007, by Mr. G. Rama Krishna Reddy. NRRM is an authorized dealer for Maruti Suzuki India Ltd (MSIL) based in Bhimavaram and Tanuku (both in Andhra Pradesh). The company has dealership for selling entire range of passenger cars, spares and accessories of MSIL. NRRM belongs to Reddy and Reddy Group which has diverse interests including trading of prawns feed, authorized dealership of MSIL and Hero Honda. PRATIBHA MILK: CARE Keeps D Debt Rating in Not Cooperating ---------------------------------------------------------- CARE Ratings said the rating for the bank facilities of Pratibha Milk Industries (PMI) continues to remain in the 'Issuer Not Cooperating' category. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term Bank 54.93 CARE D; ISSUER NOT COOPERATING Facilities Rating continues to remain under ISSUER NOT COOPERATING category Detailed Rationale & Key Rating Drivers CARE Ratings Ltd. had, vide its press release dated September 6, 2021, placed the rating(s) of PMI under the 'issuer non-cooperating' category as PMI 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. PMI continues to be non-cooperative despite repeated requests for submission of information through e-mails, phone calls and a letter/email dated July 23, 2022, August 2, 2022, August 12, 2022. In line with the extant SEBI guidelines, CARE Ratings Ltd. has reviewed the rating on the basis of the best available information which however, in CARE Ratings Ltd.'s opinion is not sufficient to arrive at a fair rating. Users of this rating (including investors, lenders and the public at large) are hence requested to exercise caution while using the above rating(s). PMI is a partnership firm of Mr. Satish Chavan and his wife Mrs. Ashwini Chavan and is part of the Chavan Group. The group has its presence in milk business since 2002, and has been majorly engaged in trading of milk and milk products and government contract business till 2009. PRINCE MARINE: CARE Keeps D Debt Ratings in Not Cooperating ----------------------------------------------------------- CARE Ratings said the rating for the bank facilities of Prince Marine Transport Services Private Limited (PMTSPL) continues to remain in the 'Issuer Not Cooperating' category. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term Bank 6.32 CARE D; ISSUER NOT COOPERATING Facilities Rating continues to remain under ISSUER NOT COOPERATING category Short Term Bank 3.00 CARE D; ISSUER NOT COOPERATING Facilities Rating continues to remain under ISSUER NOT COOPERATING category Detailed Rationale & Key Rating Drivers CARE Ratings Ltd. had, vide its press release dated August 20, 2021, placed the rating(s) of PMTSPL under the 'issuer non-cooperating' category as PMTSPL 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. PMTSPL 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). PMTSPL was founded by Mr Abdul Razak in July 1993 as a proprietary firm. During the year 1994, it was converted into a partnership firm and then in 2007 into a private limited company. The company initially started with the business of hiring ships, vessels, barges, tugs and towage of vessels within Mumbai harbor limits as well as for ocean passages. During 1998, it ventured into the business of cargo lighterage. To capitalize on the opportunity of various services in the developing port sector, the company entered into dredging support services and bagged a dredging contract from JSW Jaigarh Port Ltd. in the year 2009. RAJ TRANSMISSION: Insolvency Resolution Process Case Summary ------------------------------------------------------------ Debtor: Raj Transmission Engineering Limited Plot No. 705, Industrial Area Phase 1, Chandigarh U.T. Chandigarh Insolvency Commencement Date: October 10, 2022 Court: National Company Law Tribunal, Chandigarh Bench Estimated date of closure of insolvency resolution process: April 5, 2023 Insolvency professional: CA Vivek Kumar Arora Interim Resolution Professional: CA Vivek Kumar Arora House No. 629, Sector 16-D Chandigarh E-mail: ip.vivekarora@gmail.com vivekkarora1@gmail.com ip.rajtransmissionengineering@ gmail.com Last date for submission of claims: October 21, 2022 RAJALAKSHMY PACKAGING: CARE Keeps D Ratings in Not Cooperating -------------------------------------------------------------- CARE Ratings said the rating for the bank facilities of Rajalakshmy Packaging Private Limited (RPPL) continues to remain in the 'Issuer Not Cooperating' category. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term Bank 9.00 CARE D; ISSUER NOT COOPERATING Facilities Rating continues to remain under ISSUER NOT COOPERATING category Short Term Bank 2.00 CARE D; ISSUER NOT COOPERATING Facilities Rating continues to remain under ISSUER NOT COOPERATING category Detailed Rationale & Key Rating Drivers CARE Ratings Ltd. had, vide its press release dated August 27, 2021, placed the rating(s) of RPPL under the 'issuer non-cooperating' category as RPPL 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. RPPL continues to be non-cooperative despite repeated requests for submission of information through e-mails, phone calls and a letter/email dated July 13, 2022, July 23, 2022, August 2, 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). Tamil Nadu based, Rajalakshmy Packaging Private Limited (RPPL) was established in 2008 as a Private Limited Company by Ms. S. Suresh Babu and his relatives. RPPL is engaged in the manufacturing of food and non-food grade flexible packaging. The company purchases raw materials like Linear Density Poly Ethylene (LDPE), Low Linear Density Poly Ethylene (LLDPE) and High-Density Poly Ethylene (HDPE) from local suppliers located in and around Tamil Nadu. The company sells its finished product to the customers located in and around Tamil Nadu. RATNAGARBHA AGRO: CARE Keeps D Debt Rating in Not Cooperating ------------------------------------------------------------- CARE Ratings said the rating for the bank facilities of Ratnagarbha Agro Private Limited (RAPL) continues to remain in the 'Issuer Not Cooperating' category. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term Bank 12.99 CARE D; ISSUER NOT COOPERATING Facilities Rating continues to remain under ISSUER NOT COOPERATING category Detailed Rationale & Key Rating Drivers CARE Ratings Ltd. had, vide its press release dated August 17, 2021, placed the rating(s) of RAPL under the 'issuer non-cooperating' category as RAPL 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. RAPL continues to be noncooperative 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). Hardoi (U.P) based Ratnagarbha Agro Private Limited (RAPL) was incorporated in February, 2007 by Mr. Shri Kishan Agrawal and his son Mr. Ram Kishan Agrawal. However, the company started its commercial operations in October 2013. RAPL is engaged in processing of wheat into refined flour (Maida), Suji and flour (Atta). S.G. POLYPLAST: CARE Keeps D Debt Ratings in Not Cooperating ------------------------------------------------------------ CARE Ratings said the ratings for the bank facilities of S.G. Polyplast Private Limited (SPPL) continue to remain in the 'Issuer Not Cooperating' category. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term Bank 7.00 CARE D; ISSUER NOT COOPERATING Facilities Rating continues to remain under ISSUER NOT COOPERATING category Short Term Bank 15.00 CARE D; ISSUER NOT COOPERATING Facilities Rating continues to remain under ISSUER NOT COOPERATING category Detailed Rationale & Key Rating Drivers CARE Ratings Ltd. had, vide its press release dated August 18, 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 non-cooperative despite repeated requests for submission of information through e-mails, phone calls and a letter/email dated July 4, 2022, July 14, 2022, July 24, 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). S. G. Polyplast Private Limited (SPPL), incorporated on April 15, 2009 at Delhi by Mr. Ajit Kumar Gupta carry out the trading of resins, polymers and other plastic raw materials. However, in the year July 2014 the company was taken over by the Jindal Group been promoted by Mr. Dalip Jindal along with his wife Mrs. Shaloo Jindal. The company is engaged in import of pulses (Red Lentils, Chickpeas, Green Peas, Yellow Peas, Pigeon Peas, Black Matpe, Green Moong and Lentils) from countries like Singapore, China, Canada, Australia, New Zealand and Russia. SPPL sells its product mostly in the domestic market through a network of wholesale dealers and brokers. SATISH MARINE: CARE Lowers Rating on INR51.01cr LT Loan to D ------------------------------------------------------------ CARE Ratings revised the ratings on certain bank facilities of Satish Marine Exim Private Limited (SMEPL), as: Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term Bank 51.01 CARE D; Revised from CARE BB; Facilities Stable Short Term Bank Facilities 1.50 CARE D Assigned Detailed rationale and key rating drivers The revision in ratings assigned to the bank facilities of SMEPL factors in stretched liquidity due to delay in realization of receivables resulting in ongoing delays in payment of debt obligation. The ratings are further tempered by small sized entity with limited track record, leveraged capital structure with high reliance on working capital borrowings, stretched operating cycle, exposure to various water borne diseases, raw material price fluctuation risk, intense competition and operations being exposed to national and international regulations. Nevertheless, the ratings derive comfort from experienced promoters in the aquaculture industry, location advantages ascribed to presence in the aquaculture zone of Andhra Pradesh, and government support to seafood industry. Rating sensitivities Positive factors – Factors that could lead to positive rating action/upgrade: * Improvement in liquidity position with subsequent regularization of debt servicing with delay free track record for a continuous period of at least 3 months Detailed description of the key rating drivers Key rating weaknesses * Ongoing delays in debt servicing: SMEPL faced liquidity crunch during past 4 months due to delay in realisation of debtors which subsequently resulted in delays in debt servicing. The delays were regularised with in a period of about 20 days from the date of payment becoming due. Delay in debtors' realization also resulted in increased reliance on working capital borrowings. Utilisation of funds based working capital limits for last 12 months ended September 2022 is almost full. * Stretched operating cycle: Operating cycle of SMEPL continues to remain stretched due to delay in recovery of debtors. Outstanding debtors as of March 31, 2022 increased to INR 29.21 crore compared to INR 10.88 crore as of March 31, 2021. Collection period remained at 51 days in FY22. SMEPL maintains inventory of about 3 months. Inventory period in FY22 remained at 88 days (FY21: 98 days). High inventory and collection period had resulted in stretched operating cycle of 84 days. Small sized entity amid limited track record: Although the promoters are experienced, the company has limited track record of operations about 3 years. Company is a small sized entity marked by low net-worth base of Rs 23.77 crore as on March 31, 2022 and total operating income of INR 141.71 crore in FY22. * Leveraged capital structure and moderate coverage indicators: As on March 31, 2022, debt profile of SMEPL consists of term loans, working capital limits, GECL loans and unsecured loans from related parties. The capital structure of the company stood leveraged marked by overall gearing at 2.28x as on March 31, 2022 (PYE: 2.77x) despite improvement. Also, the TNW remains small at about Rs 23.77 crore as on March 31, 2022, rendering the capital structure leveraged. The debt coverage indicators of the company also remained moderate marked by PBILDT interest coverage ratio and total debt to GCA stands at 2.83x and 10.52x in FY22 against 1.83x and 16.32x in FY21. * Exposure to various water borne diseases: There are varieties of lethal viral and bacterial diseases that may affect shrimp. The fact that the shrimps are kept in clusters, acts as an exponential factor in multiplying the disease caught by a single shrimp and wipe out the almost 90% of total shrimp population in a particular farm. A major transfer vector of many of these viruses is the water itself; and thus, any virus outbreak also carries the danger of decimating shrimp living in the wild. Hence, taking care of farmed shrimp is important. However, after repeated tests, Vannamei shrimps have been observed to be more resistant than Black Tiger shrimps to various diseases. * Low entry barriers resulting in intense competition: The industry is characterized by low entry barriers due to minimal capital required which has resulted in increase of large number of small and large traders & producers spread across the nation. Furthermore, the growing volume of frozen shrimps in India has encouraged many players to set up seafood processing units, feeds manufacturing facility and cold storage chains to take part in the potential growth in seafood export industry. The same has resulted in increased competition among the players. Given the low entry barriers and significant competition in the export market from other competing countries and threat from other sea food varieties, the profitability margins tend to remain modest. * Raw material price fluctuation risk: Raw material cost is the major cost element for the company with contribution of ~75% to the cost of sales in FY22 (compared to ~66% in FY21). SMEPL procures raw materials from local farmers or through its agents on mutual price bargain. The raw material availability and prices vary year on year depending upon the crop yield, demand and supply scenario and is also subject to vagaries of nature. Key rating strengths * Experienced promoters in the aquaculture industry: SMPL was incorporated in August 2015 by Mr. Annam Satish Prabhakar and Mrs. Annam Lakshmi Aparna. The day-to-day operations and selling & marketing activities are managed by Mr. Annam Satish Prabhakar (Managing Director) with experience of more than decade and half in the shrimp industry. Mr. Prabhakar and Mrs. Aparna have prior experienced in the seafood processing and exports with different companies. The promoters together have 250 acres of land under prawn cultivation and have established relationship with local cultivators, processing units and suppliers. The established relationship of the promoters with local farmers and exporters and their experience in the aquaculture industry is expected to garner new business for the company and increase the scale of operations in future. * Improved financial and operational performance during FY22: In FY22, total operating income (TOI) of the company increased by about 1.5x from INR 57.75 crores to INR 141.71 crores at the back of increase in demand for shrimp products. During FY22, company has achieved a capacity utilisation of 63% (PY: 50%). With increased TOI, profitability levels increased by 24.62% to INR9.11 crores. With interest and depreciation cost remaining almost similar to that of FY21 coupled with improved profitability levels, PAT increased to INR 2.46 crores in FY22 against 0.22 crores in FY21. * Location advantages ascribed to presence in the aquaculture zone of Andhra Pradesh resulting in adequate availability of raw material: The villages in Prakasam, Nellore, Krishna, Guntur, East and West Godavari districts are the hubs of freshwater shrimp and fish farming. SMPL's processing plant is strategically located at Yazalli village, Guntur District, enabling the company to procure raw materials efficiently and process them immediately after harvest, thereby ensuring uninterrupted access to raw material. This results in better quality of the product and lower transportation costs. The company procures raw material from major coastal regions of A.P. viz. Bhimavaram, Kakinada, Guntur, Amalapuram, Ongole and Krishna district. The company is exporting to countries like Middle East, Japan, China, Mauritius, UAE etc. * Government support to seafood industry: The World Trade Organization's (WTO) had raised objection on MEIS incentive being in violation of free trade norms asking India to roll back the scheme. Subsequently, Govt of India has started a new scheme named RODTEP (Remission of Duties and Taxes on Export Products). However, the benefits/impact of all such schemes are normally passed on across the value chain i.e. farmers, wholesalers, processors, exporters and the importing countries and thus the profitability margins of exporters continue to remain unwavering. * Industry Outlook: India's marine product exports record an all-time high in FY 2021-22; Grow by over 30% to Rs 57,586.48 crore (USD 7.76 billion) India shipped 13,69,264 MT of seafood worth Rs 57,586.48 crore (USD 7.76 billion) during 2021-22, despite heavy odds. During the FY 2021-22, the export improved in rupee term by 31.71%, in USD terms by 30.26% and in quantity terms by 19.12%. Frozen shrimp remained the major export item in terms of quantity and value. Frozen shrimp, which earned Rs 42,706.04 crore (USD 5,828.59 million), accounted for a share of 53.18 per cent in quantity and 75.11 per cent of the total dollar earnings. The market is expected to grow by CAGR 10.59% for the period 2022-2027. Liquidity: Stretched Stretched liquidity is marked by tightly matched gross cash accruals of INR5.15 crores against gross annual repayment obligations to the tune of 4.75 crores. The average utilisation of limits stood at 100% for last 12 months ended SepteMber 2022. Company has cash and bank balance of INR1.99 crores as on March 31, 2022 which includes DSRA amount of INR1.00 crore. Satish Marine Exim Private Limited (SMPL) was incorporated in August, 2015 by Mr. Annam Satish Prabhakar and Mrs. Annam Lakshmi Aparna. SMPL is primarily engaged in processing and export of Vannamei shrimps at its processing facility located at Yazalli village, Guntur District, Andhra Pradesh with an annual production capacity of 6,480 Metric Tonnes (MT). The company has started commercial operations in November 2019. SATURN RINGS: CARE Keeps D Debt Rating in Not Cooperating Category ------------------------------------------------------------------ CARE Ratings said the rating for the bank facilities of Saturn Rings & Forgings Private Limited (SRFPL) continues to remain in the 'Issuer Not Cooperating' category. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term Bank 40.00 CARE D; ISSUER NOT COOPERATING Facilities Rating continues to remain under ISSUER NOT COOPERATING category Detailed Rationale & Key Rating Drivers CARE Ratings Ltd. had, vide its press release dated August 20, 2021, placed the rating(s) of SRFPL under the 'issuer non-cooperating' category as SRFPL 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. SRFPL 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). Incorporated in 2012, Saturn Rings & Forgings Private Limited (SRFPL) is engaged in manufacturing of bearing rings and other forged component products and operates out of plant situated at Shirwal, Pune. SENBO ENGINEERING: CARE Keeps D Debt Ratings in Not Cooperating --------------------------------------------------------------- CARE Ratings said the rating for the bank facilities of Senbo Engineering Limited (SEL) continues to remain in the 'Issuer Not Cooperating' category. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term Bank 142.68 CARE D; ISSUER NOT COOPERATING Facilities Rating continues to remain under ISSUER NOT COOPERATING category Short Term Bank 157.32 CARE D; ISSUER NOT COOPERATING Facilities Rating continues to remain under ISSUER NOT COOPERATING category Detailed Rationale & Key Rating Drivers CARE Ratings Ltd. had, vide its press release dated August 4, 2021, placed the rating(s) of SEL under the 'issuer non-cooperating' category as SEL 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. SEL continues to be non-cooperative despite repeated requests for submission of information through e-mails, phone calls and a letter/email dated June 20, 2022, June 30, 2022, July 10, 2022. In line with the extant SEBI guidelines, CARE Ratings Ltd. has reviewed the rating on the basis of the best available information which however, in CARE Ratings Ltd.'s opinion is not sufficient to arrive at a fair rating. Users of this rating (including investors, lenders and the public at large) are hence requested to exercise caution while using the above rating(s). Senbo Engineering Limited (SEL) was initially established as Senbo & Company, a proprietorship entity by one Mr. Kajal Sengupta in Kolkata, West Bengal. The entity was reconstituted as private limited company on July 13, 1990 and later incorporated as a public limited company in April, 2005. SEL is engaged in construction of underground tunnelling, station for metro railways, flyovers and bridges. Over the decades, it has executed few medium sized metro railways contracts in Kolkata and New Delhi, besides completing few flyover projects. Further, SEL also execute work orders in joint venture with other companies. Currently, the day to day affairs of the company is looked after by Mr. Kajal Sengupta (chairman and managing director) well supported by other directors. SHANTI HOSPITAL: CARE Keeps D Debt Rating in Not Cooperating ------------------------------------------------------------ CARE Ratings said the rating for the bank facilities of Shanti Hospital continues to remain in the 'Issuer Not Cooperating' category. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term Bank 14.27 CARE D; ISSUER NOT COOPERATING Facilities Rating continues to remain under ISSUER NOT COOPERATING category Detailed rationale and key rating drivers Shanti Hospital has failed to provide information for the rating exercise as agreed to in its rating agreement despite repeated requests through phone calls and email dated August 31, 2022, September 9, 2022, September 23, 2022, and September 27, 2022. In line with the extant SEBI guidelines, CARE's rating on Shanti Hospital's bank facilities will now be denoted as CARE D; ISSUER NOT COOPERATING. Users of this rating (including investors, lenders and the public at large) are hence requested to exercise caution while using the above rating) Detailed description of the key rating drivers At the time of last rating, on August 5, 2021 the following were the rating strengths and weaknesses: Key Rating Weakness * Debt servicing track record: Delays are observed in term loan repayments during last 12 months by 1-3 days due to stretched liquidity. While the firm has been regular in repayments for past 3 months, but with relatively high upcoming repayments and weak debt coverage indicators, firm's ability to maintain delay free track record on sustained basis remains to be seen. * Decline in scale of operations: The coronavirus pandemic has dented the performance of the hospital with significant decline in occupancy. Elective surgeries which contributes for 60-70% revenue was postponed by the patients due to lockdown constraints and fear of catching covid infection. The scale of operations of the firm declined to INR6.55 Cr during FY21 from INR10.65 Cr in FY20. However, the revenue has seen improvement during Q1FY22 with TOI of INR2.65 Cr. * Weak debt coverage indicators: The debt coverage indicators of the firm remained weak relected by interest coverage ratio of 3.73x as on March 31, 2021 deteriorated from 10.13x (PY) due to increase in interest cost on account of ongoing capex. Further, total debt to GCA stood low at 11.14x in FY21. * Project risk: The firm has started setting up a new super speciality hospital at Navanagar, Bagalkot in 2018 to expand its scale of operations with aggregate cost of INR18.00 cr and the same was supposed to be completed by December 2019. However, the firm has revised the project by adding two more floors to the proposed building with an additional cost of INR4.92 crore. As per the revised terms, the total project cost is INR22.92 crore and was expected to be completed by January 2021. The cost of the project has been further revised by INR1.84 cr due to increase in building cost of phase 1 and 2. The 2 CARE Ratings Limited Press Release revised expected cost of the project is INR24.76 cr and is expected to be completed by end of September 2021 and the firm is expecting its operations to commence from first week of October 2021. * High vulnerability to treatment-related risks and regulatory risks: Healthcare is a highly sensitive sector where any mishandling of a case or negligence on the part of any doctor and/or staff of the unit can lead to distrust among the masses. Thus, all the healthcare providers need to monitor each case diligently and maintain high operating standard to avoid the occurrence of any unforeseen incident which can damage the reputation of the hospital to a large extent. Further, the operations of hospital are subject to various rules and regulations laid by respective authorities at State and Central government level. Any instance of non-compliance of these rules and regulations would impact the operations of hospital resulting into deterioration of financial risk profile of the company. * Highly competitive due to organiszed and established players: The hospital industry is highly competitive with a large number of established organized players and their growing network. The healthcare and specialty hospitals sector mainly comprises of large national level players, organized regional players, government hospitals, charitable trusts and a large number of nursing home and Multi-specialty clinics making it highly competitive. * Constitution of the entity as a partnership firm with inherent risk of withdrawal of capital: The firm being a partnership firm is exposed to inherent risk of capital withdrawal by the partners, due to its nature of constitution. Further, any substantial withdrawals from capital account would impact the net worth and thereby the financial profile of the firm. Key Rating Strengths * Qualified and experienced partners for more than three decades in medical professional services: SH is promoted by Dr. Rajendra Patil and Dr. Sunil Biradar Patil. Dr. Rajendra Patil and Dr. Sunil Biradar Patil both are Pediatricians ,and have more than three decades of experience and more than one decade of experience respectively with this entity. The firm has well qualified and experience staff to serve its patients. * Wide range of healthcare services: The hospital provides services in about 12 departments including, Pediatrics, Otolaryngology, Gastroenterology, General Medicine, General Surgery, Neonatology, Neurosurgery, ophthalmology, Pediatric Cardiology, Pediatric Surgery, Pediatric Neurology and Orthopedic Surgery among others. These wide range of services offered by firm at competitive rates resulted in fair occupancy rate in recent past. Liquidity: Stretched Liquidity is marked by tightly matched accruals to repayment obligations, low cash balance of INR0.11 Crore and below unity current ratio of 0.18x as on March 31, 2021 and higher working capital utilisation of 90% during the last twelve months. Further, the firm has availed GECL term loan of INR1.2 Cr. Shanti Hospital (SH) initially started its operations in 1986, with a constitution of Hindu Undivided Family (HUF), and was then known as Shanti Children Hospital. Later, the entity was converted into Partnership firm in 2008. In 2011 the firm changed its name to current nomenclature. Currently, SH has 100 beds, operational in Bagalkot, Karnataka and is promoted by Dr. Rajendra Patil and Dr. Sunil Biradar Patil. It is a Multi-Specialty Hospital spread across a cumulative area of 35,000 sq. ft. with modern equipment and infrastructure. SHIV GORAKH: CARE Keeps D Debt Ratings in Not Cooperating Category ------------------------------------------------------------------ CARE Ratings said the ratings for the bank facilities of Shiv Gorakh Timber Private Limited (SGTPL) continue to remain in the 'Issuer Not Cooperating' category. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term Bank 1.25 CARE D; ISSUER NOT COOPERATING Facilities Rating continues to remain under ISSUER NOT COOPERATING category Short Term Bank 10.00 CARE D; ISSUER NOT COOPERATING Facilities Rating continues to remain under ISSUER NOT COOPERATING category Detailed Rationale & Key Rating Drivers CARE Ratings Ltd. had, vide its press release dated August 25, 2021, placed the rating(s) of SGTPL under the 'issuer non-cooperating' category as SGTPL 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. SGTPL continues to be noncooperative despite repeated requests for submission of information through e-mails, phone calls and a letter/email dated July 11, 2022, July 21, 2022, July 31, 2022. In line with the extant SEBI guidelines, CARE Ratings Ltd. has reviewed the rating on the basis of the best available information which however, in CARE Ratings Ltd.'s opinion is not sufficient to arrive at a fair rating. Users of this rating (including investors, lenders and the public at large) are hence requested to exercise caution while using the above rating(s). The entity was established as a proprietorship firm in 1996 under the name of 'Shiv Gorakh Timber' by Mr. Ravinder Mittal. It was later converted into private limited company in February 2010. The company is being currently being managed by Mr. Devinder Mittal and Mr. Ravinder Mittal. The company is engaged in trading of timber wood and timber logs at its facilities located in Haryana, Gujarat and Punjab. SHREEJI CONSTRUCTION: CARE Keeps D Debt Rating in Not Cooperating ----------------------------------------------------------------- CARE Ratings said the rating for the bank facilities of Shreeji Construction Company_Vadodara (SCC) continues to remain in the 'Issuer Not Cooperating' category. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term Bank 8.50 CARE D; ISSUER NOT COOPERATING Facilities Rating continues to remain under ISSUER NOT COOPERATING category Detailed Rationale & Key Rating Drivers CARE Ratings Ltd. had, vide its press release dated September 21, 2021, placed the rating(s) of SCC under the 'issuer non-cooperating' category as SCC 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. SCC continues to be non-cooperative despite repeated requests for submission of information through e-mails, phone calls and a letter/email dated August 7, 2022, August 17, 2022, August 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). Halol (Gujarat) based Shreeji Construction Co. (SCC) was established as a Partnership firm in 2014 by three partners i.e. Mr. Gopal Patel, Mr. Shreeji Patel and Mr. Chirag Patel. The firm is engaged into real estate activities. Currently, the firm is executing a commercial real estate project 'SHREEJI ARCADE' consisting of 270 shops at Halol, Pachamama. The construction of said project was started in October, 2014 with the total estimated cost of INR18.35 crore and the firm has incurred 83% of total estimated cost till May 31, 2018 and the rest will be incurred and project will be completed by March, 2019. The firm has been granted RERA registration under project registration no. PR/GJ/ PANCHMAHAL/HALOL/Others/ CAA02682/160518. TULSYAN NEC: CARE Keeps D Debt Ratings in Not Cooperating --------------------------------------------------------- CARE Ratings said the ratings for the bank facilities of Tulsyan NEC Limited (TNECL) continue to remain in the 'Issuer Not Cooperating' category. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term Bank 830.82 CARE D; ISSUER NOT COOPERATING Facilities Rating continues to remain under ISSUER NOT COOPERATING category Short Term Bank 142.16 CARE D; ISSUER NOT COOPERATING Facilities Rating continues to remain under ISSUER NOT COOPERATING category Detailed rationale and key rating drivers CARE Ratings Limited (CARE Ratings) had, vide its press release dated July 23, 2021, placed the ratings of TNECL under the 'issuer non-cooperating' category, as TNECL had failed to provide information for monitoring of the rating as agreed to in its rating agreement. TNECL continues to be non-cooperative despite repeated requests for submission of information through e-mails dated June 12, 2022, June 22, 2022, June 28, 2022 and October 6, 2022. In line with the extant SEBI guidelines, CARE Ratings has reviewed the rating on the basis of the best available information, which, however, in CARE Ratings' opinion is not sufficient to arrive at a fair rating. Users of this rating (including investors, lenders and the public at large) are hence requested to exercise caution while using the above rating(s). Detailed description of the key rating drivers At the time of last rating on July 23, 2021, the following were the rating weaknesses (updated for the stock exchange filings by the company): Key rating weaknesses * Ongoing delays in debt servicing: The ratings continue to take into account the ongoing delays in the debt servicing by the company due to poor liquidity position. Based on the stock exchange filings by TNECL, CARE Ratings understands that the company is in discussions with its lenders regarding one-time settlement (OTS) of the defaulted loan amounts. In its stock exchange filings, TNECL has mentioned that, its Board of Directors have approved and accepted the terms and conditions of the OTS proposal received from certain lenders. * Weak financial and operational risk profile: Though the total operating income (TOI) of the company grew by 32.8% from INR566 crore in FY21 (refers to the period April 1 to March 31) to INR752 crore in FY22, the PBIDT margins have declined from 3.81% in FY21 to 1.95% in FY22 due to high raw material costs, which were around 75% of TOI in FY22 as against around 70% of TOI in FY21. During Q1FY23, the company has registered revenue of INR279 crore with PBIDT margin of 5.60%. Key rating strengths * Experienced management team with reasonable track record of operations: Over the years, under the leadership of Lalit Kumar Tulsyan and Sanjay Tulsyan, the company has grown into one of the major producers of secondary steel products like TMT Bars in the southern region. The management team has over three decades of experience in the steel business. Incorporated in the year 1947 under the name National Engineering Company Limited (NECL), the company was taken over by the Tulsyan group of companies in 1986. TNEC is into manufacturing of TMT bars and billets, high-density poly ethelene (HDPE)/ poly propylene (PP) sacks and flexible intermediate bulk containers (FIBC) in the region. TNEC approached the bankers for Corporate Debt Restructuring (CDR) in May 2014. However, continued unfavourable industry scenario led to the company's liquidity position remaining stretched, resulting in delays. VISHWA (DWARAKA-OKHA): CARE Keeps D Rating in Not Cooperating ------------------------------------------------------------- CARE Ratings said the rating for the bank facilities of Vishwa (dwarakA-Okha) Road Links Private Limited (VRLPL) continues to remain in the 'Issuer Not Cooperating' category. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term Bank 80.00 CARE D; ISSUER NOT COOPERATING Facilities Rating continues to remain under ISSUER NOT COOPERATING category Detailed Rationale & Key Rating Drivers CARE Ratings Ltd. had, vide its press release dated August 27, 2021, placed the rating(s) of VRLPL under the 'issuer non-cooperating' category as VRLPL 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. VRLPL continues to be non-cooperative despite repeated requests for submission of information through e-mails, phone calls and a letter/email dated July 13, 2022, July 23, 2022, August 2, 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). Vishwa (Dwarka-Okha) Roads Links Private Limited (VRLPL) is a Special Purpose Vehicle (SPV) promoted by Vishwa Infrastructures and Services Private Limited (Vishwa), as a 100% subsidiary of Vishwa. The SPV has been awarded the bid by the Roads and Buildings Department, Government of Gujarat ("R&BD, GOG), for development of Dwarka – Mithapur – Okha Port from km 232.00 to km 262.20 (30.2 kms) on State Highway No 25 and the section Sikka Patia – Sikka from km 22.20 to km 27.30 (5.1 km) on State Highway No 92 in Gujarat on Design, Build, Finance, Operate and Transfer (DBFOT) Annuity basis in the state of Gujarat. The aggregate cost of the project is INR129.53 crore (increased from INR118.10 crore) and the same is funded by debt from banks to the tune of INR100.96 crore and balance equity by the promoters. VIZEBH AGRI: CARE Keeps D Debt Rating in Not Cooperating Category ----------------------------------------------------------------- CARE Ratings said the rating for the bank facilities of Vizebh Agri - Sciences Private Limited (VASPL) continues to remain in the 'Issuer Not Cooperating' category. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term Bank 11.87 CARE D; ISSUER NOT COOPERATING Facilities Rating continues to remain under ISSUER NOT COOPERATING category Detailed Rationale & Key Rating Drivers CARE Ratings Ltd. had, vide its press release dated August 10, 2021, placed the rating(s) of VASPL under the 'issuer non-cooperating' category as VASPL 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. VASPL continues to be non-cooperative despite repeated requests for submission of information through e-mails, phone calls and a letter/email dated June 26, 2022, July 6, 2022, July 16, 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). Vadodara-based (Gujarat), VASPL was incorporated during July, 2010 by two promoters namely Mr.Amrish Patel and Mr.Jinesh Patel. The company is in the business of manufacturing of dairy products such as milk, curd, cow ghee, butter, flavoured milk, lassi etc. and operates with an installed capacity of 100,000 litres per day for milk processing. The company sells its products under the brand name "Vizee" in Gujarat, Punjab, Haryana, Jammu & Kashmir, Himachal Pradesh etc. Milk is the primary raw material for the company which they procure from their own milk chilling centres. VIZEBH COMPOSITECH: CARE Keeps D Debt Rating in Not Cooperating --------------------------------------------------------------- CARE Ratings said the rating for the bank facilities of Vizebh Compositech Private Limited (VCPL) continues to remain in the 'Issuer Not Cooperating' category. Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term Bank 15.00 CARE D; ISSUER NOT COOPERATING Facilities Rating continues to remain under ISSUER NOT COOPERATING category Detailed Rationale & Key Rating Drivers CARE Ratings Ltd. had, vide its press release dated August 5, 2021, placed the rating(s) of VCPL under the 'issuer non-cooperating' category as VCPL 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. VCPL continues to be noncooperative despite repeated requests for submission of information through e-mails, phone calls and a letter/email dated June 21, 2022, July 1, 2022, July 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). Gujarat (Vadodara) based VCPL was incorporated in October, 2013 by Mr. Pradeep Mahalik, Mr. Amrish Patel, and Mr. Jinesh Patel. VCPL is into manufacturing of different variants of composites, including non-composites, sheet-moulding compound/dough-moulding compound/bulk-moulding compound, fiber-reinforced polymers, carbon composites, composites advanced material, and thermoplastic polymer products. The company has started its commercial production from March, 2016. ===================== N E W Z E A L A N D ===================== LOYAL VENTURE: Court to Hear Wind-Up Petition on Oct. 31 -------------------------------------------------------- A petition to wind up the operations of Loyal Venture Trading Limited will be heard before the High Court at Tauranga on Oct. 31, 2022, at 10:00 a.m. The Commissioner of Inland Revenue filed the petition against the company on Aug. 25, 2022. The Petitioner's solicitor is: T. Saunders Inland Revenue, Legal Services 21 Home Straight PO Box 432 Hamilton OPTIC SECURITY: Calibre Partners Appointed as Receivers ------------------------------------------------------- Neale Jackson and Brendon James Gibson of Calibre Partners on Oct. 17, 2022, were appointed as Receivers and Managers of Optic Security Group Limited. The Receivers can be reached at: Calibre Partners Level 21 88 Shortland Street Auckland OPTIC SECURITY: First Creditors' Meeting Set for Oct. 27 -------------------------------------------------------- A first meeting of the creditors in the proceedings of Optic Security Group Limited will be held on Oct. 27, 2022, at 10:00 a.m. at the offices of Grant Thornton, Level 4, 152 Fanshawe Street, in Auckland. David Ian Ruscoe and Malcom Russell Moore of Grant Thornton were appointed as voluntary administrators of the company on Oct. 17, 2022. P C HAAK: Court to Hear Wind-Up Petition on Nov. 11 --------------------------------------------------- A petition to wind up the operations of P C Haak Mechanical Limited will be heard before the High Court at Auckland on Nov. 11, 2022, at 10:45 a.m. The Commissioner of Inland Revenue filed the petition against the company on April 11, 2022. The Petitioner's solicitor is: Cloete Van Der Merwe Inland Revenue, Legal Services 5 Osterley Way Manukau City Auckland 2104 PIRATE CREW: Court to Hear Wind-Up Petition on Oct. 31 ------------------------------------------------------ A petition to wind up the operations of The Pirate Crew Limited will be heard before the High Court at Tauranga on Oct. 31, 2022, at 10:00 a.m. The Commissioner of Inland Revenue filed the petition against the company on Sept. 21, 2022. The Petitioner's solicitor is: T. Saunders Inland Revenue, Legal Services 21 Home Straight PO Box 432 Hamilton ===================== P H I L I P P I N E S ===================== SQUIDPAY: Founder Faces Ban from Holding Key Positions in NBFI -------------------------------------------------------------- Eileen Mencias at Bilyonaryo.com reports that SquidPay Technology Inc. founder and CEO Marvin dela Cruz risks being disqualified from holding a key position in a nonbank financial institution because of the case filed against him over nonpayment of a PHP100-million loan. According to Bilyonaryo.com, the Manila Regional Trial Court issued a freeze order on the assets of Mr. Dela Cruz and Squidpay in response to the complaint filed by Brandon Benito Leong of Nuovo Gran CT Inc. due to non-payment of a loan that was due last June. SquidPay is one of 42 nonbank electronic money issuers authorized by the BSP and one of 229 registered to operate a payment system. The BSP's fit and proper rule requires that banks and entities under its supervision examine the integrity and probity of their officers and directors, Bilyonaryo.com notes. "In assessing an officer's integrity/probity, consideration shall be given to the officer's market reputation, observed conduct and behavior, as well as his ability to continuously comply with company policies and applicable laws and regulations, including market conduct rules, and the relevant requirements and standards of any regulatory body, professional body, clearing house or exchange, or government and any of its intrumentalities/agencies," according to the BSP's manual of regulation for nonbank financial institutions, Bilyonaryo.com relays. Officers and directors can also be temporarily disqualified if they "have shown unwillingness to settle their financial obligations . . ." Bilyonaryo.com relates that the financial obligations include their own loans as well as loans in which a director or official acted as a guarantor or endorser or as surety for the loans as well as obligations incurred by their spouse unless these were incurred after they have legally separated their properties. Directors/officers with pending cases before a court or other tribunal for dishonesty or breach of trust and violations of securities and banking laws, rules and regulations also face temporary disqualification, according to Bilyonaryo.com. Bilyonaryo.com says the BSP keeps a watchlist of people who are permanently and temporarily disqualified to hold positions in banks and other financial institutions under its supervision. Those permanently disqualified are those convicted by final judgement by a court for offenses involving dishonesty or breach of trust while those temporarily disqualified because of an unsettled obligation will need to pay up first and avoid a conviction. SquidPay -- http://squidpay.ph/-- is an e-payments platform that provides electronic payments and collection through a stored value card and mobile application. ================= S I N G A P O R E ================= NIGELLA SG: Creditors' Proofs of Debt Due on Nov. 22 ---------------------------------------------------- Creditors of Nigella Sg Pte. Ltd. are required to file their proofs of debt by Nov. 22, 2022, to be included in the company's dividend distribution. The company commenced wind-up proceedings on Oct. 14, 2022. The company's liquidators are: Ong Kok Yeong David c/o Tricor Singapore Pte. Ltd. 80 Robinson Road #02-00 Singapore 068898 PRIME POINT: Creditors' Proofs of Debt Due on Nov. 21 ----------------------------------------------------- Creditors of Prime Point Realty Development Pte. Ltd. are required to file their proofs of debt by Nov. 21, 2022, to be included in the company's dividend distribution. The company commenced wind-up proceedings on Oct. 21, 2022. The company's liquidator is: Mdm Chia Lay Beng 1 Scotts Road #21-07 Shaw Centre Singapore 228208 SEVEN STAR: Creditors' Proofs of Debt Due on Nov. 21 ---------------------------------------------------- Creditors of Seven Star Trading (S) Pte Ltd are required to file their proofs of debt by Nov. 21, 2022, to be included in the company's dividend distribution. The company commenced wind-up proceedings on Oct. 14, 2022. The company's liquidators are: R Rahul Raj c/o 17 Phillip Street #05-02 Grand Building Singapore 048695 THONG YONG: Deloitte Appointed as Liquidators --------------------------------------------- Lim Loo Khoon and Terrence Chin Khee Loon of Deloitte on Oct. 17, 2022, were appointed as provisional liquidators of Thong Yong International Pte Ltd, Thong Yong 2000 Marine Pte Ltd and Celebes Lines Pte Ltd. VIOLET OON: Court to Hear Wind-Up Petition on Oct. 28 ----------------------------------------------------- A petition to wind up the operations of Violet Oon Inc. Pte. Ltd . will be heard before the High Court of Singapore on Oct. 28, 2022, at 10:00 a.m. Oon Swee Gek, Tay Su-Lyn, and Tay Yiming filed the petition against the company on Oct. 3, 2022. The Petitioner's solicitors are: Drew & Napier LLC 10 Collyer Quay #10-01 Ocean Financial Centre Singapore 049315 ===================== S O U T H K O R E A ===================== [*] SOUTH KOREA: Builders Face Bankruptcy Concerns -------------------------------------------------- Park Jae-hyuk at The Korea Times reports that South Korean builders are facing growing concerns over the possibility of a series of bankruptcies amid worsening investor sentiment in the wake of the recent slump in the real estate market, according to industry officials, Oct. 20. Late last month, Wooseok Construction, a medium-sized builder based in South Chungcheong Province, failed to repay its debt in time, the report recalls. If the company fails to make the payment again, it will be forced into bankruptcy. The Korea Times relates that the builder's financial risk is mainly attributed to soaring raw material prices, so most other provincial builders are also feared to follow Wooseok, given that they sought rapid expansions when the real estate market was overheating. Data provided by the Ministry of Land, Infrastructure and Transport to Rep. Kim Byung-wook of the main opposition Democratic Party of Korea showed that eight builders went bankrupt during the first seven months of this year, The Korea Times discloses. Among them was a large-size builder that had been paid over KRW50 billion ($35 million) for its construction works during the previous year. According to the data, 12 construction firms went broke last year and none of them were paid over KRW50 billion for their works a year earlier, The Korea Times relays. "If builders go bankrupt one after another amid fears of a perfect storm, there will be a vicious cycle of a rising unemployment rate and the economic recession," the reports quotes Rep. Kim as saying. "The Financial Services Commission and the land ministry should take measures to prevent builders from going broke." After Lotte E&C announced on Oct. 18 that it decided to issue new shares worth KRW200 billion, concerns have even emerged over the financial soundness of larger builders, according to the report. A rumor even spread among securities industry officials earlier last week that Lotte E&C's financial difficulties caused a setback in the fundraising of its affiliate, Lotte Capital, although both companies denied the rumor, the report relates. "In collaboration with the group and affiliates, we have maintained a stable financial structure," Lotte E&C said in a press release. The Korea Times adds that Korea Investment & Securities analyst Kang Kyung-tae supported the claim, saying that it is inappropriate to forecast a large builder's possible bankruptcy at this moment. "All possible negative factors regarding the construction industry have been reflected in their stock prices," the analyst said. =============== T H A I L A N D =============== THAI AIRWAYS: Bankruptcy Court Approves Bid to Amend Plan --------------------------------------------------------- The Central Bankruptcy Court on Oct. 20, 2022, issued an order approving the proposal for the amendment of the Business Reorganization Plan of Thai Airways International Public Company Limited. On July 1, 2022, the Plan Administrator of the Company submitted the petition to amend the Plan to the Official Receiver. On July 1, 2022, the Official Receiver convened the creditors' meeting via electronic means (e-Meeting). The creditors with the aggregated sum of their debt amount equivalent to 78.59% of the debt amount of all creditors that attended the creditors' meeting and casted their vote, accepted the proposal for the Plan amendment. Later on, during the Central Bankruptcy Court's hearing stage, some creditors submitted an objection to the Central Bankruptcy Court. The summary of the Court's order are as follows: (1) The Plan amendment on the debt repayment, by conversion of the existing debt to a newly issued ordinary share to the Ministry of Finance, Financial Institution Creditors, and Debentures Creditor, has a timeframe for paying the debts to each creditor in the same class equally by 31 December 2024. Additionally, the Plan Administrator must study and determine an appropriate price of newly issues ordinary share for the existing shareholders, THAI's employees, and new investors. Furthermore, such timeframe was always discussed with the creditors' committee which Bangkok Bank, the 4th Objector, is also one of the creditors' committee. Additionally, under the law, each creditor in the same class must be treated equally. The Plan Administrator also confirmed that the resolution on conversion of the existing debt of every class and creditors at the same time, so that the repayment made to the same class is done equally. The proposal to amend this part, therefore, have the complete detail, procedure, and condition. Neither part is considered as a discrimination. Besides, the creditors who are in the same group with the Bangkok Bank, which are the main financial institution in Thailand, did not object to this amended part. Moreover, 78.59% of the creditors who attended the meeting and casted their vote accepted the proposal for the Plan amendment. This shows that the majority of creditors, including the creditors who receive the debt repayment by debt-to-equity conversion, accepted and support such amendment. It is deemed that such amendment will assist the debtor to have better financial statement, and that the creditors will receive the debt repayment faster. The debt-to-equity conversion is, therefore, not contrary to the Bankruptcy Act. (2) The Plan amendment in part of adding conditions to debt repayment of the Ticket Refund Creditors, i.e., repay the ticket value that was recorded and the repayment can be made from the date that the Court approve the amendment of Plan and such repayment shall be complete by March 31, 2024, may result in the difference of repayment amount from the final debt repayment order of the Official Receiver or Court. The amendment of debt repayment mean is not a deduction of debt amount. It is a debt repayment according to the actual ticket price that the debtors receive and the right and obligation of relevant parties in normal business and ticket agent. Moreover, the passenger may receive the debt repayment faster, without a necessity to wait for the final debt repayment order. Besides, there were no creditors objecting this proposal for Plan amendment. (3) The Plan amendment on debt repayment to the creditors having the dispute with the Company in the foreign court and it is necessary for the Plan Administrator to negotiate and to settle the disputes with such creditor. If debtor does not repay the debt to such creditors, the debtor's assets located abroad may be seized, including an aircraft while it is landed. This may be hurdle to business operation that may cause damage to revenue and reputation, including financial status and capacity to make a debt repayment to the creditor according to the Plan. Furthermore, it does not appear that the Objectors receive any effect from such amendment. The Objectors do not propose other better alternative or a solution which allow the Plan Administrator to operate flight business in the country where the disputes arisen without any difficulties and hurdles provided that the amendment on this part would not be made. Thus, the Plan amendment on this part is essential. (4) The Plan amendment on debt repayment to the creditor that is highly important to THAI's business operation. The creditor who is the provider of the airport services, ground handling services, and other services that important to business operation as specified in the name list together with details of the outstanding debt amount, shall be considered as the creditors that highly important to THAI's normal business operation. If the Plan was not amended, the debtor would not be able to continue to operate its normal business. It is not deemed that the creditors who submitted the debt repayment are affected. Moreover, such amendment is for the benefit of generating revenues in order to repay the creditors. It is, therefore, necessary and not considered as contrary to the Bankruptcy Act. Nevertheless, a condition that allows the debtor to propose additional creditors, outstanding amount, and necessity for making the repayment to the creditors' committee results in that the creditors' meeting and the court could not reviewed such details. Therefore, such condition shall be removed. However, such removal is not a significant part of the Plan. The remaining parts of the Plan are still effective. (5) The Plan amendment on the business transformation plan, the new-facility commission and condition to minimize the risk of creditor who is forced to convert debt to equity, including the condition for the Plan completion are not the condition under the law. Removal of a new-facility committee will reduce the procedure. Since the creditor committee who will monitor the Plan Administrator. Therefore, the Plan amendment is considered lawful. Regarding business transformation plan, the Plan Administrator's power is to manage the debtor's assets in accordance with the Plan including the business plan. The conditions (i) to minimize the risk of the creditor who is forced to convert debt to equity and (ii) to have sufficient financial facility as the condition for Plan completion concerned by the Bangkok Bank, the 4th Objector would bind the Plan Administrator to seek for high amount of facility in order to repay the debt by debt-to-equity conversion and exit the business reorganization. However, it is not easy to seek for high amount of facility while the debtor's business is insolvent. Besides, it depends on the terms or negotiation of the organization or financial institution that may provide the financial support, which is an external factor and uncontrollable. Such condition is, therefore, a burden to the debtor, i.e., the debtor is obliged to repay huge amount of debt in the future. The Plan only needs to clearly mention about the new facility, but it is not necessary to specific as the condition for Plan completion. The proposal for Plan amendment therefore has complete requirement pursuant to the law. The Plan Administrator, executives, and every employee are confident that the business reorganization under the Plan that the Court approved will be implemented smoothly until completion for the utmost benefit of all creditors. "We ensure to creditors, customer, and THAI's business partner that THAI will resume its business operation and service as the flag carrier and the pride of Thailand and Thai people, and will generate profits and continue to grow sustainably in the near future," the Company said. About Thai Airways Thai Airways International PCL (BAK:THAI) -- http://www.thaiairways.co.th/-- is the national carrier of Thailand. The company provides air transportation, freight and mail services on domestic and international routes including Asia, Europe, North America, Africa and South West Pacific. The Company is a state enterprise which is controlled by the government and partly owned by the public. As reported in Troubled Company Reporter-Asia Pacific on May 21, 2020, Thailand's cabinet approved a plan to restructure troubled Thai Airways International Pcl's finances through a bankruptcy court, the Southeast Asian country's prime minister said on May 19, 2020. The plan for a court-led restructuring of the national carrier replaces a previous proposal of a government-backed rescue package that was heavily criticised in the country. Thai Airways on May 27, 2020 said it appointed board members as rehabilitation planners in a bankruptcy court submission. On Sept. 14, 2020, Thailand's Central Bankruptcy Court approved Thai Airways debt restructuring. Thai Airways posted losses every year after 2012, except in 2016. In 2019, it reported losses of THB12.04 billion. The company's shareholders' equity turned negative at minus THB18.1 billion ($580 million) as of June. While its total liabilities ballooned to THB332.1 billion, a 36.7% increase from the end of 2019, its cash and cash equivalents fell by 35.5% to THB13.9 billion, according to the Nikkei Asia. =============== X X X X X X X X =============== MALDIVES: Fitch Alters Outlook on 'B-' Foreign Currency IDR to Neg. ------------------------------------------------------------------- Fitch Ratings has revised the Maldives' Outlook to Negative from Stable, while affirming its Long-Term Foreign-Currency Issuer Default Rating (IDR) at 'B-'. KEY RATING DRIVERS Outlook Revised to Negative: The Outlook revision reflects its assessment that tightening global financial conditions are intensifying the Maldives' external liquidity strains, even though tourism has made a remarkable recovery to pre-pandemic levels. A sharp decline in foreign-exchange buffers, if sustained, could complicate the government's external debt-servicing and maintenance of the currency peg to the US dollar. The ratings also balance the Maldives' strong GDP growth and some favourable structural indicators, such as per capita GDP, relative to 'B' peers, against a high government debt burden, and its vulnerability to shocks that could undermine prospects for tourism. Heightened External Vulnerabilities: Gross foreign reserves fell to USD540 million in September 2022 from a peak of USD1,017 million a year ago. This largely reflects a rising import bill on food and energy prices, the Maldives Monetary Authority's continued intervention to support the currency peg, and the repayment of a swap arrangement with the Reserve Bank of India (RBI). Fitch expects the current account deficit to remain high at 19.7% of GDP in 2022 on high import costs, while pressure in the parallel foreign-exchange market will likely persist in the near term. Fitch expects reserve buffers to remain low in coming quarters, with USD214 million in sovereign external debt-servicing obligations and USD151 million in publicly guaranteed external debt-servicing obligations due in 2023. Fitch believes the government will still rely on bilateral and multilateral financing sources, which partially mitigate the risks from tighter external financing conditions. Part of its US dollar revenue is kept in a sovereign development fund, with a liquid balance of USD103 million at end-3Q22, but foreign-currency assets were only USD32.8 million. Large Deficit: Fitch forecasts the fiscal deficit to widen to 15.7% of GDP in 2022 (2021E: 13.8%). This mainly reflects higher spending on infrastructure projects and larger-than-budgeted fuel subsidy costs (2% of GDP), offsetting stronger tourism revenue collection. Fitch projects the fiscal deficit to narrow to 11.8% in 2023 on an increase in the general and tourism goods and service tax and measured unwinding of subsidy support. Fitch expects high capex and recurrent spending for the public-sector pay harmonisation policy and the presidential election. High Public Debt Ratio: Fitch projects general government debt will rise to 101.8% of GDP in 2022 (2021E: 96.2%), above the projected 'B' median of 57.6%. Fitch envisages the ratio to remain elevated due to continued debt-funded infrastructure spending. Its baseline expects the ratio to gradually rise over the medium term, as Fitch assumes slower fiscal consolidation than the government's plan, with sizable primary deficits amid an economic slowdown. Guaranteed debt fell to 16.1% of GDP by end-1Q22 (2020: 34.7%) after the repayment of the RBI swap facility. Strong Tourism Recovery: The Maldives has been leading the tourism recovery across APAC. Fitch forecasts the economy will grow by 9.5% in 2022 after the upwardly revised 41.7% expansion in 2021. Its baseline expects annual tourist inflows to return to the pre-pandemic level this year on strong arrivals from India, Europe and the Middle East. However, Fitch thinks key risks to sustained growth could emerge from slowing global growth, and elevated inflation and energy prices, while a faster-than-expected easing of Chinese travel restrictions forms an upside risk. Medium-Term Growth Prospects: Fitch expects economic growth will remain robust and average above 7.5% during 2023-2024. Continued tourism infrastructure development, such as the recent launch of a new runway at the main Velana International Airport, a new passenger terminal scheduled to become operational by end-2024, and resort hotels under construction, should significantly boost the Maldives' capacity to accommodate inbound travellers over time. Low Banking-Sector Risks: The banking system remains well-capitalised with higher profitability on the revival of economic activity. The reported Tier 1 capital/risk-weighted asset ratio rose to 42.2% by end-2Q22 from 36.2% at end-2021. A sizable proportion of the banking system is foreign-owned, which reduces the sovereign's exposure to banking sector-related risks. High dollarisation in the system constrains potential sovereign support, given low reserve buffers. Regulatory non-performing loans were 6.0% at end-2Q22, well below the peak of 20.9% in 2012. ESG - Governance: The Maldives has an ESG Relevance Score (RS) of '5[+]' and '5', respectively, for Political Stability and Rights and for the Rule of Law, Institutional and Regulatory Quality and Control of Corruption. Theses scores reflect the high weight that the World Bank Governance Indicators have in its proprietary Sovereign Rating Model. The Maldives has a medium World Bank Governance Indicator ranking at the 48th percentile, reflecting a recent peaceful political transition, a moderate level of rights for participation in the political process, moderate institutional capacity, established rule of law and a moderate level of corruption. RATING SENSITIVITIES Factors that could, individually or collectively, lead to negative rating action/downgrade: - External Finances: Heightened external liquidity pressures, as a result of a fall in foreign-currency reserves or increasing difficulties in refinancing external maturities. - Public Finances: A sustained rise in general government debt or government guarantees to state-owned enterprises, for example, due to a prolonged economic downturn or a rise in public investment spending. Factors that could, individually or collectively, lead to positive rating action/upgrade: - External Finances: Strengthening of external buffers through accumulation of foreign-currency reserves. - Public Finances: A reduction in the public-debt burden over the medium term to closer to peer levels, for instance, from fiscal consolidation or better growth prospects. SOVEREIGN RATING MODEL (SRM) AND QUALITATIVE OVERLAY (QO) Fitch's proprietary SRM assigns the Maldives a score equivalent to a rating of 'B-' on the Long-Term Foreign-Currency (LT FC) IDR scale. In accordance with its rating criteria, Fitch's sovereign rating committee decided not to adopt the score indicated by the SRM as the starting point for its analysis because the SRM output has migrated to 'B-', but in its view this is potentially a temporary deviation. Consequently, the committee decided to adopt 'CCC+' as the starting point for its analysis. Fitch's sovereign rating committee adjusted the output from the adopted SRM score to arrive at the final LT FC IDR by applying its QO, relative to SRM data and output, as follows: - Structural: +2 notches, to adjust for the negative impact of the SRM of the Maldives' take-up of the Debt Service Suspension Initiative (DSSI), which prompted a reset of the "years since default or restructuring event" variable. In this case, Fitch judge that the Maldives' participation in the DSSI, unlike some other forms of restructuring, does not signal reduced capacity and willingness to meet obligations to private-sector creditors beyond other factors incorporated in the rating. - Public Finances: -1 notch, to reflect the risk of large government guarantees crystallising on the sovereign balance sheet, and the presence of non-linear risks from high public debt not fully captured in the SRM. Fitch's SRM is the agency's proprietary multiple regression rating model that employs 18 variables based on three-year centred averages, including one year of forecasts, to produce a score equivalent to a LT FC IDR. Fitch's QO is a forward-looking qualitative framework designed to allow for adjustment to the SRM output to assign the final rating, reflecting factors within our criteria that are not fully quantifiable and/or not fully reflected in the SRM. ESG CONSIDERATIONS The Maldives has an ESG Relevance Score of '5[+]' for Political Stability and Rights as World Bank Governance Indicators have the highest weight in Fitch's SRM and are therefore highly relevant to the rating and a key rating driver with a high weight. As the Maldives has a percentile rank above 50 for the respective Governance Indicator, this has a positive impact on the credit profile. The Maldives has an ESG Relevance Score of '5' for Rule of Law, Institutional & Regulatory Quality and Control of Corruption as World Bank Governance Indicators have the highest weight in Fitch's SRM and are therefore highly relevant to the rating and are a key rating driver with a high weight. As the Maldives has a percentile rank below 50 for the respective Governance Indicator, this has a negative impact on the credit profile. The Maldives has an ESG Relevance Score of '4' for Human Rights and Political Freedoms as the Voice and Accountability pillar of the World Bank Governance Indicators is relevant to the rating and a rating driver. As the Maldives has a percentile rank below 50 for the respective Governance Indicator, this has a negative impact on the credit profile. The Maldives has an ESG Relevance Score of '4' for Creditor Rights as willingness to service and repay debt is relevant to the rating and is a rating driver for the Maldives, as for all sovereigns. Except for the matters discussed above, the highest level of ESG credit relevance, if present, is a score of '3'. This means ESG issues are credit-neutral or have only a minimal credit impact on the entity, either due to their nature or to the way in which they are being managed by the entity. Entity Rating Prior ------ ------ ----- Maldives LT IDR B- Affirmed B- ST IDR B Affirmed B LC LT IDR B- Affirmed B- LC ST IDR B Affirmed B Country Ceiling B Affirmed B senior unsecured LT B- Affirmed B- USD 100 mln 5.5% bond/note 26-Apr -2023 LT B- Affirmed B- ********* S U B S C R I P T I O N I N F O R M A T I O N Troubled Company Reporter-Asia Pacific is a daily newsletter co- published by Bankruptcy Creditors' Service, Inc., Fairless Hills, Pennsylvania, USA, and Beard Group, Inc., Washington, D.C., USA. Marites O. Claro, Joy A. Agravante, Rousel Elaine T. Fernandez, Julie Anne L. Toledo, Ivy B. Magdadaro and Peter A. Chapman, Editors. Copyright 2022. All rights reserved. ISSN: 1520-9482. This material is copyrighted and any commercial use, resale or publication in any form (including e-mail forwarding, electronic re-mailing and photocopying) is strictly prohibited without prior written permission of the publishers. Information contained herein is obtained from sources believed to be reliable, but is not guaranteed. TCR-AP subscription rate is US$775 for 6 months delivered via e- mail. Additional e-mail subscriptions for members of the same firm for the term of the initial subscription or balance thereof are US$25 each. For subscription information, contact Peter Chapman at 215-945-7000. *** End of Transmission ***