/raid1/www/Hosts/bankrupt/TCRAP

/raid1/www/Hosts/bankrupt/TCRAP_Public/230320.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, March 20, 2023, Vol. 26, No. 57 Headlines A U S T R A L I A AMPLIFY FINCO: Moody's Affirms 'B2' CFR & Alters Outlook to Stable CAROLYN PTY: First Creditors' Meeting Set for March 23 COWCH GROUP: Placed Into Voluntary Administration DIDASKO PEOPLE: First Creditors' Meeting Set for March 24 FP TURBO 2023-1: Moody's Assigns B2 Rating to AUD5.95MM F Notes METRO FINANCE 2023-1: Moody's Assigns (P)B2 Rating to Cl. F Notes METRO HOMES: Second Creditors' Meeting Set for March 22 MJ'S ENTERPRISE: First Creditors' Meeting Set for March 23 PBS BUILDING: Debts Grow From AUD25 Million to AUD40 Million S & D HARDING: Second Creditors' Meeting Set for March 22 SHIFT TRUST 2023-1: Moody's Assigns B2 Rating to Class F Notes C H I N A CHINA HUARONG: Deloitte China Unit Hit with US$31MM Fine CHINA HUARONG: Moody's Withdraws (P)Ba1 Unsec. MTN Program Rating OCEANWIDE HOLDINGS: Guolian Wins Auction for Minsheng Securities TD HOLDINGS: Swings to $4.5 Million Net Income in 2022 H O N G K O N G SILICON VALLEY BANK: Noah Says Exposure Immaterial to Operations THEVELIA HOLDINGS: Fitch Puts B Foreign Currency IDR on Watch Pos. THEVELIA HOLDINGS: S&P Places 'B' LT ICR on CreditWatch Positive I N D I A ABHIMAANI PRAKASHANA: CRISIL Keeps C Ratings in Not Cooperating AL NAFEES: CRISIL Keeps D Debt Ratings in Not Cooperating ARIHANT INDUSTRIAL: CARE Reaffirms B+ Rating on INR12.76cr Loan ELA EDUCATIONAL: CRISIL Lowers Rating on INR8.85cr LT Loan to D ETA ENGINEERING: CRISIL Keeps D Debt Ratings in Not Cooperating FAMOUS STATIONERY: CRISIL Keeps D Debt Ratings in Not Cooperating FIREFLY BATTERIES: CRISIL Keeps D Debt Ratings in Not Cooperating FOREMOST INTERNATIONAL: CRISIL Keeps D Ratings in Not Cooperating G.R.S. ISPAT: CRISIL Keeps D Debt Ratings in Not Cooperating GANESH DIAGNOSTIC: CRISIL Keeps D Debt Ratings in Not Cooperating GHODAWAT REALTY: Ind-Ra Places BB+ Long Term Issuer Rating on Watch HAZARIBAGH RANCHI: Ind-Ra Affirms 'D' NonConvertible Debt Rating HEBBAL PROPERTIES: Ind-Ra Withdraws B NonConvertible Debt Rating HINDUSTAN CLEANENERGY: Ind-Ra Keeps D Rating in Non-Cooperating HOTEL SWOSTI: Ind-Ra Hikes LongTerm Issuer Rating to BB+ KERALA TRANSPORT: CRISIL Keeps D Debt Ratings in Not Cooperating KEW INDUSTRIES: CRISIL Keeps D Debt Ratings in Not Cooperating KUTTANAD RUBBER: CRISIL Keeps D Debt Ratings in Not Cooperating LAGGAR INDUSTRIES: CRISIL Keeps D Debt Rating in Not Cooperating LAXMI ENGINEERING: CRISIL Keeps D Debt Ratings in Not Cooperating LEOLINE FOODS: CRISIL Keeps D Debt Ratings in Not Cooperating LORD BALAJI: CRISIL Keeps D Debt Rating in Not Cooperating LOTUS PROJECTS: CRISIL Keeps D Debt Ratings in Not Cooperating LUNI POWER: CRISIL Keeps D Debt Rating in Not Cooperating M.R. OVERSEAS: CRISIL Keeps D Debt Rating in Not Cooperating MEALITE FOODS: CRISIL Keeps D Debt Ratings in Not Cooperating MEENAKSHI ASSOCIATES: CRISIL Keeps D Ratings in Not Cooperating MONEY2ME FINANCE: Ind-Ra Assigns BB+ Loan Rating, Outlook Stable MOUNT ZION: CRISIL Keeps D Debt Ratings in Not Cooperating N.S.K. BUILDERS: CRISIL Keeps D Debt Ratings in Not Cooperating OYSTER EXIM: Ind-Ra Hikes Long-Term Issuer Rating to BB+ RAJESHWARI COTSPIN: CRISIL Withdraws D Rating on INR19cr Loan SARVALOKA TEXTILES: Ind-Ra Affirms BB Long Term Issuer Rating SCAN ENERGY: CRISIL Withdraws D Rating on INR45.83cr Loan SOLVENT EXTRACTION: Ind-Ra Gives BB- Issuer Rating, Outlook Stable SUPER INFRATECH: CRISIL Keeps D Debt Ratings in Not Cooperating SURBHI SATCOM: Ind-Ra Cuts Long Term Issuer Rating to BB- VIKRANT FORGE: Ind-Ra Hikes Long Term Issuer Rating to B+ N E W Z E A L A N D ANNECY HOLDING: Court to Hear Wind-Up Petition on April 21 BAYSIDE DESIGNER: Goes Into Liquidation COLD RIVER: Creditors' Proofs of Debt Due on April 13 MCLACHLAN DECORATORS: Creditors' Proofs of Debt Due on April 13 RITZ ENTERPRISES: Court to Hear Wind-Up Petition on May 5 SWEETY TRADING: Creditors' Proofs of Debt Due on April 15 S I N G A P O R E CARTE BLANCHE: Court to Hear Wind-Up Petition on March 31 GSK GLOBAL: First Creditors' Meeting Set for April 3 JUNTOSTARC PTE: EA Consulting Appointed as Provisional Liquidators PEAK INVESTMENTS: Creditors' Proofs of Debt Due on April 17 TIGER ROAD: First Creditors' Meeting Set for April 3 - - - - - ================= A U S T R A L I A ================= AMPLIFY FINCO: Moody's Affirms 'B2' CFR & Alters Outlook to Stable ------------------------------------------------------------------ Moody's Investors Service has affirmed Amplify Finco Pty Limited's (TEG) B2 corporate family rating. At the same time, Moody's has affirmed TEG's B2 senior secured first lien term loan facility, and B3 senior secured rating on the second lien term loan facility. Moody's has also revised the outlook to stable from negative. RATINGS RATIONALE The rating affirmation and change in outlook to stable reflects the strong recovery in TEG's financial performance over recent quarters, following periods of covid-related disruption for the live events sector since the outbreak of the pandemic. TEG's reported EBITDA in recent quarters has recovered and surpassed pre-covid levels, reflecting solid demand, as well as the company's investments, acquisitions and ticketing contract wins in recent years, which have raised the earnings base of the company. Moody's expects this improvement in TEG's operating profile should lead to adjusted gross debt/EBITDA registering around 4x or lower over the next 12-18 months under its base scenario, notwithstanding the potential for some slowing of consumer discretionary spending due to inflation and higher interest rates. As a result of the recovery in TEG's financial performance and return to positive free cash flow, TEG's liquidity has also improved. As of the end of December 2022, the company held AUD76 million of unrestricted cash and had access to an AUD55 million undrawn revolving credit facility. Moody's considers such liquidity sources to be more than sufficient to meet the company's obligations over the next 12-18 months. TEG's rating benefits from its position as the leading integrated live entertainment company in Australia and New Zealand, operating across ticketing, live entertainment, data analytics and digital marketing. Its market position in its key ticketing business is supported by exclusive ticketing service agreements with the largest venues in Australia, its solid ticketing capability, as well as event pipeline generation through its live entertainment promotion business. The rating is constrained by the TEG's exposure to changes in consumer discretionary spending as a result of inflation and higher interest rates. The rating also considers the company's private equity ownership, which results in prioritization of shareholder interests over creditor interests, such as more aggressive growth plans and strategies, including a tolerance for higher debt and leverage. The stable outlook reflects Moody's expectation that TEG will sustain its improved financial performance, with the company maintaining a liquidity buffer and credit metrics comfortably within the parameters set for the rating. Environmental, Social and Governance (ESG) Considerations TEG's ESG Credit Impact Score is Highly Negative (CIS-4). ESG attributes have some negative impact on the rating currently due to governance risk considerations. TEG has neutral-to-low exposure to environmental risks (E-2), in line with exposure in the live entertainment industry. TEG has neutral-to-low exposure to social risks (S-2). However, data security risk exists as TEG collects a large amount of personal data through ticketing transactions. Given the sensitive nature of some of the data collected, such as credit card details and personal information, any data breaches can have legal, regulatory or reputational consequences. Moody's note that TEG has taken a number of steps to protect the personal information it collects, and has a good security track record. TEG has highly negative (G-4) exposure to governance risks. This reflects TEG's private equity ownership, which can result in prioritization of shareholder interests over creditor interests, such as more aggressive growth plans and strategies, including a tolerance for higher debt and leverage. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS Moody's could upgrade the ratings if (1) TEG's sustains its recent strong performance and maintains a solid liquidity buffer, with adjusted debt/EBITDA sustained below 4x and is expected to remain at this level or continue improving; and (2) there is further clarity around the company's financial policy and growth strategy. Moody's could downgrade the ratings if (1) TEG's adjusted debt/EBITDA approaches 6x; (2) the company experiences a significant deterioration in its market share; or (3) the company's liquidity profile weakens. Methodology The principal methodology used in these ratings was Business and Consumer Services published in November 2021. Profile Headquartered in Sydney, Australia, Amplify Finco Pty Limited's operating subsidiary, TEG Pty Limited, is an integrated live entertainment company. TEG operates ticketing services, promotes live sports and entertainment, and provides data analytics and digital marketing. The company was acquired by Silver Lake Partners in November 2019. CAROLYN PTY: First Creditors' Meeting Set for March 23 ------------------------------------------------------ A first meeting of the creditors in the proceedings of Carolyn Pty Ltd will be held on March 23, 2023, at 10:00 a.m. at 6/239 George Street in Brisbane. Daniel Moore of BCR Advisory was appointed as administrator of the company on March 13, 2023. COWCH GROUP: Placed Into Voluntary Administration ------------------------------------------------- The Cowch Group of entities, on March 14, 2023, were placed into Voluntary Administration with SV Partners Administrators Terry van der Velde and Terry Rose leading the appointment. Established in Brisbane in 2014, Cowch has grown into a popular hospitality and manufacturing business consisting of four dessert cocktail bars located in Chermside, South Bank, Broadbeach and Garden City, and its own commercial production facility in Morningside, Queensland. Unfortunately, like many other businesses, Cowch has not been unaffected by conditions beyond its control including (though not limited to) the COVID-19 pandemic, floods and continued economic challenges. Cowch is a well-known and loved brand in the Brisbane community and the Administrators are committed to exploring all options to ensure its future success. The Administrators will be working closely with management, staff, creditors, and other stakeholders to provide a positive outcome for all parties involved. SV Partners are optimistic that customers will continue to support the local family business as it continues to trade through the Administration, while the Administrators work to secure investors to ensure the future of Cowch is secured. The Administrators have commenced an immediate assessment of the business operations and financial position and will be liaising with all stakeholders in the coming days and weeks to explore all available options. All media enquiries can be directed to media@svp.com.au, while investor enquiries can be directed to matthew.hudson@svp.com.au. An initial meeting of creditors will take place virtually on March 24, according to SmartCompany. DIDASKO PEOPLE: First Creditors' Meeting Set for March 24 --------------------------------------------------------- A first meeting of the creditors in the proceedings of Didasko People Solutions Pty Ltd will be held on March 24, 2023, at 11:00 a.m. at the offices of Romanis Cant, Level 2, 106 Hardware Street, Melbourne in Victoria. Manuel Hanna and Anthony Robert Cant of Romanis Cant were appointed as administrators of the company on March 14, 2023. FP TURBO 2023-1: Moody's Assigns B2 Rating to AUD5.95MM F Notes --------------------------------------------------------------- Moody's Investors Service has assigned the following definitive ratings to the notes issued by Perpetual Corporate Trust Limited in its capacity as trustee of FP Turbo Series 2023-1 Trust. Issuer: Perpetual Corporate Trust Limited in its capacity as trustee of FP Turbo Series 2023-1 Trust AUD277.90 million Class A Notes, Assigned Aaa (sf); AUD17.85 million Class B Notes, Assigned Aa2 (sf); AUD12.60 million Class C Notes, Assigned A2 (sf); AUD5.60 million Class D Notes, Assigned Baa2 (sf); AUD12.60 million Class E Notes, Assigned Ba2 (sf); AUD5.95 million Class F Notes, Assigned B2 (sf). The AUD17.50 million Seller Notes are not rated by Moody's. The transaction is a securitisation of operating, novated and finance leases extended to Australian government and statutory corporations, corporates, small and medium-sized businesses and their employees. The leases securitised in this portfolio are secured by passenger cars, commercial vehicles and auto equipment. The collateral pool composition is static and no pre-funding or substitution of receivables will take place during the life of the transaction. All receivables were originated by Fleet Partners Pty Limited (FleetPartners, unrated), FleetPlus Pty Limited and Fleet Choice Pty Limited (both wholly owned subsidiaries of FleetPartners). The securitised portfolio comprises lease instalment cash flows and residual value cash flows. The present value of the outstanding lease receivables balance is approximately AUD350.0 million and the nominal value of estimated operating lease residual value (RV) cash flows amounts to around AUD106.7 million. Due to the right of the lessees to return the vehicle at contract maturity in order to cover the final lease balance outstanding under an operating lease, the notes are exposed to both default and market or residual value risk of the related vehicles. RATINGS RATIONALE The definitive ratings take into account, among other factors: -- An evaluation of the capital structure, underlying portfolio of leases obligors and underlying RV exposure; -- Back-up maintenance and servicer solutions; -- The liquidity support available in the transaction in the form of the liquidity facility; -- The experience of FleetPartners as servicer and the back-up servicing arrangements with Perpetual Corporate Trust Limited. The transaction benefits from credit strengths such as experience of the originator, diversification of vehicle manufacturer and lease term dates and strong historical performance of the lease portfolio. However, Moody's notes that the transaction features some credit weaknesses such as high lessee concentration and residual value risk. KEY TRANSACTION FEATURES The notes will be repaid on a sequential basis in the initial stages, until the subordination percentage increases from the initial 20.6% to 35.0% for the Class A Notes and no unreimbursed charge offs, at which point Class A to Class F Notes will be repaid on a pro-rata basis (but senior to the Seller Notes). The liquidity facility sized at 1.5% of the outstanding amount of all notes (with a hard floor of AUD250,000) is available where trust income and principal collections are insufficient to meet interest payment shortfalls on the required payments. KEY POOL FEATURES -- The majority of receivables (84.7%) are secured by passenger vehicles or light commercial vehicles ( METRO FINANCE 2023-1: Moody's Assigns (P)B2 Rating to Cl. F Notes ----------------------------------------------------------------- Moody's Investors Service has assigned provisional ratings to notes to be issued by Perpetual Corporate Trust Limited as trustee of Metro Finance 2023-1 Trust. Issuer: Metro Finance 2023-1 Trust AUD429.5 million Class A Notes, Assigned (P)Aaa (sf) AUD27.0 million Class B Notes, Assigned (P)Aa2 (sf) AUD13.5 million Class C Notes, Assigned (P)A2 (sf) AUD7.0 million Class D Notes, Assigned (P)Baa2 (sf) AUD11.5 million Class E Notes, Assigned (P)Ba2 (sf) AUD2.5 million Class F Notes, Assigned (P)B2 (sf) The AUD4.0 million Class G1 Notes and AUD5.0 million Class G2 Notes are not rated by Moody's. The transaction is a cash securitisation of a portfolio of Australian prime commercial auto and equipment loans and leases and novated leases secured by motor vehicles originated by Metro Finance Pty Limited (Metro Finance, unrated). This is Metro Finance's first auto and equipment asset backed securities (ABS) transaction for 2023. Metro Finance was established in 2011 as a commercial auto/equipment lender. It targets prime borrowers, for small-ticket auto and equipment assets in low volatility industries. Metro Finance originates its lending through the commercial auto and equipment broker and aggregator industry nationally. Significant origination growth began in 2014. RATINGS RATIONALE The provisional ratings take into account, among other factors: The historical loss data. The static loss data used for Moody's extrapolation analysis, which reflects Metro Finance's origination history, was limited to the origination vintages between Q4 2014 and Q3 2021; The evaluation of the underlying receivables and their expected performance; The fact that 74.1% of the receivables were extended to prime commercial obligors on a no-income verification basis, referred to as "streamlined". This streamlined product allows obligors who meet certain stringent requirements to access the loan without providing financial statements. See below for further information on Metro Finance's streamlined product; The 46.1% exposure to loans with a balloon payment at the end of the receivable term. The aggregate balloon exposure as a percentage of current portfolio balance is 15.6%. Loans with a balloon payment are subject to higher refinancing and, consequently, default risk; The evaluation of the capital structure; The availability of excess spread over the life of the transaction; The liquidity facility in the amount of 2.00% of the invested amount of the rated notes subject to a floor of AUD982,000; The interest rate swap provided by National Australia Bank Limited (Aa3/P-1/Aa2(cr)/P-1(cr)). The notional amount under the swap agreement may exceed or fall below the outstanding balance of the rated notes in the event that prepayments deviate from the assumed prepayment rate. Such deviations will expose the transaction to being under-hedged or over-hedged. Over-hedging risk is mitigated by the fact that break costs are charged to the obligors and these funds will flow through to the trust as collections. Further, Metro Finance has the ability to adjust the notional schedule over the life of the transaction to better match the paydown over time. According to Moody's, the transaction benefits from various credit strengths such as relatively high subordination to the senior notes, the prime nature of the underlying borrower and the highly diversified nature of the portfolio. However, Moody's notes that the transaction features some credit weaknesses such as the substantial portion of the portfolio extended on a streamlined basis and the pro-rata amortisation of rated notes under certain conditions. Initially, the Class A, Class B, Class C, Class D, Class E, Class F and Class G1 Notes benefit from 14.1%, 8.7%, 6.0%, 4.6%, 2.3%, 1.8% and 1.0% of note subordination, respectively. The notes will initially be repaid on a sequential basis until the credit enhancement to Class A Notes is greater than or equal to 20.0%. The notes will also be repaid on a sequential basis if there are any unreimbursed charge-offs on the notes or if the first call option date has occurred. At all other times, the structure will follow a pro-rata repayment profile (assuming pro-rata conditions are satisfied). MAIN MODEL ASSUMPTIONS Moody's base case assumptions are a default rate of 2.25%, a recovery rate of 35.00% and a portfolio credit enhancement of 15.00%. Moody's assumed default rate and recovery rate are stressed compared to the historical levels of 1.13% (extrapolated mean default of 1.21%) and 61.88% respectively. The difference between the historical and assumed default rate and recovery rate is in part explained by the additional stresses assumed by Moody's to address the lack of a full economic cycle in the historical data and the exposure to balloon loans in the portfolio. Moody's have also benchmarked the historical data for Metro Finance to data from comparable Australian commercial auto and equipment ABS originators. Moody's have also overlaid additional stresses into Moody's default and PCE assumptions. Methodology Underlying the Rating Action The principal methodology used in these ratings was "Moody's Global Approach to Rating Auto Loan- and Lease-Backed ABS" published in November 2022. Factors that would lead to an upgrade or downgrade of the ratings: Factors that could lead to an upgrade of the notes include a rapid build-up of credit enhancement due to sequential amortization or better-than-expected collateral performance. The Australian job market is a primary driver of performance. A factor that could lead to a downgrade of the notes is worse-than-expected collateral performance. Other reasons that could lead to a downgrade include poor servicing, error on the part of transaction parties, a deterioration in the credit quality of transaction counterparties, or lack of transactional governance and fraud. METRO HOMES: Second Creditors' Meeting Set for March 22 ------------------------------------------------------- A second meeting of creditors in the proceedings of Oak Park Capital Pty Ltd and Stubley Family Office Pty Ltd has been set for March 22, 2023 at 11:00 a.m. at the offices of Hamilton Murphy Advisory at Level 21, 114 William Street in Melbourne and 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 March 21, 2023 at 4:00 p.m. Stephen Dixon of Hamilton Murphy Advisory was appointed as administrators of the company on Feb. 14, 2023. MJ'S ENTERPRISE: First Creditors' Meeting Set for March 23 ---------------------------------------------------------- A first meeting of the creditors in the proceedings of MJ's Enterprise Group Pty. Ltd. will be held on March 23, 2023, at 10:00 a.m. at 22 Market Street in Brisbane. Terrence John Rose and Adam Kersey of SV Partners were appointed as administrators of the company on March 13, 2023. PBS BUILDING: Debts Grow From AUD25 Million to AUD40 Million ------------------------------------------------------------ News.com.au reports that a building company that sensationally collapsed earlier this month after it shut down its website and abandoned its construction sites has millions more debt than was first expected. On March 7, PBS Building, a multimillion-dollar firm which does a mix of commercial and residential projects across Queensland, NSW and the ACT, went into voluntary administration. News.com.au relates that when administrators took over the firm, they said the construction company was expected to owe around AUD25 million to more than 1,000 creditors. But a deeper investigation has revealed a much larger bill to foot. At the first creditor's meeting held on March 17, the administrators revealed the debt has snowballed and stands at AUD40 million at last count, news.com.au discloses. This figure didn't include the 180 staff members who were terminated on the spot, but with entitlements that had been paid in full prior to the company's collapse. Jonathon Colbran, Richard Stone & Mitchell Herrett from insolvency firm RSM Australia Partners were appointed as joint administrators. "To date, 374 claims have been lodged by creditors - 177 in the ACT, 131 in NSW and 66 in Queensland," the report quotes Mr. Colbran as saying. "This number is also expected to rise and fall until the Administrators are able to verify the claims." News.com.au says the meeting on March 17 also revealed the staggering amount of projects underway that have been impacted by the firm's sudden closure. PBS Building had 24 projects at various stages of completion when it called in administrators. Of those, there are five projects in Queensland, eight projects in NSW and 11 in the Australian Capital Territory. But on top of that, another 56 projects are also at risk. Although these 56 projects have been completed, they are still in their defect liability period, news.com.au relates. That means if something were to go wrong, it could be tricky, as there is no designated builder to bear the brunt of the costs. The fate of PBS Building hangs in the balance. At the next meeting, creditors will decide if the company should be wound up in liquidation or stay in administration under a deed of company arrangement (DOCA) agreement, news.com.au notes. Jonathon Kingsley Colbran and Mitchell Herrett & Richard Stone of RSM Australia Partners were appointed as administrators of PBS Building on March 7, 2023. S & D HARDING: Second Creditors' Meeting Set for March 22 --------------------------------------------------------- A second meeting of creditors in the proceedings of S & D Harding Pty Ltd has been set for March 22, 2023 at 10:00 a.m. at Suite 38, 3 Box Road Caringbah and 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 March 21, 2023 at 5:00 p.m. Darren John Vardy of Insolvency Options was appointed as administrators of the company on Feb. 21, 2023. SHIFT TRUST 2023-1: Moody's Assigns B2 Rating to Class F Notes -------------------------------------------------------------- Moody's Investors Service has assigned definitive ratings to notes to be issued by BNY Trust Company of Australia Limited, as trustee of Shift 2023-1 Trust. Issuer: Shift 2023-1 Trust AUD128.40 million Class A Notes, Assigned Aaa (sf) AUD25.40 million Class B Notes, Assigned Aa2 (sf) AUD10.60 million Class C Notes, Assigned A2 (sf) AUD7.00 million Class D Notes, Assigned Baa2 (sf) AUD11.40 million Class E Notes, Assigned Ba2 (sf) AUD4.60 million Class F Notes, Assigned B2 (sf) The AUD12.60 million of Class G Notes are not rated by Moody's. The transaction is a securitisation of a portfolio of commercial equipment loans and leases originated by Shift Financial Pty Ltd ("Shift", formerly known as Get Capital Pty Ltd, and ACN 601 158 507 Pty Ltd, a subsidiary of Shift Financial Pty Ltd). Shift will act as servicer of the transaction. This is Shift's inaugural public ABS transaction. Shift is an Australian SME lender providing, unsecured term loans, working capital facilities, asset finance and trade payment solutions to Australian businesses since 2014. As of December 31, 2022 Shift has lent circa $2.1 billion. RATINGS RATIONALE The definitive ratings take into account, among other factors, Moody's evaluation of the underlying receivables and their expected performance, an evaluation of the capital structure and credit enhancement provided to the notes, the availability of excess spread over the life of the transaction, the liquidity facility in the amount of 1.5% of the rated notes' balance, the legal structure, the experience of Shift as servicer; and the presence of BNY Trust Company of Australia Limited as a standby servicer. According to Moody's, the transaction benefits from the high level of excess spread available to cover losses arising from the portfolio. The key challenge in the transaction is the limited historical data available for the portfolio. Shift is a relatively new originator, with historical default data for its equipment commercial loan book only available from 2016 and for its unsecured business loans and line-of-credit facilities from 2015. As such, the pool's performance could be subject to greater variability than the observed data indicates. The transaction's key features are as follows: Initially, the Class A, Class B, Class C, Class D, Class E and Class F Notes benefit from 35.80%, 23.10%, 17.80%, 14.30%, 8.60% and 6.30% of note subordination, respectively. Once stepdown conditions (Class A to F) are satisfied, all notes, excluding the Class G Notes, will receive their pro-rata share of principal. Step-down conditions include, among others, 45% subordination to the Class A Notes and no unreimbursed charge-offs. Once stepdown criteria (Class G) are satisfied, all notes, including the Class G Notes, will receive their pro-rata share of principal. Step-down criteria G include all stepdown criteria and a Class F subordination requirement of at least double the Class F Notes Subordination Percentage at close. A swap provided by National Australia Bank Limited (Aa3/P-1/Aa2(cr)/P-1(cr)) will hedge the interest rate mismatch between the assets bearing a fixed rate of interest, and floating rate liabilities. The notional balance of the swap will follow the schedule amortization of the portfolio. BNY Trust Company of Australia Limited (BNY) is the back-up servicer. If Shift is terminated as servicer, BNY will take over the servicing role in accordance with the standby servicing deed and its back-up servicing plan. BNY has delegated the standby servicer function to Verofi, a specialist third-party standby servicer, however BNY retains legal responsibility for the standby servicer's contractual obligations. Key portfolio features are as follows: The portfolio is highly diversified both at an obligor level and a geographical level. The largest obligor concentration is 1.0%. The portfolio has a high yield of 10.5% which provides excess spread to cure portfolio losses. Heavy commercial vehicle loans are the largest component making up 49.2% of the portfolio, intangible tertiary assets such as installations and fitouts are the second largest component making up 14.9% of the portfolio. Key model assumptions: Moody's assumptions are an expected portfolio loss rate of 6.50%, and a portfolio credit enhancement ("PCE") — representing the loss that Moody's expects the portfolio to suffer in the event of a severe recessionary scenario — of 38.00%. To address the limited historical loss data on Shift's portfolio, Moody's have benchmarked the historical performance to data from comparable Australian commercial auto and equipment ABS originators. Moody's have also overlaid additional stresses into Moody's default and PCE assumptions. Methodology Underlying the Rating Action The principal methodology used in these ratings was "Equipment Lease and Loan Securitizations Methodology" published in September 2022. Factors that would lead to an upgrade or downgrade of the ratings: Factors that could lead to an upgrade of the notes include a rapid build-up of credit enhancement, due to sequential amortization or better-than-expected collateral performance. The Australian job market is a primary driver of performance. A factor that could lead to a downgrade of the notes is worse-than-expected collateral performance. Other reasons that could lead to a downgrade include poor servicing, error on the part of transaction parties, a deterioration in the credit quality of transaction counterparties, or lack of transactional governance and fraud. ========= C H I N A ========= CHINA HUARONG: Deloitte China Unit Hit with US$31MM Fine -------------------------------------------------------- South China Morning Post reports that Deloitte Hua Yong, the "Big Four" accounting firm's China unit, has been fined CNY212 million (US$31 million) for failures in audit work conducted at bad loan manager China Huarong Asset Management, as Beijing strengthens financial regulation. The Deloitte unit failed to detect the true conditions of some of Huarong's underlying assets, or to fully assess its businesses and operations, from 2014 to 2019, China's ministry of finance said in a statement on its website on March 17, the Post relays. Deloitte's Beijing branch has been banned from conducting business for three months, and its "illegal income" has been "confiscated". "During the period when it offered auditing services [to Huarong], [Deloitte Hua Yong] did not maintain [a] professional sceptical attitude, did not effectively conduct essential auditing procedures, did not obtain sufficient and adequate auditing evidence and had severe auditing flaws," the ministry said in its statement. According to the Post, financial risk prevention has become increasingly important for Beijing, with authorities and regulators accelerating measures to regulate different segments of the country's financial industry. China has stepped up measures to clean up entities and individuals that have roiled its economic and financial stability in the past, such as Tomorrow Group's Xiao Jianhua and Huarong. The ministry finalised the penalties based on on-site inspections at both Deloitte and Huarong from February 24 to March 6 this year, the statement, as cited by the Post, said. The accounting firm ignored compliance checks on important investments, failed to offer auditing suggestions on abnormal transactions and failed to objectively assess the condition of Huarong's assets, the ministry added. The Post says the licences of two certified accountants at Deloitte were also suspended, with a few others ordered to pause accounting services for either a year or six months. Meanwhile, Hong Kong-listed Huarong was fined CNY100,000 as the ministry found that the company's internal risk controls were ineffective and accounting data was "severely distorted". Seven Huarong subsidiaries also faced the same amount of fines. In a statement on March 17, Deloitte said it respected and accepted the ministry's penalties, but did not directly admit or refute the government's specific accusations, the Post relays. "To be clear, there is no suggestion by the [ministry] that either Deloitte Hua Yong, its Beijing branch, or any of its people have done anything unethical," Deloitte said. "We respect and accept the [ministry's] penalty decision. We regret that, in this matter, the [ministry] considers certain aspects of our work fell below the required auditing standards." Huarong is among China's four big bad loan managers, along with Cinda, China Great Wall Asset Management and China Orient Asset Management. It was bailed out by the government in 2021 after its debt problems roiled the world's second-largest credit market the same year, the Post states. Huarong delayed its earnings report for 2020 before major problems came to light, including net losses of CNY102.9 billion in 2020. Citic Group, the state-owned investment giant, has become Huarong's largest shareholder after receiving a 3% stake from the ministry of finance, the Post discloses citing an exchange filing by Huarong on March 7 this year. China Huarong Asset Management Co Ltd is a China-based company mainly engaged in asset management business. The Company operates through three segments. The Distressed Asset Management Operations segment is engaged in distressed asset management, debt equity swap asset management, the management of non-performing assets carried out by subsidiaries distressed asset management business conducted by its subsidiaries, distressed asset-based special situations investments business and distressed asset-based property development business. The Financial Services segment mainly includes securities and futures business, financial leasing business, banking services business and consumer finance business. The Asset Management and Investment Operations segment is mainly engaged in trust business, private equity funds business, financial investments business, international business, and other businesses. CHINA HUARONG: Moody's Withdraws (P)Ba1 Unsec. MTN Program Rating ----------------------------------------------------------------- Moody's Investors Service has withdrawn China Huarong Financial Leasing Co., Ltd.'s (Huarong Financial Leasing) Baa3 long-term and P-3 short-term issuer ratings. Moody's has also withdrawn Huarong Leasing Management Hong Kong Co Ltd's long-term backed senior unsecured medium-term note (MTN) program ratings of (P)Baa3/(P)Ba1 and backed other short-term ratings of (P)P-3/(P)NP. At the time of the withdrawal, these ratings were under review with direction uncertain. RATINGS RATIONALE Moody's has decided to withdraw the ratings for its own business reasons. Huarong Financial Leasing, headquartered in Hangzhou, Zhejiang, was founded in 1986 under the name Zhejiang Financial Leasing Co., Ltd and acquired by China Huarong Asset Management Co., Ltd. (Huarong AMC, Baa2 negative) in 2006. It reported total assets of RMB110 billion as of June 30, 2022. On November 17, 2021, Huarong AMC announced that it planned to dispose its 79.92% shareholding in Huarong Financial Leasing. Huarong Leasing Management Hong Kong Co Ltd is an indirectly wholly-owned subsidiary of Huarong Financial Leasing and its primary overseas platform. OCEANWIDE HOLDINGS: Guolian Wins Auction for Minsheng Securities ---------------------------------------------------------------- South China Morning Post reports that Guolian Securities, an investment banking group listed in Hong Kong, has bought a 30.3% stake in Minsheng Securities for CNY9.1 billion (US$1.3 billion) through an online auction, after creditors seized the asset to recover debt owed by its distressed parent Oceanwide Holdings. According to the Post, the company outbid rivals including Soochow Securities and Zheshang Securities after a 162-round of bidding war for the block of shares. It was transacted on JD.com's auction platform, with a reserve price of about CNY5.9 billion. Creditors last month obtained approval from the Jinan Intermediate People's Court to sell the shares, according to a local media report on Sina.com. Shenzhen-based developer Oceanwide had CNY226.2 billion debt as of July 2021, accumulated from an aggressive expansion at home and abroad, only to fall into a debt trap as borrowing costs surged and financing dried up, the Post discloses. Like many peers, Oceanwide ran into liquidity problems not long after Beijing squeezed weak and overleveraged players – from China Evergrande to Guangzhou R&F Properties and Kaisa Group, to contain systemic risk in the local financial system. Led by chairman Ge Xiaobo, a seasoned investment banker and a former senior executive at Citic Securities, Guolian is expanding in an "oligarchic market" where the total profits of the top three companies accounted for 23 per cent of the entire industry, he said. The Post says China pushed a registration-based system for domestic fundraising to spur stock listings, thus creating new opportunities for growth. The firm, which offers brokerage, wealth management and bond underwriting, last month agreed to buy 49 per cent of Zhongrong Fund for CNY1.44 billion, pending a full takeover at a later date. About Oceanwide Holdings Oceanwide Holdings Co Ltd is a China-based company principally engaged in the development and distribution of real estates and the provision of financial services. The Company operates four business segments. The Real Estate Business segment is engaged in real estate development and construction, property leasing, real estate investment, decoration projects, real estate management and property services, and its products include residences, apartments, hotels, office buildings and large-scale complexes. The Financial Business segment is engaged in securities, investment, futures, insurance, trust and financial information service businesses. The Capital Investment Business segment is engaged in strategic investment business. The Energy Power Business is engaged in the construction and production of power projects. The Company mainly conducts its businesses in the China market. TD HOLDINGS: Swings to $4.5 Million Net Income in 2022 ------------------------------------------------------ TD Holdings, Inc. has filed with the Securities and Exchange Commission its Annual Report on Form 10-K disclosing net income attributable to the Company's stockholders of $4.52 million on $156.83 million of total revenues for the year ended Dec. 31, 2022, compared to a net loss attributable to the Company's stockholders of $940,357 on $201.13 million of total revenues for the year ended Dec. 31, 2021. As of Dec. 31, 2022, the Company had $363.10 million in total assets, $65.12 million in total liabilities, and $297.97 million in total shareholders' equity. A full-text copy of the Form 10-K is available for free at: https://bit.ly/3JxS054 About TD Holdings Headquartered in Shenzhen, Guangdong, PRC, TD Holdings, Inc. -- visit http://ir.tdglg.com--is a service provider currently engaging in commodity trading business and supply chain service business in China. Its commodities trading business primarily involves purchasing non-ferrous metal product from upstream metal and mineral suppliers and then selling to downstream customers. Its supply chain service business primarily has served as a one-stop commodity supply chain service and digital intelligence supply chain platform integrating upstream and downstream enterprises, warehouses, logistics, information, and futures trading. * * * This concludes the Troubled Company Reporter's coverage of TD Holdings until facts and circumstances, if any, emerge that demonstrate financial or operational strain or difficulty at a level sufficient to warrant renewed coverage. ================= H O N G K O N G ================= SILICON VALLEY BANK: Noah Says Exposure Immaterial to Operations ---------------------------------------------------------------- Noah Holdings Limited, a leading and pioneer wealth management service provider in China offering comprehensive one-stop advisory services on global investment and asset allocation primarily for high net worth investors, on March 12 informed its investors that it is aware of the closure of Silicon Valley Bank (the "SVB") and appointment of the Federal Deposit Insurance Corporation as receiver (collectively, the "SVB's Receivership"). Noah currently has cash and cash equivalents of less than US$1 million with the SVB, representing less than 0.2% of its total cash and cash equivalents, and therefore believes its exposure to any liquidity concern as a result of the SVB's Receivership is immaterial to its business operations or financial condition. In addition, Noah, under its asset management business, serves as the general partner or fund manager for certain investment funds with accounts at the SVB, and has taken necessary measures to protect against or minimize the potential impact of the SVB's Receivership on these funds. Noah will continue to monitor this situation and proactively fulfill its fiduciary duties to the limited partners and investors of the funds. About Noah Holdings Limited Noah Holdings Limited (NYSE: NOAH and HKEX:6686) is a leading and pioneer wealth management service provider in China offering comprehensive one-stop advisory services on global investment and asset allocation primarily for high net worth investors. Noah is a Cayman Islands holding company and carries on business in Hong Kong as Noah Holdings Private Wealth and Asset Management Limited. In the first nine months of 2022, Noah distributed RMB52.3 billion (US$7.3 billion) of investment products. Through Gopher Asset Management, Noah had assets under management of RMB156.2 billion (US$22.0 billion) as of September 30, 2022. Noah's wealth management business primarily distributes private equity, private secondary, mutual fund and other products denominated in RMB and other currencies. Noah's network covers 76 cities in mainland China, as well as offices in Hong Kong, Taiwan, New York, Silicon Valley and Singapore. A total of 1,257 relationship managers provide customized financial solutions for clients through this network, and meet their international investment needs. The Company's wealth management business had 433,250 registered clients as of September 30, 2022. Through Gopher Asset Management, Noah manages private equity, public securities, real estate, multi-strategy and other investments denominated in RMB and other currencies. The Company also provides other services. THEVELIA HOLDINGS: Fitch Puts B Foreign Currency IDR on Watch Pos. ------------------------------------------------------------------ Fitch Ratings has placed Thevelia Holdings Limited's Long-Term Foreign-Currency Issuer Default Rating (IDR) of 'B' on Rating Watch Positive (RWP). Fitch has also placed the 'B+' rating of Thevelia's USD760 million senior first-lien secured term-loan B (TLB) on RWP. The loan, which has a Recovery Rating of 'RR3', is issued by Thevelia (US) LLC, which is wholly owned by Thevelia. At the same time, Fitch has assigned expected ratings of 'BB-(EXP)', with Recovery Ratings of 'RR3', to the proposed US-dollar and euro tranches of the senior first-lien secured TLBs issued by Thevelia (US) and Thevelia Finance, S.a.r.l., respectively. Thevelia Finance is also wholly owned by Thevelia. The proceeds will be used to partially fund the acquisition of the corporate, trust and outsourcing services provider, Vistra Group Holdings, repay Vistra's existing debt and meet related transaction costs. BPEA EQT Asia, the private equity firm that owns Thevelia, entered an agreement in February 2023 to acquire Vistra and will do so via Thevelia. Vistra is also a portfolio company managed by BPEA EQT Asia. The deal is pending regulatory approval and is expected to close in 3Q23 in the base case, but may close more than six months from the date of this press release. The final TLB ratings are contingent on the successful completion of the acquisition, the issuance of the TLBs and the receipt of final documents conforming to information already received. The RWP reflects Fitch's expectation that Thevelia's post-transaction credit profile will be commensurate with a 'B+' rating, with an enhanced platform of service offerings, recurring revenue from a diverse customer base, high profitability and strong cash flow generation to support deleveraging. Fitch expects to align the post-merger leverage sensitivity thresholds to reflect the stronger business profile, with the forecast EBITDA uplift in 2024 reducing net leverage to below 6x. KEY RATING DRIVERS Enhanced Post-Acquisition Market Position: Fitch expects Thevelia to fortify its market position after its acquisition of Vistra, whose operation it intends to merge with Tricor Group, which Thevelia acquired in June 2022. This will create a market-leading platform with enlarged geographical and service coverage, expanding beyond Tricor's specialisation in Asia. The wider multi-jurisdictional platform of complementary service offerings should solidify Thevelia's one-stop shop value proposition amid the fragmented fund and corporate services market. Deleveraging Capacity: Immediate post-transaction leverage is likely to be high, but Fitch expects cost synergies to boost EBITDA and result in lower leverage. Pro forma 2023 EBITDA net leverage, assuming a full-year contribution from Vistra, may reach around 7.0x, but should fall toward 5.5x in 2024. Fitch believes this is appropriate for a 'B+' rating, considering the improved post-acquisition business profile. Fitch expects USD1.7 billion in proceeds from the proposed TLBs to be used to partially fund the Vistra acquisition and repay Vistra's existing TLB balance of USD1.0 billion. As such, Fitch estimates post-transaction debt of USD2.7 billion, with USD350 million in revolving credit facilities (RCFs) and a beginning balance of USD250 million in readily available cash. Cash-Generative Business Model: Fitch believes the asset-light nature of the post-merger entity's operation should allow for high cash conversion. Its forecast free cash flow (FCF) margin of 7%-16% for 2023-2025 is higher than that of many Fitch-rated business services peers. This should ensure Thevelia is well-capitalised, help buffer against any further interest rate rises, offer flexibility for debt repayment and fund smaller bolt-on acquisitions. However, this could be negated by significant changes in the capital structure, such as debt-funded M&A or shareholder distributions. High Profitability: Fitch believes the post-merger operation will achieve an EBITDA margin of 35%-40%. Each company's advantages, including global service centres and automation, can be mutually beneficial for the operating margin upon roll-out and reduction in overlapping functions. Slower implementation or higher integration costs could lead to a lower EBITDA than Fitch estimates, but Fitch thinks such risks are mitigated by Tricor and Vistra being managed by the same sponsor. Stronger Organic Growth: Fitch believes there is high visibility for organic growth following the merger. Fitch expects Tricor and Vistra's wider platform of complementary services and expanded customer base to create immediate cross-selling opportunities and expansion under the common sponsor. The current challenging economic environment could cause uncertainty in business activity, but Fitch expects the company should generate at least modest growth with its diversified service offerings and strong customer relationships. Resilient and Visible Revenue: Tricor and Vistra both benefit from defensive business models with resilient demand through economic cycles, supported by a consistent customer base and a high proportion of recurring services. The combined operation will serve over 50,000 customers with low attrition and will be spread across a range of industries, with over 90% of revenue being recurring or re-occurring. Stable Tricor Operation: Tricor's standalone business was stable in 2022, despite difficult market conditions. Reported revenue, which still rose by 6.4%, was negatively impacted by a slower Hong Kong IPO pipeline, but profitability was steady, with an EBITDA margin of 38.7% based on preliminary results. Fitch expects further improvement, given the short timeframe since its acquisition by BPEA IQT in 2022 and following its potential merger with Vistra. DERIVATION SUMMARY Fitch compares Thevelia with relevant peers in the business services sector. Apex Structured Intermediate Holdings Limited (B/Stable) is a global provider of services to alternative investment management and corporate sectors, but Fitch thinks Thevelia's greater EBITDA scale after combining Vistra and more favourable post-acquisition deleveraging trajectory justifies the high post-acquisition rating differential. Apex's leverage is also higher following several partly debt-funded acquisitions. Intermediate Dutch Holdings B.V. (B+/Stable) will potentially have a stronger combined company if it completes its merger with GfK SE (BB-/Rating Watch Negative) to create a market leader in the retail measurement sector. Pro forma leverage should remain modest for the rating, despite increased debt for the merger, and be lower than Thevelia's following its Vistra acquisition. However, Thevelia's higher profitability and integration execution should accelerate its deleveraging path. EmployBridge Holding Co (B+/Stable) has a weaker business profile than Thevelia, with concentrated production, a lack of contracted sales and end-market cyclicality. However, EmployBridge's lower leverage justifies a similar rating to Thevelia after combining Vistra. KEY ASSUMPTIONS Fitch's Key Assumptions Within Its Rating Case for Pro Forma Post-Merger Entity - Annual revenue growth of 6%-7% in 2023-2026 - EBITDA margin of 35%-43% in 2023-2026 (2022 preliminary: 34%), excluding one-off costs related to acquisition integration - Capital intensity of 3%-4% in 2023-2026 (2022 preliminary: 4.7%) - Restricted cash of USD50 million as a buffer against integration cost overruns and benchmark rate volatility - Bolt-on acquisition spending of USD30 million annually from 2025 - Repayment of Vistra's prior debt upon completion of the proposed merger in 2023 - No restricted payment dividend upstreaming to sponsor - 1% loan amortisation of the existing TLB and incremental first-lien TLB denominated in US dollars annually Key Recovery Rating Assumptions - Thevelia (after combining Tricor and Vistra) would be reorganised as a going-concern in bankruptcy rather than liquidated, given its asset-light business model. - Fitch estimates a post-restructuring pro forma going concern EBITDA of around USD282 million. In this scenario, stress on EBITDA could result from a weakened standalone operation for Tricor and Vistra amid intense competition and customer attrition issues. - An enterprise value multiple of 6.0x is applied to the going concern EBITDA to calculate a post-reorganisation enterprise value. The multiple is in line with that of similar peers. This reflects Thevelia's enlarged market position following the proposed merger, high revenue visibility combined with geographic and customer diversification, and a strong cash-generative business. - Fitch deducted 10% of administrative claims from the enterprise value to account for bankruptcy and associated costs. - The total amount of first-lien secured debt for claims includes USD2.4 billion equivalent senior secured first- lien TLBs and an equally ranking USD350 million RCF that Fitch assumes to be fully drawn. This results in the senior secured first-lien debt instrument rating of 'BB-(EXP)' with a Recovery Rating 'RR3', one notch above the expected post-transaction IDR of 'B+'. RATING SENSITIVITIES Factors that could, individually or collectively, lead to positive rating action/upgrade: Fitch would resolve the RWP and consider upgrading the IDR to 'B+' and existing TLB to 'BB-' upon the merger completion, with envisaged terms, capital structure and pro forma performance in line with or better than Fitch's rating case. Factors that could, individually or collectively, lead to negative rating action/downgrade: - Fitch would remove the RWP and affirm the IDR at 'B' with a Stable Outlook and the existing TLB at 'B+' on Tricor's standalone basis if the proposed merger does not proceed. LIQUIDITY AND DEBT STRUCTURE Adequate Liquidity: Fitch expects Thevelia (on a Tricor standalone basis) to have sufficient liquidity following the acquisition and issuance of the TLB in June 2022. Tricor's prior outstanding debt was repaid upon the completion of the acquisition by Thevelia. Thevelia relies on cash flow from Tricor to fund its interest payments, which is supported by its forecast of consistent positive FCF generation. In addition, the company has access to an undrawn RCF of USD130 million. Upon the merger completion, Fitch expects the combined cash flow from Tricor and Vistra to be used to fund Thevelia's interest payments on the existing and newly issued TLBs. Fitch expects a minimum cash balance of USD250 million post-merger, sufficient to buffer operational needs. In addition, Fitch expects USD220 million to be added to the RCF following the acquisition, resulting in a total of USD350 million. ISSUER PROFILE Thevelia is an investment vehicle set up by BPEA EQT Asia to acquire and hold Tricor, adding Vistra upon acquisition completion. Tricor is a business expansion specialist with operations across Asia. It provides business, corporate, investor and other services to corporate customers. Vistra is a leading provider of corporate, trust and outsourcing services in 46 jurisdictions. SUMMARY OF FINANCIAL ADJUSTMENTS Fitch restricts USD50 million in cash as unavailable post-acquisition to account for additional buffer against higher benchmark rates, cost overruns to realise synergies as well as working capital outflow. ESG CONSIDERATIONS Unless otherwise disclosed in this section, the highest level of ESG credit relevance is a score of '3'. This means ESG issues are credit-neutral or have only a minimal credit impact on the entity, either due to their nature or the way in which they are being managed by the entity. Entity/Debt Rating Recovery Prior ----------- ------ -------- ----- Thevelia Holdings Limited LT IDR B Rating Watch On B Thevelia (US) LLC senior secured LT BB-(EXP)Expected Rating RR3 senior secured LT B+ Rating Watch On RR3 B+ Thevelia Finance, S.a r.l. senior secured LT BB-(EXP)Expected Rating RR3 THEVELIA HOLDINGS: S&P Places 'B' LT ICR on CreditWatch Positive ---------------------------------------------------------------- S&P Global Ratings placed its 'B' long-term issuer credit rating on Thevelia Holdings Ltd. and Vistra Group Holdings (BVI) I Ltd., and its 'B' issue rating on the first-lien term loans on both entities on CreditWatch with positive implications. The CreditWatch placement reflects the likelihood that S&P would raise the ratings by one-notch to 'B+' on completion of the transaction as proposed. Thevelia's proposed acquisition of Vistra will significantly enlarge Thevelia's scale, geographical footprint, and offerings in the corporate service industry. The Vistra acquisition will significantly strengthen Thevelia's position as one of the largest and most diversified players in the fund and corporate service globally.The company's operating scale will more than double, it will spread its geographical footprint in the U.S. and Europe, and extend its service offerings to the fund and private wealth segments. S&P estimates Thevelia's revenue share in its core Asia market will increase to 10%-12% post the deal, from 6%-7%. This should position the company to better take advantage of growth potential in Asia-Pacific. Most of Thevelia's peers are more entrenched in developed markets. Cost reductions and revenue synergies post the acquisition should drive up margins. Some of Thevelia's and Vistra's markets and services overlap, providing opportunities for the combined entity to reduce headcount, office premises, and implement shared services. Moreover, the services that Thevelia and Vistra provide are complementary. The combined entity can therefore cross-sell more services, and capture greater market share through a holistic service offering. These factors could allow realization of annualized run-rate synergies, amounting to US$50 million in cost and US$30 million in revenue, over the likely integration period of three years. S&P expects the bulk of the synergies to occur in the latter years, where S&P Global Ratings adjusted EBITDA margin could improve toward 40%, from about 35% in the first year. The ownership of these two companies by Baring Private Equity Asia Ltd. should help to accelerate the process of integration, and reduce execution risks. The combined entity's leverage will rise. It will take on about US$600 million of incremental debt. On a proforma 2023 basis, we estimate Thevelia's adjusted debt-to-EBITDA ratio will reach above 8.0x following the acquisition. This compares with 7.0x for Thevelia and less than 6.0x for Vistra, on a stand-alone basis. Incremental financial risks from the transaction are elevated. This is given the high cost of debt and the large exposure to floating rates, amid rising interest rates. S&P said, "We believe Thevelia will gradually deleverage.The combined entity will benefit from steady cash flow from recurring corporate services and the realization of synergies from the merger. We estimate its free operating cash flow will exceed US$100 million annually. This amount should be adequate to finance any future bolt-on acquisitions without requiring material debt-raising. We forecast the combined entity's debt-to-EBITDA will fall gradually toward 6.0x by 2025." Furthermore, Baring has a record of reducing leverage at Vistra. Since Baring acquired the company in 2015, Vistra's adjusted debt-to-EBITDA had fallen to about 6.0x in 2022, from about 8.5x in 2016. In the past three years, Vistra has focused on organic growth via transformative programs, supported by bolt-on acquisitions. Historically, Baring has not been aggressive in pursuing dividend recapitalization. S&P assumes it will adopt a similar policy on the combined entity at least for the next three years. S&P said, "Post the acquisition, we will view Vistra as a core subsidiary of Thevelia. As such, we will equalize our rating on Vistra with that on Thevelia, which will fully own the company. We estimate Vistra will account for more than 65% of the group's revenues and close to 60% of its EBITDA in the first one to two years post the acquisition. Vistra operates in the same fund and corporate services business as Thevelia. "Furthermore, Thevelia will be able to expand its geographical presence and customer reach to Europe by tapping Vistra's existing network. We expect the combined entity to operate as a single service provider, given the shared ownership under Baring." Meanwhile, the refinancing of Vistra's existing revolver credit facility and first-lien term loan due in October 2025 as part of the acquisition deal will reduce any near-term refinancing risk for the group. S&P said, "Additional debt for the acquisition will reduce recovery prospects of first-lien debt holders in a hypothetical event of default. The incremental first-lien debt and revolving credit facilities (that we assume will be 85% used in our recovery analysis) will be drawn under Thevelia's existing facilities. Our preliminary assessment shows that the recovery prospects will reduce to 55%, from 65% previously, but the existing '3' recovery rating on the rated debt will not change. "We plan to resolve the CreditWatch on completion of Thevelia's proposed acquisition of Vistra. "We would raise our ratings on Thevelia and on Vistra by one notch to 'B+', assuming the transaction is completed as proposed and our operating assumptions see no substantial change. "We would affirm our ratings on Thevelia and on Vistra if the proposed acquisition does not go through." ESG credit indicators: E-2, S-2, G-3 S&P said, "Governance factors are a moderately negative consideration in our credit rating analysis of Thevelia and Vistra, as it is for most rated entities owned by private-equity sponsors. Both entities are wholly owned by Baring. We believe the companies' highly leveraged financial risk profile points to corporate decision-making that could prioritize the interests of the controlling owners. This also reflects private-equity sponsors' generally finite holding periods and focus on maximizing shareholder returns." ========= I N D I A ========= ABHIMAANI PRAKASHANA: CRISIL Keeps C Ratings in Not Cooperating --------------------------------------------------------------- CRISIL Ratings said the ratings on bank facilities of Abhimaani Prakashana (AP) continue to be 'CRISIL C/CRISIL A4 Issuer Not Cooperating'. Amount Facilities (INR Crore) Ratings ---------- ----------- ------- Bank Guarantee 2 CRISIL A4 (Issuer Not Cooperating) Bill Purchase 2 CRISIL A4 (Issuer Not Cooperating) Cash Credit 6 CRISIL C (Issuer Not Cooperating) CRISIL Ratings has been consistently following up with AP) for obtaining information through letters and emails dated December 24, 2022 and February 17, 2023 among others, apart from telephonic communication. However, the issuer has remained non cooperative. 'The investors, lenders and all other market participants should exercise due caution with reference to the rating assigned/reviewed with the suffix 'ISSUER NOT COOPERATING' as the rating is arrived at without any management interaction and is based on best available or limited or dated information on the company. Such non co-operation by a rated entity may be a result of deterioration in its credit risk profile. These ratings with 'ISSUER NOT COOPERATING' suffix lack a forward looking component.' Detailed Rationale Despite repeated attempts to engage with the management, CRISIL Ratings failed to receive any information on either the financial performance or strategic intent of AP, which restricts CRISIL Ratings' ability to take a forward looking view on the entity's credit quality. CRISIL Ratings believes that rating action on AP is consistent with 'Assessing Information Adequacy Risk'. Based on the last available information, the ratings on bank facilities of AP continues to be 'CRISIL C/CRISIL A4 Issuer Not Cooperating'. Abhimani Prakashana is a proprietorship concern of Mr T Venkatesh, constituted in 1954 is engaged in manufacturing of text books through its manufacturing of unit in Rajajinagar Bangalore for Karnataka Text Books Society. AL NAFEES: CRISIL Keeps D Debt Ratings in Not Cooperating --------------------------------------------------------- CRISIL Ratings said the ratings on bank facilities of Al Nafees Frozen Food Exports Private Limited (ANFF) continue to be 'CRISIL D/CRISIL D Issuer Not Cooperating'. Amount Facilities (INR Crore) Ratings ---------- ----------- ------- Bank Guarantee 5 CRISIL D (Issuer Not Cooperating) Cash Credit 93 CRISIL D (Issuer Not Cooperating) Cash Credit 140 CRISIL D (Issuer Not Cooperating) Foreign Bill Discounting 18 CRISIL D (Issuer Not Cooperating) Foreign Bill Discounting 25 CRISIL D (Issuer Not Cooperating) Foreign Bill Discounting 7 CRISIL D (Issuer Not Cooperating) Letter of Credit Bill Discounting 7 CRISIL D (Issuer Not Cooperating) Proposed Long Term Bank Loan Facility 60 CRISIL D (Issuer Not Cooperating) CRISIL Ratings has been consistently following up with ANFF for obtaining information through letters and emails dated December 30, 2022 and February 28, 2023 among others, apart from telephonic communication. However, the issuer has remained non cooperative. 'The investors, lenders and all other market participants should exercise due caution with reference to the rating assigned/reviewed with the suffix 'ISSUER NOT COOPERATING' as the rating is arrived at without any management interaction and is based on best available or limited or dated information on the company. Such non co-operation by a rated entity may be a result of deterioration in its credit risk profile. These ratings with 'ISSUER NOT COOPERATING' suffix lack a forward looking component.' Detailed Rationale Despite repeated attempts to engage with the management, CRISIL Ratings failed to receive any information on either the financial performance or strategic intent of ANFF, which restricts CRISIL Ratings' ability to take a forward looking view on the entity's credit quality. CRISIL Ratings believes that rating action on ANFF is consistent with 'Assessing Information Adequacy Risk'. Based on the last available information, the ratings on bank facilities of ANFF continues to be 'CRISIL D/CRISIL D Issuer Not Cooperating'. ANFF, promoted by Mr. Mohammad Mustaqeem Qureshi in 1987, is the flagship company of the Al Nafees group. It processes and exports buffalo meat. Its plant in Dasna (Uttar Pradesh) has capacity to process 150 tonnes per day (tpd) of frozen meat. Its rented plant in Hyderabad has a capacity of 90 tpd. ARIHANT INDUSTRIAL: CARE Reaffirms B+ Rating on INR12.76cr Loan --------------------------------------------------------------- CARE Ratings has reaffirmed ratings on certain bank facilities of Arihant Industrial Corporation Limited (AICL), as: Amount Facilities (INR crore) Ratings ---------- ----------- ------- Long Term Bank 12.76 CARE B+; Stable Reaffirmed Facilities Long Term/ 11.50 CARE B+; Stable/CARE A4 Short Term Reaffirmed Bank Facilities Rationale and key rating drivers The reaffirmation in the ratings assigned to the bank facilities of AICL takes into account the significant deterioration in overall financial risk profile in FY22 marked by modest scale of operations with operating loss incurred during FY22, highly leveraged capital structure and distressed debt coverage indicators with stretched liquidity position. The rating also considers the improvement in financial performance during the current year with respect to both revenues and profitability margins. AICL's performance continues to be constrained by weak profitability margins with susceptibility to volatile input prices, working capital intensive nature of operations, foreign exchange fluctuation risk and presence in a competitive, seasonal & cyclical industry. AICL continues to derive strength from the company's long track record of over three decades of operations coupled with long experience of the promoters in recreation & engineering industry. Rating sensitivities: Factors likely to lead to rating actions Positive factors * Increase in the scale of operations with a total operating income exceeding INR90.00 crore. * Improvement in the capital structure with the overall gearing reaching below 3x on a sustained basis. * Improvement in the collection period below 90 days on a sustained basis. Negative factors * Deterioration in the utilization of the working capital limits exceeding 90% on a sustained basis. * Subsequent erosion of net worth below current level. Analytical approach: Standalone Outlook: Stable Stable outlook reflects that the AICL will continue to benefit from the experience of the promoters along with improvement in financial performance observed during 10 M FY 23. Key weaknesses * Modest scale of operations: The scale of operations of AICL has been modest over the years however had improved by ~69% in FY22 with the total operating income of INR59.52 crore in FY22 from INR35.23 crore in FY21 mainly on account of pent-up demand post COVID pandemic. As per management, AICL has reported sales of approximately INR73 crore from Apr-22 to Jan-23 and they have an order book position of ~ INR45 crore as on February 21, 2023 which is to be executed in FY23 and FY24. * Weak profitability position coupled with susceptibility to volatile input prices: From FY18 to FY22, the company had continued to incur operational and net loss, however the operating loss i.e PBILDT margin improved from -38.28% in FY21 to -3.75% in FY22 mainly due to improvement in its total operating Income due to pent up demand post COVID pandemic. The profitability margins of the company have been unstable primarily due to fluctuation in price of raw materials, which are crude oil derivatives. AICL's primary raw materials comprise of FRP, fibre mates, unsaturated polyester resins, etc., whose prices are volatile being linked to those of crude oil, thereby implying susceptibility of the company's profit margins. Nevertheless, the company continues to incur operating loss, thereby the profitability position continues to remain weak. As per management during 10M FY23, AICL has reported PBILDT of INR5.58 Crs and PAT of INR0.81 Crs. * Working capital intensive nature of operations: The working capital cycle of AICL improved at 43 days in FY22 vis-à-vis 203 days in FY21 due to significant improvement in its collection period and better inventory management during FY22. AICL had written off bad debts of INR0.20 crore in FY22 and INR0.04 crore in FY21. Also, the average WC utilization in the last 12 months ended December 2022 stood at ~76% providing sufficient headroom for incremental working capital needs and also its net cash flow from operating activities stood positive at INR20.18 crore as on March 31, 2022. * Presence in competitive, seasonal & cyclical industry: AICL is exposed to cyclicality in the real estate industry with regard to the playground equipment business, whereas it is also exposed to competition from the overseas water rides manufacturing players with regard to the water park equipment manufacturing business. Moreover, the company is also exposed to seasonality in the water park operations, given the subdued footfall in winters and monsoons. Key strength * Long track record of operations: AICL possesses a long track record of over three decades of operations in manufacturing of playground equipment & water park equipment and over two decades of operations in operating a Water Park. The entity commenced playground equipment and water park equipment manufacturing operations in 1983 and 1990 respectively. Thereafter, in 1996, it commenced the water park operations. The entity also exports its products to various countries across the globe and it is compliant with the stringent safety & quality compliances required by the overseas customers. The company complies with ASTM, EN and TUV certifications for most of its installations. Over the years of its operations, the company has established long-term relationships with various customers, suppliers and other stakeholders. * Highly experienced promoters in recreation & engineering industry: The overall operations of AICL are looked after by the promoters Mr. Rajen Shah and Mrs. Neeta Shah, who possess average experience of over four decades in the field of engineering and recreation products manufacturing. Liquidity: Streched Liquidity is marked by free cash balance of approximately INR4.83 crore as on January 17, 2023. The average utilization of its working capital limits during past 12 months ended December 2022 stood high at ~76%. Further its current ratio and quick ratio stood below unity at 0.65 times and 0.38 times respectively as on March 31, 2022. Established as a partnership firm in 1978 by Mr. Virendra Shah and Mr. Atul Safari, Arihant Industries was later converted into a private limited company and renamed as Arihant Machine Builders & Structural Engineers Private Limited in 1984, thereafter which it was converted into a public limited company and renamed as Arihant Machine Builders & Structural Engineers Limited and in 1995, and finally renamed as Arihant Industrial Corporation Limited (AICL; public unlisted company) in 1996. AICL is engaged in manufacturing of recreational industry equipment viz. playground equipment, fitness equipment and water park equipment. Moreover, it also operates a 26-acre water park in Virar, Maharashtra. The playground equipment manufactured by the company is sold to the government as well as the corporate customers, whereas the water park equipment is catered to the water park operators in India and various countries overseas viz. Vietnam, Thailand, Algeria, Bulgaria, Colombia, Egypt, Ethiopia, Italy, Malaysia, Maldives, Mexico, Nepal, Philippines, Portugal, Spain, Ukraine, USA, etc. On the other hand, the raw materials viz. FRP (Fibre-reinforced Plastic), fibre mates, unsaturated polyester resins, gel-coat, pipes, etc. are procured from the domestic manufacturers, whereas a certain portion is imported from Malaysia and China. ELA EDUCATIONAL: CRISIL Lowers Rating on INR8.85cr LT Loan to D --------------------------------------------------------------- CRISIL Ratings has downgraded its rating on the long-term bank facilities of ELA Educational Trust (ELEDTR) to 'CRISIL D' from 'CRISIL B-/Stable'. Amount Facilities (INR Crore) Ratings ---------- ----------- ------- Long Term Loan 8.85 CRISIL D (Downgraded from 'CRISIL B-/Stable') Secured Overdraft Facility 0.75 CRISIL D (Downgraded from 'CRISIL B-/Stable') Working Capital Term Loan 2.40 CRISIL D (Downgraded from 'CRISIL B-/Stable') The downgrade of ELEDTR reflects delays in servicing debt obligations in February 2023 The rating also reflects its Small scale of operations and Poor financial risk profile and Geographical concentration in revenue. These rating weaknesses are partially offset by the extensive experience of the trustee Key Rating Drivers & Detailed Description Weaknesses: * Small scale of operations: The academic year 2018-19 was the first full year of operations for ELA. The Trust is currently scaling up and occupancy is low currently and revenue is achieved INR1.56 crore in the fiscal 2022 , it is expected to gradually improve over the medium term with improving occupancy levels. * Poor financial risk profile: Gearing is negative at -18.03 times as on March 31, 2022 and expected to remain same over the medium term owing to the large debt-funded with negative networth. The debt protection metrics are weak due to negative accruals expected in the near term due to operating losses. * Geographical concentration in revenue: ELA operates a single school in Chennai. This leads to a geographic concentration in revenue. Demand for IB curriculum in Chennai is moderate currently, however, will improve gradually given the success of IB in other cities such as Delhi, Mumbai and Hyderabad. Although there are few schools offering the IB course in Chennai, supply will also gradually increase with more schools offering IB courses which may lead to higher competition in the long term Strength: * Experience of the trustees: The trustees have over three decades of experience in the education industry with prior experience as professors at the Madras University. The trustee's experience will enable a competitive curriculum leading to healthy traction amongst prospective students and help the institution scale up its revenue over the medium term Liquidity: Poor There has been an instance of delay in repayment of term loan in the month of February 2023, it further constrain the liquidity Rating Sensitivity factors Upward Factors * Regularization of timely debt repayment with a track record of 90 days * Efficient working capital management leading to moderation in bank limit utilization ELA, a non-profit association set up in 2017, operates a school in Maraimalia Nagar, Chennai. The school provides education under a Geneva based curriculum and has grades spanning from preschool, elementary, middle, and high school levels. Ms M Samhita (managing trustee), Mr Madanagobalane and Ms G Vijayalakshmi, all of whom are professors at the Madras University, are the trustees. ETA ENGINEERING: CRISIL Keeps D Debt Ratings in Not Cooperating --------------------------------------------------------------- CRISIL Ratings said the ratings on bank facilities of ETA Engineering Private Limited (ETA Engineering) continue to be 'CRISIL D/CRISIL D Issuer Not Cooperating'. Amount Facilities (INR Crore) Ratings ---------- ----------- ------- Cash Credit 45 CRISIL D (Issuer Not Cooperating) Cash Credit 17 CRISIL D (Issuer Not Cooperating) Cash Credit 3 CRISIL D (Issuer Not Cooperating) Cash Credit 30 CRISIL D (Issuer Not Cooperating) Letter of credit 276 CRISIL D (Issuer Not & Bank Guarantee Cooperating) Letter of credit 20 CRISIL D (Issuer Not & Bank Guarantee Cooperating) Letter of credit 5.25 CRISIL D (Issuer Not & Bank Guarantee Cooperating) Letter of credit 140 CRISIL D (Issuer Not & Bank Guarantee Cooperating) Proposed Short Term 97.4 CRISIL D (Issuer Not Bank Loan Facility Cooperating) CRISIL Ratings has been consistently following up with ETA for obtaining information through letters and emails dated December 31, 2022 and February 28, 2023 among others, apart from telephonic communication. However, the issuer has remained non cooperative. 'The investors, lenders and all other market participants should exercise due caution with reference to the rating assigned/reviewed with the suffix 'ISSUER NOT COOPERATING' as the rating is arrived at without any management interaction and is based on best available or limited or dated information on the company. Such non co-operation by a rated entity may be a result of deterioration in its credit risk profile. These ratings with 'ISSUER NOT COOPERATING' suffix lack a forward looking component.' Detailed Rationale Despite repeated attempts to engage with the management, CRISIL Ratings failed to receive any information on either the financial performance or strategic intent of ETA Engineering, which restricts CRISIL Ratings' ability to take a forward looking view on the entity's credit quality. CRISIL Ratings believes that rating action on ETA Engineering is consistent with 'Assessing Information Adequacy Risk'. Based on the last available information, the ratings on bank facilities of ETA Engineering continues to be 'CRISIL D/CRISIL D Issuer Not Cooperating'. Incorporated in 1994, ETA Engineering is a part of the Dubai-based ETA group; the company undertakes heating, ventilating, and air-conditioning (HVAC) projects; electromechanical projects and services (EMPS); and MEP works. In 2006, the ETA group entered the multi-modal logistics business by obtaining a licence from the Indian Railways through ETA Engineering, the license was subsequently sold in 2012-13. FAMOUS STATIONERY: CRISIL Keeps D Debt Ratings in Not Cooperating ----------------------------------------------------------------- CRISIL Ratings said the ratings on bank facilities of Famous Stationery Private Limited (FSPL) continue to be 'CRISIL D/CRISIL D Issuer Not Cooperating'. Amount Facilities (INR Crore) Ratings ---------- ----------- ------- Cash Credit 4 CRISIL D (Issuer Not Cooperating) Export Packing Credit 6 CRISIL D (Issuer Not Cooperating) Term Loan 9.8 CRISIL D (Issuer Not Cooperating) CRISIL Ratings has been consistently following up with FSPL for obtaining information through letters and emails dated December 30, 2022 and February 28, 2023 among others, apart from telephonic communication. However, the issuer has remained non cooperative. 'The investors, lenders and all other market participants should exercise due caution with reference to the rating assigned/reviewed with the suffix 'ISSUER NOT COOPERATING' as the rating is arrived at without any management interaction and is based on best available or limited or dated information on the company. Such non co-operation by a rated entity may be a result of deterioration in its credit risk profile. These ratings with 'ISSUER NOT COOPERATING' suffix lack a forward looking component.' Detailed Rationale Despite repeated attempts to engage with the management, CRISIL Ratings failed to receive any information on either the financial performance or strategic intent of FSPL, which restricts CRISIL Ratings' ability to take a forward looking view on the entity's credit quality. CRISIL Ratings believes that rating action on FSPL is consistent with 'Assessing Information Adequacy Risk'. Based on the last available information, the ratings on bank facilities of FSPL continues to be 'CRISIL D/CRISIL D Issuer Not Cooperating'. FSPL, incorporated in 2013, is promoted by Mr Jayantilal Mehta and his son Mr Ashish Mehta. It took over the business of its promoters' firm in 2014. Based in Palghar, Maharashtra, the company manufactures paper stationery such as textbooks, graph books, diaries, notebooks, envelopes, calendars, and practical papers. Most of its revenue comes from abroad. FIREFLY BATTERIES: CRISIL Keeps D Debt Ratings in Not Cooperating ----------------------------------------------------------------- CRISIL Ratings said the ratings on bank facilities of Firefly Batteries Private Limited (FBPL) continue to be 'CRISIL D/CRISIL D Issuer Not Cooperating'. Amount Facilities (INR Crore) Ratings ---------- ----------- ------- Bank Guarantee 1 CRISIL D (Issuer Not Cooperating) Cash Credit 7.7 CRISIL D (Issuer Not Cooperating) Term Loan 12.3 CRISIL D (Issuer Not Cooperating) CRISIL Ratings has been consistently following up with FBPL for obtaining information through letters and emails dated December 24, 2022 and February 17, 2023 among others, apart from telephonic communication. However, the issuer has remained non cooperative. 'The investors, lenders and all other market participants should exercise due caution with reference to the rating assigned/reviewed with the suffix 'ISSUER NOT COOPERATING' as the rating is arrived at without any management interaction and is based on best available or limited or dated information on the company. Such non co-operation by a rated entity may be a result of deterioration in its credit risk profile. These ratings with 'ISSUER NOT COOPERATING' suffix lack a forward looking component.' Detailed Rationale Despite repeated attempts to engage with the management, CRISIL Ratings failed to receive any information on either the financial performance or strategic intent of FBPL, which restricts CRISIL Ratings' ability to take a forward looking view on the entity's credit quality. CRISIL Ratings believes that rating action on FBPL is consistent with 'Assessing Information Adequacy Risk'. Based on the last available information, the ratings on bank facilities of FBPL continues to be 'CRISIL D/CRISIL D Issuer Not Cooperating'. FBPL (formerly, Epsilon Batteries Private Limited) was incorporated in 2011, and is managed by Mr Jinal Shah, Mr Satish Mehta, and Mr Anand Pandya. The company manufactures uninterruptible power supply (UPS) systems, inverters, advanced lead-acid batteries, and carbon foam batteries providing renewable energy storage solutions and load-shift applications. It commenced commercial operations from December 2014; its manufacturing facility in Bavla, Gujarat has an installed capacity of 0.3 million batteries per annum. It has a technical collaboration with Firefly International Energy USA. FOREMOST INTERNATIONAL: CRISIL Keeps D Ratings in Not Cooperating ----------------------------------------------------------------- CRISIL Ratings said the ratings on bank facilities of Foremost International Private Limited (FIPL) continue to be 'CRISIL D/CRISIL D Issuer Not Cooperating'. Amount Facilities (INR Crore) Ratings ---------- ----------- ------- Foreign Bill 2.45 CRISIL D (Issuer Not Discounting Cooperating) Foreign Bill 6.55 CRISIL D (Issuer Not Discounting Cooperating) Foreign Bill 2.45 CRISIL D (Issuer Not Discounting Cooperating) Foreign Bill 0.20 CRISIL D (Issuer Not Discounting Cooperating) Long Term Loan 1.10 CRISIL D (Issuer Not Cooperating) Packing Credit 6 CRISIL D (Issuer Not Cooperating) Packing Credit 3 CRISIL D (Issuer Not Cooperating) CRISIL Ratings has been consistently following up with FIPL for obtaining information through letters and emails dated December 24, 2022 and February 17, 2023 among others, apart from telephonic communication. However, the issuer has remained non cooperative. 'The investors, lenders and all other market participants should exercise due caution with reference to the rating assigned/reviewed with the suffix 'ISSUER NOT COOPERATING' as the rating is arrived at without any management interaction and is based on best available or limited or dated information on the company. Such non co-operation by a rated entity may be a result of deterioration in its credit risk profile. These ratings with 'ISSUER NOT COOPERATING' suffix lack a forward looking component.' Detailed Rationale Despite repeated attempts to engage with the management, CRISIL Ratings failed to receive any information on either the financial performance or strategic intent of FIPL, which restricts CRISIL Ratings' ability to take a forward looking view on the entity's credit quality. CRISIL Ratings believes that rating action on FIPL is consistent with 'Assessing Information Adequacy Risk'. Based on the last available information, the ratings on bank facilities of FIPL continues to be 'CRISIL D/CRISIL D Issuer Not Cooperating'. Incorporated in 2002, FIPL manufactures and exports RMG, predominantly for women, to Europe. The company, promoted by Mr Varun Moudgil and Ms Shailja Khanna, has its manufacturing plant in Gurgaon (Haryana). G.R.S. ISPAT: CRISIL Keeps D Debt Ratings in Not Cooperating ------------------------------------------------------------ CRISIL Ratings said the ratings on bank facilities of G.R.S. Ispat Company Private Limited (GICPL) continue to be 'CRISIL D Issuer Not Cooperating'. Amount Facilities (INR Crore) Ratings ---------- ----------- ------- Cash Credit 14.75 CRISIL D (Issuer Not Cooperating) Proposed Long Term 0.25 CRISIL D (Issuer Not Bank Loan Facility Cooperating) CRISIL Ratings has been consistently following up with GICPL for obtaining information through letters and emails dated December 24, 2022 and February 17, 2023 among others, apart from telephonic communication. However, the issuer has remained non cooperative. 'The investors, lenders and all other market participants should exercise due caution with reference to the rating assigned/reviewed with the suffix 'ISSUER NOT COOPERATING' as the rating is arrived at without any management interaction and is based on best available or limited or dated information on the company. Such non co-operation by a rated entity may be a result of deterioration in its credit risk profile. These ratings with 'ISSUER NOT COOPERATING' suffix lack a forward looking component.' Detailed Rationale Despite repeated attempts to engage with the management, CRISIL Ratings failed to receive any information on either the financial performance or strategic intent of GICPL, which restricts CRISIL Ratings' ability to take a forward looking view on the entity's credit quality. CRISIL Ratings believes that rating action on GICPL is consistent with 'Assessing Information Adequacy Risk'. Based on the last available information, the ratings on bank facilities of GICPL continues to be 'CRISIL D Issuer Not Cooperating'. Incorporated in 1995 by Mr Saket Saroha, GICPL started operations in March 2013. It trades in steel scrap, hot-rolled and cold-rolled steel coils, thermo-mechanically treated bars, and copper products. GANESH DIAGNOSTIC: CRISIL Keeps D Debt Ratings in Not Cooperating ----------------------------------------------------------------- CRISIL Ratings said the ratings on bank facilities of Ganesh Diagnostic and Imaging Centre Private Limited (GDICPL) continue to be 'CRISIL D/CRISIL D Issuer Not Cooperating'. Amount Facilities (INR Crore) Ratings ---------- ----------- ------- Long Term Loan 7.47 CRISIL D (Issuer Not Cooperating) Overdraft Facility 4.95 CRISIL D (Issuer Not Cooperating) Proposed Long Term 0.08 CRISIL D (Issuer Not Bank Loan Facility Cooperating) CRISIL Ratings has been consistently following up with GDICPL for obtaining information through letters and emails dated December 24, 2022 and February 17, 2023 among others, apart from telephonic communication. However, the issuer has remained non cooperative. 'The investors, lenders and all other market participants should exercise due caution with reference to the rating assigned/reviewed with the suffix 'ISSUER NOT COOPERATING' as the rating is arrived at without any management interaction and is based on best available or limited or dated information on the company. Such non co-operation by a rated entity may be a result of deterioration in its credit risk profile. These ratings with 'ISSUER NOT COOPERATING' suffix lack a forward looking component.' Detailed Rationale Despite repeated attempts to engage with the management, CRISIL Ratings failed to receive any information on either the financial performance or strategic intent of GDICPL, which restricts CRISIL Ratings' ability to take a forward looking view on the entity's credit quality. CRISIL Ratings believes that rating action on GDICPL is consistent with 'Assessing Information Adequacy Risk'. Based on the last available information, the ratings on bank facilities of GDICPL continues to be 'CRISIL D/CRISIL D Issuer Not Cooperating'. Set up in 2000 by Dr Ganesh Chand Sharma and Dr Ravin Sharma, GDICPL is engaged in lab testing (pathology) and radio imaging (radiology) at its laboratories in the Delhi NCR. GHODAWAT REALTY: Ind-Ra Places BB+ Long Term Issuer Rating on Watch ------------------------------------------------------------------- India Ratings and Research (Ind-Ra) has placed Ghodawat Realty Private Limited's (GRPL) Long-Term Issuer Rating of 'IND BB+' on Rating Watch with Developing Implications. The instrument-wise rating action is: -- INR809.70 mil. (reduced from INR982 mil.) Term loan due on December 2035 placed on Rating Watch with Developing Implications with IND BB+/Rating Watch with Developing Implications . Analytical Approach: Ind-Ra continues to take a consolidated view of GRPL and its 100% parent, Ghodawat Energy Private Limited (GEPL) to arrive at the ratings, as both the companies are under a common management and have strong legal linkages. Furthermore, GEPL is a co-applicant and has provided post-default corporate guarantees to the term loans availed by GRPL, making it jointly responsible for debt repayments in case GRPL faces liquidity issues. Ind-Ra has placed the ratings on Rating Watch with Developing Implications in view of the sale of commercial real-estate properties by GRPL towards the end of FY23. The agency will resolve the rating watch once it receives clarity on the utilization of the sale proceeds and its impact on cash flows. Key Rating Drivers Moderate Operational Risks: GRPL has started to sell power to private institutional businesses since a few of the power purchase agreements with the state governments have ended. However, the realizations reduced during FY21-FY22 despite an increase in the plant load factor (PLF) (FY22:15%; FY21:12%) due to low rates of electricity. The receivable days stood at 129 days in FY22 (FY21:210 days). Ind-Ra expects receivables days to reduce in the medium term due to sales made to private institutional players. Furthermore, the management believes the current market prices (less than INR3 per unit) are at their lowest and the prices are unlikely to fall further in the medium term. Out of the outstanding receivables of INR162.42 million as of December 31, 2022, approximately 59% pertains to dues from the Rajasthan government for the sale of electricity. While these dues have been outstanding for more than 365 days, they are un-disputed and GRPL expects to recover the same. GRPL derived 21.82% of its income from lease rentals in FY22 (FY21: 24.17%). The company has reviewed and extended its lease agreements with few of its existing tenants in FY23. During 4QFY23, GRPL has sold a portion of the total leasable space of 0.158 million square feet to its existing tenant, on which it realized gains of INR569.40 million. GRPL is planning to invest the net proceeds into new investment properties. The company has an installed wind generation capacity of 21.2MW, with a reasonable operating history and an average PLF of 15.00% in FY22. It also operates a solar power plant of 7.5MW. GEPL has wind mills with a total capacity of 53.38MW, with a PLF of 14%-16%, of which about 33.10 MW is sold to discoms and 20.28MW to third parties. In addition, GEPL has a solar power plant with a capacity of 3.28MW. The windmills of both the companies have an average residual age of about eight years out of the total useful period of 25 years. The consolidated revenue increased to INR480.66 million in FY22 (FY21: INR433.57 million), led by a marginal increase in income from the sale of power. Ind-Ra expects the consolidated revenue to remain stable in the medium term. The company has multiple properties in various locations, with a total investment value of INR4070 million, that are in the process of development. GRPL holds a portion of the properties (FY22:INR609.925 million; FY21:INR569.198 million) as inventory. Decline in EBTIDA Margin: The ratings reflect the modest consolidated EBITDA margins due to the nature of the business. The margin fell to 34.71% in FY22 (FY21:45.30%) because of an increase in operating expenses. The ROCE was 1% in FY22 (FY20:1.60%). Ind-Ra expects the margin to be stable in FY23 and FY24. Liquidity Indicator - Stretched: The consolidated debt service coverage ratio (DSCR) is likely to remain below 1x during FY23-FY26, as the debt repayments and interest component would be high compared to the cash inflows from lease rentals and the energy segment. As per the management, the resultant liquidity issues would be mitigated to some extent by the interest income earned from investments in group firms and likely cash flows from the sale of developed real estate properties. GRPL's interest income declined sharply to INR29.42 million in FY22 (FY21: INR213.42 million), owing to the partial sale of such investment by GRPL during 2021. The consolidated debt repayment amounts to about INR192.50 million for FY23 and INR181.60 million for FY24. For all the loans, there is no mandatory requirement of debt service reserve account since most of them are loans against property. The receivables days reduced to 129 days in FY22 (FY21: 210 days) as a result of increased recoverability, particularly from the power segment. The Ghodawat group has a policy to invest surplus cash into other group firms if required and it also generates other income from such investments. Deterioration in Consolidated Leverage: The ratings factor in the moderate consolidated credit metrics due to the modest margins. The net financial leverage (net debt/operating EBITDA) deteriorated to 9.20x in FY22 (FY21: 7.40x) due to a decrease in the operating EBITDA to INR166.84 million (INR196.41 million). The interest coverage (operating EBITDA/gross interest expense) improved marginally to 1.37x in FY22 (FY21: 1.09x) due to decrease in interest expenses, Ind-Ra believes the metrics will not deteriorate in FY24 due to a likely marginal increase in the absolute EBIDTA. Moderate Counterparty Risk: The Maharashtra, Karnataka, and Gujarat discoms have moderate financials and liquidity profiles. However, the financial profiles of Rajasthan discoms have been under stress, and their profiles have been impacted further by deterioration in the state's already stressed financial position during the pandemic. Timely receipt of payments from the discoms will be a key monitorable. Promoter Experience: The ratings are supported by promoters' experience of over a decade in the energy sector. The Ghodawat group had operational wind capacity of 118MW and operational solar assets of 8.20MW as of December 31, 2022. The group has reasonable experience in the installation and commissioning of wind turbines and towers across Maharashtra, Gujarat, Madhya Pradesh, Rajasthan and Karnataka. The group also sells power to third parties. Rating Sensitivities The Rating Watch with Developing Implications indicates that the ratings may be affirmed or downgraded or upgraded. Ind-Ra is likely to resolve the rating watch once the agency receives clarity on the sale of commercial real-estate properties and utilization of proceeds from the sale. Company Profile GRPL (earlier name Topaz Investments Private Ltd) is a part of the Ghodawat group, with a major presence in Kolhapur, Maharashtra and some parts in Karnataka. GRPL generates and sells wind power and leases out commercial properties, while its parent company, GEPL operates in the wind energy generation segment. The Ghodawat group as a whole has business interests in agriculture, fast moving consumer goods, wind energy, mining, textiles, chemicals, education, aviation, labelling and real estate. HAZARIBAGH RANCHI: Ind-Ra Affirms 'D' NonConvertible Debt Rating ---------------------------------------------------------------- India Ratings and Research (Ind-Ra) has affirmed the ratings of Hazaribagh Ranchi Expressway Limited's (HREL) non-convertible debentures (NCDs) at 'IND D' as follows: -- INR5.380 bil. (outstanding INR2.267 bil. as of to date) Senior NCDs* affirmed with IND D rating; and -- INR1.770 bil. (outstanding INR673 mil. as of to date) Subordinate NCDs* affirmed with IND D rating. * Details in annexure Key Rating Drivers The affirmation reflects the delay in debt service until February 14, 2023. While the pending dues were cleared by February 14, 2023, three months of continuous timely debt servicing is required for a positive rating action. The National Company Law Appellate Tribunal order dated February 12, 2019 had classified HREL as 'Amber Entity'. 'Amber Entities' are defined as domestic group entities which are not able to meet all their obligations (financial and operational), but can meet only operational payment obligations and payment obligations to senior secured financial creditors'. On December 16, 2022, HREL was transferred to the Roadstar Infra Investment Trust (InvIT) and as part of the overall scheme of resolution of the debt of HREL, there was a repayment of over dues (principal and interest) along with a prepayment of partial debt of INR600 million on February 14, 2023. As of March 14, 2023, HREL had maintained a cash balance of INR1,040 million including a debt service reserve account of INR530 million equivalent to the next six months' interest and principal obligations. HREL has received 20 annuities from National Highways Authority of India (NHAI, 'IND AAA'/Stable) as of March 10, 2023. HREL received the 20th annuity on October 26, 2022 with delay of about 42 days, post deduction towards damages for maintenance-related deficiencies of around 1.4% of gross annuity amount and a statutory deduction (TDS) of 2%. The company received its 19th annuity on May 5, 2022 with some delay (about 51 days), withholding of INR63.5 million (10% of gross annuity amount) due to interruptions in the major maintenance works and damages of INR5.3 million (0.8% of gross annuity amount) on account of deficiencies in regular maintenance. However, as per management, the withheld amount is expected to be released considering 90% of major maintenance works has now been completed. Rating Sensitivities Positive: Timely debt servicing for three consecutive months will result in a rating upgrade. ESG Issues ESG Factors Minimally Relevant to Rating: Unless otherwise disclosed in this section, the ESG issues are credit neutral or have only a minimal credit impact on HREL due to either their nature or the way in which they are being managed by the entity and sponsor. Company Profile HREL is a special purpose vehicle created by IL&FS Transportation Networks Limited ('IND D') for designing, constructing and maintaining the four-lane Hazaribagh–Ranchi section of NH 33 in Jharkhand to 114km from 40.5km on a build-operate-transfer-annuity basis. The National Highways Authority of India had awarded the project to HREL under a competitive bidding process. The company received the final completion certificate on April 1, 2015. HEBBAL PROPERTIES: Ind-Ra Withdraws B NonConvertible Debt Rating ---------------------------------------------------------------- India Ratings and Research (Ind-Ra) has withdrawn Hebbal Properties Private Limited's (HPPL) proposed non-convertible debentures' (NCDs) rating as follows: -- The IND B/Stable rating on the INR2.0 bil. Proposed NCDs is withdrawn. Key Rating Drivers Ind-Ra is no longer required to maintain the rating as the company did not proceed with the instrument as envisaged. This is consistent with Ind-Ra's Policy on Withdrawal of Ratings. Company Profile HPPL was incorporated on March 11, 2021 and is based out of Bengaluru. It is part of the Century Group. HPPL is engaged in the development of management services, which comprise overall project management, vendor appointments, billing activities and allied services required for the project. It provides development management service to its group entity Township Promoters for a commercial project located in Jakkur plantation village, Bengaluru. HINDUSTAN CLEANENERGY: Ind-Ra Keeps D Rating in Non-Cooperating --------------------------------------------------------------- India Ratings and Research (Ind-Ra) has maintained Hindustan Cleanenergy Limited's Long-Term Issuer Rating in the non-cooperating category. The issuer did not participate in the rating exercise despite continuous requests and follow-ups by the agency. Therefore, investors and other users are advised to take appropriate caution while using these ratings. The rating will continue to appear as 'IND D (ISSUER NOT COOPERATING)' on the agency's website. The instrument-wise rating action is: -- INR447 mil. Non-convertible debentures (Long term) ISIN INE047M07015 issued May 10, 2016 coupon rate 10% due on February 28, 2022 maintained in the non-cooperating category with IND D (ISSUER NOT COOPERATING) rating. ISSUER NOT COOPERATING: The ratings were last reviewed on March 16, 2022. Ind-Ra is unable to provide an update, as the agency does not have adequate information to review the ratings. Company Profile Incorporated in October 2008, Hindustan Cleanenergy is a 100% subsidiary of Hindustan Powerprojects Private Limited which is a multi-fuel-based power projects developer. The company was set up with an objective to serve as the solar holding company of the group and to undertake development of solar power projects worldwide. HOTEL SWOSTI: Ind-Ra Hikes LongTerm Issuer Rating to BB+ -------------------------------------------------------- India Ratings and Research (Ind-Ra) has upgraded Hotel Swosti Pvt Ltd.'s (HSPL) Long-Term Issuer Rating to 'IND BB+' from 'IND BB (ISSUER NOT COOPERATING)'. The Outlook is Stable. The instrument-wise rating actions are: -- INR7.5 mil. Fund-based facilities upgraded with IND BB+/Stable rating; and -- INR20 mil. (reduced from INR39.59 mil.) Term loan due on September 2027 upgraded with IND BB+/Stable rating. The upgrade reflects an improvement in HSPL's revenue and absolute EBITDA in FY22. Key Rating Drivers HSPL's revenue increased to INR91.39 million in FY22 (FY21: INR48.60 million), due to the normalization of its operations post-COVID-19 and an improvement in demand in the tourism industry. The scale of operations continues to remain small. Till 9MFY23, HPSL booked revenue of INR100 million, of which INR47.5 million came in from room bookings and INR48 million from banquet, food and beverage. HSPL booked an occupancy rate of 75.9% in 9MFY23 (9MFY22: 58.7%). In FY23 and FY24, Ind-Ra expects the revenue to improve, led by better occupancy rate following a rise in demand for the tourism industry. The ratings also factor in HSPL's continued modest EBITDA margin of 22.12% in FY22 (FY21: 10.75%; FY20: 20.97%) due to the normalization of the operations post-COVID-19. Additionally, the margins improved due to its higher revenue from food and beverage (which offer higher margins) as the customers chose to dine inside the hotel itself due to the fear of COVID-19 contamination. The return on capital employed improved to 7.4% in FY22 (FY20: negative 0.7%). In FY23, the management expects the EBITDA margin to remain at the similar level. Liquidity Indicator - Stretched: HSPL's net working capital cycle remained elongated at 134 days in FY22 (FY21: 157 days), due to a reduction in the debtor days to 85 days (152 days). The company's average maximum utilization of the fund-based limits was 58.64% during the 12 months ended December 2022. The cash flow from operations was at INR21.36 million in FY22 (FY21: negative INR3.22 million), due to an increase in the fund-flow from operations to INR16.5 million (FY21: INR1.76 million). The cash and cash equivalents stood at INR29.72 million at FYE22 (FYE21: INR6.47 million). Furthermore, HSPL does not have any capital market exposure and relies on banks and financial institutions to meet its funding requirements. The company has scheduled debt repayments of approximately INR9.7 million and INR4.4 million for FY23 and FY24, respectively. However, the ratings are supported by the promoters' nearly three decades of experience in the hotel and tourism industry. The ratings also reflect HSPL's healthy credit metrics, due to low debt with its gross interest coverage (operating EBITDA/gross interest expenses) rising of 6.9x in FY22 (FY21: 1.3x) and the net leverage (total adjusted net debt/operating EBITDAR) falling to 0.01x (4.11x), due to an increase in absolute EBITDA to INR20.22 million (FY21: INR5.18 million). In FY23, Ind-Ra expects the credit metrics to improve due to increase in its revenue. Rating Sensitivities Positive: A significant rise in the revenue while improving the credit metrics and liquidity, on a sustained basis, may lead to a positive rating action. Negative: A decline in the scale of operations or any debt-led capex leading to the net leverage increasing above 5x, on a sustained basis, will be negative for the ratings. Company Profile Incorporated in 1981, HSPL operates Swosti Grand, a four-star luxury business hotel in Bhubaneswar, Odisha. The hotel features 56 rooms with well-appointed modern facilities and amenities, four banquet halls, boardrooms, and restaurants. The hotel, which commenced operations in 1984, is managed by Jitendra Kumar Mohanty, Bijendra Kumar Mohanty, Chiranjiv Mohanty, Bipasa Mohanty and Sasmita Mohanty. KERALA TRANSPORT: CRISIL Keeps D Debt Ratings in Not Cooperating ---------------------------------------------------------------- CRISIL Ratings said the ratings on bank facilities of Kerala Transport Company (KTC) continue to be 'CRISIL D/CRISIL D Issuer Not Cooperating'. Amount Facilities (INR Crore) Ratings ---------- ----------- ------- Bank Guarantee 3 CRISIL D (Issuer Not Cooperating) Cash Credit 3 CRISIL D (Issuer Not Cooperating) Cash Credit 33 CRISIL D (Issuer Not Cooperating) Cash Credit 6 CRISIL D (Issuer Not Cooperating) CRISIL Ratings has been consistently following up with KTC for obtaining information through letters and emails dated December 24, 2022 and February 17, 2023 among others, apart from telephonic communication. However, the issuer has remained non cooperative. 'The investors, lenders and all other market participants should exercise due caution with reference to the rating assigned/reviewed with the suffix 'ISSUER NOT COOPERATING' as the rating is arrived at without any management interaction and is based on best available or limited or dated information on the company. Such non co-operation by a rated entity may be a result of deterioration in its credit risk profile. These ratings with 'ISSUER NOT COOPERATING' suffix lack a forward looking component.' Detailed Rationale Despite repeated attempts to engage with the management, CRISIL Ratings failed to receive any information on either the financial performance or strategic intent of KTC, which restricts CRISIL Ratings' ability to take a forward looking view on the entity's credit quality. CRISIL Ratings believes that rating action on KTC is consistent with 'Assessing Information Adequacy Risk'. Based on the last available information, the ratings on bank facilities of KTC continues to be 'CRISIL D/CRISIL D Issuer Not Cooperating'. For arriving at its ratings, CRISIL Ratings has combined the business and financial risk profiles of KTC and Kalpaka Transport Company Pvt Ltd (KTCPL). This is because the two entities, together referred to as the KTC group, are in the same line of business, under a common management, and have significant operational linkages and fungible cash flows between them. KTC, setup in 1958 and KTCPL setup in 1973, is promoted by Mr P V Chandran and family members. It provides freight transportation services to players in the fast- moving consumer goods, automobiles, paints, and tyres industries all over India. In addition to the logistics business, the firm also owns and operates two Indian Oil Corporation fuel bunks in Calicut, Kerala and provides clearing and shipping services at the Cochin Airport and the Cochin Port. KEW INDUSTRIES: CRISIL Keeps D Debt Ratings in Not Cooperating -------------------------------------------------------------- CRISIL Ratings said the ratings on bank facilities of KEW Industries Limited (KEW) continue to be 'CRISIL D Issuer Not Cooperating'. Amount Facilities (INR Crore) Ratings ---------- ----------- ------- Cash Credit 5 CRISIL D (Issuer Not Cooperating) Cash Credit 9.95 CRISIL D (Issuer Not Cooperating) Term Loan 1.05 CRISIL D (Issuer Not Cooperating) CRISIL Ratings has been consistently following up with KEW for obtaining information through letters and emails dated December 30, 2022 and February 28, 2023 among others, apart from telephonic communication. However, the issuer has remained non cooperative. 'The investors, lenders and all other market participants should exercise due caution with reference to the rating assigned/reviewed with the suffix 'ISSUER NOT COOPERATING' as the rating is arrived at without any management interaction and is based on best available or limited or dated information on the company. Such non co-operation by a rated entity may be a result of deterioration in its credit risk profile. These ratings with 'ISSUER NOT COOPERATING' suffix lack a forward looking component.' Detailed Rationale Despite repeated attempts to engage with the management, CRISIL Ratings failed to receive any information on either the financial performance or strategic intent of KEW, which restricts CRISIL Ratings' ability to take a forward looking view on the entity's credit quality. CRISIL Ratings believes that rating action on KEW is consistent with 'Assessing Information Adequacy Risk'. Based on the last available information, the ratings on bank facilities of KEW continues to be 'CRISIL D Issuer Not Cooperating'. Kew was formed as a proprietary firm, Kew Engineering Works, in 1963 by Mr Gurbachan Juneja. This was reconstituted as a partnership firm in 1995, and subsequently as a limited company with the present name in 1996. KUTTANAD RUBBER: CRISIL Keeps D Debt Ratings in Not Cooperating --------------------------------------------------------------- CRISIL Ratings said the ratings on bank facilities of Kuttanad Rubber Co Limited (KRCL) continue to be 'CRISIL D Issuer Not Cooperating'. Amount Facilities (INR Crore) Ratings ---------- ----------- ------- Cash Credit/ 2 CRISIL D (Issuer Not Overdraft facility Cooperating) Long Term Loan 5.4 CRISIL D (Issuer Not Cooperating) CRISIL Ratings has been consistently following up with KRCL for obtaining information through letters and emails dated December 24, 2022 and February 17, 2023 among others, apart from telephonic communication. However, the issuer has remained non cooperative. 'The investors, lenders and all other market participants should exercise due caution with reference to the rating assigned/reviewed with the suffix 'ISSUER NOT COOPERATING' as the rating is arrived at without any management interaction and is based on best available or limited or dated information on the company. Such non co-operation by a rated entity may be a result of deterioration in its credit risk profile. These ratings with 'ISSUER NOT COOPERATING' suffix lack a forward looking component.' Detailed Rationale Despite repeated attempts to engage with the management, CRISIL Ratings failed to receive any information on either the financial performance or strategic intent of KRCL, which restricts CRISIL Ratings' ability to take a forward looking view on the entity's credit quality. CRISIL Ratings believes that rating action on KRCL is consistent with 'Assessing Information Adequacy Risk'. Based on the last available information, the ratings on bank facilities of KRCL continues to be 'CRISIL D Issuer Not Cooperating'. KRCL is a closely held public limited company and operates a rubber plantation of around 440 acres in Kanjirapally (Kerala). The company extracts raw rubber latex from its plantation and sells it to local centrifuged latex (cenex; used in making medical and surgical items) manufactures. The daily operations of the company are managed by the executive director, Mr. Joseph Thomas. LAGGAR INDUSTRIES: CRISIL Keeps D Debt Rating in Not Cooperating ---------------------------------------------------------------- CRISIL Ratings said the rating on bank facilities of Laggar Industries Limited (LIL) continues to be 'CRISIL D Issuer Not Cooperating'. Amount Facilities (INR Crore) Ratings ---------- ----------- ------- Cash Credit 14 CRISIL D (Issuer Not Cooperating) CRISIL Ratings has been consistently following up with LIL for obtaining information through letters and emails dated December 24, 2022 and February 17, 2023 among others, apart from telephonic communication. However, the issuer has remained non cooperative. 'The investors, lenders and all other market participants should exercise due caution with reference to the rating assigned/reviewed with the suffix 'ISSUER NOT COOPERATING' as the rating is arrived at without any management interaction and is based on best available or limited or dated information on the company. Such non co-operation by a rated entity may be a result of deterioration in its credit risk profile. These ratings with 'ISSUER NOT COOPERATING' suffix lack a forward looking component.' Detailed Rationale Despite repeated attempts to engage with the management, CRISIL Ratings failed to receive any information on either the financial performance or strategic intent of LIL, which restricts CRISIL Ratings' ability to take a forward looking view on the entity's credit quality. CRISIL Ratings believes that rating action on LIL is consistent with 'Assessing Information Adequacy Risk'. Based on the last available information, the ratings on bank facilities of LIL continues to be 'CRISIL D Issuer Not Cooperating'. LIL was incorporated by Mr Sandeep Sobti in 1990. The company manufactures and trades in bullet-proof steel which is used primarily in bullet-proof jackets and in armored vehicles. The company has a rolling mill with installed capacity of 30,000 tonne per annum in Jalandhar, Punjab. LAXMI ENGINEERING: CRISIL Keeps D Debt Ratings in Not Cooperating ----------------------------------------------------------------- CRISIL Ratings said the ratings on bank facilities of Laxmi Engineering Industries (Bhopal) Private Limited (LEIPL) continue to be 'CRISIL D/CRISIL D Issuer Not Cooperating'. Amount Facilities (INR Crore) Ratings ---------- ----------- ------- Bank Guarantee 10 CRISIL D (Issuer Not Cooperating) Cash Credit 17.5 CRISIL D (Issuer Not Cooperating) Rupee Term Loan 10.75 CRISIL D (Issuer Not Cooperating) CRISIL Ratings has been consistently following up with LEIPL for obtaining information through letters and emails dated December 24, 2022 and February 17, 2023 among others, apart from telephonic communication. However, the issuer has remained non cooperative. 'The investors, lenders and all other market participants should exercise due caution with reference to the rating assigned/reviewed with the suffix 'ISSUER NOT COOPERATING' as the rating is arrived at without any management interaction and is based on best available or limited or dated information on the company. Such non co-operation by a rated entity may be a result of deterioration in its credit risk profile. These ratings with 'ISSUER NOT COOPERATING' suffix lack a forward looking component.' Detailed Rationale Despite repeated attempts to engage with the management, CRISIL Ratings failed to receive any information on either the financial performance or strategic intent of LEIPL, which restricts CRISIL Ratings' ability to take a forward looking view on the entity's credit quality. CRISIL Ratings believes that rating action on LEIPL is consistent with 'Assessing Information Adequacy Risk'. Based on the last available information, the ratings on bank facilities of LEIPL continues to be 'CRISIL D/CRISIL D Issuer Not Cooperating'. LEIPL was set up in 1987, by Mr KK Gurjar. The company manufactures heat exchangers and oil coolers, at its plant in Bhopal, Madhya Pradesh. LEOLINE FOODS: CRISIL Keeps D Debt Ratings in Not Cooperating ------------------------------------------------------------- CRISIL Ratings said the ratings on bank facilities of Leoline Foods Private Limited (LFPL) continue to be 'CRISIL D Issuer Not Cooperating'. Amount Facilities (INR Crore) Ratings ---------- ----------- ------- Cash Credit 2 CRISIL D (Issuer Not Cooperating) Long Term Loan 6.23 CRISIL D (Issuer Not Cooperating) Proposed Fund- 4.37 CRISIL D (Issuer Not Based Bank Limits Cooperating) CRISIL Ratings has been consistently following up with LFPL for obtaining information through letters and emails dated December 24, 2022 and February 28, 2023 among others, apart from telephonic communication. However, the issuer has remained non cooperative. 'The investors, lenders and all other market participants should exercise due caution with reference to the rating assigned/reviewed with the suffix 'ISSUER NOT COOPERATING' as the rating is arrived at without any management interaction and is based on best available or limited or dated information on the company. Such non co-operation by a rated entity may be a result of deterioration in its credit risk profile. These ratings with 'ISSUER NOT COOPERATING' suffix lack a forward looking component.' Detailed Rationale Despite repeated attempts to engage with the management, CRISIL Ratings failed to receive any information on either the financial performance or strategic intent of LFPL, which restricts CRISIL Ratings' ability to take a forward looking view on the entity's credit quality. CRISIL Ratings believes that rating action on LFPL is consistent with 'Assessing Information Adequacy Risk'. Based on the last available information, the ratings on bank facilities of LFPL continues to be 'CRISIL D Issuer Not Cooperating'. Incorporated in 2015, LFPL is promoted by Mr Ramesh Kumar Agarwal and family. The company manufactures 2D and 3D pellets, pasta, and vermicelli at Choti Nawada, Patna (Bihar). LORD BALAJI: CRISIL Keeps D Debt Rating in Not Cooperating ---------------------------------------------------------- CRISIL Ratings said the rating on bank facilities of Lord Balaji Ware Housing Private Limited (Lord) continues to be 'CRISIL D Issuer Not Cooperating'. Amount Facilities (INR Crore) Ratings ---------- ----------- ------- Term Loan 10 CRISIL D (Issuer Not Cooperating) CRISIL Ratings has been consistently following up with Lord for obtaining information through letters and emails dated December 24, 2022 and February 17, 2023 among others, apart from telephonic communication. However, the issuer has remained non cooperative. 'The investors, lenders and all other market participants should exercise due caution with reference to the rating assigned/reviewed with the suffix 'ISSUER NOT COOPERATING' as the rating is arrived at without any management interaction and is based on best available or limited or dated information on the company. Such non co-operation by a rated entity may be a result of deterioration in its credit risk profile. These ratings with 'ISSUER NOT COOPERATING' suffix lack a forward looking component.' Detailed Rationale Despite repeated attempts to engage with the management, CRISIL Ratings failed to receive any information on either the financial performance or strategic intent of Lord, which restricts CRISIL Ratings' ability to take a forward looking view on the entity's credit quality. CRISIL Ratings believes that rating action on Lord is consistent with 'Assessing Information Adequacy Risk'. Based on the last available information, the ratings on bank facilities of Lord continues to be 'CRISIL D Issuer Not Cooperating'. Lord was set up in 2011, albeit operation commenced in April 2015. It constructs warehouse spaces and leases them to various customers in Delhi. The company has storage capacity of 2.70 lakhs sq. ft. Big Bazar and Mother Dairy are the main tenants, and nearly the entire space available has been leased out. LOTUS PROJECTS: CRISIL Keeps D Debt Ratings in Not Cooperating -------------------------------------------------------------- CRISIL Ratings said the ratings on bank facilities of Lotus Projects Private Limited (LPPL) continue to be 'CRISIL D Issuer Not Cooperating'. Amount Facilities (INR Crore) Ratings ---------- ----------- ------- Cash Credit 7.50 CRISIL D (Issuer Not Cooperating) Proposed Long Term 1.05 CRISIL D (Issuer Not Bank Loan Facility Cooperating) Term Loan 11.45 CRISIL D (Issuer Not Cooperating) CRISIL Ratings has been consistently following up with LPPL for obtaining information through letters and emails dated December 24, 2022 and February 17, 2023 among others, apart from telephonic communication. However, the issuer has remained non cooperative. 'The investors, lenders and all other market participants should exercise due caution with reference to the rating assigned/reviewed with the suffix 'ISSUER NOT COOPERATING' as the rating is arrived at without any management interaction and is based on best available or limited or dated information on the company. Such non co-operation by a rated entity may be a result of deterioration in its credit risk profile. These ratings with 'ISSUER NOT COOPERATING' suffix lack a forward looking component.' Detailed Rationale Despite repeated attempts to engage with the management, CRISIL Ratings failed to receive any information on either the financial performance or strategic intent of LPPL, which restricts CRISIL Ratings' ability to take a forward looking view on the entity's credit quality. CRISIL Ratings believes that rating action on LPPL is consistent with 'Assessing Information Adequacy Risk'. Based on the last available information, the ratings on bank facilities of LPPL continues to be 'CRISIL D Issuer Not Cooperating'. Incorporated in 1994, LPPL is engaged in plantation and processing of tea. On August 10, 2015, the company took over the operations of a tea estate of New Chumta Tea Co Ltd, at a purchase consideration of Rs 13.5 crores. LPPL has an annual tea production capacity of 40 lakh kg. LUNI POWER: CRISIL Keeps D Debt Rating in Not Cooperating --------------------------------------------------------- CRISIL Ratings said the rating on bank facilities of Luni Power Company Private Limited (LPCL) continues to be 'CRISIL D Issuer Not Cooperating'. Amount Facilities (INR Crore) Ratings ---------- ----------- ------- Term Loan 15 CRISIL D (Issuer Not Cooperating) CRISIL Ratings has been consistently following up with LPCL for obtaining information through letters and emails dated December 24, 2022 and February 17, 2023 among others, apart from telephonic communication. However, the issuer has remained non cooperative. 'The investors, lenders and all other market participants should exercise due caution with reference to the rating assigned/reviewed with the suffix 'ISSUER NOT COOPERATING' as the rating is arrived at without any management interaction and is based on best available or limited or dated information on the company. Such non co-operation by a rated entity may be a result of deterioration in its credit risk profile. These ratings with 'ISSUER NOT COOPERATING' suffix lack a forward looking component.' Detailed Rationale Despite repeated attempts to engage with the management, CRISIL Ratings failed to receive any information on either the financial performance or strategic intent of LPCL, which restricts CRISIL Ratings' ability to take a forward looking view on the entity's credit quality. CRISIL Ratings believes that rating action on LPCL is consistent with 'Assessing Information Adequacy Risk'. Based on the last available information, the ratings on bank facilities of LPCL continues to be 'CRISIL D Issuer Not Cooperating'. LPCL, incorporated in 2001, is setting up a small hydro-power plant under a 40-year concession contract with the Government of Himachal Pradesh on a build-own-operate-and-transfer basis. M.R. OVERSEAS: CRISIL Keeps D Debt Rating in Not Cooperating ------------------------------------------------------------ CRISIL Ratings said the rating on bank facilities of M.R. Overseas Private Limited (MROPL) continues to be 'CRISIL D Issuer Not Cooperating'. Amount Facilities (INR Crore) Ratings ---------- ----------- ------- Cash Credit 47 CRISIL D (Issuer Not Cooperating) CRISIL Ratings has been consistently following up with MROPL for obtaining information through letters and emails dated December 24, 2022 and February 17, 2023 among others, apart from telephonic communication. However, the issuer has remained non cooperative. 'The investors, lenders and all other market participants should exercise due caution with reference to the rating assigned/reviewed with the suffix 'ISSUER NOT COOPERATING' as the rating is arrived at without any management interaction and is based on best available or limited or dated information on the company. Such non co-operation by a rated entity may be a result of deterioration in its credit risk profile. These ratings with 'ISSUER NOT COOPERATING' suffix lack a forward looking component.' Detailed Rationale Despite repeated attempts to engage with the management, CRISIL Ratings failed to receive any information on either the financial performance or strategic intent of MROPL, which restricts CRISIL Ratings' ability to take a forward looking view on the entity's credit quality. CRISIL Ratings believes that rating action on MROPL is consistent with 'Assessing Information Adequacy Risk'. Based on the last available information, the ratings on bank facilities of MROPL continues to be 'CRISIL D Issuer Not Cooperating'. MROPL was originally set up as a partnership between Mr Nand Kumar Arora, Mr Rajesh Kumar Arora, Mr Sanjiv Kumar Arora and Mr Rohit Arora in 1996, and was reconstituted as a private limited company in 1998. It processes basmati rice varieties (PUSA 1121, PUSA 1509, traditional basmati, and blended rice) in the domestic and overseas markets, and has milling and sorting capacity of 8 tonne per hour (tph) and 6 tph, respectively. The plant at Delhi has Hazard Analysis and Critical Control Points (HACCP), ISO 9001:2001, and US Food and Drug Administration (USFDA) certifications. MEALITE FOODS: CRISIL Keeps D Debt Ratings in Not Cooperating ------------------------------------------------------------- CRISIL Ratings said the ratings on bank facilities of Mealite Foods Private Limited (MFPL) continue to be 'CRISIL D Issuer Not Cooperating'. Amount Facilities (INR Crore) Ratings ---------- ----------- ------- Cash Credit 5.5 CRISIL D (Issuer Not Cooperating) Term Loan 3.1 CRISIL D (Issuer Not Cooperating) CRISIL Ratings has been consistently following up with MFPL for obtaining information through letters and emails dated December 24, 2022 and February 17, 2023 among others, apart from telephonic communication. However, the issuer has remained non cooperative. 'The investors, lenders and all other market participants should exercise due caution with reference to the rating assigned/reviewed with the suffix 'ISSUER NOT COOPERATING' as the rating is arrived at without any management interaction and is based on best available or limited or dated information on the company. Such non co-operation by a rated entity may be a result of deterioration in its credit risk profile. These ratings with 'ISSUER NOT COOPERATING' suffix lack a forward looking component.' Detailed Rationale Despite repeated attempts to engage with the management, CRISIL Ratings failed to receive any information on either the financial performance or strategic intent of MFPL, which restricts CRISIL Ratings' ability to take a forward looking view on the entity's credit quality. CRISIL Ratings believes that rating action on MFPL is consistent with 'Assessing Information Adequacy Risk'. Based on the last available information, the ratings on bank facilities of MFPL continues to be 'CRISIL D Issuer Not Cooperating'. Incorporated in 2013, MFPL manufactures corn flakes, ready to eat packaged snacks such as namkeens, baked snacks, fried snacks and other related products. It has recently started its commercial operations in July 2015 and its manufacturing facilities is located at Rajkot-Gujarat. MEENAKSHI ASSOCIATES: CRISIL Keeps D Ratings in Not Cooperating --------------------------------------------------------------- CRISIL Ratings said the ratings on bank facilities of Meenakshi Associates Private Limited (MAPL) continue to be 'CRISIL D/CRISIL D Issuer Not Cooperating'. Amount Facilities (INR Crore) Ratings ---------- ----------- ------- Bank Guarantee 10 CRISIL D (Issuer Not Cooperating) Cash Credit 7 CRISIL D (Issuer Not Cooperating) Letter of Credit 5.5 CRISIL D (Issuer Not Cooperating) Term Loan 0.03 CRISIL D (Issuer Not Cooperating) CRISIL Ratings has been consistently following up with MAPL for obtaining information through letters and emails dated December 24, 2022 and February 17, 2023 among others, apart from telephonic communication. However, the issuer has remained non cooperative. 'The investors, lenders and all other market participants should exercise due caution with reference to the rating assigned/reviewed with the suffix 'ISSUER NOT COOPERATING' as the rating is arrived at without any management interaction and is based on best available or limited or dated information on the company. Such non co-operation by a rated entity may be a result of deterioration in its credit risk profile. These ratings with 'ISSUER NOT COOPERATING' suffix lack a forward looking component.' Detailed Rationale Despite repeated attempts to engage with the management, CRISIL Ratings failed to receive any information on either the financial performance or strategic intent of MAPL, which restricts CRISIL Ratings' ability to take a forward looking view on the entity's credit quality. CRISIL Ratings believes that rating action on MAPL is consistent with 'Assessing Information Adequacy Risk'. Based on the last available information, the ratings on bank facilities of MAPL continues to be 'CRISIL D/CRISIL D Issuer Not Cooperating'. Incorporated in 1985, Noida-based MAPL, promoted by Mr Ish Kumar Narang and family, fabricates pressure vessels, heat exchangers, storage tanks, and chemical gas cylinders mainly for the petroleum refining and chemical industries. MONEY2ME FINANCE: Ind-Ra Assigns BB+ Loan Rating, Outlook Stable ---------------------------------------------------------------- India Ratings and Research (Ind-Ra) has taken the following actions on rated Money2me Finance Private Limited's (MFPL) bank loans: -- INR150 mil. Bank loans* assigned with IND BB+/Stable rating; and -- INR150 mil. Bank loans* affirmed with IND BB+/Stable rating. *Yet to be issued The rating is constrained by MFPL's small scale of operations and high geographical concentration. However, the ratings are supported by the company's stable asset class (gold loans) and asset quality, along with its experienced management (over 16 years). Key Rating Drivers The company operates in the loan against gold finance segment, and had assets under management (AUM) of just INR688 million at end-December 2022 (FY22: INR704 million, FY21: INR425 million). MFPL lends an average ticket size of INR0.1 million. These are short-tenor loans with an average residual tenor of six-to-12 months; hence the disbursement momentum remains critical for loan book growth. Moreover, the company's AUM is exposed to high geographical concentration risk with all its 17 branches located in Maharashtra. Nonetheless, the low-ticket size of these loans mitigates the risk to a certain extent. The company commenced its operations at the northern part of Mumbai. MFPL is looking to expand its total presence to 40-42 branches by FY24 (FY23: 20), of which some of these will be in Gujarat, thereby gradually diversifying its geographic concentration. MFPL is in an evolution stage, and scale plays an important role in factors such as operational efficiencies, concentration risks, and consistent clear and scalable policies. Considering the existing scale of operations, the company has adequate systems and processes in place to carry out its day-to-day operations. Ind-Ra opines that a strengthened franchise and a sustainable scale-up in the AUM, along with funding diversification, while maintaining the asset quality, capitalization and liquidity are key rating monitorable. The ratings also reflect MFPL's skewed funding profile and its yet-to-be-established diversified liability profile. At end-December 2022, the company's borrowings were towards overdraft facilities and cash credit facilities from banks, which constituted around 80% of the total borrowings. Term loans from financial institutions/non-bank financial companies, non-convertible debentures, and loans from director formed around 18%, 0.7%, and 1%, respectively. The top three lenders constitute 87.7% of the total funding (excluding compulsory convertible debentures (CCDs). However, to explore a new funding avenue, the company has initiated business correspondence model with CSB Bank ('IND A'/Stable) and is planning to expand over the near-to-medium term. Diversification of the funding profile by securing new sources is critical for the company's loan book growth. At end-December 2022, the company's profitability was muted. The return on average assets reduced to 1.3% and return on equity to 6.9% in 9MFY23 (FY22: 2. 9% and 16.7%), respectively. The net interest margin improved to 12.4% in 9MFY23 (FY22: 12.41%), on back of an improvement in the yields; however, this was offset by an increase in the operating cost which stood at 9.3% at end-December 2022 (FYE22: 8.3%), as the company is investing in branches and people. MFPL's AUM per branch stood at INR41 million during 9MFY23 (FY22: INR59 million). The agency opines MFPL's operating leverage could benefit profitability over the medium term, as the operations scale further with operating expense for branch expansion rationalizing. At end-9MFY23, MFPL's adequate capital adequacy ratio improved to 21.24% (FYE22: 20.5%). The company's leverage improved to 4.0x in 9MFY23 (FY22: 4.4x) as CCDs are considered a part of equity; the management intends to cap the leverage at 4x-4.5x levels over the medium term. However, excluding CCDs as part of networth and factoring it in borrowings till the conversion takes place, the leverage stood at 5.2x at end-December 2022. The rating is supported by MFPL's improving asset quality. The company extends gold loans with a tenor of up to 12 months with bullet principal repayments, while interest accrues on a monthly basis. While MFPL's primary line of activity will remain gold financing, the company plans to diversify in other segments such as financing farmers backed by government subsidies; the company's ability to scale and manage its asset quality over the medium term remain a monitorable. The average loan-to-value ratio of the overall book was 72%-73% at end-December 2022, which is line with other gold finance non-bank finance companies. MFPL's gross non-performing assets based on 90 days past due (dpd) stood at 1.1% at end-9MFY23 (FYE22: 1.5%; FYE21: 3.8%; FYE20: 16.3%). During the auction process, the company did not incur any losses on its principal dues; however, it forgoes some of the incurred interest on the loans. The total overdue at end-December 2022 (i.e. principal and accrued interest) in terms of 1+ days past due stood at 0.7% of the overall AUM compared to 18.6 % at end-March 2020. Liquidity Indicator - Adequate: At end-December 2022, the company had a cumulative surplus of 73.4% for the softer bucket of up to one year. This is further strengthened by the total cash and cash equivalent of INR27 million and INR409 million of unutilized bank lines against three months' debt payment of INR1.30 million, considering nil inflow of advances. Rating Sensitivities Positive: A significant scale-up in the AUM while maintaining the asset quality metrics, modest leverage and healthy profitability will be positive for the ratings. A positive rating action could also result from diversification of its gold loan book into other geographies with stable asset quality on a sustainable basis. Diversifying funding mix across longer-duration instruments remains a key monitorable. Negative: A significant dilution in the tangible net worth due to significant losses, the capital adequacy ratio falling below 17% and the leverage exceeding 6x on a sustained basis; deterioration in the asset quality and profitability could lead to a negative rating action. Any challenges faced by the entity in terms of regulatory compliance could also entail a negative rating action. Company Profile MFPL was formed by acquiring a company Broadway Hire Purchase in 2016 by Nayan Kambli and his wife Gunjan Kambli, and renamed it MFPL with a focus on providing loans against gold. It is a registered as non-systemically important non-deposit taking non-bank finance company. Nayan Kambli and his wife Gunjan Kambli manage the business. Gunjan Kambli, director and product head, has an experience of over 16 years in the gold loan sector with gold financiers such as Muthoot Finance Ltd, IIFL Finance Ltd and has established field expertise. The company operates through 17 branches located across Mumbai, Thane, Palghar and Pune district with strength of 150 employees. MOUNT ZION: CRISIL Keeps D Debt Ratings in Not Cooperating ---------------------------------------------------------- CRISIL Ratings said the ratings on bank facilities of Mount Zion Medical College (MZMC) continue to be 'CRISIL D/CRISIL D Issuer Not Cooperating'. Amount Facilities (INR Crore) Ratings ---------- ----------- ------- Bank Guarantee 6.55 CRISIL D (Issuer Not Cooperating) Long Term Loan 3 CRISIL D (Issuer Not Cooperating) Long Term Loan 7.35 CRISIL D (Issuer Not Cooperating) Overdraft Facility 1.5 CRISIL D (Issuer Not Cooperating) Proposed Fund- Based Bank Limits 6.71 CRISIL D (Issuer Not Cooperating) CRISIL Ratings has been consistently following up with MZMC for obtaining information through letters and emails dated December 24, 2022 and February 28, 2023 among others, apart from telephonic communication. However, the issuer has remained non cooperative. 'The investors, lenders and all other market participants should exercise due caution with reference to the rating assigned/reviewed with the suffix 'ISSUER NOT COOPERATING' as the rating is arrived at without any management interaction and is based on best available or limited or dated information on the company. Such non co-operation by a rated entity may be a result of deterioration in its credit risk profile. These ratings with 'ISSUER NOT COOPERATING' suffix lack a forward looking component.' Detailed Rationale Despite repeated attempts to engage with the management, CRISIL Ratings failed to receive any information on either the financial performance or strategic intent of MZMC, which restricts CRISIL Ratings' ability to take a forward looking view on the entity's credit quality. CRISIL Ratings believes that rating action on MZMC is consistent with 'Assessing Information Adequacy Risk'. Based on the last available information, the ratings on bank facilities of MZMC continues to be 'CRISIL D/CRISIL D Issuer Not Cooperating'. Established in 2014 at Adoor, Kerala, by Dr. K J Abraham Kalamannil (founder-chairman of Charitable Education and Welfare Society; CEWS), MZMC operates a medical college with capacity of 100 students; first academic session was in 2014-15. Mount Zion Medical College Hospital, established in 2012, is a 300-bed, multi-speciality hospital. Both these institutes are managed by CEWS. N.S.K. BUILDERS: CRISIL Keeps D Debt Ratings in Not Cooperating --------------------------------------------------------------- CRISIL Ratings said the ratings on bank facilities of N.S.K. Builders Private Limited (NBPL) continue to be 'CRISIL D/CRISIL D Issuer Not Cooperating'. Amount Facilities (INR Crore) Ratings ---------- ----------- ------- Bank Guarantee 0.5 CRISIL D (Issuer Not Cooperating) Bank Guarantee 7.5 CRISIL D (Issuer Not Cooperating) Bank Guarantee 19 CRISIL D (Issuer Not Cooperating) Cash Credit 5 CRISIL D (Issuer Not Cooperating) Cash Credit 10 CRISIL D (Issuer Not Cooperating) Open Cash Credit 8 CRISIL D (Issuer Not Cooperating) CRISIL Ratings has been consistently following up with NBPL for obtaining information through letters and emails dated December 24, 2022 and February 17, 2023 among others, apart from telephonic communication. However, the issuer has remained non cooperative. 'The investors, lenders and all other market participants should exercise due caution with reference to the rating assigned/reviewed with the suffix 'ISSUER NOT COOPERATING' as the rating is arrived at without any management interaction and is based on best available or limited or dated information on the company. Such non co-operation by a rated entity may be a result of deterioration in its credit risk profile. These ratings with 'ISSUER NOT COOPERATING' suffix lack a forward looking component.' Detailed Rationale Despite repeated attempts to engage with the management, CRISIL Ratings failed to receive any information on either the financial performance or strategic intent of NBPL, which restricts CRISIL Ratings' ability to take a forward looking view on the entity's credit quality. CRISIL Ratings believes that rating action on NBPL is consistent with 'Assessing Information Adequacy Risk'. Based on the last available information, the ratings on bank facilities of NBPL continues to be 'CRISIL D/CRISIL D Issuer Not Cooperating'. Formed in 1996 as a partnership entity, and later incorporated as a private limited company in 2010, NBPL, promoted by Mr NSK Kalairaja and Mr NSK Karunairaja, undertakes large infrastructure projects such as roads and building construction. OYSTER EXIM: Ind-Ra Hikes Long-Term Issuer Rating to BB+ -------------------------------------------------------- India Ratings and Research (Ind-Ra) has upgraded Oyster Exim Private Limited's (OEPL) Long-Term Issuer Rating to 'IND BB+' from 'IND BB-'. The Outlook is Stable. The instrument-wise rating actions are: -- INR202.5 mil. (increased from INR172.5 mil.) Fund-based working capital limits Long-term rating upgraded/Short-term rating affirmed with IND BB+/Stable/ IND A4+ rating; and -- INR194.84 mil. (increased from INR147.5 mil.) Term loans due on June 2029 upgraded with IND BB+/Stable rating. The upgrade reflects the improvement in OEPL's financial performance and liquidity position over FY22-10MFY23. Key Rating Drivers OEPL's revenue grew to INR1,105.86 million in FY22 (FY21: INR828.33 million), led by an increase in the number of orders and higher contribution of newly added products such as dairy whitener. Furthermore, the company recorded a revenue of INR1,600 million in 10MFY23 itself. The scale of operations continued to be small. Ind-Ra expects the revenue to improve further in the medium term, driven by rising contribution from the soya segment, which commenced operations in in December 2022. Liquidity Indicator - Stretched: OEPL's liquidity position has improved due to an improvement in the utilization of fund-based working capital limits. The average maximum utilization of the fund-based limits was 95.09% during the 12 months ended January 2023. The cash flow from operations improved to INR15.20 million in FY22 (FY21: INR11.85 million) owing to favorable changes in working capital. The free cash flow remained negative but improved to INR29.34 million in FY22 (FY21: negative INR55.49 million). In FY22, the working capital cycle improved to 89 days (FY21: 100 days), mainly due to an improvement in the debtor collection period to four days ((FY21: 15) and creditor days to 14 days (21 days). The cash and cash equivalents stood at INR36.84 million at FYE22 (FYE21: INR14.68 million). The company has scheduled repayments of INR33.9 million in FY23 and INR48.9 million in FY24. OEPL does not have any capital market exposure and relies on banks and financial institutions to meet its funding requirements. OEPL's credit metrics remained modest but improved in FY22 owing to an increase in the absolute EBITDA to INR47.56 million (FY21: INR35.92 million). The interest coverage (operating EBITDA/gross interest expenses) was 1.93x in FY22 (FY21: 1.69x) and the net leverage (total adjusted net debt/operating EBITDAR) was 11.85x (12.99x). Ind-Ra expects the credit metrics to improve further in the short term, due to a likely increase in the absolute EBITDA and scheduled repayment of term loans. Furthermore, OEPL's EBITDA margin improved to a modest 5.26% in 9MFY23 (FY22: 4.3%; FY21: 4.34%) on account of the introduction of high-margin products in the product mix. The ROCE was 5.4% in FY22 (FY21: 5.1%). Ind-Ra expects the margin to remain at similar levels in FY23. The ratings are supported by the sustained high demand for dairy products and the company's widespread dealership network across 13 states in India. Rating Sensitivities Negative: A decline in the scale of operations, leading to deterioration in the overall credit metrics with interest coverage ratio reducing below 1.8x, on a sustained basis, and/or a further pressure on the liquidity position, could lead to a negative rating action. Positive: An increase in the scale of operations, along with an improvement in the overall credit metrics and liquidity position, all on a sustained basis, could lead to a positive rating action. Company Profile Incorporated in 2019, OEPL manufactures dairy products such as clarified butter, skimmed milk powder and pasteurized milk. It has a plant in Indore with a daily milk processing capacity of 2,25,000 liters. RAJESHWARI COTSPIN: CRISIL Withdraws D Rating on INR19cr Loan ------------------------------------------------------------- CRISIL Ratings has withdrawn its rating on the bank facilities of Rajeshwari Cotspin Limited (RCL) on the request of the company and after receiving no objection certificate from the bank. The rating action is in-line with CRISIL Rating's policy on withdrawal of its rating on bank loan facilities. Amount Facilities (INR Crore) Ratings ---------- ----------- ------- Bank Guarantee 1 CRISIL D/Issuer Not Cooperating (Withdrawn) Cash Credit 5 CRISIL D/Issuer Not Cooperating (Withdrawn) Cash Credit 2.5 CRISIL D/Issuer Not Cooperating (Withdrawn) Term Loan 19 CRISIL D/Issuer Not Cooperating (Withdrawn) Term Loan 15 CRISIL D/Issuer Not Cooperating (Withdrawn) CRISIL Ratings has been consistently following up with RCL for obtaining information through letters and emails dated April 29, 2022 and June 27, 2022 among others, apart from telephonic communication. However, the issuer has remained non cooperative. 'The investors, lenders and all other market participants should exercise due caution with reference to the rating assigned/reviewed with the suffix 'ISSUER NOT COOPERATING' as the rating is arrived at without any management interaction and is based on best available or limited or dated information on the company. Such non co-operation by a rated entity may be a result of deterioration in its credit risk profile. These ratings with 'ISSUER NOT COOPERATING' suffix lack a forward looking component.' Detailed Rationale Despite repeated attempts to engage with the management, CRISIL Ratings failed to receive any information on either the financial performance or strategic intent of RCL. This restricts CRISIL Ratings' ability to take a forward looking view on the credit quality of the entity. CRISIL Ratings believes that rating action on RCL is consistent with 'Assessing Information Adequacy Risk'. Based on the last available information, CRISIL Ratings has continued the ratings on the bank facilities of RCL to 'CRISIL D/CRISIL D Issuer not cooperating'. Incorporated in February 2013, and operations starting in November 2018, RCL was established for the purpose of ginning of cotton and using it captively for spinning to manufacture cotton yarn in multiple counts, which find use in products such as bedsheets, terry towels, suiting, shirting and hosiery. Mr Mahesh Patel, Mr Pravin Khunt, Mr Bhavin Patel and Mr Ramesh Patel are the promoters. SARVALOKA TEXTILES: Ind-Ra Affirms BB Long Term Issuer Rating ------------------------------------------------------------- India Ratings and Research (Ind-Ra) has affirmed Shree Sarvaloka Textiles Private Limited's (SSTPL) Long-Term Issuer Rating at 'IND BB'. The Outlook is Stable. The instrument-wise rating actions are as follows: -- INR190 mil. Fund-based facilities assigned with IND BB/Stable/ IND A4+ rating; and -- INR570 mil. (reduced from INR655 mil.) Term loan due on July 2029 affirmed with IND BB/Stable rating. Key Rating Drivers The affirmation reflects SSTPL's continued small scale of operations, with its revenue rising 87.54% to INR120.16 million in FY22 (FY21: INR64.07 million), led by an increase in job work and stitching as well as sales agency commission. In 9MFY23, SSTPL booked revenue of INR99.31 million. For FY23, Ind-Ra expects SSTPL's revenue to improve further as the company set up a cotton yarn manufacturing unit in Madurai, which commenced operations in January 2023 and was running at 30% of utilization levels as of February 2023 with full operations likely beginning from end-March. The new plant has an installed capacity of 25,536 spindles, which will provide primary raw materials (cotton yarn in the counts of 50s and 60s) for its associate concern, Paramount Textile Mills Private Limited. SSTPL sells 50%-60% of production to Paramount Textile Mills. Liquidity Indicator - Stretched: SSTPL's net working capital cycle stood negative at 48 days in FY22 (FY21: negative 49 days), due to a decrease in creditor days to 48 days (49 days). Ind-Ra expects the net working capital cycle to deteriorate in FY23 and FY24, due to the full-fledged operations of the company's spinning mill which will require higher inventory. The cash flow from operations declined to negative INR46.5 million in FY22 (FY21: INR34.39 million), due to unfavorable changes in the working capital. The cash and cash equivalents stood at INR152.11 million at FYE22 (FYE21: INR11.82 million). SSTPL has scheduled debt repayments of INR48 million and INR78 million for FY23 and FY24, respectively. SSTPL does not have any capital market exposure and relies only on banks and financial institutions to meet its funding requirements. SSTPL's gross interest coverage (operating EBITDA/gross interest expense) stood at 49.95x in FY22 (FY21: no interest cost) and the net leverage (total adjusted net debt/operating EBITDAR) reduced to negative 1.43x in FY22 (FY21: negative 0.17x), due to an increase in the cash and cash equivalents to INR152.11 million (INR11.82 million). However, Ind-Ra expects SSTPL's credit metrics to weaken over the medium term, due to the company availing a term loan for its new spinning mill project, which entailed a total capex of around INR870 million. SSTPL funded the project mainly through secured loans worth INR570 million, equity of INR150 million of and unsecured loans worth INR150 million. The company has also tied up for a cash credit limit of INR190 million. However, the ratings are supported by SSTPL's healthy EBITDA margins, which, however, declined to 30.76% in FY22 (FY21: 48.42%) with a return on capital employed of 21.2% in FY22 (FY21: 126.5%). During 9MFY22, SSTPL achieved EBITDA margins of 26%. Ind-Ra expects the EBITDA margin to decline in FY23 and FY24 due to an increase in the cost of goods sold and other expenses post the commencement of its manufacturing division. The ratings derive comfort from the corporate guarantee given by Paramount Textile Mills and Shree Skanda Investments. The ratings factor in the operational linkages between the entities, and common promoters and chief financial officer. The ratings are also supported by the promoters' experience of 15 years in the textiles industry. Rating Sensitivities Negative: Any delays in achieving stability in the operating performance of the new spinning mill, affecting the company's debt serviceability, along with the weakening of the credit metrics, on a sustained basis, can lead to a negative rating action. Positive: The achievement of stable operating profitability with the net leverage falling below 5x along with an improvement in liquidity, on a sustained basis, could lead to a positive rating action. Company Profile SSTPL was incorporated in 2019 in Madurai as a commission agent for its associate concern and also involved in job work such as stitching and sale of indigenous cloths. SSTPL has set up a new spinning mill unit in Madurai with a capacity of 25,500 spindles. SCAN ENERGY: CRISIL Withdraws D Rating on INR45.83cr Loan --------------------------------------------------------- Due to inadequate information, CRISIL Ratings, in line with SEBI guidelines, had migrated the rating of Scan Energy and Power Limited (SEPL) to 'CRISIL D /CRISIL D Issuer not cooperating'. CRISIL Ratings has withdrawn its rating on bank facility of SEPL following a request from the company and on receipt of a 'no dues certificate' from the banker. Consequently, CRISIL Ratings is migrating the ratings on bank facilities of SEPL from 'CRISIL D/CRISIL D/Issuer Not Cooperating to 'CRISIL D/CRISIL D'. The rating action is in line with CRISIL Ratings' policy on withdrawal of bank loan ratings. Amount Facilities (INR Crore) Ratings ---------- ----------- ------- Cash Credit 20 CRISIL D (Migrated from 'CRISIL D ISSUER NOT COOPERATING'; Rating Withdrawn) Cash Credit 24 CRISIL D (Migrated from 'CRISIL D ISSUER NOT COOPERATING'; Rating Withdrawn) Cash Credit 15 CRISIL D (Migrated from 'CRISIL D ISSUER NOT COOPERATING'; Rating Withdrawn) Letter of Credit 7 CRISIL D (Migrated from 'CRISIL D ISSUER NOT COOPERATING'; Rating Withdrawn) Long Term Loan 45.83 CRISIL D (Migrated from 'CRISIL D ISSUER NOT COOPERATING'; Rating Withdrawn) Long Term Loan 26.83 CRISIL D (Migrated from 'CRISIL D ISSUER NOT COOPERATING'; Rating Withdrawn) Long Term Loan 8.17 CRISIL D (Migrated from 'CRISIL D ISSUER NOT COOPERATING'; Rating Withdrawn) SEPL, part of the Scan group promoted by Mr G S Agarwal and his family, was incorporated in 2007. The company has set up a steel billet and thermo-mechanically treated bar manufacturing unit with capacities of 450 tonne per day (tpd) and 500 tpd, respectively in the Mahboobnagar district of Telangana, around 60 kilometre from Hyderabad. SOLVENT EXTRACTION: Ind-Ra Gives BB- Issuer Rating, Outlook Stable ------------------------------------------------------------------ India Ratings and Research (Ind-Ra) has assigned Darshana Solvent Extraction Private Limited (DSEPL) a Long-Term Issuer Rating of 'IND BB-'. The Outlook is Stable. The instrument-wise rating actions are: -- INR400 mil. Working capital limits assigned with IND BB-/ Stable/IND A4+ rating; and -- INR320 mil. Term loan due on January 2029 assigned with IND BB-/Stable rating. Key Rating Drivers The ratings reflect DSEPL's nascent operating track record in extracting soya bean oil. The company has recently set up a manufacturing unit for extracting soya bean oil and commenced operations only from December 2022. Ind-Ra expects the scale of operations to be small in FY23 and the revenue to grow from FY24, as the latter will be the first full year of operations. In 2MFY23, DSEPL booked revenue of INR750 million. In FY23, the management expects to achieve revenue of around INR1,200 million. The ratings reflect Ind-Ra's expectation of modest EBITDA margins for the company in the range of 1.5-2.5%. The management expects EBITDA to be positive by end-FY23. Ind-Ra expects EBITDA margin to improve in FY24 on account of improved operating leverage, but will remain modest because of competition in the industry. The ratings also reflect Ind-Ra's expectation modest credit metrics for DSEPL in FY23 and FY24. DSEPL has taken a term loan of INR325.3 million for which principal repayments will start from July 2023. Furthermore, DSEPL has availed a fund-based limit of INR200 million. Liquidity Indicator - Stretched: The manufacturing unit was set up at a total cost of INR600 million (term loan: INR325.3 million, promoter's contribution: equity of INR180 million and unsecured loans of INR100 million). The company has scheduled debt repayments of INR36 million in FY24 and INR60 million in FY25, which are likely to be met through internal accruals of the company. Furthermore, DESPL does not have any capital market exposure and relies on a single bank to meet its funding requirements. The ratings however are supported by the promoter's experience of more than four decades in trading food grains. This has facilitated the company to establish strong relationships with suppliers and customers. Rating Sensitivities Negative: A decline in the scale of operations, leading to deterioration in the overall credit metrics and/or pressure on the liquidity position on a sustained basis, could lead to a negative rating action. Positive: Substantial increase in the scale of operations, along with an improvement in the overall credit metrics with the net leverage below 4.5x and an improvement in liquidity profile, on a sustained basis, could lead to a positive rating action. Company Profile Incorporated in July 2021, DSEPL is engaged in the extraction of crude oil from soya bean seeds. Its 500 metric tonnes per day manufacturing plant is located at Solapur district Maharashtra. SUPER INFRATECH: CRISIL Keeps D Debt Ratings in Not Cooperating --------------------------------------------------------------- CRISIL Ratings said the ratings on bank facilities of Super Infratech Private Limited (SIPL) continue to be 'CRISIL D/CRISIL D Issuer Not Cooperating'. Amount Facilities (INR Crore) Ratings ---------- ----------- ------- Bank Guarantee 8.74 CRISIL D (Issuer Not Cooperating) Bill Discounting 4.9 CRISIL D (Issuer Not Cooperating) Cash Credit 1.9 CRISIL D (Issuer Not Cooperating) Term Loan 0.46 CRISIL D (Issuer Not Cooperating) CRISIL Ratings has been consistently following up with SIPL for obtaining information through letters and emails dated December 24, 2022 and February 17, 2023 among others, apart from telephonic communication. However, the issuer has remained non cooperative. 'The investors, lenders and all other market participants should exercise due caution with reference to the rating assigned/reviewed with the suffix 'ISSUER NOT COOPERATING' as the rating is arrived at without any management interaction and is based on best available or limited or dated information on the company. Such non co-operation by a rated entity may be a result of deterioration in its credit risk profile. These ratings with 'ISSUER NOT COOPERATING' suffix lack a forward looking component.' Detailed Rationale Despite repeated attempts to engage with the management, CRISIL Ratings failed to receive any information on either the financial performance or strategic intent of SIPL, which restricts CRISIL Ratings' ability to take a forward looking view on the entity's credit quality. CRISIL Ratings believes that rating action on SIPL is consistent with 'Assessing Information Adequacy Risk'. Based on the last available information, the ratings on bank facilities of SIPL continues to be 'CRISIL D/CRISIL D Issuer Not Cooperating'. Incorporated in 2001, SIPL is promoted by Mr Sujit Bardole and his wife. It is engaged in civil construction for state and central governments. The company develops and maintains roads. SURBHI SATCOM: Ind-Ra Cuts Long Term Issuer Rating to BB- --------------------------------------------------------- India Ratings and Research (Ind-Ra) has downgraded Surbhi Satcom Private Limited's (SSPL) Long-Term Issuer Rating to 'IND BB-' from 'IND BB'. The Outlook is Stable. The instrument-wise rating actions are given below: -- INR630 mil. (reduced from INR644.84 mil.) Term loan due on September 2029 downgraded with IND BB-/Stable rating; -- INR94.84 mil. Proposed term loan assigned with IND BB-/Stable rating; -- INR140 mil. (reduced from INR150 mil.) Fund-based working capital limits Long-term rating downgraded and short-term rating affirmed with IND BB-/Stable/IND A4+ rating; and -- INR130 mil. Proposed fund-based working capital limits assigned with IND BB-/Stable/IND A4+ rating. The downgrade reflects the delay in the commencement of operations at SSPL's unit-II and the cancellation of the company's agreement with Samsung India Electronics Private Limited (SIEPL). Key Rating Drivers SSPL's unit-II was scheduled to start operations in July 2022; however, the commencement of the operations was delayed to April 2023, due to restrictions imposed by the pollution control board in specific areas of Noida and on all manufacturing units there and the escalation in building material prices. Furthermore, SSPL's agreement with SIEPL for a collaboration for assembling specific models of mobile phones in its under-construction facility in Noida, Uttar Pradesh, has been cancelled owing to the escalation in the project cost and a shift in the company's focus to manufacturing telecom products such as routers and gigabit passive optical network (GPON) under the government's production-linked incentive scheme. The ratings reflect SSPL's continued small scale of operations, with its revenue rising to INR781.29 million in FY22 (FY21: INR561.57 million), led by the normalization of business activities post COVID-19 and an increase in demand for electronic products. During 10MFY23, the company booked revenue of INR620 million. As of January 2023, SSPL had an outstanding order book of INR400 million for telecom products, which will be produced in the new unit. The new unit will start operations from April 1, 2023. Ind-Ra expects the revenue to remain stable in FY23 and increase on a yoy basis from FY24, led by the commencement of business operations at the new unit. The ratings continue to factor in SSPL's modest EBITDA margins due to intense competition in the industry. The margin rose to 8.93% in FY22 (FY21: 8.19%), with the absolute EBITDA rising to INR69.75 million (INR46.02 million), due to a decline in raw material costs. The return on capital employed was 3.7% in FY22 (FY21:0.7%). During 7MFY23, the company recorded an EBITDA margin of 5%, with absolute EBITDA of INR17 million. Ind-Ra expects the margin to remain at the similar levels in FY23 and improve in FY24, due to the addition of high-margin products such as routers and GPON to the company's product portfolio. The ratings further reflect SSPL's weak credit metrics due to high debt levels. The gross Interest coverage (operating EBITDA/gross interest expenses) improved to 3.40x in FY22 (FY21: 2.57x) due to the improvement in absolute EBITDA. The net leverage (total adjusted net debt/operating EBITDAR) deteriorated slightly to 11.11x (FY21:10.93x), due to an increase in total debt (FY22: INR514.99 million; FY21: INR155.40 million) and further increase in term loan to INR100 million for its unit-II and working capital enhancement will deteriorate the leverage in the near term. Ind-Ra expects the credit metrics to weaken in FY23 and FY24 post the commencement of the new unit in April 2023 as the interest cost will not be capitalized and total debt will increase. As of December 2022, the total cost of setting up the unit-II stood at INR1,097 million, and the company had incurred capex of INR921.20 million, which was funded through long-term debt of INR442 million, unsecured loans by promoters of INR232.6 million, equity infusion of INR156 million and the remaining through internal accruals. Liquidity Indicator - Stretched: SSPL's average maximum utilization of the fund-based limits was 91.14% during the 12 months ended January 2023. The cash flow from operations turned negative INR63.91 million in FY22 (FY21: INR42.11 million) due to unfavorable changes in the working capital. The free cash flow remained negative at INR320.14 million (FY21: negative INR112.76 million) owing to the high capital expenditure incurred for setting up the company's manufacturing unit. The net working capital cycle remained elongated and increased slightly to 110 days in FY22 (FY21: 107 days), mainly on account of an increase in inventory days to 160 days (142 days). The cash and cash equivalents remained low at INR1.21 million at FYE22 (FYE21: INR0.92 million). SSPL does not have any capital market exposure and relies on banks and financial institutions to meet its funding requirements. SSPL has repayment obligation of INR54.30 million and INR136 million in FY23 and FY24, respectively. However, the ratings are supported by the promoters' experience of nearly three decades in manufacturing and trading in the telecom and digital equipment industries, leading to established relationships with customers as well as suppliers. Rating Sensitivities Negative: Any delay in the commencement of operations of the unit-II and achieving stability in the operating performance after the commencement, or lower-than-expected revenue, thereby affecting the company's debt servicing ability, could lead to a negative rating action. Positive: The timely commencement of operations and ongoing capex, an increase in the scale of operations and the subsequent achievement of a stable operating profitability could lead to a positive rating action. Company Profile SSPL, a part of the Surbhi group, was incorporated in 1981. The company's existing unit (D-23) in in Noida, India, imports, assembles and trades in telecommunication and cable television products and is also engaged in original equipment manufacturing. It has a capacity of 15 million printed circuit boards per month. The new unit (Plot no-4) in in Noida is under construction. It will assemble telecom products such as routers and GPON. VIKRANT FORGE: Ind-Ra Hikes Long Term Issuer Rating to B+ --------------------------------------------------------- India Ratings and Research (Ind-Ra) has upgraded Vikrant Forge Private Limited's (VFPL) Long-Term Issuer Rating to 'IND B+' from 'IND D (ISSUER NOT COOPERATING)'. The Outlook is Stable. The instrument-wise rating actions are: -- INR236.32 mil. (increased from INR156.54 mil.) Term loa due on September 2028 upgraded with IND B+/Stable rating; -- INR90 mil. (reduced from INR400 mil.) Fund-based working capital limit upgraded with IND B+/Stable rating; and -- INR80 mil. (reduced from INR100 mil.) Non-fund-based limit upgraded with IND A4 rating. The upgrade reflects VFPL's satisfactory debt servicing on bank facilities in the 90 days ended January 2023. Key Rating Drivers Liquidity Indicator - Poor: VFPL has been successfully serving its debt repayments over the 90 days ended January 2023 due to the improvement in liquidity. Ind-Ra expects the cash flow from operations to turn positive in FY23 due to an improvement in the EBITDA on increased order execution. VFPL's cash flow from operations and the free cash flow turned negative at INR52.2 million (FY21: INR4.5 million) and INR52.80 million in FY22 (INR4.40 million), respectively, due to unfavorable changes in working capital. The elongated net working capital cycle deteriorated further to 161 days in FY22 (FY21: 134 days) due to a proportionately large increase in inventory days to 191 (105) in comparison with the rise in the creditor days to 124 from 61. The average maximum utilization of the fund-based limits was 95.24% and that of the non-fund-based limits was 28.3% during the 12 months ended January 2023. VFPL does not have any capital market exposure and relies on banks and financial institutions to meet its funding requirements. The cash and cash equivalents stood at INR4.6 million at FYE22 (FYE21: INR0.9 million). The rating reflects VFPL's continued small scale of operations, despite an improvement in the revenue to INR539.20 million in FY22 (FY21: INR396.4 million), due to the normalization of COVID impact. In 9MFY23, VFPL achieved a revenue of INR510.08 million and had an order book of INR406 million at end-December 2022, to be executed by July 2023. In FY23 and FY24, Ind-Ra expects the revenue to increase yoy due to the improved orders in hand from existing customers. The ratings further reflect VFPL's moderate credit metrics with a gross interest coverage (operating EBITDA/gross interest expense) of 2.48x in FY22 (FY21: 0.47x) and the net financial leverage (adjusted net debt/operating EBITDA) of 5.63x (25.92x) due to an improvement in the absolute EBITDA (FY22: INR136.7 million; FY21: INR24.2 million). In FY23 and FY24, Ind-Ra expects the credit metrics to improve further yoy, due to a further improved absolute EBITDA coupled with the stable/reduced interest expense due to the repayments of term loan. The ratings also reflect VFPL's healthy EBITDA margin that improved to 25.35% in FY22 (FY21: 6.10%) due to a change in its product mix as the company started focusing on high-margin, customized, ready-to-use products for its particular customer. The return on capital employed improved to 28% in FY22 (FY21: 1.4%). In FY24, Ind-Ra expects the EBITDA margin to remain healthy. The ratings are supported by VFPL's promoters' over three decades of experience in the forging industry. This has facilitated the company to establish strong relationships with customers as well as suppliers. Rating Sensitivities Negative: A decline in the scale of operations, leading to deterioration in the overall credit metrics and/or further pressure on the liquidity position, could lead to negative rating action. Positive: An increase in the scale of operations, along with an improvement in the overall credit metrics with the net leverage reducing below 4.5x with an improvement in the liquidity profile, all on a sustained basis, could lead to a positive rating action. Company Profile VFPL was incorporated on November 25, 1985 and manufactures industrial forgings at its manufacturing facility at Dankuni in Hooghly district in West Bengal. The operation of the company also includes machined and finish machining. The company has the installed capacity of 1800MT. The company serves the domestic and international customers. ===================== N E W Z E A L A N D ===================== ANNECY HOLDING: Court to Hear Wind-Up Petition on April 21 ---------------------------------------------------------- A petition to wind up the operations of Annecy Holding Limited will be heard before the High Court at Auckland on April 21, 2023, at 10:45 a.m. Wenjun (Renee) Ji filed the petition against the company on Feb. 3, 2023. The Petitioner's solicitor is: Richard Connell c/- Connell & Connell Lawyers Level 4, 70 Shortland Street Central Auckland Auckland 1010 BAYSIDE DESIGNER: Goes Into Liquidation --------------------------------------- Stuff.co.nz reports that a fifth building company linked to Auckland-based Msonti has gone into liquidation, and a sixth is no longer answering the number it lists on its website. Bayside Designer Homes was placed in liquidation on March 6, and the first liquidators' report estimated over NZD1.9 million was owed to unsecured trade creditors. Bayside describes itself online as an end-to-end design and build consultancy, based in and operated around Auckland. Other recent liquidations linked to Msonti Ltd included JacksCo, JacksCo Civil, Jacksco Holdings and Auckland Hardscapes and Kerbing (AKH), Stuff discloses. All have gone into liquidation in roughly the last month-and-a-half. According to Stuff, liquidator Steven Khov of Khov Jones said Bayside employed 13 staff, and the company left nine builds uncompleted. "There were a number of contractors engaged by the company also," Stuff quotes Mr. Khov as saying. "The company became unsustainable which resulted in profitability and cashflow becoming impacted which meant it was no longer viable." Among the list of creditors was ex-TV presenter Ingrid Hipkiss and partner Jack Tarrant. Bayside Designer Homes is roughly a third owned by Msonti, which also owned 56% of JacksCo Holdings Ltd - the holding company that owned JacksCo, JacksCo Civil, and Auckland Hardscapes and Kerbing Ltd (AKH), Stuff discloses. All of the companies have links to Simon Jacks, either through Msonti, or because Mr. Jacks was a director or held a managerial position within the companies, Stuff says. Mr. Jacks is the sole director of Msonti Holdings, which itself is solely owned by Msonti. Msonti in turn is owned by a lawyer-held company, Hauraki Nominees. Stuff adds that Hauraki Nominees' shareholders, Linda Fox and Matthew Carson of Carson Fox Legal in Auckland, confirmed the firm did work with Mr. Jacks, but could not comment for client confidentiality reasons. COLD RIVER: Creditors' Proofs of Debt Due on April 13 ----------------------------------------------------- Creditors of Cold River Building Limited are required to file their proofs of debt by April 13, 2023, to be included in the company's dividend distribution. The company commenced wind-up proceedings on March 10, 2023. The company's liquidators are: Brenton Hunt PO Box 13400 City East Christchurch 8141 MCLACHLAN DECORATORS: Creditors' Proofs of Debt Due on April 13 --------------------------------------------------------------- Creditors of Mclachlan Decorators and Plaster Limited are required to file their proofs of debt by April 13, 2023, to be included in the company's dividend distribution. The company commenced wind-up proceedings on March 13, 2023. The company's liquidators are: Khov Jones Limited PO Box 302261 North Harbour Auckland 0751 RITZ ENTERPRISES: Court to Hear Wind-Up Petition on May 5 --------------------------------------------------------- A petition to wind up the operations of Ritz Enterprises Limited will be heard before the High Court at Auckland on May 5, 2023, at 10:00 a.m. Taharoto Motels Limited filed the petition against the company on Feb. 24, 2023 The Petitioner's solicitor is: Stanton Accountants Suite 2, 20 Northcroft Street Takapuna Auckland 0622 SWEETY TRADING: Creditors' Proofs of Debt Due on April 15 --------------------------------------------------------- Creditors of Sweety Trading Limited and Lifeline Agecare Limited are required to file their proofs of debt by April 15, 2023, to be included in the company's dividend distribution. The company commenced wind-up proceedings on March 13, 2023. The company's liquidators are: Pritesh Patel PO Box 23296 Manukau City Auckland 2241 ================= S I N G A P O R E ================= CARTE BLANCHE: Court to Hear Wind-Up Petition on March 31 --------------------------------------------------------- A petition to wind up the operations of Carte Blanche Riau Holdings Pte Ltd will be heard before the High Court of Singapore on March 31, 2023, at 10:00 a.m. Dentons Rodyk & Davidson LLP filed the petition against the company on March 9, 2023. The Petitioner's solicitors are: Dentons Rodyk & Davidson LLP 80 Raffles Place #33-00 UOB Plaza 1 Singapore 048624 GSK GLOBAL: First Creditors' Meeting Set for April 3 ---------------------------------------------------- A first meeting of the creditors in the proceedings of GSK Global Pte Ltd (n.k.a. GS Advisory Pte Ltd) will be held on April 3, 2023, at 10:00 a.m. via Zoom. The company's liquidators are: Lau Chin Huat Yeo Boon Keong c/o Technic Inter-Asia Pte Ltd 50 Havelock Road #02-767 Singapore 160050 JUNTOSTARC PTE: EA Consulting Appointed as Provisional Liquidators ------------------------------------------------------------------ Mr. Saw Meng Tee and Ms. Lim Bee Lian of EA Consulting on March 10, 2023, were appointed as provisional liquidators of Juntostarc Pte Ltd. The provisional liquidators may reached at: EA Consulting Pte Ltd (a subsidiary of EisnerAmper PAC) 1 North Bridge Road #23-05 High Street Centre Singapore 179094 PEAK INVESTMENTS: Creditors' Proofs of Debt Due on April 17 ----------------------------------------------------------- Creditors of Peak Investments Pte. Ltd. are required to file their proofs of debt by April 17, 2023, to be included in the company's dividend distribution. The company commenced wind-up proceedings on March 15, 2023. The company's liquidators are: Leong Hon Mun Peter Gary Loh Weng Fatt Seah Roh Lin c/o BDO Advisory Pte. Ltd. 600 North Bridge Road #23-01 Parkview Square Singapore 188778 TIGER ROAD: First Creditors' Meeting Set for April 3 ---------------------------------------------------- A first meeting of the creditors in the proceedings of Tiger Road Pte Ltd will be held on April 3, 2023, at 5:00 p.m. via Zoom. The company's liquidators are: Lau Chin Huat Yeo Boon Keong c/o Technic Inter-Asia Pte Ltd 50 Havelock Road #02-767 Singapore 160050 ********* 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 2023. All rights reserved. ISSN: 1520-9482. 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