/raid1/www/Hosts/bankrupt/TCRAP

/raid1/www/Hosts/bankrupt/TCRAP_Public/110103.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, January 3, 2011, Vol. 14, No. 1 Headlines A U S T R A L I A COLORADO GROUP: PwC Fears Group May Default on its AU$387MM Loan C H I N A COASTAL GREENLAND: Moody's Downgrades Corp. Family Rating to 'B3' H O N G K O N G APEX JOY: Creditors' Proofs of Debt Due January 17 CE INNOVATIONS: Creditors' Proofs of Debt Due January 28 CHANNEL MASTER: John James Toohey Steps Down as Liquidator CSA ABSOLUTE: John James Toohey Steps Down as Liquidator DE CHANG: Members' Final Meeting Set for February 1 DVN INTERNATIONAL: Victor Danilkin Steps Down as Liquidator GENMAY INDUSTRIES: John James Toohey Steps Down as Liquidator GLOBAL MARCH: John James Toohey Steps Down as Liquidator GOLAN LIMITED: Contributories to Get $368,350/Share Dividend HARVEST FIELD: John James Toohey Steps Down as Liquidator LUNG HING: Court to Hear Wind-Up Petition on January 26 M.F. PRINTING: John James Toohey Steps Down as Liquidator MERCURIES-JEANTEX HOLDINGS: Toohey Steps Down as Liquidator MINGWAY COMPANY: Creditors' Proofs of Debt Due January 31 MOULIN HOLDINGS: Creditors Get 7% Recovery on Claims XELO PLC: S&P Withdraws 'CCC-' Rating on Tranche B Notes I N D I A ANJALEE GRANITES: CRISIL Assigns 'B' Rating to INR181.6MM LT Loan BHANDARY POWERLINES: ICRA Assigns 'LB-' Rating to INR10.02cr Loan CCS INFOTECH: CRISIL Reaffirms 'BB+' Rating on INR100MM Loan DSF GRAND: ICRA Reaffirms 'LBB' Rating on INR6.8cr Term Loan EMKAY AUTOMOBILE: CRISIL Places 'B+' Rating on INR54.7MM LT Loans GANGES FORD: CRISIL Assigns 'BB-' Rating to INR30.8MM Term Loan GOEL INT'L: CRISIL Assigns 'B' Rating to INR211.3MM Term Loan HMA AGRO: ICRA Assigns 'LC' Rating to INR20.6cr Fund Based Debts INDUSTRIAL SAFETY: CRISIL Assigns 'P4+' Rating on INR150MM Debt MEDALL HEALTHCARE: ICRA Assigns 'LBB+' Rating to INR75cr Term Loan MEP COTTON: ICRA Assigns 'LC' Rating to INR44.5cr Term Loans OSWAL PUMPS: CRISIL Reaffirms 'BB+' Rating on INR25MM Term Loan RAJIT PAINTS: CRISIL Downgrades Rating on INR14.7MM Loan to 'D' SHREEJIKRUPA BUILDCON: ICRA Puts 'LBB' Rating on INR7cr Cash Debt STANDARD CORP: CRISIL Assigns 'B' Rating to INR200 Mil. Term Loan SUNGRO SEEDS: ICRA Downgrades Rating on INR10cr Loan to 'LBB+' V R COATINGS: CRISIL Places 'BB' Rating on INR30MM Long Term Loan VATIKA LIMITED: ICRA Places 'LBB' Rating on INR193.34cr Bank Debt VENKATESWARA ELECTRICAL: CRISIL Puts 'BB-' Rating to LT Loan J A P A N JAPAN AIRLINES: Privately Places Stocks With Top Executives N E W Z E A L A N D CHRISTCHURCH BUS: Fined NZ$783,000 For Poor Performance MERCER GROUP: Westpac Extends Banking Facilities to December 2011 SIMPLYINSURANCE NEW: S&P Raises Insurer Strength Rating to 'BB' S I N G A P O R E ARTICON CONSTRUCTION: Creditors' Proofs of Debt Due January 14 BUILD TRADE: Creditors Get 2.03712% Recovery on Claims FRASER THERMAL: Creditors to Get 100% Recovery on Claims JOHN DEERE: Creditors' Proofs of Debt Due January 31 MULTI-BONDER TRADING: Creditors Get 88.35644% Recovery on Claims SILIJAN PTE: Creditors Get 91.5464% Recovery on Claims SOMERSET (VIETNAM): Creditors' Proofs of Debt Due January 31 TING SHEAN: Court to Hear Wind-Up Petition January 14 ULTRAPOLIS 3000: Court to Hear Wind-Up Petition January 14 X X X X X X X X * S&P Raises Ratings on Nine Asia-Pacific CDO Tranches - - - - - ================= A U S T R A L I A ================= COLORADO GROUP: PwC Fears Group May Default on its AU$387MM Loan ---------------------------------------------------------------- Blair Speedy and Tracy Lee at The Australian report that Colorado Group is at risk of defaulting on its loans. The private equity owners of the group have also been forced to reassure a syndicate of lenders about its financial position, The Australian says. Financial accounts for Colorado Group obtained by The Australian reveal that auditor PricewaterhouseCoopers harbors significant fears for the group as a "going concern". The Australian relates PricewaterhouseCoopers warned that poor performance could result in Colorado's lenders demanding it repay AU$387 million under the terms of its loan agreements. "The instability in the retail environment raises significant risk that the group may breach financial covenant thresholds under its financing agreements within the next 12 months," the auditor said, according to The Australian. The Australian reports that PWC said the company, which is owned by private equity firm Affinity Capital, had experienced "challenging trading conditions over the past two years as a result of the economic instability associated with the global financial crisis and the consequential impact on consumer confidence". Deep discounting within the fashion sector was also hurting returns, PWC said in its report, The Australian adds. The Australian says Colorado reported a 2.3% fall in sales revenue to AU$465.2 million for the 12 months to the end of July, while debt restructuring dragged the bottom line to a loss of AU$70.7 million. Colorado Group -- http://www.coloradogroup.com.au/-- is a leading footwear and apparel retailer and wholesaler with more than 430 stores in Australia and New Zealand operating under the divisions of Colorado, Mathers, Williams, diana ferrari, Jag, and Pairs. ========= C H I N A ========= COASTAL GREENLAND: Moody's Downgrades Corp. Family Rating to 'B3' ----------------------------------------------------------------- Moody's Investors Service has downgraded to B3 from B2 its corporate family rating on Coastal Greenland Limited. Moody's has also downgraded CGL's senior unsecured bond rating to Caa1 from B3. The outlook for both ratings is stable. Ratings Rationale "The downgrade reflects Moody's expectation that CGL's financial and operating profiles will continue to show weaknesses over the next couple of years, when the property market and the bank credit environment in China will be more challenging," says Kaven Tsang, a Moody's AVP Analyst. "CGL's EBITDA margin will likely remain volatile, and although the EBITDA margin should recover to around 20% after a deficit in 1H FY2010, it will still be among the weakest in its peer group," says Tsang. "In addition, CGL's small scale and high debt leverage with adjusted debt/capitalization around 64% in 1H FY2010 will expose it to higher refinancing risk in 2011 when bank credit tightens," says Tsang. "The company's debt servicing ability will remain also on the weak side. Even after EBITDA margin improves, Moody's expects CGL's interest coverage -- EBITDA/interest -- will still be at around 2x in the next 1-2 years," says Tsang. On the other hand, CGL's B3 corporate family rating reflects the company's long operating history through a number of real estate cycles, as well as its fairly diversified geographic coverage in China. CGL's senior unsecured bond rating is notched down to Caa1, reflecting legal subordination and structural subordination risk. The ratio of secured and subsidiary debt to total assets stood at 28% at September 2010 and will remain at around 30% for the next year or two, as the company will rely predominantly on onshore borrowings at the PRC subsidiary/project level to fund development. The stable outlook reflects CGL's near term liquidity, which can cover its short term obligations. The ratings could be pressured downward if CGL's liquidity -- cash on hand falling below RMB1 billion -- were to decline, either because of declining contracted sales, tighter bank credit, or increased land acquisitions. Upward pressure could be limited over the near term. However, it could rise over the medium term if CGL can (1) enhance its profit margins and debt service coverage, such that gross profit margin improves to 30-35% and EBITDA interest coverage rises above 2- 2.5x, and (2) maintain adequate balance sheet liquidity. Moody's last rating action on CGL took place on May 7, 2009, when Moody's downgraded the company's corporate family rating to B2 from B1 and senior unsecured ratings to B3 from B2 with a negative outlook. Coastal Greenland Ltd is a Chinese property developer focusing on residential and commercial property development. Established in 1990, it has been operating in China's property market for over 20 years and has fairly diversified land banks located in six major economic areas. Listed on the Stock Exchange of Hong Kong in 1997, it is majority-owned by Coastal International Holdings Limited (36.6%), a private company held by the senior management team, and Shenzhen Investment Limited (22.6%). ================ H O N G K O N G ================ APEX JOY: Creditors' Proofs of Debt Due January 17 -------------------------------------------------- Creditors of Apex Joy Limited, which is in members' voluntary liquidation, are required to file their proofs of debt by Jan. 17, 2011, to be included in the company's dividend distribution. The company commenced wind-up proceedings on December 28, 2010. The company's liquidator is: Hassan Nurulah Rooms 1001-03, 10/F Manulife Provident Funds Place 345 Nathan Road Kowloon, Hong Kong CE INNOVATIONS: Creditors' Proofs of Debt Due January 28 -------------------------------------------------------- Creditors of CE Innovations Limited, which is in members' voluntary liquidation, are required to file their proofs of debt by January 28, 2011, to be included in the company's dividend distribution. The company commenced wind-up proceedings on December 20, 2010. The company's liquidators are: Wong Tak Man Stephen Osman Mohammed Arab 29/F, Caroline Centre Lee Gardens Two 28 Yun Ping Road Hong Kong CHANNEL MASTER: John James Toohey Steps Down as Liquidator ---------------------------------------------------------- John James Toohey stepped down as liquidator of Channel Master Asia Limited on December 6, 2010. CSA ABSOLUTE: John James Toohey Steps Down as Liquidator -------------------------------------------------------- John James Toohey stepped down as liquidator of CSA Absolute Return Fund Limited on December 6, 2010. DE CHANG: Members' Final Meeting Set for February 1 --------------------------------------------------- Members of De Chang Parts and Services Limited will hold their final meeting on February 1, 2011, at 9:00 a.m., at 12 Science Park East Avenue, 6/F, Hong Kong Science Park, Shatin, New Territories, in Hong Kong. At the meeting, Yip Chee Lan and Regina Tam Lai Ha, the company's liquidators, will give a report on the company's wind-up proceedings and property disposal. DVN INTERNATIONAL: Victor Danilkin Steps Down as Liquidator ----------------------------------------------------------- Victor Danilkin stepped down as liquidator of DVN International Investment Limited on December 31, 2010. GENMAY INDUSTRIES: John James Toohey Steps Down as Liquidator ------------------------------------------------------------- John James Toohey stepped down as liquidator of Genmay Industries Limited on December 6, 2010. GLOBAL MARCH: John James Toohey Steps Down as Liquidator -------------------------------------------------------- John James Toohey stepped down as liquidator of Global March Limited on December 6, 2010. GOLAN LIMITED: Contributories to Get $368,350/Share Dividend ------------------------------------------------------------ Golan Limited, which is in voluntary liquidation, will pay first and final dividend to its contributories on January 5, 2011. The company will pay $368,350 per share. The company's acting official receiver and liquidator is: Lee Mei Yee May Official Receiver's Office 10/F, Queensway Government Offices 66 Queensway Hong Kong HARVEST FIELD: John James Toohey Steps Down as Liquidator --------------------------------------------------------- John James Toohey stepped down as liquidator of Harvest Field Development Limited on December 6, 2010. LUNG HING: Court to Hear Wind-Up Petition on January 26 ------------------------------------------------------- A petition to wind up the operations of Lung Hing Piece Goods Limited will be heard before the High Court of Hong Kong on January 26, 2011, at 9:30 a.m. Choy Chun Nam and Choy Chun Po filed the petition against the company on November 22, 2010. The Petitioner's solicitors are: Chong, So & Co. Units 2201-2, ING Tower No. 308 Des Voeux Road Central, Hong Kong M.F. PRINTING: John James Toohey Steps Down as Liquidator -------------------------------------------------------- John James Toohey stepped down as liquidator of M.F. Printing Company Limited on December 6, 2010. MERCURIES-JEANTEX HOLDINGS: Toohey Steps Down as Liquidator ----------------------------------------------------------- John James Toohey stepped down as liquidator of Mercuries-Jeantex Holdings Limited on December 6, 2010. MINGWAY COMPANY: Creditors' Proofs of Debt Due January 31 --------------------------------------------------------- Creditors of Mingway Company Limited, which is in members' voluntary liquidation, are required to file their proofs of debt by January 31, 2011, to be included in the company's dividend distribution. The company commenced wind-up proceedings on December 20, 2010. The company's liquidators are: Natalia Seng Sze Ka Mee Cynthia Wong Tak Yee Level 28, Three Pacific Place 1 Queen's Road East Hong Kong MOULIN HOLDINGS: Creditors Get 7% Recovery on Claims --------------------------------------------------- Moulin Holdings (H.K.) Limited, which is in voluntary liquidation, paid fifth interim dividend to its creditors on December 31, 2010. The company paid 7% for ordinary claims. The company's liquidators are: Roderick John Sutton Desmond Chung Seng Chiong c/o FTI Consulting (Hong Kong) Limited 14/F The Hong Kong Club Building 3A Chater Road Central, Hong Kong XELO PLC: S&P Withdraws 'CCC-' Rating on Tranche B Notes -------------------------------------------------------- Standard & Poor's Ratings Services withdrew its rating on the tranche B notes of Xelo PLC Series 2006 (Spinnaker III Asia Mezz) following a repurchase and unwind of the notes. The rating action on the affected transaction is: Name Rating To Rating From ---- --------- ----------- Xelo PLC Series 2006 (Spinnaker III Asia Mezz) Tranche B N.R. CCC- (sf) N.R. ? Not rated. ========= I N D I A ========= ANJALEE GRANITES: CRISIL Assigns 'B' Rating to INR181.6MM LT Loan ----------------------------------------------------------------- CRISIL has assigned its 'B/Stable/P4' ratings to the bank facilities of Anjalee Granites Pvt Ltd. Facilities Ratings ---------- ------- INR181.6 Million Long Term Loan B/Stable (Assigned) INR29.9 Million Proposed LT Bank Loan Facility B/Stable (Assigned) INR37.5 Million Packing Credit P4 (Assigned) INR37.5 Million Foreign Bill P4 (Assigned) Purchase The ratings reflect AGPL's working-capital-intensive operations and below-average financial risk profile marked by low net worth and marginal scale of operations. These weaknesses are partially offset by the extensive experience of AGPL's promoters in the granite industry. Outlook: Stable CRISIL believes that AGPL will maintain its business risk profile, despite being a new entrant in the industry, over the medium term, on account of its promoters' extensive industry experience. The outlook may be revised to 'Positive' if AGPL significantly increases its scale of operations, while diversifying its revenue base and improving its financial risk profile. Conversely, the outlook may be revised to 'Negative' if AGPL's revenues and profitability decline because of adverse movements in foreign exchange rates, or if it undertakes an additional large, debt- funded capex. About Anjalee Granites AGPL was incorporated in September 2008 by Mr. Hari Prasad Pothineni and Mr. N M R Sabbineni and commenced operations in April 2009. The company is a 100 per cent export-oriented unit, which has been functioning as a merchant exporter. AGPL is setting up a processing and polishing unit in Ongole (Andhra Pradesh). Commercial production at this plant, which will have a capacity of 20,000 square metres per month, is expected to commence by December 2010. AGPL reported a provisional profit after tax (PAT) of INR3 million on net sales of INR46 million for 2009-10 (refers to financial year, April 1 to March 31). BHANDARY POWERLINES: ICRA Assigns 'LB-' Rating to INR10.02cr Loan ----------------------------------------------------------------- ICRA has assigned an 'LB-' rating to the INR10.02 crore term loan of Bhandary Powerlines Private Limited. ICRA has also assigned an 'A4' rating to the INR6 crore Non-fund based facilities and INR10.2 crore fund based facilities of the company. The ratings assigned by ICRA reflect BPPL's low margins and stretched debt service coverage indicators, which have been accentuated by reduction in scale of operation in FY 2009 and FY2010 due to factors including global recession. Sharp volatility in input copper price and some order cancellation issues during recession has resulted in losses and near erosion of net worth in the past couple of years. The return indicators have been low esp. in the wake of capacity expansion and high level of subsequent underutilization of capacity. Company's liquidity profile is stretched and financial flexibility is limited. ICRA notes that the copper conductor segment is fairly fragmented and competitive industry with relatively low level of value addition, hence reduction in scale of operation results in cost disadvantage and reduced profitability. The ratings are however supported by sufficiently long experience of the promoters in copper conductor business and overall robust demand of conductors in medium to long term given the expected investments in Transmission & Distribution (T&D) segment. Going forward, company's ability to increase scale of operation and service its debt obligations in timely manner will be key rating drivers. About Bhandary Powerlines Incorporated in 1989, the Manipal-based BPPL manufactures paper- insulated copper conductors, bus bars, and enamel strips, primarily used by the power transformer industry. BPPL supplies products primarily to destinations in UK and Middle East. The existing installed production capacity is 10,000 tpa with facilities located in Manipal and Vadodara. For FY2009-10, BPPL reported a loss of INR1.14 crore on net sales of INR39.31 crore, against a loss of INR4.03 crore and net sales of INR79.56 crore, in the previous year. CCS INFOTECH: CRISIL Reaffirms 'BB+' Rating on INR100MM Loan ------------------------------------------------------------ CRISIL's ratings on the bank facilities of CCS Infotech Ltd continue to reflect CCS's below-average financial risk profile constrained by its small net worth and weak debt protection measures, the pressure on the company's margins because of the fragmented nature of the IT hardware industry and competition from large players, and the working-capital-intensive nature of its operations. These weaknesses are partially offset by CCS's established position in the system integration and computer hardware market with a strong clientele. Facilities Ratings ---------- ------- INR100 Million Cash Credit BB+/Stable(Reaffirmed) INR75 Million Proposed LT Bank BB+/Stable(Reaffirmed) Loan Facility INR60 Million Letter of Credit P4+(Reaffirmed) INR15 Million Bank Guarantee P4+(Reaffirmed) As part of this rating exercise, CRISIL has combined the financial risk profiles of CCS and its 100% subsidiary, CCS Infotech Singapore Pte Ltd (CCS Singapore). This is because CCS Singapore managed by the promoters of CCS and both companies has a common line of business and fungible funds. Outlook: Stable CRISIL believes that CCS will continue to benefit from its established position in the system integration and computer hardware market and its strong clientele. The outlook may be revised to 'Positive' in case of a substantial improvement in the company's cash flows and margins, resulting in a healthy financial risk profile. Conversely, the outlook may be revised to 'Negative' in case of a significant decline in CCS's operating margin and cash flows on account of intense competition in the computer hardware market and substantial losses in subsidiary, adversely affecting its debt protection metrics, or if the company takes up huge debt funded capex leading to deterioration in the capital structure. Update CCS's revenue for 2009-10 was marginally higher than CRISIL's expectation mainly due to higher sales in the Singapore subsidiary. However, CCS Singapore reported losses during 2009-10 mainly due to slowdown in the global economy. CCS reported losses on a consolidated basis in 2009-10 mainly due to the losses in the subsidiary. However the CCS's profitability has improved for the six month ended September 30, 2010 with a net profit of INR5.0 million. In the current year, CCS has entered into a contract with Hewlett- Packard (HP) for distribution of its products in Chennai region. The company has also received a five year contract to lease computers to Bharat Heavy Electricals Limited, Bangalore. The contract would contribute INR2.5 million every quarter to the revenue for the next five years. CRISIL expects the company's business risk profile to improve in the medium term backed by the higher cash accruals from the new contracts. CCS's gearing remained low in 2009-10 which was in line with CRISIL's projections. However the gearing is expected to increase in the medium term mainly due to the new term loan taken for the BHEL contract. CCS is expected to have sufficient cash accruals for its repayment obligation of INR8 million during 2011- 12. For 2009-10, CCS (consolidated with CCS Singapore) reported a net loss of INR3.6 million on a turnover of INR789.4 million, against a net profit of INR5.1 million on a turnover of INR710.2 million for 2008-09. About CCS Infotech Set up as a partnership firm in 1989 by Mr. H Ratnakumar and Mr. M A Hasan Abdul Kadar, and incorporated as a public limited company in 1997, CCS assembles desktops, servers, and notebooks, and provides system integration and networking solutions. CCS started its retail information technology (IT) operations in March 2008 and currently has two outlets in Chennai. The company's retail outlets sell multi-branded IT and lifestyle products. DSF GRAND: ICRA Reaffirms 'LBB' Rating on INR6.8cr Term Loan ------------------------------------------------------------ ICRA has reaffirmed the 'LBB' rating to the INR6.8 crore term loan of DSF Grand Plazas Private Limited. The outlook on the long term rating is stable. The assigned rating takes into account the fact that DSFGPPL has successfully commissioned its shopping mall-cum-hotel project. The rating is however constrained by the adverse capital structure characterized by high gearing of 5.12 x as on March 31, 2010, the low occupancy levels in the hotel and the vacancy risk for the retail portion due to absence of lock-in period. In September 2008, DSFGPPL set up a shopping mall-cum-hotel venture consisting of 74 rooms and 34 shops in Tuticorin. The retail portion comprising of shops has been leased out by the company and the same is fully occupied. DSFGPPL is closely held by the promoters of the Tuticorin-based DSF group, which was founded in 1976 by Mr. Devanesam and is managed by his five sons at present, led by Mr. D. Durairaj and Mr. D. Paulpandi. The DSF group is primarily engaged in the processing and export of sea foods (mainly shrimp, cuttlefish and squid) through four entities which include Diamond Sea Food --the flagship entity, Kadalkanny Frozen Foods, Theva & Co. and Edhayam Frozen Foods Private Limited. The group has a presence in other segments of the sea foods business like feed sales, hatching and aquaculture through Theva Erudhayam Aqua Farms, King Ice Plant and Edhayam & Co. The shopping-mall-cum-hotel at Tuticorin is the first major venture of the DSF group in real estate and hospitality sector. DSFGPPL reported a profit after tax of INR0.05 crore on an operating income of INR4.77 crore in 2009-10. EMKAY AUTOMOBILE: CRISIL Places 'B+' Rating on INR54.7MM LT Loans ----------------------------------------------------------------- CRISIL has assigned its 'B+/Stable/P4' ratings to the bank facilities of Emkay Automobile Industries Ltd. Facilities Ratings ---------- ------- INR260 Million Cash Credit Limit B+/Stable (Assigned) INR54.7 Million Long-Term Loans B+/Stable (Assigned) INR35.3 Million Proposed Long-Term B+/Stable (Assigned) Bank Loan Facility INR20 Million Letter of Credit P4 (Assigned) The ratings reflect Emkay Auto's high customer concentration in revenues, and weak financial risk profile marked by high gearing and poor debt protection measures. These rating weaknesses are partially offset by the benefits that Emkay Auto derives from its promoters' competence and experience in the auto component business. Outlook: Stable CRISIL believes that Emkay Auto will continue to benefit over the medium term from its longstanding relationships with major customers, and initiatives to develop new products and acquire new customers. Its debt protection metrics may, however, remain constrained on account of lower profitability and large working capital requirements. The outlook may be revised to 'Positive' if Emkay Auto's net worth and capital structure improve substantially, led by fresh equity infusions and improvement in profitability. Conversely, the outlook may be revised to 'Negative' if Emkay Auto's financial risk profile deteriorates owing to larger-than-expected, debt-funded capex, or if its operating margin declines. About Emkay Automobile Emkay Auto, promoted by Mr. M K Jajoo in 1978, manufactures coil springs, precision sheet metal and tubular components, forgings, tube mill, wire drawing and aluminium pressure die casting. The company's manufacturing units are located at Gurgaon (Haryana), Ludhiana (Punjab), Nashik (Maharashtra), and Pantnagar and Haridwar (Uttaranchal). The company mainly supplies components to manufacturers of two wheelers. For 2009-10 (refers to financial year, April 1 to March 31), Emkay Auto reported a profit after tax of INR20.2 million (up from INR13.0 million in 2008-09) on net revenues of INR1276.2 million (INR1066.2 million in the previous year). GANGES FORD: CRISIL Assigns 'BB-' Rating to INR30.8MM Term Loan --------------------------------------------------------------- CRISIL has assigned its 'BB-/Stable' rating to the bank facilities of Ganges Ford (Proprietor Lexicon Commercial Enterprises Ltd). Facilities Ratings ---------- ------- INR55 Million Cash Credit BB-/Stable (Assigned) INR30.8 Million Term Loan BB-/Stable (Assigned) The rating reflects Ganges's weak financial risk profile, marked by small net worth and high gearing, and the pressure on its margins as a result of intense competition in the automobile dealership business. These rating weaknesses are partially offset by Ganges's established market position and good relations with Ford India Pvt Ltd. Outlook: Stable CRISIL expects Ganges to benefit over the medium term from its increasing scale of operations. The outlook may be revised to 'Positive' if Ganges's financial risk profile improves, most likely because of fresh equity infusion, or a significant and sustainable increase in volumes and profitability. Conversely, the outlook may be revised to 'Negative' if Ganges financial risk profile deteriorates, most likely because of a large, debt-funded capital expenditure programme or decline in cash accruals. About Ganges Ford Ganges was incorporated in 1983 as a non-banking financial company (NBFC). However, in 2004, the company closed down its NBFC business and began Ford automobile dealerships. The company is an authorised dealer of Ford's entire range of passenger cars (PCs); it also sells spares, accessories, and provides services of Ford's PCs. The company derives majority of its revenues from Kolkata, though it also has a presence in Siliguri, Durgapur, and Haldia (all in West Bengal). Ganges has one owned showroom, workshop, and stockyard apart from two rented stockyards. The company, over the next one year, has plans to open another workshop, with an estimated capital outlay of INR25 million, which is expected to be funded in a debt-to-equity mix of 7:3. Ganges also has plans to establish a display centre in 2011-12 (refers to financial year, April 1 to March 31). Ganges's day-to-day operations are looked after by the company's promoter-director, Mr. Harish Himatsingka, who has about seven years of experience in the automobile business. Ganges reported a profit after tax (PAT) of INR1.3 million on an operating income of INR307.3 million for 2009-10, against a PAT of INR4.7 million on operating income of INR290.3 million for 2008-09. GOEL INT'L: CRISIL Assigns 'B' Rating to INR211.3MM Term Loan ------------------------------------------------------------- CRISIL has assigned its 'B/Stable/P4' ratings to the bank facilities of Goel International Pvt Ltd, which is part of the Goel group. Facilities Ratings ---------- ------- INR75.0 Million Cash Credit B/Stable (Assigned) INR211.3 Million Term Loan B/Stable (Assigned) INR85.3 Million Proposed LT B/Stable (Assigned) Bank Loan facility INR700 Million Packing Credit P4 (Assigned) INR75 Million Bill Purchase P4 (Assigned) The ratings reflect the Goel group's weak financial risk profile, marked by high gearing, average net worth, and below-average debt protection metrics, and driven by large working capital requirements; the ratings also reflect significant customer concentration in the group's revenue profile, along with its susceptibility to fluctuation in rainfall, and adverse regulatory changes. These rating weaknesses are partially offset by the extensive experience of the Goel group's promoters, and the benefits that it derives from healthy growth prospects, in the basmati rice industry. For arriving at the ratings, CRISIL has combined the business and financial risk profiles of GIPL and Goel Overseas, together referred to as the Goel group; this is because both the entities are in the same line of business, are owned by common promoters, and derive considerable operational, financial, and business synergies from each other. Further, the bank line are cross guaranteed by each other. Outlook: Stable CRISIL believes that the Goel group will continue to benefit from its promoter's extensive presence in the rice industry over the medium term; its financial risk profile will, however, remain constrained because of working capital intensive nature of operations. The outlook may be revised to 'Positive' if the group's financial risk profile improves, most likely as a result of increase in share capital or improvement in operating margin. Conversely, the outlook may be revised to 'Negative' if the group's financial risk profile deteriorates, most likely because of large, debt-funded capital expenditure programmes, or significant increase in inventory, leading to large incremental bank borrowings. About the Group GIPL was set up in 1998 as a partnership firm, Goel International, by Mr. Vijay Goel and his brothers, Mr. Vinod and Mr. Krishan. The firm was reconstituted as a private limited company in 2000. It is into milling, processing, and selling basmati rice in the export and domestic markets. The company's rice processing unit at Karnal (Haryana) has an aggregate capacity of 7.5 tonnes per hour (tph). In 2002, in order to focus on domestic business, Mr. Vijay Goel and his brothers set up GOV as a partnership firm. The firm is into milling, processing, and selling basmati rice. The firm's rice processing unit at Karnal has an aggregate capacity of 5 tph. The Goel group derives around 70 per cent of its revenues from exports to the Middle East; the rest is derived from sales in the domestic market. The group sells rice in the domestic market under its own brands namely, Galaxy, Shabnam, Harpal, and Gulista, while it exports under the buyer's brand. GIPL reported a loss of INR19.8 million on net sales of INR1.83 billion for 2009-10 (refers to financial year, April 1 to March 31), against a profit after tax (PAT) of INR4.0 million on net sales of INR1.65 billion for 2008-09. HMA AGRO: ICRA Assigns 'LC' Rating to INR20.6cr Fund Based Debts ---------------------------------------------------------------- ICRA has assigned a long term rating of 'LC' to INR20.6 crore fund based facilities of HMA Agro Industries Limited. ICRA has also assigned a short term rating of 'A5' to INR0.2 crore non-fund based facilities of HAIL. ICRA ratings factor in the irregularities in debt servicing by the company due to delay in the commissioning of its processing facility. The ratings are further constrained by the high competitive intensity of the buffalo meat industry and susceptibility of the business to change in regulatory framework and event risks like disease out-break. The ratings however derive comfort from the experience of the promoters in the business and the company's favorable location, which ensures easy accessibility to raw material. HMA Agro Industries Limited is a public limited company promoted by the members of the Qureshi family in 2008. The company has been promoted by the group to set up a fully integrated buffalo meat facility which is presently under commissioning. The facility is located in Aligarh, Uttar Pradesh (U.P.) and has a capacity to process up to 15,000 tonnes per annum (TPA) of buffalo meat. The facility has been approved by the Agricultural and Processed Food Products Export Development Authority for export of buffalo meat. INDUSTRIAL SAFETY: CRISIL Assigns 'P4+' Rating on INR150MM Debt --------------------------------------------------------------- CRISIL has assigned its 'P4+' rating to the bank facilities of Industrial Safety Products Pvt. Ltd. Facilities Ratings ---------- ------- INR150 Million Packing Credit P4+ (Assigned) INR350 Million Foreign Bill Purchase/ P4+ (Assigned) Foreign Bill Discounting Purchase INR50 Million Stand by Foreign Bill P4+ (Assigned) Purchase/Foreign Bill Discounting The rating reflects ISPPL's below-average financial risk profile, marked by moderate net worth, high gearing, below average net cash accruals to total debt ratio, and moderate interest coverage ratio. The ratings also reflect ISPPL's susceptibility to risks related to presence in the fragmented leather industry and high exposure to European market which is currently facing a slowdown. These weaknesses are partially offset by ISPPL's moderate business risk profile, supported by its promoter's industry experience and established relationship with its customers. About Industrial Safety ISPPL, a 100 per cent export-oriented unit, was incorporated in 1998 by Mr. Gopal Naredi, and manufactures industrial leather gloves and garments. The company's facility is in Topsia (Kolkata), which is a hub for leather-based industries. The current installed capacity of ISPPL is around 25 million pairs of industrial gloves per annum. Leather gloves account for more than 95 per cent of its revenues. The company exports its products to Italy, France, Germany, the US, UK, Australia, and New Zealand. The company derives more than 60 per cent of its revenues from European countries. ISPPL reported a profit after tax (PAT) of INR14.5 million on net sales of INR1002.4 million for 2009-10 (refers to financial year, April 1 to March 31), against a PAT of INR15.6 million on net sales of INR1115.6 million for 2008-09. MEDALL HEALTHCARE: ICRA Assigns 'LBB+' Rating to INR75cr Term Loan ------------------------------------------------------------------ ICRA has assigned an 'LBB+' rating to the INR75 crore fund-based term loan facilities of Medall Healthcare Private Limited; the outlook on the long-term rating is Stable. The rating takes into account the fragmented structure of the medical diagnostics industry with many unorganized players; capital intensive nature of the business; tie-ups that existing players have with various hospitals as well as existing hospitals with integrated diagnostic centres that constrain growth in the near term. The business model is dependent on the reputation of radiologists, and given the scarcity of radiologists, the exit of experienced radiologists from the clinical team may adversely impact operations. Also, the volume of tests are dependent on referrals from doctors, and the marketing capability of the company remains to be seen, especially in tier-II and tier-III cities, where a number of greenfield centres are being set up. The ratings are also constrained by the tight cash flows of the company owing to substantial capital outlay. The ratings consider the growth prospects of medical diagnostics in the near-to-medium term; inorganic growth through acquisition of reputed diagnostic centres in Chennai and Bengaluru; operations led by experienced radiologists, who have been retained from the acquired centres, and backed by a strong clinical team; and the successful track record of the promoter of successfully establishing and operating different business ventures in the past. About Medall Healthcare Medall Healthcare Private Limited, formerly Precision Diagnostics Pvt. Ltd. (Precision), was incorporated in 2009 and is engaged in providing diagnostic services in the field of radiology imaging, pathology, microbiology and other specialized healthcare services. Precision was founded as a partnership firm in 1989 and converted into a private limited company in 1994 by the initial promoters. In August 2009, the promoters sold their stake to Mr. Raju Venkatraman and private equity (PE) investors, Peepul Capital LLC and Chintalapati Holdings; Mr. Venkatraman and the PE funds now hold 25% and 75% stake in the company respectively; subsequently, Precision was renamed as Medall Healthcare. Medall also acquired a 91% stake in Clumax Diagnostics and Research Centre Pvt. Ltd., Bengaluru in February 2010 as part of its inorganic growth strategy. The company currently operates 15 diagnostic centres in Chennai, Trichy, Bengaluru, Tirunelveli, Pondicherry and other locations in Tamil Nadu and more new centres are being planned. The company is also pursuing further inorganic expansion through acquisitions in various parts of Southern India. The company has also been awarded a Public-Private Partnership (PPP) contract by the Andhra Pradesh government for providing diagnostic services at medical colleges in Kakinada, Kurnool, Vishakhapatnam and Warangal. The company reported operating income of INR8.5 crore and net after tax loss of INR4.3 crores in FY2010. MEP COTTON: ICRA Assigns 'LC' Rating to INR44.5cr Term Loans ------------------------------------------------------------ ICRA has assigned an 'LC' rating to the INR44.5 crore term loans and INR55.5 crore fund based facilities of MEP Cotton Limited. The assigned rating reflects the ongoing delays by the company is servicing debt obligations owing to tight liquidity position and the highly leveraged capital structure with a gearing of 5.3x as on March 31, 2010. The rating is also constrained by the low margin nature of the ginning industry with profitability further impacted by high interest costs and inherent seasonality in operations. The rating also factors in the proximity of the company's ginning facility to one of the major cotton growing belts in India and the favorable monsoons thus ensuring adequate availability of raw cotton during the current season. Moreover, the recent surge in international and domestic cotton prices is likely to help increase realizations for the company in the near term. However, the business outlook for ginning in India remains sensitive to Government regulations such as the Minimum Support Price (MSP) mechanism for raw cotton and restrictions on export of cotton bales. About MEP Cotton Incorporated on January 2000, MEP Cotton Limited is a joint venture between the KKM Group (Promoted by Mr. Krishna Kumar Mittal) and the Welspun Group. The company is engaged in cotton ginning, cottonseed oil extraction and refining with its manufacturing facilities located at Gondal, Rajkot. The area around the plant is one of the major cotton belts in India and cultivates the Shankar-6 variety of cotton. The company setup its first ginning unit in 2007. By the end of 2008, the company completed the setup of the remaining two ginning units at the same location and currently has a total capacity of pressing 1,800 bales per day. The company also manufactures cottonseed oil through crushing of the residual cottonseeds at the plant and has setup a refinery for refining washed oil. MEP reported a net loss of INR3.3 crore in FY 2010 on an operating income of INR321.6 crore as compared to a net loss of INR11.2 crore on an operating income of INR103.4 crore in FY 2009. OSWAL PUMPS: CRISIL Reaffirms 'BB+' Rating on INR25MM Term Loan ---------------------------------------------------------------- CRISIL's rating on the bank facilities of Oswal Pumps Ltd continues to reflect Oswal Pumps' modest financial risk profile marked by moderately high gearing and weak debt protection indicators. Facilities Ratings ---------- ------- INR300.0 Million Cash Credit Limit BB+/Stable (Reaffirmed) INR25.0 Million Term Loan BB+/Stable (Reaffirmed) The rating also factors in company's exposure to pricing pressures because of fragmentation and competition in the pump industry. These rating weaknesses are partially offset by Oswal Pumps' established market position in the pump industry, and the company's above-average research and development capabilities. Outlook: Stable CRISIL believes that Oswal Pumps' financial risk profile will remain constrained over the medium term because of weak capital structure and debt protection indicators; the company may also be exposed to pressures related to quality and pricing of products, and working capital management. The outlook may be revised to 'Positive' if Oswal Pumps' financial risk profile improves significantly, most likely because of increase in cash accruals. Conversely, the outlook may be revised to 'Negative' if the company's financial risk profile weakens, most likely because of large, debt-funded capital expenditure (capex), or lower-than- expected sales and profitability. Update For 2009-10 (refers to financial year, April 1 to March 31), Oswal Pumps reported a net sales of INR923 million, which is an average annual growth rate of 15 per cent over the past two years. For 2010-11, CRISIL expects the sales of Oswal Pump not to grow significantly over that in 2009-10. This is because Oswal Pump is shifting its manufacturing facility to a new location because of space constrains at its existing location; thus, its operations are expected to be affected during the shifting and stabilization phase. The shifting of the facility started in the second quarter of 2010-11 and is expected to be completed by the end of December 2010. For the six months ended September 30, 2010, the company has reported sales of around INR493 million. The company's operating margin for 2009-10 was at the expected levels of around 8.5 per cent; operating margin is expected to remain at around 8 per cent in the medium term. In the medium term, Oswal Pumps have moderate capex plans of around INR80 million for the next one year which also includes setting up a casting line for manufacturing parts used in pump manufacturing. The company plans to fund majority of the same through internal accruals and through funds from promoters in form of equity and unsecured loans. Gearing was 2.4 times as on March 31, 2010, and is expected to remain above 2.0 times in the medium term as its operations are highly working capital intensive; with increase in sales in 2011-12, working capital requirements are expected to increase. Interest coverage ratio was around 2.0 times in 2009-10 and is expected to remain at this level over the medium term. About Oswal Pumps Oswal Pumps was incorporated in 2003 by Mr. Padam Sain Gupta and his sons, Mr. Rajev Gupta and Mr. Vivek Gupta; it was reconstituted as a closely held limited company in January 2007. The company took over the operations of Oswal Electricals (Pumps), a proprietorship firm of the same promoter. Oswal Pumps manufactures submersible and monobloc pumps, and electric motors at its plant in Karnal (Haryana). The company intends to move its plant to a new location over the near term. For 2009-10, Oswal Pumps reported a profit after tax (PAT) of INR8.9 million on net sales of INR923 million, against a PAT of INR5.1 million on net sales of INR888 million for 2008-09. RAJIT PAINTS: CRISIL Downgrades Rating on INR14.7MM Loan to 'D' --------------------------------------------------------------- CRISIL has downgraded its ratings on the bank facilities of Rajit Paints Ltd to 'D/P5' from 'BB+/Stable/P4+'. Facilities Ratings ---------- ------- INR210.0 Million Cash Credit D (Downgraded from 'BB+/Stable') INR14.7 Million Term Loan D (Downgraded from 'BB+/Stable') INR22.5 Million Letter of Credit P5 (Downgraded from 'P4+') The downgrade reflects recent instances of delay by RPL in servicing its debt; the delays have been caused by RPL's weak liquidity. RPL has large working capital requirements, and a modest financial risk profile marked by weak debt protection metrics and a small net worth. These weaknesses are partially offset by RPL's established track record in the industrial paints business. Set up in 1985 by Mr. Rakesh Mehra and Mr. Rohit Nagrath, RPL manufactures industrial paints, including liquid automotive paints, industrial powder coatings, general industry paints, and other allied products. Its manufacturing unit in Ahmedgarh (Punjab) has capacity of 38,000 litres of liquid paints per day and 100 tonnes of powder coatings per month. Rajit mainly caters to automotive ancillary units, original equipment manufacturers, and other sectors that utilise industrial paints. RPL reported a profit after tax (PAT) of INR29 million on net sales of INR1080 million for 2009-10 (refers to financial year, April 1 to March 31), against a PAT of INR13 million on net sales of INR815 million for 2008-09. SHREEJIKRUPA BUILDCON: ICRA Puts 'LBB' Rating on INR7cr Cash Debt ----------------------------------------------------------------- ICRA has assigned an 'LBB' rating to the INR7.00 crore cash credit facility of Shreejikrupa Buildcon Limited. The outlook for the long term rating is stable. ICRA has also assigned an 'A4' rating to INR6.00 crore short-term, non-fund based bank guarantee facilities of SBL. The assigned ratings take into account SBL's relatively small scale of operations; sectoral concentration risk arising from focus on largely single sector (civil construction); client concentration risks with majority of the projects being executed for semi-government authorities; high competitive intensity in the construction space resulting in pressure on margins and geographical concentration risks due to concentration of ongoing and future projects in Gujarat. The ratings are further constrained by weak capital structure with high gearing levels and low coverage indicators. The ratings also take into account the vulnerability of profitability to raw material price variation although the same is mitigated to a large extent on account of presence of escalation clause in the contracts. The ratings however, favorably factor in SBL's experienced management; long track record of SBL's promoters in the construction industry; its moderate order book position and favorable demand outlook for the construction sector given the government focus on infrastructure development and increased public spending. The ratings also factor in the presence of a diversified and reputed client base of semi-government authorities leading to relatively lower counter party credit risks. About Shreejikrupa Buildcon Shreejikrupa Buildcon Limited earlier known as Shreejikrupa Builders Rajkot was established in the year 1998 and is engaged in civil & construction engineering and contracting services. SBL has successfully commissioned a wide variety of prestigious projects in the field of civil construction, heavy foundations, bridges & EWS Housing Schemes. It also provides consultancy and contract management services. SBL has registration for approved contractor in 'AA' class and 'Special Category I Building' class from the Gujarat state government. For the year ended March 31, 2010, the company reported an operating income of INR22.69 crore and profit after tax of INR0.87 crore. STANDARD CORP: CRISIL Assigns 'B' Rating to INR200 Mil. Term Loan ----------------------------------------------------------------- CRISIL has assigned its 'B/Negative/P4' ratings to the bank facilities of Standard Corporation India Ltd. Facilities Ratings ---------- ------- INR156.0 Million Cash Credit B/Negative (Assigned) INR200.0 Million Term Loan B/Negative (Assigned) INR50.0 Million Letter of Credit P4 (Assigned) The ratings reflect SCIL's large working capital requirements, low operating margin, and susceptibility to downturns in the agro- based machinery industry. These rating weaknesses are partially offset by the extensive experience of SCIL's promoters in the agro-based machinery industry. Outlook: Negative CRISIL's negative outlook reflects SCIL's stretched liquidity position reflected from overutilisation of bank lines, devolvement of letter of credit along with insufficient cash accruals against term loan repayments of INR52 million in current year. The liquidity is expected to remain stretched on account of high working capital requirement over the medium term. The rating may be downgraded if SCIL generates lesser-than-expected cash accruals, thereby further weakening its liquidity, or undertakes larger-than-expected debt-funded capital expenditure (capex) programme, thereby weakening its capital structure. Conversely, the outlook may be revised to 'Stable' if SCIL improves its liquidity, or strengthens its financial flexibility by generating more-than-expected operating income, thereby improving profitability, or by bringing in fresh equity capital from promoters. About Standard Corporation SCIL manufactures harvester combines, tractors, and cranes under the Standard brand. Mr. Nachattar Singh and his brother Mr. Joginder Singh established the partnership firm Standard Combine in 1979. The firm was reconstituted as a private limited company in 1999 and as a public limited company (with name being changed to the current one) in 2008. Its manufacturing unit is in Barnala (Punjab). SCIL has capacity to manufacture 2000 harvester combines, 7500 tractors, and 300 cranes per annum. SCIL reported a profit after tax (PAT) of INR27.6 million on net sales of INR1903.0 million for 2009-10 (refers to financial year, April 1 to March 31), against a PAT of INR9.8 million on net sales of INR1736.0 million for 2008-09. SUNGRO SEEDS: ICRA Downgrades Rating on INR10cr Loan to 'LBB+' -------------------------------------------------------------- ICRA has downgraded the rating assigned to the INR10 crore term loan facility and INR7.5 crore long term fund based facilities of Sungro Seeds Limited from 'LBBB-' to 'LBB+'. ICRA has also downgraded the rating assigned to the INR1 crore short term non fund based facilities of SSL from 'A3' to 'A4+'. ICRA has also assigned a 'Stable' outlook to the long term rating. The downgrade reflects lower than anticipated profitability in the recent past, inadequate returns from new processing plant leading to weak overall return on capital employed and weakening of liquidity position translating from sharp increase in working capital intensity. The ratings continue to be constrained by the vulnerability of the company's profitability to agro climatic conditions, high competition from other seed companies and other crops for land availability, high financial risk profile marked by low profitability, high gearing and weak debt coverage indicators. However, the ratings favorably factor in the long track record of SSL's promoters in the seeds business, established market position in vegetable seeds business, particularly in Northern and Eastern India, access to the research base of Mahyco Group and increasing share of higher margin hybrids in the overall revenue mix. Sungro Seeds Limited, incorporated in 1973, is involved in the, development, production, marketing of vegetable seeds. The company was initially promoted by Dr R.S.Punia, however he divested his stake in 1996 to the Mr B.R.Barwale and his family. SSL belongs to the Mahyco group which is running one of India's leading seeds company. The Mahyco group's main business is the manufacture of seeds through its flagship company - Maharashtra Hybrid Seeds company (Mahyco) and SSL, besides agricultural machinery (through John Fowler group of companies). Sungro Seeds Limited is engaged in the production of Hybrid and Open Pollinated vegetable seeds with production centres across 8 different locations across the country. The company reported a net loss of INR0.21 crore on a turnover of INR48.33 crore in 2009-10. V R COATINGS: CRISIL Places 'BB' Rating on INR30MM Long Term Loan ----------------------------------------------------------------- CRISIL has assigned its 'BB/Stable/P4+' ratings to V R Coatings Pvt Ltd's bank facilities. Facilities Ratings ---------- ------- INR30.0 Million Cash Credit Limit BB /Stable (Assigned) INR30.0 Million Proposed LT Bank BB /Stable (Assigned) Loan Facility INR10.0 Million Letter of Credit/ P4+ (Assigned) Bank Guarantee The ratings reflect VRCPL's small scale and working-capital- intensive operations, and the susceptibility of its operating margin to volatility in raw material prices and foreign exchange rates. These weaknesses are partially offset by VRCPL's moderate financial risk profile, driven by adequate debt protection measures and moderate gearing, and the promoters' extensive experience in the automated painting systems industry. Outlook: Stable CRISIL believes that VRCPL's scale of operations will remain small over the medium term and its financial flexibility will remain restricted because of its small net worth. The outlook may be revised to 'Positive' if VRCPL increases its scale of operations and sustains it at the improved level, continues to prudently manage its working capital management, and increases its net worth. Conversely, the outlook may be revised to 'Negative' if the company's liquidity weakens significantly, most likely because of decline in operating margin resulting in lower-than-expected cash accruals, or if the company undertakes large, debt-funded capex programme, weakening its capital structure. About V R Coatings Set up in 1985 by the D'Souza family, VRCPL manufactures and installs automated painting systems that handle liquid and semi- liquid paints. VRCPL manufactures pneumatically-driven airless spray painting and dispensing equipment. These systems are used in automobile, ship building, steel fabrication, and heavy engineering industries. The company has a facility in Pune (Maharashtra) and caters to the domestic as well as export markets. VRCPL reported a profit after tax (PAT) of INR4.3 million on net sales of INR147.1 million for 2009-10 (refers to financial year, April 1 to March 31), against a PAT of INR1.8 million on net sales of INR149.6 million for 2008-09. VATIKA LIMITED: ICRA Places 'LBB' Rating on INR193.34cr Bank Debt ----------------------------------------------------------------- ICRA has assigned an 'LBB' rating to INR193.34 crore bank lines of Vatika Limited. The outlook on the rating is Stable. ICRA's rating factors in Vatika's established track record in developing real estate projects in National Capital Region (NCR), good quality of its projects; and the reputed tenant profile in its leased-out properties. The rating also draws comfort from the good market response for its recently launched projects as reflected by high level of bookings and customer advances. The rating is however constrained by its exposure to execution risk, considering the significant area under development; market risks for the unbooked area in its on-going/future projects and its exposure to geographical risk resulting from concentration of its on-going/upcoming projects in North India (primarily Gurgaon and Jaipur). The rating also takes into account Vatika's high gearing; its low debt protection indicators and its significant debt repayment obligations over the short-to-medium term which exposes the company to high refinancing risk. While assigning the rating, ICRA has also noted the fact that the hotel project of the group is currently running with a delay; any further delay in the project execution can put the overall profitability of the project under pressure. Going forward, ability to successfully execute its fund raising plans, maintaining its sales momentum in the upcoming projects and ensuring timely payments from the existing bookings would be the key rating sensitivities. Vatika Group, incorporated in 1986, was promoted by Delhi based Bhalla family. The company has been engaged in commercial, residential and hospitality segments of real estate, primarily in National Capital Region (NCR). The group comprises of Vatika Limited (formerly known as Vatika Land Base private limited), Vatika Hospitality Private Limited and Vatika Hotels private Limited. Vatika Limited is the flagship company of the group and all the real estate projects are developed by this company. Vatika hospitality runs restaurants, health clubs and business centres, and Vatika Hotels is developing a 5 star hotel in Gurgaon. In 2009-10, as per the provisional financial statements, Vatika limited reported a turnover of INR626 crore and net profit of INR60.67 crore. VENKATESWARA ELECTRICAL: CRISIL Puts 'BB-' Rating to LT Loan ------------------------------------------------------------ CRISIL has assigned its 'BB-/Stable/P4+' ratings to the bank facilities of Venkateswara Electrical Industries Pvt Ltd, part of the Venkateswara group. Facilities Ratings ---------- ------- INR35.00 Million Long-Term Loan BB-/Stable (Assigned) INR137.00 Million Overdraft Facility BB-/Stable (Assigned) INR50.00 Million Letter of Credit P4+ (Assigned) INR86.00 Million Bank Guarantee P4+ (Assigned) The ratings reflect the Venkateswara group's below-average financial risk profile marked by small net worth and weak debt protection metrics, working-capital-intensive operations, and exposure to intense competition in the transformer industry. These rating weaknesses are partially offset by the group's sizeable order book and promoters' extensive industry experience. For arriving at its ratings, CRISIL has combined the business and financial risk profiles of VEIPL and Senthil Engineering Company. This is because both the entities, together referred to as the Venkateswara group, are in the same line of business, are under a common management, and have fungible funds. Outlook: Stable CRISIL believes that the Venkateswara group will continue to benefit from its promoters' industry experience. The outlook may be revised to 'Positive' if the group increases diversification of its revenue profile, scale of operations, and net worth. Conversely, the outlook may be revised to 'Negative' if the group undertakes a large debt-funded capital expenditure programme, thereby weakening its capital structure, or if its cash accruals decline significantly or its receivables level increases. About the Group VEIPL was established in 1978 by Mr. V K Arumugam, father of the company's current managing director, Mr. A Siva Subramani. The company is based in Chennai. VEIPL manufactures a wide range of power transformers (up to 100 megavolt amperes) and distribution transformers (up to 230 kilovolt amperes). The company mainly caters to Tamil Nadu Electricity Board (which accounts for around 90 per cent of VEIPL's revenues), other state electricity boards (around 7 per cent of revenues), and private players. The group has an order book of around INR200 million as on date to be executed over next eight months. The Venkateswara group acquired SEC in 1995; SEC manufactures distribution transformers, mainly of low capacities. Both VAIPL and SEC have manufacturing units in Chennai. The group has an associate entity, Hanuman Homeopathy Medical Trust, which runs a medical college and trust. The Venkateswara group reported a profit after tax (PAT) of INR9.5 million on net sales of INR299.0 million for 2009-10 (refers to financial year, April 1 to March 31), against a PAT of INR8.4 million on net sales of INR327.5 million for 2008-09. ========= J A P A N ========= JAPAN AIRLINES: Privately Places Stocks With Top Executives ----------------------------------------------------------- Japan Airlines Corp. is privately placing stock with its top executives as the company looks to boost accountability and reduce its tax burden, Reuters reports, citing the Nikkei business daily. Reuters says about two dozen top executives, including President Masaru Onishi, took part in a recent offering, with each investing several hundred thousand yen. The Nikkei, according to Reuters, said the combined stake comes to less than 1 percent. Reuters reports the Nikkei said JAL needed to have multiple shareholders since a wholly owned subsidiary cannot adopt consolidated taxation. The Nikkei article reported that JAL plans to make tax payments on a consolidated basis from April next, allowing the company to offset losses against gains within the group or to carry forward a unit's past losses, to cut its annual tax burden by several billion yen, according to Reuters. About Japan Airlines Japan Airlines Corporation -- http://www.jal.co.jp/-- is a Japan-based company mainly engaged in the provision of air transport services. The Company is active in five business segments through its 203 subsidiaries and 83 associated companies. JAL International Co. Ltd. is a wholly owned operating subsidiary of Japan Airlines Corporation. Japan Airlines Corporation, Japan Airlines International Co., Ltd., and JAL Capital Co., Ltd., on January 19, 2010, filed the petitions to commenced corporate reorganization proceedings with the Tokyo District Court. The Court appointed the Enterprise Turnaround Initiative Corporation of Japan and Eiji Katayama, Esq., as reorganization trustees. Japan Airlines Corp. filed for reorganization January 19, 2010, in the Tokyo District Court and filed a Chapter 15 petition in New York (Bankr. S.D.N.Y. Case No. 10-10198). The Company estimated debts at $28 billion. The Tokyo District Court in December 2010 approved JAL's rehabilitation plan, which aims to cut the company's payroll to 32,600 employees by the end of March, shedding roughly 16,000 jobs, or around 30% of its group workforce of 48,714 as of March 31, 2010. ==================== N E W Z E A L A N D ==================== CHRISTCHURCH BUS: Fined NZ$783,000 For Poor Performance ------------------------------------------------------- Radio New Zealand reports that Christchurch Bus Services Ltd has been hit with NZ$783,000 in fines by the Canterbury regional council because of poor performance in November. Radio New Zealand says most of the 62 buses ordered off the road by police in November 2010 were either owned or operated by the company, which is in receivership. At the time, says Radio NZ, the union representing bus drivers was calling for the company to be shut down because of safety issues. According to Radio New Zealand, Wayne Holton-Jeffries, the council's acting director of operations, said Christchurch Bus Services did not have the resources to provide its contracted service during November. Radio New Zealand relates that Mr. Holton-Jeffries said the bus company was struggling financially in September and was allowed to continue running for another month or so until it was sold. Payment of the penalties will have to come from the company's receivers, Mr. Holton-Jeffries added. Christchurch Bus Services was placed in receivership in 2010 and the business was purchased by Hamilton-based Go Bus Ltd in November 2010. Christchurch Bus Services Ltd was a Christchurch, New Zealand- based bus company. It operated Metro routes for Environment Canterbury and private charter services for groups and schools. MERCER GROUP: Westpac Extends Banking Facilities to December 2011 ----------------------------------------------------------------- Mercer Group has accepted an offer from Westpac to extend its banking facilities to December 31, 2011. The offer provides for a reduction to the facility limits of NZ$1.5 million out of the proceeds of the fully underwritten rights issue in early 2011, NZ$1 million in July 2011 and NZ$3 million in November 2011. Westpac has changed the financial covenants, which will apply to the facility. The Company expects to comply with the new covenants. "The underwriting arrangements are now conditional only on the occurrence of a material adverse event before the date the underwriter is required to subscribe for shares under the issue. This is a standard clause in underwriting agreements," Mercer said. The Company has now reviewed its projections for the year ended 30 June 2011. Trading conditions across all businesses continue to be difficult. EBIT for the year is projected to be close to break even on sales of NZ$36 million. This is an improvement on the 2009 result, which was an EBIT deficit of NZ$1.73 million on sales of NZ$37 million. EBITDA is projected to be NZ$1.2 million for the 2011 financial year. As reported in the Troubled Company Reporter-Asia Pacific on May 18, 2010, Mercer Group said it was considering a number of refinancing options after breaching its banking covenant. The company said in a regulatory filing that it has been advised by its bank that it is in breach of its interest cover covenant. The covenant is that earnings are to be no less than 2.25 times the funding costs for the 6 month period ending December 31, 2009. The actual achieved ratio was 1.9 times. Subsequently, the Company drew down NZ$1.5 million from Gresham Finance as authorized by its shareholders at the Annual General Meeting held on November 24, 2009. The funds have been used to reduce bank debt as previously agreed. Principal payments to non bank lenders are on hold. Interest payments are being made in compliance with loan agreements. Established in 1882, Mercer Group designs, makes and distributes stainless steel products for the industrial, dairy, commercial, food processing, healthcare and residential buildings industries. The Mercer group of companies are subsidiaries of the New Zealand listed company Broadway Industries Limited (NZE:BWY). SIMPLYINSURANCE NEW: S&P Raises Insurer Strength Rating to 'BB' --------------------------------------------------------------- Standard & Poor's Ratings Services said that it has raised its insurer financial strength and counterparty credit ratings on New Zealand-based consumer credit insurer SimplyInsurance New Zealand Ltd. to 'BB' from 'BB-'. At the same time, S&P revised the stand- alone credit profile to 'bb-' from 'b+'. The outlook is stable. "The stand-alone credit profile revision reflects S&P's view that SINZ has demonstrated a track record of profitability (albeit low), and a satisfactory claims experience, to build its capital base to a level that is comparable with other 'BB' category peers'," Standard & Poor's credit analyst Derryl D'silva said. "Moderating factors include its concentrated business position and its captive business nature, which limit its overall competitive position." The 'BB' rating reflects S&P's view that SINZ continues to benefit from one notch of support from ownership by, and integration with, global retail financial institution GE Finance and Insurance (GEFI; not rated), from which SINZ sources most of its business. SINZ, however, is not explicitly supported by GEFI, and is not considered to be strategically important under Standard & Poor's group methodology criteria, given its small size relative to the group. Contributing to the SACP as well as the one-notch uplift to the rating are the benefits of access to a high quality management team, and the reputation of being a member of the GEFI business. Also supporting S&P's view are the robust operational and financial management controls that come from its access to the wider GEFI business. The stable outlook reflects S&P's view that the financial profile supports current business volumes and growth expectations. S&P does not expect to raise the rating in the medium term. S&P would consider raising the rating if the company were able to strengthen its competitive position and substantially increase its paid-up capital to a level more consistent with a higher rating category. Also, stronger explicit or implicit support could increase SINZ's strategic importance to GEFI and may result in a higher rating. Conversely, the rating could be lowered if the company were to experience a trend of adverse results, and if it were unable to develop a prudent level of reserves to meet outstanding claims. While S&P believes ownership under GEFI is now more certain, evidence that undermines the insurance operations within the wider group could negatively influence the rating. ================= S I N G A P O R E ================= ARTICON CONSTRUCTION: Creditors' Proofs of Debt Due January 14 -------------------------------------------------------------- Creditors of Articon Construction Pte Ltd, which is in voluntary liquidation, are required to file their proofs of debt by Jan. 14, 2011, to be included in the company's dividend distribution. BUILD TRADE: Creditors Get 2.03712% Recovery on Claims ------------------------------------------------------ Build Trade (S) Pte Ltd declared the first and final dividend to creditors on December 21, 2010. The company paid 2.03712% to the received claims. FRASER THERMAL: Creditors to Get 100% Recovery on Claims -------------------------------------------------------- Fraser Thermal Technology Pte Ltd will declare the first and final dividend on January 7, 2011. The company will pay 100% to all admitted claims. JOHN DEERE: Creditors' Proofs of Debt Due January 31 ---------------------------------------------------- Creditors of John Deere Construction & Forestry (Asia Pacific) Pte. Ltd., which is in creditors voluntary liquidation, are required to file their proofs of debt by January 31, 2011, to be included in the company's dividend distribution. The company's liquidator is: Teh Kwang Hwee c/o 1 Commonwealth Lane #07-32 One Commonwealth Singapore 149544 MULTI-BONDER TRADING: Creditors Get 88.35644% Recovery on Claims ---------------------------------------------------------------- Multi-Bonder Trading Pte Ltd declared the first and final dividend to creditors on December 23, 2010. The company paid 88.35644% to the received claims. SILIJAN PTE: Creditors Get 91.5464% Recovery on Claims ------------------------------------------------------ Silijan Pte Ltd declared the first and final dividend to creditors on December 13, 2010. The company paid 91.5464% to the received claims. SOMERSET (VIETNAM): Creditors' Proofs of Debt Due January 31 ---------------------------------------------------- Creditors of Somerset (Vietnam) Investments Pte Ltd., which is in creditors voluntary liquidation, are required to file their proofs of debt by January 31, 2011, to be included in the company's dividend distribution. The company's liquidators are: Leow Quek Shiong Leong Hon Mun Peter c/o BDO LLP 19 Keppel Road #02-01 Jit Poh Building Singapore 089058 TING SHEAN: Court to Hear Wind-Up Petition January 14 ----------------------------------------------------- A petition to wind up the operations of Ting Shean Engineering Pte Ltd will be heard before the High Court of Singapore on Jan. 14, 2011, at 10:00 a.m. United Overseas Bank Limited filed the petition against the company on December 17, 2010. The Petitioner's solicitors are: Rajah & Tann LLP 9 Battery Road #25-01 Straits Trading Building Singapore 049910 ULTRAPOLIS 3000: Court to Hear Wind-Up Petition January 14 ---------------------------------------------------------- A petition to wind up the operations of Ultrapolis 3000 Investments Ltd, formerly known as Ultrapolis 3000 Theme Park Investments Ltd, will be heard before the High Court of Singapore on Jan. 14, 2011, at 10:00 a.m. Denmarkskibstekniske Konsulente A/S I Likvidation, formerly known as Knud E Hansen A/S, filed the petition against the company on December 23, 2010. The Petitioner's solicitors are: Rodyk & Davidson LLP 80 Raffles Place #33-00 UOB Plaza 1 Singapore 048624 =============== X X X X X X X X =============== * S&P Raises Ratings on Nine Asia-Pacific CDO Tranches ------------------------------------------------------ Standard & Poor's Ratings Services raised the ratings on nine Asia-Pacific (excluding Japan) collateralized debt obligation tranches. At the same time, the ratings were removed from CreditWatch with positive implications, where they were placed on Dec. 16, 2010. To assess the creditworthiness of each class, S&P reviewed the credit quality of the securitized assets using synthetic rated overcollateralization scores and results from supplemental tests. These results measure the degree by which the credit enhancement of a tranche exceeds the stressed loss rate assumed for a given rating scenario. Tranches which had their ratings raised had SROC scores that are greater than 100% at the current rating level and at a higher rating level with sufficient cushion (based on the maximum scenario loss rate, largest obligor test, and largest industry test). SROC scores rising above 100% reflect an improvement in the credit quality of the underlying portfolio. Ratings Raised Rating From Rating To ----------- --------- Athenee CDO PLC Series 2007-2 BB- (sf)/Watch Pos BB (sf) Athenee CDO PLC Series 2007-3 B+ (sf)/Watch Pos BB- (sf) Athenee CDO PLC Series 2007-5 B (sf)/Watch Pos B+ (sf) Athenee CDO PLC Series 2007-9 BB- (sf)/Watch Pos BB (sf) Athenee CDO PLC Series 2007-8 B+ (sf)/Watch Pos BB- (sf) Athenee CDO PLC Series 2007-10 BB+ (sf)/Watch Pos BBB- (sf) Athenee CDO PLC Series 2007-12 B (sf)/Watch Pos B+ (sf) Athenee CDO PLC Series 2007-15 BB- (sf)/Watch Pos BB (sf) ARLO IX Ltd. Pascal Series 2007 B (sf)/Watch Pos B+ (sf) Notes: 1. Where the final price on defaulted reference names in CDO portfolios is not known, S&P's analysis takes into consideration the auction results for these names from the International Swaps and Derivatives Association, Inc. 2. In accordance with the criteria for rating CDO transactions, certain factors such as credit stability and rating sensitivity to modeling parameters may be considered in assigning ratings to CDO tranches, in addition to the supplemental tests, the Monte Carlo default simulation results, and the associated cash flow modeling. Such risks in transactions may be assessed on a case-by-case basis and the ratings may be qualitatively adjusted to a rating level different than that indicated by the various quantitative results. The tranches' final ratings reflect the result of any such qualitative adjustments. ********* Tuesday's edition of the TCR-AP delivers a list of indicative prices for bond issues that reportedly trade well below par. Prices are obtained by TCR-AP editors from a variety of outside sources during the prior week we think are reliable. Those sources may not, however, be complete or accurate. The Tuesday Bond Pricing table is compiled on the Friday prior to publication. Prices reported are not intended to reflect actual trades. Prices for actual trades are probably different. Our objective is to share information, not make markets in publicly traded securities. Nothing in the TCR-AP constitutes an offer or solicitation to buy or sell any security of any kind. It is likely that some entity affiliated with a TCR-AP editor holds some position in the issuers' public debt and equity securities about which we report. A list of Meetings, Conferences and Seminars appears in each Wednesday's edition of the TCR-AP. Submissions about insolvency- related conferences are encouraged. Send announcements to conferences@bankrupt.com Friday's edition of the TCR-AP features a list of companies with insolvent balance sheets obtained by our editors based on the latest balance sheets publicly available a day prior to publication. At first glance, this list may look like the definitive compilation of stocks that are ideal to sell short. Don't be fooled. Assets, for example, reported at historical cost net of depreciation may understate the true value of a firm's assets. A company may establish reserves on its balance sheet for liabilities that may never materialize. The prices at which equity securities trade in public market are determined by more than a balance sheet solvency test. ********* 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., Frederick, Maryland, USA. Valerie U. Pascual, Marites O. Claro, Joy A. Agravante, Rousel Elaine T. Fernandez, Psyche A. Castillon, Julie Anne G. Lopez, Ivy B. Magdadaro, Frauline S. Abangan, and Peter A. Chapman, Editors. Copyright 2011. All rights reserved. ISSN: 1520-9482. This material is copyrighted and any commercial use, resale or publication in any form (including e-mail forwarding, electronic re-mailing and photocopying) is strictly prohibited without prior written permission of the publishers. Information contained herein is obtained from sources believed to be reliable, but is not guaranteed. TCR-AP subscription rate is US$625 for 6 months delivered via e- mail. Additional e-mail subscriptions for members of the same firm for the term of the initial subscription or balance thereof are US$25 each. For subscription information, contact Christopher Beard at 240/629-3300. *** End of Transmission ***