/raid1/www/Hosts/bankrupt/TCRAP_Public/120419.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
Thursday, April 19, 2012, Vol. 15, No. 78
Headlines
A U S T R A L I A
AUSTRALIAN PERFORMANCE: Financial Services License Suspended
HILLSIDE MEATS: Fails to Find Possible Creditor
SISS ADMINISTRATION: Creditors' Meeting Set for April 30
C H I N A
GUANGZHOU GLOBAL: Incurs US$348,000 Net Loss in 2011
SUNRISE REAL ESTATE: Incurs US$1.2 Million Net Loss in 2011
TONGJI HEALTHCARE: Incurs US$218,000 Net Loss in 2011
H O N G K O N G
ABLE GRACE: Creditors' Proofs of Debt Due May 10
BLUESTONE CAPITAL: Moyes and Yuen Step Down as Liquidators
CARRIER COMFORT: Liu and Yen Appointed as Liquidators
CHAMP RICH: Final Meetings Set for May 5
GAMEX CHINA: AI Yin Steps Down as Liquidator
GC HOLDINGS: Ho and Fung Step Down as Liquidators
HEALTH LIFE: Members' Final Meeting Set for May 15
HK ADVANTAGE: Members' Final Meeting Set for May 14
HK ASSOCIATION: Placed Under Voluntary Wind-Up Proceedings
HSIN CHONG: Chang Shuk Chien Appointed as Liquidator
LEHMAN BROTHERS: HKMA Reports Progress of Probe on Minibond Cases
LU HAN: Members' Final Meeting Set for May 14
MOTORBIKE CRUISERS: Members' Final Meeting Set for May 31
PERRY CAPITAL: Creditors' Proofs of Debt Due May 12
REGENT EARNING: Creditors' Meeting Set for May 8
ROYAL FAMILY: Members' Final Meeting Set for May 14
I N D I A
ARNAV INDUSTRIES: ICRA Reaffirms 'BB-' Rating on INR8cr Loan
CHANDRAPORE & HEGGDLOO: ICRA Puts 'C+' Rating on INR37.8cr Loan
CLASSIC COTTON: ICRA Reaffirms 'B+' Rating on INR15.11cr Loan
DCS TRADING: Fitch Assigns Nat'l Long-Term Rating at 'BB-
DEEDI RESORTS: ICRA Assigns 'D' Rating to INR22cr Term Loan
ESWAR RUBBER: Fitch Affirms Nat'l Long-Term Rating at 'BB-'
HIMALAYAN BUILDERS: CRISIL Assigns 'D' Rating on INR118.5MM Loan
IDEAL ICE: ICRA Assigns 'B+' Rating to INR4.57cr LT Loans
KINGFISHER AIRLINES: Allots 3.56cr Equity Share Against OCDs
M&M COCOA: ICRA Reaffirms 'D' Rating on INR20.40cr Bank Loans
R.K. INFRA: Inadequate Info Cues Fitch to Migrate Ratings
R.V.M EDUCATION: CRISIL Puts 'CRISIL B-' Rating on INR200MM Loan
SAURASHTRA FERROUS: Delays in Loan Payment Cues ICRA Junk Ratings
SHIVAM HI-TECH: CRISIL Places 'BB-' Rating on INR23.6MM Loan
SHREE NAMAN: ICRA Cuts Rating on INR557cr Loan to '[ICRA]D'
S. S. CONSTRUCTION: CRISIL Puts 'BB-' Rating on INR10MM Loan
I N D O N E S I A
BANK NEGARA: Moody's Rating on USD Notes Incorporates 'D' BFSR
J A P A N
ASAHI MUTUAL: Fitch Affirms 'BB' Insurer Finc'l. Strength Rating
J-CORE FL1: S&P Lowers Ratings on 2 Certificate Classes to 'D'
K O R E A
KOREA DEVELOPMENT: S&P Lowers Stand-alone Credit Profile to 'bb+'
SUHYUP BANK: Moody's Issues Summary Credit Opinion
N E W Z E A L A N D
ALLIED NATIONWIDE: Receivers Await Offer to Handover Assets
S R I L A N K A
BANK OF CEYLON: Moody's Assigns 'B1' Rating; Outlook Stable
BANK OF CEYLON: Fitch Places 'BB-' IDR With Stable Outlook
V I E T N A M
* VIETNAM: 20% Seafood Firms Face Stagnancy, Bankruptcy in 2012
- - - - -
=================
A U S T R A L I A
=================
AUSTRALIAN PERFORMANCE: Financial Services License Suspended
------------------------------------------------------------
The Australian Securities and Investments Commission has
suspended the Australian financial services (AFS) license of
Australian Performance Financial Planning Pty Ltd for three
months.
"The company's license has been suspended until July 1, 2012,
because it has been put under the control of an external
administrator," ASIC said in a statement.
"An external administrator was appointed to Australian
Performance Financial Planning in February 2012."
The company had receivers appointed in February by BankWest, who
were owed about AUD5.9 million, according to The Sydney Morning
Herald.
ASIC said it will review the suspension within the three month
period to determine whether it continues to be necessary.
Australian Performance Financial Planning has the right to appeal
to the Administrative Appeals Tribunal for a review of ASIC's
decision.
Australian Performance Financial Planning is a financial planning
business that provides financial advice for clients with self-
managed super funds or similar investments and income protection
and life insurance policies.
HILLSIDE MEATS: Fails to Find Possible Creditor
-----------------------------------------------
Tyson Cattle at Farm Weekly reports that Hillside Meats has
failed to secure a creditor following its second creditors
meeting late in March.
Farm Weekly discloses that the processor went into voluntary
administration on November 13 last year and had appointed Derrick
Vickers and Kate Warwick, PricewaterhouseCoopers Australia (PwC),
as joint administrators for the company.
Since then, it has been working on securing a possible creditor
for the company but an arrangement had not been reached, the
report relates.
Farm Weekly says Mr. Vickers and Ms. Warwick became liquidators
of the company.
"As liquidators, we will be looking at all options to try and
realise the company's assets," the report quotes Mr. Vickers as
saying.
Hillside Meats owner Peter "Polly" Trefort told Farm Weekly in an
exclusive interview last December that low sheep numbers, the
high Australian dollar and a fatal accident at the abattoir, all
played a role in putting the company into voluntary
administration.
Farm Weekly relates that Mr. Trefort now said he had not given up
hope of the business operating in some form again in the future.
SISS ADMINISTRATION: Creditors' Meeting Set for April 30
--------------------------------------------------------
A meeting of creditors of Siss Administration Services Pty
Limited will be held on April 30, 2012, at the offices of Ferrier
Hodgson, Level 13, Grosvenor Place, 225 George Street, Sydney NSW
2000 at 11:00 a.m.
Max Christopher Donnelly was appointed on Sept. 21, 2011, as
Official Liquidator of Siss Administration by an Order of the
Federal Court of Australia.
The liquidator may be reached at:
Max Christopher Donnelly
Level 13, Grosvenor Place
225 George Street
Sydney NSW 2000
Phone: +61 2 9286 9999
Fax: +61 2 9286 9888
E-mail: max.donnelly@fh.com.au
=========
C H I N A
=========
GUANGZHOU GLOBAL: Incurs US$348,000 Net Loss in 2011
----------------------------------------------------
China Teletech Holding, Inc., formerly known as Guangzhou Global
Telecom, Inc., filed with the U.S. Securities and Exchange
Commission its annual report on Form 10-K disclosing a net loss
of US$348,124 on US$18.84 million of sales in 2011, compared with
a net loss of US$2.28 million on US$34.18 million of sales in
2010.
The Company's balance sheet at Dec. 31, 2011, showed US$2.42
million in total assets, US$5.10 million in total liabilities and
a US$2.68 million total stockholders' deficit.
For 2011, Samuel H. Wong & Co., LLP, in San Mateo, California,
noted that the Company has incurred substantial losses, and has
difficulty to pay the People's Republic of China government Value
Added Tax and past due Debenture Holders Settlement, all of which
raise substantial doubt about its ability to continue as a going
concern
A copy of the Form 10-K is available for free at:
http://is.gd/YkV6Aw
About Guangzhou Global
Tallahassee, Fl.-based Guangzhou Global Telecom, Inc., was
incorporated as Avalon Development Enterprises, Inc., on
March 29, 1999, under the laws of the State of Florida. The
Company, through its subsidiaries, is now principally engaged in
the distribution and trading of rechargeable phone cards,
cellular phones and accessories within cities in the People's
Republic of China.
SUNRISE REAL ESTATE: Incurs US$1.2 Million Net Loss in 2011
---------------------------------------------------------
Sunrise Real Estate Group, Inc., filed with the U.S. Securities
and Exchange Commission its annual report on Form 10-K disclosing
a net loss of US$1.22 million on US$9.27 million of net revenues
in 2011, compared with a net loss of US$25,487 on US$12.82
million of net revenues in 2010.
The Company's balance sheet at Dec. 31, 2011, showed US$22.17
million in total assets, US$25.25 million in total liabilities
and a US$3.08 million total shareholders' deficit.
For 2011, Kenne Ruan, CPA, P.C., in Woodbridge. CT, USA, noted
that the Company has significant accumulated losses from
operations and has a net capital deficiency that raise
substantial doubt about its ability to continue as a going
concern.
A copy of the Form 10-K is available for free at:
http://is.gd/w5Iiaq
About Sunrise Real
Headquartered in Shanghai, the People's Republic of China,
Sunrise Real Estate Group, Inc. was initially incorporated in
Texas on Oct. 10, 1996, under the name of Parallax Entertainment,
Inc. On Dec. 12, 2003, Parallax changed its name to Sunrise Real
Estate Development Group, Inc. On April 25, 2006, Sunrise Estate
Development Group, Inc. filed Articles of Amendment with the
Texas Secretary of State, changing the name of Sunrise Real
Estate Development Group, Inc. to Sunrise Real Estate Group,
Inc., effective from May 23, 2006.
The Company and its subsidiaries are engaged in the property
brokerage services, real estate marketing services, property
leasing services and property management services in China.
TONGJI HEALTHCARE: Incurs US$218,000 Net Loss in 2011
-----------------------------------------------------
Tongji Healthcare Group, Inc., filed with the U.S. Securities and
Exchange Commission its annual report on Form 10-K disclosing a
net loss of US$218,150 on US$2.68 million of total operating
revenue in 2011, compared with a net loss of US$56,232 on
US$1.90 million of total operating revenue in 2010.
The Company's balance sheet at Dec. 31, 2011, showed
US$12.21 million in total assets, US$12.21 million in total
liabilities, and a US$5,161 total stockholders' deficit.
For 2011, EFP Rotenberg, LLP, in EFP Rotenberg, LLP, expressed
substantial doubt about the Company's ability to continue as a
going concern. The independent auditors noted that the Company
has negative working capital of US$9,849,936, an accumulated
deficit of US$581,741, and a stockholders' deficit of US$5,161 as
of Dec. 31, 2011. The Company's ability to continue as a going
concern ultimately is dependent on the management's ability to
obtain equity or debt financing, attain further operating
efficiencies, and achieve profitable operations.
A copy of the Form 10-K is available for free at:
http://is.gd/4myI9g
About Tongji Healthcare
Based in Nanning, Guangxi, the People's Republic of China, Tongji
Healthcare Group, Inc., was incorporated in the State of Nevada
on December 19, 2006. The Company operates Tongji Hospital,
a general hospital with 105 licensed beds.
================
H O N G K O N G
================
ABLE GRACE: Creditors' Proofs of Debt Due May 10
------------------------------------------------
Creditors of Able Grace Limited, which is in members' voluntary
liquidation, are required to file their proofs of debt by May 10,
2012, to be included in the company's dividend distribution.
The company's liquidator is:
Chang Shuk Chien
12/F, No. 3 Lockhart Road
Wanchai, Hong Kong
BLUESTONE CAPITAL: Moyes and Yuen Step Down as Liquidators
----------------------------------------------------------
Paul David Stuart Moyes and Betty Yuen Yeung stepped down as
liquidators of Bluestone Capital Management Hong Kong Limited on
March 30, 2012.
CARRIER COMFORT: Liu and Yen Appointed as Liquidators
-----------------------------------------------------
Stephen Liu Yiu Keung and David Yen Ching Wai on March 30, 2012,
were appointed as liquidators of Carrier Comfort Company Limited.
The liquidators may be reached at:
Stephen Liu Yiu Keung
David Yen Ching Wai
62nd Floor, One Island East
18 Westlands Road
Island East
Hong Kong
CHAMP RICH: Final Meetings Set for May 5
----------------------------------------
Members and creditors of Champ Rich Asia Pacific Limited will
hold their final meetings on May 5, 2012, at 12:00 p.m., and
12:30 p.m., respectively at Room 1103, Hang Seng Mongkok
Building, 677 Nathan Road, Mongkok, in Kowloon.
At the meeting, Hui Sze Wai, the company's liquidator, will give
a report on the company's wind-up proceedings and property
disposal.
GAMEX CHINA: AI Yin Steps Down as Liquidator
--------------------------------------------
AI Yin stepped down as liquidator of Gamex China Limited on
April 3, 2012.
GC HOLDINGS: Ho and Fung Step Down as Liquidators
-------------------------------------------------
Dr. Terence Ho Yuen Wan and Henry Fung stepped down as
liquidators of GC Holdings Limited on March 30, 2012.
HEALTH LIFE: Members' Final Meeting Set for May 15
--------------------------------------------------
Members of Health Life Limited will hold their final meeting on
May 15, 2012, at 11:00 a.m., at Unit F, 18/F, Legend Tower, at
7 Shing Yip Street, Kwun Tong, Kowloon, in Hong Kong.
At the meeting, Wong Kit Sang, the company's liquidator, will
give a report on the company's wind-up proceedings and property
disposal.
HK ADVANTAGE: Members' Final Meeting Set for May 14
---------------------------------------------------
Members of Hong Kong Advantage Power Limited will hold their
final meeting on May 14, 2012, at 2:30 p.m., at Rooms 1901-2,
Park-In Commercial Centre, 56 Dundas Street, in Kowloon.
At the meeting, Lee Kwok On Alexander, the company's liquidator,
will give a report on the company's wind-up proceedings and
property disposal.
HK ASSOCIATION: Placed Under Voluntary Wind-Up Proceedings
----------------------------------------------------------
At an extraordinary general meeting held on March 22, 2012,
creditors of Hong Kong Association of Secretaries and
Administrative Professionals Limited resolved to voluntarily wind
up the company's operations.
The company's liquidator is:
Li Pik Hung
Suites 1501-2, 15/F
Chinachem Johnston Plaza
178-186 Johnston Road
Wan Chai
HSIN CHONG: Chang Shuk Chien Appointed as Liquidator
----------------------------------------------------
Chang Shuk Chien on March 30, 2012, was appointed as liquidator
of Hsin Chong Real Estate Agency Limited.
The liquidator may be reached at:
Chang Shuk Chien
12/F, No. 3 Lockhart Road
Wanchai, Hong Kong
LEHMAN BROTHERS: HKMA Reports Progress of Probe on Minibond Cases
-----------------------------------------------------------------
The Hong Kong Monetary Authority announced on April 13 that
investigation of over 99% of a total of 21,851 Lehman-Brothers-
related complaint cases received has been completed. These
include:
* 15,769 cases which have been resolved by a settlement
agreement reached under section 201 of the Securities and
Futures Ordinance;
* 3,444 cases which have been resolved through the enhanced
complaint handling procedures required by the settlement
agreement;
* 2,406 cases which were closed because insufficient prima
facie evidence of misconduct was found after assessment or
no sufficient grounds and evidence were found after
investigation;
* 25 cases (including minibond cases) which are under
disciplinary consideration after detailed investigation by
the HKMA, of which proposed disciplinary notices are being
prepared; and
* 158 cases in respect of which investigation work has been
completed and are going through the decision process to
decide whether there are sufficient grounds for
disciplinary actions or whether the cases should be closed
because of insufficient evidence or lack of disciplinary
grounds.
Investigation work is underway for the remaining 47 cases.
A table summarizing the progress of the disciplinary and
complaint-resolution work in respect of Lehman-Brothers-related
complaints is available at http://is.gd/82vtfM
About Lehman Brothers
Lehman Brothers Holdings Inc. -- http://www.lehman.com/-- was
the fourth largest investment bank in the United States. For
more than 150 years, Lehman Brothers has been a leader in the
global financial markets by serving the financial needs of
corporations, governmental units, institutional clients and
individuals worldwide.
Lehman Brothers filed for Chapter 11 bankruptcy Sept. 15, 2008
(Bankr. S.D.N.Y. Case No. 08-13555). Lehman's bankruptcy
petition disclosed US$639 billion in assets and US$613 billion in
debts, effectively making the firm's bankruptcy filing the
largest in U.S. history. Several other affiliates followed
thereafter.
Affiliates Merit LLC, LB Somerset LLC and LB Preferred Somerset
LLC sought for bankruptcy protection in December 2009.
The Debtors' bankruptcy cases are handled by Judge James M. Peck.
Harvey R. Miller, Esq., Richard P. Krasnow, Esq., Lori R. Fife,
Esq., Shai Y. Waisman, Esq., and Jacqueline Marcus, Esq., at
Weil, Gotshal & Manges, LLP, in New York, represent Lehman. Epiq
Bankruptcy Solutions serves as claims and noticing agent.
Dennis F. Dunne, Esq., Evan Fleck, Esq., and Dennis O'Donnell,
Esq., at Milbank, Tweed, Hadley & McCloy LLP, in New York, serve
as counsel to the Official Committee of Unsecured Creditors.
Houlihan Lokey Howard & Zukin Capital, Inc., is the Committee's
investment banker.
On Sept. 19, 2008, the Honorable Gerard E. Lynch of the U.S.
District Court for the Southern District of New York, entered an
order commencing liquidation of Lehman Brothers, Inc., pursuant
to the provisions of the Securities Investor Protection Act (Case
No. 08-CIV-8119 (GEL)). James W. Giddens has been appointed as
trustee for the SIPA liquidation of the business of LBI.
The Bankruptcy Court approved Barclays Bank Plc's purchase of
Lehman Brothers' North American investment banking and capital
markets operations and supporting infrastructure for US$1.75
billion. Nomura Holdings Inc., the largest brokerage house in
Japan, purchased LBHI's operations in Europe for US$2 plus the
retention of most of employees. Nomura also bought Lehman's
operations in the Asia Pacific for US$225 million.
Lehman emerged from bankruptcy protection on March 6, 2012, more
than three years after it filed the largest bankruptcy in U.S.
history. Lehman is set to make its first payment to creditors
under its $65 billion payout plan on April 17, 2012.
International Operations Collapse
Lehman Brothers International (Europe), the principal UK trading
company in the Lehman group, was placed into administration,
together with Lehman Brothers Ltd, LB Holdings PLC and LB UK RE
Holdings Ltd. Tony Lomas, Steven Pearson, Dan Schwarzmann and
Mike Jervis, partners at PricewaterhouseCoopers LLP, have been
appointed as joint administrators to Lehman Brothers
International (Europe) on Sept. 15, 2008. The joint
administrators have been appointed to wind down the business.
Lehman Brothers Japan Inc. and Lehman Brothers Holdings Japan
Inc. filed for bankruptcy in the Tokyo District Court on
Sept. 16. Lehman Brothers Japan Inc. reported about JPY3.4
trillion (US$33 billion) in liabilities in its petition.
Bankruptcy Creditors' Service, Inc., publishes Lehman Brothers
Bankruptcy News. The newsletter tracks the Chapter 11 proceeding
undertaken by Lehman Brothers Holdings, Inc., and other
insolvency and bankruptcy proceedings undertaken by its
affiliates. (http://bankrupt.com/newsstand/or 215/945-700)
LU HAN: Members' Final Meeting Set for May 14
---------------------------------------------
Members of Lu Han Sen Charity Fund Limited will hold their final
meeting on May 14, 2012, at 11:00 a.m., at Room 2301-D3, 23/F,
Nan Fung Centre, at 264-298 Castle Peak Road, Tsuen Wan, in Hong
Kong.
At the meeting, Shiu Moon Yuen Simon, the company's liquidator,
will give a report on the company's wind-up proceedings and
property disposal.
MOTORBIKE CRUISERS: Members' Final Meeting Set for May 31
---------------------------------------------------------
Members of Motorbike Cruisers Club (Hong Kong) Limited will hold
their final general meeting on May 31, 2012, at 10:00 a.m., at
4th Floor, Li Fung Building, 96 Argyle Street, Mong Kok, Kowloon,
in Hong Kong.
At the meeting, Lam Wah, the company's liquidator, will give a
report on the company's wind-up proceedings and property
disposal.
PERRY CAPITAL: Creditors' Proofs of Debt Due May 12
---------------------------------------------------
Creditors of Perry Capital (Asia) Limited, which is in members'
voluntary liquidation, are required to file their proofs of debt
by May 12, 2012, to be included in the company's dividend
distribution.
The company's liquidator is:
Choi Wai Man
Suite 504, 5/F
Nathan Centre
580G-580K Nathan Road
Kowloon, Hong Kong
REGENT EARNING: Creditors' Meeting Set for May 8
------------------------------------------------
Contributories and creditors of Regent Earning Limited will hold
their meeting on May 8, 2012, at 10:00 a.m., and 2:30 p.m.,
respectively for the purposes provided for in Sections 241, 242,
243, 244, 242, 255A of the Companies Ordinance.
The meeting will be held at 1909-10, Nan Fung Tower, at 173 Des
Voeux Road Central, in Hong Kong.
ROYAL FAMILY: Members' Final Meeting Set for May 14
---------------------------------------------------
Shareholders of Royal Family Limited will hold their final
general meeting on May 14, 2012, at 9:00 a.m., at Room 1410,
14/F, Harbour Centre, at 25 Harbour Road, Wanchai, in Hong Kong.
At the meeting, Poon Wai Hung Richard, the company's liquidator,
will give a report on the company's wind-up proceedings and
property disposal.
=========
I N D I A
=========
ARNAV INDUSTRIES: ICRA Reaffirms 'BB-' Rating on INR8cr Loan
------------------------------------------------------------
ICRA has reaffirmed '[ICRA]BB-' rating to the INR8.00 crores fund
based limits of Arnav Industries Private Limited. The outlook on
the long-term rating is stable.
Amount
Facilities (INR Cr) Ratings
---------- --------- -------
Fund based Limits 8.00 [ICRA]BB- reaffirmed
The rating is constrained by intensely competitive nature of the
textile industry, APIL's limited track record of operations and
vulnerability of its profitability metrics and cash flows to the
cyclicality inherent in the textile industry. The rating also
takes into account APIL's moderate scale of operations which
coupled with low profitability has resulted in moderate cash
accruals. The working capital intensity of operations is high
resulting in high utilization of bank limits. AIPL's working
capital requirements have been funded primarily through debt as
cash accruals have been moderate due to low profitability. This
has resulted in relatively high gearing of 2.54 times as on
March 31, 2011 as well as moderate debt protection indicators.
Nevertheless the rating favorably factors in the established
track record of the promoters in textile industry, AIPL's
diversified client base and its operational linkages with its
group company which assures supply of raw materials at reasonable
prices.
Arnav Industries Private Limited is a part of Arnav Group which
is involved in textile business. Earlier the group was managed by
Mr. Omkar Manji and Mr. Champalal Agarwal and the business was
conducted through two companies namely Omkar Textile Mills Pvt.
Ltd and Gopi Synthetics Private Limited. However, due to a
family partition, the control of GSPL was taken over by
Mr. Champalal Agarwal OTMPL was managed by Shri Omkarmal Agarwal.
Omkar brand was retained by Mr. Omkar Manji and Mr. Champalal
decide to conduct his business under the brand name 'Arnav'.
Currently Arnav Group (renamed) operates through three main
entities namely Gopi Synthetics Private Limited which is the
flagship company of the group, Arnav Industries Private Limited
and Arnav Textile Mills Private Limited. GSPL is involved in
processing of fabric, AIPL is involved in sale of processed
fabric to semi-wholesalers while ATMPL is involved in sale of
fabric to retailers under 'Arnav' and 'Colours' brand.
CHANDRAPORE & HEGGDLOO: ICRA Puts 'C+' Rating on INR37.8cr Loan
---------------------------------------------------------------
ICRA has assigned an '[ICRA]C+' rating to the INR35.50 crore
existing term loans and INR2.30 crore proposed term loans of M/s
Chandrapore & Heggdloo Estates.
Amount
Facilities (INR Cr) Ratings
---------- --------- -------
Term Loans-Existing 35.50 [ICRA]C+
Term Loans-Proposed 2.30 [ICRA]C+
The rating incorporates the adverse financial profile of the firm
characterised by net losses, high gearing levels and weak
coverage indicators. ICRA notes that the firm has abnormally
large interest and principal repayment obligations over the next
five years, in relation to the current size of its operations.
However, the rating also incorporates the operational and
financial support extended by the group and the healthy demand
outlook for coffee driven by growing consumption. ICRA favorably
notes the growth in operating income of the firm, over the last
two years, aided by increased revenue from sale of timber and
improving yield levels as most of the plants have crossed their
gestational period. Nevertheless, the revenues of the firm remain
highly susceptible to largely uncontrollable factors like adverse
climatic condition and pest attacks, which are inherent to the
firms operating in agricultural sector.
About Chandrapore & Heggdloo
M/s Chandrapore & Heggdloo estates, established in 2007, is a
proprietorship firm held by Mr. V.G.Siddhartha (promoter of the
Amalgamated Bean & Coffee Trading Company Ltd, which has presence
across the entire value chain of coffee processing). The firm
holds two coffee estates- Heggdloo estate and Chandrapore estate.
Heggdloo estate measuring 180.05 acres is planted primarily with
arabica coffee plant with small portion of robusta coffee. The
inter crops grown are pepper and areca nut. Chandrapore estate
measures 420.40 acres and is planted with both arabica and
robusta coffee plants. The inter crops grown are pepper and areca
nut. Both the estates are located at Mudigree taluk in
Chikamagalur district of Karnataka. Apart from coffee and other
intercrops, the estates also have around 55,000 trees.
Recent Results:
M/s Chandrapore & Heggdloo estates, reported a net loss of
INR0.50 crore on an operating income of INR2.45 crore during FY11
as against a net loss of INR1.34 crore on an operating income of
INR1.15 crore during FY10. For the ten months ended December
2011, the firm has registered a profit before tax of
INR3.55 crore on an operating income of INR7.52 crore
(provisional).
CLASSIC COTTON: ICRA Reaffirms 'B+' Rating on INR15.11cr Loan
-------------------------------------------------------------
ICRA has reaffirmed an '[ICRA]B+' rating to the INR13.50. crore
cash credit facility and INR1.61crore (reduced from INR2.40
crore) term loan facility of Classic Cotton Pvt Ltd.
Amount
Facilities (INR Cr) Ratings
---------- --------- -------
Cash Credit Facility 13.50 [ICRA]B+ reaffirmed
(Long Term - Fund Based)
Term Loan Facility 1.61 [ICRA]B+ reaffirmed
(Long Term - Fund Based)
The assigned ratings continues to be constrained by weak
financial profile as reflected by low profitability, highly
leveraged capital structure on account of working capital
intensive nature of the business and weak debt protection
indicators. The ratings also take into account the low value
additive nature of the business and intense competition on
account of fragmented industry structure which exerts further
pressure on margins. The rating further incorporates the
vulnerability of profitability to fluctuations in raw material
prices given the seasonal availability of raw cotton and
government regulations on MSP and export quota.
The ratings, however, favorably consider the long experience of
the promoters in the cotton industry and the favorable location
of the company giving it easy access to high quality raw cotton.
About Classic Cotton
Classic Cotton Pvt Ltd was incorporated as a closely held company
in 2008. The company is engaged in cotton ginning and pressing to
produce cotton bales and cotton seeds. The company's fully
automated plant is located in Jetpur, dist Rajkot which is very
close to the rich cotton belts of saurashtra districts. Classic
Cotton Pvt Ltd has 36 ginning machines and one pressing machine
with an intake capacity of 200 MTPD of raw cotton to produce 400
bales per day.
Recent Results:
For the year ended March 31, 2011, the company reported an
operating income of INR52.57crore with profit after tax of
INR0.12 crore. During the period from April 2011 to February 2012
the company has achieved an operating income of INR55.93 crore.
DCS TRADING: Fitch Assigns Nat'l Long-Term Rating at 'BB-
---------------------------------------------------------
Fitch Ratings has assigned India's DCS Trading and Services Pvt
Ltd a National Long-Term rating of 'Fitch BB-(ind)' with Stable
Outlook.
The ratings are constrained by DCS's small operational size, lack
of formal agreements with its principals, and the risks
associated with its recent entry into the capital-intensive
cranes business in which the company has no experience.
The ratings also reflect its long-established relationships with
most of its principals, exclusive dealership in India for its
portfolio of capital goods and consumbales, a large customer base
and a long relationship with its customers. Its credit metrics
are comfortable with low leverage and strong interest coverage
Positive rating action may result from a substantial increase in
its operational size, underpinned by a diversification of its
product portfolio. Conversely negative rating action may result
from net leverage deteriorating to 3.5x on a sustained basis.
DCS is a 14-year old company based out of Hyderabad trading in
machinery spares and consumables used in various industries
ranging from mining to power plants to automobiles. DCS reported
revenue of INR181m (FY10: INR141m) with an EBITDA of INR23m
(INR17m) and EBITDA margin of 12.4% (12.2%). Net leverage was
0.5x (0.34x) and interest cover was 6.08x ( 11.47x).
Fitch has also assigned ratings to DCS's bank facilities as
follows.
-- INR45m fund-based working capital loans: 'Fitch BB-
(ind)'/'Fitch A4+(ind)'
-- INR47.5m non fund-based working capital loans: 'Fitch A4+
(ind)'
DEEDI RESORTS: ICRA Assigns 'D' Rating to INR22cr Term Loan
-----------------------------------------------------------
ICRA has assigned long-term rating of '[ICRA]D' to the INR22.00
crore term loan facilities and the INR0.50 crore fund based
facilities of Deedi Resorts Private Limited.
Amount
Facilities (INR Cr) Ratings
---------- --------- -------
Term loan facilities 22.00 [ICRA]D assigned
Fund based facilities 0.50
The rating takes into account the delay in debt servicing by the
Company owing to tight liquidity conditions. The damage to the
resort "Le Pondy" during the cyclone "Thane" led to a 2-3 month
closure of operations (during January 2012 - March 2012) added to
liquidity pressures. The Company's operations are relatively
small, with a single property in Pondicherry, and faces
competition from existing properties in the vicinity. The
financial profile is characterized by net losses owing to higher
interest expenses and high leverage. The capital structure is
expected to be further constrained in the event that the capital
expenditure plans (new resort in Quilon) in the near term are
debt funded. The promoters however have a decade long experience
in the resort business, the Company being part of the larger
Deedi Group. The property enjoys location advantage which is
reflected in steady occupancies and ARRs till December 2011.
About Deedi Resorts
Incorporated in 2004, DRPL operates a 14 acre 70 room resort "Le
Pondy" in Pondicherry. The resort commenced operations in
December 2010. The resort has a board room (60 pax capacity), a
conference and banqueting hall (350 pax capacity), and an
ayurveda centre. With the Company commencing operations towards
end of 2010-11, 2011-12 would be the Company's first full year of
operations. DRPL has recently applied for a three-star rating.
The current shareholders of the Company comprises of Mr. T.C.
Paul, his family and Joy's The Beach Resorts Private Limited
(group company of DRPL which owns a resort in Kerala).
DRPL belongs to the Deedi Group, promoted by Mr. T.C. Paul which
has interest in automobile and hospitality business. The Deedi
group derives bulk of its revenues from automobile dealerships -
Deedi Automobiles - dealer of Bajaj Auto Limited since 1984 and
Deedi Motors Private Limited (DMPL) - dealer of Chevrolet
(General Motors) since 2007. The Deedi group also owns and
operates a heritage beach resort "The Travancore Heritage" in
Chowra (Kerala) since 2001. The group's consolidated revenues
are -INR200.0 crore with DMPL contributing to more than 70% of
the group's revenue.
Recent Results:
DRPL reported operating income of INR5.9 crore during the nine
months ended Dec. 31, 2011 (un-audited). The Company commenced
its operations from December 2010 and reported net losses of
INR2.1 crore on operating income of INR1.4 crore during 2010-11.
ESWAR RUBBER: Fitch Affirms Nat'l Long-Term Rating at 'BB-'
-----------------------------------------------------------
Fitch Ratings has affirmed India-based Eswar Rubber Products
Private Limited's National Long-Term Rating at 'Fitch BB-(ind)'.
The Outlook is Stable.
Fitch's assessment takes a consolidated view of the financial
profile of all ERPL group companies which are in the business of
tyre reclaiming. ERPL has the largest revenue share in the
group.
The ratings are constrained by expected deterioration in ERPL's
financial leverage (net debt/EBITDA) in FY13 onwards (financial
year ending March) on account of its ongoing debt-led capex and
significant term loan repayments from FY13 onwards. ERPL
commissioned a 1.5 million units per annum windmill in March
2012, and is increasing the capacity of its Ananthapur (Andhra
Pradesh) and Salem (Tamil Nadu) plant by 50% each to 20,000
metric tonnes per annum (MTPA) from the current 15,000 MTPA at
about INR105m. The additional capacity is expected to be
commissioned by June-July 2012.
The ratings reflect an improvement in ERPL's financial leverage
and interest coverage in FY11 to 3.24x (FY10: 5.29x) and 1.94x
(1.44x), respectively. Revenue and EBITDA margin also improved to
INR457.9m (INR352m) and 8.2% (6.9%), respectively, due to a
significant increase in volumes and higher selling prices. The
ratings also reflect the experience of ERPL's founders of over
two decades in the tyre/tube reclaimed rubber business.
Negative rating action may result from deterioration in the
company's net debt/EBITDA above 5.5x on a sustained basis.
Conversely, maintaining net debt/EBITDA below 4.0x on a sustained
basis would be positive for the ratings.
Incorporated in 1996, ERPL manufactures butyl-reclaimed rubber
and whole tyre reclaimed rubber at its facility in Salem, Tamil
Nadu and Andhra Pradesh. It supplies to tyre tube and other
rubber products manufacturers in both domestic and exports
markets.
Rating actions on ERPL's bank loans are as follows:
-- INR30.9m long-term loans (reduced from INR48.4m):
affirmed at 'Fitch BB-(ind)'
-- INR65m long-term loan: assigned at 'Fitch BB-(ind)'
-- INR150m fund-based working capital limit (increased from
INR100m): affirmed at 'Fitch BB-(ind)'/'Fitch A4+(ind)'
-- INR100m non-fund based working capital limit: assigned at
'Fitch A4+(ind)'
HIMALAYAN BUILDERS: CRISIL Assigns 'D' Rating on INR118.5MM Loan
----------------------------------------------------------------
CRISIL has assigned its 'CRISIL D' rating to the bank facilities
of Himalayan Builders.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Long-Term Loan 118.5 CRISIL D
The rating reflects the delays by HB in servicing its term loan
obligations; these delays have been primarily caused by the time
and cost overruns in respect of its its ongoing MLA Acropolis
project.
HB, a partnership firm established in 2006 by the Siliguri, West
Bengal based Agarwal family, with Mr. Anil Agarwal and his
brother Mr. Amit Agarwal managing the overall operations of the
firm, is engaged in construction of a mall in Siliguri,West
Bangal, by the name MLA Acropolis. The mall is estimated to
encompass around 2 lakh sq. ft. and is expected to be one of the
largest malls in Siliguri.
IDEAL ICE: ICRA Assigns 'B+' Rating to INR4.57cr LT Loans
---------------------------------------------------------
ICRA has assigned '[ICRA]B+' rating to the INR3.77 crore of term
loan and INR0.80 crore long-term fund based limits of Ideal Ice
Cream.
Amount
Facilities (INR Cr) Ratings
---------- --------- -------
Long Term Fund Based Limit 0.80 [ICRA]B+ assigned
Long Term Fund Based Limit 3.77 [ICRA]B+ assigned
The assigned rating factors in Ideal Ice Cream's established
brand in Mangalore and neighboring markets and strong
distribution network characterized by exclusive parlours in
Mangalore and distributors across the states of Karnataka, Kerala
and Goa. However, the rating is constrained due to small scale of
operations restricting economies of scale, limited geographical
presence with majority of sales derived from Mangalore and high
competition in the ice-cream market from large scale organized as
well as small unorganized players. The rating also factors in
deterioration in the entity's operating margins owing to cost
pressures, its weak profitability and low pricing flexibility
enjoyed by it.
About Ideal Ice
Established in 1975, Ideal Ice Cream Group was promoted by Mr. S.
Prabhakar Kamath with single ice-cream parlour named Ideal Ice
Cream Parlour at Mangalore. With good response, over the years,
Mr. Prabhakar expanded the presence of Ideal Ice Cream Parlour
from one parlour to currently 6 parlours with an aggregate area
of 31,600 sq ft and approximate seating capacity of 1,270 pax. In
2003, Mr Mukund Kamath (son of Mr. Prabhakar Kamath) started own
ice cream manufacturing factory named as Ideal Ice Cream at
Mangalore (as a sole proprietorship). The entity has a
manufacturing plant spread over half acre, located at Derebil
Village in Mangalore with an installed capacity of 25,000 liters
per day. The entity has also commissioned two windmills with a
capacity of 1.25 MW each in the Gadag and Hasan districts of
Karnataka. The power produced from the windmills is currently
being sold to Chamundeswari Electricity Supply Company, Mysore
(CHESCOM) and Gulbarga Electricity Supply Company Limited
(GESCOM).
Recent Results
For 2010-11, the entity's operating income stood at INR20.3 crore
with a profit after tax of INR0.1 crore. As per the provisional
results for ten months ending January 2012, the entity's
operating income stands at INR20.9 crore with a profit before tax
of INR1.8 crore.
KINGFISHER AIRLINES: Allots 3.56cr Equity Share Against OCDs
------------------------------------------------------------
The Economic Times reports that Kingfisher Airlines Ltd said
Tuesday that it has alloted equity shares against optionally
convertible debentures (OCDs), a development that may help in
saving interest outflow on such instruments.
In a filing to the BSE, ET relates, Kingfisher said it has issued
a total of 3.56 crore equity shares to Star Investments Pvt Ltd
and Amar Nath Jhunjhunwala at a price of INR23.63 a share in lieu
of conversion of debentures.
In January last year, the report recalls, Kingfisher had allotted
over 7 crore optionally convertible debentures (OCDs), having an
interest rate of 8%, to the entities.
"Post allotment, the paid up equity share capital of the company
stands increased to INR613 crore from INR577 crore," the company
said.
According to the report, the conversion of OCDs to equity shares
will help Kingfisher reduce its debt burden as it will save on
the 8 per cent interest cost.
About Kingfisher Airlines
Headquartered in Mumbai, India, Kingfisher Airlines --
http://www.flykingfisher.com/-- formerly known as Deccan
Aviation Ltd., serves about 35 domestic destinations with a fleet
of more than 40 aircraft, including Airbus jets and ATR 72
turboprops. It maintains bases in major cities such as Delhi and
Mumbai. Kingfisher Airlines is a unit of UB Holdings, best known
for its United Breweries unit, and the carrier shares the
Kingfisher brand with a popular Indian beer. UB Holdings also
owns a stake in another domestic carrier, Air Deccan, whose
operations it combined with Kingfisher Airlines in mid-2008.
Kingfisher Airlines began flying in 2005.
* * *
Kingfisher Airlines lost money six years in a row, accumulating
net debt of INR77.2 billion (US$1.74 billion) as of March 2010,
according to data compiled by Bloomberg.
Kingfisher lost INR4.44 billion (US$90.1 million) in the fiscal
third quarter that ended in December 2011, 74.8% more than a loss
of INR2.54 billion a year earlier, The Economic Times disclosed.
The company has lost INR11.8 billion (US$240 million) in the
first nine months of the current fiscal year that ends in
March, a 35% rise from a year earlier.
M&M COCOA: ICRA Reaffirms 'D' Rating on INR20.40cr Bank Loans
-------------------------------------------------------------
ICRA has re-affirmed the long term rating assigned to INR20.40
crore bank facilities of M&M Cocoa Products Pvt Ltd at [ICRA]D.
Amount
Facilities (INR Cr) Ratings
---------- --------- -------
Fund Based Limits 19.90 [ICRA]D Reaffirmed
Non Fund Based Limits 0.50 [ICRA]D Reaffirmed
The rating continues to be constrained by delays in debt
servicing by the company.
Established in 2006 by Mr. Durga Prasad, M&M Cocoa Products Pvt
Ltd is engaged in processing of cocoa beans. The company has a
processing unit in Baddi, Himachal Pradesh with a total installed
capacity of 12000TPA. In 2003, Mr. Prasad acquired 40% stake in
Lotus Chocolate Company which was declared a sick unit during the
same period. Around 60% of its capacities were then being used by
Cadbury India Limited and balance was utilized to produce
industrial chocolates and consumer chocolates under own brand.
CIL sought comfort from their association with Mr. Durga Prasad's
commitment to timely delivery of quality products to the company.
In early 2006, CIL invited Mr. Durga Prasad to set up a
Greenfield cocoa beans processing plant at Baddi, Himachal
Pradesh to cater to part of CIL's raw material requirement. MMCPL
was then set up and a 7 year contract was awarded to the company.
For 8MFY2012, the company reported revenues of -INR12.66 crore
and PAT of -INR0.94 crore.
R.K. INFRA: Inadequate Info Cues Fitch to Migrate Ratings
---------------------------------------------------------
Fitch Ratings has migrated India-based R. K. Infra Corp Private
Limited's 'Fitch BB(ind)' National Long-term rating with a Stable
Outlook to the non-monitored category.
The ratings have been migrated to the non-monitored category due
to lack of adequate information, and Fitch will no longer provide
ratings or analytical coverage of R K Infra. The ratings will
remain in the non-monitored category for a period of six months
and be withdrawn at the end of that period. However, in the
event the issuer starts furnishing information during this six-
month period, the ratings could be reinstated and will be
communicated through a Rating Action Commentary.
Fitch has also migrated R K Infra's bank loan ratings to the non-
monitored category as follows:
-- INR205m fund-based working capital limits: migrated to
'Fitch BB(ind)nm'/'Fitch A4+(ind)nm' from 'Fitch
BB(ind)'/'Fitch A4+ (ind)'
-- INR655m non-fund-based working capital limits: migrated to
'Fitch A4+(ind)nm' from 'Fitch A4+(ind)'
R.V.M EDUCATION: CRISIL Puts 'CRISIL B-' Rating on INR200MM Loan
----------------------------------------------------------------
CRISIL has assigned its 'CRISIL B-/Stable' rating to the term
loan facility of R.V.M Education Pvt Ltd.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Term Loan 200 CRISIL B-/Stable
The rating reflects REPL's exposure to project execution risks
and constrained financial flexibility on account of sizeable
debt. These rating weaknesses are partially offset by the healthy
demand prospects for the educational sector in India.
Outlook: Stable
CRISIL believes that REPL's credit risk profile will remain
sensitive to timely infusion of funds by the promoter to service
debt and timely completion of the project. The outlook may be
revised to 'Positive' upon completion and timely stabilization of
project and more-than-expected student intake. Conversely, the
outlook may be revised to 'Negative' if there are delays in
execution of project and lower-than-expected cash generations,
leading to stretched liquidity.
About R.V.M Education
REPL was established in 2011 by Mr. Lokvesh Magu. The company is
currently undertaking a project to establish a school, Manav
Rachna International School, in Noida (Uttar Pradesh), under the
franchise with Manav Rachna Group. The school will offer pre-
primary, primary, and secondary education up to higher secondary.
Initially, the company will start classes from Montessori till
Class VII, and will subsequently add higher classes. The school
is expected to get operational from April 2013. The total cost of
the project is estimated to be around INR383.4 million, to be
funded with term loans of INR200 million, and the balance through
promoter's contribution.
SAURASHTRA FERROUS: Delays in Loan Payment Cues ICRA Junk Ratings
-----------------------------------------------------------------
ICRA has downgraded the long-term rating assigned to the
INR7.00 crore fund-based bank facilities, INR10.46 crore term
loans and INR4.52 crore working capital term loan facilities of
Saurashtra Ferrous Private Limited to '[ICRA]D' from '[ICRA]C'.
ICRA has also downgraded the short-term rating assigned of the
INR2.88 crore non-fund based bank facilities of SFePL to
'[ICRA]D' from '[ICRA]A4'.
Amount
Facilities (INR Cr) Ratings
---------- --------- -------
Fund-Based Limits 7.00 Downgraded to [ICRA]D
from [ICRA]C
Term Loans 10.46 Downgraded to [ICRA]D
from [ICRA]C
Working Capital Term 4.52 Downgraded to [ICRA]D
Loan from [ICRA]C
Non-Fund Based Limits 2.88 Downgraded to [ICRA]D
from [ICRA]A4.
The rating downgrade takes into account the recent delays made by
SFePL in servicing its debt.
Incorporated in 2005 and promoted by Saurashtra Fuels Pvt Ltd
(SFPL, rated [ICRA]B/[ICRA]A4), SFePL is a modest sized pig iron
manufacturer. The company has pig iron and cast iron
manufacturing capacities of 100,000 MTPA and 45,000 MTPA
respectively, which are located adjacent to the coke
manufacturing facilities of SFPL in Mundhra, Gujarat. The
company's pig iron sale is largely concentrated in the major
foundry hubs in the state of Gujarat. On account of
unavailability of iron ore, the manufacturing facility of SFePL
is non-operational since April 2011.
SHIVAM HI-TECH: CRISIL Places 'BB-' Rating on INR23.6MM Loan
------------------------------------------------------------
CRISIL has assigned its 'CRISIL BB-/Stable/CRISIL A4+' ratings to
the bank facilities of Shivam Hi-Tech Steels Pvt Ltd.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Term Loan 23.6 CRISIL BB-/Stable
Standby Line of Credit 10 CRISIL BB-/Stable
Letter of Credit 15 CRISIL A4+
Bank Guarantee 45 CRISIL A4+
Cash Credit 95 CRISIL BB-/Stable
The ratings reflect SHTPL's moderate financial risk profile,
marked by moderate gearing and debt protection metrics,
promoters' extensive experience in steel products, and
established relationship with reputed customers. These rating
strengths are partially offset by SHTPL's small scale of
operations in fragmented steel structures industry and high
customer and industry concentration.
Outlook: Stable
CRISIL believes that SHTPL will continue to benefit from its
promoters' extensive industry experience, over the medium term.
The outlook may be revised to 'Positive' in case of improvement
in financial risk profile and significant improvement in the
company's cash accruals. Conversely, the outlook may be revised
to 'Negative' in case of any further pressure on the company's
topline and profitability and further deterioration in liquidity
due to lower-than-expected cash accruals or deterioration in
financial risk profile.
About Shivam Hi-Tech
Incorporated in 2005, SHTPL manufactures fabricated steel
structures primarily used in boilers, power plants, and
construction of buildings. The company also trades in welding
rods, consumables, and other allied items (contributed around 10
per cent of its total revenue in 2010-11 [refers to financial
year, April 1 to March 31]). SHTPL was promoted by Mr. S C Gulati
and his brother, Mr. Manoj Gulati, in 2005. Later, Mr. Manoj
Gulati quit the business and Mr. Ketan Gulati (another brother)
joined as promoter. SHTPL has a capacity to manufacture about
12,000 tonnes per annum of steel structures at its manufacturing
facility in Raipur (Chhattisgarh). The company operates at around
60 per cent of its installed capacity.
SHTPL reported a profit after tax (PAT) of INR9.8 million on net
sales of INR365.9million for 2010-11, as against a PAT of INR2.6
million on net sales of INR171.6 million for 2009-10.
SHREE NAMAN: ICRA Cuts Rating on INR557cr Loan to '[ICRA]D'
-----------------------------------------------------------
ICRA has revised the assigned ratings to the INR557.0 crore term
loan limit of Shree Naman Developers Limited from '[ICRA]BB+' to
'[ICRA]D'.
Amount
Facilities (INR Cr) Ratings
---------- --------- -------
Term Loan 557.0 [ICRA]D Revised from
[ICRA]BB+
The revision in the ratings of Shree Naman Developers Limited
factor in the ongoing delay in servicing of debt obligations by
the company resulting from the delay in realisation against the
sale of electricity to Maharashtra State Electricity Board
(MSEB); high level of indebtedness with 46% of the outstanding
debt as of 31st March 2012 availed from financial
institutions/banks to be repaid in FY13 and exposure to market
risks in the unsold commercial spaces in Mumbai. ICRA notes that
the commercial space at BKC, Mumbai witnessed limited sales with
incremental booking of 9% of the saleable area in the past one
year. The rating is further constrained by the dependence of SNDL
on limited number of its ongoing projects (4) of which three
projects is in the initial stages of development.
However, ICRA takes note of the potential value of completed and
ready to use unsold commercial space at BKC, Mumbai which is a
premium location; location advantage for all the ongoing and
upcoming projects of the company and considerable progress
achieved towards construction and sale of the commercial project-
Naman Mid Town located at Worli (Mumbai).
Shree Naman Developers Limited is the flagship company of the
Shree Naman Group, promoted by Mr. Jayesh Shah and his family
members, who have been in the field of real estate development in
Mumbai since 1993. Since inception, the group has undertaken
development of residential and commercial properties in various
parts of Mumbai. The company developed three major commercial
projects viz. 'Naman Corporate Link', 'Naman Chambers' and 'Naman
Centre', having a total saleable area of approximately 0.42
million sq. ft., at Bandra-Kurla Complex in Mumbai. Presently;
SNDL is primarily focused on developing residential at Andheri
and commercial projects at Worli in Mumbai.
S. S. CONSTRUCTION: CRISIL Puts 'BB-' Rating on INR10MM Loan
------------------------------------------------------------
CRISIL has assigned its 'CRISIL BB-/Stable/CRISIL A4+' ratings to
the bank facilities of S. S. Construction Co.
Amount
Facilities (INR Mln) Ratings
---------- --------- -------
Bank Guarantee 60 CRISIL A4+
Overdraft Facility 10 CRISIL BB-/Stable
The ratings reflect SSCC's moderate financial risk profile,
marked by low gearing and strong debt protection metrics, and
promoter's extensive industry experience. These rating strengths
are partially offset by SSCC's small scale of operations, limited
revenue diversity, high geographical and customer concentration
in revenues, and a small order book.
CRISIL has treated non-interest bearing unsecured loans of
INR23 million extended to SSCC by the promoter and her associates
as neither debt nor equity as the loans will be retained in the
business until the bank loans are repaid.
Outlook: Stable
CRISIL believes that SSCC will continue to benefit over the
medium term from the extensive industry experience of its
promoter. The outlook may be revised to 'Positive' in case of
significant improvement in the scale of operations and
profitability, leading to better-than-expected cash accruals
along with efficient working capital management. Conversely, the
outlook may be revised to 'Negative' in case of further pressure
on the company's liquidity resulting from lower-than-expected
cash accruals or larger-than-expected working capital
requirements or in case of withdrawal of unsecured loan.
About S. S. Construction
Incorporated in 2005, SSCC is a proprietorship concern promoted
by Ms. Sangeeta Singh and is based in Lucknow (Uttar Pradesh
[UP]). SSCC is a class 'A' civil contractor and executes
contracts for road construction in UP. The entire business of the
firm is tender-based and it primarily executes tenders floated by
the Uttar Pradesh Public Works Department. SSCC derives its
entire revenues from UP.
=================
I N D O N E S I A
=================
BANK NEGARA: Moody's Rating on USD Notes Incorporates 'D' BFSR
--------------------------------------------------------------
Moody's Investors Service has assigned a Baa3 rating to Bank
Negara Indonesia's USD long-term senior unsecured notes. The
rating outlook is stable.
The rating was assigned on the condition that no material changes
are made to the draft terms and conditions of the notes reviewed
prior to the launch of the issuance.
Ratings Rationale
The Baa3 rating on BNI's USD notes incorporates: (1) the bank's
financial strength rating (BFSR) of D, which maps to a baseline
credit assessment of ba2; and (2) a very high probability of
systemic support from the Indonesian government.
The rating also reflects the senior, unsubordinated, and
unsecured terms of the notes.
BNI's other ratings are:
- D for its bank financial strength rating, translates to a
baseline credit assessment of ba2
- Baa3/P-3 on its local and foreign currency long-term/short-
term deposits
The outlook on all ratings is stable.
The methodologies used in this rating were Bank Financial
Strength Ratings: Global Methodology published in February 2007,
and Incorporation of Joint-Default Analysis into Moody's Bank
Ratings: Global Methodology published in March 2012.
BNI is headquartered in Jakarta and had assets of IDR299.06
trillion at end-December 2011. It is the fourth-largest bank in
Indonesia with an 7.9% share of system assets.
=========
J A P A N
=========
ASAHI MUTUAL: Fitch Affirms 'BB' Insurer Finc'l. Strength Rating
----------------------------------------------------------------
Fitch Ratings has affirmed Asahi Mutual Life Insurance Company's
Insurer Financial Strength (IFS) rating at 'BB'. The Outlook is
Stable.
The IFS rating reflects Asahi Life's weak capital adequacy
compared with its peers as well as its overall resilient life
insurance underwriting. Asahi Life's insurance underwriting has
been stable owing to its sophisticated marketing strategy and
focus on the profitable third (health) sector, but Fitch notes
that the company's negative spread remains sizable and continues
to offset gains from a lower-than-projected mortality rate.
Annual premiums of in-force policies of Asahi Life's third sector
were stable in April to December 2011. Fitch expects its large
negative spread to remain the company's weakness over the
foreseeable future but gradually narrow on declining average
guaranteed yield.
Gradual reduction in investment exposure to domestic equities
allowed the company to report stable capital adequacy levels at
end-December 2011 and should provide some protection against
falls in equity markets. Asahi Life's statutory solvency margin
ratio (SMR) of 592.3% (under new SMR regime: 353.9%) at end-
December 2011, compared with 602.6% at end-March 2011 (under new
SMR calculation: 361.2%), due to a weak domestic equity market in
2011. In comparison with its peers, Asahi Life's capital
position remains a weakness. Measures taken to strengthen asset
and liability management should help to narrow the duration gap,
which Fitch sees as one of the primary risks for the company.
Asahi Life has sizable exposure to Tokyo Electric Power,
Incorporated (TEPCO). However, as its exposure is made up of the
most senior bonds with collateral, Fitch and expects losses to be
manageable. The agency will continue to monitor this exposure
closely.
Key rating triggers for an upgrade include a further
strengthening of capitalisation, particularly if the new SMR
exceeds 400%, or if Fitch's internal capitalisation measure
improves further on a sustained basis. Growth in the company's
profitable third sector and/or improvement in the surrender and
lapse rates of its death protection products would also be viewed
positively by Fitch.
Key rating triggers for a downgrade include material erosion of
capitalisation, specifically, if the new SMR declines to 300%, or
if Fitch's internal capitalisation measure deteriorates on a
sustained basis. Significant deterioration in core profit and
TEPCO's default would also put the rating under pressure.
Asahi Life is one of the nine traditional domestic life insurers
in Japan. It had a 3.6% market share by amount of policies in-
force at end-March 2011.
J-CORE FL1: S&P Lowers Ratings on 2 Certificate Classes to 'D'
--------------------------------------------------------------
Standard & Poor's Ratings Services lowered to 'D (sf)' from 'CC
(sf)' its ratings on the class D and E trust certificates issued
under the J-CORE FL1 Trust Certificate (J-CORE FL1) transaction.
"The transaction's only remaining specified bond, which
originally represented about 8.3% of the total initial issuance
amount of the trust certificates, has already defaulted. The
specified bond was backed by a regional retail property, the sale
of which was completed in December 2011. On Jan. 23, 2012, we
lowered to 'CC (sf)' from 'CCC (sf)' the ratings on classes D and
E because we expected the sum of proceeds collected through the
sale of the property in question, as well as other funds in the
transaction that could ultimately be available for redemption, to
be lower than the total amount required to fully redeem these two
classes. This time, we have lowered to 'D (sf)' our ratings on
the class D and E trust certificates because we found that the
transaction's specified bond incurred a loss and confirmed that
part of the principal on the trust certificates will remain
outstanding on April 16, 2012, which is the transaction's legal
final maturity date," S&P said.
"J-CORE FL1 is a multiborrower commercial mortgage-backed
securities (CMBS) transaction. The trust certificates were
originally backed by three Tokkin (specified money in trust)
loans extended to three Tokkin trustees that each owns one
specified bond backed by real estate trust beneficial interests.
The trust certificates were also originally backed by one
additional nonrecourse loan backed by Tokkin beneficial interests
and real estate trust beneficial interests. The transaction was
arranged by Deutsche Securities Inc., and ORIX Asset Management &
Loan Services Corp. acts as the servicer for this transaction,"
S&P said.
"The ratings reflect our view on the likelihood of the full
payment of interest and the ultimate repayment of principal by
the transaction's legal final maturity date in April 2012 for the
class D and E trust certificates," S&P said.
STANDARD & POOR'S 17G-7 DISCLOSURE REPORT
SEC Rule 17g-7 requires an NRSRO, for any report accompanying a
credit rating relating to an asset-backed security as defined in
the Rule, to include a description of the representations,
warranties and enforcement mechanisms available to investors and
a description of how they differ from the representations,
warranties and enforcement mechanisms in issuances of similar
securities. The Rule applies to in-scope securities initially
rated (including preliminary ratings) on or after Sept. 26, 2011.
If applicable, the Standard & Poor's 17g-7 Disclosure Report
included in this credit rating report is available at:
http://standardandpoorsdisclosure-17g7.com
RATINGS LOWERED
J-CORE FL1 Trust Certificate
JPY16.6 billion floating-rate trust certificates due April 2012
Class To From Initial issue amount
D D (sf) CC (sf) JPY1.0 bil.
E D (sf) CC (sf) JPY0.2 bil.
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K O R E A
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KOREA DEVELOPMENT: S&P Lowers Stand-alone Credit Profile to 'bb+'
-----------------------------------------------------------------
Standard & Poor's Ratings Services affirmed its 'A' foreign-
currency long-term counterparty credit and senior unsecured issue
ratings on Korea Development Bank. "In addition, we affirmed the
'A-1' short-term rating on the bank. At the same time, we lowered
KDB's stand-alone credit profile (SACP) to 'bb+' from 'bbb-',
reflecting weaker capitalization mainly due to higher-than-
expected credit growth. The outlook on KDB is negative," S&P
said.
"Our downward revision of the SACP reflects a change in our
assessment of KDB's capital and earnings to 'adequate' from
'strong.' We expect KDB's risk-adjusted capital (RAC) ratio
before diversification and concentration adjustments to be 8% to
9% in the next 18 months. We estimate that KDB's 2011 RAC ratio
will fall below our expectation of above 10% mainly on greater-
than-expected credit growth. We believe the RAC ratio will likely
remain under pressure in the next few years considering the
bank's business expansion," S&P said.
"Despite our downward revision of the bank's SACP, we affirmed
our ratings on KDB as we still hold the view that there is an
'extremely high' likelihood that the government of Korea (foreign
currency A/Stable/A-1; local currency A+/Stable/A-1) would
provide timely and sufficient extraordinary support to KDB in the
event of financial distress. In accordance with our criteria for
government-related entities, our rating approach is based on our
view of KDB's 'critical' role for, and 'very strong' link with,
the Korean government. We believe that KDB will closely
collaborate with and provide support to Korea Finance Corp.'s
(KoFC: foreign currency A/Stable/A-1) policy banking function
for the foreseeable future. (KoFC was spun off from KDB in 2009
as part of the government's measures to privatize KDB. Following
the spin-off, KoFC continues to provide public policy financing.)
We hold this view because KDB is larger than KoFC and it has the
policy banking know-how to ensure a smooth policy role transfer
until KoFC can sufficiently carry out its policy role. Currently,
KDB is ultimately 100% owned by the Korean government through KDB
Financial Group (not rated), the holding company of KDB and
KoFC," S&P said.
"The outlook on KDB's long-term counterparty credit rating is
negative, reflecting the risk of a lower likelihood of government
support once privatization proceeds. Privatization is a key risk
factor, and we note that there has been some significant
developments related to privatization, such as a potential
initial public offering through the sale of some of KDB Financial
Group's existing shares. The privatization of KDB could
negatively impact the ratings on the bank because expected
government support would weaken," S&P said.
"The ratings on KDB could come under downward pressure if KoFC
runs its policy role independently, thereby reducing KDB's
critical policy role, or if the government's ownership of KDB
meaningfully changes, indicating possible significant changes in
KDB's linkage with or its importance to the government. We could
also lower the ratings on KDB if it significantly expands its
commercial business lines, suggesting a weakening policy role. On
the other hand, we could revise the outlook to stable if
privatization risk is significantly reduced due to measures by
the government such as abolishing or significantly delaying the
privatization plan. This, however, is unlikely in our view," S&P
said.
SUHYUP BANK: Moody's Issues Summary Credit Opinion
--------------------------------------------------
Moody's Investors Service issued a summary credit opinion on
Suhyup Bank and includes certain regulatory disclosures regarding
its ratings. The release does not constitute any change in
Moody's ratings or rating rationale for Suhyup Bank.
Moody's current ratings on Suhyup Bank are:
Senior Unsecured (foreign currency) ratings of A2
Senior Unsecured MTN Program (foreign currency) ratings of (P)A2
Long Term Bank Deposits (domestic and foreign currency) ratings
of A2
Bank Financial Strength ratings of D-
Subordinate MTN Program (foreign currency) ratings of (P)A3
Junior Subordinate MTN Program (foreign currency) ratings of
(P)A3
Short Term Bank Deposits (domestic and foreign currency) ratings
of P-1
Other Short Term (foreign currency) ratings of (P)P-1/P-1
Ratings Rationale
Moody's has assigned an "A2" foreign currency long-term senior
unsecured debt rating to Suhyup Bank. The rating incorporates
two factors: (1) the bank's bank financial strength rating (BFSR)
of D-, which maps to ba3 on the long-term scale; (2) Moody's
assessment of the very high probability of government support (a
component of joint default analysis, referred to as JDA).
The D- BFSR reflects the bank's small and evolving franchise
value as well as its modest financial metrics, including its
somewhat low profitability and modest capital adequacy.
Suhyup, with 112 branches, is one of the country's smaller policy
institutions. Its profit structure is modest (reflecting its
policy role and limited franchise), as is its capital adequacy.
Although its business is not very profit-oriented, Suhyup is
moving towards a more commercial model. Policy loans accounted
for about 17.6% of its credit portfolio at end-2010 and are
guaranteed by the Agricultural Fisheries Credit Guarantee Fund
and Bad Debt Reserve Fund.
Moody's believes that the bank would be fully supported by the
government in the event of stress, which results in a seven-notch
lift in its global local currency (GLC) deposit rating from its
standalone ba3. This view is predicated on the bank's policy role
of providing financing and support for the development of Korea's
fisheries and maritime industries.
However, the Fisheries Cooperative Law (FCL) that governs Suhyup
does not contain explicit support language like the legislation
governing Korea's three other policy banks, Korea Development
Bank, Industrial Bank of Korea, and the Export-Import Bank of
Korea.
However, because of its working relationship with the Ministry
for Food, Agriculture, Forestry and Fisheries (MIFAFF), Moody's
considers Suhyup essentially a ministry financing arm. The
government views the fisheries and maritime sector as vital for
the country's balanced economic development, despite its limited
contributions to Korea's gross domestic product and employment.
KDIC -- the Korea Deposit Insurance Corporation -- now owns 100%
of the bank, following a capital injection it made in 2001. In
connection with this support, the bank operates under a
Management Rehabilitation Plan, which incorporates a number of
financial targets. In addition, Suhyup separates its management,
operations, and assets and liabilities from the other business
units of the National Federation of Fisheries Cooperatives
(NFFC).
Rating Outlook
The outlook for all of Suhyup Bank's ratings is negative. Its
policy role and smaller size mean that the bank has a modest
profit structure and capitalization. The latter characteristic in
turn provides a thinner buffer against the risk of deteriorations
in asset quality when compared to the domestic commercial banks.
In addition, the uncertainty over the conversion of its
preference shares into common equity by the government pressures
its credit profile negatively.
What Could Change the Rating - Up
Moody's does not see much chance for the bank's long-term deposit
or debt ratings to be upgraded in the foreseeable future, because
its A2 long-term senior debt or deposit ratings has already
incorporated a seven-notch rating uplift due to Moody's
assumption of government bailout likelihood.
What Could Change the Rating - Down
Moody's would consider downgrading the bank's senior unsecured
debt ratings on a downgrade of its BFSR. However, even if the
downgrade is not triggered by a BFSR downgrade, Moody's would
still consider downgrading the bank's senior unsecured debt
ratings if Moody's sees signs that its policy role and special
relationship with the government are weakening; for example, the
government fails in providing clear support on the conversion of
its preference shares into common equity by end-2012.
Moody's would consider downgrading the BFSR if the rating agency
sees (1) the government fails in providing clear support on the
conversion of its preference shares into common equity by end-
2012, or (2) the bank's core Tier 1 ratio drops below 4.5%, or
(3) its NPL ratio on a consolidated basis rises above 4.0%; it
was about 2.7% in June 2011.
Failure in the conversion of its preference shares into common
equity by end-2012 could trigger downgrades of both the senior
unsecured debt ratings and BFSR. This is because such a failure
would weaken assumptions over strong systemic support and weaken
capital adequacy from the perspective of new regulations.
The methodologies used in this rating were Bank Financial
Strength Ratings: Global Methodology published in February 2007,
Incorporation of Joint-Default Analysis into Moody's Bank
Ratings: Global Methodology published in March 2012, and Short-
Term Prime Ratings published in June 2010.
====================
N E W Z E A L A N D
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ALLIED NATIONWIDE: Receivers Await Offer to Handover Assets
-----------------------------------------------------------
Businessdesk reports that receivers for Allied Nationwide Finance
are waiting on a formal offer to hand over the failed lender's
assets to the government as part of the wind-down of finance
companies that collapsed and were covered by the retail deposit
guarantee scheme.
According to BusinessDesk, McGrathNicol's Andrew Grenfell said in
the fourth receiver's report that the Treasury has been
undertaking due diligence and is in preliminary negotiations over
a potential sale and purchase agreement.
The receivers have made two distributions of NZ$14 million and
NZ$6 million since August 19, taking the total repayments to the
Crown to NZ$70 million, says BusinessDesk.
"The receivers expect to receive a formal offer from the Crown in
the coming weeks," Mr. Grenfell, as cited by BusinessDesk, said
in the report.
"Until negotiations with the . . . for the remaining assets of
the company are complete, the receivers are unable to assess the
total return to the Crown from the receivership."
Allied Nationwide called on the government's deposit guarantee in
August 2010 after it was forced to stop raising new funds when it
breached its trust deed. The government paid out some 4,500
debenture holders NZ$128 million under the scheme that guaranteed
depositors' funds, BusinessDesk notes.
BusinessDesk relates that Finance Minister Bill English has since
said the government will take control of some NZ$350 million of
assets from the failed finance companies through a new entity
called Crown Asset Management, to control fees paid to receivers.
Mr. Grenfell said the receivers continued negotiations with
potential buyers of Allied Nationwide's loan book, but "no
acceptable offers have been received," BusinessDesk adds.
About Allied Nationwide
Allied Nationwide Finance Ltd. is a New Zealand-based finance and
investment company. It is wholly owned subsidiary of NZX-listed
Allied Farmers Limited.
* * *
Allied Nationwide Finance Limited was placed into receivership on
Aug. 20, 2010. The company's Trustee, New Zealand Guardian
Trust, appointed Kerryn Downey and Andrew Grenfell of
McGrathNicol as receivers to the Company. McGrathNicol has been
acting as independent advisors to NZGT and prepared a report on
ANF which resulted in the alleged breach of its Trust Deed ratio,
as advised on Aug. 6, 2010.
================
S R I L A N K A
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BANK OF CEYLON: Moody's Assigns 'B1' Rating; Outlook Stable
-----------------------------------------------------------
Moody's Investors Service has assigned following debt and deposit
ratings to Bank of Ceylon, with a stable outlook.
The detailed ratings assigned are:
Local currency deposits: B1/NP
Foreign currency deposits: B2/NP
Foreign currency senior unsecured debt: B1
Foreign currency Issuer rating: B1
Moody's has also assigned E+ bank financial strength rating
(BFSR), mapping to a baseline credit assessment (BCA) of b2, with
a stable outlook.
Ratings Rationale
This is the first time Moody's is assigning international ratings
for BOC. These ratings and outlook take into account the balance
of strengths and weaknesses characterizing BOC's credit profile
on a standalone basis, as well as Moody's assumptions for the
probability of government support in times of stress, which
Moody's assesses as very high. At E+/ b2, Moody's support
assumption results in a one-notch rating uplift to the B1 local
currency deposit rating.
The BFSR reflects BOC's leadership position in the domestic
banking system that underpins its strengths in loan and deposit
mobilization and stable profitability, which is supported by both
lending and fee-based services. The rating also takes into
account the bank's relatively weaker financial profile and risk
positioning compared with other E+ Moody's-rated banks globally.
It reflects the bank's declining capital and liquidity buffers
available to withstand systemic stresses as a result of its
recent above-industry credit growth. Also, Moody's views the
bank, like its domestic peers, to be vulnerable to the
unavoidable cyclicality inherent to emerging markets, which
exposes it to periodic asset quality pressure. Also, for a bank
exposed to such risk, Moody's considers its provision coverage to
be low.
Given its full ownership by the Sri Lankan government, its
dominant market shares in domestic deposits and treasury
activities, as well as past evidence of support received from the
government, Moody's believes BOC is very important to the Sri
Lankan banking system. These considerations have resulted in a
one-notch uplift for its local currency deposit rating from its
b2 BCA.
The stable outlook for the bank's ratings reflect Moody's
expectation that its credit growth will moderate and become in
line with the industry level over the next 12-18 months, and its
capital and liquidity buffers will increase and be sufficient to
withstand additional credit losses and systemic stresses at its
current rating level.
BOC's loan mix is geared towards large corporations and
government-related entities. Its retail and small and medium-
sized enterprise (SME) portfolios are fairly sizable and it plans
to grow these segments.
Its credit profile is characterized by its leadership position in
the Sri Lankan banking system, with a market share of 21% in
loans and deposits. It manages the majority of inward remittances
and foreign exchange transactions in Sri Lanka, and operates the
most extensive network of branches and ATMs distributed
throughout the country. Leveraging this entrenched franchise and
operating platform, BOC has steadily generated strong
profitability and maintained better asset quality metrics than
similarly-rated global peers.
Due to BOC's focus on lending to lower-yielding large
corporations and government-related entities compared to retail
and SMEs, its net interest margins have trended lower than its
peers and the industry average.
Nonetheless, the bank has maintained stable margins which support
its net interest income. Its fee-based income from its strong FX,
inward remittances, and trade finance businesses has also
consistently been a significant contributor to its overall
profits.
At end-2011, pre-provision profits and net income were 4.9% and
3.5%, respectively, as a percentage of its risk-weighted assets.
Compared to Moody's E+ rated banks globally, BOC fares better in
terms of profitability.
BOC's asset quality has shown consistent improvement over the
past three years, evidenced by the steady decline in nominal non-
performing loans (NPL), NPL ratios and new NPL formation rates.
At end-2011, its NPL ratio declined to 3.6%, from 5.4% at end-
2010 and 8.4% at end-2009.
Similarly, new NPL formation rate slowed to 0.9% at end-2011,
from 1.2% at end-2010 and 3.6% at end-2009. NPL write-offs were
minimal as the bank focused on loan collection, recovery and
restructuring.
While the bank has instituted an integrated risk-management
framework and implemented risk management processes, which
include clearly laid out credit approval processes, limits and
controls, Moody's scenario analysis indicates that its asset
quality could rapidly deteriorate in a cyclical downturn, given
the characteristics of the emerging market in which it operates
in and its rapid credit growth during 2010 and 2011. Profits
would be under pressure due to the unavoidable increase in
provisions that would result while considering the low base from
which these provisions started.
With these characteristics in mind, Moody's assessed the capital
and liquidity buffers available to protect the bank from systemic
stresses. BOC's Tier 1 capital ratio has been steadily falling
over the past three years.
At end-2011, its Tier 1 capital ratio stood at 9.3%, lower than
11.4% in 2010 and 12.0% in 2009. While its capital ratios have
consistently remained above the local regulatory minimums (Tier 1
ratio of 5% and Total capital ratio of 10%), its capital levels
have trended below the average industry level since 2009.
Importantly, although the bank recorded strong profits in both
years, it was unable to replenish capital internally at the same
rate as it grew its loans to maintain capital levels.
Moody's believes BOC's current capital level is insufficient to
protect it from insolvency pressures in the event of an economic
downturn. In an adverse stress scenario in which asset quality
deteriorates to 2009 levels -- with gross NPL ratio peaking at
8.4% over the past five years and profits declining broadly by
10% -- BOC's Tier 1 capital ratio could fall to 4% based on its
2011 financials.
Like other banks in Sri Lanka, BOC's deposit growth has not been
able to keep pace with its credit growth. However, while its
liquidity profile has in the past trended in line with the
industry, its loan-to-deposit ratio significantly exceeded the
industry's average in 2011. At end-2011, its overall loan-to-
deposit ratio deteriorated to 98.7%, from 77.0% a year ago,
compared with 85% for the industry for the same period.
Similarly, its foreign currency loan-to-deposit ratio
deteriorated to 89.5% at end-2011, from 61.0% a year ago.
Its rating outlook could be revised to negative if its core Tier
1 capital ratio drops to less than 9% and/or loan-to-deposit
ratio exceeds 100%. Also, if its net income drops to below 3% of
risk-weighted assets and weighs on internal capital generation,
then its ratings would be under pressure.
In order for its standalone ratings to be upgraded, BOC would
need a sustained recovery of its capital and liquidity buffers,
as reflected for instance in a core Tier 1 capital ratio of more
than 10% and a loan-to-deposit ratio of less than 85% over six
consecutive quarters.
The foreign currency senior unsecured debt rating of B1 factors
in the very high level of systemic support from the government,
which is also rated B1 for foreign currency debt. As part of
Moody's joint default analysis model, Moody's considers Sri Lanka
to be a medium support country.
In assessing the probability and the likelihood of external
support, Moody's took into account the systemic importance of the
bank, as well as the willingness and capacity of the government
to provide support, including the non-fiscal measures that could
be deployed to support a bank, if needed.
The rating is subject to the receipt of final documentation, with
terms and conditions that do not deviate materially from the
preliminary documents already reviewed by Moody's.
Established in 1939 and headquartered in Colombo, BOC had assets
of LKR856.4 billion (US$7.5 billion) at end-December 2011.
Principal Methodologies
The methodologies used in this rating were Bank Financial
Strength Ratings: Global Methodology published in February 2007,
and Incorporation of Joint-Default Analysis into Moody's Bank
Ratings: Global Methodology published in March 2012.
BANK OF CEYLON: Fitch Places 'BB-' IDR With Stable Outlook
----------------------------------------------------------
Fitch Ratings has assigned Sri Lanka's Bank of Ceylon Long-Term
Foreign- and Local-Currency Issuer Default Ratings (IDRs) of
'BB-' with Stable Outlooks. Fitch has also assigned BOC a 'b+'
Viability Rating (V/R). Simultaneously, BOC's National Long-Term
rating and its outstanding subordinated debentures have been
affirmed at 'AA+(lka)' with a Stable Outlook and 'AA(lka)',
respectively.
Fitch has also assigned BOC's proposed senior unsecured USD-
denominated notes an expected rating of 'BB-(exp)', same as its
Foreign Currency IDR. The size and tenor of the notes are yet to
be determined. The final rating is contingent upon receipt of
final documents conforming to information already received.
BOC's IDRs and National Long-Term ratings reflect Fitch's
expectation of support from the government of Sri Lanka (GoSL,
'BB-'), if required, given its quasi sovereign status, high
systemic importance and role as one of the main bankers to the
government. BOC is the largest bank in Sri Lanka and fully owned
by GoSL. Any change in Sri Lanka's sovereign ratings would
likely be reflected in the ratings of BOC.
The V/R reflects BOC's domestic franchise being underpinned by
its sovereign linkages and extensive branch network, as well as
its weak capitalisation, improving profitability, increasing
loan/deposit ratio and concentration in the state sector (GoSL
and state entities).
While BOC's IDRs and National Long-Term rating are closely
correlated with Sri Lanka's sovereign rating, an upgrade of BOC's
National Long-Term rating could result from a demonstration of
preferential support for BOC. The V/R could be upgraded if BOC
enhances its capital buffer substantially (including a high loan
loss reserve coverage), the loan-deposit ratio is
maintained/sustained at 80%-85% and/or supplemented by medium
term wholesale funding, and operating performance and asset
quality remain stable. The V/R could be downgraded if capital
buffer weakens from continued high asset growth, or if a large
asset quality downturn from domestic/external macroeconomic
shocks leads to capital impairment.
BOC has established a strong domestic deposit franchise, as
reflected in a high current and savings accounts deposit ratio
(51% at end-2011). Nevertheless, aggressive 45% loan growth in
FY11, driven by increased lending to the state and certain
private sector business segments, sharply increased its
loan/deposit ratio to 95% (FY10: 74%). Management is challenged
to reduce this ratio to the target 85%, amid increased
competition for deposits and expected continued strong credit
growth.
Fitch notes that the high credit growth, alongside high dividend
payouts in the last two years and no fresh capital injection
since FY07, has weakened BOC's capitalisation. Tier 1 capital
and capital adequacy ratios were reported at 9.3% and 12.8%,
respectively, at end-2011, compared with 11.4% and 15.2% at end-
2010; Although these are well above the local regulatory
requirements of 5% and 10%, respectively, but are inflated by the
zero-risk weighted exposures to the state sector and gold-backed
loans as per local regulatory guidelines. Equity/asset ratio
remains low at 5.1% at end-2011, although marginally improved
from 4.3% at end-2010.
Fitch notes that BOC's profitability remains low.; although
return on assets improved to 1.45% in 2011 (2010: 1.08%) mainly
from reduced effective taxes due to the reduction in tax rates in
Sri Lanka and from reduction/reversal of general provision as per
the Central Bank of Sri Lanka guidelines. BOC's large exposure
to the state sector and local corporates (that are perceived as
lower risk in the local market) has resulted in its net interest
margins (2011: 3.70%, 2010: 3.64%) being historically lower than
peers, while its operating cost base is also high.
The high credit concentration of BOC in the state sector reflects
its sovereign linkages, and as such is unlikely to reduce in the
foreseeable future. On balance sheet and off-balance sheet
exposure to the state sector accounted for 43% and 18% of assets
at end-2011, with the top five exposures accounting for a
significant 645% of equity. However, Fitch notes that all these
relate to state-owned entities and bulk of these are secured.
Although net non-performing loans (NPLs minus specific loan loss
reserves (LLRs)/equity) improved to 11.9% at end-2011 (2010:
19.5%), Fitch considers a high LLR buffer as imperative amid the
strong credit growth in the last two years. The requirement of
provisioning starting only for NPLs delinquent beyond 180 days,
together with the reversal of a part of the general provisions
(as per local regulatory guidelines), elevates residual
provisioning risks. Fitch also expects some slippages from the
seasoning of the non-state sector portfolio, a latent asset
quality impact from rising domestic interest rates and possible
external shocks from a flare-up in geo-political tensions and
economic slow-down in Sri Lanka's key import/export markets.
BOC is the largest bank in terms of assets in Sri Lanka. Its
established domestic franchise is supported by 970 service points
(318 branches, 248 extension offices and 404 ATMs) across the
country. The bank has maintained a sizeable share of domestic
banking system assets, loans and deposits at 22%, 21% and 21%,
respectively, at end-2011.
A full list of BOC's ratings:
-- LT Foreign- and Local-Currency IDRs assigned at 'BB-';
Outlook Stable
-- Viability Rating assigned at 'b+'
-- Support Rating assigned at '3'
-- Support Rating Floor assigned at 'BB-'
-- Proposed USD senior unsecured notes assigned at 'BB-(exp)'
-- National Long-Term rating affirmed at 'AA+(lka)' ; Outlook
Stable
-- Outstanding subordinated debentures affirmed at 'AA(lka)'.
=============
V I E T N A M
=============
* VIETNAM: 20% Seafood Firms Face Stagnancy, Bankruptcy in 2012
---------------------------------------------------------------
Tuoitrenews reports that about one-fifth of Vietnamese seafood
enterprises will probably face stagnancy, and possibly even
bankruptcy, this year, said a senior official of the Vietnam
Association of Seafood Exporters and Processors (VASEP).
"It is very unusual that several seafood enterprises have filed
for bankruptcy since early this year, and the situation is
expected to worsen," the report quotes Nguyen Huu Dung, vice
chairman of VASEP at a meeting titled, "Applicable solutions in
resource management and planning for the fisheries industry",
held in the Mekong Delta city of Can Tho.
"The situation has been caused by subjective reasons including
the lack of effective policies to support companies and the
shrinking of both foreign and local markets," he added.
The prices of raw catfish in the provinces of the Mekong Delta,
such as Dong Thap, An Giang, and Can Tho, continue to fall, with
prices ranging from VND20,000-21,000 per kg for first-grade fish,
and VND19,000 -19,500 per kg for second-grade products.
"The government should change the way it operates the economy by
channeling low-interest capital to save the businesses and offer
tax breaks to help them boost production," Thoi Bao Kinh Te Sai
Gon newspaper quoted Dung as saying.
"The arbitrary increase of charges on businesses should also be
stopped. However, the most important task, restructuring and
renovating operational models, must be done by businesses
themselves," he said.
*********
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, Ivy B. Magdadaro, Frauline S.
Abangan, and Peter A. Chapman, Editors.
Copyright 2012. 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
Peter Chapman at 240/629-3300.
*** End of Transmission ***